- Net earnings of $2.002 billion, or $6.97 per diluted
share
- Adjusted net earnings of $1.543 billion, or $5.36 per
diluted share
- Adjusted EBITDA of $2.027 billion
- Liquidity of $4.503 billion, including cash of $2.044
billion
United States Steel Corporation (NYSE: X) reported third quarter
2021 net earnings of $2.002 billion, or $6.97 per diluted share.
Adjusted net earnings was $1.543 billion, or $5.36 per diluted
share. This compares to third quarter 2020 net loss of $234
million, or $1.06 per diluted share. Adjusted net loss for third
quarter 2020 was $268 million, or $1.21 per diluted share.
Earnings Highlights
Three Months Ended
Nine Months Ended
September 30,
September 30,
(Dollars in millions, except per share
amounts)
2021
2020
2021
2020
Net Sales
5,964
2,340
14,653
7,179
Segment earnings (loss) before interest
and income taxes
Flat-Rolled
$
1,015
$
(159
)
$
1,740
$
(523
)
Mini Mill (a)
424
—
840
—
U. S. Steel Europe
394
13
706
(27
)
Tubular (b)
—
(52
)
(29
)
(147
)
Other
(2
)
(13
)
20
(33
)
Total segment earnings (loss) before
interest and income taxes
$
1,831
$
(211
)
$
3,277
$
(730
)
Other items not allocated to segments
511
—
524
(388
)
Earnings (loss) before interest and
income taxes
$
2,342
$
(211
)
$
3,801
$
(1,118
)
Net interest and other financial
costs
80
47
472
144
Income tax expense (benefit)
260
(24
)
224
(48
)
Net earnings (loss)
$
2,002
$
(234
)
$
3,105
$
(1,214
)
Earnings (loss) per diluted
share
$
6.97
$
(1.06
)
$
11.13
$
(6.43
)
Adjusted net earnings (loss)
(c)
$
1,543
(268
)
$
2,790
(860
)
Adjusted net earnings (loss) per
diluted share (c)
$
5.36
$
(1.21
)
$
9.99
$
(4.56
)
Adjusted earnings (loss) before
interest, income taxes, depreciation and amortization (EBITDA)
(c)
$
2,027
$
(49
)
$
3,864
$
(249
)
(a) Mini Mill segment, added after January
15, 2021 with the purchase of the remaining equity interest in Big
River Steel, does not include the newly constructed electric arc
furnace (EAF) at our Fairfield Tubular Operations in Fairfield,
Alabama.
(b) The Fairfield EAF is included in the
Tubular segment.
(c) Please refer to the non-GAAP Financial
Measures section of this document for the reconciliation of these
amounts.
“We continue setting records, including record net earnings,
record EBITDA, record EBITDA margin, record liquidity, record
safety, and record quality and reliability,” said U. S. Steel
President and Chief Executive Officer David B. Burritt. “Our
balance sheet has been transformed and the cash flow generation of
the business has us highly confident in our ability to pre-fund
organic growth investments that will expand our existing
competitive advantages. We are getting to our Best for All℠ future
faster.”
Commenting on the Company’s strategy, Burritt continued, “It's
not either investing in our business or returning capital directly
to stockholders, it's both. Our future now includes a $300 million
stock repurchase program and $0.05/share quarterly dividend to
begin directly rewarding stockholders for the progress we have made
so far. We are confident in the long-term value our new, highly
capable mini mill will create as it further expands our competitive
advantage to produce sustainable and differentiated steel. We are
getting better, not bigger, by building on our Mini Mill segment's
industry-leading performance to create a business model that will
continue to reward stockholders into the future.”
*****
The Company will conduct a conference call on third quarter 2021
earnings on Friday, October 29, 2021 at 8:30 a.m. EDT. To listen to
the webcast of the conference call and to access the Company's
slide presentation, visit the U. S. Steel website, www.ussteel.com,
and click “Investors” then "Events & Presentations." Replays of
the conference call will be available on the website after 10:30
a.m. on October 29, 2021.
