Arcelor 2002 First Half Results; Coming Back to Profitability.Business Editors LUXEMBOURG--(BUSINESS WIRE)--Aug. 30, 2002 Arcelor (Code Reuters:CELR.PA)(SICOVAM SICOVAM Société Interprofessionelle pour la Compensation des Valeurs Mobilières :5786) -- Recovery of results for the second quarter -- Integration under way, first synergies realized -- Encouraging prospects The Board of Directors met on August 30, 2002 under the chairmanship of Joseph Kinsch, reviewed the Group's consolidated results of the second quarter 2002 and approved the consolidated accounts for the first half of 2002. Following Francis Mer's resignation, Edmond Pachura was appointed Board Member of Arcelor. At June 30 2002, pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma consolidated net income was 93 million euro. In million First First Second First of euro Half Quarter Quarter Half Pro Forma-Unaudited(1) 2001 2002 2002 2002 ---------------------------------------------------------------------- Revenue 14,314 6,824 6,881 13,705 ---------------------------------------------------------------------- EBIT 611 67 274 341 ---------------------------------------------------------------------- Net income, Group share 369 -22 115 93 ---------------------------------------------------------------------- EPS(2) 0.77 -0.05 0.25 0.20 ---------------------------------------------------------------------- (2) in euro. Revenue of the Group for the first half amounted to 13,705 million euro compared to 14,314 million for the same period of 2001, or a 4% decrease on a comparable basis (6,824 million for the first quarter and 6,881 million for the second quarter). Geographical breakdown was as follows : 75% in the EU, 12% in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. , 5% in South America South America, fourth largest continent (1991 est. pop. 299,150,000), c.6,880,000 sq mi (17,819,000 sq km), the southern of the two continents of the Western Hemisphere. and 8% in the rest of the world. EBIT EBIT See: Earnings Before Interest and Taxes EBIT See earnings before interest and taxes (EBIT). was 341 million euro (67 million for the first quarter and 274 million for the second quarter), or 2.5% of net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight , against 611 million for the first half of 2001. After financial interest expenses of 214 million euro and no contribution from associated companies associated company associate n → Partnerfirma f associated company n → società collegata , Group share of net income amounts to 93 million euro (-22 million for the first quarter and 115 million for the second quarter). Cash generated by operations of 682 million euro, compared to 1,114 million for the same period 2001, benefits from a decrease in working capital requirements Capital requirements Financing required for the operation of a business, composed of long-term and working capital plus fixed assets. essentially due to a reduction of inventories.
In million euro Dec. 31, March 31, June30,
Pro forma-unaudited(1) 2001(3) 2002 2002
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Shareholders' equity(2) 8,509 8,353 8,249
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Net financial debt(4) 6,510 6,878 6,317
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Net financial debt /
Shareholders' equity(4) 0.77 0.82 0.77
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(2) including minority interests.
(3) modified following restatements for accountancy purposes linked to
the merger as of February 28, 2002.
(4) excluding securitization effect.
At June 30, 2002, net financial debt was 6,317 million euro, or a decrease compared to December 31, 2001 (6,510 million) and March 31, 2002 (6,878 million). Increased efforts, most notably toward an improved control of working capital requirements, will contribute to further reductions of financial indebtedness. At June 30, 2002, the net financial debt/shareholders' equity ratio, including minority interests, was 0.77, to be compared with 0.82 at March 31, 2002 and 0.77 at December 31, 2001.
Breakdown of revenue and EBIT by sector
In million Euro First Half 2001 First Half 2002
Pro Forma- -----------------------------------
Unaudited (1) Revenue EBIT % Revenue EBIT %
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Flat Carbon Steel 6,902 380 5.5 6,420 20 0.3
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Distribution- Processing and
Trading 5,016 102 2.0 4,864 97 2.0
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Long Carbon Steel 2,129 200 9.4 2,225 231 10.4
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Stainless Steel 2,227 -95 -4.3 2,241 25 1.1
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Other Activities 385 -22 -5.7 478 -37 -7.7
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Intra group sales -2,345 ns ns -2,523 ns ns
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The shrinking of revenue (pro forma) for the Flat Carbon Steel sector compared to 2001 results from a fall of average selling prices The average sales price of goods or commodities. Especially used in the retail sector and technology distribution. (-7%), shipped volumes being slightly reduced over the period. Distribution, Processing and Trading have seen a more contrasted evolution, the second quarter showing globally a clear improvement after a very difficult situation at the beginning of the year. Distribution and steel service centers experience a reduction of volumes to the benefit of prices, when Construction remains in line with the first half of 2001 and Tubes show a clear progression. Revenue for Long Carbon Products reflect new price increases for certain products (+1%) and a good volume situation (+4%). For Stainless Steels stainless steel: see steel. stainless steel Any of a family of alloy steels usually containing 10–30% chromium. The presence of chromium, together with low carbon content, gives remarkable resistance to corrosion and heat. , both the acceleration of markets recovery and increase in nickel nickel, metallic chemical element; symbol Ni; at. no. 28; at. wt. 58.69; m.p. about 1,453°C;; b.p. about 2,732°C;; sp. gr. 8.902 at 25°C;; valence 0, +1, +2, +3, or +4. price during the second quarter have allowed significant improvements of average selling prices and volumes for flat products, mainly in Europe and in Asia, while selling prices for Stainless long products have stabilized sta·bi·lize v. sta·bi·lized, sta·bi·liz·ing, sta·bi·liz·es v.tr. 1. To make stable or steadfast. 2. at low levels. After a very difficult first quarter, improvement in prices and volumes for flat carbon steels and stainless steels announces positive evolutions which still translate only partially in the results of the second quarter. The strong increase of Long Carbon products is essentially due to excellent performance of Brazil and Southern Europe Southern Europe or sometimes Mediterranean Europe is a region of the European continent. There is no clear definition of the term which can vary depending on whether geographic, cultural, linguistic or historical factors are taken into account. . The progression of results for the Group also benefits from cost cutting actions and a synergy The enhanced result of two or more people, groups or organizations working together. In other words, one and one equals three! It comes from the Greek "synergia," which means joint work and cooperative action. program which is on schedule. PROSPECTS Despite a hesitating hes·i·tate intr.v. hes·i·tat·ed, hes·i·tat·ing, hes·i·tates 1. a. To be slow to act, speak, or decide. b. To pause in uncertainty; waver. 2. To be reluctant. 3. world economy evolution, the Group expects a positive development of its results reinforced by a better adjustment of produced volumes as well as a significant improvement of the mix. A rigorous approach in terms of appropriate supply answering to the bare needs of the market should allow an improvement of the profitability of the Group in terms of capital employed Capital Employed 1. The total amount of capital used for the acquisition of profits. 2. The value of all the assets employed in a business. 3. Fixed assets plus working capital. 4. Total assets less current liabilities. . (1) Pro forma-unaudited financial disclosures are meant to simulate simulate - simulation the effects of the merger as of February 28, 2002 for periods of time starting prior to this date. Half year accounts fully compliant with IAS See iPlanet Application Server. 1. (computer) IAS - The first modern computer. It had main registers, processing circuits, information paths within the central processing unit, and used Von Neumann's fetch-execute cycle. will be available on the Corporation's web site: www.arcelor.com on September 2,2002. This press release contains certain forward looking statements regarding anticipated market evolution and the future prospects of Arcelor. While these statements are based on the Company's best estimations as of the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" , actual results will vary as a function of market conditions, the action of competitors consumer demand, steel prices, economic conditions and other factors. |
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