Steel Dynamics Reports Third Quarter 2024 Results

Financial Performance - Steel shipments for Q3 2024 were 3.2 million tons, with net sales of $4.3 billion, operating income of$395 million, and net income of $318 million [1] - Adjusted EBITDA for Q3 2024 was$557 million, with cash flow from operations of $760 million [1] - The company repurchased$310 million of its common stock, representing 1.6% of outstanding shares [1] - Net income for the first nine months of 2024 was $1.3 billion, a decline from$2.0 billion in the same period in 2023 [3] - Operating income for the first nine months of 2024 decreased by 35% to $1.7 billion compared to the same period in 2023 [3] Operational Highlights - The Sinton Texas Flat Roll Steel Mill operated at 72$166 million in Q3 2024, with steady demand and a 5% softening in average realized pricing [2] - The company's metals recycling operations saw a decline in operating income to $12 million in Q3 2024 due to softer demand and a$10 million unrealized copper hedging loss [2] - The company's steel operations realized a slight improvement in metal spread as scrap pricing declined more than average realized pricing [1] Market and Demand Outlook - Underlying steel demand remained stable in Q3 2024, with flat rolled steel prices stabilizing and improving later in the quarter [1] - The company expects steel pricing to recover in 2025 due to anticipated lower domestic interest rates, onshoring of manufacturing, and infrastructure investments [4] - The company's new value-added flat rolled steel coating lines are expected to contribute to earnings in 2025, with higher-margin products already representing over 65% of steel revenues [4] - The aluminum flat rolled products mill is expected to begin operations in mid-2025, targeting the sustainable beverage can and packaging industry, as well as automotive, industrial, and construction sectors [4] Capital Allocation and Investments - The company invested $621 million in internal growth initiatives in Q3 2024 and distributed$381 million to shareholders through dividends and share repurchases [1] - For the first nine months of 2024, the company invested $1.4 billion in capital investments and repurchased$917 million of its common stock, representing 4.5% of outstanding shares [3] - The company maintains strong liquidity of $3.1 billion as of September 30, 2024 [1] Segment Performance - Steel operations generated$305 million in operating income in Q3 2024, with average external product selling prices decreasing by $79 per ton sequentially to$1,059 per ton [2] - Steel fabrication operations achieved $166 million in operating income in Q3 2024, with steady demand and a 5$12 million in Q3 2024 due to softer demand and a $10 million unrealized copper hedging loss [2]