Luxembourg, May 9, 2019 - 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 results1 for
the three-month period ended March 31, 2019.
Highlights:
- Health and safety: LTIF rate2 of 1.14x in 1Q 2019
- Operating income decreased to $0.8bn in 1Q 2019 as compared to
$1.0bn in 4Q 2018 and $1.6bn in 1Q 2018
- EBITDA of $1.7bn in 1Q 2019, 15.3% lower as compared to $2.0bn
in 4Q 2018, primarily reflecting a negative price-cost effect; 1Q
2019 EBITDA down 34.2% YoY
- Net income of $0.4bn in 1Q 2019
- Steel shipments of 21.8Mt in 1Q 2019, up 7.9% vs. 4Q 2018 and
up 2.2% vs. 1Q 2018
- 1Q 2019 iron ore shipments of 13.8Mt (stable YoY), of which
9.2Mt shipped at market prices (+0.4% YoY)
- Gross debt of $13.4bn as of March 31, 2019 as compared to
$12.6bn as of December 31, 2018. Net debt increased to $11.2bn as
of March 31, 2019 due to impact of IFRS 1612 lease accounting
($1.2bn). Excluding IFRS 16 Leases impact, net debt would be
$10.0bn as of March 31, 2019 as compared to $10.2bn as of December
31, 2018
- Maintaining an investment grade credit rating through the cycle
remains ArcelorMittal’s financial priority, with a target to reduce
net debt to below $7bn (previous target of $6bn adjusted to reflect
the impact of IFRS 16)
Financial highlights (on the basis of
IFRS1):
(USDm) unless otherwise shown |
1Q 19 |
4Q 18 |
3Q 18 |
2Q 18 |
1Q 18 |
Sales |
19,188 |
|
18,327 |
|
18,522 |
|
19,998 |
|
19,186 |
|
Operating income |
769 |
|
1,042 |
|
1,567 |
|
2,361 |
|
1,569 |
|
Net income attributable to equity holders of the parent |
414 |
|
1,193 |
|
899 |
|
1,865 |
|
1,192 |
|
Basic earnings per share (US$) |
0.41 |
|
1.18 |
|
0.89 |
|
1.84 |
|
1.17 |
|
|
|
|
|
|
|
Operating income/ tonne (US$/t) |
35 |
|
51 |
|
76 |
|
109 |
|
73 |
|
EBITDA |
1,652 |
|
1,951 |
|
2,729 |
|
3,073 |
|
2,512 |
|
EBITDA/ tonne (US$/t) |
76 |
|
96 |
|
133 |
|
141 |
|
118 |
|
Steel-only EBITDA/ tonne (US$/t) |
56 |
|
79 |
|
119 |
|
127 |
|
101 |
|
|
|
|
|
|
|
Crude steel production (Mt) |
24.1 |
22.8 |
23.3 |
23.2 |
23.3 |
Steel shipments (Mt) |
21.8 |
20.2 |
20.5 |
21.8 |
21.3 |
Own iron ore production (Mt) |
14.1 |
14.9 |
14.5 |
14.5 |
14.6 |
Iron ore shipped at market price (Mt) |
9.2 |
10.0 |
8.5 |
10.0 |
9.1 |
Commenting, Mr. Lakshmi N. Mittal,
ArcelorMittal Chairman and CEO, said:
"Our first quarter results reflect the challenging operating
environment the industry has faced in recent months. Profitability
has been impacted by lower steel pricing due to weaker
economic activity and continued global overcapacity, as well as
rising raw material costs as a result of supply-side developments
in Brazil.
“We continue to face a challenge from high levels of imports,
particularly in Europe, where safeguard measures introduced by the
European Commission have not been fully effective. Although we
are somewhat encouraged by the firmer price environment in China,
this is not being reflected in Europe where in order to adapt to
the current market environment we have recently announced
annualized production cuts of three million tonnes in our flat
steel operations. It is important there is a level playing
field to address unfair competition, and this includes a green
border adjustment to ensure that imports into Europe face the same
carbon costs as producers in Europe.
“We remain focussed on our own initiatives to improve
performance through delivery of our Action2020
plan. Generating positive free cash flow, demonstrating
progress in our efforts to further strengthen our balance sheet and
improve shareholder returns are the priority.”
Sustainable development and safety
performance
Health and safety - Own personnel and
contractors lost time injury frequency rate
Health and safety performance (inclusive of ArcelorMittal Italia
(previously known as Ilva)), based on own personnel figures and
contractors lost time injury frequency (LTIF) rate was 1.14x2 in
the first quarter of 2019 (“1Q 2019”).
Excluding the impact of ArcelorMittal Italia, the LTIF was 0.66x
for 1Q 2019 as compared to 0.70x for the fourth quarter of 2018
(“4Q 2018”) and 0.62x for the first quarter of 2018 (“1Q
2018”).
The Company’s efforts to improve its Health and Safety record
remain focused on both further reducing the rate of severe injuries
and preventing fatalities.
Own personnel and contractors -
Frequency rate2
Lost time injury frequency rate |
1Q 19 |
4Q 18 |
3Q 18 |
2Q 18 |
1Q 18 |
Mining |
0.38 |
|
0.64 |
|
0.63 |
|
0.62 |
|
0.34 |
|
NAFTA |
0.58 |
|
0.37 |
|
0.56 |
|
0.64 |
|
0.39 |
|
Brazil |
0.48 |
|
0.28 |
|
0.39 |
|
0.35 |
|
0.41 |
|
Europe |
0.85 |
|
1.11 |
|
0.76 |
|
1.02 |
|
0.77 |
|
ACIS |
0.75 |
|
0.59 |
|
0.61 |
|
0.52 |
|
0.79 |
|
Total Steel |
0.71 |
|
0.71 |
|
0.62 |
|
0.72 |
|
0.66 |
|
Total (Steel and Mining) |
0.66 |
|
0.70 |
|
0.62 |
|
0.71 |
|
0.62 |
|
ArcelorMittal Italia |
11.05 |
|
|
|
|
|
|
|
|
|
Total (Steel and Mining) including ArcelorMittal
Italia |
1.14 |
|
|
|
|
|
|
|
|
|
Key sustainable development highlights
for 1Q 2019:
- Recognized a Worldsteel Sustainability Champion for our
achievements in safety, water, lifecycle analysis and social and
environmental reporting.
- Announced preparations for an industrial scale pilot of
hydrogen based steelmaking in Hamburg, Germany.
- Completed independent pre-audit against ResponsibleSteel - a
multistakeholder standard due to launch at the end of 2019.
- On April 25, 2019, ArcelorMittal released a new film to mark
its 13th global health and safety day. The new film is designed to
reinforce the critical importance of a safety-first approach at all
times within the organisation. The film, which explores the day’s
theme, “We always choose the safest way”, supports a day of
activities designed to reinforce the Company’s safety culture. To
watch the video, go to:
https://corporate.arcelormittal.com/news-and-media/news/2019/apr/25-04-2019.
Analysis of results for 1Q 2019 versus
4Q 2018 and 1Q 2018
Total steel shipments in 1Q 2019 were 7.9% higher at 21.8Mt as
compared with 20.2Mt for 4Q 2018 primarily due to higher steel
shipments in Europe (+14.4%) due in part to the acquisition of
ArcelorMittal Italia (following its consolidation from November 1,
2018) and NAFTA (+2.8%), offset in part by lower steel shipments in
Brazil (-5.7%). Excluding the impact of ArcelorMittal Italia, steel
shipments were 5.0% higher as compared to 4Q 2018.
Total steel shipments in 1Q 2019 were 2.2% higher as compared
with 21.3Mt for 1Q 2018 primarily due to higher steel shipments in
Europe (+8.0%) due in part to the acquisition of ArcelorMittal
Italia and Brazil (+16.0%) due in part to the impact of the
Votorantim acquisition following its consolidation as from April
2018, offset in part by lower steel shipments in NAFTA (-4.3%) and
ACIS (-12.1%) which was impacted by operational issues in Temirtau,
Kazakhstan. Excluding the impacts of the ArcelorMittal Italia and
Votorantim acquisitions, steel shipments were 3.6% lower as
compared to 1Q 2018.
Sales in 1Q 2019 were $19.2 billion as compared to $18.3 billion
for 4Q 2018 and $19.2 billion for 1Q 2018. Sales in 1Q 2019 were
4.7% higher as compared to 4Q 2018 primarily due to higher steel
shipments (+7.9%) and higher seaborne iron ore reference prices
(+15.2%), offset in part by lower average steel selling prices
(-3.1%) and seasonally lower market-priced iron ore shipments
(-8.2%). Sales in 1Q 2019 were stable as compared to 1Q 2018 as the
impacts of lower average steel selling prices (-3.1%) were offset
by higher steel shipments (+2.2%) and higher seaborne iron ore
reference prices (+10.8%).
Depreciation for 1Q 2019 was higher at $733 million as compared
to $723 million for 4Q 2018. These charges now include the
depreciation of right-of-use assets recognized for the first time
within property, plant and equipment under IFRS 16 lease
accounting, that were previously recorded in cost of sales and
selling, general and administrative expenses. 1Q 2019 depreciation
expense was higher than $711 million in 1Q 2018 primarily due to
the impact of IFRS 16 partially offset by foreign exchange gains.
As a result of IFRS 16 and the impact of ArcelorMittal Italia net
of remedies depreciation expense for FY 2019 is expected to
increase to approximately $3.1 billion.
Impairment charges for 1Q 2019 were $150 million related to the
remedy asset sales for the ArcelorMittal Italia acquisition.
Impairment charges net of purchases gains for 4Q 2018 were $215
million3 and primarily related to the acquisition of ArcelorMittal
Italia and the remedy asset sales for the ArcelorMittal Italia
acquisition. Impairment charges for 1Q 2018 were $86 million
related to the agreed remedy package required for the approval of
the Votorantim acquisition4.
