Note 11. 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 unsecured notes due 2019, 2021, 2022, 2023 and 2024. 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, which includes Columbus since acquired on September 16, 2014, (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 the company’s Annual Report on Form 10-K for the year ended December 31, 2014.

Condensed Consolidating Balance Sheets (in thousands)

						Combined			Consolidating			Total
	Parent			Guarantors		Non-Guarantors			Adjustments			Consolidated
As of June 30, 2015
Cash and equivalents	$	351,996		$	55,586	$	11,819		$	—		$	419,401
Accounts receivable, net	262,708			1,182,293		36,919			(665,398		)	816,522
Inventories	590,104			658,048		47,494			(3,577		)	1,292,069
Other current assets	69,807			7,343		4,436			(18,186		)	63,400

Total current assets	1,274,615			1,903,270		100,668			(687,161		)	2,591,392
Property, plant and equipment, net	979,749			1,769,536		300,229			(2,113		)	3,047,401
Intangible assets, net	—			358,402		—			—			358,402
Goodwill	—			741,898		—			—			741,898
Other assets, including investments in subs	3,573,407			23,085		6,491			(3,515,313		)	87,670

Total assets	$	5,827,771		$	4,796,191	$	407,388		$	(4,204,587	)	$	6,826,763


Accounts payable	$	140,249		$	314,074	$	89,416		$	(97,041	)	$	446,698
Accrued expenses	126,025			168,859		6,484			(84,553		)	216,815
Current maturities of long-term debt	13,097			809		61,445			(40,276		)	35,075

Total current liabilities	279,371			483,742		157,345			(221,870		)	698,588
Long-term debt	2,585,806			224		167,639			(134,095		)	2,619,574
Other liabilities	35,181			1,505,382		35,490			(992,152		)	583,901

Redeemable noncontrolling interests	—			—		125,972			—			125,972

Common stock	636			1,727,859		18,121			(1,745,980		)	636
Treasury stock	(396,491		)	—		—			—			(396,491		)
Additional paid-in-capital	1,099,669			117,737		641,858			(759,595		)	1,099,669
Retained earnings (deficit)	2,223,599			961,247		(610,352		)	(350,895		)	2,223,599

Total Steel Dynamics, Inc. equity	2,927,413			2,806,843		49,627			(2,856,470		)	2,927,413
Noncontrolling interests	—			—		(128,685		)	—			(128,685		)

Total equity	2,927,413			2,806,843		(79,058		)	(2,856,470		)	2,798,728

Total liabilities and equity	$	5,827,771		$	4,796,191	$	407,388		$	(4,204,587	)	$	6,826,763

Condensed Consolidating Balance Sheets (in thousands)

						Combined			Consolidating			Total
	Parent			Guarantors		Non-Guarantors			Adjustments			Consolidated
As of December 31, 2014
Cash and equivalents	$	265,313		$	81,690	$	14,360		$	—		$	361,363
Accounts receivable, net	321,493			1,176,849		44,696			(640,213		)	902,825
Inventories	662,970			862,796		94,916			(2,263		)	1,618,419
Other current assets	94,634			8,416		6,577			(18,469		)	91,158

Total current assets	1,344,410			2,129,751		160,549			(660,945		)	2,973,765
Property, plant and equipment, net	1,002,407			1,826,208		297,505			(2,214		)	3,123,906
Intangible assets, net	—			370,669		—			—			370,669
Goodwill	—			745,158		—			—			745,158
Other assets, including investments in subs	3,900,691			24,810		6,635			(3,834,607		)	97,529

Total assets	$	6,247,508		$	5,096,596	$	464,689		$	(4,497,766	)	$	7,311,027


Accounts payable	$	151,517		$	371,037	$	98,886		$	(110,384	)	$	511,056
Accrued expenses	191,433			166,101		11,695			(76,163		)	293,066
Current maturities of long-term debt	13,073			777		73,767			(41,157		)	46,460

Total current liabilities	356,023			537,915		184,348			(227,704		)	850,582
Long-term debt	2,942,360			624		158,665			(123,943		)	2,977,706
Other liabilities	36,110			1,807,989		28,719			(1,311,946		)	560,872

