AK Steel Holding Corporation ( AKS ) announced that members of the United Steelworkers (USW) international union have ratified a new 4-year labor agreement, effective Mar 1, 2015. The agreement covers 215 hourly production and maintenance employees at the company's Mountain State Carbon cokemaking plant in Follansbee, WV.
It will be a competitive contract for AK Steel and the employees of Mountain State Carbon. In Sep 2014, AK Steel acquired Severstal Dearborn, LLC and also Mountain State Carbon as part of the buyout. The USW had earlier represented Mountain State Carbon employees for collective bargaining purposes under a previous owner of the plant. However no negotiation took place for the labor agreement at the time of AK Steel's acquisition of the plant.
In fourth-quarter 2014, AK Steel's profit was lower owing to higher operating costs, but its earnings topped expectations. The company posted a profit of $13.5 million or 7 cents per share in the quarter, a roughly 62% decrease from $35.2 million or 26 cents per share logged in the year-ago quarter.
Barring costs related to pension/other post retirement benefits and the acquisition of Severstal Dearborn, the Ohio-based steel maker's earnings were 14 cents per share, surpassing the Zacks Consensus Estimate of 6 cents.
AK Steel, which is among the prominent steel makers along with U.S. Steel ( X ), plans to announce detailed guidance for first-quarter 2015 in March.
AK Steel currently carries a Zacks Rank #3 (Hold).
Other stocks in the steel sector worth considering include Kobe Steel Ltd. ( KBSTY ) and LB Foster Co. ( FSTR ). While Kobe Steel sports a Zacks Rank #1 (Strong Buy), LB Foster holds a Zacks Rank #2 (Buy).
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