Nucor Corporation

Company Overview

Business Model: Nucor Corporation manufactures steel and steel products, and produces and procures ferrous and non-ferrous materials primarily for its steel manufacturing business. The Company is North America’s largest recycler, utilizing scrap steel as the primary raw material in its steel production, recycling approximately 18 million gross tons in 2024. Nucor Corporation's operations also include international trading and sales companies. The Company reports its results in three segments: steel mills, steel products, and raw materials, with the steel mills segment being the largest, representing 61% of sales to external customers in 2024. Products are marketed mainly through in-house sales forces and internal distribution and trading companies, serving end-use markets such as nonresidential construction, durable goods, and capital spending.

Market Position: Nucor Corporation is a leading domestic provider for most of the products it supplies, and in many cases, such as structural steel, merchant bar steel, steel joist and deck, pre-engineered metal buildings, steel piling, cold finish bar steel, steel electrical conduit pipe, and insulated metal panels, it is the leading supplier. The Company's Electric Arc Furnace ("EAF") based steelmaking method offers a competitive advantage due to its lower greenhouse gas ("GHG") intensity, which is one third of the average traditional extractive steelmaking process. Nucor Corporation leverages this advantage with branded product lines like AEOS TM (high-strength, low-alloy steel beams), ECONIQ TM (net zero carbon steel), and Elcyon TM (sustainable heavy gauge steel plate for wind energy). The Company maintains strong credit ratings in the North American steel sector (A-/A-/Baa1) with stable outlooks from Standard & Poor’s and Fitch Ratings, and a positive outlook from Moody’s.

Recent Strategic Developments: Nucor Corporation has pursued a strategy to "Grow the Core, Expand Beyond and Live Our Culture," investing approximately $11.84 billion over the last three years (63% in capital expenditures and the remainder in acquisitions).

• Steel Mills Segment:
  • Completed modernization and expansion of the Gallatin flat-rolled sheet mill in July 2022, increasing annual production capability from approximately 1.6 million tons to 2.8 million tons.
  • Completed construction of a $1.70 billion state-of-the-art plate mill in Brandenburg, Kentucky, which began shipping in Q1 2023 and is expected to produce approximately 1.2 million tons per year.
  • Initiated construction of a new state-of-the-art sheet mill in Mason County, West Virginia, in Q3 2023, expected to be completed by the end of 2026. The project's total cost estimate increased to approximately $4 billion, with Nucor Corporation's net cash outlay expected to be approximately $3.65 billion after a $350 million state commitment. This mill is expected to have an annual production capacity of approximately 3.0 million tons.
  • Acquired a 51% controlling ownership position in California Steel Industries, Inc. in February 2022 for $400 million, expanding its sheet mill group's reach to the west coast and increasing exposure to value-added sheet steel.
  • Announced a new rebar micro mill in Lexington, North Carolina, in April 2022, a $440 million investment with an annual capacity of approximately 430,000 tons, expected to be operational in 2025.
  • Approved $860 million in February 2024 to construct a rebar micro mill in the Pacific Northwest.
• Steel Products Segment (Expand Beyond Strategy):
  • Expanded steel racking capabilities with the acquisition of Elite Storage Solutions for $75 million in April 2022 and Southwest Data Products, Inc. for $115 million in April 2024, enhancing offerings for the data center market.
  • Acquired C.H.I. Overhead Doors, LLC in June 2022 for approximately $3 billion, a leading manufacturer of overhead doors for residential and commercial markets.
  • Acquired Rytec Corporation in July 2024 for $565 million, a manufacturer of high-speed, high-performance commercial doors, to complement C.H.I. Overhead Doors, LLC.
  • Acquired Summit Utility Structures LLC and Sovereign Steel Manufacturing LLC in August 2022, forming Nucor Towers & Structures, which produces metal poles and steel structures for utility infrastructure. New manufacturing locations for Nucor Towers & Structures are under construction in Decatur, Alabama, Crawfordsville, Indiana (expected 2025), and Brigham City, Utah.
• Raw Materials Segment:
  • Focused investments on Direct Reduced Iron ("DRI") production facilities and scrap yards, along with access to international raw materials markets, to optimize raw material supply and costs.
  • Expanded natural gas production operations to partially offset exposure to natural gas price changes.
  • Universal Industrial Gases provides the capability to build and operate air separation units for steel mills, with six plants operating and eight others in various stages.

