Market Snapshot
  • U.S.
  • Europe
  • Asia
Ticker Volume Price Price Delta
DJIA 16,408.54 -16.31 -0.10%
S&P 500 1,864.85 2.54 0.14%
NASDAQ 4,095.52 9.29 0.23%
Ticker Volume Price Price Delta
STOXX 50 3,155.81 16.55 0.53%
FTSE 100 6,625.25 41.08 0.62%
DAX 9,409.71 91.89 0.99%
Ticker Volume Price Price Delta
NIKKEI 14,516.27 98.74 0.68%
TOPIX 1,173.37 6.78 0.58%
HANG SENG 22,760.24 64.23 0.28%

United States Steel Corporation Reports 2012 Third Quarter Results



      United States Steel Corporation Reports 2012 Third Quarter Results

- Reportable segment and Other Businesses income from operations of $171
million

- Net income of $44 million, or $0.28 per diluted share, including a $0.13 per
diluted share charge for employee lump sum payments provided in the new labor
agreement

- Third quarter shipments of 5.3 million tons and net sales of $4.7 billion

- Strong liquidity position with $536 million of cash and $2.4 billion of
total liquidity

PR Newswire

PITTSBURGH, Oct. 30, 2012

PITTSBURGH, Oct. 30, 2012 /PRNewswire-FirstCall/ -- United States Steel
Corporation (NYSE: X) reported third quarter 2012 net income of $44 million,
or $0.28 per diluted share, compared to second quarter 2012 net income of
$101 million, or $0.62 per diluted share, and third quarter 2011 net income of
$22 million, or $0.15 per diluted share.  Net income for the third quarter
2012 included a $22 million, or $0.13 per diluted share, after-tax charge for
employee lump sum payments as provided in the new labor agreement.  Net income
for the second quarter 2012 included an $11 million after-tax early redemption
premium on our $300 million 5.65% Senior Notes due 2013.  Net income for the
third quarter 2011 included $96 million of net foreign currency losses,
primarily related to the accounting remeasurement of a U.S. dollar denominated
intercompany loan to a European entity.

Earnings Highlights
(Dollars in millions, except per share       3Q 2012    2Q 2012   3Q 2011
amounts)
Net Sales                                    $   4,652  $   5,017 $     5,081
Segment income (loss) from operations
            Flat-rolled                      $       29 $     177 $       203
            U. S. Steel Europe               27         34        (50)
            Tubular                          102        103       134
            Other Businesses                 13         16        8
Total reportable segment and Other           $     171  $     330 $       295
Businesses income from operations
Postretirement benefit expense               (74)       (77)      (96)
Other items not allocated to segments        (35)       -         -
Income from operations                       $       62 $     253 $       199
Net interest and other financial costs       45         82        144
Income tax (benefit) provision               (27)       70        33
Net income attributable to United States     $       44 $     101 $         22
Steel Corporation
-Per basic share                             $    0.30  $    0.70 $      0.15
-Per diluted share                           $    0.28  $    0.62 $      0.15

          

Commenting on results, U. S. Steel Chairman and CEO John P. Surma said, "Third
quarter operating results were positive for all three reportable segments in
an economic environment that was more challenging than the second quarter. 
Our Tubular segment once again had solid results despite declining rig
activity and pricing pressure caused by rising oil country tubular goods
inventory and continued high levels of imports.  Our Flat-rolled and European
segments were profitable but continue to be challenged by difficult global
economic conditions.  In addition, our Flat-rolled segment continued to be
adversely affected by increased import levels."

The company reported third quarter 2012 reportable segment and Other
Businesses income from operations of $171 million, or $32 per ton, compared
with income of $330 million, or $61 per ton, in the second quarter of 2012 and
income of $295 million, or $54 per ton, in the third quarter of 2011. 

Other items not allocated to segments in the third quarter of 2012 consisted
of a $35 million pre-tax charge for employee lump sum payments as provided in
the new labor agreement.

