- First quarter 2024 net earnings of $171 million, or $0.68
per diluted share.
- First quarter 2024 adjusted net earnings of $206 million, or
$0.82 per diluted share. Includes an approximately $0.04 per
diluted share unfavorable inventory impact versus our March 18
adjusted net earnings per diluted share guidance of between $0.80
and $0.84 per diluted share.
- First quarter 2024 adjusted EBITDA of $414 million. Includes
an approximately $10 million unfavorable inventory impact versus
our March 18 adjusted EBITDA guidance of approximately $425
million.
United States Steel Corporation (NYSE: X) reported first quarter
2024 net earnings of $171 million, or $0.68 per diluted share.
Adjusted net earnings was $206 million, or $0.82 per diluted share.
This compares to first quarter 2023 net earnings of $199 million,
or $0.78 per diluted share. Adjusted net earnings for the first
quarter 2023 was $195 million, or $0.77 per diluted share.
Commenting on the Company’s first quarter performance, U. S.
Steel President and Chief Executive Officer, David B. Burritt said,
“We delivered a solid first quarter while maintaining an unwavering
focus on safety as we progress towards the close of our pending
transaction with Nippon Steel Corporation. First quarter adjusted
EBITDA of $414 million reflects the benefits of a diverse order
book and efficiently run operations in the midst of changing market
conditions, partly offset by an unfavorable inventory impact in our
North American Flat-Rolled segment. Both our North American
Flat-Rolled and Mini Mill segments generated sizeable sequential
increases in EBITDA, capturing higher steel prices and optimizing
product mix for improved profitability. Our European segment
successfully navigated a dynamic steel market backdrop to deliver
better than expected performance. Meanwhile, our Tubular segment
continued to deliver historically strong performance despite a
softer market environment.”
“We expect an even stronger second quarter, with adjusted EBITDA
in the range of $425 million to $475 million, as typical first
quarter seasonal mining headwinds abate,” continued Burritt. “This
should drive sequentially stronger EBITDA for our Flat-Rolled
segment, while our Mini Mill segment is expected to be negatively
impacted by lower average selling prices. Our U. S. Steel Europe
segment results are expected to remain challenged, reflecting
mounting commercial headwinds. As a result, we extended a planned
outage on blast furnace #2 to balance our production with demand.
We expect results in our Tubular segment to moderate as selling
prices decline.”
Commenting on the Company’s strategic initiatives, Burritt
concluded, “We continue to move closer to the completion of our
in-flight capital projects and the incremental earnings and
resilient cash flow they are expected to generate. We recently
commissioned our new dual Galvalume® / Galvanized coating line at
Big River Steel. This state-of-the-art finishing line will enhance
our product mix while meeting the demand of customers. Meanwhile,
we’re another quarter closer to the start-up of Big River 2, our
new mini mill in Osceola, Arkansas. Big River 2 remains on-track
for start-up in the second half of 2024. I invite you to review the
progress being made on Big River 2, which is showcased in our
investor presentation posted on our Investor Relations
webpage.”
Transaction Update
The Company continues to progress towards closing the
transaction with Nippon Steel Corporation. Last month, U. S. Steel
stockholders approved the merger with ~99% approval of shares
voted, satisfying a significant condition to closing. The Company
and Nippon Steel Corporation each received, and are working to
respond to, a request for additional information and documentary
materials (commonly referred to as a “second request”) from the
U.S. Department of Justice in connection with antitrust review of
the merger under the Hart-Scott-Rodino Antitrust Improvements Act
of 1976, as amended (the "HSR Act").
The Company currently expects that the merger will be completed
in the second half of 2024, subject to the fulfillment of the
remaining, customary closing conditions, including the expiration
or termination of the waiting period under the HSR Act and receipt
of other required regulatory approvals.
