ArcelorMittal steels quarterly profit by 19% to $1.32 billion
The world's largest steelmaker ArcelorMittal on Thursday reported 18.91 per cent rise in net profit at $1.32 billion for the April-June quarter on the back of higher sales.
The firm, led by billionaire Lakshmi N Mittal, had posted a net profit of $1.11 billion in the year-ago period.
Sales of the steel giant rose 16.96 per cent to $17.24 billion in April-June from $14.74 billion in the corresponding period last year.
ArcelorMittal follows January-December fiscal year.
"Net debt decreased to $11.9 billion as of June 30, 2017, as compared to $12.1 billion as of March 31, 2017 due to positive free cash flow ($0.6 billion) (despite investment in working capital) offset in part by foreign exchange losses ($0.4 billion)," the company said in a statement.
ArcelorMittal Chairman and CEO Lakshmi Mittal said: "We have materially improved our financial performance in the first half of 2017, and continue to make important progress on our Action 2020 plan."
He said the recently announced acquisition of Ilva represents a unique opportunity to create value for company shareholders.
ArcelorMittal said it will leverage its strengths to realise Ilva's potential as a Tier 1 supplier to European and Italian steel customers.
"Looking ahead demand remains strong in our core markets supporting robust order books and healthy levels of steel spreads. However, it remains a matter of concern that we are not able to capture the full benefits of this demand growth due to continued high levels of imports. We continue to work towards achieving a comprehensive trade solution in response to unfair imports," Mittal said. ArcelorMittal also reported steel shipments of 21.5 million tonne in April-June 2017.
Iron ore shipments in April-June stood at 9.5 MT, almost at the same level of last year, while crude steel production too stood at 23.2 MT almost at the same level as in the corresponding period last year.
On outlook, the firm said: "current market conditions are improved compared to twelve months ago with steel spreads currently at healthy levels. The demand environment is positive...which suggests that steel shipments in 2H 2017 will be higher than would normally be suggested by seasonality alone."
The company now expects that the cash needs of the business in 2017 to be approximately $4.6 billion (as compared to $5.0 billion previous guidance). Given the liability management exercise and lower average debt, we now expect interest expense to decline to $0.8 billion in 2017.