For the third quarter 2012, we recorded a tax benefit of $27 million on our
pre-tax income of $17 million.  The third quarter 2012 tax benefit includes
$20 million, or $0.12 per diluted share, of favorable effects associated with
the settlement of prior years' income tax audits and $26 million, or $0.15 per
diluted share, of a tax benefit to adjust our estimated 2011 federal income
tax liability to our actual tax liability reflected in our tax return as filed
in the third quarter.  The tax benefit does not reflect any tax benefit for
pre-tax losses in Canada, which is a jurisdiction where we have recorded a
full valuation allowance on deferred tax assets.    

As of September 30, 2012, U. S. Steel had $536 million of cash and $2.4
billion of total liquidity.  

Reportable Segments and Other Businesses                            

Flat-rolled third quarter results decreased from the second quarter primarily
due to a $31 per ton decrease in average realized prices, as significant price
decreases for domestic scrap and globally traded steelmaking raw materials
placed downward pressure on spot and index-based pricing mechanisms in North
America in the third quarter.  The spot market continues to be pressured by
high import volumes, which for sheet products have increased 13 percent year
over year through the first nine months of 2012.  Proceeds from steel
substrate sales to our Tubular segment have also decreased.  Shipments and
operating costs for our Flat-rolled segment were comparable to the second
quarter. 

Despite the continued economic challenges, third quarter results remained
positive for our European segment. Results were lower than the second quarter
as average realized prices decreased compared to the second quarter due to
weaker spot market prices. Shipments were also lower in the third quarter as a
result of the continued conservative buying pattern by service centers and
distributors, reduced automotive production schedules and the normal summer
holiday outages.  Operating costs decreased compared to the second quarter due
to lower raw materials prices and good operating cost performance.

Third quarter results for our Tubular segment were in line with the second
quarter. Shipments decreased as end users adjusted their drilling plans and
curtailed spending due to economic uncertainty and concern over energy prices.
Average realized prices declined slightly as import levels remained high
resulting in pricing pressure from increased supply.  Operating costs
decreased compared to the second quarter due to lower substrate costs.

Outlook

Commenting on U. S. Steel's outlook for the fourth quarter, Surma said, "Our
results are expected to reflect continued weakness in the European and
emerging market economies, as well as economic uncertainty in North America. 
We expect total reportable segment and Other Businesses operating results to
be around breakeven for the fourth quarter with decreased results in all
reportable segments."

We expect a loss for our Flat-rolled segment due to slightly lower average
realized prices, as well as lower shipments and higher operating costs. 
Average realized prices and shipments are expected to be lower compared to the
third quarter as a result of cautious purchasing patterns early in the quarter
created by the uncertain global economic outlook; however, market conditions
have recently begun improving in North America, and we believe that we are
already beyond the spot price trough of the fourth quarter.  New spot orders
are being transacted at higher prices for delivery later this quarter. 
Operating costs are expected to increase due to scheduled blast furnace and
other maintenance projects.

We expect our European segment results to be around breakeven.  Average
realized prices are expected to decrease reflecting lower spot market and
quarterly contract pricing.  Shipments are projected to decrease compared to
the third quarter due to lower consumption in automotive and other end user
industries.  Operating costs are expected to decrease compared to the third
quarter primarily due to lower raw materials costs.

We expect fourth quarter results for our Tubular segment to remain profitable
but well below third quarter results.  Average realized prices are expected to
be lower and shipments are projected to be significantly lower than the third
quarter as imports continue at high levels despite end users decreasing
drilling activity in order to operate within their 2012 capital budgets. 
Inventory management by our customers may also be a considerable factor as we
approach year-end.  Operating costs are expected to increase due to operating
inefficiencies caused by lower production volumes.

We expect a minimal tax provision/benefit in the fourth quarter primarily due
to the full valuation allowance on deferred tax assets in Canada.

