At A Glance
8
[GRAPHIC]
BAR MILL GROUP BEAM MILL COLD FINISH GROUP
Products: Steel bars, angles and Products: Wide flange steel Products: Cold finished steel
other products for automotive, farm beams, pilings, heavy bars for shafting and
machinery, metal buildings, structural steel products for precision machined parts.
furniture, recreational equipment fabricators, manufacturers and
and other categories. steel service centers. Norfolk, Nebraska
Darlington, South Carolina
Darlington, South Carolina Mt. Pleasant, South Carolina Brigham City, Utah
Norfolk, Nebraska
Jewett, Texas PLATE MILL BUILDING SYSTEMS GROUP
Plymouth, Utah Products: Steel plate for Products: Metal buildings and
manufacturers of rail cars, metal building components for
SHEET MILL GROUP ships and barges, refinery commercial, industrial and
Products: Flat-rolled steel for tanks and others. institutional building markets.
appliances, pipes and tubes,
construction and other industries. Winton, North Carolina Waterloo, Indiana
Swansea, South Carolina
Crawfordsville, Indiana VULCRAFT GROUP Terrell, Texas
Hickman, Arkansas Products: Steel joists,
Mt. Pleasant, South Carolina joist girders and steel FASTENER DIVISION
deck for buildings. Products: Steel hexhead cap
NUCOR-YAMATO screws, structural bolts and hex
STEEL COMPANY Florence, South Carolina bolts for automotive, machine
Products: Super-wide flange Norfolk, Nebraska tool, farm implements, construction
steel beams, pilings, heavy Fort Payne, Alabama and military applications.
structural steel products for Grapeland, Texas
fabricators, manufacturers and St. Joe, Indiana St. Joe, Indiana
steel service centers. Brigham City, Utah
Chemung, New York CORPORATE OFFICE
Blytheville, Arkansas (Vulcraft of New York, Inc.) Charlotte, North Carolina
OPERATIONS REVIEW
9
- --------------------------------------------------------------------------------
BAR MILL GROUP, SHEET MILL GROUP, STRUCTURAL MILLS AND PLATE MILL The
manufacture of steel is a major area of operations for Nucor. Nucor operates
scrap-based steel mills in ten locations. These mills utilize modern steelmaking
techniques and produce steel at a cost competitive with steel manufactured
anywhere in the world.
- --------------------------------------------------------------------------------
BAR MILL GROUP
The Bar Mill Group has four mills located in South Carolina, Nebraska, Texas and
Utah that produce bars, angles and light structural carbon and alloy steels.
These bar products have wide usage including automotive, farm equipment, metal
buildings, furniture and recreational equipment. In constructing Nucor steel
mills, capital cost per ton of capacity has been lower than the capital cost
generally required for other steel mills. The first facility of the Nucor Bar
Mill Group was constructed in 1969 and has been extensively modernized. The next
three bar mills were constructed between 1973 and 1981. The total capital cost
of all four bar mills averaged about $170 per ton of current annual capacity.
Total capacity of the four bar mills exceeds 3,000,000 tons per year.
SHEET MILL GROUP
The Sheet Mill Group produces flat-rolled steel for appliances, pipes and tubes,
construction and other industries. The three sheet mills are located in Indiana,
Arkansas and South Carolina. The Nucor sheet mills were constructed between 1989
and 1996. The total cost of these sheet mills averaged about $305 per ton of
current annual capacity. The sheet mills utilize thin slab casters to produce
hot rolled sheet which can be further processed through cold rolling and
galvanizing. Nucor's sheet mills have a lower capital cost than integrated steel
mills producing these products. Total capacity of the sheet mills is about
5,900,000 tons per year.
STRUCTURAL MILLS
The Structural Mills produce wide flange steel beams, pilings and heavy
structural steel products for construction companies. In 1988, Nucor and Yamato
Kogyo, one of Japan's major producers of wide-flange beams, completed
construction of a beam mill located near Blytheville, Arkansas. Nucor owns a 51%
interest in Nucor-Yamato Steel Company. During 1999, Nucor started operations at
its 500,000 tons-per-year steel beam mill in South Carolina. Both mills use a
special continuous casting method that produces a beam blank closer in shape to
that of the finished beam than traditional methods. Current annual production
capacity of the structural mills is about 2,900,000 tons. The total capital
cost of the two structural mills averaged about $265 per ton of current
capacity.
PLATE MILL
Nucor's Plate Mill is located in North Carolina and produces steel plate for
manufacturers of rail cars, ships, barges, refinery tanks and others. During
2000, Nucor substantially completed construction of the 1,000,000 tons-per-year
steel plate mill. Casting and rolling began in October 2000. The start-up has
been extremely successful and the mill is producing high quality plate.
OPERATIONS REVIEW
10
OPERATIONS Nucor's steel mills are among the most modern and efficient mills in
the United States. Steel scrap is melted in electric arc furnaces and poured
into continuous casting systems. Highly sophisticated rolling mills convert the
billets and slabs into angles, rounds, channels, flats, sheet, beams, plate and
other products.
Production in 2000 was a record 11,271,000 tons, a 9% increase from 10,376,000
tons in 1999. Annual production capacity has grown from 120,000 tons in 1970 to
a present total of about 13,000,000 tons.
The operations in the rolling mills are highly automated and require fewer
operating employees than older mills. All Nucor steel mills have high
productivity, which results in employment costs of approximately 10% of the
sales dollar. This is lower than the employment costs of integrated steel
companies producing comparable products. Employee turnover in all mills is
extremely low. All employees have a significant part of their compensation based
on their productivity. Production employees work under group incentives that
provide increased earnings for increased production. This additional
compensation is paid weekly.
