EX-13 5 0005.txt ANNUAL REPORT At A Glance 8 [GRAPHIC]
BAR MILL GROUP BEAM MILL COLD FINISH GROUP Products: Steel bars, angles and Products: Wide flange steel Products: Cold finished steel other products for automotive, farm beams, pilings, heavy bars for shafting and machinery, metal buildings, structural steel products for precision machined parts. furniture, recreational equipment fabricators, manufacturers and and other categories. steel service centers. Norfolk, Nebraska Darlington, South Carolina Darlington, South Carolina Mt. Pleasant, South Carolina Brigham City, Utah Norfolk, Nebraska Jewett, Texas PLATE MILL BUILDING SYSTEMS GROUP Plymouth, Utah Products: Steel plate for Products: Metal buildings and manufacturers of rail cars, metal building components for SHEET MILL GROUP ships and barges, refinery commercial, industrial and Products: Flat-rolled steel for tanks and others. institutional building markets. appliances, pipes and tubes, construction and other industries. Winton, North Carolina Waterloo, Indiana Swansea, South Carolina Crawfordsville, Indiana VULCRAFT GROUP Terrell, Texas Hickman, Arkansas Products: Steel joists, Mt. Pleasant, South Carolina joist girders and steel FASTENER DIVISION deck for buildings. Products: Steel hexhead cap NUCOR-YAMATO screws, structural bolts and hex STEEL COMPANY Florence, South Carolina bolts for automotive, machine Products: Super-wide flange Norfolk, Nebraska tool, farm implements, construction steel beams, pilings, heavy Fort Payne, Alabama and military applications. structural steel products for Grapeland, Texas fabricators, manufacturers and St. Joe, Indiana St. Joe, Indiana steel service centers. Brigham City, Utah Chemung, New York CORPORATE OFFICE Blytheville, Arkansas (Vulcraft of New York, Inc.) Charlotte, North Carolina
OPERATIONS REVIEW 9 -------------------------------------------------------------------------------- BAR MILL GROUP, SHEET MILL GROUP, STRUCTURAL MILLS AND PLATE MILL The manufacture of steel is a major area of operations for Nucor. Nucor operates scrap-based steel mills in ten locations. These mills utilize modern steelmaking techniques and produce steel at a cost competitive with steel manufactured anywhere in the world. -------------------------------------------------------------------------------- BAR MILL GROUP The Bar Mill Group has four mills located in South Carolina, Nebraska, Texas and Utah that produce bars, angles and light structural carbon and alloy steels. These bar products have wide usage including automotive, farm equipment, metal buildings, furniture and recreational equipment. In constructing Nucor steel mills, capital cost per ton of capacity has been lower than the capital cost generally required for other steel mills. The first facility of the Nucor Bar Mill Group was constructed in 1969 and has been extensively modernized. The next three bar mills were constructed between 1973 and 1981. The total capital cost of all four bar mills averaged about $170 per ton of current annual capacity. Total capacity of the four bar mills exceeds 3,000,000 tons per year. SHEET MILL GROUP The Sheet Mill Group produces flat-rolled steel for appliances, pipes and tubes, construction and other industries. The three sheet mills are located in Indiana, Arkansas and South Carolina. The Nucor sheet mills were constructed between 1989 and 1996. The total cost of these sheet mills averaged about $305 per ton of current annual capacity. The sheet mills utilize thin slab casters to produce hot rolled sheet which can be further processed through cold rolling and galvanizing. Nucor's sheet mills have a lower capital cost than integrated steel mills producing these products. Total capacity of the sheet mills is about 5,900,000 tons per year. STRUCTURAL MILLS The Structural Mills produce wide flange steel beams, pilings and heavy structural steel products for construction companies. In 1988, Nucor and Yamato Kogyo, one of Japan's major producers of wide-flange beams, completed construction of a beam mill located near Blytheville, Arkansas. Nucor owns a 51% interest in Nucor-Yamato Steel Company. During 1999, Nucor started operations at its 500,000 tons-per-year steel beam mill in South Carolina. Both mills use a special continuous casting method that produces a beam blank closer in shape to that of the finished beam than traditional methods. Current annual production capacity of the structural mills is about 2,900,000 tons. The total capital cost of the two structural mills averaged about $265 per ton of current capacity. PLATE MILL Nucor's Plate Mill is located in North Carolina and produces steel plate for manufacturers of rail cars, ships, barges, refinery tanks and others. During 2000, Nucor substantially completed construction of the 1,000,000 tons-per-year steel plate mill. Casting and rolling began in October 2000. The start-up has been extremely successful and the mill is producing high quality plate. OPERATIONS REVIEW 10 OPERATIONS Nucor's steel mills are among the most modern and efficient mills in the United States. Steel scrap is melted in electric arc furnaces and poured into continuous casting systems. Highly sophisticated rolling mills convert the billets and slabs into angles, rounds, channels, flats, sheet, beams, plate and other products. Production in 2000 was a record 11,271,000 tons, a 9% increase from 10,376,000 tons in 1999. Annual production capacity has grown from 120,000 tons in 1970 to a present total of about 13,000,000 tons. The operations in the rolling mills are highly automated and require fewer operating employees than older mills. All Nucor steel mills have high productivity, which results in employment