7:10 | 07.02.2012
Business Wire News: ArcelorMittal Reports Fourth Quarter 2011 and Full Year 2011 Results
Business Wire Pressemitteilung via mecom Mediensatellit /
Schlagwort(e): Sonderthemen
Business Wire News: ArcelorMittal Reports Fourth Quarter 2011 and Full
Year 2011 Results
07.02.2012 / 07:10
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MITTEILUNG UEBERMITTELT VON BUSINESS WIRE. FUER DEN INHALT IST ALLEIN
DAS BERICHTENDE UNTERNEHMEN VERANTWORTLICH.
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LUXEMBOURG –(BUSINESS WIRE)–07.02.2012–
Regulatory News:
ArcelorMittal (referred to as ‘ArcelorMittal’ or the ‘Company’) (MT (New York,
Amsterdam, Paris, Luxembourg), MTS (Madrid)), the world’s leading steel
company, today announced results^1 for the three and twelve month periods ended
December 31, 2011.
Highlights:
* Health and safety performance improved in 2011 with an annual LTIF rate^2
of 1.4x as compared to 1.8x in 2010; marked improvement shown in 4Q 2011
with an LTIF rate of 1.2x
* FY 2011 EBITDA^3 of $10.1 billion (+18.7% y-o-y); 4Q 2011 EBITDA of $1.7
billion (including positive $0.1 billion from sale of CO[2] credits) in
challenging market conditions
* FY 2011 net income of $2.3 billion or $1.46 per share; 4Q 2011 net loss of
$1.0 billion due in part to $1.3 billion of non-cash charges (reduction of
deferred tax assets ($0.9 billion), together with asset impairments ($0.2
billion) and restructuring charges associated with asset optimization ($0.2
billion))
* 4Q 2011 steel shipments of 20.6Mt down 2.5% vs. 3Q 2011 driven mainly by
destocking in Europe
* Mining production targets achieved: FY 2011 iron ore production of 54.1Mt
(+10.5% y-o-y), of which 28.0Mt shipped at market prices^4 (+11.5% y-o-y);
FY 2011 coal production of 8.3Mt (+ 20% y-o-y), of which 4.9Mt shipped at
market prices (+45% y-o-y)
* Net debt^5 reduced by $2.4 billion during 4Q 2011 to $22.5 billion as of
December 31, driven by improved cash flow from operations of $2.9 billion,
inflow of $0.8 billion from MacArthur Coal divestment and foreign exchange
gains
* The Board proposes to maintain the annual dividend at $0.75 per share,
subject to AGM approval
Outlook and guidance:
* 1H 2012 EBITDA likely to be lower than the comparable period of 2011 and
above 2H 2011 level; supported by continued progress on management gains
and asset optimization plans
* Overall steel shipment volumes in 1H 2012 are expected to be at a similar
level as in 1H 2011; Mining production volumes expected to be higher than
1H 2011 in line with plans to increase own iron ore and coal production in
FY 2012 by approximately 10%
* 2012 Capex expected to be approximately $4-4.5 billion
* Further reduction in net debt anticipated with a focus on working capital
management and non-core asset divestments, per the Company’s stated
objective to retain its investment grade credit rating
Financial highlights (on the basis of IFRS^1, amounts in USD):
Quarterly comparison Semi-annual comparison Annual comparison
(USDm)
unless 4Q 11 3Q 11 4Q 10 2H 11 1H 11 2H 10 12M 11 12M 10
otherwise
shown
Sales $22,449 $24,214 $20,699 $46,663 $47,310 $40,443 $93,973 $78,025
EBITDA 1,714 2,408 1,853 4,122 5,995 4,015 10,117 8,525
Operating 47 1,168 397 1,215 3,683 1,425 4,898 3,605
income
Net income (1,000) 659 (780) (341) 2,604 570 2,262 2,916
/ (loss)
Basic
earnings /
(loss) per (0.65) 0.43 (0.51) (0.22) 1.68 0.38 1.46 1.93
share
(USD)
Continuing
operations
Own iron
ore 15.1 14.1 12.6 29.2 24.9 25.6 54.1 48.9
production
(Mt)
Iron ore
shipped
internally
and
externally
at market 8.5 6.7 6.7 15.1 12.9 12.8 28.0 25.2
price (Mt)
^4
Crude
steel 21.7 22.4 21.6 44.0 47.9 43.8 91.9 90.6
production
(Mt)
Steel
shipments 20.6 21.1 21.1 41.7 44.1 41.7 85.8 85.0
(Mt)
EBITDA/
tonne (US$ 83 114 88 99 136 96 118 100
/t)
Commenting, Mr. Lakshmi N. Mittal, Chairman and CEO, ArcelorMittal, said:
‘The progressive recovery that we have been experiencing was impacted in the
second half of the year by the growing uncertainty over the economic situation
in Europe, which particularly affected sentiment and performance in the fourth
quarter. Nevertheless, against this backdrop ArcelorMittal delivered an
improved underlying performance compared with 2010 and met our expectation of a
higher EBITDA in the second half compared with the previous year. The Company
continues to benefit from its diverse geographic presence and growing mining
business, which delivered on its targets to increase iron-ore and coal
production by 10% and 20% respectively. I must also remark on our health and
safety performance, which showed an improvement in the injury frequency rate to
1.2x in the fourth quarter.
Looking ahead to 2012, the situation in Europe remains a live concern. Despite
the continued uncertainty in this market, however, we are seeing an improvement
in sentiment compared with the fourth quarter. Steel shipment volumes for the
first six months are expected to be similar to the first half of 2011 and we
are again targeting increased production from our mining business.’
FOURTH QUARTER 2011 EARNINGS ANALYST CONFERENCE CALL
Additionally, ArcelorMittal management will host a conference call for members
of the investment community to discuss the fourth quarter 2011 financial
performance at:
Date New York London Luxembourg
Tuesday February 7, 9.30am 2.30pm 3.30pm
2012
The dial in numbers:
Location Dial in numbers Replay numbers Participant
UK local: +44 (0)207 970 +44 (0)20 7111 696578#
0006 1244
UK toll free 0800 169 3059 696578#
USA local: +1 215 599 1757 +1 347 366 9565 696578#
USA free phone: 1800 814 6417 696578#
A replay of the conference call will be available for one week by dialing
Language English
+49 (0) 1805 2043 089 Access code 421168#
The conference call will include a brief question and answer session with
senior management. The presentation will be available via a live video webcast
on www.arcelormittal.com.
Forward-Looking Statements
This 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 Annual Report on Form 20-F for the
year ended December 31, 2011 to be filed 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 ArcelorMittal
ArcelorMittal is the world’s leading steel company, with presence in more than
60 countries.
ArcelorMittal is the leader in all major global steel markets, including
automotive, construction, household appliances and packaging, with leading R&D
and technology, as well as sizeable captive supplies of raw materials and
outstanding distribution networks. With an industrial presence in over 20
countries spanning four continents, the Company covers all of the key steel
markets, from emerging to mature.
Through its core values of sustainability, quality and leadership,
ArcelorMittal commits to operating in a responsible way with respect to the
health, safety and well-being of its employees, contractors and the communities
in which it operates. It is also committed to the sustainable management of the
environment. It takes a leading role in the industry’s efforts to develop
breakthrough steelmaking technologies and is actively researching and
developing steel-based technologies and solutions that contribute to combat
climate change.
In 2011, ArcelorMittal had revenues of $94 billion and crude steel production
of 91.9 million tonnes, representing approximately 6 percent of world steel
output.
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 visit: www.arcelormittal.com.
ArcelorMittal fourth quarter 2011 results and full year 2011 results
ArcelorMittal, the world’s leading steel company, today announced results for
the three and twelve month periods ended December 31, 2011.
Corporate social responsibility and safety performance
Health and safety – Own personnel and contractors lost time injury frequency
rate^2
Health and safety performance, based on own personnel figures and contractors
lost time injury frequency rate, improved to 1.4x for the year 2011 from 1.8x
for the year 2010 with significant improvement in Mining operations, Flat
Carbon Europe, Long Carbon Americas and Europe and Asia Africa and CIS
operations only partially offset by deterioration in the Flat Carbon Americas
and the Distribution Solutions segments. Safety performance improved to 1.2x in
the fourth quarter of 2011 as compared to 1.5x in the third quarter of 2011,
with improvements in the safety performance of all our operating segments with
the exception of Flat Carbon Americas.
