Steel Mills
SDI Sales and Earnings Rise in Q2
Written by Sandy Williams
July 22, 2014
Steel Dynamics announced net income of $72 million in second quarter 2014 on net sales of $2.1 billion. In comparison, second quarter 2013 net income was $29 million and sequential quarter net income was $39 million. Sales were 13 percent higher both year over year and sequentially. All reporting segments showed higher profitability after the negative weather impact of the first quarter.
Quarterly steel shipments were at record levels. Sheet steel shipments were up 21 percent, structural beam 14 percent, and rail 22 percent compared to Q1 2014. Total steel shipments for Q2 2014 were 1.678 million tons. Production for second quarter totaled 1.7 million tons. Average price per ton for the quarter was $833. The steel mill utilization rate improved by 9 percent across all of SDI’s mills.
Metals recycling and ferrous resources operations from OmniSource and the Minnesota iron producing operations totaled sales of $1.0 million with external sales of $645,216.
In the earnings conference call today, CEO Mark Millet said the market today was positive from a “pricing standpoint and potential” and the “current environment is sustainable.” On scrap prices, Millet said “given that the export market is not incredibly strong, we expect scrap to be sideways or edge down a few bucks.”
The Severstal Columbus acquisition for $1.625 billion is expected to be immediately accretive to earnings and cash flow per share. SDI anticipates synergies of $30 million. The acquisition will increase SDI’s steel production capacity by more than 40 percent while not adding new capacity to the market.
The Columbus mill is a complement to SDI’s Butler facility, said Millet, and has the potential to match or exceed Butler’s production.
Sandy Williams
Read more from Sandy WilliamsLatest in Steel Mills
August US mill shipments slip but still higher than last year
The American Iron and Steel Institute reported a decline in the monthly shipments of US mills from July to August.
TransPod, Algoma, Supreme Steel linkup anchors Canadian steel in high-speed transit build
The three Canadian companies have announced a strategic partnership to support the development of an ultra-high-speed transit line from Edmonton to Calgary.
Metallus, USW agree to tentative four-year labor deal
Metallus and the United Steelworkers (USW) have agreed to a tentative four-year labor contract.
ArcelorMittal Dofasco resumes cokemaking after emergency maintenance
The Canadian steelmaker reported on Sept. 30 that “urgent maintenance” was needed in its coke plant off-gas systems. The work required coke oven gas from the No. 2 coke plant to be flared for most of that week.
AISI: Raw steel production ticks back down
US raw steel output declined last week after increasing the week prior, according to the latest data from the American Iron and Steel Institute (AISI). Output has see-sawed from week to week since mid-August. Still, it has remained historically strong over the past four months and has held near multi-year highs since June. Domestic mills […]