Analysis of Reportable Segments
Steel Dynamics Inc. operates in 3 segments: Steel operations; Metals recycling operations; and Steel fabrication operations.
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- Statement of Comprehensive Income
- Cash Flow Statement
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Profitability Ratios
- Analysis of Short-term (Operating) Activity Ratios
- Selected Financial Data since 2005
- Operating Profit Margin since 2005
- Price to Earnings (P/E) since 2005
- Price to Book Value (P/BV) since 2005
- Price to Sales (P/S) since 2005
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Segment Profit Margin
Steel Dynamics Inc., profit margin by reportable segment
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Steel operations | |||||
| Metals recycling operations | |||||
| Steel fabrication operations |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
- Steel Operations Profit Margin
- The profit margin for steel operations exhibits notable fluctuation over the reported years. Starting at 14.14% in 2017, it increased significantly to 19.12% in 2018. However, there was a considerable decline to 11.7% in 2019, closely maintained at 11.17% in 2020. A marked recovery is evident in 2021, with the margin rising sharply to 30.86%, more than doubling the figure from 2020 and achieving the highest margin in the period.
- Metals Recycling Operations Profit Margin
- The metals recycling operations segment demonstrates relatively low and fluctuating profit margins. The margin slightly decreased from 2.3% in 2017 to 2.18% in 2018, followed by a more significant drop to 0.46% in 2019. This was succeeded by a gradual recovery to 1.15% in 2020 and a stronger improvement to 3.96% in 2021, indicating some stabilization and enhancement in profitability by the end of the period.
- Steel Fabrication Operations Profit Margin
- Steel fabrication operations show a mixed but overall positive trend. The margin declined from 9.83% in 2017 to 6.1% in 2018, but then rebounded to 11.87% in 2019 and further increased to 12.87% in 2020. The most significant growth is observed in 2021, with the margin climbing to 20.54%, representing a considerable upward trend over the last three years.
- Overall Insights
- Across all segments, 2021 stands out as a year of strong profit margin improvement, especially for steel operations and steel fabrication operations. The steel operations segment displays the most pronounced volatility but ends on a very high note. Metals recycling, while consistently the least profitable segment, shows some signs of recovery after previous declines. The varying profit margins suggest differing operational challenges and market factors impacting each segment differently over the five-year period.
Segment Profit Margin: Steel operations
Steel Dynamics Inc.; Steel operations; segment profit margin calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Income (loss) before income taxes | |||||
| Net sales | |||||
| Segment Profitability Ratio | |||||
| Segment profit margin1 | |||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Segment profit margin = 100 × Income (loss) before income taxes ÷ Net sales
= 100 × ÷ =
- Income (loss) before income taxes
- The pre-tax income exhibited a fluctuating trend during the observed periods. Beginning at 1,014,863 thousand USD in 2017, it increased significantly to 1,770,888 thousand USD in 2018. However, this was followed by a decline in the subsequent two years, reaching 833,035 thousand USD in 2020. The year 2021 showed a pronounced recovery and substantial growth, with pre-tax income rising sharply to 4,327,300 thousand USD, the highest value in the series.
- Net sales
- Net sales demonstrated variability over the five-year span. Sales rose markedly from 7,175,409 thousand USD in 2017 to 9,263,152 thousand USD in 2018. This was succeeded by a decline during 2019 and 2020, decreasing to 7,455,637 thousand USD by the end of 2020. There was a dramatic upswing in 2021, where net sales reached 14,023,133 thousand USD, nearly doubling the previous year's figure.
- Segment profit margin
- The segment profit margin showed significant fluctuations, reflecting changes in profitability relative to net sales. The margin increased from 14.14% in 2017 to 19.12% in 2018, then decreased to 11.7% in 2019 and slightly further to 11.17% in 2020. A substantial improvement occurred in 2021 when the margin surged to 30.86%, indicating enhanced cost management or pricing power contributing to this highly profitable year.
- Overall observations
- The data indicates that the segment experienced cyclical performance throughout the period, with a strong positive reversal in 2021. The substantial increases in both net sales and income before taxes in 2021, alongside a marked improvement in profit margin, suggest an exceptionally favorable market environment or operational efficiency gains during that year. The declines observed in 2019 and 2020 may reflect challenging market conditions or operational disruptions preceding the recovery.
Segment Profit Margin: Metals recycling operations
Steel Dynamics Inc.; Metals recycling operations; segment profit margin calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Income (loss) before income taxes | |||||
| Net sales | |||||
| Segment Profitability Ratio | |||||
| Segment profit margin1 | |||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Segment profit margin = 100 × Income (loss) before income taxes ÷ Net sales
= 100 × ÷ =
The financial data for the metals recycling operations segment reveals several notable trends over the five-year period from December 31, 2017, to December 31, 2021.
