|
[X]
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
[ ]
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
|
1-16811
|
|
25-1897152
|
(State or other
jurisdiction of
incorporation)
|
|
(Commission
File Number)
|
|
(IRS Employer
Identification No.)
|
600 Grant Street, Pittsburgh, PA
|
|
15219-2800
|
(Address of principal executive offices)
|
|
(Zip Code)
|
|
|
Page
|
||
PART I – FINANCIAL INFORMATION
|
|
||
|
Item 1.
|
Financial Statements:
|
|
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
Item 2.
|
||
|
Item 3.
|
||
|
Item 4.
|
||
|
|
||
PART II – OTHER INFORMATION
|
|
||
|
Item 1.
|
||
|
Item 4.
|
||
|
Item 5.
|
||
|
Item 6.
|
||
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
(Dollars in millions, except per share amounts)
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Net sales:
|
|
|
|
|
|
|
|
|
||||||||
Net sales
|
|
$
|
2,976
|
|
|
$
|
2,370
|
|
|
$
|
8,176
|
|
|
$
|
6,716
|
|
Net sales to related parties (Note 18)
|
|
272
|
|
|
316
|
|
|
941
|
|
|
895
|
|
||||
Total
|
|
3,248
|
|
|
2,686
|
|
|
9,117
|
|
|
7,611
|
|
||||
Operating expenses (income):
|
|
|
|
|
|
|
|
|
||||||||
Cost of sales (excludes items shown below)
|
|
2,829
|
|
|
2,360
|
|
|
8,115
|
|
|
7,193
|
|
||||
Selling, general and administrative expenses
|
|
89
|
|
|
73
|
|
|
265
|
|
|
206
|
|
||||
Depreciation, depletion and amortization
|
|
118
|
|
|
126
|
|
|
376
|
|
|
384
|
|
||||
Earnings from investees
|
|
(9
|
)
|
|
(18
|
)
|
|
(29
|
)
|
|
(91
|
)
|
||||
Gain on equity investee transactions (Note 4)
|
|
(21
|
)
|
|
—
|
|
|
(21
|
)
|
|
—
|
|
||||
Gain associated with retained interest in U. S. Steel Canada Inc. (Note 21)
|
|
—
|
|
|
—
|
|
|
(72
|
)
|
|
—
|
|
||||
Impairment of intangible assets
|
|
—
|
|
|
14
|
|
|
—
|
|
|
14
|
|
||||
Restructuring and other charges (Note 19)
|
|
(2
|
)
|
|
(3
|
)
|
|
30
|
|
|
1
|
|
||||
Net (gain) loss on disposal of assets
|
|
(1
|
)
|
|
3
|
|
|
(2
|
)
|
|
6
|
|
||||
Other income, net
|
|
—
|
|
|
(1
|
)
|
|
(5
|
)
|
|
(1
|
)
|
||||
Total
|
|
3,003
|
|
|
2,554
|
|
|
8,657
|
|
|
7,712
|
|
||||
Earnings (loss) before interest and income taxes
|
|
245
|
|
|
132
|
|
|
460
|
|
|
(101
|
)
|
||||
Interest expense
|
|
60
|
|
|
58
|
|
|
173
|
|
|
173
|
|
||||
Interest income
|
|
(5
|
)
|
|
(2
|
)
|
|
(13
|
)
|
|
(5
|
)
|
||||
Loss on debt extinguishment
|
|
31
|
|
|
—
|
|
|
32
|
|
|
22
|
|
||||
Other financial costs
|
|
12
|
|
|
6
|
|
|
37
|
|
|
18
|
|
||||
Net interest and other financial costs (Note 7)
|
|
98
|
|
|
62
|
|
|
229
|
|
|
208
|
|
||||
Earnings (loss) before income taxes
|
|
147
|
|
|
70
|
|
|
231
|
|
|
(309
|
)
|
||||
Income tax provision (Note 9)
|
|
—
|
|
|
19
|
|
|
3
|
|
|
26
|
|
||||
Net earnings (loss)
|
|
147
|
|
|
51
|
|
|
228
|
|
|
(335
|
)
|
||||
Less: Net earnings attributable to noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Net earnings (loss) attributable to United States Steel Corporation
|
|
$
|
147
|
|
|
$
|
51
|
|
|
$
|
228
|
|
|
$
|
(335
|
)
|
Earnings (loss) per common share
(Note 10):
|
|
|
|
|
|
|
|
|
||||||||
Earnings (loss) per share attributable to United States Steel Corporation stockholders:
|
|
|
|
|
|
|
|
|
||||||||
-Basic
|
|
$
|
0.84
|
|
|
$
|
0.32
|
|
|
$
|
1.30
|
|
|
$
|
(2.22
|
)
|
-Diluted
|
|
$
|
0.83
|
|
|
$
|
0.32
|
|
|
$
|
1.29
|
|
|
$
|
(2.22
|
)
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
(Dollars in millions)
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Net earnings (loss)
|
|
$
|
147
|
|
|
$
|
51
|
|
|
$
|
228
|
|
|
$
|
(335
|
)
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
|
||||||||
Changes in foreign currency translation adjustments
|
|
44
|
|
|
10
|
|
|
149
|
|
|
41
|
|
||||
Changes in pension and other employee benefit accounts
|
|
55
|
|
|
48
|
|
|
146
|
|
|
(134
|
)
|
||||
Other
|
|
8
|
|
|
(4
|
)
|
|
6
|
|
|
17
|
|
||||
Total other comprehensive income (loss), net of tax
|
|
107
|
|
|
54
|
|
|
301
|
|
|
(76
|
)
|
||||
Comprehensive income (loss) including noncontrolling interest
|
|
254
|
|
|
105
|
|
|
529
|
|
|
(411
|
)
|
||||
Comprehensive income attributable to noncontrolling interest
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Comprehensive income (loss) attributable to United States Steel Corporation
|
|
$
|
254
|
|
|
$
|
105
|
|
|
$
|
529
|
|
|
$
|
(411
|
)
|
(Dollars in millions)
|
|
(Unaudited)
September 30, 2017 |
|
December 31,
2016 |
||||
Assets
|
|
|
|
|
||||
Current assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
1,694
|
|
|
$
|
1,515
|
|
Receivables, less allowance of $29 and $25
|
|
1,317
|
|
|
976
|
|
||
Receivables from related parties, less allowance of $0 and $265 (Notes 18 and 21)
|
|
210
|
|
|
272
|
|
||
Inventories (Note 11)
|
|
1,737
|
|
|
1,573
|
|
||
Other current assets
|
|
43
|
|
|
20
|
|
||
Total current assets
|
|
5,001
|
|
|
4,356
|
|
||
Property, plant and equipment
|
|
14,781
|
|
|
14,196
|
|
||
Less accumulated depreciation and depletion
|
|
10,670
|
|
|
10,217
|
|
||
Total property, plant and equipment, net
|
|
4,111
|
|
|
3,979
|
|
||
Investments and long-term receivables, less allowance of $11 and $10
|
|
470
|
|
|
528
|
|
||
Long-term receivables from related parties, less allowance of $0 and $1,627 (Notes 18 and 21)
|
|
—
|
|
|
—
|
|
||
Intangibles, net (Note 5)
|
|
169
|
|
|
175
|
|
||
Deferred income tax benefits (Note 9)
|
|
—
|
|
|
6
|
|
||
Other noncurrent assets
|
|
127
|
|
|
116
|
|
||
Total assets
|
|
$
|
9,878
|
|
|
$
|
9,160
|
|
Liabilities
|
|
|
|
|
||||
Current liabilities:
|
|
|
|
|
||||
Accounts payable and other accrued liabilities
|
|
$
|
2,018
|
|
|
$
|
1,602
|
|
Accounts payable to related parties (Notes 18 and 21)
|
|
79
|
|
|
66
|
|
||
Payroll and benefits payable
