Nucor Reports 78% Drop in Third-Quarter Profit

(Reuters) – Nucor (NYSE:NUE) reported a nearly 78% slump in third-quarter profit on Monday due to impairment charges related to its steel products and raw materials businesses. This news caused its shares to decline by 3% after hours.

U.S. steelmakers are facing a sluggish pricing environment, as distributors are holding back on purchases beyond immediate inventory needs due to an oversupply issue.

Nucor anticipates a further sequential decline in fourth-quarter net earnings in its steel mills and products segments.

The company reported a quarterly profit of roughly $250 million, or $1.05 per share, in the third quarter, factoring in impairment charges of $123 million. Excluding these items, the steelmaker earned $1.49 per share, surpassing the average analyst estimate of $1.47, according to data compiled by LSEG.

Revenue dropped over 15% to $7.44 billion, as the company struggled with weak prices and soft demand, compared to estimates of $7.28 billion.

The average sales price per ton in the third quarter decreased by 6% from the second quarter and 15% from a year earlier.

Last month, the North Carolina-based company had forecasted third-quarter profit to range between $1.30 and $1.40 per share.