costs of approximately 10% of the sales dollar. This is lower than the employment costs of integrated steel companies producing comparable products. Employee turnover in all mills is extremely low. All employees have a significant part of their compensation based on their productivity. Production employees work under group incentives that provide increased earnings for increased production. This additional compensation is paid weekly. Steel mills are large consumers of electricity and gas. However, because of the high efficiency of Nucor steel mills, these energy costs were less than 10% of the sales dollar in 2000. Scrap and scrap substitutes are the most significant element in the total cost of steel. Their average cost increased to about $120 per gross ton used in 2000 from $111 per gross ton used in 1999. MARKETS AND MARKETING About 87% of the ten steel mills' production in 2000 was sold to outside customers and the balance was used internally by the Vulcraft Group, Cold Finish Group, Building Systems Group and Fastener Division. Steel sales to outside customers in 2000 were a record 9,779,000 tons, 12% higher than the 8,734,000 tons in 1999. The Bar Mill and Sheet Mill Groups' customers are primarily manufacturers and steel service centers. The Structural and Plate Mills' customers are primarily fabricators, manufacturers and steel service centers. Nucor uses a simple, highly competitive pricing system that is less complicated than the pricing structure traditional in the steel industry. For the bar and structural mills, all customers in a region are charged the same published price. This allows customers to maintain the lowest practical inventory. Because of the specialized requirements of many customers of the sheet mills, pricing can vary due to the additional costs of accommodating these requirements. NEWER FACILITIES AND EXPANSIONS In 1998, Nucor substantially completed construction and started operations of a major addition to Nucor's Hickman, Arkansas steel sheet mill. This addition includes an 800,000 tons-per-year cold rolling facility; a 500,000 tons-per-year galvanizing facility; and associated pickling, oiling, and annealing facilities. During 1999, Nucor completed construction and started operations of the 500,000 tons-per-year steel beam mill in South Carolina. During 2000, Nucor started operations of the second caster addition at the steel sheet mill in South Carolina. This addition cost more than $40,000,000 and increased this mill's hot-band capacity from 1,500,000 tons to 2,300,000 tons per year. Also during 2000, construction began on a second cold rolling facility at the South Carolina sheet mill, which will increase this mill's cold rolled steel capacity from 750,000 tons to 1,500,000 tons per year, at a cost of about $40,000,000. Start-up should begin in the second quarter of 2001. The steel plate mill in North Carolina started casting and rolling in October 2000. This facility, which has an annual capacity of 1,000,000 tons, cost about $450,000,000. OPERATIONS REVIEW 11 [BAR CHARTS APPEAR HERE] OUTLOOK FOR THE FUTURE The manufacture of steel will continue to be a key factor in Nucor's future performance. Total steel production is anticipated to increase significantly over the next several years from the 11,271,000 tons produced in 2000. Nucor anticipates additional expansions at our existing steel mills, which could increase annual capacity to more than 13,000,000 tons per year. Nucor also expects to obtain additional capacity through greenfield construction and acquisitions. Although difficult business conditions that began in the second half of 2000 are expected to continue through the first half of 2001, Nucor expects to continue to generate above-average earnings from its steelmaking operations in the future. OPERATIONS REVIEW 12 The VULCRAFT GROUP is the nation's largest producer of open-web steel joists, joist girders and steel deck, which are used for building construction. This is a major area of operations for Nucor. OPERATIONS Steel joists and joist girders are produced and marketed nationally through six Vulcraft facilities located in South Carolina, Nebraska, Alabama, Texas, Indiana and Utah. Current annual production capacity is more than 650,000 tons. In 2000, Vulcraft produced 613,000 tons of steel joists and joist girders, a decrease from the record 616,000 tons produced in 1999. Materials, primarily steel, were about 40% of the joist sales dollar in 2000. The Vulcraft Group obtained almost 90% of its steel requirements from the Nucor Bar Mill Group. For 2000, freight costs for joists and joist girders were less than 10% of the sales dollar. Vulcraft maintains an extensive fleet of trucks to ensure and control on-time delivery. The Vulcraft facilities in South Carolina, Nebraska, Alabama, Texas and Indiana produce steel deck. Current deck annual production capacity is about 380,000 tons. Vulcraft steel deck sales decreased 6% from 375,000 tons in 1999 to 353,000 tons in 2000. Coiled sheet steel was about 65% of the steel deck sales dollar in 2000. Almost all of the production employees of Vulcraft work with a group incentive system, which provides increased compensation each week for increased performance. During 2000, Nucor began construction on a Vulcraft facility in Chemung, New York (Vulcraft of New York, Inc.) This facility will produce steel joists, joist girders and steel deck and should cost about $50,000,000. Start-up is anticipated in the third quarter of 2001. MARKETS Steel joists, joist girders and steel decking are used extensively as part of the roof and floor support systems in manufacturing buildings, retail stores, shopping