EX-99.1 2 a14-4513_1ex99d1.htm EX-99.1

Exhibit 99.1

 

Press Release
January 27, 2014

 

 

 

7575 W. Jefferson Blvd.

 

Fort Wayne, IN 46804

 

Steel Dynamics Reports Fourth Quarter 2013 Diluted Earnings Per Share of $0.24

 

FORT WAYNE, INDIANA, January 27, 2014 / PRNewswire / Steel Dynamics, Inc. (NASDAQ/GS: STLD) today announced fourth quarter net income of $55 million, or $0.24 per diluted share, on net sales of $1.9 billion. By comparison, prior year fourth quarter net income was $61 million, or $0.27 per diluted share, on net sales of $1.7 billion, and sequential third quarter 2013 net income was $57 million, or $0.25 per diluted share, on net sales of $1.9 billion. Full-year 2013 net income was $189 million, or $0.83 per diluted share, on net sales of $ 7.4 billion.  By comparison, fiscal year 2012 net income was $164 million, or $0.73 per diluted share, on net sales of $7.3 billion.

 

When compared to the third quarter of 2013, fourth quarter 2013 results included an additional $4.5 million, or approximately $0.01 per diluted share, of non-cash equity compensation expense primarily related to the company-wide restricted stock unit benefit plan.  The company’s prior year financial results included charges related to refinancing expenses, non-cash impairment charges and certain positive tax adjustments.  Excluding these items from the relevant periods, the company’s adjusted earnings per diluted share would have been $0.20 for the fourth quarter 2012 and $0.77 for the full-year 2012.

 

“We continued to perform at the top of our industry during 2013, both financially and operationally,” said Chief Executive Officer, Mark D. Millett.  “Annual 2013 pretax income improved 29 percent as a result of our recent capital structure initiatives.  Our steel operations achieved record annual shipments, with the Flat Roll and Structural and Rail divisions attaining individual records.  As expected, fourth quarter steel shipments declined sequentially due to seasonal declines and scheduled maintenance.  However, the segment’s fourth quarter 2013 operating income increased modestly as the expansion in sheet steel metal margins more than offset the lower shipping volumes and reduced long product metal margins.

 

“Excluding the impact from non-cash unrealized hedging, 2013 full-year operating income for our metals recycling operations was fairly flat, as improved operating costs offset lower shipments,” stated Millett.  “During the fourth quarter, operating income for our metals recycling operations improved slightly, when compared to the third quarter of this year, with improved ferrous metal margins offsetting lower volume and decreased nonferrous profitability.  The ongoing overcapacity of recycled shredding locations throughout the United States, especially in the Southeast, continues to constrain profitability and remains a broad industry challenge.”

 

Fabricated steel consumption improved during 2013 with estimated domestic joist shipments increasing 14 percent when compared to 2012.  The company’s fabrication business gained market share during the year, achieving a 24 percent increase in 2013 annual shipments, more than tripling annual operating income, and achieving full-year pretax profitably for the first time since the 2008 economic downturn.  Order inquiry continues to improve and is considerably stronger than experienced during the post-2008 economic environment from 2009 through 2012, further supporting the premise of a nonresidential construction market recovery.

 

Fourth Quarter Review

 

Based on typical seasonal trends, fourth quarter 2013 shipments across the company’s operating platforms generally decreased when compared to the sequential quarter, slightly contracting revenues despite increased average pricing.   Fourth quarter 2013 operating income for the company’s steel operations was $155 million, an increase of four percent when compared to the third quarter 2013, despite decreased volume.  Steel metal margins expanded in the quarter as average selling values increased more than ferrous raw material costs.  The average selling price per ton for the company’s steel operations increased $11 sequentially to $805 in the fourth quarter 2013, while the average ferrous scrap cost per ton melted increased $7 per ton.

 


 

Operating income attributable to the company’s steel sheet operations increased ten percent when compared to the sequential quarter, more than offsetting the five percent decline in operating income from long product operations.  Unlike steel sheet, long product pricing did not increase sufficiently to offset increased ferrous raw material costs in the fourth quarter, especially for structural related steel.  The company’s steel mill production utilization rate was basically unchanged at 88 percent in the fourth quarter 2013, compared to 89 percent in the sequential third quarter.

