NEW YORK Steel Dynamics Inc. (SDI) expects relatively
flat first-quarter earnings as the nonresidential
construction sector continues its slow climb to recovery,
even as global economic uncertainty continues to impact
consumers purchasing patterns.
The Fort Wayne, Ind.-based steel producer is projecting net
income of between 17 to 21 cents per diluted share for the
first three months of the year, compared with earnings of 20
cents per diluted share in both the fourth quarter of 2012
and the same quarter the prior year, it said in its
first-quarter guidance March 18.
SDIs steel shipments are expected to be flat quarter
over quarter due to a decrease in galvanized sheet volumes
offset by increased long product shipments, particularly in
engineered special bar quality products, standard rail and
wide-flange beams, the company said.
The company had previously said that it was optimistic about
2013 due to improvements in the residential and
nonresidential construction markets (
amm.com, Jan. 28
), and according to its March 18
forecast, that has recently started to prove true.
The global economic uncertainty continues to impact
customer confidence and buying patterns, the steelmaker
said. However, the residential construction market is
stronger, and market optimism remains in place for
improvement in nonresidential construction demand, as modest
increases in key directional indices continue to show signs
of recovery from base historical lows.
Automotive and manufacturing markets also continue to be
strong, SDI said.
Meanwhile, SDIs metals recycling armOmniSource
Corp.is expected to report a decrease in earnings in
the first quarter as anticipated increases in shipping
volumes were more than offset by decreased margins. At the
same time, the companys fabrication operations are
expected to remain profitable for the fifth consecutive
quarter, a possible sign of slowly improving
nonresidential construction activity, SDI said.