ArcelorMittal
MT 20-F Report ended Dec. 31, 2024
Ernst & Young S.A. acted as the principal independent registered public accounting firm for ArcelorMittal for the fiscal years ended
December 31, 2024 and for the fiscal year ended December 31, 2023. Set forth below is a breakdown of fees for services rendered by
the auditor in 2024 and 2023.
Audit Fees.
Audit fees for the audits of financial statements in 2024 and 2023 were
26.0
and
24.2
,
respectively, and for regulatory filings
0.1
and
0.1
i
n 2024 and 2023, respectively.
Audit-Related Fees.
Audit-related fees in 2024 and 2023 were
0.7
and
2.5
,
respectively. Audit-related fees include fees for agreed upon
procedures for various transactions or reports.
Tax Fees.
Fees relating to tax planning, advice and compliance in 2024 and 2023 were
0.6
and
1.2
, respectively.
All Other Fees.
Fees in 2024 and 2023 for all other services were
0.1
and
0.1
, respectively. All other fees relate to services not included
in the first three categories.
UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
20-F
OR
For the fiscal year ended
December 31
, 2024
OR
OR
Commission file number
001-35788
(Exact name of Registrant as specified in its charter)
N/A
(Translation of Registrant’s name into English)
(Jurisdiction of incorporation or organization)
(Address of principal executive offices)
(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)
Securities registered or to be registered pursuant to Section 12(b) of the Act:
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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Securities registered or to be registered pursuant to Section 12(g) of the Act:
None
Securities for which there is reporting obligation pursuant to Section 15(d) of the Act:
None
Indicate the number of outstanding shares of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report:
Ordinary Shares
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934.
Yes ☐
No
☒
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S‐T
(§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or an emerging growth company. See definition of
“large accelerated filer," "accelerated filer," and "emerging growth company” in Rule 12b-2 of the Exchange Act.
If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the
extended transition period for complying with any new or revised financial accounting standards
†
provided pursuant to Section 13(a) of the Exchange
Act. ☐
†
The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after
April 5, 2012.
Indicate
by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over
financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.
☒
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect
the correction of an error to previously issued financial statements.
☐
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of
the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b).
☐
Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:
U.S. GAAP ☐
International Financial Reporting Standards
as issued by the International Accounting Standards
Board
☒ Other ☐
If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow.
Item 17 ☐ Item 18 ☐
If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes ☐ No
☒
Table of contents
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Management report
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Page
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Introduction
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Company overview
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History and development of the Company
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Cautionary Statement regarding forward-looking
statements
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Key transactions and events in 2024
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Sustainable development highlights
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Risk Factors and Control
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Business overview
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Business strategy
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Research and development
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Sustainable development
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Products and markets
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Raw materials and energy
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Sales and marketing
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Intellectual property
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Government regulations
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Organizational structure
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Properties and capital expenditures
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Property, plant and equipment
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Capital expenditures
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Mineral reserves and resources
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Operating and financial review
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Key factors affecting results of operations
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Operating results
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Liquidity and capital resources
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Disclosures about market risk
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Outlook
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Management and employees
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Directors and senior management
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Compensation
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Employees
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Corporate governance
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Insider Dealing Regulation
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Shareholders and markets
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Major shareholders
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Related party transactions
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Markets
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New York Registry Shares
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Dividend distributions
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Purchases of equity securities by the issuer and
affiliated purchasers
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Share capital
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Additional information
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Page
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Memorandum and Articles of Association
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Material contracts
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Exchange controls and other limitations affecting
security holders
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Taxation
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Evaluation of disclosure controls and procedures
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Management’s report on internal control over
financial reporting
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Principal accountant fees and services
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Glossary - definitions, terminology and principal
subsidiaries
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Exhibits
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Signature
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Reports of Independent Registered Public
Accounting Firms
(
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Consolidated financial statements
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Consolidated statements of operations
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Consolidated statements of other comprehensive
income
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Consolidated statements of financial position
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Consolidated statements of changes in equity
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Consolidated statements of cash flows
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Notes to the consolidated financial statements
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Form 20-F Cross Reference Guide
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Item
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Form 20-F Caption
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Reference in current report
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Page
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Glossary - definitions, terminology and principal
subsidiaries
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Cautionary statement regarding forward-looking s
tatements
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Cautionary statement regarding forward-looking
statements
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Part
I
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Item
1.
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Identity of Directors, Senior Management and
Advisers
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Not applicable
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Item
2.
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O
ffers
Statistics and Expected
Timetable
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Not applicable
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Item
3.
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K
ey
Information
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A.
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[Reserved]
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Not applicable
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B.
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Capitalization and indebtedness
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Not applicable
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C.
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Reasons for the offer and use of proceeds
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Not applicable
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Risk Factors and Control
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Item
4.
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Information on the Co
mpany
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History and development of the Company, Key
transactions and events in 2024, Recent developments,
Sustainable development highlights - striving to be a
leader in the decarbonization of the steel industry, Capital
expenditures, Raw materials, Sources and uses of cash,
Note 2 to consolidated financial statements
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Competitive strengths, Market information, Key
transactions and events in 2024, Risk management
process, Business overview - Business strategy,
Sustainable development, Purchasing, Products, Sales
and marketing, Intellectual property, Government
regulations, Raw materials
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Organizational structure
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Property, plant and equipment, Capital expenditures,
Reserves and Resources (iron ore and coal)
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Item
4A.
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Unresolved staff c
omments
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None
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Item
5.
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Operating and Financial Review and
Prospects
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Key factors affecting results of operations, Operating
results
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Liquidity and capital resources
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C.
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Research and development, patents and licenses
, etc.
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Competitive strengths, Research and development
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Outlook and Key factors affecting results of operations
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E.
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Critical Accounting Estimates
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Critical accounting policies and use of judgments and
estimates
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Item
6.
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Directors, Senior Management and
Employees
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Directors and senior management
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Compensation
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Corporate governance, Directors and senior management
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Employees
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Management share ownership, Compensation
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F.
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Disclosure of a registrant’s action to recover erroneously awarded
compensation.
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Not applicable
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Item
7.
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Major Shareholders and Related Party
Transactions
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Major shareholders
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Related party transactions
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C.
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Interest of experts and counsel
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Not applicable
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Item
8.
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Financial
Information
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A.
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Consolidated statements and other financial information
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Consolidated financial statements as of and for the year
ended December 31, 2024, Export sales, Legal
proceedings, Additional information - Capital return policy
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B.
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Significant changes
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Recent developments, Operating and financial review,
Note 13 to consolidated financial statements
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Item
9.
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T
he
Offer and
Listing
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A.
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Offer and listing details
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Markets
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B.
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Plan of distribution
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Not applicable
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C.
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Markets
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Markets
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D.
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Selling shareholders
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Not applicable
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E.
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Dilution
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Not applicable
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F.
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Expenses of the issue
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Not applicable
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Item
10.
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Additional
Information
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Share capital
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Memorandum and Articles of Association
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Material contracts
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Exchange controls and other limitations
affecting security holders
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Taxation
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F.
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Dividends and paying agents
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Paying agents and Earnings distribution
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G.
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Statements by experts
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Reserves and Resources (iron ore and coal) and Exhibits
15.1, 15.2, 15.3, 15.4, 15.5, 15.6, 15.7, 15.8, 15.9, 15.10
and 15.11
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H.
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Documents on display
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History and development of the Company
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I.
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Subsidiary information
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Not applicable
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J.
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Annual Report to Security Holders
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Not applicable
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Item
11.
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Disclosures about market risk
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Item
12.
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Description of Securities Other Than Equity
Securities
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A.
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Debt Securities
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Not applicable
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B.
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Warrants and Rights
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Not applicable
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C.
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Other Securities
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Not applicable
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New York Registry Shares
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Part
II
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Item
13.
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Defaults, Dividend Arrearages and Delinquenc
ies
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None
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Item
14.
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M
aterial
Modifications to the Rights of Security Holders and Use of
Proceeds
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None
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Item
15.
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Controls and
Procedures
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Evaluation of disclosure controls and
procedures, Management’s report on internal control
over financial reporting and Internal control procedures,
Report of Independent Registered Public Accounting Firm
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Item
16A.
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Audit committee financial
expert
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Corporate governance
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Item
16B.
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Code of
Ethics
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Corporate governance — Code of Business Conduct
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Item
16C.
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Principal accountant fees and services
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Item
16D.
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Exemptions from the Listing Standards for Audit
Committees
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None
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Item
16E.
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Purchases of equity securities by the issuer and affiliated
purchasers
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Item
16F.
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Change in Registrant’s Certifying
Accountant
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Not applicable
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Item
16G.
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Corporate
Governance
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Corporate governance
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Item 16H.
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Mine Safety Disclosure
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Not applicable
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Item 16I.
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Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
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Not applicable
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Item
16J.
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Insider Trading Policies
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Corporate governance —Insider Dealing Regulations,
Exhibit 11.1
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Item 16K
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Cybersecurity
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Risk Factors and Control — Cybersecurity
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Part
III
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Item
17.
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Financial statements
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Consolidated financial statements
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Item
18.
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Financial statements
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Consolidated financial statements
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Item
19.
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Exhibits
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Exhibits
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3
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Management report
|
INTRODUCTION
Company overview
ArcelorMittal is one of the world’s leading integrated steel and
mining companies. ArcelorMittal is the largest steel producer in
Europe and among the largest in the Americas, and a growing
presence in Asia including India through its joint venture AMNS
India.
*Iron ore production includes production from ArcelorMittal Mining Canada G.P.
and ArcelorMittal Infrastructure G.P. ("AMMC"), ArcelorMittal Liberia and captive
mines.
ArcelorMittal has steel-making operations in 15 countries,
including
36
integrated and mini-mill steel-making facilities
.
As of
December 31, 2024, ArcelorMittal had approximately
125,416
employees.
ArcelorMittal produces a broad range of high-quality finished
and semi-finished steel products ("semis"). Specifically,
ArcelorMittal produces flat products, including sheet and plate,
and long products, including bars, rods and structural shapes. It
also produces pipes and tubes for various applications.
ArcelorMittal sells its products primarily in local markets and to a
diverse range of customers in approximately
129
countries,
including the automotive, appliance, engineering, construction
and machinery industries. ArcelorMittal’s mining operations
produce various types of mining products including iron ore
lump, fines, concentrate, pellets and sinter feed.
As a global steel producer, the Company is able to meet the
needs of different markets. Steel consumption and product
requirements clearly differ between developed markets and
developing markets. Steel consumption in developed economies
is weighted towards flat products and a higher value-added mix,
while developing markets utilize a higher proportion of long
products and commodity grades. To meet these diverse needs,
the Company maintains a high degree of product diversification
and seeks opportunities to increase the proportion of higher
value-added products in its product mix.
History and development of the Company
ArcelorMittal results from the merger in 2007 of its predecessor
companies Mittal Steel Company N.V. and Arcelor, each of
which had grown through acquisitions over many years. Since
its creation ArcelorMittal has experienced periods of external
growth as well as consolidation and deleveraging (including
through divestment).
ArcelorMittal's success is built on its core values of safety,
sustainability, quality and leadership and the entrepreneurial
boldness that has empowered its emergence as the first truly
global steel and mining company. Acknowledging that a
combination of structural issues and macroeconomic conditions
will continue to challenge returns in its sector, the Company has
adapted its footprint to the new demand realities, redoubled its
efforts to control costs and repositioned its operations with a
view toward outperforming its competitors. ArcelorMittal’s
research and development capability is strong and includes
several major research centers as well as strong academic
partnerships with universities and other scientific bodies.
Against this backdrop, ArcelorMittal's strategy is to leverage four
distinctive attributes that will enable it to capture leading
positions in the most attractive areas of the steel industry’s
value chain, from mining at one end to distribution and first-
stage processing at the other: global scale and scope; superior
technical capabilities; a diverse portfolio of steel and related
businesses, one of which is mining; and financial capabilities.
The Company’s strategy is further detailed under “Business
overview—Business strategy”.
ArcelorMittal’s steel-making operations have a high degree of
geographic diversification. In 2024, approximate
ly
38%
of its crude steel was produced in the Americas, approximately
53%
was produced in Europe and approximately
9%
was
produced in other countries, such as South Africa and Ukraine
.
In addition, ArcelorMittal’s sales of steel products are spread
over both developed and developing markets, which have
different consumption characteristics.
ArcelorMittal’s mining
operations, including captive mines are present in North
America, South America, Africa and Europe.
Captive mines are
integrated into the Company's global steel-making facilities.
Competitive strengths
The Company believes that the following factors contribute to
ArcelorMittal’s success in the global steel and mining industry:
Market leader in steel.
ArcelorMittal had annual achievable
production capacity of approximately
76.7
millio
n tonnes
of
4
|
Management report
|
crude steel for the year ended December 31, 2024. Steel
shipments for the year ended December 31, 2024 totaled 54.3
million tonnes
. ArcelorMittal has significant operations in many
countries which are described in "Properties and capital
expenditures". In addition, many of ArcelorMittal’s
operating
units including through its joint ventures have access to
developing markets that are expected to experience, over time,
above-average growth in steel consumption (such as Central
and Eastern Europe, South America, India, Africa and Southeast
Asia).
The Company sells its products in local markets and through a
centralized marketing
organization
to customers in
approximately 129 countries.
ArcelorMittal’s diversified product
offering, together with its distribution network and research and
development (“R&D”) programs, enable it to build strong
relationships with customers, which include many of the world’s
major automobile and appliance manufacturers. The Company
is a strategic partner to many major original equipment
manufacturers (“OEMs”) and has the capability to build long-
term contractual relationships with them based on early vendor
involvement, contributions to global OEM platforms and
common value-creation program
s.
A world-class mining business.
ArcelorMittal has a global
portfolio of
9 operating units
with mines in operation and
development and is among the largest iron ore producers in the
world
. In
2024
, ArcelorMittal sourced a large portion of its raw
materials from its own mines and facilities including leases. The
table below reflects ArcelorMittal's self-sufficiency through its
mining operations in
2024
.
|
Millions of metric tonnes
|
Consumption
|
Sourced from
own mines/
facilities
2
|
Self-
sufficiency %
|
||||
|
Iron ore
|
71.1
|
40.9
|
58%
|
||||
|
PCI & coal
1
|
27.6
|
—
|
—%
|
||||
|
Coke
|
16.7
|
15.0
|
90%
|
||||
|
Scrap & DRI
|
25.3
|
13.6
|
54%
|
1.
Includes coal only for the steelmaking process and excludes steam coal for
power generation. ArcelorMittal's consumption of PCI and coal was 6.3 million
tonnes and 21.3 million tonnes, respectively, for the year ended December 31,
2024.
2.
Assumes 100% consumption of ArcelorMittal's iron ore and coal ship
ments.
The Company has iron ore mining activities in Brazil, Bosnia,
Canada, Liberia, Mexico, Ukraine, South Africa and through its
joint venture in India and associate in Canada (Baffinland).
ArcelorMittal’s main mining products include iron ore lump,
fines, concentrate, pellets and sinter feed. In addition,
ArcelorMittal produces substantial amounts of DRI, an important
metallic feedstock required for the production of highest quality
steels through the EAF route, which will grow substantially in the
context of decarbonization. As of December 31, 2024,
ArcelorMittal’s iron ore reserves (including reserves at mines
where ArcelorMittal owns less than 100%, based on
ArcelorMittal's ownership percentage even if ArcelorMittal is
entitled to mine all the reserves, and including reserves for
which use is restricted) were estimated at
3,831
million tonnes
run of mine. See “Properties and capital expenditures—Mineral
reserves and resources” for a detailed list of the entities with
mineral reserves and resources and ownership structure. The
Company’s long-life iron ore reserves and resources provide a
measure of security of supply and an important natural hedge
against raw material volatility and global supply constraints. The
seaborne iron ore mining business is managed as a separate
segment which enhances ArcelorMittal’s ability to optimize
capital allocation.
ArcelorMittal’s facilities have good access to shipping facilities,
including through ArcelorMittal’s own, or partially owned,
18
deep-water port facilities and linked railway sidings.
Market-leading automotive steel business
. ArcelorMittal has
a leading market share
(approximately
16%
of the worldwide
market)
in automotive, and is a leader in the fast-growing
advanced high-strength steels ("AHSS") segment, specifically
for flat products. ArcelorMittal is the first steel company in the
world to embed its own engineers within an automotive
customer to provide engineering support. The Company begins
working with OEMs as early as five years before a vehicle
reaches the showroom, to provide generic steel solutions, co-
engineering and help with the industrialization of the project.
These relationships are founded on the Company’s continuing
investment in R&D and its ability to provide well-engineered
solutions that help make vehicles lighter, safer and more fuel-
efficient.
In 2024, ArcelorMittal continued to extend the S-in Motion®
catalog according to the automotive market trends. The S-in
Motion® battery electric vehicles ("BEV") catalog of steel
solutions has been adapted to include specific products for
BEV's including new designs focused on battery protection.
Advanced and especially ultra-high strength steels, innovative
press hardened steels, and laser welded blanks are especially
highlighted as key solutions for optimal performance (passenger
safety/lightweighting) and battery protection. The growth of
various types of electric vehicles will impact design and
manufacturing leading to demand for different materials and
steel grades, and more AHSS for battery protection. For
instance, both the battery box and body structure have to
protect the battery in the event of a crash.
In the automotive industry, ArcelorMittal mainly supplies the
geographic markets where its production facilities are located,
which are Europe, North and South America, South Africa, India
through its joint venture AMNS India, and China through Valin
ArcelorMittal Automotive Steel Co., Ltd (“VAMA”), a joint venture
with Hunan Valin. VAMA’s product mix is oriented toward higher
value products and mainly toward the OEMs to which the
5
|
Management report
|
Company sells tailored solutions based on its products. With
sales and service offices worldwide and production facilities in
North and South America, South Africa, Europe, India and
China, ArcelorMittal believes that it is uniquely positioned to
supply global automotive customers with the same products
worldwide. The Company has multiple joint ventures and has
also developed a global downstream network of partners
through its distribution solutions activities. This provides the
Company with a proximity advantage in virtually all regions
where its global customers are present.
Sustainability (with focus on CO
2
emission reduction in the
supply chain) has become a key requirement in the automotive
industry linked to the importance of sustainability
in the holistic
electrical vehicle market.
In 2021, ArcelorMittal launched two
solutions under the XCarb®
brand: XCarb® green steel
certificates and XCarb® recycled and
renewably
produced
("RRP"), which was well received in automotive industry and
markets. The first XCarb® RRP steels were successfully
launched in Europe and in North America, exhibiting potential for
reduction in CO
2
emissions. ArcelorMittal also combines
manufacturing simplification and sustainability with the
development in Europe of the XCarb® Door Ring.
For further details on the new products under development, see
"Business overview—Research and development”.
Diversified and efficient producer.
As a global steel
manufacturer with a leading position in many markets,
ArcelorMittal benefits from scale and production cost efficiencies
in various markets and a measure of protection against the
cyclicality of the steel industry and raw materials prices.
•
Diversified production process
. In 2024, approximately
43.5 million tonnes of crude steel were produced
through the basic oxygen furnace process ("BOF") and
approximately 14.4 million tonnes through the electric
arc furnace ("EAF") process. This provides
ArcelorMittal with greater flexibility in its raw material
and energy use, and increased ability to meet varying
customer requirements in the markets it serves.
•
Product and geographic diversification
. By operating a
portfolio of assets diversified across product segments
and geographic areas, ArcelorMittal benefits from a
number of natural hedges. As a global steel producer
with a broad range of high-quality finished and semi-
finished steel products, ArcelorMittal is able to meet the
needs of diverse markets. Steel consumption and
product requirements vary between mature economy
markets and developing economy markets. Steel
consumption in mature economies is largely from flat
products and a higher value-added mix, while
developing markets utilize a higher proportion of long
products and commodity grades. As developing
economies mature and markets evolve, local
customers will require increasingly advanced steel
products. To meet these diverse needs, ArcelorMittal
maintains a high degree of product diversification and
seeks opportunities to increase the proportion of its
product mix consisting of higher value-added products.
•
Upstream integration
. ArcelorMittal believes that its
own raw material production provides it with a
competitive advantage over time. Additionally,
ArcelorMittal benefits from the ability to optimize its
steel-making facilities’ efficient use of raw materials, its
global procurement strategy and the implementation of
Company-wide knowledge management practices with
respect to raw materials. Certain of the Company’s
operating units also have access to infrastructure, such
as deep-water port facilities, railway sidings and
engineering workshops that lower transportation and
logistics costs.
•
Downstream integration
. ArcelorMittal’s downstream
integration, primarily through its Europe segment for
distribution solutions, enables it to provide customized
steel solutions to its customers more effectively. The
Company’s downstream assets have cut-to-length,
slitting and other processing facilities, which provide
value additions and help it to maximize operational
efficiencies.
Dynamic responses to market challenges and
opportunities.
ArcelorMittal’s management team has a strong
track record and extensive experience in the steel and mining
industries.
In February 2022, the Company announced a new three-year
$1.5 billion value plan ($1.4 billion scope adjusted for the sale of
ArcelorMittal Temirtau operations on December 7, 2023)
focused on creating value through well-defined commercial and
operational initiatives. This plan did not include the impact of
strategic capital expenditure projects (which are followed
separately). The plan includes commercial initiatives, including
volume/mix improvements and operational improvements
(primarily in variable costs). The plan aims at protecting
operating income potential of the business from rising
inflationary pressures, improving its relative competitive position
vis-à-vis its peers and supporting sustainably higher profits. The
plan was completed in 2024, and the actions taken in the three
years from 2022 to 2024 have yielded cumulative benefits of
$1.4 billion (approximately 100% of the scope adjusted target).
These include $0.4 billion of commercial initiatives, $0.7 billion
of variable costs savings and $0.2 billion of logistic and other
improvements.
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Management report
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Proven expertise in acquisitions
A
rcelorMittal’s management team has proven expertise in
successfully acquiring and subsequently integrating operations.
The Company takes a disciplined approach to investing and
uses teams with diverse areas of expertise from different
business units across the Company to evaluate opportunities,
conduct due diligence and monitor integration and post-
acquisition performance. The Company introduces focused
capital expenditure programs, implements Company-wide best
practices, balances working capital, ensures adequate
management resources and introduces safety and
environmental improvements at acquired facilities. ArcelorMittal
believes that these operating and financial measures have
improved the operating performance and the quality of steel
produced at such facilities.
In recent years, the Company has focused on
portfolio
optimization including assets disposals and strategic M&A
activity (see also "— Key transactions and events in 2024"). In
2022, ArcelorMittal acquired a 80% interest in voestalpine's
world-class Hot Briquetted Iron ("HBI") plant in Texas and in
2023, the Company completed the acquisition of Companhia
Siderúrgica do Pecém ("CSP") renamed ArcelorMittal Pecém in
Brazil, a world-class operation, producing
high-quality slab at a
globally competitive cost. To further support its decarbonization
strategy, ArcelorMittal acquired several steel recycling
businesses (ALBA and John Lawrie Metals in 2022, Riwald
Recycling in 2023). It also complemented the Company's
existing geographic presence and strengthened the product
portfolio of the Sustainable Solutions segment's construction
business through the acquisitions of Italpannelli Germany, Spain
and Italy in 2023 and 2024. In August 2024, ArcelorMittal
acquired a 28% stake in Vallourec, which presents a compelling
opportunity to increase the Company’s exposure to the
attractive, downstream, value-added tubular market.
Sustainability leadership
ArcelorMittal is committed to the industry’s efforts to
decarbonize, and to being part of the solution to the world
reaching net-zero by 2050. As innovation is central to the
Company's success given the onus it places on research and
development ("R&D") with the goal of ensuring ArcelorMittal is at
the forefront of the evolution of steelmaking processes and
products, the Company has developed the industry’s broadest
and most flexible suite of low-emissions steelmaking
technologies and has integrated them into two pathways, Smart
Carbon and Innovative-DRI, both of which hold the potential to
deliver carbon-neutral steelmaking.
Other information
ArcelorMittal is a
public limited liability company
(société
anonyme) that was incorporated for an unlimited period under
the laws of the
Grand Duchy of Luxembourg
on June 8, 2001.
ArcelorMittal is registered at the R.C.S. Luxembourg under
number B 82.454.
The mailing address and telephone number of ArcelorMittal’s
registered office are:
|
ArcelorMittal
|
|
24-26, Boulevard d’Avranches
|
|
L-1160 Luxembourg
|
|
Grand Duchy of Luxembourg
|
|
Telephone: +352 4792-1
|
ArcelorMittal’s agent for U.S. federal securities law purposes is:
|
ArcelorMittal Sales & Administration LLC
|
|
833 W. Lincoln Highway, Suite 200E,
|
|
Schererville, IN 46375
|
|
Telephone: +219 256 7303
|
Internet site
ArcelorMittal maintains an Internet site at
www.arcelormittal.com. Information contained on or otherwise
accessible through this Internet site is not a part of this annual
report. All references in this annual report to this Internet site
and to any other Internet sites (other than to specific documents
furnished to or filed with the SEC and specifically incorporated
by reference herein) are inactive textual references and are for
information only.
The SEC maintains an internet site that
contains reports, proxy and information statements, and other
information regarding issuers that file electronically with the SEC
at www.sec.gov.
ArcelorMittal produces a range of publications to inform its
shareholders. These documents are available in various
formats: they can be viewed online or downloaded. Please refer
to www.arcelormittal.com, where they can be located within the
Investors menu, under Financial Reports, or within the
Corporate Library. Any request for documents may be sent to:
company.secretary@arcelormittal.com or ArcelorMittal’s
registered office.
Sustainable development
ArcelorMittal's sustainable development information is detailed
in i
ts Sustainability Report which is expected to be published
during the second quarter of 2025
. It will be available within the
Corporate Library on www.arcelormittal.com. For further
information, please refer to the section "Sustainable
Development".
ArcelorMittal
as parent company of the ArcelorMittal group
ArcelorMittal, incorporated under the laws of Luxembourg, is the
parent company of the ArcelorMittal group and is expected to
continue this role during the coming years. The Company has
no branch offices.
7
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Management report
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Listings
ArcelorMittal’s shares (also referred to as "ordinary shares" or
"common shares" throughout this report) are traded on several
exchanges: New York (MT), Amsterdam (MT), Paris (MT),
Luxembourg (MT) and on the Spanish Stock Exchanges of
Barcelona, Bilbao, Madrid and Valencia (MTS). Its primary stock
exchange regulator is the Luxembourg CSSF ("Commission de
Surveillance du Secteur Financier"). ArcelorMittal’s CSSF issuer
number is E-0001.
Indexes
ArcelorMittal is a member of more than 145 indices including:
STOXX Europe 600, S&P Europe 350, CAC40, Bloomberg
Europe 500 Steel Index, and Euronext Amsterdam AEX Basic
Materials Index. Recognized for its commitments to sustainable
development, ArcelorMittal is also included in the FTSE4Good
Index, Euronext Vigeo Europe 120 and the Euronext Most
Advanced Benelux 20.
Share price performance
During 2024, the price of ArcelorMittal shares decreased by
17.9
% in dollar terms compared to 2023 year on year;
the c
hart
below shows a comparison between the performance of
ArcelorMittal’s shares and the Eurostoxx600 Basic Resource
(SXPP).
Capital return policy
On
April 30, 2024
, at the annual general meeting of
shareholders ("AGM"), the shareholders approved the dividend
of $0.50 per share proposed by the Board of Directors. The
dividend amounted to $
393
million and payment included two
installments; the first installment of $200 million was paid on
June 12, 2024 and the second installment of $193 million was
paid on December 4, 2024.
In accordance with its capital return policy, the Company
expects to pay a base annual dividend
(to be progressively
increased over time)
. In addition, a minimum of 50% of the
amount of free cash flow (calculated as net cash provided by
operating activities less purchases of property, plant and
equipment and intangibles ("capital expenditures") less
dividends paid to non-controlling shareholders) remaining after
paying the base annual dividend is allocated to a share buyback
program.
On May 5, 2023, the Company announced a share buyback
program pursuant to the authorization of the AGM held on May
2, 2023, which remains outstanding
as of the date of this annual
report.
I
ncluding the $9.8 billion of shares repurchased under
previous and current share buyback programs from 2020 to
2023
and $1
.3 billion from shares repurchased during
2024
, the
Company returned in total $13.7 billion to shareholders
under
the above-mentioned capital return policy
. Also, see
"Operating
and financial review—Earnings distribution".
Additional
buybacks under the current share buyback program will be
allocated to the 2025 capital return. At December 31, 2024,
ArcelorMittal had repurchased 78 million shares representing
92% of the current share buyback program for a total value of
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Management report
|
$2.0 billion. For further information on buybacks, see
"Purchases of equity securities by the issuer and affiliated
purchasers".
In February 2025, the Board of Directors recommended an
increase of the base annual dividend to $0.55/share (from
$0.50/share paid in 2024) to be paid in two equal installments in
June 2025 and December 2025, subject to the approval of
shareholders at the annual general meeting of shareholders in
May 2025.
Investor relations
ArcelorMittal has a dedicated investor relations team at the
disposal of analysts and investors. By implementing high
standards of financial information disclosure and providing clear,
regular, transparent and even-handed information to all its
shareholders, ArcelorMittal aims to be the first choice for
investors in the sector.
To meet this objective and provide information to fit the needs of
all parties, ArcelorMittal implements an active and broad
investor communications policy: conference calls, road shows
with the financial community, regular participation at investor
conferences, plant visits and meetings with individual investors.
ArcelorMittal’s senior management plans to meet investors and
shareholder associations in such events throughout 2025.
Investors may use the following e-mails or contact numbers to
reach the investor relations team:
|
investor.relations@arcelormittal.com
|
'
+44 207 543 1128
|
|
creditfixedincome@arcelormittal.com
|
+33 1 7192 1026
|
Sustainable responsible investors
The Investor Relations team is also a source of information for
the growing sustainable responsible investment community. The
team organizes special events on ArcelorMittal’s corporate
responsibility strategy and answers all requests for information
sent to the Group at investor.relations@arcelormittal.com or
may be contacted at +44 7861 397 073.
Financial calendar
The schedule is available on ArcelorMittal’s website
www.arcelormittal.com under Investors, Financial calendar.
|
Financial results*:
|
|
|
Results for the first quarter of 2025
|
May 2, 2025
|
|
Results for the second quarter of 2025 and half year 2025
|
July 31, 2025
|
|
Results for the third quarter of 2025
|
November 6, 2025
|
|
Meeting of shareholders:
|
|
|
Annual general meeting of shareholders
|
May 6, 2025
|
* Earnings results are issued before the opening of the stock exchanges on which
ArcelorMittal is listed.
Cautionary Statement Regarding Forward-Looking Statements
This annual report contains forward-looking statements based
on estimates and assumptions. This annual report contains
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements include, among other things, statements concerning
the business, future financial condition, results of operations and
prospects of ArcelorMittal, including its subsidiaries. These
statements usually contain the words “believes”, “plans”,
“expects”, “anticipates”, “intends”, “estimates”, "targets" or other
similar expressions. For each of these statements, you should
be aware that forward-looking statements involve known and
unknown risks and uncertainties. Although it is believed that the
expectations reflected in these forward-looking statements are
reasonable, there is no assurance that the actual results or
developments anticipated will be realized or, even if realized,
that they will have the expected effects on the business,
financial condition, results of operations or prospects of
ArcelorMittal.
These forward-looking statements speak only as of the date on
which the statements were made, and no obligation has been
undertaken to publicly update or revise any forward-looking
statements made in this annual report or elsewhere as a result
of new information, future events or otherwise, except as
required by securities and other applicable laws and regulations.
A detailed discussion of principal risks and uncertainties which
may cause actual results and events to differ materially from
such forward-looking statements is included in the section titled
“Risk factors”.
All information that is not historical in nature and disclosed
under “Operating and financial review” is deemed to be a
forward-looking statement.
Market information
This annual report includes industry data and projections about
the Company’s markets obtained from industry surveys, market
research, publicly available information and industry
publications. Statements on ArcelorMittal’s competitive position
contained in this annual report are based primarily on public
sources including, but not limited to, published information from
the Company's competitors. Industry publications generally
state that the information they contain has been obtained from
sources believed to be reliable but that the accuracy and
completeness of such information is not guaranteed and that the
projections they contain are based on a number of significant
assumptions. The Company has not independently verified this
data or determined the reasonableness of such assumptions. In
addition, in many cases the Company has made statements in
this annual report regarding its industry and its position in the
industry based on internal surveys, industry forecasts and
market research, as well as the Company’s experience. While
9
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Management report
|
these statements are believed to be reliable, they have not been
independently verified.
Financial information
This annual report contains the audited consolidated financial
statements of ArcelorMittal and its consolidated subsidiaries,
including the consolidated statements of financial position as of
December 31, 2024 and 2023, and the consolidated statements
of operations, other comprehensive income, changes in equity
and cash flows for each of the years ended December 31, 2024,
2023 and 2022. ArcelorMittal’s consolidated financial statements
were prepared in accordance with International Financial
Reporting Standards (“IFRS”) as issued by the International
Accounting Standards Board (“IASB”)
.
The financial information and certain other information
presented in a number of tables in this annual report have been
rounded to the nearest whole number or the nearest decimal.
Therefore, the sum of the numbers in a column may not conform
exactly to the total figure given for that column. In addition,
certain percentages presented in the tables in this annual report
reflect calculations based upon the underlying information prior
to rounding and, accordingly, may not conform exactly to the
percentages that would be derived if the relevant calculations
were based on the rounded numbers. This annual report
includes
net debt, operating working capital, gearing and free
cash flow,
which are non-GAAP financial measures.
ArcelorMittal believes net debt, operating working capital,
gearing and free cash flow to be relevant to enhance the
understanding of its financial position and provides additional
information to investors and management with respect to the
Company’s operating cash flows, capital structure and credit
assessment. In addition, it refers to “special” items in its capital
return policy which will be used to determine if the base dividend
will be paid. “Special” items relate to events or charges that the
Company does not consider to be part of the normal income
generating potential of the business. Items may qualify as
“special” although they may have occurred in prior years or are
likely to recur in following years. Non-GAAP financial measures
should be read in conjunction with and not as an alternative for,
ArcelorMittal’s financial information prepared in accordance with
IFRS. Such non-GAAP measures may not be comparable to
similarly titled measures applied by other companies.
Key transactions and events in 2024
During 2024, ArcelorMittal completed several financing and
liability management transactions. Please refer to "Operating
and financial review
—Liquidity and capital resources—
Financings" of this report for a summary of these transactions.
•
On February 20, 2024, the Italian government placed
Acciaierie d’Italia SpA (“ADI”) into extraordinary
administration proceedings (“EA”) subsequent to the
request of Invitalia, thereby passing control of the company
from its then current indirect shareholders, ArcelorMittal and
Invitalia, and management to government-appointed
commissioners. Shortly thereafter, the court of Milan
ascertained ADI’s insolvency, thereby definitively confirming
the EA proceeding. As a result, ArcelorMittal has been
stripped of its rights as an indirect shareholder of ADI.
Similarly, ArcelorMittal has been stripped of its rights as a
direct shareholder in ADI’s parent company, Acciaierie
d’Italia Holding S.p.A. ("ADIH"), after the Italian government
placed it in EA. This ended ArcelorMittal’s involvement in
ADI, which dated back to 2018 (then ADI was known as
Ilva). During its involvement, ArcelorMittal had been fully
committed to the people and assets of ADI, investing over
€2 billion in the business since 2018. See “Risk Factors and
Control—ArcelorMittal is currently, and in the future may be,
subject to legal proceedings or other proceedings, including
in relation to its interest in ADI, the resolution of which
could negatively affect the Company’s profitability and cash
flows in a particular period.”
•
On March 19, 2024, ArcelorMittal announced that Kleber
Silva was nominated as
Executive
Vice President of
ArcelorMittal and appointed as Chief Executive Officer of
ArcelorMittal Mining, effective April
8
, 2024. See
"Management and employees
—Directors and senior
management—Senior management"
.
•
On May 31, 2024, ArcelorMittal completed the acquisition of
Italpannelli SRL in Italy and Italpannelli Iberica in Spain.
This marks the second acquisition of Italpannelli businesses
by ArcelorMittal, following the purchase of Italpannelli
Germany near Trier in March 2023. Italpannelli is a
manufacturer of lightweight insulation panels for roofs and
façades. It operates two production plants across Europe,
in Zaragoza (Spain) and Abruzzo (Italy). Combined the two
facilities operate seven production lines with a capacity of
13
million square meters of sandwich panels per year,
primarily serving customers in the central and eastern
European, Italian and Spanish markets and employ
approximately 260 people.
•
On November 28, 2023, ArcelorMittal South Africa
announced the contemplated wind down of its Newcastle
works and the broader long steel produc
ts business (“Longs
Business”), subject to the results of a due diligence and a
consultative process involving key customers, suppliers,
organized labor and other stakeholders, including the South
African government. On July 2, 2024, ArcelorMittal South
Africa announced that the Longs Business would continue
to operate to allow an opportunity for the short-, medium-
and longer-term initiatives (aimed at securing its
sustainability) to be fully explored. ArcelorMittal worked
extensively with the South African government and
stakeholders to explore alternatives for sustaining the
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Management report
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Longs Business. While not seeking subsidies, ArcelorMittal
South Africa requested policy support to address structural
constraints affecting the steel sector. Despite extensive
consultations with the South African government and
stakeholders to find viable solutions to sustain the Longs
Business, progress was insufficient and a decision was
made to wind down the Longs Business. Such decision
comes after sustained challenges, including weak economic
growth, high logistics and energy costs, and an influx of
low-cost steel imports, particularly from China, combined
with insufficient policy interventions (especially longstanding
policy decisions (namely, the Price Preference System
(PPS) and Export Scrap tax) relating to the substantial
subsidization of scrap-based steelmaking operations to the
detriment of the Newcastle Works – which benefits South
African-sourced raw materials). On January 6, 2025,
ArcelorMittal South Africa announced that it will
transition
the Longs Business into care and maintenance subject to a
consultation process.
The persistent overcapacity in the
global and local markets, and unsustainably low
international steel prices have further exacerbated the
business’ structural difficulties. Asset utilization in the Longs
Business reached only 50% as weak market conditions
necessitated the operation of its blast furnace at the lowest
level technically and responsibly possible.
It is expected
that approximately 3,500 direct and indirect jobs will be
affected
. Steel production was anticipated to cease by late
January 2025, with the wind-down of the remaining
production processes completed in the first quarter of 2025
but
the wind-down was postponed for
one
additional month
as discussions continued regarding potential governmental
support. On February 28, 2025, ArcerlorMittal South Africa
announced that it will implement the final wind down of the
Longs Business. It is envisaged that the shutdown of the
blast furnaces will commence in the first week of March,
with the last steel produced in late-March or early-April
2025. The final wind down into care and maintenance will
be fully implemented in the second quarter of 2025.
•
On August 6, 2024, ArcelorMittal completed the acquisition
of 65,243,206 shares, representing approximately 28.4%
non-controlling equity interest in Vallourec, for €14.64 per
share from Funds managed by Apollo Global Management,
Inc., for a total consideration of €
960
million ($1,048
million). Having carried out a successful restructuring in
recent years, the Company believes
Vallourec
presents a
compelling opportunity to increase ArcelorMittal’s exposure
to the attractive, downstream, value-added tubular market.
Vallourec is a global leader in premium tubular solutions for
energy markets and demanding industrial applications,
offering innovative, safe and competitive products for
various
sectors
including energy, automotive and
construction. Approximately
85
% of Vallourec’s 2.2 million
tonnes of annual rolling capacity is focused around low-
carbon, integrated productions hubs in the United States
and Brazil, both of which are important strategic markets for
ArcelorMittal
.
•
On October 11, 2024, ArcelorMittal announced it
had
entered into a definitive Equity Purchase Agreement (the
“Agreement”) with Nippon Steel Corporation (“NSC”)
pursuant to which ArcelorMittal will purchase NSC’s 50%
equity interest in the AMNS Calvert
joint venture
(the
“Transaction”). The Transaction was
entered into at the
request of NSC to address regulatory concerns pursuant to
its entry into an agreement to acquire
US Steel
. The
Transaction is subject to NSC completing its pending
acquisition of US Steel, which is subject to various other
regulatory requirements. Under the terms of the agreement,
ArcelorMittal will pay $1 consideration for the Transaction;
further, NSC will inject cash and forgive partner loans in an
amount estimated to be approximately $0.9 billion. On
January 3, 2025, the U.S. President issued an order
prohibiting NSC from acquiring US Steel
but the parties
were granted an extension to June 18, 2025 to permanently
abandon the transaction.
The agreement with NSC remains
in place until such date.
Recent developments
•
On March 3, 2025, ArcelorMittal announced the
appointment of Jorge Luiz Ribeiro de Oliveira, currently
Vice President of ArcelorMittal and CEO of ArcelorMittal
South America Flat Products, as Executive Vice President
and an Executive Officer of ArcelorMittal as well as
President of ArcelorMittal Brasil effective April 1, 2025, to
succeed Jefferson de Paula who is retiring, effective April 1,
2025. See "Management and employees
—Directors and
senior management—Senior management".
Sustainable development highlights
•
On February 27, 2024, ArcelorMittal announced that it had
signed
a memorandum of understanding
with Petrobras
to
assess potential business models for low-carbon fuels,
hydrogen and its products, renewable energy production
and carbon capture and storage ("CCS"). This follows a
joint study to develop a CCS hub in the state of Espirito
Santo.
•
On April 22, 2024, ArcelorMittal announced that
ArcelorMittal Calvert, wholly owned by ArcelorMittal, was
planning for an advanced manufacturing facility in Calvert,
Alabama that could deliver up to 150,000 tonnes of
domestic production capacity of non-grain-oriented
electrical steel ("NOES") annually, depending on the
product mix.
NOES plays a crucial role in the performance
and efficiency of electric motors used to power battery
electric vehicles, plug in hybrid electric vehicles and hybrid
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Management report
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vehicles as well as other specialized commercial, industrial,
and power generation applications. Given the nature of the
US auto market (larger vehicles, full-size pickups, SUVs)
there is rapidly growing demand for the most sophisticated
NOES for which there is limited US domestic supply
capabilities.
Plans at ArcelorMittal Calvert include an
annealing pickling line, cold-rolling mill, annealing coating
line, packaging and slitter line, and ancillary equipment
needed for operations. The planned i
nvestment is expected
to create up to 1,300 jobs during the construction phase
and more than 200 permanent positions to support the
plant’s ongoing operations. The NOES facility would be
sited near ArcelorMittal’s existi
ng joint venture with Nippon
Steel Corporation AMNS Calvert. On February 6, 2025,
ArcelorMittal confirmed that it will proceed with the
construction of the facility with estimated n
et capital
expenditure of $0.9
billion
(net of $0.3 billion
of
currently
planned federal, state and local support
)
. The plant is
anticipated to commence production in the second half of
2027.
•
On May 10, 2024, ArcelorMittal announced that it had
started the construction of an EAF for long products at its
Gijón plant, which is expected to produce its first heat in the
first quarter of 2026. This investment of €213 million will be
the first major EAF project to be implemented within the
Company’s decarbonization program in Europe and will
constitute the first step towards low-carbon emissions
steelmaking in Asturias. The new facility will have an annual
production capacity of 1.1 million tonnes of semi-finished
steel products, which will be supplied to the rail and wire-
rod mills at the plant. Initially, steel production through the
new EAF will lead to a reduction in CO
2
emissions of over
35%; the reduction in emissions could reach 1 million
tonnes of CO
2
equivalent a year once the transition phase
has been completed.
•
On May 21, 2024, ArcelorMittal announced that it had
successfully started operating a pilot carbon capture unit on
the blast furnace off-gas at ArcelorMittal Gent in Belgium
with partners Mitsubishi Heavy Industries, Ltd. (MHI), BHP,
along with Mitsubishi Development Pty Ltd (Mitsubishi
Development). The pilot carbon capture unit will operate for
one to two years at Gent, to test the feasibility of progress
to full-scale deployment of the technology, which would be
able to capture a sizeable portion of the Gent site
emissions, if successful.
•
On August 21, 2024, ArcelorMittal
Brasil
signed contracts
for the development of two solar energy projects with a
combined capacity of 465MW, equivalent to 14% of its
current electricity requirements.
The first project builds on
ArcelorMittal Brazil’s existing relationship with Casa dos
Ventos
(see "Properties and capital expenditures—
Investments in joint ventures—
Ventos de Santo Antonio
").
This latest agreement – again a joint venture in which
ArcelorMittal Brazil will hold a 55% stake with Casa dos
Ventos holding the balance – will see the construction of a
200MW capacity solar power plant on the same site as the
wind power project, in the state of Bahia, north-east Brazil,
with commissioning also expected before the end of 2025.
The second project is a partnership with Atlas Renewable
Energy, the second largest independent renewable energy
developer in Latin America, for the development of a
265MW capacity solar energy project in the state of Minas
Gerais, east Brazil. The agreement is for an initial 50/50
joint venture, with ArcelorMittal acquiring 100% of the solar
park upon build completion. Project commissioning is again
expected before the end of 2025. Both projects are subject
to approval from the Administrative Council for Economic
Defense (CADE), Brazil’s antitrust authority. The projects
support ArcelorMittal Brazil’s aims to secure and
decarbonize its future electricity needs and are a further
step towards its long-term ambition to be self-sufficient in
terms of its electricity requirements.
•
On October 9, 2024, ArcelorMittal published the
recommendations of the comprehensive dss+ workplace
safety audit that was commissioned at the end of 2023,
against the backdrop of a clear necessity to strengthen
Group safety performance. The audit, which was ongoing
for nine months across all geographies, functions and levels
of the organization, had three main
scopes:
(i) fatality
prevention standards for the three main occupational risks
leading to serious injuries and fatalities (work at heights,
vehicle driving and energy isolation); (ii) process safety
management focused on the highest risk assets; and (iii)
in-
depth
assessments of health and safety (H&S) systems,
processes and capabilities; governance and assurance
processes; and data management.
See
“Business overview
—Sustainability development—Health and Safety.".
•
On November 26, 2024, ArcelorMittal provided an update
on its decarbonization plans in Europe.
See “Business
overview—Sustainability development—Climate change
and decarbonization".
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Risk
Factors and
Control
Risk factors
ArcelorMittal’s business, financial condition, results of
operations, reputation or prospects could be materially and
adversely affected by one or more of the risks and uncertainties
described below.
I. Risks related to the global economy and the mining and steel
industry
Prolonged low steel and (to a lesser extent) iron ore prices,
low steel demand and/or steel/iron ore oversupply
would
have an adverse effect on ArcelorMittal’s results of
operations.
As an integrated producer of steel and iron ore, ArcelorMittal’s
results of operations are sensitive to the market prices of, and
demand for, steel and iron ore in its markets and globally. The
impact of market steel prices on its results is direct while the
impact of market iron ore prices is both direct and indirect, as
ArcelorMittal sells iron ore on the market to third parties (in
which case it benefits from higher iron ore market prices), and
indirect, as iron ore is a principal raw material used in steel
production and fluctuations in its market price are typically and
eventually (with the timing dependent on steel market
conditions) passed through to steel prices (with any lags in
passing on higher prices “squeezing” steel margins, as
discussed below). Steel and iron ore prices are affected by
supply and demand trends and inventory cycles. In terms of
demand, steel and iron ore prices are sensitive to trends in
cyclical industries, such as the automotive, construction,
appliance, machinery, equipment and transportation industries.
More generally, steel and iron ore prices are sensitive to
macroeconomic fluctuations in the global economy which are
impacted by many factors ranging from trade and geopolitical
tensions to global and regional monetary policy to specific
disruptive events such as pandemics, wars and natural
disasters.
Prior recessions have generally resulted in lower steel
demand and steel prices, with consequential material adverse
impacts on steel companies’ results. Significant declines in steel
prices have resulted, and may in the future result, in inventory-
related charges. In addition, the impact of lower steel prices on
ArcelorMittal’s results is subject to a lag effect (due to its
contracts), and therefore the impact is felt beyond the duration
of any decline in spot steel prices.
In the past, substantial price
decreases during periods of economic weakness have not
always been offset by commensurate price increases during
periods of economic strength.
Market prices for iron ore are also affected by supply and
demand conditions. Excess iron ore supply relative to demand
has led to depressed prices at various points in recent years
and could recur, with potentially a corollary effect on steel
prices. No assurance can be given that iron ore prices will not
decline further, particularly if there is a recession, Chinese steel
demand declines, worldwide capacity increases due to new
mines coming online or steel demand declines again due, for
example, to the negative effects from the continuing Russia-
Ukraine and Middle East conflicts, or other regional conflicts, in
particular on energy supply and prices.
The steel industry suffers from structural overcapacity globally,
especially for long products. This overcapacity is affected by
global macroeconomic trends and amplified during periods of
global or regional economic weakness, leading to weaker global
or regional demand, increased exports and/or decreased
regional or global prices. In particular, China is both the largest
global steel consumer and the largest global steel producer by a
large margin. At various points in the past and since the second
quarter of 2024, weaker Chinese steel demand has not been
fully offset by reduced Chinese steel production (due to large
price gaps compared to markets outside China), which has led
to a flood of Chinese steel exports into various regional markets,
including the Company’s principal markets, weighing on demand
and indeed depressing market prices. If this trend persists, it will
likely lead to rising inventory levels in steel markets outside of
China and continued downward pressure on prices and
spreads, negatively affecting the Company’s profitability. Exports
by steel producers in other developing countries and regions
(such as the CIS, Turkey and India) into the Company’s principal
markets are also a market feature. The extent of these exports
depends on the demand/production balance in the producer’s
home market as well as on regional market pricing differentials
(including any applicable import tariffs). The European steel
market is particularly sensitive to the import threat due to
structural overcapacity
, which may also be aggravated by any
new
or reinstated tariffs (such as those announced in the United
States). See “Unfair trade practices, import tariffs and/or,
barriers to free trade could negatively affect steel prices and
ArcelorMittal’s results of operations in various markets”.
In terms of inventory, steel stocking and destocking cycles affect
apparent demand for steel and hence steel prices and steel
producers’ profitability. For example, steel distributors may
accumulate substantial steel inventories in periods of low prices
and, in periods of rising real demand for steel from end-users,
steel distributors may sell steel from inventory (destock), thereby
delaying the effective implementation of steel price increases.
Conversely, steel price decreases can sometimes develop their
own momentum, as customers adopt a “wait and see” attitude
and destock in the expectation of further price decreases. The
trajectory of steel and iron ore demand and prices going
forward, in particular in 2025, is difficult to predict, including
given the variables described above. A scenario of prolonged
low steel and (to a lesser extent or if simultaneous) iron ore
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prices, whether or not combined with low steel demand, would
have a material adverse effect on ArcelorMittal’s results of
operations and financial condition.
Moreover, a renewed phase
of steel and iron ore oversupply would likely have a material
adverse effect on ArcelorMittal’s results of operations and
financial condition.
Volatility in the supply and prices of raw materials, energy
and volatility in steel prices or mismatches between steel
prices and raw material prices could adversely affect
ArcelorMittal’s results of operations.
Steel production consumes substantial amounts of raw
materials (the prices of which have been highly volatile in recent
years) including iron ore, coking coal and coke, and the
production of direct reduced iron, the production of steel in EAF
and the re-heating of steel involve the use of significant amounts
of energy, making steel companies, such as ArcelorMittal,
dependent on the price of, and their reliable access to, supplies
of raw materials and energy. Although ArcelorMittal has
substantial sources of iron ore from its own mines (the
Company’s self-sufficiency rate was 58% for iron ore in 2024), it
remains exposed to volatility in the supply and price of iron ore
and coking coal given that it obtains a significant portion of such
raw materials under supply contracts from third
parties
. Industry
and overall decarbonization efforts may also result in increased
and/or volatile prices, in particular, higher energy and carbon
dioxide ("CO
2
") prices as well as scrap prices (due in particular
to an industry shift to EAF production). See "“Business overview
—Products—Mining products”, “Business overview—Products—
Other raw materials and energy” and “Operating and financial
review—Key factors affecting results of operations—Raw
materials”. The compression of steel spreads, including from
inflationary cost pressures and negative price-cost effects, has
resulted, and may in the future result, in the Company reducing
or ceasing production at certain plants. See "Key transactions
and events in 2024". Production cuts do not eliminate all costs
as the Company still incurs operating costs when production
capacity is idled and may incur increased costs to resume
production at idled facilities. Idling can also impact the long-term
health of assets, despite steps taken to protect them.
Furthermore, while steel and certain raw material (in particular
iron ore and coking coal) price trends have historically been
correlated,
the Company has experienced (particularly in
Europe and North America) negative price-cost effects due to
differences in steel and raw material price trends (including due
to sudden spikes in raw material prices). See "Operating and
financial review—Key factors affecting results of operations".
The Company is likely to continue to experience such negative
effects in the future as this is a structural feature.
ArcelorMittal’s other principal input costs that affect its level of
profitability are energy and transportation. Energy expenses are
sensitive to changes in electricity, energy transportation and fuel
prices, including diesel fuel, natural gas and industrial gas.
While the Group has some long-term contracts with electrical,
natural gas and industrial gas suppliers, it is exposed to
fluctuations in electricity, natural gas and industrial gas prices
that can fluctuate widely with availability and demand levels
from other users. In addition, in certain circumstances (such as
periods of peak usage), supplies of energy in general may be
curtailed, and the Company may not be able to purchase them
at historical rates or at all. Supply disruptions may also cause
energy prices to increase, as has occurred previously (and is
likely to occur in the future) due to geopolitical conflicts (such as
the Russian-Ukraine war and conflicts in the Middle East)
and
destructions of gas pipelines. Such events and any other
significant cuts in energy supplies or a collapse in demand due
to supply issues or otherwise have resulted, and may in the
future result, in the Company having to cut production regionally
or globally. Indirectly, if steel-using customers are unable to
source the energy supplies needed for their operations, they will
be unable to operate and their demand for steel will decline.
Unfair trade practices, import tariffs and/or barriers to free
trade could negatively affect steel prices and
ArcelorMittal’s results of operations in various markets
.
ArcelorMittal is exposed to the effects of “dumping” and other
unfair trade and pricing practices by competitors. Moreover,
government subsidies to the steel industry remain widespread in
certain countries, particularly those with centrally controlled
economies such as China. In periods of lower global demand for
steel, there is an increased risk of additional volumes of unfairly-
traded steel exports into various markets, including Europe,
North America and other markets such as Brazil and South
Africa, in which ArcelorMittal produces and sells its products.
Such imports have had and could in the future have the effect of
reducing prices and demand for ArcelorMittal’s products.
ArcelorMittal is also exposed to the effects of import tariffs, other
trade barriers and protectionist policies more generally due to
the global nature of its operations. Various countries have
instituted, and may institute import tariffs and barriers that could,
depending on the nature of the measures adopted, adversely
affect ArcelorMittal’s business by limiting the Company’s access
to or competitiveness in steel markets. While such protectionist
measures can help the producers in the adopting country, they
may be ineffective (or only effective in the short-term), raise the
risk of exports being directed to markets where no such
measures are in place or are less effective and/or result in
retaliatory measures.
The prospect of higher tariffs, protectionist measures, increased
trade disputes and retaliatory actions is heightened in 2025
based on recent actions and announcements in various
countries, including Brazil, Turkey and India, as well as the
changing policies of the new U.S. administration. For example,
in February 2025, the U.S. administration announced new
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Section 232 tariffs, reinstating a 25% tariff on all steel imports as
from March
2025
. Export sales of steel products from the
Company to the U.S. market represented $6.7 billion in 2024. As
was the case in 2018, new retaliatory protectionist measures
may be announced in the European Union, Canada or in other
countries as a result. The imposition of tariffs (whether in the
United States or in other countries or regions) may in the short
term, pending increases in domestic production, result in higher
steel prices (enabling ArcelorMittal’s exports from Canada and
Mexico into the U.S. to remain competitive and profitable) and/or
increase the profitability of its domestic sales (by AMNS Calvert
sufficiently to offset the negative effect on export sales). It is
however unclear how long any such positive impact would last
and what impact further tariffs on a widening list of imported
products and retaliatory protectionist measures by other
countries may have on global trade and ultimately economic
growth, steel demand, steel and iron ore prices, or input costs
(including energy and raw materials). In addition, the new U.S.
administration and the U.S. Congress may make substantial
changes in legislation, regulation and government policy directly
affecting ArcelorMittal’s business or indirectly affecting the
Company because of impacts on its customers and suppliers;
the current U.S. administration may seek to renegotiate free
trade agreements or withdraw from the WTO, destabilizing
global trade.
In addition, certain operations of ArcelorMittal may be a
respondent to anti-dumping and countervailing duty cases and
its exported products have been and in the future may be
subject to anti-dumping and countervailing duties or other trade
restrictions.
Russia’s invasion of Ukraine, international reaction to it (in
particular in the form of sanctions) and any regional or
global escalation of the conflict, could adversely affect the
Company’s business, results of operations and financial
condition.
The Company has significant operations in Ukraine, consisting
of a steel plant and (captive) mines. See "Properties and capital
expenditures—Property, plant and equipment—Others".
After
operating at various levels of capacity in 2022/2023 affected by
various difficulties,
ArcelorMittal Kryvyi Rih ("AMKR") is currently
operating its open pit
mines
and steel facilities at
75%
and
23%
,
respectively. The Company cannot predict the duration of the
idling or of lower production as it will depend on the remaining
course of the conflict and the establishment of safe and stable
operating and logistical conditions thereafter,
as well as potential
repairs of any damages sustained
.
The Russian army has also
blocked ports in Odessa, complicating and increasing the cost of
exports (including steel and iron ore) from Ukraine. The ongoing
conflict, its impact on demand, logistics (with respect to both
supply and delivery) and costs and any resulting further reduced
production, sales and income at its Ukrainian operations have
caused the Company to record impairment charges (and may
be required to record additional charges in the future). For
further information on these risks, see notes 1.3 and 5.3 to the
consolidated financial statements.
The imposition of extensive sanctions on Russia by the EU, the
U.S., the UK and other countries could affect the Company’s
sourcing of raw materials from sanctioned countries. Any
business conducted in Russia and with Russian counterparties
also carries the risk of non-compliance with economic sanctions
(and the attendant financial and reputational adverse
consequences), despite best efforts to comply. In addition,
sanctions may remain in place beyond the duration of any
military conflict and have a long-lasting impact on the region and
could adversely impact the Company’s results of operations and
financial condition. More generally the conflict could have a
further material adverse effect on the overall macroeconomic
environment (see “Volatility in the supply and prices of raw
materials, energy and transportation, and volatility in steel prices
or mismatches between steel prices and raw material prices
could adversely affect ArcelorMittal’s results of operations”). The
conflict could escalate militarily both regionally and globally; any
substantial escalation would have a material adverse effect on
macroeconomic conditions.
Competition from other materials and alternative steel-
based technologies could reduce market prices and
demand for steel products and thereby reduce
ArcelorMittal’s cash flows and profitability.
In many of its applications, steel competes with other materials
that may be used as substitutes, such as aluminum, concrete,
composites, glass, plastic and wood. In particular, as a result of
increasingly stringent regulatory requirements, as well as
developments in alternative materials, designers, engineers and
industrial manufacturers, especially those in the automotive
industry, have increased their use of lighter weight and
alternative materials, such as aluminum and plastics.
A loss of market share to substitute materials, increased
government regulatory initiatives favoring the use of alternative
materials, as well as the development of additional new
substitutes for steel products could significantly reduce market
prices and demand for steel products and thereby reduce
ArcelorMittal’s cash flows and profitability.
New technologies such as carbon free steelmaking could also
result in a loss of market share if competitors develop and
deploy this kind of technology before, or more effectively than
ArcelorMittal. In addition, to the extent regulatory requirements
and/or customer demand for low carbon or carbon neutral steel
increase, competition with respect to low CO
2
steel technologies
may become more significant, leading to substantial input cost
increases.
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II. Risks related to sustainability
T
he Group’s announced carbon emissions intensity
reduction targets were based on assumptions with respect
to the costs, government and societal support for the
reduction of carbon emissions in particular regions and the
advancement of technology and infrastructure related to
the reduction of carbon emissions over time.
Future
developments may affect such assumptions, and this may
render the achievement of ArcelorMittal’s targets more
difficult, or even impossible, to achieve for cost or other
reasons.
The Company’s decarbonization strategy includes the objective
of carbon neutrality by
2050; the C
ompany's
medium-term
objective and associated decarbonization capital expenditures
are
currently under review. ArcelorMittal's ability to achieve this
objective depends on numerous factors and assumptions,
including the costs of green hydrogen (meaning hydrogen
produced exclusively from renewable sources) and its evolution
over time, the construction of DRI and EAF facilities, the
development of CCUS infrastructure and the timing of the
introduction of GHG reduction requirements and supportive
policies in applicable jurisdictions. In November 2024, the
Company announced that it was unable to take final investment
decisions on projects to replace blast furnaces with lower-
carbon technology in Europe due to current conditions in
European policy, energy and market environments, given green
hydrogen's very slow evolution towards becoming a viable fuel
source and natural gas-based DRI production in Europe not yet
being a competitive interim solution. The development of
l
ow
emissions technologies depends on more stringent global GHG
reduction requirements and/or the introduction of carbon prices
in each jurisdiction
, alongside the introduction of effective
policies to secure a level playing field.
However, since Europe is
currently the only major market to have implemented a cost on
carbon, the Company has indicated that it needs further support
from host countries, first and foremost from the European Union
and its Member States, through more supportive policies
designed to avoid “carbon leakage” and provide compensation
for the significantly higher
costs,
while at the same time
maintaining a fair and competitive landscape (particularly given
that the CBAM adopted by the EU does not appear sufficient to
ensure the level-playing field necessary to maintain the
competitiveness of the steel industry in Europe).
In addition, ArcelorMittal’s targets have been based on the
assumption that public funding covers 50% of the total cost of
decarbonization (capital expenditures and higher operating
expenses, which are expected to be significant) so that the
Company and industry are not rendered uncompetitive during
this transition period. The Company believes this assumption is
reasonable (and funding from certain governments has been
approved), but such funding is subject to changes in
government and policy, among other factors, and may not be
achieved.
See “Business overview—Sustainable development—
Climate change and decarbonization". The new Trump
administration in the United States appears unlikely to provide
the support necessary for decarbonization, which may also
influence adoption of such policies and support worldwide. A
lack of governmental and societal support could make the
Company’s targets more costly, more difficult or even impossible
to achieve.
If the Company is unable to make the necessary
investments to decarbonize and reach its decarbonization
targets due to the design of governmental policy in Europe or
other jurisdictions where it operates (see “—Changes in
assumptions underlying the carrying value of certain assets,
including as a result of adverse market conditions, could result
in the impairment of such assets, including intangible assets
such as goodwill”), it may negatively affect its competitiveness,
profitability, cash flows, financing costs
,
results of operations
and financial condition, as well as harm its reputation.
Laws and regulations restricting emissions of greenhouse
gases could force ArcelorMittal to incur increased capital
and operating costs and could have a material adverse
effect on ArcelorMittal’s results of operations, financial
condition and reputation.
The integrated steel
process involves significant carbon-
footprint
. Compliance with new and more stringent
environmental obligations relating to GHG emissions, including
as part of the EU’s “Fit for 55” package, may require additional
capital expenditures or modifications in operating practices, as
well as additional reporting obligations. See “Business Overview
– Government Regulations—Environmental laws and
regulations—Climate Change".
The new laws are all interconnected, and they combine:
tightening and extending the existing emission trading system
("EU-ETS"); increased use of renewable energy; greater energy
efficiency; a faster roll-out of low emission transport modes and
the infrastructure and fuels to support them; an alignment of
taxation policies with the European Green Deal objectives; a
carbon border adjustment mechanism ("CBAM") to prevent
carbon leakage; and tools to preserve and grow natural carbon
sinks. Of particular relevance are the amending EU-ETS
directive and the CBAM regulation, which entered into force in
mid-2023, and will mainly impact the carbon emissions
allowances from the second trading period of Phase IV of the
EU-ETS (i.e., 2026-2030) onwards.
The implementation of Phase IV rules (applicable during the
2021-2030 period) has already resulted in increased EU
allowances prices, which the Company expects will continue to
increase, despite recent volatility. Moreover, as from 2026 free
allocation of CO
2
emissions allowances will be progressively
phased out (and completely phased out as from 2034).
This will
contribute to a very significant shortage in free allocation in the
later years of the second trading period of Phase IV (given the
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amount of CO
2
emission allowances is currently insufficient to
satisfy technically achievable operating conditions) and lead to
significant increases in prices for emissions allowances.
The
Company’s operations will be subject to the additional costs
from these purchases, many of which may be significant and
higher than currently expected and may or may not be
effectively hedged in the future. In addition, the effectiveness of
the CBAM remains untested and the provisions to address
circumvention risks, including resource shuffling and cost
absorption, may be insufficient, and no solution for exports has
yet to be considered.
Similar regulations have been implemented to date in several
jurisdictions, and additional measures may well be enacted in
the future in other jurisdictions. Whether in the form of a national
or international cap-and-trade emissions permit system, a
carbon tax or acquisition of emission rights at market prices,
emissions controls, reporting requirements, or other regulatory
initiatives, such environmental regulations could have a negative
effect on ArcelorMittal’s production levels, income and cash
flows. These regulations could also negatively affect the
Company’s suppliers and customers, which could translate into
higher costs and lower sales.
Furthermore, many developing nations have not yet instituted
significant GHG regulations, and the Paris Agreement
specifically recognizes that GHG emissions will peak later in
developing countries. As the Intended Nationally Determined
Contributions (“INDC”) for developing nations under the Paris
Agreement may be less stringent than for developed nations in
light of different national circumstances, ArcelorMittal may be at
a competitive disadvantage relative to steelmakers having more
or all of their production in developing countries. Depending on
the extent of the difference between the requirements in
developed regions (such as Europe) and developing regions
(such as China or the CIS), this competitive disadvantage could
be severe and has resulted, and in the future may result, in
production cuts due to relatively higher carbon costs rendering
production structurally unprofitable. See "Properties and capital
expenditures—Property, plant and equipment” for further
information regarding production levels by segment.
In addition, as regulators and investors increasingly focus on
climate change issues, the Company is exposed to the risk of
frameworks and regulations being adopted that are ill-adapted
to steel industry dynamics
. For example, the most established
framework for carbon pricing and emissions trading schemes is
currently the EU-ETS discussed above. As indicated above,
while a CBAM has been adopted to limit competitive distortions
from the ETS, it does not appear sufficient to enable the steel
industry in Europe to remain competitive. Furthermore, the
European Climate Law requires the Commission to present a
legislative proposal of a Union 2040 target within six months of
the first global stocktake, which concluded at COP28 in Dubai in
December 2023. In February 2024, the Commission presented
a communication recommending a 90% reduction in net
emissions by 2040 compared to 1990, in line with the advice of
the Scientific Advisory Board. The legislative proposal to table
the 2040 climate target is the responsibility of the new
Commission. It is expected that such a target would trigger a
further review of the EU-ETS cap, likely leading to a tightened
market that might drive higher prices for allowances.
For further information on environmental laws and regulations
and how they affect the Company’s operations, see “Business
overview—Government regulations—Environmental laws and
regulations” and note 9.1 to the consolidated financial
statements.
ArcelorMittal is subject to strict environmental, health and
safety laws and regulations that could give rise to a
significant increase in costs and liabilities.
ArcelorMittal is subject to a broad range of environmental,
health and safety laws and regulations in each of the
jurisdictions in which it operates. These laws and regulations
impose increasingly stringent standards regarding general
health and safety, air emissions, discharges of wastewater, the
use, handling and transportation of hazardous, toxic or
dangerous materials, waste disposal practices and the
remediation of environmental contamination, and health and
safety matters, and permit requirements/limits among other
things. The costs of complying with, and the imposition of
liabilities pursuant to, these laws and regulations can be
significant, and compliance with new and more stringent
obligations may require additional capital expenditures or
modifications in operating practices. Failure to comply can result
in civil and or criminal penalties being imposed, the suspension
of permits, requirements to curtail or suspend operations and
lawsuits by third parties.
Despite ArcelorMittal’s efforts to comply with environmental,
health and safety laws and regulations, and monitor and reduce
accidents at its facilities, health, safety and environmental
incidents or accidents, including those involving serious injury or
death, have occurred and may in the future occur. Such
accidents could include (and in certain instances have included)
explosions or gas leaks, fires or collapses in underground
mining operations, crushing incidents, vehicular accidents, falls
while working at heights, and other accidents involving mobile
equipment, or exposure to radioactive or other potentially
hazardous, toxic or dangerous materials, which have had, and
could in the future have, significant adverse consequences for
the Company’s workers and facilities, as well as the
environment. F
or example, the Company’s previous operations
in Kazakhstan suffered several fatal accidents.
Certain of these incidents may result in costs and liabilities and
negatively impact the Company’s reputation or the operations of
the affected facilities. Such accidents could lead to production
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stoppages, loss of personnel, loss of key assets, or put at risk
the Company’s employees (and those of sub-contractors and
suppliers) or persons living near affected sites. In addition, any
gap between community and worker expectations and
ArcelorMittal’s environmental, health and safety perceived
performance, as a result of any accidents, safety incidents or
even the perception of potential safety or environmental issues,
may negatively impact community relations, labor relations,
customer relations and the Company’s reputation and result in
disruptions to the Company’s operations.
ArcelorMittal’s
operations may also be located in areas where individuals or
communities could regard its activities as having a detrimental
effect on their natural environment and conditions of life, and
actions taken by such individuals or communities in response to
such concerns could compromise ArcelorMittal’s profitability or,
in extreme cases, the viability of an operation or the
development of new activities in the relevant region or country.
ArcelorMittal also incurs costs and liabilities associated with the
assessment and remediation of contaminated sites, and in its
mining activities, those resulting from tailings and sludge
disposal, effluent management, and rehabilitation of land
disturbed during mining processes. In addition to the impact on
current facilities and operations, environmental remediation
obligations can give rise to substantial liabilities in respect of
divested assets and past activities. This may also be the case
for acquisitions when liabilities for past acts or omissions are not
adequately reflected in the terms and price of the acquisition.
ArcelorMittal could become subject to further remediation
obligations in the future, as additional contamination is
discovered or clean-up standards become more stringent.
In addition, with respect to sustainability reporting, if based on
information disclosed in accordance with new requirements
(such as the Corporate Sustainability Reporting
Directive, which
specifies extensive and detailed sustainability information to be
provided based on the reporting standard published in July
2023,
or any new SEC rules) or otherwise, financial institutions
or other stakeholders (including the public) begin to view
investments in steel and mining as undesirable, it may become
more difficult and/or more expensive for the Company to obtain
financing. While the Company has taken significant steps and
continues to adapt its operations in light of climate change and
the need for sustainability, such steps may not be in line with
future frameworks or regulations or market views of investment
suitability. Moreover, the Company may in the future face
increasing shareholder activism and/or litigation in relation to
sustainability matters.
For further information, see “Business overview—Sustainable
development—
Health and safety
”
and “Business overview—
Government regulations—Environmental laws and regulations”
and note 9.1 to the consolidated financial statements.
III. Risks related to ArcelorMittal's operations
ArcelorMittal could experience labor disputes that could
have an adverse effect on its operations and financial
results.
A majority of ArcelorMittal's employees and contractors are
represented by labor unions and covered by collective
bargaining or similar agreements, which are subject to periodic
renegotiation. Strikes and work stoppages have occurred, and
are likely to occur in the future, at various ArcelorMittal facilities
prior to or during negotiations preceding new collective
bargaining agreements, during wage and benefits negotiations
or during other periods for other reasons, in particular in
connection with any announced intentions to adapt its footprint.
Strikes or work stoppages, particularly when prolonged, could
disrupt ArcelorMittal’s operations and relationships with its
customers, as well as limit its ability to rationalize operations
and reduce labor costs in certain markets, resulting in an
adverse effect on its operations and financial results.
Disruptions to ArcelorMittal’s manufacturing processes and
mining operations caused for example by equipment
failures, natural disasters, accidents, explosions, epidemics
or pandemics, geopolitical conflicts or extreme weather
events could adversely affect its operations, customer
service levels and financial results and liabilities.
Steel manufacturing processes are dependent on critical steel-
making equipment, such as furnaces, continuous casters, rolling
mills and electrical equipment (such as transformers), and such
equipment may incur downtime as a result of unanticipated
failures or other events, such as fires, explosions, furnace
breakdowns or as a result of natural disasters, accidents,
epidemics or pandemics or severe weather conditions.
ArcelorMittal’s manufacturing plants and mines have
experienced, and may in the future experience, plant shutdowns
or periods of reduced production as a result of such events.
ArcelorMittal’s mining operations, in particular, are subject to the
hazards and risks usually associated with the exploration,
development and production of natural resources through either
open-pit or underground mining operations, any of which could
result in production shortfalls or damage to persons or property,
delay production, increase production costs and result in death
or injury to persons, damage to property and liability for
ArcelorMittal, some or all of which may not be covered by
insurance, as well as substantially harm ArcelorMittal’s
reputation, both as a Company focused on ensuring the health
and safety of its employees and more generally. Certain of these
incidents have resulted or may result in fatalities, production
stoppages, governmental investigations or proceedings and/or
in costs and liabilities and negatively impact the Company’s
reputation or the operations of the affected facilities. Such
hazardous incidents could also lead to loss of key personnel,
loss of key assets, or health and safety risks for ArcelorMittal's
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employees (and those of sub-contractors and suppliers) or
persons living near affected sites. See also “—ArcelorMittal is
subject to strict environmental, health and safety laws and
regulations that could give rise to a significant increase in costs
and liabilities”. Conflicts may also cause interruptions to
operations; see “—Russia’s invasion of Ukraine, international
reaction to it (in particular in the form of sanctions) and any
regional or global escalation of the conflict, could adversely
affect the Company’s business, results of operations and
financial condition”.
In addition, natural disasters and severe weather conditions
have
led
, and could in the future lead, to significant damage at
ArcelorMittal’s production facilities and general infrastructure or
cause shutdowns, including due to earthquakes, tsunamis,
tornados, hurricanes and bush fires. More generally, changing
weather patterns and climatic conditions in recent years,
possibly due to climate change, have added to the
unpredictability and frequency of natural disasters.
Severe weather conditions can also affect ArcelorMittal’s
operations in particular due to the long supply chain for certain
of its operations and the location of certain operations in areas
subject to harsh winter conditions (i.e., Canada) or areas that
are susceptible to droughts (i.e., South Africa, Mexico and
Brazil). Water in particular is crucial to the steelmaking process,
and the risk that the authorities may restrict license to withdraw
water as a result of chronic drought could increase operating
costs and reduce production capacity. Flooding has also
affected ArcelorMittal’s operations, impacting shipment volumes
due to handling and logistic constraints. Damage to ArcelorMittal
production facilities due to natural disasters and severe weather
conditions could, to the extent that lost production cannot be
compensated for by unaffected facilities, adversely affect its
business, results of operations or financial condition. More
generally, these severe weather conditions could increase in
frequency and severity due to climate change.
ArcelorMittal’s reserve and resource estimates may
materially differ from mineral quantities that it may be able
to actually recover; ArcelorMittal’s estimates of mine life
may prove inaccurate; and changes in iron ore prices,
operating and capital costs and other assumptions used to
calculate these estimates may render certain reserves and
resources uneconomical to mine.
There is a degree of uncertainty attributable to the estimation of
mineral reserves and resources. Until mineral reserves and
resources are actually mined and processed, the quantity of
metal and grades must be considered as estimates only and no
assurance can be given that the indicated levels of metals will
be produced.
The estimation of mineral reserves and resources is a subjective
process that is partially dependent upon the judgment of the
qualified persons preparing such estimates. The process relies
on the quantity and quality of available data and is based on
knowledge, mining experience, statistical analysis of drilling and
sampling results and industry practices. Valid estimates made at
a given time may significantly change when new information
becomes available.
ArcelorMittal periodically updates its mineral reserve and
resources estimates based on the conclusions of the relevant
qualified persons with respect to new data generated from
exploratory and infill drilling campaigns, results from technical
studies and the experience acquired during the operation of the
mine and metallurgical processing, as well as changes to the
assumptions used to calculate these estimates. Additional data
generated may not be consistent with the data on which
previous mineral resources and mineral reserves were based.
Therefore, estimates may change from period to period or may
need to be revised, and there can be no assurance that the
mineral resources or mineral reserves in this report will be
recovered at the grade, quality or quantities presented.
As a result, there can be uncertainty in the assumptions used
that may materially impact and result in significant changes to
the Company’s current estimates. The assumptions that can
fluctuate may include, but are not limited to: market prices
including long-term forecasts; operating and capital costs;
changes to estimation input parameters and techniques; and
changes to cut-off grades, mining, and metallurgical recovery
rates and, with respect to mineral resources, further
engineering, legal and economic feasibility that would allow for
the conversion to mineral reserves. These changes may also
rend
er some or all of ArcelorMittal's current proven and probable
mineral reserves and measured and indicated mineral resources
uneconomic to exploit and may ultimately result in a reduction of
mineral reserves and resources. In addition, no assurance can
be given that mineral resources (in particular inferred mineral
resources, which are subject to a greater amount of uncertainty
as to their existence and their economic and legal feasibility) will
be upgraded to a higher category or that any of the mineral
resources not already classified as mineral reserves will be
reclassified as mineral reserves.
If a project proves not to be economically feasible by the time
ArcelorMittal is able to exploit it, ArcelorMittal may incur
substantial losses and be obliged to recognize impairments. In
addition, potential changes or complications involving
metallurgical and other technological processes that arise during
the life of a project may result in delays and cost overruns that
may render the project not economically feasible. In addition,
ArcelorMittal faces rising extraction costs over time as reserves
deplete.
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ArcelorMittal’s reputation and business could be materially
harmed as a result of data breaches, data theft,
unauthorized access or suspected or successful hacking
.
ArcelorMittal’s operations depend on the secure and reliable
performance of its information technology systems.
ArcelorMittal, has experienced, and continues to experience,
increasing intrusion attempts on its computer networks through
sophisticated and targeted phishing, ransomware and virus
attacks, some of which have resulted, and may in the future
result, in breaches of its information technology security. See "—
Cybersecurity".
Adverse consequences of technological advances like Industry
4.0, Cloud Computing, Internet of Things, GenAi and Blockchain
may continue to increase threats or cause damage to
ArcelorMittal, for example by impacting shop-floor systems
supporting production and maintenance and thereby forcing
plant operations to revert to manual mode with loss of
production, resulting in new risks to ArcelorMittal’s operations
and systems. Because the techniques used to obtain
unauthorized access, disable or degrade service or sabotage
systems change frequently and often are not recognized until
launched against a target, the Company may be unable to
anticipate these techniques or to implement in a timely manner
effective and efficient countermeasures. Although ArcelorMittal
performs annual cyber maturity assessments in many of its
business units, which are supplemented by in-depth cyber
audits and penetration testing exercises performed by
ArcelorMittal Global Assurance, the risk of significant data
breaches, data theft, unauthorized access or successful hacking
cannot be eliminated. There may also be an increased risk of
cybersecurity breaches due to ongoing geopolitical tensions
involving Russia or China. See also "—Cybersecurity".
If unauthorized parties attempt or manage to bring down the
Company’s website or force access into its information
technology systems, they may be able to misappropriate
personal and confidential information, cause interruptions in the
Company’s operations, damage its computers or process
control systems or otherwise damage its reputation and
business. Any compromise of the security of the Company’s
information technology systems or those of its suppliers or
service providers could impact the Company’s ability to maintain
operations, disrupt the provision of services, result in a loss of
confidence in the Company’s security measures, subject it to
litigation, civil or criminal penalties, regulatory actions (e.g.,
under the EU’s General Data Protection Regulation) or adverse
publicity, any of which could adversely affect its financial
condition and results of operations.
IV. Risks related to ArcelorMittal’s acquisitions and investments
ArcelorMittal has grown through acquisitions and may
continue to do so. Failure to manage external growth and
difficulties completing planned acquisitions or integrating
acquired companies could harm ArcelorMittal’s future
results of operations, financial condition and prospects.
The Company has made several large acquisitions in recent
years. To the extent ArcelorMittal continues to pursue significant
acquisitions, the associated financing may (depending on the
structure) result in increased debt, leverage and gearing.
Acquisitions also entail increased operating costs, as well as
greater allocation of management resources away from daily
operations. Managing acquisitions requires the continued
development of ArcelorMittal’s financial and management
information control systems, the integration of acquired assets
with existing operations, the adoption of manufacturing best
practices, handling any labor disruptions that may arise,
attracting and retaining qualified management and personnel as
well as the continued training and supervision of such
personnel, and the ability to manage the risks and liabilities
associated with the acquired businesses. Acquisitions also have
resulted, and may in the future result, in subsequent disputes or
financial liabilities, including in respect of put options granted to
selling shareholders over a retained minority stake. See note 9.3
to the consolidated financial statements for further information.
In addition, acquisitions may entail future capital expenditures,
either as a condition or in order to realize synergies, operational
efficiencies or strategic benefits. Such capital expenditure may
not provide the anticipated return on investment. More generally,
failure to manage acquisitions could have a material adverse
effect on ArcelorMittal’s business, financial condition, results of
operations or prospects.
ArcelorMittal is currently and in the future may be subject
to legal proceedings or other proceedings, including in
relation to its interest in ADI, the resolution of which could
negatively affect the Company’s profitability and cash flows
in a particular period.
ArcelorMittal’s profitability or cash flows in a particular period
could be affected by adverse rulings in current and future legal
proceedings against the Company. See note 9.3 to the
consolidated financial statements.
In April 2021, ArcelorMittal and Invitalia, an Italian state-owned
company, formed a public-private partnership, ADIH, to operate
and subsequently acquire the Ilva business (which had to that
point been managed by the Company and Italian-government
appointed commissioners), providing Invitalia with joint control
rights. In February 2024, the Italian government placed ADIH’s
main operating subsidiary ADI in EA (followed by a Milan court
determination of ADI’s insolvency), thereby passing control of
the company to government-appointed commissioners and
stripping ArcelorMittal of its rights as an indirect shareholder of
ADI. ArcelorMittal was subsequently stripped of its rights as a
direct shareholder in ADIH after being placed in
EA
and a Milan
court determination of its insolvency. The Company's appeal
against the Milan court decision is currently pending.
ArcelorMittal has also appealed the Italian government EA
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decrees and the decrees authorizing ADI’s commissioners to
enter into a new interim lease agreement with Ilva’s
commissioners (to which ADIH is not a party) and authorizing a
new sale process for Ilva’s business. Hearings before the court
have not yet taken place. The subsequent placement of ADI and
ADIH in EA, a complex procedure, could well lead to further
disputes. In this respect, in July 2024 the commissioners of ADI
and ADIH filed with the court of Milan a request for an urgent
technical assessment of the Ilva facilities stated to be in view of
a potential claim for damages against AMIH and certain former
directors of ADI; in December 2024 the Milan court rejected the
request and its decision has since become final (without
prejudice to a potential subsequent claim for damages).
ArcelorMittal’s
strategic growth, maintenance and
decarbonization
projects are subject to financing,
execution and completion risks.
The Company has announced a number of strategic growth and
decarbonization projects, which are capital intensive, and also
regularly invests in significant maintenance capital expenditures.
See “Properties and capital expenditures—Property, plant and
equipment—Investments in joint ventures” and “Properties and
capital expenditures—Capital expenditures”. The cost or time to
complete any of these projects may prove to be greater than
originally anticipated. Timely completion in accordance with
budgeted amounts and successful operation may be affected by
factors beyond the control of ArcelorMittal. These factors include
receiving financing on reasonable terms, obtaining or renewing
required regulatory approvals and licenses, securing and
maintaining adequate property rights to land and mineral
resources, local opposition to land acquisition or project
development, managing relationships with or obtaining consents
from other shareholders, revision of economic viability
projections, demand for the Company’s products, local
environmental or health-related conditions, and general
economic conditions. Any of these factors may cause the
Company to delay, modify or forego some or all aspects of its
development projects. For investment projects that the
Company expects to fund primarily through internal sources,
these sources may prove insufficient depending on the amount
of internally generated cash flows and other uses of cash, and
the Company may need to choose between incurring external
financing or foregoing the investment. The Company cannot
guarantee that it will be able to execute its greenfield, brownfield
or other investment projects, and to the extent that they
proceed, that it will be able to complete them on schedule,
within budget, or achieve
the volumes, revenues or
anticipated
return on its investment. Conversely, should the Company
decide to postpone or cancel development projects, it could
incur various negative consequences such as litigation or
impairment charges, as well as loss of anticipated strategic
benefits.
ArcelorMittal faces risks associated with its investments in
joint
ventures and ass
ociates.
ArcelorMittal has investments in numerous joint ventures and
associates for a total carrying amount of
$
11.4
billion at
December 31, 2024. See “Properties and capital expenditures—
Property, plant and equipment—Investments in joint ventures”
and note 2.4 to the consolidated financial statements. In
particular, it has structured significant growth transactions in
recent years, including Calvert, AMNS India and the joint
venture with
Casa dos Ventos
. Joint ventures and associates
subject ArcelorMittal to several types of risks.
First, risks that are endemic to joint ventures and associates
generally due to their nature as entities over which control is
shared or where ArcelorMittal only exercises significant
influence. These include the risk of dead-lock and/or
coordination issues affecting the implementation of strategy. To
the extent joint ventures and associates are controlled and
managed by partners, they may not fully comply with
ArcelorMittal’s standards, controls and procedures, including
ArcelorMittal’s health, safety, environment and community
standards; this could lead to higher costs, reduced production or
environmental, health and safety incidents or accidents, which
could adversely affect ArcelorMittal’s results and reputation.
Second, joint ventures may be the source of substantial
expenditures and financial exposure. Although ArcelorMittal’s
joint ventures are responsible for their own debt repayment and
the Company does not consolidate their indebtedness but has
guaranteed certain debt or contractual obligations of its joint
ventures (see note 9.4 to ArcelorMittal’s consolidated financial
statements). Particularly if the joint venture experiences financial
difficulties, ArcelorMittal may make substantial cash
contributions to extend loans or address calls on existing
guarantees and is exposed to a risk of loss of its
investment
.
Financial risks may be particularly high for joint ventures that are
strategic and that are expanding and developing, such as AMNS
India and Calvert
(see "Property and Capital expenditures—
Investments in joint ventures” and "Property and Capital
expenditures—Capital expenditures")
. AMNS India, in particular,
has large-scale and ambitious projects to expand its operations
and further improve operational profitability, which may either
not come to fruition or require greater than anticipated
investments or expenditures. AMNS India has also made
significant acquisitions in recent years that it
has financed with
its own cash and drawings under existing financings (including
ones guaranteed by its shareholders). The Company currently
expects that any future acquisitions would likely be similarly
financed.
Moreover,
the joint venture has announced $7.7 billion
in projected capital expenditure requirements that it expects to
finance similarly (subject to potential cost overruns).
The risks in
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this respect are compounded to an extent by the fact that AMNS
India is owned and operated by a joint venture with attendant
risks around strategic alignment, potential discord and deadlock.
ArcelorMittal’s investments in joint ventures and associates
(whether current investments or future ones) have resulted, and
may in the future result, in impairments (the Company
recognized a $1.4 billion impairment charge with respect to its
investment in ADI in 2023).
V
. Risks related to ArcelorMittal’s financial position and
organizational structure
Changes in assumptions underlying the carrying value of
certain assets, including as a result of adverse market
conditions, could result in the impairment of such assets,
including intangible assets such as goodwill
.
At each reporting date, in accordance with the Company’s
accounting policy described in note 5.3 to the consolidated
financial statements, ArcelorMittal reviews the carrying amounts
of its tangible and intangible assets (goodwill is reviewed
annually or whenever changes in circumstances indicate that
the carrying amount may not be recoverable) to determine
whether there is any indication that the carrying amount of those
assets may not be recoverable through continuing use. If any
such indication exists, the recoverable amount of the asset (or
cash-generating unit) is reviewed in order to determine the
amount of the impairment, if any.
If certain of management’s estimates change during a given
period, such as the discount rate, capital expenditures, expected
changes to average selling prices, growth rates, shipments and
direct costs, the estimate of the recoverable amount of goodwill
or the asset could fall significantly and result in impairment.
The
Company has recorded significant impairment charges over the
years, including recently.
While impairment does not affect
reported cash flows, decreases of the estimated recoverable
amount and the related non-cash charge in the consolidated
statements of operations have had and could have a material
adverse effect on ArcelorMittal’s results of operations.
Substantial amounts of goodwill and tangible and intangible
assets remain recorded on the Company’s consolidated
statement of financial position. As of December 31, 2024, the
Company’s balance sheet included $
3.6
billion of goodwill.
More generally, no assurance can be given as to the absence of
significant further impairment losses in future periods,
particularly if market conditions deteriorate. In particular,
changes in key assumptions used in the Group’s impairment
tests, due to market conditions, regulations (including
environmental and carbon emission regulations) or other
reasons (for example, assumptions regarding decarbonization
costs) may result in additional impairment losses being
recognized in the future. For further information on these risks
and uncertainties in assumptions, see notes 1.3 to the
consolidated financial statements.
ArcelorMittal’s indebtedness could have an adverse impact
on its results of operations and financial position, and the
market’s perception of ArcelorMittal’s leverage or of certain
financial transactions may affect the price of its securities
.
As of December 31, 2024, ArcelorMittal had total debt
outstanding of
$11.6 billion
,
$6.5 billion
of cash and cash
equivalents and restricted cash, and $5.5 billion available to be
drawn under existing credit facilities. The Company also relies
on its true sale of receivables programs (
$4.4 billion
of trade
receivables sold at December 31, 2024), as a way to manage its
working capital cycle. A substantial increase in indebtedness
could contribute to the Company’s vulnerability to adverse
economic and competitive pressures in its industry, limit
flexibility in planning for, or reacting to, changes in its business
and industry; limit its ability to borrow additional funds on terms
that are acceptable to the Company or at all. More generally, a
deterioration of market conditions may impact ArcelorMittal’s
ability to refinance its indebtedness on acceptable conditions or
at all. In addition, credit rating agencies could downgrade
ArcelorMittal’s ratings either due to factors specific to
ArcelorMittal, a prolonged cyclical downturn in the steel industry
and mining industries, macroeconomic trends (such as global or
regional recessions or economic shocks) or trends in credit and
capital markets more generally. The margin under ArcelorMittal’s
principal credit facilities and certain of its outstanding bonds is
subject to adjustment in the event of a change in its long-term
credit ratings, and downgrades that occurred in the past resulted
in increased interest expense.
Restrictive covenants in ArcelorMittal’s debt instruments (current
or future) may limit ArcelorMittal’s operating and financial
flexibility. Failure to comply with any covenant would enable the
lenders to accelerate ArcelorMittal’s repayment
obligations
. In
addition, the mere market perception of a potential breach of
any financial covenant, to the extent in effect, could have a
negative impact on ArcelorMittal’s ability to refinance its
indebtedness on acceptable conditions.
In addition to the foregoing specific risks relating to
ArcelorMittal’s indebtedness, the prices of its securities may be
affected by the markets’ perception of its leverage or any
potential financial transactions, such as equity offerings, which
may be implemented to increase financial flexibility.
ArcelorMittal’s ability to fully utilize its recognized deferred
tax assets depends on its profitability and future cash
flows.
At December 31, 2024, ArcelorMittal had $
8.9
billion recorded
as deferred tax assets on its consolidated statement of financial
position, representing a $0.6 billion decrease as compared to
December 31,
2023
. The deferred tax assets can be utilized
only if, and only to the extent that, ArcelorMittal’s operating
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subsidiaries generate adequate levels of taxable income in
future periods to offset the tax loss carry forwards and reverse
the temporary differences prior to expiration. At December 31,
2024, the amount of future income required to recover
ArcelorMittal’s deferred tax assets of $
8.9
billion was at least
$
39.3 billion
at certain operating subsidiaries.
ArcelorMittal’s ability to generate taxable income is subject to
general economic, financial, competitive, legislative, regulatory
and other factors that are beyond its control. If ArcelorMittal
generates lower taxable income than the amount it has
assumed in determining its deferred tax assets, then the value
of deferred tax assets will be reduced. In addition, assumptions
regarding the future recoverability of deferred tax assets depend
on management’s estimates of future taxable income in
accordance with the tax laws applicable to ArcelorMittal’s
subsidiaries in the countries in which they operate. If in the
course of its assessments management determines that the
carrying amount of any of its deferred tax assets may not be
recoverable pursuant to such prevailing tax laws, the
recoverable amount of such deferred tax assets may be
impaired.
Underfunding of pension and other post-retirement benefit
plans at some of ArcelorMittal’s operating subsidiaries
could require the Company to make substantial cash
contributions to pension plans or to pay for employee
healthcare, which may reduce the cash available for
ArcelorMittal’s business.
ArcelorMittal’s principal operating subsidiaries in Brazil, Canada,
Europe and South Africa provide defined benefit pension and
other post-retirement benefit plans to their employees. Some of
these plans are currently underfunded, see note 8.2 to the
consolidated financial statements for the total value of plan
assets and any deficit.
ArcelorMittal’s funding obligations depend upon future asset
performance, which is tied to equity and debt markets to a
substantial extent, the level of interest rates used to discount
future liabilities, actuarial assumptions and experience, benefit
plan changes and government regulation. Because of the large
number of variables that determine pension funding
requirements, which are difficult to predict, as well as any
legislative action, future cash funding requirements for
ArcelorMittal’s pension plans and other post-employment benefit
plans could be significantly higher than current estimates.
Increases in the general life expectancy assumption have
contributed to increases in the defined benefit obligation. In
these circumstances, funding requirements could have a
material adverse effect on ArcelorMittal’s business, financial
condition, results of operations or prospects.
ArcelorMittal’s results of operations could be affected by
fluctuations in foreign exchange rates, particularly the euro
to U.S. dollar exchange rate, as well as by exchange
controls imposed by governmental authorities in the
countries where it operates.
ArcelorMittal operates and sells products globally and as a
result, its business, financial condition, results of operations or
prospects could be adversely affected by fluctuations in
exchange rates. A substantial portion of ArcelorMittal’s assets,
liabilities, operating costs, sales and earnings are denominated
in currencies other than the U.S. dollar (ArcelorMittal’s reporting
currency). Accordingly, its results of operations are subject to
translation risk (i.e., the U.S. dollar value of revenue and profits
generated in other currencies and its debt denominated in other
currencies), including, as has been recently occurred, due to the
reclassification of cumulative foreign exchange translation
losses upon a disposal of a subsidiary, and transaction risk (i.e.,
a mismatch between the currency of costs and revenue).
Moreover, ArcelorMittal operates in several countries whose
currencies are, or have in the past been, subject to limitations
imposed by those countries’ central banks, or which have
experienced sudden and significant devaluations. In emerging
countries where ArcelorMittal has operations and/or generates
substantial revenue, such as Argentina, Brazil, India, South
Africa, Venezuela and Ukraine, the risk of significant currency
devaluation is high.
Currency devaluations, the imposition of new exchange controls
or other similar restrictions on currency convertibility, or the
tightening of existing controls in the countries in which
ArcelorMittal operates could adversely affect its business,
financial condition, results of operations or
prospects
.
The Significant Shareholder could exercise significant
influence over the outcome of shareholder votes.
At December 31, 2024, HSBC Trustee (C.I.) Limited, as trustee
of a fully discretionary trust (referred to as the "Significant
Shareholder"),
beneficially
owned (within the meaning of Rule
13d-3 under the Securities Exchange Act of 1934, as amended)
ordinary shares amounting to
340,072,244
in the aggregate
(when aggregated with ordinary shares of ArcelorMittal held
directly by Mr. Lakshmi N. Mittal and Mrs. Usha Mittal),
representing
44.25%
of ArcelorMittal’s then outstanding shares.
As a result, the Significant Shareholder could exercise
significant influence over the decisions adopted at the
ArcelorMittal general meetings of shareholders, including
matters involving mergers or other business combinations, the
acquisition or disposition of assets, issuances of equity and
obtaining funding through debt. The Significant Shareholder
could also exercise significant influence over a change of control
of ArcelorMittal. Mr. Lakshmi N. Mittal and Mrs. Usha Mittal are
discretionary beneficiaries of the trust. For further information on
the Company’s major shareholders, see “Shareholders and
markets—Major shareholders”.
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VI. Legal and regulatory risks
The income tax liability of ArcelorMittal may substantially
increase if the tax laws and regulations in countries in
which it operates change or become subject to adverse
interpretations or inconsistent enforcement.
Taxes payable by companies in many of the countries in which
ArcelorMittal operates are substantial and include value-added
tax, excise duties, profit taxes, payroll-related taxes, property
taxes, mining taxes and other taxes. Tax laws and regulations in
some of these countries may be subject to frequent change,
varying interpretation and inconsistent enforcement. Ineffective
tax collection systems and national or local government budget
requirements may increase the likelihood of the imposition of
arbitrary or onerous taxes and penalties, which could have a
material adverse effect on ArcelorMittal’s financial condition and
results of operations. In addition to the usual tax burden
imposed on taxpayers, these conditions create uncertainty as to
the tax implications of various business decisions. This
uncertainty could expose ArcelorMittal to significant fines and
penalties and to enforcement measures despite its best efforts
at compliance, and could result in a greater than expected tax
burden. See note 10 to the consolidated financial statements.
It is possible that tax authorities in the countries in which
ArcelorMittal operates will introduce additional revenue raising
measures. The introduction of any such provisions or
modification of tax rates, tax laws, treaties in an adverse manner
may affect the overall tax efficiency of ArcelorMittal and may
result in significant additional taxes becoming payable and
adversely effect on the Company’s financial condition, results of
operations, cash flows, liquidity and ability to pay dividends.
ArcelorMittal is subject to economic policy, military,
political, social and legal risks and uncertainties in the
markets (including emerging ones) in which it operates or
proposes to operate, and these uncertainties may have a
material adverse effect on ArcelorMittal’s business,
financial condition, results of operations or prospects.
ArcelorMittal operates globally including in a large number of
emerging markets. Many of these countries have implemented
measures aimed at improving the business environment and
providing a stable platform for economic development.
ArcelorMittal’s business strategy has been developed partly on
the assumption that this modernization, restructuring and
upgrading of the business climate and physical infrastructure will
continue, but this cannot be guaranteed. In particular, certain of
these markets have experienced or are experiencing particularly
difficult operating conditions. Many emerging markets are also
at risk of economic crises (be it external debt, currency,
domestic corporate, household or public debt crises) usually
brought on by an economic or political shock which can
exacerbate existing domestic structural imbalances. For
example, crises in Argentina and Turkey have had negative
impacts on the Company's core markets in Brazil and the EU,
respectively. Any slowdown in the development of these
economies could have a material adverse effect on
ArcelorMittal’s business, financial condition, results of
operations or prospects, as could insufficient investment by
government agencies or the private sector in physical
infrastructure. For example, the failure of a country to develop
reliable electricity and natural gas supplies and networks, and
any resulting shortages or rationing, could lead to disruptions in
ArcelorMittal’s production.
Moreover, some of the countries in which ArcelorMittal operates
have been undergoing substantial political transformations from
centrally controlled command economies to market-oriented
systems or from authoritarian regimes to democratically elected
governments and vice-versa. Political, economic and legal
reforms necessary to complete such transformation may not
progress sufficiently. On occasion, ethnic, religious, historical
and other divisions have given rise to tensions and, in certain
cases, wide-scale civil disturbances and military conflict. The
political systems in these countries are vulnerable to their
populations’ dissatisfaction with their government, reforms or the
lack thereof, social and ethnic unrest and changes in
governmental policies. The prospect of further unrest and
resulting political or economic destabilization cannot be ruled
out. Furthermore, certain of ArcelorMittal’s operations are also
located in areas where acute drug-related violence (including
executions and kidnappings of non-gang civilians) occurs and
the largest drug cartels operate, such as the states of
Michoacán, Sinaloa and Sonora in Mexico.
Furthermore, ArcelorMittal’s operations in certain countries may
be affected by military conflicts, such as in Ukraine. Any of these
developments could have a material adverse effect on
ArcelorMittal’s business, financial condition, results of
operations or prospects and its ability to continue to do business
in these countries.
Moreover, the legal systems in some of the countries in which
ArcelorMittal operates remain less than fully developed,
particularly with respect to the independence of the judiciary,
property rights, the protection of foreign investment and
bankruptcy proceedings, generally resulting in a lower level of
legal certainty or security for foreign investment than in more
developed countries. ArcelorMittal may encounter difficulties in
enforcing court judgments or arbitral awards in some countries
in which it operates because, among other reasons, those
countries may not be parties to treaties that recognize the
mutual enforcement of court judgments. Assets in certain
countries where ArcelorMittal operates could also be at risk of
expropriation or nationalization. In addition, the Venezuelan
government has implemented a number of selective
nationalizations of companies operating in the country to date.
Although ArcelorMittal believes that the long-term growth
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potential in emerging markets is strong, and intends them to be
the focus of the majority of its near-term growth capital
expenditures, legal obstacles could have a material adverse
effect on the implementation of ArcelorMittal’s growth plans and
its operations in such countries.
ArcelorMittal is subject to an extensive, complex and
evolving regulatory framework which may expose it and its
subsidiaries, joint ventures and associates to
investigations by governmental authorities, litigation and
fines, in relation, among other things, to antitrust and
compliance matters. The resolution of such matters could
negatively affect the Company’s strategy, operations,
profitability and cash flows in a particular period or harm its
reputation.
ArcelorMittal’s business encompasses multiple jurisdictions and
complex regulatory frameworks, including in relation to antitrust,
and economic sanctions, anti-corruption and anti-money
laundering matters. Laws and regulations in these areas are
complex and constantly evolving and enforcement of them
continues to increase. ArcelorMittal may as a result become
subject to increasing limitations on its business activities and to
the risk of fines or other sanctions for non-compliance. From
time to time, the Company is subject to review by authorities
that monitor market power in any of the markets in which it
operates. To the extent that ArcelorMittal is deemed by relevant
authorities to exhibit significant market power, it can be subject
to various regulatory obligations and restrictions, such as
disposing of assets or granting access to its operations to third
parties or being prevented from completing acquisitions, which
could thereby adversely affect its results of operations and
profitability. As a result of its position in the steel industry and its
historical growth through acquisitions, ArcelorMittal could be
subject to governmental investigations and lawsuits by private
parties based on antitrust laws. These could require significant
expenditures and result in liabilities or governmental orders that
could have a material adverse effect on ArcelorMittal’s business,
operating results, financial condition and prospects. An adverse
ruling in such type of proceedings could subject ArcelorMittal to
substantial administrative penalties and/or civil damages. No
assurance can be given that the Company will not be identified
as having significant market power in any relevant markets in
the future and that it will not be subject to additional regulatory
requirements.
ArcelorMittal’s governance and compliance processes, which
include the review of internal controls over financial reporting as
well as a Code of Business Conduct and other rules and
protocols for the conduct of business, may not prevent breaches
of laws and regulations or internal policies relating to
compliance matters at ArcelorMittal or its subsidiaries, as well as
to instances of non-compliant behavior by its employees,
contractors or other
agents
. Any material weakness in internal
control over financial reporting (including
as
identified by the
Company as of December 31, 2023 see “Additional Information
—Management’s report on internal control over financial
reporting") could reduce confidence in the Company's published
information, impact access to capital markets or the trading
price of its
securities
. The risk of non-compliance is also present
at ArcelorMittal’s joint ventures and associates where
ArcelorMittal has a non-controlling stake and does not control
governance practices or accounting and reporting procedures.
Furthermore
, ArcelorMittal is subject to evolving laws,
regulations, policies, and international accords relating to
matters beyond its core operations, including environmental
sustainability, climate change, human capital, and employment
matters. Some of these have recently come under increasing
scrutiny. For example, in January 2025, President Trump signed
a number of Executive Orders focused on diversity, equity and
inclusion (“DEI”), which indicate continued scrutiny of DEI
initiatives and potential related investigations of certain private
entities with respect to DEI initiatives, including publicly traded
companies. If ArcelorMittal does not successfully manage
expectations across varied stakeholder interests, it could erode
stakeholder trust and impact its reputation. Such scrutiny could
also expose ArcelorMittal to the risk of litigation, investigations
and enforcement actions or challenges, including by U.S.
federal or state authorities, or result in reputational harm.
Unfavorable outcomes in current and potential future litigation
and investigations relating to antitrust and compliance matters
could reduce ArcelorMittal’s liquidity and negatively affect its
profitability, cash flows, results of operations and financial
condition, as well as harm its reputation.
U.S. investors may have difficulty enforcing civil liabilities
against ArcelorMittal and its directors and senior
management.
ArcelorMittal is incorporated under the laws of the Grand Duchy
of Luxembourg with its principal executive offices and corporate
headquarters in Luxembourg. The majority of ArcelorMittal’s
directors and senior management are residents of jurisdictions
outside of the United States. The majority of ArcelorMittal’s
assets and the assets of these persons are located outside the
United States. As a result, U.S. investors may find it difficult to
effect service of process within the United States upon
ArcelorMittal or these persons or to enforce outside the United
States judgments obtained against ArcelorMittal or these
persons in U.S. courts, including actions predicated upon the
civil liability provisions of the U.S. federal securities laws.
Likewise, it may also be difficult for an investor to enforce in
U.S. courts judgments obtained against ArcelorMittal or these
persons in courts in jurisdictions outside the United States,
including actions predicated upon the civil liability provisions of
the U.S. federal securities laws. It may also be difficult for a U.S.
investor to bring an original action in a Luxembourg court
predicated upon the civil liability provisions of the U.S. federal
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securities laws against ArcelorMittal’s directors and senior
management and non-U.S. experts named in this annual report.
Risk management process
Management is responsible for internal control in the Company
and has implemented on an ongoing basis a robust short,
medium and long-term risk – including ESG-related risks –
management and control system, which is designed to ensure
its business is focused on achieving its objectives and that
significant risks are identified and mitigated. The system is also
designed to ensure compliance with relevant laws and
regulations.
The Company’s risk management and internal control system is
designed to determine risks in relation to the achievement of
business objectives and appropriate risk responses. The
establishment and maintenance of a risk identification and
management process is the responsibility of site/segment/
corporate function management. Risks are owned and
monitored by management. Risk officers designated by
management facilitate the conversations and help monitoring
the action plans. Critical risks are escalated through existing
reporting lines. Critical risk decisions are not dissociated from
the other decisions. Risks are analyzed by building models and
developing scenarios to understand potential financial impacts.
Short-term risks (within a 12-month time frame) are identified
through a bottom-up process by respective management teams.
Risks are identified through a defined process by respective
management teams. Business segments and corporate
functions consolidate the identified risks and report the top ones
as part of the periodic reporting to key internal stakeholders.
The Company uses a risk management framework based on a
blend of a
COSO
(the Committee of Sponsoring Organizations
of the Treadway Commission) 2013, ISO 31000 and an in-house
model. Sites assess risks, including ESG and climate related
risks, by assigning them a probability of occurrence, potential
financial impact and/or non-financial consequences. Global
trends, and the risks and opportunities identified as arising from
them, are used to inform the Company’s strategic outlook and
planning.
Based on management reviews, reviews of the design and
implementation of the Company’s risk management approach
and business and functional risk committees, management
provides an assessment each year, as required by law, of the
effectiveness of the Company’s risk management process.
It should be noted, however, that the above does not imply that
these systems and procedures provide certainty as to the
realization of operational and financial business objectives, nor
can they prevent all misstatements, inaccuracies, errors, fraud
and non-compliance with rules and regulations.
The Audit & Risk Committee assists the Board of Directors with
the oversight of risks to which the ArcelorMittal group is exposed
and in the monitoring and review of the risk-management
framework and process.
The Global Assurance Department facilitates the risk
management process and provides support enabling business
as well as corporate functions to identify these risks and
opportunities to the business based on social, environmental,
regulatory, workforce, stakeholder, resource, technological and
other trends, and specify mitigation actions. A consolidated
report is shared on a half-yearly basis with the key stakeholders.
With respect to climate, the work is coordinated by
ArcelorMittal’s executive officer for corporate business
optimization in consultation with segment CEOs; discussed on a
regular basis by the Group Management Committee; and
overseen by the Executive Office, which provides leadership
and guidance.
The Company’s climate strategy financial risks
are brought to the attention of the Group Management
Committee and where financially significant at a group level, are
addressed at the Corporate Finance and Tax Committee
.
Central to the Company's approach is its work to advocate for
policy support strategy to ensure that ArcelorMittal can respond
to rising carbon prices with viable investments in
decarbonization technologies. At the same time, all of
ArcelorMittal's business segments are required to prepare
carbon emission reduction plans to reach net zero by 2050 as
part of the annual planning cycle.
With respect to security, the Company has put in place means to
ensure the security of its people, assets and intellectual property
by supporting business units on security governance, security
risk management, operational security, strategy and continuous
improvement. It develops and promotes security policies,
procedures, tools and processes to support security process
owners with identifying and assessing security risks, related to
people, assets and intellectual property. It also identifies gaps,
and implements appropriate leading practice security controls to
promote more secure and resilient business environments.
As
regards
risks relating to the security of information systems,
ArcelorMittal has developed governance and security rules
which describe the recommended organization, infrastructure
and operating procedures. These provisions are applied across
the Company under the responsibility of the business segments.
The Group Chief Information Security Office defines cyber
security policies available and applicable for all segments/units
globally and develops general directives in cyber security
reflecting mission, goals and values of ArcelorMittal. The cyber
security policy focuses on protecting information systems
against disclosure to unauthorized users (confidentiality),
improper modification (integrity) and non-access when required
(availability). In addition, cyber maturity assessments are
performed annually in many business units and supplemented
by in-depth cyber audits and penetration testing exercises
performed by Global Assurance. For more detailed information
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regarding the Company's cybersecurity risk management and
strategy, see "Cybersecurity" below.
Regarding risks relating to changes in the regulatory
environment and business ethics, the Legal, Compliance &
Company Secretary Department ("LCCSD") reporting to the
Chief Financial Officer establishes the Company's legal policy. It
provides effective advice to assist in identification and
monitoring of legal, regulatory and governance risks. The
LCCSD is supported by regional and segment general counsels
located across the business, who are further supported by unit
or country general counsels. The Compliance structure is
headed by Group Compliance and the Data Protection Officer
who report to the Group General Counsel. The Group
Compliance and Data Protection Officer is supported by a
Corporate Compliance team and a Group-wide compliance
network.
Internal control procedures
ArcelorMittal's internal control framework is based on the
COSO
2013. It includes the following five components: control
environment, risk assessment, control activity, information and
communication and monitoring activities.
ArcelorMittal's internal controls aim to provide reasonable
assurance but not absolute assurance because of the inherent
limitations around effectiveness and efficiency of business
operations, reliability of financial information, compliance with
laws and regulations and compliance with policies and
procedures. The organization of ArcelorMittal's internal control is
aligned with group organization following which corporate
functions, business segments and operational entities are
directly accountable for establishing and maintaining effective
and adequate internal controls and procedures that conform to
the regulatory framework. The principles of control fit into the
framework of the rules of corporate governance. In particular,
these rules task the Audit & Risk Committee with monitoring the
effectiveness of the internal control and risk management
systems and of the internal audit, particularly as regards the
procedures for preparing and dealing with accounting, financial
and non-financial reporting.
Control environment
ArcelorMittal's control environment is primarily based on its
Code of Business Conduct and supported by a comprehensive
framework of policies and procedures in areas such as
human
rights,
anti-corruption and insider dealing
. These documents
reflect the principles and concepts of the UN Global Compact,
the OECD Guidelines on Multinational Enterprises and UN
Sustainable Development Goal 16: peace, justice and strong
institutions. The Company’s Code of Business Conduct defines
what acting with integrity means in practice. It applies to all
directors, officers and employees of ArcelorMittal worldwide. To
maintain knowledge about the Code of Business Conduct and
other aspects of compliance, employees take part in training
programs based on a matrix system covering economic
sanctions, prevention of corruption, insider dealing regulation,
fraud awareness and prevention, anti-trust issues, human rights,
data protection and the Code of Business Conduct every three
years.
The Board of Directors, with the support of its Committees,
ensures that internal control functions operate properly. The
Audit & Risk Committee monitors the effectiveness of internal
control and risk management systems implemented by the
Board of Directors and management. As part of its role to foster
open communication, the Audit & Risk Committee meets at least
annually with management, the head of Global Assurance and
the Company’s independent accountants in separate executive
sessions to discuss any matters that the Audit & Risk Committee
or each of these persons believe should be discussed privately.
Management's responsibility is to ensure that the organizational
structure plans, executes, controls and periodically assesses the
Company's activities. It regularly reviews the relevance of the
organizational structures so as to be in a position to adapt them
swiftly to changes in the activities and in the environment in
which they are carried out. The business segments' and
operational entities' management are responsible for the internal
control and risk management system within their scope of
responsibility.
ArcelorMittal has defined responsibilities that cover the three
dimensions of internal control: operational management, which
is responsible for implementing internal control, support
functions such as Finance, Legal,
Treasury or Human
Resources, Health & Safety and Sustainability & Environment
which prescribe the internal control systems, verify their
implementation and effectiveness and assist operational
employees, and Global Assurance who, through their audit
reports, provide recommendations to improve the effectiveness
of the systems.
Following a risk-based approach, business processes and/ or
management systems may be the subject of an internal audit
performed by the Global Assurance Department reporting to
both the Audit & Risk Committee Chair and the Group Executive
Chairman in accordance with the international framework of the
internal audit and its Code of Ethics. The audit plan, which is
risk based, is submitted annually to the Audit & Risk Committee.
The Global Assurance department presents its results to the
management of operational entities and business segments and
reports to the Audit & Risk Committee, Executive Office and
Group CFO.
The design and effectiveness of the key operational, financial
and information technology controls related to internal control
over financial reporting, are regularly examined and assessed in
compliance with the Sarbanes-Oxley Act.
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Cybersecurity
The Group Chief Information Security Officer and Head of Cyber
Strategy (“CISO”) follows the Group risk management program
as defined by the Global Assurance team in the management of
risks relating to the security of information systems. For further
information on the Global Assurance team, see “Corporate
governance—Sustainability committee—Global Assurance”.
The
Group
CISO
is an experienced information technology and
operation technology
executive
. He is a leading international
chief information officer with
proven expertise in cyber security,
digital transformation, IT integration and business enablement
.
He joined ArcelorMittal in 2024 from a
leading transportation /
logistics company where he served as their IT senior vice
president and international CIO from 2017
.
He holds an MBA in
international management from the Thunderbird School of
Global Management,
Glendale
, Arizona, USA, and a Bachelor of
Engineering in electronics and communication from the National
Institute of Technology, Trichy, India.
risk report to the Group Finance Risk Committee, headed by the
Group CFO, based on risks identified at the segment level,
which in turn reports to and assists the Board of Directors in
fulfilling its oversight responsibilities with respect to legal and
in the report are considered potential risks that may affect all
functions and departments across the Group. The office of the
CISO has identified the following four key risk areas:
1.
Large-scale cyber-attacks or malware causing
economic damage and/or reputational harm to
ArcelorMittal.
2.
Dependency risks and increased vulnerability to
outages of critical systems (applications or
infrastructure) causing significant disruption to
ArcelorMittal.
3.
Adverse consequences of technological advances
such as Artificial Intelligence (“AI”), cloud-based
programs or systems, Internet of Things (“IoT”) and
Blockchain, which may cause harm to ArcelorMittal.
4.
Wrongful exploitation of personal information causing
regulatory liabilities (e.g., GDPR or similar laws) or of
business data causing contractual or other legal
liabilities (e.g., relating to IP, R&D or customers) that
would have significant negative impacts on
ArcelorMittal.
As part of the risk management process, the Group’s local IT
teams, segment CIOs and segment CISOs also identify local
cyber risks and report to
the Group Finance Risk Committee.
