Nov

6

ArcelorMittal Announces Output Cut, Lowers Forecast

Filed Under Finance | Leave a Comment

ArcelorMittal posted lower-than-expected profits and doubled production cuts as the impact of a global economic slowdown did not spare even the largest steelmaker in the world.

Third quarter income of the Luxembourg-based steel giant rose by 29% to $3.82 billion or $2.78 a share thus falling significantly below the estimate of $8.7 billion forecast by six analysts. Sales rose by 38% to $35.2 billion.

However ArcelorMittal announced that it would cut global output by around 30% in an attempt to support prices. Output of flat carbon steel is expected to fall by over 35% in United States and by more than 30% in Europe which constitute two of the biggest markets for the steel company. The cuts are expected to continue till early 2009, according to the chief financial officer of the company, Aditya Mittal.

Along with production cuts, ArcelorMittal also announced that it was lowering it fourth quarter forecast earnings by as much as 48% to $2.5 billion. The lowering of future profits and the slash in output comes at a time when the global economic slowdown has led to declining demand from both builders and auto makers. With this ArecelorMittal joins its competitors from Russia, South Korea and Japan in curtailing production only a couple of months after steel prices touched record highs.

Share and Enjoy:
  • Digg
  • del.icio.us
  • Facebook
  • Google
  • Live
  • Technorati