FORT WAYNE, INDIANA, April 21, 2003 Today Steel Dynamics, Inc. (NASDAQ:STLD)
announced first quarter earnings of $15.8 million, or $.33 per diluted
share, compared to earnings of $1.6 million, and diluted earnings per
share of $.04 in the first quarter of 2002. Net sales for the first
quarter of 2003 were $236 million, a 41 percent increase compared to the
first quarter of 2002. SDI’s first quarter 2003 results were much
stronger than the first quarter of 2002 due to higher shipping volumes
and higher selling prices that resulted from stronger market conditions.
SDI’s first quarter consolidated shipments of 648,000 tons were 15
percent higher than shipments in the year-ago quarter and 8 percent
higher than shipments in the fourth quarter of 2002. First-quarter
average consolidated selling price per ton was $363, compared to $297
per ton recorded for the first quarter of 2002 and $403 per ton in the
fourth quarter of 2002.
“We are pleased with the quarter’s results,” said Keith Busse,
president and chief executive officer, “in light of the continued slow
economic environment which resulted in lower than initially anticipated
first-quarter average selling prices and somewhat lower shipping
volumes. Nevertheless, production and shipping levels were sufficient to
allow us to maintain solid profitability, although margins were
adversely affected by lower realized selling prices for flat-rolled
steels.
“The Structural and Rail Division continued product commissioning in
the first quarter and increased its shipments substantially from the
prior quarter despite ramping up during a period of lackluster
commercial and industrial construction activity. Operationally, the new
mill, its equipment, and its new workforce are performing extremely
well. Production trials of rail are expected to begin in the second
quarter,” Busse said.
In the first quarter, Steel Dynamics shipped for export to China
129,000 tons of thin-gauge, hot-rolled and cold-rolled steel, and
expects to continue to ship additional volumes in the second quarter.
“These orders represent a welcome opportunity for the company to supply
its products to the international market, but the extent of any ongoing
business that will result is uncertain,” Busse said.
“Previously announced new business development projects are
proceeding as planned,” Busse said, “Our team at the newly formed Bar
Products Division is making excellent progress in engineering and
facility planning. The former Qualitech SBQ mill near Indianapolis is
expected to begin production as SDI’s third mini-mill in the first
quarter of 2004.” SDI now expects to invest a total of approximately $75
million in 2003 and 2004 to broaden the capabilities of this bar mill
to produce merchant shapes and reinforcing bars, as well as
special-bar-quality steels.
During the first quarter, in an effort to expand its Flat Roll
Division’s finishing capabilities, Steel Dynamics completed the purchase
of a modern galvanizing plant in Jeffersonville, Indiana, formerly
owned by GalvPro. The purchase price for this next-to-new facility was
$17.5 million, plus up to an additional $1.5 million payment subject to
an earn-out formula. SDI expects to invest $2 to $6 million at the
facility to improve material handling capability and increase
throughput. Production is expected to begin in the third quarter of
2003. Located at the Clark Maritime Center on the Ohio River, this plant
will provide SDI access to low-cost river transportation through use of
the port facilities, making the company’s flat-roll products more
competitive in Southern markets.
SDI’s Flat Roll Division also is making rapid progress in the
construction and installation of its new paint line at Butler, Indiana,
which is expected to begin operations in September 2003. Customer
interest is very strong for this new painted-steel product offering.
Additionally, the company’s Iron Dynamics facility is being readied
for restart this fall and orders have been placed for the necessary
briquetting equipment that will be installed at the facility. In the
first quarter Steel Dynamics also increased its ownership in New
Millennium Building Systems, LLC to 100 percent from the 46.6 percent
stake that it had owned previously. New Millennium manufactures joists,
girders, trusses, and steel decking, and now operates as a wholly owned
subsidiary of Steel Dynamics.
Download Unaudited Financial Statements (RTF file)
Conference Call Webcast Available on SDI Web Site
A conference call in which Steel Dynamics’ management will discuss
the company’s first quarter 2003 results and the business outlook is
scheduled for 11:00 am EDT (10:00 am Central) on April 22, 2003.
You are invited to listen in to the live broadcast of the conference
call over the Internet, accessible from Steel Dynamics’ Web site home
page. A replay of the Webcast will be available from the SDI Web site
until May 9, 2003.
The Webcast, as well as other information about Steel Dynamics, can be found at: www.steeldynamics.com
Annual Meeting Webcast
Steel Dynamics’ 2003 Annual Shareholders Meeting is scheduled in Fort
Wayne, Indiana, on May 29, 2003, at 10:00 am EDT (9:00 am Central). The
meeting will be Webcast live, accessible from SDI’s Web site home page.
Forward Looking Statements
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