United States Steel Corporation · NYSE:X
United States Steel — Q3 2020 Earnings Presentation
18 slides from United States Steel's earnings presentation, Oct 30, 2020
Slide 1: Third Quarter 2020 Earnings Call
Third Quarter 2020 Earnings Call David Burritt President and Chief Executive Officer Christie Breves Senior Vice President and Chief Financial Officer Rich Fruehauf Senior Vice President, Chief Strategy and Development Officer Kevin Lewis Vice President, Investor Relations and Corporate FP&A October
Slide 2: Forward-looking Statements
Forward-looking Statements These slides are being provided to assist readers in understanding the results of operations, financial condition and cash flows of United States Steel Corporation for the third quarter of 2020. They should be read in conjunction with the consolidated financial statements
Slide 3: Explanation of Use of Non-GAAP Measures
Explanation of Use of Non-GAAP Measures We present adjusted net (loss) earnings, adjusted net (loss) earnings per diluted share, (loss) earnings before interest, income taxes, depreciation and amortization (EBITDA) and adjusted EBITDA, which are non-GAAP measures, as additional measurements to enhan
Slide 4: Business Update
Business Update What you will hear on today’s call: 1 OPTIMISM … continued confidence in the market recovery underway 2 OPTIMISM … actions we’ve taken are translating to improved results 3 OPTIMISM … executing on our strategy 4
Slide 5: Executing on the strategy in an unprecedented environment
Executing on the strategy executing in an unprecedented environment Objective: Status: Details: Protect lives and Industry leading livelihoods ✓ safety performance Strengthen cash Nearly $2.9 billion liquidity and and liquidity ✓ nearly $1.7 billion in cash Create incremental value Monetized excess
Slide 6: Executing on our strategy: delivering on the Big River value proposition
Executing on our strategy delivering on the Big River value proposition Delivering on the Step-1 value proposition: Combining U. S. Steel R&D and Big River technology to The product qualities The U. S. Steel grades ✓ expand product capabilities wewe have have successfully achieved for customers work
Slide 7: Big River value proposition proof points of value creation
Executing on our strategy delivering on the Big River value proposition Proof points of value creation: 11 1 ~2 Steel grades1 Only LEED certified Months ahead of steel production globally2 schedule Collaborating on steel Positioned to ultimately Superior project grades, including substrate meet cust
Slide 8: Big River phase two expansion
Executing on our strategy Big River phase two expansion Doubling steelmaking capacity from 1.65mnt to 3.3mnt1 Only adding ~100 more employees to create significant operating leverage First Phase Two coil expected in November 2020 1 mnt = million net tons; annual steelmaking capacity. 8
Slide 9: Continued confidence in the recovery: sustainable market conditions
Continued confidence in the recovery sustainable market conditions Strong customer demand and low The reasons customer inventories we are confident Inventory restocks expected to support winter steel demand Long lead times give us visibility into 2021 9
Slide 10: Continued confidence in the recovery: strategic projects status
Continued confidence in the recovery strategic projects status Strategic Projects Status Details First arc in October. EAF to supply EAF at Tubular rounds for our seamless pipe ✓ production. Endless Casting and Purchasing equipment and expect to draw on our export credit agreement in Rolling at Mon
Slide 11: Third quarter 2020 financial highlights
Actions translating to improved results third quarter 2020 financial highlights Flat-rolled Segment EBITDA1 $ Millions ($33) • Total third quarter adjusted EBITDA1 of EBITDA1 ($203) ($49) million, ahead of our guidance Margin: 2Q 2020 3Q 2020 (13%) (2%) on September 18 U. S. Steel Europe Segment EBI
Slide 12: Recap
Recap • Optimistic about the recovery that has continued into the fourth quarter • Optimistic that the actions we’ve taken are translating into improved results • Optimistic about the continued execution of our world competitive, “Best of Both” strategy 12
Slide 13: Q&A
Q&A
Slide 14: Closing Remarks
Closing Remarks Team from Fairfield Tubular visits Big River Steel for training and knowledge sharing
Slide 15: Reconciliation of segment EBITDA
Reconciliation of segment EBITDA Segment EBITDA – Flat-rolled 2Q 2020 3Q 2020 ($ millions) Segment earnings before interest and income taxes ($329) ($159) Depreciation 126 126 Flat-rolled Segment EBITDA ($203) ($33) Segment EBITDA – U. S. Steel Europe 2Q 2020 3Q 2020 ($ millions) Segment earnings be
Slide 16: Reconciliation of adjusted EBITDA
Reconciliation of adjusted EBITDA ($ millions) 2Q 2020 3Q 2020 Reported net (loss) earnings attributable to U. S. Steel ($589) ($234) Income tax provision (benefit) (5) (24) Net interest and other financial costs 62 47 Reported (loss) earnings before interest and income taxes ($532) ($211) Depreciat
Slide 17: Reconciliation of free cash flow
Reconciliation of free cash flow 1Q 2Q 3Q 9M ($ millions) 2020 2020 2020 2020 Cash provided by operating activities ($142) ($220) $213 ($149) Cash used in investing activities (277) (176) (134) (587) Dividends paid (2) (1) (3) (6) Free Cash Flow ($421) ($397) $76 ($742) 17
Slide 18: Investor Relations
INVESTOR RELATIONS Kevin Lewis Vice President 412-433-6935 klewis@uss.com Eric Linn Senior Manager 412-433-2385 eplinn@uss.com www.ussteel.com