Q3 2024 Nucor Corp Earnings Call

Leon Topalian: Coming, the world's safest steel company. Congratulations to the entire Nucor team, and let's continue to stay focused as we close out the year. In the third quarter, Nucor generated EBITDA of $869 million and adjusted earnings of $1.49 per share.

Steel company.

Congratulations to the entire Nucor team.

<unk> continued to stay focused as we close out the year.

In the third quarter, Nucor generated EBITDA of $869 million and adjusted earnings of $1 49 per share. These figures exclude the impact of noncash pretax charges totaling $123 million or <unk> 44 per share, which Steve will provide more color on.

Leon Topalian: These figures exclude the impact of non-cash pre-tax charges totaling $123 million, or $0.44 per share, which Steve will provide more color on shortly. Nucor is committed to returning cash to shareholders and making prudent investments that create long-term shareholder value. And so far this year, we've made significant headway on both objectives. Through September, Nucor has returned $2.3 billion to shareholders through our share repurchases and dividends, and we've completed $2.3 billion of capital expenditure. All of this has been funded with operating cash flow and cash on hand, which ended the quarter at approximately $4.9 billion.

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<unk> is committed to returning cash to shareholders and making prudent investments that create long term shareholder value and so far this year. We've made significant headway on both objectives through September Nucor has returned $2 3 billion to shareholders through our share repurchases and dividends.

We've completed $2 3 billion of capital expenditures all of this has been funded with operating cash flow and cash on hand, which ended the quarter at approximately $4 9 billion.

Leon Topalian: Let me take a moment to provide a brief update on where things stand for some of our largest capital projects. In the first half of 2025, we will commence operations of the new melt shop at our existing bar mill in Kingman, Arizona, and we will commission our new rebar micromill located in Lexington, North Carolina. Also in 2025, we plan to complete construction of two highly automated utility tower manufacturing facilities and a new galvine and coating complex at Nucor Steel, Indiana. Turning to 2026, we expect to commission our automotive grade gaveline at our Berkeley County Sheet Mill in South Carolina by the middle of the year.

Let me take a moment to provide a brief update on where things stand for some of our largest capital projects.

In the first half of 'twenty five we will commence operations of the new melt shop at our existing bar mill in Kingman, Arizona, and we will commission, our new rebar micro mill located in Lexington, North Carolina.

Also in 2025, we plan to complete construction of two highly automated utility tower manufacturing facilities, and a new galvanized and coating complex at Nucor steel, Indiana.

Turning to 2026, we expect to commission, our automotive grade <unk> at our Berkeley County sheet Mill in South Carolina by the middle of the year.

Leon Topalian: And by the end of 2026, we expect to complete construction of our new state of the art sheet mill in West Virginia. Each of these projects is designed to address specific customer needs and will serve as catalysts for long-term earnings growth.

And by the end of 2026, we expect to complete construction of our new state of the art sheet mill in West Virginia.

Each of these projects is designed to address specific customer needs and will serve as catalyst for long term earnings growth and while it can take time for large projects like these to reach their full earnings potential. Our team has a strong track record of safely doing whatever it takes to get there.

Leon Topalian: And while it can take time for large projects like these to reach their full earnings potential, our team has a strong track record of safely doing whatever it takes to get there. We're also making progress integrating the teams and operations from recent acquisitions, including Ritech and Southwest Data Products. These businesses present compelling growth opportunities for overhead door and racking platforms, and we are pleased with the early progress we're already starting to recognize.

We're also making progress integrating the teams and operations from recent acquisitions, including our itek and southwest data products. These businesses present compelling growth opportunities for overhead door and racking platforms and we are pleased with the early progress we're already starting to recognize.

Leon Topalian: While the broader U.S. economy continues to be resilient, decreased steel demand from several of our end-use markets, along with higher import volumes, has put pressure on our margins throughout the year. The Federal Reserve's recent actions are a good start, but it will likely take more time, more rate relief, and looser lending conditions before we start to see the flow-through effect in the construction, industrial, and consumer durables market that are so impactful to steel demand.

While the broader U S economy continues to be resilient decreased steel demand from several of our end use markets along with higher import volumes has put pressure on our margins throughout the year. The federal Reserve's recent actions are a good start but it will likely take more time more rate relief and looser lending conditions.

Before we start to see the flow through effect and the construction industrial and consumer durables market that are so impactful to steel demand.

Leon Topalian: That said, several markets do remain quite healthy. For example, construction related to semiconductor factories, advanced manufacturing facilities, data centers, and institutional buildings are still very strong.

That said several markets do remain quite healthy for example, construction related to semiconductor factories advanced manufacturing facilities data centers and institutional buildings are still very strong.

Leon Topalian: There are several near-term catalysts with the potential to improve underlying steel fundamentals for 2025. A few leading indicators we monitor have started to trend higher, and further easing of monetary policy could spur increased construction activity as we get into next year. And while we recognize that new infrastructure spending has been less steel intensive than originally expected, we do still expect to generate incremental demand in the years ahead.

There are several near term catalysts with a potential to improve underlying steel fundamentals for 2025.

A few leading indicators, we monitor has started to trend higher and further easing of monetary policy could spur increased construction activity as we get into next year.

And while we recognize that new infrastructure spending has been less steel intensive than originally expected, we do still expect to generate incremental demand in the years ahead.

Leon Topalian: We look to the future. Nucor is well positioned, given our diverse set of capabilities. And moving forward, we'll continue to seek ways to further diversify by investing in higher margin businesses that are less cyclical and more aligned with secular growth trends. We have seen this play out in 2024, as returns from our steel product segment has shown more resilience than our steel. Steel product bookings and volumes may have fallen from their peaks, but current EBITDA margins remain well above historic averages.

So we look to the future Nucor is well positioned given our diverse set of capabilities.

And moving forward, we will continue to seek ways to further diversify by investing in higher margin businesses that are less cyclical and more aligned with secular growth trends.

We have seen this play out in 2024 is returns from our steel products segment has shown more resilience than our steel mills.

Steel product bookings and volumes may have fallen from their peaks, but current EBITDA margins remain well above historic averages.

Leon Topalian: During the 12-month period ending in September, our Steel Products segment contributed 42% of Nucor's pre-tax earnings, which is nearly three times that of historical average earnings.

During the 12 month period ending in September our steel products segment contributed 42% of Nucor's pre tax earnings, which is nearly three times that of historical averages.

Leon Topalian: There's been a lot of attention on trade recently. So let me touch on that topic now. Nucor, along with other domestic steel producers, continues to advocate for the vigorous enforcement of trade laws. The recent surge in high emissions imported steel continues to negatively affect both domestic steel prices and mill utilization. As a result, Nucor recently joined several other steel producers in filing cases against imports of corrosion-resistant, flat-rolled steel from 10 nations. As we have done for decades, we will continue to closely monitor imports and bring cases when products are illegally traded in our markets. We applaud the International Trade Commission's preliminary determination that there is reasonable indication that the domestic corrosion-resistant steel industry has been materially injured as a result of illegally dumped and subsidized imports.

There's been a lot of attention on trade recently, so let me touch on that topic now nucor along with other domestic steel producers continues to advocate for the vigorous enforcement of trade laws. The recent surge in high emissions imported steel continues to negatively affect both the domestic steel prices.

And mill utilization rates.

As a result, Nucor recently joined several other steel producers in filing cases against imports of corrosion resistant flat rolled steel from 10 nations.

As we've done for decades, we will continue to closely monitor imports and bring cases when products are illegally traded in our market.

We applaud the international trade Commission's preliminary determination that there is reasonable indication that the domestic corrosion resistant steel industry has been materially injured as a result of illegally dumped and subsidized imports.

Leon Topalian: We also applaud the Department of Commerce decision in August to continue classifying Vietnam as a non-market economy. State-owned enterprises continue to play a major role in Vietnam's economy, and China continues to circumvent trade duties by relocating production and shipping products through Vietnam. Any change to Vietnam's market status would have significantly impacted the calculation of U.S. anti-dumping duty.

We also applaud the department of Commerce decision in August to continued classifying Vietnam as a non market economy state owned enterprises continue to play a major role in Vietnam as economy in China continues to circumvent trade duties by relocating production and shipping products through Vietnam.

Any change to Vietnam market status would have significantly impacted the calculation of U S antidumping duties.

Leon Topalian: With the 2024 presidential election just two weeks away, we believe the American steel industry is well positioned, regardless of the outcome. We've made it a priority to work with elected officials from both parties in Congress and with both Republican and Democratic administrations, and both have a strong grasp of our trade issues. After years of work by our industry, there is now bipartisan consensus that strong trade enforcement is a priority and that we need to fix our trading relationship with China. There's also been strong bipartisan support for infrastructure spending. We look forward to working with whichever administration is in office, just as we have done for decades.

With a 2024 presidential election, just two weeks away, we believe the American steel industry is well positioned regardless of the outcome.

We've made it a priority to work with elected officials from both parties in Congress and with both the Republican and Democratic administrations, and both have a strong grasp of our trade issues.

After years of work by our industry. There is now bipartisan consensus that strong trade enforcement is a priority.

And that we need to fix our trading relationship with China.

There has also been strong bipartisan support for infrastructure spending.

We look forward to working with whichever administration is in office, just as we have done for decades.

Leon Topalian: With that, I'll turn it over to Steve, who will share additional details on our third quarter financial results.

Speaker Change: With that I'll turn it over to Steve who will share additional details on our third quarter financial results Steve.

Steve Sumoski: Steve. Thank you, Leon, and thank you for joining us on the call this morning. During the third quarter, Nucor generated net earnings of $250 million, or $1.05 per share, on a gap-based As Leon mentioned earlier, we booked one-time, non-cash charges totaling $123 million, or 44 cents per share, during the quarter. These pre-tax charges included an $83 million dollar impairment of certain non-current assets in our raw material segment and a $40 million dollar impairment of certain non-current assets in our steel product segment. Excluding these charges, our adjusted earnings were approximately $373 million, or $1.49 a share.

Steve: Thank you Leon and thank you for joining us on the call. This morning.

Steve: During the third quarter Nucor generated net earnings of $250 million or $1 <unk> per share on a GAAP basis.

Steve: As Leon mentioned earlier, we booked onetime noncash charges totaling $123 million or <unk> 44 per share during the quarter. These.

Steve: These pre tax charges included an $83 million impairment of certain non current assets in our raw materials segment, and a $40 million impairment of certain non current assets in our steel products segment.

Steve: Excluding these charges our adjusted earnings were approximately $373 million or $1 49, a share.

Steve Sumoski: Through September, Nucor's year-to-date adjusted earnings were approximately $1.8 billion, or $7.66. Earnings of segment level results, the steel mill segment generated pre-tax earnings of $309 million. A decrease of roughly 50% from the prior quarter. Lower realized pricing, especially among our sheet mills, was the largest driver of reduced profitability. Steel Products Delivered Adjusted Pre-Tax Earnings of $354 Million for the 3rd Quarter, a decline of approximately 20% compared to the 2nd quarter. Volumes for this segment were 6% lower than prior quarters. The quarter saw a lower realized pricing for joist, deck, and tubular products, while pricing for most other products in this segment remained relatively stable.

Steve: Through September Nucor's year to date adjusted earnings were approximately $1 8 billion or $7 66 a share.

Steve: Turning to segment level results the steel mills segment generated pretax earnings of $309 million.

Steve: A decrease of roughly 50% from the prior quarter.

Steve: Lower realized pricing, especially among our sheet mills was the largest driver of reduced profitability.

Steve: The steel products segment delivered adjusted pre tax earnings of $354 million for the third quarter, a decline of approximately 20% compared to the second quarter.

Steve: Volumes for the segment were 6% lower than prior quarter.

Steve: The quarter saw lower realized pricing for joist deck and tubular products, while pricing for most other products in this segment remained relatively stable.

