Nucor Corporation today announced guidance for its first quarter ending April 4, 2020. Nucor expects first quarter earnings to be in the range of $0.95 to $1.00 per diluted share. This range is an increase compared to fourth quarter of 2019 earnings of $0.35 per diluted share and a decrease compared to first quarter of 2019 earnings of $1.63 per diluted share.
In a press release, the company said it expects earnings in the steel mills segment to increase in the first quarter of 2020 as compared to the fourth quarter of 2019 (excluding the fourth quarter of 2019 impairment charge), due to increased average selling prices, primarily at the sheet, bar and plate mills, and expected higher volumes.
Nucor expects the profitability of the steel products segment in the first quarter of 2020 to decrease as compared to the fourth quarter of 2019 (excluding the fourth quarter of 2019 impairment charges) due to normal seasonality.
The company expects the performance of the raw materials segment to increase in the first quarter of 2020 as compared to the fourth quarter of 2019, due to an improvement in pricing for raw materials, the absence of the impairment charge related to producing natural gas well assets and improved performance at Nucor’s DRI facilities.
The company said order rates, backlogs and utilization rates at its steel mills have remained strong well into March, “which reflects strong underlying demand in nonresidential construction and other end-use markets.”
Nucor said that so far, the impacts of COVID-19 on its supply chains and operations has been minimal. However, the company cautioned that more severe impacts are probable as economic activity is disrupted by construction sites being shut down in some major cities and other business interruptions. Nucor said it is too early to gauge how significant those impacts will be for the balance of the year, and the company is carefully monitoring the evolving situation.