ArcelorMittal Reports Record Full Year and Fourth Quarter 2007 Results.LUXEMBOURG -- Regulatory News: ArcelorMittal1 (referred to as "ArcelorMittal", or the "Company") (New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of : MT; Amsterdam: MT; Madrid: MTS (1) See Microsoft Transaction Server. (2) (Modular TV System) The stereo channel added to the NTSC standard, which includes the SAP audio channel for special use. 1. MTS - Message Transport System. 2. ; Paris: MTP (1) (Message Transfer Part) See SS7. (2) (Media Transfer Protocol) A Microsoft enhancement to the picture transfer protocol (PTP), starting with Windows Media Player 10 in Windows XP. ; Brussels: MTBL MTBL Mean Time Between Data Loss ; Luxembourg: MT), the world's largest and most global steel company, today announced results for the three- and twelve-month periods ended December 31, 2007. Highlights: Record 2007 results * 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 2 of $19.4 billion, up 27% year-on-year * Net income of $10.4 billion, up 30% year-on-year * Strong cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses of $16.5 billion; $5.4 billion capex spend * Total return to ArcelorMittal shareholders of $4.4 billion in 2007, of which $1.8 billion in cash dividends paid and $2.6 billion in share buy-backs * Synergies of $1.4 billion generated by end of 2007 Dividend distribution 2008 * As per the Company's dividend policy of returning 30% of net income to shareholders, ArcelorMittal will return a total of $3.1 billion to shareholders in 2008, of which $2.1 billion will be in cash dividends and $1.0 billion in share buy-backs Three dimensional growth strategy advancing: * 20 million tonnes of organic growth potential as announced on September 11, 2007 * Geographic strategy advancing with transactions announced in Argentina, Brazil, China, Costa Rica Costa Rica (kŏs`tə rē`kə), officially Republic of Costa Rica, republic (2005 est. pop. 4,016,000), 19,575 sq mi (50,700 sq km), Central America. , Egypt, Mexico and Poland * Development of product diversification Diversification A risk management technique that mixes a wide variety of investments within a portfolio. It is designed to minimize the impact of any one security on overall portfolio performance. Notes: Diversification is possibly the greatest way to reduce the risk. with transactions in pipes and tubes, galvanizing galvanizing, process of coating a metal, usually iron or steel, with a protective covering of zinc. Galvanized iron is prepared either by dipping iron, from which rust has been removed by the action of sulfuric acid, into molten zinc so that a thin layer of the zinc , stainless steel 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. and wire businesses * Enhancement in value chain with progress in both mining activities and distribution * Total of 35 transactions announced in 2007 - 14 transactions completed in 2007, with a capital outlay capital outlay See capital expenditure. of $12.3 billion3 including cash paid, debt assumed and fair value of equity issued Guidance for first quarter 2008 * Q108 EBITDA guidance of $4.7 - $5.0 billion, versus $4.3 billion in Q107 Commenting, Lakshmi N. Mittal, President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. , ArcelorMittal, said: "2007 has been a truly excellent year for ArcelorMittal. We are announcing today record earnings with EBITDA of $19.4 billion, some 27% higher than 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 2006 results, and strong cash flow from operations. This reflects the strength of the ArcelorMittal business model, which enables us to benefit from a healthy global demand for steel in both the high-quality developed and fast-growth developing economies. 2007 was the first full year following the merger of Arcelor and Mittal Steel to create the world's leading steel company. I am very proud of the way the two companies have integrated so successfully, building a steel company which is focused on leading the transformation of our industry towards a sustainable future. Today's results clearly demonstrate the considerable progress that we are making in this regard. Separately, we have not let the integration process distract us from continuing to identify further opportunities for progress. In 2007, we announced 35 acquisitions, all of which serve to strengthen ArcelorMittal's global steel offering further. We have also identified 20 million tonnes of organic growth potential. Looking forward we are expecting performance in the first quarter of 2008 to be comparable to the fourth quarter 2007 levels. We are very pleased with the performance and progress of the Company". [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] FULL YEAR 2007 AND FOURTH QUARTER EARNINGS ANALYST CONFERENCE CALL Additionally, ArcelorMittal management will host a conference call for members of the investment community to discuss the full year 2007 and fourth quarter 2007 financial performance of ArcelorMittal at 9.30 am New York Time / 2.30 pm Greenwich Mean Time Greenwich mean time or Greenwich meridian time (GMT), the former name for mean solar time at the original site of the Royal Observatory in Greenwich, England, which is located on the prime meridian. / 3.30 pm Central European Time Central European Time Noun the standard time adopted by Western European countries one hour ahead of Greenwich Mean Time, corresponding to British Summer Time Abbrev: (CET) on Wednesday, February 13, 2008. The conference call will include a brief question and answer session with senior management. The conference call information is as follows: Dial in access numbers will be the following: [TABLE OMITTED] A replay of the conference call will be available for one week by dialling (access code 634819#): [TABLE OMITTED] The presentation will be available via a live video webcast on www.arcelormittal.com Forward-Looking Statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. This document may contain forward-looking information and statements about ArcelorMittal and its subsidiaries. These statements include financial projections and estimates and their underlying assumptions, statements regarding plans, objectives and expectations with respect to future operations, products and services, and statements regarding future performance. Forward-looking statements may be identified by the words "believe," "expect," "anticipate," "target" or similar expressions. Although ArcelorMittal's management believes that the expectations reflected in such forward-looking statements are reasonable, investors and holders of ArcelorMittal's securities are cautioned that forward-looking information and statements are subject to numerous risks and uncertainties, many of which are difficult to predict and generally beyond the control