UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period

ended ~~June~~September 30, 2023

☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from _______ to _______

Commission File Number 0-21719

Steel Dynamics, Inc.

(Exact name of registrant as specified in its charter)

Indiana		35-1929476
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

7575 West Jefferson Blvd, Fort Wayne, IN		46804
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (260) 969-3500

Not Applicable

(Former name, former address and former fiscal year, if changed since last report.)

Securities registered pursuant to Section 12(b) of the Act.


Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock voting, $0.0025 par value	STLD	NASDAQ Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ⌧ No ◻

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ⌧ No ◻

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ⌧	Accelerated filer ◻	Non-accelerated filer ◻

Smaller reporting company ☐	Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No⌧

As of ~~July 31,~~November 2, 2023, Registrant had ~~165,644,387~~161,816,470 outstanding shares of common stock.

Table of Contents

STEEL DYNAMICS, INC.

Table of Contents


PART I. Financial Information

Item 1.	Financial Statements:	Page

	Consolidated Balance Sheets as of ~~June~~September 30, 2023 (unaudited) and December 31, 2022	1

	Consolidated Statements of Income for the three and ~~six-month~~nine-month periods ended ~~June~~September 30, 2023 and 2022 (unaudited)	2

	Consolidated Statements of Comprehensive Income for the three and ~~six-month~~nine-month periods ended ~~June~~September 30, 2023 and 2022 (unaudited)	3

	Consolidated Statements of Cash Flows for the three and ~~six-month~~nine-month periods ended ~~June~~September 30, 2023 and 2022 (unaudited)	4

	Notes to Consolidated Financial Statements (unaudited)	5

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	16

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	25

Item 4.	Controls and Procedures	25



	PART II. Other Information

Item 1.	Legal Proceedings	26

Item 1A.	Risk Factors	26

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	26

Item 3.	Defaults Upon Senior Securities	26

Item 4.	Mine Safety Disclosures	26

Item 5.	Other Information	27

Item 6.	Exhibits	28

Exhibit Index		29

Signature		30

Table of Contents

STEEL DYNAMICS, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)


	June 30,		December 31,		September 30,		December 31,
	2023		2022		2023		2022
Assets	(unaudited)				(unaudited)
Current assets
Cash and equivalents	$	1,475,356	$	1,628,417	$	1,765,467	$	1,628,417
Short-term investments		611,701		628,215		500,844		628,215
Accounts receivable, net		2,079,949		1,976,282		1,807,313		1,976,282
Accounts receivable-related parties		63,015		79,769		74,736		79,769
Inventories		3,044,009		3,129,964		2,941,634		3,129,964
Other current assets		122,025		195,371		138,605		195,371
Total current assets		7,396,055		7,638,018		7,228,599		7,638,018

Property, plant and equipment, net		5,783,622		5,373,665		6,313,366		5,373,665

Intangible assets, net		274,005		267,507		265,845		267,507
Goodwill		477,471		502,067		477,471		502,067
Other assets		620,244		378,727		643,675		378,727
Total assets	$	14,551,397	$	14,159,984	$	14,928,956	$	14,159,984
Liabilities and Equity
Current liabilities
Accounts payable	$	1,039,149	$	1,007,304	$	1,049,317	$	1,007,304
Accounts payable-related parties		9,435		9,934		10,858		9,934
Income taxes payable		39,177		6,520		30,343		6,520
Accrued payroll and benefits		321,303		610,558		405,556		610,558
Accrued expenses		293,102		340,646		336,242		340,646
Current maturities of long-term debt		56,869		57,334		86,061		57,334
Total current liabilities		1,759,035		2,032,296		1,918,377		2,032,296

Long-term debt		3,010,829		3,013,241		3,009,010		3,013,241
Deferred income taxes		941,491		889,103		961,117		889,103
Other liabilities		175,073		129,539		182,161		129,539
Total liabilities		5,886,428		6,064,179		6,070,665		6,064,179

Commitments and contingencies

Redeemable noncontrolling interests		171,212		181,503		171,212		181,503

Equity
Common stock voting, $0.0025 par value; 900,000,000 shares authorized;
267,772,737 and 267,762,488 shares issued; and 166,383,336 and 172,936,163
shares outstanding, as of June 30, 2023 and December 31, 2022, respectively		650		650
Treasury stock, at cost; 101,389,401 and 94,826,325 shares,
as of June 30, 2023 and December 31, 2022, respectively		(5,179,722)		(4,459,513)
267,772,737 and 267,762,488 shares issued; and 163,489,456 and 172,936,163
shares outstanding, as of September 30, 2023 and December 31, 2022, respectively						650		650
Treasury stock, at cost; 104,283,281 and 94,826,325 shares,
as of September 30, 2023 and December 31, 2022, respectively						(5,510,983)		(4,459,513)
Additional paid-in capital		1,204,134		1,212,566		1,214,894		1,212,566
Retained earnings		12,681,894		11,375,765		13,189,468		11,375,765
Accumulated other comprehensive income		1,027		889
Accumulated other comprehensive income (loss)						(494)		889
Total Steel Dynamics, Inc. equity		8,707,983		8,130,357		8,893,535		8,130,357
Noncontrolling interests		(214,226)		(216,055)		(206,456)		(216,055)
Total equity		8,493,757		7,914,302		8,687,079		7,914,302
Total liabilities and equity	$	14,551,397	$	14,159,984	$	14,928,956	$	14,159,984

See notes to consolidated financial statements.

Table of Contents

STEEL DYNAMICS, INC.

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

(in thousands, except per share data)



	Three-Month Periods Ended				Six-Month Periods Ended				Three-Month Periods Ended				Nine-Month Periods Ended
	June 30,				June 30,				September 30,				September 30,
	2023		2022		2023		2022		2023		2022		2023		2022

Net sales
Unrelated parties	$	4,930,422	$	5,964,503	$	9,675,775	$	11,375,304	$	4,408,861	$	5,438,747	$	14,061,569	$	16,814,051
Related parties		151,208		248,375		299,061		407,476		178,196		212,960		500,324		620,436
Total net sales		5,081,630		6,212,878		9,974,836		11,782,780		4,587,057		5,651,707		14,561,893		17,434,487

Costs of goods sold		3,774,772		4,329,536		7,611,856		8,116,925		3,635,038		4,187,278		11,246,894		12,304,203
Gross profit		1,306,858		1,883,342		2,362,980		3,665,855		952,019		1,464,429		3,314,999		5,130,284

Selling, general and administrative expenses		141,209		118,377		285,518		270,392		145,896		132,627		431,414		403,019
Profit sharing		90,990		139,742		160,565		268,211		64,413		105,122		224,978		373,333
Amortization of intangible assets		10,924		7,160		17,802		14,322		8,160		6,836		25,962		21,158
Operating income		1,063,735		1,618,063		1,899,095		3,112,930		733,550		1,219,844		2,632,645		4,332,774

Interest expense, net of capitalized interest		20,767		25,667		43,274		42,336		18,415		25,347		61,689		67,683
Other (income) expense, net		(31,348)		(4,021)		(66,284)		16,447		(39,464)		(13,975)		(105,748)		2,472
Income before income taxes		1,074,316		1,596,417		1,922,105		3,054,147		754,599		1,208,472		2,676,704		4,262,619

Income tax expense		258,139		381,765		461,595		732,141		174,817		289,997		636,412		1,022,138
Net income		816,177		1,214,652		1,460,510		2,322,006		579,782		918,475		2,040,292		3,240,481

Net income attributable to noncontrolling interests		(4,070)		(5,098)		(11,093)		(8,521)		(2,587)		(4,150)		(13,680)		(12,671)
Net income attributable to Steel Dynamics, Inc.	$	812,107	$	1,209,554	$	1,449,417	$	2,313,485	$	577,195	$	914,325	$	2,026,612	$	3,227,810



Basic earnings per share attributable to Steel
Dynamics, Inc. stockholders	$	4.83	$	6.49	$	8.54	$	12.22	$	3.49	$	5.07	$	12.04	$	17.33

Weighted average common shares outstanding		168,009		186,442		169,803		189,300		165,170		180,264		168,259		186,288

Diluted earnings per share attributable to Steel
Dynamics, Inc. stockholders, including the effect
of assumed conversions when dilutive	$	4.81	$	6.44	$	8.49	$	12.14	$	3.47	$	5.03	$	11.98	$	17.21

Weighted average common shares and share equivalents outstanding		168,865		187,740		170,672		190,491		166,105		181,613		169,150		187,531

Dividends declared per share	$	0.425	$	0.34	$	0.85	$	0.68	$	0.425	$	0.34	$	1.275	$	1.02

See notes to consolidated financial statements.

Table of Contents

STEEL DYNAMICS, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)

(in thousands)



	Three-Month Periods Ended				Six-Month Periods Ended				Three-Month Periods Ended				Nine-Month Periods Ended
	June 30,				June 30,				September 30,				September 30,
	2023		2022		2023		2022		2023		2022		2023		2022

Net income	$	816,177	$	1,214,652	$	1,460,510	$	2,322,006	$	579,782	$	918,475	$	2,040,292	$	3,240,481
Other comprehensive income - net unrealized gain (loss) on cash
flow hedging derivatives, net of income tax expense (benefit) of
($247) and ($4,465) for the three months ended, and $44 and ($908)
for the six months ended June 30, 2023 and 2022, respectively		(773)		(14,295)		138		(2,908)
($485) and $703 for the three months ended, and ($441) and ($205)
for the nine months ended September 30, 2023 and 2022, respectively										(1,521)		2,251		(1,383)		(657)
Comprehensive income		815,404		1,200,357		1,460,648		2,319,098		578,261		920,726		2,038,909		3,239,824

Comprehensive income attributable to noncontrolling interests		(4,070)		(5,098)		(11,093)		(8,521)		(2,587)		(4,150)		(13,680)		(12,671)
Comprehensive income attributable to Steel Dynamics, Inc.	$	811,334	$	1,195,259	$	1,449,555	$	2,310,577	$	575,674	$	916,576	$	2,025,229	$	3,227,153

See notes to consolidated financial statements.

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STEEL DYNAMICS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(in thousands)

Three-Month Periods Ended

Six-Month Periods Ended

June 30,

June 30,

2023

2022

2023

2022

Operating activities:

Net income
$
816,177

$
1,214,652

$
1,460,510

$
2,322,006

Adjustments to reconcile net income to net cash provided by

operating activities:

Depreciation and amortization

110,970

95,701

218,664

183,247
Equity-based compensation

11,678

11,069

27,756

27,588
Deferred income taxes

43,380

(2,636)

52,388

(4)
Other adjustments

1,541

(640)

(8,465)

10,517
Changes in certain assets and liabilities:

Accounts receivable

(16,971)

(297,047)

(87,893)

(744,281)
Inventories

(55,158)

(130,552)

85,954

(116,237)
Other assets

(4,923)

(12,887)

2,919

6,515
Accounts payable

(114,013)

187,521

3,299

111,550
Income taxes receivable/payable

(85,486)

(203,352)

103,761

138,553
Accrued expenses

100,611

140,023

(317,304)

(118,634)
Net cash provided by operating activities

807,806

1,001,852

1,541,589

1,820,820

Investing activities:

Purchases of property, plant and equipment

(358,280)

(164,142)

(584,599)

(323,472)
Purchases of short-term investments

(165,052)

(351,510)

(521,829)

(351,510)
Proceeds from maturities of short-term investments

267,969

-

539,076

-
Investments in unconsolidated affiliates

-

-

-

(222,480)
Other investing activities

(217,905)

4,817

(215,562)

5,227
Net cash used in investing activities

(473,268)

(510,835)

(782,914)

(892,235)

Financing activities:

Issuance of current and long-term debt

327,132

382,868

721,042

702,647
Repayment of current and long-term debt

(321,143)

(414,719)

(726,422)

(763,991)
Dividends paid

(72,323)

(64,344)

(131,121)

(115,043)
Purchases of treasury stock

(380,206)

(517,024)

(734,203)

(906,214)
Other financing activities

(17,579)

(60,241)

(41,028)

(82,768)
Net cash used in financing activities

(464,119)

(673,460)

(911,732)

(1,165,369)

Decrease in cash, cash equivalents, and restricted cash

(129,581)

(182,443)

(153,057)

(236,784)
Cash, cash equivalents, and restricted cash at beginning of period

1,610,443

1,195,028

1,633,919

1,249,369

Cash, cash equivalents, and restricted cash at end of period
$
1,480,862

$
1,012,585

$
1,480,862

$
1,012,585

Supplemental disclosure information:

