ArcelorMittal turns $1.3 billion profit in second quarter

The ArcelorMittal Indiana Harbor complex in October, 2016, in East Chicago. The company grew second-quarter profits by 19 percent.

Jonathan Miano, The Times

ArcelorMittal grew its second quarter profit by 19 percent to $1.3 billion.

Over the first half of the year, the steelmaker turned a $2.3 billion profit, as compared to $696 million during the same period in 2016.

"We have materially improved our financial performance in the first half of 2017, and continue to make important progress on our Action 2020 plan," ArcelorMittal Chairman and Chief Executive Officer Lakshmi Mittal said. "Looking ahead demand remains strong in our core markets supporting robust order books and healthy levels of steel spreads. However, it remains a matter of concern that we are not able to capture the full benefits of this demand growth due to continued high levels of imports. We continue to work towards achieving a comprehensive trade solution in response to unfair imports."

The Luxembourg-based steelmaker's operating income was $1.4 billion during the second quarter and $3 billion during the first half, a 38.1 percent year-over-year increase.

ArcelorMittal, one of Northwest Indiana's largest employers, shipped 21.5 million tons of steel in the second quarter, a 2 percent increase over the first quarter. So far this year, its steel shipments have declined by 2.4 percent to 42.5 million tons.

"Given the improved macroeconomic environment, we have today increased our forecast for global steel demand by 200 basis points," Mittal said during a conference call with investors. "The strong demand backdrop is helping to support robust steel spreads."

In North America, operating income declined to $378 million, down from $396 million in the first quarter. The steelmaker's North American shipments dropped 3.4 percent to 5.4 million tons and crude steel production fell 7.3 percent to 5.8 million tons. 

Sales however grew 3.3 percent to $4.6 billion in North America because prices were up 5.7 percent.

"In terms of the North American market, I mean the North American market is still doing well," Mittal said during the conference call. "We are not overly concerned by the weakness in auto, the demand level is still very healthy. We continue to sell more of our advanced products into the U.S. automotive market. So overall the auto franchise in NAFTA is intact if not improving. Overall demand levels, price levels I think are healthy and I don’t see significant concern in our NAFTA business."

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Business reporter

Joseph S. Pete is a Lisagor Award-winning business reporter who covers steel, industry, unions, the ports, retail, banking and more. The Indiana University grad has been with The Times since 2013 and blogs about craft beer, culture and the military.