AK Steel Holding Corp. (NYSE:AKS) has posted first-quarter results that handily beat analyst estimates and expects market conditions to strengthen in the second quarter.
AK Steel reported net income for the first quarter of US$28.7mln, or $US0.09 a share, down 66% from net income of US$84.4mln, or US$0.26 a share, in the first quarter of 2017. Nonetheless, per-share earnings in the latest first quarter beat the consensus estimate of $0.01 a share of 15 analysts surveyed by Yahoo Finance.
Revenue at the Ohio-based steelmaker rose 8.5%, to US$1.66bn from US$1.53bn. Yahoo Finance put the average revenue estimate of 11 analysts at US$1.57bn.
“Our first-quarter 2018 operating performance benefited from a favorable pricing environment and solid demand across most end markets, including automotive,” Roger K. Newport, CEO of AK Steel, said.
"We remain optimistic about 2018, as we expect automotive and other key end use markets to remain strong," Newport said. The CEO also said the high level of imports "remains a challenge and we will continue to work proactively with the Trump administration to ensure fair and appropriate trade policies."
AK Steel said it anticipates market conditions will strengthen in the second quarter compared to the first quarter, with shipments of flat-rolled steel up 5% to 7% from the first quarter of 2018 and the average selling per flat-rolled ton rising to $1,075 in the second quarter from $1,045 in the first quarter.
As a result of anticipated improvement in pricing and volumes, AK Steel expects its second-quarter adjusted EBITDA margin to improve by 1.5 to 2.0 percentage points from the first quarter of 2018.
Despite the optimistic outlook offered by AK Steel, its shares were down around 5% after the open Monday, to $US4.50 a share.