CHARLOTTE, N.C., April 24, 2014 /PRNewswire/ -- Nucor Corporation (NYSE: NUE) announced today consolidated net earnings of $111.0 million, or $0.35 per diluted share, for the first quarter of 2014. By comparison, Nucor reported net earnings of $84.8 million, or $0.26 per diluted share, for the first quarter of 2013 and net earnings of $170.5 million, or $0.53 per diluted share, in the fourth quarter of 2013.
Nucor incurred a charge to value inventories using the last-in, first-out (LIFO) method of accounting of $14.5 million ($0.03 per diluted share) in the first quarter of 2014, compared with a charge of $18.0 million ($0.03 per diluted share) in the first quarter of 2013 and a charge of $17.4 million ($0.04 per diluted share) in the fourth quarter of 2013. Included in the first quarter of 2014 earnings was a $12.8 million ($0.04 per diluted share) charge primarily related to tax legislation changes in the state of New York. Also included in first quarter results is a $9.0 million charge ($0.02 per diluted share) related to the disposal of assets within the steel mills segment. Earnings in the fourth quarter of 2013 were impacted by an out-of-period non-cash gain of $21.3 million ($0.07 per diluted share) related to a correction to deferred tax balances.
Nucor's consolidated net sales increased 12% to $5.11 billion in the first quarter of 2014 from $4.55 billion in the first quarter of 2013 and increased 4% compared with $4.89 billion in the fourth quarter of 2013. Average sales price per ton increased 3% over the first quarter of 2013 and increased 1% over the fourth quarter of 2013. Total tons shipped to outside customers were 6,189,000 tons in the first quarter of 2014, an 8% increase over the first quarter of 2013 and a 3% increase over the fourth quarter of 2013, despite severe weather conditions. Total first quarter steel mill shipments increased 5% from the fourth quarter of 2013 and increased 7% over the first quarter of 2013. First quarter downstream steel products shipments to outside customers decreased 1% from the fourth quarter of 2013 and increased 13% over the first quarter of 2013.
The average scrap and scrap substitute cost per ton used during the first quarter of 2014 was $398, an increase of 5% from $379 in the first quarter of 2013 and an increase of 6% compared to $377 in the fourth quarter of 2013.
Overall operating rates at our steel mills increased to 75% in the first quarter of 2014 as compared to 72% in the first quarter of 2013 and were the same as the fourth quarter of 2013.
Total steel mill energy costs in the first quarter of 2014 increased approximately $5 per ton compared to the first quarter of 2013 and $7 per ton compared to the fourth quarter of 2013. The increases were attributable to increased natural gas and electricity unit costs.
Our liquidity position remains strong with $1.25 billion in cash and cash equivalents and short-term investments and an untapped $1.5 billion revolving credit facility that does not expire until August 2018.
We continue to be pleased with the progress of our new direct reduced iron (DRI) plant in St. James Parish, Louisiana. In the first quarter of 2014, the Louisiana DRI plant produced 455,000 tons with peak operating rates exceeding 90% of the name plate capacity while achieving world-class metallization and carbon percentages.
In February, Nucor's board of directors declared a cash dividend of $0.37 per share payable on May 12, 2014 to stockholders of record on March 31, 2014. This dividend is Nucor's 164th consecutive quarterly cash dividend, a record we expect to continue.
In March, a jury in a federal district court in Houston, Texas, returned a verdict against Nucor and five other co-defendants in an antitrust litigation brought by plaintiff MM Steel, LP, a steel plate service center located in Houston. The jury returned a verdict of $52 million in damages against all defendants jointly and severally. This amount is subject to trebling under the federal antitrust laws. The portion of damages, if any, that Nucor may be required to pay is unknown at this time. Nucor will continue to pursue all available post-trial motions and appeals to seek to have the verdict overturned. We continue to believe that MM Steel, LP's claims against Nucor are meritless and that Nucor acted entirely within its legal rights. Accordingly, we have not recorded a charge related to this case.
