United States Steel Corporation · NYSE:X
United States Steel — Q3 2022 Earnings Presentation
20 slides from United States Steel's earnings presentation, Oct 28, 2022
Slide 1: Third Quarter 2022 Earnings Call
Third Quarter 2022 Earnings Call October 28, 2022 David Burritt President and Chief Executive Officer Jessica Graziano SVP and Chief Financial Officer Rich Fruehauf SVP, Chief Strategy and Sustainability Officer Kevin Lewis VP, Investor Relations and Corporate FP&A
Slide 2: Legal disclaimers
Legal disclaimers 2 2 These slides are being provided to assist readers in understanding the results of operations, financial condition and cash flows of United States Steel Corporation as of and for the third quarter 2022. Financial results as of and for the periods ended September 30, 2022 provide
Slide 3: Explanation of use of non-GAAP measures
Explanation of use of non-GAAP measures 3 3 We present earnings before interest, income taxes, depreciation and amortization (EBITDA) and adjusted EBITDA, which are non-GAAP measures, as additional measurements to enhance the understanding of our operating performance. We believe that EBITDA, consid
Slide 4: Advancing towards our Best for All future
Advancing towards our Best for All® future 4 4 CURRENT LANDSCAPE CHALLENGES SOLUTION PATH FORWARD Bullish on U. S. Steel’s future Delivering on Best for All Transitioning to a less capital- and carbon- intensive business model while becoming the best steel competitor Balanced capital allocation fram
Slide 5: Today's highlights
5 5 Today’s highlights RETURNING CAPITAL TO STOCKHOLDERS OPERATING FROM A POSITION OF STRENGTH SAFELY NAVIGATING CURRENT HEADWINDS
Slide 6: Operating from a position of strength: Improved business model
6 6 Operating from a position of strength Improved business model STRONGER AND REVITALIZED NAFR1 ASSET BASE LOWER CARBON AND LOWER CAPITAL INTENSITY FLEXIBLE AND SUSTAINABLE MINI MILL STEELMAKING 1 NAFR = North American Flat-Rolled segment.
Slide 7: Operating from a position of strength: Transformed balance sheet
7 7 Operating from a position of strength Transformed balance sheet $0.0B 20292022 20252023 $0.0B 20282024 2026 2027 $0.1B 20332030 2031 $0.0B 2032 2034 2035+ $0.0B$0.0B $1.8B $0.1B $0.1B $0.0B $0.5B $0.0B $1.2B $0.0B U. S. Steel Big River Steel Debt maturity profile, in billions, as of 9/30/2022 St
Slide 8: Operating from a position of strength: Pre-funded investments
8 8 Operating from a position of strength Pre-funded investments Record cash & liquidity support strategic capex, as of 9/30/2022 1 Strategic capex includes Gary pig iron machine, Big River 2 (BR2), BRS non-grain oriented (NGO) electrical steel line, BRS coating line, and Keetac DR-grade pellet upgr
Slide 9: Safely navigating current headwinds: Business update
9 9 NA Flat-rolled Mini Mill U. S. Steel Europe Tubular Safely navigating current headwinds Business update Market Conditions Management Actions Demand soft; cautious buying continues Steel prices stabilizing above historical norms Adjusted integrated steelmaking footprint Leveraging diverse end-mar
Slide 10: Returning capital to stockholders: Balanced capital allocation approach
10 10 Returning capital to stockholders Balanced capital allocation approach PRIORITIES CONSIDERATIONS OBJECTIVES 1 Balance sheet strength Through-cycle adjusted debt to EBITDA range 3.0x – 3.5x range 2 Announced Best for All investments Cash to NTM1 capex and cash of no less than $1.5B 1:1 ≥ $1.5B
Slide 11: Advancing towards our Best for All future: 3Q 2022 results
11 11 Advancing towards our Best for All future 3Q 2022 results In the third quarter 2022: Adjusted EBITDA $848M Supporting 16% enterprise EBITDA Adjusted EPS $1.95 Top end of our guidance range Free cash flow $599M Contributing to record cash and record liquidity
Slide 12: Creating value today with stock buybacks
12 12 Balanced capital allocation approach Creating value today with stock buybacks ~301M 263M -13% Diluted-equivalent share count1 In million shares As of Sept. 30, 2021 As of Sept. 30, 2022 $850M $300M stock buyback (announced Oct. ’21) $500M stock buyback (announced Jan. ’22) $150M Completed in 4
Slide 13: Investing in competitive advantages
$1,110M 2024E2021 $800M $1,710M 2023E2022E $320M Expected strategic CAPEX: Best-in-class finishing Mini mill steelmaking Low-cost iron ore ~$250M ~$650M ~$1,350M ~$750M ~$385M ~$235M ~$40M ~$75M ~$125M ~$10M Advancing towards our Best for All future Investing in competitive advantages ~$70M 2022 tot
Slide 14: Advancing towards our Best for All future
14 14 Advancing towards our Best for All future OPERATING FROM A POSITION OF STRENGTH SAFELY NAVIGATING CURRENT HEADWINDS RETURNING CAPITAL TO STOCKHOLDERS
Slide 15: Q&A
Q&A Big River 2 construction
Slide 16: Closing Remarks
aK Ke AMERICA’S MOST LOVED WORKPLACES 2022 Best Practice Institute | Closing Remarks
Slide 17: Reconciliation of segment EBITDA
Flat-rolled ($ millions) 3Q 2022 Segment (loss) earnings before interest and income taxes $505 Depreciation 126 Flat-rolled Segment EBITDA $631 U. S. Steel Europe ($ millions) 3Q 2022 Segment (loss) earnings before interest and income taxes ($32) Depreciation 22 U. S. Steel Europe Segment EBITDA ($1
Slide 18: Reconciliation of adjusted EBITDA
Reconciliation of adjusted EBITDA 18 ($ millions) 3Q 2022 Reported net earnings attributable to U. S. Steel $490 Income tax provision (benefit) 154 Net interest and other financial costs (30) Reported earnings before interest and income taxes $614 Depreciation, depletion and amortization expense 198
Slide 19: Reconciliation of free cash flow
Reconciliation of free cash flow 19 ($ millions) 3Q 2022 Cash provided by operating activities $1,074 Cash used in investing activity (463) Dividends paid (12) Free cash flow $599
Slide 20: Investor Relations
INVESTOR RELATIONS Kevin Lewis Vice President 412-433-6935 klewis@uss.com Eric Linn Director 412-433-2385 eplinn@uss.com www.ussteel.com @USS_Investors