Steel Dynamics, Inc. today announced fourth quarter and annual 2016 financial results. The company reported fourth quarter net sales of $1.9 billion and net income of $20 million. Comparatively, prior year fourth quarter net sales were $1.6 billion, with adjusted net income of $22 million. Sequential third quarter 2016 net sales were $2.1 billion, with adjusted net income of $160 million.
“The industry benefited this year from reduced flat roll steel imports, coupled with steady demand,” commented Mark D. Millett, President and Chief Executive Officer. “Our steel operations profitability declined significantly in the fourth quarter, as customers’ hesitancy to place orders earlier in the quarter resulted in both lower shipments and product pricing.”
The company's steel production utilization rate was 81 percent in the fourth quarter 2016, compared to 85 percent in the sequential third quarter and compared to the domestic industry utilization rate of less than 70 percent.
SDI’s annual 2016 net income was $382 million, compared to an annual net loss of $130 million in 2015. Annual 2016 net sales were $7.8 billion, compared to $7.6 billion in 2015. The company's steel and fabrication operating platforms each achieved annual shipping records in 2016 and despite lower average selling values, drove the increase in 2016 revenues.
“The company believes that current and anticipated macroeconomic and market conditions are in place to benefit the domestic steel industry in the coming year,” said Millett. “Although domestic automotive production may be coming off record levels, we believe 2017 North American automotive steel consumption will be steady, and that there will be additional growth in the construction sector, especially for larger, public sector infrastructure projects. We could also see some improved activity within the energy sector in 2017.”