Luxembourg, February 10, 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 and twelve month periods ended December 31, 2016.
Highlights:
- Health and safety performance was stable in FY 2016 as compared to FY 2015 with annual LTIF rate of 0.82x
- FY 2016 operating income of $4.2 billion; operating income of $0.8 billion in 4Q 2016 as compared to operating loss of $5.3 billion in 4Q 2015
- FY 2016 EBITDA of $6.3 billion versus $5.2 billion in FY 2015; EBITDA of $1.7 billion in 4Q 2016; up 51% versus 4Q 2015
- FY 2016 net income of $1.8 billion as compared to FY 2015 net loss of $7.9 billion
- FY 2016 steel shipments of 83.9Mt (-0.8% YoY); 4Q 2016 steel shipments of 20.0Mt up +1.6% versus 4Q 2015
- FY 2016 iron ore shipments of 55.9Mt (-10.4% YoY), of which 33.6Mt shipped at market prices (-16.6% YoY); 4Q 2016 iron ore shipments of 13.5Mt (-13.4% YoY), of which 8.1Mt shipped at market prices (-17.5% YoY)
- Net debt decreased to $11.1 billion as of December 31, 2016; $4.6 billion lower as compared to December 31, 2015
Strategic progress in 2016:
The Company has continued to make progress on its strategic objectives during 2016, including:
- Action 2020 delivering with $0.9 billion contribution to 2016 operating results
- FY 2016 cash requirements of the business[2] limited to $4.5 billion, in line with targets
- Cash flow from operations exceeded capex, in line with targets
- Net debt/EBITDA reduced to 1.8x in FY 2016 versus 3.0x in FY 2015
Financial highlights (on the basis of IFRS[1]):
| (USDm) unless otherwise shown | 4Q 16 | 3Q 16 | 4Q 15 | 12M 16 | 12M 15 |
|---|---|---|---|---|---|
| Sales | 14,126 | 14,523 | 13,981 | 56,791 | 63,578 |
| Operating income / (loss) | 809 | 1,204 | (5,331) | 4,161 | (4,161) |
| Net income/(loss) attributable to equity holders of the parent | 403 | 680 | (6,686) | 1,779 | (7,946) |
| Basic earnings/(loss) per share (US$)[3] | 0.13 | 0.22 | (2.89) | 0.62 | (3.43) |
| Operating income/(loss)/ tonne (US$/t) | 40 | 59 | (270) | 50 | (49) |
| EBITDA | 1,661 | 1,897 | 1,103 | 6,255 | 5,231 |
| EBITDA/ tonne (US$/t) | 83 | 93 | 56 | 75 | 62 |
| Steel-only EBITDA/ tonne (US$/t) | 68 | 83 | 51 | 65 | 56 |
| Crude steel production (Mt) | 21.8 | 22.6 | 21.6 | 90.8 | 92.5 |
| Steel shipments (Mt) | 20.0 | 20.3 | 19.7 | 83.9 | 84.6 |
| Own iron ore production (Mt) | 13.9 | 13.7 | 15.5 | 55.2 | 62.8 |
| Iron ore shipped at market price (Mt) | 8.1 | 8.1 | 9.9 | 33.6 | 40.3 |
Commenting, Mr. Lakshmi N. Mittal, ArcelorMittal Chairman and CEO, said:
“2016 was a year of progress for ArcelorMittal, characterised by improving market conditions, a strong contribution from our Action 2020 programme and steps from governments to address unfair trade. As a result, EBITDA was comfortably in excess of initial expectations and, furthermore, we have delivered on our commitment to prioritise debt reduction, significantly strengthening our balance sheet and ending the year with the lowest level of net debt since the creation of the Company.
We enter 2017 with good momentum in the business and the market. Our increased confidence is reflected in the Board’s decision to increase capital expenditure for 2017. The improvement in performance is, however, from a low base so we will need to continue to prioritise improved returns. Central to this will be our Action 2020 programme which will sustainably improve the underlying performance of the business. We remain fully focussed on continuing the good progress in the three areas of cost optimisation, product mix and volume growth. In addition, given global overcapacity, ensuring fair trade remains crucial and we will continue to call for a comprehensive solution to unfair trade practises.”
[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 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. ArcelorMittal presents EBITDA, and EBITDA/tonne, which are non-GAAP financial measures and defined in appendix 7, 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]Cash requirements of the business are defined as below EBITDA cash costs/requirements (including capex) and excludes working capital changes and one-off items.
[3]Following the Company’s equity offering in April 2016, the earnings (loss) per share for prior periods have been recasted in accordance with IFRS for the three months and the twelve months ended December 31, 2015, to include the bonus element derived from the 35% discount to the theoretical ex-right price included in the subscription price.