Steel Dynamics, Inc. today announced first quarter 2022 financial results. The company reported first quarter 2022 net sales of $5.6 billion and net income of $1.11 billion.
Comparatively, the company's sequential fourth quarter 2021 earnings were $1.09 billion, and prior year first quarter earnings totaled $438.8 million.
In a press release, Steel Dynamics said first quarter 2022 operating income for the company's steel operations remained strong at $1.2 billion, but lower than record sequential fourth quarter results of $1.4 billion. The decline in earnings resulted from metal spread compression within the company's flat roll operations, as hot roll coil pricing moderated, the company said. Alternatively, pricing and metal spreads expanded within the company's long product steel businesses. The first quarter 2022 average external product selling price for the company's steel operations decreased just over $100 sequentially to $1,561 per ton. The average ferrous scrap cost per ton melted at the company's steel mills decreased $16 sequentially to $474 per ton.
The company's steel fabrication operations reported record operating income of $467 million in the first quarter 2022, almost double sequential fourth quarter results, as significantly higher selling values and strong shipments, more than offset marginally higher steel input costs. The non-residential construction sector remains strong, SDI said, resulting in a record order backlog with record forward-pricing for the company's steel fabrication platform. The company anticipates this momentum to continue through 2022 based on these dynamics.
As for an outlook, Mark D. Millett, Chairman, President, and Chief Executive Officer, commented, "We remain confident that market conditions are in place for domestic steel consumption to continue to be strong this year and into 2023. Order entry activity continues to be robust across all of our businesses. We believe steel prices will remain supported by strong demand, balanced customer inventory levels, and elevated raw material costs. We believe the automotive, industrial, and energy sectors will remain solid steel consumers this year, with demand from the construction sector at the lead. Our steel fabrication operations order backlog remains at record volume and forward pricing levels. This combined with continued robust order activity and broad customer optimism, supports strong overall demand dynamics for the construction industry. We believe this overall momentum will continue and that our second quarter 2022 consolidated earnings should represent another record quarterly performance.”