The world’s largest steel producer lost $7.9 billion

Arcelor – whose boss Lakshmi Mittal was once the sixth richest man on the planet – posted a loss of $7.9bn (£5.4bn) in 2015 as the price of iron ore, a key component in steel production, continued to contract. The company is also trying to raise $3 billion (£2.06 billion) to pay down debt. The price of iron ore fell by almost 40% in 2015.

A summary of the ArcelorMittal situation:

The loss included $4.8bn (£3.3bn) of write-downs. And $1.4 billion (£960 million) in exceptional company fees;

The amount recorded as a loss in 2015 was four times higher than the one the company recorded in 2014 (1.8 billion);

Liabilities total $15.7 billion (£10.8 billion), down $1.1 billion (£760 million)

 ArcelorMittal will issue new shares worth $3 billion, in an attempt to reduce debts even more;

Earnings fell by 18.4% in the last quarter of 2015, to $1.1 billion;

Steel exports decreased by 0.6% in 2015.

Speaking about the results, Mittal said:

„2015 was a very difficult year for the steel and mining industry. Although demand in our core markets remained strong, prices deteriorated significantly during the year due to excess capacity in China.”

„Unfortunately, we announced a disappointing net steel production loss, which includes non-cash impairment charges on our mining assets, as a result of the significant drop in ore prices. Our operating business is fully focused on adapting to this low price environment.”

Article source: http://uk.businessinsider.com/arcellormittal-bg-group-losses-2015-oil-steel-2015-2016-2