ArcelorMittal Narrows Loss in Q1

Steel margins expanded in all segments except NAFTA which saw EBITDA per tonne fall 25 percent from extreme winter conditions and spikes in energy costs. Weather impact charges totaled $315 million, $200 million of which was realized in Q1and $115 million that will impact Q2 earnings. Supply side disruptions due to inclement weather and logistic problems resulted in NAFTA steel shipments decreasing 2 percent to 5.6 million tonnes. A 1.7 percent decline in flat shipment volumes was partially offset by a 1.8 percent increase in long product volumes. Crude steel production was 6.25 million tonnes.

NAFTA sales dropped 1.3 percent from Q4, totaling $4.9 billion. Average steel selling prices for flat products were up 1.8 percent and 0.7 percent for long products.

Construction of a heavy gauge Galvanizing line #6 at ArcelorMittal Dofasco is expected to optimize costs and increase galvanized product shipments by 3 million tonnes per year. The line will be completed in 2015.

A reline of the #7 furnace in Indiana Harbor is scheduled for June and will last approximately two months. Shipments are not expected to be affected.

Iron ore shipments at market price decreased to 9.3 million tonnes from 10.3 million tonnes the previous quarter due to weather related issues. On a year over year basis ore shipments increased 28 percent due to higher shipments from Canada. Iron ore production in Q1 was 14.8 million tonnes, down 3.6 percent from the previous quarter due to severe winter conditions at the Canadian mines.

Iron ore capacity is expected to reach 84 million tonnes by the end of 2015 with another 11 million tonnes identified that could stretch capacity to 95 million tonnes.

The Arctic ore mine in Baffinland on the St Mary River is making good progress and is expected to begin shipments in December 2015 with a production capacity of 3.5 million tons per year.