CHARLOTTE, N.C., Jan. 30, 2018 /PRNewswire/ -- Nucor
Corporation (NYSE: NUE) announced today consolidated net earnings
of $383.9 million, or $1.20 per diluted share, for the fourth quarter
of 2017. By comparison, Nucor reported consolidated net earnings of
$254.9 million, or $0.79 per diluted share, for the third quarter of
2017 and $159.6 million, or
$0.50 per diluted share, for the
fourth quarter of 2016.
Nucor reported consolidated net earnings of $1.32 billion, or $4.10 per diluted share, for fiscal 2017 compared
to $796.3 million, or $2.48 per diluted share for fiscal 2016.
Earnings (loss) before income taxes and noncontrolling interests
by segment were as follows for the fourth quarter and full year
2017 and 2016 (in thousands):
|
|
Three Months (13
Weeks) Ended
|
|
Twelve Months (52
Weeks) Ended
|
|
|
Dec. 31,
2017
|
|
Dec. 31,
2016
|
|
Dec. 31,
2017
|
|
Dec. 31,
2016
|
Steel
mills
|
|
$
349,958
|
|
$
321,270
|
|
$
2,084,203
|
|
$
1,724,168
|
Steel
products
|
|
74,849
|
|
52,079
|
|
206,805
|
|
249,970
|
Raw
materials
|
|
26,721
|
|
(18,881)
|
|
129,296
|
|
(95,121)
|
Corporate/eliminations
|
(129,287)
|
|
(99,428)
|
|
(670,347)
|
|
(580,358)
|
|
|
$
322,241
|
|
$
255,040
|
|
$
1,749,957
|
|
$
1,298,659
|
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. Future expenses or benefits related to the new legislation
may need to be recorded as additional guidance and clarification of
certain aspects of the legislation are provided, but cannot be
estimated at this time. Third quarter of 2017 results included a
net benefit totaling $13.2 million,
or $0.04 per diluted share, related
to tax return true-ups and state credits. Also included in the
third quarter of 2017 earnings was an expense of $22.5 million, or $0.05 per diluted share, related to certain legal
matters. Included in the fourth quarter of 2016 results were the
effects of a change in estimate related to the cost of certain
inventories that resulted in a benefit of $77.6 million, or $0.16 per diluted share.
Nucor's consolidated net sales decreased 2% to $5.09 billion in the fourth quarter of 2017
compared with $5.17 billion in the
third quarter of 2017 and increased 29% compared with $3.96 billion in the fourth quarter of 2016.
Average sales price per ton was comparable with the third quarter
of 2017 and increased 14% compared to the fourth quarter of 2016.
Total tons shipped to outside customers were 6,542,000 tons in the
fourth quarter of 2017, a 1% decrease from the third quarter of
2017 and an increase of 13% from the fourth quarter of 2016. Total
fourth quarter steel mill shipments decreased 2% from the third
quarter of 2017 and increased 18% from the fourth quarter of 2016.
Fourth quarter downstream steel products shipments to outside
customers decreased 3% from the third quarter of 2017 and increased
13% from the fourth quarter of 2016.
For fiscal 2017, Nucor's consolidated net sales increased 25% to
$20.25 billion, compared with
$16.21 billion for fiscal 2016. Total
tons shipped to outside customers in fiscal 2017 were 26,492,000,
an increase of 9% from fiscal 2016, while average sales price per
ton increased 15%.
The average scrap and scrap substitute cost per ton used in the
fourth quarter of 2017 was $317,
unchanged from the third quarter of 2017 and a 34% increase
compared to $236 in the fourth
quarter of 2016. The average scrap and scrap substitute cost per
ton used for the full year 2017 was $307, a 35% increase from $228 in for the full year 2016.
Overall operating rates at our steel mills decreased to 81% in
the fourth quarter of 2017 as compared to 83% in the third quarter
of 2017 and increased compared to 72% in the fourth quarter of
2016. Steel mill operating rates for the full year 2017 increased
to 85% as compared to 78% for the full year 2016.
