Profile: Nucor Corp (NUE.N)
14 Mar 2014
Nucor Corporation and its affiliates (Nucor), incorporated on March 28, 1958, manufactures steel and steel products. The Company also produces direct reduced iron (DRI) for use in the Company’s steel mills. The Company operates in three segments: steel mills, steel products and raw materials. The Company through The David J. Joseph Company and its affiliates (DJJ), processes ferrous and nonferrous metals and brokers ferrous and nonferrous metals, pig iron, hot briquetted iron (HBI) and DRI. The Company’s operations include several international trading companies that buy and sell steel and steel products manufactured by the Company and others. Nucor is North America’s recycler, using scrap steel as the primary raw material in producing steel and steel products.
In 2012, it recycled approximately 19.2 million tons of scrap steel. In May 2012, ArcelorMittal announced the sale of its steel foundation distribution business in NAFTA, namely Skyline Steel and Astralloy (Skyline Steel) to Nucor. The transaction includes 100% of ArcelorMittal’s interest in Skyline Steel’s operations in the NAFTA countries and the Caribbean. In June 2012, the Company acquired Skyline Steel LLC and its subsidiaries. In August 2012, the Company completed the sale of the assets of their Nucor Wire Products Pennsylvania facility located in New Salem, Pennsylvania, to an affiliate of Wire Mesh Corporation.
Nucor has employed a multi-pronged growth strategy in recent years that allows for the ability to capitalize on a variety of growth opportunities as they arise. The five prongs of that growth strategy are: optimizing and continually improving its existing operations, executing on its raw materials strategy, growing through developing greenfield projects that capitalize on new technologies and marketplace opportunities, acquiring other companies that will strengthen Nucor’s position as North America’s diversified producer of steel and steel products and growing internationally with an emphasis on leveraging strategic partnerships and new technologies.
Steel Mills Segment
In the steel mills segment, Nucor produces and distributes sheet steel (hot-rolled, cold-rolled and galvanized), plate steel, structural steel (wide-flange beams, beam blanks, H-piling and sheet piling) and bar steel (blooms, billets, concrete reinforcing bar, merchant bar and SBQ). Nucor manufactures steel principally from scrap steel and scrap steel substitutes using electric arc furnaces, continuous casting and automated rolling mills. The steel mills segment also includes Nucor’s equity method investments in Duferdofin Nucor S.r.l. and NuMit. In the steel products segment, Nucor produces steel joists and joist girders, steel deck, fabricated concrete reinforcing steel, cold finished steel, steel fasteners, metal building systems, steel grating and expanded metal, and wire and wire mesh. In the raw materials segment, the Company produces DRI; brokers ferrous and nonferrous metals, pig iron, HBI and DRI; supplies ferro-alloys; and processes ferrous and nonferrous scrap metal. The raw materials segment also includes itsnatural gas working interest drilling programs with Encana and certain equity method investments. The steel mills segment sells its products primarily to steel service centers, fabricators and manufacturers located throughout the United States, Canada, Mexico and, increasingly, elsewhere in the world. Nucor produces hot-rolled and cold-rolled sheet steel in standard grades and to customers’ specifications while maintaining inventories to fulfill anticipated orders.
In 2012, it sold approximately 85% of the production by its steel mills segment to external customers. The balance of the steel mill segment’s production went to its piling distributor and its downstream joist, deck, rebar fabrication, fastener, metal buildings and cold finish operations.
Steel Products Segment
In the steel products segment, it sells steel joists and joist girders, and steel deck to general contractors and fabricators located throughout the United States and Canada. It makes these products to the customers’ specifications and do not maintain inventories of these finished steel products. The majority of these contracts are firm, fixed-price contracts that are in cases competitively bid against other suppliers. Longer-term supply contracts may permit them to adjust its prices to reflect changes in prevailing raw materials costs. It sells fabricated reinforcing products only on a construction contract bid basis. These products are used by contractors in constructing highways, bridges, reservoirs, utilities, hospitals, schools, airports, stadiums and high-rise buildings. It manufactures cold finished steel, steel fasteners, steel grating, wire and wire mesh in standard sizes and maintain inventories of these products to fulfill anticipated orders. It sells cold finished steel and steel fasteners primarily to distributors and manufacturers located throughout the United States and Canada. It markets products from the steel mills and steel products segments mainly through in-house sales forces. The markets for these products are largely tied to capital and durable goods spending and are affected by changes in general economic conditions.
Raw Materials Segment
In the raw materials segment, it processes ferrous and nonferrous scrap metal for use in its steel mills and for sale to various domestic and international external customers. It also brokers ferrous and nonferrous metals and scrap substitutes, supply ferro-alloys, and provide transportation, material handling and other services to users of scrap metals. Its primary external customers for ferrous scrap are electric arc furnace steel mills and foundries that use ferrous scrap as a raw material in their manufacturing process. External customers purchasing nonferrous scrap metal include aluminum can producers, secondary aluminum smelters, steel mills and other processors and consumers of various nonferrous metals. It markets scrap metal products and related services to its external customers through in-house sales forces. In 2012, approximately 11% of the ferrous and nonferrous metals and scrap substitutes tons it processed were sold to external customers. It used the balance in its steel mills.
1915 Rexford Road
CHARLOTTE NC 28211