ArcelorMittal, the world's largest steel maker, on Friday reported a net loss of $345 million for the first quarter ended March, but said its restructuring efforts have begun to yield results.
The company had reported a net profit of $92 million in the corresponding quarter of 2012 as it had benefited from a tax windfall of $176 million.
Besides, its core profits or EBITDA (earnings before interest, taxes, depreciation and amortisation) also declined by 26.11% to $1.565 billion during the quarter, while the sales was down 13% at $19.752 billion.
"Economic conditions remain challenging but our performance in the quarter reflects the results of the management action we have taken to confront the effects of the financial crisis.
"We have significantly reduced our net debt and the steps we have taken to focus production on our more competitive assets are beginning to yield results," ArcelorMittal CEO Lakshmi Mittal said.
According to the company, it managed to reduce its net debt by $3.8 billion to $18 billion as on March 31.
During the quarter, its steel shipments at 20.9 million tonnes (MT) increased 4.7% during the quarter as compared to October-December quarter of 2012. However, it declined by 5.86% on a year-on-year basis.
Besides, its crude steel production declined 1.75% to 22.4 MT, while iron ore production was down 0.76% to 13.1 MT during the quarter.
"EBITDA in second quarter of 2013 is expected to be above first quarter levels. Together with an anticipated release of working capital and receipt of previously announced disposal proceeds, this should support a further reduction in net debt to approximately $17 billion by end June 2013," the company said in its outlook.
Moreover, it reiterated its guidance of achieving an EBITDA of $7.1 billion in the year, while assuming that iron ore prices and margin of steel prices over raw material costs would remain similar to the levels of 2012.
It is also hopeful of a 2% increase in steel shipments and a 20% rise in iron ore shipments.
The company has kept a capital expenditure target of $3.5 billion and is targeting to increase production of iron ore from its Canadian mines to 24 MT from existing 16 MT by June this year.
It also hopes to gain USD 3 billion by 2015-end through cost cutting measures and realised $0.2 billion in the first quarter ended March, 2013.