centers, warehouses, schools, churches, hospitals and, to a lesser extent, in multi-story buildings and apartments. Building support systems using joists, joist girders and steel deck are frequently more economical than other systems. Steel joists and joist girder sales are obtained by competitive bidding. Vulcraft quotes on an estimated 80% to 90% of the domestic buildings using steel joists, joist girders and steel deck as part of the support systems. In 2000, Vulcraft supplied more than an estimated 40% of total domestic sales of steel joists. Steel deck is specified in the majority of buildings using steel joists and joist girders. In 2000, Vulcraft supplied more than 30% of total domestic sales of steel deck. Sales of steel joists, joist girders and steel deck are dependent on the non-residential building construction market. OPERATIONS REVIEW 13 [BAR CHART APPEARS HERE] OUTLOOK FOR THE FUTURE The increased level of construction in recent years has favorably impacted the volume of non-residential buildings supplied by the Vulcraft Group. Prevailing economic projections call for a slow-down of building construction in 2001, which will affect the sales of steel joists, joist girders and steel deck and the earnings of Vulcraft. OPERATIONS REVIEW 14 -------------------------------------------------------------------------------- COLD FINISH GROUP, BUILDING SYSTEMS GROUP AND FASTENER DIVISION Nucor manufactures a variety of products using steel from Nucor mills. -------------------------------------------------------------------------------- COLD FINISH GROUP The Cold Finish Group has facilities in Nebraska, South Carolina and Utah. These facilities produce cold drawn and turned, ground and polished steel bars that are used extensively for shafting and machined precision parts. The Cold Finish Group produces rounds, hexagons, flats and squares in carbon and alloy steels. The total capacity of all three facilities is about 350,000 tons per year. All three facilities are among the most modern in the world and use in-line electronic testing to ensure outstanding quality. Nucor Cold Finish obtains most of its steel from members of the Nucor Steel Mill Group. This factor, along with the efficient facilities, results in highly competitive pricing. In 2000, sales of cold finished steel products were 250,000 tons, an increase of 3% from 1999's 243,000 tons. The total cold finish market is estimated to be more than 1,800,000 tons. The Cold Finish Group anticipates opportunities for significant increases in sales and earnings during the next several years. BUILDING SYSTEMS GROUP The Building Systems Group produces pre-engineered metal building systems and components in Indiana, South Carolina and Texas. With the start-up of the building systems facility in Terrell, Texas during 2000, the annual capacity is now more than 145,000 tons. The size of the buildings that can be produced ranges from less than 500 square feet to more than 1,000,000 square feet. The buildings are sold through a builder distribution network in order to provide fast-track, customized solutions for building owners. Building systems sales in 2000 were about 79,000 tons, an increase of 19% from 1999's 66,000 tons. The primary markets are commercial, industrial and institutional buildings. The Building Systems Group obtains a significant portion of its steel requirements from the Nucor Bar and Sheet Mill Groups. FASTENER DIVISION Nucor Fastener's state-of-the-art steel bolt-making facility in Indiana produces standard steel hexhead cap screws hex bolts, socket head cap screws and structural bolts. Fasteners are used in a broad range of markets, including automotive, machine tools, farm implements, construction and military applications. Annual capacity is more than 75,000 tons, which is less than an estimated 20% of the total market for these products. The modern facility allows Nucor Fastener to maintain highly competitive pricing in a market currently dominated by foreign suppliers. This operation is highly automated and has fewer employees than comparable facilities. The Fastener Division obtains much of its steel from the Nucor Bar Mill Group. [BAR CHART APPEARS HERE] ANALYSIS OF OPERATIONS AND FINANCES 15 OPERATIONS Nucor's business is the manufacture of steel products. During the last five years, the sales of Nucor have increased 32% from $3,462,000,000 in 1995 to $4,586,000,000 in 2000. All of this growth has been internally generated. Net sales increased by 14% from 1999 to 2000, with more than 55% of the increase due to increased volume, with additional benefit derived from increased sales prices. 2000 was a record year for sales, primarily due to the performance in the first half of the year. In the second half of 2000, demand decreased and import levels increased significantly. The decrease in 1999 and 1998 sales resulted from decreased sales prices. During 1998, 1999 and 2000, imports of steel increased significantly, much of it at dumping prices. The effects of these imports decreased during the latter part of 1999, but increased during 2000. The major component of cost of products sold is raw material costs. The average price of raw materials increased by less than 10% in 2000, decreased by 20% in 1999, and was substantially unchanged in 1998. The average scrap and scrap substitute cost per ton used was $120 in 2000, $111 in 1999 and $142 in 1998. By the end of the fourth quarter of 2000, the average scrap cost per ton used had decreased to $109. The major components of marketing, administrative and other expenses are freight and profit sharing costs. Unit freight costs increased less than 5% in 2000, were substantially unchanged in 1999 and increased slightly