Own personnel and contractors – Frequency Rate
Lost time injury frequency rate 4Q 11 3Q 11 4Q 10 12M 11 12M 10
Total Mines 0.5 1.2 1.1 1.2 1.5
Lost time injury frequency rate 4Q 11 3Q 11 4Q 10 12M 11 12M 10
Flat Carbon Americas 1.9 1.7 2.0 1.9 1.8
Flat Carbon Europe 1.5 1.6 2.3 1.6 2.3
Long Carbon Americas and Europe 1.1 1.7 1.7 1.4 2.0
Asia Africa and CIS 0.6 0.9 0.9 0.7 0.9
Distribution Solutions 2.2 4.4 2.8 3.2 2.7
Total Steel 1.3 1.6 1.7 1.5 1.8
Lost time injury frequency rate 4Q 11 3Q 11 4Q 10 12M 11 12M 10
Total (Steel and Mines) 1.2 1.5 1.6 1.4 1.8
Key corporate social responsibility highlights for the three months ended
December 31, 2011
* ArcelorMittal was recently named in global human resources firm Aon
Hewitt’s list of top companies for leaders and ranked in the top seven
companies in Europe. Winners were chosen by an expert panel of independent
judges based on criteria including strength of leadership practices and
culture; examples of leader development on a global scale; alignment of
business and leadership strategy and business performance and company
reputation.
* On December 2, 2011 ArcelorMittal celebrated its 4th annual International
Volunteer Work Day. Within the programme, thousands of ArcelorMittal
employees volunteer in different activities that are carried out to improve
the lives of the people in the community.
* On October 13, 2011, ArcelorMittal was given the ‘Life Cycle Assessment
Leadership’ award by The Worldsteel Association, which recognizes the
quality of the work performed by the life cycle analysis (LCA) team of
global research and development, based in Maizieres. It also supports the
way in which ArcelorMittal uses LCA to develop new steel solutions, new
steel grades and new production processes and to position them on the
market.
Analysis of results for the twelve months ended December 31, 2011 versus
results for the twelve months ended December 31, 2010
ArcelorMittal’s net income for the twelve months ended December 31, 2011 was
$2.3 billion, or $1.46 per share, as compared to net income for the twelve
months ended December 31, 2010 of $2.9 billion, or $1.93 per share.
Total steel shipments for the twelve months ended December 31, 2011 increased
by 0.9% to 85.8 million metric tonnes as compared with 85.0 million metric
tonnes for the twelve months ended December 31, 2010.
Sales for the twelve months ended December 31, 2011 increased 20.4% to $94.0
billion as compared with $78.0 billion for the twelve months ended December 31,
2010 primarily due to higher average steel selling prices (+17.7%) and
marginally higher steel shipments (+0.9%).
Depreciation for the twelve months ended December 31, 2011 was higher at $4.7
billion as compared with depreciation of $4.4 billion for the twelve months
ended December 31, 2010.
Impairment charges for the twelve months ended December 31, 2011 were $331
million, including $151 million related to the extended idling of the Madrid
electric arc furnace (Long Carbon Europe) and $141 million related to assets
within the Flat Carbon Europe perimeter (including $85 million relating to
Liege, Belgium) This is compared to impairment charges of $525 million for the
twelve months ended December 31, 2010, including $305 million relating to the
Company’s coal mines in Russia (including the disposal of the Anzherskaya
mine), $113 million relating to the Distribution Solutions segment and $107
million primarily relating to idle downstream assets in the European business.
Restructuring charges for the twelve months ended December 31, 2011 totalled
$219 million and consisted of costs associated with the implementation of the
Asset Optimisation Plan primarily impacting Flat Carbon Europe and Long Carbon
Europe operations, as well as various Distribution Solution entities. There
were no such restructuring charges in the twelve months ended December 31,
2010.
Operating income for the twelve months ended December 31, 2011 was $4.9
billion, compared with operating income of $3.6 billion for the twelve months
ended December 31, 2010.
Operating performance for the twelve months ended December 31, 2011 was
positively impacted by $600 million of dynamic delta hedge (’DDH’) income^6
recognised during the year, a net gain of $93 million recorded on the sale of
carbon dioxide credits, the proceeds of which will be re-invested in energy
saving projects, and by $104 million related to reversal of provisions for
litigation. Operating performance for the twelve months ended December 31, 2010
was positively impacted by DDH income of $354 million and a net gain of $140
million recorded on the sale of carbon dioxide credits.
Income from equity method investments and other income for the twelve months
ended December 31, 2011 was $620 million, as compared to $451 million for the
twelve months ended December 31, 2010. Income for the twelve months ended
December 31, 2011 included an impairment charge of $107 million as a result of
the Company’s withdrawal from the joint venture with Peabody Energy to acquire
ownership of Macarthur Coal.^7 This charge reflects a higher carrying value of
the investment in Macarthur, which included accrued share of net income. After
considering dividends received and changes in exchange rate through October 25,
2011 (date of the divestiture announcement) the transaction was essentially
cash neutral.
Net interest expense (including interest expense and interest income) for the
twelve months ended December 31, 2011 was higher at $1.8 billion, as compared
to $1.4 billion for the twelve months ended December 31, 2010, primarily due to
the higher level of borrowing and the higher cost of bond financing compared to
bank loans.
Mark-to-market gains on the mandatorily convertible bond issued in December
2009 were $42 million in the twelve months ended December 31, 2011. During the
twelve months ended December 31, 2010, the Company had recorded a non-cash gain
of $427 million as a result of mark-to-market adjustments with respect to
embedded derivatives in its convertible bonds issued in the Spring of 2009. As
a result of hedging transactions undertaken by the Company in December 2010,
the mark-to-market impact from the convertible bonds issued in the Spring of
2009 has been minimized^8.
Foreign exchange and other net financing costs^9 were $1.1 billion for the
twelve months ended December 31, 2011, as compared to $1.2 billion for the
twelve months ended December 31, 2010.
ArcelorMittal recorded an income tax expense of $882 million for the twelve
months ended December 31, 2011, as compared to an income tax benefit of $1.5
billion for the twelve months ended December 31, 2010. The full year 2011
income tax expense of $882 million increased primarily due to lower recognition
of deferred taxes following improved results, dividend upstreaming in the
fourth quarter preventing interest deductibility in Luxembourg, partial
reversal of deferred taxes in our Belgian operations triggered by changes in
local tax legislation, and reversal of deferred tax assets in Spain imposed by
time limitations for compensation of tax losses.
Losses attributable to non-controlling interests for the twelve months ended
December 31, 2011 was $4 million as compared with gain attributable to
non-controlling interests for the twelve months ended December 31, 2010 of $89
million.
Discontinued operations (i.e. the Company’s stainless steel operations, which
were spun-off into a separate company, Aperam) in the twelve months ended on
December 31, 2011 amounted to a gain of $461 million, including $42 million of
the post-tax net results contributed by the stainless steel operations prior to
their spin-off. The balance of $419 million represents a one-time non-cash gain
from the recognition through the income statement of gains/losses relating to
the demerged assets previously held in equity. Discontinued operations for the
twelve months ended on December 31, 2010 amounted to a loss of $330 million.
Analysis of results for the three months ended December 31, 2011 versus the
three months ended September 30, 2011 and the three months ended December 31,
2010
ArcelorMittal recorded a net loss for the three months ended December 31, 2011
of $1.0 billion, or $0.65 loss per share, as compared with net income of $0.7
billion, or $0.43 per share, for the three months ended September 30, 2011, and
a net loss of $0.8 billion,^ or $0.51 loss per share, for the three months
ended December 31, 2010.
Total steel shipments for the three months ended December 31, 2011 were 20.6
million metric tonnes as compared with 21.1 million metric tonnes for the three
months ended September 30, 2011 and December 31, 2010, respectively.
