Exhibit 99.1
PRESS RELEASE
April 20, 2005 [STEEL DYNAMICS LOGO]
6714 Pointe Inverness Way, Suite 200
Fort Wayne, IN 46804-7932
260.459.3553 Phone
260.969.3590 Fax
www.steeldynamics.com
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STEEL DYNAMICS REPORTS STRONG YEAR-OVER-YEAR
FIRST QUARTER RESULTS
FORT WAYNE, INDIANA, April 20, 2005- Steel Dynamics, Inc. (NASDAQ: STLD) today
announced first quarter 2005 earnings of $61 million, or $1.12 per diluted
share, versus $32 million or $0.58 per diluted share in the first quarter of
2004 and $82 million, or $1.47 per diluted share, in the fourth quarter.
Earnings were up 90 percent from the first quarter of 2004 and were higher than
any prior year's first quarter. Net sales for the first quarter were $571
million, an increase of 49 percent from the first quarter of 2004, but 5 percent
lower than the fourth quarter of 2004. Cash flow from operations remained
strong, increasing to $55 million, compared to $11 million in the first quarter
of 2004 and $41 million in the fourth quarter of 2004.
"Steel Dynamics had a good first quarter with consolidated shipments up slightly
from the fourth quarter," said Keith Busse, President and CEO of Steel Dynamics.
"Because market demand for flat-rolled steel remained weaker than initially
expected, flat-roll selling prices declined from fourth-quarter levels. Our
average consolidated selling price decreased 6 percent, from $710 in the fourth
quarter to $669 in the first quarter, principally due to lower flat-rolled
pricing."
"Our average steel scrap and scrap substitute costs declined by $16 per ton from
the fourth quarter, but not sufficient to offset lower selling prices, resulting
in narrower profit margins. On the bright side, we bought a significant amount
of steel scrap in the first quarter as scrap prices declined, potentially
allowing for stronger margins in the second quarter as we consume that material.
In the second quarter we anticipate that pricing will be flat, although we
expect increased shipping volumes in our bar and structural operating units. We
expect second-quarter results to be substantially stronger than the first
quarter as a result of lower steel scrap costs," said Busse.
First quarter consolidated shipments of 853,000 tons were 7 percent higher than
the first quarter of 2004 and 1 percent higher than the fourth quarter of 2004.
Shipments of flat-rolled and bar steel declined modestly from the fourth
quarter, while structural steel and joist-and-deck shipments increased.
Operating highlights for the first quarter included the start-up of joist
fabrication and shipments from the New Millennium plant in Lake City, Florida,
where new crews are quickly ramping up production. The Structural & Rail mill
continued its shipments of industrial-grade rail and commissioned additional
structural products in the quarter. The Iron Dynamics Division continued
pig-iron production at a rate of about 20,000 tonnes per month. Temporary
equipment problems encountered in February at the Bar Products mill and the
Flat-Roll mill were quickly resolved, and did not significantly reduce the
mills' overall output for the quarter. Currently, all our facilities are in
excellent position to take advantage of the expected seasonal increase in demand
in the steel markets.
During the quarter the Company repurchased an additional 2.1 million shares of
its common stock, thus completing the repurchase of the entire 5 million shares
authorized by the Board of Directors when it approved the Company's 2004 Share
Repurchase Program on October 26, 2004. Effective April 19, 2005, however, the
Board granted approval to repurchase an additional 2.5 million shares under its
Share Repurchase Program.
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CONFERENCE CALL AND WEBCAST
On Thursday, April 21, 2005 at 11:00 am Eastern, Steel Dynamics will host a
conference call in which Steel Dynamics' management will discuss first quarter
2005 results. You are invited to listen to the live audio broadcast of the
conference call over the Internet, accessible from Steel Dynamics' Web site:
WWW.STEELDYNAMICS.COM
Dial-in information is available on our Web site. No telephone replay will be
available. An audio replay of the Webcast will be available from the SDI Web
site.
Contact: Fred Warner, Investor Relations Manager, (260) 969-3564 or
fax (260) 969-3590
F.WARNER@STEELDYNAMICS.COM
Forward Looking Statements
This press release contains some predictive statements about future events,
including statements related to conditions in the steel marketplace, Steel
Dynamics' revenue growth, costs of raw materials, future profitability, and the
operation of new or existing facilities. These statements 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.
Such predictive statements are not guarantees of future performance, and actual
results could differ materially from our current expectations.
