U.S. Steel Posts Narrower Loss

U.S. Steel Corp. posted a narrower net loss and improved its full-year guidance for a key earnings metric.

The Pittsburgh company said its European segment posted its best results since the third quarter of 2008, its flat-rolled segment returned to profitability, and an improving cost structure has helped margins.

Second-quarter revenue fell 11% from a year ago to $2.58 billion, compared with the $2.68 billion that Wall Street analysts expected.

Pricing increases contributed to a strong quarter, and more price improvement is expected in the second half of the year.

Under current market conditions, the company expects about $850 million in adjusted earnings before interest, taxes, depreciation and amortization for the full year, compared with its April outlook of nearly $400 million. The company expects earnings per share of about 34 cents.

Shares rose 4.6% to $24 in late trading.

U.S. Steel cut thousands of jobs as the industry suffered from oversupply and a glut of imports, but new U.S. import tariffs have helped the industry recently.

Overall, U.S. Steel reported a loss of $46 million, or 32 cents a share, compared with a loss of $261 million, or $1.79 a share, a year earlier.

Excluding items, the company had a loss of 31 cents a share, compared with a loss of 79 cents a share a year earlier. Analysts polled by Thomson Reuters had projected a loss excluding items of 49 cents a share.

U.S. Steel Chief Executive Mario Longhi said in April that the company expected rising prices and a pickup in demand in the second quarter, especially in the automotive market.

Mr. Longhi said in a statement Tuesday that "the significant improvements we have made to our earnings power through our Carnegie Way transformation will become more apparent as market prices recover from the very low levels at the end of 2015." He said the industry is still facing "global overcapacity and unfair trade practices."

U.S. Steel results follow AK Steel Holding Corp.'s report that it swung to a second-quarter profit as it reduced its exposure to spot prices and focused on more profitable coated products. Meanwhile, Nucor Corp.'s profit rose 87%.

In an April complaint filed with the International Trade Commission, U.S. Steel demanded penalties on Chinese steel imports and said Chinese steelmakers conspired to fix prices and stole trade secrets.

Write to Josh Beckerman at [e-mail]

(END) Dow Jones Newswires

July 26, 2016 18:55 ET (22:55 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.