Nucor Corporation · NYSE:NUE
Nucor — Investor Presentation (November 2021)
32 slides from Nucor's investor presentation, November 2021
Slide 1: November 2021 Brandenburg Plate Mill
NOVEMBER 2021 BRANDENBURG PLATE MILL
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS Certain statements made in this presentation are forward-looking statements that involve risks and uncertainties. The words “believe,” “expect,” “project,” “will,” “should,” “could” and similar expressions are intended to identify those forward-looking statements. These fo
Slide 3: Nucor Overview
NUCOR OVERVIEW 9 Months Results 2018 2019 2020 2021 • North America’s largest & most Net Sales $25B $23B $20B $26B diversified steel & steel products Steel Mills 24.9M 23.4M 22.7M 19.8M company Shipments Tons Tons Tons Tons • 25 scrap-based steel mills with annual EPS $7.42 $4.14 $2.36 $15.34 produc
Slide 4: Q3-2021 Recap
Q3-2021 RECAP • Record quarterly net income of $2.1 billion and diluted EPS of $7.28 • Record First Nine Months of 2021 net income of $4.6 billion and diluted EPS of $15.34 – more than double full year diluted EPS record of $7.42 set in 2018 • Completed growth projects’ performance exceeding expecta
Slide 5: Our Strengths
OUR STRENGTHS • Nucor's Culture • Market Leadership Positions • Diversified Product Portfolio • Low & Highly Variable Cost Structure • Strong Cash Generation Through The Cycle • Strong Balance Sheet 5
Slide 6: Principles of Nucor's Culture
PRINCIPLES OF NUCOR’S CULTURE Safety First Trust Open Communication Community Teamwork Results Stewardship 6
Slide 7: Safety – Our First Priority
7 10 12 0 4 6 2 8 1996 10.00 1997 9.30 1998 9.00 1999 7.52 2000 7.24 2001 6.12 2002 5.11 2003 4.08 2004 3.83 2005 3.40 2006 2.54 2007 2.15 2008 2.04 2009 2.73 2010 2.29 2011 2.02 2012 1.82 SAFETY – OUR FIRST PRIORITY 2013 1.94 2014 1.80 2015 1.63 NUCOR INJURY & ILLNESS RATES 1996-2020 2016 1.48 Whil
Slide 8: Market Leadership
MARKET LEADERSHIP Structural Steel Steel Piling Distribution #1 Merchant Bar Steel Metal Buildings North American Cold Finish Bar Steel Steel Electrical Conduit Pipe Market Steel Joist & Deck Insulated Metal Panels (IMP) #2 Rebar Steel & Fab Plate Steel Hollow Structural Section (HSS) Steel Tubing N
Slide 9: Diversified Product Mix
DIVERSIFIED PRODUCT MIX 2020 Volumes Sold to Growing Steel Outside Customers Products Portfolio Bar Structural 23% 8% Plate 7% Sheet Steel 33% Products 19% Raw materials 10% 2020 Total Sales Volume 25.5 Million tons 9
Slide 10: Low, Highly-Variable Cost Structure
LOW, HIGHLY-VARIABLE COST STRUCTURE $1,200 Sustainable Profitability / Highly Variable Cost Structure / Stable Metal Spread $1,000 U.S. Dollars per ton $800 $655 $600 $456 $434 $400 $393 $388 $375 $359 $369 $381 $338 $356 $353 $200 $0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 9 Mos '21
Slide 11: Strong Balance Sheet
STRONG BALANCE SHEET Low Financial Leverage $6.0 30% $5.0 26.4% 25% 22.6% $4.0 21.7% 20% Billions of U.S. Dollars 20.0% 19.2% 17.1% 16.8% $3.0 16.5% 15% 12.8% $2.0 10% $1.0 5% $0.0 0% 2013 2014 2015 2016 2017 2018 2019 2020 9 Mos '21 Debt Cash Net Debt / Capital 11
Slide 12: Ample Financial Flexibility
AMPLE FINANCIAL FLEXIBILITY Operating Cash Flow Net Income Current liquidity of $2.3* $3.0 billion in cash and an Strong Cash Generation Through the Cycle undrawn $1.5 billion $2.5 credit facility maturing in 2023 $2.0 Billions of U.S. Dollars No material debt maturities $1.5 until Q3 2022 $1.0 Stro
Slide 13: Looking Ahead
LOOKING AHEAD NUoCorF,
Slide 14: Enhanced Environmental Stewardship
ENHANCED ENVIRONMENTAL STEWARDSHIP Nucor’s greenhouse gas emissions intensity is less than one-third the global average Nucor is leveraging renewable power to further reduce its GHG intensity RECYCLED Nucor’s products are enabling CONTENT the transformation of the 71.4% electrical grid and the The r
Slide 15: GHG Reduction Strategy – Nucor Steel Mills
GHG REDUCTION STRATEGY – NUCOR STEEL MILLS Nucor’s GHG intensity today is already nearly 50% below the most aggressive Paris Climate Scope 1 0.22 1 Agreement GHG reduction targets for our sector and more than 75% below the GHG Scope 3 2020 Nucor intensity of most integrated steelmakers.1 0.36 Steelm
Slide 16: Imports' Market Share Reduced
IMPORTS’ MARKET SHARE REDUCED Imports’ Share of U.S. Finished Steel Market 30% 29% 28% 28% 27% 26% 26% 24% 24% 23% 23% 22% 22% 21% 21% 21% 19% 20% Lowest annual import 18% market share 18% since 2003 16% 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 16 Source: AISI
Slide 17: Evolving Sheet Steel Supply Landscape