Exceptional items for 1Q 2019 were nil. Exceptional income for
4Q 2018 were $29 million primarily related to $202 million for
PIS/Cofins tax credits10 related to prior periods recognized in
Brazil, offset in part by $113 million in charges related to a
blast furnace dismantling in Florange (France), and $60 million
related to the new collective labour agreement in the US (including
a signing bonus). Exceptional charges for 1Q 2018 were $146 million
related to a provision taken in respect of a litigation case that
was paid in 3Q 20185.
Operating income for 1Q 2019 was lower at $0.8 billion as
compared to $1.0 billion in 4Q 2018 and $1.6 billion in 1Q 2018
primarily driven by weaker operating conditions (negative
price-cost effect in the steel segments) reflecting both the impact
of the decline in steel prices since 4Q 2018 and higher raw
material prices, offset in part by the impact of higher seaborne
iron ore reference prices and higher steel shipments. Operating
results for 1Q 2019, 4Q 2018, and 1Q 2018 were impacted by
impairment charges net of purchase gains and exceptional items as
discussed above.
Income from associates, joint ventures and other investments for
1Q 2019 was $208 million as compared to $227 million for 4Q 2018
and $212 million for 1Q 2018. 1Q 2019 and 1Q 2018 were positively
impacted by the annual dividend declared by Erdemir ($93 million
and $87 million, respectively). 4Q 2018 was positively impacted by
$0.1 billion in currency translation gains following the disposal
of ArcelorMittal’s investment in MacSteel (South Africa).
Net interest expense in 1Q 2019 was $161 million as compared to
$140 million in 4Q 2018 and lower than $164 million in 1Q 2018. 1Q
2019 net interest increased due to new bonds issued during the
quarter and the first-time adoption of IFRS 16 leases. The Company
expects full year 2019 net interest expense to increase to
approximately $0.65 billion from previous guidance of approximately
$0.6 billion primarily due to the impact of IFRS
16.
Foreign exchange and other net financing losses in 1Q 2019 were
$231 million as compared to $556 million for 4Q 2018 and $174
million in 1Q 2018. Foreign exchange loss for 1Q 2019 was $48
million as compared to a loss of $7 million in 4Q 2018 and a gain
of $72 million in 1Q 20186. 1Q 2019 includes non-cash
mark-to-market losses of $6 million related to the mandatory
convertible bonds call option as compared to losses of $443 million
in 4Q 2018 and $35 million in 1Q 2018.
ArcelorMittal recorded an income tax expense of $135 million in
1Q 2019 as compared to an income tax benefit of $711 million for 4Q
2018 and an income tax expense of $203 million for 1Q 2018. The
income tax benefit for 4Q 2018 includes a $0.8 billion deferred tax
benefit recorded mainly in Luxembourg resulting from the
expectation of higher future profits.
Income attributable to non-controlling interests was $36 million
for 1Q 2019 as compared to $91 million for 4Q 2018 and $48 million
in 1Q 2018 and relates primarily to profits in ArcelorMittal Mines
Canada and Bekaert (Brazil). Income attributable to non-controlling
interests in 4Q 2018 included the share of currency translation
gain following the disposal of MacSteel as mentioned above.
ArcelorMittal recorded a net income for 1Q 2019 of $0.4 billion,
or $0.41 basic earnings per share, as compared to a net income for
4Q 2018 of $1.2 billion, or $1.18 basic earnings per share, and a
net income for 1Q 2018 of $1.2 billion, or $1.17 basic earnings per
share.
Analysis of segment operations
NAFTA
(USDm) unless otherwise shown |
1Q 19 |
4Q 18 |
3Q 18 |
2Q 18 |
1Q 18 |
Sales |
5,085 |
|
4,857 |
|
5,367 |
|
5,356 |
|
4,752 |
|
Operating income |
216 |
|
310 |
|
612 |
|
660 |
|
308 |
|
Depreciation |
(134 |
) |
(127 |
) |
(132 |
) |
(131 |
) |
(132 |
) |
Exceptional charges |
— |
|
(60 |
) |
— |
|
— |
|
— |
|
EBITDA |
350 |
|
497 |
|
744 |
|
791 |
|
440 |
|
Crude steel production (kt) |
5,388 |
|
5,026 |
|
5,723 |
|
5,946 |
|
5,864 |
|
Steel shipments (kt) |
5,319 |
|
5,173 |
|
5,512 |
|
5,803 |
|
5,559 |
|
Average steel selling price (US$/t) |
874 |
|
882 |
|
896 |
|
853 |
|
779 |
|
NAFTA segment crude steel production increased by 7.2% to 5.4Mt
in 1Q 2019 as compared to 5.0Mt in 4Q 2018. This increase reflects
higher production in the US, despite an approximate 100kt loss due
to a power outage at Burns Harbor, and to a much lesser extent the
eventual restart of the blast furnace in Mexico which had suffered
delays following scheduled maintenance in 3Q 2018.
Steel shipments in 1Q 2019 increased by 2.8% to 5.3Mt as
compared to 5.2Mt in 4Q 2018 with improvements in the flat business
(+7.8%) offset by weaker long product shipments (-19.0%), primarily
in Mexico due to less availability of material due to delayed
restart of the blast furnace as discussed above.
Sales in 1Q 2019 increased by 4.7% to $5.1 billion as compared
to $4.9 billion in 4Q 2018, primarily due to higher steel shipments
(+2.8%) offset in part by lower average steel selling prices
(-0.9%, flat products were down -2.3% whilst long products
increased 1.7%).
Exceptional charges for 4Q 2018 were $60 million related to the
new collective labour agreement in the US (which included a signing
bonus).
Operating income in 1Q 2019 of $216 million was lower as
compared to $310 million in 4Q 2018 and $308 million in 1Q 2018.
Operating results for 4Q 2018 were impacted by the exceptional
charges as discussed above.
EBITDA in 1Q 2019 decreased by 29.6% to $350 million as compared
to $497 million in 4Q 2018 primarily due to negative price-cost
effect offset in part by higher steel shipment volumes. EBITDA in
1Q 2019 was also negatively impacted by $32 million on account of
the Burns Harbor power outage discussed above. EBITDA in 1Q 2019
decreased by 20.5% as compared to $440 million in 1Q 2018 primarily
due to lower steel shipments (-4.3%).
Brazil
(USDm) unless otherwise shown |
1Q 19 |
4Q 18 |
3Q 18 |
2Q 18 |
1Q 18 |
Sales |
2,156 |
|
2,429 |
|
2,103 |
|
2,191 |
|
1,988 |
|
Operating income |
239 |
|
398 |
|
374 |
|
369 |
|
215 |
|
Depreciation |
(70 |
) |
(84 |
) |
(71 |
) |
(74 |
) |
(69 |
) |
Impairment |
— |
|
— |
|
— |
|
— |
|
(86 |
) |
Exceptional income |
— |
|
202 |
|
— |
|
— |
|
— |
|
EBITDA |
309 |
|
280 |
|
445 |
|
443 |
|
370 |
|
Crude steel production (kt) |
3,013 |
|
3,191 |
|
3,158 |
|
3,114 |
|
2,801 |
|
Steel shipments (kt) |
2,880 |
|
3,053 |
|
3,097 |
|
2,831 |
|
2,483 |
|
Average steel selling price (US$/t) |
704 |
|
687 |
|
714 |
|
728 |
|
752 |
|
Brazil segment crude steel production decreased by 5.6% to 3.0Mt
in 1Q 2019 as compared to 3.2Mt for 4Q 2018.
Steel shipments in 1Q 2019 decreased by 5.7% to 2.9Mt as
compared to 4Q 2018, due to lower export volumes for both flat and
long products, partially offset by increased domestic shipments of
flat products.
Sales in 1Q 2019 decreased by 11.2% to $2.2 billion as compared
to $2.4 billion in 4Q 2018, due to lower steel shipments offset in
part by 2.4% higher average steel selling prices mainly due to
improvement in long products.
Exceptional income for 4Q 2018 was $202 million related to
PIS/Cofins tax credits related to prior periods recognized in
Brazil.
Operating income in 1Q 2019 was lower at $239 million as
compared to $398 million in 4Q 2018 but higher than $215 million in
1Q 2018. Operating results for 4Q 2018 were impacted by the
exceptional income as discussed above. Operating income in 1Q 2018
was impacted by impairment of $86 million (Cariacica and Itaúna
industrial plants in Brazil) related to the agreed remedy package
required for the approval of the Votorantim acquisition.
EBITDA in 1Q 2019 increased by 10.6% to $309 million as compared
to $280 million in 4Q 2018 primarily due to a positive price-cost
effect. 4Q 2018 included a one-time provision of $17 million for
employee related charges. EBITDA in 1Q 2019 was 16.3% lower as
compared to $370 million in 1Q 2018 primarily due to foreign
exchange translation impact and challenging market conditions in
Argentina.
Europe
(USDm) unless otherwise shown |
1Q 19 |
4Q 18 |
3Q 18 |
2Q 18 |
1Q 18 |
Sales |
10,494 |
|
9,761 |
|
9,559 |
|
10,527 |
|
10,641 |
|
Operating income |
11 |
|
98 |
|
100 |
|
853 |
|
580 |
|
Depreciation |
(309 |
) |
(323 |
) |
(262 |
) |
(292 |
) |
(318 |
) |
Impairment charges net of purchase gains |
(150 |
) |
(215 |
) |
(509 |
) |
— |
|
— |
|
Exceptional charges |
— |
|
(113 |
) |
— |
|
— |
|
(146 |
) |
EBITDA |
470 |
|
749 |
|
871 |
|
1,145 |
|
1,044 |
|
Crude steel production (kt) |
12,372 |
|
11,580 |
|
10,841 |
|
11,026 |
|
11,246 |
|
Steel shipments (kt) |
11,553 |
|
10,098 |
|
9,709 |
|
10,516 |
|
10,697 |
|
Average steel selling price (US$/t) |
729 |
|
771 |
|
776 |
|
800 |
|
801 |
|
Europe segment crude steel production increased by 6.8% to
12.4Mt in 1Q 2019 as compared to 11.6Mt in 4Q 2018 due in part to
the ArcelorMittal Italia acquisition (consolidated as from November
1, 2018).
