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ArcelorMittal’s most recent quarterly results

Results


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ArcelorMittal reports results for the first quarter 2016 View analysts slides in a new window View English version, PDF, opens in a new window View French version, PDF, opens in a new window Download spreadsheet View HTML version
Luxembourg, May 6, 2016 - ArcelorMittal (referred to as “ArcelorMittal” or the “Company”) (MT (New York, Amsterdam, Paris, Luxembourg), MTS (Madrid)), the world’s leading integrated steel and mining company, today announced results[1] for the three month period ended March 31, 2016.


Highlights:

  • Health and safety: LTIF rate of 0.72x in 1Q 2016, lower as compared to 0.83x in 4Q 2015 and 0.88x in 1Q 2015
  • EBITDA of $0.9 billion in 1Q 2016; 15.9% lower as compared to 4Q 2015 primarily reflecting the lagged effect of weak steel pricing, offset in part by higher steel shipments
  • Net loss of $0.4 billion in 1Q 2016 as compared to net loss of $6.7 billion in 4Q 2015. Excluding exceptional and non-cash items[2], adjusted net loss was $0.2 billion in 1Q 2016 as compared to adjusted net loss of $0.4 billion in 4Q 2015
  • Steel shipments of 21.5 Mt in 1Q 2016, an increase of 8.8% compared to 4Q 2015, and stable as compared 1Q 2015
  • 1Q 2016 iron ore shipments of 13.1 Mt (-2.2% YoY), of which 7.8 Mt shipped at market prices (-16.8% YoY, reflecting revised focus on more cost-competitive operations)
  • 1Q 2016 iron ore production of 14.1 Mt (-9.1% YoY); AMMC production of 6Mt (+7.2% YoY) and on track for FY’16 iron ore shipped at market prices >26Mt
  • Net debt higher at $17.3 billion as of March 31, 2016, as compared to $15.7 billion as of December 31, 2015, due largely to seasonal working capital investment ($1.2 billion) and forex ($0.5 billion). Giving effect to the sale of ArcelorMittal’s stake in Gestamp[3], and the proceeds from the successful rights issue, pro-forma net debt as of March 31, 2016 was $13.3 billion[4]

Strategic update:

  • Rights issue complete: On April 8, 2016, ArcelorMittal closed its rights issue raising €2.8 billion[5] ($3.2 billion)
  • Calvert: Ramp up progressing well with automotive certifications ongoing and increased capacity utilization; slab yard expansion of Bay 4 and minor installations for Bay 5 complete
  • Action 2020 plan underway: In the US we are moving forward with plans to streamline and optimize our US operations, building on the core strengths of each facility. In Europe we are progressing with the Transformation plan, and having established the Cluster Leading Plants we are in the process of moving processes and resources away from the satellite finishing sites. At the 2016 AGM, shareholders approved a new long-term incentive plan tied to the achievement of Action 2020 improvement targets  
  • Portfolio Optimization: The Company agreed to the sale of its LaPlace and Vinton Long Carbon facilities in the US during 1Q 2016; partial closure of Zumarraga (Spain)

Outlook and guidance:

  • The Company expects FY 2016 EBITDA to be in excess of $4.5 billion
  • The impact of the improving steel spread environment is expected to be fully reflected in the results of the second half of the year
  • Improving market conditions are likely to consume working capital in 2016 (current estimate of ~$0.5 billion); the Company nevertheless, expects to be free cash flow positive in 2016

Financial highlights (on the basis of IFRS[1]):

(USDm) unless otherwise shown 1Q 16 4Q 15 3Q 15 2Q 15 1Q 15
Sales 13,399 13,981 15,589 16,890 17,118
EBITDA 927 1,103 1,351 1,399 1,378
Operating income /(loss) 275 (5,331) 20 579 571
Net (loss)/ income attributable to equity holders of the parent (416) (6,686) (711) 179 (728)
Basic (loss)/ earnings per share (US$) (0.23) (3.72) (0.40) 0.10 (0.41)
Own iron ore production (Mt) 14.1 15.5 15.4 16.4 15.6
Iron ore shipped at market price (Mt) 7.8 9.9 10.3 10.8 9.4
Crude steel production (Mt) 23.2 21.6 23.1 24.0 23.7
Steel shipments (Mt) 21.5 19.7 21.1 22.2 21.6
EBITDA/tonne (US$/t) 43 56 64 63 64
Steel-only EBITDA/tonne (US$/t) 39 51 57 58 59

Commenting, Mr. Lakshmi N. Mittal, ArcelorMittal chairman and CEO, said:

“Our results for the first quarter reflect the very tough operating conditions in the second half of 2015. Since that time we have seen a recovery in spreads in our core markets to more sustainable levels, which is expected to result in improved results in the coming quarters. This is a welcome development, although given the levels of excess capacity in China the market remains fragile and we must continue to be vigilant and active against the threat of unfair trade.

Following the successful completion of the $3.2 billion rights issue, the Company has a sector-leading balance sheet.  Our priority now is to improve the structural earnings capability of the group through our five year strategic plan, Action 2020, which will drive significant improvements in both EBITDA and cash-flow over the longer-term.”


[1]The financial information in this press release has been prepared consistently with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). The interim financial information included in this announcement has been also prepared in accordance with IFRS applicable to interim periods, however this announcement does not contain sufficient information to constitute an interim financial report as defined in International Accounting Standards 34, “Interim Financial Reporting”. The numbers in this press release have not been audited. The financial information and certain other information presented in a number of tables in this press release have been rounded to the nearest whole number or the nearest decimal. Therefore, the sum of the numbers in a column may not conform exactly to the total figure given for that column. In addition, certain percentages presented in the tables in this press release reflect calculations based upon the underlying information prior to rounding and, accordingly, may not conform exactly to the percentages that would be derived if the relevant calculations were based upon the rounded numbers. This press release also includes certain non-GAAP financial measures.
[2]See appendix 5: Reconciliation of net loss to adjusted net (loss)/ income for details of exceptional items and impairments.
[3]On February 5, 2016 ArcelorMittal announced it had sold its 35% stake in Gestamp Automoción ("Gestamp") to the majority shareholder, the Riberas family, for a total cash consideration of €875 million. The transaction is unconditional and payment is expected to be made to ArcelorMittal within six months. In addition to the cash consideration, ArcelorMittal is expected to receive in 2Q 2016 a payment of $11 million as a 2015 dividend. ArcelorMittal will continue its supply relationship with Gestamp through its 35% shareholding in Gonvarri, a sister company of Gestamp. ArcelorMittal sells coils to Gonvarri for processing before they pass to Gestamp and other customers. Further, ArcelorMittal will continue to have a board presence in Gestamp, collaborate in automotive R&D and remain its major steel supplier.
[4]Includes proceeds from Gestamp sale $1.0 billion; Rights issue $3.2 billion and premium paid on early repayment of debt subsequent to rights issue of $0.1 billion.
[5]Based on exchange rate (€/$ 1.1250).

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