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Nucor (NUE) John J. Ferriola on Q1 2016 Results - Earnings Call Transcript

Q1 2016 Earnings Call

April 21, 2016 2:00 pm ET

Executives

John J. Ferriola - Chairman, President & Chief Executive Officer

James D. Frias - Chief Financial Officer, Treasurer & Executive VP

David A. Sumoski - Executive Vice President-Engineered Bar Products, Nucor Corp.

R. Joseph Stratman - Executive Vice President

Analysts

Evan L. Kurtz - Morgan Stanley & Co. LLC

Garrett Scott Nelson - BB&T Capital Markets

Philip N. Gibbs - KeyBanc Capital Markets, Inc.

Matthew J. Korn - Barclays Capital, Inc.

Jorge M. Beristain - Deutsche Bank Securities, Inc.

Timna Beth Tanners - Bank of America Merrill Lynch

Operator

Good day, everyone, and welcome to the Nucor Corporation first quarter of 2016 earnings call. As a reminder, today's call is being recorded. Later, we will conduct a question-and-answer session, and instructions will come at that time.

Certain statements made during this conference call will be forward-looking statements that involve risks and uncertainties. The words we expect, believe, anticipate and variations of such words and similar expressions are intended to identify those forward-looking statements, which are based on management's current expectations and information that is currently available. Although Nucor believes they are based on reasonable assumptions, there can be no assurance that future events will not affect their accuracy.

More information about the risks and uncertainties relating to these forward-looking statements may be found in Nucor's latest 10-K and subsequently filed 10-Qs, which are available on the SEC's and Nucor's website. The forward-looking statements made in this conference call, only speak only as of this date, and Nucor does not assume any obligation to update them, either as a result of new information, future events or otherwise.

For opening remarks and introductions, I would like to turn the call over to Mr. John Ferriola, Chairman, Chief Executive Officer and President of Nucor Corporation. Please go ahead, sir.

John J. Ferriola - Chairman, President & Chief Executive Officer

Good afternoon. Thank you for joining us for our conference call. We appreciate your interest in Nucor. With me for today's call are the other members of Nucor's senior management team: Chief Financial Officer, Jim Frias; and our other Executive Vice Presidents, Jim Darsey; Ladd Hall; Ray Napolitan; Joe Stratman; Dave Sumoski and Chad Utermark.

Our leadership team in Charlotte would like to thank everyone on our Nucor, Harris Steel, David J. Joseph, Duferdofin, NuMit, Steel Technologies, and Skyline Steel teams for your continued success in building a safer, stronger and more profitable Nucor. You are positioning Nucor to continue to thrive in the years ahead.

CFO, Jim Frias will now review Nucor's first quarter performance and financial position. Following his comments, I will update you on the ongoing execution of our strategy for long-term profitable growth. Jim?

James D. Frias - Chief Financial Officer, Treasurer & Executive VP

Thanks John. First quarter 2016 earnings of $0.22 per diluted share were within our guidance range of $0.20 to $0.25 per diluted share. First quarter results included a LIFO charge of $27.5 million or about $0.02 per share higher than projected in our guidance. Excluding the impact of LIFO inventory accounting, the first quarter's performance represented an improvement over the fourth quarter of 2015's adjusted net earnings of $0.45 per diluted share, which included a LIFO credit of $0.41 per share.

Market conditions remain challenging during the first quarter but are now improving. Reflecting the impact of the 2014 to 2015 import surge, average steel mill prices and metal margins declined in the first quarter from already weak fourth quarter levels. However, imports have begun to subside, and steel mill pricing and metal margins improved notably by the end of the quarter.