nue-10q_20201003.htm
false
2020
Q3
0000073309
--12-31
P55Y
P55Y
2020-07-27
P1M
P1M
0000073309
2020-01-01
2020-10-03
xbrli:shares
0000073309
2020-10-03
iso4217:USD
0000073309
2020-07-05
2020-10-03
0000073309
2019-06-30
2019-09-28
0000073309
2019-01-01
2019-09-28
iso4217:USD
xbrli:shares
0000073309
2019-12-31
0000073309
2018-12-31
0000073309
2019-09-28
xbrli:pure
0000073309
nue:CarryingValueOfTheOneFieldOfWellsMember
2019-09-29
2019-12-31
0000073309
nue:CarryingValueOfTheOneFieldOfWellsMember
2020-10-03
0000073309
nue:CarryingValueOfTheOneFieldOfWellsMember
2019-12-31
0000073309
nue:CarryingValueOfTheTwoFieldOfWellsMember
2020-10-03
0000073309
nue:CarryingValueOfTheTwoFieldOfWellsMember
2019-12-31
0000073309
nue:UnprovedOilAndNaturalGasPropertiesMember
2020-10-03
utr:acre
0000073309
nue:SteelMillsMember
2019-12-31
0000073309
nue:SteelProductsMember
2019-12-31
0000073309
nue:RawMaterialsMember
2019-12-31
0000073309
nue:SteelProductsMember
2020-01-01
2020-10-03
0000073309
nue:SteelMillsMember
2020-10-03
0000073309
nue:SteelProductsMember
2020-10-03
0000073309
nue:RawMaterialsMember
2020-10-03
0000073309
2019-09-29
2019-12-31
0000073309
nue:RebarFabricationMember
2019-09-29
2019-12-31
0000073309
nue:RebarFabricationMember
2020-10-03
0000073309
nue:RebarFabricationMember
2019-12-31
0000073309
nue:GratingUnitMember
2019-06-30
2019-09-28
0000073309
nue:GratingUnitMember
2020-10-03
0000073309
nue:GratingUnitMember
2019-12-31
0000073309
srt:MinimumMember
2020-01-01
2020-10-03
0000073309
srt:MaximumMember
2020-01-01
2020-10-03
0000073309
us-gaap:CustomerRelationshipsMember
2020-10-03
0000073309
us-gaap:TrademarksAndTradeNamesMember
2020-10-03
0000073309
us-gaap:OtherIntangibleAssetsMember
2020-10-03
0000073309
us-gaap:CustomerRelationshipsMember
2019-12-31
0000073309
us-gaap:TrademarksAndTradeNamesMember
2019-12-31
0000073309
us-gaap:OtherIntangibleAssetsMember
2019-12-31
0000073309
nue:NumitMember
2020-10-03
0000073309
nue:SteelTechnologiesLLCMember
2020-10-03
nue:Sheet
0000073309
nue:SteelTechnologiesLLCMember
2020-01-01
2020-10-03
0000073309
nue:NumitMember
2020-01-01
2020-10-03
0000073309
nue:NumitMember
2019-12-31
0000073309
nue:NumitMember
2019-01-01
2019-09-28
0000073309
nue:DuferdofinMember
2020-10-03
0000073309
nue:DuferdofinMember
2020-01-01
2020-10-03
0000073309
nue:DuferdofinMember
2019-12-31
0000073309
nue:DuferdofinMember
2019-01-01
2019-12-31
0000073309
nue:DuferdofinMember
2020-07-05
2020-10-03
0000073309
nue:DuferdofinMember
2019-06-30
2019-09-28
0000073309
nue:DuferdofinMember
2019-01-01
2019-09-28
iso4217:EUR
0000073309
nue:FacilityMember
nue:DuferdofinMember
2020-10-03
0000073309
nue:FacilityMember
nue:DuferdofinMember
2019-12-31
0000073309
nue:FacilityMember
nue:DuferdofinMember
2020-01-01
2020-10-03
0000073309
nue:DuferdofinMember
2020-10-02
0000073309
nue:NucorJFEMember
2020-10-03
0000073309
nue:NucorJFEMember
2019-12-31
0000073309
nue:NucorJFEMember
2019-01-16
0000073309
nue:NucorJFEMember
nue:GeneralFinancingAgreementAndPromissoryNoteMember
2020-10-03
0000073309
nue:NucorJFEMember
nue:GeneralFinancingAgreementAndPromissoryNoteMember
2019-12-31
0000073309
nue:DuferdofinMember
2020-01-05
2020-04-04
0000073309
nue:DuferdofinMember
2020-04-05
2020-07-04
0000073309
nue:DuferdofinMember
2020-04-04
0000073309
us-gaap:CarryingReportedAmountFairValueDisclosureMember
2020-10-03
0000073309
us-gaap:FairValueInputsLevel1Member
us-gaap:FairValueMeasurementsRecurringMember
2020-10-03
0000073309
us-gaap:FairValueInputsLevel2Member
us-gaap:FairValueMeasurementsRecurringMember
2020-10-03
0000073309
us-gaap:CarryingReportedAmountFairValueDisclosureMember
2019-12-31
0000073309
us-gaap:FairValueInputsLevel1Member
us-gaap:FairValueMeasurementsRecurringMember
2019-12-31
0000073309
us-gaap:FairValueInputsLevel2Member
us-gaap:FairValueMeasurementsRecurringMember
2019-12-31
0000073309
nue:OmnibusPlanMember
srt:MaximumMember
2020-05-14
0000073309
nue:OmnibusPlanMember
2020-10-03
0000073309
nue:InactivePlansMember
2020-10-03
0000073309
us-gaap:EmployeeStockOptionMember
2020-01-01
2020-10-03
0000073309
us-gaap:EmployeeStockOptionMember
2020-10-03
0000073309
us-gaap:RestrictedStockUnitsRSUMember
2019-12-31
0000073309
us-gaap:RestrictedStockUnitsRSUMember
2020-01-01
2020-10-03
0000073309
us-gaap:RestrictedStockUnitsRSUMember
2020-10-03
0000073309
us-gaap:RestrictedStockUnitsRSUMember
2020-07-05
2020-10-03
0000073309
us-gaap:RestrictedStockUnitsRSUMember
2019-06-30
2019-09-28
0000073309
us-gaap:RestrictedStockUnitsRSUMember
2019-01-01
2019-09-28
0000073309
us-gaap:RestrictedStockUnitsRSUMember
nue:LtipMember
2020-01-01
2020-10-03
0000073309
us-gaap:RestrictedStockUnitsRSUMember
nue:AipMember
2020-01-01
2020-10-03
0000073309
nue:RestrictedStockAndRestrictedStockUnitsMember
2019-12-31
0000073309
nue:RestrictedStockAndRestrictedStockUnitsMember
2020-01-01
2020-10-03
0000073309
nue:RestrictedStockAndRestrictedStockUnitsMember
2020-10-03
0000073309
nue:RestrictedStockAndRestrictedStockUnitsMember
nue:AipAndLtipMember
2020-07-05
2020-10-03
0000073309
nue:RestrictedStockAndRestrictedStockUnitsMember
nue:AipAndLtipMember
2019-06-30
2019-09-28
0000073309
nue:RestrictedStockAndRestrictedStockUnitsMember
nue:AipAndLtipMember
2020-01-01
2020-10-03
0000073309
nue:RestrictedStockAndRestrictedStockUnitsMember
nue:AipAndLtipMember
2019-01-01
2019-09-28
0000073309
nue:RestrictedStockAndRestrictedStockUnitsMember
nue:AipAndLtipMember
2020-10-03
0000073309