|
|
333
|
|
|
400
|
|
||
Accrued taxes
|
|
157
|
|
|
128
|
|
||
Accrued interest
|
|
62
|
|
|
85
|
|
||
Short-term debt and current maturities of long-term debt (Note 13)
|
|
3
|
|
|
50
|
|
||
Total current liabilities
|
|
2,652
|
|
|
2,331
|
|
||
Long-term debt, less unamortized discount and debt issuance costs (Note 13)
|
|
2,896
|
|
|
2,981
|
|
||
Employee benefits
|
|
1,119
|
|
|
1,216
|
|
||
Deferred income tax liabilities (Note 9)
|
|
29
|
|
|
28
|
|
||
Deferred credits and other noncurrent liabilities
|
|
374
|
|
|
329
|
|
||
Total liabilities
|
|
7,070
|
|
|
6,885
|
|
||
Contingencies and commitments (Note 20)
|
|
|
|
|
||||
Stockholders’ Equity
(Note 16):
|
|
|
|
|
||||
Common stock (176,424,554 shares issued) (Note 10)
|
|
176
|
|
|
176
|
|
||
Treasury stock, at cost (1,466,183 and 2,614,378 shares)
|
|
(92
|
)
|
|
(182
|
)
|
||
Additional paid-in capital
|
|
3,937
|
|
|
4,027
|
|
||
Accumulated deficit
|
|
(18
|
)
|
|
(250
|
)
|
||
Accumulated other comprehensive loss (Note 17)
|
|
(1,196
|
)
|
|
(1,497
|
)
|
||
Total United States Steel Corporation stockholders’ equity
|
|
2,807
|
|
|
2,274
|
|
||
Noncontrolling interests
|
|
1
|
|
|
1
|
|
||
Total liabilities and stockholders’ equity
|
|
$
|
9,878
|
|
|
$
|
9,160
|
|
|
|
Nine Months Ended
September 30, |
||||||
(Dollars in millions)
|
|
2017
|
|
2016
|
||||
Increase (decrease) in cash and cash equivalents
|
|
|
|
|
||||
Operating activities:
|
|
|
|
|
||||
Net earnings (loss)
|
|
$
|
228
|
|
|
$
|
(335
|
)
|
Adjustments to reconcile to net cash provided by operating activities:
|
|
|
|
|
||||
Depreciation, depletion and amortization
|
|
376
|
|
|
384
|
|
||
Gain associated with retained interest in U. S. Steel Canada Inc. (Note 21)
|
|
(72
|
)
|
|
—
|
|
||
Gain on equity investee transactions (Note 4)
|
|
(21
|
)
|
|
—
|
|
||
Impairment of intangible assets
|
|
—
|
|
|
14
|
|
||
Restructuring and other charges (Note 19)
|
|
30
|
|
|
1
|
|
||
Provision for doubtful accounts
|
|
1
|
|
|
—
|
|
||
Pensions and other postretirement benefits
|
|
42
|
|
|
(38
|
)
|
||
Deferred income taxes
|
|
7
|
|
|
9
|
|
||
Net (gain) loss on disposal of assets
|
|
(2
|
)
|
|
6
|
|
||
Distributions received, net of equity investees earnings
|
|
(18
|
)
|
|
(86
|
)
|
||
Changes in:
|
|
|
|
|
||||
Current receivables
|
|
(214
|
)
|
|
(127
|
)
|
||
Inventories
|
|
(123
|
)
|
|
339
|
|
||
Current accounts payable and accrued expenses
|
|
121
|
|
|
279
|
|
||
Income taxes receivable/payable
|
|
15
|
|
|
14
|
|
||
Bank checks outstanding
|
|
12
|
|
|
15
|
|
||
All other, net
|
|
159
|
|
|
105
|
|
||
Net cash provided by operating activities
|
|
541
|
|
|
580
|
|
||
Investing activities:
|
|
|
|
|
||||
Capital expenditures
|
|
(291
|
)
|
|
(268
|
)
|
||
Disposal of assets
|
|
—
|
|
|
6
|
|
||
Change in restricted cash, net
|
|
(1
|
)
|
|
(3
|
)
|
||
Proceeds from sale of ownership interest in equity investee (Note 22)
|
|
105
|
|
|
—
|
|
||
Investments, net
|
|
(3
|
)
|
|
(17
|
)
|
||
Net cash used in investing activities
|
|
(190
|
)
|
|
(282
|
)
|
||
Financing activities:
|
|
|
|
|
||||
Issuance of long-term debt, net of financing costs
|
|
737
|
|
|
958
|
|
||
Repayment of long-term debt
|
|
(902
|
)
|
|
(1,019
|
)
|
||
Settlement of contingent consideration
|
|
—
|
|
|
(15
|
)
|
||
Net proceeds from public offering of common stock
|
|
—
|
|
|
482
|
|
||
Dividends paid
|
|
(26
|
)
|
|
(22
|
)
|
||
Taxes paid for equity compensation plans (Note 3)
|
|
(10
|
)
|
|
(3
|
)
|
||
Receipts from exercise of stock options
|
|
14
|
|
|
4
|
|
||
Net cash (used in) provided by financing activities
|
|
(187
|
)
|
|
385
|
|
||
Effect of exchange rate changes on cash
|
|
15
|
|
|
7
|
|
||
Net increase in cash and cash equivalents
|
|
179
|
|
|
690
|
|
||
Cash and cash equivalents at beginning of year
|
|
1,515
|
|
|
755
|
|
||
Cash and cash equivalents at end of period
|
|
$
|
1,694
|
|
|
$
|
1,445
|
|
|
(In millions)
|
||
Remaining Useful Life of Assets
|
Net Book Value at December 31, 2016
|
||
Under 5 years
|
$
|
597
|
|
6-10 years
|
629
|
|
|
11-15 years
|
765
|
|
|
16-20 years
|
654
|
|
|
21-25 years
|
363
|
|
|
Over 25 years
|
479
|
|
|
Assets not subject to depreciation
|
492
|
|
|
Total
|
$
|
3,979
|
|
(In millions)
Three Months Ended September 30, 2017
|
|
Customer
Sales |
|
Intersegment
Sales |
|
Net
Sales |
|
Earnings
(Loss) from Investees |
|
Earnings (Loss) Before Interest and Income Taxes
|
||||||||||
Flat-Rolled
|
|
$
|
2,249
|
|
|
$
|
42
|
|
|
$
|
2,291
|
|
|
$
|
7
|
|
|
$
|
160
|
|
USSE
|
|
710
|
|
|
1
|
|
|
711
|
|
|
—
|
|
|
73
|
|
|||||
Tubular
|
|
276
|
|
|
—
|
|
|
276
|
|
|
2
|
|
|
(7
|
)
|
|||||
Total reportable segments
|
|
3,235
|
|
|
43
|
|
|
3,278
|
|
|
9
|
|
|
226
|
|
|||||
Other Businesses
|
|
13
|
|
|
29
|
|
|
42
|
|
|
—
|
|
|
12
|
|
|||||
Reconciling Items and Eliminations
|
|
—
|
|
|
(72
|
)
|
|
(72
|
)
|
|
—
|
|
|
7
|
|
|||||
Total
|
|
$
|
3,248
|
|
|
$
|
—
|
|
|
$
|
3,248
|
|
|
$
|
9
|
|
|
$
|
245
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Three Months Ended September 30, 2016
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Flat-Rolled
|
|
$
|
1,986
|
|
|
$
|
—
|
|
|
$
|
1,986
|
|
|
$
|
18
|
|
|
$
|
114
|
|
USSE
|
|
575
|
|
|
1
|
|
|
576
|
|
|
—
|
|
|
81
|
|
|||||
Tubular
|
|
114
|
|
|
—
|
|
|
114
|
|
|
1
|
|
|
(75
|
)
|
|||||
Total reportable segments
|
|
2,675
|
|
|
1
|
|
|
2,676
|
|
|
19
|
|
|
120
|
|
|||||
Other Businesses
|
|
11
|
|
|
27
|
|
|
38
|
|
|
(1
|
)
|
|
18
|
|
|||||
Reconciling Items and Eliminations
|
|
—
|
|
|
(28
|
)
|
|
(28
|
)
|
|
—
|
|
|
(6
|
)
|
|||||
Total
|
|
$
|
2,686
|
|
|
$
|
—
|
|
|
$
|
2,686
|
|
|
$
|
18
|
|
|
$
|
132
|
|
(In millions)
