United States Steel Corp. (X), Tuesday reported a net loss for the fourth quarter over a profit last year, hurt by lower average realized price and weak steel shipments. Looking ahead, the company said that the business conditions gradually improving as the U.S. and global economies are in the early stages of a gradual recovery.
The company reported a net loss of $267 million or $1.86 per share for the fourth quarter, compared to net income of $290 million or $2.50 per share in the prior year quarter.
On average, 13 analysts polled by Thomson Reuters expected the company to report a loss of $1.44 per share for the fourth quarter. Analysts' estimates typically exclude special items.
Result for the quarter included a catch-up benefit adjustment of $36 million or $0.25 per share, and a pre-tax charge of $49 million related to the accrual of estimated environmental remediation costs at a former production site.
Loss from operations was $329 million, compared to income of $522 million in the fourth quarter of 2008.
Fourth quarter net sales decreased to $3.35 billion from $4.50 billion in the same quarter last year. Eight analysts had a consensus revenue estimate of $3.09 billion for the fourth quarter.
In the previous third quarter, U. S. Steel reported a net loss of $303 million or $2.11 per share on net sales of $2.82 billion.
The company attributed the modest improvement in its fourth quarter results over the third quarter to higher average realized prices, increased shipments and higher utilization rates for Flat-rolled operations.
Total steel shipments for the fourth quarter increased to $4.65 billion from $4.20 billion in the year-ago quarter.
U. S. Steel reported a segment loss from operations of $245 million or $53 per ton in the fourth quarter of 2009, compared to income of $418 million or $100 per ton in the previous year quarter.
Flat-rolled segment posted a loss from operations of $284 million, compared to a loss of $21 million a year ago. Loss from operations of U.S. Steel Europe narrowed to $3 million from $141 million in last year. Tubular segment's income from operations plunged to $39 million from $559 million in the previous year quarter.
Total operating expenses for the fourth quarter eased to $3.68 billion from $3.98 billion in the prior year quarter.
At of December 31, 2009, U. S. Steel had $1.2 billion of cash and $2.5 billion of total liquidity, compared to $0.7 billion of cash and $2.1 billion of total liquidity at December 31, 2008.
For full-year 2009, U. S. Steel reported a net loss of $1.40 billion or $10.42 per share, compared to net income of $2.11 billion or $17.96 per share in the previous year.
Annual net sales declined to $11.05 billion from $23.75 billion in the prior year.
Analysts expected the company to report a net loss of $10.40 per share on revenue of $10.71 billion for the year 2009.
Looking ahead, U. S. Steel expects to report an operating loss for the first quarter of 2010, in-line with the fourth quarter 2009.
The company said, "A gradually strengthening economy should result in improvements in real demand, while apparent demand will likely be positively influenced by the restocking of the manufacturing supply chain, which we believe is under way."
Capital expenditures for 2010 are expected to be about $530 million, and remain focused largely on environmental and other infrastructure projects.
Among others in the industry, AK Steel Holding Corp. (AKS) Monday reported a profit for the fourth quarter, compared to a net loss last year, helped by lower costs stemming mainly from the absence of last year's accounting charge. Shipments improved during the quarter, but average selling prices declined from the previous year.
Nucor Corp. (NUE) reported that its third quarter profit plunged over the year-ago, hurt by weak demand for steel from residential and non-residential construction, as well as falling prices.
U. S. Steel is currently trading at $51.24, down $4.99 or 8.87% on a volume of 23.57 million shares.
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