ArcelorMittal (Euronext:MT) Q3 2026 Earnings Call

0:00 Good afternoon, everyone. This is Daniel Farquhar from the Arslan Mittal Investor Relations team. Thank you for joining this call to discuss Arslan Mittal's performance and progress in the third quarter of 2026. Leading today's call will be our CFO, Mr. Germino Cristina. Before we begin, I would like to mention a few housekeeping items. As usual, we will not be going through the results presentation, which was published this morning on our website. However, I do want to draw your attention to the disclaimers on slide 24 of that presentation. Following some opening remarks from Joe Meadow, we will move directly to the Q&A session. So if you'd like to ask a question, then please do press star 1 1.

0:55 Thanks Daniel, welcome everyone and thanks for joining today's call. As usual I will keep my remarks brief. Let me begin with safety, which remains our highest priority.

1:20 We are now approaching the end of the second year of our safety transformation. Through disciplined execution of our safety roadmaps, we are seeing more consistent performance across the group. This is encouraging, and we remain firmly focused on our ambition of achieving zero fatalities and zero serious injuries as quickly as possible. Turning now to the business, I would like to focus on three key points. First, our results continue to demonstrate the structural improvement margins. Third quarter of 2016 was $2 billion, a 34% year-on-year.

2:07 The beta per ton increased to $155 billion. which is $44 higher than a year ago and well above historical averages. This demonstrates that our portfolio optimization and strategic execution are delivering results and I believe there is significantly more to come. Importantly, these results do not yet reflect The full benefits of the new European trade framework, which is restoring sustainability to the European steel industry.

2:52 And given the length of our order book, the increases in steel prices flow through to earnings with a lag.

3:03 In addition, around 25% of our European flat product volumes remain under annual contracts that have yet to reset. This brings me to my second point. As imports normalize, customers are increasingly looking to domestic supply and we are responding. The TRQ framework provides the opportunity for recently idle capacity to restart. Thank you very much. Thank you very much. which is counter to the normal seasonal pattern.

4:11 As inventory is normalized, we expect more of this reduction in imports to translate into higher domestic shipments. Our order book continues to strengthen and we expect shipment growth to accelerate in the fourth quarter and show a double-digit year-on-year improvement.

4:38 is expected to continue to build into 2027.

4:45 As customers shift back towards domestic skill supply, we will see higher, more sustainable capacity utilization, with Davrova, Asturias, and Ford back in operation, All of our European glass furnaces are now running and we are well-placed to serve our customers reliably and efficiently. High utilization should support the return to healthy and sustainable levels of profitability and returns on capital across the industry. My third and final point is that Arsenal Mittal is exceptionally well positioned to deliver higher earnings, stronger returns on capital, and continued value creation for shareholders.

5:42 An increasingly regionalized steel market provides a stronger foundation for sustainable profitability throughout the cycle. I have already talked about the significantly improved outlook for our business in Europe. Our business in India continues to perform well. We are ramping up our higher added value capacity. In the year to September, we presented a new shipment record. In North America, we are seeing positive momentum across our franchise. Better import protections are a common theme. and Lean Inventories alongside growing demand from data centers, energy, infrastructure investments, created a positive outlook for 2027. Against this improved backdrop, Acelermittal is well positioned to succeed.

6:40 Our scale, our leadership positions in key markets, and our strong track record of product and process innovation will continue to set us apart from the competition. We are proud of the entrepreneurial culture which promotes accountability and a relentless focus on continuous improvement. A more supportive industry structure gives us an even greater opportunity to convert disadvantages Over the past four years, we have invested consistently in high return strategic growth projects that are increasing our earnings capacity.

7:32 Importantly, many of these projects have not yet reached their full potential. providing a further source of earnings growth as we move into 2027 and beyond.

7:46 The value created through these investments is further enhanced by our buyback program.

7:57 This has been a powerful driver of shareholder value. And given the positive outlook for free cash flow this year and beyond,

8:08 I expect this to continue.

8:12 With that, Daniel, I believe we can start the Q&A. Great. Thank you, Jim. We know we have quite a long list of questions to get through, but we'll start with a question from Alain at Morgan Stanley.

8:32 Hi, Alain. I forgot to ask you my question.

