* Earnings excluding items of $0.45 a share beat Wall Street
* Nucor forecasts lower profit for fourth quarter
* Stock rises slightly
By Steve James
Oct 18 Nucor Inc reported a drop in
third-quarter earnings on Thursday because of lower prices for
its steel and slowing economic growth, and said it expected a
further profit decline in the current period.
But the third-quarter profit still exceeded Wall Street
estimates, and Nucor's stock edged higher in morning trading.
"Their average prices were down," said Bradford Research
analyst Charles Bradford. He noted, though, that the price of
scrap, a key ingredient for Nucor's steel, was also down, "and
that reflects lower costs."
Net earnings were $110.3 million, or 35 cents per share,
compared with $181.5 million, or 57 cents per share, a year
earlier, the Charlotte, North Carolina-based steelmaker said.
Excluding charges for inventory accounting and a loss on
sale of some assets, the profit was 45 cents per share, which
beat the analysts' average estimate of 43 cents, according to
Thomson Reuters I/B/E/S.
Revenue fell 9 percent to $4.8 billion. Nucor said its
average steel price had declined 8 percent, and shipments had
dipped slightly to 5.77 million tons.
"We currently expect to see some further reduction in
earnings exclusive of one-time charges for the fourth quarter,"
the company said in a statement.
Nucor said earnings had suffered because of increasing
imports of cheap foreign steel into the United States, as well
as excess domestic sheet supply.
In addition, it cited volatility in scrap prices and
political and economic uncertainty in global markets that was
affecting steel buyers' confidence.
"Slowing economic growth both domestically and globally is
expected to be a negative factor through the end of the year,"
the company said.
Nucor said its strongest markets continued to be
manufactured goods, including automotive, energy and heavy
equipment, while the construction market remained "very
The third-quarter results include noncash inventory-related
charges of about $28.2 million, or 6 cents per share, for the
acquisition of Skyline Steel LLC and a loss of $17.6 million, or
4 cents per share, on the sale of the assets of Nucor Wire
Products Pennsylvania Inc.
Shares of Nucor were up 0.3 percent at $40.52 on the New
York Stock Exchange.