Nucor Reports Results for the Third Quarter of 2022

CHARLOTTE, N.C., Oct. 20, 2022 /PRNewswire/ -- Nucor Corporation (NYSE: NUE) today announced quarterly consolidated net earnings of $1.69 billion, or $6.50 per diluted share, for the third quarter of 2022. By comparison, Nucor reported consolidated net earnings of $2.56 billion, or $9.67 per diluted share, for the second quarter of 2022 and $2.13 billion, or $7.28 per diluted share, for the third quarter of 2021.  

In the first nine months of 2022, Nucor reported consolidated net earnings of $6.35 billion, or $23.85 per diluted share, compared with consolidated net earnings of $4.58 billion, or $15.34 per diluted share, in the first nine months of 2021.

"Nucor has already achieved a record-breaking year for earnings per share through the first nine months of 2022 and we continue to believe that we will set a new record for full-year earnings in 2022.  Additionally, Nucor set benchmarks with the Safest year in our history in both 2020 and 2021 and we are on track to have the Safest year in history in 2022.  While economic uncertainty and inflation continue to put pressure across a myriad of sectors in the U.S., we believe the medium- and long-term outlook and fundamentals in our industry remain positive," said Leon Topalian, Nucor's Chair, President and Chief Executive Officer.  "We believe our growth investments and acquisitions continue to position Nucor to meet and exceed our customers' and shareholders' expectations today and well into the future."

Selected Segment Data
Earnings before income taxes and noncontrolling interests by segment for the third quarter and first nine months of 2022 and 2021 were as follows (in thousands):










Three Months (13 Weeks) Ended



Nine Months (39 Weeks) Ended




Oct. 1, 2022



Oct. 2, 2021



Oct. 1, 2022



Oct. 2, 2021


Steel mills


$

1,287,855



$

3,116,539



$

6,682,432



$

6,606,320


Steel products



1,196,845




368,595




3,011,644




839,737


Raw materials



279,189




161,870




638,640




505,248


Corporate/eliminations



(440,967)




(777,897)




(1,621,277)




(1,758,204)




$

2,322,922



$

2,869,107



$

8,711,439



$

6,193,101


Financial Review
Nucor's consolidated net sales decreased 11% to $10.50 billion in the third quarter of 2022 compared with $11.79 billion in the second quarter of 2022 and increased 2% compared with $10.31 billion in the third quarter of 2021. Average sales price per ton in the third quarter of 2022 decreased 3% compared with the second quarter of 2022 and increased 14% compared with the third quarter of 2021. A total of 6,415,000 tons were shipped to outside customers in the third quarter of 2022, an 8% decrease from the second quarter of 2022 and an 11% decrease from the third quarter of 2021. Total steel mill shipments in the third quarter of 2022 decreased 9% as compared to the second quarter of 2022 and decreased 10% as compared to the third quarter of 2021. Steel mill shipments to internal customers represented 22% of total steel mill shipments in the third quarter of 2022, compared with 22% in the second quarter of 2022 and 21% in the third quarter of 2021. Downstream steel product shipments to outside customers in the third quarter of 2022 decreased 2% from the second quarter of 2022 and decreased 1% compared to the third quarter of 2021.

In the first nine months of 2022, Nucor's consolidated net sales of $32.79 billion were an increase of 26% compared with consolidated net sales of $26.12 billion reported in the first nine months of 2021. Total tons shipped to outside customers in the first nine months of 2022 were 19,786,000, a decrease of 9% from the first nine months of 2021, while the average sales price per ton in the first nine months of 2022 increased 39% from the first nine months of 2021.

The average scrap and scrap substitute cost per gross ton used in the third quarter of 2022 was $502, a 6% decrease compared to $534 in the second quarter of 2022 and a 2% decrease compared to $511 in the third quarter of 2021. The average scrap and scrap substitute cost per gross ton used in the first nine months of 2022 was $511, a 12% increase compared to $457 in the first nine months of 2021.

Pre-operating and start-up costs related to the Company's growth projects were approximately $52 million, or $0.15 per diluted share, in the third quarter of 2022, compared with approximately $60 million, or $0.17 per diluted share, in the second quarter of 2022 and approximately $36 million, or $0.09 per diluted share, in the third quarter of 2021.

In the first nine months of 2022, pre-operating and start-up costs related to the Company's growth projects were approximately $174 million, or $0.50 per diluted share, compared with approximately $76 million, or $0.19 per diluted share, in the first nine months of 2021.

Overall operating rates at the Company's steel mills decreased to 77% in the third quarter of 2022 as compared to 85% in the second quarter of 2022 and 96% in the third quarter of 2021. Operating rates in the first nine months of 2022 decreased to 80% as compared to 96% in the first nine months of 2021.

