Luxembourg, 11 November 2021 – ArcelorMittal (“ArcelorMittal” or the “Company”) (MT (New York, Amsterdam, Paris, Luxembourg), MTS (Madrid)), World A leading integrated steel and mining company, today announced results for the three and nine months ended September 30, 20211,2.
Note: As previously announced, starting in the second quarter of 2021, ArcelorMittal has revised the presentation of its reporting segment to report on the operations of AMMC and Liberia in the mining segment.The performance of other mines is accounted for in its main supplying steel division; from the second quarter of 2021, ArcelorMittal Italia will be split off and accounted for as a joint venture.
“Our third quarter results were supported by a continued strong price environment, resulting in the highest net income and lowest net debt since 2008. However, our safety performance outpaced this success. Improving the group’s safety performance is a priority This year we have significantly strengthened our safety procedures and will analyse what further interventions can be introduced to ensure we eliminate all fatalities.
“Early in the quarter, we announced ambitious CO2 reduction targets for 2030 and planned to invest in a variety of decarbonization initiatives. Our stated goal is to lead the steel industry to play an important role in ensuring the global economy achieves net zero emissions. That’s why we’re joining Breakthrough Energy Catalyst, working with the Science-Based Targets initiative to develop new approaches for the steel industry, and to support the Green Public Procurement campaign of the Deep Decarbonization of Industry initiative launched this week at COP26.
“While we continue to see volatility due to the persistence and impact of COVID-19, this has been a very strong year for ArcelorMittal. We have repositioned our balance sheet to With the goal of transitioning to a low carbon economy, we are growing strategically through high-quality, high-return projects, and we are returning capital to shareholders. We are aware of the challenges, but feel the opportunities that will exist for the steel industry in the coming years and beyond excited.”
“The outlook remains positive: underlying demand is expected to continue to improve; and, although slightly below recent all-time highs, steel prices are still at elevated levels, which will be reflected in annual contracts in 2022.”
Protecting the health and well-being of our employees remains the company’s top priority and continues to strictly adhere to World Health Organization guidelines (regarding COVID-19), with specific government guidelines being followed and implemented.
Health and safety performance based on own personnel and contractor Lost Time Injury Frequency (LTIF) for the third quarter of 2021 (“Q3 2021″) was 0.76x compared to the second quarter of 2021 (“Q2 2021″) At 0.89x. The prior period data for the sale of ArcelorMittal USA that occurred in December 2020 has not been recalculated and excludes ArcelorMittal Italia for all periods (now accounted for using the equity method).
Health and safety performance for the first nine months of 2021 (“9M 2021″) was 0.80x, compared to 0.60x for the first nine months of 2020 (“9M 2020″).
The company’s efforts to improve its health and safety record are aimed at enhancing the safety of its employees, with an absolute focus on eliminating deaths.Changes have been made to the company’s executive compensation policy to reflect this focus.
Analysis of results for Q3 2021 vs. Q2 2021 and Q3 2020 Total steel shipments in Q3 2021 were 14.6% due to weak demand (especially for autos) as well as production constraints and delays in order shipments tonnes, down 9.0% from 16.1 tonnes in Q2 2021 and is expected to reverse in Q4 2021.Adjusted for scope change (ie excluding ArcelorMittal Italy 11 shipments, unconsolidated from April 14, 2021) Steel shipments in Q3 2021 compared to Q2 2021 Down 8.4% over: ACIS -15.5%, NAFTA -12.0%, Europe -7.7% (range adjusted) and Brazil -4.6%.
Adjusted for scope change (i.e. excluding shipments of ArcelorMittal USA sold to Cleveland Cliffs on December 9, 2020 and ArcelorMittal Italia11 unconsolidated since April 14, 2021), Q3 2021 steel Shipments up 1.6% from Q3 2020: Brazil +16.6%; Europe +3.2% (range-adjusted); NAFTA +2.3% (range-adjusted); partially offsetting ACIS -5.3%.
