Second Quarter 2018 Questions and Answers

Second Quarter 2018 Questions and Answers Page 1

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 forwardlooking 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 latest Annual Report on Form 20-F on file 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. Page 2

Operating performance: 1. How did steel shipments change in the current quarter? Total steel shipments in 2Q 2018 were 1.8% higher at 21.8Mt as compared with 21.3Mt for 1Q 2018 primarily due to higher steel shipments in Brazil (+14.0%), NAFTA (+4.4%), and ACIS (+1.0%), offset in part by lower steel shipments in Europe (-1.7%). NAFTA steel shipments increased by 4.4% driven primarily due to improved market demand in the US. Brazil steel shipments increased by 14.0% to 2.8Mt as compared to 2.5 Mt in 1Q 2018, primarily due to a seasonal increase in flat product steel shipments (primarily export) and long products. 2Q 2018 steel shipments were positively impacted by the scope effect of the Votorantim acquisition net of divestments (0.2Mt), and adversely impacted by a nationwide truck strike (0.1Mt). Europe steel shipments decreased by 1.7% to 10.5Mt as compared to 10.7Mt in 1Q 2018, primarily because of floods in Asturias, Spain and impacted by the rail strikes in France. ACIS steel shipments increased by 1.0% to 3.1Mt as compared to 3.0Mt in 1Q 2018, primarily due to higher steel shipments in Kazakhstan offset in part by lower Ukrainian steel shipments (negatively impacted by operational issues). 2. How did average steel selling prices change this quarter? Average steel selling prices (ASP) were +2.1% higher this quarter as compared to 1Q 2018 due to improved prices in NAFTA (+9.4%) and ACIS (+1.9%) offset in part by decline in Brazil (- 3.2%). NAFTA: ASP increased +9.4%, for both flat products (+10.0%) and long products (+7.9%). ACIS: ASP increased +1.9%. Europe: ASP was stable QoQ and increased 3.1% in local currency terms. Brazil: ASP decreased -3.2% (primarily due to currency effects as local currency ASP increased +6.3%). 3. How did market-priced iron ore shipment volumes change this quarter? Market-priced iron ore shipments in 2Q 2018 increased by +9.3% to 10.0Mt as compared to 9.1Mt in 1Q 2018, primarily driven by higher shipments in AMMC and Ukraine. 4. How did operating income change relative to the prior period? Operating income for 2Q 2018 of $2.4 billion was higher as compared to $1.6 billion for 1Q 2018 due to: NAFTA: Operating income was higher primarily due to significant positive price-cost effect and higher steel shipment volumes. Brazil: Operating income in 2Q 2018 was higher at $369 million as compared to $215 million in 1Q 2018 primarily due to improved volumes and positive price-cost effect. Operating Page 3

income in 1Q 2018 was impacted by impairment of $86 million related to the agreed remedy package for the Votorantim acquisition (Cariacica and Itaúna industrial plants in Brazil). Europe: Operating income was higher primarily due to positive price-cost effect offset in part by lower steel shipment volumes and foreign exchange translation impact. Operating income in 1Q 2018 was impacted by exceptional charges of $146 million related to a provision taken in respect of a case that has now been settled. ACIS: Operating income increased primarily due to a positive price-cost impact. Mining: Operating income was lower primarily due to decreased seaborne iron ore reference prices (-11.3%) offset in part by higher market-priced iron ore shipments (+9.3%). 5. What is the depreciation expectation for 2018? Depreciation for 2Q 2018 was stable at $712 million as compared to 1Q 2018. Depreciation is expected to be $2.9 billion in 2018 (based on current exchange rates). 6. What is the net interest expectation for 2018? Net interest expense was lower in 2Q 2018 as compared to 1Q 2018 and 2Q 2017, primarily due to debt repayments and lower cost of debt. Net interest is expected to decline to $0.6 billion from $0.8 billion in 2017 reflecting the benefits of liability management exercises completed in 2017. 7. What did the tax change this quarter? ArcelorMittal recorded an income tax benefit of $19 million for 2Q 2018 as compared to an income tax expense of $203 million for 1Q 2018. The tax benefit of 2Q 2018 is the result of recording a deferred tax asset primarily due to expectation of higher future profits mainly in Luxembourg. Guidance: 8. What is the outlook for steel demand in 2018? Based on year-to-date growth and the current economic outlook, ArcelorMittal expects global apparent steel consumption (ASC) to grow further in 2018 by between +2.0% to 3.0% (up from +1.5% to +2.5% previous expectation). By region: ASC in US is expected to grow +2.0% to +3.0% in 2018 (up from previous expectation of +1.5% to +2.5%, driven by demand in machinery and construction). In Europe, the strength in machinery and construction end markets is now expected to support ASC growth of between +2.0% to +3.0% in 2018 (up from previous expectation of +1.0% to +2.0% growth). In Brazil, our 2018 ASC forecasts have been slightly moderated to growth in a range of +5.5% to 6.5% (from previous expectation of +6.5% to +7.5%) to reflect the impacts of the nationwide truck strike and more cautious sentiment ahead of the elections. In the CIS, ASC is still expected to grow +2.0% to +3.0% in 2018 reflecting strong consumption, particularly a rebound in auto sales and production in Russia. Overall, World ex-china ASC is still expected to grow by approximately +3.0% to +4.0% in 2018. Page 4

