AK Steel misses by $0.04, misses on revs; lowers FY19 EPS guide (2.67 -0.05)
- Reports Q3 (Sep) earnings of $0.01 per share, $0.04 worse than the S&P Capital IQ Consensus of $0.05; revenues fell 11.5% year/year to $1.54 bln vs the $1.64 bln S&P Capital IQ Consensus.
- Co lowers guidance for FY19, sees EPS of $0.32-0.37 (from $0.37-0.44) vs. $0.41 S&P Capital IQ Consensus.
- In July, the company provided annual guidance based on carbon hot-rolled coil pricing of approximately $555 per ton. This annual guidance also indicated that for every $10 change in the carbon hot-rolled coil spot market price, annual earnings would be impacted by $5 to $7 million. However, since July, the pricing for carbon hot-rolled coil products has fallen more sharply than previously anticipated to an average of about $510 per ton for October. This decline has also caused service centers to order at minimum levels.
- The company expects the lower order volumes and the impact of the strike at General Motors (GM) to result in a reduction of flat-rolled steel shipments to between approximately 5.3 and 5.4 million tons for the full year. Further, these volatile events result in a deviation from the company's anticipated range of $5 to $7 million.
- The company now expects net income for the year to be in the range of $26 to $41 million, or $0.08 to $0.13 per diluted share.
- Excluding the effects of the first quarter 2019 Ashland Works charge of $77.4 million, the company also anticipates adjusted net income for the year to be in the range of $103 to $118 million, or $0.32 to $0.37 per diluted share, and adjusted EBITDA for the year to be in the range of $450 to $465 million.