United States Steel Corporation (NYSE: X) today provided first
quarter 2023 guidance on adjusted EBITDA of approximately $375
million. First quarter 2023 adjusted net earnings per diluted share
is expected to be in the range of $0.58 to $0.63.
“Momentum continues to build in the North American flat-rolled
market,” commented U. S. Steel President and Chief Executive
Officer David B. Burritt. “Strong safety and operating performance,
improving order entry and our continued focus on winning share in
strategic markets are resulting in better than expected first
quarter guidance. We expect these trends to continue into the
second quarter given extending lead times and the flow-through of
higher selling prices.”
Burritt continued, “We are increasingly more bullish for 2023
performance. Our Flat-rolled segment order book reflects
wide-ranging demand improvement. Our Mini Mill segment’s order book
is also improving and its cost structure continues to normalize, as
anticipated, by absorbing higher priced metallics purchased at the
onset of the Ukraine war. In Europe, demand has improved and
coupled with our focus on continuous improvement, we saw positive
EBITDA return in February. In Tubular, we expect another quarter of
improving EBITDA performance as seamless pipe prices and order
entry remains healthy in the first quarter.”
Burritt concluded, “Our high return strategic projects remain
on-time and on-budget. The Gary pig iron project is already
contributing to the Mini Mill segment’s normalizing cost structure
and the Big River Steel non-grain oriented electrical steel line is
expected to be commissioned this summer. Our balance sheet
strength, strategic investments with returns that significantly
exceed our cost of capital and continued direct returns to
stockholders are creating stockholder value, today and
tomorrow.”
Stockholder Returns Update
The Company expects to complete approximately $75 million of
repurchases of common stock in the first quarter under its existing
$500 million stock buyback authorization. By quarter end, the
Company expects to have repurchased approximately 15% of its
diluted shares outstanding since the beginning of December 2021,
which equates to approximately $1.1 billion returned directly to
stockholders.
First Quarter Adjusted EBITDA Commentary
The Flat-rolled segment’s adjusted EBITDA is expected to be
lower than the fourth quarter. This is due in part to the typical
seasonal mining operations headwinds experienced every first
quarter. The commercial drivers are increasingly reflecting the
improving demand and rising price environment. As a result, the
Company restarted Gary Works blast furnace #8 in early March. The
segment’s order book reflects broad improvements across most
end-markets.
The Mini Mill segment is expected to return to positive EBITDA
in the first quarter. Metallics costs in the back half of the
quarter are normalizing, contributing to the sequential improvement
and positive EBITDA performance quarter-to-date. Additionally,
rising steel prices are expected to contribute to EBITDA for the
quarter.
The European segment’s adjusted EBITDA is expected to be
negative but better than noted in the outlook commentary provided
on the February earnings call. The segment returned to positive
EBITDA in February and is expected to deliver positive EBITDA in
March. Market prices are improving, reflecting increased demand and
lower import activity. Additionally, the warmer winter has reduced
energy costs in the region, creating an additional tailwind to the
segment’s expected first quarter performance.
The Tubular segment is expected to deliver its tenth quarter of
consecutive EBITDA increases, in large part due to healthy customer
demand, a strong value added product mix and increased average
selling prices in the first quarter. The strategic investment in
the electric arc furnace completed in 2020 has structurally
improved the segment’s operating performance.
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, the construction or operation of new or existing
facilities and operating capabilities, the timing, size and form of
share repurchase transactions, operating or financial 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 the
global economic environment, including supply and demand
conditions, inflation, interest rates, supply chain disruptions and
changes in 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, statements
regarding existing or new regulations 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, 2022 and those
described from time to time in our future reports filed with the
Securities and Exchange Commission.
References to "U. S. Steel," "the Company," "we," "us," and
"our" 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.
UNITED STATES STEEL
CORPORATION
NON-GAAP FINANCIAL MEASURES
RECONCILIATION OF ADJUSTED EBITDA
GUIDANCE
(Dollars in millions)
Reconciliation to Projected Adjusted
EBITDA Included in Guidance
Q1 2023
Projected net earnings attributable to
United States Steel Corporation included in guidance
$
155
Estimated income tax provision
35
Estimated net interest and other financial
costs (income)
(35
)
Estimated depreciation, depletion, and
amortization
220
Projected EBITDA included in guidance
$
375
Estimated adjustments
-
Projected adjusted EBITDA included in
guidance
$
375
UNITED STATES STEEL
CORPORATION
NON-GAAP FINANCIAL MEASURES
RECONCILIATION OF ADJUSTED NET
EARNINGS GUIDANCE
(Dollars in millions, except per share
amounts)
Reconciliation to Projected Adjusted
Net Earnings Attributable to U. S. Steel Included in
Guidance
Q1 2023
Projected net earnings attributable to
United States Steel Corporation included in guidance
$
155
Estimated adjustments
-
Projected adjusted net earnings
attributable to United States Steel Corporation included in
guidance $
155
Reconciliation to Projected Adjusted
Net Earnings Per Diluted Share Included in Guidance
Q1 2023
Projected net earnings per diluted share
included in guidance (mid-point of guidance)
$
0.61
Estimated adjustments
-
Projected adjusted net earnings per
diluted share included in guidance (mid-point of guidance)
$
0.61
Note: Excludes the impact of the Company's quarterly adjustment
related to the surplus VEBA assets. See Note 18 in the Company's
Annual Report on Form 10-K for the year ended December 31, 2022 for
an explanation of the surplus VEBA assets. This item will not
impact adjusted EBITDA, adjusted net earnings or adjusted net
earnings per diluted share.
Note Regarding Non-GAAP Financial Measures
We present adjusted net earnings, adjusted net earnings per
diluted share, earnings 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, 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, adjusted net earnings per diluted share
and adjusted EBITDA are non-GAAP measures that exclude certain
charges that are not part of the Company’s core operations such as
restructuring or asset impairments (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 and believes these
measures are 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 Adjustment 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 are
not necessarily comparable to similarly titled measures used by
other companies.
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.
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version on businesswire.com: https://www.businesswire.com/news/home/20230316005474/en/
Arista E. Joyner Manager Financial Communications T – (412)
433-3994 E – aejoyner@uss.com
Kevin Lewis Vice President Finance T – (412) 433-6935 E –
klewis@uss.com
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