Third quarter 2009 Media Presentation. October 28, 2009

Transcription

1 Third quarter 2009 Media Presentation October 28, 2009

2 Disclaimer Forward-Looking Statements This document may contain forward-looking information and statements about ArcelorMittal and its subsidiaries. These statements include financial projections and estimates and their underlying assumptions, statements regarding plans, objectives and expectations with respect to future operations, products and services, and statements regarding future performance. Forward-looking statements may be identified by the words believe, expect, anticipate, target or similar expressions. Although ArcelorMittal s management believes that the expectations reflected in such forward-looking statements are reasonable, investors and holders of ArcelorMittal s securities are cautioned that forward-looking information and statements are subject to numerous risks and uncertainties, many of which are difficult to predict and generally beyond the control of ArcelorMittal, that could cause actual results and developments to differ materially and adversely from those expressed in, or implied or projected by, the forward-looking information and statements. These risks and uncertainties include those discussed or identified in the filings with the Luxembourg Stock Market Authority for the Financial Markets (Commission de Surveillance du Secteur Financier) and the United States Securities and Exchange Commission (the SEC ) made or to be made by ArcelorMittal, including ArcelorMittal s Annual Report on Form 20-F for the year ended December 31, 2008 filed with the SEC. ArcelorMittal undertakes no obligation to publicly update its forward-looking statements, whether as a result of new information, future events, or otherwise. 1

3 Agenda Introduction and overview Environment and steel market Industrial plan progress and new initiatives Q3 results and financial plan Guidance 2

4 Introduction and overview 3

5 Introduction and overview Highlights in Q Stable Health & Safety frequency rate Shipments of 18.2 million tonnes, up 7% compared to Q EBITDA of USD 1.6 billion, in line with guidance, up 30% compared to Q Net income of USD 0.9 billion in Q Cash-flow from operations of USD 2.4 billion in Q Industrial and financial plan; targets achieved ahead of schedule USD 2.2 billion of annualized sustainable cost reduction achieved as of Q Net debt reduced to USD 21.6 billion; down by USD 10.9 billion over last twelve months New initiative Selected growth projects reinitiated in some key emerging markets Guidance for Q EBITDA is expected to be between USD 2.0 USD 2.4 billion As anticipated we have seen first signs of recovery in the third quarter * Based on yearly average EBITDA since January 1,

6 Health and Safety Steel frequency rate* Q1 06 Q2 06 Q3 06 Q4 06 Q1 07 Q2 07 Q3 07 Q4 07 Q108 Q208 Q308 Q408 Q109 Q209 Q309 Stable health and safety performance in Q * IISI-standard: Fr = Lost Time Injuries per worked hours; based on own personnel 5

7 Environment and steel market 6

8 Strong underlying demand in China but short term destocking needed Crude steel production in China (y/y change %)* Chinese and Asian spot price for HRC** J-03 J-04 J-05 J-06 J-07 J-08 J J-03 J-04 J-05 J-06 J-07 J-08 J-09 HRC / China domestic FOB Shanghai (incl. 17% vat) $/t HRC / East Asia import CFR $/t Excess inventory expected to be corrected during Q * Source: WSA ** Source: SBB 7

9 Apparent demand recovery continues in the US Crude steel production in the US (y/y change %)* J-03 J-04 J-05 J-06 J-07 J-08 J-09 HRC North America domestic FOB US Midwest mill USD/short ton** J-03 J-04 J-05 J-06 Industry average cash cost J-07 J-08 J-09 Restocking has just been initiated * Source: WSA ** Source: SBB 8

10 Destocking completed in Europe Crude steel production in EU-27 (y/y change %)* HRC South Europe domestic Ex-Works Euro/t** J-03 J-04 J-05 J-06 J-07 J-08 J J-03 J-04 J-05 J-06 Industry average cash cost J-07 J-08 J-09 Apparent demand progressively improving to match real demand * Source: WSA ** Source: SBB 9

11 Industrial plan progress and new initiatives 10

12 Cautious production increase in line with demand ArcelorMittal quarterly crude steel production (million tonnes) Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Estimated crude steel production Realised crude steel production Capacity utilization expected to continue to increase gradually to approximately 70% in Q4 11

13 Sustainable management gains target achieved ahead of schedule Management gains progress (USD billion annualized) Fixed costs annualized (in billion USD) Target by end of 2010 Target by end of Captured at 31/12/08 Captured at 31/03/09 Captured at 30/06/09 Captured at 30/09/ Q Q Q Q Sustainable SG&A and fixed cost reduction Temporary fixed cost reduction Actual Fixed cost Despite good management gains progress, fixed costs increased in Q3 due to unfavourable currency effect and increase in production 12

14 Reinitiating some projects to capture growth in key emerging markets ArcelorMittal sales in value breakdown (Q3 2009) ArcelorMittal key emerging markets currently targeted for growth Emerging domestic 31% EU-15 37% Export to emerging 14% US & Canada 18% ArcelorMittal s leading position in emerging markets offers high growth potential 13

15 Q3 results and financial plan 14

16 P&L highlights EBITDA to Net Income (USD million) EBITDA (USD billion) Depreciation & impairment 8.6-1,284 Noncontrolling interest & Tax Q Q Q Q Q ,589 Earnings per share (USD) 305 Income from equity +99 FOREX, Net interest & other* EBITDA Operating income Pre-tax Net income 3Q Q Q Q Q 2009 EBITDA of USD 1.6 billion in-line with guidance * Includes mark-to-market on convertible bonds of USD (110) million 15

17 Balance sheet highlights Net Debt & Equity (USD billion) Net Debt (USD billion) and Net Debt/Average EBITDA* Ratio (x) Non-controlling interest Shareholders' Equity Equity 21.6 Net Debt Gearing of 34% within new target range of 25%-40% 35 Target range of 0.5x to 1.8x x Q Q Q Q Q Q Q Q Q Q Q Q 2009 Net Debt (USDbn) - LHS Net Debt / Average EBITDA (x) - RHS Net debt reduced by USD 1.3 billion to USD 21.6 billion * Based on yearly average EBITDA since January 1,

18 Pro forma liquidity and gross debt maturity Pro forma liquidity* & debt in current quarter (USD billion) Pro forma repayment schedule* (USD billion) Unused credit lines Cash & equivalent* Liquidity Debt due in Q4 09 Commercial paper Short term debt & Others Therafter Bond Term loans Convertibles Other debt Average debt maturity profile. extended to 4.3 years* * Includes 30-year bond of USD 1 billion priced on October 1,

19 Guidance 18

20 Fourth Quarter 2009 Guidance Volume Volumes to increase from Q Price Average steel price to increase from Q EBITDA expected to be between USD 2.0 billion USD 2.4 billion Cost Fixed costs to increase due to increase in activity Q EBITDA expected to improve 19

21 Q&A 20