Exhibit 99.1

United States Steel Corporation
Public Affairs
600 Grant Street
Pittsburgh, PA 15219-2800
 
News
 


Contacts:    Media
Courtney Boone
(412) 433-6791
Investors/Analysts                                             Dan Lesnak
(412) 433-1184
FOR IMMEDIATE RELEASE
UNITED STATES STEEL CORPORATION REPORTS
2014 SECOND QUARTER RESULTS AND IMPROVING THIRD QUARTER OUTLOOK

Total reportable segment and Other Businesses income from operations of $132 million
Net loss of $18 million, or $0.12 per diluted share; adjusted net income of $25 million, or $0.17 per diluted share
Cash from operations of $0.8 billion; total liquidity of $3.2 billion, including $1.5 billion of cash
PITTSBURGH, July 29, 2014 – United States Steel Corporation (NYSE: X) reported second quarter 2014 net loss of $18 million, or $0.12 per diluted share, compared to a second quarter 2013 net loss of $78 million, or $0.54 per diluted share, and first quarter 2014 net income of $52 million, or $0.34 per diluted share. Adjusted net income for the second quarter of 2014 was $25 million, or $0.17 per diluted share, excluding a charge of $46 million, or $0.31 per diluted share, for litigation reserves; a loss on assets held for sale of $9 million, or $0.06 per diluted share; and a curtailment gain of $12 million, or $0.08 per diluted share. See the Non-GAAP Financial Measures section for a description of the non-GAAP measures and a reconciliation to net income (loss) attributable to U. S. Steel.


2


Earnings Highlights
 
(Dollars in millions, except per share amounts)
2Q 2014
1Q 2014
2Q 2013
Net Sales
$
4,400

$
4,448

$
4,429

Segment income (loss) from operations




     Flat-rolled
$
30

$
85

$
(51
)
     U. S. Steel Europe
38

32

10

     Tubular
47

24

45

     Other Businesses
17

13

43

Total reportable segment and Other Businesses income from operations
$
132

$
154

$
47

Postretirement benefit expense
(32
)
(32
)
(54
)
Other items not allocated to segments
(65
)


Income (loss) from operations
$
35

$
122

$
(7
)
Net interest and other financial costs
64

69

68

Income tax (benefit) provision
(11
)
1

3

Less: Net loss attributable to the noncontrolling interests



Net (loss) income attributable to United States Steel Corporation
$
(18
)
$
52

$
(78
)
-Per basic share
$
(0.12
)
$
0.36

$
(0.54
)
-Per diluted share
$
(0.12
)
$
0.34

$
(0.54
)
Commenting on results, U. S. Steel President and CEO Mario Longhi said, “The Carnegie Way journey continues to drive improvements as we reported operating income for each of our reportable segments and Other Businesses despite significant operating inefficiencies and logistical issues in our Flat-rolled segment.”
The $132 million, or $26 per ton, of reportable segment and Other Businesses income from operations for the second quarter of 2014 compares to income from operations of $154 million, or $30 per ton, in the first quarter of 2014 and income from operations of $47 million, or $9 per ton, in the second quarter of 2013.
Other items not allocated to segments in the second quarter of 2014 consisted of a pre-tax charge of $70 million for litigation reserves, a pre-tax loss of $14 million on assets held for sale and a pre-tax curtailment gain of $19 million.
As of June 30, 2014, U. S. Steel had $1.5 billion of cash and $3.2 billion of total liquidity. Cash provided by operating activities was $1.4 billion in the first half of 2014 primarily due to improved working capital management. During the second quarter, we repaid the remaining $322 million of our 2014 Senior Convertible Notes.
Reportable Segments and Other Businesses
Results for our Flat-rolled segment remained positive but decreased significantly from the first quarter. The impacts of the extraordinary weather conditions and operational issues that began in the first quarter resulted in continuing operating inefficiencies; higher repairs and maintenance costs; and logistical issues that