UNITED STATES STEEL
CORPORATION
PRELIMINARY SUPPLEMENTAL
STATISTICS (Unaudited)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2021
2020
2021
2020
OPERATING STATISTICS
Average realized price: ($/net ton unless
otherwise noted) (a)
Flat-Rolled
1,325
712
1,097
714
Mini Mill (b)
1,517
—
1,255
—
U. S. Steel Europe
1,143
608
932
616
U. S. Steel Europe (€/net ton)
969
520
779
548
Tubular
1,702
1,230
1,587
1,271
Steel shipments (thousands of net tons):
(a)
Flat-Rolled
2,328
2,155
6,986
6,454
Mini Mill (b)
608
—
1,671
—
U. S. Steel Europe
1,064
790
3,274
2,201
Tubular
123
71
317
390
Total Steel Shipments
4,123
3,016
12,248
9,045
Intersegment steel (unless otherwise
noted) shipments (thousands of net tons):
Flat-Rolled to Tubular
—
—
—
101
Flat-Rolled to USSE (iron ore pellets and
fines)
—
687
439
912
Mini Mill (b) to Flat-Rolled
114
—
300
—
Raw steel production (thousands of net
tons):
Flat-Rolled
2,634
2,207
7,700
6,823
Mini Mill (b)
750
—
2,007
—
U. S. Steel Europe
1,274
873
3,750
2,400
Tubular (c)
117
—
324
—
Raw steel capability utilization: (d)
Flat-Rolled
61
%
52
%
61
%
53
%
Mini Mill (b)
90
%
—
%
86
%
—
%
U. S. Steel Europe
101
%
69
%
100
%
64
%
Tubular
52
%
—
%
48
%
—
%
CAPITAL EXPENDITURES (dollars in
millions)
Flat-Rolled
105
81
272
391
Mini Mill (b)
46
—
102
—
U. S. Steel Europe
13
16
39
64
Tubular
12
39
46
133
Other Businesses
—
—
1
3
Total
$
176
$
136
$
460
$
591
(a) Excludes intersegment shipments.
(b) Mini Mill segment added after January
15, 2021 with the purchase of the remaining equity interest in Big
River Steel.
(c) Tubular segment raw steel added in
October 2020 with the start-up of the new electric arc furnace.
(d) Based on annual raw steel production
capability of 17.0 million net tons for Flat-Rolled, 3.3 million
for Mini Mill, 5.0 million net tons for U. S. Steel Europe and 0.9
million for Tubular.
UNITED STATES STEEL
CORPORATION
CONDENSED STATEMENT OF OPERATIONS
(Unaudited)
Three Months Ended
Nine Months Ended
September 30,
September 30,
(Dollars in millions, except per share
amounts)
2021
2020
2021
2020
NET SALES
5,964
2,340
14,653
7,179
OPERATING EXPENSES (INCOME):
Cost of sales
3,881
2,295
10,633
7,174
Selling, general and administrative
expenses
108
65
316
199
Depreciation, depletion and
amortization
196
162
587
481
(Earnings) loss from investees
(57
)
31
(106
)
78
Gain on sale of Transtar
(506
)
—
(506
)
—
Asset impairment charges
—
—
28
263
Gain on equity investee transactions
—
—
(111
)
(31
)
Restructuring and other charges
—
—
37
130
Net loss (gain) on sale of assets
7
(2
)
(8
)
(2
)
Other (gains) losses, net
(7
)
—
(18
)
5
Total operating expenses
3,622
2,551
10,852
8,297
EARNINGS (LOSS) BEFORE INTEREST AND INCOME
TAXES
2,342
(211
)
3,801
(1,118
)
Net interest and other financial costs
80
47
472
144
EARNINGS (LOSS) BEFORE INCOME TAXES
2,262
(258
)
3,329
(1,262
)
Income tax expense (benefit)
260
(24
)
224
(48
)
Net earnings (loss)
2,002
(234
)
3,105
(1,214
)
Net earnings attributable to
noncontrolling interests
—
—
—
—
NET EARNINGS (LOSS) ATTRIBUTABLE TO UNITED
STATES STEEL CORPORATION
$
2,002
$
(234
)
$
3,105
$
(1,214
)
COMMON STOCK DATA:
Net earnings (loss) per share attributable
to
United States Steel Corporation
stockholders:
Basic
$
7.41
$
(1.06
)
$
11.80
$
(6.43
)
Diluted
$
6.97
$
(1.06
)
$
11.13
$
(6.43
)
Weighted average shares, in thousands
Basic
270,175
220,402
263,209
188,766
Diluted