Geographic Footprint: Nucor Corporation's primary operational regions and customer base are located in North America, including the United States, Canada, and Mexico. The Company also has international exposure through its international trading and sales companies, a DRI plant in Trinidad (Nu-Iron Unlimited), and various brokerage offices and operating facilities in other foreign locations. Joint ventures like Steel Technologies LLC and Nucor-JFE Steel Mexico, S. de R.L. de C.V. also extend its presence across North America.

Financial Performance

Revenue Analysis

Profitability Metrics (2024):

• Gross Margin: 13.3%
• Operating Margin: 9.4%
• Net Margin: 6.6%

Investment in Growth:

• Capital Expenditures: $3.17 billion (2024)
• Strategic Investments:
  • Acquisitions (net of cash acquired): $758 million in 2024, including Rytec Corporation ($565 million) and Southwest Data Products, Inc. ($115 million).
  • Major capital projects in progress include the sheet mill in West Virginia, the sheet mill expansion in Indiana, and the rebar micro mill in North Carolina. Capital expenditures for 2025 are estimated to be approximately $3.00 billion.

Business Segment Analysis

Steel Mills Segment

Financial Performance:

• Revenue: $18.73 billion (-7% YoY)
• Operating Margin: 9.66% (2024) vs 14.90% (2023)
• Key Growth Drivers: The decrease in revenue was primarily due to a 7% decrease in the average sales price per ton, from $1,084 in 2023 to $1,013 in 2024. Average selling prices for sheet, bar, structural, and plate mills decreased. Metal margins decreased as the decline in average selling prices outpaced the 6% decrease in average scrap and scrap substitute costs (from $421/gross ton in 2023 to $394/gross ton in 2024). Pre-operating and start-up costs for new facilities increased to $594 million in 2024 (from $400 million in 2023), primarily related to the Kentucky plate mill, West Virginia sheet mill, and Arizona melt shop. Outside steel shipments were 18.48 million tons in 2024, comparable to 2023. The segment's utilization rate was approximately 76% in 2024.

Product Portfolio:

• Produces sheet steel (hot-rolled, cold-rolled, galvanized), plate steel, structural steel (wide-flange beams, beam blanks, H-piling, sheet piling), and bar steel (blooms, billets, concrete reinforcing bar, merchant bar, engineered special bar quality ("SBQ")).
• Branded products include AEOS TM high-strength, low-alloy steel beams, ECONIQ TM net zero carbon steel, and Elcyon TM sustainable heavy gauge steel plate.

Market Dynamics:

• Products are sold primarily to steel service centers, fabricators, and manufacturers in the United States, Canada, and Mexico.
• Markets are largely tied to nonresidential construction, durable goods, and capital spending.
• Contract sales are significant in sheet operations, accounting for over 80% of sheet steel sales in 2024, with noncancellable agreements typically ranging from six to 12 months and incorporating monthly or quarterly price adjustments. The balance of sales are in the spot market.

Sub-segment Breakdown:

• Sheet: $9.25 billion revenue (2024). Operates six sheet mills with an estimated capacity of approximately 14.6 million tons per year, including California Steel Industries, Inc. (51% owned). Nucor-JFE Steel Mexico, S. de R.L. de C.V. (51% owned joint venture) operates a galvanized sheet steel plant in central Mexico with an annual capacity of approximately 400,000 tons.
• Bar: $5.19 billion revenue (2024). Has 15 bar mills with an estimated capacity of approximately 9.56 million tons per year, producing a broad range of products for diverse end markets. A new rebar micro mill in Lexington, North Carolina, is under construction with an expected annual capacity of 430,000 tons.
• Structural: $2.28 billion revenue (2024). Operates two structural mills with an estimated capacity of approximately 3.25 million tons per year, including Nucor-Yamato Steel Company (Limited Partnership) (51% owned), the only North American producer of high-strength, low-alloy beams.
• Plate: $2.02 billion revenue (2024). Operates three plate mills with an estimated capacity of approximately 3.6 million tons per year. The new Brandenburg, Kentucky plate mill is expected to produce 1.2 million tons per year.