Earnings Highlights
Three Months Ended March 31,
(Dollars in millions, except per share
amounts)
2024
2023
Net Sales
$
4,160
$
4,470
Segment earnings (loss) before interest
and income taxes
Flat-Rolled
$
34
$
(7
)
Mini Mill
99
12
U. S. Steel Europe
16
(34
)
Tubular
57
232
Other
(2
)
3
Total segment earnings before interest
and income taxes
$
204
$
206
Other items not allocated to segments
(50
)
(17
)
Earnings before interest and income
taxes
$
154
$
189
Net interest and other financial
benefits
(55
)
(61
)
Income tax expense
38
51
Net earnings
$
171
$
199
Earnings per diluted share
$
0.68
$
0.78
Adjusted net earnings (a)
$
206
$
195
Adjusted net earnings per diluted share
(a)
$
0.82
$
0.77
Adjusted earnings before interest,
income taxes, depreciation and amortization (EBITDA) (a)
$
414
$
427
(a) Please refer to the non-GAAP Financial
Measures section of this document for the reconciliation of these
amounts.
UNITED STATES STEEL
CORPORATION
PRELIMINARY SUPPLEMENTAL
STATISTICS (Unaudited)
Three Months Ended March 31,
2024
2023
OPERATING STATISTICS
Average realized price: ($/net ton unless
otherwise noted) (a)
Flat-Rolled
1,054
1,012
Mini Mill
977
794
U. S. Steel Europe
830
909
U. S. Steel Europe (€/net ton)
764
847
Tubular
2,267
3,757
Steel shipments (thousands of net tons):
(a)
Flat-Rolled
2,049
2,278
Mini Mill
568
659
U. S. Steel Europe
1,072
883
Tubular
114
131
Total steel shipments
3,803
3,951
Intersegment steel (unless otherwise
noted) shipments (thousands of net tons):
Mini Mill to Flat-Rolled
112
83
Flat-Rolled to Mini Mill
1
—
Flat-Rolled to Mini Mill (pig iron)
77
29
Flat-Rolled to USSE (coal)
119
—
Raw steel production (thousands of net
tons):
Flat-Rolled
2,111
2,393
Mini Mill
717
759
U. S. Steel Europe
1,079
1,092
Tubular
146
171
Raw steel capability utilization: (b)
Flat-Rolled
64
%
74
%
Mini Mill
87
%
93
%
U. S. Steel Europe
87
%
89
%
Tubular
65
%
77
%
CAPITAL EXPENDITURES (dollars in
millions)
Flat-Rolled
139
139
Mini Mill
463
563
U. S. Steel Europe
28
26
Tubular
10
12
Other Businesses
—
—
Total
$
640
$
740
(a) Excludes intersegment shipments.
(b) Based on annual raw steel production
capability of 13.2 million net tons for Flat-Rolled, 3.3 million
net tons for Mini Mill, 5.0 million net tons for U. S. Steel Europe
and 0.9 million net tons for Tubular.
UNITED STATES STEEL
CORPORATION
CONDENSED STATEMENT OF OPERATIONS
(Unaudited)
Three Months Ended March 31,
(Dollars in millions, except per share
amounts)
2024
2023
Net Sales
$
4,160
$
4,470
Operating expenses (income):
Cost of sales
3,665
3,953
Selling, general and administrative
expenses
119
99
Depreciation, depletion and
amortization
210
221
(Earnings) loss from investees
(14
)
13
Asset impairment charges
7
4
Restructuring and other charges
6
1
Other losses (gains), net
13
(10
)
Total operating expenses
4,006
4,281
Earnings before interest and income
taxes
154
189
Net interest and other financial
benefits
(55
)
(61
)
Earnings before income taxes
209
250
Income tax expense
38
51
Net earnings
171
199
Less: Net earnings attributable to
noncontrolling interests
—
—
Net earnings attributable to United States
Steel Corporation
$
171
$
199
COMMON STOCK DATA:
Net earnings per share attributable to
United States Steel Corporation Stockholders
Basic
$
0.76
$
0.87
Diluted
$
0.68
$
0.78
Weighted average shares, in thousands
Basic
224,099
227,332
Diluted
254,584
257,447
Dividends paid per common share
$
0.05
$
0.05
UNITED STATES STEEL
CORPORATION
CONDENSED CASH FLOW STATEMENT
(Unaudited)
Three Months Ended March 31,
Three Months Ended March 31,
(Dollars in millions)
2024
2023
Increase (decrease) in cash, cash
equivalents and restricted cash
Operating activities:
Net earnings
$
171
$
199
Depreciation, depletion and
amortization
210
221
Asset impairment charges
7
4
Restructuring and other charges
6
1
Pensions and other postretirement
benefits
(28
)
(41
)
Active employee benefit investments