8:36 Hi, hi. Two questions from my side. I'll start with the first one, which is the usual one. If you don't mind discussing the profit bridge into Q4 and specifically around Europe, where we are seeing many moving parts, including shipment growth, spot prices moving higher, but also elevated or sticky energy costs. Perhaps the same question applies to the other divisions as well.

9:00 So if you don't mind starting with the bridge. Thank you.

9:08 Thanks Alain. Looking at the major components, the building blocks, the major themes into the fourth quarter, I think it's clear from Gemmino's comments and the release that we expect higher volumes in the fourth quarter. Thank you very much. Second component would be generally higher steel prices across the segments.

10:05 The Brazil, perhaps a slight exception to that, just given mixed effects, so that's probably going to be a little bit more stable quarter to quarter. The third bucket or theme would be higher costs. You know, you talk about that in your question, the way you posed it. Thank you very much. continue over the next six weeks or so, so it's difficult to be specific there on the guidance, but that will clearly be a theme.

10:55 The last component would be mining. We've guided to a stronger quarter to end the year from our mining segment, given the continued progress at Liberia and our expectation that that should be operating Thank you very much. If you look at our release, if you look at the presentation, we are expecting a good free cash flow performance in the fourth quarter and that will be in substantial part driven by an expected seasonal release of working capital.

12:04 Thank you, Daniel. Thank you.

12:05 And my second question is, if we stay with Europe into 2027, you talked about the annual contract three steps. Do you mind reminding us how many tons will be out for repricing on the 1st of Jan and how quickly this will feed through your ASB? And then in Europe as well, in your presentation, you talk quite extensively about the benefits of the TRQ framework, which hasn't fully yet fed through your profits and margins. What do you expect to see as we head into early 2027 that will drive the margin upside for your European division?

12:42 Thank you.

12:46 Thank you.

12:48 Let me take your second question. First of all, I think it's important to to say that TIQ Q3, of course, was the first quarter in which we could see the benefits of the new framework. We are, of course, very happy with what we have seen. As we were guiding at the time of quarter two, we see higher shipments in flat despite the seasonality and despite the fact that We were going through a disk talk during the quarter. So it's really working as initially designed, which should then allow us to bring back the capacity that I also talked about at the beginning in my opening remarks.

13:50 and we will really see the full benefits of the new framework, of course, in 2027. And also what it does, and we believe it should really be extremely helpful It allows the industry now to base on higher costs, right? So we are seeing now, we were in a positive trend in terms of recovering our margins. Of course, we were hit by higher energy costs, but we are in the process of recovering that. So when I look at the pricing guidelines that we have already for January, I'm sure you have seen it. It's already significantly higher than what you see at the moment coming from the index. So that's all very positive.

14:47 And we're going to be working through the destocking. Our expectation is that destocking should largely end in Q4. So when I look at the business and the moving parts, I think we can be very optimistic for 2027. And then just coming to your question on contracts, Alan, so I think in our release, in the presentation, you can see and you already know that 25% or approximately 25% of our flat volumes in Europe are annual contract.

15:38 That's predominantly with the automotive customers. and the significant majority of those contracts follow the calendar year. So a significant majority of that 25% of our flat volumes is set to reprice as we start 2027. Thank you. Thank you very much. Great. Thanks, Alan. So we'll move now to take a question from Reinhardt at Bank of America. Hi, Reinhardt. Afternoon, Gino and Daniel. Thank you very much for the time.

16:36 I just want to ask about the European furnace restart so far. Can you give us an update on where exactly they are in their ramp-up process and when you think they're going to hit steady-state production? I guess related to that, it would be good to get your thoughts on when you think there will be enough demand in Europe for

16:59 So first of all, we are bringing capacity as we see demand, right?

17:08 I think that's number one, I would say.

17:10 So we are not bringing capacity unless, of course, we can see that in our order books. and that's why we feel confident to bring that to capacity because we have seen all the books strengthening So in terms of the run paths, as you know, it's not easy to bring back capacity, especially when the finances have been idle for some time, which was clearly the case here. So for Poland, we are now up and running since the end of September.

17:58 So we have basically completed the run path. The finances are running well.

18:03 Forth, we are still going through the run-up phase. Not yet where we want to be, but progressing there.

18:15 And in Spain, we are up and running. So two out of three finances are running well, and Forth is still in the process of run-up.