Redeemable noncontrolling interests	—			—		126,340			—			126,340

Common stock	635			1,727,859		18,121			(1,745,980		)	635
Treasury stock	(398,898		)	—		—			—			(398,898		)
Additional paid-in-capital	1,083,435			117,737		635,156			(752,893		)	1,083,435
Retained earnings (deficit)	2,227,843			904,472		(569,172		)	(335,300		)	2,227,843

Total Steel Dynamics, Inc. equity	2,913,015			2,750,068		84,105			(2,834,173		)	2,913,015
Noncontrolling interests	—			—		(117,488		)	—			(117,488		)

Total equity	2,913,015			2,750,068		(33,383		)	(2,834,173		)	2,795,527

Total liabilities and equity	$	6,247,508		$	5,096,596	$	464,689		$	(4,497,766	)	$	7,311,027

Condensed Consolidating Statements of Operations (in thousands)

							Combined			Consolidating			Total
	Parent			Guarantors			Non-Guarantors			Adjustments			Consolidated
For the three months ended, June 30, 2015
Net sales	$	766,056		$	2,153,141		$	101,880		$	(1,016,070	)	$	2,005,007
Costs of goods sold	669,259			2,019,025			134,335			(989,355		)	1,833,264

Gross profit (loss)	96,797			134,116			(32,455		)	(26,715		)	171,743
Selling, general and administrative	29,905			65,736			2,668			(4,125		)	94,184

Operating income (loss)	66,892			68,380			(35,123		)	(22,590		)	77,559
Interest expense, net of capitalized interest	18,166			18,376			1,658			(1,037		)	37,163
Other (income) expense, net	(773		)	(654		)	(822		)	1,037			(1,212		)

Income (loss) before income taxes and equity in net loss of subsidiaries	49,499			50,658			(35,959		)	(22,590		)	41,608
Income taxes (benefit)	8,097			19,172			(2,510		)	(8,476		)	16,283

	41,402			31,486			(33,449		)	(14,114		)	25,325
Equity in net loss of subsidiaries	(9,852		)	—			—			9,852			—
Net loss attributable to noncontrolling interests	—			—			6,225			—			6,225

Net income (loss) attributable to Steel Dynamics, Inc.	$	31,550		$	31,486		$	(27,224	)	$	(4,262	)	$	31,550

							Combined			Consolidating			Total
	Parent			Guarantors			Non-Guarantors			Adjustments			Consolidated
For the three months ended, June 30, 2014
Net sales	$	1,007,569		$	2,313,459		$	121,239		$	(1,372,506	)	$	2,069,761
Costs of goods sold	860,024			2,183,181			141,362			(1,337,577		)	1,846,990

Gross profit (loss)	147,545			130,278			(20,123		)	(34,929		)	222,771
Selling, general and administrative	35,419			56,411			3,406			(4,370		)	90,866

Operating income (loss)	112,126			73,867			(23,529		)	(30,559		)	131,905
Interest expense, net of capitalized interest	19,031			10,294			1,986			(1,261		)	30,050
Other (income) expense, net	(1,556		)	(46		)	(1,412		)	1,260			(1,754		)

Income (loss) before income taxes and equity in net income of subsidiaries	94,651			63,619			(24,103		)	(30,558		)	103,609
Income taxes (benefit)	23,950			23,076			814			(10,572		)	37,268

	70,701			40,543			(24,917		)	(19,986		)	66,341
Equity in net loss of subsidiaries	1,602			—			—			(1,602		)	—
Net loss attributable to noncontrolling interests	—			—			5,962			—			5,962

Net income (loss) attributable to Steel Dynamics, Inc.	$	72,303		$	40,543		$	(18,955	)	$	(21,588	)	$	72,303

						Combined			Consolidating			Total
	Parent			Guarantors		Non-Guarantors			Adjustments			Consolidated
For the six months ended, June 30, 2015
Net sales	$	1,564,774		$	4,344,150	$	206,453		$	(2,062,935	)	$	4,052,442
Costs of goods sold	1,362,834			4,091,150		253,116			(2,013,443		)	3,693,657

