Global steel giant ArcelorMittal on August 1 posted a net loss of USD 0.447 billion during the June 2019 quarter, mainly due to higher cost of raw materials and low steel prices.
The company had posted net income (attributable to equity holders of the parent) of USD 1.865 billion in the year-ago period, the company said in a statement.
The company has posted a "net loss of USD 0.447 billion in the second quarter of 2019", the statement said.
ArcelorMittal follows January-December financial year.
Sales increased to USD 19.3 billion during the quarter as against USD 19.2 billion in the year-ago period, registering a marginal rise of 0.5 percent.
On plans to acquire debt-ridden Essar Steel, the company said: "Net cash provided by other investing activities in 1Q 2019 of USD 254 million primarily includes USD 0.3 billion due to the rollover of the Indian rupee hedge at market price, which protects the dollar funds needed for the Essar transaction as per the resolution plan approved by the Committee of Creditors and the National Company Law Tribunal in Ahmedabad, offset in part by the quarterly lease payment for the ArcelorMittal Italia acquisition (USD 51 million)".
ArcelorMittal India - a subsidiary of ArcelorMittal - had submitted a competitive resolution plan for ESIL.
Commenting on the results, company's Chairman and CEO Lakshmi N Mittal said, after a strong 2018, market conditions in the first half of 2019 have been very tough, with the profitability of the company's steel segments suffering due to lower steel prices combined with higher raw material costs.
This, he said, has been only partially offset by improved profitability from our mining segment, and the company has generated healthy free cash flow, demonstrating the improved robustness of the business following Action 2020 plan.
Mittal also said that "global overcapacity remains a clear challenge. We have reduced capacity in Europe in response to the current weak demand environment, which has also impacted the turnaround of the ex-Ilva facilities in Italy.
"Further action needs to be taken to address the increasing level of imports entering the continent due to ineffective safeguard measures and we continue to engage with the European Commission to create a level playing field for the sector," he added.
On outlook for the second half of the year, the company said, "it expects global steel demand in 2019 to grow by 0.5 percent to 1.5 percent (ex-China steel demand growth of +0.5 percent to +1.0 percent; US +0 percent to +1.0 percent; and Europe to contract by between -2.0% to -1.0 percent)".
The company said its gross debt was at USD 13.8 billion as of June-end this year.