US steel producer Nucor Corporation has announced guidance for its second quarter ending July 4, 2020. Accordingly, Nucor expects its second quarter earnings to be in the range of $0.10 to $0.15 per diluted share. This range is an increase compared to earnings in the first quarter of 2020 of $0.07 per diluted share and a decrease compared to earnings in the second quarter of 2019 of $1.26 per diluted share.
In a press release, the company stated that its second quarter performance has been better than expected. "Though overall market conditions are still challenged by the pandemic, demand in nonresidential construction has been resilient during this time," the company said.
Nucor stated that its downstream steel products segment is having another strong quarter, and that in the steel mills segment its sheet and plate mills have been negatively affected by the coronavirus pandemic and this situation stemmed from the weak oil and gas market activity and customer production disruptions.
The company noted that it is currently seeing a strong rebound in steel demand from the automotive sector despite the production halts in the domestic market caused by the coronavirus. Nucor said, “The automotive industry experienced better than expected sales during their outage period, resulting in low inventory levels as we enter the third quarter of 2020.”
According to the company, its raw materials segment has been challenged by decreased pricing for raw materials and the halt at its direct reduced iron (DRI) facility in Trinidad.
Nucor said that it believes it will navigate any future challenges that arise from these current situations via its advantaged cost position, flexible production capability and financial strength.