Gross profit (loss)	201,940			253,000		(46,663		)	(49,492		)	358,785
Selling, general and administrative	60,648			123,769		6,033			(8,995		)	181,455

Operating income (loss)	141,292			129,231		(52,696		)	(40,497		)	177,330
Interest expense, net of capitalized interest	38,703			40,216		3,392			(2,061		)	80,250
Other (income) expense, net	14,879			34		(1,994		)	2,061			14,980

Income (loss) before income taxes and equity in net loss of subsidiaries	87,710			88,981		(54,094		)	(40,497		)	82,100
Income taxes (benefit)	15,038			32,206		(3,626		)	(13,797		)	29,821

	72,672			56,775		(50,468		)	(26,700		)	52,279
Equity in net loss of subsidiaries	(10,361		)	—		—			10,361			—
Net loss attributable to noncontrolling interests	—			—		10,032			—			10,032

Net income (loss) attributable to Steel Dynamics, Inc.	$	62,311		$	56,775	$	(40,436	)	$	(16,339	)	$	62,311

						Combined			Consolidating			Total
	Parent			Guarantors		Non-Guarantors			Adjustments			Consolidated
For the six months ended, June 30, 2014
Net sales	$	1,871,132		$	4,425,848	$	227,088		$	(2,624,225	)	$	3,899,843
Costs of goods sold	1,621,419			4,198,757		264,935			(2,571,343		)	3,513,768

Gross profit (loss)	249,713			227,091		(37,847		)	(52,882		)	386,075
Selling, general and administrative	64,253			110,700		6,814			(8,529		)	173,238

Operating income (loss)	185,460			116,391		(44,661		)	(44,353		)	212,837
Interest expense, net of capitalized interest	38,392			20,855		3,866			(2,494		)	60,619
Other (income) expense, net	(2,532		)	349		(2,696		)	2,494			(2,385		)

Income (loss) before income taxes and equity in net loss of subsidiaries	149,600			95,187		(45,831		)	(44,353		)	154,603
Income taxes (benefit)	33,875			34,018		1,510			(14,839		)	54,564

	115,725			61,169		(47,341		)	(29,514		)	100,039
Equity in net loss of subsidiaries	(4,843		)	—		—			4,843			—
Net loss attributable to noncontrolling interests	—			—		10,843			—			10,843

Net income (loss) attributable to Steel Dynamics, Inc.	$	110,882		$	61,169	$	(36,498	)	$	(24,671	)	$	110,882

Condensed Consolidating Statements of Cash Flows (in thousands)

							Combined			Consolidating			Total
	Parent			Guarantors			Non-Guarantors			Adjustments			Consolidated

For the six months ended, June 30, 2015
Net cash provided by operating activities	$	212,624		$	322,486		$	246		$	8,563		$	543,919
Net cash used in investing activities	(31,419		)	(18,495		)	(13,260		)	9,471			(53,703		)
Net cash provided by (used in) financing activities	(94,522		)	(330,095		)	10,473			(18,034		)	(432,178		)

Increase (decrease) in cash and equivalents	86,683			(26,104		)	(2,541		)	—			58,038
Cash and equivalents at beginning of period	265,313			81,690			14,360			—			361,363

Cash and equivalents at end of period	$	351,996		$	55,586		$	11,819		$	—		$	419,401

							Combined			Consolidating			Total
	Parent			Guarantors			Non-Guarantors			Adjustments			Consolidated

For the six months ended, June 30, 2014
Net cash provided by (used in) operating activities	$	94,219		$	(19,938	)	$	(23,559	)	$	(1,955	)	$	48,767
Net cash used in investing activities	(34,747		)	(10,007		)	(13,076		)	30,653			(27,177		)
Net cash provided by (used in) financing activities	(83,113		)	19,258			33,297			(28,698		)	(59,256		)

Decrease in cash and equivalents	(23,641		)	(10,687		)	(3,338		)	—			(37,666		)
Cash and equivalents at beginning of period	320,866			61,148			13,142			—			395,156

Cash and equivalents at end of period	$	297,225		$	50,461		$	9,804		$	—		$	357,490