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Wheeling-Pittsburgh Revises Second-Quarter Expectations
07/02/2007 - Unplanned outages, high scrap costs, and sluggish demand for flat-rolled products are prompting Wheeling-Pittsburgh to lower its second-quarter earnings expectations.
Unplanned outages, high scrap costs, and sluggish demand for flat-rolled products are prompting Wheeling-Pittsburgh Corp. to lower its second-quarter earnings expectation.
Although June is not quite completed, the company says it expects that the second-quarter EBITDA loss will be approximately $25 million, after including the favorable effect of a $9.5 million business interruption insurance recovery.
The company says the second quarter has been significantly impacted by unplanned EAF and BOF outages during April, as well as increased scrap costs and weaker demand for flat rolled products. The lingering impact of the unplanned outages and the fact that the expected rebound in market conditions did not materialize contributed to the shortfall.
"While this quarter will represent an improvement from the first quarter's results, it is still well below our expectations," commented James P. Bouchard, Chairman and CEO.
The company also announced a two-week maintenance outage on its electric arc furnace during July. The outage—which had been planned for some time—will overlap the same challenging commercial conditions that impacted the second quarter. The outage, which will coincide with other planned maintenance at the company's Mingo Junction facility, could reduce productive capacity during the period by as much as 40,000 tons.
The registration statement for the company's combination with Esmark Inc. continues to go through the standard review process with the Securities and Exchange Commission. The company says it is working toward a shareholder vote in the third quarter of this year.
Wheeling-Pittsburgh is a steel company engaged in the making, processing and fabrication of steel and steel products using both integrated and electric arc furnace technology. Products include hot- and cold-rolled sheet and coated products such as galvanized, pre-painted and tin mill sheet. The company also produces a variety of steel products including roll-formed corrugated roofing, roof deck, floor deck, bridgeform and other products used primarily by the construction, highway and agricultural markets.
