ArcelorMittal focus on cutting debt, loss-making ops

ArcelorMittal, the world's biggest steelmaker, said Wednesday it would focus on improving its competitive position and cutting debt as it announced a 37 percent drop in second quarter net profit. "Market conditions in the first half have been very challenging, indeed more challenging than we had expected due to a combination of factors, not least the still unresolved crisis in the eurozone," chairman and chief executive Lakshmi Mittal said in a statement. "Europe remains our biggest concern and the severity of the situation is reflected in the performance of our European operations," Mittal said. "Our focus throughout the remainder of the year remains on further improving competitiveness and reducing debt." Finance director Aditya Mittal told a conference call the company would shut down or close less profitable steel mills, with the goal of saving one billion euros ($1.21 billion) per year. In Europe, 16 plants of a total 25 were still in operation, but sites in Belgium, France, Luxembourg and Spain were either slated to be suspended or had already been shut down, he said. The group posted a second-quarter net profit of $959 million, a drop of 37 percent from the same period a year earlier, on sales that fell to $22.5 billion from $25.1 billion. The net profit was nonetheless better than ArcelorMittal's first quarter figure of just 11 million dollars, and Aditya Mittal said it was possible the group would benefit from a "technical rebound" in the fourth quarter in Europe. Meanwhile, it planned to sell non-strategic assets such as a 48.1 percent holding in the engineering group Paul Wurth for 300 million euros, following a sale of activities in North America for $605 million. Group debt at end-June stood at $22 billion, a year-on-year drop of $1.6 billion, Lakshmi Mittal noted. Shares in the group showed a solid gain of 2.81 percent in afternoon trade on the Paris stock exchange, while the CAC index of blue-chip stocks was up 0.86 percent overall.