United States Steel Corporation’s (X) Slovak unit will reduce working hours from January due to the tougher economic environment in Europe.
As per the new arrangement, workers will have to stay at home every Friday, and will receive 60% of their salary. U.S. Steel’s plant in Kosice, eastern Slovakia, has about 13,000 employees and its output accounts for 0.5% of the east European country’s gross domestic product.
Other carmakers in Slovakia also use a similar flexible system of leaving workers at home based on demand.
U.S. Steel, the largest U.S. steelmaker by volume, will continue to operate at the Lake Erie and Hamilton plants in Ontario until 2015, according to the statement. It will also contribute C$3 million toward community and education programs in Hamilton and Nanticoke.
In October 2011, U. S. Steel reported third-quarter 2011 adjusted net income of $118 million or 72 cents per share, exceeding the Zacks Consensus Estimate of 55 cents per share.
The net income excluded $96 million or 57 cents per share of net foreign currency losses, primarily related to the accounting re-measurement of the inter company loans. Including this, net income came in at $22 million, or 15 cents per diluted share versus net loss of $51 million or loss of 35 cents per diluted share.
U.S. Steel competes with international steel giants like ArcelorMittal (MT), BaoSteel, Posco (PKX), Nippon Steel and ThyssenKrupp.
We maintain our Neutral recommendation on United Steel with its quantitative Zacks #3 Rank (short-term Hold rating).
