Charlotte, North Carolina-based Nucor Corporation announced Thursday consolidated net earnings of $23.5 million for Q3 2010, compared with net earnings of $91.0 million in Q2 2010, and a net loss of $29.5 million, Q3 2009. In the first nine months of 2010, Nucor reported consolidated net earnings of $145.5 million, compared with a net loss of $352.5 million, in the first nine months of 2009.
In Q3 2010, Nucor's consolidated net sales decreased 1 percent from Q2 2010, but saw an increase of 33 percent compared with Q3 2009. The average sales price per ton decreased 3 percent from Q2 2010 but increased 20 percent over Q3 2009. Total tons shipped to outside customers were 5,633,000 tons in the third quarter of 2010, an increase of 1 percent over the second quarter of 2010 and an increase of 10 percent over the third quarter of 2009.
Total third quarter steel mill shipments increased 9 percent over the Q3 2009 and increased 2 percent over the Q2 2010.
In the first nine months of 2010, Nucor's consolidated net sales increased 45 percent to $11.99 billion, compared with $8.25 billion in last year's first nine months. Average sales price per ton increased 13 percent while total tons shipped to outside customers increased 29 percent over the first nine months of 2009.
Overall operating rates at Nucor's steel mills in Q3 were down 3 percent from Q2 at 68 percent. Steel mill utilization increased from 53 percent in the first nine months of 2009 to 71 percent during the same period.
During the company's quarterly conference call, Nucor discussed the selection of St. James Parish, Louisiana, for the construction of a planned $750 million iron making facility, subject to receipt of all requisite environmental permits, which the company expects to have by the end of the year. Nucor also commented that from the time of initial construction, the direct reduced iron (DRI) facility should be completed within two years. The DRI facility is the first phase of a multi-phase plan that may include an additional DRI facility, coke plant, blast furnace, pellet plant and steel mill.
Operating results deteriorated from the second quarter, primarily due to lower margins stemming from lower realized selling prices on most steel mill products and Nucor commented that the economy has entered into a period of increased volatility, both in the US and globally and that the fourth quarter may indeed turn out to be the most challenging quarter of the year.
Later in the call, when questioned about current order books, Nucor said that "order entry rates are very short-term based," with orders being placed one day and being shipped out in just a couple of weeks. Exact order numbers were not mentioned however Nucor did say that the rates are down for Q2, and right now it is the long products business that is faring better than the flat-rolled.
Dan DiMicco, Chairman, President and CEO of Nucor went on to say that overall, the company has seen a "general slowdown across all product lines," but the residential and non-residential construction markets continue to show little, if any strength and remain Nucor's biggest challenge.