8-K

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC  20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (date of earliest event reported): July 20, 2006 (July 19, 2006)

STEEL DYNAMICS, INC.

(Exact name of registrant as specified in its charter)

Indiana	0-21719	35-1929476
(State or other jurisdiction	(Commission File Number)	(IRS Employer
of incorporation)		Identification No.)

6714 Pointe Inverness Way, Suite 200, Fort Wayne, Indiana 46804

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code:  260-459-3553

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o            Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o            Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o            Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o            Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02.  Results of Operations and Financial Condition

On July 19, 2006, Steel Dynamics, Inc. issued a press release titled “Steel Dynamics Reports Strong Results for Second Quarter 2006” containing information about the company’s results of operations for the three and six-month periods ended June 30, 2006.  The full text of the press release, together with related unaudited financial information and statistics, is furnished herewith and attached hereto as Exhibit 99.1.

Item 9.01.  Financial Statements and Exhibits

( c )                Exhibits.

Exhibit Number	Description
99.1	A press release dated July 19, 2006 titled “Steel Dynamics Reports Strong Results for Second Quarter 2006”

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by the undersigned hereto duly authorized.

	STEEL DYNAMICS, INC.
Date: July 20, 2006	By:	/s/ Gary Heasley
		Gary Heasley
		Vice President & CFO

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EX-99.1

Exhibit 99.1

Press Release
July 19, 2006
	6714 Pointe Inverness Way, Suite 200
	Fort Wayne, IN  46804-7932
	260.459.3553 Phone260.969.3590 Fax

Steel Dynamics Reports Strong Results for Second Quarter 2006

FORT WAYNE, INDIANA, July 19, 2006— Steel Dynamics, Inc. (NASDAQ:STLD) today announced second quarter 2006 net earnings of $97 million, or $1.78 per diluted share, versus $51 million or $1.00 per diluted share in the second quarter of 2005 and $76 million, or $1.52 per diluted share, in the first quarter of 2006.  Net sales for the second quarter were $821 million, an increase of 50 percent when compared to the second quarter of 2005 and 23 percent when compared to the first quarter of 2006.  Net income was up 27 percent quarter over quarter.  Operating income per ton shipped was $127 for the quarter.  Consolidated shipments for the second quarter were 1.2 million tons.  Second quarter and first half revenues and shipments both set new records for the company.

“Steel Dynamics enjoyed continued strength in the second quarter,” said Keith Busse, President and CEO.  “Demand has remained very strong for the entire portfolio of products we produce.  We have been able to take advantage of these conditions and continue to ramp up the recent investments we have made in new facilities, additional equipment, and production capability.  As a result of higher utilization rates at our facilities, we are maintaining high production rates and shipping volumes, as well as strong profit margins.”

Second quarter 2006 figures include the results of operations of the former Roanoke Electric Steel Corporation from April 12, 2006 forward.  Although the Roanoke numbers were somewhat accretive to earnings in the second quarter, the effect of certain purchase accounting adjustments related to the acquisition reduced SDI’s second quarter earnings by approximately $.08 per diluted share.  The integration of Roanoke into Steel Dynamics is proceeding smoothly.  Both of the merged steelmaking operations, like the rest of SDI, are running very well and are experiencing strong markets and shipping rates.  In the third and fourth quarters, the Roanoke operations are expected to be significantly accretive to earnings.

SDI’s average consolidated selling price per ton shipped increased from $631 in the first quarter to $672 in the second quarter due largely to better price realizations and mix, while the cost of steel scrap per net ton charged increased $10 from the first quarter.

Operating highlights for the second quarter include monthly and quarterly production records by the structural division, which continues to improve its production processes and practices.  The structural mill continues to benefit from a very strong market for wide-flange beams.  Likewise, demand is very strong at the Flat Roll Division, and the Engineered Bar Products Division, which produces SBQ bars, is experiencing a record backlog.  All of the steel business units are experiencing favorable pricing trends at this time.

The Engineered Bar Division at Pittsboro, Indiana, has begun operation of its new SBQ finishing facility, providing a number of SBQ value-added operations to meet customer requirements.  These services have permitted the mill to increase the proportion of its business under contract, which in turn helps to provide a more stable base load for the mill.

