Steel Dynamics Sees Weak Q3 Earnings Below Market

(RTTNews) - Steel producer Steel Dynamics Inc. (STLD) Monday issued third-quarter earnings outlook, expecting significantly lower earnings than last year, and below market estimates. The company also projects sequentially lower earnings in the quarter.

For the third quarter, the company expects earnings in the range of $3.46 to $3.50 per share, compared to prior year's $5.03 per share. In the sequential second quarter, earnings were $4.81 per share.

On average, seven analysts polled by Thomson Reuters expect earnings of $3.73 per share for the quarter. Analysts' estimates typically exclude special items.

According to the company, profitability from the company's steel operations is expected to be significantly lower sequentially, based on metal spread contraction as lower realized flat rolled steel pricing more than offset lower scrap costs.

Meanwhile, steel shipments would be comparable to sequential second quarter volume, excluding lost volume related to Sinton's unplanned July outage. Steel order activity remains solid.

In the quarter, earnings from metals recycling operations would be lower sequentially due to lower volume and metal spread compression as pricing declined throughout the quarter.

Earnings from steel fabrication operations are also expected to be lower compared to sequential second results.

In pre-market activity on Nasdaq, Steel Dynamics shares were losing around 1.23 percent to trade at $97.50.