Condensed Consolidating Information

12 Months Ended

Dec. 31, 2011

Note 13. Condensed Consolidating Information

Certain 100%-owned subsidiaries of SDI have fully and unconditionally guaranteed all of the indebtedness relating to the issuance of the company's senior notes due 2012, 2014, 2015, 2016 and 2020. Following are the company's condensed consolidating financial statements, including the guarantors, which present the financial position, results of operations and cash flows of (i) SDI (in each case, reflecting investments in its consolidated subsidiaries under the equity method of accounting), (ii) the guarantor subsidiaries of SDI, (iii) the non-guarantor subsidiaries of SDI, and (iv) the eliminations necessary to arrive at the information on a consolidated basis. The following statements should be read in conjunction with the accompanying consolidated financial statements, and notes thereto.

Condensed Consolidating Balance Sheets (in thousands)

As of December 31, 2011	Parent			Guarantors		Combined Non-Guarantors			Consolidating Adjustments			Total Consolidated

Cash and equivalents	$	301,073		$	58,699	$	30,989		$	—		$	390,761
Investments in short-term commercial paper		84,830			—		—			—			84,830
Accounts receivable, net		319,995			726,192		8,971			(332,367	)		722,791
Inventories		584,079			533,022		85,046			(2,563	)		1,199,584
Other current assets		83,116			4,119		2,304			(32,247	)		57,292

Total current assets		1,373,093			1,322,032		127,310			(367,177	)		2,455,258
Property, plant and equiment, net		1,059,011			660,048		477,514			(2,828	)		2,193,745
Intangible assets, net		—			450,893		—			—			450,893
Goodwill		—			745,066		—			—			745,066
Other assets, including investments in subs		2,791,718			33,507		9,853			(2,700,814	)		134,264

Total assets	$	5,223,822		$	3,211,546	$	614,677		$	(3,070,819	)	$	5,979,226

Accounts payable	$	155,220		$	273,049	$	23,195		$	(30,640	)	$	420,824
Accrued expenses		157,868			98,498		10,012			(30,863	)		235,515
Current maturities of long-term debt		439,199			300		53,551			(48,972	)		444,078

Total current liabilities		752,287			371,847		86,758			(110,475	)		1,100,417
Long-term debt		1,905,199			—		169,797			(138,974	)		1,936,022
Other liabilities		250,395			2,132,778		51,625			(1,862,605	)		572,193
Redeemable noncontrolling interest		—			—		70,694			—			70,694
Common stock		636			33,896		18,121			(52,017	)		636
Treasury stock		(722,653	)		—		—			—			(722,653	)
Additional paid-in-capital		1,026,157			117,737		347,151			(464,888	)		1,026,157
Retained earnings (deficit)		2,011,801			555,288		(113,428	)		(441,860	)		2,011,801

Total Steel Dynamics, Inc. equity		2,315,941			706,921		251,844			(958,765	)		2,315,941
Noncontrolling interests		—			—		(16,041	)		—			(16,041	)

Total equity		2,315,941			706,921		235,803			(958,765	)		2,299,900

Total liabilities and equity	$	5,223,822		$	3,211,546	$	614,677		$	(3,070,819	)	$	5,979,226

Condensed Consolidating Balance Sheets (in thousands)

As of December 31, 2010	Parent			Guarantors		Combined Non-Guarantors			Consolidating Adjustments			Total Consolidated

Cash and equivalents	$	173,563		$	10,628	$	2,322		$	—		$	186,513
Accounts receivable, net		283,883			614,412		7,282			(283,388	)		622,189
Inventories		548,726			487,298		84,183			(6,144	)		1,114,063
Other current assets		96,040			9,757		3,444			(32,003	)		77,238

Total current assets		1,102,212			1,122,095		97,231			(321,535	)		2,000,003
Property, plant and equiment, net		1,110,350			684,118		421,897			(3,032	)		2,213,333
Intangible assets, net		—			489,240		—			—			489,240
Goodwill		—			751,675		—			—			751,675
Other assets, including investments in subs(1)		2,788,097			36,617		7,601			(2,696,632	)		135,683

Total assets	$	5,000,659		$	3,083,745	$	526,729		$	(3,021,199	)	$	5,589,934

Accounts payable	$	127,246		$	227,823	$	26,015		$	(32,483	)	$	348,601
Accrued expenses		123,498			102,114		8,497			(30,317	)		203,792
Current maturities of long-term debt		7,554			325		34,604			(33,559	)		8,924