Steel mills are large consumers of electricity and gas. However, because of the
high efficiency of Nucor steel mills, these energy costs were less than 10% of
the sales dollar in 2000.
Scrap and scrap substitutes are the most significant element in the total cost
of steel. Their average cost increased to about $120 per gross ton used in 2000
from $111 per gross ton used in 1999.
MARKETS AND MARKETING About 87% of the ten steel mills' production in 2000 was
sold to outside customers and the balance was used internally by the Vulcraft
Group, Cold Finish Group, Building Systems Group and Fastener Division. Steel
sales to outside customers in 2000 were a record 9,779,000 tons, 12% higher than
the 8,734,000 tons in 1999.
The Bar Mill and Sheet Mill Groups' customers are primarily manufacturers and
steel service centers. The Structural and Plate Mills' customers are primarily
fabricators, manufacturers and steel service centers.
Nucor uses a simple, highly competitive pricing system that is less complicated
than the pricing structure traditional in the steel industry. For the bar and
structural mills, all customers in a region are charged the same published
price. This allows customers to maintain the lowest practical inventory. Because
of the specialized requirements of many customers of the sheet mills, pricing
can vary due to the additional costs of accommodating these requirements.
NEWER FACILITIES AND EXPANSIONS In 1998, Nucor substantially completed
construction and started operations of a major addition to Nucor's Hickman,
Arkansas steel sheet mill. This addition includes an 800,000 tons-per-year cold
rolling facility; a 500,000 tons-per-year galvanizing facility; and associated
pickling, oiling, and annealing facilities.
During 1999, Nucor completed construction and started operations of the 500,000
tons-per-year steel beam mill in South Carolina.
During 2000, Nucor started operations of the second caster addition at the steel
sheet mill in South Carolina. This addition cost more than $40,000,000 and
increased this mill's hot-band capacity from 1,500,000 tons to 2,300,000 tons
per year. Also during 2000, construction began on a second cold rolling facility
at the South Carolina sheet mill, which will increase this mill's cold rolled
steel capacity from 750,000 tons to 1,500,000 tons per year, at a cost of about
$40,000,000. Start-up should begin in the second quarter of 2001.
The steel plate mill in North Carolina started casting and rolling in October
2000. This facility, which has an annual capacity of 1,000,000 tons, cost about
$450,000,000.
OPERATIONS REVIEW
11
[BAR CHARTS APPEAR HERE]
OUTLOOK FOR THE FUTURE The manufacture of steel will continue to be a key factor
in Nucor's future performance. Total steel production is anticipated to
increase significantly over the next several years from the 11,271,000 tons
produced in 2000. Nucor anticipates additional expansions at our existing steel
mills, which could increase annual capacity to more than 13,000,000 tons per
year. Nucor also expects to obtain additional capacity through greenfield
construction and acquisitions. Although difficult business conditions that began
in the second half of 2000 are expected to continue through the first half of
2001, Nucor expects to continue to generate above-average earnings from its
steelmaking operations in the future.
OPERATIONS REVIEW
12
The VULCRAFT GROUP is the nation's largest producer of open-web steel joists,
joist girders and steel deck, which are used for building construction. This is
a major area of operations for Nucor.
OPERATIONS Steel joists and joist girders are produced and marketed nationally
through six Vulcraft facilities located in South Carolina, Nebraska, Alabama,
Texas, Indiana and Utah. Current annual production capacity is more than 650,000
tons. In 2000, Vulcraft produced 613,000 tons of steel joists and joist girders,
a decrease from the record 616,000 tons produced in 1999.
Materials, primarily steel, were about 40% of the joist sales dollar in 2000.
The Vulcraft Group obtained almost 90% of its steel requirements from the Nucor
Bar Mill Group. For 2000, freight costs for joists and joist girders were less
than 10% of the sales dollar. Vulcraft maintains an extensive fleet of trucks to
ensure and control on-time delivery.
The Vulcraft facilities in South Carolina, Nebraska, Alabama, Texas and Indiana
produce steel deck. Current deck annual production capacity is about 380,000
tons. Vulcraft steel deck sales decreased 6% from 375,000 tons in 1999 to
353,000 tons in 2000. Coiled sheet steel was about 65% of the steel deck sales
dollar in 2000.
Almost all of the production employees of Vulcraft work with a group incentive
system, which provides increased compensation each week for increased
performance.
During 2000, Nucor began construction on a Vulcraft facility in Chemung, New
York (Vulcraft of New York, Inc.) This facility will produce steel joists, joist
girders and steel deck and should cost about $50,000,000. Start-up is
anticipated in the third quarter of 2001.
MARKETS Steel joists, joist girders and steel decking are used extensively as
part of the roof and floor support systems in manufacturing buildings, retail
stores, shopping centers, warehouses, schools, churches, hospitals and, to a
lesser extent, in multi-story buildings and apartments. Building support systems
using joists, joist girders and steel deck are frequently more economical than
other systems.
Steel joists and joist girder sales are obtained by competitive bidding.
Vulcraft quotes on an estimated 80% to 90% of the domestic buildings using steel
joists, joist girders and steel deck as part of the support systems. In 2000,
Vulcraft supplied more than an estimated 40% of total domestic sales of steel
joists. Steel deck is specified in the majority of buildings using steel joists
and joist girders. In 2000, Vulcraft supplied more than 30% of total domestic
sales of steel deck.