 

Operating income from the company’s metals recycling operations was generally unchanged in the fourth quarter 2013, when compared to the sequential quarter, as a 15 percent improvement in ferrous metal margin was offset by decreased shipments and compressed nonferrous metal margins.

 

The impact of losses from the company’s Minnesota operations for fourth quarter 2013 consolidated net income was $8.1 million, or $0.03 per diluted share, as compared to $10.6 million, or $0.04 per diluted share, in the third quarter 2013.  As referenced in the company’s October earnings release, as production rates and plant availability improved at the iron nugget plant in the third quarter 2013, product yield unexpectedly deteriorated.  During the fourth quarter 2013, the focus to reduce production costs and improve product yield progressed and positive results were achieved.  Certain meaningful adjunct trials that began in the later part of the fourth quarter are planned for completion during the first quarter 2014, at which point we will assess the progress achieved and determine next steps.  Given the increased cost of production while testing occurs, current expectations concerning losses associated with the Minnesota operations for the first quarter of 2014 are anticipated to be similar to those recorded in the fourth quarter.

 

Full-Year Review

 

Consolidated 2013 net sales of $7.4 billion and operating income of $387 million were relatively unchanged from 2012 results, despite generally higher shipments, as 2013 full-year metal margins declined for the company’s steel and metals recycling operations.  However, 2013 consolidated pretax income (excluding losses attributable to noncontrolling interests) improved $63 million, or 28 percent, reflecting interest cost savings of $31 million and a reduction in refinancing costs of $38 million, which were associated with the company’s 2012 and early 2013 financing activities.

 

The company’s annual 2013 steel mill production utilization rate was 88 percent, a six percentage point increase over 2012, with increases from the Structural and Rail and Flat Roll divisions.  Notably the Structural and Rail Division operated at an annual rate of 68 percent for 2013, and for the second half of the year operated at a rate of 71 percent, which is significantly higher than any time since the precipitous decline in the nonresidential construction markets at the end of 2008.  The increased utilization is a result of the benefit of product diversification through the introduction of railroad rail, as well as the continued modest growth in construction.  The average selling price per ton shipped for the company’s steel operations for 2013 was $793, a decrease of $38 per ton as compared to 2012 and the average ferrous cost per ton melted was $25 lower.

 

“We are optimistic entering 2014,” said Millett. “The broader U.S. economy continues to improve.  We believe the non-service sector portion of domestic GDP has the ability to grow at a higher rate than overall GDP, driven by strengthened asset values, domestic energy investment and increased infrastructure spending.  Steel consumption would benefit from a recovery in the non-service sector of the U.S. economy.  Among others, these sectors include heavy steel consuming automotive, machinery, heavy equipment and construction industries.  We believe our low-cost operations and preferred customer service, combined with the strength of our exceptional employees, uniquely positions us to capitalize on the opportunities ahead.”

 


 

Summary Operating Information

 

The following tables highlight operating results for each of the company’s primary operating platforms. References to operating income in the following paragraphs exclude profit-sharing expenses and amortization pertaining to intangible assets.  Dollar amounts are in thousands, except for per ton data.

 

Steel Operations

 

This segment includes five electric-arc-furnace steel mills and related steel finishing and processing facilities, including The Techs. The company’s steel operations produce flat-rolled steel, structural steel, merchant bars, special-bar-quality steel, rebar, rail, and specialty shapes.

 

 

 

Fourth Quarter

 

Full Year

 

Sequential

 

 

 

2013

 

2012

 

2013

 

2012

 

3Q 2013

 

Total Sales

 

$

1,222,907

 

$

1,126,438

 

$

4,768,004

 

$

4,782,240

 

$

1,237,247

 

External Sales

 

1,146,701

 

1,061,419

 

4,461,457

 

4,506,788

 

1,162,429

 

Operating Income

 

155,107

 

117,097

 

513,227

 

505,080

 

148,698

 

Shipments (tons)

 

1,542,289

 

1,457,053

 

6,119,884

 

5,832,776

 

1,585,125

 

Average External Sales Price Per Ton

 

$

805

 

$

784

 

$

793

 

$

831

 

$

794

 

Average Ferrous Scrap Cost Per Ton

 

$

356

 

$

343

 

$

353

 

$

378

 

$

349

 

 

Metals Recycling and Ferrous Resources Operations

 

This segment principally includes the company’s metals recycling operations (OmniSource Corporation), a liquid pig iron production facility (Iron Dynamics), and the company’s Minnesota operations.

