AK Steel Posts Second Quarterly Loss

Steel producer AK Steel ( AKS) posted its second consecutive quarterly loss, in another example of how severely the recession has stressed the industry.

Weaker demand for the metal resulted in a loss of $73.4 million, or 67 cents per share, compared to a profit of $101.1 million, or 90 cents a share, a year earlier. Quarterly revenue slid 49% to $922.2 million.

But the loss was less than expected by analysts polled by Thomson Reuters, a fact that sent shares up 10% to $11.29 in morning trading. Analysts expected a loss of 75 cents a share on revenue of $929.3 million.

As the steel market has melted down, AK Steel has scaled down production, reduced pay and laid off workers. In January, it warned of a significant operating loss for the first quarter, partly due to plans to idle its Middletown, Ohio, blast furnace for 45 days for maintenance starting in early March.

Plummeting vehicle sales at General Motors, Ford and Chrysler have meant lower sales for AK Steel, which supplies the Detroit automakers with steel used in exhaust systems, among other things. It also sells the metal to auto industry suppliers.

AK Steel projected a smaller operating loss of $50 million for the second quarter, as a result of lower raw-material costs. The Associated Press contributed to this report.

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