Steel Products Segment

Financial Performance:

• Revenue: $10.08 billion (-21% YoY)
• Operating Margin: 15.00% (2024) vs 26.06% (2023)
• Key Growth Drivers: The decrease in revenue was due to a 12% decrease in the average sales price per ton (from $2,845 in 2023 to $2,510 in 2024) and a 10% decrease in volumes. The segment experienced decreased profitability across most businesses, with the largest impact from joist and deck businesses as average selling prices and volumes moderated from historically high levels. The segment's utilization rate was approximately 58% in 2024.

Product Portfolio:

• Produces steel joists and joist girders, steel deck, galvanized torque tubes, hollow structural section ("HSS") steel tubing, electrical conduit, fabricated concrete reinforcing steel, cold finished steel, steel fasteners, steel grating and expanded metal, wire and wire mesh, metal building systems, insulated metal panels, steel racking, overhead doors, and utility towers and structures.

Market Dynamics:

• Primarily serves the nonresidential construction and infrastructure markets, with door technologies also serving the garage door repair and replacement market.
• Sales of steel joists, joist girders, and steel decking are dependent on the nonresidential building construction market. Products are made to customer specifications and typically delivered directly to construction sites.

Sub-segment Breakdown:

• Joist: $1.23 billion revenue (2024), with sales of 391,000 tons (-23% YoY). Annual production capacity is approximately 745,000 tons.
• Deck: $998 million revenue (2024), with sales of 321,000 tons (-20% YoY). Annual production capacity is approximately 560,000 tons.
• Rebar Fabrication: $1.78 billion revenue (2024), with sales of 1.02 million tons (-13% YoY). Operates nearly 70 fabrication facilities across the United States and Canada, with a total annual capacity of approximately 1.74 million tons.
• Tubular Products: $1.29 billion revenue (2024), with sales of 856,000 tons (-10% YoY). Operates eight facilities producing HSS steel tubing, mechanical steel tubing, galvanized solar torque tube, and electrical conduit.
• Building Systems: $1.35 billion revenue (2024), with sales of 238,000 tons (-4% YoY). Leading supplier of pre-engineered metal buildings under brands like Nucor Building Systems, American Buildings Company, and Kirby Building Systems.
• Other Steel Products: $3.44 billion revenue (2024). Includes insulated metal panels (CENTRIA, Metl-Span), steel racking (Nucor Racking Group, expanded by acquisitions of Elite Storage Solutions and Southwest Data Products, Inc.), overhead doors (C.H.I. Overhead Doors, LLC and Rytec Corporation), and utility towers and structures (Nucor Towers & Structures).

Raw Materials Segment

Financial Performance:

• Revenue: $1.92 billion (+3% YoY)
• Operating Margin: 0.30% (2024) vs 1.79% (2023)
• Key Growth Drivers: Net sales increased primarily due to increased volumes at The David J. Joseph Company’s brokerage operations. However, segment earnings decreased significantly due to decreased profitability of The David J. Joseph Company’s scrap processing operations and an $83 million impairment charge of a long-term note receivable. Approximately 93% of outside sales were from brokerage operations in 2024. The segment's utilization rate was approximately 73% in 2024.

Product Portfolio:

• Produces Direct Reduced Iron ("DRI") and, through The David J. Joseph Company and its affiliates ("DJJ"), brokers ferrous and nonferrous metals, pig iron, hot briquetted iron, and DRI. It also supplies ferro-alloys and processes ferrous and nonferrous scrap metal.
• Includes natural gas production operations and the industrial gas business, Universal Industrial Gases.

Market Dynamics:

• The David J. Joseph Company is the leading broker of ferrous scrap in North America and a global trader. Approximately 8% of the ferrous and nonferrous metals and scrap substitute tons brokered and processed in 2024 were sold to external customers, with the balance consumed internally.
• Nucor Corporation operates two DRI plants that supplied approximately 3.5 million metric tons of material to its steel mills in 2024, providing flexibility in metallic input mix.
• Natural gas produced by Nucor Corporation's operations is sold to third parties to partially offset exposure to natural gas price changes.