Sales for the three months ended December 31, 2011 decreased by 7.3% to $22.4
billion as compared with $24.2 billion for the three months ended September 30,
2011, and were up 8.5% as compared with $20.7 billion for the three months
ended December 31, 2010. Sales were lower during the fourth quarter of 2011 as
compared to the third quarter of 2011 primarily due to lower average steel
selling prices (-6.2%) and lower steel shipment volumes (-2.5%).
Depreciation amounted to $1.2 billion for the three months ended December 31,
2011, flat compared to the three months ended September 30, 2011 and slightly
higher than depreciation of $1.1 billion for the three months ended December
31, 2010.
Impairment charges for the three months ended December 31, 2011 totaled $228
million, including $151 million related to the extended idling of the Madrid
electric arc furnace (Long Carbon Europe) and $56 million relating to assets
within the Flat Carbon Europe perimeter. Impairment charges for the three
months ended September 30, 2011 totaled $85 million relating to costs
associated with the announced intention to close two blast furnaces, sinter
plant, steel shop and continuous casters in Liege, Belgium. Impairment charges
for the three months ended December 31, 2010 totaled $381 million, and included
$186 million relating to the Company’s coal mines in Russia, $113 million
relating to certain subsidiaries in the Distribution Solutions segment
(primarily reflecting construction market weakness at that time) and $82
million primarily relating to idle downstream assets in the European business.
Restructuring charges for the three months ended December 31, 2011 totalled
$219 million and consisted of costs associated with the implementation of the
Asset Optimisation Plan primarily impacting Flat Carbon Europe and Long Carbon
Europe operations, as well as various Distribution Solution entities. There
were no such restructuring charges for the three months ended September 30,
2011 or December 31, 2010.
Operating income for the three months ended December 31, 2011 was $47 million,
as compared with operating income of $1.2 billion for the three months ended
September 30, 2011 and operating income of $0.4 billion for the three months
ended December 31, 2010. The drop in operating income resulted from the weaker
market environment particularly in Europe, with lower steel selling prices in
general for the quarter, as well as impairment and restructuring charges.
Operating performance for the three months ended December 31, 2011 was
positively impacted by $163 million of dynamic delta hedge (DDH) income
recognised during the quarter and by a net gain of $93 million recorded on the
sale of carbon dioxide credits, the proceeds of which will be re-invested in
energy saving projects. Operating performance for the three months ended
September 30, 2011 was positively impacted by $129 million of DDH income.
Operating performance for the three months ended December 31, 2010 was
positively impacted by a net gain of $140 million recorded on the sale of
carbon dioxide credits and the recognition of $88 million of DDH income.
Income from equity method investments and other income for the three months
ended December 31, 2011 was $177 million, as compared to $6 million for the
three months ended September 30, 2011 and $74 million for the three months
ended December 31, 2010. Income for the three months ended September 30, 2011
included a charge of $119 million as a result of the impairment of the
Company’s investment in Macarthur Coal^7. The charge reflected a higher
carrying value of the investment in Macarthur Coal, which included accrued
share of net income. After considering dividends received and changes in
exchange rate through October 25, 2011 (date of the divestiture announcement)
the transaction was essentially cash neutral.
Net interest expense (including interest expense and interest income) declined
to $429 million for the three months ended December 31, 2011 from $477 million
for the three months ended September 30, 2011. Net interest expense for the
three months ended December 31, 2010 was $413 million.
Mark-to-market loss on the mandatorily convertible bond issued in December 2009
during the fourth quarter of 2011 were $13 million compared to mark-to-market
gain of $59 million for the third quarter of 2011. During the three months
ended December 31, 2010, the Company had recorded a non-cash loss of $293
million as a result of mark-to-market adjustments relating to its convertible
bonds issued in the Spring of 2009; no mark-to-market gains or losses were
recorded in 2011 in respect of such bonds due to hedging transactions entered
into in December 2010.
Foreign exchange and other net financing gains were $26 million for the three
months ended December 31, 2011 and September 30, 2011. Foreign exchange and
other net financing losses for the three months ended December 31, 2010 were
$494 million.
ArcelorMittal recorded an income tax expense of $833 million for the three
months ended December 31, 2011, as compared to an income tax expense of $154
million for the three months ended September 30, 2011, and an income tax
benefit of $450 million for the three months ended December 31, 2010. The
fourth quarter 2011 income tax expense of $833 million increased primarily due
to lower recognition of deferred taxes following dividend upstreaming in the
fourth quarter preventing interest deductibility in Luxembourg, partial
reversal of deferred taxes in our Belgian operations triggered by changes in
local tax legislation, and reversal of deferred tax assets in Spain imposed by
time limitations for compensation of tax losses.
Losses attributable to non-controlling interests for the three months ended
December 31, 2011 was $25 million as compared with losses attributable to
non-controlling interests of $31 million and $46 million for the three months
ended September 30, 2011 and December 31, 2010, respectively.
Capital expenditure projects
The following tables summarize the Company’s principal growth and optimization
projects involving significant capital expenditures.
Completed Projects in Most Recent 4 Quarters
Segment Site Project Capacity / particulars Actual
Completion
Mining Princeton Underground Capacity increase by 1Q 11
Coal (USA) mine expansion 0.7mt / year
Mining Liberia Greenfield Iron ore production of 3Q 11^(a)
mines Liberia 4mt / year (Phase 1)
Ongoing^ (b) Projects
Segment Site Project Capacity / Forecasted
particulars Completion
Andrade Mines Andrade Increase iron ore
Mining (Brazil) expansion production to 3.5mt / 2012
year
ArcelorMittal Replacement of Increase iron ore
Mining Mines Canada spirals for production by 0.8mt / 2013
enrichment year
ArcelorMittal Expansion Increase concentrator
Mining Mines Canada Project capacity by 8mt/year 2013
(16 to 24mt/y)
ArcelorMittal Optimization of Optimize cost and
FCA Dofasco galvanizing and increase galvalume On hold
(Canada) galvalume production by 0.1mt /
operations year
ArcelorMittal Increase HDG capacity
FCA Vega Do Sul Expansion by 0.6mt / year and On hold
(Brazil) Project CR capacity by 0.7mt
/ year
Monlevade Wire rod Increase in capacity
LCA (Brazil) production of finished products On hold
expansion by 1.15mt / year
a) Iron ore mining production commenced in 2011 with 1 million tonnes produced.
The targeted iron ore production in 2012 is 4 million tonnes. As previously
announced, the Company is considering a Phase 2 expansion that would lead to
annual production of 15 million tonnes by 2015. This would require substantial
investment in a concentrator, the approval process of which remains in the
final stages.
b) Ongoing projects refer to projects for which construction has begun
(excluding various projects that are under development), or have been placed on
hold pending improved operating conditions.
Analysis of segment operations
As from January 1, 2011 the Company’s mining operations are reported as a
separate operating segment. This change in segmentation reflects the changes in
ArcelorMittal’s approach to managing its mining operations, i.e. a dedicated
mining management team. Accordingly, as required by IFRS, prior periods have
been recast to reflect this new segmentation.
All raw materials consumed from ArcelorMittal mines that could practically be
sold outside the Company are now reported at market prices. Production from
‘captive’ mines (limited by
logistics or quality) continues to be reported at
cost-plus to the steel facilities. The principal impact of this change has been
to increase the costs of raw materials consumed by the FCA and AACIS segments.
Flat Carbon Americas
(USDm) unless otherwise shown 4Q 11 3Q 11 4Q 10 12M 11 12M 10
Sales $5,030 $5,499 $4,573 $21,035 $17,684
EBITDA 237 420 158 2,109 1,555
Operating Income / (Loss) 1 193 (67) 1,198 691
Crude Steel Production (’000t) 6,009 5,866 5,636 24,215 23,101
Steel Shipments (’000t) 5,458 5,708 5,432 22,249 21,028
Average Steel Selling Price (US$ 868 910 769 892 781
/t)
EBITDA/tonne (US$/t) 43 74 29 95 74
Operating Income (loss) /tonne 0 34 (12) 54 33
(US$/t)
Flat Carbon Americas crude steel production increased 2.4% to 6.0 million
tonnes for the three months ended December 31, 2011, as compared to 5.9 million
tonnes for the three months ended September 30, 2011, due in part to normalised
North American production following downtime during the third quarter of 2011,
offset by lower production primarily in South America operations.
