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Nucor Warns on Profits

Third-quarter earnings will probably miss estimates.
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Nucor

(NUE) - Get Report

said its third-quarter earnings will likely fall short of analysts' estimates because of continued softness in the sheet steel markets and the increasing costs of some raw materials.

Shares fell 3.2% to $51.81 in premarket trading.

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For the quarter ending Sept. 29, Nucor expects a profit of $1.10 to $1.15 a share. On average, analysts are looking for $1.27. Nucor, a steelmaker, earned $1.14 a share in the second quarter and $1.70 in the year-ago third quarter.

The sheet market has suffered from lackluster demand in the automotive and residential construction markets, including appliances and HVAC, Charlotte-based Nucor said Wednesday.

"On the supply side, while the latest data suggests a strong slowing of imports in August, stubbornly high imports through the first seven months, particularly from China, continue to impact both pricing in the marketplace and customer inventories," the company said. "While both imports and inventories are down significantly from their peaks, they did not fall far enough during the end of the second quarter and through the midpoint of the third quarter to support improving pricing opportunities during the third quarter."

However, Nucor said price realizations on sheet should improve during the fourth quarter and hold their ground on most other mill products. The possible exception is bar products.