ArcelorMittal Positive on 2018, Proposes Dividend -- Earnings Review
31 January 2018 - 9:42PM
Dow Jones News
By Alberto Delclaux
ArcelorMittal (MT.AE) reported its fourth-quarter results before
the market opened on Wednesday. Here's what you need to know:
SALES: Sales rose by about 25% to $17.71 billion due to higher
steel and iron-ore shipments and higher average steel selling
prices. The results fell slightly short of a FactSet-compiled
consensus of analyst estimates that forecast $17.94 billion.
NET INCOME: The steelmaker posted quarterly net profit of $1.04
billion, more than doubling its result from a year ago, propped up
by sales performance. The company recorded an income tax benefit of
$119 million in the quarter, which compares with a $71 million tax
expense in the year-earlier period.
MACRO OUTLOOK: ArcelorMittal was upbeat about the steel industry
outlook for 2018, saying that the demand environment remains
positive and steel spreads remaining healthy. The company estimates
global steel demand--measured through apparent steel
consumption--to grow between 1.5% and 2.5% in 2018, with Chinese
demand flat.
CASH FLOW: Net debt decreased this quarter by $1.9 billion to
$10.1 billion, mainly due to positive free cash flow. The debt
figure at year-end was $0.9 billion lower than on Dec. 31, 2016.
ArcelorMittal said that it would continue to prioritize
deleveraging--it has a net debt target of $6 billion--but proposed
a dividend of $0.10 per share in 2018. Once the debt level falls to
or below its target, the company will return a portion of annual
free cash flow to shareholders, it said.
ILVA: ArcelorMittal said that it will continue "to work closely
and constructively" with the European Commission, which has opened
a phase II review of its proposed acquisition of Italian steelmaker
Ilva. Arcelor's 1.8 billion euros ($2.23 billion) acquisition had
become mired in controversy after an EU antitrust investigation
ruled that the Italian government must recover around EUR84 million
in illegal state aid.
Write to Alberto Delclaux at alberto.delclaux@dowjones.com
(END) Dow Jones Newswires
January 31, 2018 05:27 ET (10:27 GMT)
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