Total steel mill energy costs in the fourth quarter of 2017
decreased approximately $2 per ton
compared to the third quarter of 2017 and decreased approximately
$1 compared to the fourth quarter of
2016. The decrease from the third quarter of 2017 was due to lower
electricity unit costs and the decrease from the fourth quarter of
2016 was due to improved steel mill productivity as well as lower
unit costs for electricity and natural gas. Energy costs for the
full year 2017 increased approximately $1 per ton from the full year 2016 due to higher
unit costs for electricity and natural gas.
Our liquidity position remains strong with $999.1 million in cash and cash equivalents and
short-term investments and an untapped $1.5
billion revolving credit facility that does not expire until
April 2021.
In November, Nucor announced that it will build a full-range
merchant bar quality (MBQ) mill at its existing steel mill located
in Bourbonnais, Illinois. The MBQ
mill is expected to have an annual capacity of approximately
500,000 tons and to cost $180
million. We anticipate the project will take approximately
two years to complete. This project will allow Nucor to fully
utilize the Company's existing bar mill by optimizing its melt
capacity and infrastructure. It will also take advantage of a scrap
supply that is currently abundant in the region, as well as the
Company's commercial footprint in the central United States.
Also in November, Nucor announced that it will build a rebar
micro mill in Sedalia, Missouri,
about 90 miles east of Kansas
City. This project represents at least $250 million in new investments. The new micro
mill is expected to start-up in 2019 pending the final approval and
awarding of state and local incentives as well as required permits
and regulatory approvals. Rebar supply to the Kansas City, upper Midwestern and Plains
markets currently travels long distances, giving the micro mill in
Sedalia a logistical advantage.
This location will also allow the company to take advantage of the
scrap supply that is currently abundant in the immediate area
provided by Nucor's scrap business, The David J. Joseph
Company.
In December, Nucor's board of directors declared a cash dividend
of $0.38 per share payable on
February 9, 2018 to stockholders of
record on December 29, 2017. This
dividend is Nucor's 179th consecutive quarterly cash
dividend, and it marks 45 consecutive
years of an increased base dividend.
Imports continue to negatively impact the U.S. steel industry.
Total steel imports in 2017 increased by more than five million net
tons, or 15.5%, compared to 2016. Additionally, finished steel
imports accounted for an estimated 27% share of the U.S. market.
Along with other domestic steel producers, Nucor continues to
pursue trade cases to combat unfairly traded imports. In 2017, the
United States Department of Commerce made several rulings imposing
duties on additional steel products that are favorable to the
domestic steel industry. In December, the Commerce Department made
a preliminary determination that corrosion-resistant and
cold-rolled steel from Vietnam
that originated in China evaded
U.S. anti-dumping and anti-subsidy orders. As a petitioner in the
case, Nucor believes the preliminary determination is an important
step in fighting efforts to circumvent trade duties. A final
determination is expected to be announced in the next few months.
We are encouraged by the steady progress that we are achieving
through the prosecution of product and country specific trade
cases, although the process is still slower than we believe is
appropriate. We attribute this success to date to the overwhelming
evidence that many foreign competitors receive support from illegal
subsidies.
The profitability of the steel mills segment in the fourth
quarter of 2017 decreased from the third quarter of 2017 due to
margin compression as imports, which surged in the summer of 2017,
continued to work through to our end markets. Weakness in plate
steel negatively impacted the earnings of the steel mills segment
in the fourth quarter of 2017 as compared to the third quarter of
2017. The performance of the steel products segment during the
fourth quarter of 2017 improved compared to the third quarter of
2017. The performance of the raw materials segment in the fourth
quarter of 2017 was better compared to the third quarter of 2017
due to the improved performance of our direct reduced iron
facilities.
Earnings in the first quarter of 2018 are expected to increase
compared to the fourth quarter of 2017, exclusive of the benefit
recorded in the fourth quarter of 2017 related to tax reform. We
believe there is significant optimism in steel end use markets and
are encouraged by positive pricing momentum building throughout the
quarter for all of our steel mill products. Coupled with these
positive trends, first quarter of 2018 results will be negatively
impacted by higher scrap prices and weather related interruptions
at some of our sheet mills. We expect decreased earnings in the
steel products segment due to typical seasonality. We expect
earnings in our raw materials segment in the first quarter of 2018
to improve compared to the fourth quarter of 2017.
