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Nucor Reports Record Quarterly Earnings for the Third Quarter of 2021

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CHARLOTTE, N.C., Oct. 21, 2021 /PRNewswire/ -- Nucor Corporation (NYSE: NUE) today announced record quarterly consolidated net earnings of $2.13 billion, or $7.28 per diluted share, for the third quarter of 2021. By comparison, Nucor reported consolidated net earnings of $1.51 billion, or $5.04 per diluted share, for the second quarter of 2021 and $193.4 million, or $0.63 per diluted share, for the third quarter of 2020.

In the first nine months of 2021, Nucor reported consolidated net earnings of $4.58 billion, or $15.34 per diluted share, compared with consolidated net earnings of $322.6 million, or $1.06 per diluted share, in the first nine months of 2020.

"During the third quarter, we once again achieved record results, with earnings per share of $7.28. Our third quarter performance surpassed our previous record of $5.04 set in the second quarter of this year and almost matched our full year earnings record of $7.42 that we set back in 2018," said Leon Topalian, Nucor's President and Chief Executive Officer. "Congratulations to the entire Nucor team for delivering the phenomenal results we have seen so far this year while staying focused on our Safety goals. I am incredibly proud of our team and what we have accomplished."

Selected Segment Data
Earnings (loss) before income taxes and noncontrolling interests by segment for the third quarter and first nine months of 2021 and 2020 were as follows (in thousands):



Three Months (13 Weeks) Ended



Nine Months (39 Weeks) Ended




Oct. 2, 2021



Oct. 3, 2020



Oct. 2, 2021



Oct. 3, 2020


Steel mills


$

3,116,539



$

205,152



$

6,606,320



$

512,082


Steel products



368,595




186,976




839,737




502,409


Raw materials



161,870




6,232




505,248




(3,068)


Corporate/eliminations



(777,897)




(107,942)




(1,758,204)




(393,651)




$

2,869,107



$

290,418



$

6,193,101



$

617,772


The steel mills segment and the steel products segment both set a record for the highest quarterly earnings before income taxes and noncontrolling interests in the third quarter of 2021.

Financial Review
Nucor's consolidated net sales increased 17% to $10.31 billion in the third quarter of 2021 compared with $8.79 billion in the second quarter of 2021 and increased 109% compared with $4.93 billion in the third quarter of 2020. Average sales price per ton in the third quarter of 2021 increased 22% compared with the second quarter of 2021 and increased 86% compared with the third quarter of 2020. A total of 7,172,000 tons were shipped to outside customers in the third quarter of 2021, a 4% decrease from the second quarter of 2021 and a 13% increase from the third quarter of 2020. Total steel mill shipments in the third quarter of 2021 decreased 3% as compared to the second quarter of 2021 and increased 16% as compared to the third quarter of 2020. Steel mill shipments to internal customers represented 21% of total steel mill shipments in the third quarter of 2021, compared with 20% in the second quarter of 2021 and 21% in the third quarter of 2020. Downstream steel product shipments to outside customers in the third quarter of 2021 was consistent with the second quarter of 2021 and increased 3% from the third quarter of 2020.

In the first nine months of 2021, Nucor's consolidated net sales of $26.12 billion were an increase of 76% compared with consolidated net sales of $14.88 billion reported in the first nine months of 2020. Total tons shipped to outside customers in the first nine months of 2021 were 21,830,000, an increase of 15% from the first nine months of 2020, while the average sales price per ton in the first nine months of 2021 increased 53% from the first nine months of 2020.

The average scrap and scrap substitute cost per gross ton used in the third quarter of 2021 was $511, a 12% increase compared to $457 in the second quarter of 2021 and an 84% increase compared to $277 in the third quarter of 2020. The average scrap and scrap substitute cost per gross ton used in the first nine months of 2021 was $457, a 60% increase compared to $285 in the first nine months of 2020.

Included in the second quarter of 2021 earnings is a $42.0 million, or $0.11 per diluted share, non-cash impairment charge related to our leasehold interest in unproved oil and natural gas properties. This charge is included in the raw materials segment. Included in earnings for the third quarter of 2020 is a restructuring charge of $16.4 million, or $0.04 per diluted share, related to the realignment of Nucor's metal buildings business. This charge is included in the steel products segment.

Pre-operating and start-up costs related to the Company's growth projects were approximately $36 million, or $0.09 per diluted share, in the third quarter of 2021, compared with approximately $22 million, or $0.06 per diluted share, in the second quarter of 2021 and approximately $22 million, or $0.06 per diluted share, in the third quarter of 2020.

In the first nine months of 2021, pre-operating and start-up costs related to the Company's growth projects were approximately $76 million, or $0.19 per diluted share, compared with approximately $73 million, or $0.18 per diluted share, in the first nine months of 2020.

