Arcelor: a Strong Commitment to Value Creation.LUXEMBOURG -- Arcelor (ISIN Isin (ĭs`ĭn), capital of an ancient Semitic kingdom of N Babylonia. The city became important after the third dynasty of Ur fell to the Elamites and the Amorites (c.2025 B.C.). The phase from c.2025–c.1763 B.C. :LU0140205948) (PinkSheets:ARLOF) (BOURSE bourse (b  rs), term applied to a European stock exchange. The first international bourse was established in Antwerp in the 16th cent. :LOR LOR Letter Of Reprimand (military)LoR Lord of the Rings (J.R.R. Tolkien) LOR Learning Object Repository LOR Linux.Org. ) (EURONEXT:LOR) today announces its 2006-2008 strategic plan to maximise return for its shareholders. Key highlights of the plan include: --Target normalized EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become of Euro 7 billion, with further upside potential Upside potential The amount by which analysts or investors expect the price of a security may increase. upside potential The potential price or gain that may be expected in a security or in a security average, generally stated as the dollar --Sustainable and resilient free cash-flow generation of Euro 4.4 billion per annum Per annum Yearly. --Continuation of progressive dividend policy: 30% normalized payout ratio Payout Ratio The percentage of earnings paid out in dividends. It is calculated by dividing dividends per share by earnings per share. Notes: The payout ratio indicates how well earnings support the dividend payments: the lower the ratio, the more secure the dividend. --Targeting only value accretive acquisitions with ROCE ROCE See: Return on capital employed in excess of 15% --Commitment to return excess cash to shareholders, including all proceeds from disposal of non-core assets A commitment to value creation... A significant acceleration of cash-flow generation and the dynamic management of the portfolio of industrial assets are to deliver free cash-flow that will be available to increase shareholder returns. Arcelor's growth initiatives will be executed with a disciplined focus on highly value accretive opportunities consistent with its strategic vision. The group will pursue opportunities to strengthen its global leadership in key strategic markets such as the automotive industry The automotive industry is the industry involved in the design, development, manufacture, marketing, and sale of motor vehicles. In 2006, more than 69 million motor vehicles, including cars and commercial vehicles were produced worldwide. and will continue to seek regional leadership in profitable and high-growth areas throughout the world. Arcelor has strengthened the performance potential of its flat stainless business through investments (Carinox steel plant in Belgium) or acquisitions (Acesita in Brazil). The group will pursue the strategic review it has engaged into in view of exploring all options that could best unlock value for its shareholders. ...building on a proven and highly successful business model Four years after its creation, Arcelor has fully demonstrated its resilience across the industry cycle and delivered beyond promises. Arcelor has built an innovative business model designed to maximise cash-flow generation throughout the cycle and deliver sustainable profitability through focus on market consolidation in high margin products. Driven by a strong industrial project, Arcelor has implemented a very active portfolio management and gives priority on value before volumes. The group has strengthened its position in flat carbon products especially for the automotive industry, successfully tapping into new growth territories (North and South America, China...). Additionally, Arcelor holds a unique market position in steel distribution around the globe and delivers a continuous strong performance in the long carbon steel business. In Latin America, Arcelor has already created Euro 3.4 billion of additional value, with further promising expansion projects underway. The acquisition of Canadian steelmaker Dofasco builds on a strategic vision of global leadership and the integration of the company into the international Arcelor industrial set-up promises strong value creation opportunities. This investment allows Arcelor to develop a major position in the world largest automotive market. Note to editors: 1. The full presentation that will be shown to investors is available on investorrelations.arcelor.com. 2. Members of the media are invited to attend a conference call with Arcelor CFO See Chief Financial Officer. Gonzalo Urquijo on Monday, February 27, 2006 at 13h00 CET CET abbr. Central European Time CET Central European Time CET n abbr (= Central European Time) → hora de Europa central CET abbr . Call details on press.arcelor.com. About Arcelor Arcelor is the number one steel company in the world with a turnover of 32.6 billion euros in 2005. The company holds leadership positions in its main markets: automotive, construction, household appliances and packaging as well as general industry. The company - number one steel producer in Europe and Latin America - ambitions to further expand internationally in order to capture the growth potential of developing economies and offer technologically advanced steel solutions to its global customers. Arcelor employs 96,000 associates in over 60 countries. The company places its commitment to sustainable development at the heart of its strategy and ambitions to be a benchmark for economic performance, labour relations and social responsibility. |
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