Capital Allocation Strategy

Shareholder Returns:

• Share Repurchases: $2.22 billion in 2024 (13.1 million shares) compared to $1.55 billion in 2023. As of December 31, 2024, approximately $1.11 billion remained available under the currently authorized share repurchase program, which was approved for up to $4.00 billion in May 2023 with no expiration date.
• Dividend Payments: $522 million in 2024, representing a total dividend of $2.16 per share, compared to $515 million ($2.04 per share) in 2023. Nucor Corporation has increased its base cash dividend every year since 1973.
• Future Capital Return Commitments: Nucor Corporation intends to return at least 40% of its net income to stockholders over time through dividends and share repurchases, having returned approximately 57% over the past three years.

Balance Sheet Position:

• Cash and Equivalents: $3.56 billion (2024)
• Total Debt: $6.95 billion (2024)
• Net Cash Position: -$2.81 billion (Net Debt) (2024)
• Credit Rating: A- (Standard and Poor’s), Baa1 (Moody’s), A- (Fitch Ratings). Outlooks are stable at S&P and Fitch, and positive at Moody’s.
• Debt Maturity Profile: Total long-term debt maturities include $1.03 billion in 2025, $65 million in 2026, $532 million in 2027, $553 million in 2028, $66 million in 2029, and $4.48 billion thereafter.
• Funded Debt to Total Capital: 24.5% as of December 31, 2024, well within the 60% covenant limit of its $1.75 billion undrawn revolving credit facility.

Cash Flow Generation:

• Operating Cash Flow: $3.98 billion (2024)
• Free Cash Flow: $806 million (2024)
• Cash Conversion Metrics: Accounts receivable turned approximately every five weeks in 2024, and inventories turned approximately every ten weeks in 2024.

Operational Excellence

Production & Service Model: Nucor Corporation's steelmaking operations utilize Electric Arc Furnaces ("EAFs") for 100% of their production, along with continuous casting and automated rolling mills, primarily using recycled scrap steel. This EAF-based process allows for easy variation of production levels to match short-term demand. The Company's steel products are often made to customer specifications and delivered directly to construction sites. Nucor Corporation maintains a highly automated operational model, which contributes to improved safety outcomes and cost efficiency.

Supply Chain Architecture: Key Suppliers & Partners:

• Scrap & Scrap Substitutes: The David J. Joseph Company and its affiliates ("DJJ") (internal), industrial plants, scrap dealers, auto wreckers, and demolition firms. Nucor Corporation also engages in closed loop recycling programs with larger customers.
• Pig Iron: Primarily sourced from overseas.
• Pelletized Iron Ore: Purchased from various international suppliers for DRI facilities.
• Energy: Third-party suppliers for electricity and natural gas.
• Technology Partners: Electra (carbon-free iron development) and Tata Steel (HIsarna technology exploration).
• Carbon Capture: ExxonMobil Corporation (for Louisiana DRI plant).
• Clean Electricity: Power Purchase Agreements with solar and wind projects.

Facility Network:

• Manufacturing: Nucor Corporation operates 15 bar mills, 6 sheet mills, 2 structural mills, and 3 plate mills across the United States, Canada, and Mexico. The steel products segment includes 7 domestic Vulcraft facilities, 9 domestic Vulcraft/Verco steel decking plants, 2 Canadian plants, 8 Nucor Tubular Products facilities, nearly 70 Nucor Rebar Fabrication facilities, Nucor Cold Finish assets in the U.S., Canada, and Mexico, Nucor Fastener's bolt-making facility in Indiana, Nucor Buildings group facilities in the U.S., two C.H.I. Overhead Doors, LLC plants, two Rytec Corporation manufacturing facilities, and Nucor Towers & Structures locations. The raw materials segment includes two DRI plants (Trinidad and Louisiana), and 74 operating facilities for DJJ across 18 states.
• Research & Development: While not explicitly detailed as separate R&D centers, Nucor Corporation's innovation efforts focus on clean electricity, carbon capture, and near-zero ironmaking technologies.
• Distribution: Utilizes internal distribution and trading companies, independent builder distribution networks for metal buildings, and professional garage door dealers for overhead doors. Skyline Steel LLC serves as a steel foundation distributor.

