Steel Giant ArcelorMittal Swings to Loss -- Update
August 01 2019 - 4:17AM
Dow Jones News
By Alistair MacDonald and Olivia Bugault
ArcelorMittal, the world's largest steelmaker, swung to a loss
in the second quarter and said it plans to shed about $2 billion in
assets, adding that it expects the beleaguered industry to suffer a
fall demand in Europe and the U.S.
The global steel industry has been hit by overcapacity and the
massive gains in the price of iron ore, a central ingredient in
production, after the Brumadinho tailings dam disaster curbed
mining of the resource in Brazil.
Chief Financial Officer Aditya Mittal called for tougher
protective measures to help Europe-based steelmakers compete
against imports, but also said that U.S. tariffs on imports of the
metal have pushed domestic production above demand, putting
pressure on prices.
ArcelorMittal's net loss for the quarter was $447 million,
compared with a profit of $1.87 billion a year earlier, as the
company booked $900 million in impairments, it said.
The company, though, promised further debt reduction and asset
sales of around $2 billion over the next two years. Earnings before
interest, taxes, depreciation and amortization totaled $1.6
billion, ahead of a company-compiled consensus.
ArcelorMittal's shares were up 2.2% in morning trade.
Sales totaled $19.28 billion for the quarter, down from $20
billion a year earlier, the company said.
The company expects global steel demand in 2019 to grow between
0.5% and 1.5%, a half-percentage-point fall in its forecast.
Mr. Mittal said the company's debt levels were at the lowest in
the company's history.
Write to Alistair MacDonald at alistair.macdonald@wsj.com
(END) Dow Jones Newswires
August 01, 2019 05:02 ET (09:02 GMT)
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