AK Steel Holding Corp Earnings: Rising Revenue Helps Margins Expand

S&P 500 (NYSE:SPY) component AK Steel Holding Corp (NYSE:AKS) reported its results for the fourth quarter. AK Steel Holding is a holding company of AK Steel Corporation. The steelmaker makes such products as flat-rolled carbon, stainless and electrical steels, and aluminum-coated stainless steel.

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AK Steel Earnings Cheat Sheet for the Fourth Quarter

Results: Loss widened to $193.9 million ($1.76 per diluted share) from $98.3 million (loss of 89 cents per share) in the same quarter a year earlier.

Revenue: Rose 8.5% to $1.51 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: AKS reported an adjusted net loss of 26 cents per share. By that measure, the company beat the mean analyst estimate of a loss of 39 cents per share. Analysts were expecting revenue of $1.48 billion.

Quoting Management: “The economic recovery we’ve been anticipating for several years simply did not fully materialize in 2011 and we endured another round of raw material price increases,” said James L. Wainscott, Chairman, President and Chief Executive Officer of AK Steel. “However, we made significant strides towards becoming more self-sufficient in raw materials – moves that will greatly improve our cost structure in the future.”

Key Stats:

Revenue has risen the past four quarters. Revenue increased 0.6% to $1.59 billion in the third quarter. The figure rose 12.3% in the second quarter from the year earlier and climbed 12.5% in the first quarter from the year-ago quarter.

The company has now beaten estimates the last two quarters. In the third quarter, it topped expectations with net income of 2 cents versus a mean estimate of 0 cents per share.

Looking Forward: The outlook for the company’s results in the upcoming quarter is unfavorable. The average estimate for the first quarter of the next fiscal year is 9 cents per share, down from 22 cents ninety days ago. For the fiscal year, the average estimate has moved down from a profit of 42 cents a share to a loss of 2 cents over the last ninety days.

Competitors to Watch: Steel Dynamics, Inc. (NASDAQ:STLD), United States Steel Corp. (NYSE:X), Nucor Corporation (NYSE:NUE), Ternium S.A. (NYSE:TX), Commercial Metals Company (NYSE:CMC), Universal Stainless & Alloy Products (NASDAQ:USAP), Allegheny Tech. Inc. (NYSE:ATI), Ampco-Pittsburgh Corp. (NYSE:AP), ArcelorMittal (NYSE:MT), and Schnitzer Steel Industries, Inc. (NASDAQ:SCHN).

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

To contact the reporter on this story: Derek Hoffman at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com