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August 2006

 

Nucor announces record first half and second quarter

Charlotte, NC— Nucor Corporation announced in July record consolidated net earnings and sales for the first half and second quarter of 2006. Net earnings per share and average shares outstanding for all periods reflect a two-for-one stock split effective in May 2006.

Nucor’s consolidated net earnings for the first half of 2006 were $831.9 million ($2.65 per diluted share), an increase of 23% over net earnings of $677.4 million ($2.11 per diluted share) in last year’s first half. Consolidated net earnings of $452.8 million ($1.45 per diluted share) in this year’s second quarter were an increase of 40% over $322.7 million ($1.01 per diluted share) earned in the second quarter of 2005 and an increase of 19% from the $379.2 million ($1.21 per diluted share) earned in the first quarter of 2006.

In the first half of 2006, Nucor’s consolidated net sales increased 14% to $7.35 billion, compared with $6.47 billion in last year’s first half. Average sales price per ton was flat while total tons shipped to outside customers increased 14% from the first half of 2005. Average sales price per ton increased 5% from the second quarter of 2005 and increased 4% from the first quarter of 2006. Total tons shipped to outside customers were a record 5,819,000 tons in the second quarter of 2006, an increase of 15% over the second quarter of 2005 and an increase of 4% over the first quarter of 2006.

The average scrap and scrap substitute cost per ton used in the first half of 2006 was $242, a decrease of 7% compared with $259 in the first half of 2005. The average scrap and scrap substitute cost per ton used in the second quarter of 2006 was $247, flat compared with $246 in the second quarter of 2005 and an increase of 4% compared with $237 in the first quarter of 2006. Total energy costs increased approximately $3 per ton from the first half of 2005 to the first half of 2006, decreased $1 per ton from the second quarter of 2005 to the second quarter of 2006, and decreased $4 per ton from the first quarter of 2006 to the second quarter of 2006.

Starting with the August 11, 2006 dividend payment, Nucor is increasing the supplemental dividend rate from $0.25 per share to $0.50 per share. This supplemental dividend is in addition to the $0.10 per share base dividend, for a total dividend of $0.60 per share.

Nucor repurchased approximately 3.6 million shares of Nucor’s common stock at a cost of approximately $186.4 million under a publicly announced stock repurchase program during the second quarter of 2006, and repurchased approximately 3.8 million shares at a cost of about $196.7 million during the first half of 2006. Approximately 22.0 million shares remain authorized for repurchase under the current program. Since the first quarter of 2005, Nucor has purchased approximately 15.0 million shares of Nucor’s common stock.

In May 2006, Nucor’s wholly owned subsidiary, Nucor Steel Connecticut, Inc., purchased substantially all of the assets of Connecticut Steel Corporation for a cash purchase price of approximately $43.9 million. Located in Wallingford, Connecticut, this bar products mill has an annual capacity of approximately 300,000 tons of wire rod and rebar and approximately 85,000 tons of wire mesh fabrication and structural mesh fabrication.

Also in May 2006, Nucor announced plans to construct its fourth facility to produce metal building systems and components. The facility will be located in the western United States and will have an annual capacity of approximately 45,000 tons. It is expected to cost approximately $27 million and to employ more than 200 people.

In June 2006, Nucor announced plans to construct its fourth sheet steel galvanizing facility which will be located at Nucor’s sheet mill in Decatur, Alabama. Annual capacity will be approximately 500,000 tons, and the facility will have the ability to produce 72-inch wide sheet. Total cost is estimated to be approximately $150 million.

In July 2006, Nucor announced plans to construct a steel mill in the southern United States that will produce special bar quality products. The facility will have a capacity of approximately 850,000 tons and will produce high quality carbon and alloy rounds and round cornered squares from 3” to 9” for the automotive, heavy equipment and service center markets. Several locations are currently under consideration.

For all three of these projects, construction is expected to begin after satisfactory resolution of site location, regulatory approvals, tax matters and various contracts.


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