US Steel Corp. today provided second quarter 2021 guidance, indicating that adjusted EBITDA is expected to be approximately $1.2 billion. Second quarter 2021 adjusted net income is expected to be approximately $880 million and excludes impacts primarily related to certain restructuring and asset impairment charges. The company expects second quarter 2021 adjusted diluted earnings per share to be approximately $3.08.
The Flat-rolled segment is expected to generate more than double first quarter’s EBITDA. In a press release, the company said higher steel selling prices continue to be reflected in adjustable contracts and spot selling prices. Additionally, the absence of seasonal mining headwinds from the first quarter are also expected to contribute to higher EBITDA performance, quarter-over-quarter.
The Mini Mill segment is expected to exceed first quarter’s already industry leading EAF-based performance. Improved efficiencies from a fully ramped Phase 2 expansion and higher steel selling prices are expected to contribute to record setting EBITDA margins for the segment.
In Tubular, the company said market conditions are steadily improving. Oil and natural gas rigs are coming back on-line supported by higher oil and natural gas prices. This is starting to move pipe inventory within the supply chain and increase customer demand for new product, US Steel said. The company expects near breakeven EBITDA performance in the second quarter aided by increased customer activity, higher selling prices, and improved cost performance as we begin consuming more internally produced rounds from the Fairfield electric arc furnace.
“Higher steel prices and strong flat-rolled steel demand coupled with well-run operations are expected to deliver adjusted EBITDA that more than doubles our first quarter performance,” commented US Steel President and Chief Executive Officer David B. Burritt. “Continued strong demand and low steel inventories are empowering today’s ongoing market improvements. These market fundamentals are showing no signs of slowing down and have us increasingly confident of another strong year in 2022.”
Burritt continued, "As a result, we recently announced a new sustainable non-grain oriented electrical steel line investment at Big River Steel. This technologically advanced electrical steel line is expected to be funded by cash generated from Big River Steel’s robust profitability and cash flow. We continue to evaluate opportunities to accelerate our transition to a Best for All℠ future while executing our near-term priority to strengthen our balance sheet.”