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Steel Dynamics reports record 2018 results

Steel Dynamics Inc. (SDI), Fort Wayne, Indiana, has announced fourth quarter and annual 2018 financial results, noting that it saw annual steel shipments of 10.6 million tons, net sales of $11.8 billion, operating income of $1.7 billion, net income of $1.3 billion, cash flow from operations of $1.4 billion and earnings before interest, taxes, depreciation and amortization (EBITDA) in excess of $2 billion, all annual records.

The company reported fourth quarter 2018 net sales of $2.9 billion and net income of $270 million, or $1.17 per diluted share. The company’s fourth quarter adjusted net income was $302 million, or $1.31 per diluted share.

Comparatively, prior year fourth-quarter net sales were $2.3 billion, with net income of $305 million, or $1.28 per diluted share, which included a tax benefit of 83 cents per diluted share primarily related to the U.S. Federal Tax Cuts and Jobs Act of 2017 (TCJA), lower earnings from facility outages of 7 cents per diluted share and debt refinancing charges of 2 cents per diluted share. Sequential third-quarter 2018 net sales were $3.2 billion, with net income of $398 million, or $1.69 per diluted share.

“The performance of the entire Steel Dynamics team was exceptional this year,” says Mark D. Millett, SDI president and CEO in the news release announcing its financial performance. “We performed at the top of our industry, both operationally and financially.”

Millett says in 2018, the U.S. steel industry benefited from steady improvement in steel consumption fueled by strength from the automotive, construction and energy sectors.

Fourth-quarter 2018 operating income from its metals recycling operations was $17 million compared with $18 million in the sequential third quarter. Improved average quarterly ferrous and nonferrous metal spreads were offset by seasonally lower ferrous scrap shipments, SDI says.

“In combination with our existing and newly announced expansion initiatives, we believe there are firm drivers for our continued growth,” Millett says. “We are excited about our new planned flat roll steel mill that was announced in the fourth quarter and the anticipated long-term value creation it will bring through geographic and value-added product diversification.”

See http://bit.ly/sdi-financials for additional details.

Florida scrap metal firm expands

Capital Scrap Metal LLC, headquartered in Pompano Beach, Florida, has purchased a new facility that will incorporate the company’s new headquarters building and provide additional warehousing space.

The new facility is adjacent to Capital Scrap Metal’s flagship yard in Pompano Beach. The company operates five locations throughout south Florida.

“This building will enable us to increase our nonferrous processing and consolidate our administrative staff into one location,” General Manager Sean Harrigan says. “The overall objective, as always, will be enhancing our efficiencies and creating the highest quality package for shipping.”

The company, which recently celebrated its 10th anniversary, says it is pursuing additional opportunities and locations in 2019.

© Marty Haas / stock.adobe.com

Detroit to place moratorium on scrap yard, auto salvage permits

Detroit Mayor Mike Duggan has signed an executive order that bans the opening of “used tire storage and sales, used auto sales, scrap iron and metal processors, junk dealers, auto dismantling and wrecking and major and minor auto repair” facilities. The executive order runs from April 1, 2019, to March 31, 2020.

According to the executive order, Detroit has seen an increase in the establishment and expansion of scrap tire processing and recycling, scrap tire storage and motor vehicle repair facilities and used car sales lots. The order states that such businesses have “been a challenge for the city of Detroit due to an overconcentration of such uses and lack of compliance with zoning, property maintenance and licensing standards, in addition to evidence of criminal activity furthered or condoned by some of these operations.”

The order adds that some businesses are operating without permits, certificates of compliance or business licenses and “present deleterious effects on neighboring residential districts, resulting in excessive blight, traffic, noise, crime and environmental concerns.”

According to the executive order, the city plans to spend the year reviewing and updating its existing ordinances for starting and expanding scrap yards and auto dismantling facilities to reduce crime that comes as a result of these businesses and to limit the number of these businesses in the city.

“Many businesses are currently operating without the benefit of a permit, a certificate of compliance or a business license,” the order states. “Once permitted, some of these uses have illegally intensified the services offered, such as presenting more used cars for sale than allowed or providing more intense vehicle repair activities than allowed.”

The order will not prohibit the renewal of existing business licenses or certificates of compliance required by the city code.

Waelz kiln to open in Indiana

Waelz Sustainable Products LLC plans to build a waelz kiln in Muncie, Indiana. The company is a joint venture between Heritage Environmental Services LLC, Indianapolis, and Zinc Nacional, Monterrey, Mexico, which formed in August 2018.

According to an Inside INdianaBusiness article, Waelz Sustainable Products plans to invest $75 million in a 30-acre kiln facility at the former BorgWarner campus in Muncie. The project is expected to create about 90 jobs over the next few years.

The publication reports Waelz Sustainable Products plans to break ground early this year and to be operating by late 2020. It will produce zinc oxide from steel mill byproducts, processing 100,000 tons annually.