Sales of steel joists, joist girders and steel deck are dependent on the
non-residential building construction market.
OPERATIONS REVIEW
13
[BAR CHART APPEARS HERE]
OUTLOOK FOR THE FUTURE The increased level of construction in recent years has
favorably impacted the volume of non-residential buildings supplied by the
Vulcraft Group. Prevailing economic projections call for a slow-down of building
construction in 2001, which will affect the sales of steel joists, joist girders
and steel deck and the earnings of Vulcraft.
OPERATIONS REVIEW
14
- --------------------------------------------------------------------------------
COLD FINISH GROUP, BUILDING SYSTEMS GROUP AND FASTENER DIVISION Nucor
manufactures a variety of products using steel from Nucor mills.
- --------------------------------------------------------------------------------
COLD FINISH GROUP
The Cold Finish Group has facilities in Nebraska, South Carolina and Utah. These
facilities produce cold drawn and turned, ground and polished steel bars that
are used extensively for shafting and machined precision parts. The Cold Finish
Group produces rounds, hexagons, flats and squares in carbon and alloy steels.
The total capacity of all three facilities is about 350,000 tons per year. All
three facilities are among the most modern in the world and use in-line
electronic testing to ensure outstanding quality. Nucor Cold Finish obtains most
of its steel from members of the Nucor Steel Mill Group. This factor, along with
the efficient facilities, results in highly competitive pricing.
In 2000, sales of cold finished steel products were 250,000 tons, an increase of
3% from 1999's 243,000 tons. The total cold finish market is estimated to be
more than 1,800,000 tons. The Cold Finish Group anticipates opportunities for
significant increases in sales and earnings during the next several years.
BUILDING SYSTEMS GROUP
The Building Systems Group produces pre-engineered metal building systems and
components in Indiana, South Carolina and Texas. With the start-up of the
building systems facility in Terrell, Texas during 2000, the annual capacity is
now more than 145,000 tons. The size of the buildings that can be produced
ranges from less than 500 square feet to more than 1,000,000 square feet. The
buildings are sold through a builder distribution network in order to provide
fast-track, customized solutions for building owners.
Building systems sales in 2000 were about 79,000 tons, an increase of 19% from
1999's 66,000 tons. The primary markets are commercial, industrial and
institutional buildings. The Building Systems Group obtains a significant
portion of its steel requirements from the Nucor Bar and Sheet Mill Groups.
FASTENER DIVISION
Nucor Fastener's state-of-the-art steel bolt-making facility in Indiana produces
standard steel hexhead cap screws hex bolts, socket head cap screws and
structural bolts. Fasteners are used in a broad range of markets, including
automotive, machine tools, farm implements, construction and military
applications.
Annual capacity is more than 75,000 tons, which is less than an estimated 20% of
the total market for these products. The modern facility allows Nucor Fastener
to maintain highly competitive pricing in a market currently dominated by
foreign suppliers. This operation is highly automated and has fewer employees
than comparable facilities. The Fastener Division obtains much of its steel from
the Nucor Bar Mill Group.
[BAR CHART APPEARS HERE]
ANALYSIS OF OPERATIONS AND FINANCES
15
OPERATIONS Nucor's business is the manufacture of steel products. During the
last five years, the sales of Nucor have increased 32% from $3,462,000,000 in
1995 to $4,586,000,000 in 2000. All of this growth has been internally
generated.
Net sales increased by 14% from 1999 to 2000, with more than 55% of the increase
due to increased volume, with additional benefit derived from increased sales
prices. 2000 was a record year for sales, primarily due to the performance in
the first half of the year. In the second half of 2000, demand decreased and
import levels increased significantly. The decrease in 1999 and 1998 sales
resulted from decreased sales prices. During 1998, 1999 and 2000, imports of
steel increased significantly, much of it at dumping prices. The effects of
these imports decreased during the latter part of 1999, but increased during
2000.
The major component of cost of products sold is raw material costs. The average
price of raw materials increased by less than 10% in 2000, decreased by 20% in
1999, and was substantially unchanged in 1998. The average scrap and scrap
substitute cost per ton used was $120 in 2000, $111 in 1999 and $142 in 1998. By
the end of the fourth quarter of 2000, the average scrap cost per ton used had
decreased to $109.
The major components of marketing, administrative and other expenses are freight
and profit sharing costs. Unit freight costs increased less than 5% in 2000,
were substantially unchanged in 1999 and increased slightly in 1998. Profit
sharing costs increased by 46% in 2000, decreased by 17% in 1999 and decreased
by 15% in 1998. Profit sharing costs are based upon and fluctuate with pre-tax
earnings. In 2000, profit sharing costs included over $6,200,000 for an
extraordinary bonus paid to employees for the achievement of record earnings
during the year. Every employee except for senior officers received $800.
Interest income, net of interest expense, decreased in 2000 as a result of
increased long-term debt and decreased average short-term investments. The
increases in 1999 and 1998 resulted from increased average short-term
investments.
Federal income taxes were at a rate of 35% for 2000, 35.5% for 1999 and 36.5%
for 1998.
The increase in 2000 earnings resulted primarily from increased margins and
increased volume. The decrease in 1999 earnings resulted primarily from
decreased sales prices. The decrease in 1998 earnings resulted primarily from
decreased margins and increased pre-operating and start-up costs of new
facilities.
