PITTSBURGH, Jan. 31, 2017
/PRNewswire/ -- United States Steel Corporation (NYSE: X)
reported a full-year 2016 net loss of $440
million, or $2.81 per diluted
share, which included unfavorable adjustments totaling $190 million, or $1.21 per diluted share. This compared to a
full-year 2015 net loss of $1.6
billion, or $11.24 per diluted
share, which included unfavorable adjustments totaling $1.4 billion, or $9.45 per diluted share.
Fourth quarter 2016 net loss of $105
million, or $0.61 per diluted
share, included unfavorable adjustments totaling $152 million, or $0.88 per diluted share. This compares to
fourth quarter 2015 net loss of $1.1
billion, or $7.74 per diluted
share, which included unfavorable adjustments totaling $1.1 billion, or $7.51 per diluted share, and third quarter 2016
net earnings of $51 million, or
$0.32 per diluted share, which
included unfavorable adjustments totaling $14 million, or $0.08 per diluted share.
For a description of the non-generally accepted accounting
principles (non-GAAP) measures and a reconciliation from net
earnings (loss) attributable to U. S. Steel, see the non-GAAP
Financial Measures section.
Earnings
Highlights
|
|
|
|
(Dollars in
millions, except per share amounts)
|
4Q
2016
|
3Q
2016
|
4Q
2015
|
2016
|
2015
|
Net
Sales
|
$
|
2,650
|
|
$
|
2,686
|
|
$
|
2,572
|
|
$
|
10,261
|
|
$
|
11,574
|
|
Segment earnings
(loss) before interest and income taxes
|
|
|
|
|
|
Flat-Rolled
|
$
|
65
|
|
$
|
114
|
|
$
|
(88)
|
|
$
|
(3)
|
|
$
|
(237)
|
|
U. S. Steel
Europe
|
63
|
|
81
|
|
6
|
|
185
|
|
81
|
|
Tubular
|
(87)
|
|
(75)
|
|
(64)
|
|
(304)
|
|
(179)
|
|
Other Businesses
|
21
|
|
18
|
|
9
|
|
63
|
|
33
|
|
Total segment
earnings (loss) before interest and income taxes
|
$
|
62
|
|
$
|
138
|
|
$
|
(137)
|
|
$
|
(59)
|
|
$
|
(302)
|
|
Postretirement
benefit income (expense)
|
26
|
|
8
|
|
(5)
|
|
62
|
|
(43)
|
|
Other items not
allocated to segments
|
(152)
|
|
(14)
|
|
(311)
|
|
(168)
|
|
(857)
|
|
(Loss) earnings
before interest and income taxes
|
$
|
(64)
|
|
$
|
132
|
|
$
|
(453)
|
|
$
|
(165)
|
|
$
|
(1,202)
|
|
Net interest and
other financial costs
|
43
|
|
62
|
|
87
|
|
251
|
|
257
|
|
Income tax
(benefit) provision
|
(2)
|
|
19
|
|
593
|
|
24
|
|
183
|
|
Less: Net earnings
attributable to the noncontrolling interests
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
Net (loss)
earnings attributable to United States Steel
Corporation
|
$
|
(105)
|
|
$
|
51
|
|
$
|
(1,133)
|
|
$
|
(440)
|
|
$
|
(1,642)
|
|
-(Loss) earnings
per basic share
|
$
|
(0.61)
|
|
$
|
0.32
|
|
$
|
(7.74)
|
|
$
|
(2.81)
|
|
$
|
(11.24)
|
|
-(Loss) earnings
per diluted share
|
$
|
(0.61)
|
|
$
|
0.32
|
|
$
|
(7.74)
|
|
$
|
(2.81)
|
|
$
|
(11.24)
|
|
|
|
|
|
|
|
Adjusted earnings
(loss) before interest, income taxes, depreciation and amortization
(EBITDA) (a)
|
$
|
211
|
|
$
|
272
|
|
$
|
(13)
|
|
$
|
510
|
|
$
|
202
|
|
(a) Please refer to the non-GAAP Financial Measures
section of this document for the reconciliation of net earnings
(loss) attributable to United States Steel Corporation to adjusted
EBITDA.
Commenting on results, U. S. Steel President and Chief
Executive Officer Mario Longhi said,
"We entered 2016 facing very challenging market conditions, but
remained focused on our Carnegie Way transformation efforts.
Despite lower average realized prices and shipments in 2016, our
results are better as we continued to improve our product mix and
cost structure. Our focus on cash, including better working
capital management and opportunistic capital markets transactions,
resulted in an improved debt maturity profile and stronger cash and
liquidity. We are well positioned to accelerate the
revitalization of our assets to improve our operating reliability
and efficiency, and deliver value-enhancing solutions to our
customers."
Segment earnings before interest and income taxes were
$62 million, or $16 per ton, for the fourth quarter of 2016
compared with segment earnings before interest and income taxes of
$138 million, or $37 per ton, in the third quarter of 2016 and a
segment loss before interest and income taxes of $137 million, or $37 per ton, in the fourth quarter of 2015.