Cash paid for interest
$
41,781

$
41,114

$
51,377

$
50,282
Cash paid for income taxes, net
$
308,055

$
580,454

$
312,758

$
590,402



	Three-Month Periods Ended				Nine-Month Periods Ended
	September 30,				September 30,
	2023		2022		2023		2022

Operating activities:
Net income	$	579,782	$	918,475	$	2,040,292	$	3,240,481

Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization		107,418		98,714		326,082		281,961
Equity-based compensation		12,044		12,093		39,800		39,681
Deferred income taxes		19,625		3,990		72,013		3,986
Other adjustments		(12,163)		(12,409)		(20,628)		(1,892)
Changes in certain assets and liabilities:
Accounts receivable		260,915		326,731		173,022		(417,550)
Inventories		102,376		270,628		188,330		154,391
Other assets		(13,423)		(15,789)		(10,504)		(9,274)
Accounts payable		(57,532)		(264,313)		(54,233)		(152,763)
Income taxes receivable/payable		(7,105)		8,269		96,656		146,822
Accrued expenses		121,762		149,766		(195,542)		31,132
Net cash provided by operating activities		1,113,699		1,496,155		2,655,288		3,316,975

Investing activities:
Purchases of property, plant and equipment		(558,361)		(241,229)		(1,142,960)		(564,701)
Purchases of short-term investments		(170,887)		(283,188)		(692,716)		(634,698)
Proceeds from maturities of short-term investments		282,592		49,794		821,668		49,794
Business combinations, net of cash acquired		-		(47,638)		-		(47,638)
Investments in unconsolidated affiliates		-		-		-		(222,480)
Other investing activities		(5,891)		4,113		(221,453)		9,340
Net cash used in investing activities		(452,547)		(518,148)		(1,235,461)		(1,410,383)

Financing activities:
Issuance of current and long-term debt		345,563		348,286		1,066,605		1,050,933
Repayment of current and long-term debt		(316,511)		(363,060)		(1,042,933)		(1,127,051)
Dividends paid		(70,713)		(62,088)		(201,834)		(177,131)
Purchases of treasury stock		(331,318)		(481,676)		(1,065,521)		(1,387,890)
Other financing activities		1,953		(6,057)		(39,075)		(88,825)
Net cash used in financing activities		(371,026)		(564,595)		(1,282,758)		(1,729,964)

Increase in cash, cash equivalents, and restricted cash		290,126		413,412		137,069		176,628
Cash, cash equivalents, and restricted cash at beginning of period		1,480,862		1,012,585		1,633,919		1,249,369

Cash, cash equivalents, and restricted cash at end of period	$	1,770,988	$	1,425,997	$	1,770,988	$	1,425,997


Supplemental disclosure information:
Cash paid for interest	$	9,848	$	9,214	$	61,225	$	59,496
Cash paid for income taxes, net	$	160,178	$	276,948	$	472,936	$	867,350

See notes to consolidated financial statements.

Table of Contents

STEEL DYNAMICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Note 1. Description of the Business and Significant Accounting Policies

Description of the Business

Steel Dynamics, Inc. (SDI), together with its subsidiaries (the company), is one of the largest and most diversified domestic steel producers and metals recycler, combined with a meaningful steel fabrication manufacturing platform. The company has three reporting segments: steel operations, metals recycling operations, and steel fabrication operations.

Steel Operations Segment. Steel operations include the company’s electric arc furnace (EAF) steel mills, including Butler Flat Roll Division, Columbus Flat Roll Division, Southwest-Sinton Flat Roll Division, Structural and Rail Division, Engineered Bar Products Division, Roanoke Bar Division, Steel of West Virginia, steel coating and processing operations at The Techs, Heartland Flat Roll Division, United Steel Supply (USS) ~~– 90% equity interest as of April 1, 2023,~~, Vulcan Threaded Products, Inc., and SDI Biocarbon Solutions, LLC, a joint venture to construct and operate a biocarbon production facility. Steel operations accounted for ~~67%~~68% and 66% of the company’s consolidated net sales during the three-month periods ended ~~June~~September 30, 2023 and 2022, respectively, and 66% and 67% of the ~~six-month period ended June 30, 2022 and 65%~~company’s consolidated net sales during the ~~six-month period~~nine-month periods ended ~~June~~September 30, ~~2023.~~2023 and 2022, respectively.

Metals Recycling Operations Segment. Metals recycling operations include the company’s OmniSource ferrous and nonferrous processing, transportation, marketing, brokerage, and scrap management services primarily throughout the United States and in Central and Northern Mexico. Metals recycling operations accounted for ~~12%~~11% and 8% of the company’s consolidated net sales during the ~~three and six-month~~three-month periods ended ~~June~~September 30, 2023 and 2022, respectively, and 12% and 10% of the company’s consolidated net sales during the ~~three and six-month~~nine-month periods ended ~~June~~September 30, ~~2022.~~2023 and 2022, respectively.

Steel Fabrication Operations Segment. Steel fabrication operations include the company’s New Millennium Building Systems’ joist and deck plants located throughout the United States, and in Northern Mexico. Revenues from these plants are generated from the fabrication of trusses, girders, steel joists and steel deck used within the non-residential construction industry. Steel fabrication operations accounted for ~~15%~~14% and ~~16%~~20% of the company’s consolidated net sales during the ~~three and six-month~~three-month periods ended ~~June~~September 30, 2023 and 2022, respectively, and ~~17%~~15% and 18% of the company’s consolidated net sales during the ~~three and six-month~~nine-month periods ended ~~June~~September 30, ~~2022.~~2023 and 2022, respectively.

Other. Other operations consist of subsidiary operations that are below the company’s quantitative thresholds required for reportable segments and primarily consist of joint ventures, including the company’s ~~newly announced~~ aluminum flat roll mill and satellite slab centers and the company’s idled Minnesota ironmaking operations. Also included in “Other” are certain unallocated corporate accounts, such as the company’s senior unsecured credit facility, senior notes, certain other investments and certain profit sharing expenses.

Significant Accounting Policies

Principles of Consolidation

The consolidated financial statements include the accounts of ~~SDI,~~Steel Dynamics, Inc., together with its wholly- and majority-owned or controlled subsidiaries, after elimination of intercompany accounts and transactions. Noncontrolling and redeemable noncontrolling interests represent the noncontrolling owners’ proportionate share in the equity, income, or losses of the company’s majority-owned or controlled consolidated subsidiaries. Redeemable noncontrolling interests related to USS (owned 90% by SDI ateffective April 1, 2023 and 87.5% at December 31, 2022) are $60.0 million at ~~June~~September 30, 2023, and $70.3 million at December 31, 2022. On April 1, 2023, a noncontrolling member of USS exercised its option to require SDI to purchase its 2.5% equity interest, increasing SDI’s ownership to 90%. The remaining noncontrolling members’ option to require SDI to purchase the remaining 10% equity interest of USS has been extended to on or after February 28, 2025. Redeemable noncontrolling interests related to Mesabi Nugget (owned 85.5% by SDI) are $111.2 million at ~~June~~September 30, 2023, and December 31, 2022.

Table of Contents

STEEL DYNAMICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Note 1. Description of the Business and Significant Accounting Policies (Continued)

Use of Estimates

These consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States, and accordingly, include amounts that require management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and in the notes thereto. Significant items subject to such estimates and assumptions include the carrying value of property, plant and equipment, intangible assets, and goodwill; valuation allowances for trade receivables, inventories and deferred income tax assets; unrecognized tax benefits; potential environmental liabilities; and litigation claims and settlements. Actual results may differ from these estimates and assumptions.

In the opinion of management, these financial statements reflect all normal recurring adjustments necessary for a fair presentation of the interim period results. These consolidated financial statements and notes should be read in conjunction with the audited financial statements and notes thereto included in the company’s Annual Report on Form 10-K for the year ended December 31, 2022.

Cash and Equivalents, and Restricted Cash

Cash and equivalents include all highly liquid investments with a maturity of three months or less at the date of acquisition. Restricted cash is primarily funds held in escrow as required by various insurance and government organizations. The balance of cash, cash equivalents and restricted cash in the consolidated statements of cash flows includes restricted cash of $5.5 million for all periods presented, which are recorded in Other Assets (noncurrent) in the company’s consolidated balance sheets.

Senior Credit Facility

On July 19, 2023, the company entered into a new unsecured credit agreement comprised of a senior unsecured credit facility (Facility), which provides a $1.2 billion Revolver, maturing July 19, 2028. The new Credit Agreement replaces the December 3, 2019 Credit Agreement. Subject to certain conditions, the company has the ability to increase the Revolver size by $500.0 million. The Facility is available to fund working capital, capital expenditures, and other general corporate purposes. The Facility contains financial covenants and other covenants pertaining to the company’s ability to incur indebtedness and permit liens on certain assets. The company’s ability to borrow funds within the terms of the unsecured Revolver is dependent upon its continued compliance with financial and other covenants.

The Facility pricing grid is adjusted quarterly and is based on either the company’s leverage of net debt (as defined in the Facility) to last-twelve-months (LTM) consolidated Adjusted EBITDA as defined in the Facility (earnings before interest, taxes, depreciation, amortization, and certain other non-cash items, as defined in the Facility), or the company’s credit ratings. The minimum pricing is adjusted Secured Overnight Financing Rate (SOFR) plus 1.000% and the maximum pricing is adjusted SOFR plus 1.75%. In addition, the company is subject to an unused commitment fee of between 0.11% and 0.275% (based on either the company’s leverage of net debt to LTM consolidated adjusted EBITDA, or the company’s credit ratings) which is applied to the unused portion of the Revolver.

Other Obligations

One of the company’s consolidated joint venture subsidiaries has a secured credit agreement with a maturity inJune 2028, comprised of a $125.0 million revolving credit facility, which is subject to a borrowing base determined from eligible accounts receivable and inventory.

Table of Contents

STEEL DYNAMICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Note 1. Description of the Business and Significant Accounting Policies (Continued)

~~Other Obligations~~

~~One of the company’s consolidated joint venture subsidiaries amended and restated its secured credit agreement and extended the maturity toJune 2028, comprised of a $125.0 million revolving credit facility, which is subject to a borrowing base determined from eligible accounts receivable and inventory.~~

Goodwill

The company’s goodwill consisted of the following at ~~June~~September 30, 2023, and December 31, 2022 (in thousands):



	June 30,		December 31,			September 30,		December 31,
	2023		2022			2023		2022

Steel Operations Segment	$	272,133	$	272,133	Steel Operations Segment	$	272,133	$	272,133
Metals Recycling Operations Segment		203,413		228,009	Metals Recycling Operations Segment		203,413		228,009
Steel Fabrication Operations Segment		1,925		1,925	Steel Fabrication Operations Segment		1,925		1,925
	$	477,471	$	502,067		$	477,471	$	502,067

Credit Losses

The company is exposed to credit risk in the event of nonpayment of accounts receivable by customers. The company mitigates its exposure to credit risk, which it generally extends on an unsecured basis, by performing ongoing credit evaluations and taking further action if necessary, such as requiring letters of credit or other security interests to support the customer receivable. The allowance for credit losses for accounts receivable is based on the company’s reasonable estimate of known credit risks and historical experience, adjusted for current and anticipated economic and other pertinent factors affecting the company’s customers, that may differ from historical experience. Customer accounts receivable are written off when all collection efforts have been exhausted and the amounts are deemed uncollectible.

At ~~June~~September 30, 2023, the company reported ~~$2,143~~$1,882 million of accounts receivable, net of allowances for credit losses of ~~$7.9~~$8.1 million. Changes in the allowance were not material for each of the three and ~~six-month~~nine-month periods ended ~~June~~September 30, 2023 and 2022.

Note 2. Earnings Per Share

Basic earnings per share is based on the weighted average shares of common stock outstanding during the period. Diluted earnings per share assumes the weighted average dilutive effect of common share equivalents outstanding during the period applied to the company’s basic earnings per share. Common share equivalents represent potentially dilutive restricted stock units, deferred stock units, restricted stock, and performance awards, and are excluded from the computation in periods in which they have an anti-dilutive effect. There were no anti-dilutive common share equivalents as of or for the three and ~~six-month~~nine-month periods ended ~~June~~September 30, 2023 and 2022.