- Income (loss) before income taxes
- There is a fluctuating trend in pre-tax income. Starting at 64,638 thousand US dollars in 2017, the figure increased moderately to 69,861 thousand US dollars in 2018. This was followed by a significant decline to 11,432 thousand US dollars in 2019, suggesting a challenging period for the segment during that year. However, income rebounded to 27,753 thousand US dollars in 2020 and dramatically escalated to 181,579 thousand US dollars in 2021, indicating strong recovery and growth.
- Net sales
- Net sales experienced variable movement over the analyzed duration. The segment’s revenue climbed from 2,813,004 thousand US dollars in 2017 to a peak of 3,202,214 thousand US dollars in 2018. Subsequently, sales declined notably over the next two years, reaching 2,494,014 thousand US dollars in 2019 and 2,403,140 thousand US dollars in 2020, signaling reduced market activity or pricing pressures during this time. In 2021, net sales surged significantly by almost double, to 4,590,121 thousand US dollars, reflecting a strong market rebound or increased operational capacity.
- Segment profit margin
- The profit margin follows a pattern consistent with the fluctuations in income and sales. Beginning at 2.3% in 2017, it narrowly decreased to 2.18% in 2018 before dropping sharply to 0.46% in 2019, highlighting margin compression despite the reduction in sales. The margin showed improvement to 1.15% in 2020 and then expanded sharply to 3.96% in 2021. This suggests not only improved profitability but also more efficient cost management or favorable pricing conditions in the latest year.
Overall, the segment exhibited volatility in its financial performance through the years, with a notable downturn in 2019 followed by recovery and substantial growth in 2021. The combination of rising net sales and expanding profit margin in 2021 indicates a period of robust operational performance and enhanced profitability.
Segment Profit Margin: Steel fabrication operations
Steel Dynamics Inc.; Steel fabrication operations; segment profit margin calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Income (loss) before income taxes | |||||
| Net sales | |||||
| Segment Profitability Ratio | |||||
| Segment profit margin1 | |||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Segment profit margin = 100 × Income (loss) before income taxes ÷ Net sales
= 100 × ÷ =
- Income (loss) before income taxes
- There is a notable fluctuation in income before income taxes over the five-year period. After an initial decrease from $81,046 thousand in 2017 to $56,236 thousand in 2018, the figure rebounded strongly in 2019 to $114,359 thousand and slightly increased to $116,625 thousand in 2020. A significant increase occurred in 2021, with income before taxes reaching $362,473 thousand, more than triple the previous year's amount.
- Net sales
- Net sales demonstrate a generally upward trend, with some variability. Sales increased from $824,425 thousand in 2017 to $921,951 thousand in 2018, followed by a moderate rise to $963,259 thousand in 2019. However, there was a decline in 2020 to $906,364 thousand. In 2021, net sales experienced a substantial surge to $1,764,710 thousand, almost doubling the amount from the previous year.
- Segment profit margin
- The segment profit margin shows significant improvement over the period. Starting at 9.83% in 2017, it dropped to 6.1% in 2018 but increased markedly to 11.87% in 2019. This upward trajectory continued into 2020 with a margin of 12.87%, culminating in a strong margin of 20.54% in 2021, indicating enhanced profitability relative to sales.
Segment Return on Assets (Segment ROA)
Steel Dynamics Inc., ROA by reportable segment
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Steel operations | |||||
| Metals recycling operations | |||||
| Steel fabrication operations |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
The annual reportable segment Return on Assets (ROA) data demonstrates distinct patterns across the three operational segments over the five-year period from 2017 to 2021.
- Steel operations
- The ROA for steel operations exhibited considerable volatility. Starting at 23.84% in 2017, it increased significantly to 34.38% in 2018. However, there was a sharp decline over the next two years, reaching a low of 13.25% in 2020. Subsequently, 2021 marked a strong recovery with the ROA surging to 49.82%, the highest level within the observed timeframe. This suggests a cyclical or possibly market-driven dynamic affecting the segment's asset efficiency, culminating in a notable improvement by the end of the period.
- Metals recycling operations
- This segment showed generally low ROA values compared to steel operations but exhibited an overall upward trend. Starting with a modest ROA of 6.39% in 2017, the segment experienced incremental improvements, peaking slightly at 7.38% in 2018, before declining sharply to 1.22% in 2019. Following that low, the ROA rose gradually to 2.49% in 2020 and then increased substantially to 14.33% in 2021. The data indicates a period of underperformance followed by a strong recovery, which may reflect operational or market adjustments enhancing asset utilization.
