FORT WAYNE, Ind., April 22, 2025 /PRNewswire/ --
First Quarter 2025 Performance Highlights:
- Record steel shipments of 3.5 million tons
- Net sales of $4.4 billion, operating income of $275 million, and net income of $217 million
- Adjusted EBITDA of $448 million and cash flow from operations of $153 million, which was reduced by the annual companywide retirement profit-sharing distribution of $165 million in the quarter
- Strong liquidity of $2.6 billion as of March 31, 2025
- Share repurchases of $250 million of the company's common stock, representing 1.3 percent of its outstanding shares
- First quarter 2025 cash dividend increase of 9 percent
Steel Dynamics, Inc. (STLD) today announced first quarter 2025 financial results. The company reported first quarter 2025 net sales of $4.4 billion and net income of $217 million, or $1.44 per diluted share. Comparatively, the company's sequential fourth quarter 2024 net income was $207 million, or $1.36 per diluted share and prior year first quarter net income was $584 million, or $3.67 per diluted share.
"The teams executed well, achieving a solid first quarter 2025 performance, increasing sequential operating income 16 percent and adjusted EBITDA 21 percent," said Mark D. Millett, Chairman and Chief Executive Officer. "The improvement in earnings was driven by record steel shipments and supported by solid results from our metals recycling and steel fabrication operations. Our three-year after-tax return-on-invested capital of 20 percent is a testament to our ongoing high-return capital allocation execution. Across the company, our teams had a solid performance, while keeping each other safe.
"Underlying steel demand improved in the first quarter as customer orders rebounded and backlogs increased throughout the quarter at our steel and steel fabrication operations. Steel prices improved throughout the quarter from the lows seen in the second half of 2024 as trade actions have seen imports decline from recent highs. We should see the benefit from these higher steel prices in the coming months, as lagging flat rolled steel contracts roll. In combination with our ongoing value-added flat rolled steel and aluminum expansion initiatives, there are firm drivers in place for our continued growth."
First Quarter 2025 Comments
First quarter 2025 operating income for the company's steel operations was $230 million, or 39 percent higher than sequential fourth quarter results, due to record shipments more than offsetting metal spread compression, as lagging contractual flat rolled steel pricing in the quarter did not reflect recent price improvements, which will be realized in the coming months. The first quarter 2025 average external product selling price for the company's steel operations decreased $13 sequentially to $998 per ton. The average ferrous scrap cost per ton melted at the company's steel mills increased $16 sequentially to $386 per ton. The energy, non-residential construction, automotive, and industrial sectors led steel demand in the quarter. Flat rolled steel pricing has rebounded from recent lows and steel producer lead times have extended. The company's Sinton Texas Flat Roll Division operated at an 86 percent rate of capacity for the full quarter and often times at production levels in excess of 90 percent. Value-added product quality and cost efficiency initiatives have been successful and are ongoing, providing a clear path to significantly higher escalating profitability in the coming quarters. Sinton was EBITDA positive for the first quarter 2025.
Compared to the sequential fourth quarter, first quarter 2025 operating income from the company's metals recycling operations increased to $26 million, based on stronger realized ferrous scrap pricing and modestly higher shipments across the platform.
The company's steel fabrication operations achieved operating income of $117 million in the first quarter 2025, below sequential results due to seasonally lower shipments combined with metal spread compression related to lower realized pricing. The pace of order activity increased during the first quarter, improving the order backlog which extends into the fourth quarter 2025, with attractive pricing levels. Improved demand was supported largely by the commercial, data center, manufacturing, warehouse, and healthcare sectors. Further, the accelerated announcements related to meaningful domestic investments in manufacturing and increased onshoring, coupled with the U.S. infrastructure program, are expected to positively impact demand for not only steel joist and deck products, but also for flat rolled and long product steel.
On March 12, 2025, the company issued $1.0 billion in unsecured notes, comprised of $600 million of 5.250% notes due 2035 and $400 million of 5.750% notes due 2055. The net proceeds from the notes will be used for general corporate purposes, which may include repayment of the company's $400 million 2.400% senior notes due June 2025.
