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AK Steel Nets $92.7 Million for Second Quarter
MIDDLETOWN, Ohio -- AK Steel today reported net income of $92.7 million, or 85 cents per share of common stock, for the second quarter, compared to a net loss of $78.2 million, or 72 cents per share, in the second quarter of 2003.The second-quarter results include an after-tax gain of $44.2 million on the sale of the company's Houston industrial park, completed April 9, and a tax benefit related to discontinued operations of $27.2 million. The tax benefit was due to AK Steel's improved financial results and outlook, and reflects the use of net operating loss carryforwards that were previously expected to expire unused.AK Steel reported an operating profit of $56.4 million and income from continuing operations of $20.2 million, or 18 cents per share, in the second quarter compared to an operating loss of $115.2 million and a loss from continuing operations of $86.6 million, or 80 cents per share, in the year-ago period."AK Steel employees have earned well-deserved congratulations for helping us quickly reach an important milestone -- earning income from operations," says James L. Wainscott, president and chief executive officer. "Compared to where we were just nine months ago, that is a remarkable feat."Wainscott reiterates the company's focus on what he termed "the 3 C's," customers, costs and cash, for the first phase of the company's recovery. "Our attention to customers has helped restore and even increase business, resulting in higher volumes and record quarterly revenues," he says. "At the same time, we have made excellent progress in cost control and replenishing our cash position. As we move into the second phase of our return to sustainable profitability, we will work on developing long-term modifications to our labor agreements, contract sales arrangements and raw materials supply strategy."Net sales in the second quarter totaled $1,311.8 million on shipments of 1,565,100 tons, 34% and 12% higher, respectively, than in the second quarter of 2003.Increased global steel demand spurred the higher shipment volumes and increases in spot market pricing helped increase revenues, officials say. Steel prices also rose as a result of surcharges implemented to help offset unprecedented prices paid for certain raw materials and energy sources. The company's average flat-rolled selling price per ton reached a record $835 per ton in the second quarter, up 22% from $682 per ton in the second quarter of 2003 and nearly 12% higher than the $747 per ton average in the first quarter.For the first half of 2004, the company reported net sales of $2,446.2 million compared to $1,966.6 million in the first half of 2003. Operating profit for the first six months was $57.9 million compared to an operating loss of $158.3 million in the same period last year. First half net income of $258.1 million, or $2.37 per share, includes $246.3 million for the combined gain on the sale of Douglas Dynamics and Greens Port Industrial Park in Houston. For the same period in 2003, the company reported a net loss of $119 million, or $1.10 per share.Liquidity at the end of the second quarter totaled $735 million, including cash and availability under its two credit facilities, including an accounts receivable-based revolving credit facility established in May.Continued improvements are expected in the company's operating profitability for the third quarter and second half. The expected improvements are due primarily to anticipated higher selling prices and lower planned maintenance and overhead costs that, collectively, are expected to more than offset higher raw material costs.Visit AK Steel: www.aksteel.com"