) posted a net loss of $1.2 billion or 69 cents per share in the
fourth quarter of 2013, narrower than a net loss of $3.8 billion
or $2.47 a year ago.
Barring one-time items (excluding impairment and restructuring
charges), loss was 31 cents per share, wider than the Zacks
Consensus Estimate of a loss of 16 cents per share.
Revenues rose 2.8% year over year to $19.8 billion in the
reported quarter but missed the Zacks Consensus Estimate of $20.1
billion. Sales also increased 1% sequentially due to improved
marketable mining shipments volumes. Steel shipments rose 4.5%
year over year to 20.9 million metric tons.
For full-year 2013, ArcelorMittal posted net loss of $2.5
billion, or $1.46 per share, lower than a net loss of $3.4
billion, or $2.17 per share. Barring one-time items (excluding
impairment and restructuring charges), loss was 90 cents per
The company's revenue decreased 5.7% to $79.4 billion in 2013
from $84.2 billion in 2012 mainly due to lower average steel
Flat Carbon Americas:
Production increased 5.4% year over year but declined 1.4%
sequentially to 6.3 million tons in the quarter. The sequential
decline was due to operational issues in Brazil and annual
maintenance in the company's Canadian operations. Average selling
prices went up 2.8% year over year to $819 per ton. Sales climbed
4.8% year over year and were almost flat sequentially at $4,906
million. Sales were impacted by lower shipments, partly offset by
higher average steel selling prices.
Flat Carbon Europe:
Revenues from this segment rose 7.1% year over year and 3.8%
sequentially to $6,576 million. The sequential increase in sales
was attributable to higher steel shipment volumes and higher
average steel selling prices. Average selling prices showed a
year-over-year decrease of 3.7% to $816 per ton. Production
increased 16.1% on a year-over-year basis but was almost flat
sequentially at 7.4 million tons.
Long Carbon Americas and Europe:
Revenues rose 2.3% year over year and 4.3% sequentially to $5,353
million due to higher average steel selling prices, mainly in the
Long Carbon Europe and Tubular businesses. Steel production
increased 6.9% from a year ago but declined 2.9% sequentially.
The sequential decline was due to lower production in the Long
Carbon Americas division. Average selling prices inched up 1%
from the prior-year quarter to $866 per ton.
Asia Africa and CIS (AACIS):
Sales dropped 8.5% from the year-ago quarter and showed a 7.7%
decrease from the previous quarter to $1,949 million. Lower steel
volumes and lower average steel selling prices led to the
sequential decline. Production recorded a 15% year-over-year
decline and was flat sequentially at 3.7 million tons. Average
selling prices were $589 per ton compared with $611 per ton in
the year-ago quarter.
Revenues declined almost 9.7% year over year but increased 1.6%
on a sequential basis to $3,481 million due to higher steel
shipment volumes. Average steel selling prices was flat year over
year at $833 per ton.
Iron ore production rose 10% year over year and 3.4% sequentially
to 15.4 million tons in the reported quarter due to increased
production from the Canadian mining operations. Coal production
remained flat both on year-over-year basis and sequentially at 2
million tons. Revenues climbed 26.7% year over year and improved
1.6% sequentially to $1,621 million.
Cash and cash equivalents (including restricted cash) amounted
to $6.2 billion as of Dec 31, 2013, compared with $4.5 billion as
of Dec 31, 2012. The company's long-term debt was $18.2 billion
as of Dec 31, 2013, down from $22 billion as of Dec 31, 2012.
In Nov 2013, ArcelorMittal announced that it has entered into
a 50:50 joint venture with Nippon Steel & Sumitomo Metal
Corporation to buy 100% of ThyssenKrupp Steel USA from
ThyssenKrupp for $1,550 million. The acquisition, which is
subject to closing conditions, is expected to close in
ArcelorMittal expects earnings before interest, taxes,
depreciation and amortization (EBITDA) to be about $8 billion for
2014. The company expects net interest expense to be roughly $1.6
billion in 2014, down from $1.8 billion in 2013 mainly due to
lower average debt.
Capital expenditure is expected to be in the range of $3.8-$4
billion in 2014, a modest increase from 2013, with some of the
expected spending from last year rolling into this year as well
as the continuation of the phase II Liberia project. The company
maintains its medium-term net debt target of $15 billion
Net debt in the first quarter of 2014 is expected to increase
due to investment in working capital as well as the announced
redemption of the perpetual bond ($650 million).
During the investor day held in Mar 2013, the company
announced a new management gain improvement target of $3 billion
by the end of 2015. As of Dec 31, 2013, $1.1 billion of
improvements had been achieved on an annualized run-rate
ArcelorMittal currently holds a Zacks Rank #2 (Buy).
Other companies in the steel industry with favorable Zacks
Companhia Siderurgica Nacional
United States Steel Corporation
). All three hold a Zacks Rank #1 (Strong Buy).
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