Based on the company's differentiated business model and highly variable cost structure, the company generated cash flow from operations of $153 million during the quarter, even after funding the companywide retirement profit-sharing distribution of $165 million. The company also invested $306 million in capital investments, paid cash dividends of $70 million, and repurchased $250 million of its outstanding common stock, representing 1.3 percent of its outstanding shares, while maintaining strong liquidity of $2.6 billion as of March 31, 2025.
Outlook
"We remain constructive that market conditions are in place for domestic steel consumption to be solid through 2025 and into the following years," said Millett. "Order entry activity improved across our businesses and steel pricing firmed in the first quarter 2025. However, we have seen some uncertainty from certain customers related to recent trade actions. Overall, we believe demand for lower-carbon emission, U.S. produced steel products coupled with lower imports will support steel pricing and demand. The continued onshoring of manufacturing businesses, combined with the expectation of fixed asset investment to be derived from public and private funding should competitively position the domestic steel industry. We also expect the recent International Trade Commission's preliminary determinations related to coated flat rolled steel to reduce the amount of unfairly traded imports of these products into the United States, which could have a significant positive impact for us, as we are the largest non-automotive flat rolled steel coater in the United States. We believe these broader dynamics will benefit all of our operating platforms.
"Our four new value-added flat rolled steel coating lines continue to increase utilization and we expect to realize full run rate earnings potential in the second half 2025. Value-added product investments such as these enhance our differentiated supply-chain capabilities, while also increasing our higher-margin product offerings, which already represent over 65 percent of our steel revenues.
"The aluminum team is continuing with successful commissioning of the company's Columbus, Mississippi aluminum flat rolled products mill, along with the San Luis Potosi, Mexico satellite recycled slab center. The Mississippi team successfully cast its first aluminum ingot in January 2025 and the Mexico team in March 2025. Construction is near completion on the hot and cold mills. The finishing equipment installation for the automotive treatment and can sheet coating lines are also on schedule. The company continues to expect to ship commercial aluminum flat rolled coils mid-2025.
"We have intentionally grown with our customers' needs, providing efficient sustainable supply-chain solutions for the highest quality products. Thus far, this has primarily been achieved within the steel industry — however, a significant number of our flat rolled steel customers are also consumers and processors of aluminum flat rolled products. We are pleased to further diversify our end markets with plans to supply aluminum flat rolled products with high recycled content to the countercyclical sustainable beverage can and packaging industry, in addition to the automotive, industrial, and construction sectors. We believe our unique performance-based operating culture, coupled with our considerable experience in successfully constructing and operating cost-effective, highly profitable flat rolled steel mills, positions us exceptionally well to execute this strategic opportunity and to deliver strong long-term value creation. Our customers and our people are also incredibly excited for this growth opportunity.
"Our commitment is to the health and safety of our teams, families, and communities, while meeting the current and future needs of our customers. Our culture and business model continues to positively differentiate our performance from the rest of the industry. We continue to focus on delivering superior value to our team members, customers, and shareholders," concluded Millett.
Conference Call and Webcast
Steel Dynamics, Inc. will hold a conference call to discuss first quarter 2025 operating and financial results on Wednesday, April 23, 2025, at 11:00 a.m. Eastern Daylight Time. You may access the call and find dial-in information on the Investors section of the company's website at www.steeldynamics.com. A replay of the call will be available on our website until 11:59 p.m. Eastern Daylight Time on April 30, 2025.
About Steel Dynamics, Inc.
Steel Dynamics is a leading industrial metals solutions company, with facilities located throughout the United States, and in Mexico. The company operates using a circular manufacturing model, producing lower-carbon-emission, quality products with recycled scrap as the primary input. Steel Dynamics is one of the largest domestic steel producers and metal recyclers in North America, combined with a meaningful downstream steel fabrication platform. The company is also currently investing in aluminum operations to further diversify its product offerings, with plans to supply aluminum flat rolled products with high recycled content to the countercyclical sustainable beverage can industry, in addition to the automotive and industrial sectors. Steel Dynamics is committed to operating with the highest integrity and to being the safest, most efficient producer of high-quality, broadly diversified, value-added metal products.
