ArcelorMittal cuts dividend after slipping to quarterly loss

KOLKATA: ArcelorMittal, the world's largest steel company, posted a net loss of $709 million in the third quarter of 2012, with the slowdown in China compounding the problems being faced by the company in an already weak global steel market.

The company reported steel shipments of 19.9 million tonne in Q3 of 2012, a decrease of 8.3 per cent as compared to Q2 of 2012 and 5.7 per cent lower compared to Q3 of 2011. Total steel shipments for nine month period ending September 2012 were lower at 63.8 million tonnes as compared with 65.2 million tonnes for same period last year.

Sales for the nine month period in 2012 decreased by 9.3 per cent to $64.9 billion as compared with $71.5 billion for the same period in 2011, primarily due to lower average steel selling prices (-8.1 per cent) and lower steel shipments (-2.2 per cent). Operating income for nine months ending September 2012 was $1.7 billion, compared with operating income of $4.9 billion in same period of 2011.

Lakshmi N. Mittal, chairman and CEO of ArcelorMittal said: "The already fragile global economy was further impacted in the third quarter of 2012 by the slowdown in China. This resulted in very challenging operating conditions for ArcelorMittal, which are expected to continue in the fourth quarter. Against this backdrop, the company is focussed on delivering its plan of asset optimization, net debt reduction and productivity and efficiency improvements."



In terms of outlook, ArcelorMittal said, "the Q3 2012 fall in the iron ore price, and the weaker global economic backdrop, adversely impacted steel prices and steel volumes as well as the profitability of our mining operations, affecting our previous expectations for group profitability in (second half) 2H 2012. The company now expects FY 2012 EBITDA of approximately $7 billion."