For the fourth quarter 2016, we recorded a tax benefit of
$2 million on our pre-tax loss of
$107 million. For the full-year
2016, we recorded a tax provision of $24
million on our pre-tax loss of $416
million. Due to the full valuation allowance on our
domestic deferred tax assets, the tax provision does not reflect
any tax impact on domestic results.
We generated positive operating cash flow of $727 million for the year ended December 31,
2016. As of December 31, 2016, U. S. Steel had
$1.5 billion of cash and $2.9 billion of total liquidity.
Segment Analysis
Fourth quarter results for our Flat-Rolled segment declined as
compared with the third quarter primarily due to a decrease in
average realized prices, fewer shipments, as well as increased
outage spending. Planned outages as part of our previously
announced asset revitalization process limited the amount of tons
we could ship in the quarter. Full-year Flat-Rolled segment
results for 2016 improved from 2015 largely due to lower raw
material costs, lower spending, and benefits provided by our
Carnegie Way efforts. These improvements were partially
offset by lower average realized prices and shipments.
Fourth quarter results for our European segment declined as
compared with the third quarter primarily due to rising raw
material costs, particularly for coking coal and iron units.
These adverse impacts were partially offset by increased shipments
and reduced spending. Full-year European segment results for
2016 improved from 2015 due to lower raw material and energy costs
along with better operating efficiencies from running at higher
utilization rates, partially offset by lower average realized
prices.
Fourth quarter results for our Tubular segment declined as
compared with the third quarter largely due to an unfavorable lower
of cost or market (LCM) adjustment for obsolete inventory related
to the prolonged downturn in the energy markets. Full-year
2016 results for our Tubular segment decreased from 2015 due to a
combination of lower average realized prices and shipments, as well
as the LCM adjustment for obsolete inventory, only partly offset by
lower substrate costs and improved spending.
2017 Outlook
Commenting on U. S. Steel's outlook for 2017, Longhi said, "We
are starting 2017 with much better market conditions than we faced
at the beginning of 2016. Our Carnegie Way transformation
efforts over the last three years have improved our cost structure,
streamlined our operating footprint and increased our customer
focus. These substantive changes and improvements have increased
our earnings power. While we will benefit from improved
market conditions, they continue to be volatile and we must remain
focused on improving the things that we can control. Pursuing
our safety objective of zero injuries, improving our assets and
operating performance, and driving innovation that creates
differentiated solutions for our customers remain our top
priorities."
If market conditions, which include spot prices, raw material
costs, customer demand, import volumes, supply chain inventories,
rig counts and energy prices, remain at their current levels, we
expect:
- 2017 net earnings of approximately $535
million, or $3.08 per share,
and EBITDA of approximately $1.3
billion;
- Results for our Flat-Rolled, European, and Tubular segments to
be higher than 2016;
- To be cash positive for the year, primarily due to improved
cash from operations; and
- Other Businesses to be comparable to 2016 and approximately
$50 million of postretirement benefit
expense.
We believe market conditions will change, and as changes occur
during the balance of 2017, our net earnings and EBITDA should
change consistent with the pace and magnitude of changes in market
conditions.
Please refer to the non-GAAP Financial Measures section of this
document for the reconciliation of the Outlook net earnings to
EBITDA.
*****
We present adjusted net earnings (loss), adjusted net earnings
(loss) per diluted share, earnings (loss) 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 the net earnings
(loss), is a relevant indicator of trends relating to cash
generating activity and provides management and investors with
additional information for comparison of our operating results to
the operating results of other companies.
Adjusted net earnings (loss) and adjusted net earnings (loss)
per diluted share are non-GAAP measures that exclude the effects of
restructuring charges, impairment charges, losses associated with
U. S. Steel Canada Inc., losses on debt extinguishment, certain
postemployment actuarial adjustments, and charges for deferred tax
asset valuation allowances that are not part of the Company's core
operations. Adjusted EBITDA is also a non-GAAP measure that
excludes the effects of restructuring charges, impairment charges,
losses associated with U. S. Steel Canada Inc, and certain
postemployment actuarial adjustments. We present adjusted net
earnings (loss), adjusted net earnings (loss) per diluted share and
adjusted EBITDA to enhance the understanding of our ongoing
operating performance and established trends affecting our core
operations, particularly cash generating activity, by excluding the
effects of restructuring charges, impairment charges, losses on
debt extinguishment, certain postemployment actuarial adjustments,
charges for deferred tax asset valuation allowances, and losses
associated with non-core operations that can obscure underlying
trends. U. S. Steel's management considers adjusted net
earnings (loss), adjusted net earnings (loss) per diluted share and
adjusted EBITDA useful to investors by facilitating a comparison of
our operating performance to the operating performance of our
competitors, many of which use adjusted net earnings (loss),
adjusted net earnings (loss) per diluted share and adjusted EBITDA
as alternative measures of operating performance.