- Steel fabrication operations
- The ROA for steel fabrication operations was relatively stable, with fluctuations but no extreme shifts. It started at 21.08% in 2017, declined to 13.53% in 2018, then increased markedly in 2019 to 29.59%. Through 2020 and 2021, the ROA hovered around 31%, showing 30.96% and 30.32% respectively, indicating a sustained strong performance in asset returns. This pattern suggests maturation and consistent profitability in this segment, maintaining a higher and more stable ROA compared to metals recycling.
In summary, the steel operations segment experienced significant volatility but ended with a remarkable peak in 2021. Metals recycling, while generally lower in asset returns, demonstrated a substantial rebound by the end of the period. Steel fabrication maintained a comparatively steady and robust ROA, evidencing resilience and efficient asset use. Together, these trends provide insights into the varied operational efficiencies and market conditions impacting each segment over the assessed years.
Segment ROA: Steel operations
Steel Dynamics Inc.; Steel operations; segment ROA calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Income (loss) before income taxes | |||||
| Assets | |||||
| Segment Profitability Ratio | |||||
| Segment ROA1 | |||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Segment ROA = 100 × Income (loss) before income taxes ÷ Assets
= 100 × ÷ =
- Income (loss) before income taxes
- The income before income taxes exhibited a volatile trend over the observed years. Starting from approximately $1.01 billion in 2017, there was a substantial increase to roughly $1.77 billion in 2018. However, this was followed by a notable decline to about $963 million in 2019 and further down to approximately $833 million in 2020. In 2021, a significant surge occurred, with income before income taxes reaching an all-time high of approximately $4.33 billion, highlighting a strong recovery and growth.
- Assets
- The asset base showed a consistent upward trend throughout the period. Assets increased from around $4.26 billion in 2017 to approximately $5.15 billion in 2018. Stability was observed in 2019 with assets remaining close to the 2018 level. From 2019 onwards, assets expanded notably, with $6.29 billion recorded in 2020 and a further increase to about $8.69 billion in 2021, indicating ongoing investment and expansion of operational capacity.
- Segment ROA (Return on Assets)
- The segment return on assets demonstrated considerable variability. It started at a healthy 23.84% in 2017 and reached a peak of 34.38% in 2018, signaling improved efficiency in asset utilization. Following this peak, ROA declined sharply to 18.63% in 2019 and further to 13.25% in 2020, reflecting reduced profitability relative to asset levels. In 2021, ROA rebounded dramatically to 49.82%, suggesting exceptional efficiency and profitability in asset use during that year.
Segment ROA: Metals recycling operations
Steel Dynamics Inc.; Metals recycling operations; segment ROA calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Income (loss) before income taxes | |||||
| Assets | |||||
| Segment Profitability Ratio | |||||
| Segment ROA1 | |||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Segment ROA = 100 × Income (loss) before income taxes ÷ Assets
= 100 × ÷ =
The annual data for the metals recycling operations segment indicates notable fluctuations in financial performance and asset utilization over the analyzed period from 2017 to 2021.
- Income (Loss) Before Income Taxes
- The segment experienced income before income taxes ranging from US$ 11.4 million in 2019 to a significant high of US$ 181.6 million in 2021. After a peak of approximately US$ 69.9 million in 2018, income sharply declined to its lowest point in 2019. Subsequently, there was a recovery in 2020, followed by a substantial increase in 2021, indicating strong profitability growth in the latest year reported.
- Assets
- Assets within the segment showed relative stability with minor fluctuations until 2019, hovering around US$ 940 million. There was an increase beginning in 2020, with assets rising to over US$ 1.1 billion, and further growth to approximately US$ 1.27 billion in 2021. This upward movement in assets suggests investment or expansion activities in recent years.
- Segment Return on Assets (ROA)
- Segment ROA exhibited considerable variability over the period. It started at a moderate 6.39% in 2017, improved to 7.38% in 2018, then plunged to 1.22% in 2019. The return rose modestly to 2.49% in 2020 and then surged dramatically to 14.33% in 2021. This trend indicates a period of decreased efficiency in asset utilization in 2019-2020, followed by a pronounced improvement in 2021.
Overall, the data portrays a segment that endured a challenging period in 2019 marked by reduced profitability and asset efficiency, but subsequently reclaimed and exceeded prior performance levels by 2021. The increase in assets accompanied by a significant rise in income and ROA in 2021 suggests successful strategic initiatives or favorable market conditions contributing to enhanced operational effectiveness and financial results.
Segment ROA: Steel fabrication operations
Steel Dynamics Inc.; Steel fabrication operations; segment ROA calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Income (loss) before income taxes | |||||
| Assets | |||||
| Segment Profitability Ratio | |||||
| Segment ROA1 | |||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Segment ROA = 100 × Income (loss) before income taxes ÷ Assets
= 100 × ÷ =
- Income (loss) before income taxes
- The pre-tax income exhibits a fluctuating but generally upward trend over the five-year period. Starting at $81,046 thousand in 2017, it declined in 2018 to $56,236 thousand, suggesting a temporary downturn. However, from 2019 onwards, the income steadily increased, reaching a peak of $362,473 thousand in 2021, which represents a substantial growth compared to previous years.