18:29 Got it. That's good. And comment on slabs, if you can.

18:36 Sorry, what was your question on the slabs?

18:41 When you expect the demand to be sufficient in Europe for it to make sense for you to bring in slabs into the continent.

18:51 Well, I mean, look, I mean, this is something that, of course, remains a possibility for us. Our focus right now is to ramp up our capacity domestically so that we can utilize our existing finances and tools that we have here. But of course, we have that flexibility.

19:14 We know

19:16 already. What is the potential for higher volumes next year? Just because of the TRQ and low imports that we expect to materialize, we want to see the full benefits in 2027, right? But we believe that we will have the capacity to take care of that. But as a group, we have a That's very clear, thank you. And maybe just one more question on developments into 4Q. You've previously called out that some of this new capacity does have higher carbon costs associated with it.

20:06 So, as you're building volumes into the fourth quarter, how should we think about improved fixed cost absorption and EBITDA per ton from that volume increase?

20:20 Our message is the same. So, yes, as we bring back capacity, there will be more CO2 costs. But fixed costs, we shouldn't be really adding much in terms of fixed costs. So profitability of this volume should be at least as far with the existing business, if not a little bit better.

20:51 Very clear. Thank you very much, Janino and Daniel.

20:57 Great. Thanks, Reinhard. So we'll move now to take a question from Tristan. Thank you for taking my questions. I have two. The first one is on Europe.

21:16 One of you, Peter, said that the shutdown of ILVA would be a game changer for the market.

21:24 Do you share that view? And do you see a scenario where southern European prices would trade at a premium to northern prices? And does that mean ultimately there could be upside risk to the market share gains you initially contemplated? That would be my first question. Yeah, look, I mean, we all know in which levels ADI was running at, right? So we all know.

22:15 And it was not running at a very high level.

22:22 And as a company with Steel, we are in a good position here to service that market. As you know, we have a restarted port, a second financing port in the south. We restarted also our financing in Spain. So it places us in a very good position to supply the market in the south. WebRise is finally settling in the South. I mean, historically, as we know, South has always traded prices, always at a discount loss because of the more exposed to imports, which, as we know now, has been corrected by TRQ.

23:11 So we'll see where we finally, where prices finally settle. I wouldn't expect that to trade at a significant premium, but it will depend on trade and other aspects. But again, I think for us, it's a good opportunity to service that market from our facilities in the south. to run that comment. So I think, you know, I really, I think as we look out there, I wouldn't say ILVA is going to have a significant impact. Just reinforcing Gemwina's comment that they've been operating at very, very low levels.

24:08 So the fact, you know, if they... Drop down a little bit further, I don't think it's really going to change that supply-demand balance notably, so I wouldn't expect any significant or material impact on the market. All right, that's very clear. And my second question is on North America. Can you discuss a little bit the striking fact in Canada and also what happened in Mexico? Is there anything structural at play given it's been a couple of quarters with some hiccups? and how much of those, I mean, if you could quantify those one-offs and how much you expect to get back into Q4, that'd be great. Thank you.

25:08 Sure. So we had two events in North America. One was the strike in our law division in Canada. that has been addressed. The facility is up and running since the beginning of the quarter, so there shouldn't be any further impact from the strike. So back to normal levels. and in that school we had reliability issues with our DRI facility, which has also been resolved to trans. So I would expect us to be running at a normal capacity in quarter four. And the negative impact, could you quantify it?

26:07 So we are talking about in Q3, I mean, the losses, I would say in the range of 150 kg.

26:16 All right. Thank you.

26:26 Great. Thanks, Tristan. So we'll move now to take a question from Ephraim at Citi. Hi, Ephraim. Please come up. Thanks, Daniel. Two questions, I'll just take them in turn. First, I'm just trying to gauge how conservative your guidance for double-digit uranium growth in flat products while shipments in Europe is for Q4. Very rough math. I mean, you did about 6.5 million tons in total last year in Europe. 70% assume that is flat. So a 10% implies somewhere around a 450,000 tons increase year-on-year for Q4 2026. But if imports are coming down by 2.5-3 million tons per quarter and you maintain your market share of about 30%, I mean, you should be expecting about 700 to 800 or 900,000 tons increase.

