PITTSBURGH - United States Steel Corporation (NYSE: NYSE:X) has announced its guidance for the first quarter of 2024, projecting adjusted net earnings per diluted share of $0.80 to $0.84. The company expects adjusted EBITDA to be around $425 million for the quarter.
The guidance reflects U.S. Steel's anticipation of a strong quarter, in line with previous expectations, buoyed by robust demand for steel and solid operational performance. President and CEO David B. Burritt highlighted the company's focus on executing its business strategy while progressing towards completing its transaction with Nippon Steel Corporation.
He noted that the diverse markets served by the North American Flat-Rolled segment contributed to a strong order book, while the Mini Mill segment benefited from higher-priced spot orders compared to the fourth quarter.
In Europe, U.S. Steel expects improved EBITDA over the previous quarter, driven by commercial and energy tailwinds as well as cost management initiatives. However, the Tubular segment is anticipated to face challenges with softer demand and pricing pressures, although it is still expected to maintain strong margins.
Looking ahead, Burritt mentioned the upcoming launch of the Big River Steel dual coating line in the second quarter and the new Big River 2 mini mill later in 2024. He expressed optimism about the future merger with Nippon Steel Corporation, aiming to create a leading steelmaker with world-class capabilities.
The Flat-Rolled segment's adjusted EBITDA is projected to rise compared to the fourth quarter, with higher spot steel prices contributing to increased average selling prices. This segment's performance is also expected to benefit from fixed-priced contracts negotiated for 2024, despite typical seasonal challenges in mining operations.
The Mini Mill segment is set to see a significant boost in adjusted EBITDA, nearly doubling the performance of the fourth quarter. This improvement is attributed to increased average selling prices, reflecting the segment's exposure to market-based monthly contracts and spot prices. However, this will be partially offset by higher raw material costs and approximately $20 million in construction-related costs.
The European segment is also expected to post higher adjusted EBITDA, with increased steel prices and reduced energy costs enhancing financial performance.
The company's Tubular segment, on the other hand, is projected to experience a decline in adjusted EBITDA due to lower selling prices and shipment volumes, influenced by stagnant rig counts and reduced natural gas demand following a mild winter.
This financial outlook is based on a press release statement from United States Steel Corporation.
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