ArcelorMittal reports results for the first quarter 2017

Results – ArcelorMittal 

Luxembourg, May 12, 2017 – 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, 2017.

  • Health and safety: LTIF rate of 0.80x in 1Q 2017 as compared to 0.84x in 4Q 2016 and 0.72x in 1Q 2016
  • Operating income increased to $1.6 billion in 1Q 2017 as compared to $0.8 billion in 4Q 2016
  • EBITDA of $2.2 billion in 1Q 2017, 34.3% higher as compared to $1.7 billion in 4Q 2016 primarily reflecting higher steel shipments (+5.1%) and higher seaborne iron ore prices (+21%)
  • Net income of $1.0 billion in 1Q 2017 as compared to $0.4 billion in 4Q 2016
  • Steel shipments of 21.1 Mt in 1Q 2017, up 5.1% vs. 4Q 2016 and down 1.9% vs. 1Q 2016 (down 0.9% on comparable basis[2])
  • 1Q 2017 iron ore shipments of 13.4 Mt (+1.7% YoY), of which 8.7 Mt shipped at market prices (+11.2% YoY)
  • Due to seasonal working capital investment ($2.2 billion), net debt increased to $12.1 billion as of March 31, 2017, as compared to $11.1 billion as of December 31, 2016

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

(USDm) unless otherwise shown 1Q 17 4Q 16 3Q 16 2Q 16 1Q 16
Sales 16,086 14,126 14,523 14,743 13,399
Operating income 1,576 809 1,204 1,873 275
Net income/(loss) attributable to equity holders of the parent 1,002 403 680 1,112 (416)
Basic earnings/(loss) per share (US$)[3] 0.33 0.13 0.22 0.38 (0.23)
Operating income/ tonne (US$/t) 75 40 59 85 13
EBITDA 2,231 1,661 1,897 1,770 927
EBITDA/ tonne (US$/t) 106 83 93 80 43
Steel-only EBITDA/ tonne (US$/t) 83 68 83 73 39
Crude steel production (Mt) 23.6 21.8 22.6 23.1 23.2
Steel shipments (Mt) 21.1 20.0 20.3 22.1 21.5
Own iron ore production (Mt) 14.0 13.9 13.7 13.5 14.1
Iron ore shipped at market price (Mt) 8.7 8.1 8.1 9.6 7.8

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

“ I am satisfied with the first quarter results, which reflect the anticipated positive momentum in the market and the progress we are making internally to make the business stronger. All parts of the business reported improved EBITDA as steel prices responded to higher raw material costs and strong volume growth saw steel shipments increase by 5.1% compared with the fourth quarter. Our mining segment benefitted from an increase in iron-ore shipped at market prices as well as the higher raw material price environment. Looking ahead, we expect market conditions to be broadly stable in the second quarter. While this is encouraging, the steel industry is still impacted by unfair imports in many of our key markets and we hope to see further progress in ensuring the necessary trade solutions”.

[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 appendix 8, 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 and the ratio of net debt to EBITDA as an additional measurement to enhance the understanding of its financial position, changes to its capital structure and its credit assessment. 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]On a comparable basis (considering the sale of long steel producing subsidiaries in the US (LaPlace and Vinton) in 2Q 2016 and Zaragoza in Spain during 3Q 2016), total steel shipments for 1Q 2017 of 21.1Mt was 0.9% lower as compared with 21.2Mt for 1Q 2016.
[3]At the Extraordinary General Meeting held on May 10, 2017, the ArcelorMittal Shareholders approved a share consolidation based on a ratio 1:3, whereby every three current shares will be 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 do not reflect this change and are prior to the share consolidation. See Appendix 7 for the EPS calculated after the share consolidation exercise.