CONTACT    |   _eng _sk

Press release
           

7/27/2017

United States Steel Corporation Reports Second Quarter 2017 Results




Author: c

On July 25, 2017 United States Steel Corporation (NYSE: X) reported second quarter 2017 net earnings of $261 million, This compared to a second quarter 2016 net loss of $46 million,  and a first quarter 2017 net loss of $180 million.

Commenting on results, U. S. Steel President and Chief Executive Officer Dave Burritt said, "Our facilities performed better in the second quarter, particularly in our Flat-Rolled segment. Better operations, combined with higher prices and volumes in all of our segments and improved results from our mining operations, resulted in a $300 million improvement in our segment results compared with the first quarter. Our European operations continue to deliver solid earnings and our Tubular operations continue to make progress towards returning to profitability. We are focused on our strategic priorities: driving operational excellence across our business – from our plants to our support teams; investing in our facilities through our asset revitalization program; and providing our employees with the resources they need to implement positive, substantive changes. Successful execution of this strategy will result in continuous improvements in safety, quality, delivery and costs and create meaningful value and returns for all of our stakeholders, including employees, customers and stockholders."

Segment earnings before interest and income taxes were $253 million, or $66 per ton, for the second quarter of 2017 compared with segment loss before interest and income taxes of $47 million, or $13 per ton, in the first quarter of 2017 and a segment loss before interest and income taxes of $7 million, or $2 per ton, in the second quarter of 2016. For the second quarter of 2017, we recorded a tax benefit of $16 million on our pretax earnings of $245 million.

We had positive operating cash flow of $242 million for the six months ended June 30, 2017. As of June 30, 2017, we had $1.5 billion of cash and $3.3 billion of total liquidity, our highest liquidity since the separation from Marathon Oil at the end of 2001.

Second quarter results for our European segment declined compared with the first quarter due to an unfavorable first-in-first-out (FIFO) inventory impact, only partially offset by increased average realized prices and shipments, lower raw material and energy costs, and a favorable impact from foreign exchange rates.

Commenting on U. S. Steel's Outlook for 2017, Burritt said, "We are seeing a more bullish sentiment in the markets served by our Flat-Rolled and European segments right now, as prices have been increasing and overall demand has been stable. Our Tubular segment continues to benefit from operational and cost improvements we have made, as well as from stronger market conditions. Our investment in our facilities and our people continues to increase. These strategic investments, combined with our focus on achieving operational excellence, will deliver continuous improvements in safety, quality, delivery and costs that will position us to succeed through business cycles, and support future growth initiatives."

If market conditions remain at their current levels, we expect:

  • 2017 net earnings of approximately $300 million, and consolidated adjusted EBITDA of approximately $1.1 billion;
    • EBITDA by Segment;
      • Flat-Rolled EBITDA of approximately $750 million;
      • U. S. Steel Europe EBITDA of approximately $400 million;
      • Tubular EBITDA of approximately ($50) million; and
  • Other Businesses to be comparable to 2016 and approximately $60 million of postretirement benefit expense

We believe market conditions, which include spot prices, raw material costs, customer demand, import volumes, supply chain inventories, rig counts and energy prices, will change, and as changes occur during the balance of 2017, we expect these changes to be reflected in our net earnings and adjusted EBITDA.

Empty