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Apr-22-2008Higher sales, prices give AK Steel healthy 1Q(topic overview)
CONTENTS:
- Looking ahead, AK Steel said it expects shipments in the second quarter to be 8 percent higher at approximately 1.7 million tons, with selling prices approximately $100 per ton higher than in the first quarter. (More...)
- The quarter included a $15.1 million pre-tax, non-cash charge on pensions, the company said. (More...)
- Second-quarter shipments are expected to hit about 1.7 million tons, up 8 percent form the first quarter. (More...)
- The increase in selling prices resulted from higher spot and contract steel prices, coupled with increased raw material surcharges, AK officials said. (More...)
- AKS is currently trading at $68.43, up $0.53 or 0.78%, on a volume of 188 thousand shares. (More...)
- Lehman Brothers analyst Dana Guido said the industry's price increases expected for the second quarter may not stick through the second half of the year, especially because of weakness in the U.S. economy. (More...)
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Looking ahead, AK Steel said it expects shipments in the second quarter to be 8 percent higher at approximately 1.7 million tons, with selling prices approximately $100 per ton higher than in the first quarter. The company also expects planned maintenance costs to be approximately $40 million higher in the second quarter, primarily the result of a nearly three-week planned blast furnace maintenance outage at its Middletown Works. [1] The company expects second-quarter shipments of about 1.7 million tons, up about 8 percent from the first three months. Planned maintenance costs will be about $40 million higher, primarily because of a nearly three-week planned blast furnace maintenance outage now under way at its Middletown Works. AK Steel shares have ranged from $27.71 to a record $69.62 in the past year, helped by rising global steel prices and resolution of its lockout, which resulted in beneficial labor contracts at its Middletown plant.[2]
Shipments in the quarter declined to 1.578 million tons from prior year shipments of 1.596 million tons. AK Steel said its average selling price for the first quarter of 2008 was $1,135 per ton, a 5% increase over the $1,078 per ton in the prior year quarter, helped by higher spot and contract steel prices, coupled with increased raw material surcharges.[3] Analysts on average were expecting 82 cents per share in earnings and revenue of $1.817 billion, according to Reuters Estimates. AK Steel said its average selling price for the first quarter was $1,135 per ton, a 5 percent increase over the $1,078 per ton in the first quarter of 2007.[1] Ahead of the report, analysts were expecting a profit of 82 cents per share on $1.78 billion in revenue. AKS noted that its average selling price during the first quarter hit a record $1,135 per ton, a 5% year-over-year increase.[4]
AK Steel was coming off a record fourth quarter, when it had all-time high shipments and revenues, and continued to benefit from rising steel prices. The company said its average selling price for the first quarter was a record $1,135 per ton, a 5 percent increase over the $1,078 per ton in the first quarter of 2007 and the $1,079 per ton in the fourth quarter.[2] Net sales in the first quarter of 2008 were $1,791.4 million on shipments of totaling 1,578,400 tons, compared to net sales of $1,719.9 million on shipments of 1,596,200 tons for the year-ago first quarter. The company said its average selling price for the first quarter of 2008 was a record $1,135 per ton, a 5 percent increase over both the $1,078 per ton in the first quarter of 2007 and the $1,079 per-ton level reached in the fourth quarter of 2007.[5] The company said it expects second-quarter shipments of about 1.7 million tons, up 8 percent over the first quarter, with the per-ton selling price rising by about $100. That should produce a record operating profit of about $125 per ton in the quarter.[6]