27:34 Thank you very much. Thank you. Well, I think we've got all the moving parts right. I think the only one that I would also point to you, and as we discussed before as well, is, so we are still going through what we believe is the D-Spark in Europe, which, as I said, should normalize an algorithmic report in Q4, which then should, of course, help us as we start 2027.

28:26 So I think that's the only missing piece that I would point to you. Is there anything else here you want to highlight? No, Gemina, yeah, it's a good question there, Pramod, and thanks for putting it forward, because as Gemina said, you're picking up the moving parts there, and it's because inventories are really providing a cushion over the second half period as we transition into this new mechanism. So we saw the reduction in imports in Q3. We're going to see, we expect to see that similar reduction in imports in Q4.

29:14 But because inventories are being consumed through that period, it's not fully translating yet Thank you very much. That momentum is going to continue, so it's going to provide a good foundation for the bridge into Q1 and 2027 as a whole as well.

30:13 Thank you.

30:15 Sorry, my second question is on India and Sazera. Obviously, now you're saying ramp up or start in 2027, which was obviously flat a little bit earlier. But should we kind of realistically expect any shipments from the incremental, any new capacity in 27 or is it really a 28-story in terms of more volumes? And could you kind of give us a sense as to where we are in the completion of construction processes and ramp-up processes in terms of the incremental 6 million capacity there?

31:01 Yeah, sure. So I can maybe comment on that. So as you know, we have already commissioned the downstream. So the new code, new automotive lines for the finishing. So we are testing now the new co-op open batteries. We are making good progress with the upstream, the finances. And we do expect to see already in 2027 high volumes coming from the project. Our expectation is that in the first half of 2027 we'll start to see already some action there.

31:52 We will, of course, provide you guys with some more guidance on that as part of our Q4 results, but we should definitely see already some improvements in 2027, especially in the second half.

32:12 Thank you.

32:16 Thanks, everyone. So we're going to move now to take a question from Timnit at Wells Fargo. Hi, Timnit.

32:24 Yeah, hey, good afternoon. I wanted to switch gears to the Americas, if I could, and beginning with Brazil. The investments you're making there are pretty notable. How do you stay comfortable with the outlook there given smaller cities

32:42 to create protections, the recent election, and at least one of your other competitors that I was sounding a bit more cautious than you are.

32:50 So if you could elaborate on the Brazil strategy, please.

32:55 To be honest, I could not hear well the question. Have you heard it?

33:01 Yes, I have. So perhaps I can start, Jeremy, now. The Outlook for Brazil given the election results, what our plans are for investments, would we reconsider them given the election outcome, given the relative lack of trade protection? and noting that one of the competitors, I think on the long side of things, was giving a more sombre outlook for the market.

33:51 Yeah. Okay. Thank you. Great. So, look, I mean, I think we have to differentiate between low and flat in Brazil. When we look at the flat business, we do believe that at least for steel, I mean, we have already good levels of trade protection. So, we had recently, until developing on coal, We have seen imports coming down to normal levels, so they were quite high. We have more to come, so we have a team that will be now also coming on HRC against China. So we feel that the government has taken steps to support the business on the platform side.

34:57 We also have some questions, maybe not as much as we would like to see, and we continue to engage with the government. And where you see us investing right now in Brazil is in the flat side of the business, with more downstream, which is the country's short. So it's important exactly that. And we feel that it will make a lot of sense for us to convert exports into more domestic products. And that's exactly what we are trying to do.

35:41 Okay, thanks. Sorry if it wasn't clear. I was referring to a flat-rolled producer, but your results in Brazil were quite strong, so maybe a different perspective. Switching gears, if I could, to the North American market, You also have some repricing, I would assume, there. So we'd like to hear on the repricing and the perhaps benefit from any lower CRU discounts we've been hearing about. And then on the Calvert performance, we've been hearing some challenges maybe on the ramp up there. What could that look like when fully optimized, I guess?

36:22 So we continue to make progress with the ramp-up in Calvert. Of course, to be honest, it's moving a little bit slower than what we were expecting. But our expectation is to exceed the, it's a very good run rate. As you know, I mean, with this finance, we expect to produce very demanding, a skill for many applications, exposed alternatives.

36:58 But it's progressing.