The office of the CISO defines policies and procedures related
to cyber and information security as well as to permissible and
secure uses of cloud, operational technology (“OT”) and IoT
within the Company. ArcelorMittal follows the National Institute
of Standards and Technology Cybersecurity Framework ("NIST
CSF"). The Group’s cybersecurity policies focus on protecting
information systems against disclosure to unauthorized users
(confidentiality), improper modification (integrity) and non-
access when required (availability). These polices are
implemented across the Group and tracked and reported on a
quarterly basis. Additionally, the Company has in place a global
incident and crisis process with special procedures for
ransomware and data privacy (e.g., to increase protection and
address breaches). Most Group entities undergo periodic
security penetration testing exercises led by the Group CIO/
CISO team or external third parties throughout the year. Global
Assurance as part of risk based approach also conducts
penetration tests independently.
the implementation and operationalization of its cybersecurity
policies, cyber defense strategies and general cyber risk
management, including specialist assessors, security
consultants, IT auditors, forensic analysts, malware analysts
that handle Company data or otherwise have access to
ArcelorMittal’s network and systems are required to complete a
rigorous risk assessment program in an online platform, which
includes checks for data and cloud security, access, incident
reporting and physical protection in accordance with the NIST
CSF as well as applicable Company cybersecurity policies.
In addition, Cyber Maturity Assessments are performed annually
by an external consultant across many entities and segments for
both IT and OT. Assessments are evidence-based exercises
focusing on many key cyber processes, such as Vulnerability
and Incident Management, Patching and Change Management,
Malware Protection, Network Monitoring, Business Continuity
and Disaster Recovery, and Software Security. Additionally,
Global Assurance, as part of its risk based approach, performs
cyber audits and penetration tests (as part of the annual plan).
ArcelorMittal has been a long-standing customer of the BitSight
rating service and has defined specific target levels and KPIs for
cybersecurity in the BitSight platform. These risk measures are
monitored daily and reported quarterly to the Data Protection
Committee, led by the Group Data Protection Officer with
representation from Group Compliance, Group HR and the
Group CISO. BitSight also reports ArcelorMittal’s risk profile to
Glass-Lewis for purposes of investor reporting.
The office of the CISO has put in place an extensive online
dashboard that tracks various metrics related to cybersecurity
risks across various operating units. Such measures include:
1.
BitSight External Cyber Ratings and Risk Factors
2.
AntiMalware compliance levels
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3.
Active Directory security posture
4.
Cloud Security cyber score and framework adoption
5.
Ransomware Exploitable Vulnerability remediation
status
6.
Externally Facing Web Application Vulnerability levels
7.
Cyber Awareness Education and Training
8.
OS Level and Patching posture
9.
Mobile security compliance
10.
Security Baselines (IT and OT) quarterly assessments
11.
Expired user account risk
12.
Cyber attack simulation effectiveness
Cybersecurity Related Events in 2024
In 2024, ArcelorMittal did not experience any cyber-attacks,
cybersecurity threats or other information security incidents that
materially affected or were reasonably likely to materially affect
the Company’s business strategy, results of operations or
financial condition.
See
"Risk factors and control—
ArcelorMittal’s reputation and business could be materially
harmed as a result of data breaches, data theft, unauthorized
access or successful hacking”.
Governance
ArcelorMittal has implemented a distributed organizational
model.
At the Group level, the
Group CISO
defines the global
cybersecurity strategy and roadmap.
the ArcelorMittal Security Incident Classification and Escalation
Procedures as well as the ArcelorMittal Cyber Crisis
Management Procedures (collectively, the “Cybersecurity
Procedures”).
The Cybersecurity Procedures define the core
principles of security risk management and the procedures for
security management, including the roles and responsibilities of
key personnel, strategy and measures to cope with information
security breaches and related communication procedures.
Every cybersecurity occurrence or threat that rises to a specific
level defined in the Cybersecurity Procedures is reviewed in the
various security councils set out below and communicated to the
appropriate committees as defined in the Cybersecurity
Procedures. Any such cyber incident is promptly reported by the
Group CISO to (a) the Global Ransomware Crisis Committee
and (b) the Group CFO and Disclosure Committee for decision-
making regarding external communication to regulators or
cyber risks and incidents via the
Audit & Risk Committee
and
approves proposals or modifications to the Cybersecurity
Procedures.
The Audit & Risk Committee relies on information
provided from Global Assurance
, to which the Group CFO
provides information about risks.
The Group CFO provides
information to both the Audit & Risk Committee and the Group
CEO.
Group CISO:
•
the Group Chief Information Officer (“CIO”) Council
(headed by the Group CISO and made up of segment
CIOs and other specialists) leads and manages the
different business segments, which are responsible for the
implementation and management of security controls,
processes and technology within their respective business
segments.
•
the Group Cybersecurity (“CS”) Leadership team led by
the Group CISO and consisting of security officers from
each segment, is responsible for decision-making relating
to all security topics, defining roadmaps and execution of
strategies and protection within their respective segments.
•
the Global Ransomware Crisis Committee made up of
various heads of leadership functions such as Legal, IT,
Treasury, Communication, Investor Relations and Global
Assurance, with the assistance of a third-party service
provider acting as the Company’s ransomware negotiator
and advising partner, is responsible for advancing and
implementing the decision-making processes in the event
of a ransomware outbreak across the Company and any
demands for ransom payments.
•
the Data Protection Committee consisting of Group
Compliance, Group HR and Group CISO, and led by the
Group’s Data Privacy Officer, meets quarterly to review
any incidents or risks involving data privacy matters, and
its recommended actions are implemented across the
Group.
•
the Cyber Expert Committee (“EC”) led by the CISO and
made up of various subject matter experts and segment
security officers, works as a centralized team to address
common global issues and risks, recommend technologies
and risk solutions across the Group and prepare technical
security proposals to be reviewed by CS Leadership and
approved and adopted by the CIO Council.
•
the IT Security Council and OT Security Council operating
across the Group and comprising security leads from each
segment for their respective areas (IT or OT), as well as
from Global Assurance are used for purposes of
information sharing, feedback sessions for the CS
Leadership Group and sounding boards for new proposals
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BUSINESS OVERVIEW
Business strategy
ArcelorMittal’s success is built on its core values of safety,
sustainability, quality and leadership and the entrepreneurial
boldness that has empowered its emergence as the first truly
global steel and mining company. Acknowledging that a
combination of structural issues and macroeconomic conditions
will continue to challenge returns in its sector, the Company has
adapted its footprint to the new demand realities, intensified its
efforts to control costs and repositioned its operations to
outperform its competitors. The Company also continues to
develop and implement plans aimed at decarbonizing its steel
and mining assets in a competitive manner and achieving
carbon neutrality by 2050.
Against this backdrop, ArcelorMittal's strategy is to leverage four
distinctive attributes in aiming to capture leading positions in the
most attractive areas of the steel industry value chain, from
mining at one end to distribution and first-stage processing at
the other:
•
Global scale and scope
•
Unmatched technical capabilities
•
Diverse portfolio of steel and related businesses,
particularly mining
•
Financial capability
Three themes
Steel.
ArcelorMittal looks to expand its leadership role in
attractive markets and segments by leveraging the Company’s
technical capabilities and its global scale and scope. These are
critical differentiators for sophisticated customers that value the
distinctive technical and service capabilities the Company offers.
Such customers are typically found in the automotive, energy,
infrastructure and a number of smaller markets where
ArcelorMittal is a market leader. In addition, the Company is
present in, and will further develop, attractive steel businesses
that benefit from favorable market structures or geographies. In
developing attractive steel businesses, ArcelorMittal’s goal is to
be the supplier of choice by anticipating customers’
requirements and exceeding their expectations. It will invest to
develop and grow these businesses and enhance its ability to
serve its customers. Given the volatile nature of the industry,
these investments will be highly disciplined, leveraging
advanced project management capabilities, balancing financial
and sustainable considerations with targeted strategic
opportunities. Commodity steel markets will inevitably remain an
important part of ArcelorMittal’s steel portfolio. Here, a lean cost
structure should limit the downside in weak markets while
allowing the Company to capture the upside in strong markets.
Finally, ArcelorMittal is developing a strategic response to the
challenges and opportunities posed by decarbonization, which it
believes will fundamentally change the market structure of the
steel industry.
Mining.
ArcelorMittal is working to continue to create value from
its world-class mining business. Mining forms part of the steel
value chain but typically enjoys a number of structural
advantages, such as a steeper cost curve. The Company's
strategy is to create value from its most significant assets,
through selective expansion and de-bottlenecking, by controlling
cost and capital expenditure, and by supplying products that are
highly valued by steel producers. ArcelorMittal's financial
capability has allowed it to continue to invest in key mining
assets (in particular AMMC as well as ArcelorMittal Liberia and
Serra Azul), while the diversity of its steel and mining portfolio
facilitates the ability of the mining business to optimize the value
of its products in the steelmaking process. The Company's
mining business aspires to be the supplier of choice for a
balanced mix of both internal and external customers, while at
the same time providing a natural hedge against market volatility
for its steel operations. The mining business should also support
the decarbonization of the steel footprint through optimization of
mining product mix by supplying raw materials needed for the
low emissions footprints.
All operations.
ArcelorMittal strives to achieve best-in-class
competitiveness. Operational excellence, including health and
safety, the number one priority, is at the core of the Company's
strategy in both steel and mining. The Company steadily
optimizes its asset base to ensure it is achieving high operating
rates with its best assets. Its technical capabilities and the
diversity of its portfolio of businesses underpin a strong
commitment to institutional learning and continuous
improvement through measures such as benchmarking and
best-practice sharing. Innovation in products and processes also
plays an important role while supporting overall
competitiveness. In addition, ArcelorMittal continues to optimize
its decarbonization pathway to ensure that the Company
remains competitive and achieves an appropriate return on the
required
investment.
Five key strategic enablers
Critical to implementing this strategy are five key enablers:
A clear license to operate.
Many of ArcelorMittal's businesses
are located in regions that are in the early stages of economic
development. Practically all are resource-intensive. The
Company recognizes that it has an obligation to act responsibly
towards all stakeholders. ArcelorMittal's commitment to
sustainability and safety
is outlined below. See
"Business
overview—Sustainable development"
.
Sustainability and safety
are core values that underline ArcelorMittal's efforts to be both
the world’s safest steel and mining company and a responsible
environmental steward.
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A strong balance sheet.
The Company maintains a strong
balance sheet with credit metrics
consistent with investment
grade credit rating
. This provides a strong foundation for its
balanced capital allocation: to invest in organic growth,
consistently reward shareholders, and maintain the flexibility, on
a selective basis, to pursue acquisitive growth opportunities.
A decentralized organizational structure.
ArcelorMittal's scale
and scope are defining characteristics that give it a competitive
advantage. They also introduce complexity and the risks of
inefficiency, bureaucracy and diffuse accountability. To manage
these risks, the Company favors a structure in which the
responsibility for profit and loss is focused on business units
aligned with markets.
Active portfolio management.
Throughout the Company's
history, it has sought to grow and strengthen the business
through acquisitions. That remains the case. The acquisition of
existing assets and businesses is typically seen as a more
attractive growth path than greenfield investment. The Company
is, however, also willing to dispose of businesses that cannot
meet its performance standards or that have more value to
others.
The best talent.
ArcelorMittal's success will depend on the
quality of its people, and its ability to engage, motivate and
reward them. As detailed below, the Company is committed to
investing in its people and ensuring a strong leadership pipeline.
See "Management and Employees—Employees—Employee
development". It will continue to improve its processes to attract,
develop and retain the best talent.
Research and development
The Company’s Global Research and Development ("R&D" or
"Global R&D") division provides the technical foundation for the
sustainability and commercial success of the Company by
stimulating innovative thinking and the continuous improvement
of products and processes.
The Company operates 14 research sites in 9 countries around
the world. In 2024, ArcelorMittal’s R&D expense was $285
million (compared to $299 million and $286 million in 2023 and
2022, respectively). In addition, the Company capitalized $29
million of research and development expenses in 2024
(compared to $26 million in 2023).
In 2024, R&D launched 20 new products and solutions to
accelerate sustainable lifestyles, and 26 products and solutions
to support sustainable construction, infrastructure and energy
generation.
Among its R&D initiatives, in 2024, the Company undertook a
total of
145
Life Cycle Assessment ("LCA") studies related to
steel products and the processes used to produce them, all
guided by the relevant standards.
For Automotive segment,
ArcelorMittal continuously develops its
S-in motion® steel solution range, which helps in optimizing
passive safety, production costs, and
the carbon footprint of the
Company's solutions.
AHSS products are among the most
affordable solutions on the market for both passengers and
battery protection.
In 2024, new grades of steel were marketed,
particularly under the MartInsite® brand. Due to their anti-
intrusion performance and fatigue resistance, these grades are
particularly well-suited in terms of automotive safety standards
which require high impact resistance.
ArcelorMittal Multi Part Integration® (MPI) concept was
developed to simplify the vehicle manufacturing process. The
Company launched several new projects in 2024 for OEMs,
after the initial success of MPI Door-Ring concepts in the U.S.
and China with both legacy and newcomer OEMs. In 2024, the
Company launched a global advertisement campaign to
promote MPI "The Power of Less".
The Company aims to deliver similar breakthrough advances in
other sectors by creating differentiated products and unique
engineering solutions. ArcelorMittal is fully involved in the
development of solutions dedicated to the Global Energy
Transition. The Company has developed and patented
advanced steels for use in the renewable energy segment.
Notably, Magnelis® long lasting coating combined with Hyper®
high strength steels have become a material of choice for light
weight solar mounting systems. In 2024, new lines started
production in India (AMNS India) and Brazil (ArcelorMittal Vega
Do Sul). Additionally, the Company is working on the
development of solutions suitable for the hydrogen economy,
electricity grids, carbon capture, storage & use and bioenergy.
Hymatch® steel offer was developed to provide steel grades
suitable for H2-linepipes.
The production of a complete range of low-CO
2
steels allows for
a reduction in carbon footprint by up to 65%. More than 50 new
XCarb® Recycled and Renewably Produced ("RRP") products
have been commercialized in 2024 and more than 200 other
new products are under development.
XCarb
®
RRP steels (flat, long, tubular, profiles, sandwich
panels) have been incorporated in Steligence
®
building
concepts. Steligence
®
is the holistic platform for environmentally
friendly and cost-effective steel solutions for circular use (design
for re-use), resilience with respect to exceptional events (floods
and storms), as well as solutions for thermal retrofit or solar
energy harvesting.
In process research, the focus remains on innovations in the
following domains:
By-products and circular economy.
In 2024, the Company
characterized the production of new steel routes by-products
under different operational conditions to foresee the qualities
and quantities of the new by-products mix. In 2024, LCA was
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calculated to
com
pare the use of slag to replace other materials.
As an example, Sidercal® is a slag-based steel by-product used
in roads construction in the sub-base and as pavement.
Other circular economy initiatives include working on the use of
mining tailings as a secondary raw material, either by finding
marketable solutions or generating valuable products to be used
in-house and in construction.
Progress against air pollution
.
In 2024, information of all studies
and real data monitoring were analyzed, concluding that control
measures implemented in the yards in Tubarão have been
effective in reducing dust emissions.
ArcelorMittal also has research activities focused on innovative
gas cleaning technologies (Nitrogen Oxides (“NOx”)
, Sulphur
Oxides ("SOx")
). In 2024, R&D tests proved significant NOx
emissions reduction (up to 50%) at a semi-industrial scale.
Progress in water management.
ArcelorMittal is investigating
solutions to reduce water vulnerability in some areas. In 2024,
R&D initiated a
smart pilot plant in Tubarão (Brazil) to monitor
basic water quality parameters with
a collection of sensors
powered by solar energy. This pilot plant delivered promising
results during the test phase during the year.
R&D continues supporting ArcelorMittal’s three decarbonization
paths for primary activities:
The Company's ongoing Volteron™
project is utilizing low temperature iron electrolysis, a first of its
kind industrial scale pilot (which is running according to
schedule).
In 2024, the Company identified blast furnace decarbonization
technologies including top gas recycling and potential CO
2
storage to reach the expected CO
2
decrease. The testing and
evaluation with actual BF gases of some carbon capture
technologies have been completed at pilot level.
In 2024, advanced models to optimize the energy efficiency of
the reheating furnaces were industrialized, reducing energy
consumption by 5-10% per furnace.
Overall, 23 furnaces at 19
different plants are already equipped with this model.
Process research and development for Products differentiation:
In electrical steels, R&D contributed to the strong progress in
reliability and quality at the Company's Saint-Chély (France)
electrical steel plant while supporting the new investment in
Mardyck (France) Calvert (U.S.).
Mining Process Improvement:
To assist with the decarbonization
of the Group, the Mining segment and Global R&D are investing
significantly in the decarbonization of pellets production. By
reducing the temperature of pellets curing and changing the
specific binders used for the balling, and therefore modifying the
pelletizing process, CO
2
emissions from the mining business will
be reduced.
In addition, Global R&D is de-risking all ArcelorMittal tailings
facilities worldwide with the development of its own surveillance
platform to monitor in real time the conditions and the impact on
planned activities regarding safety.
In the digital area, ArcelorMittal invested early and significantly
in automation systems, and for decades the Company has been
a pioneer in the introduction and use of artificial neural
networks. ArcelorMittal is currently fully committed to a total
digital transformation and is progressively becoming a data-
driven company.
In 2024, in addition to various internal awards, Global R&D
received an important external recognition in the AI domain from
International Data Corporation – Future Enterprises Award
(Future of Operations) in North America due to an internally
developed AI solution which maximizes throughput at AMNS
Calvert's slab yard. The plant sustainably manages the targeted
increased volumes as slab yard is no longer a bottleneck. This
award comes as a close collaboration with AM Calvert's
operations.
In 2024, the Company has continued with significant advances
aligned with its digital plan and strategy, including the following
highlights:
•
ArcelorMittal patented new AI algorithms and their
applications.
•
The Company's significantly mature AI-based product
development platform allows speeding up the development
of certain families of products and providing solutions to
develop new products.
•
Internally developed AI algorithms show specific results in
predictive maintenance of different types of critical
equipment. Global deployment is progressively being
realized.
•
More traditional and globally deployed advanced process
models are being reworked incorporating new AI
algorithms.
•
Several of the Company's expansion plans are thoroughly
modelled in advance combining AI and mathematical
optimization techniques to a very high level of sophistication
allowing to have very accurate representation of the new
investment under many different business scenarios.
•
AI-based Production Scheduling optimization continues to
remain a primary focus.
R&D developed in-house solutions
that have outperformed solutions available in the market.
While the implementation of large-scale digital and industry 4.0
projects is challenging in a company of ArcelorMittal’s size, once
implemented these projects bring major benefits and value
because of the Company’s scale and global footprint.
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Management report
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Sustainable development
Sustainability governance
The Company’s governance structure relating to sustainability is
based around the following supervisory bodies:
The three Board of Directors Committees
:
Audit and Risk
Committee; Appointments, Remuneration and Corporate
Governance Committee ("ARCG Committee") and the
Sustainability Committee.
Management Committees and Panels
: Management Committee,
Corporate Finance and Tax Committee ("CFTC"), Investment
Allocation Committee ("IAC"), Health and Safety
Council
,
Climate Change Panel, Sustainable Development Panel, and
Equality Panel.
The Board of Directors Committees
For a comprehensive description of the structure and
responsibilities of the Audit and Risk Committee, ARCG
Committee and the Sustainability Committee, please refer to
"Management and employees—Corporate governance—Board
of Directors committees".
Management Committees and Panels
Management Committee
The Management Committee comprises senior managers with
responsibility for various business divisions and functions in
ArcelorMittal. For more information see
ArcelorMittal's
Internet
site at www.arcelormittal.com.
Corporate Finance and Tax Committee ("CFTC")
The CFTC defines the principles for the ArcelorMittal finance
community and presents and supports financial and business
solutions for the ArcelorMittal Group by providing the expertise,
excellence in execution and stability for continuous, sustainable
and competitive development of the Group while developing and
promoting its people. The responsibilities of the CFTC extend
across all finance and tax activities in the Group and are not
limited to corporate level activities only. The CFTC is chaired by
the CFO and Executive Vice President, Mr. Genuino Christino,
and has main responsibilities covering treasury, funding,
taxation, accounting and performance management, SOX and
insurance.
Investment Allocations Committee ("IAC")
The IAC is chaired by Mr. Aditya Mittal, CEO of ArcelorMittal.
The IAC authorizes large capital expenditure projects, including
those designed to deliver safety and environmental
improvements, carbon reductions, and reviews the carbon
footprint impact of all proposals. Committee members include
the CFO and Executive Vice President, Mr. Genuino Christino;
Head of Corporate Business Optimization and Executive Vice
President, Mr. Brad Davey (Vice Chairman of IAC), Chief
Technology Officer ("CTO") and Vice President, Mr. Pinakin
Chaubal; and Head of Corporate Strategy and Vice President,
Mr. David Clarke.
Health and Safety Council
See below under Health and Safety section.
Climate Change Panel ("CCP")
The CCP discusses and coordinates ArcelorMittal’s approach
and response to climate change. The CCP is chaired by Mrs.
Nicola Davidson, Vice President, Head of Communications and
Sustainable Development, and a member of the Group
Management Committee. The panel consists of senior
managers from relevant corporate functions and key operations
across the Group. It guides engagement and advocacy with
external stakeholders on climate change and decarbonization
and supports the business in understanding the risks and
opportunities associated with the transition to a low carbon
economy. The CCP meets on a nominally quarterly basis. Key
issues identified by the CCP are raised with the Executive Office
and recommended topics are brought forward for discussion
and action with the Group Management Committee.
Sustainable Development Panel ("SDP")
The purpose of the SDP is to discuss and coordinate the
Company's approach to environmental and social issues. It
consists of senior managers from relevant corporate functions
and key operations across the Group. It guides engagement on
issues relating to material environmental and social issues,
stakeholder engagement, compliance and performance on
environmental (non-climate), human rights and social
performance issues. The SDP meets on a nominally quarterly
basis. The Panel is chaired by Mr. James Streater, General
Manager, Sustainable Development.
Sustainability outcomes
ArcelorMittal’s 10 Sustainability Development (SD) outcomes
articulate the priorities the Company believes it needs to pursue
if it is to bring optimal long-term value to all its stakeholders and
drive its transformation into the steel company of the future.
They are aligned with the 17 United Nations Sustainable
Development Goals ("SDGs"), widely regarded as the
benchmark in global sustainability policy and action.
|
ArcelorMittal's 10 SD Outcomes
|
|
|
1
|
Safe, healthy, quality working lives for ArcelorMittal’s people
|
|
2
|
Products that accelerate more sustainable lifestyles
|
|
3
|
Products that create sustainable infrastructure
|
|
4
|
Efficient use of resources and high recycling rates
|
|
5
|
Trusted user of air, land and water
|
|
6
|
Responsible energy user that helps create a lower-carbon future
|
|
7
|
Supply chains that ArcelorMittal’s customers trust
|
|
8
|
Active and welcomed member of the community
|
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Management report
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|
9
|
A pipeline of talented scientists and engineers for tomorrow
|
|
10
|
ArcelorMittal’s contribution to society measured, shared and valued
|
Materiality
The starting point for the Company’s sustainability reporting and
planning is to assess the issues that are most material in their
impacts for external and internal stakeholders, against the
issues seen by the Company as having the most actual or
potential impact on its business and value. Further, the
Company also assesses material topics
from a financial
perspective. This allows the Company to identify priority issues
to address and those that are increasing or decreasing in
importance. It provides the basis for the Company's
sustainability planning and programs including investment
decisions, and serves as a benchmark to assess progress.
The Company's most material topics are:
•
Safety
•
Climate
•
People (including equal opportunities and non-
discrimination)
•
Air, water, land, biodiversity and ecosystems
•
Communities
•
Value chains that the Company's stakeholders trust
•
Business conduct
Reporting
The Company is committed to reporting on its governance,
strategy, risks and performance relating to each of its material
issues in its key publications i
ncluding Annual reports, Climate
Action Reports and Sustainability Report.
In 2024, the Company has continued to assess the resilience of
the business against different transition and physical climate
scenarios and consider the relevant financial implications to
inform its strategy and manage its risk exposure.
In 2024, alongside making disclosures to the Carbon Disclosure
Project ("CDP") on climate change and water, and
conducting
numerous customer surveys and investor engagement
, the
Company published several country-specific sustainability
reports as required by its subsidiaries operating in various
jurisdictions.
The Company periodically publishes the results of its
engagements through its climate advocacy and policy alignment
reports on ArcelorMittal’s website.
The Company also released its Report on Payments to
Governments in Respect of Extractive Activities for the year
ended December 31, 2023.
The Company publishes a special disclosure report in
compliance with the US Dodd Frank Act Section 1502 and has
been working to meet the requirements of the EU's conflict
minerals regulation.
Health
and Safety
ArcelorMittal’s operations are subject to a broad range of laws
and regulations relating to the protection of human Health and
Safety ("H&S"). As these laws and regulations in the United
States, the EU and other jurisdictions continue to become more
stringent, ArcelorMittal expects to expend substantial amounts
to achieve or maintain compliance. ArcelorMittal has established
H&S guidelines requiring each of its business units and sites to
comply with all applicable laws and regulations. Compliance
with such laws and regulations and monitoring changes to them
are addressed primarily at the business unit level, checks are
made through a 3-line of assurance model. ArcelorMittal has a
clear and strong H&S Management System, that includes
specific policy, standards and life-saving golden rules, aimed at
reducing on a continuing basis the severity and frequency of
accidents; through its Group H&S Council ("GHSC"), the
Company reinforces the penetration of the safety culture in the
Company. The effective policy outlines the commitment
ArcelorMittal has made to the H&S of all employees and
reinforces the accountability of the local management and
encourages the continuous improvement in H&S performance at
unit level, which permits the GHSC to define and track
performance targets and monitor results from every business
unit and site.
Safety governance
ArcelorMittal business units CEOs are accountable for the
segment/unit H&S performance. Business unit CEOs and local
safety departments integrate safety into the business strategy,
manage and implement the Group's best practice procedures
and standards at the local level. Further, ArcelorMittal business
units solicit external expertise and resources in closing any gaps
in improving the safety performance.
The Head of Corporate H&S, who is also a member of the
Group Management Committee, reports to the Executive Vice
President, Head of Corporate Business Optimization, who in
turn reports to the CEO of ArcelorMittal. The corporate H&S
team develops, maintains and promotes the Group H&S
strategy, management system and defines and tracks safety
KPIs, monitoring results from every business unit and site.
ArcelorMittal has an established Group H&S policy and
standards that each of its business units and sites are required
to comply. Key elements of the policy include:
•
All fatalities and work-related illness can and must be
prevented; H&S always comes first in all decisions and
actions at all levels of the
Group.
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Management report
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•
Enhanced emphasis on management’s role while
recognizing and reinforcing that all employees need to be
actively involved in H&S management. Making it clear that
working safely is a condition of employment for everyone at
ArcelorMittal.
•
Explicitly stating that everyone is empowered to act and
stop work if they see a situation which they deem to be
unsafe.
•
Stressing the need to report and analyze all incidents, so
that employees and management learn from them across
the Company.
•
Highlighting the role effective management systems and
sharing of best practices has in driving continuous
improvements.
Further oversight of safety performance is provided by the
GHSC which is chaired by the Head of Corporate H&S. This
committee provides governance, oversight, alignment of H&S
initiatives and ensures best practice is shared across all
segments.
In June 2022, the executive Short-Term Incentive Plan ("STIP")
was linked to the frequency of proactive Potential Serious Injury
and Fatality events ("PSIFs") rates with a fatality frequency rate
circuit breaker. The proportion of bonuses linked under this
scheme to safety was increased from 10% to 15% in 2021.
Safety performance also represents 10% of the Long-Term
Incentive Plan.
ArcelorMittal dss+ workplace safety audit
In October 2024, the Group published the recommendations of
the comprehensive dss+ safety audit that was commissioned at
the end of 2023.
The audit, which was ongoing for nine months across all
geographies, functions and levels of the organization, had three
main scopes:
•
Fatality prevention standards for the three main
occupational risks leading to serious injuries and fatalities
(work at heights, vehicle driving ad energy isolation);
•
Process Safety Management ("PSM") focused on the
highest risk assets; and
•
In-depth assessment of H&S systems, processes and
capabilities; governance and assurance processes; and
data management
It was a comprehensive audit with dss+ having unprecedented
access across the Group from the Board to the shop floor.
Specifically, 155 sites (including joint ventures), were audited for
the FPS compliance and 14 highest risk assets were audit for
the PSM. For the H&S management systems and governance
and assurance reviews, more than 280 employees including the
Board of Directors, senior and middle management, H&S
personnel, and contract employees were interviewed. Further,
the auditors attended more than 60 management and H&S
meetings; and conducted more than 80 focus group sessions
with shop floor employees (union and non-union), supervisors
and middle management.
dss+ presented its recommendations to the Company’s Board of
Directors, the Executive Office and the Group Management
Committee. Overall, while there are areas of excellence in the
Group, variability in performance exists which must be
addressed by initiatives that fast-track the strengthening of “one
safety culture,” underpinned by enhanced governance and
assurance across all operations.
The recommendations were focused on six main areas:
1
Improving the identification and understanding of
operational risk exposure:
Strengthening the identification
and understanding of operational risk exposure by
enhancing the governance framework to better identify and
understand operational risk exposures and building on the
existing fatality prevention standards to upgrade the “Plan
Do Check Act” (PDCA) cycle, supported by additional
governance practices (e.g., additional leading indicators
and enhanced risk-management routines).
2
Strengthening the existing health & safety assurance
model:
Strengthening the assurance model with three-lines
of assurance, and operationalizing the model through
regular assurance reviews.
3
Continuing to embed safety values, mindsets and behaviors
to strengthen the “one safety culture”:
On-the-ground
coaching and mentorship programs for all leaders (involving
more than 10,000 people) to reinforce the existing safety
training programs.
4
Improving contractor safety management standards:
Standardizing and improving each contractor safety
management element (e.g., contractor selection,
evaluation, onboarding, execution and post-performance
review) across all contractor cohorts (embedded and
projects contractors) to bring any lagging contractor safety
performance up to ArcelorMittal’s standard requirements.
5
Adopting industry best practices for PSM:
Developing and
implementing a common PSM framework and
accompanying standards that further incorporates best
practices in all relevant PSM elements while ensuring
alignment with relevant management systems (e.g.,
operations and maintenance) to improve controls
effectiveness and mitigate process safety-related risk.
6
Integrating H&S elements into supporting business
processes:
Further integrating supporting business
processes into H&S with a focus on four processes: a)
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further integrate safety elements into all parts of the
employee life cycle encompassing selection, onboarding,
development and promotion; b) consistently rewarding and
recognizing good performance and achievements, and
increase consequences for not following processes and
rules, e.g. consequence management; c) further enhance
the identification of critical safety investments to support
risk reduction efforts; and d) strengthening safety
management practices throughout capital projects life cycle,
from design, engineering, procurement, and contracting, to
construction and start-up, including governance and
assurance framework.
Business specific plans have been developed to implement the
recommendations of the dss+ safety audit and to be
incorporated into the five-year planning cycle. Key highlights of
the progress to date include:
•
The new Process Safety Framework has now been
launched with a first wave of 12 assets.
•
The H&S assurance model has been strengthened, with
three lines of assurance across all business units, to
provide more comprehensive oversight starting in the first
quarter of 2025. The third line will directly report to the
Board Audit and Risk Committee.
•
Progress in the development of ‘One Safety Culture’ across
the Group will be measured in June 2025.
•
Consequence management standards are becoming
stronger across the Group as a result of the Company's
‘Just and Fair Expectations’ rolled out in January 2025.
Furthermore, the Company is tracking and auditing the
compliance of local policies mirroring these expectations. It
also continues to strengthen the health and safety focus in
all its human resource processes and practices.
Performance in 2024
In 2024, there were 13 fatalities in 13 events, of which 6 were
ArcelorMittal employees and seven were contractors. The
Company fatality frequency rate ("FFR") was 0.03; and Lost
Time Injury Frequency Rate ("
LTIFR
") was 0.70.
The Company has not delivered the progress on safety for
which it had hoped in 2024. The whole Company is working
hard on the dss+ audit recommendations and it is now moving
from the planning phase to full implementation in 2025. This
combined with swift action taken by business unit CEOs where
issues are identified will support the Company in its journey to
zero fatalities.
6 of the 13 fatalities were in the EU region which comprises
Europe Flat Products, Europe Long Products and the European
operations of Sustainable Solutions. Within the EU region, the
Europe Flat Products operations were fatality-free for the first
time in 2024 while the Europe Long Products operations had 4
fatalities after a period of two years with no fatalities.
The fatalities within Europe Long Products have led to
immediate action taken across this part of the business. All site
CEOs stepped back from operational role duties for a period of
four weeks to focus 100% of their time on safety at their site, led
by the ArcelorMittal Europe Long Products CEO, who decided to
take on the additional role of Head of H&S, which continues
today. During this period, all site CEOs were required to put
together and publish a Workplace Safety Assessment roadmap
with clear actions and accountabilities. This four-week period,
culminated in all site CEOs and H&S heads attending a two day
seminar to present their roadmap (which incorporates the dss+
recommendations) and share best practices. The roadmaps are
now in execution mode and are tracked on a bi-weekly basis
with every site by the ArcelorMittal Europe Long Products CEO.
ArcelorMittal continues working harder towards its zero fatality
goal and has already seen some encouraging signs that the
leading indicators are starting to move in the right direction
across the Group. The proactive PSIFs rate is now starting to
stabilize at between 16.5 and 17. This demonstrates the
maturity of this measure and emphasizes the improvement seen
in the safety processes and culture. Furthermore, ArcelorMittal
employees were certified on the Life Saving Golden Rules in
2024. The certification is designed to raise awareness of the
importance of these rules and will be rolled out to regular
contractors during the first half of 2025.
|
For the year ended December 31
|
LTIFR 2024
|
LTIFR 2023*
|
Fatalities 2024
|
Fatalities 2023*
|
PSIFs 2024
|
PSIFs 2023*
|
|
North America
|
0.27
|
0.22
|
1
|
1
|
14.88
|
15.76
|
|
Brazil
|
0.21
|
0.26
|
2
|
0
|
21.95
|
22.02
|
|
Europe
|
1.34
|
1.46
|
4
|
2
|
19.20
|
14.70
|
|
Sustainable Solutions
|
1.01
|
0.78
|
2
|
0
|
14.71
|
14.43
|
|
Mining
|
0.18
|
0.10
|
1
|
0
|
9.17
|
13.17
|
|
Others
|
0.81
|
1.39
|
3
|
58
|
11.31
|
18.78
|
|
TOTAL
|
0.70
|
0.92
|
13
|
61
|
16.89
|
16.64
|
*Prior period figures have been revised retrospectively in accordance with the new segment structure applicable at January 1, 2024.
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Management report
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Climate change and decarbonization
Along with safety, climate change is a top material sustainability
issue for ArcelorMittal. Since 2018, total absolute emissions of
the Company’s operations have reduced by 86
million tonnes
CO
2
(approximately 46
%)
, primarily due to footprint and asset
optimization of some of ArcelorMittal's most CO
2
intensive
capacity. In 2024, EAFs comprised 25% of the Group’s global
production, as compared with 19% in 2018.
ArcelorMittal’s progress and activities related to decarbonization
have been across four key areas:
•
Disciplined, competitive decarbonization capital
expenditures
•
Securing the resources for the transition
•
Fostering the development of a supportive environment
for decarbonization, and
•
Enabling the transition of key sectors.
The Company remains committed to achieving net-zero by
2050. Given the recent announcements made by the Company
regarding its decarbonization plans in Europe, the 2030 intensity
target
s
are under review and will be set out in the forthcoming
Climate Action Report 3.
Disciplined and competitive decarbonization
ArcelorMittal’s previously announced decarbonization
investments in Europe are progressing at a slower pace than
initially envisioned. The previously announced intention to
replace several blast furnaces with lower carbon emissions
“hydrogen ready” DRI-EAF facilities was premised on a
favorable combination of policy, technology and market
developments that would help offset the significantly higher
capital and operating costs involved. Progress so far has been
insufficient to support the investment case. The Company
expects several important developments in 2025, including the
scheduled review of the CBAM, an anticipated review of the
steel safeguards (necessary to protect the industry from unfair
trade resulting from China’s excess capacity), and the
publication of the Steel and Metals Action Plan amongst others.
The Company continues to optimize its decarbonization plans,
focused on achieving an acceptable return on the capital to be
invested. Whilst the Company awaits more support and policy
progress in Europe, it is continuing with engineering work, as
well as analyzing a phased approach that would first start with
constructing EAFs, which can also be fed with scrap steel to
significantly reduce emissions.
The Company has three announced EAF projects that are
already progressing in Gijón (Spain) (see "Introduction—
Sustainable developments highlights"), Sestao (Spain) and at its
joint venture AMNS Calvert (USA), the latter which is now
commissioning. Overall, ArcelorMittal has invested
$1 billion
decarbonization capital expenditures
since 2018, mainly in EAF
investments, DRI/EAF engineering studies and CCUS pilots.
Gijón, Spain
ArcelorMittal has started the construction of an EAF for long
products at its Gijón plant, which is expected to produce its first
heat in the first quarter of 2026. This investment of €213 million
will be the first major EAF project to be implemented within the
Company’s decarbonization program in Europe and will
constitute the first step towards low-carbon emissions
steelmaking in Asturias. See "Introduction— Sustainable
developments highlights".
Sestao, Spain
Sestao is in an advantageous position as very few producers in
Europe are capable of producing low-carbon emission flat steel
via the EAF route today. There has been good progress with the
Company's efforts to increase production to 1.6 million tonnes
by 2026 at its flat products plant in Sestao where it has two
EAFs. Once complete, much of this production will be XCarb®
RRP low-carbon emissions steel.
Sestao is also Europe’s first Compact Strip Production ("CSP")
mill line that combines continuous casting, heating and rolling of
slabs, and the plant can produce steel from melting start to
coiling finish in approximately 3 hours. This type of plant
benefits from energy saving compared to conventional
production, due to its simplified and shortened production cycle
minimizing reheating needs.
AMNS Calvert, USA
The joint venture has invested in a new 1.5 million-tonnes EAF,
see "Properties and capital expenditures—Capital
expenditures".
Securing the resources for the transition
ArcelorMittal has been investing in key resources to support the
decarbonization of the Group including renewables and high
quality metallics.
Access to clean electricity
Grid decarbonization in countries where the Company operates
has helped its CO
2
footprint over the past few years, especially
in countries with high renewable penetration (for example Spain,
France and Canada), although the overall impact has been
limited. As countries continue to accelerate clean energy
deployment and build the additional grid infrastructure needed
as part of their climate goals, further progress is expected.
The Company is also investing in secure access to renewable
energy by developing its own renewable energy projects, in
regions where competitive projects can be developed due to the
high quality of natural resources and enabling conditions in
place (grid infrastructure, supporting policies,
etc.
). Currently,
the Company has a 2.1GW renewable energy portfolio:
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AM Green Energy
The Company is investing in developing renewable projects that
will help with the decarbonization of AMNS India. A $0.7 billion
investment in the 1 GW renewable energy project launched in
2022 by ArcelorMittal. The project integrates solar and wind
power generation,
coupled with energy storage solution through
a co-located pumped hydro storage plant, which helps to
overcome the intermittent nature of wind and solar power
generation.
The project is owned and funded by ArcelorMittal.
AMNS India entered into a 25 year off-take agreement with
ArcelorMittal to purchase renewable electricity annually from the
project, resulting in over 20% of the electricity requirement at
AMNS India’s Hazira plant coming from renewable sources,
reducing carbon emissions by approximately 1.5 million tonnes
per year. 100% of the solar modules and 96% of the wind
turbines have already been installed. The project has begun
commissioning in a phased manner and has started supply of
renewable power to AMNS India. The Company is studying
various options to develop subsequent phases to further
increase renewable electricity capacity in India. See "Properties
and capital expenditures—Capital expenditures".
ArcelorMittal Argentina
In Argentina, ArcelorMittal has developed a partnership with
PCR for a 130MW solar and wind capacity project, which is
already operational and supplies over 30% of ArcelorMittal’s
local
electricity requirements, and a 180 MW wind project to be
completed by 2027 with a total investment of $255 million.
ArcelorMittal Brazil
In 2024, in addition to the joint venture agreement with Casa
dos Ventos signed in 2023 for the development of a 554MW
capacity wind power project (see "Properties and capital
expenditures— Investments in joint ventures"), ArcelorMittal
Brazil signed contracts for the development of two solar energy
projects with a combined capacity of 465MW, equivalent to 14%
of its current electricity requirements see "Introduction—
Sustainable developments highlights".
Securing metallics input
The main challenge when it comes to raw materials
for low
carbon emissions steelmaking (high-quality iron ore for DRI
production or high-quality scrap, both to be used as input in
EAFs)
is their availability. The first (high-quality iron ore)
represents only about 4% of global iron ore supply and scrap is
a scarce resource in many regions. Accordingly, the key actions
the Company is taking in this area are focused on securing and
diversifying the
supply of hi
gh-quality raw materials by
expanding existing operations and acquiring new businesses.
AMMC
In 2021, the Company announced that a
CAD$205
million
investment, supported by the Quebec government, would
enable AMMC to convert its entire 10 million tonnes per year
pellet production to DRI pellets. The project is in the
construction phase and is expected to be completed by the
second quarter of 2026. It is expected to become one of the
world’s largest producers of DRI pellets, the raw material
feedstock for iron-making in a DRI furnace. The project includes
the implementation of a flotation system that is expected to
enable a significant reduction of silica in the iron ore pellets,
facilitating the production of very high-quality pellets. It is also
expected to deliver a direct annual carbon emissions reduction
of approximately 200,000 tonnes at AMMC’s Port-Cartier pellet
plant, equivalent to over 20% of the pellet plant’s total annual
carbon emissions.
ArcelorMittal Texas HBI
In 2022, the Company secured high-quality metallic feedstock
and purchased a majority shareholding in a world-class HBI
plant in Texas (USA). The plant has a 2 million tonnes
production
capacity
. HBI is a high-quality feedstock made
through the direct reduction of iron ore which is used to produce
high-quality steel grades in an EAF, but which can also be used
in blast furnaces, resulting in lower coke consumption. The
facility is state-of-the-art, built with best-in-class technology and
equipment supplied by
MIDREX Technologies
. Its coastal
location with access to a deep shipping channel allows for cost
effective transportation. It also has the advantage of unused
land that provides options for further development for additional
HBI capacity.
Increasing access to high quality scrap
ArcelorMittal is already one of the biggest recyclers of steel in
the world, recycling around
19 million tonne
s of scrap every
year.
As part of the Sustainable Solutions segment, the recycling
business oversees the acquisition and processing of scrap,
supplying recycled steel to ArcelorMittal’s EAFs and offering
closed loop model to customers. In 2022 and 2023, the
Company acquired three recycling business: John Lawrie
Metals, Alba International Recycling, and Riwald Recycling with
a processing capacity of almost 1 million tonnes of scrap steel.
Investing in innovative and breakthrough technologies
The Company is already operating several commercial-scale
projects to test and prove a range of CCUS technologies and is
also partnering with different stakeholders in the value chain to
overcome challenges to deploy these solutions at scale.
CCS Carbon Hub in Ghent, Belgium
ArcelorMittal started a feasibility study for the Ghent Carbon
Hub project in partnership with North Sea Port and energy
infrastructure group Fluxys. The Ghent Carbon Hub will be an
open-access hub to transport and liquefy CO
2
from emitters,
provide buffer storage and load the CO
2
onto ships for onward
permanent storage. The project should have the capacity to
process 6 million tonnes of CO
2
per year – equivalent to around
15% of Belgium’s industrial CO
2
emissions. North Sea Port, a 60
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kilometer-long cross border port in Belgium and the
Netherlands, is home to a cluster of energy intensive industries
with a significant CO
2
footprint. In late 2022, the project was
awarded a €9.6 million grant from the EU Commission’s
Connecting Europe Facility for Energy (CEF-E) funding
program.
MHI carbon capture plant: capturing and storing off-gases from
the steelmaking process
Also in Ghent, the Company has partnered with Mitsubishi
Heavy Industries (MHI), BHP and Mitsubishi Development for a
pilot carbon capture project to test the capture of off-gases from
the blast furnace at a rate of 300kg of CO
2
per day in an initial
phase, using MHI’s proprietary carbon capture technology. The
project, which has been operational since May 2024, will also
involve a second phase that involves testing the separation and
capture of CO
2
in hot strip mill off-gases (and potentially on
DRI).
3D DMX™: capturing and storing blast furnace waste gas for
transporting and storage in Dunkirk, France
In Dunkirk (France), a successful CCS pilot project has been
completed, using low temperature heat to separate CO
2
from
other blast furnace off-gases at a capture rate of 0.5 tonnes of
CO
2
per hour. The project, which started in April 2023,
successfully achieved high capture rates.
Steelanol CCU plant
The Steelanol facility at ArcelorMittal's steel plant in Ghent
(Belgium) reached full operational capacity in November 2023
and is currently converting carbon-rich industrial emissions from
its blast furnace into fuel-grade ethanol by using leading carbon
recycling technology developed by LanzaTech. The produced
ethanol can be sold directly into fuel markets, or further purified
or converted for use in a wide array of consumer products such
as apparel, personal care, and packaging. In December 2024,
LanzaTech took title to the first barge shipment, which is purified
and sold to LanzaTech’s CarbonSmart customers in fragrance
and home care markets.
The Company is also investing in technologies that can become
a leading option for very low carbon emission steel production:
Direct electrolysis
ArcelorMittal is making progress in commercializing direct
electrolysis technology. In June 2023, ArcelorMittal and John
Cockerill announced plans to construct the world's first industrial
scale low temperature iron electrolysis plant. The project is
running according to schedule.
XCarb® innovation fund
The Company has continued its investments in innovative
breakthrough decarbonization technologies that hold strong
potential to decarbonize steelmaking operations. In July 2024,
the Company announced the selection of three start-ups as the
joint winners of its inaugural XCarb® India Accelerator Program
focused on CCUS technologies and biochar production. In
September 2024, the Company announced the investment of $5
million in Utility Global, a company that has developed a
patented reactor which processes variable industrial process
gases, without the use of electricity, into high-purity hydrogen
and a concentrated CO
2
stream that can be captured and
stored.
Fostering the development of a supportive environment
Due to the scale of transformation required in the global
economy to achieve net-zero, policy making has a critical role to
play. The significant capital expenditure needed to transition to
low carbon technologies, and their higher operating costs
especially in the EU, needs to be addressed by governments
through incentivization of markets and funding and economic
support. ArcelorMittal has actively engaged and continues to do
so with governments, policy makers and related organizations
and interest groups, to build the appropriate policies and
economic and social conditions to achieve the changes required
in a commercially viable manner.
ArcelorMittal believes that it is crucial that the newly announced
policy initiativ
es of the new European Commission in the
January 29, 2025 Competitiveness Compass Communication –
including but not only the Clean Industrial Deal and the Steel
and Metals Action plan:
•
Result in increased trade protection against massive global
excess capacity and unfair competition and more robustly
enforced trade
defence
instruments
•
Ensure a solution for competitiveness of EU exports, e.g.,
through an ETS rebate, ETS exemption or continuation of
free allowances for export volumes
•
Considerably strengthen the CBAM to avoid carbon
leakage and circumvention by major redirection of low
carbon steel towards Europe without global emission
reduction (resource shuffling)
•
Include access to sufficient affordable energy
•
Include technology neutral simplified funding processes for
large scale decarbonization investments
•
Support the demand for low-carbon steel through low
carbon steel lead markets.
The global investor community is playing a key role in providing
the support and finance for the net-zero transition. Climate is a
key part of ESG governance that is causing a greater focus on
and scrutiny of key performance data such as carbon emissions
reduction. Investors are increasingly aligning their portfolios with
the goals of the Paris Agreement, often using third-party ratings
and proxies to do so. ArcelorMittal continues to engage with
such initiatives to ensure that the challenges and opportunities
of competitively transitioning multiple steelmaking assets across
multiple regions into a low carbon economy are clearly
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Management report
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understood and that the approaches adopted are realistic and
pragmatic.
The Company is focused on engaging with numerous other
important strategic initiatives that gather key stakeholders to
identify the main challenges and requirements for the steel
sector’s transition.
These include the Energy Transition
Commission (ETC), Industry Transition Accelerator (ITA), World
Business Council for Sustainable Development (WBCSD),
Organization for Economic Cooperation and Development
(OECD), World Trade Organization (WTO), World Steel
Association and ResponsibleSteel
TM
,
amongst others.
Enabling the transition of key sectors.
Delivering low-carbon emissions steel solutions
In March 2021, the Company launched XCarb®, which at the
time was the only low-carbon emissions steel offering on the
market. The two initial products were:
•
XCarb® green steel certificates. These agglomerate
savings from interventions in the steelmaking process made
specifically to reduce carbon emissions such as capturing
coke-oven gas and re-injecting it into the blast furnace or
reducing coal use through natural gas injection in the blast
furnace. The savings are then passed on to customers
alongside their physical steel purchases, enabling them to
report an equivalent reduction in their Scope 3 emissions.
•
XCarb®RRP. This is a physical low-carbon emissions steel
product made in an EAF powered entirely by renewable
electricity, with high levels of recycled steel as the metallic
input.
The Company continues to lead the market with sales of
XCarb® low-carbon emissions steel, which have a carbon
footprint of as low as 300kg per tonne of steel produced.
XCarb® sales increased from 0.2 million tonnes in 2023 to 0.4
million tonnes in 2024. The Sestao revamp project is expected
to materially increase the Company’s ability to produce low-
carbon emissions flat products.
ArcelorMittal is also actively managing its product portfolio to
ensure that it is well positioned to capture areas of growth,
focusing on strategic higher value-added products. The
Company is increasing its portfolio of climate solutions
(electrical steels, renewables, insulation, sheet piles) to support
customers in key sectors of the low carbon economy. Key
examples include:
•
Hydrogen: On August 1, 2024, ArcelorMittal launched the
steel brand HyMatch® for hydrogen transport pipelines and
supporting the implementation of hydrogen infrastructure
globally
•
Electric Vehicles: On February 6, 2025, ArcelorMittal
announced a project to construct an advanced
manufacturing facility in Calvert, Alabama see "Introduction
—
Sustainable development highlights". This builds upon
the facility under
construction in Mardyck (France) which
will produce 170,000 tonnes and the existing site in France
at Saint-Chely d'Apcher (80,000 tonnes)
•
Low carbon emissions buildings: On May 31, 2024,
ArcelorMittal announced that it was adding to the existing
portfolio in lightweighting insulation panels through
acquisitions of Italpannelli’s Italian and Spanish businesses.
Combined, the two facilities operate seven production lines
with a capacity of thirteen million m
2
of sandwich panels a
year.
These solutions build on those already available across the
group in low-carbon emissions buildings (e.g. Steligence brand),
renewables (e.g. Magnelis® for solar) and flood protection
(EcoSheetPile™ Plus range).
The role of standards in driving demand for low-carbon
emissions steel
In line with its intention to lead developments in decarbonization,
ArcelorMittal published a concept for a low-carbon emissions
steel standard in June 2022 to help incentivize the
decarbonization of steelmaking globally and support the creation
of market demand for physical steel products which would be
classified as lower, and ultimately near-zero, carbon emissions
steel. The concept involves:
•
A dual scoring system which provides customers with a
LCA value alongside a rating system which measures a
company’s progress towards near-zero
•
Incentivizing the decarbonization of both primary and
secondary steelmaking
•
Providing transparency and consistency across steel
products for customers
•
Supporting the development of markets for low-carbon
emissions steel
The Company believes that the creation of clear definitions for
low-carbon emissions physical steel is an important component
of ‘demand pull’ and ‘supply push’ mechanisms that are required
to support the steel industry in its transition to net-zero by 2050.
Clear definitions will also help inform targeted policy to support
the scale-up and commercialization of these near-zero
technologies.
These views concur with those of several credible independent
bodies, including the Centre for Climate Aligned Finance, The
Energy Transitions Commission, The International Energy
Agency, which have all published proposals on this topic, and
ResponsibleSteel™, which has launched a certifiable standard.
The Company also endorsed the World Trade Organization’s
Steel Standards Principles that were launched at COP28.
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Climate governance and risk management
Structures and decision-making
ArcelorMittal’s climate-related activity and progress continues to
be overseen by a robust governance structure that includes an
executive-level
Climate Change Panel
and Board-level
Sustainability Committee chaired by an independent non-
executive director. T
he Board also decided to link executive
remuneration to the achievement of the Company's climate
objectives.
Since 2021, decarbonization targets are part of the
performance criteria for vesting of the performance share units
in the long-term incentive plan.
In terms of investment decision-making, each major capital
expenditure project proposal is required to demonstrate its
carbon impact as part of the project review to the IAC. The IAC
makes all necessary considerations to maximize the business’
chances of achieving its targets while ensuring each project is
economically justifiable and earns its cost of capital. It is a
crucial part of the Company’s strategy to manage risk and
deliver long-term growth.
Climate-related risks and opportunities
ArcelorMittal conducted an assessment to identify risks and
opportunities arising from the transition to a low-carbon
economy. The approach included examining key regions of
operation and offering a forward-looking review. It considered
scenarios aligned with external reference scenarios as shown in
the resilience analysis section.
The assessment of transition-related climate risks and
opportunities was conducted at a regional/country level and
categorized into various groups: policy and legal, technology,
reputation, resilience, products, and market. The strategic
relevance for each risk and opportunity identified was
determined through a qualitative assessment, considering the
potential impact to relevant financial indicators, like capital
expenditures, operational expenditures, revenue, and access to
capital. Where relevant, the impact on profitability or investment
value was also considered.
The scenarios used to inform the identification and assessment
of physical and transition risks were the following:
|
1.5C scenario
|
<2C scenario
|
Business as usual
|
High Emissions
|
|
|
Temperature by 2100
|
1.5°C
|
Below 2°C
|
>2°C
|
>4°C
|
|
External reference scenarios
|
IEA NZE
|
IPCC SSP1-2.6, IEA APS/
SDS
|
SSP2-4.5 and IEA STEPS
|
IPCC SSP5-8.5
|
|
Description
|
•
Holds warming to
approximately 1.5°C,
aligned with the Paris
Agreement.
•
Steel demand by 2050
projected at 2 Gtonnes
per year
|
•
Assumes a strong global
commitment to reducing
GHG emissions, leading
to low levels of warming
•
Steel demand by 2050
projected between 2.1
and 2.7 Gtonnes per
year
|
•
Assumes moderate
efforts to reduce GHG
emissions and balanced
outcome in terms of
socio-economic
development and climate
change impacts
•
Steel demand by 2050
projected between 2.2
-2.7 Gtonnes per year
|
•
Assumes GHG
emissions continue to
rise, leading to high
levels of warming and
significant climate
change impacts
|
|
Used for physical risks
assessment
|
No
|
Yes
|
Yes
|
Yes
|
|
Used for transition risks/
opportunities assessment
|
Yes
|
Yes
|
Yes
|
No
|
|
Used for target analysis and
decarbonization plan
|
Yes
|
Yes
|
Yes
|
No
|
These scenarios were used to conduct screenings to qualitatively identify material climate-related risks and opportunities. Main results
are summarized below:
Transition risks and opportunities
For the transition screening assessment, the Company used
three scenarios: 1.5°C, below 2°C and business as usual to
stress-test the exposure to transition climate risks.
Material climate change related transition risks and
opportunities, are summarized below. The results are for 2030
under the 'below 2C' and the ‘1.5C’ scenarios, as these capture
the most significant transition impacts:
•
Regulatory and Policy related risks: see "Introduction
—
Risk Factors and Control—
Laws and regulations restricting
emissions of greenhouse gases could force ArcelorMittal to
incur increased capital and operating costs and could have
a material adverse effect on ArcelorMittal’s results of
operations, financial condition and reputation".
•
Opportunities arising from enabling low-carbon transition in
key sectors: Low-carbon transition within the Company's
core customer sectors presents an opportunity to improve
and/or expand the product portfolios to meet customers'
requirements. Some example of this include electrical steel
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for
electric motors used to power battery electric vehicles;
plug in hybrid electric vehicles and hybrid vehicles; low-
carbon steel products;
HyMatch® for hydrogen transport
pipelines and supporting the implementation of hydrogen
infrastructure. Refer to 'Enabling the transition of key
sectors' covered above.
P
hysical risks
ArcelorMittal conducted further analysis of its climate change
related physical risks in 2024
to assess exposure of its assets to
climate hazards. A total of 170 assets, including mining, iron and
steelmaking, downstream processing, recycling, and forest
management sites, were covered. To conduct this assessment,
a third-party climate data analytics tool was used to analyze the
exposure of assets to flood, extreme precipitation, heat, cold,
fire, drought, wind, and hail related risks.
This analysis considered three IPCC scenarios and was based
at the asset-specific geospatial coordinate levels. Climate
hazards were evaluated over three-time horizons: short-term
(2025), medium-term (2030), and long-term (2050). The short-
and medium-term time horizons align with ArcelorMittal’s 5-year
strategic planning, while the long-term horizon covers the
lifespan of most assets.
The three key risks identified included:
•
Heat stress, concentrated primarily in the tropical and
subtropical regions where high temperatures are already
common and are likely to worsen (Mexico, Brazil, Liberia
and India). Heatwaves can also have a significant impact in
Europe.
•
Flood exposure risk mainly concentrated in the Northern
Europe region, specifically in areas located in close
proximity to rivers or in coastal areas. Sites in Mexico,
Brazil, India and Europe have severe to high exposure to
precipitation, which also presents flooding risk.
•
High water stress caused by a combination of high heat and
low precipitation primarily concentrated in the Northern
Europe, North America, Southern Africa and South Asia
regions.
Since this assessment, the Company has conducted segment-
level capacity building training exercise to increase awareness
about the results of this assessment and the key principles to be
considered for site-specific plans to reduce
such risks.
Carbon performance (based on 2024 data)
In 2024, the Company’s adjusted group intensity KPI was 1.75
tonnes of CO
2
emissions per tonne of crude steel ("tCO
2
e/tcs").
Significant reductions are only likely to be made with the
successful deployment of steelmaking and energy
transformation projects. In order to view the trend for CO
2
e
intensity of steel only, the Company also reports the data for
2018, adjusted for structural changes to its portfolio to enable a
like for like annual comparison. This shows a reduction of 5.4%
since 2018, from 1.85tCO
2
e/tcs to
1.75t
CO
2
e/tcs. The Company
saw a 5.0% improvement in 2024, down to 1.62tCO
2
e/tcs from
the 2018 baseline of
1.71t
CO
2
e/tcs for its European adjusted
KPI – CO
2
e intensity of its steel operations (Scopes 1 and 2).
The adjusted absolute emissions that correspond to the
Company’s global target KPI (Scope 1 and 2, steel and mining)
decreased by 25% compared with 2018.
The following indicators are used to measure and monitor
ArcelorMittal's decarbonization progress:
|
Metric
|
Unit
|
Scope + perimeter
|
2018
|
2022
|
2023
|
2024
|
2018-2024
Reduction
|
|
Adjusted absolute CO
2
e footprint
1
|
Million tonnes
|
ArcelorMittal Scope 1+2
|
136.3
|
106.2
|
98.5
|
101.9
|
25
%
|
|
Adjusted absolute CO
2
e footprint
1
|
Million tonnes
|
Europe Scope 1+2
|
67.6
|
54.5
|
48.4
|
51.5
|
24
%
|
|
Adjusted Group CO
2
e intensity KPI
1
(steel and mining)
|
tCO
2
e/tonne of steel
|
ArcelorMittal Scope 1+2
|
1.85
|
1.82
|
1.78
|
1.75
|
5.4
%
|
|
Adjusted Europe CO
2
e intensity KPI
1
(steel)
|
tCO
2
e/tonne of steel
|
Europe Scope 1+2
|
1.71
|
1.71
|
1.68
|
1.62
|
5.0
%
|
|
CO
2
e intensity steel only
2
|
tCO
2
e/tonne of steel
|
Steel Scope 1+2+ limited
scope 3
|
2.09
|
1.98
|
1.96
|
1.87
|
10.7
%
|
|
Adjusted CO
2
e intensity
1,2
steel only
|
tCO
2
e/tonne of steel
|
Steel Scope 1+2+ limited
scope 3
|
1.95
|
1.88
|
1.86
|
1.87
|
4.3
%
|
1.
These figures have been retrospectively adjusted for structural changes to the ArcelorMittal portfolio in the previous 12 months, and reflect emissions and production for ArcelorMittal's site portfolio as at December 2024 to enable a like for like
annual comparison.
2.
This indicator includes limited upstream Scope 3 emissions from purchased goods that a steelmaker would normally be expected to produce, such as coke, slabs, burnt lime in order to maintain a consistent system boundary and so a like for
like comparison.
Ongoing focus on tailings dam safety
Tailings dam safety and structural integrity is a critical issue for
all mining companies, in order to protect the safety of local
communities and employees, and to protect the environment
from pollution and flooding.
The Company has developed a
tailings governance framework based on the Mining Association
of Canada (MAC), the Canadian Dam Association (CDA) and
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the Global Industry Standard for Tailings Management (GISTM).
The aim is to ensure that all Group tailings facilities are
structurally sound and safe, with all efforts directed at
minimizing risk, including independent audits benchmarked
against these international guidelines.
ArcelorMittal manages a total of
27 tailings storage facilities
(“TSF”). These include conventional, paste, dry and in-pit
facilities. There are 1
5
active, 1 dormant, 4 in care and
maintenance,
3
in closure and
4
under construction facilities. To
ensure their ongoing safety, a formal assurance process is in
place that includes internal and external audits. This is
supported by a continuous improvement program that reduces
the Company's risk of existing conventional operations by
promoting reduced moisture disposal methodologies (e.g. high-
density thickened tailings or filtered tailings where appropriate)
and proven new technologies (e.g. high-precision radar, InSAR
satellite monitoring and remote instrumentation) to monitor
facilities globally in real time. The Company is assessing all its
mining operations for transition in line with these principles and
developing customized design solutions for non-conventional
tailings system management.
Tailings thickening steps have been implemented in assets in
Mexico, reduced moisture disposal methodologies in Brazil and
Canada, and further studies are ongoing across a range of
operations.
Products and markets
Product overview
Information regarding segment sales by geographic area and
sales by type of products can be found in note 3 to
ArcelorMittal’s consolidated financial statements.
ArcelorMittal has a high degree of product diversification relative
to other steel companies. Its plants manufacture a broad range
of finished and semi-finished steel products with different
specifications, including many complex and highly technical and
sophisticated products that it sells to demanding customers for
use in high-end applications.
ArcelorMittal’s principal steel products include:
•
semi-finished flat products such as slabs;
•
finished flat products such as plates, hot- and cold-
rolled coils and sheets, hot-dipped and electro-
galvanized coils and sheets, tinplate and color coated
coils and sheets;
•
semi-finished long products such as blooms and billets;
•
finished long products such as bars, wire-rods,
structural sections, rails, sheet piles and wire-products;
and
•
seamless and welded pipes and tubes.
ArcelorMittal’s main mining products include iron ore lump,
fines, concentrate, pellets and sinter feed.
Steel-making process
Historically, primary steel producers have been divided into
“integrated” and “mini-mill” producers. Over the past few
decades, a third type of steel producer has emerged that
combines the strengths of both the integrated and the mini-mill
processes. These producers are referred to as “integrated mini-
mill producers”.
Integrated steel-making
In integrated steel production, coal is converted to coke in a
coke oven, and then combined in a blast furnace with iron ore
and fluxes to produce hot metal. This is then combined with
scrap in a converter, which is also referred to as basic oxygen
furnace ("BOF"), to produce raw or liquid steel. Once produced,
the liquid steel is metallurgically refined and then transported to
a continuous caster for casting into a slab, bloom or billet or cast
directly as ingots. The cast steel is then further shaped or rolled
into its final form. Various finishing or coating processes may
follow this casting and rolling. Recent modernization efforts by
integrated steel producers have focused on cutting costs
through eliminating unnecessary production steps, reducing
manning levels through automation, and decreasing waste
generation. Integrated mills are substantially dependent upon
iron ore and coking coal which, due to supply and demand
imbalances, shortening of contract durations and the linkage
between contract prices and spot prices, have been
characterized by price volatility in recent years.
Mini-mills
A mini-mill employs an electric arc furnace to directly melt scrap
and/or scrap substitutes such as direct reduced iron, thus
entirely replacing all of the steps up to and including the energy-
intensive blast furnace. A mini-mill incorporates the melt shop,
ladle metallurgical station, casting, and rolling into a unified
continuous flow. The quality of steel produced by mini-mills is
primarily limited by the quality of the metallic raw materials used
in liquid steel-making, which in turn is affected by the limited
availability of high-quality scrap or virgin ore-based metallics for
use in the electric arc furnaces. Mini-mills are substantially
dependent on scrap, which has been characterized by price
volatility in recent years, and the cost of electricity.
Integrated mini-mills
Integrated mini-mills are mini-mills that produce their own
metallic raw materials consisting of high-quality scrap
substitutes, such as DRI. Unlike most mini-mills, integrated mini-
mills are able to produce steel with the quality of an integrated
producer, since scrap substitutes, such as DRI, are derived from
virgin iron ore, which has fewer impurities. The internal
production of scrap substitutes as the primary metallic feedstock
provides integrated mini-mills with a competitive advantage over
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traditional scrap-based mini-mills by insulating the integrated
mini-mills from their dependence on scrap, which continues to
be subject to price volatility. The internal production of metallic
feedstock also enables integrated mini-mills to reduce handling
and transportation costs. The high percentage use of scrap
substitutes such as DRI also allows the integrated mini-mills to
take advantage of periods of low scrap prices by procuring a
wide variety of lower-cost scrap grades, which can be blended
with the higher-purity DRI charge. Integrated mini-mills are
substantially dependent upon iron ore which has been
characterized by price volatility in recent years (as described for
integrated steel production above). In addition, because the
production of direct reduced iron involves the use of significant
amounts of natural gas, integrated mini-mills are more sensitive
to the price of natural gas also than are mini-mills using scrap.
Key steel products
Steel-makers primarily produce two types of steel products: flat
products and long products. Flat products, such as sheet or
plate, are produced from slabs. Long products, such as bars,
rods and structural shapes, are rolled from blooms and/or billets.
Flat products
S
lab
. A slab is a semi-finished steel product obtained by the
continuous casting of steel or rolling ingots on a rolling mill and
cutting them into various lengths. A slab has a rectangular
cross-section and is used as a starting material in the production
process of other flat products (e.g., hot-rolled sheet, plates).
Slabs are typically between 200
millimeters
and 250
millimeters
thick.
Hot-rolled sheet.
Hot-rolled sheet is minimally processed steel
that is used in the manufacture of various non-surface critical
applications, such as automobile suspension arms, frames,
wheels, and other unexposed parts in auto and truck bodies,
agricultural equipment, construction products, machinery,
tubing, pipe and guard rails. All flat-rolled steel sheet is initially
hot-rolled, a process that consists of passing a cast slab through
a multi-stand rolling mill to reduce its thickness to typically
between 2 millimeters and 25 millimeters, depending on the final
product. Flat-rolled steel sheet that has been wound is referred
to as “coiled”. Alternatively, hot-rolled sheet can be produced
using the thin slab casting and rolling process, where the hot-
rolled sheet thickness produced can be less than one millimeter.
This process is generally used in a flat products mini-mill, but
some integrated examples exist as well.
Cold-rolled sheet.
Cold-rolled sheet is hot-rolled sheet that has
been further processed through a pickle line, which is an acid
bath that removes scaling from steel’s surface, and then
successively passed through a rolling mill without reheating until
the desired gauge, or thickness, and other physical properties
have been achieved. Cold-rolling reduces gauge and hardens
the steel and, when further processed through an annealing
furnace and a temper mill, improves uniformity, ductility and
formability. Cold-rolling can also impart various surface finishes
and textures. Cold-rolled steel is used in applications that
demand higher surface quality or finish, such as exposed
automobile and appliance panels. As a result, the prices of cold-
rolled sheet are higher than the prices of hot-rolled sheet.
Typically, cold-rolled sheet is coated or painted prior to sale to
an end-user.
Coated sheet
. Coated sheet is generally cold-rolled steel that
has been coated with zinc, aluminum or a combination thereof
to render it corrosion-resistant and to improve its paintability.
Hot-dipped galvanized, electro-galvanized and aluminized
products are types of coated sheet and in recent times hot
dipped coatings composed of zinc, magnesium and aluminum
have grown in popularity. These are also the highest value-
added sheet products because they require the greatest degree
of processing and tend to have the strictest quality
requirements. Coated sheet is used for many applications, often
where exposed to the elements, such as automobile exteriors,
major household appliances, roofing and siding, heating and air
conditioning equipment, air ducts and switch boxes, external
structural applications as well as in certain packaging
applications, such as food containers.
Plates.
Plates are produced by hot-rolling either reheated slabs
or ingots. The principal end uses for plates include various
structural products such as for bridge construction, storage
vessels, tanks, shipbuilding, line pipe, industrial machinery and
equipment.
Tinplate
.
Tinplate is a light-gauge, cold-rolled, low-carbon steel
usually coated with a micro-thin layer of tin. Tinplate is usually
between 0.14 millimeters and 0.84 millimeters thick and offers
particular advantages for packaging, such as strength,
workability, corrosion resistance, weldability and ease in
decoration. Food and general line steel containers are made
from tinplate.
Electrical steels.
There are two principal types of electrical steel:
non-grain oriented fully processed steels and non-grain oriented
semi-processed steels.
Non-grain oriented fully processed
steels are iron-silicon alloys with varying silicon contents and
have similar magnetic properties in all directions in the plane of
the sheet. They are principally used for motors, generators,
alternators, ballasts, small transformers and a variety of other
electromagnetic applications. A wide range of products,
including a newly developed thin gauge material for high
frequency applications, are available. Non-grain oriented semi-
processed steels are largely non-silicon alloys sold in the not
finally annealed condition to enhance punchability. Low power
loss and good permeability properties are developed after final
annealing of the laminations.
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Long products
Billets/Blooms.
Billets and blooms are semi-finished steel
products. Billets generally have square cross-sections up to 180
millimeters by 180 millimeters, and blooms generally have
square or rectangular cross-sections greater than 180
millimeters by 180 millimeters. These products are either
continuously cast or rolled from ingots and are used for further
processing by rolling to produce finished products like bars, wire
rod and sections.
Bars.
Bars are long steel products that are rolled from billets.
Merchant bar and reinforcing bar (rebar) are two common
categories of bars. Merchant bars include rounds, flats, angles,
squares, and channels that are used by fabricators to
manufacture a wide variety of products such as furniture, stair
railings, and farm equipment. Rebar is used to strengthen
concrete in highways, bridges and buildings.
Special bar quality (“SBQ”) steel
.
SBQ steel is the highest
quality steel long product and is typically used in safety-critical
applications by manufacturers of engineered products. SBQ
steel must meet specific applications’ needs for strength,
toughness, fatigue life and other engineering parameters. SBQ
steel is the only bar product that typically requires customer
qualification and is generally sold under contract to long-term
customers. End-markets are principally the automotive, heavy
truck and agricultural sectors, and products made with SBQ
steel include axles, crankshafts, transmission gears, bearings
and seamless tubes.
Wire rods
. Wire rod is ring-shaped coiled steel with diameters
ranging from 5.5 to 42 millimeters. Wire rod is used in the
automotive, construction, welding and engineering sectors.
Wire products
. Wire products include a broad range of products
produced by cold reducing wire rod through a series of dies to
improve surface finish, dimensional accuracy and physical
properties. Wire products are used in a variety of applications
such as fasteners, springs, concrete wire, electrical conductors
and structural cables.
Structural sections
. Structural sections or shapes are the
general terms for rolled flanged shapes with at least one
dimension of their cross-section of 80 millimeters or greater.
They are produced in a rolling mill from reheated blooms or
billets. Structural sections include wide-flange beams, bearing
piles, channels, angles and tees. They are used mainly in the
construction industry and in many other structural applications.
Rails
. Rails are hot-rolled from a reheated bloom. They are used
mainly for railway rails but they also have many industrial
applications, including rails for construction cranes.
Seamless tubes
. Seamless tubes have outer dimensions of
approximately 25 millimeters to 508 millimeters. They are
produced by piercing solid steel cylinders in a forging operation
in which the metal is worked from both the inside and outside.
The final product is a tube with uniform properties from the
surface through the wall and from one end to the other.
Steel sheet piles
. Steel sheet piles are hot rolled products used
in civil engineering for permanent and temporary retaining
structures. Main applications are the construction of quay walls,
jetties, breakwaters, locks and dams, river reinforcements and
channel embankments, as well as bridge abutments and
underpasses. Temporary structures like river cofferdams are
made with steel sheet piles. A special combination of H beams
and steel sheet piles are sometimes used for the construction of
large container terminals and similar port structures.
Welded pipes and tubes
. Welded pipes and tubes are
manufactured from steel sheet that is bent into a cylinder and
welded either longitudinally or helically.
Mining products
ArcelorMittal’s mining products correspond to iron ore which is
also one of the main raw materials for steel operations.
ArcelorMittal’s mining and raw materials supply strategy
consists of:
•
Acquiring and expanding production of raw materials, in
particular iron ore but as well some other specific
products crucial to the Company's steel operations such
as refractory and lime (in partnership with companies
who are leaders in these domains), while keeping the
cost under control;
•
Exploiting its global purchasing reach, pursuing the
lowest unit price available based on the principles of total
cost of ownership and value-in-use through aggregated
purchasing, supply chain and consumption optimization;
and
•
Leveraging local and low cost advantages on a global
scale.
ArcelorMittal’s priority is to optimize output and production from
its existing sources focused mainly on iron ore.
ArcelorMittal believes that its portfolio of mining assets and long-
term supply contracts (see below "—Raw materials and
energy") can play an important role in preventing disruptions in
the production process. (see “Operating and financial review—
Key factors affecting results of operations—Raw materials”).
ArcelorMittal sources significant portions of its iron ore needs
from its own mines in Ukraine, Bosnia, Canada, Mexico, Liberia
and Brazil. Several of ArcelorMittal’s steel plants also have in
place off-take arrangements with suppliers located near its
production facilities.
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For further information on Mining segment iron ore production,
see “Operating and financial review—Operating results”. For
further information on each of ArcelorMittal’s principal iron ore
mining operations including total mining production of iron ore
and coal, see “Properties and capital expenditures—Property,
plant and equipment” and "Properties and capital expenditures
—Property, plant and equipment— Mineral reserves and
resources".
Markets
As shown by the following graph, ArcelorMittal has a diversified
portfolio of steel a
nd mining products to meet a wide range of
customer needs across many steel-consuming sectors,
including automotive, appliance, engineering, construction,
energy and machinery and via
distributors.
* Other steel sales mainly represent metal processing, machinery, electrical
equipment and domestic appliances
**Other sales mainly represent mining, chemicals & water, slag, waste, sale of
energy and shipping
For the construction market, which represented 20% of the
Company's revenue in 2024, ArcelorMittal offers the most
complete range of grades and specifications of structural steel,
façade, ceiling and floor systems, sheet piles solutions for
foundations and underground car park systems, steel plumbing
solutions and a complete portfolio of reinforcement products.
This includes rebar developed specifically for areas with high
seismic activity, and steel
fibers
for tunnelling and other
infrastructure projects.
Automotive and mobility,
which represented
17%
of the
Company's revenue in 2024, offers a complete range of flat
steel products as follows:
•
Drawing steels: ArcelorMittal’s range of non-alloyed mild
steels is designed for deep and extra-deep drawing
applications. Products formed from these cold-rolled steels
are used extensively in the automotive industry for both visible
and structural parts.
•
High-yield high strength steels ("HSS") including high-
strength, low-alloy ("HSLA") steels for cold forming which are
noted for their low alloy content and ease of welding, Bake
hardening ("BH") steels that gain hardness during the paint
curing process, high strength Interstitial-free ("IF") steels for
deep drawing applications and solid solution steels which
combine mechanical strength and drawability and make them
suitable for structural part.
•
first generation AHSS: characterized by their high strength,
the first generation of AHSS still has many applications in
today’s mobility solutions such as Dual phase ("DP") steels
which offer a good compromise between strength and
stampability, Transformation Induced Plasticity ("TRIP") steels
suitable for complex structural and reinforcement parts,
complex phase steels for applications which require high
energy absorption capacity and fatigue strength and Hot
rolled ferrite-bainite steels that combine high strength with
formability and stampability.
•
third generation AHSS: such steels have been specifically
developed for OEMs who utilize cold stamping and forming
technologies; they include Fortiform® range of ultra high
strength steels ("UHSS") for lightweight structural elements,
DH family of steels for safety parts which require impact
resistance and CH family of steels which are the new
generation of the Complex Phase grade. These grades are
particularly suitable for automotive safety which enhance
crash resistance.
•
Martensitic steels which offer good formability, even at
extremely high strengths and makes them particularly useful
in anti-intrusion applications where they contribute to
lightweighting while enhancing safety.
•
Press hardenable steels ("PHS") offer ultra high strength and
the ability to be formed into complex shapes. This makes
them ideal for hot stamping processes and enables OEMs to
achieve excellent weight reductions across the vehicle.
ArcelorMittal's PHS offer includes Usibor® for critical parts
where strength is key and Ductibor® for optimized ductility
and strength.
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•
Full range of coatings to protect steels for automotive
applications such as Alusi®, Extragal®, Ultragal®,
Galvannealed, Zagnelis® Protect, Zagnelis® Surface, Galfan,
Electrogalvanised
, a
nd Jetgal®.
•
iCARe® which is ArcelorMittal’s range of electrical steels for
e-mobility and helps to increase the driving range of electric
and hybrid vehicles.
iCARe® steels also help to lightweight
motors and electrical systems in conventional internal
combustion engine ("ICE") vehicles.
•
Laser welded blanks and tailored shaped blanks.
Mobility also includes:
•
maritime transport: ArcelorMittal steel products are used to
build all varieties of ships, including general cargo carriers,
container ships, cruise ships and large tankers that carry
liquefied natural gas. The Company also makes sheet piles
– columns of steel driven into the ground to support a
structure – used in the construction of ports and harbors.
•
rail transport: ArcelorMittal makes steel products for both
railway tracks and trains.
In the
energy
market, ArcelorMittal is a leading supplier of
specialist steels to the wind energy industry, supplying heavy
plates and coils for towers, reinforcing bars and ballast for
foundations, and electrical steels for generators. For solar
energy, the Company provides the high-performance steels,
coatings and structural solutions that the latest generation of
solar photovoltaic and solar thermal installations are built from.
Although the renewable energy
transition
is underway, the world
will still rely on traditional fossil fuels such as oil and gas during
this transitional phase. ArcelorMittal supplies the steels for
onshore and offshore platforms, liquified natural gas ships,
pipelines, refineries, and fuel storage. Steel plates are also a
core component for pressure vessels and many other major
structural applications in power generation and petrochemical
processing.
ArcelorMittal also offers an extensive range of products serving
all parts of the packaging industry. This includes tin or chromium
plated steel with a wide range of mechanical properties, and a
variety of coating options.
In addition, ArcelorMittal produces a range of special grades flat
steel products for appliances such as:
•
Estetic®: Organic coated pre-painted steels that offer the
gloss, surface aspects and finishes that appliance makers
need, while reducing energy use and environmental impact
during manufacture
•
Electrical grades: Steels to improve the performance of
components such as electric motors and refrigerator
compressors
•
Solfer®: Enamelling steels for ovens, cookers and hoods
•
Magnelis®: 'Self-healing' steel useful for parts that are
exposed to moisture and movement
•
Jetskin®: Homogeneous metallic steel coating applied with
a pioneering technique and offering outstanding corrosion
protection
Raw materials and energy
Iron ore
ArcelorMittal is a party to contracts with other mining companies
that provide long-term, stable sources of raw materials.
The
Company extended its multi-year iron ore supply
contracts with
Vale in 2024
to cover its requirements for the EU units,
worldwide direct reduction units and for its
Tubarão
steel mill
(ArcelorMittal Pecém, ArcelorMittal Brasil, being covered by a
specific long-term agreement).
ArcelorMittal's principal
international iron ore suppliers include Vale in Brazil,
Luossavaara-Kirunavaara AB in Sweden, Baffinland Iron Mines
Corporation ("BIM") in Canada, IOC (Rio Tinto Ltd.) in Canada,
Samarco in Brazil, Anglo-American (Minas Rio in Brazil), and
Metinvest in Ukraine.
Coal
ArcelorMittal’s principal coal suppliers include the BHP Billiton
Mitsubishi Alliance (“BMA”), Anglo Coal, Peabody, Glencore in
Australia, Contura and Warrior in the United States, Teck Coal in
Canada, and JSW in Poland.
Metallics (scrap)
ArcelorMittal procures the majority of its scrap requirements
locally and regionally, optimizing transport costs. Typically, scrap
purchases are made in the spot market on a monthly/weekly
basis or with short-term contracts.
Alloys
ArcelorMittal purchases its requirements of bulk and noble
alloys from a number of global, regional and local suppliers on
contracts that are linked to generally-accepted indices or
negotiated on a quarterly basis.
Base metals
The majority of the Company’s base metal needs, including
zinc, tin, aluminum and nickel are purchased under annual
volume contracts. Pricing is based on the market-accepted
indices. Material is sourced from both local and global
producers.
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Electricity
ArcelorMittal generally procures its electricity through tariff-
based systems in regulated areas such as parts of the United
States and South Africa, through direct access to markets in
most of its European mills or through bilateral contracts
elsewhere. The duration of these contracts varies significantly
depending on the area and type of arrangement.
For integrated steel mills, plant off-gases from various process
steps are utilized to generate a significant portion of the plant’s
electricity requirements and lower the purchase volumes from
the grid. This is either produced by the plant itself or with a
partner in the form of a co-generation contract.
Natural gas
ArcelorMittal procures much of its natural gas requirements for
its Canadian and Mexican operations from the natural gas spot
market or through short-term contracts entered into with local
suppliers, with prices fixed either by contract or tariff-based spot
market prices. For its European and Ukrainian operations, with a
contractual mix of “all-in” bilateral supply and direct access to
the market, ArcelorMittal sources its natural gas requirements
with European short term/spot-indexed supply contracts. The
remainder of ArcelorMittal’s natural gas consumption is
generally sourced from regulated markets.
Industrial gases
Most of ArcelorMittal’s industrial gas requirements are produced
and supplied under long-term contracts with various suppliers in
different geographical regions.
Coke
ArcelorMittal has its own coke-making facilities at most of its
integrated mill sites, including in Canada, Brazil, Spain, France,
Germany, Belgium,
Poland
, South Africa, and Ukraine. While
ArcelorMittal meets most of its own coke requirements, certain
of ArcelorMittal’s operating subsidiaries purchase coke mainly
from seaborn market from China, U.S, Japan, Australia,
Colombia, and Indonesia and certain of its subsidiaries
occasionally also sell excess coke at market prices to third
parties.
Shipping
ArcelorMittal Shipping ("AM Shipping") provides ocean
transportation solutions to ArcelorMittal’s manufacturing
subsidiaries and affiliates. AM Shipping determines cost-efficient
and timely approaches for the transport of raw materials, such
as iron ore, coal, coke and scrap, and semi-finished and finished
products. AM Shipping is also responsible for providing shipping
services to the Company’s sales organizations. It provides
complete logistics solutions from plants to customer locations
using various modes of transport.
In 2024, AM Shipping arranged transportation for approximately
54.1 million tonnes of raw materials and about 7.2 million tonnes
of finished products. The key objectives of AM Shipping are to
ensure cost-effective and timely shipping services to all units.
AM Shipping also acts as the coordinator for Global Chartering
Ltd., the Company's joint venture with DryLog Ltd., a Monaco
based shipping company.
Purchasing
ArcelorMittal has implemented a global procurement process for
its major procurement requirements, including raw materials,
capital expenditure items, energy and shipping. ArcelorMittal’s
centralized procurement teams also provide services such as
optimization of contracts and the supply base, logistics and
optimizing different qualities of materials suitable for different
plants and low cost sourcing.
By engaging in these processes, ArcelorMittal seeks to benefit
from economies of scale in a number of ways, including by
establishing long-term relationships with suppliers that
sometimes allow for advantageous input pricing, pooling its
knowledge of the market fundamentals and drivers for inputs
and deploying specialized technical knowledge. This enables
ArcelorMittal to achieve a balanced supply portfolio in terms of
diversification of sourcing risk in conjunction with the ability to
benefit from a number of its own raw materials sources.
ArcelorMittal has institutionalized the “total cost of ownership”
methodology as its way of conducting its procurement activities
across the Group. This methodology focuses on the total cost of
ownership for decision making, with the goal of lowering the
total cost of production through minimization of waste, improved
input material recovery rates and higher rates of recycling.
Sustainability principles are embedded into ArcelorMittal general
procurement conditions, purchasing contracts, in the onboarding
process and supplier performance management in the area of
safety, health, environment, human rights, and employee
relations.
Sales and marketing
In 2024, ArcelorMittal sold
54.3
million tonnes of steel products.
Sales
The majority of steel sales from ArcelorMittal are destined for
domestic markets. For these domestic markets, sales are
usually approached as a decentralized activity that is managed
either at the business unit or at the production unit level. For
certain specific markets, such as automotive, there is a global
approach offering similar products manufactured in different
production units around the world. In instances where
production facilities are in relatively close proximity to one
another, and where the market requirements are similar, the
sales function is aggregated to serve a number of production
units. In the EU and in South America, ArcelorMittal owns a
large number of service and distribution centers. Depending on
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the level of complexity of the product, or the level of service
required by the customer, the service center operations form an
integral part of the supply chain to ArcelorMittal’s customers.
Distribution centers provide access to ArcelorMittal’s products to
smaller customers that cannot or do not want to buy directly
from the operating facility.
The Group prefers to sell exports through its international
network of sales agencies to ensure that all ArcelorMittal
products are presented to the market in a cost-efficient and
coordinated manner.
Sales are executed at the local level, but are conducted in
accordance with the Group’s sales and marketing and code of
conduct policies.
For some global industries with customers in more than one of
the geographical areas that ArcelorMittal serves, the Company
has established customized sales and service functions. This is
particularly the case for the automotive industry. Sales through
this channel are coordinated at the Group level with respect to
contract, price and payment conditions.
Marketing
Marketing follows the sales activity very closely and is by
preference executed at the local level. In practice, this leads to a
focus on regional marketing competencies, particularly where
there are similarities among regional markets in close
geographical proximity. Local marketing provides guidance to
sales on forecasting and pricing. At the global level, the
objective is to share marketing intelligence with a view towards
identifying new opportunities, either in new products or
applications, new product requirements or new geographical
demand. Where a new product application is involved, the in-
house research and development unit of ArcelorMittal is
involved in developing the appropriate products.
An important part of the marketing function at ArcelorMittal is to
develop short-range outlooks that provide future perspectives on
the state of market demand and supply. These outlooks are
shared with the sales team in the process of finalizing the sales
strategy for the immediate future and with senior management
when market conditions call for production adjustments.
Globally, sales and marketing activities are coordinated to
ensure a harmonized approach to the market. The objective is
to provide similar service experiences to all customers of
ArcelorMittal in each market.
Intellectual property
ArcelorMittal owns and maintains a patent portfolio covering
processes and steel products, including uses and applications
that it creates, develops and implements in territories throughout
the world. Such patents and inventions primarily relate to steel
solutions with new or enhanced properties, as well as new
technologies that generate greater cost-efficiencies.
ArcelorMittal also owns trademarks, both registered and
unregistered, relating to the names and logos of its companies
and the brands of its products. ArcelorMittal has policies and
systems in place to monitor and protect the confidentiality of its
know-how and proprietary information. The Company applies a
general policy for patenting selected new inventions, and its
committees organize an annual patent portfolio screening by
individuals from the Company’s R&D and business sectors in
order to optimize the global efficiency of the Company’s patent
portfolio. The Company’s patent portfolio includes more than
14,000
patents and patent applications, mostly recent and
medium-term, for more than 930 patent families, with 110
inventions newly-protected in 2024. Because of this constant
innovation, the Company does not expect the lapse of patents
that protect older technology to materially
affect medium term
revenue.
In addition to its patent portfolio, ArcelorMittal is constantly
developing technical know-how and other unpatented
proprietary information related to design, production process,
decarbonization solutions for steel production and use of high
quality steel products, leading to development of new
applications or to improvement of steel solutions proposed to its
customers, such as the ones aiming at weight reduction for
vehicles. ArcelorMittal has also been granted licenses for
technologies developed by third parties in order to allow it to
propose comprehensive steel solutions to customers.
ArcelorMittal is not aware of any pending lawsuits alleging
infringement of others’ intellectual property rights that could
materially harm its business.
Government regulations
ArcelorMittal’s operations are subject to various regulatory
regimes in the regions in which it conducts its operations. The
following is an overview of the principal features of the
Company's regulatory regimes, as of December 31, 2024, that
affect or are likely to significantly affect the Company's
operations.
See also “Introduction—Risk factors and Control
”, "Sustainable
Development
—
Health and Safety" a
nd note 9.3 to
ArcelorMittal’s consolidated financial statements.
Environmental laws and
regulations
ArcelorMittal’s operations are subject to a broad range of laws,
directives and regulations relating to air emissions, surface and
groundwater protection, wastewater storage, treatment and
discharges, the use and handling of hazardous or toxic
materials, waste management, recycling, treatment and disposal
practices, the remediation of environmental contamination, the
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protection of soil, biodiversity and ecosystems or rehabilitation
(including in mining).
As environmental laws and regulations in the European Union
(“EU”) stemming from the Green Deal and other jurisdictions
continue to become more stringent, ArcelorMittal expects to
spend substantial resources, including operating and capital
expenditures, to achieve or maintain ongoing compliance.
Further details regarding specific environmental proceedings
involving ArcelorMittal, including provisions to cover
environmental remedial activities and liabilities,
decommissioning and asset retirement obligations are described
in note 9.1 to ArcelorM
ittal’s consolidated financial
statements
.
Globally, the regulatory backdrop to environmental compliance
in industry is developing rapidly and becoming more stringent,
notably through the roll-out of the CSRD reporting and
preparation for Task Force on Nature-related Financial
Disclosure ("TNFD"). Environmental impacts such as that of air
emissions are coming under greater scrutiny as evidenced by
the updated air quality guidelines issued by the World Health
Organization ("WHO") in September 2021. These guidelines
have contributed to the recent adoption of the Air Quality
Directive (Directive (EU) 2024/2881), alongside the updated
Best Available Techniques Reference Document ("BREF") for
the Ferrous Metals Processing Industry, among others. These
changes will result in stricter environmental norms concerning
pollution (emissions to air, water and land), broader impacts on
natural environments, habitats and biodiversity, and energy
efficiency and resource efficiency, as well as promoting more
sustainable industrial production (part of the European
Commission’s Green Deal for a climate-neutral continent) and
increased transparency of information available to public.
European
Union
The revised Industrial Emission Directive (Directive 2024/1785
or “IED 2.0”) entered into force in August 2024. The overall aim
of the IED 2.0 is to minimize the impact of pollution on people’s
health and the environment by reducing harmful industrial and
intensive livestock emissions across the EU. The IED 2.0
imposes stricter rules for defining emission
limit values
and in
respect of permit requirements as well as tighter compliance
and control rules with additional enforcement provisions. The
operators of industrial installations will need to develop
transformation plans to achieve the EU's 2050 zero pollution,
circular economy, and decarbonization goals. The revised
directive focuses on resource use performance levels, as well
as lower chemical pollution through requirements for a reduced
use of toxic chemicals. Furthermore, the new EU Industrial
Emissions Portal Regulation (EU) 2024/1244 which replaces the
European Pollutant Release and Transfer Register Regulation
(E-PRTR) entered into force in May 2024. This revision
enhances public access to information related to industrial
emissions. During the next two years, the European
Commission will work on implementing rules, with the first report
under the revised directive (describing releases and resource
use in 2027) scheduled for publication in 2028.
In the context of supply chain, the German Supply Chain Due
Diligence Act 2022 ("Lieferkettensorgfaltspflichtengesetz"),
which came into force in January 2023, provides a legal
framework for fulfilling human rights due diligence obligations
and requires that German companies undertake due diligence in
their supply chains and motivate their contract partners abroad
to protect internationally recognized human rights and
environmental standards.
Additionally, in July 2024, the Directive on Corporate
Sustainability Due Diligence Directive ("Directive 2024/1760")
(CS3D) entered into force, establishing a corporate due
diligence duty, including to identify and address potential and
actual adverse human rights and environmental impacts in the
company’s own operations, the operations of its subsidiaries
and, where related to their value chain(s), those of its and their
business partners. In addition, Directive 2024/1760 sets out an
obligation for large companies to adopt and put into effect,
through best efforts, a transition plan for climate change
mitigation aligned with the 2050 climate neutrality objective of
the Paris Agreement as well as intermediate targets under the
European Climate Law.
ArcelorMittal has established and updated policies in response
to these requirements. It aims to assess risks by identifying
them with regards to negative impacts on human rights within
the Company's value chain; to deal with negative impacts by
taking preventive measures to minimize and remedy potential
impacts; to follow up on the progress of these measures; to
communicate the results to its stakeholders; and to set up
complaint mechanisms.
In December 2015, 195 countries participating in the United
Nations Framework Convention on Climate Change (“UNFCC”),
at its COP21 held in Paris, adopted a global agreement on the
reduction of climate change (the “Paris Agreement”). The Paris
Agreement sets a goal to limit the increase in the global average
temperature to well below 2 degrees Celsius and pursues efforts
to limit the increase to 1.5 degree Celsius, to be achieved by
getting global GHG emissions to peak as soon as possible. The
Paris Agreement consists of two elements: first, a legally binding
commitment by each participating country to set an emissions
reduction target, referred to as nationally determined
contributions (“NDCs”), with a review of the NDCs that could
lead to updates and enhancements every five years beginning
in 2023 (Article 4), and second, a transparency commitment
requiring participating countries to disclose in full their progress
(Article 13). Most countries have issued their intended NDCs.
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The United Nations Climate Change Conference COP 28
reached a deal for transitioning away from fossil fuels in energy
systems, in a just, orderly, and equitable manner, as well as on
tripling renewable energy capacity globally by 2030, speeding
up efforts to reduce coal use, and accelerating technologies
such as CCUS that can decrease emissions of hard-to-abate
industries. By 2025, countries must present their updated NDCs
aimed at being aligned with the 1.5 degree Celsius limit. At COP
29, a new collective quantified goal on climate finance destined
towards developing countries was reached, and the rules for the
operationalization of Article 6 of the Paris Agreement, which
provides for bilateral and global carbon trading were finalized.
On July 14, 2021, the European Commission adopted the Fit for
55 Package with a view to adapting climate and energy
legislation to the 2030 ambition set by the European Climate
Law. The EU also committed internationally to its 55% reduction
target. Most of the initiatives of the Fit for 55 Package have
been adopted as of December 31, 2024, amending several
pieces of legislation that were already applicable to
ArcelorMittal, such as the EU-ETS, the Renewable Energy
Directive (“RED”) and the Energy Efficiency Directive (“EED”) as
well as introducing the
CBAM
. CBAM is a tool to put an
equivalent price to that faced by domestic production on the
carbon emitted during the production of certain goods that are
imported into the EU. The CBAM established a transition period
of October 1,2023 to December 31, 2025, during which there
will be no financial obligation besides the possibility of penalties
being imposed for failures to report. There are some
implementation rules stemming from the ETS and CBAM that
are still currently under preparation. In addition, the Energy
Taxation Directive (“ETD”) is expected to be revised in 2025.
ArcelorMittal’s activities in the 27 member states of the EU are
subject to the EU-ETS, which was launched in 2005 pursuant to
European Directive 2003/87/EC, relating to GHG emissions.
The EU-ETS is based on a cap-and-trade principle, setting a
cap on GHG emissions from covered installations that is then
reduced over time. Within this cap, companies receive emission
allowances which they can sell to or buy from one another as
needed. The limit on the total number of allowances available
ensures that they have a value.
In order to achieve the EU 2030
55% reduction ambition, the ETS requires sectors under ETS to
reduce their emissions by 62%. As required by the EU Climate
Law, the Commission has begun to define a Europe-wide 2040
target. In February 2024, the Commission presented its
assessment for a 2040 climate target for the EU, recommending
reducing the EU’s net GHG emissions by 90% by 2040 relative
to 1990. The legislative proposal to amend the EU Climate Law
with a 2040 target is expected in the first quarter of 2025. The
review of the ETS will follow to reflect the adopted 2040 target.
The implementation rules for the second trading period of Phase
IV (2026-2030) will further reduce c
urrent benchmark values
,
although the adopted approach will prevent a large disruptive
decrease of the hot metal benchmark. Still, the resulting
shortage in free allocation levels would put the European steel
industry at a significant disadvantage versus global competition
(see note 9.1 to the consolidated financial statements).
To
prevent such disadvantages, CBAM has been established for a
limited number of sectors, including steel, with a transitional
period that started in October 2023 and runs until the end of
December 2025, with the initiation of CBAM payments in 2026.
In the case of the steel sector, only direct emissions will be
covered, at least through 2025, allowing access to indirect cost
compensation. On the other hand, free allocation to covered
sectors will be progressively phased out as follows: 2026:
97.5%, 2027: 95%, 2028: 90%, 2029: 77.5%, 2030: 51.5%,
2031: 39%, 2032: 26.5%, 2033: 14%, and 0% as from 2034.
The agreement does not include a solution for exports but
requires the European Commission to prepare an assessment
and report by 2025. Several implementing acts to supplement
the CBAM regulation are still to be developed.
Moreover, the revised Renewable Energy Directive (“RED”) was
adopted in November 2023, increasing the current EU-level
target of at least 32% of renewable energy sources in the overall
energy mix to at least 42.5% by 2030. Member States must also
collectively endeavor to increase the share of energy from
renewable sources in the EU’s gross final consumption of
energy in 2030 to 45%. The RED aims to deploy renewables
across all sectors, particularly in sectors where progress in
integrating renewables had been slower.
Additionally, the revised Energy Efficiency Directive (“EED”)
raised the EU energy efficiency target, making it binding for EU
countries to collectively ensure an additional 11.3% reduction in
energy consumption by 2030 compared to the 2020 reference
scenario projections. In addition, the revised Land Use, Land
Use Change and Forestry (“LULUCF”) sets a target for net GHG
removals at 310 million tonnes of CO
2
equivalent as a sum of
the values of the GHG net emissions and removals by Member
States in 2030. The LULUCF sector is connected to all
ecosystems and economic activities that rely on the land and
the services it provides, thus directly impacting ArcelorMittal’s
sites.
Furthermore, the Eco-design for Sustainable Product Regulation
(“ESPR”) is a cornerstone in the European Green Deal for more
environmentally sustainable and circular products. The new
regulation acts as a framework and complements existing
product regulation. The regulation is implemented following a
workplan through secondary legislation by Delegated Acts. As
part of the new Commission work plan, the Joint Research
Centre (“JRC”) is expected to finalize a preparatory study on
Iron and Steel Products by June 2025. The ESPR framework
will make "Digital Product Passports" mandatory and must
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ensure that relevant environmental information is transferred
along the supply chain on a need-to-know basis.
Environmental requirements impacting industrial operations are
also becoming more stringent in various jurisdictions.
Argentina
Argentina's goal is to achieve carbon neutrality by 2050, and it
has outlined its NDCs compromises for 2030, reinforcing them
through participation in COP 28. During 2023, the Argentinian
government established two key strategies: one for the Carbon
Trade Market (Resolution N° 385/2023) and another for
Hydrogen Economy Development. The program was launched
in 2023 with the participation of more than 120 participants, and
the roadmap for the industrialization of hydrogen as a productive
vector in the energy transition was presented.
Additionally, the Renewable Energy Law has set mandatory
national targets for electricity consumption from renewable
energy sources: 8% in 2018; 12% in 2019/20; 16% in 2021/22;
18% in 2023/24; and 20% in 2025. All energy-intensive
industries must contribute to these mandatory national targets,
but no significant impact on the Company is expected. Acindar
has outlined its renewable energy business plan as follows: (i)
for the Villa Constitución Site, targets are being met by
purchasing renewable energy from Cammesa.
Brazil
In Brazil, new federal laws have been established in 2024 to
guide climate change adaptation plans and create a legal
framework for low-carbon hydrogen, including incentives and
programs for its production and development. The states of
Minas Gerais, Ceará and Santa Catarina have also introduced
their own green hydrogen policies. Additionally, federal laws
have launched programs to promote sustainable low-carbon
mobility, including green mobility, sustainable aviation fuel,
green diesel, and biomethane. A national air quality policy has
been established, setting standards and guidelines for air quality
management. Forestry has been excluded from the list of
potentially polluting activities, and environmental licensing for
forestry has been simplified in Minas Gerais. Furthermore,
federal decrees have set guidelines for the national circular
economy strategy and regulated tax incentives for the recycling
production chain. In São Paulo, a state decree has established
a program to manage solid urban waste. S
pecific impacts are
yet to be regulated.
The state of Minas Gerais (where the Serra Azul Dam is
located) published State Decree No. 48.848/2024, which
included new types of guarantees, such as mortgages and
fiduciary alienation of real estate. The validity of bank
guarantees has been extended to a minimum of five years, with
financial institutions required to deposit the guaranteed credit
within 15 days if the debtor fails to renew the bond. Additionally,
the insurance policy must be issued by a Susep-authorized
insurance company, with the credit settlement period extended
to 30 days after notification. The deadline for presenting
environmental bonds for dams has been increased from 180 to
270 days. Furthermore, the real estate offered as a guarantee
can be re-evaluated at any time and must be supplemented if its
value is lower than declared. These changes aim to enhance
security and flexibility in managing environmental guarantees.
In 2022, Brazil launched Resolution No. 433/2021 establishing
the National Policy of the Judiciary for the Environment,
establishing the monitoring of climate actions and mandating
that indemnities for environmental damages include the impact
on global climate change, as well as diffuse damage to affected
peoples and communities. In September 2023, the Plenary of
the Brazilian National Council of Justice approved a Normative
Act recommending the adoption of a new protocol for the trial of
environmental damage actions by Brazilian courts. This aims to
enhance the effectiveness of judgments in environmental cases,
providing guidelines on the use of evidence obtained by sensors
and satellites. The focus is on preventing and combating
environmental externalities, particularly concerning climate
change and collective damage.
Brazil has established the Interministerial Committee on Climate
Change (“CIM”) through Decree No. 11.550/2023, published in
June 2023, which monitors the implementation of actions and
public policies within the federal executive branch related to the
National Policy on Climate Change (“PNMC”). The decree
revoked the former National System for the Reduction of
Emissions of Greenhouse Gases (“SINARE”), previously
established by Decree No. 11.075/2022.
Law No. 15.042/2024, which regulates the carbon market in
Brazil creating the Brazilian Greenhouse Gas Emission Trading
System was approved in December 2024. The new law is based
on a minimum emissions threshold rather than specific sectors.
Installations emitting above 10 thousand tonnes of CO
2
per year
per source or installation must report their emissions.
Installations emitting more than 25 thousand tonnes of CO
2
per
year, in addition to mandatory reporting, must carry out periodic
reconciliation of obligations. The regulation applies equally to all
sectors of the economy, except for primary agricultural
production which was expressly excluded.
The state of Ceará has published Law No. 18.458/2023,
instituting the state policy for green, sustainable hydrogen and
its derivatives within the scope of the state of Ceará and
creating the state council for governance and development of
the production of green, sustainable hydrogen and its
derivatives.
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Canada
In Canada, depollution attestations applicable to AMMC facilities
are currently being renewed and may include more restrictive
standards.
In the province of Quebec, the renewal requests for depollution
attestations for AMMC's Mont Wright operations, Fire Lake, and
Port-Cartier pellet plant are currently in the analysis stage by
environmental authorities. They aim to apply the same
standards to all mines. These permits establish targets for
water, air, soil, and waste management, as well as the
monitoring and reporting frequencies and requirements for each
target.
Furthermore, the Contrecoeur West depollution attestation was
scheduled to be renewed in 2023; the renewal application was
filed in June 2023, awaiting further input from the Government.
The Contrecoeur East depollution attestation is scheduled to be
renewed in 2026, the application must be filled in the third
quarter of 2025. Also, starting January 1, 2024, r
oyalty rates are
payable for
contaminated soils for landfilling (CAD$10/t) or
treating (CAD$5/t).
Quebec’s government expanded the scope of the regulation
related to compensation for adverse effects on wetlands and
bodies of water. It will apply to projects conducted in Port-
Cartier, Mont Wright, and Fire Lake and might extend to
AMLPC’s future projects. Also in Quebec, the regulation
respecting royalties payable for the use of water was amended
to increase, as of January 1, 2024, the royalty rates from
CAD$2.5 per million liters (“CAD$/ML”) of water to CAD$35/ML,
and from CAD$70/ML to CAD$ 150/ML. The applicable rate will
vary according to the use of the resource. These rates are
subject to i
ndexation every year by 3% per annum.
The ECCC, the Iron Ore Company of Canada, and AMMC have
entered into an environmental performance agreement effective
from January 5, 2018 until June 1, 2026. The agreement is
designed to facilitate the implementation of BLIERs developed
for the iron ore pellet sector. Specifically, it outlines the
composition, timelines, and objectives of the NOx Working
Group. The agreement aims to ensure compliance with BLIERs
limits for Particulate Matter ("PM") 2.5 and SO2 while also
overseeing the implementation of the approach to studying NOx
.
At the national level, the Environment and Climate Change
Canada (“ECCC”), a department of the Government of Canada,
updated the Base-Level Industrial Emissions Requirements
(“BLIERs”) under the federal Air Quality Management System,
resulting in the need for substantial investments to comply with
emission regulations. Provincial regulations in Ontario and
Quebec will also require additional emissions reductions.
In Ontario, the BLIER requires all coke plants in the province to
install coke oven gas desulphurization in order to meet SO2
limits by the end of December 2025. In 2023, ArcelorMittal
Dofasco received an exemption from the ECCC due to its
ongoing decarbonization efforts. Currently, on a plant-wide
basis, ArcelorMittal Dofasco’s facility is meeting its BLIERs
objective. Moreover, the decarbonization project will impact
ArcelorMittal Dofasco’s overall Nitrogen Oxide (“NOx”)
emissions.
In Canada, carbon pricing regulations have become increasingly
stringent. For example, the Order Amending Schedule 3 to the
GHG Pollution Pricing Act: Statutory Orders and Regulation
(“SOR”)/2022-210 introduces amendments to set the royalty
amounts per tonne of GHG emitted for the years 2023 to 2030.
As from January 1, 2022, ArcelorMittal Dofasco and Ontario
industries have been regulated on carbon pricing under the
Ontario Emissions Performance Standards (“EPS”), transitioning
out of the Federal output-based pricing system (“OBPS”). The
Federal government intends to ensure provincial GHG programs
are rigorous enough to meet Federal carbon reduction targets
(40 - 45% lower than in 2005 by 2030).
In March 2023, the Federal government updated the federal
benchmark. Ontario subsequently published changes to the
EPS carbon tax program for 2023 and 2030, which includes (i)
changes to carbon pricing from CAD$50/t CO2e to CAD$65/t in
2023 and increasing CAD$15/t annually up to CAD$170/t CO2e
by 2030, and (ii) changes to the stringency factors: -2.4% in
2023 and -1.5% annually from 2024 to 2030.
As part of the Ontario EPS program, the Ontario provincial
authority signaled a recognition of the significant transformation
in the steel sector for those large steel producers expected to
make the transition to clean steel production in the coming
years. In consideration of the changes at these facilities,
stringency factors would be set equal to one for the transition
period up to 2030; thus, exemptions will be considered for first
movers in the steel sector. Final details have been provided and
the Director's official issuance notice for the amendments were
issued in the second quarter of 2024.
The development of an approach to address facility-specific
emissions targets for the innovative DRI facilities has been
completed, often based on three years of performance following
the start-up of a facility. Detailed discussions concluded in 2023,
and the final Director’s order was issued in the first quarter of
2024. The proposed approach to address ArcelorMittal
Dofasco’s decarbonization program during the transformation
periods has also been developed. Compliance of Director's
order is to be achieved by reducing GHGs as well as additional
first-mover considerations by the regulator.
In Quebec, the 2030 Plan for a Green Economy sets a 37.5%
GHG emission reduction target by 2030 compared with 1990
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levels, with the goal that Quebec reaches carbon neutrality by
2050. Separate consultations by the government of Quebec are
underway with large GHG emitters regarding the cap-and-trade
program regulation for the second and subsequent compliance
periods from 2021 to 2030. Quebec completed the consultations
for the 2021 to 2023 compliance period. For the period 2024 to
2030, negotiations are still in progress to minimize the financial
impact of regulatory changes on ArcelorMittal’s operating
subsidiaries in Canada.
As part of Canada’s climate plan to reduce emissions and
accelerate the use of clean technologies and fuels, in June
2022, the final Clean Fuel Regulations (“CFR”) under the
Canadian Environmental Protection Act 1999 (“CEPA”) were
registered, bringing the 2017 Clean Fuel Standard (“CFS”) into
law. It came into force upon registration, except for two sections
repealing the pre-existing Renewable Fuels Regulations
(“RFRs”), which will come into force on September 30, 2024.
The CFS establishes lifecycle carbon intensity requirements
separately for liquid, gaseous, and solid fuels that are used in
transportation, industry, and buildings. This performance-based
approach, intended to incentivize innovation, development, and
use of a broad range of lower-carbon fuels, alternative energy
sources, and technologies, only requires liquid fuel (e.g.,
gasoline, diesel, home heating oil) suppliers to reduce the
carbon intensity of their fuels. Gaseous and solid fossil fuels
have been eliminated from the scope. The Regulations will
increase production costs for primary suppliers, which would
increase prices for liquid fuel consumers.
Liberia
In Liberia, ArcelorMittal holds a mining concession, inclusive of
250 kilometers of rail and port facilities. The Environment
Protection Agency (“EPA”) in Liberia has heightened its
enforcement of environmental standards, supported by its
dedicated laboratories. The nearby presence of ArcelorMittal
Liberia (“AML”) installations has fueled local communities'
environmental awareness, increasing pressure on AML from
stakeholders.
Guided by the Environmental Protection Agency Act (2002) and
the Environment Protection and Management Law (2002),
comprehensive Environmental Impact Assessments (“EIAs”) are
mandatory for projects affecting the environment. In adherence
to these regulations, ArcelorMittal has developed an
Environmental and Social Standards Manual ("SSM"), approved
by the Liberian EPA, governing all activities within the existing
Liberia mining project. The SSM is regularly updated with
external consultants' input, and the SSM surpasses local
environmental requirements. ArcelorMittal's mining concession
falls within the purview of the National Forestry Reform Law
(2006), the National Forestry Law (2000), and the Act Creating
the Forestry Development Authority (2000). These laws govern
both commercial and community use of forests, and some
territories within the concession are subject to these regulations.
The Community Rights Law regarding Forest Lands (2009) has
notably empowered communities in forest management. The
stringent conditions attached to existing environmental permits
reflect the Company's dedication to sustainable operations; in
connection with the Phase 2 project, ArcelorMittal has
committed to an environmental offset program and mine closure
plan, potentially exceeding $100 million. In 2023, all
environmental permits were renewed, covering Yuelliton mining
activities, TSF construction, a new sewage plant, and the
rehabilitation of rail and port facilities, has elevated requirements
for sediment control, water discharge, and biodiversity
conservation. In tandem, AML has initiated a climate change risk
assessment and is participating in the TNFD studies.
On
October 17, 2024, the National Solid Waste Management Policy
was published by the Environmental Protection Agency. The
Policy outlines the vision of the Government of Liberia, which
recognizes that effective and efficient waste management is
essential for the development of sound public health and
improved quality of life.
Mexico
In March 2022, Mexico published a new standard on wastewater
discharges, reducing the maximum permissible limits and
introducing new parameters for quarterly monitoring and
reporting to the National Water Commission (“CONAGUA”).
ArcelorMittal internally defined a preliminary action plan to
enhance wastewater quality discharges in line with the
requirement of the standard through operational controls. In
April 2023, with prior authorization from CONAGUA,
ArcelorMittal submitted an action plan outlining milestones to
bring wastewater discharge in compliance with the new
standard. This program is scheduled to conclude in February
2027, with progress reports required to update on the program’s
milestones.
Additionally
,
due to the recent reform
of the National Mining
Regulation ("NMR"), several significant changes have been
made, mostly related to environmental, water and waste
management. With respect to water, the changes primarily
relate to water access by the population (in preference to
industrial use of water), which may have an impact on the ability
to use water for iron ore transportation. Several constitutional
claims against the NMR were submitted (including claims by
ArcelorMittal Mexico).
The final rulings are expected to be
resolved by the Supreme Court in 2025. As part of these
ongoing trends in water management, ArcelorMittal Mexico
joined the initiative of a National Agreement on Water and
signed the agreement on November 14, 2024, voluntarily
assigning 56.5% of its concessioned volume to the National
Water Commission for 2025.
To fulfil its commitments under the Paris Agreement, the federal
government of Mexico has published rules and principles for an
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emissions trading system (ETS) applicable to entities generating
more than 100,000 tons of CO
2
per year. Since 2020, a pilot of
the ETS has been implemented by ArcelorMittal México Long
and Flat Segments and Services areas (“SERSIINSA”), along
with other relevant companies. This pilot stage is still in
progress, with new rules potentially issued by the first quarter of
2025. During the pilot stage, ArcelorMittal México consistently
adhered to the environmental authority's ("SEMARNAT")
emission calculation and reporting criteria for the ETS.
ArcelorMittal's CO
2
emissions reports have consistently showed
zero deficits. Despite the initial plan for the operational stage to
start in 2023, In January 2024, SEMARNAT presented a
proposal of the operating rules of the ETS with new growth
factors and reduction factors for the mechanism to assign free
emission allowances for all participants sectors. The authority
has not officially defined operational stage rules, but an
unofficial final proposal is expected soon.
In addition, since 2023, there has been a very marked trend by
state governments in Mexico to implement green taxes on CO
2
emissions, which caused an additional tax impact on different
sectors that participate in other federal government schemes
(e.g., ETS). Working groups have been formed within several
trade associations and business chambers to promote
initiatives that minimize the economic impacts on the industrial
sector.
Taxes
range from $2.2 - $44.5
USD
per ton of CO
2
emitted.
South Africa
In South Africa, the proposed Phase 2 of the Carbon Tax
discussion paper has been published by the National Treasury
on November 13, 2024. The proposal as is poses a significant
increase in carbon tax liability to ArcelorMittal South Africa with
increase in annual carbon tax rates combined with a drastic
phase down of tax-free allowances and stricter eligibility criteria
to benefit from other tax-free allowances, all measures
projecting a significant impact in financial terms to unaffordable
levels. The proposal presented by National Treasury also
includes a higher carbon tax of R640/tCO
2
e for emissions
exceeding the allocated carbon budget to be applied to
taxpayers as a penalty.
Also in South Africa, on
Apri
l 26, 2024 the DFFE published the
Draft Sectoral Emission Targets (SETs) Report for public
comments. The report outlines institutional arrangements that
will guide the SETs allocation to support the country’s both
national and international commitments to mitigate climate
change.
Ukraine
In July 2024, Ukraine adopted the Law on "Integrated
Prevention and Control of Industrial Pollution" (IPPC Law),
which will enter into force on August 8, 2025. The document
aims to prevent, reduce and control pollution arising from
economic activities and applies an integrated approach to
pollution regulation and implementation of best available
technologies and management methods. According to the IPPC
Law, all new entities are required to obtain an integrated permit
after the law will enter into force. The existing entities have a
transition period of four years to obtain integrated permits.
ArcelorMittal closely monitors local, national, and international
negotiations, and regulatory and legislative developments, and
endeavors to reduce its emissions where appropriate.
Foreign trade
ArcelorMittal has manufacturing operations in many countries
and sells its products worldwide.
In 2024, certain countries and
regions, such as Canada, the EU, Me
xico, Turkey and the U.S.,
continued or launched investigations into whether to impose or
continue imposing trade remedies (usually anti-dumping or
safeguard measures) against injury, or the threat thereof,
caused by increasing steel imports originating from various steel
producing countries.
Under both international agreements and the domestic trade
laws of most countries, trade remedies are available to domestic
industries where imports are “dumped” or “subsidized” and such
imports cause injury, or a threat thereof, to a domestic industry.