Table of Contents

STEEL DYNAMICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Note 2. Earnings Per Share (Continued)



	Three-Month Periods Ended June 30,												Three-Month Periods Ended September 30,
	2023						2022						2023						2022
			Weighted						Weighted						Weighted						Weighted
			Average						Average						Average						Average
	Net Income		Shares		Per Share		Net Income		Shares		Per Share		Net Income		Shares		Per Share		Net Income		Shares		Per Share
	(Numerator)		(Denominator)		Amount		(Numerator)		(Denominator)		Amount		(Numerator)		(Denominator)		Amount		(Numerator)		(Denominator)		Amount
Basic earnings per share	$	812,107		168,009	$	4.83	$	1,209,554		186,442	$	6.49	$	577,195		165,170	$	3.49	$	914,325		180,264	$	5.07
Dilutive common share equivalents		-		856				-		1,298				-		935				-		1,349
Diluted earnings per share	$	812,107		168,865	$	4.81	$	1,209,554		187,740	$	6.44	$	577,195		166,105	$	3.47	$	914,325		181,613	$	5.03

N


	Six-Month Periods Ended June 30,												Nine-Month Periods Ended September 30,
	2023						2022						2023						2022
			Weighted						Weighted						Weighted						Weighted
			Average						Average						Average						Average
	Net Income		Shares		Per Share		Net Income		Shares		Per Share		Net Income		Shares		Per Share		Net Income		Shares		Per Share
	(Numerator)		(Denominator)		Amount		(Numerator)		(Denominator)		Amount		(Numerator)		(Denominator)		Amount		(Numerator)		(Denominator)		Amount
Basic earnings per share	$	1,449,417		169,803	$	8.54	$	2,313,485		189,300	$	12.22	$	2,026,612		168,259	$	12.04	$	3,227,810		186,288	$	17.33
Dilutive common share equivalents		-		869				-		1,191				-		891				-		1,243
Diluted earnings per share	$	1,449,417		170,672	$	8.49	$	2,313,485		190,491	$	12.14	$	2,026,612		169,150	$	11.98	$	3,227,810		187,531	$	17.21

Note 3. Inventories

Inventories are stated at lower of cost or net realizable value. Cost is determined using a weighted average cost method for raw materials (including scrap and purchased steel substrate) and supplies, and on a first-in, first-out basis for other inventory. Inventory consisted of the following (in thousands):


	June 30,		December 31,		September 30,		December 31,
	2023		2022		2023		2022
Raw materials	$	1,416,669	$	1,608,344	$	1,288,497	$	1,608,344
Supplies		678,823		629,074		692,738		629,074
Work in progress		305,691		256,071		341,036		256,071
Finished goods		642,826		636,475		619,363		636,475
Total inventories	$	3,044,009	$	3,129,964	$	2,941,634	$	3,129,964

Note 4. Changes in Equity

The following tables provide a reconciliation of the beginning and ending carrying amounts of total equity, equity attributable to stockholders of Steel Dynamics, Inc., and equity and redeemable amounts attributable to noncontrolling interests ~~(in thousands)~~ for each of the three and ~~six-month~~nine-month periods ended ~~June~~September 30, 2023 and ~~2022:~~2022 (in thousands).

Table of Contents

STEEL DYNAMICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Note 4. Changes in Equity (Continued)



	Stockholders of Steel Dynamics, Inc.																Stockholders of Steel Dynamics, Inc.
									Accumulated																Accumulated
					Additional				Other						Redeemable						Additional				Other						Redeemable
	Common		Treasury		Paid-In		Retained		Comprehensive		Noncontrolling		Total		Noncontrolling		Common		Treasury		Paid-In		Retained		Comprehensive		Noncontrolling		Total		Noncontrolling
	Stock		Stock		Capital		Earnings		Income		Interests		Equity		Interests		Stock		Stock		Capital		Earnings		Income (Loss)		Interests		Equity		Interests
Balances at December 31, 2022	$	650	$	(4,459,513)	$	1,212,566	$	11,375,765	$	889	$	(216,055)	$	7,914,302	$	181,503	$	650	$	(4,459,513)	$	1,212,566	$	11,375,765	$	889	$	(216,055)	$	7,914,302	$	181,503
Dividends declared		-		-		-		(72,316)		-		-		(72,316)		-		-		-		-		(72,316)		-		-		(72,316)		-
Noncontrolling investors, net		-		-		-		-		-		(7,387)		(7,387)		4,702		-		-		-		-		-		(7,387)		(7,387)		4,702
Share repurchases		-		(353,997)		-		-		-		-		(353,997)		-		-		(353,997)		-		-		-		-		(353,997)		-
Equity-based compensation		-		12,997		(18,487)		(138)		-		-		(5,628)		-		-		12,997		(18,487)		(138)		-		-		(5,628)		-
Net income		-		-		-		637,310		-		7,023		644,333		-		-		-		-		637,310		-		7,023		644,333		-
Other comprehensive income, net of tax		-		-		-		-		911		-		911		-		-		-		-		-		911		-		911		-
Balances at March 31, 2023		650		(4,800,513)		1,194,079		11,940,621		1,800		(216,419)		8,120,218		186,205		650		(4,800,513)		1,194,079		11,940,621		1,800		(216,419)		8,120,218		186,205
Dividends declared		-		-		-		(70,694)		-		-		(70,694)		-		-		-		-		(70,694)		-		-		(70,694)		-
Noncontrolling investors, net		-		-		-		-		-		(1,877)		(1,877)		(14,993)		-		-		-		-		-		(1,877)		(1,877)		(14,993)
Share repurchases		-		(380,206)		-		-		-		-		(380,206)		-		-		(380,206)		-		-		-		-		(380,206)		-
Equity-based compensation		-		997		10,055		(140)		-		-		10,912		-		-		997		10,055		(140)		-		-		10,912		-
Net income		-		-		-		812,107		-		4,070		816,177		-		-		-		-		812,107		-		4,070		816,177		-
Other comprehensive loss, net of tax		-		-		-		-		(773)		-		(773)		-		-		-		-		-		(773)		-		(773)		-
Balances at June 30, 2023	$	650	$	(5,179,722)	$	1,204,134	$	12,681,894	$	1,027	$	(214,226)	$	8,493,757	$	171,212		650		(5,179,722)		1,204,134		12,681,894		1,027		(214,226)		8,493,757		171,212
Dividends declared																		-		-		-		(69,483)		-		-		(69,483)		-
Noncontrolling investors, net																		-		-		-		-		-		5,183		5,183		-
Share repurchases																		-		(331,318)		-		-		-		-		(331,318)		-
Equity-based compensation																		-		57		10,760		(138)		-		-		10,679		-
Net income																		-		-		-		577,195		-		2,587		579,782		-
Other comprehensive loss, net of tax																		-		-		-		-		(1,521)		-		(1,521)		-
Balances at September 30, 2023																	$	650	$	(5,510,983)	$	1,214,894	$	13,189,468	$	(494)	$	(206,456)	$	8,687,079	$	171,212



	Stockholders of Steel Dynamics, Inc.																Stockholders of Steel Dynamics, Inc.
									Accumulated																Accumulated
					Additional				Other						Redeemable						Additional				Other						Redeemable
	Common		Treasury		Paid-In		Retained		Comprehensive		Noncontrolling		Total		Noncontrolling		Common		Treasury		Paid-In		Retained		Comprehensive		Noncontrolling		Total		Noncontrolling
	Stock		Stock		Capital		Earnings		Income (Loss)		Interests		Equity		Interests		Stock		Stock		Capital		Earnings		Income (Loss)		Interests		Equity		Interests
Balances at December 31, 2021	$	649	$	(2,674,267)	$	1,218,933	$	7,761,417	$	(2,091)	$	(195,884)	$	6,108,757	$	211,414	$	649	$	(2,674,267)	$	1,218,933	$	7,761,417	$	(2,091)	$	(195,884)	$	6,108,757	$	211,414
Dividends declared		-		-		-		(64,344)		-		-		(64,344)		-		-		-		-		(64,344)		-		-		(64,344)		-
Noncontrolling investors, net		-		-		-		-		-		(21,633)		(21,633)		16,500		-		-		-		-		-		(21,633)		(21,633)		16,500
Share repurchases		-		(389,190)		-		-		-		-		(389,190)		-		-		(389,190)		-		-		-		-		(389,190)		-
Equity-based compensation		-		12,960		(14,910)		(121)		-		-		(2,071)		-		-		12,960		(14,910)		(121)		-		-		(2,071)		-
Net income		-		-		-		1,103,931		-		3,423		1,107,354		-		-		-		-		1,103,931		-		3,423		1,107,354		-
Other comprehensive income, net of tax		-		-		-		-		11,387		-		11,387		-		-		-		-		-		11,387		-		11,387		-
Balances at March 31, 2022	$	649	$	(3,050,497)	$	1,204,023	$	8,800,883	$	9,296	$	(214,094)	$	6,750,260	$	227,914	$	649	$	(3,050,497)	$	1,204,023	$	8,800,883	$	9,296	$	(214,094)	$	6,750,260	$	227,914
Dividends declared		-		-		-		(62,088)		-		-		(62,088)		-		-		-		-		(62,088)		-		-		(62,088)		-
Noncontrolling investors, net		-		-		630		(2,495)		-		1,235		(630)		(59,611)		-		-		630		(2,495)		-		1,235		(630)		(59,611)
Share repurchases		-		(517,024)		-		-		-		-		(517,024)		-		-		(517,024)		-		-		-		-		(517,024)		-
Equity-based compensation		-		1,028		8,828		(144)		-		-		9,712		-		-		1,028		8,828		(144)		-		-		9,712		-
Net income		-		-		-		1,209,554		-		5,098		1,214,652		-		-		-		-		1,209,554		-		5,098		1,214,652		-
Other comprehensive loss, net of tax		-		-		-		-		(14,295)		-		(14,295)		-		-		-		-		-		(14,295)		-		(14,295)		-
Balances at June 30, 2022	$	649	$	(3,566,493)	$	1,213,481	$	9,945,710	$	(4,999)	$	(207,761)	$	7,380,587	$	168,303	$	649	$	(3,566,493)	$	1,213,481	$	9,945,710	$	(4,999)	$	(207,761)	$	7,380,587	$	168,303
Dividends declared																		-		-		-		(60,031)		-		-		(60,031)		-
Noncontrolling investors, net																		-		-		-		-		-		(4,743)		(4,743)		4,100
Share repurchases																		-		(481,676)		-		-		-		-		(481,676)		-
Equity-based compensation																		-		1,614		6,466		(141)		-		-		7,939		-
Net income																		-		-		-		914,325		-		4,150		918,475		-
Other comprehensive income, net of tax																		-		-		-		-		2,251		-		2,251		-
Balances at September 30, 2022																	$	649	$	(4,046,555)	$	1,219,947	$	10,799,863	$	(2,748)	$	(208,354)	$	7,762,802	$	172,403

Table of Contents

STEEL DYNAMICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Note 5. Derivative Financial Instruments

The company is exposed to certain risks relating to its ongoing business operations. The company utilizes derivative instruments to mitigate commodity margin risk, and occasionally to mitigate foreign currency exchange rate risk, and have in the past to mitigate interest rate fluctuation risk. The company routinely enters into forward exchange traded futures and option contracts to manage the price risk associated with nonferrous metals inventory as well as purchases and sales of nonferrous metals (primarily aluminum and copper) and ferrous metals. The company offsets fair value amounts recognized for derivative instruments executed with the same counterparty under master netting agreements.

~~Table of Contents~~

~~STEEL DYNAMICS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)~~

~~Note 5. Derivative Financial Instruments (Continued)~~

Commodity Futures Contracts. If the company is “long” on futures contracts, it means the company has more futures contracts purchased than futures contracts sold for the underlying commodity. If the company is “short” on a futures contract, it means the company has more futures contracts sold than futures contracts purchased for the underlying commodity. The following summarizes the company’s significant futures contract commitments as of ~~June~~September 30, 2023:



Commodity Futures	Long/Short	Metric Tons
Aluminum	Long	~~8,150~~5,100
Aluminum	Short	~~12,500~~10,425
Copper	Long	~~55,905~~20,933
Copper	Short	~~74,877~~40,665

The following summarizes the location and amounts of the fair values reported on the company’s consolidated balance sheets as of ~~June~~September 30, 2023, and December 31, 2022, and gains and losses related to derivatives included in the company’s statement of income for each of the three and ~~six-month~~nine-month periods ended ~~June~~September 30, 2023 and 2022 (in thousands):

Asset Derivatives

Liability Derivatives

Balance sheet

Fair Value

Fair Value

location

June 30, 2023

December 31, 2022

June 30, 2023

December 31, 2022
Derivative instruments designated as hedges

Commodity futures
Other current assets

$
4,485

$
2,169

$
1,979

$
2,119

Derivative instruments not designated as hedges

Commodity futures
Other current assets

26,915

2,102

14,398

5,269
Total derivative instruments

$
31,400

$
4,271

$
16,377

$
7,388

The fair value of the above derivative instruments along with required margin deposit amounts with the same counterparty under master netting arrangements totaled $18.2 million at June 30, 2023, and $23.5 million at December 31, 2022, and are reflected in other current assets in the consolidated balance sheets.

