NEW YORK Nucor Corp. expects third-quarter earnings to benefit from a combination of improved sheet margins, customer inventory restocking and strong energy and automotive end markets, the company said Sept. 17.
The Charlotte, N.C.-based steelmaker pegged third-quarter diluted earnings per share in the range of 35 to 40 cents compared with 27 cents in the second quarter and 35 cents in the year-ago quarter.
The results will include an $18-million last-in, first-out (lifo) credit. The company had recorded an $84-million lifo credit in the third quarter of 2012.
In the steel mills segment, operating performance was stronger in the sheet and structural divisions, particularly due to supply disruptions, customer inventory restocking and some market demand improvement, the company said.
"Structural steel results improved due to Nucor-Yamato Steel (Co.)s higher production following its 17-day planned outage during the second quarter and customer inventory restocking," Nucor said.
The fabricated construction products businessesreinforcing bar fabrication, joist and decking, and pre-engineered metal buildingsare also expected to show improvement vs. the second quarter.
However, Nucor anticipates weaker results in its raw materials segment during the quarter, mostly due to increased start-up costs of its direct-reduced iron (DRI) facility in Louisiana. With the facility in the final stages of hot commissioning, production is expected to begin within the next few weeks. Those increased losses will be partially offset by improved results at scrap subsidiary David J. Joseph Co., Cincinnati.
"Thus far in 2013 non-residential construction markets continue to lack sustained momentum, but they are slowly improving from historically low levels," Nucor said. "The strongest end markets continue to be in manufactured goods, including energy and automotive."