Operational Metrics:

• Steel mills utilization rate: 76% in 2024 (compared to 78% in 2023).
• Steel products utilization rate: 58% in 2024.
• Raw materials utilization rate: 73% in 2024.
• Average cost of scrap and scrap substitutes: $394 per gross ton in 2024 (a 6% decrease from $421 in 2023).
• Injury/Illness Rate: 0.77 in 2024 (an improvement from 0.79 in 2023), marking the safest year in Company history.
• Days Away, Restricted and Transfer ("DART") Case Rate: 0.41 in 2024 (compared to 0.36 in 2023).
• All steel mills owned and operated for over five years are ISO 14001 certified.
• EAF dust is recycled to recover valuable metals, and steel slag is beneficially reused in road materials.

Market Access & Customer Relationships

Go-to-Market Strategy: Distribution Channels:

• Direct Sales: Nucor Corporation employs in-house sales forces for its steel mills, steel products, and scrap metal products.
• Channel Partners: The Company utilizes independent builder distribution networks for its metal building systems and professional garage door dealers for its overhead door products.

Customer Portfolio:

• Nucor Corporation serves a diverse customer base and is not dependent on any single customer, with its largest single customer representing approximately 5% of sales in 2024.
• Enterprise Customers: Key customer segments include steel service centers, fabricators, and manufacturers across the United States, Canada, and Mexico. End-use markets span automotive, agricultural, construction, energy, infrastructure, machinery, metal building, railroad, recreational equipment, shipbuilding, heavy truck and trailer, pipe and tube, pressure vessel, transportation, wind towers, data centers, warehousing, retail, hospitals, and schools.
• Strategic Partnerships: Nucor Corporation has developed closed loop recycling programs with some of its larger customers to reliably source high-purity prime scrap.

Geographic Revenue Distribution:

• Nucor Corporation's most significant operations and customer base are concentrated in North America.

Growth Markets: The Company is strategically focused on expanding its presence in attractive growth markets such as data centers and renewable energy (solar and wind).

Competitive Intelligence

Market Structure & Dynamics

Industry Characteristics: The steel and metal markets in which Nucor Corporation competes are highly competitive, with numerous domestic and foreign firms. Competition is primarily based on price and service. The global steel industry faces ongoing overcapacity, with the OECD estimating global crude steel production overcapacity could reach 710 million tons in 2025. China, the largest steel-producing country, produced over 1 billion tons in 2024, accounting for approximately 53% of global steel output, and its exports of 122 million net tons in 2024 dampened steel prices worldwide. Non-market economies often feature state-subsidized or state-owned steel producers who prioritize factors other than capital returns, leading to exports at or below production costs. Finished steel imports supplied approximately 23% of U.S. demand in 2024, an increase of 3.7% from 2023. Steel also competes with alternative materials such as concrete, aluminum, plastics, composites, and wood.

Competitive Positioning Matrix:

Direct Competitors

• Primary Competitors: Domestic integrated steel producers (using blast furnaces), other domestic EAF steel mills, and foreign steel producers (many state-subsidized or state-owned).
• Competitive Overlap: Foreign competitors often benefit from lower costs due to subsidies, less stringent regulations, and favorable exchange rates, leading to significant import volatility.
• Alternative Materials: Concrete, aluminum, plastics, composites, and wood pose competitive threats, especially when steel prices rise relative to these alternatives.

Emerging Competitive Threats: China's continued investment in new steelmaking capacity in other countries (e.g., Southeast Asia, Africa) to circumvent trade duties represents an ongoing threat.

Competitive Response Strategy: Nucor Corporation's strategy focuses on "Grow the Core, Expand Beyond and Live Our Culture" through significant capital investments in value-added products, cost structure improvements, and operational flexibility. The Company leverages its EAF-based steelmaking as a lower GHG intensity advantage and develops branded product lines to meet evolving customer demands. Nucor Corporation actively supports trade remedies, such as antidumping and countervailing duties, and Section 232 tariffs, to ensure a level playing field against unfairly traded imports. The Company also invests in clean electricity, carbon capture, and near-zero ironmaking technologies to maintain its competitive edge and reduce its environmental footprint.