 

Metals Recycling & Ferrous Resources

 

 

 

Fourth Quarter

 

Full Year

 

Sequential

 

 

 

2013

 

2012

 

2013

 

2012

 

3Q 2013

 

Total Sales

 

$

907,668

 

$

798,163

 

$

3,663,486

 

$

3,658,952

 

$

948,134

 

External Sales

 

572,840

 

530,258

 

2,384,841

 

2,342,598

 

605,381

 

Operating Income (Loss)

 

(13,020

)

507

 

(30,835

)

(11,690

)

(11,695

)

Unrealized Hedging Gain (Loss), Net

 

(2,626

)

9,656

 

(4,943

)

3,389

 

(2,451

)

 

Metals Recycling (OmniSource)

 

 

 

Fourth Quarter

 

Full Year

 

Sequential

 

 

 

2013

 

2012

 

2013

 

2012

 

3Q 2013

 

Total Sales

 

$

797,034

 

$

741,342

 

$

3,274,866

 

$

3,441,348

 

$

848,043

 

External Sales

 

535,549

 

520,931

 

2,277,550

 

2,329,096

 

577,087

 

Operating Income

 

11,667

 

25,818

 

63,582

 

72,473

 

11,166

 

Unrealized Hedging Gain (Loss), Net

 

(1,707

)

9,820

 

(3,990

)

3,588

 

(1,391

)

Ferrous Shipments (gross tons)

 

1,356,258

 

1,238,143

 

5,505,995

 

5,647,058

 

1,472,418

 

% Shipments to Company Steel Mills

 

47

%

46

%

44

%

46

%

46

%

Nonferrous Shipments (pounds 000’s)

 

254,876

 

251,080

 

1,052,494

 

1,051,333

 

263,467

 

 

Steel Fabrication Operations

 

Steel fabrication operations include New Millennium Building Systems, which fabricates steel joists, trusses, and decking used in the construction of non-residential buildings.

 

 

 

Fourth Quarter

 

Full Year

 

Sequential

 

 

 

2013

 

2012

 

2013

 

2012

 

3Q 2013

 

Total Sales

 

$

121,853

 

$

98,301

 

$

439,655

 

$

371,406

 

$

119,268

 

Operating Income (Loss)

 

(122

)

1,448

 

7,003

 

2,114

 

3,265

 

Shipments (tons)

 

101,132

 

76,870

 

366,676

 

295,161

 

101,590

 

Average External Sales Price Per Ton

 

$

1,205

 

$

1,278

 

$

1,199

 

$

1,258

 

$

1,174

 

 


 

About Steel Dynamics, Inc.

 

Steel Dynamics, Inc. is one of the largest domestic steel producers and metals recyclers in the United States based on estimated annual steelmaking and metals recycling capability, with annual sales of $7.4 billion in 2013, over 6,800 employees, and manufacturing facilities primarily located throughout the United States (including five steel mills, six steel processing facilities, two iron production facilities, over 90 metals recycling locations and six steel fabrication plants).

 

Forward-Looking Statement

 

This press release contains some predictive statements about future events, including statements related to conditions in the steel and metallic scrap markets, Steel Dynamics’ revenues, costs of purchased 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. These statements speak only as of this date and are based upon information and assumptions, which we consider reasonable as of this date, concerning our businesses and the environments in which they operate. Such predictive statements are not guarantees of future performance, and we undertake no duty to update or revise any such statements. Some factors that could cause such forward-looking statements to turn out differently than anticipated include: (1) the effects of a recurrent slowing economy on industrial demand; (2) changes in economic conditions, either generally or in any of the steel or scrap-consuming sectors which affect demand for our products, including the strength of the non-residential and residential construction, automotive, appliance, and other steel-consuming industries; (3) fluctuations in the cost of key raw materials (including steel scrap, iron units, and energy costs) and our ability to pass-on any cost increases; (4) the impact of domestic and foreign import price competition; (5) risks and uncertainties involving product and/or technology development; and (6) occurrences of unexpected plant outages or equipment failures.

