EX-99.1 2 v090446_ex99-1.htm
   
  
News Release
 
NUCOR REPORTS RESULTS FOR FIRST NINE MONTHS AND THIRD QUARTER OF 2007
 
CHARLOTTE, NORTH CAROLINA, October 18, 2007 - Nucor Corporation (NYSE: NUE) announced today consolidated net earnings for the first nine months of 2007 of $1.11 billion ($3.68 per diluted share), a decrease of 18% from net earnings of $1.35 billion ($4.34 per diluted share) in last year’s first nine months.
 
Consolidated net earnings of $381.2 million ($1.29 per diluted share) in this year’s third quarter increased 11% from the $344.9 million ($1.14 per diluted share) earned in the second quarter of 2007 and decreased 27% compared with $521.6 million ($1.70 per diluted share) earned in the third quarter of 2006.

In the first nine months of 2007, Nucor’s consolidated net sales increased 8% to $12.20 billion, compared with $11.28 billion in last year’s first nine months. Average sales price per ton increased 8% while total tons shipped to outside customers remained flat compared to the first nine months of 2006.
 
In the third quarter of 2007, Nucor’s consolidated net sales increased 8% to $4.26 billion, compared with $3.93 billion in the third quarter of 2006 and increased 2% compared with $4.17 billion in the second quarter of 2007. Average sales price per ton increased 5% from the third quarter of 2006 and decreased 1% from the second quarter of 2007. Total tons shipped to outside customers were 5,771,000 tons in the third quarter of 2007, an increase of 3% over the third quarter of 2006 and an increase of 3% over the second quarter of 2007.
 
The average scrap and scrap substitute cost per ton used increased 11% from $247 in the first nine months of 2006 to $275 in the first nine months of 2007, increased 8% from $257 in the third quarter of 2006 to $277 in the third quarter of 2007, and decreased 5% from $291 in the second quarter of 2007.
 
Nucor incurred a charge to value inventories using the last-in, first-out (LIFO) method of accounting of $102.0 million in the first nine months of 2007, compared with a charge of $45.0 million in the first nine months of 2006. In the third quarter of 2007, the LIFO charge was $11.0 million, compared with a charge of $20.5 million in the third quarter of 2006 and a charge of $66.5 million in the second quarter of 2007.
 
In the steel mills segment, steel production decreased 5% to 16,503,000 tons in the first nine months of 2007, compared with 17,318,000 tons produced in the first nine months of 2006.
 
Total steel shipments decreased 4% to 16,663,000 tons in the first nine months of 2007, compared with 17,286,000 tons in last year’s first nine months. Steel shipments to outside customers decreased 5% to 15,157,000 tons in the first nine months of 2007, compared with 15,936,000 tons in last year’s first nine months.
 
In the steel products segment, steel joist production during the first nine months of 2007 decreased to 409,000 tons, compared with 433,000 tons in the first nine months of 2006. Steel deck sales increased to 355,000 tons in the first nine months of 2007, compared with 284,000 tons in last year's first nine months. Cold finished steel sales increased to 322,000 tons compared to 261,000 tons in the first nine months of 2006. Sales of fabricated concrete reinforcing steel were 385,000 tons from the acquisition date of Harris Steel Group Inc. near the end of the first quarter of 2007 through the end of the third quarter (approximately six months).
 
Page 1 of 6
Nucor Executive Offices: 1915 Rexford Road, Charlotte, North Carolina 28211
Phone 704-366-7000 Fax 704-362-4208 www.nucor.com

   
  
News Release
 
NUCOR REPORTS RESULTS FOR FIRST NINE MONTHS AND THIRD QUARTER OF 2007 (Continued)
 
In September, Nucor’s board of directors declared a supplemental dividend of $0.50 per share in addition to the $0.11 per share base dividend. The total dividend of $0.61 per share is payable on November 9, 2007 to stockholders of record on September 28, 2007. Nucor began paying a supplemental dividend in the second quarter of 2005, allowing stockholders to participate in our successful pay-for-performance business model.
 
