© Reuters. FILE PHOTO: The ArcelorMittal logo is depicted in front of the heat rising from a glowing steel plate at the ArcelorMittal steel mill in Ghent
By Philip Blenkinsop
BRUSSELS (Reuters) – ArcelorMittal (LU 🙂 (AS :), the world's largest steelmaker, reported a core profit in the third quarter on Thursday that was above expectations as the easing of COVID-19 lockdowns resulted in improved demand across all regions.
The company, which accounts for roughly 5% of the world's steel, announced that core earnings (EBITDA) were down 15% year over year to $ 901 million, compared to an average expectation of $ 838 million in a company compiled Survey.
CEO Lakshmi Mittal said in a statement that steel markets had recovered from a very challenging second quarter, with a particular improvement in earnings in Brazil and its unit group South Africa, Kazakhstan and Ukraine.
The company said its mining business also did better with higher iron ore prices and higher production. Iron ore supplies sold at market prices are now expected to be roughly at the level of 2019. Previously, the company had forecast a 5% decline.
ArcelorMittal said it has started restarting some of its idle capacity, although demand remained below normal, with a second wave of COVID-19 adding to uncertainty.
The company added that it was operating on a leaner cost structure based on its experience over the past six to seven months and was aiming for more permanent cost savings when it released full-year results in February. It has already decided to permanently close its blast furnace in Krakow, Poland.
ArcelorMittal also met its net debt target of $ 7 billion at the end of the quarter. This is the lowest level since ArcelorMittal was founded in 2006 and a point at which the company can begin giving cash back to shareholders.
The company stands ready to sell its U.S. assets in a cash and stock deal with Cleveland-Cliffs Inc (N 🙂 for $ 1.4 billion to initiate a $ 500 million share buyback.
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