THREE WAYS THIS MATTERS TO YOU
1. TOP EMPLOYER: AK Steel is the City of Middletown's largest employer, but it's also the third largest employer overall in Butler County behind Miami University and Cincinnati Financial Corp.
Approximately 2,400 people work full-time at the West Chester Twp. headquarters office, steel plant Middletown Works and the Middletown research center.
Therefore, the fortunes of the local economy are closely tied to the company’s success.
2. MAJOR STOCK: AK Steel's Fortune 500 status makes it one of the largest publicly-traded companies in the Cincinnati-Dayton region where not only is its stock widely held, but where it also contributes to the region's out-of-state name recognition.
After acquiring its eighth steel plant in 2014, boosting sales, AK Steel ascended the ranks of the annual Fortune 500 list this year to land in the 415th spot of largest companies by total revenues.
AK Steel revenues grew in 2014 to $6.51 billion, a 17 percent rise from $5.57 billion in 2013, according to the company. After costs of doing business, taxes and other expenses and gains, AK Steel had a net loss last year of $96.9 million.
3. LOCAL ECONOMY: AK Steel's history in Middletown dates back over 100 years and not only does the steelmaker employ thousands in Butler County on its payroll, it depends on more suppliers and contractors from throughout the region to run its business.
“People feel their pain as well… when times are hard,” said Rick Pearce, president and chief executive officer of The Chamber of Commerce Serving Middletown, Monroe and Trenton. “They kind of set the business tone.”
WHO IS ROGER NEWPORT?
Included in the announcement that Wainscott is retiring was the appointment of his successor in the chief executive officer position. Roger Newport is slated to become the next CEO of the steel manufacturer in January when Wainscott retires.
Here’s what we know about Newport:
- Newport has actually worked at AK Steel longer than Wainscott; Newport started his career with the company in 1985 in the accounting department. He rose through increasingly responsible finance, sales and marketing roles at the corporate headquarters and the company's Middletown Works steel plant.
- Like his predecessor, Newport has served as chief financial officer before being promoted to the CEO role. Newport was named controller in 2001; chief accounting officer in 2004; vice president, business planning and development in 2010; vice president, finance and chief financial officer in 2012; senior vice president, finance and chief financial officer in 2014; and executive vice president, finance and chief financial officer this year.
- Newport also serves on several local boards such as the Cincinnati USA Regional Chamber of Commerce; and the Dean's Executive Advisory Board for Xavier University's Williams College of Business. He previously served as group chair, special projects for the 2014 United Way of Greater Cincinnati Campaign. Newport is a graduate of University of Cincinnati and Xavier University.
- The role of CEO and president is being split. While Wainscott held both titles, Kirk Reich has been named the next president.
SOURCE: AK Steel
MORE ONLINE
AK Steel provided Oct. 30 a statement from Chairman, President and Chief Executive Officer James Wainscott reflecting on his tenure as he approaches retirement as president and CEO. Wainscott will still be chairman after the transition. Read the full statement online only at www.journal-news.com.
For too much of the AK Steel chief executive officer’s tenure, it’s been a challenging environment, quipped one analyst last week on the day James Wainscott’s intentions to retire were announced.
After 20 years spent at AK Steel, first joining the company as treasurer and rising the ranks to chairman, president and CEO, Wainscott's plans to retire in Jan. 2016 were revealed Tuesday.
During the last 12 years at the helm of the Butler County steelmaker, Wainscott led a recovery riding a housing and construction boom to record sales, before The Great Recession of 2007 to 2009 saw demand for automobiles and new buildings made with steel plummet.
Now on the eve of plans to step down from the day-to-day wheel, AK Steel is feeling the heat of a new crisis: foreign competition importing steel products to the United States market, sometimes using what AK Steel calls illegal trade practices.
AK Steel has survived a number of massive changes to the steel business over the years, Wainscott told the Journal-News in 2013 in written responses, when marking his 10 year anniversary as CEO. Over the past decade, AK Steel has become more of a customer-centric organization committed to industry-leading quality, delivery and service standards. As the only company in North America to make all three steel grades — carbon, stainless and electrical — AK Steel has also learned to produce more with less; and shifted its research focus to innovation and new product development, Wainscott said at the time.
“It is necessary to do all of these things in order to compete effectively — and to win — in the global steel marketplace of the future,” he said in 2013.
An interview request with Wainscott and successor Roger Newport, who was named to take over next year as CEO, was declined last week. He did provide a statement. And during a conference call with investor analysts Oct. 27, Wainscott said AK Steel keeps fighting new challenges because we “want to be here tomorrow, next year and 10 years from now to serve our customers.”
In fact, one message Wainscott has repeated over and over in recent years in public remarks is the importance of American manufacturing and steelmaking.