37:00 It should provide good support for 2027 because, of course, Each ton that we can produce locally is one ton of slab that we're not going to need to pay salaries. So that should really support the business and profitability in North America in 2027. I'm sorry, your line for me at least is not great. So I think the first part of the question was linked to auto contracts. But it resets. The name was And just to pricing dynamics and discounts to index, etc., whether that's evolving.

37:50 Yeah, look, I mean, as we know, prices in North America, they are strong. The supply demand is strong. So we are seeing tightness in the market. and what is also very positive for us specifically is the fact that we are also seeing similar dynamics in Canada and in Mexico as well. So we should not forget that. We are a North American operations business, which at the beginning of the year we were seeing a larger discount in Canada and Mexico to CRE.

38:38 And now we are kind of back to the normal levels of normal parity that we used to see. before the new Section 232 and powers against Canada. Daniel, please.

38:58 Yeah, go ahead.

39:00 Oh, I was going to say, if I could take one last stand, of course, on DeFasco, any thoughts on a potential benefit from CARVAD or any insights you might have there on the trade negotiations?

39:20 Yeah, I think we're going to need to wait and see what finally what is agreed. I cannot really comment much on that. We'll have to wait for the final What I can say, though, is that we are doing well in Canada.

39:40 Our business is doing well.

39:43 I mean, we adapted as much as we could. Of course, supported also by trade measures from the Canadian government. We see lower levels of imports. As I said, supporting the prices and demand for facilities. So, yeah, we're doing well. And given where prices are right now, we give us also a good level of confidence that 2027 again should be significantly better. So we'll take the next question from Boris Ashuro.

40:34 Hi Boris, please go ahead. Hi, thank you for taking my question. I have two ones. The first, let's stay in the U.S., but now that the Trump administration has been defeated in the midterms, do you see a potential impact on Section 232 tariffs, or do you believe things will stay exactly the same? That's the first question. And second, on slide 22, you mentioned the increasingly supportive regulation in Europe for the industry. What is the main support you see among those measures that come on top of the TRQ and when do you expect them to have their first impact? Thank you.

41:31 Thanks for picking this one up from the appendix. It is an important slide and what we're showing on slide 22 is that the that the trade and policy environment in Europe does continue to evolve and so you know we're all very pleased to be seeing the impact of T-BAM from the beginning of the year and we've talked a lot about the new tariff rate quota mechanism Thank you very much.

42:46 In terms of CBAN moving downstream to capture extensive goods, that's going to be very important. And that's something that we're expecting to hear from relatively soon. What the outcome of the trialogue discussions there, so maybe end of this year, early next year, we should see some news on that. But I think moving downstream, capturing the derivative products, that's very, very important.

43:34 And then in terms of the evolution of the tariff-free quota tool, we've had the question earlier around slab. So slab imports on a near-term basis, not necessarily something to be concerned about. But on a medium-term basis, that is certainly something that we would be concerned about. A scenario where primary steelmaking capacity in Europe gets replaced by imported slab. So that's clearly very counter to the intentions of the tariff rate quota. The intentions of the tariff rate quota mechanism are to restore the industry to health Thank you very much.

44:58 should also capture those slaps. And that's something that we're expecting to hear about at the next opportunity, which would be actually in the middle of next year.

45:13 Hopefully that's clear.

45:18 Yeah, so maybe I think there was also a question on section 232 in the rest of the case. So maybe a few comments from us. So I believe we have to acknowledge, right, that section 232 has been a very effective policy addressing the impacts of global access capacity and unfair trade. We believe that it remains pretty much the direction of travel, not only in the U.S., but in all coal markets. Steel is strategic. It's vital to resilient domestic supply chains.

46:08 They need appropriate protection, we believe. So we have seen U.S. policy work well in reducing imports, promoting investments. We have seen, of course, a number of investments in place. We know that Section 232 was also supported by the Democrats before. And our expectation is that Section 232 Thank you very much.

46:38 So we'll move now to take a question from Max. Hi, Max.

47:01 Yeah, good afternoon, Glenn. So, yeah, first question is on Europe and really zooming in on the long product segment. It seems to be considerably weighing on your operations there.

47:20 It's working on EF, so I guess it's very much concerned by the higher electricity costs.

47:26 It doesn't seem to be as impacted by the TRQ system as the flat products. And construction is the main market, so also there are the pressures. Do you see some prospects for this business to earn its cost of capital? And if not, what is the future of this business within ArcelorMittal?

