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 July 2, 2022

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  ☒

261,785,429 shares of the registrant’s common stock were outstanding at July 2, 2022.

Nucor Corporation

Quarterly Report on Form 10-Q

For the Three Months and Six Months Ended July 2, 2022

Table of Contents

			Page
Part I	Financial Information
	Item 1	Financial Statements (Unaudited)
		Condensed Consolidated Statements of Earnings – Three Months (13 Weeks) and Six Months (26 Weeks) Ended July 2, 2022 and July 3, 2021	1
		Condensed Consolidated Statements of Comprehensive Income – Three Months (13 Weeks) and Six Months (26 Weeks) Ended July 2, 2022 and July 3, 2021	2
		Condensed Consolidated Balance Sheets – July 2, 2022 and December 31, 2021	3
		Condensed Consolidated Statements of Cash Flows – Six Months (26 Weeks) Ended July 2, 2022 and July 3, 2021	4
		Notes to Condensed Consolidated Financial Statements	5
	Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	19
	Item 3	Quantitative and Qualitative Disclosures About Market Risk	26
	Item 4	Controls and Procedures	27
Part II	Other Information
	Item 1	Legal Proceedings	28
	Item 1A	Risk Factors	28
	Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	28
	Item 6	Exhibits	29
Signatures			30

i

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						Six Months (26 Weeks) Ended
	July 2, 2022			July 3, 2021			July 2, 2022			July 3, 2021
Net sales	$	11,794,474		$	8,789,164		$	22,287,756		$	15,806,304
Costs, expenses and other:
Cost of products sold		7,690,211			6,315,661			14,725,354			11,710,364
Marketing, administrative and other expenses		563,211			387,070			1,087,795			678,194
Equity in earnings of unconsolidated affiliates		(7,113	)		(19,403	)		(14,808	)		(32,642	)
Losses on assets		-			44,308			-			50,970
Interest expense, net		57,763			35,780			100,898			75,424
		8,304,072			6,763,416			15,899,239			12,482,310
Earnings before income taxes and noncontrolling interests		3,490,402			2,025,748			6,388,517			3,323,994
Provision for income taxes		763,165			454,289			1,434,165			765,021
Net earnings		2,727,237			1,571,459			4,954,352			2,558,973
Earnings attributable to noncontrolling interests		166,004			64,591			297,496			109,673
Net earnings attributable to Nucor stockholders	$	2,561,233		$	1,506,868		$	4,656,856		$	2,449,300
Net earnings per share:
Basic	$	9.69		$	5.05		$	17.34		$	8.14
Diluted	$	9.67		$	5.04		$	17.30		$	8.13
Average shares outstanding:
Basic		263,221			296,817			267,416			299,359
Diluted		263,719			297,529			268,066			299,738

See notes to condensed consolidated financial statements.

1

Nucor Corporation Condensed Consolidated Statements of Comprehensive Income (Unaudited)

(In thousands)

	Three Months (13 Weeks) Ended					Six Months (26 Weeks) Ended
	July 2, 2022			July 3, 2021		July 2, 2022			July 3, 2021
Net earnings	$	2,727,237		$	1,571,459	$	4,954,352		$	2,558,973
Other comprehensive income (loss):
Net unrealized income on hedging derivatives, net    of income taxes of $5,100 and $2,600 for the second    quarter of 2022 and 2021, respectively, and $21,900    and $3,000 for the first six months of 2022 and    2021, respectively		16,138			8,204		69,614			9,203
Reclassification adjustment for settlement of hedging    derivatives included in net earnings, net of income    taxes of ($4,800) and $0 for the second quarter of    2022 and 2021, respectively, and ($6,500) and    $100 for the first six months of 2022 and    2021, respectively		(15,136	)		196		(20,526	)		697
Foreign currency translation (loss) gain, net of income    taxes of $0 for the second quarter and first six    months of 2022 and 2021		(27,308	)		21,431		(4,616	)		35,232
		(26,306	)		29,831		44,472			45,132
Comprehensive income		2,700,931			1,601,290		4,998,824			2,604,105
Comprehensive income attributable to noncontrolling    interests		166,004			64,591		297,496			109,673
Comprehensive income attributable to Nucor stockholders	$	2,534,927		$	1,536,699	$	4,701,328		$	2,494,432

See notes to condensed consolidated financial statements.

