The world's largest steel maker, ArcelorMittal, today reported a net loss of 0.8 billion for the second quarter of this year due to heavy inventory write-downs and workforce reduction programmes.
"The loss in the second quarter of 2009 resulted from exceptional charges amounting to $1.2 billion primarily related to write-downs of inventory ($0.9 billion) and provisions for workforce reductions ($0.3 billion)," the NRI billionaire L N Mittal-promoted company said in a statement.
The company had a profit of $5.8 billion in the same quarter of the last fiscal.
ArcelorMittal saw its sales plunging by nearly 60 per cent to $15.2 billion in the reporting quarter compared to the period a year ago due to fall in steel demand and prices.
"The main reason for the decline continues to be the extreme weakness in demand for steel products in 2009 as a result of the global economic crisis, along with a steep fall in prices," it added.
However, the company is hopeful of a demand revival in the second half of the year and is mulling the rollback of 50 per cent production cuts at some of its facilities.
"In recent weeks we have started to see some initial signs of recovery, as a result of which we are now planning to re-start production at some facilities. Provided there are no further unexpected economic deteriorations, we should see continued gradual improvement throughout the second half of the year," Mittal said.