CHARLOTTE, N.C., July 23 /PRNewswire-FirstCall/ -- Nucor Corporation (NYSE: NUE) announced today a consolidated net loss of $133.3 million, or $0.43 per diluted share, for the second quarter of 2009, compared to a net loss of $189.6 million, or $0.60 per diluted share, in the first quarter of 2009, an improvement of 30%. The results compare to net income of $580.8 million, or $1.94 per diluted share, in the second quarter of 2008.
In the first half of 2009, Nucor reported a consolidated net loss of $323.0 million, or $1.03 per diluted share, compared with net earnings of $990.5 million, or $3.36 per diluted share, in the first half of last year.
In the second quarter of 2009, Nucor's consolidated net sales decreased 7% to $2.48 billion compared with $2.65 billion in the first quarter of 2009 and decreased 65% compared with $7.09 billion in the second quarter of 2008. Average sales price per ton decreased 16% from the first quarter of 2009 and decreased 34% from the second quarter of 2008. Total tons shipped to outside customers were 4,116,000 tons in the second quarter of 2009, an increase of 11% over the first quarter of 2009 and a decrease of 47% from the second quarter of 2008.
In the first half of 2009, Nucor's consolidated net sales decreased 57% to $5.13 billion, compared with $12.06 billion in last year's first half. Average sales price per ton decreased 23% while total tons shipped to outside customers decreased 45% from the first half of 2008.
The average scrap and scrap substitute cost per ton used in the second quarter of 2009 was $312, a decrease of 6% compared with $333 in the first quarter of 2009 and a decrease of 32% from $456 in the second quarter of 2008. The average scrap and scrap substitute cost per ton used in the first half of 2009 was $322, a decrease of 19% from $396 in the first half of 2008.
Nucor recorded a credit to value inventories using the last-in, first-out (LIFO) method of accounting of $125.0 million in the second quarter of 2009, compared with a credit of $105.0 million in the first quarter of 2009 and a charge of $214.0 million in the second quarter of 2008. The LIFO credit in the first half of 2009 was $230.0 million, compared with a charge of $283.0 million in the first half of 2008.
Overall steel mill utilization increased slightly from 45% in the first quarter of 2009 to 46% in the second quarter of 2009, and decreased from 95% in last year's second quarter. Utilization rates decreased from 94% in the first half of 2008 to 46% in the first half of 2009. Monthly steel mill utilization rates increased each month during the second quarter, improving from 38% in April to 54% in June. This improvement reversed the first quarter trend in which utilization rates decreased each month.
Total energy costs decreased approximately $4 per ton from the first quarter of 2009 due to decreased energy costs driven by lower natural gas prices combined with the slight increase in overall utilization. Total energy costs increased approximately $5 per ton from the second quarter of 2008 to the second quarter of 2009 and increased $8 per ton from the first half of 2008 to the first half of 2009 as a result of decreased utilization during the period.
As expected and as discussed in our guidance, second quarter results include a substantially greater burden than the first quarter from the accelerated consumption of high-cost pig iron inventories at our sheet mills. This impact was partially offset by the strong focus on overall cost reductions by all members of the Nucor team. We expect the overhang from the high-cost pig iron will continue to impact our results through the third quarter. If we continue to see improvement in order entry and operating rates, our raw material destocking process would be accelerated with a corresponding improvement in earnings.
At The David J. Joseph Company ("DJJ"), total volumes in the second quarter (both scrap processing and brokerage) were approximately 50% of the prior year; however, in both cases, the volumes improved each month of the quarter and show a strong start to the third quarter. In our downstream businesses, conditions continue to be challenging and recovery is expected to lag Nucor's other businesses. All of Nucor's team members continue to capitalize on Nucor's position of strength arising from our balance sheet, low-cost and highly flexible production capabilities, unrivaled product diversification and, most importantly, Nucor's extremely productive and innovative work force.
Our liquidity position remains strong with $2.20 billion in cash and cash equivalents and short-term investments and an untapped $1.3 billion revolving credit facility that matures in November 2012.
In June, Nucor's board of directors declared a cash dividend of $0.35 per share payable on August 11, 2009 to stockholders of record on June 30, 2009. This dividend is Nucor's one-hundred forty-fifth consecutive quarterly cash dividend, a record we expect to continue.
