Luxembourg-headquartered steel manufacturer ArcelorMittal today announced results for the three- and nine-month periods ended 30 September 2020.

Improved operating performance in the third quarter of 2020 reflected a gradual recovery in steel end markets (in particular automotive) following the severe impacts of COVID-19 lockdowns on economic activity in the second quarter as well as stronger mining segment performance. Operating income stood at $0.7bn in the third quarter (includding $0.6 billion net reversal of impairments), compared to an operating loss of $0.3bn in the previous quarter (which included $0.2 billion exceptional items).

The company's earnings before interest and taxes (EDITBA) were $0.9 billion in the third quarter, 27.4% higher than the previous quarter ($0.7 billion). This increase particularly reflects the impacts on the steel business of 17.5% higher shipments and an improved sales mix (proportionally more sales to automotive customers), offset in part by a negative price-cost effect, as well as the impacts of higher marketable iron ore prices (up 26.2%) and market priced iron ore shipments (up 7.5%) driving improved mining segment results.

ArcelorMittal reported a net loss of $0.3 billion in the third quarter of 2020 (compared to $0.6 billion in Q2), with an adjusted net loss of $0.2 billion excluding impairment items partially offset by deferred tax expense. Free cash inflow reached $1.3 billion in the third quarter of the year, including a working capital release of $1.1 billion. 

As of 30 September 2020, the company recorded a gross debt of $13.7 billion and a net debt of $7.0 billion. Net debt fell by $0.9 billion during the third quarter, mainly driven by positive free cash flow offset in part by forex impacts; net debt fell by $3.7 billion compared to $10.7 billion at the end of September 2019.

Commenting on the results, Lakshmi N. Mittal, ArcelorMittal Chairman and CEO, said: “The third quarter marked an improved operating performance for the Group with steel markets recovering gradually from the very challenging second quarter after the ending of lockdowns. All steel segments saw improved demand [...]. Our mining segment also delivered a strong performance taking advantage of the higher iron-ore price environment and outperforming production targets". He continued: "The quarter was also characterised by strong cash flow generation and the achievement of some important strategic milestones. In this very tough environment, we take considerable satisfaction from the fact that our deleveraging programme and asset disposal programme are now complete".

Mr Mittal added: "During the quarter we also announced a Group 2050 net zero target and the launch of a green steel product for the first time. We remain hopeful that we will start to see the introduction of the policy required to unlock potential and deliver real progress in the coming years".

The Chairman-CEO concluded: "The recent rise in COVID-19 cases worldwide makes it prudent to remain cautious about the outlook and we should be prepared for further volatility. However, our success to date in protecting our people, assets, profitability and cashflow throughout the crisis puts us in a good position to take advantage of further economic recovery".