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ACME STEEL COMPANY CEO SEES CONTINUED TOUGH ENVIRONMENT FOR INDUSTRY: SUSTAINED SECOND-HALF 1992 IMPROVEMENT FOR ACME

 ACME STEEL COMPANY CEO SEES CONTINUED TOUGH ENVIRONMENT FOR INDUSTRY:
 SUSTAINED SECOND-HALF 1992 IMPROVEMENT FOR ACME
 RIVERDALE, Ill., April 1 /PRNewswire/ -- Brian W.H. Marsden, president and chief executive officer of Acme Steel Company headquartered here, today said that despite enormous positive change within the U.S. steel industry and significant investment to improve its competitiveness, there was little prospect that domestic steel consumption would soon increase. "Improved profitability, if it is to come, must come from reducing costs and seeking out niche markets where each company is best equipped to compete," the Acme president noted. He also held out a ray of hope that the "new world order with freer trade and the prospects of a relatively weak U.S. dollar" might open additional attractive export opportunities for the industry.
 The steel executive made his comments in a wide-ranging interview included in the Acme Steel annual report now being mailed to company shareholders.
 Marsden said the outlook for Acme in 1992 was "certainly better than '91," when Acme's sales were off 15 percent, and the company lost 43 cents per share, compared with earnings of $1.05 per share in 1990.
 "Improvement in the first half of this year probably will be sluggish at best, but I believe we'll see a more sustained upturn in the second half of the year," said Marsden.
 "The industry faces a scenario that is not terribly rosy, but I believe Acme will do better because of the niches we have developed, the investments we've made, and the growing contributions from our forward integration.
 "Our smallness is proving a big advantage. It allows us to efficiently serve the needs of the 'small-order customer,' and it allows us to specialize in custom steels for customers with exact metallurgical and tolerance requirements. Our more than 400 steel grades are far more than most competitors can offer. And our narrow rolling mill produces strip and sheet steels ideal for uses where close dimensional tolerances are critical," he explained.
 "As a result, although Acme is a small player in an industry of giants, we hold nearly 40 percent of the market for high-quality narrow hot-rolled strip steel produced in the United States," said Marsden.
 Marsden told shareholders that while 1991 was disappointing financially, it was encouraging from an operational and strategic perspective. "Our strategy of modernization and downstream integration saved us from an even worse fate in 1991.
 "Because of our on-going modernization, virtually every major production unit within the company achieved record productivity, quality, safety, and unit-cost performance marks in 1991, and we should continue to benefit from this investment," said Marsden.
 Attesting to its strategic diversification, for the first time in its history, Acme sales of strapping and related products exceeded those of commercial steels. Strapping sales accounted for 38 percent of the total, while commercial steel sales were 37 percent of 1991 sales. Pipe and tube products represented 16 percent and automotive jacks accounted for the remaining 9 percent of Acme's 1991 sales of $377 million.
 "Our downstream operations, although affected by the recession, accounted for more than 45 percent of our steel output for the year. That represented not only locked-in business, but also an opportunity to sell more of our steel products in higher value-added markets," he noted.
 "In addition to cushioning the downturn, I believe our strategy will magnify the impact of an upturn for Acme Steel," concluded Marsden.
 -0- 4/1/92
 /CONTACT: Charles A. Nekvasil of Acme Steel Company, 708-849-2500
 (ACME) CO: Acme Steel Company ST: Illinois IN: MNG SU: ECO


TS -- NY059 -- 3892 04/01/92 13:06 EST
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Publication:PR Newswire
Date:Apr 1, 1992
Words:600
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