OCTOBER 2009

Steel Dynamics updates third quarter earnings guidance

Steel Dynamics, Inc. updated its third quarter 2009 earnings outlook. Steel Dynamics now anticipates third-quarter earnings to be within a range of $0.20 to $0.25 per diluted share, somewhat higher than initial guidance of $0.10 to $0.20 provided in July. The estimate is based on anticipated fully diluted shares of 235 million.

“Since we announced our preliminary earnings views, we have seen continued strength in orders for flat-rolled steel and stronger volumes in metal recycling,” said Keith Busse, Chairman and CEO. “Earlier in the quarter, it was uncertain as to whether the strength in flat-rolled order entry could be maintained; encouragingly, orders have remained strong. Both the Flat Roll Division and The Techs have continued to experience strong order entry and are achieving excellent operating results. The Butler mill broke previous hot-band production records in August, producing at an annualized rate of 3 million tons, benefiting from mill modifications that were completed in early July. The order book continues to be solid, with bookings through October for value-added flat-rolled products.

“OmniSource is benefiting from increased demand for and increased flows of recycled ferrous scrap as domestic steel producers become more active buyers. As we indicated in July, we expect OmniSource to be profitable for the year as a result of significant improvements in processing volume and better margins due to higher facility utilization, better cost control, and more favorable pricing.

“The outlook for the fourth quarter remains uncertain, as the economy at this point appears to be fragile in its rather slow recovery mode. The most difficult part of our business remains our long-products steel divisions and our fabrication operations whose recovery awaits stronger construction activity. We have not yet seen signs of improvement in non-residential building or gains from government stimulus. Regarding the outlook for flat-roll steel, we believe it will still take a few months to determine if credit markets will continue to improve, allowing consumers to be more inclined to make major purchases, such as demonstrated in the Cash for Clunkers program. If on the other hand we begin to see steel and finished-product inventories building, flat-roll utilization could slow later in the year,” Busse said.