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Steel Dynamics Expects Profitable Second Quarter on Improvements in Flat Rolled Market
06/13/2016 - U.S.-based Steel Dynamics Inc. expects to nearly double its second-quarter profits over the first quarter due to better metal spreads and increased shipments, the company said on Monday.
In its second-quarter earnings guidance, the steelmaker said it expects to report earnings of between 53 to 57 cents per diluted share, largely on improvements in its flat rolled division.
“Customer flat roll inventory levels are better aligned with steady consumption. As such, the reduction in imported flat roll steel due to trade case actions has resulted in supply-driven price appreciation, especially for coated flat roll steel,” the company said in a statement.
It also said that its average realized mill price for the quarter is likely to increase about 10 percent, which will more than offset higher scrap costs. It said the heavy equipment, agricultural and energy sectors remain challenged, while the automotive sector remains strong and the construction market continues to improve.
“Customer flat roll inventory levels are better aligned with steady consumption. As such, the reduction in imported flat roll steel due to trade case actions has resulted in supply-driven price appreciation, especially for coated flat roll steel,” the company said in a statement.
It also said that its average realized mill price for the quarter is likely to increase about 10 percent, which will more than offset higher scrap costs. It said the heavy equipment, agricultural and energy sectors remain challenged, while the automotive sector remains strong and the construction market continues to improve.
