Good morning, and welcome to Nucor's First Quarter 2025 Earnings Call. All lines have been placed on mute to prevent any background noise. And today's call is being recorded. After the speakers' prepared remarks, I will provide instructions for callers wishing to ask questions. I would now like to introduce Jack Sullivan, Vice President of Nucor Investor Relations. You may begin your call.

Thank you, and good morning, everyone. Welcome to Nucor's first quarter 2025 earnings review and business update. Leading our call today is Leon Topalian, Chair, President and CEO; along with Steve Laxton, Executive Vice President and CFO. Other members of Nucor's executive team are also here with us today and may participate during the Q&A portion of the call. Yesterday, we posted our first quarter earnings release and investor presentation to Nucor's IR website. We encourage you to access these materials as we will cover portions of them during the call. Today's discussion will include the use of non-GAAP financial measures and forward-looking information within the meaning of securities laws. Actual results may be different than forward-looking statements and involve risks outlined in our Safe Harbor statement and disclosed in Nucor's SEC filings. The appendix of today's presentation includes supplemental information and disclosures, along with a reconciliation of non-GAAP financial measures. So with that, let's turn the call over to Leon.

Thanks, Jack. Before we discuss the quarterly results, I'd like to acknowledge the important contributions of two retiring executive team members. Chad Utermark, our EVP of New Markets and Innovation will retire in June after more than three decades with Nucor. Chad has exemplified the Nucor culture and has positively impacted thousands of team members during his tenure. His leadership in executing our expand beyond strategy in driving key acquisitions has been invaluable. We extend our best wishes to Chad and his family in his retirement. Additionally, Greg Murphy, our EVP of Business Services and General Counsel, will also retire in June. Since joining Nucor in 2015, Greg has provided exceptional leadership and his impact and advocacy leading our legal, environmental, government affairs and communications teams has been instrumental in developing long-term strategies that serve our shareholders, customers, and our team. So on behalf of our more than 32,000 team members, thank you both for all of your leadership, friendship, and dedication to Nucor. You will be greatly missed. With Greg's retirement, Ben Pickett has also been promoted to EVP of Business Services and Doug Wilner has been promoted to President of Corporate Legal Affairs and General Counsel. And just last week, we announced Tom Batterbee will be promoted to EVP of Human Resources and Talent effective May 11. Tom is an exceptional leader with more than 35 years of service with Nucor. In his new role, Tom will drive Nucor's strategy for the growth, retention, and development of all Nucor team members. Please join me in giving a warm welcome to Ben, Doug and Tom in their new roles. Turning now to our first quarter results. Nucor generated EBITDA of $696 million and earned $0.77 of adjusted EPS. Despite the lower results compared to prior quarters, Nucor's strong balance sheet and deep liquidity allowed the company to advance its long-term growth plans on a number of fronts. During the quarter, we reinvested nearly $860 million into the company with approximately two-thirds of that going into projects that will commence operations over the next two years. We've returned nearly $430 million of capital to Nucor shareholders. We've prefunded upcoming debt maturities raising $1 billion in new senior notes with a weighted average coupon of 4.88%, and took steps to wind down or repurpose certain operations at divisions where we believe resources can be allocated more efficiently. Through it all, we've continued to live our culture, taking care of our team, customers, and shareholders. The capital projects we've undertaken are designed to strengthen and diversify our earnings profile for shareholders and better serve the evolving needs of our customers. Several of these projects will commence operations within the next 12 months and I'd like to take a moment to provide an update on them. Within the bar mill group, our Rebar Micro Mill in Lexington, North Carolina, rolled its first billet in April and is on track to produce its first heat in June. Commercial shipments are expected to occur in the third quarter. At our Kingman, Arizona bar mill, we expect the new melt shop to produce its first seed in June and be operational in the third quarter. We've also made considerable headway with new coating facilities at our existing sheet mills. The coating complex at our Crawfordsville, Indiana sheet mill is scheduled to be completed by year's end and will add galvanizing and pre-paint capabilities at the location. Additionally, the new galvanizing line at our Berkeley County sheet mill in South Carolina is on track to completion by mid-2026. Within our towers and structures business, the Greenfield projects in Alabama and Indiana will commence operations throughout the next nine months. Customers have already started to tour the