ArcelorMittal Swings to Profitability in 2016; Plans Capital Spending Increase
02/10/2017 - Coming off its worst year since the 2006 merger that created it, ArcelorMittal recorded a US$1.8 billion profit in 2016 on an improving steel market and early savings in a turnaround initiative, reports the (London) Financial Times.
The profit is in stark contrast to 2015, when the world’s largest steelmaker posted a US$7.9 billion loss, the newspaper said.
“We enter 2017 with good momentum in the business and the market,” said Lakshmi Mittal, chairman and chief executive of ArcelorMittal. “The improvement in performance is, however, from a low base so we will need to continue to prioritize improved returns.”
With increased confidence in the steel market, the company said it plans to increase capital spending by US$500 million to US$2.9 billion this year.
About US$300 million of the increase will be put toward developing its steel operations, especially in Europe, where it intends to expand its ultra-high-strength steel capacity and hot-rolled coil and hot-dipped galvanized capacity.
“The focus here is on making sure we have the industrial capacity to supply our customers with the solutions we are developing, particularly in automotive. We are also investing across all the steel segments to improve and reduce costs," the company said.
“We enter 2017 with good momentum in the business and the market,” said Lakshmi Mittal, chairman and chief executive of ArcelorMittal. “The improvement in performance is, however, from a low base so we will need to continue to prioritize improved returns.”
With increased confidence in the steel market, the company said it plans to increase capital spending by US$500 million to US$2.9 billion this year.
About US$300 million of the increase will be put toward developing its steel operations, especially in Europe, where it intends to expand its ultra-high-strength steel capacity and hot-rolled coil and hot-dipped galvanized capacity.
“The focus here is on making sure we have the industrial capacity to supply our customers with the solutions we are developing, particularly in automotive. We are also investing across all the steel segments to improve and reduce costs," the company said.
