AMNS posts 187% jump in profits in Jan-Mar quarter

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May 07, 2021 5:30 AM

ArcelorMittal said the Indian business continued to perform ‘very well’. During the first quarter, AMNS India achieved ‘solid production’, annualising at 7.3 million tonnes (MT).

Overall, ArcelorMittal’s sales in the first quarter were at $16.2 billion against $14.2 billion for Q4’20 and $14.8 billion for Q1’20, mainly buoyed by surging prices of the material. ArcelorMittal recorded net income of $2.3 billion in the first quarter compared with a net loss of $1.1 billion in the same period last year.Overall, ArcelorMittal’s sales in the first quarter were at $16.2 billion against $14.2 billion for Q4’20 and $14.8 billion for Q1’20, mainly buoyed by surging prices of the material. ArcelorMittal recorded net income of $2.3 billion in the first quarter compared with a net loss of $1.1 billion in the same period last year.

ArcelorMittal Nippon Steel India (AMNS India) on Thursday reported a 187% year-on-year and 47% quarter-on-quarter increase in its earnings before interest, tax, depreciation and amortisation (Ebitda) at $403 million for the January-March period of the current year.

ArcelorMittal, or the erstwhile Essar Steel, follows a January-December fiscal. In the last quarter of 2020, AMNS India had clocked $274 million Ebitda and in the first quarter of 2020, its Ebitda was $140 million.

Essar Steel was acquired by AMNS through the insolvency route in December 2019 for over `42,000 crore.

The Indian operation, in which it has the majority 60% stake, contributed in a big way to help ArcelorMittal turn in its best-ever quarterly Ebitda in a decade at the group level during the January-March quarter of the current year at $3.2 billion compared with $1.7 billion in Q4’20.

Overall, ArcelorMittal’s sales in the first quarter were at $16.2 billion against $14.2 billion for Q4’20 and $14.8 billion for Q1’20, mainly buoyed by surging prices of the material. ArcelorMittal recorded net income of $2.3 billion in the first quarter compared with a net loss of $1.1 billion in the same period last year.

Commenting on the results, Aditya Mittal, chief executive officer, ArcelorMittal, said, “The first quarter of this year has been our strongest in a decade. While this is naturally a very welcome development following a highly challenging 2020, we are mindful that Covid continues to be a health challenge across the world especially in developing economies. Nowhere is this more obvious at present than in India, where we have our AM/NS India JV with Nippon Steel.”

ArcelorMittal said the Indian business continued to perform ‘very well’. During the first quarter, AMNS India achieved ‘solid production’, annualising at 7.3 million tonnes (MT).

“The company achieved $0.4 billion Ebitda (with an FY’21 run rate of $1.6 billion) with greater focus on exports markets. As a result, the business is already exceeding the level of Ebitda required to cover the cash needs of the business (maintenance capex and cash interest) of approximately $0.3 billion annually,” ArcelorMittal said in a statement.

The near-term plan for AMNS India involves de-bottlenecking the existing operations to achieve 8.6 MT capacity, while the medium-term the plan is to grow capacity at the Hazira complex to 14 MT.

“These growth plans are expected to be funded by the joint venture, utilising the cash the business is generating as well as its balance sheet capacity (currently has in excess of $1 billion in cash),” it said.

AMNS India is also developing its longer-term opportunities for growth and has signed an initial pact with the Odisha government to explore options for a greenfield integrated steel plant in the Kendrapara district.

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