U.S. Steel reported a fourth quarter loss of $999 million Tuesday, bringing losses for all of 2015 to $1.51 billion. Savings from the Pittsburgh steel producer’s efficiency campaign were overwhelmed by slumping prices and lower shipments.
The fourth quarter loss amounted to $6.83 per share. Sales fell 37 percent to $2.57 billion. Shipments fell 19 percent, while average prices for the company’s sheet products fell 17 percent. Slumping conditions in the oil patch sent averaged prices for tubular products down 22 percent.
The company’s U.S. sheet mills operated at 57 percent of capacity during the quarter and 60 percent for all of last year.
Results for the fourth quarter and all of 2015 include a non-cash charge of $766 million, or $5.24 per share, related to the possibility the company may not be able to use past losses to offset income tax expenses in future years.
“We are facing significant headwinds and uncertainty in many of the markets we serve,” president and CEO Mario Longhi said in a statement.
He said the company realized $815 million in savings last year from the company’s Carnegie Way efficiency initiative.
If current market conditions persist, U.S. Steel said the benefits of lower raw material prices, additional Carnegie Way savings, and reduced overhead and operating costs would only partially offset the impact of lower steel prices and reduced shipments it expects this year.
Mr. Longhi is scheduled to discuss the results with analysts during a conference call this morning.
The results were reported after the market closed. U.S. Steel shares ended Tuesday at $7.77, up 85 cents. They are down 3 percent this year.
Source: Post Gazzate