Overall operating rates at the Company's steel mills decreased to 96% in the third quarter of 2021 as compared to 97% in the second quarter of 2021 and increased from 83% in the third quarter of 2020. Operating rates in the first nine months of 2021 increased to 96% as compared to 80% in the first nine months of 2020.

Financial Strength
At the end of the third quarter of 2021, we had $2.29 billion in cash and cash equivalents, short-term investments and restricted cash and cash equivalents on hand. Our significant cash flow generation has allowed us to maintain our strong liquidity position all while funding two strategic acquisitions and continuing to execute our share repurchase program during the third quarter.

The Company's $1.50 billion revolving credit facility remains undrawn and does not expire until April 2023. Nucor 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 2021, Nucor repurchased approximately 8.2 million shares of its common stock at an average price of $104.60 per share (20.3 million shares year-to-date at an average price of $87.19 per share). As of October 2, 2021, Nucor had approximately 285,799,000 shares outstanding and approximately $1.9 billion remaining for repurchases under its newly authorized share repurchase program.

On September 17, 2021, Nucor's board of directors declared a cash dividend of $0.405 per share. This cash dividend is payable on November 10, 2021 to stockholders of record as of September 30, 2021 and is Nucor's 194th consecutive quarterly cash dividend.

Third Quarter of 2021 Analysis
All three operating segments continued to generate robust profitability in the third quarter of 2021. Earnings of the steel mills segment increased significantly in the third quarter of 2021 as compared to the second quarter of 2021, mainly driven by higher realized selling prices. The steel products segment generated significantly increased earnings in the third quarter of 2021 due to margin expansion caused by higher average selling prices. The raw materials segment's earnings in the third quarter of 2021 were comparable to the second quarter of 2021, excluding the impairment charge recorded in the second quarter of 2021.

Fourth Quarter of 2021 Outlook
We expect continued strong results for the fourth quarter of 2021, potentially exceeding the net earnings record set in the third quarter of 2021. Demand remains robust across most end-use markets, a trend we expect will continue well into 2022. Backlogs in our steel mills and steel products segments remain elevated compared to historical levels.

We expect the profitability of the steel mills segment to improve in the fourth quarter of 2021 as compared to the third quarter of 2021, driven by additional earnings growth at our sheet and plate mills. We expect the profitability of the steel products segment to increase in the fourth quarter of 2021 compared to the third quarter of 2021. The raw materials segment's earnings in the fourth quarter of 2021 are expected to decrease compared to the third quarter of 2021 due primarily to margin compression at our direct reduced iron 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 21, 2021 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; steel grating; and wire and wire mesh. Nucor, through The David J. Joseph Company, 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. 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 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 surrounding the global economy, including excess world capacity for steel production; (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; and (14) 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 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, 2020. 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. 2, 2021


Oct. 3, 2020


Percent Change


Oct. 2, 2021


Oct. 3, 2020


Percent Change

Steel mills total shipments:













Sheet


2,789


2,469


13%


8,629


7,345


17%

Bars


2,350


2,119


11%


7,092


6,092


16%

Structural


738


553


33%


2,042


1,754


16%

Plate


605


424


43%


1,800


1,472


22%

Other


61


61


-


258


230


12%



6,543


5,626


16%


19,821


16,893


17%














Sales tons to outside customers:













Steel mills


5,144


4,442


16%


15,690


13,382


17%

Joist


190


153


24%


529


406


30%

Deck


139


129


8%


404


365


11%

Cold finished


123


99


24%


383


300


28%

Rebar fabrication products


323


328


-2%


943


948


-

Piling


144


186


-23%


451


522


-14%

Tubular products


272


280


-3%


791


816


-3%

Other steel products


116


92


26%


325


278


17%

Raw materials


721


658


10%


2,314


2,016


15%



7,172


6,367


13%


21,830


19,033


15%

Condensed Consolidated Statements of Earnings (Unaudited)


(In thousands, except per share data)





















Three Months (13 Weeks) Ended



Nine Months (39 Weeks) Ended




Oct. 2, 2021



Oct. 3, 2020



Oct. 2, 2021



Oct. 3, 2020


Net sales


$

10,313,223



$

4,927,960



$

26,119,527



$

14,879,603


Costs, expenses and other:

















Cost of products sold



6,906,950




4,425,765




18,617,314




13,370,181


Marketing, administrative and other expenses



526,345




165,513




1,204,539




460,922


Equity in (earnings) losses of unconsolidated affiliates



(32,464)




(479)




(65,106)




14,422


Losses on assets



-




6,604




50,970




299,450


Interest expense, net



43,285




40,139




118,709




116,856





7,444,116




4,637,542




19,926,426




14,261,831


Earnings before income taxes and noncontrolling interests



2,869,107




290,418




6,193,101




617,772


Provision for income taxes



645,842




67,788




1,410,863




207,610


Net earnings



2,223,265




222,630




4,782,238




410,162


Earnings attributable to noncontrolling interests



95,522




29,215




205,195




87,535


Net earnings attributable to Nucor stockholders


$

2,127,743



$

193,415



$

4,577,043



$

322,627


Net earnings per share:

















