NUE - Earnings call transcript Q1 2022

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Operator

Good day, everyone, and welcome to the Nucor Corporation First Quarter of 2022 Earnings Call.

As a reminder, today's call is being recorded. Later, we will conduct a question-and-answer session and instructions will come at that time. Certain statements made during the conference will be forward-looking statements that involve risks and uncertainties. The words we expect, believe, anticipate and variations of such words and similar expressions are intended to identify those forward-looking statements, which are based on management's current expectations and information that is currently available.

are that reasonable affect future they be there their believes assurance no events Nucor based assumptions, on can accuracy. Although will not these Nucor's found about statements which and are information the the and XX-Qs, relating More SEC's on and risks subsequently filed may Nucor's in to be available latest website. XX-K uncertainties forward-looking of any as new as and Nucor date, The made this in this or either events forward-looking future them, conference not information, of obligation assume otherwise. statements a update result call speak only to does

For call opening Corporation. remarks Officer Topalian, turn and introductions, I Nucor would over Chief like to Please of Leon the go ahead. to Mr. Executive

Leon Topalian

Steve Good to afternoon, call new by first quarter welcome Officer, our our begin earnings Laxton. call. the to I'd introducing like Financial and Chief

raw announced has of Sharon, the retirement X the first company, you'll like we the thank During hearing has take and I'd Steve's began first Jim the of performance. future Also quarter we engineered opportunity Chief welcome construction family and and our Nucor from and and team, are also logistics; and bar, Murphy, Al and responsible Operating tremendous joining impact the for very including and for Doug sheet for retirement. in Dave with and And a as record responsible responsible Greg wife, performance, about first the had of CFO of materials years plate appointment responsible on the team us our his a his Steve our financial Needham, Development. commercial wish today the career minutes Nucor we President our be responsible and few to CFO. quarter, XXXX to bar spent another Query, XX is for our to services and Chad our XXXX. Rex the enterprise, for and Jim executive and fabrication; our He in best tubular products; Frias the years to responsible for in Last set his in role executive for Counsel; Nucor. of his members strategy; excited beating me, record for fabricated the business on Slate, Jim Steve to him Business Officer; Steve Vice start achieved products; General Behr, We're rebar Jellison, strong last quarter Sumoski, Dan off team. we as XXXX, and products. Nucor structural Frias in of for the in year, MaryEmily call upcoming safety responsible the team safety Utermark,

our continue achieving across our set to another from record divisions toward excellent work team's customers. to as commitment becoming goal company. strong XXXX. together, the world's our and in see of our performance safest steel progress meet I'm safety demand of teams proud Team, our We let's

chains of record invasion Turning volatility industry. quarter $X.XX. and impacted the was of nearly to of We share pronounced every with Ukraine commodity per supply earnings financial by marked performance. our quarter as results achieved The markets Russia's first

people of of our The and While the business coming images concern invasion. Ukraine. that the of on an is the Ukrainian to are showed upended sustainability the Ukraine-Russia is due out the industry, impact Ukraine disaster in The has conflict recent in who the and are are having heartbreaking X our endure certainly Russian unfolded resilience invasion and that much continue onset humanitarian suffering markets XXXX the our of and March model. of prayers significant pandemic with events and larger Ukraine to thoughts the

and Nucor us supply portfolio volatile extremely conditions the over of market the that product diversified several how to and our pandemic process production followed. proud thrive chain I'm past years. has X the flexible have Our unexpected disruptions helped in navigated team

of completing We investments of the strategic $X.X organic end the by on growth cusp in XXXX. billion are

$X.X investors We completed X in acquisitions the have quarters. billion $X.X our through to also strategic last approximately billion capital in and returned

under of that new surpass in which series performance new and now expect Our in quarter. remains growth second we record, with getting XXXX have record balance just again Nucor a levered, are XXXX. breakout beginning the sheet we're fresh initiatives quarterly delivered we And underway. organic to a

benefit in historically the and makes up that ability a business powerful current model. over seaborne adaptive to have Pig XX% markets and iron disruption Russia year. the navigate roughly for typical of overall to accounted Ukraine metallic team's Our the of supply supply. of pig highlight iron Nucor's Nucor's half

needs. and at suppliers. or this years purchases Russian all any without outset other could quality from we disrupting of supply we of to the effectively iron pig materials raw We raw ceased have customer our do material war, However, worked related the this the to immediately risks over because manage

the not source in began, we forward since from our conditions permit. to material with when war partnering suppliers have been we region Ukrainian able Ukraine While to the look

to pig of copper as footprint; network can reliable spread advantages this especially capabilities steel invest they in value the reduce and in production mills DRI high-quality to additional our to that scrap good producers its enabling to long-term our disruption, and meet Trinidad once brokerage iron environment; have its has to broad those proven Nucor's this carbon low help continue for requirements. the our DJJ further ability to including it that increase manage and utilizes particularly need several us our ensure again metallics, technologies arm that customers' in relationships globally; us have are We helpful Louisiana that through production are with numerous

market current conditions. to Turning

key to we across serve. robust We end-use continue see markets the demand

constrained and realized automotive Some and markets, despite being initial due to our and expectations. to year, as continue be averages chain key issues. automotive, below like we energy results their challenged supply well markets such Last outstanding

pricing challenges now let in supply automotive and growth for similar, production strong The demand constraints, a XXXX was quick energy first for And despite provide response specific some quarter of very relatively hydrocarbons. overall strong update me on tepid products despite initiatives. with continued

