Nucor Corporation announced Wednesday guidance for its third quarter ending October 4, 2014, expecting results to be in the range of $0.70 to $0.75 per diluted share, which represents an increase from both the third quarter of 2013 and second quarter of 2014 earnings of $0.46 per diluted share. This performance is consistent with the company’s expectations supporting the qualitative guidance presented in its second quarter of 2014 earnings release and conference call which stated, "We currently expect to see a stronger improvement in earnings for the third quarter of 2014."
Overall operating performance at Nucor’s steel mills segment for the third quarter is expected to be much improved compared to the second quarter of 2014, as the company expects increased profitability in sheet, structural, bar and plate steel. Structural steel had no major outages in the third quarter, as compared to the planned three week outage at Nucor-Yamato Steel in the second quarter associated with the $115 million sheet piling capital project. The strongest markets for the steel mills continue to be manufactured goods, including energy and automotive. Though third quarter results are expected to be much improved from the second quarter, imports remain at high levels, applying downward pressure on pricing.
The performance of the fabricated construction products businesses (rebar fabrication, joist and decking and pre-engineered metal buildings) is expected to improve compared to the second quarter of 2014, reflecting improving conditions in the nonresidential construction markets. Although nonresidential construction markets are at historically low levels, they are improving, the statement said.
The performance of Nucor’s raw materials segment includes an anticipated operating loss of $27 million at the new direct reduced iron (DRI) plant in St. James Parish, Louisiana. An additional factor affecting the performance of Nucor Steel Louisiana is the impact of consuming higher cost iron ore purchased early in the year under a quarterly lag pricing mechanism.