Steel Mills
U.S. Steel Posts Lower Q3 Profit on Drop in Sheet Prices. Quiet on Sales Process
Written by Michael Cowden
October 26, 2023
U.S. Steel Corp.
| Third quarter ended Sept. 30 | 2023 | 2022 | % Change |
|---|---|---|---|
| Net sales | $4,431 | $5,203 | -14.8% |
| Net earnings | $299 | $490 | -40% |
| Per diluted share | $1.20 | $1.85 | -35.1% |
| Nine months ended Sept. 30 | |||
| Net sales | $13,909 | $16,727 | -16.8% |
| Net earnings | $975 | $2,350 | -58.5% |
| Per diluted share | $3.86 | $8.38 | -53.9% |
U.S Steel posted sharply lower earnings on a drop in steel prices and only modest gains in shipments.
The Pittsburgh-based steelmaker also said little about the sales process it launched in August in commentary released with earnings data after the close of markets on Thursday, Oct. 26.
U.S. Steel “is progressing a robust and competitive strategic alternatives review process to maximize stockholder value,” company president and CEO David Burritt said in a statement.
Cleveland-Cliffs, which has announced it intentions to acquire U.S. Steel, also said little specific about its bid when it announced earnings earlier in the week.
All told, U.S. Steel recorded net earnings of $299 million in the third quarter of 2023, down 35.1% from $490 million in the same quarter last year. It notched sales of $4.43 billion, 14.8% lower than Q3’22. (see chart above).
The company recorded total steel shipments 3.78 million tons in Q3’23, up 2.1% from 3.70 million tons in Q3’2022. That modest gain was offset by lower prices.
U.S. Steel posted averaged selling prices at $1,036 per ton at its integrated mills in Q3’23, down 15.9% from $1,232 per ton in Q3’22. Its Big River Steel EAF sheet mill in Osceola, Ark., recorded average selling prices of $901 per ton in Q3’22, down 17.8% from $1,096 per ton a year earlier.
U.S. Steel competitors Nucor and Steel Dynamics Inc. (SDI) posted a dip in profits for similar reasons.
Michael Cowden
Read more from Michael CowdenLatest in Steel Mills
Cliffs talks DOE funding, blast furnace relining schedule
The future of two projects supported in part by funding through the Department of Energy remains uncertain.
Cleveland-Cliffs open to asset sales
Meanwhile, its Canadian operations have been hurt by the broader tariffs proposed by the United States.
As Q1 loss balloons, Cliffs pledges to cut costs, streamline operations
Cleveland-Cliffs Inc. gushed red ink in the first quarter, and pledged to stem the bleeding by idling inefficient, “loss-making operations” and increasing focus on its core automotive business.
Cliffs plans to idle three mills, cut 950 jobs on ‘insufficient demand and pricing’
Cleveland-Cliffs plans to indefinitely idle its steel mill in Riverdale, Ill., as well as mills in Conshohocken, Pa., and Steelton, Pa. The Cleveland-based steelmaker said all three facilities would be idled on or around June 30. Approximately 950 jobs will be impacted, the company said.
CRU: Usiminas may reduce capex unless government strengthens protection
“The lack of effective measures to create fair competition, amid a surge in subsidized imports, is the main threat to the sustainability of Brazil’s steel industry and its value chain,” CEO Marcelo Chara said.