ArcelorMittal produced an improved set of financial results year-on-year in the first quarter of 2018. Sales grew strongly while Ebitda for the period also increased. Net income also rose firmly on the same comparison. Net debt at the period end was also lower y-o-y, Kallanish notes.

“The improvement in global steel market dynamics has continued into 2018, supporting an encouraging financial performance in the first quarter. Ebitda increased 13% year-on-year to $2.5 billion, while net income improved by 19% to $1.2 billion. The outlook for 2018 has strengthened as the year has progressed, with the combination of growing demand and supply-side reform driving higher capacity utilisation rates and healthy steel spreads globally. Against this improving backdrop, we continue to focus on structural improvement - through the delivery of our Action 2020 strategic plan - and investing with focus and discipline in opportunities that will drive higher future returns. Our acquisition of Ilva has now received competition clearance from the European Commission and we expect to complete this acquisition by the end of the second quarter 2018,” says chairman and ceo Lakshmi Mittal in his comments on the results.

In its outlook the steelmaker says that global apparent steel consumption (ASC) is estimated to have expanded by 3.2% in 2017. Based on the current economic outlook, ArcelorMittal expects global ASC to grow further in 2018 by between 1.5-2.5%. The company expects ASC to expand by 1.5-2.5% in the US, by 1.0-2.0% in Europe, and by 6.5-7.5% in Brazil. It remains optimistic for the CIS region for which it sees ASC growing at 2.0-3.0% but ArcelorMittal’s view of the growth in Chinese consumption for 2018 is less bullish at -0.5% to 0.5%.

Crude steel production for Q1 2018 slipped slightly on-year by -1.3% to 23.3 million tonnes. Steel shipments upticked however to 21.3mt from 21.1mt in Q1 2017. Iron ore own production also rose on-year by 600,000t to 14.6mt, as did iron ore shipped at market price by 4.6% y-o-y to 9.1mt.

Sales in Q1 2018 were 19.3% higher as compared to Q1 2017 primarily due to higher average steel selling prices (+18.2%), higher steel shipments (+1.4%), and higher market-priced iron ore shipments (+5.5%). These were offset in part by lower seaborne iron ore reference prices (-13.1%).

Sales value was $19.2 billion, up significantly from $16.1 billion in the prior-year quarter. Net income at just under $1.2 billion rose by 20% from $1 billion in Q1 2017. Ebitda was $2.5 billion versus $2.2 billion on the same comparison. Net debt decreased at the end of Q1 2018 to $11.1 billion from $12.1 billion at the end of Q1 2017.