U.S. Steel president and CEO Mario Longhi told analysts today the Pittsburgh steel producer should do better in the second half of the year after slumping prices and shipments and one-time charges produced a second quarter loss of $261 million, or $1.79 per share.

During a morning conference call, Mr. Longhi said much of his optimism is based on $590 million in cost savings the company expects to realize this year from the company’s Carnegie Way initiative. Those projected savings are $250 million higher than what the company expected at the end of the first quarter. He said the company also expects to generate additional, but temporary, savings of $175 million in the second half from short-term cost cuts that are separate from the permanent benefits provided by the Carnegie Way.

“We are attacking every aspect of our cost structure,” Mr. Longhi said.

Sales fell 34 percent during the quarter to $2.9 billion while steel shipments fell 23 percent to 3.9 million tons. Prices of flat roll steel produced at the company’s U.S. mills dropped 10 percent. Those mills operated at 58 percent of capacity during the quarter.

In the year-ago quarter, U.S. Steel reported a loss of $18 million, or 12 cents per share, on sales of $4.4 billion.

Results for the current quarter included a non-cash charge of $136 million, or 93 cents per share, for writing down the value of U.S. Steel’s remaining interest in its bankrupt Canadian operations, as well as a non-cash charge of $10 million, or 7 cents per share, for restructuring and other items. They also reflect a $186 million tax benefit related to its iron ore operations.

Excluding the two non-cash charges, U.S. Steel said its adjusted loss for the quarter was $115 million, or 79 cents per share.

Analysts had forecast an adjusted loss of 68 cents per share on sales of $2.97 billion.

In early trading today, U.S. Steel shares were up $1.55 to $19.28. They are off 28 percent for the year.