 

More specifically, we refer you to SDI’s more 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, in our quarterly reports on Form 10-Q or in other reports which we from time to time file with the Securities and Exchange Commission. These are available publicly on the SEC Web site, www.sec.gov, and on the Steel Dynamics Web site, www.steeldynamics.com.

 

Conference Call and Webcast

 

On Tuesday, January 28, 2014, at 9:30 a.m. Eastern Time, Steel Dynamics will host a conference call with investors and analysts to discuss the company’s fourth quarter and full-year 2013 operating and financial results.  We invite you to listen to the live audiocast of the conference call accessible from our website (http://www.steeldynamics.com), or via telephone (the conference call number may also be obtained on our website).   A replay of the discussion will be available on our website until midnight on February 4, 2014.  A podcast/MP3 file of the event will also be available and can be downloaded from our website.

 

Contact:  Marlene Owen, Director Investor Relations —+1.260.969.3500

 


 

Steel Dynamics, Inc.

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

(in thousands, except per share data)

 

 

 

Three Months Ended

 

Year Ended

 

Three Months
Ended

 

 

 

December 31,

 

December 31,

 

September 30,

 

 

 

2013

 

2012

 

2013

 

2012

 

2013

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$

1,864,150

 

$

1,705,001

 

$

7,372,924

 

$

7,290,234

 

$

1,911,738

 

Costs of goods sold

 

1,666,154

 

1,524,904

 

6,653,780

 

6,570,336

 

1,714,546

 

Gross profit

 

197,996

 

180,097

 

719,144

 

719,898

 

197,192

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative expenses

 

74,606

 

69,340

 

272,777

 

257,943

 

67,553

 

Profit sharing

 

7,873

 

6,750

 

27,764

 

26,987

 

8,469

 

Amortization of intangible assets

 

7,695

 

8,722

 

31,770

 

35,553

 

7,897

 

Impairment charges

 

—

 

356

 

308

 

8,250

 

—

 

Operating income

 

107,822

 

94,929

 

386,525

 

391,165

 

113,273

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net of capitalized interest

 

30,664

 

34,877

 

127,728

 

158,585

 

30,970

 

Other expense (income), net

 

111

 

(3,852

)

(4,033

)

28,514

 

(1,852

)

Income before income taxes

 

77,047

 

63,904

 

262,830

 

204,066

 

84,155

 

 

 

 

 

 

 

 

 

 

 

 

 

Income taxes

 

29,146

 

8,810

 

99,314

 

61,785

 

33,065

 

Net income

 

47,901

 

55,094

 

163,516

 

142,281

 

51,090

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss attributable to noncontrolling interests

 

6,754

 

5,477

 

25,798

 

21,270

 

6,396

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to Steel Dynamics, Inc.

 

$

54,655

 

$

60,571

 

$

189,314

 

$

163,551

 

$

57,486

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per share attributable to Steel Dynamics, Inc. stockholders

 

$

0.25

 

$

0.28

 

$

0.86

 

$

0.75

 

$

0.26

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding

 

222,273

 

219,346

 

220,916

 

219,159

 

220,926

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings per share attributable to Steel Dynamics, Inc. stockholders, including the effect of assumed conversions when dilutive

 

$

0.24

 

$

0.27

 

$

0.83

 

$

0.73

 

$

0.25

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares and equivalents outstanding

 

240,493

 

236,890

 

238,996

 

236,624

 

239,001

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividends declared per share

 

$

0.11

 

$

0.10

 

$

0.44

 

$

0.40

 

$

0.11

 

 


 

Steel Dynamics, Inc.