nue:NucorYamatoSteelCompanyMember
2020-10-03
0000073309
nue:NucorYamatoSteelCompanyMember
2019-09-28
0000073309
2020-07-04
0000073309
us-gaap:CommonStockMember
2020-07-04
0000073309
us-gaap:AdditionalPaidInCapitalMember
2020-07-04
0000073309
us-gaap:RetainedEarningsMember
2020-07-04
0000073309
us-gaap:AccumulatedOtherComprehensiveIncomeMember
2020-07-04
0000073309
us-gaap:TreasuryStockMember
2020-07-04
0000073309
us-gaap:ParentMember
2020-07-04
0000073309
us-gaap:NoncontrollingInterestMember
2020-07-04
0000073309
us-gaap:RetainedEarningsMember
2020-07-05
2020-10-03
0000073309
us-gaap:ParentMember
2020-07-05
2020-10-03
0000073309
us-gaap:NoncontrollingInterestMember
2020-07-05
2020-10-03
0000073309
us-gaap:AccumulatedOtherComprehensiveIncomeMember
2020-07-05
2020-10-03
0000073309
us-gaap:AdditionalPaidInCapitalMember
2020-07-05
2020-10-03
0000073309
us-gaap:TreasuryStockMember
2020-07-05
2020-10-03
0000073309
us-gaap:CommonStockMember
2020-10-03
0000073309
us-gaap:AdditionalPaidInCapitalMember
2020-10-03
0000073309
us-gaap:RetainedEarningsMember
2020-10-03
0000073309
us-gaap:AccumulatedOtherComprehensiveIncomeMember
2020-10-03
0000073309
us-gaap:TreasuryStockMember
2020-10-03
0000073309
us-gaap:ParentMember
2020-10-03
0000073309
us-gaap:NoncontrollingInterestMember
2020-10-03
0000073309
us-gaap:CommonStockMember
2019-12-31
0000073309
us-gaap:AdditionalPaidInCapitalMember
2019-12-31
0000073309
us-gaap:RetainedEarningsMember
2019-12-31
0000073309
us-gaap:AccumulatedOtherComprehensiveIncomeMember
2019-12-31
0000073309
us-gaap:TreasuryStockMember
2019-12-31
0000073309
us-gaap:ParentMember
2019-12-31
0000073309
us-gaap:NoncontrollingInterestMember
2019-12-31
0000073309
us-gaap:RetainedEarningsMember
2020-01-01
2020-10-03
0000073309
us-gaap:ParentMember
2020-01-01
2020-10-03
0000073309
us-gaap:NoncontrollingInterestMember
2020-01-01
2020-10-03
0000073309
us-gaap:AccumulatedOtherComprehensiveIncomeMember
2020-01-01
2020-10-03
0000073309
us-gaap:AdditionalPaidInCapitalMember
2020-01-01
2020-10-03
0000073309
us-gaap:TreasuryStockMember
2020-01-01
2020-10-03
0000073309
2019-06-29
0000073309
us-gaap:CommonStockMember
2019-06-29
0000073309
us-gaap:AdditionalPaidInCapitalMember
2019-06-29
0000073309
us-gaap:RetainedEarningsMember
2019-06-29
0000073309
us-gaap:AccumulatedOtherComprehensiveIncomeMember
2019-06-29
0000073309
us-gaap:TreasuryStockMember
2019-06-29
0000073309
us-gaap:ParentMember
2019-06-29
0000073309
us-gaap:NoncontrollingInterestMember
2019-06-29
0000073309
us-gaap:RetainedEarningsMember
2019-06-30
2019-09-28
0000073309
us-gaap:ParentMember
2019-06-30
2019-09-28
0000073309
us-gaap:NoncontrollingInterestMember
2019-06-30
2019-09-28
0000073309
us-gaap:AccumulatedOtherComprehensiveIncomeMember
2019-06-30
2019-09-28
0000073309
us-gaap:AdditionalPaidInCapitalMember
2019-06-30
2019-09-28
0000073309
us-gaap:TreasuryStockMember
2019-06-30
2019-09-28
0000073309
us-gaap:CommonStockMember
2019-09-28
0000073309
us-gaap:AdditionalPaidInCapitalMember
2019-09-28
0000073309
us-gaap:RetainedEarningsMember
2019-09-28
0000073309
us-gaap:AccumulatedOtherComprehensiveIncomeMember
2019-09-28
0000073309
us-gaap:TreasuryStockMember
2019-09-28
0000073309
us-gaap:ParentMember
2019-09-28
0000073309
us-gaap:NoncontrollingInterestMember
2019-09-28
0000073309
us-gaap:CommonStockMember
2018-12-31
0000073309
us-gaap:AdditionalPaidInCapitalMember
2018-12-31
0000073309
us-gaap:RetainedEarningsMember
2018-12-31
0000073309
us-gaap:AccumulatedOtherComprehensiveIncomeMember
2018-12-31
0000073309
us-gaap:TreasuryStockMember
2018-12-31
0000073309
us-gaap:ParentMember
2018-12-31
0000073309
us-gaap:NoncontrollingInterestMember
2018-12-31
0000073309
us-gaap:RetainedEarningsMember
2019-01-01
2019-09-28
0000073309
us-gaap:ParentMember
2019-01-01
2019-09-28
0000073309
us-gaap:NoncontrollingInterestMember
2019-01-01
2019-09-28
0000073309
us-gaap:AccumulatedOtherComprehensiveIncomeMember
2019-01-01
2019-09-28
0000073309
us-gaap:AdditionalPaidInCapitalMember
2019-01-01
2019-09-28
0000073309
us-gaap:TreasuryStockMember
2019-01-01
2019-09-28
0000073309
us-gaap:CommonStockMember
srt:MaximumMember
2018-09-06
0000073309
us-gaap:CostOfSalesMember
2020-07-05
2020-10-03
0000073309
us-gaap:CostOfSalesMember
2020-01-01
2020-10-03
0000073309
nue:CanadianOperationsMember
2020-10-03
0000073309
us-gaap:CostOfSalesMember
2019-06-30
2019-09-28
0000073309
us-gaap:CostOfSalesMember
2019-01-01
2019-09-28
0000073309
nue:SteelMillsMember
us-gaap:OperatingSegmentsMember
2020-07-05
2020-10-03
0000073309
nue:SteelMillsMember
us-gaap:OperatingSegmentsMember
2019-06-30
2019-09-28
0000073309
nue:SteelMillsMember
us-gaap:OperatingSegmentsMember
2020-01-01
2020-10-03
0000073309
nue:SteelMillsMember
us-gaap:OperatingSegmentsMember
2019-01-01
2019-09-28
0000073309
nue:SteelProductsMember
us-gaap:OperatingSegmentsMember
2020-07-05
2020-10-03
0000073309
nue:SteelProductsMember
us-gaap:OperatingSegmentsMember
2019-06-30
2019-09-28
0000073309
nue:SteelProductsMember
us-gaap:OperatingSegmentsMember
2020-01-01
2020-10-03
0000073309
nue:SteelProductsMember
us-gaap:OperatingSegmentsMember
2019-01-01
2019-09-28
0000073309
nue:RawMaterialsMember
us-gaap:OperatingSegmentsMember
2020-07-05
2020-10-03
0000073309
nue:RawMaterialsMember
us-gaap:OperatingSegmentsMember
2019-06-30
2019-09-28
0000073309
nue:RawMaterialsMember
us-gaap:OperatingSegmentsMember
2020-01-01
2020-10-03
0000073309
nue:RawMaterialsMember
