Declining Steel Prices Impact AK Steel's Q2 Earnings

AK Steel’s net sales for the second quarter declined by 4 percent to about $1.68 billion due primarily to lower shipments to the slowing automotive market. Yet the steelmaker’s earnings for the quarter reached $66.8 million, an improvement from the $56.6 million in Q2 2018, though down from $72.9 million in the prior quarter. Hot rolled carbon spot market pricing dropped from $690 per ton to $555 per ton in the second quarter, shaving $5 million to $7 million from annual earnings with each $10 change in market price, the company said during its second-quarter conference call on Monday.

“We reported solid earnings for the second quarter despite a dramatic decline in carbon spot market pricing from a year ago. This reflects our strategy to focus on value-added products with fixed-price contracts and to deemphasize sales to the volatile commodity spot market,” said Roger K. Newport, Chief Executive Officer.