Iron Dynamics, which supplies hot-briquetted iron (HBI) to all of SDI’s Indiana steelmaking divisions and liquid pig iron to Butler, performed well and was profitable for the quarter.  The facility is now producing over 20,000 tonnes per month.

In June, the Butler Flat Roll mill completed a scheduled five-day outage to accomplish a number of equipment modifications, including the upgrade of one of the mill’s two casters.  These changes, as well as similar modifications to the second caster scheduled for October, should ultimately lead to an approximate 15 percent increase in the facility’s hot-band production capacity.  The $10-million investment in upgrades is expected to increase production by approximately 400,000 to 500,000 tons per year, bringing Butler’s capability to nearly 3 million tons per annum.

Looking ahead, Busse said, “The outlook is for continued strength in the steel marketplace in the second half.  Recent increases in global steel prices, with the possible exception of China, are better aligning the U.S. market with dynamics elsewhere in the world.  Steel imports are expected to decline in the short term, although this can change overnight.  In the near term, we see prospects for continued favorable pricing trends, moderating steel scrap costs, and strong shipping volumes leading to a very positive earnings outlook for Steel Dynamics given our continued growth prospects.  Our diluted earnings per share will likely be in the range of $2.05 to $2.15 in the third quarter.  Barring unanticipated events affecting the steel marketplace in the fourth quarter, it is likely that 2006 results will eclipse our previous annual record of $5.27 per diluted share earned in 2004.  With continued strong activity through year-end, we anticipate 2006’s earnings could approach $7.25 to $7.50 per diluted share.”

“We are fortunate to be in a position to capitalize on numerous investments that we have made in modern, productive assets over the past several years.  We now have a more diversified product mix with an emphasis on value-added and customer-tailored steel products.  A large part of our success flows from our operating culture and the strong performance of our dedicated workforce, which is doing an outstanding job,” Busse said.

Regarding the status of previously announced projects, site preparation has begun and initial equipment orders have been placed for the $200-million expansion project at the Columbia City, Indiana, structural and rail mill.  This project includes a new medium-section rolling mill that will facilitate more cost-effective production of current structural steel products, will free up production capacity for rail production on the existing rolling mill, and will provide the capability to produce new light structural steel products that the company does not currently sell.  Also, construction is proceeding at Columbia City on a rail-welding facility to produce rail sections a quarter-mile in length.  Construction of Dynamic Composites, a joint venture to manufacture composite railroad ties, is also underway.

Equipment orders have been placed for the company’s second paint line, to be built at Jeffersonville, Indiana, and expected to start up in the third quarter of 2007.  The Jeffersonville flat-roll finishing facility is dedicated to the coating of thin-gauge, cold-rolled steel that is supplied from the Butler Flat Roll mill.  Additional modifications are underway at Jeffersonville to add acrylic coating and the production of Galvalume® coated steels for the construction markets.

Several projects are in progress to modernize and upgrade the three joist production facilities acquired as a part of the Roanoke transaction.  These facilities are being integrated into SDI’s New Millennium Building Systems subsidiary and together will provide a network of facilities to better serve the U.S. non-residential construction markets east of the Mississippi River.  As a part of this effort, some joist and girder production is being shifted between locations and the capability to produce roof- and floor-decking is being added at the Salem, Virginia, plant.  Business remains strong in this business segment.

In the future, we expect to make investments in the Roanoke steelmaking facilities to improve their operating effectiveness and increase production capacities.  Engineering studies of various options are in progress.

Galvalume® is a registered trademark of BIEC International, Inc.

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Conference Call and Webcast

On Thursday, July 20, 2006 at 11:00 a.m. Eastern, Steel Dynamics will host a conference call in which Steel Dynamics’ management will discuss second quarter 2006 results.  You are invited to listen to the live audio broadcast of the conference call over the Internet, accessible from Steel Dynamics’ Web site:

www.steeldynamics.com

Dial-in information to listen to the call is available on our Web site.  Only analysts and other callers identified prior to the call will be included in queue for questions.

No telephone replay will be available. An audio replay of the Webcast will be available on the SDI Web site. Also, using the VCall webcast link, you may download the replay as an MP3 file (podcast).

