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Straightline Posts Three Months of Sales Growth; U. S. Steel's Technology-Enabled Distribution Company Continues Growth Trend


United States Steel Corporation (NYSE: X) stated today that its technology-enabled steel distribution division, Straightline Source, has recorded three consecutive months of sales growth despite continued weak domestic steel markets.

Concurrent with the launch of the StraightEdgeâ„¢ suite of supply chain management tools in the third quarter of 2002, Straightline increased its focus on contract business. Since the fourth quarter of 2002, Straightline's contract business sales have grown by 25 percent, a major contributor to its improving sales performance.

"Straightline has made progress in a difficult market," said U. S. Steel Chairman and CEO Thomas J. Usher. "Straightline's recent sales growth reflects continued customer confidence in its approach to steel distribution. Further growth is important to achieving our goal of profitability in the near term."

Launched in the fourth quarter of 2001, Straightline achieved revenues of $73 million in 2002, placing it 60th in Purchasing magazine's May 2003 listing of the Top 100 North American metals service centers.

Straightline President Bob Dryburgh attributes the current progress to the realization of the strategic shift initiated last year that increased emphasis on contractual relationships. "As customers rely more and more on their suppliers to collaborate in improving efficiencies and achieving cost reductions, they find value in the supply chain services offered by Straightline," Dryburgh stated. "Our business model enables us to determine the most efficient supply chain and to manage that supply chain effectively, using our information systems. This is beneficial for both customers and producers."

The Director of Outsourcing for a global telecommunications equipment manufacturer and Straightline customer states, "Together we've turned a management intensive purchasing process into a simple transparent system with a 50 percent reduction in inventory levels."

Although Straightline has always offered instant price quotes and the ability to make spot purchases, Straightline's contractual procurement services were introduced last October with the launch of StraightEdge, a suite of strategic inventory management tools that provide real-time information access and transactional applications. StraightEdge helps customers lower their overall cost of materials procurement by enabling a just-in-time operating environment. According to Straightline customer and Manager of Production and Inventory Control for a leading manufacturer of generator systems, "With Straightline, I don't have to worry about steel. With their StraightEdge tools, we've improved our inventory turns by 15 percent, which is a major cost savings for our company. Faster inventory turns allow us to use less space and reduce costs, which in turn improves profitability."

In addition to helping customers reduce their total cost of procurement through inventory management solutions, Straightline's technology also enables the company to meet everyday customer needs. According to a procurement executive for a large office furniture manufacturer, "For more than a year, Straightline's consistent performance has earned them a place as one of our primary steel suppliers. Since we started working with Straightline in August 2002, Straightline has surpassed our goal of 99 percent on-time delivery - no small feat considering we receive multiple items and trucks from Straightline each day."

Straightline is the first steel distribution business created to serve customers through a network of processing, supply and logistics partners, all linked together on a single technology platform. Straightline currently serves the eastern and central United States, reaching nearly 80 percent of the domestic steel-buying market. Straightline is a quality certified company, achieving QS 9000:1998 and ISO 9002:1994 certification.

To learn more about Straightline, visit

Statements in this release regarding profitability are forward-looking statements. Some factors, among others, that could affect profitability include future product demand, volumes, prices and mix, and U.S. economic performance. In accordance with "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, cautionary statements identifying important factors, but not necessarily all factors, that could cause actual results to differ materially from those set forth in the forward-looking statements have been included in the Form 10-K of U. S. Steel for the year ended December 31, 2002, and in subsequent filings for U. S. Steel.

SOURCE: United States Steel Corporation

CONTACT: John Armstrong or Mike Dixon of United States Steel,

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