2

Nucor Corporation Condensed Consolidated Balance Sheets (Unaudited)

(In thousands)

	July 2, 2022			Dec 31, 2021
ASSETS
Current assets:
Cash and cash equivalents	$	2,002,708		$	2,364,858
Short-term investments		363,287			253,005
Accounts receivable, net		4,749,600			3,853,972
Inventories, net		6,579,142			6,011,182
Other current assets		339,074			316,540
Total current assets		14,033,811			12,799,557
Property, plant and equipment, net		9,213,600			8,114,818
Restricted cash and cash equivalents		88,262			143,800
Goodwill		3,929,503			2,827,344
Other intangible assets, net		3,429,149			1,103,759
Other assets		974,132			833,794
Total assets	$	31,668,457		$	25,823,072
LIABILITIES
Current liabilities:
Short-term debt	$	100,509		$	107,723
Current portion of long-term debt and finance lease obligations		629,171			615,678
Accounts payable		2,315,796			1,974,041
Salaries, wages and related accruals		1,239,617			1,495,166
Accrued expenses and other current liabilities		1,074,108			964,805
Total current liabilities		5,359,201			5,157,413
Long-term debt and finance lease obligations due after one year		6,621,685			4,961,410
Deferred credits and other liabilities		1,834,763			1,100,455
Total liabilities		13,815,649			11,219,278
Commitments and contingencies
EQUITY
Nucor stockholders' equity:
Common stock		152,061			152,061
Additional paid-in capital		2,115,178			2,140,608
Retained earnings		22,064,383			17,674,100
Accumulated other comprehensive loss,    net of income taxes		(70,810	)		(115,282	)
Treasury stock		(7,452,168	)		(5,835,098	)
Total Nucor stockholders' equity		16,808,644			14,016,389
Noncontrolling interests		1,044,164			587,405
Total equity		17,852,808			14,603,794
Total liabilities and equity	$	31,668,457		$	25,823,072

See notes to condensed consolidated financial statements.

3

Nucor Corporation Condensed Consolidated Statements of Cash Flows (Unaudited)

(In thousands)

	Six Months (26 Weeks) Ended
	July 2, 2022			July 3, 2021
Operating activities:
Net earnings	$	4,954,352		$	2,558,973
Adjustments:
Depreciation		397,270			362,492
Amortization		87,267			41,858
Stock-based compensation		74,219			66,729
Deferred income taxes		(36,220	)		102,367
Distributions from affiliates		2,287			180
Equity in earnings of unconsolidated affiliates		(14,808	)		(32,642	)
Losses on assets		-			50,970
Changes in assets and liabilities (exclusive of acquisitions and dispositions):
Accounts receivable		(648,569	)		(1,093,021	)
Inventories		(157,976	)		(1,673,962	)
Accounts payable		198,062			726,649
Federal income taxes		33,441			290,287
Salaries, wages and related accruals		(252,758	)		385,265
Other operating activities		97,174			97,041
Cash provided by operating activities		4,733,741			1,883,186
Investing activities:
Capital expenditures		(968,795	)		(702,378	)
Investment in and advances to affiliates		(227	)		(169	)
Disposition of plant and equipment		15,996			10,665
Acquisitions (net of cash acquired)		(3,465,866	)		300
Purchases of investments		(330,278	)		(357,917	)
Proceeds from the sale of investments		219,996			367,512
Other investing activities		(7,096	)		587
Cash used in investing activities		(4,536,270	)		(681,400	)
Financing activities:
Net change in short-term debt		(7,214	)		42,780
Proceeds from issuance of long-term debt, net of discount		2,091,934			-
Repayment of long-term debt		(506,000	)		-
Bond issuance costs		(13,138	)		-
Proceeds from exercise of stock options		18,819			128,800
Payment of tax withholdings on certain stock-based compensation		(58,218	)		(64,416	)
Distributions to noncontrolling interests		(268,535	)		(97,196	)
Cash dividends		(272,038	)		(246,539	)
Acquisition of treasury stock		(1,707,893	)		(916,145	)
Proceeds from government incentives		125,000			-
Other financing activities		(17,059	)		(5,072	)
Cash used in financing activities		(614,342	)		(1,157,788	)
Effect of exchange rate changes on cash		(817	)		8,079
(Decrease) increase in cash and cash equivalents and    restricted cash and cash equivalents		(417,688	)		52,077
Cash and cash equivalents and restricted cash and cash    equivalents - beginning of year		2,508,658			2,754,929
Cash and cash equivalents and restricted cash and cash    equivalents - end of six months	$	2,090,970		$	2,807,006
Non-cash investing activity:
Change in accrued plant and equipment purchases	$	(23,583	)	$	44,754

See notes to condensed consolidated financial statements.

4

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, 2021 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, 2021.

2. Inventories

Inventories consisted of approximately 37% raw materials and supplies and 63% finished and semi-finished products at July 2, 2022 (43% and 57%, respectively, at December 31, 2021). 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 $10.72 billion at July 2, 2022 ($10.39 billion at December 31, 2021).

4. Goodwill and Other Intangible Assets

The change in the net carrying amount of goodwill for the six months ended July 2, 2022 by segment was as follows (in thousands):

	Steel Mills		Steel Products			Raw Materials			Total
Balance at December 31, 2021	$	613,175	$	1,439,874		$	774,295		$	2,827,344
Acquisitions		62,011		1,062,176			-			1,124,187
Other		-		-			(19,983	)		(19,983	)
Translation		-		(2,045	)		-			(2,045	)
Balance at July 2, 2022	$	675,186	$	2,500,005		$	754,312		$	3,929,503

Nucor completed its most recent annual goodwill impairment testing as of the first day of the fourth quarter of 2021 and concluded that as of such date there was no impairment of goodwill for any of its reporting units.