As expected, first quarter of 2014 earnings, excluding the impact of the tax and disposal of assets charges in the first quarter of 2014, were below the fourth quarter of 2013 levels, excluding the out-of-period tax adjustment in the fourth quarter of 2013. The largest factor contributing to this decrease was severe weather conditions, which disrupted customer demand, decreased the amount of railcar availability, contributed to increased energy costs at our steel mills and exacerbated conditions in the seasonally weaker performance of our fabricated construction products businesses. Additionally, import levels negatively impacted pricing and margins at our bar and sheet mills. Our operating performance did benefit from having no major extended planned outages at our steel mills during the first quarter.
We currently expect some improvement in second quarter of 2014 earnings from the first quarter of 2014, excluding the impact of the tax and disposal of assets charges incurred in the first quarter. We anticipate improved performance at both our steel mills and fabricated construction product businesses (rebar fabrication, joist and decking and pre-engineered metal buildings), although imports are expected to continue to pressure pricing and margins at our steel mills. We remain cautiously optimistic about the small but noticeable improvement in the nonresidential construction markets in 2014.
Nucor and affiliates are manufacturers of steel products, with operating facilities primarily in the U.S. and Canada. Products produced include: carbon and alloy steel -- in bars, beams, sheet and plate; steel piling; steel joists and joist girders; steel deck; fabricated concrete reinforcing steel; cold finished steel; steel fasteners; metal building systems; steel grating and expanded metal; and wire and wire mesh. Nucor, through The David J. Joseph Company, also brokers ferrous and nonferrous metals, pig iron and HBI/DRI; supplies ferro-alloys; and processes ferrous and nonferrous scrap. Nucor is North America's largest recycler.
Certain statements contained in this news release are "forward-looking statements" that involve risks and uncertainties. The words "believe," "expect," "project," "will," "should," "could" and similar expressions are intended to identify those forward-looking statements. Factors that might cause the Company's actual results to differ materially from those anticipated in forward-looking statements include, but are not limited to: (1) the sensitivity of the results of our operations to prevailing steel prices and the changes in the supply and cost of raw materials, including scrap steel; (2) market demand for steel products; (3) energy costs and availability; and (4) competitive pressure on sales and pricing, including competition from imports and substitute materials. These and other factors are discussed in Nucor's regulatory filings with the Securities and Exchange Commission, including those in Nucor's December 31, 2013 Annual Report on Form 10-K, Item 1A. Risk Factors. The forward-looking statements contained in this news release speak only as of this date, and Nucor does not assume any obligation to update them.
You are invited to listen to the live broadcast of Nucor's conference call in which management will discuss Nucor's first quarter results on April 24, 2014 at 2:00 p.m. eastern time. The conference call will be available over the Internet at www.nucor.com, under Investor Relations.
TONNAGE DATA |
(in thousands) |
|
|
|
|
|
|
|
|
|
|