Nine Months Ended September 30, 2017
|
|
Customer
Sales |
|
Intersegment
Sales |
|
Net
Sales |
|
Earnings
(Loss) from Investees |
|
Earnings (Loss) Before Interest and Income Taxes
|
||||||||||
Flat-Rolled
|
|
$
|
6,265
|
|
|
$
|
154
|
|
|
$
|
6,419
|
|
|
$
|
24
|
|
|
$
|
288
|
|
USSE
|
|
2,123
|
|
|
25
|
|
|
2,148
|
|
|
—
|
|
|
215
|
|
|||||
Tubular
|
|
682
|
|
|
—
|
|
|
682
|
|
|
6
|
|
|
(93
|
)
|
|||||
Total reportable segments
|
|
9,070
|
|
|
179
|
|
|
9,249
|
|
|
30
|
|
|
410
|
|
|||||
Other Businesses
|
|
47
|
|
|
89
|
|
|
136
|
|
|
(1
|
)
|
|
34
|
|
|||||
Reconciling Items and Eliminations
|
|
—
|
|
|
(268
|
)
|
|
(268
|
)
|
|
—
|
|
|
16
|
|
|||||
Total
|
|
$
|
9,117
|
|
|
$
|
—
|
|
|
$
|
9,117
|
|
|
$
|
29
|
|
|
$
|
460
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Nine Months Ended September 30, 2016
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Flat-Rolled
|
|
$
|
5,643
|
|
|
$
|
16
|
|
|
$
|
5,659
|
|
|
$
|
88
|
|
|
$
|
(68
|
)
|
USSE
|
|
1,616
|
|
|
2
|
|
|
1,618
|
|
|
—
|
|
|
122
|
|
|||||
Tubular
|
|
303
|
|
|
2
|
|
|
305
|
|
|
5
|
|
|
(217
|
)
|
|||||
Total reportable segments
|
|
7,562
|
|
|
20
|
|
|
7,582
|
|
|
93
|
|
|
(163
|
)
|
|||||
Other Businesses
|
|
49
|
|
|
80
|
|
|
129
|
|
|
(2
|
)
|
|
42
|
|
|||||
Reconciling Items and Eliminations
|
|
—
|
|
|
(100
|
)
|
|
(100
|
)
|
|
—
|
|
|
20
|
|
|||||
Total
|
|
$
|
7,611
|
|
|
$
|
—
|
|
|
$
|
7,611
|
|
|
$
|
91
|
|
|
$
|
(101
|
)
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
(In millions)
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Items not allocated to segments:
|
|
|
|
|
|
|
|
|
||||||||
Postretirement benefit (expense) income
(a)
|
|
$
|
(14
|
)
|
|
$
|
8
|
|
|
$
|
(42
|
)
|
|
$
|
36
|
|
Other items not allocated to segments:
|
|
|
|
|
|
|
|
|
||||||||
Loss on shutdown of certain tubular assets
(b)
|
|
—
|
|
|
—
|
|
|
(35
|
)
|
|
—
|
|
||||
Gain on equity investee transactions
(c)
|
|
21
|
|
|
—
|
|
|
21
|
|
|
—
|
|
||||
Gain associated with retained interest in U. S. Steel Canada Inc. (Note 21)
|
|
—
|
|
|
—
|
|
|
72
|
|
|
—
|
|
||||
Impairment of intangible assets (Note 5)
|
|
—
|
|
|
(14
|
)
|
|
—
|
|
|
(14
|
)
|
||||
Restructuring and other charges and adjustments
(d)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
||||
Total other items not allocated to segments
|
|
21
|
|
|
(14
|
)
|
|
58
|
|
|
(16
|
)
|
||||
Total reconciling items
|
|
$
|
7
|
|
|
$
|
(6
|
)
|
|
$
|
16
|
|
|
$
|
20
|
|
|
|
|
|
As of September 30, 2017
|
|
As of December 31, 2016
|
||||||||||||||||||||
(In millions)
|
|
Useful
Lives |
|
Gross
Carrying Amount |
|
Accumulated
Amortization |
|
Net
Amount |
|
Gross
Carrying Amount |
|
Accumulated
Amortization |
|
Net
Amount |
||||||||||||
Customer relationships
|
|
12 Years
|
|
$
|
132
|
|
|
$
|
63
|
|
|
$
|
69
|
|
|
$
|
132
|
|
|
$
|
59
|
|
|
$
|
73
|
|
Patents
|
|
5-12 Years
|
|
22
|
|
|
4
|
|
|
18
|
|
|
22
|
|
|
2
|
|
|
20
|
|
||||||
Other
|
|
4-10 Years
|
|
14
|
|
|
7
|
|
|
7
|
|
|
14
|
|
|
7
|
|
|
7
|
|
||||||
Total amortizable intangible assets
|
|
|
|
$
|
168
|
|
|
$
|
74
|
|
|
$
|
94
|
|
|
$
|
168
|
|
|
$
|
68
|
|
|
$
|
100
|
|
|
|
Pension
Benefits |
|
Other
Benefits |
|
||||||||||||
(In millions)
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
||||||||
Service cost
|
|
$
|
13
|
|
|
$
|
14
|
|
|
$
|
4
|
|
|
$
|
5
|
|
|
Interest cost
|
|
59
|
|
|
64
|
|
|
23
|
|
|
25
|
|
|
||||
Expected return on plan assets
|
|
(98
|
)
|
|
(106
|
)
|
|
(16
|
)
|
|
(38
|
)
|
|
||||
Amortization of prior service cost
|
|
—
|
|
|
2
|
|
|
8
|
|
|
6
|
|
|
||||
Amortization of actuarial net loss
|
|
37
|
|
|
33
|
|
|
1
|
|
|
1
|
|
|
||||
Net periodic benefit cost (income), excluding below
|
|
11
|
|
|
7
|
|
|
20
|
|
|
(1
|
)
|
|
||||
Multiemployer plans
|
|
15
|
|
|
16
|
|
|
—
|
|
|
—
|
|
|
||||
Settlement, termination and curtailment losses
|
|
1
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|
||||
Net periodic benefit cost (income)
|
|
$
|
27
|
|
|
$
|
33
|
|
|
$
|
20
|
|
|
$
|
(1
|
)
|
|
|
|
Pension
Benefits |
|
Other
Benefits |
|
||||||||||||
(In millions)
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
||||||||
Service cost
|
|
$
|
37
|
|
|
$
|
40
|
|
|
$
|
13
|
|
|
$
|
15
|
|
|
Interest cost
|
|
177
|
|
|
194
|
|
|
70
|
|
|
74
|
|
|
||||
Expected return on plan assets
|
|
(292
|
)
|
|
(316
|
)
|
|
(49
|
)
|
|
(113
|
)
|
|
||||
Amortization of prior service cost
|
|
—
|
|
|
8
|
|
|
22
|
|
|
19
|
|
|
||||
Amortization of actuarial net loss
|
|
111
|
|
|
97
|
|
|
3
|
|
|
2
|
|
|
||||
Net periodic benefit cost (income), excluding below
|
|
33
|
|
|
23
|
|
|
59
|
|
|
(3
|
)
|
|
||||
Multiemployer plans
|
|
44
|
|
|
48
|
|
|
—
|
|
|
—
|
|
|
||||
Settlement, termination and curtailment losses
|
|
5
|
|
|
13
|
|
|
—
|
|
|
—
|
|
|
||||
Net periodic benefit cost (income)
|
|
$
|
82
|
|
|
$
|
84
|
|
|
$
|
59
|
|
|
$
|
(3
|
)
|
|
|
2017
|
|
2016
|
||||||||
Grant Details
|
Shares
(a)
|
Fair Value
(b)
|
|
Shares
(a)
|
Fair Value
(b)
|
||||||
Stock Options
|
647,780
|
|
$
|
17.28
|
|
|
1,333,210
|
|
$
|
6.24
|
|
Restricted Stock Units
|
344,500
|
|
$
|
36.27
|
|
|
1,117,495
|
|
$
|
14.27
|
|
TSR Performance Awards
(c)
|
169,850
|
|
$
|
40.72
|
|
|
308,130
|
|
$
|
10.02
|
|
Black-Scholes Assumptions
(a)
|
|
2017 Grants
|
2016 Grants
|
||||
Grant date price per share of option award
|
|
$
|
36.94
|
|
$
|
14.78
|
|
Exercise price per share of option award
|
|
$
|
36.94
|
|
$
|
14.78
|
|
Expected annual dividends per share, at grant date
|
|
$
|
0.20
|
|
$
|
0.20
|
|
Expected life in years
|
|
5.0
|
|
5.0
|
|
||
Expected volatility
|
|
57
|
%
|
53
|
%
|
||
Risk-free interest rate
|
|
1.97
|
%
|
1.46
|
%
|
||
Grant date fair value per share of unvested option awards as calculated from above
