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ArcelorMittal's (MT) Q1 Earnings Beat Estimates, Sales Lag
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ArcelorMittal (MT - Free Report) recorded profits of $2,285 million or $1.93 per share in the first quarter of 2021 against a loss of $1,120 million or $1.11 in the year-ago quarter. Earnings per share beat the Zacks Consensus Estimate of $1.57.
Total sales increased around 9.1% year over year to $16,193 million in the quarter. However, the figure missed the Zacks Consensus Estimate of $16,515 million. Sales were driven by higher average steel selling prices as well as higher iron ore prices and shipments, partly offset by the impact of ArcelorMittal USA disposal.
Total steel shipments remained flat year over year at 16.5 million metric tons in the reported quarter. Average steel selling prices were up around 24.8% year over year. The steel giant benefited from improved market conditions in the first quarter.
NAFTA: Sales plunged roughly 41.1% year over year to $2.5 billion in the reported quarter. Crude steel production declined roughly 60.5% year over year to 2.2 million metric tons. Steel shipments fell around 54.6% year over year to 2.5 million metric tons. Average steel selling price increased 19% year over year to $850 per ton.
Brazil: Sales increased around 57.7% year over year to $2.5 billion. Crude steel production rose roughly 13.3% year over year to 3 million metric tons. Shipments increased 22% year over year to 2.8 million metric tons. Average steel selling price went up 30.4% year over year to $837 per ton.
Europe: Sales increased around 22.2% year over year to $9.4 billion. Crude steel production fell roughly 2.2% year over year to 9.7 million metric tons in the reported quarter. Shipments fell around 3.1% year over year to 9 million metric tons. Average steel selling price went up roughly 27.4% year over year to $813 per ton.
Asia Africa and CIS (ACIS): Sales rose around 38.9% year over year to $2 billion. Crude steel production totaled 2.7 million metric tons, down about 10.5% year over year. Shipments dropped 1% year over year to around 2.6 million metric tons. Average selling prices rose around 37.3% year over year to $647 per ton.
Mining: Sales climbed 70.7% year over year to $1.7 billion. Iron ore production totaled 13.3 million metric tons, down around 7.6% from the year-ago quarter’s levels. Iron ore shipments rose 14.1% year over year to 9.8 million metric tons.
Financials
At the end of the first quarter, ArcelorMittal had cash and cash equivalents of around $5.5 billion, up around 27.3% year over year. The company’s long-term debt was $8.6 billion, down roughly 19.7% on a year over year basis.
Net cash from operating activities rose 67.8% year over year to $997 million for the quarter.
Outlook
Moving ahead, ArcelorMittal envisions global apparent steel consumption (“ASC”) to increase 4.5-5.5% in 2021. The figure suggests an improvement from a contraction of 1% in 2020. The global steel industry is now benefiting from a favorable supply-demand balance and a low inventory environment, the company noted. ArcelorMittal sees ASC to grow year over year in 2021 in all of its core markets.
The company revealed its priorities for the rest of the year, which includes maintaining a competitive cost advantage, to strategically grow through high-return projects in high-growth markets. It also intends to leverage existing infrastructure to develop its iron-ore resources, consistently return cash to shareholders through a defined capital return policy as well as lead on sustainable development.
Price Performance
Shares of ArcelorMittal have surged 183.2% in the past year compared with 157.6% rise of the industry.
Zacks Rank & Other Key Picks
ArcelorMittal currently sports a Zacks Rank #1 (Strong Buy).
Some other top-ranked stocks in the basic materials space are Dow Inc. (DOW - Free Report) , Nucor Corporation (NUE - Free Report) and Impala Platinum Holdings Limited (IMPUY - Free Report) .
Dow has a projected earnings growth rate of roughly 261.5% for the current year. The company’s shares have surged 101.1% in a year. It currently flaunts a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Nucor has an expected earnings growth rate of around 228.4% for the current year. The company’s shares have gained 126.8% in the past year. It currently sports a Zacks Rank #1.
Impala has an expected earnings growth rate of 197.6% for the current fiscal. The company’s shares have skyrocketed 215% in the past year. It currently flaunts a Zacks Rank #1.
+1,500% Growth: One of 2021’s Most Exciting Investment Opportunities
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ArcelorMittal's (MT) Q1 Earnings Beat Estimates, Sales Lag
ArcelorMittal (MT - Free Report) recorded profits of $2,285 million or $1.93 per share in the first quarter of 2021 against a loss of $1,120 million or $1.11 in the year-ago quarter. Earnings per share beat the Zacks Consensus Estimate of $1.57.
