Nucor Reports Results for First Quarter of 2010

CHARLOTTE, N.C., April 22 /PRNewswire-FirstCall/ -- Nucor Corporation (NYSE: NUE) announced today consolidated net earnings of $31.0 million, or $0.10 per diluted share, for the first quarter of 2010.  By comparison, Nucor reported a net loss of $189.6 million, or $0.60 per diluted share, in the first quarter of 2009 and earned $58.9 million, or $0.18 per diluted share, in the fourth quarter of 2009.  

Nucor's consolidated net sales increased 38% to $3.65 billion compared with $2.65 billion in the first quarter of 2009 due to a 48% increase in total tons shipped to outside customers, partially offset by a 7% decrease in average sales price per ton.  Consolidated net sales increased 24% compared with $2.94 billion in the fourth quarter of 2009 due to a 19% increase in total tons shipped to outside customers and a 5% increase in average sales price per ton.

The average scrap and scrap substitute cost per ton used during the first quarter of 2010 was $318, a decrease of 5% compared to $333 in the first quarter of 2009 and an increase of 15% from $276 in the fourth quarter of 2009.  

Nucor incurred a charge to value inventories using the last-in, first-out (LIFO) method of accounting of $24.0 million in the first quarter of 2010, compared with a credit of $105.0 million in the first quarter of 2009 and a credit of $116.9 million in the fourth quarter of 2009.  

The steel mill utilization rate increased to approximately 73% in the first quarter from 45% in last year's first quarter and 58% in the fourth quarter.  As a result of this increased utilization, total energy costs decreased approximately $10 per ton from the first quarter of 2009 to the first quarter of 2010 and decreased approximately $1 per ton from the fourth quarter of 2009.  

Pre-operating and start-up costs of new facilities were $50.5 million in the first quarter, primarily related to the SBQ mill in Memphis, Tennessee, and the galvanizing line in Decatur, Alabama.  By comparison, pre-operating and start-up costs were $33.2 million in the first quarter of 2009 and $48.1 million in the fourth quarter of 2009.  

Our liquidity position remains strong with $2.0 billion in cash and cash equivalents and short-term investments and an untapped $1.3 billion revolving credit facility that matures in November 2012.

In February, Nucor's board declared a cash dividend of $0.36 per share payable on May 12, 2010 to stockholders of record on March 31, 2010.  This dividend is Nucor's 148th consecutive quarterly cash dividend, a record we expect to continue.

In March, the David J. Joseph Company ("DJJ") acquired the assets and business of Ocala Recycling LLC, which operates four facilities in Florida, including one automobile shredder.  Production at the four yards combined totals over 100,000 tons annually.  DJJ operates the Ocala Recycling facilities as part of Trademark Metals Recycling LLC.

Subsequent to the first quarter, Nucor acquired a 50% interest in NuMit LLC, which will invest in various steel and steel related activities, both in North America and globally.  As part of the agreement, Mitsui and Co. (U.S.A.), Inc., a wholly owned subsidiary of Mitsui and Co., Ltd., contributed 100% of Steel Technologies Inc.  Steel Technologies operates 23 sheet steel processing facilities throughout the U.S., Canada and Mexico.  The transaction is not expected to result in material goodwill.

First quarter results showed significant improvement in the operating rates at our sheet and plate mills, as well as our scrap business.  Overall, operating performance improved from the beginning of the quarter to the end of the quarter, and we expect the second quarter to be an improvement over our first quarter results.  The most challenging markets for our products continue to be those associated with residential and non-residential construction, which continue to show little, if any, strength.  This is particularly true for our downstream businesses.  We will provide additional and more quantitative earnings guidance after the midpoint between our quarterly earnings releases.

Nucor and affiliates are manufacturers of steel products, with operating facilities primarily in the U.S. and Canada. Products produced include: carbon and alloy steel -- in bars, beams, sheet and plate; steel joists and joist girders; steel deck; fabricated concrete reinforcing steel; cold finished steel; steel fasteners; metal building systems; light gauge steel framing; steel grating and expanded metal; and wire and wire mesh. Nucor, through DJJ, also brokers ferrous and nonferrous metals, pig iron and HBI/DRI; supplies ferro-alloys; and processes ferrous and nonferrous scrap. Nucor is North America's largest recycler.

Certain statements contained in this news release are "forward-looking statements" that involve risks and uncertainties.  The words "believe," "expect," "project," "will," "should" and similar expressions are intended to identify those forward-looking statements.  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) the sensitivity of the results of our operations to prevailing steel prices and the changes in the supply and cost of raw materials, including scrap steel; (2) market demand for steel products; (3) energy costs and availability; (4) competitive pressure on sales and pricing, including competition from imports and substitute materials; and (5) capital investments and their impact on our performance.  These and other factors are outlined in Nucor's regulatory filings with the Securities and Exchange Commission, including those in Nucor's December 31, 2009 Annual Report on Form 10-K.  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.

You are invited to listen to the live broadcast of Nucor's conference call in which management will discuss Nucor's first quarter results on April 22, 2010 at 2:00 p.m. eastern time.  The conference call will be available over the Internet at www.nucor.com, under Investor Relations.  

SOURCE Nucor Corporation