US Steel To Idle 3 BFs At Great Lakes, Gary Works & Kosice
United States Steel Corporation, while providing second quarter 2019 guidance, said “We are idling two blast furnaces in the United States and one blast furnace in Europe to better align our global production with our order book. In the United States, we began a planned maintenance outage on the Great Lakes B2 blast furnace last week. Based on current market conditions, we expect the B2 blast furnace to remain idled after the completion of the planned outage. In addition, we expect to temporarily idle a south blast furnace at our Gary Works facility. As a result of these footprint actions, we expect to decrease monthly blast furnace production capacity by approximately 200,000-225,000 tons beginning in July. If both furnaces remain idled for the remainder of the year, we expect full year Flat-Rolled shipments to third party customers to be approximately 11.0 million tons. We will resume blast furnace production at one or both idled blast furnaces when market conditions improve.”
US Steel said “In Europe, USSE continues to be negatively impacted by increasing levels of imports and continued market headwinds related to raw material costs and demand. As a result, we will idle the #2 blast furnace, which has the capacity to produce approximately 125,000 tons per month. If #2 blast furnace remains idled for the remainder of the year, we expect full year USSE shipments to third party customers to be approximately 3.6 million tons. We will resume #2 blast furnace production when market conditions improve.”
It added “While market conditions have softened, we remain focused on executing the value creation strategy that is underway. We believe that the investments being made to improve costs and expand product capabilities will create a more differentiated and agile company, combining our competitive advantages with state-of-the-art sustainable steel technology to create long-term value for our stockholders, customers and employees.”
It added “Flat Rolled segment adjusted EBITDA, which we expect to be higher versus the first quarter, is being negatively impacted by decreasing steel prices and softening end market demand. Additionally, second quarter shipments are lower than we expected due to flooding in the southern United States, which has limited the availability of barges and our ability to ship finished product to customers over the past few weeks. For both our USSE and Tubular segments, we expect second quarter 2019 adjusted EBITDA to be lower than first quarter 2019. In Europe, market headwinds have increased while Tubular margins are under pressure due to lower selling prices.”
Guidance “We expect second quarter 2019 adjusted EBITDA to be approximately USD 250 million, which excludes approximately USD 15 million of estimated second quarter impacts from the December 24, 2018 fire at our Clairton coke making facility. We expect second quarter 2019 adjusted diluted earnings per share to be approximately USD 0.40.
Source : Strategic Research Institute