The company said it expects to generate record operating profit in the second quarter of 2008 of approximately $125 per ton. In a separate statement, AK Steel said its board of directors has declared a quarterly cash dividend of $0.05 per share of common stock, payable on June 10, 2008, to shareholders of record on May 16, 2008. AK Steel also said its Board has authorized the company to make an early $75 million contribution to its pension trust fund.[3] Operating profit for the first quarter of 2008 was $169.7 million, or $108 per ton, an increase of about 40% compared to the operating profit of $120.0 million, or $75 per ton, in the first quarter of 2007, which included the previously noted pension curtailment charge. "AK Steel is off to an excellent start in 2008 as we forge ahead on our plan to create more value for our shareholders," said James L. Wainscott, chairman, president and CEO. "We executed well during the first quarter, and our employees were again recognized for their excellence in safety, quality and productivity."[7] WEST CHESTER, Ohio, April 22 /PRNewswire-FirstCall/ -- AK Steel NYSE: AKS today reported net income of $101.1 million, or $0.90 per diluted share of common stock, for the first quarter of 2008, an increase of 60% compared to net income of $62.7 million, or $0.56 per diluted share for the first quarter of 2007, which included a $15.1 million pre-tax, non-cash pension curtailment charge.[7] WEST CHESTER TWP. -- AK Steel reported a net income of $101.1 million, or $0.90 per diluted share of common stock, for the first quarter of 2008, an increase of 60 percent over the same period last year.[5]
AK Steel Holding Corp.' s (AKS) first-quarter net income rose 61% to $101.1 million, or 90 cents a share, from $62.7 million, or 56 cents a share, a year earlier.[8] Financially, AK Steel looks strong: Longbow Research analyst Robert Richard says the company has negative net debt. Besides its big Middletown facility, AK Steel runs smaller plants in Zanesville, Mansfield and Coshocton, Ohio; Ashland, Ky.; Rockport, Ind., and Butler, Pa. That's up from the first-quarter of 2007, when the Cincinnati-area steel maker beat analysts' estimates by earning $62.7 million, or 56 cents a share, on record sales of $1.72 billion.[9] Analysts, on average, had expected earnings per share of 82 cents and net sales of $1.78 billion.[6] The steelmaker raked in net income of $101.1 million, or 90 cents per share, while sales rose to $1.79 billion.[4] The West Chester-based steel maker posted net income of $101 million, or 90 cents per share, compared to $62.7 million, or 56 cents per share, in first-quarter 2007.[6] The steel company reported net income of $101.1 million, or 90 cents a share, for the quarter ended March 31, compared with $62.7 million, or 56 cents a share, a year ago.[2] The West Chester-based steelmaker posted net income of $101.1 million, or 90 cents a share, compared with $62.7 million, or 56 cents a share, in the first 2007.[10]
Net earnings were $101.1 million, or 90 cents per share, compared with $62.7 million, or 56 cents per share, a year earlier, the Middletown, Ohio-based steelmaker said.[1] Among peers, Nucor Corp. (NUE), a provider of steel and steel products, reported first-quarter net earnings of $409.754 million or $1.41 per share, higher than $381.029 million or $1.26 per share a year ago.[3]
We executed well during the first quarter." The company's board underscored its better-than-expected quarter by announcing a quarterly cash dividend of 5 cents per share. It's unclear whether AKS is falling victim to widespread selling pressure in today's trading, or whether investors are reacting to the company's statement that it expects maintenance costs to increase by $40 million during the second quarter. Today's drop brought the shares back in touch with their 10-day moving average, and AKS has rebounded off its lows of the session.[4] On average, nine analysts polled by First Call/Thomson Financial expected the company to report $0.82 per share for the quarter.[3]
Operating profit for the first quarter increased about 40% to $169.7 million, or $108 per ton, from $120 million, or $75 per ton, in the first quarter of 2007, which included pension curtailment charge.The company expected to generate an operating profit in the first quarter of 2008 of about $100 per ton.[3] With a spike in per-ton selling prices, the company is projecting record operating profit of about $125 per ton in the quarter.[10] The company said it expects to generate record operating profit in the second quarter of 2008 of approximately $125 per ton.[7]
The company provided operating profit and shipment forecast for the second quarter. The West Chester, Ohio-based producer of flat-rolled carbon, stainless and electrical steels also said its board of directors has declared a quarterly cash dividend, and authorized an early $75 million contribution to its pension trust fund.[3]
Gains will be offset, however, by a $40 million spike in maintenance costs for a project at the company's Middletown Works. The company also said it will make an early $75 million contribution to its pension trust fund in the second quarter, fulfilling funding requirements for the year.[10] Maintenance costs also will rise by about $40 million, mainly due to a scheduled blast furnace maintenance project at the Middletown Works, the company said.[6]