Note Regarding Financial Metrics
The company believes that after-tax return-on-invested capital (After-tax ROIC) provides an indication of the effectiveness of the company's invested capital and is calculated as follows:
|
After-tax ROIC = |
Net Income Attributable to Steel Dynamics, Inc. |
|
(Quarterly Average Current Maturities of Long-term Debt + Long-term Debt + Total Equity) |
Note Regarding Non-GAAP Financial Measures
The company reports its financial results in accordance with U.S. generally accepted accounting principles (GAAP). Management believes that the non-GAAP financial measures EBITDA and Adjusted EBITDA provide additional meaningful information regarding the company's performance and financial strength. Non-GAAP financial measures should be viewed in addition to and not as an alternative for the company's reported results prepared in accordance with GAAP. In addition, not all companies use identical calculations for EBITDA or Adjusted EBITDA; therefore, EBITDA and Adjusted EBITDA included in this release may not be comparable to similarly titled measures of other companies.
Forward-Looking Statements
This press release contains some predictive statements about future events, including statements related to conditions in domestic or global economies, conditions in steel, aluminum, and recycled metals market places, Steel Dynamics' revenues, costs of purchased materials, future profitability and earnings, and the operation of new, existing or planned facilities. These statements, which we generally precede or accompany by such typical conditional words as "anticipate", "intend", "believe", "estimate", "plan", "seek", "project", or "expect", or by the words "may", "will", or "should", are intended to be made as "forward-looking", subject to many risks and uncertainties, within the safe harbor protections of the Private Securities Litigation Reform Act of 1995. These statements speak only as of this date and are based upon information and assumptions, which we consider reasonable as of this date, concerning our businesses and the environments in which they operate. Such predictive statements are not guarantees of future performance, and we undertake no duty to update or revise any such statements. Some factors that could cause such forward-looking statements to turn out differently than anticipated include: (1) domestic and global economic factors; (2) global steelmaking overcapacity and imports of steel, together with increased scrap prices; (3) pandemics, epidemics, widespread illness or other health issues; (4) the cyclical nature of the steel industry and the industries we serve; (5) volatility and major fluctuations in prices and availability of scrap metal, scrap substitutes and supplies, and our potential inability to pass higher costs on to our customers; (6) cost and availability of electricity, natural gas, oil, and other energy resources are subject to volatile market conditions; (7) increased environmental, greenhouse gas emissions and sustainability considerations from our customers and investors or related regulations; (8) compliance with and changes in environmental and remediation requirements; (9) significant price and other forms of competition from other steel and aluminum producers, scrap processors and alternative materials; (10) availability of an adequate source of supply of scrap for our metals recycling operations; (11) cybersecurity threats and risks to the security of our sensitive data and information technology; (12) the implementation of our growth strategy; (13) our ability to retain, develop, and attract key personnel; (14) litigation and legal compliance; (15) unexpected equipment downtime or shutdowns; (16) governmental agencies may refuse to grant or renew some of our licenses and permits; (17) our senior unsecured credit facility contains, and any future financing agreements may contain, restrictive covenants that may limit our flexibility; and (18) the impacts of impairment charges.
More specifically, we refer you to our more detailed explanation of these and other factors and risks that may cause such predictive statements to turn out differently, as set forth in our most recent Annual Report on Form 10-K under the headings Special Note Regarding Forward-Looking Statements and Risk Factors, in our Quarterly Reports on Form 10-Q, or in other reports which we file with the Securities and Exchange Commission. These reports are available publicly on the Securities and Exchange Commission website, www.sec.gov, and on our website, www.steeldynamics.com under "Investors – SEC Filings."
