Steel Mills

Nucor Q3 profit falls sharply on lower steel prices, further drop seen in Q4

Written by Ethan Bernard

October 21, 2024

Nucor Corp.

Third quarter ended Sept. 2820242023Change
Net sales$7,444.2$8,775.7-15.2%
Net earnings (loss)$249.9$1,141.5-78.1%
Per diluted share$1.05$4.57-77.0%
Nine months ended Sept. 28
Net sales$23,658.4$27,009.0-12.4%
Net earnings (loss)$1,740.0$3,739.4-53.5%
Per diluted share$7.22$14.83-51.3%
(in millions of dollars except per share)

Nucor’s profits dropped precipitously in the third quarter on lower prices in its steel mills segment, and the company expects a continued earnings slide for Q4’24.

The Charlotte, N.C.-based steelmaker posted net earnings of $249.9 million in the quarter ended Sept. 28, off 78% from $1.14 billion a year earlier. Net sales slid 15% to $7.44 billion in the same comparison.

“Nucor’s market leadership, product diversity, and strong balance sheet enable us to provide meaningful returns to shareholders and execute our growth strategy even in the face of market uncertainty,” Leon Topalian, Nucor’s chair, president and CEO, said in a statement after market close on Monday.

Steel mill segment hurts profits

The company cited a decline in average selling prices in its steel mills segment as the primary driver for decreased earnings quarter over quarter.

The average sales price per ton in Q3’24 fell 6% vs. the previous quarter and was off 15% from a year earlier.

The steel mill segment shipped 5,719,000 short tons (st) in the quarter, roughly level with 5,746,000 st in the same quarter last year. However, Nucor said shipments were down 3% sequentially.

Finally, the segment had earnings before income taxes and noncontrolling interests of $309.1 million in Q3’24, off 65% from a year earlier.

Scrap prices also declined in the quarter, the company said. The average scrap and scrap substitute cost per gross ton used in Q3’24 was $378. This was down 5% from $396 in the previous quarter and 9% from $415 in Q3’23.

Earnings also dropped sequentially in both the steel products and raw materials segments.

Outlook

Nucor expects net earnings in Q4’24 to fall from Q3’24 earnings of $1.05 per diluted share.

The primary reason: Anticipated weaker earnings in the steel mills segment caused by lower average selling prices and declining volumes.

The company expects a similar scenario in its steel products segment.

However, Nucor predicted that earnings in its raw materials segment would increase q/q (excluding an impairment charge).

Ethan Bernard

Ethan Bernard is managing editor for Steel Market Update. He previously worked for American Metal Market as a copy editor in the New York office for two years, starting in 2008. Later, he copy edited AMM’s monthly magazine on a freelance basis from 2015 until 2017. With experience in financial copywriting and textbook publishing, he holds a BA in Comparative Literature from UC Berkeley, and an MFA. in Creative Writing from New York University. He can be reached at ethan@steelmarketupdate.com or 724-759-7871.

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