Nucor Reports Results for the Third Quarter of 2023
- Nucor reports Q3 earnings of $4.57 per share, bringing year-to-date diluted EPS to $14.83. Net earnings of $1.14 billion. Returned $627 million to stockholders during the quarter through share repurchases and dividends. Nucor has $6.73 billion in cash and cash equivalents. Nucor's board of directors approved a new share repurchase program up to $4.00 billion. Nucor declared a cash dividend of $0.51 per share.
- Nucor's consolidated net sales decreased 8% to $8.78 billion. Earnings for the steel mills and steel products segments declined due to lower pricing and volumes. Q4 earnings expected to decrease due to lower pricing and volumes.
Third Quarter of 2023 Highlights
$4.57 $14.83 - Net earnings attributable to Nucor stockholders of
$1.14 billion - Net earnings before noncontrolling interests of
$1.22 billion $1.82 billion - Returned
$627 million
In the first nine months of 2023, Nucor reported consolidated net earnings attributable to Nucor stockholders of
"We are on pace to set another safety record for the fifth consecutive year. And with
Selected Segment Data
Earnings (loss) before income taxes and noncontrolling interests by segment for the third quarter and first nine months of 2023 and 2022 were as follows (in thousands):
Three Months (13 Weeks) Ended | Nine Months (39 Weeks) Ended | |||||||||||||||
September 30, 2023 | October 1, 2022 | September 30, 2023 | October 1, 2022 | |||||||||||||
Steel mills | $ | 882,614 | $ | 1,287,855 | $ | 3,124,549 | $ | 6,682,432 | ||||||||
Steel products | 806,731 | 1,196,845 | 2,788,322 | 3,011,644 | ||||||||||||
Raw materials | 71,367 | 279,189 | 267,918 | 638,640 | ||||||||||||
Corporate/eliminations | (212,630) | (440,967) | (986,141) | (1,621,277) | ||||||||||||
$ | 1,548,082 | $ | 2,322,922 | $ | 5,194,648 | $ | 8,711,439 | |||||||||
Financial Review
Nucor's consolidated net sales decreased
In the first nine months of 2023, Nucor's consolidated net sales of
The average scrap and scrap substitute cost per gross ton used in the third quarter of 2023 was
Pre-operating and start-up costs related to the Company's growth projects were approximately
In the first nine months of 2023, pre-operating and start-up costs related to the Company's growth projects were approximately
Overall operating rates at the Company's steel mills decreased to
Financial Strength
At the end of the third quarter of 2023, we had
Commitment to Returning Capital to Stockholders
During the third quarter of 2023, Nucor repurchased approximately 3.0 million shares of its common stock at an average price of
On September 14, 2023, Nucor's board of directors declared a cash dividend of
Third Quarter of 2023 Analysis
Earnings for the steel mills segment declined in the third quarter of 2023 as compared to the second quarter of 2023 primarily due to lower pricing, and to a lesser extent, decreased volumes. The largest impact on earnings occurred at our sheet mills. The earnings of the steel products segment decreased in the third quarter of 2023 as compared to the second quarter of 2023 also due to lower realized prices and volumes. Earnings for the raw materials segment decreased in the third quarter of 2023 as compared to the second quarter of 2023 due to margin compression at our direct reduced iron, or DRI, facilities and scrap processing operations.
Fourth Quarter of 2023 Outlook
We expect earnings in the fourth quarter of 2023 to decrease compared to the third quarter of 2023 due primarily to lower pricing across all three operating segments, and, to a lesser extent, decreased volumes. In the steel mills segment, we expect the decrease in realized pricing to be most pronounced at our sheet mills. In the steel products segment, we expect decreased earnings due to moderating average selling prices at most of the product groups within the steel products segment and lower volumes. Earnings for the raw materials segment are expected to decrease in the fourth quarter of 2023 as compared to the third quarter of 2023 due to lower pricing for raw materials and planned outages at our DRI facilities.
