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Table of Contents

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended April 2, 2022

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission File Number: 1-4119

 

NUCOR CORPORATION

(Exact name of registrant as specified in its charter)

 

 

Delaware

 

13-1860817

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

 

 

1915 Rexford Road, Charlotte, North Carolina

 

28211

(Address of principal executive offices)

 

(Zip Code)

(704) 366-7000

(Registrant’s telephone number, including area code)

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading Symbol(s)

 

Name of each exchange on which registered

Common Stock, par value $0.40 per share

 

NUE

 

New York Stock Exchange

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes      No  

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes        No  

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

 

Accelerated filer

Non-accelerated filer

 

Smaller reporting company

 

 

 

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes      No  

266,061,964 shares of the registrant’s common stock were outstanding at April 2, 2022.

 

 

 

 


Table of Contents

 

 

Nucor Corporation

Quarterly Report on Form 10-Q

For the Three Months Ended April 2, 2022

Table of Contents

 

 

 

 

 

 

 

Page

Part I

 

Financial Information

 

 

 

 

 

 

 

 

 

 

 

Item 1

 

Financial Statements (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

Condensed Consolidated Statements of Earnings – Three Months (13 Weeks) Ended April 2, 2022 and April 3, 2021

 

1

 

 

 

 

 

 

 

 

 

 

 

Condensed Consolidated Statements of Comprehensive Income – Three Months (13 Weeks) Ended April 2, 2022 and April 3, 2021

 

2

 

 

 

 

 

 

 

 

 

 

 

Condensed Consolidated Balance Sheets – April 2, 2022 and December 31, 2021

 

3

 

 

 

 

 

 

 

 

 

 

 

Condensed Consolidated Statements of Cash Flows – Three Months (13 Weeks) Ended April 2, 2022 and April 3, 2021

 

4

 

 

 

 

 

 

 

 

 

 

 

Notes to Condensed Consolidated Financial Statements

 

5

 

 

 

 

 

 

 

 

 

Item 2

 

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

16

 

 

 

 

 

 

 

 

 

Item 3

 

Quantitative and Qualitative Disclosures About Market Risk

 

22

 

 

 

 

 

 

 

 

 

Item 4

 

Controls and Procedures

 

23

 

 

 

 

 

 

 

Part II

 

Other Information

 

 

 

 

 

 

 

 

 

 

 

Item 1

 

Legal Proceedings

 

24

 

 

 

 

 

 

 

 

 

Item 1A

 

Risk Factors

 

24

 

 

 

 

 

 

 

 

 

Item 2

 

Unregistered Sales of Equity Securities and Use of Proceeds

 

24

 

 

 

 

 

 

 

 

 

Item 6

 

Exhibits

 

25

 

 

 

 

 

 

 

Signatures

 

26

 

 

 

 

 

 

 

 

 

i


Table of Contents

 

 

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

Nucor Corporation Condensed Consolidated Statements of Earnings (Unaudited)

(In thousands, except per share amounts)

 

 

 

Three Months (13 Weeks) Ended

 

 

 

April 2, 2022

 

 

April 3, 2021

 

Net sales

 

$

10,493,282

 

 

$

7,017,140

 

Costs, expenses and other:

 

 

 

 

 

 

 

 

Cost of products sold

 

 

7,035,143

 

 

 

5,394,703

 

Marketing, administrative and other expenses

 

 

524,584

 

 

 

291,124

 

Equity in earnings of unconsolidated affiliates

 

 

(7,695

)

 

 

(13,239

)

Losses on assets

 

 

-

 

 

 

6,662

 

Interest expense, net

 

 

43,135

 

 

 

39,644

 

 

 

 

7,595,167

 

 

 

5,718,894

 

Earnings before income taxes and noncontrolling interests

 

 

2,898,115

 

 

 

1,298,246

 

Provision for income taxes

 

 

671,000

 

 

 

310,732

 

Net earnings

 

 

2,227,115

 

 

 

987,514

 

Earnings attributable to noncontrolling interests

 

 

131,492

 

 

 

45,082

 

Net earnings attributable to Nucor stockholders

 

$

2,095,623

 

 

$

942,432

 

Net earnings per share:

 

 

 

 

 

 

 

 

Basic

 

$

7.69

 

 

$

3.10

 

Diluted

 

$

7.67

 

 

$

3.10

 

Average shares outstanding:

 

 

 

 

 

 

 

 

Basic

 

 

271,564

 

 

 

301,846

 

Diluted

 

 

272,094

 

 

 

302,518

 

 

See notes to condensed consolidated financial statements.

