BUSINES Markets 07 Feb 2013, p.11 Weak demand knocks ArcelorMittal SA Group posts wider loss, affected by economy, global price pressures MARK ALLIX Industrial Correspondent ARCELORMITTAL SA STILL REELING ARCELORMITTAL SA yesterday reported a headline loss of R518m ARCELORMITTAL SA . Headline loss of for the year ended December, Share price, daily close (cents) R510m citing depressed economic condi- 4800 tions and weak steel demand, Close: 3645 which were made worse by deadly 4400 * Depressed economic labour unrest. conditions and weak SA's largest steel maker said 4010 this compared with a loss of R52m steel demand in the previous year. It also said 3600 the poor result highlighted SA's Worsened by deadly dependence on Europe as an 3200 labour unrest export market for downstream metal products. 2800 *0.63% "ArcelorMittal SA's results . Highlights SA's reflect the difficult environment 2400 dependence on Europe that the company is currently 0 N D facing," Kagiso Asset Manage- 12 as an export market ment equity analyst Ross Heyns NONKULULEKO NYEMBEZI-HEITA said yesterday. Mr Heyns said the internation nal steel price was under pressure ARCELORMITTAL SA 27% plunge in commercial coke building and construction sector, because of excess global capacity, Full year 2012 2011 sales. The drop in coke sales was the largest consumer of steel, con- and the South African unit of the Revenue (Rbn) 32.3 because of the shutdown of fur- tinued to be sluggish. The firm world's biggest steel maker also 31.4 said that on a compounded basis, faced "additional domestic and Pretax (Rm) (692) 126 naces by ferrochrome producers Net Profit (Rbni) (508) 8 participating in Eskom's electric- steel demand in the country had company-specific issues". Diluted HEPS (c) (13) only grown at an annual average "The company has experi- (129) ity buyback programme. These producers accounted for about rate of 1.1% over 20 years. enced significant cost pressure Dividend (C) 90% of such sales. Rand prices of key raw over the past few years, electricity result of weak demand and de- "As anticipated, 2012 was a materials such as coking coal, continues to increase and the stocking in the second half of the very tough year," ArcelorMittal pellets and scrap were down, Sishen (iron-ore) cost plus supply year, even as net realised prices in SA CEO Nonkululeko Nyembezi- while electricity costs rose 16%. agreement is in dispute," he said. rand terms rose by 7%. Heita, said yesterday. On a brighter note, the com- Domestic demand was important, Earnings before interest, tax, "At the same time, we are pany said it realised a net cash because ArcelorMittal SA depreciation and amortisation fell pleased with the strides we have inflow of R445m for the year, received a "significantly higher 35% to Rl.12bn from Rl.72bn in made in achieving operational sta- bringing its closing cash position price" for its domestic steel sales 2011. bility and containing costs," she to R884m, up from R439m in the than for exports, Mr Heyns said. This was due to a "modest said. previous year. Domestic sales fell 5% as a drop" in domestic steel sales and a Demand from the domestic a ixmebutm.coza