Alabama location and we are working through initial phases of the qualification process. The Alabama project is slated to begin operations in the third quarter of this year and the Indiana project is on track to begin operations in the first quarter of 2026. While construction on our West Virginia sheet mill will continue through 2026, the team there continues to do a great job of moving the project forward. We're near the midpoint of the construction timeline and equipment installation is well underway. We remain on schedule to commission the mill by the end of next year and look forward to supplying the markets with some of North America's cleanest and most advanced sheet steels. Over the past several months, we've seen significant changes in federal trade policy, including the welcome reinstatement and broadening of Section 232 steel tariffs. Since its implementation in 2018, the 232 tariffs have been significantly weakened through country exemptions, quotas, and numerous product exclusions. By 2024, fewer than 18% of steel imports were subject to Section 232 tariffs. Ending the exclusions and quota agreements was necessary to strengthen the U.S. steel industry, which was the original goal of the 232 tariffs. We have always maintained the belief that America's national security depends on a robust and healthy American steel industry. As America's largest and most diversified steel producer, we applaud recent steps to help level the playing field for American steel producers. In addition, the trade case relating to certain corrosion resistant steel products continues to progress. Earlier this month, the Department of Commerce announced preliminary anti-dumping duties on coated flat rolled steel from 10 countries. Many of our country's trading partners have taken advantage of our open markets for far too long, to the detriment of the American manufacturer and their teams. These trade remedies, as well as the comprehensive Section 232 tariffs are the sort of enforcement mechanisms required to stop unfairly traded imports. For nearly 30 years, Nucor has worked across administrations to ensure strong trade law enforcement, and we will continue to be outspoken on these issues so long as there are trading partners who do not play by the rules of free and fair trade. When speaking to investors over the past several weeks, we've heard a lot of questions about the outlook for steel demand in light of macroeconomic uncertainty and volatility. So let me spend a few moments describing what we're seeing and what we're focused on. For starters, in the first quarter, we saw backlogs rise over 30% in our steel mill segments and rise nearly 25% in steel products. We recognize a portion of this may be pulled forward. However, we continue to see very healthy order entry rates and relatively stable pricing. We're also seeing an administration that seeks less regulation, a lower corporate tax rate, and has demonstrated a willingness to pivot and course correct as conditions evolve. We're seeing steady to improving demand for steel among customers who are engaged in the reshoring, rebuilding, and repowering of American industry. And Nucor is best positioned to supply these growing markets, as evidenced by our order books, which include projects like the advanced manufacturing facilities, infrastructure projects, new hospitals, schools, airports, power plants, and stadiums. Overall, we continue to see the current improving demand environment in line with our expectations in 2025. And when you couple that with Nucor's product breadth and capabilities paired with recent policies in support of U.S. manufacturers, it's hard not to be optimistic about Nucor's future. While the economy is grappling with a lot of uncertainty and volatility, rest assured, Nucor is built for this. We have the right capabilities, the right team, and the right financial strength to preserve, regardless of the macroeconomic trends. Our mission to grow the core, expand beyond and live our culture is how we plan to succeed. But all of this requires execution. It's through great execution that Nucor turns potential into value creation for our shareholders and our customers. And that's why my most important message to the team during this period of transformative growth is to stay focused and accountable as we bring new projects to life across the enterprise. Before handing it over to Steve, I want to mention that we recently posted our 2024 Corporate Sustainability Report to the Nucor website. We're proud to share that our greenhouse gas emission intensity is among the lowest in the global steel industry and we believe demand for cleaner steels will continue to grow. The report highlights how we're advancing the development of cleaner energy sources such as nuclear energy, as well as carbon-free iron sources and other low carbon raw materials. The report also highlights impressive progress our team has made in reducing injuries over the last several years. I'd encourage you to look through it and learn more about how our team is working to care for one another, the environment, and the communities we call home. With that, I'll turn it over to Steve who will provide more details about our performance in the first quarter and our outlook for the second.