Earnings were 14% of average equity in 2000, compared with 11% in 1999 and 13%
in 1998
LIQUIDITY AND CAPITAL RESOURCES In 2000, working capital decreased 18% from
$1,007,500,000 to $823,400,000, due primarily to decreased cash and short-term
investments resulting from the acquisition of treasury stock. The current ratio
was 2.5 in 2000, 2.9 in 1999 and 2.3 in 1998.
In 2000, inventories decreased slightly due to the decline in raw material costs
at the end of the year. The increase in 1999 and 1998 inventories was due
primarily to an increase in quantities of work-in-process and finished goods.
Capital expenditures are primarily for new facilities and expansion of existing
facilities. These expenditures were $415,400,000 in 2000, $374,700,000 in 1999
and $502,900,000 in 1998. Capital expenditures are currently projected to be
less than $300,000,000 in 2001. Funds provided from operations, existing credit
facilities and new borrowings are expected to be adequate to meet future capital
expenditure and working capital requirements.
Net long-term debt borrowings were $70,000,000 in 2000, $175,000,000 in 1999 and
$47,250,000 in 1998. Unused long-term credit facilities totaled $248,000,000 at
the end of 2000. The percentage of long-term debt to total capital (long-term
debt plus minority interests plus stockholders' equity) was 16% in 2000, 13% in
1999 and 8% in 1998. Nucor's objective is to maintain a strong balance sheet.
Nucor has the financial ability to borrow significant additional funds and still
maintain reasonable leverage.
During 2000, Nucor negotiated a comprehensive agreement with the United States
Environmental Protection Agency. The cost of complying with the terms of this
decree will not impact liquidity.
Nucor's directors have approved the purchase of up to 15,000,000 shares of Nucor
common stock. During 1998, 1999 and 2000, Nucor repurchased approximately
10,800,000 shares at a cost of approximately $445,000,000.
SIX-YEAR FINANCIAL REVIEW
18
- ------------------------------------------------------------------------------------------------------------------
2000 1999 1998 1997
- ------------------------------------------------------------------------------------------------------------------
For the year
Net sales $ 4,586,145,981 $ 4,009,346,082 $ 4,151,232,283 $ 4,184,497,854
Costs and expenses:
Cost of products sold 3,925,478,540 3,480,478,687 3,591,782,838 3,578,941,039
Marketing, administrative
and other expenses 183,175,557 154,773,600 147,973,101 145,409,693
Interest expense (income) (816,104) (5,095,299) (3,832,252) (35,318)
--------------- ------------------ ----------------- ---------------
4,107,837,993 3,630,156,988 3,735,923,687 3,724,315,414
Earnings before
federal income taxes 478,307,988 379,189,094 415,308,596 460,182,440
Federal income taxes 167,400,000 134,600,000 151,600,000 165,700,000
--------------- ------------------ ----------------- ---------------
Net earnings 310,907,988 244,589,094 263,708,596 294,482,440
Net earnings per share 3.80 2.80 3.00 3.35
Dividends declared per share .60 .52 .48 .40
Percentage of earnings to sales 6.8% 6.1% 6.4% 7.0%
Return on average equity 14.2% 11.3% 13.4% 16.9%
Capital expenditures 415,404,602 374,717,759 502,910,263 306,749,422
Depreciation 259,365,173 256,637,460 253,118,608 218,764,101
Sales per employee 597,193 547,762 591,596 622,554
- ------------------------------------------------------------------------------------------------------------------
At Year End
Current assets $ 1,381,446,907 $ 1,538,508,511 $ 1,129,467,383 $ 1,125,508,464
Current liabilities 558,068,452 531,030,898 486,897,157 524,453,610
--------------- ------------------ ----------------- ---------------
Working capital 823,378,455 1,007,477,613 642,570,226 601,054,854
Current ratio 2.5 2.9 2.3 2.1
Property, plant and equipment 2,340,340,812 2,191,339,477 2,097,078,473 1,858,874,894
Total assets 3,721,787,719 3,729,847,988 3,226,545,856 2,984,383,358
Long-term debt 460,450,000 390,450,000 215,450,000 167,950,000
Percentage of debt to capital 15.9% 13.3% 8.4% 7.2%
Stockholders' equity 2,130,951,640 2,262,247,906 2,072,551,781 1,876,425,866
Per share 27.47 25.96 23.73 21.32
Shares outstanding 77,582,948 87,133,737 87,352,906 87,996,583
Stockholders 51,000 55,000 62,000 50,000
Employees 7,900 7,500 7,200 6,900
- ------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------
1996 1995
- -----------------------------------------------------------------------
For the year
Net sales $ 3,647,030,387 $ 3,462,045,648
Costs and expenses:
Cost of products sold 3,139,157,919 2,900,168,171
Marketing, administrative
and other expenses 120,387,357 130,677,162
Interest expense (income) (283,837) (1,134,190)
--------------- ----------------
3,259,261,439 3,029,711,143
Earnings before
federal income taxes 387,768,948 432,334,505
Federal income taxes 139,600,000 157,800,000
--------------- ----------------
Net earnings 248,168,948 274,534,505
Net earnings per share 2.83 3.14
Dividends declared per share .32 .28
Percentage of earnings to sales 6.8% 7.9%
Return on average equity 16.6% 21.9%
Capital expenditures 537,438,406 263,421,786
Depreciation 182,232,851 173,887,657
Sales per employee 572,038 570,353
- -----------------------------------------------------------------------
At Year End
Current assets $ 828,380,585 $ 830,741,318
Current liabilities 465,652,755 447,136,311
--------------- ----------------
Working capital 362,727,830 383,605,007
Current ratio 1.8 1.9
Property, plant and equipment 1,791,152,821 1,465,400,015
Total assets 2,619,533,406 2,296,141,333
Long-term debt 152,600,000 106,850,000
Percentage of debt to capital 7.5% 6.2%
Stockholders' equity 1,609,290,193 1,382,112,159
Per share 18.33 15.78