1


Table of Contents

 

 

Nucor Corporation Condensed Consolidated Statements of Comprehensive Income (Unaudited)

(In thousands)

 

 

 

Three Months (13 Weeks) Ended

 

 

 

April 2, 2022

 

 

April 3, 2021

 

Net earnings

 

$

2,227,115

 

 

$

987,514

 

Other comprehensive income:

 

 

 

 

 

 

 

 

Net unrealized income on hedging derivatives, net

   of income taxes of $16,800 and $400 for the first

   quarter of 2022 and 2021, respectively

 

 

53,476

 

 

 

999

 

Reclassification adjustment for settlement of hedging

   derivatives included in net earnings, net of income

   taxes of $(1,700) and $100 for the first quarter of 2022

   and 2021, respectively

 

 

(5,390

)

 

 

501

 

Foreign currency translation gain, net of income

   taxes of $0 for the first quarter of 2022 and 2021

 

 

22,692

 

 

 

13,801

 

 

 

 

70,778

 

 

 

15,301

 

Comprehensive income

 

 

2,297,893

 

 

 

1,002,815

 

Comprehensive income attributable to noncontrolling

   interests

 

 

131,492

 

 

 

45,082

 

Comprehensive income attributable to Nucor stockholders

 

$

2,166,401

 

 

$

957,733

 

 

See notes to condensed consolidated financial statements.

2


Table of Contents

 

 

Nucor Corporation Condensed Consolidated Balance Sheets (Unaudited)

(In thousands)

 

 

 

April 2, 2022

 

 

Dec 31, 2021

 

ASSETS

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

3,725,266

 

 

$

2,364,858

 

Short-term investments

 

 

446,868

 

 

 

253,005

 

Accounts receivable, net

 

 

4,111,478

 

 

 

3,853,972

 

Inventories, net

 

 

6,245,679

 

 

 

6,011,182

 

Other current assets

 

 

252,060

 

 

 

316,540

 

Total current assets

 

 

14,781,351

 

 

 

12,799,557

 

Property, plant and equipment, net

 

 

8,921,263

 

 

 

8,114,818

 

Restricted cash and cash equivalents

 

 

88,242

 

 

 

143,800

 

Goodwill

 

 

2,904,134

 

 

 

2,827,344

 

Other intangible assets, net

 

 

1,063,210

 

 

 

1,103,759

 

Other assets

 

 

874,668

 

 

 

833,794

 

Total assets

 

$

28,632,868

 

 

$

25,823,072

 

LIABILITIES

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Short-term debt

 

$

86,521

 

 

$

107,723

 

Current portion of long-term debt and finance lease obligations

 

 

629,536

 

 

 

615,678

 

Accounts payable

 

 

1,900,536

 

 

 

1,974,041

 

Salaries, wages and related accruals

 

 

832,999

 

 

 

1,495,166

 

Accrued expenses and other current liabilities

 

 

1,081,706

 

 

 

964,805

 

Federal income taxes payable

 

 

602,537

 

 

 

-

 

Total current liabilities

 

 

5,133,835

 

 

 

5,157,413

 

Long-term debt and finance lease obligations due after one year

 

 

6,112,331

 

 

 

4,961,410

 

Deferred credits and other liabilities

 

 

1,243,582

 

 

 

1,100,455

 

Total liabilities

 

 

12,489,748

 

 

 

11,219,278

 

Commitments and contingencies

 

 

 

 

 

 

 

 

EQUITY

 

 

 

 

 

 

 

 

Nucor stockholders' equity:

 

 

 

 

 

 

 

 

Common stock

 

 

152,061

 

 

 

152,061

 

Additional paid-in capital

 

 

2,163,129

 

 

 

2,140,608

 

Retained earnings

 

 

19,635,277

 

 

 

17,674,100

 

Accumulated other comprehensive loss,

   net of income taxes

 

 

(44,504

)

 

 

(115,282

)

Treasury stock

 

 

(6,701,401

)

 

 

(5,835,098

)

Total Nucor stockholders' equity

 

 

15,204,562

 

 

 

14,016,389

 

Noncontrolling interests

 

 

938,558

 

 

 

587,405

 

Total equity

 

 

16,143,120

 

 

 

14,603,794

 

Total liabilities and equity

 

$

28,632,868

 

 

$

25,823,072

 

 

See notes to condensed consolidated financial statements.

