ArcelorMittal Posts Q3 Loss; Proposes To Suspend Dividend For FY15

(RTTNews) - ArcelorMittal (MT), the world's leading integrated steel and mining company, reported a third-quarter net loss of $711 million, or $0.40 per share, compared to net income of $22 million, or $0.01 per share, prior year. The company noted that its third-quarter net loss includes $0.5 billion exceptional charge related to the write-down of inventory following the rapid decline of international steel prices. EBITDA decreased to $1.35 billion from $1.90 billion.

Operating income was $20 million, compared to $959 million, a year ago. Given the challenging global economic conditions and the company's priority to deleverage, ArcelorMittal's Board proposed that no dividend be paid for financial year 2015. The proposal is subject to shareholder approval.

Total steel shipments were at 21.1 million metric tonnes, 2.1% lower as compared to 21.5 million metric tonnes prior year, primarily due to lower volumes in NAFTA. Sales were $15.6 billion compared to $20.1 billion, a year ago. Net interest expense were at $318 million, lower as compared to $338 million last year.

ArcelorMittal expects shipments in 2015 to be slightly higher than 2014. The company now expects full year 2015 EBITDA of $5.2-$5.4 billion. Full year 2015 guidance on capital expenditure is expected to be approximately $2.8 billion as compared to the previous guidance of approximately $3.0 billion, and the company continues to expect positive free cash flow generation in 2015 and to end the year.

ArcelorMittal expects to improve EBITDA in 2016 by $1 billion relative to the fourth quarter 2015 run-rate level. The company said it is reducing cash requirements in 2016 by approximately $1 billion as compared to 2015. This is achieved through lower capex spend, lower cash interest costs, lower cash taxes and suspending the dividend for the financial year 2015.