ArcelorMittal, one of Northwest Indiana's largest employers, ended 2015 with a catastrophic fourth quarter, losing a stunning $6.7 billion over the last three months of the year.
The Luxembourg-based steelmaker, which employs around 10,000 workers in the Calumet Region, lost $7.9 billion last year. Chief Executive Officer Lakshmi Mittal called the results "sobering" in a conference call with investors.
The 2015 net loss of $7.9 billion included $4.8 billion of impairments, primarily due to mining impairments, and $1.4 billion of exceptional charges, primarily related to the write-down of inventory following the rapid decline of international steel prices, according to the company's earnings release.
The steelmaker, which is the largest in the world by volume, now hopes to raise $3 billion in new capital from shareholders to get its debt down to $12 billion. The company hopes to cut $1 billion in expenses in 2016 by reducing capital spending, not paying a dividend for 2015, and reducing interest expenses.
ArcelorMittal attributed the massive loss to the global import crisis that's widely blamed on China, which went from exporting 90 million tons of steel in 2014 to 120 million tons last year.
"2015 was a very difficult year for the steel and mining industries," Mittal said in a statement. "Although demand in our core markets remained strong, prices deteriorated significantly as a result of excess capacity in China."
Industry analysts say China has more than 500 million tons of steelmaking overcapacity. China's economy has slowed but it continues to make just as much steel, dumping it abroad with the help of government subsidies U.S. steelmakers don't get.
ArcelorMittal has tried to adjust to the difficult market conditions, such as by forcing salaried employees to pay more out-of-pocket for health care.
"Regrettably we have announced a disappointing net loss which includes non-cash impairment charges on our mining assets as a result of the very considerable fall in iron ore prices," Mittal said. "Looking ahead, although we have started to see a recovery in Chinese steel spreads, from 2015 lows, 2016 will be a very difficult year for our industries."