30
(3
)
Deferred income taxes
36
38
Working capital changes
(312
)
(47
)
Income taxes receivable/payable
5
10
Other operating activities
(153
)
(201
)
Net cash (used in) provided by operating
activities
(28
)
181
Investing activities:
Capital expenditures
(640
)
(740
)
Proceeds from sale of assets
—
2
Other investing activities
(5
)
—
Net cash used in investing activities
(645
)
(738
)
Financing activities:
Repayment of long-term debt
(14
)
(10
)
Common stock repurchased
—
(75
)
Other financing activities
(32
)
(32
)
Net cash used in financing activities
(46
)
(117
)
Effect of exchange rate changes on
cash
(7
)
8
Net decrease in cash, cash equivalents and
restricted cash
(726
)
(666
)
Cash, cash equivalents and restricted cash
at beginning of year
2,988
3,539
Cash, cash equivalents and restricted cash
at end of period
$
2,262
$
2,873
UNITED STATES STEEL
CORPORATION
CONDENSED BALANCE SHEET
(Unaudited)
March 31,
December 31,
(Dollars in millions)
2024
2023
Cash and cash equivalents
$
2,221
$
2,948
Receivables, net
1,722
1,548
Inventories
2,157
2,128
Other current assets
321
319
Total current assets
6,421
6,943
Operating lease assets
99
109
Property, plant and equipment, net
10,807
10,393
Investments and long-term receivables,
net
785
761
Intangibles, net
431
436
Goodwill
920
920
Other noncurrent assets
985
889
Total assets
$
20,448
$
20,451
Accounts payable and other accrued
liabilities
2,948
3,028
Payroll and benefits payable
322
442
Short-term debt and current maturities of
long-term debt
159
142
Other current liabilities
319
336
Total current liabilities
3,748
3,948
Noncurrent operating lease liabilities
65
73
Long-term debt, less unamortized discount
and debt issuance costs
4,082
4,080
Employee benefits
116
126
Deferred income tax liabilities
629
587
Other long-term liabilities
516
497
United States Steel Corporation
stockholders' equity
11,199
11,047
Noncontrolling interests
93
93
Total liabilities and stockholders'
equity
$
20,448
$
20,451
UNITED STATES STEEL
CORPORATION
NON-GAAP FINANCIAL MEASURES
RECONCILIATION OF ADJUSTED NET
EARNINGS
Three Months Ended March 31,
(In millions of dollars)
2024
2023
Net earnings and diluted net earnings per
share attributable to United States Steel Corporation, as
reported
$
171
$
0.68
$
199
$
0.78
Restructuring and other charges
6
1
Stock-based compensation expense
11
11
Asset impairment charges
7
4
VEBA asset surplus adjustment
(4
)
(22
)
Environmental remediation charges
2
—
Strategic alternatives review process
costs
23
—
Granite City idling costs
1
—
Other charges, net
—
1
Adjusted pre-tax net earnings to United
States Steel Corporation
217
194
Tax impact of adjusted items (a)
(11
)
1
Adjusted net earnings and diluted net
earnings per share attributable to United States Steel
Corporation
$
206
$
0.82
$
195
$
0.77
Weighted average diluted ordinary shares
outstanding, in millions
254.6
257.4
(a) The tax impact of adjusted items for
both the three months ended March 31, 2024 and 2023 were calculated
using a blended tax rate of 24%.
UNITED STATES STEEL
CORPORATION
NON-GAAP FINANCIAL MEASURES
RECONCILIATION OF ADJUSTED
EBITDA
Three Months Ended March 31,
(Dollars in millions)
2024
2023
Reconciliation to Adjusted EBITDA
Net earnings attributable to United States
Steel Corporation
$
171
$
199
Income tax expense
38
51
Net interest and other financial
benefits
(55
)
(61
)
Depreciation, depletion and amortization
expense
210
221
EBITDA
364
410
Restructuring and other charges
6
1
Stock-based compensation expense
11
11
Asset impairment charges
7
4
Environmental remediation charges
2
—
Strategic alternatives review process
costs
23
—
Granite City idling costs
1
—
Other charges, net
—
1
Adjusted EBITDA
$
414
$
427
Net earnings margin (a)
4.1
%
4.5
%
Adjusted EBITDA margin (a)
10.0
%
9.6
%
(a) The net earnings and adjusted EBITDA
margins represent net earnings or adjusted EBITDA divided by net
sales.
