Nucor Announces Guidance For Its First Quarter Earnings

News provided by

Mar 15, 2016, 09:00 ET

CHARLOTTE, N.C., March 15, 2016 /PRNewswire/ -- Nucor Corporation (NYSE: NUE) announced today guidance for its first quarter ending April 2, 2016. Nucor expects first quarter results to be in the range of $0.20 to $0.25 per diluted share. This range is comparable to the first quarter of 2015 earnings of $0.21 per diluted share and a decrease from 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 first quarter of 2016 results include an estimated LIFO expense of $15.0 million ($0.03 per diluted share), compared to a credit of $217.8 million ($0.41 per diluted share) in the fourth quarter of 2015 and a credit of $16.5 million ($0.03 per diluted share) in the first quarter of 2015. LIFO charges or credits for interim periods are based on management's current estimates of both inventory costs and quantities expected at year-end, and that full year estimate is incurred ratably over the remainder of the year.

Operating performance at the steel mills segment for the first quarter of 2016 is expected to benefit from a lower average cost of inventory at the beginning of the first quarter and a modest improvement in market conditions. Positive market factors include a small decline in import volumes and more balanced inventory levels at service center customers. Nonresidential construction markets have slowed due to seasonal factors and are expected to improve as the year progresses. Energy, heavy equipment and agricultural markets remain weak. The automotive market remains strong.

Imports also continue to impact the U.S. steel industry. Several important trade cases are in progress, and the Department of Commerce has announced preliminary duties. We are confident that once all the facts are known, final determinations by the Department of Commerce will fully address all dumping and subsidies associated with these cases.

Although conditions in world markets remain uncertain, we now believe that full year 2016 profitability will be slightly improved compared to full year 2015 results, excluding the impairment charges taken in the prior year. This improved performance is driven by expected increases in the performance of the steel mills and steel products segments.

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; 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.

SOURCE Nucor Corporation