Steel Dynamics Has Good News for Q3

Chamber member Steel Dynamics, Inc. (Nasdaq-GS: STLD) announced yesterday net income of $69 million for the third quarter of 2009, or $0.30 per diluted share. The quarter's earnings compared to a net loss of $16 million, or $0.08 per diluted share, in the second quarter of 2009 and net income of $193 million, or $0.98 per diluted share, in the third quarter of 2008. The principal drivers as to why third quarter earnings exceeded September guidance were stronger-than-anticipated cost compression, resulting from higher production and shipping volumes at the Flat Roll Division, and better than expected performance in metals recycling.

Third quarter net sales of $1.2 billion increased significantly from $792 million in the second quarter of 2009, up 48 percent, but were down 54 percent from $2.6 billion when compared to the third quarter of 2008, a period when pricing reached historical peaks. Sequentially, shipping volumes in all segments except fabrication were up in the third quarter, as were selling prices.

"In the third quarter, the company's steel operations produced operating income of $128 million, or $105 per ton, while OmniSource made significant strides in earnings growth, resulting in operating income of $50 million during the quarter," said Keith Busse, Chairman and CEO. "I salute SDI's employees as these results are testament to our focus on efficient operations and cost control throughout the company. Our steelmaking divisions all produced pre-tax profits in the quarter, including the Structural and Rail Division which continues to face very challenging conditions in the construction marketplace. Our steel fabricating operations showed an operating loss of $3 million on continued weakness in non-residential construction."

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