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 and six-month periods ended June 30, 2018.

  • Analysts slides – EN – PDF
  • Press release – EN – FR – PDF
  • Analysts Webcast – English
  • Q&A – EN – PDF

Highlights:

  • Health and safety: LTIF rate of 0.71x in 2Q 2018; 1H 2018 LTIF of 0.67x vs. 0.78x 1H 2017
  • Operating income of $2.4 billion in 2Q 2018; 1H 2018 operating income of $3.9 billion, 32.5% higher YoY
  • EBITDA of $3.1 billion in 2Q 2018, 22.3% higher vs. 1Q 2018; 1H 2018 EBITDA of $5.6 billion, 28.6% higher YoY
  • Net income of $1.9 billion in 2Q 2018, 56.4% higher vs. 1Q 2018; 1H 2018 net income of $3.1 billion, +31.5% YoY
  • Steel shipments of 21.8Mt in 2Q 2018, +1.8% vs. 1Q 2018; 1H 2018 steel shipments of 43.1Mt, up 1.3% YoY
  • 2Q 2018 iron ore shipments of 14.6Mt, of which 10.0Mt shipped at market prices (+5.4% YoY)
  • Gross debt of $13.5 billion as of June 30, 2018. Net debt decreased to $10.5 billion as of June 30, 2018, as compared to $11.1 billion as of March 31, 2018, despite further $1.2 billion working capital investment.

Strategic progress in 1H 2018:

Balance sheet:

  • ArcelorMittal has achieved its financial priority of an investment grade credit rating following upgrades from all 3 credit rating agencies in 2018 (S&P in February, Moody's in June and Fitch in July)
  • Deleveraging remains the Group's priority and, in the absence of further working capital investment, progress towards $6 billion net debt target should accelerate

Structural improvement:

  • The Group's strategy to drive structurally higher returns through the delivery of Action 2020 continues; we now operate from a more efficient, resized footprint in Europe utilising enhanced digitalization of operations to drive productivity improvements and support maintenance excellence
  • Strategic investments continue in line with the continuous shift towards higher added value products including increased ultra-high strength steel capabilities at Gent/Liege (commissioned); investing in high-return opportunities such as the ongoing Mexico hot strip mill project
  • Votorantim acquisition completed with integration underway to secure our position as the leading long product producer in Brazil; European Commission anti-trust approval received for the acquisition of Ilva

Industry leadership:

  • ArcelorMittal's pioneering new installation at Gent, Belgium, to apply LanzaTech carbon capture and utilisation technology to convert carbon-containing gas from blast furnaces into bioethanol reflecting our position as the industry leader as well as the supplier-awards received from Honda, General Motors and Ford during 1H 2018
  • The Group's ability to leverage its R&D capabilities is exemplified through the launch of Steligence®, ArcelorMittal's new concept for the use of steel in construction, which will facilitate the next generation of high performance buildings and construction techniques and create a more sustainable life-cycle for buildings

Shareholders returns:

  • ArcelorMittal resumed dividends in May 2018 and bought-back $0.2 billion of shares in March 2018
  • The Company is committed to increase shareholders returns once the Group's net debt target is achieved

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

(USDm) unless otherwise shown 2Q 18 1Q 18 2Q 17 1H 18 1H17
Sales 19,998 19,186 17,244 39,184 33,330
Operating income 2,361 1,569 1,390 3,930 2,966
Net income attributable to equity holders of the parent 1,865 1,192 1,322 3,057 2,324
Basic earnings per share (US$)[2] 1.84 1.17 1.30 3.01 2.28
           
Operating income/ tonne (US$/t) 109 73 65 91 70
EBITDA 3,073 2,512 2,112 5,585 4,343
EBITDA/ tonne (US$/t) 141 118 98 130 102
Steel-only EBITDA/ tonne (US$/t) 127 101 83 114 83
           
Crude steel production (Mt) 23.2 23.3 23.2 46.5 46.8
Steel shipments (Mt 21.8 21.3 21.5 43.1 42.5
Own iron ore production (Mt) 14.5 14.6 14.7 29.1 28.7
Iron ore shipped at market price (Mt) 10.0 9.1 9.5 19.1 18.1

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

"This is an encouraging set of results reflecting the structural improvements in both the global steel industry due to supply reform dynamics and within ArcelorMittal as a result of Action 2020. The significant improvement in our balance sheet and earnings outlook has been recognised by the main credit agencies and the Company has achieved its stated aim of regaining its investment grade credit rating.

The outlook for the second half of the year is encouraging as we anticipate current favourable market conditions continuing and are well positioned to capitalise on this from our leadership position across many key markets. We believe improvements in underlying industry fundamentals are sustainable, although there is still more to be done to thoroughly address the issue of global overcapacity. We will retain a deleveraging bias, whilst also pursuing selective opportunities to strengthen the foundations of sustainable value creation."