Risk Assessment Framework

Strategic & Market Risks

Market Dynamics:

• Global Steel Overcapacity: Persistent global steel production overcapacity, particularly from non-market economies like China, can lead to increased imports into the U.S. market at prices below production costs, negatively impacting Nucor Corporation's prices and profitability.
• Industry Cyclicality: Demand for Nucor Corporation's products is cyclical and sensitive to general economic conditions, especially in construction, energy, and automotive sectors, making the Company vulnerable to economic downturns or prolonged slow growth.
• Competition: Intense competition from other domestic and foreign steel producers, as well as alternative materials (concrete, aluminum, plastics, composites, wood), can exert downward pressure on prices and demand.
• Steel Price Volatility: Fluctuations in steel prices and the cost/availability of raw materials, particularly scrap steel, can rapidly compress or expand margins.
• Customer Preferences: Emerging customer preferences for greater product transparency and less GHG-intensive materials could disadvantage Nucor Corporation if not adequately addressed.

Operational & Execution Risks

Supply Chain Vulnerabilities:

• Raw Material Supply: Reliance on outside vendors for key consumables and raw materials (scrap, pig iron, iron ore) exposes Nucor Corporation to price volatility and supply disruptions.
• Energy Costs: The energy-intensive nature of steelmaking makes Nucor Corporation sensitive to volatile electricity and natural gas prices, which can be affected by weather, political, regulatory, and economic factors.
• Business Interruptions: Operations are subject to inherent risks such as explosions, fires, natural disasters, critical equipment failures, and transportation interruptions, which could lead to losses not fully covered by insurance.

Financial & Regulatory Risks

Market & Financial Risks:

• Capital Investment: The business requires substantial capital investment and maintenance expenditures, and capital resources may not always be adequate to meet all cash requirements.
• Asset Impairments: The accounting treatment of equity method investments, goodwill, and other long-lived assets could result in future non-cash impairment losses if fair values decline below carrying amounts.
• Tax Law Changes: Changes in U.S. tax laws and regulations could adversely affect Nucor Corporation's income tax provision and cash tax liability. Regulatory & Compliance Risks:
• Environmental Regulations: Nucor Corporation incurs significant costs to comply with federal, state, and local environmental laws (e.g., Clean Air Act, Clean Water Act, RCRA, CERCLA), and future changes or stricter enforcement could substantially increase costs.
• GHG Emissions Regulation: Regulations related to GHG emissions could increase energy costs, capital expenditures, and operating costs, or impact permits.
• Legal Proceedings: Nucor Corporation is subject to various legal proceedings and compliance risks, with potential negative outcomes, though no material adverse effect is currently expected from individual proceedings.

Geopolitical & External Risks

Geopolitical Exposure:

• Global Sourcing Risks: Sourcing scrap substitutes from politically volatile regions (e.g., Ukraine, Russia, Brazil) introduces supply chain risk.
• Trade Relations: Changes in trade policies, tariffs, and quota arrangements (e.g., Section 232 tariffs) can significantly impact market conditions and competitive dynamics. External Risks:
• Public Health Emergencies: Future pandemics or public health emergencies could negatively impact operations, supply chains, transportation networks, and customer demand.

Innovation & Technology Leadership

Research & Development Focus: Core Technology Areas:

• Clean Electricity: Nucor Corporation has invested in two companies developing next-generation nuclear power technology and is exploring ways to accelerate the deployment of these technologies on regional power grids. The Company is also a party to two Power Purchase Agreements ("PPAs") for solar and wind projects to support the transition to renewable power.
• Carbon Capture and Sequestration (CCS): An agreement with ExxonMobil Corporation was signed in 2023 to capture between 600,000 and 800,000 metric tons per year of CO2 from Nucor Corporation's DRI plant in Convent, Louisiana, with start-up expected in 2026.
• Near Zero GHG Ironmaking Technologies: Nucor Corporation has invested in Electra, a company developing a process to produce carbon-free iron from low-grade iron ores using intermittent, clean energy. The Company has also partnered with Tata Steel to explore scaling and commercializing HIsarna, a technology for producing high-purity iron from low-grade iron ore fines without coke ovens, with efficient CO2 capture potential.