Although there are differences in how trade remedies are
assessed, such laws have common features established in
accordance with World Trade Organization (“WTO”) standards.
Dumping involves exporting a product at a price lower than that
at which the same or similar product is sold in the home market
of the exporter, or where the export prices are lower than a
value that typically must be at or above the full cost of
production (including sales and marketing costs) plus a
reasonable amount for profit. Subsidies from governments
(including, among others, grants and loans at artificially low
interest rates) are similarly actionable under certain
circumstances. The trade remedies available are typically (i) an
anti-dumping duty order where injurious dumping is found and
(ii) a countervailing duty order or suspension agreement where
injurious subsidization is found. Normally, the duty is equal to
the amount of dumping or subsidization that is generally
imposed on the imported product (other than in the EU where
the lesser duty rule is applied). Accordingly, such orders and
suspension agreements do not prevent the importation of a
product, but rather require that either the product be priced at a
non-dumped level or without the benefit of subsidies, or that the
importer pays the difference between such dumped or
subsidized price and the actual price to the government as a
duty.
Safeguard measures are addressed more generally to a
particular product, irrespective of its country of origin, to protect
domestic production against serious injury caused by
unforeseen, sharp and sudden increase of imports.
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All WTO members are required to review anti-dumping duty and
countervailing duty orders every five years to determine if they
should be maintained, revised or revoked. This requires a
review of whether the dumping or subsidization is likely to
continue or recur if the order/suspension agreement is revoked
and whether a domestic industry in the country is likely to suffer
the continuation or recurrence of the injury within the reasonably
foreseeable future if the orders are revoked. If the government
finds dumping or subsidization and the injury is likely to continue
or recur, then the orders continue.
In the case of safeguard
measures imposed for a period exceeding three years, all WTO
members are required to conduct a mid-term review of the
imposed measures.
After a review, safeguard measures may be
extended if they continue to be required, but the total period for
the application of safeguard measures may not exceed eight
years.
In a number of markets in which ArcelorMittal has manufacturing
operations, it may be the beneficiary of trade actions intended to
address trade distortions consistent with WTO regulations, such
as the examples mentioned above. In other situations, certain
operations of ArcelorMittal may be a respondent to anti-dumping
and countervailing duty cases and its exported products might
be subject to anti-dumping and countervailing duties or other
trade restrictions.
USA Section 232:
On March 23, 2018, after national security investigation with
respect to steel imports (under Section 232 of the Trade
Expansion Act (“Section 232”)), the Trump Administration
imposed tariffs of 25% on steel products from all but a select list
of countries, with a temporary suspension applied for Canada,
Mexico, Argentina, South Korea, Brazil and the EU until May 1,
2018. Subsequently, Australia obtained a full exemption, and
imports from Argentina, Brazil and South Korea became subject
to annual quotas. Tariffs on imports of steel products from
Canada and Mexico were eliminated on May 17, 2019, which
led to positive impacts in the Company’s North America
business units; imports from Canada and Mexico were
monitored to identify whether imported volumes surged
meaningfully beyond historical levels.
Mexico’s Section 232 tariff
exemption was subsequently modified in July 2024 to apply only
to Mexican steel products melted and poured in North America.
On October 31, 2021, the United States and EU announced that
they had reached a two-year agreement to modify the Section
232 measures on U.S. steel imports from the EU, which was
further extended for another two years in December 2023.
Effective January 1, 2022, the U.S. replaced the existing Section
232 tariffs on EU steel with a tariff-rate quota ("TRQ") consistent
with pre-Section 232 trade volumes in return for the EU
dropping the threat of retaliatory tariffs. The total annual import
volume under the TRQ is set at 3.3 million tonnes allocated by
product category and on an EU member state basis
.
Only steel
“melted and poured” in the EU
is
eligible for duty-free treatment.
Imports abov
e the TRQ volumes will continue to be subject to
the 25% tariff. An additional 1.1 million tonnes of products
previously excluded from Section 232 tariffs are also allowed to
continue duty-free. Subsequently, the U.S. reached similar
agreements with Japan and the UK, also replacing the 25%
S
ection
232 tariffs with tariff-rate quotas. Those agreements
took effect on April 1, 2022 (Japan) and June 1, 2022 (UK).
In May 2022, the U.S. suspended Section 232 tariffs on imports
of steel from Ukraine. In May 2023, the suspension was
extended for an additional year and expanded to include steel
products from Ukraine further processed in the EU. In May
2024, the suspension and expansion were extended until June
1, 2025.
In February 2025, the U.S. administration announced that it
would reinstate 25% tariffs on all steel and aluminum imports
under Section 232, revoking previously negotiated country-
specific exemptions and quota arrangements from March 12,
2025 (including those described above).
The 2018 Section 232 tariffs triggered concerns of trade
deflection worldwide and several countries initiated domestic
remediation measures.
On February 2, 2019, the EU
Commission imposed definitive safeguard measures based on
global tariff quotas with a 100% quota based on average imports
over the past three years prior to 2018 and covering 26
steel
product categories
. Imports that exceeded the above quotas
would face a 25% tariff but certain 'developing' countries were
exempt when their respective import shares were below 3%.
The measures set country-based quotas for larger importers on
all product categories, except for hot rolled (global), and
quarterly quota calculations for residual volumes of all products.
They also included annual quota relaxations, adaptable to
market conditions. Countries subject to quotas have an
incentive to front-load the consumption of their national quota in
order to benefit from the residual quotas in the final quarter of
the period, thus ensuring full quota consumption.
In 2021, the EU Commission carried out a review resulting in a
three-year extension prolonging the measures until June 30,
2024. It was agreed to carry out a review of the quota levels
after one year and a review of the measures in general after two
years. The first of these reviews took place in 2022 and a further
review in 2023 confirmed the measures until June 2024.
Following a further review in the first half of 2024, the measures
were extended until June 30, 2026.
If the Section 232 tariffs are reinstated in full, the European
Union and other countries may implement counter measures in
response.
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Separately, from April 1, 2022, all Russian and Belarusian quota
volumes were redistributed across other country-specific quotas
and the residual quota based on 2021 imports
.
In 2024, the Commission extended anti-dumping measures on
corrosion-resistant steel from China for a further five years.
On April 30, 2024 a
n expiry review was opened by the
Commission into existing anti-dumping and anti-subsidy
measures on organic coated steel from China.
During 2024, the Commission also opened anti-dumping
investigations into hot-rolled coil from Japan, India, Egypt and
Vietnam, and tin plate from China. These investigations are
ongoing.
In January 2021, Turkey opened an investigation into HRC
coming from the EU and South Korea. The investigation led to a
10.9% duty being applied to imports from ArcelorMittal as from
July 7, 2022. In 2023, Turkey opened a safeguard investigation
into Wire Rod imports, imposing provisional measures while the
investigation is ongoing.
In 2022, the U.S. completed reviews of anti-dumping and
countervailing duty measures in place on corrosion-resistant,
cold-rolled, and hot-rolled steel, and cut-to-length steel plate,
continuing most duties for another five years.
In January 2023, the U.S. initiated an anti-dumping investigation
regarding tin mill products from eight countries, including
Canada. ArcelorMittal Dofasco was named as a respondent in
the case. In February 2024, a final decision confirmed that no
measures will be imposed on any of the targeted eight
countries.
In September 2024, the U.S. industry petitioned a new
Corrosion-Resistant anti-dumping case against ten countries,
and subsidy case against four countries. Canada and Mexico
were included in both allegations. In October 2024, the United
States International
Trade Commission ("ITC")
made a
preliminary injury determination against all ten countries. The
United States
Department of Commerce ("DOC")
and ITC final
injury phases
are expected to continue to the third quarter of
2025
.
In September 2024, the U.S. modified its tariff action in the
Section 301 investigation of China’s unfair trade practices,
increasing the section 301 tariffs on imports of Chinese steel
from 7.5% to 25%. The section 301 tariff is in addition to
applicable tariffs under Section 232 and existing anti-dumping
and countervailing duties. Duties were also increased on a
number of other products in strategic sectors, including electric
vehicles (duty of 100%).
In Canada, as a result of the opening of a safeguard
investigation on certain flat and long products, provisional
measures were put in place on October 25, 2018 in the form of
quotas and a 25% tariff on steel imports. Final safeguard
measures were subsequently implemented in relation to plate
and stainless wire, but not on rebar, hot rolled, prepaint, wire rod
and energy tubulars. In addition, twelve cold-rolled and
corrosion-resistant anti-dumping and countervailing duty
measures were implemented between 2018-2020 (CRS, COR,
COR2). In 2022, anti-dumping and countervailing duty
measures were initiated for hot-rolled from China, Brazil,
Ukraine and India under a five-year review (HRSS), while
Ukraine was removed from the measures.
In September 2024,
six cold-rolled anti-dumping and subsidy measures (CRS) were
continued for another five years, and
in
November 2024
,
Canada continued four corrosion-resistant anti-dumping
measures (COR) for another four years. In December 2024, the
Canadian Government self-initiated a new corrosion-resistant
anti-dumping measure (COR3) against Turkey (Borcelik), with
final determination expected in July 2025.
For rebar, nineteen anti-dumping and countervailing duty
measures were implemented between 2015 to 2021 (RB1-RB4),
with ten measures continued in two separate five-year reviews
in 2020 (RB1) and 2022 (RB2). In May 2024, a new rebar anti-
dumping case (RB5) was initiated against three countries and
implemented
in January 2025. Finally, a new wire rod anti-
dumping case against three countries (WR) was initiated in
March and implemented in October 2024.
In February 2024, the Canadian government announced
implementation of a “Country of Melted and Poured” steel import
monitoring system, with mandatory reporting effective
November 2024.
In addition, to align with the U.S. 301 duties on Chinese unfair
trade practices, the Canadian government implemented a
Section 53 surtax of 100% on Chinese electric vehicles,
effective October 1, 2024, and a 25% Section 53 surtax on
Chinese steel and aluminum, effective October 22, 2024. These
surtaxes are in addition to any duties or tariffs applicable to
Chinese steel and aluminum.
Key currency regulations and exchange controls
As a holding company, ArcelorMittal is dependent on the
industrial franchise fees from, earnings and cash flows of, and
dividends and distributions from, its operating subsidiaries to
pay expenses, meet its debt service obligations, pay any cash
dividends or distributions on its ordinary shares or conduct
share buy-backs. Significant cash or cash equivalent balances
may be held from time to time at subsidiaries where repatriation
of funds may be affected by tax and foreign exchange policies,
including in Argentina, Brazil, China, South Africa and Ukraine.
Such policies are briefly summarized below; however, none of
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these are currently significant in the context of ArcelorMittal’s
overall liquidity.
Argentina
The Argentinian foreign exchange market is regulated by the
Argentine Central Bank ("BCRA"), which has introduced
measures affecting the foreign exchange market since 2018 in
an effort to improve macroeconomic conditions and bring
stability to the country.
In December 2023, the government devalued the Argentine
peso ("ARS") against the U.S. dollar to establish an official
exchange rate of around 800 pesos per U.S. dollar. The
adjustment of the exchange rate was intended to serve as a
supplementary anchor for inflation expectations. B
ased on the
current situation, the exchange rate devaluation path is currently
set at 2% per month by the government.
Throughout 2024, the
BCRA actively intervened in both the official and parallel foreign
exchange markets, including by selling U.S. dollars in the
parallel market, in an effort to curb inflation, stabilize the
monetary base,
and close the gap between Argentina's official
peso exchange rate and the Blue Chip Swap (BCS) rate (a
parallel exchange rate)
. By December 2024, the gap had
narrowed significantly, reaching a historic low of around 1.45%.
Brazil
The Central Bank of Brazil ("BCB") operates, consistent with the
inflation targeting rate, a free floating foreign exchange regime
that aims to reduce excessive volatility,
although intervention
has become more regular in recent years. The BCB regulates all
currency inflows and outflows in Brazil, and the country's foreign
exchange regime does not permit free convertibility of the
currency. Nevertheless, the BCB does not directly determine the
exchange rate
. The Brazilian Real is fully deliverable onshore
(i.e., physical settlement of the designated currency at maturity),
but is non-deliverable offshore. As a result, foreign currency
transactions must be executed with an institution authorized by
the BCB to carry out such transactions, which is responsible for
ensuring compliance with the local foreign exchange regulation.
With proper documentation, the repatriation of registered
invested capital and remittance of profits do not require prior
approval from the BCB. Profits can be freely remitted as
dividends or as interest on capital to foreign shareholders or
portfolio investors.
China
China’s foreign exchange regime has undergone significant
liberalization in recent years. The People’s Bank of China
("PBOC") maintains the Chinese renminbi in a managed float
with reference to a basket of currencies. The CNY, which refers
to the Chinese renminbi on the onshore market, is partially
convertible and has a non-deliverable offshore market. CNY
foreign currency spot transactions under $50,000 per year do
not require supporting documents. All onshore transactions
involving foreign exchange are strictly controlled by the State
Administration of Foreign Exchange. The foreign currency
exchange fixing rate is announced every morning at 9:15 Beijing
time, and the interbank market is only allowed to trade within 2%
of the fixing rate for onshore CNY versus U.S. dollar. Since
2021, repatriating capital or profits out of China includes
increased layers of inspection and security from the
government. The PBOC has decided to increase the amount of
foreign-currency deposits that financial institutions need to hold
as reserves, as from June 2021, in order to curb sell-offs of
foreign currencies after the renminbi's value climbed to a record
high. The CNH, which is the Chinese renminbi traded offshore,
became deliverable in Hong Kong in July 2010. The CNH can
generally be transferred freely between offshore accounts and
interaction with the onshore market is growing, although
transfers of CNH from Hong Kong to onshore China are subject
to regulations and approval by the PBOC. Moreover, in July
2020, integration of the interbank and exchange bond markets,
as well as wider participation in the treasury bond futures
market, suggest that more progress is likely to be made by the
PBOC to move toward increased internalization of the Chinese
market.
India
The Reserve Bank of India ("RBI") maintains the Indian rupee
(“INR”) in a managed floating regime. The INR is partially
convertible and has a non-deliverable offshore market. Onshore
deliverable forwards are also available out to 10 years. The
most common and liquid tenor in the forwards market is one
year or less. The RBI monitors the value of the INR against the
REER (Real Effective Exchange Rate). The INR exchange rate
is determined in the interbank foreign exchange market. The
INR is convertible for exports and imports of goods and services
as well as unilateral transfers, including repatriating profits from
foreign-funded companies, as well as for daily recurring
transactions in the ordinary course of business. However, the
INR is restricted on capital accounts (purchase and sale
transactions of foreign assets and liabilities) and there are
specific transactions that have to be authorized by the RBI or
other relevant government departments for routine capital
account transactions, e.g. foreign currency borrowings under the
approval route or foreign direct investments that are not
permitted under the automatic route. A daily benchmark fixing is
published by the Financial Benchmark of India Limited for INR
against U.S. dollar, EUR, JPY and GBP. Other permitted capital
account transactions that are allowed, subject to compliance
with local applicable regulations, include foreign direct
investment, foreign currency loans and bonds, securities and
equity investments overseas.
South Africa
The South African Reserve Bank ("SARB") operates a managed
floating exchange rate system. The South African rand (“ZAR”)
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Management report
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is deliverable and largely convertible, and the SARB is gradually
relaxing exchange rate controls. The currency is deliverable and
traded out to 10 years, although liquidity is highest in tenors of
two years or less. Since January 1, 2014, companies may apply
for approval to establish a holding company to hold their
offshore investments. Subject to certain conditions, listed
companies may place ZAR 5 billion per year with such holding
companies, which can be transferred offshore without exchange
control approval, and unlisted companies may transfer ZAR 3
billion per yea
r. All funds transf
erred into or out of South Africa
must be declared to the SARB. Active currency hedging with
maturity of more than 12 months requires documentary
evidence of firm and ascertainable commitment. In most cases,
there are no restrictions on capital inflows. However, all
incoming loans are subject to the SARB’s approval and
institutions’ overseas investments are restricted to 25% of retail
assets for retirement funds and long-term insurers.
Ukraine
The National Bank of Ukraine ("NBU") is responsible for the
country’s monetary policy. Due to the ongoing war with Russia
since the end of February 2022, on shore liquidity on Ukrainian
Hryvnya has been significantly reduced, leading to the NBU
implementing strong regulation to control foreign exchange
transactions.
As of 2024, the National Bank of Ukraine (NBU) has introduced
important updates to its foreign exchange regulations. These
updates include easing restrictions on import payments and
dividend repatriation, permitting currency transfers for
international technical assistance, and facilitating VAT payments
for e-commerce within the EU. Additionally, new limits have
been set to reduce unproductive capital outflows, and
restrictions on using foreign currency loans for purchasing
securities have been tightened. These measures aim to
maintain economic stability, support business operations, and
effectively manage foreign currency
reserves
.
Disclosure pursuant to Section 219 of the Iran Threat Reduction
& Syria Human Rights Act (ITRA) regarding ArcelorMittal’s
business with customers in Iran
Section 219 of the Iran Threat Reduction and Syria Human
Rights Act of 2012 added Section 13(r) to the U.S. Securities
Exchange Act of 1934, as amended (the Exchange Act).
Section 13(r) requires an issuer to disclose in its annual reports
whether it or any of its affiliates knowingly engaged in certain
activities, transactions or dealings relating to Iran. Disclosure is
required even where the activities, transactions or dealings are
conducted outside the United States by non-US persons in
compliance with applicable law, and whether or not the activities
are sanctionable under U.S. law.
In 2024, neither ArcelorMittal nor any of its affiliates engaged in
activities, transactions or dealings relating to Iran requiring
disclosure under Section 13(r).
ArcelorMittal continues to monitor developments in this area, in
particular the status of U.S. sanctions, the Joint Comprehensive
Plan of Action ("JCPOA") and EU sanctions, and the expansion
of the EU Blocking Regulation (Council Regulation (EC)
2271/96). ArcelorMittal carefully monitors political risk and
sanctions exposure and has procedures and systems in place
intended to manage those risks.
However, ArcelorMittal’s business is subject to an extensive,
complex and evolving regulatory framework. It is possible that
ArcelorMittal may face conflicting obligations or risks under U.S.
direct and secondary sanctions and the EU Blocking Regulation,
or other conflicting instruments. Despite its governance,
compliance policies and procedures and continuous efforts to
comply with all applicable sanctions regimes, its systems and
procedures may not always prevent the occurrence of violations
which may lead to regulatory penalties or cause reputational
harm to operating subsidiaries, joint ventures or associates. See
“Introduction—Risk Factors and Control.”
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Management report
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Organizational structure
ArcelorMittal is a holding company with no business operations of its own. All of ArcelorMittal’s
significant
operating subsidiaries are indirectly owned by
ArcelorMittal
through
intermediate holding companies. The following chart represents the
operational
structure of the Company, in
cluding ArcelorMittal’s significant operating subsidiaries
or business
divisions and not its legal
or ownership
structure
.
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Please refer to the "Glossary
—
definitions, terminology and
principal subsidiaries" for a listing of the Company’s principal
subsidiaries, including country of incorporation. Please refer to
note 2.2.1 of the consolidated financial statements for the
ownership percentages of these subsidiaries. Unless otherwise
stated, the subsidiaries as listed have share capital consisting
solely of ordinary shares, which are held directly or indirectly by
the Company and the proportion of ownership interests held
equals to the voting rights held by the Company.
Investments in joint ventures
ArcelorMittal has investments in joint ventures accounted for
under the equity method as detailed in note 2.4 to ArcelorMittal’s
consolidated financial statements. See section “Property, plant
and equipment—Investments in joint ventures” for further
details.
Reportable segments
ArcelorMittal reports its business in the following six r
eportable
segments
corresponding to continuing activities: North America,
Brazil, Europe, India and joint ventures ("JVs"), Sustainable
Solutions and Mining. The Company's
operation
s in South Africa
and Ukraine are included in
Others.
As from January 1, 2024, ArcelorMittal implemented changes to
its organizational structure. India and JVs are reported as a new
operating segment that includes the joint ventures AMNS India,
VAMA and AMNS Calvert, as well as other associates, joint
ventures and other investments. The segment Sustainable
Solutions is composed of a number of businesses playing an
important role in supporting climate action (including
renewables, special projects and construction business). Such
businesses were previously reported within the Europe segment
and are now reported as a separate operating segment. The
NAFTA segment has been renamed North America. Finally,
following the sale of the Company’s operations in Kazakhstan,
the remaining parts of the former ACIS segment w
ere
assigned
to
Others.
North America produces flat, long and tubular products. Flat
products include slabs, hot rolled coil, cold rolled coil, coated
steel products and plate and are sold primarily to customers in
the following sectors: automotive, energy, construction,
packaging and appliances and via distributors and processors.
Flat product facilities are located at two integrated and mini-mill
sites located in two countries. Long products include wire rod,
sections, rebar, billets, blooms and wire drawing. Long
production facilities are located at two integrated and mini-mill
sites located in two countries.
In 2024, shipments from North
America totaled
10.1
million tonnes (10.6 million tonnes in
2023).
The raw material supply of the North America operations
includes sourcing from iron ore captive mines in Mexico to
supply the steel facilities.
B
razil produces flat, long and tubular products. Flat products
include slabs, hot rolled coil, cold rolled coil and coated steel.
Long products comprise sections, wire rod, bar and rebars,
billets and wire drawing
. These products are sold primarily to
customers in the construction, power generation and
agribusiness sectors, as well as in the automotive and
household appliances industries. In 2024, shipments from Brazil
totaled
14.1
million tonnes (13.7 million tonnes in 2023).
The
raw material supply of the Brazil operations includes sourcing
from iron ore captive mines in Brazil.
Europe produces flat and long products. Flat products include
hot rolled coil, cold rolled coil, coated products, tinplate, plate
and slab. These products are sold primarily to customers in the
automotive, general industry and packaging sectors. Flat
product facilities are located at 8 integrated and mini-mill sites
located in five countries. Long products include sections, wire
rod, rebar, billets, blooms and wire drawing. Long product
facilities are located at 10 integrated and mini-mill sites in seven
countries. In 2024, shipments from Europe totaled
28.7
million
tonnes (
27.6
million tonnes in 2023).
The raw material supply of
Europe operations includes sourcing from iron ore captive mines
in Bosnia & Herzegovina.
India and JVs includes all of the Company's interests in joint
ventures, associates and other investments. The Company
believes
India is a high growth vector, with its JV assets well-
positioned to grow with the domestic market.
Sustainable Solutions
is composed of a number of niche capital-
light businesses that play an important role in supporting climate
action (including renewables, special projects and construction
business) and which ArcelorMittal believes have high growth
potential. It is also
an in-house trading and distribution arm of
ArcelorMittal w
hich provides primarily distribution of long and flat
products as well as
value-added and customized steel solutions
through further steel processing to meet specific customer
requirements.
It is a growth vector of the Company and
represents more than
300
commercial and production sites
across more than
60
countrie
s.
Mining provides the Company's steel operations with high
quality and low-cost iron ore reserves and also sells mineral
products to third parties. Mining segment iron ore mines are
located
in North America and Africa.
In 2024, iron ore production
in the M
ining
segment totaled approximately
27.9
million tonnes
(26.0 million tonnes in 2023).
PROPERTIES AND CAPITAL EXPENDITURES
Property, plant and equipment
ArcelorMittal has steel production facilities, as well as iron ore
mining operations, in North and South America, Europe, Asia
and Africa.
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All of ArcelorMittal's operating subsidiaries are substantially
owned by ArcelorMittal through intermediate holding companies,
and
are grouped into the five reportable segments and Others
as described above (excluding India and JVs).
Unless otherwise
stated, ArcelorMittal owns all of the assets described in this
section. Regarding ArcelorMittal's iron ore mines, see also "—
Mineral reserves and resources" below, where information is
provided in accordance with SEC Regulation S-K, Subpart 1300
(“S-K 1300”).
For further information on environmental issues that may affect
ArcelorMittal’s utilization of its assets, see “Business overview—
Government regulations”
and notes 1.2 and 9.1 to
ArcelorMittal’s consolidated financial statements.
Steel production facilities of ArcelorMittal
The following table provides an overview by type of steel facility
of the principal production units of ArcelorMittal’s operations.
While all of the Group’s facilities are shown in the tables, only
the facilities of principal operating subsidiaries are described
textually for each segment. The facilities included in the tables
are listed from upstream to downstream in the steel-making
process.
|
Facility
|
Number of
Facilities
|
Capacity (in million tonnes per
year)
1
|
Production in 2024
(in million tonnes)
2
|
|||
|
Coke Oven Battery
|
37
|
21.1
|
15.1
|
|||
|
Sinter Plant
|
19
|
73.6
|
41.8
|
|||
|
Blast Furnace
|
32
|
60.9
|
41.6
|
|||
|
Basic Oxygen Furnace (including Tandem Furnace)
|
43
|
67.2
|
44.2
|
|||
|
DRI/HBI Plant
|
11
|
10.3
|
6.2
|
|||
|
Electric Arc Furnace
|
28
|
24.0
|
14.7
|
|||
|
Continuous Caster—Slabs
|
26
|
57.4
|
40.6
|
|||
|
Hot Rolling Mill
|
13
|
49.2
|
32.4
|
|||
|
Pickling Line
|
19
|
21.8
|
9.9
|
|||
|
Tandem Mill
|
23
|
26.1
|
16.5
|
|||
|
Annealing Line (continuous / batch)
|
22
|
10.0
|
5.2
|
|||
|
Skin Pass Mill
|
15
|
9.0
|
3.9
|
|||
|
Plate Mill
|
5
|
1.7
|
0.8
|
|||
|
Continuous Caster—Bloom / Billet
|
30
|
30.1
|
16.9
|
|||
|
Breakdown Mill (Blooming / Slabbing Mill)
|
1
|
6.0
|
0.4
|
|||
|
Billet Rolling Mill
|
3
|
2.6
|
0.9
|
|||
|
Section Mill
|
21
|
12.1
|
5.1
|
|||
|
Bar Mill
|
17
|
7.4
|
4.7
|
|||
|
Wire Rod Mill
|
16
|
10.5
|
5.7
|
|||
|
Hot Dip Galvanizing Line
|
39
|
15.7
|
11.8
|
|||
|
Electro Galvanizing Line
|
6
|
1.5
|
0.7
|
|||
|
Tinplate Mill
|
9
|
2.0
|
1.1
|
|||
|
Color Coating Line
|
15
|
2.5
|
1.5
|
|||
|
Seamless Pipes
|
3
|
0.4
|
0.1
|
|||
|
Welded Pipes
|
87
|
3.4
|
0.9
|
1.
Reflects design capacity and does not take into account other constraints in the production process (such as, upstream and downstream bottlenecks and product mix
changes). As a result, in some cases, design capacity may be different from the current achievable capacity.
2.
Production facility details include the production numbers for each step in the steel-making process. Output from one step in the process is used as input in the next step
in the process. Therefore, the sum of the production numbers does not equal the quantity of sellable finished steel products.
|
Crude steel production by process in 2024 (in million tonnes)
|
|||
|
Segment
|
Basic oxygen furnace
|
Electric arc furnace
|
Total
|
|
North America
|
2.5
|
5.0
|
7.5
|
|
Brazil
|
11.1
|
3.5
|
14.6
|
|
Europe
|
25.7
|
5.5
|
31.2
|
|
Sustainable Solutions and Others
|
4.2
|
0.4
|
4.6
|
|
Total
|
43.5
|
14.4
|
57.9
|
62
|
Management report
|
|
Blast furnace and electric arc furnace facilities
|
||
|
Segment
|
Blast furnaces
|
Electric arc furnaces
|
|
North America
|
3
|
8
|
|
Brazil
|
7
|
7
|
|
Europe
|
15
|
10
|
|
Sustainable Solutions
|
—
|
3
|
|
Others
|
7
|
—
|
|
Total
|
32
|
28
|
|
North America
|
Crude Steel
|
|||||||
|
Unit
|
Country
|
Locations
|
Production in 2024
(in million tonnes per year)
1
|
Type of plant
|
Products
|
|||
|
ArcelorMittal Dofasco
2
|
Canada
|
Hamilton
|
3.1
|
Integrated, Mini-mill
|
Flat
|
|||
|
ArcelorMittal Texas HBI
|
USA
|
Corpus Christi
|
n/a
|
Iron-Making
|
Hot briquetted iron
|
|||
|
ArcelorMittal Mexico
|
Mexico
|
Lázaro Cárdenas, Celaya
|
2.5
|
Mini-mill, Integrated,
and Downstream
|
Flat, Long/ Bar, Wire
Rod
|
|||
|
ArcelorMittal Long Products Canada
|
Canada
|
Contrecoeur East, West
|
1.9
|
Mini-mill
|
Long/ Wire Rod, Bars,
Slabs
|
|||
|
ArcelorMittal Tubular Products
|
Canada
|
Brampton
|
n/a
|
Downstream
|
Pipes and Tubes
|
|||
|
ArcelorMittal Tubular Products
|
Canada
|
London
|
n/a
|
Downstream
|
Pipes and Tubes
|
|||
|
ArcelorMittal Tubular Products
|
Canada
|
Woodstock
|
n/a
|
Downstream
|
Pipes and Tubes
|
|||
|
ArcelorMittal Tubular Products
|
Canada
|
Hamilton
|
n/a
|
Downstream
|
Pipes and Tubes
|
|||
|
ArcelorMittal Tubular Products
|
USA
|
Shelby
|
n/a
|
Downstream
|
Pipes and Tubes
|
|||
|
ArcelorMittal Tubular Products
|
USA
|
Marion
|
n/a
|
Downstream
|
Pipes and Tubes
|
|||
|
ArcelorMittal Tubular Products
|
Mexico
|
Monterrey
|
n/a
|
Downstream
|
Pipes and Tubes
|
|||
|
ArcelorMittal Calvert
|
USA
|
Calvert
|
n/a
|
Downstream
|
Flat
|
|
Captive mining operations
|
||||||||||
|
Unit
|
Country
|
Locations
|
ArcelorMittal
Interest (%)
|
Type of Mine
|
Product
|
|||||
|
ArcelorMittal Mexico (excluding
Peña Colorada)
3
|
Mexico
|
Michoacán
|
100.0
|
Iron Ore Mine (open pit)
|
Concentrate, lump and
fines
|
|||||
|
ArcelorMittal Mexico Peña Colorada
|
Mexico
|
Minatitlán (Colima)
|
50.0
|
Iron Ore Mine (open pit)
|
Concentrate and
pellets
|
1.
n/a = not applicable (no crude steel production).
2.
ArcelorMittal Dofasco permanently idled its batch annealing lines #1 and #2 in 2024.
3.
Operations at the San Jose mine were discontinued in the second quarter of 2024.
ArcelorMittal Dofasco
ArcelorMittal Dofasco (“Dofasco”) is a leading North American
steel solution provider and Canada’s largest manufacturer of flat
rolled steels. Dofasco’s steel-making plant in Hamilton, Ontario
is adjacent to water, rail and highway transportation. The plant
uses both integrated and EAF-based steelmaking processes. Its
products include hot rolled coils, cold rolled coils, galvanized
steels and tinplate. Dofasco supplies these products to the
automotive, construction, packaging, manufacturing, pipe and
tube and steel distribution markets.
Dofasco
is currently in the process of reviewing its
decarbonization
project in a low-carbon emissions steelmaking
facility at its plant in Hamilton. The project is currently
progressing through FEED stage.
Following the completion in 2022 of the hot strip mill
modernization project (to install two new state-of-the-art coilers
and runout tables to replace three end-of-life coilers as well as
to upgrade the strip cooling system) and the #5 CGL conversion
to AluSi® project (addition of up to 160,000 tonnes per year
Aluminum Silicon (AluSi®) coating capability to #5 Hot-Dip
Galvanizing Line for the production of Usibor® steels), the first
commercialized coil was delivered in the second half of 2023
and commercialization was fully completed in the first half of
2024.
ArcelorMittal Texas HBI
On June 30, 2022, ArcelorMittal completed the acquisition of an
80% shareholding in voestalpine’s HBI plant located near
Corpus Christi, Texas.
The state-of-the-art plant, which was
opened in October 2016, is one of the largest of its kind in the
world and
produces Hot Briquetted Iron ("HBI"), a high quality
feedstock made through the direct reduction of iron ore which is
63
|
Management report
|
used to produce high-quality steel grades in an EAF, but it can
also be used in blast furnaces, resulting in lower coke
consumption.
The
facility includes its own deep-water port, and
unused land on the site which provides options for further
development.
ArcelorMittal Mexico
ArcelorMittal Mexico produces both flat and long steel products
and operates an integrated route and EAF route using DRI. It
produces higher quality slabs for use in specialized steel
applications in the automotive, line pipe manufacturing,
shipbuilding and appliance industries. It is also one of the
largest single rebar and wire rod production facilities in Mexico
and mainly uses the integrated route for steelmaking. The
facility is located in
Lázaro Cárdenas
in the Michoacán state by
the Pacific coast and is highly accessible by ocean, rail, and
other means. It also operates a rebar mill at Celaya with billets
sourced from the Lazaro facility.
The new hot strip mill produced its first coils in December 2021.
R
amp-up is underway and is on track with capacity utilization
having reached approximately
67%
in the fourth quarter of
2024
.
A
rcelorMittal Calvert
On February 6, 2025, ArcelorMittal announced a project to
construct an advanced manufacturing facility for non-grain
oriented electrical steel (NOES) in Calvert, Alabama,
with
estimated n
et capital expenditure of $0.9 billion ($1.2 billion
before the impact of currently planned federal, state and local
support)
s
ee "Introduction—Sustainable development
highlights".
Peña Colorada
Consorcio Minero Benito Juarez Peña Colorada, S.A. de C.V.
("Peña Colorada") is a 50/50 joint operation between
ArcelorMittal and Ternium S.A. ("Ternium") and operates an
open pit iron ore mine in the province of Minatitlán in the
northwestern part of the State of Colima, Mexico. It also
operates a concentrating facility and a two-line pelletizing
facility. The beneficiation plant is located at the mine, whereas
the pelletizing plant is located in Manzanillo. The magnetite
concentrate produced at the mine is shipped from Manzanillo to
ArcelorMittal Mexico, as well as to Ternium’s steel plants by ship
and by rail.
El Volcan & San José
ArcelorMittal's San José and El Volcan iron ore mines in the
state of Sonora, Mexico stopped production in 2019
and 2024,
respectively,
due to depletion of reserves and are accordingly no
longer in operation.
Las Truchas
ArcelorMittal operates the Las Truchas iron ore mine located
approximately 27 kilometers north-west of the town of Lázaro
Cárdenas in the State of Michoacán, Mexico. The concentrated
ore is pumped from the mine site through a slurry pipeline to the
steel plant facility in Lázaro Cárdenas.
ArcelorMittal has progressed on its project to increase pellet
feed production at Las Truchas mine to 2.3 million tonnes per
annum with DRI concentrate grade capability. This project will
enable concentrate production for the BF route and DRI route,
with the goal of supplying ArcelorMittal Mexico's steel operations
with high quality feed. Production is expected to start in the first
half of 2026. See "—Capital expenditures".
For further details on ArcelorMittal Mexico mining assets
production and other related information, see "—Mineral
reserves and resources".
AMLPC
AMLPC is the largest mini-mill in Canada and has the flexibility
to use either DRI or scrap, depending on their respective
economics. It produces wire rods, wire products and bars,
primarily sold in Canada and the United States and principally
serves the automotive, appliance, transportation, machinery and
construction industries. It also produces slabs that are used
within ArcelorMittal.
64
|
Management report
|
|
BRAZIL
|
Crude Steel
|
|||||||||
|
Unit
|
Country
|
Locations
|
Production in 2024
(in million tonnes per
year)
1
|
Type of plant
|
Products
|
|||||
|
Sol
|
Brazil
|
Vitoria
|
n/a
|
Coke-Making
|
Coke
|
|||||
|
ArcelorMittal Tubarão
|
Brazil
|
Vitoria
|
6.9
|
Integrated
|
Flat
|
|||||
|
ArcelorMittal Vega
2
|
Brazil
|
São Francisco do Sul
|
n/a
|
Downstream
|
Flat
|
|||||
|
ArcelorMittal Brasil
|
Brazil
|
João Monlevade
|
1.1
|
Integrated
|
Long/ Wire Rod
|
|||||
|
ArcelorMittal Brasil
|
Brazil
|
Juiz de Fora, Piracicaba
|
1.9
|
Mini-mill
|
Long/ Bar, Wire Rod
|
|||||
|
ArcelorMittal Brasil
|
Brazil
|
Barra Mansa,
Resende
|
0.9
|
Mini-mill
|
Long/Rebar, Wire rod, Bars,
Sections, Wires
|
|||||
|
ArcelorMittal Pecém
|
Brazil
|
Pecém
|
3.0
|
Integrated
|
Flat
|
|||||
|
Acindar
3
|
Argentina
|
Villa Constitucion
|
0.7
|
Mini-mill
|
Long/ Wire Rod, Bar
|
|||||
|
ArcelorMittal Costa Rica
|
Costa Rica
|
Costa Rica
|
n/a
|
Downstream
|
Long/ Wire Rod
|
|||||
|
Industrias Unicon
|
Venezuela
|
Barquisimeto, Matanzas,
La Victoria
|
n/a
|
Downstream
|
Pipes and Tubes
|
|
Captive mining operations
|
||||||||||
|
Unit
|
Country
|
Locations
|
ArcelorMittal
Interest (%)
|
Type of Mine
|
Product
|
|||||
|
ArcelorMittal Brasil Andrade Mine
|
Brazil
|
State of Minas Gerais
|
100.0
|
Iron Ore Mine (open pit)
|
Fines
|
|||||
|
ArcelorMittal Mineração Serra Azul
|
Brazil
|
State of Minas Gerais
|
100.0
|
Iron Ore Mine (open pit)
|
Lump and fines
|
1.
n/a = not applicable (no crude steel production).
2.
ArcelorMittal Vega commissioned a
new hot dip galvanizing and annealing combiline in June 2024 in the framework of the expansion project.
3.
Acindar commissioned a new hot dip galvanizing line in February 2024, which allowed for the dismantling the two old electro-galvanizing lines (LG-2 and LG-5) in
December and May 2024, respectively.
ArcelorMittal Brasil
ArcelorMittal Brasil produces both flat and long steel products.
Flat products are manufactured at ArcelorMittal Tubarão,
ArcelorMittal Pecém and ArcelorMittal Vega. Its products include
slabs, hot rolled coil, cold rolled coil and galvanized steel, and
serve customers in automotive, appliances, construction and
distribution segments. The Tubarão complex uses the integrated
steelmaking route to produce slabs and rolling hot rolled coils
and is strategically located with access to the Praia Mole Marine
Terminal as well as road and railway systems. The Vega facility
has cold rolling and coating facilities and easy access to the port
of São Francisco do Sul. The Vega expansion project was
completed in the second quarter of 2024 and is currently
ramping up
. The first cold rolled annealed coil was produced in
the new continuous galvanizing and annealing combiline on
June 19, 2024, followed by first coated coil on July 15, 2024 and
first Magnelis coil on September 10, 2024. See "—Capital
expenditures".
A project is under development to construct a new high added
value finishing line (cold rolling mill) and a continuous coating
line at Tubarão facility. The project is undergoing internal
approvals, and ArcelorMittal Brasil is currently moving forward
with detailed engineering (full feasibility study).
The Pecém facility
located in the state of Ceará in northeast
Brazil was commissioned in 2016 and acquired by ArcelorMittal
in 2023.
It uses the integrated steelmaking route to produce
slabs
and has access via conveyors to the Port of Pecém, a
large-scale, deepwater port located 10 kilometers from the plant.
ArcelorMittal Brasil’s long products include wire rod and wire,
sections, merchant bars, special bars and rebars, for use in civil
construction, industrial manufacturing, agricultural and
distribution sectors. It produces transformed products including,
among others, welded mesh, trusses, annealed wire and nails. It
owns upstream and downstream steel facilities in Monlevade,
Juiz de Fora, Piracicaba, Barra Mansa and Resende and
operates an extensive distribution network across the country
selling to retail customers. It owns interests in two subsidiaries,
Belgo Bekaert Arames Ltda. ("BBA"), which manufactures wire
products for agricultural and industrial end-users, and Belgo-
Mineira Bekaert Artefatos de Arame Ltda., which produces steel
cords used in the tire industry. ArcelorMittal Brasil also owns
forests, and its subsidiary ArcelorMittal Bioflorestas produces
charcoal from eucalyptus forestry operations that is used to fuel
its furnaces in Juiz de Fora and to exchange for pig iron with
local producers.
The investment in a new sections mill at Barra Mansa
commenced in the first quarter of 2022 and is expected to
complete in the second half of 2025. See "—Capital
expenditures".
65
|
Management report
|
The upstream expansion project in Monlevade was cancelled
in
the fourth quarter of 2024 due to the economic situation in Brazil
and high steel imports.
The Company is currently exploring
lower capital intensive options.
Acindar
Acindar is the largest long steel producer in Argentina. It
manufactures and distributes products to meet the needs of the
construction, industrial, and agricultural sectors. It produces
rebars, square, round, drawn and flat bars, meshes, nails,
preassembled and welded cages, structural sections, piles, wire
rod and barbed wire. It has an in-house distribution network that
serves end-users across Argentina.
ArcelorMittal Brasil - Andrade Mine
ArcelorMittal Brasil operates the Andrade iron ore mine located
approximately 80 kilometers east of Belo Horizonte in the Minas
Gerais State of Brazil. In addition to the open pit mine,
ArcelorMittal operates a crushing, screening and concentration
facility. Fine material produced at the mine is transported to the
Monlevade plant through a private railway line.
ArcelorMittal Brasil - Serra Azul Mine
ArcelorMittal Brasil operates the Serra Azul iron ore mine
located approximately 50 kilometers southwest of the town of
Belo Horizonte in the Minas Gerais State of Brazil. ArcelorMittal
operates an open pit mine and a concentrating facility at the
site. Iron ore product is shipped mainly to the ArcelorMittal Brasil
integrated plants and to the local Brazilian market.
ArcelorMittal Serra Azul mine has a project to construct new
facilities to produce 4.5 million tonnes per annum of DRI quality
pellet feed, which is expected to be completed in
the second
half of 2025
; see "—Capital expenditures".
For
further details on Brazil mining assets, production and other
related information, see "—Mineral reserves and resources".
|
EUROPE
|
Crude Steel
|
|||||||||
|
Unit
|
Country
|
Locations
|
Production in 2024
(in million tonnes per
year)
1
|
Type of plant
|
Products
|
|||||
|
ArcelorMittal Bremen
|
Germany
|
Bremen, Bottrop
|
3.1
|
Integrated
|
Flat, Coke
|
|||||
|
ArcelorMittal Eisenhüttenstadt
|
Germany
|
Eisenhüttenstadt
|
1.8
|
Integrated
|
Flat
|
|||||
|
ArcelorMittal Belgium
|
Belgium
|
Ghent, Geel, Genk, Liège
|
5.2
|
Integrated and
Downstream
|
Flat
|
|||||
|
ArcelorMittal France
|
France
|
Dunkirk,
Mardyck,
Montataire,
Desvres,
Florange, Mouzon,
Basse-Indre
|
4.8
|
Integrated and
Downstream
|
Flat
|
|||||
|
ArcelorMittal Méditerranée
2,3
|
France
|
Fos-sur-Mer,
Saint-Chély
|
1.9
|
Integrated and
Downstream
|
Flat
|
|||||
|
ArcelorMittal España
|
Spain
|
Avilés, Gijón, Etxebarri,
Lesaka, Sagunto
|
3.6
|
Integrated and
Downstream
|
Flat, Long/ Rails, Wire Rod,
Plates
|
|||||
|
ArcelorMittal Avellino &
Canossa
|
Italy
|
Avellino
|
n/a
|
Downstream
|
Flat
|
|||||
|
ArcelorMittal Poland
4
|
Poland
|
Kraków, Swietochlowice,
Dabrowa Gornicza,
Chorzow,
Sosnowiec,
Zdzieszowice
|
3.8
|
Integrated and
Downstream
|
Flat, Coke, Long/ Sections,
Wire Rod, Sheet Piles, Rails
|
|||||
|
ArcelorMittal Sestao
|
Spain
|
Bilbao
|
0.5
|
Mini-mill
|
Flat
|
|||||
|
ArcelorMittal Belval & Differdange
|
Luxembourg
|
Esch-Belval, Differdange,
Rodange
|
1.9
|
Mini-mill
|
Long/ Sheet Piles, Rails,
Sections & Special Sections
|
|||||
|
ArcelorMittal Olaberria-Bergara
|
Spain
|
Olaberría, Bergara
|
1.0
|
Mini-mill
|
Long/ Sections
|
|||||
|
ArcelorMittal Gandrange
|
France
|
Gandrange
|
n/a
|
Downstream
|
Long/ Wire Rod, Bars
|
|||||
|
ArcelorMittal Warszawa
|
Poland
|
Warsaw
|
0.5
|
Mini-mill
|
Long/ Bars
|
|||||
|
ArcelorMittal Hamburg
|
Germany
|
Hamburg
|
0.8
|
Mini-mill
|
Long/ Wire Rods
|
|||||
|
ArcelorMittal Duisburg
|
Germany
|
Ruhrort, Hochfeld
|
1.0
|
Integrated
|
Long/ Billets, Wire Rod
|
|||||
|
ArcelorMittal Hunedoara
|
Romania
|
Hunedoara
|
0.1
|
Mini-mill
|
Long/ Sections
|
|||||
|
Sonasid
|
Morocco
|
Nador, Jorf Lasfar
|
0.7
|
Mini-mill
|
Long/ Wire Rod, Bars, Rebars
in Coil
|
|||||
|
ArcelorMittal Zenica
|
Bosnia and
Herzegovina
|
Zenica
|
0.5
|
Mini-mill / Integrated
|
Long/ Wire Rod, Bars
|
66
|
Management report
|
|
Captive mining operations
|
||||||||||
|
Unit
|
Country
|
Locations
|
ArcelorMittal
Interest (%)
|
Type of Mine
|
Product
|
|||||
|
ArcelorMittal Prijedor
|
Bosnia and
Herzegovina
|
Prijedor
|
51.0
|
Iron Ore Mine (open pit)
|
Concentrate and lump
|
1.
n/a = Not applicable (no crude steel production).
2.
Blast furnace #1 at Fos-sur-Mer was idled in September 2023 due to low market demand. It remained idle during 2024.
3.
Coke oven battery 3 at Fos-sur
-Mer was permanently closed in April 2024. Coke oven battery 2 has been hot idled (with natural gas injection) since the second quarter
of 2024 and will be permanently closed during 2025.
4.
Coke oven battery in Kraków was permanently closed in July 2024, and coke oven battery 6 at Zdzieszowice plant was closed in December 2024.
ArcelorMittal France
ArcelorMittal France has locations in Dunkirk, Mardyck,
Montataire, Desvres, Florange, Mouzon and Basse-Indre.
The
sites of ArcelorMittal France produce and market a wide range
of flat steel products, including slabs,
hot rolled and pickled
coils, as well as
high-value finished products, such as cold
rolled, hot dip galvanized, aluminized and organic coated
material, tinplate, draw wall ironed tinplate ("DWI") and tin free
steel.
ArcelorMittal France’s products are sold principally in the
regional market in France and Western Europe.
Certain of its
products are designed for the automotive market, such as
Ultragal®, Extragal®, Galfan, Usibor® (hot dip galvanized),
while others are designed for the consumer goods and
appliances market, such as Solfer® (cold rolled) for enameling
applications, as well as
packaging market.
The Dunkirk site has primary facilities and produces slabs as
well as hot rolled coils for other ArcelorMittal France sites.
The Mardyck site close to Dunkirk has finishing facilities and
supplies the hot dip coating lines of Montataire.
ArcelorMittal is
building a new production unit for electrical steels at its Mardyck
site; s
ee
"—Capital expenditures".
The Florange site supplies through its hot strip mill and 2 cold
rolling mills: the 2 hot dip coating lines of Florange (GALSA 1
and 2), the continuous annealing line of Florange, the hot dip
coating lines of Mouzon, as well as the tinplate facilities of
Florange and Basse-Indre. Mouzon is specialized in finishing
hot dip coating operations.
The site of Basse-Indre specializes
in packaging activities.
ArcelorMittal Belgium
ArcelorMittal Ghent
ArcelorMittal Ghent is a fully integrated steel plant which is
located along the Ghent-Terneuzen canal, approximately 17
kilometers from the Terneuzen sea lock, which links the works
directly with the North Sea. The canal is of the Panamax type
and can accommodate ships of up to 65,000 tonnes.
ArcelorMittal Ghent produces high added-value flat steel
products. A significant part of the production is coated, either by
hot dip galvanizing, electro galvanizing or organic coating.
ArcelorMittal Ghent also includes one organic coating line
located in Geel and one electro galvanizing line located in Genk.
ArcelorMittal Ghent’s products are mainly used in the
automotive industry and in household appliances, tubes,
containers, radiators and construction.
ArcelorMittal has finalized the construction of two industrial
scale plants at its site in Ghent in the framework of the Carbalyst
and Torero projects which are leveraging breakthrough smart
carbon technologies to enable the use of circular carbon.
Technical ramp-up of the facility is in progress. ArcelorMittal has
also started operating a pilot carbon capture unit on the blast
furnace off-gas at ArcelorMittal Gent in Belgium during 2024
with several partners.
See
“Business overview—Sustainable
development—Climate change and decarbonization".
ArcelorMittal Liège
The finishing facilities of ArcelorMittal Liège are located west of
Liège. ArcelorMittal Liège produces a wide range of innovative
products to meet the demanding needs of companies in the
automotive industry and industrial domestic appliances. The
operating assets in Liège include the continuous annealing line
1, hot dip galvanizing line 7 and line 8 (Eurogal), the
electrogalvanizing line 5 and the two organic coating lines, line 2
and line 7 (combiline with hot dip galvanizing line 7). It also
includes the Jet Vapor Deposition ("JVD") line, a world-class
innovative line coats moving strips of steel in a vacuum chamber
by vaporizing zinc onto the steel at high speed to produce
coated steels for automotive and other industrial applications.
ArcelorMittal Bremen
ArcelorMittal Bremen is situated on the bank of the Weser River
north of Bremen, Germany. ArcelorMittal Bremen produces and
sells a wide range of products including slab, hot rolled, pickled,
cold rolled and hot dip galvanized rolls to the automotive and
primary transformation sectors.
ArcelorMittal Méditerranée
ArcelorMittal Méditerranée operates a flat carbon steel plant in
Fos-sur-Mer. It also operates a finishing facility for electrical
steel located in Saint-Chély
d’Apcher
, 300 kilometers northwest
of Fos-sur-Mer. The Fos-sur-Mer plant is located 50 kilometers
67
|
Management report
|
west of Marseille on the Mediterranean Sea and includes a
private wharf for inbound and outbound flows.
ArcelorMittal Méditerranée’s products include coils to be made
into wheels, pipes for energy transport and coils for finishing
facilities for exposed and non-exposed parts of car bodies, as
well as for the construction, home appliance, packaging, pipe
and tube, engine and office material industries.
The Saint-Chély d’Apcher plant produces electrical steel (with
up to 3.2% silicon content), mainly for electrical motors.
At the Fos-sur-Mer site, a
new ladle furnace was commissioned
in the steel shop i
n September 2024
.
ArcelorMittal España
ArcelorMittal España includes the two main facilities of Avilés
and Gijón, which are connected by ArcelorMittal España’s own
railway system. These two facilities operate as a single
integrated steel plant. The product range of ArcelorMittal
España includes rail, wire rod, heavy plates and hot rolled coil,
as well as more highly processed products such as hot dip and
electro galvanized sheet, tinplate and organic coated sheet. The
facilities are also connected by rail to the region’s two main
ports, Avilés and Gijón. Raw materials are received at the port of
Gijón, where they are unloaded at a dedicated dry-bulk terminal,
which is linked to steel-making facilities by conveyor belt. A
variety of products are shipped through the Avilés port facilities
to other units of the Group and to ArcelorMittal España’s
customers.
In May 2024, t
he Company commenced construction of a new
1.1 million tonne EAF for
long products at the Gijón site and
which will ultimately lead to a reduction of 1 million tonnes of
CO
2
e.
See
“Business overview—Sustainable development—
Climate change and decarbonization".
ArcelorMittal Poland
ArcelorMittal Poland is the largest steel producer in Poland and
includes six plants located in Silesia, Malopolska and Opolskie
province. ArcelorMittal Poland’s Zdzieszowice coke plant
produces and supplies coke to ArcelorMittal subsidiaries and
third parties.
ArcelorMittal Poland produces a wide range of steel products,
including both long and flat products such as slabs, billets,
blooms, sections, sheet piles, rails up to 120 meters long,
railway accessories, mining supports sections, hot rolled coils,
sheets and strips, cold rolled coils, sheets and strips, hot dip
galvanized coils and sheets, wire rods and organic coated
sheets and coils. Products are mainly sold in the domestic
Polish market, while the remainder is exported, primarily to
customers located in other EU member states. ArcelorMittal
Poland’s principal customers are in the construction,
engineering, transport, mining and automotive industries.
Following the permanent closure in November 2020 of its blast
furnace and steel plant in Kraków, the coke
plant
continued to
operate, as did its downstream operations (two rolling mills, the
hot dip galvanizing line and the new organic coating line). The
slabs for the rolling mills in Kraków are supplied mainly from the
steel shop in Dabrowa Górnicza where the Company is
investing in debottlenecking projects and to produce special
grades for further processing into grain-oriented steel.
In November 2023, ArcelorMittal Poland announced its decision
to hot idle the coke oven battery in Kraków due to low demand
and coke pricing dynamics. In July 2024, the Company
completed its closure.
ArcelorMittal Poland's coke plant in
Zdzieszowice currently operates five coke oven batteries,
following the decommissioning of the battery 6 unit in 2024.
ArcelorMittal Eisenhüttenstadt
ArcelorMittal Eisenhüttenstadt is situated on the Oder river near
the German-Polish border, 110 kilometers southeast of Berlin.
ArcelorMittal Eisenhüttenstadt is a fully integrated and highly-
automated flat steel producing plant. The facility runs with one
medium-sized blast furnace.
ArcelorMittal Eisenhüttenstadt produces and sells a wide range
of flat steel products, including hot rolled, cold rolled, electrical
and hot dip galvanized and organic coated coils to automotive,
distribution, metal processing, construction and appliances
industry customers in Germany, Central and Eastern Europe.
ArcelorMittal Belval & Differdange
ArcelorMittal Belval & Differdange produces a wide range of
sections and sheets piles which are sold to the local European
construction market as well as for export. With its Rodange
facilities, it also produces a wide range of rails, special sections
and heavy
angles.
ArcelorMittal is investing €67 million in a new EAF at its Belval
site. This investment is part of a series of projects that were the
subject to a MoU signed in September 2022 between
ArcelorMittal Luxembourg and the Ministry of the Economy. The
new EAF
will
offer improved energy efficiency and increase
steel production capacity in Luxembourg by almost 15%,
reaching 2.5 million tonnes of steel per year.
Preparation
for
final
erection
works on the new EAF is ongoing, with dedicated
plant outage
currently scheduled for September 2025, and full
commissioning is expected in the first quarter of 2026.
ArcelorMittal Hamburg
ArcelorMittal Hamburg produces billet and high quality wire rod
and its products are mainly sold in the European market,
primarily to automotive and engineering customers.
The Hamburg site already operates Europe’s only DRI-EAF
plant.
Revamping of the DRI plant at the Hamburg site began in
October 2023, and production restarted in September
2024
.
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|
Management report
|
ArcelorMittal Olaberria-Bergara
The Olaberría-Bergara facilities produce billets and sections.
The Olaberría facility's products are sold to the local
construction market as well as to export markets, while the
Bergara facility’s products are sold primarily to the local
European construction market.
ArcelorMittal Duisburg
ArcelorMittal Duisburg produces blooms, billets, bars and high
quality wire rod and its products are mainly sold in the European
market primarily to automotive, railway and engineering
customers. ArcelorMittal Duisburg successfully commissioned
its second ladle furnace in July 2024.
ArcelorMittal Prijedor
ArcelorMittal Prijedor is an iron ore open pit mining operation
located in Bosnia and Herzegovina, near the town of Prijedor.
The mine is a joint venture in which ArcelorMittal owns 51% and
the other 49% is owned by the local iron ore mine Ljubija. The
ore is excavated at the Omarska mine and processed in the
processing plant. The mine supplies its final product, iron ore
lumps and concentrate, to ArcelorMittal's steel plant,
ArcelorMittal Zenica, located approximately 250 kilometers from
Prijedor in central Bosnia.
For further details on ArcelorMittal Prijedor mining assets,
production and other related information, see "—Mineral
reserves and resources".
|
Sustainable Solutions
|
Crude Steel
|
|||||||||
|
Unit
|
Main countries
of presence
|
Main locations
|
Production
in 2024
(in million to
nnes per
year)
1
|
Type of plant
|
Products
|
|||||
|
Industeel
|
France, Belgium
|
Charleroi, Le Creusot,
Chateauneuf,
Saint-Chamond, Dunkirk
|
0.4
|
Mini-mill and
Downstream
|
Flat
|
|||||
|
ArcelorMittal Construction
|
France,
Germany, Spain,
Italy, Slovakia,
Poland, India
|
Contrisson, Haironville,
Trier, Reichshof,
Zaragosa, Cervera,
Abruzzo, Senica,
Swietochlowice
|
n/a
|
Downstream
|
Steel building systems
|
|||||
|
ArcelorMittal Projects
|
UAE,
Netherlands,
USA, Brazil,
China, Egypt
|
Hamriyah, Jebel Ali,
Heijningen, Hoogeveen,
Serra, Changzhou, Badr
City
|
n/a
|
Downstream
|
Customized steel solutions
for complex projects in civil
infrastructure and energy
|
|||||
|
ArcelorMittal Steel Service Centers and
Distribution
|
France,
Germany,
Belgium, UK,
Spain, Poland,
Luxembourg
|
Reims, Neuwied, Geel,
Krakow, Bytom,
Differdange
|
n/a
|
Downstream
|
Tailor-made solutions of flat
steel processed products.
Sales entities serving small
customers with wide range
of steel products
|
|||||
|
ArcelorMittal Tubular Products
2, 3, 4
|
Poland
3
,
Romania, Czech
Republic,
Germany,
France, Spain
|
Kraków
3
, Roman, Iasi,
Karvina, Altensteig-
Walddorf, Hautmont,
Chevillon, Vitry, Lexy,
Rettel, Vincey,
Legutiano, Zalain-
Lesaka, Berrioplano
|
n/a
|
Downstream
|
Pipes and Tubes
|
|||||
|
Recycling
|
Germany,
Netherlands,
United Kingdom
|
Eppingen, Frankfurt,
Sennfeld, Almelo,
Beverwijk, Aberdeen
|
n/a
|
Downstream
|
Scrap collection and
recycling
|
|||||
|
AM Green Energy
|
India
|
Andhra Pradesh
|
n/a
|
Renewable energy
|
Solar and wind power
|
1.
n/a = not applicable (no crude steel production)
2.
ArcelorMittal Tubular Products Iasi decommissioned its pipe mill #2 (R220) in July 2024.
3.
Dismantling of both pipe mills #1 and #2 at ArcelorMittal Tubular Products Krak
ó
w plant commenced in December 2024 and is expected to be completed by the end of
the first quarter of 2025.
4.
ArcelorMIttal Tubular Products Lexy permanently idled its five pipe mills at its Fresnoy site in the first quarter of 2024.
The Sustainable Solutions segment is composed of a number of
niche capital-light businesses and includes the following
activities
:
Construction
Production of steel building systems, including insulation,
sandwich panels, profiles and turnkey pre-fabrication solutions.
Approximately 30% of the business relates to panels (e.g.
69
|
Management report
|
insulation) which support buildings to increase their energy
efficiency and a lower carbon footprint.
On May 31, 2024, ArcelorMittal Construction completed the
acquisition of Italpannelli Srl in Italy and Italpannelli Iberica in
Spain (following the purchase of Italpannelli Germany in March
2023) to significantly increase its capabilities in the panel
business. See "Introduction—Key transactions and events in
2024".
Projects
Projects is a global one-stop provider of customized steel
solutions and services for large and complex projects across
energy and civil infrastructure.
Industeel
Industeel provides solutions to meet the design needs of the
most demanding customer specifications with a complete range
of high-quality steel grades. Industeel is also ‘
XCarb®
recycled
and renewably produced’ producer since 2023 and has received
Responsible Steel Certification. Industeel, with operations in
Charleroi (Belgium), Le Creusot, Chateauneuf, Saint-Chamond
and Dunkirk (France) is designed to produce special steel plates
including stainless steel products and extra heavy gauge
products of alloyed carbon steel.
Renewables
AM Green Energy's $0.7 billion investment in the 975MW
renewable energy project was launched in 2022 by
ArcelorMittal. The project integrates solar and wind power
generation, coupled with energy storage solution through a co-
located pumped hydro storage plant, which helps to overcome
the intermittent nature of wind and solar power generation. The
project is owned and funded by ArcelorMittal. AMNS India
entered into a 25 year off-take agreement with ArcelorMittal to
purchase renewable power from the project.
See “Business
overview—Sustainable development—Climate change and
decarbonization".
Recycling
Recycling plays an increasingly important role in
decarbonization. ArcelorMittal is investing and developing its
scrap recycling and collection capabilities (three scrap recycling
businesses acquired in Europe and the United Kingdom in
2022-2023 with combined collection capacity of approximately 1
million tonnes).
Processing and distribution
Processing and distribution includes European distribution, steel
service centers and tubular processing. The European leading
steel distributor delivers steel solutions and services in safest,
quickest, and ecological way to all customers over Europe.
ArcelorMittal Tubular Products has operations in five countries:
Romania, Czech Republic, France, Spain and Germany (its
Kraków plant in Poland stopped production from the first quarter
of 2024 in response to market volatility and the intention to
reduce its carbon footprint).
Mining
ArcelorMittal’s Mining segment has iron ore production facilities in Canada and Liberia. The following table provides an overview of the
principal mining operations of ArcelorMittal’s Mining segment. For detailed information regarding ArcelorMittal's Mining segment see "—
Mineral reserves and resources".
|
Unit
|
Country
|
Locations
|
ArcelorMittal
Interest (%)
|
Type of Mine
|
Product
|
|||||
|
Iron Ore
|
||||||||||
|
AMMC
|
Canada
|
Mt Wright, Fire Lake and
Port Cartier, Qc
|
85.0
|
Iron Ore Mine (open pit), pellet
plant, railway and port
|
Concentrate and
pellets
|
|||||
|
AML
|
Liberia
|
Yekepa
|
85.0
|
Iron Ore Mine (open pit), railway
and port
|
Fines and Concentrate
|
|
Others
|
Crude Steel
|
|||||||||
|
Unit
|
Country
|
Locations
|
Production in 2024
(in million tonnes per
year)
|
Type of plant
|
Products
|
|||||
|
AMKR
|
Ukraine
|
Kryvyi Rih
|
1.6
|
Integrated
|
Long
|
|||||
|
ArcelorMittal South Africa
1, 2
|
South Africa
|
Vanderbijlpark, Newcastle
|
2.6
|
Integrated Mini-mill
Downstream
|
Flat, Long, Pipes and
Tubes
|
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|
Management report
|
|
Captive mining operations
|
||||||||||
|
Unit
|
Country
|
Locations
|
ArcelorMittal
Interest (%)
|
Type of Mine
|
Product
|
|||||
|
AMKR
|
Ukraine
|
Kryvyi Rih
|
95.1
|
Iron Ore Mine (open pit and
underground)
|
Concentrate, lump and
sinter feed
|
1.
Coke oven batteries 6 and 7 in Vanderbijlpark were permanently closed in September 2024. Coke oven battery 4 in Newcastle was closed in September 2024 upon
r
eaching the end of its life
.
2.
ArcelorMittal South Africa permanently discontinued operation of the Vereeniging melt shop (EAF and continuous casting machine), which was under care and
maintenance since October 2022, in the fourth quarter of
2024. The Vereeniging s
mall section mill was permanently decommissioned in the fourth quarter of 2024.
ArcelorMittal South Africa
ArcelorMittal South Africa is one of the largest steel producers in
Africa and is listed on the JSE Limited in South Africa.
ArcelorMittal South Africa has two main steel production
facilities: Vanderbijlpark and Newcastle, which are located
inland. ArcelorMittal South Africa also has a metallurgical by-
products division (Coke and Chemicals) split into two coke-
making and by-products operations at the steel production
facilities (Vanderbijlpark and Newcastle).
ArcelorMittal South Africa has a diversified range of products
and includes hot rolled plates and sheet in coil form, cold rolled
sheet, coated sheet, wire rod and sections, as well as forgings.
In
2024,
77%
of its products were sold in the South African
domestic market, while Africa is its largest export market. It also
sells into Asia and sells minor tonnage into Europe and the
Americas.
On January 6, 2025, ArcelorMittal South Africa announced the
wind-down of its Long products Business. Steel production was
originally announced to cease by late January 2025, and the
wind-down of the remaining production processes to be
completed in the first quarter of
2025
. Currently, the wind-down
is being postponed for one additional month as discussions
continue regarding potential governmental support. See
“Introduction—Key transactions and events in 2024".
Thabazimbi Iron Ore Mine
The Thabazimbi Iron Ore Mine (Pty) Ltd, located at Thabazimbi,
in the Limpopo Province of South Africa, was acquired by
ArcelorMittal South Africa in 2018. Thabazimbi Iron Ore Mine
currently processes existing stockpiles of iron ore from a run of
mine (unbeneficiated) and old plant discard dumps with
recoverable iron, with the aim of supplying product to the
Vanderbijlpark Steel Works. For further details on Thabazimbi
mine, see "—Mineral reserves and resources".
ArcelorMittal Kryvyi Rih
AMKR’s product range includes billets, rebars and wire rods,
light sections (angles) and merchant bars (rounds, squares and
strips). Its products are sold to a range of industries, such as
hardware, construction, re-rolling and fabrication. The markets
for its products include Ukraine, CIS, Europe, North Africa,
Middle East, North and Central America and China.
In addition, AMKR includes an export sales network which
supplies a complete range of steel products not only from Kryvyi
Rih but also from other plants of the Group to customers outside
of their respective home markets.
AMKR also has iron ore captive mines located roughly within the
borders of the city of Kryvyi Rih, Ukraine. AMKR operates a
concentrating facility, along with two open pit sites and one
underground iron ore mine. The iron ore extracted from the
Kryvyi Rih mining operations is processed to concentrate, sinter
feed and lumps and supplied primarily to the AMKR steel plant,
with some concentrate being shipped to other ArcelorMittal
entities in Eastern Europe, as well as to third parties. For further
details on Ukraine mines production, see "—Mineral reserves
and resources".
During 2024, with respect to its steelmaking operations in Kryvyi
Rih, the Company continued to ramp up operations and has
been operating two blast furnaces.
As of the end of 2024, AMKR
was operating its open pit mining facilities at 75% of capacity
and its steel facilities at 23
%
of capacity.
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|
Management report
|
|
Investments in joint ventures
|
||||||||||
|
Unit
|
Country
|
Locations
|
Capacity in 2024
(in million tonnes per
year)
|
Type of plant
|
Products
|
|||||
|
AMNS India
|
India
|
Hazira, Gujarat
|
8.8
1
|
Integrated
|
Flat
|
|||||
|
AMNS Calvert
|
United States
|
Calvert
|
5.3
2
|
Steel processing
|
Steel finishing
|
|||||
|
VAMA
|
China
|
Loudi, Hunan
|
2.0
3
|
Steel processing
|
Automotive steel finishing
|
|
Captive mining operations
|
||||||||||
|
Unit
|
Country
|
Locations
|
ArcelorMittal
Interest (%)
|
Type of Mine
|
Product
|
|||||
|
Thakurani Iron Ore Mine
|
India
|
Odisha
|
60.0
|
Iron Ore Mine (open pit)
|
Lump and fines
|
|||||
|
Ghoraburhani-Sagasahi
|
India
|
Odisha
|
60.0
|
Iron Ore Mine (open pit)
|
Lump and fines
|
1.
Crude steel capacity.
2.
Flat-rolled steel products production capacity.
3.
Cold rolled coils, aluminized coils, hot dip galvanized coils production capacity.
AMNS
India
AMNS India is an integrated flat carbon steel manufacturer -
from iron ore to ready-to-market products with achievable crude
steel capacity of 8.8 million tonnes per annum. Its manufacturing
facilities comprise iron making, steelmaking and downstream
facilities spread across India.
In 2019, ArcelorMittal and Nippon Steel Corporation ("NSC"),
Japan’s largest steel producer and the third largest steel
producer in the world, created a joint venture to own and
operate AMNS India with ArcelorMittal holding a
60%
interest
and NSC holding
40%
. Through the agreement, both
ArcelorMittal and NSC are guaranteed equal board
representation and participation in all significant financial and
operating decisions.
AMNS India’s main steel manufacturing facility is located at
Hazira, Gujarat in western India. It also has:
–
two
iron ore beneficiation plants close to the mines in
Kirandul and Dabuna, with slurry pipelines that then
transport the beneficiated iron ore slurry to the pellet plants
in the Kirandul-Vizag and Dabuna-Paradeep systems;
–
downstream facilities in Pune, Khopoli and Gandhidham;
and
–
six
service centers in the industrial clusters of Hazira,
Indore, Bahadurgarh, Chennai, Kolkata and Pune. It has a
complete range of flat rolled steel products, including value
added products, and significant iron ore pellet capacity with
two
main pellet plant systems in Kirandul-Vizag and
Dabuna-Paradeep, which have the potential for expansion.
Its facilities are located close to ports with deep draft for
movement of raw materials and finished goods.
In terms of iron ore pellet capacity, the Kirandul-Vizag system
has 8 million tonnes of annual pellet capacity; and the Dabuna-
Paradeep system has 12 million tonnes of annual pellet
capacity.
AMNS India completed the acquisition of the portfolio of
strategic infrastructure assets from Essar Group. The remaining
assets which were pending due to regulatory approvals have
been acquired during 2024 and include
a 16 million-tonne per
annum all-weather, deep draft terminal at Visakhapatnam,
Andhra Pradesh (along with an integrated conveyor connected
to AMNS India’s iron ore pellet plant in the port city) and a 100-
kilometer Gandhar - Hazira transmission line, connecting AMNS
India’s steelmaking complex with the central electricity grid.
The resolution plan submitted for the acquisition of AMNS India
in 2018 included a capital expenditure plan of approximately
$2.6 billion to be implemented in two stages over 6 years.
The
first stage involves investments which increase production of
finished steel goods to 7.6 million tonnes per annum. It includes
capital expenditure projects with respect to third line CSP caster
(completed), Paradeep pellet plant (completed), as well as coke
oven, second sinter plant and Dabuna beneficiation plant (in
progress). The first stage also includes investment in
maintenance to restore current assets, the implementation of an
environmental management plan and the implementation of
ArcelorMittal’s best practices on raw material sourcing, plant
operations, sales and product mix (in particular through greater
sophistication of the quality and markets of the steel produced
with a focus on developing sales to the automotive industry),
people management and health & safety. The second stage
involving capital expenditure projects to increase the production
of finished steel goods from 7.6 million tonnes per annum to 8.6
million tonnes per annum is now included in the expansion
investment plan launched in October 2022 as described below.
72
|
Management report
|
AMNS India intends to further debottleneck existing operations
(steel shop and rolling parts) in the medium term.
The first
phase of expansion represents capital expenditures of
approximately
$7.7 billion
($0.8 billion for debottlenecking, $0.2
billion for operational readiness, $1.0 billion for downstream
projects and
$5.7
billion for upstream projects) and started in
October 2022.
It aims to increase production at the Hazira
facility to 15 million tonnes of rolled products by the second half
of 2026 (phase 1) following the construction of two blast
furnaces (blast furnace 2 to start in 2025 and blast furnace 3 in
2026), the capacity increase of the existing blast furnace 1 from
2.2 to 2.8 million tonnes per annum and it includes also a cold
rolling mill 2 complex and galvanizing and annealing line, steel
shop, hot strip mill and ancillary equipment (including coke,
sinter, networks, power, gas, oxygen plant, etc.) and raw
material handling. Continuous galvanizing line No. 4 was
commissioned in December 2023, which will enable AMNS India
to launch the Magnelis product for the growing renewable
energy sector. Plans are under development to expand the
production capacity further. As per phase 2, steelmaking
capacity would grow to 18 million tonnes per annum by 2028
and as per phase 3 production capacity would further increase
to 24 million tonnes. Additionally, greenfield development
options are under consideration to take steelmaking capacity to
40 million tonnes per annum in the long-term. See
"—Capital
expenditures".
In terms of mining assets, AMNS India operates the Thakurani
mine in the Keonjhar district of Odisha and the Ghoraburhani-
Sagasahi mine in the Sudargarh district of Odisha. The
Thakurani mine is operating at
full 5.5 million tonnes per annum
capacity and concentrated material is transported by pipeline
from the Dabuna plant to the Paradeep pellet plant, located on
the coast at Bay of Bengal. AMNS India commenced the
operations at the Ghoraburhani-Sagasahi iron ore mine in
September 2021. The mine is set up to gradually ramp up
production until 2026 to a rated capacity of 7.2 million tonnes
per annum.
The iron ore final product is supplied to the
beneficiation plant in Dabuna from where the feed reaches the
pellet plant at Paradeep and contributes significantly to meeting
AMNS India’s long-term raw material requirements. For further
details on Indian mines production and other information, see "
—Mineral reserves and resources".
AMNS Calvert
AMNS Calvert ("Calvert"), a joint venture between the Company
and NSC, is a steel processing plant in Calvert, Alabama, United
States. Its 2,500 acre property layout allows f
or optimal product
flow and room to expand. It has a Hot strip mill "HSM" with 5.3
million tonnes capacity, pickling and cold rolling facilities with 3.6
million tonnes capacity and finishing facilities with a total
capacity of 2.1 million tonnes. S
labs
for Calvert's operations are
sourced from ArcelorMittal plants in Brazil and Mexico and from
former ArcelorMittal USA, which following the divestment to
Cleveland-Cliffs, entered on
December 9, 2020 into a new
five
-
year agreement with Calvert (with an automatic
three
-year
extension unless either party provides notice of intent to
terminate) fo
r
1.5
million tonnes annually for the initial term and
0.55
million tonnes annually under the extension and which, in
each case, can be reduced with a
six
-month notice. In
December 2024, Cleveland-Cliffs formally issued a notice to
terminate the agreement at the end of the initial term on
December 9, 2025.
ArcelorMittal is principally responsible for
marketing the product on behalf of the joint venture. Calvert
serves the automotive, construction, pipe and tube, service
center and appliance/ HVAC industries.
Calvert is constructing an on-site steelmaking facility through a
1.5 million tonnes capacity EAF (producing slabs for the existing
operations and replacing part of the purchased slabs).
Construction commenced in March 2021 after obtaining all
environmental permits, and the facility is currently under
commissioning
.
S
ee "—Capital expenditures"
.
VAMA
Valin ArcelorMittal Automotive Steel (“VAMA”) is a joint venture
between ArcelorMittal and Hunan ValinSteel Co., Ltd which
produces steel (1.5 million tonne capacity) for high-end
applications in the automotive industry. VAMA supplies
international automakers and first-tier suppliers as well as
Chinese car manufacturers and their supplier networks. It is well
positioned to take advantage of the growing electric vehicle
market, and in February 2021 a project was launched to
increase its capacity by 40% to 2 million tonnes with self-funded
expansion involving capital expenditures of $195 million. The
capital expenditures related to new continuous hot galvanizing
line ("CGL") capacity of 450 thousand tonnes per year to reach
1.6 million tonnes per year in CGL/CAL combined capacity and
2.0 million tonnes per year in pickling line and tandem cold mill
("PLTCM"). First commercial coil was produced on January 3,
2023 and commercial production began in April 2023. The
project has been operating at full capacity since July 2023.
Ventos de Santo Antonio
On May 5, 2023, ArcelorMittal Brasil formed the joint venture
Ventos de Santo Antonio Comercializadora de Energia S.A.
("VdSA") with Casa dos Ventos, one of Brazil’s largest
developers and producers of renewable energy projects, to
develop a 554 MW wind power project in the central region of
Bahia, in north-east Brazil. ArcelorMittal Brasil holds a 55%
stake in the joint venture, with Casa dos Ventos holding the
remaining 45%. The $0.8 billion project aims to secure and
decarbonize a considerable proportion of ArcelorMittal Brasil’s
future electricity needs and is estimated to provide 38% of
ArcelorMittal’s Brasil’s total electricity needs in 2030 pursuant to
a 20-year power purchase agreement to be entered into with the
joint venture for the supply of electricity. VdSA is equity
73
|
Management report
|
accounted and ArcelorMittal’s total equity investment will be
$0.15 billion. P
roject execution is on track with overall project
progress of approximately 80%. Operational commissioning is
ex
pected in 2025.
In addition, ArcelorMittal Brasil signed related
contracts
on
August 21,
2024 for the development of two solar energy
projects with a combined capacity of 465MW, equivalent to 14%
of its current electricity requirements.
See "Introduction—
Sustainable development highlights".
See note 2.4.1 to the consolidated financial statements for
further information on investments in joint ventures.
Capital expenditures
The Company’s capital expenditures were $4.4 billion, $4.6
billion and $3.5 billion for the years ended December 31, 2024,
2023 and 2022, respectively. The following table summarizes
the Company’s principal growth and optimization projects
involving significant capital expenditures that are currently
ongoing. In 2025, capital expenditures are expected to be in the
range of $4.5 to 5.0 billion of which $1.4 to $1.5 billion is
expected as strategic growth capital expenditure and $0.3-$0.4
billion on projects related to decarbonization. ArcelorMittal
expects to fund these capital expenditures primarily through
internal sources. See “Operating and financial review—Liquidity
and capital resources—Sources and uses of cash—Net cash
used in investing activities” and note 3.1 to the consolidated
financial statements for further information, including capital
expenditures by segment.
|
Completed Projects
|
|||||||||
|
Segment
|
Site / Unit
|
Capacity / particulars
|
Key date / Forecast
completion
|
Note #
|
|||||
|
Brazil
|
ArcelorMittal Vega Do Sul
|
Increase hot dipped / cold rolled coil capacity and construction
of a new 700 thousand tonnes continuous annealing line
(CAL) and continuous galvanizing line (CGL) combiline
|
Second quarter 2024
(first coil)
|
a
|
|||||
|
Sustainable Solutions
|
Andhra Pradesh (India)
|
Renewable energy project: 1GW of nominal capacity solar and
wind power
|
Commissioning in
progress
|
b
|
|||||
|
India and JVs
|
AMNS Calvert
|
New 1.5 million tonnes EAF and caster
|
Commissioning
underway
|
c
|
|||||
|
Ongoing Projects*
|
|||||||||
|
Segment
|
Site / Unit
|
Capacity / particulars
|
Key date / Forecast
completion
|
Note #
|
|||||
|
Brazil
|
Serra Azul mine
|
Facilities to produce 4.5 million tonnes per year DRI quality
pellet feed by exploiting compact itabirite iron ore.
|
Second half 2025
|
d
|
|||||
|
Brazil
|
Barra Mansa
|
Increase capacity of HAV bars and sections by 0.4 million
tonnes per year
|
Second half 2025
|
e
|
|||||
|
Europe
|
Mardyck (France)
|
New Electrical Steels. Facilities to produce 170 thousand
tonnes NGO Electrical Steels (of which 145 thousand tonnes
for auto applications) consisting of annealing and pickling line
(APL), reversing mill (REV) and annealing and varnishing
(ACL) lines
|
First half 2025 for
ACL
Second half 2025 for
APL/REV
|
f
|
|||||
|
Mining
|
Liberia mine
|
Phase 2: Iron ore expansion to 20 million tonnes per annum;
blending a portion of the new concentrate with crushed ore
product to produce a sinter feed blend (>62% Fe)
|
(first concentrate
produced) full 20
million tonnes
capacity is expected
by the end of 2025
|
g
|
|||||
|
North America
|
Las Truchas mine
(Mexico)
|
Revamping project with 1 million tonnes per year pellet feed
capacity increase (to 2.3 million tonnes per year) with DRI
concentrate grade capability
|
First half 2026
|
h
|
|||||
74
|
Management report
|
|
India and JVs
|
Hazira
|
Debottlenecking existing assets; AMNS India medium-term
Phase 1 plans are to expand and grow in Hazira to
approximately 15 million tonnes by end of 2026; ongoing
downstream projects; plans for expansion to 24 million tonnes
under preparation by 2030; additional greenfield opportunities
under development
|
Second half 2026
|
i
|
|||||
|
North America
|
AM Calvert (USA)
|
Advanced manufacturing facility for non-grain oriented
electrical steel (NOES) with a capacity of up to 150 thousand
tonnes per year, essential for EV production and other
commercial/industrial applications. The project consists of
annealing and pickling line (APL), reversing cold mill (RCM)
and annealing and varnishing (ACL).
|
Second half 2027
|
j
|
*Ongoing projects refer to projects for which construction has begun (excluding various projects that are under development).
a.
The Vega Do Sul expansion project targets the growing domestic market with an approximately $0.4 billion investment. It includes an option for a 100,000-tonne organic
coating line for construction and appliances. Upon completion, it will strengthen ArcelorMittal’s position in the automotive and industrial markets with AHSS products. The
pickling line and tandem cold mill produced their first coil in June 2023, followed by the first continuous annealed commercial coil in June 2024. Coated production (GI)
began in July 2024, Magnelis trials in September 2024, and the CGLCAL PAC-Provisional Acceptance Certificate was issued on December 16, 2024.
b.
See “Business overview—Sustainable development—Climate change and decarbonization".
c.
AMNS Calvert is constructing a new 1.5 million tonnes EAF and
caster
. The facility is currently in the hot commissioning phase. The new EAF project with investment over
$1 billion, integrated with ArcelorMittal’s HBI facility in Texas, will enable Calvert to supply automotive customers with lower CO
2
embodied steel, melted and poured in the
U.S. The new EAF has a strong product mix of advanced steel grades, including Exposed, Dual Phase (DP), Multiphase (MP), Third Generation (Gen-3) steels and Press
Hardened Steels (PHS) namely Usibor®. Option to add a further 1.5 million tonnes EAF at lower capital expenditure intensity is being studied.
d.
The Serra Azul project's current investment forecast is approximately $0.5 billion. The DRI quality pellet feed is expected to primarily supply ArcelorMittal Mexico steel
operations. Completion is delayed by 1 year mainly due to delayed delivery of equipment.
e.
Approximately $0.3 billion investment in the Barra Mansa (Brazil) sections mill aims to expand domestic market share and profitability with higher added value ("HAV")
products like merchant and special bars. Project completion is now expected in the second half of 2025 as a result of unforeseen challenges during civil works.
f.
ArcelorMittal, with French government support, is establishing a new electrical steels production unit at Mardyck, complementing its Saint-Chély d’Apcher plant. The $0.5
billion investment will be completed in two phases: commissioning and ramp-up of the annealing and coating line in the first half of 2025, followed by APL and REV startup
in the second half of 2025. The delay from the initial timeline is due to unforeseen civil construction challenges and resource constraints among main contractors.
g.
ArcelorMittal Liberia has been operating at 5 million tonnes per annum of direct shipping ore (DSO) since 2011 (Phase 1) and restarted construction of a concentrator and
associated infrastructure (Phase 2). Project commissioning ongoing with most procurement and civil works completed in 2024 (with minor areas still to be concluded) and
structural, mechanical, piping and platework well progressed. An opportunity to increase port shipment capacity to 20 million tonnes per annum led to a revised project
capital expenditure of $1.8 billion (previously $1.4 billion), r
eflecting a multiple product approach (sinter feed and concentrate) following revised mining plan and additional
investment in material handling, port infrastructure, covered stockpile and power supply.
The revised scope allows for an additional 5 million tonnes per annum of blended
product, bringing total shipment capacity to 20 million tonnes per annum (previously 15 million tonnes per annum). By blending a portion of the new concentrate with
crushed ore product, a sinter feed blend
(>62% Fe)
can be produced, increasing Liberia’s marketable production. Of the targeted 20 million tonnes, 75% or 15 million
tonnes of sinter feed is to be made up of a blend of 10 million tonnes concentrate and 5 million tonnes of crushed ore, and remaining 25% or 5 million tonnes is to be
represented by high-grade concentrate.
First
concentrate was produced during commissioning activities in the fourth quarter of 2024, with commissioning targeted for
mid-2025 and full project completion and capacity ramp-up expected in the fourth quarter of 2025. Approximately 10 million tonnes of shipments are targeted in 2025 (with
the majority of shipments expected in the second half of 2025). In addition, a phased plan to expand capacity up to 30 million tonnes per annum, including DRI-quality
concentrate is under study.
h.
Approximately $0.2 billion investment project will enable concentrate production to the blast furnace route (2 million tonnes per year) and DRI route (0.3 million tonnes per
year) for a total of 2.3 million tonnes per year. Primary target is to supply ArcelorMittal Mexico steel operations with high quality feed. Due to delay in equipment delivery
and construction works,
amplified by the strike/illegal blockade of the mine in the second and third quarters of 2024
. production is expected to start in the first half of 2026.
i.
AMNS India medium-term plans are to expand and grow initially to approximately 15 million tonnes by the second half of 2026 in Hazira (phase 1) including automotive
downstream and enhancements to iron ore operations, with estimated capital expenditure of approximately $7.7 billion ($0.8 billion for debottlenecking, $0.2 billion for
operational readiness, $1.0 billion for downstream projects and $5.7 billion for upstream project). Studies for options to further expand capacity at Hazira from 15 million
tonnes to ultimately reach 24 million tonnes are in progress. Also,the development of two greenfield options on the East Coast (Paradeep and Kendrapara) to take overall
capacity above 40 million tonnes is under study.
j.
See "Introduction—Sustainable developments highlights"
In addition, in 2024,
the Company approved 17 multi-year
projects with identified environmental benefits and involving
capital expenditures of $219 million and 32 multi-year projects
with identified energy benefits and involving capital expenditure
of $326 million. The latter also includes 11 multi-year projects
specifically targeted to decarbonization involving capital
expenditures of $146 million.
Capital expenditures related to
decarbonization initiatives amounted to $0.3 billion for the year
ended December 31, 2024 and are expected to remain stable
between $0.3 to
$0.4 billion in 2025, with main spend focusing
on continuation of engineering studies on DRI-EAF facilities in
Europe (flat products), implementation of new EAF project in
Gijón (long products) with total expected investment of $0.2
billion and EAF capacity expansion in Sestao (flat products) with
total expected investment of $0.1 billion, as well as new DR
pellet project in AMMC.
ArcelorMittal's joint ventures have also announced significant
capital expenditure projects. See "Property, plant and equipment
—
Investments in joint ventures" and "Property, plant and
equipment
—
Capital expenditures".
75
|
Management report
|
Mineral reserves and resources
ArcelorMittal has iron ore production facilities in North America
(Canada and Mexico) South America (Brazil), Europe (Bosnia
and Ukraine), Africa (Liberia) and in India through its joint
vent
ure AMNS India. ArcelorMittal also operated iron ore and
coal production facilities in Kazakhstan, which were sold on
December 7, 2023. See note 2.3 to the consolidated financial
statements for further information. Following the sale of the
Kazakhstan operations, there was no coal production in 2024,
while coal production for 2023 and 2022 was 2.0 million tonnes
and 2.6 million tonnes, respectively. The Company has two
categories of mining operations, namely captive mines, and
seaborne oriented
operations. Captive mines, whose production
is mainly consumed by their respective steel segments, form
part of such segments. The seaborne iron ore mining operations
at AMMC and AML correspond to the Mining segment.
ArcelorMittal considers its iron ore mining operations in
aggregate to be material to its business.
The following table provides an overview of ArcelorMittal’s principal mining operations. The production of Run of Mine ("ROM") iron ore
and coal is that which is attributable to ArcelorMittal, based on ArcelorMittal's ownership interest in the mining operations. All production
figures below are stated as wet tonnages.
|
Operations/Projects
|
Segment
|
% of Ownership
Interest
|
Type of
Ownership
Interest
|
In Operation since
|
||||
|
Iron Ore
|
||||||||
|
Mexico (Excluding Peña Colorada)
|
North America
|
100.0
|
subsidiary
|
1976
|
||||
|
Peña Colorada - Mexico
|
North America
|
50.0
|
joint operation
|
1974
|
||||
|
Brazil
|
Brazil
|
100.0
|
subsidiary
|
1944
|
||||
|
Bosnia
|
Europe
|
51.0
|
subsidiary
|
2008
|
||||
|
AMKR Open Pit
|
Others
|
95.1
|
subsidiary
|
1959
|
||||
|
AMKR Underground
|
Others
|
95.1
|
subsidiary
|
1933
|
||||
|
AML
|
Mining
|
85.0
|
subsidiary
|
2011
|
||||
|
AMMC
|
Mining
|
85.0
|
subsidiary
|
1976
|
||||
|
Vallourec Pau Branco mine
|
Not Consolidated
|
27.9
|
associate
|
1980
|
||||
|
India
|
Not Consolidated
|
60.0
|
joint venture
|
1961
|
||||
|
Baffinland
|
Not Consolidated
|
25.2
|
associate
|
2014
|
||||
|
2022 aggregate ROM iron ore production, millions of tonnes
1
|
102.5
|
|||||||
|
2023 aggregate ROM iron ore production, millions of tonnes
1
|
98.4
|
|||||||
|
2024 aggregate ROM iron ore production, millions of tonnes
2
|
100.7
|
|||||||
|
Coal
|
||||||||
|
Karaganda - Kazakhstan
|
100.0
|
subsidiary
|
1956
|
|||||
|
2022 aggregate ROM coal production, millions of tonnes
|
7.0
|
|||||||
|
2023 aggregate ROM coal production, millions of tonnes
1
|
5.8
|
|||||||
1. Total ROM iron ore and coal production in 2023 and 2022 includes Kazakhstan iron ore and coal mining operations, which were sold on December 7, 2023. Iron ore and
coal production is included in the table through the transaction closing date.
2. Total ROM iron ore production in 2024 does not include Vallourec Pau Branco mine.
76
|
Management report
|
Summary of ArcelorMittal’s Mining Operations
ArcelorMittal's iron ore mining operations include the captive mines of the North America, Brazil and Europe segments, Others and
AMMC and AML in the Mining segment. ArcelorMittal has either 100%, equal or majority interest in these mining operations. In addition,
the Company owns a 60% interest in the AMNS India joint venture and a 25.23% interest in the associate Baffinland. On August 6,
2024, the Company acquired a 28.4% interest in the associate Vallourec who owns and
operates
the Pau Branco mine in Brazil.
ArcelorMittal's mining operations included full ownership of the captive iron ore and coal mines in Kazakhstan forming part of the former
ACIS segment, until the sale of ArcelorMittal Temirtau (i.e., December 2023).
77
|
Management report
|
Iron ore operations
North America
ArcelorMittal Mexico Mining Assets
ArcelorMittal Mexico operates two iron ore mines in Mexico, the Las Truchas mines, and through a joint operation with Ternium, the
Peña Colorada mine. The El Volcan and San José mines stopped production in 2019 and 2024, respectively, due to depletion of
reserves.
|
% of
Ownership
Interest
|
2024
|
2023
|
2022
|
||||
|
ROM Millions
of Tonnes
|
Product
Millions of
Tonnes
|
ROM Millions
of Tonnes
|
Product
Millions of
Tonnes
|
ROM Millions
of Tonnes
|
Product
Millions of
Tonnes
|
||
|
Peña Colorada - Mexico
|
50.0
|
||||||
|
At 100%
|
7.9
|
2.7
|
12.8
|
4.1
|
13.5
|
4.1
|
|
|
At ownership interest (50%)
|
3.9
|
1.4
|
6.4
|
2.1
|
6.8
|
2.1
|
|
|
Mexico (Excluding Peña Colorada)
|
100.0
|
||||||
|
Las Truchas
|
4.1
|
1.0
|
3.0
|
1.4
|
4.2
|
1.4
|
|
|
San Jose/El Volcan
|
0.5
|
0.2
|
1.4
|
0.7
|
2.4
|
1.0
|
|
|
North America, (100% basis)
|
12.5
|
3.9
|
17.2
|
6.2
|
20.1
|
6.5
|
|
|
North America, (ArcelorMittal
ownership basis)
|
8.5
|
2.6
|
10.8
|
4.2
|
13.4
|
4.5
|
|
Peña Colorada
Peña Colorada is the operator of a production stage surface iron
ore mine, located 60 kilometers to the north-east of the port city
of Manzanillo, in the province of Minatitlán in the north-western
part of the State of Colima, Mexico. ArcelorMittal holds 50% of
Peña Colorada through a joint operation with Ternium, who
owns the other 50% interest.
Peña Colorada controls a total o
f 4,167 h
ectares of surface
rights and holds mineral rights over
39,978 hectares (98,791
acres) across 20 concessions. According to n
ew regulations
,
government concessions are granted by the Mexican federal
government for an initial period of 30 years. However, the
applicability of this new regulation to Peña Colorada is subject to
pending governmental procedures as of the date of this annual
report. The expiration dates of the current mining concessions
range from 2043 to
2062.
Peña Colorada is a complex polyphase iron ore deposit. The
iron mineralization at Peña Colorada consists of banded to
massive concentrations of magnetite within breccia zones and
results from several magmatic, metamorphic and hydrothermal
mineralization stages with associated skarns, dykes and late
faults sectioning the entire deposit.
Peña Colorada operates an open pit mine as well as a
concentrating facility and a two-line pelletizing facility. The ore is
mined by truck and shovel/loader method. The beneficiation
plant and the pelletizing plant are located at the mine and in
Manzanillo, respectively. Major processing facilities include a
primary crusher, a dry cobbing plant, two autogenous mills,
three horizontal and two vertical ball mills and several stages of
magnetic separation. The concentrate is sent as a pulp through
a pipeline from the mineral processing plant to the pelletizing
facilities. The magnetite concentrate and pellets are transported
from Manzanillo to ArcelorMittal Mexico, as well as to Ternium’s
steel plants, by ship and by rail.
Las Truchas
Las Truchas is a production stage mine located approximately
27 kilometers north-west of the town of Lázaro Cárdenas in the
State of Michoacán, Mexico. ArcelorMittal holds a 100% interest.
ArcelorMittal Mexico holds mineral rights over 53,812 hectares,
of which 4,261 support the Las Truchas operations in Mexico.
Government concessions are granted by the Mexican federal
government for a p
eriod of 50 years and are
renewable. The
expiration dates of the current mining concessions range from
2044 to
2053
.
The Las Truchas deposits consist of massive concentrations of
magnetite of irregular morphology. The main Las Truchas
deposits occur along a geological trend that is about seven
kilometers long and about two kilometers wide. The Las Truchas
mineral deposits have been classified as hydrothermal deposits,
which may have originated from late-stage plutonic activity
injecting through older sedimentary rocks. The mineralization of
78
|
Management report
|
the Las Truchas iron deposits occurs in disseminated and
irregular massive concentrations of magnetite within
metamorphic rocks and skarns. The mineralization also occurs
as fillings of faults, breccia zones, and fractures.
Mining activities consist of open pit mining, crushing, dry
cobbing to generate pre-concentrate, and a concentration plant.
The concentrator includes two primary crushers, two secondary
crushers and three tertiary crushers, two ball mills, two bar mills
and two wet magnetic separation circuits. The concentrated ore
is pumped from the mine site through a 26 kilometer slurry
pipeline to the steel plant facility in Lázaro Cárdenas.
ArcelorMittal Mexico launched a project to increase pellet feed
production to 2.3 million tonnes per annum and improve
concentrate grade in Las Truchas; see "—Capital expenditures".
San José
The San José mine ceased its operations in 2024 due to the
depletion of resources, as such there have been no mineral
reserves or resources estimated for this property. It is located
approximately 40 kilometers South-East of the town of Culiacán,
the capital of the State of Sinaloa, México. Mining at San José
began in 1946 and was handled by multiple owners until 2019,
when ArcelorMittal secured a lease agreement and commenced
mining and pre-concentration operations. ArcelorMittal’s interest
in the San José mine is 100%.
ArcelorMittal Mexico holds mineral concessions for 30 hectares
which supported its now closed San José operations.
Additionally, ArcelorMittal Mexico holds mineral rights over 1,053
hectares which previously supported its now closed El Volcan
operations, located approximately 68 kilometers northwest of
the city of Obregon.
ArcelorMittal Mexico has a lease agreement secured from Ejido
Las Flechas, for both the land and the San José facilities, which
is in place for a period of ten years and is valid until 2028.
Previous mine operators have secured surface rights to the
project from the Ejido in the past and it is reasonable to assume
that ArcelorMittal Mexico can continue to secure surface rights
beyond 2028.
BRAZIL
ArcelorMittal Brasil operates the Andrade mine and Serra Azul Mineração mines.
|
% of
Ownership
Interest
|
2024
|
2023
|
2022
|
||||||||
|
ROM Millions
of Tonnes
|
Product
Millions of
Tonnes
|
ROM Millions
of Tonnes
|
Product
Millions of
Tonnes
|
ROM Millions
of Tonnes
|
Product
Millions of
Tonnes
|
||||||
|
Andrade
|
100
|
2.4
|
1.8
|
2.4
|
2.0
|
2.3
|
1.8
|
||||
|
Serra Azul
|
100
|
5.1
|
1.1
|
2.7
|
1.5
|
2.6
|
1.5
|
||||
|
Brazil
|
7.5
|
2.9
|
5.1
|
3.5
|
4.9
|
3.3
|
|||||
Andrade Mine
The Andrade Mine is a production stage open pit iron ore mine,
located 5 kilometers away from the town of João Monlevade and
80 kilometers east of Belo Horizonte in the Brazilian state of
Minas Gerais. The Andrade mine is 100% owned and operated
by the Long products division of ArcelorMittal Brasil, with all
production supplying the Monlevade steel plant.
ArcelorMittal’s operations control all of the mineral rights and
surface rights needed to mine and process its estimated iron ore
reserves, dominated by directly shippable hematite ore.
ArcelorMittal Brasil holds mineral rights of
over 2,885
hectares
and land lease over 3,347 hectares to support its current
operation. Mining legislation in Brazil does not predetermine the
duration of mineral rights and as such these rights are
considered valid to the point of mine exhaustion.
The Andrade deposit is located in the north-eastern part of the
Iron Quadrangle. The base stratigraphic section consists of
quartzites and sericite-quartzites of the Moeda formation,
followed by schists of the Batatal formation, both forming the
Caraça group. The iron rich mineral bodies are part of the
overlying Cauê formation, which represents the base of the
Itabira Group. The Caraça and Itabira groups compose the base
of the Paleoproterozoic Minas Supergroup. The Cauê formation
rocks are covered by dolomites and marbles, and sometimes
weathered phylites and schists, belonging to the Gandarela
formation.
In addition to the open pit mine, the Andrade mine operates a
crushing and screening facility, as well as a concentration plant
used to improve the quality of the sinter feed to the Monlevade
plant. This concentration plant commenced production in early
2020 and concentrates the itabirite ores, enabling mixing with
the higher-grade hematite ores. The concentrated iron ore
79
|
Management report
|
product is transported to the Monlevade steel plant through a
private railway line.
In 2022, the resource model of Andrade has been updated,
resulting in a new pit optimization and mine schedule, with
updated Life of Mine schedule for the Itabirite and Hematite
ores. The new life of mine extends to 2054, with increased
annual ROM capacity up to 4.5 million tonnes after 2027.
Serra Azul Mine
ArcelorMittal Mineração Serra Azul mine is a production stage
open pit iron ore mine located approximately 70 kilometers
southwest of Belo Horizonte in the Minas Gerais State of Brazil.
The mine is 100% owned and operated by ArcelorMittal Brasil.
ArcelorMittal Brasil controls all of the mineral and surface rights
needed to mine and process its iron ore reserves. ArcelorMittal
Brasil holds mineral rights over the Central and East claims of
the Serra Azul deposit of over 375 hectares and surface rights
over
288
hectares. Mining legislation in Brazil does not
predetermine the duration of mineral rights and as such these
rights are considered valid to the point of mine exhaustion.
The Serra Azul mine is located in the western part of the Iron
Quadrangle, in the iron rich Cauê Formation of the Itabira
Group. The mineralization occurs as friable, semi compact and
compact itabirites and banded hematite-silica rocks, with varying
degrees of weathering and oxidation. Currently, Serra Azul
mines and processes the friable itabirite with the Serra Azul
expansion project (see "—Capital expenditures") contemplating
the mining and processing of semi-compact and compact ores.
The Serra Azul mine also operates a processing plant consisting
of a crushing facility and a three-line concentration facility,
including screening, magnetic separation, spirals separators and
jigging. Iron ore product is transported by truck to two railway
terminals located 35 and 50 kilometers from the mine site for
distribution to local purchasers of sinter feed or for export
through third-party port facilities located in the Rio de Janeiro
State.
In 2021, an updated resource model was generated,
incorporating the results of a 1,508 meter drilling program
completed in late 2020. The drilling program targeted further
definition of the friable itabirite ("IF") ore bodies and the updated
model has been used to reassess the mine life for the current IF
phase of the Serra Azul Mine.
This resulted in a revised life of
mine for the IF phase, with mining operations extended until the
end of 2024. After finalizing the IF phase, the mine will pause its
production until the IC and ISC processing plant operations start
in second half of 2025.
Following the integration of the Serra Azul Mine into
ArcelorMittal Brasil in 2020, an expansion project for the Serra
Azul Mine was approved, extending the mine's life until 2058.
The project considers producing 4.5 million tonnes per annum of
DRI quality pellet feed by processing compact itabirite ("IC") and
semi-compact itabirite ("ISC") material. The IC and ISC
processing plant operations
are scheduled to start in the second
half of 2025
(see also "
—Capital expenditures).
In February 2019, the Company decided to implement the
evacuation plan related to its dormant Serra Azul tailing dam.
The community situated downstream to the dam was evacuated
as a precautionary measure based on an updated stability
report following incidents in the Brazilian mining sector. This was
done to enable further testing and implementation of any
additional mitigating measures. As a result, the Company has
executed an agreement with the Federal and State Public
Prosecutors Offices and affected families to provide temporary
assistance to the families and set technical measures required
to re-establish factor of safety standards. Such agreement was
extended in February 2020 and negotiations regarding
compensation continued in 2021, during which a
Complementary Agreement Term was signed with new
guidelines for compensation parameters for the impacts caused
by preventive evacuation.
As of December 31,
2024
, the
Company had entered into 942 indemnification agreements with
the affected families
.
The agreement contemplates the
construction of a check dam structure by the end of 2025
and
the tailing dam deconstruction by 2032.
80
|
Management report
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EUROPE
ArcelorMittal Prijedor is the only captive mining operation within the Europe segment.
|
% of
Ownership
Interest
|
2024
|
2023
|
2022
|
||||||||
|
ROM Millions
of Tonnes
|
Product
Millions of
Tonnes
|
ROM Millions
of Tonnes
|
Product
Millions of
Tonnes
|
ROM Millions
of Tonnes
|
Product
Millions of
Tonnes
|
||||||
|
ArcelorMittal Prijedor
|
51.0
|
||||||||||
|
At 100% basis
|
1.4
|
1.0
|
1.7
|
1.2
|
1.7
|
1.3
|
|||||
|
At ownership interest (51%)
|
0.7
|
0.5
|
0.9
|
0.6
|
0.8
|
0.7
|
|||||
ArcelorMittal Prijedor
The Omarska mine is a production stage surface iron ore mine
in Bosnia and Herzegovina, operated by ArcelorMittal Prijedor.
The mine is located 25 kilometers south-east of the town of
Prijedor. ArcelorMittal Prijedor was founded in 2004 as a
partnership between ArcelorMittal (at the time LNM Holdings)
with a 51% controlling interest and local mining company Iron
Ore Mine Ljubija owning the remaining 49% stake. ArcelorMittal
Prijedor is a captive mine of the Europe segment and supplies
all of its iron ore production to the ArcelorMittal Zenica steel
plant.
In 2022, ArcelorMittal Prijedor acquired additional mining and
land rights and started iron ore mining on a trial basis at Ljubija
Mine. Product from Ljubija mine is supplied to ArcelorMittal
Zenica steel plant where it is blended with the product from
Omarska mine.
The Omarska mine’s current concession was signed in 2018 for
a period of 6 years and the renewal process
is ongoing as of the
date of this annual report
.
The property comprises 1,946
hectares of land and mineral rights. The Ljubija mine’s current
concession was signed in 2022 for a period of 6 years,
with an
option to renew upon the expiry, in accordance with updated life
of mine
. The property comprises 739 hectares of land and
mineral rights. ArcelorMittal Prijedor is the registered holder of
the mining rights at the Omarska mine exploitation field. Land
tenure and mineral rights issued to ArcelorMittal Prijedor are
indefinite and considered to be of sufficient duration to enable all
reported mineral reserves on the properties to be mined in
accordance with current life of mine production schedules.
The Buvac deposit at the Omarska mine is located within
Carboniferous clastic (shale and sandstones) and carbonate
(limestone, dolomite, and ankerite) sequences, with massive
siderite-limonite mineralization forming an integral part of the
formation. Iron ore from the Buvac deposit is predominantly
limonite-goethite with associated quartz, carbonates, and
silicates of the illite type. The limonite-goethite mineralization
was formed during the oxidization of the upper parts of the
primary siderite bodies.
The ore body is asymmetrical, lens-shape and elongated in a
northeast - southwest direction, dipping at about 8° toward the
north-east from the surface to a depth of 210 meters. The
deposit is approximately 1.5 kilometer long and 1.0 kilometer
wide.
The Ljubija deposit is located within Carboniferous and
Permian-Triassic formation rocks which are partly covered by
thin Quaternary rocks. The ore within these formations is
primarily composed of siderite and ankerite with secondary
limonite iron facies.
The ore is excavated from the Omarska and Ljubija deposits by
traditional truck and shovel open pit mining methods. At the
Omarska mine, after a primary stage of crushing within the pit,
the ore is transported to a processing plant via a conveyor. The
processing plant on site performs crushing, screening, gravity
separation, magnetic separation and filtration. At the Ljubia
mine, ore is only crushed and screened.
81
|
Management report
|
Others
Iron ore mining operations forming part of Others include AMKR open pit and underground mines in Ukraine and Thabazimbi mine in
South Africa.
|
% of Ownership
Interest
|
2024
|
2023
|
2022
|
||||||||
|
ROM Millions
of Tonnes
1
|
Product
Millions of
Tonnes
1
|
ROM Millions
of Tonnes
|
Product
Millions of
Tonnes
|
ROM Millions
of Tonnes
|
Product
Millions of
Tonnes
|
||||||
|
AMKR Open Pit
|
95.1
|
||||||||||
|
At 100% basis
|
19.0
|
7.8
|
11.1
|
4.6
|
11.3
|
4.5
|
|||||
|
At the ownership interest
|
18.1
|
7.4
|
10.6
|
4.4
|
10.7
|
4.3
|
|||||
|
AMKR Underground
|
95.1
|
||||||||||
|
At 100% basis
|
0.2
|
0.2
|
0.3
|
0.3
|
0.4
|
0.4
|
|||||
|
At the ownership interest
|
0.2
|
0.2
|
0.3
|
0.3
|
0.3
|
0.4
|
|||||
|
ArcelorMittal Temirtau Open Pit (Lisakovsk,
Kentobe and Atansor)
1
|
100.0
|
||||||||||
|
At 100% basis
|
—
|
—
|
2.2
|
1.4
|
2.5
|
1.4
|
|||||
|
ArcelorMittal Temirtau Underground (Atasu)
1
|
100.0
|
||||||||||
|
At 100% basis
|
—
|
—
|
1.6
|
1.0
|
2.0
|
1.3
|
|||||
|
Others at 100% basis
|
19.2
|
8.0
|
15.2
|
7.3
|
16.2
|
7.6
|
|||||
|
Others at the ownership interest
|
18.3
|
7.6
|
14.7
|
7.1
|
15.5
|
7.4
|
|||||
1. The total production related to ArcelorMittal Temirtau is included in the table through the closing date of the sale of its operations on December 7, 2023.
ArcelorMittal Kryvyi Rih
AMKR is a production stage iron ore mining complex located
predominantly within the borders of the city of Kryvyi Rih, 150
kilometers southwest of Dnipro, Ukraine. The mine is 95.1%
owned by ArcelorMittal and is integrated into the ArcelorMittal
Kryvyi Rih steel business as a captive mine. ArcelorMittal
acquired the operations in 2005.
AMKR operates two open pits over the Novokryvorizke (Mine 2
on the map) and Valyavkinske (Mine 3 on the map) deposits,
and an underground mine at the high-grade iron ore deposit of
Kirova. Operations began at the Kryvyi Rih open pit mines in
1959 and at the Kryvyi Rih underground mine in 1933.
AMKR's operations control all of the mineral rights and surface
rights needed to mine and process its estimated iron ore
reserves, holding mineral rights over 775 hectares and surface
rights over 4,827 hectares to support its surface operations, and
57.9 hectares of mineral and 160 hectares of surface rights for
the underground mine operation. The subsoil use permits for the
underground mine were renewed in 2021 for the next 20 years,
and for the surface pits, mineral rights are due to expire in 2038,
with the land lease agreements being valid until 2060 and 2061,
respectively.
The iron ore deposits are located within the southern part of the
Krivorozhsky iron-ore basin. The iron mineralization at
Novokryvorizke and Valyavkinske deposits is hosted by early
Proterozoic rocks containing multiple altered ferruginous
quartzite strata with shale layers. The major iron ore bearing
units in the open pit mines have a carbonate-silicate-magnetite
composition. In addition, oxidized, iron-rich quartzite is mined
simultaneously with primary ore and is stored separately for
possible future processing.
Only the magnetite mineralization is
included in the 2024
open pit iron ore reserve estimates.
The
high-grade iron ore of the Kirova deposit is hosted by a
ferruginous quartzite with martite and jaspilite.
Along with the two open pit sites and an underground mine,
AMKR operates a concentrating facility and a crushing facility to
produce its final product. The iron ore extracted from the open
pits is crushed at the mine site through primary crushing, loaded
on a rail-loading facility and transported to the concentrator. The
concentration facility includes crushing, grinding, classification,
magnetic separation and filtering. The iron ore is extracted from
the underground mine by a modified sub-level caving method
and is crushed and screened at surface into lump and sinter ore,
before being transported by rail to the steel plant. The AMKR
steel plant is the main consumer of the mine’s products.
As a result of the ongoing war in Ukraine, iron ore production
was planned according to the consumption at AMKR steel plant
and logistics availability.
In 2024
, open pit iron ore production
was at approximately 75% of its maximum capacity (as
compared to approximately 45% in 2023). Mining at open pit
continued without stoppages in 2024. There have been
temporary stoppages at the underground mine in the first
quarter of 2023, the first quarter of 2024 and the underground
82
|
Management report
|
mine has been idled since September 2024, due to lower
demand for sinter ore.
In
2024,
i
ron ore production at the
underground mine
was at approximately 26
%
of its maximum
capacity (as compared to 40% in 2023)
.
South Africa
The Thabazimbi mine in the Limpopo Province of South Africa is
an exploration stage captive mine of ArcelorMittal South Africa
("AMSA") steel. AMSA took full ownership of the Thabazimbi
operations from Kumba Iron Ore in November 2018.
Open pit operations at Thabazimbi ceased in 2016, and the
mine is currently only engaged in the rehandling of iron ore from
stockpiles of ROM material from historical production.
The Thabazimbi mine holds surface right
s over 10,952.8
hectares and mineral rights over 8,662.3 hectares, valid until
2039.
Further studies to define mineral reserves and the life of
the mine will be undertaken in 20
25.
The Vanderbijl iron ore deposit at Thabazimbi, for which the
resources are estimated, is located on the northern margin of
the Transvaal sub-basin. The Transvaal Supergroup was
deposited in an open marine sedimentary basin developed on
the Kaapvaal Craton within fluvial, deltaic to marine depositional
environments. The iron ore deposits are developed at or close
to the transitional contact zone of the combined footwall
dolomites and upper transitional shale beds (including the
overlying an approximately 15 meter thick chert-rich shale layer)
of the Malmani Subgroup and the overlying BIFs of the Penge
Formation.
83
|
Management report
|
MINING
Iron ore mining operations forming part of the Mining segment include AMMC in Canada and AML in Liberia.
|
% of
Ownership
Interest
|
2024
|
2023
|
2022
|
||||||||
|
ROM
Millions of
Tonnes
|
Product
Millions of
Tonnes
|
ROM
Millions of
Tonnes
|
Product
Millions of
Tonnes
|
ROM
Millions of
Tonnes
|
Product
Millions of
Tonnes
|
||||||
|
AMMC
|
85.0
|
||||||||||
|
At 100% basis
|
63.8
|
24.2
|
65.3
|
22.4
|
66.9
|
24.1
|
|||||
|
At ownership interest (85%)
|
54.3
|
20.5
|
55.5
|
19.0
|
56.9
|
20.5
|
|||||
|
AML
|
85.0
|
||||||||||
|
At 100% basis
|
3.2
|
3.8
|
3.9
|
3.6
|
4.3
|
4.4
|
|||||
|
At ownership interest (85%)
|
2.7
|
3.2
|
3.3
|
3.0
|
3.6
|
3.8
|
|||||
|
Mining segment at 100% basis
|
67.0
|
28.0
|
69.2
|
26.0
|
71.2
|
28.5
|
|||||
|
Mining segment at the ownership interest
|
57.0
|
23.7
|
58.8
|
22.0
|
60.5
|
24.3
|
|||||
AMMC
AMMC is structured in two partnerships ArcelorMittal Mining
Canada G.P. and ArcelorMittal Infrastructure Canada G.P.,
which are both held at 85% by ArcelorMittal with a 15% non-
controlling interest held by 9404-5515 Québec Inc., a
consortium constituted, among others, of POSCO, South
Korean Steel Company and China Steel Corporation.
AMMC is a production stage property, including two deposits at
Mont-Wright and Fire Lake, and another deposit at Mont-Reed.
The mines at Mont-Wright and Fire Lake are operated by AMMC
and are both open-pit producing mines, consolidated in one
production schedule and life of mine supporting the AMMC
property's disclosed mineral reserves. The deposit at Mont-
Reed is currently in an exploration stage.
The Mont-Wright and Fire Lake deposits are located in Québec,
Canada. Mont-Wright is located near Fermont, and Fire Lake is
located 85 kilometers south-east of Fermont. The Mont-Reed
deposit is located approximately 130 kilometers southwest of
Mont-Wright. Along with the Mont-Wright and Fire Lake mines,
AMMC operates an ore processing plant located on-site at
Mont-Wright, as well as a pelletizing plant located at the Port-
Cartier port.
Headquarters of the mines are based in Greater Montreal.
Fermont, the town site built to support the mining operations, is
located 16 kilometers east of the Mont-Wright mining complex
and is connected by Highway 389 to Baie-Comeau, which is 570
kilometers away. The Mont-Wright and Fire Lake mines are
located approximately 400 kilometers north of the city of Port-
Cartier and approximately 1,000 kilometers north-east of
Montreal.
AMMC mining property comprises 38,748 hectares of mineral
rights across six mining leases, five patented parcels and 698
map designated claims. Patented parcels have no expiration
dates or lease fees whereas active leases are valid for a period
of ten years. All current leases expire between 2025 and 2033
and can be renewed as needed, with reports on material moved
disclosed to the government on a yearly basis.
The Mont-Wright, Fire Lake and Mont-Reed deposits are all
Lake Superior–type banded iron formations, the metamorphic
equivalent to other iron formations within the Labrador Trough
iron district. While Mont-Wright and Fire Lake are hematite-rich
deposits, Mont-Reed has a greater ratio of magnetite.
Mont-Wright and Fire Lake are surface pit producing mines, with
the mining operations carried out in conventional large-scale
open pits employing industry standard technology and
equipment to mine ore with grades averaging approximately
29% Fe.
All mined ore from Mont-Wright and Fire Lake is processed at
the Mont-Wright processing plant, with material from Fire Lake
brought in by train. Feed ore material is fed through the crusher
and concentrated in the processing plant in Mont-Wright using a
gravity separation method. Concentrate is shipped to Port-
Cartier, Québec, Canada, via private railroad, to the pelletizing
facilities and port operations. The main products sold are
concentrate and a variety of pellets.
