The paragraph is a transcript from the first quarter 2025 earnings call for Nucor. It begins with an introduction by the operator and Jack Sullivan, Vice President of Investor Relations, who welcomes everyone to the earnings review. Key speakers include Leon Topalian, Chair, President, and CEO, and Steve Laxton, Executive Vice President and CFO. The company posted its earnings release and presentation on its website, which includes forward-looking information and non-GAAP financial measures. Acknowledging retiring executives, Leon highlights Chad Utermark, EVP of New Markets and Innovation, retiring in June after over three decades, praising his contributions to Nucor's success and culture.

The paragraph announces the retirement of Greg Murphy, EVP of Business Services and General Counsel at Nucor, and extends best wishes to him and Chad. It acknowledges Greg's significant contributions since 2015. With his retirement, Ben Pickett is promoted to EVP of Business Services, and Doug Wilner to President of Corporate Legal Affairs and General Counsel. Tom Batterbee will become EVP of Human Resources and Talent on May 11, bringing 35 years of experience. The paragraph then shifts to Nucor's first-quarter results, reporting an EBITDA of $696 million and an adjusted EPS of $0.77. Despite lower results compared to previous quarters, Nucor's solid financial standing has allowed significant reinvestment and capital returns to shareholders.

The company has raised $1 billion through new senior notes with an average coupon of 4.88% to address upcoming debt maturities and is optimizing operations for better resource allocation. They are undertaking capital projects to enhance earnings and meet customer needs, with updates on various initiatives. The Rebar Micro Mill in North Carolina began production in April, with commercial shipments expected in the third quarter. Similarly, the Arizona bar mill's new melt shop will be operational in the third quarter. New coating facilities at the Indiana and South Carolina sheet mills are progressing, with completion dates set for late 2023 and mid-2026, respectively. Greenfield projects in Alabama and Indiana are also underway, with Alabama opening in the third quarter of this year and Indiana in the first quarter of 2026.

The paragraph discusses ongoing construction of a West Virginia sheet mill projected for completion by 2026, with equipment installation currently underway. The company plans to commission the mill by the end of next year, aiming to supply advanced, clean sheet steel. It highlights recent changes in U.S. federal trade policy, specifically the reinstatement and broadening of Section 232 steel tariffs, which had been weakened by exemptions and quotas since their 2018 implementation. The paragraph argues that ending these exemptions is essential to bolster the U.S. steel industry, which is vital for national security. It also mentions ongoing trade cases and preliminary anti-dumping duties on steel products from ten countries as necessary measures to protect American manufacturers from unfair competition. The company supports these actions as means to ensure a level playing field for American steel producers.

For nearly 30 years, Nucor has focused on advocating for strong trade law enforcement. Despite macroeconomic uncertainty, the company sees promising steel demand, with significant backlog increases in both steel mills and products. Nucor experiences stable pricing and healthy order rates, buoyed by a government targeting less regulation and lower taxes. Demand is strong, particularly in reshoring and infrastructure projects, and Nucor is well-positioned to supply these markets. The company remains optimistic about future growth, supported by its diverse product range and favorable U.S. policies. Nucor is prepared to succeed amid economic volatility due to its strong capabilities, team, and financial position.

The paragraph discusses Nucor's focus on execution and accountability during its transformative growth phase. The company recently published its 2024 Corporate Sustainability Report, emphasizing its low greenhouse gas emission intensity and advancements in cleaner energy and materials. The report also highlights workplace safety improvements. After this introduction by Leon, Steve Laxton reports Nucor's first-quarter net earnings of $156 million, or $0.67 per share, including charges related to facility changes. Excluding these charges, earnings were $179 million, or $0.77 per share. While growth investments are expected to create long-term value, they present short-term challenges to earnings.

