Bethlehem Steel Corporation - Needing Nerves of the Same

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Long-term Debt Ratio 50.8% 36.6% 30.6%

Debt-Equity Ratio 88.1% 80.0% 78.3%

Cash Flow from Operations/Total Liabilities 4.1% 7.8% 12.9

Times Interest Charges Earned 1.0 3.4 5.1

aExcludes restructuring charge in Year 23.

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Exhibit 1

Bethlehem Steel Income Statements

(amounts in millions)

For the year ended

December 31:

Year 19

Year 20

Year 21

Year 22

Year 23

Year 24

Year 25

Sales $ 5,250.9 $ 4,899.2 $ 4,317.9 $ 4,007.9 $ 4,323.4 $ 4,819.4 $ 4,867.5

Cost of Goods Sold (4,724.4) (4,632.9) (4,301.1) (4,051.6) (4,111.7) (4,548.4) (4,486.8)

Selling and

Administrative (154.1) (159.6) (171.0) (159.3) (156.9) (137.4) (111.8)

Estimated Restructuring

Lossesa (105.0) (550.0) (575.0) -- (350.0) -- --

Income (Loss) from

Operations $ 267.4 $ (443.3) $ (729.2) $ (203.0) $ (295.2) $ 133.6 $ 268.9

Interest Expense (Net) (9.7) (14.2) (35.8) (52.3) (56.1) (39.1) (52.3)

Income (Loss) Before

Taxes $ 257.7 $ (457.5) $ (765.0) $ (255.3) $ (351.3) $ 94.5 $ 216.6

Profit for Income Taxes (12.0) (6.0) (2.0) 45.0 85.0 (14.0) (37.0)

Net Income (Loss) $ 245.7 $ (463.5) $ (767.0) $ (210.3) $ (266.3) $ 80.5 $ 179.6

aRestructuring charges relate to the following:

Year 19: Employee terminations from reduced levels of operating activity.

Year 20: Restructuring of structural steel and rail products segments.

Year 21: Exiting the bar, rod, and wire business.

Year 23: Exiting the heavy structural steel business.

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Exhibit 2

Bethlehem Steel Balance Sheets

(amounts in millions)

DeceDecember 31:

Year 18

Year 19

Year 20

Year 21

Year 22

Year 23

Year 24

Year 25

Cash $ 507.4 $ 530.5 $ 273.5 $ 83.8 $ 208.2 $ 228.9 $ 159.5 $ 180.0

Accounts

Receivable 555.1 484.2 451.1 413.7 403.3 503.2 519.5 374.6

Inventories 369.0 410.3 468.3 453.4 344.4 852.5 882.9 958.2

Other Current

Assets 8.3 10.2 10.3 6.9 5.5 6.5 7.2 13.0

Total Current

Assets $ 1,439.8 $ 1,435.2 $ 1,203.2 $ 957.8 $ 961.4 $ 1,591.1 $ 1,569.1 $ 1,525.8

Property, Plant

and Equipment 2,871.5 2,916.7 2,796.4 2,864.8 2,804.5 2,634.3 2,759.3 2,714.2

Other Assets 137.2 441.4 382.5 305.7 1,304.8 1,651.3 1,454.0 1,460.3

Total Assets $ 4,448.5 $ 4,793.3 $ 4,382.1 $ 4,128.3 $ 5,070.7 $ 5,876.7 $ 5,782.4 $ 5,700.3

Current

Liabilities $ 870.1 $ 838.0 $ 831.4 $ 931.0 $ 893.2 $ 914.2 $ 1,011.2 $ 1,049.6

Long-term Debt 774.5 655.5 589.8 761.6 726.8 718.3 668.4 546.8

Other Noncurrent

Liabilitiesa 1,013.1 1,296.9 1,471.9 1,760.9 3,071.6 3,547.6 2,947.0 2,865.6

Total

Liabilities $ 2,657.7 $ 2,790.4 $ 2,893.1 $ 3,453.5 $ 4,691.6 $ 5,180.1 $ 4,626.6 $ 4,462.0

Preferred Stock $ 329.7 $ 320.2 $ 9.1 $ 9.2 $ 9.4 $ 14.4 $ 14.2 $ 14.2

Common Stock 972.4 989.9 1,306.0 1,300.2 1,453.6 1,622.1 2,001.0 1,903.9

Retained Earnings

(Deficit) 488.7 692.8 173.9 (634.6) (1,083.9) (939.9) (859.4) (679.8)

Total Shareholders’

Equity $ 1,790.8 $ 2,002.9 $ 1,489.0 $ 674.8 $ 379.1 $ 696.6 $ 1,155.8 $ 1,238.3

Total Liabilities

And Shareholder’s

Equity $ 4,448.5 $ 4,793.3 $ 4,382.1 $ 4,128.3 $ 5,070.7 $ 5,876.7 $ 5,782.4 $ 5,700.3

aPrimarily includes obligations for pensions and, beginning in Year 22, retirement health care benefits.

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Exhibit 3

Bethlehem Steel Statement of Cash Flows

(amounts in millions)