US Steel has profitable Q2, but less so than 1 year earlier

Pittsburgh-based United States Steel Corp. recorded net earnings of $477 million in this year’s second quarter, down about 51 percent from the highly profitable $978 million earned in the second quarter of 2022.

The company’s net sales also have fallen by about 20 percent year on year, checking in at just more than $5 billion in this year’s second quarter compared with nearly $6.3 billion a year ago.

U.S. Steel President and CEO David B. Burritt expresses approval of the results, saying, “We are pleased to deliver strong results for the quarter, supported by healthy sequential growth in the Mini Mill segment in both adjusted earnings before interest taxes, depreciation and amortization [EBITDA] and EBITDA margin.”

The firm’s Mini Mill segment includes its sizable Big River Steel complex in Osceola, Arkansas, from where Burritt says additional products will emanate later this year.

“We are executing exceptionally well against our strategic initiatives, with all in-flight projects progressing on time and on budget,” Burritt says. “Notably, our nongrain-oriented, or NGO, electrical steel line at Big River Steel is currently being commissioned and on track to start up later in the third quarter. Customer demand has been robust for our NGO steels, and we are pleased to announce that we’ve already secured our first customer orders in both industrial and electric vehicle markets.”

The company’s most recent financial statement shows its Mini Mill segment contributed $144 million in earnings in the first half of this year, which is less than the $224 million earned by its Flat-Rolled segment, which includes the company’s North American blast furnace/basic oxygen furnace (BOF) mills.

However, the Flat-Rolled segment remains the larger of the two for U.S. Steel, having shipped out about 3.6 times more product in this year’s first half: about 4.5 million tons compared with 1.25 million tons shipped by the Mini Mill segment.

The comparative per-ton profitability could explain why U.S. Steel’s scrap-fed Mini Mill segment has operated at a 92 percent capability utilization (capacity) rate so far this year, while the BOF mills in the Flat-Rolled segment have averaged a lower 75 percent capacity rate.