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ArcelorMittal, the world’s largest steel company, has reported a net loss of $1.1 billion in the quarter ended March against a net profit of $414 million in the same period last year due to the impact of Covid-19.
Sales during the quarter dipped to $5 billion against $19 billion logged in the comparative quarter last year.
Consolidated earnings before interest, taxes, depreciation and amortisation (EBITDA) per tonne plunged to $50 against $76 recorded last year, while that of steel was down at $34 ($56).
Steel sales dipped to 19.5 million tonnes (21.8 mt), while production slipped to $21 mt ($24 mt).
Iron ore production was up marginally at 14.4 mt (14.1 mt), while sales were lower at 8.6 mt (9.2 mt).
Lakshmi N Mittal, ArcelorMittal Chairman and CEO, said the improved operating performance in the first quarter has been considerably overshadowed by the Covid-19 crisis. The company had moved swiftly to temporarily idle its furnaces, cutting production across markets.
“There are still too many uncertainties to accurately predict what the rest of the year holds. However, it seems likely that over the course of this month countries will start to announce details of their exit strategies,” he said.
As the lockdown is eased, among the first sectors to be permitted to restart operations would be construction and manufacturing. And indeed there are signs of customers re-starting production too.
“The remainder of this year will be challenging, but I am confident that ArcelorMittal has the experience to manage through these difficult times. As a result of the hard work undertaken in recent years to strengthen the balance sheet, we went into the Covid-19 crisis with the lowest net debt since the creation of the company,” he said.
Despite the impact of Covid-19, ArcelorMittal Nippon Steel India recorded crude steel production of 1.7 mt at an EBITDA of $140 million.
Cash needs of ArcelorMittal Nippon Steel India are less than $250 million per annum.
The company was declared the preferred bidder for the 5.5 mtpa Thakurani iron ore mine, Odisha, in March. The mine is strategically located close to AM/NS India’s operations and will strengthen the security of supply of raw material, said the company.
In March, it completed acquisition of the 500 MW Bhander power in Hazira, which provides up to 60 per cent of Hazira’s power requirements
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