Amount of gain

Amount of loss

recognized in income

Location of loss
recognized in income

Location of gain
on derivatives for the

recognized
on derivatives for the

recognized
three-month periods

Hedged items in

in income on
three-month periods

in income on
ended June 30,

fair value hedge

related hedged
ended June 30,

derivatives
2023

2022

relationships

items
2023

2022
Derivatives in fair value hedging relationships

Commodity futures

Costs of goods sold
$
2,430

$
11,956

Firm commitments

Costs of goods sold
$
(264)

$
(4,343)

Inventory

Costs of goods sold

(368)

(5,996)

$
(632)

$
(10,339)
Derivatives not designated as hedging instruments

Commodity futures

Costs of goods sold
$
18,639

$
27,391



		Asset Derivatives				Liability Derivatives
	Balance sheet	Fair Value				Fair Value
	location	September 30, 2023		December 31, 2022		September 30, 2023		December 31, 2022
Derivative instruments designated as hedges
Commodity futures	Other current assets	$	1,591	$	2,169	$	1,775	$	2,119

Derivative instruments not designated as hedges
Commodity futures	Other current assets		5,075		2,102		4,082		5,269
Total derivative instruments		$	6,666	$	4,271	$	5,857	$	7,388

Table of Contents

STEEL DYNAMICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Note 5. Derivative Financial Instruments (Continued)

Amount of gain

Amount of gain (loss)

recognized in income

Location of gain
recognized in income

Location of gain
on derivatives for the

(loss) recognized
on derivatives for the

recognized
six-month periods

Hedged items in

in income on
six-month periods

in income on
ended June 30,

fair value hedge

related hedged
ended June 30,

derivatives
2023

2022

relationships

items
2023

2022
Derivatives in fair value hedging relationships

Commodity futures

Costs of goods sold
$
2,275

$
13,281

Firm commitments

Costs of goods sold
$
113

$
(5,535)

Inventory

Costs of goods sold

(129)

(6,380)

$
(16)

$
(11,915)
Derivatives not designated as hedging instruments

Commodity futures

Costs of goods sold
$
7,249

$
16,170

The fair value of the above derivative instruments along with required margin deposit amounts with the same counterparty under master netting arrangements totaled $20.9 million at September 30, 2023, and $23.5 million at December 31, 2022, and are reflected in other current assets in the consolidated balance sheets.

Amount of gain (loss)

recognized in income

Location of gain (loss)

recognized in income

Location of gain (loss)

on derivatives for the

recognized

on derivatives for the

recognized

three-month periods

Hedged items in

in income on

three-month periods

in income on

ended September 30,

fair value hedge

related hedged

ended September 30,

derivatives

2023

2022

relationships

items

2023

2022

Derivatives in fair value hedging relationships

Commodity futures

Costs of goods sold

(684)

(7,663)

Firm commitments

Costs of goods sold

(536)

3,389

Inventory

Costs of goods sold

(88)

4,941

(624)

8,330

Derivatives not designated as hedging instruments

Commodity futures

Costs of goods sold

2,179

18,164

Amount of gain (loss)

recognized in income

Location of gain

recognized in income

Location of gain (loss)

on derivatives for the

(loss) recognized

on derivatives for the

recognized

nine-month periods

Hedged items in

in income on

nine-month periods

in income on

ended September 30,

fair value hedge

related hedged

ended September 30,

derivatives

2023

2022

relationships

items

2023

2022

Derivatives in fair value hedging relationships

Commodity futures

Costs of goods sold

1,591

5,618

Firm commitments

Costs of goods sold

(423)

(2,146)

Inventory

Costs of goods sold

(217)

(1,440)

(640)

(3,586)

Derivatives not designated as hedging instruments

Commodity futures

Costs of goods sold

9,428

34,333

Derivatives accounted for as fair value hedges had ineffectiveness resulting in gains of ~~$348,000~~$172,000 and ~~$10,000~~losses of $151,000 during the three-month periods ended ~~June~~September 30, 2023 and 2022, respectively, and gains of ~~$47,000~~$219,000 and ~~$295,000~~$145,000 during the ~~six-month~~nine-month periods ended ~~June~~September 30, 2023 and 2022, respectively. Losses excluded from hedge effectiveness testing of $1.5 million increased cost of goods sold during the three-month period ended September 30, 2023, while gains excluded from hedge effectiveness testing of $817,000 decreased cost of goods sold during the three-month period ended September 30, 2022. Gains excluded from hedge effectiveness testing of ~~$1.4 million~~$732,000 and ~~$1.6~~$1.9 million decreased cost of goods sold during the ~~three-month~~nine-month periods ended ~~June 30, 2023, and 2022, respectively. Gains excluded from hedge effectiveness testing of $2.2 million and $1.1 million decreased cost of goods sold during the six months ended June~~September 30, 2023 and 2022, respectively.

Derivatives accounted for as cash flow hedges resulted in net losses of $2.3 million and net gains of ~~$321,000 and net losses of $21.4~~$10.0 million recognized in other comprehensive income for the three-month periods ended ~~June~~September 30, 2023 and 2022, respectively, and net losses of $38,000 and net gains of ~~$2.3 million and net losses of $3.2~~$6.8 million for the ~~six-month~~nine-month periods ended ~~June~~September 30, 2023 and 2022, respectively. Net ~~gains~~losses of ~~$1.3 million~~$341,000 and ~~$2.6~~$7.1 million were reclassified from accumulated other comprehensive income for the three-month periods ended ~~June~~September 30, 2023 and 2022, respectively, and net gains of ~~$2.1~~$1.8 million and net losses of ~~$599,000~~$7.7 million for the ~~six-month~~nine-month periods ended ~~June~~September 30, 2023 and 2022, respectively. At ~~June~~September 30, 2023, the company expects to reclassify all ~~$1.4 million~~$651,000 of net ~~gains~~losses on derivative instruments from accumulated other comprehensive income to earnings during the next 12 months due to the settlement of futures contracts. The maximum term over which the company is hedging its exposure to the variability of future cash flows for forecasted transactions is less than 12 months.

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STEEL DYNAMICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Note 6. Fair Value Measurements

Accounting standards provide a comprehensive framework for measuring fair value and sets forth a definition of fair value and establishes a hierarchy prioritizing the inputs to valuation techniques, giving the highest priority to quoted prices in active markets for identical assets and liabilities and the lowest priority to unobservable value inputs. Levels within the hierarchy are defined as follows:

●

Level 1—Unadjusted quoted prices for identical assets and liabilities in active markets;

●

Level 2—Quoted prices for similar assets and liabilities in active markets (other than those included in Level 1) which are observable for the asset or liability, either directly or indirectly; and

●

Level 3—Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

~~Table of Contents~~

~~STEEL DYNAMICS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)~~

~~Note 6. Fair Value Measurements (Continued)~~

The following table sets forth financial assets and liabilities measured at fair value on a recurring basis in the consolidated balance sheet and the respective levels to which the fair value measurements are classified within the fair value hierarchy as of ~~June~~September 30, 2023 and December 31, 2022 (in thousands):



			Quoted Prices		Significant						Quoted Prices		Significant
			in Active		Other		Significant				in Active		Other		Significant
			Markets for		Observable		Unobservable				Markets for		Observable		Unobservable
			Identical Assets		Inputs		Inputs				Identical Assets		Inputs		Inputs
	Total		(Level 1)		(Level 2)		(Level 3)		Total		(Level 1)		(Level 2)		(Level 3)
June 30, 2023
September 30, 2023
Short-term investments	$	611,701	$	-	$	611,701	$	-	$	500,844	$	-	$	500,844	$	-
Commodity futures – financial assets		31,400		-		31,400		-		6,666		-		6,666		-
Commodity futures – financial liabilities		16,377		-		16,377		-		5,857		-		5,857		-

December 31, 2022
Short-term investments	$	628,215	$	-	$	628,215	$	-	$	628,215	$	-	$	628,215	$	-
Commodity futures – financial assets		4,271		-		4,271		-		4,271		-		4,271		-
Commodity futures – financial liabilities		7,388		-		7,388		-		7,388		-		7,388		-

The carrying amounts of financial instruments including cash and equivalents, and restricted cash approximate fair value (Level 1). The fair values of short-term investments and commodity futures contracts are estimated by the use of quoted market prices, estimates obtained from brokers, and other appropriate valuation techniques based on references available (Level 2). The fair value of long-term debt, including current maturities, as determined by quoted market prices (Level 2), was approximately $2.7 billion at ~~June~~September 30, 2023 and December 31, 2022 (with a corresponding carrying amount in the consolidated balance sheet of $3.1 billion at ~~June~~September 30, 2023 and December 31, 2022).

Note 7. Commitments and Contingencies

The company is involved in various routine litigation matters, including administrative proceedings, regulatory proceedings, governmental investigations, environmental matters, and commercial and construction contract disputes, none of which are expected to have a material impact on the company’s financial condition, results of operations, or liquidity.

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STEEL DYNAMICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Note 8. Segment Information

The company’s operations are primarily organized and managed by reportable operating segments, which are steel operations, metals recycling operations, and steel fabrication operations. The segment operations are more fully described in Note 1 to the consolidated financial statements. Operating segment performance and resource allocations are primarily based on operating results before income taxes. The accounting policies of the reportable segments are consistent with those described in Note 1 to the consolidated financial statements. Intra-segment sales and any related profits are eliminated in consolidation. Amounts included in the category “Other” are from subsidiary operations that are below the quantitative thresholds required for reportable segments and primarily consist of joint ventures, including the company’s ~~newly announced~~ aluminum flat roll mill and satellite slab centers and the ~~company’s~~ idled Minnesota ironmaking operations. Also included in “Other” are certain unallocated corporate accounts, such as the company’s senior unsecured credit facility, senior notes, certain other investments and certain profit sharing expenses.

