Nucor Announces Guidance For Its Third Quarter Earnings
CHARLOTTE, N.C., Sept. 18, 2012
CHARLOTTE, N.C., Sept. 18, 2012 /PRNewswire/ --Nucor Corporation (NYSE: NUE)
announced today guidance for its third quarter ending September 29, 2012.
Nucor expects third quarter results to be in the range of $0.30 to $0.35 per
diluted share. These projected results are lower than the third quarter of
2011 earnings of $0.57 per diluted share and similar to the second quarter of
2012 earnings of $0.35 per diluted share. Third quarter of 2012 projected
results include the negative impact of approximately $26 million ($0.05 per
diluted share) of inventory purchase accounting adjustments related to our
acquisition of Skyline Steel LLC ("Skyline") and a loss on the sale of the
assets of Nucor Wire Products Pennsylvania, Inc. of $17.6 million ($0.04 per
diluted share). We expect minimal charges related to Skyline purchase
accounting adjustments in the fourth quarter. Earnings in the second quarter
of 2012 included an impairment charge related to our Duferdofin Nucor S.r.l.
joint venture of $0.09 per diluted share and a charge of $0.02 per diluted
share for purchase accounting adjustments and the elimination of profit
associated with our steel mills' sales to Skyline post-acquisition. Projected
third quarter results also include an estimated LIFO credit of $80.0 million
($0.16 per diluted share) compared to a credit of $14.5 million in the second
quarter of 2012 ($0.03 per diluted share) and a charge of $28.0 million in the
third quarter of 2011 ($0.05 per diluted share).
Our projected earnings for the third quarter of 2012 excluding one-time
charges are consistent with the qualitative guidance included in our earnings
release for the second quarter of 2012 which stated, "We currently expect to
see a modest reduction in earnings exclusive of one–time charges for the third
quarter of 2012."
Our lower performance in the third quarter of 2012 is mainly due to decreased
operating performance at our steel mills, which experienced decreased
profitability, particularly at our sheet mills, compared to the second quarter
of 2012. Lower steel mill margins are primarily the result of rising imports,
which began trending up at the end of 2011 and have continued through the
first nine months of 2012. Slowing economic growth both domestically and
globally are also factors. Volatility in scrap prices, together with a
combination of political and economic uncertainty in global markets that is
beginning to affect steel buyer confidence, has also disrupted supply chain
stocking levels. The strongest end markets continue to be manufactured goods
including heavy equipment, energy and automotive.
Nucor and 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; steel piling; steel joists
and joist girders; steel deck; fabricated concrete reinforcing steel; cold
finished steel; steel fasteners; metal building systems; steel grating and
expanded metal; 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) 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;
(2) market demand for steel products; (3) energy costs and availability; and
(4) competitive pressure on sales and pricing, including competition from
imports and substitute materials. These and other factors are outlined in
Nucor's regulatory filings with the Securities and Exchange Commission,
including those in Nucor's December 31, 2011 Annual Report on Form 10-K. 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.
SOURCE Nucor Corporation
Contact: Nucor Executive Offices, +1-704-366-7000, or fax, +1-704-362-4208
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