Steel Dynamics (STLD) Economic Moat Analysis44

Evidence

In 2025, our own steel consuming businesses purchased 1.8 million tons of steel from our steel mills, representing 13% of our total 2025 steel shipments.

Business: actual internal steel purchases during 2025 · Filed 27/02/2026

Our metals recycling platform is the largest supplier of recycled ferrous scrap to our steel operations and the largest supplier of recycled aluminum scrap to our aluminum operations.

Business: recycling platform's internal supplier position · Filed 27/02/2026

This circular model allows us to reduce companywide working capital, as lower scrap inventory volume is required at our steel mills and aluminum operations.

Business: asserted working-capital benefit of circular operations · Filed 27/02/2026

We are also able to source higher-quality scrap for our steel mills and aluminum operations, increasing availability, optimizing costs, and improving quality.

Business: asserted scrap quality, availability and cost benefits · Filed 27/02/2026

During weaker steel demand environments, we can source their steel needs internally, and during stronger steel demand environments, we may also purchase steel externally.

Business: flexible internal and external downstream steel sourcing · Filed 27/02/2026

Moreover, some of our integrated steel producer competitors are not as dependent as we are on ferrous scrap as a part of their raw material melt mix, which, during periods of high scrap costs relative to the cost of blast furnace iron used by the integrated producers, give them a raw material cost advantage over EAF mills.

Raw materials: circumstances favoring integrated steel competitors · Filed 27/02/2026

However, given environmental considerations of investors, customers and regulators, additional EAF mills may be constructed, or companies currently operating blast furnace mills may invest in EAF mills, leading to increased demand in ferrous scrap possibly resulting in higher ferrous scrap prices.

Raw materials: potential EAF expansion and scrap-cost pressure · Filed 27/02/2026

While our vertical integration with our metals recycling business and liquid pig-iron operations are expected to enable us to continue being a cost-effective supplier to our own steelmaking and aluminum operations, for some of our metallics requirements, we still rely on other metallics and raw material suppliers, as well as upon general industry supply conditions for the balance of our needs.

Raw materials: continuing external supplier dependence · Filed 27/02/2026

Steel segment average selling prices decreased 1%, or $14 per ton, compared to 2024.

2025 steel results: realized average selling-price decline · Filed 27/02/2026

Due to metal spread compression, operating income for the steel operations decreased 10% to $1.4 billion in 2025 compared to 2024.

2025 steel results: spread compression and operating-income decline · Filed 27/02/2026

2024 Net sales for the steel fabrication operations decreased 20% during 2025 compared to 2024, as average selling prices decreased 13% and volumes decreased 8% compared to 2024.

2025 fabrication results: selling-price and volume declines · Filed 27/02/2026

Second quarter 2026 total steel segment average selling prices increased 14%, or $162 per ton, compared to the second quarter of 2025, while segment shipments increased 7%.

Second-quarter 2026 steel results: realized price and shipment increases · Filed 28/07/2026

In the second quarter of 2026, as a result of average selling prices rising more than scrap costs, metal spread (which we define as the difference between average steel mill selling prices and the cost of ferrous scrap consumed in our steel mills) increased 22% compared to the second quarter of 2025.

Second-quarter 2026 steel results: metal-spread expansion · Filed 28/07/2026

2025 Net sales for our steel fabrication operations increased 16% during the second quarter of 2026 compared to the same period in 2025, as volumes increased 19%, while average selling prices decreased $75 per ton, or 3%, from the second quarter of 2025.

Second-quarter 2026 fabrication results: rising volumes and falling prices · Filed 28/07/2026

Metal spread (which we define as the difference between average selling prices and the cost of purchased steel) contracted 11% in the second quarter of 2026 compared to the same period in 2025 due to rising steel input costs.

Second-quarter 2026 fabrication results: realized spread contraction · Filed 28/07/2026

For the first half of 2026, operating income decreased 17% to $174.1 million compared to the first half of 2025, as a result of a 13% decrease in metal spread, primarily attributable to rising steel input costs.

First-half 2026 fabrication results: declining operating income and spread · Filed 28/07/2026

Customer order activity has continued to strengthen since the end of 2025, with the order backlog now nearly 45 percent higher than a year ago and extending into the first quarter 2027.

Fabrication demand: backlog growth and delivery horizon · Filed 28/07/2026

We charge premium prices for certain grades of steel and aluminum, product dimensions, certain smaller volumes, and for value-added processing or coating of our steel products.

Operating classifications: disclosed product and processing premiums · Filed 28/07/2026

Our risk strategy associated with product sales has generally been to obtain competitive prices for our products and to allow operating results to reflect market price movements dictated by supply and demand.

Commodity risk: market-driven product pricing strategy · Filed 28/07/2026

In our metals recycling, aluminum, and steel operations, we have certain fixed price contracts with various customers and suppliers for future delivery of nonferrous and ferrous metals.

Commodity risk: fixed-price customer and supplier contracts · Filed 28/07/2026

We generated $1.4 billion in operating cash flow during 2025 and ended the year with strong liquidity of more than $2.2 billion.

