Investor presentation May 2015
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 documents filed with or furnished to the Luxembourg Stock Market Authority for the Financial Markets (Commission de Surveillance du Secteur Financier) and the U.S. Securities and Exchange Commission (the SEC ). ArcelorMittal undertakes no obligation to publicly update its forward-looking statements, whether as a result of new information, future events, or otherwise. Non-GAAP Measures This document may include supplemental financial measures that are or may be non-gaap financial measures, as defined in the rules of the SEC. They may exclude or include amounts that are included or excluded, as applicable, in the calculation of the most directly comparable financial measures calculated in accordance with IFRS. Accordingly, they should be considered in conjunction with ArcelorMittal's consolidated financial statements prepared in accordance with IFRS, which are available in the documents filed or furnished by ArcelorMittal with the SEC, including its annual report on Form 20-F and its interim financial report furnished on Form 6-K. A reconciliation of non-gaap measures to IFRS is available on the ArcelorMittal website. 1
Agenda Leadership Markets Strategic progress Outlook 2
Steel industry s differentiating factors Local markets structure counts key regional markets have consolidated Steel is not a homogenous commodity but a vast range of products with varying degrees of technicality Steel consumers value (and reward) service, quality and innovation Zero incentive to build new capacity value of installed capacity will increase with demand China exports peaked? negative for iron ore but positive for non- Chinese steel producers Has sentiment bottomed? upside from improvement Steel presents a differentiated opportunity to pure commodity metals 3
ArcelorMittal is the industry leader Safety is the No1 priority Steel is the primary driver of profitability Steel shipments 2014 Supported by a sustainable iron ore business Developed markets are core Rest of World Capacity to capitalise on demand recovery Optimized asset base in Europe with developing plans for the US Europe & NAFTA Primary position in global automotive Balance sheet repositioned ArcelorMittal positioned to benefit from demand recovery and own actions 4
Leader in steel for automotive ArcelorMittal is the leading global steel solution provider to the global automotive industry Unrivalled reputation for quality and innovation Steel set to remain material of choice for automotive industry Continued investment in R&D producing award winning automotive solutions Focused investment to capture growth opportunities: Calvert acquisition a break-through for NAFTA automotive franchise JV VAMA in China Dofasco S-In-Motion for Pickup Trucks: Launched 2014 2015 Kia Carnival 76% advanced high strength steel The leading provider of steel solutions to the global automotive sector 5
Footprint optimization delivering results European footprint optimization launched in 2011 Principle was to maintain market share whilst orientating capacity to most competitive sites Focus on core assets to ensure lowest cost footprint achieved Savings through fixed cost removal with well loaded assets with stable working points Lower variable cost Lower and more stable working capital requirements Better service and quality Reduce capex requirements >$1bn savings achieved through European footprint optimization Similar plans under development for US asset base European asset optimization yielding $1 billion annualized cost savings 6
Demand has improved EU28 Apparent steel consumption (Mt) 150 148 +6% 146 144 142 0 2013 2014 2015F Steel demand in Europe is recovering but remains well below pre-crisis levels* * ArcelorMittal estimates 7
Spreads have improved Spread between North Europe domestic HRC price and international RM Basket*, /t 178 +24% 208 220 2013 2014 1Q15 Steel prices have increased relative to underlying raw materials * RM Basket in HRC = 1.6 X IO (delivered to China)+ 0.6 X HCC (delivered to China)+ 0.15 X Scrap ( HMS 1/2 80:20 / East Asia import) Source: Platts, SBB, ArcelorMittal Corporate Strategy team analysis 8
Profitability has improved ArcelorMittal Europe segment EBITDA* ($mn) +42% 2,304 535 +15% 616 1,621 420 2013 2014 1Q 13 1Q 14 1Q 15 * Refer to appendix Improving spreads are translating into improving profitability 9
Markets Continued growth in developed markets Global apparent steel consumption (ASC)* (million tonnes per month) US and European apparent steel consumption (ASC)** (million tonnes per month) 65 55 Developing ex China China Developed 19 17 15 EU28 USA 45 13 11 35 9 25 7 15 (latest data point:mar 15) Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 May-14 Sep-14 Jan-15 5 3 Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Jan-12 May-12 (latest data point: Mar 15) Sep-12 Jan-13 May-13 Sep-13 Jan-14 May-14 Sep-14 Jan-15 Global ASC +0.3% in 1Q 15 vs. 4Q 14 Global ASC -1.4% in 1Q 15 vs. 1Q 14 China ASC +1.2% in 1Q 15 vs. 4Q 14 China ASC -4.8% in 1Q 15 vs. 1Q 14 US ASC -6.1% in 1Q 15 vs. 4Q 14 US ASC +2.1% in 1Q 15 vs. 1Q 14 EU28 ASC +12.3% in 1Q 15 vs. 4Q 14 EU28 ASC -1.3% in 1Q 15 vs. 1Q 14 1Q 15 growth still positive YoY in US, largely stable in EU28 and declining in China * ArcelorMittal estimates; ** AISI, Eurofer and ArcelorMittal estimates 10
