Nucor Benefits from Steel Tariffs, Price Increases -- Update

By Imani Moise 

Some U.S. steelmakers say their bottom lines are getting an early boost from tariffs the Trump administration recently implemented on imports of the metal from certain countries.

Nucor Corp. said Thursday margins from its steel mill operations were particularly strong in March, as the manufacturer benefited from price increases. The average sales price per ton of steel rose 9% for Nucor during the first quarter compared with the prior year.

Nucor, the largest U.S.-based steelmaker, also set a bullish outlook for the current quarter as the company prepares to compete in what it considers a more equal playing field.

"We are encouraged by recent actions by the government to address the massive flood of dumped and illegally subsidized imports into the United States," the company said in a statement.

Indiana-based Steel Dynamics Inc. said Wednesday it also sees demand and pricing growing throughout the year as a result of the tariff. The steel producer, which has facilities located in the U.S. and in Mexico, said price increases outpaced rising input costs in its most recent quarter.

Earlier this year, Nucor warned investors that sales growth might be offset by higher scrap prices, but the company said Thursday it now expects rising input costs to be passed on to customers after tariffs on imported steel and aluminum from countries excluding Canada and Mexico were implemented last month.

Nucor has been investing heavily to capitalize from a growing domestic metals market. Last month the company announced plans to build a $240 million rebar mill in Florida.

Overall for the quarter, the Charlotte, N.C.-based company reported a profit of $354.2 million, or $1.10 a share, down slightly from $356.9 million, or $1.11 a share, a year earlier.

Revenue jumped 15% to $5.56 billion.

Analysts polled by Thomson Reuters had forecast earnings of $1.10 a share on $5.46 billion in revenue.

Shares fell 1.7% to $64.34 in early trading. The stock has gained 1.2% so far this year while the S&P 500 has risen 0.9%.

Write to Imani Moise at [e-mail]

(END) Dow Jones Newswires

April 19, 2018 11:10 ET (15:10 GMT)

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