|
Steel Dynamics, Inc. CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)(in thousands, except per share data) | |||||||||
|
Three Months Ended |
Three Months |
||||||||
|
March 31, |
Ended |
||||||||
|
2025 |
2024 |
Dec. 31, 2024 |
|||||||
|
Net sales |
$ |
4,369,195 |
$ |
4,694,003 |
$ |
3,872,138 |
|||
|
Costs of goods sold |
3,882,651 |
3,713,205 |
3,430,404 |
||||||
|
Gross profit |
486,544 |
980,798 |
441,734 |
||||||
|
Selling, general and administrative expenses |
181,808 |
159,507 |
176,904 |
||||||
|
Profit sharing |
22,695 |
62,652 |
19,755 |
||||||
|
Amortization of intangible assets |
6,897 |
7,664 |
7,573 |
||||||
|
Operating income |
275,144 |
750,975 |
237,502 |
||||||
|
Interest expense, net of capitalized interest |
12,131 |
11,978 |
14,579 |
||||||
|
Other (income) expense, net |
(17,641) |
(26,784) |
(21,040) |
||||||
|
Income before income taxes |
280,654 |
765,781 |
243,963 |
||||||
|
Income tax expense |
62,975 |
178,281 |
34,091 |
||||||
|
Net income |
217,679 |
587,500 |
209,872 |
||||||
|
Net income attributable to noncontrolling interests |
(528) |
(3,459) |
(2,579) |
||||||
|
Net income attributable to Steel Dynamics, Inc. |
$ |
217,151 |
$ |
584,041 |
$ |
207,293 |
|||
|
Basic earnings per share attributable to |
|||||||||
|
Steel Dynamics, Inc. stockholders |
$ |
1.45 |
$ |
3.68 |
$ |
1.36 |
|||
|
Weighted average common shares outstanding |
150,262 |
158,666 |
152,096 |
||||||
|
Diluted earnings per share attributable to |
|||||||||
|
Steel Dynamics, Inc. stockholders, including the |
|||||||||
|
effect of assumed conversions when dilutive |
$ |
1.44 |
$ |
3.67 |
$ |
1.36 |
|||
|
Weighted average common shares |
|||||||||
|
and share equivalents outstanding |
150,809 |
159,354 |
152,801 |
||||||
|
Dividends declared per share |
$ |
0.50 |
$ |
0.46 |
$ |
0.46 |
|||
|
Steel Dynamics, Inc. CONSOLIDATED BALANCE SHEETS (in thousands) | |||||||
|
March 31, |
December 31, |
||||||
|
Assets |
2025 |
2024 |
|||||
|
(unaudited) |
|||||||
|
Current assets |
|||||||
|
Cash and equivalents |
$ |
1,186,917 |
$ |
589,464 |
|||
|
Short-term investments |
19,636 |
147,811 |
|||||
|
Accounts receivable, net |
1,720,801 |
1,417,199 |
|||||
|
Inventories |
3,099,054 |
3,113,733 |
|||||
|
Other current assets |
190,297 |
163,131 |
|||||
|
Total current assets |
6,216,705 |
5,431,338 |
|||||
|
Property, plant and equipment, net |
8,322,652 |
8,117,988 |
|||||
|
Intangible assets, net |
220,336 |
227,234 |
|||||
|
Goodwill |
477,471 |
477,471 |
|||||
|
Other assets |
693,264 |
681,202 |
|||||
|
Total assets |
$ |
15,930,428 |
$ |
14,935,233 |
|||
|
Liabilities and Equity |
|||||||
|
Current liabilities |
|||||||
|
Accounts payable |
$ |
1,257,686 |
$ |
979,912 |
|||
|
Income taxes payable |
43,249 |
3,783 |
|||||
|
Accrued expenses |
546,576 |
739,898 |
|||||
|
Current maturities of long-term debt |
418,947 |
426,990 |
|||||
|
Total current liabilities |
2,266,458 |
2,150,583 |
|||||
|
Long-term debt |
3,777,132 |
2,804,017 |
|||||
|
Deferred income taxes |
918,435 |
902,186 |
|||||
|
Other liabilities |
134,509 |
133,201 |
|||||
|
Total liabilities |
7,096,534 |
5,989,987 |
|||||
|
Commitments and contingencies |