3


temporarily limited our production capabilities during the second quarter. These events resulted in both higher operating costs and lower shipments as compared to the first quarter. Market conditions in North America did improve versus the first quarter, resulting in higher average realized proceeds in the second quarter. The benefits generated by our Carnegie Way efforts partially offset the impact of these events and allowed us to report positive results. As we exited the second quarter, we returned to normal operations.
We reported comparable results for our European segment in the second quarter despite the absence of the sale and swap of carbon emission allowances recognized in the first quarter. Iron ore costs declined while shipments and average realized prices were comparable to the first quarter.
Tubular results increased compared to the first quarter. Shipments were higher due to increased drilling activity while average realized prices were in line with the first quarter. Raw materials costs improved as compared to the first quarter.
Outlook     
Commenting on U. S. Steel's outlook for the third quarter, Longhi said, “We expect operating income for our reportable segments and Other Businesses to increase significantly over the second quarter, as we return to normal operating levels. We continue to earn the right to grow as the Carnegie Way transformation allows us to better meet our customers' needs and improves our earnings power. ”
Results for our Flat-rolled segment are expected to improve significantly from the second quarter. Shipments are projected to increase as we return to normal operations while average realized prices are expected to remain consistent with the second quarter. The absence of weather related and operational challenges experienced during the second quarter is expected to generate a favorable impact of approximately $150 million from reduced repairs and maintenance costs and increased operating efficiencies along with the increased shipments described above. Inventory levels are expected to increase during the balance of the year as we work to replenish our supply chain.
We expect results for our European segment to decrease as compared to the second quarter. Scheduled caster and blast furnace maintenance along with the normal impact of the European holiday season is expected to result in lower shipments and higher repairs and maintenance costs related to the planned outages. These negative impacts are expected to be partially offset by a decrease in raw materials costs, primarily for iron ore. Averaged realized prices are projected to be in line with the second quarter.
Tubular results are expected to improve slightly as compared to the second quarter. Shipments are expected to decrease, due to the indefinite idling of the McKeesport and Bellville facilities, while average realized


4


prices are projected to increase due to improved pricing and mix. Because the International Trade Commission (ITC) ruling on the OCTG trade case is expected in mid-August, we do not anticipate any benefit for the third quarter.
    
*****
This release contains forward-looking statements with respect to market conditions, operating costs, shipments and prices. Factors that could affect market conditions, costs, shipments and prices for both North American and European operations include: (a) foreign currency fluctuations and related activities; (b) global product demand, prices and mix; (c) global and company steel production levels; (d) plant operating performance; (e) natural gas, electricity, raw materials and transportation prices, usage and availability; (f) international trade developments, including court decisions, legislation and agency decisions on petitions and sunset reviews; (g) the impact of fixed prices in energy and raw materials contracts (many of which have terms of one year or longer) as compared to short-term contract and spot prices of steel products; (h) changes in environmental, tax, pension and other laws; (i) the terms of collective bargaining agreements; (j) employee strikes or other labor issues; and (k) U.S. and global economic performance and political developments. Domestic steel shipments and prices could be affected by import levels and actions taken by the U.S. Government and its agencies, including those related to CO2 emissions, climate change and shale gas development. Economic conditions and political factors in Europe and Canada that may affect U. S. Steel Europe’s and U. S. Steel Canada’s results include, but are not limited to: (l) taxation; (m) nationalization; (n) inflation; (o) fiscal instability; (p) political issues; (q) regulatory actions; and (r) quotas, tariffs, and other protectionist measures. We present adjusted net income (loss) and adjusted net income (loss) per diluted share, which are non-GAAP measures, as an additional measurement to enhance the understanding of our operating performance and facilitate a comparison with that of our competitors. In accordance with “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, cautionary statements identifying important factors, but not necessarily all factors, that could cause actual results to differ materially from those set forth in the forward-looking statements have been included in U. S. Steel’s Annual Report on Form 10-K for the year ended December 31, 2013, and in subsequent filings for U. S. Steel.
A Consolidated Statement of Operations (Unaudited), Consolidated Cash Flow Statement (Unaudited), Condensed Consolidated Balance Sheet (Unaudited) and Preliminary Supplemental Statistics (Unaudited) for U. S. Steel are attached.