287,463
220,402
279,103
188,766
Dividends paid per common share
$
0.01
$
0.01
$
0.03
$
0.03
UNITED STATES STEEL
CORPORATION
CONDENSED CASH FLOW STATEMENT
(Unaudited)
Nine Months Ended
September 30,
(Dollars in millions)
2021
2020
Cash provided by (used in) operating
activities:
Net earnings (loss)
$
3,105
$
(1,214
)
Depreciation, depletion and
amortization
587
481
Gain on sale of Transtar
(506
)
—
Asset impairment charges
28
263
Gain on equity investee transactions
(111
)
(31
)
Restructuring and other charges
37
130
Loss on debt extinguishment
282
—
Pensions and other postretirement
benefits
(88
)
(18
)
Deferred income taxes
59
(36
)
Working capital changes
(852
)
210
Income taxes receivable/payable
137
13
Other operating activities
(73
)
53
Total
2,605
(149
)
Cash used in investing activities:
Capital expenditures
(460
)
(591
)
Acquisition of Big River Steel, net of
cash acquired
(625
)
—
Proceeds from the sale of Transtar
627
—
Investment in Big River Steel
—
(3
)
Proceeds from sale of assets
25
3
Proceeds from sale of ownership interests
in equity investees
—
8
Other investing activities
(3
)
(4
)
Total
(436
)
(587
)
Cash (used in) provided by financing
activities:
Issuance of short-term debt, net of
financing costs
—
240
Repayment of short-term debt
(180
)
—
Revolving credit facilities - borrowings,
net of financing costs
50
1,474
Revolving credit facilities -
repayments
(911
)
(1,633
)
Issuance of long-term debt, net of
financing costs
862
1,043
Repayment of long-term debt
(2,719
)
(8
)
Proceeds from public offering of common
stock
790
410
Proceeds from Stelco Option Agreement
—
55
Other financing activities
(12
)
(7
)
Total
(2,120
)
1,574
Effect of exchange rate changes on
cash
(15
)
10
Net increase in cash, cash equivalents and
restricted cash
34
848
Cash, cash equivalents and restricted cash
at beginning of the year
2,118
939
Cash, cash equivalents and restricted cash
at end of the period
$
2,152
$
1,787
UNITED STATES STEEL
CORPORATION
CONDENSED BALANCE SHEET
(Unaudited)
September 30,
December 31,
(Dollars in millions)
2021
2020
Cash and cash equivalents
$
2,044
$
1,985
Receivables, net
2,403
994
Inventories
2,086
1,402
Other current assets
266
51
Total current assets
6,799
4,432
Operating lease assets
198
214
Property, plant and equipment, net
7,380
5,444
Investments and long-term receivables,
net
628
1,177
Intangible assets, net
527
129
Goodwill
909
4
Other noncurrent assets
892
659
Total assets
$
17,333
$
12,059
Accounts payable and other accrued
liabilities
3,000
1,884
Payroll and benefits payable
542
308
Short-term debt and current maturities of
long-term debt
61
192
Other current liabilities
427
272
Total current liabilities
4,030
2,656
Noncurrent operating lease liabilities
148
163
Long-term debt, less unamortized discount
and debt issuance costs
4,272
4,695
Employee benefits
202
322
Other long-term liabilities
673
344
United States Steel Corporation
stockholders' equity
7,916
3,786
Noncontrolling interests
92
93
Total liabilities and stockholders'
equity
$
17,333
$
12,059
UNITED STATES STEEL
CORPORATION
NON-GAAP FINANCIAL MEASURES
RECONCILIATION OF ADJUSTED NET
EARNINGS (LOSS)
Three Months Ended
Nine Months Ended
September 30,
September 30,
(In millions of dollars)
2021
2020
2021
2020
Reconciliation to adjusted net earnings
(loss) attributable to United States Steel Corporation (a)
Net earnings (loss) attributable to United