Thank you, Leon. And thank you all for joining us on the call this morning. During the first quarter, Nucor generated net earnings of $156 million or $0.67 per share. This includes pre-tax charges of $29 million or $0.10 per share of after-tax charges related to the closing or repurposing of facilities in our steel products segment and ceasing production of wire rod at our Connecticut bar mill. Excluding these one-time charges, our annual earnings were approximately $179 million or $0.77 per share. Leon highlighted the progress we've made on several of our larger growth initiatives. While these growth investments create long-term shareholder value, they also create near-term earnings headwinds. During the first quarter, Nucor incurred $170 million or $0.56 per share in pre-operating and startup costs. Turning to the segment level results for the quarter and adjusting for the one-time charges just mentioned, the steel mill segment generated adjusted pre-tax earnings of $241 million increasing approximately 43% from the prior quarter. While average realized prices were roughly in line with the first quarter prices, volume increased 14%. The most pronounced increase came from the bar mill group where shipments rose 21% compared to the prior quarter and 20% year-over-year. We also saw improvement in plate shipments driven by a combination of good customer demand and improved operations at our Brandenburg, Kentucky plate mill. Brandenburg shipments in production have trended higher for five consecutive quarters, a testament to the progress of that team. While shipments were higher during the first quarter, we were also booking at healthy levels. As Leon mentioned previously, our steel mills backlog grew more than 30% throughout the quarter and sits up nearly 25% over this time last year. Nucor's steel products segment affords a wider and more diverse set of solutions than others in our industry. That capability breadth is a meaningful differentiator and value creator. The segment continues to deliver pronounced impacts on Nucor's overall earnings profile. The steel products segment generated adjusted pre-tax earnings of $307 million for the first quarter. Steel products also saw meaningful backlog growth, up nearly 25% across all downstream products for the quarter. Our Joist & Deck backlogs now extend into the fourth quarter. As we've shared in the past, the longer duration backlogs for some products within this segment mainly experience a lag between pricing changes in the market and realized financial results, and we're seeing this effect now and expect lower realized pricing in our financial results for some of these businesses in coming months. But it's important to note that we expect margins in this backlog to remain well above pre-pandemic levels. Given where backlog set broader coverage under Section 232 and our healthy current order book, we have a constructive view on the steel products segment for the balance of 2025. Since 2022, we've made several acquisitions to expand our construction products capabilities that leverage our company's core competency as an efficient manufacturer. These acquisitions and subsequent organic growth investments have established four distinct platforms with higher growth and margin potential for our shareholders. During 2024, our overhead doors, racking and insulated metal panels' platforms generated EBITDA of approximately $400 million when annualizing for mid-year acquisitions. For 2025, we expect these three platforms will generate approximately $450 million in EBITDA, with further growth expected in 2026 when our new towers and structures facilities enter their first full year of production. Turning to our raw materials segment. We realized pre-tax earnings of approximately $29 million for the quarter, a decrease of approximately $28 million from the fourth quarter. Lower realized pricing for DRI and higher operating expenses in some of our scrap processing operations were the primary factors affecting the quarter-over-quarter change. Moving to the balance sheet. We remain committed to maintaining a strong investment-grade credit quality. A healthy balance sheet with ample liquidity has been a hallmark of Nucor for decades and continues to put the company in a position of strength, allowing us to execute our strategy throughout various phases of the economic cycle. In March, Nucor increased its revolving credit facility by $500 million, and we raised $1 billion of senior notes at a weighted average coupon of just under 4.9%. This $1 billion offering was split evenly across 5 and 10-year tenors with proceeds being used to retire $1 billion of notes that reach final maturity in late May and early June. The rating agencies continue to affirm our investment-grade credit rating outlooks. Our ratings are the highest of any North American steel producer with an A- rating and stable outlooks from both S&P and Fitch and a Baa1 rating on positive outlook from Moody's. Nucor ended the first quarter with a total debt to capital of approximately 27% and just over $4 billion in cash. However, as just mentioned, we intend to use $1 billion of the cash recently raised from our debt offering to retire debt. So adjusting for this intended use, Nucor would have debt to capital of just under 25%, more in line with recent periods, and cash of just over $3 billion. In addition to maintaining a strong balance sheet, the cornerstone of Nucor's capital allocation framework is to provide meaningful direct returns to shareholders. During the first quarter, that principle was on display as we returned $429 million to shareholders in the form of dividends and share repurchases. Leon spoke earlier about our outlook, but now I'd like to drill deeper on what we're seeing across some of our businesses. Within sheet, we're seeing continued resilient demand from key end-use markets like construction and energy. Our sheet backlog grew meaningfully during the first quarter, and we expect our second quarter shipments to increase further. The effects of the cores trade case, coupled with the recent Section 232 refresh, should temper unfairly dumped and predatorily priced materials, allowing for improved stability in the sheet business. Turning to bar. While there is potential concern that some of the commercial construction planning may be pausing in response to recent market volatility, larger projects in advanced manufacturing, infrastructure, and institutional construction remain largely unaffected and continue to represent steady business for us. Consequently, we see improved financial performance in bar in the second quarter. Imports were meaningfully higher during the first quarter, reflecting front-running of tariffs. Within our plate and structural groups, some of the same demand drivers are having a positive impact. Nucor is a leading supplier to structural fabricators, and we saw higher shipments for projects ranging from data centers and warehouses to bridges and other infrastructure projects. New energy-related projects are also driving demand. We're supplying piling for solar farms, plate for onshore wind and transmission towers, and getting qualified to supply steel for API-grade line pipe out of Brandenburg. Our backlogs are up significantly in both beam and plate, and we expect strong shipment levels and stable pricing to continue into the second half of this year. And in the steel products segment, our backlogs are up year-over-year by 19%. Highlighting a few of our larger businesses within that segment, we expect continued strong performance from Joist & Deck and strengthening performance from our tubular and metal buildings groups. Positive construction trends on growing data center demand; stable warehouse activity and ongoing institutional construction are driving backlog growth. In addition, operational gains in our tubular and metal buildings group, coupled with lower imports for tubular are setting this up for positive momentum in coming months. Turning to our second quarter 2025 outlook. We expect Nucor's earnings to be meaningfully higher than in the first quarter of this year. Operating results at the steel mills, steel products, and raw materials segments are all expected to be stronger than the first quarter. The steel mills segment is expected to drive the largest portion of the sequential earnings growth due to stable volumes and higher realized pricing. Within this segment, Nucor's sheet and plate business are expected to drive the majority of the increase. In the steel products segment, we expect higher volumes and improved cost to more than offset slightly lower realized pricing. In our raw materials segment, we expect volumes to remain flat along with moderating scrap pricing and stable realized DRI pricing. We also expect sequential cost improvements within our scrap processing operations. As we look further into 2025, our expectations for demand remain generally in line with the optimism we shared on our year-end earnings call. We still expect to see growth in domestic steel demand this year, and we're confident in our ability to capture a healthy share of that demand with the best and most diverse range of solutions in the marketplace. And with that, we'd like to hear from you and answer any questions you may have.

