U.S. Steel reported a big increase in quarterly profit with high steel prices and strong demand.

The company reported first quarter 2005 net income of $455 million, or $3.48 per diluted share, compared to fourth quarter 2004 net income of $468 million, or $3.59 per diluted share, and first quarter 2004 net income of $58 million, or 47 cents per diluted share.

President and CEO John P. Surma said, “We had another excellent quarter as our plants and our people performed well. First quarter results reflected a dramatic improvement over the same period last year as our European and Tubular segments posted record income, and our balanced North American raw materials position bolstered our domestic performance. We continued to generate substantial cash and in March we further strengthened our balance sheet with an additional voluntary contribution of $130 million to our main domestic defined benefit pension plan.”

The company reported first quarter 2005 income from operations of $640 million, compared with income from operations of $547 million in the fourth quarter of 2004 and $151 million in the first quarter of 2004.

According to a press release, first quarter 2005 results included a pre-tax gain of $95 million from the previously disclosed settlement agreement relating to property tax disputes in Gary, Indiana. This favorable effect and other items not allocated to segments increased first quarter 2005 net income by $58 million, or 45 cents per diluted share. Certain income tax benefits totaling $30 million and other items not allocated to segments increased net income in fourth quarter 2004 by $14 million, or 10 cents per diluted share. An income tax charge related to settlement of a dispute regarding tax benefits for U. S. Steel Kosice (USSK) and other items not allocated to segments reduced first quarter 2004 net income by $10 million, or eight cents per diluted share.

Chris is a staff writer for Murdok. Visit Murdok for the latest ebusiness news.