Steel shipments in 1Q 2019 increased by 14.4% to 11.6Mt as
compared to 10.1Mt in 4Q 2018. Excluding the impact of
ArcelorMittal Italia, steel shipments increased by 9% as compared
to 4Q 2018, but were 2.8% lower than 1Q 2018.
Sales in 1Q 2019 were $10.5 billion, 7.5% higher as compared to
$9.8 billion in 4Q 2018, with higher steel shipments, as discussed
above, offset in part by 5.4% lower average steel selling prices
(both flat and long products declining).
Impairment charges net of purchase gains for 1Q 2019 and 4Q 2018
were $150 million and $215 million, respectively, primarily related
to the ArcelorMittal Italia acquisition in 4Q 2018 and the
associated remedy asset sales for the ArcelorMittal Italia in 2018
and 1Q 2019. Impairment charges net of purchase gains for 1Q 2018
were nil.
Exceptional charges for 1Q 2019 were nil. Exceptional charges
for 4Q 2018 were $113 million related to a blast furnace
dismantling in Florange (France). Exceptional charges for 1Q 2018
were $146 million related to a provision taken in respect of a
litigation case that was paid in 3Q 2018.
Operating income in 1Q 2019 was $11 million as compared to $98
million in 4Q 2018 and $580 million in 1Q 2018. Operating results
were impacted by impairment charges net of purchase gains and
exceptional items as discussed above.
Despite higher steel shipments, EBITDA in 1Q 2019 decreased by
37.3% to $470 million as compared to $749 million in 4Q 2018
primarily due to a negative price-cost effect. EBITDA in 1Q 2019
decreased by 55.0% as compared to $1,044 million in 1Q 2018,
primarily due to lower steel shipments, foreign exchange, negative
price-cost effect and losses of ArcelorMittal Italia.
ACIS
(USDm) unless otherwise shown |
1Q 19 |
4Q 18 |
3Q 18 |
2Q 18 |
1Q 18 |
Sales |
1,645 |
|
1,763 |
|
1,989 |
|
2,129 |
|
2,080 |
|
Operating income |
64 |
|
121 |
|
371 |
|
312 |
|
290 |
|
Depreciation |
(81 |
) |
(77 |
) |
(76 |
) |
(85 |
) |
(73 |
) |
EBITDA |
145 |
|
198 |
|
447 |
|
397 |
|
363 |
|
Crude steel production (kt) |
3,323 |
|
2,975 |
|
3,560 |
|
3,087 |
|
3,400 |
|
Steel shipments (kt) |
2,662 |
|
2,669 |
|
2,986 |
|
3,057 |
|
3,029 |
|
Average steel selling price (US$/t) |
541 |
|
561 |
|
597 |
|
621 |
|
610 |
|
ACIS segment crude steel production in 1Q 2019 increased by
11.7% to 3.3Mt as compared to 3.0Mt in 4Q 2018 primarily due to the
restart of production in Temirtau (Kazakhstan) following an
explosion at a gas pipeline in 4Q 2018.
Steel shipments in 1Q 2019 were stable at 2.7Mt as compared to
4Q 2018.
Sales in 1Q 2019 decreased by 6.7% to $1.6 billion as compared
to $1.8 billion in 4Q 2018 primarily due to lower average steel
selling prices (-3.6%).
Operating income in 1Q 2019 was lower at $64 million as compared
to $121 million in 4Q 2018 and $290 million in 1Q 2018.
EBITDA in 1Q 2019 decreased by 26.9% to $145 million as compared
to $198 million in 4Q 2018 primarily due to a negative price-cost
effect. EBITDA in 1Q 2019 was lower as compared to $363 million in
1Q 2018, primarily due to lower steel shipments (-12.1%) and
negative price-cost effect.
Mining
(USDm) unless otherwise shown |
1Q 19 |
4Q 18 |
3Q 18 |
2Q 18 |
1Q 18 |
Sales |
1,127 |
|
1,114 |
|
1,008 |
|
1,065 |
|
1,024 |
|
Operating income |
313 |
|
241 |
|
179 |
|
198 |
|
242 |
|
Depreciation |
(107 |
) |
(102 |
) |
(102 |
) |
(107 |
) |
(107 |
) |
EBITDA |
420 |
|
343 |
|
281 |
|
305 |
|
349 |
|
|
|
|
|
|
|
Own iron ore production (a) (Mt) |
14.1 |
|
14.9 |
|
14.5 |
|
14.5 |
|
14.6 |
|
Iron ore shipped externally and internally at market price (b)
(Mt) |
9.2 |
|
10.0 |
|
8.5 |
|
10.0 |
|
9.1 |
|
Iron ore shipment - cost plus basis (Mt) |
4.6 |
|
5.7 |
|
5.6 |
|
4.6 |
|
4.7 |
|
Own coal production (a) (Mt) |
1.2 |
|
1.3 |
|
1.5 |
|
1.6 |
|
1.5 |
|
Coal shipped externally and internally at market price (b)
(Mt) |
0.7 |
|
0.7 |
|
0.7 |
|
0.7 |
|
0.4 |
|
Coal shipment - cost plus basis (Mt) |
0.7 |
|
0.7 |
|
0.9 |
|
0.9 |
|
0.9 |
|
(a) Own iron ore and coal production not including strategic
long-term contracts.(b) Iron ore and coal shipments of
market-priced based materials include the Company’s own mines and
share of production at other mines, and exclude supplies under
strategic long-term contracts.
Own iron ore production in 1Q 2019 decreased by 5.8% to 14.1Mt
as compared to 14.9Mt in 4Q 2018, due to seasonally lower
production in ArcelorMittal Mines Canada7 (AMMC), the temporary
suspension of Serra Azul in Brazil (following evacuation on
February 8, 2019 which has since been restarted on March 18, 2019;
see key recent developments), and lower production in Temirtau and
Hibbing (US) offset by increased production in Liberia. Own iron
ore production in 1Q 2019 decreased by 3.7% as compared to 1Q 2018
primarily due to lower production in Temirtau, Mexico and Serra
Azul in Brazil offset in part by increased production at AMMC.
Market-priced iron ore shipments in 1Q 2019 decreased by 8.2% to
9.2Mt as compared to 10.0Mt in 4Q 2018, primarily driven by
seasonally lower market-priced iron ore shipments in AMMC.
Market-priced iron ore shipments in 1Q 2019 were largely stable as
compared to 1Q 2018 driven by higher shipments in Liberia, offset
by lower shipments in AMMC (extreme weather conditions) and in
Ukraine. Market-priced iron ore shipments for FY 2019 are expected
to be broadly stable as compared to FY 2018 with increases in
Liberia and AMMC to be offset by lower volume in Mexico (in part
due to the end of life of Volcan mine).
Own coal production in 1Q 2019 decreased by 6.8% to 1.2Mt as
compared to 1.3Mt in 4Q 2018 primarily due to lower production at
Princeton (US). Own coal production in 1Q 2019 decreased by 19.7%
as compared to 1.5Mt in 1Q 2018 due to lower production at
Kazakhstan and Princeton (US).
Market-priced coal shipments in 1Q 2019 were stable at 0.7Mt as
compared to 4Q 2018. Market-priced coal shipments in 1Q 2019
increased by 59.9% as compared to 1Q 2018 primarily due to
increased shipments at Kazakhstan.
Operating income in 1Q 2019 increased to $313 million as
compared to $241 million in 4Q 2018 and $242 million in 1Q
2018.
EBITDA in 1Q 2019 increased by 22.5% to $420 million as compared
to $343 million in 4Q 2018, primarily due to the impact of higher
seaborne iron ore reference prices (+15.2%) offset in part by lower
market-priced iron ore shipments (-8.2%). EBITDA in 1Q 2019 was
20.4% higher as compared to $349 million in 1Q 2018, primarily due
to higher seaborne iron ore reference prices (+10.8%).
Liquidity and Capital Resources
For 1Q 2019 net cash provided by operating activities was $971
million as compared to $2,170 million in 4Q 2018 and $160 million
in 1Q 2018. The cash provided by operating activities during 1Q
2019 reflects in part a working capital investment of $553 million
(largely on account of higher steel shipment volumes) as compared
to a working capital release of $430 million in 4Q 2018. The net
cash provided by operating activities during 1Q 2018 reflected a
working capital investment of $1,869 million.
Due to a smaller than anticipated release in 4Q 2018, the Group
invested more in working capital than expected in 2018 ($4.4
billion versus guidance of $3.0-3.5 billion). The Group continues
to expect this excess working capital to be released over the
course of 2019. The 1Q 2019 working capital investment followed the
normal seasonal pattern but was less pronounced than in prior years
given the excess build-up in 4Q 2018. The extent of any further
changes in working capital in 2019 will be dictated by market
conditions, particularly the price and volume environment in the
final weeks of the year.
Net cash used in investing activities during 1Q 2019 was $693
million as compared to $1,926 million during 4Q 2018 and $676
million in 1Q 2018. Capex decreased to $947 million in 1Q 2019 as
compared to $1,156 million in 4Q 2018 and increased as compared to
$752 million in 1Q 2018. Capex in 2019 is expected to increase to
$4.3 billion (as compared to $3.3 billion in 2018) reflecting carry
over from underspend in 2018, the impact of ArcelorMittal Italia,
the continued projected high return investments in Mexico and
Brazil and other strategic projects (largely cost optimization).