- Assets
- The asset base demonstrates moderate variability between 2017 and 2020, ranging from $384,402 thousand to $415,708 thousand but showing no consistent directional trend during this period. Notably, in 2021, the assets increased significantly to $1,195,396 thousand, more than tripling from the prior year. This sharp rise indicates a major expansion or investment within the segment during the latest year.
- Segment ROA (Return on Assets)
- The return on assets shows initial decline from 21.08% in 2017 to 13.53% in 2018, paralleling the drop in income seen that year. Following this, the ROA improved markedly in 2019 to 29.59% and continued to rise slightly to 30.96% in 2020, reflecting enhanced profitability relative to asset levels. In 2021, the ROA slightly decreased to 30.32% despite the large asset increase, suggesting that the return did not scale proportionally with the asset base expansion.
Segment Asset Turnover
Steel Dynamics Inc., asset turnover by reportable segment
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Steel operations | |||||
| Metals recycling operations | |||||
| Steel fabrication operations |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
- Steel operations asset turnover
- The asset turnover for steel operations displayed a fluctuating pattern over the analyzed period. Beginning at 1.69 in 2017, it increased slightly to 1.80 in 2018, indicating improved efficiency in using assets to generate revenue. However, a decline followed, dropping to 1.59 in 2019 and further to 1.19 in 2020. By 2021, there was a recovery to 1.61, suggesting a partial rebound in operational performance but still below the peak in 2018.
- Metals recycling operations asset turnover
- The metals recycling segment showed more pronounced volatility but overall strong performance. Starting at a ratio of 2.78 in 2017, it rose substantially to 3.38 in 2018, marking a significant increase in asset utilization effectiveness. This was followed by a decrease to 2.65 in 2019 and to 2.15 in 2020, indicative of declining efficiency during that period. Nevertheless, a notable improvement occurred in 2021, with the turnover ratio climbing sharply to 3.62, the highest value in the five-year span, demonstrating enhanced operational efficiency and strong utilization of assets.
- Steel fabrication operations asset turnover
- The asset turnover ratio for steel fabrication operations exhibited a relatively steady upward trend from 2017 through 2019, increasing from 2.14 to 2.49. This trajectory suggests improving efficiency in asset use during those years. The ratio then decreased slightly to 2.41 in 2020, indicating a minor decline in turnover. However, 2021 saw a significant drop to 1.48, representing a substantial reduction in asset efficiency relative to previous years.
- Overall insights
- The data reveals that metals recycling operations consistently maintained higher asset turnover ratios compared to steel operations and steel fabrication, with particularly strong peaks in 2018 and 2021. Steel operations demonstrated challenges in maintaining asset turnover, with a notable dip in 2020 followed by a partial recovery. Steel fabrication operations showed improvement early on but faced a considerable decline in efficiency in the final year observed. These trends suggest varying operational dynamics and may reflect differences in market conditions, asset management, or business strategy across segments.
Segment Asset Turnover: Steel operations
Steel Dynamics Inc.; Steel operations; segment asset turnover calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Net sales | |||||
| Assets | |||||
| Segment Activity Ratio | |||||
| Segment asset turnover1 | |||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Segment asset turnover = Net sales ÷ Assets
= ÷ =
- Net Sales
- Net sales exhibit fluctuating trends over the five-year period. Starting at approximately $7.18 billion at the end of 2017, sales increased significantly to about $9.26 billion in 2018. This was followed by a decline in 2019 to approximately $8.23 billion and a further decrease in 2020 to about $7.46 billion. However, there was a substantial rebound in 2021, with net sales rising sharply to around $14.02 billion, surpassing all prior years within the range.
- Assets
- The total assets consistently increased throughout the period under review. Beginning at roughly $4.26 billion in 2017, assets rose year over year, reaching approximately $8.69 billion by the end of 2021. This steady growth underscores ongoing investment or accumulation of resources in the segment.
- Segment Asset Turnover Ratio
- The segment asset turnover ratio illustrates the efficiency of asset utilization in generating sales revenue. The ratio was 1.69 in 2017 and increased slightly to 1.80 in 2018, indicating improved efficiency. However, this was followed by a decrease to 1.59 in 2019 and a more pronounced drop to 1.19 in 2020, suggesting reduced efficiency during this period. In 2021, the ratio rebounded to 1.61 but did not reach the peak levels observed in 2017 and 2018. The decline in 2020 may be correlated with the decline in net sales despite an increase in assets, while the 2021 improvement reflects a stronger sales performance relative to assets.