Second quarter 2018 earnings analyst conference call

ArcelorMittal management (including CEO and CFO) will host a conference call for members of the investment community to discuss the second quarter period ended June 30, 2018 on: Wednesday August 1, 2018 at 9.30am US Eastern time; 2.30pm London time and 3.30pm CET.

The dial in numbers are:

Location Toll free dial in numbers Local dial in numbers  Participant
UK local: 0800 0515 931 +44 (0)203 364 5807 72687242#
US local: 1 86 6719 2729 +1 24 0645 0345 72687242#
US (New York): 1 86 6719 2729 + 1 646 663 7901 72687242#
France: 0800 914780 +33 1 7071 2916 72687242#
Germany: 0800 965 6288 +49 692 7134 0801 72687242#
Spain: 90 099 4930 +34 911 143436 72687242#
Luxembourg: 800 26908 +352 27 86 05 07 72687242#

A replay of the conference call will be available for one week by dialing: +49 (0) 1805 2047 088; Access code 521733#

Forward-Looking Statements

This document may contain forward-looking information and statements about ArcelorMittal and its subsidiaries. These statements include financial projections and estimates and their underlying assumptions, statements regarding plans, objectives and expectations with respect to future operations, products and services, and statements regarding future performance. Forward-looking statements may be identified by the words "believe", "expect", "anticipate", "target" or similar expressions. Although ArcelorMittal's management believes that the expectations reflected in such forward-looking statements are reasonable, investors and holders of ArcelorMittal's securities are cautioned that forward-looking information and statements are subject to numerous risks and uncertainties, many of which are difficult to predict and generally beyond the control of ArcelorMittal, that could cause actual results and developments to differ materially and adversely from those expressed in, or implied or projected by, the forward-looking information and statements. These risks and uncertainties include those discussed or identified in the filings with the Luxembourg Stock Market Authority for the Financial Markets (Commission de Surveillance du Secteur Financier) and the United States Securities and Exchange Commission (the "SEC") made or to be made by ArcelorMittal, including ArcelorMittal's latest Annual Report on Form 20-F on file with the SEC. ArcelorMittal undertakes no obligation to publicly update its forward-looking statements, whether as a result of new information, future events, or otherwise.

 

[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") and as adopted by the European Union. 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 Standard 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. ArcelorMittal presents EBITDA, and EBITDA/tonne, which are non-GAAP financial measures and defined in the Condensed Consolidated Statement of Operations, as additional measurements to enhance the understanding of operating performance. ArcelorMittal believes such indicators are relevant to describe trends relating to cash generating activity and provides management and investors with additional information for comparison of the Company's operating results to the operating results of other companies. ArcelorMittal also presents net debt as an additional measurement to enhance the understanding of its financial position, changes to its capital structure and its credit assessment. ArcelorMittal also presents free cash flow, which is a non-GAAP financial measure defined in the Condensed Consolidated Statement of Cash flows, because it believes it is a useful supplemental measure for evaluating the strength of its cash generating capacity. Non-GAAP financial measures should be read in conjunction with, and not as an alternative for, ArcelorMittal's financial information prepared in accordance with IFRS. Such non-GAAP measures may not be comparable to similarly titled measures applied by other companies.

[2] At the Extraordinary General Meeting held on May 10, 2017, the shareholders approved a share consolidation based on a ratio 1:3, whereby every three shares were consolidated into one share (with a change in the number of shares outstanding and the accounting par value per share). The figures presented for the basic and diluted earnings per share reflect this change for 2Q 2017 and 1H 2017.

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About ArcelorMittal

ArcelorMittal is the world's leading steel and mining company, with a presence in 60 countries and primary steelmaking facilities in 18 countries. In 2019, ArcelorMittal had revenues of $70.6 billion and crude steel production of 89.8 million metric tonnes, while iron ore production reached 57.1 million metric tonnes. Our goal is to help build a better world with smarter steels. Steels made using innovative processes which use less energy, emit significantly less carbon and reduce costs. Steels that are cleaner, stronger and reusable. Steels for electric vehicles and renewable energy infrastructure that will support societies as they transform through this century. With steel at our core, our inventive people and an entrepreneurial culture at heart, we will support the world in making that change. This is what we believe it takes to be the steel company of the future. ArcelorMittal is listed on the stock exchanges of New York (MT), Amsterdam (MT), Paris (MT), Luxembourg (MT) and on the Spanish stock exchanges of Barcelona, Bilbao, Madrid and Valencia (MTS). For more information about ArcelorMittal please visit: http://corporate.arcelormittal.com/

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