Sales in the third quarter of 2021 were $20.2 billion, compared to $19.3 billion in the second quarter of 2021 and $13.3 billion in the third quarter of 2020.Compared with the second quarter of 2021, sales increased by 4.6% mainly due to higher realized average steel selling prices (+15.7%) and higher mining revenue mainly due to higher shipments (ArcelorMittal Mining Canada The company (AMMC7) resumed after resolving a strike action affecting operations in the second quarter of 2021).Sales in the third quarter of 2021 increased by +52.5% compared to the third quarter of 2020, mainly due to significantly higher average steel selling prices (+75.5%) and iron ore reference prices (+38.4%) .
Depreciation was $590 million in the third quarter of 2021 compared to $620 million in the second quarter of 2021, significantly lower than the $739 million in the third quarter of 2020 (due in part to the spin-off from mid-April 2021 ArcelorMittal Italy and the sale of ArcelorMittal U.S. starting in December 2020. Depreciation expense for fiscal 2021 is expected to be approximately $2.6 billion (based on current exchange rates).
There were no impairment items in the third quarter of 2021 and the second quarter of 2021.Net impairment gain for the third quarter of 2020 was $556 million, including a partial reversal of impairment charges recorded following the announced sale of ArcelorMittal U.S. ($660 million) and an impairment charge of $104 million In connection with the permanent closure of the blast furnace and steel plant in Krakow (Poland).
The $123 million special project in the third quarter of 2021 is related to the expected cost of decommissioning the dam at the Serra Azul mine in Brazil.There are no unusual items in Q2 2021 or Q3 2020.
Operating income for the third quarter of 2021 was $5.3 billion, compared to $4.4 billion in the second quarter of 2021 and $718 million in the third quarter of 2020 (subject to the unusual and impairment items described above).The increase in operating income in the third quarter of 2021 compared to the second quarter of 2021 reflects the positive price cost effect of the steel business, which more than offset the decline in steel shipments, as well as the improvement in the performance of the mining segment (driven by higher iron Ore shipments partially offset lower iron ore reference prices).
Revenue from associates, joint ventures and other investments in the third quarter of 2021 was $778 million, compared to $590 million in the second quarter of 2021 and $100 million in the third quarter of 2020.Q3 2021 was significantly higher due to improved performance from Canadian, Calvert5 and Chinese investees12.
Net interest expense in the third quarter of 2021 was $62 million, down from $76 million in the second quarter of 2021 and $106 million in the third quarter of 2020, primarily due to savings following bond repayments.
Foreign exchange and other net financing losses were $339 million in the third quarter of 2021, compared with $233 million in the second quarter of 2021 and $150 million in the third quarter of 2020.Q3 2021 includes foreign exchange gains of $22 million (compared to $29 million and $17 in Q2 2021 m Q3 2020 gains), and a call option related to mandatory convertible bonds Related non-cash market value loss of $68 million (2021 Q2 gain of $33 million).The third quarter of 2021 also included i) $82 million in charges related to the revised valuation of the put option granted to Votorantim18; ii) legal claims (currently pending on appeal) related to ArcelorMittal Brazil’s acquisition of Votorantim18 ) related to a $153 million loss (consisting primarily of interest and indexation charges, financial impact net of taxes and expected recovery of less than $50 million)18. Q2 2021 was impacted by a $130 million early bond redemption premium charge.
ArcelorMittal’s income tax expense was $882 million in the third quarter of 2021, compared with an income tax expense of $542 million in the second quarter of 2021 (including $226 million in deferred tax benefits) and the third quarter of 2020 $784 million for the quarter (including a $580 million deferred tax charge).
ArcelorMittal’s third-quarter 2021 net income was $4.621 billion ($4.17 basic earnings per share) compared to $4.005 billion ($3.47 basic earnings per share) in the second quarter 2021, 2020 Net loss for the third quarter of the year was $261 million (basic loss per common share of $0.21).
NAFTA segment crude steel production fell 12.2% to 2.0 t in Q3 2021, compared to 2.3 t in Q2 2021, mainly due to operational disruptions in Mexico (including the impact of Hurricane Ida).Adjusted range (excluding the impact of the sale of ArcelorMittal USA in December 2020), crude steel production fell -0.5% YoY.
