United States Steel Corporation (X) has experienced a decline of 4.68% in the premarket. However, the last trading session concluded at $22.44 with an increase of 2.47%.
United States Steel Corporation (X) announced Deleveraging Update
X provided Third Quarter 2021 Guidance and Deleveraging Update on 17th September 2021. The company also provided an update on the year’s deleveraging activity. The X Company has decreased its debt by roughly $2.7 billion years to date.
The Company announced in June that it would redeem $718 million in aggregate principal amount of its outstanding 6.875 percent Senior Notes due 2025, which it did in August. The company established an additional deleveraging objective of up to $1 billion by mid-2022 in July. By month’s end, the Company expects to have completed roughly half of its incremental deleveraging objective by taking the following steps:
- $180 million of 6.625 percent Big River Steel Senior Secured Notes due 2029 will be redeemed; and
- US Steel Senior Notes due 2026, with a 6.25 percent coupon, will be redeemed for $370 million.
Site Selection Process
On 17th September 2021, X initiated an exploratory site selection process to develop a new state-of-the-art micro mill in the United States. The Board of Directors of US Steel has approved an exploratory site selection process for a new three-million-ton micro mill flat-rolled factory. The projected small mill will include acquired equipment as well as two state-of-the-art electric arc furnaces (EAF) with specialized steelmaking and finishing technologies.
Greenfield sites as well as areas where the Company already has EAF operations are all possibilities. The current investment estimate is around $3.0 billion, with the majority of the money coming from existing cash and projected free cash flow. The eventual location selection and extent of value-added downstream finishing assets will determine the final investment required.
Second Quarter 2021 Financial results
X announced second-quarter 2021 financial results on 30th July 2021. United States Steel Corporation reported $1,012 million in second-quarter net profits. X company reported $964 million in adjusted net income of $3.37 per diluted share. Moreover, X company lost $469 million, or $2.67 per diluted share, on an adjusted basis.
The company achieved record-adjusted EBITDA margins, demonstrating the value of having both an integrated and a small-mill footprint. Its financial strength allows announcing additional debt reductions of up to $1 billion over the following 12 months.
