By Alistair Holloway, Bloomberg
Helsinki: Arcelor Mittal, the company formed last year in the steel industry’s largest takeover, said its first- quarter profit fell by 5.1%.
Net income declined to $2.25 billion (Rs 9,395 crore) or $1.62 a share. That compares with $2.37 billion, or $1.71. Profit beat the $2.1 billion estimates from five analysts surveyed by Bloomberg. Sales gained by 5.5% to $24.5 billion.
Chief Executive Officer Lakshmi Mittal’s combination of Mittal Steel Co. with Arcelor SA in a $38.3 billion merger last year created a steelmaker three times larger than its nearest rival. Prices for hot steel coil in Europe gained 15% in the first quarter, according to data from Metal Bulletin.
“We have seen growing global demand and what we will need to see is the enlarged company seriously increase its share of this demand,” Stephen Pope, head of equity research at Cantor Fitzgerald LP in London, said in an interview.
Today’s earnings are the second reported for the combined company, which pours a 10th of the world’s steel. Earnings before interest, taxes, depreciation and amortization were $4.3 billion euros, exceeding the company’s 21 February forecast for ebitda of between $4 billion and $4.2 billion.
Other European steelmakers have reported bigger earnings increases. Salzgitter AG of Germany said yesterday first- quarter profit rose more than fivefold, while Rautaruukki Oyj, Finland’s biggest producer of carbon steel, said on 25 April first-quarter profit jumped 70% on construction demand in eastern Europe.