CHARLOTTE, N.C., July 20, 2017 /PRNewswire/ -- Nucor
Corporation (NYSE: NUE) announced today consolidated net earnings
of $323.0 million, or $1.00 per diluted share, for the second quarter
of 2017. By comparison, Nucor reported net earnings of $356.9 million, or $1.11 per diluted share, for the first quarter of
2017 and net earnings of $243.6
million, or $0.76 per diluted
share, for the second quarter of 2016.
In the first half of 2017, Nucor reported consolidated net
earnings of $679.9 million, or
$2.11 per diluted share, compared
with consolidated net earnings of $331.2
million, or $1.03 per diluted
share, in the first half of last year.
Earnings (loss) before income taxes and noncontrolling interests
by segment were as follows for the second quarter and first six
months of 2017 and 2016 (in thousands):
|
|
Three Months (13
Weeks) Ended
|
|
Six Months (26
Weeks) Ended
|
|
|
July 1,
2017
|
|
July 2,
2016
|
|
July 1,
2017
|
|
July 2,
2016
|
Steel
mills
|
|
$
617,366
|
|
$
530,727
|
|
$
1,301,527
|
|
$
811,099
|
Steel
products
|
|
45,809
|
|
82,946
|
|
72,731
|
|
125,313
|
Raw
materials
|
|
66,227
|
|
(27,181)
|
|
92,618
|
|
(90,553)
|
Corporate/eliminations
|
(221,266)
|
|
(196,608)
|
|
(409,765)
|
|
(286,412)
|
|
|
$
508,136
|
|
$
389,884
|
|
$
1,057,111
|
|
$
559,447
|
|
|
|
|
|
|
|
|
|
Included in the first quarter of 2017 earnings are 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 7% to $5.17 billion in the second quarter of 2017 from
$4.82 billion in the first quarter of
2017 and increased 22% compared with $4.25
billion in the second quarter of 2016. Average sales price
per ton in the second quarter of 2017 increased 5% from the first
quarter of 2017 and increased 17% from the second quarter of 2016.
Total tons shipped to outside customers were 6,748,000 tons in the
second quarter of 2017, a 2% increase from the first quarter of
2017 and a 5% increase from the second quarter of 2016. Total
second quarter steel mill shipments increased 3% from the first
quarter of 2017 and increased 7% from the second quarter of 2016.
Second quarter of 2017 downstream steel products shipments to
outside customers increased 9% from the first quarter of 2017 and
increased 1% from the second quarter of 2016.
In the first half of 2017, Nucor's consolidated net sales
increased 25% to $9.99 billion,
compared with $7.96 billion in last
year's first half, and total tons shipped to outside customers
increased 6% from the first half of 2016, while average sales price
per ton increased 19%.
The average scrap and scrap substitute cost per ton used during
the second quarter of 2017 was $313,
an increase of 10% from $284 in the
first quarter of 2017 and an increase of 35% compared with
$232 in the second quarter of 2016.
The average scrap and scrap substitute cost per ton used in the
first half of 2017 was $298, an
increase of 40% from $213 in the
first half of 2016.
Overall operating rates at our steel mills increased to 90% in
the second quarter of 2017 as compared to 89% in both the first
quarter of 2017 and the second quarter of 2016. Operating rates for
the first half of 2017 increased to 90% as compared with 84% for
the first half of 2016.
Total steel mill energy costs in the second quarter of 2017 were
comparable to the first quarter of 2017 and increased approximately
$2 per ton compared to the second
quarter of 2016, primarily due to higher natural gas unit costs.
Total steel mill energy costs for the first half of 2017 also
increased $2 per ton compared to the
first half of 2016 primarily due to higher natural gas unit
costs.
Our liquidity position remains strong with $1.6
billion in cash and cash equivalents and short-term
investments, as of July 1, 2017, and
an untapped $1.5 billion revolving
credit facility that does not expire until April 2021.
