AK Steel reports Q4 loss of US$98.3M compared with earnings of US$39.8M in year-ago period, full-year loss of US$128.9M versus US$74.6M loss a year ago; Q4 loss attributed to plant shutdown, lawsuit by retired workers
WEST CHESTER, Ohio
January 25, 2011
– AK Steel Holding Corp. said Tuesday it reported a loss in the fourth quarter after taking charges related to the shutdown of a plant and settling a lawsuit brought by retired workers.
The company posted a loss of $98.3 million, or 89 cents per share. The results included a pretax charge of $63.7 million connected to the shutdown of a coke plant in Ashland, Ky., and a $9.1 million pretax charge related to a lawsuit brought by former employees of Butler Works in Pennsylvania. Excluding those and other items, AK Steel said it lost 49 cents per share. In the fourth quarter of 2009 it earned $39.8 million, or 36 cents per share.
Revenue rose 5 percent to $1.39 billion from $1.32 billion.
Analysts expected a loss of 64 cents per share and $1.4 billion in revenue, according to estimates compiled by FactSet.
AK Steel said its average selling price grew 6 percent to $1,022 per ton, but the company said it lost $60 per ton excluding one-time items. Its shipping tonnage decreased 1 percent from a year ago.
In December AK Steel said it would close down the Ashland coke plant, a process it expects to complete by the second quarter of 2011. The company said it plans to make more of its own raw materials, and cited greater maintenance costs and environmental regulations, which it said made the plant less cost efficient.
Earlier this month, AK Steel and a group of 3,000 retired Butler Works employees settled a lawsuit that stemmed from AK Steel's plan to cut some of their benefits and charge premiums for other benefits. The workers said the changes violated collective bargaining agreements. AK Steel agreed to spend $87.6 million on benefits through 2014, and set aside $91 million for a trust fund that will continue to pay the benefits.
For the full year, the company lost $128.9 million, or $1.17 per share, including a charge of $25.3 million related to the federal health care overhaul that was passed in March. That was wider than the loss of $74.6 million, or 68 cents per share, in 2009. Its revenue rose 46 percent to $5.97 billion from $4.08 billion.
AK Steel said it expects to break even per ton in the first quarter, excluding one-time items. The company expects to ship 1.45 million tons of steel and said selling prices will be stronger than in the fourth quarter, although raw material costs will also be higher.
The company also declared a quarterly dividend of 5 cents, payable March 10 to shareholders of record on Feb. 11.
Shares of AK Steel picked up 42 cents, or 2.9 percent, to $14.88 in morning trading.
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