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U.S. Steel posts $73M loss in 1st quarter

Keywords: Tags  U.S. Steel, first quarter earnings report, John Surma, flat-rolled, tubular, Thorsten Schier

NEW YORK — U.S. Steel Corp. posted a $73-million net loss in the first quarter as improved results by its tubular and European segments were offset by a weaker performance in the company’s flat-rolled segment.

"Lead times throughout the first quarter of 2013 remained short and afforded buyers the opportunity to limit their order book exposure, preventing upward movement in spot market prices," the company said April 30.

The first-quarter loss was down 66.7 percent from a $219-million loss in the same period last year but 46 percent higher than a $50-million loss posted in the fourth quarter of 2012.

First-quarter net sales totaled $4.6 billion, down 11.2 percent from more than $5.17 billion a year earlier but up 2.4 percent from nearly $4.49 billion in the fourth quarter.

Shipments by the company’s tubular segment rose during the first quarter as "distributors began replenishing inventory," the company said, although "prices were lower due to the available supply of tubular products and decreased drilling activity."

The Pittsburgh-based steelmaker’s European segment saw an uptick in first-quarter shipments, particularly for value-added products, as European service centers and distributors restocked.

U.S. Steel expects "comparable" results for its tubular segment during the second quarter, while results for the flat-rolled and European segments are expected to decline, chairman and chief executive officer John P. Surma said in a statement.

The flat-rolled segment is expected to see higher operating costs in a market environment "comparable to the first quarter," while shipments by the company’s tubular segment are expected to increase due to a "higher level of drilling activity," Surma said. European results are expected to decline due to higher raw material costs, "primarily iron ore."

U.S. Steel shipments totaled more than 5.49 million tons in the first quarter, down 3 percent from nearly 5.67 million tons a year earlier but up 4.9 percent from 5.24 million in the fourth quarter of 2012.

Realized prices by the company’s flat-rolled segment averaged $719 per ton in the first quarter, down 5.9 percent from $764 a year earlier, while average tubular prices fell 9.9 percent to $1,556 per ton from $1,727 in the same comparison.

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