Key figures for 4Q 2020

2020 Key Highlights:

  • Health and safety performance: Protecting the health and wellbeing of employees remains the Company’s overarching priority; LTIF rate of 0.61x in 2020 vs. 0.75x in FY 20192
  • Despite the challenging market environment that saw steel shipments decline in 2020 by 18.2% and a net loss of $0.7bn, the Company delivered $1.5bn of free cash flow (“FCF”, net cash provided by operating activities of $4.1bn less capex of $2.4bn less dividends paid to minorities of $0.2bn)
  • FY 2020 operating income of $2.1bn4,5 $0.6bn operating loss4,5 in FY 2019. FY 2020 EBITDA of $4.3bn with 4Q'20 EBITDA of $1.7bn (almost double 4Q'19 level) reflecting recovering fundamentals and providing good momentum into 2021; 4Q 2020 adjusted net income18 of $0.2bn vs. adjusted net loss of $0.2bn in 3Q 2020
  • The Company ended 2020 with gross debt of $12.3 billion and net debt of $6.4 billion, the lowest level since the 2006 merger, allowing the Company to transition to a new capital allocation policy prioritizing returns to shareholders
  • Repositioned its North American footprint through the completed sale of ArcelorMittal USA to Cleveland Cliffs, unlocking value and significantly reducing liabilities
  • Reinforced its European footprint through the agreed investment by the Italian government in ArcelorMittal Italia (expected to be deconsolidated in 1Q 2021)
  • ArcelorMittal sold its first certified green steel products9 to customers in December 2020, reflecting its leadership position in technology and innovation and commitments to decarbonize

Priorities & Outlook:

  • Global climate change leadership: Whilst policy support remains crucial to the development of decarbonization in the steel industry, the Company is focused on progressing towards its 2050 net zero group carbon emissions target. A range of innovative technology options are advancing, including the Group’s first Smart Carbon projects (Carbalyst) to start production in Ghent, Belgium (in 2022) and first Hydrogen reduction project in Hamburg to start production (estimated 2023-2025)
  • Cost advantage - New $1.0bn fixed cost reduction program in progress to ensure that a significant portion of fixed cost savings achieved during the COVID-19 crisis is sustained; expected completion by the end of 2022 (savings from a FY 2019 base)
  • Strategic growth: The Company is focused on organic growth, cost improvement, product portfolio and margin enhancing projects in emerging growth markets, including: Mexico HSM project (completion expected in 2021); Brazil cold rolling mill complex project (recommenced, with startup targeted 2023); and Liberia phase II expansion (first concentrate targeted in 4Q 2023)
  • Consistent returns to shareholders: The Company initiated its capital return to shareholders with a $500m share buyback10 in 2H 2020 following the announced agreement to sell ArcelorMittal USA to Cleveland Cliffs. This process continues with a further $650m to be returned via a share buyback19 following the partial sell-down of the Company’s equity stake in Cleveland Cliffs announced on February 9, 2021. In addition, and in accordance with the new capital return policy, the Board proposes to restart the base dividend to shareholders at $0.30/sh (to be paid in June 2021, subject to the approval of shareholders at the AGM in May 2021), and return $570m of capital to shareholders through a further share buyback program in 2021
  • Recovery in steel shipments: Recovery in apparent steel demand (growth of +4.5% to +5.5% is currently forecast in 2021 vs. 2020); steel shipments are expected to increase YoY (on a scope adjusted basis i.e. excluding the impacts of the ArcelorMittal USA sale and the deconsolidation of ArcelorMittal Italia12 (expected in 1Q 2021))

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

“2020 was a year of enormous challenge as countries, societies and businesses across the world grappled with the disruption caused by the COVID-19 pandemic. The impact on the steel industry was significant, but I am very proud of the resilience and enterprise shown across the business which enabled ArcelorMittal to deliver a solid operating performance in times of adversity" Mr. Lakshmi N. Mittal, ArcelorMittal Executive Chairman