Shares outstanding 87,795,947 87,598,517
Stockholders 39,000 39,000
Employees 6,600 6,200
- -----------------------------------------------------------------------
CONSOLIDATED STATEMENTS OF EARNINGS AND STOCKHOLDERS EQUITY
19
Consolidated Statements of Earnings
- ------------------------------------------------------------------------------------------------------------------------------------
Year Ended December 31, 2000 1999 1998
- ------------------------------------------------------------------------------------------------------------------------------------
Net sales $ 4,586,145,981 $4,009,346,082 $4,151,232,283
---------------- -------------- --------------
Costs and expenses:
Cost of products sold 3,925,478,540 3,480,478,687 3,591,782,838
Marketing, administrative and other expenses 183,175,557 154,773,600 147,973,101
Interest expense (income) (Note 9) (816,104) (5,095,299) (3,832,252)
---------------- -------------- --------------
4,107,837,993 3,630,156,988 3,735,923,687
---------------- -------------- --------------
Earnings before federal income taxes 478,307,988 379,189,094 415,308,596
Federal income taxes (Note 10) 167,400,000 134,600,000 151,600,000
---------------- -------------- --------------
Net earnings $ 310,907,988 $ 244,589,094 $ 263,708,596
================ ============== ==============
Net earnings per share (Note 6) $ 3.80 $ 2.80 $ 3.00
================ ============== ==============
- ------------------------------------------------------------------------------------------------------------------------------------
See notes to consolidated financial statements.
Consolidated Statements of Stockholders' Equity
- ----------------------------------------------------------------------------------------------------------------------
Additional Treasury Stock
Common Stock Paid-in Retained (at cost)
Shares Amount Capital Earnings Shares Amount
- ----------------------------------------------------------------------------------------------------------------------
Balances, December 31, 1997 89,987,108 $35,994,843 $62,041,288 $1,795,276,453 1,990,525 $16,886,718
- ----------------------------------------------------------------------------------------------------------------------
Net earnings in 1998 263,708,596
Employee stock options 64,677 25,871 2,943,785
Employee stock compensation
and service awards 2,267,863 (81,346) (1,324,800)
Treasury Stock acquired 789,700 32,016,119
Cash dividends ($.48 per share) (42,128,881)
- ----------------------------------------------------------------------------------------------------------------------
Balances, December 31, 1998 90,051,785 36,020,714 67,252,936 2,016,856,168 2,698,879 47,578,037
- ----------------------------------------------------------------------------------------------------------------------
Net earnings in 1999 244,589,094
Employee stock options 50,733 20,293 2,347,053
Employee stock compensation
and service awards 1,785,220 (53,396) (1,070,449)
Treasury stock acquired (478,642) 323,298 14,283,103
Cash dividends ($.52 per share) (45,354,239)
- ----------------------------------------------------------------------------------------------------------------------
Balances, December 31, 1999 90,102,518 36,041,007 70,906,567 2,216,091,023 2,968,781 60,790,691
- ----------------------------------------------------------------------------------------------------------------------
Net earnings in 2000 310,907,988
Employee stock options 9,620 3,848 409,508
Employee stock compensation
and service awards 401,879 (108,647) (3,921,444)
Treasury stock acquired (223,284) 9,669,056 398,504,348
Cash dividends ($.60 per share) (48,213,301)
- ----------------------------------------------------------------------------------------------------------------------
Balances, December 31, 2000 90,112,138 $36,044,855 $71,494,670 $2,478,785,710 12,529,190 $455,373,595
- ----------------------------------------------------------------------------------------------------------------------
Consolidated Balance Sheets
20
December 31, 2000 1999
- ---------------------------------------------------------------------------------------
Assets
Current assets:
Cash and short-term investments $ 490,576,279 $ 572,185,451
Accounts receivable (Note 2) 350,184,329 393,763,651
Inventories (Note 3) 461,151,913 464,983,651
Other current assets (Note 10) 79,534,386 107,575,758
-------------- --------------
Total current assets 1,381,446,907 1,538,508,511
Property, plant and equipment (Note 4) 2,340,340,812 2,191,339,477
-------------- --------------
$3,721,787,719 $3,729,847,988
============== ==============
Liabilities and stockholders' equity
Current liabilities:
Accounts payable $ 203,334,079 $ 255,229,202
Federal income taxes - 2,455,851
Salaries, wages and related accruals 134,953,274 116,749,067
Accrued expenses and other current liabilities 219,781,099 156,596,778
-------------- --------------
Total current liabilities 558,068,452 531,030,898
-------------- --------------
Long-term debt due after one year (Note 5) 460,450,000 390,450,000
-------------- --------------
Deferred credits and other liabilities (Note 10) 260,054,154 265,247,949
-------------- --------------
Minority interests 312,263,473 280,871,235
-------------- --------------
Stockholders' equity (Note 6):
Common stock 36,044,855 36,041,007
Additional paid-in capital 71,494,670 70,906,567
Retained earnings 2,478,785,710 2,216,091,023
-------------- --------------
2,586,325,235 2,323,038,597
Treasury stock (455,373,595) (60,790,691)
-------------- --------------
2,130,951,640 2,262,247,906
-------------- --------------
$3,721,787,719 $3,729,847,988
============== ==============
See notes to consolidated financial statements.