|||||||
|
Redeemable noncontrolling interests |
171,212 |
171,212 |
|||||
|
Equity |
|||||||
|
Common stock |
652 |
652 |
|||||
|
Treasury stock, at cost |
(7,334,595) |
(7,094,266) |
|||||
|
Additional paid-in capital |
1,218,235 |
1,229,819 |
|||||
|
Retained earnings |
14,940,418 |
14,798,082 |
|||||
|
Total Steel Dynamics, Inc. equity |
8,824,710 |
8,934,287 |
|||||
|
Noncontrolling interests |
(162,028) |
(160,253) |
|||||
|
Total equity |
8,662,682 |
8,774,034 |
|||||
|
Total liabilities and equity |
$ |
15,930,428 |
$ |
14,935,233 |
|||
|
Steel Dynamics, Inc. CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (in thousands) | ||||||
|
Three Months Ended |
||||||
|
March 31, |
||||||
|
2025 |
2024 |
|||||
|
Operating activities: |
||||||
|
Net income |
$ |
217,679 |
$ |
587,500 |
||
|
Adjustments to reconcile net income to net cash provided by |
||||||
|
operating activities: |
||||||
|
Depreciation and amortization |
133,756 |
115,252 |
||||
|
Equity-based compensation |
17,040 |
15,612 |
||||
|
Deferred income taxes |
16,249 |
(21,024) |
||||
|
Other adjustments |
(4,195) |
18,705 |
||||
|
Changes in certain assets and liabilities: |
||||||
|
Accounts receivable |
(303,602) |
(130,753) |
||||
|
Inventories |
13,810 |
(133,025) |
||||
|
Other assets |
(32,115) |
(12,176) |
||||
|
Accounts payable |
248,600 |
29,499 |
||||
|
Income taxes receivable/payable |
42,815 |
165,664 |
||||
|
Accrued expenses |
(197,434) |
(280,037) |
||||
|
Net cash provided by operating activities |
152,603 |
355,217 |
||||
|
Investing activities: |
||||||
|
Purchases of property, plant and equipment |
(305,506) |
(374,310) |
||||
|
Purchases of short-term investments |
(10,000) |
(205,873) |
||||
|
Proceeds from maturities of short-term investments |
137,811 |
272,994 |
||||
|
Other investing activities |
(1,064) |
14,255 |
||||
|
Net cash used in investing activities |
(178,759) |
(292,934) |
||||
|
Financing activities: |
||||||
|
Issuance of current and long-term debt |
1,405,943 |
379,268 |
||||
|
Repayment of current and long-term debt |
(432,527) |
(413,939) |
||||
|
Dividends paid |
(69,514) |
(68,008) |
||||
|
Purchase of treasury stock |
(250,138) |
(298,059) |
||||
|
Other financing activities |
(30,469) |
(23,108) |
||||
|
Net cash provided by (used in) financing activities |
623,295 |
(423,846) |
||||
|
Increase (decrease) in cash, cash equivalents, and restricted cash |
597,139 |
(361,563) |
||||
|
Cash, cash equivalents, and restricted cash at beginning of period |
595,010 |
1,406,464 |
||||
|
Cash, cash equivalents, and restricted cash at end of period |
$ |
1,192,149 |
$ |
1,044,901 |
||
|
Supplemental disclosure information: |
||||||
|
Cash paid for interest |
$ |
28,477 |
$ |
9,327 |
||
|
Cash paid for income taxes, net |
$ |
3,717 |
$ |
28,390 |
||
|
Steel Dynamics, Inc. SUPPLEMENTAL INFORMATION (UNAUDITED) (dollars in thousands) | |||||||||
|
First Quarter |
|||||||||
|
2025 |
2024 |
Q4 2024 |
|||||||
|
External Net Sales |
|||||||||
|
Steel |
$ |
3,067,016 |
$ |
3,366,237 |
$ |
2,645,994 |
|||
|
Steel Fabrication |
352,307 |
447,179 |
396,226 |
||||||
|
Metals Recycling |
534,895 |
507,270 |
482,081 |
