FT. WAYNE, INDIANA — April 11, 2000 — Steel Dynamics, Inc.
(NASDAQ: STLD) today announced first quarter 2000 consolidated earnings
of $15.2 million or $.32 per diluted share, compared to $3.0 million, or
$.06 per diluted share, for the first quarter of 1999. Operating profit
(operating income before start-up costs) was $36.3 million, or $71 per
ton shipped on sales of $189.2 million, compared to an operating profit
of $39 per ton shipped for the first quarter of 1999 on sales of $117.5
million.
SDI’s first quarter shipments of 511,200 tons increased 38% compared
to the first quarter of 1999. First quarter hot band production reached
548,800 tons, increasing 144,200 tons, or 36%, from the year-earlier
quarter.
Keith Busse, SDI’s President and CEO, stated, “Steel Dynamics had an
excellent quarter. Our $36.3 million of operating profit was our best
quarterly achievement since our start-up in 1996. Compared to the first
quarter of 1999, net income grew by more than 400% on a 61% increase in
sales. Our flat roll mill finished out the quarter with record monthly
production in March of 196,000 tons. The mill achieved an operating
profit per ton of $71 in the first quarter, a level we last realized
early in 1997. I am extremely pleased with the results attained by the
dedicated employees of our Flat Roll Steel Division.
Further commenting, Busse said, “We have realized our fourth
consecutive quarter of increased product prices, continuing the recovery
from the extremely depressed pricing environment of 1998-99 brought
about by the steel import crisis. Our mix-average first-quarter selling
prices were 7% higher than the fourth quarter of 1999. We continue to
see strong demand for our products, with solid forward bookings at
favorable prices. Resource costs, although higher than 1999, are now
fairly stable and may actually decrease in the second quarter. Our
outlook for the year 2000 remains very positive.
Busse continued, “Regarding other corporate developments, significant
operating progress was made during the first quarter at Iron Dynamics,
construction of the New Millennium Building Systems plant is on
schedule, and preparations continue for construction of the structural
mill planned for Whitley County, Indiana. Start-up costs associated with
Iron Dynamics, New Millennium Building Systems and the structural mill
were $6.1 million in the first quarter. Capital expenditures totaled
$29.2 million. The company achieved a financial milestone during the
quarter as total assets surpassed a billion dollars.”
Iron Dynamics, SDI’s wholly owned subsidiary, restarted production of
liquid pig iron in early January, and has provided, on a gradually
increasing basis, this scrap substitute product to SDI’s melt shop.
Production volume for the quarter was 21,000 tons. In the second quarter
IDI is expected to generate 20 to 25 thousand net tons and operate at
that rate until production is suspended late in the third quarter for
the planned retrofit of its submerged arc furnace. After completion of
this project late in the fourth quarter, the facility is expected to
ramp up steadily with the expectation of attaining full capacity by
mid-year 2001.
New Millennium Building Systems, SDI’s consolidated steel building
products investment, began construction of its first production facility
in DeKalb County, Indiana, north of the Steel Dynamics flat-roll mill.
This plant is expected to be completed and to begin production in the
second quarter of 2000.
No action has yet been announced by the EPA Environmental Appeals
Board to resolve a suit filed against the State of Indiana regarding the
issuance of a permit to allow construction on SDI’s planned structural
mill. This continues to be a source of frustration, particularly in
light of the permit having received thorough review by the State. SDI
believes the permit was properly issued. Extensive site preparations
have been completed, materials for construction have been delivered, and
much of the mill’s production equipment is on-site awaiting
installation. SDI is ready to begin construction of the mill on a
“fast-track” basis as soon as the legal issues are resolved.
Also in the first quarter, construction began on a corporate
headquarters building located west of Fort Wayne on a ten-acre tract of
land owned by the company. Corporate staff are expected to relocate
from leased offices to the new building in the fourth quarter of 2000. |