Nucor 1Q Profit Rises 4.4%, Expects Improved 2Q Performance

Nucor Corporation

said that its consolidated net earnings rose 4.4% to $70.8 million in the first quarter from $67.8 million in the year-ago quarter. Similarly, its earnings rose 4.7% to $0.22 a share from $0.21 a share in the comparable period. Its first quarter results included a charge of $27.5 million or $0.05 per share to value inventories using the last-in, first-out (LIFO) method of accounting. Excluding charges, it would have earned $0.27 a share, which was in line with the Street expectations. Nucor's consolidated net sales dropped 16% to $3.72 billion from $4.40 billion in the previous year quarter though it recorded 7% Growth from the fourth quarter's $3.46 billion. The company blamed it on average sales price per ton witnessing a 23% drop from the first quarter of 2015 and 11% drop from the fourth quarter of 2015. The company's total tons shipped to outside customers were 6.148 million tons in the first quarter representing a 9% increase from the first quarter of 2015 and a 20% increase from the fourth quarter of 2015. Moving ahead, Nucor's press stated that "We expect earnings in the second quarter of 2016 to be significantly improved from the first quarter of 2016. Performance of the steel mills segment is expected to improve in the second quarter of 2016 as compared to the first quarter of 2016 as recently announced price increases for many of our products are being accepted in the market. This improved performance by the steel mills segment in the second quarter of 2016 will be tempered by rising scrap prices." The company's statement added that "We expect increased profitability for our downstream products segment in the second quarter of 2016 as compared to the first quarter of 2016 due to seasonal factors as improving weather conditions benefit nonresidential construction markets. The performance of the raw materials segment is expected to improve in the second quarter of 2016 as compared to the first quarter of 2016 due to improved pricing at both our scrap processing businesses and DRI facilities." On Thursday, the stock traded down by 0.6%.