Thank you. Ladies and gentlemen, we'll now begin the question-and-answer session. Your first question comes from Lawson Winder, Bank of America Securities. You may now speak.

Thank you very much, operator, and good morning, Leon. Good morning, Steve. It's nice to hear from both of you. I appreciate the update. Steve, during the last call, you shared some insights regarding the start-up costs for 2024 and indicated that we should factor those costs into our considerations for 2025. Could you provide more details on what those start-up costs might be for this year, especially now that we have four solid months of data to reflect on?

Yes, Lawson, that's a great question. For the remainder of the year, you can expect results similar to last year. For your modeling over the next couple of quarters, I suggest using figures close to what we've experienced recently. In the past few quarters, we reported $160 million and $164 million, with $170 million in the most recent quarter. We're currently in an intensive phase of capital spending and starting new projects. As Leon mentioned earlier, we have five projects launching this year, which we're excited about. The ramp-up rate for these start-ups is an important factor to consider as well. So, you should anticipate results akin to last year.

Okay. That's extremely helpful. Also, when you think about Brandenburg, what are you estimating for utilization at the end of 2025?

Yes. Lawson, it's Leon. Look, I would tell you, we couldn't be more proud of what the team has done in Brandenburg and their ramp. I'm going to ask Brad to touch on just a few of the details because I think they're worth highlighting, some of the very specifics that they've been able to achieve in the recent months. Brad, why don't you provide some details there?

Yes. Thanks, Leon. As we mentioned on the last earnings call, we're very confident in getting to EBITDA positive run rates by this summer, and we remain confident we're on track for that. My confidence really stems from what the team has been able to achieve there. We've seen record days, record weeks, record months in production, in quality and shipments, really culminating in a record shipment month in March. And we expect those volumes to continue to grow as the year goes on. Again, the key to Brandenburg is really around product development, and we've seen a tremendous amount of progress there. In fact, 25% of what we shipped out of Brandenburg in the first quarter were products that Nucor was unable to offer prior to Brandenburg. A couple of specifics there I'd like to touch on. One, the team has been working for 6 months or 8 months now and finally achieved our ABS certification, which will allow us to supply customers in the shipbuilding space. So a huge step forward. And then secondly, we shipped our first wide X70 trials for that growing API line pipe market that Steve had referenced in his comments. That's a market that's typically around a 2 million, 2.5 million ton market and really heavily supplied traditionally by imports. So we're seeing very high levels of quote activity and our customers are excited for Brandenburg to give them a domestic supply chain option. So overall, we're super proud of the team, what they've accomplished. We're excited about the feedback we're getting from our customers who are ready to grow with Brandenburg and with the Nucor plate group.

Yes, it's a fantastic story. Great update. Thanks for that color. And just maybe one sort of follow-up on Brandenburg. What is or how do you think about the split between higher margin, higher value-add product versus more commoditized product from that and the mix going forward from here this year and potentially next?

Yes, Lawson, I'll speak to that from a broad perspective. The product capabilities at Brandenburg address approximately 96% of the total plate consumption in the United States. As Brad mentioned, our focus will remain on developing the most advanced grades to provide the highest-quality plate products. However, it is important to find a balance, as you noted. We will evaluate our overall production mix across Brandenburg, our Hertford County plant, and Tuscaloosa. Together, these three locations form a comprehensive commercial strategy aimed at both increasing mill volume and transitioning to higher value-added products and grades. You can expect us to target both areas, as qualifying for these higher grades, such as ABS, requires significant time to establish the necessary process controls. Interestingly, the ABS qualification is timely, especially in light of the President's executive order regarding ships, Section 301, and the anticipated SHIPS for America Act. This situation positions us exceptionally well to provide products that Nucor has never previously offered and that, frankly, few others in North America can manufacture.