of ArcelorMittal, that could cause actual results and developments to differ materially and adversely from those expressed in, or implied or projected by, the forward-looking information and statements. These risks and uncertainties include those discussed or identified in the filings with the Netherlands Authority for the Financial Markets, the Luxembourg Stock Market Authority for the Financial Markets (Commission de Surveillance du Secteur Financier) and the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. Securities and Exchange Commission (the "SEC") made or to be made by ArcelorMittal or the entities to which it is successor (including Mittal Steel Company Mittal Steel Company N.V. (Euronext: MT, NYSE: MT) was the world's largest steel producer by volume, and also the largest in turnover. Company is now part of Arcelor Mittal. CEO Lakshmi Mittal's family owned 88% of the company. N.V. ("Mittal Steel")) including Mittal Steel's Annual Report on Form 20-F filed with the SEC. ArcelorMittal undertakes no obligation to publicly update its forward-looking statements, whether as a result of new information, future events, or otherwise. [TABLE OMITTED] ARCELORMITTAL FULL YEAR AND FOURTH QUARTER 2007 RESULTS - PRO FORMA COMPARISON ArcelorMittal, the world's largest and most global steel company, today announced results for the three- and twelve-month periods ended December 31, 2007. Pro forma presentation The pro forma results for 2006 include the results of Arcelor, Sonasid and Dofasco as if these acquisitions had occurred on January 1, 2006. The results of Sicartsa are included from April 20, 2007, the date of its acquisition by the Company. Disposals The pro forma results for 2006 include the results of the following subsidiaries until the dates of their disposals: * the disposal of Huta Bankowa Polska z.o.o. in January 2007; * the disposal of Travi e Profilati di Pallanzeno in January 2007; and * the disposal of Stahlwerk Thuringen GmbH in March 2007. On August 31, 2007, ArcelorMittal merged its European laser-welded tailored blanks business (previously accounted for as an asset held for sale) with Noble International Limited ("Noble International"). Results for the twelve months ended December 31, 2007 versus pro forma results for the twelve months ended December 31, 2006 ArcelorMittal's net income for the twelve months ended December 31, 2007 was $10.4 billion, or $7.41 per share as compared to pro forma net income for the twelve months ended December 31, 2006 of $8.0 billion, or $5.76 per share. Sales and operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. for the twelve months ended December 31, 2007 were $105.2 billion and $14.8 billion, respectively, as compared with pro forma sales and operating income for the twelve months ended December 31, 2006, of $88.6 billion and $11.8 billion. Sales were higher primarily due to higher average selling prices The average sales price of goods or commodities. Especially used in the retail sector and technology distribution. . Total steel shipments for the twelve months ended December 31, 2007 remained flat at 110 million metric tonnes as compared with pro forma total steel shipments of 111 million metric tonnes for the twelve months ended December 31, 2006. The Company reduced production and shipments during the year in line with a reduction in market demand, particularly 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. . Stainless steel production and shipments were also reduced in line with market decline. Depreciation for the twelve months ended December 31, 2007 increased to $4.6 billion as compared with pro forma depreciation for the twelve months ended December 31, 2006 of $3.4 billion. Depreciation increased primarily due to increase in tangible and intangible assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. , foreign exchange differences, and acquisitions. Depreciation was also negatively impacted in 2007 by impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. expenses ($172 million) and reduction of goodwill ($260 million). As from January 1, 2008, the Company expects the quarterly depreciation charge to return to normalized levels of approximately $1.1 billon bil·lon n. 1. An alloy of gold or silver with a greater proportion of another metal, such as copper, used in making coins. 2. An alloy of silver with a high percentage of copper, used in making medals and tokens. per quarter. Income from equity method investments and other income for the twelve months ended December 31, 2007 was $985 million as compared with pro forma income from equity method investments and other income of $619 million for the twelve months ended December 31, 2006. The increase primarily relates to our German investment. Net financing costs Net financing cost Also called the cost of carry or, simply carry, the difference between the cost of financing the purchase of an asset and the asset's cash yield. Positive carry means that the yield earned is greater than the financing cost; negative carry means that the for the twelve months ended December 31, 2007 decreased to $927 million as compared with pro forma net financing costs for the twelve months ended December 31, 2006 of $1.3 billion. Net financing costs for the twelve months ended December 31, 2007 were lower primarily due to increase in mark-to-market gain on financial instruments of $379 million. Income tax expense for the twelve months ended December 31, 2007, increased to $3.0 billion as compared with pro forma income tax expense for the twelve months ended December 31, 2006 of $1.7 billion. The effective tax rate for the twelve months ended December 31, 2007 was 20.4% as compared with the pro forma effective tax rate for the twelve months ended December 31, 2006 of 14.9%. The increase in effective tax rate is mainly due to higher income in higher-tax jurisdictions in 2007. Minority interest for the twelve months ended December 31, 2007 remained flat at $1.5 billion as compared with the pro forma minority interest for the twelve months ended December 31, 2006. Minority interest was lower due to the repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. of minority interest in ArcelorMittal Brasil and Arcelor, offset by the increase in results allocated to the remaining minority interest. Results for the three months ended December 31, 2007 versus the three months ended September 30, 2007 and the pro forma results for the three months ended December 31, 2006 ArcelorMittal's net income for the three months ended December 31, 2007 was $2.4 billion, or $1.72 per share, as compared with $3.0 billion, or $2.10 per share, for the three months ended September 30, 2007, and pro forma net income of $2.4 billion, or $1.72 per share, for the three months ended December 31, 2006. Sales