Note 10. Condensed Consolidating Information

Certain 100% owned subsidiaries of SDI have fully and unconditionally guaranteed jointly and severally all of the indebtedness relating to the issuance of the company’s senior unsecured notes due 2021, 2023, 2024, 2025 and 2026. 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 the company’s Annual Report on Form 10-K for the year ended December 31, 2017.



Condensed Consolidating Balance Sheets (in thousands)
					Combined		Consolidating		Total
As of March 31, 2018	Parent		Guarantors		Non-Guarantors		Adjustments		Consolidated
Cash and equivalents	$	969,240	$	9,294	$	7,290	$	-	$	985,824
Short term investments		40,000		-		-		-		40,000
Accounts receivable, net		349,276		1,475,249		33,922		(870,792)		987,655
Inventories		743,939		804,504		59,192		(7,577)		1,600,058
Other current assets		23,717		14,814		5,095		(4,921)		38,705
Total current assets		2,126,172		2,303,861		105,499		(883,290)		3,652,242
Property, plant and equipment, net		854,685		1,605,485		197,767		-		2,657,937
Intangible assets, net		-		219,374		30,609		-		249,983
Goodwill		-		378,221		7,824		-		386,045
Other assets, including investments in subs		2,486,756		6,081		5,588		(2,471,819)		26,606
Total assets	$	5,467,613	$	4,513,022	$	347,287	$	(3,355,109)	$	6,972,813

Accounts payable	$	185,459	$	363,178	$	87,276	$	(73,295)	$	562,618
Accrued expenses		185,020		232,542		11,103		(140,189)		288,476
Current maturities of long-term debt		746		-		36,761		(27,861)		9,646
Total current liabilities		371,225		595,720		135,140		(241,345)		860,740
Long-term debt		2,327,621		-		167,787		(141,705)		2,353,703
Other liabilities		(701,952)		775,007		22,547		239,391		334,993
Total liabilities		1,996,894		1,370,727		325,474		(143,659)		3,549,436

Redeemable noncontrolling interests		-		-		111,240		-		111,240

Common stock		644		1,727,859		15,016		(1,742,875)		644
Treasury stock		(730,700)		-		-		-		(730,700)
Additional paid-in-capital		1,142,871		128,076		803,204		(931,280)		1,142,871
Retained earnings (deficit)		3,057,904		1,286,360		(749,065)		(537,295)		3,057,904
Total Steel Dynamics, Inc. equity		3,470,719		3,142,295		69,155		(3,211,450)		3,470,719
Noncontrolling interests		-		-		(158,582)		-		(158,582)
Total equity		3,470,719		3,142,295		(89,427)		(3,211,450)		3,312,137
Total liabilities and equity	$	5,467,613	$	4,513,022	$	347,287	$	(3,355,109)	$	6,972,813

Note 10. Condensed Consolidating Information (Continued)



					Combined		Consolidating		Total
As of December 31, 2017	Parent		Guarantors		Non-Guarantors		Adjustments		Consolidated
Cash and equivalents	$	1,001,405	$	20,441	$	6,803	$	-	$	1,028,649
Accounts receivable, net		274,968		1,426,036		37,387		(869,554)		868,837
Inventories		685,103		752,151		91,890		(9,797)		1,519,347
Other current assets		73,748		16,005		5,962		(4,206)		91,509
Total current assets		2,035,224		2,214,633		142,042		(883,557)		3,508,342
Property, plant and equipment, net		859,419		1,618,438		198,047		-		2,675,904
Intangible assets, net		-		225,503		31,406		-		256,909
Goodwill		-		379,069		7,824		-		386,893
Other assets, including investments in subs		2,512,594		6,622		5,505		(2,497,037)		27,684
Total assets	$	5,407,237	$	4,444,265	$	384,824	$	(3,380,594)	$	6,855,732

Accounts payable	$	168,282	$	316,676	$	101,948	$	(97,458)	$	489,448
Accrued expenses		222,023		254,196		10,243		(136,186)		350,276
Current maturities of long-term debt		731		-		56,454		(28,390)		28,795
Total current liabilities		391,036		570,872		168,645		(262,034)		868,519
Long-term debt		2,326,466		-		169,799		(143,120)		2,353,145
Other liabilities		(661,839)		869,196		24,868		95,535		327,760
Total liabilities		2,055,663		1,440,068		363,312		(309,619)		3,549,424

Redeemable noncontrolling interests		-		-		111,240		-		111,240

Common stock		644		1,727,859		14,908		(1,742,767)		644
Treasury stock		(665,297)		-		-		-		(665,297)
Additional paid-in-capital		1,141,534		128,076		797,196		(925,272)		1,141,534
Retained earnings (deficit)		2,874,693		1,148,262		(745,326)		(402,936)		2,874,693
Total Steel Dynamics, Inc. equity		3,351,574		3,004,197		66,778		(3,070,975)		3,351,574
Noncontrolling interests		-		-		(156,506)		-		(156,506)
Total equity		3,351,574		3,004,197		(89,728)		(3,070,975)		3,195,068
Total liabilities and equity	$	5,407,237	$	4,444,265	$	384,824	$	(3,380,594)	$	6,855,732

