AK Steel Reports 1st Quarter Income
04/23/2008 - AK Steel reports net income of $101.1 million on net sales of $1,791.4 million for the first quarter of 2008.
AK Steel reported net income of $101.1 million on net sales of $1,791.4 million for the first quarter of 2008.
First-Quarter Results—The $101.1-million net income ($0.90 per diluted share of common stock) reflects a 60% increase compared to net income of $62.7 million ($0.56 per diluted share) for the first quarter of 2007; first-quarter ’07 results had included a $15.1-million pre-tax, non-cash pension-curtailment charge. Net sales of $1,791.4 million compare to net sales of $1,719.9 million for the year-ago first quarter, while shipments of 1,578,400 tons compare to shipments of 1,596,200 tons last year.
The company said its average selling price reached a record $1,135 per ton, a 5% 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. The increase in selling prices resulted from higher spot and contract steel prices, coupled with increased raw-material surcharges.
Operating profit was $169.7 million ($108 per ton), an increase of about 40% compared to the operating profit of $120.0 million ($75 per ton) in the first quarter of 2007. Last year’s results 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."
Second-Quarter Outlook—AK Steel said it expects shipments to reach approximately 1,700,000 tons in the second quarter of 2008, which reflects an approximately 8% increase over first-quarter level. The company anticipates that its average selling prices will increase approximately $100 per ton compared to the first quarter of 2008.
Planned maintenance costs are expected to be approximately $40 million higher in the second quarter compared to the first quarter, primarily the result of a nearly three-week planned blast furnace maintenance outage at its Middletown Works, which is underway.
The company is also expecting to generate record operating profit of approximately $125 per ton in the second quarter of 2008.
AK Steel produces flat-rolled carbon, stainless and electrical steels, primarily for automotive, appliance, construction and electrical power generation and distribution markets. The company employs about 6,500 men and women in Middletown, Mansfield, Coshocton and Zanesville, Ohio; Butler, Pa.; Ashland, Ky.; Rockport, Ind.; and its corporate headquarters in West Chester, Ohio.
AK Tube LLC, a wholly owned subsidiary of AK Steel, employs about 300 men and women in plants in Walbridge, Ohio, and Columbus, Ind. AK Tube produces carbon and stainless electric resistance welded (ERW) tubular steel products for truck, automotive and other markets.