Total current liabilities		258,298			330,262		69,116			(96,359	)		561,317
Long-term debt		2,344,399			—		168,278			(134,780	)		2,377,897
Other liabilities(1)		305,092			2,158,725		27,072			(1,971,298	)		519,591
Redeemable noncontrolling interest		—			—		54,294			—			54,294
Common stock		633			33,901		16,121			(50,022	)		633
Treasury stock		(727,624	)		—		—			—			(727,624	)
Additional paid-in-capital		998,728			117,737		256,905			(374,642	)		998,728
Retained earnings (deficit)		1,821,133			443,120		(49,022	)		(394,098	)		1,821,133

Total Steel Dynamics, Inc. equity		2,092,870			594,758		224,004			(818,762	)		2,092,870
Noncontrolling interests		—			—		(16,035	)		—			(16,035	)

Total equity		2,092,870			594,758		207,969			(818,762	)		2,076,835

Total liabilities and equity	$	5,000,659		$	3,083,745	$	526,729		$	(3,021,199	)	$	5,589,934

(1): Certain deferred tax asset and liability accounts have been reclassified at December 31, 2010, to conform to the December 31, 2011 presentation. These reclassifications had no impact to previously reported equity or total consolidated amounts.

Condensed Consolidating Statements of Operations (in thousands)

For the Year Ended, December 31, 2011	Parent			Guarantors			Combined Non-Guarantors			Consolidating Adjustments			Total Consolidated

Net sales	$	3,701,928		$	9,062,305		$	190,739		$	(4,957,472	)	$	7,997,500
Costs of goods sold		3,099,941			8,604,620			251,528			(4,890,107	)		7,065,982

Gross profit (loss)		601,987			457,685			(60,789	)		(67,365	)		931,518
Selling, general and administrative		135,509			217,717			9,184			(15,712	)		346,698

Operating income (loss)		466,478			239,968			(69,973	)		(51,653	)		584,820
Interest expense, net of capitalized interest		104,008			71,487			8,784			(7,302	)		176,977
Other (income) expense, net		(12,663	)		(8,012	)		(3,209	)		7,408			(16,476	)

Income (loss) before income taxes and equity in net income of subsidiaries		375,133			176,493			(75,548	)		(51,759	)		424,319
Income taxes (benefit)		111,532			66,734			(151	)		(19,488	)		158,627

		263,601			109,759			(75,397	)		(32,271	)		265,692
Equity in net income of subsidiaries		14,519			—			—			(14,519	)		—
Net loss attributable to noncontrolling interests		—			—			12,428			—			12,428

Net income (loss) attributable to Steel Dynamics, Inc.	$	278,120		$	109,759		$	(62,969	)	$	(46,790	)	$	278,120

For the Year Ended, December 31, 2010	Parent			Guarantors			Combined Non-Guarantors			Consolidating Adjustments			Total Consolidated

Net sales	$	2,866,541		$	7,067,399		$	118,141		$	(3,751,194	)	$	6,300,887
Costs of goods sold		2,467,780			6,701,621			164,400			(3,708,580	)		5,625,221

Gross profit (loss)		398,761			365,778			(46,259	)		(42,614	)		675,666
Selling, general and administrative		98,410			215,723			8,724			(11,944	)		310,913

Operating income (loss)		300,351			150,055			(54,983	)		(30,670	)		364,753
Interest expense, net of capitalized interest		99,639			67,659			13,168			(10,237	)		170,229
Other (income) expense, net		(14,629	)		(15,123	)		(296	)		11,113			(18,935	)

Income (loss) before income taxes and equity in net income of subsidiaries		215,341			97,519			(67,855	)		(31,546	)		213,459
Income taxes (benefit)		84,718			36,325			(26,477	)		(10,706	)		83,860

		130,623			61,194			(41,378	)		(20,840	)		129,599
Equity in net income of subsidiaries		10,086			—			—			(10,086	)		—
Net loss attributable to noncontrolling interests		—			—			11,110			—			11,110

Net income (loss) attributable to Steel Dynamics, Inc.	$	140,709		$	61,194		$	(30,268	)	$	(30,926	)	$	140,709

For the Year Ended, December 31, 2009	Parent			Guarantors			Combined Non-Guarantors			Consolidating Adjustments			Total Consolidated

