ArcelorMittal SA’s steel sales rise by 31 percent in H1, posts profit

On July 28, the world's largest steelmaker ArcelorMittal's South African unit, ArcelorMittal South Africa (ArcelorMittal SA), announced that in the first half of 2010 it recorded headline earnings of ZAR 1.8 billion ($244.89 million), compared to a loss of ZAR 844 million during the corresponding period of last year and a profit of ZAR 404 million in the second half of 2009.
 
ArcelorMittal SA's total steel sales for the first half 2010 were 2.7 million metric tons, which was 31 percent higher than the corresponding period last year and 12 percent higher than the preceding six months.
 
In the given period, net realized prices were on average eight percent higher than the preceding six months and remained at much the same levels as in the corresponding period last year. In US dollar terms, however, prices rose by 22 percent compared to the first six months last year, due largely to the strength of the rand which moved from an average rand/US dollar exchange rate of ZAR 9.22 to ZAR 7.54.
 
In its flat steel business ArcelorMittal SA operated at a 72 percent utilization rate, compared to 54 percent in H1, while in its long steel business the company's capacity utilization rate stood at 87 percent, up from 74 percent in the first six months of 2009.
 
In the January-June period of this year, ArcelorMittal SA's exports increased by 10 percent compared to the preceding six months, and by 17 percent compared to a year ago.
 
Commenting on the outlook for the next quarter, ArcelorMittal SA CEO Nonkululeko Nyembezi-Heita said, "The earnings for the third quarter are expected to decline compared to the previous quarter due to lower international steel prices and demand together with input material costs that still remain at high levels".