On Thursday, Nucor Corporation reported that in Q2 2013, the company reported net earnings of $85.1 million, up from $84.8 million in Q1 but down from $112.3 million in Q2 2012. During Q2 2013, sales rose 3 percent to $4.67 billion, but were down 8 percent from $5.1 billion in Q2 2012. Similarly, the average sales price per ton increased slightly from Q1 2013 but was down 7 percent from Q2 2012.
For the first half of 2013, Nucor's earnings were $169.9 million, a substantial decrease from $257.4 million in the first half of last year. Also in the first half of 2013, net sales fell 9 percent and total tons shipped to outside customers decreased 3 percent, while average sales prices per ton dropped by 7 percent.
Due to weakness in the sheet market, operating performance at Nucor's mills was down compared to Q1. The company said that it expects to see a modest improvement in earnings for Q3 2013, due to improvements in sheet steel pricing, which dropped to its lowest level since November 2010 in June but has since begun to slowly rebound. Sheet prices are up for a number of reasons, particularly labor and production issues that took some capacity temporarily out of the market.
On the longs side, Nucor executives explained that the rebar market, and rebar fabrication market has been challenged, although business in Canada is strong. Weather had the most significant impact on the drop in Nucor's rebar fabrication shipments in Q2. Shipments have been behind but projects are now beginning to "break loose.
Overall, market conditions remain "frustratingly challenging," according to Nucor's President and CEO John Ferriola.