Luxembourg, February 9, 2023 - ArcelorMittal (referred to as “ArcelorMittal” or the “Company”) (MT (New York, Amsterdam, Paris, Luxembourg), MTS (Madrid)), the world’s leading integrated steel and mining company, today announced results1,2 for the three-month and twelve-month periods ended December 31, 2022.
Analyst & investor call registration - link
Earnings Release - EN - PDF
Analysts slides – EN – PDF
Analyst model - XLS
2022 Key Highlights:
Health and safety focus: Protecting the health and wellbeing of the employees remains the Company’s overarching priority; LTIF rate of 0.70x in FY 2022 vs. 0.79x in FY 20213
Strong full year financial performance: FY 2022 operating income of $10.3bn4,5 (vs. $17.0bn4,5 in FY 2021); FY 2022 EBITDA of $14.2bn (vs. $19.4bn in FY 2021)
Healthy net income: FY 2022 adjusted net income6 of $10.6bn (vs. $14.9bn in FY 2021); FY 2022 net income includes share of JV and associates net income of $1.3bn (vs. $2.2bn in FY 2021).
Strong FCF generation: The Group generated $6.4bn free cash flow (FCF) in FY 2022 ($10.2bn net cash provided by operating activities less $3.5bn capex and $0.3bn minority dividends), broadly stable as compared to FY 202117. 4Q 2022 FCF of $2.1bn ($3.6bn net cash provided by operating activities less $1.5bn capex)
Financial strength: The Company ended 2022 with record low net debt of $2.2bn (vs. $4.0bn at the end of 2021). Gross debt of $11.7bn at the end of 2022, and cash and cash equivalents of $9.4bn.
Share repurchases driving enhanced value: Share buybacks reduced the fully diluted shares outstanding by 11% in 2022, bringing the total reduction to 30% since end of September 20207. FY 2022 basic EPS of $10.21/sh vs. $13.53/sh for FY 2021. FY 2022 adjusted basic EPS6 of $11.65; last 12 months ROE8 of 20.3% and book value per share9 increased to $62/sh
Priorities & Outlook:
Global leadership on addressing climate change: During 2022, the Company progressed its plans to reduce the CO2e intensity of its global production by 25% by 2030
Texas HBI plant acquired, securing high-quality metallics for low-carbon steelmaking
$0.6bn investment in 1GW renewable energy project in India underway
1st smart carbon CCU project inaugurated in Ghent (Belgium)
4 specialist scrap metal recyclers acquired in Europe
1st low-carbon emissions steelmaking project in Dofasco (Canada)
The Company is progressing on key European decarbonization projects
Delivering strategic growth in support of higher sustainable returns
Texas HBI acquisition and Brazil CSP acquisition (to be completed in 1Q 2023) estimated to add ~$0.5bn to normalized EBITDA16
Expansion of the AMNS India Hazira plant to ~15Mt capacity by 2026 now underway
Ramp up of the 2.5Mt Mexico hot strip mill is ongoing with $0.1bn EBITDA run-rate achieved in 4Q 2022
Strategic capex envelope of high return projects is now $4.2bn19 to be spent between 2021-2024 (of which $0.9bn has been spent to date) and estimated to add ~$1.3bn to normalized EBITDA16; FY 2023 capex expected to be between $4.5bn-$5.0bn
Building a track record of consistently returning capital to shareholders:
Share buy backs completed in 2022 represented 11% of diluted equity, bringing total purchases since September 2020 to 30% at an average share price of €24.34
There remains (~$0.1bn) of post-dividend FCF to be returned to shareholders as per the capital return policy, and this is expected to be completed in 1Q 2023. The remaining amounts under the existing buy back program will be allocated to the 2023 capital return (targeting 50% of post-dividend FCF as per the policy).To provide sufficient headroom for the 2023 capital return, the Company intends to seek additional authority from shareholders to repurchase shares at the 2023 AGM in May
The Board proposes to increase the annual base dividend to shareholders to $0.44/sh (to be paid in 2 equal instalments in June 2023 and December 2023), subject to the approval of shareholders at the 2023 AGM
Outlook
World ex-China apparent steel consumption ("ASC") in 2023 is expected to recover by +2% to +3% as compared to 2022; the Company expects its steel shipments in 2023 to grow by ~5% vs. 202211
The Company expects positive FCF generation in 2023; capex is expected to increase to within the $4.5bn-$5.0bn range, interest costs are expected to increase to approximately $0.4bn, and lower cash taxes (including non-recurrence of timing related payments made in 2022 of $0.7bn)
The Company expects working capital will follow the normal seasonal patterns (including an investment in 1Q 2023) but expects a release for the full year 2023