Steve Sumoski: Nucor operates the most diverse and comprehensive range of market solutions in our industry. In our steel product segment, our joist and deck and tubular products business typically account for about 40% of segment shipments. So let me provide a little more color on these two businesses. Average realized joist and deck pricing during the past quarter was down about 7% from the prior quarter, while joist and deck pricing has continued to moderate from the peak levels of recent years. Backlogs remain strong through the first quarter of 2025, and we continue to earn attractive margins in this business, well above historic average.

Steve: Nucor operates the most diverse and comprehensive range of market solutions in our industry.

Steve: In our steel products segment, our joist and deck and tubular products business typically account for about 40% of segment shipments.

Steve: Let me provide a little more color on these two businesses.

Steve: Average realized choice in that pricing during the past quarter was down about 7% from the prior quarter.

Our joist and deck pricing has continued to moderate from the peak levels of recent years.

Steve: Backlogs remained strong through the first quarter of 2025, and we continue to earn attractive margins in this business well above historic averages.

Steve Sumoski: As for our tubular products, declining sheet prices have meant lower substrate costs, but this benefit has been offset by weaker tube prices. Software Demand, Additional New Domestic Supply, and Increased Imports have combined to weigh on pricing and margins for tubular products. An important part of Nucor's strategy is continued value creation and accelerated growth in what we call expand beyond. Over the past few years, Nucor has made meaningful strides to increase our range of solutions and leverage our exposure to key macro trends and markets. including adding several entirely new businesses into the Nucor portfolio. Three of these businesses, insulated metal panels, racking, and overhead doors, generated EBITDA of approximately $380 million over the past 12 months.

Steve: As for our tubular products declining sheet prices have meant lower substrate cost, but this benefit has been offset by weaker to pricing <unk>.

Steve: Softer demand additional new domestic supply and increased imports have combined to weigh on pricing and margins for tubular products.

Steve: An important part of Nucor strategy is continued value creation and accelerated growth in what we call expand beyond.

Steve: Over the past few years Nucor has made meaningful strides to increase our range of solutions and leverage our exposure to key macro trends in markets, including adding several entirely new businesses into the new core portfolio.

Steve: Three of these businesses insulated metal panels, racking and overhead doors generated EBITDA of approximately $380 million over the past 12 months.

Steve Sumoski: While they're not immune to the impacts of the changes in the construction market. The relative stable earnings power is a testament to the resilience. Looking ahead, we remain optimistic in the growth prospects for these businesses and expect them to serve as meaningful catalysts in Nucor's cash flow growth in years to come. Our raw material segment realized adjusted pre-tax earnings of approximately $17 million for the quarter, down approximately $22 million from the second quarter. Lower volumes and margins in our recycling operations were the primary drivers for the change in quarter-over-quarter performance. Turning to our fourth quarter outlook, we expect Nucor's consolidated net earnings to be lower than that of the third quarter.

Steve: While they're not immune to the impacts of the changes in the construction markets. The relative stable earnings power is a testament to the resilience.

Steve: Looking ahead, we remain optimistic in the growth prospects for these businesses and expect them to serve as meaningful catalyst in nucor's cash flow growth in years to come.

Steve: Our raw materials segment realized adjusted pre tax earnings of approximately $17 million for the quarter down approximately $22 million from the second quarter.

Steve: Lower volumes and margins in our recycling operations were the primary drivers for the change in quarter over quarter performance.

Steve: Turning to our fourth quarter outlook, we expect nucor's consolidated net earnings to be lower than that of the third quarter.

Steve Sumoski: The majority of this anticipated variance is attributable to the steel mill segment, where earnings are expected to decline on lower realized pricing and seasonally lower volume. We also expect sequentially lower earnings in our steel products. also due to lower realized pricing and volume. Earnings in the raw material segment are expected to be moderately higher. Taken together, consolidated EBITDA for the fourth quarter could be meaningfully lower than the third. Turning to 2024 capital expenditures, we now expect CapEx for the full year to be approximately $3.2 billion, slightly lower than the $3.5 billion estimate provided at the start of the year.

Steve: The majority of this anticipated variance is attributable to the steel mill segment, where earnings are expected to decline on lower realized pricing and seasonally lower volumes.

Steve: We also expect sequentially lower earnings in our steel products segment.

Steve: Also due to lower realized pricing and volumes.

Steve: Earnings in the raw materials segment are expected to be moderately higher taken.

Steve: Taken together consolidated EBITDA for the fourth quarter could be meaningfully lower than the third quarter.

Steve: Turning to 2020 for capital expenditures, we now expect Capex for the full year to be approximately $3 2 billion slightly lower than $3 $5 billion estimate provided at the start of the year.

Steve Sumoski: With approximately two-thirds of Nucor's capital spending going into growth-oriented expansions, many of these projects are multi-year in nature. Consequently, as we look toward 2025, we expect Nucor to continue to have capital expenditures above its historic During the third quarter, the power of Nucor's business model allowed it to generate $1.3 billion in cash from operations. This strong cash generation is a key factor enabling Nucor to continue its balanced, consistent, and long-term approach to allocating capital and creating value. During the quarter, Nucor provided meaningful direct returns to shareholders of $530 million by way of buybacks and dividends.

Steve: With approximately two thirds of nucor's capital spending going into growth oriented expansions. Many of these projects are multi year in nature.

Steve: Consequently, as we look toward 2025, we expect nucor to continue to have capital expenditures above historic norms.

Steve: During the third quarter, the power of Nucor's business model allowed us to generate $1 3 billion in cash from operations. This strong cash generation is a key factor, enabling nucor to continue its balanced consistent and long term approach to allocating capital and creating value.

Steve: During the quarter Nucor provided meaningful direct returns to shareholders of $530 million by way of buybacks and dividends.

Steve Sumoski: We also continue to invest for long term growth, deploying approximately $820 million in growth cap. and grew our expand beyond capabilities, closing on the acquisition of Rytec for $565 million. Nucor has executed on these endeavors, all while maintaining a strong balance. At the end of the third quarter, our total leverage stood at roughly 1.4 times trailing 12-month EBITDA, and our cash on hand was a healthy $4.9 billion. This position of strength is a foundational source of advantage and an enabler of continued future growth, value creation, and shareholder return.

Steve: We also continue to invest for long term growth deploying approximately $820 million in growth Capex and grew our expanded capabilities closing on the acquisition of Wright Tech for $565 million.

Nucor has executed on these endeavors, all while maintaining a strong balance sheet.

Steve: The end of the third quarter, our total leverage stood at roughly one four times trailing 12 month EBITDA and our cash on hand was a healthy $4 9 billion.

Steve: This position of strength as a foundational source of advantage and an enabler of continued future growth value creation and shareholder returns.

Unknown Executive: And with that, we'd like to hear from you and answer any questions you may have. Operator, please open the line for questions. Thank you. Ladies and gentlemen, we will now begin the question and answer session. To ask a question, you may press the star followed by the number one on your telephone keypad. If you're using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press the star followed by the number two. One moment please for your first question. Your first question comes from the line of Lawson Winder with Bank of America Securities.

Steve: And with that we'd like to hear from you and answer any questions. You may have operator, please open the line for questions.

Speaker Change: Thank you ladies and gentlemen, we will now begin the question and answer session to ask a question you May Press Star followed by the end of your line on your telephone keypad.

Speakerphone, please pick up your handset before pressing any key debate you buy your question. Please press the star followed by the number Q1 moment. Please for your first question.

Speaker Change: Your first question comes from the line up Lawson Winder with Bank of America Securities. Please go ahead.

Lawson Winder: Please go ahead. Thank you, operator. And good morning, Leon and team. Thank you for the update. I wanted to ask about Brandenburg, if I should. Could you just comment on the ramp up there, the outlook for continued growth in production? And any comments on the plate pricing outlook would be really helpful. Absolutely, Lawson. Appreciate the question and I'll kick it off and turn it over to Brad Ford and ask him a comment with some specifics. But I would tell you in general, we're incredibly optimistic about our plate market, our plate group, the things that are going on, again, against the backdrop of the plate market, and in particular Brandenburg and its continued ramp up.

Lawson Winder: Thank you operator, and good morning, Leon and team. Thank you for the update.

Lawson Winder: I wanted to ask about.

Speaker Change: Brandenburg, if I said.

Lawson Winder: Could you just comment on the ramp up there the.

Speaker Change: The outlook for.

Lawson Winder: Continued growth in production.

Lawson Winder: And any comment.

Lawson Winder: The plate pricing outlook would be.

Lawson Winder: Really helpful.

Speaker Change: Absolutely Awesome I appreciate the question and I'll kick it off and turn it over to Brad for asking my comment.

Lawson Winder: Perfect, but I would tell you in general.

Lawson Winder: We're incredibly optimistic about our plate market are things that are going on again against the backdrop of the plate market and in particular Brandenburg and its continue to ramp up the team there continues to operate in <unk>.

Brad Ford: The team there continues to operate incredibly well. And again, we're proud of that success. We're proud of how they've done it incredibly safely and positioned Nucor with the widest and most diverse set of plate offerings in North America. But Brad, maybe you want to touch on the exact ramp up, what we've done to date, and then the outlook, not so much in pricing, but you know, how we continue to to build on our current portfolio as we move forward. Thanks, Leon, and thanks for the question. I'll echo what Leon said and thank our team for their accomplishments during the quarter, most notably in September when the team broke records across the board in terms of performance, production records, milk cast records, rolling records, shipping records, our lowest conversion cost of the year, and a bookings record.

Lawson Winder: Incredibly well and again, we're proud of that success, we're proud of how they've done it incredibly safely and positioned nucor with a y.

Lawson Winder: And most diverse set of plate offerings in North America, but Brad maybe you want to touch on the exact ramp up what we've done to date and then the outlook not so much in pricing, but how.

Lawson Winder: We continue to.

Lawson Winder: To build on our current portfolio as we move forward.

Speaker Change: Thanks, Liana thanks for the question.

Lawson Winder: Yes.

Brad: Leon said and thank our team for their accomplishments during the quarter most notably in September.

When the team broke records across the board in terms of performance.

Brad: Production Records Milt cash records rolling record shipping record.

Brad: Lowest conversion costs for the year, and then bookings record so truly a step change in the performance out of Brandenburg and.

Brad Ford: Truly a step change in the performance out of Brandenburg. And we continue to see improvements in utilization, in product development, in quality, and see better results each quarter. Just as a reminder, Brandenburg was built to expand the capabilities of the plate group portfolio. And there are grades and sizes that we'll only be able to make at Brandenburg. But as we think about ramping up, really targeting those volumes, those applications, and those customers specifically, things like the 150-inch wide plate that we shipped on our proprietary tilt cars for a bridge project during the quarter, or the order that we received for Elsion, our branded S355 monopile plate for offshore wind.

Brad: And we continue to see improvements in utilization and product development and quality.

Brad: <unk> seen better results each quarter.

Brad: And just as a reminder, brandenburg.

Brad: Build to expand the capabilities of the plate group portfolio.

Brad: Their grades and sizes.

Brad: Only be able to make at Brandenburg. So as we think about ramping up really targeting those those volumes those applications and those customers specifically things like the 150 inch wide plate that we shipped on our proprietary tilt cars for a bridge project during the quarter or the order that we received for LCR branded.

Brad: 355, monetize play for offshore wind.

Leon Topalian: And our customers are excited about the capabilities at Brandenburg. As we meet with them and they get a chance to visit and spend time with our team, they get even more excited about sourcing a domestic, sustainable product out of Brandenburg to meet their needs. And we'll continue to ramp up Brandenburg thoughtfully and methodically. Tonnage will come, as evidenced by the increased shipments each quarter this year, but we're really focused on the right tonnage, the right mix of products that maximize profitability, not just at Brandenburg, but across our plate. Okay, that's a very helpful color. If I could ask a follow up, you commented in your Release that lower interest rates would take time to flow through and that's been a consistent discussion that we've been having in terms of a catalyst for steel pricing and for steel demand in general.

