Overcapacity cuts Q3 income of ArcelorMittal to USD1.2 billion

ArcelorMittal

The world’s largest steel company, ArcelorMittal said its operating for the third quarter of the year fell to USD1.2 billion compared to USD1.4 billion last year.

As an outlook, the company said market conditions are favourable. The demand environment remains positive (as evidenced by the continued high readings from the ArcelorMittal weighted PMI) and steel spreads remain healthy.

The Company continues to expect cash needs of the business (capex ($2.9 billion), interest ($0.8 billion), cash taxes, pensions and other cash costs (totalling $0.9 billion) but excluding working capital investment and premiums paid to retire debt early) to be approximately $4.6 billion in 2017.

Given the improved market conditions, the Company now expects the full year 2017 investment in working capital of approximately $2.0 billion (as compared to previous guidance of approximately $1.5 billion).

Commenting, Mr. Lakshmi N. Mittal, ArcelorMittal Chairman and CEO, said:
“Favorable market conditions have supported another solid quarterly performance, with EBITDA for the first nine months considerably improved year-on-year.  Operating conditions continue to improve, with key indicators including the ArcelorMittal weighted PMI implying a positive outlook for 2018.  While pleased with the progress that we are making, we operate in a competitive global environment which is characterized by overcapacity and high levels of imports.  The implementation of our strategic plan Action 2020 remains a clear priority and we are making good progress in this regard.”