us-gaap:OperatingSegmentsMember
2019-01-01
2019-09-28
0000073309
nue:SteelMillsMember
us-gaap:IntersegmentEliminationMember
2020-07-05
2020-10-03
0000073309
nue:SteelMillsMember
us-gaap:IntersegmentEliminationMember
2019-06-30
2019-09-28
0000073309
nue:SteelMillsMember
us-gaap:IntersegmentEliminationMember
2020-01-01
2020-10-03
0000073309
nue:SteelMillsMember
us-gaap:IntersegmentEliminationMember
2019-01-01
2019-09-28
0000073309
nue:SteelProductsMember
us-gaap:IntersegmentEliminationMember
2020-07-05
2020-10-03
0000073309
nue:SteelProductsMember
us-gaap:IntersegmentEliminationMember
2019-06-30
2019-09-28
0000073309
nue:SteelProductsMember
us-gaap:IntersegmentEliminationMember
2020-01-01
2020-10-03
0000073309
nue:SteelProductsMember
us-gaap:IntersegmentEliminationMember
2019-01-01
2019-09-28
0000073309
nue:RawMaterialsMember
us-gaap:IntersegmentEliminationMember
2020-07-05
2020-10-03
0000073309
nue:RawMaterialsMember
us-gaap:IntersegmentEliminationMember
2019-06-30
2019-09-28
0000073309
nue:RawMaterialsMember
us-gaap:IntersegmentEliminationMember
2020-01-01
2020-10-03
0000073309
nue:RawMaterialsMember
us-gaap:IntersegmentEliminationMember
2019-01-01
2019-09-28
0000073309
srt:ConsolidationEliminationsMember
2020-07-05
2020-10-03
0000073309
srt:ConsolidationEliminationsMember
2019-06-30
2019-09-28
0000073309
srt:ConsolidationEliminationsMember
2020-01-01
2020-10-03
0000073309
srt:ConsolidationEliminationsMember
2019-01-01
2019-09-28
0000073309
us-gaap:OperatingSegmentsMember
nue:SteelMillsMember
2020-10-03
0000073309
us-gaap:OperatingSegmentsMember
nue:SteelMillsMember
2019-12-31
0000073309
us-gaap:OperatingSegmentsMember
nue:SteelProductsMember
2020-10-03
0000073309
us-gaap:OperatingSegmentsMember
nue:SteelProductsMember
2019-12-31
0000073309
us-gaap:OperatingSegmentsMember
nue:RawMaterialsMember
2020-10-03
0000073309
us-gaap:OperatingSegmentsMember
nue:RawMaterialsMember
2019-12-31
0000073309
srt:ConsolidationEliminationsMember
2020-10-03
0000073309
srt:ConsolidationEliminationsMember
2019-12-31
0000073309
nue:SteelMillsMember
nue:SheetMember
2020-07-05
2020-10-03
0000073309
nue:SheetMember
2020-07-05
2020-10-03
0000073309
nue:SteelMillsMember
nue:SheetMember
2020-01-01
2020-10-03
0000073309
nue:SheetMember
2020-01-01
2020-10-03
0000073309
nue:SteelMillsMember
nue:BarMember
2020-07-05
2020-10-03
0000073309
nue:BarMember
2020-07-05
2020-10-03
0000073309
nue:SteelMillsMember
nue:BarMember
2020-01-01
2020-10-03
0000073309
nue:BarMember
2020-01-01
2020-10-03
0000073309
nue:SteelMillsMember
nue:StructuralMember
2020-07-05
2020-10-03
0000073309
nue:StructuralMember
2020-07-05
2020-10-03
0000073309
nue:SteelMillsMember
nue:StructuralMember
2020-01-01
2020-10-03
0000073309
nue:StructuralMember
2020-01-01
2020-10-03
0000073309
nue:SteelMillsMember
nue:PlateMember
2020-07-05
2020-10-03
0000073309
nue:PlateMember
2020-07-05
2020-10-03
0000073309
nue:SteelMillsMember
nue:PlateMember
2020-01-01
2020-10-03
0000073309
nue:PlateMember
2020-01-01
2020-10-03
0000073309
nue:SteelProductsMember
nue:TubularProductsMember
2020-07-05
2020-10-03
0000073309
nue:TubularProductsMember
2020-07-05
2020-10-03
0000073309
nue:SteelProductsMember
nue:TubularProductsMember
2020-01-01
2020-10-03
0000073309
nue:TubularProductsMember
2020-01-01
2020-10-03
0000073309
nue:SteelProductsMember
nue:RebarFabricationMember
2020-07-05
2020-10-03
0000073309
nue:RebarFabricationMember
2020-07-05
2020-10-03
0000073309
nue:SteelProductsMember
nue:RebarFabricationMember
2020-01-01
2020-10-03
0000073309
nue:RebarFabricationMember
2020-01-01
2020-10-03
0000073309
nue:SteelProductsMember
nue:OtherSteelProductsMember
2020-07-05
2020-10-03
0000073309
nue:OtherSteelProductsMember
2020-07-05
2020-10-03
0000073309
nue:SteelProductsMember
nue:OtherSteelProductsMember
2020-01-01
2020-10-03
0000073309
nue:OtherSteelProductsMember
2020-01-01
2020-10-03
0000073309
nue:RawMaterialsMember
nue:RawMaterialsMember
2020-07-05
2020-10-03
0000073309
nue:RawMaterialsMember
2020-07-05
2020-10-03
0000073309
nue:RawMaterialsMember
nue:RawMaterialsMember
2020-01-01
2020-10-03
0000073309
nue:RawMaterialsMember
2020-01-01
2020-10-03
0000073309
nue:SteelMillsMember
2020-07-05
2020-10-03
0000073309
nue:SteelProductsMember
2020-07-05
2020-10-03
0000073309
nue:RawMaterialsMember
2020-07-05
2020-10-03
0000073309
nue:SteelMillsMember
2020-01-01
2020-10-03
0000073309
nue:RawMaterialsMember
2020-01-01
2020-10-03
0000073309
nue:SheetMember
nue:SteelMillsMember
2019-06-30
2019-09-28
0000073309
nue:SheetMember
2019-06-30
2019-09-28
0000073309
nue:SheetMember
nue:SteelMillsMember
2019-01-01
2019-09-28
0000073309
nue:SheetMember
2019-01-01
2019-09-28
0000073309
nue:BarMember
nue:SteelMillsMember
2019-06-30
2019-09-28
0000073309
nue:BarMember
2019-06-30
2019-09-28
0000073309
nue:BarMember
nue:SteelMillsMember
2019-01-01
2019-09-28
0000073309
nue:BarMember
2019-01-01
2019-09-28
0000073309
nue:StructuralMember
nue:SteelMillsMember
2019-06-30
2019-09-28
0000073309
nue:StructuralMember
2019-06-30
2019-09-28
0000073309
nue:StructuralMember
nue:SteelMillsMember
2019-01-01
2019-09-28
0000073309
nue:StructuralMember
2019-01-01
2019-09-28
0000073309
nue:PlateMember
nue:SteelMillsMember
2019-06-30
2019-09-28
0000073309
nue:PlateMember
2019-06-30
2019-09-28
0000073309
nue:PlateMember
nue:SteelMillsMember
2019-01-01
2019-09-28
0000073309
nue:PlateMember
2019-01-01
2019-09-28
0000073309
nue:TubularProductsMember
nue:SteelProductsMember