and operating income for the three months ended December 31, 2007 were $28.0 billion and $3.3 billion, respectively, as compared with $25.5 billion and $3.9 billion, respectively, for the three months ended September 30, 2007. Pro forma sales and operating income for the three months ended December 31, 2006 were $23.2 billion and $3.2 billion, respectively. Total steel shipments for the three months ended December 31, 2007 were 28.0 million metric tonnes, as compared with 26.0 million metric tonnes for the three months ended September 30, 2007, and pro forma steel shipments of 26.7 million metric tonnes for the three months ended December 31, 2006. Total steel shipments were greater in the three months ended December 31, 2007, as compared to the three months ended September 30, 2007, since the three-month period ended September 30, 2007 was affected by seasonal slowdown For articles with similar titles, see Slow Down (disambiguation). A slowdown is an industrial action in which employees perform their duties but seek to reduce productivity or efficiency in their performance of these duties. . Analysis of operations for the three months ended December 31, 2007 versus the three months ended September 30, 2007 and the pro forma results for the three months ended December 31, 2006 Sales for the three months ended December 31, 2007 were $28.0 billion, as compared with $25.5 billion for the three months ended September 30, 2007, and pro forma sales of $23.2 billion for the three months ended December 31, 2006. Sales for the three months ended December 31, 2007 as compared with the three months ended September 30, 2007 increased primarily due to higher volumes. Depreciation for the three months ended December 31, 2007 was higher at $1.6 billion, as compared with $1.0 billion for the three months ended September 30, 2007, and as compared with pro forma depreciation of $875 million for the three months ended December 31, 2006. Depreciation was negatively impacted by impairment expenses relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the closure of the hot and cold mill at the Contrecoeur plant in Canada of $122 million and $50 million for the steel plant at ArcelorMittal Gandrange in France and reduction of goodwill of $260 million. This reduction of goodwill resulted from the recognition of net operating losses Net operating losses Losses that a firm can take advantage of to reduce taxes. previously not recognized in purchase accounting, amongst others due to a restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). in ArcelorMittal Brasil in the second half of 2007, post the mandatory tender offer. Operating income for the three months ended December 31, 2007 decreased to $3.3 billion, as compared with $3.9 billion for the three months ended September 30, 2007, and increased as compared with pro forma operating income of $3.2 billion for the three months ended December 31, 2006. The decrease in operating income is primarily attributable to the increase in depreciation as described above. Income from equity method investments and other income/expenses for the three months ended December 31, 2007 was $273 million as compared with $280 million for the three months ended September 30, 2007, and pro forma income from equity investments and other income of $209 million for the three months ended December 31, 2006. Net financing costs for the three months ended December 31, 2007 were higher at $546 million as compared with $189 million for the three months ended September 30, 2007, and lower as compared to pro forma net financing income of $4 million for the three months ended December 31, 2006. Financing costs increased primarily due to a fourth quarter loss on mark-to-market financial instruments of $53 million, compared to a gain of $274 million in the third quarter of 2007. Income tax expense for the three months ended December 31, 2007 decreased to $345 million as compared to $672 million for the three months ended September 30, 2007. The effective tax rate for the three months ended December 31, 2007 was 11.4% as compared with 17.0% for the three months ended September 30, 2007. The pro forma income tax expense for the three months ended December 31, 2006 was $642 million, representing an effective tax rate of 18.6%. Income tax expense decreased for the three months ended December 31, 2007 primarily due to the positive impact of recognition of deferred tax assets. Minority interest for the three months ended December 31, 2007 was $237 million, as compared with $312 million for the three months ended September 30, 2007, and pro forma minority interest of $443 million for the three months ended December 31, 2006. This decrease resulted primarily from the repurchase of minority interest in Arcelor and ArcelorMittal Brasil, partially offset by an increase in minority results in ArcelorMittal South Africa South Africa, Afrikaans Suid-Afrika, officially Republic of South Africa, republic (2005 est. pop. 44,344,000), 471,442 sq mi (1,221,037 sq km), S Africa. . Net income for the three months ended December 31, 2007 decreased to $2.4 billion as compared with $3.0 billion for the three months ended September 30, 2007, and pro forma net income of $2.4 billion for the three months ended December 31, 2006. Analysis of segment operations Q4 2007 v Q3 2007 Flat Carbon Americas Total steel shipments in the Flat Carbon Americas segment were higher at 7.3 million metric tonnes for the three months ended December 31, 2007, as compared with steel shipments of 6.9 million metric tonnes for the three months ended September 30, 2007. Sales were higher at $6.2 billion for the three months ended December 31, 2007, as compared with sales of $5.7 billion for the three months ended September 30, 2007. Operating income was lower at $693 million for the three months ended December 31, 2007, as compared with operating income of $864 million for the three months ended September 30, 2007. Operating income was impacted by impairment expenses of $122 million in Contrecoeur, Canada. Operating results for the three months ended December 31, 2007 decreased as compared with the three months ended September 30, 2007, due to impairment expenses and higher costs, driven by higher input prices, that were partially offset by higher volumes. Flat Carbon Europe Total steel shipments in the Flat Carbon Europe segment were higher at 8.8 million metric tonnes for the three months ended December 31, 2007, as compared with steel shipments of 7.8 million metric tonnes for the three months ended September 30, 2007. Sales were higher at $9.2 billion for the three months ended December 31, 2007, as compared with sales of $8.2 billion for the three months ended September 30, 2007. Operating income was lower at $869 million for the three months ended