By KEVIN NEVERS
reporting a net loss in the second quarter of 2020 of $559 million or 50
cents per share, compared to a net loss in the first quarter of $1.12
billion or $1.11; and a net loss in the year-ago period of $447 million or
Chair and CEO
Lakshmi MIttal released the following statement today:
first six months of the year, and particularly the second quarter, have been
one of the most difficult periods in the history of the company, with demand
for steel considerably disrupted by the COVID-19 pandemic. I would like to
thank our employees across the globe, who have demonstrated great resilience
and strength of character to first look out for one another and then
maintain operations to meet customer demand in these most challenging of
"As a group we
responded swiftly to protect our people, assets, profitability, and cashflow,
ensuring the company is in as strong a position as possible to weather this
very challenging period. We implemented a comprehensive range of measures
that include reducing production, capex and fixed costs, as well as raising
capital to further strengthen the balance sheet, which has taken our net
debt close to the level at which we will prioritize returns to shareholders.
“There are now
signs of activity picking up, especially in regions where lockdowns have
ended, but clearly it is prudent to remain cautious about the outlook.
Against this context, we are examining what structural changes might be
required to ensure the company is well configured to prosper in the coming
years as demand recovers.
"It has also become
clear in recent months that governments around the world will align efforts
to stimulate the economic recovery with the transition to a low-carbon
economy. ArcelorMittal recently published its roadmap to reduce emissions by
30 percent in Europe by 2030 and we were encouraged to see last week’s
proposal by the European Council to introduce a carbon border adjustment.
Technologically we know that it should be possible to produce carbon-neutral
steel, but success is co-dependent on policy, of which the carbon border
adjustment is an important component, as is access to EU funds.
“In conclusion, it
has been an unexpectedly challenging period for everyone. The remainder of
the year will no doubt continue to be challenging but I believe we are well
prepared to increase production and capture the improvement in demand when
the following observations about the current operating climate:
-- "While the speed
and trajectory of the demand recovery post COVID-19 pandemic remain
uncertain, ArcelorMittal’s core
markets are showing signs of recovery from exceptionally low levels.”
-- "The company
will continue to align production levels to demand, with the ability and
flexibility to restart hot idled capacity as the recovery progresses.”
-- "Against the
exceptional operating backdrop, the company has taken a comprehensive series
of actions to reduce all costs to protect profitability and cash flows.
While these actions will continue, the company is now developing its options
for structural cost improvements to appropriately position the fixed cost
base for the post COVID-19 operating environment.”
-- Sales: $10.9
billion ($14.8 billion 1Q; $19.2 billion year-ago).
$253 million $353 million 1Q; $158 million year-ago).
production: 14.4 million net tons (21.1 million 1Q; 23.8 million year-ago).
14.8 million net tons (19.5 million 1Q; 22.8 million year-ago).