THIRD
QUARTER
1999
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR QUARTER ENDED OCTOBER 2, 1999 COMMISSION FILE NUMBER 1-4119
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NUCOR CORPORATION
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(EXACT NAME AS SPECIFIED IN CHARTER)
DELAWARE 13-1860817
-------------------------------- -----------------
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
2100 REXFORD ROAD, CHARLOTTE, NORTH CAROLINA 28211
- --------------------------------------------- ------------------------------
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
TELEPHONE NUMBER, INCLUDING AREA CODE: (704) 366-7000
------------------------------
INDICATION BY CHECK MARK WHETHER NUCOR CORPORATION (1) HAS FILED ALL REPORTS
REQUIRED TO BE FILED BY SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF
1934 DURING THE PRECEDING TWELVE MONTHS, AND (2) HAS BEEN SUBJECT TO SUCH FILING
REQUIREMENTS FOR THE PAST 90 DAYS: YES X NO
--- ---
87,213,262 SHARES OF COMMON STOCK WERE OUTSTANDING AT OCTOBER 2, 1999.
- 1 -
<PAGE>
PART I - FINANCIAL INFORMATION
NUCOR CORPORATION - CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS
<TABLE>
<CAPTION>
NINE MONTHS (39 WEEKS) ENDED THREE MONTHS (13 WEEKS) ENDED
---------------------------- -----------------------------
OCT. 2, 1999 OCT. 3, 1998 OCT. 2, 1999 OCT. 3, 1998
------------- ------------ ------------ -------------
(UNAUDITED) (UNAUDITED) (UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C>
NET SALES................... $2,917,677,212 $3,278,173,618 $1,026,687,893 $1,010,961,380
-------------- -------------- -------------- --------------
COSTS AND EXPENSES:
COST OF PRODUCTS SOLD..... 2,579,603,978 2,845,263,175 876,327,900 869,452,694
MARKETING, ADMINISTRATIVE
AND OTHER EXPENSES...... 110,695,119 119,581,871 45,643,099 40,632,470
INTEREST EXPENSE (INCOME). (2,204,456) (3,060,864) (1,745,072) (949,697)
-------------- -------------- -------------- --------------
2,688,094,641 2,961,784,182 920,225,927 909,135,467
-------------- -------------- -------------- --------------
EARNINGS BEFORE
FEDERAL INCOME TAXES...... 229,582,571 316,389,436 106,461,966 101,825,913
FEDERAL INCOME TAXES...... 82,600,000 113,900,000 38,300,000 36,700,000
-------------- -------------- -------------- --------------
NET EARNINGS............ $ 146,982,571 $ 202,489,436 $ 68,161,966 $ 65,125,913
============== ============== ============== ==============
NET EARNINGS PER SHARE...... $1.68 $2.30 $.78 $.74
===== ===== ==== ====
DIVIDENDS DECLARED
PER SHARE............... $.39 $.36 $.13 $.12
==== ==== ==== ====
AVERAGE NUMBER OF
SHARES OUTSTANDING.... 87,295,726 88,000,181 87,289,209 87,914,877
</TABLE>
THE INFORMATION FURNISHED REFLECTS ALL ADJUSTMENTS THAT ARE, IN THE
OPINION OF MANAGEMENT, NECESSARY TO A FAIR STATEMENT OF THE RESULTS FOR THE
INTERIM PERIODS.
THE INFORMATION FURNISHED HAS NOT BEEN AUDITED AND IS SUBJECT TO
YEAR-END ADJUSTMENTS.