|
|
$
|
17.28
|
|
$
|
6.24
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
(Dollars in millions, except per share amounts)
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Earnings (loss) attributable to United States Steel Corporation stockholders
|
|
$
|
147
|
|
|
$
|
51
|
|
|
$
|
228
|
|
|
$
|
(335
|
)
|
Weighted-average shares outstanding (in thousands):
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
175,003
|
|
|
160,513
|
|
|
174,684
|
|
|
151,199
|
|
||||
Effect of stock options, restricted stock units and performance awards
|
|
1,481
|
|
|
1,187
|
|
|
1,652
|
|
|
—
|
|
||||
Adjusted weighted-average shares outstanding, diluted
|
|
176,484
|
|
|
161,700
|
|
|
176,336
|
|
|
151,199
|
|
||||
Basic earnings (loss) per common share
|
|
$
|
0.84
|
|
|
$
|
0.32
|
|
|
$
|
1.30
|
|
|
$
|
(2.22
|
)
|
Diluted earnings (loss) per common share
|
|
$
|
0.83
|
|
|
$
|
0.32
|
|
|
$
|
1.29
|
|
|
$
|
(2.22
|
)
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended
September 30, |
||||||
(In thousands)
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||
Securities granted under the 2005 Stock Incentive Plan, as amended and the 2016 Omnibus Incentive Compensation Plan, as amended
|
|
2,679
|
|
|
4,613
|
|
1,677
|
|
|
9,568
|
(In millions)
|
|
September 30, 2017
|
|
December 31, 2016
|
||||
Raw materials
|
|
$
|
442
|
|
|
$
|
449
|
|
Semi-finished products
|
|
837
|
|
|
686
|
|
||
Finished products
|
|
405
|
|
|
375
|
|
||
Supplies and sundry items
|
|
53
|
|
|
63
|
|
||
Total
|
|
$
|
1,737
|
|
|
$
|
1,573
|
|
|
|
|
|
Fair Value
|
|
Fair Value
|
||||
(In millions)
|
|
Balance Sheet
Location |
|
September 30, 2017
|
|
December 31, 2016
|
||||
Foreign exchange forward contracts
|
|
Accounts receivable
|
|
$
|
—
|
|
|
$
|
9
|
|
Foreign exchange forward contracts
|
|
Accounts payable
|
|
$
|
12
|
|
|
$
|
—
|
|
(In millions)
|
|
Statement of
Operations Location |
|
Amount of Gain (Loss)
|
|
Amount of Gain (Loss)
|
||||
|
|
Three Months Ended September 30, 2017
|
|
Nine Months Ended
September 30, 2017 |
||||||
Foreign exchange forward contracts
|
|
Other financial income/
costs |
|
$
|
(7
|
)
|
|
$
|
(20
|
)
|
(In millions)
|
|
Statement of
Operations Location |
|
Amount of Gain (Loss)
|
|
Amount of Gain (Loss)
|
||||
|
|
Three Months Ended
September 30, 2016 |
|
Nine Months Ended September 30, 2016
|
||||||
Foreign exchange forward contracts
|
|
Other financial income/
costs |
|
$
|
—
|
|
|
$
|
(4
|
)
|
(In millions)
|
|
Interest
Rates %
|
|
Maturity
|
|
September 30, 2017
|
|
December 31, 2016
|
||||
2037 Senior Notes
|
|
6.65
|
|
2037
|
|
$
|
350
|
|
|
$
|
350
|
|
2025 Senior Notes
|
|
6.875
|
|
2025
|
|
750
|
|
|
—
|
|
||
2022 Senior Notes
|
|
7.50
|
|
2022
|
|
—
|
|
|
400
|
|
||
2021 Senior Secured Notes
|
|
8.375
|
|
2021
|
|
980
|
|
|
980
|
|
||
2021 Senior Notes
|
|
6.875
|
|
2021
|
|
—
|
|
|
200
|
|
||
2020 Senior Notes
|
|
7.375
|
|
2020
|
|
432
|
|
|
432
|
|
||
2018 Senior Notes
|
|
7.00
|
|
2018
|
|
—
|
|
|
161
|
|
||
Environmental Revenue Bonds
|
|
5.50 - 6.88
|
|
2017 - 2042
|
|
400
|
|
|
447
|
|
||
Recovery Zone Facility Bonds
|
|
6.75
|
|
2040
|
|
—
|
|
|
70
|
|
||
Fairfield Caster Lease
|
|
|
|
2022
|
|
26
|
|
|
28
|
|
||
Other capital leases and all other obligations
|
|
|
|
2019
|
|
1
|
|
|
1
|
|
||
Third Amended and Restated Credit Agreement
|
|
Variable
|
|
2020
|
|
—
|
|
|
—
|
|
||
USSK Revolver
|
|
Variable
|
|
2020
|
|
—
|
|
|
—
|
|
||
USSK credit facilities
|
|
Variable
|
|
2017 - 2018
|
|
—
|
|
|
—
|
|
||
Total Debt
|
|
|
|
|
|
2,939
|
|
|
3,069
|
|
||
Less unamortized discount and debt issuance costs
|
|
|
|
|
|
40
|
|
|
38
|
|
||
Less short-term debt and long-term debt due within one year
|
|
|
|
|
|
3
|
|
|
50
|
|
||
Long-term debt
|
|
|
|
|
|
$
|
2,896
|
|
|
$
|
2,981
|
|
Year
|
Redemption Price
|
|
2020
|
103.438
|
%
|
2021
|
101.719
|
%
|
2022 and thereafter
|
100.000
|
%
|
(In millions)
|
|
September 30, 2017
|
|
December 31, 2016
|
||||
Balance at beginning of year
|
|
$
|
79
|
|
|
$
|
89
|
|
Additional obligations incurred
|
|
—
|
|
|
2
|
|
||
Obligations settled
|
|
(4
|
)
|
|
(15
|
)
|
||
Change in estimate of obligations
|
|
(6
|
)
|
|
—
|
|
||
Foreign currency translation effects
|
|
1
|
|
|
—
|
|
||
Accretion expense
|
|
2
|
|
|
3
|
|
||
Balance at end of period
|
|
$
|
72
|
|
|
$
|
79
|
|
|
|
September 30, 2017
|
|
December 31, 2016
|
||||||||||||
(In millions)
|
|
Fair
Value |
|
Carrying
Amount |
|
Fair
Value |
|
Carrying
Amount |
||||||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
||||||||
Long-term debt
(a)
|
|
$
|
3,059
|
|
|
$
|
2,872
|
|
|
$
|
3,139
|
|
|
$
|
3,002
|
|
Nine Months Ended September 30, 2017 (In millions)
|
|
Total
|
|
Accumulated
Deficit |
|
Accumulated
Other Comprehensive (Loss) Income |
|
Common
Stock |
|
Treasury
Stock |
|
Paid-in
Capital |
|
Non-
Controlling Interest |
||||||||||||||
Balance at beginning of year
|
|
$
|
2,275
|
|
|
$
|
(250
|
)
|
|
$
|
(1,497
|
)
|
|
$
|
176
|
|
|
$
|
(182
|
)
|
|
$
|
4,027
|
|
|
$
|
1
|
|
Comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net earnings
|
|
228
|
|
|
228
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other comprehensive income, net of tax:
(a)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Pension and other benefit adjustments
|
|
146
|
|
|
|
|
146
|
|
|
|
|
|
|
|
|
|
||||||||||||
Currency translation adjustment
|
|
149
|
|
|
|
|
149
|
|
|
|
|
|
|
|
|
|
||||||||||||
Employee stock plans
|
|
26
|
|
|
|
|
|
|
|
|
90
|
|
|
(64
|
)
|
|
|
|||||||||||
Dividends paid on common stock
|
|
(26
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(26
|
)
|
|
|
||||||||||
Other
|
|
10
|
|
|
4
|
|
|
