STEEL DYNAMICS INC Q4 FY2025 earnings call

• Mark highlighted 2025's solid financial and operational performance, including record steel shipments of 13.7 million tonnes, cash from operations of $1.4 billion, adjusted EBITDA of $2.2 billion, and strong safety performance. • Sinton achieved consistent operational execution with downstream value-add coating and pre-paint product quality maturing. • Aluminum Dynamics produced and shipped finished aluminum flat-rolled products for various markets with strong momentum as commissioning continued. • The company completed the acquisition of New Process Steel in December. • Mark discussed the proposed offer to purchase BlueScope but it was rejected by the BlueScope board. • Theresa mentioned 2025 operating income of $1.5 billion, net income of $1.2 billion or $7.99 per diluted share, cash flow from operations of $1.4 billion, and liquidity over $2.2 billion. • Barry noted steel fabrication operations performed well with a solid backlog, metals recycling operations increased operating income by almost 30%, and the steel team had record shipments with higher utilization due to value-added diversification.

In 2025, Steel Dynamics' steel operations achieved an operating income of $1.4 billion. The metals recycling operations saw a full-year operating income of $97 million, which was nearly 30% higher than 2024 results due to improved pricing, volume, and operating efficiencies. The steel fabrication platform had a full-year earnings of $407 million. For the aluminum business, the team was EBITDA positive in December with 10,000 metric tons of shipments. Fourth quarter 2025 revenue was $4.4 billion, net income was $266 million or $1.82 per diluted share. Cash flow from operations for the full year was $1.4 billion.

• Mark stated the aluminum mill is expected to reach 90% utilization by the end of 2026, earlier than previous expectations. • Theresa mentioned capital investments for 2026 are expected to be in the range of $600 million. • Mark expressed confidence in the aluminum business's earnings differentiation, with a through cycle EBITDA expectation of $650 million to $700 million for the mill itself plus another $40 to $50 million for the omni platform.

• Operational risks such as the transformer failure at the Sinton facility. • Uncertainties related to the BlueScope transaction, including the board's rejection of the offer and associated execution risks.

Q: Katja Jancic asked about the aluminum rolling mill's utilization and profitability.

A: Mark said the mill is expected to reach 90% utilization by 2026 and Theresa mentioned the positive EBITDA profile will continue through the year with improvements in the first half and product mix optimization in the second half.

Q: Lawson Winder asked about debt and investment limits.

A: Theresa said the balance sheet has considerable capacity, aiming to be less than two times net realized basis, and there's room to move with structural EBITDA improving.

Q: Tristan Gresser asked about aluminum utilization and margins.

A: Theresa said current market factors give an advantage over through cycle modeling but still working through start-up. Barry talked about the transformer failure at Sinton and resolution.

Q: Timna Tanners asked about the $1.4 billion structural contribution and Sinton.

A: Theresa outlined the breakdown of the $1.4 billion and Barry discussed the value-added lines operating well due to winning cases against dumped material.

Q: Bill Peterson asked about Sinton outages and first quarter impact.

A: Barry said no planned maintenance in first quarter, outages are part of strategic asset care.

Q: Philip Ross Gibbs asked about stock buyback and energy costs.

A: Theresa said no regulatory issues on stock buyback and Barry discussed energy contracts and management of energy costs.

Q: John Tumazos asked about hot rolled aluminum automotive products and capabilities.

A: Mark explained hot band is converted by others and the first cash line is due end of first quarter.

Q: Lawson Winder asked about aluminum capacity expansion and dividend.

A: Mark said aluminum is a growth platform and Theresa said dividend will be increased with structural cash flow growth.

Q: Philip Ross Gibbs asked about increased confidence in aluminum utilization.

A: Mark and Theresa discussed the more forgiving nature of aluminum production system leading to higher confidence.

Q: Carlos De Alba asked about working capital and future CapEx.

A: Theresa said working capital has slight fluctuations with profit sharing in first quarter and no specific material projects named beyond 2026