2025 results: operating cash flow and year-end liquidity · Filed 27/03/2026

We made significant investments in our operations and our aluminum growth platform, with capital expenditures of $948 million.

2025 investment: actual capital expenditures · Filed 27/03/2026

We maintained our positive dividend profile, increasing cash dividends by 9% per share in February 2025, and returned $1.2 billion to our shareholders through a combination of dividends and share repurchases.

2025 capital returns: dividends and repurchases · Filed 27/03/2026

At December 31, 2025, the company’s interest coverage ratio and debt to capitalization ratio were 13.33:1.00 and 0.32:1.00, respectively.

Debt note: actual year-end 2025 coverage and capitalization ratios · Filed 27/02/2026

CONSOLIDATED BALANCE SHEETS (in thousands, except share data) ​ ​ ​ ​ ​ ​ ​ ​ June 30, ​ ​ December 31, ​ 2026 ​ ​ 2025 Assets (unaudited) ​ ​ ​ ​ Current assets ​ ​ ​ ​ ​ ​ Cash and equivalents $ 567,708 ​ ​ $ 769,878 Accounts receivable, net ​ 2,435,045 ​ ​ ​ 1,680,249 Accounts receivable-related parties ​ 7,893 ​ ​ ​ 2,411 Inventories ​ 3,955,621 ​ ​ ​ 3,738,516 Other current assets ​ 314,768 ​ ​ ​ 293,117 Total current assets ​ 7,281,035 ​ ​ ​ 6,484,171 ​ ​ ​ ​ ​ ​ ​ Property, plant and equipment, net ​ 8,491,771 ​ ​ ​ 8,569,466 Intangible assets, net ​ 315,759 ​ ​ ​ 331,290 Goodwill ​ 477,471 ​ ​ ​ 477,471 Other assets ​ 547,363 ​ ​ ​ 557,382 Total assets $ 17,113,399 ​ ​ $ 16,419,780 Liabilities and Equity ​ ​ ​ ​ ​ ​ Current liabilities ​ ​ ​ ​ ​ ​ Accounts payable $ 1,465,868 ​ ​ $ 1,223,776 Accounts payable-related parties ​ 17,698 ​ ​ ​ 7,582 Income taxes payable ​ 32,345 ​ ​ ​ 67,315 Accrued payroll and benefits ​ 313,113 ​ ​ ​ 361,494 Accrued expenses ​ 456,950 ​ ​ ​ 427,432 Current maturities of long-term debt ​ 1,332 ​ ​ ​ 34,655 Total current liabilities ​ 2,287,306 ​ ​ ​ 2,122,254 ​ ​ ​ ​ ​ ​ ​ Long-term debt ​ 4,180,810 ​ ​ ​ 4,176,508 Deferred income taxes ​ 1,070,817 ​ ​ ​ 1,004,375 Other liabilities ​ 211,395 ​ ​ ​ 186,232 Total liabilities ​ 7,750,328 ​ ​ ​ 7,489,369 ​ ​ ​ ​ ​ ​ ​ Commitments and contingencies ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Redeemable noncontrolling interests ​ 143,259 ​ ​ ​ 141,226 ​ ​ ​ ​ ​ ​ ​ Equity ​ ​ ​ ​ ​ ​ Common stock voting, $0.0025 par value; 900,000,000 shares authorized; ​ ​ ​ ​ ​ ​ 268,694,947 and 268,644,427 shares issued; and 143,610,058 and 144,940,102 ​ ​ ​ ​ ​ ​ shares outstanding, as of June 30, 2026 and December 31, 2025, respectively ​ 653 ​ ​ ​ 653 Treasury stock, at cost; 125,084,889 and 123,704,325 shares, ​ ​ ​ ​ ​ ​ as of June 30, 2026 and December 31, 2025, respectively ​ (8,287,758) ​ ​ ​ (7,980,549) Additional paid-in capital ​ 1,229,734 ​ ​ ​ 1,248,634 Retained earnings ​ 16,473,691 ​ ​ ​ 15,689,042 Accumulated other comprehensive income (loss) ​ 3,212 ​ ​ ​ (598) Total Steel Dynamics, Inc.

June 30, 2026 unaudited balance sheet: cash, debt and outstanding shares · Filed 28/07/2026

/ (Quarterly Average Current Maturities of Long-term Debt + Long-term Debt + Total Equity) ​ ​ 8 Health and Safety | Entrepreneurial Culture | Customer Commitment | Strategic Sustainable Growth | Innovation | Financial Strength ​ Table of Contents Performance Highlights There have been many highlights during our history, some of our more recent achievements include: – Maintaining our world-class safety culture, including a near record low total annual recordable injury rate in 2025, while each of our platforms continued to perform in line or meaningfully better than industry safety benchmarks – Record annual steel shipments of 13.7 million tons in 2025 – Successful production and qualifications of industrial, beverage can, and automotive quality flat rolled aluminum products at our flat rolled aluminum products mill, further becoming a differentiated, diversified metals growth company – Increasing our steel operations capabilities with our Sinton Flat Roll Division, which achieved consistent operational execution in 2025, and our four additional value-added flat roll coating lines, which further increases our higher-margin product offerings – Successful production and consumption of biocarbon material in the third quarter of 2025 – Achieving and improving our investment grade credit profile, which creates avenues to access lower cost and longer tenor capital – Inclusion within the S&P 500® Index, which is widely recognized as one of the premier benchmarks of the U.S.