The company’s segment results, including disaggregated revenue by segment to external, external non-United States, and other segment customers, are as follows (in thousands):

~~Table of Contents~~

~~STEEL DYNAMICS, INC.~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)~~

~~Note 8. Segment Information (Continued)~~



			Metals		Steel												Metals		Steel
For the three-month period ended	Steel		Recycling		Fabrication										Steel		Recycling		Fabrication
June 30, 2023	Operations		Operations		Operations		Other			Eliminations			Consolidated
September 30, 2023															Operations		Operations		Operations		Other			Eliminations			Consolidated

Net sales - disaggregated revenue
External	$	3,123,476	$	368,561	$	779,374	$	259,963		$	-		$	4,531,374	$	2,904,204	$	334,922	$	630,045	$	247,123		$	-		$	4,116,294
External Non-U.S.		274,033		223,812		35		52,376			-			550,256		232,241		185,824		139		52,559			-			470,763
Other segments		210,724		575,752		189		269			(786,934)			-		124,622		531,559		3,023		172			(659,376)			-
		3,608,233		1,168,125		779,598		312,608			(786,934)			5,081,630		3,261,067		1,052,305		633,207		299,854			(659,376)			4,587,057
Operating income (loss)		702,646		33,005		462,080		(120,811)	⁽¹⁾		(13,185)			1,063,735		470,335		13,981		330,020		(95,638)	⁽¹⁾		14,852			733,550
Income (loss) before income taxes		703,887		38,225		462,207		(116,407)			(13,596)			1,074,316		472,051		15,319		329,554		(76,801)			14,476			754,599
Depreciation and amortization		81,590		20,761		2,422		6,197			-			110,970		81,517		17,195		2,448		6,258			-			107,418
Capital expenditures		101,806		25,259		7,138		224,077			-			358,280		111,843		83,858		5,581		357,079			-			558,361

As of June 30, 2023
As of September 30, 2023
Assets	$	8,802,562	$	1,418,244	$	1,148,279	$	3,357,423	⁽²⁾	$	(175,111)	⁽³⁾	$	14,551,397	$	8,665,334	$	1,475,378	$	972,462	$	3,947,177	⁽²⁾	$	(131,395)	⁽³⁾	$	14,928,956


Footnotes related to the three-month period ended June 30, 2023, segment results (in millions):
Footnotes related to the three-month period ended September 30, 2023, segment results (in millions):								Footnotes related to the three-month period ended September 30, 2023, segment results (in millions):

(1)	Corporate SG&A	$	(22.6)	(2)	Cash and equivalents	$	1,325.9	Corporate SG&A	$	(20.7)	(2)	Cash and equivalents	$	1,607.8
	Companywide equity-based compensation		(11.2)		Short-term and other investments		837.3	Companywide equity-based compensation		(11.5)		Short-term and other investments		729.0
	Company profit sharing component		(88.0)		Accounts receivable		50.8	Company profit sharing component		(63.6)		Accounts receivable		35.7
	Other, net		1.0		Inventories		117.4	Other, net		0.2		Inventories		126.6
		$	(120.8)		Property, plant and equipment, net		689.4		$	(95.6)		Property, plant and equipment, net		1,076.0
					Intra-company debt		35.7					Intra-company debt		37.0
					Investments in unconsolidated affiliates		231.5					Investments in unconsolidated affiliates		238.2
					Other		69.4					Other		96.9
						$	3,357.4						$	3,947.2

(3)	Elimination of intra-company receivables	$	(104.8)					Elimination of intra-company receivables	$	(76.7)
	Elimination of intra-company debt		(35.7)					Elimination of intra-company debt		(37.0)
	Other		(34.6)					Other		(17.7)
		$	(175.1)						$	(131.4)

Table of Contents

STEEL DYNAMICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Note 8. Segment Information (Continued)



			Metals		Steel
For the three-month period ended	Steel		Recycling		Fabrication
September 30, 2022	Operations		Operations		Operations		Other			Eliminations		Consolidated

Net sales - disaggregated revenue
External	$	3,512,202	$	328,187	$	1,140,272	$	314,104		$	-	$	5,294,765
External Non-U.S.		208,623		143,879		-		4,440			-		356,942
Other segments		152,719		512,559		5,554		-			(670,832)		-
		3,873,544		984,625		1,145,826		318,544			(670,832)		5,651,707
Operating income (loss)		654,677		6,735		676,726		(137,160)	⁽¹⁾		18,866		1,219,844
Income (loss) before income taxes		646,426		5,415		674,718		(136,613)			18,526		1,208,472
Depreciation and amortization		76,453		12,932		2,454		6,875			-		98,714
Capital expenditures		131,753		11,137		4,975		93,364			-		241,229

Metals

Steel

For the three-month period ended

Steel

Recycling

Fabrication

June 30, 2022

Operations

Operations

Operations

Other

Eliminations

Consolidated

Net sales - disaggregated revenue

External

$
3,929,646

$
476,093

$
1,085,710

$
330,574

$
-

$
5,822,023
External Non-U.S.

212,376

173,642

44

4,793

-

390,855
Other segments

104,594

706,247

4,444

372

(815,657)

-

4,246,616

1,355,982

1,090,198

335,739

(815,657)

6,212,878
Operating income (loss)

1,102,725

54,443

599,191

(162,194)
⁽¹⁾

23,898

1,618,063
Income (loss) before income taxes

1,086,795

53,446

596,763

(164,143)

23,556

1,596,417
Depreciation and amortization

73,962

13,021

2,433

6,285

-

95,701
Capital expenditures

135,864

15,199

4,569

8,510

-

164,142


Footnotes related to the three-month period ended September 30, 2022, segment results (in millions):

(1)	Corporate SG&A	$	(15.5)
	Companywide equity-based compensation		(14.6)
	Company profit sharing component		(103.8)
	Other, net		(3.3)
		$	(137.2)


Footnotes related to the three-month period ended June 30, 2022, segment results (in millions):

(1)	Corporate SG&A	$	(12.7)
	Companywide equity-based compensation		(8.8)
	Company profit sharing component		(136.7)
	Other, net		(4.0)			Metals		Steel
For the nine-month period ended				Steel		Recycling		Fabrication
September 30, 2023				Operations		Operations		Operations		Other			Eliminations		Consolidated
		$	(162.2)
Net sales - disaggregated revenue
External				$	8,874,866	$	1,086,286	$	2,278,121	$	859,415		$	-	$	13,098,688
External Non-U.S.					719,909		610,301		240		132,755			-		1,463,205
Other segments					460,156		1,685,770		3,248		441			(2,149,615)		-
					10,054,931		3,382,357		2,281,609		992,611			(2,149,615)		14,561,893
Operating income (loss)					1,514,741		86,674		1,343,372		(315,389)	⁽¹⁾		3,247		2,632,645
Income (loss) before income taxes					1,518,438		99,093		1,343,173		(286,104)			2,104		2,676,704
Depreciation and amortization					246,583		52,321		7,201		19,977			-		326,082
Capital expenditures					334,188		128,814		17,215		662,743			-		1,142,960

Metals

Steel

For the six-month period ended

Steel

Recycling

Fabrication

June 30, 2023

Operations

Operations

Operations

Other

Eliminations

Consolidated

Net sales - disaggregated revenue

External

$
5,970,662

$
751,364

$
1,648,076

$
612,292

$
-

$
8,982,394
External Non-U.S.

487,668

424,477

101

80,196

-

992,442
Other segments

335,534

1,154,211

225

269

(1,490,239)

-

6,793,864

2,330,052

1,648,402

692,757

(1,490,239)

9,974,836
Operating income (loss)

1,044,406

72,693

1,013,352

(219,751)
⁽¹⁾

(11,605)

1,899,095
Income (loss) before income taxes

1,046,387

83,774

1,013,619

(209,303)

(12,372)

1,922,105
Depreciation and amortization

165,066

35,126

4,753

13,719

-

218,664
Capital expenditures

222,345

44,956

11,634

305,664

-

584,599


Footnotes related to the six-month period ended June 30, 2023, segment results (in millions):
Footnotes related to the nine-month period ended September 30, 2023, segment results (in millions):				Footnotes related to the nine-month period ended September 30, 2023, segment results (in millions):

(1)	Corporate SG&A	$	(46.2)	Corporate SG&A	$	(66.9)
	Companywide equity-based compensation		(24.8)	Companywide equity-based compensation		(36.3)
	Company profit sharing component		(156.9)	Company profit sharing component		(220.5)
	Other, net		8.1	Other, net		8.3
		$	(219.8)		$	(315.4)

Table of Contents

STEEL DYNAMICS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Note 8. Segment Information (Continued)



			Metals		Steel											Metals		Steel
For the six-month period ended	Steel		Recycling		Fabrication
June 30, 2022	Operations		Operations		Operations		Other			Eliminations		Consolidated
For the nine-month period ended														Steel		Recycling		Fabrication
September 30, 2022														Operations		Operations		Operations		Other			Eliminations		Consolidated

Net sales - disaggregated revenue
External	$	7,502,848	$	924,136	$	2,015,552	$	627,695		$	-	$	11,070,231	$	11,015,050	$	1,252,323	$	3,155,824	$	941,799		$	-	$	16,364,996
External Non-U.S.		401,670		305,224		183		5,472			-		712,549		610,293		449,103		183		9,912			-		1,069,491
Other segments		273,751		1,269,839		4,563		1,030			(1,549,183)		-		426,470		1,782,398		10,117		1,030			(2,220,015)		-
		8,178,269		2,499,199		2,020,298		634,197			(1,549,183)		11,782,780		12,051,813		3,483,824		3,166,124		952,741			(2,220,015)		17,434,487
Operating income (loss)		2,265,735		99,403		1,066,066		(336,729)	⁽¹⁾		18,455		3,112,930		2,920,412		106,138		1,742,792		(473,889)	⁽¹⁾		37,321		4,332,774
Income (loss) before income taxes		2,239,011		99,176		1,061,962		(363,772)			17,770		3,054,147		2,885,437		104,591		1,736,680		(500,385)			36,296		4,262,619
Depreciation and amortization		140,644		26,275		4,863		11,465			-		183,247		217,097		39,207		7,317		18,340			-		281,961
Capital expenditures		272,054		26,756		8,259		16,403			-		323,472		403,807		37,893		13,234		109,767			-		564,701


Footnotes related to the six-month period ended June 30, 2022, segment results (in millions):
Footnotes related to the nine-month period ended September 30, 2022, segment results (in millions):				Footnotes related to the nine-month period ended September 30, 2022, segment results (in millions):

(1)	Corporate SG&A	$	(32.3)	Corporate SG&A	$	(47.8)
	Companywide equity-based compensation		(24.7)	Companywide equity-based compensation		(39.3)
	Company profit sharing component		(262.3)	Company profit sharing component		(366.1)
	Other, net		(17.4)	Other, net		(20.7)
		$	(336.7)		$	(473.9)

Table of Contents

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-Looking Statements

This report contains some predictive statements about future events, including statements related to conditions in domestic or global economies, conditions in steel, aluminum, and recycled metals market places, Steel Dynamics' revenues, costs of purchased materials, future profitability and earnings, and the operation of new, existing or planned facilities. These statements, which we generally precede or accompany by such typical conditional words as "anticipate", "intend", "believe", "estimate", "plan", "seek", "project", or "expect", or by the words "may", "will", or "should", are intended to be made as "forward-looking", subject to many risks and uncertainties, within the safe harbor protections of the Private Securities Litigation Reform Act of 1995. These statements speak only as of this date and are based upon information and assumptions, which we consider reasonable as of this date, concerning our businesses and the environments in which they operate. Such predictive statements are not guarantees of future performance, and we undertake no duty to update or revise any such statements. Some factors that could cause such forward-looking statements to turn out differently than anticipated include: (1) domestic and global economic factors; (2) global steelmaking overcapacity and imports of steel, together with increased scrap prices; (3) pandemics, epidemics, widespread illness or other health issues, such as COVID-19 or its variants; (4) the cyclical nature of the steel industry and the industries we serve; (5) volatility and major fluctuations in prices and availability of scrap metal, scrap substitutes and supplies, and our potential inability to pass higher costs on to our customers; (6) cost and availability of electricity, natural gas, oil, or other energy resources are subject to volatile market conditions; (7) increased environmental, greenhouse gas emissions and sustainability considerations or regulations; (8) compliance with and changes in environmental and remediation requirements; (9) significant price and other forms of competition from other steel and aluminum producers, scrap processors and alternative materials; (10) availability of an adequate source of supply of scrap for our metals recycling operations; (11) cybersecurity threats and risks to the security of our sensitive data and information technology; (12) the implementation of our growth strategy; (13) litigation and legal compliance; (14) unexpected equipment downtime or shutdowns; (15) governmental agencies may refuse to grant or renew some of our licenses and permits; (16) our senior unsecured credit facility contains, and any future financing agreements may contain, restrictive covenants that may limit our flexibility; and (17) the impacts of impairment charges.

More specifically, we refer you to our more detailed explanation of these and other factors and risks that may cause such predictive statements to turn out differently, as set forth in our most recent Annual Report on Form 10-K under the headings Special Note Regarding Forward-Looking Statements and Risk Factors for the year ended December 31, 2022, in our quarterly reports on Form 10-Q, or in other reports which we from time to time file with the Securities and Exchange Commission. These reports are available publicly on the Securities and Exchange Commission website, www.sec.gov, and on our website, www.steeldynamics.com under “Investors – SEC Filings.”

Description of the Business

We are one of the largest domestic steel producers and metal recyclers in the United States, based on estimated steelmaking and steel coating capacity of approximately 16 million tons and actual metals recycling volumes, with one of the most diversified product and end market portfolios in the domestic steel industry, combined with meaningful downstream steel fabrication operations. Our primary sources of revenue are from the manufacture and sale of steel products, the processing and sale of recycled ferrous and nonferrous metals, and the fabrication and sale of steel joists and deck products.

