ArcelorMittal reports third quarter 2023 results and mourns Kostenko victims

Commenting, Aditya Mittal, ArcelorMittal Chief Executive Officer, said:

"On October 28, 2023, we suffered a catastrophic accident at the Kostenko coal mine in Kazakhstan that took the lives of 46 colleagues. We mourn their passing and deeply regret the devastation caused to the families of the victims. We are doing everything in our power to support them, and our communities at this difficult time.

The only course of action is to ensure that we take a hard look inside our Group, identify the gaps that exist and strengthen our safety actions, processes and culture to ensure that we prevent all serious accidents. For this reason, we are commissioning a comprehensive independent 3^rd party safety audit, the key recommendations of which will be published in due course.

We are committed to learning from this tragedy and taking the appropriate action so that we emerge a better, safer Company.”

3Q'23 financial results:

• 3Q 2023 was impacted by a negative price-cost effect and a -3.7% sequential decrease in steel shipments to 13.7Mt (scope adjusted² -4.3% lower vs. 3Q 2022), resulting in a decline in operating income to $1.2bn in 3Q 2023 (vs. $1.9bn in 2Q 2023)⁵
• Despite the challenging market environment, the Company continues to demonstrate structurally improved profitability: EBITDA of $1.9bn in 3Q 2023 (vs. $2.6bn in 2Q 2023); EBITDA/t was $136/t, well above the longer-term historical averages for the Group, reflecting the benefits of portfolio optimization and strategic projects
• Similarly, net income remains well above longer term historical averages at $0.9bn in 3Q 2023 (vs. $1.9bn in 2Q 2023) reflecting the lower cost balance sheet and significant contribution from the share of JV and associates net income ($0.3bn in 3Q 2023 vs. $0.4bn in 2Q 2023)
• This is reflected in the 3Q 2023 basic EPS of $1.11/sh and the last 12 months rolling ROE³ of 9.4%; book value per share⁴ stands at $66/sh
• The Company ended the quarter with net debt of $4.3bn (gross debt of $10.5bn less cash and cash equivalents of $6.3bn) which is $0.2bn lower than at the end of June 30, 2023; and strong liquidity at end of September 30, 2023 of $11.8bn
• The Company has repurchased 26.2m shares during 9M 2023 including 7.1m from the current 85m share buy back program

Outlook

• The Company remains positive on the medium/long-term steel demand outlook and supported by its strong financial position remains focused on safety and executing its strategy of growth with capital returns
• FY 2023 capex is expected to be towards the mid-point of the previously communicated guidance range ($4.5bn-$5.0bn); strategic growth projects remain on track and estimated to deliver $1.3bn of additional normalized¹² EBITDA; the Company’s decarbonization projects are progressing; and our XCarb products are gaining commercial momentum
• The Company continues to expect a working capital release for the year (9M 2023 working capital investment of $0.9bn) and expects 4Q 2023 FCF to remain healthy.

Source: ArcelorMittal, Photo: Fotolia