Brad: And our customers are excited about the capabilities of Brandenburg as we meet with them and they get a chance to visit and spend time with our team.

Brad: You get even more excited about sourcing of domestic sustainable product Brandenburg to.

Brad: To meet their needs.

Brad: We'll continue to ramp up Brandenburg thoughtfully and methodically.

Brad: Tonnage will come as evidenced by the increased shipments each quarter. This year, but we're really focused on the right tonnage.

Brad: The right mix of products that maximize profitability not just at Brandenburg, but across our plate group.

Brad: Okay.

Brad: Okay.

Speaker Change: Okay. That's very helpful color, if I could ask a follow up.

Speaker Change: You commented in your.

Speaker Change: Release that.

Speaker Change: Lower interest rates would take time to flow through and that that's been a consistent discussion that we've been in.

In terms of a catalyst for the for steel pricing for steel demand in general.

Leon Topalian: Do you have any thoughts on when profit might start to flow through? Yeah, I would tell you, you know, I think, Lawson, as we see that, I think it's compounded with the current election. Quite frankly, I think as we see some clarity in hopefully two and a half weeks, You know, we not just as an industry in the steel industry, but as a nation began to, okay, now we, we can take out the ambiguity and the uncertainty of trade policy, whether that's taxes, imports, tariffs, and the like, to know how to position ourselves and our customers to position themselves.

Speaker Change: Do you have any thoughts on that.

Speaker Change: It might start to flow through.

Speaker Change: Yes, I would tell you.

Speaker Change: I think Washington is we see that I think it's compounded with the current election quite frankly, I think as we see.

Speaker Change: Some clarity and hopefully two five weeks.

Speaker Change: Not just as an industry the steel industry, but as a nation began to okay. Now we can take out the ambiguity and the uncertainty of trade policy, whether that's taxes.

Speaker Change: Import tariffs and the like to know how to position ourselves and our customers to position themselves.

Leon Topalian: So have a more surety of the lending environment. And again, the fiscal environment in which they continue to release those projects. So I think both the interest rate flow through and again, the initial drop of 500 basis points, as well as what's forecasted for the end of the year and into 25. Again, I don't think that's measured in, you know, the back half of 25. I think that'll flow through much faster. But again, against the backdrop of the current election, I think we got to get through that. And then you'll start to see some movement in releasing of current jobs and those that are kind of been waiting just to see right, what's, what's the corporate tax rate going to end up at?

Speaker Change: Surety of the lending environment and again, the physical environment in which they continue to release those projects. So I think both the interest rate flow through and again the initial drop off of 500 basis points as well as what's forecasted for the end of the year and into 'twenty five.

Speaker Change: I don't think thats measured in.

Speaker Change: The back half of 'twenty, five I think that will flow through much faster, but again against the backdrop of the current election, I think we got to get through that and then youll start to see some movement.

Speaker Change: We're leasing of current jobs and those that are kind of been waiting just to see right.

Speaker Change: What is the corporate tax rate going to end up at what are we going to do with trade what's the <unk>.

Steve Sumoski: What are we going to do with trade? What's the environmental regulation environment going to look like in the United States post two weeks from now. So stay tuned. But I do think that movement should begin to release post November. Lawson, if I could, I'd just add a comment to what Leon said. The backdrop of the macroeconomic conditions that we're in are actually very encouraging. If you think about it, with unemployment being where it is in our consumer-driven economy, we've seen the CPI and the Fed's favorite measure of PCE come down quite a bit over the last two years.

Speaker Change: <unk> regulation environment going to look like in the United States post.

Speaker Change: Two weeks from now so Steve.

Speaker Change: Stay tuned, but I do think that movement should.

Speaker Change: Begin to release post November.

Speaker Change: Okay.

Speaker Change: Boston, if I could.

Speaker Change: I'll just add a comment to what Lee said.

Speaker Change: The backdrop of the macroeconomic.

Boston: Conditions that we're in are actually very encouraging.

Boston: Got it what's unemployment being where it is in our consumer driven economy, we've seen.

Boston: And Thats favorite measure PCE come down quite a bit over the last few years and if you think back to the economists are projecting maybe 18 to 24 months ago that we would be in a recession.

Lawson Winder: And if you think back to where economists were projecting maybe 18 to 24 months ago, that we would be in a recession. were actually in a fairly stable and good place, so those points that Leon was highlighting have even more potential catalyst and impact given the relative stability in the overall macroeconomy. Okay, that's very helpful. Thank you all for that and best of luck. Thanks a lot.

Boston: Actually in a fairly stable and good place. So those points that Leon was highlighting have even more potential catalyst impact given the relative stability in the overall macro economy.

Boston: Yes.

Speaker Change: Okay. That's very helpful. Thank you all for that and best of luck.

Boston: Okay.

Boston: Thanks, a lot.

Boston: Okay.

Timna Tann: Your next question comes from the line of Timna Tann with Wolf Research. Please go ahead. Yeah. Hey, good morning, everyone. Hope you're doing well. I wanted to ask about two things. One is When you talked on Investor Day a couple years ago, there was going to be quite a bit of contribution from a number of government initiatives. I think we're well underway with those spending patterns with the IRA and the CHIPS Act and IIJA. What do you think you've seen and what do you think has yet to materialize of those numbers you disclosed in the past?

Speaker Change: Your next question comes from the line of Jim Mccann with Wolfe Research. Please go ahead.

Jim McCann: Yeah, Hey, good morning, everyone hope you're doing well.

Jim McCann: I wanted to ask about two things one is.

Jim McCann: When you talked about Investor day, a couple of years ago, there is going to be quite a bit of contribution from number of government initiatives I think we're well underway with the spending patterns with the Iran. The chip back then I Ajay.

Jim McCann: What do you think you've seen and what do you think is yet to materialize at those numbers you disclosed in the past.

Timna Tann: Yeah, Timna, look, I think it's a fair question. And like you, we continue to wait to see on some of those IAJ and IRA being the two probably in the still in the early stages of that. You know, the good thing is, as we know, it's past the legislation, it's not maybe in might be it's okay, at what point does that flow into our sector, but look, we have seen meaningful moves, particularly in chips, right with over $370 billion of committed projects, I think that comes out to something in the range of about 60 semiconductor facilities that are planned to be built in the United States with over 20 of those now currently under construction.

Speaker Change: Yeah, Tim Hey, look I think it's a fair question and like you. We continue to wait to see on some of those high Jane IRI being the two probably in the still in the early stages of that the good thing is as we know it's passed legislation, it's not maybe in might be okay. At what point does that flow in.

Jim McCann: Two our sector, but look we have seen meaningful.

Moves, particularly in ships right with over $370 billion of committed projects I think that comes out to something in the range of about 60 semiconductor facilities that are.

Jim McCann: And to be building United States with over 20 of those now currently under construction. So those are the massive major complex is facilities or large scale.

Leon Topalian: So those are massive, major complexes, facilities are large scale, not only still intensive and building them, but also supplying our end use customers to move through. So that's moving. Again, we've seen some support in the IRA in terms of solar and core tubes that we're supplying. But again, I would tell you on both infrastructure and IRA, we've yet to see the meaningful flow through in both of those pieces of legislation into the order books. So yeah, sorry. Well, look, I'm going to say what Steve and I just commented to the macro economic trends that look, the election is going to have a big part of that.

Jim McCann: Only steel intensive and building them, but also supplying our end use customers to move through so that's moving again, we've seen some support in the IRI in terms of solar.

Jim McCann: CT tubes, we're supplying but again I would tell you on both infrastructure and IRI.

Jim McCann: Sure.

Jim McCann: We've yet to see the meaningful.

Jim McCann: Flow through in both of those pieces of legislation into the order books.

Sure.

Jim McCann: So.

Jim McCann: Yeah.

Speaker Change: Well look.

Speaker Change: What Stephen I'd, just comment in terms of the macroeconomic trends.

Speaker Change: The election is going to have a big part of that right and again I don't want to speculate on what president Trump's two point or Kamala Harris is one point out would look like but obviously.

Leon Topalian: Right. And again, I don't want to speculate on what president Trump's 2.0 or Kamala Harris's 1.0 would look like, but obviously. You know, some of that could be changed, right? There's obviously discussions of carving out pieces of the IRA. So I think in both of those, we're going to need to see the surety of, okay, who's in office and what are those fiscal policies and monetary policies going to drive through in the manufacturing sector? So of the five to seven million targeted additional tons per year that you talked about, would you say we're on the lower end or below that so far?

Speaker Change: Some of that could be change right. There is obviously discussions.

Speaker Change: Farming out pieces the iras.

Speaker Change: And both of those we're going to need to see.

Speaker Change: The surety of Okay, who is in office and what are those fiscal policies.

Speaker Change: Monetary policy is going to drive through and the manufacturing sector.

Speaker Change: So the five to 7 million targeted additional tenants per year that you talked about would you say were on the lower end or below that so far is that is that what you're talking about.

Leon Topalian: Is that is that what you're talking about? Yeah, I mean, look, we I think we estimated somewhere between three and five million tons of supply for a 10 year period of time. And so yeah, I'd say we're under that for sure. You know, I don't have a number sitting in front of me. But no, I would I would think that that categorization is safe that we're under that that scale. Okay, fair. Timna, I was just going to add as well, you know, some of the, excuse me, some of the spending we've seen to date has been more shovel-ready, less steel-intensive.

Speaker Change: Yes, I mean look we I think we estimated somewhere between three and 5 million tons of.

Speaker Change: <unk>.

Speaker Change: Supply for a 10 year period of time, and so I'd say, we're under that for sure.

Speaker Change: I don't have a number sitting in front of me, but no I would I would think that.

Categorization is safe that we're under that scale.

Speaker Change: Thank you.

Speaker Change: Jim.

Jim: AD as well.

Jim: Excuse me some of the spending we've seen to date has been more shovel ready less steel intensive.

Leon Topalian: We're starting to see some of the bridge projects come forward, and you know, one of the things that is apparent with those is just to delay the timing of those. Sometimes it can take four years or more before, once those are announced, before we're starting to see the steel arrive on those sites. Okay, super helpful. And I'll just ask one more, then if I could, I know Lawson asked about Brandenburg, but just thinking broadly into 2025, high level, you have a number of other projects that would be additional capacity, I believe, correct me if they're replacement, but I think Lexington and Kingman are additional volumes.

Jim: We're going to see some of the NIM.

Jim: The bridge projects come forward and.

Jim: The things that.

Jim: This is apparent with those is just the delay the timing of those sometimes it could take four years or more before once those are announced before we're starting to see the steel arrive on site.

Speaker Change: Okay. That's super helpful. And then I'll just ask one more then if I could I know lots and asked about Brandenburg, but just thinking broadly in 2025 high level you have a number of other projects that would be additional capacity I believe correct me, if theyre replacement, but I think Lexington in kingman or additional volume. So how do we think about that.

Leon Topalian: So how do we think about the timeframe for seeing those additional volumes hit the market? And you know, are market conditions sufficient to be able to see incremental supply from those new mills, do you think? Thank you. Yes, you know. Timna, you followed us a long time. Nucor's investment strategy and our capital allocation strategy is obviously for the long term. It's not reflective on the peaks and valleys of current market conditions. Again, I put the one caveat there that we're also keenly aware of what the end markets are doing and take the relevant required actions when necessary.

Speaker Change: I'm from pristine those additional volumes hit the market and our market conditions.

Speaker Change: To be able to see incremental supply from those in the analysis.

Speaker Change: Thank you.

Yes.

Speaker Change: <unk>.

Speaker Change: You followed us for a long time Nucor's investment strategy and our capital allocation strategy is obviously for the long term it's not.

Speaker Change: Reflective on the peaks and valleys of.

Speaker Change: Current market conditions again.

Speaker Change: The one caveat there that we're also keenly aware of what the end markets are doing and take the relevant required actions when necessary. So if we go back to 2020 with a black Swan event like a global pandemic and we paused we stopped.