47:51 Yeah, sure, Mark.

47:52 Let me take this one. So first of all, we like our long business. It's a franchise business, and we have high-quality products that are very important. And just an example, rails, heavy beams that we are exporting to different parts of the world at very good levels of price. So it's, as you know, over the years, we have... and many others. So what you see really in Q3, and I think the dynamics that we are seeing are very much similar to what we talked about before. We saw also in 4-3-4 longs a significant reduction of impulse. But at the same time, that was offset by the shortening that we also talked about in the case of flat.

49:05 And so we should also normalize, right? And the same dynamics in terms of prices moving up So I would expect the same dynamics that we talked about to impact our long-distance as well. Okay, and the second and last question is on Ukraine, so can you perhaps quantify the residual costs associated with these operations, not that they are run in Gold Idol format, and more generally, Production has come to a halt in Ukraine. All other facilities have also stopped.

50:00 Do you see any impact on the European market, also perhaps on the world iron ore market, given that Ukraine was a significant producer? Yeah, so this is all, of course, we're very sad with the developments in Ukraine. As we speak, we are in the process, so we are idling the facility as we have guided. Going forward, from a cash flow point of view, our expectation is that it will be very limited needs to supply cash.

50:49 So we're going to be liquidating, of course, the existing banisteries that we have, so that we will take care of the needs of the facility for And then after that, our expectation is that we are talking about a minimal amount just to keep the security of the site. So it should be a low number just to keep the optionality here for the future.

51:34 Okay, in terms of wider impact on the European market, is it positive?

51:41 I don't think, look, as we know, the capacity in Ukraine was already sitting in its country impacted, right? And there is also, they have also quota. So I wouldn't expect, to be honest, to see a significant impact on the European market because we were not really exporting to Europe.

52:14 So I don't expect anything significant. Okay, let's go.

52:24 Great. Okay, thanks, Mike. So we'll take the next question from Andy at UBS. Hi, Andy.

52:36 Hi, Daniel. Thanks, genuinely. I just want to ask about the demand... ..support factors in Europe with regards to the... Oh, hello, can you hear me?

52:55 You're breaking up quite a bit there actually, Andy, so can you start your question again?

53:01 Yeah, sorry, is this clearer?

53:06 Hopefully, yes. So I was just going to ask about the demand situation. What are you seeing in terms of your end markets, in terms of demand evolution after the summer lull?

53:22 Has demand recovered as you would have expected? Has it been softer? Any impact from the, obviously, the higher interest rate environment and energy costs as well?

53:34 Are you seeing that in your order book or are we making too much of that given the headlines we see? Andy, the real demand in Europe, what we see, is relatively stable. I don't see, to be honest, I don't see change to what we were seeing before.

54:03 So what is clear, what is the dynamics that we see, the real demand is relatively flat.

54:12 We see the automotive is resilient. What we are seeing really is the big stock, right, that we talked about. So that, of course, had an impact on the appearance to consumption in Europe in Q3. We should continue to to be the case in Q4, not to the same extent, less. And then after that, our expectation is that we normalize, inventory normalize, which again, leave us in a good place to restart 2020, 2027. As we know, I mean, I'm sure you have seen PMIs in Europe at stationary levels.

55:03 Clearly, the energy story doesn't help, right? But so far, I cannot really say that it has had a significant impact. Any other books? Other books are strong. So we are fully booked for quarter four. So we're taking orders now really for next year. Okay. Yes, I do. And just to make sure, Andy, you're appropriately sort of noting the specific comments that we've given this quarter and also for the fourth quarter, that we did see counter-seasonal progress in Q3.

55:52 The momentum is building. Thank you very much. Thank you very much. That's clear. And just as a follow-up to Efrem's question, I mean, if you take FOSS plus Poland and the Spanish blast furnace, I mean, between all of those, it should probably be about 5 million tonnes of pig iron or more. I mean, on a quarterly basis, I'd expect that to be shifting, lifting shipments by at least a million tonnes on a normalised basis compared to what you were doing.

