 "ArcelorMittal March quarter results: Core profit at $1.96 bn, tops forecast")
ArcelorMittal, the world's second-largest steelmaker, on Thursday reported first-quarter earnings ahead of analyst expectations and reiterated it expects global steel demand outside China to increase 3-4 per cent this year.
The Luxembourg-based company said its first quarter core profit (EBITDA) was $1.96 billion, higher than the average forecast in a company poll of $1.81 billion, but lower than $2.14 billion reported a year before.
Profit was primarily driven by improved results in North America, Brazil, Europe, India and from its joint ventures, offset by lower mining segment results, it said.
Despite customers taking a "wait and see" approach in an uncertain economic outlook, the company said low inventories, particularly in Europe, set the foundation for a rebound in demand.
The steel industry has been suffering from weak construction activity in Europe and problems in the real estate sector in China, the world's top consumer and producer of the metal. In the United States, interest rate hikes have dented demand.
The World Steel Association last month forecast a 1.7 per cent rise in global steel demand in 2024, as Chinese demand continues to decline.
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ArcelorMittal's shares were up 1.5 per cent at 0856 GMT.
JP Morgan warned that lower margins in Europe reflected less ability to pass through rising operating costs, though lower raw material prices in the second quarter could become a tailwind.
Steel demand in Europe, which has been challenged by high inflation and tighter monetary policy, is expected to show very modest growth this year, the World Steel Association has said.
The boss of Spanish steelmaker Acerinox said last week the European Union should do more to curb steel imports from Asia, which are hurting some of the EU's mills as demand and prices weaken.