Basic


$

7.29



$

0.63



$

15.37



$

1.06


Diluted


$

7.28



$

0.63



$

15.34



$

1.06


Average shares outstanding:

















Basic



290,510




303,394




296,431




303,072


Diluted



291,152




303,441




296,928




303,099


Condensed Consolidated Balance Sheets (Unaudited)


(In thousands)













Oct. 2, 2021



Dec. 31, 2020


ASSETS









Current assets:









Cash and cash equivalents


$

1,764,293



$

2,639,671


Short-term investments



247,247




408,004


Accounts receivable, net



4,087,293




2,298,850


Inventories, net



5,678,715




3,569,089


Other current assets



346,277




573,048


Total current assets



12,123,825




9,488,662


Property, plant and equipment, net



7,777,277




6,899,110


Restricted cash and cash equivalents



281,345




115,258


Goodwill



2,787,992




2,229,672


Other intangible assets, net



1,171,292




668,021


Other assets



807,748




724,671


Total assets


$

24,949,479



$

20,125,394


LIABILITIES









Current liabilities:









Short-term debt


$

102,737



$

57,906


Current portion of long-term debt and finance lease obligations



615,130




10,885


Accounts payable



1,870,035




1,432,159


Salaries, wages and related accruals



1,323,365




462,727


Accrued expenses and other current liabilities



886,332




664,183


Total current liabilities



4,797,599




2,627,860


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



4,949,945




5,271,789


Deferred credits and other liabilities



1,251,643




993,884


Total liabilities



10,999,187




8,893,533


EQUITY









Nucor stockholders' equity:









Common stock



152,061




152,061


Additional paid-in capital



2,131,514




2,121,288


Retained earnings



15,561,261




11,343,852


Accumulated other comprehensive loss,
net of income taxes



(85,901)




(118,861)


Treasury stock



(4,336,415)




(2,709,675)


Total Nucor stockholders' equity



13,422,520




10,788,665


Noncontrolling interests



527,772




443,196


Total equity



13,950,292




11,231,861


Total liabilities and equity


$

24,949,479



$

20,125,394


Condensed Consolidated Statements of Cash Flows (Unaudited)


(In thousands)













Nine Months (39 Weeks) Ended




Oct. 2, 2021



Oct. 3, 2020


Operating activities:









Net earnings


$

4,782,238



$

410,162


Adjustments:









Depreciation



546,619




525,688


Amortization



76,656




62,877


Stock-based compensation



97,652




56,122


Deferred income taxes



166,748




140,606


Distributions from affiliates



200




3,021


Equity in (earnings) losses of unconsolidated affiliates



(65,106)




14,422


Losses on assets



50,970




299,450


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









Accounts receivable



(1,622,668)




37,547


Inventories



(1,976,738)




590,434


Accounts payable



343,014




15,366


Federal income taxes



262,195




18,848


Salaries, wages and related accruals



835,381




(69,235)


Other operating activities



123,202




100,283


Cash provided by operating activities



3,620,363




2,205,591


Investing activities:









Capital expenditures



(1,207,088)




(1,179,081)


Investment in and advances to affiliates



(193)




(16,542)


Disposition of plant and equipment



15,581




19,492


Acquisitions (net of cash acquired)



(1,346,608)




(20,368)


Purchase of investments



(394,141)




(401,986)


Proceeds from the sale of investments



554,898




301,249


Other investing activities



1,042




(33,536)


Cash used in investing activities



(2,376,509)




(1,330,772)


Financing activities:









Net change in short-term debt



44,831




1,334


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



196,990




1,237,635


Repayment of long-term debt



-




(97,150)


Bond issuance related costs



-




(6,250)


Proceeds from exercise of stock options



143,874




-


Payment of tax withholdings on certain stock-based compensation



(71,494)




(17,691)


Distributions to noncontrolling interests



(120,619)




(106,193)


Cash dividends



(366,606)




(368,636)


Acquisition of treasury stock



(1,773,848)




(39,499)


Other financing activities



(7,993)




(6,983)


Cash (used in) provided by financing activities



(1,954,865)




596,567


Effect of exchange rate changes on cash



1,720




(7,790)


Increase in cash and cash equivalents and restricted cash and cash equivalents



(709,291)




1,463,596


Cash and cash equivalents and restricted cash and cash equivalents - beginning of year



2,754,929




1,534,605


Cash and cash equivalents and restricted cash and cash equivalents - end of nine months


$

2,045,638



$

2,998,201


Non-cash investing activity:









Change in accrued plant and equipment purchases


$

14,997



$

-


Cision
Cision

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SOURCE Nucor Corporation