SEATTLE (Scrap Monster): Steel Dynamics Inc. provided earnings guidance for second quarter of the current year. The Fort Wayne, Indiana-based company guided Q2 earnings in the range of $0.29 to $0.33 per diluted share. The projected Q2 earnings are significantly lower when compared with robust Q1 2020 earnings, but are tremendous given the difficult circumstances.
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The company forecasts impact on account of additional financing costs related to refinancing activities of approximately $25b million. Also, the earnings are likely to take a hit of start-up-costs associated with the construction of Sinton Texas flat rolled steel mill of nearly $10 million. Excluding the impacts from the above items, the adjusted earnings are likely to range between $0.40 and $0.44 per diluted share, the company news release said.
The lower shipments and selling prices are likely to result in significantly lower earnings from the company’s steel operations in Q2 in comparison with the sequential quarter. The construction related steel demand continued to remain steady. The scrap collection and supply declined during the quarter. As a result, the company’s metals recycling segment is expected to record operating loss.
Mark D. Millett, President and Chief Executive Officer congratulated the operating, commercial, and financial teams in coming together to deliver strong quarterly results.
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