The firm, led by billionaire Lakshmi N Mittal, also saw its net debt decrease to USD 11.1 billion.
New Delhi: The world's largest steelmaker ArcelorMittal on Friday reported a 19 per cent jump in its net income to USD 1.19 billion for the quarter ended March 31, 2018.
The firm, led by billionaire Lakshmi N Mittal, also saw its net debt decrease to USD 11.1 billion. The company had posted a net income of USD 1 billion in the year-ago period. Sales of the steel giant rose 19.27 per cent to USD 19.18 billion in January-March period from USD 16.08 billion in the corresponding period last year.
ArcelorMittal follows the January-December fiscal year. The Luxembourg-based firm reported a lower net debt of USD 11.1 billion as compared to USD 12.1 billion in the year-ago quarter. The net debt included working capital investment of USD 1.9 billion, share buyback USD 0.2 billion and forex USD 0.2 billion.
ArcelorMittal's Chairman and CEO Lakshmi Mittal said: "The improvement in global steel market dynamics has continued into 2018, supporting an encouraging financial performance in the first quarter. EBITDA increased 13 per cent year-on-year to USD 2.5 billion, while net income improved by 19 per cent to USD 1.2 billion."
The outlook for 2018 has strengthened as the year has progressed, with the combination of growing demand and supply-side reform driving higher capacity utilisation rates and healthy steel spreads globally, he said.
"Against this improving backdrop, we continue to focus on structural improvement - through the delivery of our Action 2020 strategic plan - and investing with focus and discipline in opportunities that will drive higher future returns. "Our acquisition of Ilva has now received competition clearance from the European Commission and we expect to complete this acquisition by the end of the second quarter 2018," Mittal said.
ArcelorMittal also reported steel shipments of 21.3 million tonnes (MT) in the first quarter of 2018, marginally up from 21.1 MT in the year-ago period. Iron ore shipments at market price in January-March rose to 9.1 MT from 8.7 MT earlier. Crude steel production dipped to 23.3 MT during the quarter under review from 23.6 MT.
The company said it is positioned to deliver value and the execution of its strategy, combined with improved industry fundamentals, and the strengthening market backdrop has resulted in improved results.
"There is more to come from our Action 2020 initiatives in the coming periods, particularly from volume and mix improvements. In recent years, the company has transformed its balance sheet. This deleveraging bias will continue as we target a net debt of below USD 6 billion to support an investment grade rating at all points of the cycle," it said.
ArcelorMittal is also trying to gain a firm foothold in India and has bid for debt-laden Essar Steel which is currently undergoing insolvency proceedings.
"On February 12, 2018, the Company's subsidiary ArcelorMittal India Private Limited (AMIPL) submitted a Resolution Plan for Essar Steel India Limited (Essar Steel) which set out a detailed plan to restore Essar Steel's fortunes and enable it to realise its full potential and participate in the anticipated steel demand growth in India," it said.
On March 2, 2018, ArcelorMittal signed a joint venture formation agreement with Nippon Steel and Sumitomo Metal Corporation (NSSMC) in relation to its offer to acquire Essar Steel, it said.
The Committee of Creditors (CoC) on May 2 had met representatives of ArcelorMittal and Numetal regarding their eligibility for Essar Steel and a decision is awaited.
ArcelorMittal is the world's leading steel and mining company, with a presence in 60 countries and an industrial footprint in 18 countries. In 2017, ArcelorMittal had revenues of USD 68.7 billion and crude steel production of 93.1 million tonnes, while own iron ore production reached 57.4 million tonnes.