4Q10 and 2010 Full Year Results Mr. Lakshmi Mittal, Chairman and CEO Mr. Aditya Mittal, CFO 8 February 2011
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, 2010 to be 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
Agenda Highlights of the results Steel market outlook Financial results and guidance 2
Corporate responsibility performance Annual Health & Safety frequency rate* for mining & steel 2.8 2.4 2.0 1.6 3.1 1.2 2.5 0.8 1.9 1.8 0.4 0.0 2007 2008 2009 2010 Quarterly Health & Safety frequency rate* for mining & steel Governance, people, community and sustainability initiatives: ArcelorMittal announces the launch of its responsible sourcing program ArcelorMittal unveiled the results of its 'S-in motion' automotive research program 2.0 1.6 ArcelorMittal Foundation 1.2 celebrates its 3rd International 0.8 1.9 1.9 1.7 1.9 1.6 Volunteer Work Day 0.4 0.0 4Q 09 1Q 10 2Q 10 3Q 10 4Q 10 ArcelorMittal s Health and Safety performance improved again in 2010 * IISI-standard: Fr = Lost Time Injuries per 1.000.000 worked hours; based on own personnel and contractors 3
Financial results EBITDA: Full year EBITDA of $8.5 billion (excl. $0.4 billion for Aperam), 52% higher than 2009 4Q 2010 EBITDA of $1.9 billion, including $0.1 billion from sale of CO 2 credits Shipments: Full year shipments of 85.0 Mt, 22% higher than 2009 4Q 2010 shipments of 21.1 Mt up 3% vs. 3Q 2010 Strong cash flow generation: Cash flow from continuing operations of $3.3 billion in 4Q 2010 ($3.8 billion for 2010) Full year capex of $3.3 billion, 22% higher than 2009 Net Debt reduced: $2.3 billion reduction in net debt to $19.7 billion compared to $22.1 billion at 3Q 2010 Full year 2010 EBITDA 52% higher than 2009 Note: Successful spin off of the stainless steel business (Aperam) following shareholders approval on January 25, 2011. Accordingly, results of the stainless steel operations in 4Q 2010 are shown as discontinued operations. Prior periods results and operational KPIs presented have been recast to reflect the new presentation. 4
Steel production and shipments ArcelorMittal quarterly crude steel production and steel shipments ( 000 t) 35,000 30,000 Steel production ('000 t) Steel shipment ('000 t) 25,000 20,000 15,000 10,000 5,000 0 1Q 08 2Q 08 3Q 08 4Q 08 1Q 09 2Q 09 3Q 09 4Q 09 1Q 10 2Q 10 3Q 10 4Q 10 While our steel production declined 3% in 4Q10 v 3Q10, our steel shipments increased by 3% 5
Mining production Annual iron ore production* (Mt) 50 Annual coal production* (Mt) 8.0 40 6.0 30 20 43.8 37.7 48.9 4.0 5.9 7.1 7.0 10 2.0 0 2008 2009 2010 Quarterly iron ore production* (Mt) 0.0 2008 2009 2010 Quarterly coal production* (Mt) 14 2.0 12 10 1.6 8 1.2 6 4 2 10 10.6 12.8 13.0 12.6 0.8 0.4 1.7 1.6 1.7 1.8 1.8 0 4Q 2009 1Q 2010 2Q 2010 3Q 2010 4Q 2010 0.0 4Q 2009 1Q 2010 2Q 2010 3Q 2010 4Q 2010 Own iron ore production of 48.9 Mt in 2010, up 29.9% as compared to 2009 * Excluding strategic agreement and long-term supply contracts 6
Market outlook 7
Contraction Expansion Global economic outlook positive Regional Purchasing Managers Indexes point towards demand growth 65 60 55 50 45 40 35 China EU USA 30 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Real demand continues to grow in all markets. Outlook for the US has improved 8
China outlook China Inventories in 25 Major Cities MT (end of Month) China Floor space (Million square metres) 18 16 14 Long Flat % of ASC (rhs) 45% 40% 35% 270 250 230 Floor Space under construction (12mma) Newly Started Construction (SA) 12 10 8 6 4 2 0 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 ASC refers to Apparent steel consumption; MMA refers to twelve months moving average 30% 25% 20% 15% 10% 5% 0% Current fundamentals remain solid We expect ~7% growth in ASC in China in 2011 210 190 170 150 130 110 90 70 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 9
