(By Balaseshan) United States Steel Corp. (NYSE:X) reported a decline in quarterly earnings due to lower shipments and pricing. However, results exceeded Street's expectations, sending its shares up 4.55% in premarket.
Profit plunged 54.5% to $101 million for the second quarter, while earnings per share (EPS) dropped 53.4% to $0.62. Adjusted earnings declined to $112 million or $0.69 per share from $185 million or $1.12 per share.
Sales decreased 2% to $5.017 billion. Analysts, on average, polled by Thomson Reuters had expected a profit of $0.47 per share on sales of $4.99 billion.
Total steel shipments declined to 5.43 million tons from 5.50 million tons. Flat-rolled steel shipment increased to 3.99 million tons from 3.94 million tons, while U.S. Steel Europe shipment fell to 955,000 tons from 1.14 million tons. Tubular shipment rose to 493,000 tons from 424,000 tons.
Average realized price of flat-rolled steel decreased to $772 per net ton from $803 per net ton, while Average realized price of U.S. Steel Europe declined to $767 per net ton from $930 per net ton. Average realized price of Tubular grew to $1,706 per net ton from $1,565 per net ton.
Looking ahead into the third quarter, the company expects total reportable segment and Other Businesses operating results to be positive but below second quarter results, reflecting the continued weakness in the North American, European and emerging market economies.
Average realized prices are expected to be lower for all three operating segments with total reportable segment shipments slightly lower than the second quarter. The company's Tubular segment is expected to continue its trend of solid operating profits.
The company is currently negotiating with the United Steelworkers for a new labor agreement covering most of our domestic operations. The current agreement expires on September 1, 2012. United States Steel anticipates reaching a competitive agreement without a work stoppage.
X closed Monday's regular session at $18.92. The stock has been trading between $17.67 and $41.04 for the past 52 weeks.