CHARLOTTE, N.C., April 23, 2015 /PRNewswire/ -- Nucor Corporation
(NYSE: NUE) announced today consolidated net earnings of
$67.8 million, or $0.21 per diluted share, for the first quarter of
2015. By comparison, Nucor reported net earnings of $111.0 million, or $0.35 per diluted share, for the first quarter of
2014 and net earnings of $210.4
million, or $0.65 per diluted
share, for the fourth quarter of 2014.
Earnings (loss) before income taxes and noncontrolling interests
by segment were as follows for the first quarter of 2015 and 2014
(in thousands):
|
|
|
|
|
|
|
|
|
Three Months (13
Weeks) Ended
|
|
|
|
April 4,
2015
|
|
April 5,
2014
|
|
|
|
|
|
|
|
Steel
mills
|
|
$
217,128
|
|
$
317,797
|
|
Steel
products
|
|
32,458
|
|
1,720
|
|
Raw
materials
|
|
(41,497)
|
|
8,359
|
|
Corporate/eliminations
|
|
(89,044)
|
|
(120,375)
|
|
|
|
$
119,045
|
|
$
207,501
|
|
|
|
|
|
|
|
|
|
|
|
|
Nucor's results include a credit of $16.5
million ($0.03 per diluted
share) to value inventories using the last-in, first-out (LIFO)
method of accounting. The credit is compared with a charge of
$14.5 million ($0.03 per diluted share) in the first quarter of
2014 and a credit of $57.3 million
($0.11 per diluted share) in the
fourth quarter of 2014. Included in the fourth quarter of 2014
results were $8.9 million ($0.02 per diluted share) of non-cash
inventory related purchase accounting charges associated with the
acquisition of Nucor Steel Gallatin and a $13.2
million ($0.04 per diluted
share) out-of-period non-cash gain related to a correction to tax
balances. Included in the first quarter of 2014 earnings was a
$12.8 million ($0.04 per diluted share) charge primarily related
to tax legislation changes in the state of New York. Also included in first quarter of
2014 results was a $9.0 million
charge ($0.02 per diluted share)
related to the disposal of assets within the steel mills
segment.
Nucor's consolidated net sales decreased 14% to $4.40 billion in the first quarter of 2015 from
$5.11 billion in the first quarter of
2014 and decreased 12% compared with $5.00
billion in the fourth quarter of 2014. Average sales price
per ton in the first quarter of 2015 decreased 5% from both the
first quarter of 2014 and the fourth quarter of 2014. Total tons
shipped to outside customers were 5,635,000 tons in the first
quarter of 2015, a 9% decrease from the first quarter of 2014 and a
7% decrease from the fourth quarter of 2014. Total first quarter
steel mill shipments decreased 10% from the first quarter of 2014
and decreased 8% from the fourth quarter of 2014. First quarter
downstream steel products shipments to outside customers increased
1% over the first quarter of 2014 and decreased 4% from the fourth
quarter of 2014.
The average scrap and scrap substitute cost per ton used during
the first quarter of 2015 was $324, a
decrease of 19% from $398 in the
first quarter of 2014 and a decrease of 11% compared to
$363 in the fourth quarter of 2014.
We expect to further benefit from the large decrease in scrap
prices that occurred in February during the second quarter of 2015,
as we finish consuming scrap and pig iron purchased before the
February price correction.
Overall operating rates at our steel mills decreased to 65% in
the first quarter of 2015 as compared to 75% in the first quarter
of 2014 and 76% in the fourth quarter of 2014.
Total steel mill energy costs in the first quarter of 2015
decreased approximately $3 per ton
compared to the first quarter of 2014 and increased approximately
$2 per ton compared to the fourth
quarter of 2014. The decrease from the first quarter of 2014 was
primarily due to lower natural gas unit costs. The increase from
the fourth quarter of 2014 was due to reduced electricity
productivity caused by lower steel mill utilization rates and
slightly higher electricity unit costs.
Our liquidity position remains strong with $1.27
billion in cash and cash equivalents and short-term
investments and an untapped $1.5 billion revolving credit
facility that does not expire until August 2018. Nucor had no
commercial paper outstanding at the end of the first quarter of
2015.