States Steel Corporation
$
2,002
$
(234
)
$
3,105
$
(1,214
)
Debt extinguishment
23
—
278
—
Asset impairment
—
—
26
263
Big River Steel - inventory step-up
amortization
—
—
24
—
Big River Steel - unrealized (gains)
losses
(11
)
—
3
—
Big River Steel - acquisition costs
—
—
9
—
Restructuring and other charges
—
—
36
123
Loss on USSE assets held for sale
7
—
7
—
Gain on sale of Transtar
(453
)
—
(453
)
—
Gain on previously held investment in Big
River Steel
—
—
(111
)
—
Property sale
—
—
(14
)
—
Reversal of tax valuation allowance
(b)
(25
)
—
(120
)
—
Tubular inventory impairment
—
—
—
24
Uncertain tax positions
—
—
—
13
Gain on previously held investment in
UPI
—
—
—
(25
)
Big River Steel options and forward
adjustments
—
(34
)
—
(40
)
December 24, 2018 Clairton coke making
facility fire
—
—
—
(4
)
Total adjustments
(459
)
(34
)
(315
)
354
Adjusted net earnings (loss) attributable
to United States Steel Corporation
$
1,543
(268
)
$
2,790
(860
)
(a) The adjustments included in this table
for the three and nine months ended September 30, 2021, were tax
effected due to the partial reversals of the valuation allowance on
our domestic deferred tax assets that occurred in the second and
third quarters of 2021.
(b) The $25 million and $120 million
adjustments recorded in the three and nine months ended September
30, 2021, respectively, were related to partial reversals of the
tax valuation allowance recorded against the Company's net domestic
deferred tax asset as a result of the Company's three-year
cumulative income position and a change in the projections of
income in future years. There was an additional net benefit of $227
million and $394 million for the three and nine months ended
September 30, 2021, respectively, included in earnings related to
the reversals of the valuation allowance due to a change in
estimated current year earnings.
UNITED STATES STEEL
CORPORATION
NON-GAAP FINANCIAL MEASURES
RECONCILIATION OF ADJUSTED NET
EARNINGS (LOSS)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2021
2020
2021
2020
Reconciliation to adjusted diluted net
earnings (loss) per share (a)
Diluted net earnings (loss) per share
$
6.97
$
(1.06
)
$
11.13
$
(6.43
)
Debt extinguishment
0.08
—
1.00
—
Asset impairment
—
—
0.09
1.39
Big River Steel - inventory step-up
amortization
—
—
0.09
—
Big River Steel - unrealized (gains)
losses
(0.04
)
—
0.01
—
Big River Steel - acquisition costs
—
—
0.03
—
Restructuring and other charges
—
—
0.13
0.64
Loss on USSE assets held for sale
0.02
—
0.02
—
Gain on sale of Transtar
(1.57
)
—
(1.62
)
—
Gain on previously held investment in Big
River Steel
—
—
(0.40
)
—
Property sale
—
—
(0.05
)
—
Reversal of tax valuation allowance
(b)
(0.10
)
—
(0.44
)
—
Tubular inventory impairment
—
—
—
0.13
Uncertain tax positions
—
—
—
0.07
Gain on previously held investment in
UPI
—
—
—
(0.13
)
Big River Steel options and forward
adjustments
—
(0.15
)
—
(0.21
)
December 24, 2018 Clairton coke making
facility fire
—
—
—
(0.02
)
Total adjustments
(1.61
)
(0.15
)
(1.14
)
1.87
Adjusted diluted net earnings (loss) per
share
$
5.36
$
(1.21
)
$
9.99
$
(4.56
)
(a) The adjustments included in this table
for the three and nine months ended September 30, 2021, were tax
effected due to the partial reversals of the valuation allowance on
our domestic deferred tax assets that occurred in the second and
third quarters of 2021.