*****

This release contains forward-looking statements with respect to market
conditions, operating costs, shipments, prices, capital spending, and employee
benefit costs and payments.  Although we believe that we are experiencing a
gradual economic recovery, there are signs of continued economic issues in
Europe and U. S. Steel cannot control or predict the impact.  Other more
normal factors that could affect market conditions, costs, shipments and
prices for both North American and European operations include: (a) foreign
currency fluctuations and related activities; (b) global product demand,
prices and mix; (c) global and company steel production levels; (d) plant
operating performance; (e) natural gas, electricity, raw materials and
transportation prices, usage and availability; (f) international trade
developments, including court decisions, legislation and agency decisions on
petitions and sunsets; (g) the impact of fixed prices in energy and raw
materials contracts (many of which have terms of one year or longer) as
compared to short-term contract and spot prices of steel products; (h) changes
in environmental, tax, pension and other laws; (i) the terms of collective
bargaining agreements; (j) employee strikes or other labor issues; and (k)
U.S. and global economic performance and political developments.  Domestic
steel shipments and prices could be affected by import levels and actions
taken by the U.S. Government and its agencies, including those related to
CO[2] emissions, climate change and shale gas development.  Economic
conditions and political factors in Europe and Canada that may affect U. S.
Steel Europe's and U. S. Steel Canada's results include, but are not limited
to: (l) taxation; (m) nationalization; (n) inflation; (o) government
instability; (p) political unrest; (q) regulatory actions; and (r) quotas,
tariffs, and other protectionist measures.  To the extent that actual 2012
results for U.S. and foreign income or loss vary from estimates applied at the
end of the most recent interim period, the actual tax provision or benefit
recognized in 2012 could be materially different from the forecasted amount. 
In accordance with "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995, cautionary statements identifying important
factors, but not necessarily all factors, that could cause actual results to
differ materially from those set forth in the forward-looking statements have
been included in U. S. Steel's Annual Report on Form 10-K for the year ended
December 31, 2011, and in subsequent filings for U. S. Steel.

*****

A Consolidated Statement of Operations (Unaudited), Consolidated Cash Flow
Statement (Unaudited), Condensed Consolidated Balance Sheet (Unaudited) and
Preliminary Supplemental Statistics (Unaudited) for U. S. Steel are attached.

The company will conduct a conference call on third quarter earnings on
Tuesday, October 30, at 2 p.m. EDT.  To listen to the webcast of the
conference call, visit the U. S. Steel website, www.ussteel.com, and click on
"Current Information" under the "Investors" section.

For more information on U. S. Steel, visit our website at www.ussteel.com.

 

UNITED STATES STEEL CORPORATION
CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited)
                           Quarter Ended                    Nine Months Ended
                           Sept. 30   June 30    Sept. 30   September 30
(Dollars in millions)      2012       2012       2011       2012       2011
NET SALES                  $          $          $          $          $    
                           4,652      5,017      5,081      14,841     15,065
OPERATING EXPENSES
(INCOME):
 Cost of sales (excludes   4,311      4,477      4,560      13,414     13,679
 items shown below)
 Selling, general and      166        173        181        512        550
 administrative expenses
 Depreciation, depletion   163        164        172        490        512
 and amortization
 Income from investees     (48)       (44)       (27)       (116)      (66)
 Net (gain) loss on        (1)        -          -          308        (10)
 disposal of assets
 Other income, net         (1)        (6)        (4)        (9)        (8)
              Total
              operating    4,590      4,764      4,882      14,599     14,657
              expenses
INCOME FROM OPERATIONS     62         253        199        242        408
Net interest and other     45         82         144        177        136
financial costs
INCOME BEFORE INCOME
TAXES 
 AND NONCONTROLLING        17         171        55         65         272
 INTERESTS
Income tax (benefit)       (27)       70         33         139        114
provision
Net income (loss)          44         101        22         (74)       158
 Less: Net income
 attributable to the 
 noncontrolling interests  -          -          -          -          -
NET INCOME (LOSS)
ATTRIBUTABLE TO 
 UNITED STATES STEEL       $          $          $          $          $      
 CORPORATION                 44       101          22        (74)        158
COMMON STOCK DATA:
Net income (loss) per
share attributable to 
United States Steel
Corporation shareholders:
 -Basic                    $          $          $          $          $      
                            0.30       0.70       0.15      (0.51)      1.10
 -Diluted                  $          $          $          $          $      
                            0.28       0.62       0.15      (0.51)      1.02
Weighted average shares,
in thousands
 -Basic                    144,350    144,176    144,067    144,199    143,932
 -Diluted                  171,673    171,416    144,452    144,199    171,534
Dividends paid per common  $          $          $          $          $      
share                       0.05       0.05       0.05       0.15       0.15