750 700 650 600 550 500 450 400 350 300 250 200 Expansion US Residential Non-residential Jan-02 Jul-02 Jan-03 Jul-03 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 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14 Jul-14 Jan-15 65 60 55 50 45 US construction growth continues US residential and non-residential construction indicators (SAAR) $bn* Eurozone and US construction indicators** (latest data point: Jan 15) Eurozone construction PMI USA Architectural Billings Index In the United States: Architecture Billings Index (ABI) at 51.7 continues to indicate growth in Nonresidential investment. However, the low oil price has negatively impacted energy related investment. In Europe: Construction output began to grow in 2014 after declining strongly in both 2012 and 2013. Despite relatively weak confidence, we expect growth to gradually improve through 2015. Contraction 40 35 30 (latest data point: Mar 15) Jan-06 Apr-06 Jul-06 Oct-06 Jan-07 Apr-07 Jul-07 Oct-07 Jan-08 Apr-08 Jul-08 Oct-08 Jan-09 Apr-09 Jul-09 Oct-09 Jan-10 Apr-10 Jul-10 Oct-10 Jan-11 Apr-11 Jul-11 Oct-11 Jan-12 Apr-12 Jul-12 Oct-12 Jan-13 Apr-13 Jul-13 Oct-13 Jan-14 Apr-14 Jul-14 Oct-14 Jan-15 Construction gradually improving * Source: US Census Bureau; ** Source: Markit and The American Institute of Architects 11
Sustainable iron ore business Centred around Mines Canada a tier one operation AMMC iron ore production (MMt) +72% AMMC concentrate cost index -38% 15 18 23 26 2012 2013 2014 2015F 2013 2014 2015F Aggressive cost improvements 12
Improved cash conversion Capex down $1.7bn Net interest down $0.5bn Capex expense (US$bn) Net interest expense (US$bn) 4.7-36% 1.9 1.8-25% 3.5 3.7 3.0 1.5 1.4 2012 2013 2014 2015F 2012 2013 2014 2015F Cash breakeven level transformed Cash Flow expected to improve with EBITDA 13
Recent performance 1Q 15 EBITDA of $1.4bn (includes $0.1bn onerous contracts)* Ex-Mining Segment, Underlying EBITDA stable YoY* Steel shipments +3.0% YoY Own iron ore production +5% YoY Iron ore unit cash costs down 13% YoY FY 15 capex expectation lowered to approx. $3.0bn Net debt at end of 1Q 15 of $16.6bn, compared to $18.5bn at end of 1Q 14 EBITDA impacted by lower iron ore prices; Steel-only margins stable YoY * Underlying basis; EBITDA in 1Q 15 includes the negative impact a $69m provision related to onerous hot rolled and cold rolled contracts in the US. 14
Cash flow performance and liquidity Strong liquidity ($bn) 8.8 Net debt* progress ($bn) -10% Cash 2.8 18.5 Bank lines 6.0 16.6 15.0 At March 31, 2015 1Q 14 1Q 15 Medium term target $6bn lines of credit refinanced and extended in April; two tranches: $2.5bn matures April 2018 $3.5bn matures April 2020 Covenant of Net Debt / LTM** EBITDA of 4.25x Average debt maturity 6.4 Yrs Seasonal net debt increase in 1Q 15 due to investment in working capital Net debt $1.9bn lower than 12 months ago Net debt benefiting from lower interest expenses, capex reductions and working capital focus Recovering the investment grade credit rating remains a strategic priority * Net debt refers to long-term debt, plus short term debt, less cash and cash equivalents, restricted cash and short-term investments (including those held as part of asset/liabilities held for sale); ** LTM: refers to last twelve months. 15
Core market recovery expected to continue EU28 Medium term ASC forecast* USA Medium term ASC forecast* 160 April 2015 forecast April 2013 forecast 116 April 2015 forecast April 2013 forecast 155 112 150 108 145 104 100 140 0 2012 2013 2014 2015 2016 2017 2018 0 2012 2013 2014 2015 2016 2017 2018 Capacity to capture share of continued demand recovery in core markets * ArcelorMittal estimates 16
Takeaways ArcelorMittal is the leader in the differentiated steel industry ArcelorMittal is the leader in steel for automotive and will continue to invest to capture the opportunities The learning's of footprint optimisation in Europe will be applied to the US asset base The demand recovery in Europe is driving improved steel spreads and profitability Clear progress has been achieved on mining costs, cash conversion and repositioning the balance sheet Positive outlook for core developed markets 17
Q&A
New ArcelorMittal IR app and contacts Daniel Fairclough Global Head Investor Relations daniel.fairclough@arcelormittal.com +44 207 543 1105 Hetal Patel UK/European Investor Relations hetal.patel@arcelormittal.com +44 207 543 1128 Valérie Mella European/Retail Investor Relations valerie.mella@arcelormittal.com +44 207 543 1156 Maureen Baker Fixed Income/Debt Investor Relations maureen.baker@arcelormittal.com +33 1 71 92 10 26 Lisa Fortuna US Investor Relations lisa.fortuna@arcelormittal.com +312 899 3985 We have released a new ArcelorMittal investor relations app. You should be able to download the app from itunes or on an android device (link below). Here're the 2 links to download the product: Android: https://play.google.com/store/apps/details?id=com.arcelormittal.ir ios: https://itunes.apple.com/in/app/arcelormittal-ir-app/id988354136?mt=8