Nucor Projects Disappointing Second Quarter Earnings

By Chelsey Dulaney 

Nucor Corp. said Thursday that its second-quarter earnings will likely fall well below Wall Street expectations, as its steel business continues to feel pricing pressures.

Shares, down 7.4% the last year, fell 2.4% in premarket trading.

The Charlotte, N.C., steelmaker said it expects to post per-share earnings of 20 cents to 25 cents, while analysts polled by Thomson Reuters had recently expected earnings of 31 cents a share. The quarter will end July 4.

In the prior-year period, Nucor posted per-share earnings of 46 cents.

Nucor said pricing has started to stabilize in its steel mills segment, but margins eroded as a drop in selling prices outpaced a drop in raw material costs.

The company said pricing pressures remain as imports continue to flood the market.

Meanwhile, Nucor said improvements in nonresidential construction markets should help its downstream segment in the quarter.

In January, Nucor said it planned to reduce production to support prices, which were at their lowest levels in five years. The company's pipe-and-tube segment has also been hurt by competition from imports and low crude-oil prices, which have led exploration-and-production companies to rein in spending.

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