ArcelorMittal says it is developing options for further structural cost savings to prepare for the post-Covid-19 operating environment. This follows the closure of the hot-end plant in Krakow in October. More details will be provided along with the 2020 results in February.
Steel shipments fell 13% year-over-year in the third quarter to 17.5 million tonnes, but this is 18% more than in the second quarter as economic activity recovered in all regions following the impact of Covid-19. Steel production fell 23% to 17.2 million tonnes, but domestic production of iron ore rose 9% to 14.8 million tonnes.
Consolidated sales fell 20% year-over-year to $ 13.27 billion, although they were up 21% from the second quarter. Ebitda fell 15% year-over-year to $ 901 million, but its net loss fell 52% to $ 261 million.
The quarter-on-quarter recovery in sales was driven primarily by an increase in steel supplies, with an improved sales mix – a higher share of car sales – largely offsetting lower sales prices. In addition, sales to the mining industry increased from the prior year and quarter due to higher prices for iron ore.
“The easing of isolation measures has led to an increase in the level of activity since Q2 2020; however, demand remains below normal and the pace and profile of the recovery is uncertain, ”says ArcelorMittal in the report. The company began to restart hot-idle capacity as market demand improves from region to region; however, concerns about the impact of the second wave persist.
“The experience of the past 6-7 months has forced the business to act differently, in particular, with a more economical cost structure,” the company continues.
In the nine months to September, steel shipments fell 20% year-on-year to 51.8 million tonnes, while steel production fell 25% to 52.7 million tonnes. Sales fell 29% to $ 39.09 billion, Ebitda fell -40% to $ 2.58 billion, and its net loss more than tripled to $ 1.94 billion.