Steel in call, Coast, expands California sheet create chain the And the this in geographic During of our to grows and a family. discussed we the efficiencies Nucor's quarter, our our Verco reach West supply Industries. businesses investment stake last we've welcome CSI Industries. the of first million with to in downstream $XXX market our Nucor products majority our as We Hannibal completed on acquisition sheet portfolio value-added including and region, teammates

line expand plans XXX,XXX of construction-grade thin tons The sheet per our also tons capacity Crawfordsville's Earlier of this month, to have North a capacity micro build in an announced and we line slab first modernize Indiana These construction-grade galvanizing per to Indiana was will will galva mill, while enhance mill in pioneering We casting. line. prepaint sheet year, line our of continuous to Crawfordsville, plans product our XXX,XXX EAF the projects construction a mill by prepaint ability announced adding capabilities the annual and have will competitively serve third in year. Lexington, the market. Crawfordsville regional rebar continuous Carolina.

great down along completed to site the in supplies Atlanta. is to Southeast. has and real allowing the really efficiently commissioned state spending, our our We infrastructure success opportunity coiler our a Population Gallatin, Carolina. Lexington and transportation growing to project modernization rebar region to us The creating will commissioning at and with Washington deliver EAF second and and LMF. to fast-growing our rebar With rebar coming in customers The increasing We're of Florida, there and jobs abundant team during this growth to saw weeks. the and and scrap excited Missouri had have region, supply in home in be be Mid-Atlantic demand. North expansion corridors, micro new regard presence in and between the the the is mills caster federal with near

Gallatin's in Gallatin ton capabilities Following shear. million approximately we'll X to June and have By all mill We hot Gallatin's in crop that, and will roughing QX, of currently able a per X-day added produce tons million at capacity June, XXXX. year be anticipate rate. to of online. outage commission the By capacities shipping early should new X.X be mill

Our from for to receive we provide. team products recognition customers our the continues high-quality

year to Year fourth this receive the steelmaker For Nucor in received of EES remain We Supplier row, the GM Award. a award. only the has

customers example to our for this you serve focus proud of and steel. other X our is sustainability. on demanding In lower-COX-intensity one are automotive Nucor an These example is for just team, the is them To GM applications supplying investments first help products. recognition our Econiq of receiving our and listen of Award extremely should demonstrate for work with be how sustainability Overdrive running. products, goals. achieve received our addition, iconic we it with these of them and GM's customer awards also customers Nucor their to to making years our benefits we receive to

gas to look emissions just are continue greenhouse global average for further emissions. to X/X the reduce our we ways for our steel of industry, While the

We to And investment capacity. of be technology month, these nuclear NuScale, purchase reactor. sources, the that energy efforts reductions developer carbon achieve wind earlier projects we power announced requires power. solar reliability. of this grid the clean United XXX power X called while which to grid baseload power generation modular of for of have This the why investment complements leading effective sources in small supported power is energy part agreements development in and a signing both of by megawatts and renewable new solution new renewable And NuScale intermittent we an the roughly help electric a must develop both maintaining nuclear States believe and

team by expanding X,XXX ITC on XXXX Nucor delivering market corrosion-resistant that and front, for record-breaking a our of approximately Nucor flat industry in consumers cost quality trade cold-rolled opportunities of results exciting trade will steel subsidies to unfairly efforts effective by On We Nucor's including operations sunset place. These steel law team's and noneconomic stability are take is safety over world-class orders or where to every our global of our are steelmaking steel. orders vigorously performance than billion and for reviews advantages exceptional area the investments Nucor imports trade X-year remain care profitability. value as in not focus the an work period. These year customers, U.S. government compete and teammates marketplace concern. by incredibly and by and essential is and they a more particularly factors. our jobs important and business, driven I'm products, in performance, proud that view are investing advocacy the conducting real of to remain The to traded our in determined $X.X this XXXX on shareholders. in other component to are of winners enforcement the sustainable ensure create key Nucor

every with leaders team grateful the to the and world. for value order, customers place in are in Nucor cleanest by We steel our solutions and customer sustainable most being exceptional we trust delivering strive the the offer and

indicators forward-looking we and favorable, earnings key year for strong both and another expect in Our XXXX cash remain generation.