Consolidated Statements of Cash Flows
21
Year Ended December 31, 2000 1999 1998
- -----------------------------------------------------------------------------------------------------------------
Operating activities:
Net earnings $ 310,907,988 $ 244,589,094 $ 263,708,596
Adjustments:
Depreciation 259,365,173 256,637,460 253,118,608
Deferred federal income taxes 19,400,000 10,600,000 (1,000,000)
Minority interests 151,275,438 85,651,646 102,469,931
Changes in:
Accounts receivable 43,579,322 (94,518,857) 87,107,818
Inventories 3,831,738 (29,098,813) (38,836,459)
Accounts payable (51,895,123) 56,899,431 (61,938,344)
Federal income taxes (4,359,890) (23,634,420) 16,101,428
Other 86,650,021 97,708,808 21,167,751
---------- ---------- ----------
Cash provided by operating activities 820,754,667 604,834,349 641,899,329
- -----------------------------------------------------------------------------------------------------------------
Investing activities:
Capital expenditures (415,404,602) (374,717,759) (502,910,263)
Disposition of plant and equipment 5,128,217 442,250 2,924,833
---------- ---------- ----------
Cash used in investing activities (410,276,385) (374,275,509) (499,985,430)
- -----------------------------------------------------------------------------------------------------------------
Financing activities:
Increase in long-term debt 70,000,000 175,000,000 47,250,000
Issuance of common stock 4,736,679 5,223,015 6,562,319
Distributions to minority interests (119,883,200) (87,176,880) (96,265,895)
Cash dividends (48,213,301) (45,354,239) (42,128,881)
Acquisition of treasury stock (398,727,632) (14,761,745) (32,016,119)
---------- ---------- ----------
Cash provided by (used in) financing activities (492,087,454) 32,930,151 (116,598,576)
- -----------------------------------------------------------------------------------------------------------------
Increase (decrease) in cash and short-term investments (81,609,172) 263,488,991 25,315,323
Cash and short-term investments - beginning of year 572,185,451 308,696,460 283,381,137
---------- ---------- ----------
Cash and short-term investments - end of year $ 490,576,279 $ 572,185,451 $ 308,696,460
============= ============= =============
- -----------------------------------------------------------------------------------------------------------------
See notes to consolidated financial statements.
Notes to Consolidated Financial Statements
22
Years Ended December 31, 2000, 1999, and 1998
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Nucor is a manufacturer of steel
products, and reports in one segment.
The consolidated financial statements include Nucor and all of its subsidiaries.
The minority interests in operations of less than 100%-owned subsidiaries are
included in cost of products sold. All significant intercompany transactions are
eliminated. Investments in joint ventures with ownership of less than 50% are
accounted for under the equity method.
Short-term investments are recorded at cost plus accrued interest, which
approximates market, and will be converted into cash within three months from
date of purchase.
Inventories are stated at the lower of cost or market. Cost is determined
principally using the last-in, first-out (LIFO) method of accounting.
Property, plant and equipment are stated at cost. Depreciation is provided on a
straight-line basis over the estimated useful lives of the assets.
Liabilities are recorded for the estimated costs of complying with various
regulations and involvement in judicial and administrative proceedings,
including matters related to contracts, torts, environment, taxes and insurance.
Actual costs could differ from these estimates.
2. ACCOUNTS RECEIVABLE: Accounts receivable are stated net of the allowance for
doubtful accounts of $27,573,485 in 2000 ($21,093,233 in 1999 and $16,275,198 in
1998).
3. INVENTORIES: Inventories consist of approximately 45% raw materials and
supplies, and 55% finished and semi-finished products in 2000 (50% and 50% in
1999). Inventories valued using the last-in, first-out (LIFO) method of
accounting represent approximately 85% of total inventories in 2000 and 1999. If
the first-in, first-out (FIFO) method of accounting had been used, inventories
would have been $19,358,398 higher in 2000 ($28,590,595 higher in 1999). Use of
the lower of cost or market reduced inventories by $2,498,447 in 2000 ($319,625
in 1999).
4. PROPERTY, PLANT AND EQUIPMENT: The average annual depreciation rate was 7.2%
in 2000 (7.7% in 1999 and 8.3% in 1998).
December 31, 2000 1999
- -------------------------------------------------------------------
Land and improvements $ 94,537,956 $ 69,626,548
Buildings and improvements 357,440,801 313,624,168
Machinery and equipment 3,482,931,960 3,003,385,098
Construction in process
and equipment deposits 89,925,106 293,286,692
-------------- --------------
4,024,835,823 3,679,922,506
Less accumulated depreciation 1,684,495,011 1,488,583,029
- -------------------------------------------------------------------
$2,340,340,812 $2,191,339,477
============== ==============
5. LONG-TERM DEBT AND FINANCING ARRANGEMENTS: SEVEN BANKS ARE COMMITTED TO LEND
NUCOR A TOTAL OF $248,000,000 (NOTHING HAS BEEN BORROWED), WITH BORROWINGS, IF
ANY, REPAYABLE IN 2003 ($10,000,000), 2004 ($20,000,000), 2005 ($20,000,000) AND
2006 ($198,000,000). THESE COMMITMENTS CANNOT BE WITHDRAWN UNLESS THERE IS
NON-COMPLIANCE UNDER THE LOAN AGREEMENTS.
