SDI reports 1Q profits, but down from 2018
SDI reports 1Q profits, but down from 2018
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Fort Wayne, Indiana-based electric arc furnace (EAF) steelmaker Steel Dynamics Inc. (SDI) has announced first quarter 2019 sales of $2.8 billion and net income of $204 million, or 91 cents per share. That compares to first quarter 2018 net income of $228 million, or 96 cents per share, on sales of $2.6 billion.
The results also were down from 2018 fourth quarter income of $270 million, or $1.17 per share. “The team delivered a strong first quarter performance in a somewhat challenging flat-roll steel pricing environment,” says Mark D. Millett, SDI’s president and CEO. “A downward trend in flat-roll steel prices began in the second half of 2018, and continued through mid-first quarter 2019, reaching an inflection point in February 2019.“
Millett says SDI was able to increase shipments in the first quarter of 2019 “and offset some of the margin compression, resulting in first quarter 2019 consolidated operating income of $292 million and adjusted EBITDA [earnings before interest, tax, depreciation and amortization] of $382 million.”
Also in the first quarter, SDI says its average product selling price within its steel operations decreased by $38 to $902 per ton. Meanwhile, the average ferrous scrap cost per ton melted decreased by just $5 per ton to $338—still leaving a $564 per ton margin.
In the company’s OmniSource and other metals recycling operations in the first quarter, operating income increased to $20 million, rising from $17 million in the previous quarter. SDI cites “improved recycled nonferrous shipments and average pricing” as a factor, adding, “Conversely, recycled ferrous shipments and metal spread declined modestly in the quarter.”
Looking at the rest of 2019, Millett comments, “We believe the market dynamics are in place for domestic steel consumption to continue to increase this year. In combination with our existing and newly announced expansion initiatives, we believe there are firm drivers for our continued growth.”
He continues, “We are excited about our planned flat-roll steel mill, and the anticipated long-term value creation it will bring through geographic and value-added product diversification. We plan for the new steel mill to have product capabilities beyond existing EAF flat-roll steel producers today, competing even more effectively with the integrated steel model and foreign competition. We have targeted regional markets that represent over 27 million tons of relevant flat-roll steel consumption, which includes the growing Mexican flat roll market. This facility should have a meaningful competitive advantage in those regions.”
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Source: Recycling Today
SDI reports 1Q profits, but down from 2018
<![CDATA[Fort Wayne, Indiana-based electric arc furnace (EAF) steelmaker Steel Dynamics Inc. (SDI) has announced first quarter 2019 sales of $2.8 billion and net income of $204 million, or 91 cents per share. That compares to first quarter 2018 net income of $228 million, or 96 cents per share, on sales of $2.6 billion.The results also were down from 2018 fourth quarter income of $270 million, or $1.17 per share. “The team delivered a strong first quarter performance in a somewhat challenging flat-roll steel pricing environment,” says Mark D. Millett, SDI’s president and CEO. “A downward trend in flat-roll steel prices began in the second half of 2018, and continued through mid-first quarter 2019, reaching an inflection point in February 2019.“Millett says SDI was able to increase shipments in the first quarter of 2019 “and offset some of the margin compression, resulting in first quarter 2019 consolidated operating income of $292 million and adjusted EBITDA [earnings before interest, tax, depreciation and amortization] of $382 million.”Also in the first quarter, SDI says its average product selling price within its steel operations decreased by $38 to $902 per ton. Meanwhile, the average ferrous scrap cost per ton melted decreased by just $5 per…