ArcelorMittal announced its highest quarterly profit since 2008, as the rise in steel prices helped the world’s largest producer to get rid of weak demand from automakers.
The Luxembourg-based group’s profit in the third quarter was US$6.1 billion, 19.9% higher than the second quarter and the highest record since 2008, but slightly lower than analysts’ expectations.
Net debt fell to US$3.9 billion this quarter, the lowest level since 2008. Sales are also higher, at 20.2 billion U.S. dollars.
The company will add another $1 billion in share repurchases, bringing the capital return announced since September 2020 to $6 billion.
Although due to weak demand, especially weak demand from automotive customers, as well as production restrictions and delays in order delivery, total steel shipments in the last three months fell by 9% compared with the second quarter of this year to 14.6 million tons, but Still achieved strong results. ArcelorMittal stated that these are expected to reverse in the fourth quarter.
Western steel producers have been enjoying their best year in the past decade, during which time many factories closed and layoffs due to sluggish demand. The global economic recovery after the pandemic has helped drive demand for steel, and supply constraints have also boosted prices.
CEO Aditya Mittal said that the company expects potential demand to continue to improve.
“The outlook remains optimistic: potential demand is expected to continue to improve; and, although slightly lower than recent historical highs, steel prices are still at a relatively high level, which will be reflected in the annual contract in 2022,” he said.