6
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance at September 30, 2017
|
|
$
|
2,808
|
|
|
$
|
(18
|
)
|
|
$
|
(1,196
|
)
|
|
$
|
176
|
|
|
$
|
(92
|
)
|
|
$
|
3,937
|
|
|
$
|
1
|
|
Nine Months Ended September 30, 2016 (In millions)
|
|
Total
|
|
Retained
Earnings
(Accumulated Deficit)
|
|
Accumulated
Other Comprehensive (Loss) Income |
|
Common
Stock |
|
Treasury
Stock |
|
Paid-in
Capital |
|
Non-
Controlling Interest |
||||||||||||||
Balance at beginning of year
|
|
$
|
2,437
|
|
|
$
|
190
|
|
|
$
|
(1,169
|
)
|
|
$
|
151
|
|
|
$
|
(339
|
)
|
|
$
|
3,603
|
|
|
$
|
1
|
|
Comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net loss
|
|
(335
|
)
|
|
(335
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other comprehensive income (loss), net of tax:
(b)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Pension and other benefit adjustments
|
|
(134
|
)
|
|
|
|
(134
|
)
|
|
|
|
|
|
|
|
|
||||||||||||
Currency translation adjustment
|
|
41
|
|
|
|
|
41
|
|
|
|
|
|
|
|
|
|
||||||||||||
Employee stock plans
|
|
16
|
|
|
|
|
|
|
|
|
62
|
|
|
(46
|
)
|
|
|
|||||||||||
Common stock issued
|
|
582
|
|
|
|
|
|
|
|
25
|
|
|
|
|
557
|
|
|
|
||||||||||
Dividends paid on common stock
|
|
(22
|
)
|
|
|
|
|
|
|
|
|
|
|
(22
|
)
|
|
|
|||||||||||
Other
|
|
17
|
|
|
|
|
17
|
|
|
|
|
|
|
|
|
|
||||||||||||
Balance at September 30, 2016
|
|
$
|
2,602
|
|
|
$
|
(145
|
)
|
|
$
|
(1,245
|
)
|
|
$
|
176
|
|
|
$
|
(277
|
)
|
|
$
|
4,092
|
|
|
$
|
1
|
|
(In millions)
(a)
|
|
Pension and
Other Benefit Items |
|
Foreign
Currency Items |
|
Other
|
|
Total
|
||||||||
Balance at December 31, 2016
|
|
$
|
(1,771
|
)
|
|
$
|
274
|
|
|
$
|
—
|
|
|
$
|
(1,497
|
)
|
Other comprehensive income before reclassifications
|
|
296
|
|
|
149
|
|
|
6
|
|
|
451
|
|
||||
Amounts reclassified from AOCI
|
|
(141
|
)
|
(b)
|
—
|
|
|
—
|
|
|
(141
|
)
|
||||
Sale of ownership interest in Tilden Mining Company L.C.
|
|
(9
|
)
|
|
—
|
|
|
—
|
|
|
(9
|
)
|
||||
Net current-period other comprehensive income
|
|
146
|
|
|
149
|
|
|
6
|
|
|
301
|
|
||||
Balance at September 30, 2017
|
|
$
|
(1,625
|
)
|
|
$
|
423
|
|
|
$
|
6
|
|
|
$
|
(1,196
|
)
|
|
|
|
Amount reclassified from AOCI
|
||||||||||||||
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
(In millions)
(a)
|
Details about AOCI components
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
Amortization of pension and other benefit items
|
|
|
|
|
|
|
|
|
||||||||
|
Prior service costs
(b)
|
|
$
|
8
|
|
|
$
|
(8
|
)
|
|
$
|
22
|
|
|
$
|
(27
|
)
|
|
Actuarial losses
(b)
|
|
38
|
|
|
(34
|
)
|
|
114
|
|
|
(99
|
)
|
||||
|
Settlement, termination and curtailment
(losses) (b) |
|
1
|
|
|
(10
|
)
|
|
5
|
|
|
(13
|
)
|
||||
|
Total before tax
|
|
47
|
|
|
(52
|
)
|
|
141
|
|
|
(139
|
)
|
||||
|
Tax benefit
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
|
Net of tax
(c)
|
|
$
|
47
|
|
|
$
|
(52
|
)
|
|
$
|
141
|
|
|
$
|
(139
|
)
|
|
|
Employee Related
|
|
Exit
|
|
Non-cash
|
|
|
||||||||
(in millions)
|
|
Costs
|
|
Costs
|
|
Charges
|
|
Total
|
||||||||
Balance at December 31, 2016
|
|
$
|
14
|
|
|
$
|
60
|
|
|
$
|
—
|
|
|
$
|
74
|
|
Additional charges
|
|
1
|
|
|
—
|
|
|
35
|
|
|
36
|
|
||||
Cash payments/utilization
|
|
(7
|
)
|
|
(17
|
)
|
|
(35
|
)
|
|
(59
|
)
|
||||
Other adjustments and reclassifications
|
|
(4
|
)
|
|
(2
|
)
|
|
—
|
|
|
(6
|
)
|
||||
Balance at September 30, 2017
|
|
$
|
4
|
|
|
$
|
41
|
|
|
$
|
—
|
|
|
$
|
45
|
|
(in millions)
|
|
September 30, 2017
|
|
December 31, 2016
|
||||
Accounts payable
|
|
$
|
30
|
|
|
$
|
50
|
|
Payroll and benefits payable
|
|
3
|
|
|
11
|
|
||
Employee benefits
|
|
1
|
|
|
1
|
|
||
Deferred credits and other noncurrent liabilities
|
|
11
|
|
|
12
|
|
||
Total
|
|
$
|
45
|
|
|
$
|
74
|
|
Period ended
|
|
Opening
Number of Claims |
|
Claims
Dismissed, Settled and Resolved |
|
New
Claims |
|
Closing
Number of Claims |
December 31, 2014
|
|
3,320
|
|
190
|
|
325
|
|
3,455
|
December 31, 2015
|
|
3,455
|
|
415
|
|
275
|
|
3,315
|
December 31, 2016
|
|
3,315
|
|
225
|
|
250
|
|
3,340
|
September 30, 2017
|
|
3,340
|
|
200
|
|
185
|
|
3,325
|
(In millions)
|
Nine Months Ended September 30, 2017
|
||
Beginning of period
|
$
|
179
|
|
Accruals for environmental remediation deemed probable and reasonably estimable
|
6
|
|
|
Obligations settled
|
(5
|
)
|
|
End of period
|
$
|
180
|
|
(In millions)
|
|
September 30, 2017
|
|
December 31, 2016
|
||||
Accounts payable
|
|
$
|
20
|
|
|
$
|
19
|
|
Deferred credits and other noncurrent liabilities
|
|
160
|
|
|
160
|
|
||
Total
|
|
$
|
180
|
|
|
$
|
179
|
|
(1)
|
Projects with Ongoing Study and Scope Development -
Projects which are still in the development phase. For these projects, the extent of remediation that may be required is not yet known, the remediation methods and plans are not yet developed, and/or cost estimates cannot be determined. Therefore, significant costs, in addition to the accrued liabilities for these projects, are reasonably possible. There are
six
environmental remediation projects where additional costs for completion are not currently estimable, but could be material. These projects are at Fairfield Works, Lorain Tubular, USS-POSCO Industries (UPI), the Fairless Plant, Cherryvale Zinc, and the former steelmaking plant at Joliet, Illinois. As of
September 30, 2017
, accrued liabilities for these projects totaled
$1 million
for the costs of studies, investigations, interim measures, design and/or remediation. It is reasonably possible that additional liabilities associated with future requirements regarding studies, investigations, design and remediation for these projects could be as much as
$30 million
to
$50 million
.