AML
AML is an open-pit production stage property and has been
mining direct shipping ore ("DSO") from the Mt. Tokadeh, Mt.
Gangra, and Mt Yuelliton deposits in northern Liberia, since
2011. ArcelorMittal’s ownership of AML is 85%, with the
remaining 15% owned by the Liberia Government. The
construction of the mine commenced in 1960 by a group of
Swedish companies, which ultimately became the Liberian
American-Swedish Minerals Company (“LAMCO”), and
production commenced at the Nimba deposit in 1963. After
84
|
Management report
|
LAMCO ceased production in 1992, AML signed a Mineral
Development Agreement (MDA) in 2005 with the Liberian
Government. On December 28, 2006, AML signed the First
Amendment to the MDA with the Liberian Government. On
January 23, 2013, the parties signed the Second Amendment to
the MDA.
Under the MDA, AML is currently developing three deposits
located approximately 300 kilometers northeast of Monrovia,
Liberia. Three deposits within the MDA are grouped under the
name “Western Range Project”, which includes the Mt. Tokadeh,
Mt. Gangra and Mt Yuelliton deposits. The MDA, which is valid
until 2030, grants a concession area to AML of approximately
51,342 hectares within which AML has the rights to explore or
mine iron ore. Within the concession area, AML has a Class A
mining license for the Mt. Tokadeh, Mt. Gangra and Mt Yuelliton
deposits and a Mineral Exploration License for Mt. Blei and Mt
Detton. In addition to the rights to explore and mine iron ore, the
Liberian Government has granted the right to develop, use,
operate and maintain the Buchanan to Yekepa railroad and the
Buchanan port, along with an area at Buchanan for township
and industrial facilities for material handling and workshops.
The Nimba range consists of itabirites in a 250 to 450-meter-
thick recrystallized iron formation. Although the iron deposits at
Mt. Tokadeh, Mt. Gangra and Mt Yuelliton fit the general
definition of itabirite as laminated metamorphosed oxide-facies
iron formation, they are of lower iron grade than the ore
previously mined at the Nimba deposit. Tropical weathering
effects have caused the decomposition of the rock forming
minerals resulting in enrichment in the iron content that is
sufficient to support a DSO operation and accordingly, currently,
only high-grade ore reserves of oxidized iron ore are mined.
This ore only requires crushing and screening to make it
suitable for export. The materials-handling operation consists of
stockyards at both the mine and port areas, which are linked by
a 250-kilometer single track railway running from Mt. Tokadeh to
the port of Buchanan. The facilities at the port consist of tail
pulley platforms, a conveyor system, a quayside including bays
for iron ore storage, a fuel quayside jetty, an equipment
workshop and the final product storage. The final product is
primarily supplied to ArcelorMittal's steel plants in Europe, and
any product balance is shipped to the external European
market.
In 2013, AML began construction of a Phase 2 project that
targeted 15 million tonnes per annum of concentrate sinter fines.
This project was, however, suspended due to the onset of Ebola
in West Africa and the subsequent force majeure declaration by
the onsite contracting companies. AML completed a revised
feasibility study, which was updated in 2019-2020, to apply best
available technology and replace wet with dry stack tailings
treatment.
The Phase 2 expansion includes the construction of a
concentrator plant with the ability to beneficiate oxidized and
transitional ores and that targets 15
million tonnes
per annum of
premium iron ore concentrate.
Current plans aim to optimize the product mix and achieve a 20
million tonnes per annum production rate by the end of 2025.
For the first five years, this is done by blending concentrate with
5 million tonnes per annum of crushed blend ore, which
bypasses the concentrator. This crushed blend ore mixed with
concentrate makes it suitable for sinter feed. The plan is to
maintain these higher production rates, so ongoing studies are
exploring options to expand the resource base of crushed blend
ore, optimize mass recovery through the inclusion of regrinding
and flotation circuits for the tailings, and increase concentrator
capacity.
The concentrator phase, will transition AML to a premium
product category (high-grade concentrate) asset while achieving
a low FOB and CIF-China cost position (with the economies of
scale projected to more than offset the cost of concentration).
The expansion project, which encompasses processing, rail and
port facilities, is one of the largest mining projects in West Africa.
It is effectively a brownfield expansion, with 90% of the
procurement already completed (with the equipment on site)
and most civil works completed in 2024 (with minor areas still to
be concluded), with structural, mechanical, piping and platework
well progressed.
First concentrate was generated during
commissioning activities in the fourth quarter of 2024, full
completion and continuous production is expected in 2025.
The
revised feasibility study also contemplates a future change to
the processing infrastructure to enable the production of high-
quality concentrate from the magnetite dominant fresh ores
(Phase 3). See also "—Capital expenditures".
85
|
Management report
|
JOINT VENTURES AND ASSOCIATES
AMNS India is a joint venture in which ArcelorMittal and NSC hold a 60% and 40% interest, respectively.
|
% of
Ownership
Interest
|
2024
|
2023
|
2022
|
|||||||
|
ROM Millions
of Tonnes
|
Product
Millions of
Tonnes
|
ROM Millions
of Tonnes
|
Product
Millions of
Tonnes
|
ROM Millions
of Tonnes
|
Product
Millions of
Tonnes
|
|||||
|
AMNS India
|
60.0
|
|||||||||
|
At 100% basis
|
11.7
|
9.8
|
10.8
|
10.7
|
9.1
|
8.9
|
||||
|
At ownership interest (60%)
|
7.0
|
5.9
|
6.5
|
6.4
|
5.4
|
5.3
|
||||
Thakurani mine
AMNS India's Thakurani iron ore mine is a production stage
open pit mine in the Odisha state of India. AMNS India holds
surface and mineral rights over 228 hectares to support its
Thakurani operations, located 320 kilometers to the north of the
Odisha's capital Bhubaneswar and 4 kilometers east of the town
of Barbil.
The operation and mining rights to the Thakurani operations
were obtained by AMNS India in February 2020 through the
Indian Government Mining Block auction scheme. The
Thakurani open pit mine has been operated since 1961 and has
both mature mining pits and undeveloped resource areas.
AMNS India commenced mining operations in mid-2020,
following the demobilization of the previous claim holder,
Kaypee Enterprises.
AMNS India has a permit in place for 5.5 million tonnes per
annum of ore production. The ramp-up to a capacity of 5 million
tonnes per annum was completed in 2021. The mining lease
deed was granted in 2020 for a period of 50 years. Until June
2021, all production from the mine had to be consumed by
specified AMNS India end use plants, after which up to 25% of
production may be sold to a third party. The permitted
production rate was increased to 7.99 million tonnes per year
from 2023 after a submission approved by the Indian Bureau of
Mines in late 2020.
The Thakurani operations lie in the south-eastern part of the
Singhbhum-Keonjhar-Bonai iron ore belt, a narrow NNE-SSW
directional trending folded syncline that runs through northern
Odisha, India and southern Jharkhand, India. The Precambrian
horseshoe shaped belt is a well-known iron ore province hosting
many iron ore deposits. The enriched sequence is a traditional
Banded Iron Formation that has been subject to significant
weathering that has enriched the iron ore deposits. Ore is
generally of the friable hematite type, however more competent
hematite ores and friable goethite ores are also present.
The current mining operation at Thakurani is being carried out
by conventional mining methods using excavators and trucks for
ore transportation to a mobile crushing facility. Ore from the
Thakurani operation is crushed and screened on site before
being transported by road to the Dabuna beneficiation plant
located approximately 40 kilometers to the south. Beneficiated
material is then transported by slurry pipeline to the pelletizing
plant at Paradip, located on the coast of Bay of Bengal.
Ghoraburhani – Sagasahi mine
The Ghoraburhani – Sagasahi mine is a production stage open
pit iron ore mine, located in the Sundargarh district of Odisha,
state of India. The operation and mining rights to the
Ghoraburhani – Sagasahi operations were obtained through the
AMNS India takeover of Essar Steel India Limited (ESIL) in
December 2019. The mining lease deed was granted in 2021,
for a period of 50 years and permits production of up to 7.16
million tonnes per annum of ore primarily for captive usage.
AMNS India holds surface and mineral rights over 139 hectares
at the Ghoraburhani – Sagasahi mine.
The Ghoraburhani – Sagasahi operations lie in the south-
western part of the Singhbhum-Keonjhar-Bonai iron ore belt.
The enriched sequence is a traditional Banded Iron Formation
that has been subject to significant weathering and deformation
that has enriched the iron ore deposits. Ore is generally of
lateritic iron ore/hard laminated ore on the top followed by soft
laminated ore and friable hematite with intercalations of friable
shaly ore and limonitic ore are also present.
Ore mining commenced at the Ghoraburhani – Sagasahi mine
in 2021 by conventional mining methods, using excavators and
trucks for ore transportation to a mobile screening & crushing
facility, where ore is crushed and screened on site before being
transported by road to the Dabuna beneficiation plant located
approximately 28 kilometers to the south-east. Beneficiated
material is then transported by 253 kilometers slurry pipeline to
the pelletizing plant at Paradip.
86
|
Management report
|
Baffinland
ArcelorMittal has a non-controlling interest at the associate Baffinland iron ore mine.
|
% of
Ownership
Interest
|
2024
|
2023
|
2022
|
||||||||
|
ROM Millions
of Tonnes
|
Product
Millions of
Tonnes
|
ROM
Millions of
Tonnes
|
Product
Millions of
Tonnes
|
ROM
Millions of
Tonnes
|
Product
Millions of
Tonnes
|
||||||
|
Baffinland
|
25.23
|
||||||||||
|
At 100% basis
|
6.6
|
5.8
|
6.2
|
5.6
|
7.2
|
5.9
|
|||||
|
At ownership interest (25.23%)
|
1.7
|
1.5
|
1.6
|
1.4
|
1.8
|
1.5
|
|||||
The Mary River mine is a production stage open pit high-grade
iron ore mine. The mine is operated by Baffinland Iron Mines
Corporation, a privately owned Canadian mining company.
The Mary River property is located within the Arctic Circle on
north Baffin Island, in the Qikiqtani Region of Nunavut, Canada,
approximately 1,000 kilometers (620 miles) northwest of Iqaluit,
the capital of Nunavut. It comprises five high grade deposits and
six prospects, which represent high grade examples of Algoma-
type iron formation consisting of magnetite, hematite and
specular hematite mineralization. The project began commercial
production on Deposit No. 1 in 2014.
In March 2011, ArcelorMittal acquired 70% of the Mary River
mine project, with Nunavut Iron Ore Inc. (“NIO”), an affiliate of
The Energy and Minerals Group (“EMG”), owning the remaining
30%. In February 2013, ArcelorMittal and NIO entered into a
joint arrangement and equalized their shareholdings at 50/50.
Subsequently, following equity funding commitments and
conversion of preferred shares into equity, both exercised by
NIO only, ArcelorMittal’s share over time decreased to 25.70%
as of December 31, 2019 and 25.23% as of December 31,
2020. In September 2020, the corporate structure was
reorganized whereby NIO became the sole parent company of
Baffinland, while ArcelorMittal together with EMG became
shareholders of NIO. Following this reorganization, ArcelorMittal
retained its participation in the project and as of December 31,
2024, holds a 25.23% interest in NIO.
Baffinland’s total mineral tenures (including mining leases,
mineral claims and mineral exploration agreements) cover an
area of approximately
269,187 hectares (665,176 acres)
. Of
this, approximately 14% is subject to mining leases (being
leased claims under the Nunavut Mining Regulations), 79% is
covered by mineral claims (being recorded claims under the
Nunavut Mining Regulations) and the rest by mineral exploration
agreements.
Baffinland has two main operating locations – the mine site at
Mary River and Milne Port, located approximately 86 kilometers
north-west of the mine site. The Mary River mine is self-
sustaining and is equipped with an airstrip and aerodrome. It is
a conventional open pit truck and shovel operation. Ore is
delivered to crushers before the crushed product is transported
via the 100 kilometer Tote road to Milne Port. Milne Port has
been fully developed to accommodate a 5 million-tonne ore
stockpile, an ore dock, maintenance facility, and associated
infrastructure for the operation of the port facilities. Baffinland
can only ship during the open water season (typically July to
October), but may conduct haulage of ore to the port throughout
the year.
In 2023, Baffinland operated within an approved Early Revenue
Phase, which permitted up to 6.0 million tonnes per annum to be
hauled to and shipped from Milne Port. The current permitting
limit on trucking and shipping is 4.2 million tonnes per annum. In
September 2023, Baffinland obtained continued approval for an
increase to 6 million tonnes per annum for 2024.
Baffinland had approved a project involving the construction of a
railway to replace the existing truck-haul operation for the
transport of iron ore from Mary River to Milne Inlet, as well as
the expansion of mining, crushing and screening operations and
port ship loading capacity (the "Northern Rail Expansion").
On May 13, 2022, the Nunavut Impact Review Board (“NIRB”)
formally recommended that Baffinland’s proposed Northern Rail
Expansion not move forward at this time, citing potential
environmental impact concerns on the local wildlife and culture,
among other things. On November 16, 2022, the Minister of
Northern Affairs accepted the NIRB's recommendation, and
rejected Northern Rail Expansion.
Beginning in 2023, Baffinland’s expansion activities and related
capital expenditures have been primarily directed toward
expanding the mining and processing operations at the Mary
River mine site and connecting the mine site south to the
Steensby port (for which it has already obtained the major
permits) (the “Steensby Expansion”). Baffinland continues to
advance the financing plans for the Steensby Expansion and
expects the overall financing process to conclude in the second
half of 2025.
Vallourec Mineração Pau Branco Mine
In August 2024, ArcelorMittal completed the acquisition of a
28.4% equity stake (27.9% as at December 31, 2024) in the
associate Vallourec.
87
|
Management report
|
In Brazil, Vallourec extracts iron ore at its Vallourec Tubos do
Brasil SA (VBR) Pau Branco open pit mine and these operations
and structures are duly licensed. VBR's Mining Unit (formerly
Vallourec Mineração Ltda.) has been extracting iron ore at its
Pau Branco open pit mine since the early 1980s. The mine is
located in the city of Brumadinho in the State of Minas Gerais,
30 kilometers south of Belo Horizonte. Mining at Pau Branco
consists of hematite rich itabirite ore that is part of the iron
formations within the Minas Supergroup, Quadrilátero Ferifero
(Iron Quadrangle), Brazil. The Pau Branco mine produced 5
.4,
7.1 and 4.1 million tonnes of iron ore in 2024, 2023 and 2022,
respectively.
The mining operations were temporarily suspended in January
2022 due to flooding and damage to the Cachoeirinha waste
pile. However, operations were partially restarted in May 2022.
Vallourec requested the state mining and environmental
authorities to release the pile fully in the fourth quarter of 2022.
In May 2023, the Pau Branco iron ore mine resumed production
levels after receiving permits to operate the Cachoeirinha waste
pile.
Vallourec launched two projects aimed at improving the
profitability and durability of the Pau Branco mine.
Phase 1 was
expected to be completed at the end of 2024 with a total
investment of approximately €20 million.
Phase 2 was
scheduled for completion in 2027 and expected to cost between
€100 million and €125 million. Vallourec indicated that its
management was engaging with the state and national
authorities to obtain the required production and environmental
permits for this phase of work.
The Pau Branco mine concentrates and enriches the mined
hematite ore via jigs, spirals and magnetic separators to a +60%
Fe hematite product that it supplies to blast furnaces and the
pellet plant of Vallourec's affiliates located at Jeceaba in Minas
Gerais. The Jeceaba steel mill site is located 120 kilometers
south of Belo Horizonte and consists of a premium rolling mill; a
steel mill (with a blast furnace and electrical furnace), which
supplies steel bars for production at the Jeceaba and Barreiro
plants; a pellet unit that produces pellets used by the Jeceaba
blast furnaces and the local Brazilian market; and finishing lines.
The Barreiro site is an integrated unit that combines production
and hot rolling equipment for the tube finishing lines. Beyond
supplying Vallourec's own steel-making operation, the mine's
iron ore production is also sold to external customers.
The Pau Branco mine is classified as an “exploration stage
property”, as that term is defined under S-K 1300, because no
proven or probable mineral reserves have been determined in
accordance with S-K 1300. As a result, and even though the
Pau Branco mine has produced iron ore historically and is
expected to continue such production, the mine will remain
classified as an “exploration stage property”, as that term is
defined under S-K 1300, until such time as proven or probable
mineral reserves have been determined and disclosed in
accordance with S-K 1300. ArcelorMittal cannot guarantee that
proven or probable mineral reserves will be determined and
disclosed in accordance with S-K 1300 for the Pau Branco mine.
Estimates of Iron Ore Mineral Reserves and Mineral Resources
For the meanings of certain technical terms used in this annual
report, see “Glossary - definitions, terminology and principal
subsidiaries”.
The estimates of mineral resources and mineral reserves at the
Company’s mines and projects and the estimates of the mine
life included in this report have been prepared by qualified
persons, in accordance with the guidelines for mining property
disclosure requirements in accordance with S-K 1300. Qualified
persons are either employees of ArcelorMittal, or they are third
parties or employees of a third party who are not affiliates of
ArcelorMittal and neither such third parties or their employers
has an ownership, royalty or other interest in the property for
which they have estimated mineral reserves or mineral
resources. No qualified persons have been employed on a
contingent basis.
For additional information about the qualified
persons identified below, please see the exhibits to this annual
report.
Only measured and indicated mineral resources, where the level
of geological certainty associated was sufficient to allow a
qualified person to apply modifying factors in sufficient detail to
support mine planning and evaluation of the economic viability
of the deposit, were converted to proven or probable mineral
reserves for each of the mineral properties under the summary
disclosure.
The 2024 mineral resource and mineral reserve estimates at the
AMMC mining property have been prepared by qualified
persons who are employees of ArcelorMittal.
The 2024 mineral resource and reserve estimates for the Las
Truchas mine (consolidated as Mexico,
excluding Peña
Colorada in the tables below) were prepared by qualified
persons of SLR Consulting (Canada) Ltd. Peña Colorada also
contracted SLR Consulting (Canada) Ltd. to provide the 2024
mineral resource and reserve estimates for the Peña Colorada
mine, with the support of the Peña Colorada team.
The 2024 mineral resource and reserve estimates for the
Andrade and Serra Azul mines (consolidated as Brazil in the
tables below) were prepared by qualified persons of the GE21
Consultoria Mineral, with the support of the ArcelorMittal Brazil
local team.
The mineral resource and reserve estimates for the AMKR
(Ukraine) open pit and underground operations as of December
31, 2024 were prepared by LLC "KAI" with the support of the
AMKR team.
88
|
Management report
|
For 2024, mineral resource and reserve estimates for the
Thakurani and Ghoraburhani – Sagasahi mines (India in the
tables below) were prepared by a qualified person of
BMRC
Geomining Solutions PVT LTD
.
AML's 2024 mineral resources and mineral reserves were
estimated by qualified persons who are employees of
ArcelorMittal.
In 2024, a qualified person of VBKOM (Pty) Ltd updated the
mineral resources estimate for the Vanderbijl pit at Thabazimbi
(South Africa in tables below). Estimates of mineral reserves are
not reported in 2024 for ArcelorMittal South Africa iron ore
operation Thabazimbi.
Mineral resources and mineral reserves as of December 31,
2024 for ArcelorMittal Prijedor (Bosnia in the tables below) were
prepared by an independent qualified person.
The mineral resources and reserves for the Mary River Mine
(Baffinland in the tables below) as of December 31, 2024 were
calculated by annual depletion method by a qualified person
from Baffinland Iron Mines based on the original estimates of a
qualified person of SLR Consulting (Canada) Ltd.
The point of reference of reporting all of ArcelorMittal's mineral
resources and reserves in the tables below is in situ for
resources and the point of delivery of the ROM material to the
processing plant for reserves. All material is reported on a wet
basis and grades on a dry basis. The effective date for reporting
of all mineral resources and reserves is December 31, 2024.
For each of the mining operations under the summary
disclosure, economic viability of the declared mineral reserves
has been determined by the qualified persons using a
discounted cash flow analysis, demonstrating that extraction of
the mineral reserve is economically viable under reasonable
investment and market assumptions. The estimated mine life
reported in this table corresponds to the duration of the
production schedule of each operation based on the 2024 year-
end iron ore reserve estimates only. The production varies for
each operation during the mine life and as a result the mine life
is not the total reserve tonnage divided by the 2024 production.
Mine life of each operation is derived from the life of mine plans
and corresponds to the duration of the mine production
scheduled from mineral reserve estimates only. The
demonstration of economic viability is established through the
application of a life of mine plan for each operation or project
providing a positive net present value on a cash-forward looking
basis, considering the entire value chain. Economic viability is
demonstrated using forecasts of operating and capital costs
based on historical performance, with forward adjustments
based on planned process improvements, changes in
production volumes and in fixed and variable proportions of
costs, and forecasted fluctuations in costs of raw material,
supplies, energy and wages. Mineral reserve estimates are
updated annually in order to reflect new geological information
and current mine plan and business strategies. The Company’s
reserve estimates are of in-place material after adjustments for
mining depletion and mining losses and recoveries, with no
adjustments made for metal losses due to processing. For a
description of risks relating to reserves and reserve estimates,
see “Introduction—Risk factors—Risks related to ArcelorMittal’s
mining activities".
The reported iron ore reserves contained in this report do not
exceed the quantities that the Company estimates could be
extracted economically if future prices were at similar levels to
the average contracted price for the three years ended
December 31, 2024. The Company establishes optimum design
and future operating cut-off grade based on its forecast of
commodity prices, adjusted for local market conditions, freight,
inland logistics costs, and final product value in use premiums/
penalties, and operating and sustaining capital costs. The cut-off
grade varies from operation to operation and during the life of
each operation in order to optimize cash flow, return on
investments and the sustainability of the mining operations.
Such sustainability in turn depends on expected future operating
and capital costs. Estimates of reserves and resources can vary
from year to year due to the revision of mine plans in response
to market and operational conditions, in particular market price.
See “Introduction—Risk factors—Risks related to ArcelorMittal’s
mining activities—ArcelorMittal’s reserve and resource
estimates may materially differ from mineral quantities that it
may be able to actually recover; ArcelorMittal’s estimates of
mine life may prove inaccurate; and market price fluctuations
and changes in operating and capital costs may render certain
ore reserves uneconomical
to mine.”
To ensure that mineral resource estimates for all mines satisfy
the requirements for reasonable prospects for economic
extraction ("RPEE") requirement, reasonable technical and
economic factors were considered by qualified persons in the
process of derivation of the ultimate mineral resource pit shells
or underground constraining wireframes and other spatial
controls used to constrain the mineralization. Factors used are
current, considered to be reasonably developed, and are based
on generally accepted industry practice and experience.
Tonnage and grade estimates are reported as ‘Run of Mine’.
Tonnage is reported on a wet metric basis. Metallurgical
recoveries are accounted for in the concentrate tonnes
calculation based on historical processing data and are variable
as a function of head grade.
ArcelorMittal owns less than 100% of certain mining operations;
mineral reserve and mineral resource estimates have been
adjusted to reflect ownership interests and therefore reflect the
portion of total estimated mineral reserves and resources of
each mine attributable to ArcelorMittal as per the Company’s
ownership interest in each mine at December 31, 2024.
89
|
Management report
|
The classification of the iron ore reserve estimates as proven or
probable reflects the variability in the mineralization at the
selected cut-off grade, the mining selectivity and the production
rate and ability of the operation to blend the different ore types
that may occur within each deposit.
The following table summarizes ArcelorMittal’s mineral reserves
as of the end of the fiscal year ended December 31, 2024 in the
aggregate, and by commodity and country
and for certain
individual properties (each property containing 10% or more of
ArcelorMittal’s combined mineral reserves and certain properties
containing less)
. Mineral reserve quantities are rounded to
million tonnes. Unless indicated otherwise below, for the
purpose of determining iron ore mineral reserves, ArcelorMittal
has used a long-term iron ore reference price of
$70
per tonne
for 62% Fe fines, based on supply/demand fundamentals and
industry cost curve adjusted upwards or downwards for mine
specific factors and further adjusted for grade, logistics, and
other adjustments.
|
Iron Ore
|
% of
Ownership
Interest
12
|
Proven
Mineral Reserves
|
Probable
Mineral Reserves
|
Total
Mineral Reserves
|
|||||||
|
Millions of
Tonnes
|
% Fe
1
|
Millions of
Tonnes
|
% Fe
1
|
Millions of
Tonnes
|
% Fe
1
|
||||||
|
Canada
|
1,669
|
31.0
|
231
|
40.4
|
1,900
|
32.1
|
|||||
|
AMMC
2
|
85.0
|
1,580
|
29.1
|
155
|
28.8
|
1,735
|
29.1
|
||||
|
Baffinland
3
|
25.2
|
89
|
64.3
|
76
|
63.8
|
165
|
64.1
|
||||
|
Mexico
|
95
|
23.8
|
111
|
22.5
|
206
|
23.2
|
|||||
|
Mexico (Excluding Peña
Colorada)
4
|
100.0
|
40
|
28.7
|
44
|
27.7
|
84
|
28.2
|
||||
|
Peña Colorada - Mexico
5
|
50.0
|
55
|
20.2
|
67
|
19.2
|
122
|
19.7
|
||||
|
Brazil
6
|
100.0
|
173
|
46.4
|
251
|
37.2
|
424
|
40.9
|
||||
|
Bosnia
7
|
51.0
|
3
|
46.8
|
—
|
40.2
|
3
|
46.1
|
||||
|
Ukraine
|
62
|
35.1
|
430
|
34.1
|
492
|
34.2
|
|||||
|
Ukraine Open Pit
8
|
95.1
|
58
|
33.9
|
420
|
33.5
|
478
|
33.6
|
||||
|
Ukraine Underground
9
|
95.1
|
4
|
52.6
|
10
|
55.0
|
14
|
54.3
|
||||
|
South Africa
|
100.0
|
—
|
—
|
—
|
—
|
—
|
—
|
||||
|
Liberia
10
|
85.0
|
75
|
49.1
|
652
|
42.2
|
727
|
42.9
|
||||
|
India
11
|
60.0
|
6
|
63.3
|
73
|
62.6
|
79
|
57.6
|
||||
|
Total Iron Ore
|
2,083
|
32.8
|
1,748
|
38.8
|
3,831
|
35.4
|
|||||
1.
Unless stated otherwise, % Fe represents total Fe content for all sites except Peña Colorada where it represents magnetic Fe content only.
2.
Mineral reserves for AMMC are estimated at a cut-off grade of 15% and a mass recovery of 33.1%, for a life of mine of 27 years.
3.
Mineral reserves for Baffinland are estimated based on a long-term iron ore price of $102.8 per tonne for 62% Fe fines CFR North China, at a cut-off grade of 55% and a
mass recovery of 100%, for a life of mine of 23 years.
4.
Mineral reserves for Las Truchas are estimated at a cut-off grade of 10.96% Fe magnetic. The Fe recovery of Fe magnetic is 90%, for a life of mine of 13 years.
5.
Mineral reserves for Peña Colorada are estimated at the cut-off grade of 10% Fe magnetic. The average Fe recovery for the mineral reserves is 71% based on
Fet
met
allurgical recovery, for the life of mine of 16 years.
6.
Mineral reserves for Serra Azul are estimated at 40% Fe cut-off grade and a mass recovery of 52.8% for friable material, and 29% Fe cut-off grade and a mass recovery
varying from 33% to 45% for compact material,
for a life of mine of 34 years. Mineral reserves for Andrade are reported at a cut-off grade of 20% Fe and 81.3% mass
recovery at average, for a life of mine of 33 years.
7.
Mineral reserve for ArcelorMittal Prijedor is estimated based on a price of $39.9 per tonne of product calculated based on assumptions of a non-marketable material
supplied to its integrated steel plant, at 32% Fe cut-off grade and mass recovery of 73%, for the life of mine of 5 years.
8.
Mineral reserve for Ukraine Open Pit is estimated at an average mass recovery of 40.4%. Cut-off grade applied at Novokryvorizke deposit is 12% Fe, and at Valyavkinske
deposit 16% Fe. Life of mine considered for the two pits combined is 21 years.
9.
Mineral reserve for Ukraine Underground mine is estimated based on a price of $50.3 per tonne of product calculated based on assumptions of a non-marketable material
supplied to its integrated steel plant, at cut-off grade of 51.6% Fe and a mass recovery of 100%, for a life of mine of 21 years.
10.
Mineral reserves for Liberia are estimated at a cut-off grade of 40% Fe, with an average mass recovery of 57.2% for the oxide and transitional material, and at a 30% Fe
cut-off grade and a mass recovery of 43.2% for all fresh material, for a life of mine of 30 years.
11.
Mineral reserves for Thakurani and Ghoraburhani – Sagasahi are estimated using a long-term iron ore price of $42 per tonne based on IBM (Indian Bureau of Mines) ten
years forecasted price, Mineral reserves for Thakuranii are estimated at 55% Fe cut-off grade and a mass recovery of 95%, for the life of mine of 14 years. Mineral
reserves for Ghoraburhani – Sagasahi are estimated at 55% Fe cut-off grade and a mass recovery of 88.49%, for the life of mine of 12 years.
12.
As per S-K 1300, reported mineral reserves as of December 31, 2024 reflect ArcelorMittal's ownership interest at each individual business unit.
The following table summarizes ArcelorMittal’s mineral
resources as of the end of the fiscal year ended December 31,
2024 in the aggregate, and by commodity and country
and for
certain individual properties (each property containing 10% or
more of ArcelorMittal’s combined measured and indicated
mineral resources and certain properties containing less)
.
Mineral resource quantities are rounded to million tonnes. The
reported mineral resources reflect ArcelorMittal's ownership
90
|
Management report
|
interest at each individual business unit and are reported,
exclusive of mineral reserves, on a wet basis. Mineral resource
quantities are rounded to million tonnes. Iron ore mineral
resources are estimated based on the same long-term price
forecast used for reserves, adjusted based on the applicable
revenue factor and adjusted upwards or downwards for mine
specific factors and further adjusted for grade, logistics and
other modifying factors.
|
Iron Ore
|
% of
Ownership
Interest
13
|
Measured Mineral
Resources
|
Indicated
Mineral Resources
|
Measured &
Indicated Mineral
Resources
|
Inferred Mineral
Resources
|
|||||||||
|
Millions of
Tonnes
|
% Fe
1
|
Millions of
Tonnes
|
% Fe
1
|
Millions of
Tonnes
|
% Fe
1
|
Millions of
Tonnes
|
% Fe
1
|
|||||||
|
Canada
|
1,582
|
27.1
|
1,601
|
29.0
|
3,183
|
28.1
|
1,725
|
29.4
|
||||||
|
AMMC
2
|
85.0
|
1,582
|
27.1
|
1,598
|
28.9
|
3,180
|
28.0
|
1,642
|
27.7
|
|||||
|
Baffinland
3
|
25.2
|
—
|
62.1
|
3
|
63.0
|
3
|
62.9
|
83
|
64.3
|
|||||
|
Mexico
|
32
|
26.3
|
89
|
29.1
|
121
|
28.4
|
12
|
30.2
|
||||||
|
Mexico (Excluding Peña Colorada)
4
|
100
|
15
|
28.7
|
64
|
32.4
|
79
|
31.7
|
11
|
30.4
|
|||||
|
Peña Colorada - Mexico
5
|
50.0
|
17
|
24.2
|
25
|
20.8
|
42
|
22.2
|
1
|
28.4
|
|||||
|
Brazil
6
|
100
|
89
|
51.0
|
187
|
48.1
|
276
|
49.1
|
105
|
40.4
|
|||||
|
Bosnia
7
|
51.0
|
—
|
29.7
|
4
|
29.2
|
4
|
29.2
|
2
|
32.0
|
|||||
|
Ukraine
|
79
|
33.1
|
401
|
34.6
|
480
|
34.3
|
38
|
52.6
|
||||||
|
Ukraine Open Pit
8
|
95.1
|
77
|
32.5
|
387
|
33.8
|
464
|
33.6
|
6
|
36.7
|
|||||
|
Ukraine Underground
9
|
95.1
|
2
|
56.6
|
14
|
56.6
|
16
|
56.6
|
32
|
55.9
|
|||||
|
South Africa
10
|
100
|
—
|
—
|
38
|
54.4
|
38
|
54.4
|
43
|
54.9
|
|||||
|
Liberia
11
|
85.0
|
—
|
46.9
|
1,111
|
38.1
|
1,111
|
38.1
|
747
|
37.8
|
|||||
|
India
12
|
60.0
|
1
|
54.9
|
54
|
59.2
|
55
|
57.7
|
50
|
62.5
|
|||||
|
Total Iron Ore
|
1,783
|
28.6
|
3,485
|
34.3
|
5,268
|
32.4
|
2,722
|
33.5
|
||||||
1.
Unless stated otherwise, % Fe represents total Fe content for all sites except Peña Colorada where it represents magnetic Fe content only.
2.
Mineral resources for AMMC are estimated at a cut-off grade applied for all deposits is 15% Fe with a mass recovery of 32.2.%
3.
Mineral resources for Baffinland are estimated at the cut-off grade of 55% and a mass recovery of 100%.
4.
Mineral resources for Las Truchas are estimated at a cutoff grade of 10% Fe magnetic and Fe recovery of 90%.
5.
Mineral resources for Peña Colorada are estimated at the cut-off grade of 10% Fe magnetic. The average Fe recovery for the mineral resource is 77% based on Fe
metallurgical recovery.
6.
Mineral resources for Serra Azul are estimated at 40% Fe cut-off grade and a mass recovery of 52.8% for friable material, and 29% Fe cut-off grade and a mass recovery
varying from 33% to 45% for compact material. Mineral resources for Andrade are reported at a cutoff grade of 20% Fe and variable a mass recovery of 70.6% at
average.
7.
Mineral resources for ArcelorMittal Prijedor are estimated based on assumptions of a non-marketable material supplied to its integrated steel plant, at 30% Fe cut-off
grade and mass recovery of 73%.
8.
Mineral resources for Ukraine Open Pit are estimated at a cut-off grade applied at Novokryvorizke deposit is 12% Fe, and at Valyavkinske deposit 16% Fe, at an average
mass recovery of 40.4%.
9.
Mineral resources for Ukraine Underground mine are estimated based on assumptions of a non-marketable material supplied to its integrated steel plant, at a cut-off
grade of 51.6% Fe and a mass recovery of 100%.
10.
Mineral resources for Thabazimbi are estimated at a 40% Fe cut-off grade and metallurgical recovery of 60%.
11.
Mineral resources for Liberia are estimated at a cut-off grade of 40% Fe, with an average mass recovery of 57.2% for the oxide and transitional material, and at a 30% Fe
cut-off grade and mass recovery of 43.2% for all fresh material.
12.
Mineral resources for Thakurani are estimated at a 45% Fe cut-off grade and a mass recovery of 95%, and for Ghoraburhani – Sagasahi mine are estimated at a 45% Fe
cut-off grade and a mass recovery of 88.49%.
13.
As per S-K 1300, reported mineral resources as of December 31, 2024 reflect ArcelorMittal's ownership interest at each individual business unit.
Cautionary note concerning mineral reserve and mineral
resource estimates: With regards to ArcelorMittal’s reported
resources, investors are cautioned not to assume that any or all
of ArcelorMittal’s mineral deposits that constitute either
‘measured mineral resources’, ‘indicated mineral resources’ or
‘inferred mineral resources’ (estimated in accordance with S-K
1300) will ever be converted into mineral reserves. There is a
reasonable level of uncertainty as to the existence of ‘inferred
mineral resources’ and their economic and legal feasibility, and it
should not be assumed that any or all of an ‘inferred mineral
resource’ will be upgraded to a higher category.
Internal Controls
ArcelorMittal mining and exploration properties employ robust
quality control and quality assurance processes and procedures
to ensure the validity and integrity of data utilized in the
estimation of mineral resources and mineral reserves.
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ArcelorMittal has developed an Orebody Knowledge and
Management Framework, comprising a comprehensive set of
internal guidelines and management standards that govern the
resource and mining activities conducted at its properties. The
framework and its associated documents describe the systems
and processes to be developed and implemented at
ArcelorMittal properties to effectively manage activities and data
for the estimation and mining of its mineral resources and
reserves. This framework and its associated documents are
compiled and managed by a centralized corporate team of
experienced and qualified technical experts and are reviewed
and updated on a regular basis.
To increase rigor over internal controls and ensure integrity of its
reported mineral resource and mineral reserve disclosures
ArcelorMittal implements K2fly’s Mineral Resource Governance
and Model Manager platforms globally. This has enabled
enhanced control over the consolidation of the Company’s
mineral resource and reserves disclosures.
The K2fly solutions
were deployed in 2024 after a successful implementation and
configuration into the ArcelorMittal global mining portfolio and
are being used in conjunction with SK-1300 Reports.
Databases are compiled and managed by experienced
personnel engaged directly by the operating entities and
business units, following documented procedures. Sample data
derived from activities such as, but not limited to, exploration
drilling and field sampling, is subject to thorough sample security
and integrity protocols, field and laboratory quality assurance
and quality control processes, and data validation procedures.
Field quality control processes and procedures will vary based
on the specific nature of the drilling or sampling program, but will
nominally include the use of duplicate samples, blank control
samples and certified reference materials. Samples processed
and analyzed at internal and external laboratories are subject to
additional laboratory quality control processes including, but not
limited to, duplicate samples and certified reference materials.
Data verification workflows are employed for each program to
ensure the quality and integrity of all data incorporated into the
databases.
Historical data is subject to rigorous verification processes prior
to inclusion in resource estimation databases. These
procedures can include, but are not limited to, external database
validation by independent parties, internal database audits, and
spatial and statistical analyses. Where historical data cannot be
verified to the satisfaction of the relevant qualified person, it is
excluded from the databases used in the estimation processes.
Where applicable, all mineral resource and mineral reserve
estimates are reconciled against mine production data and
operational results. Geological interpretations and estimation
parameters are updated, and modifying factors, cost and price
assumptions validated and adjusted.
There are inherent risks associated with all mineral resource
and mineral reserve estimations see "Introduction—Risk Factors
—Risks associated with ArcelorMittal's Mining Activities".
OPERATING AND FINANCIAL REVIEW
Key factors affecting results of operations
Overview
The steel industry, and the iron ore and coal mining industries,
which provide its principal raw materials, have historically been
highly cyclical. They are significantly affected by general
economic conditions, consumption trends as well as by
worldwide production capacity and fluctuations in international
steel trade and tariffs. This is due to the cyclical nature of the
automotive, construction, machinery and equipment and
transportation industries that are the principal consumers of
steel.
In 2022, the global economy was adversely affected by supply
chain issues, high inflation, consequential tightening of
monetary policy and Russia’s invasion of Ukraine (itself
aggravating inflationary pressures, particularly in the energy
sector). All these shocks weighed on growth in ArcelorMittal’s
core developed markets (EU, U.S.), with a negative impact on
steel demand and pricing.
During 2023 and 2024, real steel
demand broadly stabilized at low levels in the core developed
markets with apparent demand supported somewhat by an end
to the destocking seen in 2022
. The lagged impact of monetary
tightening and weak real steel demand weighed on prices in the
core developed markets during the second half of 2023 and
through 2024, negatively impacting ArcelorMittal’s profitability.
While the economy and underlying real demand was stronger in
the U.S. relative to Europe during 2024, supported by continued
growth in consumer expenditure, the lagged impact of tighter
credit conditions and elevated interest rates negatively impacted
output of interest rate sensitive sectors (e.g., machinery and
residential construction), causing real steel demand to remain
subdued. The European market heavily impacts the Company's
prospects and economic growth has stagnated over the past 18
months Although, the European Central Bank has cut the
deposit interest rate, as inflation has fallen
th
e lagged impact of
prior elevated interest rates has negatively affected the
manufacturing and construction sectors that drive steel demand,
with new orders and backlogs weakening and real steel demand
declining during the second half of 2023 and through 2024. In
addition,
the recently announced imposition of tariffs on all steel
imports into the U.S. could result in retaliatory protectionist
measures by other countries and have a significant negative
impact on global trade and economic growth. In Europe, this
could potentially offset the positive impact of monetary policy
easing in the region and increase the risk of an economic
downturn. The automotive industry, which is a significant
consumer of steel, is likely to be negatively impacted by the
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tariffs and resulting higher steel prices.
More generally, tariffs
may result in renewed inflationary pressures in the U.S
. Tariffs
on
EU exports to the U.S. is also expected to negatively
impact
steel demand in EU as steel intensive manufactured goods
account for a significant proportion of the EU’s goods trade
surplus with the U.
S
. U.S. tariffs are also expected to have an
effect on supply and prices in the U.S. and the Company's other
markets (such as Canada and Mexico). See “Introduction—Risk
Factors and Control—Unfair trade practices, import tariffs and/or
barriers to free trade could negatively affect steel prices and
ArcelorMittal’s results of operations in various markets".
While steel demand in both the U.S. and EU continues to be
well below pre-pandemic levels, steel consumption has been
expected to be supported over the next few years by the
American Jobs Plan (“AJP”) and the Inflation Reduction Act
(“IRA”) in the U.S. and by the Next Generation EU (“NGEU”)
stimulus plans in the EU. However, beyond the impact of tariffs
mentioned above, the new U.S. administration's policies present
a significant downside risk to the additional steel demand from
the IRA, with some potential offset from hot rolled substrate for
additional pipe and tube demand from the oil sector.
Demand in some markets, such as Brazil rebounded during
2024, to well above pre-pandemic levels. Inflation has
accelerated in such markets, however, driven by resilient
domestic demand and by looser fiscal policy.
With inflation
above target, interest rates have been raised and further
monetary tightening is expected, negatively impacting
household consumption in 2025, which is expected to lead to
broadly stable steel demand in Brazil.
While many emerging
markets are better placed to deal with crises than in the past,
economic risks remained high through 2024 for many countries,
including
external foreign currency debt risk in Turkey and
Argentina
. This has led the Turkish lira to
depreciate
significantly
against the U.S. dollar, causing inflationary pressure to re-
accelerate and forcing the central bank to increase interest rates
to over 40%, causing a downturn in the economy and stagnating
steel demand in 2024.
Historically, demand dynamics in China have also substantially
affected the global steel business, mainly due to significant
changes in net steel exports. Continued weakness of Chinese
steel demand, coupled with ample domestic supply has seen
net Chinese finished flat steel exports increase from 3.4 million
tonnes per month during 2022, to
5.2
million per month during
2023, 6.1 million tonnes per month during the first half of 2024
and reaching record highs of 6.6 million tonnes per month
during the second half of 2024. In 2024, weak steel demand
was seen in the continued decline in housing sales in China,
reflecting low household confidence and with new housing starts
continuing to fall during 2024. The short-term outlook for China
remains largely dependent upon the timing and scale of the
cyclical rebound in the real estate market, the negative impact of
increased U.S. tariffs and the amount of government stimulus.
While the expectation is that further government stimulus will
support GDP growth in 2025, Chinese overcapacity and a need
to export is expected to remain across most industries.
Moreover, the Company continues to expect Chinese steel
demand to decline in the medium-term, as infrastructure
spending has been front-loaded and real estate demand is
expected to weaken structurally due to lower levels of rural-
urban migration. If the expected decline in demand does not
coincide with renewed capacity closures, this could lead to steel
exports from China remaining at or above current peak levels
and have a negative impact on global steel prices and spreads.
Unlike many commodities, steel is not completely fungible due
to wide differences in its shape, chemical composition, quality,
specifications and application, all of which affect sales prices.
Accordingly, there is still limited exchange trading and uniform
pricing of steel, whereas there is increased trading of steel raw
materials, particularly iron ore. Commodity spot prices can vary,
which causes sales prices from exports to fluctuate as a function
of the worldwide balance of supply and demand at the time
sales are made.
ArcelorMittal’s sales are made based on shorter-term purchase
orders as well as some longer-term contracts to certain
industrial customers, particularly in the automotive industry.
Steel price surcharges are often implemented on steel sold
pursuant to long-term contracts to recover increases in input
costs. However, l
onger term contracts with low steel prices
will
not reflect increases in spot steel prices that occur after contract
negotiation;
similarly low contract prices (if contract pricing is
renegotiated when steel prices are low, for example, steel
contracts that reset annually) will continue to affect results even
as spot steel prices increase
. Spot market steel, iron ore and
coal prices and short-term contracts are more driven by market
conditions.
One of the principal factors affecting the Company’s operating
profitability is the relationship between raw material prices and
steel selling prices. Profitability depends in part on the extent to
which steel selling prices exceed raw material prices, and
specifically the extent to which changes in raw material prices
are passed through to customers in steel selling prices.
Complicating factors include the extent of the time lag between
(a) the raw material price change and the steel selling price
change and (b) the date of the raw material purchase and of the
actual sale of the steel product in which the raw material was
used (average cost basis). In recent periods, steel selling prices
have not always been correlated with changes in raw material
prices, although steel selling prices may also be impacted
quickly due in part to the tendency of distributors to increase
purchases of steel products early in a rising cycle of raw
material prices and to hold back from purchasing as raw
material prices decline. With respect to (b), as average cost
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Management report
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basis is used to determine the cost of the raw materials
incorporated, inventories must first be worked through before a
decrease in raw material prices translates into decreased
operating costs. In some of ArcelorMittal’s segments, in
particular Europe and North America, there are several months
between raw material purchases and sales of steel products
incorporating those materials. Although this lag has been
reduced in recent years by changes to the timing of pricing
adjustments in iron ore contracts, it cannot be eliminated and
exposes these segments’ margins to changes in steel selling
prices in the interim (known as a “price-cost squeeze”). This lag
can result in inventory write-down
s, as occurred in 2022
due to
sharp declines in steel prices. In addition, decreases in steel
prices may outstrip decreases in raw material costs in absolute
terms, as has occurred numerous times
in the past
. Steel
spreads, especially in Europe, were compressed by elevated
energy prices, particularly gas, and destocking at stockers and
end-users through the second half of 2022, adversely impacting
the Company's deliveries and profitability. Steel prices declined
faster than raw material prices in both the third and fourth
quarters of 2022, with significant compression of spreads.
However, the fourth quarter of 2022 was the peak of the
destocking cycle and inventory levels across ArcelorMittal’s
main markets fell to low levels. As destocking began to end
during the first quarter of 2023, apparent demand improved from
the lows of the fourth quarter of 2022 and led to a recovery in
steel prices and spreads. However, with economic growth
weakening across the Company's core developed markets, due
to the lagged impact of interest rate rises, elevated steel prices
and spreads unwound during the second and third quarters of
2023, thus negatively impacting the results of the third and
fourth quarters of 2023, due to the significant lag between
transactions and deliveries, especially for flat products. Prices
and spreads in the Company's core markets remained relatively
weak through 2024, as apparent steel demand stabilized at
historically low levels in both Europe and the U.S.
Volatility on steel margins aside, the results of the Company’s
Mining segment (which sells externally as well as internally) are
directly impacted by iron ore prices.
See "
—Raw materials—Iron
ore"
. T
he Company believes current prices are unsustainable
over the medium term, if as expected, Chinese steel demand
weakens further, which would lead to further falls in iron ore
prices and negatively impact ArcelorMittal’s revenues and
profitability. See also “Introduction—Risk factors and control—
Risks related to the global economy and the mining and steel
industry—Prolonged low steel and (to a lesser extent) iron ore
prices, low steel demand and/or steel/iron ore oversupply would
have an adverse effect on ArcelorMittal’s results of operations.”
Economic environment
The global economy has undergone several years of negative
shocks, starting from COVID-19’s disruption in 2020-21,
followed by subsequent high inflation, exacerbated by the
Russian invasion of Ukraine in 2022, and to curb inflation, a
sharp rise in interest rates occurred
through
2023, particularly in
developed economies. As a result, global GDP growth slowed to
2.8% in 2023
, from 3.3% in 2022 and 6.5% in 2021.
During
2024, global growth remained stable, yet subdued. Inflation
continued to wane globally, making progress toward central
bank targets, even though price pressures persisted in some
developed countries during the first half of 2024, mainly due to
elevated services inflation. Global disinflation was also
supported by easing in labor market tightness during post-
pandemic recovery, which contained pressure from wage
inflation. The return of inflation to near central bank targets
could pave the way for easing monetary policy as a result. Since
June 2024, major central banks in advanced economies have
started to cut their policy rates, moving their policy stance
toward neutral. Overall, despite a sharp and synchronized
tightening of monetary policy around the world, the global
economy has remained resilient to elevated interest rates
throughout the disinflationary process, avoiding a global
recession in 2024. While specific pockets of weakness remain,
such as the industrial recession in developed economies and
real estate downturn in China, other offsetting factors, including
the relative strength of services and additional fiscal stimulus
from the Chinese government, have helped keep economic
growth relatively steady. As a result, global GDP growth only
slowed marginally to 2.7% in 2024.
After slowing to
2.5% in 2022 following the post COVID-19
rebound in 2021, U.S. GDP growth picked up to 2.9% in 2023,
despite higher interest rates and inflation. Overall, cautiously
loosening fiscal policy coupled with resilient consumption and
investment contributed to GDP growth remaining steady at
approximately 2.8% in 2024. With the new U.S. administration,
downside risk to growth in 2025 centers around policy
uncertainty, in particular rising trade tensions with trading
partners, as higher tariffs potentially add to domestic inflationary
pressure, becoming a drag on GDP growth.
After EU27 GDP growth slowed to 3.5% in 2022 due to a sharp
spike in energy prices, especially gas, following the Russian
invasion of
Ukraine,
GDP growth slowed to only 0.5% year-on-
year in 2023,
as the economy
weakened
in early 2023
, and
inflation rose far above target levels (resulting in increased
interest
rates)
. In 2024, economic activity, though no longer
weakening, stagnated at low levels due to the lagged impact of
high interest rates. The weakness of the industrial sector led to
EU27 GDP growth only increasing to an estimated 0.9% year-
on-year in 2024. Weaker growth led to inflation moderating and
allowed the ECB to start cutting interest rates in June 2024.
China’s economy has remained resilient despite the ongoing
property sector downturn since 2022. GDP growth of 5.2% in
2023 (as compared to 3% in 2022), was supported by fiscal
stimulus for infrastructure spe
nding,
resil
ient
private
94
|
Management report
|
consumption and higher manufacturing exports. These trends in
2023 largely continued during 2024. With
GDP
growth slowing
to 5% in 2024 (driven by real
estate
sector downturn). Despite
government monetary and fiscal stimulus in the real estate
sector, there is downside risk to 2025 growth from rising trade
tensions with the U.S.
In Brazil, GDP growth of 3.3% in 2024 (compared to 2.9% in
2023 and 3% in 2022) was driven by strong domestic demand
supported by wages growing above inflation, unemployment
falling and by looser fiscal policy. Rising debt sustainability
concerns toward the year-end and continued monetary policy
tightening in response to inflation, will likely weigh on growth in
2025.
In India, following strong growth of 7.7% in 2023, GDP growth in
2024 grew at an estimated 6.4% year-on-year, driven by
investment and supported by strong public investment,
particularly in infrastructure, and resilient consumption growth.
The level of public debt means public spending is unlikely to be
as strong going forward, but expected robust investment growth
and strong private consumption growth are expected to, support
solid economic growth.
After global apparent steel consumption (“ASC”) increased by
over 3% in 2021, as the global economy rebounded post-
pandemic, ASC declined by over 2% in 2022 due to weaker
demand from China caused by COVID-19 restrictions and a
destocking cycle in ex-China. In 2023, global ASC increased
slightly by approximately 0.2% year-on-year, with world ex-
China ASC growing by 2.1% year-on-year, offsetting an almost
2% decline in China, as persistent weakness in domestic real
estate sector negatively impacted steel demand. However,
weakness in the real estate sector in China worsened in 2024,
causing China ASC to decline further by more than 3% year-on-
year. Meanwhile, despite weak real demand in ex-China,
supportive real demand in emerging markets and restocking,
and strong exports from China helped ex-China ASC to grow
almost 2% year-on-year. Indeed, ASC in developing markets
grew an estimated 4% year-on-year, supported by strong growth
in India (10% year-on-year), followed by approximately 8% year-
on-year growth in Brazil offsetting weaker growth elsewhere. On
the other hand, ASC in developed markets is estimated to have
decreased slightly by 1% in 2024, largely driven by a decline of
3% year-on-year in ASC in "Developed Asia" (i
ncluding in
particular Japan, South Korea and Taiwan)
. EU27 steel demand
was broadly stable as inventory build was enough to offset
weaker real demand as the industrial recession continued. ASC
in the U.S. was also slightly down by approximately 0.5% year-
on-year, mainly driven by long products and pipe and tube. As a
result, ex-China ASC rose by almost 2% year-on-year. However,
ex-China growth was not enough to offset the decline in China,
leading to global ASC estimated to have decreased by
approximately 1% in 2024.
Source: GDP and industrial production data and estimates sourced from Oxford
Economics Jan 10, 2025. ASC data for U.S. from AISI to Nov 2024, estimates for
Dec 2024. ASC data for Brazil from Brazilian Steel Institute to Nov 2024, estimates
for Dec 2024. ASC data for EU27 from Eurofer to Oct 2024, estimates for Nov and
Dec 2024. All estimates are internal ArcelorMittal estimates. ASC data for India
from JPC to December 2024. All estimates are internal ArcelorMittal estimates.
Steel production
Global production declined to
1.88 billion tonnes in 2022 as
compared to 2021
, driven by lower production in world ex-China
resulting from high energy costs and the Russian invasion of
Ukraine. In China, lower production in 2022 reflected lower steel
demand, which was negatively impacted by COVID-19’s
exacerbation of the downturn in the real estate market.
This trend
in the
developed
market continued in 2023, but
stronger production in developing ex-China notably resulted in
world ex-China production being broadly stable relative to 2022.
Steel production in China rose by almost 1% year-on-year in
2023, leading to a surge in Chinese net steel exports (given the
slight decline in domestic demand).
Overall, global steel production in 2024 decreased marginally,
down almost 1% year-on-year. Steel production in world ex-
China was stable, as production in developed markets fell
slightly from weak levels, offset by stronger production in
developing markets. Production in the Company’s major
markets of Canada, the EU and the U.S. was stable, albeit at
weak levels, offset by declining production in developed Asia. In
2024, the situation in China was similar to 2023, with
government stimulus supporting infrastructure but only partially
offsetting an even sharper decline in the real estate sector. Steel
production declined less than the decline in domestic demand
resulting in increased Chinese net exports relative to 2023.
Source: Steel production data are compiled using World Steel data for 61 countries
for which monthly data is available (which together account for 97% of World
production). 61 countries Include: Austria, Belgium, Finland, France, Germany,
Greece, Italy, Luxembourg, Netherlands, Spain, Sweden, United Kingdom, Turkey,
Norway, Canada, Mexico, United States, Argentina, Brazil, Chile, Colombia,
Ecuador, Peru, Venezuela, Egypt, South Africa, Libya, Kazakhstan, Russia,
Ukraine, Iran, Saudi Arabia, United Arab Emirates, Japan, South Korea, Taiwan,
China, India, Pakistan, Thailand, Vietnam, Australia and New Zealand. Production
data is available for through December 2024, with some World Steel estimates for
missing data.
Trade and import competition
Europe
There has been a trend of imports growing more strongly than
domestic demand in the EU since 2012. In 2022, the Russian
invasion of Ukraine in February triggered an energy crisis in
Europe, causing both ASC and imports to decline sharply during
the second half of 2022. As a result, import penetration only
rose marginally to 20% in 2022.
In 2023, while subdued demand in Europe meant both ASC and
imports declined year-on-year, the decrease in imports was
slightly greater than the fall in ASC, which led to import
penetration declining slightly to 19%. In 2024, imports once
again increased, estimated at approximately 9% year-on-year.
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Strong import growth coupled with relatively stable demand has
pushed import penetration up to approximately
20% in 2024.
Source:
Eurostat imports and Eurofer ASC data to October
2024,
internal
Company estimates for November and December
2024
. All historical data now
refers to EU27 after UK left the European Union.
United States
Steel imports continued to increase strongly during 2022, with
the increase in imports (10% year-on-year) coupled with a
decline in steel demand leading to import penetration increasing
to over 23%. The weakening trend in imports since late 2022
continued through 2023, with imports falling by approximately
14% year-on-year while ASC only declined by approximately
3.5% year-on-year. The much sharper decline in imports pushed
import penetration down to approximately 21% in 2023. In 2024,
imports stopped falling and rose by an estimated 1.6% year-on-
year, while ASC (mainly long products, pipe and tube) continued
to decline by approximately 3%, leading import penetration to
rise slightly to 22%.
Source: American Iron and Steel Association total/regional imports data and ASC
data to November 2024, internal Company estimate for December 2024.
China
In 2022, Chinese finished steel exports were broadly stable, up
only 0.8% year-on-year to 67.4 million tonnes as compared to
66.9 million tonnes in 2021. With weak demand in China and a
large price gap to ex-China, Chinese finished steel exports
increased strongly in 2023, to 91.2 million tonnes, an increase of
approximately 25 million tonnes from 2022 levels. This trend
continued in 2024, with finished steel exports rising by 22%
year-on-year to 111 million tonnes for 2024. While most Chinese
exports are delivered to regions which are not core to the
Company’s business due to the protection of trade measures,
Chinese exports still negatively impact the Company both
directly and indirectly. See “Business overview—Government
regulations—Foreign trade” and “Introduction—Risk Factors and
Control—Risks related to the global economy and the mining
and steel industry—Unfair trade practices, import tariffs and/or
barriers to free trade could negatively affect steel prices and
ArcelorMittal’s results of operations in various markets.”
Source: General Administration of Customs of the People's Republic of China.
Steel
prices
In relation to flat products,
European hot rolled coil ("HRC")
prices (both Northern and Southern), U.S. domestic Midwest
HRC prices and Chinese HRC prices, VAT excluded, over the
2022-2024 period generally reflect a downward trend. Likewise,
in relation to long products, European medium and rebar prices
and Turkish rebar prices experienced a similar trend over this
period. Movements in these prices over this period have been
driven by a number of factors affecting demand and supply in
such markets, including
the effects of the war in Ukraine (started
at the end of February 2022), inflation, recessionary concerns,
supply chain constraints and labor shortages that weakened
manufacturing and demand in certain industries (including as a
result of COVID-19 restrictions), import levels and domestic mill
outages (e.g., for maintenance or otherwise).
|
Flat products
|
||||
|
Source: S&P
Global
Commodity
Insights
(Platts)
|
Northern
Europe
|
Southern
Europe
|
United
States
|
China
|
|
Spot HRC
average
price per
tonne
|
Spot HRC
average
price per
tonne
|
Spot HRC
average
price per
tonne
|
Spot HRC
average
price per
tonne, VAT
excluded
|
|
|
Q1 2022
|
€1,070
|
€1,005
|
$1,373
|
$701
|
|
Q2 2022
|
€1,115
|
€1,050
|
$1,434
|
$650
|
|
Q3 2022
|
€789
|
€757
|
$913
|
$512
|
|
Q4 2022
|
€653
|
€651
|
$767
|
$488
|
|
Q1 2023
|
€ 786
|
€ 767
|
$1,021
|
$551
|
|
Q2 2023
|
€ 764
|
€ 737
|
$1,161
|
$499
|
|
Q3 2023
|
€ 649
|
€ 636
|
$867
|
$482
|
|
Q4 2023
|
€ 650
|
€ 639
|
$1,010
|
$485
|
|
Q1 2024
|
€ 719
|
€ 706
|
$1,041
|
$492
|
|
Q2 2024
|
€ 633
|
€ 625
|
$858
|
$475
|
|
Q3 2024
|
€ 598
|
€ 597
|
$751
|
$416
|
|
Q4 2024
|
€ 556
|
€ 551
|
$774
|
$434
|
|
Long products
|
|||
|
Source: S&P
Global
Commodity
Insights (Platts)
|
Europe medium
sections
|
Europe rebar
|
Turkish rebar
|
|
Spot average
price per tonne
|
Spot average
price per tonne
|
Spot FOB
average price
per tonne
|
|
|
Q1 2022
|
€1,172
|
€928
|
$795
|
|
Q2 2022
|
€1,426
|
€1,220
|
$808
|
|
Q3 2022
|
€1,210
|
€981
|
$665
|
|
Q4 2022
|
€1,072
|
€814
|
$660
|
|
Q1 2023
|
€ 964
|
€ 722
|
$708
|
|
Q2 2023
|
€ 889
|
€ 649
|
$637
|
|
Q3 2023
|
€ 805
|
€ 577
|
$569
|
|
Q4 2023
|
€ 766
|
€ 606
|
$574
|
|
Q1 2024
|
€ 772
|
€ 633
|
$602
|
|
Q2 2024
|
€ 753
|
€ 610
|
$582
|
|
Q3 2024
|
€ 768
|
€ 615
|
$576
|
|
Q4 2024
|
€ 770
|
€ 595
|
$580
|
Raw materials
The primary raw material inputs for a steelmaker are iron ore,
coking coal, solid fuels, metallics (e.g., scrap), alloys, electricity,
natural gas and base metals. ArcelorMittal is exposed to price
volatility in each of these raw materials with respect to its
purchases in the spot market and under its long-term supply
contracts. In the longer term, demand for raw materials is
expected to continue to correlate closely with the steel market,
with prices fluctuating according to supply and demand
dynamics. Since most of the minerals used in the steelmaking
process are finite resources, their prices may also rise in
96
|
Management report
|
response to any perceived scarcity of remaining accessible
supplies, combined with the evolution of the pipeline of new
exploration projects to replace depleted resources.
As for pricing mechanisms, quarterly and monthly pricing
systems
are
the main type of contract pricing mechanisms
, but
spot purchases have gained a greater share, in particular since
2020, as steelmakers have developed strategies to benefit from
increasing spot market liquidity and volatility. Pricing is
generally linked to market price indexes and uses a variety of
mechanisms, including current spot prices and average prices
over specified periods. Therefore, there may not be a direct
correlation between market reference prices and actual selling
prices in various regions at a given time.
Iron ore
In 2022, iron ore market reference prices decreased to an
average of $120.03/t,
down
by 24.9% compared to an average
of $159.89/t in 2021, mainly due to collapsing market confidence
as China implemented strict lockdowns across the country
starting in mid-March, boycotts from homebuyers in China
resulting from failures to meet construction schedules which
weighed further on the crisis-stricken real estate sector, harsh
weather conditions in the summer and the US Federal
Reserve’s tightening of its monetary policy.
In 2023, iron ore market reference prices averaged $119.54/t,
relatively stable compared to an average of $120.03/t in 2022.
The first quarter of 2023 began with an increase in reference
prices mainly driven by prevailing bolstered sentiment on scrap
of COVID control in China, which was later counteracted by the
disappointing actual economy recovery, largely dragged by its
real estate woes and sliding exports. By the end of 2023, iron
ore market reference prices increased to $141.92/t on
December 27, a record high for the period dating back to June
9, 2022, driven by lower port inventory, stimulus anticipation and
strong demand outlook for Chinese economy in the first quarter
of 2024, following the deposits rate cut by Chinese commercial
banks on December 22, 2023.
In 2024, iron ore market reference prices dropped to an average
of $109.46/t, down by $10.08/t compared to an average of
$
119.54/t
in 2023. P
rices fell for the first three quarters of 2024
due to persistently sluggish demand amid economic weakness
generally and a real estate slowdown specifically, but recovered
slightly in the fourth quarter of 2024 on boosted sentiment from
stimulus policies
.
Coking coal
Coking coal prices in 2022 averaged $364.22/t as compared to
$227.29/t in 2021, driven by faster-than-expected demand
recovery, tight global supply and geopolitical tensions. Australia
confronted both heavy rainfall, which affected production and
logistics in Queensland, and a severe rise in COVID-19
pandemic cases. Russia’s invasion of Ukraine sent prices to
new records in March 2022. Prices increased in December 2022
as China neared lifting its ban on Australian coal imports.
Coking coal prices in 2023 averaged $295.97/t as compared to
$364.22/t in 2022. Although coking
coal price
s decreased
slightly in 2023, they still remained at a historic high at year end.
Supply disruption in Australia, caused by the wet season, port
maintenance, higher vessel queues, and lower production from
BHP, South 32, and Anglo due to longwall issues, coupled with
strong demand from India and China, kept the prices at an
elevated level. In the Chinese market, continuous mine
accidents and safety checks resulted in increased domestic
coking coal prices.
In 2024, coking coal prices averaged $241.32/t as compared to
$295.97/t in 2023, driven by weak global steel demand amid
increased supply due to eased weather-related disruptions
starting in the third quarter of 2024, despite the fire accident in
Anglo’s Grosvenor mine at the end of June 2024.
China reduced
its coal imports from seaborne Australian supply as Australian
prices lost competitiveness compared to falling Chinese
domestic coking coal prices
and Indian demand was muted due
to weakening margins of steel mills. China and India account for
almost 40%
of global demand for seaborne supply, and these
two countries are main participants in the global spot market.
ArcelorMittal has continued to leverage its iron ore and coking
coal supply chain and diversified supply portfolio as well as the
flexibility provided by contractual terms to mitigate regional
supply disruptions and also mitigate part of the market price
volatility.
|
Iron ore
|
Coking coal
|
|
|
Source: Metal
Bulletin
|
Reference average
price per tonne
(Delivered to China,
Metal Bulletin index,
62% Fe)
|
Reference average price
per tonne (premium hard
coking coal FOB
Australia index)
|
|
Q1 2022
|
141.61
|
487.09
|
|
Q2 2022
|
137.57
|
445.95
|
|
Q3 2022
|
103.47
|
250.96
|
|
Q4 2022
|
98.65
|
279.23
|
|
Q1 2023
|
125.28
|
342.52
|
|
Q2 2023
|
110.43
|
240.93
|
|
Q3 2023
|
114.00
|
264.37
|
|
Q4 2023
|
128.25
|
335.07
|
|
Q1 2024
|
123.58
|
308.76
|
|
Q2 2024
|
111.80
|
243.83
|
|
Q3 2024
|
99.75
|
211.44
|
|
Q4 2024
|
103.40
|
203.96
|
Scrap
The Company refers to the German suppliers’ index Delivered
at Place as its market reference.
97
|
Management report
|
The average
index
price for 2024 was €359/t as compared to
€365/t in 2023, a €6/t or 2% decrease compared to 2023. The
average price in 2022 was €409/t.
Turkey remains the main scrap buying country in the
international market.
Scrap Index HMS 1&2 CFR Turkey, North Europe origin, started
January 2024 at $414/t and reached the yearly low of $341/t in
December 2024. Scrap Index HMS 1&2 CFR Turkey, North
Europe origin, started January 2023 at $407/t and ended at
$415/t in December 2023 (after reaching $357/t in October
2023).
In 2024, the average prices for European domestic scrap price
of grade 3 were $389/t. In 2023, average European domestic
scrap prices of grade 3 were at $395/t.
In the domestic U.S. market, HMS 1 delivered Midwest index
decreased from an average of $349/t in 2023 to $330/t in 2024
and decreased from an average of $387/t in 2022 to $349/t in
2023. On the export market, HMS export FOB New York
average prices for 2024 were at $347/t, a decrease of $17/t
compared to 2023.
Ferro alloys and base metals
Ferro alloys
The underlying price driver for manganese alloys is ordinarily
the price of manganese ore, which was at the level of $5.53 per
dry metric tonne unit (“dmtu”) (for 44% lump ore) on Cost,
Insurance and Freight (“CIF”) China for 2024, representing a
5.93% increase from $5.22/dmtu in 2023 ($5.97/dmtu in 2022).
High carbon ferro manganese prices increased by 4% from
$1,244/t in 2023 to $1,292/t in 2024 ($2,042/t in 2022), silicon
manganese increased by 6% from $1,266/t in 2023 to $1336/t in
2024 ($2,123/t in 2022) and medium carbon ferro manganese
prices decreased by 2% from $1,832/t in 2023 to $1,790/t in
2024 ($3,332/t in 2022).
Base metals
Base metals used by ArcelorMittal are zinc, tin and aluminum for
coating, aluminum for deoxidization of liquid steel and nickel for
producing stainless or special steels. ArcelorMittal partially
hedges its exposure to its base metal inputs in accordance with
its risk management policies.
The average price of zinc for 2024 was $2,777/t, representing a
4.8% increase as compared to the 2023 average price of
$2,649/t (the 2022 average was $3,485/t).
The average price of tin for 2024 was $30,191/t, 16.6% higher
than the 2023 average of $25,895/t. In 2022 average was
$31,102/t).
The average price of aluminum for 2024 was $2,419/t,
representing a 7.4% increase compared to the 2023 average of
$2,252/t (the 2022 average was $2,707/t).
The average price of nickel for 2024 was $16,812/t,
representing a 21.7% decrease compared to the 2023 average
of
$21,474/t
(the 2022 average was $25,604/t).
Energy market and CO
2
Solid fuels, electricity and natural gas are some of the primary
energ
y inputs for a steelmaker. ArcelorMittal is exposed to price
volatility in each of these energy types with respect to its
purchases in the spot market and under its long-term supply
contracts.
Oil
Brent crude oil price averaged $79.86/bbl in 2024, a decrease of
$2.29/bbl as compared to 2023 which averaged at $82.15/bbl.
Brent crude oil prices in 2023 reflected a decrease of $16.9/bbl
compared to 2022, which averaged $99.05/bbl.
Brent crude oil price volatility over the 2022-2024 period has
been exacerbated by a number of geopolitical and
macroeconomic factors, including the war in Ukraine, conflicts in
the Middle East, production decisions by Organization of
Petroleum Exporting Countries ("OPEC") and other countries,
embargoes on Russian oil, monetary policy (including by the
U.S. Federal Reserve), economic growth or weakness and
general perception over the economic outlook.
CO
2
The average price for one tonne of CO
2
emitted in 2024
decreased by 21.9% compared to 2023 and reached €66.5 per
ton of carbon dioxide equivalent ("/tCO
2
e”). The average price
for one tonne of CO
2
emitted in 2023 increased by 4.9%
compared to the previous year.
Variations in the price per ton of carbon dioxide equivalent is
driven by a number of factors, including compliance buying,
temperatures and natural gas prices and storage levels
(impacting level of power generation from coal power plants
).
Because the integrated steel process leads to substantial CO
2
emissions, costs related to EUAs and the fluctuations in EUA
prices can significantly affect the Company’s costs of
production. The Company recognized a CO
2
emission obligation
provision of $420 million at December 31, 2024 with respect to
its shortfall. See note 9.1 to the consolidated financial
statements. The Company also uses derivative financial
instruments to manage its exposure to fluctuations in prices of
emission rights allowances from time to time. See note 6.3 to
the consolidated financial statements for further information.
98
|
Management report
|
The following table shows quarterly average prices of oil and
CO
2
for the past three years:
|
Commodities
|
||
|
Source: Thomson
Reuters
|
Brent crude oil
spot average price $
per barrel
|
European Union
allowance
average price
€ per ton of CO
2
e
|
|
Q1 2022
|
97.90
|
83.21
|
|
Q2 2022
|
111.98
|
83.85
|
|
Q3 2022
|
97.70
|
80.04
|
|
Q4 2022
|
88.63
|
77.95
|
|
Q1 2023
|
82.10
|
89.92
|
|
Q2 2023
|
77.73
|
88.57
|
|
Q3 2023
|
85.92
|
85.69
|
|
Q4 2023
|
82.85
|
76.85
|
|
Q1 2024
|
81.76
|
61.67
|
|
Q2 2024
|
85.03
|
69.65
|
|
Q3 2024
|
78.71
|
68.36
|
|
Q4 2024
|
74.01
|
66.38
|
Natural gas
In Europe, the overall spot price (or TTF) average for natural
gas in 2024 was €34.9/MWh, a 15% decrease in comparison to
previous year. In 2023, natural gas prices averaged at €40.9/
MWh, a 66% decrease in comparison to 2022. TTF prices over
the 2022-2024 have been impacted by a number of factors,
including the invasion of Ukraine (and the German government’s
decision not to proceed with the Russian-backed Nord Stream 2
project) and other geopolitical tensions and conflicts (e.g., in the
Middle East), imports of liquefied natural gas ("LNG") (e.g., from
the U.S.), temperatures, maintenance of pipelines, inventory
levels, coal prices. Russian transit gas into Europe ceased at
the end of 2024, which is expected to have an impact on 2025.
In the U.S., Henry Hub (“HH”, the main gas hub in Louisiana)
prices in 2024 dropped to an average of $2.4/MMBtu, a 10%
year-on-year decrease as compared to $2.7/MMBtu in 2023. In
2023, HH average natural gas prices fell to $2.7/MMBtu, a 59%
decrease compared to 2022. HH prices over the 2022-2024
have been impacted by a number of factors, including
disruptions in gas production (e.g., from severe weather events
or fires), increased LNG production capacity, demand for LNG
exports (including from Europe), inventory levels and
temperatures.
In 2024, the Japan Korea Marker ("JKM", the LNG benchmark
price assessment for spot physical cargoes delivered ex-ship
into Japan, South Korea, China and Taiwan) average price
dropped to $11.9/MMBtu, a 17% decrease compared to 2023.
The JKM average price of $14.4/MMBtu in 2023 represented a
58% decrease compared to 2022. JKM prices over the
2022-2024 have been impacted by a number of factors,
including the invasion of Ukraine and other geopolitical tensions
(e.g., Middle East), temperatures, ability to switch to oil and
domestic gas consumption, Chinese demand (suppressed by
COVID-19 outbreaks), inventory levels, demand from outside of
Asia (e.g., Europe), LNG supply from outside of Asia (e.g.,
U.S.), adverse weather events (e.g., cyclones) and outages at
production facilities.
The following table shows quarterly average spot prices of
natural gas for the past three years:
|
Natural gas
|
EEX PEGAS
|
Reuters
|
Reuters
|
|
Period
|
TTF
Spot average
price
€ per MWh
|
Henry Hub
Spot average
price
$ per MMBtu
|
JKM
Spot average
price
$ per MMBtu
|
|
Q1 2022
|
95.10
|
4.59
|
30.83
|
|
Q2 2022
|
98.55
|
7.50
|
27.18
|
|
Q3 2022
|
198.19
|
7.95
|
46.84
|
|
Q4 2022
|
94.27
|
6.09
|
31.23
|
|
Q1 2023
|
53.31
|
2.74
|
18.07
|
|
Q2 2023
|
35.29
|
2.33
|
11.08
|
|
Q3 2023
|
33.49
|
2.66
|
12.59
|
|
Q4 2023
|
41.01
|
2.92
|
15.82
|
|
Q1 2024
|
27.50
|
2.10
|
9.42
|
|
Q2 2024
|
31.82
|
2.32
|
11.10
|
|
Q3 2024
|
35.65
|
2.23
|
13.00
|
|
Q4 2024
|
43.30
|
2.98
|
13.91
|
Electricity - Europe
Due to the regional nature of electricity markets, prices follow
mainly local drivers (i.e., energy mix of the respective country,
power generation from renewables such as nuclear, country
specific energy policies, etc.), as well as temperatures and
natural gas prices (positively correlated).
In 2022, electricity prices reached new highs amid high natural
gas prices.
In 2023 power prices mainly followed the same trend as natural
gas prices.
In 2024, European power demand remained at the lower end of
the 7-year range due to mild weather and availability of power
generation from renewables.
The following table shows quarterly average spot prices of
electricity in Germany, France and Belgium for the past three
years:
99
|
Management report
|
|
Electricity
|
|||
|
Source: EEX
|
Germany
Baseload spot
average price
€ per MWh
|
France
Baseload spot
average price
€ per MWh
|
Belgium
Baseload spot
average price
€ per MWh
|
|
Q1 2022
|
184.62
|
232.19
|
208.02
|
|
Q2 2022
|
186.98
|
225.99
|
193.92
|
|
Q3 2022
|
375.75
|
429.73
|
372.27
|
|
Q4 2022
|
192.84
|
214.15
|
202.62
|
|
Q1 2023
|
115.80
|
130.33
|
127.40
|
|
Q2 2023
|
92.29
|
91.58
|
92.81
|
|
Q3 2023
|
90.78
|
85.71
|
87.14
|
|
Q4 2023
|
82.27
|
81.22
|
82.36
|
|
Q1 2024
|
67.67
|
62.94
|
67.20
|
|
Q2 2024
|
71.76
|
29.83
|
54.09
|
|
Q3 2024
|
75.99
|
51.14
|
62.20
|
|
Q4 2024
|
102.65
|
86.77
|
97.23
|
Ocean freight
Transportation costs, particularly shipping, constitute a principal
input cost. Shipping freight rates vary depending on several
factors, such as demand (including from China), positional
tonnage deficits relative to demand in both the Atlantic and
Pacific basins, weather conditions, water levels in the Panama
Canal and fleet growth. Moreover, the relatively new ETS
regulations that entered into force at the start of 2024 continue
to have an impact on the market as average vessel speeds
dropped to comply with the stricter environmental requirements
and to limit costs.
The Baltic Dry Index (“BDI”) (an index of average prices paid for
transport of dry bulk materials) average was at 1,378 points in
2023 compared to 1,934 points in 2022. The Capesize sub-
index (cargoes of about 150,000 tonnes) increased by 1.31%
year-on-year to an average of $16,389/day in 2023 compared to
$16,177/day in 2022. The Panamax sub-index (cargoes of about
60-70,000 tonnes) decreased by 38.01% to an average of
$12,854/day as compared to $20,736/day in 2022. In 2023, the
Supramax sub-index (cargoes of about 48-60,000 tonnes) fell to
an average of $11,240/day as compared to $22,152/day in
2022, a 49.26% decline.
The BDI average was at 1,755 points in 2024 compared to
1,378 points in 2023. The Capesize index increased by 37.8%
year-on-year to an average of $22,592/day in 2024 compared to
$16,389/day in 2023. The Panamax index increased by 9.7% to
an average of $14,099/day as compared to $12,854/day in
2023. In 2024, the Supramax index increased to an average of
$13,600/day as compared to
$11,240
/day in 2023, a 21%
increase.
Sources: Baltic Index, Clarksons Platou
Impact of exchange rate movements
Because a substantial portion of ArcelorMittal’s assets, liabilities,
sales and earnings are denominated in currencies other than
the U.S. dollar (its reporting currency), ArcelorMittal has
exposure to fluctuations in the values of these currencies
relative to the U.S. dollar. These currency fluctuations,
especially the fluctuation of the U.S. dollar relative to the euro,
as well as fluctuations in the currencies of the other countries in
which ArcelorMittal has significant operations and sales, can
have a material impact on its results of operations. For example,
ArcelorMittal’s subsidiaries may purchase raw materials,
including iron ore and coking coal, in U.S. dollars, but may sell
finished steel products in other currencies. Consequently, an
appreciation of the U.S. dollar will increase the cost of raw
materials; thereby having a negative impact on the Company’s
operating margins, unless the Company is able to pass along
the higher cost in the form of higher selling prices. In order to
minimize its currency exposure, ArcelorMittal enters into
hedging transactions to lock-in a set exchange rate, as per its
risk management policies.
Since April 1, 2018, the Company has designated a portfolio of
euro denominated debt (
€4.1 billion
as of December 31, 2024)
as a hedge of certain euro denominated investments (
€8.2
billion
as of December 31, 2024) in order to mitigate the foreign
currency risk arising from certain euro denominated subsidiaries
net assets. The risk arises from the fluctuation in spot exchange
rates between the euro and U.S. dollar, which causes the
amount of the net investments to vary. See also note 6.3 to the
consolidated financial statements. As a result of the hedge
designation, foreign exchange gains and losses related to the
portfolio of euro denominated debt are recognized in other
comprehensive income.
As of December 31, 2024, the Company is mainly subject to
foreign exchange exposure relating to the euro, Brazilian real,
Canadian dollar, Indian rupee, South African rand, Mexican
peso, Polish zloty, Argentinian peso and Ukrainian hryvnia
against the U.S. dollar resulting from its payables, receivables or
foreign operations denominated in such currencies.
Critical accounting policies and use of judgments and estimates
Management’s discussion and analysis of ArcelorMittal’s
operational results and financial condition is based on
ArcelorMittal’s consolidated financial statements, which have
been prepared in accordance with IFRS. The preparation of
financial statements in conformity with IFRS recognition and
measurement principles and, in particular, making the critical
accounting judgments highlighted below require the use of
estimates and assumptions that affect the reported amounts of
assets, liabilities, revenues and expenses. Management reviews
its estimates on an ongoing basis using currently available
information. Changes in facts and circumstances or obtaining
100
|
Management report
|
new information or more experience may result in revised
estimates, and actual results could differ from those estimates.
An overview of ArcelorMittal's critical accounting policies under
which significant judgments, estimates and assumptions are
made may be found in note 1.3 to the consolidated financial
statements.
Legal proceedings
ArcelorMittal is currently and may in the future be involved in
litigation, arbitration or other legal proceedings. Provisions
related to legal and arbitration proceedings are recorded in
accordance with the accounting policies described in note 9.1 to
ArcelorMittal’s consolidated financial statements. Please refer to
note 9.3 for a description of contingencies, including legal
proceedings.
Operating results
The following discussion and analysis should be read in
conjunction with ArcelorMittal’s consolidated financial
statements included in this annual report.
As from January 1, 2024, ArcelorMittal implemented changes to
its organizational structure. India and joint ventures are
presented as a new operating segment including the joint
ventures AMNS India, VAMA and AMNS Calvert
as
well as all
other associates, joint ventures ("JVs") and other investments;
the results of these entities are included in the line “Investments
in associates, joint ventures and other investments" and
discussed in such section. The segment Sustainable Solutions
is composed of a number of niche, capital light businesses
playing an important role in supporting climate action (including
renewables, special projects and construction business), which
were previously reported within the Europe segment and are
now reported as a separate operating segment. The NAFTA
segment has been renamed North America. Finally, following
the sale of the Company’s operations in Kazakhstan, the
remaining operations of the former ACIS segment, i.e.
ArcelorMittal Kryvyi Rih and ArcelorMittal South Africa, were
assigned to Others. Segment disclosures have been recast to
reflect this new segmentation in conformity with IFRS.
ArcelorMittal reports its operations in six reportable segments:
North America, Brazil, Europe, India and JVs, Sustainable
Solutions and Mining, with the remainder of its operations in
“Others”. The key performance indicators that ArcelorMittal’s
management uses to analyze operations are sales, average
steel selling prices, crude steel production, steel shipments, iron
ore production and operating income. Management’s analysis of
liquidity and capital resources is driven by net cash flow from
operations and capital expenditures.
Years ended December 31, 2024, 2023 and 2022
Sales, operating income, crude steel production, steel shipments, average steel selling prices
and mining production
The following tables provide a summary of ArcelorMittal’s performance by reportable segment for the years
ended
December 31, 2024,
2023 and 2022:
|
Sales for the year ended December 31,
1
|
Operating income (loss) for the year ended December 31
|
||||||||||
|
2024
|
2023
|
2022
|
2024
|
2023
|
2022
|
||||||
|
Segment
|
(in $ millions)
|
(in $ millions)
|
(in $ millions)
|
(in $ millions)
|
(in $ millions)
|
(in $ millions)
|
|||||
|
North America
|
11,896
|
12,978
|
13,774
|
1,310
|
1,917
|
2,818
|
|||||
|
Brazil
|
12,401
|
13,163
|
13,732
|
1,399
|
1,461
|
2,775
|
|||||
|
Europe
|
29,952
|
31,695
|
39,639
|
386
|
879
|
3,521
|
|||||
|
India and JVs
|
—
|
—
|
—
|
—
|
—
|
—
|
|||||
|
Sustainable Solutions
|
10,722
|
11,467
|
13,658
|
57
|
225
|
778
|
|||||
|
Mining
|
2,663
|
3,077
|
3,396
|
770
|
1,144
|
1,483
|
|||||
|
Others and eliminations
|
(5,193)
|
(4,105)
|
(4,355)
|
(612)
|
(3,286)
|
(1,103)
|
|||||
|
Total
|
62,441
|
68,275
|
79,844
|
3,310
|
2,340
|
10,272
|
|||||
1.
Amounts are prior to inter-segment eliminations (except for total) and sales include non-steel sales.
101
|
Management report
|
|
Others and eliminations
|
Year ended December 31,
|
||||
|
2024
|
2023
|
2022
|
|||
|
(in $ millions)
|
(in $ millions)
|
(in $ millions)
|
|||
|
Corporate and shared services
1
|
(271)
|
(296)
|
(235)
|
||
|
Financial activities
|
(22)
|
(22)
|
(19)
|
||
|
Other
2
|
(125)
|
(236)
|
465
|
||
|
Shipping and logistics
|
6
|
5
|
12
|
||
|
Intragroup stock margin eliminations
|
30
|
91
|
105
|
||
|
Depreciation
|
(193)
|
(321)
|
(405)
|
||
|
Impairment of property, plant and equipment
|
(37)
|
(844)
|
(1,026)
|
||
|
Loss on disposal of Kazakhstan operations
|
—
|
(1,663)
|
—
|
||
|
Others and eliminations
|
(612)
|
(3,286)
|
(1,103)
|
||
1.
Includes primarily staff and other holding costs and results from shared service activities.
2.
Including
operating income (loss) before depreciation and impairment of property, plant and equipment of the Company's operations in Ukraine and South Africa (and
in
Kazakhstan
in 2022 and 2023 until disposal on December 7, 2023).
Shipments and average steel selling price
ArcelorMittal steel shipments decreased by
2.4%
to
54.3
million
tonnes for the year ended December 31, 2024 as compared to
steel shipments of 55.6 million tonnes for the year ended
December 31, 2023.
On a comparable basis, excluding the shipments from
ArcelorMittal Pecém (consolidated from March 9, 2023) and
A
rcelorMittal's Kazakhstan operations
(sold on December 7,
2023), steel shipments in 2024 were 1.7% higher as compared
to 2023.
ArcelorMittal steel shipments remained relatively stable at 55.6
million tonnes for the year ended December 31, 2023 as
compared to steel shipments of 55.9 million tonnes for the year
ended December 31, 2022.
On a comparable basis, excluding the shipments from
ArcelorMittal Pecém (consolidated from March 9, 2023) and
ArcelorMittal's Kazakhstan operations (sold on December 7,
2023), steel shipments in 2023 were impacted by production
cuts and outages during the year in Europe, offset in part by
improved North America volumes, and declined by 4.5% as
compared to 2022.
Steel shipments decreased
4.6%
to
27.3
million tonnes for the
first half of 2024, as compared to
28.7
million tonnes for the first
half of 2023. On a scope adjusted basis (i.e. excluding
ArcelorMittal's Kazakhstan
operations and ArcelorMittal Pecém),
steel shipments in the first half of 2024 decreased by 1.1% as
compared to the first half of 2023. Steel shipments remained
stable at
26.9
million tonnes in the second half of 2024
compared to 27.0 million tonnes in the second half of 2023, and
increased
4.6%
on a scope adjusted basis excluding
Kazakhstan operations.
Steel shipments decreased 3.6% to 28.7 million tonnes in the
first half of 2023 as compared to 29.7 million tonnes for the first
half of 2022. Excluding the shipments of ArcelorMittal Pecém
(consolidated from March 9, 2023), steel shipments in the first
half of 2023 declined by 6.8% as compared to the first half of
2022 (impacted by outages in Europe and lower demand in
Brazil, including exports). Steel shipments increased 2.9% to
27.0 million tonnes in the second half of 2023 compared to 26.2
million tonnes in the second half of 2022, mainly due to the
shipments of ArcelorMittal Pecém and improved shipments from
North America segment. Excluding the shipments from
ArcelorMittal Pecém, steel shipments in the second half of 2023
declined by 2.9% as compared to the second half of 2022
(mainly impacted by the lower demand in Europe).
Average steel selling prices decreased by
7.6%
for the year
ended December 31, 2024 as compared to the year ended
December 31, 2023 in line with international steel selling prices.
Average steel selling prices decreased by
7.5%
for both first half
of 2024 and second half of 2024, compared to first half and
second half of 2023,
in line
with international prices.
Average steel selling prices decreased by
13.5%
for the year
ended December 31, 2023 as compared to the year ended
December 31, 2022 in line with international steel selling prices.
Average steel selling prices decreased by 14.7% in the first half
of 2023, as compared to the first half of 2022, when prices
benefited from restocking demand following the outbreak of war
in Ukraine. Average steel selling prices decreased by 11.8% in
the
second half of 2023,
as compared to the second half of
2022,
in line with international prices.
ArcelorMittal's total iron ore production increased by
1.1%
to
42.4
million tonnes (including
27.9
million tonnes in the Mining
segment)
for the year ended December 31
, 2024 as compared
to
42.0
million tonnes (including
26.0
million tonnes in the
Mining segment)
for the year ended December 31, 2023.
ArcelorMittal's total iron ore production decreased by
7.9%
to
42.0
million tonnes (including
26.0
million tonnes in the Mining
segment)
for the year ended December 31
, 2023 as compared
102
|
Management report
|
to
45.3
million tonnes (including
28.6
million tonnes in the
Mining segment)
for the year ended December 31, 2022.
Sales
ArcelorMittal had sales of $
62.4
billion for the year ended
December 31, 2024, representing an
8.5%
decrease from sales
of $68.3 billion for the year ended December 31, 2023,
primarily
due to 7.6% lower average steel selling prices and a 2.4%
decline in steel shipments.
In the first half of 2024, sales
decreased by
12.3%
to $
32.5
billion from $
37.1
billion for the
first half of 2023,
primarily due to 4.6% lower steel shipments
and
7.5%
lower average steel selling prices.
In the second half
of 2024, sales decreased by
4.0%
to $
29.9
billion from $
31.2
billion for the second half of 2023,
primarily due to
7.5%
lower
average steel selling prices.
ArcelorMittal had sales of $68.3 billion for the year ended
December 31, 2023, representing a 14.5% decrease from sales
of $79.8 billion for the year ended December 31, 2022, primarily
due to 13.5% lower average steel selling prices. In the first half
of 2023, sales were $37.1 billion, decreasing from $44.0 billion
in the first half of 2022,
primarily due to lower steel shipments
and 15% lower average steel selling prices.
In the second half of
2023, sales of $31.2 billion represented a 13.1% decrease as
compared to sales of $35.9 billion in the second half of 2022,
primarily driven by an 11.8% decrease in average steel selling
prices, a negative currency translation impact offset in part by
2.9% higher steel shipments.
Export sales
Because Group's customers and operations are mainly based
outside its home country of Luxembourg, all of its sales are
considered to be export sales.
Annual sales to a single
individual customer did not exceed 5% of sales in any of the
periods presented.
Cost of sales
Cost of sales consists primarily of purchases of raw materials
necessary for steel-making (iron ore, coke and coking coal,
scrap and alloys), energy, repair and maintenance costs, as well
as direct labor costs, depreciation and impairment. Cost of sales
for the year ended December 31, 2024 was $
56.7
billion as
compared to $63.5 billion for the year ended December 31,
2023, mainly driven by lower iron ore, coal and energy costs
(see below for more details). Cost of sales for the year ended
December 31, 2024 included $116 million impairment charges of
property, plant and equipment, of which $37 million related to
the announced wind down of the Longs Business in
ArcelorMittal South Africa, $
43
million relating to write off of
certain civil works following the termination of the Monlevade
expansion project in Brazil and $
36
million in connection with
the closure of the Kraków coke plant in Poland.
Cost of sales for
the year ended December 31, 2024 also included $216 million
of restructuring charges, including $74 million relating to the
Europe segment, $79 million relating to Sustainable Solutions
and $63 million related to the announced wind down of the
Longs Business in ArcelorMittal South Africa. Cost of sales for
the year ended December 31, 2023 included $1.5 billion foreign
exchange translation losses and impairment charges of $0.9
billion in connection with the sale of
ArcelorMittal's Kazakhstan
operations, t
he Company's steel and mining operations in
Kazakhstan, of which $0.7 billion impairment of property, plant
and equipment and $0.2 billion impairment of former ACIS
goodwill. Cost of sales for the year ended December 31, 2023
also included $0.1 billion impairment of property, plant and
equipment of the Long operations of ArcelorMittal South
Africa
.
Cost of sales for the year ended December 31, 2022 included a
$1.0 billion impairment charge relating to ArcelorMittal Kryviy
Rih’s property, plant and equipment due to the significant
uncertainty about the evolution of the geopolitical context in
Ukraine and the timing and ability for the Company to resume
operations to a normal level.
Cost of sales for the year ended
December 31, 2022
also included $0.5 billion of inventory
related charges to reflect the net realizable value of inventory
with declining market prices in Europe, partially offset by a $0.1
billion bargain purchase gain on the acquisition of ArcelorMittal
Texas HBI and a $0.1 billion gain following the settlement of a
claim by ArcelorMittal for a breach of a supply contract.
For the years ended December 31, 2024, 2023, and 2022, cost
of sales included the following
energy costs
:
|
in millions of USD
|
2024
|
2023
|
2022
|
|
Electricity for production
|
2,736
|
3,129
|
4,360
|
|
Natural and other gases
|
1,498
|
1,887
|
3,326
|
|
Other energy and utilities
|
1,624
|
1,799
|
1,902
|
|
Total
|
5,858
|
6,815
|
9,588
|
Energy costs
represented 10%, 11% and 14% of cost of sales
for the years ended December 31, 2024, 2023, and 2022,
respectively. ArcelorMittal has taken cost mitigating actions
including hedging a part of its future energy consumption (in
accordance with the Group's commodity price hedging policy)
as well as operational savings. In the case of natural gas, the
Company has taken several actions to minimize the
consumption of natural gas throughout its production process,
including optimization of the reuse of blast furnace gases and
coke oven battery gases, and enhancement of oxygen
enrichment combustion for reheating
furnaces
.
Depreciation for the year ended December 31, 2024 was $
2.6
billion, slightly lower as compared to $2.7 billion for the year
ended December 31, 2023.
Depreciation for the year ended December 31, 2023 was $2.7
billion, slightly higher as compared to $2.6 billion for the year
ended December 31, 2022 primarily due to the acquisition of
103
|
Management report
|
ArcelorMittal Texas HBI on June 30, 2022 and ArcelorMittal
Pecém on March 9, 2023.
Selling, general and administrative expenses
Selling, general and administrative expenses ("SG&A") were
$
2.5
billion for the year ended December 31, 2024 as compared
to $2.4 billion for the year ended December 31, 2023 and $2.3
billion for the year ended December 31, 2022. S
G&A as a
percentage of sales increased for the year ended December 31,
2024 (
4.0%
) as compared to 2023 (3.5%) and 2022 (2.8%)
.
Operating income
ArcelorMittal’s operating income for the year ended December
31, 2024 was $
3.3
billion as compared to $2.3 billion for the
year ended December 31, 2023
. Operating income
for the year
ended December 31, 2024 was impacted by negative price-cost
effects across the steel segments, impact of illegal blockade of
Mexico operations and weaker performance of Mining primarily
driven by 8.3% lower iron ore reference prices. Operating
income was also impacted by the impairment and restructuring
charges described above.
ArcelorMittal’s operating income for the year ended December
31, 2023 was $2.3 billion as compared to $10.3 billion for the
year ended December 31, 2022, primarily driven by negative
price-cost effect (predominantly on account of lower average
steel selling prices (13.5%) driving a decline in steel spreads
with the pace of the decline in steel prices being greater than
the reduction in the raw material basket and energy costs.
Operating income for the year ended December 31, 2023
included a $2.4 billion charge relating to the disposal of
ArcelorMittal Kazakhstan operations including
$0.9 billion of
impairment of property, plant and equipment and goodwill and
$1.5 billion cumulative foreign exchange translation losses
(previously recognized in equity) recycled through the
consolidated statements of
operations
.
|
North America
|
|||||
|
Performance for the year
ended December 31,
|
|||||
|
(in millions of USD unless
otherwise shown)
|
2024
|
2023
|
2022
|
||
|
Sales
|
11,896
|
12,978
|
13,774
|
||
|
Depreciation
|
(509)
|
(535)
|
(427)
|
||
|
Operating income
|
1,310
|
1,917
|
2,818
|
||
|
Crude steel production
(thousand tonnes)
|
7,538
|
8,727
|
8,271
|
||
|
Flat product shipments
|
8,022
|
8,220
|
7,121
|
||
|
Long product shipments
|
2,486
|
2,734
|
2,739
|
||
|
Others and eliminations
|
(445)
|
(390)
|
(274)
|
||
|
Total steel shipments (thousand
tonnes) *
|
10,063
|
10,564
|
9,586
|
||
|
Average steel selling price
(USD/tonne)
|
985
|
1,024
|
1,215
|
||
* North America steel shipments include slabs sourced by North America from
Group subsidiaries (primarily from Brazil) and sold to the Calvert joint venture
which are then eliminated on consolidation. These shipments, which vary
between periods due to slab sourcing mix and timing of vessels in a period,
amounted to 1,
8
67
,000 tonnes
, 1,660,000 tonnes and 1,173,000 tonnes in 2024,
2023 and 2022, respectively.
Crude steel production, steel shipments and average steel
selling price
Crude steel production for the North America segment
decreased by
13.6%
to
7.5
million tonnes for the year ended
December 31, 2024 as compared to 8.7 million tonnes for the
year ended December 31, 2023. Crude steel production in the
North America segment decreased
9.4%
to
4.0
million tonnes in
the first half of 2024 as compared to
4.4
million tonnes for the
first half of 2023 and decreased
17.9%
to
3.5
million tonnes in
the second half of 2024 as compared to 4.3 million tonnes in the
second half of 2023. This resulted mainly from the illegal
blockade of Mexico's steel plant in Lazaro Cardenas and mine
located in the Tenencia La Mira in the state of Michoacán by a
group of workers due to their dissatisfaction with the distribution
of profit sharing by the Company during the second and third
quarters of 2024.
In order to maintain safety within and outside
the plant, the Company halted the steel and mining operations,
and undertook mitigation actions to continue to serve
customers
. The estimated impact was approximately 800,000
tonnes of foregone steel production and lost operating income of
$0.2 billion (including increased costs due to the actions
mentioned above).
On July 19, 2024, the Company announced
that it approved a new settlement with unions with an agreement
to end the strike and blockade leading to a gradual restart of
crude steel production, which continued to normalize during the
fourth quarter of 2024 and is expected to fully recover in the first
quarter of 2025.
Crude steel production for the North America segment increased
5.5%
to
8.7
million tonnes for the year ended December 31,
2023 as compared to 8.3 million tonnes for the year ended
December 31, 2022. Crude steel production increased
7.3%
to
4.4 million tonnes in the first half of 2023 as compared to 4.1
million tonnes the first half of 2022, which was impacted by labor
actions in Mexico and in Long Products Canada and
maintenance in Canada. Crude steel production increased
3.8%
to 4.3 million tonnes in the second half of 2023 as compared to
4.1 million tonnes in the second half of 2022, which was
impacted by planned maintenance.
Steel shipments in the North America segment decreased by
4.7%
for the year ended December 31, 2024 to
10.1
million
tonnes as compared to the 10.6 million tonnes for the year
ended December 31, 2023 primarily driven by the illegal
blockade at the Company's Mexican operations, which impacted
both the first and second halves of 2024. Steel shipments
decreased
3.4%
to
5.3
million tonnes for the first half of 2024,
from
5.4
million tonnes for the first half of 2023. Steel shipments
decreased by
6.2%
to
4.8
million tonnes in the second half of
2024, as compared to the 5.1 million tonnes in the second half
of 2023.
104
|
Management report
|
Steel shipments in the North America segment increased by
10.2%
for the year ended December 31, 2023 to
10.6
million
tonnes as compared to the
9.6
million tonnes for the year ended
December 31, 2022. Steel shipments increased
10.9%
to
5.4
million tonnes for the first half of 2023, from
4.9
million tonnes
for the first half of 2022 primarily due to higher slab shipments
sourced from the Brazil segment for Calvert and higher steel
shipments in Mexico. Steel shipments increased by
9.4%
to
5.1
million tonnes in the second half of 2023, as compared to the
4.7
million tonnes in the second half of 2022, primarily due to
the higher slab shipments sourced from Brazil and sold to the
Calvert joint venture, and higher steel shipments in Mexico.
Average steel selling prices in North America segment
decreased
3.9%
for the year ended December 31, 2024 as
compared to the year ended December 31, 2023. In the first half
of 2024, average steel selling prices decreased marginally by
1.0%
, compared to the first half of 2023, and
7.1%
lower in the
second half of 2024, as compared to the second half of 2023, in
line with the trend in market prices.
Average steel selling prices in North America segment
decreased
15.7%
for the year ended December 31, 2023 as
compared to the year ended December 31, 2022. In the first half
of 2023, average steel selling prices were
20.2%
lower than in
the first half of 2022, in line with the trend in market prices.
Average steel selling prices in the second half of 2023 were
10.0%
lower as compared to the second half of 2022, in line
with the trend in market prices.
Sales
Sales in the North America segment were $
11.9
billion for the
year ended December 31, 2024, representing a
8.3%
decrease
as compared to the year ended December 31, 2023. Sales in
the North America segment decreased
4.9%
to $
6.5
billion for
the first half of 2024 as compared to $
6.8
billion for the first half
of 2023, mainly due to
3.4%
lower steel shipments and
1.0%
lower steel average steel selling prices. Sales in the North
America segment decreased by
12.1%
in the second half of
2024 as compared to the second half of 2023, mainly due to
6.2% lower steel shipments and
7.1%
lower average steel
selling prices. Shipments in both first and second half of the
year ended December 31, 2024
were
impacted by the illegal
blockade as discussed above.
Sales in the North America segment were $
13.0
billion for the
year ended December 31, 2023, representing a
5.8%
decrease
as compared to the year ended December 31, 2022. Sales in
the North America segment decreased
7.6%
to
$6.8
billion for
the first half of 2023 as compared to $
7.4
billion for the first half
of 2022, mainly due to
20.2%
lower average steel selling prices,
offset in part by
10.9%
higher steel shipment volumes and the
impact of consolidation of ArcelorMittal Texas HBI. Sales in the
North America segment in the second half of 2023 decreased by
3.6%
as compared to the second half of 2022, mainly due to
10.0% lower average steel selling prices, partially offset by the
9.4% increase in steel shipments.
Operating income
Operating income for the North America segment decreased by
31.7%
to $
1.3
billion for the year ended December 31, 2024,
compared to $1.9 billion for the year ended December 31, 2023,
mainly due
to
4.7%
lower steel shipments and a negative price-
cost effect, including higher
costs
related to the above
mentioned illegal blockade action in Mexico.
In the first half of
2024, o
perating income was $
923
million, as compared to
$
1,117
million in the first half of 2023.
Operating income
decreased by
51.6%
in the second half of 2024 as compared to
the second half of 2023.
Operating income decreased by
32.0%
to $
1.9
billion for the
year ended December 31, 2023, compared to $
2.8
billion for the
year ended December 31, 2022, mainly due to negative price-
cost effect driven by lower average steel selling prices offset in
part by higher steel shipments. In the first half of 2023, o
perating
income for the
North America
segment was $
1,117
million, as
compared to $
1,871
million in the first half of 2022, mainly
driven by a significant negative price-cost effect offset in part by
higher steel shipments and the contribution from
ArcelorMittal
Texas HBI
.
Operating income for the North America segment in
the second half of 2023 decreased by
15.5%
, as compared to
the second half of 2022,
mainly due to negative price-cost effect
partially offset by an increase in steel
shipments.
The second
half of 2022 includes
a $0.1 billion bargain purchase gain on the
acquisition of ArcelorMittal Texas HBI and a $0.1 billion gain
following the settlement of a claim by ArcelorMittal for a breach
of a supply contract.
|
Brazil
|
|||||
|
Performance for the year
ended December 31,
|
|||||
|
(in millions of USD unless
otherwise shown)
|
2024
|
2023
|
2022
|
||
|
Sales
|
12,401
|
13,163
|
13,732
|
||
|
Depreciation
|
(361)
|
(341)
|
(246)
|
||
|
Operating income
|
1,399
|
1,461
|
2,775
|
||
|
Crude steel production
(thousand tonnes)
|
14,540
|
13,986
|
11,877
|
||
|
Flat product shipments
|
9,409
|
8,833
|
6,423
|
||
|
Long product shipments
|
4,732
|
4,905
|
5,179
|
||
|
Others and eliminations
|
(59)
|
(57)
|
(86)
|
||
|
Total steel shipments (thousand
tonnes)
|
14,082
|
13,681
|
11,516
|
||
|
Average steel selling price
(USD/tonne)
|
816
|
939
|
1,114
|
||
Crude steel production, steel shipments and average steel
selling price
Crude steel production for the Brazil segment increased
4.0%
to
14.5
million tonnes for the year ended December 31, 2024 as
compared to 14.0 million tonnes for the year ended December
105
|
Management report
|
31, 2023 primarily due to the consolidation of ArcelorMittal
Pecém from March 9, 2023. On a scope adjusted basis
excluding the impact of ArcelorMittal Pecém, crude steel
production remained stable at
11.5
million tonnes in 2024 as
compared to 2023.
Crude steel production in the Brazil segment
increased
5.7%
to
7.2
million tonnes in the first half of 2024 as
compared to
6.8
million tonnes for the first half of 2023,
including the impact of the consolidation of ArcelorMittal Pecém
from March 9, 2023.
Crude steel production in the Brazil
segment increased
2.3%
to
7.4
million tonnes for the second
half of 2024 as compared to 7.2 million tonnes for the second
half of 2023.
Crude steel production for the Brazil segment increased
17.8%
to
14.0
million tonnes for the year ended December 31, 2023 as
compared to
11.9
million tonnes for the year ended December
31, 2022 primarily due to the consolidation of ArcelorMittal
Pecém from March 9, 2023. On a scope adjusted basis
excluding the impact of ArcelorMittal Pecém, crude steel
production was 3.6% lower in 2023 compared to 2022, primarily
due to lower demand.
Crude steel production in the Brazil
segment increased
10.8%
to
6.8
million tonnes in the first half of
2023 as compared to
6.1
million tonnes for the first half of 2022,
primarily due to the consolidation of ArcelorMittal Pecém from
March 9, 2023. On a scope adjusted basis excluding the impact
of ArcelorMittal Pecém, crude steel production
for the first half of
2023
was
5.3%
lower as compared to the first half of
2022, due
to lower demand including exports (in particular in the first
quarter of 2023). Crude steel production in the Brazil segment
increased
25.2%
to
7.2
million tonnes for the second half of
2023 as compared to
5.8
million tonnes for the second half of
2022, primarily due to
the consolidation of ArcelorMittal Pecém
(as discussed above)
.
On a scope adjusted basis excluding the
impact of ArcelorMittal Pecém, crude steel production
for the
second half of 2023
was
1.7%
lower as compared to the second
half of
2022, primarily due to lower demand in Argentina.
Steel shipments increased
2.9%
to
14.1
million tonnes for the
year ended December 31, 2024 as compared to 13.7 million
tonnes for the year ended December 31, 2023. On a scope
adjusted basis excluding the impact of ArcelorMittal Pecém,
steel shipments remained stable at
11.2
million tonnes in 2024
as compared to 2023. Steel shipments
increased
4.6%
to
6.8
million tonnes
in the first half of 2024 as compared to
6.5
million
tonnes
for the first half of 2023, primarily due to the impact of
ArcelorMittal Pecém.
S
teel shipments in the second half of 2024
increased
1.5%
as compared to the second half of 2023.
Steel shipments increased
18.8%
to
13.7
million tonnes for the
year ended December 31, 2023 as compared to 11.5 million
tonnes for the year ended December 31, 2022. On a scope
adjusted basis excluding the impact of ArcelorMittal Pecém,
steel shipments decreased
2.8%
in 2023 as compared to 2022.
Steel shipments increased
8.0%
to
6.5
million tonnes in the first
half of 2023 as compared to
6.0
million tonnes for the first half of
2022, primarily due to the impact of ArcelorMittal Pecém. On a
scope adjusted basis excluding the impact of ArcelorMittal
Pecém, steel shipments for the first half of 2023 were
7.9%
lower as compared to the first half of 2022 due to lower demand
including exports. Steel shipments in the second half of 2023
increased
30.8%
as compared to the second half of 2022,
primarily due to due to the impact of ArcelorMittal Pecém. On a
scope adjusted basis excluding the impact of ArcelorMittal
Pecém, steel shipments for the second half of 2023 were
2.9%
higher as compared to the second half of 2022.
Average steel selling prices decreased
13.1%
for the year
ended December 31, 2024 as compared to the year ended
December 31, 2023,
in line with the trend in market prices.
Average steel selling prices decreased
13.8%
in the first half of
2024 compared to the first half of 2023 and
12.6%
in second
half of 2024 as compared to the second half of 2023, in line with
the trend in market prices.
Average steel selling prices decreased
15.7%
for the year
ended December 31, 2023 as compared to the year ended
December 31, 2022,
in line with the trend in market prices.
Average steel selling prices decreased
12.8%
in the first half of
2023 compared to the first half of 2022
in line with the trend in
market prices.
Average steel selling prices decreased
18.1%
in
second half of 2023 as compared to the second half of 2022, in
line with the trend in market prices.
Sales
In the Brazil segment, sales decreased
5.8%
to $
12.4
billion for
the year ended December 31, 2024 as compared to $13.2 billion
for the year ended December 31, 2023, primarily due to
13.1%
lower average steel selling prices offset in part by
2.9%
higher
steel shipments. In the first half of 2024, sales decreased
8.7%
to $
6.3
billion as compared to $
6.9
billion for the first half of
2023 primarily due to
13.8%
lower average steel selling prices
offset in part by
4.6%
higher steel shipments. Sales in the Brazil
segment in the first half of 2024 was also impacted by the
devaluation of the Argentinian peso. In the second half of 2024,
sales decreased
2.6%
to $
6.1
billion as compared to $
6.3
billion
for the second half of 2023,
driven by lower average steel selling
prices offset in part by the
1.5%
increase in shipments.
Sales decreased
4.1%
to $
13.2
billion for the year ended
December 31, 2023 as compared to $13.7 billion for the year
ended December 31, 2022, primarily due to
15.7%
lower
average steel selling prices offset in part by
18.8%
higher steel
shipments, mainly due to the impact of ArcelorMittal Pecém. In
the first half of 2023, sales decreased
6.2%
to $
6.9
billion as
compared to $
7.4
billion for the first half of 2022 primarily due to
12.8%
lower average steel selling prices offset in part by
8.0%
higher steel shipments (including ArcelorMittal Pecém). In the
second half of 2023, sales decreased
1.8%
to $
6.3
billion as
compared to $
6.4
billion for the second half of 2022, driven by
106
|
Management report
|
an
18.1%
decrease in average steel selling prices and the
devaluation of the Argentinian peso, offset by a
30.8%
increase
in shipments.
Operating income
Operating income for the Brazil segment was $
1.4
billion for the
year ended December 31, 2024, representing a
4.2%
decrease
as compared to $1.5 billion for the year ended December 31,
2023, Operating income included a $43 million impairment
charge relating to write off of civil works following the termination
of the Monlevade expansion project in Brazil. Operating income
was $
627
million in the first half of 2024 as compared to $
876
million in the first half of 2023. Operating income decreased
28.4%
in the first half of 2024 compared to the first half of 2023
mainly due to a negative price-cost effect (i.e., the decline in
selling prices exceeded the decline in costs) offset in part by
higher shipment volumes.
Operating income increased
32.0%
to
$
772
million in the second half of 2024 from $
585
million in the
second half of 2023 driven by higher shipment volume and a
positive price-cost effect with the decline in selling prices more
than offset by the decline in costs.
Operating income for the Brazil segment was $
1.5
billion for the
year ended December 31, 2023, representing a
47.3%
decrease
as compared to the year ended December 31, 2022, primarily
due to a negative price-cost effect and the impact of the
devaluation of the Argentinian peso offset in part by the
contribution from ArcelorMittal Pecém. Operating income for the
year ended December 31, 2022 also included $0.2 billion
related to PIS/COFINS tax credits with respect to scrap
purchases for prior periods. Operating income in the first half of
2023 was $
876
million as compared to $1,875 million in the first
half of 2022. Operating income decreased
53.3%
in the first half
of 2024 compared to the first half of 2023 primarily driven by
negative price-cost effect, partly offset by higher steel shipments
(including the contribution from ArcelorMittal Pecém). Operating
income decreased 35.0% to $
585
million in the second half of
2023 from $
901
million in the second half of 2022, mainly due to
a negative price-cost effect, and the impact of the devaluation of
the Argentinian peso, partially offset by the contribution from
ArcelorMittal Pecém.
|
Europe
|
|||||
|
Performance for the year
ended December 31,
|
|||||
|
(in millions of USD unless
otherwise shown)
|
2024
|
2023
|
2022
|
||
|
Sales
|
29,952
|
31,695
|
39,639
|
||
|
Depreciation
|
(1,128)
|
(1,098)
|
(1,160)
|
||
|
Operating income
|
386
|
879
|
3,521
|
||
|
Crude steel production
(thousand tonnes)
|
31,211
|
28,445
|
31,483
|
||
|
Flat product shipments
|
20,489
|
19,570
|
21,387
|
||
|
Long product shipments
|
8,183
|
8,001
|
8,321
|
||
|
Others and eliminations
|
(13)
|
(12)
|
(9)
|
||
|
Total steel shipments (thousand
tonnes)
|
28,659
|
27,559
|
29,699
|
||
|
Average steel selling price
(USD/tonne)
|
910
|
995
|
1,157
|
||
Crude steel production, steel shipments and average steel
selling price
Crude steel production for the Europe segment increased
9.7%
to
31.2
million tonnes for the year ended December 31, 2024 as
compared to 28.4 million tonnes for the year ended December
31, 2023, which was negatively impacted by lower demand and
outages of blast furnaces (see below). Crude steel production
increased
7.8%
to
15.6
million tonnes
in the first half of 2024
from
14.5
million tonnes
in the first half of 2023. 2023
was
negatively impacted by outages of blast furnaces ("BF") in Gijón,
Spain (BF A) and Dunkirk, France (BF 4) in late March 2023
prior to restart in mid-July 2023.
Crude steel production
increased
11.7%
to
15.6
million tonnes in the second half of
2024 from
13.9
million tonnes in the second half of 2023, which
was negatively impacted, in particular in the fourth quarter, by a
reline of blast furnace A at Ghent (Belgium), planned
maintenance of blast furnace #2 at Bremen (Germany), both of
which restarted in early December 2023, and production cuts at
blast furnace #1 in Fos-sur-Mer (France).
Crude steel production for the Europe segment decreased
9.6%
to
28.4
million tonnes for the year ended December 31, 2023 as
compared to
31.5
million tonnes for the year ended December
31, 2022, mainly due to lower demand and outages of blast
furnaces. In the first quarter of 2023, the Company gradually
restarted previously curtailed crude steel capacity to meet
demand as apparent demand conditions improved following the
aggressive destock in the second half of 2022 but in late March
2023, the Company was impacted by incidents that temporarily
disabled blast furnaces at Gijón, Spain (blast furnace A) and at
Dunkirk, France (blast furnace #4). These blast furnaces were
restarted in mid-July 2023 but crude steel production was still
negatively impacted by slow ramp up in third quarter of 2023.
Crude steel production in the fourth quarter of 2023 was
negatively impacted by a reline of blast furnace A at Ghent
(Belgium) and planned maintenance of blast furnace #2 at
Bremen (Germany), both of which restarted in early December
107
|
Management report
|
2023, and production cuts at blast furnace #1 in Fos-sur-Mer
(France). Crude steel production decreased
13.2%
to
14.5
million tonnes in the first half of 2023 from
16.7
million tonnes in
the first half of 2022 and
5.7%
to
13.9
million tonnes in the
second half of 2023 from
14.8
million tonnes in the second half
of 2022 for the above-mentioned reasons.
Steel shipments were
28.7
million tonnes for the year ended
December 31, 2024, representing a
4.0%
increase from steel
shipments of 27.6 million tonnes for the year ended December
31, 2023, primarily due to higher production as discussed
above. Steel shipments slightly decreased to
14.6
million tonnes
in the first half of 2024,
as compared to
14.7
million tonnes
in
the first half of 2023. Steel shipments increased
9.2%
in the
second half of 2024 compared to the second half of 2023, which
had been negatively impacted by curtailed production in light of
continued weak apparent demand driven by destocking and
construction-related demand.