- Overall Insights
- The data indicate a period of robust growth followed by some volatility and a strong recovery in the final year. The sharp increase in net sales in 2021, coupled with the growth in total assets, suggests a strategic expansion or favorable market conditions. However, the fluctuations in the asset turnover ratio highlight variability in how efficiently assets were used to generate sales, with a notable dip in asset efficiency in 2020. This pattern may warrant further analysis into operational factors, market dynamics, or investments made during these years.
Segment Asset Turnover: Metals recycling operations
Steel Dynamics Inc.; Metals recycling operations; segment asset turnover calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Net sales | |||||
| Assets | |||||
| Segment Activity Ratio | |||||
| Segment asset turnover1 | |||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Segment asset turnover = Net sales ÷ Assets
= ÷ =
- Net Sales
- Net sales exhibited notable fluctuations over the five-year period. Starting at approximately $2.81 billion in 2017, sales increased to around $3.20 billion in 2018, followed by a decline in both 2019 and 2020, reaching a low of roughly $2.40 billion in 2020. A significant rebound occurred in 2021, with net sales surging to approximately $4.59 billion, representing the highest value in the series and a considerable increase compared to previous years.
- Assets
- Total assets showed moderate variability. The asset base slightly declined from about $1.01 billion in 2017 to approximately $947 million in 2018 and remained relatively stable through 2019. In 2020, assets increased to about $1.12 billion and further to approximately $1.27 billion in 2021, indicating a gradual asset growth trend in the later years.
- Segment Asset Turnover
- The segment asset turnover ratio, indicating the efficiency of asset utilization to generate sales, displayed considerable variation. The ratio improved from 2.78 in 2017 to a peak of 3.38 in 2018, before declining steadily to 2.65 in 2019 and further to 2.15 in 2020. In 2021, the ratio rose sharply to 3.62, the highest within the period, suggesting enhanced efficiency in asset use correlating with the significant increase in net sales during that year.
- Overall Insights
- The data indicate a period of volatility in sales performance with a sharp recovery in 2021. Asset levels remained fairly stable with modest growth towards the end of the period. Notably, the segment asset turnover ratio closely mirrors the sales trend, highlighting periods of fluctuating operational efficiency, with 2021 demonstrating a strong recovery in both revenue and asset utilization efficiency.
Segment Asset Turnover: Steel fabrication operations
Steel Dynamics Inc.; Steel fabrication operations; segment asset turnover calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Net sales | |||||
| Assets | |||||
| Segment Activity Ratio | |||||
| Segment asset turnover1 | |||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Segment asset turnover = Net sales ÷ Assets
= ÷ =
The analysis of the steel fabrication operations segment reveals several key trends over the period from 2017 to 2021.
- Net Sales
- Net sales demonstrated a generally upward trajectory with fluctuations. From 2017 to 2019, sales increased steadily from approximately 824 million to 963 million US dollars. However, there was a decline in 2020, with sales decreasing to about 906 million US dollars. This was followed by a substantial surge in 2021, where net sales nearly doubled to roughly 1.76 billion US dollars, indicating a significant expansion during that year.
- Assets
- The segment’s asset base exhibited relative stability from 2017 to 2020, fluctuating between 376 million and 416 million US dollars, but without a clear trend upwards or downwards. In 2021, assets experienced a sharp increase to approximately 1.2 billion US dollars, consistent with the surge observed in net sales during the same period. This suggests notable investments or acquisitions that expanded the asset base significantly in 2021.
- Segment Asset Turnover
- The segment asset turnover ratio, which measures the efficiency of asset use in generating sales, displayed improvement from 2.14 times in 2017 to a peak of 2.49 times in 2019. There was a slight decline to 2.41 times in 2020, likely influenced by the dip in sales at that time. However, in 2021, asset turnover decreased significantly to 1.48 times, despite the substantial increase in sales. This decline reflects that the asset base grew at a faster pace than sales, thus reducing the efficiency ratio.
In summary, the steel fabrication segment experienced steady growth in sales through 2019, a short-term setback in 2020, and then a major increase in 2021 accompanied by a substantial expansion in assets. The asset turnover ratio’s peak in 2019 followed by a sharp fall in 2021 suggests that rapid asset accumulation outpaced sales growth, potentially indicating large capital expenditures or acquisitions in 2021 that have yet to fully translate into proportional sales increases.
Segment Capital Expenditures to Depreciation
Steel Dynamics Inc., capital expenditures to depreciation by reportable segment
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Steel operations | |||||
| Metals recycling operations | |||||
| Steel fabrication operations |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
The analysis of the capital expenditures to depreciation ratios over the five-year period reveals distinctive trends across the three operational segments.
