AK Steel reported net income of $92.7 million on net sales of $1,311.8 million for the second quarter of 2004, and net income of $258.1 million on net sales of $2,446.2 million for the first six months.

Second Quarter Results—Net income of $92.7 million ($0.85 per share of common stock) compares to a net loss of $78.2 million ($0.72 per share) in the second quarter of 2003. Results include an after-tax gain of $44.2 million ($0.41 per share) on the sale of the company's Houston industrial park, and a tax benefit related to discontinued operations of $27.2 million ($0.25 per share).

Net sales of $1,311.8 million on shipments of 1,565,100 tons are 34% and 12% higher, respectively, than sales of $981.3 million and shipments of 1,399,000 tons in the year-ago quarter. Operating profit was $56.4 million and income from continuing operations was $20.2 million ($0.18 per share), which compares to a second quarter 2003 operating loss of $115.2 million and a loss from continuing operations of $86.6 million ($0.80 per share).

Six Month Results—Net income of $258.1 million ($2.37 per share) includes $246.3 million for the combined gain on the sale of Douglas Dynamics and Greens Port Industrial Park in Houston. For the same period in 2003, AK Steel reported a net loss of $119 million ($1.10 per share). Net sales of $2,446.2 million compare to $1,966.6 million in the first half of 2003. Operating profit, $57.9 million, compares to an operating loss of $158.3 million in the same period last year.

AK Steel said its liquidity at the end of the second quarter of 2004 totaled $735 million, including cash and availability under its two credit facilities, including an accounts receivable-based revolving credit facility established in May.

Comments—“AK Steel employees have earned well-deserved congratulations for helping us quickly reach an important milestone - earning income from operations,” said James L. Wainscott, President and CEO of AK Steel. Compared to where we were just nine months ago, that is a remarkable feat that we will savor only momentarily, as I believe all AK Steel employees recognize that much hard work remains in order to sustain and build upon the progress we have made.”

Mr. Wainscott reiterated the company's focus on what he termed the 3 C's—customers, costs and cash—for the first phase of the company's recovery. “Our attention to customers has helped restore and even increase business, resulting in higher volumes and record quarterly revenues,” he said. “At the same time, we have made excellent progress in cost control and replenishing our cash position. As we move into the second phase of our return to sustainable profitability, we will work on developing long-term modifications to our labor agreements, contract sales arrangements and raw materials supply strategy.”

Outlook—AK Steel said it expects continued improvements in its operating profitability for the third quarter and second half of 2004. The expected improvements are due primarily to anticipated higher selling prices and lower planned maintenance and overhead costs that, collectively, are expected to more than offset higher raw material costs.

Headquartered in Middletown, Ohio, AK Steel produces flat-rolled carbon, stainless and electrical steels, as well as tubular steel products for the automotive, appliance, construction and manufacturing markets.