Contraction Expansion US/Europe outlook US Architecture Billing index and Eurozone construction US & EU Stocks at service centres (2007=100) 65 60 USA Architecture Billings Index Eurozone Construction PMI 115 105 Europe (EASSC) USA (MSCI) 55 95 50 85 45 40 75 65 ` 35 55 30 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 45 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Current fundamentals remain solid Strong ABI index figures indicating US construction recovery 10
Financial results and guidance Mr. Aditya Mittal, CFO 11
Corporate actions: Baffinland acquisition In partnership with Nunavut, ArcelorMittal has acquired a controlling interest in Baffinland. The second-step going-private transaction will result in ArcelorMittal and Nunavut holding respectively interests of 70% and 30% in Baffinland Baffinland owns the Mary River project, a tier-1 iron ore resource in northern Canada. In-situ Fe grades of 64.7%, high-quality product, significant and scalable resource. While the project has development and operational challenges, ArcelorMittal is well placed to overcome them. Exploration is ongoing and feasibility studies will be updated ahead of a project scope decision. The acquisition of Baffinland is in line with ArcelorMittal s strategy of building a world-class mining business. Baffinland is not part of our 100Mt target. ArcelorMittal already has a significant iron ore presence in Canada through ArcelorMittal Mines Canada operating 2 iron ore mining operations, concentrator and pellet plant. Nunavut is located in Northern Canada and covers ~2Mkm2 of land. The territory includes part of the mainland, most of the Arctic Archipelago, and all of the islands in Hudson Bay, James Bay, and Ungava Bay which belonged to the NW Territories. Acquisition of Baffinland demonstrates commitment to building a world-class mining business 12
P&L highlights 4Q10 EBITDA to Net Loss (USD million) Net income/ (loss) (USD billion) Depreciation & impairment 1.1 0.6 1.7 1.4 1,853 1,456 397 Income from equity +74 Net Interest, FOREX & other -1,200 Income Tax Benefit Discontinued Operations and Noncontrolling interest Earnings/ (loss) per share (USD) -0.8 4Q 2009 1Q 2010 2Q 2010 3Q 2010 4Q 2010-729 -279-279 +450-501 -780 0.73 0.42 1.13 0.89 EBITDA Operating income Pre-tax Income/(Loss) from continuing operations Net loss -0.51 4Q 2009 1Q 2010 2Q 2010 3Q 2010 4Q 2010 Lower EBITDA and impairment charges resulted in a net loss of $0.8 billion for 4Q 10 In accordance with IFRS the Company has adjusted the 2009 financial information retrospectively for the finalization in 2010 of the allocation of purchase price for certain business combinations carried out in 2009. The adjustments have been reflected in the Company s consolidated financial statements for the year ended December 31, 2009 13
Cash flow highlights 4Q 10 Free cash flow (USD million) Capex (USD million) -424 2,139 Net financials, tax expenses and others -1,379 1,379 773 787 518 623 4Q 2009 1Q 2010 2Q 2010 3Q 2010 4Q 2010 Change in w orking capital 3,568 Capex Net acquisition spending (USD million) 1,853-805 2,189 499 EBITDA Cash flow from operations Free cash flow 237 127 52 Q4 2009 Q1 2010 Q2 2010 Q3 2010 Q4 2010 0 0 $3.6 billion cash provided from operations in 4Q 10 14
Guidance Production and shipments: Group shipment volumes are expected to increase from 4Q 2010, capacity utilization expected to rise to ~76% (vs. 69% in 4Q 2010) Selling prices: Average steel selling prices are expected to increase from 4Q 2010 as they adjust to rapid raw material increases Margin: EBITDA/tonne expected to increase from 4Q 2010 1Q 2011 EBITDA expected to be between $2.0 2.5 billion Working capital: to increase in 1Q 2011 due to increased activity levels Other: cash out to include acquisition of Baffinland Capex: full year capex to be $5.0bn, including $1.4bn in mining Net debt to increase in 1Q 2011 Note: starting effective 1Q 2011 we will begin reporting Mining as a separate segment 1Q11 EBITDA expected to improve with better market conditions despite higher costs 15
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