Steel Dynamics, Inc. (NASDAQ/GS: STLD) has announced its fourth quarter and full year 2024 earnings conference call and webcast, scheduled for January 23, 2025. The company, one of the largest domestic steel producers and metals recyclers in North America, will release its financial results after market close on January 22, 2025. This article explores the key factors driving Steel Dynamics' earnings and the trends investors should watch for during the earnings call.



Steel Dynamics' earnings have been driven by its steel operations, metals recycling operations, and steel fabrication operations. In the third quarter of 2024, the company reported net sales of $4.3 billion and net income of $318 million, or $2.05 per diluted share. Comparatively, the company's sequential third quarter 2024 earnings were $2.05 per diluted share, and prior year fourth quarter earnings were $2.61 per diluted share.



The company's steel operations contributed $305 million to the company's operating income in the third quarter of 2024, lower than the sequential quarter due to lower average realized steel pricing and scrap costs declining more than scrap prices. The company's Sinton Texas Flat Roll Steel Mill team completed changes to gain full access to its melting capacity, which is expected to increase production utilization from 60% in the first half of 2024 to approximately 75% in the second half, with full availability in 2025.



Metals recycling operations contributed $12 million to the company's operating income in the third quarter of 2024, lower than the sequential quarter due to softer demand, scheduled maintenance outages at domestic steel mills, and an unexpected unrealized, non-cash copper hedging loss of $10 million. In the second quarter of 2024, metals recycling operations contributed $32 million to the company's operating income, a 42% increase from the sequential first quarter, based on increased demand supporting higher volume and expanded metal spread.



Steel fabrication operations contributed $166 million to the company's operating income in the third quarter of 2024, modestly lower than the sequential second quarter due to steady demand and a five percent decline in average realized pricing. The order backlog was steady, extending into the first quarter of 2025 at attractive pricing levels, with current order activity steady and expectations for improved volumes in 2025.

As Steel Dynamics prepares to release its fourth quarter and full year 2024 earnings, investors should pay close attention to the following key metrics:

1. Earnings per Share (EPS): The company's EPS guidance for the fourth quarter 2024 is in the range of $1.26 to $1.30 per diluted share, significantly lower than the sequential third quarter 2024 EPS of $2.05 and the prior year fourth quarter EPS of $2.61.
2. Operating Income: Investors should analyze the operating income for each of the company's segments: steel operations, metals recycling operations, and steel fabrication operations. The company expects fourth quarter 2024 profitability from its steel operations to be meaningfully lower than sequential third quarter results, while earnings from metals recycling operations are expected to be significantly higher. Earnings from steel fabrication operations are expected to be lower than sequential third quarter results.
3. Revenue: Investors should examine the company's net sales for the fourth quarter 2024 and compare it to the sequential third quarter 2024 and the prior year fourth quarter.
4. Cash Flow from Operations (CFO): Investors should analyze the CFO for the fourth quarter 2024 and compare it to the sequential third quarter 2024 and the prior year fourth quarter.
5. Liquidity: Investors should examine the company's liquidity position as of December 31, 2024, and compare it to the liquidity position as of September 30, 2024.

By focusing on these key financial metrics, investors can gain a better understanding of Steel Dynamics' financial performance and make more informed investment decisions. As the company's earnings call approaches, investors should stay tuned for updates on the company's performance and outlook for the future.