Thank you. Your next question comes from Timna Tanners from Wolfe Research.

Yes. Hey, good morning. Thanks for the color. I have two questions. So the first one I wanted to ask about is if you can provide us more clarity on the second quarter guidance. When you talk about the steel mills segment improving quarter-over-quarter, it seems like a pretty easy calculation on the flat-rolled side to say prices are up, say, $200 quarter-over-quarter. Scrap is maybe flat to down. Seems like it could be a huge order of magnitude. I'm just wondering if you could provide any more framework around year-over-year is it going to be similar. Or any more ways to think about the cadence first to second quarter? Thanks.

Timna, I think that's pretty good math you're doing there. We're going to refrain. We're not going to give any quantitative guidance with detail on the earnings call. What we're going to do is wait until our mid-quarter guidance on that. But your math is dialing in the right direction.

Okay. Fair enough that I tried. And then the second question is really about not taking away from the clear benefits from tariffs for the entire sector, of course, and for your downstream business, but just getting questions out tariff impact particular to Nucor. So for example, the slabs brought into CSI traditionally, equipment for your new mills such as West Virginia, Trinidad, DRI. Can you talk about ways that you're mitigating any of those tariff impacts that might not be so positive? Thanks again.

Yes. Timna, look, I'll touch on that. And look, it's something obviously is changing every day, right? We're seeing the reports out this morning, as I'm sure you are and what the President is likely to do regarding automobiles in that sector. So we're monitoring incredibly closely what those potential impacts will be. You specifically mentioned West Virginia. Look, much of that equipment has not only been bought. It's already been delivered. And so the exposure there is dropping day-to-day. And so it's not de minimis but again it's not, from an overall perspective, a significant needle mover to Nucor this year in the coming. But I say that at the same time, telling you, look, many of these tariffs and the final remedies are not executed yet. So in the raw material supply chain, Nucor maintains the most diversified raw material supply strategy in the industry period, full stop. But look, I'd be remiss if I didn't come up to a higher level as well to say the small impact potential of higher raw material price vastly is much smaller than the impact of the overall macroeconomic trends in the industry, a healthy, vibrant steel industry and having a critical national defense, and the pro-American policies that you're seeing adopted by the administration trumps all of that, pun intended. And so again, we'll monitor. We'll try to provide you more realistic data as we learn it. But again, we think the impact to West Virginia from an equipment standpoint can be minimal. On raw materials, Al, anything you'd add that I didn't touch on?

Yes. I think you covered it well. And Timna, it's a good question. It's obviously been an active year for us. I think what's helpful to talk through is just how we're positioned in raw material, and there's a few ways we're positioned that are unique and create value. One is the footprint, not only of our recycling assets but of our mills, that particularly our high-quality metallic consuming mills to plate steel mills are all located on one, which gives us access to global markets, seaborne markets. And then once that material is here, we can move it around the country really effectively on the river system. The second is the intelligence gathering capabilities we have through the David J. Joseph Company. We operate the largest scrap brokerage in North America. We're buying and selling ferrous, non-ferrous, ferro alloys, raw materials around the globe every day. And third of those global relationships. These are long-standing relationships we have that give us access to the different levers we can pull to impact and mitigate the very risk that you're talking about. So that's really the unique positioning. And Leon hit it. It's very fluid. We don't spend a lot of time predicting. We spend a lot of time preparing for the changes that we know will come. And we've got the levers we can pull and we've got the pieces in place to allow us to do that and create value.

Thank you. Your next call will be Alex Hacking, Citi.

Yes. Good morning. Thanks for the question. So I just wanted to ask about the extension of Section 232 to downstream products. Have you tried to quantify how many tons that could impact and what the benefits could be for Nucor? Thanks.

Yes, Alex. Look, it is fluid, as Al just mentioned, and it's something that our team, Ben Pickett and his team in Washington spends a great deal of time. No, we have not quantified or, at least if we have, nothing that I would share publicly. But what I would tell you is the overall impact and how we're seeing these move through is consequential. It is impacting. We're seeing again a drop below 20% imports for the first time in many years. So it's having that positive impact. The other piece of this that we did not see in Trump 1.0 during his first term was derivative products being included in these pieces of legislation. So again, we think that's a step in the right direction, and we'll continue to work with the current administration to make sure that all of the products, whether it's raw materials or downstream are being looked at and considered for again not just Nucor, but the health and the vibrancy of the steel industry and the macro.