Shares rose 36 cents to $68.26 at the open of trade Tuesday. AK Steel and the Machinists union ended the lockout at the Middletown Works with an agreement that gave the company more freedom in scheduling hourly workers, reduced the number of job classifications and required employees to pay a portion of their health care insurance costs.[2] Last month, a Middletown, Ohio, planning commission formally recommended that the southwest Ohio city rezone a 157-acre tract of land for a $340 million coke plant, to be built and owned by SunCoke of Knoxville, Tenn., and supply coke and electricity to AK Steel's Middletown Works. AK Steel Chief Executive James L. Wainscott said the deal "will cover our internal coke capacity shortfall, and provide Middletown's blast furnace with a stable, competitive supply of this essential raw material.[9] AK Steel makes flat-rolled carbon steel, stainless and electrical steel and carbon and stainless tubular products used in cars and appliances. Its headquarters are in West Chester, and its biggest plant is in Middletown, with smaller plants in Zanesville, Mansfield and Coshocton, Ohio; Ashland (nyse: ASH - news - people ), Ky.; Rockport, Ind.; and Butler, Pa.[2] The following is a summary of key developments and analyst opinion related to the period. OVERVIEW: Like many of its global peers, AK Steel is benefiting from soaring global steel prices. During the first three months of this year, the West Chester, Ohio, company, which makes flat-rolled carbon steel, stainless and electrical steel and carbon and stainless tubular products for cars and appliances, announced surcharges or price hikes nine times. Along with its domestic peers, the company has also benefited from the declining value of the U.S. dollar, especially as emerging market demand has grown and Asian supply growth has slowed. Unlike several U.S. rivals, AK Steel has an advantage in its internal supplies of iron ore, which offer it some protection from surging prices of the commodity.[9]
AK Steel (NYSE: AKS) said in a news release that the average selling price was up 5 percent in the first quarter, due to higher spot and contract prices, as well as raw material surcharges.[6] AK Steel says that higher selling prices have pushed its first quarter profits up by more than 60%.[1]
NEW YORK, April 22 (Reuters) - AK Steel Holding Corp (AKS.N: Quote, Profile, Research ) said on Tuesday that higher selling prices pushed first-quarter profit up more than 60 percent, easily beating Wall Steet's earnings estimates.[11] AK Steel Holding Corp. said Tuesday that its first-quarter profits beat Wall Street estimates, rising 60 percent from a year ago when the integrated steelmaker was in the final three months of a yearlong lockout at its main plant.[2]
AK Steel said it expects second-quarter operating profit of $125 a ton.[8] Operating profit rose about 40 percent to $169.7 million, or $108 per ton, compared to $120 million, or $75 per ton, a year ago.[10]
Average selling price is projected to be approximately $100 per ton higher than the first quarter of 2008.[3] The company expects second-quarter shipments of about 1.7 million tons at an average selling price of about $100 a ton higher than that of the first-quarter.[8] The company expected first-quarter shipments to be comparable to the fourth quarter of 2007 level, and 5%-6% sequential rise in average per-ton selling prices, partially offset by higher raw material costs.[3]
The company's first-quarter net sales increased to $1.79 billion from net sales of $1.72 billion in the year-ago first quarter, and came in above three Wall Street analysts' average estimate of $1.78 billion.[3] Net sales rose to $1.79 billion from $1.72 billion although shipments of 1.578 million tons were lower than the 1.596 million tons shipped in the 2007 first quarter.[1]
Net sales for the quarter climbed 13% to $4.974 billion from $3.768 billion last year. United States Steel Corp. (X) is slated to release its first-quarter results on April 29.[3] First-quarter net sales increased from net sales of $1.69 billion in the preceding fourth quarter.[3]
First-quarter sales also grew, climbing 4 percent to $1.79 billion from $1.72 billion.[10]
Sales totaled $1.79 billion, compared with $1.72 billion a year ago.[2]
Analysts expect earnings of $1.82 per share, on revenues of $5.09 billion.[3] On average, analysts polled by Thomson Reuters expected earnings of 82 cents a share on revenue of $1.78 billion.[8]
AK Steel ( AKS : sentiment, chart, options ) shares are mildly lower after the company reported first-quarter earnings that exceeded analysts' expectations.[4] STOCK PERFORMANCE: AK Steel shares rose 18 percent during the quarter to close at $54.42 on March 31.[9]
