ArcelorMittal achieves 2010 cost-cutting target of $3bn in H1

ArcelorMittal achieves 2010 cost-cutting target of $3bn in H1
PTI
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First Published: Sun, Aug 01 2010. 11 38 AM IST
Updated: Sun, Aug 01 2010. 11 38 AM IST
New Delhi: The world’s largest steel-maker, ArcelorMittal, has achieved its target of saving $3 billion in 2010 through various cost-cutting measures in the first half of the year itself.
“At the end of the first half of 2010, we had achieved annualised sustainable cost savings of $3 billion, meeting our 2010 full-year target of $3 billion,” the company said in its half-yearly report emailed from Luxembourg, where it is headquartered.
“We have demonstrated a significant flexibility in our capacity utilisation, implementing production cuts of up to 45% in response to the economic crisis at the end of 2008, before gradually increasing capacity utilisation rates back to 78% as of June, 2010,” the report said.
The company now plans to bring down production to 70% in the July-September period from the June level.
“So far, in the third quarter of 2010, we have taken steps to adjust production to expected seasonally weaker demand, particularly in Europe, and will continue to make similar adjustments to increase or decrease production depending on market conditions,” it said.
In the aftermath of the global economic crisis in 2009, the company had been operating at 59 per cent of its production capacity.
The company had initiated the cost-cutting measures to tide over the demand slump amid the global economic crisis in 2008-09. The measures, which included cutting production and optimising its operations, helped the NRI billionaire L N Mittal-led firm, achieve its 2010 cost-cutting target in the first six months of the calendar year.
The company, which posted a profit of $1.7 billion in the April-June quarter, had expressed concerns over the prospects for the next three months, saying the dip in European and Chinese markets could impact its performance.
The company produced 73 million tonnes of steel in 2009, amounting to an 8 per cent share of global steel production.
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First Published: Sun, Aug 01 2010. 11 38 AM IST