The third quarter outlook suggests that, in spite of the continued strong negative impact of finishing up our high-cost pig iron inventories, we should see further earnings improvement in the quarter; however, the uncertainty in our economy is still very high. Currently we are concerned that the marginal uptick in orders is not representative of an increase in "real" demand but more a result of both inventory adjustments and concern over rising prices. We will again provide quantitative guidance after the midpoint between our quarterly earnings releases.
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 joists and joist girders; steel deck; fabricated concrete reinforcing steel; cold finished steel; steel fasteners; metal building systems; light gauge steel framing; steel grating and expanded metal; and wire and wire mesh. Nucor, through DJJ, also brokers ferrous and nonferrous metals, pig iron and HBI/DRI; supplies ferro-alloys; and processes ferrous and nonferrous scrap. Nucor is the largest recycler in North America.
Certain statements contained in this news release are "forward-looking statements" that involve risks and uncertainties. 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; (4) competitive pressure on sales and pricing, including pressure from imports and substitute materials; and (5) capital investments and their impact on our performance. These and other factors are outlined in Nucor's regulatory filings with the Securities and Exchange Commission, including those in Nucor's December 31, 2008 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.
You are invited to listen to the live broadcast of Nucor's conference call in which management will discuss Nucor's second quarter results on July 23, 2009 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
---------------------------------
Percentage
July 4, 2009 June 28, 2008 Change
------------ ------------- ----------
Steel Mills:
Production 2,964 6,043 -51%
Total shipments 2,999 6,117 -51%
Outside shipments 2,569 5,394 -52%
Steel Products:
Joist production 65 140 -54%
Deck sales 73 139 -47%
Cold finished sales 76 143 -47%
Fabricated concrete
reinforcing steel sales 255 232 10%
Six Months (26 Weeks) Ended
--------------------------------
Percentage
July 4, 2009 June 28, 2008 Change
------------ ------------- ----------
Steel Mills:
Production 5,843 11,874 -51%
Total shipments 5,807 12,068 -52%
Outside shipments 5,002 10,597 -53%
Steel Products:
Joist production 125 272 -54%
Deck sales 148 255 -42%
Cold finished sales 156 279 -44%
Fabricated concrete
reinforcing steel sales 463 411 13%
Unaudited figures are as follows:
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited)
---------------------------------------------------------
(In thousands, except per share data)
Three Months (13 Weeks) Six Months (26 Weeks)
Ended Ended
------------------------- -----------------------
July 4, 2009 June 28, 2008 July 4, 2009 June 28, 2008
------------ ------------- ------------ -------------
NET SALES $2,478,028 $7,090,599 $5,132,347 $12,064,868
---------- ---------- ---------- -----------
Costs, expenses and other:
Cost of products
sold 2,539,904 5,879,655 5,318,228 9,951,247
Marketing,
administrative
and other expenses 106,925 220,172 232,301 389,886
Interest
expense, net 31,957 26,734 64,322 45,079
--------- --------- --------- ----------
2,678,786 6,126,561 5,614,851 10,386,212
--------- --------- --------- ----------
Earnings (loss)
before income taxes
and noncontrolling
interests (200,758) 964,038 (482,504) 1,678,656
Provision for
(benefit from)
income taxes (72,989) 295,348 (164,210) 508,441
------- ------- -------- -------
Net earnings
(loss) (127,769) 668,690 (318,294) 1,170,215
Earnings attributable
to noncontrolling
interests 5,568 87,936 4,688 179,707
--------- -------- --------- --------
Net earnings (loss)
attributable to
Nucor stockholders $(133,337) $580,754 $(322,982) $990,508
========= ======== ========= ========
NET EARNINGS PER SHARE:
Basic ($0.43) $1.94 ($1.03) $3.37
====== ===== ====== =====
Diluted ($0.43) $1.94 ($1.03) $3.36