In February, Nucor's board of directors declared a cash dividend
of $0.3725 per share payable on
May 11, 2015 to stockholders of
record on March 31, 2015. This
dividend is Nucor's 168th consecutive quarterly cash dividend, a
record we expect to continue.
Nucor Steel Louisiana successfully resumed operations late in
the first quarter following completion of repairs related to the
failure of the process gas heater that occurred on November 2, 2014. The restart of the direct
reduced iron (DRI) facility has progressed as planned. The facility
is once again producing DRI at the world class level of quality we
expect and is regularly operating at 85% of capacity.
As expected, overall operating performance at the steel mills
segment for the first quarter of 2015 decreased significantly
compared to the fourth quarter of 2014. This lower performance is
primarily due to lower selling prices and margins resulting from
the exceptionally high level of steel imports flooding the domestic
market. It is estimated that imports accounted for 33% of the
finished steel market in the first quarter of 2015. Import levels
in February and March were lower than the peak in January, but
remain at the exceptionally high levels experienced during most of
2014. We anticipate selling prices to remain under pressure as the
flood of imports continues in the second quarter of 2015.
Global overcapacity built by foreign, state-owned enterprises
continues to be a significant risk factor to our business.
Automotive markets remain strong and we continue to see
improving demand in nonresidential construction markets. Conditions
remain challenging in energy markets, in which the collapse in oil
prices and continued high levels of imported oil country tubular
goods products has caused an inventory glut in the pipe and tube
sector. We cannot determine when these conditions will improve, but
once energy market steel inventories are rebalanced we expect
overall steel demand to meet or exceed levels seen in 2014.
The overall operating performance of the downstream products
segment for the first quarter of 2015 decreased from the fourth
quarter of 2014 due to typical seasonality experienced in the first
quarter; however, the results of the downstream products segment in
the first quarter of 2015 increased over the first quarter of 2014
due to both lower input costs and improved volumes. The operating
performance of the raw materials segment for the first quarter of
2015 decreased from the fourth quarter of 2014 due to a larger
operating loss of approximately $44 million ($0.09 per diluted share) at Nucor Steel
Louisiana and decreased performance of our scrap processing
business and natural gas drilling working interests.
Earnings in the second quarter of 2015 are expected to be
somewhat improved from the first quarter of 2015. Although margins
in the steel mills segment are expected to improve, they will
remain under pressure during the second quarter of 2015 as selling
prices have not yet fully stabilized and imports remain at
exceptionally high levels. This pricing pressure is expected to
mitigate the benefits of lower average raw materials costs in the
second quarter. We expect much better performance in the downstream
products segment in the second quarter of 2015. The performance of
the raw materials segment is expected to decrease in the second
quarter of 2015 due to a planned one month outage at our DRI
facility in Trinidad. We
anticipate an operating loss similar to the first quarter of 2015
at Nucor Steel Louisiana, which, due to the extended length of the
time the facility was not operating, will work through higher cost
iron ore inventory that was purchased in 2014. Performance in
the second half of 2015 is expected to further improve on the
strength of continuing improvement in nonresidential construction
and its impact on our downstream products businesses and steel
mills. Additionally, steel pricing is expected to stabilize and
rebound as service center destocking runs its course.
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 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) 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.