Steel shipments were
27.6
million tonnes for the year ended
December 31, 2023, representing a
7.2%
decrease from steel
shipments of
29.7
million tonnes for the year ended December
31, 2022, primarily due to lower production as discussed above
and weaker demand (including weaker construction-related
demand). Steel shipments decreased
8.4%
to
14.7
million
tonnes in the first half of 2023, from
16.1
million tonnes in the
first half of 2022 mainly due to lower production as discussed
above and weaker demand. Steel shipments decreased
5.8%
in
the second half of 2023 compared to the second half of 2022,
primarily due to curtailed production in light of continued weak
apparent demand driven by destocking and construction-related
demand.
Average steel selling prices decreased
8.5%
for the year ended
December 31, 2024 as compared to the year ended December
31, 2023. Average steel selling prices decreased
8.7%
in the
first half of 2024 as compared to the first half of 2023 and by
11.4%
during the second half of 2024 as compared to the
second half of 2023, in line with the trend in market prices.
Average steel selling prices decreased
14.0%
for the year
ended December 31, 2023 as compared to the year ended
December 31, 2022. Average steel selling prices decreased
15.9%
in the first half of 2023 as compared to the first half of
2022 in line with the trend in market prices. Average steel selling
prices decreased by
11.2%
during the second half of 2023 as
compared to the second half of 2022, in line with the trend in
market prices.
Sales
Sales in the Europe segment were $
30.0
billion for the year
ended December 31, 2024, representing a
5.5%
decrease as
compared to sales of $31.7 billion for the year ended December
31, 2023, primarily due to a
8.5%
decrease in average steel
selling prices offset
in
part by
4.0%
higher steel shipments. In
the first half of 2024, sales decreased
11.8%
to $
15.7
billion
as
compared to
$
17.8
billion
in the first half of 2023,
primarily due
to a
8.7%
decrease in average steel selling prices.
In the
second half of 2024, sales increased by
2.5%
to $
14.3
billion as
compared to $13.9 billion in the second half of 2023,
primarily
due to
9.2%
higher steel shipments
offset in part by t
he 11.4%
decline in average steel selling prices
.
Sales in the Europe segment were $31.7 billion for the year
ended December 31, 2023, representing a
20.0%
decrease as
compared to sales of $
39.6
billion for the year ended December
31, 2022, primarily due to a
14.0%
decrease in average steel
selling prices and
7.2%
lower steel shipments. In the first half of
2023, sales decreased by
20.6%
to $
17.8
billion as compared to
$
22.4
billion in the first half of 2022,
primarily due to a
15.9%
decrease in average steel selling prices and
8.4%
lower steel
shipments
. In the second half of 2023, sales decreased by
19.4%
to $
13.9
billion as compared to $
17.3
billion in the
second half of 2022,
primarily due to a
11.2%
decrease in
average steel selling prices and
5.8%
lower steel shipments
.
Operating income
Operating income for the Europe segment for the year ended
December 31, 2024 was $
386
million as compared to operating
income of $879 million for the year ended December 31, 2023.
Operating income was negatively impacted by $
36
million
impairment charges of property, plant and equipment and $74
million restructuring charges in connection with the closure of
the Kraków coke plant in Poland. Operating income was lower in
2024 primarily due to a negative price-cost effect driven by a
decline in selling prices offset in part by lower costs, and higher
shipment volumes.
Operating
income in the first half of 2024,
was
$
263
million, as compared to $
744
million for the first half of
2023,
primarily
due to a negative price-cost effect (as the
decline in selling prices exceeded the decline in costs)
.
O
perating income was lower at $
123
million for the second half
of 2024 as compared to $135 million for the second half of 2023
impacted by the impairment and restructuring charges described
above.
Operating income for the Europe segment for the year ended
December 31, 2023 was $
879
million as compared to operating
income of $
3,521
million for the year ended December 31, 2022.
Operating income was lower in 2023 primarily due to a negative
price-cost effect and lower shipments offset in part by lower
energy costs. Operating income was $
744
million for the first
half of 2023 as compared to $
3,448
million for the first half of
2022,
primarily due to a negative price-cost effect and lower
108
|
Management report
|
shipments offset in part by lower energy costs. O
perating
income was higher at $
135
million for the second half of 2023 as
compared to $
73
million for the second half of 2022, which had
been impacted by $0.5 billion inventory-related
charges
.
|
India and JVs
|
|||
|
Performance for the year
ended December 31,
|
|||
|
(in millions of USD unless otherwise shown)
|
2024
|
2023
|
2022
|
|
Income from investments in associates, joint
ventures and other investments
|
779
|
1,184
|
1,317
|
|
Impairment of investments in associates,
joint ventures and other investments
|
—
|
(1,405)
|
—
|
I
ncome from investments in associates, joint ventures and other
investments
was lower at $
779
million for the year ended
December 31, 2024, as compared to $1,184 million for the year
ended December 31, 2023. Income from investments in
associates, joint ventures and other investments was impacted
by the lower contributions from AMNS India and Chinese
investees in 2024 partly
offset by the positive contribution of
Vallourec in the fourth quarter of 2024
.
Income from investments in associates, joint ventures and other
investments was lower at $
423
million for the first half of 2024,
as compared to $711 million for the first half of 2023, mainly
driven by lower contributions from AMNS India. Income from
investments in associates, joint ventures and other investments
was lower at $
356
million for the second half of 2024, as
compared to $473 million for the second half of 2023, primarily
d
ue to lower contributions from AMNS India offset in part by
higher contribution from AMNS Calvert and Vallourec.
Income from investments in associates, joint ventures and other
investments amounted to $
1,184
million for the year ended
December 31, 2023, as compared to $
1,317
million for the year
ended December 31, 2022. Income from investments in
associates, joint ventures and other investments benefited from
higher contributions from AMNS India and Chinese investees in
2023. Income from investments in associates, joint ventures and
other investments included the annual dividend from Erdemir of
$117 million in 2022, with no such dividend received in 2023.
Income from investments in associates, joint ventures and other
investments was lower at $
711
million for the first half of 2023,
as compared to $
1,137
million for the first half of 2022, primarily
due to lower contributions from AMNS Calvert and European
investees, which experienced similar dynamics to those
affecting the Company, partially offset by the higher contribution
from AMNS India. Income from investments in associates, joint
ventures and other investments was higher at $
473
million for
the second half of 2023, as compared to $
180
million for the
second half of 2022, primarily due to higher contributions from
AMNS India and Chinese investees, partially offset by the lower
contribution from European investees.
Impairment of investments in associates, joint ventures and
other investments amounted to nil, $1,405 million and nil for the
years ended December 31, 2024, 2023 and 2022. The
impairment charge recognized in 2023 related to ADI due to a
downward revision of expected future cash flows and the then-
uncertainty regarding its future.
|
Sustainable Solutions
|
|||||
|
Performance for the year
ended December 31,
|
|||||
|
(in millions of USD unless
otherwise shown)
|
2024
|
2023
|
2022
|
||
|
Sales
|
10,722
|
11,467
|
13,658
|
||
|
Depreciation
|
(178)
|
(143)
|
(108)
|
||
|
Operating income
|
57
|
225
|
778
|
||
Sales
Sales in the Sustainable Solutions segment were $
10.7
billion
for the year ended December 31, 2024, representing a
6.5%
decrease as compared to $11.5 billion the year ended
December 31, 2023, primarily
due to weaker market conditions
including lower activity levels and prices.
In the first half of 2024,
sales decreased
8.7%
to $
5.8
billion
as compared to $
6.3
billio
n
in the first half of 2023, and in the second half of 2024 sales
decreased by
3.8%
to $
4.9
billion as compared to $5.1 billion in
the second half of 2023.
Sales in the Sustainable Solutions segment were $
11.5
billion
for the year ended December 31, 2023, representing a
16.0%
decrease as compared to $
13.7
billion the year ended
December 31, 2022, primarily due to lower volumes and pricing
in the steel downstream and construction business. In the first
half of 2023, sales decreased
17.7%
to
$
6.3
billion
as compared
to $
7.7
billion in the first half of 2022, and in the second half of
2023 sales decreased by
13.9%
to $
5.1
billion as compared to
$
6.0
billion in the second half of 2022 primarily due to the same
reason as for the full year.
Operating Income for the Sustainable Solutions segment was
$
57
million for the year ended December 31, 2024 as compared
to $
225
million for the year ended December 31, 2023, primarily
due to lower activity and margins in the steel downstream and
construction business and a lower margin order mix in the
projects business.
Operating income for the year ended
December 31, 2024 was also negatively impacted by
$79 million
primarily related to restructuring of the distribution network,
resulting in a concentration of sites to improve efficiencies.
Operating income for the first half of 2024 was $
81
million, as
compared to operating income of $
189
million in the first half of
2023, primarily due to lower margins impacted by weaker
market conditions. In the second half of 2024, operating loss of
the Sustainable Solutions segment amounted to $
24
million as
compared to operating income of $
36
million for the second half
109
|
Management report
|
of 2023 impacted by the restructuring c
harges, lower
activity,
margins, and mix as mentioned above.
Operating i
ncome
for the Sustainable Solutions segment was
$
0.2
billion for the year ended December 31, 2023 as compared
to $
0.8
billion for the year ended December 31, 2022, primarily
due to lower margins in the steel downstream and construction
business. Operating income for the first half of 2023 decreased
to $
0.2
billion as compared to $
0.7
billion for the first half of
2022, primarily due to lower margins in the steel downstream
and construction business that benefited from exceptional
pricing environment in the first half of 2022. In the second half of
2023, operating income of the Sustainable Solutions segment
amounted to $
36
million as compared to $
78
million for the
second half of 2022 primarily due to a lower margin order mix in
the projects business.
|
Mining
|
||||||
|
Performance for the year
ended December 31,
|
||||||
|
(in millions of USD unless
otherwise shown)
|
2024
|
2023
|
2022
|
|||
|
Sales
|
2,663
|
3,077
|
3,396
|
|||
|
Depreciation
|
(263)
|
(238)
|
(234)
|
|||
|
Operating income
|
770
|
1,144
|
1,483
|
|||
|
Iron ore production (million
tonnes)
|
27.9
|
26.0
|
28.6
|
|||
|
Iron ore shipments (million
tonnes)
|
26.4
|
26.4
|
28.0
|
|||
|
Note
|
For the year ended
December 31,
|
|||||
|
Iron ore
production
(million metric
tonnes)
|
1
|
Type
|
Product
|
2024
|
2023
|
2022
|
|
AMMC
|
Open pit
|
Concentrate,
lump, fines
and pellets
|
24.2
|
22.4
|
24.2
|
|
|
AML
|
Open pit /
Underground
|
Fines
|
3.7
|
3.6
|
4.4
|
|
|
Total iron ore
production
|
27.9
|
26.0
|
28.6
|
|||
1.
Total of all finished production of fines, concentrate, pellets and lumps.
Production
The Mining segment had iron ore production of
27.9
million
tonnes for the year ended December 31, 2024, a
7.7%
increase
compared to the year ended December 31, 2023. Iron ore
production for the Mining segment decreased
5.3%
to
12.4
million tonnes for the first half of 2024 compared to
13.1
million
tonnes in the first half of 2023. Iron ore production was impacted
by rail disruption at AMMC following wildfires in the Port Cartier
region during the last few weeks of June 2024 and unplanned
maintenance. Production at ArcelorMittal Liberia was impacted
by rail accidents in the fourth quarter of 2023 and in the first
quarter of 2024. Iron ore production increased
20.8%
in the
second half of 2024 compared to the second half of 2023
primarily due to improved performance at AMMC, and Liberia
where rail operations had been severely impacted in the second
half of 2023 due to damages to a rail bridge.
The Mining segment had iron ore production of
26.0
million
tonnes for the year ended December 31, 2023, a
9.1%
decrease
compared to the year ended December 31, 2022. Iron ore
production of
13.1
million tonnes decreased
7.9%
for the first
half of 2023 compared to
14.2
million tonnes in the first half of
2022 reflecting primarily lower iron ore production in AMMC due
to unplanned maintenance. Iron ore production decreased
10.6%
in the second half of 2023 compared to the second half
of 2022 primarily due to lower production in Liberia where the
rail operations were severely impacted by damages to a rail
bridge in early November 2023.
Sales
Sales in the Mining segment were $
2.7
billion for the year ended
December 31, 2024, representing a
13.5%
decrease as
compared to $3.1 billion for the year ended December 31, 2023,
driven by 8.3% lower iron ore reference prices. Sales in the first
half of 2024
decreased
13.5%
to $
1.4
billion
compared to
$
1.6
billion
for the same period in 2023
primarily due to
10.9%
lower
iron ore shipments and slightly lower iron ore prices.
Sales in
the second half of 2024
decreased
13.4%
to $
1.3
billion
as
compared to
$
1.5
billion
for the same period in 2023
primarily
due to lower
16.1%
iron ore
reference prices offset in part
12.6%
higher shipments.
Sales in the Mining segment were $
3.1
billion for the year ended
December 31, 2023, representing a
9.4%
decrease as
compared to $3.4 billion for the year ended December 31, 2022
as a result of 5.8% decrease in shipments following above-
mentioned lower production. Sales in the first half of 2023
decreased
18.3%
to $
1.6
billion
compared to $
1.9
billion for the
same period in 2022
primarily due to
15.6%
lower iron ore
reference prices and
1.9%
lower iron ore shipments.
Sales in
the second half of 2023 and 2022 remain stable at $
1.5
billion
as the increase in
iron ore reference prices was largely offset by
lower shipments
.
Sales to external customers were $
982
million
for the year
ended December 31, 2024, representing a decrease of
16%
as
compared to the year ended December 31, 2023
due to lower
shipments and lower prices.
Sales to external customers were $1.2 billion for the year ended
December 31, 2023, representing a decrease of 10.3% as
compared to the year ended December 31, 2022
due to lower
selling prices.
Iron ore shipments to external customers were 9.3 million
tonnes for the year ended December 31, 2024, representing a
7.1% decrease as compared to 10.0 million tonnes for the year
ended December 31, 2023.
110
|
Management report
|
Iron ore shipments to external customers were 10.0 million
tonnes for the year ended December 31, 2023, representing an
8.4% decrease as compared to 10.9 million tonnes for the year
ended December 31, 2022,
primarily due to lower production in
AMMC and Liberia.
The average reference iron ore price was $
109.6
per tonne in
2024, $119.5 per tonne in 2023 and $120.3 per tonne in 2022
(delivered to China, normalized to Qingdao and 62% Fe US $
per tonne, Metal Bulletin). However, there may not be a direct
correlation between reference prices and actual selling prices in
various regions at a given time. See also quarterly reference
prices in "Raw materials" above.
Operating income
Operating income for the Mining segment was
32.7%
lower at
$
770
million for the year ended December 31, 2024 as
compared to $1,144 million for the year ended December 31,
2023, primarily driven by 8.3% lower iron ore reference prices
and higher freight costs. Operating income decreased to
$
396
million
in the first half of 2024 compared to
$
599
million
in the
first half of 2023,
primarily due to lower iron ore prices and lower
shipments.
Operating income decreased by
31.4%
to $
374
million in the second half of 2024 as compared to $545 million in
the second half of 2023 primarily due to lower iron ore prices in
the second half of 2024 compared to the second half of 2023,
offset in part by higher
shipments
.
Operating income for the Mining segment was
22.9%
lower at
$
1,144
million for the year ended December 31, 2023 as
compared to $1,483 million for the year ended December 31,
2022, primarily driven by lower quality premia, lower shipments
and higher costs partly offset by lower freight. Operating income
decreased to $
599
million in the first half of 2023 compared to
$
974
million
in the first half of 2022,
primarily due to lower
seaborne iron ore reference prices, lower shipments as
discussed above and lower quality premia partially offset by
lower freight costs.
Operating income increased by
7.1%
to
$
545
million in the second half of 2023 as compared to $
509
million in the second half of 2022 primarily due to 19.9
%
higher
seaborne iron ore prices in the second half of 2023 compared to
the second half of 2022, offset in part by lower shipments and
lower quality premia.
Income from and impairments of investments in associates, joint
ventures and other investments
ArcelorMittal has investments in various joint ventures and
associates. The Company considers AMNS Calvert and AMNS
India joint ventures to be of particular strategic importance,
warranting more detailed disclosures to improve the
understanding of their operational performance and value to the
Company.
|
AMNS India
|
|||
|
Performance for the year
ended December 31,
|
|||
|
(in millions of USD unless otherwise
shown)
|
2024
|
2023
|
2022
|
|
Crude steel production (100% basis)
(thousand tonnes)
|
7,544
|
7,463
|
6,685
|
|
Steel shipments (100% basis)
(thousand tonnes)
|
7,933
|
7,251
|
6,470
|
|
Sales (100% basis)
|
6,515
|
6,710
|
7,287
|
AMNS India
AMNS India production increased marginally by
1.1%
in 2024 to
7.5
million tonnes and shipments increased by
9.4%
from 7.3
million tonnes in 2023 to
7.9
million tonnes in 2024. Crude steel
production of AMNS India increased by
8.3%
from
3.6
million
tonnes in the first half of 2023 to
3.9
million tonnes in the first
half of 2024. Steel shipments of AMNS India increased by
11.4%
from
3.5
million tonnes in the first half of 2023 to
3.9
million tonnes in the first half of 2024. Crude steel production of
AMNS India decreased by
5.5%
from 3.9 million tonnes in the
second half of 2023 to
3.7
million tonnes in the second half of
2024. Steel shipments of AMNS India increased by
7.6%
from
3.7 million tonnes in the second half of 2023 to
4.0
million
tonnes in the second half of 2024. Sales decreased 2.9% from
$6.7 billion in 2023 to $6.5 billion in 2024. Sales increased
2.3%
from $3.3 billion in the first half of 2023 to $3.4 billion in the first
half of 2024. Sales decreased 8.0% from $3.4 billion in the
second half of
2023
to $3.1 billion in the second half of 2024.
AMNS India experienced a negative price-cost effect in 2024
compared to 2023 including a lower benefit from natural gas
hedges
.
AMNS India production increased by
11.5%
from
6.7
million
tonnes in 2022 to
7.5
million tonnes in 2023, and shipments
increased by
12.1%
from
6.5
million tonnes in 2022 to
7.3
million tonnes in 2023. Crude steel production and steel
shipments of AMNS India increased by
4.7%
and
8.2%
,
respectively, from 3.4 million tonnes in the first half of 2022 to
3.6 million tonnes in the first half of 2023 and from 3.2 million
tonnes in the first half of 2022 to 3.5 million tonnes in the first
half of 2023, respectively. Crude steel production and steel
shipments of AMNS India increased by
18.8%
and
15.7%
,
respectively, from
3.3
million tonnes in the second half of 2022
to
3.9
million tonnes in the second half of 2023 and from
3.2
million tonnes in the second half of 2022 to
3.7
million tonnes in
the second half of 2023, respectively. Sales decreased by 7.9%
from $7.3 billion in 2022 to $6.7 billion in 2023. Sales decreased
by 17.9% from $4.0 billion in the first half of 2022 to $3.3 billion
in the first half of 2023.
Sales increased
4.4%
from $
3.2
billion in
the second half of 2022 to $
3.4
billion in the second half of
2023
. AMNS India’s results in the second half of 2023 also
reflected the unwinding of a natural gas
hedges
.
111
|
Management report
|
|
AMNS Calvert
|
|||
|
Performance for the year
ended December 31,
|
|||
|
(in millions of USD unless otherwise
shown)
|
2024
|
2023
|
2022
|
|
HSM production (100% basis) (thousand
tonnes)
|
4,496
|
4,654
|
4,320
|
|
Steel shipments (100% basis) (thousand
tonnes)
|
4,232
|
4,469
|
4,229
|
|
Sales (100% basis)
|
4,544
|
4,860
|
4,969
|
AMNS Calvert
Hot strip mill production
1
for AMNS Calvert decreased by
3.4%
from 4.7 million tonnes in 2023 to
4.5
million tonnes in 2024 and
shipments
2
decreased by
5.3%
from 4.5 million tonnes in 2023
to
4.2
million tonnes in 2024. AMNS Calvert's production
1
remained stable at 2.4 million tonnes in the first half of 2024 and
2023 while steel shipments
2
decreased by
2.2%
from
2.33
million tonnes in the first half of 2023 to
2.28
million tonnes in
the first half of 2024. AMNS Calvert's production
1
decreased by
6.8%
from
2.2
million tonnes in the second half of 2023 to
2.1
million tonnes in the second half of 2024 while steel shipments
2
decreased by
8.7%
from 2.1 million tonnes in the second half of
2023 to
2.0
million tonnes in the second half of 2024. Sales
decreased 6.5
%
in 2024 to $4.5 billion from $4.9 billion in 2023.
Sales were
2.8%
lower at $2.48 billion in the first half of 2024 as
compared to $2.55 billion in the first half of 2023. Sales were
10.6%
lower at $
2.06
billion in the second half of 2024 as
compared to $
2.31
billion in the second half of 2023.
AMNS
Calvert benefited from a positive price-cost effect driven
primarily by lower purchased slab cost.
Hot strip mill production
1
for AMNS Calvert increased by
7.7%
from
4.3
million tonnes in 2022 to
4.7
million tonnes in 2023 and
shipments
2
increased by
5.7%
from
4.2
million tonnes in 2022 to
4.5
million tonnes in 2023. AMNS Calvert's production
1
increased by
7.7%
from 2.3 million tonnes in the first half of
2022 to 2.4 million tonnes in the first half of 2023 while steel
shipments
2
remained stable at 2.3 million tonnes in the first half
of 2022 and 2023. AMNS Calvert's production
1
increased by
7.8%
from
2.1
million tonnes in the second half of 2022 to
2.2
million tonnes in the second half of 2023 while steel shipments
2
increased by
10.7%
from
1.9
million tonnes in the second half of
2022 to
2.1
million tonnes in the second half of 2023. Increased
production and shipments were due to improved demand
conditions.
Sales decreased by 2.2% in 2023 to $4.9 billion from
$5.0 billion in 2022.
Sales decreased by 8.3% from $2.8 billion
in the first half of 2022 to $2.6 billion in the first half of 2023 and
increased by 5.5% from $2.2 billion in the second half of 2022 to
$2.3 billion in the second half of 2023. AMNS Calvert’s results
were negatively impacted in the second half of 2023 by negative
price cost effect, weaker product mix and higher maintenance
costs.
1.
Production: all production of the hot strip mill including processing of slabs on a hire work
basis for ArcelorMittal group entities and third parties, including stainless steel slabs.
2.
Shipments: all shipments including shipments of finished products processed on a hire work
basis for ArcelorMittal group entities and third parties, including stainless steel products.
Impairments of investments in joint ventures, associates and
other investments were $1.4 billion in the year ended December
31, 2023 with respect to Acciaierie d'Italia
due to a downward
revision of expected future cash flows together with the
uncertainty regarding its future
, see also note 2.3 to
consolidated financial statements. No such impairments were
recorded in 2024 or 2022.
Financing
costs-net
Financing costs-net include net interest expense, revaluation of
financial instruments, net foreign exchange income/expense
(i.e., the net effects of transactions in a foreign currency other
than the functional currency of a subsidiary) and other net
financing costs (which mainly include bank fees, accretion of
defined benefit obligations and other long-term liabilities).
Net financing costs were
higher
at $
1.2
billion for the year ended
December 31, 2024 as compared to $0.9 billion for the year
ended December 31,
2023
.
Net interest expense (interest
expense less interest income) was slightly lower at $
110
million
for the year ended December 31, 2024 as compared to $145
million for the year ended December 31, 2023 and included
$0.3
billion of capitalized borrowing
costs
. Net financing costs for the
year ended December 31, 2024 included $
83
million expense
relating to the fair value at acquisition date of the forward in
connection with the Vallourec acquisition.
Foreign exchange losses were $
565
million as compared to
$48 million for the years ended December 31, 2024 and 2023,
respectively. In 2024, foreign exchange losses were higher
mainly due to the appreciation of the U.S. dollar against most
currencies.
Other net financing costs (including expenses related to true
sale of receivables ("TSR"), bank fees, interest on pensions and
derivative instruments) were
$0.5 billion
for the year ended
December 31, 2024 compared to
$0.7 billion
for the year ended
December 31, 2023.
Net financing costs were higher at $0.9 billion for the year ended
December 31, 2023 as compared to $0.3 billion for the year
ended December 31, 2022. Net interest expense (interest
expense less interest income) was lower at $145 million for the
year ended December 31, 2023 as compared to $213 million for
the year ended December 31, 2022, due to higher interest
income in Argentina from investments in currency-protected
funds.
Foreign exchange losses were $48 million as compared to
foreign exchange gains of $191 million for the years ended
December 31, 2023 and 2022, respectively.
112
|
Management report
|
Other net financing costs (including expenses related to true
sale of receivables ("TSR"), bank fees, interest on pensions and
fair value adjustments of the call option of the mandatorily
convertible bond and derivative instruments) were $0.7 billion
for the year ended December 31, 2023 compared to $0.3 billion
for the year ended December 31, 2022. 2022 included mark-to-
market losses related to the mandatory convertible bond call
option totaling $16 million
.
Income tax expense (benefit)
ArcelorMittal recorded an income tax expense of
$1.5
billion for
the year ended December 31, 2024 as compared to $0.2 billion
for the year ended December 31, 2023. T
he increase included a
$0.4 billion decrease in deferred tax asset and resulting deferred
tax expense related to the decrease of the statutory tax rate in
Luxembourg effective January 1, 2025 from 24.94% to 23.87%.
Income tax expense included a
lso in
2024 a $0.2 billion
provision relating to
expected resolution of
the tax disputes in
the North America segment.
See note 10.1 to the consolidated
financial statements
.
ArcelorMittal recorded an income tax expense of $0.2 billion for
the year ended December 31, 2023 as compared to $1.7 billion
for the year ended December 31, 2022 reflecting overall lower
taxable income.
ArcelorMittal’s consolidated income tax expense (benefit) is
affected by the income tax laws and regulations in effect in the
various countries in which it operates and the pre-tax results of
its subsidiaries in each of these countries, which can change
from year to year. ArcelorMittal operates in jurisdictions, mainly
in Eastern Europe and Asia, which have a structurally lower
corporate income tax rate than the statutory tax rate as enacted
in Luxembourg (23.87%), as well as in jurisdictions, mainly in
Brazil and Mexico, which have a structurally higher corporate
income tax rate.
The statutory income tax expense (benefit) and the statutory income tax rates of the countries that most significantly resulted in the tax
expense (benefit) at statutory rate for each of the years ended December 31,
2024
, 2023 and 2022 are as set forth below:
|
2024
|
2023
|
2022
|
|||||||||
|
Statutory
income tax
|
Statutory
income tax rate*
|
Statutory
income tax
|
Statutory
income tax rate
|
Statutory
income tax
|
Statutory
income tax rate
|
||||||
|
Argentina
|
(39)
|
35.00
%
|
80
|
35.00
%
|
100
|
35.00
%
|
|||||
|
Belgium
|
(27)
|
25.00
%
|
(12)
|
25.00
%
|
238
|
25.00
%
|
|||||
|
Brazil
|
173
|
34.00
%
|
153
|
34.00
%
|
698
|
34.00
%
|
|||||
|
Canada
|
488
|
25.90
%
|
470
|
25.90
%
|
747
|
25.90
%
|
|||||
|
France
|
(197)
|
25.82
%
|
(116)
|
25.82
%
|
158
|
25.82
%
|
|||||
|
Germany
|
(197)
|
30.30
%
|
(154)
|
30.30
%
|
82
|
30.30
%
|
|||||
|
Italy
|
(18)
|
24.00
%
|
3
|
24.00
%
|
(14)
|
24.00
%
|
|||||
|
Kazakhstan
|
—
|
20.00
%
|
(69)
|
20.00
%
|
26
|
20.00
%
|
|||||
|
Liberia
|
(42)
|
25.00
%
|
(18)
|
25.00
%
|
—
|
25.00
%
|
|||||
|
Luxembourg
|
556
|
23.87
%
|
806
|
24.94
%
|
633
|
24.94
%
|
|||||
|
Mexico
|
49
|
30.00
%
|
49
|
30.00
%
|
148
|
30.00
%
|
|||||
|
The Netherlands
|
(19)
|
25.80
%
|
(627)
|
25.80
%
|
(9)
|
25.80
%
|
|||||
|
Poland
|
(71)
|
19.00
%
|
(71)
|
19.00
%
|
49
|
19.00
%
|
|||||
|
South Africa
|
(86)
|
27.00
%
|
(58)
|
27.00
%
|
47
|
27.00
%
|
|||||
|
Spain
|
(8)
|
25.00
%
|
(1)
|
25.00
%
|
26
|
25.00
%
|
|||||
|
Ukraine
|
(39)
|
18.00
%
|
(56)
|
18.00
%
|
(267)
|
18.00
%
|
|||||
|
United States
|
68
|
21.00
%
|
83
|
21.00
%
|
103
|
21.00
%
|
|||||
|
Others
|
(9)
|
(8)
|
53
|
||||||||
|
Total
|
582
|
454
|
2,818
|
||||||||
*The statutory tax rates are the (future) rates enacted or substantively enacted by the end of the respective period.
Non-controlling interests
Net income attributable to non-controlling interests was
$41
million, $103 million
and $236 million for the years ended
December 31, 2024, 2023 and 2022, respectively. Net income
attributable to non-controlling interests decreased in 2024
compared to 2023 and 2022 primarily as a result of lower
operating performance.
Net income attributable to equity holders of the parent
ArcelorMittal’s net income attributable to equity holders of the
parent was
$1.3 billion
, $0.9 billion and $9.3 billion for the years
ended December 31, 2024, 2023 and 2022, respectively.
113
|
Management report
|
Liquidity and capital resources
ArcelorMittal’s principal sources of liquidity are cash generated
from its operations and its credi
t facilities at the corporate level.
Because ArcelorMittal is a holding company, it is dependent
upon the earnings and cash flows of, as well as dividends and
distributions from, its operating subsidiaries to pay expenses
and meet its debt service obligations. Cash and cash
equivalents are primarily centralized at the parent level and are
managed by ArcelorMittal Treasury SNC, although from time to
time cash or cash equivalent balances may be held at the
Company’s international subsidiaries or its holding companies.
Some of these operating subsidiaries have debt outstanding or
are subject to acquisition agreements that impose restrictions on
such operating subsidiaries’ ability to pay dividends, but such
restrictions are not significant in the context of ArcelorMittal’s
overall liquidity. Repatriation of funds from operating
subsidiaries may also be affected by tax and foreign exchange
policies in place from time to time in the various countries where
the Company operates, though none of these policies is
currently significant in the context of ArcelorMittal’s overall
liquidity.
In management’s opinion, ArcelorMittal’s credit facilities and
working capital are adequate for its present requirements.
As of December 31, 2024, ArcelorMittal’s cash and cash
equivalents and restricted cash amounted to
$6.5 billion
(including restricted cash of $
84
million, of which $68 million
relating to various environmental obligations, true sales of
receivables programs and letter of credits issued in ArcelorMittal
South Africa) as compared to $7.8 billion (including restricted
cash of $97 million, of which $54 million relating to various
environmental obligations and true sales of receivables
programs in ArcelorMittal South Africa) as of December 31,
2023. In addition, ArcelorMittal had available borrowing capacity
of $5.5 billion under its $5.5 billion revolving credit facility as of
December 31, 2024 compared to $5.4 billion as of December
31, 2023. For information on the currencies of cash and cash
equivalents and restricted cash, see note 6.1.4 to the
consolidated financial statements.
As of December 31, 2024, ArcelorMittal’s total debt, which
includes long-term debt and short-term debt was
$11.6 billion
,
compared to $10.7 billion as of December 31, 2023.
Net debt (defined as long-term debt (
$8.8 billion
) plus short-term
debt (
$2.7 billion
), less cash and cash equivalents, restricted
cash and other restricted funds (
$6.5 billion
)) was
$5.1 billion
as
of December 31, 2024, up from $2.9 billion at December 31,
2023 (long-term debt of $8.4 billion plus short-term debt of $2.3
billion, less cash and cash equivalents and restricted cash of
$7.8 billion). Most of the external debt is borrowed by the parent
company on an unsecured basis and bears interest at varying
levels based on a combination of fixed and variable interest
rates. Gearing (defined as net debt divided by total equity) at
December 31, 2024 and 2023 was
10%
and 5%, respectively.
See note 6.3 to the consolidated financial statements.
The margin applicable to ArcelorMittal’s principal credit facilities
($5.5 billion revolving credit facility and certain other credit
facilities) and the coupons on certain of its outstanding bonds
are subject to adjustment in the event of a change in its long-
term credit ratings. On June 16, 2023, Standard & Poor's
upgraded its outlook on ArcelorMittal to positive on expected
strengthening of the business and affirmed the 'BBB-'
investment grade rating. On February 19, 2024, Moody’s
revised its outlook on ArcelorMittal to 'Positive' from 'Stable' on
expected strengthening of its business profile and structurally
improving its profitability, and affirmed the ‘Baa3’ investment
grade rating. See "Introduction—Risk Factors and Controls—
Risks related to ArcelorMittal's financial position and
organizational structure—ArcelorMittal's indebtedness could
have an adverse impact on its results of operations and financial
position, and the market's perception of ArcelorMittal's leverage
may affect its share price."
ArcelorMittal's $5.5 billion revolving credit facility (see "—
Financings—Principal credit facilities" below) contains restrictive
covenants, which among other things, limit encumbrances on
the assets of ArcelorMittal and its subsidiaries, the ability of
ArcelorMittal’s subsidiaries to incur debt and the ability of
ArcelorMittal and its subsidiaries to dispose of assets in certain
circumstances.
Non-compliance with the covenants in the Company’s borrowing
agreements entitles the lenders under such facilities to
accelerate the Company’s repayment obligations. The Company
was in compliance with the financial covenants in the
agreements related to all of its borrowings as of December 31,
2024.
As of December 31, 2024, ArcelorMittal had guaranteed $375
million of debt of its operating subsidiaries compared to $234
million as of December 31, 2023. See also note 9.4 to the
consolidated financial statements for a description of guarantees
by
ArcelorMittal for joint ventures indebtedness of $
6.3
billion as
of December 31, 2024 including
$4.0
billion issued on behalf of
AMNS India,
$1.2
billion issued on behalf of Calvert,
$303
million in relation to outstanding lease liabilities for vessels
operated by Global Chartering,
$183
million on behalf of Ventos
de Santos Antonio and
$186
million on behalf of Al Jubail.
ArcelorMittal’s debt facilities have provisions whereby the
acceleration of the debt of another borrower within the
ArcelorMittal group could, under certain circumstances, lead to
acceleration under such facilities.
In particular, with respect to joint ventures, on March 16, 2020,
the parent company of AMNS India entered into a $5.1 billion
ten-year term loan agreement with Japan Bank for International
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Cooperation ("JBIC"), MUFG Bank LTD., Sumitomo Mitsui
Banking Corporation, Mizuho Bank Europe N.V., and Sumitomo
Mitsui Trust Bank, Limited (London Branch) in connection with
the acquisition of AMNS India. The obligations under the term
loan agreements are both guaranteed by ArcelorMittal and NSC
in proportion to their interests in the joint venture, 60% and 40%.
On April 28, 2021, the syndicate of Japanese banks amended
the agreement and agreed that the Leverage Ratio financial
covenant would fall away in the event that the Company obtains
an investment grade long-term credit rating (with a stable
outlook) from two rating agencies (which occurred in 2021).
On March 30, 2023, AMNS Luxembourg entered into an
additional $5 billion loan agreement ("JBIC co-financing loan")
with the same syndicate of Japanese banks. As for the above-
mentioned loan, the obligations of AMNS Luxembourg under the
term loan agreement are guaranteed by ArcelorMittal and NSC
in proportion to their interests in the joint venture, 60% and 40%,
respectively. The proceeds obtained through the JBIC co-
financing loan are being used to finance the expansion of AMNS
India’s steelmaking capacity at its Hazira plant from
8.6 millio
n
tonnes to 15 million tonnes. In addition to the primary
steelmaking capacity expansion, the project includes the
development of downstream rolling and finishing facilities that
will enhance AMNS India’s ability to produce value-added steels
for sectors including defense, automotive and infrastructure.
The following table summarizes the repayment schedule of
ArcelorMittal’s outstanding indebtedness, which includes short-
term and long-term debt, as of December 31, 2024.
|
Repayment amounts per year (in billions of $)
|
|||||||
|
Type of indebtedness as of December 31, 2024
|
2025
|
2026
|
2027
|
2028
|
2029 and
beyond
|
Total
|
|
|
Bonds
|
1.0
|
1.0
|
1.2
|
0.5
|
4.2
|
7.9
|
|
|
Commercial paper
|
0.7
|
—
|
—
|
—
|
—
|
0.7
|
|
|
Lease liabilities and other loans
|
1.0
|
0.3
|
0.7
|
0.2
|
0.8
|
3.0
|
|
|
Total gross debt
|
2.7
|
1.3
|
1.9
|
0.7
|
5.0
|
11.6
|
|
The average debt maturity of the Company was 6.7 years as of
December 31, 2024, as compared to 5.7 years as of December
31, 2023.
Further information regarding ArcelorMittal’s outstanding short-
term and long-term indebtedness as of December 31, 2024,
including the breakdown between fixed rate and variable rate
debt, is set forth in note 6 to the consolidated financial
statements. Further information regarding ArcelorMittal’s use of
financial instruments for hedging purposes is set forth in note 6
to the consolidated financial statements.
Financings
ArcelorMittal’s principal credit facilities are described below, for
further information on its existing credit facilities and several
debt financing and repayment transactions completed during
2024, please refer to note 6 to the consolidated financial
statements.
Principal credit facilities
On May 29, 2024, ArcelorMittal signed a new $5.5 billion
revolving credit facility (the "Facility") which replaced the $5.5
billion revolving credit facility dated December 19, 2018
(amended on April 27, 2021) to incorporate a single tranche of
$5.5 billion maturing on May 29, 2029, with two one-year
extension options at the lenders’ discretion (i.e., the options to
extend are to be exercised before the dates that are respectively
one and two years after the signing date of the agreement). The
Facility may be used for general corporate purposes and was
fully available as of December 31, 2024.
On September 30, 2010, ArcelorMittal entered into a $500
million revolving multi-currency letter of credit facility (the “Letter
of Credit Facility”). The Letter of Credit Facility is used by the
Company and its subsidiaries for the issuance of letters of credit
and other instruments. The terms of the letters of credit and
other instruments contain certain restrictions as to duration. The
Letter of Credit Facility, whose amount and maturity have been
revised from time to time, amounted to $395 million
.
On July 31,
2024, the Company refinanced its Letter of Credit Facility by
entering into a $445 million revolving multi-currency letter of
credit facility, which extended the maturity from July 31, 2024 to
July 31, 2027, with two one-year extension options.
Mandatory convertible bond
On March 14, 2023, the Co
mpany through its wholly-owned
subsidiary Hera Ermac made an early repayment of 226,666 of
the 666,666 outstanding unsecured and unsubordinated bonds
mandatorily convertible into preferred shares of such subsidiary
for a total cash consideration of $340 million. See
notes 11.2
and 11.2 to the consolidated financial statements. On December
21, 2023, the Company extended the conversion date of its
bonds mandatorily convertible into preferred shares to January
30, 2026.
Working capital management
The Company makes drawdowns from and repayments on the
Facility in the framework of its cash management. In addition,
the Company has established a number of programs for sales
without recourse of trade accounts receivable to various
115
|
Management report
|
financial institutions (referred to as true sale of receivables
(“TSR”)). As of December 31, 2024, the total amount of trade
accounts receivables sold amounted to
$4.4 billion
. Through the
TSR programs, certain operating subsidiaries of ArcelorMittal
surrender the control, risks and benefits associated with the
accounts receivable sold; therefore, the amount of receivables
sold is recorded as a sale of financial assets and the balances
are removed from the consolidated statements of financial
position at the moment of sale.
As part of the Company’s ongoing efforts to improve its working
capital position, it continually engages with its customers and
suppliers with the aim of improving overall terms, including
pricing, quality, just in time delivery, discounts and payment
terms. Trade accounts payable have maturities from 15 to 180
days depending on the type of material, the geographic area in
which the purchase transaction occurs and the various
contractual agreements.
The Company’s average outstanding
number of trade payable days amoun
ted to 83
over the last 5
years. The ability of suppliers to provide payment terms may be
dependent on their ability to obtain funding for their own working
capital needs and or their ability to early discount their
r
eceivables at their own discretion (the Company estimates that
about $2.8 billion of trade payables were subject to early
discount by its suppliers in 2024 as compared to $2.9 billion in
2023). Given the n
ature and large diversification of its supplier
base the Company does not expect any material impact to its
own liquidity position as a result of suppliers not having access
to liquidity.
As of December 31, 2024, a 5-day reduction in trade
payable days would result in a trade payables decrease by $632
million.
ArcelorMittal's material cash requirements in the near and
medium term
The Company's cash requirements in the near and medium
term are primarily driven by the current commitments,
obligations and other arrangements in place as of December 31,
2024. ArcelorMittal has various purchase commitments for
materials, supplies and capital expenditure incidental to the
ordinary course of business. As of December 31, 2024,
ArcelorMittal had various outstanding obligations mostly related
to:
•
Guarantees, pledges and other collateral related to financial
debt and credit lines given on behalf of third parties and
joint ventures,
•
Capital expenditure commitments mainly related to
commitments associated with investments in expansion and
improvement projects by various subsidiaries,
•
Other commitments comprising mainly commitments
incurred for gas supply to electricity suppliers.
These commitments, obligations and other arrangements will
become due in 2025 and beyond. These various purchase
commitments and long-term obligations will
have an effect on
ArcelorMittal’s future liquidity and capital resources. For further
details on commitments and obligations, please refer to note 9.4
to the consolidated financial statements. ArcelorMittal also has
various environmental commitments and asset retirement
obligations as of December 31,
2024
. For further details on
environmental commitments and asset retirement obligations,
please refer to note 9.1 to the consolidated financial statements.
The Company expects to service its cash requirements in the
near and medium-term with net cash provided by operating
activities. In the future, the Company may enter into additional
financing facilities if required.
Earnings distribution
ArcelorMittal held
84.3
million shares in treasury as of
December 31, 2024, as compared to 33.5 million shares as of
December 31, 2023. As of December 31, 2024, the number of
shares held by the Company in treasury represented 9.88% of
the Company’s total issued share capital. On January 14, 2022,
ArcelorMittal cancelled 45 million treasury shares to keep the
number of treasury shares within appropriate levels. Following
this cancellation,
the aggregate number of shares issued and
fully paid up decreased from 982,809,772
to
937,809,772
.
On
May 18, 2022, ArcelorMittal cancelled 60 million treasury shares
to keep the number of treasury shares within appropriate levels.
Following this cancellation,
the aggregate number of shares
issued and fully paid up decreased from
937,809,772
to
877,809,772
. On April 28, 2023, ArcelorMittal cancelled 25
million treasury shares to keep the number of treasury shares
within appropriate levels. Following this cancellation, the
aggregate number of shares issued and fully paid up decreased
from
877,809,772
to
852,809,772
.
According to the capital return policy, in February 2022, the
Board of Directors recommended an increase of the base
annual dividend to $0.38/share, from $0.30/share, subject to the
approval of shareholders, which was given at the annual general
meeting of shareholders on May 4, 2022. The dividend
amounted to $332 million and was paid on June 10, 2022. In
addition, d
uring 2022, ArcelorMittal completed two consecutive
share buyback programs for a total amount of €1.9 billion ($2.0
billion)
pursuant to an authorization by the annual general
meeting of shareholders on June 8, 2021 and May 4, 2022. See
"Introduction—History and development of the Company—
Capital return policy".
In February 2023, the Board proposed to increase the annual
base dividend to shareholders to $0.44/share. On May 2, 2023
at the annual general meeting of shareholders, the shareholders
approved the Board’s proposed dividend of $0.44 per share.
The dividend amounted to $369 million. In addition, on March
31, 2023, ArcelorMittal completed a share buyback program for
a total amount of €1.4 billion ($1.5 billion) pursuant to an
authorization given by the annual general meeting of
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|
Management report
|
shareholders on May 4, 2022. On May 5, 2023, the Company
announced a new share buy back program of up to 85 million
shares to be completed by May 2025 (subject to market
conditions) under the authorization given by the annual general
meeting of shareholders of May 2, 2023.
In February 2024, the Board of Directors recommended an
increase of the base annual dividend to $0.50/share which was
approved o
n April 30, 2024 at the annual general meeting of
shareholders. The dividend amounted to $393 million. In
addition, at December 31, 2024, ArcelorMittal had repurchased
78 million shares representing 92% of the current share
buyback program for a total value of $2.0 billion. For further
information on buybacks, see "Purchases of equity securities by
the issuer and affiliated purchasers".
On February 6, 2025, ArcelorMittal announced that the Board
has proposed to increase the annual base dividend to
shareholders to $0.55/share in 2025 and subject to the
shareholders' approval at the 2025 annual general meeting of
shareholders.
Additional buybacks under the outstanding buyback program
announced in May 2023 will be allocated to the 2025 capital
return (with a minimum of 50% of post-dividend free cash flow
as per the policy). Share buybacks will continue as per the
Company's defined policy to return a minimum of 50% of post-
dividend free cash flow to shareholders.
Pension/OPEB liabilities
The defined benefit liabilities for employee benefits decreased
by $
0.4
billion to $
2.3
billion as of December 31, 2024, as
compared to $2.7 billion as of December 31, 2023, mainly due
to an increase in discount rates on
pensions
(mainly in Brazil).
For additional information with respect to the Company’s
pension plan and OPEB liabilities, including a breakdown by
region and by type of plan, see note 8.2 to the consolidated
financial statements.
Sources and uses of cash
Years ended December 31, 2024, 2023 and 2022
The following table presents a summary of cash flow of
ArcelorMittal:
|
Summary of cash flow
|
For the year ended December 31,
|
||||
|
(in $ millions)
|
2024
|
2023
|
2022
|
||
|
Net cash provided by operating
activities
|
4,852
|
7,645
|
10,203
|
||
|
Net cash used in investing
activities
|
(4,987)
|
(5,848)
|
(4,483)
|
||
|
Net cash used in financing
activities
|
(680)
|
(3,666)
|
(477)
|
||
Net cash provided by operating activities
For the year ended
December 31, 2024
, net cash provided by
operating activities decreased to
$4.9 billion
as compared with
$7.6
billion for the year ended
December 31, 2023
. Net cash
provided by operating activities included a marginal operating
working capital release of
$0.1 billion
(as compared to an
operating working capital release of $1.6 billion in 2023),
including a
$0.2 billion
and
$0.1 billion
inflow from inventories
and trade accounts payable, respectively, partially offset by a
$0.2 billion
outflow for trade accounts
receivable
. Activity levels
were higher in the fourth quarter of 2024 as compared to the
fourth quarter of 2023 with higher inventory and sales volumes,
which was offset by lower inventory costs and selling prices.
For the year ended December 31, 2023, net cash provided by
operating activities decreased to $
7.6
billion as compared with
$
10.2
billion for the year ended December 31, 2022. Net cash
provided by operating activities included an operating working
capital release of
$1.6 billion
as compared to an operating
working capital investment of $1.3 billion in 2022, including an
inflow from inventories and trade accounts receivable of
$1.6
billion
and
$0.3 billion
, respectively, partially offset by an outflow
for trade accounts payable of
$0.3 billion
. The operating working
capital release was driven primarily by lower accounts
receivable (due to lower prices and lower volumes, including the
impact of normal seasonality at year end), and lower inventories
(primarily due to reduced inventory volumes) in the fourth
quarter of 2023.
For the year ended December 31, 2022, net cash provided by
operating activities increased to $
10.2
billion as compared with
$
9.9
billion for the year ended December 31, 2021.
The
increase in net cash provided by operating activities included an
operating working capital investment of $1.3 billion, comprised
of an outflow for inventories and trade accounts payable of $2.1
billion and $0.3 billion, respectively, partially offset by an inflow
for trade accounts receivable of $1.1 billion. The investment in
operating working capital was mainly driven by elevated raw
material and energy prices although in the fourth quarter of
2022; net cash provided by operating activities included a $2.4
billion operating working capital release, including an inflow for
inventories and trade accounts receivable of $1.7 billion and
$1.1 billion, respectively, partially offset by an outflow of trade
accounts payable of $0.4 billion. The release of operating
working capital was mainly driven by lower investment in
accounts receivable (price and volume) and lower inventories
due to the impact of lower production costs and reduced
inventory volumes.
Net cash used in investing activities
Net cash used in investing activities was
$5.0 billion
for the year
ended
December 31, 2024
as compared to
$5.8 billion
for the
year ended
December 31, 2023
. Capital expenditures were
$4.4
billion
for the year ended
December 31, 2024
as compared to
$4.6 billion
for the year ended
December 31, 2023
. Capital
expenditures for the year ended December 31, 2024 were at the
lower end of the initial guidance (range between $4.5 billion to
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|
Management report
|
$5.0 billion). Similar to 2024, the Company expects 2025 capital
expenditures to be in the range of $4.5 to $5.0 billion with
decarbonization capital expenditures expected to remain stable
between $0.3 to $0.4 billion (as compared to $0.3 billion in
2024) and capital expenditures outside of strategic capital
expenditures and decarbonization projects (which include cost
reduction plans and environment projects as well as general
maintenance capital expenditures) expected to be similar to
2024 ($2.8 billion) in the range of $2.8 billion to $3.1 billion. The
Company expects strategic projects capital expenditures to be
in the range of $1.4 to $1.5 billion in 2025 as compared to $1.3
billion in 2024. See “Properties and capital expenditures—
Capital expenditures” and "—Outlook" below.
In 2024, ArcelorMittal’s major capital expenditures relating to
strategic projects included
Liberia expansion project, renewable
energy project in India and Mardyck electrical steels (France) for
41%, 14% and 14% of the total amount,
respectively
. They also
included
ArcelorMittal Vega Do Sul expansion, Serra Azul mine
direct reduction pellet feed plant and Barra Mansa section mill
(Brazil) and Las Truchas mines (Mexico) revamping and
capacity increase. See also “Properties and capital expenditures
—Capital expenditures—Completed and Ongoing projects”.
Net cash used in other investing activities for the year ended
December 31, 2024 included $
1,048
million cash outflow for the
acquisition of a 28.4% interest in the associate Vallourec, $201
million for the acquisition of Italpannelli Spain and Italy in the
Sustainable Solutions segment and $120 million initial equity
contribution into a new joint venture (see note 2.4.1 to the
consolidated financial statements). Net cash used in investing
activities for the year ended December 31, 2024 also included
$227 million net proceeds from the sale of the Company's
remaining 4% stake in Ereĝli Demir ve Çelik Fabrikalari T.A.S.
(“Erdemir”) and $111 million inflow in relation to the first
installment of an i
ntra-group
loan in connection with the sale of
ArcelorMittal
Temirtau
.
Net cash used in investing activities was
$5.8 billion
for the year
ended
December 31, 2023
as compared to
$4.5 billion
for the
year ended
December 31, 2022
. Capital expenditures were
$4.6
billion
for the year ended
December 31, 2023
as compared to
$3.5 billion
for the year ended
December 31, 2022
. Capital
expenditures for the year ended December 31, 2023 included
$0.2 billion decarbonization capital expenditures, $1.4 billion
strategic projects capital expenditures and $3.0 billion capital
expenditures for cost reduction plans and environment projects
as well as general maintenance capital expenditures.
ArcelorMittal’s major capital expenditures in 2023 included the
following projects: ArcelorMittal Vega Do Sul expansion, Serra
Azul mine direct reduction pellet feed plant, ArcelorMittal Liberia
mine phase 2 premium product expansion, Andra Pradesh
(India) renewable energy project, Barra Mansa section mill,
Mardyck (France) new electrical steels production facilities, Las
Truchas mines (Mexico) revamping and capacity increase,
Monlevade sinter plant, blast furnace and melt shop (now
cancelled).
Net cash used in other investing activities for the year ended
December 31, 2023 included a cash outflow of $2,193 million in
connection with the
acquisition of Companhia Siderúrgica do
Pecém, a cash outflow of $152 million
(net of $4 million of cash
acquired)
for two acquisitions relating to
Sustainable Solutions
operating segment, outflows of $
36
million and $25 million for
investments in Boston Metal and TerraPower, respectively,
through the Company's XCarb® Innovation Fund and a $73
million equity contribution into the joint venture with Casa dos
Ventos
,
partly offset by cash inflows of $
626
million
following the
sale of
265
million shares in Ereĝli Demir ve Çelik Fabrikalari
T.A.S. (“Erdemir”) and $254 million (net of $24 million cash
disposed) related to the sale of ArcelorMittal Temirtau.
Net cash used in investing activities was $4.5 billion for the year
ended December 31, 2022. Capital expenditures were $3.5
billion for the year ended December 31, 2022. Capital
expenditures for the year ended December 31, 2022 included
$0.2 billion decarbonization capital expenditures, $0.7 billion
strategic projects capital expenditures and $2.6 billion capital
expenditures for cost reduction plans and environment projects
as well as general maintenance capital expenditures.
ArcelorMittal’s major capital expenditures in 2022 included the
following projects: ArcelorMittal Vega Do Sul expansion, Serra
Azul mine direct reduction pellet feed plant, ArcelorMittal Liberia
mine phase 2 premium product expansion, ArcelorMittal Mexico
new hot strip mill, Steelanol project in Ghent, as well as the hot
strip mill modernization and #5 CGL conversion to AluSi® in
ArcelorMittal Dofasco (completed in the second and third
quarter of 2022 respectively).
Net cash provided by other investing activities for the year
ended December 31, 2022 included $1.0 billion cash outflow in
connection with several acquisitions, including mainly an
80%
interest in voestalpine’s world-class Hot Briquetted Iron ("HBI")
plant located in Corpus Christi, Texas ($
805
million net of cash
acquired of $
12
million), the UK based scrap recycling business
John Lawrie Metals Limited ($
43
million net of cash acquired of
$
5
million), Architectural Steel Limited, a UK based
manufacturer of bespoke metal fabrications and flashings for
building envelopes ($
39
million net of cash acquired of $
6
million) and
three
companies (ALBA Metall Süd Rhein-Main
GmbH, ALBA Electronics Recycling GmbH and ALBA Metall Süd
Franken GmbH) active in ferrous and non-ferrous metal
recycling in Germany ($
45
million net of cash acquired of $
9
million). Net cash used in other investing activities for the year
ended December 31, 2022 included also $25 million investment
in nuclear innovation company TerraPower and $17.5 million in
118
|
Management report
|
Form Energy Inc. through the Company's XCarb® Innovation
Fund.
Net cash used in financing activities
Net cash used in financing activities was
$0.7 billion
for the year
ended
December 31, 2024
, as compared to
$3.7
billion for the
year ended
December 31, 2023
. In 2024, n
et cash used in
financing activities included primarily $
1,038
million net inflow
(from the issuance of
€500 million
Fixed Rate Notes due 2028
and
€500 million
Fixed Rate Notes due 2031) and $987 million
net inflow from the issuance of $500 million Fixed Rate Notes
due 2034 and $500 million Fixed Rate Notes due 2054. It
included also the repayment at maturity of the Company's €
1.0
billion Fixed Rate Notes due 2024 for the outstanding amount of
$579 million (€529 million). In addition, n
et cash used in
financing activities for the year ended December 31, 2024
included
$1,300 million outflow relating to
share buybacks,
$580
million in dividend payments (see below) and $
203
million
for
lease payments, partly offset by $172 million cash inflow from
capital increase in Finocas subscribed by the Flemish
government. For further details related to capital markets,
liability management transactions and debt repayments in 2024,
see note 6.1.2 to the consolidated financial statements.
Net cash used in financing activities was
$3.7 billion
for the year
ended
December 31, 2023
, as compared to
$0.5
billion for the
year ended
December 31, 2022
. In 2023, n
et cash used in
financing activities included primarily a
€
1,117
million
(
$1,207
million) outflow related to repayment of euro
denominated notes at maturity, a $1,208 million outflow relating
to
share buybacks, and a
$340
million outflow related to the
partial redemption of mandatory convertible bonds. Net cash
used in financing activities for the year ended December 31,
2023 also included $531 million in dividend payments (see
below) and $253 million
for lease payments and other financing
activities.
Net cash used in financing activities was $0.5 billion for the year
ended December 31, 2022 and mainly included a $2.9 billion
outflow with respect to the Company's two completed (and the
third one ongoing) share buyback programs and an outflow of
€486 million ($551 million) for the repayment of outstanding
bonds at maturity. Such outflows were partly offset by an inflow
from issuance of bonds for a total amount of $2.8 billion
including $2.2 billion USD notes with two tranches (five-year
$1.2 billion tranche at 6.55% and a ten-year $1.0 billion tranche
at 6.80%) and €600 million ($580 million) four-year notes at
4.875%, an inflow from o
ffering of five Schuldschein loans for a
total amount of €725 million ($755 million) with maturities of 3
and 5 years, an inflow pursuant to drawdown on European
Investment Bank facility of €280 million ($291 million) and a net
inflow of $335 million from commercial paper. Net cash used in
financing activities for the year ended December 31, 2022 also
included $663 million in dividend payments (see below) and
$160 million
for lease payments and other financing activities.
Dividend payments during the year ended
December 31, 2024
of $580 million included $393 million paid to ArcelorMittal
shareholders and $187 million paid to non-controlling
shareholders in subsidiaries. Dividend payments during the year
ended December 31, 2023 of $531 million included $369 million
paid to ArcelorMittal shareholders and $162 million paid to non-
controlling shareholders in subsidiaries. Dividend payments
during the year ended
December 31, 2022
of $663 million
included $332 million paid to ArcelorMittal shareholders and
$331 million paid to non-controlling shareholders in subsidiaries.
Equity
Equity attributable to the equity holders of the parent decreased
to
$49.2 billion
as of
December 31, 2024
from $
54.0
billion as of
December 31, 2023
primarily due to $3.9 billion foreign
exchange losses resulting from the appreciation of U.S. dollar
against other currencies, $1.3 billion decrease due to share
buyback programs and $0.4 billion dividend payments partly
offset by net income attributable to the equity holders of the
parent of
$1.3 billion
. See note 11 to ArcelorMittal’s consolidated
financial statements for the year ended
December 31, 2024
.
Equity attributable to the equity holders of the parent increased
to
$54.0 billion
as of
December 31, 2023
from $
53.2
billion as of
December 31, 2022
primarily due to net income attributable to
the equity holders of the parent of
$0.9 billion
and $2.4 billion
foreign exchange gains, partly offset by $0.1 billion actuarial
loses, $1.2 billion decrease due to share buyback programs,
and $0.4 billion dividend payments.
Disclosures about market risk
ArcelorMittal is exposed to a number of different market risks
arising from its normal business activities. Market risk is the
possibility that changes in raw materials prices, foreign currency
exchange rates, interest rates, base metal prices (zinc, nickel,
aluminum and tin) and energy prices (oil, natural gas and
power) will adversely affect the value of ArcelorMittal’s financial
assets, liabilities or expected future cash flows.
The fair value information presented below is based on the
information available to management as of the date of the
consolidated statements of financial position. Although
ArcelorMittal is not aware of any factors that would significantly
affect the estimated fair value amounts, such amounts have not
been comprehensively revalued for purposes of this annual
report since that date, and therefore, the current estimates of
fair value may differ significantly from the amounts presented.
The estimated fair values of certain financial instruments have
been determined using available market information or other
valuation methodologies that require considerable judgment in
interpreting market data and developing estimates.
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|
See note 6 to ArcelorMittal’s consolidated financial statements
for quantitative information about risks relating to financial
instruments, including financial instruments entered into
pursuant to the Company’s risk management policies.
Risk management
ArcelorMittal has implemented strict policies and procedures to
manage and monitor financial market risks. Organizationally,
supervisory functions are separated from operational functions,
with proper segregation of duties. Financial market activities are
overseen by the CEO and CFO, the Corporate Finance and Tax
Committee and the Executive Office.
All financial market risks are managed in accordance with the
Treasury and Financial Risk Management Policy. These risks
are managed centrally through Group Treasury by a group
specializing in foreign exchange, interest rate, commodity,
internal and external funding and cash and liquidity
management.
All financial market hedges are governed by ArcelorMittal’s
Treasury and Financial Risk Management Policy, which includes
a delegated authority and approval framework, sets the
boundaries for all hedge activities and dictates the required
approvals for all Treasury activities. Hedging activity and limits
are monitored on an ongoing basis. ArcelorMittal enters into
transactions with numerous counterparties, mainly banks and
financial institutions, as well as brokers, major energy producers
and consumers.
As part of its financial risk management activities, ArcelorMittal
uses derivative instruments to manage its exposure to changes
in interest rates, foreign exchange rates and commodities
prices. These instruments are principally interest rate, currency
and commodity swaps, spots and forwards. ArcelorMittal may
also use futures and options contracts.
Counterparty risk
ArcelorMittal has established detailed counterparty limits to
mitigate the risk of default by its counterparties. The limits
restrict the exposure ArcelorMittal may have to any single
counterparty. Counterparty limits are calculated taking into
account a range of factors that govern the approval of all
counterparties. The factors include an assessment of the
counterparty’s financial soundness and its ratings by the major
rating agencies, which must be of a high quality. Counterparty
limits are monitored on a periodic basis.
All counterparties and their respective limits require the prior
approval of the Corporate Finance and Tax Committee.
Standard agreements, such as those published by the
International Swaps and Derivatives Association, Inc. (ISDA) are
negotiated with all ArcelorMittal trading counterparties.
Currency exposure
ArcelorMittal seeks to manage each of its entities’ exposure to
its operating currency. For currency exposure generated by
activities, the conversion and hedging of revenues and costs in
foreign currencies is typically performed using currency
transactions on the spot market and forward market. For some
of its business segments, ArcelorMittal hedges future cash
flows.
Because a substantial portion of ArcelorMittal’s assets, liabilities,
sales and earnings are denominated in currencies other than
the U.S. dollar (its reporting currency), ArcelorMittal has
exposure to fluctuations in the values of these currencies
relative to the U.S. dollar. These currency fluctuations,
especially the fluctuation of the value of the U.S. dollar relative
to the euro, the Canadian dollar, Brazilian real, South African
rand, Argentine peso, Indian rupee, Polish zloty and Ukrainian
hryvnia, as well as fluctuations in the currencies of the other
countries in which ArcelorMittal has significant operations and/or
sales, could have a material impact on its results of operations.
ArcelorMittal faces transaction risk, where its businesses
generate sales in one currency but incur costs relating to that
revenue in a different currency. For example, ArcelorMittal’s
subsidiaries may purchase raw materials, including iron ore and
coking coal, in U.S. dollar, but may sell finished steel products in
other currencies. Consequently, an appreciation of the U.S.
dollar will increase the cost of raw materials, thereby negatively
impacting the Company’s operating margins, unless the
Company is able to pass along the higher cost in the form of
higher selling prices.
ArcelorMittal faces foreign currency translation risk, which arises
when ArcelorMittal translates the financial statements of its
subsidiaries, denominated in currencies other than the U.S.
dollar for inclusion in ArcelorMittal’s consolidated financial
statements.
The tables below illustrate the impact of a 10% increase or
decrease between the relevant foreign currencies and the U.S.
dollar as of December 31, 2024 and December 31, 2023. A
positive sign means an increase in the net debt.
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|
|
Currency
|
Impact on net debt
translation of a 10%
appreciation of the
U.S. dollar against the
currency
|
Impact on net debt
translation of a 10%
depreciation of the
U.S. dollar against the
currency
|
||
|
In 2024
|
in $ equivalent
(in millions)
|
in $ equivalent
(in millions)
|
||
|
Argentine peso
|
49
|
(49)
|
||
|
Brazilian real
|
13
|
(13)
|
||
|
Euro
|
(111)
|
111
|
||
|
Indian rupee
|
(10)
|
10
|
||
|
Moroccan dirham
|
7
|
(7)
|
||
|
Polish zloty
|
2
|
(2)
|
||
|
Other
|
(3)
|
3
|
|
Currency
|
Impact on net debt
translation of a 10%
appreciation of the
U.S. dollar against the
currency
|
Impact on net debt
translation of a 10%
depreciation of the
U.S. dollar against the
currency
|
||
|
In 2023
|
in $ equivalent
(in millions)
|
in $ equivalent
(in millions)
|
||
|
Argentine peso
|
46
|
(46)
|
||
|
Brazilian real
|
5
|
(5)
|
||
|
Euro
|
93
|
(93)
|
||
|
Indian rupee
|
(1)
|
1
|
||
|
Moroccan dirham
|
8
|
(8)
|
||
|
Polish zloty
|
(22)
|
22
|
||
|
Other
|
4
|
(4)
|
Derivative instruments
ArcelorMittal uses derivative instruments to manage its
exposure to movements in interest rates, foreign exchange rates
and commodity prices. Changes in the fair value of derivative
instruments are recognized in the consolidated statements of
operations or in equity according to nature and effectiveness of
the hedge.
Derivatives used are non-exchange-traded derivatives such as
over-the-counter swaps, options and forward contracts.
For the Company’s tabular presentation of information related to
its market risk sensitive instruments, please see note 6 to the
consolidated financial statements.
Interest rate sensitivity
Cash balances, which are primarily composed of euros and U.S.
dollar, are managed according to the short-term (up to one year)
guidelines established by senior management on the basis of a
daily interest rate benchmark, primarily through short-term
currency swaps, without modifying the currency exposure.
Interest rate risk on debt
ArcelorMittal’s policy consists of incurring debt at fixed and
floating interest rates, primarily in U.S. dollar and euros
according to general corporate needs. Interest rate and currency
swaps are utilized to manage the currency and/or interest rate
exposure of the debt.
For the Company’s tabular presentation of the fair values of its
short and long term debt, please see note 6 to the consolidated
financial statements.
Commodity price risk
ArcelorMittal utilizes a number of exchange-traded commodities
in the steel-making process. In certain instances, ArcelorMittal is
the leading consumer worldwide of certain commodities. In
some businesses and in certain situations, ArcelorMittal is able
to pass this exposure on to its customers. The residual
exposures are managed as appropriate.
Financial instruments related to commodities (base metals,
energy, freight and emission rights) are utilized to manage
ArcelorMittal’s exposure to price fluctuations.
Hedges in the form of swaps and options are utilized to manage
the exposure to commodity price fluctuations.
In case of natural gas, ArcelorMittal has a portfolio of
steelmaking assets with
approximately 75%
of steel being
produced through the BF-BOF route which means resulting by-
product gases are recycled and utilized as a substitute for
natural gas covering a large part of the Company's needs.
Overall, the Company has a policy of hedging a portion of its
natural gas requirements with other strategic long term hedges
in place.
With respect to emission rights, in 2024, the Company has
fulfilled its shortfall requirements through the utilization of some
of its hedges and through some spot purchases by strategically
buying certificates in a planned manner.
For the Company’s tabular presentation of information related to
its market risk sensitive instruments, please see note 6 to the
consolidated financial statements.
In respect of non-exchange traded commodities, ArcelorMittal is
exposed to volatility in the prices of raw materials such as iron
ore (which is generally correlated with steel prices with a time
lag) and coking coal. This exposure is almost entirely managed
through long-term contracts, however some hedging of iron ore
exposures is made through derivative contracts. For a more
detailed discussion of ArcelorMittal’s iron ore and coking coal
purchases, see “Operating and financial review —Key factors
affecting results of operations—Raw materials”.
Outlook
T
he Company expects higher apparent demand in 2025 as
compared to 2024. Outside China, ASC is expected to grow by
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Management report
|
2.5% to 3.5% in 2025 as compared to 2024, which is expected
to support steel shipment growth in 2025.
ArcelorMittal expects the following demand dynamics by key
region in 2025:
•
In the U.S., ASC for flat products is expected to grow within
the range of 1.0% to 3.0%;
•
In Europe, ASC for flat products is expected to grow within
a range of 0% to 2.0%;
•
In Brazil, the Company expects ASC to be stable in 2025
following strong growth in 2024 by 8.0%;
•
In India, the Company expects ASC growth within the range
of 6.0% to 7.0%;
•
In China,
ASC is expected to remain stable.
While near term demand is expected to remain subdued, given
the low inventory environment, especially in Europe, the
Company is optimistic that restocking activity will supplement
real demand improvement in time.
Capital expenditure is expected to remain within the range of
$4.5 billion to $5.0 billion
(of which $1.4 billion to $1.5 billion is
related to strategic growth capital expenditure and $0.3
b
illion to
$0.4 billion on projects related to decarbonization).
Cash flows from operating activities in 2025 is expected to be
supported by working capital optimization. The completion of the
Company’s strategic growth projects is expected to support
structurally higher operating income
in the coming periods.
All information that is not historical in nature and disclosed
under “Operating and financial review”, and in particular in this
Outlook section, is deemed to be a forward-looking statement. A
detailed discussion of principal risks and uncertainties which
may cause actual results and events to differ materially from
such forward-looking statements is included in the section “Risk
factors”.
MANAGEMENT AND EMPLOYEES
Directors and senior management
Board of Directors
ArcelorMittal places a strong emphasis on corporate
governance. The Board of Directors is composed of nine
directors, of which six are independent directors. Mrs. Karyn
Ovelmen is the Lead Independent Director. The Board of
Directors has three committees: The Audit & Risk Committee,
the Appointment, Remuneration and Corporate Governance
Committee ("ARCG Committee") and the Sustainability
Committee. The ARCG Committee and the Audit & Risk
Committee are comprised exclusively of independent directors.
There are two independent directors on the Sustainability
Committee.
The annual general meeting of shareholders on April 30, 2024
acknowledged the expiration of the terms of office of Mr. Tye
Burt, Mrs. Karyn Ovelmen and Mrs. Clarissa Lins. At the same
meeting, the shareholders re-elected Mrs. Karyn Ovelmen and
Mrs. Clarissa Lins for a new term of three years each.
The
retirement of Tye Burt has left a vacancy on the Board, which
the Company continues to work to fill.
In the most recent assessment of the Company’s leadership
structure, the ARCG Committee reviewed the key duties and
responsibilities of the Company’s Executive
Chairman and its
Lead Independent Director as follows:
|
Executive Chairman
|
Lead Independent Director
|
|
* Chairs the Board of Directors' and shareholders' meetings
|
* Provides independent leadership to the Board of Directors
|
|
* Works with the Lead Independent Director to set agenda for the Board of
Directors and reviews the schedule of the meetings
|
* Presides at executive sessions of independent directors
|
|
* Serves as a public face of the Board of Directors and of the Company
|
* Advises the Executive Chairman of any decisions reached and
suggestions made at the executive sessions, as appropriate
|
|
* Serves as a resource for the Board of Directors
|
* Coordinates the activities of the other independent directors
|
|
* Guides discussions at the Board of Directors meetings and encourages
directors to express their positions
|
* Oversees Board of Directors' governance processes, including
succession planning and other governance-related matters
|
|
* Communicates significant business developments and time-sensitive matters
to the Board of Directors
|
* Liaison between the Executive Chairman and the other independent
directors
|
|
* Is responsible for managing day-to-day business and affairs of the Company
|
* Calls meetings of the independent directors when necessary and
appropriate
|
|
* Interacts with the CEO within the Executive Office of the Company and
frequently meets stakeholders and provides feedback to the Board of Directors
|
* Leads the Board of Directors’ self-evaluation process and such other
duties as are assigned from time to time by the Board of Directors
|
The members of the Board of Directors are set out below. Henk Scheffer is the Company Secretary and, accordingly, acts as secretary
of the Board of Directors.
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Management report
|
|
Name
|
Age
5
|
Date of joining the Board
6
|
End of Term
|
Position within ArcelorMittal
5
|
||||
|
Lakshmi N. Mittal
|
74
|
May 1997
|
May 2026
|
Executive Chairman of the Board of Directors
|
||||
|
Aditya Mittal
8
|
48
|
June 2020
|
May 2026
|
Director and Chief Executive Officer
|
||||
|
Vanisha Mittal Bhatia
7
|
44
|
December 2004
|
May 2025
|
Director
|
||||
|
Michel Wurth
3
|
70
|
May 2014
|
May 2026
|
Director
|
||||
|
Karyn Ovelmen
1, 2, 4
|
61
|
May 2015
|
May 2027
|
Lead Independent Director
|
||||
|
Karel de Gucht
1, 4
|
70
|
May 2016
|
May 2025
|
Director
|
||||
|
Etienne Schneider
1, 2, 3, 4
|
53
|
June 2020
|
May 2026
|
Director
|
||||
|
Clarissa Lins
2, 3, 4
|
57
|
June 2021
|
May 2027
|
Director
|
||||
|
Patricia Barbizet
1, 4
|
69
|
May 2023
|
May 2026
|
Director
|
1.
Member of the Audit & Risk Committee.
2.
Member of the ARCG Committee.
3.
Member of the Sustainability Committee.
4.
Non-executive and independent director.
5.
Age and position as of December 31, 2024.
6.
Date of joining the Board of ArcelorMittal or, if prior to 2006, its predecessor Mittal Steel Company NV.
7.
Ms. Vanisha Mittal Bhatia is the daughter of Mr. Lakshmi N. Mittal and sister of Mr. Aditya Mittal.
8.
Mr. Aditya Mittal is the son of Mr. Lakshmi N. Mittal and brother of Ms. Vanisha Mittal Bhatia.
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|
Management report
|
|
Lakshmi N. Mittal
Executive Chairman
|
|
74 years old
Nationality:
Indian
Date of first election:
May 1997
Term start date:
May 2023
Term end date:
May 2026
|
Expertise and experience
Lakshmi N. Mittal is the Executive Chairman of ArcelorMittal since February 2021. He was previously the Chairman and Chief
Executive Officer of ArcelorMittal. He is a renowned global businessman who serves on the boards of various companies and
advisory councils. He is an active philanthropist engaged in the fields of education and child health. Mr. Mittal was born in
Sadulpur in Rajasthan in 1950. He graduated from St Xavier’s College in Kolkata, where he received a Bachelor of
Commerce degree. He has received numerous awards for his contribution to the steel industry over the years and in April
2018, Mr. Mittal was awarded by the American Iron and Steel Institute with the Gary medal award recognizing his great
contribution to the steel industry. He is widely recognized for successfully integrating many company acquisitions in North
America, South America, Europe, South Africa and the CIS. Mr. Mittal is Chairman of the board of Aperam, a member of the
board of Goldman Sachs and a member of the board of Cleveland Clinic. He previously sat on the board of Airbus N.V. He is
a member of the National Investment Council of Ukraine, the World Economic Forum’s International Business Council, the
World Steel Association’s Executive Committee and the Indian School of Business. Mr. Mittal is the father of Aditya Mittal (who
is Chief Executive Officer and a non-independent Director of ArcelorMittal and Aperam) and Vanisha Mittal Bhatia (who is a
non-independent Director of ArcelorMittal). Mr. Mittal is married to Mrs. Usha Mittal. Mr. Mittal is a citizen of India.
|
|
Aditya Mittal
Chief Executive Officer ("CEO")
|
|
48 years old
Nationality:
Indian
Date of first election:
June 2020
Term start date:
May 2023
Term end date:
May 2026
|
Expertise and experience
Aditya Mittal is the Chief Executive Officer since February 2021 and has been a Director since 2020. Aditya led the formation
of ArcelorMittal in 2006, and has held various senior leadership roles, including managerial oversight of the Group’s flat
carbon steel businesses in the Americas and Europe, in addition to his role as CFO of ArcelorMittal until February 2021. He
sees climate change as ArcelorMittal’s top strategic issue and wants the Company to lead the decarbonization of the steel
industry. He is an active philanthropist with a particular interest in child health. Together with his wife Megha, he is a significant
supporter of the Great Ormond Street Children’s Hospital in London, having funded the Mittal Children’s Medical Centre, and
in India, the couple work closely with UNICEF, having funded the first ever country-wide survey into child nutrition, the results
of which are being used by the Government of India to inform relevant policy. Aditya serves on the boards of ArcelorMittal,
Aperam, Iconiq Capital, and is Chairman of AMNS India. He is also an alumnus of the World Economic Forum Young Global
Leader’s program and a member of Harvard University’s Global Advisory Council. He holds a bachelor’s degree in economics
with concentrations in Strategic Management and Corporate Finance from the Wharton School in Pennsylvania, United
States. He is the son of Mr. Lakshmi N. Mittal and brother of Ms. Vanisha Mittal Bhatia. Mr. Aditya Mittal is a citizen of India.
|
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Management report
|
|
Vanisha Mittal Bhatia
Non-independent Director
|
|
44 years old
Nationality:
Indian
Date of first election:
December 2004
Term start date:
May 2022
Term end date:
May 2025
|
Expertise and experience
Vanisha Mittal Bhatia is a non-independent Director of ArcelorMittal. She was appointed as a member of the Board of
Directors of LNM Holdings in June 2004. Ms. Vanisha Mittal Bhatia was appointed to Mittal Steel’s Board of Directors in
December 2004, where she worked in the Procurement department leading various initiatives including "total cost of
ownership program". She joined Aperam in April 2011 and since has held the position of Chief Strategy Officer. She has a
Bachelor of Sciences from the European Business School. Ms. Vanisha Mittal Bhatia is the daughter of Mr. Lakshmi N. Mittal
and the sister of Mr. Aditya Mittal. Ms. Vanisha Mittal Bhatia is a citizen of India.
|
|
Michel Wurth
Non-independent Director
|
|
70 years old
Nationality:
Luxembourgish
Date of first election:
May 2014
Term start date:
May 2023
Term end date:
May 2026
|
Expertise and experience
Michel Wurth is a non-independent Director of ArcelorMittal and a member of the Sustainability Committee. He joined Arbed in
1979 and held a variety of functions before joining the Arbed Group Management Board and becoming its chief financial
officer in 1996. The merger of Aceralia, Arbed and Usinor, leading to the creation of Arcelor in 2002, led to Mr. Wurth’s
appointment as Senior Executive Vice President and Chief Financial Officer of Arcelor. He became a member of
ArcelorMittal’s Group Management Board in 2006, responsible for Flat Carbon Europe, Global R&D, Distribution Solutions
and Long Carbon Worldwide respectively. Michel Wurth retired from the GMB in April 2014 and was elected to ArcelorMittal’s
board of directors in May 2014. He holds a Law degree from the University of Grenoble, France, and a degree in Political
Science from the Institut d’Études Politiques de Grenoble as well as a Master’s of Economics from the London School of
Economics, UK. Mr. Wurth is also doctor of laws honoris causa of the Sacred Heart University, Luxembourg. Mr. Wurth is
Chairman of ArcelorMittal Luxembourg S.A. (a wholly owned subsidiary of ArcelorMittal) as well as Vice Chairman of the
supervisory board of Dillinger Hütte AG and Dillinger Hütte Saarstahl AG (associates of ArcelorMittal). Mr. Wurth is a Board
member of Orion Engineered Carbon S.A. a global company active in the black carbon industry, listed on the NASDAQ. Mr.
Wurth served as Chairman of the Luxembourg Chamber of Commerce between May 2004 and May 2019 and is a member of
the Council of the Central Bank of Luxembourg. He is also non-executive Chairman of Paul Wurth Real Estate S.A. as well as
non-executive Chairman of BIP Investment Partners S.A. and BIP Capital Partners S.A., and non-executive Board member of
Brasserie Nationale. BIP Investment Partners and BIP Capital Partners S.A. are Luxembourg based companies organized as
investment funds investing in small and mid-cap private equity and Brasserie Nationale is a privately owned brewery based in
Luxembourg. Mr. Wurth is vice-chairman of the Luxembourg Red Cross. Mr. Wurth is a citizen of Luxembourg.
|
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Management report
|
|
Karyn Ovelmen
Non-executive and independent Director
|
|
61 years old
Nationality:
USA
Date of first election:
May 2015
Term start date:
June 2021
Term end date:
May 2027
|
Expertise and experience
Karyn Ovelmen is Lead Independent Director of ArcelorMittal as well as the Chairwoman of the ARCG Committee and a
member of the Audit & Risk Committee. From January 2019 to December 31, 2019, Mrs. Ovelmen was the Gas Power
Transformation Leader for the General Electric Company. Prior to that, she served as Executive Vice President and Chief
Financial Officer of Flowserve, a position that she held from June 2015 to February 2017. Previously, she also served as Chief
Financial Officer and Executive Vice President of LyondellBasell Industries NV from 2011 to May 2015, as Executive Vice
President and Chief Financial Officer of Petroplus Holdings AG from May 2006 to September 2010 and as Executive Vice
President and Chief Financial Officer of Argus Services Corporation from 2005 to 2006. Prior to that, she was Vice President
of External Reporting and Investor Relations for Premcor Refining Group Inc. She also spent 12 years with
PricewaterhouseCoopers, primarily serving energy industry accounts. Mrs. Ovelmen is a member of the Hess Corporation
Board of Directors and a member of the Audit Committee as of November 4, 2020. She is also CFO of Newmont, a company
listed on the New York Stock Exchange, since May 2023. Mrs. Ovelmen was a member of the Gates Industrial Corporation
plc. Board of Directors as a non-executive director and was a member of their Audit Committee from December 2017 to March
2019. Mrs. Ovelmen holds a Bachelor of Arts degree from the University of Connecticut, USA, and is a Certified Public
Accountant ("CPA"). Mrs. Ovelmen is a citizen of the United States of America.
|
|
Karel de Gucht
Non-executive and independent Director
|
|
70 years old
Nationality:
Belgian
Date of first election:
May 2016
Term start date:
May 2022
Term end date:
May 2025
|
Expertise and experience
Karel de Gucht
is a non-executive and independent Director and a member of the Audit & Risk Committee. Mr. De Gucht is a
Belgian Minister of State. He was the European Commissioner for Trade in the 2nd Barroso Commission from 2010 to 2014
and for Development and Humanitarian Aid in the first Barroso Commission from 2009 to 2010. Previously, Mr. De Gucht
served as Belgium's Minister of Foreign Affairs from 2004 to 2009 and Vice Prime Minister of Belgium from 2008 to 2009. In
addition, in 2006, he was the Chairman in Office of the Organization for Security and Cooperation in Europe (OSCE) and
Member of the Security Council of the United Nations from 2007 to 2008. Since 1991, Mr. De Gucht has been a Professor of
Law at the VUB (the Dutch-speaking Free University Brussels). He is currently a member of the European Advisory Board of
CVC Capital Partners, a member of the board of directors of the listed company Proximus NV and the president of the
Brussels School of Governance at the VUB (Free University Brussel), a leading learning and research institute. Karel De
Gucht is a member of the Board of Directors of nv EnergyVision, a non-listed company active in renewables. In the course of
2021, Mr. De Gucht was nominated Chairman of the Board of YOUSTON NV, a non-listed Belgian company specialized in
archiving, digitalization and processing. Mr. De Gucht holds a Master of Law degree from the VUB and is a Belgian citizen.
|
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|
Management report
|
|
Etienne Schneider
Non-executive and independent Director
|
|
53 years old
Nationality:
Luxembourgish
Date of first election:
June 2020
Term start date:
May 2023
Term end date:
May 2026
|
Expertise and experience
Etienne Schneider is a non-executive and independent Director and a member of the Audit & Risk Committee, the ARCG
Committee and the Sustainability Committee . Mr. Schneider joined the government of Luxembourg in 2012 as Minister of the
Economy and Foreign Trade before being appointed Deputy Prime Minister, Minister of the Economy, Minister of Internal
Security and Minister of Defense in 2013. In 2018, Mr. Schneider became Deputy Prime Minister, Minister of the Economy
and Minister of Health and in February 2020 retired from politics. He previously filled several positions as a senior civil
servant, such as a research assistant at the European Parliament in Brussels, economist for the LSAP parliamentary group in
the Chamber of Deputies and project leader with NATO in Brussels. He also served as a government advisor responsible for
various Directorates. Mr. Schneider became a member of the executive board of several companies, such as the Société
électrique de l’Our (SEO), Enovos International SA, Enovos Deutschland AG and the National Credit and Investment
Company (SNCI). Upon being appointed minister in 2012, he resigned from all of these positions. Since 2020, Mr. Schneider
is a member of the board of Sofidra which is the Luxembourg holding of the international dredging company Jan de Nul. In
2021, Mr. Schneider became president of the board of LuxTP, a Luxembourgish affiliate of the Belgian construction company
Besix Group in which he has held a position as an independent board member since 2020. Mr. Schneider was a member of
the board of a non-listed Luxemburgish company Mikro Kapital until October 2024. Mr. Schneider holds a degree from the
Institut Catholique des Hautes Etudes Commerciales (ICHEC) in Brussels and from Greenwich University in London in
commercial and financial sciences. Mr. Schneider is a citizen of Luxembourg.
|
|
Clarissa Lins
Non-executive and independent Director
|
|
57 years old
Nationality:
Brazilian
Date of first election:
June 2021
Term start date:
June 2021
Term end date:
May 2027
|
Expertise and experience
Clarissa Lins is a non-executive and independent Director of ArcelorMittal as well as the Chairwoman of the Sustainability
Committee. Mrs. Lins is a senior executive with consolidated experience in strategy, sustainability, and corporate governance.
With a distinguished education background in economics, she worked on relevant projects in the public sector at the
beginning of her career - she was part of Brazil’s Ministry of Finance team that produced the economic stabilization program
known as the Real Plan in 1994, under President Cardoso. She also served as an Advisor to the President of Brazil’s BNDES
Development Bank, participating in the structuring of the country’s large-scale privatization projects from 1995 to 1999. She
was head of Corporate Strategy at Petrobras from 1999 to 2002, when the state-owned oil and gas company shifted its
strategy and improved its corporate governance practices while doing an IPO at the NYSE. Mrs. Lins moved her focus more
specifically towards Sustainability in 2004, when she joined the FBDS Fundação Brasileira para o Desenvolvimento
Sustentável (Brazilian Foundation for Sustainable Development). In 2013, she founded the consultancy Catavento, advising
corporations in the areas of strategy and sustainability. Mrs. Lins was the President of the Brazilian Institute of Petroleum and
Gas (IBP) from November 2019 until March 2021, after serving as Executive Director for more than 3 years. She serves on
boards and committees of leading companies operating in Brazil - including Suzano's Sustainability Committee (the world’s
largest producer of market pulp) and the board of directors of Votorantim Cimentos. Other companies in which she has held
relevant board committee positions include Shell, Vale, Petrobras and Vibra Energia. Mrs. Lins is a citizen of Brazil.
|
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|
Management report
|
|
Patricia Barbizet
Non-executive and independent Director
|
|
69 years old
Nationality:
French
Date of first election:
May 2023
Term start date:
May 2023
Term end date:
May 2026
|
Expertise and experience
Mrs. Patricia Barbizet is a non-executive and independent Director and Chairwoman of the Audit & Risk Committee. Mrs.
Barbizet is Chief Executive Officer of Temaris & Associés, lead independent director of Pernod Ricard (listed company). In
addition, she is chairwoman of AFEP (Association française des entreprises privées) and a member of the Board of Directors
of CMA CGM. She started her career as International Treasurer in Renault Véhicules Industriels, and then as Chief Financial
Officer of Renault Crédit International. In 1989, Mrs. Barbizet joined the Groupe Pinault as Chief Financial Officer. She was
Chief Executive Officer of Artémis, the investment company of the Pinault family, from 1992 to 2018. Mrs. Barbizet was Chief
Executive Officer and chairwoman of Christie’s International from 2014 to 2016, served as a qualified independent member on
the boards of PSA Peugeot-Citroen, Air France-KLM, Groupe Bouygues, FNAC-DARTY, AXA, Total, as well as chairwoman of
the Investment Committee of the “Fond Stratégique d’Investissement” from 2008 until 2013, and chairwoman of the "Comité
de surveillance des investissements d'avenir" of the Secrétariat Général pour l'Investissement (SGPI) until 2023. Mrs.
Barbizet graduated from the École Supérieure de Commerce de Paris (ESCP Business School). Mrs. Barbizet is a citizen of
France.
|
Senior management
As of December 31, 2024, ArcelorMittal’s senior management
was comprised of the Executive Office supported by nine other
Executive Officers. ArcelorMittal’s Executive Office was
comprised of the Executive Chairman, Mr. Lakshmi N. Mittal and
the CEO, Mr. Aditya Mittal. Together, the Executive Officers are
responsible for the implementation of the Company strategy,
overall management of the business and all operational
decisions.
|
Name
|
Age
|
Position
|
||
|
Lakshmi N. Mittal
1
|
74
|
Executive Chairman of ArcelorMittal
|
||
|
Aditya Mittal
1
|
48
|
Chief Executive Officer of ArcelorMittal
|
||
|
Genuino Christino
1
|
53
|
Chief Financial Officer of ArcelorMittal
|
||
|
Kleber Silva
1
|
61
|
Executive Vice President, CEO ArcelorMittal Mining
|
||
|
Jefferson de Paula
1
|
66
|
Executive Vice President, CEO ArcelorMittal South America Long
|
||
|
Geert Van Poelvoorde
1
|
59
|
Executive Vice President, CEO ArcelorMittal Europe
|
||
|
John Brett
1
|
59
|
Executive Vice President, CEO ArcelorMittal North America
|
||
|
Bradley Davey
1
|
60
|
Executive Vice President and Head of Corporate Business Optimization
|
||
|
Vijay Goyal
1
|
53
|
Executive Vice President
|
||
|
Dilip Oommen
1
|
66
|
Executive Vice President, CEO AMNS India
|
||
|
Stephanie Werner-Dietz
1
|
52
|
Executive Vice President, Head of Human Resources
|
1.
Age and position as of December 31, 2024.
Lakshmi N. Mittal
(See “—Board of Directors”).
Aditya Mittal
(See "—Board of Directors").
128
|
Management report
|
|
Genuino M. Christino
Member of the Group management committee,
Chief Financial Officer.
|
|
53 years old
Nationality:
Brazilian
|
Expertise and experience
Genuino M. Christino is the Group Chief Financial Officer and Executive Vice President of ArcelorMittal since February 2021.
He is a member of the Group management committee since 2016. Prior to Mr. Christino’s appointment as Chief Financial
Officer, he was the Group Head of Finance since 2016. As Chief Financial Officer, Mr. Christino is responsible for all of the
Company’s financial functions, including treasury, corporate finance, accounting, performance management, insurance and
investor relations. In addition, Mr. Christino oversees the Group's Merger & Acquisitions, Legal and IT activities and is a
member of the Company’s Investment Allocation Committee. Mr. Christino also heads the Company’s Corporate Finance and
Tax Committee where all key financial transactions of the Group are reviewed and approved. Since August 2024, Mr. Christino
is a member of the Board of Directors of Vallourec, in which ArcelorMittal has acquired a 28% equity stake. Prior to joining
ArcelorMittal in 2003, Mr. Christino had spent ten years at KPMG in Brazil and in the United Kingdom, as an auditor and a
consultant. Mr. Christino holds a bachelor’s degree in accounting and business administration from the Universidade Paulista
in São Paolo, Brazil and has also completed an Executive MBA Program from the Dom Cabral Foundation in Belo Horizonte,
Brazil. Mr. Christino is a citizen of Brazil.
|
|
Kleber Silva
Member of the Group management committee,
CEO of ArcelorMittal Mining.
|
|
61 years old
Nationality: Brazilian and British
|
Expertise and experience
Kleber Silva is a member of the Group management committee, Executive Vice President and the Chief Executive Officer of
ArcelorMittal Mining. He rejoined ArcelorMittal in April 2024. Before rejoining ArcelorMittal, Kleber served as the Deputy Chief
Executive Officer and Chief Operating Officer of Eramet since 2017, where he oversaw global mining and metallurgical
operations across various commodities, including manganese, nickel, zircon, titanium, mineral sands, manganese alloys and
lithium. With over 37 years in the mining and metals industry, Mr. SIlva began his career in 1988 at MBR and Vale, where he
took on various senior operational responsibilities in Brazil. He also gained international experience at Québec Cartier Mining
Company in Canada (later known as ArcelorMittal Mines Canada). After joining ArcelorMittal in 2006 as Vice President
overseeing mining operations, he advanced to Head of Iron Ore Operations and Chief Technology Officer for Iron Ore Mines
in 2008. In May 2012, he was promoted to Executive Vice President and Head of Iron Ore of ArcelorMittal. He brings a proven
track record of accomplishments in safety, value creation, growth, turnaround strategies, and operational excellence. Mr. Silva
holds a Master’s degree from École Nationale Supérieure des Mines de Paris, France, and is a qualified mining engineer from
Escola de Minas da Universidade Federal de Ouro Preto (UFOP), Brazil. Mr. SIlva is a citizen of both Brazil and the United
Kingdom.
|
129
|
Management report
|
|
Jefferson de Paula
Member of the Group management committee,
President of ArcelorMittal Brasil,
CEO of ArcelorMittal Long LATAM and Mining Brazil.
|
|
66 years old
Nationality:
Brazilian
|
Expertise and experience
Jefferson de Paula is a member of the Group management committee, President of ArcelorMittal Brazil, CEO of ArcelorMittal
Long LATAM and Mining Brazil. Counting over 40 years of work in the steel industry, Mr. De Paula has been with the Group
since 1991, occupying several executive positions in Brazil, Argentina, Americas and Europe. He was the first Brazilian Vice-
President and CEO of ArcelorMittal to lead in Europe, being responsible for plants in different countries such as Spain,
Luxembourg, Germany, Poland and Morocco. He is Chairman of the Board of Directors of Belgo Bekaert Arames, Member of
the Board of Directors of ArcelorMittal Argentina, Member of the Board of Brazil Steel Association (Aço Brasil), Member of the
Board of the Latin American Steel Association (ALACERO) and Vice President of the Board and Member of the Strategic
Board of Minas Gerais State Industry Association (FIEMG). Mr. De Paula holds a degree in metallurgical engineering from
Universidade Federal Fluminense (Brazil) and has completed executive trainings at business schools such as Fundação Dom
Cabral (Brazil), Universidad Austral - IAE School of Business (Argentina), Insead (France) and Kellogg School of
Management, Northwestern University (USA). Mr. De Paula is a citizen of Brazil.
|
|
Geert Van Poelvoorde
Member of the Group management committee.
CEO ArcelorMittal Europe
|
|
59 years old
Nationality:
Belgian
|
Expertise and experience
Geert Van Poelvoorde is a member of the Group management committee. He started his career in 1989 as a project engineer
at the Sidmar Ghent hot strip mill, where he held several senior positions in the automation and process computer
department. He moved to Stahlwerke Bremen in 1995 as senior project manager. Between 1998 and 2002, he headed a
number of departments, and in 2003 he was appointed director of Stahlwerke Bremen, responsible for operations and
engineering. In 2005, Mr. Van Poelvoorde returned to ArcelorMittal Ghent to take up the position of Chief Operating Officer. In
2008, he became CEO of ArcelorMittal Ghent with direct responsibility for primary operations. He was appointed CEO of the
Business Division North within Flat Carbon Europe in 2009. In January 2014, he was appointed CEO of Flat Carbon Europe
and Purchasing and in February 2021, he became CEO of ArcelorMittal Europe. Since November 2015, he is a member of
the executive committee of Eurofer (as president between 2015 and the end of 2022), the European steel federation and is
serving on several boards. He graduated from the University of Ghent with a degree in civil engineering and electronics. Mr.
Van Poelvoorde is a citizen of Belgium.
|
130
|
Management report
|
|
John Brett
Member of the Group management committee,
Chief Executive Officer of ArcelorMittal North America.
|
|
59 years old
Nationality:
USA
|
Expertise and experience
John Brett, is a member of the Group management committee, an Executive Vice-President and the Chief Executive Officer of
ArcelorMittal North America. He joined the group at former Inland Steel in 1988 as an associate accountant, and progressed
to become a manager specializing in financial analysis and systems in 1997. In 1998, Mr. Brett took on the role of controller
for Ispat Inland Steel and in 2005, he was promoted to vice president, finance and planning and controller for Mittal Steel
USA. In 2012, Mr. Brett was appointed executive vice president finance, planning and procurement for ArcelorMittal USA.
Prior to becoming CEO of ArcelorMittal North America in January 2021, Mr. Brett was CEO of ArcelorMittal USA. Mr. Brett
holds an MBA from the University of Chicago and is a graduate in economics from DePauw University. Mr. Brett is a citizen of
the United States of America.
|
|
Bradley Davey
Member of the Group management committee,
Head of Corporate Business Optimization.
|
|
60 years old
Nationality:
Canadian
|
Expertise and experience
Bradley Davey is a member of the Group management committee, Executive Vice President and Head of Corporate Business
Optimization. He joined Dofasco in 1986 as a project engineer in the central maintenance department, joined assigned
maintenance in 1989, and then the hot strip mill ("HSM") in 1990. He held various positions in the HSM before becoming a
Business Unit Manager in 1996. He gained international manufacturing experience through this role by leading two separate
multi-year technical exchanges and through leading Dofasco’s HSM modernization project. In 2002, he changed careers to
marketing as a Manager of Strategic Marketing, led Dofasco’s marketing process redesign project before becoming General
Manager of Marketing in 2005, then Director of Industry Sales in 2007, and then Vice President Commercial in 2008. In 2014,
he became Chief Marketing Officer ("CMO") North America Automotive, then became CMO North America Flat Rolled later in
2014. In 2016, he became CMO of Global Automotive along with CMO North America. In 2018, Mr. Davey became CEO of
ArcelorMittal North America and held this position until his nomination to Head of Corporate Business Optimization in early
April 2021. Currently based in Canada, Mr. Davey has responsibility for Global Automotive, R&D, CTO, Corporate Health and
Safety, Commercial Coordination, Corporate Capital Goods Procurement, Corporate Communications and Corporate
Responsibility, Automotive, JV’s in China and India, Tailored Blanks Americas, and is Vice Chairman of the Investment
Allocation Committee. Mr. Davey holds a mechanical engineering degree from McMaster University, Canada. Mr. Davey is a
citizen of Canada.
|
131
|
Management report
|
|
Vijay Goyal
Member of the Group management committee,
Executive Vice President
|
|
53 years old
Nationality:
Indian
|
Expertise and experience
Vijay Goyal is a member of the Group management committee and Chief Executive Officer of the business segment
comprising ArcelorMittal Kryvyi Rih, Ukraine and the joint venture ArcelorMittal Tubular Products Jubail (AMTPJ). He has been
a member of the Group management committee since October 2016 and was nominated executive officer in February 2022.
Mr. Goyal joined Mittal Steel in 1999, working in various positions in the finance function. In 2007, he became chief financial
officer and head of strategy for Long Carbon Europe, followed by his appointment as chief financial officer and head of central
supply chain for Flat Carbon Europe in mid-2008. From 2014 to 2016, Mr. Goyal was chief financial officer of ArcelorMittal
Europe and additionally in charge of legal, IT and Shared Service Centre Europe, before being appointed chief executive
officer ArcelorMittal Downstream Solutions. In his prior role, Mr. Goyal led on several strategic projects, including the
acquisition of Essar Steel India with joint venture partner Nippon Steel, to create ArcelorMittal Nippon Steel (AM/NS) India. Mr.
Goyal graduated from St Xavier’s College, Calcutta. He is a chartered accountant and cost and works accountant from
respective institutes in India. In 2021, he was recognized with the “Global Achiever” award by The Institute of Chartered
Accountants of India. He has also completed executive education programs at the Wharton and Stanford Business Schools.
Mr. Goyal is a citizen of India.
|
|
Dilip Oommen
Member of the Group management committee,
Chief Executive Officer of AMNS India.
|
|
66 years old
Nationality:
Indian
|
Expertise and experience
Dilip Oommen is a member of the Group management committee. He was appointed CEO of AMNS India in
December 2019 after the acquisition of Essar Steel India (ESIL). He has more than 40 years of experience in the steel
industry. Mr. Oommen joined ESIL in 2003 as chief operating officer, before moving to senior leadership positions
within the company. He was appointed Managing director and Chief Executive Officer of ESIL in 2019. Prior to joining
ESIL, Mr. Oommen had worked in various leadership roles in Hadeed (SABIC), both in Long and Flat Product
divisions. In 2020, Mr. Oommen was elected President of the Indian Steel Association, the industry body that
represents major public and private sector steel companies in India. He has also served in the past as Co-Chair of the
Federation of Indian Chambers of Commerce & Industry’s ("FICCI") Steel Committee, one of several industry
leadership roles he has taken on during his career. He is also a member of the Advisory Committee of the Steel
Ministry of India. Mr. Oommen is a metallurgical engineer from the Indian Institute of Technology, Kharagpur. He has
attended several management and technical programs across the globe. Mr. Oommen is a citizen of India.
|
132
|
Management report
|
|
Stephanie Werner-Dietz
Member of the Group management committee.
Head of Human Resources
|
|
52 years old
Nationality:
German
|
Expertise and experience
Stephanie Werner-Dietz is a member of the Group management committee. She was appointed head of human resources on
September 1, 2022. She joined ArcelorMittal with a long ranging HR experience of almost 25 years at Nokia, which she joined
in 1998. Throughout her career, Mrs. Werner-Dietz has held different HR leadership positions in various countries. She held
multiple HR business partner and expert roles across the company, and she was chief people officer of Nokia, based in
Finland from January 2020 until her arrival at ArcelorMittal. Mrs. Werner-Dietz is a graduate in applied business languages
(Chinese) and international business studies from the University of Applied Sciences of Bremen, Germany. Mrs. Werner-Dietz
is a citizen of Germany.
|
133
|
Management report
|
Compensation
|
Content
|
|
|
Annual statement from the Chairman of ARCG Committee
|
|
|
Board of Directors
|
|
|
Remuneration at a glance - senior management
|
Overview of the Company's remuneration policy and rationale of each
performance metric
|
|
Remuneration at a glance - 2024 pay outcomes
|
Comparison of pay outcomes 2024 vs. 2023 vs. 2022 vs. 2021 vs. 2020
Explanation of results for 2023 short-term incentives paid in 2024
|
|
Remuneration
|
|
|
Remuneration strategy
|
Explanation of what informs the ARCG's decision on pay
|
|
Remuneration policy
|
Explanation of policies applied to senior management
|
|
Remuneration mix
|
Overview of the remuneration mix for senior management
|
|
2024 Total remuneration
|
Overview of 2024 outcomes
|
|
Short-term incentives
|
Description of short-term incentives plan ("STI")
|
|
ArcelorMittal Equity Incentive Plan
|
Description of long-term incentive plan ("LTIP" or "LTI"s)
|
|
Other benefits
|
Description of other benefits
|
|
Clawback
|
Explanation of Company’s clawback policy (Exhibit 97.1)
|
|
Abbreviations
|
|
|
EBITDA
|
Operating income plus depreciation, impairment expenses, special items and
income (loss) from associates, joint ventures and other investments (excluding
impairments)
|
|
FCF
|
Free cash flow
|
|
STI
|
Short-term incentives
|
|
LTI/LTIP
|
Long-term incentives (plans)
|
|
EPS
|
Earnings per share
|
|
ESG
|
Environment, social and governance
|
|
PSU
|
Performance share units
|
|
RSU
|
Restricted share units
|
|
ROCE
|
Return on capital employed
|
|
TSR
|
Total shareholder return
|
134
|
Management report
|
Annual statement from the Chairwoman of ARCG Committee
Dear Shareholders,
In my capacity as Appointments, Remuneration & Corporate
Governance Committee (“ARCG”) chair I would like to provide
you with a summary of the Committee’s major focus and an
overview of the main actions taken in 2024 and to be taken in
2025.
Safety
Safety continues to be a priority for all levels of the Company.
This includes the ARCG Committee working closely with the
Sustainability Committee.
The safety audit was completed this year against the backdrop
of a necessity to strengthen Group safety performance. We
were satisfied with the rigor and extensive analysis that dss+
performed during the nine-month audit of the Group and the
Board had a number of meetings to discuss safety and the
audit throughout the year. The audit included 155 site audits
(including joint ventures) on the three main occupational risks;
process safety management audits on the 14 highest risk
assets; and a thorough examination of health and safety
management practices across the Group. Overall, dss+
confirmed that ArcelorMittal has the right policies and
standards but the biggest challenge is to make sure that
implementation is uniform across the Group. The ARCG
Committee reviewed, strengthened and approved appropriate
targets for long and short-term incentives related to health &
safety performance improvements and this was an important
focus area in 2024.
The Company has committed to implementing the
recommendations provided by dss+. Business specific plans
have already been developed with clear actions for
implementation. The health and safety assurance model has
also been strengthened to provide a more comprehensive
oversight and the third line will report now directly to the Board.
To support these actions, the ARCG Committee also had
requested benchmarking of ArcelorMittal health & safety
related incentives with other steel and mining companies. The
analysis shows the Company is well aligned with industry best
practice.
Business and results
Market conditions were particularly challenging in 2024, with
unsustainably low steel prices in the Company’s core markets,
and aggressive exports from China.
Despite these challenges, ArcelorMittal delivered a resilient
financial performance in 2024, which reflects the structural
business improvements and the benefits of regional/product
diversification. The Company has grown the business,
rewarded shareholders all whilst maintaining a strong balance
sheet.
ArcelorMittal remains committed to its long-term strategy and
has continued to invest in growth and sustainability initiatives.
Several recently completed projects such as the Vega CMC in
Brazil and a 975MW renewables project in India are performing
well. This first completed renewables project started supplying
power to AMNS India in September 2024. The Vega CMC
project is also fully up and running and produced its first
Magnelis® coil.
People strategy, remuneration, nomination, and governance
In April 2024, Mrs. Patricia Barbizet was appointed as
chairwoman of the Audit & Risk Committee.
The ARCG Committee members engaged with shareholders in
the context of proposals to the Annual General Meeting in May
2024 and specific governance and remuneration related
questions of concern to shareholders. Feedback was
constructive.
During January 2025, the Lead Independent Director and
ARCG Chair conducted the Annual Self-Assessment of the
Board of Directors relating to 2024, which has shown that the
Company continues to place a ubiquitous focus on the Health
and Safety improvement (including fatality reduction),
decarbonization and other ESG measures, but also on
deployment of capital in the long term and for the interests of
investors. The analysis reveals a well-functioning board with
strong fundamentals in governance, communication, and
strategic oversight, while highlighting specific areas for future
focus.
The Committee reviewed the long-term incentive plans for
Executive Officers and the ArcelorMittal equity plan for 2025.
During the second half of 2024, the Committee conducted the
review of the succession plan for the Company’s Executive
Office and Executive Vice Presidents. The Committee also
worked on the search for a non-executive Director. This
process is ongoing.
The ARCG Committee also reviewed and supported the
outcome of the Company’s
Speak Up+ survey-
related
improvement initiatives, targets and performance.
Climate and Sustainability
ArcelorMittal’s existing capabilities in low-carbon metallics and
EAF steelmaking puts it in a strategically advantaged position
to provide access to low-carbon intensity steel products to
customers. ArcelorMittal’s XCarb® low-carbon emissions steel,
which has a carbon footprint of as low as 300kg per tonne of
steel produced, has seen sales grow to approximately 0.4
million tonnes in 2024.
135
|
Management report
|
Energy infrastructure, policy and the market environment in
Europe have not moved in a favorable direction for
decarbonization. Before taking final investment decisions on
the Company’s decarbonization projects, ArcelorMittal need to
have greater clarity on the policy to ensure higher cost
steelmaking can be competitive in Europe without a global
carbon price.
However, the Company continues to move forward with
decarbonization projects which are economic. In 2024,
ArcelorMittal started the construction of a 1.1 million-tonne EAF
in Gijόn, Spain and is progressing on the EAF expansion at
Sestao, Spain to 1.6 million tonnes. Outside of Europe, in the
United States, AM/NS Calvert is commissioning a new 1.5
million tonne per annum EAF enhancing its ability to meet
automotive demand.
At the same time, the Company continues to secure the
resources for decarbonization. In 2024, the Company
increased its renewable energy portfolio to 2.1 GW with
975MW commissioned in India and equity investments in Brazil
and Argentina.
Going forward
Safety remains the number one focus for 2025, and
ArcelorMittal will be monitoring alongside shareholders the
progress in implementing the recommendations of the safety
audit.
There are certainly several challenges to navigate, but the
long-term outlook for steel is positive. ArcelorMittal aims to
leverage its geographic presence and strong R&D capabilities
to meet stakeholder needs and produce smarter steels – for
people and planet.
We are committed to delivering sustainable value to
shareholders and thank you for your investment and trust in
ArcelorMittal.
Yours Sincerely,
Karyn Ovelmen
136
|
Management report
|
Board of Directors
Directors’ fees
The ARCG Committee of the Board of Directors prepares
proposals on the remuneration to be paid annually to the
members of the Board of Directors.
At the April 30, 2024 annual general meeting of shareholders,
the shareholders approved the annual remuneration for non-
executive directors for the 2023 financial year, based on the
following annual fees (euro denominated amounts are
translated into U.S. dollar as of December 31, 2023):
•
Basic director’s remuneration: €158,095 ($174,695);
•
Lead Independent Director’s remuneration: €222,985
($246,398);
•
Additional remuneration for the Chair of the Audit &
Risk Committee: €30,675 ($33,896);
•
Additional remuneration for the other Audit & Risk
Committee members: €18,877 ($20,859);
•
Additional remuneration for the Chairs of the other
committees: €17,697 ($19,555); and
•
Additional remuneration for the members of the other
committees: €11,798 ($13,037).
The total annual remuneration (euro denominated amounts are translated into U.S. dollar as the prevailing closing rate) of the members
of the Board of Directors for their service for the last five financial years was as follows:
|
Year ended December 31,
|
|||||
|
(Amounts in $ thousands except Long-term incentives information)
|
2024
|
2023
|
2022
|
2021
|
2020
|
|
Base salary
1
|
3,371
|
3,214
|
3,199
|
3,483
|
2,635
|
|
Director fees
|
1,442
|
1,658
|
1,676
|
1,784
|
1,706
|
|
Short-term performance-related bonus
1
|
—
|
—
|
6,388
|
5,134
|
935
|
|
Long-term incentives
1, 2
|
241,856
|
141,973
|
141,564
|
109,143
|
148,422
|
1
Includes Executive Chairman and CEO in 2024, 2023, 2022 and 2021 and Chairman and CEO and President and CFO in 2020. Slight differences between the years are
possible, due to foreign currency effects.
The Executive Chairman and the CEO voluntarily renounced their 2023 Performance Bonus ($2.8 million and $3.1 million,
respectively) (which would otherwise have been paid in 2024) due to the high number of fatalities.
2
See “Management and employees—Compensation—Remuneration—ArcelorMittal Equity Incentive
Plan
.”
The annual remuneration (euro denominated amounts are translated into U.S. dollar at the prevailing closing rate) for the last five
financial years to the current and former members of the Board of Directors for services in all capacities in the years in which they were
Directors was as follows:
|
Year ended December 31,
|
||||||
|
(Amounts in $ thousands)
|
2024
1
|
2023
1
|
2022
1
|
2021
1
|
2020
1
|
|
|
Lakshmi N. Mittal
|
1,580
|
1,536
|
1,529
|
1,700
|
1,374
|
|
|
Aditya Mittal
|
1,791
|
1,678
|
1,670
|
1,783
|
1,261
|
|
|
Vanisha Mittal Bhatia
|
164
|
175
|
169
|
176
|
186
|
|
|
Suzanne P. Nimocks
|
—
|
—
|
76
|
189
|
200
|
|
|
Bruno Lafont
|
—
|
96
|
277
|
302
|
306
|
|
|
Tye Burt
|
63
|
201
|
194
|
194
|
200
|
|
|
Karyn Ovelmen
|
274
|
269
|
201
|
221
|
223
|
|
|
Jeannot Krecké
|
—
|
—
|
—
|
—
|
78
|
|
|
Michel Wurth
|
177
|
188
|
181
|
181
|
186
|
|
|
Karel de Gucht
|
184
|
196
|
189
|
208
|
209
|
|
|
Etienne Schneider
|
200
|
196
|
189
|
197
|
118
|
|
|
Clarissa Lins
|
195
|
207
|
200
|
116
|
—
|
|
|
Patricia Barbizet
|
185
|
130
|
—
|
—
|
—
|
|
|
Total
|
4,813
|
4,872
|
4,875
|
5,267
|
4,341
|
|
1.
Remuneration for non-executive Directors with respect to 2024 will be paid in 2025 subject to Board of Directors proposal and to the shareholder approval at the annual
general meeting to be held on May 6, 2025. Remuneration for non-executive Directors with respect to 2023, 2022, 2021 and 2020 was paid in 2024, 2023, 2022 and
2021, respectively, following the shareholder approval at the annual general meetings held on April 30, 2024, May 2, 2023, May 4, 2022 and June 8, 2021, respectively.
Slight differences between the years are possible, due to foreign currency effects.
137
|
Management report
|
Except for the Executive Chairman and the CEO, members of the Board of Directors have not received any remuneration from any
subsidiary of the Group in 2024.
The annual base salary for the last five financial years on a full-time equivalent basis of employees of ArcelorMittal S.A. was as follows:
|
(Amounts in $ thousands)
|
2024
|
2023
|
2022
1
|
2021
1
|
2020
1
|
|
Average Remuneration
|
550
|
502
|
446
|
446
|
412
|
1.
The annual remuneration is calculated for approximately 14 employees with a labor contract with ArcelorMittal S.A (not including any employees employed by other
entities within the Group).
ArcelorMittal has performed a benchmarking on remuneration
with its selected peers and fixed the remuneration of the
employees and Directors based on the outcome of that
exercise.
The policy of the Company is not to grant any share-based
remuneration to members of the Board of Directors who are
not executives of the Company. As of December 31, 2024,
ArcelorMittal did not have any loans or advances outstanding
to members of its Board of Directors and ArcelorMittal had not
given any guarantees in favor of any member of its Board of
Directors. None of the members of the Board of Directors,
other than the CEO, benefit from an ArcelorMittal pension plan.
Short-term incentives paid to executive directors were as
follows for the last five financial years:
|
Short-term Incentives
|
||||||
|
2024
|
2023
|
2022
|
2021
|
2020
|
||
|
Lakshmi N. Mittal
|
—
|
—
|
3,053
|
2,908
|
—
|
|
|
Aditya Mittal
|
—
|
—
|
3,335
|
2,226
|
935
|
|
The following tables provide a summary of the PSUs granted
(long-term incentives) to the executive directors on the Board
of Directors, as of December 31, 2024. There were no
outstanding stock options as of December 31, 2024.
|
|
PSUs granted in
2024
|
PSUs granted in
2023
|
PSUs granted in
2022
|
PSUs granted in
2021
|
PSUs granted in
2020
|
|
Lakshmi N. Mittal
|
112,635
|
67,857
|
67,662
|
52,166
|
77,372
|
|
Aditya Mittal
|
129,221
|
74,116
|
73,902
|
56,977
|
71,050
|
|
Term (in years)
|
3
|
3
|
3
|
3
|
3
|
|
Vesting date
1
|
January 1, 2028
|
January 1, 2027
|
January 1, 2026
|
January 1, 2025
|
January 1, 2024
|
1.
See “Management and employees—Compensation—Remuneration—ArcelorMittal Equity Incentive Plan", for vesting conditions.
