US Steel earnings down sharply in Q4
Pittsburgh, Pennsylvania-based steelmaker
US Steel reported its net sales for the fourth quarter ended December 31, 2005 totalled $3.47 billion, representing an 11 percent decrease from Q4 2004 net sales of $3.89 billion.
The loss in net sales was largely due to delays in putting the company's Gary Works blast furnace back online after rebuilding, which caused in a drastic drop in flat rolled sales from the previous year.
Net income fell to $109 million, or $0.85 per diluted share, from $451 million, or $3.46 per diluted share, earned in the fourth quarter of 2004. Year-to-date net income for Q5 2005 was $910 million, compared $1.14 billion earned in 2004.
Commenting on the quarterly results,
US Steel President and CEO John P. Surma said, "A strong fourth quarter operating performance contributed to making 2005 a very good year. Our annual earnings were the second highest on record and we had another year of solid return on capital employed. Importantly, our safety performance improved substantially, thanks to the outstanding efforts of our employees. Capital spending and repair and maintenance expenses were higher than anticipated primarily because we expanded the scope of work and experienced several delays related to the Gary No. 14 blast furnace project. We are proceeding through the start-up process and expect to be producing at full capacity of 9'200 tons of hot metal per day in a relatively short time."
"The first quarter of 2006 looks good for our domestic and European markets," Surma continued. "Service center and end customer inventories are balanced and we expect continued strength in the energy markets served by our
Tubular segment . . . We expect higher raw material costs to be partially offset by reduced outage costs."
US Steel manufactures a wide variety of steel sheet,
tubular and tin products, coke, and taconite pellets, with a worldwide annual raw steel capability of 26.8 million net tons. The company has a number of
steelmaking facilities on the US East Coast, South, and Midwest, as well as international ventures in Eastern
Europe and
Mexico.