Okay. Thanks. And then just following up on the guidance of steel products. Steve, I think you said that prices would probably decline for the next couple of quarters just based on lags and so on. But I also think you implied that margins would be relatively stable because substrate costs would also kind of be coming down. Is that the message? I just wanted to double-check that.

Yes, Alex, this is John Hollatz. So we were successful in implementing price increases across all of our downstream businesses over the course of Q1. And some of those businesses, you will see a lag when we realize those price increases later in the year, more so on Joist & Deck, buildings, rebar fabrication. So there will be some margin compression, which is normal as we work through these cycles. In Q2, the business that we'll see the benefit immediately is the tubular products, where those are very closely related to the price of hot band, and we are realizing well above the increases in hot band on our tubular sales. But what we've been through this every time we go through the cycle is very much what we would expect to happen.

Thank you. And your next call is from Bill Peterson from JPMorgan.

Good morning, team, and thank you for taking my questions. I want to revisit the mills in relation to the first quarter results and second quarter guidance, specifically what is driving the stable outlook. Did you benefit from five additional shipping days? You mentioned the quarter ended on April 5, so I'm curious if there were more shipping days in the first quarter and less in the second quarter. Additionally, can you clarify if there was any pull-forward in demand during Q1 and how that might influence the stable outlook for Q2? Lastly, within the mills, are there any specific formats, such as plate, bar, or sheet, that might outperform or have increased shipments compared to others?

Yes, Bill, I'll start this off, and then maybe Steve can add some color to, I think, the first question you had around volumes and the additional shipping days. But look, let's begin with the part of your question about pull-through. We've gotten that a lot over the last 6, 8 weeks since these tariffs were announced. And what I would tell you, look, we did see some pull-through. We did see some urgency coming right as those were announced. But the important part of that and looking through that pull-through is what happened on the back end of that in the last month or two. And what we've seen is no drop-off at all in terms of order entry rates and inquiries. In fact, I would tell you, it's been as strong as we continue into the quarter. So we've seen no drop-off whatsoever. And as we think about the backlog that Steve and I both touched on in our opening comments, I'll share one data point with you. Again, while they're up about 30% Q-over-Q, 25% year-over-year, one data point that we look at that I think is a good bellwether for kind of the macroeconomic trend is our structural backlog. If we look today at what our structural backlog is, it is sitting at the highest levels in our history like ever. So the backlog at Nucor-Yamato, Nucor Berkeley beams are sitting at levels we've never seen before. And what I would tell you in that backlog, it's not distribution. It is orders by our fabricators. And so that is locked-in business on projects that have been let and awarded. And so that backlog is massive, hundreds and hundreds of thousands of tons. And so that bodes very well as we move throughout the rest of this year in terms of, as you asked about the upside. And so there are upside potentials? Yes. There are absolutely upside potentials. We've used the words cautiously optimistic, but we are optimistic about what we're seeing. We're optimistic about our backlog to order entry rates, our pricing stability throughout the entire enterprise as well as the demand drivers like the segments that we serve in data centers, energy, warehousing, the advanced manufacturing towers and structures and those two plants that will be coming up online in the coming weeks. So Nucor is well-positioned to again meet these end markets today as well as tomorrow if these projects come online. And so as Brad mentioned, our excitement about Brandenburg and it's realizing its full offering and again, paying back our shareholders, so the $1.7 billion is exciting. But look, we couldn't be more excited by Lexington, North Carolina's micro mill, the Kingman, Arizona melt shop that will be starting up in the coming months or galvanizing lines in CSI, Crawfordsville, Nucor Steel Berkeley and ultimately culminating with a West Virginia start-up at the end of next year, which will offer the most state-of-the-art, cleanest, advanced offering in automotive exposed deals that Nucor has ever entertained before. So yes, I couldn't be more optimistic about the year, but quite frankly, the next several years as Nucor's full potential is realized.

Yes. Thanks for that. And again, I don't know if Steve can comment on the five shipping days or not. But maybe the second question is the intersegment eliminations came in a bit lighter than we had expected, and the guidance implies a higher level in the second quarter. Is this primarily related to your expectations of a steady downstream activity into the third quarter or back half of the year? Is there anything related to higher-priced DRI coming out of Trinidad? Or are there other factors at play? Yes. Regarding the calendar question, it's a characteristic of Nucor's financial calendar that appears every five or six years, resulting in a 95-day quarter. Last year, we had about 90 or 91 days; I can’t recall the exact number. This is due to how we've managed our fiscal calendar in relation to the Gregorian calendar for roughly 50 years. So, you'll need to account for that. The second part of your question about corporate eliminations likely isn't surprising, as that figure is increasing due to the current pricing environment and the strength of our broad-based backlog, which Leon pointed out. This strength isn't limited to one or two areas but spans our entire portfolio, resulting in flat to increasing volumes in certain sections. As margin and profitability rise, the elimination number also increases.