Laxton about Steve performance. provide Steve? Now will our first details quarter more

Stephen Laxton

my work in Thanks, outstanding Leon. thanking by teammates the I first want start their all Nucor to out for of quarter.

with honored and working privileged of As over my and what's they've me as CFO. my team inspire to in together. done by years to Nucor, be this women you the I'm achieved working alongside continue new men role XX And

month As diluted a the businesses a a share. the XXXX, to earnings of first earnings year number unrivaled an quarter the on results our last quarter. exceeded record XXXX of and bar and The Nucor's fourth of our materials of impacted first achieved raw highly quarter. structure, also mills, prior the per guidance per volumes our display that variable These strong provide record, and and businesses, earnings doubling than yet achieved set Better-than-forecast Leon XXXX in of our growth building merchant cost mentioned, Comparing the quarter coupled our weaker rebar businesses. was product $X.XX again systems quarter the and with pricing array March including across of offset value for to business. first share range diversity, sheet mills, of $X.XX of to adaptive new quarter broad first of sheet first in $X.XX of more $X.XX were establishes

net complement to diverse year. construction to tubular the demand fasteners, for fully over Products of continued remains sectors our and and metal of and deck, Products quarterly quarterly the wider It's $X and expect the panels increased attractive confluence as income. profits finished to We Steel cold provide in consisted capabilities returns the quarter as in noting to net sit economy. or Steel to to ever. nonresidential fantastic growth developed Capital at earnings XX most deck, of $XXX billion quarter segment during into our bars, XX% million These totaled made dividends million a of segment of XXXX, portfolio provide from translated strong incremental we've and under new flows or cash operations, Our a approximately of was buildings metal critical Nucor they the Strong Nucor's set set cash portion flows almost a second a ability the strong, systems. years, $XXX X racking to million expenditures insulated They well the in totaling about million returns buildings, the which products. last highest segment that shareholders. of a redeployed the record the also in $X.X Financial X intentionally cash earnings $XXX commitment acquisitions last strength worth tubular $XX this solutions. quarterly expand positioned joist of in here $X.X period These repurchases metal margins additions for us over of via a million. ended amounted and last strong billion our continue period shareholders. on to of billion. our market-leading EBITDA and Over These deliver to that XXXX to We create approximately and recently, from $XXX remains end-market joists, cash of XXXX shares. enabler time, core just share products, million make value include cash businesses results

$XXX the the includes Our have of revolving also quarter. rating cash company investments strongest short-term holdings issued $X.X to At of end undrawn billion first in month. notes $X.XX above just August XXXX. the billion. at $X.X X% and bonds September redeem our $X.X our proceeds including with $XXX X.X%. of of our American million sector. This issued the X/X% first in notes. facility, the we of due are other these are million will rate to be just notes XX, which was of X% this On XXXX. steel quarter, credit X.X%, half coupon used notice X all the last our Half to close coupon we cash, approximately XX-year under matures XX-year a and Nucor's the current of with North notes credit debt, rate in totaled liquidity Total continues the unsecured a and portion, These of notes March billion million November redeem billion due restricted of includes a $XXX long-term

first framework Nucor this the Excluding capital on being percentage allocation. And clear a like total of of the and at the spend approximately September, the debt debt to XX% I'd X minute remains maturing in unchanged. a capital capital as redeemed was quarter. or has now close a allocation debt month gross that

to is strength. and deployment capabilities of additional our priority Our through for capital first existing create that positions leverages value

and maintain done something years straight we've without for XX a fail. to healthy is priority second grow dividend, Our regular

upside committed our returns Lastly, sharing directly with to shareholders. we remain

Today, strategy. realizing target and going that meaningful a minimum priority our and our our directly long-term on a our further of history shareholders. of shareholders result of Specifically, via the execution foundation dividends business share model of repurchases. for consistent company's future cash present laying how earnings creation. execution we we is we The growth team's are long successes our a of to disciplined of first for over today create we The focus value value are are XX%

of summary activities. Let key me highlight here of some the a

approximately XX have projects generate past significant capital few remain later We normal of $XXX least product $X.X Leon competitive we Nucor's EBITDA portfolio. confident that Brandenburg these its billion over of position across will on annual during the million year, this with mentioned, years XX As enhance conditions. deployed that the completion market will of at projects

During XXXX far we stronger them. such better as 'XX, expect environments, from and results can

we XXXX. noted spending, of fourth our approximately during million earnings quarter capital accounting X that $XXX projects, recall in generated billion about completed $X during may call, You for that EBITDA

significant further Virginia for capital Gallatin coming our Crawfordsville at our another Looking planned rebar billion North West and capabilities micro roughly Carolina mill, $X.X sheet mill. and our years, on ahead, the have spending enhanced projects incremental of we including mills,

We again, generate able that of be expect fully Nucor, will $XXX these conditions. annually during facilities normal incremental to up, million ramped once for around EBITDA market

