The nation's largest steelmaker blamed the disappointment on the high cost of scrap metal -- the primary feedstock at its mills -- and "the inability to pass along these price increases" to its customers, where business isn't strong enough to support such hikes.
Nucor expects to post third-quarter earnings of 5 cents to 10 cents a share. Analysts were expecting 31 cents.
Nucor, whose steel in large part goes into construction projects, continues to feel the impact of that moribund industry, the company said, reiterating sentences in its press release Tuesday that it's used since the onset of the recession. "As expected, the most challenging markets for our products continue to be those associated with residential and non-residential construction, which continue to show little, if any, strength."
The new financial guidance, Nucor said, includes an estimated charge of $67 million for last-in-first-out accounting, or LIFO, which the company uses to mark the value of its inventory of scrap. That's higher than the $45.5 million LIFO charge Nucor had earlier told Wall Street to expect.
When Nucor reported second-quarter results in July, it said that it saw a "general slowdown taking place across all product lines."
In its press release Tuesday, Nucor effectively said, "We told you so." "Our third quarter results will unfortunately confirm these concerns, and a general slowdown has indeed occurred from second quarter, particularly in our flat rolled business."
Investors sold off shares of the company in the early going Tuesday. The stock was changing hands recently at $39.19, down 3.6%.
-- Written by Scott Eden in New York
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