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<PAGE>
NUCOR CORPORATION - CONSOLIDATED CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
OCTOBER 2, DECEMBER 31,
1999 1998
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ASSETS (UNAUDITED) (AUDITED)
CURRENT ASSETS:
<S> <C> <C>
CASH AND SHORT-TERM INVESTMENTS................. $ 598,982,078 $ 308,696,460
ACCOUNTS RECEIVABLE............................. 357,203,753 299,244,794
INVENTORIES..................................... 398,804,133 435,884,838
OTHER CURRENT ASSETS............................ 86,526,122 85,641,291
-------------- --------------
TOTAL CURRENT ASSETS.......................... 1,441,516,086 1,129,467,383
-------------- --------------
PROPERTY, PLANT AND EQUIPMENT..................... 2,113,096,749 2,097,078,473
-------------- --------------
TOTAL ASSETS.................................. $3,554,612,835 $3,226,545,856
============== ==============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
ACCOUNTS PAYABLE................................ $ 221,187,345 $ 198,329,771
SALARIES, WAGES AND RELATED ACCRUALS............ 132,980,920 113,619,322
FEDERAL INCOME TAXES............................ 33,272,539 26,090,271
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES.. 196,198,551 148,857,793
-------------- --------------
TOTAL CURRENT LIABILITIES..................... 583,639,355 486,897,157
-------------- --------------
LONG-TERM DEBT DUE AFTER ONE YEAR................. 390,450,000 215,450,000
-------------- --------------
DEFERRED CREDITS AND OTHER LIABILITIES............ 147,764,449 169,250,449
-------------- --------------
MINORITY INTERESTS................................ 253,598,798 282,396,469
-------------- --------------
STOCKHOLDERS' EQUITY:
COMMON STOCK.................................... 36,038,230 36,020,714
ADDITIONAL PAID-IN CAPITAL...................... 69,024,713 67,252,936
RETAINED EARNINGS............................... 2,129,812,481 2,016,856,168
TREASURY STOCK.................................. (55,715,191) (47,578,037)
-------------- --------------
2,179,160,233 2,072,551,781
-------------- --------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY.... $3,554,612,835 $3,226,545,856
============== ==============
</TABLE>
INVENTORIES CONSISTED OF APPROXIMATELY 45% RAW MATERIALS AND SUPPLIES, AND 55%
FINISHED AND SEMI-FINISHED PRODUCTS, AT OCTOBER 2, 1999 (50% AND 50% AT DECEMBER
31, 1998). INVENTORIES VALUED ON THE LAST-IN, FIRST-OUT (LIFO) METHOD OF
ACCOUNTING REPRESENT APPROXIMATELY 90% OF TOTAL INVENTORIES AS OF OCTOBER 2,
1999 (85% AS OF DECEMBER 31, 1998). IF THE FIRST-IN, FIRST-OUT METHOD (FIFO) OF
ACCOUNTING HAD BEEN USED, INVENTORIES WOULD HAVE BEEN $30,170,960 HIGHER AT
OCTOBER 2, 1999 ($5,120,960 HIGHER AT DECEMBER 31, 1998).
THE INFORMATION FURNISHED HAS NOT BEEN AUDITED AND IS SUBJECT TO YEAR-END
ADJUSTMENTS.
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<PAGE>
NUCOR CORPORATION - CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
NINE MONTHS (39 WEEKS) ENDED
----------------------------
OCT. 2, 1999 OCT. 3, 1998
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(UNAUDITED) (UNAUDITED)
OPERATING ACTIVITIES:
<S> <C> <C>
NET EARNINGS............................................ $146,982,571 $202,489,436
ADJUSTMENTS:
DEPRECIATION OF PLANT AND EQUIPMENT................... 191,624,257 178,455,588
MINORITY INTERESTS.................................... 50,490,209 71,838,035
CHANGES IN:
CURRENT ASSETS...................................... (21,763,085) (29,153,219)
CURRENT LIABILITIES................................. 96,742,198 26,247,914
OTHER............................................... (20,804,992) (9,173,379)
------------ ------------
CASH PROVIDED BY OPERATING ACTIVITIES................. 443,271,158 440,704,375
------------ ------------
INVESTING ACTIVITIES:
CAPITAL EXPENDITURES (NET).............................. (208,323,541) (363,393,228)
------------ ------------
CASH USED IN INVESTING ACTIVITIES..................... (208,323,541) (363,393,228)
------------ ------------
FINANCING ACTIVITIES:
INCREASE IN LONG-TERM DEBT.............................. 175,000,000 47,250,000
DISTRIBUTIONS TO MINORITY INTERESTS..................... (79,287,880) (85,682,559)
ISSUANCE OF COMMON STOCK................................ 2,490,011 3,516,586
ACQUISITION OF TREASURY STOCK........................... (8,837,872) (19,846,062)
CASH DIVIDENDS.......................................... (34,026,258) (31,647,184)
------------ ------------
CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES....... 55,338,001 (86,409,219)
------------ ------------
INCREASE (DECREASE) IN CASH AND SHORT-TERM INVESTMENTS.... $290,285,618 $ (9,098,072)
============ ============
</TABLE>
THE INFORMATION FURNISHED HAS NOT BEEN AUDITED AND IS SUBJECT TO YEAR-END
ADJUSTMENTS.
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<PAGE>
NUCOR CORPORATION - ANALYSIS OF OPERATIONS AND FINANCES
OPERATIONS
NET SALES INCREASED BY ABOUT 2% FROM THE THIRD QUARTER OF 1998 TO THE THIRD
QUARTER OF 1999, WITH THE INCREASE RESULTING FROM AN INCREASE IN SALES VOLUME,
PARTIALLY OFFSET BY A DECREASE IN AVERAGE SALES PRICES. NET SALES DECREASED BY
11% FROM THE FIRST NINE MONTHS OF 1998 TO THE FIRST NINE MONTHS OF 1999,
PRIMARILY AS A RESULT OF A DECREASE IN SALES PRICE. AVERAGE SALES PRICES
DECREASED BY APPROXIMATELY 8% FROM THE THIRD QUARTER OF 1998 TO THE THIRD
QUARTER OF 1999, AND DECREASED MORE THAN 10% FROM THE FIRST NINE MONTHS OF 1998
TO THE FIRST NINE MONTHS OF 1999.