3


Table of Contents

 

 

Nucor Corporation Condensed Consolidated Statements of Cash Flows (Unaudited)

(In thousands)

 

 

 

Three Months (13 Weeks) Ended

 

 

 

April 2, 2022

 

 

April 3, 2021

 

Operating activities:

 

 

 

 

 

 

 

 

Net earnings

 

$

2,227,115

 

 

$

987,514

 

Adjustments:

 

 

 

 

 

 

 

 

Depreciation

 

 

195,478

 

 

 

179,820

 

Amortization

 

 

41,411

 

 

 

21,130

 

Stock-based compensation

 

 

26,422

 

 

 

19,859

 

Deferred income taxes

 

 

(18,764

)

 

 

62,705

 

Distributions from affiliates

 

 

1,500

 

 

 

180

 

Equity in earnings of unconsolidated affiliates

 

 

(7,695

)

 

 

(13,239

)

Losses on assets

 

 

-

 

 

 

6,662

 

Changes in assets and liabilities (exclusive of acquisitions and dispositions):

 

 

 

 

 

 

 

 

Accounts receivable

 

 

(92,394

)

 

 

(524,570

)

Inventories

 

 

124,201

 

 

 

(795,940

)

Accounts payable

 

 

(165,476

)

 

 

225,333

 

Federal income taxes

 

 

672,142

 

 

 

200,888

 

Salaries, wages and related accruals

 

 

(658,267

)

 

 

69,780

 

Other operating activities

 

 

126,495

 

 

 

90,289

 

Cash provided by operating activities

 

 

2,472,168

 

 

 

530,411

 

Investing activities:

 

 

 

 

 

 

 

 

Capital expenditures

 

 

(447,682

)

 

 

(313,510

)

Investment in and advances to affiliates

 

 

(63

)

 

 

(118

)

Disposition of plant and equipment

 

 

7,288

 

 

 

5,735

 

Acquisitions (net of cash acquired)

 

 

(347,177

)

 

 

300

 

Purchases of investments

 

 

(274,197

)

 

 

(214,427

)

Proceeds from the sale of investments

 

 

80,333

 

 

 

219,777

 

Other investing activities

 

 

(183

)

 

 

249

 

Cash used in investing activities

 

 

(981,681

)

 

 

(301,994

)

Financing activities:

 

 

 

 

 

 

 

 

Net change in short-term debt

 

 

(21,202

)

 

 

(1,607

)

Proceeds from issuance of long-term debt, net of discount

 

 

1,093,059

 

 

 

-

 

Repayment of long-term debt

 

 

(2,500

)

 

 

-

 

Bond issuance costs

 

 

(8,388

)

 

 

-

 

Proceeds from exercise of stock options

 

 

16,586

 

 

 

107,524

 

Payment of tax withholdings on certain stock-based compensation

 

 

(8,512

)

 

 

(14,521

)

Distributions to noncontrolling interests

 

 

(211,558

)

 

 

(73,795

)

Cash dividends

 

 

(137,587

)

 

 

(123,901

)

Acquisition of treasury stock

 

 

(905,324

)

 

 

(301,859

)

Other financing activities

 

 

(3,883

)

 

 

(2,505

)

Cash used in financing activities

 

 

(189,309

)

 

 

(410,664

)

Effect of exchange rate changes on cash

 

 

3,672

 

 

 

3,307

 

Increase (decrease) in cash and cash equivalents and

   restricted cash and cash equivalents

 

 

1,304,850

 

 

 

(178,940

)

Cash and cash equivalents and restricted cash and cash

   equivalents - beginning of year

 

 

2,508,658

 

 

 

2,754,929

 

Cash and cash equivalents and restricted cash and cash

   equivalents - end of three months

 

$

3,813,508

 

 

$

2,575,989

 

Non-cash investing activity:

 

 

 

 

 

 

 

 

Change in accrued plant and equipment purchases

 

$

(7,789

)

 

$

4,461

 

 

See notes to condensed consolidated financial statements.