Net cash provided by other investing activities in 1Q 2019 of $254
million primarily includes $0.3 billion due to the rollover of the
Indian rupee hedge at market price which protects the dollar funds
needed for the Essar transaction as per the resolution plan
approved by the Committee of Creditors and the National Company Law
Tribunal in Ahmedabad, offset in part by the quarterly lease
payment for the ArcelorMittal Italia acquisition ($51 million). Net
cash used in other investing activities in 4Q 2018 of $770 million
primarily includes $1.0 billion investment for the repayment of
Uttam Galva and KSS Petron debts (India), quarterly lease payment
for ArcelorMittal Italia acquisition ($52 million) offset in part
by MacSteel (South Africa) disposal proceeds ($220 million). Net
cash provided by other investing activities in 1Q 2018 of $76
million primarily included proceeds from the sale of Frydek Mistek
in Czech Republic.
Net cash used in financing activities in 1Q 2019 was $344
million as compared to $411 million and $33 million in 4Q 2018 and
1Q 2018, respectively. In 1Q 2019, net outflow of debt repayments
and issuances of $136 million includes $1 billion repayment of
amounts borrowed in connection with the purchase of the Uttam Galva
and KSS Petron debts, $0.9 billion repayment of the €750 million
5-year, 3% bond at maturity; and offset in part by $1.6 billion
cash received from the issuance of two new bonds (€750 million
2.25% notes due 2024 and $750 million 4.55% notes due 2026) and
$0.2 billion commercial paper issuance. In 4Q 2018, net outflow of
debt repayments and issuances of $406 million primarily includes
repayment of short-term facilities. During 1Q 2019, the Company
paid dividends of $46 million to minority shareholders in AMMC
(Canada). During 4Q 2018, the Company paid dividends of $32 million
primarily to minority shareholders in Bekaert (Brazil). During 1Q
2018, the Company paid dividends of $50 million to minority
shareholders in AMMC (Canada).
During 1Q 2019, the Company completed its share buyback
programme having repurchased 4 million shares for a total value of
$90 million (€80 million) at an approximate average price per share
of $22.42 (€19.89 per share).
Outflows from lease principal payments and other financing
activities (net) were $72 million in 1Q 2019 as compared to inflows
of $27 million in 4Q 2018 and outflows of $20 million in 1Q 2018.
The cash outflow increased as a result of the first-time
application of IFRS 16, as the repayments of the principal portion
of the operating leases are presented under financing activities
(previously reported under operating activities). 4Q 2018 also
included the net proceeds from transactions with minority
shareholders primarily in relation to the ArcelorMittal Italia
transactions.
As of March 31, 2019, the Company’s cash and cash equivalents
amounted to $2.2 billion as compared to $2.4 billion at December
31, 2018 and $2.3 billion at March 31, 2018.
Gross debt increased to $13.4 billion as of March 31, 2019, as
compared to $12.6 billion at December 31, 2018, following the
adoption of the new IFRS 16 Leases standard effective from January
1, 2019, which requires most operating leases to be recognized on
the balance sheet as debt ($1.2 billion). As of March 31, 2019, net
debt increased to $11.2 billion as compared to $10.2 billion as of
December 31, 2018, largely due to the impact of IFRS 16 lease
accounting as discussed above. Excluding the impact of IFRS 16, net
debt was $10.0 billion, lower as compared to December 31, 2018
($10.2 billion).
As of March 31, 2019, the Company had liquidity of $7.7 billion,
consisting of cash and cash equivalents of $2.2 billion and $5.5
billion of available credit lines8. The $5.5 billion credit
facility contains a financial covenant not to exceed 4.25x Net debt
/ LTM EBITDA (as defined in the facility). As of March 31, 2019,
the average debt maturity was 4.9 years.
Key recent developments
- On May 7, 2019, ArcelorMittal announced that due to the
continuing uncertainties surrounding the long-term future of iron
ore production in Prijedor, ArcelorMittal Prijedor has had to take
the difficult decision to reduce iron ore production from 1.5 to 1
million tonnes at its Omarska mine in order to protect the maximum
possible number of jobs for the longer term. ArcelorMittal
Prijedor’s sole customer – ArcelorMittal Zenica – is consequently
reducing its consumption of iron ore from Omarska and will instead
import additional iron ore from outside Bosnia and Herzegovina. By
lowering production to one million tonnes a year, the effective
life of the Omarska mine will be extended by up to 10 years.
Without taking these measures, the mine would have to close in
2025. The new plan is expected to commence from September 1, 2019.
We deeply regret that these essential measures will unavoidably
lead to the loss of 300 jobs at ArcelorMittal Prijedor. This is
significant proportion of the approximately 800 people currently
employed by ArcelorMittal Prijedor but we have been forced to take
this difficult decision due to the lack of certainty surrounding
the future of mining in Prijedor. The company will work closely
with Union representatives and provide all possible assistance to
those affected.
- On May 7, 2019, the Annual General Meeting of shareholders of
ArcelorMittal held in Luxembourg approved all resolutions by a
strong majority. 69.77% of the voting rights were represented at
the general meeting. The results of the votes will be posted
shortly on www.arcelormittal.com under "Investors >
Equity Investors > Shareholders’ meetings > Annual General
Meeting of shareholders, 7 May 2019" where the full documentation
regarding the general meeting is available. The shareholders
re-elected Mrs. Vanisha Mittal Bhatia, Mrs. Suzanne Nimocks,
Mr.Jeannot Krecké and Mr. Karel De Gucht as directors of
ArcelorMittal for a term of three years each.
- On May 6, 2019, ArcelorMittal announced its intention to
temporarily idle production at its steelmaking facilities in
Kraków, Poland and reduce production in Asturias, Spain. In
addition, the planned increase of shipments at ArcelorMittal Italia
to a six million tonne annual run-rate will be slowed down
following a decision to optimise cost and quality over volume in
this environment. Together, these actions will result in a
temporary annualised production reduction of around three million
tonnes.
- On April 17, 2019, ArcelorMittal announced that it had received
European Commission (‘EC’) approval for the sale of several
steelmaking assets to Liberty House Group. The assets form a
divestment package the Company agreed with the European Commission
(‘EC’) during its merger control investigation into the Company’s
acquisition of Ilva S.p.A. Assets included within the divestment
package are ArcelorMittal Ostrava (Czech Republic), ArcelorMittal
Galati (Romania), ArcelorMittal Skopje (Macedonia), ArcelorMittal
Piombino (Italy), ArcelorMittal Dudelange (Luxembourg) and several
finishing lines at ArcelorMittal Liège (Belgium). Transaction
closing is expected to occur before the end of the first half of
this year, with the majority of proceeds expected to be received on
closing.
- Pursuant to Essar Steel India Limited’s (‘ESIL’) corporate
insolvency process, the Company’s Resolution Plan was conditionally
approved by India’s National Company Law Tribunal (‘NCLT’) on March
8, 2019. There have been several appeals from, among others, the
Committee of Creditors and ESIL creditors to the National Company
Law Appellate Tribunal (‘NCLAT’) over how the Committee of
Creditors has decided to distribute the 42,000-crore rupee upfront
payment from the Company’s Resolution Plan and how such payment
should be distributed among the creditors of ESIL. On April 12,
2019 India’s Supreme Court stayed the disbursement of funds to
creditors, pending the final outcome of the NCLAT hearing, which is
ongoing. The transaction closing is expected 2Q 2019 / 3Q
2019.
- On March 19 and 20, 2019, ArcelorMittal hosted an investor
event at the ArcelorMittal Italia facility in Taranto (Italy). The
event, hosted by Aditya Mittal and other members of the senior
management team, included presentations focused on the competitive
progress at ArcelorMittal Europe Flat Products, including its
significant contribution to Action 2020 through its Transformation
plan (and the equally impactful next phase in the Transformation
plan, driven by digitalization, positioning the Company to increase
the performance gap compared to competitors), and the strategy to
transform ArcelorMittal Italia into a modern, best-in-class,
integrated steel producer, capable of producing high-quality
products, satisfying its natural customer base and re-establishing
a trusted and transparent relationship with the local community and
other key stakeholders.
- On March 11, 2019, ArcelorMittal issued US$750,000,000
aggregate principal amount of its 4.550% notes due 2026. The
proceeds to ArcelorMittal, amounting to approximately $745 million,
were used towards repayment of existing debt including the $1
billion outstanding under a $7 billion term facilities agreement
entered into in connection with the proposed acquisition of Essar
Steel India Limited through a joint venture with Nippon Steel
Corporation.
- On February 19, 2019, ArcelorMittal announced the completion of
its share buyback programme on February 15, 2019. ArcelorMittal has
repurchased 4 million shares for a total value of approximately
€79,577,540 (equivalent $US 89,679,370) at an approximate average
price per share of $22.42 (€19.89). All details are available on
its website on:
https://corporate.arcelormittal.com/investors/equity-investors/share-buyback-2019.
- On February 8, 2019, the Company decided to implement an
evacuation plan downstream of its dormant Serra Azul tailing dam in
Brazil, evacuating the community situated downstream to the dam as
a precautionary measure based on an updated stability report
following recent incidents in the Brazilian mining sector in order
to undertake further testing and implement any necessary mitigation
measures. Movement of evacuated families to temporary rented
houses is now largely complete. Monthly emergency payments are
being made to those families relocated as well as people who lost
access to their land – in total there are 115 families (355 people)
directly impacted. For safety reasons, access to the evacuated
area continues to be restricted and controlled according to
guidance from local authorities. The reassessment of the dam
is progressing with support of international and in-country
specialists including the development of a plan to eventually
remove the material from the dormant dam for reprocessing, which
was due to commence in January 2019 as part of a longer-term plan
to remove that dormant tailings facility. An independent
technical audit reporting directly to the Public Prosecutors office
has been engaged by ArcelorMittal and will issue regular reports.
