ArcelorMittal Anticipates Increased Steel Demand Following Strong Q4
(This Feb. 6 story has been refiled to add the company's name in paragraph 1)
By Johan BODINIER and Anna Peverieri
(Reuters) - ArcelorMittal on Thursday forecast improving steel demand for 2025 and said its annual investment budget would be similar to last year's, after its fourth quarter earnings exceeded market expectations.
Shares of the world's second largest steelmaker rose 6.6% by 1042 GMT to their highest price since April 2024.
"Expectations for profit were weak in Europe. Demand is weak, but the company has been very profitable in Europe, indicative of the resilience of their business," J.P.Morgan analyst Dominic O'Kane said.
ArcelorMittal reported a 13% rise in its quarterly earnings before interest, taxes, depreciation and amortisation (EBITDA) to $1.65 billion, a nearly 8% beat to analysts' consensus provided by the company.
"The long-term outlook for the steel industry is positive and our global presence means we have a unique opportunity to prioritize investment in markets where there is a strong outlook for growth and returns," CEO Aditya Mittal said in a statement.
The Luxembourg-based company expects to invest between $4.5 billion and $5.0 billion this year, in line with its 2024 plans. Mittal said the primary investment focus would be in Brazil, India and the United States.
In a separate statement, ArcelorMittal said it would build a new steel plant in Calvert, Alabama to meet growing demand from U.S. automakers.
The group expects global steel demand to grow between 2.5% and 3.5% this year excluding China, the world's top consumer and producer of the metal.
It raised its dividend by 10% compared to last year and will pay out $0.55 per share for 2024.
ArcelorMittal shipped some 13.5 million metric tons of steel in the fourth quarter, slightly up from the same period in 2023 and from the third quarter.
Its Swedish peer SSAB also topped quarterly profit expectations last week, buoyed by resilient demand for its high-strength steel.
(Reporting by Anna Peverieri and Johan Bodinier in Gdansk; Editing by Milla Nissi)