U.S. Steel posts Q4 losses, announces over 1,500 job cuts in Michigan

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In its final quarterly report of the year, U.S. Steel last week cited a need to change to mitigate factors outside of its control.

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Changes have come of late in the form of job losses and plant closures. Last week, U.S. Steel announced the closure of a Michigan plant, leading to more than 1,545 layoffs at its Great Lakes Works plant in Ecorse, Michigan.

“We understand the impact today’s announcement to indefinitely idle Great Lakes Works has on many of our stakeholders, and we are acting now to reposition U. S. Steel around a footprint differentiated based on cost or capability,” President and CEO David B. Burritt said in the firm’s earnings release.

Burritt continued, acknowledging the steelmaker needs to adapt.

“While the current realities of the markets we serve are having a significant impact on our short-term results, we are taking swift action to align our operational footprint and financial strategy with our customers’ future to ensure we continue executing our ‘best of both’ integrated and mini-mill technology strategy,” Burritt continued.

“Fourth quarter expected results confirm the need to change to make the business more resistant to factors outside of our control. While the decisions being made are difficult, we believe they allow us to drive increased stockholder value as we move towards our future faster with a more capital efficient footprint.”

The steelmaker reported a loss of $25 million in the fourth quarter, citing weakness in its European and tubular segments. U.S. Steel forecast a diluted loss per share of $1.15 in the fourth quarter.

The steelmaker estimates full-year adjusted EBITDA of $682 million, excluding “approximately $285 million of estimated restructuring and other charges and approximately $47 million of estimated impacts from the December 24, 2018 fire at our Clairton coke making facility.”

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U.S. Steel shares dropped nearly 11% last Friday, down to $11.92 per share, following the earnings report and news of the Michigan layoffs.

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