Steel Dynamics Inc. expects its earnings in the third quarter to range between 66 US cents to 70 cents per diluted share, down from US$1.69 per share in the year-ago quarter and 87 cents per share in the second quarter this year.
The company said Sept. 17 that its earnings are expected to decline compared with the second quarter due to lower profitability from the sheet steel operations because of lower shipments and average steel pricing, which more than offset lower scrap costs.
Steel Dynamics' metals recycling platform is also expected to record weak results due to declining ferrous and nonferrous commodity prices.
The decline will be somewhat cushioned by an improvement in earnings of the steel fabrication business on the back of higher shipments and steady metal spread.
Steel Dynamics noted that it has order backlogs for steel fabrication and customers are optimistic about the nonresidential construction projects.
The company's second-quarter attributable net income slumped 46.4% year over year to US$194.3 million, or 87 cents per share, due to a challenging steel pricing environment.
Average external sales price during the period dropped to US$879 per tonne, from US$932 per tonne in the year-ago quarter and US$902 per tonne in the first quarter.
