AKS AK Steel Holding Corp

In the news release, AK Steel Reports Fourth Quarter and Full-Year 2011 Financial Results, issued Jan. 24, 2012 by AK Steel over PR Newswire, in the table CONSOLIDATED STATEMENTS OF CASH FLOWS, under the column heading "Twelve Months Ended, December 31, 2011" PR Newswire omitted a digit from the last line item "Cash and cash equivalents, end of period". The number should read "42.0" rather than "2.0" as incorrectly transmitted by PR Newswire. The complete, corrected release follows:

AK Steel Reports Fourth Quarter and Full-Year 2011 Financial Results

 

WEST CHESTER, Ohio, Jan. 24, 2012 /PRNewswire/ -- AK Steel (NYSE: AKS) today reported a net loss of $193.9 million, or $1.76 per diluted share of common stock, for the fourth quarter of 2011, compared to a net loss of $98.3 million, or $0.89 per diluted share, for the fourth quarter of 2010.  The 2011 fourth quarter results include a non-cash pre-tax pension corridor charge of $268.1 million, or $1.50 per diluted share.  Excluding this amount, the company's adjusted net loss for the fourth quarter of 2011 was $28.0 million, or $0.26 per diluted share.

Net sales for the fourth quarter of 2011 were $1,509.2 million on shipments of 1,409,900 tons, compared to sales of $1,390.6 million on shipments of 1,359,900 tons for the year-ago fourth quarter.  The company said its average selling price for the fourth quarter of 2011 was $1,070 per ton, approximately 5% higher than the $1,022 per ton reported for the fourth quarter of 2010, but an approximate 8% decrease from the $1,158 per ton for the third quarter of 2011.

The company reported an operating loss for the fourth quarter of 2011 of $300.7 million, which includes the $268.1 million pre-tax pension corridor charge.  Excluding the pension corridor charge, the company's adjusted operating loss for the fourth quarter of 2011 was $32.6 million, or $23 per ton.  The 2011 fourth quarter results also include a LIFO credit of $44.1 million.  The company reported an operating loss of $154.6 million, or $114 per ton, for the fourth quarter of 2010.  The 2010 fourth quarter results include a $63.7 million pre-tax charge related to the shutdown of the company's Ashland (KY) coke plant, and a $9.1 million pre-tax charge related to a retiree benefit settlement associated with the company's Butler (PA) Works.

"The economic recovery we've been anticipating for several years simply did not fully materialize in 2011 and we endured another round of raw material price increases," said James L. Wainscott, Chairman, President and Chief Executive Officer of AK Steel.  "However, we made significant strides towards becoming more self-sufficient in raw materials – moves that will greatly improve our cost structure in the future."  In October of 2011, AK Steel made strategic investments in iron ore and metallurgical coal, two of the most important raw materials the company utilizes in its steelmaking operations.

Full-Year 2011 Results

For the full year, AK Steel reported a net loss of $155.6 million, or $1.41 per diluted share, compared to a net loss of $128.9 million, or $1.17 per diluted share for 2010.  The results for 2011 include the non-cash pre-tax pension corridor charge of $268.1 million, or $1.50 per diluted share, previously described.  Excluding this amount, the company's adjusted net income for 2011 was $10.3 million, or $0.09 per diluted share.  The results for 2010 include a non-cash charge of $25.3 million, or $0.23 per diluted share, related to federal healthcare legislation, as well as a $63.7 million pre-tax charge related to the shutdown of the company's Ashland (KY) coke plant, and a $9.1 million pre-tax charge related to a retiree benefit settlement associated with the company's Butler (PA) Works.  

Sales for 2011 were $6,468.0 million, an increase of 8% compared to $5,968.3 million for 2010.  Shipments for 2011 were 5,698,800 tons, a slight increase compared to 5,660,900 tons in 2010.  The company reported an operating loss of $201.3 million, or $35 per ton, for 2011 which was largely a result of the pension corridor charge, compared to an operating loss of $133.9 million, or $24 per ton, for 2010.  Excluding the pension corridor charge, the company's adjusted operating profit for the full year of 2011 was $66.8 million, or $12 per ton.

First Quarter 2012 Outlook

Due to continued uncertainty and volatility with respect to economic conditions in the U.S. and in other markets served by the company, AK Steel is not providing an outlook for the company's first quarter results at this time.  However, the company said that it expects to provide first quarter guidance in March. 

Use of Non-GAAP Financial Measures

In certain of its disclosures in this news release, the company has adjusted its operating profit (loss) and net income (loss) to exclude a pension corridor accounting charge. Reporting adjusted operating profit or loss and net income or loss (either as a total or on a per-ton basis) is not a financial measure under generally accepted accounting principles ("GAAP"). The company has made this adjustment, however, because Management believes that it enhances the understanding of the company's financial results.  The company believes that this method of accounting for pension and other postretirement obligations is not typically used by other publicly traded companies.  In addition, although it reduces reported operating and net income, it is a non-cash charge.  Disclosing adjusted operating profit (loss) and net income (loss) with the corridor charge excluded from the actual quarterly results facilitates the ability of an investor to compare the company's actual results to its competitors and other publicly traded companies. Neither current shareholders nor potential investors in the company's securities should rely on adjusted operating profit (loss) or adjusted net income (loss) as a substitute for any GAAP financial measure and the company encourages investors and potential investors to review the reconciliation below of adjusted operating profit (loss) and net income (loss) to the comparable GAAP financial measure.

The following schedule reflects the reconciliation of the non-GAAP quarterly financial measures discussed in this news release:

 

Safe Harbor Statement

The statements in this release with respect to future results reflect management's estimates and beliefs and are intended to be, and hereby are identified as "forward-looking statements" for purposes of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.  Words such as "expects," "anticipates," "believes," "intends," "plans," "estimates" and other similar references to future periods typically identify such forward-looking statements.  The company cautions readers that such forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those currently expected by management, including those risks and uncertainties discussed in the company's Annual Report on Form 10-K for the year ended December 31, 2010, as updated in our subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with or furnished to the Securities and Exchange Commission. Except as required by law, the company disclaims any obligation to update any forward-looking statements to reflect future developments or events.

AK Steel

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 6,200 men and women in Middletown, Mansfield, Coshocton and Zanesville, Ohio; Butler, Pennsylvania; Ashland, Kentucky; Rockport, Indiana; and its corporate headquarters in West Chester, Ohio.  Additional information about AK Steel is available on the company's web site at www.aksteel.com.

AK Tube LLC, a wholly-owned subsidiary of AK Steel, employs about 300 men and women in plants in Walbridge, Ohio and Columbus, Indiana.  AK Tube produces carbon and stainless electric resistance welded (ERW) tubular steel products for truck, automotive and other markets.  Additional information about AK Tube LLC is available on its web site at www.aktube.com.

AK Coal Resources, Inc., another wholly-owned subsidiary of AK Steel, owns or leases metallurgical coal reserves in Somerset County, Pennsylvania.  AK Steel also owns 49.9% of Magnetation LLC, a joint venture headquartered in Grand Rapids, Minnesota, which produces iron ore concentrate from previously mined ore reserves.

 

 

 

 

 

 

SOURCE AK Steel