07.26
Nucor reported Q2/09 FD EPS of a loss of $0.43 versus a loss of $0.60 in
Q1/09 and a profit of $1.94 in Q2/08. Earnings were above our estimate of
a loss of $0.68, consensus of a loss of $0.59 (loss of $0.52 – loss of $0.68)
and Nucor’s guidance of a loss of $0.55 – $0.65.
The better-than-expected results benefited from slightly higher shipments
(up 11.1% sequentially), a LIFO credit of $125 million ($0.40 per share)
and cost reduction activities; however, earnings were negatively impacted
by the consumption of the high-cost scrap purchased in mid-2008.
An end to inventory destocking suggests a reasonable increase in apparent
demand of approximately 23% in order to match inventory requirements at
the service centers. It is unclear when improvements in real demand will
materialize; however, planned auto production increases are encouraging.
Due to the better-than-expected Q2/09 results, our cautiously optimistic
outlook for increasing demand, and rising steel prices,
No Comment.
Add Your Comment