Financial Strength
At the end of the third quarter of 2022, we had $3.51 billion in cash and cash equivalents, short-term investments and restricted cash and cash equivalents on hand. The Company's $1.75 billion revolving credit facility remains undrawn and does not expire until November 2026Nucor continues to have the strongest credit rating in the North American steel sector (Baa1/A-) with stable outlooks at both Moody's and Standard & Poor's.

Commitment to Returning Capital to Stockholders
During the third quarter of 2022, Nucor repurchased approximately 5.3 million shares of its common stock at an average price of $122.24 per share (approximately 17.5 million shares year-to-date at an average price of $134.99 per share). As of October 1, 2022, Nucor had approximately 257,000,000 shares outstanding and approximately $1.49 billion remaining for repurchases under its existing authorized share repurchase program. This share repurchase authorization is discretionary and has no scheduled expiration date.

On September 15, 2022, Nucor's board of directors declared a cash dividend of $0.50 per share. This cash dividend is payable on November 10, 2022 to stockholders of record as of September 30, 2022 and is Nucor's 198th consecutive quarterly cash dividend.

Third Quarter of 2022 Analysis
The primary driver for the decrease in earnings in the third quarter of 2022 as compared to the second quarter of 2022 was the decreased earnings of the steel mills segment. The decrease in the steel mills segment earnings was caused primarily by metal margin contraction and reduced shipping volumes, particularly at our sheet and plate mills. The steel products segment had another strong quarter in the third quarter of 2022, and its earnings increased modestly from the second quarter of 2022.  Raw materials segment earnings increased in the third quarter of 2022 as compared to the second quarter of 2022 as decreased profitability in our scrap brokerage and processing operations was offset by the increased profitability of our direct reduced iron facilities.

Fourth Quarter of 2022 Outlook
We continue to believe that 2022 will be the most profitable year for earnings in Nucor's history. As we approach the end of the year, we are seeing increasingly challenging market conditions amid economic uncertainty.

We expect fourth quarter of 2022 earnings to be decreased from the third quarter of 2022. In the steel mills segment, we expect considerably lower earnings in the fourth quarter of 2022 as compared to the third quarter of 2022 due to lower average selling prices and lower volumes, with the largest decrease in profitability expected at our sheet mills. The steel products segment is expected to have another strong quarter in the fourth quarter of 2022, but the segment's profitability is anticipated to decrease from the third quarter of 2022 primarily due to typical seasonality experienced in the fourth quarter. The raw materials segment is expected to have significantly decreased earnings in the fourth quarter of 2022 as compared to the third quarter of 2022 due to decreased selling prices for raw materials.

Earnings Conference Call
You are invited to listen to the live broadcast of Nucor's conference call during which management will discuss Nucor's third quarter results on October 20, 2022 at 2:00 p.m. Eastern Time. The conference call will be available over the Internet at www.nucor.com, under Investors.

About Nucor
Nucor and its affiliates are manufacturers of steel and steel products, with operating facilities in the United States, Canada and Mexico. Products produced include: carbon and alloy steel -- in bars, beams, sheet and plate; hollow structural section tubing; electrical conduit; steel racking; steel piling; steel joists and joist girders; steel deck; fabricated concrete reinforcing steel; cold finished steel; precision castings; steel fasteners; metal building systems; insulated metal panels; overhead doors; steel grating; and wire and wire mesh. Nucor, through The David J. Joseph Company and its affiliates, also brokers ferrous and nonferrous metals, pig iron and hot briquetted iron / direct reduced iron; supplies ferro-alloys; and processes ferrous and nonferrous scrap. Nucor is North America's largest recycler.