138
|
Management report
|
Remuneration at a glance - senior management
The following table provides a brief overview of the Company’s remuneration policy for senior management. Additional information is
provided below.
|
ArcelorMittal's Remuneration Policy
|
||||
|
Remuneration
|
Period
|
Strategy
|
Characteristic
|
|
|
Salary
|
2024
|
Recruitment and retention
|
l
|
Reviewed annually by the ARCG Committee considering market data
|
|
l
|
Increases based on the Company performance and individual
performance
|
|||
|
STI
|
2024
|
Delivery of strategic priorities
and financial success
|
l
|
Maximum STI award of 360% of base salary for the Executive Chairman,
and the CEO and in general 240% of base salary for other
Executive Officers (depending on the region)
|
|
l
|
100% STI paid in cash
|
|||
|
l
|
ArcelorMittal's first priority Health and Safety is part of the STI
|
|||
|
l
|
Over performance towards competition
|
|||
|
LTIP
|
2024-2026
|
Encourages long term
shareholder return
|
l
|
PSUs granted with a face value of 180% of base salary for the Executive
Chairman and CEO
PSUs / RSUs granted with a face value of 110%-180% of base salary as
a guideline for other Executive Officers depending on the region
|
|
l
|
Shares vest after a three-year performance period for PSUs and after a
three-year period for RSUs
|
|||
|
l
|
Performance related vesting and/or employment related vesting
|
|||
|
Key Performance Metrics from 2024
|
|||
|
Metrics
|
Scheme
|
Rationale
|
|
|
EBITDA
|
STI
|
l
|
Demonstrates growth and operational performance of the underlying businesses
|
|
FCF
|
STI
|
||
|
Gap to competition
|
STI
|
l
|
Outperform peers
|
|
Health & Safety
|
STI / LTIP
|
l
|
Employee health and safety is a core value for the Company
|
|
ESG
|
LTIP
|
l
|
Improve health & safety outcome, achieve decarbonization and diversity & inclusion targets
|
|
EPS
|
LTIP
|
l
|
Links reward to delivery of underlying equity returns to shareholders
|
|
ROCE
|
LTIP
|
l
|
Critical factor for long-term success and sustainability of the Company
|
|
TSR
|
LTIP
|
l
|
Creates a direct link between executive pay and shareholder value
|
|
l
|
Comparison with a peer group of companies
|
||
Remuneration at a glance - 2024 Pay outcomes
The following graphics present in thousands of U.S. dollar the compensation paid to the Executive Chairman (CEO until February 11,
2021) in 2024, 2023, 2022, 2021 and 2020 and to the CEO (President and CFO until February 11, 2021) in 2024, 2023, 2022 and 2021.
Amounts presented for the CFO and other Executive Officers relate to the former President and CFO (Aditya Mittal) and other
Executive Officers until Februar
y 11, 20
21 and to the CFO and other Executive Officers thereafter. Information with respect to total
remuneration paid is provided under “—Remuneration—2024 Total remuneration” below.
139
|
Management report
|
140
|
Management report
|
2023 short-term incentives paid in 2024
|
Business Units
|
Executive
|
Realization as % of business target
|
|
Executive Office
|
Lakshmi N. Mittal
Aditya Mittal
|
Executive office renounced their short-term
incentive
|
|
Mining
|
Stefan Buys
|
85%
|
|
North America
|
John Brett
|
128%
|
|
Corporate*
|
Genuino Christino
|
128%
|
|
Corporate*
|
Bradley Davey
|
128%
|
|
Corporate*
|
Stephanie Werner-Dietz
|
128%
|
|
CIS**
|
Vijay Goyal
|
64% → 0%
|
|
AMNS India
|
Dilip Oommen
|
140%
|
|
Europe
|
Geert van Poelvoorde
|
105%
|
|
Long Carbon South America
|
Jefferson de Paula
|
150%
|
Note: Individual performance not included in the percent of realization.
*Health & Safety part of the bonus was nil due to the number of fatalities.
**Due to the tragic accident in Kazakhstan in October 2023, the performance bonus was not paid out to the
CEO CIS.
Long-term incentives vesting in 2024
Executive office
In 2024, the following long-term incentives vested:
|
Vehicle
|
Date of vesting
|
Date of grant
|
Number of PSUs
granted to
Executive office
|
Number of shares
acquired by
Executive office
|
|
PSUs
|
January 1, 2024
|
December 14, 2020
|
148,422
|
111,317
|
CFO and Other Executive Officers
In 2024, the following long-term incentives vested:
|
Vehicle
|
Date of vesting
|
Date of grant
|
Number of PSUs and
RSUs granted to CFO
and other Executive
officers
|
Number of shares
acquired by CFO and
other Executive
officers
|
|
PSUs
|
January 1, 2024
|
December 14, 2020
|
79,100
|
61,544
|
|
RSU
|
December 16, 2024
|
December 16, 2021
|
32,100
|
32,100
|
Remuneration
Remuneration strategy
The ARCG Committee assists the Board of Directors to
maintain a formal and transparent procedure for setting policy
on senior management's remuneration and to determine an
appropriate remuneration package for senior management.
The ARCG Committee should ensure that remuneration
arrangements support the strategic aims of the business and
enable the recruitment, motivation and retention of senior
executives while complying with applicable rules and
regulations.
Board oversight
To this end, the Board of Directors has established the ARCG
Committee to assist it in making decisions affecting employee
remuneration. All members of the ARCG Committee are
required to be independent under the Company’s corporate
governance guidelines, the New York Stock Exchange
("NYSE") standards and the 10 Principles of Corporate
Governance of the Luxembourg Stock Exchange.
141
|
Management report
|
The members are appointed by the Board of Directors each
year after the annual general meeting of shareholders. The
members have relevant expertise or experience relating to the
purposes of the ARCG Committee. The ARCG Committee
makes decisions by a simple majority with no member having a
casting vote and is chaired by Ms. Karyn
Ovelmen
, Lead
Independent Director.
Appointments, remuneration and corporate governance
committee
One of the tasks of the ARCG Committee is to assist the Board
of Directors by providing recommendations specifically related
to remuneration and compensation. This includes:
•
reviewing and approving corporate and personal
goals and objectives relevant to the compensation of
the members of the Executive Office, Executive
Officers and senior management as deemed
appropriate by the committee, and evaluating their
performance in light of these goals and objectives.
•
making recommendations to the Board of Directors
regarding
trends in Board remuneration and incentive
compensation plans.
•
Recommending the Company’s framework of
remuneration for the members of the Executive Office,
Executive Officers and other senior executives as
determined by the committee. In making these
recommendations, the committee may consider
factors that it deems necessary, including a member’s
total cost of employment (factoring in equity/long term
incentives, any perquisites and benefits in kind and
pension contributions).
•
Approving a report on executive remuneration to be
included in the company's annual report.
•
Reviewing the analysis of proxy advisory firms in the
context of corporate governance compensation.
Individual remuneration is discussed by the ARCG Committee
without the person concerned being present. The ARCG
Committee Chair presents her decisions and findings to the
Board of Directors after each ARCG Committee meeting.
See also "Corporate governance—Board of Directors
committees"' for further details and additional responsibilities of
the ARCG Committee.
Remuneration policy
The ARCG Committee has set policies applied to senior
management on base salary, short-term incentives and long-
term incentives. According to the Shareholders Right Directive
II, which was transposed into Luxembourg law in August 1,
2019,
the remuneration policies must be approved at the
Annual General Meeting of shareholders at least every 4 years
and whenever there is a material change. The Company
submits the remuneration report for the prior year for
shareholder approval at each AGM.
Scope
ArcelorMittal’s remuneration philosophy and framework apply
to the following groups of senior management:
•
the Executive Chairman and the CEO; and
•
the CFO and other Executive Officers.
The remuneration philosophy and governing principles also
apply, with certain limitations, to a wider group of employees
including Executive Vice Presidents, Vice Presidents, General
Managers and Managers.
Remuneration philosophy
ArcelorMittal’s remuneration philosophy for its senior
management is based on the following principles:
•
provide total remuneration competitive with executive
remuneration levels of peers of similar size, scope
and industry:
–
Korn Ferry (KF) and WillisTowersWatson (WTW)
provide benchmarking services to ArcelorMittal for
all Management Committee members, an average
between KF and WTW data is performed;
–
For the Steel division: Large industry - industrial
segment including metals, chemicals, mining,
transport, energy & utilities, upper revenues range;
–
For the Mining division: Large companies with a
significant mining divisions or companies similar to
ArcelorMittal Mining division;
–
Data are linked to each local market.
•
encourage and reward performance that will lead to
long-term enhancement of shareholder value; and
•
promote internal pay equity by providing base pay and
total remuneration levels that reflect the role, job size
and responsibility as well as the performance and
effectiveness of the individual.
Remuneration framework
The ARCG Committee develops proposals for senior
management remuneration annually for the Board of Directors'
consideration. Such proposals include the following
components:
•
fixed annual salary;
•
short-term incentives (i.e., performance-based
bonus); and
•
long-term incentives (i.e., RSUs and/or PSUs).
142
|
Management report
|
The Company does not have any deferred compensation plans
for senior management, including the Executive Chairman and
CEO.
The following table provides an overview of the remuneration policy applied by the ARCG:
|
Remuneration component
and link to strategy
|
Operational and performance framework
|
Opportunity
|
|
Fixed annual salary
Competitive base salary to
attract and retain high-
quality and experienced
senior executives
|
* Base salary levels are reviewed annually with effect from April 1
(except promotion) compared to the market to ensure that ArcelorMittal
remains competitive with market median base pay levels
* Reviews are based on market information obtained but not led by
benchmarking to comparable roles, changes in responsibility and
general economic conditions
|
The ARCG does not set a maximum salary,
instead when determining any salary
increases it takes into account a number of
reference points including salary increases
across the Company
|
|
Benefits
Competitive level to ensure
coverage of the executives
|
* May include costs of health insurance, death and disability insurances,
company car, tax return preparation, etc.
* Relocation benefits may be provided where a change of location is
made at Company’s request
|
The cost to the Company of providing benefits
can change from year to year. The level of
benefit provided is intended to remain
competitive
|
|
Pension
Competitive level of post-
employment benefit to
attract and retain executives
|
* Local benchmark of pension contributions for comparable roles
|
|
|
Short term incentives (STI)
Motivate the senior
executives to achieve
stretch performance on
strategic priorities
|
* Scorecard is set at the commencement of each financial year
* Measures and relative weights are chosen by the ARCG Committee to
drive overall performance for the coming year
* STI calculations for each executive reflect the performance of
ArcelorMittal and /or the performance of the relevant business units, the
achievement of specific objectives of the department and the individual
executive’s overall performance
* No STI is paid for a business performance below threshold 80% for
each criteria; 100% STI payout for business performance achieved at
100% for each criteria; 150% STI payout for business performance
achieved at 120% ; 200% STI payout for business performance achieve
at 140% or above for each criteria
|
Range for Executive Chairman and CEO: 0 to
360% with a target at 120% of base salary
Range for CFO and Executive Officers: 0 to
240% with a target at 80% of base salary in
general (will depend on the region)
|
|
LTIP
Sustain shareholder wealth
creation in excess of
performance of a peer
group and incentivize
executives to achieve
strategy
|
Executive Office LTIP
* The vesting is subject to a relative TSR (Total Shareholder Return) and
to a relative EPS compared to a peer group and to ESG targets over a
three year- period
*The peer group is determined by the ARCG Committee
* No vesting will occur below the weighted average of the peer group or
the target for ESG
* Performance is determined by the ARCG Committee
CFO and Executive Officers LTIP
*The vesting is subject to two or three measures depending on the
business units or group, Gap to competition, TSR vs. weighted average
of the peer group and ESG
*Vesting will occur if the performance is reached
*Performance is determined by the ARCG Committee
|
Maximum value at grant:
180% of base salary for Executive Chairman
and CEO
Guideline: 110%-180% of base salary for CFO
and Executive Officers depending on region
|
Remuneration mix
The total remuneration target of the Executive Chairman, CEO
and CFO is structured to attract and retain executives; the
amount of the remuneration received is dependent on the
achievement of superior business and individual performance
and on generating sustained shareholder value from relative
performance.
The following remuneration charts, which illustrate the various
elements of the Executive Chairman, CEO, CFO and the other
Executive Officers' compensation, show the amounts for 2024
as a percentage of base salary.
For each of the charts below,
the columns on the left, middle and on the right, respectively,
reflect the breakdown of compensation if targets are not met,
met and exceeded.
143
|
Management report
|
Note: no
pension
contribution
144
|
Management report
|
Note: Other benefits, as shown above, do not include international mobility incentives that may be provided.
2024 Total remuneration
The total remuneration paid in 2024 to members of
ArcelorMittal’s senior management listed in “Management and
employees—Directors and senior management” (including Mr.
Lakshmi N. Mittal in his capacity as Executive Chairman and
Mr. Aditya Mittal as CEO) was $11.6 million in base salary and
other benefits paid in cash (such as health, other insurances,
lunch allowances, financial services, gasoline and car
allowance) and $13 million in short-term performance-related
variable remuneration consisting of a short-term incentive
linked to the Company’s 2023 results and retention bonus.
During 2024, approximately $1.
4
million was accrued by
ArcelorMittal to provide
pension
benefits to
senior management
(other than Mr. Lakshmi N. Mittal).
No loans or advances to ArcelorMittal’s senior management
were made during 2024, and no such loans or advances were
outstanding as of December 31, 2024.
The following table shows the remuneration received by the
Executive Chairman, CEO, CFO and the other Executive
Officers as determined by the ARCG Committee in relation to
the five most recent financial years including all remuneration
components:
145
|
Management report
|
|
Executive Chairman
7
|
CEO
6
|
Chief Financial Officer and Executive
Officers
5,6,7
|
|||||||||||||
|
(Amounts in $ thousands
except for Long-term
incentives)
|
2024
|
2023
|
2022
|
2021
|
2020
|
2024
|
2023
|
2022
|
2021
|
2024
|
2023
|
2022
|
2021
|
2020
|
|
|
Base salary
1
|
1,580
|
1,536
|
1,529
|
1,700
|
1,374
|
1,791
|
1,678
|
1,670
|
1,783
|
7,211
|
6,395
|
5,790
|
5,056
|
2,970
|
|
|
Pension benefits
|
—
|
—
|
—
|
—
|
—
|
179
|
168
|
167
|
178
|
1,235
|
1,041
|
1,066
|
1,348
|
555
|
|
|
Other benefits
2
|
90
|
80
|
72
|
66
|
45
|
43
|
44
|
39
|
38
|
865
|
674
|
599
|
237
|
144
|
|
|
Short-term incentives
3
|
—
|
—
|
3,053
|
2,908
|
—
|
—
|
—
|
3,335
|
2,226
|
12,975
|
8,773
|
9,370
|
7,158
|
2,169
|
|
|
Long-term
incentives
|
- fair value in $
thousands
4
|
2,518
|
1,391
|
1,520
|
1,419
|
1,407
|
2,888
|
1,519
|
1,661
|
1,550
|
9,001
|
6,544
|
3,838
|
4,396
|
1,834
|
|
- number of
share units
|
112,635
|
67,857
|
67,662
|
52,166
|
77,372
|
129,221
|
74,116
|
73,902
|
56,977
|
372,500
|
287,900
|
155,400
|
146,600
|
90,069
|
|
1.
After the salary decrease applied in 2020, the base salaries of the CEO and President and Chief Financial Officer were set back to the original amounts in 2021. In 2024, a
salary increase of 4.4% including the promotions..
2.
Other benefits comprise benefits paid in cash such as lunch allowances, financial services, gasoline and car allowances. Health insurance and other insurances are also
included.
3.
Short-term incentives are either performance-based or retention bonus and are fully paid in cash. The short-term incentive for a given year relates to the Company’s results
in the previous year.
4.
Fair value determined at the grant date is recorded as an expense using the straight line method over the vesting period and adjusted for the effect of non-market based
vesting conditions.
5.
Amounts presented for 2021 and 2020 reflect the compensation as President and Chief Financial Officer until February 11, 2021 and as CEO thereafter.
6.
Amounts presented reflect the compensation as CEO until February 11, 2021 and as Executive Chairman thereafter.
7.
Brian Aranha was included until March 31, 2021. Simon Wandke was included until September 30, 2021. New executive officers were included as of their respective
nomination date.
Short-term incentives
Targets associated with ArcelorMittal’s 2024 Annual
Performance
Bonus Plan were aligned with the Companies’
strategic objectives of improving health and safety performance
and overall business performance and competitiveness.
For the Executive Chairman and the CEO, the 2024 annual
performance bonus formula
is based on the achievement of the
following performance targets:
•
EBITDA targets at Group level: 40% (acts as circuit
breaker for financial measures EBITDA and FCF);
•
FCF targets at Group level: 25%;
•
Gap to competition targets at Group level: 20%; and
•
Health and safety performance targets at Group level:
15%. In order to help focus attention, energy and
resources on detecting and eliminating the causes of
serious injury or fatality precursors, the Company has
moved to a target of potential severe injury or fatality.
To emphasize this priority, the fatality frequency rate
acts as a circuit breaker for the Health & Safety
component. The circuit breaker is set at a fatality
frequency rate of nil.
For the Executive Chairman and CEO, 100%
achievement of
the agreed performance targets results in an annual
performance bonus which equals 120% of base salary.
For the CFO and other Executive Officers,
the 2024 annual
perform
ance bonus formula was tailored
for their respective
positions and is generally based on the following performance
targets:
•
EBITDA targets at Group, segment or Business unit
level (acts as circuit breaker for financial measures
EBITDA and FCF);
•
FCF targets at Group, segment or Business unit level;
•
Gap to competition targets at Group level, segment or
Business unit level;
•
Health and safety performance targets at Group,
Segment or Business unit level (fatalities act as circuit
breaker for this component).The circuit breaker is set
at a facility frequency rate of 0.012 for 2024, 0.006 for
2025 and nil for
2026
.
For the CFO and other Executive Officers, 100% achievement
of the agreed performance targets results in an annual
performance bonus which equals 80% of base salary in
general (depends on the region).
For the calculation of the annual performance bonus, the
achievement level of every performance target is calculated
separately, and these are added up.
Individual performance and assessment ratings define the
individual annual performance bonus multiplier that will be
applied to the annual performance bonus calculated based on
actual performance against the performance measures. Those
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individuals who consistently perform at expected levels will
have an individual multiplier of 1. For outstanding performers,
an individual multiplier of up to 1.5 may cause the annual
performance bonus pay-out to be higher than 200% of the
target annual performance bonus, up to 360% of the target
annual performance bonus being the absolute maximum for
the Executive Chairman and the CEO. Similarly, a reduction
factor will be applied for those at the lower end.
In exceptional circumstances, the ARCG Committee can
exercise discretion in the final determination of the annual
performance bonus.
The achievement level of performance for the annual
performance bonus for the Executive Chairman, the CEO, the
CFO and the other Executive Officers is summarized as
follows:
|
Functional level
|
Target achievement threshold
@ 80%
|
Target achievement
@ 100%
|
Target achievement
@ 120%
|
Target achievement ≥ ceiling
@ 140%
|
|||
|
Executive Chairman and CEO
|
60% of base pay
|
120% of base pay
|
180% of base pay
|
240% of base pay
|
|||
|
CFO and Executive Officers
|
40% of base pay
|
80% of base pay
|
120% of base pay
|
160% of base pay
|
ArcelorMittal Equity Incentive Plan
ArcelorMittal operates a long-term incentive plan ("the
ArcelorMittal Equity Incentive Plan") to incentivize shareholder
wealth creation in excess of performance of a peer group and
incentivize executives to achieve strategy. The ArcelorMittal
Equity Incentive Plan is intended to align the interests of the
Company’s shareholders and eligible employees by allowing
them to participate in the success of the Company. The
ArcelorMittal Equity Incentive Plan provides for the grant of
RSUs and PSUs to eligible employees of the Company
(including the Executive Officers) and is designed to incentivize
employees, improve the Company’s long-term performance
and retain key employees.
The maximum number of PSUs and RSUs available for grant
during any given year is subject to the prior approval of the
Company’s shareholders at the annual general meeting. The
2020, 2021, 2022, 2023 and 2024 Caps for the number of
PSUs/RSUs that may be allocated to the Executive Office and
other retention and performance based grants below the
Executive Office level, were approved at the annual general
meetings on June 8, 2021, May 4, 2022 ,on May 2, 2023 and
on April 30, 2024, respectively, at a maximum of 3,500,000
shares, 3,500,000 shares, 3,500,000 shares and 5,500,000
shares,
respectively
.
RSUs granted under the ArcelorMittal Equity Incentive Plan are
designed to provide a retention incentive to beneficiaries.
RSUs are subject to “cliff vesting” after
3 years with 100% of
t
he grant vesting on the third anniversary of the grant
contingent upon the continued active employment of the
beneficiary within the Company.
Awards in connection with PSUs are subject to the fulfillment of
performance criteria such as ROCE, TSR, EPS and gap to
competition (until 2022). Since 2021, the performance criteria
for the PSUs for the Executive Office and Executive Officers
include an ESG criteria comprised of a health & safety, a
climate action and a
diversity & inclusion ("D&I") targe
t. For
health & safety, the target is to halve the fatality frequency rate
versus a defined baseline (the baseline is the adjusted average
frequency rate over 5 years before the grant). For D&I, the
target up to this point has been to reduce the gap between the
Company's 2030 target of having 25% women in management
and 2020 baseline. Good progress has been made in
strengthening the number of women in leadership, and given
the critical importance of rapidly improving safety results
across the Company, ArcelorMittal will give consideration to
increasing the safety component. For climate, the CO
2
emission target has been set to be reached by the end of the
vesting period.
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On December 5, 2024, the Company issued the 2024 grant whose conditions were as follows:
|
Executive Office
|
Executive Officers
|
||||||||||||
|
2024
Grant
|
l
|
PSUs with a three year performance period
|
l
|
PSUs with a three year performance period
|
|||||||||
|
l
|
Value at grant 180% of base salary for the
Executive Chairman and the CEO
|
||||||||||||
|
l
|
Vesting conditions:
|
l
|
Vesting conditions:
|
||||||||||
|
Target
|
Stretch
|
Ceiling
|
Threshold
|
Target
|
Stretch
|
Ceiling
|
|||||||
|
TSR vs. peer group
(50%) / EPS vs. peer
group (20%)
|
100% vs.
weighted
average
|
120% vs.
weighted
average
|
≥140% vs.
weighted
average
|
TSR vs. peer group
(40%)
|
80% rolling
average
|
100% rolling
average
|
120%
rolling
average
|
≥140%
rolling
average
|
|||||
|
Vesting percentage
|
100%
|
150%
|
200%
|
Vesting percentage
|
50%
|
100%
|
150%
|
200%
|
|||||
|
ROCE (40%)
|
2/3 of target
|
100% of
target
|
4/3 of
target
|
155% of
target
|
|||||||||
|
ESG (30%): H&S 10%,
Climate action 10%
and D&I: 10%
|
100% of
target
|
120% of
target
|
≥140% of
target
|
Vesting percentage
|
50%
|
100%
|
150%
|
200%
|
|||||
|
Vesting percentage
|
100%
|
150%
|
200%
|
ESG (20%): H&S
10%, Climate action
5% and D&I 5%
|
80%
weighted
average
|
100% of
target
|
120% of
target
|
140% of
target
|
|||||
|
Vesting percentage
|
50%
|
100%
|
150%
|
200%
|
|||||||||
|
l
|
RSUs with a three year vesting period
|
||||||||||||
See note 8.3 to the consolidated financial statements for a
summary of outstanding plans as of December 31, 2024 in
addition to the 2024 grant and for further details.
Other benefits
In addition to the remuneration described above, other benefits
may be provided to senior management and, in certain cases,
other employees. These other benefits can include insurance,
housing (in cases of international transfers), car allowances
and tax assistance.
SOX 304 and clawback policy
Under Section 304 of the Sarbanes-Oxley Act, the SEC may
seek to recover remuneration from the CEO and CFO of the
Company in the event that it is required to restate accounting
information due to any material misstatement thereof or as a
result of misconduct in respect of a financial reporting
requirement under the U.S. securities laws (the “SOX
Clawback”).
Under the SOX Clawback, the CEO and the CFO may have to
reimburse ArcelorMittal for any short-term incentive or other
incentive-based or equity-based remuneration received during
the 12-month period following the first public issuance or filing
with the SEC (whichever occurs first) of the relevant filing, and
any profits realized from the sale of ArcelorMittal securities
during that 12-month period.
In October 2022, the SEC adopted final rules implementing the
Dodd-Frank requirement for issuers to recover incentive-based
compensation erroneously paid to current and former executive
officers due to an accounting restatement. These clawback
rules required listing exchanges, such as the NYSE, to adopt
clawback standards as from the fourth quarter of 2023, with
issuers required to implement and disclose “no fault” clawback
policies that meet strict recovery standards for restatements,
within 60 days thereafter.
The Board of Directors, through its ARCG Committee, adopted
its own clawback policy in 2012, which was updated in 2023
(the "Clawback Policy"), to reflect the Company’s structural
changes and comply with the new rules.
The Clawback Policy applies to all Executive Officers and
covers cash short-term incentives and any other incentive-
based or equity-based remuneration, as well as profits from the
sale of the Company’s securities ("Covered Compensation")
received during the three completed fiscal years of the
Company immediately preceding a the Restatement Date (as
defined in the policy) and any transition period (that results
from a change in the Company’s fiscal year) of less than nine
months within or immediately following those three completed
fiscal years. Compensation is deemed to be received in the
Company’s fiscal period during which the Financial Reporting
Measure specified in the Incentive-based Compensation award
is attained (capitalized terms as defined in the policy).
Under the Clawback Policy, ArcelorMittal will recover
reasonably promptly erroneously paid Covered Compensation
in the event it is required to prepare an accounting restatement
due to the material noncompliance of ArcelorMittal with any
financial reporting requirement under the U.S. securities laws,
including any required accounting restatement to correct an
error in a previously issued financial statement that is material
to the previously issued financial statement, or that would
result in a material misstatement if the error were corrected in
the current period or left uncorrected in the current period.
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Employees
As of December 31, 2024, ArcelorMittal employed approximately
125,416
full time equivalents ("FTE") employees directly, as well
as a large number of contractors. The Company recruits, hires,
promotes and retains employees based on merit and
demonstrated skills.
The table below sets forth the number of FTE employees
respectively by segment as of the end of each of the past three
years.
|
As of December 31,
|
|||
|
Segment
|
2024
|
2023
|
2022
|
|
North America
|
13,861
|
14,418
|
14,270
|
|
Brazil
|
22,624
|
22,042
|
19,644
|
|
Europe
|
48,544
|
49,959
|
49,318
|
|
Sustainable Solutions
|
12,843
|
12,194
|
11,988
|
|
Mining
|
4,758
|
4,473
|
4,626
|
|
Others
1
|
22,786
|
23,670
|
54,506
|
|
Total
|
125,416
|
126,756
|
154,352
|
1. ArcelorMittal Temirtau is included until December 31,
2022
The people strategy
To meet the evolving needs of its people and address the
challenges of a shifting skills economy, technological
advancements, and generational transitions, ArcelorMittal
remains committed to delivering its people strategy, launched in
2022. The strategy is built around ArcelorMittal's fundamental
purpose to create smarter steels for people and the planet. This
strategy seeks to boost talent and continuously foster a safety-
first, people-driven culture that ensures sustainable performance
and enables the Company to deliver on its purpose.
Employee development
Attracting, developing and retaining the right people continues to
be a strategic priority for ArcelorMittal in sustaining a high-
performing organization.
With strong competition for the best talent, ArcelorMittal is
committed to ensuring the Company is an aspirational
workplace—one where employees feel safe, respected and
valued. This also means building a culture that constantly keeps
employees engaged, motivated, and eager to learn and excel.
Employee development, which includes succession planning
and the development of early career talents plays a crucial role
in building a high-performing organization. The Company strives
to provide employees a clear career pathway, supported by
continuous training and ongoing initiatives to develop both
technical and behavioral skills. A dedicated process helps
identify high potential employees ("HiPos") and manage the
succession of key roles.
In 2024, the Company intensified its efforts to develop
employees' skills and accelerate the readiness of its HiPos to
take on increased responsibilities. A strong focus was placed on
having the right people in the right roles at the right time,
strengthening key succession plans, and preparing future
leaders. Efforts also included anticipating and filling vacancies;
building a robust and qualified leadership pipeline; encouraging
individual and sustained performance; and fostering talent
retention through recognition, empowerment, and meaningful
work.
To further support career growth, ArcelorMittal enhanced its
communications initiatives to increase the visibility of global
career opportunities, ensuring employees are aware of potential
paths for advancement within the organization.
The Company also took steps to enhance the quality of its
succession planning, ensuring stronger alignment between
potential successors and their career aspirations.
In 2024, the Company experienced a significant increase in
virtual learning engagement at ArcelorMittal University ("AMU"),
further expanding its global community. Employees a
cross the
Group invested an average of 5.1 hours each to online learning
with more than 149,000 active learners (a 48% increase year-
on-year) logging over 760,000 hours (a 27% increase year-on-
year).
The Company continued offering world-class leadership
programs through AMU.
Delivered in a blended format—
combining face-to-face (where possible) with digital sessions—
these programs support the development of talent and future
leaders. In 2024, 16 leadership programs were launched
engaging 462 employees.
A new development program called 'Thrive' was introduced in
North America, Brazil, and Europe to help employees accelerate
their career growth. The program matches individuals with
suitable roles and career opportunities based on their
preferences, skills and qualifications.
ArcelorMittal's Group Mentoring Program also remained a vital
resource, offering employees an opportunity to engage in a
structured mentoring relationship with an experienced leader. In
2024, more than 1
,900 mentorship hours were invested as part
of the program with
426 active mentor-mentee pairs a
s of
December 31,
2024
.
In addition, the Company continued refining its employee
systems landscape, improving processes in recruitment,
performance, career development, learning, and compensation.
These enhancements provide a stronger infrastructure for
analyzing data and identifying areas for continuous
improvement, reinforcing ArcelorMittal's commitment to
employee growth and engagement.
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Speak Up +, the global employee survey
For the past few years, ArcelorMittal's Speak Up + survey
has been the Group’s flagship employee engagement tool. It
gathers insights from professionals and leadership on their
experience working at ArcelorMittal, what the Company does
well and areas for improvement.
In 2024, ArcelorMittal continued to listen to employees'
voices through these surveys, which serve as the ongoing
vehicle to help the Company’s leaders stay attuned to the
organization in a rapidly changing environment. The goal is
to track engagement levels across the Group, understand
employees' aspirations, and empower leaders to address
potential issues proactively.
The survey is conducted twice a year. The outcomes from
each Speak Up + survey are compared to internal
benchmarks over time and external industry peers. This
enables leaders to identify strengths, detect risks—such as
attrition— and take actions to enhance employee
engagement.
Based on survey outcomes, concrete actions are
continuously developed and implemented to address
employee concerns and drive engagement.
Equal opportunity and non-discrimination
ArcelorMittal values bringing together fresh perspectives and
experiences to the business as part of its ambition to be an
employer of choice. The Company is present in over 60
countries and aims to have employees which represent all
differences. In 2022, the Company defined a clear roadmap
to ensure equal opportunity and non-discrimination.
Subsequently, a strategic framework was launched in 2024,
which includes best practices as a reference guide for all
segments and plants to achieve equality for all employees.
The Company continuously reviews and benchmarks its policies
and HR practices to build an inclusive and merit based culture
that empowers all talents. This is designed to ensure that all
qualified candidates have equal opportunities ultimately based
on individual merit.
In 2024, women held 19% of management positions across
the Group based on merit, compared to 17.3% in 2023.
As of December 31, 2024, women held
four
of the nine
positions on the Board of Directors.
Collective Labor Agreements ("CLAs")
In multiple regions globally, ArcelorMittal employees are
represented by trade unions and the Company actively
engages in collective bargaining agreements with employee
organizations at specific locations. The description below
provides an overview of the current status of specific
agreement and relationships.
The Company is committed to open, respectful and transparent
social dialogue at all of its operations, to maintain strong
employee relations, and to provide a safe, healthy and quality
working lives for all its workers.
In the current inflationary environment, the Company
understands that salary increases for workers is a question of
high sensitivity. ArcelorMittal is respecting its commitment to
social dialogue and all entities have regular discussions and
negotiations on salary policy with their respective unions.
The Joint Global Health and Safety Agreement between the
Company and IndustriALL global trade union, signed in 2008,
remained in effect in 2024. This agreement recognizes the vital
role played by trade unions in improving health and safety. It
sets out minimum standards for every site where the Company
operates with the objective of achieving world-class
performance. As a result of this agreement, the Joint Global
H&S Committee, composed of 16 representatives in 2024 (12 in
2023) of management and the unions was created to
identify
areas for improvement and harmonize safety performance
across the Group. The Joint Global H&S Committee only deals
with issues related to H&S and does not act as a negotiation
committee on behalf of unions or management.
One of its
primary priorities is centered around overseeing deployment and
monitoring the compliance of local joint H&S panels. This
involves developing guidelines to progress and training
programs,
conducting site visits to assess implementation and
offering suggestions for improvement. Additionally, the Joint
Global H&S Committee provides recommendations on
transversal and global topics to enhance overall safety
measures.
In 2024, one physical meeting was organized at the Group level
to discuss transversal specific topics with regard to H&S. One of
the main topics of this meeting was the collective review and the
update of the committee charter. In addition, other safety
training and coaching programs, such as "Take Care" Trainings
as well as a dss+ lead “Area of Transformation” program
continued to be rolled out in 2024 in order to support the
“Journey to Zero” program aimed at reducing the amount of
injuries and fatalities in the Company to zero.
See “Business
overview—Sustainable development—Health and Safety".
In 2024, several entities and countries engaged in entering or
renewal of CLAs.
In North America, employees at various sites continue to work
under collective agreements that remain valid.
In May 2024, the
Company's steel plant in Lazaro Cardenas,
Mexico and mine
located in Tenecia La Mira in the Mexican state of Michoacán
was impacted by an illegal blockade by a group of workers due
to their dissatisfaction with the distribution of profit sharing by
the Company. Ultimately, the Company approved a new
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|
settlement with unions with an agreement to end the strike in
July 2024.
In South America, inflation trends varied across different
countries. Brazil experienced a deceleration in inflation, with
collective bargaining agreements generally granting adjustments
equivalent to the inflation rate. Argentina has been experiencing
a high inflation rate since several years. The situation remained
the same in 2024 and the negotiations for salary increase are
still in progress.
In Europe, four meetings were conducted in 2024 to inform the
European Works Council ("EWC") representatives about the
H&S and business performance and outlook regarding the
Company's European operations. Throughout the year, three
meetings with the Select Committee were held, alongside a
Plenary Assembly in December 2024. Negotiations aiming to
revise the EWC agreement are expected to finalize
by the end
of the first quarter of 2025.
In France, a one-year salary agreement for 2024 was signed in
December 2023, covering most legal entities. Negotiations for
2025 were conducted at most of the French sites at the end of
2024 and resulted in the payment of a premium.
ArcelorMittal
Méditerranée announced in July 2024 that it would continue to
operate with only one of the two blast furnaces in the
foreseeable future due to weak market conditions.
Discussions
with employee representatives in order to manage workforce
adaptation started in 2024 and are still ongoing
. All employees
are covered by collective labor agreements.
In Luxembourg, social elections were held on March 12, 2024
which led to the election of new staff representatives and
deputies, with a new staff delegation replacing the previous one.
In 2024, Germany continued to experience high energy prices,
impacting costs and market conditions negatively, despite low
inflation. A one-off payment was made to all employees under
previous collective bargaining agreements.
In 2024, at ArcelorMittal Poland, a successful negotiation of the
CLA
was achieved with trade unions. The management also
invited trade union representatives to the Supervisory Board,
promoting transparency and inclusive decision-making. About
99% of employees are covered by the CLA, with only top
executives excluded.
In Spain, a temporary layoff plan was agreed upon in late 2023
due to market conditions and extended through 2024. A
framework agreement for labor relations was signed with most
unions in May 2023, and all local CLAs were finalized by
mid-2024, covering about 80% of the workforce. Additionally, a
layoff plan for employees born
in
1962 was agreed in May 2024,
to address the labor implications of decarbonization initiatives as
per the Memorandum of Understanding between the Spanish
government and ArcelorMittal.
In 2024, the situation in Ukraine continued to be difficult in terms
of personnel due to the war with Russia. The martial law
imposed by the country's government since February 2022,
which, among other things, limits the labor rights of employees
and trade unions (such as the right to strike; the right to
vacation, etc.) remains in force. In 2024, more than 3,000 of
AMKR’s employees were mobilized and more than 220 died in
the war or went missing in action. The facility continued to
experience a significant outflow of personnel, mainly men, due
to mobilization. As a consequence, it launched recruitment
campaigns to attract women and young people. Despite
operating at 30-50% of production capacity, AMKR maintained
work positions and wages for its 18,000 workers avoiding
layoffs.
In South Africa, out of the 5,997 employees at AMSA, 4,182
employees (70% of the workforce) are covered by a CLA/
Bargaining council agreement concluded between management
and the recognized trade unions i.e. NUMSA and Solidarity
trade unions. The CLA will expire in March 2026. From April
2023 to March 2024, the agreement comprised a range of
provisions encompassing a 6.5% remuneration adjustment for
all employees within the bargaining unit. It further incorporated
an ex-gratia premium, enhancements to the medical aid subsidy
and a 6.5% increase in all allowances excluding retention and
protected allowances. The company’s contribution to medical
aid will progressively rise, reaching 70% by 2026 while the
employee’s contribution will decrease to 30%. In 2024, the
company gave a 5% salary increase to permanent bargaining
and package category employees.
Throughout 2024, ArcelorMittal Mining maintained a productive
engagement with its trade unions and communities where it
operates. 76% of the workforce is unionized in ArcelorMittal's
operations in Canada and 82% in ArcelorMittal's operations in
Liberia.
Corporate governance
This section describes the corporate governance practices of
ArcelorMittal for the year ended December 31, 2024.
Board of Directors and senior management
ArcelorMittal is governed by a Board of Directors and managed
by the senior management. As described in "Directors and
senior management" above, ArcelorMittal’s senior management
is comprised of the Executive Office - comprising the Executive
Chairman, Mr. Lakshmi N. Mittal and the CEO, Mr. Aditya Mittal.
The Executive Office is supported by a team of nine other
Executive Officers, who together encompass the key regions
and corporate functions. As of December 31, 2024, the average
age and serving period of board members is 61 years and 10
years, respectively.
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A number of corporate governance provisions in the Articles of
Association of ArcelorMittal reflect provisions of the
Memorandum of Understanding signed on June 25, 2006 (prior
to Mittal Steel Company N.V.’s merger with Arcelor), amended in
April 2008 and which mostly expired on August 1, 2009. For
more information about the Memorandum of Understanding, see
“Additional information—Material contracts—Memorandum of
Understanding”.
ArcelorMittal fully complies with the 10 Principles of Corporate
Governance of the Luxembourg Stock Exchange. This is
explained in more detail in “—Other corporate governance
practices” below. ArcelorMittal also complies with the New York
Stock Exchange Listed Company Manual as applicable to
foreign private issuers. There are no significant differences
between the corporate governance practices of ArcelorMittal
and those required of a U.S. domestic issuer under the Listed
Company Manual of the New York Stock Exchange.
Board of Directors
The Board of Directors is in charge of the overall governance
and direction of ArcelorMittal. It is responsible for the
performance of all acts of administration necessary or useful in
furtherance of the corporate purpose of ArcelorMittal, except for
matters reserved by Luxembourg law or the Articles of
Association to the general meeting of shareholders. The Articles
of Association provide that the Board of Directors is composed
of a minimum of 3 and a maximum of 18 members.
The Articles of Association provide that directors are elected and
removed by the general meeting of shareholders by a simple
majority of votes cast. Other than as set out in the Company’s
Articles of Association, no shareholder has any specific right to
nominate, elect or remove directors. Directors are elected by the
general meeting of shareholders for three-year terms. In the
event that a vacancy arises on the Board of Directors for any
reason, the remaining members of the Board of Directors may
by a simple majority elect a new director to temporarily fulfill the
duties attaching to the vacant post until the next general
meeting of the shareholders.
For further information on the composition of the Board of
Directors, including the expiration of each Director’s term and
the per
iod during which each Director has served, see section
"—Directors and senior management " above.
Mr. Lakshmi N. Mittal was elected Chairman of the Board of
Directors on May 13, 2008. Mr. Lakshmi N. Mittal was also
ArcelorMittal’s CEO until February 11, 2021. Mr. Lakshmi N.
Mittal was re-elected to the Board of Directors for a three-year
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|
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|
term at the annual general meeting of shareholders on May 2,
2023.
A director is considered “independent” if:
(a)
he or she is independent within the meaning of the
New York Stock Exchange Listed Company Manual, as
applicable to foreign private issuers,
(b)
he or she is unaffiliated with any shareholder owning or
controlling more than two percent of the total issued
share capital of ArcelorMittal, and
(c)
the Board of Directors makes an affirmative
determination to this effect.
For these purposes, a person is deemed affiliated to a
shareholder if he or she is an executive officer, a director who
also is an employee, a general partner, a managing member or
a controlling shareholder of such shareholder. The 10 Principles
of Governance of the Luxembourg Stock Exchange, which
constitute ArcelorMittal's domestic corporate governance code,
require ArcelorMittal to define the independence criteria that
apply to its directors, which are described in article 8.1 of its
Articles of Association.
Specific characteristics of the director role
|
Required share
ownership
Lead Independent Director - minimum of 6,000
ordinary shares
Non-executive directors - minimum of 4,000
ordinary shares
|
Maximum 12
year service
(independent
directors)
|
May not serve
on
the boards of directors of
more than four
publicly listed companies (non-
executive directors)
|
Required to
sign the
Company’s Code of
Business Conduct
and confirm their adherence
annually
|
The Company’s Articles of Association do not require directors
to be shareholders of the Company. The Board of Directors
nevertheless adopted a share ownership policy on October 30,
2012, that was amended on November 7, 2017, considering that
it is in the best interests of all shareholders for all non-executive
directors to acquire and hold a minimum number of ArcelorMittal
ordinary shares in order to better align their long-term interests
with those of ArcelorMittal’s shareholders. The Board of
Directors believes that this share ownership policy will result in a
meaningful holding of ArcelorMittal shares by each non-
executive director, while at the same time taking into account
the fact that the share ownership requirement should not be
excessive in order not to unnecessarily limit the pool of available
candidates for appointment to the Board of Directors. Directors
must hold their shares directly or indirectly, and as sole or joint
beneficiary owner (e.g., with a spouse or minor children), at the
latest within three years of his or her election to the Board of
Directors. Each director will hold the shares acquired on the
basis of this policy for so long as he or she serves on the Board
of Directors. Directors purchasing shares in compliance with this
policy must comply with the ArcelorMittal Insider Dealing
Regulations and, in particular, refrain from trading during any
restricted period, including any such period that may apply
immediately after the Director’s departure from the Board of
Directors for any reason.
On October 30, 2012, the Board of Directors also adopted a
policy that places limitations on the terms of independent
directors as well as the number of directorships that directors
may hold in order to align the Company’s corporate governance
practices with best practices in this area (as highlighted in the
table above). Nevertheless, the Board of Directors may, by way
of exception to this rule, make an affirmative determination, on a
case-by-case basis, that a Director may continue to serve
beyond the 12-year rule if the Board of Directors considers it to
be in the best interest of the Company based on the contribution
of the Director involved taking into consideration the balance
between the knowledge, skills, experience of the director and
the need for renewal of the Board.
As membership of the Board of Directors represents a
significant time commitment, the policy requires both executive
and non-executive directors to devote sufficient time to the
discharge of their duties as a Director of ArcelorMittal. Directors
are therefore required to consult with the Chairman and the
Lead Independent Director before accepting any additional
commitment that could conflict with or impact the time they can
devote to their role as a Director of ArcelorMittal. A non-
executive Director’s service on the board of directors of any
subsidiary or affiliate of ArcelorMittal or of any non-publicly listed
company is not taken into account for purposes of complying
with the service limitation.
Although non-executive directors of ArcelorMittal who change
their principal occupation or business association are not
necessarily required to leave the Board of Directors, the policy
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requires each non-executive director, in such circumstances, to
promptly inform the Board of Directors of the action he or she is
contemplating. Should the Board of Directors determine that the
contemplated action would generate a conflict of interest, such
non-executive director would be asked to tender his or her
resignation to the Chairman of the Board of Directors, who
would decide to accept the resignation or not.
None of the members of the Board of Directors, including the
executive directors, have entered into service contracts with
ArcelorMittal or any of its subsidiaries that provide for any form
of remuneration or for benefits upon the termination of their
term. All non-executive Directors of the Company signed the
Company’s Appointment Letter, which confirms the conditions of
their appointment by the General Meeting of the Shareholders
including compliance with certain non-compete provisions, the
10 Principles of Corporate Governance of the Luxembourg
Stock Exchange and the Company’s Code of Business Conduct.
The remuneration of the members of the Board of Directors is
determined on a yearly basis by the annual general meeting of
shareholders.
Share transactions by management
In compliance with laws prohibiting insider dealing, the Board of
Directors of ArcelorMittal has adopted insider dealing
regulations, which apply throughout the ArcelorMittal group.
These regulations are designed to ensure that insider
information is treated appropriately within the Company and
avoid insider dealing and market manipulation. Any breach of
the rules set out in this procedure may lead to criminal or civil
charges against the individuals involved, as well as disciplinary
action by the Company.
Operation
General
The Board of Directors and the Board committees may engage
the services of external experts or advisers as well as take all
actions necessary or useful to implement the Company’s
corporate purpose. The Board of Directors (including its three
committees) has its own budget, which covers functioning costs
such as external consultants, continuing education activities for
directors and travel expenses.
Meetings
The Board of Directors meets when convened by the Chairman
of the Board or any two members of the Board of Directors. The
Board of Directors holds physical meetings at least on a
quarterly basis as five regular meetings are scheduled per year.
The Board of Directors holds additional meetings if and when
circumstances require, in person or by teleconference and can
take decisions by written circulation, provided that all members
of the Board of Directors agree.
In 2024, the Board of Directors held
7
meetings with 100% of
the average attendance rate.
|
7 meetings
(2024)
|
100% Average
attendance rate
|
In order for a meeting of the Board of Directors to be validly
held, a majority of the directors must be present or represented,
including at least a majority of the independent directors. In the
absence of the Chairman, the Board of Directors will appoint a
chairman by majority vote for the meeting in question. The
Chairman may decide not to participate in a Board of Directors’
meeting, provided he has given a proxy to one of the directors
who will be present at the meeting. For any meeting of the
Board of Directors, a director may designate another director to
represent him or her and vote in his or her name, provided that
the director so designated may not represent more than one of
his or her colleagues at any time.
Each director has one vote and none of the directors, including
the Chairman, has a casting vote. Decisions of the Board of
Directors are made by a majority of the directors present and
represented at a validly constituted meeting, except for the
decisions of the Board of Directors relating to the issue of any
financial instruments carrying or potentially carrying a right to
equity pursuant to the authorization conferred by article 5.5 of
the Articles of Association, which shall be taken by a majority of
two-thirds of the directors present or represented at a validly
constituted meeting.
Lead Independent Director
Mrs. Karyn Ovelmen was elected by the Board of Directors as
ArcelorMittal's Lead Independent Director at the board meeting
held on May 2, 2023.
The agenda of each meeting of the Board of Directors is
decided jointly by the Chairman of the Board of Directors and
the Lead Independent Director.
Separate meetings of independent directors
The independent members of the Board of Directors may
schedule meetings outside the presence of non-independent
directors. Systematic executive sessions take place at the end
of each committee and of each board meeting.
Nineteen
meetings of the independent directors outside the presence of
management were held in 2024.
Annual self-evaluation
The Board of Directors decided in 2008 to start conducting an
annual self-evaluation of its functioning in order to identify
potential areas for improvement. The first self-evaluation
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Management report
|
process was carried out in early 2009. The self-evaluation
process includes structured interviews between the Lead
Independent Director and each director and covers the overall
performance of the Board of Directors, its relations with senior
management, the performance of individual directors, and the
performance of the committees. The process is supported by
the Company Secretary under the supervision of the Chairman
and the Lead Independent Director. The findings of the self-
evaluation process are examined by the ARCG Committee and
presented with recommendations from the ARCG Committee to
the Board of Directors for adoption and implementation.
Suggestions for improvement of the Board of Directors’ process
based on the prior year’s performance and functioning are
implemented during the following year.
The 2024 Board of Directors’ self-evaluation was completed by
the Board
on February 5
, 2025
.
The Board of Directors was of
the opinion that it and the management had cooperated
successfully during 2024. Strong focus has continued to be
given on health and safety, on environmental matters, on Board
succession planning as well as on the operations in
India
and
Europe. The Board of Directors reviewed the practical
implementation of the governance structure and considered it
was working well. The Board set new priorities for discussion
and review and identified a number of priority topics for 2025.
The Board of Directors believes that its members have the
appropriate range of skills, knowledge and experience, as well
as the degree of perspectives, experiences and background
necessary to enable it to effectively govern the business. The
Board of Directors composition is reviewed on a regular basis
and additional skills and experience are actively searched for in
line with the expected development of ArcelorMittal’s business
as and when appropriate.
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|
Management report
|
Required skills, experience and other personal
characteristics
|
ArcelorMittal Board Skills Matrix
|
|||||||||||
|
Director Qualifications
|
Competencies and relevance to ArcelorMittal
|
Lakshmi N. Mittal
|
Aditya Mittal
|
Vanisha Mittal Bhatia
|
Karyn Ovelmen
|
Michel Wurth
|
Clarissa Lins
|
Karel de Gucht
|
Etienne Schneider
|
Patricia Barbizet
|
TOTAL
|
|
Individuals who have achieved
prominence in their fields
|
Current CEO/Former CEO
Experience serving as a CEO or other prominent leader provides
unique perspectives to help the Board independently oversee
ArcelorMittal's CEO and management and increases understanding and
appreciation of the many facets of modern international organizations,
including strategic planning, financial reporting and compliance, and
risk oversight.
|
x
|
x
|
x
|
3
|
||||||
|
Experience and demonstrated
expertise in managing large
relatively complex
organizations, such as CEOs
of a significant company or
organization with global
responsibilities
|
Large or complex Organizations/Global Business/Industrial
Operations Experience
Experience leading a large organization or global business provides
practical insights on the challenges and opportunities complex
businesses encounter in diverse business environments, economic
conditions and cultures; having experience with industrial operations
assists in understanding the issues that may face ArcelorMittal in its
worldwide activities, including maintenance needs, labor relations and
regulatory requirements.
|
x
|
x
|
x
|
x
|
x
|
x
|
x
|
x
|
x
|
9
|
|
Government/Regulatory/Public Policy Experience
Experience in government and regulatory affairs is helpful as the steel
industry is heavily regulated in countries around the world and changes
in public policy could affect ArcelorMittal's business.
|
x
|
x
|
x
|
x
|
x
|
5
|
|||||
|
Financial or other risk
management expertise
|
Financial Experience
An understanding of the reporting responsibilities of public companies
and the issues commonly faced by public companies is important in
navigating governance issues as they apply to ArcelorMittal.
|
x
|
x
|
x
|
x
|
x
|
5
|
||||
|
Risk Management Experience
Experience in effectively identifying, prioritizing and managing a broad
spectrum of risks can help the Board in assessing, anticipating and
overseeing the Company's management of the risks faced by its
various businesses.
|
x
|
x
|
x
|
x
|
x
|
x
|
6
|
||||
|
Experience in managing ESG
risks and opportunities
including emerging ESG
regulations, reporting
standards and human rights
policies and procedures
|
Safety, Human Rights & Environment
|
x
|
x
|
x
|
x
|
x
|
x
|
6
|
|||
|
Climate Change and Decarbonization
|
x
|
x
|
x
|
x
|
x
|
5
|
|||||
|
Mergers and Acquisitions
|
Mergers, acquisitions, disposals, joint ventures, private equity and
investment experience
|
x
|
x
|
x
|
x
|
x
|
x
|
6
|
|||
|
Experience on one or more
boards of significant public
organizations
|
Public Company Board
An understanding of the reporting responsibilities of public companies
and the issues commonly faced by public companies is important in
navigating
|
x
|
x
|
x
|
x
|
x
|
x
|
x
|
x
|
x
|
9
|
|
Industry experience
|
Industry/Commodity/Cyclical Business experience
Understanding the unique challenges of a cyclical or commodity
business provides useful insights in assessing business strategies,
challenges and opportunities.
|
x
|
x
|
x
|
x
|
x
|
x
|
x
|
x
|
8
|
|
|
Relevant country/regional
expertise
|
Knowledge of the countries in the regions of
strategic importance to the Group
|
x
|
x
|
x
|
x
|
x
|
x
|
x
|
x
|
x
|
9
|
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|
Management report
|
Diverse skills, perspectives, knowledge, backgrounds and
experience are required in order to effectively govern a global
business the size of the Company’s operations. The Board of
Directors and its committees are therefore required to ensure
that the Board has the right balance of skills, experience,
independence and knowledge necessary to perform its role in
accordance with the highest standards of governance.
The Company’s directors must demonstrate unquestioned
honesty and integrity, preparedness to question, challenge and
critique constructively, and a willingness to understand and
commit to the highest standards of governance. They must be
committed to the collective decision-making process of the
Board of Directors and must be able to debate issues openly
and constructively, and question or challenge the opinions of
others. Directors must also commit themselves to remain
actively involved in Board decisions and apply strategic thought
to matters at issue. They must be clear communicators and
good listeners who actively contribute to the Board in a collegial
manner. Each director must also ensure that no decision or
action is taken that places his or her interests before the
interests of the business. Each director has an obligation to
protect and advance the interests of the Company and must
refrain from any conduct that would harm it.
In order to govern effectively, non-executive directors must have
a clear understanding of the Company’s strategy, and a
thorough knowledge of the ArcelorMittal group and the
industries in which it operates. Non-executive directors must be
sufficiently familiar with the Company’s core business to
effectively contribute to the development of strategy and monitor
performance.
With specific regard to the non-executive directors of the
Company, the composition of the group of non-executive
directors should be such that the combination of experience,
knowledge and independence of its members allows the Board
to fulfill its obligations towards the Company and other
stakeholders in the best possible manner.
The ARCG Committee ensures that the Board of Directors is
comprised of high-caliber individuals whose background, skills,
experience and personal characteristics enhance the overall
profile of the Board and meets its needs by nominating high
quality candidates for election to the Board by the general
meeting of shareholders.
Board profile
The key skills and experience of the directors, and the extent to
which they are represented on the Board of Directors and its
committees, are set out below. In summary, the non-executive
directors contribute:
Renewal
The Board of Directors plans for its own succession, with the
assistance of the ARCG Committee. In doing this, the Board of
Directors:
•
considers the skills, backgrounds, knowledge, and
experience necessary to allow it to meet the corporate
purpose;
•
assesses the skills, backgrounds, knowledge and
experiences currently represented;
•
identifies any inadequate representation of those
attributes and agrees the process necessary to ensure
a candidate is selected who brings them to the Board
of Directors; and
•
reviews how Board performance might be enhanced,
both at an individual director level and for the Board as
a whole.
The Board believes that orderly succession and renewal is
achieved through careful planning and by continuously
reviewing the composition of the Board.
When considering new appointments to the Board, the ARCG
Committee oversees the preparation of a position specification
that is provided to an independent recruitment firm retained to
conduct a global search, taking into account, among other
factors, geographic location, nationality and gender. In addition
to the specific skills, knowledge and experience required of the
candidate, the specification contains the criteria set out in the
ArcelorMittal Board profile.
Director induction, training and development
The Board considers that the development of the directors’
knowledge of the Company, the steel-making and mining
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|
Management report
|
industries, and the markets in which the Company operates is
an ongoing process. To further bolster the skills and knowledge
of directors, the Company set up a continuous development
program in 2009.
Upon his or her election, each new non-executive director
undertakes an induction program specifically tailored to his or
her needs and includes ArcelorMittal’s long-term vision centered
on the concept of “Safe Sustainable Steel”.
The Board’s development activities include the provision of
regular updates to directors on each of the Company’s products
and markets. Non-executive directors may also participate in
training programs designed to maximize the effectiveness of the
directors throughout their tenure and link in with their individual
performance evaluations. The training and development
program may cover not only matters of a business nature, but
also matters falling into the environmental, social and
governance area.
Structured opportunities are provided to build knowledge
through initiatives such as visits to plants and mine sites and
business briefings provided at Board meetings. Non-executive
directors also build their Company and industry knowledge
through the involvement of the Executive Office and other senior
employees in Board meetings. Business briefings, site visits and
development sessions underpin and support the Board’s work in
monitoring and overseeing progress towards the corporate
purpose of creating long-term shareholder value through the
development of the ArcelorMittal business in steel and mining.
The Company therefore continuously builds directors’
knowledge to ensure that the Board remains up-to-date with
developments within the Company’s segments, as well as
developments in the markets in which the Company operates.
During the year, non-executive directors participated in the
following activities:
•
comprehensive business briefings intended to provide
the directors with a deeper understanding of the
Company’s activities, environment, key issues and
strategy of the Company’s segments. These briefings
are provided to the Board of Directors by senior
executives, including Executive Office members. The
briefings provided during the course of 2024 covered
many areas. In particular, a strong emphasis has been
given to health and safety processes, fatality
prevention, environment and climate change. Specific
major acquisitions were reviewed. In addition, cyber
security, risk management, corporate responsibility,
carbon reduction strategy in steelmaking, capital
allocation process and strategy were covered.
Business briefings took place at Board and committee
meetings;
•
briefing meetings with the Company executives in
charge of specific business segments or markets;
•
site visits of directors to plants and R&D centers; and
•
development sessions on specific topics of relevance,
such as health and safety, commodity markets, HR,
investor relations, accounting, the world economy,
changes in corporate governance standards, directors’
duties and shareholder feedback.
The ARCG Committee oversees director training and
development. This approach allows induction and learning
opportunities to be tailored to the directors’ committee
memberships, as well as the Board of Directors' specific areas
of focus. In addition, this approach ensures a coordinated
process in relation to succession planning, Board renewal,
training, development and committee composition, all of which
are relevant to the ARCG Committee’s role in securing the
supply of talent to the Board.
Board of Directors committees
The Board of Directors has three committees:
•
the Audit & Risk Committee,
•
the ARCG Committee, and
•
the Sustainability Committee.
Audit & Risk Committee
|
4 members
(100%
independent)
|
6 meetings
(2024)
|
In 2024, 6 meetings of the Audit & Risk Committee were held
with an attendance rate of 100%.
The primary function of the Audit & Risk Committee is to assist
the Board in fulfilling its oversight responsibilities by reviewing:
•
the integrity of the financial reports and other financial
information provided by the Company to any
governmental body or the public;
•
the Company’s compliance with legal and regulatory
requirements;
•
the registered public accounting firm’s (Independent
Auditor) qualifications and independence;
•
the Company’s system of internal control regarding
finance, accounting, legal compliance, ethics and risk
management that management and the Board have
established;
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Management report
|
•
the Company’s auditing, accounting and financial
reporting processes generally;
•
the identification and management of risks to which the
ArcelorMittal group is exposed; and
•
conducting investigations into any matters, including
whistleblower complaints, within its scope of
responsibility and obtaining advice from outside legal,
accounting, or other advisers, as necessary, to perform
its duties and responsibilities.
The Audit & Risk Committee must be composed solely of
independent members of the Board of Directors. The members
are appointed by the Board of Directors each year after the
annual general meeting of shareholders. The Audit & Risk
Committee is comprised of four members, all of whom must be
independent under the Company’s corporate governance
guidelines, the NYSE standards as applicable to foreign private
issuers and the 10 Principles of Corporate Governance of the
Luxembourg Stock Exchange. The Audit & Risk Committee
makes decisions by a simple majority with no member having a
casting vote.
At least one member must qualify as an "audit committee
financial expert” as defined by the SEC and determined by the
Board.
At least one member must qualify as an Audit & Risk Committee
“risk management expert” having experience in identifying,
assessing, and managing risk exposures of large, complex
companies.
The Audit & Risk Committee currently consists of 4 members:
Mrs. Karyn Ovelmen, Mrs. Patricia Barbizet, Mr. Karel de Gucht
and Mr. Etienne Schneider, each of whom is an independent
Director according to the NYSE standards and the 10 Principles
of Corporate Governance of the Luxembourg Stock Exchange.
The
Chairwoman
of the Audit & Risk Committee is Mrs. Patricia
Barbizet who is an “audit committee financial expert” as defined
by the SEC.
Please see “—–Directors and senior management
—–Board of Directors” above for Mrs. Barbizet's experience.
According to its charter, the Audit & Risk Committee is required
to meet at least four times a year. The Audit & Risk Committee
performs an annual self-evaluation and completed its 2024 self-
evaluation on February 5
, 2025
. The charter of the Audit & Risk
Committee is available from ArcelorMittal upon request.
Appointments, Remuneration and Corporate Governance
Committee
|
3 members
(100%
independent)
|
7 meetings
(2024)
|
In 2024, 7 meetings of the ARCG Committee were held, with an
attendance rate of 100%.
The ARCG Committee is comprised of three directors, each of
whom is independent under the New York Stock Exchange
standards as applicable to foreign private issuers and the 10
Principles of Corporate Governance of the Luxembourg Stock
Exchange.
The members are appointed by the Board of Directors each
year after the annual general meeting of shareholders. The
ARCG Committee makes decisions by a simple majority with no
member having a casting vote.
The primary function of the ARCG Committee is to assist the
Board of Directors of ArcelorMittal by:
•
reviewing and approving corporate and personal goals
and objectives relevant to the compensation of members
of the Executive Office, executive officers and senior
management and evaluating their performance
considering these goals and objectives;
•
making recommendations to the
Board of Directors
on
the Company`s framework of remuneration for the
members of the Executive Office and executive officers
and such other senior executives as the ARCG
Committee may determine;
•
approving any contract of employment or related contract
with members of the Executive Office and executive
officers;
•
determining the terms of any compensation package in
the event of early termination of the employment contract
of any members of the Executive Office and of the
executive officers;
•
making recommendations to the
Board of Directors
regarding the content of the Company`s annual report to
shareholders or any regulatory filings that relates to
compensation matters (including ArcelorMittal`s policy on
the compensation of members of the Executive Office
and executive officers, individual remuneration details
and other terms and conditions);
•
carrying out an annual performance self-evaluation and a
review of the charter of
the ARCG Committee
including
additions to the function of the Committee, as may be
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|
Management report
|
necessary due to changed circumstances or laws or
regulations;
•
evaluating and proposing improvements for the induction
program for newly appointed members of the Board of
Directors;
•
reviewing and, where necessary, proposing changes to
the chairmanship or membership of any Board
committee;
•
making recommendations to the
Board of Directors
with
respect to trends in
Board of Directors
' remuneration,
incentive compensation plans and equity-based incentive
plans;
•
producing a report on executive compensation to be
included in ArcelorMittal`s annual report;
•
identifying candidates qualified to serve as member of the
Board of Directors as per the selection criteria and as
members of the Executive Office, executive officers and
senior managers;
•
recommending candidates to the
Board of Directors
for
appointment by the general meeting of shareholders or,
to the extent permitted by law, for appointment by the
Board of Directors
to fulfill interim Board vacancies;
•
developing, monitoring and reviewing corporate
governance principles applicable to ArcelorMittal;
•
facilitating the evaluation that the
Board of Directors
will
make on the topics covered by ARCG Committee;
•
assessing the independence of the members of the
Board of Directors on an annual basis;
•
reviewing the succession planning and the executive
development program for the Executive Office and
executive officers;
•
reviewing relevant Policies and Procedures relating to
Compliance and Corporate Governance, as needed;
•
reviewing employee surveys, as available; and
•
reviewing the analysis of proxy advisory firms in the
context of corporate governance compensation.
The ARCG Committee’s principal criteria in determining the
compensation of executives is to encourage and reward
performance that will lead to long-term enhancement of
shareholder value. The ARCG Committee may seek the advice
of outside experts.
The three members of the ARCG Committee are Mrs. Karyn
Ovelmen, Mrs. Clarissa Lins and Mr. Etienne Schneider, each of
whom is independent in accordance with the NYSE standards
applicable to foreign private issuers and the 10 Principles of
Corporate Governance of the Luxembourg Stock Exchange.
The
Chairwoman
of the ARCG Committee is Mrs. Karyn
Ovelmen.
The ARCG Committee is required to meet at least three times a
year. The ARCG Committee performs an annual self-evaluation
and completed its 2024 self-evaluation on February 5
, 2025
.
The charter of the ARCG Committee is available from
ArcelorMittal upon request.
Succession management
Succession management at ArcelorMittal is a systematic,
structured process for identifying and preparing employees with
potential to fill key organizational positions, should the position
become vacant. This process applies to all ArcelorMittal key
positions up to and including the Executive Office. Succession
management aims to ensure the continued effective
performance of the organization by providing for the availability
of experienced and capable employees who are prepared to
assume these roles as they become available. For each
position, candidates are identified based on performance,
potential and an assessment of leadership capabilities and their
“years to readiness”. Development needs linked to the
succession plans are discussed, after which “Personal
Development Plans” are put in place, to accelerate development
and prepare candidates. Regular reviews of succession plans
are conducted at different levels of the organization to ensure
that they are accurate and up to date, leading to at least once a
year formal review by the Executive Office, of all key positions.
Succession management is a necessary process to reduce risk
of vacant positions or skill gap transitions, create a pipeline of
future leaders, ensure smooth business continuity and improve
employee motivation and engagement. This process has been
in place for several years and reinforced, widened and made
more systematic in all regions of the organization. The
responsibility to review and approve succession plans and
contingency plans at the highest level rests with the Board’s
ARCG Committee.
Sustainability Committee
|
3 members
(67%
independent)
|
7 meetings
(2024)
|
In 2024, 7 meetings of Sustainability Committee were held, with
an attendance rate o
f 86%.
The Sustainability Committee ("SC") is comprised of three
members, of whom two are independent.
The SC makes
decisions by simple majority with no member having a casting
vote.
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|
Management report
|
The primary function of the SC is to assist the Board of Directors
on the following areas:
•
review Group level frameworks, policies, standards and
guidelines in sustainability matters;
•
review and approve the identification of material
sustainability impacts, risks and opportunities and the
corresponding controls and governance processes to
manage those;
•
review the Company's sustainable development plan and
targets and associated management systems and ensure
the Group is well positioned to meet the evolving
expectations of stakeholders, including investors,
customers, regulators, employees, and communities;
•
review the effectiveness of the process for assessing and
managing catastrophic risks;
•
coordinate the SC’s impact, risk and opportunity
management work with the Audit and Risk Committee, in
relation to reporting to the
Board of Directors
;
•
review the findings of important climate action reports
and the management response;
•
support and provide guidance to management in
developing and updating policies and procedures relating
to employee health & safety, environment, climate
change, social and supply chain and other material
sustainability topics;
•
review and approve processes to establish effectiveness
of policies, actions, metrics and targets related to
sustainability material risks, impacts and opportunities;
•
monitor any current, pending or threatened legal actions
with respect to health and safety, climate change,
environment, social and supply chain and other relevant
sustainability issues;
•
review and approve a report on sustainable development
plan to be included in ArcelorMittal’s Annual Report;
•
review and recommend to the Board of Directors on the
adequacy of the reporting on sustainability opportunities,
risks, impacts and issues in the annual report,
Sustainability Report, and other relevant public
documents;
•
make recommendations to the Board of Directors with
respect to trends in results and programs in all covered
areas;
•
make recommendations on material sustainability
impacts, risks and opportunities when overseeing
strategy and decisions on major transactions;
•
ensure that the SC Chair (or in her absence, an
alternative member) attends the Company’s annual
general meeting to answer questions concerning
sustainability matters and their development and/or
implementation; and
•
oversee any investigation and/or undertake any thorough
analysis which is within its scope.
The three members of the SC are Mrs. Clarissa Lins, Mr.
Etienne Schneider and Mr. Michel Wurth. Mrs. Lins and Mr.
Schneider are independent in accordance with the Company’s
corporate governance guidelines, the NYSE standards and the
10 Principles of Corporate Governance of the Luxembourg
Stock Exchange. The
Chairwoman
of the SC is Mrs. Lins.
The members have relevant expertise or experience relating to
the objective of the SC. The responsible senior managers
pertaining to their respective areas of responsibility - health and
safety, environment, climate change, for community relations -
are permanent invitees to the meetings of the SC. The
Chairman of the SC makes a verbal report of the SC’s decisions
and findings to the Board of Directors after each SC meeting.
Other corporate governance practices
ArcelorMittal is committed to adhering to best practices in terms
of corporate governance in its dealings with shareholders and
aims to ensure good corporate governance by applying rules on
transparency, quality of reporting and the balance of powers.
ArcelorMittal continually monitors U.S., EU and Luxembourg
legal requirements and best practices in order to make
adjustments to its corporate governance controls and
procedures when necessary, as evidenced by the policies
adopted by the Board of Directors in 2012.
ArcelorMittal complies with the 10 Principles of Corporate
Governance of the Luxembourg Stock Exchange in all respects.
Ethics and conflicts of interest
Ethics and conflicts of interest are governed by ArcelorMittal’s
Code of Business Conduct, which establishes the standards for
ethical behavior that are to be followed by all employees and
directors of ArcelorMittal in the exercise of their duties, including
the Company's CEO and CFO. Each employee of ArcelorMittal
is required to sign and acknowledge the Code of Conduct upon
joining the Company. This also applies to the members of the
Board of Directors of ArcelorMittal, who signed the Company’s
Appointment Letter in which they acknowledged their duties and
obligations. Any new member of the Board of Directors must
sign and acknowledge the Code of Conduct upon appointment.
Employees must always act in the best interests of ArcelorMittal
and must avoid any situation in which their personal interests
conflict, or could conflict, with their obligations to ArcelorMittal.
Employees are prohibited from acquiring any financial or other
interest in any business or participating in any activity that could
deprive ArcelorMittal of the time or the attention needed to
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|
devote to the performance of their duties. Any behavior that
deviates from the Code of Business Conduct is to be reported to
the employee’s supervisor, a member of the management, the
head of the legal department or the head of the Global
Assurance department.
Code of Business Conduct
Conduct training is offered throughout ArcelorMittal on a regular
basis in the form of face-to-face trainings, webinars and online
trainings. Employees are periodically trained about the Code of
Business Conduct in each location where ArcelorMittal has
operations. The Code of Business Conduct is available in the
“Corporate Governance-Compliance and Policies-Code of
Business Conduct” section of ArcelorMittal’s website at
www.arcelormittal.com and has been disseminated through
Company-wide communications.
In addition to the Code of Business Conduct, ArcelorMittal has
developed a Human Rights Policy
(available in the “Corporate
Governance-Compliance and Policies-Human Rights Policy”
section of ArcelorMittal’s website at www.arcelormittal.com) and
a number of other compliance policies in more specific areas,
such as antitrust, anti-corruption, economic sanctions, insider
dealing and data protection. In all these areas, specifically
targeted groups of employees are required to undergo
specialized compliance training. Furthermore, ArcelorMittal’s
compliance program also includes a quarterly compliance
certification process covering all business segments and
entailing reporting to the Audit & Risk Committee.
ArcelorMittal intends to disclose any amendment to or waiver
from the Code of Business Conduct applicable to any of
ArcelorMittal’s directors, its CEO, CFO or any other person who
is an Executive Officer of ArcelorMittal on ArcelorMittal’s website
at www.arcelormittal.com.
Process for Handling Complaints on Accounting Matters
As part of the procedures of the Board of Directors for handling
complaints or concerns about accounting, internal controls and
auditing issues, ArcelorMittal’s Anti-Fraud Policy and Code of
Business Conduct encourage all employees to bring such
issues to the Audit & Risk Committee’s attention on a
confidential basis. In accordance with ArcelorMittal’s Anti-Fraud
and Whistleblower Policy, concerns with regard to possible fraud
or irregularities in accounting, auditing or banking matters or
bribery within ArcelorMittal or any of its subsidiaries or other
controlled entities may also be communicated through the “—
Corporate Governance—Whistleblower” section of the
ArcelorMittal website at www.arcelormittal.com, where
ArcelorMittal’s Anti-Fraud Policy and Code of Business Conduct
are also available in each of the main working languages used
within the Group. In recent years, ArcelorMittal has implemented
local whistleblowing facilities, as needed.
Global Assurance
ArcelorMittal has a Global Assurance function that, through its
Head of Global Assurance, reports to the Audit & Risk
Committee. The function is staffed by full-time professional staff
located within each of the principal operating subsidiaries and at
the corporate level. Recommendations and matters relating to
internal control and processes are made by the Global
Assurance function and their implementation is regularly
reviewed by the Audit & Risk Committee.
Independent auditors
The appointment and determination of fees of the independent
auditors is the direct responsibility of the Audit & Risk
Committee. The Audit & Risk Committee is further responsible
for obtaining, at least once each year, a written statement from
the independent auditors that their independence has not been
impaired. The Audit & Risk Committee has also obtained a
confirmation from ArcelorMittal’s principal independent auditors
to the effect that none of its former employees are in a position
within ArcelorMittal that may impair the principal auditors’
independence.
I
nsider Dealing Regulations
ArcelorMittal has
adopted
insider trading policies and
procedures (“Insider Dealing Regulations” or "IDR") governing
the purchase, sale, and other dispositions of its securities by
directors, senior management, and employees that are
reasonably designed to promote compliance with insider trading
laws, rules and regulations and listing standards applicable to
the Company. IDR are updated when necessary (most recently
in January 2023) and training is conducted throughout the
Group in relation to them. The IDR’s most recent version was
updated in light of the new Market Abuse Regulation. IDR are
available on ArcelorMittal’s website, www.arcelormittal.com and
are attached as Exhibit 11.1 to this annual report.
The IDR apply to the worldwide operations of ArcelorMittal. The
compliance and data protection officer of ArcelorMittal is also
the IDR compliance officer and answers questions that
members of senior management, the Board of Directors, or
employees may have about the IDR’s interpretation. The IDR
compliance officer maintains a list of insiders as required by
Regulation No 596/2014 of the European Parliament and the
Council dated April 16, 2014 on market abuse or “MAR” and the
Commission Implementing Regulation 2016/347 of 10 March
2016 laying down technical standards with regard to the precise
format of insider lists and for updating insider lists in accordance
with MAR. The IDR compliance officer may assist senior
executives and directors with the filing of notices required by
Luxembourg law to be filed with the Luxembourg financial
regulator, the CSSF (Commission de Surveillance du Secteur
Financier). Furthermore, the IDR compliance officer has the
power to conduct investigations in connection with the
application and enforcement of the IDR, in which any employee
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or member of senior management or of the Board of Directors is
required to cooperate.
Selected new employees of ArcelorMittal are required to
participate in a training course about the IDR upon joining
ArcelorMittal and every three years thereafter. The individuals
who must participate in the IDR training include the members of
senior management, employees who work in finance, legal,
sales, mergers and acquisitions and other areas that the
Company may determine from time to time. In addition,
ArcelorMittal’s Code of Business Conduct contains a section on
“Trading in the Securities of the Company” that emphasizes the
prohibition to trade on the basis of inside information. An online
interactive training tool based on the IDR is currently deployed
across the group through ArcelorMittal’s intranet, with the aim to
enhance the staff’s awareness of the risks of sanctions
applicable to insider dealing. The importance of the IDR is again
reiterated in the Group's internal Group Policies and Procedures
Manual.
SHAREHOLDERS AND MARKETS
Major shareholders
The following table sets out information as of December 31,
2024 with respect to the beneficial ownership of ArcelorMittal
ordinary shares by each person who is known to be the
beneficial owner of more than 5% of the shares and all directors
and senior management as a group.
|
ArcelorMittal Ordinary Shares
|
|||
|
Number
|
%
|
||
|
Significant Shareholder
1
|
340,072,244
|
39.88
%
|
|
|
Treasury Shares
2
|
84,263,150
|
9.88
%
|
|
|
Other Public Shareholders
|
428,474,378
|
50.24
%
|
|
|
Total
|
852,809,772
|
100.00
%
|
|
|
Of which: Directors and Senior
Management
3
|
523,326
|
0.06
%
|
|
|
Significant Shareholder voting rights
(outstanding shares)
|
44.25
%
|
||
1
For purposes of this table, ordinary shares owned directly by Mr. Lakshmi N.
Mittal and his wife, Mrs. Usha Mittal, are aggregated with those ordinary
shares beneficially owned by the Significant Shareholder. At December 31,
2024, Mr. Lakshmi Mittal and his wife, Mrs. Usha Mittal, had direct ownership
of ArcelorMittal ordinary shares and beneficial ownership (within the meaning
set forth in Rule 13d-3 of the Exchange Act), through the Significant
Shareholder, of the outstanding equity of two holding companies that own
ArcelorMittal ordinary shares—Nuavam Investments S.à. r.l. (“Nuavam”) and
Lumen Investments S.à r.l. (“Lumen”). Nuavam, a limited liability company
organized under the laws of Luxembourg, was the owner of 63,658,348
ArcelorMittal ordinary shares. Lumen, a limited liability company organized
under the laws of Luxembourg, was the owner of 275,840,595 ArcelorMittal
ordinary shares. Mr. Lakshmi N. Mittal was the direct owner of
547,801
ArcelorMittal ordinary
shares
. Mrs. Mittal was the direct owner of 25,500
ArcelorMittal ordinary shares. Mr. Lakshmi N. Mittal, Mrs. Mittal and the
Significant Shareholder shared beneficial ownership of 100% of the
outstanding equity of each of Nuavam and Lumen (within the meaning set
forth in Rule 13d-3 of the Exchange Act). Accordingly, Mr. Lakshmi N. Mittal
was the beneficial owner of 340,046,744 ArcelorMittal ordinary shares, Mrs.
Mittal was the beneficial owner of 339,524,443 ordinary shares, and the
Significant Shareholder (when aggregated with ordinary shares of
ArcelorMittal held directly by Mr. and Mrs. Mittal) was the beneficial owner of
340,072,244 ordinary shares.
As of December 31, 2024, 2023 and 2022
, the
Significant Shareholder (together with Mr. Lakshmi N. Mittal and Mrs. Mittal)
held 39.88%, 39.87% and 37.65% of the Company’s ordinary shares
respectively.
2
Represents ArcelorMittal ordinary shares repurchased pursuant to share
repurchase programs, fractional shares returned in various transactions, and
the use of treasury shares in various transactions.
3
Includes shares beneficially owned by directors and members of senior
management listed in section "Management and employees—Directors and
senior managers" of this annual report; excludes shares beneficially owned
by Mr. Lakshmi N. Mittal. Note that ordinary shares included in this item are
included in “Other Public Shareholders” above.
Aditya Mittal is the direct owner of
352,069
ArcelorMittal ordinary
shares, representing less than 0.1% of the ArcelorMittal ordinary
shares outstanding and
holds PSUs see "Management and
employees—Compensation".
As the vesting of PSUs is
dependent on the Company's performance criteria not fully
within the control of the PSU holder, Aditya Mittal does not
beneficially own ArcelorMittal ordinary shares by virtue of his
ownership of the PSUs. Aditya Mittal is the son of Mr. Lakshmi
N. Mittal and Mrs. Mittal and is CEO and non-independent
director of ArcelorMittal. Vanisha Mittal Bhatia is the direct owner
of 8,500 ArcelorMittal ordinary shares, representing less than
0.1% of the ArcelorMittal ordinary shares outstanding. Vanisha
Mittal Bhatia is the daughter of Mr. Lakshmi N. Mittal and Mrs.
Mittal and a member of the Company’s Board of Directors.
The ArcelorMittal ordinary shares may be held in registered form
on the Company’s register only. Registered shares are fully
fungible and may consist of:
a.
ArcelorMittal Registry Shares, which are registered directly
on ArcelorMittal’s Luxembourg shareholder register,
b.
shares traded on Euronext Amsterdam, Euronext Paris,
the regulated market of the Luxembourg Stock Exchange
and the Spanish Stock Exchanges, which are held in
Euroclear, or
c.
shares traded on the NYSE, the ("New York Registry
Shares"), which are registered (including in the name of
the nominee of DTC) in a New York Share Register kept
on behalf of ArcelorMittal by Citibank N.A., its New York
transfer agent.
On January 19, 2022, BlackRock, Inc. provided a notification to
the Company stating that it beneficially owned 49,166,064
shares or 5.24% of ArcelorMittal’s issued shares as of January
18, 2022.
On February 4, 2022, BlackRock, Inc. filed a Schedule 13G/A
with the U.S. Securities and Exchange Commission stating that
it beneficially owned 52,460,418 shares or 5.3% of
ArcelorMittal’s issued shares as of December 31, 2021.
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On March 18, 2022, BlackRock, Inc. provided a notification to
the Company stating that it beneficially owned less than 5% of
ArcelorMittal’s issued shares as of March 15, 2022.
On May 24, 2022, BlackRock, Inc. provided a notification to the
Company stating that it beneficially owned 5.27% of
ArcelorMittal’s issued shares as of May 18, 2022.
On July 1, 2022, BlackRock, Inc. provided a notification to the
Company stating that it beneficially owned less than 5% of
ArcelorMittal’s issued shares as of June 30, 2022.
On August 9, 2022, BlackRock, Inc. filed a Schedule 13G/A with
the U.S. Securities and Exchange Commission stating that it
beneficially owned 43,446,535 shares or 4.9% of ArcelorMittal’s
issued shares as of July 31, 2022.
On April 25, 2023, BlackRock, Inc. provided a notification to the
Company stating that it beneficially owned 5% of ArcelorMittal’s
issued shares as of April 21, 2023.
On August 25, 2023, BlackRock, Inc. provided a notification to
the Company stating that it beneficially owned 5.68% of
ArcelorMittal’s issued shares as of August 23, 2023.
On September 18, 2023, BlackRock, Inc. provided notifications
to the Company stating that it beneficially owned 5.82% of
ArcelorMittal’s issued shares as of September 18, 2023.
On September 19, 2023, BlackRock, Inc. provided notifications
to the Company stating that it beneficially owned 5.83% of
ArcelorMittal’s issued shares as of September 19, 2023.
On October 31, 2023, BlackRock, Inc. provided notifications to
the Company stating that it beneficially owned 5.72% of
ArcelorMittal’s issued shares as of October 30, 2023.
On February 1, 2024, BlackRock, Inc. filed a Schedule 13G/A
with the U.S. Securities and Exchange Commission stating that
it beneficially owned 47,017,241 shares or 5.5% of
ArcelorMittal’s issued shares as of December 31, 2023.
On June 12, 2024, BlackRock, Inc. provided notifications to the
Company stating that it beneficially owned 4.99% of
ArcelorMittal’s issued shares as of June 10, 2024.
On July 8, 2024, BlackRock, Inc. filed a Schedule 13G/A with
the U.S. Securities and Exchange Commission stating that it
beneficially owned 41,376,250 shares or 4.9% of ArcelorMittal’s
issued shares.
On January 26, 2022, there was a notification from Société
Générale SA stating that it beneficially owned 44,777,728
shares or 4.88% of ArcelorMittal’s issued shares as of January
21, 2022.
These notifications (other than the Schedule 13G filings) are
available in the Luxembourg Stock Exchange’s OAM electronic
database on
www.bourse.lu
and on the Company’s website
corporate.arcelormittal.com under “Investors - Corporate
Governance - Shareholding structure”. The notifications were
published in reference to the Luxembourg law and the Grand
Ducal regulation of January 11, 2008, on transparency
requirements for issuers of securities ("Transparency Law") in
view of a shareholding notification going above or below the 5%
voting rights threshold. The Schedule 13G filings are available
on the website of the U.S. Securities and Exchange
Commission (www.sec.gov).
Under Luxembourg law, the ownership of registered shares is
evidenced by the inscription of the name of the shareholder, the
number of shares held by such shareholder and the amount
paid up on each share in the shareholder register of
ArcelorMittal.
At December 31, 2
024, 2,421 shareholders other than the
Significant Shareholder, holding an aggregate of 13,437,354
ArcelorMittal ordinary shares, were registered in ArcelorMittal’s
shareholder register, representing approximately 1.58% of the
ordinary shares issued (including treasury shares).
At December 31, 2024, there were 141 registered shareholders
holding an aggregate of 58,562,475 New York Registry Shares,
representing approximately 6.87%
of the ordinary shares issued
(including treasury shares). ArcelorMittal’s knowledge of the
number of New York Registry Shares held by U.S. holders is
based solely on the records of its New York transfer agent
regarding registered ArcelorMittal ordinary shares.
At December 31, 2024, 451,950,076 ArcelorMittal ordinary
shares were held through the Euroclear/Iberclear clearing
system in The Netherlands, France, Luxembourg and Spain,
representing approximately 53% of the ordinary shares issued
(including treasury shares
).
Voting rights
Each share entitles the holder to one vote at the general
meeting of shareholders, and no shareholder benefits from
special voting rights. For more information relating to
ArcelorMittal shares, see “Additional information—Memorandum
and Articles of Association—Voting and information rights”.
Management share ownership
As of December 31, 2024, the aggregate beneficial share
ownership of ArcelorMittal directors and senior management (18
individuals) totaled 523,326 ArcelorMittal shares (excluding
shares beneficially owned by the Significant Shareholder and
Mr. Lakshmi N. Mittal) representing 0.06% of the total issued
share capital of ArcelorMittal. Other than Mr. Lakshmi N. Mittal,
each director and member of senior management beneficially
owns less than 1% of ArcelorMittal’s shares. See "—Major
shareholders” for the beneficial share ownership of the
Significant Shareholder, Mr. Lakshmi Mittal, Mr. Aditya Mittal and
Ms. Vanisha Mittal Bhatia.
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In accordance with the Luxembourg Stock Exchange’s 10
Principles of Corporate Governance, independent non-executive
members of ArcelorMittal's Board of Directors do not receive
share options, RSUs or PSUs, and the policy of the Company is
not to grant any share-based remuneration to members of the
Board of Directors who are not executives of the Company.
See “Management and employees—Compensation” for a
description of options, RSUs and PSUs held by members of
ArcelorMittal’s senior management, including the Executive
Chairman and CEO.
The following tables summarize
outstanding
PSUs and RSUs granted to the members of the Executive Office and Executive Officers of
ArcelorMittal for the last five years as of December 31, 2024.
|
PSUs granted in 2024
|
PSUs granted in 2023
|
PSUs granted in 2022
|
PSUs granted in 2021
|
|
|
Executive Office
|
241,856
|
141,973
|
141,564
|
109,143
|
|
Term (in years)
|
3
|
3
|
3
|
3
|
|
Vesting date
1
|
January 1, 2028
|
January 1, 2027
|
January 1, 2026
|
January 1, 2025
|
1
See “Management and employees—Compensation—Remuneration—Long-term incentives plans”, for vesting conditions.
|
RSUs granted in
December 2024
|
PSUs granted in
December 2024
|
RSUs granted in
December 2023
|
PSUs granted in
December 2023
|
RSUs granted in
December 2022
|
PSUs granted in
December 2022
|
PSUs granted in
December 2021
|
|
|
CFO and
Other
Executive
Officers
|
70,400
|
302,100
|
54,800
|
233,100
|
41,500
|
113,900
|
89,200
|
|
Term (in years)
|
3
|
3
|
3
|
3
|
3
|
3
|
3
|
|
Vesting date
1
|
December 5, 2027
|
January 1, 2028
|
December 8, 2026
|
January 1, 2027
|
December 13, 2025
|
January 1, 2026
|
January 1, 2025
|
1
See note 8.3 to the consolidated financial statements, for vesting conditions.
See note 8.3 of the consolidated financial statements for a
description of ArcelorMittal’s equity-settled share-based
payments to certain employees, including RSUs and PSUs.
Related party transactions
ArcelorMittal engages in certain commercial and financial
transactions with related parties, including associates and joint
ventures of ArcelorMittal. Please refer to note 12 to the
consolidated financial statements. Further information related to
required disclosure of related party transactions under the
Shareholders’ Rights Law of August 1, 2019 implementing the
European Union's Shareholders' Rights Directive in Luxembourg
(the "Shareholders' Rights Law") is included in “Memorandum
and Articles of Association—Voting and information rights”.
Shareholder’s Agreement
Mr. Lakshmi Mittal and ArcelorMittal are parties to a shareholder
and registration rights agreement (the “Shareholder’s
Agreement”) dated August 13, 1997. Pursuant to the
Shareholder’s Agreement and subject to the terms and
conditions thereof, ArcelorMittal shall, upon the request of
certain holders of restricted ArcelorMittal shares, use its
reasonable efforts to register under the Securities Act of 1933,
as amended, the sale of ArcelorMittal shares intended to be sold
by those holders. By its terms, the Shareholder’s Agreement
may not be amended, other than for manifest error, except by
approval of a majority of ArcelorMittal’s shareholders (other than
the Significant Shareholder and certain permitted transferees) at
a general shareholders’ meeting.
Memorandum of Understanding
The Memorandum of Understanding entered into in connection
with the Mittal Steel acquisition of Arcelor, certain provisions of
which expired in August 2009 and August 2011, is described
under “Additional information—Material contracts—
Memorandum of Understanding”.
Agreements with Aperam SA post-Stainless Steel Spin-Off
In connection with the spin-off of its stainless steel division into a
separately focused company, Aperam SA (“Aperam”), which was
completed on January 25, 2011, ArcelorMittal entered into
several agreements with Aperam and/ or certain Aperam
subsidiaries which are still in force: a purchasing services
agreement for negotiation services from ArcelorMittal
Purchasing (the “Purchasing Services Agreement”) as well as
certain commitments regarding cost-sharing in Brazil and certain
other ancillary arrangements governing the relationship between
Aperam and ArcelorMittal following the spin-off, as well as
certain agreements relating to financing.
The parties agreed to renew a limited number of services where
expertise and bargaining power created value for each
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party. ArcelorMittal will continue to provide in 2025 (similar to
2024) certain services relating to areas including environmental
and technical support.
In the area of research and development at the time of the spin-
off, Aperam entered into a framework agreement with
ArcelorMittal in 2011, and as amended in 2015 to establish a
structure for future cooperation in relation to certain ongoing or
new research and development programs. Currently, few but
valuable research and development supports are implemented
through this agreement. New exchanges about breakthrough
technologies or possible technical developments interesting
both companies were launched between 2021 and 2024 and are
still ongoing.
I
n Europe, Aperam purchased most of its electricity and natural
gas through energy supply contracts put in place for the period
2014-2020 through ArcelorMittal Energy SCA. Electricity and
natural gas contracts were renewed in 2022 and for 2023 under
similar terms and conditions.
Electricity and natural gas supplies
continued in 2024 under the new conditions
described
in several
new contracts reflecting the supply practices throughout 2024;
contracts were signed in December 2024 effective from January
1, 2024 till January 1, 2026, extendable by mutual agreement
between the parties.
Regarding procurement, Aperam still relies on ArcelorMittal
Europe S.A. for supplies and services in relation to the
negotiation of certain contracts with global or large regional
suppliers. The Purchasing Services Agreement entered into on
January 25, 2011
has been renewed and remains in force in
relation to the following key categories: operating materials (only
hot strip mill), refractory materials, spare parts, sea freight,
logistics, industrial products and support services (excluding
industrial services). The Purchasing Services Agreement also
permits Aperam to avail itself of the services and expertise of
ArcelorMittal for certain capital expenditures.
Another commercial agreement in place between Aperam and
ArcelorMittal Sourcing is effective since January 2020 for the
sale of electrodes. Two specific IT service agreements are also
in place with Aperam, for the use in Europe and Brazil of Asset
Reliability Maintenance Program ("ARMP") and for the use of
the global wide area network (WAN).
Purchasing activities will continue to be provided to Aperam
pursuant to existing contracts with ArcelorMittal entities that it
has specifically elected to assume. In addition, since 2011, a
services agreement has been concluded between ArcelorMittal
Shared Service Center Europe Sp z.o.o. Sp.k. and Aperam for
accounting services.
In connection with the spin-off, management also renegotiated
an existing Brazilian cost-sharing agreement between
ArcelorMittal Brasil and Aperam Inox América do Sul S.A.,
Aperam Inox Serviços Brasil Ltda., Aperam Inox Tubos Brasil
Ltda. and Aperam Bioenergia Ltda. pursuant to which,
ArcelorMittal Brasil continued to perform purchasing for the
benefit of these Aperam’s Brazilian subsidiaries, with costs
being shared on the basis of cost allocation parameters agreed
between the parties on a yearly basis.
Share Repurchase Agreement
The Significant Shareholder has entered into a share
repurchase agreement with ArcelorMittal on February 12, 2021
(as amended from time to time), (the "Share Repurchase
Agreement"), to sell each trading day on which ArcelorMittal has
purchased shares under its 2021 share buyback programs (the
"Programs") an equivalent number of shares, at the proportion
of the then Significant Shareholder's stake in ArcelorMittal of
issued and outstanding shares of ArcelorMittal, at the same
price as the shares repurchased on the market. The effect of the
Share Repurchase Agreement was to maintain the Significant
Shareholder's voting rights in ArcelorMittal's issued share capital
(net of treasury shares) at the then-current level, pursuant to the
Programs.
ArcelorMittal announced the completion of five consecutive
Programs during 2021 under the authorization given by the
annual general meetings of shareholders held on June 13, 2020
and June 8, 2021. To maintain Significant Shareholder's current
level of voting rights as per the Share Repurchase Agreement,
in the context of five consecutive Programs, in totality the
Company repurchased, 62.2 million shares from the Significant
Shareholder for $1,878 million.
On February 11, 2022, ArcelorMittal announced a new $1 billion
share buyback program. To maintain Significant Shareholder's
current level of voting rights as per the Share Repurchase
Agreement, the Company repurchased 525,177 shares from the
Significant Shareholder for $16.2 million. On February 25, 2022,
the Company announced the decision of the Significant
Shareholder not to further participate to such program.
Accordingly, the Share Repurchase Agreement was terminated
with respect to this program.
Markets
ArcelorMittal shares are listed and traded (through a single
order book) on the Euronext European markets (Paris and
Amsterdam) (symbol “MT”), are admitted to trading on the
Luxembourg Stock Exchange’s regulated market and listed on
the Official List of the Luxembourg Stock Exchange (symbol
“MT”) and are listed and traded on the Spanish Stock
Exchanges (symbol “MTS”). In the United States, ArcelorMittal
shares are listed and traded on the NYSE (symbol “MT”).
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Paying agents
The paying agent for shareholders who hold shares listed on the
NYSE is Citibank and the paying agent for shareholders who
hold shares listed on Euronext Amsterdam, Euronext Paris, and
Luxembourg Stock Exchange is ABN AMRO.
New York Registry Shares
The Company does not hav
e any American Depositary
Receipts. As described under “Additional information—
Memorandum and Articles of Association—Form and transfer of
shares”, the Company maintains a New York share register with
Citibank, N.A. for its shares that trade on the NYSE. As of
December 31, 2024, 58,562,475 shares (or approximately
6.87%
of ArcelorMittal’s total issued shares) were ArcelorMittal
New York Registry Shares. Holders of ArcelorMittal New York
Registry Shares do not pay fees to Citibank as a general matter,
but do incur costs of up to $5 per 100 shares for transactions
that require canceling or issuing New York Registry Shares,
such as cross-border trades where New York Registry Shares
are cancelled in exchange for shares held in ArcelorMittal’s
European register, or vice-versa. Subject to certain conditions,
Citibank reimburses the Company on an annual basis for
expenses incurred by the Company in relation to the ongoing
maintenance of the New York share facility (e.g., investor
relations expenses, NYSE listing fees, etc.). In 2024, Citibank
paid the Company $293,881 in respect of reimbursements of
expenses incurred by the Company in 2024.
Dividend distributions
Based on Luxembourg law and its Articles of Association,
ArcelorMittal allocates at least five percent of its net profits to
the creation of a reserve. This allocation ceases to be
compulsory when the reserve reaches ten percent (10%) of its
issued share capital, and becomes compulsory once again
when the reserve falls below that percentage. Under
Luxembourg law, the amount of any dividends paid to
shareholders may not exceed the amount of the profits at the
end of the last financial year plus any profits carried forward and
any amounts drawn from reserves that are available for that
purpose, less any losses carried forward and sums to be placed
in reserve in accordance with Luxembourg law or the Articles of
Association. A company may not pay dividends to shareholders
when, on the closing date of the last financial year, the net
assets are, or following the payment of such dividend would
become, lower than the amount of the subscribed capital plus
the reserves that may not be distributed by law or by virtue of
the articles of association. ArcelorMittal’s Articles of Association
provide that the portion of annual net profit that remains
unreserved is allocated as follows by the general meeting of
shareholders upon the proposal of the Board of Directors:
•
a global amount is allocated to the Board of Directors by
way of directors’ fees (“tantièmes”). This amount may not
be less than €1,000,000. In the event that the profits are
insufficient, the amount of €1,000,000 shall be imputed in
whole or in part to charges. The distribution of this amount
among the members of the Board of Directors shall be
effected in accordance with the Board of Directors’ rules of
procedure; and
•
the balance is distributed as dividends to the shareholders
or placed in the reserves or carried forward.
Interim dividends may be distributed under the conditions set
forth in Luxembourg law by decision of the Board of Directors.
No interest is paid on dividends declared but not paid which are
held by the Company on behalf of shareholders.
Following the achievement of the Group's net debt target, in
February 2021, the Board approved a new capital return policy.
See under “History and development of the Company—Other
information—Capital return policy”.
In February 2022, the Board of Directors recommended an
increase of the base annual dividend to $0.38/share, from
$0.30/share which was approved on May 4, 2022 at the annual
general meeting of shareholders. The dividend amounted to
$332 million and was paid on June 10, 2022.
In February 2023, the Board of Directors recommended an
increase of the base annual dividend from $0.38/share to $0.44/
share, which was approved on May 2, 2023 at the annual
general meeting of shareholders. The dividend amounted to
$369 million.
In February 2024, the Board of Directors recommended an
increase of the base annual dividend to $0.50/share (from
$0.44/share paid in 2023), which was approved on April 30,
2024 at the annual general meeting of shareholders. The
dividend amounted to $393 million.
In February 2025, the Board of Directors recommended an
increase of the base annual dividend to $0.55/share (from
$0.50/share paid in 2024), subject to the approval of
shareholders at the annual general meeting of shareholders in
May 2025.
Purchases of equity securities by the issuer and affiliated
purchasers
On May 5, 2023, the Company announced a share buyback
program of up to 85 million shares to be completed by May 2025
(subject to market conditions) pursuant to the authorization of
the AGM held on May 2, 2023 ("2023 buyback program"), which
remains outstanding as of the date of this annual report. At
December 31, 2024, ArcelorMittal had repurchased
approximately
78.2
million shares representing approximately
92% of the current share buyback program for a total value of
$2.0 billion.
See “Introduction—History and development of the Company—
Additional information”.
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As described in “Memorandum and Articles of Association”, the
maximum number of shares that may be acquired does not in
any event exceed 10% of the Company’s issued share capital.
The maximum number of own shares that the Company may
hold at any time directly or indirectly may not have the effect of
reducing its net assets (“actif net”) below the amount mentioned
in paragraphs 1 and 2 of Article 461-272-1 of the Law
.
|
Program
1
|
2024
|
Total Number of
Shares Purchased
|
Average Price
Paid Per Share
|
Total Number of
Shares Purchased as
Part of Publicly
Announced Plan or
Program
|
Maximum Number of
Shares that may yet
be purchased under
the Plans or Programs
(see above
explanations)
|
|
2023 buyback program
|
January 1 - January 31
|
6,187,597
|
$
27.07
|
6,187,597
|
52,561,349
|
|
2023 buyback program
|
February 1 - February 29
|
6,215,530
|
$
26.80
|
6,215,530
|
46,345,819
|
|
2023 buyback program
|
March 1 - March 31
|
10,121,676
|
$
26.27
|
10,121,676
|
36,224,143
|
|
2023 buyback program
|
April 1 - April 30
|
—
|
—
|
—
|
36,224,143
|
|
2023 buyback program
|
May 1 - May 31
|
4,300,000
|
$
25.93
|
4,300,000
|
31,924,143
|
|
2023 buyback program
|
June 1 - June 30
|
7,863,499
|
$
23.97
|
7,863,499
|
24,060,644
|
|
2023 buyback program
|
July 1 - July 31
|
4,343,776
|
$
23.02
|
4,343,776
|
19,716,868
|
|
2023 buyback program
|
August 1 - August 31
|
5,866,654
|
$
22.00
|
5,866,654
|
13,850,214
|
|
2023 buyback program
|
September 1 - September 30
|
1,715,641
|
$
22.02
|
1,715,641
|
12,134,573
|
|
2023 buyback program
|
October 1 - October 31
|
—
|
—
|
—
|
12,134,573
|
|
2023 buyback program
|
November 1 - November 30
|
3,124,103
|
$
24.77
|
3,124,103
|
9,010,470
|
|
2023 buyback program
|
December 1 - December 31
|
2,218,911
|
$
25.06
|
2,218,911
|
6,791,559
|
1.
Commencement of 2023 buyback program was announced on May 5, 2023 for up to 85 million shares. The Company repurchased 26.2 million shares in 2023 for an
aggregate amount of $652 million. See “Introduction—History and development of the Company—Additional information”. As of December 31, 2024, the 2023 buyback
program was not yet completed.
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Share capital
As of December 31, 2024, the Company’s issued share capital
amounted to $303 million, represented by
852,80
9,77
2
ordinary
shares without nominal value. The Company's issued share
capital changed as described below in 2022 and 2023.
Out of the total of
852,809,772
shares in issue, 84,263,150
shares were held in treasury by ArcelorMittal at December 31,
2024, representing 9.88% of its issued share capital.
The Company’s authorized share capital, including the issued
share capital, was $395 million, represented by 1,111,418,599
ordinary shares without nominal value as of December 31,
2024. The Company's authorized share capital changed as
described below in 2022 an
d 2023.
On May 19, 2023, upon mandatory conversion of the remaining
24,290,025
outstanding mandatorily convertible subordinated
notes issued on May 18, 2020 and due May 18, 2023,
ArcelorMittal delivered a total of
57,057,991
treasury shares (of
which
9,396,120
to the Significant Shareholder). See note 11.2
to the consolidated financial statements.
In line with the authorization granted by the EGM of ArcelorMittal
shareholders held on
May 4, 2022
and May 2, 2023, the Board
of Directors decided to keep the number of treasury shares
within appropriate levels by cancelling:
(i) on January 14, 2022, 45 million treasury shares. As a result
of this cancellation, ArcelorMittal had 937,809,772 shares in
issue (compared to 982,809,772 before cancellation);
(ii) on May 18, 2022, 60 million treasury shares. As a result of
this cancellation, ArcelorMittal had 877,809,772 shares in issue
(compared to 937,809,772 before cancellation); and
(iii) on April 28, 2023, 25 million treasury shares. As a result of
such cancellation, ArcelorMittal has 852,809,772 shares in issue
(compared to 877,809,772 before the
cancellation
).
The
cancellations
took into account the $1 billion share buyback
announced on November 17, 2021, which was completed on
December 28, 2021, the $1 billion share buyback announced on
May 5, 2022, which was completed on June 8, 2022 and
the
60,431,380 share buyback announced on July 29, 2022 which
was completed on March 31, 2023.
Over the years, ArcelorMittal has issued equity-settled share-
based payments to certain employees, including stock options,
restricted share units and performance share units. See note 8.3
to the consolidated financial statements.
ADDITIONAL INFORMATION
Memorandum and Articles of Association
Below is a summary of ArcelorMittal’s Articles of Association and
certain legal provisions and internal policies applicable to
ArcelorMittal. The full text of the Company’s Articles of
Association is also available on www.arcelormittal.com under
“Investors-Corporate Governance-Current-Articles of
Association” and as filed under Exhibit 1.1 to this annual report
on Form 20-F.
Corporate purpose
Article 3 of the Articles of Association provides that the corporate
purpose of ArcelorMittal is the manufacture, processing and
marketing of steel, steel products and all other metallurgical
products, as well as all products and materials used in their
manufacture, their processing and their marketing, and all
industrial and commercial activities connected directly or
indirectly with those objects, including mining and research
activities and the creation, acquisition, holding, exploitation and
sale of patents, licenses, know-how and, more generally,
intellectual and industrial property rights.
The Company may realize its corporate purpose either directly
or through the creation of companies, the acquisition, holding or
acquisition of interests in any companies or partnerships,
membership in any associations, consortia and joint ventures.
In general, the Company’s corporate purpose comprises the
participation, in any form whatsoever, in companies and
partnerships and the acquisition by purchase, subscription or in
any other manner as well as the transfer by sale, exchange or in
any other manner of shares, bonds, debt securities, warrants
and other securities and instruments of any kind.
It may grant assistance to any affiliated company and take any
measure for the control and supervision of such companies.
It may carry out any commercial, financial or industrial operation
or transaction that it considers to be directly or indirectly
necessary or useful in order to achieve or further its corporate
purpose.
Form and transfer of shares
The shares of ArcelorMittal are issued in registered form only
and are freely transferable. There are no restrictions on the
rights of Luxembourg or non-Luxembourg residents to own
ArcelorMittal shares.
ABN AMRO assists the Company with certain administrative
tasks relating to the day-to-day administrative management of
the shareholders' register. The Company maintains a New York
shareholders' register with Citibank, N.A. (located at 388
Greenwich Street, New York, New York 10013) for its New York
Registry Shares that trade on the NYSE with underlying
positions held in Euroclear. As of December 31, 2024,
58,562,475 shares (or approximately 6.87% of ArcelorMittal's
total issued shares) were New York Registry Shares.
For more details, see “Description of the Registrant’s Securities
Registered Pursuant to Section 12 of the Securities Exchange
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Act of 1934” as filed under Exhibit 2.2 to this annual report on
Form 20-F.
Issuance and Repurchase of shares
The issuance of shares by ArcelorMittal requires either an
amendment of the Articles of Association approved by an EGM
or a decision of the Board of Directors that is within the limits of
the authorized share capital set out in the Articles of Association.
While Luxembourg law prohibits ArcelorMittal from subscribing
for its own shares, subject to certain conditions, it can
repurchase its own shares or have another person repurchase
shares on its behalf. For more details, see “Description of the
Registrant’s Securities Registered Pursuant to Section 12 of the
Securities Exchange Act of 1934” as filed under Exhibit 2.2 to
this annual report on Form 20-F.
Preemptive rights
Unless limited or canceled by the Board of Directors as
described in the Articles of Association or by an EGM, holders of
ArcelorMittal shares have a pro rata preemptive right to
subscribe for newly issued shares, except for shares issued for
consideration other than cash (i.e., in kind).
For more details,
see “Description of the Registrant’s Securities Registered
Pursuant to Section 12 of the Securities Exchange Act of 1934”
as filed under Exhibit 2.2 to this annual report on Form 20-F.
Capital reduction
The Articles of Association provide that the issued share capital
of ArcelorMittal may be reduced subject to the approval of at
least two-thirds of the votes cast at an extraordinary general
meeting of shareholders where, at first call, at least 50% of the
issued share capital is required to be represented, with no
quorum being required at a reconvened meeting.
Please refer to the section on “Shareholder and markets - Share
capital” for the details on the latest share capital reductions.
General meeting of shareholders
The shareholders’ rights law of May 24, 2011, which transposes
into Luxembourg law Directive 2007/36/EC of the European
Parliament and of the Council of July 11, 2007 (on the exercise
of certain rights of shareholders in listed companies) as
amended (the “Shareholders' Rights Law”) includes provisions
relating to general meetings of shareholders, as discussed
below.
General meetings of shareholders are convened by the
publication of a notice at least 30 days before the meeting date
in a Luxembourg newspaper, via the online platform called
Recueil électronique des sociétés et associations
(“RESA”), and
by way of press release sent to the major news agencies.
Ordinary general meetings are not subject to any minimum
shareholder participation level. Extraordinary general meetings,
however, are subject to a minimum quorum of 50% of the share
capital. In the event the 50% quorum is not met upon the first
call, the meeting may be reconvened by way of convening
notice published in the same manner as the first notice, at least
17 days before the meeting date. No quorum is required upon
the second call.
Shareholders whose share ownership is directly registered in
the shareholders’ register of the Company must receive the
convening notice by regular mail, unless they have accepted to
receive it through other means (i.e., electronically). In addition,
all materials relating to a general meeting of shareholders must
be made available on the website of ArcelorMittal from the first
date of publication of the convening notice.
The Shareholders’ Rights Law abolished the blocking period
and introduced the record date system into Luxembourg law. As
set out in the Articles of Association, the record date applicable
to ArcelorMittal is the 14th day at midnight before the general
meeting date. Only the votes of shareholders who are
shareholders of the Company on the record date will be taken
into account, regardless of whether they remain shareholders on
the general meeting date. Shareholders who intend to
participate in the general meeting must notify the Company at
the latest on the date indicated in the convening notice of their
intention to participate (by proxy or in person).
Ordinary general meetings of shareholders
.
At an ordinary general meeting of shareholders there is no
quorum requirement and resolutions are adopted by a simple
majority, irrespective of the number of shares represented.
Ordinary general meetings deliberate on any matter that does
not require the convening of an extraordinary general meeting.
The Articles of Association provide that the annual general
meeting of shareholders is held each year within six months
from the end of the previous financial year at the Company’s
registered office or at any other place in the Grand Duchy of
Luxembourg as determined by the Board of Directors and
indicated in the convening notice.
Extraordinary general meetings of shareholders.
An extraordinary general meeting must be convened to
deliberate on the following types of matters:
•
an increase or decrease of the authorized or issued
share capital,
•
a limitation or exclusion of existing shareholders’
preemptive rights,
•
the acquisition by any person of 25% or more of the
issued share capital of ArcelorMittal,
•
approving a merger or similar transaction such as a
spin-off, and
•
any transaction or matter requiring an amendment of
the Articles of Association.
The extraordinary general meeting must reach a quorum of
shares present or represented at the meeting of 50% of the
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share capital in order to validly deliberate. If this quorum is not
reached, the meeting may be reconvened and the second
meeting will not be subject to any quorum requirement. In order
to be adopted by the extraordinary general meeting (on the first
or the second call), any resolution submitted must be approved
by at least two-thirds of the votes cast except for certain limited
matters where the Articles of Association require a higher
majority (see “—Amendment of the Articles of Association”).
Votes cast do not include votes attaching to shares with respect
to which the shareholder has not taken part in the vote, has
abstained or has returned a blank or invalid vote.
In addition, Luxembourg law requires the Board of Directors to
convene a general meeting of shareholders if shareholders
representing in the aggregate 10% of the issued share capital
so require in writing with an indication of the requested agenda.
In this case, the general meeting of shareholders must be held
within one month of the request. If the requested general
meeting of shareholders is not so convened, the relevant
shareholder or group of shareholders may petition the
competent court in Luxembourg to have a court appointee
convene the general meeting.
Shareholder participation at general meetings
The Board of Directors may decide to arrange for shareholders
to be able to participate in the general meeting by electronic
means by way, among others, of (i) real-time transmission to
the public of the general meeting, (ii) two-way communication
enabling shareholders to address the general meeting from a
remote location, or (iii) a mechanism allowing duly identified
shareholders to cast their votes before or during the general
meeting without the need for them to appoint a proxyholder who
would be physically present at the meeting.
A shareholder may act at any general meeting of shareholders
by appointing another person (who need not be a shareholder)
as his or her attorney by means of a written proxy using the form
made available on the website of the Company. The completed
and signed proxy must be sent to the Company in accordance
with the instructions set out in the convening notice.
The Board of Directors may also decide to allow shareholders to
vote by correspondence by means of a form providing for a
positive or negative vote or an abstention on each agenda item.
The conditions for voting by correspondence are set out in the
Articles of Association and in the convening notice.
Shareholders representing in the aggregate 5% of the issued
share capital may also request that additional items be added to
the agenda of a general meeting and may draft alternative
resolutions to be submitted to the general meeting regarding
existing agenda items. The request must be made in writing and
sent either to the electronic address or to the Company’s postal
address set out in the convening notice.
The Shareholders’ Rights Law provides that a company’s
articles of association may allow shareholders to ask questions
prior to the general meeting which will be answered by
management during the general meeting’s questions and
answers session prior to the vote on the agenda items. Although
the Articles of Association do not specifically address this point,
shareholders may ask questions in writing ahead of a general
meeting, which are taken into account in preparing the general
meeting’s questions and answers session. With regard to the
April 30, 2024 general meetings, shareholders could also send
questions to the Company in advance by writing to a dedicated
e-mail address indicated in the convening notice. The Company
on a best efforts basis provided responses to the questions
during the general meeting Q&A session.
Identification of shareholders
Pursuant to the Shareholders’ Rights Law, listed companies now
have the ability to identify their shareholders and ultimately
improve communication between them and their shareholders.
Intermediaries, including those in third countries, are required to
provide the Company with information to enable the
identification of shareholders. Intermediaries in-scope of the
Shareholders' Rights Law are investment firms, credit
institutions and central securities depositories which provide
share safekeeping or administration of securities accounts or
maintenance services to shareholders or other persons. Third
country in-scope intermediaries are those which provide these
services to shareholders or other intermediaries with respect to
shares in the Company and are located outside of the European
Union.
Voting and information rights
Each share entitles the shareholder to attend a general meeting
of shareholders in person or by proxy and to vote. There are no
restrictions on the rights of Luxembourg or non-Luxembourg
residents to vote. For more details, see “Description of the
Registrant’s Securities Registered Pursuant to Section 12 of the
Securities Exchange Act of 1934” as filed under Exhibit 2.2 to
this annual report on Form 20-F.
Election and removal of directors
Members of the Board of Directors are elected by simple
majority of the represented shareholders at an ordinary general
meeting of shareholders. Directors are elected for a period
ending on a date determined at the time of their appointment.
The directors of ArcelorMittal are elected for three-year terms in
staggered intervals. Any director may be removed with or
without cause by a simple majority vote at any general meeting
of shareholders.
(a) a director’s power to vote on a proposal, arrangement or
contract in which the director is materially interested;
If a Director has directly or indirectly a financial interest in a
transaction that is submitted to the Board of Directors for
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approval and this interest conflicts with that of ArcelorMittal
(other than transactions which are ordinary business operations
and are entered into under normal conditions), the Director must
advise the Board of Directors of the existence and nature of the
conflict and cause a record of his/her statement to be included
in the minutes of the meeting. In addition, the Director may not
take part in the discussions on and may not vote on the relevant
transaction and he or she shall not be counted for the purposes
of whether the quorum is present, in which case the Board of
Directors may validly deliberate if at least the majority of the
non-conflicted directors are present or represented. At the next
following general meeting of shareholders of ArcelorMittal,
before any other resolution is put to a vote, a special report will
be made by the Board of Directors to the shareholders’ meeting
on any such transaction.
If a material transaction with a related party involves a Director,
that Director may not participate in the approval of such
transaction.
(b) the directors’ power, in the absence of an independent
quorum, to vote compensation to themselves or any members of
their body;
The remuneration of the Directors is determined each year by
the annual general meeting of shareholders subject to Article 17
of the Articles of Association. The annual shareholders meeting
of the Company decides on the directors’ remuneration. The
Executive Chairman is not remunerated for his membership on
the Board of Directors. The remuneration of the Executive
Chairman is determined by the Board’s ARCG Committee,
which consists solely of independent directors. For more
information, see “Management and employees—
Compensation”.
Pursuant to the Shareholders’ Rights Law, the shareholders
must be informed in detail of the remuneration of the members
of the Company's Board of Directors and its CEO and the
company's remuneration policy. Companies must prepare a
management remuneration policy describing all components,
criteria, methods and modalities applied to determine the fixed
and variable remuneration of such persons. Such remuneration
policy must contribute to the Company's business strategy and
long-term interests. It must be resubmitted to an advisory vote at
the general meeting of shareholders for approval each time
there is a significant change thereto and at least every four
years. In addition, companies must prepare a remuneration
report for the annual general meeting on the remuneration and
benefits granted to directors, and such remuneration report is
required to be submitted for an advisory vote at the general
meeting of shareholders each year.
(c) borrowing powers exercisable by the directors and how such
borrowing powers can be varied;
Any transaction between ArcelorMittal or a subsidiary of
ArcelorMittal and a Director (or an affiliate of a Director) must be
conducted on arm’s length terms and, if material, must obtain
the approval of the Independent Directors.
(d) retirement or non-retirement of directors under an age limit
requirement
There is no retirement or non-retirement of directors under an
age limit requirement. However
,
on October 30, 2012, the Board
of Directors adopted a policy that places limitations on the terms
of independent directors as well as the number of directorships
Directors may hold in order to align the Company’s corporate
governance practices with best practices in this area. The policy
provides that an independent director may not serve on the
Board of Directors for more than 12 consecutive years, although
the Board of Directors may, by way of exception to this rule,
make an affirmative determination, on a case-by-case basis,
that he or she may continue to serve beyond the 12 years rule if
the Board of Directors considers it to be in the best interest of
the Company based on the contribution of the Director involved
and the balance between the knowledge, skills, experience and
need for renewal of the Board.
(e) number of shares, if any, required for director’s qualification.
