Slide 1: 3Q 2020 Financial Results and Strategic update
APPENDIX 3Q 2020 Financial Results and Strategic update, November 5, 2020 • SECTION 1 | Capital allocation 2 • SECTION 2 | Trade 7 • SECTION 3 | Financial highlights 9 • SECTION 4 | Macro highlights 16 • SECTION 5 | Sustainable development 20 • SECTION 6 | Steel investments 25 Page 1
Slide 2: Capital allocation
“_< ArcelorMittal CAPITAL ALLOCATION
Slide 3: Capital allocation
Capital allocation Building resilience and strong foundations for future returns Building the strongest platform for consistent capital returns to shareholders $7bn net debt achieved (supports IG Resilient Robust balance sheet credit metrics through the cycle) platform Organic brownfield opportuniti
Slide 4: Mexico: HSM project
Mexico: HSM project High return project to optimize capacity and improve mix Project summary: • New hot strip mill project to optimize capacity and improve mix • $1bn project initiated in 4Q’17; HSM expected completion 2021 • 2.5Mt HSM to increase share of domestic market (domestic HRC spreads are s
Slide 5: AMNS India update
AMNS India update Domestic demand recovery post COVID-19 lockdowns lifted Performance: • Demand recovered post COVID-19 lockdowns with a V-shaped recovery government stimulus has boosted economy • Safe ramp up of production – currently running capacity in all sites • 3Q’20 crude steel production
Slide 6: ArcelorMittal Investco (Italy)
ArcelorMittal Investco (Italy) New agreement modified to ensure long term sustainability of the asset • In light of COVID-19, revised investment plan submitted to Ilva Commissioners during 2Q’20 Proposed labour agreement modified to ensure long term sustainability of the asset • Industrial plan: 8
Slide 7: Trade
“_< ArcelorMittal TRADE
Slide 8: Trade policy in core markets EU/NA to provide protection
Trade policy in core markets EU/NA to provide protection Our core markets are increasingly protected by policies to address unfair trade Europe: • European steel industry has been subject to AD/AS duties imposed since 2017 – including HRC against several countries (China, Brazil, Russia, Iran, Ukrai
Slide 9: Financial highlights
“_< ArcelorMittal FINANCIAL HIGHLIGHTS
Slide 10: 3Q'20 EBITDA to net results
3Q’20 EBITDA to net results Net loss in 3Q’20 BASIC EPS 3Q’20 ($ million) Net impairment gain consists of the partial reversal of Weighted Av. No. of shares (in millions) 1,228 impairment charges recorded following the announced sale of ArcelorMittal USA ($660m), and an impairment Loss per share $(0
Slide 11: 3Q'20 EBITDA to free cashflow
3Q’20 EBITDA to free cashflow Positive FCF driven by working capital release ($ million) (203) (520) 1,072 1,770 1,250 901 EBITDA Change in Net financial cost, Cash flow from Capex Free cash flow working capital* tax and others operations Page 11 * Change in working capital: trade accounts receivabl
Slide 12: 3Q'20 net debt analysis
3Q’20 net debt analysis Net debt decreased as of September 30, 2020 vs June 30, 2020 ($ million) During 3Q 2020, the Company Includes forex on debt paid dividends of $55m to mainly due to the 4.6% minority shareholders of depreciation of USD vs. ArcelorMittal Mines Canada EUR (AMMC) and Bekaert (Bra
Slide 13: 9M'20 EBITDA to net results
9M’20 EBITDA to net results Net loss in 9M’20 driven by weak steel performance impacted by COVID-19 pandemic ($ million) BASIC EPS 9M’20 Weighted Av. No. of shares (in millions) 1,120 Loss per share $(1.73) Includes inventory related charges in NAFTA and Europe Includes MTM losses of $127m related t
Slide 14: 9M'20 EBITDA to free cashflow
9M’20 EBITDA to free cashflow Positive FCF driven by working capital release ($ million) 571 (480) (1,771) 2,575 2,666 895 EBITDA Change in Net financial cost, Cash flow from Capex Free cash flow working capital* tax and others operations Page 14 * Change in working capital: trade accounts receivabl
Slide 15: 9M'20 net debt analysis
9M’20 net debt analysis Net debt decreased as of September 30, 2020 vs December 31, 2019 including positive FCF, proceeds of $2bn capital raise offset by forex ($ million) On May 11, 2020, ArcelorMittal announced an offering of common shares and mandatorily convertible (895) notes (MCN) for $2.0bn (
Slide 16: Macro highlights
“_< ArcelorMittal MACRO HIGHLIGHTS
Slide 17: Demand recovery supported by economic stimulus
Demand recovery supported by economic stimulus Inventories are low and demand has recovered; pace and sustainability of recovery uncertain • Demand in our core markets has recovered post the COVID-19 impact, with higher activity levels and automotive particularly recovering • European Green deal and
Slide 18: Regional inventory
Regional inventory Inventory levels in key regions in line with historical averages German inventories (000 Mt)* US service centre total steel inventories (000 Mt) (latest data point: Aug-2020) (latest data point: Sep-2020) 5.0 13,000 3.4 1,400 Germany Stocks 12,000 USA (MSCI) Months Supply (RHS) 3.