During the third quarter, Nucor repurchased approximately 11.6 million shares of its common stock at a cost of approximately $599.8 million, completing the previous repurchase authorization. During the first nine months, Nucor repurchased approximately 14.1 million shares at a cost of about $754.0 million. In September, the board of directors approved the repurchase of up to an additional 30 million shares of common stock, all of which remain available for repurchase.
 
In the third quarter, Nucor completed the acquisition of three downstream companies: Magnatrax Corporation, LMP Steel & Wire and Consolidated Rebar, Inc. (acquired through Nucor’s wholly owned subsidiary, Harris Steel Inc.). These acquisitions enhance Nucor’s product diversification and are part of the execution of Nucor’s strategy for profitable downstream growth.
 
In addition, Nucor announced two acquisitions in September that are expected to close in the fourth quarter. Nucor has entered into an agreement to acquire substantially all the assets of Nelson Steel, Inc., a producer of wire mesh and related products, with capacity of approximately 80,000 tons. Nucor’s wholly owned subsidiary, Harris Steel Inc., has entered into an agreement with Barker Steel Company, Inc. to form a new entity that combines the two companies’ rebar fabrication operations in the northeastern U.S. market. Harris will contribute two facilities located in Pennsylvania and Massachusetts, as well as cash, for a 90% equity interest in the new venture. In exchange for a 10% interest in the venture, Barker will contribute its eight northeastern U.S. facilities located in New York, New Hampshire, Connecticut, New Jersey, Massachusetts (3) and Rhode Island. The Barker facilities have total rebar fabrication capacity of approximately 218,000 tons. With the completion of the Barker joint venture, Harris Steel’s annual rebar fabrication capacity will exceed 1 million tons.
 
We expect that the fourth quarter of 2007 will be another good quarter with earnings in the range of $1.10 to $1.20 per diluted share. We expect continued strength in bar, beam, plate and many of our downstream businesses. Market conditions for sheet are slowly improving with more balance between customer inventories and demand. We are also finally seeing a significant drop in imports, which has helped bring these inventories back into balance. Fourth quarter shipments will be impacted by the usual seasonal and holiday factors, including scheduled shut-downs at many of our facilities for regular maintenance. The biggest risks to our forecast for the fourth quarter and 2008 remain any further weakening in the economy and any significant reversal of the recent decreases in import levels.
 
Nucor and affiliates are manufacturers of steel products, with operating facilities primarily in the U.S. and Canada. Products produced include: carbon and alloy steel -- in bars, beams, sheet and plate; steel joists and joist girders; steel deck; fabricated concrete reinforcing steel; cold finished steel; steel fasteners; metal building systems; light gauge steel framing; steel grating and expanded metal; and wire and wire mesh. Nucor is North America's largest recycler.
 
Page 2 of 6
Nucor Executive Offices: 1915 Rexford Road, Charlotte, North Carolina 28211
Phone 704-366-7000 Fax 704-362-4208 www.nucor.com

   
  
News Release
 
NUCOR REPORTS RESULTS FOR FIRST NINE MONTHS AND THIRD QUARTER OF 2007 (Continued)
 
Certain statements contained in this news release are “forward-looking statements” that involve risks and uncertainties. Factors that might cause the Company’s actual results to differ materially from those anticipated in forward-looking statements include, but are not limited to: (1) the sensitivity of the results of our operations to prevailing steel prices and the changes in the supply and cost of raw materials, including scrap steel; (2) market demand for steel products; (3) energy costs and availability; (4) competitive pressure on sales and pricing, including pressure from imports and substitute materials; and (5) capital investments and their impact on our performance. These and other factors are outlined in Nucor’s regulatory filings with the Securities and Exchange Commission, including those in Nucor’s December 31, 2006 Annual Report on Form 10-K. The forward-looking statements contained in this news release speak only as of this date, and Nucor does not assume any obligation to update them.
 
You are invited to listen to the live broadcast of Nucor’s conference call in which management will discuss Nucor’s third quarter results on October 18, 2007 at 2:00 p.m. eastern time. The conference call will be available over the Internet at www.nucor.com, under Investor Relations.
 
