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AK Steel posts ninth straight loss in 3d qtr. amid outage

Keywords: Tags  AK Steel, Middletown Works outage, automotive, quarterly earnings, quarterly loss, steel shipments, Catherine Ngai

NEW YORK — Effects from an unplanned outage at AK Steel Corp.’s Middletown, Ohio, blast furnace, coupled with a seasonal decrease in shipments to the automotive sector, led the company to report a $31.7-million net loss for the third quarter.

While this marked the company’s ninth consecutive quarterly loss, it narrowed from a $60.9-million net loss in the same period a year ago and $40.4-million loss in the second quarter.

The West Chester, Ohio-based company reported sales of $1.33 billion on shipments of 1.24 million tons for the three months ended Sept. 30, down from sales of $1.46 billion on shipments of 1.36 million tons in the same year-ago period and sales of $1.4 billion on shipments of 1.32 million tons in the second quarter of 2013.

Average sales prices fell slightly year on year but rose 1 percent from the prior quarter, the steelmaker said Oct. 22.

"The average selling price for the third quarter of 2013 improved over the prior quarter due to a more favorable mix of value-added products, the benefit of which was largely offset by lower raw material surcharges and the effect of delayed shipments to customers resulting from the unplanned outage (at Middletown)," AK said.

The company also continued to honor lower-priced orders placed prior to its unplanned outage in Middletown for carbon spot market shipments, and "as a result of the limitations on its capacity for shipments caused by the outage" was unable to "realize the full benefit" of several price increases that occurred during the third quarter, it said.

The results also include pretax losses for the unplanned outage, after partial insurance recoveries, of $11.8 million for the third quarter and $18 million for the first nine months of the year.

AK also continued to experience a decline in electrical steel spot market pricing during the quarter, particularly in its international sales due to weak global economic conditions.

The company said its financial results for the fourth quarter will depend on whether it can reach an agreement with the insurance underwriters concerning the outage, but added that it expects improved results compared with the third quarter.

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