Continuous 24/7 monitoring of the tailings storage facility
continues via radar, accelerometers, on line water level,
piezometers and imaging. The Mining operations at Serra Azul were
restarted on March 18, 2019.
Recent publications and filings
- On April 29, 2019, ArcelorMittal published its 2018 integrated
annual review. The review underpins the Company’s commitment to
transparent reporting. It has been produced in-line with the
International Integrated Reporting Council’s framework and
demonstrates the Company’s approach to ensuring it brings
long-term, sustainable value to its broad stakeholder base. It
outlines the Company’s progress against its four strategic
priorities, namely: improving its safety performance; achieving its
financial targets; delivering on its Action 2020 strategic plan and
integrating sustainability into the business. The review, which can
be accessed online at http://annualreview2018.arcelormittal.com
includes videos of several members of ArcelorMittal’s senior
management team, including: Lakshmi Mittal, Chairman and CEO;
Aditya Mittal, President and CFO, ArcelorMittal and CEO,
ArcelorMittal Europe; Brian Aranha, executive vice president; and
David Clarke, vice president.
- On March 27, 2019, ArcelorMittal published the statutory
financial statements of ArcelorMittal parent company for the year
ended December 31, 2018. These financial statements have been filed
with the electronic database of the Luxembourg Stock Exchange
(www.bourse.lu) and are available on
http://corporate.arcelormittal.com under "Investors > Financial
reports > Annual reports".
- On March 1, 2019, ArcelorMittal published its annual report for
the year ended December 31, 2018. The report has been filed with
the electronic database of the Luxembourg Stock Exchange
(www.bourse.lu) and is available on
http://corporate.arcelormittal.com under "Investors > Financial
reports > Annual reports".
- On February 25, 2019, ArcelorMittal filed its Annual Report
2018 on Form 20-F with the U.S. Securities and Exchange Commission
(SEC). The report is now available on
http://corporate.arcelormittal.com under “Investors > Financials
reports > SEC filings”.
Outlook and guidance
Based on year-to-date growth and the current economic outlook,
ArcelorMittal expects global apparent steel consumption (“ASC”) to
grow further in 2019 by between +1.0% to +1.5% (up from previous
expectation of +0.5% to +1.0% growth). By region:
ArcelorMittal expects ASC in US to grow by +0.5% to +1.5% in
2019 (no change from previous expectation), driven by continued
growth in machinery and non-residential construction. In Europe,
driven by weak manufacturing and declining automotive production,
demand is now expected to contract by up to -1.0% (versus previous
expectation of a slight growth of up to +1.0%). In Brazil, our 2019
ASC forecasts have been slightly moderated to grow in a range of
+3.0% to +4.0% (from previous expectation of +3.5% to +4.5%)
after weaker than expected economic growth early in 2019. In the
CIS, ASC is expected to grow +1.0% to +2.0% in 2019 (no change from
previous expectation). Overall, World ex-China ASC is expected to
grow by approximately +1.0% to +2.0% in 2019 (down from previous
expectation of +2.0% to +3.0%). In China, overall demand is
expected to now grow by between +0% to +1.0% in 2019 (up from
previous forecast for a contraction in demand by -0.5% to -1.5%),
due to economic stimulus and as real estate demand continues to
surprise on the upside.
Given these demand expectations, the positive scope effect of
the ArcelorMittal Italia and Votorantim acquisition (net of the
remedy assets sales for the ArcelorMittal Italia acquisition), the
expectation that operational disruptions (both controllable and
uncontrollable) that negatively impacted 2018 shipments will not
recur, offset in part by impact of European production reduction,
the Group's steel shipments are expected to increase in 2019 vs
2018.
Market-priced iron ore shipments for FY 2019 are expected to be
broadly stable as compared to FY 2018 with increases in Liberia and
AMMC to be offset by lower volume in Mexico (in part due to the end
of life of Volcan mine).
The Company expects certain cash needs of the business
(including capex, interest, cash taxes, pensions and certain other
cash costs) but excluding working capital investment to be
approximately $6.4 billion in 2019. Capex is expected to be $4.3
billion including the continued investment in high returns projects
in Mexico and Brazil. Interest expense is expected to increase in
2019 to approximately $0.65 billion as compared to previous
forecast of $0.6 billion (primarily due to IFRS 16 impact) while
cash taxes, pensions and other cash costs are expected be $1.5
billion.
Due to a smaller than anticipated release in the final quarter
of 2018, the Group invested more in working capital than expected
in 2018 ($4.4 billion versus guidance of $3.0-3.5 billion). The
Group expects this additional investment of approximately $1
billion to be released over the course of 2019. The extent of any
further changes in working capital in 2019 will be dictated by
market conditions, particularly the price and volume environment in
the final weeks.
The Company will continue to prioritize deleveraging and
believes that $7 billion (previous target of $6 billion adjusted to
reflect impact of IFRS 16) is an appropriate net debt target that
will sustain investment grade metrics even at the low point of the
cycle. The Company will continue to invest in opportunities that
will enhance future returns. By investing in these opportunities
with focus and discipline, the cash flow generation potential of
the Company is expected to increase.
At meeting of shareholders at the Annual General Meeting on May
7, 2019, the shareholders voted in favor of an increase in the base
dividend for 201911 (paid from 2018 earnings) to $0.20 per share
from $0.10 per share. ArcelorMittal intends to progressively
increase the base dividend paid to its shareholders, and, on
attainment of the net debt target, the Company is committed to
returning a portion of annual FCF to shareholders.
ArcelorMittal Condensed Consolidated Statement of
Financial Position1
In millions of U.S. dollars |
Mar 31,2019 |
Dec 31,2018 |
Mar 31,2018 |
ASSETS |
|
|
|
Cash and
cash equivalents |
2,246 |
|
2,354 |
|
2,260 |
|
Trade
accounts receivable and other |
5,131 |
|
4,432 |
|
5,012 |
|
Inventories |
20,583 |
|
20,744 |
|
18,952 |
|
Prepaid
expenses and other current assets |
3,000 |
|
2,834 |
|
2,653 |
|
Assets
held for sale9 |
1,950 |
|
2,111 |
|
224 |
|
Total Current Assets |
32,910 |
|
32,475 |
|
29,101 |
|
|
|
|
|
Goodwill
and intangible assets |
5,549 |
|
5,728 |
|
5,759 |
|
Property,
plant and equipment |
36,647 |
|
35,638 |
|
37,031 |
|
Investments in associates and joint ventures |
5,000 |
|
4,906 |
|
5,231 |
|
Deferred
tax assets |
8,318 |
|
8,287 |
|
7,170 |
|
Other
assets |
4,236 |
|
4,215 |
|
3,671 |
|
Total Assets |
92,660 |
|
91,249 |
|
87,963 |
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY |
|
|
|
Short-term debt and current portion of long-term debt |
2,739 |
|
3,167 |
|
4,084 |
|
Trade
accounts payable and other |
14,232 |
|
13,981 |
|
13,494 |
|
Accrued
expenses and other current liabilities |
5,699 |
|
5,486 |
|
5,389 |
|
Liabilities held for sale9 |
828 |
|
821 |
|
42 |
|
Total Current Liabilities |
23,498 |
|
23,455 |
|
23,009 |
|
|
|
|
|
Long-term
debt, net of current portion |
10,591 |
|
9,316 |
|
9,309 |
|
Deferred
tax liabilities |
2,337 |
|
2,374 |
|
2,605 |
|
Other
long-term liabilities |
11,945 |
|
11,996 |
|
10,349 |
|
Total Liabilities |
48,371 |
|
47,141 |
|
45,272 |
|
|
|
|
|
Equity
attributable to the equity holders of the parent |
42,286 |
|
42,086 |
|
40,608 |
|
Non-controlling interests |
2,003 |
|
2,022 |
|
2,083 |
|
Total Equity |
44,289 |
|
44,108 |
|
42,691 |
|
Total Liabilities and Shareholders’ Equity |
92,660 |
|
91,249 |
|
87,963 |
|
ArcelorMittal Condensed Consolidated Statement of
Operations1
|
Three months ended |
In millions of U.S. dollars unless otherwise
shown |
Mar 31,2019 |
Dec 31,2018 |
Sep 30,2018 |
Jun 30,2018 |
Mar 31,2018 |
Sales |
19,188 |
|
18,327 |
|
18,522 |
|
19,998 |
|
19,186 |
|
Depreciation
(B) |
(733 |
) |
(723 |
) |
(653 |
) |
(712 |
) |
(711 |
) |
Impairment
charges net of purchase gains (B) |
(150 |
) |
(215 |
) |
(509 |
) |
— |
|
(86 |
) |
Exceptional
items (B) |
— |
|
29 |
|
— |
|
— |
|
(146 |
) |