 
Page 3 of 6
Nucor Executive Offices: 1915 Rexford Road, Charlotte, North Carolina 28211
Phone 704-366-7000 Fax 704-362-4208 www.nucor.com

   
  
News Release
 
NUCOR REPORTS RESULTS FOR FIRST NINE MONTHS AND THIRD QUARTER OF 2007 (Continued)
 
Unaudited figures are as follows:
 
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited)
(In thousands, except per share data)
 
   
Nine Months (39 Weeks) Ended
 
Three Months (13 Weeks) Ended
 
   
Sept. 29, 2007
  
Sept. 30, 2006
As Adjusted
  
Sept. 29, 2007
  
Sept. 30, 2006
As Adjusted
  
                   
NET SALES
  
$
12,196,216
  
$
11,282,680
  
$
4,259,221
  
$
3,931,233
  
                           
COSTS, EXPENSES AND OTHER:
                          
Cost of products sold
    
9,844,763
   
8,628,748
   
3,449,260
   
2,920,782
 
Marketing, administrative and
                         
other expenses
    
430,605
   
450,266
   
145,470
   
160,464
 
Interest (income) expense, net
    
(607
)
  
(25,753
)
  
3,576
   
(10,433
)
Minority interests
    
214,653
   
147,568
   
76,494
   
58,660
 
     
10,489,414
   
9,200,829
   
3,674,800
   
3,129,473
 
                           
EARNINGS BEFORE
                          
INCOME TAXES
    
1,706,802
   
2,081,851
   
584,421
   
801,760
 
Provision for income taxes
    
599,701
   
730,173
   
203,199
   
280,124
 
NET EARNINGS
  
$
1,107,101
  
$
1,351,678
  
$
381,222
  
$
521,636
  
                           
NET EARNINGS PER SHARE:
                          
Basic
  
$
3.71
  
$
4.38
  
$
1.30
  
$
1.71
  
Diluted
  
$
3.68
  
$
4.34
  
$
1.29
  
$
1.70
  
                           
AVERAGE SHARES OUTSTANDING:
                          
Basic
    
298,468
   
308,569
   
293,096
   
304,835
 
Diluted
    
300,600
   
311,420
   
295,019
   
307,553
 
 
(On January 1, 2007, Nucor adopted FASB Staff Position AUG AIR-1, “Accounting for Planned Major Maintenance Activities,” which eliminates the method that Nucor had previously used of accruing in advance for planned major maintenance activities. In accordance with this position statement, Nucor now uses the deferral method of accounting for such maintenance activities. The prior periods have been adjusted to reflect the effects of applying this new accounting principle.)
 
Page 4 of 6
Nucor Executive Offices: 1915 Rexford Road, Charlotte, North Carolina 28211
Phone 704-366-7000 Fax 704-362-4208 www.nucor.com

   
  
News Release
 
NUCOR REPORTS RESULTS FOR FIRST NINE MONTHS AND THIRD QUARTER OF 2007 (Continued)
 
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
(In thousands)

   
Sept. 29, 2007
  
Dec. 31, 2006
As Adjusted
  
Assets
             
CURRENT ASSETS:
             
Cash and cash equivalents
 
$
272,256
  
$
785,651
  
Short-term investments
   
-
   
1,410,633
 
Accounts receivable, net
   
1,629,682
   
1,067,322
 
Inventories
   
1,604,580
   
1,141,194
 
Other current assets
   
256,905
   
278,265
 
               
Total current assets
   
3,763,423
   
4,683,065
 
               
PROPERTY, PLANT AND EQUIPMENT, NET
   
3,101,981
   
2,856,415
 
               
GOODWILL
   
812,220
   
143,265
 
               
OTHER INTANGIBLE ASSETS, NET
   
471,944
   
5,015
 
               
OTHER ASSETS
   
150,675
   
205,258
 
               
TOTAL ASSETS
 
$
8,300,243
  
$
7,893,018
  
               
Liabilities and stockholders' equity
             
CURRENT LIABILITIES:
             