In growth in addition organic M&A engage strategic activity. to our opportunities, continues Nucor and to targeted

As as Nucor further create tenure Leon acquisitions these and Collectively, investments mentioned, $X.X differentiate future about via value. his we've billion during in and powerful a sustainability shareholder catalyst for capital deployed CEO.

years billion completed on rate and today. opportunities future We'll value than already slide We grow these the substantial in nucor.com about $X.X shareholder expect short We're the in of a more to to and investments. to later deck posted from page these ahead. IR have Nucor's add summarizing EBITDA run underway excited years

As our Leon mentioned, key demand across remains strong end-use markets.

profitable of the the quarter that XXXX. will expect previous in second fourth set of the We be quarter quarter Nucor's history, the XXXX record surpassing in most

will I earnings Steel driven increased segment earlier. profitability the by be quarter Products Second in mentioned

In we earnings for your primarily Thank increased to due you increased raw interest Nucor's due expected prices in profitability are of strengthen is selling addition, to to the relatively and in sheet materials. segment the now take plate higher for profits materials our second raw are quarter Mills to our ready generate segment questions. expected company. Steel Operator, to mills.

Operator

We'll Sachs. Chieng take first our Goldman Instructions]. Emily question from with [Operator

Emily Chieng

It to was maybe maybe did for around just in the shipments a sheet in that the Thank My that sort sequentially. mill and steel first note, today. noted Is first declines the of function in rest see the to driving operating just I market Any plate did of XX%. is looked same lower there would fall year a -- that's quarter. some modestly as on the you volumes for progress? expectations of update we that that question higher denominator? particularly rates then And end and note were that we like

Leon Topalian

you in ones, for QX, company in we of here it questions. or and two. of let all end jump But Mexico year. the begin the end please might the XXXX, backdrop QX in of the at If and was with as saw me Query, I'll into time. thank sort move about really Emily, got we saw a all a of of same our the imports year of sheet. and Two, groups or kind full. the culminating saw for we product the X -- kind third in, from Sheet, I from of distributors remind begin in Rex EVP factors me. second forget an But with caught coming And XXXX what the in historic our mills One largely And up three, of back really and obviously point Canada.

some And pricing piece large The little we sheet there. going so on weakening softening as business enter and our bit we of the with XXXX, down is side, saw contract-based. a some sheet

a the few put also And weeks spot we that that ensure when I'd came. to so not pivot would a believe support Emily, time didn't our in we also had with on just you, maintenance, different focus -- ready strategic came share that that there volumes that. the pivot obviously, out at that tons market deliberate later. outages able when decisions took decision But really to we and to some were at we facilities And made some go to

talk is being a in plate, incredibly you utilization and shared Steve why of Further, we as incredibly again, to position. and QX see some as -- in And QX, underlying result, didn't the be profitability saw just reason we see part how as sheet we resilient. tons. has continues with the chase an record our through. some. we earlier, our And so be of we're commercially it But dropped a we because you demand we as for about approach strong to QX expect moving And

Al in on Rex, tons, quickly. very, early into comment plate. March, very side? to that higher-priced to then February a you'd sheet pivot coming that going on those into And maybe add flow you're Behr, again, through anything the two So or see QX

Rex Query

thanks the can I covered, Emily, only question. well items. for a And few add

what did Leon late first happened was think quarter. progress. what the those we setting early being into basically, we conditions I as stage saw we the corrected the well of as entered And in year

positioned and To about second the remainder So for Underlying going increased, was strong. mentioned, to the utilization, the expectations for able with we're the for economy and the have be that that the a the year. to of strong. tie work that we've outages utilization. segments maintenance I next in strength. up in the so Backlog I'll see are do very substantial and we XX% We to have well you ourselves part asked year, with had the increase very remainder you in for the ramp that months, our see of can bookings the we has speak in occurred general been coming core that that. demand

Leon Topalian

Rex. you, Al? Thank

Allen Behr

we add There strong I fabricators Yes, the in were where place. noteworthy When end couple -- was strength. say, And detail. Leon heavy One just remain several at levels. covered, similar, the equipment I'll where the its actually would takes couple that of story I would their we consumption very Emily. construction side the on strong. consumptive there market, a pull we demand comments at areas The at strength. look plates, level, user the a is in look as noteworthy there. remained business, saw from in

higher expect time market higher on that an QX outage great at quarter today, in the distributor sit pricing, they position likely we improving improving to we as some our significantly we the inventories that did As not utilization those lower, and the adjustments to weakness to activity. inventory do frankly, the operations run where at margins. tons. preventative opportunity and on at to the the position market that, a we look some chase spot maintenance their improving see capitalize and created chose We through to some profitable a a would tons and and some conditions, work in focus long-term get kept use And level, in they take as

thanks So the question. for

Emily Chieng

a Great. lot sense. That makes of

Leon Topalian

it, Emily? covered that Is

Emily Chieng

just that is Louisiana. that have follow-up, No, should around about the earlier. provided around very utilization And of comments that got you've I the a component. raw two mix. production? it's continue DRI the material was Yes. And My rates think and I question a opportunity appreciate clear. appreciate of I do we there the those How and assets increase couple Trinidad what's in to you the assets? to