Thank you. Your next question comes from Mike Harris from Goldman Sachs.

Yes. Good morning. Thanks. Just considering the adjusted EPS of $0.77 compared to the guided range of $0.50 to $0.60. Can you speak to what happened or didn't happen between March 20 and quarter end that resulted in what appears to be roughly, I don't know, $40 million to $60 million after-tax windfall?

Yes. Hey Mike, there were really kind of a few parts to your question there. One is why do we have a beat? And the other, what's in the adjusted number? And so really, the beat was driven by volume beat in our steel segment. That's where the vast, vast majority of that came from. And it was bar and sheet primarily. Those are our largest volume businesses. So maybe that's not overly surprising to you. And with regards to the adjustments, those were non-reoccurring adjustments that were related to either the closure of facilities or the repurposing of facilities. About one-third of those were related to our steelmaking business and about two-thirds were related to downstream product locations.

Okay. Thanks for that additional color. And then just one quick follow-up here. It looks as if you lost about maybe 120 basis points of gross margin sequentially. And I guess besides the 10 planned outages, what else contributed to the squeeze in? Maybe speak to any structural cost increases versus what may be transient.

Yes. Mike, there's really a couple of places where the margin squeezes we're seeing. One is if you look at year-over-year numbers, if you look at that in our steel mill business, conversion costs were up about 2% to 3%. That was largely driven by energy costs being a little bit higher and some of our consumables were up just a little bit. Overall, most of the costs were sideways year-over-year and a few were down. So you're seeing some of that in primarily energy. But then the second aspect is scrap cost quarter-over-quarter, we're up about 3%. So the combination of those and that lag effect that we have in our pricing of our steel means that you had some margin squeeze, even though we were in a period when market prices were going up.

Thank you. Your next question is from Katja Jancic from BMO Capital Markets.

Hi, thank you for taking my questions. Maybe circling back to the earlier tariff questions and just to confirm, the $3 billion CapEx that you're spending this year, that does not include any speculation for tariffs. Is that correct?

That's correct.

And then if there is any equipment that still needs to be imported into the U.S., which countries would that equipment be coming from?

Italy. Mostly Italy, some Germany.

Europe, Katja.

So there's no other exposure; it's mainly just Europe, right?

That's correct. Yes.

And then last one and I might have missed this. But Brandenburg mill, how much did it produce this quarter?

We didn't share the number earlier, but we're on that 150,000 to 160,000 ton pace, but that's ramping up. We anticipate that increasing throughout the rest of this year as we bring it to its full run rate potential.

Thank you. And your next question is from Chris LaFemina from Jefferies.

Hi, thanks for taking my questions. I just wanted to ask about demand. You had mentioned that commercial construction may be pausing in some cases. And obviously, order book is very strong, but we're seeing in other metal markets maybe even unprecedented inventory building in the U.S. ahead of tariffs. And obviously, that's a factor in steel. You mentioned that. But how do you differentiate between demand being pulled forward ahead of tariffs and actual underlying demand? And what gives you the confidence that the outlook beyond the first quarter is good when there's clearly been some stockpiling happening in the steel markets in the U.S., especially when you're seeing some end markets begin to soften?

Yes. Well, Chris, look, I think it's a great question. But the reality is we've been in this business for six decades. We've operated Yamato for 35 years. We know our fabricator community incredibly well. And so to your point, we're not alone to the recognition of tariffs and the impact. And we look at a number of factors. Number one, our fabricator community does not preorder. They don't build up inventory and put tons on the books in speculation. They just don't do that. We look at months on hand in the area that you do worry about, which is distribution. And look, did we see an increase from at 2.1 months on hand to a 3 or 3.5, which tells you, you're going to see a 2 or 3-month gap between orders. Well, what did we go to see in sheet? And you've seen no drop-off whatsoever. We see the days on hand in the distribution side remaining very flat. So we're not seeing the initial pull-through of a couple of months ago actually having any material impact to decreasing the relative order book and strength that we're seeing. The third piece of that, arm is booked. Our teams to get out, our commercial teams are interacting with our customers and talking to them each and every day. And so their confidence that our customers are describing that their customers have is significant. And again, added to that are other areas that we're going to continue to see in growth. One of the areas we didn't mention in Brandenburg that's incredibly promising is I can't tell you the number of RFQs that have hit that mill on OCTG. The volume of the potential impact of that energy sector coming through to Nucor's order book is not going to be insignificant. The border wall potential to come through in our tubular products again bodes very well for the potential as well as what we're seeing in the structural orders in bridge contracts, IIJA and the infrastructure bill, which is still in the early days, the CHIPS Act. And so all of these again have meaningful impacts on our order book. But what we are not seeing is what you described as this massive buildup and a drop-off in a holding pattern of projects not being let. We are seeing the opposite. And we're seeing these things come to fruition because they're taking the deliveries.