Steel shipments for the three months ended December 31, 2011 were 5.5 million
tonnes, 4.4% lower than the three months ended September 30, 2011. Shipments
declined in all operations with the exception of the US operations.
Sales in the Flat Carbon Americas segment were $5.0 billion for the three
months ended December 31, 2011, a decline of 8.5% as compared to $5.5 billion
for the three months ended September 30, 2011. Sales decreased primarily due to
lower average steel selling prices (-4.6%) and steel shipment volumes.
EBITDA in the fourth quarter of 2011 declined by 43.6%, to $237 million as
compared to $420 million in the third quarter of 2011, driven primarily by
price cost squeeze in North America on account of lower average steel selling
prices and steel shipment volumes.
Flat Carbon Europe
(USDm) unless otherwise shown 4Q 11 3Q 11 4Q 10 12M 11 12M 10
Sales $7,003 $7,696 $6,817 $31,062 $25,550
EBITDA 26 367 543 1,500 2,015
Operating Income / (Loss) (569) (106) 142 (324) 534
Crude Steel Production (’000t) 6,619 7,390 7,006 29,510 30,026
Steel Shipments (’000t) 6,188 6,385 6,593 27,123 27,510
Average Steel Selling Price (US$ 954 1,021 907 982 821
/t)
EBITDA/tonne (US$/t) 4 57 82 55 73
Operating Income (loss) /tonne (92) (17) 22 (12) 19
(US$/t)
Flat Carbon Europe crude steel production amounted to 6.6 million tonnes for
the three months ended December 31, 2011, a decrease of 10.4% as compared to
7.4 million tonnes for the three months ended September 30, 2011. Production
decreased reflecting very weak market sentiment in Europe and the reduction of
inventories accumulated in the third quarter.
Steel shipments for the three months ended December 31, 2011 were 6.2 million
tonnes, a decrease of 3.1% as compared to 6.4 million tonnes for the three
months ended September 30, 2011. Steel shipments decreased during the fourth
quarter of 2011 due to weaker market conditions and strong destocking activity.
Sales in the Flat Carbon Europe segment were $7.0 billion for the three months
ended December 31, 2011, a decrease of 9.0% as compared to $7.7 billion for the
three months ended September 30, 2011. Sales decreased primarily due to lower
steel shipment volumes and lower average steel selling prices (-6.6%) impacted
by base prices and currency effects.
EBITDA for the three months ended December 31, 2011 was $26 million, as
compared to $367 million for the three months ended September 30, 2011,
primarily driven by lower steel shipment volumes and significant price cost
squeeze.
Operating performance in the fourth quarter of 2011 was negatively impacted by
impairment charges of $56 million relating to various idled facilities and
restructuring costs totalling $143 million associated with the implementation
of the Asset Optimisation Plan primarily relating to Spanish entities. These
charges were offset however, by several positive items: a DDH income $163
million recognized during the quarter and a net gain of $93 million recorded on
the sale of carbon dioxide credits, the proceeds of which will be re-invested
in energy saving projects. Operating results in the third quarter of 2011
included a DDH income of $129 million and $85 million in impairment charges
relating to costs associated with the announced intention to close the two
blast furnaces, sinter plant, steel shop and continuous casters in Liege,
Belgium.
For the comparable fourth quarter of 2010, operating results were positively
impacted by DDH income of $88 million and a gain of $140 million recorded on
the sale of carbon dioxide credits, which were partly offset by a $37 million
impairment charge primarily relating to idled downstream assets.
Long Carbon Americas and Europe
(USDm) unless otherwise shown 4Q 11 3Q 11 4Q 10 12M 11 12M 10
Sales $5,936 $6,676 $5,567 $25,165 $21,315
EBITDA 338 438 315 1,866 2,075
Operating Income / (Loss) (107) 185 28 646 1,004
Crude Steel Production (’000t) 5,474 5,611 5,325 23,558 22,550
Steel Shipments (’000t) 5,846 5,984 5,698 23,869 23,148
Average Steel Selling Price (US$ 906 967 837 937 802
/t)
EBITDA/tonne (US$/t) 58 73 55 78 90
Operating Income (loss) /tonne (18) 31 5 27 43
(US$/t)
Long Carbon Americas and Europe crude steel production amounted to 5.5 million
tonnes for the three months ended December 31, 2011, a decrease of 2.4% as
compared to 5.6 million tonnes for the three months ended September 30, 2011.
Production was lower in the Americas due to drawdown of inventory and overall
weaker market demand.
Steel shipments for the three months ended December 31, 2011 were 5.8 million
tonnes, a decrease of 2.3% as compared to 6.0 million tonnes for the three
months ended September 30, 2011, particularly due to the summer holiday period
in Brazil and lower demand in North America and Europe.
Sales in the Long Carbon Americas and Europe segment were $5.9 billion for the
three months ended December 31, 2011, a decrease of 11.1%, as compared to $6.7
billion for the three months ended September 30, 2011. Sales decreased
primarily due to lower steel shipments and lower average selling prices
(-6.3%).
EBITDA for the three months ended December 31, 2011 was $338 million, a 22.8%
decrease as compared to $438 million for the three months ended September 30,
2011, primarily due to lower steel shipment volumes and lower average steel
selling prices primarily reflecting currency effects.
Operating result in the fourth quarter of 2011 was negatively impacted by
impairment charges of $160 million of which $151 million related to the
extended idling of the ArcelorMittal Madrid electric arc furnace.
Asia Africa and CIS (’AACIS’)
(USDm) unless otherwise shown 4Q 11 3Q 11 4Q 10 12M 11 12M 10
Sales $2,733 $2,619 $2,544 $10,779 $9,706
EBITDA 238 284 215 1,238 1,135
Operating Income 93 162 92 721 681
Crude Steel Production (’000t) 3,579 3,493 3,611 14,608 14,906
Steel Shipments (’000t) 3,065 3,005 3,392 12,516 13,266
Average Steel Selling Price (US$/ 713 771 621 736 608
t)
EBITDA/tonne (US$/t) 78 95 63 99 86
Operating Income / tonne (US$/t) 30 54 27 58 51
AACIS segment crude steel production was 3.6 million tonnes for the three
months ended December 31, 2011, an increase of 2.5% as compared to 3.5 million
tonnes for the three months ended September 30, 2011. The increase in the
fourth quarter of 2011 was primarily due to improved production in Ukrainian
operations.
Steel shipments for the three months ended December 31, 2011 amounted to 3.1
million tonnes, an increase of 2% as compared to 3.0 million tonnes for the
three months ended September 30, 2011.
Sales in the AACIS segment were $2.7 billion for the three months ended
December 31, 2011, an increase of 4.4% as compared to $2.6 billion for the
three months ended September 30, 2011 primarily due to marginally higher steel
shipments, offset by lower average steel selling prices.
EBITDA for the three months ended December 31, 2011 was $238 million, 16.2%
lower as compared to $284 million for the three months ended September 30,
2011. EBITDA during the fourth quarter of 2011 declined primarily due to lower
average selling prices only partially offset by a slight steel shipment volume
increase.
Distribution Solutions^10
(USDm) unless otherwise shown 4Q 11 3Q 11 4Q 10 12M 11 12M 10
Sales $4,876 $4,899 $4,276 $19,055 $15,744
EBITDA / (loss) (19) 48 87 271 456
Operating (Loss) / Income (109) 8 (64) 52 166
Steel Shipments (’000t) 4,957 4,607 4,751 18,360 18,173
Average Steel Selling Price (US$/ 948 1,010 864 993 832
t)
Shipments in the Distribution Solutions segment for the three months ended
December 31, 2011 were 5.0 million tonnes, an increase of 7.6% as compared to
4.6 million tonnes for the three months ended September 30, 2011.
Sales in the Distribution Solutions segment were $4.9 billion essentially flat
for the three months ended December 30, 2011, as compared to the three months
ended September 30, 2011, due primarily to higher steel shipment volumes
(+7.6%) partly offset by lower average steel selling prices (-6.1%).
EBITDA loss for the three months ended December 31, 2011 was $(19) million, as
compared to EBITDA of $48 million for the three months ended September 30,
2011, primarily due to price cost squeeze.
