Nucor announced today guidance for its fourth quarter ending December 31, 2016, expecting results to be in the range of $0.30 to $0.35 per diluted share. This range is a decrease compared to the third quarter of 2016 consolidated net earnings of $0.84 per diluted share and a decrease compared to the fourth quarter of 2015 adjusted net earnings of $0.45 per diluted share.
The expected decline in earnings in the fourth quarter of 2016 compared to the third quarter of 2016 is primarily due to lower margins in the steel mills segment, the company said in a statement, with the most significant impact at Nucor’s sheet mills. The performance of the raw materials segment in the fourth quarter of 2016 will decline significantly compared to the third quarter of 2016, the company said, as it returns to a loss position due to lower pricing at our DRI facilities in the fourth quarter.
Nucor expects decreased profitability for the steel products segment in the fourth quarter of 2016 as compared to the third quarter of 2016 due to end of year seasonality that is typical in the fourth quarter.
In the statement, Nucor said that market conditions for the steel mills segment have been marked by volatility in sales prices and demand during 2016. Looking ahead to 2017, the company is optimistic about continued improvement in market conditions. Prices have increased throughout the fourth quarter at the company’s sheet, bar, structural and plate mills. Scrap and other commodities prices have been increasing near the end of the year, and service center inventory levels remain low. Nucor said it believes “higher input costs and declining imports are now causing the market to find an improved and more sustainable level that we expect to benefit 2017.”