Steel Mills
Import Pricing and Volume Reduce Q4 Shipments at AK Steel
Written by Sandy Williams
December 18, 2015
AK Steel joins other steelmakers in reporting reduced shipment volumes for fourth quarter. In its guidance report, the company says it expects shipments of approximately 1.6 million tons, down 14 percent from Q3. The decrease is a result of reduced sales in the carbon steel spot market due to the adverse impact of pricing from high levels of imported steel.
Average selling price per ton is expected to increase two percent from third quarter to approximately $930 per ton. AK Steel attributes the slight increase to a great mix of higher value products sold to the automotive market.
Fourth quarter results will be negatively impacted by charges related to the temporary idling of its Ashland, Kentucky Works and an impairment charge on its discontinued insurance operation, AFSG Holdings, Inc. The idling of Ashland will incur ongoing costs of $2-3 million per month beginning in Q1 2016 but will be offset by cost savings and higher operating rates at the Middletown, Ohio Works and Dearborn facilities and a better product mix.
AK Steel also anticipates higher income tax expense of $34 million, compared to $17.2 million in Q3, due to an increase in estimated LIFO income.
AK Steel said that it expects to report a net loss of $0.33 to $0.38 per diluted share of common stock for the fourth quarter of 2015, equivalent to approximately $55 million.
Sandy Williams
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