“We need to make things in America, including steel that goes into so many other products. Manufacturing is the backbone of our economy,” he says.
When Wainscott went before Middletown City Council this year for plans to build a new $36 million Research and Innovation center in city limits, he told this newspaper in an interview about the importance of the company's vital long-term investments such as new product development of advanced, high-strength steels.
“The great challenge I think in leading a company, any company, but particularly a steel company, is kind of balancing the here and now, the challenge of the here and now, while you’re still setting the stage for the future,” he said during the May interview.
“We have to be thinking about tomorrow and the long-term and positioning our company for long-term success and that starts with really serving customers well,” he said.
“We make great steel. We make a lot of it very safely. We make great quality and delivery,” he said. “But we have to make what customers want, and we have to be right on the cutting edge.”
AK Steel’s history in Middletown dates back over 100 years to when its predecessor the American Rolling Mill Co. was founded on the banks of the Great Miami River. The company’s relationship with the steel town was tested several times under Wainscott’s leadership, including a year-long lockout that began in 2006 during union contract negotiations, and again in 2007 when it was announced the headquarters would move from Middletown to West Chester Twp.
“Initially, I thought James was a good fit for the company to step up and be able to lead, and unfortunately, I just believe his leadership really, it put our community in a stressful situation even to a point of oppression,” said Rev. Michael Bailey of Faith United Church and an AK Steel retiree. Bailey was one of the plaintiffs in a lawsuit against the company regarding retiree benefits that was settled. “I say that from the view of what was done in Mansfield, Ohio, and what happened to Mansfield after the lockout and the almost one-year lockout in Middletown (that) almost devastated our communities.”
The retirees’ health care benefits are now secure, Bailey said. With the issue now in the past, Bailey congratulated Wainscott for moving forward.
“The unfortunate side is those individuals who stood on the line for us, their health care situations are not as rewarding as ours, and they sacrificed a whole lot,” Bailey said. “He did not respect the workers as an asset. He looked on to them as a liability to the bottom line for AK.”
“Middletown is still trying to recover, and hopefully under new leadership, we can get there,” he said.
While Wainscott was not available last week for an interview, the company provided Friday a statement from Wainscott.
“The focus of my tenure leading AK Steel was to fix the company while enhancing value for the owners of the company, our shareholders. I am most proud of the fact that we honored our obligations, especially our retiree obligations,” Wainscott’s statement reads. “We rebuilt a steel company without forgetting who built it in the first place — our retirees — and we did not use our retirees and their legacy costs (i.e., getting rid of them) as currency for our turnaround.”
Larry Mulligan Jr. may now be Middletown mayor, but he still remembers his first meeting with Wainscott in 2004 or 2005 when considering a first-run for council. At the time, Mulligan was participating in a finance committee for a proposed income tax levy and he asked fellow committee member and now-retired AK Steel vice president Alan McCoy for a meeting with the CEO to gauge Wainscott’s thoughts on Mulligan’s council bid.
“He was open and committed to Middletown. It was in the old general office,” Mulligan said. “It was good to understand his perspective what he was looking at, at AK in Middletown at that time.”
Mulligan didn’t end up running that race. But he also remembers after joining council later on, when another mayor at the time got the call headquarters was moving.
“It was eye opening I think. I think we need to pay close attention to all of our employers, not just the biggest, but I think the city had kind of fallen short in that regard just due to a variety of reasons,” Mulligan said.
“We were probably five years behind in terms of what their needs were. They were looking for highway access. They wanted some of the amenities, quality of life stuff and unfortunately, we were flatfooted,” he said. Since then, “I’d say we stepped up our game a little bit.”
The West Chester-Liberty Chamber Alliance named Wainscott one of its inaugural Everest Award honorees in 2012. The program recognizes business leaders along the Interstate 75 corridor.
“He was surely somebody we felt compelled to honor… because when he became the CEO of AK Steel he was widely regarded in the industry as the person who refocused AK Steel on the resurgence in the steel business,” said Joe Hinson, chamber president and chief executive officer.
“When AK Steel came here, that’s a Fortune 500, that was a big thing for West Chester Twp.,” Hinson said. “When other businesses look at the area and they’re looking to see who the business neighbors are, what the business climate is, they’re going to look at who else is there.”
After January, Wainscott continues in the role of AK Steel’s board chairman. Before joining AK Steel, Wainscott held top management-level positions at National Steel Corp. He is a former chairman of the American Iron and Steel Institute, past chair of the Steel Market Development Institute and recipient of AISI’s highest honor, the Gary Memorial Medal, for life-long contributions to the North American steel industry, according to AK Steel.
Wainscott has been selected to receive the 2016 Lifetime Achievement Award from the Association for Corporate Growth in Cincinnati, according to the company.
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