Operating performance in the fourth quarter of 2010 was negatively impacted by
impairment charges of $113 million relating to impairment on certain
subsidiaries, primarily reflecting the weak construction market at that time.
Mining
USDm unless otherwise shown 4Q 11 3Q 11 4Q 10 12M 11 12M 10
Sales^11 $1,805 $1,678 $1,217 $6,268 $4,380
EBITDA 779 842 570 3,063 2,263
Operating income 632 725 377 2,568 1,625
Own iron ore production ^(a) (Mt) 15.1 14.1 12.6 54.1 48.9
Iron ore shipped externally and
internally at market price ^(b) 8.5 6.7 6.7 28.0 25.2
(Mt)
Own coal production^(a) (Mt) 2.2 2.1 1.8 8.3 7.0
Coal shipped externally and
internally at market price^(b) 1.3 1.2 0.8 4.9 3.4
(Mt)
(a) Own iron ore and coal production excluding 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 supply
under strategic long-term contracts
Own iron ore production (excluding supplies under strategic long-term
contracts) increased 7.2% to 15.1 million tonnes for the three months ended
December 31, 2011, as compared to 14.1 million tonnes for the three months
ended September 30, 2011, primarily due to increased production from Liberia
and Mexico.
Own coal production for the three months ended December 31, 2011 increased to
2.2 million tonnes as compared to 2.1 million tonnes for the three months ended
September 30, 2011.
EBITDA attributable to the Mining segment for the three months ended December
31, 2011 was $779 million, 7.5% lower as compared to $842 million for the three
months ended September 30, 2011, primarily due to lower average selling prices
following the change to the seaborne benchmark pricing system impacting a
substantial proportion of marketable volumes. The transition from 4 month
lagged pricing to current quarter average, together with lower market premiums
for Fe.content.
For the comparable fourth quarter of 2010, operating results was negatively
impacted by impairment charges of $186 million relating to Company’s coal mines
in Russia.
Liquidity and Capital Resources
For the three months ended December 31, 2011, net cash provided by operating
activities was $2.9 billion, compared to net cash provided by operating
activities of $0.8 billion for the three months ended September 30, 2011. Cash
flow provided by operating activities for the fourth quarter of 2011 included a
$1.8 billion release of operating working capital as compared to an investment
in operating working capital of $1.0 billion in the third quarter of 2011. The
working capital release in the fourth quarter of 2011 primarily resulted from
lower inventories. Rotation days^12 decreased to 67 days during the fourth
quarter of 2011 from 73 days in the third quarter of 2011.
Net cash used in investing activities for the three months ended December 31,
2011 was $0.5 billion, as compared to $1.3 billion for the three months ended
September 30, 2011, with an increase in capital expenditure offset by
investment divestiture proceeds. Capital expenditures increased to $1.5 billion
for the three months ended December 31, 2011 as compared to $1.3 billion for
the three months ended September 30, 2011. Capital expenditures increased to
$4.8 billion for the twelve months ended December 31, 2011 as compared to $3.3
billion for the twelve months ended December 31, 2010. In light of recent
market uncertainty primarily due to the European debt crisis and its potential
global impact, the Company will continue to calibrate its steel growth projects
to evolving demand situations; at the same time the Company is focusing on core
growth capex in its mining business given their generally more attractive
return profiles. This has resulted in postponement of some planned steel
investments. Accordingly, full year 2012 capital expenditure is expected to be
approximately $4-4.5 billion.
Other investing activities in the fourth quarter of 2011 of $941 million
include an inflow of $796 million from the sale of the Company’s stake in
MacArthur Coal and $129 million relating to the sale of the Company’s 12% stake
in Baosteel-NSC/Arcelor (BNA) Automotive Co.
Net cash used by financing activities for the three months ended December 31,
2011 was $1.2 billion, as compared to cash provided by financing activities of
$0.3 billion for the three months ended September 30, 2011.
During the fourth quarter of 2011, the Company repaid loans for a net amount of
$816 million primarily related to a reduction in commercial paper and bank
loans. Additionally, during the fourth quarter of 2011, the Company paid
dividends amounting to $289 million as compared to $309 million in the third
quarter of 2011. Dividends paid during the fourth quarter of 2011 included $7
million paid to minority shareholders. During the third quarter of 2011, the
Company received a $250 million cash inflow from the increase in the privately
placed mandatorily convertible bond issued on December 28, 2009 by one of its
wholly-owned Luxembourg subsidiaries.
At December 31, 2011, the Company’s cash and cash equivalents (including
restricted cash and short-term investments) amounted to $3.9 billion as
compared to $2.8 billion at September 30, 2011. During the quarter, net debt
decreased by $2.4 billion to $22.5 billion, as compared with $24.9 billion at
September 30, 2011, driven by improved cash flow from operations, inflow from
the Macarthur Coal divestment, and foreign exchange gains (effect of USD
appreciation on euro denominated debt).
The Company will continue to seek to reduce net debt through its focus on
working capital management and potential non-core asset disposals.
The Company had liquidity^13 of $12.5 billion at December 31, 2011, an increase
of $1.2 billion as compared with liquidity of $11.3 billion at September 30,
2011, consisting of cash and cash equivalents (including restricted cash and
short-term investments) of $3.9 billion and $8.6 billion of available credit
lines.
Dividend maintained at $0.75 per share for 2012
The Board of Directors will submit to a shareholders’ vote, at the next annual
general meeting, a proposal to maintain the quarterly dividend payment at
$0.1875 per share. The dividend payments would occur on a quarterly basis for
the full year 2012, on March 13, 2012, June 14, 2012, September 10, 2012 and
December 10, 2012, taking into account that the first quarter dividend payment
to be paid on March 13, 2012 shall be an interim dividend.
Payment of the final quarterly 2011 dividend of $0.1875 per share was made on
December 12, 2011.
Update on management gains program and asset optimization plan
At the end of the fourth quarter of 2011, the Company’s annualized sustainable
management gains increased to $4.0 billion as compared to $3.8 billion at
September 30, 2011 (excluding Aperam). The Company maintains its target (based
on the revised plan excluding Aperam) to reach management gains of $4.8 billion
from sustainable SG&A, fixed cost reductions and continuous improvement by the
end of 2012.
Progress has been made on the Asset Optimization Plan launched in September
2011 to generate annualized $1 billion sustainable EBITDA improvement by the
end of 2012:
* The Company announced its intention to close two blast furnaces, sinter
plant, steel shop and continuous casters in Liege, Belgium; negotiations
with employee representatives ongoing;
* Extended downtime of certain Spanish electric arc furnaces (including
ArcelorMittal Madrid) and further restructuring costs at certain other
Spanish and Czech Republic entities and AMDS operations.
Outlook and guidance
The Company’s EBITDA in 1H 2012 is expected to be lower than 1H 2011 but above
2H 2011, supported by continued progress on management gains and asset
optimisation plans.
The Company expects steel shipments in the first half of 2012 to be at a
similar level to first half of 2011. Mining production is expected to be higher
than in the first half of 2011 in line with plans to increase full year 2012
own iron ore and coal production by approximately 10%.
2012 Capex budget is expected to be approximately $4-$4.5 billion including
mining growth plans. A further reduction in net debt is anticipated due to a
continued focus on working capital management and non-core asset divestments,
per the Company’s stated objective to retain its investment grade credit
rating.