====== ===== ====== =====
AVERAGE SHARES
OUTSTANDING:
Basic 314,752 298,262 314,532 293,291
Diluted 314,752 298,668 314,532 294,051
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
---------------------------------------------------
(In thousands)
July 4, 2009 December 31, 2008
------------ -----------------
ASSETS
Current assets:
Cash and cash equivalents $2,060,203 $2,355,130
Short-term investments 136,389 -
Accounts receivable, net 960,226 1,228,807
Inventories 1,268,200 2,408,157
Other current assets 502,810 405,392
----------- -----------
Total current assets 4,927,828 6,397,486
Property, plant and equipment,
net 4,117,542 4,131,861
Goodwill 1,776,207 1,732,045
Other intangible assets, net 922,340 946,545
Other assets 667,130 666,506
----------- -----------
Total assets $12,411,047 $13,874,443
=========== ===========
LIABILITIES
Current liabilities:
Short-term debt $5,942 $8,622
Long-term debt due within one
year 5,400 180,400
Accounts payable 413,347 534,161
Federal income taxes payable - 199,044
Salaries, wages and related
accruals 181,006 580,090
Accrued expenses and other
current liabilities 343,492 351,875
---------- ----------
Total current liabilities 949,187 1,854,192
---------- -----------
Long-term debt due after one
year 3,086,200 3,086,200
----------- -----------
Deferred credits and other
liabilities 671,416 677,370
----------- -----------
Total liabilities 4,706,803 5,617,762
----------- -----------
EQUITY
Nucor stockholders' equity:
Common stock 149,810 149,628
Additional paid-in capital 1,655,252 1,629,981
Retained earnings 7,316,054 7,860,629
Accumulated other comprehensive
loss, net of income taxes (151,203) (190,262)
Treasury stock (1,514,695) (1,520,772)
----------- -----------
7,455,218 7,929,204
Noncontrolling interests 249,026 327,477
----------- -----------
Total equity 7,704,244 8,256,681
----------- -----------
Total liabilities and equity $12,411,047 $13,874,443
=========== ===========
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
------------------------------------------------
(In thousands)
Six Months (26 Weeks)
Ended
----------------------
July 4, 2009 June 28, 2008
------------ -------------
Operating activities:
Net earnings
(loss) $(318,294) $1,170,215
Adjustments:
Depreciation 242,475 231,232
Amortization 36,001 32,066
Stock-based
compensation 31,660 31,148
Deferred income
taxes (31,659) (66,881)
Changes in assets
and liabilities
(exclusive
of acquisitions):
Accounts
receivable 278,055 (591,318)
Inventories 1,147,421 (570,570)
Accounts
payable (121,847) 494,549
Federal
income taxes (285,735) 123,517
Salaries,
wages and
related
expenses (392,276) (14,505)
Other 51,323 (11,214)
--------- ----------
Cash provided by
operating
activities 637,124 828,239
--------- ----------
Investing activities:
Capital
expenditures (240,428) (501,669)
Investment in and
advances to
affiliates (57,904) (27,903)
Disposition of
plant and
equipment 8,610 6,551
Acquisitions (net
of cash acquired) (24,714) (1,591,817)
Purchases of
investments (136,389) (209,605)
Proceeds from the
sale of
investments - 392,055
Proceeds from
currency
derivative
contracts - 1,441,862
Settlement of
currency
derivative
contracts - (1,424,292)
--------- ----------
Cash used in
investing
activities (450,825) (1,914,818)
--------- ----------
Financing activities:
Net change in
short-term debt (2,694) (21,429)
Proceeds from the
issuance of long-
term debt - 989,715
Repayment of long-
term debt (175,000) -
Issuance of
common stock 1,518 1,994,565
Bond issuance
costs - (6,937)
Excess tax
benefits from
stock-based
compensation (700) 9,200
Distributions to
noncontrolling
interests (83,223) (153,218)
Cash dividends (221,127) (327,380)
---------- ----------
Cash provided by
(used in) financing
activities (481,226) 2,484,516
---------- ----------
Increase (decrease)
in cash and cash
equivalents (294,927) 1,397,937
Cash and cash
equivalents -
beginning of year 2,355,130 1,393,943
--------- ----------
Cash and cash
equivalents - end
of six months $2,060,203 $2,791,880
========== ==========
SOURCE Nucor Corporation