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 24, 2023 at 10:00 a.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
Non-GAAP Financial Measures
The Company uses certain non-GAAP (Generally Accepted Accounting Principles) financial measures in this news release, including EBITDA. Generally, a non-GAAP financial measure is a numerical measure of a company's performance or financial position that either excludes or includes amounts that are not normally excluded or included in the most directly comparable financial measure calculated and presented in accordance with GAAP.
We define EBITDA as net earnings before noncontrolling interests, adding back the following items: interest (income) expense, net; provision for income taxes; depreciation; and amortization. The Company believes that this definition of EBITDA is a more relevant supplemental measure of performance. First and second quarter of 2023 EBITDA was
Management presents the non-GAAP financial measure of EBITDA in this news release because it considers it to be an important supplemental measure of performance. Management believes that this non-GAAP financial measure provides additional insight for analysts and investors evaluating the Company's financial and operational performance by providing a consistent basis of comparison across periods.
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)
Tonnage Data | ||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||
Three Months (13 Weeks) Ended | Nine Months (39 Weeks) Ended | |||||||||||||||||||||||
September 30, 2023 | October 1, 2022 | Percent Change | September 30, 2023 | October 1, 2022 | Percent Change | |||||||||||||||||||
Steel mills total shipments: | ||||||||||||||||||||||||
Sheet | 2,723 | 2,677 | 2 | % | 8,328 | 7,996 | 4 | % | ||||||||||||||||
Bars | 2,001 | 2,169 | -8 | % | 6,292 | 6,728 | -6 | % | ||||||||||||||||
Structural | 530 | 583 | -9 | % | 1,571 | 1,847 | -15 | % | ||||||||||||||||
Plate | 460 | 379 | 21 | % | 1,434 | 1,251 | 15 | % | ||||||||||||||||
Other | 32 | 61 | -48 | % | 135 | 309 | -56 | % | ||||||||||||||||
5,746 | 5,869 | -2 | % | 17,760 | 18,131 | -2 | % | |||||||||||||||||
Sales tons to outside customers: | ||||||||||||||||||||||||
Steel mills | 4,578 | 4,553 | 1 | % | 14,156 | 14,133 | - | |||||||||||||||||
Joist | 127 | 160 | -21 | % | 404 | 497 | -19 | % | ||||||||||||||||
Deck | 104 | 129 | -19 | % | 310 | 388 | -20 | % | ||||||||||||||||
Cold finished | 103 | 112 | -8 | % | 332 | 368 | -10 | % | ||||||||||||||||
Rebar fabrication products | 307 | 350 | -12 | % | 918 | 980 | -6 | % | ||||||||||||||||
Piling | 117 | 119 | -2 | % | 331 | 349 | -5 | % | ||||||||||||||||
Tubular products | 223 | 231 | -3 | % | 737 | 735 | - | |||||||||||||||||
Other steel products | 160 | 190 | -16 | % | 443 | 520 | -15 | % | ||||||||||||||||
Raw materials | 521 | 571 | -9 | % | 1,640 | 1,816 | -10 | % | ||||||||||||||||
6,240 | 6,415 | -3 | % | 19,271 | 19,786 | -3 | % | |||||||||||||||||
Condensed Consolidated Statements of Earnings (Unaudited) (In thousands, except per share data) | ||||||||||||||||
Three Months (13 Weeks) Ended | Nine Months (39 Weeks) Ended | |||||||||||||||
September 30, 2023 | October 1, 2022 | September 30, 2023 | October 1, 2022 | |||||||||||||
Net sales | $ | 8,775,734 | $ | 10,500,755 | $ | 27,008,970 | $ | 32,788,511 | ||||||||
Costs, expenses and other: | ||||||||||||||||
Cost of products sold | 6,854,934 | 7,657,364 | 20,588,294 | 22,382,718 | ||||||||||||