Annual aggregate long-term debt maturities are: none in 2002; $300,000 in 2003;
$300,000 in 2004; and $300,000 in 2005.
The fair value of Nucor's long-term debt approximates the carrying value.
December 31, 2000 1999
- -------------------------------------------------------------------
Industrial revenue bonds,
4.5% to 8%,
due from 2003 to 2033 $285,450,000 $215,450,000
Notes payable, 6%, due 2009 175,000,000 175,000,000
- -------------------------------------------------------------------
$460,450,000 $390,450,000
============ =============
Notes to Consolidated Financial Statements
23
6. CAPITAL STOCK: The par value of Nucor's common stock is $.40 Per share and
there are 200,000,000 shares authorized.
Nucor's Key Employees' Incentive Stock Option Plans provide that common stock
options may be granted to key employees and officers at 100% of the market value
on the date of the grant. During 2000, options were granted for 482,431 shares
(209,459 in 1999 and 203,812 in 1998); and options for 167,498 shares (111,407
in 1999 and 99,182 in 1998) expired or were canceled. At December 31, 2000,
options for 990,630 shares (685,317 in 1999 and 637,998 in 1998) were
outstanding at an aggregate exercise price of $44,185,270 ($33,137,733 in 1999
and $32,345,526 in 1998); options for 710,386 shares (583,619 in 1999 and
525,203 in 1998) were exercisable; and 2,180,737 shares (2,607,413 in 1999 and
2,805,106 in 1998) were reserved for future grants.
250,000 shares of preferred stock, par value of $4.00 per share, are authorized,
with preferences, rights and restrictions as may be fixed by Nucor's Board of
Directors. No shares of preferred stock have been issued since their
authorization in 1964.
Nucor's basic earnings per share of common stock are based on 81,762,429 average
shares outstanding in 2000 (87,247,160 in 1999 and 87,861,501 in 1998). If all
employee stock options were exercised, diluted earnings per share would not be
materially different than basic earnings per share. The pro-forma income effect
of fair value accounting for stock opions is immaterial for all periods
presented.
7. CONTINGENCIES: Nucor is subject to environmental laws and regulations
established by federal, state and local authorities; and makes provision for the
estimated costs related to compliance. Of the total $130,147,000 of accrued
environmental costs at December 31, 2000 ($99,215,000 in 1999 and $74,390,000 in
1998), $63,097,000 was classified in accrued expenses and other current
liabilities ($21,681,000 in 1999 and $19,573,000 in 1998) and $67,050,000 was
classified in deferred credits and other liabilities ($77,534,000 in 1999 and
$54,817,000 in 1998). In December 2000, Nucor entered into a consent decree with
the United States Environmental Protection Agency and certain states in order to
resolve alleged environmental violations. Under terms of this decree, Nucor will
conduct testing at some of its facilities, perform corrective action where
necessary, and pilot certain pollution control technologies.
8. EMPLOYEE BENEFIT PLANS: Nucor has a Profit Sharing and Retirement Savings
Plan for qualified employees. Nucor's expense for these benefits was $49,280,977
in 2000 ($39,195,491 in 1999 and $47,379,373 in 1998). Nucor also has a medical
plan covering certain eligible early retirees. The unfounded obligation,
included in deferred credits and other liabilities in the balance sheet, totaled
$32,347,105 in 2000 ($29,395,000 in 1999). Expense associated with this plan was
$3,038,714 in 2000 ($4,117,480 in 1999).
9. INTEREST EXPENSE (INCOME): Interest expense is stated net of interest income
of $23,264,824 in 2000 ($25,610,881 in 1999 and $13,832,452 in 1998). Interest
paid was $21,625,267 in 2000 ($14,692,106 in 1999 and $9,362,617 in 1998).
10. FEDERAL INCOME TAXES:
2000 1999 1998
- --------------------------------------------------------------------------
Currently payable $148,000,000 $124,000,000 $152,600,000
Deferred 19,400,000 10,600,000 (1,000,000)
- --------------------------------------------------------------------------
$167,400,000 $134,600,000 $151,600,000
============ ============ ============
Current deferred federal income tax assets of approximately $75,000,000 in 2000
($90,400,000 in 1999) relate primarily to differences between financial and tax
reporting of inventories and accrued expenses. Non-current deferred federal
income tax liabilities of approximately $105,000,000 in 2000 ($101,000,000 in
1999) relate primarily to differences between financial and tax reporting of
depreciation. Federal income taxes paid were $152,400,000 in 2000 ($147,400,000
in 1999 and $158,700,000 in 1998).
Notes to Consolidated Financial Statements
24
11. QUARTERLY INFORMATION (UNAUDITED):
First Second Third Fourth
2000 December 31, Quarter Quarter Quarter Quarter
- ---------------------------------------------------------------------------------------------------
Net sales $1,199,634,778 $1,213,945,302 $1,163,088,140 $1,009,477,761
Gross margin 167,884,777 176,874,378 154,353,874 161,554,412
Net earnings 81,489,845 81,803,693 67,794,472 79,819,978
Net earnings per share .94 .98 .85 1.03
- ---------------------------------------------------------------------------------------------------
1999
Net sales $ 893,822,966 $ 997,166,323 $1,026,687,893 $1,091,668,870
Gross margin 74,916,287 112,796,954 150,359,993 190,794,161
Net earnings 28,173,392 50,647,213 68,161,966 97,606,523
Net earnings per share .32 .58 .78 1.12
- ---------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Independent Accountants Report
- --------------------------------------------------------------------------------
PricewaterhouseCoopers LLP
February 1, 2001
Stockholders and
Board of Directors
Nucor Corporation
In our opinion, the accompanying consolidated balance sheets and the related
consolidated statements of earnings, stockholders' equity and cash flows present
fairly, in all material respects, the financial position of Nucor Corporation
and subsidiaries as of December 31, 2000 and 1999, and the results of their
operations and their cash flows for each of the three years in the period ended
December 31, 2000, in conformity with accounting principles generally accepted
in the United States. These financial statements are the responsibility of
Nucor's management; our responsibility is to express an opinion on these
financial statements based on our audits. We conducted our audits of these
statements in accordance with auditing standards generally accepted in the
United States which require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for the opinion expressed above.