2019-06-30
2019-09-28
0000073309
nue:TubularProductsMember
2019-06-30
2019-09-28
0000073309
nue:TubularProductsMember
nue:SteelProductsMember
2019-01-01
2019-09-28
0000073309
nue:TubularProductsMember
2019-01-01
2019-09-28
0000073309
nue:RebarFabricationMember
nue:SteelProductsMember
2019-06-30
2019-09-28
0000073309
nue:RebarFabricationMember
2019-06-30
2019-09-28
0000073309
nue:RebarFabricationMember
nue:SteelProductsMember
2019-01-01
2019-09-28
0000073309
nue:RebarFabricationMember
2019-01-01
2019-09-28
0000073309
nue:OtherSteelProductsMember
nue:SteelProductsMember
2019-06-30
2019-09-28
0000073309
nue:OtherSteelProductsMember
2019-06-30
2019-09-28
0000073309
nue:OtherSteelProductsMember
nue:SteelProductsMember
2019-01-01
2019-09-28
0000073309
nue:OtherSteelProductsMember
2019-01-01
2019-09-28
0000073309
nue:RawMaterialsMember
nue:RawMaterialsMember
2019-06-30
2019-09-28
0000073309
nue:RawMaterialsMember
2019-06-30
2019-09-28
0000073309
nue:RawMaterialsMember
nue:RawMaterialsMember
2019-01-01
2019-09-28
0000073309
nue:RawMaterialsMember
2019-01-01
2019-09-28
0000073309
nue:SteelMillsMember
2019-06-30
2019-09-28
0000073309
nue:SteelProductsMember
2019-06-30
2019-09-28
0000073309
nue:RawMaterialsMember
2019-06-30
2019-09-28
0000073309
nue:SteelMillsMember
2019-01-01
2019-09-28
0000073309
nue:SteelProductsMember
2019-01-01
2019-09-28
0000073309
nue:RawMaterialsMember
2019-01-01
2019-09-28
0000073309
nue:VariableRateGreenBondsMember
2020-10-01
2020-10-03
0000073309
nue:NotesTwoPointZeroZeroZeroPercentDueTwoThousandTwentyFiveMember
2020-05-31
0000073309
nue:NotesTwoPointSevenZeroZeroPercentDueTwoThousandThirtyMember
2020-05-31
0000073309
nue:NotesTwoPointZeroZeroZeroPercentDueTwoThousandTwentyFiveMember
2020-05-01
2020-05-31
0000073309
nue:NotesTwoPointSevenZeroZeroPercentDueTwoThousandThirtyMember
2020-05-01
2020-05-31
0000073309
2020-05-01
2020-05-31
0000073309
2020-05-31
0000073309
nue:VariableRateGreenBondsMember
2020-07-01
2020-07-31
0000073309
srt:ScenarioForecastMember
2020-10-04
2020-12-31
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
☒ |
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended October 3, 2020
OR
☐ |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission File Number: 1-4119
NUCOR CORPORATION
(Exact name of registrant as specified in its charter)
Delaware |
|
13-1860817 |
(State or other jurisdiction of
incorporation or organization) |
|
(I.R.S. Employer
Identification No.) |
|
|
|
1915 Rexford Road, Charlotte, North Carolina |
|
28211 |
(Address of principal executive offices) |
|
(Zip Code) |
(704) 366-7000
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
|
Trading Symbol(s) |
|
Name of each exchange on which registered |
Common Stock, par value $0.40 per share |
|
NUE |
|
New York Stock Exchange |
Indicate by check mark whether the registrant (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 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer |
☒ |
|
Accelerated filer |
☐ |
Non-accelerated filer |
☐ |
|
Smaller reporting company |
☐ |
|
|
|
Emerging growth company |
☐ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
301,928,935 shares of the registrant’s common stock were outstanding at October 3, 2020.
Table of Contents
Nucor Corporation
Quarterly Report on Form 10-Q
For the Three Months and Nine Months Ended October 3, 2020
TABLE OF CONTENTS
i
Table of Contents
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Nucor Corporation Condensed Consolidated Statements of Earnings (Unaudited)
(In thousands, except per share amounts)
|
|
Three Months (13 Weeks) Ended |
|
|
Nine Months (39 Weeks) Ended |
|
|
|
Oct. 3, 2020 |
|
|
Sept. 28, 2019 |
|
|
Oct. 3, 2020 |
|
|
Sept. 28, 2019 |
|
Net sales |
|
$ |
4,927,960 |
|
|
$ |
5,464,502 |
|
|
$ |
14,879,603 |
|
|
$ |
17,457,112 |
|
Costs, expenses and other: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of products sold |
|
|
4,425,765 |
|
|
|
4,891,991 |
|
|
|
13,370,181 |
|
|
|
15,213,215 |
|
Marketing, administrative and other expenses |
|
|
165,513 |
|
|
|
159,301 |
|
|
|
460,922 |
|
|
|
549,020 |
|
Equity in losses (earnings) of unconsolidated affiliates |
|
|
(479 |
) |
|
|
1,585 |
|
|
|
14,422 |
|
|
|
(2,459 |
) |
Losses on assets |
|
|
6,604 |
|
|
|
- |
|
|
|
299,450 |
|
|
|
- |
|
Interest expense, net |
|
|
40,139 |
|
|
|
31,286 |
|
|
|
116,856 |
|
|
|
92,759 |
|
|
|
|
4,637,542 |
|
|
|
5,084,163 |
|
|
|
14,261,831 |
|
|
|
15,852,535 |
|
Earnings before income taxes and noncontrolling interests |
|
|
290,418 |
|
|
|
380,339 |
|
|
|
617,772 |
|
|
|
1,604,577 |
|
Provision for income taxes |
|
|
67,788 |
|
|
|
86,752 |
|
|
|
207,610 |
|
|
|
367,920 |
|
Net earnings |
|
|
222,630 |
|
|
|
293,587 |
|
|
|
410,162 |
|
|
|
1,236,657 |
|
Earnings attributable to noncontrolling interests |
|
|
29,215 |
|
|
|
18,556 |
|
|
|
87,535 |
|
|
|
73,337 |
|
Net earnings attributable to Nucor stockholders |
|
$ |
193,415 |
|
|
$ |
275,031 |
|
|
$ |
322,627 |
|
|
$ |
1,163,320 |
|
Net earnings per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.63 |
|
|
$ |
0.90 |
|
|
$ |
1.06 |
|
|
$ |
3.79 |
|
Diluted |
|
$ |
0.63 |
|
|
$ |
0.90 |
|
|
$ |
1.06 |
|
|
$ |
3.78 |
|
Average shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
303,394 |
|
|
|
304,637 |
|
|
|
303,072 |
|
|
|
305,553 |
|
Diluted |
|
|
303,441 |
|
|
|
304,980 |
|
|
|
303,099 |
|
|
|
306,029 |
|
See notes to condensed consolidated financial statements.