Operating Statement Classifications

Net Sales. Net sales from our operations are a factor of volumes shipped, product mix and related pricing. We charge premium prices for certain grades of steel, product dimensions, certain smaller volumes, and for value-added processing or coating of our steel products. Except for the steel fabrication operations, we recognize revenues from sales and the allowance for estimated returns and claims from these sales at the point in time control of the product transfers to the customer, upon shipment or delivery. Our steel fabrication operations recognize revenues over time based on completed fabricated tons to date as a percentage of total tons required for each contract.

Table of Contents

Costs of Goods Sold. Our costs of goods sold represent all direct and indirect costs associated with the manufacture of our products. The principal elements of these costs are scrap and scrap substitutes (which represent the most significant single component of our consolidated costs of goods sold), steel substrate, direct and indirect labor and related benefits, alloys, zinc, transportation and freight, repairs and maintenance, utilities such as electricity and natural gas, and depreciation.

Selling, General and Administrative Expenses. Selling, general and administrative expenses consist of all costs associated with our sales, finance and accounting, and administrative departments, including, among other items, labor and related benefits, and professional services.

Companywide profit sharing and amortization of intangible assets are each separately presented in the statement of income.

Interest Expense, net of Capitalized Interest. Interest expense consists of interest associated with our senior credit facilities and other debt, net of interest costs that are required to be capitalized during the construction period of certain capital investment projects.

Other (Income) Expense, net. Other income consists of interest income earned on our temporary cash deposits, short-term and other investments, and any other non-operating income activity, including income from investments in unconsolidated affiliates accounted for under the equity method. Other expense consists of any non-operating costs, such as certain acquisition and financing expenses.

Results Overview

In the ~~second~~third quarter of 2023 we achieved quarterly steel shipments of ~~3.2~~3.1 million tons, as steel demand remained ~~strong, most notably in the automotive, construction, energy, and industrial sectors.~~steady. Our metals recycling operations benefitted from ~~continued steady~~consistent domestic steel industry demand during the third quarter of 2023 compared to the same period in 2022, while our steel fabrication segment ~~again~~ achieved historically strong results on ~~continued~~ solid non-residential construction demand.

Consolidated operating income decreased ~~$554.3~~$486.3 million, or ~~34%~~40%, to ~~$1.1 billion~~$733.6 million for the ~~second~~third quarter of 2023, compared to the ~~second~~third quarter of ~~2022. Second~~2022 as metal spread contracted in our steel operations and steel fabrication operations had reduced volumes along with metal spread contraction. Third quarter 2023 net income attributable to Steel Dynamics, Inc. decreased ~~$397.4~~$337.1 million, or ~~33%~~37%, to ~~$812.1~~$577.2 million, compared to the ~~second~~third quarter of 2022, consistent with ~~the~~ decreased operating income.

Consolidated operating income decreased ~~$1.2~~$1.7 billion, or 39%, to ~~$1.9~~$2.6 billion for the first ~~half~~nine months of 2023, compared to the first ~~half~~nine months of 2022. Lower earnings were driven by metal spread contraction in our steel operations and reduced volumes in our steel fabrication operations. First ~~half~~nine months 2023 net income attributable to Steel Dynamics, Inc. decreased ~~$864.1 million~~$1.2 billion, or 37%, to ~~$1.4~~$2.0 billion, compared to the first ~~half~~nine months of 2022, consistent with ~~the~~ decreased operating income.

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Segment Operating Results 2023 vs. 2022 (dollars in thousands)



	Three Months Ended June 30,					Six Months Ended June 30,					Three Months Ended September 30,					Nine Months Ended September 30,
	2023		% Change		2022	2023		% Change	2022		2023		% Change		2022	2023		% Change	2022
Net sales:
Steel Operations Segment	$	3,608,233	(15)%	$	4,246,616	$	6,793,864	(17)%	$	8,178,269	$	3,261,067	(16)%	$	3,873,544	$	10,054,931	(17)%	$	12,051,813
Metals Recycling Operations Segment		1,168,125	(14)%		1,355,982		2,330,052	(7)%		2,499,199		1,052,305	7%		984,625		3,382,357	(3)%		3,483,824
Steel Fabrication Operations Segment		779,598	(28)%		1,090,198		1,648,402	(18)%		2,020,298		633,207	(45)%		1,145,826		2,281,609	(28)%		3,166,124
Other		312,608	(7)%		335,739		692,757	9%		634,197		299,854	(6)%		318,544		992,611	4%		952,741
		5,868,564			7,028,535		11,465,075			13,331,963		5,246,433			6,322,539		16,711,508			19,654,502
Intra-company		(786,934)			(815,657)		(1,490,239)			(1,549,183)		(659,376)			(670,832)		(2,149,615)			(2,220,015)
	$	5,081,630	(18)%	$	6,212,878	$	9,974,836	(15)%	$	11,782,780	$	4,587,057	(19)%	$	5,651,707	$	14,561,893	(16)%	$	17,434,487

Operating income (loss):
Steel Operations Segment	$	702,646	(36)%	$	1,102,725	$	1,044,406	(54)%	$	2,265,735	$	470,335	(28)%	$	654,677	$	1,514,741	(48)%	$	2,920,412
Metals Recycling Operations Segment		33,005	(39)%		54,443		72,693	(27)%		99,403		13,981	108%		6,735		86,674	(18)%		106,138
Steel Fabrication Operations Segment		462,080	(23)%		599,191		1,013,352	(5)%		1,066,066		330,020	(51)%		676,726		1,343,372	(23)%		1,742,792
Other		(120,811)	26%		(162,194)		(219,751)	35%		(336,729)		(95,638)	30%		(137,160)		(315,389)	33%		(473,889)
		1,076,920			1,594,165		1,910,700			3,094,475		718,698			1,200,978		2,629,398			4,295,453
Intra-company		(13,185)			23,898		(11,605)			18,455		14,852			18,866		3,247			37,321
	$	1,063,735	(34)%	$	1,618,063	$	1,899,095	(39)%	$	3,112,930	$	733,550	(40)%	$	1,219,844	$	2,632,645	(39)%	$	4,332,774

Steel Operations Segment

Steel operations consist of our electric arc furnace steel mills, producing steel from ferrous scrap and scrap substitutes, utilizing continuous casting, automated rolling mills, numerous value-added downstream steel coating and processing operations, and distribution operations. Our steel operations sell directly to end-users, steel fabricators, and service centers. These products are used in numerous industry sectors, including the construction, automotive, manufacturing, transportation, heavy and agriculture equipment, and pipe and tube (including OCTG) markets. Steel operations accounted for ~~67%~~68% and 66% of our consolidated net sales during the three-month periods ended ~~June~~September 30, 2023 and 2022, respectively and ~~the six-month period ended June 30, 2022,~~66% and ~~65%~~67% during the ~~six-month period~~nine-month periods ended ~~June~~September 30, ~~2023.~~2023 and 2022, respectively.

Steel Operations Segment Shipments (tons):



	Three Months Ended June 30,			Six Months Ended June 30,			Three Months Ended September 30,			Nine Months Ended September 30,
	2023	% Change	2022	2023	% Change	2022	2023	% Change	2022	2023	% Change	2022

Total shipments	3,211,275	3%	3,114,245	6,520,571	9%	6,009,073	3,104,251	(2)%	3,154,857	9,624,822	5%	9,163,930
Intra-segment shipments	(324,660)		(355,720)	(659,896)		(741,009)	(353,526)		(339,980)	(1,013,422)		(1,080,989)
Steel Operations Segment shipments	2,886,615	5%	2,758,525	5,860,675	11%	5,268,064	2,750,725	(2)%	2,814,877	8,611,400	7%	8,082,941

External shipments	2,703,031	0%	2,691,918	5,536,500	9%	5,101,681	2,632,617	(2)%	2,694,709	8,169,117	5%	7,796,390

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Steel Operations Segment Results 2023 vs. 2022

During the ~~second~~third quarter of 2023, our steel operations achieved ~~consistent~~ shipments of ~~3.2~~3.1 million tons ~~(2.9~~(2.8 million excluding intra-segment) consistent with the ~~sequential quarter,~~same period in 2022, including ~~356,000~~264,000 tons from ~~Sinton. Steel~~Sinton during the third quarter 2023. Customer order activity ~~remained~~and steel demand were steady ~~with~~during the ~~automotive, construction, industrial and energy sectors continuing to lead demand.~~quarter, supporting consistent shipping volumes excluding the lost volume of approximately 90,000 tons from our Sinton division’s unplanned July outage. Sheet steel pricing was ~~substantially~~15% lower than the ~~second~~third quarter of 2022, as prices steadily declined throughout the end of 2022 ~~but continued their upward trend during the first half~~and beginning of 2023. ~~Second~~Third quarter 2023 total steel segment average selling prices decreased ~~19%~~14%, or ~~$289~~$190 per ton, compared to ~~second~~third quarter of 2022. Steel operations segment shipments ~~increased 5%~~decreased 2% in the ~~second~~third quarter 2023, as compared to the same period in 2022. Net sales for the steel operations in the ~~second~~third quarter 2023 decreased ~~15%~~16% compared to the same period in 2022, due to the decrease in average steel selling prices ~~offsetting slightly increased~~and shipments. Net sales for the steel operations decreased 17%, in the first ~~half~~nine months of 2023 when compared to the same period in 2022, ~~again~~ due to the decrease in average steel selling prices more than offsetting increased shipments.

Metallic raw materials used in our electric arc furnaces represent our single most significant steel manufacturing cost, generally comprising approximately 55% to 65% of our steel mill operations’ manufacturing costs. Our metallic raw material cost per net ton consumed in our steel operations decreased ~~$94,~~$67, or ~~18%~~14%, in the ~~second~~third quarter of 2023, compared to the same period in 2022, consistent with overall decreased domestic scrap pricing noted below in the metals recycling operations segment discussion. In the first ~~half~~nine months of 2023, our metallic raw material cost per ton decreased ~~$79,~~$75, or ~~16%~~15%, compared to the same period in 2022.

AsIn the third quarter of 2023, as a result of average selling prices decreasing more than scrap costs, specifically for our sheet steel products, metal spread (which we define as the difference between average steel mill selling prices and the cost of ferrous scrap consumed in our steel mills) decreased ~~19% in the second quarter of 2023~~13% compared to the ~~second~~third quarter of 2022. As a result of this metal spread compression, operating income for the steel operations decreased ~~36%~~28%, to ~~$702.6~~$470.3 million, in the ~~second~~third quarter of 2023, compared to the same period in 2022. First ~~half~~nine months 2023 operating income decreased ~~54%~~48%, to ~~$1.0~~$1.5 billion, compared to the first ~~half~~nine months of 2022 due ~~primarily~~ to a ~~29%~~24% decrease in metal ~~spread.~~spread as reduced average steel selling prices more than offset lower scrap prices.

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Metals Recycling Operations Segment

Metals recycling operations includes both ferrous and nonferrous scrap metal processing, transportation, marketing, brokerage, and scrap management services. Our steel mills utilize a large portion of the ferrous scrap sold by our metals recycling operations as raw material in our steelmaking operations, and the remainder is sold to other consumers, such as other steel manufacturers and foundries. In the ~~second~~third quarters of 2023 and 2022, 62% and 68%, respectively, of metals recycling operations ferrous scrap was sold to our own steel mills, while our steel mill utilization (excluding Sinton) was ~~93%~~90% and ~~95%~~93% in the ~~second~~third quarters of 2023 and 2022, respectively. Metals recycling operations accounted for ~~12%~~11% and 8% of our consolidated net sales during the ~~three and six-month~~three-month periods ended ~~June~~September 30, 2023 and 2022, respectively, and 12% and 10% of our consolidated net sales during the ~~three and six-month~~nine-month periods ended ~~June~~September 30, ~~2022.~~2023 and 2022, respectively.