EVOLVING SHEET STEEL SUPPLY LANDSCAPE Sheet Mills Capacity U.S. & Canada Raw Steel Capacity 80 Top 4 producers now Cold-Idled ('13-'20) -11 account for approximately Hot-Idled ('19-'20) -23.1 70% of the domestic supply Re-Started ('20 - '21) 19.5 2021 Current Capacity 65.4 SDI (Sinton - 2021) 3 In 2
Slide 18: Capital Allocation Priorities
CAPITAL ALLOCATION PRIORITIES 1. Investing In 2. Base Dividend 3. Share Profitable Growth Repurchases or Growth Commensurate Supplemental Opportunities With Earnings Dividends We expect to return a minimum of 40% of our earnings to shareholders, while maintaining our strong investment grade credit p
Slide 19: $6.1 Billion Returned – Year Period Ended 2020
$6.1 BILLION RETURNED – 10 YEAR PERIOD ENDED 2020 69% of 2011-2020 Net Income Returned To Shareholders $1,400 120% $1,200 100% $1,000 Millions of U.S. Dollars 80% $800 60% $600 40% $400 20% $200 $0 0% 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Dividends Repurchases Payout Ratio 19
Slide 20: Strategic Growth Program Continues
STRATEGIC GROWTH PROGRAM CONTINUES Value Added Steelmaking Adjacencies Processing Midwest Sheet Mill 2.3 Million tons of New Industry leading insulated Expanded product capabilities in under- Galvanizing Capability metal panels (IMP) represented region Significantly lower carbon footprint than Consi
Slide 21: Nucor's Sheet Mill Group
NUCOR’S SHEET MILL GROUP A portfolio of targeted capabilities Nucor Steel Gallatin Thicker Slab Nucor Steel Indiana 72” Hot Band Pickle Galvanizing Line 55” HR Width for Construction Grades Heavy Gauge Applications for Heavy Equipment, Energy Pipe, Auto New Midwest Mill Thicker slab 84” HR Width 76”
Slide 22: Growth Investments – Sheet Mills
GROWTH INVESTMENTS – SHEET MILLS Budgeted Amount Project Startup (millions of $USD) Gallatin, KY Hot Band Capacity Expansion Late • Expands annual capacity by 1.4 million tons to 3.0 mm tons $650 2021 • Expanded capabilities to supply heavier gauge, wider coils Arkansas Gen 3 Flex Galvanizing Line •
Slide 23: Gallatin, Kentucky Projects
GALLATIN, KENTUCKY PROJECTS Brownfield Investments Aimed at Enhanced Competitiveness in the Heart of the Flat Rolled Market • Hot band galvanizing line o Widest in North America o Capability to serve growing automotive applications • Cost effective modernization and doubling of capacity o Increases
Slide 24: Hickman, Arkansas Projects
HICKMAN, ARKANSAS PROJECTS Cold Mill Expansion • Adding a specialty cold rolling complex, utilizing existing melt capacity • Expands Nucor’s capability to produce Motor Lamination (ML), High Strength Low Alloy (HSLA), & Advance High Strength Steel (AHSS) products • Flexible cold reduction mill will
Slide 25: Midwest Sheet Mill
MIDWEST SHEET MILL New State-of-the-Art Sheet Mill in the Midwest • 3M-ton Greenfield 84” Sheet Mill with 76” tandem cold mill and two galvanizing lines Planned Product Mix (annual tons in 000s) • Capex budget of approximately $2.7 billion • Projected through-the-cycle annual EBITDA Cold Roll of $52
Slide 26: Kentucky Plate Mill Project
KENTUCKY PLATE MILL PROJECT • State of the art mill situated on the Ohio River in the middle of the largest plate consuming region in the U.S. (Midwest Market) • Positions Nucor for market leadership in plate products with an ability to produce 97% of those consumed domestically Out of Nucor Range N
Slide 27: Appendix
APPENDIX NUoCorF,
Slide 28: Recent Growth Investments
RECENT GROWTH INVESTMENTS Capex Project Product Startup ($ millions) Ohio Rebar Rolling Mill Modernization Bar 2019 $85 2020 Cost & Profit Performance well above budget Gallatin, KY Hot Band Galvanizing Line Sheet 2019 $200 2020 was first full year of production – 40% ahead of plan Arkansas Specialt
Slide 29: Strategic Investments Long Products
STRATEGIC INVESTMENTS LONG PRODUCTS Improving Scale, Diversification and Earnings Power Nucor Steel Kankakee, Inc. Nucor Steel Marion, Inc. • Built a full range merchant bar mill at existing Illinois steel mill • Modernization of rolling mill at Ohio bar mill leveraging existing melt capacity • Upda
Slide 30: Market Channels & End Markets
MARKET CHANNELS & END MARKETS Nucor Channels to Market End-use Markets Served Nucor 2020 Direct / Known End Use Energy 52% 10% Heavy Construction Equipment & 56% Agriculture 6% Machinery & Industrial Service Equipment Centers 10% 27% Others 0.4% Transport & Nucor Logistics Downstream, Appliances, 7%
Slide 31: EBITDA Reconciliation
EBITDA RECONCILIATION 2020 2019 2018 2017 2016 2015 NET EARNINGS 836 1,371 2,481 1,381 900 193 NET INTEREST EXPENSE 153 121 136 174 169 174 PROVISION FOR INCOME TAXES -- 412 748 369 398 49 DEPRECIATION EXPENSE 702 649 631 636 613 626 AMORTIZATION EXPENSE 83 86 89 91 74 74 IMPAIRMENTS AND LOSSES ON A
Slide 32: Powerful Partnerships. Powerful Results.
POWERFUL PARTNERSHIPS. POWERFUL RESULTS. 32