Operating income (A) |
769 |
|
1,042 |
|
1,567 |
|
2,361 |
|
1,569 |
|
Operating
margin % |
4.0 |
% |
5.7 |
% |
8.5 |
% |
11.8 |
% |
8.2 |
% |
|
|
|
|
|
|
Income from
associates, joint ventures and other investments |
208 |
|
227 |
|
183 |
|
30 |
|
212 |
|
Net interest
expense |
(161 |
) |
(140 |
) |
(152 |
) |
(159 |
) |
(164 |
) |
Foreign
exchange and other net financing loss |
(231 |
) |
(556 |
) |
(475 |
) |
(390 |
) |
(174 |
) |
Income before taxes and non-controlling
interests |
585 |
|
573 |
|
1,123 |
|
1,842 |
|
1,443 |
|
Current tax expense |
(180 |
) |
(198 |
) |
(206 |
) |
(240 |
) |
(284 |
) |
Deferred tax benefit |
45 |
|
909 |
|
28 |
|
259 |
|
81 |
|
Income tax
(expense) / benefit |
(135 |
) |
711 |
|
(178 |
) |
19 |
|
(203 |
) |
Income including non-controlling interests |
450 |
|
1,284 |
|
945 |
|
1,861 |
|
1,240 |
|
Non-controlling interests (income) / loss |
(36 |
) |
(91 |
) |
(46 |
) |
4 |
|
(48 |
) |
Net
income attributable to equity holders of the parent |
414 |
|
1,193 |
|
899 |
|
1,865 |
|
1,192 |
|
|
|
|
|
|
|
Basic earnings per common share ($) |
0.41 |
|
1.18 |
|
0.89 |
|
1.84 |
|
1.17 |
|
Diluted earnings per common share ($) |
0.41 |
|
1.17 |
|
0.88 |
|
1.83 |
|
1.17 |
|
|
|
|
|
|
|
Weighted average common shares outstanding (in millions) |
1,014 |
|
1,014 |
|
1,014 |
|
1,013 |
|
1,019 |
|
Diluted weighted average common shares outstanding (in
millions) |
1,017 |
|
1,020 |
|
1,019 |
|
1,018 |
|
1,023 |
|
|
|
|
|
|
|
OTHER INFORMATION |
|
|
|
|
|
EBITDA (C =
A-B) |
1,652 |
|
1,951 |
|
2,729 |
|
3,073 |
|
2,512 |
|
EBITDA
Margin % |
8.6 |
% |
10.6 |
% |
14.7 |
% |
15.4 |
% |
13.1 |
% |
|
|
|
|
|
|
Own iron ore production (Mt) |
14.1 |
|
14.9 |
|
14.5 |
|
14.5 |
|
14.6 |
|
Crude
steel production (Mt) |
24.1 |
|
22.8 |
|
23.3 |
|
23.2 |
|
23.3 |
|
Steel
shipments (Mt) |
21.8 |
|
20.2 |
|
20.5 |
|
21.8 |
|
21.3 |
|
ArcelorMittal Condensed Consolidated Statement of Cash
flows1
|
Three months ended |
In millions of U.S. dollars |
Mar 31,2019 |
Dec 31,2018 |
Sep 30,2018 |
Jun 30,2018 |
Mar 31,2018 |
Operating
activities: |
|
|
|
|
|
Income
attributable to equity holders of the parent |
414 |
|
1,193 |
|
899 |
|
1,865 |
|
1,192 |
|
Adjustments to reconcile net income to net cash provided by
operations: |
|
|
|
|
|
Non-controlling interests income/ (loss) |
36 |
|
91 |
|
46 |
|
(4 |
) |
48 |
|
Depreciation and impairment charges net of purchase gains |
883 |
|
938 |
|
1,162 |
|
712 |
|
797 |
|
Exceptional items5 |
— |
|
(29 |
) |
— |
|
— |
|
146 |
|
Income
from associates, joint ventures and other investments |
(208 |
) |
(227 |
) |
(183 |
) |
(30 |
) |
(212 |
) |
Deferred
tax (benefit) |
(45 |
) |
(909 |
) |
(28 |
) |
(259 |
) |
(81 |
) |
Change in
working capital |
(553 |
) |
430 |
|
(1,713 |
) |
(1,232 |
) |
(1,869 |
) |
Other
operating activities (net) |
444 |
|
683 |
|
451 |
|
180 |
|
139 |
|
Net cash provided by operating activities (A) |
971 |
|
2,170 |
|
634 |
|
1,232 |
|
160 |
|
Investing activities: |
|
|
|
|
|
Purchase
of property, plant and equipment and intangibles (B) |
(947 |
) |
(1,156 |
) |
(781 |
) |
(616 |
) |
(752 |
) |
Other
investing activities (net) |
254 |
|
(770 |
) |
180 |
|
60 |
|
76 |
|
Net cash used in investing activities |
(693 |
) |
(1,926 |
) |
(601 |
) |
(556 |
) |
(676 |
) |
Financing activities: |
|
|
|
|
|
Net
(payments) / proceeds relating to payable to banks and long-term
debt |
(136 |
) |
(406 |
) |
(543 |
) |
474 |
|
263 |
|
Dividends
paid |
(46 |
) |
(32 |
) |
(37 |
) |
(101 |
) |
(50 |
) |
Share
buyback |
(90 |
) |
— |
|
— |
|
— |
|
(226 |
) |
Lease
principal payments and other financing activities (net) |
(72 |
) |
27 |
|
(17 |
) |
(21 |
) |
(20 |
) |
Net cash (used in) provided by financing
activities |
(344 |
) |
(411 |
) |
(597 |
) |
352 |
|
(33 |
) |
Net
(decrease) / increase in cash and cash equivalents |
(66 |
) |
(167 |
) |
(564 |
) |
1,028 |
|
(549 |
) |
Cash and
cash equivalents transferred to assets held for sale |
(11 |
) |
13 |
|
— |
— |
(23) |
|
— |
|
Effect of exchange rate changes on cash |
(15 |
) |
3 |
|
(56 |
) |
(104 |
) |
17 |
|
Change in cash and cash equivalents |
(92 |
) |
(151 |
) |
(620 |
) |
901 |
|
(532 |
) |
|
|
|
|
|
|
Free cash flow (C=A+B) |
24 |
|
1,014 |
|
(147 |
) |
616 |
|
(592 |
) |
Appendix 1: Product shipments by region
(000'kt) |
1Q 19 |
4Q 18 |
3Q 18 |
2Q 18 |
1Q 18 |
Flat |
4,750 |
|
4,406 |
|
4,885 |
|
5,011 |
|
4,811 |
|
Long |
721 |
|
890 |
|
774 |
|
969 |
|
921 |
|
NAFTA |
5,319 |
|
5,173 |
|
5,512 |
|
5,803 |
|
5,559 |
|
Flat |
1,699 |
|
1,832 |
|
1,695 |
|
1,494 |
|
1,400 |
|
Long |
1,194 |
|
1,232 |
|
1,415 |
|
1,345 |
|
1,095 |
|
Brazil |
2,880 |
|
3,053 |
|
3,097 |
|
2,831 |
|
2,483 |
|
Flat |
8,647 |
|
7,398 |
|
6,855 |
|
7,553 |
|
7,704 |
|
Long |
2,821 |
|
2,666 |
|
2,798 |
|
2,942 |
|
2,961 |
|
Europe |
11,553 |
|
10,098 |
|
9,709 |
|
10,516 |
|
10,697 |
|
CIS |
1,617 |
|
1,645 |
|
1,879 |
|
1,861 |
|
1,866 |
|
Africa |
1,049 |
|
1,023 |
|
1,102 |
|
1,199 |
|
1,167 |
|
ACIS |
2,662 |
|
2,669 |
|
2,986 |
|
3,057 |
|
3,029 |
|
Note: “Others and eliminations” are not presented in the
table
Appendix 2a: Capex
(USDm) |
1Q 19 |
4Q 18 |
3Q 18 |
2Q 18 |
1Q 18 |
NAFTA |
182 |
|
244 |
|
155 |
|
110 |
|
160 |
|
Brazil |
84 |
|
102 |
|
59 |
|
36 |
|
47 |
|
Europe |
353 |
|
499 |
|
298 |
|
226 |
|
313 |
|
ACIS |
137 |
|
159 |
|
141 |
|
117 |
|
117 |
|
Mining |
115 |
|
143 |
|
116 |
|
119 |
|
107 |
|
Total |
947 |
|
1,156 |
|
781 |
|
616 |
|
752 |
|
Note: “Others” are not presented in the table
Appendix 2b: Capex projects
The following tables summarize the Company’s principal growth
and optimization projects involving significant capex.
Completed projects in most recent
quarter
Segment |
Site
/ unit |
Project |
Capacity / details |
Actual completion |
NAFTA |
Indiana Harbor (US) |
Indiana Harbor “footprint optimization project” |
Restoration of 80” HSM and upgrades at Indiana Harbor
finishing |
4Q 2018 (a) |
Europe |
ArcelorMittal Differdange (Luxembourg) |
Modernisation of finishing of “Grey rolling mill" |
Revamp finishing to achieve full capacity of Grey mill at
850kt/y |
2Q 2018 |
Europe |
Gent & Liège (Europe Flat Automotive UHSS Program) |
Gent: Upgrade HSM and new furnace Liège: Annealing line
transformation |
Increase ~400kt in Ultra High Strength Steel capabilities |
2Q 2018 |
Ongoing projects
Segment |
Site / unit |
Project |
Capacity / details |
Forecasted completion |
ACIS |
ArcelorMittal Kryvyi
Rih (Ukraine) |
New LF&CC
2&3 |
Facilities
upgrade to switch from ingot to continuous caster route. Additional
billets of 290kt over ingot route through yield increase |
2019 |
Europe |
Sosnowiec (Poland) |
Modernization of Wire Rod Mill |
Upgrade rolling technology improving the mix of HAV products and
increase volume by 90kt |
2019 |
NAFTA |
Mexico |
New Hot strip mill |
Production capacity of 2.5Mt/year |
2020(b) |
NAFTA |
ArcelorMittal Dofasco (Canada) |
Hot Strip Mill Modernization |
Replace existing three end of life coilers with two states of the
art coilers and new runout tables |
2021(c) |
NAFTA |
Burns Harbor (US) |
New Walking Beam Furnaces |
Two new walking beam reheat furnaces bringing benefits on
productivity, quality and operational cost |
2021 |
Brazil |
ArcelorMittal Vega Do Sul |
Expansion project |
Increase hot dipped / cold rolled coil capacity and construction of
a new 700kt continuous annealing line (CAL) and continuous
galvanising line (CGL) combiline |
2021(d) |
Brazil |
Juiz de Fora |
Melt shop expansion |
Increase in meltshop capacity by 0.2Mt/year |
On hold(e) |
Brazil |
Monlevade |
Sinter plant, blast furnace and melt shop |
Increase in liquid steel capacity by 1.2Mt/year; Sinter feed
capacity of 2.3Mt/year |
On hold(e) |
Mining |
Liberia |
Phase 2 expansion project |
Increase production capacity to 15Mt/year |
Under review(f) |
a) In support of the Company’s Action 2020
program, the footprint optimization project at ArcelorMittal
Indiana Harbor is now complete, which has resulted in structural
changes required to improve asset and cost optimization. The plan
involved idling redundant operations including the #1 aluminize
line, 84” hot strip mill (HSM), and #5 continuous galvanizing line
(CGL) and No.2 steel shop (idled in 2Q 2017) whilst making further
planned investments totalling approximately $200 million including
a new caster at No.3 steel shop (completed in 4Q 2016), restoration
of the 80” hot strip mill and Indiana Harbor finishing. The full
project scope was completed in 4Q 2018.