in 1998. Profit sharing costs increased by 46% in 2000, decreased by 17% in 1999 and decreased by 15% in 1998. Profit sharing costs are based upon and fluctuate with pre-tax earnings. In 2000, profit sharing costs included over $6,200,000 for an extraordinary bonus paid to employees for the achievement of record earnings during the year. Every employee except for senior officers received $800. Interest income, net of interest expense, decreased in 2000 as a result of increased long-term debt and decreased average short-term investments. The increases in 1999 and 1998 resulted from increased average short-term investments. Federal income taxes were at a rate of 35% for 2000, 35.5% for 1999 and 36.5% for 1998. The increase in 2000 earnings resulted primarily from increased margins and increased volume. The decrease in 1999 earnings resulted primarily from decreased sales prices. The decrease in 1998 earnings resulted primarily from decreased margins and increased pre-operating and start-up costs of new facilities. Earnings were 14% of average equity in 2000, compared with 11% in 1999 and 13% in 1998 LIQUIDITY AND CAPITAL RESOURCES In 2000, working capital decreased 18% from $1,007,500,000 to $823,400,000, due primarily to decreased cash and short-term investments resulting from the acquisition of treasury stock. The current ratio was 2.5 in 2000, 2.9 in 1999 and 2.3 in 1998. In 2000, inventories decreased slightly due to the decline in raw material costs at the end of the year. The increase in 1999 and 1998 inventories was due primarily to an increase in quantities of work-in-process and finished goods. Capital expenditures are primarily for new facilities and expansion of existing facilities. These expenditures were $415,400,000 in 2000, $374,700,000 in 1999 and $502,900,000 in 1998. Capital expenditures are currently projected to be less than $300,000,000 in 2001. Funds provided from operations, existing credit facilities and new borrowings are expected to be adequate to meet future capital expenditure and working capital requirements. Net long-term debt borrowings were $70,000,000 in 2000, $175,000,000 in 1999 and $47,250,000 in 1998. Unused long-term credit facilities totaled $248,000,000 at the end of 2000. The percentage of long-term debt to total capital (long-term debt plus minority interests plus stockholders' equity) was 16% in 2000, 13% in 1999 and 8% in 1998. Nucor's objective is to maintain a strong balance sheet. Nucor has the financial ability to borrow significant additional funds and still maintain reasonable leverage. During 2000, Nucor negotiated a comprehensive agreement with the United States Environmental Protection Agency. The cost of complying with the terms of this decree will not impact liquidity. Nucor's directors have approved the purchase of up to 15,000,000 shares of Nucor common stock. During 1998, 1999 and 2000, Nucor repurchased approximately 10,800,000 shares at a cost of approximately $445,000,000. SIX-YEAR FINANCIAL REVIEW 18 ------------------------------------------------------------------------------------------------------------------ 2000 1999 1998 1997 ------------------------------------------------------------------------------------------------------------------ For the year Net sales $ 4,586,145,981 $ 4,009,346,082 $ 4,151,232,283 $ 4,184,497,854 Costs and expenses: Cost of products sold 3,925,478,540 3,480,478,687 3,591,782,838 3,578,941,039 Marketing, administrative and other expenses 183,175,557 154,773,600 147,973,101 145,409,693 Interest expense (income) (816,104) (5,095,299) (3,832,252) (35,318) --------------- ------------------ ----------------- --------------- 4,107,837,993 3,630,156,988 3,735,923,687 3,724,315,414 Earnings before federal income taxes 478,307,988 379,189,094 415,308,596 460,182,440 Federal income taxes 167,400,000 134,600,000 151,600,000 165,700,000 --------------- ------------------ ----------------- --------------- Net earnings 310,907,988 244,589,094 263,708,596 294,482,440 Net earnings per share 3.80 2.80 3.00 3.35 Dividends declared per share .60 .52 .48 .40 Percentage of earnings to sales 6.8% 6.1% 6.4% 7.0% Return on average equity 14.2% 11.3% 13.4% 16.9% Capital expenditures 415,404,602 374,717,759 502,910,263 306,749,422 Depreciation 259,365,173 256,637,460 253,118,608 218,764,101 Sales per employee 597,193 547,762 591,596 622,554 ------------------------------------------------------------------------------------------------------------------ At Year End Current assets $ 1,381,446,907 $ 1,538,508,511 $ 1,129,467,383 $ 1,125,508,464 Current liabilities 558,068,452 531,030,898 486,897,157 524,453,610 --------------- ------------------ ----------------- --------------- Working capital 823,378,455 1,007,477,613 642,570,226 601,054,854 Current ratio 2.5 2.9 2.3 2.1 Property, plant and equipment 2,340,340,812 2,191,339,477 2,097,078,473 1,858,874,894 Total assets 3,721,787,719 3,729,847,988 3,226,545,856 2,984,383,358 Long-term debt 460,450,000 390,450,000 215,450,000 167,950,000 Percentage of debt to capital 15.9% 13.3% 8.4% 7.2% Stockholders' equity 2,130,951,640 2,262,247,906 2,072,551,781 1,876,425,866 Per share 27.47 25.96 23.73 21.32 Shares outstanding 77,582,948 87,133,737 87,352,906 87,996,583 Stockholders 51,000 55,000 62,000 50,000 Employees 7,900 7,500 7,200 6,900 ------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------- 1996 1995 ----------------------------------------------------------------------- For the year Net sales $ 3,647,030,387 $ 3,462,045,648 Costs and expenses: Cost of products sold 3,139,157,919 2,900,168,171 Marketing, administrative and other expenses 120,387,357 130,677,162 Interest expense (income) (283,837) (1,134,190) --------------- ---------------- 3,259,261,439 3,029,711,143 Earnings before federal income taxes 387,768,948 432,334,505 Federal income taxes 139,600,000 157,800,000 --------------- ---------------- Net earnings 248,168,948 274,534,505 Net earnings per share 2.83 3.14 Dividends declared per share .32 .28 Percentage of earnings to sales 6.8% 7.9% Return on average equity 16.6% 21.9% Capital expenditures 537,438,406 263,421,786 Depreciation 182,232,851 173,887,657 Sales per employee 572,038 570,353 ----------------------------------------------------------------------- At Year End Current assets $ 828,380,585 $ 830,741,318 Current liabilities 465,652,755 447,136,311 --------------- ---------------- Working capital 362,727,830 383,605,007 Current ratio 1.8 1.9 Property, plant and equipment 1,791,152,821 1,465,400,015 Total assets 2,619,533,406 2,296,141,333 Long-term debt 152,600,000 106,850,000 Percentage of debt to capital 7.5% 6.2% Stockholders' equity 1,609,290,193 1,382,112,159 Per share 18.33 15.78 Shares outstanding 87,795,947 87,598,517 Stockholders 39,000 39,000 Employees 6,600 6,200 -----------------------------------------------------------------------
CONSOLIDATED STATEMENTS OF EARNINGS AND STOCKHOLDERS EQUITY 19
Consolidated Statements of Earnings ------------------------------------------------------------------------------------------------------------------------------------ Year Ended December 31, 2000 1999 1998 ------------------------------------------------------------------------------------------------------------------------------------ Net sales $ 4,586,145,981 $4,009,346,082 $4,151,232,283 ---------------- -------------- -------------- Costs and expenses: Cost of products sold 3,925,478,540 3,480,478,687 3,591,782,838 Marketing, administrative and other expenses 183,175,557 154,773,600 147,973,101 Interest expense (income) (Note 9) (816,104) (5,095,299) (3,832,252) ---------------- -------------- -------------- 4,107,837,993 3,630,156,988 3,735,923,687 ---------------- -------------- -------------- Earnings before federal income taxes 478,307,988 379,189,094 415,308,596 Federal income taxes (Note 10) 167,400,000 134,600,000 151,600,000 ---------------- -------------- -------------- Net earnings $ 310,907,988 $ 244,589,094 $ 263,708,596 ================ ============== ============== Net earnings per share (Note 6) $ 3.80 $ 2.80 $ 3.00 ================ ============== ============== ------------------------------------------------------------------------------------------------------------------------------------
See notes to consolidated financial statements.
Consolidated Statements of Stockholders' Equity ---------------------------------------------------------------------------------------------------------------------- Additional Treasury Stock Common Stock Paid-in Retained (at cost) Shares Amount Capital Earnings Shares Amount ---------------------------------------------------------------------------------------------------------------------- Balances, December 31, 1997 89,987,108 $35,994,843 $62,041,288 $1,795,276,453 1,990,525 $16,886,718 ---------------------------------------------------------------------------------------------------------------------- Net earnings in 1998 263,708,596 Employee stock options 64,677 25,871 2,943,785 Employee stock compensation and service awards 2,267,863 (81,346) (1,324,800) Treasury Stock acquired 789,700 32,016,119 Cash dividends ($.48 per share) (42,128,881) ---------------------------------------------------------------------------------------------------------------------- Balances, December 31, 1998 90,051,785 36,020,714 67,252,936 2,016,856,168 2,698,879 47,578,037 ---------------------------------------------------------------------------------------------------------------------- Net earnings in 1999 244,589,094 Employee stock options 50,733 20,293 2,347,053 Employee stock compensation and service awards 1,785,220 (53,396) (1,070,449) Treasury stock acquired (478,642) 323,298 14,283,103 Cash dividends ($.52 per share) (45,354,239) ---------------------------------------------------------------------------------------------------------------------- Balances, December 31, 1999 90,102,518 36,041,007 70,906,567 2,216,091,023 2,968,781 60,790,691 ---------------------------------------------------------------------------------------------------------------------- Net earnings in 2000 310,907,988 Employee stock options 9,620 3,848 409,508 Employee stock compensation and service awards 401,879 (108,647) (3,921,444) Treasury stock acquired (223,284) 9,669,056 398,504,348 Cash dividends ($.60 per share) (48,213,301) ---------------------------------------------------------------------------------------------------------------------- Balances, December 31, 2000 90,112,138 $36,044,855 $71,494,670 $2,478,785,710 12,529,190 $455,373,595 ----------------------------------------------------------------------------------------------------------------------
Consolidated Balance Sheets 20
