Nucor CEO Leon Topalian told CNBC's Jim Cramer Tuesday that the steel producer will continue paying dividends, despite falling steel prices and the cloudy predicament facing the U.S. economy.
Topalian, who began leading the company as chief executive in January, said in a "Mad Money" interview that low-cost producers can find success and that Nucor will commit to its tradition of sharing its earnings with stockholders.
"We've been providing a dividend since I was five years old and I'm not going to be the first CEO in Nucor's history to stop that," the 52-year-old said. "That will continue."
Nucor, one of the largest steelmakers in America, has paid out and increased its base dividend for nearly five decades, executives said on an earnings call Tuesday. The Charlotte-based manufacturer has been a public entity since 1972.
Other corporations have slashed or paused dividends as executives try to grapple with the economic fallout of the coronavirus pandemic. Cleveland-Cliffs Inc., another steel producer, announced earlier this month that it suspend its dividend and that its chief executive would take a 40% pay cut.
Demand for steel has fallen in recent months and the going price for the construction material has declined along with it. In its earnings report for the first quarter, Nucor printed a top- and bottom-line beat. Revenue, however, was down 7.7% when compared to the same three-month period in 2019.
The near-term is expected to be tough for Nucor. The company is forecasting a loss in the current quarter, though FactSet estimates project earnings of 23 cents per share.
The company has paused some of its capital spending and delayed some planned projects. Capital spending was cut to $1.5 billion for the current year, down from an original projection of about $2 billion.
The construction segment remains "very resilient," Topalian told Cramer.
"We are optimistic that we'll see the bottom [in steel prices] in Q2 and move out of that as we enter the third and fourth quarters," Topalian said.
Nucor expects to return to profitability in the second half of 2020. Shares of the steelmaker slipped 0.02% in Tuesday's session. The stock is down 28% this year.
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