ArcelorMittal Q3 Loss Narrows; Says Bottom Of The Cycle Is Behind

(RTTNews) - Steel giant ArcelorMittal (MT) Thursday reported a narrower loss for the third quarter, even as sales slipped from last year. It believes that the bottom of the cycle is behind. The company also backed its annual forecast for Earnings Before Interest, Taxes, Depreciation and Amortization or EBITDA. About the prospects for 2014, ArcelorMittal said it remains cautiously optimistic.

Lakshmi Mittal, ArcelorMittal Chairman and CEO, said: "After a weak first half, we have seen third quarter performance improve year-on-year, positively impacted by our cost optimisation efforts and the increased shipments from our mining expansion.''

Mittal believes that the bottom of the cycle is behind and expects second half EBITDA, usually comparably weaker, to be at least equal to the first. Although operating conditions remain challenging, since economic indicators are improving, the firm is cautiously optimistic about the prospects for 2014.

Net loss from continuing operations narrowed to $193 million from $652 million reported last year. Loss per share was $0.12, compared with $0.42 a year ago. Prior-year results have been adjusted.

The latest results included impairment charges of $101 million related to costs associated with the discontinued iron ore project in Senegal. In the prior year, impairment charges totaled $130 million, primarily related to the long term idling of the liquid phase at Florange. There were no restructuring charges this year, compared to $98 million last year.

EBITDA increased to $1.71 billion from $1.45 billion, and was marginally higher from the preceding second quarter.

Sales, however, slid to $19.64 billion from $19.72 billion. The decrease was 2.7 percent sequentially, primarily due to lower average steel selling prices and marginally lower steel volumes.

Segment-wise, sales improved year-over-year as well as sequentially in Flat Carbon Americas, amid improvement in Flat USA following resolution of labor issues at Burns Harbor.

Steel shipments advanced 6 percent to 21.1 million metric tons, while own iron ore production grew 4.5 percent to 14.9 million metric tons. Crude steel production advanced to 23.3 million metric tons from 21.9 million metric tons.

The firm recorded an income tax benefit of $5 million, compared to an income tax expense of $44 million last year.

The company still expects 2013 EBITDA to be greater than $6.5 billion.

MT closed down 0.1 percent at $16.18 on Wednesday.