Additionally, the presentation of adjusted net earnings (loss),
adjusted net earnings (loss) 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 adjusting items when evaluating the Company's
financial performance or in preparing the Company's annual
financial outlook. Adjusted net earnings (loss), adjusted net
earnings (loss) per diluted share and adjusted EBITDA should not be
considered a substitute for net earnings (loss), earnings (loss)
per diluted share or other financial measures as computed in
accordance with U.S. GAAP and is not necessarily comparable to
similarly titled measures used by other companies.
A consolidated statement of operations (unaudited), consolidated
cash flow statement (unaudited), condensed consolidated balance
sheet (unaudited) and preliminary supplemental statistics
(unaudited) for U. S. Steel are attached.
The Company will conduct a conference call on fourth quarter and
full-year 2016 earnings on Wednesday,
February 1, at 8:30 a.m.
Eastern Standard. To listen to the webcast of the conference
call, visit the U. S. Steel website, www.ussteel.com, and
click on "Current Information" under the "Investors" section.
For more information on U. S. Steel, visit our website
at www.ussteel.com.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING
STATEMENTS
This release contains information that may constitute
"forward-looking statements" within the meaning of Section 27 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,"
"will" and similar expressions or by using future dates in
connection with any discussion of, among other things, operating
performance, trends, events or developments that we expect or
anticipate will occur in the future, statements relating to volume
growth, share of sales and earnings per share growth, 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, 2015, and those described from time to time in
our future reports filed with the Securities and Exchange
Commission.
References to "we," "us," "our," the "Company," and "U. S.
Steel," refer to United States Steel Corporation and its
Consolidated Subsidiaries.
UNITED STATES
STEEL CORPORATION
|
STATEMENT OF
OPERATIONS (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter
Ended
|
|
Year Ended
|
|
|
|
Dec. 31
|
|
Sept. 30
|
|
Dec. 31
|
|
December
31,
|
(Dollars in millions,
except per share amounts)
|
2016
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
NET SALES
|
|
$
|
2,650
|
|
|
$
|
2,686
|
|
|
$
|
2,572
|
|
|
$
|
10,261
|
|
|
$
|
11,574
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING EXPENSES
(INCOME):
|
|
|
|
|
|
|
|
|
|
|
Cost of sales
(excludes items shown below)
|
2,430
|
|
|
2,360
|
|
|
2,629
|
|
|
9,623
|
|
|
11,141
|
|
|
Selling, general and
administrative expenses
|
49
|
|
|
73
|
|
|
107
|
|
|
255
|
|
|
415
|
|
|
Depreciation,
depletion and amortization
|
123
|
|
|
126
|
|
|
129
|
|
|
507
|
|
|
547
|
|
|
Earnings from
investees
|
(7)
|
|
|
(18)
|
|
|
(9)
|
|
|
(98)
|
|
|
(38)
|
|
|
Impairment of
intangible assets
|
—
|
|
|
14
|
|
|
—
|
|
|
14
|
|
|
—
|
|
|
Losses associated
with U. S. Steel Canada Inc.
|
—
|
|
|
—
|
|
|
121
|
|
|
—
|
|
|
392
|
|
|
Restructuring and
other charges
|
121
|
|
|
(3)
|
|
|
47
|
|
|
122
|
|
|
322
|
|
|
Net (gain) loss on
disposal of assets
|
(1)
|
|
|
3
|
|
|
—
|
|
|
5
|
|
|
(2)
|
|
|
Other (income)
expenses, net
|
(1)
|
|
|
(1)
|
|
|
1
|
|
|
(2)
|
|
|
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating expenses
|
2,714
|
|
|
2,554
|
|
|
3,025
|
|
|
10,426
|
|
|
12,776
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(LOSS) EARNINGS
BEFORE INTEREST AND INCOME TAXES
|
(64)
|
|
|
132
|
|
|
(453)
|
|
|
(165)
|
|
|
(1,202)
|
|
Net interest and
other financial costs
|
43
|
|
|
62
|
|
|
87
|
|
|
251
|
|
|
257
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(LOSS) EARNINGS
BEFORE INCOME TAXES
|
(107)
|
|
|
70
|
|
|
(540)
|
|
|
(416)
|
|
|
(1,459)
|
|
Income tax (benefit)
provision
|
(2)
|
|
|
19
|
|
|
593
|
|
|
24
|
|
|
183
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss)
earnings
|
(105)
|
|
|
51
|
|
|
(1,133)
|
|
|
(440)
|
|
|
(1,642)
|
|
|
Less: Net earnings
(loss) attributable to the
|
|
|
|
|
|
|
|
|
|
|
noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