In May, Nucor announced that it is investing an estimated
$176 million to build a hot band
galvanizing and pickling line at its sheet mill in Ghent, Kentucky. The new galvanizing line will
expand Nucor Steel Gallatin's product capabilities and should have
an annual capacity of 500,000 tons. Once the necessary approvals
are obtained, it is expected to take two years to construct the
galvanizing line and begin operations.
In June, Nucor's board of directors declared a cash dividend of
$0.3775 per share payable on
August 11, 2017 to stockholders of
record on June 30, 2017. This
dividend is Nucor's 177th consecutive quarterly cash
dividend, a record we expect to continue.
Imports continue to negatively impact the U.S. steel industry.
Through the first half of 2017, finished steel imports have
increased an estimated 15% compared to the same period last year
and account for an estimated 27% share of the U.S. market. The
industry continues to pursue trade cases to combat unfairly traded
imports. Final determinations issued earlier this year against
cut-to-length steel plate imports from twelve countries are having
a positive impact as steel imports of these products have decreased
in the first six months of this year compared to the same period
last year. Last month, the U.S. International Trade Commission made
final injury determinations affirming the Department of Commerce's
antidumping duties in the steel concrete reinforcing bar (rebar)
case against Japan and
Turkey, as well as final
countervailing duties on rebar imports from Turkey. A final decision regarding
Taiwan is still pending. In
May, the government determined that there is a reasonable
indication that the U.S. steel industry is materially injured or
threatened with material injury by reason of carbon and certain
alloy steel wire rod imports from ten countries. As a result,
the government will continue its wire rod antidumping and
countervailing duty investigations, and is expected to issue
preliminary duty determinations in the coming months.
The performance of our steel mills segment, particularly of our
sheet mills and bar mills, decreased in the second quarter of 2017
as compared to the first quarter of 2017. Market conditions for
hot-rolled sheet products have been challenging due to aggressive
competition. The profitability of our plate mills improved in the
second quarter of 2017 as compared to the first quarter of 2017.
The performance of our downstream products segment improved in the
second quarter of 2017 as compared to the first quarter of 2017.
The profitability of the downstream products segment in the second
quarter of 2017 decreased from the second quarter of 2016 due to a
highly competitive market environment and margin compression
resulting from higher steel prices. In particular, our rebar
fabrication operations have experienced significant declines in
performance due to downward pressure on pricing caused by surges of
rebar imports. Our raw materials segment's performance increased in
the second quarter of 2017 as compared to the first quarter of 2017
due to the profitable performance of both of our direct reduced
iron facilities.
Earnings in the third quarter of 2017 should be in a range
similar to the quarterly results of the first half of 2017.
Nonresidential construction indicators, such as the Dodge Momentum
Index and Architecture Billings Index, continue to suggest that
construction activity will remain healthy through the end of the
year. We continue to gain ground in the automotive market and
expect to continue that trend through the remainder of the year. We
are encouraged by improved energy markets compared to the depressed
levels of 2015 and 2016.
In the fourth quarter of 2016, the Company changed its method of
accounting for certain inventories from the last-in, first-out
(LIFO) method to the first-in, first-out (FIFO) method, which
required retrospective application to prior period financial
statements. Accordingly, all amounts for prior periods presented in
this release are presented after the retrospective application of
the change in accounting principle.
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.
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)
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; (3) market demand for steel
products; and (4) 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 2016 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.