 

UNITED STATES STEEL CORPORATION
CONSOLIDATED CASH FLOW STATEMENT (Unaudited)
                                                          Nine Months Ended
                                                          September 30
(Dollars in millions)                                     2012       2011
Cash (used in) provided by operating activities:
    Net (loss) income                                     $          $        
                                                           (74)      158
    Depreciation, depletion and                           490        512
    amortization
    Pensions and other postretirement benefits            (112)      (74)
    Deferred income taxes                                 86         10
    Net loss on disposal of assets                        308        (10)
    Working capital changes                               215        (623)
    Income taxes receivable/payable                       27         148
    Currency remeasurement loss (gain)                    (13)       (26)
    Other operating activities                            31         13
                  Total                                   958        108
Cash (used in) provided by investing
activities:
    Capital expenditures^(a)                              (536)      (626)
    Disposal of assets                                    141        16
    Other investing activities                            (71)       (1)
                  Total                                   (466)      (611)
Cash provided by (used in) financing activities:
    Revolving credit facilities             - borrowings  523        3,316
                                            - repayments  (653)      (3,163)
    Receivables Purchase Agreement (payments) proceeds    (380)      75
    Issuance of long-term debt, net of financing costs    485        -
    Repayment of long-term debt                           (319)      (18)
    Common stock issued                                   -          4
    Dividends paid                                        (22)       (22)
    Other financing activities                            -          1
                  Total                                   (366)      193
Effect of exchange rate changes on cash                   2          2
Net increase (decrease) in cash and cash equivalents      128        (308)
Cash and cash equivalents at beginning of the year        408        578
Cash and cash equivalents at end of the period            $          $        
                                                          536        270
^(a)Excludes the change in accrued capital expenditures of $50 million for the
nine months ended September 30, 2012.  The change in accrued capital
expenditures was immaterial for the nine months ended September 30, 2011.  

 

UNITED STATES STEEL CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited)
                                                  Sept. 30       Dec. 31
(Dollars in millions)                             2012           2011
Cash and cash equivalents                         $         536  $         408
Receivables, net                                  2,412          2,053
Receivables sold to third party conduits          -              380
Inventories                                       2,525          2,775
Other current assets                              173            158
         Total current assets                     5,646          5,774
Property, plant and equipment, net                6,390          6,579
Investment and long-term receivables, net         645            683
Goodwill and intangible assets, net               2,071          2,045
Other assets                                      744            992
         Total assets                             $     15,496   $     16,073
Accounts payable                                  $       1,948  $       2,063
Payroll and benefits payable                      1,048          1,003
Short-term debt and current maturities of         1              20
long-term debt
Borrowings under Receivables Purchase Agreement   -              380
Other current liabilities                         270            183
         Total current liabilities                3,267          3,649
Long-term debt, less unamortized discount         3,939          3,828
Employee benefits                                 3,989          4,600
Other long-term liabilities                       438            495
United States Steel Corporation stockholders'     3,861          3,500
equity
Noncontrolling interests                          2              1
         Total liabilities and stockholders'      $     15,496   $     16,073
         equity