Leon Topalian: So if we go back to 2020 with a black swan event like a global pandemic, man, we paused. We stopped Brandenburg our project in Gallatin at the time, just to really analyze, well, how deep was this? How long would it stay with us? But as we look today at those projects, you name they are additional capacity, but we're in a commodity driven business, supply and demand is always going to dictate. So if we have the best quality, lowest price, offer a differentiated capability set, we're going to win. And so I love where Nucor sits. I love our growth strategy and the markets that we're going to serve because they're underserved.

Speaker Change: Brandenburg.

Speaker Change: Our project in <unk> at the time, just to really analyze how deep was this how long would it stay with us, but as we look today at those projects you name. They are additional capacity, but we're in a commodity driven business supply and demand is always going to dictate. So if we have the best quality lowest price offer a dip.

Speaker Change: <unk> capabilities are going to win and so.

Speaker Change: I Love, what Nucor since I love our growth strategy in the markets that we're going to serve because they are underserved. If you take west Virginia for example in the northeast that is the lowest.

Leon Topalian: If you take West Virginia, for example, in the Northeast, that is the lowest market share that we have in the entire U.S. So we're underrepresented in that region. And again, we can bring a very different set of products to that market that, again, we know our customers are asking for and demanding. So as that comes online and again, obviously in sheeting, you're keenly aware we're talking startup by the end of 26, but really meaningful volumes into 27. So you're still a couple of years away before that happens. And again, what does the economy look like then?

Speaker Change: <unk> market share that we have in the entire U S. So we're underrepresented in that region and again, we can bring a very different set of.

Speaker Change: Products to that market that again, we know our customers are asking for and demanding.

Speaker Change: As that comes online and again, obviously in sheet.

Speaker Change: You're keenly aware, we're talking to startup by the end of 2006, but really meaningful volumes into 27 months or you are still a couple of years away before that.

Speaker Change: That happens and again, what does the economy look like then while I can't predict what I can predict.

Leon Topalian: Well, I can't predict. What I can predict is when you reference our investor day in November 2022, we are confident that our through cycle earnings power with the combination of West Virginia will be at or above $6.7 billion of through cycle EBITDA. So again, we love our investment portfolio, where we're going, the SpanBeyond piece, that's very complimentary. And again, we feel confident in the additions we're making. in the backdrop of our unused demand. Okay, thank you all.

Speaker Change: When you referenced.

Speaker Change: Our Investor Day in November 2022.

Speaker Change: Our.

Speaker Change: Confident that our through cycle earnings power with the culmination.

Speaker Change: West, Virginia will be at or above $6 $7 billion of through cycle EBITDA. So, yes, we love our investment portfolio, where we're going the span beyond piece, that's very complementary and again, we feel confident in the additions were making in this in the backdrop of our end use demand.

Speaker Change: Okay. Thank you.

Unknown Executive: Thank you.

Speaker Change: Thank you.

Martin Englert: Your next question comes from the line of Martin Englert with Seaport Research. Please go ahead. Hello, good morning, everyone. Good morning. I wanted to briefly touch on the steel conversion costs, unit costs in your guidance in the slide deck. You expect some slight decrease quarter on quarter on 4Q. I'm curious why a decline given that you're also expecting lower volumes. Does this have to do with substrate costs or some other costs? And then along the same lines, there are longer term. Maybe if you could speak to where you expect through cycle conversion costs after you've kind of exited ramp up costs with green.

Speaker Change: Your next question comes from the line of Martin Englert with Seaport Research. Please go ahead.

Speaker Change: Hello, Good morning, everyone.

Good morning wanted to briefly touch on steel conversion costs unit costs in your guidance in the slide deck you expect some.

Speaker Change: Decrease quarter on quarter on for Q, I'm curious why that decline given that you're also expecting lower volumes.

Speaker Change: Substrate costs or some other costs.

Speaker Change: And then along the same lines that are longer firm, maybe if you could speak to where you expect through cycle conversion costs.

Speaker Change: Ask or use.

Speaker Change: <unk> kind of exited.

Speaker Change: <unk> costs with Greenfield facilities.

David Sumoski: Thanks for the question, Martin. This is Dave Sumoski. When we look at costs, and I'm sure you've looked at costs pre-COVID versus today. They've gone up quite a bit. Inflation, utilization have been a big part of that. CSI, the addition of CSI into our consolidated reporting comes up in operational costs based on our accounting. Then the startup costs, as you mentioned. So outside resource is critical. Our startups have been stressed, and that's really affected a lot of our startups. So that has certainly increased our costs. So as we move forward, we don't really see inflation.

David Muskie: Thanks for the question Martin David Muskie.

Speaker Change: Yes.

Good morning, when you look at cost and I'm sure you've looked at cost pre COVID-19 versus today.

Speaker Change: They've gone up quite a bit of.

Speaker Change: Inflation utilization, that's been a big part.

Speaker Change: Part of that.

Speaker Change: Si. The addition of CSI into our consolidated reporting.

Speaker Change: Comes up and operational cost based on our accounting than the startup costs you mentioned.

Speaker Change: So outside resources critical or startups been stressed and thats really affected a lot of our startups. So that has certainly increased our costs.

Speaker Change: So as we move forward, we don't really see inflation, although it's stabilized it's not it's not a ratcheting back.

David Sumoski: Although it's stabilized, it's not ratcheting back. But our utilizations will go up as our startups increase in effectiveness. And we made several very good improvements, and we feel good about the fourth quarter. If you see a big impact, you know, it's just in the fourth quarter, probably not going to see that, but we're going to see an impact based on the utilization rates coming up and our startup costs going down. And we have a tremendous amount of projects still going on and some of them coming on and going off from startup mode still will still continue to affect our costs in the future.

Speaker Change: Our Utilizations will go up as our startups increase.

Speaker Change: Effectiveness.

Speaker Change: Several very good.

Speaker Change: Improvements and we feel good about the fourth quarter.

Speaker Change: Sure.

Speaker Change: If you see a big impact just in the fourth quarter.

Speaker Change: Probably not going to see that but we're going to see an impact based on the utilization rates coming up and our startup costs going down and we have a tremendous amount of projects still going on and some of them coming on and going off.

Speaker Change: From startup mode still.

Speaker Change: We'll still continue to affect our costs in the future, but as all of those startups roll off.

David Sumoski: But as all those startups roll off, our costs will stabilize and get back down to maybe not pre-pandemic levels based on inflation, but considerably better. I appreciate the detail there, Dave.

Speaker Change: Our costs will stabilize and come back down to maybe not pre pandemic levels based on inflation.

Speaker Change: Considerably better.

Speaker Change: Thanks, I appreciate the detail.

Leon Topalian: A follow-up question on the core trade case, maybe if you could just remind us. New Course Coding Capabilities and Your Interest. Serving more of the lighter gauge markets wherein historically maybe some producers shied away from this due to less favorable fixed cost leverage. Yeah, Marta, I'll kick it off and Steve, if you have any additional comments, but look, we continue to look for, again, the differentiated capability set. It's not about volume. It's not about capacity. And so moving up the value chain into coated products, first, I would tell you we applaud the ITC and the administration's initial finding that there's material injury to the steel industry.

Speaker Change: Follow up question on the core trade case, maybe if you could just remind us.

Speaker Change: Nucor's coding capabilities.

Speaker Change: Your interests and serving more of the lighter gauge markets, whereas historically, maybe some producers shied away from yes.

Speaker Change: Less favorable fixed cost leverage.

Speaker Change: Yes Martin.

Speaker Change: It often.

Speaker Change: Yeah.

Speaker Change: Steve If you have any additional comments, but look we continue to look for again the differentiated capabilities said, it's not about volume, it's not about capacity and so moving up the value chain and Dakota products first I would tell you we applaud the ITC and the administration's initial finding that theres material injury to the.

Leon Topalian: We think that's long overdue. We've looked at some of the spikes that we've seen like out of Mexico, for example, of 180% in the core cases. So, again, in the backdrop of a global oversupply situation, particularly coming out of China with roughly 100 million metric tons of steel looking to find a home, while the greatest home in the world is the United States, it's the greatest and strongest economy. So how it has to get there in the circumventions, what I would tell you is Nucor and the industry need to continue to be tireless advocates in Washington.

Speaker Change: Steel industry, we think thats.

Speaker Change: Long overdue, we've looked at some of the spikes that we've seen.

Speaker Change: Mexico for example, a 180% and the core cases, so and in the backdrop of Fei.

Speaker Change: Global oversupply situation, particularly coming out of China, with roughly 100 million metric tons of steel or can you find the hull.

Speaker Change: Although the greatest showman the world as the United States is greatest and strongest economy. So how it has to get there in the circuit mentioned, what I would tell you is nucor and the industry need to continue to be tireless advocates in Washington.

Noah Hanners: Again, I'm proud of the work that's been done. I'm proud of the ITC finding, but that vigilance can never, never end. Back to your exact question, as we look to expand our coated capabilities with our galvanized Nucor Berkeley, two in West Virginia, Crawfordsville, Indiana, with the galvanizing and prepaint, it's to move us to somewhere between 35 and 40% over the next several years and, again, better reflect that growing end market, which is growing, and again, position us a little bit better in terms of the value added products and getting a little less dependent on the HRC.

Speaker Change: Again I'm proud of the work that's been done I'm proud of the ITC, finding but that vigilance can never never end.

Speaker Change: To your exact question.

Speaker Change: As we look to expand our current capabilities with our gas lines Nucor Berkeley.

Speaker Change: In West, Virginia, Crawfordsville, Indiana, with the galvanizing and prepaying, it's to move us to somewhere between 35 and 40% over the next several years and.

Speaker Change: Again better reflect that growing.

Speaker Change: End market, which is growing and again position us a little bit better in terms of the value added products.

Speaker Change: Getting a little less dependent on the HRC.

Noah Hanners: And this is Noah. Maybe just to add a little bit more color, you know, on top of Leon's comments. First of all, we're really excited about this core, the core case. It is a substantial, it's big for us. About 20% of that core steel market, if you look back to 21 through 23, has been served by import. But over the last year, we've seen an additional a million tons come to the market. So, and we've already seen an immediate impact with galve orders, especially on the West Coast improving in the last week, couple days. We still do need to see, you know, sustainability and that requires positive final determinations from the Department of Commerce.

Speaker Change: Yes.

Speaker Change: Maybe just add a little bit more color.

Speaker Change: On top of layoffs comments first of all we're really excited about this core and core pace. It is substantial.

Speaker Change: It's big for us about 20% of that core feel mark.

Look back to 'twenty, one through 'twenty three is best served by imports, but over the last year, we've seen an additional 1 million tons come to market.

Speaker Change: So and we've already seen an immediate impact with galvo orders, especially on the West coast improving last week couple of days.

Speaker Change: We still do need to see sustainability in that requires positive final determinations.

Noah Hanners: So, so we're watching, but we're excited about the potential for the findings there. You know, Leon commented on our, on our galve strategy, I'll tell you, it's really founded on two things. One is better matching, evolving customer demand, and part of that's regional. The other side of this is improving capabilities and bringing new capabilities to bear to better serve our customers. And that hits on your, your question about thinner gauge, also higher strength for us. Our galve line at Berkeley is an awesome example of this, you know, 300, it's a new auto galve line, but it's really set up to better serve the evolution of more auto production in the Southeast with capabilities that our customers are asking us to bring to the market.

Speaker Change: So we're watching but we're excited about the potential for the findings there.

Speaker Change: Leon commented on our on our Couch strategy I'll tell you. It's really founded on two things one is better matching.

Speaker Change: Evolving customer demand and part of that's regional.

Speaker Change: The other side of this is improving capabilities, bringing new capabilities to bear to better serve our customers and that hits on your your question about thinner gauge also higher strength for us.

Our guideline at Berkeley is an Awesome example of this 300 new.

Speaker Change: New auto golf line, but it's really.

Speaker Change: Up to better serve the evolution of more auto production in the south east with capabilities that our customers are asking us to bring to the market.

