AK Steel Reports Third Quarter 1999 Results
21 October 1999
AK Steel Reports Third Quarter 1999 Results DM] MIDDLETOWN, OH USA 09/01/1999
MIDDLETOWN, Ohio, Oct. 21 -- AK Steel today
reported its results for the three months ended September 30, 1999, which give
effect to its recent merger with Armco Inc. utilizing the pooling of interests
method. AK Steel reported a net loss of $1.5 million, or $0.04 per diluted
share of common stock, including merger-related costs and special charges.
Excluding the merger-related costs and special charges, AK Steel earned
$40.1 million, or $0.37 per diluted share of common stock.
The merger-related costs and special charges, which totaled $51.6 million
on a pre-tax basis, or $38.8 million after-tax, included transaction fees and
expenses, payments required by change of control provisions in Armco's benefit
plans and the costs associated with conforming AK Steel's and Armco's methods
of pension accounting.
Revenues for the 1999 third quarter were nearly $1.06 billion on steel
shipments of 1,569,000 tons. For the corresponding period in 1998, combined
shipments totaled 1,423,000 tons, resulting in revenues of $959.7 million.
Operating profit before deduction of merger-related costs and special charges
was $87.1 million, or $56 per ton for the third quarter of 1999.
"We are pleased to welcome the former Armco shareholders to the AK Steel
family," said Richard M. Wardrop, Jr., chairman and chief executive officer.
"Our merger was completed within the aggressive schedule we established last
spring, and we have begun the important work of combining our operations and
workforces to take full advantage of the synergies created with this merger.
We also welcome the opportunity to continue providing the highest quality
products and service to our new customers."
AK Steel produces flat-rolled carbon, stainless and electrical steel
products for automotive, appliance, construction and manufacturing markets, as
well as standard pipe and tubular steel products. AK Steel is headquartered
in Middletown, Ohio. It employs about 11,500 men and women in plants and
offices in Middletown, Coshocton, Dover, Mansfield, Warren and Zanesville,
Ohio; Ashland, Kentucky; Rockport, Indiana; and Butler, Sharon and Wheatland,
Pennsylvania. AK Steel also produces snow and ice control products, and
operates a major industrial park on the Houston, Texas ship channel.
AK Steel Statement of Income & Earnings Per Share Data
(Dollars and Shares in Millions Except Per Share Data.)
Three Months Ended Nine Months Ended
September 30, September 30,
1999 1998 1999 1998
Shipments (000 tons) 1,569 1,423 4,942 4,456
Net Sales $1,055.5 $959.7 $3,193.3 $3,012.4
Cost of Products Sold 845.9 780.9 2,554.5 2,436.6
Selling and
Administrative
Expense 77.2 72.4 228.7 206.1
Depreciation 54.9 42.1 155.3 116.8
Special Charges and
Unusual Items 42.0 --- 42.0 ---
Total Operating Costs 1,020.0 895.4 2,980.5 2,759.5
Operating Profit 35.5 64.3 212.8 252.9
Interest Expense 29.2 20.2 89.2 62.2
Other Income 7.4 4.7 14.0 19.1
Income Before Income
Taxes 13.7 48.8 137.6 209.8
Income Tax Provision 12.5 16.7 53.3 71.6
Minority Interest 2.7 2.0 6.7 6.0
Income from Continuing
Operations (1.5) 30.1 77.6 132.2
Discontinued Operations --- --- 7.5 ---
Income before
Extraordinary Item
and Cumulative Effect
of a Change in
Accounting (1.5) 30.1 85.1 132.2
Extraordinary Items --- --- (13.4) ---
Cumulative Effect of a
Change in Accounting --- --- --- 133.9
Net Income (1.5) 30.1 71.7 266.1
Less Preferred Dividends 2.4 2.4 7.3 7.3
Net Income Applicable
to Common Stock $(3.9) $27.7 $64.4 $258.8
Earnings Per Share Data
(Dollars and Shares in Millions except Per Share Amounts)
Three Months Ended Nine Months Ended
September 30, September 30,
1999 1998 1999 1998
Basic Earnings Per Share:
Income from Continuing
Operations less
Preferred Dividends $(0.04) $0.28 $0.70 $1.24
Discontinued Operations --- --- 0.07 ---
Extraordinary Item --- --- (0.13) ---
Cumulative Effect of
Change in Accounting --- --- --- 1.33
Basic Earnings Per Share $(0.04) $0.28 $0.64 $2.57
Weighted Average Shares
Outstanding 101.2 100.4 101.0 100.7
Diluted Earnings Per Share:
Income from Continuing
Operations $(0.04) $0.28 $0.69 $1.22
Discontinued Operations --- --- 0.07 ---
Extraordinary Item --- --- (0.13) ---
Cumulative Effect of
Change in
Accounting --- --- --- 1.24
Diluted Earnings
Per Share $(0.04) $0.28 $0.63 $2.46
Weighted Average
Shares Outstanding 101.8 107.6 101.6 108.0