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Nucor Corporation – Notes to Condensed Consolidated Financial Statements (Unaudited)

1. Basis of Interim Presentation

The information furnished in this Item 1 reflects all adjustments which are, in the opinion of management, necessary to a fair statement of the results for the interim periods presented and are of a normal and recurring nature unless otherwise noted. The information furnished has not been audited; however, the December 31, 2021 condensed consolidated balance sheet data was derived from audited financial statements but does not include all disclosures required by accounting principles generally accepted in the United States of America. The unaudited condensed consolidated financial statements included in this Item 1 should be read in conjunction with the audited consolidated financial statements and the notes thereto included in Nucor’s Annual Report on Form 10-K for the year ended December 31, 2021.

2. Inventories

Inventories consisted of approximately 43% raw materials and supplies and 57% finished and semi-finished products at both April 2, 2022 and December 31, 2021. Nucor’s manufacturing process consists of a continuous, vertically integrated process from which products are sold to customers at various stages throughout the process. Since most steel products can be classified as either finished or semi-finished products, these two categories of inventory are combined.

3. Property, Plant and Equipment

Property, plant and equipment is recorded net of accumulated depreciation of $10.57 billion at April 2, 2022 ($10.39 billion at December 31, 2021).   

 

4. Goodwill and Other Intangible Assets

The change in the net carrying amount of goodwill for the three months ended April 2, 2022 by segment was as follows (in thousands):

 

 

 

Steel Mills

 

 

Steel Products

 

 

Raw Materials

 

 

Total

 

Balance at December 31, 2021

 

$

613,175

 

 

$

1,439,874

 

 

$

774,295

 

 

$

2,827,344

 

Acquisitions

 

 

69,097

 

 

 

(62

)

 

 

-

 

 

 

69,035

 

Translation

 

 

-

 

 

 

7,755

 

 

 

-

 

 

 

7,755

 

Balance at April 2, 2022

 

$

682,272

 

 

$

1,447,567

 

 

$

774,295

 

 

$

2,904,134

 

 

Nucor completed its most recent annual goodwill impairment testing as of the first day of the fourth quarter of 2021 and concluded that as of such date there was no impairment of goodwill for any of its reporting units.

The annual assessment performed in 2021 for one of the Company’s reporting units, Rebar Fabrication, used forward-looking projections in future cash flows. The fair value of this reporting unit exceeded its carrying value by approximately 54% in the most recent assessment. If our assessment of the relevant facts and circumstances changes, including if the expected future performance of this reporting unit declines from the most recent assessment, non-cash impairment charges may be required. Total goodwill associated with the Rebar Fabrication reporting unit was $369.8 million as of April 2, 2022 ($363.0 million as of December 31, 2021). An impairment of goodwill may also lead us to record an impairment of other intangible assets. Total finite-lived intangible assets associated with the Rebar Fabrication reporting unit were $43.5 million as of April 2, 2022 ($45.0 million as of December 31, 2021). There have been no triggering events requiring an interim assessment for impairment of the Rebar Fabrication reporting unit since the most recent annual goodwill impairment testing date.

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Table of Contents

 

Intangible assets with estimated useful lives of five to 22 years are amortized on a straight-line or accelerated basis and were comprised of the following as of April 2, 2022 and December 31, 2021 (in thousands):

 

 

 

April 2, 2022

 

 

December 31, 2021

 

 

 

Gross Amount

 

 

Accumulated

Amortization

 

 

Gross Amount

 

 

Accumulated

Amortization

 

Customer relationships

 

$

1,872,636

 

 

$

952,967

 

 

$

1,872,348

 

 

$

924,506

 

Trademarks and trade names

 

 

217,829

 

 

 

104,161

 

 

 

217,255

 

 

 

99,906

 

Other

 

 

105,522

 

 

 

75,649

 

 

 

105,522

 

 

 

66,954

 

 

 

$

2,195,987

 

 

$

1,132,777

 

 

$

2,195,125

 

 

$

1,091,366

 

 

Intangible asset amortization expense in the first quarter of 2022 and 2021 was $41.4 million and $21.1 million, respectively. Annual amortization expense is estimated to be $154.6 million in 2022; $132.9 million in 2023; $132.1 million in 2024; $131.2 million in 2025; and $128.2 million in 2026.