December 31, 2007, as compared to $1.0 billion for the three months ended September 30, 2007. Operating results for the three months ended December 31, 2007 were lower as compared to the three months ended September 30, 2007, primarily due to higher input prices, partially offset by higher volumes. Long Carbon Americas and Europe Total steel shipments in the Long Carbon Americas and Europe segment were higher at 6.3 million metric tonnes for the three months ended December 31, 2007, as compared with steel shipments of 5.7 million metric tonnes for the three months ended September 30, 2007. Sales were higher at $6.7 billion for the three months ended December 31, 2007, as compared with sales of $5.5 billion for the three months ended September 30, 2007. Operating income was higher at $923 million for the three months ended December 31, 2007, as compared with operating income of $897 million for the three months ended September 30, 2007. During the fourth quarter, operating income was impacted by impairment expenses of $50 million at ArcelorMittal Gandrange. Operating results for the three months ended December 31, 2007 increased as compared with the three months ended September 30, 2007, primarily due to higher volumes partially offset by higher costs. Asia Africa and CIS Cis (sĭs), same as Kish (1.) (1) (CompuServe Information Service) See CompuServe. (2) (Card Information S ("AACIS AACIS American Association for Collegiate Independent Study (conference) ") Total steel shipments in the AACIS segment were marginally lower at 5.2 million metric tonnes for the three months ended December 31, 2007, as compared with steel shipments of 5.3 million metric tonnes for the three months ended September 30, 2007. Sales were marginally lower at $4.7 billion for the three months ended December 31, 2007, as compared to $4.8 billion for the three months ended September 30, 2007. Operating income was lower at $631 million for the three months ended December 31, 2007, as compared with operating income of $790 million for the three months ended September 30, 2007. Operating results for the three months ended December 31, 2007 decreased as compared to the three months ended September 30, 2007, mainly due to lower volumes and higher input costs. Stainless Steel Total steel shipments in the Stainless Steel segment7 were higher at 461 thousand metric tonnes for the three months ended December 31, 2007, as compared with steel shipments of 432 thousand metric tonnes for the three months ended September 30, 2007. Sales were higher at $2.3 billion for the three months ended December 31, 2007, as compared with sales of $2.0 billion for the three months ended September 30, 2007. Operating income was lower at $115 million for the three months ended December 31, 2007, as compared with operating income of $151 million for the three months ended September 30, 2007. Operating results for the Stainless Steel segment decreased for the three months ended December 31, 2007, as compared to the three months ended September 30, 2007, due to a significant negative price-cost squeeze effect mainly driven by lower selling prices. AM3S AM3S Arcelor Mittal Steel Solutions and Services (8) AM3S segment shipment and sales from the fourth quarter of 2007 onwards on·ward adj. Moving or tending forward. adv. also on·wards In a direction or toward a position that is ahead in space or time; forward. Adv. 1. include those of ArcelorMittal International, which are principally derived from trading and international sales activities in certain regions. As a result, shipment and sales figures sales figures npl → cifras fpl de ventas for this period are not fully comparable with previous periods. Total steel shipments in the AM3S segment were higher at 5.3 million metric tonnes for the three months ended December 31, 2007, as compared with steel shipments of 3.5 million metric tonnes for the three months ended September 30, 2007. Sales in the AM3S segment were higher at $5.3 billion for the three months ended December 31, 2007, as compared with sales of $3.7 billion for the three months ended September 30, 2007. Operating income increased to $155 million for the three months ended December 31, 2007, as compared with operating income of $119 million for three months ended September 30, 2007, primarily due to higher volumes. Liquidity and Capital Resources For the three months ended December 31, 2007, net cash provided by operating activities was $6.0 billion, as compared with $4.1 billion for the three months ended September 30, 2007. Net cash provided by operating activities during the twelve months ended December 31, 2007, increased to $16.5 billion, as compared with $10.3 billion for the twelve months ended December 31, 2006. The increase is primarily due to the higher income and improvement in working capital management. Capital expenditures during the three months ended December 31, 2007, increased to $2.0 billion, as compared with $1.2 billion for the three months ended September 30, 2007. Capital expenditures for the twelve months ended December 31, 2007, increased to $5.4 billion, as compared with pro forma capital expenditures of $4.6 billion for the twelve months ended December 31, 2006. The increase is in line with the investments identified in the Company organic growth strategy. The Company expects to spend approximately $7.0 billion during 2008. ArcelorMittal's principal sources of liquidity are cash generated from its operations, its credit lines at the corporate level and various working capital credit lines at its operating subsidiaries An operating subsidiary is a business term frequently used within the United States railroad industry. In the case of a railroad, it refers to a company that is a subsidiary but operates with its own identity and rolling stock. . As of December 31, 2007, the Company's cash and cash equivalents, including restricted cash and short-term investments, amounted to $8.1 billion as compared to $7.2 billion at September 30, 2007. Net debt for the fourth quarter, which includes long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. plus short-term debt Short-term debt Debt obligations, recorded as current liabilities, requiring payment within the year. less cash and cash equivalents, restricted cash and short-term investments, was $22.5 billion ($22.2 billion as at September 30, 2007). Gearing9 decreased from 38% to 37% and net debt to EBITDA ratio increased to 1.2x at December 31, 2007, as compared to 1.1x10 at September 30, 2007. The Company had total liquidity of $16.7 billion at December 31, 2007 (as compared to $18.8 billion at September 30, 2007), consisting of cash and cash equivalents (including restricted cash and short-term investments) of $8.1 billion, and available bank lines (including bank lines at its operating subsidiaries) of $8.6 billion at December 31, 2007. Following the legal merger of Arcelor and Mittal Steel, most former Mittal Steel debt has been pushed down into ArcelorMittal Finance, which is the dedicated financing vehicle for ArcelorMittal. All ArcelorMittal Finance debt is fully guaranteed by its parent company, ArcelorMittal. 