Leon Topalian

beat materials invasion about chain of the quite that be happened, to now or stopped very Jellison, I'll from on raw a materials, sources after Yes. crisis and Doug in the Joseph's we comment. our Russia they've for level couldn't are the frankly, team Because the have business our more nothing existing of high David Nucor's Doug supply going being and miss to us responded. EVP We think humanitarian pivot. day delivery buying customers raw pivoted model inconsequential has that really not going from we around ask I and/or first. enabled when proud right comparison. would maybe to taken that's a said, really just again, are provide of to team All outside and pales Ukraine, flexibility them. I of quickly entire how materials quality. The disruptions other immediately And in world. the it into

forward? moving maybe And see and touch so, you just DRI on Doug, the that side how

Douglas Jellison

very both rates. Leon. well, reliability facilities world-class The DRI high are our -- DRI running Yes. of Thanks, very,

of as the little those the expect production we're balance the went dip of down seeing near bit and now full run first bringing a quarter, of in and back to capacity up would year. in the are We part the

Leon Topalian

can internally on you where products? we why some the the flexibility touch Doug, of don't demand, shift

Douglas Jellison

I'll of things a touch on. Yes, number

So of run mix about adjusted mix, about our historically, we pig we're iron. Leon running iron the in is opening our as comments. pig that. XX% X% Today, mentioned We've in

XX% run scrap. We historically, our in also, sheet prime about business,

DRI, profile our the can gives in mix a us into there. So mills sheet different going in very you see our

from done read investment job signs to mentioned, an and doesn't That able market Leon literally team outstanding understanding turning the the of being in has overnight. just As and the quickly. of really of training happen happens And around the developing team overnight. things react and and that years

Operator

our from Alba take Stanley. De with question We'll next Morgan Carlos

Carlos De Alba

-- you scrap follow-up So scrap, you're see that mix. on else the If you the And the component there? maybe what do around XX% prime just pig how shredded right now What metallic iron, rest? do of a X% how the And there can more how What running complement the us side, dealing on the on tell front, natural front? on broadly, forward? you expect with we pressures gas? the can then cost labor are on on cost energy side, you the going

Leon Topalian

well and material, doing let to low switch the Well, incredibly other Okay. our that DRI some do continue to technology we raw Nucor use about We're color me lot or the opportunity into and at of the products copper us gives a sustainability to talk as up, maybe Carlos, mix, base. ability then, -- to with you between prime fleet. rationalize also trade. Doug, standpoint looking have us that maybe things COX we internally bringing and the latter the move from a the in externally start on supply as an how but really flexible A, give across It ourselves as

I think the part second was... your of question

Stephen Laxton

is Yes. Carlos, this Steve.

the asking you think inflation You're and our mills, cost. is Nucor, of metallic that about is XX% inside really. roughly demand. typically And pressure highly And of steel with cost the about correlated when

bit for any of Nucor, inflation but or variable of when to not not steelmaking energy general, major portion most of because electricity. it's sensitivity little then about rate move, that things a state it's in that highly under nature. And cost. indexes most of our have, tariff think particular, and you of least, to see that we varies in And from is energy that model is cost efficient, a going to cost large In case, comes from very remaining So state. for other the And different. kind of components, programs at our

for that. and on combined natural XX% direct typically and had necessarily to today, XX% XXXX. use strip of not number a a years. about program, there. expected of hedged use our We the the in is hedge that immediate Nucor gas. needs capabilities prices exposure we've we're of and expected hedge and On there's the are physical XXXX, prices. have XXXX because positioned with to, well for current That's already place produce gas, Those we So -- for active we program a about well extremely of All under those

see well that to So immune inflationary we're in are these but we're not positioned we pretty relatively pressures. to We manage freight changes. certainly areas, other through -- and

Leon Topalian

Thanks, anything raw you'd Steve. Doug, the on add materials?