In China, overall demand is expected to now grow by between +1.0% to +2.0% in 2018 (up from previous expectation -0.5% to +0.5%), as real estate demand continues to surprise on the upside and ongoing robust machinery and automotive demand offset in part by a slowdown in infrastructure. 9. Can you provide details on market-priced iron ore shipments growth expectations in 2018 vs. 2017? Market-priced iron ore shipments are expected to increase in 2018 by approximately 10% YoY. In Liberia, the transition to Gangra deposit has been completed and Liberia iron ore shipments are expected to increase from 2Mt to 5Mt in 2018. 10. Is there an update on the cash needs of the business for 2018? The Company expects that cash needs of the business (excluding working capital investment and exceptional one-time impact of $0.2 billion in respect of a litigation case now settled) will total approximately $5.8 billion in 2018 (from the $5.6 billion previous estimate. The main changes to this guidance are as follows: Capex is now expected to total $3.7 billion (from $3.8 billion previously) largely reflecting the delayed completion of the ILVA acquisition; net interest is expected to be $0.6 billion (no change from previous guidance) reflecting the benefits of liability management exercises completed in 2017; other cash needs are now expected to total $1.5 billion (an increase from the previous guidance of $1.2 billion) due to expected higher cash taxes. 11. What is the working capital expectation for 2018? During 2Q 2018, ArcelorMittal invested $1.2 billion of working capital bringing 1H 2018 spend to $3.1 billion reflecting strong operating conditions and driven by the effect of higher steel shipments, higher average steel selling prices and higher inventory prices. Working capital movement for the remainder of 2018 will be driven by market conditions and how prices evolve between now and December 2018. Raw materials: 12. What is your outlook for iron ore and coking coal prices? As a major buyer and seller of steel making raw materials, we do not comment publicly on the outlook for raw material prices. For iron ore, ArcelorMittal is focused on its cost base where it has made significant progress over recent years and to looks to maximize value in use through product quality, service and delivery. As a result, the price level at which the Mining business is free cash flow breakeven (FCF) remains at $40/t China CFR 62% Fe. Balance sheet: 13. How has net debt changed this quarter as compared to 1Q 2018? Net debt decreased by $0.6 billion to $10.5 billion this quarter primarily due to a positive free cash flow of $0.6 billion despite $1.2 billion working capital investment, positive foreign exchange impacts on Euro-denominated debt ($0.4 billion) offset in part by incremental debt of M&A ($0.2 billion) and dividends ($0.1 billion). 14. Can you provide an update on your liquidity position? Page 5

