Steel Products
US Steel Reports 4Q and Full Year 2012 Loss
Written by Sandy Williams
January 30, 2013
Written by Sandy Williams
United States Steel Corporation reported a net loss of $50 million for the fourth quarter of 2012 compared to net income of $44 million in the third quarter and a net loss of $211 million in fourth quarter 2011.
Total earnings for the year 2012 showed a net loss of $124 compared to a net loss of $43 million in 2011. Full year losses included a net loss of $353 million primarily due to the sale of U.S. Steel Serbia.
“For the third consecutive quarter all three of our reportable segments had positive operating results despite the uncertain global economic environment,” said US Steel Chairman and CEO John Surma. “Lower drilling and project line pipe activity, as well as continued high import levels, significantly reduced our Tubular segment’s results. For our Flat-rolled segment, our profitability was negatively affected by the uncertain domestic fiscal situation as well as continued high levels of flat-rolled steel imports.”
Income were positive for all company segments in the fourth quarter but down from the third quarter due to lower average realized prices that were somewhat offset by decreases in raw materials. Flat-rolled income totaled $11 million, European income was $7 million, and tubular income was $32 million for the quarter.
For the calendar year the flat-rolled segment income was $400 million, U.S. Steel Europe income was $34 million, Tubular posted income of $366 million and their other business interests posted income totaling $55 million with the company reporting total sales of $19.328 billion.
The outlook for US Steel is for slight improvement in the European and tubular segments but break-even results for flat-rolled. Recent price increases should push spot prices higher while being offset by market-based contracts. Raw materials are expected to decrease slightly as lower coal prices offset higher scrap prices. Overall operating costs are expected to rise slightly over fourth quarter costs.
The European segment is expected to see an increase in shipments as service centers and distributors restock. Average price may drop and iron ore prices are expected to increase in the fourth quarter.
The tubular segment is forecast to have decreased operating costs and an increase in shipments as drilling activity picks up. Average realized prices are expected to be increase in the first quarter of 2013.
Sandy Williams
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