Steel Dynamics, Inc. reported first quarter 2023 net sales of $4.9 billion and net income of $637 million. Comparatively, the company's sequential fourth quarter 2022 earnings were $635 million on sales of $4.8 billion, while Q1 2022 earnings totaled $1.1 billion on sales of $5.6 billion.
In a press release, the company said first quarter 2023 operating income for the company's steel operations was $345 million, or 93 percent higher than sequential fourth quarter results, due to increased demand resulting in record first quarter steel shipments of 3.3 million tons, partially offset by metal spread compression resulting from lower realized selling values associated with lagging indexed-contracts within the flat rolled operations.
First quarter operating income from the company's metals recycling operations increased significantly to $43 million, based on increased demand supporting higher volumes and product pricing for both ferrous and nonferrous materials, the company said.
Domestic steel production utilization increased from 73 percent in the sequential fourth quarter to 75 percent in the first quarter 2023.
The company's steel fabrication operations achieved historically very strong operating income of $551 million in the first quarter 2023, but below record fourth quarter results, based on seasonally lower shipments coupled with steady metal spread.
As for an outlook, Mark D. Millett, Chairman and CEO, said, "We remain confident that market conditions are in place for domestic steel consumption to be solid. Order entry activity continues to be strong across all of our businesses. We believe North American steel consumption will increase in 2023, and that demand for lower-carbon emission, U.S. produced steel products coupled with lower imports will support steel pricing. We believe the automotive, non-residential construction, and energy sectors will remain solid steel consumers this year. Our steel fabrication operations order backlog remains elevated with strong forward pricing levels. The combination of robust order activity and broad customer optimism supports strong overall demand dynamics for the construction industry. This environment, in combination with our existing and recently announced expansion initiatives, are firm drivers for our continued growth in the coming years.”