During the first quarter, Nucor faced $170 million in pre-operating and startup costs, but their steel mill segment saw significant growth, with adjusted pre-tax earnings rising 43% to $241 million thanks to a 14% increase in volume, particularly from the bar mill group which saw shipments rise 21%. The Brandenburg, Kentucky plate mill also contributed to increased shipments, marking sustained progress over five consecutive quarters. Additionally, Nucor's backlog grew significantly, by over 30% during the quarter, highlighting robust customer demand. The steel products segment, offering diverse solutions, generated $307 million in adjusted pre-tax earnings and also experienced a 25% backlog growth. However, this segment's longer-duration backlogs mean there's a time lag between market pricing changes and financial results, leading to expectations of lower realized pricing in the coming months.

The paragraph discusses Nucor's optimistic outlook for its steel products segment through 2025, highlighting that backlog margins are expected to stay above pre-pandemic levels. It attributes part of this positive outlook to acquisitions since 2022 aimed at enhancing construction product capabilities, resulting in four distinct growth platforms. In 2024, these platforms, including overhead doors, racking, and insulated metal panels, generated about $400 million in EBITDA, with expectations to reach $450 million in 2025 and further growth in 2026. The raw materials segment saw a decrease in pre-tax earnings due to lower pricing and higher expenses. Nucor maintains a strong balance sheet and investment-grade credit rating, having increased its credit facility by $500 million and raised $1 billion through senior notes with a low average coupon rate.

The paragraph discusses Nucor's recent $1 billion debt offering, which is divided between 5 and 10-year terms, to retire existing debt maturing soon. The company maintains a strong investment-grade credit rating, the highest among North American steel producers, with notable ratings from S&P, Fitch, and Moody's. The offering will adjust Nucor's debt to capital ratio to just under 25% and cash to over $3 billion. Nucor is committed to providing direct returns to shareholders, having returned $429 million through dividends and share repurchases in the first quarter. The company observes resilient demand in the sheet segment, with expectations of increased shipments in the second quarter and anticipates market stability due to trade measures.

The paragraph discusses Nucor's strong financial performance and growth expectations in the second quarter of 2025, despite some market volatility. It highlights continued demand in advanced manufacturing, infrastructure, and institutional construction, with significant backlogs in both beam and plate shipments. The steel products segment, including the Joist & Deck, and tubular and metal buildings groups, is experiencing strong demand due to increased data center construction, stable warehouse activity, and institutional projects. Additionally, energy-related projects are boosting demand for specific steel applications. Overall, Nucor anticipates higher earnings in the second quarter, driven by operational gains and reduced imports in certain segments.

In the steel industry, operating results are expected to improve across steel mills, steel products, and raw materials segments compared to the first quarter. The steel mills segment, particularly Nucor's sheet and plate business, is anticipated to lead earnings growth due to stable volumes and higher pricing. The steel products segment will likely see higher volumes and improved cost efficiencies, compensating for slightly lower pricing. In raw materials, flat volumes, moderated scrap pricing, and stable DRI pricing are expected, alongside sequential cost improvements in scrap processing. Looking ahead to 2025, demand for domestic steel is projected to grow, with the company confident in capturing a substantial market share. A Q&A session follows, with Lawson Winder from Bank of America Securities being the first to ask about start-up costs mentioned in previous calls.

In the paragraph, Steve Laxton responds to a question about start-up costs for the year, indicating they will be similar to the previous year, with recent quarters showing costs of $160 million, $164 million, and $170 million. The company is currently engaged in capital spending and new project ramp-ups, with five projects coming online this year. Lawson Winder then asks about the utilization of Brandenburg, and Leon Topalian expresses pride in the team’s work there, asking Brad Ford to elaborate. Ford states confidence in reaching EBITDA positive run rates by the summer, highlighting record production, quality, and shipments, with March being a record shipment month.

The paragraph discusses the growth and development at Nucor’s Brandenburg facility, highlighting significant achievements such as obtaining ABS certification for shipbuilding supplies and shipping the first wide X70 trials for the API line pipe market. These advancements have allowed Nucor to offer new products domestically, reducing reliance on imports. The team is proud of their progress and the customer excitement surrounding their offerings. Leon Topalian notes that Brandenburg covers a vast majority of U.S. plate consumption and aims to balance high-margin, high-value products with more commoditized ones as they move forward.