- Steel Operations
- This segment exhibits a significant upward trend from 2017 through 2020, starting at a ratio of 0.57 and peaking sharply at 4.5 in 2020. This indicates a substantial increase in capital expenditures relative to depreciation, suggesting major investments possibly aimed at expansion or modernization during this period. In 2021, the ratio declines to 3.56 but remains considerably elevated compared to earlier years, implying continued but reduced capital spending relative to asset wear and tear.
- Metals Recycling Operations
- The ratio for this segment shows moderate fluctuations. It increases from 0.53 in 2017 to 0.77 in 2018, indicating a rise in capital expenditure relative to depreciation. Thereafter, it climbs to 1.01 in 2019, suggesting capital investments slightly exceed annual depreciation. However, in 2020 the ratio falls to 0.66 and then modestly increases to 0.83 in 2021. This pattern suggests that while capital spending varies, it remains relatively close to or below depreciation levels in recent years, highlighting a more conservative or maintenance-focused investment approach.
- Steel Fabrication Operations
- This segment demonstrates a gradual increase in the capital expenditures to depreciation ratio from 0.65 in 2017 to 1.41 in 2020, reflecting progressively higher investment relative to asset depreciation. In 2021, the ratio slightly decreases to 1.3, which still indicates investment levels exceeding written-down asset values. The upward trend over the period suggests ongoing capital investment with a relatively stable and controlled expansion pace.
Overall, the data indicates that steel operations have seen the most aggressive capital investment relative to depreciation in recent years, particularly in 2020, potentially signaling strategic growth initiatives. Metals recycling shows modest and stable capital expenditure patterns in relation to depreciation, with investments generally in line with asset depreciation. Steel fabrication follows a steady upward trend in this ratio, suggesting consistent reinvestment efforts.
Segment Capital Expenditures to Depreciation: Steel operations
Steel Dynamics Inc.; Steel operations; segment capital expenditures to depreciation calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Capital expenditures | |||||
| Depreciation and amortization | |||||
| Segment Financial Ratio | |||||
| Segment capital expenditures to depreciation1 | |||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Segment capital expenditures to depreciation = Capital expenditures ÷ Depreciation and amortization
= ÷ =
- Capital Expenditures
- The capital expenditures demonstrated notable volatility over the five-year period. Starting at $128.7 million in 2017, there was a steady increase to $189.2 million in 2018, followed by a sharp acceleration to $385.1 million in 2019. The most significant rise occurred in 2020, with capital expenditures surging to approximately $1.13 billion, marking nearly a threefold increase from the previous year. In 2021, capital expenditures declined to $937.0 million but remained substantially higher than the levels recorded prior to 2020.
- Depreciation and Amortization
- Depreciation and amortization expenses showed a relatively stable pattern throughout the five years. Beginning at $227.8 million in 2017, the amount slightly increased each year, reaching $263.1 million in 2021. The growth was steady but modest, with total expenses increasing by approximately 15% over the entire period.
- Segment Capital Expenditures to Depreciation Ratio
- The ratio of capital expenditures to depreciation revealed significant changes, reflecting shifts in investment intensity relative to asset consumption. The ratio was 0.57 in 2017, indicating capital expenditures were below depreciation. The ratio climbed gradually to 0.76 in 2018 and almost doubled to 1.53 in 2019. It peaked sharply at 4.5 in 2020, coinciding with the surge in capital expenditures, and slightly declined to 3.56 in 2021. This elevated ratio in the last two years suggests aggressive investment activities far outpacing depreciation expenses.
Segment Capital Expenditures to Depreciation: Metals recycling operations
Steel Dynamics Inc.; Metals recycling operations; segment capital expenditures to depreciation calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Capital expenditures | |||||
| Depreciation and amortization | |||||
| Segment Financial Ratio | |||||
| Segment capital expenditures to depreciation1 | |||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Segment capital expenditures to depreciation = Capital expenditures ÷ Depreciation and amortization
= ÷ =
- Capital Expenditures
- Capital expenditures for the segment exhibited a generally increasing trend over the five-year period. Starting at approximately $26.0 million in 2017, expenditures rose significantly to about $35.5 million in 2018 and further increased to nearly $47.0 million in 2019. There was a decline in 2020, with capital expenditures dropping to around $32.9 million, followed by a substantial rebound to approximately $46.4 million in 2021.
- Depreciation and Amortization
- Depreciation and amortization expenses demonstrated a relatively steady upward trajectory across the periods. The values moved from about $48.8 million in 2017 to a slight decline in 2018 at $46.0 million, then a minor increase in 2019 to $46.5 million. From there, the expense rose more noticeably to approximately $50.1 million in 2020 and reached $55.6 million in 2021.