Douglas Jellison

specific the Carlos, long-term the times just I shreds, more give change spread is and economics, for with more again increase optimum grades we're not But it this than daily, have producing for had we've don't the on presence comment copper have a low in a that low copper years, those it. weekly a really lot always it what on numbers of on, to number sense. we obsolete shred. there's makes one shred. where a into worked because all But in sense number cost which on shred. the worked depending We've And will and Yes, makes more, development now, copper And lot flexibility. our prime the a the but more only low the short-term, grades, right market, between in not. putting us

Carlos De Alba

order guys, is your still some from production maybe -- potentially the the just We rate see customers? What your hear continue sector pickup see When to you auto production They question. challenging. a conversations, And reducing run rates. you rates? are do when do are you Understood. in auto on another -- hearing

Leon Topalian

long I would you been the Look, for time. a question. tell a What business is, we've in again, fair

an very, invest strategy And is in long-term U.S., the inflation, for drivers know digital warehousing driving say us them resilient a the -- our investment see digital established not, of as one nonres, would needs. your their personally. relationships would Carlos, day in has what's the has space, recognizing that answer with construction, very to stations We with the again, We know in customers. immune though, have capacity Every rates. interest across every the capability. but impacts with specifically, the the To happening to for demand in We marketplace our it's mentioned, gas be question, I understatement. tell to to to not Steve sensational. you, been team we're But and

led daily. jobs so are those And being

of to again, piece of range, overall that obviously, come mix our ask of a record because many in to. far backlogs today. cases, because we're us is to percentage year. don't market about X General, a our area Nucor continues it's automotive X.X the backlogs, in that's, at X.X to the a and order X, gain so Nucor's we would been one there's huge but want slow as customers book closing that And point are out million back, some of It's piece those If as share go not million, tons

that But area one that it double overall, in a that's pandemic. again, the and the expect And the of and counts remains robust. serve, underlying the is slower recovery demand years. that probably much have the while opportunity. markets We moving been life out to But And some some continues coming the we it's rig signs incredibly energy end side. up you're really on to seeing of somewhat,

Operator

We'll take our next Tanners with question Wolfe Research. from Timna

Timna Tanners

unprecedented months just So of volatility. like way past unpack because of cost dramatically, I'm couple me to up for amounts. fell seen it's scrap hot-rolled it's the and trying Nucor have gone have then doubled impacted hard unprecedented for the contemplate to prices

you seeing us your I'm bit to the not second into us quarter? to how just of talk to sequentially to QX QX the have about, a terms so numbers? Can And mix of about contract little of think can for those you the are you that? about And you and trying lag scraps lower a some the in pricing, think if prices remind

Leon Topalian

jump I'll our to add on Yes. in side. and Maybe But Timna, and first, the on Doug, rate group. in raw the then Rex that XX% if typically, on materials contract we're want sheet you there's anything side, sheet

sheet your The rate entered XXXX, did anything softening. in have product groups. years. through again, point, So that's has of 'XX, I've demand the been, we highest in we any my as XX seen our To was see unlike we some contract

then in the we buys do in the other we So about early coil to thinking softening and look some QX, of at Allen between really go seeing approach how the to delta not just or going pricing, where high. now tons. part serve come how hot-rolled out also was and equalized QX just quarter, early U.S. really the you we're spot look that which we late saw, this market, bringing if on And market tons to into our the drove market the looked A, balance and be played but to of of didn't was some again, We in perspective 'XX. that world the impacted. want moving profitability to our at decisions maintain wanted recovered share, U.S. and didn't the the market Again, rest share, more way have and simply as as both And we made too we as chase their Rex that forward. we import

QX instead Nucor recovery. been we've stated to looked of going going been see quick And order we again, happen, book how And why with of times sheet going line is very the because the bottom Nucor. and years you're a to And that into believe in So quickly has move the that's you, pricing recovery largely be is conversations in months. again, a of to there's or of over profitability. weeks to lag going that's through And again, going answer too your that, as question, long. and the we way through to record already to the increase is

ton. breakdown The other per of QX at, EBITDA is thing look our in you

going for our reflect value. I competition, against through to that's Rex, ton, we per line side? add think flows anything the that and on bottom very sheet maximize our EBITDA shareholders. our you'd to And again, Our strongly

Rex Query

on going such through premise see the a clear and move possibly What of of and had protracted further you're majority then that we decrease, your rebound very Timna, weeks matter extend for a out stated, would seen can months. you versus slower the quick that see in a recovery. if to that decrease on your tell you, But get very quickly, question. Leon I as we

that something that's a our mechanisms The other of the monthly time versus vast towards is longer contracts tell are majority would you frame. thing I geared

decrease So quarterly. we push through be that going again, the have pretty quick in amount the a quickly. would small to rebound, But that's with

say for in other didn't is, orders The I mentioned, that Leon as would pricing go that. take decrease, place, we saw we the spot the

opportunity the we matter now pricing higher do a the place we So have have weeks at spot of than have would ago. we as that market opportunity, tons to strengthening,

And it going bolster quicker. that's the kick even to so actually help and price up

So through -- this. see but premise, we tempered that's the being I understand it we the how by manage

Timna Tanners

that's And helpful. monthly... That's a Okay.