Steel shipments in the third quarter of 2021 decreased by 12.0% to 2.3 tons compared to 2.6 tons in the second quarter of 2021, mainly due to the decline in production as mentioned above.After adjusting for the range, steel shipments increased by 2.3% year-on-year.
Sales in the third quarter of 2021 increased by 5.6% to $3.4 billion, compared to $3.2 billion in the second quarter of 2021, primarily due to a 22.7% increase in the average selling price of steel, partially driven by lower steel shipments. offset (as above).
There are zero impairments in the third quarter of 2021 and the second quarter of 2021.Operating income for the third quarter of 2020 included a gain of $660 million related to a partial impairment reversal recorded by ArcelorMittal USA following the announcement of the sale.
Operating income for the third quarter of 2021 was $925 million, compared to $675 million in the second quarter of 2021 and $629 million in the third quarter of 2020, which was positively impacted by the aforementioned impairment items, which were affected by the COVID-19 pandemic. offset.
EBITDA in the third quarter of 2021 was $995 million, an increase of 33.3%, compared to $746 million in the second quarter of 2021, primarily due to the positive price cost effect partially offset by lower shipments as described above.EBITDA in the third quarter of 2021 was higher than the $112 million in the third quarter of 2020, mainly due to a significant positive price cost effect.
Part of Brazil’s crude steel production fell by 1.2% to 3.1 t in Q3 2021, compared to 3.2 t in Q2 2021, and was significantly higher compared to 2.3 t in Q3 2020, when production was adjusted To match levels of declining demand driven by the COVID-19 pandemic.
Steel shipments in the third quarter of 2021 decreased by 4.6% to 2.8 tons compared to 3.0 tons in the second quarter of 2021, mainly due to lower domestic demand due to delays in orders at the end of the quarter that were not fully offset by export shipments .Steel shipments in the third quarter of 2021 increased by 16.6% compared to 2.4Mt in the third quarter of 2020, due to higher volumes of flat products (up 45.4%, driven by higher exports).
Sales in the third quarter of 2021 increased 10.5% to $3.6 billion, compared to $3.3 billion in the second quarter of 2021, as a 15.2% increase in steel average selling prices was partially offset by lower steel shipments.
Operating income for the third quarter of 2021 was $1,164 million, up from $1,028 million in the second quarter of 2021 and $209 million in the third quarter of 2020 (affected by the COVID-19 pandemic).Operating income in the third quarter of 2021 was impacted by $123 million in exceptional projects related to the expected cost of decommissioning the dam at the Serra Azul mine in Brazil.
EBITDA in the third quarter of 2021 increased by 24.2% to $1,346 million, compared to $1,084 million in the second quarter of 2021, primarily due to lower steel shipments partially offsetting the positive price cost effect.EBITDA in the third quarter of 2021 was significantly higher than the $264 million in the third quarter of 2020, mainly due to positive price cost effects and higher steel shipments.
Part of European crude steel production fell by 3.1% to 9.1 t in the third quarter of 2021 compared to 9.4 t in the second quarter of 2021.Following the formation of a public-private partnership between Invitalia and ArcelorMittal Italia, renamed Acciaierie d’Italia Holding (a subsidiary of ArcelorMittal ILVA business lease and purchase agreement), ArcelorMi Tal has started to split assets and liabilities starting in mid-April 2021.Adjusted for scope changes, crude steel production in the third quarter of 2021 decreased by 1.6% compared to the second quarter of 2021 and increased by 26.5% in the third quarter of 2021 compared with the third quarter of 2020.
Steel shipments fell by 8.9% to 7.6 t in Q3 2021 compared to 8.3 t in Q2 2021 (range-adjusted -7.7%), down from 8.2 t in Q3 2020 (range-adjusted -7.7%). +3.2% (adjusted) . Steel shipments in the third quarter of 2021 were impacted by weaker demand, including lower vehicle sales (due to late order cancellations), and logistics constraints related to the severe flooding in Europe in July 2021 .