Contact:  Fred Warner, Investor Relations Manager, (260) 969-3564

 F.Warner@SteelDynamics.com

Forward Looking Statements

This press release contains some predictive statements about future events, including statements related to conditions in the steel marketplace, Steel Dynamics’ revenue growth, costs of raw materials, future profitability and earnings, and the operation of new or existing facilities. These statements are intended to be made as “forward-looking,” subject to many risks and uncertainties, within the safe harbor protections of the Private Securities Litigation Reform Act of 1995. Such predictive statements are not guarantees of future performance, and actual results could differ materially from our current expectations.

Factors that could cause such predictive statements to turn out other than as anticipated or predicted include, among others:  changes in economic conditions affecting steel consumption; increased foreign imports; increased price competition; difficulties in integrating acquired businesses; risks and uncertainties involving new products or new technologies; changes in the availability or cost of steel scrap or substitute materials; increases in energy costs; occurrence of unanticipated equipment failures and plant outages; labor unrest; and the effect of the elements on production or consumption.

In addition, we refer you to SDI’s detailed explanation of these and other factors and risks that may cause such predictive statements to turn out differently, as set forth in our most recent Annual Report on Form 10-K and in other reports which we from time to time file with the Securities and Exchange Commission, available publicly on the SEC Web site, www.sec.gov, and on the Steel Dynamics Web site, www.steeldynamics.com

Forward-looking or predictive statements we make are based on our knowledge of our businesses and the environment in which they operate as of the date on which the statements were made.  Due to these risks and uncertainties, as well as matters beyond our control which can affect forward looking statements, you are cautioned not to place undue reliance on these predictive statements, which speak only as of the date of this press release.  We undertake no duty to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

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Steel Dynamics, Inc.

UNAUDITED CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except per share data)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2006			2005			2006			2005
Net Sales	$	821,247		$	545,826		$	1,487,125		$	1,116,532
Costs of goods sold	624,692			434,642			1,131,083			876,571
Selling, general, and administrative expenses	41,872			20,081			70,247			42,535
Operating Income	154,683			91,103			285,795			197,426
Interest expense	8,560			8,898			16,696			16,975
Other (income) expense, net	(1,275		)	(175		)	(1,956		)	(753		)
Income before income taxes	147,398			82,380			271,055			181,204
Income taxes	50,529			31,717			98,137			69,764
Net income	$	96,869		$	50,663		$	172,918		$	111,440
Basic earnings per share	$	2.01		$	1.14		$	3.77		$	2.42
Weighted average common shares outstanding	48,231			44,510			45,874			46,106
Diluted earnings per share,
including effect of assumed conversions	$	1.78		$	1.00		$	3.31		$	2.12
Weighted average common shares and share equivalents outstanding	54,883			51,472			52,609			53,150
Dividends declared per share	$	.20		$	.10		$	.40		$	.20

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Steel Dynamics, Inc.

UNAUDITED SUPPLEMENTAL OPERATING INFORMATION

	Three Months Ended						Six Months Ended						First
	June 30,						June 30,						Quarter
	2006			2005			2006			2005			2006
Shipments and Production Data (tons)
Shipments
Steel Operations*
Flat Roll Division	653,075			569,867			1,316,120			1,139,423			663,045
Structural & Rail Division	242,627			205,433			489,760			392,047			247,133
Engineered Bar Division	124,132			108,434			249,482			197,982			125,350
Roanoke Bar Division	146,260			—			146,260			—			—
Steel of West Virginia	80,412			—			80,412			—			—
	1,246,506			883,734			2,282,034			1,729,452			1,035,528
Steel Fabrication Operations**	60,862			34,804			101,551			56,865			40,689
Other Operations***	122,595			64,620			195,791			139,800			73,196
Intercompany	(208,388		)	(86,072		)	(302,049		)	(175,888		)	(93,661		)
Consolidated shipments	1,221,575			897,086			2,277,327			1,750,229			1,055,752
Steel Operations* production	1,305,996			893,559			2,366,881			1,775,870			1,060,885
Average consolidated selling price per ton	$	672		$	608		$	653		$	638		$	631

*Steel Operations include the company’s Flat Roll Division, Structural and Rail Division, Engineered Bar Products Division, and after the effective date of the merger on April 12, 2006, also include Roanoke Bar Division and Steel of West Virginia operations.

**Steel Fabrication Operations include the company’s two existing joist and deck fabrication plants located in Indiana and Florida, and after the effective date of the merger on April 12, 2006, also include three additional joist fabrication plants located in Ohio, Virginia, and South Carolina.