The paragraph discusses the strategic plan involving three plants—Brandenburg, the Hertford County plant, and Tuscaloosa—to enhance their product offerings, focusing on higher value-added products and grades. It highlights the importance of qualifications like ABS, which take months to achieve but align well with recent legislative changes, such as the President's executive order on ships and the anticipated SHIPS for America Act. The strategy positions them uniquely to offer products rarely available in North America. In response to a question, Steve Laxton does not provide detailed guidance on the second quarter results but acknowledges the questioner's calculations and mentions that they will offer more detailed guidance mid-quarter.

In the paragraph, Timna Tanners asks about the impact of tariffs on Nucor, particularly related to equipment for new mills and raw material supply. Leon Topalian responds by noting that while tariffs are a consideration, much of the equipment for projects like in West Virginia has already been dealt with, reducing exposure. He emphasizes that Nucor's diverse raw material supply strategy mitigates tariff impacts. Furthermore, he argues that macroeconomic trends and pro-American policies have a more significant impact on the steel industry than tariff-related issues. Nucor is closely monitoring the situation and aims to provide more data as it becomes available.

The paragraph discusses how a company is well-positioned in terms of raw materials due to its unique assets and strategies. They highlight their recycling assets, mills, and access to global and seaborne markets. They also emphasize their intelligence capabilities through the David J. Joseph Company, which operates a large scrap brokerage, allowing them to effectively manage ferrous, non-ferrous, and ferro alloys globally. Additionally, they have strong global relationships that help mitigate risks. The company focuses on preparation over prediction, using their established measures to adapt to changes and create value. Lastly, a question is raised about the impact and benefits of extending Section 232 to downstream products, specifically in relation to Nucor.

The paragraph discusses the effects of certain legislative changes on the steel industry, highlighting a positive impact on import percentages, which have dropped below 20% for the first time in years. This is attributed to the inclusion of derivative products in legislation, a change from the previous administration. The conversation also touches on future steel pricing and margins, with expectations of stable margins due to falling substrate costs despite anticipated price declines over the next quarters. Some downstream businesses will experience a lag in realizing price increases, while tubular products are expected to benefit sooner due to their close relation to hot band prices.

The paragraph is a transcript of a Q&A session during an earnings call. Bill Peterson from JPMorgan asks about the stable outlook for the first and second quarters, specifically inquiring about the potential impact of extra shipping days and possible demand pull-forward due to tariffs. Leon Topalian responds by acknowledging a sense of urgency when tariffs were announced but notes that there hasn't been a drop-off in order entry rates or inquiries afterward. He emphasizes that demand has remained strong, and there is no decline in the backlog.

The paragraph discusses the strong position and optimistic outlook of Nucor due to their highest-ever structural backlog, primarily composed of orders from fabricators rather than distribution. This backlog represents numerous locked-in projects totaling hundreds of thousands of tons and indicates promising growth for the year. Nucor is confident about their ability to meet demand in sectors like data centers, energy, warehousing, and advanced manufacturing, especially with new plants coming online. The company is cautiously optimistic about upside potentials and is focused on delivering value to shareholders, specifically mentioning excitement about developments at their Brandenburg facility.

The paragraph discusses Nucor's excitement about its upcoming projects, including a new micro mill in Lexington, North Carolina, a melt shop in Kingman, Arizona, and new galvanizing lines. The company is optimistic about its growth potential over the next few years. The conversation shifts to financial details, with Steve Laxton explaining the occasional 95-day fiscal quarter due to differences between Nucor's financial calendar and the Gregorian calendar. He also addresses the higher-than-expected intersegment eliminations, attributing them to the strong pricing environment and broad-based strength across Nucor's portfolio.

