Bulletin: ArcelorMittal Counts On 2020 Steel Demand Increase Following Weaker-Than-Expected Results

LONDON (S&P Global Ratings) Feb. 11, 2020--S&P Global Ratings said today that while Luxembourg-based steel producer ArcelorMittal's (BBB-/Negative/A-3) 2019 results were weaker than expected, the company will likely see a recovery in 2020. Although steel markets will remain sluggish, margins are on track to improve, because some of the circumstances that suppressed profitability in 2019 will not be repeated in 2020. ArcelorMittal reported EBITDA of $5.2 billion for 2019, compared with our forecast of $6.0 billion in October 2019, and record 2018 results of $10.3 billion. The weaker-than-expected results reflect the very weak steel market conditions, which started in Europe then spread to other regions. Our preliminary calculation shows that ArcelorMittal's adjusted funds from operations (FFO) to debt fell below

...February 11, 2020 LONDON (S&P Global Ratings) Feb. 11, 2020--S&P Global Ratings said today that while Luxembourg-based steel producer ArcelorMittal's (###-/Negative/A-3) 2019 results were weaker than expected, the company will likely see a recovery in 2020. Although steel markets will remain sluggish, margins are on track to improve, because some of the circumstances that suppressed profitability in 2019 will not be repeated in 2020. ArcelorMittal reported EBITDA of $5.2 billion for 2019, compared with our forecast of $6.0 billion in October 2019, and record 2018 results of $10.3 billion. The weaker-than-expected results reflect the very weak steel market conditions, which started in Europe then spread to other regions. Our preliminary calculation shows that ArcelorMittal's adjusted funds from operations (FFO) to debt fell below 20% as of Dec. 31, 2019. This is well below the 25% threshold commensurate with the rating. However, while the recent results weigh on the rating, we anticipate...

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