December 31, 2000 1999 --------------------------------------------------------------------------------------- Assets Current assets: Cash and short-term investments $ 490,576,279 $ 572,185,451 Accounts receivable (Note 2) 350,184,329 393,763,651 Inventories (Note 3) 461,151,913 464,983,651 Other current assets (Note 10) 79,534,386 107,575,758 -------------- -------------- Total current assets 1,381,446,907 1,538,508,511 Property, plant and equipment (Note 4) 2,340,340,812 2,191,339,477 -------------- -------------- $3,721,787,719 $3,729,847,988 ============== ============== Liabilities and stockholders' equity Current liabilities: Accounts payable $ 203,334,079 $ 255,229,202 Federal income taxes - 2,455,851 Salaries, wages and related accruals 134,953,274 116,749,067 Accrued expenses and other current liabilities 219,781,099 156,596,778 -------------- -------------- Total current liabilities 558,068,452 531,030,898 -------------- -------------- Long-term debt due after one year (Note 5) 460,450,000 390,450,000 -------------- -------------- Deferred credits and other liabilities (Note 10) 260,054,154 265,247,949 -------------- -------------- Minority interests 312,263,473 280,871,235 -------------- -------------- Stockholders' equity (Note 6): Common stock 36,044,855 36,041,007 Additional paid-in capital 71,494,670 70,906,567 Retained earnings 2,478,785,710 2,216,091,023 -------------- -------------- 2,586,325,235 2,323,038,597 Treasury stock (455,373,595) (60,790,691) -------------- -------------- 2,130,951,640 2,262,247,906 -------------- -------------- $3,721,787,719 $3,729,847,988 ============== ==============
See notes to consolidated financial statements. Consolidated Statements of Cash Flows 21
Year Ended December 31, 2000 1999 1998 ----------------------------------------------------------------------------------------------------------------- Operating activities: Net earnings $ 310,907,988 $ 244,589,094 $ 263,708,596 Adjustments: Depreciation 259,365,173 256,637,460 253,118,608 Deferred federal income taxes 19,400,000 10,600,000 (1,000,000) Minority interests 151,275,438 85,651,646 102,469,931 Changes in: Accounts receivable 43,579,322 (94,518,857) 87,107,818 Inventories 3,831,738 (29,098,813) (38,836,459) Accounts payable (51,895,123) 56,899,431 (61,938,344) Federal income taxes (4,359,890) (23,634,420) 16,101,428 Other 86,650,021 97,708,808 21,167,751 ---------- ---------- ---------- Cash provided by operating activities 820,754,667 604,834,349 641,899,329 ----------------------------------------------------------------------------------------------------------------- Investing activities: Capital expenditures (415,404,602) (374,717,759) (502,910,263) Disposition of plant and equipment 5,128,217 442,250 2,924,833 ---------- ---------- ---------- Cash used in investing activities (410,276,385) (374,275,509) (499,985,430) ----------------------------------------------------------------------------------------------------------------- Financing activities: Increase in long-term debt 70,000,000 175,000,000 47,250,000 Issuance of common stock 4,736,679 5,223,015 6,562,319 Distributions to minority interests (119,883,200) (87,176,880) (96,265,895) Cash dividends (48,213,301) (45,354,239) (42,128,881) Acquisition of treasury stock (398,727,632) (14,761,745) (32,016,119) ---------- ---------- ---------- Cash provided by (used in) financing activities (492,087,454) 32,930,151 (116,598,576) ----------------------------------------------------------------------------------------------------------------- Increase (decrease) in cash and short-term investments (81,609,172) 263,488,991 25,315,323 Cash and short-term investments - beginning of year 572,185,451 308,696,460 283,381,137 ---------- ---------- ---------- Cash and short-term investments - end of year $ 490,576,279 $ 572,185,451 $ 308,696,460 ============= ============= ============= -----------------------------------------------------------------------------------------------------------------
See notes to consolidated financial statements. Notes to Consolidated Financial Statements 22 Years Ended December 31, 2000, 1999, and 1998 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Nucor is a manufacturer of steel products, and reports in one segment. The consolidated financial statements include Nucor and all of its subsidiaries. The minority interests in operations of less than 100%-owned subsidiaries are included in cost of products sold. All significant intercompany transactions are eliminated. Investments in joint ventures with ownership of less than 50% are accounted for under the equity method. Short-term investments are recorded at cost plus accrued interest, which approximates market, and will be converted into cash within three months from date of purchase. Inventories are stated at the lower of cost or market. Cost is determined principally using the last-in, first-out (LIFO) method of accounting. Property, plant and equipment are stated at cost. Depreciation is provided on a straight-line basis over the estimated useful lives of the assets. Liabilities are recorded for the estimated costs of complying with various regulations and involvement in judicial and administrative proceedings, including matters related to contracts, torts, environment, taxes and insurance. Actual costs could differ from these estimates. 2. ACCOUNTS RECEIVABLE: Accounts receivable are stated net of the allowance for doubtful accounts of $27,573,485 in 2000 ($21,093,233 in 1999 and $16,275,198 in 1998). 3. INVENTORIES: Inventories consist of approximately 45% raw materials and supplies, and 55% finished and semi-finished products in 2000 (50% and 50% in 1999). Inventories valued using the last-in, first-out (LIFO) method of accounting represent approximately 85% of total inventories in 2000 and 1999. If the first-in, first-out (FIFO) method of accounting had been used, inventories would have been $19,358,398 higher in 2000 ($28,590,595 higher in 1999). Use of the lower of cost or market reduced inventories by $2,498,447 in 2000 ($319,625 in 1999). 