 

 

UNITED STATES STEEL CORPORATION
PRELIMINARY SUPPLEMENTAL STATISTICS (Unaudited)
                                  Quarter Ended              Nine Months Ended
                                  Sept.    June     Sept.    September 30
                                  30       30       30
(Dollars in millions)             2012     2012     2011     2012        2011
INCOME (LOSS) FROM OPERATIONS
   Flat-rolled                    $        $        $        $           $    
                                    29      177      203     389         541
   U. S. Steel Europe             27       34       (50)     27          (73)
   Tubular                        102      103      134      334         197
   Other Businesses               13       16       8        46          30
Reportable Segment and Other      171      330      295      796         695
Businesses Income from Operations
   Postretirement benefit         (74)     (77)     (96)     (228)       (287)
   expense
   Other items not allocated to
   segments:
         Loss on sale of U. S.    -        -        -        (399)       -
         Steel Serbia
         Gain on sale of          -        -        -        89          -
         transportation assets
         Property tax             -        -        -        19          -
         settlements
         Labor agreement lump     (35)     -        -        (35)        -
         sum payments
                Total Income      $        $        $        $           $    
                from Operations     62      253      199     242         408
CAPITAL EXPENDITURES
   Flat-rolled                    $        $        $        $           $    
                                    89      151      160     421         427
   U. S. Steel Europe             15       12       26       29          93
   Tubular                        17       4        30       25          94
   Other Businesses               8        1        9        11          12
                Total             $        $        $        $      (a)  $    
                                  129       168      225     486         626
^(a) Capital expenditures include $50 million of changes in accrued but unpaid
capital expenditures for the nine months ended September 30, 2012.  Changes in
the accrued but unpaid capital expenditures for the nine months ended
September 30, 2011 were not material. 

 

 

UNITED STATES STEEL CORPORATION
PRELIMINARY SUPPLEMENTAL STATISTICS (Unaudited)
                             Quarter Ended                   Nine Months Ended
                             Sept. 30    June 30   Sept. 30  September 30
                             2012        2012      2011      2012      2011
OPERATING STATISTICS
 Average realized price:
 ($/net ton) (a)
     Flat-rolled             741         772       773       759       765
     U. S. Steel Europe      731         767       862       749       868
     Tubular                 1,676       1,706     1,699     1,704     1,576
 Steel Shipments: (a) (b)
     Flat-rolled             3,972       3,986     3,835     12,050    11,725
     U. S. Steel Europe      911         955       1,196     2,911     3,779
     Tubular                 457         493       481       1,479     1,330
            Total Steel      5,340       5,434     5,512     16,440    16,834
            Shipments
 Intersegment Shipments: (b)
     Flat-rolled to Tubular  456         460       492       1,415     1,339
     U. S. Steel Europe to   128         44        -         249       71
     Flat-rolled
 Raw Steel Production: (b)
     Flat-rolled             4,699       4,688     4,516     14,430    14,008
     U. S. Steel Europe      1,140       1,173     1,317     3,553     4,429
 Raw Steel Capability
 Utilization: (c)
     Flat-rolled             77%         77%       74%       79%       77%
     U. S. Steel Europe      90%         94%       71%       90%       80%
        USSK                 90%         94%       82%       92%       87%
 (a) Excludes intersegment shipments.
 (b) Thousands of net tons.
 (c) Based on annual raw steel production capability of 24.3 million
 net tons for Flat-rolled
     and 7.4 million net tons for U. S. Steel Europe.  Subsequent to
     the sale of USSS
     on January 31, 2012, annual raw steel production capability for USSE is
     5.0 million net tons.

 

 

SOURCE United States Steel Corporation

Website: http://www.ussteel.com
Contact: Media, Erin DiPietro, +1-412-433-6845, Investors/Analysts, Dan
Lesnak, +1-412-433-1184
Sponsored Links
Advertisement
Advertisements
Sponsored Links
Advertisement