Nucor Reports Results for Year Ended 2012
OREANDA-NEWS. February 04, 2013. Nucor Corporation (NYSE: NUE) announced consolidated net earnings of USD 504.6 million, or USD 1.58 per diluted share, for the full year 2012, compared with consolidated net earnings of USD 778.2 million, or USD 2.45 per diluted share, for the full year 2011, reported the press-centre of Nucor.
Nucor reported consolidated net earnings of USD 136.9 million, or USD 0.43 per diluted share, for the fourth quarter of 2012. By comparison, Nucor reported net earnings of USD 110.3 million, or USD 0.35 per diluted share, in the third quarter of 2012 and net earnings of \\$137.1 million, or USD 0.43 per diluted share, in the fourth quarter of 2011.
Nucor recorded a credit to value inventories using the last-in, first-out (LIFO) method of accounting of USD 155.9 million (USD 0.31 per diluted share) for the full year 2012, compared with a charge of USD 142.8 million (USD 0.28 per diluted share) for the full year 2011. The LIFO credit in the fourth quarter of 2012 was USD 71.9 million (USD 0.14 per diluted share), compared with a credit of USD 84.0 million (USD 0.16 per diluted share) in the third quarter of 2012 and a charge of USD 51.8 million (USD 0.11 per diluted share) in the fourth quarter of 2011.
Non-cash inventory related purchase accounting charges associated with our acquisition of Skyline Steel LLC decreased to USD 12.0 million (USD 0.02 per diluted share) in the fourth quarter of 2012 compared to USD 28.2 million (USD 0.06 per diluted share) in the third quarter of 2012. The full year 2012 Skyline purchase accounting charges were approximately USD 48.8 million (USD 0.10 per diluted share).
Third quarter of 2012 results also included a loss on the sale of the assets of Nucor Wire Products Pennsylvania, Inc. of USD 17.6 million (USD 0.04 per diluted share). Fourth quarter of 2011 results were impacted by a non-cash gain of USD 29.0 million (USD 0.06 per diluted share) for the correction of an actuarial calculation related to the medical plan covering certain eligible early retirees.
For the full year 2012, Nucor's consolidated net sales decreased 3% to USD 19.43 billion, compared with USD 20.02 billion for 2011. Average sales price per ton decreased 3% from full year 2011. Total tons shipped to outside customers were 23,092,000 tons, a slight increase from 2011 levels.
Nucor's consolidated net sales decreased 7% to USD 4.45 billion in the fourth quarter of 2012 compared with USD 4.80 billion in the third quarter of 2012 and decreased 8% compared with USD 4.83 billion in the fourth quarter of 2011. Average sales price per ton decreased 2% from the third quarter of 2012 and decreased 4% from the fourth quarter of 2011. Total tons shipped to outside customers were 5,478,000 tons in the fourth quarter of 2012, a 5% decrease from the third quarter of 2012 and a 4% decrease from the fourth quarter of 2011.
The average scrap and scrap substitute cost per ton used for the full year 2012 was USD 407, a decrease of 7% from USD 439 in 2011. The average scrap and scrap substitute cost per ton used in the fourth quarter of 2012 was USD 372, a decrease of 2% from USD 380 in the third quarter of 2012 and a decrease of 16% from USD 441 in the fourth quarter of 2011.
Overall operating rates at our steel mills were 74% for the full year 2012, which is consistent with 2011 and an increase from 70% in 2010. Steel mill utilization rates in the fourth quarter of 2012 (71%) were flat when compared with the third quarter and with last year's fourth quarter.
For the full year 2012, total energy costs decreased approximately USD 2 per ton from the prior year primarily due to lower natural gas unit costs. In the fourth quarter of 2012, total energy costs decreased approximately USD 2 per ton from the third quarter of 2012, and decreased slightly from the fourth quarter of 2011 primarily due to lower electricity unit costs.
Construction is going well on our 2,500,000-ton DRI facility in Louisiana. The majority of the equipment arrived in 2012, and we are on schedule for start-up in mid-2013.
Our liquidity position remains strong with USD 1.43 billion in cash and cash equivalents, short-term investments, and restricted cash and investments. Our USD 1.5 billion revolving credit facility that matures in December 2016 remains unused.
In December, Nucor's board of directors declared a cash dividend of USD 0.3675 per share payable on February 11, 2013 to stockholders of record on December 31, 2012. This dividend is Nucor's 159th consecutive quarterly cash dividend, a record we expect to continue.
Fourth quarter earnings of USD 0.43 per share were significantly better than our quantitative guidance of between USD 0.25 and USD 0.30 per share. This improved performance was due to better than expected operating profits, primarily at our sheet, plate and beam mills, and a larger than expected LIFO credit. We currently expect to see first quarter 2013 earnings below our results in the fourth quarter of 2012. This reflects our expectation of level operating performance and a reversal of LIFO from a large credit in the fourth quarter of 2012 to a small charge in the first quarter of 2013. Construction markets are showing some small improvement but remain at historically anemic levels. The strongest end markets continue to be manufactured goods including automotive, energy and heavy equipment. High import levels, volatility in raw material costs and general economic uncertainty are all factors that could undermine our expectations.
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 piling; steel joists and joist girders; steel deck; fabricated concrete reinforcing steel; cold finished steel; steel fasteners; metal building systems; steel grating and expanded metal; and wire and wire mesh. Nucor, through The David J. Joseph Company, 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," "could" 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; and (4) competitive pressure on sales and pricing, including competition from imports and substitute materials. These and other factors are outlined in Nucor's regulatory filings with the Securities and Exchange Commission, including those in Nucor's December 31, 2011 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.
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