/s/ PricewaterhouseCoopers LLP
Charlotte, North Carolina
BOARD OF DIRECTORS AND EXECUTIVE MANAGEMENT
25
Board of Directors Jeffrey M. Kemp John J. Ferriola
General Manager of Business Vice President, General Manager
H. David Aycock Development and Strategic Management Sheet Mill Group
Former Chairman, President and Crawfordsville, Indiana
Chief Executive Officer, Norman L. Maero
Nucor Corporation General Manager of Construction Ladd R. Hall
Vice President, General Manager
Peter C. Browning K. Rex Query Sheet Mill Group, Beam Mill
Non-Executive Chairman, General Manager and Mt. Pleasant, South Carolina
Nucor Corporation Corporate Controller
Donald N. Holloway
Daniel R. DiMicco Steven J. Rowlan Vice President, General Manager
President and General Manager of Vulcraft Group, Cold Finish Group
Chief Executive Officer, Environmental Affairs Norfolk, Nebraska
Nucor Corporation
A. Rae Eagle James R. Landrum
Harvey B. Gantt Corporate Secretary Vice President, General Manager
Partner, Gantt Huberman Architects Vulcraft Group
Operations Grapeland, Texas
Victoria F. Haynes
President, James R. Beard Harry R. Lowe
Research Triangle Institute Vice President, General Manager Vice President, General Manager
Vulcraft Group, Cold Finish Group Building Systems Group
James D. Hlavacek Brigham City, Utah Waterloo, Indiana
Managing Director,
Market Driven Management A. Jay Bowcutt Raymond Napolitan, Jr.
Vice President, General Manager General Manager
Samuel Siegel Bar Mill Group Building Systems Group
Vice Chairman, Plymouth, Utah Terrell, Texas
Former Chief Financial Officer,
Nucor Corporation James E. Campbell Robert M. Proia
Vice President, General Manager General Manager
Executive Management Vulcraft Group Vulcraft of New York, Inc.
Executive Offices Fort Payne, Alabama Chemung, New York
Daniel R. DiMicco Jeff B. Carmean James W. Ronner
Director, President and General Manager Vice President, General Manager
Chief Executive Officer Building Systems Group Vulcraft Group
Swansea, South Carolina St. Joe, Indiana
Terry S. Lisenby
Chief Financial Officer, Treasurer David L. Chase R. Joseph Stratman
and Executive Vice President Vice President, General Manager Vice President, General Manager
Sheet Mill Group Nucor-Yamato Steel Company
Hamilton Lott, Jr. Hickman, Arkansas Blytheville, Arkansas
Executive Vice President
James R. Darsey Lynn E. Strock
D. Michael Parrish Vice President, General Manager Vice President, General Manager
Executive Vice President Bar Mill Group Vulcraft Group
Jewett, Texas Florence, South Carolina
Joseph A. Rutkowski
Executive Vice President Giffin F. Daughtridge G. Wayne Studebaker
General Manager General Manager
James M. Coblin Plate Mill Research and Development
Vice President, Human Resources Winton, North Carolina Norfolk, Nebraska
Elizabeth W. Bowers Jerry V. DeMars
General Manager of Taxes Vice President, General Manager
Fastener Division
Robert W. Johns St. Joe, Indiana
Director of Marketing,
Sheet Mill Group
Corporate and Stock Data
26
Executive Offices Stock Price and Dividends Paid:
2100 Rexford Road
Charlotte, North Carolina
28211 First Second Third Fourth
Phone 704/366-7000 Quarter Quarter Quarter Quarter
Fax 704/362-4208 --------------------------------------------------
2000
Stock Transfers Stock Price:
Dividend Disbursing High $56.44 $51.25 $39.75 $41.19
Dividend Reinvestment Low 45.06 33.00 29.94 29.50
Dividends Paid .13 .15 .15 .15
American Stock Transfer --------------------------------------------------
& Trust Company 1999
40 Wall Street Stock Price:
New York, New York 10005 High $50.25 $61.81 $53.00 $57.44
Phone 800/937-5449 Low 41.63 44.56 44.25 40.00
Fax 718/236-2641 Dividends Paid .12 .13 .13 .13
--------------------------------------------------
Annual Meeting
Place - 10-K and 11-Year Data
The Park Hotel Copies of (1) Form 10-K for 2000 filed with
2200 Rexford Road the Securities and Exchange Commission, and
Morrison A & B (2) various financial and statistical data
Charlotte, North Carolina for the years 1990 to 2000, are available on
request.
Time/Date -
10:00 A.M., Wednesday Internet Data
May 9, 2001 Various data is available on www.nucor.com.
Stock Listing
New York Stock Exchange
Trading Symbol - NUE