CHARLOTTE, N.C., April 19, 2018 /PRNewswire/ -- Nucor Corporation
(NYSE: NUE) announced today consolidated net earnings of
$354.2 million, or $1.10 per diluted share, for the first quarter of
2018. By comparison, Nucor reported consolidated net earnings of
$383.9 million, or $1.20 per diluted share, for the fourth quarter
of 2017 and $356.9 million, or
$1.11 per diluted share, for the
first quarter of 2017.
"Nucor's disciplined strategy for profitable growth is working,"
said John Ferriola, Nucor's
Chairman, Chief Executive Officer and President. "Our 2017
earnings were Nucor's highest annual earnings since the cyclical
peak year of 2008. The positive momentum has clearly carried
over into 2018, as evidenced by our strong first quarter earnings
and a bullish second quarter outlook."
Selected Segment Data
In the first quarter of 2018,
the Company began reporting its tubular products and piling
businesses as part of the steel products segment. These
businesses were previously included in the steel mills segment. All
prior period segment data presented in this release has been recast
to reflect this change. Earnings (loss) before income taxes and
noncontrolling interests by segment were as follows for the first
quarters of 2018 and 2017 (in thousands):
|
|
Three Months (13
Weeks) Ended
|
|
|
March 31,
2018
|
|
April 1,
2017
|
|
|
|
|
|
Steel
mills
|
|
$
560,503
|
|
$
644,183
|
Steel
products
|
|
85,814
|
|
66,919
|
Raw
materials
|
|
74,547
|
|
26,391
|
Corporate/eliminations
|
|
(204,952)
|
|
(188,518)
|
|
|
$
515,912
|
|
$
548,975
|
|
|
|
|
|
Financial Review
Included in the first quarter of 2018
results was an expense of $21.8
million, or $0.07 per diluted
share, related to the write off of deferred tax assets due to the
change in the tax status of a subsidiary. Included in the fourth
quarter of 2017 results was a net benefit of $175.2 million, or $0.55 per diluted share, related to the impacts
of U.S. federal tax legislation enacted in the fourth quarter of
2017. Included in the first quarter of 2017 results were inventory
related purchase accounting charges of $9.8
million, or $0.02 per diluted
share, associated with the recent acquisitions of Southland Tube
and Republic Conduit.
Nucor's consolidated net sales increased 9% to $5.57 billion in the first quarter of 2018
compared with $5.09 billion in the
fourth quarter of 2017 and increased 16% compared with $4.82 billion in the first quarter of 2017.
Average sales price per ton in the first quarter of 2018 increased
3% compared with the fourth quarter of 2017 and increased 9%
compared with the first quarter of 2017. Total tons shipped to
outside customers were 6,967,000 tons in the first quarter of 2018,
a 6% increase from both the fourth quarter of 2017 and the first
quarter of 2017. Total steel mill shipments in the first quarter of
2018 increased 8% from the fourth quarter of 2017 and increased 7%
from the first quarter of 2017. Downstream steel products shipments
to outside customers in the first quarter of 2018 increased 1% from
the fourth quarter of 2017 and increased 15% from the first quarter
of 2017.
The average scrap and scrap substitute cost per ton used during
the first quarter of 2018 was $337, a
6% increase compared to $317 in the
fourth quarter of 2017 and an increase of 19% compared to
$284 in the first quarter of
2017.
Overall operating rates at our steel mills increased to 92% in
the first quarter of 2018 as compared to 82% in the fourth quarter
of 2017 and 88% in the first quarter of 2017.
Total steel mill energy costs in the first quarter of 2018
increased approximately $1 per ton
compared to both the fourth quarter of 2017 and first quarter of
2017 due to higher electricity unit costs.
Our liquidity position remains strong with $760.0
million in cash and cash equivalents as of March 31, 2018. Subsequent to the end of the
first quarter, we amended and extended our untapped $1.5 billion revolving credit facility to mature
in April 2023.
Recent Developments
In February
2018, Nucor's board of directors declared a cash dividend of
$0.38 per share payable on
May 11, 2018 to stockholders of
record on March 29, 2018. This
dividend is Nucor's 180th consecutive quarterly cash dividend, a
record we expect to continue.
In March 2018, Nucor announced
plans to build a rebar micro mill in Frostproof, Florida, which is located in
Polk County. The micro mill is a
$240 million investment that will
have an estimated annual capacity of 350,000 tons and employ
approximately 250 people. We anticipate the project will take
approximately two years to complete. This location will provide a
logistical advantage to Nucor and allow us to capitalize on a
currently abundant supply of scrap, a good portion of which is
handled by our scrap business, The David J. Joseph Company. This is
the second rebar micro mill Nucor is constructing.
