SOUTH AFRICA – Steel maker ArcelorMittal SA’s full-year results reflect the dramatic deepening in the commodities downturn, with the steel industry taking a hit from China’s economic slowdown.
For the year to end-December, the headline loss per share widened to R13.38 from 57c in the previous year, ArcelorMittal SA reported on Friday.
The steel maker said revenue declined to R31bn in the period under review, from R34.9bn a year earlier.
The company said the local steel industry “is under severe threat”.
“It is clear that the steel industry has reached the end of a major growth cycle on the back of rapid economic development in China, which was followed by China’s slowdown,” ArcelorMittal SA said.
“The low level of investment, financial market turbulence and geopolitical conflicts in many developing regions further exacerbate the situation.”
Total sales volumes fell 3% year on year. The company’s net borrowing position was R2.9bn at the end of the year, compared with net borrowings of R546m at the end of the previous year, reflecting the extremely difficult trading conditions.
Since the release of its last full-year results, ArcelorMittal SA’s share price has plummeted 76%.
Its shares closed at R6.20 on the JSE on Thursday.
The share price peaked at R265 in 2008, during the commodities boom.