Intellectual Property Portfolio:

• Patent Strategy: Not explicitly detailed in the filing.
• Licensing Programs: Not explicitly detailed in the filing.
• IP Litigation: Not explicitly detailed in the filing.

Technology Partnerships:

• Strategic Alliances: Nucor Corporation has strategic alliances with ExxonMobil Corporation for carbon capture, Electra for carbon-free iron development, and Tata Steel for HIsarna technology.

Leadership & Governance

Executive Leadership Team

Leadership Continuity: Nucor Corporation emphasizes internal development, with senior management having direct experience running mills and operational divisions. This approach fosters an entrepreneurial mindset and a strong sense of personal responsibility. Board Composition: The Audit Committee of the Board of Directors is responsible for cybersecurity risk oversight and is composed of directors with diverse experience, including risk management, controls, and technology.

Human Capital Strategy

Workforce Composition:

• Total Employees: Approximately 32,700 teammates as of December 31, 2024.
• Geographic Distribution: The vast majority of teammates are located in the United States, with a small number outside of North America.
• Skill Mix: Nucor Corporation's operations are highly automated, which contributes to improved safety and efficiency.

Talent Management: Acquisition & Retention:

• Hiring Strategy: The Company focuses on recruiting and hiring qualified and talented individuals.
• Retention Metrics: Nucor Corporation reports low teammate turnover.
• Employee Value Proposition: Compensation is highly competitive and structured around a "Pay-for-Performance" system, where a significant portion of earnings is based on productivity, including group incentives and a 10% contribution of pre-tax earnings to a profit-sharing plan for most teammates below the officer level. Diversity & Development:
• Diversity Metrics: Nucor Corporation believes that a diversity of perspectives and backgrounds facilitates its culture and success.
• Development Programs: The Company provides educational and on-the-job training, in addition to safety training. Senior management is expected to have direct experience running Nucor Corporation's mills and operational divisions.
• Culture & Engagement: Nucor Corporation's culture is built on safety, integrity, trust, innovation, open communication, teamwork, inclusion, courage, a can-do attitude, and ownership. Teammate surveys are conducted every three years, with the most recent in 2022 showing 89% favorable responses in "Satisfaction & Commitment." Initiatives include focused discussion groups, enhanced training, webcasts by diverse senior leaders, and engagement with external partners like the National Society of Black Engineers and the Society of Women Engineers.

Environmental & Social Impact

Environmental Commitments: Climate Strategy:

• Emissions Targets: Nucor Corporation announced net-zero, science-based greenhouse gas ("GHG") targets for 2050 and an interim emissions reduction target for 2030. These targets encompass Scope 1, 2, and 3 emissions from hot rolled steel production and are certified by the Global Steel Climate Council’s ("GSCC") “Steel Climate Standard.”
• Carbon Neutrality: The Company is committed to achieving net-zero by 2050.
• Renewable Energy: Nucor Corporation has invested in two companies developing next-generation nuclear power technology and is exploring their deployment. It is also a party to two Power Purchase Agreements ("PPAs") for solar and wind projects, which provide Renewable Energy Credits ("RECs") to offset GHG emissions.
• Nucor Corporation's EAF-based steelmaking process has one third the GHG emissions intensity of the average traditional extractive steelmaking process.
• Plans to achieve goals include increasing clean electricity use, deploying carbon capture and sequestration where practical, and developing near-zero GHG ironmaking technologies.

Supply Chain Sustainability:

• Responsible Sourcing: Nucor Corporation recycles all but a small fraction of the EAF dust it collects to recover valuable metals. Steel slag, a co-product, is beneficially reused in road materials.

Social Impact Initiatives:

• Product Impact: Branded products like AEOS TM beams offer environmental impact savings, and ECONIQ TM (net zero carbon steel) and Elcyon TM (sustainable heavy gauge steel plate for wind energy) address customer demand for lower GHG materials.
• Nucor Corporation has adopted a comprehensive Human Rights Policy, Standards of Business Conduct and Ethics, Code of Ethics for Senior Financial Professionals, Supplier Code of Conduct, and a Policy on Eliminating Forced Labor from its Supply Chain.

