US Steel reported Wednesday a second quarter 2014 net loss of $18 million compared to a second quarter 2013 net loss of $78 million, and first quarter 2014 net income of $52 million.
Adjusted net income for the second quarter of 2014 was $25 million, excluding a charge of $46 million for litigation reserves; a loss on assets held for sale of $9 million; and a curtailment gain of $12 million.
The $132 million, or $26 per ton, of reportable segment and Other Businesses income from operations for the second quarter of 2014 compares to income from operations of $154 million, or $30 per ton, in the first quarter of 2014 and income from operations of $47 million, or $9 per ton, in the second quarter of 2013.
Results for the flat-rolled segment remained positive but decreased significantly from the first quarter.
The impacts of the extraordinary weather conditions and operational issues that began in the first quarter resulted in continuing operating inefficiencies; higher repairs and maintenance costs; and logistical issues that temporarily limited production capabilities during the second quarter. These events resulted in both higher operating costs and lower shipments as compared to the first quarter. Market conditions in North America did improve versus the first quarter, resulting in higher average realized proceeds in the second quarter.
Tubular results increased compared to the first quarter. Shipments were higher due to increased drilling activity while average realized prices were in line with the first quarter. Raw materials costs improved as compared to the first quarter.
Commenting on US Steel's outlook for the third quarter, President and CEO Mario Longhi said, “We expect operating income for our reportable segments and Other Businesses to increase significantly over the second quarter, as we return to normal operating levels. We continue to earn the right to grow as the Carnegie Way transformation allows us to better meet our customers' needs and improves our earnings power. ”