5


The company will conduct a conference call on second quarter earnings on Wednesday, July 30, at 8:30 a.m. Eastern Daylight Time. To listen to the webcast of the conference call, visit the U. S. Steel website, www.ussteel.com, and click on “Current Information” under the “Investors” section.
For more information on U. S. Steel, visit our website at www.ussteel.com.
-oOo-
2014-028




UNITED STATES STEEL CORPORATION
STATEMENT OF OPERATIONS (Unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
Six Months Ended
 
 
 
June 30
 
March 31
 
June 30
 
June 30,
(Dollars in millions, except per share amounts)
2014
 
2014
 
2013
 
2014
 
2013
NET SALES
 
$
4,400

 
$
4,448

 
$
4,429

 
$
8,848

 
$
9,024

 
 
 
 
 
 
 
 
 
 
 
 
OPERATING EXPENSES (INCOME):
 
 
 
 
 
 
 
 
 
 
Cost of sales (excludes items shown below)
4,097

 
4,038

 
4,114

 
8,135

 
8,356

 
Selling, general and administrative expenses
143

 
138

 
151

 
281

 
296

 
Depreciation, depletion and amortization
165

 
166

 
170

 
331

 
341

 
(Income) loss from investees
(57
)
 
4

 
3

 
(53
)
 
(5
)
 
Restructuring and other charges
18

 

 

 
18

 

 
Net gain on disposal of assets
(1
)
 
(20
)
 
(1
)
 
(21
)
 

 
Other (income) expense, net

 

 
(1
)
 

 
5

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total operating expenses
4,365

 
4,326

 
4,436

 
8,691

 
8,993

 
 
 
 
 
 
 
 
 
 
 
 
INCOME (LOSS) FROM OPERATIONS
35

 
122

 
(7
)
 
157

 
31

Net interest and other financial costs
64

 
69

 
68

 
133

 
172

 
 
 
 
 
 
 
 
 
 
 
 
(LOSS) INCOME BEFORE INCOME TAXES


 
 
 
 
 
 
 
 
 
AND NONCONTROLLING INTERESTS
(29
)
 
53

 
(75
)
 
24

 
(141
)
Income tax (benefit) provision
(11
)
 
1

 
3

 
(10
)
 
10

 
 
 
 
 
 
 
 
 
 
 
 
Net (loss) income
(18
)
 
52

 
(78
)
 
34

 
(151
)
 
Less: Net loss attributable to the
 
 
 
 
 
 
 
 
 
 
   noncontrolling interests

 

 

 

 

NET (LOSS) INCOME ATTRIBUTABLE TO
 
 
 
 
 
 
 
 
 
 
UNITED STATES STEEL CORPORATION
$
(18
)
 
$
52

 
$
(78
)
 
$
34

 
$
(151
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
COMMON STOCK DATA:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net (loss) income per share attributable to
 
 
 
 
 
 
 
 
 
   United States Steel Corporation shareholders:
 
 
 
 
 
 
 
 
 
 
-Basic
 
$
(0.12
)
 
$
0.36

 
$
(0.54
)
 
$
0.23

 
$
(1.05
)
 
-Diluted
 
$
(0.12
)
 
$
0.34

 
$
(0.54
)
 
$
0.23

 
$
(1.05
)
 
 
 
 
 
 
 
 
 
 
 
 
Weighted average shares, in thousands
 
 
 
 
 
 
 
 
 
 
-Basic
 
144,884

 
144,757

 
144,485

 
144,821

 
144,419

 
-Diluted
 
144,884

 
156,114

 
144,485

 
146,144

 
144,419

 
 
 
 
 
 
 
 
 
 
 
 
Dividends paid per common share
$
0.05

 
$
0.05

 
$
0.05

 
$
0.10

 
$
0.10







UNITED STATES STEEL CORPORATION
CASH FLOW STATEMENT (Unaudited)
 
 
 
 
 
 
 
 
 
 
 
Six Months Ended
 
 
 
 
June 30,
(Dollars in millions)
 
2014
 
2013
Cash provided by (used in) operating activities:
 
 
 
 
Net income (loss)
 
$
34

 
$
(151
)
 
Depreciation, depletion and amortization
331

 
341

 
Non-cash restructuring and other charges
18

 

 
Pensions and other postretirement benefits
(59
)
 
10

 
Deferred income taxes
16

 
(2
)
 
Net gain on disposal of assets
(21
)
 

 
Working capital changes
833

 
162

 
Income taxes receivable/payable
153

 
(3
)
 
Currency remeasurement loss
3

 
21

 
Other operating activities
45

 
6

 
 
Total
 
1,353

 
384

 
 
 
 
 
 
 
Cash (used in) provided by investing activities:
 
 
 
 
Capital expenditures
 
(186
)
 
(221
)
 
Acquisition of intangible assets
 

 
(12
)
 
Disposal of assets
 
26

 
1

 
Other investing activities
 
13

 
28

 
 
