ArcelorMittal Hosts 2014 Investor Day - Analyst Blog

ArcelorMittal MT hosted its 2014 Investor day yesterday. The company reaffirmed its 2014 outlook of 3.5% to 4% growth in the global steel market. The company also discussed the different ways of adding value in steel.

ArcelorMittal highlighted its key value drivers and key enablers including a strong balance sheet, active portfolio management, a decentralized organizational structure and the best talent. The company stated that its medium-term earnings before interest, tax, depreciation and amortization (EBITDA) will be $150 per ton.  

Meanwhile, the company will streamline its management and reorganize its steel businesses by geography effective Jan 1, 2014. External reporting will follow this structure under the new segments: ACIS, Brazil (and neighboring countries), Europe, Mining and NAFTA.

ArcelorMittal also provided updates on its development and investment projects. The company announced revisions to phase II of its project in Liberia, which will enable it to supply 15 million tons per year of high quality sinter feed at significantly lower cost for the first eight to ten years. The company expects to incur total capital expenditure of about $1.7 billion for the revised phase II project.

ArcelorMittal further announced the possibility of growth at ArcelorMittal Mines in Canada. The company identified an expansion potential of 6 million tons per year to 30 million tons per year.

The company also provided an update on the automotive franchise business focusing on the acquisition of the ThyssenKrupp facility in Calvert Alabama from Japan's Nippon Steel & Sumitomo Metal Corporation NSSMY, now known as AM/NS Calvert.

ArcelorMittal currently carries a Zacks Rank #3 (Hold).

Other companies in the steel industry with favorable Zacks Rank are AK Steel Holding Corporation AKS and United States Steel Corp. X. While AK Steel holds a Zacks rank #1 (Strong Buy), United States Steel retains a Zacks Rank #2 (Buy).