First Quarter of 2018 Analysis
As expected, earnings
in the steel mills segment in the first quarter of 2018 improved
compared to the fourth quarter of 2017 due to higher selling prices
and increased volumes for all of our steel mill products. The
profitability of the steel products segment in the first quarter of
2018 decreased compared to the fourth quarter of 2017 due to
typical seasonality. The performance of the raw materials segment
improved from the fourth quarter of 2017 due to the much improved
performance of our scrap processing operations as well as our
direct reduced iron (DRI) facilities.
Second Quarter of 2018 Outlook
Earnings in the second
quarter of 2018 are expected to increase significantly compared to
the first quarter of 2018. It is worth noting that steel mill metal
margins and profits in March were by far the strongest in the first
quarter of 2018. The performance of the steel mills segment is
expected to improve in the second quarter of 2018 as compared to
the first quarter of 2018 as we continue to experience the benefit
of announced price increases. We believe there is sustainable
strength in steel end use markets, and we are encouraged by recent
actions by the government to address the massive flood of dumped
and illegally subsidized imports into the
United States. We believe broad-based tariffs with few
exceptions are needed to address the historic volume of unfairly
traded imports and transshipping that is done to avoid trade
duties. We expect improved performance for our steel products
segment in the second quarter of 2018 as compared to the first
quarter of 2018 as rising steel input costs are being passed on to
customers.
About Nucor
Nucor and its affiliates are manufacturers
of steel products, with operating facilities primarily in the U.S.
and Canada. Products produced
include: carbon and alloy steel -- in bars, beams, sheet and plate;
hollow structural section tubing; electrical conduit; steel piling;
steel joists and joist girders; steel deck; fabricated concrete
reinforcing steel; cold finished steel; steel fasteners; metal
building systems; steel grating; and wire and wire mesh. Nucor,
through The David J. Joseph Company, also brokers ferrous and
nonferrous metals, pig iron and HBI/DRI; supplies ferro-alloys; and
processes ferrous and nonferrous scrap. Nucor is North America's largest recycler.
Forward-Looking Statements
Certain statements
contained in this news release are "forward-looking statements"
that involve risks and uncertainties. The words "believe,"
"expect," "project," "will," "should," "could" and similar
expressions are intended to identify those forward-looking
statements. Factors that might cause the Company's actual
results to differ materially from those anticipated in
forward-looking statements include, but are not limited to: (1)
competitive pressure on sales and pricing, including competition
from imports and substitute materials; (2) U.S. and foreign trade
policies affecting steel imports or exports; (3) the sensitivity of
the results of our operations to prevailing steel prices and the
changes in the supply and cost of raw materials, including scrap
steel; (4) market demand for steel products; and (5) energy costs
and availability. These and other factors are discussed in
Nucor's regulatory filings with the Securities and Exchange
Commission, including those in Nucor's fiscal 2017 Annual
Report on Form 10-K, Item 1A. Risk Factors. The
forward-looking statements contained in this news release speak
only as of this date, and Nucor does not assume any
obligation to update them.
Broadcast of Conference Call
You are invited to listen
to the live broadcast of Nucor's conference call in which
management will discuss Nucor's first quarter results on
April 19, 2018 at 2:00 p.m. eastern time. The conference call will
be available over the Internet at www.nucor.com, under Investor
Relations.