ArcelorMittal condensed consolidated statements of financial position
December September December
31, 30, 31,
In millions of U.S. dollars 2011 2011 2010^14
ASSETS
Cash and cash equivalents including $3,905 $2,800 $6,289
restricted cash
Trade accounts receivable and other 6,452 8,194 5,725
Inventories 21,689 23,397 19,583
Prepaid expenses and other current assets 3,559 4,246 4,160
Assets held for distribution – – 6,918
Total Current Assets 35,605 38,637 42,675
Goodwill and intangible assets 14,053 14,683 14,373
Property, plant and equipment 54,251 54,052 54,344
Investments in affiliates and joint 17,971 19,956 19,512
ventures and other assets
Total Assets $121,880 $127,328 $130,904
LIABILITIES AND SHAREHOLDERS’ EQUITY
Short-term debt and current portion of $2,784 $3,626 $6,716
long-term debt
Trade accounts payable and other 12,836 13,772 13,256
Accrued expenses and other current 8,204 8,527 8,714
liabilities
Liabilities held for distribution – – 2,037
Total Current Liabilities 23,824 25,925 30,723
Long-term debt, net of current portion 23,634 24,061 19,292
Deferred tax liabilities 3,680 3,678 4,006
Other long-term liabilities 10,265 10,288 10,783
Total Liabilities 61,403 63,952 64,804
Equity attributable to the equity holders 56,690 59,586 62,430
of the parent
Non-controlling interests 3,787 3,790 3,670
Total Equity 60,477 63,376 66,100
Total Liabilities and Shareholders’ Equity $121,880 $127,328 $130,904
ARCELORMITTAL CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Three months ended Twelve months ended
December September December December December
31, 30, 31, 31, 31,
In millions of U.S. 2011 2011 2010 2011 2010
dollars
Sales $22,449 $24,214 $20,699 $93,973 $78,025
Depreciation (1,220) (1,155) (1,075) (4,669) (4,395)
Impairment (228) (85) (381) (331) (525)
Restructuring charges (219) – – (219) -
Operating income 47 1,168 397 4,898 3,605
Operating margin % 0.2% 4.8% 1.9% 5.2% 4.6%
Income from equity
method investments and 177 6 74 620 451
other income
Net interest expense (429) (477) (413) (1,822) (1,445)
Mark to market on (13) 59 (293) 42 427
convertible bonds
Foreign exchange and
other net financing 26 26 (494) (1,058) (1,182)
gains (losses)
Income (loss) before
taxes and (192) 782 (729) 2,680 1,856
non-controlling
interest
Current Tax (185) (209) (145) (1,018) (821)
Deferred Tax (648) 55 595 136 2,300
Income tax benefit (833) (154) 450 (882) 1,479
(expense)
Income / (loss) from
continuing operations
including (1,025) 628 (279) 1,798 3,335
non-controlling
interests
Non-controlling
interests (relating to 25 31 46 4 (89)
continuing operations)
Income / (loss) from (1,000) 659 (233) 1,802 3,246
continuing operations
Income / (loss) from
discontinued 0 0 (547) 461 (330)
operations, net of tax
Net income / (loss)
attributable to owners $(1,000) $659 $(780) $2,262 $2,916
of the parent
Basic earnings /
(loss) per common (0.65) 0.43 (0.51) 1.46 1.93
share
Diluted earnings /
(loss) per common (0.65) 0.19 (0.51) 1.19 1.72
share
Weighted average
common shares 1,549 1,549 1,515 1,549 1,512
outstanding (in
millions)
Adjusted diluted
weighted average
common shares 1,549 1,611 1,516 1,611 1,600
outstanding (in
millions)
EBITDA^3 $1,714 $2,408 $1,853 $10,117 $8,525
EBITDA Margin % 7.6% 9.9% 9.0% 10.8% 10.9%
OTHER INFORMATION
Total iron ore
production^15 18.3 17.4 18.9 65.2 68.5
Crude steel production
(million metric 21.7 22.4 21.6 91.9 90.6
tonnes)
Total shipments of
steel products^16
20.6 21.1 21.1 85.8 85.0
Employees (in 261 265 263 261 263
thousands)
ARCELORMITTAL CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
In millions of U.S. Three Months Ended Twelve Months Ended
dollars
December September December December December
31, 2011 30, 2011 31, 2010 31, 2011 31, 2010
Operating activities:
Net income / (loss)
from continuing $(1,000) $659 $(233) $1,802 $3,246
operations
Adjustments to
reconcile net income
(loss) to net cash
provided by
operations:
Non-controlling (25) (31) (46) (4) 89
interest
Depreciation and 1,448 1,240 1,456 5,000 4,920
impairment
Restructuring charges 219 – – 219 -
Deferred income tax 648 (55) (595) (136) (2,300)
Change in operating
working capital^17 1,843 (1,013) 2,139 (3,825) (2,531)
Other operating (255) (30) 602 (1,089) 346
activities (net)
Net cash provided by
operating activities – 2,878 770 3,323 1,967 3,770
Continued operations
Net cash (used in)
provided by operating
activities – – – 245 (190) 245
Discontinued
operations
Net cash provided by 2,878 770 3,568 1,777 4,015
operating activities
Investing activities:
Purchase of property,
plant and equipment (1,475) (1,267) (1,379) (4,838) (3,308)
and intangibles
Other investing 941 (31) 235 1,265 (28)
activities (net)
Net cash used in
investing activities – (534) (1,298) (1,144) (3,573) (3,336)
Continued operations
Net cash used in
investing activities – – – (34) (105) (102)
Discontinued
operations
Net cash used in (534) (1,298) (1,178) (3,678) (3,438)
investing activities
Financing activities:
Proceeds relating to
payable to banks and (816) 407 991 537 1,992
long-term debt
Dividends paid (289) (309) (335) (1,194) (1,257)
Proceeds from
mandatorily – 250 – 250 -
convertible bond
Premium paid for call – – (1,363) – (1,363)
option
Sale of treasury – – 1,363 – 1,363
shares
Acquisition of
non-controlling (10) (7) (4) (108) (593)
interest
Other financing (37) (47) (28) (17) (101)
activities (net)
Net cash (used in)
provided by financing (1,152) 294 624 (532) 41
activities – Continued
operations
Net cash (used in)
financing activities – – – (12) (8) (48)
Discontinued
operations
Net cash (used in)
provided by financing (1,152) 294 612 (540) (7)
activities
Net (decrease)
increase in cash and 1,192 (234) 3,002 (2,441) 570
cash equivalents
Transferred to held – – (123) – (123)
for sale
Effect of exchange (85) (178) (58) (68) (159)
rate changes on cash
Change in cash and $1,107 $(412) $2,821 $(2,509) $288
cash equivalents
Appendix 1a: Key financial and operational information – Fourth Quarter of
2011
Long
USDm unless Flat Flat Carbon Distribution
otherwise Carbon Carbon Americas AACIS Solutions Mining
shown Americas Europe and
Europe
FINANCIAL
INFORMATION
Sales $5,030 $7,003 $5,936 $2,733 $4,876 $1,805
Depreciation (236) (452) (408) (145) (50) (147)
and impairment
Restructuring – (143) (37) – (40) -
charges
Operating 1 (569) (107) 93 (109) 632
income (loss)
Operating
margin (as a % 0.0% (8.1%) (1.8%) 3.4% (2.2%) 35.0%
of sales)
EBITDA
237 26 338 238 (19) 779
^3
EBITDA margin
(as a % of 4.7% 0.4% 5.7% 8.7% (0.4%) 43.2%
sales)
Capital
expenditure^18 228 238 359 126 58 453
OPERATIONAL
INFORMATION
Crude steel
production 6,009 6,619 5,474 3,579 – -
(Thousand MT)
Steel
shipments 5,458 6,188 5,846 3,065 4,957 -
(Thousand MT)
Average steel
selling price 868 954 906 713 948 -
($/MT)^19
MINING
INFORMATION
(Million Mt)
Iron ore – – – – – 18.3
production^15
Coal – – – – – 2.4
production^15
Iron ore
shipped
externally and – – – – – 8.5
internally at
market price^4
Iron ore
shipped – – – – – 6.8
internally at
cost-plus^4
Coal shipment
shipped
externally and – – – – – 1.3
internally at
market price^4
Coal shipped
internally at – – – – – 0.8
cost-plus^4
Appendix 1b: Key financial and operational information – Twelve Months of 2011
Long
USDm unless Flat Flat Carbon Distribution
otherwise Carbon Carbon Americas AACIS Solutions Mining
shown Americas Europe and
Europe
FINANCIAL
INFORMATION
Sales $21,035 $31,062 $25,165 $10,779 $19,055 $6,268
Depreciation
and (911) (1,681) (1,183) (517) (179) (495)
impairment
Restructuring – (143) (37) – (40) -
charges
Operating 1,198 (324) 646 721 52 2,568
income
Operating
margin (as a 5.7% (1.0%) 2.6% 6.7% 0.3% 41.0%