You are invited to listen to the live broadcast of Nucor's
conference call in which management will discuss Nucor's first
quarter results on April 23, 2015 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
|
|
|
|
April 4,
2015
|
|
April 5,
2014
|
|
Percentage
Change
|
Steel mills
production
|
|
4,758
|
|
5,194
|
|
-8%
|
Steel mills total
shipments
|
|
4,887
|
|
5,432
|
|
-10%
|
|
|
|
|
|
|
|
|
Sales tons to
outside customers:
|
|
|
|
|
|
|
|
Steel
mills
|
|
4,165
|
|
4,600
|
|
-9%
|
|
Joist
|
|
89
|
|
92
|
|
-3%
|
|
Deck
|
|
82
|
|
87
|
|
-6%
|
|
Cold
finished
|
|
130
|
|
138
|
|
-6%
|
|
Fabricated
concrete
|
|
|
|
|
|
|
|
reinforcing
steel
|
|
262
|
|
239
|
|
10%
|
|
Other
|
|
907
|
|
1,033
|
|
-12%
|
|
|
|
5,635
|
|
6,189
|
|
-9%
|
|
|
|
|
|
|
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited)
|
(In thousands,
except per share data)
|
|
|
|
|
|
Three
Months (13 Weeks) Ended
|
|
|
|
|
|
April 4,
2015
|
|
April 5,
2014
|
|
|
|
|
Net
sales
|
$ 4,399,440
|
|
$
5,108,444
|
|
|
|
|
Costs, expenses
and other:
|
|
|
|
Cost of
products sold
|
4,111,158
|
|
4,731,242
|
Marketing,
administrative and other expenses
|
124,561
|
|
133,434
|
Equity in
losses (earnings) of unconsolidated affiliates
|
259
|
|
(4,474)
|
Interest
expense, net
|
44,417
|
|
40,741
|
|
4,280,395
|
|
4,900,943
|
Earnings before
income taxes and
|
|
|
|
noncontrolling
interests
|
119,045
|
|
207,501
|
Provision for
income taxes
|
34,753
|
|
77,805
|
Net
earnings
|
84,292
|
|
129,696
|
Earnings
attributable to
|
|
|
|
noncontrolling
interests
|
16,492
|
|
18,665
|
Net earnings
attributable to
|
|
|
|
Nucor
stockholders
|
$
67,800
|
|
$
111,031
|
|
|
|
|
Net earnings per
share:
|
|
|
|
Basic
|
$0.21
|
|
$0.35
|
Diluted
|
$0.21
|
|
$0.35
|
|
|
|
|
Average shares
outstanding:
|
|
|
|
Basic
|
320,315
|
|
319,505
|
Diluted
|
320,483
|
|
319,768
|
|
|
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS (Unaudited)
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
April 4,
2015
|
|
Dec. 31,
2014
|
ASSETS
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
Cash and
cash equivalents
|
|
$
1,165,864
|
|
$ 1,024,144
|
|
Short-term
investments
|
|
100,000
|
|
100,000
|
|
Accounts
receivable, net
|
|
1,711,101
|
|
2,068,298
|
|
Inventories,
net
|
|
2,405,916
|
|
2,745,032
|
|
Other
current assets
|
|
480,108
|
|
504,414
|
|
|
|
|
|
|
|
|
|
|
Total
current assets
|
|
5,862,989
|
|
6,441,888
|
|
|
|
|
|
|
|
|
Property,
plant and equipment, net
|
|
5,184,235
|
|
5,287,639
|
|
|
|
|
|
|
|
|
Goodwill
|
|
|
2,043,315
|
|
2,068,664
|
|
|
|
|
|
|
|
|
Other
intangible assets, net
|
|
834,805
|
|
862,093
|
|
|
|
|
|
|
|
|
Other
assets
|
|
930,094
|
|
955,643
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$ 14,855,438
|
|
$ 15,615,927
|
|
|
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
Short-term
debt
|
|
$
26,891
|
|
$
207,476
|
|
Long-term
debt due within one year
|
|
16,300
|
|
16,335
|
|
Accounts
payable
|
|
746,184
|
|
993,872
|
|
Salaries,
wages and related accruals
|
|
225,600
|
|
352,488
|
|
Accrued
expenses and other current liabilities
|
|
509,831
|
|
527,605
|
|
|
|
|
|
|
|
|
|
|
Total
current liabilities
|
|
1,524,806
|
|
2,097,776
|
|
|
|
|
|
|
|
|
Long-term
debt due after one year
|
|
4,360,600
|
|
4,360,600
|
|
|
|
|
|
|
|
|
Deferred
credits and other liabilities
|
|
1,064,361
|
|
1,082,433
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities
|
|
6,949,767
|
|
7,540,809
|
|
|
|
|
|
|
|
|
EQUITY
|
|
|
|
|
|
Nucor
stockholders' equity:
