The world’s largest steel maker, ArcelorMittal SA, said yesterday the steel business was starting to recover, even as it posted a loss of US$792,000 for the second quarter, its third consecutive quarterly loss.
CEO Lakshmi Mittal said the company would restart production at some plants to meet “some initial signs” that the steel slump is ending. He warned that full recovery would be slow and progressive.
ArcelorMittal blamed the net loss on US$1.2 billion in charges from writing down steel stocks and paying off workers who took up the company’s voluntary redundancy program. The company made a profit of US$5.8 billion last year.
Revenues more than halved for the three months ending June 30 to US$15.2 billion, down from US$37.8 billion a year ago.
The third quarter should be better, the company said, as shipments rise and costs for key raw materials — iron ore and coal — fall from record highs.
It said the global recession had triggered an “extreme weakness” in steel demand along with a steep fall in prices.
Its main customers — car makers, construction and engineering companies — have slashed output on falling demand from customers facing the sharpest downturn since World War II.
ArcelorMittal plunged into loss for the first time in the last three months of last year as the steel industry slipped rapidly from boom to bust.
The company shuttered plants this winter and spring as steel stocks remained high, laying off thousands of workers temporarily.
Fearing that these closures could become permanent, Belgian and French workers attacked company headquarters during a shareholder meeting in May.
The company is also trying to aggressively reduce a high debt burden that it built up during a rapid expansion program to meet surging demand in recent years. It paid off US$3.8 billion in net debt in the second quarter and had total debt of US$22.9 billion on June 30, it said.
It said its bankers had agreed to let it change a leverage ratio to give more flexibility if the economy worsens.
The company also reported cost savings of US$1.7 billion in the quarter, close to its target of US$2 billion for the year.
The Central Weather Administration (CWA) yesterday said it expected to issue a sea warning for Typhoon Fung-Wong tomorrow, which it said would possibly make landfall near central Taiwan. As of 2am yesterday, Fung-Wong was about 1,760km southeast of Oluanpi (鵝鑾鼻), Taiwan’s southernmost point, moving west-northwest at 26kph. It is forecast to reach Luzon in the northern Philippines by tomorrow, the CWA said. After entering the South China Sea, Typhoon Fung-Wong is likely to turn northward toward Taiwan, CWA forecaster Chang Chun-yao (張峻堯) said, adding that it would likely make landfall near central Taiwan. The CWA expects to issue a land
The Central Weather Administration (CWA) yesterday said it is expected to issue a sea warning for Typhoon Fung-wong this afternoon and a land warning tomorrow. As of 1pm, the storm was about 1,070km southeast of Oluanpi (鵝鑾鼻), Taiwan’s southernmost point, and was moving west-northwest at 28 to 32kph, according to CWA data. The storm had a radius of 250km, with maximum sustained winds of 173kph and gusts reaching 209kph, the CWA added. The storm is forecast to pass near Luzon in the Philippines before entering the South China Sea and potentially turning northward toward Taiwan, the CWA said. CWA forecaster Chang Chun-yao (張峻堯) said
PREPARATION: Ferry lines and flights were canceled ahead of only the second storm to hit the nation in November, while many areas canceled classes and work Authorities yesterday evacuated more than 3,000 people ahead of approaching Tropical Storm Fung-wong, which is expected to make landfall between Kaohsiung and Pingtung County this evening. Fung-wong was yesterday morning downgraded from a typhoon to a tropical storm as it approached the nation’s southwest coast, the Central Weather Administration (CWA) said, as it issued a land alert for the storm. The alert applies to residents in Tainan, Kaohsiung, Pingtung and Taitung counties, and the Hengchun Peninsula (恆春). As of press time last night, Taichung, Tainan, Kaohsiung, and Yilan, Miaoli, Changhua, Yunlin, Pingtung and Penghu counties, as well as Chiayi city and county had
The Central Weather Administration (CWA) yesterday issued a sea alert for Typhoon Fung-wong (鳳凰) as it threatened vessels operating in waters off the Pratas Islands (Dongsha Islands, 東沙群島), the Bashi Channel and south of the Taiwan Strait. A land alert is expected to be announced some time between late last night and early this morning, the CWA said. As of press time last night, Taoyuan, as well as Yilan, Hualien and Penghu counties had declared today a typhoon day, canceling work and classes. Except for a few select districts in Taipei and New Taipei City, all other areas and city
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