Short-term debt
 
$
22,265
  
$
-
  
Accounts payable
   
784,329
   
516,640
 
Salaries, wages and related accruals
   
419,096
   
455,051
 
Accrued expenses and other current liabilities
   
442,218
   
450,226
 
Total current liabilities
   
1,667,908
   
1,421,917
 
LONG-TERM DEBT DUE AFTER ONE YEAR
   
922,300
   
922,300
 
DEFERRED CREDITS AND OTHER LIABILITIES
   
591,173
   
448,084
 
MINORITY INTERESTS
   
230,278
   
243,366
 
               
STOCKHOLDERS' EQUITY:
             
Common stock
   
149,277
   
149,006
 
Additional paid-in capital
   
244,249
   
195,543
 
Retained earnings
   
6,433,374
   
5,840,067
 
Accumulated other comprehensive income
   
139,599
   
4,470
 
     
6,966,499
   
6,189,086
 
Treasury stock
   
(2,077,915
)
  
(1,331,735
)
Total stockholders' equity
   
4,888,584
   
4,857,351
 
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
 
$
8,300,243
  
$
7,893,018
  
 
Page 5 of 6
Nucor Executive Offices: 1915 Rexford Road, Charlotte, North Carolina 28211
Phone 704-366-7000 Fax 704-362-4208 www.nucor.com

   
  
News Release
 
NUCOR REPORTS RESULTS FOR FIRST NINE MONTHS AND THIRD QUARTER OF 2007 (Continued)
 
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(In thousands)

   
 Nine Months (39 Weeks) Ended
 
   
 Sept. 29, 2007
  
Sept. 30, 2006
As Adjusted
  
            
Operating activities:
              
Net earnings
 
$
1,107,101
  
$
1,351,678
  
Adjustments:
              
Depreciation
    
298,280
   
273,678
 
Amortization
    
15,437
   
1,333
 
Stock-based compensation
    
33,875
   
30,200
 
Deferred income taxes
    
(91,191
)
  
(43,038
)
Minority interests
    
214,651
   
147,554
 
Settlement of natural gas hedges
    
(13,207
)
  
(3,668
)
Changes in (exclusive of acquisitions):
              
Accounts receivable
    
(239,401
)
  
(214,474
)
Inventories
    
(128,436
)
  
(181,482
)
Accounts payable
    
167,549
   
157,668
 
Federal income taxes
    
71,598
   
106,955
 
Salaries, wages and related accruals
    
(54,430
)
  
57,869
 
Other
    
8,857
   
6,149
 
Cash provided by operating activities
    
1,390,683
   
1,690,422
 
               
Investing activities:
              
Capital expenditures
    
(330,586
)
  
(240,175
)
Sale of interest in affiliate
    
29,500
   
-
 
Investment in affiliates
    
(27,913
)
  
(34,241
)
Disposition of plant and equipment
    
804
   
1,978
 
Acquisitions (net of cash acquired)
    
(1,410,677
)
  
(43,879
)
Purchases of short-term investments
    
(276,945
)
  
(803,253
)
Proceeds from sales of short-term investments
    
1,687,578
   
271,675
 
Proceeds from currency derivative contracts
    
517,241
   
-
 
Settlement of currency derivative contracts
    
(511,394
)
  
-
 
               
Cash used in investing activities
    
(322,392
)
  
(847,895
)
               
Financing activities:
              
Net change in short-term debt
    
(66,461
)
  
-
 
Repayment of long-term debt
    
-
   
(1,250
)
Issuance of common stock
    
10,430
   
46,373
 
Excess tax benefits from stock-based compensation
    
9,500
   
12,200
 
Distributions to minority interests
    
(231,520
)
  
(151,411
)
Cash dividends
    
(549,606
)
  
(395,793
)
Acquisition of treasury stock
    
(754,029
)
  
(500,199
)
               
Cash used in financing activities
   
(1,581,686
)
  
(990,080
)
               
Decrease in cash and cash equivalents
    
(513,395
)
  
(147,553
)
               
Cash and cash equivalents - beginning of year
    
785,651
   
980,150
 
               
Cash and cash equivalents - end of nine months
  
$
272,256
  
$
832,597
  
 
Page 6 of 6
Nucor Executive Offices: 1915 Rexford Road, Charlotte, North Carolina 28211
Phone 704-366-7000 Fax 704-362-4208 www.nucor.com