4. PROPERTY, PLANT AND EQUIPMENT: The average annual depreciation rate was 7.2% in 2000 (7.7% in 1999 and 8.3% in 1998). December 31, 2000 1999 ------------------------------------------------------------------- Land and improvements $ 94,537,956 $ 69,626,548 Buildings and improvements 357,440,801 313,624,168 Machinery and equipment 3,482,931,960 3,003,385,098 Construction in process and equipment deposits 89,925,106 293,286,692 -------------- -------------- 4,024,835,823 3,679,922,506 Less accumulated depreciation 1,684,495,011 1,488,583,029 ------------------------------------------------------------------- $2,340,340,812 $2,191,339,477 ============== ============== 5. LONG-TERM DEBT AND FINANCING ARRANGEMENTS: SEVEN BANKS ARE COMMITTED TO LEND NUCOR A TOTAL OF $248,000,000 (NOTHING HAS BEEN BORROWED), WITH BORROWINGS, IF ANY, REPAYABLE IN 2003 ($10,000,000), 2004 ($20,000,000), 2005 ($20,000,000) AND 2006 ($198,000,000). THESE COMMITMENTS CANNOT BE WITHDRAWN UNLESS THERE IS NON-COMPLIANCE UNDER THE LOAN AGREEMENTS. Annual aggregate long-term debt maturities are: none in 2002; $300,000 in 2003; $300,000 in 2004; and $300,000 in 2005. The fair value of Nucor's long-term debt approximates the carrying value. December 31, 2000 1999 ------------------------------------------------------------------- Industrial revenue bonds, 4.5% to 8%, due from 2003 to 2033 $285,450,000 $215,450,000 Notes payable, 6%, due 2009 175,000,000 175,000,000 ------------------------------------------------------------------- $460,450,000 $390,450,000 ============ ============= Notes to Consolidated Financial Statements 23 6. CAPITAL STOCK: The par value of Nucor's common stock is $.40 Per share and there are 200,000,000 shares authorized. Nucor's Key Employees' Incentive Stock Option Plans provide that common stock options may be granted to key employees and officers at 100% of the market value on the date of the grant. During 2000, options were granted for 482,431 shares (209,459 in 1999 and 203,812 in 1998); and options for 167,498 shares (111,407 in 1999 and 99,182 in 1998) expired or were canceled. At December 31, 2000, options for 990,630 shares (685,317 in 1999 and 637,998 in 1998) were outstanding at an aggregate exercise price of $44,185,270 ($33,137,733 in 1999 and $32,345,526 in 1998); options for 710,386 shares (583,619 in 1999 and 525,203 in 1998) were exercisable; and 2,180,737 shares (2,607,413 in 1999 and 2,805,106 in 1998) were reserved for future grants. 250,000 shares of preferred stock, par value of $4.00 per share, are authorized, with preferences, rights and restrictions as may be fixed by Nucor's Board of Directors. No shares of preferred stock have been issued since their authorization in 1964. Nucor's basic earnings per share of common stock are based on 81,762,429 average shares outstanding in 2000 (87,247,160 in 1999 and 87,861,501 in 1998). If all employee stock options were exercised, diluted earnings per share would not be materially different than basic earnings per share. The pro-forma income effect of fair value accounting for stock opions is immaterial for all periods presented. 7. CONTINGENCIES: Nucor is subject to environmental laws and regulations established by federal, state and local authorities; and makes provision for the estimated costs related to compliance. Of the total $130,147,000 of accrued environmental costs at December 31, 2000 ($99,215,000 in 1999 and $74,390,000 in 1998), $63,097,000 was classified in accrued expenses and other current liabilities ($21,681,000 in 1999 and $19,573,000 in 1998) and $67,050,000 was classified in deferred credits and other liabilities ($77,534,000 in 1999 and $54,817,000 in 1998). In December 2000, Nucor entered into a consent decree with the United States Environmental Protection Agency and certain states in order to resolve alleged environmental violations. Under terms of this decree, Nucor will conduct testing at some of its facilities, perform corrective action where necessary, and pilot certain pollution control technologies. 8. EMPLOYEE BENEFIT PLANS: Nucor has a Profit Sharing and Retirement Savings Plan for qualified employees. Nucor's expense for these benefits was $49,280,977 in 2000 ($39,195,491 in 1999 and $47,379,373 in 1998). Nucor also has a medical plan covering certain eligible early retirees. The unfounded obligation, included in deferred credits and other liabilities in the balance sheet, totaled $32,347,105 in 2000 ($29,395,000 in 1999). Expense associated with this plan was $3,038,714 in 2000 ($4,117,480 in 1999). 9. INTEREST EXPENSE (INCOME): Interest expense is stated net of interest income of $23,264,824 in 2000 ($25,610,881 in 1999 and $13,832,452 in 1998). Interest paid was $21,625,267 in 2000 ($14,692,106 in 1999 and $9,362,617 in 1998). 10. FEDERAL INCOME TAXES: 2000 1999 1998 -------------------------------------------------------------------------- Currently payable $148,000,000 $124,000,000 $152,600,000 Deferred 19,400,000 10,600,000 (1,000,000) -------------------------------------------------------------------------- $167,400,000 $134,600,000 $151,600,000 ============ ============ ============ Current deferred federal income tax assets of approximately $75,000,000 in 2000 ($90,400,000 in 1999) relate primarily to differences between financial and tax reporting of inventories and accrued expenses. Non-current deferred federal income tax liabilities of approximately $105,000,000 in 2000 ($101,000,000 in 1999) relate primarily to differences between financial and tax reporting of depreciation. Federal income taxes paid were $152,400,000 in 2000 ($147,400,000 in 1999 and $158,700,000 in 1998). Notes to Consolidated Financial Statements 24 11. QUARTERLY INFORMATION (UNAUDITED):