Looking ahead to the second quarter, AK Steel expects shipments to be approximately 1.7 million tons, an 8% increase over the first-quarter level.[3] AK Steel Holding Corp.' s first-quarter net income jumped 61%, as higher steel prices more than offset a dip in shipments.[12]
In 2007, the company earned a net income of $62.7 million, or $0.56 per diluted share. This included a $15.1 million pre-tax, non-cash pension curtailment charge, company officials said.[5] On a sequential basis, net income declined from net income of $106.7 million or $0.95 per share in the fourth quarter.[3]
The quarter included a $15.1 million pre-tax, non-cash charge on pensions, the company said. [10] First-quarter 2007 included a $15.1 million pre-tax, non-cash pension curtailment charge, the company said in a news release.[6]
According to the company, the contribution will result in more than $750 million in pension fund contributions since 2005.[3]
The company in 2007 recorded $387.7 million in profit on $7 billion in revenue.[10]
Second-quarter shipments are expected to hit about 1.7 million tons, up 8 percent form the first quarter. [10] NEW YORK -- Steel maker AK Steel Holding Corp. reports earnings for the first quarter on Tuesday.[9] "AK Steel is off to an excellent start in 2008 as we forge ahead on our plan to create more value for our shareholders," said James L. Wainscott, chairman, president and chief executive. "We executed well during the first quarter, and our employees were again recognized for their excellence in safety, quality and productivity."[2]
The increase in selling prices resulted from higher spot and contract steel prices, coupled with increased raw material surcharges, AK officials said. [5] One ongoing challenge for AK Steel is access to coke, which is made from coal and used in making steel. The company has to buy about 25 percent of its annual coke requirements on the open market, where prices are rising. That challenge may have been met.[9] Additional information about AK Steel is available on the company's web site at http://www.aksteel.com.[7]
AK Steel produces flat-rolled carbon, stainless and electrical steel products, as well as carbon and stainless tubular steel products.[6] AK Tube produces carbon and stainless electric resistance welded (ERW) tubular steel products for truck, automotive and other markets. Additional information about AK Tube LLC is available on its web site at http://www.aktube.com.[7]
AK Steel produces flat-rolled carbon, stainless and electrical steels, primarily for automotive, appliance, construction and electrical power generation and distribution markets.[7]
AK Tube LLC, a wholly owned subsidiary of AK Steel, employs about 300 men and women in plants in Walbridge, Ohio and Columbus, Indiana.[7]
AKS is currently trading at $68.43, up $0.53 or 0.78%, on a volume of 188 thousand shares. [3] Earnings in the year-ago period included a $15.1 million pretax, non-cash charge.[8] Results from a year ago included a $15.1 million pretax, non-cash pension charge.[2] The prior-year results included a $15.1 million pre-tax, non-cash pension curtailment charge.[3]
Lehman Brothers analyst Dana Guido said the industry's price increases expected for the second quarter may not stick through the second half of the year, especially because of weakness in the U.S. economy. [9] WHAT'S AHEAD: Investors will be watching the price of coke, iron and molybdenum, which is used to produce higher-value steel products.[9]
SOURCES
1. Mineweb - FAST NEWS - AK Steel`s Q1 profit jumps more than 60%
2. AK Steel 1Q profits up 60 percent - Forbes.com
3. AK Steel Q1 Profit Jumps On Higher Revenue, Prices; Issues Q2 Forecast; Announces Quarterly Cash Dividend - Update [AKS] - RTTNews, Today's Top Stories, Global Newswires, ToDay's Top News,Global Business news .
4. Schaeffer's Investment Research - Schaeffer's Daily Market Blog: Breaking Option News, Commentary, & In-depth Analysis
5. AK Steel posts $101.1M earnings for first quarter
6. Higher sales, prices propel AK Steel to healthy 1Q - Dayton Business Journal:
7. AK Steel :: AK Steel Reports Net Income of $101.1 Million For First Quarter of 2008
8. AK Steel 1Q Net Jumps 60%; Sees 2Q Operating Profit $125/Ton
9. Earnings Preview: AK Steel Holding to post strong 1Q results | Chron.com - Houston Chronicle
10. Higher sales, prices give AK Steel healthy 1Q - Business First of Columbus:
11. UPDATE 1 - AK Steel's first-quarter profit jumps | Industries | Industrials, Materials & Utilities | Reuters
12. Free Preview - WSJ.com
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