US Steel’s president and chief executive officer David B Burritt predicts a robust steel market with no signs of slowing down in the short-term and resulting in strong earnings for the company in 2022.
The company has projected an EBITDA of $1.2bn with an adjusted net income of about $880mn excluding certain restructuring and asset impairment charges. The guidance is double of US Steel’s Q1 2021 EBITDA of $551mn and is driven by higher finished steel prices, strong flat steel demand, and improved operations.
Higher steel selling prices continue to be evident in spot sales and adjustable contracts for US Steel. The trend will support the steelmaker’s higher EBITDA outlook.
The fully ramped-up Phase 2 of BRS along with higher steel selling prices in the US and European markets are anticipated to contribute to higher EBITDA in Q2 2021 and the remainder of the year. Burritt also highlighted new sustainable non-grain-oriented electrical steel line cash investment at Big River Steel (BRS).
The tubular division is facing improved market conditions in the oil and natural gas segments and with added sales, is expected to achieve breakeven EBITDA in Q2 2021 compared to losses in 2020 quarters. The company is also consuming more internally produced round steel from the Fairfield, Arkansas plant that launched in late 2020.