UNAUDITED SUPPLEMENTAL OPERATING INFORMATION

(dollars in thousands)

 

 

 

Three Months Ended

 

Year Ended

 

Three Months Ended

 

 

 

December 31,

 

December 31,

 

March 31,

 

June 30,

 

September 30,

 

 

 

2013

 

2012

 

2013

 

2012

 

2013

 

2013

 

2013

 

Steel Operations*

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shipments (tons)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Flat Roll Division

 

738,998

 

713,770

 

2,904,149

 

2,717,995

 

704,290

 

720,582

 

740,279

 

Structural and Rail Division

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Structural

 

259,884

 

225,100

 

972,798

 

887,335

 

228,089

 

223,700

 

261,125

 

Rail

 

35,043

 

37,341

 

205,808

 

144,169

 

52,808

 

63,274

 

54,683

 

Engineered Bar Products Division

 

123,865

 

98,858

 

488,393

 

535,882

 

112,821

 

123,919

 

127,788

 

Roanoke Bar Division

 

150,986

 

127,952

 

569,260

 

581,180

 

139,950

 

134,001

 

144,323

 

Steel of West Virginia

 

70,972

 

73,581

 

309,868

 

301,730

 

80,707

 

77,975

 

80,214

 

The Techs

 

162,541

 

180,451

 

669,608

 

664,485

 

151,137

 

179,217

 

176,713

 

Total

 

1,542,289

 

1,457,053

 

6,119,884

 

5,832,776

 

1,469,802

 

1,522,668

 

1,585,125

 

Intra-company

 

(118,336

)

(102,772

)

(491,252

)

(409,612

)

(125,370

)

(126,288

)

(121,258

)

External

 

1,423,953

 

1,354,281

 

5,628,632

 

5,423,164

 

1,344,432

 

1,396,380

 

1,463,867

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Production, excluding The Techs (tons)

 

1,424,492

 

1,290,567

 

5,595,918

 

5,228,190

 

1,407,508

 

1,329,322

 

1,434,596

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

$

1,222,907

 

$

1,126,438

 

$

4,768,004

 

$

4,782,240

 

$

1,142,075

 

$

1,165,775

 

$

1,237,247

 

Intra-company

 

(76,206

)

(65,019

)

(306,547

)

(275,452

)

(80,763

)

(74,760

)

(74,818

)

External

 

$

1,146,701

 

$

1,061,419

 

$

4,461,457

 

$

4,506,788

 

$

1,061,312

 

$

1,091,015

 

$

1,162,429

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income before amortization of intangibles

 

$

155,107

 

$

117,097

 

$

513,227

 

$

505,080

 

$

121,589

 

$

87,833

 

$

148,698

 

Amortization of intangibles

 

(2,133

)

(2,289

)

(8,843

)

(9,440

)

(2,288

)

(2,288

)

(2,134

)

Operating income (Note 1)

 

$

152,974

 

$

114,808

 

$

504,384

 

$

495,640

 

$

119,301

 

$

85,545

 

$

146,564

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Metals Recycling and Ferrous Resources Operations**

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OmniSource

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ferrous metals shipments (gross tons)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

1,356,258

 

1,238,143

 

5,505,995

 

5,647,058

 

1,342,929

 

1,334,390

 

1,472,418

 

Intra-company

 

(638,333

)

(573,293

)

(2,422,736

)

(2,586,670

)

(553,890

)

(548,268

)

(682,245

)

External

 

717,925

 

664,850

 

3,083,259

 

3,060,388

 

789,039

 

786,122

 

790,173

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nonferrous metals shipments (thousands of pounds)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

254,876

 

251,080

 

1,052,494

 

1,051,333

 

279,656

 

254,495

 

263,467

 

Intra-company

 

(3,738

)

(3,456

)

(18,450

)

(18,488

)

(3,529

)

(6,737

)

(4,446

)

External

 

251,138

 

247,624

 

1,034,044

 

1,032,845

 

276,127

 

247,758

 

259,021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mesabi Nugget shipments (metric tons) - Intra-company

 

59,460

 

36,481

 

215,833

 

168,633

 

59,685

 

44,454

 

52,234

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Iron Dynamics (metric tons) - Intra-company

 

57,659

 

57,117

 

255,303

 

226,396

 

64,685

 

66,285

 

66,674

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

$

907,668

 

$

798,163

 

$

3,663,486

 

$

3,658,952

 

$

914,568

 

$

893,116

 

$

948,134

 

Intra-company

 

(334,828

)

(267,905

)

(1,278,645

)

(1,316,354

)