NET (LOSS) EARNINGS
ATTRIBUTABLE TO
|
|
|
|
|
|
|
|
|
|
|
UNITED STATES STEEL
CORPORATION
|
$
|
(105)
|
|
|
$
|
51
|
|
|
$
|
(1,133)
|
|
|
$
|
(440)
|
|
|
$
|
(1,642)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COMMON STOCK
DATA:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) earnings
per share attributable to
|
|
|
|
|
|
|
|
|
|
United
States Steel Corporation stockholders:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
(0.61)
|
|
|
$
|
0.32
|
|
|
$
|
(7.74)
|
|
|
$
|
(2.81)
|
|
|
$
|
(11.24)
|
|
|
Diluted
|
|
$
|
(0.61)
|
|
|
$
|
0.32
|
|
|
$
|
(7.74)
|
|
|
$
|
(2.81)
|
|
|
$
|
(11.24)
|
|
Weighted average
shares, in thousands
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
172,975
|
|
|
160,513
|
|
|
146,347
|
|
|
156,673
|
|
|
146,094
|
|
|
Diluted
|
|
172,975
|
|
|
161,700
|
|
|
146,347
|
|
|
156,673
|
|
|
146,094
|
|
Dividends paid per
common share
|
$
|
0.05
|
|
|
$
|
0.05
|
|
|
$
|
0.05
|
|
|
$
|
0.20
|
|
|
$
|
0.20
|
|
UNITED STATES
STEEL CORPORATION
|
CASH FLOW STATEMENT
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended
|
|
|
|
|
December
31,
|
(Dollars in
millions)
|
|
2016
|
|
2015
|
Cash provided by
operating activities:
|
|
|
|
|
Net loss
|
|
$
|
(440)
|
|
|
$
|
(1,642)
|
|
|
Depreciation,
depletion and amortization
|
507
|
|
|
547
|
|
|
Impairment of
intangible assets
|
14
|
|
|
—
|
|
|
Losses associated
with U. S. Steel Canada Inc.
|
—
|
|
|
392
|
|
|
Restructuring and
other charges
|
122
|
|
|
322
|
|
|
Loss on debt
extinguishment
|
22
|
|
|
36
|
|
|
Pensions and other
postretirement benefits
|
(62)
|
|
|
50
|
|
|
Deferred income
taxes
|
9
|
|
|
213
|
|
|
Net loss (gain) on
disposal of assets
|
5
|
|
|
(2)
|
|
|
Working capital
changes
|
596
|
|
|
551
|
|
|
Income taxes
receivable/payable
|
10
|
|
|
6
|
|
|
Other operating
activities
|
(56)
|
|
|
(114)
|
|
|
|
Total
|
|
727
|
|
|
359
|
|
|
|
|
|
|
|
|
Cash used in
investing activities:
|
|
|
|
|
Capital
expenditures
|
|
(306)
|
|
|
(500)
|
|
|
Acquisitions
|
|
—
|
|
|
(25)
|
|
|
Disposal of
assets
|
|
12
|
|
|
4
|
|
|
Other investing
activities
|
|
(24)
|
|
|
11
|
|
|
|
Total
|
|
(318)
|
|
|
(510)
|
|
|
|
|
|
|
|
|
Cash provided by
(used in) financing activities:
|
|
|
|
|
Issuance of long-term
debt, net of financing costs
|
958
|
|
|
—
|
|
|
Repayment of
long-term debt
|
|
(1,070)
|
|
|
(379)
|
|
|
Settlement of
contingent consideration
|
(15)
|
|
|
—
|
|
|
Common stock
issued
|
|
482
|
|
|
—
|
|
|
Receipts from
exercise of stock options
|
35
|
|
|
1
|
|
|
Dividends
paid
|
|
(31)
|
|
|
(29)
|
|
|
|
Total
|
|
359
|
|
|
(407)
|
|
|
|
|
|
|
|
|
Effect of exchange
rate changes on cash
|
(8)
|
|
|
(41)
|
|
|
|
|
|
|
|
|
Net increase
(decrease) in cash and cash equivalents
|
760
|
|
|
(599)
|
|
Cash and cash
equivalents at beginning of the year
|
755
|
|
|
1,354
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents at end of the period
|
$
|
1,515
|
|
|
$
|
755
|
|
UNITED STATES
STEEL CORPORATION
|
CONDENSED BALANCE
SHEET (Unaudited)
|
|
|
|
|
|
|
|
|
|
Dec. 31
|
|
Dec. 31
|
(Dollars in
millions)
|
|
2016
|
|
2015
|
Cash and cash
equivalents
|
$
|
1,515
|
|
|
$
|
755
|
|
Receivables,
net
|
1,248
|
|
|
1,063
|
|
Inventories
|
1,573
|
|
|
2,074
|
|
Other current
assets
|
20
|
|
|
25
|
|
|
Total current
assets
|
4,356
|
|
|
3,917
|
|
Property, plant and
equipment, net
|
3,979
|
|
|
4,411
|
|
Investments and
long-term receivables, net
|
528
|
|
|
540
|
|
Intangible assets,
net
|
175
|
|
|
196
|
|
Other
assets
|
122
|
|
|
103
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
|
9,160
|
|
|
$
|
9,167
|
|
|
|
|
|
|
|
Accounts
payable
|
$
|
1,668
|
|
|
$
|
1,493
|
|
Payroll and benefits
payable
|
400
|
|
|
462
|
|
Short-term debt and
current maturities of long-term debt
|
50
|
|
|
45
|
|
Other current
liabilities
|
213
|
|
|
148
|
|
|
Total current
liabilities
|
2,331
|
|
|
2,148
|
|
Long-term debt, less
unamortized discount and debt issuance costs
|
2,981
|
|
|
3,093
|
|
Employee
benefits
|
1,216
|
|
|
1,101
|
|
Other long-term
liabilities
|
357
|
|
|
388
|
|
United States Steel
Corporation stockholders' equity
|
2,274
|
|
|
2,436
|
|
Noncontrolling
interests
|
1
|
|
|
1
|
|
|
|
|
|
|
|
|
Total liabilities and