As of June 30, 2018, ArcelorMittal had liquidity of $8.6 billion, consisting of cash and cash equivalents (including restricted cash and short-term investments) of $3.1 billion and $5.5 billion of available credit lines. 15. Can you provide an update on your ratings? ArcelorMittal has achieved its financial priority of an investment grade credit rating following upgrades from all 3 credit rating agencies in 2018 (S&P on February 1, 2018, Moody s on June 22, 2018 and Fitch on July 13, 2018). Capital allocation: 16. Can you provide an update on your capital allocation policy? The Company will continue to prioritize deleveraging until it achieves its target net debt level of $6 billion, as announced in January 2018. Whilst the Company s bias for surplus cash allocation continues to be debt reduction, the Company is capitalizing on opportunities to invest with focus and discipline to improve future returns for shareholders. The Company resumed dividends to shareholders paying a $0.10/share dividend in May 2018 (paid in June 2018 from 2017 results). Once it achieves net debt at or below its target, the Company is committed to increase shareholders returns, to reflect a proportion of annual free cashflow. 17. Why are you waiting for further deleveraging before a more substantial payout is made? ArcelorMittal is prioritizing deleveraging so that once it achieves its net debt target of $6 billion, and begins returning more significant amounts of capital returns to shareholders, the Company believes that shareholders will have greater confidence in the sustainability of those returns. 18. What is the update on the Company s strategy regarding M&A? The Company continues to make progress with its asset portfolio. In 2Q 2018 we completed the Votorantim acquisition to become the number one long steel producer in Brazil. We are now working to complete the acquisition of Ilva. At the same time, we are looking to participate in the compelling steel demand outlook and high growth opportunities in India, by submitting a JV agreement with Nippon Steel to acquire Essar Steel India. 19. What is latest update on the Group s acquisition of Ilva? On May 7, 2018, ArcelorMittal announced that it has been granted merger clearance by the European Commission (EC) for AM Investco Italy Srl (AM Investco) s proposed acquisition of Ilva S.p.A (Ilva). EC merger clearance follows the conclusion of the Commission s Phase II investigation into the proposed acquisition of Ilva, and has been granted on the basis that the Company has committed to dispose of assets in the divestment package. Approval by the EC is a significant milestone in the transaction to acquire Ilva and represents a major step towards closing the deal. The divestment package includes following assets: ArcelorMittal Piombino, the Company's only galvanized steel plant in Italy Page 6

ArcelorMittal Galati, Romania ArcelorMittal Skopje, Macedonia ArcelorMittal Ostrava, Czech Republic ArcelorMittal Dudelange, Luxembourg Hot dipped galvanizing lines 4 and 5 in Flemalle; hot-rolled pickling, cold rolling and tin packaging lines in Tilleur, all of which are in Liège, Belgium. In late June 2018, the government-appointed trustees overseeing the insolvency liquidation of Ilva extended to September 15, 2018 the deadline for the fulfilment of all the conditions precedent to the completion of the contract with ArcelorMittal for the lease and subsequent purchase of Ilva s assets. ArcelorMittal is committed to the rehabilitation of Ilva, in particular, addressing its environmental, social and industrial challenges, to reposition Ilva as one of Europe's premier steel facilities. 20. What is the expected accounting treatment of Ilva? Following completion of the acquisition, ArcelorMittal will fully consolidate Ilva. The purchase price of 1.8 billion will be recognized on the balance sheet as a payable, reduced by the quarterly instalments of 45 million that will flow through investing activities in the cash flow statement until legal transfer of ownership occurs (minimum 2 years). The new Ilva business will be transferred with approximately 1.0 billion of net working capital and free of long term liabilities and financial debt. Upon completion, ArcelorMittal will immediately commence the industrial turnaround plan, which includes a 2.4 billion investment programme. This comprises 1.1 billion environmental capital expenditure (of which 0.3 billion environmental remediation (clean-up) will be financed with funds seized from the Riva Group) and 1.3 billion industrial capex. Finally, Ilva is expected to be accretive to ArcelorMittal EBITDA in year 1 and accretive to cash flow in year 3 (as communicated in June 16, 2017 assuming 2016 market conditions). 21. Could you please provide us with an update on your strategy in India? The Indian steel market remains a very attractive market for ArcelorMittal. Whilst steel demand in India has been growing for a number of years, steel consumptions per capita is still amongst the lowest globally. The International Monetary Fund (IMF) expects India to be one of the world s fasting growing economies and continue to need and consume steel. As the requirements for the Indian customer base will develop and become more sophisticated as the economy develops (for example automotive steel growth is forecast to rise sharply), this is well suited to ArcelorMittal s strong product offering and industry leading R&D capabilities. The combination of these dynamics makes the Indian market highly attractive to ArcelorMittal. ArcelorMittal has signed a non-binding term sheet with SAIL for its proposed automotive steel joint venture, which the Company hopes will form the basis for signing a definitive agreement in the near future. The Company has also bid for Essar Steel (see details below). 22. Why are you interested in Essar steel? Essar Steel provides ArcelorMittal with a compelling opportunity to enter the high-growth India steel market. We choose Essar Steel for several factors: firstly, due to its large size, Essar is a Page 7