(293,440

)

(307,624

)

(342,753

)

External

 

$

572,840

 

$

530,258

 

$

2,384,841

 

$

2,342,598

 

$

621,128

 

$

585,492

 

$

605,381

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating loss before amortization of intangibles

 

$

(13,020

)

$

507

 

$

(30,835

)

$

(11,690

)

$

(4,309

)

$

(1,811

)

$

(11,695

)

Amortization of intangibles

 

(5,238

)

(6,110

)

(21,633

)

(24,818

)

(5,515

)

(5,440

)

(5,440

)

Operating loss (Note 1)

 

$

(18,258

)

$

(5,603

)

$

(52,468

)

$

(36,508

)

$

(9,824

)

$

(7,251

)

$

(17,135

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Steel Fabrication Operations***

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shipments (tons)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

101,132

 

76,870

 

366,676

 

295,161

 

77,583

 

86,371

 

101,590

 

Intra-company

 

(98

)

(187

)

(1,030

)

(242

)

(334

)

(460

)

(138

)

External

 

101,034

 

76,683

 

365,646

 

294,919

 

77,249

 

85,911

 

101,452

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

$

121,853

 

$

98,301

 

$

439,655

 

$

371,406

 

$

94,375

 

$

104,159

 

$

119,268

 

Intra-company

 

(125

)

(277

)

(1,401

)

(322

)

(578

)

(564

)

(134

)

External

 

$

121,728

 

$

98,024

 

$

438,254

 

$

371,084

 

$

93,797

 

$

103,595

 

$

119,134

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss) (Note 1)

 

$

(122

)

$

1,448

 

$

7,003

 

$

2,114

 

$

1,530

 

$

2,330

 

$

3,265

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

*      Steel Operations include the company’s five steelmaking divisions and The Techs three galvanizing plants.

**    Metals Recycling and Ferrous Resources Operations include OmniSource; Iron Dynamics (all shipments are internal); and Minnesota Operations, including Mesabi Nugget (all shipments have been internal).

***  Steel Fabrication Operations include the company’s joist and deck fabrication operations.

(Note 1) Segment operating income (loss) excludes profit sharing expense.

 


 

Steel Dynamics, Inc.

CONSOLIDATED BALANCE SHEETS

(in thousands)

 

 

 

December 31,
2013

 

December 31,
2012

 

 

 

(unaudited)

 

 

 

Assets

 

 

 

 

 

Current assets

 

 

 

 

 

Cash and equivalents

 

$

395,156

 

$

375,917

 

Investments in short-term commercial paper

 

—

 

31,520

 

Accounts receivable, net

 

720,600

 

642,363

 

Inventories

 

1,314,747

 

1,202,507

 

Deferred income taxes

 

17,964

 

23,449

 

Other current assets

 

25,167

 

20,469

 

Total current assets

 

2,473,634

 

2,296,225

 

 

 

 

 

 

 

Property, plant and equipment, net

 

2,226,134

 

2,231,198

 

 

 

 

 

 

 

Restricted cash

 

23,827

 

27,749

 

 

 

 

 

 

 

Intangible assets, net

 

386,159

 

416,635

 

 

 

 

 

 

 

Goodwill

 

731,996

 

738,542

 

 

 

 

 

 

 

Other assets

 

91,256

 

105,067

 

Total assets

 

$

5,933,006

 

$

5,815,416

 

 

 

 

 

 

 

Liabilities and Equity

 

 

 

 

 

Current liabilities

 

 

 

 

 

Accounts payable

 

$

414,932

 

$

360,097

 

Income taxes payable

 

4,023

 

16,941

 

Accrued expenses

 

214,679

 

203,008

 

Current maturities of long-term debt

 

341,544

 

29,631

 

Total current liabilities

 

975,178

 

609,677

 

 

 

 

 

 

 

Long-term debt

 

 

 

 

 

Term note

 

220,000

 

247,500

 

Senior notes

 

1,500,000

 

1,600,000

 

Convertible senior notes

 

—

 

287,496

 

Other long-term debt

 

46,045

 

37,610

 

Total long-term debt

 

1,766,045

 

2,172,606

 

 

 

 

 

 

 