Article 8.2 of the Articles of Association states that the members
of the Board of Directors do not have to be shareholders in the
Company. However, the Board of Directors introduced on
October 30, 2012 (as amended on November 7, 2017) a policy
that requires members of the Board of Directors to hold 4,000
shares in the Company (6,000 for the Lead Independent
Director). For more information, see “Management and
employees—Corporate governance—Specific characteristics of
the director role”.
ArcelorMittal’s Articles of Association provide that the Significant
Shareholder is entitled to nominate a number of candidates for
election by the shareholders to the Board of Directors in
proportion to its shareholding. The Significant Shareholder has
not exercised this right to date.
Amendment of the Articles of Association
Any amendments to the Articles of Association must be
approved by an extraordinary general meeting of shareholders
held in the presence of a Luxembourg notary, followed by the
publications required by Luxembourg law.
In order to be adopted, amendments of the Articles of
Association relating to the size and the requisite minimum
number of independent and non-executive directors of the
Board of Directors, the composition of the Audit & Risk
Committee, and the nomination rights to the Board of Directors
of the Significant Shareholder require a majority of votes
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representing two-thirds of the voting rights attached to the
shares in ArcelorMittal. The same majority rule would apply to
amendments of the provisions of the Articles of Association that
set out the foregoing rule.
Annual accounts
Each year before submission to the annual ordinary general
meeting of shareholders, the Board of Directors approves the
stand-alone audited financial statements for ArcelorMittal, the
parent company of the ArcelorMittal group as well as the
consolidated financial statements of the ArcelorMittal group,
each of which are prepared in accordance with IFRS. The Board
of Directors also approves the management reports on each of
the stand-alone audited financial statements and the
consolidated financial statements, and in respect of each of
these sets of accounts a report must be issued by the
independent auditors.
The stand-alone audited financial statements, the consolidated
financial statements, the management reports and the auditor’s
reports will be available on request from the Company and on
the Company’s website from the date of publication of the
convening notice for the annual ordinary general meeting of
shareholders.
The stand-alone audited financial statements and the
consolidated financial statements, after their approval by the
annual ordinary general meeting of shareholders, are filed with
the Luxembourg Register of Commerce and Companies.
Dividends
Except for shares held in treasury by the Company, each
ArcelorMittal share is entitled to participate equally in dividends
if and when declared out of funds legally available for such
purposes. For more details, see “Description of the Registrant’s
Securities Registered Pursuant to Section 12 of the Securities
Exchange Act of 1934” as filed under Exhibit 2.2 to this annual
report on Form 20-F.
Merger and division
A merger whereby the Luxembourg company being acquired
transfers to an existing or newly incorporated Luxembourg
company all of its assets and liabilities in exchange for the
issuance to the shareholders of the company being acquired of
shares in the acquiring company, and a division whereby a
company (the company being divided) transfers all its assets
and liabilities to two or more existing or newly incorporated
companies in exchange for the issuance of shares in the
beneficiary companies to the shareholders of the company
being divided or to such company, and certain similar
restructurings must be approved by an extraordinary general
meeting of shareholders of the relevant companies held in the
presence of a notary. These transactions require the approval of
at least two-thirds of the votes cast at a general meeting of
shareholders of each of the companies where at least 50% of
the share capital is represented upon first call, with no such
quorum being required at a reconvened meeting.
For more details, see “Description of the Registrant’s Securities
Registered Pursuant to Section 12 of the Securities Exchange
Act of 1934” as filed under Exhibit 2.2 to this annual report on
Form 20-F.
Liquidation, Mandatory bid—squeeze-out right—sell-out right
See “Description of the Registrant’s Securities Registered
Pursuant to Section 12 of the Securities Exchange Act of 1934”
as filed under Exhibit 2.2 to this annual report on Form 20-F.
Disclosure of significant ownership in ArcelorMittal shares
Holders of ArcelorMittal shares and derivatives or other financial
instruments linked to ArcelorMittal shares may be subject to the
notification obligations of the Luxembourg law of January 11,
2008, as amended, on transparency requirements regarding
information about issuers whose securities are admitted to
trading on a regulated market. For more details, see
“Description of the Registrant’s Securities Registered Pursuant
to Section 12 of the Securities Exchange Act of 1934” as filed
under Exhibit 2.2 to this annual report on Form 20-F.
Disclosure of insider dealing transactions
Members of the Board of Directors and the members of the
Executive Office, Executive Officers and other executives
fulfilling senior management responsibilities within ArcelorMittal
and falling with the definition of “Persons Discharging Senior
Managerial Responsibilities” set out below and persons closely
associated with them must disclose to the CSSF and to
ArcelorMittal all transactions relating to shares or debt
instruments of ArcelorMittal or derivatives or other financial
instruments linked to any shares or debt instruments of
ArcelorMittal (together the “Financial Instruments”) conducted by
them or for their account. Such notifications shall be made
promptly and not later than three business days after the date of
the transaction.
“Persons Discharging Senior Managerial Responsibilities” within
ArcelorMittal are the members of the Board of Directors, and the
Executive Office, the Executive Officers, and other executives
occupying a high level management position with regular access
to non-public material information relating, directly or indirectly,
to ArcelorMittal and have the authority to make management
decisions about the future development of the Company and its
business strategy (see “Management and employees—
Directors and senior management" for a description of senior
management). Persons closely associated with them include
their respective family members.
Both information on trading in Financial Instruments by “Persons
Discharging Senior Managerial Responsibilities” and
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ArcelorMittal’s Insider Dealing Regulations are available on
www.arcelormittal.com
under “Investors—Corporate
Governance—Share Transactions by Management”. For more
information, see “Management and employees—Directors and
senior management”. In 2024, eight notifications were received
by ArcelorMittal from such persons and filed with the CSSF.
Related Party Transactions
The Shareholders’ Rights Law provides that a company is now
required to publicly disclose material transactions (excluding
"transactions taking place as part of the company's ordinary
activity and concluded under normal market conditions") with
related parties no later than at the time of conclusion of the
transaction. The same requirement applies to material
transactions concluded between related parties of a company
and subsidiaries of such company. The Board of Directors
must approve material transactions of the Company with related
parties. A transaction with a related party is material if (i) its
publication and divulgation may have a significant impact on the
economic decisions of shareholders and (ii) it may create a risk
for the company and its shareholders which are not related
parties, including minority shareholders. In the determination of
whether a transaction is material both the nature of the
transaction and the position of the related party must be taken
into account.
Publication of regulated information
Since January 2009, disclosure to the public of “regulated
information” (within the meaning of the Luxembourg
Transparency Law) concerning ArcelorMittal has been made by
publishing the information through the centralized regulated
information filing and storage system managed by the
Luxembourg Stock Exchange and accessible in English and
French on
www.luxse.com,
in addition to the publication by
ArcelorMittal of the information by way of press release. All
news and press releases issued by the Company are available
on www.arcelormittal.com
in the “News and Media” section.
Limitation of directors’ liability/indemnification of Directors and
the members of the Executive Office
The Articles of Association provide that ArcelorMittal will, to the
broadest extent permitted by Luxembourg law, indemnify every
director and member of the Executive Office as well as every
former director or member of the Executive Office for fees, costs
and expenses reasonably incurred in the defense or resolution
(including a settlement) of all legal actions or proceedings,
whether civil, criminal or administrative, he or she has been
involved in his or her role as former or current director or
member of the Executive Office.
The right to indemnification does not exist in the case of gross
negligence, fraud, fraudulent inducement, dishonesty or for a
criminal offense, or if it is ultimately determined that the director
or members of the Executive Office has not acted honestly, in
good faith and with the reasonable belief that he or she was
acting in the best interests of ArcelorMittal.
The Company also maintains liability insurance for its directors
and officers, including insurance against liabilities arising under
the U.S. Securities Act of 1933, as amended, and the U.S.
Securities Exchange Act of 1934, as amended.
Material contracts
The following are material contracts, not entered into in the
ordinary course of business, to which ArcelorMittal has been a
party during the past two years.
ArcelorMittal Equity Incentive Plan, Performance Share Unit
Plan and Special Grant
For a description of such plans, please refer to “Management
and employees—Compensation.”
Memorandum of Understanding
Mr. Lakshmi Mittal, Mrs. Usha Mittal, Lumen Investments S.à r.l.,
Nuavam Investments S.à r.l. (together, the “MoU Group”) and
the Company are parties to a Memorandum of Understanding
(“MoU”), dated June 25, 2006, to combine Mittal Steel and
Arcelor in order to create the world’s leading steel company.
(Lumen Investments S.à r.l. and Nuavam Investments S.à r.l.
became parties following the assumption of the obligations of
original parties to the MoU that have since ceased to hold
Company shares). In April 2008, the Board of Directors
approved resolutions amending certain provisions of the MoU in
order to adapt it to the Company’s needs in the post-merger and
post-integration phase, as described under “Management and
employees—Corporate governance—Operation—Lead
Independent Director”.
On the basis of the MoU, Arcelor’s Board of Directors
recommended Mittal Steel’s offer for Arcelor, and the parties to
the MoU agreed to certain corporate governance and other
matters relating to the combined ArcelorMittal group. Certain
provisions of the MoU relating to corporate governance were
incorporated into the Articles of Association of ArcelorMittal at
the extraordinary general meeting of the shareholders on
November 5, 2007.
Certain additional provisions of the MoU expired effective
August 1, 2009 and on August 1, 2011. ArcelorMittal’s corporate
governance rules will continue to reflect, subject to those
provisions of the MoU that have been incorporated into the
Articles of Association, the best standards of corporate
governance for comparable companies and to conform with the
corporate governance aspects of the NYSE listing standards
applicable to non-U.S. companies and Ten Principles of
Corporate Governance of the Luxembourg Stock Exchange.
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The following summarizes the main provisions of the MoU that
remain in effect or were in effect in 2024.
Standstill
The MoU Group agreed not to acquire, directly or indirectly,
ownership or control of an amount of shares in the capital stock
of the Company exceeding the percentage of shares in the
Company that it will own or control following completion of the
Offer (as defined in the MoU) for Arcelor and any subsequent
offer or compulsory buy-out, except with the prior written
consent of a majority of the independent directors on the
Company’s Board of Directors. Any shares acquired in violation
of this restriction will be deprived of voting rights and shall be
promptly sold by the MoU Group. Notwithstanding the above, if
(and whenever) the MoU Group holds, directly and indirectly,
less than 45% of the then-issued Company shares, the MoU
Group may purchase (in the open market or otherwise)
Company shares up to such 45% limit. In addition, the MoU
Group is also permitted to own and vote shares in excess of the
threshold mentioned in the immediately preceding paragraph or
the 45% limit mentioned above, if such ownership results from
(1) subscription for shares or rights in proportion to its existing
shareholding in the Company where other shareholders have
not exercised the entirety of their rights or (2) any passive
crossing of this threshold resulting from a reduction of the
number of Company shares (e.g., through self-tender offers or
share buy-backs) if, in respect of (2) only, the decisions to
implement such measures were taken at a shareholders’
meeting in which the MoU Group did not vote or by the
Company’s Board of Directors with a majority of independent
directors voting in favor.
Once the MoU Group exceeds the threshold mentioned in the
first paragraph of this “Standstill” subsection or the 45% limit, as
the case may be, as a consequence of any corporate event set
forth in (1) or (2) above, it shall not be permitted to increase the
percentage of shares it owns or controls in any way except as a
result of subsequent occurrences of the corporate events
described in (1) or (2) above, or with the prior written consent of
a majority of the independent directors on the Company’s Board
of Directors.
If subsequently the MoU Group sells down below the threshold
mentioned in the first paragraph of this “Standstill” subsection or
the 45% limit, as the case may be, it shall not be permitted to
exceed the threshold mentioned in the first paragraph of this
“Standstill” subsection or the 45% limit, as the case may be,
other than as a result of any corporate event set out in (1) or
(2) above or with the prior written consent of a majority of the
independent directors.
Finally, the MoU Group is permitted to own and vote shares in
excess of the threshold mentioned in the first paragraph of this
“Standstill” subsection or the 45% limit mentioned above if it
acquires the excess shares in the context of a takeover bid by a
third party and (1) a majority of the independent directors of the
Company’s Board of Directors consents in writing to such
acquisition by the MoU Group or (2) the MoU Group acquires
such shares in an offer for all of the shares of the Company.
Non-compete
For so long as the MoU Group holds and controls at least 15%
of the outstanding shares of the Company or has
representatives on the Company’s Board of Directors or
Executive Office, the MoU Group and its affiliates will not be
permitted to invest in, or carry on, any business competing with
the Company, except for PT ISPAT Indo.
Exchange controls and other limitations affecting security
holders
There are no legislative or other legal provisions currently in
force in Luxembourg or arising under ArcelorMittal’s Articles of
Association that restrict the payment of dividends to holders of
ArcelorMittal shares not resident in Luxembourg, except for
regulations restricting the remittance of dividends and other
payments in compliance with United Nations and EU sanctions.
There are no limitations, either under the laws of Luxembourg or
in the Articles of Association, on the right of non-Luxembourg
nationals to hold or vote ArcelorMittal shares.
Luxembourg takeover law disclosure
The following disclosure is provided based on article 11 of the
Luxembourg law of May 19, 2006 transposing Directive
2004/25/EC of the European Parliament and the Council of April
21, 2004 on takeover bids (the “Takeover Law”). The Articles of
Association are available on www.arcelormittal.com, under
Investors, Corporate Governance, Current Articles of
Association.
With regard to articles 11(1)(a) and (c) of the Takeover Law, the
Company has issued a single category of shares (ordinary
shares), and the Company’s shareholding structure showing
each shareholder owning 5% or more of the Company’s share
capital is available elsewhere in this report and on
www.arcelormittal.com under Investors, Corporate Governance,
Shareholding Structure, where the shareholding structure chart
is updated monthly.
With regard to article 11(1)(b) of the Takeover Law, the ordinary
shares issued by the Company are listed on various stock
exchanges including NYSE and are freely transferable.
With regard to article 11(1)(d) of the Takeover Law, each
ordinary share of the Company gives right to one vote, as set
out in article 13.6 of the Articles of Association, and there are no
special control rights attaching to the shares. Article 8 of the
Articles of Association provides that the Mittal Shareholder (Mr
Lakshmi N. Mittal, Mrs Usha Mittal or any of their heirs or
successors acting directly or indirectly and/or the trust or trusts
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of which Mr. Lakshmi N. Mittal, Mrs. Usha Mittal and/or their
heirs or successors are the beneficiaries, hold or control
ArcelorMittal shares or any other entity controlled, directly or
indirectly, by either of them) may, at its discretion, exercise the
right of proportional representation and nominate candidates for
appointment to the Board of Directors (defined as “Mittal
Shareholder Nominees”). The Mittal Shareholder has not, to
date, exercised that right.
Articles 11(1)(e) and (f) of the Takeover Law are not applicable
to the Company. However, the sanction of suspension of voting
rights automatically applies, subject to limited exceptions set out
in the Transparency Law (as defined above), to any shareholder
(or group of shareholders) who has (or have) crossed the
thresholds set out in article 7 of the Articles of Association and
articles 8 to 15 of the Transparency Law but have not notified
the Company accordingly. The sanction of suspension of voting
rights will apply until such time as the notification has been
properly made by the relevant shareholder(s).
Article 11(1)(g) of the Takeover Law is not applicable to the
Company.
With regard to article 11(1)(h) of the Takeover Law, the Articles
of Association provide that the directors are elected at the
annual general meeting of shareholders for a term that may not
exceed three years, and may be re-elected. The rules governing
amendments to the Articles of Association are described
elsewhere in this report and are set out in article 19 of the
Articles of Association.
With regard to article 11(1)(i) of the Takeover Law, the 2024
AGM granted the Board of Directors a new share buy-back
authorization whereby the Board of Directors may authorize the
acquisition or sale of Company shares including, but not limited
to, entering into off-market and over-the-counter transactions
and the acquisition of shares through derivative financial
instruments, as well as to enter into cash-settled derivative
financial instruments to mitigate the volatility in the share price
paid to acquire shares in the Company. Any acquisitions,
disposals, exchanges, contributions or transfers of shares by the
Company or other companies in the ArcelorMittal group must be
in accordance with the Luxembourg law of December 23, 2016
on market abuse, Regulation (EU) No. 596/2014 of the
European Parliament and of the Council of April 16, 2014 on
market abuse and Commission Delegated Regulation (EU) No.
2016/1052 of March 8, 2016 with regard to regulatory technical
standards for the conditions applicable to buy-back programs
and stabilization measures and may be carried out by all
means, on or off-market, including by a public offer to buy-back
shares, or by the use of derivatives or option strategies. The
fraction of the capital acquired or transferred in the form of a
block of shares may amount to the entire program. Such
transactions may be carried out at any time, including during a
tender offer period, in accordance with applicable laws and
regulations, including Section 10(b) and Section 9(a)(2) of the
Securities Exchange Act of 1934, as amended (the “Exchange
Act”), and Rule 10b-5 promulgated under the Exchange Act.
The
authorization is valid until the 2027 AGM, or until the date of its
renewal by a resolution of the general meeting of shareholders if
such renewal date is prior to the 2027 AGM.
Details relating to
the repurchase of shares, as approved by the 2024 AGM can be
found under "—Memorandum and Articles of Association -
Issuance and Repurchase of shares".
Articles 11(1)(j) and (k) of the Takeover Law are not applicable
to the Company.
Taxation
United States taxation
The following discussion is a summary of the material U.S.
federal income tax consequences that are likely to be relevant to
U.S. Holders (as defined below) in respect of the ownership and
disposition of ArcelorMittal common shares (hereinafter the
“ArcelorMittal shares”) that are held as capital assets (such as
for investment purposes). This summary does not purport to
address all material tax consequences that may be relevant to a
particular U.S. Holder. This summary also does not take into
account the specific circumstances of particular investors, some
of which (such as tax-exempt entities, banks, insurance
companies, broker-dealers, traders in securities that elect to use
a mark-to-market method of accounting for their securities
holdings, regulated investment companies, real estate
investment trusts, partnerships and other pass-through entities,
investors liable for any U.S. alternative minimum tax, investors
that own or are treated as owning 10% or more of the total
combined voting power or value of ArcelorMittal’s shares,
investors that hold ArcelorMittal shares as part of a straddle,
hedge, conversion, constructive sale or other integrated
transaction, and U.S. Holders whose functional currency is not
the U.S. dollar) may be subject to special tax rules. This
summary is based on the U.S. Internal Revenue Code of 1986,
as amended (the “Code”), the Treasury regulations issued
thereunder, judicial decisions, and published rulings and
administrative pronouncements of the U.S. Internal Revenue
Service (“IRS”), all as in effect on the date hereof, and the
income tax treaty between the United States and Luxembourg
dated April 3, 1996 (as amended by any subsequent protocols)
(the “Treaty”). Those authorities are subject to change (possibly
with retroactive effect) or to differing interpretations.
This summary does not address any aspects of U.S. federal tax
law other than income taxation, or any state, local, or non-U.S.
tax considerations that may be applicable to investors, or the
Medicare contribution tax applicable to net investment income of
certain non-corporate U.S. Holders. Investors are urged to
consult their tax advisors regarding the U.S. federal, state, local
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and other tax consequences of acquiring, owning and disposing
of ArcelorMittal shares.
For purposes of this discussion, a “U.S. Holder” is a beneficial
owner of ArcelorMittal shares that is, for U.S. federal income tax
purposes:
•
an individual citizen or resident of the United States;
•
a corporation (or other entity taxable as a corporation
for U.S. federal income tax purposes) organized in or
under the laws of the United States, any state thereof,
or the District of Columbia; or
•
any other person that is subject to U.S. federal income
tax on a net income basis in respect of the ArcelorMittal
shares.
The U.S. federal income tax consequences of a partner in a
partnership holding ArcelorMittal shares generally will depend
on the status of the partner and the activities of the partnership.
The Company recommends that partners in such a partnership
consult their own tax advisors.
Except where specifically described below, this discussion
assumes that ArcelorMittal is not a passive foreign investment
company (“PFIC”) for U.S. federal income tax purposes. See “—
Passive foreign investment company ("PFIC") status”.
(
a) Taxation of distributions
Cash distributions made by ArcelorMittal in respect of
ArcelorMittal shares will constitute a taxable dividend when such
distribution is actually or constructively received, to the extent
such distribution is paid out of the current or accumulated
earnings and profits of ArcelorMittal (as determined under U.S.
federal income tax principles). The amount of any distribution
will include the amount of any applicable Luxembourg
withholding tax. To the extent the amount of any distribution
received by a U.S. Holder in respect of ArcelorMittal shares
exceeds the current or accumulated earnings and profits of
ArcelorMittal, the distribution (1) will be treated as a non-taxable
return of the U.S. Holder’s adjusted tax basis in those
ArcelorMittal shares and (2) thereafter will be treated as U.S.-
source capital gain. Because ArcelorMittal does not maintain
calculations of earnings and profits under U.S. federal income
tax principles, it is expected that distributions generally will be
reported to U.S. Holders as dividends. Distributions of additional
ArcelorMittal shares that are made to U.S. Holders with respect
to their ArcelorMittal shares, and that are part of a pro rata
distribution to all ArcelorMittal shareholders, generally will not be
subject to U.S. federal income tax unless the U.S. Holder has
the right to receive cash or property instead, in which case the
U.S. Holder will be treated as if it received cash equal to the fair
market value of the distribution.
The U.S. dollar amount of a taxable dividend generally will be
included in the gross income of a U.S. Holder as ordinary
income derived from sources outside the United States for U.S.
foreign tax credit purposes and generally will be passive
category income for purposes of the foreign tax credit limitation.
Dividends paid in euro will be included in a U.S. Holder’s income
in a U.S. dollar amount calculated by reference to the exchange
rate in effect on the date the dividend is received; a recipient of
such dividends that converts such euro to dollars upon receipt
generally should not be required to recognize foreign currency
gain or loss in respect of the dividend income. Dividends paid by
ArcelorMittal will not be eligible for the dividends-received
deduction generally allowed to U.S. corporations in respect of
dividends received from U.S. corporations.
Taxable dividends received by certain non-corporate U.S.
Holders (including individuals) with respect to the ArcelorMittal
shares will be subject to U.S. federal income taxation at rates
that are lower than the rates applicable to ordinary income if the
dividends represent “qualified dividend income”. Subject to
certain exceptions for short-term or hedged positions, dividends
paid on the ArcelorMittal shares will be treated as qualified
dividend income if (i) the ArcelorMittal shares are readily
tradable on an established securities market in the United
States (such as the New York Stock Exchange) and (ii)
ArcelorMittal is not a Passive foreign investment company
("PFIC") in the year in which the dividend was paid or in the year
prior thereto.
As discussed further below, ArcelorMittal believes
that it was not a PFIC for U.S. federal income tax purposes with
respect to its 2023 and 2024 taxable years, and ArcelorMittal
does not expect to be a PFIC for its 2025 taxable year. See “—
Passive foreign investment company ("PFIC") status”.
U.S. Holders of ArcelorMittal shares should consult their own tax
advisors regarding the availability of the reduced rate of U.S.
federal income tax on dividends in light of their own particular
circumstances.
Subject to generally applicable limitations and conditions,
Luxembourg dividend withholding tax paid at the appropriate
rate applicable to the U.S. Holder may be eligible for a credit
against such U.S. Holder’s U.S. federal income tax liability.
These generally applicable limitations and conditions include
requirements
adopted by the IRS in regulations promulgated in
December 2021, and any Luxembourg tax will need to satisfy
these requirements in order to be eligible to be a creditable tax
for a U.S. Holder. In the case of a U.S. Holder that either (i) is
eligible for, and properly elects, the benefits of the Treaty, or (ii)
consistently elects to apply a modified version of these rules
under recently issued temporary guidance and complies with
specific requirements set forth in such guidance, the
Luxembourg tax on dividends will be treated as meeting the new
requirements and therefore as a creditable tax. In the case of all
other U.S. Holders, the application of these requirements to the
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Luxembourg tax on dividends is uncertain, and we have not
determined whether these requirements have been met. If the
Luxembourg dividend tax is not a creditable tax for a U.S.
Holder or the U.S. Holder does not elect to claim a foreign tax
credit for any foreign income taxes paid or accrued in the same
taxable year, the U.S. Holder may be able to deduct the
Luxembourg tax in computing such U.S. Holder’s taxable
income for U.S. federal income tax purposes. The temporary
guidance discussed above also indicates that the Treasury and
the IRS are considering proposing amendments to the
December 2021 regulations and that the temporary guidance
can be relied upon until additional guidance is issued that
withdraws or modifies the temporary guidance. The rules with
respect to foreign tax credits are complex and involve the
application of rules that depend on a U.S. Holder’s particular
circumstances. Accordingly, U.S. Holders are urged to consult
their tax advisors regarding the availability of the foreign tax
credit under their particular circumstances.
(b) Taxation of sales, exchanges, or other dispositions of
ArcelorMittal shares
Sales or other taxable dispositions by U.S. Holders of
ArcelorMittal shares generally will give rise to gain or loss equal
to the difference between the amount realized on the disposition
and the U.S. Holder’s tax basis in such ArcelorMittal shares, as
determined in U.S. dollars. A U.S. Holder generally will have an
initial tax basis in each ArcelorMittal share equal to its U.S.
dollar cost to the U.S. Holder.
In general, gain or loss recognized on the sale or exchange of
ArcelorMittal shares will be capital gain or loss and, if the U.S.
Holder’s holding period for such ArcelorMittal shares exceeds
one year, will be long-term capital gain or loss. Certain U.S.
Holders, including individuals, are eligible for preferential rates
of U.S. federal income tax in respect of long-term capital gains.
The deduction of capital losses against ordinary income is
subject to limitations under the Code.
Passive foreign investment company (“PFIC”) status
Special U.S. federal income tax rules apply to investors owning
stock of a PFIC. ArcelorMittal believes that it was not a PFIC for
U.S. federal income tax purposes with respect to its 2023 and
2024 taxable years, and ArcelorMittal does not expect to be a
PFIC for its 2025 taxable year. This conclusion is based upon an
annual analysis of its financial position and an interpretation of
the PFIC provisions that ArcelorMittal believes is correct. No
assurances can be made, however, that the applicable tax law
or relevant factual circumstances will not change in a manner
that affects the determination of ArcelorMittal’s PFIC status. If,
contrary to the foregoing, ArcelorMittal were classified as a
PFIC, a U.S. Holder would be subject to a special tax at ordinary
income tax rates on “excess distributions” (generally, any
distributions that you receive in a taxable year that are greater
than 125 percent of the average annual distributions that the
U.S. Holder has received in the preceding three taxable years,
or the U.S. Holder’s holding period, if shorter), and gain that that
the U.S. Holder recognizes on the sale of the holder’s shares.
Under these rules (a) the “excess distribution or gain will be
allocated”, ratably over the U.S. Holder’s holding period, (b) the
amount allocated to the current taxable year and any taxable
year prior to the first taxable year in which we are a PFIC will be
taxed as ordinary income, and (c) the amount allocated to each
of the other taxable years will be subject to tax at the highest
rate of tax in effect for the applicable class of taxpayer for that
year, and an interest charge for the deemed deferral benefit will
be imposed with respect to the resulting tax attributable to each
such other taxable year. If ArcelorMittal were a PFIC and its
shares constitute “marketable stock”, a U.S. Holder may elect to
instead be taxed annually on a mark-to-market basis with
respect to its ArcelorMittal shares and generally would not be
subject to the PFIC rules described above. U.S. Holders should
consult their tax advisors regarding the application of the PFIC
rules to ArcelorMittal including the availability and consequences
of a mark-to-market election with respect to their shares of
ArcelorMittal.
Foreign Financial Asset Reporting
Certain U.S. Holders that own “specified foreign financial
assets” with an aggregate value in excess of U.S.$50,000 on
the last day of the taxable year or U.S.$75,000 at any time
during the taxable year are generally required to file an
information statement along with their tax returns, currently on
Form 8938, with respect to such assets. “Specified foreign
financial assets” include any financial accounts held at a non-
U.S. financial institution, as well as securities issued by a non-
U.S. issuer that are not held in accounts maintained by financial
institutions. The understatement of income attributable to
“specified foreign financial assets” in excess of U.S.$5,000
extends the statute of limitations with respect to the tax return to
six years after the return was filed. U.S. Holders who fail to
report the required information could be subject to substantial
penalties. U.S. Holders are encouraged to consult with their own
tax advisers regarding the possible application of these rules,
including the application of the rules to their particular
circumstances.
Backup withholding and information reporting
The payment of proceeds received upon the sale, exchange or
redemption of ArcelorMittal shares by U.S. Holders within the
United States (or through certain U.S.-related financial
intermediaries), and dividends on ArcelorMittal shares paid to
U.S. Holders in the United States (or through certain U.S.-
related financial intermediaries), will be subject to information
reporting and may be subject to backup withholding unless the
U.S. Holder (1) is an exempt recipient, and establishes that
exemption if required or (2) in the case of backup withholding,
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provides an IRS Form W-9 (or an acceptable substitute form)
that contains the U.S. Holder’s taxpayer identification number
and that certifies that no loss of exemption from backup
withholding has occurred.
Backup withholding is not an additional tax. The amount of
backup withholding imposed on a payment to a U.S. Holder will
be allowed as a credit against the holder’s U.S. federal income
tax liability, if any, or as a refund, so long as the required
information is properly furnished to the IRS. Holders that are not
"U.S. persons" (as defined in the Code) may need to comply
with certification procedures to establish their non-U.S. status in
order to establish an exemption from information reporting and
backup withholding.
THE SUMMARY OF U.S. FEDERAL INCOME TAX
CONSEQUENCES SET OUT ABOVE IS INTENDED FOR
GENERAL INFORMATION PURPOSES ONLY. EACH
INVESTOR IN ARCELORMITTAL ORDINARY SHARES IS
URGED TO CONSULT ITS OWN TAX ADVISOR WITH
RESPECT TO THE PARTICULAR TAX CONSEQUENCES OF
THE ACQUISITION, OWNERSHIP AND DISPOSITION OF
ARCELORMITTAL SHARES BASED ON THE INVESTOR’S
PARTICULAR CIRCUMSTANCES.
Luxembourg taxation
The following is a summary addressing certain material
Luxembourg tax consequences that are likely to be relevant to
holders of shares in respect of the ownership and disposition of
shares in ArcelorMittal.
This summary does not purport to address all material tax
considerations that may be relevant to a holder or prospective
holder of ArcelorMittal shares. This summary also does not take
into account the specific circumstances of particular investors
some of which may be subject to special tax rules, including
dealers in securities, financial institutions, insurance companies,
investment funds.
This summary is based on the laws, regulations and applicable
tax treaties as in effect on the date hereof in Luxembourg, all of
which are subject to change, possibly with retroactive effect.
Holders of ArcelorMittal shares should consult their own tax
advisers as to the particular tax consequences, under the tax
laws of the country of which they are residents for tax purposes
of the ownership or disposition of ArcelorMittal shares.
This summary does not address the terms of employee stock
options or other incentive plans implemented by ArcelorMittal
and its subsidiaries and does not purport to provide the holders
of stock subscription options or other comparable instruments
(including shares acquired under employee share ownership
programs) with a description of the possible tax and social
security implications for them, nor to determine under which
conditions these options or other instruments are or may
become exercisable. These holders are therefore urged to
consult their own tax advisers as to the potential tax and social
security implications of an exercise of their options or other
instruments.
As used herein, a “Luxembourg individual” means an individual
resident in Luxembourg who is subject to personal income tax
(
impôt sur le revenu
) on his or her worldwide income from
Luxembourg or foreign sources, and a “Luxembourg company”
means a company or another entity resident in Luxembourg
subject to corporate income tax (
impôt sur le revenu des
collectivités
) on its worldwide income from Luxembourg or
foreign sources. For the purposes of this summary, Luxembourg
individuals and Luxembourg companies are collectively referred
to as “Luxembourg Holders”. A “non-Luxembourg Holder” means
any investor in ArcelorMittal shares other than a Luxembourg
Holder.
(a) Luxembourg withholding tax on dividends paid on
ArcelorMittal shares
Dividends distributed by ArcelorMittal will in principle be subject
to Luxembourg withholding tax at the rate of 15%.
Luxembourg resident corporate holders
Dividend withholding tax exemption applies on dividends paid by
ArcelorMittal to a Luxembourg company (that is, a fully taxable
entity within the meaning of Article 159 of the Luxembourg
Income Tax Law) holding shares (or a Luxembourg permanent
establishment/representative of a qualifying foreign entity to
which the shares are attributable), which meets the qualifying
participation test (that is, a shareholding in ArcelorMittal of at
least 10% or having an acquisition cost of at least EUR
1.2 million held or committed to be held for a minimum one year
holding period) under the conditions of Article 147 of the
Luxembourg Income Tax Law). If such exemption from dividend
withholding tax does not apply, a Luxembourg company may be
entitled to a tax credit.
Luxembourg resident individual holders
Luxembourg withholding tax on dividends paid by ArcelorMittal
to a Luxembourg resident individual holder may entitle such
Luxembourg Holder to a tax credit for the tax withheld.
Non-Luxembourg Holders
Non-Luxembourg Holders of ArcelorMittal shares who have held
a shareholding in ArcelorMittal representing at least 10% of
ArcelorMittal’s share capital (or shares with an acquisition cost
of at least EUR 1.2 million) for an uninterrupted period of at least
12 months (or where held for a shorter period, where the holder
takes the commitment to hold the qualifying shareholding for
such period) may benefit from an exemption from the dividend
withholding tax if they are: (i) entities which fall within the scope
of Article 2 of the European Council Directive 2011/96/EU, as
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amended (the “EU Parent-Subsidiary Directive”) and which are
not excluded to benefit from the EU Parent-Subsidiary Directive
under its mandatory general anti-avoidance rule (“GAAR”) in
each case as implemented in Luxembourg, or (ii) corporates
subject to a tax comparable to Luxembourg corporate income
tax and which are resident of a country having concluded a
double tax avoidance treaty with Luxembourg, or (iii) corporates
subject to a tax comparable to Luxembourg corporate income
tax and which are resident in a State being part of the European
Economic Area (EEA) other than a Member State of the
European Union, or (iv) corporates resident in Switzerland
subject to corporate income tax in Switzerland without benefiting
from an exemption.
Non-Luxembourg Holders of ArcelorMittal shares who are tax
resident in a country having a double tax avoidance treaty with
Luxembourg may claim for a reduced withholding tax rate or a
withholding tax relief under the conditions and subject to the
limitations set forth in the relevant treaty.
(b) Luxembourg income tax on dividends paid on
ArcelorMittal shares and capital gains
Luxembourg resident individual holders
For Luxembourg individuals, income in the form of dividends or
capital gains derived from ArcelorMittal shares will normally be
subject to individual income tax at the applicable progressive
rate with a current top effective marginal rate of 45.78%
including the unemployment fund contribution at the maximum
rate of 9%. Such dividends may benefit from the 50% exemption
set forth in Article 115(15a) of the Luxembourg Income Tax Law,
subject to fulfillment of the conditions set out therein. Capital
gains will only be taxable if they are realized on a sale of
ArcelorMittal shares, which takes place within the first six
months following their acquisition, or if the relevant holder (alone
or together with his/her spouse or registered partner and his/her
underage children), directly or indirectly, holds or has held more
than 10% of the ArcelorMittal shares at any time during the past
five years.
Luxembourg resident corporate holders
For Luxembourg companies, which do not benefit from a special
tax regime, income in the form of dividends or capital gains
derived from ArcelorMittal shares will be subject to corporate
income tax and municipal business tax. The combined rate for
these two taxes (including an unemployment fund contribution of
7%) for Luxembourg companies with registered office in
Luxembourg City is
24.94
% in 2024 (23.87% in 2025). Such
dividends may benefit either from the 50% exemption set forth in
Article 115(15a) of the Luxembourg Income Tax Law or from the
full exemption set forth in Article 166 of the Luxembourg Income
Tax Law, subject in each case to fulfillment of the respective
conditions set out therein. Capital gains realized on the sale of
ArcelorMittal shares may benefit from the full exemption
provided for by the Grand Ducal Decree of December 21, 2001,
as amended, subject to fulfillment of the conditions set out
therein.
Non-Luxembourg Holders
An individual or corporate non-Luxembourg Holder of
ArcelorMittal shares who/which realizes a gain on disposal
thereof (and who/which does not have a permanent
establishment in Luxembourg to which the ArcelorMittal shares
would be attributable) will only be subject to Luxembourg
taxation on capital gains arising upon disposal of such shares if
such holder has (if an individual, alone or together with his or
her spouse or registered partner and underage children) directly
or indirectly held more than 10% of the capital of ArcelorMittal,
at any time during the past five years, and either (1) such holder
has been a resident of Luxembourg for tax purposes for at least
15 years and has become a non-resident within the last five
years preceding the realization of the gain, subject to any
applicable tax treaty, or (2) the disposal of ArcelorMittal shares
occurs within six months from their acquisition, subject to any
applicable tax treaty.
A corporate non-Luxembourg Holder, which has a permanent
establishment or a permanent representative in Luxembourg to
which ArcelorMittal shares would be attributable, will bear
corporate income tax and municipal business tax on dividends
received and/or a gain realized on a disposal of such shares
under the same conditions as are applicable to a Luxembourg
resident corporate holder, as described above.
(c) Other taxes
Net wealth tax
Luxembourg net wealth tax will not be levied on a Luxembourg
Holder unless:
•
the Luxembourg Holder is a legal entity subject to net
wealth tax in Luxembourg; or
•
ArcelorMittal shares are attributable to an enterprise or
part thereof which is carried on through a permanent
establishment or a permanent representative in
Luxembourg of a non-resident entity.
Net wealth tax is levied annually at a digressive rate depending
on the amount of the net wealth of the above holders, as
determined for net wealth tax purposes (i.e. 0.5% on an amount
up to EUR 500 million and 0.05% on the amount of taxable net
wealth exceeding EUR 500 million).
ArcelorMittal shares may be exempt from net wealth tax subject
to the conditions set forth by Article 60 of the Law of October 16,
1934 on the valuation of assets (Bewertungsgesetz), as
amended.
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Estate and gift tax
Luxembourg inheritance tax may be levied on the transfer of
ArcelorMittal shares upon the death of a Luxembourg individual.
No Luxembourg inheritance tax is, however, levied on the
transfer of the ArcelorMittal shares upon the death of a holder in
cases where the deceased was not a resident of Luxembourg
for inheritance tax purposes.
Luxembourg gift tax will be levied in the event that a gift of
ArcelorMittal shares is made pursuant to a notarial deed signed
before a Luxembourg notary.
Other Luxembourg tax considerations
No registration tax will be payable by a holder of shares upon
the issue, subscription or acquisition of shares in ArcelorMittal or
upon the disposal of shares by sale or exchange.
Evaluation of disclosure controls and procedures
Disclosure controls and procedures
Management maintains disclosure controls and procedures that
are designed to ensure that information required to be disclosed
in the Company’s reports under the Securities Exchange Act of
1934, as amended (the “Exchange Act”) is recorded, processed,
summarized and reported within time periods specified in the
SEC’s rules and forms, and that such information is
accumulated and communicated to management, including the
Chief Executive Officer and Chief Financial Officer, as
appropriate, to allow timely decisions regarding required
disclosure. ArcelorMittal’s disclosure controls and procedures
are designed to provide reasonable assurance of achieving their
objectives.
There are inherent limitations to the effectiveness of any system
of disclosure controls and procedures, including the possibility of
human error and the circumvention or overriding of the controls
and procedures. Accordingly, even effective disclosure controls
and procedures can only provide reasonable assurance of
achieving their control objectives.
Management, under the supervision and with the participation of
its Chief Executive Officer and Chief Financial Officer, carried
out an evaluation of the effectiveness of the design and
operation of the Company’s disclosure controls and procedures
(as defined in Exchange Act Rule 13a-15(e)) as of December
31, 2024. Based upon that evaluation, the Company’s Chief
Executive Officer and Chief Financial Officer concluded that, as
of December 31, 2024, the Company’s disclosure controls and
procedures were effective.
Management’s report on internal control over financial reporting
Management is responsible for establishing and maintaining
adequate internal control over financial reporting as defined in
Rule 13a-15(f) of the Exchange Act. Internal control over
financial reporting is a process designed to provide reasonable
assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in
accordance with generally accepted accounting principles.
Because of its inherent limitations, internal control over financial
reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effectiveness to future periods
are subject to the risk that controls may become inadequate
because of changes in conditions, or that the degree of
compliance with the policies and procedures may deteriorate
.
Management assessed the effectiveness of internal control over
financial reporting as of December 31, 2024 based upon the
framework in Internal Control—Integrated Framework (2013)
issued by the Committee of Sponsoring Organizations of the
Treadway Commission (“COSO”).
Based on this assessment, management concluded that
ArcelorMittal’s internal control over financial reporting was
effective as of December 31, 2024.
The effectiveness of management’s internal control over
financial reporting as of December 31, 2024 has been audited
by the Company’s independent registered public accounting
firm, Ernst & Young S.A., and their report as of March 10, 2025
below expresses an unqualified opinion on the Company’s
internal control over financial reporting.
Remediation of Previously Disclosed Material Weakness
A material weakness is a deficiency, or a combination of
deficiencies, in internal control over financial reporting, such that
there is a reasonable possibility that a material misstatement of
the Company's financial statements will not be prevented or
detected on a timely basis.
As described in ArcelorMittal’s annual report on Form 20-F for
the year ended December 31, 2023, ArcelorMittal’s
management, with the oversight of the Audit & Risk Committee,
concluded that its internal control over financial reporting was
not effective as of December 31, 2023 due to a material
weakness that was identified as a result of control deficiencies
at one of the Company’s Canadian subsidiaries, with respect to
information technology general controls (“ITGCs”) in the areas
of user access and program change management over certain
information technology (“IT”) systems that support the
recognition of sales and cost of sales, ineffective business
process controls (automated and manual IT-dependent) due to
the dependency on such ITGCs, and other ineffective business
process controls supporting the recognition of sales and cost of
sales. This material weakness did not result in any material
misstatements in the consolidated financial statements.
During the year ended December 31, 2024, ArcelorMittal
implemented a remediation plan to address this material
weakness and to enhance the Company’s control environment.
The remediation plan included the following key actions to
enhance ITGCs and other business process controls supporting
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the recognition of sales and cost of sales: (i) enhanced
identification of IT applications relevant to internal control over
financial reporting, (ii) appropriate implementation and operation
of
ITGCs with a focus on the areas of user access and program
change management of certain IT systems that support the
recognition of sales and cost of sales which had a cascading
effect on business process controls (automated and manual IT-
depende
nt),
(ii
i) additional training of Company personnel and
(iv) clear communication of control responsibilities through
identification and education of the control owners as well as
documentation of the procedure to be followed and the
expected
outcome.
As a result of these efforts and the control tests performed,
ArcelorMittal’s management concluded that the material
weaknesses had been remediated as of December 31, 2024.
Changes in Internal Control over Financial Reporting
Except as noted in the preceding paragraphs, there have been
no changes in the Company’s internal control over financial
reporting that occurred during the year ended December 31,
2024 that have materially affected or are reasonably likely to
materially affect the Company’s internal control over financial
reporting.
182
Report of Independent Registered Public Accounting Firm
To the Shareholders and the Board of Directors of ArcelorMittal
Opinion on Internal Control Over Financial Reporting
We have audited ArcelorMittal and subsidiaries’ internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control
—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion,
ArcelorMittal and subsidiaries (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2024, based
on the COSO criteria.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated
statements of financial position as of December 31, 2024 and 2023, the related consolidated statements of operations, other comprehensive income, changes in
equity and cash flows for each of the three years in the period ended December 31, 2024, and the related notes and expressed an unqualified opinion thereon.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal
control over financial reporting included in the accompanying Management’s report on internal control over financial reporting. Our responsibility is to express an
opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required
to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and
Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether effective internal control over financial reporting was maintained in all material respects.
Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating
the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the
circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial
reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of
financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in
accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of
unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance
with the policies or procedures may deteriorate.
/s/ Ernst & Young
Société anonyme
Cabinet de révision agréé
Luxembourg, Grand Duchy of Luxembourg
March 10, 2025
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Principal accountant fees and services
Ernst & Young S.A. acted as the principal independent
registered public accounting firm for ArcelorMittal for the fiscal
years ended December 31, 2024 and for the fiscal year ended
December 31, 2023. Set forth below is a breakdown of fees for
services rendered by the auditor in 2024 and 2023.
Audit Fees.
Audit fees for the audits of financial statements in
2024 and 2023 were
$
26.0
million
and
$
24.2
million,
respectively, and for regulatory filings
$
0.1
million
and
$
0.1
million i
n 2024 and 2023, respectively.
Audit-Related Fees.
Audit-related fees in 2024 and 2023 were
$
0.7
million
and
$
2.5
million,
respectively. Audit-related fees
include fees for agreed upon procedures for various
transactions or reports.
Tax Fees.
Fees relating to tax planning, advice and compliance
in 2024 and 2023 were
$
0.6
million
and
$
1.2
million
,
respectively.
All Other Fees.
Fees in 2024 and 2023 for all other services
were
$
0.1
million
and
$
0.1
million
, respectively. All other fees
relate to services not included in the first three categories.
The Audit & Risk Committee has reviewed and approved all of
the audit, audit-related, tax and other services provided by the
principal independent registered public accounting firm in 2024
and 2023 within its scope, prior to commencement of the
engagements. None of the services provided in 2024 or 2023
were approved under the de minimis exception allowed under
the Exchange Act.
The Audit & Risk Committee pre-approves all permissible non-
audit service engagements rendered by the principal
independent registered public accounting firm. The Audit & Risk
Committee has delegated pre-approval powers on a case-by-
case basis to the Audit & Risk Committee Chairwoman, for
instances where the Committee is not in session and the
preapproved services are reviewed in the subsequent
Committee
meeting
.
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Glossary - definitions, terminology and principal subsidiaries
Definitions and terminology
Unless indicated otherwise, or the context otherwise requires, references herein to “
ArcelorMittal
”, “we”, “us”, “our”, “ArcelorMittal
Group”, “Group” and the “Company” or similar terms are to ArcelorMittal S.A. consolidated with its subsidiaries. References to
“ArcelorMittal S.A.”, “ArcelorMittal parent” or “parent of ArcelorMittal” are to
ArcelorMittal S.A
., formerly known as Mittal Steel Company
N.V. (“Mittal Steel”), having its registered office at
24-26, Boulevard d’Avranches, L-1160 Luxembourg, Grand Duchy of Luxembourg
.
ArcelorMittal’s principal operating subsidiaries, categorized by reporting segment and location, are listed below.
For the purposes of this annual report, the names of the following ArcelorMittal subsidiaries as abbreviated below are used where
applicable.
|
Name of Subsidiary
|
Abbreviation
|
Country
|
||
|
North America
|
|
|||
|
ArcelorMittal Dofasco G.P.
|
ArcelorMittal Dofasco
|
Canada
|
||
|
ArcelorMittal México S.A. de C.V.
|
ArcelorMittal Mexico
|
Mexico
|
||
|
ArcelorMittal Long Products Canada G.P.
|
ArcelorMittal Long Products Canada
|
Canada
|
||
|
ArcelorMittal Texas HBI LLC
|
ArcelorMittal Texas HBI
|
United States of America
|
||
|
Brazil and neighboring countries ("Brazil")
|
||||
|
ArcelorMittal Brasil S.A.
|
ArcelorMittal Brasil
|
Brazil
|
||
|
Acindar Industria Argentina de Aceros S.A.
|
Acindar
|
Argentina
|
||
|
ArcelorMittal Pecém S.A.
|
ArcelorMittal Pecém
|
Brazil
|
||
|
Europe
|
||||
|
ArcelorMittal France S.A.S.
|
ArcelorMittal France
|
France
|
||
|
ArcelorMittal Belgium N.V.
|
ArcelorMittal Belgium
|
Belgium
|
||
|
ArcelorMittal España S.A.
|
ArcelorMittal España
|
Spain
|
||
|
ArcelorMittal Flat Carbon Europe S.A.
|
AMFCE
|
Luxembourg
|
||
|
ArcelorMittal Poland S.A.
|
ArcelorMittal Poland
|
Poland
|
||
|
ArcelorMittal Eisenhüttenstadt GmbH
|
ArcelorMittal Eisenhüttenstadt
|
Germany
|
||
|
ArcelorMittal Bremen GmbH
|
ArcelorMittal Bremen
|
Germany
|
||
|
ArcelorMittal Méditerranée S.A.S.
|
ArcelorMittal Méditerranée
|
France
|
||
|
ArcelorMittal Belval & Differdange S.A.
|
ArcelorMittal Belval & Differdange
|
Luxembourg
|
||
|
ArcelorMittal Hamburg GmbH
|
ArcelorMittal Hamburg
|
Germany
|
||
|
ArcelorMittal Duisburg GmbH
|
ArcelorMittal Duisburg
|
Germany
|
||
|
Sustainable solutions
|
||||
|
ArcelorMittal International Luxembourg S.A.
|
ArcelorMittal International Luxembourg
|
Luxembourg
|
||
|
Mining
|
||||
|
ArcelorMittal Mining Canada G.P. and ArcelorMittal Infrastructure Canada
G.P.
|
ArcelorMittal Mines and Infrastructure Canada
("AMMC")
|
Canada
|
||
|
ArcelorMittal Liberia Ltd.
|
ArcelorMittal Liberia
|
Liberia
|
||
|
Others
|
||||
|
PJSC ArcelorMittal Kryvyi Rih
|
ArcelorMittal Kryvyi Rih
|
Ukraine
|
||
|
ArcelorMittal South Africa Ltd.
|
ArcelorMittal South Africa
|
South Africa
|
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In addition, unless indicated otherwise, or the context otherwise requires, references in this annual report to abbreviations or terms
shown below have the following definitions:
|
ARS
|
Argentine Peso, the official currency of Argentina
|
INR
|
Indian rupee, the official currency of India
|
|
|
Articles of
Association
|
the amended and r
estated articles of association of
ArcelorMittal, dated April 28, 2023 filed as Exhibit
1.1 hereto.
|
Iron pellets
|
agglomerated ultra-fine iron ore particles of a size
and quality suitable for use in steel-making
processes
|
|
|
AUD$ or AUD
|
Australian dollars, the official currency of Australia
|
Kilometers
|
measures of distance are stated in kilometers,
each of which equals approximately 0.62 miles, or
1000 in meters, each of which equals
approximately 3.28 feet
|
|
|
Brownfield project
|
the expansion of an existing operation
|
KZT
|
the Kazakhstani tenge, the official currency of
Kazakhstan
|
|
|
C$ or CAD
|
Canadian dollars, the official currency of Canada
|
Metallurgical coal
|
a broader term than coking coal that includes all
coals used in steelmaking, such as coal used for
the pulverized coal injection (“PCI”) process
|
|
|
Executive Office
|
the Executive Chairman, Mr. Lakshmi N. Mittal and
Chief Executive Officer, Mr. Aditya Mittal
|
PLN
|
Polish złoty, the official currency of Poland
|
|
|
CIS
|
the countries of the Commonwealth of Independent
States
|
Production capacity
|
the annual production capacity of plant and
equipment based on existing technical parameters
as estimated by management
|
|
|
CNY
|
Chinese yuan, the official currency of China
|
Ps or MXN
|
the Mexican peso, the official currency of the
United Mexican States
|
|
|
Coking coal
|
coal that, by virtue of its coking properties, is used in
the manufacture of coke, which is used in the
steelmaking process
|
Real, reais or R$
|
Brazilian reais, the official currency of Brazil
|
|
|
Crude steel
|
the first solid steel product upon solidification of
liquid steel, including ingots from conventional mills
and semis (e.g., slab, billet and blooms) from
continuous casters
|
ROM
|
run of mine - mined iron ore or coal to be fed to a
preparation and/or concentration process
|
|
|
Downstream
|
finishing operations: flat products - the process after
the production of hot-rolled coil/plates, and long
products - the process after the production of
blooms/billets (including production of bars, wire
rods, SBQ, etc.)
|
Sales
|
include shipping and handling fees and costs billed
to a customer in a sales transaction
|
|
|
DMTU or dmtu
|
dry metric tonne unit
|
SBQ
|
special bar quality steel, a high-quality long
product
|
|
|
DRI
|
direct reduced iron, a metallic iron formed by
removing oxygen from iron ore without the formation
of, or passage through, a smelting phase. DRI can
be used as feedstock for steel production
|
Significant
Shareholder
|
HSBC Trustee (C.I.) Limited as trustee of a fully
discretionary trust of which Mr. Lakshmi N. Mittal
and Mrs. Usha Mittal are beneficiaries
|
|
|
Energy coal
|
coal used as a fuel source in electrical power
generation, cement manufacture and various
industrial applications. Energy coal may also be
referred to as steam or thermal coal
|
UAH
|
Ukrainian hryvnia, the official currency of Ukraine
|
|
|
Euro, euros, EUR or
€
|
the official currency of the European Union (“EU”)
member states participating in the European
Monetary Union
|
US$, $, dollars,
USD or U.S. dollar
|
United States dollar, the official currency of the
United States
|
|
|
Sinter
|
a metallic input used in the blast furnace steel-
making process, which aggregates fines, binder and
other materials into a coherent mass by heating
without melting
|
Upstream
|
operations that precede downstream steel-making,
coking coal, coke, sinter, DRI, blast furnace, basic
oxygen furnace (“BOF”), electric arc furnace
(“EAF”), casters & hot rolling/plate mill
|
|
|
Spanish Stock
Exchanges
|
the stock exchanges of Madrid, Barcelona, Bilbao
and Valencia
|
Wet recoverable
|
a quantity of iron ore or coal recovered after the
material from the mine has gone through a
preparation and/or concentration process
excluding drying
|
|
|
Steel products
|
finished and semi-finished steel products, and
exclude raw materials (including those described
under “upstream” below), direct reduced iron
(“DRI”), hot metal, coke, etc.
|
ZAR
|
South African rand, the official currency of the
Republic of South Africa
|
|
|
Tons, net tons or ST
|
short tons are used in measurements involving steel
products as well as crude steel, iron ore, iron ore
pellets, DRI, hot metal, coke, coal, pig iron and
scrap (a short ton is equal to 907.2 kilograms or
2,000 pounds)
|
Metric Tonnes or
MT
|
metric tonnes and are used in measurements
involving steel products, as well as crude steel,
iron ore, iron ore pellets, DRI, hot metal, coke,
coal, pig iron and scrap (a metric tonne is equal to
1,000 kilograms or 2,204.62 pounds)
|
186
|
Management report
|
|
Executive Officers
|
those executives of the Company who are
supporting the Executive Office and jointly with the
Executive Office represent the senior management
of the Company
|
Probable mineral
reserve
|
is the economically mineable part of an indicated
and, in some cases, a measured mineral resource.
|
|
|
EAF
|
Electric arc furnaces are used to produce steel from
scrap melted using electricity, in contrast to the cast
iron sector (blast furnace – converter) where it is
produced from iron ore.
|
Mineral resource
|
is a concentration or occurrence of material of
economic interest in or on the Earth's crust in such
form, grade or quality, and quantity that there are
reasonable prospects for economic extraction. A
mineral resource is a reasonable estimate of
mineralization, taking into account relevant factors
such as cut-off grade, likely mining dimensions,
location or continuity, that, with the assumed and
justifiable technical and economic conditions, is
likely to, in whole or in part, become economically
extractable. It is not merely an inventory of all
mineralization drilled or sampled.
|
|
|
GMB
|
the Group Management Board, the former senior
management body which was replaced by the CEO
Office subsequently renamed Executive Office. The
Executive Office, supported by nine Executive
Officers, makes up the Company’s senior
management
|
Measured mineral
resource
|
is that part of a mineral resource for which quantity
and grade or quality are estimated on the basis of
conclusive geological evidence and sampling. The
level of geological certainty associated with a
measured mineral resource is sufficient to allow a
qualified person to apply modifying factors, in
sufficient detail to support detailed mine planning
and final evaluation of the economic viability of the
deposit. Because a measured mineral resource
has a higher level of confidence than the level of
confidence of either an indicated mineral resource
or an inferred mineral resource, a measured
mineral resource may be converted to a proven
mineral reserve or to a probable mineral reserve.
|
|
|
Greenfield project
|
the development of a new project
|
Indicated mineral
resource
|
is that part of a mineral resource for which quantity
and grade or quality are estimated on the basis of
adequate geological evidence and sampling. The
level of geological certainty associated with an
indicated mineral resource is sufficient to allow a
qualified person to apply modifying factors in
sufficient detail to support mine planning and
evaluation of the economic viability of the deposit.
Because an indicated mineral resource has a
lower level of confidence than the level of
confidence of a measured mineral resource, an
indicated mineral resource may only be converted
to a probable mineral reserve.
|
|
|
Green steel
|
steel products subject to auditor verified certification
of the
CO
2
savings achieved
|
Inferred mineral
resource
|
is that part of a mineral resource for which quantity
and grade or quality are estimated on the basis of
limited geological evidence and sampling. The
level of geological uncertainty associated with an
inferred mineral resource is too high to apply
relevant technical and economic factors likely to
influence the prospects of economic extraction in a
manner useful for evaluation of economic viability.
Because an inferred mineral resource has the
lowest level of geological confidence of all mineral
resources, which prevents the application of the
modifying factors in a manner useful for evaluation
of economic viability, an inferred mineral resource
may not be considered when assessing the
economic viability of a mining project, and may not
be converted to a mineral reserve.
|
|
|
Mineral reserve
|
is an estimate of tonnage and grade or quality of
indicated and measured mineral resources that, in
the opinion of the qualified person, can be the basis
of an economically viable project. More specifically,
it is the economically mineable part of a measured
or indicated mineral resource, which includes
diluting materials and allowances for losses that
may occur when the material is mined or extracted.
|
LTIFR
|
Lost Time Injury Frequency Rate ("LTIFR") defined
as Lost Time Injuries ("LTI") per 1,000,000 worked
hours (own personnel and contractors); a LTI is an
incident that causes an injury that prevents the
person from returning to his/her next scheduled
shift or work period
|
|
|
Proven mineral
reserve
|
is the economically mineable part of a measured
mineral resource and can only result from
conversion of a measured mineral resource.
|
187
Exhibits
EXHIBIT INDEX
|
Exhibit
|
Description
|
|
Number
|
|
|
1.1*
|
Amended and Restated Articles of Association of ArcelorMittal dated April 28, 2023 (filed as Exhibit 1.1 to the annual report on Form
20-F filed on February 28, 2024) and available at
https://www.sec.gov/Archives/edgar/data/1243429/000124342924000005/
|
|
2.1
|
The total amount of long-term debt securities authorized under any instrument does not exceed 10% of the total assets of
ArcelorMittal and its subsidiaries on a consolidated basis. ArcelorMittal hereby agrees to furnish to the SEC, upon its request, a
copy of any instrument defining the rights of holders of long-term debt of ArcelorMittal or of its subsidiaries for which consolidated or
unconsolidated financial statements are required to be filed.
|
|
2.2
|
Description of ArcelorMittal securities registered pursuant to Section 12 of the Securities Exchange Act of 1934 (filed as
Exhibit 2.2
)
|
|
4.1*
|
Shareholder’s agreement dated as of August 13, 1997 among Ispat International N.V., LNM Holdings S.L. (renamed Ispat
International Investments S.L.) and Mr. Lakshmi N. Mittal (filed as Exhibit 4.3 to Mittal Steel Company N.V.’s annual report on Form
20-F for the year ended December 31, 2004 (File No. 001-14666), and incorporated by reference herein) and available at:
https://
|
|
4.2*
|
Memorandum of Understanding dated June 25, 2006 among Arcelor, Mittal Steel Company N.V. and Mr. and Mrs. Lakshmi N. Mittal
(filed as Exhibit 99.1 to Mittal Steel Company N.V.’s report on Form 6-K (File No. 001-14666) filed with the Commission on June 29,
2006, and incorporated by reference herein) and available at:
https://www.sec.gov/Archives/edgar/
|
|
4.3*
|
Supplemental Terms for 2018-2019 to the GMB PSU Plan effective May 9, 2018 (filed as Exhibit 4.13 to the annual report on Form
20-F filed on February 25, 2019) and available at
https://www.sec.gov/Archives/edgar/data/1243429/000124342919000005/
|
|
4.4*
|
Supplemental Terms for 2018-2019 to the ArcelorMittal Equity Incentive Plan effective May 9, 2018 (filed as Exhibit 4.14 to the
annual report on Form 20-F filed on February 25, 2019) and available at
https://www.sec.gov/Archives/edgar/
|
|
4.5*
|
Supplemental Terms for 2019-2020 Group Management Board Performance Share Units Plan effective December 12, 2019 (filed
as Exhibit 4.14 to the annual report on Form 20-F filed on March 3, 2020) and available at
https://www.sec.gov/Archives/edgar/
|
|
4.6*
|
Supplemental Terms for 2019-2020 Performance Share Units effective December 12, 2019 (filed as Exhibit 4.15 to the annual
report on Form 20-F filed on March 3, 2020) and available at
https://www.sec.gov/Archives/edgar/
|
|
4.7*
|
Supplemental Terms for 2020-2021 Group Management Board Performance Share Units Plan effective December 12, 2020 (filed
as Exhibit 4.13 to the annual report on Form 20-F filed on March 8, 2021) and available at
https://www.sec.gov/Archives/edgar/
|
|
4.8*
|
Supplemental Terms for 2020-2021 Restricted Share Units and Performance Share Units effective December 12, 2020 (filed as
Exhibit 4.14 to the annual report on Form 20-F filed on March 8, 2021) and available at
https://www.sec.gov/Archives/edgar/
|
|
4.9*
|
Supplemental Terms for 2021-2022 Group Management Board Performance Share Units Plan effective June 8, 2021 (filed as
Exhibit 4.13 to the annual report on Form 20-F filed on March 11, 2022) and available at
https://www.sec.gov/Archives/edgar/
|
|
4.10*
|
Supplemental Terms for 2021-2022 Restricted Share Units and Performance Share Units effective June 8, 2021 (filed as Exhibit
4.14 to the annual report on Form 20-F filed on March 11, 2022) and available at
https://www.sec.gov/Archives/edgar/
|
|
4.11*
|
ArcelorMittal Equity Incentive Plan effective June 8, 2021 (filed as Exhibit 4.15 to the annual report on Form 20-F filed on March 11,
2022) and available at
https://www.sec.gov/Archives/edgar/data/1243429/000124342922000009/a2021exhibit415.htm
.
|
|
4.12*
|
Supplemental Terms for 2022-2023 Group Management Board Performance Share Unit Plan effective May 04, 2022 (filed as
Exhibit 4.13 to the annual report on Form 20-F filed on March 8, 2023) and available at
https://www.sec.gov/Archives/edgar/
|
|
4.13*
|
Supplemental Terms for 2022-2023 Restricted Share Units and Performance Share Units effective May 04, 2022 (filed as Exhibit
4.14 to the annual report on Form 20-F filed on March 8, 2023) and available at
https://www.sec.gov/Archives/edgar/
|
|
4.14*
|
Supplemental Terms for 2023-2024 Restricted Share Units and Performance Share Units effective May 02, 2023 (filed as Exhibit
4.15 to the annual report on Form 20-F filed on February 28, 2024) and available at
https://www.sec.gov/Archives/edgar/
|
|
4.15
|
Supplemental Terms for 2024-2025 Restricted Share Units and Performance Share Units effective April 30, 2024 and filed as
|
|
4.16
|
|
|
8.1
|
List of Principal Subsidiaries available at
Exhibit 8.1.
|
|
11.1
|
|
188
|
12.1
|
Certifications of ArcelorMittal’s Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14(a) under the Exchange
Act and available at
Exhibit 12.1.
|
|
13.1
|
Certifications of ArcelorMittal’s Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14(b) under the Exchange
Act and Section 1350 of Chapter 63 of Title 18 of the United States Code and available at
Exhibit 13.1.
|
|
15.1
|
Consent of Ernst & Young S.A. available and at
Exhibit 15.1.
|
|
15.2
|
Mining consents for ArcelorMittal Mining Canada G.P. and available at
Exhibit 15.2
|
|
15.3
|
Mining consents for Baffinland and available at
Exhibit 15.3
|
|
15.4
|
Mining consent for Bosnia and available at
Exhibit 15.4
|
|
15.5
|
Mining consents for Brazil and available at
Exhibit 15.5
|
|
15.6
|
Mining consents for India and available at
Exhibit 15.6
|
|
15.7
|
Mining consents for Liberia and available at
Exhibit 15.7
|
|
15.8
|
Mining consent for Mexico (excluding Peña Colorada) and available at
Exhibit 15.8
|
|
15.9
|
Mining consent for Peña Colorada and available at
Exhibit 15.9
|
|
15.10
|
Mining consent for South Africa and available at
Exhibit 15.10
|
|
15.11
|
Mining consents for Ukraine iron ore operations and available at
Exhibit 15.11
|
|
97.1*
|
Compensation recovery policy (filed as Exhibit 97.1 to the annual report on Form 20-F filed on February 28, 2024) and available at
|
|
101.INS
|
XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are
embedded within the Inline XBRL document.
|
|
101.SCH
|
XBRL Taxonomy Extension Schema Document
|
|
101.CAL
|
Inline XBRL Taxonomy Extension Calculation Linkbase Document
|
|
101.DEF
|
Inline XBRL Taxonomy Extension Definition Linkbase Document
|
|
101.LAB
|
Inline XBRL Taxonomy Extension Label Linkbase Document
|
|
101.PRE
|
Inline XBRL Taxonomy Extension Presentation Linkbase Document
|
|
104
|
Cover Page Interactive Data File (embedded within the Inline XBRL document and contained in Exhibit 101)
|
*
Previously filed
189
SIGNATURES
The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the
undersigned to sign this annual report on its behalf.
|
ARCELORMITTAL
|
|
/s/ Henk Scheffer
|
|
Henk Scheffer
|
|
Company Secretary
|
Date: March 10, 2025
191
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and the Board of Directors of ArcelorMittal
Opinion on the Financial Statements
We have audited the accompanying consolidated statements of financial position of ArcelorMittal and subsidiaries (the Company) as of
December 31, 2024 and 2023, the related consolidated statements of operations, other comprehensive income, changes in equity and
cash flows for each of the three years in the period ended December 31, 2024, and the related notes (collectively referred to as the
"consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the
financial position of the Company at December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the
three years in the period ended December 31, 2024, in conformity with International Financial Reporting Standards as issued by the
International Accounting Standards Board.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB),
the Company’s internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control —
Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“2013 framework”) and our
report dated
March 10, 2025
expressed an unqualified opinion thereon.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an
opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the
PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the
applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to
error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial
statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining,
on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included
evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall
presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matters
The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements
that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are
material to the consolidated financial statements and (2) involved our especially challenging, subjective or complex judgments. The
communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole,
and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the
accounts or disclosures to which they relate.
192
Impairment of Goodwill, Intangible Assets and Property, Plant and Equipment
|
Description of the
Matter
|
The goodwill, property, plant and equipment (“PP&E”) and intangible assets balances of the
Company as of December 31, 2024, were $3,605 million, $33,311 million and $848 million,
respectively.
As explained in Note 5.3 to the consolidated financial statements, the Company reported no
impairment of goodwill, while an impairment of $116 million was recognized for PP&E during
2024.
As explained in Note 5.3 to the consolidated financial statements, the Company’s evaluation of
goodwill for impairment at the group of cash-generating units (“GCGU”) level, and PP&E as
part of the relevant CGU, involves a comparison of the recoverable amount of each GCGU or
CGU to the carrying amount. Key assumptions that had a significant impact on the Company’s
estimate of the recoverable amounts of GCGUs and CGUs, (“the Relevant GCGUs and
CGUs”), included future volumes of shipments, future selling prices, variable costs and
discount rate. Changes in these assumptions could have a significant impact on the
recoverable amount of a GCGU or CGU. There are significant judgments made by
management to estimate these assumptions, including as it relates to the impact of the war in
Ukraine, both specifically on the Company’s Ukrainian operations, and more broadly, the
impact of the war on the level of uncertainty associated with these assumptions. Furthermore,
there are significant judgments made by management to assess the existence of impairment
reversal indicator. When such indicator is identified, management also performs an estimate of
the recoverable amount of the impaired assets.
The estimate of the recoverable amount also considers the Company’s exposure to certain
climate related risks, which affect the estimates of the future cash flows. Where there is a legal
obligation in terms of carbon neutrality, the estimates of the future cash flows include the
decarbonization capital expenditure expected to be necessary to maintain the level of
economic benefits expected to be generated by the respective assets in the current condition.
For the jurisdictions where there is no legal obligation for carbon neutrality, the
decarbonization related uncertainty was reflected in the risk premiums in the discount rates
applied to determine the present value of the estimated future cash flows.
Auditing the recoverable amounts of the Relevant GCGUs and CGUs was complex and
required a high degree of auditor judgement and an increased extent of effort, including the
involvement of valuation specialists, due to the significant estimation uncertainty and
subjective nature of the assumptions used in the estimates, as described above.
|
193
|
How We Addressed
the Matter in Our
Audit
|
We obtained an understanding, evaluated the design and tested the operating effectiveness of
controls over management’s valuation methodology and assumptions used for the estimates
of future cash flows. For example, we evaluated controls over the Company’s forecasting
process used to develop the estimated future cash flows and controls over management’s
data included in the estimated future cash flows.
We evaluated management’s ability to reasonably estimate future cash flows by comparing
actual results to management’s historical forecasts. As it relates to future volume of
shipments, future selling prices and variable costs, we compared management’s estimates to
available external third-party data regarding demand, selling prices and raw material prices.
Specifically, as it relates to the estimate of the recoverable amount of ArcelorMittal Kryvyi Rih
CGU (representing the Company’s operations in Ukraine), we evaluated the reasonableness
of management’s assumption as it relates to the timing for the end of war and the length of the
post-war recovery period, by independently developing a reasonable range of point estimates
and comparing to management’s estimate.
With the assistance of our valuation specialists, we evaluated the effects of climate-related
matters, including their impact on risk premiums and discount rates by considering, among
other factors, current legislation and regulations related to carbon emissions, as well as the
Company’s ongoing initiatives to transition to lower-carbon operations. Also, as part of our
procedures, we compared expected decarbonization capital expenditures against approved
budgets and where applicable, costs incurred to date.
With the assistance of our valuation specialists, we evaluated the discounted cash flows
methodology and assessed the discount rates used in the value in use estimates, by
comparing to underlying source information, testing the mathematical accuracy of the
calculation, developing an independent range of estimates and comparing the discount rate
selected by management to our range.
We also evaluated the adequacy of the disclosures in Note 5.3 of the consolidated financial
statements.
|
Recoverability of Deferred Tax Assets (“DTAs”)
|
Description of the
Matter
|
The DTA balance as of December 31, 2024, was $8,942 million, which is primarily related to
the ArcelorMittal S.A. (parent company) tax integration. As explained in Note 10.4 to the
consolidated financial statements, ArcelorMittal S.A. has DTAs primarily related to tax losses
and other tax benefits carried forward. Under current tax law in Luxembourg, tax losses
accumulated before January 1, 2017, do not expire and are recoverable against future taxable
income. The assessment of the likelihood of future taxable profits being available, and
specifically the length of the forecast periods utilized, requires significant management
judgment.
Auditing the recognition of ArcelorMittal S.A.’s DTA balances is subjective because the
estimation requires significant judgment, including the availability of future taxable income
against which tax deductions represented by the DTA can be offset. In addition, auditing the
recognition of DTA balances that are supported by the expectation of future taxable income
arising beyond ArcelorMittal S.A.’s 5-year planning horizon required significant auditor
judgment and an increased effort.
|
194
|
How We Addressed
the Matter in Our
Audit
|
We obtained an understanding, evaluated the design and tested the operating effectiveness of
controls over the Company’s assessment of the recoverability of deferred tax assets. For
example, we tested controls over management’s review of the significant assumptions used in
estimating the projections of future taxable income, including management’s analysis of the
sensitivity of the length of the forecast periods to change, based on other reasonably likely
outcomes that would have a material effect on the recoverability of DTAs.
To test the recoverability of DTAs, among other procedures, we compared the projections of
future taxable income with the actual results of prior periods and, separately, against other
forecasted financial information prepared by the Company, such as that used in estimating the
recoverable amounts of the Relevant GCGUs and CGUs as described in the
‘Impairment of
Goodwill, Intangible Assets and Property, Plant and Equipment’
critical audit matter above. We
assessed the Company’s evaluation of the length of the forecast periods to utilize the DTA by
independently developing a reasonable range of point estimates and comparing to
management’s estimate. Additionally, we tested the completeness and accuracy of the existing
intragroup loan and external debt agreements used by management to forecast financial
income, the primary input to future taxable income, and we performed sensitivity analyses over
this forecast. Where relevant and with the assistance of our tax professionals, we also
evaluated management’s proposed tax planning strategies.
We also evaluated the adequacy of the disclosures in Note 10.4 of the consolidated financial
statements in respect of ArcelorMittal S.A.’s DTAs.
|
/s/
Ernst & Young
Société anonyme
Cabinet de révision agré
é
We have served as the Company’s auditor since 2022.
March 10
, 2025
195
|
Consolidated financial statements
|
|
ArcelorMittal and Subsidiaries
|
|
Consolidated Statements of Operations
|
|
(millions of U.S. dollar, except share and per share data)
|
|
Year ended December 31,
|
|||||||
|
Notes
|
2024
|
2023
|
2022
|
||||
|
Sales
|
4.1 and 12.1
|
|
|
|
|||
|
(including
2022, respectively)
|
|||||||
|
Cost of sales
|
4.2 and 12.2
|
|
|
|
|||
|
(including
and 2022, respectively)
|
|||||||
|
Gross margin
|
|
|
|
||||
|
Selling, general and administrative expenses
|
|
|
|
||||
|
Operating income
|
|
|
|
||||
|
Income from investments in associates, joint ventures and other investments
|
2.6
|
|
|
|
|||
|
Impairment of investments in associates, joint ventures and other investments
|
2.4.4 and 2.6
|
|
(
|
|
|||
|
Financing costs - net
|
6.2
|
(
|
(
|
(
|
|||
|
Income before taxes
|
|
|
|
||||
|
Income tax expense
|
10.1
|
|
|
|
|||
|
Net income (including non-controlling interests)
|
|
|
|
||||
|
Net income attributable to equity holders of the parent
|
|
|
|
||||
|
Net income attributable to non-controlling interests
|
|
|
|
||||
|
Net income (including non-controlling interests)
|
|
|
|
||||
|
Year ended December 31,
|
|||||||
|
2024
|
2023
|
2022
|
|||||
|
Earnings per common share (in U.S. dollar)
|
|||||||
|
Basic
|
|
|
|
||||
|
Diluted
|
|
|
|
||||
|
Weighted average common shares outstanding (in millions)
|
11.3
|
||||||
|
Basic
|
|
|
|
||||
|
Diluted
|
|
|
|
||||
The accompanying notes are an integral part of these consolidated financial statements.
196
|
Consolidated financial statements
|
|
ArcelorMittal and Subsidiaries
|
|
Consolidated Statements of Other Comprehensive Income
|
|
(millions of U.S. dollar, except share and per share data)
|
|
Year ended December 31,
|
|||||||||||
|
2024
|
2023
|
2022
|
|||||||||
|
Net income (including non-controlling interests)
|
|
|
|
||||||||
|
Items that can be recycled to the consolidated statements of operations
|
|||||||||||
|
Derivative financial instruments:
|
|||||||||||
|
(Loss) gain arising during the period
|
(
|
(
|
|
||||||||
|
Reclassification adjustments for loss (gain) included in the consolidated
statements of operations and financial position (basis adjustments)
|
(
|
|
(
|
||||||||
|
(
|
(
|
(
|
|||||||||
|
Exchange differences arising on translation of foreign operations:
|
|||||||||||
|
(Loss) gain arising during the period
|
(
|
|
(
|
||||||||
|
Reclassification adjustments for loss included in the consolidated
statements of operations
|
|
|
|
||||||||
|
(
|
|
(
|
|||||||||
|
Share of other comprehensive income related to associates and joint ventures
|
|||||||||||
|
(Loss) gain arising during the period
|
(
|
(
|
|
||||||||
|
Reclassification adjustments for gain included in the consolidated
statements of operations and financial position (basis adjustments)
|
(
|
(
|
(
|
||||||||
|
(
|
(
|
(
|
|||||||||
|
Income tax benefit (expense) related to components of other comprehensive
income that can be recycled to the consolidated statements of operations
|
|
|
(
|
||||||||
|
Items that cannot be recycled to the consolidated statements of
operations
|
|||||||||||
|
Investments in equity instruments at FVOCI:
|
|||||||||||
|
Gain (Loss) arising during the period
|
|
(
|
(
|
||||||||
|
Share of other comprehensive gain (loss) related to associates and joint
ventures
|
|
|
(
|
||||||||
|
|
(
|
(
|
|||||||||
|
Employee benefits - Recognized actuarial gain (loss)
|
|
(
|
|
||||||||
|
Share of other comprehensive (expense) income related to associates
and joint ventures
|
(
|
|
|
||||||||
|
|
(
|
|
|||||||||
|
Income tax (expense) benefit related to components of other comprehensive
income (loss) that cannot be recycled to the consolidated statements of
operations
|
(
|
|
(
|
||||||||
|
Total other comprehensive (loss) income
|
(
|
|
(
|
||||||||
|
Total other comprehensive (loss) income attributable to:
|
|||||||||||
|
Equity holders of the parent
|
(
|
|
(
|
||||||||
|
Non-controlling interests
|
(
|
|
(
|
||||||||
|
Total other comprehensive (loss) income
|
(
|
|
(
|
||||||||
|
Total comprehensive (loss) income
|
(
|
|
|
||||||||
|
Total comprehensive income attributable to:
|
|||||||||||
|
Equity holders of the parent
|
(
|
|
|
||||||||
|
Non-controlling interests
|
(
|
|
|
||||||||
|
Total comprehensive (loss) income
|
(
|
|
|
||||||||
The accompanying notes are an integral part of these consolidated financial statements.
197
|
Consolidated financial statements
|
|
ArcelorMittal and Subsidiaries
|
|
Consolidated Statements of Financial Position
|
|
(millions of U.S. dollar, except share and per share data)
|
|
December 31,
|
|||||
|
Notes
|
2024
|
2023
|
|||
|
ASSETS
|
|||||
|
Current assets:
|
|||||
|
Cash and cash equivalents
|
6.1.3
|
|
|
||
|
Restricted cash
|
6.1.3
|
|
|
||
|
Trade accounts receivable and other (including
2024 and 2023, respectively)
|
4.3 and 12.1
|
|
|
||
|
Inventories
|
4.4
|
|
|
||
|
Prepaid expenses and other current assets
|
4.5
|
|
|
||
|
Total current assets
|
|
|
|||
|
Non-current assets:
|
|||||
|
Goodwill and intangible assets
|
5.1 and 5.3
|
|
|
||
|
Property, plant and equipment and biological assets
|
5.2, 5.3 and 7
|
|
|
||
|
Investments in associates and joint ventures
|
2.4
|
|
|
||
|
Other investments
|
2.5
|
|
|
||
|
Deferred tax assets
|
10.4
|
|
|
||
|
Other assets
|
4.6
|
|
|
||
|
Total non-current assets
|
|
|
|||
|
Total assets
|
|
|
|||
|
LIABILITIES AND EQUITY
|
|||||
|
Current liabilities:
|
|||||
|
Short-term debt and current portion of long-term debt
|
6.1.2.1 and 7
|
|
|
||
|
Trade accounts payable and other (including
and 2023, respectively)
|
4.7 and 12.2
|
|
|
||
|
Short-term provisions
|
9.1
|
|
|
||
|
Accrued expenses and other liabilities
|
4.8
|
|
|
||
|
Income tax liabilities
|
|
|
|||
|
Total current liabilities
|
|
|
|||
|
Non-current liabilities:
|
|||||
|
Long-term debt, net of current portion
|
6.1.2.2 and 7
|
|
|
||
|
Deferred tax liabilities
|
10.4
|
|
|
||
|
Deferred employee benefits
|
8.2
|
|
|
||
|
Long-term provisions
|
9.1
|
|
|
||
|
Other long-term obligations
|
9.2
|
|
|
||
|
Total non-current liabilities
|
|
|
|||
|
Total liabilities
|
|
|
|||
|
Contingencies and commitments
|
9.3 and 9.4
|
||||
|
Equity:
|
11
|
||||
|
Common shares (no par value,
and
December 31, 2024 and 2023, respectively)
|
|
|
|||
|
Treasury shares (
respectively, at cost)
|
(
|
(
|
|||
|
Additional paid-in capital
|
|
|
|||
|
Retained earnings
|
|
|
|||
|
Reserves
|
(
|
(
|
|||
|
Equity attributable to the equity holders of the parent
|
|
|
|||
|
Non-controlling interests
|
|
|
|||
|
Total equity
|
|
|
|||
|
Total liabilities and equity
|
|
|
|||
The accompanying notes are an integral part of these consolidated financial statements.
198
|
Consolidated financial statements
|
|
ArcelorMittal and Subsidiaries
|
|
Consolidated Statements of Changes in Equity
|
|
(millions of U.S. dollar, except share and per share data)
|
|
Reserves
|
|||||||||||||||||||||||||
|
Items that can be recycled to
the Consolidated Statements
of Operations
|
Items that cannot be recycled to
the Consolidated Statements of
Operations
|
||||||||||||||||||||||||
|
Shares
1
|
Share
Capital
|
Treasury
Shares
|
Mandatorily
Convertible
Notes
|
Additional
Paid-in
Capital
|
Retained
Earnings
|
Foreign
Currency
Translation
Adjustments
|
Unrealized
Gains (Losses)
on Derivative
Financial
Instruments
relating to CFH
|
Unrealized
Gains (Losses)
on Investments
in Equity
Instruments at
FVOCI
|
Recognized
actuarial
(losses) gains
|
Equity
attributable
to the equity
holders of
the parent
|
Non-
controlling
interests
|
Total
Equity
|
|||||||||||||
|
Balance at December 31, 2021
|
|
|
(
|
|
|
|
(
|
|
|
(
|
|
|
|
||||||||||||
|
Net income (including non-controlling interests)
|
—
|
—
|
—
|
—
|
—
|
|
—
|
—
|
—
|
—
|
|
|
|
||||||||||||
|
Other comprehensive income (loss)
|
—
|
—
|
—
|
—
|
—
|
—
|
(
|
|
(
|
|
(
|
(
|
(
|
||||||||||||
|
Total comprehensive income (loss)
|
—
|
—
|
—
|
—
|
—
|
|
(
|
|
(
|
|
|
|
|
||||||||||||
|
Cancellation of shares
|
—
|
(
|
|
—
|
(
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
|
||||||||||||
|
Recognition of share-based payments
|
|
—
|
|
—
|
|
—
|
—
|
—
|
—
|
—
|
|
—
|
|
||||||||||||
|
Share buyback
|
(
|
—
|
(
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
(
|
—
|
(
|
||||||||||||
|
Dividend
|
—
|
—
|
—
|
—
|
—
|
(
|
—
|
—
|
—
|
—
|
(
|
(
|
(
|
||||||||||||
|
Put option ArcelorMittal Texas HBI
|
—
|
—
|
—
|
—
|
—
|
(
|
—
|
—
|
—
|
—
|
(
|
—
|
(
|
||||||||||||
|
Non-controlling interests relating to acquisitions
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
|
|
||||||||||||
|
Capital increase ArcelorMittal Liberia
|
—
|
—
|
—
|
—
|
—
|
(
|
—
|
—
|
—
|
—
|
(
|
|
|
||||||||||||
|
Other movements
|
—
|
—
|
—
|
—
|
—
|
(
|
—
|
—
|
(
|
—
|
(
|
|
|
||||||||||||
|
Balance at December 31, 2022
|
|
|
(
|
|
|
|
(
|
|
|
(
|
|
|
|
||||||||||||
|
Net income (including non-controlling interests)
|
—
|
—
|
—
|
—
|
—
|
|
—
|
—
|
—
|
—
|
|
|
|
||||||||||||
|
Other comprehensive income (loss)
|
—
|
—
|
—
|
—
|
—
|
—
|
|
(
|
(
|
(
|
|
|
|
||||||||||||
|
Total comprehensive income (loss)
|
—
|
—
|
—
|
—
|
—
|
|
|
(
|
(
|
(
|
|
|
|
||||||||||||
|
Cancellation of shares (note 11.1)
|
—
|
(
|
|
—
|
(
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
|
||||||||||||
|
Conversion of mandatorily convertible notes (note 11.2)
|
|
—
|
|
(
|
(
|
—
|
—
|
—
|
—
|
—
|
|
—
|
|
||||||||||||
|
Recognition of share-based payments (note 8.3)
|
|
—
|
|
—
|
(
|
—
|
—
|
—
|
—
|
—
|
|
—
|
|
||||||||||||
|
Share buyback (note 11.1)
|
(
|
—
|
(
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
(
|
—
|
(
|
||||||||||||
|
Dividend (notes 11.4 and 11.5)
|
—
|
—
|
—
|
—
|
—
|
(
|
—
|
—
|
—
|
—
|
(
|
(
|
(
|
||||||||||||
|
Disposal of Erdemir shares (note 2.5)
|
—
|
—
|
—
|
—
|
—
|
|
—
|
—
|
(
|
—
|
—
|
—
|
|
||||||||||||
|
Early redemption of mandatory convertible bonds (note 11.2)
|
—
|
—
|
—
|
—
|
—
|
(
|
—
|
—
|
—
|
—
|
(
|
(
|
(
|
||||||||||||
|
Mandatorily convertible bond extension (note 11.2)
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
(
|
(
|
||||||||||||
|
Capital increase ArcelorMittal Liberia (note 11.5.1)
|
—
|
—
|
—
|
—
|
—
|
(
|
—
|
—
|
—
|
—
|
(
|
|
|
||||||||||||
|
Other movements
|
—
|
—
|
—
|
—
|
—
|
(
|
—
|
—
|
|
—
|
(
|
|
(
|
||||||||||||
|
Balance at December 31, 2023
|
|
|
(
|
|
|
|
(
|
|
(
|
(
|
|
|
|
||||||||||||
|
Net income (including non-controlling interests)
|
—
|
—
|
—
|
—
|
—
|
|
—
|
—
|
—
|
—
|
|
|
|
||||||||||||
|
Other comprehensive (loss) income
|
—
|
—
|
—
|
—
|
—
|
—
|
(
|
(
|
|
|
(
|
(
|
(
|
||||||||||||
|
Total comprehensive (loss) income
|
—
|
—
|
—
|
—
|
—
|
|
(
|
(
|
|
|
(
|
(
|
(
|
||||||||||||
|
Recognition of share-based payments (note 8.3)
|
|
—
|
|
—
|
|
—
|
—
|
—
|
—
|
—
|
|
—
|
|
||||||||||||
|
Share buyback (note 11.1)
|
(
|
—
|
(
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
(
|
—
|
(
|
||||||||||||
|
Dividend (notes 11.4 and 11.5)
|
—
|
—
|
—
|
—
|
—
|
(
|
—
|
—
|
—
|
—
|
(
|
(
|
(
|
||||||||||||
|
Disposal of Erdemir shares (note 2.5)
|
—
|
—
|
—
|
—
|
—
|
|
—
|
—
|
(
|
—
|
—
|
—
|
|
||||||||||||
|
Increase in non-controlling interests in Finocas NV ( (note 11.5.2)
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
|
|
||||||||||||
|
Capital increase ArcelorMittal Liberia (note 11.5.1)
|
—
|
—
|
—
|
—
|
—
|
(
|
—
|
—
|
—
|
—
|
(
|
|
|
||||||||||||
|
Other movements
|
—
|
—
|
—
|
—
|
—
|
(
|
—
|
—
|
—
|
—
|
(
|
(
|
(
|
||||||||||||
|
Balance at December 31, 2024
|
|
|
(
|
|
|
|
(
|
|
(
|
(
|
|
|
|
||||||||||||
1.
Amounts are in millions of shares (treasury shares are excluded).
The accompanying notes are an integral part of these consolidated financial statements.
199
|
Consolidated financial statements
|
|
ArcelorMittal and Subsidiaries
|
|
Consolidated Statements of Cash Flows
|
|
(millions of U.S. dollar, except share and per share data)
|
|
Year ended December 31,
|
|||||||
|
Notes
|
2024
|
2023
|
2022
|
||||
|
Operating activities:
|
|||||||
|
Net income (including non-controlling interests)
|
|
|
|
||||
|
Adjustments to reconcile net income to net cash provided by operations:
|
|||||||
|
Depreciation and amortization
|
5.1 and 5.2
|
|
|
|
|||
|
Impairment charges
|
5.3
|
|
|
|
|||
|
Bargain purchase gain
|
2.2.4
|
|
|
(
|
|||
|
Interest expense
|
6.2
|
|
|
|
|||
|
Interest income
|
6.2
|
(
|
(
|
(
|
|||
|
Income tax expense
|
10.1
|
|
|
|
|||
|
Net loss on disposal of subsidiaries
|
2.3
|
|
|
|
|||
|
Income from investments in associates, joint ventures and other investments
|
2.6
|
(
|
(
|
(
|
|||
|
Impairment on investments in associates, joint ventures and other investments
|
2.6
|
|
|
|
|||
|
Provision on pensions and other post-employment benefits
|
8.2
|
|
|
|
|||
|
Unrealized foreign exchange effects
|
|
|
(
|
||||
|
Write-downs of inventories to net realizable value, provisions and other non-cash operating
expenses net
|
4.4
|
|
(
|
|
|||
|
Changes in assets and liabilities that provided (required) cash, net of acquisitions and disposals:
|
|||||||
|
Trade accounts receivable and other
|
4.1
|
(
|
|
|
|||
|
Inventories
|
4.4
|
|
|
(
|
|||
|
Trade accounts payable and other
|
4.7
|
|
(
|
(
|
|||
|
VAT and other amounts (paid) received to/from public authorities
|
(
|
|
(
|
||||
|
Other working capital and provisions movements
|
(
|
|
|
||||
|
Interest paid
|
(
|
(
|
(
|
||||
|
Interest received
|
|
|
|
||||
|
Income taxes paid
|
(
|
(
|
(
|
||||
|
Dividends received from associates, joint ventures and other investments
|
|
|
|
||||
|
Cash contributions to plan assets and benefits paid for pensions and other post-employment benefits
|
8.2
|
(
|
(
|
(
|
|||
|
Net cash provided by operating activities
|
|
|
|
||||
|
Investing activities:
|
|||||||
|
Purchase of property, plant and equipment and intangibles
|
(
|
(
|
(
|
||||
|
Disposals of net assets of subsidiaries, net of cash disposed of
and 2022, respectively
|
2.3
|
|
|
|
|||
|
Acquisitions of net assets of subsidiaries, net of cash acquired of
and 2022, respectively
|
2.2.4
|
(
|
(
|
(
|
|||
|
Disposals of property, plant and equipment and intangibles
|
5.1 and 5.2
|
|
|
|
|||
|
Acquisition of associates and joint ventures
|
2.4
|
(
|
(
|
|
|||
|
Proceeds from repayment of a loan in connection with the sale of ArcelorMittal Temirtau
|
2.3.1
|
|
|
|
|||
|
(Acquisitions) disposals of financial assets
|
2.5
|
|
|
(
|
|||
|
Other investing activities net
|
(
|
(
|
(
|
||||
|
Net cash used in investing activities
|
(
|
(
|
(
|
||||
|
Financing activities:
|
|||||||
|
Payments from mandatorily convertible subordinated notes/ mandatorily convertible bonds
|
11.2
|
|
(
|
|
|||
|
Transactions with non-controlling interests
|
11.5.2
|
|
|
|
|||
|
Proceeds from short-term debt
|
6.1.3
|
|
|
|
|||
|
Proceeds from long-term debt
|
6.1.3
|
|
|
|
|||
|
Payments of short-term debt
|
6.1.3
|
(
|
(
|
(
|
|||
|
Payments of long-term debt
|
6.1.3
|
(
|
(
|
|
|||
|
Share buyback
|
11.1
|
(
|
(
|
(
|
|||
|
Dividends paid (includes
2024, 2023 and 2022, respectively)
|
(
|
(
|
(
|
||||
|
Payment of principal portion of lease liabilities and other financing activities
|
6.1.3
|
(
|
(
|
(
|
|||
|
Net cash used in financing activities
|
(
|
(
|
(
|
||||
|
Net (decrease) increase in cash and cash equivalents
|
(
|
(
|
|
||||
|
Effect of exchange rate changes on cash
|
(
|
|
(
|
||||
|
Cash and cash equivalents:
|
|||||||
|
At the beginning of the year
|
|
|
|
||||
|
At the end of the year
|
|
|
|
||||
The accompanying notes are an integral part of these consolidated financial statements.
200
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
SUMMARY OF NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
NOTE 1: ACCOUNTING PRINCIPLES
|
|
|
1.1
|
Basis of presentation
|
|
1.2
|
Climate change disclosures
|
|
1.3
|
Use of judgment and estimates
|
|
1.4
|
Accounting standards applied
|
|
NOTE 2: SCOPE OF CONSOLIDATION
|
|
|
2.1
|
Basis of consolidation
|
|
2.2
|
Investments in subsidiaries
|
|
2.3
|
Divestments and assets held for sale
|
|
2.4
|
Investments in associates and joint arrangements
|
|
2.5
|
Other investments
|
|
2.6
|
Income (loss) from investments in associates, joint ventures and other investments
|
|
NOTE 3: SEGMENT REPORTING
|
|
|
3.1
|
Reportable segments
|
|
3.2
|
Geographical information
|
|
3.3
|
Sales by type of products
|
|
3.4
|
Disaggregated revenue
|
|
NOTE 4: OPERATING DATA
|
|
|
4.1
|
Revenue
|
|
4.2
|
Cost of sales
|
|
4.3
|
Trade accounts receivable and other
|
|
4.4
|
Inventories
|
|
4.5
|
Prepaid expenses and other current assets
|
|
4.6
|
Other assets
|
|
4.7
|
Trade accounts payable and other
|
|
4.8
|
Accrued expenses and other liabilities
|
|
NOTE 5: GOODWILL, INTANGIBLE AND TANGIBLE ASSETS
|
|
|
5.1
|
Goodwill and intangible assets
|
|
5.2
|
Property, plant and equipment and biological assets
|
|
5.3
|
Impairment of intangible assets, including goodwill, and tangible assets
|
|
NOTE 6: FINANCING AND FINANCIAL INSTRUMENTS
|
|
|
6.1
|
Financial assets and liabilities
|
|
6.2
|
Financing costs - net
|
|
6.3
|
Risk management policy
|
|
NOTE 7: LEASES
|
|
|
NOTE 8: PERSONNEL EXPENSES AND DEFERRED EMPLOYEE BENEFITS
|
|
|
8.1
|
Employees and key management personnel
|
|
8.2
|
Deferred employee benefits
|
|
8.3
|
Share-based payments
|
|
NOTE 9: PROVISIONS, CONTINGENCIES AND COMMITMENTS
|
|
|
9.1
|
Provisions
|
|
9.2
|
Other long-term obligations
|
|
9.3
|
Contingent liabilities
|
|
9.4
|
Commitments
|
201
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
NOTE 10: INCOME TAXES
|
|
|
10.1
|
Income tax expense
|
|
10.2
|
Income tax recorded directly in equity and/or other comprehensive income
|
|
10.3
|
Uncertain tax positions
|
|
10.4
|
Deferred tax assets and liabilities
|
|
10.5
|
Tax losses, tax credits and other tax benefits carried forward
|
|
NOTE 11: EQUITY
|
|
|
11.1
|
Share details
|
|
11.2
|
Equity instruments and hybrid instruments
|
|
11.3
|
Earnings per common share
|
|
11.4
|
Dividends
|
|
11.5
|
Non-controlling interests
|
|
NOTE 12: RELATED PARTIES
|
|
|
12.1
|
Sales and trade receivables
|
|
12.2
|
Purchases and trade payables
|
|
12.3
|
Other transactions with related parties
|
|
NOTE 13: SUBSEQUENT EVENTS
|
|
202
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
ArcelorMittal (“ArcelorMittal” or the “Company”), together with its
subsidiaries,
owns and operates steel manufacturing and mining
facilities
in
Europe, North and South America, Asia and Africa
.
Collectively, these subsidiaries and facilities are referred to in
the consolidated financial statements as the “operating
subsidiaries”.
These consolidated financial statements were
authorized for issuance on
March 10
, 2025 by the Company’s
The consolidated financial statements have been prepared on a
historical cost basis, except for equity instruments and certain
trade receivables at fair value through other comprehensive
income ("FVOCI"), financial assets at fair value through profit or
loss ("FVTPL"), derivative financial instruments and biological
assets, which are measured at fair value less cost to sell,
inventories, which are measured at the lower of net realizable
value or cost, and the financial statements of the Company’s
Venezuelan tubular production facilities Industrias Unicon CA
(“Unicon”) and the Company's Argentinian operation Acindar
Industria Argentina de Aceros S.A. ("Acindar"), for which
hyperinflationary accounting is applied (see note 2.2.2). The
consolidated financial statements have been prepared in
accordance with International Financial Reporting Standards
(“
IFRS
”) as issued by the International Accounting Standards
Board (“IASB”)
and are presented in U.S. dollar with all amounts
rounded to the nearest million, except for share and per share
data.
The Company continues to develop its assessment of the
potential impacts of climate change and the transition to a low
carbon economy and has considered such impacts when
preparing its consolidated financial statements. ArcelorMittal's
decarbonization strategy aims to achieve carbon neutrality by
2050 in line with the United Nations' Paris agreement. The
Company had previously announced the intention to invest in
lower carbon emissions “hydrogen ready” DRI-EAF facilities to
replace several blast furnaces across its European business, as
a key strategic first step towards reducing emissions. In all
cases, the host countries offered funding support for these
projects, with the approval of the European Commission. These
projects were premised on a favorable combination of policy,
technology and market developments that would facilitate
decarbonization investment by helping offset the significantly
higher capital and operating costs that this transition strategy
would involve. This included being able to use natural gas until
green hydrogen became competitive. However European policy,
energy and market environments have not moved in a favorable
direction. Green hydrogen is evolving very slowly towards being
a viable fuel source and natural gas based DRI production in
Europe is not yet competitive as an interim solution.
Furthermore, there are significant weaknesses in the carbon
border adjustment mechanism ("CBAM"), trade protection
measures need strengthening in response to increasing imports
due to China overcapacity, and there is limited willingness
among customers to pay premiums for low-carbon emissions
steel. Before taking final investment decisions, ArcelorMittal
considers that it is necessary to have full visibility on the policy
environment that will ensure higher cost steelmaking can be
competitive in Europe without a global carbon price. It expects
several important developments in 2025, including the
scheduled review of the CBAM, an anticipated review of the
steel safeguards, and the publication of the Steel and Metals
Action Plan. When complete, these initiatives will provide the
parameters needed to shape the business case for
decarbonization investments in Europe. In the meantime,
ArcelorMittal is continuing with engineering work, as well as
analyzing a phased approach that would first start with
constructing EAFs, which can also be fed with scrap steel to
significantly reduce emissions.
In May 2024, ArcelorMittal started the construction of an EAF for
long products at its Gijón plant, which is expected to produce its
first heat in the first quarter of 2026. This investment of €
213
will
be the first major EAF project to be implemented within the
Company’s decarbonization program in Europe and will
constitute the first step towards low-carbon emissions
steelmaking in Asturias. The new facility will have an annual
production capacity of
1.1
million
tonnes of semi-finished steel
products, which will be supplied to the rail and wire-rod mills at
the plant. Initially, steel production through the new EAF will lead
to a reduction in CO
2
emissions of over
35
%
; the reduction in
emissions could reach
1
million
tonnes of CO
2
equivalent a year
once the transition phase has been completed.
The longer timeline required for final investment decisions will
not impact the Company’s ability to meet customer demand for
low-carbon emissions steel.
There has been good progress with
the Company's efforts to increase production to
1.6
million
tonnes by 2026 at its flat products plant in Sestao where it has
emissions steel.
Longer term, the Company remains committed
to all technologies that offer the potential to take steelmaking to
near-zero. This includes carbon capture utilization and storage
("CCUS"), although like green hydrogen, this technology is likely
to only make a meaningful difference after 2030. It already has
one industrial scale CCU facility operational at its plant in Ghent,
Belgium, and a further
two
pilot projects underway in Ghent (see
below).
203
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
The Company's decarbonization roadmap also includes the
following sets of actions and initiatives that acts as stepping-
stones toward the goal of achieving net-zero carbon emissions
by 2050:
•
Increasing the proportion of scrap used in the steelmaking
process: the Company can increase the use of low-quality
scrap in the BF-BOF steelmaking process by improving
steel scrap sorting and classification, installing scrap pre-
melting technology, and adjusting the steelmaking process
to accommodate scrap. Since 2022, the Company has
completed the acquisition of
three
specialist scrap metal
recyclers as the Company continually seeks to enhance its
ability to source scrap steel (see note 2.2.4).
•
Transforming the energy used in the steelmaking process:
this is expected to involve shifting to one or a combination
of three alternatives: clean electricity (which could be in the
form of green hydrogen), CCU coupled with CCS to ensure
no carbon is emitted, and use of circular carbon either
through natural or synthetic carbon cycles. In November
2023, industrial production of ethanol commenced at
ArcelorMittal’s commercial flagship CCU facility in Ghent,
Belgium. The €
200
million Steelanol facility is a first of its
kind for the European steel industry, deploying technology
developed by leading carbon utilization company
LanzaTech. This facility captures carbon-rich waste gases
from steelmaking and biologically convert them into
advanced ethanol through LanzaTech’s biobased process.
•
Investing in clean electricity used in the steelmaking
process: The Company plans to look for more and varied
opportunities in the renewables sector to provide sufficient
access to clean energy at affordable prices, purchase
renewable energy certificates and make more use of direct
power purchase agreements with suppliers from
renewables projects. In June 2024, the ‘round the clock’
renewable energy project between ArcelorMittal and
Greenko Group, India's leading energy transition company,
began commissioning with power supply commenced in
September 2024. The
975
MW nominal capacity facility
represents a
0.7
billion investment and combines solar and
wind power. It is supported by Greenko’s hydro pumped
storage project, which helps to overcome the intermittent
nature of wind and solar power generation. The project
provides for uninterrupted renewable power to be supplied
annually to AMNS India (ArcelorMittal’s joint venture
company in India) resulting in over
20
%
of the electricity
requirement at AMNS India’s Hazira plant coming from
renewable sources, reducing carbon emissions by
approximately
1.5
million tonnes per year. In May 2023,
ArcelorMittal formed a joint venture with Casa dos Ventos,
one of Brazil’s largest developers and producers of
renewable energy projects, to develop a
554
MW wind
power project aiming to secure and decarbonize a
considerable proportion of the Company's wholly-owned
subsidiary ArcelorMittal Brasil’s future electricity needs and
which is
set to be commissioned in 2025
.
In August 2024,
ArcelorMittal Brasil also signed contracts with Casa dos
Ventos and Atlas Renewable Energy for the development of
capacity of
465
MW, equivalent to
14
%
of its current
electricity requirements in Brazil.
Project commissioning is
expected before the end of
2025
.
Considering
the risks related to climate change and the
Company's commitment established under the Paris agreement,
ArcelorMittal provides explicit information in the notes to these
consolidated financial statements regarding how climate change
affects the Company's financial information. The Company
presents below the references to the various notes where issues
associated with climate change are addressed:
204
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
Topic
|
Note
|
Content
|
|
Estimate and judgment
|
Note 1.3 Use of judgment and
estimates
|
Judgments and estimates made in assessing the impact of climate change and the
transition to a low carbon economy: useful lives of property, plant and equipment,
estimates of future cash flow projections for impairment of non-financial assets,
decommissioning costs, renewable power purchase agreements
|
|
Sustainable investment
|
•
Note 2.2.4 Acquisitions
•
Note 2.4.1 Joint ventures
•
Note 2.5 Other investments
•
Note 5.2 Property, plant and
equipment and biological
•
Note 9.4 Commitments
|
Investments in renewable energy projects, scrap metal recycling businesses and
breakthrough technologies through ArcelorMittal XCarb® Innovation Fund,
renewable power purchase agreements
|
|
Measurement of non-
financial assets
|
Note 5.1 Goodwill and intangible
assets
|
Recognition and measurement of emission rights
|
|
Note 5.2 Property, plant and
equipment and biological assets
|
Residual useful lives of certain assets, capital expenditures with respect to
decarbonization strategy
|
|
|
Note 5.3 Impairment of intangible
assets, including goodwill, and
tangible assets
|
Inclusion of climate-related risks in the assumptions for impairment testing
|
|
|
Provisions
|
Note 9.1 Provisions
|
Recognition of emission obligations
|
|
Share-based payments
|
Note 8.3 Share-based payments
|
Description of equity incentive plans requiring achievement of specific climate-
related targets
|
The preparation of consolidated financial statements in
conformity with IFRS recognition and measurement principles
and, in particular, making the critical accounting judgments
requires the use of estimates and assumptions that affect the
reported amounts of assets, liabilities, revenues and expenses.
Management reviews its estimates on an ongoing basis using
currently available information. Changes in facts and
circumstances or obtaining new information or more experience
may result in revised estimates, and actual results could differ
from those estimates.
Company’s critical accounting policies under which significant
judgments, estimates and assumptions are made. It should be
read in conjunction with the notes mentioned in the summary:
Deferred tax assets (note 10.4)
: The Company assesses the
recoverability of deferred tax assets based on future taxable
income projections, which are inherently uncertain and may be
subject to changes over time. Judgment is required to assess
the impact of such changes on the measurement of these
assets and the time frame for their utilization. In addition, the
Company applies judgment to recognize income tax liabilities
when they are probable and can be reasonably estimated
depending on the interpretation, which may be uncertain, of
applicable tax laws and regulations. ArcelorMittal periodically
reviews its estimates to reflect changes in facts and
circumstances.
Provisions for pensions and other post-employment benefits
(note 8.2)
: Benefit obligations and plan assets can be subject to
significant volatility, in particular due to changes in market
conditions and actuarial assumptions. Such assumptions differ
by plan, take local conditions into account and include discount
rates, expected rates of compensation increases, health care
cost trend rates, mortality and retirement rates. They are
determined following a formal process involving the Company's
expertise and independent actuaries. Assumptions are reviewed
annually and adjusted following actuarial and experience
changes.
Provisions (note 9)
: Provisions, which result from legal or
constructive obligations arising as a result of past events, are
recognized based on the Company's, and in certain instances,
third-party's best estimate of costs when the obligation arises.
They are reviewed periodically to take into consideration
changes in laws and regulations and underlying facts and
circumstances.
Impairment of tangible and intangible assets, including goodwill
and impairment reversal (note 5.3)
:
I
n order to assess the
recoverable amount of tangible assets, intangible assets and
goodwill, the Company mainly determines their value in use on
the basis of the present value of cash flow projections.
The
estimates, judgments and assumptions applied for the value in
use calculations relate primarily to growth rates, expected
changes to average selling prices, shipments and direct costs.
Assumptions for average selling prices and shipments are
based on historical experience and expectations of future
changes in the market. When determining value in use,
management also applies judgement when assessing whether
cash flows expected to arise to achieve sustainability and
decarbonization targets are deemed to maintain the same level
of economic benefits or whether they improve or enhance the
205
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
asset's performance (see also below
judgments and estimates
made in assessing the impact of climate change and the
transition to a low carbon economy)
. Discount rates are
reviewed annually.
Impairment of associates and joint ventures (note 2.4.4.)
:
Whenever there is an indication of impairment related to
investments accounted for under the equity method, the
Company performs an impairment test based, amongst others,
on an estimate of its share in the present value of the projected
future cash flows expected to be generated by operations of
associates and joint ventures and, similarly to impairment
testing of tangible and intangible assets, including goodwill, t
he
estimates, judgments and assumptions applied for the value in
use calculations relate primarily to growth rates, expected
changes to average selling prices, shipments and direct costs.
Assumptions for average selling prices and shipments are
based on historical experience and expectations of future
changes in the market.
Business combinations (note 2.2.3)
: Assets acquired and
liabilities assumed as part of a business combination are
recorded at their acquisition-date fair values. Similarly,
consideration including consideration receivable and contingent
consideration is measured at fair value. In connection with each
of its acquisitions, the Company undertakes a process to identify
all assets and liabilities acquired, including intangible assets.
Determining the fair value of identifiable assets and liabilities
requires the use of valuation techniques which may include
judgment and estimates and which may affect the allocation of
the amount of consideration paid to the assets and liabilities
acquired and goodwill or gain from a bargain purchase recorded
as part of the business combination. Estimated fair values are
based on information available at acquisition date and on
expectations and assumptions that have been deemed
reasonable by management. There are several methods that
can be used to determine the fair value of assets acquired and
liabilities assumed. The "income approach" is based on the
forecast of the expected future cash flows adjusted to present
value by applying an appropriate discount rate that reflects the
risk factors associated with the cash flow streams. Some of the
more significant estimates and assumptions inherent in the
income method or other methods include the amount and timing
of projected future cash flows; the discount rate selected to
measure the risks inherent in the future cash flows (weighted
average cost of capital); the assessment of the asset's life cycle
and the competitive trends impacting the asset, including
consideration of any technical, legal, regulatory or economic
barriers to entry. The "cost approach" estimates the value of an
asset based on the current cost to reproduce of replace the
asset. Replacement cost is determined based on market data
subsequently adjusted for physical, functional and economic
obsolescence. The most common purchase accounting
adjustments relate to the following assets and liabilities:
•
The fair value of identifiable intangible assets (generally
patents, customer relationships, technology, brand or
favorable contracts) is estimated based on the above-
mentioned income approach;
•
Property, plant and equipment is recorded at market value,
or, if not available, depreciated replacement cost;
•
The fair value of pension and other post-employment
benefits is determined separately for each plan using
actuarial assumptions valid as of the acquisition date
relating to the population of employees involved and the fair
value of plan assets.
•
Inventories are estimated based on expected selling prices
at the date of acquisition reduced by an estimate of selling
expenses and a normal profit margin.
•
Adjustments to deferred tax assets and liabilities of the
acquiree are recorded to reflect the deferred tax effects of
the fair value adjustments relating to identifiable assets and
liabilities other than goodwill.
Determining the estimated residual useful lives of tangible and
intangible assets acquired requires judgement and certain
intangible assets may be considered to have indefinite useful
lives.
Financial instruments (note 6.1.5) and financial amounts
receivable (note 4.5 and 4.6)
: Certain of the Company's financial
instruments are classified as Level 3 as they include
unobservable inputs.
Mineral reserve and resource estimates (note 5.2)
: Proven iron
ore reserves are those quantities whose recoverability can be
determined with reasonable certainty from a given date forward
and under existing government regulations, economic and
operating conditions; probable reserves have a lower degree of
assurance but high enough to assume continuity between points
of observation. Mineral resource estimates constitute the part of
a mineral deposit that have the potential to be economically and
legally extracted or produced at the time of the resource
determination. The potential for economic viability is established
through qualitative evaluation of relevant technical and
economic factors likely to influence the prospect of economic
extraction. A measured mineral resource is that part of a mineral
resource for which quantity, grade or quality, densities, shape,
and physical characteristics are so well established that they
can be estimated with confidence sufficient to allow the
appropriate application of technical and economic parameters,
to support production planning and evaluation of the economic
viability of the deposit. The estimate is based on detailed and
206
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
reliable exploration, sampling and testing information gathered
through appropriate techniques from locations such as outcrops,
trenches, pits, workings and drill holes that are spaced closely
enough to confirm both geological and grade continuity. An
indicated mineral resource is that part of a mineral resource for
which quantity, grade or quality, densities, shape and physical
characteristics, can be estimated with a level of confidence
sufficient to allow the appropriate application of technical and
economic parameters, to support mine planning and evaluation
of the economic viability of the deposit. The estimate is based
on detailed and reliable exploration sampling and testing
information gathered through appropriate techniques from
locations such as outcrops, trenches, pits, workings and drill
holes that are spaced closely enough for geological and grade
continuity to be reasonably assumed. An inferred mineral
resource is that part of a mineral resource for which quantity and
grade or quality can be estimated on the basis of geological
evidence and limited sampling, and reasonably assumed but not
verified geological and grade continuity. The estimate is based
on limited information and sampling gathered through
appropriate techniques from locations such as outcrops,
trenches, pits, workings and drill holes. Estimates of mineral
reserves and resources and the estimates of mine life have
been prepared by ArcelorMittal experienced engineers and
geologists and detailed independent verifications of the methods
and procedures are conducted on a regular basis by external
consultants. Reserves and resources are updated annually and
calculated using a reference price duly adjusted for quality, ore
content, logistics and other considerations. In order to estimate
reserves and resources, estimates are required for a range of
geological, technical and economic factors, including quantities,
grades, production techniques, recovery rates, production costs,
transport costs, commodity demand, commodity prices and
exchange rates. Estimating the quantity and/or grade of
reserves and resources requires the size, shape and depth of
ore bodies to be determined by analyzing geological data such
as drilling samples. This process may require complex and
difficult geological judgments to interpret the data. Because the
economic assumptions used to estimate reserves and resources
change from period to period, and because additional geological
data is generated during the course of operations, estimates of
reserves and resources may change from period to period.
Judgments and estimates made in assessing the impact of
climate change and the transition to a low carbon economy
Assumptions in respect of climate change and the transition to a
low carbon economy may impact the Company’s significant
judgements and key estimates and result in material changes to
financial results and the carrying values of certain assets and
liabilities in future reporting periods. The main judgements and
estimates made by ArcelorMittal when preparing the
2024
consolidated financial statements with respect to the expected
effects of climate change and the transition to a low carbon
economy are described below.
•
Property, plant and equipment
: Considering the expected
date of retirement of some assets in particular certain blast
furnaces, basic oxygen furnaces, sinter plants and coke
plants following investments in low-carbon steelmaking
technologies, the Company
decreased
estimates of residual
useful lives of such items of property, plant and equipment
for its flat steel operations in the EU and in Canada.
•
Impairment of tangible and intangible assets, including
goodwill:
Value in use calculations relating to flat steel
operations in the EU and in Canada, which apply the BF-
BOF route, include the impact of decarbonization at the
level of cash flow projections
as decarbonization is
necessary to maintain the level of economic benefits
expected to arise from the assets in their current condition
considering the legal obligation of carbon neutrality for
these operations
; accordingly the Company developed
assumptions in determining related capital expenditures
which reflect announced commitments and initiatives in
place, costs associated with operating the new technologies
which are expected to be deployed in the short to medium
term, commodity prices and carbon emission costs on the
basis of historical experience and expectations of future
changes. This requires to assess the future development in
supply, technology change, production changes and other
important factors. For other operations, discount rates are
increased to include a risk premium relative to the future
estimated decarbonization cost.
Due to economic
developments, uncertainties over the pace of transition to
low-emission technologies, political and environmental
actions that will be taken to meet the carbon reduction
goals, regulatory changes and emissions activity arising
from climate-related matters, the Company’s assumptions
used in the recoverable amount calculations, such as
capital expenditure, carbon emission costs, level of public
funding and other assumptions are inherently uncertain,
which could result in significant changes to value in use
calculations in future periods and affect impairment
assessments.
•
Decommissioning costs
: Over the next ten years, the
retirement of certain above-mentioned assets in the context
of the transition to low-carbon steelmaking infrastructures
may lead to certain decommissioning costs. The Company
considered such costs in its value in use calculations but it
has not recognized decommissioning provisions related to
decarbonization as the obligating event has not occurred
yet. Decommissioning cost estimates are based on the
known regulatory and external environment. These cost
estimates may change in the future including as a result of
the transition to a lower carbon economy.
207
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
•
Renewable power purchase
agreements
:
The Company
enters into power purchase agreements ("PPAs"), which
provide for the physical delivery of renewable energy and
enable ArcelorMittal to reduce its indirect emissions (Scope
2) related to energy purchases. The Company analyzes the
accounting treatment for such contracts based on their
relevant terms. When they do not comply either with the
requirements of IFRS 10 for the existence of control or
IFRS 11 for joint control over a
company or
regarding the
existence of joint operation over an asset, IFRS 16 for the
recognition of a lease, or with the definition of a derivative
under IFRS 9, they are accounted for as an executory
contract on the basis of the own use exemption when the
relevant conditions are met (see note 9.4). Virtual PPAs
including a cash settlement based on the difference
between the contract price and the market price are
recognized as financial instruments in accordance with
IFRS
9
.