Noah Hanners: And we have 2 million tons of new galve capacity we're going to bring to the, to the market over the next, you know, through 27. And it all falls into that category of better aligning with our customers, regional demands and demand for more capabilities. So we're extremely excited about that. I appreciate all the granular detail. Thank you for your time.

Speaker Change: We have 2 million tons of new gas capacity, we're going to bring to the to the market over the next through 2007 and it all falls into that category of better aligning with our customers regional demands.

Speaker Change: Demand for more capability. So we're extremely excited about that.

Speaker Change: I appreciate it.

Speaker Change: Thank you for your time.

Tristan Gresser: Thank you, Mark. Your next question comes from the line of Tristan Gresser with BNP Paribas. Please go ahead. Yes, hi, good morning, and thank you for taking my questions. The first one is on the guidance. When you say you expect a meaningful contraction of earnings into Q4, when I look at the steel business, does that mean that the margins on EBITDA per ton basis could fall below COVID levels? Is the market that bad? And also on steel products, you reiterated the long-term 15% EBITDA target. Is that possible you could fall short of that target in the coming quarters?

Speaker Change: Thank you Mark.

Speaker Change: Your next question comes from the line of Justin <unk> with BNP Paribas. Please go ahead.

Speaker Change: Yes, hi, good morning, and thank you for taking my questions.

Speaker Change: First one is on the guidance.

Speaker Change: When you say you expect a meaningful.

Speaker Change: And traction of earnings into Q4.

Speaker Change: When I look at the steel business does that mean.

Speaker Change: Margins on an EBITDA per ton basis could could fall below <unk> levels.

Speaker Change: Is the market that bad.

Speaker Change: So on steel products.

Speaker Change: You reiterated the long term piece.

Speaker Change: 15% EBITDA target.

Speaker Change: Is that possible you could fall short of that target in coming quarters.

Steve Sumoski: And is the 15% actually achievable for next year? Tristan, let me, this is Steve, let me make sure I understand the last part of your question, what was the 15% of reference The 15% EBITDA margin target for the steel product. So the question is twofold. First on the steel mills, and then on the steel products. On steel mills, I was more interested on the potential to break, you know, lows versus COVID on the margin side and, and for the steel products more on the margin, could you also fall below that level near true? Yeah, yeah.

Speaker Change: Is the 15%.

Speaker Change: Actually achievable for next year.

Speaker Change: Okay.

Speaker Change: Justin Let me listen Steve Let me make sure I understood. The last part of your question 15% are referenced.

Speaker Change: Yeah.

Speaker Change: Hi, there.

Speaker Change: Percent.

Speaker Change: Margin target for the steel.

Speaker Change: So the question is two fold first Tom on the steel steel Mills, and then all the steel products.

Speaker Change: More interested on the potential to break.

Speaker Change: Those versus Covid on the margin side and for the steel products more on the margin could you also fall below that level near term.

Steve Sumoski: Well, first, thank you for the question and allowing us to kind of dig into this a little bit more. But the outlook for the fourth quarter at a at a consolidated level. is really a continuation of trends that you've seen. And we're not going to give you quantitative guidance here today. We'll do that, of course, later in the quarter, as we always do. But if you look at the sequential quarter over quarter changes that we've been realizing really for the last, you know, call it 18 months, You're really continuing that level of moderation. And so Leon unpacked earlier that, you know, the markets actually are not in a horribly bad spot.

Yes.

Speaker Change: Thank you for the question and allowing us to kind of dig into this.

Speaker Change: The outlook for the fourth quarter.

Speaker Change: At a consolidated level.

Speaker Change: He is really a continuation of trends seen in we're not going to give you a quantitative guidance.

Speaker Change: Today, we will see that of course later in the quarter.

Speaker Change: But if.

Speaker Change: If you look at the sequential quarter over quarter changes that we didn't realize.

Speaker Change: For the last call it 18 months.

Speaker Change:

Speaker Change: Youre really continuing that level of moderation.

Speaker Change: Liana unpacked earlier that the market's actually youre not in a horribly bad spot.

Unknown Executive: And, and we continue to kind of reaffirm that while we work through, you know, various things. One thing to keep in mind about our steel segment, Tristan, is you had a $168 million of pre-operated startup costs.

Steve Sumoski: And we continue to kind of reaffirm that while we work through, you know, various things. One thing to keep in mind about our steel segment, Tristan, is you had $168 million of pre-operating startup costs. There are some companies that add that back into adjusted earnings, we do not. Those are cash charges. We always sort of play it where it lies on that basis. But if you look at the impact of those costs, those are startup costs that relate to the very large levels of capital spending we've had and continue to have. So if you're trying to normalize, you referenced some pre-COVID questions there.

Speaker Change: And we continue to kind of reaffirm that while we work through various things one thing to keep in mind about our steel segment. Tristan is you've got $168 million of pre operating startup costs.

Unknown Executive: There are some companies that add that back into adjusted earnings; we do not. Those are cash charges; we always sort of play it where it lies on that basis. But if you look at the impact of this cost, those are startup costs that relate to the very large levels of capital spending we've had and continued to have.

Speaker Change: Some companies that add that back into adjusted earnings we do not adjust for cash charges, we always sort of play it where it lies.

Speaker Change: On that basis, but.

Speaker Change: If you look at the impact of those cost those are start up costs that relate to the very large levels of capital spending.

Speaker Change: And continue to have so.

Unknown Executive: So if you're trying to normalize, you refer to some pre-COVID questions there. If you're trying to normalize some of that, you kind of need to take that factor back to your decline.

You are trying to normalize you referenced pre COVID-19 questions trying to normalize some of that you kind of need to take that factor factor into play.

Leon Topalian: If you're trying to normalize some of that, you kind of need to take that factor into play. That's helpful. And second question, a bit more bigger picture. You mentioned the higher carbon intensity of imports, and I believe there is an investigation for the US ITC on carbon intensity ongoing, and the report should be delivered in the coming months. So my question is simple. Do you believe there is room to see carbon-based tariffs in the US in 2025? Yeah, Tristan, look, I'm not the macro. The answer is yes, I do. I think you want to level the playing field and looking at what steels are making it onto the shores of the United States.

Tristan Gresser: That's helpful.

Speaker Change: That's helpful and second question a bit more bigger picture.

Tristan Gresser: And the second question a bit more, bigger picture. You mentioned the higher carbon intensity of imports. And I believe there is an investigation for the U.S. ITC on carbon intensity ongoing, and the report should be delivered in coming months. So my question is simple: do you believe there is room to see carbon-based tariffs in the U.S.

Speaker Change: You mentioned higher carbon intensity of imports.

Speaker Change: And I believe there is an investigation of the U S ITC on carbon intensity ongoing and the <unk>.

Speaker Change: <unk> should be delivered in coming months.

Speaker Change: My question is simple do you believe there is room to see carbon based tariffs in the U S. In 2025.

Unknown Executive: in 2025? Yeah, Tristan, look at the macro and the answers. Yes, I do. I think you want to level the playing field, and looking at what steel are making on and the shores of the United States, absolutely.

Speaker Change: Yes Tristan.

Speaker Change: The macro the answer is yes I do.

Speaker Change: I think you want to level, the playing field and looking at.

Speaker Change: What steels for making your on an assurance of United States, absolutely, but the Devil's in the details how does the carbon border adjustment mechanisms work, how does that get applied what gets included excluded.

Leon Topalian: Absolutely. But the devil's in the details. How does the carbon border adjustment mechanism work? How does that get applied? What gets included, excluded? And again, what I would tell you is the United States is the cleanest steel industry anywhere in the world. And if you're building future green technologies like wind and solar and, you know, advancing, you know, the I love where Nucor sits in relation to that. I love where our ability to offer a truly sustainable Product to our end-use customers that demand that, but I do think it is time to rationalize and recognize that many of the steels that are finding its ways into the United States are not anywhere close to the levels of carbon intensity that we can currently make and that we're going to continue to trade and develop as we move forward.

Unknown Executive: But the devil's in the details; how does the carbon border adjustment mechanism work? How does that get applied? What gets included executed? And again, what I would tell you is the United States is the cleanest steel industry anywhere in the world.

Speaker Change: Again.

Speaker Change: What I would tell you is the United States is the cleanest steel industry anywhere in the world and if you are building future Green technologies like wind and solar.

Unknown Executive: And if you're building future green technologies like wind and solar and advancing the digital economy with a dirty steel in the world, there's something fundamentally wrong with that. So again, I love new core states in relation to that. I love where our ability to offer a truly sustainable product to our and use customers that demand that, but I do think it is time to to rationalize and recognize that many of the steel that are finding its ways into the United States are not anywhere close to the levels of carbon intensity that we can currently make.

Speaker Change: Advancing.

Speaker Change: Alright.

Speaker Change: The digital economy with attorneys steels in the world there is something fundamentally wrong with that and so again I look.

Speaker Change: Nucor sits in relation to that I love, where.

Speaker Change: Our ability to offer a truly sustainable.

Speaker Change: Product to our end use customers that demand that and I do think it is time to rationalize and recognize that.

Speaker Change: Many of the steels that are finding its ways into the United States are not anywhere close to the levels of.

Speaker Change: Carbon intensity that we can currently make in that we're going to continue to trade.

Unknown Executive: And that we're going to continue to trade and develop as we move forward.

And develop as we move forward.

Gregory Murphy: And this is Greg Murphy. If I may add one thing, you know, we applaud the efforts of the ITC to try to gather meaningful data. What we really need is we need complete and total transparency if we're going to establish policy based on a quarter adjustment mechanism. And so Nucor is, of course, actively participating in that process. All right, perfect. Thank you very much. Thanks, Chris.

Greg Murphy: And this is Greg Murphy. If I may add one thing, you know, we applaud the efforts of the ITC to try to gather meaningful data.

Speaker Change: This is Greg Murphy, if I may add one thing we applaud the efforts of the ITC to try to gather meaningful data.

Gregory J. Murphy: What we really need is we need complete and total transparency if we're going to establish policy based on a quarter adjustment mechanism. And so new core is of course Act and we participate at process.

Speaker Change: What we really need is we need complete and total transparency, if we're going to establish policy based on that.

Speaker Change: Order adjustment mechanism and so nucor is of course actively participating.

Speaker Change: Yes.

Unknown Executive: All right, perfect. Thank you very much.

Speaker Change: Okay.

Speaker Change: Alright, perfect. Thank you very much.

Unknown Executive: Thank you, Roston.

Speaker Change: Thanks Kristen.

Carlos Alba: Your next question comes from the line of Carlos de Alba with Morgan Stanley. Please go ahead. Yeah, thank you very much. Good morning, everyone. So first question is, if you can offer a little bit more details on the few mil guidance for the fourth quarter, just not numerically, but just if you can you comment as you see more softness in the long steel products than in the flat steel products, any color would be will be helpful. Okay, Carlos. Yeah, I'll kick it off, Leon. You know, maybe ask Randy or Brad to comment on the longs.

Carlos Alba: Your next question comes from the line of Carlos the Alba with Morgan Stanley P2 head. Yeah, thank you very much. Good morning, everyone. So first question is, if you can offer a little more details on the field meal guidance for the fourth quarter, just, you know, not numerically, but just, you know, if you can you comment, do you see a more softness in the long steel products than in the flat steel products, you know, any color would be helpful.

Speaker Change: Your next question comes from the line of Carlos de Alba Morgan Stanley. Please go ahead.

Speaker Change: Yes. Thank you very much good morning, everyone. So first question is if you can offer a little bit more details on the steel mills guidance for the fourth quarter.

Speaker Change: Not numerically, but just.

Speaker Change: Can you comment.

Speaker Change: Do you see.

Speaker Change: More softness in the long steel products than in the flat steel products any color would be will be helpful.

Leon Topalian: Okay, Carlos, yeah, I'll take it off. Leon can, you know, maybe ask Randy, Brad to comment on the walls.

Speaker Change: Okay.

Speaker Change: Okay Carlos.