|
(2)
|
Significant Projects with Defined Scope -
Projects with significant accrued liabilities with a defined scope. As of
September 30, 2017
, there are
three
significant projects with defined scope greater than or equal to
$5 million
each, with a total accrued liability of
$136 million
. These projects are Gary RCRA (accrued liability of
$26 million
), the former Geneva facility (accrued liability of
$63 million
), and the former Duluth facility St. Louis River Estuary (accrued liability of
$47 million
).
|
(3)
|
Other Projects with a Defined Scope -
Projects with relatively small accrued liabilities for which we believe that, while additional costs are possible, they are not likely to be significant, and also include those projects for which we do not yet possess sufficient information to estimate potential costs to U. S. Steel. There are
two
other environmental remediation projects which each had an accrued liability of between
$1 million
and
$5 million
. The total accrued liability for these projects at
September 30, 2017
was
$4 million
. These projects have progressed through a significant portion of the design phase and material additional costs are not expected.
|
Remainder of 2017
|
|
2018
|
|
2019
|
|
2020
|
|
2021
|
|
Later
Years |
|
Total
|
$147
|
|
$734
|
|
$402
|
|
$316
|
|
$309
|
|
$1,067
|
|
$2,975
|
Item 2.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
|
|
Three Months Ended
September 30, |
|
|
|
Nine Months Ended
September 30, |
|
||||||||||||||
(Dollars in millions, excluding intersegment sales)
|
|
2017
|
|
2016
|
|
%
Change
|
|
2017
|
|
2016
|
%
Change
|
||||||||||
Flat-Rolled Products (Flat-Rolled)
|
|
$
|
2,249
|
|
|
$
|
1,986
|
|
|
13
|
%
|
|
$
|
6,265
|
|
|
$
|
5,643
|
|
11
|
%
|
U. S. Steel Europe (USSE)
|
|
710
|
|
|
575
|
|
|
23
|
%
|
|
2,123
|
|
|
1,616
|
|
31
|
%
|
||||
Tubular Products (Tubular)
|
|
276
|
|
|
114
|
|
|
142
|
%
|
|
682
|
|
|
303
|
|
125
|
%
|
||||
Total sales from reportable segments
|
|
3,235
|
|
|
2,675
|
|
|
21
|
%
|
|
9,070
|
|
|
7,562
|
|
20
|
%
|
||||
Other Businesses
|
|
13
|
|
|
11
|
|
|
18
|
%
|
|
47
|
|
|
49
|
|
(4
|
)%
|
||||
Net sales
|
|
$
|
3,248
|
|
|
$
|
2,686
|
|
|
21
|
%
|
|
$
|
9,117
|
|
|
$
|
7,611
|
|
20
|
%
|
|
|
Three Months Ended
September 30, |
|
%
Change |
|
Nine Months Ended
September 30, |
|
%
Change |
||||||||||||||
(Dollars in millions)
|
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
|
||||||||||||
Flat-Rolled
|
|
$
|
160
|
|
|
$
|
114
|
|
|
40
|
%
|
|
$
|
288
|
|
|
$
|
(68
|
)
|
|
524
|
%
|
USSE
|
|
73
|
|
|
81
|
|
|
(10
|
)%
|
|
215
|
|
|
122
|
|
|
76
|
%
|
||||
Tubular
|
|
(7
|
)
|
|
(75
|
)
|
|
91
|
%
|
|
(93
|
)
|
|
(217
|
)
|
|
57
|
%
|
||||
Total earnings (loss) from reportable segments
|
|
226
|
|
|
120
|
|
|
88
|
%
|
|
410
|
|
|
(163
|
)
|
|
352
|
%
|
||||
Other Businesses
|
|
12
|
|
|
18
|
|
|
(33
|
)%
|
|
34
|
|
|
42
|
|
|
(19
|
)%
|
||||
Segment earnings (loss) before interest and income taxes
|
|
238
|
|
|
138
|
|
|
72
|
%
|
|
444
|
|
|
(121
|
)
|
|
467
|
%
|
||||
Items not allocated to segments:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Postretirement benefit (expense) income
|
|
(14
|
)
|
|
8
|
|
|
(275
|
)%
|
|
(42
|
)
|
|
36
|
|
|
(217
|
)%
|
||||
Other items not allocated to segments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Gain associated with retained interest in U. S. Steel Canada Inc.
|
|
—
|
|
|
—
|
|
|
—
|
%
|
|
72
|
|
|
—
|
|
|
100
|
%
|
||||
Gain on equity investee transactions
|
|
21
|
|
|
—
|
|
|
100
|
%
|
|
21
|
|
|
—
|
|
|
100
|
%
|
||||
Loss on shutdown of certain tubular assets
|
|
—
|
|
|
—
|
|
|
—
|
%
|
|
(35
|
)
|
|
—
|
|
|
(100
|
)%
|
||||
Impairment of intangible assets
|
|
—
|
|
|
(14
|
)
|
|
100
|
%
|
|
—
|
|
|
(14
|
)
|
|
100
|
%
|
||||
Restructuring and other charges and related adjustments
|
|
—
|
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
(2
|
)
|
|
100
|
%
|
||||
Total earnings (loss) before interest and income taxes
|
|
$
|
245
|
|
|
$
|
132
|
|
|
86
|
%
|
|
$
|
460
|
|
|
$
|
(101
|
)
|
|
555
|
%
|
|
|
Three Months Ended
September 30, |
|
%
Change |
|
Nine Months Ended
September 30, |
|
% Change
|
||||||||||||||
|
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
|
||||||||||||
Earnings (loss) before interest and income taxes ($ millions)
|
|
$
|
160
|
|
|
$
|
114
|
|
|
40
|
%
|
|
$
|
288
|
|
|
$
|
(68
|
)
|
|
524
|
%
|
Gross margin
|
|
13
|
%
|
|
13
|
%
|
|
—
|
%
|
|
11
|
%
|
|
5
|
%
|
|
6
|
%
|
||||
Raw steel production (mnt)
|
|
2,821
|
|
|
2,734
|
|
|
3
|
%
|
|
8,247
|
|
|
8,248
|
|
|
—
|
%
|
||||
Capability utilization
|
|
66
|
%
|
|
64
|
%
|
|
2
|
%
|
|
65
|
%
|
|
65
|
%
|
|
—
|
%
|
||||
Steel shipments (mnt)
|
|
2,544
|
|
|
2,535
|
|
|
—
|
%
|
|
7,445
|
|
|
7,725
|
|
|
(4
|
)%
|
||||
Average realized steel price per ton
|
|
$
|
728
|
|
|
$
|
718
|
|
|
1
|
%
|
|
$
|
730
|
|
|
$
|
658
|
|
|
11
|
%
|
|
|
Three Months Ended
September 30, |
|
%
Change |
|
Nine Months Ended
September 30, |
|
% Change
|
||||||||||||||
|
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
|
||||||||||||
Earnings before interest and income taxes ($ millions)
|
|
$
|
73
|
|
|
$
|
81
|
|
|
(10
|
)%
|
|
$
|
215
|
|
|
$
|
122
|
|
|
76
|
%
|
Gross margin
|
|
15
|
%
|
|
20
|
%
|
|
(5
|
)%
|
|
14
|
%
|
|
14
|
%
|
|
—
|
%
|
||||
Raw steel production (mnt)
|
|
1,235
|
|
|
1,279
|
|
|
(3
|
)%
|
|
3,778
|
|
|
3,689
|
|
|
2
|
%
|
||||
Capability utilization
|
|
98
|
%
|
|
102
|
%
|
|
(4
|
)%
|
|
101
|
%
|
|
98
|
%
|
|
3
|
%
|
||||
Steel shipments (mnt)
|
|
1,067
|
|
|
1,105
|
|
|
(3
|
)%
|
|
3,333
|
|
|
3,235
|
|
|
3
|
%
|
||||
Average realized steel price per ton ($)
|
|
$
|
639
|
|
|
$
|
503
|
|
|
27
|
%
|
|
$
|
617
|
|
|
$
|
483
|
|
|
28
|
%
|
Average realized steel price per ton (€)
|
|
€
|
544
|
|
|
€
|
451
|
|
|
21
|
%
|
|
€
|
554
|
|
|
€
|
433
|
|
|
28
|
%
|
|
|
Three Months Ended
September 30, |
|
%
Change |
|
Nine Months Ended
September 30, |
|
% Change
|
||||||||||||||
|
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