5. Current Liabilities

Book overdrafts, included in accounts payable in the condensed consolidated balance sheets, were $128.1 million at April 2, 2022 ($143.8 million at December 31, 2021). Dividends payable, included in accrued expenses and other current liabilities in the condensed consolidated balance sheets, were $134.5 million at April 2, 2022 ($137.6 million at December 31, 2021).

6. Fair Value Measurements

The following table summarizes information regarding Nucor’s financial assets and financial liabilities that were measured at fair value as of April 2, 2022 and December 31, 2021 (in thousands). Nucor does not have any non-financial assets or non-financial liabilities that are measured at fair value on a recurring basis.

 

 

 

 

 

 

 

Fair Value Measurements at Reporting Date Using

 

Description

 

Carrying

Amount in

Condensed

Consolidated

Balance

Sheets

 

 

Quoted Prices

in Active

Markets for

Identical

Assets

(Level 1)

 

 

Significant

Other

Observable

Inputs

(Level 2)

 

 

Significant

Unobservable

Inputs

(Level 3)

 

As of April 2, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash equivalents

 

$

3,129,506

 

 

$

3,129,506

 

 

$

-

 

 

$

-

 

Short-term investments

 

 

446,868

 

 

 

446,868

 

 

 

-

 

 

 

-

 

Restricted cash and cash equivalents

 

 

88,242

 

 

 

88,242

 

 

 

-

 

 

 

-

 

Derivative contracts

 

 

69,020

 

 

-

 

 

 

69,020

 

 

 

-

 

Total assets

 

$

3,733,636

 

 

$

3,664,616

 

 

$

69,020

 

 

$

-

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Derivative contracts

 

$

(5,457

)

 

$

-

 

 

$

(5,457

)

 

$

-

 

As of December 31, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash equivalents

 

$

1,776,477

 

 

$

1,776,477

 

 

$

-

 

 

$

-

 

Short-term investments

 

 

253,005

 

 

 

253,005

 

 

 

-

 

 

 

-

 

Restricted cash and cash equivalents

 

 

143,800

 

 

 

143,800

 

 

 

-

 

 

 

-

 

Derivative contracts

 

 

6,633

 

 

 

-

 

 

 

6,633

 

 

 

-

 

Total assets

 

$

2,179,915

 

 

$

2,173,282

 

 

$

6,633

 

 

$

-

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Derivative contracts

 

$

(2,666

)

 

$

-

 

 

$

(2,666

)

 

$

-

 

 

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Table of Contents

 

 

Fair value measurements for Nucor’s cash equivalents, short-term investments and restricted cash and cash equivalents are classified under Level 1 because such measurements are based on quoted market prices in active markets for identical assets. Our short-term investments at April 2, 2022 consisted of certificates of deposit, commercial paper and corporate notes. Fair value measurements for Nucor’s derivatives, which are typically commodity or foreign exchange contracts, are classified under Level 2 because such measurements are based on published market prices for similar assets or are estimated based on observable inputs such as interest rates, yield curves, credit risks, spot and future commodity prices, and spot and future exchange rates. There were no transfers between the levels in the fair value hierarchy for the periods presented.

The fair value of short-term and long-term debt, including current maturities, was approximately $6.77 billion at April 2, 2022 (approximately $6.06 billion at December 31, 2021). The debt fair value estimates are classified under Level 2 because such estimates are based on readily available market prices of our debt at April 2, 2022 and December 31, 2021, or similar debt with the same maturities, ratings and interest rates.

7. Contingencies

We are from time to time a party to various lawsuits, claims and other legal proceedings that arise in the ordinary course of business. With respect to all such lawsuits, claims and proceedings, we record reserves when it is probable a liability has been incurred and the amount of loss can be reasonably estimated. We do not believe that any of these proceedings, individually or in the aggregate, would be expected to have a material adverse effect on our results of operations, financial position or cash flows. Nucor maintains liability insurance for certain risks with self-insurance limits.