Douglas Jellison

a Doug. and is prices other leveraging have a we're we've One bit is to this that reaction is different integration, against raw operations the tighter and in our commercial scrap from tie than moving little is swings. quicker other Timna, we how time vertical seen thing materials. much much much, And

building stuff, Rex what this on shorter one. with be lag So we has and that said expect to

Leon Topalian

so and that's and scrap reflecting high, the are are Timna, what when And prices line. point, that's steel last really years is in seeing decades And today, as seen throughout prices. again, the you're bottom we've

Timna Tanners

X.X% strategy, the fell from Just like don't that, mentioned strong fall, could, ramp in I correct and mind. like but I despite I'm only answer in trying have if strong, an They're just withholding But if first I your half? question. where, is prices demand And to -- if to it everything seasonally, tons? understand And Nucor sheet. about trying I Gallatin Or environment but I up were a you demand And misunderstood, products. understand, in demand? to XX% is me. is from quarter, Emily's prices square the commercial second you you in it construction If And more bar heard volumes follow-up, the the year-over-year do was know you. how slips up Got weak you. to

Leon Topalian

it off Demand in we in QX softening was No, demand. as Yes. saw market. definitely the definitely sheet dropped a

saw same it was Again, dropping. was X or the pricing yes, of So environment we not 'XX at in all. QX

that was would the we be? to caught many maintenance as outages not think earlier, how how a great for delayed in our tons. chase and it And Nucor some protractive, what on in And that there wondering up. to pointed out capitalize the I market, sheet long, again, get of time mills was

very And do again, do our didn't And that. so that. mindset deliberate we part to on a

nearly chain would was didn't the back gone is what time do as side aggressively going trying we the part in into of seen or to that half supply distribution was that the in as longer frame, of typically January into of piece market early and other the of side, distribution QX and by The -- as to years February market full, the have understand those they term enter QX.

and again, that flowing. are came I and pivot very think, tons quickly those back

going And sheet utilization going see plate rates think you're -- our you're so see increase to well, I in groups. significant I a both know to across and

Operator

with from Seth take next Paribas. question Rosenfeld We'll BNP our

Seth Rosenfeld

in million us ask I of bit quarter last think, tons can give schedule to Can color in were has can also guidance believe of and what what Gallatin, of a give ramp-up the Probably, ramp for us of outlook X.X prior color later sorts If 'XX volumes shipments if quarters? late then regard to tons. follow-up a to schedule looking bit you on you I XXXX, targeted, Brandenburg with you this in that remarks, guidance with prepared your a you for please. led anticipating and reduction subsequent XXX,XXX I 'XX and of on a in into there? versus

Leon Topalian

I'm to Gallatin detailed Yes. more Al to Great on questions. update Behr to Brandenburg. and Query a going Rex you turn it and give

Rex Query

with is sheet Seth, the group. Rex Query All this right.

we into were equipment by And delayed encountered in Gallatin, December the Regarding had outage challenges in frankly, some extended we a few which, demolition, January. we installed the unique as an months.

So short that's the answer.

in Leon of been fully with -- X, well, as Our matter be And proud of pieces remarks, all team the opening we'll mentioned responded what's there commissioned and of a equipment we'll the safely, operating. done. weeks, really weeks, in X

XXX,XXX majority to expect to half second to at So the market conditions, during subject the be really we quarter, year. running of the the going be that's tons, nameplate of during that third would and an capacity additional

Allen Behr

outstanding supply in do at on of year, our executing team in and on Brandenburg, through of they've Brandenburg and the through late On there issues, end the the continues Allen. chain remain is this they of job They've Seth, QX track start-up come COVID, to project. that an for XXXX. come

a don't In 'XX. of than with say, that's I expect to in meaningful other production terms of have those to you QX share number market-dependent. tons, I'd largely

year it. the determined So of typically, capacity. is how that that can rate run aim a end looks the we year sits first in on through point of to how market start-up, respond the the at we of X/X and for of by year the But where

Seth Rosenfeld

just you'd year. you if the volume this in us of margins update We and strength regards strength And terms, steel but remarks, your if please? and please, of prepared on touched seeing construction In question, into to for Can quarters you products. how you're then can, to quarters peers have expect develop, your heard the excellent beyond later market. separate with in QX, in really later from going you quick margins on a today of both not I that earlier discussing of QX year, the one a that and give the pricing backlog,

Leon Topalian

to ask Seth. Certainly, on Chad I'll that. Utermark Yes. comment

how a Chad, improving has on things again couldn't the been as And our provide more to done want backdrop, year. more expect spectacular. But they've head groups they you things and the as of they throughout little the they've I and we do be achieved. great products performance products? in proud of again, continued how detail And Just responded a what

Chad Utermark

Yes. Chad. Thanks, Leon. this is Seth,

QX, continue I would and solid, are in into overall activity strong, adjusted margins. very we mentioned, And and as very improving we As our quoting head backlogs with note, to seasonally see QX.