| Three Months (13 Weeks) Ended |
|
|
| April 5, 2014 |
| March 30, 2013 |
| Percentage
Change |
Steel mills production |
| 5,194 |
| 4,818 |
| 8% |
Steel mills total shipments |
| 5,432 |
| 5,075 |
| 7% |
|
|
|
|
|
|
|
|
Sales tons to outside customers: |
|
|
|
|
| Steel mills |
| 4,600 |
| 4,334 |
| 6% |
| Joist |
| 92 |
| 71 |
| 30% |
| Deck |
| 87 |
| 69 |
| 26% |
| Cold finished |
| 138 |
| 122 |
| 13% |
| Fabricated concrete |
|
|
|
|
|
|
| reinforcing steel |
| 239 |
| 228 |
| 5% |
| Other |
| 1,033 |
| 882 |
| 17% |
|
|
| 6,189 |
| 5,706 |
| 8% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited) |
(In thousands, except per share data) |
|
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|
|
| Three Months (13 Weeks) Ended |
|
|
|
|
| April 5, 2014 |
| March 30, 2013 |
|
|
|
|
Net sales | $ 5,108,444 |
| $ 4,550,772 |
|
|
|
|
Costs, expenses and other: |
|
|
|
Cost of products sold | 4,731,242 |
| 4,247,556 |
Marketing, administrative and other expenses | 133,434 |
| 116,225 |
Equity in (earnings) losses of unconsolidated affiliates | (4,474) |
| 1,172 |
Interest expense, net | 40,741 |
| 32,491 |
| 4,900,943 |
| 4,397,444 |
Earnings before income taxes and |
|
|
|
noncontrolling interests | 207,501 |
| 153,328 |
Provision for income taxes | 77,805 |
| 42,600 |
Net earnings | 129,696 |
| 110,728 |
Earnings attributable to |
|
|
|
noncontrolling interests | 18,665 |
| 25,939 |
Net earnings attributable to |
|
|
|
Nucor stockholders | $ 111,031 |
| $ 84,789 |
|
|
|
|
Net earnings per share: |
|
|
|
Basic | $0.35 |
| $0.26 |
Diluted | $0.35 |
| $0.26 |
|
|
|
|
Average shares outstanding: |
|
|
|
Basic | 319,505 |
| 318,686 |
Diluted | 319,768 |
| 318,842 |
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) |
(In thousands) |
|
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|
|
| April 5, 2014 |
| Dec. 31, 2013 |
ASSETS |
|
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|
|
Current assets: |
|
|
|
|
| Cash and cash equivalents |
| $ 1,152,542 |
| $ 1,483,252 |
| Short-term investments |
| 100,000 |
| 28,191 |
| Accounts receivable, net |
| 1,900,293 |
| 1,810,987 |
| Inventories, net |
| 2,724,194 |
| 2,605,609 |
| Other current assets |
| 432,844 |
| 482,007 |
|
|
|
|
|
|
|
|
|
| Total current assets |
| 6,309,873 |
| 6,410,046 |
|
|
|
|
|
|
|
|
Property, plant and equipment, net |
| 4,960,948 |
| 4,917,024 |
|
|
|
|
|
|
|
|
Goodwill |
|
| 1,958,967 |
| 1,973,608 |
|
|
|
|
|
|
|
|
Other intangible assets, net |
| 851,013 |
| 874,154 |
|
|
|
|
|
|
|
|
Other assets |
| 1,037,210 |
| 1,028,451 |
|
|
|
|
|
|
|
|
|
| Total assets |
| $ 15,118,011 |
| $ 15,203,283 |
|
|
|
|
|
|
|
|
LIABILITIES |
|
|
|
|
Current liabilities: |
|
|
|
|
| Short-term debt |
| $ 27,072 |
| $ 29,202 |
| Long-term debt due within one year |
| 3,300 |
| 3,300 |
| Accounts payable |
| 1,062,572 |
| 1,117,078 |
| Federal income taxes payable |
| 29,582 |
| - |
| Salaries, wages and related accruals |
| 218,916 |
| 282,860 |
| Accrued expenses and other current liabilities |
| 554,526 |
| 527,776 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total current liabilities |
| 1,895,968 |
| 1,960,216 |
|
|
|
|
|
|
|
|
Long-term debt due after one year |
| 4,376,900 |
| 4,376,900 |
|
|
|
|
|
|
|
|
Deferred credits and other liabilities |
| 984,608 |
| 955,889 |
|
|
|
|
|
|
|
|
|
| Total liabilities |
| 7,257,476 |
| 7,293,005 |
|
|
|
|
|
|
|
|
EQUITY |
|
|
|
|
|
Nucor stockholders' equity: |
|
|
|
|
| Common stock |
| 151,025 |
| 151,010 |
| Additional paid-in capital |
| 1,849,737 |
