ArcelorMittal S.A. (MT) Q1 2023 Earnings Call Transcript

For the period ending March 31, 2023

May 4, 2023 9:30 a.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Daniel Fairclough

Good afternoon, everybody, and good morning. Welcome to ArcelorMittal’s First Quarter 2023 Analyst Investor Call. As Francine said, this is Daniel Fairclough from the ArcelorMittal Investor Relations team. And as usual, I’m joined on this call today by Genuino Christino, our Chief Financial Officer.

Before I hand over to Genuino, I’d like to mention a few housekeeping items. First, I want to refer everybody to the disclaimers on Slide 2 of the results presentation that we published on our website this morning. I’d also like to remind everybody that today’s call is being recorded and it’s scheduled to last up to 45 minutes.

And finally, I’d just like to reiterate Francine instructions. [Operator Instructions]

And with that, I’d like to hand over to Genuino for his opening remarks.

Genuino Christino

Thank you, Daniel, and welcome, everyone. My remarks today will be brief and focus on three points only. The results continue to demonstrate improved profitability relative to prior cycles, growth – the capital we have allocated to growth is delivering and supporting higher normalized profitability for ArcelorMittal. And the third point I will address is capital returns. The positive outlook for the business and for our free cash flow generation, we are launching a new buyback program.

Firstly, on results. As expected, at the end of the destock has supported a strong recovery in our shipment volumes. This has underpinned the sequential improvement in profitability. EBITDA per tonne improved to 126, the first quarter, comparing very favorably with prior cycles. This further highlights the benefits of our cost actions and portfolio upgrades in recent periods.

Secondly, on growth, the quarter – this quarter, we completed the acquisition of CSP in Brazil, adding 3 million tonnes of highest-quality capacity at the bottom of the cost curve. You will see the full impact on shipments and profitability in the second quarter. Together with the Texas HBI plant we acquired last year and the contribution from the new hot strip mill in Mexico, our investments are clearly supporting higher normalized profitability and our investments continue. We have this quarter announced the formation of a JV with Casa dos Ventos to develop 554-megawatt wind power project in Brazil. With a modest equity contribution, this project can supply up to 38% of our electricity needs in the country.