AK Steel reports net loss in Q1
By Metal Center News Staff
on Apr 30, 2019
AK Steel reported a net loss of $4.5 million in the first quarter, compared with net income of $28.7 million in the year-ago period. Excluding a $77.4 million charge for the Ashland Works closure, the West Chester, Ohio-based steelmaker’s adjusted net income was $72.9 million.
The company also reported sales of $1.7 billion in the quarter, a 2 percent increase from first-quarter 2018.
“Our solid first quarter operating performance benefitted from our annual customer contract renewals,” CEO Roger Newport said. “A higher proportion of contractual sales helps to reduce the volatility in our business and this was reflected in our first quarter results. We also continued to strengthen our position with automotive manufacturers by commercializing new steel solutions, including through our downstream tubing and stamping operations.”
In January, AK Steel announced plans to close its Ashland Works facility, including a blast furnace and steelmaking operations that were idled in December 2015 and a hot dip galvanizing coating line that has remained operational. The company said it is transitioning its products to other U.S. coating lines and will close the Ashland Works line before the end of 2019.
AK Steel recorded a charge of $77.4 million during the first quarter of 2019 for termination of certain take-or-pay supply agreements, supplemental unemployment and other employee benefit costs, pension and OPEB termination benefits, estimated multiemployer plan withdrawal liability, and other costs.
The company also updated its annual guidance. AK Steel now expects net income to be in the range of $76 to $96 million.