% of sales)
EBITDA
2,109 1,500 1,866 1,238 271 3,063
^3
EBITDA margin
(as a % of 10.0% 4.8% 7.4% 11.5% 1.4% 48.9%
sales)
Capital
expenditure^ 664 1,004 1,119 613 152 1,269
18
OPERATIONAL
INFORMATION
Crude steel
production 24,215 29,510 23,558 14,608 – -
(Thousand MT)
Steel
shipments 22,249 27,123 23,869 12,516 18,360 -
(Thousand MT)
Average steel
selling price 892 982 937 736 993 -
($/MT)^ 19
MINING
INFORMATION
(Million Mt)
Iron ore – – – – – 65.2
production^15
Coal – – – – – 8.9
production^15
Iron ore
shipped
externally
and – – – – – 28.0
internally at
market price^
4
Iron ore
shipped – – – – – 23.6
internally at
cost-plus^4
Coal shipment
shipped
externally
and – – – – – 4.9
internally at
market price^
4
Coal shipped
internally at – – – – – 3.3
cost-plus^4
Appendix 2a: Steel Shipments by geographical location^20
(Amounts in thousands tonnes) 4Q 11 3Q 11 4Q 10 12M 11 12M 10
Flat Carbon America: 5,458 5,708 5,432 22,249 21,028
North America 4,206 4,271 3,877 17,084 15,283
South America 1,252 1,437 1,555 5,165 5,745
Flat Carbon Europe: 6,188 6,385 6,593 27,123 27,510
Long Carbon Americas and Europe: 5,846 5,984 5,698 23,869 23,148
North America 1,134 1,190 1,060 4,584 4,245
South America 1,448 1,471 1,312 5,660 5,280
Europe 2,993 3,037 3,018 12,547 12,656
Other^21 271 286 308 1,078 967
AACIS: 3,065 3,005 3,392 12,516 13,266
Africa 980 1,109 1,179 4,624 4,960
Asia, CIS & Other 2,085 1,896 2,213 7,892 8,306
Appendix 2b: Steel EBITDA^3 by geographical location
Amounts in USDm 4Q 11 3Q 11 4Q 10 12M 11 12M 10
Flat Carbon America: $237 $420 $158 $2,109 $1,555
North America 166 366 101 1,615 689
South America 71 54 57 494 866
Flat Carbon Europe: 26 367 543 1,500 2,015
Long Carbon Americas and Europe: 338 438 315 1,866 2,075
North America 11 51 -25 131 65
South America 196 227 184 939 1,394
Europe 58 84 78 518 415
Other^21
73 76 78 278 201
AACIS: 238 284 215 1,238 1,135
Africa 9 -7 -34 232 453
Asia, CIS & Other 229 291 249 1,006 682
Distribution Solutions: -19 48 87 271 456
Appendix 2c: Iron ore production (million metric tonnes)
Million metric Type Product 4Q 3Q 4Q 12M 12M
tonnes ^(a) 11 11 10 11 10
North America Open Pit Concentrate 8.0 7.8 7.1 29.7 27.8
^(b) and Pellets
South America Open pit Lump and 1.4 1.3 1.4 5.3 4.9
Sinter feed
Europe Open pit Lump and 0.5 0.6 0.3 1.9 1.4
fines
Africa Open Pit / Lump and 1.3 0.7 0.3 2.6 1.1
Underground fines
Asia, CIS & Open Pit / Concentrate,
Other Underground lump and 3.9 3.7 3.4 14.6 13.8
fines
Own iron ore 15.1 14.1 12.6 54.1 48.9
production
North America^
(c) Open Pit Pellets 1.9 1.8 4.6 4.6 12.5
Africa ^(d) Open Pit Lump and 1.3 1.4 1.8 6.5 7.0
Fines
Strategic
contracts – 3.2 3.3 6.3 11.1 19.6
iron ore
Group 18.3 17.4 18.9 65.2 68.5
a) Total of all finished production of fines, concentrate, pellets and lumps.
b) Includes own mines and share of production from Hibbing (USA-62.30%) and
Pena (Mexico-50%).
c) Includes two long term supply contracts with Cleveland Cliffs for periods
prior to 2011. On April 8, 2011, arcelormittal announced that it had reached a
negotiated settlement with Cliffs Natural Resources Inc. (’Cliffs’) regarding
all pending contract disputes related to the procurement of iron ore pellets
for certain facilities in the U.S. As part of the settlement, Cliffs and
arcelormittal agreed to specific pricing levels for 2009 and 2010 pellet sales
and related volumes and, beginning in 2011, to replace the previous pricing
mechanism in one of the parties’ iron ore supply agreements with a world
market-based pricing mechanism Accordingly as from the first quarter of 2011,
this excludes the long term supply contract for which settlement was reached.
d) Includes long term lease – prices on a cost-plus basis and purchases made
under the July 2010 interim agreement with Kumba (South Africa).
Appendix 2d: Iron ore shipments (million metric tonnes)
Millions metric tonnes 4Q 11 3Q 11 4Q 10 12M 11 12M 10
External sales – Third party 4.4 2.1 2.4 9.0 7.0
Internal sales – Market-priced 4.1 4.6 4.3 19.0 18.2
Internal sales – Cost-plus basis 6.8 6.9 5.8 23.6 21.6
FCA 2.6 2.6 2.0 7.9 6.1
Long 1.1 1.4 0.9 4.4 3.8
AACIS 3.2 2.9 2.9 11.3 11.6
Total sales 15.3 13.5 12.5 51.6 46.7
Strategic contracts 3.2 3.3 6.3 11.1 19.6
FCA 1.9 1.8 4.6 4.6 12.5
AACIS 1.3 1.4 1.8 6.5 7.0
Total 18.5 16.8 18.9 62.7 66.3
Appendix 2d: Coal production (Million metric tonnes)
Million metric tonnes 4Q 11 3Q 11 4Q 10 12M 11 12M 10
North America 0.69 0.57 0.49 2.43 2.25
Asia, CIS & Other 1.53 1.53 1.29 5.90 4.71
Own coal production 2.22 2.10 1.78 8.32 6.96
North America^(a) 0.14 0.05 0.06 0.32 0.22
Africa^(b) 0.07 0.07 0.04 0.30 0.21
Strategic contracts – coal^(a),(b) 0.21 0.12 0.10 0.62 0.43
Group 2.43 2.22 1.88 8.94 7.39
(a) Includes strategic agreement – prices on a cost-plus basis
(b) Includes long term lease – prices on a cost-plus basis
Appendix 2e: Coal shipment (Million metric tonnes)
Million metric tonnes 4Q 11 3Q 11 4Q 10 12M 12M
11 10
External sales – Third party 0.94 0.80 0.51 3.49 2.12
Internal sales – Market-priced 0.35 0.42 0.29 1.43 1.26
Internal sales (AACIS) – Cost-plus 0.82 0.83 0.86 3.31 3.17
basis
Total sales 2.11 2.05 1.67 8.23 6.55
Strategic contracts 0.21 0.12 0.10 0.62 0.43
Total 2.31 2.17 1.77 8.85 6.98
Appendix 3: Debt repayment schedule as of December 31, 2011
Debt repayment schedule ($ 2012 2013 2014 2015 2016 > Total
billion) 2016
Term loan repayments -
- Convertible bonds – 0.1 2.1 – – 2.2
- Bonds – 3.4 1.3 1.7 1.8 9.2 17.4
Subtotal – 3.5 3.4 1.7 1.8 9.2 19.6
LT revolving credit lines
- $6bn syndicated credit – – – – 1.7 – 1.7
facility
- $4bn syndicated credit – – – – – – -
facility
- $0.3bn bilateral credit – – – – – – -
facility
Commercial paper^22 0.6 – – – – – 0.6
Other loans 2.2 0.5 0.3 0.3 0.7 0.5 4.5
Total Gross Debt 2.8 4.0 3.7 2.0 4.2 9.7 26.4
Appendix 4: Credit lines available as of December 31, 2011
Credit lines available ($ billion) Maturity Equiv. $ Drawn Available
- $6bn syndicated credit facility 18/03/2016 $6.0 $1.7 $4.3
- $4bn syndicated credit facility 06/05/2015 $4.0 – $4.0
- $0.3bn bilateral credit facility 30/06/2013 $0.3 $0.0 $0.3
Total committed lines $10.3 $1.7 $8.6
Appendix 5 – Other ratios
Ratios 4Q 3Q
11 11
Gearing^23 37% 39%
Net debt to average EBITDA ratio based on yearly average EBITDA 1.6X 1.7X
from Jan 1, 2004
Net debt to EBITDA ratio based on last twelve months EBITDA 2.2X 2.4X
Appendix 6: Earnings per Share
Three months ended Twelve months
ended
Dec Sept Dec Dec Dec 30,
30, 30, 30, 30,
In U.S. dollars 2011 2011 2010 2011 2010
Earnings per share – Discontinued
operations
Basic earnings (loss) per common 0.00 0.00 (0.36) 0.30 (0.22)
share
Diluted earnings (loss) per 0.00 0.00 (0.36) 0.29 (0.20)
common share
Earnings per share – Continued
operations
Basic earnings (loss) per common (0.65) 0.43 (0.15) 1.16 2.15
share
Diluted earnings (loss) per (0.65) 0.19 (0.15) 0.90 1.92
common share
Earnings per share
Basic earnings (loss) per common (0.65) 0.43 (0.51) 1.46 1.93
share
Diluted earnings (loss) per (0.65) 0.19 (0.51) 1.19 1.72
common share
Appendix 7: EBITDA Bridge between 3Q 11 v 4Q 11
USD EBITDA Volume & Price-cost Non -Steel Other EBITDA
millions 3Q 11 Mix (a) (b) EBITDA (c) (d) 4Q 11
Group 2,408 (127) (673) 18 88 1,714
a) The volume variance indicates the sales value gain/loss through selling a
higher/lower volume compared to the reference period, valued at reference
period contribution (selling price-variable cost). The product/shipment mix
variance indicates sales value gain/loss through selling different proportion
of mix (product, choice, customer, market including domestic/export), compared
to the reference period contribution.