| 1,843,353 |
| Retained earnings |
| 7,132,776 |
| 7,140,440 |
| Accumulated other comprehensive (loss) income, |
|
|
|
|
|
| net of income taxes |
| (35,797) |
| 9,080 |
| Treasury stock |
| (1,495,586) |
| (1,498,114) |
|
| Total Nucor stockholders' equity |
| 7,602,155 |
| 7,645,769 |
|
|
|
|
|
|
|
|
Noncontrolling interests |
| 258,380 |
| 264,509 |
|
|
|
|
|
|
|
|
|
| Total equity |
| 7,860,535 |
| 7,910,278 |
|
|
|
|
|
|
|
|
|
| Total liabilities and equity |
| $ 15,118,011 |
| $ 15,203,283 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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|
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) |
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Three Months (13 Weeks) Ended |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| April 5, 2014 |
| March 30, 2013 |
|
|
|
|
|
|
|
|
|
Operating activities: |
|
|
|
|
|
| Net earnings |
|
| $ 129,696 |
| $ 110,728 |
| Adjustments: |
|
|
|
|
|
|
| Depreciation |
|
| 161,480 |
| 130,425 |
|
| Amortization |
|
| 18,432 |
| 19,048 |
|
| Stock-based compensation | 5,408 |
| 6,035 |
|
| Deferred income taxes |
| 8,312 |
| 11,183 |
|
| Distribution from affiliates |
| - |
| 6,708 |
|
| Equity in (earnings) losses of unconsolidated affiliates | (4,474) |
| 1,172 |
|
| Loss on assets |
| 9,046 |
| - |
|
| Changes in assets and liabilities (exclusive of acquisitions and dispositions): |
|
|
|
|
|
| Accounts receivable |
| (97,183) |
| (90,688) |
|
|
| Inventories |
| (123,145) |
| (63,222) |
|
|
| Accounts payable |
| 7,489 |
| (175) |
|
|
| Federal income taxes |
| 56,526 |
| 11,654 |
|
|
| Salaries, wages and related accruals | (59,147) |
| (74,206) |
|
|
| Other operating activities | 36,774 |
| 60,149 |
|
|
|
|
|
|
|
|
|
Cash provided by operating activities | 149,214 |
| 128,811 |
|
|
|
|
|
|
|
|
|
Investing activities: |
|
|
|
|
|
| Capital expenditures |
| (258,058) |
| (330,585) |
| Investment in and advances to affiliates | (7,105) |
| (20,678) |
| Repayment of advances to affiliates | 3,000 |
| 7,500 |
| Disposition of plant and equipment | 4,540 |
| 2,958 |
| Acquisitions (net of cash acquired) | (1,408) |
| - |
| Purchases of investments |
| (100,000) |
| - |
| Proceeds from the sale of investments | 27,529 |
| 73,428 |
| Proceeds from the sale of restricted investments | - |
| 148,725 |
| Changes in restricted cash |
| - |
| (20,135) |
|
|
|
|
|
|
|
|
|
Cash used in investing activities |
| (331,502) |
| (138,787) |
|
|
|
|
|
|
|
|
|
Financing activities: |
|
|
|
|
|
| Net change in short-term debt |
| (2,130) |
| 12,512 |
| Excess tax benefits from stock-based compensation | 300 |
| 500 |
| Distributions to noncontrolling interests | (24,794) |
| (34,594) |
| Cash dividends |
|
| (118,680) |
| (117,618) |
| Other financing activities |
| (601) |
| 109 |
|
|
|
|
|
|
|
|
|
Cash used in financing activities |
| (145,905) |
| (139,091) |
|
|
|
|
|
|
|
|
|
Effect of exchange rate changes on cash | (2,517) |
| (1,095) |
|
|
|
|
|
|
|
|
|
Decrease in cash and cash equivalents | (330,710) |
| (150,162) |
|
|
|
|
|
|
|
|
|
Cash and cash equivalents - beginning of year | 1,483,252 |
| 1,052,862 |
|
|
|
|
|
|
|
|
|
Cash and cash equivalents - end of three months | $ 1,152,542 |
| $ 902,700 |
|
|
|
|
|
|
|
|
|
Non-cash investing activity: |
|
|
|
|
| Change in accrued plant and equipment purchases | $ (60,864) |
| $ (24,590) |
|
|
|
|
|
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CONTACT: Nucor Executive Offices, +1-704-366-7000, or fax, +1-704-362-4208