b) On September 28, 2017, ArcelorMittal
announced a major US$1 billion, three-year investment programme at
its Mexican operations, which is focussed on building ArcelorMittal
Mexico’s downstream capabilities, sustaining the competitiveness of
its mining operations and modernising its existing asset base. The
programme is designed to enable ArcelorMittal Mexico to meet the
anticipated increased demand requirements from domestic customers,
realise in full ArcelorMittal Mexico’s production capacity of 5.3
million tonnes and significantly enhance the proportion of higher
added-value products in its product mix, in-line with the Company’s
Action 2020 plan. The main investment will be the construction of a
new hot strip mill. Upon completion, the project will enable
ArcelorMittal Mexico to produce c. 2.5 million tonnes of flat
rolled steel, long steel c. 1.8 million tonnes and the remainder
made up of semi-finished slabs. Coils from the new hot strip mill
will be supplied to domestic, non-auto, general industry customers.
The project commenced late 4Q 2017 and is expected to be completed
in the second quarter of 2020.
c) Investment in ArcelorMittal Dofasco
(Canada) to modernise the hot strip mill. The project is to install
two new state of the art coilers and runout tables to replace three
end of life coilers. The strip cooling system will be upgraded and
include innovative power cooling technology to improve product
capability. Engineering and equipment manufacturing is complete.
Construction activities for coiler are on track. Runout table
installation work originally scheduled for April 2019 will be
effectively carried out during April 2020 shut down due to
change in design and delay in manufacturing. The project is
expected to be completed in 2021.
d) In August 2018, ArcelorMittal announced the
resumption of the Vega Do Sul expansion to provide an additional
700kt of cold-rolled annealed and galvanised capacity to serve the
growing domestic market. The three-year ~$0.3 billion investment
programme to increase rolling capacity with construction of a new
continuous annealing line and CGL combiline (and the option to add
a ca. 100kt organic coating line to serve construction and
appliance segments), and upon completion, will strengthen
ArcelorMittal’s position in the fast growing automotive and
industry markets through Advanced High Strength Steel products. The
investments will look to facilitate a wide range of products and
applications whilst further optimizing current ArcelorMittal Vega
facilities to maximize site capacity and its competitiveness,
considering comprehensive digital and automation technology.
e) Although the Monlevade wire rod expansion
project and Juiz de Fora rebar expansion were completed in
2015, both projects are currently on hold and are expected to
be completed upon Brazil domestic market recovery.
f) ArcelorMittal had previously
announced a Phase 2 project that envisaged the construction of 15
million tonnes of concentrate sinter fines capacity and associated
infrastructure. The Phase 2 project was initially delayed due to
the declaration of force majeure by contractors in August 2014 due
to the Ebola virus outbreak in West Africa, and then reassessed
following rapid iron ore price declines over the ensuing period.
ArcelorMittal Liberia is now undertaking the engineering phase of a
feasibility study to identify the optimal concentration solution
for utilising the resources at Tokadeh. The feasibility study is
expected to be completed by mid-2019.
Appendix 3: Debt repayment schedule as of March 31,
2019
(USD billion) |
2019 |
2020 |
2021 |
2022 |
2023 |
>=2024 |
Total |
Bonds |
— |
|
1.8 |
|
1.3 |
|
1.5 |
|
0.6 |
|
3.3 |
|
8.5 |
|
Commercial paper |
1.5 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
1.5 |
|
Other loans |
1.1 |
|
0.5 |
|
0.6 |
|
0.3 |
|
0.3 |
|
0.6 |
|
3.4 |
|
Total gross debt |
2.6 |
|
2.3 |
|
1.9 |
|
1.8 |
|
0.9 |
|
3.9 |
|
13.4 |
|
Appendix 4: Reconciliation of gross debt to net
debt
(USD million) |
Mar 31, 2019 |
Dec 31, 2018 |
Mar 31, 2018 |
Gross
debt (excluding that held as part of the liabilities held for
sale) |
13,330 |
|
12,483 |
|
13,393 |
|
Gross debt held as part of the liabilities held for sale |
96 |
|
77 |
|
— |
|
Gross debt |
13,426 |
|
12,560 |
|
13,393 |
|
Less: |
|
|
|
Cash and cash equivalents |
(2,246 |
) |
(2,354 |
) |
(2,260 |
) |
Cash and cash equivalents held as part of the assets held for
sale |
(21 |
) |
(10 |
) |
— |
|
Net debt (including that held as part of the assets and the
liabilities held for sale) |
11,159 |
|
10,196 |
|
11,133 |
|
|
|
|
|
Net debt / EBITDA |
- |
1.0 |
|
- |
Appendix 5: Terms and definitions
Unless indicated otherwise, or the context otherwise requires,
references in this earnings release report to the following terms
have the meanings set out next to them below:
Apparent steel consumption: calculated as the
sum of production plus imports minus exports.Average steel
selling prices: calculated as steel sales divided by steel
shipments.Cash and cash equivalents: represents
cash and cash equivalents, restricted cash and short-term
investments.Capex: represents the purchase of
property, plant and equipment and intangibles.Crude steel
production: steel in the first solid state after melting,
suitable for further processing or for
sale.EBITDA: operating income plus depreciation,
impairment expenses and exceptional income/
(charges).EBITDA/tonne: calculated as EBITDA
divided by total steel shipments.Exceptional items (income
/ (charges)): relate to transactions that are significant,
infrequent or unusual and are not representative of the normal
course of business of the period.Foreign exchange and other
net financing (loss) / gain: include foreign currency
exchange impact, bank fees, interest on pensions, impairments of
financial assets, revaluation of derivative instruments and other
charges that cannot be directly linked to operating
results.Free cash flow (FCF): refers to net cash
provided by operating activities less capex.Gross
debt: long-term debt, plus short-term debt and IFRS 16
liabilities impact (including that held as part of the liabilities
held for sale).Liquidity: cash and cash
equivalents plus available credit lines excluding back-up lines for
the commercial paper program.LTIF: lost time
injury frequency rate equals lost time injuries per 1,000,000
worked hours, based on own personnel and
contractors.MT: refers to million metric
tonnesMarket-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.Mining segment
sales: i) “External sales”: mined product sold to third
parties at market price; ii) “Market-priced tonnes”: internal sales
of mined product to ArcelorMittal facilities and reported at
prevailing market prices; iii) “Cost-plus tonnes” - internal sales
of mined product to ArcelorMittal facilities on a cost-plus basis.
The determinant of whether internal sales are reported at market
price or cost-plus is whether the raw material could practically be
sold to third parties (i.e. there is a potential market for the
product and logistics exist to access that market).Net
debt: long-term debt, plus short-term debt and IFRS 16
liabilities impact less cash and cash equivalents (including those
held as part of assets and liabilities held for sale).Net
debt/LTM EBITDA: refers to Net debt divided by last twelve
months (LTM) EBITDA calculation.Net interest
expense: includes interest expense less interest
incomeOn-going projects: refer to projects for
which construction has begun (excluding various projects that are
under development), even if such projects have been placed on hold
pending improved operating conditions.Operating
results: refers to operating
income/(loss).Operating segments: NAFTA segment
includes the Flat, Long and Tubular operations of USA, Canada and
Mexico. The Brazil segment includes the Flat, Long and Tubular
operations of Brazil and its neighboring countries including
Argentina, Costa Rica and Venezuela. The Europe segment comprises
the Flat, Long and Tubular operations of the European business, as
well as Downstream Solutions. The ACIS segment includes the Flat,
Long and Tubular operations of Kazakhstan, Ukraine and South
Africa. Mining segment includes iron ore and coal
operations.Own iron ore production: includes total
of all finished production of fines, concentrate, pellets and lumps
and includes share of production (excludes strategic long-term
contracts).PMI: refers to purchasing managers
index (based on ArcelorMittal estimates)Seaborne iron ore
reference prices: refers to iron ore prices for 62% Fe CFR
ChinaShipments: information at segment and group
level eliminates intra-segment shipments (which are primarily
between Flat/Long plants and Tubular plants) and inter-segment
shipments respectively. Shipments of Downstream Solutions are
excluded.Steel-only EBITDA: calculated as Group
EBITDA less Mining segment EBITDA.Steel-only
EBITDA/tonne: calculated as steel-only EBITDA divided by
total steel shipments.Working capital change (working
capital investment / release): Movement of change in
working capital - trade accounts receivable plus inventories less
trade and other accounts payable.YoY: refers to
year-on-year.
Footnotes
- 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
also 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/alternative performance measures.