(b) The $0.10 and $0.44 adjustments per
diluted share recorded in the three and nine months ended September
30, 2021, respectively, were related to partial reversals of the
tax valuation allowance recorded against the Company's net domestic
deferred tax asset as a result of the Company's three-year
cumulative income position and a change in the projections of
income in future years.
UNITED STATES STEEL
CORPORATION
NON-GAAP FINANCIAL MEASURES
RECONCILIATION OF ADJUSTED
EBITDA
Three Months Ended
Nine Months Ended
September 30,
September 30,
(Dollars in millions)
2021
2020
2021
2020
Reconciliation to Adjusted EBITDA
Net earnings (loss) attributable to United
States Steel Corporation
$
2,002
$
(234
)
$
3,105
$
(1,214
)
Income tax expense (benefit)
260
(24
)
224
(48
)
Net interest and other financial costs
80
47
472
144
Depreciation, depletion and amortization
expense
196
162
587
481
EBITDA
2,538
(49
)
4,388
(637
)
Asset impairment
—
—
28
263
Big River Steel - inventory step-up
amortization
—
—
24
—
Big River Steel - unrealized (gains)
losses
(12
)
—
3
—
Big River Steel - acquisition costs
—
—
9
—
Restructuring and other charges
—
—
37
130
Loss on USSE assets held for sale
7
—
7
—
Gain on sale of Transtar
(506
)
—
(506
)
—
Gain on previously held investment in Big
River Steel
—
—
(111
)
—
Property sale
—
—
(15
)
—
Tubular inventory impairment
—
—
—
24
Gain on previously held investment in
UPI
—
—
—
(25
)
December 24, 2018 Clairton coke making
facility fire
—
—
—
(4
)
Adjusted EBITDA
$
2,027
$
(49
)
$
3,864
$
(249
)
We present adjusted net earnings (loss), adjusted net earnings
(loss) per diluted share, earnings (loss) before interest, income
taxes, depreciation and amortization (EBITDA) and adjusted EBITDA,
which are non-GAAP measures, as additional measurements to enhance
the understanding of our operating performance. We believe that
EBITDA, considered along with net earnings (loss), is a relevant
indicator of trends relating to our operating performance and
provides management and investors with additional information for
comparison of our operating results to the operating results of
other companies.
Adjusted net earnings (loss) and adjusted net earnings (loss)
per diluted share are non-GAAP measures that exclude the effects of
items that include: debt extinguishment, asset impairment, Big
River Steel - inventory step-up amortization, Big River Steel -
unrealized (gains) losses, Big River Steel - acquisition costs,
restructuring and other charges, loss on USSE assets held for sale,
gain on sale of Transtar, gain on previously held investment in Big
River Steel, property sale, reversal of tax valuation allowance,
Tubular inventory impairment, uncertain tax positions, gain on
previously held investment in UPI, Big River Steel options and
forward adjustments and December 24, 2018 Clairton coke making
facility fire (Adjustment Items). Adjusted EBITDA is also a
non-GAAP measure that excludes the effects of certain Adjustment
Items. We present adjusted net earnings (loss), adjusted net
earnings (loss) per diluted share and adjusted EBITDA to enhance
the understanding of our ongoing operating performance and
established trends affecting our core operations by excluding the
effects of events that can obscure underlying trends. U. S. Steel's
management considers adjusted net earnings (loss), adjusted net
earnings (loss) per diluted share and adjusted EBITDA as
alternative measures of operating performance and not alternative
measures of the Company's liquidity. U. S. Steel’s management
considers adjusted net earnings (loss), adjusted net earnings
(loss) per diluted share and adjusted EBITDA useful to investors by
facilitating a comparison of our operating performance to the
operating performance of our competitors. Additionally, the
presentation of adjusted net earnings (loss), adjusted net earnings
(loss) per diluted share and adjusted EBITDA provides insight into
management’s view and assessment of the Company’s ongoing operating
performance because management does not consider the adjusting
items when evaluating the Company’s financial performance. Adjusted
net earnings (loss), adjusted net earnings (loss) per diluted share
and adjusted EBITDA should not be considered a substitute for net
earnings (loss), earnings (loss) per diluted share or other
financial measures as computed in accordance with U.S. GAAP and is
not necessarily comparable to similarly titled measures used by
other companies. A condensed consolidated statement of operations
(unaudited), condensed consolidated cash flow statement
(unaudited), condensed consolidated balance sheet (unaudited) and
preliminary supplemental statistics (unaudited) for U. S. Steel are
attached.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING
STATEMENTS
This release contains information that may constitute
“forward-looking statements” within the meaning of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. We intend the
forward-looking statements to be covered by the safe harbor
provisions for forward-looking statements in those sections.