Note 10. Condensed Consolidating Information (Continued)



Condensed Consolidating Statements of Operations (in thousands)

For the three months ended,					Combined		Consolidating		Total
March 31, 2018	Parent		Guarantors		Non-Guarantors		Adjustments		Consolidated
Net sales	$	1,036,674	$	2,823,129	$	152,587	$	(1,408,515)	$	2,603,875
Costs of goods sold		819,145		2,551,620		148,630		(1,378,936)		2,140,459
Gross profit		217,529		271,509		3,957		(29,579)		463,416
Selling, general and administrative		62,927		76,952		5,597		(5,457)		140,019
Operating income (loss)		154,602		194,557		(1,640)		(24,122)		323,397
Interest expense, net of capitalized interest		18,623		12,437		3,540		(2,704)		31,896
Other expense (income), net		(5,203)		(1,697)		(273)		2,710		(4,463)
Income (loss) before income taxes and
equity in net income of subsidiaries		141,182		183,817		(4,907)		(24,128)		295,964
Income taxes		29,746		45,720		909		(5,886)		70,489
		111,436		138,097		(5,816)		(18,242)		225,475
Equity in net income of subsidiaries		116,115		-		-		(116,115)		-
Net loss attributable to noncontrolling interests		-		-		2,076		-		2,076
Net income (loss) attributable to Steel Dynamics, Inc.	$	227,551	$	138,097	$	(3,740)	$	(134,357)	$	227,551



For the three months ended,					Combined		Consolidating		Total
March 31, 2017	Parent		Guarantors		Non-Guarantors		Adjustments		Consolidated
Net sales	$	924,566	$	2,572,238	$	143,408	$	(1,271,996)	$	2,368,216
Costs of goods sold		711,579		2,289,664		138,041		(1,243,222)		1,896,062
Gross profit		212,987		282,574		5,367		(28,774)		472,154
Selling, general and administrative		61,655		76,282		5,053		(5,402)		137,588
Operating income		151,332		206,292		314		(23,372)		334,566
Interest expense, net of capitalized interest		18,081		15,123		3,266		(2,497)		33,973
Other expense (income), net		(3,254)		(2,667)		(236)		2,498		(3,659)
Income (loss) before income taxes and
equity in net income of subsidiaries		136,505		193,836		(2,716)		(23,373)		304,252
Income taxes		41,585		70,311		1,790		(8,100)		105,586
		94,920		123,525		(4,506)		(15,273)		198,666
Equity in net income of subsidiaries		105,897		-		-		(105,897)		-
Net loss attributable to noncontrolling interests		-		-		2,151		-		2,151
Net income (loss) attributable to Steel Dynamics, Inc.	$	200,817	$	123,525	$	(2,355)	$	(121,170)	$	200,817

Note 10. Condensed Consolidating Information (Continued)


Condensed Consolidating Statements of Cash Flows (in thousands)

For the three months ended,					Combined		Consolidating		Total
March 31, 2018	Parent		Guarantors		Non-Guarantors		Adjustments		Consolidated
Net cash provided by operating activities	$	9,009	$	149,336	$	21,283	$	(1,693)	$	177,935
Net cash used in investing activities		(60,919)		(24,517)		(2,997)		(1,944)		(90,377)
Net cash provided by (used in) financing activities		18,920		(135,966)		(17,813)		3,637		(131,222)
Increase (decrease) in cash and equivalents		(32,990)		(11,147)		473		-		(43,664)
Cash, cash equivalents, and restricted cash at beginning of
period		1,002,230		20,740		12,115		-		1,035,085
Cash, cash equivalents, and restricted cash at end of period	$	969,240	$	9,593	$	12,588	$	-	$	991,421



For the three months ended,					Combined		Consolidating		Total
March 31, 2017	Parent		Guarantors		Non-Guarantors		Adjustments		Consolidated
Net cash provided by (used in) operating activities	$	102,209	$	132,733	$	(877)	$	6,365	$	240,430
Net cash used in investing activities		(19,409)		(1,510)		(192)		6,352		(14,759)
Net cash provided by (used in) financing activities		86,776		(174,914)		508		(12,717)		(100,347)
Increase (decrease) in cash and equivalents		169,576		(43,691)		(561)		-		125,324
Cash, cash equivalents, and restricted cash at beginning of
period		767,594		54,859		25,652		-		848,105
Cash, cash equivalents, and restricted cash at end of period	$	937,170	$	11,168	$	25,091	$	-	$	973,429