You are invited to listen to the live broadcast of Nucor's
conference call in which management will discuss Nucor's second
quarter results on July 20, 2017 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
|
|
Six Months
(26 Weeks) Ended
|
|
|
July 1,
2017
|
|
July 2,
2016
|
|
Percentage
Change
|
|
July 1,
2017
|
|
July 2,
2016
|
|
Percentage
Change
|
Steel mills total
shipments
|
|
|
|
|
|
|
|
|
|
|
|
|
Sheet
|
2,719
|
|
2,682
|
|
1%
|
|
5,424
|
|
5,250
|
|
3%
|
|
Tubular
products
|
227
|
|
-
|
|
|
|
450
|
|
-
|
|
|
|
Bars
|
2,001
|
|
1,960
|
|
2%
|
|
3,958
|
|
3,708
|
|
7%
|
|
Structural
|
588
|
|
596
|
|
-1%
|
|
1,199
|
|
1,197
|
|
-
|
|
Plate
|
614
|
|
600
|
|
2%
|
|
1,191
|
|
1,154
|
|
3%
|
|
Other
|
198
|
|
92
|
|
115%
|
|
272
|
|
268
|
|
1%
|
|
|
6,347
|
|
5,930
|
|
7%
|
|
12,494
|
|
11,577
|
|
8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales tons to
outside customers:
|
|
|
|
|
|
|
|
|
|
|
|
|
Steel
mills
|
5,322
|
|
5,082
|
|
5%
|
|
10,524
|
|
9,981
|
|
5%
|
|
Joist
|
104
|
|
95
|
|
9%
|
|
205
|
|
193
|
|
6%
|
|
Deck
|
104
|
|
108
|
|
-4%
|
|
210
|
|
209
|
|
-
|
|
Cold
finished
|
120
|
|
110
|
|
9%
|
|
242
|
|
229
|
|
6%
|
|
Fabricated
concrete
|
|
|
|
|
|
|
|
|
|
|
|
|
reinforcing
steel
|
291
|
|
304
|
|
-4%
|
|
538
|
|
546
|
|
-1%
|
|
Other
|
807
|
|
758
|
|
6%
|
|
1,613
|
|
1,447
|
|
11%
|
|
|
6,748
|
|
6,457
|
|
5%
|
|
13,332
|
|
12,605
|
|
6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited)
|
(In thousands,
except per share data)
|
|
|
|
|
|
|
|
|
|
Three
Months (13 Weeks) Ended
|
|
Six Months
(26 Weeks) Ended
|
|
|
|
|
|
|
|
|
|
July 1,
2017
|
|
July 2,
2016
|
|
July 1,
2017
|
|
July 2,
2016
|
|
|
|
|
|
|
|
|
Net
sales
|
$
5,174,769
|
|
$
4,245,772
|
|
$
9,989,948
|
|
$
7,961,348
|
|
|
|
|
|
|
|
|
Costs, expenses
and other:
|
|
|
|
|
|
|
|
Cost of
products sold
|
4,465,144
|
|
3,660,512
|
|
8,520,073
|
|
7,061,103
|
Marketing,
administrative and other expenses
|
170,211
|
|
161,711
|
|
346,637
|
|
271,456
|
Equity in
earnings of unconsolidated affiliates
|
(13,302)
|
|
(6,819)
|
|
(22,058)
|
|
(16,064)
|
Interest
expense, net
|
44,580
|
|
40,484
|
|
88,185
|
|
85,406
|
|
4,666,633
|
|
3,855,888
|
|
8,932,837
|
|
7,401,901
|
Earnings before
income taxes and
|
|
|
|
|
|
|
|
noncontrolling
interests
|
508,136
|
|
389,884
|
|
1,057,111
|
|
559,447
|
Provision for
income taxes
|
166,412
|
|
118,515
|
|
337,739
|
|
165,581
|
Net
earnings
|
341,724
|
|
271,369
|
|
719,372
|
|
393,866
|
Earnings
attributable to
|
|
|
|
|
|
|
|
noncontrolling
interests
|
18,676
|
|
27,749
|
|
39,425
|
|
62,681
|
Net earnings
attributable to
|
|
|
|
|
|
|
|
Nucor
stockholders
|
$
323,048
|
|
$
243,620
|
|
$
679,947
|
|
$
331,185
|
|
|
|
|
