Steel Dynamics, Inc. reported second quarter 2019 net sales of $2.8 billion and net income of $194 million. Comparatively, prior year second quarter net income was $362 million, with net sales of $3.1 billion. Sequential first quarter 2019 net income was $204 million, with net sales of $2.8 billion.
In a statement, the company said the decline in earnings resulted from metal spread compression which more than offset the 3 percent increase in overall steel shipments related to the ramp-up of the Heartland facility and the recent addition of United Steel Supply.
The company said the sequential earnings decline was primarily driven by lower shipments and product pricing within the company's long product steel operations. The second quarter 2019 average external product selling price for the company's overall steel operations decreased $23 sequentially to $879 per ton. The average ferrous scrap cost per ton melted at the company's steel mills decreased $22 to $316 per ton.
As for an outlook, Mark D. Millett, President and Chief Executive Officer, said, “Based on domestic steel demand fundamentals, we are constructive concerning second half 2019 North American steel market dynamics. We believe steel consumption will experience modest growth and will be supported by further steel import reductions and the end of steel inventory destocking. There have been recent trade actions that we believe could have a positive impact in further reducing unfairly traded steel imports into the United States, including coated flat roll steel, which could have a significant positive impact for Steel Dynamics, as we are the largest non-automotive flat roll steel coater in the US.”