AK Steel announces first quarter earnings

AK Steel announces first quarter earnings

AK Steel on Tuesday reported net income of $59.2 million, or $0.54 per share of common stock, for the first quarter of 2005. The company’s net income would have been $62.3 million, or $0.56 per share, had a Kentucky tax law change enacted in March not resulted in a reduction in value of a deferred tax asset. While an overwhelming majority of steelmakers have been reporting significant year-on-year gains in 2005 first quarter earnings, AK Steel saw its 2005 Q1 net income plummet nearly 65% from a year ago. However, AK Steel’s 2004 Q1 earnings of $165.4 million ($1.52 per share) included an after-tax gain of $174.9 ($1.61 per share) on the sale of a non-core asset. AK Steel, in fact, posted its best quarterly operating profit per ton since 1995 during the first quarter of 2005. The company’s per-ton operating profit of $75 was substantially better than the $1 per-ton profit it recorded in Q1 2004. In addition, while AK Steel’s tons shipped were similar, 1’514’300 tons in Q1 2004 compared to 1’520’500 tons in Q1 2005, net sales revenue rose 25% year on year to $1.4225 billion. Looking ahead to the second quarter, AK Steel said that it expects shipments to be approximately 1’600’000 tons. The company indicated that its projections reflect continued strong shipments to the carbon, stainless, and electrical markets and no significant planned maintenance outages. The company also expects costs of raw material to increase over first quarter 2005 levels. As a result, AK Steel anticipates second quarter operating profit in the $55 to $60 per ton range. AK Steel, a Fortune 500 company headquartered in Middletown, Ohio, produces flat-rolled carbon, stainless and electrical steels, as well as tubular steel products for the automotive, appliance, construction and manufacturing markets.