Marketing, administrative and other expenses | 385,768 | 486,560 | 1,229,051 | 1,574,355 | ||||||||||||
Equity in losses (earnings) of unconsolidated affiliates | 1,083 | (8,438) | (3,671) | (23,246) | ||||||||||||
Interest (income) expense, net | (14,133) | 42,347 | 648 | 143,245 | ||||||||||||
7,227,652 | 8,177,833 | 21,814,322 | 24,077,072 | |||||||||||||
Earnings before income taxes and noncontrolling interests | 1,548,082 | 2,322,922 | 5,194,648 | 8,711,439 | ||||||||||||
Provision for income taxes | 326,827 | 523,879 | 1,154,689 | 1,958,044 | ||||||||||||
Net earnings before noncontrolling interests | 1,221,255 | 1,799,043 | 4,039,959 | 6,753,395 | ||||||||||||
Earnings attributable to noncontrolling interests | 79,749 | 104,295 | 300,557 | 401,791 | ||||||||||||
Net earnings attributable to Nucor stockholders | $ | 1,141,506 | $ | 1,694,748 | $ | 3,739,402 | $ | 6,351,604 | ||||||||
Net earnings per share: | ||||||||||||||||
Basic | $ | 4.58 | $ | 6.51 | $ | 14.86 | $ | 23.90 | ||||||||
Diluted | $ | 4.57 | $ | 6.50 | $ | 14.83 | $ | 23.85 | ||||||||
Average shares outstanding: | ||||||||||||||||
Basic | 248,504 | 259,102 | 250,752 | 264,655 | ||||||||||||
Diluted | 248,916 | 259,526 | 251,179 | 265,239 | ||||||||||||
Condensed Consolidated Balance Sheets (Unaudited) (In thousands) | ||||||||
September 30, 2023 | December 31, 2022 | |||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 5,855,950 | $ | 4,280,852 | ||||
Short-term investments | 863,140 | 576,946 | ||||||
Accounts receivable, net | 3,427,697 | 3,591,030 | ||||||
Inventories, net | 5,246,365 | 5,453,531 | ||||||
Other current assets | 555,784 | 789,325 | ||||||
Total current assets | 15,948,936 | 14,691,684 | ||||||
Property, plant and equipment, net | 10,355,848 | 9,616,920 | ||||||
Restricted cash and cash equivalents | 12,832 | 80,368 | ||||||
Goodwill | 3,922,267 | 3,920,060 | ||||||
Other intangible assets, net | 3,146,973 | 3,322,265 | ||||||
Other assets | 880,930 | 847,913 | ||||||
Total assets | $ | 34,267,786 | $ | 32,479,210 | ||||
LIABILITIES | ||||||||
Current liabilities: | ||||||||
Short-term debt | $ | 35,938 | $ | 49,081 | ||||
Current portion of long-term debt and finance lease obligations | 24,934 | 28,582 | ||||||
Accounts payable | 1,854,707 | 1,649,523 | ||||||
Salaries, wages and related accruals | 1,268,771 | 1,654,210 | ||||||
Accrued expenses and other current liabilities | 1,099,498 | 948,348 | ||||||
Total current liabilities | 4,283,848 | 4,329,744 | ||||||
Long-term debt and finance lease obligations due after one year | 6,620,586 | 6,613,687 | ||||||
Deferred credits and other liabilities | 1,854,270 | 1,965,873 | ||||||
Total liabilities | 12,758,704 | 12,909,304 | ||||||
Commitments and contingencies | ||||||||
EQUITY | ||||||||
Nucor stockholders' equity: | ||||||||
Common stock | 152,061 | 152,061 | ||||||
Additional paid-in capital | 2,165,635 | 2,143,520 | ||||||
Retained earnings | 28,110,225 | 24,754,873 | ||||||
Accumulated other comprehensive loss, net of income taxes | (148,827) | (137,517) | ||||||
Treasury stock | (9,813,377) | (8,498,243) | ||||||
Total Nucor stockholders' equity | 20,465,717 | 18,414,694 | ||||||
Noncontrolling interests | 1,043,365 | 1,155,212 | ||||||
Total equity | 21,509,082 | 19,569,906 | ||||||
Total liabilities and equity | $ | 34,267,786 | $ | 32,479,210 | ||||
Consolidated Statements of Cash Flows (Unaudited) | ||||||||
Nine Months (39 Weeks) Ended | ||||||||