TONNAGE
DATA
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
(13 Weeks) Ended
|
|
|
|
March 31,
2018
|
|
April 1,
2017
|
|
Percentage
Change
|
Steel mills total
shipments
|
|
|
|
|
|
|
|
Sheet
|
|
2,698
|
|
2,705
|
|
-
|
|
Bars
|
|
2,242
|
|
1,957
|
|
15%
|
|
Structural
|
|
601
|
|
572
|
|
5%
|
|
Plate
|
|
596
|
|
577
|
|
3%
|
|
Other
|
|
131
|
|
74
|
|
77%
|
|
|
|
6,268
|
|
5,885
|
|
7%
|
|
|
|
|
|
|
|
|
Sales tons to
outside customers:
|
|
|
|
|
|
|
|
Steel
mills
|
|
5,016
|
|
4,860
|
|
3%
|
|
Joist
|
|
105
|
|
101
|
|
4%
|
|
Deck
|
|
106
|
|
106
|
|
-
|
|
Cold
finished
|
|
147
|
|
122
|
|
20%
|
|
Fabricated
concrete
|
|
|
|
|
|
|
|
reinforcing
steel
|
|
290
|
|
247
|
|
17%
|
|
Piling
|
|
126
|
|
119
|
|
6%
|
|
Tubular
products
|
|
284
|
|
223
|
|
27%
|
|
Other
|
|
893
|
|
806
|
|
11%
|
|
|
|
6,967
|
|
6,584
|
|
6%
|
CONDENSED
CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited)
|
(In thousands,
except per share data)
|
|
|
|
|
|
Three
Months (13 Weeks) Ended
|
|
|
|
|
|
March 31,
2018
|
|
April 1,
2017
|
|
|
|
|
Net
sales
|
$
5,568,419
|
|
$
4,815,179
|
|
|
|
|
Costs, expenses
and other:
|
|
|
|
Cost of
products sold
|
4,842,013
|
|
4,054,929
|
Marketing,
administrative and other expenses
|
182,960
|
|
176,426
|
Equity in
earnings of unconsolidated affiliates
|
(9,580)
|
|
(8,756)
|
Interest
expense, net
|
37,114
|
|
43,605
|
|
5,052,507
|
|
4,266,204
|
Earnings before
income taxes and
|
|
|
|
noncontrolling
interests
|
515,912
|
|
548,975
|
Provision for
income taxes
|
135,800
|
|
171,327
|
Net
earnings
|
380,112
|
|
377,648
|
Earnings
attributable to
|
|
|
|
noncontrolling
interests
|
25,933
|
|
20,749
|
Net earnings
attributable to
|
|
|
|
Nucor
stockholders
|
$
354,179
|
|
$
356,899
|
|
|
|
|
Net earnings per
share:
|
|
|
|
Basic
|
$1.11
|
|
$1.11
|
Diluted
|
$1.10
|
|
$1.11
|
|
|
|
|
Average shares
outstanding:
|
|
|
|
Basic
|
319,421
|
|
320,224
|
Diluted
|
320,474
|
|
321,146
|
|
|
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS (Unaudited)
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
2018
|
|
Dec. 31,
2017
|
ASSETS
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
Cash and
cash equivalents
|
|
$
760,254
|
|
$
949,104
|
|
Short-term
investments
|
|
-
|
|
50,000
|
|
Accounts
receivable, net
|
|
2,371,758
|
|
2,028,545
|
|
Inventories,
net
|
|
3,708,503
|
|
3,461,686
|
|
Other
current assets
|
|
238,701
|
|
335,085
|
|
|
|
|
|
|
|
|
|
|
Total
current assets
|
|
7,079,216
|
|
6,824,420
|
|
|
|
|
|
|
|
|
Property,
plant and equipment, net
|
|
5,090,890
|
|
5,093,147
|
|
|
|
|
|
|
|
|
Goodwill
|
|
|
2,195,565
|
|
2,196,058
|
|
|
|
|
|
|
|
|
Other
intangible assets, net
|
|
892,121
|
|
914,646
|
|
|
|
|
|
|
|
|
Other
assets
|
|
863,454
|
|
812,987
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
16,121,246
|
|
$
15,841,258
|
|
|
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
Short-term
debt
|
|
$
74,036
|
|
$
52,833
|
|
Long-term
debt due within one year
|
|
500,000
|
|
500,000
|
|
Accounts
payable
|
|
1,329,902
|
|
1,181,346
|
|
Salaries,
wages and related accruals
|
|
338,045
|
|
516,660
|
|
Accrued
expenses and other current liabilities
|
|
602,598
|
|
573,925
|
|
|
|
|
|
|
|
|
|
|
Total
current liabilities
|
|
2,844,581
|
|
2,824,764
|
|
|
|
|
|
|
|
|
Long-term
debt due after one year
|
|
3,242,865
|
|
3,242,242
|
|
|
|
|
|
|
|
|
Deferred
credits and other liabilities
|
|
710,881
|
|
689,464
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities
|
|
6,798,327
|
|
6,756,470
|
|
|
|
|
|
|
|
|
EQUITY
|
|
|
|
|
|
Nucor
stockholders' equity:
|
|
|
|
|
|
