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Nucor Annual Report, Year Ended Dec 31, 2001

Filing Date
Filed March 22, 2002
Period End
December 31, 2001
Security
NUE
In the record · 2016–202610-K1110-Q328-K111

NUE filed 11 annual reports (10-K), 32 quarterly reports (10-Q) and 111 current reports (8-K) between 2016 and 2026.

  1. FY2016 annual report10-K · Feb ’17Feb ’17
  2. Deal closed8-K · Jul ’19Jul ’19
  3. Leadership change8-K · Mar ’22Mar ’22
  4. Leadership change8-K · Dec ’25Dec ’25

01—Abstract

Summary

Summary of the 10-K filed March 22, 2002. Cited figures are marked; the original filing is the authoritative source.

Nucor Corporation's 2001 annual report on Form 10-K shows a sharp earnings decline driven by weak steel pricing.

Net sales fell 10% to $4.14 billiona from $4.59 billion in 2000, as the composite sales price per ton dropped 18% to $338 from $410, which management attributes to the continued flood of imports and the economic downturn. Net earnings fell to $112.96 million, or $1.45 per share, from $310.9 million, or $3.80 per share, in 2000. Gross margin narrowed to 8% from 14%, and pre-operating and start-up costs rose to $97.8 million from $50.9 million, mainly related to the new plate mill in North Carolina and the Vulcraft facility in New York.

Earnings included a $20.2 millionb pre-tax gain from the sale of Nucor Iron Carbide. Record steel shipments of 12.1 million tons and record sales to outside customers of 11.03 million tons partially offset the price decline. The balance sheet remained strong, with cash and short-term investments of $462.3 million, working capital of $889.5 million, a current ratio of 2.8, and long-term debt of $460.5 million.

Operating cash flow fell to $495.1 millionc from $820.8 million. Capital expenditures were $261.1 million in 2001, and management projects them to be below $200 million in 2002. The company also disclosed acquisitions of Auburn Steel's bar facility for about $115 million and ITEC Steel, plus a pending purchase of Trico Steel's sheet mill for about $120 million and a $500 million offer for Birmingham Steel's assets.

Management cites the presidential steel tariffs announced in March 2002 as a key factor for 2002, and warns that the past year was among the toughest the steel industry has faced in decades. For investors, the filing describes a company that is leaving the 2001 downturn with a conservative capital structure and a growing asset base, while earnings are highly sensitive to import levels, the construction economy, and the tariff remedy. Management expects above-average earnings from steelmaking over time but notes that external factors will significantly affect results.

02—Key points

Key Highlights

  1. Net sales fell 10% to $4.14 billion in 2001 from $4.59 billion in 2000, as composite sales price per ton dropped 18% to $338 from $410.
  2. Net earnings declined to $112.96 million ($1.45 per share) from $310.9 million ($3.80 per share), including a $20.2 million pre-tax gain on the sale of Nucor Iron Carbide.
  3. Gross margin fell to 8% from 14%, with pre-operating and start-up costs rising to $97.8 million from $50.9 million.
  4. Record steel shipments of 12.1 million tons and record steel sales to outside customers of 11.03 million tons in 2001.
  5. Balance sheet remains strong: working capital of $889.5 million, current ratio of 2.8, and $462.3 million in cash and short-term investments against $460.5 million of long-term debt.
  6. Operating cash flow dropped to $495.1 million from $820.8 million; capital expenditures were $261.1 million, with 2002 projected below $200 million.
  7. Pending acquisitions include Trico Steel's sheet mill for about $120 million and a $500 million offer for Birmingham Steel's assets; a Castrip thin-strip facility is expected to start up in Q2 2002.

03—Questions

Frequently Asked Questions

  1. Why did Nucor's earnings decline so sharply in 2001?

    Management attributes the decline primarily to an 18% drop in composite sales price per ton, driven by the continued flood of imports and the economic downturn. Gross margins also fell to 8% from 14%, and pre-operating and start-up costs for new facilities rose to $97.8 million.

  2. How is Nucor's balance sheet positioned going into 2002?

    At December 31, 2001, Nucor had working capital of $889.5 million, a current ratio of 2.8, and cash and short-term investments of $462.3 million. Long-term debt was $460.5 million, and the company had $248 million of unused long-term credit facilities.

  3. What did the filing say about the steel import tariffs?

    President Bush imposed tariffs in March 2002 over a three-year period, beginning at 30% for many steel products and then declining in years two and three. Management said the tariffs should reduce illegal imports but that the remedy is only the beginning of a long-term solution, and that Nucor will remain diligent in its implementation.

  4. What growth moves did Nucor make in 2001 and early 2002?

    Nucor bought Auburn Steel's bar facility in New York for about $115 million and acquired ITEC Steel for about $11 million including liabilities. It also agreed to purchase substantially all of Trico Steel's sheet mill for about $120 million, with closing expected in the third quarter of 2002, and made a $500 million offer for Birmingham Steel's assets.

  5. What does management expect for 2002?

    Management expects 2002 earnings to be affected by the state of the economy, particularly construction, and by the import remedy. Capital expenditures are projected to be less than $200 million, and the Vulcraft Group expects continued weakness in building construction to hurt its sales and earnings.

04—Continue

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