Deferred income taxes

 

556,038

 

537,304

 

Other liabilities

 

23,376

 

19,173

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

Redeemable noncontrolling interests

 

116,514

 

98,814

 

 

 

 

 

 

 

Equity

 

 

 

 

 

Common stock

 

645

 

637

 

Treasury stock, at cost

 

(718,529

)

(720,479

)

Additional paid-in capital

 

1,085,694

 

1,037,687

 

Retained earnings

 

2,179,513

 

2,087,620

 

Total Steel Dynamics, Inc. equity

 

2,547,323

 

2,405,465

 

Noncontrolling interests

 

(51,468

)

(27,623

)

Total equity

 

2,495,855

 

2,377,842

 

Total liabilities and equity

 

$

5,933,006

 

$

5,815,416

 

 


 

Steel Dynamics, Inc.

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(in thousands)

 

 

 

Three Months Ended

 

Year Ended

 

 

 

December 31,

 

December 31,

 

 

 

2013

 

2012

 

2013

 

2012

 

 

 

 

 

 

 

 

 

 

 

Operating activities:

 

 

 

 

 

 

 

 

 

Net income

 

$

47,901

 

$

55,094

 

$

163,516

 

$

142,281

 

 

 

 

 

 

 

 

 

 

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

58,839

 

55,189

 

230,928

 

225,216

 

Impairment charges

 

—

 

356

 

308

 

8,250

 

Equity-based compensation

 

5,892

 

3,018

 

15,504

 

12,481

 

Deferred income taxes

 

(871

)

64

 

30,737

 

54,528

 

Changes in certain assets and liabilities:

 

 

 

 

 

 

 

 

 

Accounts receivable

 

52,273

 

70,373

 

(78,237

)

85,977

 

Inventories

 

(118,385

)

7,143

 

(108,025

)

13,845

 

Accounts payable

 

(12,278

)

(13,578

)

40,141

 

(32,593

)

Income taxes receivable/payable

 

(2,522

)

4,727

 

(12,494

)

21,644

 

Other assets and liabilities

 

35,635

 

23,922

 

29,797

 

(85,935

)

Net cash provided by operating activities

 

66,484

 

206,308

 

312,175

 

445,694

 

 

 

 

 

 

 

 

 

 

 

Investing activities:

 

 

 

 

 

 

 

 

 

Purchase of property, plant and equipment

 

(40,099

)

(64,839

)

(186,843

)

(223,525

)

Other investing activities

 

(1,643

)

(32,527

)

33,998

 

31,924

 

Net cash used in investing activities

 

(41,742

)

(97,366

)

(152,845

)

(191,601

)

 

 

 

 

 

 

 

 

 

 

Financing activities:

 

 

 

 

 

 

 

 

 

Issuance of current and long-term debt

 

5,146

 

—

 

423,965

 

1,049,969

 

Repayment of current and long-term debt

 

(5,878

)

(6,640

)

(517,978

)

(1,258,842

)

Debt issuance costs

 

(3

)

(88

)

(6,195

)

(13,901

)

Proceeds from exercise of stock options, including related tax effect

 

18,992

 

1,641

 

37,508

 

3,662

 

Contributions from noncontrolling investors, net

 

6,449

 

6,865

 

17,421

 

37,808

 

Dividends paid

 

(24,348

)

(21,923

)

(94,812

)

(87,633

)

Net cash provided by (used in) financing activities

 

358

 

(20,145

)

(140,091

)

(268,937

)

 

 

 

 

 

 

 

 

 

 

Increase (decrease) in cash and equivalents

 

25,100

 

88,797

 

19,239

 

(14,844

)

Cash and equivalents at beginning of period

 

370,056

 

287,120

 

375,917

 

390,761

 

 

 

 

 

 

 

 

 

 

 

Cash and equivalents at end of period

 

$

395,156

 

$

375,917

 

$

395,156

 

$

375,917

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental disclosure information:

 

 

 

 

 

 

 

 

 

Cash paid for interest

 

$

22,109

 

$

30,163

 

$

129,499

 

$

154,136

 

Cash paid for federal and state income taxes, net

 

$

30,889

 

$

2,944

 

$

72,436

 

$

46,920