Net sales	$	1,790,451		$	4,334,533		$	54,053		$	(2,220,231	)	$	3,958,806
Costs of goods sold		1,628,271			4,055,388			52,996			(2,176,925	)		3,559,730

Gross profit (loss)		162,180			279,145			1,057			(43,306	)		399,076
Selling, general and administrative		68,633			208,847			15,057			(12,992	)		279,545

Operating income (loss)		93,547			70,298			(14,000	)		(30,314	)		119,531
Interest expense, net of capitalized interest		83,297			58,049			735			(721	)		141,360
Other (income) expense, net		49,255			(55,700	)		9			2,844			(3,592	)

Income (loss) before income taxes and equity in net income of subsidiaries		(39,005	)		67,949			(14,744	)		(32,437	)		(18,237	)
Income taxes (benefit)		(15,438	)		26,894			(5,835	)		(12,839	)		(7,218	)

		(23,567	)		41,055			(8,909	)		(19,598	)		(11,019	)
Equity in net income of subsidiaries		15,383			—			—			(15,383	)		—
Net loss attributable to noncontrolling interests		—			—			2,835			—			2,835

Net income (loss) attributable to Steel Dynamics, Inc.	$	(8,184	)	$	41,055		$	(6,074	)	$	(34,981	)	$	(8,184	)

Condensed Consolidating Statements of Cash Flows (in thousands)

For the Year Ended, December 31, 2011	Parent			Guarantors			Combined Non-Guarantors			Consolidating Adjustments			Total Consolidated

Net cash provided by (used in) operating activities	$	380,171		$	173,574		$	(68,110	)	$	720		$	486,355
Net cash provided by (used in) investing activities		(230,314	)		(50,576	)		(65,144	)		110,197			(235,837	)
Financing activities
Issuance of long term debt		—			10,103			101,686			(101,686	)		10,103
Repayments of long term debt		(6,505	)		(1,075	)		(82,241	)		82,081			(7,740	)
Other		(15,842	)		(83,955	)		142,476			(91,312	)		(48,633	)

Net cash provided by (used in) financing activities		(22,347	)		(74,927	)		161,921			(110,917	)		(46,270	)

Increase in cash and equivalents		127,510			48,071			28,667			—			204,248
Cash and equivalents at beginning of period		173,563			10,628			2,322			—			186,513

Cash and equivalents at end of period	$	301,073		$	58,699		$	30,989		$	—		$	390,761

For the Year Ended, December 31, 2010	Parent			Guarantors			Combined Non-Guarantors			Consolidating Adjustments			Total Consolidated

Net cash provided by (used in) operating activities	$	262,155		$	17,011		$	(109,221	)	$	(638	)	$	169,307
Net cash provided by (used in) investing activities		(38,811	)		(51,414	)		(59,491	)		638			(149,078	)
Financing activities
Issuance of long term debt		554,001			—			110,743			(108,191	)		556,553
Repayments of long term debt		(361,383	)		14,979			(559	)		—			(346,963	)
Other		(242,829	)		23,690			58,634			108,191			(52,314	)

Net cash provided by (used in) financing activities		(50,211	)		38,669			168,818			—			157,276

Increase in cash and equivalents		173,133			4,266			106			—			177,505
Cash and equivalents at beginning of period		430			6,362			2,216			—			9,008

Cash and equivalents at end of period	$	173,563		$	10,628		$	2,322		$	—		$	186,513

For the Year Ended, December 31, 2009	Parent			Guarantors			Combined Non-Guarantors			Consolidating Adjustments			Total Consolidated

Net cash provided by (used in) operating activities	$	261,605		$	176,382		$	(38,811	)	$	46,380		$	445,556
Net cash provided by (used in) investing activities		(77,069	)		(71,998	)		(227,459	)		2,581			(373,945	)
Financing activities
Issuance of long term debt		1,219,500			—			227,831			(178,896	)		1,268,435
Repayments of long term debt		(1,699,972	)		9,486			(71	)		—			(1,690,557	)
Other		294,977			(119,022	)		37,396			129,935			343,286

Net cash provided by (used in) financing activities		(185,495	)		(109,536	)		265,156			(48,961	)		(78,836	)

Decrease in cash and equivalents		(959	)		(5,152	)		(1,114	)		—			(7,225	)
Cash and equivalents at beginning of period		1,389			11,514			3,330			—			16,233

Cash and equivalents at end of period	$	430		$	6,362		$	2,216		$	—		$	9,008