Metals Recycling Operations Segment Shipments:



	Three Months Ended June 30,			Six Months Ended June 30,			Three Months Ended September 30,			Nine Months Ended September 30,
	2023	% Change	2022	2023	% Change	2022	2023	% Change	2022	2023	% Change	2022
Ferrous metal (gross tons)
Total	1,520,164	12%	1,358,729	2,972,985	13%	2,623,951	1,442,964	9%	1,320,117	4,415,949	12%	3,944,068
Inter-company	(942,185)	2%	(920,728)	(1,827,603)	5%	(1,748,722)	(895,318)	(0)%	(896,933)	(2,722,921)	3%	(2,645,655)
External shipments	577,979	32%	438,001	1,145,382	31%	875,229	547,646	29%	423,184	1,693,028	30%	1,298,413

Nonferrous metals (thousands of pounds)
Total	279,763	5%	266,781	565,600	7%	527,671	279,877	9%	257,710	845,477	8%	785,381
Inter-company	(35,403)		(35,899)	(80,509)		(60,660)	(43,043)		(37,523)	(123,552)		(98,183)
External shipments	244,360	6%	230,882	485,091	4%	467,011	236,834	8%	220,187	721,925	5%	687,198

Metals Recycling Operations Segment Results 2023 vs. 2022

During the ~~second~~third quarter of 2023, our metals recycling operations continued ~~its positive momentum~~to benefit from ~~the first quarter, benefitting from modestly higher~~solid domestic steel industry demand, resulting in higher ferrous and nonferrous scrap ~~shipments. Net~~shipments compared to the same period in 2022, resulting in increased net sales of 7%. We were able to increase shipments even as domestic steel mill utilization rates declined slightly to approximately 76% in the third quarter of 2023, as compared to approximately 78% in the third quarter of 2022. Ferrous and nonferrous scrap average selling prices decreased ~~14%~~2% during the ~~second~~third quarter of 2023 compared to the same period in 2022, driven by decreased average selling prices for both ferrous and nonferrous metals, which more than offset increased shipping volumes. Domestic steel mill utilization rates were approximately 76% in the second quarter of 2023, as compared to approximately 82% in the second quarter of 2022. ~~Ferrous scrap average selling prices decreased 21% during the second quarter of 2023 compared to the same period in 2022, while average nonferrous scrap prices decreased 22%.~~ Ferrous metal spreads (which we define as the difference between average selling prices and the cost of purchased scrap) ~~decreased 28%~~increased 8% during the ~~second~~third quarter of 2023 compared to the same period in 2022, ~~while~~and nonferrous ~~metals~~metal spreads increased ~~43%~~11%. As a result of the ~~compressed ferrous~~increased metals spreads, metals recycling operations operating income ~~decreased 39%~~increased 108% to ~~$33.0~~$14.0 million in the ~~second~~third quarter of 2023 compared to the ~~second~~third quarter of 2022.

Net sales for our metals recycling operations in the first ~~half~~nine months of 2023 decreased 7%3% compared to the same period in 2022, ~~driven~~as increased shipments were more than offset by ~~decreased pricing while shipments increased. Ferrous scrap~~lower ferrous and nonferrous average selling prices that decreased ~~17%~~13% and 10%, respectively, during the first ~~half~~nine months of 2023 compared to the same period in ~~2022, while nonferrous average selling prices decreased 14%.~~2022. Ferrous and nonferrous shipments increased ~~13%~~12% and 7%8%, respectively, in the first ~~half~~nine months of 2023 compared to the same period in 2022. Ferrous metal spreads decreased 11%, while nonferrous metal spreads increased 14% in the first nine months of 2023 compared to the first ~~half of 2022. Ferrous metal spreads decreased 18%, while nonferrous metal spreads increased 16% in the first half of 2023 compared to the first half~~nine months of 2022. Metals recycling operations operating income in the first ~~half~~nine months of 2023 of ~~$72.7~~$86.7 million decreased ~~27%~~18% from the first ~~half~~nine months of 2022, as decreased ferrous metal spread more than offset increased shipments.

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Steel Fabrication Operations Segment

Steel fabrication operations include seven New Millennium Building Systems joist and deck plants located throughout the United States, and in Northern Mexico. Revenues from these plants are generated from the fabrication of steel joists, girders, trusses, and steel deck used within the non-residential construction industry. Steel fabrication operations accounted for ~~15%~~14% and ~~16%~~20% of our consolidated net sales during the ~~three and six-month~~three-month periods ended ~~June~~September 30, 2023 and 2022, respectively, and ~~17%~~15% and 18% of our consolidated net sales during the ~~three and six-month~~nine-month periods ended ~~June~~September 30, ~~2022.~~2023 and 2022, respectively.

Steel Fabrication Operations Segment Results 2023 vs. 2022

Our steel fabrication operations continue to benefit from the solid non-residential construction market, as evidenced by a strong order backlog that extends ~~into~~through the first quarter 2024. The continued onshoring of manufacturing, coupled with the robust U.S. infrastructure and Inflation Reduction Act programs and industrial ~~build-outs,~~construction, supports consistent strong demand. Net sales for the steel fabrication operations decreased ~~28%~~45% during the ~~second~~third quarter of 2023 compared to the record level earnings during the same period in 2022, as average selling prices decreased ~~$617~~$1,329 per ton, or ~~12%~~25%, ~~while~~and volume decreased ~~18%.~~26% from record volume during the third quarter of 2022. Net sales for the segment decreased ~~18%~~28% during the first ~~half~~nine months of 2023, compared to the same period in 2022, as volume ~~decreased 18%,~~ and average selling prices ~~were comparable year over year.~~decreased 21% and 9%, respectively.

The purchase of various steel products is the largest single cost of production for our steel fabrication operations, historically representing approximately two-thirds of the total cost of manufacturing. The average cost per ton of steel consumed decreased ~~30%~~24% in the ~~second~~third quarter 2023, as compared to the same period in 2022. As a result of decreased selling prices per ton more than offsetting decreased steel input costs per ton, metal spread (which we define as the difference between average selling prices and the cost of purchased steel) ~~decreased 3%~~contracted 26% in the ~~second~~third quarter of 2023 compared to the same period in 2022. This metal spread compression coupled with decreased volume resulted in operating income decreasing ~~23%~~51% to ~~$462.1~~$330.0 million in the ~~second~~third quarter 2023, compared to ~~$599.2~~$676.7 million in the same period in 2022. For the first ~~half~~nine months of 2023, operating income decreased ~~50%~~23% to ~~$1.0~~$1.3 billion compared to the first ~~half~~nine months of 2022, as a ~~16%~~1% increase in metal spread was more than offset by the ~~18%~~21% decrease in volume.

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Other Operations

~~Second~~Third Quarter Consolidated Results 2023 vs. 2022

Selling, General and Administrative Expenses. Selling, general and administrative expenses of ~~$141.2~~$145.9 million during the ~~second~~third quarter of 2023 increased ~~19%~~10% from ~~$118.4~~$132.6 million during the ~~second~~third quarter of ~~2022.~~2022 primarily due to an 11% increase in payroll and benefits expense related to the execution of our growth strategy during 2023. Selling, general and administrative expenses represented ~~2.8%~~3.2% and ~~1.9%~~2.3% of net sales during ~~second~~third quarter 2023 and 2022, respectively.

Profit sharing expense during the ~~second~~third quarter of 2023 of ~~$91.0~~$64.4 million decreased ~~35%~~39% from the ~~$139.7~~$105.1 million during the same period in 2022, consistent with decreased pretax earnings. Profit sharing expense for eligible employees is 8% of consolidated pretax income excluding noncontrolling interests and other items.

Interest Expense, net of Capitalized Interest. During the ~~second~~third quarter of 2023, interest expense was ~~$20.8~~$18.4 million, a decrease of ~~$4.9~~$6.9 million compared to the ~~second~~third quarter of 2022. The lower interest expense in the ~~second~~third quarter 2023 compared to the same period in 2022 was due to higher capitalized interest in 2023 related to construction at our Sinton and Heartland divisions and the aluminum flat rolled products ~~mill.~~mill and satellite slab centers.

Other (Income) Expense, net. Net other income was ~~$31.3~~$39.5 million in the ~~second~~third quarter of 2023, compared to ~~$4.0~~$14.0 million in the ~~second~~third quarter of 2022, due primarily to an increase in interest income of ~~$24.0~~$20.3 million associated with an increase in invested cash and short-term investments.

Income Tax Expense. ~~Second~~Third quarter 2023 income tax expense of ~~$258.1~~$174.8 million, at an effective income tax rate of 23.2%, decreased 40% compared to the $290.0 million, at an effective income tax rate of 24.0%, ~~decreased 32% compared to the $381.8 million, at an effective income tax rate of 23.9%,~~ during the ~~second~~third quarter of 2022, consistent with decreased pretax earnings.

First ~~Half~~Nine Months Consolidated Results 2023 vs. 2022

Selling, General and Administrative Expenses. Selling, general and administrative expenses of ~~$285.5~~$431.4 million during the first ~~half~~nine months of 2023 increased 6%7% from ~~$270.4~~$403.0 million during the first ~~half~~nine months of ~~2022.~~2022 primarily due to a 9% increase in payroll and benefits expense related to the execution of our growth strategy during 2023. Selling, general and administrative expenses represented ~~2.9%~~3.0% and 2.3% of net sales during the first ~~half~~nine months of 2023 and 2022, respectively.

Profit sharing expense during the first ~~half~~nine months of 2023 of ~~$160.6~~$225.0 million decreased 40% from the ~~$268.2~~$373.3 million during the same period in 2022, consistent with decreased pretax earnings.

Interest Expense, net of Capitalized Interest. During the first nine months of 2023, interest expense of $61.7 million decreased 9% from $67.7 million during the first nine months of 2022, due to higher capitalized interest in 2023.

Other (Income) Expense, net. Net other income was ~~$66.3~~$105.7 million in the first ~~half~~nine months of 2023, compared to expense of ~~$16.4~~$2.5 million in the first ~~half~~nine months of 2022, due primarily to an increase in interest income of ~~$49.4~~$69.7 million associated with an increase in our invested cash and short-term investments in the first ~~half~~nine months of 2023, as well as an increase in net earnings from investments in unconsolidated affiliates of ~~$13.2~~$6.7 million.

~~Interest Expense, net of Capitalized Interest.~~ ~~During the first half of 2023, interest expense of $43.3 million increased 2% from $42.3 million during the first half of 2022.~~

Income Tax Expense. First ~~half~~nine months 2023 income tax expense of ~~$461.6~~$636.4 million, ~~decreased 37% compared to the $732.1 million during the first half of 2022,~~ at an effective income tax rate of 23.8%, decreased 38% compared to the $1.0 billion, at an effective income tax rate of 24.0%, during ~~both periods,~~the first nine months of 2022, consistent with decreased pretax earnings.

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Liquidity and Capital Resources

Capital Resources and Long-term Debt. Our business is capital intensive and requires substantial expenditures for, among other things, the purchase and maintenance of equipment used in our operations, and to remain in compliance with environmental laws. Our short-term and long-term liquidity needs arise primarily from working capital requirements, capital expenditures, including expansion projects, principal and interest payments related to our outstanding indebtedness (no significant principal payments until the fourth quarter of 2024), dividends to our shareholders, and potential

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stock repurchases and acquisitions or investments. We have met and intend to continue to meet these liquidity requirements primarily with available cash and cash provided by operations, long-term borrowings, and we also have availability under our unsecured Revolver. Our liquidity at ~~June~~September 30, 2023, is as follows (in thousands):



Cash and equivalents	$	1,475,356	Cash and equivalents	$	1,765,467
Short-term and other investments		837,340	Short-term and other investments		729,018
Revolver availability		1,190,829	Revolver availability		1,190,683
Total liquidity	$	3,503,525	Total liquidity	$	3,685,168

Our total outstanding debt of $3.1 billion is consistent with our total outstanding debt at December 31, 2022. Our total long-term debt to capitalization ratio (representing our long-term debt, including current maturities, divided by the sum of our long-term debt, redeemable noncontrolling interests, and our total stockholders’ equity) was ~~26.1%~~25.9% and 27.7% at ~~June~~September 30, 2023 and December 31, 2022, respectively.

~~Our~~In the third quarter of 2023, we entered into a new unsecured credit agreement, replacing the previous one, which has a senior unsecured revolving credit facility (Facility), which provides a $1.2 billion ~~unsecured Revolver.~~Revolver and matures in July 2028. Subject to certain conditions, we have the ability to increase the Facility size by $500.0 million. The unsecured Revolver is available to fund working capital, capital expenditures, and other general corporate purposes. The Facility contains financial covenants and other covenants pertaining to our ability to incur indebtedness and permit liens on certain assets. Our ability to borrow funds within the terms of the unsecured Revolver is dependent upon our continued compliance with the financial and other covenants. At ~~June~~September 30, 2023, we had $1.2 billion of availability on the Revolver, ~~$9.2~~$9.3 million of outstanding letters of credit and other obligations which reduce availability, and there were no borrowings outstanding. Subsequent to June 30, the company entered into a new unsecured credit agreement, replacing the previous one, which has a senior unsecured credit facility (New Facility), which provides a $1.2 billion Revolver and matures in July 2028. Subject to certain conditions, we have the ability to increase the New Facility size by $500.0 million.