The paragraph discusses a financial update from a company where Steve Laxton responds to questions from Mike Harris of Goldman Sachs. The company reported an adjusted earnings per share (EPS) of $0.77, exceeding the guided range of $0.50 to $0.60, primarily due to higher volumes in the steel segment, particularly in bar and sheet. Non-recurring adjustments related to the closure or repurposing of facilities also impacted the results. Additionally, Mike Harris notes a sequential decrease in gross margin by 120 basis points. Laxton attributes this margin squeeze to increased conversion costs in the steel mill business, driven by higher energy costs and slightly increased consumable expenses.

The paragraph discusses a financial discussion during an earnings call. Despite most costs remaining stable or decreasing year-over-year, scrap costs increased by 3% quarter-over-quarter, leading to a margin squeeze despite rising market prices. Katja Jancic from BMO Capital Markets confirms that the $3 billion CapEx for the year doesn't include tariff speculation. Equipment still needing importation will mainly come from Italy and Germany, indicating European exposure. The Brandenburg mill is producing at a pace of 150,000 to 160,000 tons and is expected to increase production throughout the year. Chris LaFemina from Jefferies inquires about demand, highlighting the strength of the order book despite pauses in commercial construction and inventory building in metals markets due to upcoming tariffs.

In the paragraph, Leon Topalian addresses concerns about differentiating between demand driven by tariff-related stockpiling and genuine underlying demand in the U.S. steel market. He asserts confidence in the outlook beyond the first quarter, citing the company's experience and understanding of their fabricator community, which typically does not engage in speculative preordering. He notes that distribution levels remain stable, indicating no significant impact on order strength. Additionally, their commercial teams maintain daily interactions with customers to gauge confidence levels, and there's a promising growth prospect in Brandenburg with a significant number of requests for quotations (RFQs) for the mill, particularly in the area of oil country tubular goods (OCTG).

The paragraph highlights the positive impact on Nucor's order book from various sectors, including energy, border wall-related tubular products, structural orders, and infrastructure projects driven by legislation like the IIJA, infrastructure bill, and the CHIPS Act. Contrary to concerns about project stagnation, Nucor is experiencing solid uptake with ongoing deliveries. In response to a question from Tristan Gresser of BNP Paribas about trade policy and potential tariff removals on pig iron and DRI shipments, CEO Leon Topalian emphasizes Nucor's active involvement in advocating for the steel industry with the U.S. administration. The company ensures that the administration, whether under President Biden or previously under President Trump, receives accurate industry impact information.

The paragraph discusses the progress and budget of a steel mill project in West Virginia. Tristan Gresser and Noah Hanners exchange information, with Hanners indicating that the project is on track for a late 2026 or early 2027 startup and is currently 40% to 50% complete. The focus is now shifting towards commissioning and entering the auto market. Leon Topalian adds that the budget increase for the project is due to inflation and rising costs in labor, materials, and fuel, not due to added scope or missed items. Despite cost challenges, the timeline and goals remain unchanged.

The paragraph is a discussion among various individuals about the financial and operational aspects of a certain company's projects, specifically focusing on a significant project in West Virginia. Steve Laxton mentions that while they won't give an exact figure, they have spent over half of their budget on the West Virginia project, which is part of a larger $3 billion capital plan for the year, mostly aimed at growth, with West Virginia being the largest project. The conversation shifts to Carlos de Alba from Morgan Stanley asking about capacity utilization and future expectations. Leon Topalian responds that although he's not forecasting exact utilization rates for the next quarter, current demand drivers look promising, and utilization rates have improved from 74-75% to 80%. They expect an increase in volumes over the year, with slight improvements in utilization. Carlos also inquires about inventories across Nucor’s operating segments, but the paragraph does not provide a specific answer.

In the paragraph, Carlos de Alba and Leon Topalian, along with Steve Laxton, discuss the inventory levels compared to historical averages. Carlos inquires about inventory, and Steve confirms that the inventories are aligned with seasonal adjustments and historical backlog levels. Leon Topalian then thanks the participants, highlights Nucor's strong financial position and commitment to safety for 2025, and appreciates the trust from shareholders and customers. The operator concludes the conference call.

This summary was generated with AI and may contain some inaccuracies.