Total sales increased around 9.1% year over year to $16,193 million in the quarter. However, the figure missed the Zacks Consensus Estimate of $16,515 million. Sales were driven by higher average steel selling prices as well as higher iron ore prices and shipments, partly offset by the impact of ArcelorMittal USA disposal.
Total steel shipments remained flat year over year at 16.5 million metric tons in the reported quarter. Average steel selling prices were up around 24.8% year over year. The steel giant benefited from improved market conditions in the first quarter.
ArcelorMittal Price, Consensus and EPS Surprise
ArcelorMittal price-consensus-eps-surprise-chart | ArcelorMittal Quote
Segment Review
NAFTA: Sales plunged roughly 41.1% year over year to $2.5 billion in the reported quarter. Crude steel production declined roughly 60.5% year over year to 2.2 million metric tons. Steel shipments fell around 54.6% year over year to 2.5 million metric tons. Average steel selling price increased 19% year over year to $850 per ton.
Brazil: Sales increased around 57.7% year over year to $2.5 billion. Crude steel production rose roughly 13.3% year over year to 3 million metric tons. Shipments increased 22% year over year to 2.8 million metric tons. Average steel selling price went up 30.4% year over year to $837 per ton.
Europe: Sales increased around 22.2% year over year to $9.4 billion. Crude steel production fell roughly 2.2% year over year to 9.7 million metric tons in the reported quarter. Shipments fell around 3.1% year over year to 9 million metric tons. Average steel selling price went up roughly 27.4% year over year to $813 per ton.
Asia Africa and CIS (ACIS): Sales rose around 38.9% year over year to $2 billion. Crude steel production totaled 2.7 million metric tons, down about 10.5% year over year. Shipments dropped 1% year over year to around 2.6 million metric tons. Average selling prices rose around 37.3% year over year to $647 per ton.
Mining: Sales climbed 70.7% year over year to $1.7 billion. Iron ore production totaled 13.3 million metric tons, down around 7.6% from the year-ago quarter’s levels. Iron ore shipments rose 14.1% year over year to 9.8 million metric tons.
Financials
At the end of the first quarter, ArcelorMittal had cash and cash equivalents of around $5.5 billion, up around 27.3% year over year. The company’s long-term debt was $8.6 billion, down roughly 19.7% on a year over year basis.
Net cash from operating activities rose 67.8% year over year to $997 million for the quarter.
Outlook
Moving ahead, ArcelorMittal envisions global apparent steel consumption (“ASC”) to increase 4.5-5.5% in 2021. The figure suggests an improvement from a contraction of 1% in 2020. The global steel industry is now benefiting from a favorable supply-demand balance and a low inventory environment, the company noted. ArcelorMittal sees ASC to grow year over year in 2021 in all of its core markets.
The company revealed its priorities for the rest of the year, which includes maintaining a competitive cost advantage, to strategically grow through high-return projects in high-growth markets. It also intends to leverage existing infrastructure to develop its iron-ore resources, consistently return cash to shareholders through a defined capital return policy as well as lead on sustainable development.
Price Performance
Shares of ArcelorMittal have surged 183.2% in the past year compared with 157.6% rise of the industry.
Zacks Rank & Other Key Picks
ArcelorMittal currently sports a Zacks Rank #1 (Strong Buy).
Some other top-ranked stocks in the basic materials space are Dow Inc. (DOW - Free Report) , Nucor Corporation (NUE - Free Report) and Impala Platinum Holdings Limited (IMPUY - Free Report) .
Dow has a projected earnings growth rate of roughly 261.5% for the current year. The company’s shares have surged 101.1% in a year. It currently flaunts a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Nucor has an expected earnings growth rate of around 228.4% for the current year. The company’s shares have gained 126.8% in the past year. It currently sports a Zacks Rank #1.
Impala has an expected earnings growth rate of 197.6% for the current fiscal. The company’s shares have skyrocketed 215% in the past year. It currently flaunts a Zacks Rank #1.
+1,500% Growth: One of 2021’s Most Exciting Investment Opportunities
In addition to the stocks you read about above, would you like to see Zacks’ top picks to capitalize on the Internet of Things (IoT)? It is one of the fastest-growing technologies in history, with an estimated 77 billion devices to be connected by 2025. That works out to 127 new devices per second.
Zacks has released a special report to help you capitalize on the Internet of Things’s exponential growth. It reveals 4 under-the-radar stocks that could be some of the most profitable holdings in your portfolio in 2021 and beyond.
Click here to download this report FREE >>