Steel Dynamics Provides First Quarter 2025 Earnings Guidance

Rhea-AI Summary

Steel Dynamics (NASDAQ: STLD) has provided Q1 2025 earnings guidance of $1.36 to $1.40 per diluted share, compared to Q4 2024 earnings of $1.36 and Q1 2024 earnings of $3.67 per share. The company expects stronger steel operations profitability due to increased shipments, despite some margin compression.

Key operational highlights include:

• Sinton Texas Flat Roll Division operating at >90% production levels
• Higher metals recycling earnings expected vs Q4 2024
• Lower steel fabrication earnings anticipated due to seasonal factors
• Successful commissioning of Columbus aluminum mill with first ingot cast in January

The company increased its Q1 2025 cash dividend by 9% to $0.50 per share and authorized an additional $1.5 billion share repurchase program. As of March 12, 2025, STLD had repurchased $191 million of common stock in Q1.

Positive

• Increased Q1 2025 dividend by 9% to $0.50 per share
• New $1.5 billion share repurchase authorization
• Sinton Texas facility operating at >90% production capacity
• Higher metals recycling earnings expected vs Q4 2024
• Strong order backlog extending into Q3 2025
• Columbus aluminum mill development on schedule

Negative

• Q1 2025 EPS guidance ($1.36-1.40) shows 62% decline from Q1 2024 ($3.67)
• Metal margin compression in steel operations
• Lower steel fabrication earnings expected vs Q4 2024
• 5% decline in realized pricing for steel fabrication

Insights

Financial Analyst

Steel Dynamics' Q1 2025 earnings guidance of $1.36-$1.40 per share represents flat sequential performance but a substantial 62% year-over-year decline from $3.67 per share in Q1 2024. This significant YoY earnings compression reflects broader steel pricing pressures, though management's actions signal confidence in underlying business strength despite near-term headwinds.

The company's 9% dividend increase to $0.50 per share and authorization of an additional $1.5 billion share repurchase program after exhausting a previous $1.5 billion allocation are particularly noteworthy. Already in Q1, they've repurchased $191 million in shares, demonstrating robust capital return prioritization despite earnings pressure.

Segment performance shows mixed signals: steel operations expect sequential improvement from higher shipments offsetting margin compression; metals recycling anticipates stronger results from improved pricing; while steel fabrication forecasts weaker performance from seasonal factors and modest price declines. The delay between contractual steel pricing and recent spot price improvements suggests potential margin recovery in coming quarters.

The Sinton Texas facility's 90%+ utilization rate and projected Q2 profitability represent an important inflection point, while the aluminum expansion remains on schedule for mid-2025 shipping, though meaningful financial contribution likely remains further out. Order backlog extending into Q3 2025 provides visibility while signaling stable demand despite economic uncertainties.

Industrial Manufacturing Expert

Steel Dynamics' operational metrics reveal important sector dynamics beyond the headline numbers. The Sinton Texas facility's production exceeding 90% capacity marks a significant achievement, especially with simultaneous quality and efficiency improvements. This facility's projected Q2 profitability represents the culmination of substantial investment finally reaching fruition.

Demand patterns show distinct segment performance: energy, non-residential construction, automotive, and industrial sectors are leading steel demand, while the fabrication business specifically highlights strength in commercial, data center, manufacturing, warehouse, and healthcare sectors. This diversified end-market exposure provides some insulation against individual sector weaknesses.

The company's aluminum expansion represents a strategic diversification effort with multiple components progressing simultaneously: the Columbus, Mississippi mill, the San Luis Potosi slab center, ingot casting operation, hot line, cold rolling mill, and automotive/can coating lines. This significant capital project remains on track despite its complexity, with first ingot already cast in January.

The improving fabrication order backlog extending into Q3 with "attractive pricing" signals market stabilization after what appears to have been recent pricing pressures. Management's comments about domestic manufacturing investment, onshoring trends, and infrastructure spending suggest confidence in sustainable demand drivers beyond current quarters, potentially explaining their willingness to continue significant capital returns despite the YoY earnings decline.

FORT WAYNE, Ind., March 17, 2025 /PRNewswire/ -- Steel Dynamics, Inc. (NASDAQ/GS: STLD) today provided first quarter 2025 earnings guidance in the range of $1.36 to $1.40 per diluted share. Comparatively, the company's sequential fourth quarter 2024 earnings were $1.36 per diluted share and prior year first quarter earnings were $3.67 per diluted share.

First quarter 2025 profitability from the company's steel operations is expected to be stronger than sequential fourth quarter results, based on increased shipments more than offsetting some metal margin compression, as contractual steel pricing lagged recent spot price improvements, which will be realized in the coming months. The energy, non-residential construction, automotive, and industrial sectors continue to lead demand. The company's Sinton Texas Flat Roll Division operated at production levels in excess of 90 percent in the first quarter 2025, while continuing to improve product quality and cost efficiency, continuing its clear path to profitability in the second quarter 2025.

First quarter 2025 earnings from the company's metals recycling operations are expected to be higher than sequential fourth quarter 2024 results, based on stronger realized pricing and stable volumes for ferrous and nonferrous materials.  

