The Luxembourg-based firm had posted a net loss of USD 711 million in the year-ago period, it said in a regulatory filing.
However, net profit during the period witnessed a fall of 39 per cent on quarterly basis to USD 680 million compared with USD 1.11 billion in the June quarter.
The April-June period profit included exceptional income of USD 832 million relating to a one-time gain on employee benefits that followed signing of the new US labor contract in June 2016.
On a sequential basis, the decline in sales was lower at 1.5 per cent from USD 14.74 billion in April-June 2016.
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The world's largest steel maker forecasted that profits will be impacted in the October-December period compared to September quarter on account of "impact of lower US steel prices and higher coking coal prices".
Commenting on the performance, Mittal, who is Chairman of ArcelorMittal, said: "Our third quarter results reflect the progress the company is making to improve the underlying performance of the business, as well as improved market conditions since the start of the year."
Compared to July-September 2015, sales fell by 4 per cent from 21.1 MT.
Its net debt fell to USD 12.2 billion as of September 30, 2016, compared to USD 12.7 billion on June 30 and USD 16.8 billion on September 30, 2015.
"Taking into account an expected full-year investment in operating working capital of around USD 1 billion (versus previous estimate of about USD 0.5 billion), the firm expects cash flows from operating activities to exceed capex in 2016," ArcelorMittal said.
"While expectations are for steel prices to align with the increased costs, in the interim the higher coal price will impact steel spreads and fourth quarter performance."
Overcapacity remains a concern, reinforcing importance of a comprehensive trade response to minimise impact of unfair trade across all product categories, he added.
ArcelorMittal's net debt decreased by USD 0.5 billion to
USD 12.2 billion in the September quarter in the previous three months, funded largely by cash inflow from operations (which included a USD 0.6 billion investment in working capital and USD 0.2 billion of premiums paid on early repayment of debt) and asset sale proceeds (USD 0.2 billion).
On raw material requirements, the steel giant said the requirements of iron ore are about 115 MT annually, of which around 63 MT is produced internally and about 11 MT is procured via strategic contracts.
The Group's annual coking coal consumption is around 35 MT of which 6-7 MT is produced internally. In addition, it consumes about 9 MT of pulverized injection coal (PCI).
On increase in its capex, the company said the operating working capital guidance for FY 2016 of around USD 1 billion primarily to reflect higher average steel selling prices and higher raw material costs during the year.
"Our expectation for demand growth in 2016 versus 2015 has been revised up slightly to about 0.5 per cent (from 0-0.5 per cent forecast last quarter)," it said.
Specific changes include a decrease in the US of between 0-1 per cent (from 2-3 per cent) and an increase in Europe to between 1-2 per cent (from 0-1 per cent), it added.
"Our forecast for declines in CIS remain unchanged (5-6 per cent), while in Brazil we have further cut our forecasts and now expect consumption to contract by between 12-14 per cent in 2016 (from previous 10-12). In China, our view of demand has marginally improved since Q2 2016 to 0-0.5 per cent (from previous 0-1 per cent)," ArcelorMittal said.