Slide 1: Fourth Quarter and Full Year 2022 Earnings Call
FOURTH QUARTER AND FULL YEAR 2022 EARNINGS CALL LEON TOPALIAN Chair, President and CEO STEVE LAXTON Executive Vice President and CFO January 26, 2023
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS Certain statements made in this presentation may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties. The words “anticipate,” “believe,” “expect,” “intend,” “may,
Slide 3: Non-GAAP Financial Measures
NON-GAAP FINANCIAL MEASURES The Company uses certain non-GAAP (Generally Accepted Accounting Principles) financial measures in this presentation, including EBITDA and free cash flow. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance or financial position that
Slide 4: 2022 Key Accomplishments & Highlights
2022 KEY ACCOMPLISHMENTS & HIGHLIGHTS INDUSTRY-LEADING SAFETY RECORD • Fourth consecutive year setting new record low injury/illness rate • Record safety results across all four primary metrics we track • 20 Nucor divisions with zero recordable injuries in 2022 MOST PROFITABLE YEAR IN NUCOR HISTORY
Slide 5: Advancing Our Mission
ADVANCING OUR MISSION Continuing to execute the Company’s three-part mission, and becoming a more diversified, efficient, industrial manufacturer of value-added steel products MISSION STRATEGIC RATIONALE & ACTION PLANS • Shifting mix to higher margin, value-added end products GROW THE • Building on
Slide 6: Growing the Core
GROWING THE CORE PLATE SHEET BAR Completed Brandenburg Adding more finishing Announced third rebar plate mill project on-time capabilities and leveraging micro mill to be built in and on-budget our sustainability advantage Lexington, NC ✓ Rolled first steel plate on ✓ West Virginia – lower carbon ✓
Slide 7: Expanding Beyond
EXPANDING BEYOND OVERHEAD TOWERS & INSULATED METAL WAREHOUSE DOORS STRUCTURES PANELS RACKING SYSTEMS • Initial phase of • Announced plans to • Completing integration • Completed two realizing synergies construct two highly- of Cornerstone after acquisitions between with C.H.I. automated tower closin
Slide 8: Constructive Macro Backdrop for Steel
CONSTRUCTIVE MACRO BACKDROP FOR STEEL INFRASTRUCTURE RESHORING GREEN ECONOMY • Infrastructure Investment & • CHIPS and Science Act • Inflation Reduction Act Jobs Act adds $550 billion provides ~$55 billion of includes ~$370 billion of tax infrastructure spending over incentives to reshore incentives
Slide 9: Two Consecutive Years of Record-Setting Cash Flow and Earnings
TWO CONSECUTIVE YEARS OF RECORD-SETTING CASH FLOW AND EARNINGS $ per share ($ in millions) $14,000 35.00 5-Yr CASH FLOW & EARNINGS HISTORY 2018-2022 $12,000 30.00 • $24.2 billion Operating Cash Flow • $16.6 billion Free Cash Flow1 $10,000 25.00 • $18.8 billion Net Earnings • $9.7 billion returned to
Slide 10: Q4 2022 Segment Results
Q4 2022 SEGMENT RESULTS ($ in millions) STEEL MILLS SEGMENT % Change Versus • Lower shipments reflecting caution among service Q4 '22 Q3 '22 Q4 '21 Prior Qtr Prior Year centers and other customers, and seasonality • Lower pricing and lower scrap costs with net effect Shipments (000s tons) 5,110 5,85
Slide 11: 2023 Estimated Capex: ~$3.0 Billion
2023 ESTIMATED CAPEX: ~$3.0 BILLION ENVIRONMENTAL CAPITAL SPARES OTHER Approximately 2/3 SAFETY of CAPEX allocated to profitable growth COST projects SAVING IMPROVED PRODUCT MAINTENANCE CAPABILITES & EXPANSION 11
Slide 12: Near Term Capex: Major Projects
NEAR TERM CAPEX: MAJOR PROJECTS ($ in millions) $2,500 ~$2.3 billion $2,000 ~$1.6 billion WEST VIRGINIA SHEET MILL $1,500 1,425 WEST VIRGINIA SHEET MILL 800 $1,000 AIR SEPARATION UNITS 185 AIR SEPARATION UNITS 160 BERKELEY GALV LINE 100 BERKELEY GALV LINE 270 $500 CSI GALV LINE 190 CSI GALV LINE 150
Slide 13: Strategic Investments Producing Results
STRATEGIC INVESTMENTS PRODUCING RESULTS Sheet Investments Completed Investment1 Expand Beyond Investments Completed Investment1 Gallatin Galvanizing Line 2020 $200 Insulated Metal Panels 2021 $1,100 Arkansas Cold Mill 2020 $245 Nucor Warehouse Systems 2021/2022 $445 CSI Acquisition 2022 $408 C.H.I.
