While still expecting to reach the black for Q3 2011, Nucor's guidance for the quarter released Thursday indicated that profits will fall below Q2 2011 levels. In the release, Nucor said it expects third quarter results to be in the range of $0.45-$0.55 per diluted share, which represents an approximate 40-50 percent decrease from second quarter earnings of $0.94 per diluted share. However, projected Q3 earnings would still be a 540-690 percent increase over Q3 2010 earnings of $0.07 per diluted share.
The statement admitted that Nucor expected profitability to deteriorate quarter-on-quarter, reflecting "lower steel prices and metal margins, particularly for sheet mill products, due to new domestic supply, increased imports and continued high raw material costs." On the positive side, scrap prices remained stable during the quarter, and "end markets such as automotive, heavy equipment, energy and general manufacturing have continued to experience some real demand improvement, benefiting special bar quality, sheet and plate products." Additionally, the company expects continued stability in order rates, as "raw material prices have been less volatile than in 2010, and our customers continue to operate with minimal inventories."