Speaker Change: I'll kick it off.

Speaker Change: Maybe ask Randy.

Speaker Change: Brad to comment on the logs.

Leon Topalian: But as we look at the backdrop of where our import levels were. You know, over the last year, it's just too high. Again, we applaud the Coors case, but there's others that need to continue to get refined as we've looked at, you know, you know, our NAFTA trading policies. We look at, you know, USMCA with Mexico, rebar imports out of Mexico are up 1,700% more than the averages of 2015 to 17. So again, those are meaningful additions to the overall marketplace. And again, you saw that reflected in our bar group pricing announcement to provide some transparency and relativity to the market.

Leon Topalian: But as we looked at the backdrop of where our important levels were, you know, over the last year, it's just too high. Again, we applaud the course case, but there's others that need to continue to get refined as we looked at, you know, you know, are now after trading policies. We look at, you know, USMCA with Mexico. We borrow; we borrow imports out of Mexico. We're up 17, 100% more than the averages of 2015 to 17. So again, there's a meaningful addition to the overall marketplace, and again, you saw that reflected in our bar group pricing announcement to provide some transparency and relativity to the market.

Speaker Change: As we look to the backdrop of where our import levels were.

Speaker Change: Over the last year.

Speaker Change: Hi, again, we applaud the course case, but there is others that need to continue to add to it.

Speaker Change: Refined as we looked at it.

Speaker Change: Our NAFTA trading policies, we look at U S MCA with Mexico, Rebar rebar imports out of Mexico were up 17% more than the averages of 2015 to 17, so again theres a meaningful.

Speaker Change: Additions to the overall marketplace and again you saw that reflected in our power group pricing announcement to provide some transparency.

Leon Topalian: However, as I say all that, man, the fundamentals and the demand picture aren't bad. They're really not. We're seeing some of our backlogs improve slightly, but, you know, historically, and we've shared this many times on this call, our longest products are the most consistent and reliable earning money, you know, generating businesses that we have. That continues to be the case, but they're not immune from some of that downward pressure. However, again, those prices are still, compared to pre-pandemic levels, much, much, much healthier than they were in what we saw, you know, not four or five, six years ago.

Leon Topalian: However, as I say all that, man, the fundamentals and the demand picture aren't bad. They're really not; we're seeing some of our backlogs approach slightly. But, you know, historically, and we share this many times on this call, our laws products are the most consistent, reliable, earning money, you know, generating businesses that we have. And that continues to be the case, but they're not immune from some of the downward pressure. However, again, those prices are still compared to pre-pandemic levels much, much, much healthier. Then they were, and what we saw, you know, not four or five, six years ago.

Speaker Change: Relativity the market however, as I say all that the fundamentals of the demand picture our bat really not we're seeing some of our backlogs improved slightly.

Speaker Change: But historically and we've shared this many times on this call are launched products are the most consistent and reliable, earning money generating businesses that we have that continues to be the case, but they are not immune from some of the downward pressure. However, again those prices are.

Speaker Change: Still compared to pre pandemic levels much much much healthier than they were and what we saw.

Randy: So. Yeah, look, again, demand picture wise isn't too far off, maybe one or 2% depending on specifics, but in the flow through of those pricing as we move from the bottom into a more sustainable market into the end of the year into 2025. Yeah, again, I think what Steve shared earlier is You can expect that those steel mill segment earnings are going to be all from Q3. But Randy or Brad, any comments you'd like to make on the longs? Yeah. Thanks, Leon. And thank you for the question. Leon covered it well. Obviously, what I would add to that, you know, certainly from a REBAR standpoint, we anticipate to sustain growth in that business propelled by the continued investment in our infrastructure, the reshoring of manufacturing, and as we would continue to see the energy transition and the transmission build out.

Speaker Change: It's 456 years ago so.

Leon J. Topalian: So, yeah, look, again, demand picture wise isn't too far off, maybe one or two percent depending on specific, but in the flow through of those pricing is we move from the bottom into a more sustainable market into the end of the year to 2025.

The outlook again demand picture wise isn't too far off maybe one or 2% depending on specifics, but the flow through of those pricing as we move from the bottom into a more sustainable.

Market into the end of the year into 2025.

Unknown Executive: Yeah, again, I think what Steve shared earlier is you can expect that those steel mill segment earnings are going to be all from Q3.

Speaker Change: Yes, again, I think what Steve shared earlier.

Speaker Change: You can expect that those steel mill segment earnings are going to be all from Q3, but Randy or Brad any comments you'd like to make on the launch yes. Thanks, Leon and thank you for the question.

Brad Ford: But, Randy, you're Brad. Any comments you'd like to make on the laws? Yeah, thanks, Leon, and thank you for the question. Leon covered it well, obviously. What I would add to that, you know, certainly from a rebar standpoint, we anticipate sustaining growth in that business, prepare and buy, to continue to invest in our infrastructure, reshoring of manufacturing, and as we would continue to see the energy transition and the transmission build-out. Keep in mind that, again, our long product, the most diverse long products portfolio of any steel company. There's more to get today from an MBQ standpoint that continue to be strong, whether it has an Iraqi manufacturer, metal buildings, trailing trailer manufacturing, all giving us orders and signs and demand, remains strong in advance manufacturing.

Speaker Change: Leon covered it well, obviously, what I would add to that.

Speaker Change: Certainly from a rebar standpoint, we anticipate sustained growth in that business powered by the continued investment in our infrastructure re shoring of manufacturing.

Speaker Change: We will continue to see the energy transition.

Speaker Change: And the transmission build out.

Randy: You know, keep in mind that again, our long product, the most diverse long products portfolio of any steel company. There's markets today from an MBQ standpoint that continue to be strong, whether that's our racking manufacturers, metal buildings, trailer manufacturing, all giving us orders and signs that demand remains strong in advanced manufacturing. So we remain very excited about the potential as we move into 2025, as we continue to see the interest rate cuts and the continued pace in that space that we are positioned well to take advantage of those opportunities. I can chime in on the structural side.

Speaker Change: Keep in mind that again, our loan product the most diverse.

Speaker Change: Vault products portfolio or if any any steel company.

Speaker Change: This market today from an <unk> standpoint that continues to be strong whether thats, a racking manufactured metal building trades.

Speaker Change: Trailing trailer manufacturing, all giving us orders and signs that demand remained strong and advanced manufacturing. So we remain very excited about the potential as we move into 2025 as we continue to see the.

Brad Ford: So, we remain very excited about the potential as we move into 2025, as we continue to see the interest rate cuts and the continued pace in that space. And that we are positioned well to take advantage of those opportunities.

Speaker Change: Interest rate cuts and the continued pace in that space that we are positioned well to take advantage of those opportunities.

Speaker Change: Okay.

Speaker Change: I can chime in on the structural side.

Randy: You know, demand and structural has been pretty resilient, year over year pretty flat. You know, obviously, the Slightly weaker in vertical construction and warehousing, but we're seeing a lot of strength in government work, schools, stadiums. Data Centers, Advanced Manufacturing Hospitals. So overall, ADC, pretty flat. The story is really imports, as Leon touched on, you know, white plant imports are up 23% year-over-year. Fabricated structural imports have more than doubled since 2020, and that's really where we're seeing pressure on prices. Carlos, this is Steve. One thing I just add to what the group's already said here is, and we mentioned this in our opening remarks, there's a certain amount of seasonality that affects longs and flats.

Speaker Change: Demand in structural has been pretty resilient year over year pretty flat.

Speaker Change: Obviously the.

Speaker Change: Slightly weaker in vertical construction and warehousing, but we're seeing a lot of strength in government work school stadiums data centers advanced manufacturing hospitals, so so overall ADC pretty flat.

Speaker Change: Storage really imports as Leon touched on.

Speaker Change: I pledge imports were up 23% year over year fabricated structural imports have more than doubled since since 2020.

Speaker Change: And that's really where we're seeing pressure on the pricing.

Speaker Change: Yes, Carlos Steve One thing I would just add to what the group's already set here.

Speaker Change: And we mentioned this in our opening remarks, there is a certain amount of seasonality.

Speaker Change: <unk> long term and flat and your question is about.

Steve Sumoski: Your question was about, you know, is it longs or flats? But, but other another thing to remember is that most of our sheet steel sales are on contract basis, So there is a certain lag effect. to when you see us have realized prices in our financial results versus changes that you might see in the market. Right, right. Thank you very much. And then, I don't know if you can, you mentioned that the order book for the steel products extends to the first quarter of next year. Any high level qualitative comments on the level of volumes, pricing or margin that you're seeing in that backlog?

Speaker Change: Net loss for flats, but.

Speaker Change: But other another thing to remember is that most of our sheet steel sales are on contract basis.

Speaker Change: There is a certain lag effect.

Speaker Change: Two.

Speaker Change: When you see.

Speaker Change: Realized prices in our financial results versus.

Speaker Change: Changes that you might see in the marketplace.

Speaker Change: Alright, great. Thank you very much and then I don't know if you can you mentioned that the order book for the steel products extends through the first quarter of next year.

Speaker Change: Any any high level qualitative comments on the level of volumes pricing or margin that youre seeing in that backlog.

Speaker Change: Yeah.

Carlos Alba: Yeah, Carlos, I'll ask John Hollatz to comment. And obviously, we're not going to touch on pricing, but we can give you a good picture into what we see end of the year and how Q1 shaping up and products. Yeah, Carlos, this is John. Thanks again for the question. Our downstream backlogs are nearly even with what they were in the third quarter. So we do expect that will carry us into the fourth quarter, I'm sorry, into the first quarter of 2025. We do expect we'll see a reduction in shipments as we move through the fourth quarter just due to the seasonality.

Speaker Change: Yes, Carlos I'll ask Scott to comment and obviously, we're not going to touch on pricing, but we can give you a good picture into what we see end of the year in our Q1 shaping up in products.

Speaker Change: Yes, Carlos this is John Thanks again for the question our downstream backlogs are nearly even.

Speaker Change: With what they were in the third quarter. So.

Speaker Change: Do you expect that will carry us into the fourth quarter I am sorry end of the first quarter of 2025, we do expect we will see a reduction in shipments.

Speaker Change: As we move through the fourth quarter, just due to the seasonality and keep in mind that geographically we have coverage all across North America. So as the weather changes, we feel the impact of that.

John Hollatz: And keep in mind that geographically, we have coverage all across North America. So as the weather changes, we feel the impact of that. And there'll be some margin compression just due to moderation in some of our market segments, as we mentioned in our opening comments. And one thing I think it's important to emphasize is that Nucor remains uniquely positioned as our downstream businesses pull through more than 20% of our overall steelmaking output, creates a baseload of demand for our own mills in addition to the earnings generated by our downstream businesses that a lot of our other competitors don't have that available.

Speaker Change: And there'll be some margin compression just due to a moderation in some of our markets market segments. As we mentioned in our opening comments and one thing I think it's important to emphasize is that <unk> remains uniquely positioned as our downstream businesses pull through more than 20% of our overall.

Speaker Change: Steelmaking output.

Speaker Change: It's a base load of demand for our own Mills in addition to the earnings.

Speaker Change: <unk> generated by our downstream business is that a lot of our.

Speaker Change: Other competitors don't have that available to them.

Carlos Alba: Thank you very much.

Speaker Change: Sure.

Speaker Change: Great. Thank you very much.

Speaker Change: Okay.

Alex Hacking: Your next question comes from the line of Alex Hacking with Citi. Please go ahead. Hey, thanks for the call. I guess first question, the 168 million of startup cuts in the quarter, is that exclusively in the mill segment? And can you give us a sense of how much of that relates to Brandenburg? Yeah, hey, Alex. Thanks for the question. This is Steve. And the overwhelming preponderance of costs there does relate to steel making. And I won't give you a specific number for Brandenburg, but it correlates to capital spending. No surprises to you there. And having just completed Brandenburg, it may not surprise you to know that that's the largest single driver in the number in the quarter.

