AK Steel, Schnitzer Steel Earnings Rise Amid Lower Costs
October 25 2016 - 10:40AM
Dow Jones News
AK Steel and Schnitzer Steel Industries Inc. both reported
stronger earnings Tuesday as the companies benefited from
cost-cutting measures.
Shares of AK Steel rose 8% to $5.60 and Schnitzer Steel rose
6.4% to $24.90 in early trading.
U.S. steelmakers had been hurt by low prices as the result of a
glut of capacity and high levels of less expensive imports. The
government's import tariffs this year also have been a factor in
improved results at several big steel companies in recent
quarters.
Over all, AK Steel reported a third-quarter profit of $50.9
million, or 21 cents a share, up sharply from $6.7 million, or 4
cents a share, a year earlier. Revenue decreased 15% to $1.45
billion as shipments fell 24%, partly related to the company's
decision to focus less on less profitable commoditized
products.
Analysts polled by Thomson Reuters expected per-share profit of
13 cents and revenue of $1.47 billion.
Total operating expenses fell 19%.
For the three-month period ended Aug. 31, Schnitzer reported a
profit of $16.1 million, or 58 cents a share, up from $10.7
million, or 39 cents a share, a year earlier. Excluding items,
adjusted per-share earnings from continuing operations rose to 60
cents from 31 cents.
The latest quarter included a previously disclosed insurance
reimbursement linked to legal and other costs associated with an
environmental matter of 21 cents a share. Excluding items, the
steelmaker and metal recycler had expected adjusted per-share
earnings from continuing operations of 56 cents to 60 cents.
Revenue dropped 15% to $390.7 million, above analysts' estimates
for revenue of $389.8 million.
Overhead costs declined 20%.
Write to Tess Stynes at tess.stynes@wsj.com
(END) Dow Jones Newswires
October 25, 2016 10:25 ET (14:25 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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