Steel Mills
SDI Earnings Guidance: Record Quarterly Performance Expected
Written by Brett Linton
September 15, 2021
Steel Dynamics Inc. (SDI) forecasts a new quarterly record in the third quarter of 2021 when it comes to steel operations’ profitability, according to guidance issued Wednesday.
The gains versus second-quarter results come thanks to strong steel demand and significant metal spread expansion, the electric-arc furnace (EAF) steelmaker said.
“Third-quarter 2021 steel shipments are expected to be strong across the company’s steel portfolio. Domestic steel demand remains strong, with the automotive, construction, and industrial sectors continuing to lead the momentum,” SDI said. “Order entry continues to be robust as strong demand, coupled with continuing low flat roll steel inventories, underpins elevated steel selling values.”
SDI believes this momentum will continue and result in even stronger fourth-quarter results.
The company expects its third-quarter earnings from metals recycling operations to be aligned with sequential second-quarter results based on higher ferrous metal margins offsetting lower volume. As many domestic steel mills have planned maintenance outages in the fourth quarter, SDI anticipates ferrous scrap demand to moderate in line with reduced steel production.
SDI provided third-quarter 2021 earnings guidance of $4.78 to $4.82 per diluted share. Excluding the impact from costs associated with its new mill in Sinton, Texas, of approximately $30 million, the company expects third-quarter adjusted earnings in the range of $4.88 to $4.92 per diluted share. Recall that the company’s sequential second-quarter 2021 earnings were $3.32 per diluted share and adjusted earnings were $3.40 per diluted share.
SDI, one of the largest steelmakers and metals recyclers in the United States, produces hot roll, cold roll and coated sheet steel, structural steel beams and shapes, rail, engineered special-bar-quality steel, cold finished steel, merchant bar products, specialty steel sections, and steel joists and deck. In addition, the company produces liquid pig iron and processes and sells ferrous and nonferrous scrap.
By Brett Linton, Brett@SteelMarketUpdate.com
Brett Linton
Read more from Brett LintonLatest in Steel Mills
Hot-rolled coil market remains slow, market participants say
Hot rolled spot market participants reported another week of moderate demand and ample supply, with no strong signs that conditions will change next week.
CRU: Blackout knocks out ArcelorMittal mill ‘for months’
Truchas works in Lazaro Cadenas, Michoacan, western Mexico. Repairs may take up to six months.
Nippon Steel posts quarterly loss on cost to buy U.S. Steel
Nippon Steel earnings take hit from buy of U.S. Steel.
Atlas completes Evraz NA deal, renames firm, and hires former USS exec as CEO
Atlas Holdings has completed its acquisition of Evraz North America (Evraz NA) and its subsidiaries.
ArcelorMittal: As tariffs slow global growth, Calvert could be a bright spot
ArcelorMittal expects less demand growth across most of the markets it operates in, including the US, because of President Donald Trump’s tariffs. But the Luxembourg-based steelmaker also thinks it stands to benefit from an increasingly regionalized world thanks to investments like the new EAF at its mill in Calvert, Ala.