First quarter 2025 earnings from the company's steel fabrication operations are expected to be lower than sequential fourth quarter results, based on seasonally lower shipments and less than a five percent decline in realized pricing. The pace of order activity increased in the first quarter, and the order backlog improved, extending well into the third quarter of 2025, with attractive related pricing levels. Improved demand was supported largely by the commercial, data center, manufacturing, warehouse, and healthcare sectors.  Further, the accelerated announcements for meaningful manufacturing domestic investment and onshoring, coupled with the U.S. infrastructure program are expected to positively impact demand for not only steel joist and deck products, but also for flat rolled and long product steel. 

The aluminum team is continuing with successful commissioning of the company's Columbus, Mississippi aluminum flat rolled products mill, along with the San Luis Potosi satellite recycled slab center. The team successfully cast its first aluminum ingot in January and has since completed start-up of the Ingot Scalper. Construction is close to complete on the Hot Line and No. 1 Cold Rolling Mill. Finishing equipment installation for the Automotive Treatment and Can Coil Coating lines are also on schedule. The company continues to expect to begin shipping material mid-2025.

Based on continued confidence in the company's earnings outlook and cash flow generation, in February 2025 the company's board of directors increased the company's first quarter 2025 cash dividend by nine percent to $0.50 per common share and also authorized an additional $1.5 billion for share repurchases, as the previous program of $1.5 billion was exhausted. As of March 12, 2025, the company had repurchased $191 million, or one percent, of its common stock during the first quarter.

The company plans to release its first quarter 2025 earnings after the markets close on Tuesday, April 22, 2025, and will hold a conference call the following day at 11:00 a.m. Eastern Daylight Time to review the company's results. 

About Steel Dynamics, Inc.
Steel Dynamics is one of the largest domestic steel producers and metals recyclers in North America, based on estimated annual steelmaking and metals recycling capability, with facilities located throughout the United States, and in Mexico. Steel Dynamics produces steel products, including hot roll, cold roll, and coated sheet steel, structural steel beams and shapes, rail, engineered special-bar-quality steel, cold finished steel, merchant bar products, specialty steel sections, and steel joists and deck. In addition, the company produces liquid pig iron and processes and sells ferrous and nonferrous scrap.

Forward-Looking Statements
This press release contains some predictive statements about future events, including statements related to conditions in domestic or global economies, conditions in steel, aluminum, and recycled metals market places, Steel Dynamics' revenues, costs of purchased materials, future profitability and earnings, and the operation of new, existing or planned facilities. These statements, which we generally precede or accompany by such typical conditional words as "anticipate", "intend", "believe", "estimate", "plan", "seek", "project", or "expect", or by the words "may", "will", or "should", 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. These statements speak only as of this date and are based upon information and assumptions, which we consider reasonable as of this date, concerning our businesses and the environments in which they operate. Such predictive statements are not guarantees of future performance, and we undertake no duty to update or revise any such statements. Some factors that could cause such forward-looking statements to turn out differently than anticipated include: (1) domestic and global economic factors; (2) global steelmaking overcapacity and imports of steel, together with increased scrap prices; (3) pandemics, epidemics, widespread illness or other health issues; (4) the cyclical nature of the steel industry and the industries we serve; (5) volatility and major fluctuations in prices and availability of scrap metal, scrap substitutes and supplies, and our potential inability to pass higher costs on to our customers; (6) cost and availability of electricity, natural gas, oil, and other energy resources are subject to volatile market conditions; (7) increased environmental, greenhouse gas emissions and sustainability considerations from our customers and investors or related regulations; (8) compliance with and changes in environmental and remediation requirements; (9) significant price and other forms of competition from other steel and aluminum producers, scrap processors and alternative materials; (10) availability of an adequate source of supply of scrap for our metals recycling operations; (11) cybersecurity threats and risks to the security of our sensitive data and information technology; (12) the implementation of our growth strategy; (13) our ability to retain, develop and attract key personnel; (14) litigation and legal compliance; (15) unexpected equipment downtime or shutdowns; (16) governmental agencies may refuse to grant or renew some of our licenses and permits; (17) our senior unsecured credit facility contains, and any future financing agreements may contain, restrictive covenants that may limit our flexibility; and (18) the impacts of impairment charges.

More specifically, we refer you to our more detailed explanation of these and other 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 under the headings Special Note Regarding Forward-Looking Statements and Risk Factors, in our Quarterly Reports on Form 10-Q, or in other reports which we file with the Securities and Exchange Commission. These reports are available publicly on the Securities and Exchange Commission website, www.sec.gov, and on our website, www.steeldynamics.com under "Investors – SEC Filings."

View original content to download multimedia:https://www.prnewswire.com/news-releases/steel-dynamics-provides-first-quarter-2025-earnings-guidance-302403553.html

SOURCE Steel Dynamics, Inc.

FAQ

What is Steel Dynamics' Q1 2025 earnings guidance per share?

Steel Dynamics projects Q1 2025 earnings between $1.36 to $1.40 per diluted share.

How much did Steel Dynamics (STLD) increase its dividend in Q1 2025?

Steel Dynamics increased its Q1 2025 cash dividend by 9% to $0.50 per common share.

What is the size of STLD's new share repurchase authorization in February 2025?

The board authorized an additional $1.5 billion for share repurchases after exhausting the previous $1.5 billion program.

How is Steel Dynamics' Sinton Texas Flat Roll Division performing in Q1 2025?

The Sinton Texas facility operated at production levels exceeding 90% in Q1 2025, with improving product quality and cost efficiency.

When will Steel Dynamics' Columbus aluminum mill begin shipping material?

The company expects to begin shipping material from the Columbus aluminum mill by mid-2025.