1
Table of Contents
Nucor Corporation Condensed Consolidated Statements of Comprehensive Income (Unaudited)
(In thousands)
|
|
Three Months (13 Weeks) Ended |
|
|
Nine Months (39 Weeks) Ended |
|
|
|
Oct. 3, 2020 |
|
|
Sept. 28, 2019 |
|
|
Oct. 3, 2020 |
|
|
Sept. 28, 2019 |
|
Net earnings |
|
$ |
222,630 |
|
|
$ |
293,587 |
|
|
$ |
410,162 |
|
|
$ |
1,236,657 |
|
Other comprehensive income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net unrealized income (loss) on hedging derivatives, net
of income taxes of $2,000 and $(1,000) for the third
quarter of 2020 and 2019, respectively, and $1,400
and $(2,500) for the first nine months of 2020 and
2019, respectively |
|
|
6,387 |
|
|
|
(3,315 |
) |
|
|
4,888 |
|
|
|
(7,801 |
) |
Reclassification adjustment for settlement of hedging
derivatives included in net income, net of income
taxes of $700 and $500 for the third quarter of 2020
and 2019, respectively, and $2,300 and $500 for the
first nine months of 2020 and 2019, respectively |
|
|
2,113 |
|
|
|
1,615 |
|
|
|
6,712 |
|
|
|
1,501 |
|
Foreign currency translation gain (loss), net of income
taxes of $0 for the third quarter and first nine months
of 2020 and 2019 |
|
|
16,867 |
|
|
|
(14,306 |
) |
|
|
(24,103 |
) |
|
|
(5,219 |
) |
|
|
|
25,367 |
|
|
|
(16,006 |
) |
|
|
(12,503 |
) |
|
|
(11,519 |
) |
Comprehensive income |
|
|
247,997 |
|
|
|
277,581 |
|
|
|
397,659 |
|
|
|
1,225,138 |
|
Comprehensive income attributable to noncontrolling
interests |
|
|
(29,215 |
) |
|
|
(18,556 |
) |
|
|
(87,535 |
) |
|
|
(73,337 |
) |
Comprehensive income attributable to Nucor stockholders |
|
$ |
218,782 |
|
|
$ |
259,025 |
|
|
$ |
310,124 |
|
|
$ |
1,151,801 |
|
See notes to condensed consolidated financial statements.
2
Table of Contents
Nucor Corporation Condensed Consolidated Balance Sheets (Unaudited)
(In thousands)
|
|
Oct. 3, 2020 |
|
|
Dec. 31, 2019 |
|
ASSETS |
|
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
2,866,578 |
|
|
$ |
1,534,605 |
|
Short-term investments |
|
|
412,401 |
|
|
|
300,040 |
|
Accounts receivable, net |
|
|
2,119,421 |
|
|
|
2,160,102 |
|
Inventories, net |
|
|
3,260,685 |
|
|
|
3,842,095 |
|
Other current assets |
|
|
306,762 |
|
|
|
389,528 |
|
Total current assets |
|
|
8,965,847 |
|
|
|
8,226,370 |
|
Property, plant and equipment, net |
|
|
6,829,733 |
|
|
|
6,178,555 |
|
Restricted cash and cash equivalents |
|
|
131,623 |
|
|
|
- |
|
Goodwill |
|
|
2,195,788 |
|
|
|
2,201,063 |
|
Other intangible assets, net |
|
|
678,558 |
|
|
|
742,186 |
|
Other assets |
|
|
717,728 |
|
|
|
996,492 |
|
Total assets |
|
$ |
19,519,277 |
|
|
$ |
18,344,666 |
|
LIABILITIES |
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
|
Short-term debt |
|
$ |
63,778 |
|
|
$ |
62,444 |
|
Current portion of long-term debt and finance lease obligations |
|
|
10,475 |
|
|
|
29,264 |
|
Accounts payable |
|
|
1,210,987 |
|
|
|
1,201,698 |
|
Salaries, wages and related accruals |
|
|
432,767 |
|
|
|
510,844 |
|
Accrued expenses and other current liabilities |
|
|
655,288 |
|
|
|
659,524 |
|
Total current liabilities |
|
|
2,373,295 |
|
|
|
2,463,774 |
|
Long-term debt and finance lease obligations due after one year |
|
|
5,452,193 |
|
|
|
4,291,301 |
|
Deferred credits and other liabilities |
|
|
976,722 |
|
|
|
798,415 |
|
Total liabilities |
|
|
8,802,210 |
|
|
|
7,553,490 |
|
EQUITY |
|
|
|
|
|
|
|
|
Nucor stockholders' equity: |
|
|
|
|
|
|
|
|
Common stock |
|
|
152,061 |
|
|
|
152,061 |
|
Additional paid-in capital |
|
|
2,117,582 |
|
|
|
2,107,646 |
|
Retained earnings |
|
|
11,068,908 |
|
|
|
11,115,056 |
|
Accumulated other comprehensive loss,
net of income taxes |
|
|
(315,469 |
) |
|
|
(302,966 |
) |
Treasury stock |
|
|
(2,720,668 |
) |
|
|
(2,713,931 |
) |
Total Nucor stockholders' equity |
|
|
10,302,414 |
|
|
|
10,357,866 |
|
Noncontrolling interests |
|
|
414,653 |
|
|
|
433,310 |
|
Total equity |
|
|
10,717,067 |
|
|
|
10,791,176 |
|
Total liabilities and equity |
|
$ |
19,519,277 |
|
|
$ |
18,344,666 |
|
See notes to condensed consolidated financial statements.