Total
 
(147
)
 
(204
)
 
 
 
 
 
 
 
Cash (used in) provided by financing activities:
 
 
 
 
Issuance of long-term debt, net of financing costs

 
576

 
Repayment of long-term debt
 
(322
)
 
(542
)
 
Receipts from exercise of stock options
1

 

 
Dividends paid
 
(15
)
 
(14
)
 
 
Total
 
(336
)
 
20

 
 
 
 
 
 
 
Effect of exchange rate changes on cash
(3
)
 
(3
)
 
 
 
 
 
 
 
Net increase in cash and cash equivalents
867

 
197

Cash and cash equivalents at beginning of the year
604

 
570

 
 
 
 
 
 
 
Cash and cash equivalents at end of the period
$
1,471

 
$
767








UNITED STATES STEEL CORPORATION
CONDENSED BALANCE SHEET (Unaudited)
 
 
 
 
 
 
 
 
 
June 30
 
Dec. 31
(Dollars in millions)
 
2014
 
2013
Cash and cash equivalents
$
1,471

 
$
604

Receivables, net
2,086

 
2,160

Inventories
2,337

 
2,688

Other current assets
633

 
626

 
Total current assets
6,527

 
6,078

Property, plant and equipment, net
5,736

 
5,922

Investments and long-term receivables, net
622

 
621

Intangible assets, net
266

 
271

Other assets
255

 
251

 
 
 
 
 
 
 
Total assets
 
$
13,406

 
$
13,143

 
 
 
 
 
 
Accounts payable
$
2,294

 
$
1,754

Payroll and benefits payable
998

 
974

Short-term debt and current maturities of long-term debt
20

 
323

Other current liabilities
209

 
194

 
Total current liabilities
3,521

 
3,245

Long-term debt, less unamortized discount
3,605

 
3,616

Employee benefits
1,841

 
2,064

Other long-term liabilities (a)
925

 
842

United States Steel Corporation stockholders' equity (a)
3,513

 
3,375

Noncontrolling interests
1

 
1

 
 
 
 
 
 
 
Total liabilities and stockholders' equity
$
13,406

 
$
13,143


(a) 2013 amounts for other long-term liabilities and stockholders' equity (retained earnings)
have been revised to correct an error that resulted in additional tax benefit of $27 million.




UNITED STATES STEEL CORPORATION
NON-GAAP FINANCIAL MEASURES (Unaudited)


We present adjusted net income and adjusted net income per diluted share, which are non-GAAP measures, as an additional measurement to enhance the understanding of our operating performance and facilitate a comparison with that of our competitors.
The following schedule reflects the reconciliation of adjusted net income:

UNITED STATES STEEL CORPORATION
RECONCILIATION OF ADJUSTED NET INCOME (LOSS)
 
 
 
 
 
 
 
 
 
Quarter Ended
 
 
June 30
 
March 31
 
June 30
(Dollars in millions, except per share amounts)
2014
 
2014
 
2013
Reconciliation to net income (loss) attributable to United States Steel Corporation
 
 
 
 
 
 
Adjusted net income (loss) attributable to United States Steel Corporation
$
25

 
$
52

 
$
(78
)
 
Litigation reserves
(46
)
 

 

 
Loss on assets held for sale
(9
)
 

 

 
Curtailment gain
12

 

 

 
Net (loss) income attributable to United States Steel Corporation, as reported
$
(18
)
 
$
52

 
(78
)
 
 
 
 
 
 
 
Reconciliation to diluted net income (loss) per share
 
 
 
 
 
 
Adjusted diluted net income (loss) per share
$
0.17

 
$
0.34

 
$
(0.54
)
 
Litigation reserves
(0.31
)
 

 

 
Loss on assets held for sale
(0.06
)
 

 

 
Curtailment gain
0.08

 

 

 
Diluted net (loss) income per share, as reported
$
(0.12
)
 
$
0.34

 
$
(0.54
)










UNITED STATES STEEL CORPORATION
PRELIMINARY SUPPLEMENTAL STATISTICS (Unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
Six Months Ended
 
 
June 30
 
March 31
 
June 30
 
June 30,
(Dollars in millions)
2014
 
2014
 
2013
 
2014
 
2013
INCOME (LOSS) FROM OPERATIONS
 
 
 
 
 
 
 
 
 
