EXPECTING TO DELIVER RECORD SECOND QUARTER
PERFORMANCE
- Record first quarter net earnings of $882 million, or $3.02
per diluted share
- Record first quarter adjusted net earnings of $891 million,
or $3.05 per diluted share
- Record first quarter adjusted EBITDA of $1.337
billion
United States Steel Corporation (NYSE: X) reported first quarter
2022 net earnings of $882 million, or $3.02 per diluted share.
Adjusted net earnings was $891 million, or $3.05 per diluted share.
This compares to first quarter 2021 net earnings of $91 million, or
$0.35 per diluted share. Adjusted net earnings for the first
quarter 2021 was $283 million, or $1.08 per diluted share.
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United States Steel Corporation Reports
Record First Quarter 2022 Results (Graphic: Business Wire)
Earnings Highlights
Three Months Ended
March 31,
(Dollars in millions, except per share
amounts)
2022
2021
Net Sales
$
5,234
$
3,664
Segment earnings (loss) before interest
and income taxes
Flat-Rolled
$
513
$
146
Mini Mill (a)
278
132
U. S. Steel Europe
264
105
Tubular (b)
77
(29
)
Other
7
8
Total segment earnings before interest
and income taxes
$
1,139
$
362
Other items not allocated to segments
(21
)
63
Earnings before interest and income
taxes
$
1,118
$
425
Net interest and other financial
costs
(10
)
333
Income tax expense
246
1
Net earnings
$
882
$
91
Earnings per diluted share
$
3.02
$
0.35
Adjusted net earnings (c)
$
891
$
283
Adjusted net earnings per diluted share
(c)
$
3.05
$
1.08
Adjusted earnings before interest,
income taxes, depreciation and amortization (EBITDA) (c)
$
1,337
$
551
(a) Mini Mill segment added after January
15, 2021 with the purchase of the remaining equity interest in Big
River Steel.
(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.
“It was another quarter of records at U. S. Steel with the
continued demonstration of the power of our Best for All®
strategy,” commented U. S. Steel President and Chief Executive
Officer David B. Burritt. “Another all-time best quarter of safety
and continued operational excellence supported adjusted net income
of nearly $900 million, adjusted EBITDA of over $1.3 billion,
adjusted EBITDA margins of 26% and adjusted earnings per diluted
share of $3.05. The team’s stellar performance drove our best ever
first quarter results, despite the challenging global dynamics that
emerged throughout the quarter. Our Mini Mill segment delivered 38%
EBITDA margins, outperforming both mini mill and integrated peers.
We also generated free cash flow of over $400 million which enables
the opportunity to meaningfully increase our direct returns to
stockholders in the second quarter. We continue to prove that our
strategy is indeed Best for All ... best for our customers, best
for our colleagues, best for our stockholders, and best for the
communities where we live and work.”
Burritt continued, “We currently expect the second quarter to be
the company’s all-time best second quarter as our balanced customer
portfolio, raw materials integration and operating leverage is
expected to expand adjusted EBITDA and support another quarter of
strong EBITDA margin and cash generation. With each quarter of
record performance and continued on-time and on-budget progress on
our strategic investments, we believe U. S. Steel is well
positioned to earn a significantly higher multiple as we
demonstrate improved earnings performance, higher free cash flow,
increasing direct returns to stockholders and outstanding
leadership in innovation and research and development.”
Commenting on the company’s Best for All strategy, Burritt
concluded, “Today’s geopolitical uncertainty and elevated raw
material cost environment reinforces to customers the importance of
steel that is mined, melted and made in the U.S.A. Our iron ore
mines are a unique competitive advantage that cannot be easily
replicated by other competitors. Additionally, we continue to
progress on our sustainability goals and deliver the 'green'
products our customers are increasingly demanding. We are also
demonstrating our ESG leadership. Earlier this year, Big River
Steel became the first North American steel facility certified by
ResponsibleSteel™. This is independent affirmation of our
commitment to ESG excellence and sustainable processes and
products. We will not stand still and remain bullish because our
stakeholders know that for us to be Best for All we need best from
all.”
The company will conduct a conference call on the first quarter
2022 earnings on Friday, April 29, 2022, at 8:30 a.m. Eastern. 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 on the “Investors” section. Replay will
be available on the website after 10:30 a.m. on April 29, 2022.
