Key Highlights:
Health and safety performance: Protecting the health and wellbeing
of employees remains the Company’s overarching priority; LTIF rate3 of
0.89x in 2Q 2021 and 0.83x in 1H 2021
Significantly improved operating performance in 2Q 2021, with the
continuing demand recovery supporting a further positive evolution
of steel spreads and 2.4% sequential increase in steel shipments to
16.1Mt (vs. scope adjusted4 6Mt in 1Q 2021)
2Q 2021 operating income of $4.4bn compares to $2.6bn in 1Q 2021; 1H
2021 operating income of $7.1bn
EBITDA of $5.1bn in 2Q 2021, the strongest quarter since 2008 and
55.8% higher than 1Q 2021; 1H 2021 EBITDA of $8.3bn represents the
strongest half year performance since 2008
Share of JV and associates net income in 2Q 2021 further improved to
$0.6bn, reflecting continued strong performance at AMNS India8 and
AMNS Calvert9; 1H 2021 share of JV and associates net
income $1.0bn
Net income of $4.0bn in 2Q 2021 vs. $2.3bn in 1Q 2021; 1H 2021 net
income of $6.3bn (vs. adjusted net loss in 1H 2020 of $0.9bn)7 represents
the strongest half year performance since 2008
Free cash flow18 of $1.7bn generated in 2Q 2021 ($2.3bn
net cash provided by operating activities less capex of $0.6bn)
includes a further $1.9bn investment in working capital on account
of higher market prices; this brings the 1H 2021 free cash flow
generated to $2.0bn ($3.3bn net cash provided by operating
activities less capex of $1.2bn less minority dividends $0.1bn)
despite a total $3.5bn investment in working capital
Gross debt declined to $9.2bn (vs. $11.4bn as end of 1Q 2021 and
$12.3bn as end of 2020) and net debt declined to $5.0bn (vs. $5.9bn
as end of 1Q 2021 and $6.4bn as end of 2020)
Since April 1, 2021, the Company returned $1.6bn to shareholders
through share buybacks and the payment of the annual base dividend.
Total returns to shareholders since September 2020 now total $2.8bn
Strategic update and outlook:
Leadership on decarbonization: New
Group CO2 reduction target of 25% by 2030; new Europe CO2 reduction
target of 35% (previously 30%) by 2030 includes the acceleration of
DRI-EAF investments and the world’s first full scale zero
carbon-emissions steel plant at Sestao, Spain; the new group
decarbonization plan requires an estimated gross investment
(pre-government funding) of $10bn
Capex update: FY
2021 capex is expected to increase to $3.2bn from previous guidance
of $2.9bn to reflect the impacts of higher volumes and capacity
utilization – the Company’s operating plan (including the number of
tools utilized) has changed to reflect the strength of the demand
environment
Demand outlook improving: The
Company has upgraded its global apparent steel consumption (ASC)
forecast in 2021 vs. 2020 from +7.5% to +8.5% (from previous growth
estimate of +4.5% to +5.5%
New $2.2bn share buy-back program: The
Company will return the $1.2bn proceeds from the redeemed Cleveland
Cliffs preference shares and has decided to advance $1bn as part of
its prospective 2022 capital return to shareholders (equivalent to
50% of 1H 2021 FCF) as a share buy back program to be completed by
the end of 2021
Financial highlights (on the basis of IFRS):
(USDm) unless otherwise shown |
2Q 21 |
1Q 21 |
2Q 20 |
1H 21 |
1H 20 |
Sales |
19343 |
16193 |
10976 |
35536 |
25820 |
Operating income / (loss) |
4,432 |
2,641 |
-253 |
7073 |
-606 |
Net income / (loss) attributable to equity holders of the
parent |
4005 |
2285 |
-559 |
6290 |
-1679 |
Basic earnings / (loss) per common share (US$) |
3 |
2 |
-0.5 |
5.4 |
-1.57 |
Operating (loss) / income / tonne (US$/t) |
276 |
160 |
-17 |
217 |
-18 |
EBITDA |
5,052 |
3,242 |
707 |
8294 |
1674 |
EBITDA/ tonne (US$/t) |
314 |
197 |
48 |
255 |
49 |
Crude steel production (Mt) |
17.8 |
17.6 |
14.4 |
35.4 |
35.5 |
Steel shipments (Mt) |
16.1 |
16.5 |
14.8 |
32.6 |
34.3 |
Total group iron ore production (Mt) |
|
|
|
|
|
Iron ore production (Mt) (AMMC and Liberia only) |
13.3 |
15.3 |
14.8 |
13.5 |
14.4 |
Iron ore shipped (Mt) (AMMC and Liberia only) |
9.8 |
10.6 |
9.8 |
9.2 |
8.6 |
Source from ArcelorMittal |