Luxembourg, May 9, 2014 – 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, 2014.
Highlights:
- Health and safety: LTIF rate[2] of 0.85x in 1Q 2014 as compared to 0.93x in 1Q 2013
- EBITDA[3] of $1.8 billion in 1Q 2014, a 23% improvement as compared to 1Q 2013 on an underlying basis[4]; EBITDA/t increased in all steel segments with the exception of NAFTA which was negatively impacted by extreme weather
- Net loss of $0.2 billion in 1Q 2014 as compared to a net loss of $0.3 billion in 1Q 2013
- Steel shipments of 21.0Mt, an increase of 2.4% as compared to 1Q 2013
- 14.8 Mt own iron ore production as compared to 13.1 Mt in 1Q 2013; 9.3 Mt shipped and reported at market prices[5] as compared to 7.3 Mt in 1Q 2013
- Net debt[6] of $18.5 billion as of March 31, 2014 an increase of $2.4 billion during the quarter due to investment in working capital and other payables ($1.3 billion), the early redemption of perpetual securities ($0.7 billion), M&A ($0.2 billion) and foreign exchange ($0.1 billion)
Key developments:
- AM/NS Calvert: In partnership with Nippon Steel & Sumitomo Metal Corporation, the acquisition of ThyssenKrupp Steel USA, a steel processing plant in Calvert, Alabama, was completed on Feb 26, 2014 for a purchase price of $1.55 billion
- Mining: opportunity to stretch iron ore production capacity from current target of 84Mt by end 2015 to 95Mt has been identified, due to additional 5Mtpa potential at Liberia and additional 6Mtpa potential at ArcelorMittal Mines Canada
Outlook and guidance framework:
- Based on its guidance framework, the Company continues to anticipate 2014 EBITDA of approximately $8.0 billion, assuming:
a) Steel shipments increase by approximately 3% in 2014 as compared to 2013
b) Marketable iron ore shipments increase by approximately 15%
c) The iron ore price averages approximately $120/t (for 62% Fe CFR China)
d) A moderate improvement in steel margins
- Net interest expense is expected to be approximately $1.6 billion for 2014
- Capital expenditure is expected to be approximately $3.8-4.0 billion for 2014
- The Company maintains its medium term net debt target at $15 billion
Financial highlights (on the basis of IFRS[1]):
| (USDm) unless otherwise shown | 1Q 14 | 4Q 13 | 3Q 13 | 2Q 13 | 1Q 13 |
|---|---|---|---|---|---|
| Sales | 19,788 | 19,848 | 19,643 | 20,197 | 19,752 |
| EBITDA | 1,754 | 1,910 | 1,713 | 1,700 | 1,565 |
| Operating income / (loss) | 674 | (36) | 477 | 352 | 404 |
| Net loss | (205) | (1,227) | (193) | (780) | (345) |
| Basic loss per share (USD) | (0.12) | (0.69) | (0.12) | (0.44) | (0.21) |
| Own iron ore production (Mt) | 14.8 | 15.4 | 14.9 | 15.0 | 13.1 |
| Iron ore shipments at market price (Mt) | 9.3 | 10.3 | 9.4 | 8.2 | 7.3 |
| Crude steel production (Mt) | 23.0 | 23.0 | 23.3 | 22.5 | 22.4 |
| Steel shipments (Mt) | 21.0 | 20.5 | 20.7 | 20.9 | 20.5 |
| EBITDA/tonne (US$/t)[7] | 84 | 93 | 83 | 81 | 76 |
Commenting, Mr. Lakshmi N. Mittal, ArcelorMittal Chairman and CEO, said:
“Today’s figures continue to show the improved year-over-year performance of our business driven by recovering steel markets, the expansion of our mining operations, and the continued benefits of our focused cost optimization. The prospects for growth of our core markets in Europe and the US are encouraging and overall we remain cautiously optimistic about the business outlook for the rest of 2014”.
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[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”). While the interim financial information included in this announcement has been prepared in accordance with IFRS applicable to interim periods, 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]Lost time injury frequency rate equals lost time injuries per 1,000,000 worked hours, based on own personnel and contractors.
[3]EBITDA is defined as operating income plus depreciation, impairment expenses and restructuring charges / exceptional items.
[4]EBITDA in 1Q 2013 of $1,565 million included the positive impact of a $47 million fair valuation gain relating to the acquisition of an additional ownership interest in DJ Galvanizing in Canada and $92 million of DDH income.
[5]Market priced tonnes represent amounts of iron ore and coal from ArcelorMittal mines that could be sold to third parties on the open market. Market priced tonnes that are not sold to third parties are transferred from the Mining segment to the Company’s steel producing segments and reported at the prevailing market price. Shipments of raw materials that do not constitute market priced tonnes are transferred internally and reported on a cost-plus basis.
[6]Net debt refers to long-term debt, plus short-term debt, less cash and cash equivalents, restricted cash and short-term investments.
[7]EBITDA/t is calculated as total Group EBITDA divided by total steel shipments.