UNITED STATES STEEL
CORPORATION
PRELIMINARY SUPPLEMENTAL
STATISTICS (Unaudited)
Three Months Ended
March 31,
2022
2021
OPERATING STATISTICS
Average realized price: ($/net ton unless
otherwise noted) (a)
Flat-Rolled
1,368
888
Mini Mill (b)
1,372
967
U. S. Steel Europe
1,109
748
U. S. Steel Europe (€/net ton)
988
620
Tubular
2,349
1,372
Steel shipments (thousands of net tons):
(a)
Flat-Rolled
1,947
2,332
Mini Mill (b)
507
447
U. S. Steel Europe
1,110
1,043
Tubular
128
89
Total Steel Shipments
3,692
3,911
Intersegment steel (unless otherwise
noted) shipments (thousands of net tons):
Flat-Rolled to USSE (iron ore pellets and
fines)
—
216
Mini Mill (b) to Flat-Rolled
89
61
Raw steel production (thousands of net
tons):
Flat-Rolled
2,205
2,581
Mini Mill (b)
601
510
U. S. Steel Europe
1,088
1,197
Tubular
156
93
Raw steel capability utilization: (c)
Flat-Rolled
68
%
62
%
Mini Mill (b)
74
%
75
%
U. S. Steel Europe
88
%
97
%
Tubular
70
%
42
%
CAPITAL EXPENDITURES (dollars in
millions)
Flat-Rolled
117
74
Mini Mill (b)
211
36
U. S. Steel Europe
17
14
Tubular
4
12
Other Businesses
—
—
Total
$
349
$
136
(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) 2022 based on annual raw steel
production capability of 13.2 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. 2021 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
March 31,
(Dollars in millions, except per share
amounts)
2022
2021
Net Sales
5,234
3,664
Operating expenses (income):
Cost of sales
3,823
3,074
Selling, general and administrative
expenses
117
102
Depreciation, depletion and
amortization
198
189
Earnings from investees
(36
)
(14
)
Gain on equity investee transactions
—
(111
)
Restructuring and other charges
17
6
Net gains on sale of assets
(2
)
—
Other gains, net
(1
)
(7
)
Total operating expenses
4,116
3,239
Earnings before interest and income
taxes
1,118
425
Net interest and other financial
(benefits) costs
(10
)
333
Earnings before income taxes
1,128
92
Income tax expense
246
1
Net earnings
882
91
Less: Net earnings attributable to
noncontrolling interests
—
—
Net earnings attributable to United
States Steel Corporation
$
882
$
91
COMMON STOCK DATA:
Net earnings per share attributable to
United States Steel Corporation
Basic
$
3.37
$
0.36
Diluted
$
3.02
$
0.35
Weighted average shares, in thousands
Basic
261,453
249,351
Diluted
293,267
261,969
Dividends paid per common share
$
0.05
$
0.01
UNITED STATES STEEL
CORPORATION
CONDENSED CASH FLOW STATEMENT
(Unaudited)
Three Months Ended
March 31,
(Dollars in millions)
2022
2021
Increase (decrease) in cash, cash
equivalents and restricted cash
Operating activities:
Net earnings
$
882
$
91
Depreciation, depletion and
amortization
198
189
Gain on equity investee transactions
—
(111
)
Restructuring and other charges
17
6
Loss on debt extinguishment
—
255
Pensions and other postretirement
benefits
(60
)
(25
)
Deferred income taxes
121
3
Working capital changes
(462
)
(274
)
Income taxes receivable/payable
140
3
Other operating activities
(65
)
(26
)
Net cash provided by operating
activities
771
111
Investing activities:
Capital expenditures
(349
)
(136
)
Acquisition of Big River Steel, net of
cash acquired
—
(625
)
Proceeds from sale of assets
4
—
Other investing activities
(7
)
(1
)
Net cash used in investing activities
(352
)
(762
)
Financing activities:
Repayment of short-term debt
—
(180
)
Revolving credit facilities - borrowings,
net of financing costs
—
50
Revolving credit facilities -
repayments
—
(671
)
Issuance of long-term debt, net of
financing costs
4
826
Repayment of long-term debt
(6
)
(1,379
)
Proceeds from public offering of common
stock
—
791
Common stock repurchased
(123
)
—
Proceeds from government incentives
82
—
Other financing activities
(28
)
(10
)
Net cash used in financing activities
(71
)
(573
)
Effect of exchange rate changes on
cash
(7
)
(12
)
Net increase (decrease) in cash, cash
equivalents and restricted cash
341
(1,236
)
Cash, cash equivalents and restricted cash
at beginning of year
2,600
2,118
Cash, cash equivalents and restricted cash
at end of period
$
2,941
$
882
UNITED STATES STEEL
CORPORATION
CONDENSED BALANCE SHEET
(Unaudited)
March 31,
December 31,
(Dollars in millions)
2022
2021
Cash and cash equivalents
$
2,866
$
2,522
Receivables, net
2,415
2,089
Inventories
2,663
2,210
Other current assets
436
331
Total current assets
8,380
7,152
Operating lease assets
174
185
Property, plant and equipment, net
7,416
7,254
Investments and long-term receivables,
net
727
694
Intangible, net
509
519
Goodwill
920
920
Other noncurrent assets
1,098
1,092
Total assets
$
19,224
$
17,816
Accounts payable and other accrued
liabilities
3,343
2,908
Payroll and benefits payable
407
425
Short-term debt and current maturities of
long-term debt
60
28
Other current liabilities
595
491
Total current liabilities
4,405
3,852
Noncurrent operating lease liabilities
127
136
Long-term debt, less unamortized discount
and debt issuance costs