||||||
|
Aluminum |
66,576 |
62,203 |
60,099 |
||||||
|
Other |
348,401 |
311,114 |
287,738 |
||||||
|
Consolidated Net Sales |
$ |
4,369,195 |
$ |
4,694,003 |
$ |
3,872,138 |
|||
|
Operating Income (Loss) |
|||||||||
|
Steel |
$ |
229,963 |
$ |
674,648 |
$ |
164,989 |
|||
|
Steel Fabrication |
116,745 |
178,381 |
142,189 |
||||||
|
Metals Recycling |
25,710 |
16,659 |
23,361 |
||||||
|
Aluminum |
(28,735) |
(7,555) |
(28,896) |
||||||
|
343,683 |
862,133 |
301,643 |
|||||||
|
Non-cash amortization of intangible assets |
(6,897) |
(7,664) |
(7,573) |
||||||
|
Profit sharing expense |
(22,695) |
(62,652) |
(19,755) |
||||||
|
Non-segment operations |
(38,947) |
(40,842) |
(36,813) |
||||||
|
Consolidated Operating Income |
$ |
275,144 |
$ |
750,975 |
$ |
237,502 |
|||
|
Adjusted EBITDA |
|||||||||
|
Net income |
$ |
217,679 |
$ |
587,500 |
$ |
209,872 |
|||
|
Income taxes |
62,975 |
178,281 |
34,090 |
||||||
|
Net interest expense (income) |
2,316 |
(14,327) |
(3,481) |
||||||
|
Depreciation |
125,122 |
106,030 |
116,147 |
||||||
|
Amortization of intangible assets |
6,897 |
7,664 |
7,573 |
||||||
|
EBITDA |
414,989 |
865,148 |
364,201 |
||||||
|
Non-cash adjustments |
|||||||||
|
Unrealized (gains) losses on derivatives |
|||||||||
|
and currency remeasurement |
19,153 |
(1,347) |
(17,703) |
||||||
|
Equity-based compensation |
14,181 |
14,825 |
25,121 |
||||||
|
Adjusted EBITDA |
$ |
448,323 |
$ |
878,626 |
$ |
371,619 |
|||
|
Other Operating Information |
|||||||||
|
Steel |
|||||||||
|
Average external sales price (Per ton) |
$ |
998 |
$ |
1,201 |
$ |
1,011 |
|||
|
Average ferrous cost (Per ton melted) |
$ |
386 |
$ |
417 |
$ |
370 |
|||
|
Flat Roll shipments |
|||||||||
|
Butler, Columbus, and Sinton |
2,119,187 |
1,993,305 |
1,841,745 |
||||||
|
Steel Processing divisions * |
492,627 |
418,547 |
460,162 |
||||||
|
Long Product shipments |
|||||||||
|
Structural and Rail Division |
437,398 |
440,921 |
362,650 |
||||||
|
Engineered Bar Products Division |
191,658 |
191,373 |
151,239 |
||||||
|
Roanoke Bar Division |
144,186 |
124,920 |
123,133 |
||||||
|
Steel of West Virginia |
96,483 |
86,528 |
81,387 |
||||||
|
Total Shipments (Tons) |
3,481,539 |
3,255,594 |
3,020,316 |
||||||
|
External Shipments (Tons) |
3,071,735 |
2,803,569 |
2,617,914 |
||||||
|
Steel Mill Production (Tons) |
3,021,593 |
2,992,018 |
2,663,444 |
||||||
|
Metals Recycling |
|||||||||
|
Nonferrous shipments (000's of pounds) |
233,080 |
243,950 |
226,434 |
||||||
|
Ferrous shipments (Gross tons) |
1,452,432 |
1,457,789 |
1,421,021 |
||||||
|
External ferrous shipments (Gross tons) |
557,618 |
536,973 |
529,335 |
||||||
|
Steel Fabrication |
|||||||||
|
Average sales price (Per ton) |
$ |
2,599 |
$ |
3,141 |
$ |
2,718 |
|||
|
Shipments (Tons) |
135,581 |
143,842 |
145,901 |
||||||
|
Beginning the fourth quarter 2024, results from an entity previously included in Metals Recycling are presented within Aluminum. All prior periods presented have been recast to reflect the change. | |||||||||
|
* Includes Heartland, The Techs and United Steel Supply operations | |||||||||
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SOURCE Steel Dynamics, Inc.