|
|
|
|
|
|
Common
stock
|
|
151,242
|
|
151,237
|
|
Additional
paid-in capital
|
|
1,890,886
|
|
1,883,356
|
|
Retained
earnings
|
|
7,326,244
|
|
7,378,214
|
|
Accumulated
other comprehensive loss,
|
|
|
|
|
|
|
net of
income taxes
|
|
(264,503)
|
|
(145,708)
|
|
Treasury
stock
|
|
(1,492,357)
|
|
(1,494,629)
|
|
|
Total Nucor
stockholders' equity
|
|
7,611,512
|
|
7,772,470
|
|
|
|
|
|
|
|
|
Noncontrolling
interests
|
|
294,159
|
|
302,648
|
|
|
|
|
|
|
|
|
|
|
Total
equity
|
|
7,905,671
|
|
8,075,118
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities and equity
|
|
$ 14,855,438
|
|
$ 15,615,927
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months (13
Weeks) Ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
April 4,
2015
|
|
April 5,
2014
|
|
|
|
|
|
|
|
|
|
Operating
activities:
|
|
|
|
|
|
|
Net
earnings
|
|
|
$
84,292
|
|
$
129,696
|
|
Adjustments:
|
|
|
|
|
|
|
|
Depreciation
|
|
|
157,934
|
|
161,480
|
|
|
Amortization
|
|
|
18,655
|
|
18,432
|
|
|
Stock-based
compensation
|
|
6,453
|
|
6,088
|
|
|
Deferred income
taxes
|
|
(10,173)
|
|
8,312
|
|
|
Equity in losses
(earnings) of unconsolidated affiliates
|
259
|
|
(4,474)
|
|
|
Loss on
assets
|
|
|
-
|
|
9,046
|
|
|
Changes in assets
and liabilities (exclusive of acquisitions and
dispositions):
|
|
|
|
|
|
|
Accounts
receivable
|
|
343,497
|
|
(97,183)
|
|
|
|
Inventories
|
|
|
330,842
|
|
(123,145)
|
|
|
|
Accounts
payable
|
|
(237,847)
|
|
7,489
|
|
|
|
Federal income
taxes
|
|
39,397
|
|
56,526
|
|
|
|
Salaries, wages
and related accruals
|
(122,226)
|
|
(59,147)
|
|
|
|
Other operating
activities
|
|
(47,389)
|
|
36,094
|
|
|
|
|
|
|
|
|
|
Cash provided by
operating activities
|
|
563,694
|
|
149,214
|
|
|
|
|
|
|
|
|
|
Investing
activities:
|
|
|
|
|
|
|
Capital
expenditures
|
|
|
(77,523)
|
|
(258,058)
|
|
Investment in and
advances to affiliates
|
(20,776)
|
|
(7,105)
|
|
Repayment of
advances to affiliates
|
|
-
|
|
3,000
|
|
Disposition of
plant and equipment
|
|
2,604
|
|
4,540
|
|
Acquisitions (net
of cash acquired)
|
|
-
|
|
(1,408)
|
|
Purchases of
investments
|
|
(100,000)
|
|
(100,000)
|
|
Proceeds from the
sale of investments
|
|
100,000
|
|
27,529
|
|
Other investing
activities
|
|
1,870
|
|
-
|
|
|
|
|
|
|
|
|
|
Cash used in
investing activities
|
|
(93,825)
|
|
(331,502)
|
|
|
|
|
|
|
|
|
|
Financing
activities:
|
|
|
|
|
|
|
Net change in
short-term debt
|
|
(180,239)
|
|
(2,130)
|
|
Issuance of common
stock
|
|
423
|
|
-
|
|
Excess tax
benefits from stock-based compensation
|
200
|
|
300
|
|
Distributions to
noncontrolling interests
|
(24,980)
|
|
(24,794)
|
|
Cash
dividends
|
|
|
(119,712)
|
|
(118,680)
|
|
Other financing
activities
|
|
(537)
|
|
(601)
|
|
|
|
|
|
|
|
|
|
Cash used in
financing activities
|
|
(324,845)
|
|
(145,905)
|
|
|
|
|
|
|
|
|
|
Effect of exchange
rate changes on cash
|
|
(3,304)
|
|
(2,517)
|
|
|
|
|
|
|
|
|
|
Increase
(decrease) in cash and cash equivalents
|
141,720
|
|
(330,710)
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents - beginning of year
|
1,024,144
|
|
1,483,252
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents - end of three months
|
$
1,165,864
|
|
$
1,152,542
|
|
|
|
|
|
|
|
|
|
Non-cash investing
activity:
|
|
|
|
|
|
|
Change in accrued
plant and equipment purchases
|
$
(7,812)
|
|
$
(60,864)
|
|
|
|
|
|
|
|
|
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/nucor-reports-results-for-first-quarter-of-2015-300070965.html
SOURCE Nucor Corporation