3,917
3,863
Employee benefits
195
235
Other long-term liabilities
789
627
United States Steel Corporation
stockholders' equity
9,698
9,010
Noncontrolling interests
93
93
Total liabilities and stockholders'
equity
$
19,224
$
17,816
UNITED STATES STEEL
CORPORATION
NON-GAAP FINANCIAL MEASURES
RECONCILIATION OF ADJUSTED NET
EARNINGS
(In millions of dollars)
Three Months Ended March 31,
2022
Three Months Ended March 31,
2021
Net earnings and diluted net earnings per
share attributable to United States Steel Corporation, as
reported
$
882
$
3.02
$
91
$
0.35
Restructuring and other charges
17
6
Other charges, net
4
42
Gains on asset sold and previously held
investments
—
(111
)
Debt extinguishment
—
255
Adjusted pre-tax net earnings to United
States Steel Corporation
$
903
$
283
Tax impact of adjusted items
(5
)
—
Net reversal of tax valuation
allowance
(7
)
$
—
Adjusted net earnings and diluted net
earnings per share attributable to United States Steel Corporation
(a)
$
891
$
3.05
$
283
$
1.08
Weight average diluted ordinary shares
outstanding, in millions
293.3
262.0
(a) Diluted net earnings per share were
adjusted by increasing adjusted net earnings by $3 million in the
first quarter of 2022, after the adoption of ASU 2020-06 which
assumes outstanding convertible shares are converted at the
beginning of the period.
UNITED STATES STEEL
CORPORATION
NON-GAAP FINANCIAL MEASURES
RECONCILIATION OF ADJUSTED
EBITDA
Three Months Ended
March 31,
(Dollars in millions)
2022
2021
Reconciliation to Adjusted EBITDA
Net earnings attributable to United States
Steel Corporation
$
882
$
91
Income tax expense
246
1
Net interest and other financial
(benefits) costs
(10
)
333
Depreciation, depletion and amortization
expense
198
189
EBITDA
1,316
614
Restructuring and other charges
17
6
Other charges, net
4
42
Gains on asset sold and previously held
investments
—
(111
)
Adjusted EBITDA
$
1,337
$
551
UNITED STATES STEEL
CORPORATION
NON-GAAP FINANCIAL MEASURES
RECONCILIATION OF FREE CASH
FLOW
Three Months Ended
(Dollars in millions)
March 31, 2022
Net cash provided by operating
activities
$
771
Net cash used in investing activities
(352
)
Cash used in Dividends paid
(13
)
Free Cash Flow
$
406
We present adjusted net earnings, adjusted net earnings per
diluted share, earnings before interest, income taxes, depreciation
and amortization (EBITDA), adjusted EBITDA and free cash flow,
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, 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 and adjusted net earnings per diluted
share are non-GAAP measures that exclude the effects of items that
include: restructuring and other charges, gains on asset sold and
previously held investments, debt extinguishment, tax impact of
adjusted items, net reversal of tax valuation allowance and other
charges, net (Adjustment Items). Adjusted EBITDA is also a non-GAAP
measure that excludes the effects of certain Adjustment Items. We
present adjusted net earnings, adjusted net earnings 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, adjusted net earnings 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, adjusted net earnings
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, adjusted net earnings 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, adjusted net earnings per diluted share and adjusted
EBITDA should not be considered a substitute for net earnings,
earnings 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. Free cash flow
is a measure of cash generated from operations, after any investing
activity and dividends paid to stockholders. We believe that free
cash flow provides further insight into the Company's overall
utilization of cash. 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,”
“plan,” “goal,” “future,” “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, anticipated disruptions
to our operations and industry due to the COVD-19 pandemic, changes
in global supply and demand conditions and prices for our products,
international trade duties and other aspects of international trade
policy, statements regarding our future strategies, products and
innovations, statements regarding our greenhouse gas emissions
reduction goals 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
“Item 1A. Risk Factors” in our Annual report on Form 10-K for the
year ended December 31, 2021 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 and references to “Big River Steel” refer
to Big River Steel Holdings 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 22.4 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.
©2022 U. S. Steel. All Rights Reserved
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220428006173/en/
Arista Joyner Manager Corporate Communications T - (412)
433-3994 E - aejoyner@uss.com
Kevin Lewis Vice President Investor Relations T - (412) 433-6935
E - klewis@uss.com
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