The world's largest steelmaker ArcelorMittal has reported an 18.91 percent year-on-year increase in net profit to $1.32 billion for the second quarter of the current year on the back of higher sales. In the second quarter, the company’s sales rose 16.96 percent to $17.24 billion from $14.74 billion in the corresponding period last year.
Meanwhile, in the first half of this year, ArcelorMittal’s net profit increased to $2.32 billion from $696 million recorded in the same period of the previous year. Operating income was recorded at $3.0 billion as compared to $2.1 billion in the first half of 2016. The company’s sales in the first six months this year increased to $33.33 billion, up 18.4 percent year on year, primarily due to higher average steel selling prices and higher seaborne iron ore reference prices. Crude steel production of the company in the first half stood at 23.2 million mt, almost at the same level year on year.
ArcelorMittal’s CEO Lakshmi Mittal stated that the company materially improved its financial performance in the first half of the current year and continues to make important progress on its Action 2020 plan and added that the recently announced acquisition of Italian steelmaker Ilva represents a unique opportunity to create value for its shareholders. ArcelorMittal said it will leverage its strengths to realize Ilva's potential as a Tier 1 supplier to European and Italian steel customers.
"Looking ahead, demand remains strong in our core markets supporting robust order books and healthy levels of steel spreads. However, it remains a matter of concern that we are not able to capture the full benefits of this demand growth due to continued high levels of imports. We continue to work towards achieving a comprehensive trade solution in response to unfair imports," Mr. Mittal said.
On the company's outlook, in its statement ArcelorMittal said, "Current market conditions are improved compared to 12 months ago with steel spreads currently at healthy levels. The demand environment is positive, which suggests that steel shipments in H2 2017 will be higher than would normally be suggested by seasonality alone."
Given the improved market conditions, for the current year the company now expects an investment in working capital of approximately $1.5 billion, as compared to previous guidance of approximately $1 billion.