ArcelorMittal (MT - Free Report) announced that its Flat Carbon Europe (FCE) division will supply about 140,000 tons of drawn and wall iron (DWI) steels to beverage can producers globally in 2013.
The steel giant will produce the DWI steel at its FCE Packaging Europe sites in Florange, France and Aviles, Spain. As per ArcelorMittal, the unique properties of its steel enable beverage can makers to produce 2,000 beverage cans per minute, with can walls of 60 micrometers (µm) thickness.
ArcelorMittal introduced metallurgical solutions in order to reduce the steel needed to produce a can and is acknowledged by beverage can makers as an innovative steel supplier. As per the company, one of the primary objectives of its customers is to reduce costs related to metal consumption which represents about 50% of the final cost of a beverage can.
ArcelorMittal aims to achieve this by reducing the metal thickness of can walls as the company plans to supply steel for cans with thicknesses between 0.190-0.180 millimeters (mm), well below current standard levels of 0.210 mm.
Steel cans are beneficial to the manufacturers and retailers in a number of ways as they can be branded easily, are easy to fill at high volumes, extremely rigid and tough at filling lines and at the point of sale, and are fully recyclable. ArcelorMittal has a dedicated team that works with the Association of European Producers of Steel for Packaging (APEAL) and is involved in the promotion of least-cost steel can recycling in Europe. The company offers steel to the entire beverage industry. Its customers are beverage can manufacturers in North America and Europe, including Ball and Crown.
Few weeks ago, ArcelorMittal released its second-quarter 2013 results. The company posted a net loss of $0.8 billion or 44 cents per share in the quarter compared with a net income of $1 billion or 66 cents per share a year ago. Barring one-time items (restructuring and impairment charges), loss was 32 cents per share. Analysts polled by Zacks were expecting earnings of 9 cents a share on average for the quarter. The results were impacted by lower pricing and weak demand.
Revenues declined 10.1% year over year to $20.2 billion in the reported quarter and missed the Zacks Consensus Estimate of $20.7 billion. Sales increased 2.3% on a sequential basis due to higher steel shipment volumes. Shipments declined 1.8% year over year to 21.3 million metric tons in the quarter.
ArcelorMittal currently maintains a Zacks Rank #3 (Hold).
Other companies in the steel industry with favorable Zacks Rank are Nippon Steel & Sumitomo Metal Corporation (NSSMY - Free Report) , Ternium S.A. (TX - Free Report) and Kobe Steel Ltd. (KBSTY - Free Report) . While Nippon Steel maintains a Zacks Rank #1 (Strong Buy), Kobe Steel and Ternium hold a Zacks Rank #2 (Buy).