CHARLOTTE, N.C., Dec. 15, 2016 /PRNewswire/ -- Nucor
Corporation (NYSE: NUE) announced today guidance for its fourth quarter ending December 31, 2016.
Nucor expects fourth quarter results to be in the range of $0.30 to $0.35 per diluted
share. This range is a decrease compared to the third quarter of 2016 consolidated net earnings of $0.84 per diluted share and a decrease compared to the fourth quarter of 2015 adjusted net earnings of
$0.45 per diluted share. Fourth quarter of 2015 adjusted net earnings excludes $0.64 of impairment charges recorded during the quarter. Including these impairment charges, Nucor's net loss
for the fourth quarter of 2015 was $0.19 per diluted share.
Projected fourth quarter of 2016 results include an estimated LIFO expense of $35.3 million
($0.07 per diluted share), compared to an expense of $59.3 million
($0.12 per diluted share) in the third quarter of 2016 and a credit of $217.8 million ($0.41 per diluted share) in the fourth quarter of 2015. Included
in the third quarter of 2016 results were charges related to legal settlements of $33.7 million
($0.06 per diluted share) and a net benefit of $11.1 million
($0.02 per diluted share) related to fair value adjustments to assets in the corporate/eliminations
segment. The impairment charges recorded in the fourth quarter of 2015 noted above were made up of a $153.0 million ($0.47 per diluted share) impairment charge related to our
Duferdofin Nucor S.r.l. joint venture and an $84.1 million ($0.17 per
diluted share) impairment charge on assets related to a blast furnace project that will not be utilized in the future.
Trade cases initiated by the U.S. steel industry targeting several product groups are having a positive impact as steel
imports are down approximately 19% this year compared to last year. Affirmative final determinations announced earlier this year
in cases involving three flat-rolled products - corrosion-resistant, cold-rolled and hot-rolled steel - are an important step in
returning fair trade to the U.S. flat-rolled steel market. In addition, the U.S. Department of Commerce recently released
preliminary duty determinations in investigations addressing cut-to-length plate from twelve countries. The U.S. Department of
Commerce also announced the initiation of antidumping duty investigations of imports of steel concrete reinforcing bar from
Japan, Taiwan, and Turkey, and
a countervailing duty investigation of steel concrete reinforcing bar imports from Turkey. We
expect the plate and rebar cases to conclude in 2017.
The expected decline in earnings in the fourth quarter of 2016 compared to the third quarter of 2016 is primarily due to lower
margins in the steel mills segment, with the most significant impact at our sheet mills. The performance of the raw materials
segment in the fourth quarter of 2016 will decline significantly compared to the third quarter of 2016 as it returns to a loss
position due to lower pricing at our DRI facilities in the fourth quarter. We expect decreased profitability for our steel
products segment in the fourth quarter of 2016 as compared to the third quarter of 2016 due to end of year seasonality that is
typical in the fourth quarter.
Market conditions for the steel mills segment have been marked by volatility in sales prices and demand during 2016. Looking
ahead to 2017, we are optimistic about continued improvement in market conditions. Prices have increased throughout the fourth
quarter for our sheet, bar, structural and plate mills. Scrap and other commodities prices have been increasing as we approach
the end of the year. Service center inventory levels remain low. We believe higher input costs and declining imports are now
causing the market to find an improved and more sustainable level that we expect to benefit 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; 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 2015 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.
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SOURCE Nucor Corporation