8. Stock-Based Compensation

Stock Options 

A summary of activity under Nucor’s stock option plans for the first quarter of 2022 is as follows (shares in thousands):

 

 

 

 

 

 

 

Weighted-

 

 

Weighted-

 

 

 

 

 

 

 

 

 

 

Average

 

 

Average

 

Aggregate

 

 

 

 

 

 

 

Exercise

 

 

Remaining

 

Intrinsic

 

 

 

Shares

 

 

Price

 

 

Contractual Life

 

Value

 

Number of shares under stock options:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Outstanding at beginning of year

 

 

1,186

 

 

$

55.58

 

 

 

 

 

 

 

Granted

 

 

-

 

 

$

-

 

 

 

 

 

 

 

Exercised

 

 

(310

)

 

$

53.51

 

 

 

 

$

20,040

 

Canceled

 

 

-

 

 

$

-

 

 

 

 

 

 

 

Outstanding at April 2, 2022

 

 

876

 

 

$

56.31

 

 

7.5 years

 

$

81,417

 

Stock options exercisable at April 2, 2022

 

 

213

 

 

$

56.46

 

 

5.7 years

 

$

19,761

 

 

Compensation expense for stock options was $0.5 million and $0.3 million in the first quarter of 2022 and 2021, respectively. As of April 2, 2022, unrecognized compensation expense related to stock options was $2.6 million, which is expected to be recognized over a weighted-average period of 1.8 years.

Restricted Stock Units

A summary of Nucor’s restricted stock unit (“RSU”) activity for the first quarter of 2022 is as follows (shares in thousands):

 

 

 

Shares

 

 

Grant Date

Fair Value

 

Restricted stock units:

 

 

 

 

 

 

 

 

Unvested at beginning of year

 

 

1,167

 

 

$

60.45

 

Granted

 

 

-

 

 

$

-

 

Vested

 

 

(14

)

 

$

60.40

 

Canceled

 

 

(3

)

 

$

66.00

 

Unvested at April 2, 2022

 

 

1,150

 

 

$

60.44

 

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Table of Contents

 

 

 

Compensation expense for RSUs was $9.0 million and $9.3 million in the first quarter of 2022 and 2021, respectively. As of April 2, 2022, unrecognized compensation expense related to unvested RSUs was $34.6 million, which is expected to be recognized over a weighted-average period of 0.9 years.

Restricted Stock Awards  

A summary of Nucor’s restricted stock activity under the Nucor Corporation Senior Officers Annual Incentive Plan (a supplement to the Nucor Corporation 2014 Omnibus Incentive Compensation Plan, the “AIP”) and the Nucor Corporation Senior Officers Long-Term Incentive Plan (a supplement to the Nucor Corporation 2014 Omnibus Incentive Compensation Plan, the “LTIP”) for the first quarter of 2022 is as follows (shares in thousands):

 

 

 

 

 

 

Grant Date

 

 

 

Shares

 

 

Fair Value

 

Restricted stock units and restricted stock awards:

 

 

 

 

 

 

 

 

Unvested at beginning of year

 

 

107

 

 

$

57.17

 

Granted

 

 

465

 

 

$

128.62

 

Vested

 

 

(341

)

 

$

119.52

 

Canceled

 

 

-

 

 

$

-

 

Unvested at April 2, 2022

 

 

231

 

 

$

109.02

 

 

Compensation expense for common stock and common stock units awarded under the AIP and the LTIP is recorded over the performance measurement and vesting periods based on the anticipated number and market value of shares of common stock and common stock units to be awarded. Compensation expense for anticipated awards based upon Nucor’s financial performance, exclusive of amounts payable in cash, was $17.0 million and $10.2 million in the first quarter of 2022 and 2021, respectively. As of April 2, 2022, unrecognized compensation expense related to unvested restricted stock awards was $8.7 million, which is expected to be recognized over a weighted-average period of 2.4 years.

9. Employee Benefit Plan

Nucor makes contributions to a Profit Sharing and Retirement Savings Plan for qualified employees based on the profitability of the Company. Nucor’s expense for these benefits totaled $286.9 million and $129.0 million in the first quarter of 2022 and 2021, respectively. The related liability for these benefits is included in salaries, wages and related accruals in the condensed consolidated balance sheets.

10. Interest Expense (Income)

The components of net interest expense for the first quarter of 2022 and 2021 are as follows (in thousands):

 

 

 

Three Months (13 Weeks) Ended

 

 

 

April 2, 2022

 

 

April 3, 2021

 

Interest expense

 

$

44,076

 

 

$

40,970

 

Interest income

 

 

(941

)

 

 

(1,326

)

Interest expense, net

 

$

43,135

 

 

$

39,644

 

 

11. Income Taxes

The effective tax rate for the first quarter of 2022 was 23.2% compared to 23.9% for the first quar