We refer you to SDI's detailed explanation of the many 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 and in other reports which we from
time to time file with the Securities and Exchange Commission, available
publicly on the SEC Web site, www.sec.gov, and on the Steel Dynamics Web site,
www.steeldynamics.com
STEEL DYNAMICS, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
(IN THOUSANDS, EXCEPT PER SHARE DATA)
THREE MONTHS ENDED
MARCH 31,
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2005 2004
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NET SALES $ 570,706 $ 384,145
Costs of goods sold 441,929 307,670
Selling, general and administrative expenses 22,454 17,935
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OPERATING INCOME 106,323 58,540
Interest expense 8,077 9,504
Other (income) expense, net (578) (2,103)
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INCOME BEFORE INCOME TAXES 98,824 51,139
Income taxes 38,047 19,177
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NET INCOME $ 60,777 $ 31,962
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BASIC EARNINGS PER SHARE $ 1.27 $ .65
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Weighted average common shares outstanding 47,703 48,947
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DILUTED EARNINGS PER SHARE,
including effect of assumed conversions $ 1.12 $ .58
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Weighted average common shares
and share equivalents outstanding 54,828 56,212
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DIVIDENDS DECLARED PER SHARE $ .10 $ . -
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STEEL DYNAMICS, INC.
UNAUDITED SUPPLEMENTAL OPERATING INFORMATION
THREE MONTHS ENDED
MARCH 31,
-------------------------
2005 2004
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SHIPMENTS AND PRODUCTION DATA (TONS)
Shipments
Steel Operations* 845,718 787,478
Other Operations** 97,241 92,888
Intercompany (89,816) (81,738)
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Consolidated shipments 853,143 798,628
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Steel Operations* production 882,311 809,975
Average consolidated selling price per ton $ 669 $ 481
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* Steel Operations include the company's Flat Roll Division, Structural and Rail
Division and Bar Products Division.
** Other Operations include New Millennium Building Systems, Paragon Steel
Trading and Iron Dynamics.
STEEL DYNAMICS, INC.
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
MARCH 31, DECEMBER 31,
2005 2004
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(UNAUDITED)
ASSETS
CURRENT ASSETS
Cash and equivalents $ 3,747 $ 16,334
Accounts receivable 267,793 253,861
Inventories 395,635 381,488
Deferred income taxes 7,400 6,856
Other current assets 7,726 18,980
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TOTAL CURRENT ASSETS 682,301 677,519
PROPERTY, PLANT AND EQUIPMENT, NET 1,022,198 1,024,044
RESTRICTED CASH 1,589 989
OTHER ASSETS 30,359 31,067
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TOTAL ASSETS $ 1,736,447 $ 1,733,619
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LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 152,530 $ 141,888
Accrued interest 3,157 8,796
Accrued expenses 47,322 75,750
Current portion of long-term debt 8,846 6,774
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TOTAL CURRENT LIABILITIES 211,855 233,208
LONG-TERM DEBT, including bond premium of $6,725 and $7,147
at March 31, 2005 and December 31, 2004, respectively 460,330 441,605
DEFERRED INCOME TAXES 222,792 209,215
MINORITY INTEREST 2,588 2,469
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Common stock 527 523
Treasury stock, at cost (160,841) (84,141)
Additional paid-in capital 402,865 390,505
Retained earnings 596,331 540,235
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TOTAL STOCKHOLDERS' EQUITY 838,882 847,122
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 1,736,447 $ 1,733,619
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STEEL DYNAMICS, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
THREE MONTHS ENDED
MARCH 31,
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2005 2004
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OPERATING ACTIVITIES
Net income $ 60,777 $ 31,962
Adjustments to reconcile net income to net cash
provided by operating activities
Depreciation and amortization 21,830 18,779
Deferred income taxes 13,033 11,668
Minority interest 118 649
Changes in certain assets and liabilities:
Accounts receivable (13,932) (38,573)
Inventories (14,147) (51,493)
Accounts payable 10,843 49,263
Other working capital (23,547) (11,590)
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Net cash provided by operating activities 54,975 10,665
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INVESTING ACTIVITIES
Purchase of property, plant and equipment (19,141) (23,905)
FINANCING ACTIVITIES
Issuance of long-term debt 61,308 29,939
Repayment of long-term debt (40,511) (33,659)
Issuance of common stock (net of expenses) and proceeds
and tax benefits from exercise of stock options 12,364 10,086
Purchase of treasury stock (76,700) (238)
Dividends paid (4,882) -
Debt issuance costs - (24)
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Net cash provided by (used in) financing activities (48,421) 6,104
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Decrease in cash and equivalents (12,587) (7,136)
Cash and equivalents at beginning of period 16,334 65,430
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Cash and equivalents at end of period $ 3,747 $ 58,294
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