Nucor Announces Guidance For Its Fourth Quarter Earnings

News provided by

Dec 16, 2015, 09:00 ET

CHARLOTTE, N.C., Dec. 16, 2015 /PRNewswire/ -- Nucor Corporation (NYSE: NUE) announced today guidance for the fourth quarter ending December 31, 2015. Nucor expects fourth quarter results to be in the range of $0.15 to $0.20 per diluted share. This range is a decrease from both the fourth quarter of 2014 earnings of $0.65 per diluted share and the third quarter of 2015 earnings of $0.71 per diluted share.

Projected fourth quarter of 2015 results include a LIFO credit of $181.0 million ($0.34 per diluted share), compared with a credit of $137.0 million ($0.27 per diluted share) in the third quarter of 2015 and a credit of $57.3 million ($0.11 per diluted share) in the fourth quarter of 2014. Included in the third quarter of 2015 results was an out-of-period non-cash gain of $10.2 million ($0.03 per diluted share) related to a correction of deferred tax balances. The fourth quarter of 2014 results were impacted by approximately $8.9 million ($0.02 per diluted share) of inventory-related purchase accounting adjustments associated with the acquisition of Nucor Steel Gallatin and a $9.2 million ($0.03 per diluted share) out-of-period non-cash gain related to a correction to tax balances.

Operating performance at the steel mills segment in the fourth quarter of 2015 is expected to decrease from the third quarter of 2015. Our sheet and bar steel mills in particular have experienced decreased margins as selling prices have eroded more than the decline in raw material pricing. This performance is due to continued deterioration in global steel markets amplified by global excess capacity and historically high import levels. Although the trade remedy process has not moved as quickly as we would like, we believe that preliminary antidumping and countervailing duties and affirmative critical circumstances findings in the steel sheet cases should have a positive impact on domestic sheet mills in the first half of 2016. Nonresidential construction markets, although improved from 2014, are beginning to slow mainly due to seasonal factors. Energy, heavy equipment and agricultural markets remain weak. The automotive market remains strong.

The performance of our downstream products segment is expected to decrease from the third quarter of 2015 due to typical fourth quarter seasonality, but it is expected to increase from the fourth quarter of 2014. This performance compared to the prior year reflects the gradual improvement in nonresidential construction markets. We expect lower performance in the raw materials segment due to lower scrap and metallic commodity prices at our scrap processing businesses. During the fourth quarter of 2015, we will complete a planned maintenance outage at Nucor Steel Louisiana. The Louisiana direct reduced iron (DRI) facility will not resume operations after completion of the planned maintenance outage until market prices of alternative raw materials improve from current depressed levels.

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 2014 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