US Steel Unveils Its Plans to Survive the COVID-19 Carnage
247 Wallst - The economic data is becoming bad enough that very few businesses are able to make any great forecasts mow. What is visible is that the situation has become dire for many companies as the global economy has been grinding down. United States Steel Corp. (NYSE: X) was the latest of the large industrial companies to announce that the coronavirus pandemic is bringing serious pain to their businesses. The impact from COVID-19 was said to be sudden and with significant changes in global oil and gas markets.
In an effort to prioritize cash and liquidity, U.S. Steel wants to remain well prepared for when the global economy ultimately recovers. The plans include reducing capital spending in 2020 by $125 million to approximately $750 million, along with idling plants. It also drew down its revolving credit facility by $800 million in order to increase its cash position.
While none of the items are expected to materially change the first-quarter results, U.S. Steel expects a meaningful reduction in demand for the full fiscal year, and it cannot determine the forward guidance for 2020.