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 fourth
quarter results on January 30, 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
|
|
Twelve
Months (52 Weeks) Ended
|
|
|
Dec. 31,
2017
|
|
Dec. 31,
2016
|
|
Percentage
Change
|
|
Dec. 31,
2017
|
|
Dec. 31,
2016
|
|
Percentage
Change
|
Steel mills total
shipments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Sheet
|
2,566
|
|
2,225
|
|
15%
|
|
10,607
|
|
9,735
|
|
9%
|
|
Tubular
products
|
225
|
|
86
|
|
162%
|
|
917
|
|
86
|
|
966%
|
|
Bars
|
1,982
|
|
1,794
|
|
10%
|
|
8,009
|
|
7,307
|
|
10%
|
|
Structural
|
557
|
|
511
|
|
9%
|
|
2,295
|
|
2,332
|
|
-2%
|
|
Plate
|
556
|
|
471
|
|
18%
|
|
2,300
|
|
2,041
|
|
13%
|
|
Other
|
173
|
|
64
|
|
170%
|
|
590
|
|
440
|
|
34%
|
|
|
6,059
|
|
5,151
|
|
18%
|
|
24,718
|
|
21,941
|
|
13%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales tons to
outside customers:
|
|
|
|
|
|
|
|
|
|
|
|
|
Steel
mills
|
4,998
|
|
4,400
|
|
14%
|
|
20,618
|
|
18,846
|
|
9%
|
|
Joist
|
140
|
|
123
|
|
14%
|
|
472
|
|
445
|
|
6%
|
|
Deck
|
128
|
|
110
|
|
16%
|
|
457
|
|
442
|
|
3%
|
|
Cold
finished
|
126
|
|
98
|
|
29%
|
|
487
|
|
426
|
|
14%
|
|
Fabricated
concrete
|
|
|
|
|
|
|
|
|
|
|
|
|
reinforcing
steel
|
285
|
|
258
|
|
10%
|
|
1,142
|
|
1,115
|
|
2%
|
|
Other
|
865
|
|
826
|
|
5%
|
|
3,316
|
|
3,035
|
|
9%
|
|
|
6,542
|
|
5,815
|
|
13%
|
|
26,492
|
|
24,309
|
|
9%
|
CONDENSED
CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited)
|
(In thousands,
except per share data)
|
|
|
|
|
|
|
|
|
|
Three Months (13
Weeks) Ended
|
|
Twelve Months (52
Weeks) Ended
|
|
|
|
|
|
|
|
|
|
Dec. 31,
2017
|
|
Dec. 31,
2016
|
|
Dec. 31,
2017
|
|
Dec. 31,
2016
|
|
|
|
|
|
|
|
|
Net
sales
|
$
5,092,328
|
|
$
3,956,538
|
|
$
20,252,393
|
|
$
16,208,122
|
|
|
|
|
|
|
|
|
Costs, expenses
and other:
|
|
|
|
|
|
|
|
Cost of
products sold
|
4,571,760
|
|
3,513,112
|
|
17,682,986
|
|
14,182,215
|
Marketing,
administrative and other expenses
|
168,102
|
|
156,082
|
|
687,531
|
|
596,761
|
Equity in
earnings of unconsolidated affiliates
|
(11,860)
|
|
(8,525)
|
|
(41,661)
|
|
(38,757)
|
Interest
expense, net
|
42,085
|
|
40,829
|
|
173,580
|
|
169,244
|
|
4,770,087
|
|
3,701,498
|
|
18,502,436
|
|
14,909,463
|
Earnings before
income taxes and
|
|
|
|
|
|
|
|
noncontrolling
interests
|
322,241
|
|
255,040
|
|
1,749,957
|
|
1,298,659
|
Provision for
income taxes
|
(72,853)
|
|
79,855
|
|
369,386
|
|
398,243
|
Net
earnings
|
395,094
|
|
175,185
|
|
1,380,571
|
|
900,416
|
Earnings
attributable to
|
|
|
|
|
|
|
|
noncontrolling
interests
|
11,203
|
|
15,546
|
|
61,883
|
|
104,145
|
Net earnings
attributable to
|
|
|
|
|
|
|
|
Nucor
stockholders
|
$
383,891
|
|
$
159,639
|
|
$
1,318,688
|
|
$
796,271
|
|
|
|
|
|
|
|
|
Net earnings per