- Segment Capital Expenditures to Depreciation Ratio
- The ratio of capital expenditures to depreciation showed fluctuations reflecting changes in investment relative to asset consumption. Beginning at 0.53 in 2017, the ratio increased significantly to 0.77 in 2018 and crossed the threshold of 1.00, reaching 1.01 in 2019, indicating capital spending exceeded depreciation. The ratio then decreased to 0.66 in 2020 but rose again to 0.83 in 2021, suggesting ongoing substantial reinvestment albeit below the depreciation level.
- Overall Trends and Insights
- The capital expenditures pattern indicates strategic investment phases with peaks in 2019 and 2021, interrupted by a dip in 2020, potentially attributable to external factors affecting spending decisions. Depreciation and amortization show a steady increase, consistent with asset base growth and aging. The capital expenditure to depreciation ratio’s variation highlights shifts in reinvestment intensity, with 2019 being a notable year where reinvestment fully matched asset wear and tear. Subsequent years show continued but moderated investment, implying a balance between maintaining and expanding asset capacity within the segment.
Segment Capital Expenditures to Depreciation: Steel fabrication operations
Steel Dynamics Inc.; Steel fabrication operations; segment capital expenditures to depreciation calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Capital expenditures | |||||
| Depreciation and amortization | |||||
| Segment Financial Ratio | |||||
| Segment capital expenditures to depreciation1 | |||||
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Segment capital expenditures to depreciation = Capital expenditures ÷ Depreciation and amortization
= ÷ =
The analysis of the steel fabrication operations segment reveals notable trends in capital expenditures, depreciation and amortization, and the ratio of capital expenditures to depreciation over the five-year period ending December 31, 2021.
- Capital Expenditures
- There is a clear upward trajectory in capital expenditures from 2017 through 2020, beginning at $7.5 million and peaking at $15.2 million in 2020. However, in 2021, capital expenditures declined to approximately $12.9 million, indicating a reduction from the prior year's investment level, though still significantly above the initial 2017 figure.
- Depreciation and Amortization
- Depreciation and amortization expenses remained relatively stable from 2017 to 2019, fluctuating slightly around the $11.5 to $11.7 million range. A downward trend is observed beginning in 2020, with expenses declining to roughly $10.8 million in 2020 and further to just under $10 million in 2021. This decrease suggests either a reduction in the depreciable asset base or changes in depreciation methods or asset mix.
- Segment Capital Expenditures to Depreciation Ratio
- The ratio of capital expenditures to depreciation illustrates the relationship between new investments and the expensing of existing assets. Starting at 0.65 in 2017, the ratio increases steadily through the period, surpassing parity in 2019 (1.06) and peaking at 1.41 in 2020. Although it falls slightly to 1.3 in 2021, the elevated levels imply that capital investments consistently outpaced depreciation expenses in the latter years, signaling growth and asset base expansion during the period analyzed.
Net sales
Steel Dynamics Inc., net sales by reportable segment
US$ in thousands
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Steel operations | |||||
| Metals recycling operations | |||||
| Steel fabrication operations | |||||
| Other | |||||
| Eliminations | |||||
| Consolidated |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
The net sales data over the five-year period exhibits distinct trends among the various operational segments, culminating in the consolidated results.
- Steel Operations
-
This segment demonstrated fluctuating net sales throughout the period. Sales increased significantly from approximately 7.2 billion USD in 2017 to over 9.2 billion USD in 2018. However, this was followed by a decline in the subsequent two years, reaching about 7.5 billion USD in 2020. A sharp and substantial rebound occurred in 2021, with net sales nearly doubling year-over-year to exceed 14 billion USD, marking the highest value in the dataset.
- Metals Recycling Operations
-
This segment showed a relatively stable but declining trend from 2017 through 2020. Net sales decreased from approximately 2.8 billion USD in 2017 to around 2.4 billion USD by 2020. In 2021, the segment reversed this downward trend with a marked increase in net sales to over 4.5 billion USD, almost doubling compared to the previous year, indicating a strong recovery or an expansion in this line of business.
- Steel Fabrication Operations
-
The steel fabrication segment experienced gradual growth on net sales from about 824 million USD in 2017 to near 963 million USD in 2019. A slight dip occurred in 2020, decreasing to roughly 906 million USD. This was followed by a sharp increase in 2021, where net sales almost doubled to approximately 1.76 billion USD. This pattern suggests a stable base with a significant surge in activity or sales in the latest year.
- Other
-
The 'Other' category exhibited moderate growth from 375 million USD in 2017 to just over 429 million USD in 2018, followed by a slight decline in 2019 to approximately 401 million USD. In contrast, 2020 posted an increase to around 501 million USD. The most pronounced growth occurred in 2021, with net sales more than doubling to almost 1.27 billion USD. This suggests either diversification or increased activity from ancillary operations starting in the latest year.
- Eliminations
-
The eliminations line, reflecting inter-segment transactions, maintained negative values throughout, as expected. The absolute value of eliminations increased over time, from approximately -1.65 billion USD in 2017 to roughly -3.24 billion USD in 2021. This indicates an increasing volume of internal transactions across segments, which could be the result of expanded inter-segment sales or operational interdependencies growing in scale.