|
||||||||||||
Loss before interest and income taxes ($ millions)
|
|
$
|
(7
|
)
|
|
$
|
(75
|
)
|
|
91
|
%
|
|
$
|
(93
|
)
|
|
$
|
(217
|
)
|
|
57
|
%
|
Gross margin
|
|
4
|
%
|
|
(43
|
)%
|
|
47
|
%
|
|
(5
|
)%
|
|
(45
|
)%
|
|
40
|
%
|
||||
Steel shipments (mnt)
|
|
185
|
|
|
103
|
|
|
80
|
%
|
|
509
|
|
|
262
|
|
|
94
|
%
|
||||
Average realized steel price per ton
|
|
$
|
1,433
|
|
|
$
|
1,049
|
|
|
37
|
%
|
|
$
|
1,268
|
|
|
$
|
1,094
|
|
|
16
|
%
|
|
|
Three Months Ended
September 30, |
|
%
Change
|
|
Nine Months Ended
September 30, |
|
%
Change |
||||||||||||||
(Dollars in millions)
|
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
|
||||||||||||
Interest expense
|
|
$
|
60
|
|
|
$
|
58
|
|
|
3
|
%
|
|
$
|
173
|
|
|
$
|
173
|
|
|
—
|
%
|
Interest income
|
|
(5
|
)
|
|
(2
|
)
|
|
150
|
%
|
|
(13
|
)
|
|
(5
|
)
|
|
160
|
%
|
||||
Loss on debt extinguishment
|
|
31
|
|
|
—
|
|
|
100
|
%
|
|
32
|
|
|
22
|
|
|
45
|
%
|
||||
Other financial costs (income)
|
|
12
|
|
|
6
|
|
|
100
|
%
|
|
37
|
|
|
18
|
|
|
106
|
%
|
||||
Total net interest and other financial costs
|
|
$
|
98
|
|
|
$
|
62
|
|
|
58
|
%
|
|
$
|
229
|
|
|
$
|
208
|
|
|
10
|
%
|
|
|
Three Months Ended
September 30, |
|
Twelve Months Ended
September 30, |
||||||||
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||
Accounts Receivable Turnover
|
|
2.2
|
|
|
2.2
|
|
|
8.6
|
|
|
8.0
|
|
Inventory Turnover
|
|
1.6
|
|
|
1.4
|
|
|
6.1
|
|
|
4.7
|
|
(Dollars in millions)
|
|
|
||
|
Cash and cash equivalents
|
$
|
1,694
|
|
|
Amount available under $1.5 Billion Credit Facility
|
1,500
|
|
|
|
Amount available under USSK credit facilities
|
294
|
|
|
|
Total estimated liquidity
|
$
|
3,488
|
|
UNITED STATES STEEL CORPORATION
|
||||
RECONCILIATION OF ANNUAL ADJUSTED EBITDA OUTLOOK
|
||||
|
|
|
||
|
|
Year Ended
|
||
|
|
Dec. 31
|
||
(Dollars in millions)
|
2017
|
|||
Reconciliation to Projected Annual Adjusted EBITDA Included in Outlook
|
|
|||
|
Projected net earnings attributable to United States Steel Corporation included in Outlook
|
$
|
323
|
|
|
Gain associated with retained interest in U. S. Steel Canada Inc.
|
(72
|
)
|
|
|
Gain on equity investee transactions
|
(21
|
)
|
|
|
Loss on shutdown of certain tubular assets
|
35
|
|
|
|
Loss on debt extinguishment and other related costs
|
35
|
|
|
|
Adjusted net earnings attributable to United States Steel Corporation included in Outlook
|
$
|
300
|
|
|
Estimated income tax expense
|
10
|
|
|
|
Estimated net interest and other financial costs
|
250
|
|
|
|
Estimated depreciation, depletion and amortization
|
515
|
|
|
|
Projected annual adjusted EBITDA included in Outlook
|
$
|
1,075
|
|
Item 3.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
Item 4.
|
CONTROLS AND PROCEDURES
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended September 30,
|
||||||||||||
(Dollars in millions)
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
SEGMENT EARNINGS (LOSS) BEFORE INTEREST AND INCOME TAXES:
|
|
|
|
|
|
|
|
|
||||||||
Flat-Rolled
|
|
$
|
160
|
|
|
$
|
114
|
|
|
$
|
288
|
|
|
$
|
(68
|
)
|
U. S. Steel Europe
|
|
73
|
|
|
81
|
|
|
215
|
|
|
122
|
|
||||
Tubular
|
|
(7
|
)
|
|
(75
|
)
|
|
(93
|
)
|
|
(217
|
)
|
||||
Total reportable segments
|
|
226
|
|
|
120
|
|
|
410
|
|
|
(163
|
)
|
||||
Other Businesses
|
|
12
|
|
|
18
|
|
|
34
|
|
|
42
|
|
||||
Items not allocated to segments:
|
|
|
|
|
|
|
|
|
||||||||
Postretirement benefit (expense) income
|
|
(14
|
)
|
|
8
|
|
|
(42
|
)
|
|
36
|
|
||||
Other items not allocated to segments:
|
|
|
|
|
|
|
|
|
||||||||
Gain associated with retained interest in U. S. Steel Canada Inc.
|
|
—
|
|
|
—
|
|
|
72
|
|
|
—
|
|
||||
Gain on equity investee transactions
|
|
21
|
|
|
—
|
|
|
21
|
|
|
—
|
|
||||
Loss on shutdown of certain tubular assets
|
|
—
|
|
|
—
|
|
|
(35
|
)
|
|
—
|
|
||||
Impairment of intangible assets
|
|
—
|
|
|
(14
|
)
|
|
—
|
|
|
(14
|
)
|
||||
Restructuring and other charges and adjustments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
||||
Total earnings (loss) before interest and income taxes
|
|
$
|
245
|
|
|
$
|
132
|
|
|
$
|
460
|
|
|
$
|
(101
|
)
|
CAPITAL EXPENDITURES
|
|
|
|
|
|
|
|
|
||||||||
Flat-Rolled
|
|
$
|
134
|
|
|
$
|
23
|
|
|
$
|
206
|
|
|
$
|
97
|
|
U. S. Steel Europe
|
|
28
|
|
|
17
|
|
|
62
|
|
|
68
|
|
||||
Tubular
|
|
8
|
|
|
11
|
|
|
19
|
|
|
81
|
|
||||
Other Businesses
|
|
1
|
|
|
—
|
|
|
4
|
|
|
22
|
|
||||
Total
|
|
$
|
171
|
|
|
$
|
51
|
|
|
$
|
291
|
|
|
$
|
268
|
|
OPERATING STATISTICS
|
|
|
|
|
|
|
|
|
||||||||
Average realized price: ($/net ton)
(a)
|
|
|
|
|
|
|
|
|
||||||||
Flat-Rolled
|
|
$
|
728
|
|
|
$
|
718
|
|
|
$
|
730
|
|
|
$
|
658
|
|
U. S. Steel Europe
|
|
639
|
|
|
503
|
|
|
617
|
|
|
483
|
|
||||
Tubular
|
|
1,433
|
|
|
1,049
|
|
|
1,268
|
|
|
1,094
|
|
||||
Steel Shipments:
(a)(b)
|
|
|
|
|
|
|
|
|
||||||||
Flat-Rolled
|
|
2,544
|
|
|
2,535
|
|
|
7,445
|
|
|
7,725
|
|
||||
U. S. Steel Europe
|
|
1,067
|
|
|
1,105
|
|
|
3,333
|
|
|
3,235
|
|
||||
Tubular
|
|
185
|
|
|
103
|
|
|
509
|
|
|
262
|
|
||||
Intersegment Shipments:
(b)
|
|
|
|
|
|
|
|
|
||||||||
Flat-Rolled to Tubular
|
|
43
|
|
|
—
|
|
|
137
|
|
|
42
|
|
||||
U. S. Steel Europe to Flat-Rolled
|
|
—
|
|
|
—
|
|
|
47
|
|
|
—
|
|
||||
Raw Steel Production:
(b)
|
|
|
|
|
|
|
|
|
||||||||
Flat-Rolled
|
|
2,821
|
|
|
2,734
|
|
|
8,247
|
|
|
8,248
|
|
||||
U. S. Steel Europe
|
|
1,235
|
|
|
1,279
|
|
|
3,778
|
|
|
3,689
|
|
||||
Raw Steel Capability Utilization:
(c)
|
|
|
|
|
|
|
|
|
||||||||
Flat-Rolled
|
|
66
|
%
|
|
64
|
%
|
|
65
|
%
|
|
65
|
%
|
||||
U. S. Steel Europe
|
|
98
|
%
|
|
102
|
%
|
|
101
|
%
|
|
98
|
%
|
Period ended
|
|
Opening
Number of Claims |
|
Claims
Dismissed, Settled and Resolved |
|
New
Claims |
|
Closing
Number of Claims |
December 31, 2014
|
|
3,320
|
|
190
|
|
325
|
|
3,455
|
December 31, 2015
|
|
3,455
|
|
415
|
|
275
|
|
3,315
|
December 31, 2016
|
|
3,315
|
|
225
|
|
250
|
|
3,340
|
September 30, 2017
|
|
3,340
|
|
200
|
|
185
|
|
3,325
|
Item 4.
