Earnings rise 32 percent in third quarter
PITTSBURGH (AP) _ A construction boom and surging demand for steel tubes helped USX Corp. post a 32 percent increase Wednesday in its third-quarter earnings.
The steel and energy conglomerate also announced it will sell its natural gas processing business, Delhi Group, to an affiliate of Koch Industries Inc. for $762 million. The deal would result in payments of $19 to $21 per share to holders of USX-Delhi common stock.
USX earned $307 million in the quarter ended Sept. 30 compared with $233 million a year ago. USX does not provide per-share results because stock in its three divisions trade separately.
``It’s significantly higher than I think most analysts had expected,″ said Michael Locker of Locker Associates in New York.
Sales rose to $6.048 billion for the quarter from $6.028 billion a year ago.
The U.S. Steel Group reported earnings increased to $116 million, or $1.32 per share, from $70 million, or 76 cents per share, a year earlier. Sales edged up to $1.7 billion from $1.6 billion.
Ken Hoffman, an analyst with Prudential Securities, called the results ``a very positive earnings surprise.″
He credited U.S. Steel for working with its unions to cut steel production costs and predicted that it would continue to trim payrolls over the next three years to compete with largely non-union mini-mills.
The Marathon Oil Group enjoyed its best third quarter since the group was formed in 1991, due largely to higher profit margins in refining and transportation.
Net income was $192 million, or 66 cents per share, compared to $164 million, or 57 cents per share, a year ago. Revenue fell to $3.9 billion from $4.2 billion.
Quarterly earnings benefited from a $26 million tax credit resulting from a revaluation of inventories to lower, market prices.
The Delhi Group, which processes and transports natural gas, posted a loss of $600,000, or 6 cents per share, compared to a loss of $1.2 million, or 14 cents per share, in the same period a year ago.
In the first nine months, USX earned $717 million, up from $652 million during the same period in 1996. Revenue rose to $17.8 billion from $17.3 billion.
USX Steel shares gained $1.50 to close at $36.12 1/2 on the New York Stock Exchange. USX Marathon was off 93 3/4 cents a share at $36.56 1/4 and USX Delhi was up $2.68 3/4 at $19.18 3/4.