Performance highlights: shipments, aluminum qualifications and Sinton execution · Filed 27/03/2026

Our product offerings will be supported by various value-added finishing lines that are still under construction, including two CASH (Continuous Annealing Solutions Heat Treating) lines, a can end and tab coating line, and downstream processing and packaging lines.

Aluminum operations: finishing lines still under construction at year-end 2025 · Filed 27/02/2026

Under this policy, they are required to own and hold shares (unvested shares are not included in the calculation) of the Company’s common stock with a fair market value as follows: Executive Officer ​ ​ ​ Requirement Chief Executive Officer ​ No less than five times base salary President ​ No less than four times base salary Executive Vice President and Chief Financial Officer ​ No less than three times base salary Senior Vice Presidents ​ No less than three times base salary Vice Presidents ​ No less than three times base salary ​ The Compensation Committee reviews compliance with the policy annually and requires that the specific ownership levels be met within five years of becoming an executive officer.

Executive ownership policy: required holdings excluding unvested shares · Filed 27/03/2026

As of December 31, 2025, each of our NEOs had met his or her specific ownership level requirement with an average hold of 98 times.

Executive ownership policy: actual NEO compliance at December 31, 2025 · Filed 27/03/2026

​ ​ ​ 50 Health and Safety | Entrepreneurial Culture | Customer Commitment | Strategic Sustainable Growth | Innovation | Financial Strength ​ Table of Contents 2025 Executive Compensation Program in Detail The following describes each component of our executive compensation program and how compensation amounts were determined for our NEOs for 2025.

Compensation discussion: description of actual 2025 compensation program · Filed 27/03/2026

More than 85% of our senior leadership team’s total potential compensation is “at risk” and linked to companywide financial metrics that encourage long-term value creation, including return on equity, growth, cash generation, and return on invested capital.

Compensation: senior leadership performance-linked potential pay · Filed 27/02/2026

1 Eight year average for our six independent director nominees, eleven year average for our seven director nominees, including one of our founders Board Practices ✓ Independent directors meet at least quarterly in executive session ✓ Ongoing succession planning and talent development for senior leadership and the Board ✓ Detailed risk oversight processes by the Board and each of the committees ✓ Annual evaluations, including individual director assessments ✓ All Board members attended at least 75% of Board and Committee meetings ✓ Code of Business Conduct and Ethics ✓ Robust Stock Ownership Guidelines for Executive Officers and Directors Board Composition ✓ Lead Independent Director ✓ Board Refreshment — Director Retirement Policy ✓ Robust director selection process which includes in each search, candidates who reflect diverse backgrounds ✓ Variety of experiences and perspectives, combined with seasoned industry knowledge ✓ Board committees consist of 100% independent directors Shareholder Rights ✓ Proxy access with standard provisions ✓ All directors stand for election annually ✓ Shareholder right to call a special meeting ✓ Majority voting with advance resignation in uncontested director elections ​ ​ ​ 10 Health and Safety | Entrepreneurial Culture | Customer Commitment | Strategic Sustainable Growth | Innovation | Financial Strength ​ Table of Contents ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Board of Directors Matrix Mark D.

Governance: board practices, independent committees and shareholder rights · Filed 27/03/2026

Millett served as our Chief Executive Officer and non-independent Board Chair.

Governance: combined CEO and non-independent board chair during 2025 · Filed 27/03/2026

(the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on the COSO criteria.

Independent auditor opinion: effective internal control at December 31, 2025 · Filed 27/02/2026

As indicated in the accompanying Management's Report on Internal Control Over Financial Reporting, management's assessment of and conclusion on the effectiveness of internal control over financial reporting did not include the internal controls of New Process Steel, L.P., which is included in the 2025 consolidated financial statements of the Company and constituted 3% and 5% of total and net assets, respectively, as of December 31, 2025, and 0.4% of net sales, for the year then ended.

Internal-control audit scope: New Process Steel exclusion · Filed 27/02/2026

We continue to see an improved steel market environment, supported by domestic trade actions, manufacturing reshoring, infrastructure program funding, and the increasing regionalization of supply chains within the United States.

2026 market environment: trade actions and demand support · Filed 28/07/2026

We have developed our real estate to 18 Table of Contents allow customers to co-locate on-site, with one customer already in the construction process and others expected to co-locate at the rolling mill site in Columbus, enhancing cost efficiencies and reducing emissions across the supply chain.

Aluminum site: one customer constructing co-located operations · Filed 27/02/2026

Publication history

Sources

• filing-1 · Filed 27/02/2026
• filing-2 · Filed 28/07/2026
• filing-3 · Filed 27/03/2026