September 30, 2023 | October 1, 2022 | |||||||
Operating activities: | ||||||||
Net earnings before noncontrolling interests | $ | 4,039,959 | $ | 6,753,395 | ||||
Adjustments: | ||||||||
Depreciation | 681,153 | 609,933 | ||||||
Amortization | 175,701 | 164,480 | ||||||
Stock-based compensation | 101,107 | 99,838 | ||||||
Deferred income taxes | (25,750) | (33,116) | ||||||
Distributions from affiliates | 18,621 | 25,571 | ||||||
Equity in earnings of unconsolidated affiliates | (3,671) | (23,246) | ||||||
Changes in assets and liabilities (exclusive of acquisitions and dispositions): | ||||||||
Accounts receivable | 171,621 | (104,751) | ||||||
Inventories | 209,056 | 371,068 | ||||||
Accounts payable | 164,479 | (299,760) | ||||||
Federal income taxes | 240,667 | (302,335) | ||||||
Salaries, wages and related accruals | (347,026) | 121,243 | ||||||
Other operating activities | 165,692 | 156,201 | ||||||
Cash provided by operating activities | 5,591,609 | 7,538,521 | ||||||
Investing activities: | ||||||||
Capital expenditures | (1,496,248) | (1,430,125) | ||||||
Investment in and advances to affiliates | (35,106) | (246) | ||||||
Sale of business | - | 99,681 | ||||||
Disposition of plant and equipment | 8,617 | 27,278 | ||||||
Acquisitions (net of cash acquired) | - | (3,549,764) | ||||||
Purchases of investments | (1,200,136) | (563,770) | ||||||
Proceeds from the sale of investments | 917,332 | 439,348 | ||||||
Other investing activities | (35,001) | (9,595) | ||||||
Cash used in investing activities | (1,840,542) | (4,987,193) | ||||||
Financing activities: | ||||||||
Net change in short-term debt | (13,142) | (43,074) | ||||||
Proceeds from issuance of long-term debt, net of discount | - | 2,091,934 | ||||||
Repayment of long-term debt | (7,500) | (1,108,500) | ||||||
Bond issuance costs | - | (13,138) | ||||||
Proceeds from exercise of stock options | 10,350 | 21,604 | ||||||
Payment of tax withholdings on certain stock-based compensation | (44,456) | (62,869) | ||||||
Distributions to noncontrolling interests | (412,404) | (300,772) | ||||||
Cash dividends | (387,996) | (404,150) | ||||||
Acquisition of treasury stock | (1,376,757) | (2,359,971) | ||||||
Proceeds from government incentives | - | 275,000 | ||||||
Other financing activities | (12,437) | (21,085) | ||||||
Cash used in financing activities | (2,244,342) | (1,925,021) | ||||||
Effect of exchange rate changes on cash | 837 | (5,221) | ||||||
Increase in cash and cash equivalents and restricted cash and cash equivalents | 1,507,562 | 621,086 | ||||||
Cash and cash equivalents and restricted cash and cash equivalents - beginning of year | 4,361,220 | 2,508,658 | ||||||
Cash and cash equivalents and restricted cash and cash equivalents - end of nine months | $ | 5,868,782 | $ | 3,129,744 | ||||
Non-cash investing activity: | ||||||||
Change in accrued plant and equipment purchases | $ | 40,126 | $ | (31,469) | ||||
Non-GAAP Financial Measures | ||||
Reconciliation of EBITDA (Unaudited) | ||||
(In thousands) | ||||
Three months ended (13 weeks) | ||||
September 30, 2023 | ||||
Net earnings before noncontrolling interests | $ | 1,221,255 | ||
Depreciation | 232,317 | |||
Amortization | 58,470 | |||
Interest income, net | (14,133) | |||
Provision for income taxes | 326,827 | |||
EBITDA | $ | 1,824,736 | ||
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SOURCE Nucor Corporation
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