Speaker Change: Yeah.

Speaker Change: Your next question comes from the line of Alex Hacking with Citi. Please go ahead.

Speaker Change: Hey, thanks for the call.

Speaker Change: I guess first question the $168 million of startup costs in the quarter.

Speaker Change: That exclusively in the mill segment and can you give us a sense of how much of that relates to Brandenburg.

Speaker Change: Yeah.

Speaker Change: Yeah, Hey, Alex Thanks for the question Steve.

The overwhelming preponderance of cost where it does relate to steelmaking.

Speaker Change: And.

Speaker Change: I won't give you a specific number for Brandenburg.

Speaker Change: Correlates to the capital spending no surprises there and having just completed Brandenburg It may not surprise you too.

Speaker Change: To know that that's the largest single driver in the number in the quarter.

Steve Sumoski: Between West Virginia and Brandenburg, those two divisions account for the vast majority, over three-fourths of the 168. Okay, thanks. And I apologize if I missed this earlier. But, you know, do you have any target for when Brandenburg is going to break even? And then just kind of a follow up on that on plate demand? What are you seeing on the wind farm side as we head into 2024? I know we've seen a lot of cancellations on offshore, but onshore appears to be stronger. Thanks. Yeah, we absolutely have targets, none of which we've shared publicly. But yeah, we absolutely have targets.

Speaker Change: Between West Virginia in Brandenburg those too.

Speaker Change: Two divisions, our account for the vast majority over over three fourths of the.

168%.

Speaker Change: Yes.

Speaker Change: Okay, Thanks, and I apologize if I missed this earlier, but.

Speaker Change: Do you have any target for when Brandenburg.

Speaker Change: Breakeven.

Speaker Change: And then just kind of a follow up on that on plate demand. What are you seeing on the wind farm side as we head into 2024.

Speaker Change: <unk> seen a lot of cancellations on offshore, but onshore appears to be stronger.

Speaker Change: Yes, we absolutely have targets, none of which we've shared publicly.

Brad Ford: What I would tell you, and Brad can add some more, and I don't think he mentioned this earlier, Alex, is Brandenburg has achieved EBITDA positive. So, you know, we are looking and will continue to look for that, as that the volumes increase. And again, the capability of that mill can provide an incredible backdrop of additions to our Hertford County and Tuscaloosa plate mills that, again, provide a really strong pull through, both the smaller sections in terms of thickness as well as the broader, but Brad, anything you'd add? Yeah, just for clarity, you know, we said on the last call we would achieve EBITDA break-even run rates by the end of the year.

Speaker Change: We absolutely have targets, what I would tell you and Brian can add some more.

Speaker Change: I don't think you mentioned this earlier Alex Steve.

Speaker Change: Brandenburg has achieved.

Speaker Change: EBITDA positive. So we are looking and we will continue to look for that is that the volumes increase again the capability of that mill.

Speaker Change: It provides an incredible backdrop.

Speaker Change: Additions to our Hertford County in Tuscaloosa pipe Mills again provide a really strong pull through.

Speaker Change: The smaller sections in terms of thickness as well as the broader but alright anything you'd add.

Speaker Change: Yes.

Clarity, we said on the last call we would achieve EBITDA.

Speaker Change: Given run rates by the end of the year.

Brad Ford: From a melt-and-cast perspective, from a rolling perspective, we actually achieved that in September. So we still are confident in achieving that more sustainably by year-end. I think your other part of your question was on wind. We are seeing pretty decent step-up in quoting activity and order activity for onshore wind. Offshore wind, as you know, supply chain in the U.S. hasn't materialized yet. That said, we are seeing interest from European offshore wind and monopile producers for Elsion plate out of Brandenburg. In fact, we received our first order for that in Q3. So we're excited about the opportunity to supply the European producers until that supply chain gets built out in the U.S.

Speaker Change: From a melton cast perspective from a rolling perspective, we actually achieved that in September. So we still are confident in achieving that.

Speaker Change: More sustainably by year end.

I think the other part of your question was on wind.

Speaker Change: We are seeing.

Speaker Change: Pretty decent step up in quoting activity and order activity.

Speaker Change: Onshore wind.

Speaker Change: Offshore wind as you know supply chain in the U S hasn't hasn't materialized yet.

Speaker Change: That said, we are seeing interest from from European.

Speaker Change: Offshore wind and monetize all producers for LCI and played out of Brandenburg. In fact received our first order for that in Q3. So we're excited about.

Speaker Change: The opportunity to supply the European producers until that supply.

Speaker Change: Supply chain gets built out in the U S.

Speaker Change: Thank you.

Brad Ford: Your next question comes from the line of Katja Jancic with BMO Capital Markets, please go ahead. Hi, thank you for taking my question. Starting on the CapEx, I think a few quarters ago you mentioned that in 2025 your CapEx spending will stay above $3 billion. Does that still hold or how should we think about CapEx next year? Hey Katja, this is Steve. Thanks for the thanks for the question. And we'll, you know, we'll do what we always do, which is give more precise quantitative guidance in the at the at the Q4 call. We do that every year because of the annual budget process that we have, which we're in right now.

Your next question comes from the line of Cotton yarns with.

Speaker Change: BMO capital markets. Please go ahead.

Speaker Change: Hi, Thank you for taking my question starting on the Capex I think a few quarters ago. You mentioned that 25. Your capex spending will stay above 3 billion is that does that still hold or how should we think about capex next year.

Speaker Change: Hey, Josh this is Steve thanks for the thanks for the question.

Steve Dakota: Well, we will do what we always do.

Steve Dakota: Just give more precise quantitative guidance in the at the.

Steve Dakota: Q4 call, we do that every year because of the annual budget process that we have which we're in right now.

Katja Jancic: But I think that If you look at the large capital projects that have been publicly announced that we talk very openly about, you can pencil in that we're going to remain at, you know, somewhere around that $3 billion level, maybe a little bit above it or around that for the next year or two. And that's just a function of those larger projects. But we'll give you we'll give you certainly more detailed color on that in in our next call. That's fair. And then, you know, given that you are, you have a couple of growth projects within your portfolio, are there any opportunities to maybe optimize the footprint?

Steve Dakota: I think that.

Steve Dakota: If you look at the large capital projects that have been publicly announced when we talked very openly about you can pencil and that we're going to remain at somewhere around that $3 billion level, maybe a little bit above at or around that for the next year or two and and Thats just.

Just a function of those larger projects.

Steve Dakota: We'll give you we'll give you certainly more detailed color on that in our next call.

Speaker Change: That's fair and then given that you are.

Speaker Change: You have a couple of growth projects with them.

Speaker Change: Then your portfolio are there any opportunities to maybe optimize the footprint maybe.

Steve Sumoski: Maybe, you know, reduce some of the older capacity? Well, Katja and Leon, what I would tell you is we we're always doing that we we have, you know, an incredible breadth of capability sets that provide the market what what it needs when it needs it. And so, you know, we're, we're, we're monitoring those trends. in watching where where's it best to produce certain products, but you know, it's not a We're not adding West Virginia because, you know, we're thinking in the years to come, we don't have or, you know, one of the sheet mills will get idle, that that's never how we think about growth.

Speaker Change: But some of the older <unk>.

Speaker Change: <unk>.

Speaker Change: Okay.

Speaker Change: Gotcha.

Speaker Change: I would tell you is we were always doing that.

Speaker Change: Half.

Speaker Change: An incredible breadth of capability sets that provide the market what it needs when it needs. It so.

Speaker Change: Our motto.

Speaker Change: Monitoring those trends.

Speaker Change: And watching where where is it best to produce certain products, but.

Speaker Change: It's not.

Speaker Change: We're not adding west Virginia, because we're thinking in the years to come we don't have or one of the sheet Mills will get idle that's never how do we think about growth.

Leon Topalian: It's what is the capability differentiator that we can supply into the markets. But, you know, in smaller moves, yeah, we were always internally rationalizing, where's the best footprint to produce a product? Where is the customer located? Do we save on freight? How do we best execute on the long term, you know, value added strategy that we have? So that's something that we always do. But it's not in the frame of, we're going to build X plant to close Y plant. That's never our mindset. Okay thank you. Thank you.

Speaker Change: The capability differentiator that we can supply into the market but.

Speaker Change: Smaller moves, yes, we're always internally rationalizing, whereas the best footprint to produce a product, whereas a customer located do we save on freight how do we best execute on the long term.

Speaker Change: Value added strategy that we have so it's something that we always do but it is not in the frame of.

Speaker Change: We're going to build a plant to close Wi plant, it's never our mindset.

Speaker Change: Okay. Thank you.

Speaker Change: Thank you.

Bill Peterson: Your next question comes from the line of Bill Peterson with J.P. Morgan. Please go ahead. Yeah, hi, good morning. And thanks for all the color and transparency on the opportunities as well as near term challenges. We're going to come back to fourth quarter seasonality for both mills and products. You know, considering some of the pauses you outlined before, I think in the last 10 years, maybe ex COVID, you seasonality would be like down 6% for mills, maybe down 10% for for products. Given these positives, should we assume that the magnitude could be larger than that?

Speaker Change: Your next question comes from the line of Bill Peterson with Jpmorgan. Please go ahead.

Speaker Change: Yes.

Bill Peterson: Yes, hi, good morning, and thanks for all the color and transparency on the opportunities as well as near term challenges I wanted to come back to fourth quarter seasonality for both mills and products.

Speaker Change: Hindering some of the pause that you outlined before I think in the last 10 years, maybe ex Covid, you seasonality would be like down 6% for metals, maybe down 10% for for products.

Speaker Change: Given these positive should we assume that the magnitude could be larger than that and then if so given this sort of a holding pattern.

Leon Topalian: And then if so, given the sort of holding pattern we're in, and looking at your order entry, can we think about maybe better than seasonal first quarter, given the comments that you had that the demand environment really isn't that bad fundamentally? You know, Bill, I'll touch on it. But certainly, you know, John, Randy, Brad, if there's some commentary you'd like to share. But, you know, look, that To answer your question, I'm going to speculate, and I don't want to speculate. I don't want to begin to predicting, well, if so-and-so gets an office and we see this tax relief or that trade policy, or what I would tell you is, no, we're not predicting seasonality to be any more severe than we did a year ago.

Speaker Change: Looking at your order entry can we think about maybe better than seasonal first quarter. Given the comments that you had with the demand environment really isn't that bad fundamentally.

Speaker Change: Okay.

Speaker Change: Bill.

I'll touch on it, but certainly John Randy Fred if theres, some commentary you'd like to share.

But we looked at.

To answer your question I'm going to speculate it.

Speaker Change: I don't want to speculate I don't want to begin the <unk>.

Speaker Change: Predicting well, if so and so it gets into office and we see this tax relief for that trade policy or is it.

Speaker Change: What I would tell you it's no we're not predicting seasonality to be any more severe than we did a year ago.

Leon Topalian: I think you would see a normalized seasonal response for Q4, you know, late part of the year into 2025. And then, again, there are some tailwinds that we know are going to come through. Timing of that, and I have to speculate. When do we see more meaningful infrastructure spending? When do we see more meaningful IRA spending flowing through the order books? And, again, I don't want to speculate. I would just tell you that that is yet to come. And, again, those packages are not insignificant. And what's the Fed do with rates? And do we see that continual easing to elicit more spending in the back half of the year and into early Q1?

Speaker Change: I think you would see a normalized.

Speaker Change: Seasonal response for Q4.

Speaker Change: Part of the year into 2025, and then again there are some.

Tailwind that we know we're going to come through timing of that.

Speaker Change: Speculate when do we see more meaningful infrastructure spending when do we see more meaningful IRA spending.

Speaker Change: Flowing through in the order books and again I don't want to speculate I would just tell you that.

<unk> is yet to come and again those packages are are not insignificant and whats the fed do with rates and do we see that continue easing to elicit more spending in the <unk>.

