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Sep 30, 2022
Steel Dynamics Q3 2022 Earnings Report
Reported strong performance driven by diversified business model, with strength in steel fabrication offsetting lower earnings in flat rolled steel businesses.
Key Takeaways
Steel Dynamics reported strong Q3 2022 results with net sales of $5.7 billion and net income of $914 million, or $5.03 per diluted share. Excluding the impact from the company’s newly started Sinton Texas Flat Roll Steel Mill, adjusted net income was $992 million, or $5.46 per diluted share. The company achieved record quarterly steel shipments of 3.2 million tons.
Achieved record quarterly steel shipments of 3.2 million tons.
Consolidated operating income was $1.2 billion.
Adjusted EBITDA reached $1.3 billion.
Record cash flow from operations of $1.5 billion was achieved.
Steel Dynamics
Steel Dynamics
Steel Dynamics Revenue by Segment
Revenue by Segment
Steel Operations Revenue
CapyFin.comMetals Recycling Revenue
CapyFin.com Forward Guidance
Customer order entry activity continues to be healthy across our businesses, with expectations for seasonally moderated volume for our steel and metals recycling operations in the coming months. The Sinton team has been running at a rate of 65 percent during October and achieving rates of over 80 percent for several single day periods, supporting our expectations to achieve a run rate of at least 80 percent for the full year 2023.
Positive Outlook
- Customer order entry activity continues to be healthy across our businesses.
- Order activity and backlogs remain solid despite weaker flat rolled steel pricing.
- North American steel consumption will remain steady.
- Demand for lower-carbon, U.S. produced steel products coupled with lower imports will support steel pricing.
- Steel fabrication operations order backlog also remains historically high based on volume and forward pricing levels.
Challenges Ahead
- Expectations for seasonally moderated volume for our steel and metals recycling operations in the coming months.
- Weaker flat rolled steel pricing.
- Ferrous scrap pricing indices have decreased each month beginning in May and continued through October 2022, resulting in significantly lower earnings from our metals recycling operations.
- Third quarter operating income for the company’s steel operations was 41 percent lower than sequential second quarter results, due to metal spread compression within the company’s flat rolled steel operations, as lower average flat rolled steel pricing more than offset higher flat rolled steel shipments.
- Operations continue to ramp up at our Sinton Flat Roll Steel Division.
Revenue & Expenses
Visualization of income flow from segment revenue to net income