Thank you. And your next question is from Tristan Gresser from BNP Paribas.

Yes. Hi, thank you for taking my questions. Maybe a first one on the follow-up on the trade policy outlook. Are you in discussion with the U.S. administration to remove those tariffs on pig iron and DRI shipments? Do you think that's a possibility? And also, do you think there is another area of focus that the administration should have? Do you think quotas could actually come back? That's my first question.

Yes, Tristan, look, here's what I would tell you is, again, we mentioned in my opening comments from when Dan DiMicco is running this company, we've taken a very active and public role to be advocates in our industry as North America's largest steel and steel producer, product producer. That continues to this day. And so whether it was President Biden or currently President Trump, are we working to make sure that their administration has the right information, the right understanding of the impacts related to this industry? Absolutely. We're doing that every day. Are we looking to provide the right context for the decision to be made? Unequivocally. However, look, that's an input to the administration. It's not the only source that obviously they're taking. And so creating that relevancy and how that gets made into decision-making, we'll both wait and see. But obviously, the raw material sector, the tariffs, the derivative products, those things that impact Nucor, yes, we are working incredibly closely and making sure that they have the right information.

All right. That's helpful. My second question is about capital expenditures. Could you discuss the increase in the West Virginia budget? Additionally, how much has been spent on the project so far in 2023 and 2024? If there has been an increase to the budget, does that mean that by 2026, group capital expenditures could be quite close to the current guidance for 2025?

Noah here. I want to provide some general insights on West Virginia without directly addressing your questions. We are currently on track with the CapEx plan we previously shared, aiming for a start-up in late 2026 to 2027. The team has completed about 40% to 50% of the mill construction, and it is starting to resemble a steel mill as we begin to install equipment. Our focus now is on the commissioning plan to ensure the mill enters the auto market as efficiently as possible. You can see the groundwork for EAF auto supply taking shape in West Virginia as the team implements this plan. We are doing excellent work and remain aligned with the timeline we provided earlier.

Yes. Tristan, additionally, look, here's what I would tell you. Over the last several years, that facility and that project are not immune to the impacts of what we've seen in inflation and price increases in terms of contractor rates, fuels, materials, and labor. And so that is why you've seen the increase to West Virginia. It's not adding scope or things that were missed. It's the inflationary impacts of, again, a pretty healthy economy and again demand pull in construction right now that you saw the increase.

Yes. Tristan, we are currently slightly over halfway through our spending on that project. You can expect us to continue investing significantly over the next few years. To remind you, our total capital plan for this coming year is around $3 billion, with approximately two-thirds allocated for growth initiatives. West Virginia is the largest among those projects and will account for about half of our overall capital expenditure for the year.

And your next question is from Carlos de Alba from Morgan Stanley.

Yes, thank you. Good morning, everyone. Could you comment maybe on capacity utilization, what is your expectation in the coming quarter? We saw a very nice jump quarter-on-quarter. Year-on-year was more stable. But based on the comments that you provided and your outlook for demand, should we expect capacity utilization to keep going higher?

Yes. Carlos, I don't want to predict what the utilization rates are going to be next quarter. But I would tell you, based on our commentary, as you noted from Q4 of about 74%, 75% to 80% in this quarter, look, the demand drivers are certainly encouraging. The overall picture, though, in terms of our volumes that we're looking at in this year, and it's going to be up a couple of percentage points, but that will flow through in different sectors of our business. But overall, I think you could see them slightly improving as we move throughout the year.

All right. Great. I might have missed this, but could you provide some information about the inventories at Nucor's operating segments or specific product lines? How do they compare to the historical average for this time of year?

Are you talking backlog, Carlos?

More inventory, product inventory.

Yes. Inventories, Carlos, are roughly in line with seasonal adjustments and backlog levels we've got compared to history.

Is that true for most of the main product lines?

Yes, you may notice that we are possibly increasing our activity in certain areas more than others. Overall, when we look at our backlog collectively, we are in a favorable position.

Thank you. There are no further questions at this time. I will now hand the call back to Leon Topalian for the closing comments.

Thank you for joining us for today's call and for your questions. Nucor's strong balance sheet and prudent capital allocation strategy positions us well for long-term success. To our team members, let's continue to make 2025 the safest year in our history. We thank you, our shareholders and our customers, for the trust you place in us each and every day and with every order. Have a great day.

Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.