|
MINE SAFETY DISCLOSURES
|
Item 5.
|
OTHER INFORMATION
|
Item 6.
|
EXHIBITS
|
10.1
|
|
|
|
|
|
31.1
|
|
|
|
|
|
31.2
|
|
|
|
|
|
32.1
|
|
|
|
|
|
32.2
|
|
|
|
|
|
95
|
|
|
|
|
|
101 INS
|
|
XBRL Instance Document
|
|
|
|
101 SCH
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
101 CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
101 DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
101 LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
|
|
101 PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
UNITED STATES STEEL CORPORATION
|
||
|
|
|
By
|
|
/s/ Colleen M. Darragh
|
|
|
|
|
|
Colleen M. Darragh
|
|
|
Vice President & Controller
|
|
United States Steel Corporation
600 Grant Street
Pittsburgh, PA 15219-2800
412 433 1125
bmelnkovic@uss.com
|
Barry Melnkovic
Vice President & Chief
Human Resources Officer
|
•
|
Up to six months of temporary living expense in the Pittsburgh area
|
•
|
Two house hunting trips for you and your spouse
|
•
|
One-way movement of household goods and personal effects
|
•
|
Transportation for you and your family to relocate to Pittsburgh
|
•
|
Closing costs on the sale of your current residence and purchase of your future residence
|
•
|
Loss on sale benefit up to a maximum of $30,000, which represents the difference between the origin home purchase price and the end-out sales price based on HUD-1 documents
|
(1)
|
Vacation: As an experienced hire at the Executive Vice President level, you will be eligible to receive five weeks of vacation annually. In 2017, your vacation will be prorated based on your hire date.
|
(2)
|
Retirement Account: You will participate in the Retirement Account under the Savings Fund Plan for Salaried Employees and be eligible for monthly company contributions in the amount of 8.5% of your base salary. You will participate in a non tax-qualified restoration plan (the “Non Tax-Qualified Retirement Account Program”) with respect to the portion of the company contributions to your Retirement Account that cannot be made due to certain Internal Revenue Code (IRC) limitations. In general, you will vest in your Retirement Account under the Savings Fund Plan and your account under the Non-Tax Qualified Retirement Account Program after you complete three years of continuous service.
|
(3)
|
Company Matching Contributions: You will be eligible to make employee contributions on a pre-tax and/or after-tax basis to the Savings Account under the Savings Fund Plan for salaried employees not to exceed 16% of your base salary subject to limitations under the IRC. You will also be eligible for company contributions that match 100% of your employee contributions up to 6.0% of your base salary (subject to the IRC limitations.) You will participate in a non tax-qualified restoration plan (the “Supplemental Thrift Program”) with respect to the portion of company contributions to your Savings Account that cannot be made due to certain IRC limitations. In general, you will vest in your company matching contributions under the Savings Fund Plan after you complete three years of continuous service and in the Supplemental Thrift Program after you complete five years of continuous service.
|
(4)
|
Supplemental Retirement Account: As an executive with the company, you will be eligible to participate in the Supplemental Retirement Account Program (SRA.) Under the SRA, you will be eligible for book accruals in the amount of 8.5% of your Annual Incentive Compensation, when earned. In order to vest in the SRA benefit, a participant must be at least age 55, have at least 10 years of continuous service and must be a participant in the plan for at least three years.
|
|
|
|
Kevin Bradley
|
|
Date
|
1.
|
I have reviewed this quarterly report on Form 10-Q of United States Steel Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
November 1, 2017
|
|
/s/ David B. Burritt
|
|
|
David B. Burritt
|
|
|
President and Chief Executive Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of United States Steel Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
November 1, 2017
|
|
/s/ Kevin P. Bradley
|
|
|
Kevin P. Bradley
|
|
|
Executive Vice President
|
|
|
and Chief Financial Officer
|
(1)
|
The Quarterly Report on Form 10-Q of United States Steel Corporation for the period ending
September 30, 2017
, fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the foregoing report fairly presents, in all material respects, the financial condition and results of operations of United States Steel Corporation.
|
/s/ David B. Burritt
|
David B. Burritt
|
President and Chief Executive Officer
|
(1)
|
The Quarterly Report on Form 10-Q of United States Steel Corporation for the period ending
September 30, 2017
, fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the foregoing report fairly presents, in all material respects, the financial condition and results of operations of United States Steel Corporation.
|
/s/ Kevin P. Bradley
|
Kevin P. Bradley
|
Executive Vice President
|
and Chief Financial Officer
|
Mine (Federal Mine Safety and
Health Administration (MSHA) ID)
|
Total # of
Significant &
Substantial
violations
under
§104(a)
(a)
|
|
Total # of
orders
under
§104(b)
(a)
|
|
Total # of
unwarrantable
failure
citations and
orders under
§104(d) (a) |
|
Total # of
violations
under
§110(b)(2)
(a)
|
|
Total # of
orders
under
§107(a)
(a)
|
|
Total dollar
value of
proposed
assessments
from
MSHA
|
|
Total # of
mining
related
fatalities
|
|
Received
Notice of
Pattern of
Violations
under
§104(e)
(a)
(yes/no)?
|
|
Received Notice
of Potential to
have Pattern
under
§104(e)
(a)
(yes/no)?
|
|
Total # of Legal
Actions Pending
with the Mine
Safety and
Health Review
Commission as
of Last Day of
Period (b) |
|
Legal
Actions
Initiated
During
Period
|
|
Legal
Actions
Resolved
During
Period
|
|
Mt. Iron
(2100820, 2100282)
|
—
|
|
|
—
|
|
—
|
|
—
|
|
—
|
|
$317,671
|
|
—
|
|
no
|
|
no
|
|
95
|
|
80
|
|
50
|
Keewatin
(2103352)
|
8
|
|
|
—
|
|
—
|
|
—
|
|
—
|
|
46,973
|
|
—
|
|
no
|
|
no
|
|
38
|
|
6
|
|
—
|
(a)
|
References to Section numbers are to sections of the Federal Mine Safety and Health Act of 1977.
|
(b)
|
Includes all legal actions pending before the Federal Mine Safety and Health Review Commission, together with the Administrative Law Judges thereof, for each of our iron ore operations. These actions may have been initiated in prior quarters. All of the legal actions were initiated by us to contest citations, orders or proposed assessments issued by the Federal Mine Safety and Health administration, and if we are successful, may result in the reduction or dismissal of those citations, orders or assessments. As of the last day of the period, all 168 legal actions were to contest citations and proposed assessments.
|