First Second Third Fourth 2000 December 31, Quarter Quarter Quarter Quarter --------------------------------------------------------------------------------------------------- Net sales $1,199,634,778 $1,213,945,302 $1,163,088,140 $1,009,477,761 Gross margin 167,884,777 176,874,378 154,353,874 161,554,412 Net earnings 81,489,845 81,803,693 67,794,472 79,819,978 Net earnings per share .94 .98 .85 1.03 --------------------------------------------------------------------------------------------------- 1999 Net sales $ 893,822,966 $ 997,166,323 $1,026,687,893 $1,091,668,870 Gross margin 74,916,287 112,796,954 150,359,993 190,794,161 Net earnings 28,173,392 50,647,213 68,161,966 97,606,523 Net earnings per share .32 .58 .78 1.12 ---------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------- Independent Accountants Report -------------------------------------------------------------------------------- PricewaterhouseCoopers LLP February 1, 2001 Stockholders and Board of Directors Nucor Corporation In our opinion, the accompanying consolidated balance sheets and the related consolidated statements of earnings, stockholders' equity and cash flows present fairly, in all material respects, the financial position of Nucor Corporation and subsidiaries as of December 31, 2000 and 1999, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2000, in conformity with accounting principles generally accepted in the United States. These financial statements are the responsibility of Nucor's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with auditing standards generally accepted in the United States which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for the opinion expressed above. /s/ PricewaterhouseCoopers LLP Charlotte, North Carolina BOARD OF DIRECTORS AND EXECUTIVE MANAGEMENT 25 Board of Directors Jeffrey M. Kemp John J. Ferriola General Manager of Business Vice President, General Manager H. David Aycock Development and Strategic Management Sheet Mill Group Former Chairman, President and Crawfordsville, Indiana Chief Executive Officer, Norman L. Maero Nucor Corporation General Manager of Construction Ladd R. Hall Vice President, General Manager Peter C. Browning K. Rex Query Sheet Mill Group, Beam Mill Non-Executive Chairman, General Manager and Mt. Pleasant, South Carolina Nucor Corporation Corporate Controller Donald N. Holloway Daniel R. DiMicco Steven J. Rowlan Vice President, General Manager President and General Manager of Vulcraft Group, Cold Finish Group Chief Executive Officer, Environmental Affairs Norfolk, Nebraska Nucor Corporation A. Rae Eagle James R. Landrum Harvey B. Gantt Corporate Secretary Vice President, General Manager Partner, Gantt Huberman Architects Vulcraft Group Operations Grapeland, Texas Victoria F. Haynes President, James R. Beard Harry R. Lowe Research Triangle Institute Vice President, General Manager Vice President, General Manager Vulcraft Group, Cold Finish Group Building Systems Group James D. Hlavacek Brigham City, Utah Waterloo, Indiana Managing Director, Market Driven Management A. Jay Bowcutt Raymond Napolitan, Jr. Vice President, General Manager General Manager Samuel Siegel Bar Mill Group Building Systems Group Vice Chairman, Plymouth, Utah Terrell, Texas Former Chief Financial Officer, Nucor Corporation James E. Campbell Robert M. Proia Vice President, General Manager General Manager Executive Management Vulcraft Group Vulcraft of New York, Inc. Executive Offices Fort Payne, Alabama Chemung, New York Daniel R. DiMicco Jeff B. Carmean James W. Ronner Director, President and General Manager Vice President, General Manager Chief Executive Officer Building Systems Group Vulcraft Group Swansea, South Carolina St. Joe, Indiana Terry S. Lisenby Chief Financial Officer, Treasurer David L. Chase R. Joseph Stratman and Executive Vice President Vice President, General Manager Vice President, General Manager Sheet Mill Group Nucor-Yamato Steel Company Hamilton Lott, Jr. Hickman, Arkansas Blytheville, Arkansas Executive Vice President James R. Darsey Lynn E. Strock D. Michael Parrish Vice President, General Manager Vice President, General Manager Executive Vice President Bar Mill Group Vulcraft Group Jewett, Texas Florence, South Carolina Joseph A. Rutkowski Executive Vice President Giffin F. Daughtridge G. Wayne Studebaker General Manager General Manager James M. Coblin Plate Mill Research and Development Vice President, Human Resources Winton, North Carolina Norfolk, Nebraska Elizabeth W. Bowers Jerry V. DeMars General Manager of Taxes Vice President, General Manager Fastener Division Robert W. Johns St. Joe, Indiana Director of Marketing, Sheet Mill Group
Corporate and Stock Data 26 Executive Offices Stock Price and Dividends Paid: 2100 Rexford Road Charlotte, North Carolina 28211 First Second Third Fourth Phone 704/366-7000 Quarter Quarter Quarter Quarter Fax 704/362-4208 -------------------------------------------------- 2000 Stock Transfers Stock Price: Dividend Disbursing High $56.44 $51.25 $39.75 $41.19 Dividend Reinvestment Low 45.06 33.00 29.94 29.50 Dividends Paid .13 .15 .15 .15 American Stock Transfer -------------------------------------------------- & Trust Company 1999 40 Wall Street Stock Price: New York, New York 10005 High $50.25 $61.81 $53.00 $57.44 Phone 800/937-5449 Low 41.63 44.56 44.25 40.00 Fax 718/236-2641 Dividends Paid .12 .13 .13 .13 -------------------------------------------------- Annual Meeting Place - 10-K and 11-Year Data The Park Hotel Copies of (1) Form 10-K for 2000 filed with 2200 Rexford Road the Securities and Exchange Commission, and Morrison A & B (2) various financial and statistical data Charlotte, North Carolina for the years 1990 to 2000, are available on request. Time/Date - 10:00 A.M., Wednesday Internet Data May 9, 2001 Various data is available on www.nucor.com. Stock Listing New York Stock Exchange Trading Symbol - NUE