U.S. Steel 2nd-quarter loss narrows

Pittsburgh Post-Gazette

U.S. Steel reported a smaller than expected second-quarter loss despite an 11 percent drop in sales.

The Pittsburgh steel producer cited continuing benefits from its Carnegie Way cost-cutting and efficiency campaign.

The company reported a loss of $46 million, or 32 cents per share, on sales of $2.58 billion vs. a loss of $261 million, or $1.79 per share, and sales of $2.9 billion in the year-ago quarter. The yearago results reflected a $255 million pretax loss related to writing down the value of its bankrupt Canadian operations.

Shipments were flat at 3.9

million tons.

Analysts had expected the company to report a loss of 43 cents per share on sales of $2.68 billion.

President and CEO Mario Longhi said the recent increases in steel prices will be more fully reflected in the company’s second-half performance, as it takes time for the price hikes to work into the company’s contracts with customers. Domestic prices increased after U.S. Steel and other steel producers filed trade complaints over lowpriced imports from China and other countries. Imports dropped 29 percent in the first half of this year according to the American Iron and Steel Institute.

“The significant improvements we have made to our earnings powered through our Carnegie Way transformation will become more apparent as market prices recover from the very low levels at the end of 2015,” Mr. Longhi said.

Selling, general and administrative expenses, fueled by jobs cuts and other initiatives, fell to $64 million for the quarter vs. $107 million a year ago.

The results were released after Wall Street closed.

U.S. Steel shares finished Tuesday at a 52-week high of $22.95. The shares have nearly tripled in value this year.