UNITED STATES STEEL
CORPORATION
NON-GAAP FINANCIAL MEASURES
RECONCILIATION OF PAST TWELVE
MONTHS OF FREE AND INVESTABLE CASH FLOW
2nd
3rd
4th
1st
Quarter
Quarter
Quarter
Quarter
Total of the
(Dollars in millions)
2023
2023
2023
2024
Four Quarters
Net cash provided (used) by operating
activities
$
713
$
817
$
389
$
(28
)
$
1,891
Net cash used in investing activities
(612
)
(585
)
(633
)
(645
)
(2,475
)
Free cash flow
101
232
(244
)
(673
)
(584
)
Strategic capital expenditures
476
423
425
468
1,792
Investable free cash flow
$
577
$
655
$
181
$
(205
)
$
1,208
We present adjusted net earnings, adjusted net earnings per
diluted share, earnings before interest, income taxes, depreciation
and amortization (EBITDA), adjusted EBITDA and adjusted EBITDA
margin, which are non-GAAP measures, as additional measurements to
enhance the understanding of our operating performance. We believe
that EBITDA, considered along with net earnings, is a relevant
indicator of trends relating to our operating performance and
provides management and investors with additional information for
comparison of our operating results to the operating results of
other companies.
Adjusted net earnings and adjusted net earnings per diluted
share are non-GAAP measures that exclude the effects of items that
include: restructuring and other charges, stock-based compensation
expense, asset impairment charges, VEBA asset surplus adjustment,
environmental remediation charges, strategic alternatives review
process costs, Granite City idling costs, tax impact of adjusted
items and other charges, net (Adjustment Items). Adjusted EBITDA
and adjusted EBITDA margins are also non-GAAP measures that exclude
the effects of certain Adjustment Items. We present adjusted net
earnings, adjusted net earnings per diluted share, adjusted EBITDA
and adjusted EBITDA margin to enhance the understanding of our
ongoing operating performance and established trends affecting our
core operations by excluding the effects of events that can obscure
underlying trends. U. S. Steel's management considers adjusted net
earnings, adjusted net earnings per diluted share, adjusted EBITDA,
and adjusted EBITDA margin as alternative measures of operating
performance and not alternative measures of the Company's
liquidity. U. S. Steel’s management considers adjusted net
earnings, adjusted net earnings per diluted share, adjusted EBITDA,
and adjusted EBITDA margin useful to investors by facilitating a
comparison of our operating performance to the operating
performance of our competitors. Additionally, the presentation of
adjusted net earnings, adjusted net earnings per diluted share,
adjusted EBITDA, and adjusted EBITDA margin provides insight into
management’s view and assessment of the Company’s ongoing operating
performance because management does not consider the Adjustment
Items when evaluating the Company’s financial performance. Adjusted
net earnings, adjusted net earnings per diluted share, adjusted
EBITDA, and adjusted EBITDA margin should not be considered a
substitute for net earnings, earnings per diluted share or other
financial measures as computed in accordance with U.S. GAAP and are
not necessarily comparable to similarly titled measures used by
other companies.
We also present free cash flow, a non-GAAP measure of cash
generated from operations after any investing activity and
investable free cash flow, a non-GAAP measure of cash generated
from operations after any investing activity adjusted for strategic
capital expenditures. We believe that free cash flow and investable
free cash flow provide further insight into the Company's overall
utilization of cash. A condensed consolidated statement of
operations (unaudited), condensed consolidated cash flow statement
(unaudited), condensed consolidated balance sheet (unaudited) and
preliminary supplemental statistics (unaudited) for U. S. Steel are
attached.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING
STATEMENTS
This release contains information regarding the Company that may
constitute “forward-looking statements,” as that term is defined
under the Private Securities Litigation Reform Act of 1995 and
other securities laws, that are subject to risks and uncertainties.
