NASDAQ$STLD

Steel Dynamics Inc · Q3 2020 earnings

Q3 2020 earnings · · Investor relations

Briefing

Reported a solid performance amidst the coronavirus pandemic, driven by strong domestic steel demand recovery and operational excellence.

Steel Dynamics reported Q3 2020 net sales of $2.3 billion and net income of $100 million, or $0.47 per diluted share. Excluding certain items, adjusted net income was $108 million, or $0.51 per diluted share. The company benefited from a strong recovery in domestic steel demand, particularly in the automotive sector, and resilient construction activity.

  • Steel mills operated at 85% of production capability, with flat roll group achieving 99%.
  • Steel fabrication operations achieved record quarterly operating income of $39 million.
  • Metals recycling operations saw improved operating income of $15 million, compared to a loss in the previous quarter.
  • The company expects continued price strength and customer demand throughout 2020 and into 2021.

Headline financials

Total Revenue

$2.33B

Previous: $2.53B-7.8%
EPS (adj)

$0.51

Previous: $0.69-26.1%
Steel ASP

$734.00

No prior period
Ferrous Shipments

259

No prior period
Capital Expenditures

-$328M

Previous: -$154M-112.6%
Free Cash Flow

-$223M

Previous: -$1.52M-14566.4%
Net Income

$104M

Previous: $153M-31.7%
Operating Income

$156M

Previous: $228M-31.7%
Gross Profit

$293M

Previous: $360M-18.6%
Cash & Equivalents

$1.27B

Previous: $1.15B+10.6%
Total Assets

$8.62B

Previous: $7.94B+8.5%
Stock-Based Comp

$9.49M

Previous: $8.84M+7.3%

Revenue & EPS history

Steel Dynamics · Revenue · Quarterly

$2.33B

Q3 2020-7.8%vs Q3 2019
Beat estimate in 13 of 16 quarters(81%)
ActualEstimate

Revenue by segment

Steel Dynamics · $1.21B total across 3 segments · Q2 2023

  • Steel Operations
    $706M-35.8%
  • Steel Fabrication
    $462M-22.9%
  • Metals Recycling
    $40M-31.0%

Forward guidance

Steel Dynamics anticipates continued price strength and customer demand throughout 2020 and into 2021, driven by a solid recovery in domestic steel demand, particularly in the automotive and construction sectors. The company's new Texas steel mill project remains on track, with operations expected to commence mid-year 2021.

Tailwinds

  • Continued price strength in the steel market.
  • Strong customer demand expected throughout 2020 and into 2021.
  • Solid recovery in domestic steel demand.
  • Automotive sector showing the strongest improvement.
  • Construction sector remains resilient.

Headwinds

  • Domestic economy is recovering from the shock of COVID-19.
  • It is still difficult to know the full extent of its eventual impact.
  • Energy remains the weakest end market.
  • Steel service center inventories were extremely low and still remain low compared to historical norms.
  • Uncertainty related to the full impact of COVID-19 on the economy.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2020

Historical avgQ3 2020

+0.4%

Avg return

Earnings day

+1.5%

Avg return

5 days after

+4.7%

Avg return

30 days after

56%

40 / 72 earnings

Positive

+16.7%

Q2 2014

Best reaction

-12.1%

Q2 2011

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q4 2025-4.3%+8.3%+8.9%
Q1 2026+0.2%+2.2%+9.0%
Q3 2025+5.1%+4.6%+4.7%
Q2 2025-0.8%-1.6%+2.5%
Q1 2025+4.3%+9.0%+6.8%
Q4 2024-0.4%+3.4%+6.4%
Q3 2024+5.1%+3.9%+8.5%
Q2 2024-2.7%-3.7%-12.1%
Q1 2024-5.4%-2.4%-2.7%
Q4 2023+1.0%+0.5%+8.1%
Q3 2023-7.1%-7.5%+3.9%
Q2 2023-6.0%-6.2%-3.2%
Q1 2023+3.7%+1.4%-9.7%
Q4 2022+12.4%+10.2%+9.7%
Q3 2022+4.8%+17.8%+23.1%
Q2 2022+6.2%+5.1%+22.8%
Q1 2022+1.4%-2.9%-17.5%
Q4 2021+3.2%+4.7%+18.5%
Q3 2021+2.6%+2.6%+1.7%
Q2 2021-1.3%-1.3%+15.6%
Q1 2021-2.7%+0.8%+20.8%
Q4 2020-5.4%-11.4%+13.3%
Q3 2020-4.5%-2.4%+6.7%
Q2 2020+0.9%+3.8%+12.5%
Q1 2020-5.3%+0.3%+4.9%
Q4 2019-0.9%-4.9%-7.0%
Q3 2019-4.6%-4.9%+5.8%
Q2 2019+2.0%+3.6%-11.6%
Q1 2019-3.4%-7.0%-14.5%
Q4 2018+1.5%+3.3%+12.5%
Q3 2018+2.6%+3.1%-1.4%
Q2 2018+4.6%+2.2%-3.6%
Q1 2018+1.7%-1.3%+9.8%
Q4 2017-0.1%+2.3%+3.7%
Q3 2017+4.5%+7.4%+1.9%
Q2 2017+3.3%+2.8%-6.1%
Q1 2017+6.9%+12.1%+4.7%
Q4 2016-4.6%+2.1%+0.1%
Q3 2016+9.6%+7.4%+37.7%
Q2 2016-3.6%-5.3%-8.8%
Q1 2016+0.4%
Q4 2015+4.5%
Q3 2015-5.8%
Q2 2015+1.1%
Q1 2015+4.1%
Q4 2014-4.2%
Q3 2014+4.0%
Q2 2014+16.7%
Q1 2014-4.6%
Q4 2013-0.6%
Q3 2013+3.9%
Q2 2013-0.1%
Q1 2013-1.4%
Q4 2012+1.2%
Q3 2012+4.5%
Q2 2012+0.6%
Q1 2012+2.2%
Q4 2011+2.0%
Q4 2010+2.0%
Q3 2011-4.2%
Q2 2011-12.1%
Q1 2011-2.0%
Q3 2010+1.4%
Q2 2010+2.5%
Q1 2010+1.4%
Q4 2007-3.8%
Q4 2009-3.8%
Q3 2009+1.1%
Q3 2008+1.1%
Q2 2009-2.8%
Q4 2008-2.8%
Q2 2008-2.8%

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