Sales in the third quarter of 2021 increased 5.2% to $11.2 billion compared to $10.7 billion in the second quarter of 2021, primarily due to a 15.8% increase in average selling prices (flat products +16.2% and long products + 17.0%).
Impairment charges for the third quarter of 2021 and the second quarter of 2021 are zero.Impairment charges in the third quarter of 2020 were $104 million related to the closure of blast furnaces and steel mills in Krakow (Poland).
Operating income for the third quarter of 2021 was $1,925 million, compared to operating income of $1,262 million in the second quarter of 2021, and an operating loss of $341 million for the third quarter of 2020 (due to the aforementioned COVID-19 pandemic and impairment losses). Impact).
EBITDA in the third quarter of 2021 was $2,209 million, up from $1,578 million in the second quarter of 2021, primarily due to lower steel shipments partially offsetting the positive price cost effect.EBITDA increased significantly in the third quarter of 2021 compared to $121 million in the third quarter of 2020, primarily due to positive price cost effects.
Compared to the second quarter of 2021, the crude steel production of the ACIS segment in the third quarter of 2021 was 3.0 tons, which was 1.3% higher than that in the second quarter of 2021.Crude steel production in Q3 2021 was 18.5% higher compared to 2.5t in Q3 2020, mainly due to higher Ukrainian production in Q3 2021 and COVID-19 Q2 and Q3 2020 Related blockade measures implemented in South Africa during the quarter.
Steel shipments in Q3 2021 decreased by 15.5% to 2.4 tonnes compared to 2.8 tonnes in Q2 2021, mainly due to weak market conditions in the CIS and delayed shipments of export orders at the end of the quarter resulting in Kazakh Stan shipments fell.
Sales in the third quarter of 2021 decreased by 12.6% to $2.4 billion, compared to $2.8 billion in the second quarter of 2021, primarily due to lower steel shipments (-15.5%) partially offset by higher average steel selling prices (+7.2%).
Operating income for the third quarter of 2021 was $808 million, compared to $923 million in the second quarter of 2021 and $68 million in the third quarter of 2020.
EBITDA in the third quarter of 2021 was $920 million, down 10.9%, compared to $1,033 million in the second quarter of 2021, primarily as lower steel shipments were partially offset by price cost effects.EBITDA in the third quarter of 2021 was significantly higher than the $188 million in the third quarter of 2020, mainly due to lower steel shipments partially offsetting the positive price cost effect.
Given the December 2020 sale of ArcelorMittal USA, the company no longer covers coal production and shipments in its earnings report.
Iron ore production in Q3 2021 (AMMC and Liberia only) increased by 40.7% to 6.8 tonnes, compared to 4.9 tonnes in Q2 2021, down 4.2% compared to Q3 2020.The increase in production in the third quarter of 2021 was primarily due to a return to normal AMMC operations affected by the 4-week strike in the second quarter of 2021, partially offset by lower production in Liberia due to locomotive accidents and seasonal heavy monsoon rains the impact.
Iron ore shipments in the third quarter of 2021 increased by 53.5% compared to the second quarter of 2021, mainly driven by the aforementioned AMMC, and decreased by 3.7% compared to the third quarter of 2020.
Operating income increased to $741 million in the third quarter of 2021, compared to $508 million in the second quarter of 2021 and $330 million in the third quarter of 2020.
EBITDA in Q3 2021 increased by 41.3% to $797 million compared to $564 million in Q2 2021, reflecting the positive impact of higher iron ore shipments (+53.5%) partially offset by Shipping charges were offset by lower iron ore reference prices (-18.5%) and higher prices.EBITDA in Q3 2021 was significantly higher than the $387 million in Q3 2020, mainly due to higher iron ore reference prices (+38.4%).
Joint Venture ArcelorMittal has invested in several joint ventures and joint ventures around the world.The company believes that the Calvert (50% stake) and AMNS India (60% stake) joint venture is of particular strategic importance and requires more detailed disclosure to improve its operating performance and understanding of the company’s value.