June 2009 -- U.S. Steel saw earnings tumble from $290 million in the fourth quarter of 2008 to a net loss of $439 million in the first quarter of 2009. As a result, the company reduced the quarterly dividend by 25 cents per share to 5 cents per share, saving an estimated $116 million. Net sales for the quarter were $2.75 billion, compared to $4.5 billion in the fourth quarter of 2008 and nearly $5.2 billion in the first quarter of 2008.
"Weak customer demand for flat-rolled products, coupled with customers' efforts to reduce inventories, has resulted in very low order rates and further downward pressure on prices for our Flat-rolled and U.S. Steel Europe (USSE) segments," said Chairman and CEO John P. Surma. "Our tubular operations have also expeireinced a severe downturn primarily as a result of reduced drilling activity due to lower oil and gas prices, high inventory levels and unprecedented levels of unfairly traded and subsidized tubular imports from China."
The company's Flat-rolled business operated at 38 percent of raw-steel capacity in the first quarter of 2009 and shipments decreased 24 percent to 2.1 million net tons. First quarter Tubular results also decreased significantly from the fourth quarter of 2008, the company reported, due to lower shipments and average realized prices, idled facility carrying costs ($20 million for the first quarter) and the business' $18 million portion of the accrual for estimated future layoff benefits.
U.S. Steel reduced its planned capital spending for 2009 from $740 million to $410 million. The company also announced that it had reached an agreement with the United Steelworkers to defer $95 million in trust contributions for retiree health care and life insurance.
