NEW YORK Nucor Corp.s net income jumped 33.8 percent year on year in the third quarter on improved profitability in its sheet and structural steel divisions.
A 17-day planned outage in the second quarter and customer inventory restocking at its Nucor-Yamato Steel Co. facility in Blytheville, Ark., also helped boost profits, the Charlotte, N.C.-based steelmaker said Oct. 17.
However, earnings for the three months ended Sept. 28 were negatively affected by a net $14-million partial write-down of inventory and fixed assets related to the collapse of a storage dome at its St. James Parish, La., direct-reduced iron facility (amm.com, Sept. 26). While there was no environmental impact, Nucor said the incident would delay the start-up of operations until year-end.
Steel mill shipments totaled 5.36 million tons in the third quarter, up 6 percent from a year earlier and 7 percent higher sequentially. Downstream steel product shipments to outside customers fell 4 percent year on year but rose 2 percent vs. the second quarter.
In its raw materials segment, Nucors scrap and scrap substitute cost per ton was $372 in the quarter, down 1 percent from $377 per ton in the second quarter and off 2 percent from $380 per ton a year earlier.
Overall operating rates in the third quarter jumped to 78 percent from 73 percent in the preceding quarter and 71 percent in the same period a year earlier.
Quarterly net income of $147.6 million rose from $110.3 million a year earlier and was 73.3 percent higher than the $85.15 million reported in the second quarter, the company said. Net sales of $4.94 billion rose 2.9 percent from $4.8 billion a year earlier and gained 5.9 percent from $4.67 billion in the second quarter.
Nucor reported diluted earnings per share of 46 cents for the third quarter, beating its projections of 35 to 40 cents per share (amm.com, Sept. 17).
Looking forward, the company expects profitability to remain stabile despite a slowdown in the fourth quarter.
"Although we expect stability in metal margins, we typically experience lower shipping volumes in the fourth quarter due to seasonal factors," it said, citing a number of planned outages for previously announced expansions. "As a result, we currently expect to see moderately lower earnings for the fourth quarter of 2013."