|
|
|
|
Net earnings per
share:
|
|
|
|
|
|
|
|
Basic
|
$1.00
|
|
$0.76
|
|
$2.12
|
|
$1.03
|
Diluted
|
$1.00
|
|
$0.76
|
|
$2.11
|
|
$1.03
|
|
|
|
|
|
|
|
|
Average shares
outstanding:
|
|
|
|
|
|
|
|
Basic
|
320,439
|
|
319,360
|
|
320,332
|
|
319,299
|
Diluted
|
321,226
|
|
319,578
|
|
321,186
|
|
319,435
|
|
|
|
|
|
|
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS (Unaudited)
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
July 1,
2017
|
|
Dec. 31,
2016
|
ASSETS
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and
cash equivalents
|
$
1,511,353
|
|
$
2,045,961
|
|
Short-term
investments
|
50,000
|
|
150,000
|
|
Accounts
receivable, net
|
2,081,150
|
|
1,631,676
|
|
Inventories,
net
|
3,326,563
|
|
2,479,958
|
|
Other
current assets
|
213,626
|
|
198,798
|
|
|
|
|
|
|
|
|
|
Total
current assets
|
7,182,692
|
|
6,506,393
|
|
|
|
|
|
|
|
Property,
plant and equipment, net
|
5,062,423
|
|
5,078,650
|
|
|
|
|
|
|
|
Goodwill
|
|
2,179,641
|
|
2,052,728
|
|
|
|
|
|
|
|
Other
intangible assets, net
|
946,978
|
|
866,835
|
|
|
|
|
|
|
|
Other
assets
|
740,991
|
|
718,912
|
|
|
|
|
|
|
|
|
|
Total
assets
|
$
16,112,725
|
|
$
15,223,518
|
|
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Short-term
debt
|
$
39,197
|
|
$
17,959
|
|
Long-term
debt due within one year
|
1,100,000
|
|
600,000
|
|
Accounts
payable
|
1,214,313
|
|
838,109
|
|
Salaries,
wages and related accruals
|
422,744
|
|
428,829
|
|
Accrued
expenses and other current liabilities
|
549,052
|
|
505,069
|
|
|
|
|
|
|
|
|
|
Total
current liabilities
|
3,325,306
|
|
2,389,966
|
|
|
|
|
|
|
|
Long-term
debt due after one year
|
3,240,694
|
|
3,739,141
|
|
|
|
|
|
|
|
Deferred
credits and other liabilities
|
834,812
|
|
839,703
|
|
|
|
|
|
|
|
|
|
Total
liabilities
|
7,400,812
|
|
6,968,810
|
|
|
|
|
|
|
|
EQUITY
|
|
|
|
|
Nucor
stockholders' equity:
|
|
|
|
|
Common
stock
|
151,920
|
|
151,734
|
|
Additional
paid-in capital
|
2,004,079
|
|
1,974,672
|
|
Retained
earnings
|
8,067,846
|
|
7,630,916
|
|
Accumulated
other comprehensive loss,
|
|
|
|
|
|
net of
income taxes
|
(292,935)
|
|
(317,843)
|
|
Treasury
stock
|
(1,553,845)
|
|
(1,559,614)
|
|
|
Total Nucor
stockholders' equity
|
8,377,065
|
|
7,879,865
|
|
|
|
|
|
|
|
Noncontrolling interests
|
334,848
|
|
374,843
|
|
|
|
|
|
|
|
|
|
Total
equity
|
8,711,913
|
|
8,254,708
|
|
|
|
|
|
|
|
|
|
Total
liabilities and equity
|
$
16,112,725
|
|
$
15,223,518
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months (26
Weeks) Ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
July 1,
2017
|
|
July 2,
2016
|
|
|
|
|
|
|
|
|
|
Operating
activities:
|
|
|
|
|
|
|
Net
earnings
|
|
|
$
719,372
|
|
$
393,866
|
|
Adjustments:
|
|