We intend the forward-looking statements to be covered by the safe
harbor provisions for forward-looking statements in those sections.
Generally, we have identified such forward-looking statements by
using the words “believe,” “expect,” “intend,” “estimate,”
“anticipate,” “project,” “target,” “forecast,” “aim,” “should,”
“plan,” “goal,” “future,” “will,” “may” and similar expressions or
by using future dates in connection with any discussion of, among
other things, statements expressing general views about future
operating or financial results, operating or financial performance,
trends, events or developments that we expect or anticipate will
occur in the future, anticipated cost savings, potential capital
and operational cash improvements and changes in the global
economic environment, the construction or operation of new or
existing facilities or capabilities, statements regarding our
greenhouse gas emissions reduction goals, as well as statements
regarding the proposed transaction, including the timing of the
completion of the transaction. However, the absence of these words
or similar expressions does not mean that a statement is not
forward-looking. Forward-looking statements include all statements
that are not historical facts, but instead represent only the
Company’s beliefs regarding future goals, plans and expectations
about our prospects for the future and other events, many of which,
by their nature, are inherently uncertain and outside of the
Company’s control. It is possible that the Company’s actual results
and financial condition may differ, possibly materially, from the
anticipated results and financial condition indicated in these
forward-looking statements. Management of the Company believes that
these forward-looking statements are reasonable as of the time
made. However, caution should be taken not to place undue reliance
on any such forward-looking statements because such statements
speak only as of the date when made. In addition, forward looking
statements are subject to certain risks and uncertainties that
could cause actual results to differ materially from the Company’s
historical experience and our present expectations or projections.
Risks and uncertainties include without limitation: the ability of
the parties to consummate the proposed transaction on a timely
basis or at all; the timing, receipt and terms and conditions of
any required governmental and regulatory approvals of the proposed
transaction; the occurrence of any event, change or other
circumstances that could give rise to the termination of the
definitive agreement and plan of merger relating to the proposed
transaction (the “Merger Agreement”); the risk that the parties to
the Merger Agreement may not be able to satisfy the conditions to
the proposed transaction in a timely manner or at all; risks
related to disruption of management time from ongoing business
operations due to the proposed transaction; certain restrictions
during the pendency of the proposed transaction that may impact the
Company’s ability to pursue certain business opportunities or
strategic transactions; the risk that any announcements relating to
the proposed transaction could have adverse effects on the market
price of the Company’s common stock; the risk of any unexpected
costs or expenses resulting from the proposed transaction; the risk
of any litigation relating to the proposed transaction; the risk
that the proposed transaction and its announcement could have an
adverse effect on the ability of the Company to retain customers
and retain and hire key personnel and maintain relationships with
customers, suppliers, employees, stockholders and other business
relationships and on its operating results and business generally;
and the risk the pending proposed transaction could distract
management of the Company. The Company directs readers to its
Quarterly Report on Form 10-Q for the quarter ended September 30,
2023 and Form 10-K for the year ended December 31, 2023, and the
other documents it files with the SEC for other risks associated
with the Company’s future performance. These documents contain and
identify important factors that could cause actual results to
differ materially from those contained in the forward-looking
statements.
Founded in 1901, United States Steel Corporation is a leading
steel producer. With an unwavering focus on safety, the Company’s
customer-centric Best for All® strategy is advancing a more secure,
sustainable future for U. S. Steel and its stakeholders. With a
renewed emphasis on innovation, U. S. Steel serves the automotive,
construction, appliance, energy, containers, and packaging
industries with high value-added steel products such as U. S.
Steel’s proprietary XG3® advanced high-strength steel. The Company
also maintains competitively advantaged iron ore production and has
an annual raw steelmaking capability of 22.4 million net tons. U.
S. Steel is headquartered in Pittsburgh, Pennsylvania, with
world-class operations across the United States and in Central
Europe. For more information, please visit www.ussteel.com.
©2024 U. S. Steel All Rights Reserved
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version on businesswire.com: https://www.businesswire.com/news/home/20240502007653/en/
Corporate Communications T - (412) 433-1300 E - media@uss.com
Emily Chieng Investor Relations Officer T - (412) 618-9554 E -
ecchieng@uss.com
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