buildings, demand. a steel the steel would portfolio that us you remind I and gives portfolio, space with deck in a bullish it into tubing, good metal fab, got racking visibility of downstream joist XXXX conduit. new core Our on we've really steel businesses, rebar that now metal customers overwhelmingly piling, our panels, insulated pre-engineered are And and

being also a they're country. economy, centers, into green overall, about the I'm growth: as we amazed warehouses, and picture just the digitized demand like facilities well. the but strong. plants facilities at looks EV-related storage strength server They're creating And significant before, we're XXXX. built excited the the distribution We've this -- economy, manufacturing yes, head seeing for So of what across demand still plants we're mentioned manufacturing very as

So excited. yes, we're

Stephen Laxton

just this I to want Seth, Steve. on to Chad's is here. Yes. add comments

group our think a product the downstream offer segment, array of wide We one Nucor I meaningful in just be last million is of second in the the a solutions. on of quarter group in differentiators versus sense steel part products for of that's give you scale even real market And And stronger. Our that. our space. end a just portfolio. people will quarter, to And that our contributed we $XXX EBITDA, many over project that

So that's some a don't attribute real lever that folks portfolio positive a our have. of and

Operator

Woodworth caller last with Curt our take We'll Credit Suisse. from

Curtis Woodworth

segment -- follow little a of that the Products well. follow Just to up acquisitions Steel just wanted up business. in fair I done bit a amount on know wanted as you've to

guiding any on in the up spread wondering seems rate That's earnings when power side EBITDA you in long look the pretty of up if to at that to question. though first of that? of backlog more was fair? run give of imply XQ earnings So significantly it like guess, being the given potentially you business, And some Steel your would I do the Products XQ, got then compression product kind just the could even be my the in granularity terms and you the is long-term portfolio, business. you've feel I

Stephen Laxton

a Thank guidance that this time. in group and quarter. are Curt. strong. later the end the guide going for market We're to quantitative provide demand at say that across specific in EBITDA target much But is point board to you, We backlogs the Yes. we strong will not

ability again, to And to already company heard cash strong. upside in you've flow very ones benefits markets that terms when from responsive that generate think their are these I today. the us are businesses are of

nature ways. these many are variable the things that's and cost think in these the I highly of differentiated one that products groups -- of the So of

Rex Query

third in I pick rates is the will full we are the quarter. would swing, move just backlog again, and and second add that the -- typically, strong. as run projects up due into to seasonality, Construction

I'm So overall, of would up so different when rates in say I some. again, businesses many careful But have most general. run I we the see pick businesses, in our to of some expect

Leon Topalian

you longs. longs. very I'll provide And a Curt, mentioned quick comment on just

averaged If about over like the XX-year example, you decade. utilization think history, our last for mill, XX% beam probably the

entered XX%. in we over XXXX, that As increased

remain have again, leadership our beam our most that rebar drivers incredible incredible and returns longs we position for very structurals that and power. demand and strong, businesses that creates mill so generating And in those are And both earning market and in beams company. an of that

Curtis Woodworth

any M&A, Okay. further to deploy Products more investments, And let's or sorts get the potential more then other to pig with ways into Steel expect respect then you say, to captive to capital of continue evaluating increased segment? And are scrap? you DRI iron would prime

Leon Topalian

over to, quarter to capital. we again, XXXX Look, set record billion continue of first for ways record, that as the earnings, continually looking we're $X as in we set earnings deploy at

to earlier in his about we're is, reinvest that comments out going a framework ways. and capital in of do our laid first, Steve to As allocation it in philosophy, multitude growth, and

culture. statement grow core words: mission The our core beyond assets. those being live X is and core, Our the expand it's

will bunch like mill, whole talk plant, continue and expansion that expand and and bring racking, grow Curt, those piece, like continue Nucor And portfolio. shareholder the there's panel the we're Virginia bringing the Cornerstone that fire, on metal to our that opportunities beyond value or I and Industries the maximize you're Then of can't yes, about. a the insulated to on So to to excited like the look irons be at us continue like Crawfordsville. to of we're continue micro then going going things see really to things great for to diversify the the Hannibal in about, West acquisition building do

Operator

Leon back session. this to like and for this time, At today's concludes turn I'd Ladies remarks. to Topalian closing gentlemen, or question-and-answer any the conference additional

Leon Topalian

you. Thank

customers, health the delivering of the we all your and most XX,XXX safety, for team our with Nucor family. our our every As conclude you Nucor important up for today, well-being continued value, on men focus Thank just who in team call and To that order. women and want the the make I place the thank thank you. you trust to

the and Nucor, And interest We well investment Our for the our to today the that build place finally, to trust valuable to in is steward you returns. great for in capital. your into you strategy well, maximizing your with that shareholders, Thank serve you to a your thank future. shareholder you and look us day. capabilities have

Operator

concludes and We Ladies gentlemen, this today's conference. your appreciate participation.

You disconnect. may now

Nucor (NUE) 21 Apr 222022 Q1 Earnings call transcript