- Steel Dynamics Inc STLD shares are gaining around 8% today, following its mixed bag of first-quarter 2023 results. The company remains confident that market conditions are in place for solid domestic steel consumption.
- STLD reported Q1 revenues of $4.89 billion, down 12% Y/Y, missing the consensus of $5.00 billion.
- The company reported a record shipment of 3.3 million tons in Q1 versus 2.9 million tons a year ago.
- Operating income declined to $835.4 million in Q1 from $1.49 billion a year ago due to a significant Y/Y decline in operating income from Steel operations.
- Operating income from Steel operations was impacted by higher metal spread compression (up around $50 million) due to increased raw material costs, given the deployment of the remaining higher-priced pig iron ordered in early 2022 on the Ukraine and Russia supply-chain disruptions.
- Operating income from Steel Fabrication business rose to $551.3 million from $466.9 million a year ago on solid order entry from non-residential construction sector.
- Adjusted EPS of $4.01 came above the consensus of $3.52.
- Cash flow from operations stood at $733.8 million as of March 31, 2023.
- Steel Dynamics repurchased shares worth $354 million in Q1.
- The company witnessed operations ramp up at its newly started Sinton Flat Roll Steel Division and expects 2023 shipments to be around 80% of the plant's annual capacity.
- "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," said Mark D. Millett, Chairman and CEO.
- He further added, "We are pleased to further diversify our end markets with plans to supply aluminum flat rolled products with high recycled content to the countercyclical sustainable beverage can industry, in addition to the automotive and industrial sectors."
- Price Action: STLD shares are trading higher by 7.97% at $114.69 on the last check Thursday.
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