stockholders' equity
|
$
|
9,160
|
|
|
$
|
9,167
|
|
UNITED STATES
STEEL CORPORATION
NON-GAAP FINANCIAL MEASURES
(Unaudited)
We present adjusted net earnings (loss), adjusted net earnings
(loss) per diluted share, earnings (loss) before interest, income
taxes, depreciation and amortization (EBITDA) and adjusted EBITDA,
which are all non-GAAP measures, as additional measurements to
enhance the understanding of our operating performance. We
believe that EBITDA, considered along with the net earnings (loss),
is a relevant indicator of trends relating to cash generating
activity and provides management and investors with additional
information for comparison of our operating results to the
operating results of other companies. Adjusted net earnings
(loss) and adjusted net earnings (loss) per diluted share are
non-GAAP measures that exclude the effects of restructuring
charges, impairment charges, losses associated with U. S. Steel
Canada Inc., losses on debt extinguishment, certain postemployment
actuarial adjustments, and charges for deferred tax asset valuation
allowances that are not part of the Company's core operations.
Adjusted EBITDA is also a non-GAAP measure that excludes the
effects of restructuring charges, impairment charges, losses
associated with U. S. Steel Canada Inc., and certain postemployment
actuarial adjustments. We present adjusted net earnings
(loss), adjusted net earnings (loss) per diluted share and adjusted
EBITDA to enhance the understanding of our ongoing operating
performance and established trends affecting our core operations,
particularly cash generating activity, by excluding the effects of
restructuring charges, impairment charges, losses on debt
extinguishment, certain postemployment actuarial adjustments,
charges for deferred tax asset valuation allowances, and losses
associated with non-core operations that can obscure underlying
trends. U. S. Steel's management considers adjusted net
earnings (loss), adjusted net earnings (loss) per diluted share and
adjusted EBITDA useful to investors by facilitating a comparison of
our operating performance to the operating performance of our
competitors, many of which use adjusted net earnings (loss),
adjusted net earnings (loss) per diluted share and adjusted EBITDA
as alternative measures of operating performance.
Additionally, the presentation of adjusted net earnings (loss),
adjusted net earnings (loss) 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 adjusting items when evaluating the Company's
financial performance or in preparing the Company's annual
financial outlook. Adjusted net earnings (loss), adjusted net
earnings (loss) per diluted share and adjusted EBITDA should not be
considered a substitute for net earnings (loss), earnings (loss)
per diluted share or other financial measures as computed in
accordance with U.S. GAAP and is not necessarily comparable to
similarly titled measures used by other companies.
RECONCILIATION OF
ADJUSTED EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter
Ended
|
|
Year Ended
|
|
|
Dec. 31
|
|
Sept. 30
|
|
Dec. 31
|
|
Dec. 31
|
|
Dec. 31
|
(Dollars in
millions)
|
2016
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Reconciliation to
Adjusted EBITDA
|
|
|
|
|
|
|
|
|
|
|
Net (loss) earnings
attributable to United States Steel Corporation
|
$
|
(105)
|
|
|
$
|
51
|
|
|
$
|
(1,133)
|
|
|
$
|
(440)
|
|
|
$
|
(1,642)
|
|
|
Income tax (benefit)
provision
|
(2)
|
|
|
19
|
|
|
593
|
|
|
24
|
|
|
183
|
|
|
Net interest and
other financial costs
|
43
|
|
|
62
|
|
|
87
|
|
|
251
|
|
|
257
|
|
|
Depreciation,
depletion and amortization expense
|
123
|
|
|
126
|
|
|
129
|
|
|
507
|
|
|
547
|
|
|
EBITDA
|
59
|
|
|
258
|
|
|
(324)
|
|
|
342
|
|
|
(655)
|
|
|
Loss on shutdown of
certain tubular pipe mill assets
|
126
|
|
|
—
|
|
|
—
|
|
|
126
|
|
|
—
|
|
|
Supplemental
unemployment, severance costs and other charges
|
(4)
|
|
|
—
|
|
|
47
|
|
|
(2)
|
|
|
78
|
|
|
Impairment of
intangible assets
|
—
|
|
|
14
|
|
|
—
|
|
|
14
|
|
|
—
|
|
|
Loss on shutdown of
Fairfield Flat-Rolled operations
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
91
|
|
|
Losses associated
with U. S. Steel Canada Inc.