2007 Dividend and share buy-backs During 2007, the Company returned $4.4 billion to shareholders, consisting of $1.8 billion in cash dividends and $2.6 billion in share buy-backs. ArcelorMittal announced on September 4, the completion of the $590 million share buy-back program. In the aggregate, 9.5 million shares were purchased at an average price of $62.01 per share. ArcelorMittal completed the 27 million share buy-back program on December 13, 2007, for a total outlay of $2.0 billion with an average price of $72.39 per share. During the fourth quarter of 2007, the Company repurchased 19 million shares for a total cost of approximately $1.4 billion with an average price of $72.67 per share. On December 12, 2007 ArcelorMittal announced a new share buy-back program for up to a maximum of 44 million shares. This share buy-back program is aimed at offsetting the issuance of 44 million11 ArcelorMittal shares issued in connection with the ArcelorMittal legal merger on November 13, 2007. This program will be implemented over a two-year period. ArcelorMittal intends to use the repurchased shares for corporate purposes or to cancel them. During the fourth quarter of 2007, the Company acquired approximately 130,000 shares at a outlay of $9 million with an average price of $70.38 per share. As of February 12, 2008, an additional 5.6 million shares have been purchased under this 44 million share buy-back program for an outlay of $368 million with an average price of $65.99 per share Ratings On November 20, 2007, Standard & Poor's Ratings Services Ratings Service A company, such as Moody's or Standard & Poor's, that rates various debt and preferred stock issues for safety of payment of principal, interest, or dividends. raised its long-term corporate credit rating for the Company to "BBB BBB A medium grade assigned to a debt obligation by a rating agency to indicate an adequate ability to pay interest and repay principal. However, adverse developments are more likely to impair this ability than would be the case for bonds rated A and above. +" from "BBB" with a stable outlook. On December 14, 2007, Fitch Ratings Fitch Ratings An international rating agency for financial institutions, insurance companies, and corporate, sovereign, and municipal debt. Fitch Ratings has headquarters in New York and London and is wholly owned by FIMALAC of Paris. affirmed af·firm v. af·firmed, af·firm·ing, af·firms v.tr. 1. To declare positively or firmly; maintain to be true. 2. To support or uphold the validity of; confirm. v.intr. its rating of ArcelorMittal at "BBB" and revised its outlook for long-term Issuer Default Rating to Positive from Stable. On January 17, 2008, Moody's Investors Service Moody's Investors Service A leading global credit rating, research and risk analysis firm. Moody's Investors Service A leading firm engaged in credit rating, risk analysis, and research of fixed-income securities and their issuers. upgraded its rating of ArcelorMittal from Baa3 to Baa2. 2008 dividend As announced on November 14, 2007, ArcelorMittal's Board of Directors has recommended to increase the Company's base dividend by 20 cents from US$1.30 to US$1.50. The policy reconfirms a mechanism that will allow ArcelorMittal to honor its commitment of returning 30% of net income to shareholders through an annual base dividend, supplemented by additional share buy-backs. Based on the annual net earnings announced for the twelve months ended December 31, 2007 of $10.4 billion, ArcelorMittal will return a total of $3.1 billion to shareholders by paying a cash dividend of approximately $2.1 billion and implementing a $1.0 billion share buy-back. This distribution policy was implemented as of January 1, 2008. Recent Developments Carbon steel initiatives * On February 6, 2008, ArcelorMittal announced that it had been awarded a license from the Industrial Development Authority of the Egyptian Ministry of Trade and Industry to construct a steel plant in Egypt. Under the terms of the license, the plant will produce 1.6 million tons of steel using DRI See Digital Research. technology, and 1.4 million tons of billets through an electric arc furnace An electric arc furnace (EAF) is a furnace that heats charged material by means of an electric arc. Arc furnaces range in size from small units of approximately one ton capacity (used in foundries for producing cast iron products) up to about 400 ton units used for secondary route. * On February 4, 2008, ArcelorMittal announced that it had acquired from Clarion A family of application development systems for Windows from SoftVelocity, Inc., Pompano Beach, FL (www.softvelocity.com). Clarion provides a comprehensive set of tools for development, including a screen builder, 4GL and application generator. Del Norte Del Norte can refer to multiple things:
S/A Service/Agency S/A Special Agent S/A Spectrum Analyzer S/A Situational Awareness S/A Selective Availability (GPS satellite mode) S/A Services/Agencies S/A Sub-Assembly and Trefileria Colima S/A, the only major long carbon steel company in Costa Rica, that it did not already own. Laminadora Costarricense S/A has a rolled products capacity of 400,000 tonnes per year of rebars and merchant bar quality, and Trefileria Colima S/A has a wire products capacity of 60,000 tonnes per year. * On December 18, 2007, ArcelorMittal announced that it had signed an agreement with the administration of the Tver region in Russia that will lead to the creation of a green-field long carbon steel production unit. This steel complex will be built in two phases. In the first phase, a bar mill with a capacity of 600,000 tons of rebars and merchant bars will be built. Work on the site is expected to start during the second quarter of 2008 and commissioning of the mill is scheduled for the beginning of 2010. * On December 11, 2007, ArcelorMittal announced plans to build a $380 million beam mill in Contrecoeur, Canada, subject to appropriate agreements. This will entail entail, in law, restriction of inheritance to a limited class of descendants for at least several generations. The object of entail is to preserve large estates in land from the disintegration that is caused by equal inheritance by all the heirs and by the ordinary the restructuring of its steel production activities in Canada. Flat carbon steel production will be consolidated in Hamilton (at the Dofasco facility) and long carbon production in Contrecoeur (at ArcelorMittal