Corporation (USS) is reporting a net loss in 2015 of $1.5 billion ($10.32
per diluted share), compared to a net income in 2014 of $102 million
(69 cents), compared also to a net loss in 2013 of $1.645 billion
charges of $426 million ($2.92 per diluted share) for “restructuring and
other strategic actions,” of $766 million ($5.24) for a full valuation
allowance related to the company’s domestic deferred tax assets, and of $18
million (2 cents) for impairment on an equity investment--excluding as well
a charge of $36 million (25 cents) related to the retirement of the
company’s 2.75-percent Senior Convertible Notes--the adjusted net loss in
2015 was $262 ($1.79 per diluted share).
The 2014 net income
of $102 million included net charges of $574 million (69 cents per diluted
share) mostly due to non-cash charges for strategic actions.
USS is also
reporting a net loss in the fourth quarter of $999 million ($6.38 per
diluted share), compared to a net loss in the third quarter of $173 million
($1.18) and a net income in the year-ago of $275 ($1.83).
“The $815 of
Carnegie Way benefits we realized in 2015 show that we continue to make
significant progress on our journey toward our goal of achieving economic
profit across the business cycle,” USS President and CEO Mario Longhi said.
“Our progress is real and it is substantial, but our fourth quarter and
full-year results show that it is not yet enough to fully overcome some of
the work market and business conditions we have seen.”
The Carnegie Way,
introduced in 2013, is a strategic belt-tightening described as a
“disciplined approach” to “earn the right to grow and drive and sustain
“We are facing
significant headwinds and uncertainty in many of the markets we serve but
remain focused on continuing to improve our cost structure, developing
differentiated solutions for our customers and creating more reliable and
agile operating capabilities,” Longhi said.
“We have a strong
and growing pipeline of Carnegie Way projects that will provide benefits in
our operating segments and all other areas of our company,” he added. “The
substantive changes and improvements we are making continue to increase our
earnings power. We are working hard every day to serve our customers and are
well positioned to respond to improving market conditions.”
“At current market
conditions,” USS said, “we would expect lower results in each of our
operating segments as compared to 2015. We would expect that the operating
efficiencies related to our current facility configuration, lower raw
materials, operating and overhead costs, and additional Carnegie Way
benefits would only partially offset the unfavorable effects of lower
average realized prices and volumes.”
“based on current market conditions”: improved results for Other Businesses,
chiefly from real estate; lower post-retirement benefits expenses; and
approximately $500 million in cash benefits from working capital
improvements in 2016, mostly related to better inventory management.
Earnings Before Interest, Income Taxes
* Flat-rolled: a
loss of $237 million in 2015 (earnings of $709 million in 2014); a loss of
$88 million in 4Q (a loss of $18 million in 3Q, earnings of 247 million in
year-ago). USS attributed full-year results for Flat-rolled to lower
shipments and average realized prices “due primarily to the negative impact
of imports” and “high supply-chain inventories,” partially offset by
Carnegie Way efforts.
* U.S. Steel Europe
(USSE): earnings of $81 million in 2015 ($133 million in 2014); earnings of
$6 million in 4Q ($18 million in 3Q, $34 million in year-ago).
* Tubular: a loss
of $179 million in 2015 (earnings of $261 in 2014); loss of $64 million in
4! (loss of $50 million in 3Q, earnings of $121 million in year-ago).
* Other businesses:
earnings of $33 million in 2015 ($82 million in 2014); earnings of $9
million in 4Q ($10 million in 3Q, $18 million in year-ago).
* Total earnings
before interest and income taxes: a loss of $1.055 billion in 2015 (earnings
of $413 in 2014); a loss of $306 million in 4Q (a loss of $170 million in
3Q, earnings of $397 in year-ago).
More 2015 Numbers
* Average realize
price per ton of flat-rolled: $695 ($772 in 2014).
* Total USS and
USSE shipments: 15.5 million net tons (19.8 million in 2014).
* Flat-rolled steel
capability at U.S. facilities: 60 percent (78 percent in 2014).
* Raw flat-rolled
steel production at U.S. facilities: 11.3 million net tons (16.9 million in
capital expenditures: $280 million ($322 in 2014).
* Net sales: $11.57
billion ($17.5 billion in 2014).
* USS retired $379
million in debit.
* At the end of
2015 the company had $755 million in cash and $2.4 billion in liquidity,
compared to $1.4 billion in cash and $3.1 billion in liquidity at the end of