1163302--2/24/2009--UNITED_STATES_STEEL

related topics

{cost, regulation, environmental}

{condition, economic, financial}

{gas, price, oil}

{debt, indebtedness, cash}

{customer, product, revenue}

{financial, litigation, operation}

{operation, international, foreign}

{capital, credit, financial}

{cost, contract, operation}

{cost, operation, labor}

{system, service, information}

{operation, natural, condition}

{provision, law, control}

{acquisition, growth, future}

{loss, insurance, financial}

{personnel, key, retain}

Risk Factors Concerning the Current Global Recession U. S. Steel s end product markets have been severely affected. U. S. Steel may not be able to access financial markets and there may be difficulty drawing upon existing financial agreements. U. S. Steel may face increased risks of customer and supplier defaults. U. S. Steel s joint ventures and other equity investees are also being affected by the current global recession. Risk Factors Concerning the Steel Industry Steel consumption is cyclical and worldwide overcapacity in the steel industry and the availability of alternative products have resulted in intense competition, which may have an adverse effect on profitability and cash flow, especially during periods of economic weakness. Rapidly growing supply in China and other developing economies, which may increase faster than increases in demand in those economies, may result in additional excess worldwide capacity and falling steel prices. Increased imports of steel products into North America and Europe could negatively affect steel prices and demand levels and reduce our profitability. Increases in prices and limited availability of raw materials and energy may constrain operating levels and reduce profit margins. Environmental compliance and remediation could result in substantially increased capital requirements and operating costs. Risk Factors Concerning U. S. Steel Legacy Obligations Our retiree employee health care and retiree life insurance plan costs, most of which are unfunded obligations, and our pension plan costs in North America are higher than those of many of our competitors. These plans create a competitive disadvantage and negatively affect our profitability and cash flow. We have higher environmental remediation costs than our competitors. This creates a competitive disadvantage and negatively affects our profitability and cash flow. Other Risk Factors Applicable to U. S. Steel Unplanned equipment outages and other unforeseen disruptions may reduce our results of operations. We may be unable to recover cost increases as we supply customers with steel under long-term fixed price sales contracts. Declines in the production levels of our major customers and customer payment defaults could have an adverse effect on our financial position, results of operations and cash flow. The terms of our indebtedness contain provisions that may limit our flexibility. Rating agencies may downgrade our credit ratings, which would make it more difficult for us to raise capital and would increase our financial costs. Change in control clauses in our financial and labor agreements grant the other party rights to accelerate obligations and to terminate or extend our labor agreements, Our operations expose us to uncertainties and risks in the countries in which we operate, which could negatively affect our results of operations and cash flow. We are subject to significant foreign currency risks, which could negatively impact our profitability and cash flows. Greenhouse gas policies could negatively affect our results of operations and cash flows. Our business requires substantial expenditures for debt service, contingent obligations, capital investment, operating leases and maintenance that we may be unable to fund. U. S. Steel is exposed to uninsured losses. Our collective bargaining agreements may limit our flexibility. There are risks associated with past acquisitions, as well as any acquisitions we may make in the future. We may be subject to litigation, the disposition of which could negatively affect our profitability and cash flow in a particular period. Provisions of Delaware Law, our governing documents and our rights plan may make a takeover of U. S. Steel more difficult. We may suffer employment losses, which could negatively affect our future performance. We may experience difficulties implementing our enterprise resource planning (ERP) system.

Full 10-K form ▸

1163302--2/24/2009--UNITED_STATES_STEEL_CORP