Montreal). In connection with this restructuring, the Contrecoeur site will close its hot mill operations and its cold mill operations. The capacity of the beam mill in Contrecoeur, Canada will be 800,000 metric tons. * On December 7, 2007, ArcelorMittal announced it had entered into a business cooperation agreement with China Oriental oriental having some connection with the Orient. oriental avian eye fluke see philophthalmusgralli. oriental blood fluke schistosomajaponicum. oriental cattle plague see rinderpest. Group Company Limited ("China Oriental") and its subsidiaries. In addition, ArcelorMittal entered into a shareholders' agreement shareholders' agreement n. an employment agreement among the shareholders of a small corporation permitting a shareholder to take a management position with the corporation without any claim of conflict of interest or self-dealing against the shareholder/manager. with the controlling shareholders of China Oriental regarding their shareholdings in and the management of China Oriental. On December 14, 2007, ArcelorMittal launched a mandatory cash tender offer to acquire all of the outstanding share capital in China Oriental. On February 5, 2008, ArcelorMittal announced the completion of its general offer to shareholders in China Oriental. The transaction is subject to formal governmental approval. Mining activities * On January 31, 2008, ArcelorMittal announced that it had signed agreements to acquire three coal mines and associated assets in Russia for a total consideration of $720 million. The Company will acquire a 97.59% stake in the Berezovskaya Mine together with a 99.35% stake in the Pervomayskaya Mine from OAO OAO Orbiting Astronomical Observatory OAO Over and Out OAO One And Only OAO Ontario Association of Orthodontists OAO Owned and Operated OAO Ontario Association of Optometrists OAO Opticians Association of Ohio OAO Orthogonalized Atomic Orbital Severstal in Russia. Both mines produce coking coal and are located in the Kemerovo region in Russia. As part of the agreement, ArcelorMittal will also acquire the exploration and mining rights to the Zhernovskaya-3 coal deposit, which is a subsidiary of the Pervomayskaya Mine. Annual production from the three operating mines - which have a combined estimated total reserve of more than 140 million tons - is 3.14 million tons RoM in 2007. The Zhernovskaya-3 coal deposit has an additional estimated reserve of 46 million tons. All the transactions are subject to regulatory approval. * On January 8, 2008, ArcelorMittal announced the signing of a memorandum of understanding A Memorandum of Understanding (MoU) is a legal document describing a bilateral or multilateral agreement between parties. It expresses a convergence of will between the parties, indicating an intended common line of action and may not imply a legal commitment. with Societe Nationale Industrielle et Mini[c]re (SNIM SNIM Société Nationale Industrielle et Minière (French; Mauritania) SNIM Simultaneous Noise and Input Matching ), Mauritania, to jointly develop a large iron ore mining project, using the El Agareb iron ore resource in Mauritania. * On December 6, 2007, ArcelorMittal announced that it had signed an agreement to acquire the assets of OFZ OFZ Obstacle Free Zone (FAA) , a.s, one of the leading Central European manufacturers of ferro-alloys. OFZ is involved in the manufacture of a wide range of ferro-alloys on the basis of manganese manganese (măng`gənēs, măn`–) [Lat.,=magnet], metallic chemical element; symbol Mn; at. no. 25; at. wt. 54.938; m.p. about 1,244°C;; b.p. about 1,962°C;; sp. gr. 7.2 to 7. and silicon, namely ferromanganese fer·ro·man·ga·nese n. An alloy of iron and manganese used in the production of steel. , ferromanganese silicon and ferro-silicon. Other activities include the production of cored wires. Annual operating capacity of 150,000 tonnes, through the use of six furnaces, OFZ produced 141,000 tonnes of ferro-alloys in 2006. * On November 20, 2007, ArcelorMittal announced it had entered into a strategic equity partnership with Kalagadi Manganese, a South African manganese development company, in order to develop Kalagadi's manganese resources. The 50/50 joint venture aims to develop a manganese mine, a beneficiation beneficiation Treatment of raw material (such as pulverized ore) to improve physical or chemical properties in preparation for further processing. Beneficiation techniques include washing, sizing of particulates, and concentration (which involves the separation of valuable plant and a sinter sinter Mineral deposit with a porous or vesicular texture (having small cavities). Siliceous sinter is a deposit of opaline or amorphous silica that occurs as an incrustation around hot springs and geysers and sometimes forms conical mounds (geyser cones) or terraces. complex in the Northern Cape For other uses, see North Cape (disambiguation). The Northern Cape is a large, sparsely populated province of South Africa, created in 1994 when the Cape Province was split up. Its capital is Kimberley. Province of South Africa, and a smelter complex in Coega. Kalagadi Manganese project is situated in the Kuruman/Hotazel district of the Northern Cape Province. The parties intend to establish a manganese ore mine and sinter plant at Hotazel which will ultimately produce 2.4 million tons of sinter product per annum Per annum Yearly. . It will also see the establishment of a 320 000 tons per annum ferromanganese alloy alloy (ăl`oi, əloi`) [O. Fr.,=combine], substance with metallic properties that consists of a metal fused with one or more metals or nonmetals. production facility in the Coega Industrial Development Zone in Port Elizabeth Port Elizabeth, city (1991 pop. 670,653), Eastern Cape, SE South Africa, on Algoa Bay, an arm of the Indian Ocean. It is a tourist center and a major seaport that ships diamonds, wool, fruit, and other items. , which will account for at least 50% of ArcelorMittal's needs. * On November 20, 2007, ArcelorMittal announced it had signed an agreement to acquire a 12.6% equity stake (10% of fully diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. shares) in General Moly moly herb given by Hermes to Odysseus to ward off Circe’s spells. [Gk. Myth.: Odyssey] See : Protection , Inc. for a total consideration of $70 million. General Moly is a US based molybdenum molybdenum (məlĭb`dənəm) [Gr.,=leadlike], metallic chemical element; symbol Mo; at. no. 42; at. wt. 95.94; m.p. about 2,617°C;; b.p. about 4,612°C;; sp. gr. 10.22 at 20°C;; valence +2, +3, +4, +5, or +6. mineral development, exploration and mining company listed on the American Stock Exchange American Stock Exchange (AMEX) Stock exchange in the U.S. Originally known as “the Curb,” it began as an outdoor marketplace in New York City c. 