01—Abstract
Summary
Summary of the 8-K filed September 17, 2024. Cited figures are marked; the original filing is the authoritative source.
Steel Dynamics, Inc. furnished a Form 8-K on September 17, 2024, attaching a September 16, 2024 press release that provides third quarter 2024 earnings guidance of $1.94 to $1.98a per diluted share.
For comparison, the company reported second quarter 2024 earnings of $2.72b per diluted share and prior year third quarter earnings of $3.47 per diluted share. The filing furnishes the information under Item 7.01 (Regulation FD Disclosure), so it is not deemed filed for purposes of Section 18 of the Exchange Act. The guidance indicates that third quarter profitability from steel operations is expected to be meaningfully lower than second quarter results, which management attributes to lower average realized pricing in flat rolled operations, where generally 80 percent of the business is contractually based and tied to lagging pricing indices.
Metals recycling earnings are expected to be comparable to the second quarter, and steel fabrication earnings are expected to be moderately lower. Management said flat rolled steel prices stabilized and have improved in the third quarter, underlying steel demand remains steady, and the fabrication order backlog is steady, extending into the first quarter of 2025 at attractive pricing levels. The company also stated that it repurchased $307 millionc, or two percent, of its common stock in the third quarter through September 11, 2024.
It plans to release third quarter 2024 earnings after market close on October 16, 2024, with a conference call the following day at 11:00 a.m. Eastern Daylight Time.
02—Key points
Key Highlights
- Third quarter 2024 diluted EPS guidance of $1.94 to $1.98, versus $2.72 in the second quarter of 2024 and $3.47 in the prior year third quarter.
- Steel operations profitability is expected to be meaningfully lower than the second quarter, due to lower average realized flat rolled pricing; about 80 percent of that business is contractually based and tied to lagging pricing indices.
- Metals recycling earnings are expected to be comparable to the second quarter, with steady volumes offsetting marginally lower realized pricing.
- Steel fabrication earnings are expected to be moderately lower than the second quarter on a slight decline in average realized pricing; the order backlog is steady into the first quarter of 2025.
- Flat rolled steel prices stabilized in the third quarter and have improved, and underlying steel demand remains steady.
- The company repurchased $307 million, or two percent, of its common stock in the third quarter through September 11, 2024.
- Third quarter 2024 results are scheduled for release after market close on October 16, 2024, with a conference call on October 17, 2024 at 11:00 a.m. Eastern Daylight Time.
03—Questions
Frequently Asked Questions
What earnings per share range did Steel Dynamics guide to for the third quarter of 2024?
The company provided third quarter 2024 earnings guidance in the range of $1.94 to $1.98 per diluted share, according to the September 16, 2024 press release attached as Exhibit 99.1.
Why is steel segment profitability expected to decline in the third quarter?
The company expects third quarter steel profitability to be meaningfully lower than the second quarter, based on lower average realized pricing within flat rolled operations. The filing notes that generally 80 percent of this business is contractually based and tied to lagging pricing indices.
How are the other business segments expected to perform?
Metals recycling earnings are expected to be comparable to the second quarter, based on steady volumes offsetting marginally lower realized pricing. Steel fabrication earnings are expected to be moderately lower than the second quarter, based on an anticipated slight decline in average realized pricing, though its order backlog is steady into the first quarter of 2025.
What did management say about demand and outlook for 2025?
Management said underlying steel demand remains steady and current order activity is steady. It expects improved volumes in 2025 as interest rates decline and as support from the U.S. infrastructure program and onshoring positively affects demand for steel joist and deck, flat rolled and long product steels.
What capital return activity did the company disclose?
The company repurchased $307 million, or two percent, of its common stock during the third quarter through September 11, 2024. The company cited continued confidence in its earnings outlook and cash flow generation.
04—Continue