3
Table of Contents
Nucor Corporation Condensed Consolidated Statements of Cash Flows (Unaudited)
(In thousands)
|
|
Nine Months (39 Weeks) Ended |
|
|
|
Oct. 3, 2020 |
|
|
Sept. 28, 2019 |
|
Operating activities: |
|
|
|
|
|
|
|
|
Net earnings |
|
$ |
410,162 |
|
|
$ |
1,236,657 |
|
Adjustments: |
|
|
|
|
|
|
|
|
Depreciation |
|
|
525,688 |
|
|
|
477,957 |
|
Amortization |
|
|
62,877 |
|
|
|
64,655 |
|
Stock-based compensation |
|
|
56,122 |
|
|
|
74,311 |
|
Deferred income taxes |
|
|
140,606 |
|
|
|
76,737 |
|
Distributions from affiliates |
|
|
3,021 |
|
|
|
27,405 |
|
Equity in losses (earnings) of unconsolidated affiliates |
|
|
14,422 |
|
|
|
(2,459 |
) |
Losses on assets |
|
|
299,450 |
|
|
|
- |
|
Changes in assets and liabilities (exclusive of acquisitions and dispositions): |
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
37,547 |
|
|
|
197,783 |
|
Inventories |
|
|
590,434 |
|
|
|
476,761 |
|
Accounts payable |
|
|
15,366 |
|
|
|
(180,397 |
) |
Federal income taxes |
|
|
18,848 |
|
|
|
(177,405 |
) |
Salaries, wages and related accruals |
|
|
(69,235 |
) |
|
|
(157,317 |
) |
Other operating activities |
|
|
100,283 |
|
|
|
5,526 |
|
Cash provided by operating activities |
|
|
2,205,591 |
|
|
|
2,120,214 |
|
Investing activities: |
|
|
|
|
|
|
|
|
Capital expenditures |
|
|
(1,179,081 |
) |
|
|
(984,646 |
) |
Investment in and advances to affiliates |
|
|
(16,542 |
) |
|
|
(27,613 |
) |
Divestiture of affiliates |
|
|
- |
|
|
|
67,591 |
|
Disposition of plant and equipment |
|
|
19,492 |
|
|
|
32,922 |
|
Acquisitions (net of cash acquired) |
|
|
(20,368 |
) |
|
|
(9,495 |
) |
Purchase of investments |
|
|
(401,986 |
) |
|
|
(249,616 |
) |
Proceeds from the sale of investments |
|
|
301,249 |
|
|
|
- |
|
Other investing activities |
|
|
(33,536 |
) |
|
|
2,176 |
|
Cash used in investing activities |
|
|
(1,330,772 |
) |
|
|
(1,168,681 |
) |
Financing activities: |
|
|
|
|
|
|
|
|
Net change in short-term debt |
|
|
1,334 |
|
|
|
(10,145 |
) |
Proceeds from long-term debt, net of discount |
|
|
1,237,635 |
|
|
|
- |
|
Repayment of long-term debt |
|
|
(97,150 |
) |
|
|
- |
|
Bond issuance related costs |
|
|
(6,250 |
) |
|
|
- |
|
Issuance of common stock |
|
|
- |
|
|
|
5,892 |
|
Payment of tax withholdings on certain stock-based compensation |
|
|
(17,691 |
) |
|
|
(15,723 |
) |
Distributions to noncontrolling interests |
|
|
(106,193 |
) |
|
|
(71,241 |
) |
Cash dividends |
|
|
(368,636 |
) |
|
|
(369,270 |
) |
Acquisition of treasury stock |
|
|
(39,499 |
) |
|
|
(197,511 |
) |
Other financing activities |
|
|
(6,983 |
) |
|
|
(6,538 |
) |
Cash provided by (used in) financing activities |
|
|
596,567 |
|
|
|
(664,536 |
) |
Effect of exchange rate changes on cash |
|
|
(7,790 |
) |
|
|
482 |
|
Increase in cash and cash equivalents |
|
|
1,463,596 |
|
|
|
287,479 |
|
Cash and cash equivalents - beginning of year |
|
|
1,534,605 |
|
|
|
1,398,886 |
|
Cash and cash equivalents and restricted cash and
cash equivalents - end of nine months |
|
$ |
2,998,201 |
|
|
$ |
1,686,365 |
|
Non-cash investing activity: |
|
|
|
|
|
|
|
|
Change in accrued plant and equipment purchases |
|
$ |
- |
|
|
$ |
62,700 |
|
See notes to condensed consolidated financial statements.
4
Table of Contents
Nucor Corporation – Notes to Condensed Consolidated Financial Statements (Unaudited)
1. Basis of Interim Presentation
The information furnished in this Item 1 reflects all adjustments which are, in the opinion of management, necessary to a fair statement of the results for the interim periods presented and are of a normal and recurring nature unless otherwise noted. The information furnished has not been audited; however, the December 31, 2019 condensed consolidated balance sheet data was derived from audited financial statements but does not include all disclosures required by accounting principles generally accepted in the United States of America. The unaudited condensed consolidated financial statements included in this Item 1 should be read in conjunction with the audited consolidated financial statements and the notes thereto included in Nucor’s Annual Report on Form 10-K for the year ended December 31, 2019.
2. Inventories
Inventories consisted of approximately 40% raw materials and supplies and 60% finished and semi-finished products at October 3, 2020 (42% and 58%, respectively, at December 31, 2019). Nucor’s manufacturing process consists of a continuous, vertically integrated process from which products are sold to customers at various stages throughout the process. Since most steel products can be classified as either finished or semi-finished products, these two categories of inventory are combined.
3. Property, Plant and Equipment
Property, plant and equipment is recorded net of accumulated depreciation of $9.87 billion at October 3, 2020 ($9.42 billion at December 31, 2019).
Nucor performed an impairment assessment of its proved producing natural gas well assets in the fourth quarter of 2019. One of the main assumptions that most significantly affects the undiscounted cash flows determination used in the impairment assessment is management’s estimate of future pricing of natural gas and natural gas liquids. The pricing used in the impairment assessment was developed by management based on projected natural gas market supply and demand dynamics, in conjunction with a review of projections by market analysts. Management also makes key estimates on the expected reserve levels and on the expected lease operating costs. The impairment assessment was performed on each of Nucor’s three groups (“fields”) of wells, with each field defined by common geographic location.
As a result of the impairment assessment, Nucor recorded a non-cash impairment charge of $35.0 million relating to one field of wells in the fourth quarter of 2019. The post-impairment carrying value of this field was $11.2 million at October 3, 2020 ($12.3 million at December 31, 2019). The remaining two fields were not impaired as a result of the assessment and had a combined carrying value of $62.4 million at October 3, 2020 ($66.6 million at December 31, 2019). Changes in the natural gas industry or a prolonged low-price environment beyond what had already been assumed in the assessments could cause management to revise the natural gas and natural gas liquids price assumptions, the estimated reserves or the estimated lease operating costs. Unfavorable revisions to these assumptions or estimates could possibly result in further impairment of some or all of the fields of proved well assets.
Nucor owns a 49% leasehold interest in unproved oil and natural gas properties covering approximately 54,000 acres in the South Piceance Basin located in Colorado. Nucor is subject to forfeiture of a portion of its leasehold interest in these properties if we do not drill new wells within various contractually specified time periods. A decision to not develop a portion of these properties within the specified time periods would likely result in a partial asset impairment in the future. The carrying value of the entire leasehold interest at October 3, 2020 was $165.0 million. Nucor has full discretion on its participation in all future drilling capital investments related to the leasehold interest.