56:57 The first half, which would put you above 8 million tonnes a quarter. Once we get through this destocking period, which is obviously weighing on 4Q and the negatives, do you expect shipments to be running at 8.1, 8.2 million tonnes a quarter by the time we're in the first half of 2017? Well, I think we all know the math, right? I mean, we talked about what we expect in terms of decline in imports. That number is not changing, right? I think what is to be seen is how the real demand in 2027, right?

57:53 And to the extent that we are restocking now, I mean, you could also imagine that at some point in 2027, we may also need to, we may also see some restocking, right? So then we will have to see and wait. We are not yet providing guidance in terms of parents' consumption for 2027, but if you just look at the World Steel Association, they came out with their forecast, they had a 2-3% increase for Europe next year, which if it materializes, of course, comes on top, right, of the lower imports that we are expecting. That is all very positive.

58:41 Okay, thanks very much.

58:45 Thanks, Andy. So we'll move now to take a question from Bastian at Deutsche Bank.

58:52 Hi, Bastian.

58:54 Yeah, thanks, James. All of my questions have been answered. No problem. Thanks, Bastian. So we'll move now to take a question from Carl at Jefferies. Hi, Carl. Good afternoon, thanks for taking my question. Just some clarifications on this side. On the other division, are you giving any quantification of kind of an estimated EBITDA or progression into the fourth quarter? And then on North America, you talked about the positives into 2027 of Thank you for joining us.

1:00:06 Yeah, so maybe first on segment orders. So typically what we guide for segment orders is an expense of about $200 million for the year, right? So about $50 million to court. This court in particular, it's positive, slightly positive. because we have a significant release of Intercompany Profits. So volumes from our mining division that sits in Europe as and when the profitability of these funds comes down and I don't know if volumes comes down also in Europe.

1:00:58 So then that gets released and that's what you see this quarter. and also an improvement in the results in South Africa. So that's why it's positive, this quote is slightly positive. But everything being normal, I mean, it should be about $15 million or so negative. In North America, specifically for Calvert, so as you know, our contract increase has already expired. So we have replaced that proportionally with another contract with US Steel that is in place and will continue to be in place for some more years.

1:01:53 And then an opportunity for us there, as I said at the beginning, is the run-up of the electric arc furnace so that we can reduce the amount of the slabs that we import. and that's the focus that the device is trying to achieve to get the components up and running in plate capacity as soon as possible.

1:02:26 Thanks for the clarification.

1:02:30 Great, thanks Carl. So I think We are going to take a question now from Matt at Goldman Sachs. Hi, Daniel. Hi. Just one question from me.

1:02:47 I think maybe more clarification. Your raw materials basket on slide eight, it's gone up by sort of 40 euros a tonne since August.

1:03:01 Can you just help me reconcile what's driving that? Because, you know, coal prices have increased, but iron ore has come off.

1:03:10 Is there something else happening there around the restocking for those furnaces but you don't yet have the volumes to divide that by? Can you just help me think about how that raw material box could move if we start to see coal prices ease?

1:03:32 Well, I believe that what we have in this slide is just a normal, it's cold, I don't know, and scrap, right?

1:03:44 Exactly, yeah, it's just a very sort of simplified...

1:03:49 A view of the raw material basket, excluding energy, alloys, etc. So, yes, like you said, Jen, we know just the key components and the input factors for scrap, iron ore, and met coal. No lags or anything, it's just the spot evolution.

1:04:16 All right, okay, so does this also include the freight of getting the draw materials to Europe, or was that excluded?

1:04:23 No, it's just the simplified basket.

1:04:30 Okay, all right, thank you.

1:04:35 Good stuff, thanks, Matt. So we'll take a question now from Dominic at J.P. Morgan. Hi, two quick follow-up questions for me. So just for avoidance of doubt, when we think about NAFTA for Q4, we should be expecting slightly higher shipments. And specifically, I just wanted to know whether Calvert would be seeing any downtime or maintenance aligned with the usual seasonal slowdown for NAFTA. My second question is obviously just given the normal seasonality of the working capital unwind and as we start to think about deleveraging, how should we think about capital allocation for Q4? Is the shareholder distribution still just...

1:05:37 Thank you very much. So maybe first in the U.S., North America business. So we talked about some of the impacts we face in quarter three in terms of shipments along business in Canada and Mexico. So that is not repeating. But at the same time, we do have seasonality, as you pointed out, and we will continue to see that. So all in all, I would expect our shipments in North America to be flat.

