Steel Dynamics Inc. released its second-quarter 2023 financial results, reporting net sales of USD 5.1 billion and net income of USD 812 mln for the quarter. Compared to the preceding first quarter of 2023, net income showed significant improvement, rising from USD 637 mln to USD 812 mln. However, the current net income is lower than the second quarter of the previous year, which reported USD 1.2 billion.
Mark D. Millett, Chairman, and Chief Executive Officer attributed the sequential improvement in earnings to higher realized pricing from their steel operations. The company continues to experience robust steel order activity from various sectors, including automotive, construction, industrial, and energy. Positive data from the steel service center sector indicates continued low customer inventory levels, suggesting a rebound in demand and supporting steel pricing.
For the first six months of 2023, Steel Dynamics reported a net income of USD 1.4 billion and net sales of USD 10 billion. Comparatively, the same period in the previous year registered a net income of USD 2.3 billion and net sales of USD 11.8 billion, representing a decrease of 15 pct YoY in net sales. The decline in earnings was primarily driven by a metal spread contraction within the company’s steel operations, with lower realized product pricing outweighing the decrease in ferrous scrap costs.
Despite these challenges, Millett expressed confidence in the domestic steel consumption outlook, expecting solid growth in North American steel consumption in the coming years. The company anticipates increased demand for lower-carbon emission, U.S.-produced steel products, along with reduced steel imports, supporting favorable steel pricing.
Steel Dynamics is one of the largest domestic steel producers and metals recyclers in the United States, based on estimated annual steelmaking and metals recycling capability, with facilities located throughout the United States, and in Mexico. Steel Dynamics produces steel products, including hot roll, cold roll, and coated sheet steel, structural steel beams and shapes, rail, engineered special-bar-quality steel, cold finished steel, merchant bar products, specialty steel sections and steel joists and deck. In addition, the company produces liquid pig iron and processes and sells ferrous and nonferrous scrap.
