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AK Steel Holding Corporation (NYSE:AKS) announced that it had reached a new labor agreement with some 1,200 union employees at its Butler Works facility. The deal is worth revisiting to know what the agreement means, what AK Steel revealed about it and what the company decided to keep under wraps.

Two-year labor agreement

AK Steel has been in labor talks with the United Auto Workers Local 3303 that represents its hourly union workers at the Butler Works facility. After a period of negotiation, a deal was reached. Therefore, on August 8 and August 9, the workers voted to approve the labor agreement that covers two and a half years until April 2019. The ratification vote came at 576-390.

The old agreement

The new labor agreement that AK Steel has entered into with its Butler Works employees will replace the existing one that was supposed to run between October 1, 2012 and October 1, 2016. The former agreement was reached in July 2012.

AK Steel noted in a statement that the early agreement with its Butler Works employees removes uncertainty in the operations of the facility. The company added that the new agreement puts it in a great position to continue addressing the future needs of its customers.

AK Steel’s Butler Works plant produces a range of flat-rolled steel products as well as a variety of stainless and carbon steels.

What AK Steel never told you

As much as AK Steel tried to share most of the important information regarding its new agreement with its union employees at the Butler Works facility, the company sat on some details. For instance, the company didn’t reveal the financial terms of the deal.

How AK Steel fared in 2Q

A look at AK Steel’s most recent financial performance scorecard shows that the company posted EPS profit of $0.08 in 2Q2016. That was better than EPS loss of $0.36 in the same quarter last year. AK Steel also exceeded the expectation of Wall Street that called for EPS of $0.04.

However, revenue of $1.49 billion that AK Steel generated in 2Q fell 11.8% YoY and missed the consensus estimate of $1.51 billion. Product shipment also declined in 2Q and the company said that it expects a modest decline in the current quarter as well.

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Steve Kanaval: Portfolio Manager/Writer/ Market Analyst Steve began his career in the Trading Pits in Chicago making markets at the Chicago Mercantile Exchange (NYSE:CME) the Chicago Board of Trade and the CBOE in the early 80’s. He ran the Morgan Stanley Derivative Prop Trading for the firm specializing in Index Arbitrage. He continued his career as a Trader/Portfolio Manager for multiple Hedge Funds during the Internet Boom of the 90’s managing large portfolios. Steve is known as an expert in MicroCap Technology Stocks and the emerging Digital Currency markets as a Portfolio Manager for his Family Office. Steve has managed portfolio’s in volatile asset classes for 3 decades as a commodity trader, hedge fund manager and digital currency trader and miner. Steve publishes his views on the asset classes in a public forum and has published more than 10,000 articles simplifying these complex and volatile assets for readers. His work is published on multiple sites including Bloomberg, Equities.com, Hacked.com, CryptoCurrencyNews as a paid contributor. His work includes research, journalism and archived video on important market volatility related to stocks, digital currency and other volatile misunderstood asset classes. He offers a humorous, unique insight and the related back stories and drivers for readers interested in volatility and emerging market assets. Full disclosure Steve is long 25 digital currencies and sits on the board of multiple public companies involved in digital currencies, and owns shares in these companies from time to time.

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