|
—
|
|
|
—
|
|
|
121
|
|
|
—
|
|
|
392
|
|
|
Loss on shutdown of
coke production facilities
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
153
|
|
|
Granite City Works
temporary idling charges
|
18
|
|
|
—
|
|
|
99
|
|
|
18
|
|
|
99
|
|
|
Postemployment
benefit actuarial adjustment
|
—
|
|
|
—
|
|
|
26
|
|
|
—
|
|
|
26
|
|
|
Impairment of equity
investment
|
12
|
|
|
—
|
|
|
18
|
|
|
$
|
12
|
|
|
18
|
|
|
Adjusted
EBITDA
|
$
|
211
|
|
|
$
|
272
|
|
|
$
|
(13)
|
|
|
$
|
510
|
|
|
$
|
202
|
|
UNITED STATES
STEEL CORPORATION
|
NON-GAAP FINANCIAL
MEASURES (Unaudited)
|
|
RECONCILIATION TO
ADJUSTED NET EARNINGS (LOSS)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter
Ended(a)
|
|
Year
Ended(a)
|
|
|
Dec. 31
|
|
Sept. 30
|
|
Dec. 31
|
|
Dec. 31
|
|
Dec. 31
|
(Dollars in millions,
except per share amounts)
|
2016
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Reconciliation to
adjusted net earnings (loss) attributable to United States Steel
Corporation
|
|
|
|
|
|
|
|
|
|
|
Net (loss) earnings
attributable to United States Steel Corporation
|
$
|
(105)
|
|
|
$
|
51
|
|
|
$
|
(1,133)
|
|
|
$
|
(440)
|
|
|
$
|
(1,642)
|
|
|
Loss on shutdown of
certain tubular pipe mill assets
|
126
|
|
|
—
|
|
|
—
|
|
|
126
|
|
|
—
|
|
|
Supplemental
unemployment, severance costs and other charges
|
(4)
|
|
|
—
|
|
|
47
|
|
|
(2)
|
|
|
64
|
|
|
Loss on debt
extinguishment
|
—
|
|
|
—
|
|
|
—
|
|
|
22
|
|
|
—
|
|
|
Impairment of
intangible assets
|
—
|
|
|
14
|
|
|
—
|
|
|
14
|
|
|
—
|
|
|
Loss on shutdown of
Fairfield Flat-Rolled operations
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
53
|
|
|
Losses associated
with U. S. Steel Canada Inc.
|
—
|
|
|
—
|
|
|
121
|
|
|
—
|
|
|
266
|
|
|
Granite City Works
temporary idling charges
|
18
|
|
|
—
|
|
|
99
|
|
|
18
|
|
|
99
|
|
|
Loss on shutdown of
coke production facilities
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
65
|
|
|
Postemployment
benefit actuarial adjustment
|
—
|
|
|
—
|
|
|
26
|
|
|
—
|
|
|
26
|
|
|
Impairment of equity
investment
|
12
|
|
|
—
|
|
|
18
|
|
|
12
|
|
|
18
|
|
|
Loss on retirement of
senior convertible notes
|
—
|
|
|
—
|
|
|
36
|
|
|
—
|
|
|
36
|
|
|
Deferred tax asset
valuation allowance
|
—
|
|
|
—
|
|
|
753
|
|
|
—
|
|
|
753
|
|
|
Total adjustments
|
152
|
|
|
14
|
|
|
1,100
|
|
|
190
|
|
|
1,380
|
|
|
Adjusted net earnings
(loss) attributable to United States Steel Corporation
|
$
|
47
|
|
|
$
|
65
|
|
|
$
|
(33)
|
|
|
$
|
(250)
|
|
|
$
|
(262)
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation to
adjusted diluted net earnings (loss) per share
|
|
|
|
|
|
|
|
|
|
|
Diluted net (loss)
earnings per share
|
$
|
(0.61)
|
|
|
$
|
0.32
|
|
|
$
|
(7.74)
|
|
|
$
|
(2.81)
|
|
|
$
|
(11.24)
|
|
|
Loss on shutdown of
certain tubular pipe mill assets
|
0.73
|
|
|
—
|
|
|
—
|
|
|
0.80
|
|
|
—
|
|
|
Supplemental
unemployment, severance costs and other charges
|
(0.03)
|
|
|
—
|
|
|
0.32
|
|
|
(0.01)
|
|
|
0.44
|
|
|
Loss on debt
extinguishment
|
—
|
|
|
—
|
|
|
—
|
|
|
0.14
|
|
|
—
|
|
|
Impairment of
intangible assets
|
—
|
|
|
0.08
|
|
|
—
|
|
|
0.09
|
|
|
—
|
|
|
Loss on shutdown of
Fairfield Flat-Rolled operations
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.37
|
|
|
Losses associated
with U. S. Steel Canada Inc.