5
Table of Contents
4. Goodwill and Other Intangible Assets
The change in the net carrying amount of goodwill for the nine months ended October 3, 2020 by segment was as follows (in thousands):
|
|
Steel Mills |
|
|
Steel Products |
|
|
Raw Materials |
|
|
Total |
|
Balance at December 31, 2019 |
|
$ |
591,986 |
|
|
$ |
879,500 |
|
|
$ |
729,577 |
|
|
$ |
2,201,063 |
|
Other |
|
|
- |
|
|
|
(821 |
) |
|
|
- |
|
|
|
(821 |
) |
Translation |
|
|
- |
|
|
|
(4,454 |
) |
|
|
- |
|
|
|
(4,454 |
) |
Balance at October 3, 2020 |
|
$ |
591,986 |
|
|
$ |
874,225 |
|
|
$ |
729,577 |
|
|
$ |
2,195,788 |
|
Nucor completed its most recent annual goodwill impairment testing during the fourth quarter of 2019 and concluded that as of such time there was no impairment of goodwill for any of its reporting units.
The assessment performed in 2019 used forward-looking projections and included expected improvements in the future cash flows of one of the Company’s reporting units, Rebar Fabrication. The fair value of this reporting unit exceeded its carrying value by approximately 56% in the most recent assessment. The reporting unit’s profitability in the first nine months of 2020 significantly increased from the first nine months of 2019. We expect the 2020 operating results of the Rebar Fabrication reporting unit will continue to improve compared to 2019. If our assessment of the relevant facts and circumstances changes, or the actual performance of this reporting unit falls short of expected results, non-cash impairment charges may be required. Total goodwill associated with the Rebar Fabrication reporting unit was $352.7 million as of October 3, 2020 ($356.6 million as of December 31, 2019). An impairment of goodwill may also lead us to record an impairment of other intangible assets. Total finite-lived intangible assets associated with the Rebar Fabrication reporting unit were $59.6 million as of October 3, 2020 ($67.2 million as of December 31, 2019). There have been no triggering events requiring an interim assessment for impairment of the Rebar Fabrication reporting unit since the most recent annual goodwill impairment testing date.
Due to lower than expected operating results and anticipated changes to the Grating reporting unit’s business strategy and structure, the Company determined a triggering event occurred in the third quarter of 2019 and performed an impairment assessment. The fair value of the Grating reporting unit exceeded its carrying value by approximately 17% in that assessment. If our assessment of the relevant facts and circumstances changes, or the actual performance of this reporting unit falls short of expected results, non-cash impairment charges may be required. Total goodwill associated with the Grating reporting unit was $36.6 million as of October 3, 2020 ($36.8 million as of December 31, 2019).
Intangible assets with estimated useful lives of five to 22 years are amortized on a straight-line or accelerated basis and were comprised of the following as of October 3, 2020 and December 31, 2019 (in thousands):
|
|
October 3, 2020 |
|
|
December 31, 2019 |
|
|
|
Gross Amount |
|
|
Accumulated
Amortization |
|
|
Gross Amount |
|
|
Accumulated
Amortization |
|
Customer relationships |
|
$ |
1,412,323 |
|
|
$ |
821,029 |
|
|
$ |
1,412,954 |
|
|
$ |
767,532 |
|
Trademarks and trade names |
|
|
162,062 |
|
|
|
98,110 |
|
|
|
162,183 |
|
|
|
92,258 |
|
Other |
|
|
63,822 |
|
|
|
40,510 |
|
|
|
63,807 |
|
|
|
36,968 |
|
|
|
$ |
1,638,207 |
|
|
$ |
959,649 |
|
|
$ |
1,638,944 |
|
|
$ |
896,758 |
|
Intangible asset amortization expense in the third quarter of 2020 and 2019 was $20.7 million and $22.0 million, respectively, and was $62.9 million and $64.7 million in the first nine months of 2020 and 2019, respectively. Annual amortization expense is estimated to be $83.5 million in 2020; $82.3 million in 2021; $80.7 million in 2022; $80.0 million in 2023; and $79.2 million in 2024.
5. Equity Investments
The carrying value of our equity investments in domestic and foreign companies was $521.2 million at October 3, 2020 ($793.2 million at December 31, 2019) and is recorded in other assets in the condensed consolidated balance sheets.
NuMit
Nucor owns a 50% economic and voting interest in NuMit LLC (“NuMit”). NuMit owns 100% of the equity interest in Steel Technologies LLC, an operator of 26 sheet processing facilities located throughout the United States, Canada and
6
Table of Contents
Mexico. Nucor accounts for its investment in NuMit (on a one-month lag basis) under the equity method, as control and risk of loss are shared equally between the members of NuMit. Nucor’s investment in NuMit was $322.5 million at October 3, 2020 ($319.8 million at December 31, 2019). Nucor received distributions of $2.0 million and $27.4 million from NuMit during the first nine months of 2020 and 2019, respectively.
Duferdofin Nucor
Nucor owns a 50% economic and voting interest in Duferdofin Nucor S.r.l. (“Duferdofin Nucor”), an Italian steel manufacturer, and accounts for its investment (on a one-month lag basis) under the equity method, as control and risk of loss are shared equally between the members of Duferdofin Nucor.
Nucor’s investment in Duferdofin Nucor was $0.1 million at October 3, 2020 ($263.0 million at December 31, 2019). Nucor’s 50% share of the total net assets of Duferdofin Nucor was $128.6 million at October 3, 2020, resulting in a negative basis difference of $128.5 million. This was due to the $261.6 million impairment charge taken against the Company’s investment in Duferdofin Nucor in the first nine months of 2020 as discussed below, offset by the step-up to fair value of certain assets and liabilities attributable to Duferdofin Nucor, as well as the identification of goodwill ($86.5 million at December 31, 2019) and finite-lived intangible assets. This basis difference prior to the impairment charge, excluding the portion attributable to goodwill, was being amortized based on the remaining estimated useful lives of the various underlying net assets, as appropriate, through the first quarter of 2020. Beginning with the second quarter of 2020, the negative basis difference began amortizing based on the remaining estimated useful lives of the various underlying net assets, as appropriate. Amortization associated with the negative basis in the third quarter of 2020 was income of $1.9 million, compared to an expense of $2.2 million in the third quarter of 2019, associated with the fair value step-up. Net amortization was $1.6 million of income in the first nine months of 2020, and $6.7 million of expense in the first nine months 2019.
As of October 3, 2020, Nucor had outstanding notes receivable of €35.0 million ($41.0 million) from Duferdofin Nucor (€35.0 million, or $39.3 million, as of December 31, 2019). The notes receivable bear interest at a rate that resets annually on September 30 to the 12-month Euro Interbank Offered Rate plus 0.75% per year. The maturity date of the principal amounts is January 31, 2022. As of October 3, 2020 and December 31, 2019, the notes receivable were classified in other assets in the condensed consolidated balance sheets. These notes were fully reserved in connection with the $261.6 million impairment charge taken against the Company’s investment in Duferdofin Nucor in the first nine months of 2020.
Nucor has issued a guarantee for its ownership percentage (50%) of Duferdofin Nucor’s borrowings under Facility A of a Structured Trade Finance Facilities Agreement (“Facility A”). The fair value of the guarantee is immaterial. In April 2018, Duferdofin Nucor amended and extended Facility A to mature on April 16, 2021. The maximum amount Duferdofin Nucor could borrow under Facility A was €160.0 million ($187.5 million) at October 3, 2020. As of October 3, 2020, there was €132.0 million ($154.7 million) outstanding under that facility (€147.0 million, or $164.9 million, as of December 31, 2019). If Duferdofin Nucor fails to pay when due any amounts for which it is obligated under Facility A, Nucor could be required to pay 50% of such amounts pursuant to and in accordance with the terms of its guarantee. Any indebtedness of Duferdofin Nucor to Nucor is effectively subordinated to the indebtedness of Duferdofin Nucor under Facility A. Nucor has not recorded any liability associated with this guarantee.