Generally, we have identified such forward-looking statements by
using the words “believe,” “expect,” “intend,” “estimate,”
“anticipate,” “project,” “target,” “forecast,” “aim,” “should,”
“will,” "may" and similar expressions or by using future dates in
connection with any discussion of, among other things, financial
performance, the construction or operation of new and existing
facilities, operating performance, trends, events or developments
that we expect or anticipate will occur in the future, statements
relating to volume changes, share of sales and earnings per share
changes, anticipated cost savings, potential capital and
operational cash improvements, changes in global supply and demand
conditions and prices for our products, international trade duties
and other aspects of international trade policy, the integration of
Big River Steel in our existing business, business strategies
related to the combined business and statements expressing general
views about future operating results. However, the absence of these
words or similar expressions does not mean that a statement is not
forward-looking. Forward-looking statements are not historical
facts, but instead represent only the Company’s beliefs regarding
future events, many of which, by their nature, are inherently
uncertain and outside of the Company’s control. It is possible that
the Company’s actual results and financial condition may differ,
possibly materially, from the anticipated results and financial
condition indicated in these forward-looking statements. Management
believes that these forward-looking statements are reasonable as of
the time made. However, caution should be taken not to place undue
reliance on any such forward-looking statements because such
statements speak only as of the date when made. Our Company
undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise, except as required by law. In addition,
forward-looking statements are subject to certain risks and
uncertainties that could cause actual results to differ materially
from our Company's historical experience and our present
expectations or projections. These risks and uncertainties include,
but are not limited to, the risks and uncertainties described in
this report and in “Item 1A. Risk Factors” in our Annual Report on
Form 10-K for the year ended December 31, 2020 and those described
from time to time in our future reports filed with the Securities
and Exchange Commission.
References to "we," "us," "our," the "Company," and "U. S.
Steel," refer to United States Steel Corporation and its
consolidated subsidiaries, references to “Big River Steel” refer to
Big River Steel Holdings LLC and its direct and indirect
subsidiaries unless otherwise indicated by the context, and
“Transtar” refers to Transtar LLC and its direct and indirect
subsidiaries unless otherwise indicated by the context.
###
Founded in 1901, United States Steel Corporation is a leading
steel producer. With an unwavering focus on safety, the company’s
customer-centric Best for All℠ strategy is advancing a more secure,
sustainable future for U. S. Steel and its stakeholders. With a
renewed emphasis on innovation, U. S. Steel serves the automotive,
construction, appliance, energy, containers, and packaging
industries with high value-added steel products such as U. S.
Steel’s proprietary XG3™ advanced high-strength steel. The company
also maintains competitively advantaged iron ore production and has
an annual raw steelmaking capability of 26.2 million net tons. U.
S. Steel is headquartered in Pittsburgh, Pennsylvania, with
world-class operations across the United States and in Central
Europe. For more information, please visit www.ussteel.com.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20211028006155/en/
John Ambler Vice President Corporate Communications T - (412)
433-2407 E - joambler@uss.com
Kevin Lewis Vice President Investor Relations T - (412) 433-6935
E - klewis@uss.com
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