|
—
|
|
|
—
|
|
|
0.82
|
|
|
—
|
|
|
1.82
|
|
|
Granite City Works
temporary idling charges
|
0.11
|
|
|
—
|
|
|
0.68
|
|
|
0.11
|
|
|
0.68
|
|
|
Loss on shutdown of
coke production facilities
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.44
|
|
|
Postemployment
benefit actuarial adjustment
|
—
|
|
|
—
|
|
|
0.18
|
|
|
—
|
|
|
0.18
|
|
|
Impairment of equity
investment
|
0.07
|
|
|
—
|
|
|
0.12
|
|
|
0.08
|
|
|
0.12
|
|
|
Loss on retirement of
senior convertible notes
|
—
|
|
|
—
|
|
|
0.25
|
|
|
—
|
|
|
0.25
|
|
|
Deferred tax asset
valuation allowance
|
—
|
|
|
—
|
|
|
5.14
|
|
|
—
|
|
|
5.15
|
|
|
Total adjustments
|
0.88
|
|
|
0.08
|
|
|
7.51
|
|
|
1.21
|
|
|
9.45
|
|
|
Adjusted diluted net
earnings (loss) per share
|
$
|
0.27
|
|
|
$
|
0.40
|
|
|
$
|
(0.23)
|
|
|
$
|
(1.60)
|
|
|
$
|
(1.79)
|
|
(a) The adjustments included in this table have been
tax effected at a 0% tax rate due to the recognition of a full
valuation allowance.
UNITED STATES
STEEL CORPORATION
|
RECONCILIATION OF
ANNUAL EBITDA OUTLOOK
|
|
|
|
|
|
Year Ended
|
|
|
Dec. 31
|
(Dollars in
millions)
|
2017
|
Reconciliation to
Projected Annual EBITDA Included in Outlook
|
|
|
Projected net
earnings attributable to United States Steel Corporation included
in Outlook
|
$
|
535
|
|
|
Estimated income tax
expense
|
60
|
|
|
Estimated net
interest and other financial costs
|
245
|
|
|
Estimated
depreciation, depletion and amortization
|
460
|
|
|
Projected annual
EBITDA included in Outlook
|
$
|
1,300
|
|
UNITED STATES
STEEL CORPORATION
|
PRELIMINARY
SUPPLEMENTAL STATISTICS (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter
Ended
|
|
Year Ended
|
|
|
|
Dec. 31
|
|
Sept. 30
|
|
Dec. 31
|
|
December
31,
|
|
(Dollars in
millions)
|
2016
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
SEGMENT EARNINGS
(LOSS) BEFORE INTEREST AND INCOME TAXES
|
|
|
|
|
|
|
|
|
|
|
|
Flat-Rolled
|
$
|
65
|
|
|
$
|
114
|
|
|
$
|
(88)
|
|
|
$
|
(3)
|
|
|
$
|
(237)
|
|
|
|
U. S. Steel
Europe
|
63
|
|
|
81
|
|
|
6
|
|
|
185
|
|
|
81
|
|
|
|
Tubular
|
(87)
|
|
|
(75)
|
|
|
(64)
|
|
|
(304)
|
|
|
(179)
|
|
|
|
Other
Businesses
|
21
|
|
|
18
|
|
|
9
|
|
|
63
|
|
|
33
|
|
|
Total Segment
Earnings (Loss) Before Interest and Income Taxes
|
62
|
|
|
138
|
|
|
(137)
|
|
|
(59)
|
|
|
(302)
|
|
|
|
Postretirement
benefit income (expense)
|
26
|
|
|
8
|
|
|
(5)
|
|
|
62
|
|
|
(43)
|
|
|
|
Other items not
allocated to segments:
|
|
|
|
|
|
|
|
|
|
|
|
Loss on shutdown of
certain tubular pipe mill assets
|
(126)
|
|
|
—
|
|
|
—
|
|
|
(126)
|
|
|
—
|
|
|
|
Supplemental
unemployment and severance costs
|
4
|
|
|
—
|
|
|
(47)
|
|
|
2
|
|
|
(78)
|
|
|
|
Impairment of
intangible assets
|
—
|
|
|
(14)
|
|
|
—
|
|
|
(14)
|
|
|
|
|
|
Losses associated
with U. S. Steel Canada Inc.
