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AK Steel Reports Profitable Third Quarter

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Price and shipment increases helped AK Steel record its best third quarter in a decade, reported the West Chester, Ohio-based steelmaker.

AK Steel registered net income of $67.2 million in the third quarter, up from $22.3 million in third-quarter 2017. Year-to-date net income was down 17.1 percent year over year, totaling $152.5 million at quarter’s end.

Third-quarter net sales totaled $1.7 billion, compared with $1.5 billion in the year-ago period. Through nine months, net sales were up 12.1 percent over last year to $5.1 billion.

“Our results represented our best third quarter performance in 10 years and reflected strong market conditions and our focus on value-added products,” said Roger Newport, CEO of AK Steel.  

The company credited higher steel selling prices and shipments for driving its third-quarter results, adding that these factors helped offset higher costs for certain raw materials, transportation and supplies, including graphite electrodes.

Shipments of flat-rolled steel totaled 1.42 million tons in the third quarter, up from 1.36 million tons in prior-year quarter. On the year, flat-rolled shipments were up 0.8 percent over last year, totaling 4.29 million tons at quarter’s end.

In the fourth quarter, flat-rolled steel shipments should stay flat, according to the company. AK Steel expects the seasonal slowdown in automotive shipments to be offset by strong demand from the distributors and converters market, including spot market opportunities. However, the company said increased shipments into the distributors and converters market will reduce average selling prices by 2 to 3 percent.

“We expect market conditions to remain positive, which should be reflected in selling prices and support continued strong performance in the fourth quarter and 2019 fiscal year,” Newport said.