THE MAJOR COMPONENT OF COST OF PRODUCTS SOLD IS RAW MATERIAL COSTS. THE
AVERAGE PRICE OF RAW MATERIALS DECREASED APPROXIMATELY 20% FROM THE THIRD
QUARTER OF 1998 TO THE THIRD QUARTER OF 1999, AND DECREASED ABOUT 23% FROM THE
FIRST NINE MONTHS OF 1998 TO THE FIRST NINE MONTHS OF 1999.
MAJOR COMPONENTS OF MARKETING, ADMINISTRATIVE AND OTHER EXPENSES ARE FREIGHT
AND PROFIT SHARING COSTS. UNIT FREIGHT COSTS INCREASED LESS THAN 5% FROM THE
THIRD QUARTER OF 1998 TO THE THIRD QUARTER OF 1999, AND WERE UNCHANGED FROM THE
FIRST NINE MONTHS OF 1998 TO THE FIRST NINE MONTHS OF 1999. PROFIT SHARING COSTS
INCREASED ABOUT 5% FROM THE THIRD QUARTER OF 1998 TO THE THIRD QUARTER OF 1999,
AND DECREASED ABOUT 30% FROM THE FIRST NINE MONTHS OF 1998 TO THE FIRST NINE
MONTHS OF 1999. PROFIT SHARING COSTS ARE BASED UPON AND GENERALLY FLUCTUATE WITH
PRE-TAX EARNINGS.
INTEREST INCOME, NET OF INTEREST EXPENSE, INCREASED FROM THE THIRD QUARTER
OF 1998 TO THE THIRD QUARTER OF 1999, DUE PRIMARILY TO INCREASED AVERAGE
SHORT-TERM INVESTMENTS, AND DECREASED FROM THE FIRST NINE MONTHS OF 1998 TO THE
FIRST NINE MONTHS OF 1999, AS A RESULT OF INCREASED LONG-TERM DEBT.
FEDERAL INCOME TAXES WERE AT A RATE OF ABOUT 36% FOR THE THIRD QUARTER AND
FIRST NINE MONTHS OF 1999, AND THE THIRD QUARTER AND FIRST NINE MONTHS OF 1998.
NET EARNINGS INCREASED FROM THE THIRD QUARTER OF 1998 TO THE THIRD QUARTER
OF 1999 PRIMARILY DUE TO INCREASED VOLUME AND DECREASED PRE-OPERATING AND
START-UP COSTS OF NEW FACILITIES, AND DECREASED FROM THE FIRST NINE MONTHS OF
1998 TO THE FIRST NINE MONTHS OF 1999 DUE TO DECREASED MARGINS AND INCREASED
PRE-OPERATING AND START-UP COSTS OF NEW FACILITIES.
MARGINS WERE ABOUT 15% FOR THE THIRD QUARTER OF 1999 AND ABOUT 12% FOR THE
FIRST NINE MONTHS OF 1999, COMPARED WITH ABOUT 14% FOR THE THIRD QUARTER OF 1998
AND ABOUT 13% FOR THE FIRST NINE MONTHS OF 1998.
LIQUIDITY AND CAPITAL RESOURCES
THE CURRENT RATIO WAS ABOUT 2.5 AT THE END OF THE FIRST NINE MONTHS OF 1999,
AND AT ABOUT 2.3 AT YEAR-END 1998. THE PERCENTAGE OF LONG-TERM DEBT TO TOTAL
CAPITAL WAS CLOSE TO 14% AT THE END OF THE FIRST NINE MONTHS OF 1999, AND ABOUT
8% AT YEAR-END 1998.
CAPITAL EXPENDITURES DECREASED CLOSE TO 40% DURING THE FIRST NINE MONTHS OF
1999, COMPARED WITH THE FIRST NINE MONTHS OF 1998. CAPITAL EXPENDITURES ARE
PROJECTED TO BE ABOUT $400 MILLION FOR ALL OF 1999. FUNDS PROVIDED FROM
OPERATIONS, EXISTING CREDIT FACILITIES, AND NEW LONG-TERM DEBT ARE EXPECTED TO
BE MORE THAN ADEQUATE TO MEET FUTURE CAPITAL EXPENDITURE AND WORKING CAPITAL
REQUIREMENTS.