The financial covenants under our Facility state that we must maintain an interest coverage ratio of not less than 2.50:1.00. Our interest coverage ratio is calculated by dividing our last-twelve-months (LTM) consolidated Adjusted EBITDA as defined in the Facility (earnings before interest, taxes, depreciation, amortization, and certain other non-cash transactions as defined in the Facility) by our LTM gross interest expense, less amortization of financing fees. In addition, a debt to capitalization ratio of not more than 0.60:1.00 must be maintained. At ~~June~~September 30, 2023, our interest coverage ratio and debt to capitalization ratio were ~~43.08:~~38.48:1.00 and 0.26:1.00, respectively. We were, therefore, in compliance with these covenants at ~~June~~September 30, 2023, and we anticipate we will continue to be in compliance during the next twelve months.

Working Capital (representing excess of current assets over current liabilities). We generated cash flow from operations of ~~$1.5~~$2.7 billion in the first ~~half~~nine months of 2023 compared to ~~$1.8~~$3.3 billion in the same 2022 period. Working capital ~~increased $31.3~~decreased $295.5 million, or ~~11%~~5%, during the first ~~half~~nine months of 2023 to ~~$5.6~~$5.3 billion at ~~June~~September 30, 2023, due primarily to a ~~$289.2~~$362.3 million decrease in accounts receivable and inventories, a $127.4 million decrease in short-term investments, partially offset by a $205.0 million decrease in accrued payroll and benefits related to ~~the payment of the 2022~~ company-wide profit sharing, ~~partially offset by the current year’s accrual. Current assets~~consistent with decreased ~~$242.0 million due to a decrease in cash and equivalents and inventories, partially offset by an increase in accounts receivable.~~pretax earnings.

Capital Investments. During the first ~~half~~nine months of 2023, we invested ~~$584.6 million~~$1.1 billion in property, plant and equipment, primarily within our steel operations segment and ~~previously announced~~ aluminum flat roll mill and supporting satellite recycled aluminum slab centers, compared with ~~$323.5~~$564.7 million invested during the same period in 2022. As announced in 2022, we plan to invest $2.5 billion in a new state-of-the-art low-carbon aluminum flat roll mill with two supporting satellite recycled aluminum slab centers, which is planned to be funded by available cash and cash flow from operations. Related

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expenditures began in the third quarter of 2022 and are expected to continue through 2025. ~~We entered 2023 with ample~~Our liquidity of ~~$3.4~~$3.7 billion and ~~anticipate~~anticipated future operating cash flow generation is sufficient to provide for our planned 2023 capital requirements.

Cash Dividends. As a reflection of continued confidence in our current and future cash flow generation capability and financial position, we increased our quarterly cash dividend by 25% to $0.425 per share in the first quarter and continuing into the second ~~quarter~~and third quarters of 2023 (from $0.34 per share in 2022), resulting in declared cash dividends of ~~$143.0~~$212.5 million during the first ~~half~~nine months of 2023, compared to ~~$126.4~~$186.5 million during the same period in 2022. We paid cash

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dividends of ~~$131.1~~$201.8 million and ~~$115.0~~$177.1 million during the first ~~half~~nine months of 2023 and 2022, respectively. Our board of directors, along with executive management, approves the payment of dividends on a quarterly basis. The determination to pay cash dividends in the future is at the discretion of our board of directors, after taking into account various factors, including our financial condition, results of operations, outstanding indebtedness, current and anticipated cash needs and growth plans.

Other. Our board of directors has authorized share repurchase programs during prior years, the most recent of which occurred in November 2022 for a program of up to $1.5 billion of the company’s common stock. Under the share repurchase programs, purchases take place as and when we determine in open market or private transactions made based upon the market price of our common stock, the nature of other investment opportunities or growth projects, our cash flows from operations, and general economic conditions. The share repurchase programs do not require us to acquire any specific number of shares, and may be modified, suspended, extended, or terminated by us at any time. The share repurchase programs do not have an expiration date. There were ~~$734.2 million~~$1.1 billion and ~~$906.2 million~~$1.4 billion of share repurchases during the first ~~half~~nine months of 2023 and 2022, respectively. As of ~~June~~September 30, 2023, we had ~~$605.7~~$277.7 million remaining available to purchase under the November 2022 share repurchase program. On October 31, 2023, our board of directors authorized an additional share repurchase program of up to $1.5 billion of the company’s common stock.

Our ability to meet our debt service obligations and reduce our total debt will depend upon our future performance which, in turn, will depend upon general economic, financial, and business conditions, along with competition, legislation and regulatory factors that are largely beyond our control. In addition, we cannot assure that our operating results, cash flows, access to credit markets and capital resources will be sufficient for repayment of our indebtedness in the future. We believe that based upon current levels of operations and anticipated growth, cash flows from operations, together with other available sources of funds, including borrowings under our ~~Revolver,~~Facility, if necessary, will be adequate for the next twelve months for making required payments of principal and interest on our indebtedness, funding working capital requirements, and funding anticipated capital expenditures.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Commodity Risk

In the normal course of business, we are exposed to the market risk and price fluctuations related to the sale of our products and to the purchase of raw materials used in our operations, such as metallic raw materials, electricity, natural gas and its transportation services, fuel, air products, zinc, and electrodes. Our risk strategy associated with product sales has generally been to obtain competitive prices for our products and to allow operating results to reflect market price movements dictated by supply and demand.

Our risk strategy associated with the purchase of raw materials utilized within our operations has generally been to make some commitments with suppliers relating to future expected requirements for some commodities such as electricity, water, natural gas and its transportation services, fuel, air products, zinc, and electrodes. Certain of these commitments contain provisions which require us to “take or pay” for specified quantities without regard to actual usage for periods of generally up to 5 years for physical commodity requirements and commodity transportation requirements, with some extending beyond, and for up to 15 years for air products and 29 years for water products. We utilized such “take or pay” requirements during the past three years under these contracts. We believe that production requirements will be such that consumption of the products or services purchased under these commitments will occur in the normal production process.

In our metals recycling and steel operations, we have certain fixed price contracts with various customers and suppliers for future delivery of nonferrous and ferrous metals. Our risk strategy has been to enter into base metal financial contracts with the goal to protect the profit margin, within certain parameters, that was contemplated when we entered into the transaction with the customer or vendor. At ~~June~~September 30, 2023, we had a cumulative unrealized gain associated with these financial contracts of ~~$15~~$0.8 million, substantially all of which have a settlement date within the next twelve months. We believe the customer contracts associated with the financial contracts will be fully consummated.

ITEM 4. CONTROLS AND PROCEDURES

(a)

Evaluation of Disclosure Controls and Procedures

As required, we carried out an evaluation, under the supervision and with the participation of our principal executive officer and principal financial officer, of the effectiveness of our disclosure controls and procedures, as defined in rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the Exchange Act). Based on this evaluation, our principal executive officer and principal financial officer concluded that, as of ~~June~~September 30, 2023, the end of the period covered by this quarterly report, our disclosure controls and procedures were designed to provide and were effective to provide reasonable assurance that the information required to be disclosed by us in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the applicable rules and forms, and that it is accumulated and communicated to our management, including our principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure.

(b)

Changes in Internal Controls Over Financial Reporting

No changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) occurred during the fiscal quarter ended ~~June~~September 30, 2023, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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PART II OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We are involved in various litigation matters, including administrative proceedings, regulatory proceedings, governmental investigations, environmental matters, and commercial and construction contract disputes, none of which are currently expected to have a material impact on our financial condition, results of operations, or liquidity.

We may also be involved from time to time in various governmental investigations, regulatory proceedings or judicial actions seeking penalties, injunctive relief, and/or remediation under federal, state and local environmental laws and regulations. The United States EPA has conducted such investigations and proceedings involving us, in some instances along with state environmental regulators, under various environmental laws, including RCRA, CERCLA, the Clean Water Act and the Clean Air Act. Some of these matters have resulted in fines or penalties, exclusive of interest and costs, which did not exceed $1 million in aggregate, as of ~~June~~September 30, 2023.

ITEM 1A. RISK FACTORS

No material changes have occurred to the indicated risk factors as disclosed in our Annual Report on Form 10-K for the year ended December 31, 2022.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

We purchased the following equity securities registered by us pursuant to Section 12 of the Exchange Act during the three-month period ended ~~June~~September 30, 2023.


Period	Total Number of Shares Purchased	Average Price Paid per Share			Total Number of Shares Purchased as Part of Publicly Announced Programs ⁽¹⁾		Maximum Dollar Value of Shares That May Yet be Purchased Under the Programs (in thousands)⁽¹⁾				Total Number of Shares Purchased	Average Price Paid per Share			Total Number of Shares Purchased as Part of Publicly Announced Programs ⁽¹⁾		Maximum Dollar Value of Shares That May Yet be Purchased Under the Programs (in thousands)⁽¹⁾
Quarter ended June 30, 2023
Quarter ended September 30, 2023										Quarter ended September 30, 2023

April 1 - 30	1,242,409		$	106.58		1,242,409		$	850,995
May 1 - 31	2,091,969			98.18		2,091,969			647,688
June 1 - 30	419,067			101.20		419,067			605,705
July 1 - 31											815,946		$	105.37		815,946		$	520,601
August 1 - 31											945,020			105.69		945,020			421,729
September 1 - 30											1,396,878			104.14		1,396,878			277,731
	3,753,445					3,753,445					3,157,844					3,157,844

(1)	In November 2022, our board of directors authorized a share repurchase program of up to $1.5 billion of our common stock. On October 31, 2023, our board of directors authorized an additional share repurchase program of up to $1.5 billion of the company’s common stock.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

None.

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ITEM 5. OTHER INFORMATION

During the ~~three month~~three-month period ended ~~June~~September 30, 2023, none of the Company’s directors or executive officers adopted, modified or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement” as such terms are defined under Item 408 of Regulation S-K.

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ITEM 6. EXHIBITS

Reference is made to the Exhibit Index preceding the signature page hereto, which Exhibit Index is hereby incorporated into this item.

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EXHIBIT INDEX


Articles of Incorporation

3.1*3.1	Amended and Restated Articles of Incorporation of Steel Dynamics, Inc., reflecting all amendments thereto through May 11, 2023, incorporated herein by reference from Exhibit 3.1 to our Form 10-Q filed August 8, 2023.

3.2	Amended and Restated Bylaws of Steel Dynamics, Inc., reflecting all amendments thereto through January 23, 2023, incorporated herein by reference from Exhibit 3.2 to our Form 10-K filed February 28, ~~2023.~~

~~Material Contracts~~

~~10.62†~~	Steel Dynamics, Inc. 2023 Equity Incentive Plan, as approved by stockholders on May 11, 2023, incorporated herein by reference from our Notice of 2023 Annual Meeting & Proxy Statement filed March 30, 2023.

~~10.63~~	~~Credit Agreement dated as of July 19, 2023, among Steel Dynamics, Inc. and the agents and lenders named therein, incorporated herein by reference from Exhibit 10.62 to our Form 8-K filed July 21,~~ 2023.

Executive Officer Certifications

31.1*	Certification of Chief Executive Officer required by Item 307 of Regulation S-K as promulgated by the Securities and Exchange Commission and pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2*	Certification of Chief Financial Officer required by Item 307 of Regulation S-K as promulgated by the Securities and Exchange Commission and pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1*	Certification of Chief Executive Officer Pursuant to 18 U.S.C Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2*	Certification of Chief Financial Officer Pursuant to 18 U.S.C Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

XBRL Documents

101.INS*	XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

101.SCH*	Inline XBRL Taxonomy Extension Schema Document

101.CAL*	Inline XBRL Taxonomy Extension Calculation Document

101.DEF*	Inline XBRL Taxonomy Definition Document

101.LAB*	Inline XBRL Taxonomy Extension Label Document

101.PRE*	Inline XBRL Taxonomy Presentation Document

104*	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

Filed concurrently herewith

~~† Indicates a management contract or compensatory plan or arrangement~~

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

~~August 8,~~November 9, 2023

		STEEL DYNAMICS, INC.

	By:	/s/ Theresa E. Wagler
		Theresa E. Wagler
		Executive Vice President and Chief Financial Officer
		(Principal Financial Officer and Principal Accounting Officer)