On October 2, 2020, Nucor entered into an agreement (the “Duferdofin Agreement”) to transfer its 50% economic and voting interest in Duferdofin Nucor to the owner of the remaining 50% interest. The closing of the transaction is subject to Duferdofin Nucor renegotiating the borrowings currently under Facility A, Nucor’s relief under the guarantee and other customary closing conditions, including regulatory consents. The closing of the transaction is expected to occur during the fourth quarter of 2020. Nucor is continuing to evaluate the impact of the transaction contemplated by the Duferdofin Agreement on the financial statements, which will include foreign currency losses currently included in accumulated other comprehensive loss as outlined in Footnote 14 and other impacts.
Nucor-JFE
Nucor owns a 50% economic and voting interest in Nucor-JFE Steel Mexico, S. de R.L. de C.V. (“Nucor-JFE”), a 50-50 joint venture with JFE Steel Corporation of Japan, to build and operate a galvanized sheet steel plant in central Mexico. After delays caused by the COVID-19 pandemic, Nucor JFE is expected to begin commissioning in November of this year. Nucor accounts for its investment in Nucor-JFE (on a one-month lag basis) under the equity method, as control and risk of loss are shared equally between the members of Nucor-JFE. Nucor’s investment in Nucor-JFE was $150.3 million at October 3, 2020 ($163.2 million at December 31, 2019).
On January 16, 2019, Nucor entered into an agreement to guarantee a percentage, equal to its ownership percentage (50%), of Nucor-JFE’s borrowings under the General Financing Agreement and Promissory Note (the “JFE Facility”). The fair value of the guarantee is immaterial. Nucor’s guarantee expires on April 30, 2021. The maximum amount Nucor-JFE could borrow under the JFE Facility was $65.0 million as of October 3, 2020. The JFE Facility is uncommitted. As of October 3, 2020, there was $45.0 million outstanding under the JFE Facility (none as of December 31, 2019). If Nucor-JFE fails to pay when due any amounts for which it is obligated under the JFE Facility, Nucor could be required to pay 50% of such
7
Table of Contents
amounts pursuant to and in accordance with the terms of its guarantee. Nucor has not recorded any liability associated with this guarantee.
Nucor-JFE has other credit facilities that Nucor has agreed to guarantee. The principal amount subject to guarantee by Nucor for these other credit facilities was $25.0 million as of October 3, 2020 ($25.0 million as of December 31, 2019). The fair value of the guarantees is immaterial. If Nucor-JFE fails to pay when due any amounts for which it is obligated under the other credit facilities, Nucor could be required to pay such amounts pursuant to and in accordance with the terms of its guarantees. Nucor has not recorded any liability associated with these guarantees.
All Equity Investments
Nucor reviews its equity investments for impairment if and when circumstances indicate that a decline in fair value below their carrying amounts may have occurred. Nucor determined that a triggering event occurred in the first quarter of 2020 with respect to its equity method investment in Duferdofin Nucor due to adverse developments in the joint venture’s commercial outlook, which were and continue to be exacerbated by the COVID-19 pandemic, all of which have negatively impacted the joint venture’s strategic direction. After completing its impairment assessment, Nucor determined that the carrying amount exceeded its estimated fair value and the impairment condition was considered to be other than temporary. Therefore, Nucor recorded a $250.0 million impairment charge in the first quarter of 2020, a $5.0 million impairment charge in the second quarter of 2020, and a $6.6 million impairment charge in the third quarter of 2020 against its investment in Duferdofin Nucor. Any additional capital contributions, if necessary, that Nucor makes to Duferdofin Nucor will likely be subject to impairment. Additionally, in the first quarter of 2020 the Company fully reserved its €35.0 million ($41.0 million) outstanding note receivable from Duferdofin Nucor due to an assessment of the likelihood of collection in light of these adverse developments and its effective subordination to Facility A. These charges are included in losses on assets in the condensed consolidated statements of earnings. The assumptions that most significantly affect the fair value determination include projected cash flows and the discount rate. The Company-specific inputs for measuring fair value are considered “Level 3” or unobservable inputs that are not corroborated by market data under applicable fair value authoritative guidance, as quoted market prices are not available.
It is reasonably possible that material deviation of future performance from the estimates used in our most recent valuation could result in further impairment of our investment in Duferdofin Nucor and affect any potential liability associated with the Company’s guarantee of the indebtedness of Duferdofin Nucor as discussed above.
6. Current Liabilities
Book overdrafts, included in accounts payable in the condensed consolidated balance sheets, were $115.2 million at October 3, 2020 ($116.4 million at December 31, 2019). Dividends payable, included in accrued expenses and other current liabilities in the condensed consolidated balance sheets, were $123.0 million at October 3, 2020 ($122.9 million at December 31, 2019). Accrued vacation and holiday pay, included in salaries, wages and related accruals in the condensed consolidated balance sheets, were $121.8 million at October 3, 2020 ($106.2 million at December 31, 2019).
7. Fair Value Measurements
The following table summarizes information regarding Nucor’s financial assets and financial liabilities that were measured at fair value as of October 3, 2020 and December 31, 2019 (in thousands). Nucor does not have any non-financial assets or non-financial liabilities that are measured at fair value on a recurring basis.
8
Table of Contents
|
|
|
|
|
|
Fair Value Measurements at Reporting Date Using |
|
Description |
|
Carrying
Amount in
Condensed
Consolidated
Balance
Sheets |
|
|
Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1) |
|
|
Significant
Other
Observable
Inputs
(Level 2) |
|
|
Significant
Unobservable
Inputs
(Level 3) |
|
As of October 3, 2020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash equivalents |
|
$ |
2,539,777 |
|
|
$ |
2,539,777 |
|
|
$ |
- |
|
|
$ |
- |
|
Short-term investments |
|
|
412,401 |
|
|
|
412,401 |
|
|
|
- |
|
|
|
- |
|
Restricted cash and cash equivalents |
|
|
131,623 |
|
|
|
131,623 |
|
|
|
|
|
|
|
|
|
Total assets |
|
$ |
3,083,801 |
|
|
$ |
3,083,801 |
|
|
$ |
- |
|
|
$ |
- |
|
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Derivative contracts |
|
$ |
(6,577 |
) |
|
$ |
- |
|
|
$ |
(6,577 |
) |
|
$ |
- |
|
As of December 31, 2019 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash equivalents |
|
$ |
1,229,000 |
|
|
$ |
1,229,000 |
|
|
$ |
- |
|
|
$ |
- |
|
Short-term investments |
|
|
300,040 |
|
|
|
300,040 |
|
|
|
- |
|
|
|
- |
|
Total assets |
|
$ |
1,529,040 |
|
|
$ |
1,529,040 |
|
|
$ |
- |
|
|
$ |
- |
|
Li |