Forward-Looking Statements
Certain statements contained in this news release are "forward-looking statements" that involve risks and uncertainties which we expect will or may occur in the future and may impact our business, financial condition and results of operations. The words "anticipate," "believe," "expect," "intend," "project," "may," "will," "should," "could" and similar expressions are intended to identify those forward-looking statements. These forward-looking statements reflect the Company's best judgment based on current information, and, although we base these statements on circumstances that we believe to be reasonable when made, there can be no assurance that future events will not affect the accuracy of such forward-looking information. As such, the forward-looking statements are not guarantees of future performance, and actual results may vary materially from the projected results and expectations discussed in this news release. Factors that might cause the Company's actual results to differ materially from those anticipated in forward-looking statements include, but are not limited to: (1) competitive pressure on sales and pricing, including pressure from imports and substitute materials; (2) U.S. and foreign trade policies affecting steel imports or exports; (3) the sensitivity of the results of our operations to general market conditions, and in particular, prevailing market steel prices and changes in the supply and cost of raw materials, including pig iron, iron ore and scrap steel; (4) the availability and cost of electricity and natural gas, which could negatively affect our cost of steel production or result in a delay or cancellation of existing or future drilling within our natural gas drilling programs; (5) critical equipment failures and business interruptions; (6) market demand for steel products, which, in the case of many of our products, is driven by the level of nonresidential construction activity in the United States; (7) impairment in the recorded value of inventory, equity investments, fixed assets, goodwill or other long-lived assets; (8) uncertainties and volatility surrounding the global economy, including excess world capacity for steel production, inflation and interest rate changes; (9) fluctuations in currency conversion rates; (10) significant changes in laws or government regulations affecting environmental compliance, including legislation and regulations that result in greater regulation of greenhouse gas emissions that could increase our energy costs, capital expenditures and operating costs or cause one or more of our permits to be revoked or make it more difficult to obtain permit modifications; (11) the cyclical nature of the steel industry; (12) capital investments and their impact on our performance; (13) our safety performance; (14) our ability to integrate businesses we acquire; and (15) the impact of the COVID-19 pandemic and any variants of the virus. These and other factors are discussed in Nucor's regulatory filings with the United States Securities and Exchange Commission, including those in "Item 1A. Risk Factors" of Nucor's Annual Report on Form 10-K for the year ended December 31, 2021. The forward-looking statements contained in this news release speak only as of this date, and Nucor does not assume any obligation to update them, except as may be required by applicable law.

 

Tonnage Data


(In thousands)





























Three Months (13 Weeks) Ended



Nine Months (39 Weeks) Ended




Oct. 1, 2022



Oct. 2, 2021



Percent
Change



Oct. 1, 2022



Oct. 2, 2021



Percent
Change


Steel mills total shipments:

























Sheet



2,677




2,789




-4

%



7,996




8,629




-7

%

Bars



2,169




2,350




-8

%



6,728




7,092




-5

%

Structural



583




738




-21

%



1,847




2,042




-10

%

Plate



379




605




-37

%



1,251




1,800




-31

%

Other



61




61



-




309




258




20

%




5,869




6,543




-10

%



18,131




19,821




-9

%


























Sales tons to outside customers:

























Steel mills



4,553




5,144




-11

%



14,133




15,690




-10

%

Joist



160




190




-16

%



497




529




-6

%

Deck



129




139




-7

%



388




404




-4

%

Cold finished



112




123




-9

%



368




383




-4

%

Rebar fabrication products



350




323




8

%



980




943




4

%

Piling



119




144




-17

%



349




451




-23

%

Tubular products



231




260




-11

%



735




779




-6

%

Other steel products



190




128




48

%



520




337




54

%

Raw materials



571




721




-21

%



1,816




2,314




-22

%




6,415




7,172




-11

%



19,786




21,830




-9

%


























 

Condensed Consolidated Statements of Earnings (Unaudited)

(In thousands, except per share data)




Three Months (13 Weeks) Ended



Nine Months (39 Weeks) Ended




Oct. 1, 2022



Oct. 2, 2021



Oct. 1, 2022



Oct. 2, 2021


Net sales


$

10,500,755



$

10,313,223



$

32,788,511



$

26,119,527


Costs, expenses and other:

















Cost of products sold



7,657,364




6,906,950




22,382,718




18,617,314


Marketing, administrative and other expenses



486,560




526,345




1,574,355




1,204,539


Equity in earnings of unconsolidated affiliates



(8,438)




(32,464)




(23,246)




(65,106)


Losses on assets



-




-




-




50,970


Interest expense, net



42,347




43,285




143,245




118,709





8,177,833




7,444,116




24,077,072




19,926,426


Earnings before income taxes and noncontrolling interests



2,322,922




2,869,107




8,711,439




6,193,101


Provision for income taxes



523,879




645,842




1,958,044




1,410,863


Net earnings



1,799,043




2,223,265




6,753,395




4,782,238


Earnings attributable to noncontrolling interests



104,295




95,522




401,791




205,195


Net earnings attributable to Nucor stockholders


$

1,694,748



$

2,127,743



$

6,351,604



$

4,577,043


Net earnings per share:

















Basic


$

6.51



$

7.29



$

23.90



$

15.37


Diluted


$

6.50



$

7.28



$

23.85



$

15.34


Average shares outstanding:

















Basic



259,102




290,510




264,655




296,431


Diluted



259,526




291,152




265,239




296,928


 

Condensed Consolidated Balance Sheets (Unaudited)

