Steel Dynamics, Inc. announced third quarter 2015 net income of $61 million, or $0.25 per diluted share, on net sales of $2.0 billion. Comparatively, prior year third quarter net income was $91 million, or $0.38 per diluted share, on net sales of $2.3 billion, and sequential second quarter 2015 net sales were $2.0 billion, with adjusted net income of $53 million, or $0.22 per diluted share, which excluded expenses of $0.09 per diluted share associated with both idling the company's Minnesota operations and planned furnace maintenance at Iron Dynamics.
"The third quarter 2015 market environment continued to be challenging for our steel and metals recycling operations," said Mark D. Millett, Chief Executive Officer. "Ongoing pressure from steel imports remains high, negatively impacting steel pricing and domestic steel production, resulting in industry utilization not fully reflecting the actual strength in U.S. steel consumption. The automotive market remains strong and construction continues its steady improvement. However, customer steel inventories remain at elevated levels and when combined with further declining scrap prices, have resulted in hesitant ordering. As scrap prices stabilize at these lower levels and steel inventories moderate to more normalized quantities into 2016, we believe domestic steel production should improve.
"An important barometer for domestic steel consumption is the strength of the construction industry. Historically, the construction industry has been the largest single domestic steel consuming sector, and it is continuing on an upward trend," continued Millett. "For the second consecutive quarter, our fabrication operations achieved record profitability. Steady demand resulted in a 17 percent increase in third quarter 2015 fabrication shipments and orders remain robust, reflecting the steady positive trend in the non-residential construction market. Our fabrication operating profitability has increased $56 million, or 184 percent, so far this year, when compared to 2014.
"Despite the headwind from imports, we achieved a nine percent improvement in third quarter 2015 operating income, as compared to sequential second quarter 2015 adjusted operating income (excluding the idled Minnesota Operations and the Iron Dynamics outage impact), based on record fabrication performance and a 25 percent improvement in our steel segment profitability," concluded Millett.