***Other Operations include Iron Dynamics and Paragon Steel Enterprises, and after the effective date of the merger on April 12, 2006, also include the operations from two steel scrap processing facilities.

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Steel Dynamics, Inc.
CONSOLIDATED BALANCE SHEETS
(in thousands)

	June 30, 2006			December 31, 2005
	(unaudited)
Assets
Current assets
Cash and equivalents	$	53,948		$	65,518
Accounts receivable	354,291			241,708
Inventories	528,683			398,684
Deferred income taxes	17,346			6,516
Other current assets	21,853			13,307
Total current assets	976,121			725,733
Property, plant and equipment, net	1,113,709			999,969
Restricted cash	4,535			1,588
Intangible Assets	12,335			—
Goodwill	30,720			1,925
Other assets	27,053			28,472
Total assets	$	2,164,473		$	1,757,687
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable	$	169,686		$	115,542
Accrued expenses	93,101			80,527
Accrued interest	9,810			8,952
Current portion of long-term debt	649			2,156
Total current liabilities	273,246			207,177
Long-term debt
Senior unsecured 9.5% notes	300,000			300,000
Subordinated convertible 4.0% notes	79,995			115,000
Other long-term debt	17,887			17,959
Unamortized bond premium	4,615			5,459
Total long-term debt	402,497			438,418
Deferred income taxes	262,047			231,106
Minority interest	1,747			1,118
Commitments and contingencies
Stockholders’ equity
Common stock	536			529
Treasury stock, at cost	(88,914		)	(270,905		)
Additional paid-in capital	414,792			405,900
Retained earnings	898,522			744,344
Total stockholders’ equity	1,224,936			879,868
Total liabilities and stockholders’ equity	$	2,164,473		$	1,757,687

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Steel Dynamics, Inc.
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)

	Three Months Ended June 30,						Six Months Ended June 30,
	2006			2005			2006			2005
Operating activities:
Net income	$	96,869		$	50,663		$	172,918		$	111,440
Adjustments to reconcile net income to net cash providedby operating activities:
Depreciation and amortization	30,438			21,579			55,355			43,409
Intangible asset amortization	2,165			—			2,165			—
Deferred income taxes	(5,862		)	1,435			(5,734		)	14,468
Minority interest	389			(1,552		)	628			(1,434		)
Changes in certain assets and liabilities:
Accounts receivable	(10,797		)	28,426			(29,984		)	14,494
Inventories	(30,993		)	(26,259		)	(13,814		)	(40,405		)
Accounts payable	(60,299		)	(59,029		)	(220		)	(48,186		)
Other working capital	194			3,864			(23,178		)	(19,685		)
Net cash provided by operating activities	22,104			19,127			158,136			74,101
Investing activities:
Purchase of property, plant and equipment	(33,882		)	(17,146		)	(48,467		)	(36,287		)
Acquisition of business, net of cash acquired	(89,106		)	—			(89,106		)	—
Purchase of short-term investments	—			—			(14,075		)	—
Maturities of short-term investments	4,700			—			14,075			—
Net cash used in investing activities	(118,288		)	(17,146		)	(137,573		)	(36,287		)
Financing activities:
Issuance of long-term debt	—			176,297			—			237,605
Repayment of long-term debt	(45,488		)	(72,061		)	(47,146		)	(112,571		)
Issuance of common stock (net of expenses) andproceeds and tax benefits from exercise of stock options	8,534			472			27,356			12,836
Issuance (purchase) of treasury stock	193			(103,724		)	788			(180,424		)
Dividends paid	(8,812		)	(4,721		)	(13,131		)	(9,603		)
Debt issuance costs	—			(346		)	—			(346		)
Net cash used in financing activities	(45,573		)	(4,083		)	(32,133		)	(52,503		)
Decrease in cash and equivalents	(141,757		)	(2,102		)	(11,570		)	(14,689		)
Cash and equivalents at beginning of period	195,705			3,747			65,518			16,334
Cash and equivalents at end of period	$	53,948		$	1,645		$	53,948		$	1,645
Supplemental disclosure of cash flow information:
Cash paid for interest	$	2,171		$	2,961		$	16,439		$	17,018
Cash paid for federal and state income taxes	$	94,365		$	54,607		$	95,541		$	54,777

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