Slide 19: China exports are down
China exports are down Significant reduction in net exports on MoM and YoY basis China net exports* (000 Mt) (latest data point: Sep-2020) 12 Exports of finished steel products Imports of finished steel products 10 Net-trade 8 • Sept 2020 net exports 0.9Mt (-35% vs Aug 2020); -78% vs Sept 2019 6 • S
Slide 20: Sustainable development
“_< ArcelorMittal SUSTAINABLE DEVELOPMENT
Slide 21: Sustainable development runs throughout our Company
Sustainable development runs throughout our Company Our purpose is to invent smarter steels for a better world • Our 10 Sustainable Development (SD) outcomes • Our innovations offer our customers solutions to enhance their provide a compass to describe the business we know contribution to a low carb
Slide 22: Smart Carbon – our technologies
Smart Carbon – our technologies Torero Carbalyst (Steelanol) Industrial scale demo plant in Industrial scale demo plant in Ghent, Ghent, Belgium converting waste Belgium capturing carbon off-gases biomass into biocoal via two and converting into 80m litres reactors, each producing 40kt bio- recycled
Slide 23: Making carbon-neutral steel: Innovative DRI-based route
Making carbon-neutral steel: Innovative DRI-based route H2 Hamburg Industrial scale demo producing direct reduced iron via 100% hydrogen 100% hydrogen at existing plant in Hamburg, Germany H2 to produce 100,000t sponge iron pa Status: Research project and feasibility study ongoing Page 23 Production
Slide 24: Policy requirements – the 'missing pieces'
Policy requirements – the ‘missing pieces’ The medium-term market conditions needed include: • Creating an environment where net zero steel is more competitive than steel which is not • A fair competitive landscape that accounts for the global nature of the steel market, addressing domestic, import
Slide 25: Steel investments
“_< ArcelorMittal STEEL INVESTMENTS
Slide 26: New Ford Bronco
New Ford Bronco Using newer, lighter steel made in Alabama at ArcelorMittal • ArcelorMittal was selected as the sole Gen 3 steel supplier for the 2021 Ford Bronco, the first automobile in the world to incorporate ArcelorMittal Fortiform® 980 GI, which is made at the AM/NS facility in Calvert, Alabam
Slide 27: Brazil: Vega high added value capacity expansion
Brazil: Vega high added value capacity expansion High return mix improvement in one of the most promising developing markets Project summary: Investment to expand rolling capacity → increase Coated / CRC capacity and construction of a new • HAV expansion project to improve mix 700kt continuous annea
Slide 28: Dofasco - Hot strip mill modernization
Dofasco - Hot strip mill modernization Investments to modernize strip cooling & coiling flexibility to produce full range of target products • Replace existing three end of life coilers with two state of the art coilers, new coil inspection, new coil evacuation and replace runout tables and strip c
Slide 29: ArcelorMittal Contacts
ArcelorMittal Contacts Daniel Fairclough – Global Head Investor Relations Maureen Baker – Fixed Income/Debt IR daniel.fairclough@arcelormittal.com +44 207 543 1105 maureen.baker@arcelormittal.com +33 1 71 92 10 26 Hetal Patel – UK/European Investor Relations Donna Pugsley – Investor Relations Assist