An aerial shot of Gary Works with the U.S. Steel Yard in the foreground. Provided image
U.S. Steel was the world's first billion-dollar company.
Now the Pittsburgh-based steelmaker, buoyed with strong demand and record prices, pulled in twice that amount in profit in a single quarter.
U.S. Steel doubled its quarterly profit to $2.002 billion, or $6.97 per share, in the third quarter, which could result in a windfall of profit-sharing checks for Northwest Indiana steelworkers. U.S. Steel made $1 billion in the second quarter when it paid out record profit-sharing bonuses of $9,400.
“We continue setting records, including record net earnings, record EBITDA, record EBITDA margin, record liquidity, record safety, and record quality and reliability,” said U. S. Steel President and CEO David Burritt. “Our balance sheet has been transformed and the cash flow generation of the business has us highly confident in our ability to pre-fund organic growth investments that will expand our existing competitive advantages. We are getting to our 'Best for All' future faster.”
The steelmaker, one of the Region's largest employers, pulled in adjusted EBITDA of $2.027 billion and adjusted net earnings of $1.543 billion, or $5.36 per diluted share, in the third quarter. It now has liquidity of $4.5 billion, including $2 billion in cash.
In the third quarter of last year, U.S. Steel posted a net loss of $234 million or $1.06 per share.
U.S. Steel's flat-rolled division made $1 billion in the third quarter, as compared to a loss of $159 million in the third quarter of last year.
“It's not either investing in our business or returning capital directly to stockholders, it's both," Burritt said. "Our future now includes a $300 million stock repurchase program and 5% per share quarterly dividend to begin directly rewarding stockholders for the progress we have made so far.
"We are confident in the long-term value our new, highly capable mini mill will create as it further expands our competitive advantage to produce sustainable and differentiated steel.”
U.S. Steel will pay a quarterly dividend of 5 cents per share, a 400% increase over the previous quarter. The steelmaker plans to return more value to shareholders by buying back $300 million in stock.
“Today’s announcement demonstrates the significant progress we have made in the execution of our 'Best for All' strategy,” Burritt said. “We have made substantial progress on our announced deleveraging plans and expect to complete our incremental $1.0 billion target by the end of the year and ahead of schedule. Our expected $3.1 billion of total 2021 deleveraging combined with our robust cash and liquidity position has also allowed us to confidently begin executing organic growth investments aligned with long-term value creation. Today’s capital allocation enhancements further affirm our bullish outlook for the long-term future of U. S. Steel, are attractive uses of capital and demonstrate that our strategy is truly best for all by ensuring our stockholders directly benefit from the company’s continued success.”
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