AK Steel Holding (AKS)

Steelmaker Completes Year of Recovery

MIDDLETOWN, OH, January 25, 2005 – AK Steel (NYSE: AKS) today reported that its adjusted 2004 fourth quarter pre-tax income was $73.7 million, equal to $0.68 per share of common stock, compared to an adjusted pre-tax loss of $65.3 million, or $0.60 per common share, for the fourth quarter of 2003. The adjusted pre-tax income for the 2004 fourth quarter excludes a $330.8 million pre-tax, non-cash benefit plan corridor charge, and a $5.4 million charge associated with the early retirement of debt. The adjusted pre-tax loss for the 2003 fourth quarter excludes a $240.1 million non-cash corridor charge.

Including the corridor charge and the early debt retirement charge, the company’s fourth quarter 2004 results were a net loss of $102.8 million, or $0.95 per share, compared to a net loss, including the applicable corridor charge, of $163.9 million, or $1.51 per share, in the fourth quarter of 2003.

The corridor adjustments reflect actuarial losses, outside a defined corridor, stemming from the company’s pension and other postretirement benefit plans, and are required by the company’s unique benefit accounting method. The company said the fourth quarter 2004 charge was primarily due to the impact of declining discount rates and higher health care cost trends.

Net sales for the fourth quarter of 2004 totaled a company record of $1,433.8 million on record shipments of 1,631,400 tons, compared to net sales of $1,054.0 million on shipments of 1,563,700 tons in the year-ago fourth quarter. The company said that its average steel selling price for the fourth quarter of 2004 was a record $878 per ton, 1% higher than the $866 per ton average for the third quarter of 2004, and a 31% increase in average selling price from the fourth quarter of 2003.

Excluding the corridor charge, AK Steel said its adjusted fourth quarter 2004 operating profit was $98.7 million, equal to $61 per ton. By comparison, the company’s adjusted fourth quarter 2003 operating loss, excluding the applicable corridor charge, was $28.4 million, equal to $18 per ton. Including the applicable corridor charges, AK Steel reported an operating loss of $232.1 million in the 2004 fourth quarter, compared to an operating loss of $268.5 million in the fourth quarter of 2003.

AK Steel said continued strong global demand for its steel products resulted in increased shipment volumes and higher spot market selling prices. In addition to higher spot market prices, the company said its average selling price also reflected the benefits of higher steel surcharges for raw materials and energy, which partially offset unprecedented high prices for raw materials and natural gas.