large plant West coastal based facility, with name plate capacity of over 9 million tonnes per annum (Mtpa); it has extensive pelletizing opportunities on the East coast of India; ArcelorMittal can leverage its experience in turning around underperforming steel assets; and lastly, the plant offers strong significant growth and optionality. 23. What is your vision for Essar Steel? Our vision is to fully realize the potential of Essar, by growing its steelmaking capabilities and by expanding and improving its product range. ArcelorMittal will need to bring Essar s performance in line with global standards, bringing world-class steelmaking and R&D knowledge, securing significant level of employment and transforming Essar. This will involve a multi staged approach: initial steps will be to stabilize the operation and increase production from current 6.6Mtpa level to 8.5Mtpa in the medium term and ultimately have long term aspirations to produce between 15-20Mtpa. 24. Could you please provide us with an update on the status of your bid for Essar? We, with our partner Nippon Steel and Sumitomo Metal, continue to believe that we are not only eligible to bid for Essar Steel but we are also the best qualified. Our global R&D across 12 countries, our technology and our deep and unrivalled expertise makes us the right partner for Essar and India. In February 2018, ArcelorMittal India Private Limited, a subsidiary of ArcelorMittal, submitted a competitive resolution plan for Essar Steel India Limited (ESIL). The resolution plan set out a detailed industrial plan for ESIL aimed at improving its performance and profitability, and ensuring it can participate in the anticipated growth of steel demand in India. The process has faced various legal challenges at the National Company Law Tribunal, and more recently at the National Company Law Appellate Tribunal (NCLAT). The NCLAT hearing concluded on July 18, 2018, and a ruling is expected in August 2018, which should provide further clarity on the ESIL insolvency process. Other topic: 25. What is the current situation regarding trade actions in US and Europe? In the US, we have Anti-Dumping (AD) and Anti Subsidy (AS) duties in place on all four flat product categories: CORE, CRC, HRC and plate. These measures are in place for five years from determination. The Department of Commerce (DOC) made final affirmative determinations in the anti-circumvention investigations for CRC and CORE imported (through Vietnam) on May 16, 2018. On June 12, 2018, the US industry filed anti-circumvention petitions with DOC for CRC and CORE imported from Korea and Taiwan (through Vietnam). Following its Section 232 investigation, imposition of 25% tariffs imposed on all steel imports entering the US began on March 23, 2018. Subsequently the US entered negotiations for exemptions of imports by several countries focusing on quotas that will restrain imports, prevent transshipment, and protect the national security. Effective June 1, 2018, a 25% tariff was imposed on steel products in Europe, Canada and Mexico with following exemptions: South Korea: The Administration has reached a final agreement with South Korea on steel imports (agreed to quota of 70% of 2015-2017 average export volumes into US). Page 8

Argentina: Quota agreed for 135% of the 2015-2017 average export volumes into US. Australia: completely exempt from tariffs and quotas. Brazil: Agreed quota of 70% of 2015-2017 average export volumes into US for finished products and 100% of 2015-2017 average export volumes into US for semi-finished products). There is a product exclusion process in place, which can only be initiated by steel users (individuals or organizations) in the US, for specific product categories and grades. In Europe, for the key flat product cases we have final AD duties on CRC against China and Russia, final AD and AD\S duties on HRC against China and final AD duties on QP against China. The European Commission announced in October 2017 fixed AD duties on imports of HRC (duties from 17.6/t to 96.5/t) from Brazil, Iran, Ukraine and Russia. HDG non-auto final AD duties against China announced in December 2017 ranging from 17.2% to 27.9%. On July 19, 2018 EU commission initiated provisional safeguard duties on 23 products (5 excluded from original investigation). A 100% quota based on average imports volumes between 2015-2017 has been implemented. The tariff rate quotas will be in operation for a maximum of 200 calendar days (February 4, 2019), and should be set at a corresponding prorata level to the annual figure. Imports exceeding the above quotas would face a 25% tariff. Page 9