 
Flat-rolled
$
30

 
$
85

 
$
(51
)
 
$
115

 
$
(64
)
 
U. S. Steel Europe
38

 
32

 
10

 
70

 
48

 
Tubular
47

 
24

 
45

 
71

 
109

 
Other Businesses
17

 
13

 
43

 
30

 
48

 
 
 
 
 
 
 
 
 
 
 
Reportable Segment and Other Businesses Income from Operations
132

 
154

 
47

 
286

 
141

 
Postretirement benefit expense
(32
)
 
(32
)
 
(54
)
 
(64
)
 
(110
)
 
Other items not allocated to segments:
 
 
 
 
 
 
 
 
 
 
     Litigation reserves
(70
)
 

 

 
(70
)
 

 
     Loss on assets held for sale
(14
)
 

 

 
(14
)
 

 
     Curtailment gain
19

 

 

 
19

 

 
 
 
 
 
 
 
 
 
 
 
 
          Total Income (Loss) from Operations
$
35

 
$
122

 
$
(7
)
 
$
157

 
$
31

 
 
 
 
 
 
 
 
 
 
 
CAPITAL EXPENDITURES
 
 
 
 
 
 
 
 
 
 
Flat-rolled
$
47

 
$
55

 
$
80

 
$
102

 
$
176

 
U. S. Steel Europe
17

 
18

 
8

 
35

 
18

 
Tubular
31

 
16

 
15

 
47

 
23

 
Other Businesses
1

 
1

 
2

 
2

 
4

 
 
 
 
 
 
 
 
 
 
 
 
          Total
$
96

 
$
90

 
$
105

 
$
186

 
$
221












UNITED STATES STEEL CORPORATION
PRELIMINARY SUPPLEMENTAL STATISTICS (Unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
 
Six Months Ended
 
 
 
 
June 30
 
March 31
 
June 30
 
June 30,
 
 
 
 
2014
 
2014
 
2013
 
2014
 
2013
OPERATING STATISTICS
 
 
 
 
 
 
 
 
 
 
Average realized price: ($/net ton) (a)
 
 
 
 
 
 
 
 
 
 
 
Flat-rolled
774

 
761

 
725

 
767

 
722

 
 
U. S. Steel Europe
691

 
710

 
702

 
700

 
710

 
 
Tubular
1,479

 
1,479

 
1,510

 
1,479

 
1,532

 
Steel Shipments: (a) (b)


 
 
 
 
 


 
 
 
 
Flat-rolled
3,527

 
3,674

 
3,728

 
7,201

 
7,746

 
 
U. S. Steel Europe
1,053

 
1,031

 
1,062

 
2,084

 
2,110

 
 
Tubular
449

 
419

 
456

 
868

 
884

 
 
 
Total Steel Shipments
5,029

 
5,124

 
5,246

 
10,153

 
10,740

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Intersegment Shipments: (b)
 
 
 
 
 
 
 
 
 
 
 
Flat-rolled to Tubular
457

 
435

 
445

 
892

 
886

 
 
U. S. Steel Europe to Flat-rolled
75

 

 

 
75

 

 
Raw Steel Production: (b)
 
 
 
 
 
 
 
 
 
 
 
Flat-rolled
4,132

 
4,491

 
4,212

 
8,623

 
9,132

 
 
U. S. Steel Europe
1,223

 
1,141

 
1,158

 
2,364

 
2,361

 
Raw Steel Capability Utilization: (c)
 
 
 
 
 
 
 
 
 
 
 
Flat-rolled
75
%
 
83
%
 
70
%
 
79
%
 
76
%
 
 
    Flat-rolled U.S. Facilities (d)
73
%
 
81
%
 
87
%
 
77
%
 
89
%
 
 
U. S. Steel Europe
98
%
 
93
%
 
93
%
 
95
%
 
95
%
(a) Excludes intersegment shipments.
(b) Thousands of net tons.
(c) Based on annual raw steel production capability of 22.0 million net tons for Flat-rolled and 5.0 million net tons for
U. S. Steel Europe. Prior to the permanent shut down of the iron and steelmaking facilities at Hamilton Works on December 31, 2013, annual raw steel production capability for Flat-rolled was 24.3 million net tons.
(d) AISI capability utilization rates include our U.S. facilities (Gary Works, Great Lakes Works, Mon Valley Works, Granite City Works and Fairfield Works).