share:
|
|
|
|
|
|
|
|
Basic
|
$1.20
|
|
$0.50
|
|
$4.11
|
|
$2.48
|
Diluted
|
$1.20
|
|
$0.50
|
|
$4.10
|
|
$2.48
|
|
|
|
|
|
|
|
|
Average shares
outstanding:
|
|
|
|
|
|
|
|
Basic
|
319,210
|
|
319,921
|
|
319,990
|
|
319,563
|
Diluted
|
319,967
|
|
320,396
|
|
320,773
|
|
319,822
|
CONDENSED
CONSOLIDATED BALANCE SHEETS (Unaudited)
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
Dec. 31,
2017
|
|
Dec. 31,
2016
|
ASSETS
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and
cash equivalents
|
$
949,104
|
|
$
2,045,961
|
|
Short-term
investments
|
50,000
|
|
150,000
|
|
Accounts
receivable, net
|
2,028,545
|
|
1,631,676
|
|
Inventories,
net
|
3,461,686
|
|
2,479,958
|
|
Other
current assets
|
335,085
|
|
198,798
|
|
|
|
|
|
|
|
|
|
Total
current assets
|
6,824,420
|
|
6,506,393
|
|
|
|
|
|
|
|
Property,
plant and equipment, net
|
5,093,147
|
|
5,078,650
|
|
|
|
|
|
|
|
Goodwill
|
|
2,196,058
|
|
2,052,728
|
|
|
|
|
|
|
|
Other
intangible assets, net
|
914,646
|
|
866,835
|
|
|
|
|
|
|
|
Other
assets
|
812,987
|
|
718,912
|
|
|
|
|
|
|
|
|
|
Total
assets
|
$
15,841,258
|
|
$
15,223,518
|
|
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Short-term
debt
|
$
52,833
|
|
$
17,959
|
|
Long-term
debt due within one year
|
500,000
|
|
600,000
|
|
Accounts
payable
|
1,181,346
|
|
838,109
|
|
Salaries,
wages and related accruals
|
516,660
|
|
428,829
|
|
Accrued
expenses and other current liabilities
|
573,925
|
|
505,069
|
|
|
|
|
|
|
|
|
|
Total
current liabilities
|
2,824,764
|
|
2,389,966
|
|
|
|
|
|
|
|
Long-term
debt due after one year
|
3,242,242
|
|
3,739,141
|
|
|
|
|
|
|
|
Deferred
credits and other liabilities
|
689,464
|
|
839,703
|
|
|
|
|
|
|
|
|
|
Total
liabilities
|
6,756,470
|
|
6,968,810
|
|
|
|
|
|
|
|
EQUITY
|
|
|
|
|
Nucor
stockholders' equity:
|
|
|
|
|
Common
stock
|
151,960
|
|
151,734
|
|
Additional
paid-in capital
|
2,021,339
|
|
1,974,672
|
|
Retained
earnings
|
8,463,709
|
|
7,630,916
|
|
Accumulated
other comprehensive loss,
|
|
|
|
|
|
net of
income taxes
|
(254,681)
|
|
(317,843)
|
|
Treasury
stock
|
(1,643,291)
|
|
(1,559,614)
|
|
|
Total Nucor
stockholders' equity
|
8,739,036
|
|
7,879,865
|
|
|
|
|
|
|
|
Noncontrolling
interests
|
345,752
|
|
374,843
|
|
|
|
|
|
|
|
|
|
Total
equity
|
9,084,788
|
|
8,254,708
|
|
|
|
|
|
|
|
|
|
Total
liabilities and equity
|
$
15,841,258
|
|
$
15,223,518
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months (52
Weeks) Ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dec. 31,
2017
|
|
Dec. 31,
2016
|
|
|
|
|
|
|
|
Operating
activities:
|
|
|
|
|
|
|
Net
earnings
|
|
|
$
1,380,571
|
|
$
900,416
|
|
Adjustments:
|
|
|
|
|
|
|
|
Depreciation
|
|
|
635,833
|
|
613,192
|
|
|
Amortization
|
|
|
91,228
|
|
73,862
|
|
|
Stock-based
compensation
