Steel giant ArcelorMittal (MT) Friday reported a loss for the first quarter, compared to a profit last year, as sales dropped 13 percent with declines across all segments, amid challenging economic conditions. However, the results improved from the preceding fourth quarter.
The company expects sequential improvement in Earnings Before Interest, Tax, Depreciation and Amortization or EBITDA for the second quarter. The steel maker also backed its guidance framework for 2013.
Lakshmi Mittal, Chairman and CEO of ArcelorMittal, said, "Economic conditions remain challenging but our performance in the quarter reflects the results of the management action we have taken to confront the effects of the financial crisis.''
Net loss for the quarter was $345 million compared to a profit of $92 million last year, yet improved from the preceding fourth quarter's net loss of $3.8 billion that included a hefty impairment charge related to ArcelorMittal's European businesses.
Loss per share was $0.21 compared to earnings per share of $0.06 last year. Prior-year figures have been recast following mandatory adoption of new accounting standards.
EBITDA declined to $1.565 billion from $2.118 billion, and was slightly ahead of the fourth quarter's $1.557 billion.
Sales declined to $19.752 billion from $22.703 billion in the previous year, but were better than $19.3 billion generated in the fourth quarter.
Total shipments of steel products fell to 20.9 million metric tonnes from 22.2 million metric tonnes, but increased from the previous quarter's 20.0 million metric tonnes.
Sales decreased 8 percent to $4.859 billion in the Flat Carbon Americas segment, and crude steel production also dropped.
Flat Carbon Europe sales were $6.834 billion, down 11.5 percent from last year, but crude steel production was slightly higher.
The company reiterated its guidance framework for 2013. Assuming that in 2013 iron ore prices and the margin of steel prices over raw material costs are similar to the levels of 2012, the company expects to report EBITDA above $7.1 billion.
Further, ArcelorMittal confirmed that the asset optimization introduced in the fourth quarter of 2011 is expected to deliver annualized savings of $1 billion and its full impact should be seen in 2014.
The stock gained 3.1 percent in Amsterdam on Thursday to settle at 9.84 euros.
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