|
|
|
|
|
|
Depreciation
|
|
|
318,278
|
|
306,088
|
|
|
Amortization
|
|
|
45,443
|
|
35,587
|
|
|
Stock-based
compensation
|
|
41,159
|
|
37,576
|
|
|
Deferred income
taxes
|
|
(4,173)
|
|
11,687
|
|
|
Distributions from
affiliates
|
|
46,877
|
|
37,026
|
|
|
Equity in earnings
of unconsolidated affiliates
|
(22,058)
|
|
(16,064)
|
|
|
Changes in assets
and liabilities (exclusive of acquisitions and
dispositions):
|
|
|
|
|
|
|
Accounts
receivable
|
|
(396,452)
|
|
(398,266)
|
|
|
|
Inventories
|
|
(781,581)
|
|
(183,056)
|
|
|
|
Accounts
payable
|
|
371,158
|
|
452,815
|
|
|
|
Federal income
taxes
|
|
(14,114)
|
|
129,325
|
|
|
|
Salaries, wages
and related accruals
|
(5,794)
|
|
32,091
|
|
|
|
Other operating
activities
|
28,849
|
|
27,697
|
|
|
|
|
|
|
|
|
|
Cash provided by
operating activities
|
|
346,964
|
|
866,372
|
|
|
|
|
|
|
|
|
|
Investing
activities:
|
|
|
|
|
|
|
Capital
expenditures
|
|
(189,235)
|
|
(227,342)
|
|
Investment in and
advances to affiliates
|
(19,000)
|
|
(12,508)
|
|
Disposition of
plant and equipment
|
12,509
|
|
11,631
|
|
Acquisitions (net
of cash acquired)
|
(478,410)
|
|
-
|
|
Purchases of
investments
|
|
(50,000)
|
|
(550,000)
|
|
Proceeds from the
sale of investments
|
150,000
|
|
100,000
|
|
Other investing
activities
|
|
(990)
|
|
6,265
|
|
|
|
|
|
|
|
|
|
Cash used in
investing activities
|
|
(575,126)
|
|
(671,954)
|
|
|
|
|
|
|
|
|
|
Financing
activities:
|
|
|
|
|
|
|
Net change in
short-term debt
|
|
21,235
|
|
(31,375)
|
|
Issuance of common
stock
|
|
7,432
|
|
1,882
|
|
Payment of tax
withholdings on certain stock-based compensation
|
(13,185)
|
|
(9,407)
|
|
Excess tax
benefits from stock-based compensation
|
-
|
|
916
|
|
Distributions to
noncontrolling interests
|
(79,420)
|
|
(78,684)
|
|
Cash
dividends
|
|
|
(242,704)
|
|
(240,302)
|
|
Acquisition of
treasury stock
|
|
-
|
|
(5,173)
|
|
Other financing
activities
|
|
(1,101)
|
|
(4,630)
|
|
|
|
|
|
|
|
|
|
Cash used in
financing activities
|
|
(307,743)
|
|
(366,773)
|
|
|
|
|
|
|
|
|
|
Effect of exchange
rate changes on cash
|
1,297
|
|
14,036
|
|
|
|
|
|
|
|
|
|
Decrease in cash
and cash equivalents
|
(534,608)
|
|
(158,319)
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents - beginning of year
|
2,045,961
|
|
1,939,469
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents - end of six months
|
$
1,511,353
|
|
$
1,781,150
|
|
|
|
|
|
|
|
|
|
Non-cash investing
activity:
|
|
|
|
|
|
Change in accrued
plant and equipment purchases
|
$
(12,927)
|
|
$
2,630
|
|
|
|
|
|
|
|
|
|
View original
content:http://www.prnewswire.com/news-releases/nucor-reports-results-for-second-quarter-and-first-half-of-2017-300491471.html
SOURCE Nucor Corporation