Helped by higher sales and less interest outgo, steel giant ArcelorMittal’s net loss narrowed during the first quarter at USD 205 million as the company expressed ‘cautious optimism’ for the rest of the year.
The world’s largest steel producer, headed by NRI Lakshmi N Mittal, had clocked USD 345 million net loss during the January-March quarter of last year.
“Today’s figures continue to show the improved year- over-year performance of our business driven by recovering steel markets, the expansion of our mining operations and the continued benefits of our focused cost optimisation,” Mittal, who is also company’s Chairman and CEO, said in a statement.
Based on current economic outlook, the company expects global apparent steel consumption to increase by approximately 3-3.5 per cent in 2014.
Apparent steel consumption refers to the sum of net industry shipments within a given country or region, plus its imports and minus its exports.
“The prospects for growth of our core markets in Europe and the US are encouraging, and overall, we remain cautiously optimistic about the business outlook for the rest of 2014,” Mittal said.
The company upgraded its forecast for the European steel demand in 2014 to 2-3 per cent from 2 percent earlier, buoyed by stronger-than-expected recovery in the region. The US has also shown positive signs of “stronger” growth in the second and third quarters of this year.
EBITDA of the company during the quarter went up to USD 1.75 billion against USD 1.56 billion during the period under review.
Total steel shipments grew by 2.4 percent to 21 million tonnes (MT) during the quarter gainst 20.5 MT in the same period a year earlier.
Sales for the reporting quarter stood at USD 19.78 billion compared to USD 19.75 billion in the year-ago period.
ArcelorMittal had a net debt of USD 18.5 billion as of March 31, 2014.
It expects net interest expense for full year 2014 to be at approximately USD 1.6 billion, according to the company statement.
The company’s net interest expense in the first quarter stood at USD 426 million compared to USD 478 million for the same period last year. Foreign exchange and other net financing costs also increased to USD 380 million from USD 155 million a year-ago period.
The company expects its EBITDA to be around USD 8 billion for 2014 on hopes of its steel shipment increasing by about 3 per cent during the period over the previous year, and marketable iron ore shipments going up by around 15 per cent.