The annual assessment performed in 2021 for one of the Company’s reporting units, Rebar Fabrication, used forward-looking projections in future cash flows. The fair value of this reporting unit exceeded its carrying value by approximately 54% in the most recent assessment. If our assessment of the relevant facts and circumstances changes, including if the expected future performance of this reporting unit declines from the most recent assessment, non-cash impairment charges may be required. Total goodwill associated with the Rebar Fabrication reporting unit was $361.3 million as of July 2, 2022 ($363.0 million as of December 31, 2021). 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 $40.9 million as of July 2, 2022 ($45.0 million as of December 31, 2021). 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.

5

Intangible assets with estimated useful lives of five to 25 years are amortized on a straight-line or accelerated basis and were comprised of the following as of July 2, 2022 and December 31, 2021 (in thousands):

	July 2, 2022				December 31, 2021
	Gross Amount		Accumulated Amortization		Gross Amount		Accumulated Amortization
Customer relationships	$	4,134,981	$	982,186	$	1,872,348	$	924,506
Trademarks and trade names		364,355		110,946		217,255		99,906
Other		108,446		85,501		105,522		66,954
	$	4,607,782	$	1,178,633	$	2,195,125	$	1,091,366

Intangible asset amortization expense in the second quarter of 2022 and 2021 was $45.9 million and $20.8 million, respectively, and $87.3 million and $41.9 million in the first six months of 2022 and 2021, respectively. Annual amortization expense is estimated to be $233.2 million in 2022; $232.7 million in 2023; $232.0 million in 2024; $231.0 million in 2025; and $228.0 million in 2026.

5. Current Liabilities

Book overdrafts, included in accounts payable in the condensed consolidated balance sheets, were $185.6 million at July 2, 2022 ($143.8 million at December 31, 2021). Dividends payable, included in accrued expenses and other current liabilities in the condensed consolidated balance sheets, were $132.1 million at July 2, 2022 ($137.6 million at December 31, 2021).

6. Fair Value Measurements

The following table summarizes information regarding Nucor’s financial assets and financial liabilities that were measured at fair value as of July 2, 2022 and December 31, 2021 (in thousands). Nucor does not have any non-financial assets or non-financial liabilities that are measured at fair value on a recurring basis.

				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 July 2, 2022
Assets:
Cash equivalents	$	1,230,885		$	1,230,885	$	-		$	-
Short-term investments		363,287			363,287		-			-
Restricted cash and cash equivalents		88,262			88,262		-			-
Derivative contracts		77,860		-			77,860			-
Total assets	$	1,760,294		$	1,682,434	$	77,860		$	-
As of December 31, 2021
Assets:
Cash equivalents	$	1,776,477		$	1,776,477	$	-		$	-
Short-term investments		253,005			253,005		-			-
Restricted cash and cash equivalents		143,800			143,800		-			-
Derivative contracts		6,633			-		6,633			-
Total assets	$	2,179,915		$	2,173,282	$	6,633		$	-
Liabilities:
Derivative contracts	$	(2,666	)	$	-	$	(2,666	)	$	-

6

Fair value measurements for Nucor’s cash equivalents, short-term investments and restricted cash and cash equivalents are classified under Level 1 because such measurements are based on quoted market prices in active markets for identical assets. Our short-term investments at July 2, 2022 consisted of certificates of deposit, commercial paper and corporate notes. Fair value measurements for Nucor’s derivatives, which are typically commodity or foreign exchange contracts, are classified under Level 2 because such measurements are based on published market prices for similar assets or are estimated based on observable inputs such as interest rates, yield curves, credit risks, spot and future commodity prices, and spot and future exchange rates. There were no transfers between the levels in the fair value hierarchy for the periods presented.

The fair value of short-term and long-term debt, including current maturities, was approximately $6.77 billion at July 2, 2022 (approximately $6.06 billion at December 31, 2021). The debt fair value estimates are classified under Level 2 because such estimates are based on readily available market prices of our debt at July 2, 2022 and December 31, 2021, or similar debt with the same maturities, ratings and interest rates.

7. Contingencies

We are from time to time a party to various lawsuits, claims and other legal proceedings that arise in the ordinary course of business. With respect to all such lawsuits, claims and proceedings, we record reserves when it is probable a liability has been incurred and the amount of loss can be reasonably estimated. We do not believe that any of these proceedings, individually or in the aggregate, would be expected to have a material adverse effect on our results of operations, financial position or cash flows. Nucor maintains liability insurance with self-insurance limits for certain risks.

8. Stock-Based Compensation

Stock Options 

A summary of activity under Nucor’s stock option plans for the first six months of 2022 is as follows (shares and aggregate intrinsic value in thousands):