- Consolidated
-
The consolidated net sales, after accounting for eliminations, generally mirrored the underlying segment trends. There was a notable increase from around 9.5 billion USD in 2017 to 11.8 billion USD in 2018, followed by a decline through 2020 down to 9.6 billion USD. In 2021, net sales surged dramatically to over 18.4 billion USD, a near doubling from the prior year and representing the highest point in the dataset. This pronounced increase was supported by strong recoveries and growth across all major segments, as well as amplified sales activities reflected by higher elimination values.
Overall, the data reveals a pattern of growth and contraction across the majority of segments until 2020, followed by significant and widespread recovery or expansion in 2021. The sharp increases in 2021, both in individual segments and consolidated figures, suggest improved market conditions, operational scaling, or possibly strategic initiatives impacting sales performance positively across the company's operations.
Income (loss) before income taxes
Steel Dynamics Inc., income (loss) before income taxes by reportable segment
US$ in thousands
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Steel operations | |||||
| Metals recycling operations | |||||
| Steel fabrication operations | |||||
| Other | |||||
| Eliminations | |||||
| Consolidated |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
- Steel Operations
- The segment income before income taxes from steel operations shows a volatile trend over the five-year period. It increased significantly from approximately 1.01 billion USD in 2017 to 1.77 billion USD in 2018. This was followed by a notable decline in 2019 and 2020, dropping to around 963 million USD and 833 million USD respectively. However, there was a sharp recovery in 2021, with income surging to approximately 4.33 billion USD, indicating a substantial improvement and possible expansion or favorable market conditions.
- Metals Recycling Operations
- The income from metals recycling operations displays a mixed pattern. It remained relatively stable from 2017 to 2018, around 65-70 million USD, then declined sharply in 2019 to roughly 11 million USD. Some recovery is observed in 2020 with an increase to about 28 million USD, followed by a strong jump in 2021 reaching nearly 182 million USD. This suggests operational challenges in 2019 with a significant rebound thereafter.
- Steel Fabrication Operations
- The steel fabrication segment income experiences fluctuations with an initial decrease from approximately 81 million USD in 2017 to 56 million USD in 2018. This was succeeded by an upward trend starting in 2019, rising to around 114 million USD and remaining steady in 2020. In 2021, income more than tripled to approximately 362 million USD. The pattern indicates growth and strengthening profitability in recent years.
- Other
- The "Other" category consistently reflects negative values, implying losses or expenses that offset segment incomes. These losses increased in magnitude from about -226 million USD in 2017 to nearly -606 million USD in 2021, showing a worsening trend. The growing losses suggest increased costs or adverse impacts within items categorized here, which may affect overall profitability.
- Eliminations
- Eliminations, representing internal adjustments, fluctuated over the years with minor absolute values compared to other segments. The values oscillated between positive and negative, with a significant negative spike in 2021 at -56 million USD, indicating larger internal offsets or consolidate adjustments in that year.
- Consolidated
- The consolidated income before income taxes mirrors the trends of the main operating segments but incorporates the effects of "Other" and eliminations. The consolidated income rose from about 935 million USD in 2017 to over 1.6 billion USD in 2018, then contracted in 2019 and 2020 to approximately 875 million USD and 705 million USD respectively. It rebounded strongly in 2021 to about 4.21 billion USD, closely reflecting the surge in steel operations and improved outcomes in other segments despite increased losses in "Other".
- Summary
- Overall, the company experienced significant volatility in segment income before income taxes over the five-year period. The steel operations segment is the primary driver of income, showing a strong recovery in 2021 after declines in the preceding two years. Metals recycling and steel fabrication operations also demonstrated recovery and growth in the latter years. The "Other" category represents a consistent and growing offset to income, which may warrant further investigation. The consolidated figures reflect the combined impact of these trends, indicating notable operational resilience and expansion in the most recent year analyzed.
Depreciation and amortization
Steel Dynamics Inc., depreciation and amortization by reportable segment
US$ in thousands
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Steel operations | |||||
| Metals recycling operations | |||||
| Steel fabrication operations | |||||
| Other | |||||
| Consolidated |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
Capital expenditures
Steel Dynamics Inc., capital expenditures by reportable segment
US$ in thousands
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Steel operations | |||||
| Metals recycling operations | |||||
| Steel fabrication operations | |||||
| Other | |||||
| Consolidated |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
Assets
Steel Dynamics Inc., assets by reportable segment
US$ in thousands
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Steel operations | |||||
| Metals recycling operations | |||||
| Steel fabrication operations | |||||
| Other | |||||
| Eliminations | |||||
| Consolidated |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).