John Hollatz: Again, I think that's likely, but I don't want to speculate on percentages or volumes that we anticipate. Guys, anything you'd add to that? Yeah, Bill, this is John Hull. It's maybe one indicator of market stability that's specific to our choice in DECVS. For the last four quarters in a row, order entry rates across the industry have been very consistent. We feel like that market's in a stable spot, which should give some indicators that as we continue to see quote levels remain consistent as well, that gives us some confidence moving forward. But again, to Leon's comments, you don't want to get into speculation of things that are that far out right now.

Speaker Change: Half of the year and into early Q1.

Speaker Change: Again, I think that's likely.

Speaker Change: Don't want to speculate on.

Speaker Change: Percentages are volumes that we anticipate guys anything you'd add to that Bill. This is Sean how it's maybe one indicator of market stability, that's specific to our joist and deck businesses for the last four quarters in a row.

Speaker Change: Entry rates across the industry have been very consistent.

Speaker Change: We feel like that market.

Speaker Change: Stable spot, which should give saw some indicators that as we continue to see quality levels remain consistent as well gives us confidence moving forward, but again to <unk> comments, you don't want to get into speculation.

Thanks.

Speaker Change: That far out right now.

Leon Topalian: Yeah, thanks for that. Maybe tying to an earlier question on carbon intensity, especially in the context of imports, but I guess it's been a while since we've had an update from you on your own sort of decarbonization efforts. We've seen a push for nuclear energy, especially from, you know, data center operators. What's the status of your investments in nuclear with NuScale and maybe other forms of low carbon energy, your CCS program for the DRI plant, just things of that nature, if you could provide an update on these longer dated projects. Yeah, Bill, thanks for that.

Speaker Change: Yeah. Thanks, Thanks for that.

Speaker Change: Maybe kind of an earlier question on carbon intensity, especially in the context of imports, but I guess, it's been a while since you've had an update from you on your own sort of decarbonization efforts, we've seen a push for nuclear energy, especially from.

Data center operators, what's what's the status of your investments.

And nuclear with new scale, and maybe other forms of low carbon energy.

Speaker Change: <unk> program for the DIY plan.

Things of that nature, if you could provide an update on these longer dated projects.

Speaker Change: Yeah.

Leon Topalian: And again, I'll kick it off and maybe ask Greg to talk to some specifics. But look, the advantage of where Nucor sits is several fold, not the least of which, you know, having a carbon footprint today that is, you know, certainly best in class and Again, against a world backdrop from that standpoint. But again, as a leader, we also recognize we've got to lead from the front. We've got to lead with transparency. You know, we've got to do that in a way that shows our scope 1, 2, and 3 emissions that we are, again, transparent with that.

Speaker Change: Yes, bill thanks for that and again I'll kick it off and maybe ask Gregg to talk specifics, but look the advantage of our new course hits us.

Speaker Change: Several fold not the least of which having a carbon footprint today that is.

Speaker Change: Certainly best in class.

Speaker Change: And again against a volatile backdrop from.

That standpoint, but again as a leader we also recognize we've got a lead from the front, we've got to lead with transparency, we've got to do that in a way that shows our scope one two and three emissions that we are transparent with that Greg referenced it earlier in terms of the C band.

Leon Topalian: Greg referenced it earlier in terms of the CBAM and working with the administration. You want to level the playing field. You want to apply a meaningful border adjustment. You've got to do it with knowledge. And it can't be that somehow we look at, you know, the processes of integrated steelmaking to EAF. There is no comparison. We have such a market advantage in terms of our carbon footprint that, again, many of our end-use customers want, desire, and will continue. But, you know, the other piece of that is we look to the future. What drew Nucor into small investments in NuScale and Helion is the backdrop of energy.

Speaker Change: Working with the administration do you want to level the playing field do you want to play a meaningful border adjustment you've got to do it with knowledge and it can't be.

How we look at.

Speaker Change: The processes of integrated steelmaking to Etfs. There is no comparison, we have such a market advantage in terms of our carbon footprint that you get many of our end use customers want desire and will continue but the other piece of that as we look to the future.

Speaker Change: What drew nucor into small investments in new scale, and Helios isn't backdrop of energy energy is going to be required to rebuild this nation to green.

Leon Topalian: Energy is going to be required to rebuild this nation, to green this economy, to digitalize the economy. The demand, if you think about the data center pull-through, is absolutely breathtaking. And so we've got to do more than just wind and solar. And don't get me wrong, we need wind and solar to be successful. We just need nuclear along with that. And so our investment in NuScale is the backing of the small modular reactor technology, advanced nuclear technologies of tomorrow, that, again, are already commercialized in other parts of the world that need to be commercialized here in the United States.

Green this economy to digital IC economy that demand.

Speaker Change: Think about the data center pull through is absolutely breathtaking and so we've got to do more than just wind and solar and don't get me wrong, we need wind and solar to be successful, we just need nuclear along with that and so our investment in new scale is the backing of the small module reactor technology advanced nuclear technology.

Speaker Change: So tomorrow, then again are already commercialized in other parts of the world that need to be commercialized here in the United States again from fusion over watching with helium couldn't be more excited about them and what they are doing their technology and again how quickly they think they can bring that.

Gregory Murphy: Again, from fusion, what we're watching with Helion, couldn't be more excited about them and what they're doing, their technology, and, again, how quickly they think they can bring that. All that to say, as well, that part of those investments... enable us to build behind-the-meter stations within our Nucor plants. So again, while we don't want to make the electrons, that's never where we're going to be moving, the opportunity to consume those and then export the energy we're not using back to the grid creates a really enviable position for Nucor. And so again, we're going to stay very close to that.

Speaker Change: All that to say as well that part of those investments.

Speaker Change: Enable us to build behind the meter stations within our new more plants. So again, while we don't want to make the electrons thats never were were going to be moving.

Speaker Change: Pretty easy to consume knows and then export.

Speaker Change: Energy, we're not using back to the grid creates a really enviable position for new forward. So again, we're going to stay very close to that and we're going to watch how that continues to develop but it's the reason why you're seeing things like constellation and Microsoft announcing they're going to restart three mile Island demand in the energy <unk>.

Gregory Murphy: We're going to watch how that continues to develop. But it's the reason why you're seeing things like Constellation and Microsoft announcing they're going to restart Three Mile Island. The demand in the energy future is going to be insatiable. And so I think you're going to see a lot more of those investments in the future. But Greg, you want to touch on some of the specifics Bill asked? Yeah, no, I think that covers it really well in terms of our strategy. You know, Nucor's approach has always been very much a multifaceted approach. We start with a greenhouse gas intensity in all three scopes.

Speaker Change: <unk> is going to be insatiable, and so I think youre going to see a lot more of those investments.

Speaker Change: In the future, but Greg you want to touch on some of the specifics.

Greg Murphy: I think that covers it.

Greg Murphy: It really well in terms of our strategy.

Speaker Change: New course approach has always been a very much a multifaceted approach we start.

Speaker Change: With the greenhouse gas intensity and all three scopes, it's about a third of the <unk>.

Gregory Murphy: It's about a third of the global average for integrated steelmaking. So the real opportunities for us do lie in our raw material strategies and then also in our energy strategies. You know, our projects with NuScale and with Helion are certainly advancing, but some of the announcements recently by hyperscalers to invest in other small modular reactor technologies is also exciting because what we really need as a nation is we need to advance that technology in whatever form it takes. The other thing is, I think large-scale nuclear power definitely needs to be a part of our energy future.

Speaker Change: Global average for integrated steelmaking.

Speaker Change: So the real opportunities for us to lie in our raw material strategies and then also in our energy strategies.

Speaker Change: Our projects with <unk>.

Speaker Change: New scale and with Helios are certainly advancing.

Speaker Change: The announcements recently by Hyperscale or to invest in other small modular reactor technologies is also exciting because.

Speaker Change: What we really need as a nation as we need to advance that technology in whatever form it takes.

Speaker Change: The other thing is I think large scale nuclear power definitely needs to be a part of our energy future and some of the efforts to bring back online.

Gregory Murphy: And so the efforts to bring back online curtail nuclear power plants that are performing functionally well, and then the ability to sort of take the lessons learned from other large-scale nuclear reactor power plants, and then begin to build them out at scale and develop a very reliable supply chain, all those things are really going to be important. The last thing I would mention, because you asked about it, was our carbon capture project with ExxonMobil. We're still moving forward with that, full steam ahead. We're excited to actually get to the point where we're injecting CO2 from our DRI facility, our direct-reduced iron facility in Louisiana.

Speaker Change: Curtail nuclear power plants that are performing functionally well and then the ability to sort of take the lessons learned from other large scale nuclear reactor powerplant plants, and then begin to build the amount at scale and develop a very reliable supply chain all of those things are really going to be important.

Speaker Change: Last thing I would mentioned because you asked about it with our carbon capture project with Exxonmobil and we're still moving forward with that full steam ahead.

Speaker Change: We're excited to actually get to the point, where were injecting cotwo from our Cri facility, our direct reduced iron facility in Louisiana, and when we do that.

Gregory Murphy: And when we do that, we'll already take a very low-embodied carbon, high-quality metallic, and we'll reach the point where we have some of the lowest carbon raw materials available anywhere in the world today. If I could add just one more comment on that. You asked about... We're moving with that, or you wanted an update. We have a lot of irons and fires. And we just, not at this point, we can talk about those. So we are certainly pushing forward and doing what we can to green the grid. Thanks, everyone, for the comments. Thank you.

Take a very low embodied carbon high quality metallic and will reach the point, where we have some of the lowest carbon raw materials available anywhere in the world.

Speaker Change: But I could add just one more comment on that.

Speaker Change: You asked about.

Speaker Change: We're moving with that or if you wanted to.

Speaker Change: We have a lot of buyers and suppliers.

Speaker Change: Just.

Speaker Change: Not at this point, we can talk about those.

We are certainly push forward all we can.

Speaker Change: To create the grid.

Speaker Change: Okay. Thanks to everyone for the comments.

Leon Topalian: And that is all the time. Thank you, and that is all the time we have for questions. I would like to turn it back to Leon Topalian, our CEO, for closing remarks. Well, thank you so much for all the questions generated in the last hour. I want to leave you with this. Nucor continues to be a strong, resilient, growth focused company built for the long run. We've maintained an incredibly strong balance sheet, which allows us to proceed with long duration projects through every phase of the cycle. We're not operating with blinders on. We keep our fingers on the pulse, this dynamic industry and make necessary changes in response to changing circumstances, especially when it comes to our prudent capital allocation.

Speaker Change: Thank you and that is all the time.

Speaker Change: Thank you and that is all the time, we have for questions I would like to turn it back to beyond <unk>, our CEO for closing remarks.

Speaker Change: Well. Thank you so much for all the questions generated in the last hour I want to leave you with is Nucor continues to be a strong resilient growth focused company built for the long run.

Speaker Change: We maintain an incredibly strong balance sheet, which allows us to proceed with long duration projects through every phase of the cycle, we're not operating with blinders off keep our fingers on the pulse this dynamic industry and make necessary changes in response to changing circumstances, especially when it comes to a prudent capital allocation.

Leon Topalian: That's what built Nucor into the largest and most diversified steel producer in North America and is what will continue to keep us out front for decades to come. Closing, I want to thank our Nucor team, customers and shareholders for the trust you place in us. And thanks for taking the time to join us this morning. Look forward to connecting again soon. Thank you.

Speaker Change: Nucor is the largest and most diversified steel producer in North America and is what we'll continue to keep us out front for decades to come closing I want to thank our nucor team customers and shareholders for the trust you place in us and thanks for taking the time to join US This morning, and look forward to connecting again soon.

Unknown Executive: And ladies and gentlemen, this concludes today's conference call. Thank you all for participating. You may now disconnect.

Unknown Executive: Ladies and gentlemen, this concludes today's conference call. Thank you all for participating. You may now have a good day.

Speaker Change: Thank you ladies and gentlemen. This concludes today's conference call. Thank you all for participating you may now disconnect.