U.S. Steel’s Q2 2016 Earnings Review: Cost Reduction Initiatives Boost Results Amid Weakness In Steel Prices
U.S. Steel reported much improved Q2 2016 results with its adjusted net loss narrowing considerably year-over-year. The improved results are largely due to the company’s ongoing initiative (‘The Carnegie Way’) to rationalize costs and boost the efficiency of its operations. Projects under ‘The Carnegie Way’ initiative are expected to translate into margin improvement to the tune of $645 million in 2016. Though U.S. Steel’s realized steel prices for its U.S. Flat-rolled operations have improved considerably sequentially, partly as a result of regulatory intervention in the form of the imposition of antidumping duties on imported steels, prices are still lower on a year-over-year basis. Moreover, weak demand conditions in Europe still weigh on the realized prices of the U.S. Steel Europe division. Furthermore, a decline in oil and gas drilling activity (as a result of a decline in crude oil prices) has dampened the demand for tubular steels and the U.S. Tubular division’s business prospects.
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- Why We Are Cutting Our Price Estimate For U.S. Steel Stock
- How Will U.S. Steel Stock Fare In An Uncertain Economy?
Have more questions about U.S. Steel? See the links below.
- What Is U.S. Steel’s Revenue And EBITDA Breakdown?
- What Is U.S. Steel’s Fundamental Value Based On Expected 2015 Results?
- How Has U.S. Steel’s Revenue Composition Changed Over The Last 5 Years?
- By What Percentage Did U.S. Steel’s Revenue & EBITDA Change In The Last 5 Years?
- By What Percentage Can U.S. Steel’s Revenue & EBITDA Grow In The Next 3 Years?
- How Has The Increase In Steel Imports To The U.S. Impacted U.S. Steel’s U.S. Flat-Rolled Steel Operations?
- How Has The Decline In Oil Prices Impacted U.S. Steel’s Tubular Steel Shipments?
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