|
|
64,176
|
|
56,511
|
|
|
Deferred income
taxes
|
|
(221,173)
|
|
71,455
|
|
|
Distributions from
affiliates
|
|
49,295
|
|
40,602
|
|
|
Equity in earnings
of unconsolidated affiliates
|
(41,661)
|
|
(38,757)
|
|
|
Changes in assets
and liabilities (exclusive of acquisitions and
dispositions):
|
|
|
|
|
|
|
Accounts
receivable
|
|
(329,501)
|
|
(217,736)
|
|
|
|
Inventories
|
|
(900,946)
|
|
(132,639)
|
|
|
|
Accounts
payable
|
|
314,817
|
|
236,788
|
|
|
|
Federal income
taxes
|
|
(107,577)
|
|
3,555
|
|
|
|
Salaries, wages
and related accruals
|
83,625
|
|
133,544
|
|
|
|
Other operating
activities
|
32,576
|
|
9,127
|
|
|
|
|
|
|
|
|
|
Cash provided by
operating activities
|
|
1,051,263
|
|
1,749,920
|
|
|
|
|
|
|
|
|
|
Investing
activities:
|
|
|
|
|
|
|
Capital
expenditures
|
|
(448,555)
|
|
(604,840)
|
|
Investment in and
advances to affiliates
|
(59,000)
|
|
(63,167)
|
|
Divestiture of
affiliates
|
|
-
|
|
135,000
|
|
Disposition of
plant and equipment
|
25,315
|
|
18,571
|
|
Acquisitions (net
of cash acquired)
|
(544,041)
|
|
(474,788)
|
|
Purchases of
investments
|
|
(50,000)
|
|
(650,000)
|
|
Proceeds from the
sale of investments
|
150,000
|
|
600,000
|
|
Other investing
activities
|
|
7,389
|
|
14,106
|
|
|
|
|
|
|
|
|
|
Cash used in
investing activities
|
|
(918,892)
|
|
(1,025,118)
|
|
|
|
|
|
|
|
|
|
Financing
activities:
|
|
|
|
|
|
|
Net change in
short-term debt
|
|
34,872
|
|
(33,360)
|
|
Repayment of
long-term debt
|
|
(600,000)
|
|
-
|
|
Issuance of common
stock
|
|
11,145
|
|
15,751
|
|
Payment of tax
withholdings on certain stock-based compensation
|
(14,408)
|
|
(12,387)
|
|
Excess tax
benefits from stock-based compensation
|
-
|
|
2,784
|
|
Distributions to
noncontrolling interests
|
(90,974)
|
|
(99,588)
|
|
Cash
dividends
|
|
|
(485,321)
|
|
(481,083)
|
|
Acquisition of
treasury stock
|
|
(90,304)
|
|
(5,173)
|
|
Other financing
activities
|
|
(3,241)
|
|
(13,297)
|
|
|
|
|
|
|
|
|
|
Cash used in
financing activities
|
|
(1,238,231)
|
|
(626,353)
|
|
|
|
|
|
|
|
|
|
Effect of exchange
rate changes on cash
|
9,003
|
|
8,043
|
|
|
|
|
|
|
|
|
|
(Decrease)
increase in cash and cash equivalents
|
(1,096,857)
|
|
106,492
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents - beginning of year
|
2,045,961
|
|
1,939,469
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents - end of year
|
$
949,104
|
|
$
2,045,961
|
|
|
|
|
|
|
|
|
|
Non-cash investing
activity:
|
|
|
|
|
|
Change in accrued
plant and equipment purchases and
|
|
|
|
|
assets acquired by
capital lease arrangements
|
$
58,519
|
|
$
12,837
|
|
|
|
|
|
|
|
|
|
View original
content:http://www.prnewswire.com/news-releases/nucor-reports-results-for-fourth-quarter-and-year-ended-2017-300590209.html
SOURCE Nucor Corporation