ArcelorMittal presents EBITDA, and EBITDA/tonne, which are non-GAAP
financial/alternative performance measures and calculated as shown
in the Condensed Consolidated Statement of Operations, as
additional measures 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 change in
working capital as additional measures to enhance the understanding
of its financial position, changes to its capital structure and its
credit assessment. ArcelorMittal also presents free cash flow
(FCF), which is a non-GAAP financial/alternative performance
measure calculated as shown 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. The Company also presents the ratio of net debt to EBITDA
for the twelve months ended December 31, 2018 which investors may
find useful in understanding the company's ability to service its
debt. Non-GAAP financial/alternative performance 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/alternative performance measures may not be
comparable to similarly titled measures applied by other
companies.
- Health and safety performance inclusive of ArcelorMittal Italia
and related facilities (“ArcelorMittal Italia”) (consolidated as
from November 1, 2018) was 1.14x for 1Q 2019 and 0.91 for 4Q 2018.
Health and safety figures excluding ArcelorMittal Italia were 0.66x
for 1Q 2019 as compared to 0.70x for 4Q 2018. Previously published
4Q 2018 health and safety performance figures for ArcelorMittal
(inclusive of ArcelorMittal Italia) and ArcelorMittal Italia have
not been shown in the table for comparative purposes. From 1Q 2019
onwards, the methodology and metrics used to calculate health and
safety figures for ArcelorMittal Italia have been harmonized with
those of ArcelorMittal.
- Impairment charges net of purchase gains for 4Q 2018 include
$0.4 billion impairment expenses for ArcelorMittal Italia remedies
and $0.2 billion purchase gains on the ArcelorMittal Italia
acquisition.
- On April 20, 2018, following the approval by the Brazilian
antitrust authority - CADE of the combination of ArcelorMittal
Brasil’s and Votorantim’s long steel businesses in Brazil subject
to the fulfilment of divestment commitments, ArcelorMittal Brasil
agreed to dispose of its two production sites of Cariacica and
Itaúna, as well as some wire drawing equipment of ArcelorMittal
Brasil and ArcelorMittal Sul-Fluminense. The sale was completed
early May 2018 to the Mexican Group Simec S.A.B. de CV. A second
package of some wire drawing equipment of ArcelorMittal Brasil and
ArcelorMittal Sul-Fluminense was sold to the company Aço Verde do
Brasil as part of CADE's conditional approval.
- In July 2018, as a result of a settlement process, the Company
and the German Federal Cartel Office agreed to a €118 million ($146
million) fine to be paid by ArcelorMittal Commercial Long
Deutschland GmbH ending an investigation that began in the first
half of 2016 into antitrust violations concerning the ArcelorMittal
entities that were under investigation. The payment was made in
August 2018.
- Following the May 16, 2018 approval of the Extraordinary
General Meeting to convert the share capital of the ArcelorMittal
parent company from Euro to US dollar, the Euro denominated tax
losses and the related deferred tax asset (DTA) held by the
ArcelorMittal parent company were translated into US dollars. The
Company designated its euro denominated debt as a hedge of certain
euro denominated net investments in foreign operations. Following
this change, periodic revaluations of such external
euro-denominated debt are recorded in other comprehensive income
rather than the statement of operations. The conversion of the euro
denominated DTA was effective as of January 1, 2018, whilst
the impacts on euro denominated debt has been applied prospectively
from April 1, 2018. As a result, the Company’s statement of
operations no longer has foreign exchange exposure to euro
denominated debt and DTA.
- ArcelorMittal Mines Canada, otherwise known as ArcelorMittal
Mines and Infrastructure Canada.
- On December 19, 2018, ArcelorMittal signed a $5,500,000,000
Revolving Credit Facility, with a five-year maturity plus two
one-year extension options (i.e. the options to extend are in the
first and second years, so at end 2019 and at end 2020). The
facility will replace the $5,500,000,000 revolving credit facility
agreement signed April 30, 2015 and amended December 21, 2016, and
will be used for the general corporate purposes of the
ArcelorMittal group. The facility gives ArcelorMittal considerably
improved terms over the former facility, and extends the average
maturity date by approximately three years. As of March 31, 2019,
the $5.5 billion revolving credit facility was fully
available.
- Assets and liabilities held for sale, as of March 31, 2019 and
December 31, 2018, include the ArcelorMittal Italia remedy package
assets (as previously disclosed in the 1Q 2018 earnings release),
and carrying value of the USA long product facilities at Steelton
(“Steelton”). Assets and liabilities held for sale, as of March 31,
2018, primarily include the carrying value of the USA long product
facilities at Steelton, and Cariacica and Itauna industrial plants
in Brazil (sold in May 2018 as remedy package for Votorantim
acquisition).
- The PIS (Program of Social Integration) and COFINS
(Contribution for the Financing of Social Security) are Brazilian
federal taxes based on the turnover of companies. The PIS is
intended to finance the unemployment insurance system, and COFINS
to fund Social Security. For over two decades, ArcelorMittal Brasil
has been challenging the basis of the calculation of the COFINS and
PIS, specifically, whether Brazilian ICMS (tax on sales and
services) may be deducted from the base amount on which PIS
and COFINS taxes are calculated. Following the Supreme Court’s
decision in the leading case and certain lower court decisions
applying it, the Court issued final and unappealable judgments in
certain of the cases filed by ArcelorMittal Brasil, thereby
granting ArcelorMittal Brasil the right to exclude ICMS from the
PIS/COFINS’ tax base and the right to recognize the relevant
credits from the past. Accordingly, ArcelorMittal Brasil recognized
$202 million additional PIS/COFINS credits in 4Q 2018 for the
period of 2005 to 2013 and is awaiting the Court’s final judgment
on other pending cases related to the PIS/COFINS topic.
- Dividends are announced in US dollars. Dividends are paid in US
dollars for shares traded in the United States in the form of New
York registry shares. Dividends are paid in EUR for shares listed
on the European Stock Exchanges (Amsterdam, Paris, Luxembourg, MTS)
and converted from US dollars to EUR based on the European Central
Bank exchange rate at May 16, 2019. A Luxembourg withholding tax of
15% is applied on the gross dividend amounts. Dividend record date
is May 17, 2019 and payment date June 13, 2019.
- ArcelorMittal has applied IFRS 16 Leases as of January 1, 2019.
Due to the transition option selected, the prior-period data has
not been restated. IFRS 16 Leases provides a single lessee
accounting model requiring lessees to recognize right-of-use assets
and lease liabilities for all non-cancellable leases except for
short-term leases and low value assets. The right-of-use assets are
recognized as property, plant and equipment and measured on January
1, 2019 at an amount equal to the lease liability recognized as
debt (short term $0.3 billion and long term $0.9 billion impact as
of January 1, 2019) and measured on the basis of the net present
value of remaining lease payments. Net debt increased accordingly
by $1.2 billion in 1Q 2019. The recognition of the lease expense in
EBITDA for leases previously accounted for as operating leases is
replaced by a depreciation expense related to the right-of-use
assets and an interest expense reflecting the amortization of the
lease liability. IFRS 16 contributed to a positive EBITDA impact of
$56 million (majority in segment others) in 1Q 2019. In addition,
cash payments relating to the repayment of the principal amount of
the lease liability are presented in the consolidated statements of
cash flows as outflows from financing activities while lease
payments for operating leases were previously recognized as
outflows from operating activities.
First quarter 2019 earnings analyst conference
call
ArcelorMittal will hold a conference call hosted
by Heads of Finance and Investor Relations for members of the
investment community to discuss the three-month period ended March
31, 2019 on: Thursday May 9, 2019 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 |
48013763# |
US local: |
1 86 6719 2729 |
+1 24 0645 0345 |
48013763# |
US (New York): |
1 86 6719 2729 |
+ 1 646 663 7901 |
48013763# |
France: |
0800 914780 |
+33 1 7071 2916 |
48013763# |
Germany: |
0800 965 6288 |
+49 692 7134 0801 |
48013763# |
Spain: |
90 099 4930 |
+34 911 143436 |
48013763# |
Luxembourg: |
800 26908 |
+352 27 86 05 07 |
48013763# |
A
replay of the conference call will be available for one week by
dialing: +49 (0) 1805 2047 088; Access code 2523725# |
Forward-Looking StatementsThis 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.
About ArcelorMittalArcelorMittal is the world's
leading steel and mining company, with a presence in 60 countries
and an industrial footprint in 18 countries. Guided by a philosophy
to produce safe, sustainable steel, we are the leading supplier of
quality steel in the major global steel markets including
automotive, construction, household appliances and packaging, with
world-class research and development and outstanding distribution
networks.
Through our core values of sustainability, quality and
leadership, we operate responsibly with respect to the health,
safety and wellbeing of our employees, contractors and the
communities in which we operate. For us, steel is the fabric of
life, as it is at the heart of the modern world from railways to
cars and washing machines. We are actively researching and
producing steel-based technologies and solutions that make many of
the products and components people use in their everyday lives more
energy efficient.
We are one of the world’s five largest producers of iron ore and
metallurgical coal. With a geographically diversified portfolio of
iron ore and coal assets, we are strategically positioned to serve
our network of steel plants and the external global market. While
our steel operations are important customers, our supply to the
external market is increasing as we grow. In 2018, ArcelorMittal
had revenues of $76.0 billion and crude steel production of 92.5
million metric tonnes, while own iron ore production reached 58.5
million metric tonnes.
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/
EnquiriesArcelorMittal investor relations:
Europe: +44 207 543 1128; Americas: +1 312 899 3985; Retail: +44
207 543 1156; SRI: +44 207 543 1156 and Bonds/credit: +33 1 71 92
10 26.
ArcelorMittal corporate communications (E-mail:
press@arcelormittal.com) +44 0207 629 7988. Contact: Paul Weigh +44
203 214 2419
Attachment
- ArcelorMittal reports first quarter 2019 results
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