b) The price-cost variance is a combination of the selling price and cost
variance. The selling price variance indicates the sales value gain/loss
through selling at a higher/lower price compared to the reference period after
adjustment for mix, valued with the current period volumes sold. The cost
variance indicates increase/decrease in cost (after adjustment for mix, one
time items, non-steel cost and others) compared to the reference period cost.
Cost variance includes the gain/loss through consumptions of input materials at
a higher price/lower price, movement in fixed cost, changes in valuation of
inventory due to movement in capacity utilization etc.
c) Non-steel EBITDA variance primarily represents the gain/loss through the
sale of by-products.
d) Other represents the gain/loss through movements in provisions including
write downs, write backs of inventory, onerous contracts, reversal of
provisions, dynamic delta hedge on raw materials, foreign exchange etc as
compared to the reference period.
Appendix 8: Capex^18
Capex USD millions 4Q 11 3Q 11 4Q 10 12M 11 12M 10
Flat Carbon Americas 228 173 171 664 574
Flat Carbon Europe 238 266 364 1,004 792
Long Carbon 359 280 293 1,119 687
Asia, Africa and CIS 126 184 171 613 515
Distribution Solutions 58 34 63 152 124
Mining 453 319 260 1,269 525
Note: Table excludes analysis on account of others and eliminations.
Appendix 9: End notes
^1 The financial information in this press release has been prepared in
accordance 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’. Unless otherwise noted the numbers in the 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.
^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 exceptional items (i.e. $219 million restructuring charge in the fourth
quarter of 2011 and full year 2011).
^4 Market price 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 at the prevailing
market price. Shipments of raw materials that do not constitute market price
tonnes are transferred internally on a cost-plus basis.
^5 Net debt refers to long-term debt, plus short term debt, less cash and cash
equivalents, restricted cash and short-term investments.
^6 This relates to a transaction (a ‘dynamic delta hedge’) designed to hedge
U.S. dollar-denominated raw material purchases until 2012 that ArcelorMittal
entered into in mid-2008 and unwound in late 2008. The unwind resulted, among
other accounting effects, in a deferred gain of approximately $2.6 billion
recorded in equity which, along with the recording of hedged expenses, is being
recycled in the statement of operations during the 2009-2013 period. Of this
amount, $163 million was recorded as income for the three months ended December
31, 2011 and $600 million was recorded as income for the year ended December
31, 2011.
^7 The Company’s investment in Macarthur is accounted for under the equity
method. As a result of the Company’s decision to withdraw from the joint
venture with Peabody Energy to acquire ownership of Macarthur Coal, the Company
recognized an impairment loss of $119 million in the third quarter of 2011. The
impairment for the full year 2011 was $107 million reducing since the third
quarter 2011 as a result of the increase in the sale price from AUD16.00 to
AUD16.25. This charge reflects a higher carrying value of the investment in
Macarthur, which included accrued share of net income. After considering
dividends received and changes in exchange rate through October 25, 2011 (date
of the divestiture announcement) the transaction was essentially cash neutral.
^8 On December 14, 2010 and December 18, 2010, respectively, the Company
acquired 61.7 million euro-denominated call options and 26.5 million
dollar-denominated call options on its own shares in order to hedge its
obligations under these convertible bonds.
^9 Foreign exchange and other net financing costs include foreign currency
swaps, bank fees, interest on pensions, impairments of financial instruments
and revaluation of derivative instruments.
^10 As from January 1, 2011 the Steel Solutions and Services segment has been
renamed ArcelorMittal Distribution Solutions (AMDS).
^11 There are three categories of sales: 1) ‘External sales’: mined product
sold to third parties at market price; 2) ‘Market-priced tonnes’: internal
sales of mined product to ArcelorMittal facilities at prevailing market prices;
3) ‘Cost-plus tonnes’ – internal sales of mined product to ArcelorMittal
facilities on a cost-plus basis. The determinant of whether internal sales are
transferred at market price or cost-plus is whether or not 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).
^12 Rotation days are defined as days of accounts receivable plus days of
inventory minus days of accounts payable. Days of accounts payable and
inventory are a function of cost of goods sold. Days of accounts receivable are
a function of sales.
^13 Includes back-up lines for the commercial paper program of approximately
$2.6 billion (EUR2 billion).
^14 In accordance with IFRS the Company has adjusted the 2009 financial
information retrospectively for the finalization in 2010 of the allocation of
purchase price for certain business combinations carried out in 2009. The
adjustments have been reflected in the Company’s consolidated financial
statements for the year ended December 31, 2010.
^15 Total of all finished production of fines, concentrate, pellets and lumps
(includes share of production and strategic long-term contracts). (million
metric tonnes)
^16 ArcelorMittal Distribution Solutions shipments are eliminated in
consolidation as they primarily represent shipments originating from other
ArcelorMittal operating subsidiaries. (million metric tonnes)
^17 Changes in operating working capital are defined as trade accounts
receivable plus inventories less trade accounts payable.
^18 Capex includes the acquisition of intangible assets (such as concessions
for mining and IT support).
^19 Average steel selling prices are calculated as steel sales divided by steel
shipments.
^20 Shipments originating from a geographical location.
^21 Includes Tubular products business.
^22 Commercial paper is expected to continue to be rolled over in the normal
course of business.
^23 Gearing is defined as (A) long-term debt, plus short-term debt, less cash
and cash equivalents, restricted cash and short-term investments, divided by
(B) total equity.
[CT]
Kontakt:
ArcelorMittal Investor Relations
Europe, +352 4792 2652
Americas, +1 312 899 3569
Retail, +352 4792 2434
SRI, +44 203 214 2854
Bonds/Credit, +33 1 71 92 10 26
or
ArcelorMittal Corporate Communications
press@arcelormittal.com
+352 4792 5000
or
Giles Read (Head of Media Relations), +44 20 3214 2845
Lynn Robbroeckx, +44 20 3214 2991
Tobin Postma, +44 203 214 2412
or
France
Image 7:
Sylvie Dumaine, +33 1 53 70 94 17
or
United Kingdom
Maitland Consultancy:
Martin Leeburn, +44 20 7379 5151
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