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Researched by Industrial Info Resources (Sugar Land, Texas)--United States Steel Corporation (U.S. Steel) (NYSE:X) (Pittsburgh, Pennsylvania) remains focused on its $1.6 billion, multi-year flat-rolled asset revitalization program through 2020, with plans to ramp up spending in 2018.
The steel firm plans to spend between $450 million and $500 million on the program next year, up from between $200 million and $250 million in 2017, according to the company's third-quarter 2017 earnings presentation. The balance of the program will be spent in 2019 and 2020.
The revitalization program will increase slab production capability by about one million tons by 2020, or roughly 10% more than what is expected for 2017, the company said.
In the near term, the company said it plans to complete $35 million in revitalization projects to improve reliability at its Gary Works facilities in Indiana and Great Lakes works operations in Ercose, Michigan. For related information, see Industrial Info's project reports for the Gary Steel Works 2017 maintenance program and the Great Lakes Steel Works melt shop 2018 maintenance shutdowns.
U.S. Steel says the multi-year timeline for the revitalization program will minimize operational disruptions.
"Importantly, while this is a large program, the majority of projects are not large, complex projects," the company said in its earnings release. "This means that projects are easier to execute. Due to the smaller nature of many of the projects, we do not have to complete the entire program in order to start seeing benefits. Also, by breaking the program down into a series of smaller projects, we have greater flexibility to adjust the scope and pace of project implementation, based on changes in business conditions."
The company has earmarked $200 million for iron-making improvements, $400 million for steel making, $300 million for hot-rolling operations and $300 million for finishing operations over the course of the program.
"Just to be clear, this is a revitalization program, it's not like our assets are in terrible shape. We're bringing them up to superior levels," Chief Executive Officer David Burritt told investment analysts during the company's third-quarter earnings presentation.
For 2017, U.S. Steel expects maintenance and outage expenses for its flat-rolled segment to be about $1.32 billion, up from the $950 million that was spent in 2016. This includes all normal maintenance and outage expenses, as well as those related to the asset revitalization program.
The company also made note of a new continuous galvanizing line project to produce its "Generation 3" steels. U.S. Steel and Kobe Steel Limited (Tokyo, Japan) plan to build a 500,000-ton-per-year line at their PRO-TEC Coating Company joint venture plant in Leipsic, Ohio. The line will serve the domestic auto industry and represents an investment of about $400 million. For more information, see Industrial Info's project report and September 27, 2017, article -- U.S. Steel, Kobe Steel to Build New Galvanizing Line at Ohio Plant.
U.S. Steel reported $147 million in net earnings for third-quarter 2017, compared with $51 million in third-quarter 2016. The results for the just-ended quarter included a $95 million favorable impact related to a change in accounting method for property, plant and equipment. Net sales for the quarter totaled $3.2 billion, up from nearly $2.7 billion in third-quarter 2016.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
The steel firm plans to spend between $450 million and $500 million on the program next year, up from between $200 million and $250 million in 2017, according to the company's third-quarter 2017 earnings presentation. The balance of the program will be spent in 2019 and 2020.
The revitalization program will increase slab production capability by about one million tons by 2020, or roughly 10% more than what is expected for 2017, the company said.
In the near term, the company said it plans to complete $35 million in revitalization projects to improve reliability at its Gary Works facilities in Indiana and Great Lakes works operations in Ercose, Michigan. For related information, see Industrial Info's project reports for the Gary Steel Works 2017 maintenance program and the Great Lakes Steel Works melt shop 2018 maintenance shutdowns.
U.S. Steel says the multi-year timeline for the revitalization program will minimize operational disruptions.
"Importantly, while this is a large program, the majority of projects are not large, complex projects," the company said in its earnings release. "This means that projects are easier to execute. Due to the smaller nature of many of the projects, we do not have to complete the entire program in order to start seeing benefits. Also, by breaking the program down into a series of smaller projects, we have greater flexibility to adjust the scope and pace of project implementation, based on changes in business conditions."
The company has earmarked $200 million for iron-making improvements, $400 million for steel making, $300 million for hot-rolling operations and $300 million for finishing operations over the course of the program.
"Just to be clear, this is a revitalization program, it's not like our assets are in terrible shape. We're bringing them up to superior levels," Chief Executive Officer David Burritt told investment analysts during the company's third-quarter earnings presentation.
For 2017, U.S. Steel expects maintenance and outage expenses for its flat-rolled segment to be about $1.32 billion, up from the $950 million that was spent in 2016. This includes all normal maintenance and outage expenses, as well as those related to the asset revitalization program.
The company also made note of a new continuous galvanizing line project to produce its "Generation 3" steels. U.S. Steel and Kobe Steel Limited (Tokyo, Japan) plan to build a 500,000-ton-per-year line at their PRO-TEC Coating Company joint venture plant in Leipsic, Ohio. The line will serve the domestic auto industry and represents an investment of about $400 million. For more information, see Industrial Info's project report and September 27, 2017, article -- U.S. Steel, Kobe Steel to Build New Galvanizing Line at Ohio Plant.
U.S. Steel reported $147 million in net earnings for third-quarter 2017, compared with $51 million in third-quarter 2016. The results for the just-ended quarter included a $95 million favorable impact related to a change in accounting method for property, plant and equipment. Net sales for the quarter totaled $3.2 billion, up from nearly $2.7 billion in third-quarter 2016.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