|
—
|
|
|
—
|
|
|
(121)
|
|
|
—
|
|
|
(392)
|
|
|
|
Loss on shutdown of
coke production facilities
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(153)
|
|
|
|
Loss on shutdown of
Fairfield Flat-Rolled operations
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(91)
|
|
|
|
Granite City Works
temporary idling charges
|
(18)
|
|
|
—
|
|
|
(99)
|
|
|
(18)
|
|
|
(99)
|
|
|
|
Postemployment
benefit actuarial adjustment
|
—
|
|
|
—
|
|
|
(26)
|
|
|
—
|
|
|
(26)
|
|
|
|
Impairment of equity
investment
|
(12)
|
|
|
—
|
|
|
(18)
|
|
|
(12)
|
|
|
(18)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss) earnings
before interest and income taxes
|
$
|
(64)
|
|
|
$
|
132
|
|
|
$
|
(453)
|
|
|
$
|
(165)
|
|
|
$
|
(1,202)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CAPITAL
EXPENDITURES
|
|
|
|
|
|
|
|
|
|
|
|
Flat-Rolled
|
$
|
14
|
|
|
$
|
23
|
|
|
$
|
84
|
|
|
$
|
111
|
|
|
$
|
280
|
|
|
|
U. S. Steel
Europe
|
15
|
|
|
17
|
|
|
32
|
|
|
83
|
|
|
110
|
|
|
|
Tubular
|
7
|
|
|
11
|
|
|
27
|
|
|
88
|
|
|
102
|
|
|
|
Other
Businesses
|
2
|
|
|
—
|
|
|
3
|
|
|
24
|
|
|
8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
$
|
38
|
|
|
$
|
51
|
|
|
$
|
146
|
|
|
$
|
306
|
|
(a)
|
$
|
500
|
|
(a)
|
(a) Excludes the (decrease) increase in accrued
capital expenditures of $(85) million
and $59 million for the year ended
December 31, 2016, and 2015,
respectively.
UNITED STATES
STEEL CORPORATION
|
PRELIMINARY
SUPPLEMENTAL STATISTICS (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter
Ended
|
|
Year Ended
|
|
|
|
|
Dec. 31
|
|
Sept. 30
|
|
Dec. 31
|
|
December
31,
|
|
|
|
|
2016
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
OPERATING
STATISTICS
|
|
|
|
|
|
|
|
|
|
|
Average realized
price: (a)
|
|
|
|
|
|
|
|
|
|
|
|
Flat-Rolled ($/net
ton)
|
692
|
|
|
718
|
|
642
|
|
666
|
|
|
695
|
|
|
U. S. Steel Europe
($/net ton)
|
484
|
|
|
503
|
|
477
|
|
483
|
|
|
516
|
|
|
U.
S. Steel Europe (euro/net ton)
|
449
|
|
|
451
|
|
435
|
|
436
|
|
|
464
|
|
|
Tubular ($/net
ton)
|
1,027
|
|
|
1,049
|
|
1,273
|
|
1,071
|
|
|
1,464
|
|
Steel Shipments
(thousands of net tons):(a)
|
|
|
|
|
|
|
|
|
|
|
|
Flat-Rolled
|
2,369
|
|
|
2,535
|
|
2,591
|
|
10,094
|
|
|
10,595
|
|
|
U. S. Steel
Europe
|
1,261
|
|
|
1,105
|
|
982
|
|
4,496
|
|
|
4,357
|
|
|
Tubular
|
138
|
|
|
103
|
|
127
|
|
400
|
|
|
593
|
|
|
|
Total Steel
Shipments
|
3,768
|
|
|
3,743
|
|
3,700
|
|
14,990
|
|
|
15,545
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intersegment
Shipments (thousands of net tons):
|
|
|
|
|
|
|
|
|
|
|
|
Flat-Rolled to
Tubular
|
—
|
|
|
—
|
|
|
35
|
|
42
|
|
|
416
|
|
Raw Steel Production
(thousands of net tons):
|
|
|
|
|
|
|
|
|
|
|
|
Flat-Rolled
|
2,458
|
|
|
2,734
|
|
2,421
|
|
10,706
|
|
|
11,337
|
|
|
U. S. Steel
Europe
|
1,278
|
|
|
1,279
|
|
1,054
|
|
4,967
|
|
|
4,669
|
|
Raw Steel Capability
Utilization: (b)
|
|
|
|
|
|
|
|
|
|
|
|
Flat-Rolled
|
57
|
%
|
|
64
|
%
|
|
57
|
%
|
|
63
|
%
|
|
60
|
%
|
|
|
U. S. Steel
Europe
|
101
|
%
|
|
102
|
%
|
|
84
|
%
|
|
99
|
%
|
|
93
|
%
|
(a) Excludes intersegment shipments.
(b) Based on annual raw steel production capability
of 17.0 million net tons for Flat-Rolled and 5.0 million net tons
for U. S. Steel Europe. Prior to the permanent shutdown of
the blast furnace and associated steelmaking operations, along with
most of the flat-rolled finishing operations at Fairfield Works
late in the third quarter of 2015, annual raw steel production
capability for Flat-Rolled was 19.4 million net tons.
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/united-states-steel-corporation-reports-improved-2016-results-with-increased-operating-cash-flow-and-stronger-cash-and-liquidity-300399844.html
SOURCE United States Steel Corporation