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<PAGE>
YEAR 2000 (Y2K)
NUCOR HAS IMPLEMENTED A READINESS PROGRAM DESIGNED TO HAVE ALL SIGNIFICANT
BUSINESS AND MANUFACTURING SYSTEMS FUNCTIONING PROPERLY WITH RESPECT TO THE Y2K
ISSUE. AFFECTED SYSTEMS ARE BEING REPLACED OR REMEDIATED, WITH TESTING PERFORMED
CONCURRENTLY. MOST MISSION-CRITICAL SYSTEMS HAVE BEEN REMEDIATED AND TESTED,
WITH THE REMAINDER TO BE COMPLETED BY THE END OF 1999. NUCOR IS ALSO REVIEWING
THE PROGRESS OF SIGNIFICANT VENDORS AND CUSTOMERS IN ADDRESSING THIS ISSUE.
FAILURE BY NUCOR OR ITS VENDORS AND CUSTOMERS TO MAKE MATERIAL CORRECTIONS COULD
RESULT, IN SOME CIRCUMSTANCES, IN AN INTERRUPTION OF NORMAL BUSINESS OPERATIONS.
NUCOR HAS DEVELOPED INTERNAL GUIDELINES FOR BUSINESS CONTINUITY PLANNING AND HAS
DEVELOPED MITIGATION, CONTINGENCY AND RECOVERY PLANS.
PART II - OTHER INFORMATION
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
EXHIBIT 11 - COMPUTATION OF NET EARNINGS PER SHARE.
REPORTS ON FORM 8-K - NONE FILED FOR THE QUARTER.
EXHIBIT 11 - COMPUTATION OF NET EARNINGS PER SHARE
<TABLE>
<CAPTION>
NINE MONTHS (39 WEEKS) ENDED THREE MONTHS (13 WEEKS) ENDED
---------------------------- -----------------------------
OCT. 2, 1999 OCT. 3, 1998 OCT. 2, 1999 OCT. 3, 1998
------------- ------------ ------------ ------------
(UNAUDITED) (UNAUDITED) (UNAUDITED) (UNAUDITED)
BASIC:
<S> <C> <C> <C> <C>
BASIC NET EARNINGS............. $146,982,571 $202,489,436 $68,161,966 $65,125,913
============ ============ =========== ===========
AVERAGE SHARES OUTSTANDING..... 87,295,726 88,000,181 87,289,209 87,914,877
========== ========== ========== ==========
BASIC NET EARNINGS PER SHARE... $1.6837 $2.3010 $.7809 $.7408
======= ======= ====== ======
DILUTED:
DILUTED NET EARNINGS........... $146,982,571 $202,489,436 $68,161,966 $65,125,913
============ ============ =========== ===========
DILUTED
AVERAGE SHARES OUTSTANDING:
BASIC SHARES OUTSTANDING..... 87,295,726 88,000,181 87,289,209 87,914,877
DILUTIVE EFFECT OF
EMPLOYEE STOCK OPTIONS..... 37,552 17,633 33,772 9,643
---------- ---------- ---------- ----------
87,333,278 88,017,814 87,322,981 87,924,520
========== ========== ========== ==========
DILUTED NET EARNINGS PER SHARE. $1.6830 $2.3006 $.7806 $.7407
======= ======= ====== ======
</TABLE>
THE INFORMATION FURNISHED HAS NOT BEEN AUDITED AND IS SUBJECT TO
YEAR-END ADJUSTMENTS.
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934,
NUCOR CORPORATION HAS DULY CAUSED THIS REPORT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, WHO IS (1) A DULY AUTHORIZED OFFICER, AND (2) THE PRINCIPAL
ACCOUNTING OFFICER.
NUCOR CORPORATION
BY:______________________________
TERRY S. LISENBY
VICE PRESIDENT,
DATED: NOVEMBER 11, 1999 CORPORATE CONTROLLER
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<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> OCT-02-1999
<CASH> 598,982,078
<SECURITIES> 0
<RECEIVABLES> 357,203,753
<ALLOWANCES> 18,573,366
<INVENTORY> 398,804,133
<CURRENT-ASSETS> 1,441,516,086
<PP&E> 3,605,534,465
<DEPRECIATION> 1,492,437,716
<TOTAL-ASSETS> 3,554,612,835
<CURRENT-LIABILITIES> 583,639,355
<BONDS> 390,450,000
0
0
<COMMON> 36,038,230
<OTHER-SE> 2,143,122,003
<TOTAL-LIABILITY-AND-EQUITY> 3,554,612,835
<SALES> 2,917,677,212
<TOTAL-REVENUES> 2,917,677,212
<CGS> 2,579,603,978
<TOTAL-COSTS> 2,579,603,978
<OTHER-EXPENSES> 110,695,119
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (2,204,456)
<INCOME-PRETAX> 229,582,571
<INCOME-TAX> 82,600,000
<INCOME-CONTINUING> 146,982,571
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 146,982,571
<EPS-BASIC> 1.68
<EPS-DILUTED> 1.68
</TABLE>