1850. It moved indoors to its present location in the Wall Street area in 1921. . Their primary asset is the Mt Hope project located in central Nevada. Combined with a second molybdenum property, the Hall-Tonopah project, also located in central Nevada, the Company's aim is to become the largest primary molybdenum producer worldwide by the middle of the next decade. In addition to the equity purchase, ArcelorMittal has signed a letter of intent to enter into a long term off-take agreement. This agreement, subject to final documentation, would allow for the supply of approximately 6.5 million pounds per year of molybdenum. * On November 20, 2007, ArcelorMittal announced it had signed a memorandum of cooperation with the Republic of Mozambique. The memorandum of cooperation aims to strengthen cooperation between ArcelorMittal and the Republic of Mozambique through further investment in the primary and downstream From the provider to the customer. Downloading files and Web pages from the Internet is the downstream side. The upstream is from the customer to the provider (requesting a Web page, sending e-mail, etc.). steel industries, as well as the development of mining of raw materials in the form of iron ore and coal, with specific focus on metallurgical met·al·lur·gy n. 1. The science that deals with procedures used in extracting metals from their ores, purifying and alloying metals, and creating useful objects from metals. 2. coal. In respect of downstream steel capacity, ArcelorMittal plans to build a new bar rolling mill rolling mill: see steel. in Mozambique with a yearly capacity of 400,000 tonnes. Distribution * On December 24, 2007, ArcelorMittal announced that it had signed a share purchase agreement to acquire 100% of the shares of the Austrian steel distribution company Eisen Wagner GmbH. Eisen Wagner is one of the leading steel distribution companies in Austria. It sold 140,000 tons and out of this 60,000 tons of steel products were processed in 2007. * On December 4, 2007, ArcelorMittal announced its acquisition of NSD NSD Nairobi sheep disease. Limited, a leading steel distribution company specializing in sales of heavy sections and tubes based in Scunthorpe, North Lincolnshire North Lincolnshire is a unitary authority in the region of Yorkshire and the Humber in England. The 846 km² council area lies on the south side of the Humber estuary and consists mainly of agricultural land, including land on either side of the River Trent. , United Kingdom, in order to increase its commercial presence in the UK market. With 130,000 tonnes per year of sales (100,000 tonnes per year of heavy section and 30,000 tonnes per year of tubes) and PS60 million of turnover, NSD will form the basis of the drive to gain a significant market share for ArcelorMittal Distribution in the UK. Pipes and Tubes * On January 9, 2008, ArcelorMittal announced that it had entered into a definitive agreement to acquire Unicon, the leading manufacturer of welded steel pipes in Venezuela. The purchase forms part of ArcelorMittal's strategy to strengthen its welded steel pipes business 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. . Unicon supplies the Oil & Gas and Industrial & Construction sectors both domestically and overseas. Total shipments for the year ending March 2007 were 552,000 tonnes. All the transactions are subject to regulatory approval. * On November 29, 2007, ArcelorMittal announced its intention to construct a 300,000 metric tonne tonne measure of weight or mass; 1 tonne=1000 kg. See also ton. per annum longitudinal lon·gi·tu·di·nal adj. Running in the direction of the long axis of the body or any of its parts. submerged arc welded pipe mill in Nigeria. Downstream * On January 24, 2008, ArcelorMittal inaugurated Arceo, its industrial prototype for a vacuum plasma steel coating line in Li[c]ge, Belgium. Stainless Steel * On December 24, 2007, ArcelorMittal announced the acquisition of Cinter S.A, an important stainless steel distributor in Uruguay. The purchase forms a part of the strategy of ArcelorMittal to strengthen its stainless steel business in South America. Cinter S.A. enjoys a strong position in stainless steel tubes. It has also developed specialties that will complement the current offer of its stainless business. * On December 11, 2007, ArcelorMittal announced it acquired M.T. Majdalani y Cia. S.A., the leading stainless steel service center and distributor in Argentina. It sold about 12,000 tonnes in 2006. It specializes in flat stainless steel products with cut to length and slitting slit n. A long, straight, narrow cut or opening. tr.v. slit, slit·ting, slits 1. To make a slit or slits in. 2. To cut lengthwise into strips; split. facility. Disposals * On December 3, 2007, ArcelorMittal and Severstal-metiz announced that they had agreed on the sale of ArcelorMittal Wire Solutions' 50% stake in steelcord producer TrefilArbed Rus to Severstal-metiz. Other key events * On February 1, 2008, ArcelorMittal announced that it had agreed to a solution proposed by the federal and regional governments of Belgium Regional Governments of Belgium (the "Vlaamse Overheid" for Flanders, the "Gouvernement de Wallonie" for Wallonie and the "Brussel-Capital Region" for Brussels) work at a lower level to the Federal Government of Belgium. regarding carbon dioxide carbon dioxide, chemical compound, CO2, a colorless, odorless, tasteless gas that is about one and one-half times as dense as air under ordinary conditions of temperature and pressure. emission allowances and will consequently prepare for the relaunch Relaunch can refer to several things:
* On February 1, 2008, ArcelorMittal announced the results of its cash tender offer to acquire the 35.5% of outstanding shares in Acindar that it did not already own. ArcelorMittal announced that the cash tender offer for the Acindar shares had achieved a 98.6% participation rate. On February 14, 2007, the closing date, ArcelorMittal is expected to pay to the shareholders the amount of $552 million for the tendered shares. * On January 16, 2008, ArcelorMittal announced it had begun informational sessions and consultations with employee representatives regarding a reorganisation Noun 1. reorganisation - the imposition of a new organization; organizing differently (often involving extensive and drastic changes); "a committee was appointed to oversee the reorganization of the curriculum"; "top officials were forced out in the cabinet plan for its wire rod a metal rod from which wire is formed by drawing. See also: Wire operations in Gandrange (Lorraine, France) and in other European locations. For further disclosure about each of these recent developments, please refer to our website www.arcelormittal.com Outlook The Company expects first quarter 2008 EBITDA to