Slide 14: Maintaining a Strong Balance Sheet
MAINTAINING A STRONG BALANCE SHEET US $ in millions x2022 • Committed to strong investment grade ratings as of December 31, 2022 Amount EBITDA1 % cap • Initial Fitch rating of “A-” published Jan 24th $1.75Bn Revolving Credit Facility $0 • Nucor sr. unsecured corporate credit ratings: Senior Notes Ou
Slide 15: Returning Capital to Shareholders
RETURNING CAPITAL TO SHAREHOLDERS ANNUAL DIVIDEND PER SHARE(1) SHARES OUTSTANDING (MILLIONS) $2.50 340 DIVIDEND KING 320 $2.00 50 consecutive years of dividend increases 300 ~20% Reduction $1.50 280 $1.00 260 240 $0.50 220 $0.00 200 2017 2018 2019 2020 2021 Q1 Q2 Q3 Q4 '22 '22 '22 '22 Committed to a
Slide 16: Q1 2023 Earnings Outlook
Q1 2023 EARNINGS OUTLOOK OUTLOOK VARIANCE SEGMENT EXPECTATIONS FOR Q1 2023 TO Q4 2022 • Improved profitability on higher volumes Steel Mills and improved margins • Healthy margins expected to continue Steel Products • Lower earnings than Q4’22 but higher than Q1’22 due to seasonality and some reduct
Slide 17: 2023 Domestic End Use Market Outlook
2023 DOMESTIC END USE MARKET OUTLOOK End Use Market Outlook Comments on Expected 2023 Outook • Manufacturing, data centers and healthcare expected to show strength • Non-res building starts expected to be strong vs pre-pandemic levels, Non-residential but down slightly year-over-year due to a declin
Slide 18: Appendix
APPENDIX NuUcoRF
Slide 19: Reconciliation of GAAP to Non-GAAP Measure
RECONCILIATION OF GAAP TO NON-GAAP MEASURE $ in millions 2018 2019 2020 2021 2022 NET EARNINGS1 2,481 1,371 836 7,122 8,080 NET INTEREST EXPENSE 136 121 153 159 170 PROVISION FOR INCOME TAXES 748 412 -- 2,078 2,165 DEPRECIATION EXPENSE 631 649 702 735 827 AMORTIZATION EXPENSE 89 86 83 136 235 IMPAIR
Slide 20: Reconciliation of GAAP to Non-GAAP Measure
RECONCILIATION OF GAAP TO NON-GAAP MEASURE $ in millions 5 Year 2018 2019 2020 2021 2022 Totals CASH PROVIDED BY OPERATING ACTIVITIES 2,394 2,809 2,697 6,231 10,072 24,203 CAPITAL EXPENDITURES (983) (1,477) (1,543) (1,622) (1,948) (7,573) FREE CASH FLOW 1,411 1,332 1,154 4,609 8,124 16,630 20
Slide 21: Segment Results: Steel Mills and Steel Products
SEGMENT RESULTS: STEEL MILLS AND STEEL PRODUCTS STEEL MILLS % Change Versus • Lower shipments reflecting caution among Shipments (tons in thousands) Q4 '22 Q3 '22 Q4 '21 Prior Qtr. Prior Year service centers and other customers, as Sheet 2,314 2,667 2,502 -13% -8% well as seasonality Bars 1,907 2,16
Slide 22: Segment Results: Raw Materials
SEGMENT RESULTS: RAW MATERIALS RAW MATERIALS % Change Versus Shipments (tons in thousands) Q4 '22 Q3 '22 Q4 '21 Prior Qtr. Prior Year • Loss for the quarter on lower prices and DRI 613 977 1,000 -37% -39% volumes. Scrap Processing 974 1,088 1,190 -10% -18% • Maintenance outages at DRI operations Tot
Slide 23: Quarterly Sales and Earnings Data
QUARTERLY SALES AND EARNINGS DATA SALES TONS (THOUSANDS) TO OUTSIDE CUSTOMERS EARNINGS (LOSS) BEFORE STEEL STEEL PRODUCTS INCOME COMP. TAXES SALES OTHER TOTAL PRICE TOTAL STEEL STEEL COLD REBAR TUBULAR STEEL STEEL RAW TOTAL NET SALES PER PER YEAR SHEET BARS BEAMS PLATE STEEL JOISTS DECK FINISH FAB P
Slide 24: Quarterly Sales Prices & Scrap Cost
QUARTERLY SALES PRICES & SCRAP COST STEEL MILLS AVERAGE SCRAP AND SCRAP AVG TOTAL SUBSTITUTE COST EXTERNAL STEEL SALES PRICE TOTAL SHEET BARS BEAMS PLATE PRODUCTS PER GROSS PER NET PER NET TON STEEL TON USED TON USED 2022 2022 1st Quarter 1,571 1,140 1,496 1,861 1,436 2,689 1st Quarter 495 442 2nd Q
Slide 25: Safety Metrics
SAFETY METRICS REDUCTION IN INJURY & ILLNESS RATES Annual OSHA Recordables per 200,000 hours/year 1.94 1.80 1.63 1.66 1.55 1.48 1.30 1.10 1.04 0.95 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 25
Slide 26: Sustainability Leadership
SUSTAINABILITY LEADERSHIP SCOPE 1 & 2 GHG INTENSITIES VS. SCOPE 1, 2 & 3 INTENSITY PARIS AGREEMENT TARGETS (metric tons of CO2e per metric ton of steel produced) 2.5 Integrated (BF-BOF) average: 2.21 1.89 0.79 2.0 Global steelmaking average: 1.76 1.5 1.0 0.5 Nucor 0.43 Nucor Advantage 0.0 OVERALL NU
Slide 27: From an Advantaged Starting Point Nucor Is Setting Ambitious Goals
FROM AN ADVANTAGED STARTING POINT NUCOR IS SETTING AMBITIOUS GOALS 35% Reduction by 2030 1 Nucor committed to an additional 35% combined reduction in our Scope 1 and Scope 2 GHG Intensity by 2030 (2015 baseline) Transparency 2 Nucor values transparency and will continue to publicly disclose and redu
Slide 28: Nucor Is Shaping Its Sustainability Strategy Through Innovation
NUCOR IS SHAPING ITS SUSTAINABILITY STRATEGY THROUGH INNOVATION Carbon Capture BioCarbon Green Pig Emissions Zero & Storage Iron (“CCS”) Free Power Emission Iron Biocarbon can be Green pig iron can Working on a Supporting Evaluating two produced from be produced from CCS opportunity greening of powe