Nucor expects to report a net loss in Q2 2020, the company said in a statement today while releasing its Q1 financial report, citing ongoing effects of the Covid-19 pandemic.
The company has reduced capacity rates at its mills, along with idling production at its DRI facility in Trinidad on March 30. The company’s DRI facility in Louisiana shut down on April 2 and resumed operations on April 25.
Nucor said the pandemic’s impact on market conditions has been varied across product groups. The automotive and energy markets have seen the sharpest decline, while nonresidential construction—which Nucor said is its largest end-use market—has show “resiliency,” projecting the sentiment that projects would be delayed rather than cancelled. Nucor also cited a “fairly significant supply side response to the pandemic, with a number of our competitors having idled capacity in response to these challenging conditions.”
Still, while the company said the economic outlook for Q2 is “highly uncertain at present,” Nucor said it believes market conditions will “bottom” in Q2 and expects to return to profitability in the second half of the year.