Common
stock
|
|
152,061
|
|
151,960
|
|
Additional
paid-in capital
|
|
2,041,297
|
|
2,021,339
|
|
Retained
earnings
|
|
8,696,007
|
|
8,463,709
|
|
Accumulated
other comprehensive loss,
|
|
|
|
|
|
|
net of
income taxes
|
|
(249,366)
|
|
(254,681)
|
|
Treasury
stock
|
|
(1,663,972)
|
|
(1,643,291)
|
|
|
Total Nucor
stockholders' equity
|
|
8,976,027
|
|
8,739,036
|
|
|
|
|
|
|
|
|
Noncontrolling interests
|
|
346,892
|
|
345,752
|
|
|
|
|
|
|
|
|
|
|
Total
equity
|
|
9,322,919
|
|
9,084,788
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities and equity
|
|
$
16,121,246
|
|
$
15,841,258
|
|
|
|
|
|
|
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months (13
Weeks) Ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
2018
|
|
April 1,
2017
|
|
|
|
|
|
|
|
|
|
Operating
activities:
|
|
|
|
|
|
|
Net
earnings
|
|
|
$
380,112
|
|
$
377,648
|
|
Adjustments:
|
|
|
|
|
|
|
|
Depreciation
|
|
|
158,665
|
|
158,525
|
|
|
Amortization
|
|
|
22,453
|
|
22,368
|
|
|
Stock-based
compensation
|
|
10,463
|
|
9,524
|
|
|
Deferred income
taxes
|
|
29,988
|
|
(6,695)
|
|
|
Distributions from
affiliates
|
|
25,150
|
|
30,249
|
|
|
Equity in earnings
of unconsolidated affiliates
|
(9,580)
|
|
(8,756)
|
|
|
Changes in assets
and liabilities (exclusive of acquisitions and
dispositions):
|
|
|
|
|
|
|
Accounts
receivable
|
|
(343,982)
|
|
(290,261)
|
|
|
|
Inventories
|
|
|
(246,933)
|
|
(519,902)
|
|
|
|
Accounts
payable
|
|
214,399
|
|
413,256
|
|
|
|
Federal income
taxes
|
|
86,746
|
|
157,346
|
|
|
|
Salaries, wages
and related accruals
|
(171,626)
|
|
(102,744)
|
|
|
|
Other operating
activities
|
|
28,629
|
|
3,584
|
|
|
|
|
|
|
|
|
|
Cash provided by
operating activities
|
|
184,484
|
|
244,142
|
|
|
|
|
|
|
|
|
|
Investing
activities:
|
|
|
|
|
|
|
Capital
expenditures
|
|
|
(228,766)
|
|
(94,535)
|
|
Investment in and
advances to affiliates
|
(55,901)
|
|
(14,000)
|
|
Disposition of
plant and equipment
|
|
5,967
|
|
8,870
|
|
Acquisitions (net
of cash acquired)
|
|
-
|
|
(485,060)
|
|
Purchases of
investments
|
|
-
|
|
(50,000)
|
|
Proceeds from the
sale of investments
|
|
50,000
|
|
150,000
|
|
Other investing
activities
|
|
975
|
|
-
|
|
|
|
|
|
|
|
|
|
Cash used in
investing activities
|
|
(227,725)
|
|
(484,725)
|
|
|
|
|
|
|
|
|
|
Financing
activities:
|
|
|
|
|
|
|
Net change in
short-term debt
|
|
21,203
|
|
30,180
|
|
Issuance of common
stock
|
|
15,312
|
|
7,432
|
|
Payment of tax
withholdings on certain stock-based compensation
|
(4,430)
|
|
(1,349)
|
|
Distributions to
noncontrolling interests
|
(24,793)
|
|
(61,544)
|
|
Cash
dividends
|
|
|
(121,787)
|
|
(121,303)
|
|
Acquisition of
treasury stock
|
|
(29,193)
|
|
-
|
|
Other financing
activities
|
|
(1,844)
|
|
(518)
|
|
|
|
|
|
|
|
|
|
Cash used in
financing activities
|
|
(145,532)
|
|
(147,102)
|
|
|
|
|
|
|
|
|
|
Effect of exchange
rate changes on cash
|
|
(77)
|
|
(517)
|
|
|
|
|
|
|
|
|
|
(Decrease)
increase in cash and cash equivalents
|
(188,850)
|
|
(388,202)
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents - beginning of year
|
949,104
|
|
2,045,961
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents - end of three months
|
$
760,254
|
|
$
1,657,759
|
|
|
|
|
|
|
|
|
|
Non-cash investing
activity:
|
|
|
|
|
|
|
Change in accrued
plant and equipment purchases and assets recorded
|
|
|
|
|
under capital lease
arrangements
|
|
$
(65,959)
|
|
$
(11,222)
|
|
|
|
|
|
|
|
|
|
View original
content:http://www.prnewswire.com/news-releases/nucor-reports-results-for-first-quarter-of-2018-300632905.html
SOURCE Nucor Corporation