(In thousands)




Oct. 1, 2022



Dec. 31, 2021


ASSETS









Current assets:









Cash and cash equivalents


$

3,049,864



$

2,364,858


Short-term investments



377,426




253,005


Accounts receivable, net



4,200,643




3,853,972


Inventories, net



6,046,235




6,011,182


Other current assets



682,289




316,540


Total current assets



14,356,457




12,799,557


Property, plant and equipment, net



9,440,074




8,114,818


Restricted cash and cash equivalents



79,880




143,800


Goodwill



3,917,452




2,827,344


Other intangible assets, net



3,392,941




1,103,759


Other assets



885,900




833,794


Total assets


$

32,072,704



$

25,823,072


LIABILITIES









Current liabilities:









Short-term debt


$

64,649



$

107,723


Current portion of long-term debt and finance lease obligations



28,994




615,678


Accounts payable



1,810,388




1,974,041


Salaries, wages and related accruals



1,613,387




1,495,166


Accrued expenses and other current liabilities



1,114,671




964,805


Total current liabilities



4,632,089




5,157,413


Long-term debt and finance lease obligations due after one year



6,617,030




4,961,410


Deferred credits and other liabilities



1,998,906




1,100,455


Total liabilities



13,248,025




11,219,278


Commitments and contingencies









EQUITY









Nucor stockholders' equity:









Common stock



152,061




152,061


Additional paid-in capital



2,128,521




2,140,608


Retained earnings



23,629,649




17,674,100


Accumulated other comprehensive loss,

   net of income taxes



(103,553)




(115,282)


Treasury stock



(8,098,221)




(5,835,098)


Total Nucor stockholders' equity



17,708,457




14,016,389


Noncontrolling interests



1,116,222




587,405


Total equity



18,824,679




14,603,794


Total liabilities and equity


$

32,072,704



$

25,823,072











 

Condensed Consolidated Statements of Cash Flows (In thousands) (Unaudited)




Nine Months (39 Weeks) Ended




Oct. 1, 2022



Oct. 2, 2021


Operating activities:









Net earnings


$

6,753,395



$

4,782,238


Adjustments:









Depreciation



609,933




546,619


Amortization



164,480




76,656


Stock-based compensation



99,838




97,652


Deferred income taxes



(33,116)




166,748


Distributions from affiliates



25,571




200


Equity in earnings of unconsolidated affiliates



(23,246)




(65,106)


Losses on assets



-




50,970


Changes in assets and liabilities (exclusive of acquisitions and dispositions):









Accounts receivable



(104,751)




(1,622,668)


Inventories



371,068




(1,976,738)


Accounts payable



(299,760)




343,014


Federal income taxes



(302,335)




262,195


Salaries, wages and related accruals



121,243




835,381


Other operating activities



156,201




123,202


Cash provided by operating activities



7,538,521




3,620,363


Investing activities:









Capital expenditures



(1,430,125)




(1,207,088)


Investment in and advances to affiliates



(246)




(193)


Sale of business



99,681




-


Disposition of plant and equipment



27,278




15,581


Acquisitions (net of cash acquired)



(3,549,764)




(1,346,608)


Purchases of investments



(563,770)




(394,141)


Proceeds from the sale of investments



439,348




554,898


Other investing activities



(9,595)




1,042


Cash used in investing activities



(4,987,193)




(2,376,509)


Financing activities:









Net change in short-term debt



(43,074)




44,831


Proceeds from issuance of long-term debt, net of discount



2,091,934




196,990


Repayment of long-term debt



(1,108,500)




-


Bond issuance costs



(13,138)




-


Proceeds from exercise of stock options



21,604




143,874


Payment of tax withholdings on certain stock-based compensation



(62,869)




(71,494)


Distributions to noncontrolling interests



(300,772)




(120,619)


Cash dividends



(404,150)




(366,606)


Acquisition of treasury stock



(2,359,971)




(1,773,848)


Proceeds from government incentives



275,000




-


Other financing activities



(21,085)




(7,993)


Cash used in financing activities



(1,925,021)




(1,954,865)


Effect of exchange rate changes on cash



(5,221)




1,720


(Decrease) increase in cash and cash equivalents and

   restricted cash and cash equivalents



621,086




(709,291)


Cash and cash equivalents and restricted cash and cash

   equivalents - beginning of year



2,508,658




2,754,929


Cash and cash equivalents and restricted cash and cash

   equivalents - end of nine months


$

3,129,744



$

2,045,638


Non-cash investing activity:









Change in accrued plant and equipment purchases


$

(31,469)



$

14,997











 

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SOURCE Nucor Corporation

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