1:06:32 So we will, of course, have a recovery of the two events that I talked about, but at the same time, we will have and all the seasonality and maintenance that will happen. So our expectation is for shipments to be flat. So coming out towards the question of working capital, as we have been guiding, We do expect the large majority of the investment up to now to reverse, following all this analogy of our working capital.

1:07:18 That of course will provide strong support to free cash flow generation. Thank you very much. What I would say though is that based on everything that we just talked about, the good prospects for the business going forward in 2027, We believe that there is, of course, it's an opportunity for us to perhaps deploy more than the 60% that the policy would call for, right?

1:08:11 So it is something that we will definitely be discussing very seriously. And is that something that you can do outside of, do you need an EGM approval to do that type of distribution or could you do it within your existing authorisation? Yeah, we have the authorizations, enough authorizations to do it. And as always, when we have the DAGMs in May, we, to the extent that we need, we will get extra pool, but so far we have enough in our authorization to, we have plenty of flexibility.

1:09:05 Super, thank you.

1:09:09 Thanks Dominic. So we do have maybe one more minute to take a follow-up question from Tristan at BNP Paribas and then I'm going to hand back to you, Jim, we know for closing remarks, but Tristan, last question. Thank you, just a quick one on Liberia, if we can calibrate a bit better the volume up, taking Q4, if you can tell us how much volume you shipped in the nine months from Liberia, and any comments on the cost, if you think it's going to be relatively steady or not. Yeah.

1:09:54 Yeah, so up to now, nine months, we shipped about 10.5 million tons. So as you know, we are guiding now for 16. But what I would say is important here to keep in mind is that in Q4, our expectation is to be, for the first quarter, to be able to run at capacity. So, as you know, it's a 20 million tons project. So, we are wrapping up the... The concentrated lines, so we see already the capacity in rail and port to get to the 20 million in 2027, which is good. We're also taking steps to prevent issues as we face importatory inflation.

1:10:57 Thank you very much. Not only improve the mix, right, but we'll have a richer product. And as we increase capacity also, then costs should come down. And then it, again, places well for next year.

1:11:46 All right, that's clear.

1:11:49 And maybe if I squeeze one little more, just on the two projects you plan to confirm in Q4 in Brazil, the strategic growth project, is that still going to be within the CAPEX framework you discussed now for a number of years, 4.55 billion, or could that change a bit, the CAPEX framework? Yeah, thank you for that. Look, I mean, as you know, the project in Tubara, the cold rolling mill and Kotze, it's the project that has been approved.

1:12:35 It's been executed as we speak. It's not yet part of the 1.8 in terms of the big time that we expect to get from the project. We will be updating that in Q4 together with our guidance for CapEx. But at this point, I can All right, perfect. Thank you. Perhaps, Jeremy, I can just add a couple of points to your response. You're saying there's no change to CapEx spending or rate of spend still in that $4.5 to $5 billion range. So I think we've...

1:13:46 Thank you very much. previous question around capital allocation, what are we going to do with that cash and using that for our share buybacks given our positive outlook for the business, our view on our share price with buying back more stock with that free cash flow going beyond the minimum 50% would seem very appropriate.

1:14:47 So I think that's our last question, or certainly the last we have time for. Joe Minos, I'm going to hand back to you for any closing remarks. Thank you, everyone. Before we close, let me briefly reflect on the key message from today's discussion. First, our third quarter results again demonstrate improved earnings power of the business. And importantly, the full benefits of the new European trade framework are still to come too. Second, we have evidence that the new TRT mechanism is working as intended, imports are materially lower, our shipments are increasing, and momentum is building as inventories normalize.

1:15:41 ArcelorMittal is exceptionally well positioned as we move into 2027. We have positive momentum across our business. On top of the improving market backdrop, our strategic group investments provide a further source of earnings growth as projects continue to ramp up. So I leave you with the final message. I'm even more optimistic about the outlook for our business than I was three months ago. We have a strong portfolio, improving market conditions in our key regions, meaningful embedded growth, and a disciplined capital allocation framework. I'm confident in our ability to deliver high earnings, stronger returns on capital, and continued value creation for our shareholders.

1:16:37 With that, I will close today's call. And if you have any follow-up questions, please reach out to Daniel and his team. Thank you again for joining us.