BUTLER, INDIANA — July 15, 1998 — Steel Dynamics, Inc.
(NASDAQ: STLD) today announced consolidated earnings for the second
quarter of 1998 of $7.5 million or $.15 per share on a diluted basis.
Operating profit (operating income before start-up costs) was $17.1
million, or $53 per ton. Sales for the second quarter were $121.0
million on shipments of 324,000 tons. Start-up costs of the Second
Caster Project, the Structural Mill and Iron Dynamics were $1.1 million
in the quarter. Hot band production was 323,600 tons compared to 291,100
tons in the year-earlier quarter. In the second quarter of 1997, the
Company reported income of $15.6 million, $.32 per share on a diluted
basis, on shipments of 295,300 tons.
Keith Busse, SDI’s CEO, said, “When one considers all of the items
affecting our bottom line, substantial progress was made in the second
quarter of 1998 versus the first quarter’s results. Our revenue was up
$5 per ton, and our costs were lower by $9 per ton resulting in our
operating margin growing by $14 per ton. Expressed another way, our
operating income increased by 44%. By comparison to the second quarter
of 1997, our 1998 results were still lagging. Steel Dynamics started
production on its second caster in June of this year, although any
significant benefit to the Company was clouded by the apparent
short-term energy crisis in the Midwest. This unforeseen problem cost
SDI approximately 25,000 tons of production in June at estimated
marginal operating profits of $100 per ton, coupled with power-cost
increases of over $1.0 million in the month. The impact to earnings is
estimated at $.04 – $.05 per share.”
The Company anticipates that with its two first half start-ups now
behind it, the Cold Mill and the second caster should now be in a
position to exert a positive impact on future earnings. The Cold Mill is
now capable of running at near capacity and the second caster is
running extremely well. The Company’s Iron Dynamics project is coming
along nicely, with an anticipated fourth quarter start-up. The Company
has also now chosen an excellent site for its new structural steel
making project in Whitley County, Indiana, in the heart of its consuming
market, and start-up of that facility is anticipated in the first half
of the year 2000.
The Company over the second quarter repurchased an aggregate amount
of 840,000 shares at an average price of $16.27 per share pursuant to
its stock buyback plan. |