Business Cyclicality & Seasonality

Demand Patterns: Demand for most of Nucor Corporation's products is cyclical and sensitive to general economic conditions, particularly in high interest rate-sensitive construction sectors. The Company's business supports cyclical industries such as construction, energy, metals service centers, appliance, and automotive. In 2024, steel market demand softened due to these factors and economic/political uncertainty.

Planning & Forecasting: Nucor Corporation manages scrap inventory levels at its steel mills to match anticipated demand over several weeks and can easily vary its production levels to align with short-term changes in demand, leveraging its EAF-based steelmaking process.

Regulatory Environment & Compliance

Regulatory Framework: Industry-Specific Regulations: Nucor Corporation's operations are subject to numerous federal, state, and local laws and regulations, primarily enforced by the Occupational Safety and Health Administration ("OSHA") for workplace safety and the Environmental Protection Agency ("EPA") for environmental protection. Key federal environmental laws include the Clean Air Act ("CAA"), Clean Water Act ("CWA"), Resource Conservation and Recovery Act ("RCRA"), and Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA").

• EAFs are noted as the most efficient and cleanest steelmaking process commercially available, with significantly lower emissions compared to blast furnaces.
• EAF dust, initially classified as hazardous waste, is recycled to recover valuable metals.
• Steel slag is beneficially reused in road materials.
• Nucor Corporation maintains water withdrawal and discharge permits under the CWA. International Compliance: The Company is subject to multi-jurisdictional requirements, including in Canada, Trinidad & Tobago, and other state and local jurisdictions for tax purposes. Trade & Export Controls: Many countries restrict the export of scrap, which can create an artificial competitive advantage for foreign producers. Trade remedies, such as antidumping and countervailing duties, and Section 232 tariffs, are crucial for maintaining a level playing field. Legal Proceedings: Nucor Corporation is periodically involved in various lawsuits, claims, and legal proceedings in the ordinary course of business. Reserves are recorded for probable and estimable liabilities. The Company does not believe any current proceedings, individually or in aggregate, would have a material adverse effect on its financial condition or results of operations. Nucor Steel Louisiana is negotiating a settlement with the United States Department of Justice, United States Environmental Protection Agency, and the Louisiana Department of Environmental Quality regarding alleged Clean Air Act violations, which is not expected to be material.

Tax Strategy & Considerations

Tax Profile: Nucor Corporation's effective tax rate was 20.09% in 2024, compared to 21.68% in 2023. The Company had approximately $212 million in unrecognized tax benefits as of December 31, 2024, with $209 million potentially affecting its effective tax rate if recognized. Accrued interest and penalties related to uncertain tax positions totaled approximately $50 million at year-end 2024.

• Geographic Tax Planning: Nucor Corporation's international tax structure and transfer pricing are influenced by its operations in Canada, Trinidad & Tobago, and other foreign jurisdictions.
• Tax Reform Impact: As a U.S.-based company, Nucor Corporation is exposed to changes in U.S. tax laws, which could affect its future income tax provision and cash tax liability.
• Tax Audits: The Internal Revenue Service ("IRS") is currently examining Nucor Corporation's 2015, 2019, and 2020 federal income tax returns, with tax years 2021 through 2023 remaining open. The Canada Revenue Agency is examining Canadian income tax returns for Nucor Rebar Fabrication Group Inc. for 2015 through 2021.

Insurance & Risk Transfer

Risk Management Framework:

• Insurance Coverage: Nucor Corporation maintains property insurance to cover losses from unplanned events such as explosions, fires, natural disasters, and critical equipment failures, but self-insures a significant portion of its program.
• Risk Transfer Mechanisms: The Company periodically uses derivative financial instruments to partially manage its exposure to price risk related to purchases of natural gas, steel, scrap, copper, and aluminum. Forward foreign exchange contracts are also used to hedge cash flows associated with certain assets, liabilities, firm commitments, and anticipated transactions. As of December 31, 2024, there were no interest rate swaps outstanding.