be between $4.7 to $5.0 billion, comparable to fourth quarter 2007 levels. Total shipments in the first quarter of 2008 are expected to increase as compared with the fourth quarter of 2007. Flat Carbon Americas EBITDA is expected to benefit from improved steel selling price levels. EBITDA in the Flat Carbon Europe and Long Carbon Americas and Europe segments is expected to improve primarily due to volume increases. The Stainless Steel segment is expected to improve following increases in selling volumes. EBITDA in the AM3S segment is expected to decrease. The AACIS segment's performance is expected to decrease due to operating disruptions. The Company expects a depreciation charge of approximately $1.1 billion, on a quarterly basis. The Company expects to spend approximately $7.0 billion for capital expenditures in 2008. Furthermore, the Company expects an effective annual tax rate of between 20%-25%. [TABLE OMITTED] ARCELORMITTAL UNAUDITED CONDENSED con·dense v. con·densed, con·dens·ing, con·dens·es v.tr. 1. To reduce the volume or compass of. 2. To make more concise; abridge or shorten. 3. Physics a. CONSOLIDATED STATEMENTS OF INCOME [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] * EBITDA is defined as operating income plus depreciation and impairment. * Crude steel production is a combination of crude steel at the former Arcelor units and liquid steel at the former Mittal Steel units. * Some inter-segment and intra-segment sales have not been eliminated. * Some inter-company shipments have not been eliminated. * AM3S shipments are not consolidated and exclude all hirework and commission shipments from April 1, 2007 onwards. * Average steel selling prices are calculated as steel sales divided by steel shipments. * As from the fourth quarter 2007 onwards AM3S division includes buying and selling trading activity from the ArcelorMittal International business [TABLE OMITTED] * EBITDA is defined as operating income plus depreciation and impairment. * Crude steel production is a combination of crude steel at the former Arcelor units and liquid steel at the former Mittal Steel units. * Some inter-segment and intra-segment sales have not been eliminated. * Some inter-company shipments have not been eliminated. * AM3S shipments are not consolidated and exclude all hirework and commission shipments from April 1, 2007 onwards. * Average steel selling prices are calculated as steel sales divided by steel shipments. * As from the fourth quarter 2007 onwards AM3S division includes buying and selling trading activity from the ArcelorMittal International business [TABLE OMITTED] [TABLE OMITTED] * Some inter-company shipments have not been eliminated. * AM3S shipments are not consolidated in the combined company total Appendix 3 - Share buy-back [TABLE OMITTED] About ArcelorMittal ArcelorMittal is the world's number one steel company, with 320,000 employees in more than 60 countries. The company brings together the world's number one and number two steel companies, Arcelor and Mittal Steel. ArcelorMittal is the leader in all major global markets, including automotive, construction, household appliances and packaging, with leading R&D and technology, as well as sizeable captive supplies Captive supply is a term for that part of the supply that is not owned by a company but is used by the company to maximize its own profits often at the unknowing expense of those who actually own those supplies. of raw materials and outstanding distribution networks. An industrial presence in 27 European, Asian, African and American countries List of American countries Nations:
ArcelorMittal key pro forma financials for 2006 show combined revenues of USD USD In currencies, this is the abbreviation for the U.S. Dollar. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. 88.6 billion, with a crude steel production of 118 million tonnes, representing around 10 per cent of world steel output. ArcelorMittal is listed on the stock exchanges of New York (MT), Amsterdam (MT), Paris (MTP), Brussels (MTBL), Luxembourg (MT) and on the Spanish stock exchanges of Barcelona, Bilbao, Madrid and Valencia (MTS). 1 ArcelorMittal is the name of the entity resulting from the merger of (the former) ArcelorMittal into Arcelor on November 13, 2007. 2 EBITDA is defined as operating income plus depreciation and impairment 3 Excludes $1.3 billion of disposals 4 The financial information in this press release and Appendix 1 have been prepared in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with International Financial Reporting Standards International Financial Reporting Standards (IFRS) are standards and interpretations adopted by the International Accounting Standards Board (IASB). Many of the standards forming part of IFRS are known by the older name of International Accounting Standards (IAS). as adopted by the European Union European Union (EU), name given since the ratification (Nov., 1993) of the Treaty of European Union, or Maastricht Treaty, to the European Community ("IFRS IFRS International Financial Reporting Standard(s) IFRS Inter Frame Relay Service IFRS Indiana Facilities Registry System "). While the interim financial information included in this announcement has been prepared in accordance with IFRS applicable to interim periods, this announcement does not contain sufficient information to constitute an interim financial report as defined in International Accounting Standards 34, "Interim Financial Reporting". Unless otherwise noted the numbers in this press release have not been audited. 5 U.S. dollars have been translated into Euros using an average exchange rate (US$/Euro) of 1.4486, 1.3738, 1.2893, 1.3705 and 1.2558 for Q4 2007, Q3 2007, Q4 2006, 12M 2007 and 12M 2006, respectively. 6 Some inter-company shipments are not eliminated. Shipments for the fourth quarter include a (57kt) adjustment for elimination of quarter three 2007 inter-company shipments in the stainless segment. Inter-company transactions have been eliminated in consolidation. 7 Shipments for the fourth quarter include a (57kt) adjustment for elimination of quarter three 2007 inter-company shipments in the stainless segment. 8 AM3S shipments are not consolidated 9 Gearing is defined as net debt divided by total equity. 10 Based on 9M07 annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. EBITDA 11 Includes 12 million treasury shares 12 Shipments for the fourth quarter include a (57kt) adjustment for elimination of quarter three 2007 inter-company shipments in the stainless segment. Excluding this adjustment, quarter four shipments are 518kt and average selling price was $3,866 per ton. 13 Quarter four steel production includes (626kt) adjustment for double counting Double counting may refer to:
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