Situation in Ukraine and collateral consequences
The Company's operations in Ukraine consist of a steel plant,
which produced
1.6
million tonnes of steel
(mainly billets,
rebars, wire rods, light sections and merchant bars)
in 2024 (
1.0
million tonnes in 2023), and (captive) mines that produced
7.8
million tonnes of iron ore in 2024 (
4.6
million tonnes in 2023);
the related carrying amount of property, plant and equipment
remained unchanged at
0.7
billion on the Company’s statement
of financial position at December 31, 2024 as compared to
December 31, 2023. In 2024, the Company’s Ukrainian
operations (and in particular its Kryvyi Rih steel plant) recorded
generating
1.6
billion of sales (
1.2
billion in 2023) including
0.5
billion of sales (
0.5
billion in 2023) to customers located in
Uk
raine.
Following the war outbreak on February 24, 2022, the Company
idled its Ukrainian operations on March 3, 2022 but restarted
blast furnace No.6 (
one
of the
three
blast furnaces representing
approximately
20
%
of ArcelorMittal's Kryvyi Rih ("AMKR") pig
iron capacity) on April 11, 2022 to resume low levels of pig iron
production. Iron ore production was approximately at
55
%
of
capacity during the first half of 2022. During the third quarter,
iron ore production was temporarily suspended due to weaker
demand and logistic constraints but restarted in early October
2022 at approximately
25
%
level. During the first half of 2023,
the Company continued to ramp up operations and operated
restart of blast furnace No.8 on April 14, 2023. On June 6, 2023,
following the destruction of the Nova Kakhovka reservoir's dam,
AMKR temporarily suspended steelmaking and production of
rolled products to reduce water consumption. As a result, the
Company shut down blast furnace No.6 slightly earlier than
planned for a major planned repair but continued to operate
blast furnace No.8. In July 2023, AMKR announced that it had
completed the construction of a new pumping station and
5
kilometers pipeline to supply water to the city and to ensure full
coverage of its production needs. In
November 2024,
AMKR
stopped blast furnace No. 6 following its restart in April 2024
after completion of repair. AMKR is currently operating its open
pit mining and steel facilities at
75
%
and
23
%
, respectively.
ArcelorMittal continued to exercise control over its Ukrainian
operations and
key production assets have not been seriously
damaged
at the date of this report
. In addition,
despite the lower
level of activity,
none
of the assets are held for sale or were
discontinued.
In the context of the annual impairment test of intangible
assets, including goodwill, and tangible assets, the Company
revised its future cash flow projections and considering that
there is significant uncertainty about the evolution of the
geopolitical context in Ukraine and the timing and ability for the
Company to resume production to a normal level, which resulted
in a substantial increase in the discount rate, ArcelorMittal
recognized in 2022 a
1,026
impairment loss of property, plant
and equipment and intangibles (see note 5.3). In 2024, the
Company
applied in its value in use calculation separate
discount rates over the discrete projections period, including a
higher country risk premium for the cash flow projections until
the end of 2025 and a return to a pre-war country risk premium
after 2025 and for the terminal value calculation (see note 5.3)
as value in use is sensitive to a difference in country risk for
different periods. It concluded that the recoverable amount
remains in excess of the carrying amount. Conversely, if the
ongoing conflict between Russia and Ukraine persists, it could
continue to have a material effect on the overall macroeconomic
environment potentially affecting steel and iron ore demand and
prices as well as energy costs. It could also result in further
reduced production, sales and income with respect to the
Company's Ukrainian operations thus increasing the risk that
the Company may need to record an additional impairment
charge with respect to such operations in the future.
The increased geopolitical risks induced by the war in Ukraine
have adversely impacted global macroeconomic conditions
leading to inflationary pressure, rising interest rates and energy
costs since early 2022. In 2023, while energy prices declined
and inflationary pressure started to dissipate, high interest rates
continued to constrain activity. As of October 1, 2024, when
goodwill was tested for impairment, discount rates applied for
value in use calculations included lower country risk premiums,
in particular in Ukraine,
while
the higher risk-free rate remained
relatively stable as compared to October 1, 2023. While the
Company expects near-term demand to remain subdued, given
the low inventory environment, especially in Europe, it expects
restocking activity to supplement real demand improvement in
time.
208
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
1.4 Accounting standards applied
interpretations applicable from January 1, 2024
On January 1, 2024, the Company adopted the narrow-scope
amendments to IAS 1 which clarify how to classify debt and
other liabilities as current or non-current. The amendments aim
to promote consistency in applying the requirements by helping
companies to determine whether, in the statement of financial
position, debt and other liabilities with an uncertain settlement
date should be classified as current (due or potentially due to be
settled within one year) or non-current. The amendments
include clarifications about the classification requirements for
debt a company might settle by converting it into equity.
In addition, on January 1, 2024, the Company adopted the
following amendments:
•
'Non-current Liabilities with Covenants (Amendments to IAS
1)' to clarify how conditions with which an entity must
comply within twelve months after the reporting period
affect the classification of a liability.
•
Amendments to IFRS 16
'
Leases
'
with respect to the lease
liability in a sale and leaseback transaction. The
amendments require a seller-lessee to subsequently
measure lease liabilities arising from a leaseback in a way
that it does not recognize any amount of the gain or loss
that relates to the right of use it retains. The new
requirements do not prevent a seller-lessee from
recognizing in profit or loss any gain or loss relating to the
partial or full termination of a lease.
•
'Supplier Finance Arrangements (Amendments to IAS 7 and
IFRS 7)' to add disclosure requirements, and ‘signposts’
within existing disclosure requirements, which require
entities to provide qualitative and quantitative information
about supplier finance arrangements. In particular, entities
will have to disclose in the notes information that enables
users of financial statements to (i) assess how supplier
finance arrangements affect an entity’s liabilities and cash
flows and to (ii) understand the effect of supplier finance
arrangements on an entity’s exposure to liquidity risk and
how the entity might be affected if the arrangements were
no longer available to it.
The adoption of these amendments did not have a material
impact to the Company's consolidated financial
statements
.
The Company has adopted
'
International Tax Reform – Pillar
Two Model Rules (Amendments to IAS 12)
'
upon release on
May 23, 2023. The amendments provided a temporary
mandatory exception from deferred tax accounting for the top-up
tax, which was effective immediately, and required new
disclosures about the Pillar Two exposure as of December 31,
2023.
The
Company has applied a temporary mandatory relief
from deferred tax accounting for the impacts
of
the top-up tax
and accounts for it as a current tax when incurred.
1.4.2 New IFRS standards, amendments and interpretations
applicable from 2025 onward
On August 15, 2023, the IASB published 'Lack of
Exchangeability (Amendments to IAS 21)' that contains
guidance to specify when a currency is exchangeable and how
to determine the exchange rate when it is not and how an entity
determines the exchange rate to apply when a currency is not
exchangeable. The amendments also require the disclosure of
additional information when a currency is not exchangeable.
The amendments are effective for annual periods beginning on
or after January 1, 2025 with early adoption permitted. The
amendments do not apply retrospectively. An entity recognizes
any effect of initially applying the amendments as an adjustment
to the opening balance of retained earnings when the entity
reports foreign currency transactions. When an entity uses a
presentation currency other than its functional currency, it
recognizes the cumulative amount of translation differences in
equity.
On April 9, 2024, the IASB published IFRS 18 'Presentation and
Disclosure in Financial Statements' which includes requirements
for all entities applying IFRS for the presentation and disclosure
of information in financial statements. The objective of IFRS 18
is to set out requirements for the presentation and disclosure of
information in general purpose financial statements (financial
statements) to help ensure they provide relevant information
that faithfully represents an entity’s assets, liabilities, equity,
income and expenses. Retrospective application of the standard
is mandatory for annual reporting periods starting from January
1, 2027 onwards but earlier application is permitted.
On May 9, 2024, the IASB published IFRS 19 'Subsidiaries
without Public Accountability: Disclosures' which specifies
reduced disclosure requirements that an eligible entity is
permitted to apply instead of the disclosure requirements in
other IFRS Accounting Standards. IFRS 19 is effective for
reporting periods beginning on or after January 1, 2027. Earlier
application is permitted.
On May 30, 2024, t
he
IASB issued 'Amendments to the
Classification and Measurement of Financial Instruments
(Amendments to IFRS 9 and IFRS 7)' to address matters
identified during the post-implementation review of the
classification and measurement requirements of IFRS 9
'Financial Instruments'. The amendments relate to derecognition
of a financial liability settled through electronic transfer,
classification of financial assets and disclosures.
The
amendments are effective for reporting periods beginning on or
after January 1, 2026. Earlier application of either all the
209
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
amendments at the same time or only the amendments to the
classification of financial assets is permitted.
On July 18, 2024, the IASB issued
'
Annual Improvements—
Volume 11
' including minor
amendments of
IFRS 1 'First-time
Adoption of International Financial Reporting Standards', IFRS 7
'Financial Instruments: Disclosures', IFRS 9 'Financial
Instruments', IFRS 10 'Consolidated Financial Statements' and
IAS 7 'Statement of Cash Flows'.
On December 18, 2024, the IASB issued 'Contracts Referencing
Nature-dependent Electricity – Amendments to IFRS 9 and
IFRS 7', which amend the own-use requirements in IFRS 9 to
include the factors an entity is required to consider for contracts
to buy and take delivery of renewable electricity for which the
source of production of the electricity is nature-dependent. The
hedge accounting requirements in IFRS 9 are also amended to
permit an entity using a contract for nature-dependent
renewable electricity with specified characteristics as a hedging
instrument to designate a variable volume of forecast electricity
transactions as the hedged item if specified criteria are met and
to measure the hedged item using the same volume
assumptions as those used for the hedging instrument. The
amendments are effective for annual reporting periods
beginning on or after January 1, 2026. Early application is
permitted.
Except for the adoption of IFRS 18, for which the Company is
still
assessing
the potential impact to its consolidated financial
statements, ArcelorMittal does not expect that the adoption of
the above-mentioned standards and amendments will have a
material
impact
to its consolidated financial statements.
The
Company does not plan to early adopt any standards or
amendments.
The consolidated financial statements include the accounts of
the Company, its subsidiaries and its interests in associated
companies and joint arrangements. Subsidiaries are
consolidated from the date the Company obtains control
(ordinarily the date of acquisition) until the date control ceases.
The Company controls an entity when the Company is exposed
to or has rights to variable returns from its involvement with the
entity and has the ability to affect those returns through its
the ability to exercise significant influence on the financial and
operating policy decisions, which it does not control. Generally,
significant influence is presumed to exist when the Company
holds more than 20% of the voting rights. Joint arrangements,
which include joint ventures and joint operations, are those over
whose activities the Company has joint control, typically under a
contractual arrangement. In joint ventures, ArcelorMittal
exercises joint control and has rights to the net assets of the
arrangement. The investment is accounted for under the equity
method and therefore recognized at cost at the date of
acquisition and subsequently adjusted for ArcelorMittal’s share
in undistributed earnings or losses since acquisition, less any
impairment incurred. Any excess of the cost of the acquisition
over the Company’s share of the net fair value of the identifiable
assets, liabilities, and contingent liabilities of the associate or
joint venture recognized at the date of acquisition is considered
as goodwill. The goodwill, if any, is included in the carrying
amount of the investment and is evaluated for impairment as
part of the investment. The consolidated statements of
operations include the Company’s share of the profit or loss of
associates and joint ventures from the date that significant
influence or joint control commences until the date significant
influence or joint control ceases and any impairment losses.
Adjustments to the carrying amount may also be necessary for
changes in the Company’s proportionate interest in the investee
arising from changes in the investee’s equity that have not been
recognized in the investee’s profit or loss. The Company’s share
of those changes is recognized directly in the relevant reserve
within equity.
The Company assesses the recoverability of its investments
accounted for under the equity method whenever there is an
indication of impairment. In determining the value in use of its
investments, the Company estimates its share in the present
value of the projected future cash flows expected to be
generated by operations of associates and joint ventures (see
also note 2.4.4).
For investments in joint operations, in which ArcelorMittal
exercises joint control and has rights to the assets and
obligations for the liabilities relating to the arrangement, the
Company recognizes its assets, liabilities and transactions,
operating subsidiaries do not have the ability to exercise
significant influence, are accounted for as investments in equity
instruments at FVOCI with any resulting gain or loss, net of
related tax effect, recognized in the consolidated statements of
other comprehensive income. Realized gains and losses from
the sale of investments in equity instruments at FVOCI are
reclassified from other comprehensive income to retained
While there are certain limitations on the Company’s operating
and financial flexibility arising from the restrictive and financial
covenants of one of the Company’s credit facilities described in
note 6.1.2, there are no significant restrictions resulting from
borrowing agreements or regulatory requirements on the ability
210
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
of consolidated subsidiaries, associates and jointly controlled
entities to transfer funds to the parent in the form of cash
dividends to pay commitments as they come due.
expenses and dividends, are eliminated in the consolidated
financial statements. Gains and losses resulting from
intercompany transactions are also eliminated.
Non-controlling interests represent the portion of profit or loss
and net assets not held by the Company and are presented
separately in the consolidated statements of operations, in the
consolidated statements of other comprehensive income and
211
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
2.2 Investments in subsidiaries
The table below provides a list of the Company’s principal operating subsidiaries at
December 31, 2024
. Unless otherwise stated, the
subsidiaries listed below have share capital consisting solely of ordinary shares or voting interests in the case of partnerships, which are
held directly or indirectly by the Company and the proportion of ownership interests held equals to the voting rights held by the
Company.
The
country of incorporation corresponds to their principal place of operations.
|
Name of Subsidiary
|
Country
|
% of Ownership
|
||
|
North America
|
||||
|
ArcelorMittal Dofasco G.P.
|
Canada
|
|
||
|
ArcelorMittal México S.A. de C.V.
|
Mexico
|
|
||
|
ArcelorMittal Long Products Canada G.P.
|
Canada
|
|
||
|
ArcelorMittal Texas HBI LLC
|
USA
|
|
||
|
Brazil and neighboring countries ("Brazil")
|
||||
|
ArcelorMittal Brasil S.A.
|
Brazil
|
|
||
|
Acindar Industria Argentina de Aceros S.A. ("Acindar")
|
Argentina
|
|
||
|
ArcelorMittal Pecém
|
Brazil
|
|
||
|
Europe
|
||||
|
ArcelorMittal France S.A.S.
|
France
|
|
||
|
ArcelorMittal Belgium N.V.
|
Belgium
|
|
||
|
ArcelorMittal España S.A.
|
Spain
|
|
||
|
ArcelorMittal Flat Carbon Europe S.A.
|
Luxembourg
|
|
||
|
ArcelorMittal Poland S.A.
|
Poland
|
|
||
|
ArcelorMittal Eisenhüttenstadt GmbH
|
Germany
|
|
||
|
ArcelorMittal Bremen GmbH
|
Germany
|
|
||
|
ArcelorMittal Méditerranée S.A.S.
|
France
|
|
||
|
ArcelorMittal Belval & Differdange S.A.
|
Luxembourg
|
|
||
|
ArcelorMittal Hamburg GmbH
|
Germany
|
|
||
|
ArcelorMittal Duisburg GmbH
|
Germany
|
|
||
|
Sustainable Solutions
|
||||
|
ArcelorMittal International Luxembourg S.A.
|
Luxembourg
|
|
||
|
AM Green Energy Private Limited
1
|
India
|
|
||
|
Mining
|
||||
|
ArcelorMittal Mining Canada G.P. and ArcelorMittal Infrastructure Canada G.P. ("AMMC")
|
Canada
|
|
||
|
ArcelorMittal Liberia Ltd
2
("AML")
|
Liberia
|
|
||
|
Others
|
||||
|
ArcelorMittal South Africa Ltd.
3
("AMSA")
|
South Africa
|
|
||
|
PJSC ArcelorMittal Kryvyi Rih ("AMKR")
|
Ukraine
|
|
1.
Rights to variable returns are
100
%
.
2.
ArcelorMittal Liberia Ltd is incorporated in Cyprus.
3.
Voting rights are
53.05
%
.
currency
The functional currency of ArcelorMittal S.A. is the U.S. dollar.
The functional currency of each of the principal operating
subsidiaries is the local currency, except for ArcelorMittal
México,
AMMC
, AML, ArcelorMittal International Luxembourg,
whose functional currency is the U.S. dollar and ArcelorMittal
Poland, whose functional currency is the euro.
Transactions in currencies other than the functional currency of
a subsidiary are recorded at the rates of exchange prevailing at
the date of the transaction. Monetary assets and liabilities in
currencies other than the functional currency are remeasured at
the rates of exchange prevailing on the date of the consolidated
statements of financial position and the related translation gains
and losses are reported within financing costs in the
consolidated statements of operations. Non-monetary items that
are carried at cost are translated using the rate of exchange
prevailing at the date of the transaction. Non-monetary items
that are carried at fair value are translated using the exchange
212
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
rate prevailing when the fair value was determined and the
related translation gains and losses are reported in the
consolidated statements of comprehensive income.
Upon consolidation, the results of operations of ArcelorMittal’s
subsidiaries, associates and joint arrangements whose
functional currency is other than the U.S. dollar are translated
into U.S. dollar at the monthly average exchange rates and
assets and liabilities are translated at the year-end exchange
rates. Translation adjustments are recognized directly in other
comprehensive income and are included in net income
(including non-controlling interests) only upon sale or liquidation
of the underlying foreign subsidiary, associate or joint
Since July 1, 2018, Argentina has been considered a highly
inflationary country and therefore the financial statements of the
Company's long production facilities Acindar Industria Argentina
de Aceros S.A. ("Acindar") in Argentina, using a historical cost
approach, are adjusted prospectively to reflect the changes in
the general purchasing power of the local currency before being
translated into U.S. dollar at the year-end exchange rate. The
Company used an estimated general price index (Consumer
Price Index "IPC") which changed by
117.8
%
,
211.4
%
and
respectively, for this purpose. As a result of the inflation-related
adjustments on non-monetary items, losses of
291
,
105
and
4
were recognized in net financing costs for the year ended
December 31, 2024, 2023 and 2022, respectively.
Business combinations are accounted for using the acquisition
method as of the acquisition date, which is the date on which
control is transferred to ArcelorMittal. The Company controls an
entity when it is exposed to or has rights to variable returns from
its involvement with the entity and has the ability to affect those
returns through its power over the entity.
The Company measures goodwill at the acquisition date as the
total of the fair value of consideration transferred, plus the
proportionate amount of any non-controlling interest, plus the
fair value of any previously held equity interest in the acquiree, if
any, less the net recognized amount (generally at fair value) of
the identifiable assets acquired and liabilities assumed.
In a business combination in which the fair value of the
identifiable net assets acquired exceeds the cost of the acquired
business, the Company reassesses the fair value of the assets
acquired and liabilities assumed. If, after reassessment,
ArcelorMittal’s interest in the net fair value of the acquiree’s
identifiable assets, liabilities and contingent liabilities exceeds
the cost of the business combination, the excess (bargain
purchase) is recognized immediately as a reduction of cost of
sales in the consolidated statements of operations.
Any contingent consideration payable is recognized at fair value
at the acquisition date and any costs directly attributable to the
On May 31, 2024, ArcelorMittal completed the acquisition of
Italpannelli SRL in Italy and Italpannelli Iberica in Spain
("Italpannelli"). Italpannelli is a manufacturer of lightweight
insulation panels for roofs and façades. It operates
two
production plants across Europe, in Zaragoza (Spain) and
Abruzzo (Italy). The acquisition adds considerable strategic
value to ArcelorMittal Construction’s business within the
Sustainable Solutions reportable segment in terms of growth,
enhanced geographic market offering, product capabilities and
synergies as a result of which, following the completion of
measurement of the acquisition-date fair value of the identifiable
assets and liabilities, the Company recognized
85
goodwill
.
Goodwill is not deductible for income tax purposes.
The total
cash consideration paid was €
268
million (
201
net of cash
acquired of
88
).
Revenue and net income since acquisition date
were
83
and
7
,
respectively
.
Revenue and net income attributable to the equity holders of the
parent of the Company for twelve months ended December 31,
2024 were
62,576
and
1,354
, respectively, as though
ArcelorMittal had completed the Italpannelli acquisition as of
January 1, 2024.
On June 20, 2024, the Company acquired from Euler Hermes
Reinsurance AG the reinsurance company Euler Hermes Re for
€
134
million (
144
). Net cash inflow was
17
considering
161
cash
acquired. The Company concluded that the acquisition of Euler
Hermes RE was not a business combination as the transaction
did not include the acquisition of any strategic, operational and
resource management processes.
In January 2023,
ArcelorMittal Brasil settled the undisputed
amount it accepts as the value of the Votorantim put option for
213
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
On March 9, 2023, following receipt of customary regulatory
approvals, ArcelorMittal completed the acquisition of Companhia
Siderúrgica do Pecém subsequently renamed ArcelorMittal
Pecém for total cash consideration of
2,193
.
The Company
recognized acquisition-related costs of
4
in selling, general and
administrative expenses.
ArcelorMittal Pecém is a world-class
operation, producing high-quality slab at a globally competitive
cost. ArcelorMittal Pecém’s state-of-the-art steel facility in the
state of Ceará in northeast Brazil was commissioned in 2016
and produced its first slabs in June of that year. It operates a
conveyors to the Port of Pecém, a large scale, deep water port
located
10
kilometers from the plant. ArcelorMittal Pecém
operates within Brazil’s first Export Processing Zone, and
benefits from various tax incentives including a low corporate
income tax rate.
The Company completed its measurement of
the acquisition-date fair value of the identifiable assets and
liabilities of
ArcelorMittal
Pecém. Acquired current assets and
other liabilities include
2,605
and
2,605
of restricted cash held in
escrow and debt, respectively, which were settled after
acquisition date. The Company presented these settlements as
non-cash transactions in the consolidated statements of cash
flows. It recognized also
3,123
(including trade receivables of
equipment and intangible assets, respectively. ArcelorMittal
recognized
164
goodwill resulting from operational and financial
synergies. Revenue and net income since acquisition date till
December 31, 2023 were
1,497
and
340
, respectively.
ArcelorMittal Pecém
is part of the Brazil reportable segment.
During the first half of 2023, the Company also completed
two
acquisitions relating to the
Sustainable Solutions reportable
segment ("Sustainable Solutions acquisitions").
On January 3,
2023, ArcelorMittal completed the acquisition of Riwald
Recycling, a state-of-the-art ferrous scrap metal recycling
business based in the Netherlands. The acquisition is part of
ArcelorMittal's strategy
of increasing the use of scrap steel to
lower CO
2
emissions from steelmaking in both the EAF and BF-
BOF routes.
On March 10, 2023, the Company also completed
the acquisition of the German insulation panel manufacturer
Italpannelli Germany (subsequently renamed Trier Insulated
Panels), which will complement the existing geographic
presence and strengthen the product portfolio of
ArcelorMittal
Sustainable Solutions' construction business.
The total cash
consideration paid for the
Sustainable Solutions
acquisitions
was €
144
million (
152
net of cash acquired of
4
) including debt
assumed of
15
. The Company completed the measurement of
the acquisition-date fair value of the identifiable assets and
liabilities of the Sustainable Solutions acquisitions and
recognized goodwill of
57
, which is primarily attributable to the
expected synergies and other benefits from combining the
activities of the Sustainable Solutions acquisitions with those of
the Company. Goodwill is not deductible for income tax
purposes. Revenue and net loss since acquisition date till
December 31, 2023 were
87
and
4
, respectively.
Revenue and net income attributable to the equity holders of the
parent of the Company for the twelve months ended December
31, 2023 were
68,579
and
910
,
respectively, as though
ArcelorMittal had completed the ArcelorMittal Pecém and
Sustainable Solutions acquisitions as of January 1, 2023.
During 2022, among others, the Company completed the
acquisition of
three
specialist scrap metal recyclers as the
Company continually seeks to enhance its ability to source
scrap steel, a key raw material which supports the
ArcelorMittal’s ability to reduce its carbon emissions from
steelmaking in both the EAF and BF-BOF routes.
On February 28, 2022, ArcelorMittal acquired John Lawrie
Metals Limited ("JLM"), a UK based leading consolidator of
ferrous scrap metal, for total consideration of
£
35
million
(
43
net
of cash acquired of
5
). The Company completed its
measurement of the acquisition-date fair value of the identifiable
asset and liabilities of JLM. Revenue and net income since
acquisition date till December 31, 2022 were
49
and
3
,
respectively. JLM is part of the Sustainable Solutions reportable
segment.
On May 2, 2022, ArcelorMittal completed the acquisition of
Architectural Steel Limited ("ASL"), a UK based manufacturer of
bespoke metal fabrications and flashings for building envelopes
to strengthen the construction business
within
the Sustainable
Solutions reportable segment. Total consideration was
£
36
million
(
39
net of cash acquired of
6
). The Company
completed its measurement of the acquisition-date fair value of
the identifiable asset and liabilities of ASL. Revenue and net
income since acquisition date till December 31, 2022 were
14
and
3
, respectively.
On May 9, 2022, in order to strengthen the Company's plate
operations in the Sustainable Solutions reportable segment in
selected downstream and distribution activities, ArcelorMittal
increased its interest in the former associate Centro Servizi
Metalli S.p.A. ("CSM"), a stainless plate processing business
with operations mainly in Italy and Poland, from
49.29
%
to
€
13.5
million
(
7
net of cash acquired of
7
). The Company
completed its measurement of the acquisition-date fair value of
the identifiable asset and liabilities of CSM and recognized a
3
bargain purchase gain in cost of sales. Revenue and net income
since acquisition date till December 31, 2022 were
76
and
8
,
respectively.
On June 30, 2022, ArcelorMittal completed the acquisition of an
("HBI") plant located in Corpus Christi, Texas and subsequently
214
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
renamed ArcelorMittal Texas HBI LLC ("ArcelorMittal Texas
HBI") for total consideration of
817
(
805
net of cash acquired of
recognized acquisition-related costs of
7
in selling, general and
administrative expenses. The facility has an annual capacity of
the direct reduction of iron ore which is used to produce high-
quality steel grades in an EAF, but which can also be used in
blast furnaces, resulting in lower coke consumption. HBI is a
premium, compacted form of DRI developed to overcome issues
associated with shipping and handling DRI. voestalpine has
retained a
20
%
interest in the plant with a corresponding offtake
agreement with an initial
ten
-year
term renewable as long as
voestalpine retains any interest in ArcelorMittal Texas HBI.
ArcelorMittal would own
100
%
of any future development of
operations. The remaining balance of production will be
delivered to third parties under existing supply contracts, and to
ArcelorMittal facilities, including to AM/NS Calvert in Alabama,
upon the commissioning of its
1.5
million
tonne EAF. Pursuant to
the purchase agreement, voestalpine's
20
%
interest is subject
to a call option exercisable by ArcelorMittal upon termination of
the offtake agreement or failure by voestalpine to purchase the
offtake volume and a put option exercisable by voestalpine at
the end of the fifth, tenth and fifteenth year subsequently to the
acquisition date. The Company did not ascribe any value to the
call option but recognized a
177
financial liability at amortized
cost measured at the present value of the redemption amount of
the written put option based on the lower of equity value
increased by an annual contractual return and fair value. The
Company completed its measurement of the acquisition-date
fair value of the identifiable assets and liabilities of ArcelorMittal
Texas HBI.
It recognized
283
(including trade receivables of
equipment and intangible assets, respectively. ArcelorMittal
recognized
a
97
bargain purchase gain in cost of sales as a
result of i) ArcelorMittal's agreement
for voestalpine to retain a
agreement and iii) the fair value of
property, plant and
equipment exceeding its carrying amount. Revenue and net
loss since acquisition date till December 31, 2022 were
445
and
reportable segment.
On July 1, 2022, the Company completed the combined
acquisition of
three
subsidiaries from environmental services
and recycling company ALBA International Recycling (ALBA
Metall Süd Rhein-Main GmbH, ALBA Electronics Recycling
GmbH and ALBA Metall Süd Franken GmbH in aggregate
"ALBA") active in ferrous and non-ferrous metal recycling in
Germany for total consideration of
65
of which €
51
million (
45
net of cash acquired of
9
) in cash and deferred consideration of
the identifiable assets and liabilities of the
three
companies, the
Company recognized goodwill of
22
. Revenue and net income
since acquisition date till December 31, 2022 were
87
and
1
,
respectively. ALBA is part of the Sustainable Solutions
reportable
segment
.
On February 28, 2025, ArcelorMittal signed a share purchase
and shareholders' agreement with the management of the joint
venture ArcelorMittal Tailored Blanks Americas following which
the Company shall increase its ownership from
80
%
to
90
%
and
acquire control. In addition, on February 28, 2025, the Company
also signed a share purchase agreement to acquire a
60
%
controlling stake in Tuper, a joint venture in which it already held
a
40
%
interest. Transaction closing is subject to certain
corporate and regulatory approvals including CADE (Brazilian
anti-trust) approval. Both acquisitions are expected to close
during the first half of 2025.
215
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
2024
|
2023
|
2022
|
||||||
|
Italpannelli
|
ArcelorMittal
Pecém
|
Sustainable
Solutions
acquisitions
|
JLM
|
ASL
|
CSM
|
ArcelorMittal
Texas HBI
|
ALBA
|
|
|
Current assets
|
|
|
|
|
|
|
|
|
|
Property, plant and equipment
|
|
|
|
|
|
|
|
|
|
Intangible assets
|
|
|
|
|
|
|
|
|
|
Other non-current assets
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
|
|
|
|
|
|
|
|
Deferred tax liabilities
|
(
|
|
(
|
(
|
(
|
|
(
|
(
|
|
Other liabilities
|
(
|
(
|
(
|
(
|
(
|
(
|
(
|
(
|
|
Total liabilities
|
(
|
(
|
(
|
(
|
(
|
(
|
(
|
(
|
|
Net assets acquired
|
|
|
|
|
|
|
|
|
|
Consideration paid net of cash acquired
|
|
|
|
|
|
|
|
|
|
Deferred consideration
|
|
|
|
|
|
|
|
|
|
Non-controlling interests
|
|
|
|
|
|
|
|
|
|
Debt assumed
|
|
|
(
|
|
|
|
|
|
|
Fair value of previously held interests at
acquisition date
|
|
|
|
|
|
|
|
|
|
Goodwill/(bargain purchase gain)
|
|
|
|
|
|
(
|
(
|
|
held for sale are measured at the lower of carrying amount and
fair value less costs to sell. Assets and disposal groups are
classified as held for sale if their carrying amount will be
recovered through a sale transaction rather than through
continuing use. The non-current asset, or disposal group, is
classified as held for sale only when the sale is highly probable
and is available for immediate sale in its present condition and is
marketed for sale at a price that is reasonable in relation to its
current fair value. Assets held for sale are presented separately
in the consolidated statements of financial position and are not
depreciated. Gains (losses) on disposal of subsidiaries are
recognized in cost of sales, whereas gains (losses) on disposal
of investments accounted for under the equity method are
recognized in income (loss) from investments in associates, joint
ventures and other investments.
An operation is classified as discontinued when it represents a
separate major line of business or geographical area of
operations that either has been disposed of or is classified as
held for sale.
Discontinued operations are reported on a single
line in the Company's consolidated statements of operations. It
reflects the after-tax net income from discontinued operations
until the date of disposal and the gains or losses net of taxes
realized on the disposals of these operations. In addition, cash
flows generated by the discontinued operations are reported on
a separate line in the consolidated statement of cash flows for
the relevant periods.
On December 7, 2023, ArcelorMittal completed the sale of
ArcelorMittal Temirtau, its steel and mining operations in
Kazakhstan, to Qazaqstan Investment Corporation ("QIC"), a
state-controlled direct investment fund. Under the terms of the
transaction, on closing ArcelorMittal received consideration of
net assets and a further
250
as repayment of outstanding intra-
group receivables. ArcelorMittal will also receive an additional
sovereign-fund guaranteed payment of
450
, paid in
four
equal
annual installments, as repayment of an intra-group loan. All
ArcelorMittal Temirtau assets were transferred on an ‘as is’
operational basis, meaning QIC assumed control and
accountability for ArcelorMittal Temirtau’s operations. As a result
of loss of control, the Company derecognized assets and
liabilities of
1,650
and
1,372
, respectively. ArcelorMittal
recognized in cost of sales a
732
impairment loss of property,
plant and equipment upon measuring the recoverable amount
based on sales proceeds (see note 5.3). The Company also
recognized in cost of sales a
194
impairment loss of goodwill
following the allocation to the disposal group of a portion of the
former ACIS segment goodwill in proportion of the consideration
received to the total recoverable amount of the former ACIS
operations (see notes 3.1, 5.1 and 5.3). In addition, it
reclassified
1,469
of foreign exchange translation losses from
216
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
other comprehensive income to cost of sales in the consolidated
statements of operations.
completed in 2023 (there were no divestments in 2024 and
2022):
|
2023
|
||
|
ArcelorMittal
Temirtau
|
||
|
Cash and cash equivalents
|
|
|
|
Other current assets
|
|
|
|
Intangible assets
|
|
|
|
Property, plant and equipment
|
|
|
|
Other assets
|
|
|
|
Total assets
|
|
|
|
Current liabilities
|
|
|
|
Other long-term liabilities
|
|
|
|
Total liabilities
|
|
|
|
Total net assets
|
|
|
|
% of net assets sold
|
|
|
|
Total net assets disposed of
|
|
|
|
ArcelorMittal retained interest
|
|
|
|
Goodwill allocation
|
(
|
|
|
Consideration
|
|
|
|
Reclassification of foreign exchange and other
|
(
|
|
|
Gain (loss) on disposal/derecognition
|
(
|
for under the equity method were as follows:
|
December 31,
|
|||
|
Category
|
2024
|
2023
|
|
|
Joint ventures
|
|
|
|
|
Associates
|
|
|
|
|
Individually immaterial joint ventures and
associates
1
|
|
|
|
|
Total
|
|
|
|
1.
Individually immaterial joint ventures and associates represent in aggregate
less than
20
%
of the total carrying amount of investments in joint ventures and
associates at
December 31, 2024
and 2023, and none of them have a
217
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
material joint ventures, as well as the income statement of the Company’s material joint ventures:
|
December 31, 2024
|
||||||||||||||||||
|
Joint Ventures
|
AMNS India
|
Calvert
|
NEMM
|
VAMA
|
Tameh
|
Borçelik
|
Al Jubail
|
VdSA
|
Total
|
|||||||||
|
Financial statements
reporting date
|
December
31, 2024
|
December
31, 2024
|
December
31, 2024
|
December
31, 2024
|
December
31, 2024
|
December 31,
2024
|
December
31, 2024
|
December
31, 2024
|
||||||||||
|
Place of incorporation
and operation
1
|
India
|
United
States
|
China
|
China
|
Poland
|
Turkey
|
Saudi
Arabia
|
Brazil
|
||||||||||
|
Principal Activity
|
Integrated
flat steel
producer
4,5
|
Automotive
steel
finishing
6
|
Production
and sale of
electrical
steel
7
|
Automotive
steel
finishing
|
Energy
production
and supply
|
Manufacturing
and sale of
steel
2,3
|
Production
and sale of
seamless
line pipes
and tubes
|
Renewable
energy
production
and supply
|
||||||||||
|
Ownership and voting
rights at December 31,
2024
|
|
|
|
|
|
|
|
|
||||||||||
|
Current assets
|
|
|
|
|
|
|
|
|
|
|||||||||
|
of which cash, cash
equivalents and
restricted cash
|
|
|
|
|
|
|
|
|
|
|||||||||
|
Non-current assets
|
|
|
|
|
|
|
|
|
|
|||||||||
|
Current liabilities
|
|
|
|
|
|
|
|
|
|
|||||||||
|
of which trade and other
payables and provisions
|
|
|
|
|
|
|
|
|
|
|||||||||
|
Non-current liabilities
|
|
|
|
|
|
|
|
|
|
|||||||||
|
of which trade and other
payables, provisions and
deferred tax liability
|
|
|
|
|
|
|
|
|
|
|||||||||
|
Non-controlling interest
|
|
|
|
|
|
|
|
|
|
|||||||||
|
Net assets attributable to
equity holders of the
parent
|
|
|
|
|
|
|
|
|
|
|||||||||
|
Company's share of net
assets
|
|
|
|
|
|
|
|
|
|
|||||||||
|
Adjustments for
differences in accounting
policies and other
|
|
(
|
|
|
|
(
|
|
|
|
|||||||||
|
Carrying amount in the
statements of financial
position
|
|
|
|
|
|
|
|
|
|
|||||||||
|
Revenue
|
|
|
|
|
|
|
|
|
|
|||||||||
|
Depreciation and
amortization
|
(
|
(
|
|
(
|
(
|
(
|
(
|
|
(
|
|||||||||
|
Interest income
|
|
|
|
|
|
|
|
|
|
|||||||||
|
Interest expense
|
(
|
(
|
|
(
|
(
|
(
|
(
|
|
(
|
|||||||||
|
Income tax benefit
(expense)
|
|
|
|
(
|
(
|
(
|
(
|
|
|
|||||||||
|
Income (loss) from
continuing operations
|
|
|
|
|
(
|
|
|
(
|
|
|||||||||
|
Other comprehensive
income (loss)
|
(
|
(
|
|
|
(
|
|
|
|
(
|
|||||||||
|
Total comprehensive
income (loss)
|
(
|
|
|
|
(
|
|
|
(
|
|
|||||||||
|
Cash dividends received
by the Company
|
|
|
|
|
|
|
|
|
|
|||||||||
1.
The country of incorporation corresponds to the country of operation.
218
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
2.
Ownership interest in
Borçelik was
45.33
%
and
50.00
%
based on issued shares and outstanding shares, respectively, at December 31, 2024; voting interest was
48.01
%
at
December 31, 2024
.
3.
Adjustment in Borçelik relates primarily to differences in accounting policies regarding revaluation of fixed assets.
4.
Adjustments in AMNS India correspond primarily to transaction costs incurred to set up the joint venture and the fair value of the guarantee of the joint venture's debt (see
note 9.4).
5.
Includes AMNS Luxembourg, AMNS India (including infrastructure assets) and intermediate holding entities.
6.
Adjustments in Calvert primarily relate to differences in accounting policies regarding inventory valuation.
7.
The joint venture was incorporated and had no operations in 2024. The initial carrying amount of
566
corresponds to a paid cash contribution of
120
and
446
liability
(including a non-current portion of
222
see note 9.2) corresponding to the net present value of future equity increases for which the Company has a present obligation.
|
December 31, 2023
|
||||||||||||||||
|
Joint Ventures
|
AMNS India
|
Calvert
|
VAMA
|
Tameh
|
Borçelik
|
Al Jubail
|
VdSA
|
Total
|
||||||||
|
Place of incorporation and operation
1
|
India
|
United
States
|
China
|
Poland
|
Turkey
|
Saudi
Arabia
|
Brazil
|
|||||||||
|
Principal Activity
|
Integrated
flat steel
producer
4,5
|
Automotive
steel
finishing
6
|
Automotive
steel
finishing
|
Energy
production
and supply
|
Manufacturing
and sale of
steel
2,3
|
Production
and sale
of
seamless
line pipes
and tubes
|
Renewable
energy
production
and supply
|
|||||||||
|
Ownership and voting rights at
December 31, 2023
|
|
|
|
|
|
|
|
|||||||||
|
Current assets
|
|
|
|
|
|
|
|
|
||||||||
|
of which cash, cash equivalents and
restricted cash
|
|
|
|
|
|
|
|
|
||||||||
|
Non-current assets
|
|
|
|
|
|
|
|
|
||||||||
|
Current liabilities
|
|
|
|
|
|
|
|
|
||||||||
|
of which trade and other payables
and provisions
|
|
|
|
|
|
|
|
|
||||||||
|
Non-current liabilities
|
|
|
|
|
|
|
|
|
||||||||
|
of which trade and other payables
and provisions
|
|
|
|
|
|
|
|
|
||||||||
|
Non-controlling interest
|
|
|
|
|
|
|
|
|
||||||||
|
Net assets attributable to equity
holders of the parent
|
|
|
|
|
|
|
|
|
||||||||
|
Company's share of net assets
|
|
|
|
|
|
|
|
|
||||||||
|
Adjustments for differences in
accounting policies and other
|
|
(
|
|
(
|
(
|
|
|
|
||||||||
|
Carrying amount in the statements of
financial position
|
|
|
|
|
|
|
|
|
||||||||
|
Revenue
|
|
|
|
|
|
|
|
|
||||||||
|
Depreciation and amortization
|
(
|
(
|
(
|
(
|
(
|
(
|
|
(
|
||||||||
|
Interest income
|
|
|
|
|
|
|
|
|
||||||||
|
Interest expense
|
(
|
(
|
(
|
(
|
(
|
(
|
|
(
|
||||||||
|
Income tax benefit (expense)
|
(
|
|
(
|
(
|
(
|
|
|
(
|
||||||||
|
Income (loss) from continuing
operations
|
|
|
|
|
|
|
|
|
||||||||
|
Other comprehensive income (loss)
|
(
|
(
|
|
(
|
(
|
|
|
(
|
||||||||
|
Total comprehensive income (loss)
|
|
|
|
(
|
|
|
|
|
||||||||
|
Cash dividends received by the
Company
|
|
|
|
|
|
|
|
|
||||||||
1.
The country of incorporation corresponds to the country of operation except for Tameh whose country of operation is also the Czech Republic.
2.
Ownership interest in
Borçelik was
45.33
%
and
50.00
%
based on issued shares and outstanding shares, respectively, at December 31, 2023; voting interest was
48.01
%
at December 31, 2023.
3.
Adjustment in Borçelik relates primarily to differences in accounting policies regarding revaluation of fixed assets.
4.
Adjustments in AMNS India correspond primarily to transaction costs incurred to set up the joint venture and the fair value of the guarantee of the joint venture's debt (see
note 9.4).
219
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
5.
Includes AMNS Luxembourg, AMNS India and intermediate holding entities.
6.
Adjustments in Calvert primarily relate to differences in accounting policies regarding inventory valuation.
|
December 31, 2022
|
||||||||||||||||
|
Joint Ventures
|
AMNS India
|
Acciaierie
d'Italia
|
Calvert
|
VAMA
|
Tameh
|
Borçelik
|
Al Jubail
|
Total
|
||||||||
|
Place of incorporation and operation
1
|
India
|
Italy
|
United
States
|
China
|
Poland
|
Turkey
|
Saudi
Arabia
|
|||||||||
|
Principal Activity
|
Integrated
flat steel
producer
4,5
|
Integrated
flat steel
producer
6
|
Automotive
steel
finishing
7
|
Automotive
steel
finishing
|
Energy
production
and supply
|
Manufacturin
g and sale of
steel
2,3
|
Production
and sale of
seamless
line pipes
and tubes
|
|||||||||
|
Ownership and voting rights at
December 31, 2022
|
|
|
|
|
|
|
|
|||||||||
|
Current assets
|
|
|
|
|
|
|
|
|
||||||||
|
of which cash, cash equivalents and
restricted cash
|
|
|
|
|
|
|
|
|
||||||||
|
Non-current assets
|
|
|
|
|
|
|
|
|
||||||||
|
Current liabilities
|
|
|
|
|
|
|
|
|
||||||||
|
of which trade and other payables
and provisions
|
|
|
|
|
|
|
|
|
||||||||
|
Non-current liabilities
|
|
|
|
|
|
|
|
|
||||||||
|
of which trade and other payables
and provisions
|
|
|
|
|
|
|
|
|
||||||||
|
Non-controlling interest
|
|
|
|
|
|
|
|
|
||||||||
|
Net assets attributable to equity
holders of the parent
|
|
|
|
|
|
|
|
|
||||||||
|
Company's share of net assets
|
|
|
|
|
|
|
|
|
||||||||
|
Adjustments for differences in
accounting policies and other
|
|
|
(
|
|
|
(
|
(
|
|
||||||||
|
Carrying amount in the statements of
financial position
|
|
|
|
|
|
|
|
|
||||||||
|
Revenue
|
|
|
|
|
|
|
|
|
||||||||
|
Depreciation and amortization
|
(
|
(
|
(
|
(
|
(
|
(
|
(
|
(
|
||||||||
|
Interest income
|
|
|
|
|
|
|
|
|
||||||||
|
Interest expense
|
(
|
(
|
(
|
(
|
(
|
(
|
(
|
(
|
||||||||
|
Income tax benefit (expense)
|
(
|
|
|
(
|
(
|
(
|
(
|
(
|
||||||||
|
Income (loss) from continuing
operations
|
|
|
|
|
|
|
|
|
||||||||
|
Other comprehensive income (loss)
|
(
|
|
|
|
|
|
(
|
(
|
||||||||
|
Total comprehensive income (loss)
|
|
|
|
|
|
|
|
|
||||||||
|
Cash dividends received by the
Company
|
|
|
|
|
|
|
|
|
||||||||
1.
The country of incorporation corresponds to the country of operation except for Tameh whose country of operation is also the Czech Republic.
2.
Ownership interest in Borçelik was
45.33
%
and
50.00
%
based on issued shares and outstanding shares, respectively, at December 31, 2022; voting interest was
48.01
%
at December 31, 2022.
3.
Adjustment in Borçelik relates primarily to differences in accounting policies regarding revaluation of fixed assets.
4.
Adjustments in AMNS India correspond primarily to transaction costs incurred to set up the joint venture and the fair value of the guarantee of the joint venture's debt (see
note 9.4).
5.
Includes AMNS Luxembourg, AMNS India and intermediate holding entities.
6.
Includes Acciaierie d'Italia summarized statement of financial position as of December 31, 2022 adjusted for the fair value adjustments at divestment date.
220
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
AMNS India
AMNS India is an integrated flat carbon steel manufacturer -
from iron ore to ready-to-market products with an achievable
crude steel capacity of
8.8
million
tonnes per annum. Its
manufacturing facilities comprise iron making, steelmaking and
downstream facilities spread across India.
In 2019, ArcelorMittal and Nippon Steel Corporation ("NSC"),
Japan’s largest steel producer and the third largest steel
producer in the world, created a joint venture to own and
operate AMNS India with ArcelorMittal holding a
60
%
interest
and NSC holding
40
%
. Through the agreement, both
ArcelorMittal and NSC are guaranteed equal board
representation and participation in all significant financial and
operating decisions. The Company has therefore determined
that it does not control the entity, even though it holds
60
%
of
the voting rights. AMNS Luxembourg Holding S.A. ("AMNS
Luxembourg") is the parent company of the joint venture.
ArcelorMittal's
60
%
interest is accounted for under the equity
method.
AMNS India’s main steel manufacturing facility is located at
Hazira, Gujarat in western India. It also has:
–
two
iron ore beneficiation plants close to the mines in
Kirandul and Dabuna, with slurry pipelines that then
transport the beneficiated iron ore slurry to the pellet
plants in the Kirandul-Vizag and Dabuna-Paradeep
systems;
–
downstream facilities in Pune, Khopoli and
Gandhidham; and
–
six
service centers in the industrial clusters of Hazira,
Indore, Bahadurgarh, Chennai, Kolkata and Pune. It
has a complete range of flat rolled steel products,
including value added products, and significant iron ore
pellet capacity with
two
main pellet plant systems in
Kirandul-Vizag and Dabuna-Paradeep, which have the
potential for expansion. Its facilities are located close
to ports with deep draft for movement of raw materials
and finished goods.
In terms of iron ore pellet capacity, the Kirandul-Vizag system
has
8
million tonnes of annual pellet capacity; and the Dabuna-
Paradeep system has
12
million tonnes of annual pellet
capacity.
AMNS India completed the acquisition of the portfolio of
strategic infrastructure assets from Essar Group. The remaining
assets which were pending due to regulatory approvals have
been acquired during 2024 and include
a
16
million-tonne per
annum all-weather, deep draft terminal at Visakhapatnam,
Andhra Pradesh (along with an integrated conveyor connected
to AMNS India’s iron ore pellet plant in the port city) and a
100
-
kilometer Gandhar - Hazira transmission line, connecting AMNS
India’s steelmaking complex with the central electricity grid.
AMNS India intends to further debottleneck existing operations
(steel shop and rolling parts) in the medium term. The first
phase of expansion represents capital expenditures of
approximately
7.7
billion (
0.8
billion for debottlenecking,
1.0
billion for downstream projects,
5.7
billion for upstream projects
and
0.2
billion for operational readiness) and started in October
2022
. It aims to increase production at the Hazira facility to
15
million tonnes of rolled products by the second half of 2026
(Phase 1A).
Plans are under development to further expand
production. Phase 2A would see steelmaking capacity grow to
capacity at the Hazira facility to
24
million tonnes by 2030.
Further greenfield development options are under consideration
to take steelmaking capacity to
40
million tonnes per annum in
the long-term.
On March 16, 2020, AMNS Luxembourg entered into a
5.1
billion
ten
-year
term loan agreement with various Japanese
banks which is guaranteed by ArcelorMittal and NSC in
proportion to their interests in the joint venture. On March 30,
2023, AMNS Luxembourg entered into an additional
5
billion
ten
-year term loan agreement at floating rate with various
Japanese banks. The proceeds of the loan, which is guaranteed
by ArcelorMittal and NSC in proportion to their respective
interests in the joint venture, is used for the purposes of
financing the expenditures necessary for the implementation of
phase 1A of expansion to increase production at the Hazira
facility to
15
million tonnes. The loan consists of Tranche A,
Tranche B and Tranche C of
2
billion,
1
billion and
2
billion,
respectively, and
is
arranged to be disbursed by April 30, 2026
at the request of AMNS Luxembourg.
In terms of iron ore mining assets, AMNS India operates the
Thakurani mine in the Keonjhar district of Odisha and the
Ghoraburhani-Sagasahi mine in the Sudargarh district of
Odisha
.
Acciaierie d'Italia
Acciaierie d'Italia
is the leading steel producer in Italy and
produces high-quality and sustainable steel to be used in a
range of vital industry sectors across the domestic steel market
such as construction, energy, automotive, home appliances,
packaging and transport and for international export. Acciaierie
d'Italia has operations across various structurally linked
operating sites including Europe’s biggest single-site integrated
steel facility in Taranto and rolling mills in Genova and Novi
Ligure. Genova is also an important hub in terms of intermodal
logistics.
On April 14, 2021, pursuant to the investment agreement signed
on December 10, 2020 forming a public-private partnership
221
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
betwee
n Invitalia and ArcelorMittal and providing Invitalia joint
control rights, ArcelorMittal accounted for its investment in
Acciaierie d'Italia under the equity method.
On F
ebruary 20, 2024, the Italian Government issued a decree
placing Acciaierie d’Italia in extraordinary administration
subsequent to the request of Invitalia, thereby passing control of
the company from its current shareholders, ArcelorMittal and
Invitalia
, to government appointed commissioners.
As a result of
loss of control, the Company
reclassified
60
of foreign exchange
translation gains from other comprehensive income to i
ncome
from investments in associates, joint ventures and other
investments
in the consolidated statements of operations.
VAMA
Valin ArcelorMittal Automotive Steel (“VAMA”) is a joint venture
between ArcelorMittal and Hunan Valin which produces steel for
high-end applications in the automobile industry. VAMA supplies
international automakers and first-tier suppliers as well as
Chinese car manufacturers and their supplier networks. In April
2023 VAMA announced the start of production for its second
continuous galvanization line with an annual capacity of
450,000
tonnes, bringing its total capacity to
2
millions tonnes per
year
.
Calvert
AM/NS Calvert ("Calvert"), a joint venture between the
Company and NSC, is a steel processing plant in Calvert,
Alabama, United States.
The slabs for Calvert's operations are
sourced from ArcelorMittal plants in Brazil and Mexico and from
Cleveland-C
liffs,
which following its acquisition of ArcelorMittal
USA entered on December 9, 2020 into a new
five
-year
agreement with Calvert (with an automatic
three
-year
extension
unless either party provides notice of intent to terminate) for
1.5
million tonnes annually for the initial term and
0.55
million
tonnes annually under the extension and which can be reduced
with a
six
-month
notice.
In December 2024, Cleveland-Cliffs
formally issued a notice to terminate the agreement at the end
of the initial term on December 9, 2025. ArcelorMittal is
principally responsible for marketing the product on behalf of the
joint venture. Calvert serves the automotive, construction, pipe
and tube, service center and appliance/ HVAC industries.
Calvert completed the investment in an on-site steelmaking
facility through a
1.5
million tonnes capacity EAF (producing
slabs for the existing operations and replacing part of the
purchased slabs). Construction commenced in March 2021 after
obtaining all environmental permits, and commissioning is
underway.
On October 11, 2024, ArcelorMittal entered into an agreement
with NSC pursuant to which ArcelorMittal would purchase NSC’s
into at the request of NSC to address regulatory concerns
pursuant to its agreed acquisition of US Steel. On January 3,
2025, the U.S. President issued an order prohibiting NSC from
acquiring US Steel but the parties were granted an extension to
June 18, 2025 to permanently abandon the transaction.
Accordingly, the agreement with NSC remains in place until
such date.
NEMM
On October 16, 2024, ArcelorMittal and China Oriental formed
principally in the production and sale of electrical steel grade
hot-rolled coil substrates and cold-rolled non-oriented or
oriented electrical steel for the Chinese automotive market. The
project envisages the construction of
two
plants with production
commencing in 2027.
VdSA
On May 5, 2023, following approval by the Brazilian antitrust
authority CADE on April 13, 2023, ArcelorMittal formed the joint
venture Ventos de Santo Antônio Comercializadora de Energia
S.A. ("VdSA") with Casa dos Ventos, one of Brazil’s largest
developers and producers of renewable energy projects, to
develop a
554
MW wind power project, with ArcelorMittal
holding a
55
%
stake and Casa dos Ventos holding the
remaining
45
%
. The project Ventos de Santo Antonio aims to
secure and decarbonize a considerable proportion of the
Company's wholly-owned subsidiary ArcelorMittal Brazil’s future
electricity needs through a
20
-year
power purchasing power
agreement starting on January 1, 2026. Through the agreement,
both ArcelorMittal and Casa dos Ventos are guaranteed equal
board representation and participation in all significant financial
and operating decisions. The Company has therefore
determined that VdSA is a joint venture subject to joint control
as it does not control the entity, even though it holds a
55
%
interest. The Company accounted for its investment in VdSA
under the equity method.
Tameh
Tameh is a joint venture between ArcelorMittal and Tauron
Polska Energia S. A. ("Tauron") including
three
energy
production facilities located in Poland. Tameh’s objective is to
ensure energy supply to the Company’s steel plants in Poland
as well as the utilization of steel plant gases for energy
production processes.
Following the occurrence of a deadlock situation, both Tauron
and ArcelorMittal had the ability to exercise a put option right,
allowing each partner to sell its shares to the other one. As per
the shareholders' agreement, the declaration of acceptance of
an offer that is submitted first shall prevail. ArcelorMittal
successfully served its declaration on Tauron on January 2,
2024. Tauron challenged this assertion and in October 2024,
ArcelorMittal was served with a request for
arbitration
filed by
Tauron (see note 9.3).
222
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
Borçelik
Borçelik Çelik Sanayii Ticaret Anonim Şirketi ("Borçelik"),
incorporated and located in Turkey, is a joint venture between
ArcelorMittal and Borusan Holding involved in the manufacturing
and sale of cold-rolled and galvanized flat steel products.
Al Jubail
ArcelorMittal Tubular Products Al Jubail ("Al Jubail") is a state of
the art seamless tube mill in Saudi Arabia designed and built to
serve the fast growing energy producing markets of Saudi
Arabia, the Middle East, North Africa and beyond.
Al Jubail is a joint venture in which the Company owns a
associates, as well as the income statement of the Company’s material associates:
|
December 31, 2024
|
||||||||||||
|
Associates
|
Vallourec
|
China Oriental
|
DHS Group
|
Gonvarri Steel
Industries
|
Baffinland
6
|
Total
|
||||||
|
Financial statements reporting date
|
September 30,
2024
|
June 30, 2024
|
September 30,
2024
|
September 30,
2024
|
December 31,
2024
|
|||||||
|
Place of incorporation and operation
1
|
France
|
Bermuda
|
Germany
|
Spain
|
Canada
|
|||||||
|
Principal Activity
|
Tubular
solutions
2
|
Iron and steel
manufacturing
|
Steel
manufacturing
3
|
Steel
manufacturing
4
|
Extraction of
iron ore
5
|
|||||||
|
Ownership and voting rights at
December 31, 2024
|
|
|
|
|
|
|||||||
|
Current assets
|
|
|
|
|
|
|
||||||
|
Non-current assets
|
|
|
|
|
|
|
||||||
|
Current liabilities
|
|
|
|
|
|
|
||||||
|
Non-current liabilities
|
|
|
|
|
|
|
||||||
|
Non-controlling interests
|
|
|
|
|
|
|
||||||
|
Net assets attributable to equity holders
of the parent
|
|
|
|
|
|
|
||||||
|
Company's share of net assets
|
|
|
|
|
|
|
||||||
|
Adjustments for differences in
accounting policies and other
|
|
|
|
(
|
(
|
(
|
||||||
|
Other adjustments
|
|
|
(
|
|
|
|
||||||
|
Carrying amount in the statements of
financial position
|
|
|
|
|
|
|
||||||
|
Revenue
|
|
|
|
|
|
|
||||||
|
Income / (loss) from continuing
operations
|
|
|
|
|
(
|
|
||||||
|
Other comprehensive income
|
(
|
|
(
|
(
|
|
(
|
||||||
|
Total comprehensive income (loss)
|
|
|
|
|
(
|
|
||||||
|
Cash dividends received by the
Company
|
|
|
|
|
|
|
||||||
1.
The country of incorporation corresponds to the country of operation except for China Oriental, whose country of operation is China, and Vallourec, whose operations are
global.
2.
Adjustments in Vallourec relate to provisional fair value adjustments of property, plant and equipment and goodwill.
3.
The amount for DHS Group includes an adjustment to align the German GAAP financial information with the Company’s accounting policies and is mainly linked to
property, plant and equipment, inventory and pension. Other adjustment include the Company's impairment loss with respect to its investment in DHS Group.
4.
Adjustments in Gonvarri Steel Industries primarily relate to differences in accounting policies regarding revaluation of fixed assets.
5.
Adjustments in Baffinland primarily relate to differences in accounting policies regardin
g recognized goodwill. In September 2020, following a legal reorganization that was
not a business combination for the Company, its share of fair value remeasurement of
1.5
billio
n was not recognized in the carrying amount of Baffinland.
6.
Following a legal reorganization in September 2020, the Company holds an indirect interest in Baffinland through Nunavut Iron Ore Inc.
223
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
December 31, 2023
|
||||||||||
|
Associates
|
China Oriental
|
DHS Group
|
Gonvarri Steel
Industries
|
Baffinland
6
|
Total
|
|||||
|
Financial statements reporting date
|
June 30, 2023
|
September 30,
2023
|
September 30,
2023
|
December 31,
2023
|
||||||
|
Place of incorporation and operation
1
|
Bermuda
|
Germany
|
Spain
|
Canada
|
||||||
|
Principal Activity
|
Iron and steel
manufacturing
|
Steel
manufacturing
3
|
Steel
manufacturing
4
|
Extraction of
iron ore
5
|
||||||
|
Ownership and voting rights at December 31, 2023
|
|
|
|
|
||||||
|
Current assets
|
|
|
|
|
|
|||||
|
Non-current assets
|
|
|
|
|
|
|||||
|
Current liabilities
|
|
|
|
|
|
|||||
|
Non-current liabilities
|
|
|
|
|
|
|||||
|
Non-controlling interests
|
|
|
|
|
|
|||||
|
Net assets attributable to equity holders of the parent
|
|
|
|
|
|
|||||
|
Company's share of net assets
|
|
|
|
|
|
|||||
|
Adjustments for differences in accounting policies and
other
|
|
|
(
|
(
|
(
|
|||||
|
Other adjustments
2
|
|
(
|
|
|
(
|
|||||
|
Carrying amount in the statements of financial position
|
|
|
|
|
|
|||||
|
Revenue
|
|
|
|
|
|
|||||
|
Income / (loss) from continuing operations
|
|
|
|
(
|
|
|||||
|
Other comprehensive income
|
|
(
|
(
|
|
(
|
|||||
|
Total comprehensive income (loss)
|
|
|
|
(
|
|
|||||
|
Cash dividends received by the Company
|
|
|
|
|
|
|||||
1.
The country of incorporation corresponds to the country of operation except for China Oriental whose country of operation is China.
2.
Other adjustments correspond to the difference between the carrying amount at December 31, 2023 and the net assets situation corresponding to the latest financial
statements ArcelorMittal is permitted to disclose translated with closing rates as of the reporting dates described in the table above.
3.
The amount for DHS Group includes an adjustment to align the German GAAP financial information with the Company’s accounting policies and is mainly linked to
property, plant and equipment, inventory and pension.
4.
Adjustments in Gonvarri Steel Industries primarily relate to differences in accounting policies regarding revaluation of fixed assets.
5.
Adjustments in Baffinland primarily relate to differences in accounting policies regarding recognized goodwill. In September 2020, following a legal reorganization that was
not a business combination for the Company, its share of fair value remeasurement of
1.5
billion was not recognized in the carrying amount of Baffinland.
6.
Following a legal reorganization in September 2020, the Company holds an indirect interest in Baffinland through Nunavut Iron Ore Inc.
224
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
December 31, 2022
|
||||||||||
|
Associates
|
China Oriental
|
DHS Group
|
Gonvarri Steel
Industries
|
Baffinland
6
|
Total
|
|||||
|
Financial statements reporting date
|
June 30, 2022
|
September 30,
2022
|
September 30,
2022
|
December 31,
2022
|
||||||
|
Place of incorporation and operation
1
|
Bermuda
|
Germany
|
Spain
|
Canada
|
||||||
|
Principal Activity
|
Iron and steel
manufacturing
|
Steel
manufacturing
3
|
Steel
manufacturing
4
|
Extraction of
iron ore
5
|
||||||
|
Ownership and voting rights at December 31, 2022
|
|
|
|
|
||||||
|
Current assets
|
|
|
|
|
|
|||||
|
Non-current assets
|
|
|
|
|
|
|||||
|
Current liabilities
|
|
|
|
|
|
|||||
|
Non-current liabilities
|
|
|
|
|
|
|||||
|
Non-controlling interests
|
|
|
|
|
|
|||||
|
Net assets attributable to equity holders of the parent
|
|
|
|
|
|
|||||
|
Company's share of net assets
|
|
|
|
|
|
|||||
|
Adjustments for differences in accounting policies and
other
|
|
|
(
|
(
|
(
|
|||||
|
Other adjustments
2
|
(
|
(
|
|
|
(
|
|||||
|
Carrying amount in the statements of financial position
|
|
|
|
|
|
|||||
|
Revenue
|
|
|
|
|
|
|||||
|
Income / (loss) from continuing operations
|
|
|
|
(
|
|
|||||
|
Other comprehensive income (loss)
|
|
|
|
|
|
|||||
|
Total comprehensive income (loss)
|
|
|
|
(
|
|
|||||
|
Cash dividends received by the Company
|
|
|
|
|
|
|||||
1.
The country of incorporation corresponds to the country of operation except for China Oriental whose country of operation is China.
2.
Other adjustments correspond to the difference between the carrying amount at December 31, 2022 and the net assets situation corresponding to the latest financial
statements ArcelorMittal is permitted to disclose as of the reporting dates described in the table above.
3.
The amount for DHS Group includes an adjustment to align the German GAAP financial information with the Company’s accounting policies and is mainly linked to
property, plant and equipment, inventory and pension.
4.
Adjustments in Gonvarri Steel Industries primarily relate to differences in accounting policies regarding revaluation of fixed assets.
5.
Adjustments in Baffinland primarily relate to differences in accounting policies regarding revaluation of fixed assets and locally recognized goodwill. In September 2020,
following a legal reorganization that was not a business combination for the Company, its share of provisional fair value remeasurement of
1.5
billion was not recognized
in the carrying amount of Baffinland.
Vallourec
On August 6, 2024, ArcelorMittal completed the acquisition of
31, 2024) voting rights in
Vallourec
, for €
14.64
per share from
funds managed by Apollo Global Management, Inc. for total
€
960
million (
1,048
) cash consideration. Vallourec's Board of
Directors includes
eleven
members, out of which
two
are
appointed by ArcelorMittal, whose Chief Executive Officer also
acts as an observer of the Board. ArcelorMittal concluded that it
exercises significant influence in Vallourec and accordingly it
accounts for its investment under the equity method. In addition,
as the share purchase agreement includes a forward
component qualifying as a financial instrument as a result of the
purchase price being fixed ahead of the closing date,
ArcelorMitta
l recognized a
83
decrease in acquisition cost to
reflect the fair value of the forward at acquisition date (see note
6.2).
Having carried out a successful restructuring in recent
years, Vallourec presents a compelling opportunity to increase
ArcelorMittal’s exposure to the attractive, downstream, value-
added tubular market. It is a global leader in premium tubular
solutions for energy markets and demanding industrial
applications, offering innovative, safe and competitive products
for sectors including energy, automotive and construction.
85
%
of Vallourec’s
2.2
million tonnes of annual rolling capacity is
focused around low-carbon, integrated productions hubs in US
and Brazil, both of which are important strategic markets for
ArcelorMittal
.
The fair value of ArcelorMittal's investment was
price.
225
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
China Oriental
China Oriental Group Company Limited (“China Oriental”) is a
Chinese integrated iron and steel company listed on the Hong
Kong Stock Exchange (“HKEx”). The China Oriental Group has
manufacturing plants in Hebei Province and Guangdong
Province of the People’s Republic of China (the “PRC”) and
sells mainly to customers located in the PRC. The China
Oriental Group also carries out property development business
which is mainly in the PRC.
DHS Group
DHS - Dillinger Hütte Saarstahl AG (“DHS Group”), incorporated
and located in Germany, is a leading producer of heavy steel
plates, cast slag pots and semi-finished products, such as
pressings, pressure vessel heads and shell sections in Europe.
The DHS Group also includes a further rolling mill operated by
Dillinger France in Dunkirk (France).
Gonvarri Steel Industries
Holding Gonvarri SL (“Gonvarri Steel Industries”) is dedicated to
the processing of steel. The entity is a European leader in steel
service centers and renewable energy components, with strong
presence in Europe and Latin America.
Baffinland
Baffinland Iron Mines Corporation ("Baffinland") owns the Mary
River project, which has direct shipping, high grade iron ore on
Baffin Island in Nunavut (Canada).
individually material
The Company has interests in a number of other joint ventures
and associates, none of which are regarded as individually
material.
The following table summarizes the financial
information of all individually immaterial joint ventures and
associates that are accounted for using the equity method:
|
December 31, 2024
|
December 31, 2023
|
|||||||||||
|
Associates
|
Joint
Ventures
|
Total
|
Associates
|
Joint
Ventures
|
Total
|
|||||||
|
Carrying amount of interests in associates and joint ventures
|
|
|
|
|
|
|
||||||
|
Share of:
|
||||||||||||
|
Income from continuing operations
|
|
|
|
|
|
|
||||||
|
Other comprehensive income (loss)
|
|
|
|
|
(
|
|
||||||
|
Total comprehensive income (loss)
|
|
|
|
|
|
|
||||||
In the fourth quarter of 2023, Acciaierie d'Italia's financial
condition has deteriorated due in particular to the continued high
cost of energy and the repeal of relief measures for energy-
intensive companies. It has been experiencing liquidity issues,
which have resulted in conflicts with suppliers. ArcelorMittal, the
Italian Government and Invitalia discussed the terms and
conditions of a possible support to Acciaierie d'Italia to address
its short-term cash needs and the funding requirements to
enable it to complete the acquisition of Ilva’s business units but
the parties were not able to reach agreement on how to address
Acciaierie d'Italia’s funding needs. As of December 31, 2023 t
he
Company assessed the above facts as indicators of impairment
with respect to its investment, further confirmed by the
extraordinary administration of Acciaierie d'Italia effective
February 20, 2024 (see note 2.4.1), and performed accordingly
a value in use calculation resulting in
a
1,405
impairment loss
.
The Company is not aware of any material contingent liabilities
related to associates and joint ventures for which it is severally
liable for all or part of the liabilities of the associates, nor are
there any contingent liabilities incurred jointly with other
investors. See note 9.4 for disclosure of commitments related to
The Company had investments in the following joint operations
as of
December 31, 2024
and 2023:
Peña Colorada
Peña Colorada is an iron ore mine located in Mexico in which
ArcelorMittal holds a
50.00
%
interest. Peña Colorada operates
an open pit mine as well as concentrating facility and two-line
pelletizing facility. Peña Colorada is part of the North America
instruments for which the Company does not have significant
influence. The Company irrevocably elected to present the
changes in fair value of such equity instruments, which are not
held for trading, in other comprehensive income, because these
investments are held as long-term strategic investments that are
226
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
investments include the following:
|
December 31,
|
|||
|
2024
|
2023
|
||
|
Erdemir
|
|
|
|
|
ArcelorMittal XCarb®
|
|
|
|
|
Stalprodukt S.A.
|
|
|
|
|
Others
|
|
|
|
|
Investments in equity instruments at
FVOCI
|
|
|
|
The Company’s significant investments in equity instruments at
FVOCI at
December 31, 2024
and 2023 were the following:
Ereĝli Demir ve Çelik Fabrikalari T.A.S. (“Erdemir”)
Erdemir is the leading steel producer in Turkey and produces
plates, hot and cold rolled, tin chromium and zinc coated flat
steel and supplies basic inputs to automotive, white goods,
pipes and tubes, rolling, manufacturing, electrics-electronics,
mechanical engineering, energy, heating equipment,
shipbuilding, defense and packaging industries.
In 2023, the Company's investment in Erdemir decreased from
interest. Sales were completed at the Istanbul stock exchange
for net proceeds of
227
and
626
for the year ended December
31, 2024 and 2023, respectively. Accumulated revaluation gains
of
75
and
333
for the year ended
December 31, 2024 and 2023,
respectively,
were transferred from other comprehensive income
to retained earnings.
Unrealized gains (losses) recognized in other comprehensive
income wer
e
26
and
(
105
)
for the year ended
December 31,
2024
and 2023, respectively.
ArcelorMittal’s
XCarb®
innovation fund
ArcelorMittal has launched an innovation fund which invests up
to
100
annually in groundbreaking companies developing
pioneering or breakthrough technologies which will accelerate
the steel industry's transition to carbon neutral steelmaking.
Since the launch of the
XCarb®
innovation fund in March 2021,
ArcelorMittal has invested
200
, including
11
and
66
in 2024 and
2023, respectively, in equity instruments at FVOCI.
In 2022,
ArcelorMittal
delivered an additional
17.5
equity
injection in Form Energy, a company working to accelerate the
development of breakthrough low-cost energy storage
technology to enable a reliable, secure, and fully-renewable
electric grid year-round. In addition, in 2022, ArcelorMittal
invested
25
in nuclear innovation company TerraPower.
On January 26, 2023, ArcelorMittal invested
36
in Boston Metal,
which is developing and commercializing a patented Molten
Oxide Electrolysis (MOE) platform for decarbonizing primary
steelmaking and is targeting commercialization of this
technology by 2026. On June 30, 2023, ArcelorMittal completed
also a second
25
investment in TerraPower.
Unrealized (losses)
recognized in other comprehensive income
were
(
13
)
and
(
18
)
for the
year ended
December 31, 2024
and
2023, respectively.
Stalprodukt S.A.
Stalprodukt S.A. is a leading manufacturer and exporter of
highly processed st
eel products based in Poland. Unrealized
(losses) gains recognized in other comprehensive income were
(
3
)
and
8
for the year ended
December 31, 2024
and 2023,
respectivel
y.
ventures and other investments
other investments consisted of the following:
|
Year ended December 31,
|
|||||
|
2024
|
2023
|
2022
|
|||
|
Share in net earnings of
equity-accounted companies
|
|
|
|
||
|
Impairment charges
|
|
(
|
|
||
|
Dividend income
1
|
|
|
|
||
|
Total
|
|
(
|
|
||
1.
Mainly
117
dividend income from Erdemir in 2022.
its organizational structure and to components of the Group
whose operating results are regularly reviewed by the chief
operating decision maker ("CODM"). India and joint ventures are
reported as a new operating segment including the joint
ventures AMNS India, VAMA and AMNS Calvert as well as other
associates, joint ventures ("JVs") and other investments. The
segment Sustainable Solutions is composed of a number of
niche, capital light businesses playing an important role in
supporting climate action. They were previously reported within
the Europe segment and are now reported as a separate
operating segment. The NAFTA segment is renamed North
America. Finally, following the sale of the Company’s operations
in Kazakhstan, the remaining parts of the former ACIS segment
is assigned to Others. Segment disclosures have been recast to
reflect this new segmentation in conformity with IFRS.
The
Company is organized in
six
operating and reportable
segments, which are components engaged in business activities
227
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
from which they may earn revenues and incur expenses
(including revenues and expenses relating to transactions with
other components of the Company), for which discrete financial
information is available and whose operating results are
evaluated regularly by the CODM to make decisions about
resources to be allocated to the segment and assess its
performance. Segment performance is measured based on
income from investments in associates, joint ventures and other
investments for India and JVs and operating income for the
other operating segments.
The Company CODM is the
Executive Office comprising the Executive Chairman, Mr.
Lakshmi N. Mittal and the CEO, Mr. Aditya Mittal.
ArcelorMittal's operating segments include the attributable
goodwill, intangible assets, property, plant and equipment, and
certain equity method investments. They do not include cash
and short-term deposits, short-term investments, tax assets and
other current financial assets. Attributable liabilities are also
those resulting from the normal activities of the segment,
excluding tax liabilities and indebtedness but including post
retirement obligations where directly attributable to the segment.
The treasury function is managed centrally for the Company and
is not directly attributable to individual operating segments or
geographical areas.
ArcelorMittal’s segments are structured as follows:
•
North America represents the flat, long and tubular facilities
of the Company located in Canada, Mexico and the United
States. North America produces hot briquetted iron and flat
products such as slabs, hot-rolled coil, cold-rolled coil,
coated steel and plate. These products are sold primarily to
customers in the following sectors: automotive, energy,
construction, packaging and appliances and via distributors
or processors. North America also produces long products
such as wire rod, sections, rebar, billets, blooms and wire
drawing, and tubular products. The raw material supply of
the North America operations includes sourcing from iron
ore captive mines in Mexico to supply the steel facilities.
•
Brazil includes the flat operations of Brazil, the long and
tubular operations of Brazil and neighboring countries
including Argentina, Costa Rica and Venezuela. Flat
products include slabs, hot-rolled coil, cold-rolled coil and
coated steel.
These products are sold primarily to
customers in the construction, power generation and
agribusiness sectors, as well as in the automotive and
household appliances industries.
Long
products consist of
wire rod, sections, bar and rebar, billets, blooms and wire
drawing. The raw material supply of the Brazil operations
includes sourcing from iron ore captive mines in Brazil.
•
Europe is the largest flat steel producer in Europe, with
operations that range from Spain in the west to Romania in
the east, and covering the flat carbon steel product portfolio
in all major countries and markets. Europe produces hot-
rolled coil, cold-rolled coil, coated products, tinplate, plate
and slab. These products are sold primarily to customers in
the automotive, general and packaging sectors. Europe
also produces long products consisting of sections, wire
rod, rebar, billets, blooms and wire drawing, and tubular
products. The raw material supply of Europe operations
includes sourcing from iron ore captive mines in Bosnia &
Herzegovina.
•
India and JVs includes all of the Company's interests in
joint ventures, associates and other investments.
India is a
high growth vector of the Company, with its assets well-
positioned to grow with the domestic market.
•
Sustainable Solutions is focused on growing niche
businesses providing vital added-value support to growing
sustainable related applications from a low-carbon, capital
light asset base. These businesses include: a) Construction
solutions: product offerings include sandwich panels (e.g.
insulation), profiles and turnkey pre-fabrication solutions to
assist building in smarter ways and reduce the carbon
footprint of buildings; b) Projects: product range includes
plates, pipes & tubes, wire ropes, reinforced steels,
providing high-quality & sustainable steel solutions for
energy projects and supporting offshore wind, energy
transition and onshore construction; c) Industeel: EAF
based capacity for high quality steel grades designed to
meet demanding customer specifications (e.g. XCarb® for
wind turbines) and supplying a wide range of industries
(energy, chemicals, mechanical engineering, machinery,
infrastructure, defense & security); d) Renewables:
investments in renewable energy projects; e) Metallics:
investment and development of the Company’s scrap
recycling and collection capabilities; f) Distribution & service
centers: European services processor including slitting, cut-
to-length, multi blanking, and press blanking and operating
through an extensive network.
•
Mining segment comprises the mines owned by
ArcelorMittal in Canada and Liberia. It provides the
Company's steel operations with high quality and low-cost
iron ore reserves and also sells mineral products to third
228
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
North
America
|
Brazil
|
Europe
|
India and
JVs
|
Sustainable
solutions
|
Mining
|
Others
1
|
Elimination
|
Total
|
|||||||||
|
Year ended December 31, 2024
|
|||||||||||||||||
|
Sales to external customers
|
|
|
|
—
|
|
|
|
—
|
|
||||||||
|
Intersegment sales
2
|
|
|
|
—
|
|
|
|
(
|
—
|
||||||||
|
Operating income (loss)
|
|
|
|
—
|
|
|
(
|
|
|
||||||||
|
Depreciation and amortization
|
(
|
(
|
(
|
—
|
(
|
(
|
(
|
|
(
|
||||||||
|
Income from investments in
associates, joint ventures and
other investments
|
—
|
—
|
—
|
|
—
|
—
|
—
|
—
|
|
||||||||
|
Impairment
|
|
(
|
(
|
—
|
|
|
(
|
|
(
|
||||||||
|
Capital expenditures
|
|
|
|
—
|
|
|
|
(
|
|
||||||||
|
Year ended December 31, 2023
|
|||||||||||||||||
|
Sales to external customers
|
|
|
|
—
|
|
|
|
—
|
|
||||||||
|
Intersegment sales
2
|
|
|
|
—
|
|
|
|
(
|
—
|
||||||||
|
Operating income (loss)
|
|
|
|
—
|
|
|
(
|
|
|
||||||||
|
Depreciation and amortization
|
(
|
(
|
(
|
—
|
(
|
(
|
(
|
|
(
|
||||||||
|
Income from investments in
associates, joint ventures and
other investments
|
—
|
—
|
—
|
|
—
|
—
|
—
|
—
|
|
||||||||
|
Impairment
|
|
|
|
—
|
|
|
(
|
|
(
|
||||||||
|
Capital expenditures
|
|
|
|
—
|
|
|
|
(
|
|
||||||||
|
Year ended December 31, 2022
|
|||||||||||||||||
|
Sales to external customers
|
|
|
|
—
|
|
|
|
—
|
|
||||||||
|
Intersegment sales
2
|
|
|
|
—
|
|
|
|
(
|
—
|
||||||||
|
Operating income (loss)
|
|
|
|
—
|
|
|
(
|
|
|
||||||||
|
Depreciation and amortization
|
(
|
(
|
(
|
—
|
(
|
(
|
(
|
|
(
|
||||||||
|
Income from investments in
associates, joint ventures and
other investments
|
—
|
—
|
—
|
|
—
|
—
|
—
|
—
|
|
||||||||
|
Impairment
|
|
|
|
—
|
|
|
(
|
|
(
|
||||||||
|
Capital expenditures
|
|
|
|
—
|
|
|
|
(
|
|
1.
Others mainly include holdings and services companies and the Company's operations in Ukraine and South Africa (and in Kazakhstan for the year ended December 31,
2023 and 2022)
. Others also include all other operational and non-operational items which are not segmented, such as corporate and shared services, financial activities,
and shipping and logistics.
2.
Transactions between segments are reported on the same basis of accounting as transactions with third parties.
229
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
(including non-controlling interests) is as follows:
|
Year ended December 31,
|
|||||
|
2024
|
2023
|
2022
|
|||
|
Operating income
|
|
|
|
||
|
Income from investments in
associates and joint ventures
|
|
|
|
||
|
Impairments of equity method
investments
|
|
(
|
|
||
|
Financing costs - net
|
(
|
(
|
(
|
||
|
Income before taxes
|
|
|
|
||
|
Income tax expense
|
|
|
|
||
|
Net income (including non-
controlling interests)
|
|
|
|
||
The Company does not regularly provide a measure of total
Geographical information, by country or region, is separately
disclosed and represents ArcelorMittal’s most significant
regional markets. Attributed assets are operational assets
employed in each region and include items such as pension
balances that are specific to a country. Unless otherwise stated
in the table heading as a segment disclosure, these disclosures
are specific to the country or region stated. They do not include
goodwill, deferred tax assets, other investments or receivables
and other non-current financial assets. Attributed liabilities are
those arising within each region, excluding indebtedness.
Sales (by destination)
|
Year ended December 31,
|
|||||
|
|
2024
|
2023
|
2022
|
||
|
Americas
|
|
|
|
||
|
United States
|
|
|
|
||
|
Brazil
|
|
|
|
||
|
Canada
|
|
|
|
||
|
Mexico
|
|
|
|
||
|
Argentina
|
|
|
|
||
|
Others
|
|
|
|
||
|
Total Americas
|
|
|
|
||
|
Europe
|
|
|
|
||
|
Germany
|
|
|
|
||
|
Poland
|
|
|
|
||
|
France
|
|
|
|
||
|
Spain
|
|
|
|
||
|
Italy
|
|
|
|
||
|
Czech Republic
|
|
|
|
||
|
Turkey
|
|
|
|
||
|
United Kingdom
|
|
|
|
||
|
Belgium
|
|
|
|
||
|
Netherlands
|
|
|
|
||
|
Russia
|
|
|
|
||
|
Romania
|
|
|
|
||
|
Ukraine
|
|
|
|
||
|
Others
|
|
|
|
||
|
Total Europe
|
|
|
|
||
|
Asia & Africa
|
|||||
|
South Africa
|
|
|
|
||
|
Morocco
|
|
|
|
||
|
Rest of Africa
|
|
|
|
||
|
China
|
|
|
|
||
|
Kazakhstan
1
|
|
|
|
||
|
South Korea
|
|
|
|
||
|
India
|
|
|
|
||
|
Rest of Asia
|
|
|
|
||
|
Total Asia & Africa
|
|
|
|
||
|
Total
|
|
|
|
||
1.
On December 7, 2023, the Company completed the divestment of
ArcelorMittal Temirtau. Sales of ArcelorMittal Temirtau were consolidated
until that date see note 2.3.
Revenues from external customers attributed to the country of
domicile (Luxembourg) were
108
,
128
and
206
for the years
ended
December 31, 2024
,
2023
and
2022
, respectively.
230
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
Non-current assets
1
per significant country:
|
December 31,
|
|||
|
2024
|
2023
|
||
|
Americas
|
|
|
|
|
Canada
|
|
|
|
|
Brazil
2
|
|
|
|
|
Mexico
|
|
|
|
|
United States
|
|
|
|
|
Argentina
|
|
|
|
|
Others
|
|
|
|
|
Total Americas
|
|
|
|
|
Europe
|
|||
|
France
|
|
|
|
|
Belgium
|
|
|
|
|
Germany
|
|
|
|
|
Poland
|
|
|
|
|
Spain
|
|
|
|
|
Luxembourg
|
|
|
|
|
Ukraine
|
|
|
|
|
Bosnia and Herzegovina
|
|
|
|
|
Italy
|
|
|
|
|
Others
|
|
|
|
|
Total Europe
|
|
|
|
|
Asia & Africa
|
|||
|
Liberia
|
|
|
|
|
India
|
|
|
|
|
South Africa
|
|
|
|
|
Morocco
|
|
|
|
|
Others
|
|
|
|
|
Total Asia & Africa
|
|
|
|
|
Unallocated assets
|
|
|
|
|
Total
|
|
|
|
1.
Non-current assets do not include goodwill, deferred tax assets, investments
in associates and joint ventures, other investments and other non-current
financial assets (as they are not allocated to the individual countries). Such
product type. In addition to steel produced by the Company,
amounts include material purchased for additional
transformation and sold through distribution services. Mining
products relate to the Company's own production. Others mainly
include non-steel and by-products sales, manufactured and
specialty steel products sales, shipping and other services.
|
|
Year ended December 31,
|
||||
|
|
2024
|
2023
|
2022
|
||
|
Flat products
|
|
|
|
||
|
Long products
|
|
|
|
||
|
Tubular products
|
|
|
|
||
|
Mining products
|
|
|
|
||
|
Others
|
|
|
|
||
|
Total
|
|
|
|
||
Disaggregated revenue
|
Year ended December 31, 2024
|
North
America
|
Brazil
|
Europe
|
Sustainable
solutions
|
Mining
|
Others
|
Total
|
||||||
|
Steel sales
|
|
|
|
|
|
|
|
||||||
|
Non-steel sales
1
|
|
|
|
|
|
|
|
||||||
|
By-product sales
2
|
|
|
|
|
|
|
|
||||||
|
Other sales
3
|
|
|
|
|
|
|
|
||||||
|
Total
|
|
|
|
|
|
|
|
231
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
Year ended December 31, 2023
|
North
America
|
Brazil
|
Europe
|
Sustainable
solutions
|
Mining
|
Others
|
Total
|
||||||
|
Steel sales
|
|
|
|
|
|
|
|
||||||
|
Non-steel sales
1
|
|
|
|
|
|
|
|
||||||
|
By-product sales
2
|
|
|
|
|
|
|
|
||||||
|
Other sales
3
|
|
|
|
|
|
|
|
||||||
|
Total
|
|
|
|
|
|
|
|
|
Year ended December 31, 2022
|
North
America
|
Brazil
|
Europe
|
Sustainable
solutions
|
Mining
|
Others
|
Total
|
||||||
|
Steel sales
|
|
|
|
|
|
|
|
||||||
|
Non-steel sales
1
|
|
|
|
|
|
|
|
||||||
|
By-product sales
2
|
|
|
|
|
|
|
|
||||||
|
Other sales
3
|
|
|
|
|
|
|
|
||||||
|
Total
|
|
|
|
|
|
|
|
1.
Non-steel sales mainly relate to iron ore, coal, scrap and electricity.
2.
By-product sales mainly relate to slag, waste and coke by-products.
3.
Other sales are mainly comprised of shipping and other services.
obligation to
transfer primarily steel and mining products
under
arrangements in which the transfer of control of the products
and the fulfillment of the Company’s performance obligation
occur at the same time. Revenue from the sale of goods is
recognized when the Company has transferred control of the
goods to the buyer and the buyer obtains the benefits from the
goods, the potential cash flows and the amount of revenue (the
transaction price) can be measured reliably, and it is probable
that the Company will collect the consideration to which it is
entitled to in exchange for the goods.
Whether the customer has obtained control over the asset
depends on when the goods are made available to the carrier or
the buyer takes possession of the goods, depending on the
delivery terms. For the Company’s steel producing operations,
generally the criteria to recognize revenue has been met when
its products are delivered to its customers or to a carrier who will
transport the goods to its customers, this is the point in time
when the Company has completed its performance obligations.
Revenue is measured at the transaction price of the
consideration received or receivable, the amount the Company
expects to be entitled to.
Additionally, the Company identifies when goods have left its
premises, not when the customer receives the goods.
Therefore, the Company estimates, based on its historical
experience, the amount of goods in-transit when the transfer of
control occurs at the destination and defers the revenue
recognition.
The Company’s products must meet customer specifications. A
certain portion of the Company’s products are returned or have
claims filed against the sale because the products contained
quality defects or other problems. Claims may be either of the
following:
–
Product Rejection - Product shipped and billed to an
end customer that did not meet previously agreed
customer specifications. Claims typically result from
physical defects in the goods, goods shipped to the
wrong location, goods produced with incorrect
specifications and goods shipped outside acceptable
time parameters.
–
Consequential Damages - Damages reported by the
customer not directly related to the value of the
rejected goods (for example: customer processing cost
or mill down time, sampling, storage, sorting,
administrative cost, replacement cost, etc.).
The Company estimates the variable consideration for such
claims using the expected value method and reduces the
amount of revenue recognized.
Warranties:
The warranties and claims arise when the product fails on the
criteria mentioned above. Sales-related warranties associated
with the goods cannot be purchased separately and they serve
as an assurance that the products sold comply with agreed
specifications. Accordingly, the Company accounts for
warranties in accordance with IAS 37 "Provisions, Contingent
Liabilities and Contingent Assets" (see note 9).
Periodically, the Company enters into volume or other rebate
programs where once a certain volume or other conditions are
met, it refunds the customer some portion of the amounts
232
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
previously billed or paid. For such arrangements, the Company
only recognizes revenue for the amounts it ultimately expects to
realize from the customer. The Company estimates the variable
consideration for these programs using the most likely amount
method or the expected value method, whichever approach best
predicts the amount of the consideration based on the terms of
the contract and available information and updates its estimates
each reporting period.
The Company’s payment terms range from
30 to 90
days from
date of delivery, depending on the market and product sold. The
Company received
505
and
351
as of December 31, 2024, and
2023, respectively, as advances from its customers which are
classified as unsatisfied performance obligations and
recognized as liabilities in line with IFRS 15. The Company
expects
100
%
of these unsatisfied performance obligations as
of
December 31, 2024
to be recognized as revenue during
2025
as the Company’s contracts have an original expected duration
of one year or less.
Company's trade receivable and other for the years ended
December 31, 2024, 2023 and 2022.
|
Year ended December 31,
|
|||||
|
2024
|
2023
|
2022
|
|||
|
Trade accounts receivable and
other - opening balance
|
|
|
|
||
|
Performance obligations
satisfied
|
|
|
|
||
|
Payments received
|
(
|
(
|
(
|
||
|
Impairment of receivables (net
of write backs and utilization)
|
(
|
(
|
|
||
|
Recognition (derecognition) of
receivables related to business
combination and divestments
1
|
|
|
|
||
|
Foreign exchange and others
|
(
|
|
(
|
||
|
Trade accounts receivable and
other - closing balance
|
|
|
|
||
1.
2024 consists receivables acquired as part of acquisition of Italpannelli SRL.
2023 mainly included receivables acquired as part of acquisition of
ArcelorMittal Pecém (see note 2.2.4) and receivables from ArcelorMittal
Temirtau recognized upon disposal partially offset by the derecognition of
ArcelorMittal Temirtau's receivables (see note 2.3). 2022 included mainly
receivables acquired as part of acquisition of ArcelorMittal Texas HBI (see
note 2.2.4).
|
|
Year ended December 31,
|
||||
|
|
2024
|
2023
|
2022
|
||
|
Materials
|
|
|
|
||
|
Labor costs
|
|
|
|
||
|
Logistic expenses
|
|
|
|
||
|
Depreciation and amortization
|
|
|
|
||
|
Impairment charges (note 5.3)
|
|
|
|
||
|
Foreign exchange translation
losses upon disposal of
Kazakhstan operations (note
2.3)
|
|
|
|
||
|
Other
|
|
|
|
||
|
Total
|
|
|
|
||
transaction price and do not carry any interest. ArcelorMittal
maintains an allowance for lifetime expected credit loss at an
amount that it considers to be a reliable estimate of expected
credit losses resulting from the inability of its customers to make
required payments. In judging the adequacy of the allowance for
expected credit losses, ArcelorMittal considers multiple factors
including historical bad debt experience, the current and forward
looking economic environment and the aging of the receivables.
Recoveries of trade receivables previously reserved in the
allowance for expected credit losses are recognized as gains in
selling, general and administrative expenses.
ArcelorMittal’s policy is to record an allowance for expected
lifetime credit losses and a charge in selling, general and
administrative expense when a specific account is deemed
uncollectible. The Company concluded that a trade receivable is
in default when it is overdue by more than
180
days
. Based on
historical experience and analysis, the Company concluded that
there is a risk of default as such receivables are generally not
recoverable and therefore provided for, unless the collectability
can be clearly demonstrated. Uninsured trade receivables and
the associated allowance are written off when ArcelorMittal has
exhausted its recovery efforts and enforcement options.
ArcelorMittal continuously considered the impacts on the current
economic environment in its risk of default assessment for
receivables outstanding less than
180
days
. Receivables aged
consistent with historical levels and the Company did not identify
233
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
Trade accounts receivable and allowance for lifetime expected
credit losses
|
|
December 31,
|
||
|
|
2024
|
2023
|
|
|
Gross amount
|
|
|
|
|
Allowance for lifetime expected credit losses
|
(
|
(
|
|
|
Total
|
|
|
|
The carrying amount of the trade accounts receivable and other
approximates their fair value. Before granting credit to any new
customer, ArcelorMittal uses an internally developed credit
scoring system to assess the potential customer’s credit quality
and to define credit limits by customer. For all significant
customers, the credit terms must be approved by the credit
committees of each reportable segment. Limits and scoring
attributed to customers are reviewed periodically. There are
no
customers who represent more than
5%
of the total balance of
trade accounts receivable.
Exposure to credit risk by reportable segment
receivable by reportable segment and others is as follows:
|
|
December 31,
|
||
|
|
2024
|
2023
|
|
|
North America
|
|
|
|
|
Brazil
|
|
|
|
|
Europe
|
|
|
|
|
Sustainable Solutions
|
|
|
|
|
Mining
|
|
|
|
|
Others
|
|
|
|
|
Total
|
|
|
|
|
|
December 31,
|
December 31,
|
|||||||||
|
|
2024
|
2023
|
|||||||||
|
|
Gross
|
Allowance
|
Total
|
Gross
|
Allowance
|
Total
|
|||||
|
Not past due
|
|
(
|
|
|
(
|
|
|||||
|
Overdue 1-30 days
|
|
(
|
|
|
(
|
|
|||||
|
Overdue 31-60 days
|
|
(
|
|
|
(
|
|
|||||
|
Overdue 61-90 days
|
|
(
|
|
|
(
|
|
|||||
|
Overdue 91-180 days
|
|
(
|
|
|
(
|
|
|||||
|
More than 180 days
|
|
(
|
|
|
(
|
|
|||||
|
Total
|
|
(
|
|
|
(
|
|
|||||
The movements in the allowance are calculated based on
lifetime expected credit loss model for 2024, 2023 and 2022.
the periods presented are as follows:
|
Year ended December 31,
|
|||||
|
2024
|
2023
|
2022
|
|||
|
Allowance - opening
balance
|
|
|
|
||
|
Additions
|
|
|
|
||
|
Write backs / utilization
|
(
|
(
|
(
|
||
|
Foreign exchange and
others
|
(
|
|
(
|
||
|
Allowance - closing
balance
|
|
|
|
||
The Company has established a number of programs for sales
without recourse of trade accounts receivable to various
financial institutions (referred to as true sale of receivables
(“TSR”). Through the TSR programs, certain operating
subsidiaries of ArcelorMittal surrender the control, risks and
benefits associated with the accounts receivable sold; therefore,
the amount of receivables sold is recorded as a sale of financial
assets and the balances are derecognized from the
consolidated statements of financial position at the moment of
sale. The Company classifies trade receivables subject to TSR
as financial assets that are held to collect or to sell and
recognizes them at FVOCI (see note 6). The fair value
measurement is determined based on the invoice amount net of
TSR expense payable, a Level 3 unobservable input. The TSR
expense is insignificant due to the rate applicable and the short
timeframe between the time of sale and the invoice due date.
Any loss allowance for these trade receivables is recognized in
OCI.
As of December 31, 2024 and 2023, the total amount of
trade accounts
receivables
sold amounted to
4.4
billion
and
4.5
billion
, respectively.
value. Cost is determined using the average cost method. Costs
of production in process and finished goods include the
234
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
purchase costs of raw materials and conversion costs such as
direct labor and an allocation of fixed and variable production
overheads. Raw materials and spare parts are valued at cost,
inclusive of freight, shipping, handling as well as any other costs
incurred in bringing the inventories to their present location and
condition. Interest charges, if any, on purchases have been
recorded as financing costs. Costs incurred when production
levels are abnormally low are capitalized as inventories based
on normal capacity with the remaining costs incurred recorded
as a component of cost of sales in the consolidated statements
of operations.
Net realizable value represents the estimated selling price at
which the inventories can be realized in the normal course of
business after allowing for the cost of conversion from their
existing state to a finished condition and for the cost of
marketing, selling, and distribution. Net realizable value is
estimated based on the most reliable evidence available at the
time the estimates were made of being the amount that the
inventory is expected to realize, taking into account the purpose
for which the inventory is held.
Previous write-downs are reversed in case the circumstances
that previously caused inventories to be written down below cost
of cost over net realizable value and obsolescence of
1,370
and
comprised of the following:
|
|
December 31,
|
||
|
|
2024
|
2023
|
|
|
Finished products
|
|
|
|
|
Production in process
|
|
|
|
|
Raw materials
|
|
|
|
|
Manufacturing supplies, spare parts and
other
1
|
|
|
|
|
Total
|
|
|
|
1.
Including spare parts of
1.7
billion
and
1.7
billion
, and manufacturing and other
supplies of
0.5
billion
and
0.6
billion
as of
December 31, 2024
and
2023
,
|
Year ended December 31,
|
|||||
|
2024
|
2023
|
2022
|
|||
|
Inventory write-downs -
opening balance
|
|
|
|
||
|
Additions
1
|
|
|
|
||
|
Deductions / Releases
2
|
(
|
(
|
(
|
||
|
Foreign exchange and others
|
(
|
(
|
(
|
||
|
Inventory write-downs -
closing balance
|
|
|
|
||
1.
Additions refer to write-downs of inventories excluding those utilized or written
back during the same financial year.
2.
Deductions/releases correspond to write-backs and utilization related to the
prior periods.
|
December 31,
|
|||
|
2024
|
2023
|
||
|
VAT receivables
|
|
|
|
|
Prepaid expenses and non-trade
receivables
|
|
|
|
|
Financial amounts receivable
2
|
|
|
|
|
Income tax receivable
|
|
|
|
|
Receivables from public authorities
|
|
|
|
|
Receivables from sale of intangible, tangible
and financial assets
|
|
|
|
|
Derivative financial instruments (notes 6.1
and 6.3)
|
|
|
|
|
CO
2
emission rights
|
|
|
|
|
Other
1
|
|
|
|
|
Total
|
|
|
|
1.
Other included mainly advances to employees, accrued interest and other
miscellaneous receivables.
2.
Includes
98
and
114
of outstanding receivables in connection with the sale of
ArcelorMittal Temirtau, at December 31, 2024 and 2023, respectively (see
note 2.3).
|
|
December 31,
|
||
|
|
2024
|
2023
|
|
|
Derivative financial instruments (notes 6.1
and 6.3)
|
|
|
|
|
Financial amounts receivable
2
|
|
|
|
|
Long-term VAT receivables
|
|
|
|
|
Cash guarantees and deposits
|
|
|
|
|
Receivables from public authorities
|
|
|
|
|
Accrued interest
|
|
|
|
|
Receivables from sale of intangible, tangible
and financial assets
|
|
|
|
|
Income tax receivable
|
|
|
|
|
Other
1
|
|
|
|
|
Total
|
|
|
|
1.
Other mainly include
s assets in pension funds and other amounts receivable
.
2.
Includes
197
and
342
of outstanding receiv
ables in connection with the sale
of ArcelorMittal Temirtau, at December 31, 2024 and 2023, respectively (see
have been acquired in the ordinary course of business from
suppliers. Trade accounts payable have maturities from
15
to
235
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
area in which the purchase transaction occurs and the various
contractual agreements. The carrying value of trade accounts
payable approximates fair value.
The Company’s average
outstanding number of trade payable days amounted to
83
over
the last
5
years.
Certain contractual arrangements with the longest maturities
enable suppliers, at their own discretion, to early discount their
receivables due from the Company to obtain funding for their
own working capital needs. The Company has determined that
such arrangements did neither lead to the extinguishment of the
liability against the supplier nor resulted in significant
modifications of amounts payable and applicable terms and
conditions. Accordingly, in the consolidated statement of
financial position the corresponding payables remain classified
as trade accounts payables until they are settled at their agreed
due dates, and the corresponding cash outflows are classified
as part of the operating activities in the consolidated statement
As of December 31, 2024, the Company estimates that about
above-mentioned contractual arrangements as compared to
2.9
billion in 2023
and the Company estimates that similar amounts
of trade
payables
were early discounted by its suppliers in 2024
and 2023.
following:
|
December 31,
|
|||
|
2024
|
2023
|
||
|
Accrued payroll and employee related
expenses
|
|
|
|
|
Accrued interest and other payables
|
|
|
|
|
Payable from acquisition of intangible,
tangible & financial assets
|
|
|
|
|
Other amounts due to public authorities
|
|
|
|
|
Derivative financial instruments (notes 6.1
and 6.3)
|
|
|
|
|
Unearned revenue and accrued payables
|
|
|
|
|
Total
|
|
|
|
summarized as follows:
|
|
December 31,
|
||
|
|
2024
|
2023
|
|
|
Goodwill on acquisitions
|
|
|
|
|
Concessions, patents and licenses
|
|
|
|
|
Customer relationships and trade marks
|
|
|
|
|
Emission rights
|
|
|
|
|
Other
|
|
|
|
|
Total
|
|
|
|
Goodwill arising on an acquisition is recognized as previously
described within the business combinations section in note
2.2.3. Goodwill is allocated to those GCGUs that are expected
to benefit from the business combination in which the goodwill
arose and in all cases is at the operating segment level, which
represents the lowest level at which goodwill is monitored for
internal management purposes except for goodwill allocated to
AMKR CGU in Ukraine and AMSA GCGU in South Africa (see
below).
As described in note 3.1, effective January 1, 2024, the
Company has revised it
s operating segments following changes
to its organizational structure and to components of the Group
whose operating results are regularly reviewed by the CODM.
Accordingly, there are
six
operating and reportable segments:
North America, Brazil, Europe, India and JVs, Sustainable
Solutions and Mining. The discussion within this note reflects
the impairment test results as of October 1 for the years ended
December 31, 2024 and
2023
. Following the decision to revise
its segments, the Company reallocated
242
and
174
goodwill
from the former ACIS GCGU to the AMKR CGU in Ukraine and
to AMSA GCGU in South Africa, respectively. In addition, with
respect to the Europe operating segment,
98
goodwill was
reallocated to the Sustainable Solutions operating segment
based on the relative enterprise values of the underlying
businesses.
Company’s operating segments and certain other CGUs and
GCGUs
retrospectively adjusted for the change in segmentation
is as follows:
|
|
December
31, 2023
|
Acquisitions
1
|
Foreign exchange
differences and
other movements
|
December
31, 2024
|
|
North America
|
|
|
(
|
|
|
Brazil
|
|
|
(
|
|
|
Europe
|
|
|
(
|
|
|
Sustainable Solutions
|
|
|
(
|
|
|
Others
3
|
|
|
(
|
|
|
Total
|
|
|
(
|
|
236
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
|
December
31, 2022
|
Acquisitions
1
|
Foreign
exchange
differences
and other
movements
|
Divestments
2
|
December
31, 2023
|
|
North America
|
|
|
|
|
|
|
Brazil
|
|
|
|
|
|
|
Europe
|
|
|
|
|
|
|
Sustainable
Solutions
|
|
|
|
|
|
|
Others
3
|
|
|
(
|
(
|
|
|
Total
|
|
|
|
(
|
|
1.
See note 2.2.4
2.
See note 2.3
3.
Includes the CGU AMKR and the GCGU AMSA
Prior to January 1, 2024, the Company's goodwill impairment
testing was performed on the basis
of
five
operating
and
reportable segments. These segments are set forth below
(excluding Mining, which does not carry goodwill).
Goodwill
acquired in business combinations for each of the Company’s
former operating segments as of December 31, 2023
is as
follows:
|
|
December
31, 2022
|
Acquisitions
1
|
Foreign
exchange
differences
and other
movements
|
Divestments
2
|
December
31, 2023
|
||||
|
NAFTA
|
|
|
|
|
|
||||
|
Brazil
|
|
|
|
|
|
||||
|
Europe
|
|
|
|
|
|
||||
|
ACIS
|
|
|
(
|
(
|
|
||||
|
Total
|
|
|
|
(
|
|
1. See note 2.2.4
2. See note 2.3
the expected future economic benefits attributable to the assets
will accrue to the Company and the cost can be reliably
measured. Intangible assets acquired separately by
ArcelorMittal are initially recorded at cost and those acquired in
a business combination are initially recorded at fair value at the
date of the business combination.
These primarily i
nclude
customer relationships and trade marks as well as emission
rights, and the cost of technology and licenses purchased from
third parties and operating authorizations granted by
governments or other public bodies (concessions). Intangible
assets are amortized on a straight-line basis over their
estimated economic useful lives, which typically do not exceed
statements of operations as part of cost of sales.
ArcelorMittal’s industrial sites which are regulated by the
European Directive 2003/87/EC of October 13, 2003 on carbon
dioxide (“CO
2
”) emission rights, effective as of January 1, 2005,
are located primarily in Belgium, France, Germany,
Luxembourg, Poland and Spain. In Ontario, Canada,
ArcelorMittal's operations have been subject to output based
pricing system regulations since January 1, 2019 but effective
January 1, 2022,
they are
regulated on carbon pricing under the
Ontario Emissions Performance System (“OEPS”)
. In South
Africa, a CO
2
tax system was introduced in 2019.
Emission rights allocated to the Company on a no-charge basis
pursuant to the annual national allocation plan are recorded at
237
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
|
Concessions,
patents and
licenses
|
Customer
relationships and
trade marks
|
Other
1
|
Total
|
|||
|
Cost
|
|
|
|
|
|||
|
At December 31, 2022
|
|
|
|
|
|||
|
Acquisitions
|
|
|
|
|
|||
|
Acquisitions through business combinations (note 2.2.4)
|
|
|
|
|
|||
|
Disposals
|
|
|
(
|
(
|
|||
|
Divestment (note 2.3.1)
|
(
|
|
|
(
|
|||
|
Foreign exchange differences
|
|
|
|
|
|||
|
Transfers and other movements
|
|
|
|
|
|||
|
At December 31, 2023
|
|
|
|
|
|||
|
Acquisitions
|
|
|
|
|
|||
|
Acquisitions through business combination (note 2.2.4)
|
|
|
|
|
|||
|
Disposal
|
|
|
(
|
(
|
|||
|
Foreign exchange differences
|
(
|
(
|
(
|
(
|
|||
|
Transfers and other movements
|
|
|
(
|
(
|
|||
|
Fully amortized intangible assets
|
(
|
(
|
(
|
(
|
|||
|
At December 31, 2024
|
|
|
|
|
|||
|
Accumulated amortization and impairment losses
|
|||||||
|
At December 31, 2022
|
|
|
|
|
|||
|
Divestment (note 2.3.1)
|
(
|
|
|
(
|
|||
|
Amortization charge
|
|
|
|
|
|||
|
Foreign exchange differences
|
|
|
|
|
|||
|
Transfers and other movements
|
(
|
|
(
|
(
|
|||
|
At December 31, 2023
|
|
|
|
|
|||
|
Amortization charge
|
|
|
|
|
|||
|
Foreign exchange differences
|
(
|
(
|
(
|
(
|
|||
|
Transfers and other movements
|
|
|
|
|
|||
|
Fully amortized intangible assets
|
(
|
(
|
(
|
(
|
|||
|
At December 31, 2024
|
|
|
|
|
|||
|
Carrying amount
|
|||||||
|
At December 31, 2023
|
|
|
|
|
|||
|
At December 31, 2024
|
|
|
|
|
Disposal of other intangible assets resulted in a
190
gain in
2024 and
414
gain in 2023.
Research and development costs not meeting the criteria for
capitalization are expensed as incurred. These costs amounted
to
285
,
299
and
286
for the years ended
December 31, 2024
,
2023
and
2022
, respectively and were recognized in selling,
accumulated depreciation and impairment. Cost includes all
related costs directly attributable to the acquisition or
construction of the asset.
Except for land and assets used in
mining activities, property, plant and equipment is depreciated
using the straight-line method over the useful lives of the related
assets as presented in the table below.
|
Asset Category
|
Useful Life Range
|
|
|
Land
|
Not depreciated
|
|
|
Buildings
|
|
|
|
Property plant & equipment
|
|
|
|
Auxiliary facilities
|
|
|
|
Other facilities
|
|
The Company’s annual review
of useful lives l
everages on the
experience gained from an in-depth review performed every five
years, any significant change in the expected pattern of
238
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
consumption embodied in the asset, and the specialized
knowledge of ArcelorMittal’s network of chief technical officers.
The chief technical officer network includes engineers with
facility-specific expertise related to plant and equipment used in
the principal production units of the Company’s operations. The
most recent in-depth review took place in
2024
, during which the
Company performed a review, which was finalized early 2025, of
the useful lives of its fixed assets and determined there were no
material changes to the useful lives of property, plant and
equipment. In performing this review, the Company gathered
and evaluated data, including commissioning dates, designed
capacities, maintenance records and programs, and asset
performance history, among other attributes. In accordance with
IAS 16, Property, Plant and Equipment, the Company
considered this information at the level of components
significant in relation to the total cost of the item of plant and
equipment. Other factors the Company considered in its
determination of useful lives included the expected use of the
assets, technical or commercial obsolescence, and operational
factors. In addition, the Company considered the accumulated
technical experience and knowledge sharing programs that
allowed for the exchange of best practices within the chief
technical officer network and the deployment of these practices
across the Company’s principal production units.
Major improvements, which add to productive capacity or extend
the life of an asset, are capitalized, while repairs and
maintenance are expensed as incurred. Where a tangible fixed
asset comprises major components having different useful lives,
these components are accounted for as separate items.
Property, plant and equipment under construction is recorded as
construction in progress until it is ready for its intended use;
thereafter it is transferred to the related class of property, plant
and equipment and depreciated over its estimated useful life.
Interest incurred during construction is capitalized if the
borrowing cost is directly attributable to the construction. Gains
and losses on retirement or disposal of assets are recognized in
cost of sales.
The residual values and useful lives of property, plant and
equipment are reviewed at each reporting date and adjusted if
expectations differ from previous estimates. Depreciation
methods applied to property, plant and equipment are reviewed
at each reporting date and changed if there has been a
significant change in the expected pattern of consumption of the
future economic benefits embodied in the asset. In the context
of the 2021 annual review of useful lives and considering the
expected date of retirement of certain assets in particular BF
and BOF, sinter plants and coke plants following the
implementation of the Company's decarbonization strategy
involving the construction of DRI - EAF facilities, the Company
decreased estimates of residual useful lives of such items of
property, plant and equipment for its flat carbon operations in
the EU and in Canada.
The Company's announcements
regarding decarbonization plans in Europe in November 2024
are not expected to significantly impact depreciation going
forward.
Mining assets comprise:
•
Mineral rights acquired;
•
Capitalized developmental stripping (as described
below in “—Stripping and overburden removal costs”).
Property, plant and equipment used in mining activities is
depreciated over its useful life or over the remaining life of the
mine, if shorter, and if there is no alternative use. For the
majority of assets used in mining activities, the economic
benefits from the asset are consumed in a pattern which is
linked to the production level and accordingly, assets used in
mining activities are primarily depreciated on a units-of-
production basis. A unit-of-production is based on the available
estimate of proven and probable reserves.
Capitalization of pre-production expenditures ceases when the
mining property is capable of commercial production as it is
intended by management. General administration costs that are
not directly attributable to a specific exploration area are
charged to the consolidated statements of operations.
Mineral Reserves and resources
Mineral Reserves are estimates of the amount of product that
can be economically and legally extracted from the Company’s
properties. Furthermore, mineral resource estimates constitute
the part of a mineral deposit that have the potential to be
economically and legally extracted or produced at the time of
the resource determination. In order to estimate mineral
reserves, estimates are required for a range of geological,
technical and economic factors, including quantities, grades,
production techniques, recovery rates, production costs,
transport costs, commodity demand, commodity prices and
exchange rates. The potential for economic viability and
estimate of mineral resources is established through high level
and conceptual engineering studies.
Estimating the quantity and/or grade of mineral reserves
requires the size, shape and depth of ore bodies to be
determined by analyzing geological data such as drilling
samples. This process may require complex and difficult
geological judgments to interpret the data. The estimation of
mineral resource is based on detailed and reliable exploration,
sampling and testing information gathered through appropriate
techniques from locations such as outcrops, trenches, pits,
workings and drill holes that are spaced closely enough to
confirm both geological and grade continuity.
Because the economic assumptions used to estimate mineral
reserves and mineral resources change from period to period,
239
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
and because additional geological data is generated during the
course of operations, estimates of mineral reserves and mineral
resources may change from period to period. Changes in
reported mineral reserves and mineral resources may affect the
Company’s financial results and financial position in a number of
ways, including the following:
•
Asset carrying amounts may be affected due to
changes in estimated future cash flows.
•
Depreciation, depletion and amortization charged in the
consolidated statements of operations may change
where such charges are determined by the units of
production basis, or where the useful economic lives of
assets change.
•
Overburden removal costs recognized in the
consolidated statements of financial position or
charged to the consolidated statements of operations
may change due to changes in stripping ratios or the
units of production basis of depreciation.
•
Decommissioning, site restoration and environmental
provisions may change where changes in estimated
reserves affect expectations about the timing or cost of
these activities.
Stripping and overburden removal costs
In open pit and underground mining operations, it is often
necessary to remove overburden and other waste materials to
access the deposit from which minerals can be extracted. This
process is referred to as stripping. Stripping costs can be
incurred before the mining production commences
(“developmental stripping”) or during the production stage
(“production stripping”).
A mine can operate several open pits that are regarded as
separate operations for the purpose of mine planning and
production. In this case, stripping costs are accounted for
separately, by reference to the ore extracted from each separate
pit. If, however, the pits are highly integrated for the purpose of
mine planning and production, stripping costs are aggregated.
The determination of whether multiple pit mines are considered
separate or integrated operations depends on each mine’s
specific circumstances. The following factors would point
towards the stripping costs for the individual pits being
accounted for separately:
•
If mining of the second and subsequent pits is
conducted consecutively with that of the first pit, rather
than concurrently.
•
If separate investment decisions are made to develop
each pit, rather than a single investment decision being
made at the outset.
•
If the pits are operated as separate units in terms of
mine planning and the sequencing of overburden and
ore mining, rather than as an integrated unit.
•
If expenditures for additional infrastructure to support
the second and subsequent pits are relatively large.
•
If the pits extract ore from separate and distinct ore
bodies, rather than from a single ore body.
The relative importance of each factor is considered by local
management to determine whether the stripping costs should be
attributed to the individual pit or to the combined output from
several pits.
Developmental stripping costs contribute to the future economic
benefits of mining operations when the production begins and
so are capitalized as tangible assets (construction in progress),
whereas production stripping is a part of on-going activities and
commences when the production stage of mining operations
begins and continues throughout the life of a mine.
Capitalization of developmental stripping costs ends when the
commercial production of the minerals commences.
Production stripping costs are incurred to extract the ore in the
form of inventories and/or to improve access to an additional
component of an ore body or deeper levels of material.
Production stripping costs are accounted for as inventories to
the extent the benefit from production stripping activity is
realized in the form of inventories. Production stripping costs are
recognized as a non-current asset (“stripping activity assets”) to
the extent it is probable that future economic benefit in terms of
improved access to ore will flow to the Company, the
components of the ore body for which access has been
improved can be identified and the costs relating to the stripping
activity associated with that component can be measured
reliably.
All stripping costs assets (either stripping activity assets or
capitalized developmental stripping costs) are presented within
a specific “mining assets” class of property, plant and equipment
and then depreciated on a units-of-production basis.
Exploration and evaluation expenditure
Exploration and evaluation activities involve the search for iron
ore and coal resources, the determination of technical feasibility
and the assessment of commercial viability of an identified
resource. Exploration and evaluation activities include:
•
researching and analyzing historical exploration data;
240
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
•
conducting topographical, geological, geochemical and
geophysical studies;
•
carrying out exploratory drilling, trenching and sampling
activities;
•
drilling, trenching and sampling activities to determine
the quantity and grade of the deposit;
•
examining and testing extraction methods and
metallurgical or treatment processes; and
•
detailed economic feasibility evaluations to determine
whether development of the reserves is commercially
justified and to plan methods for mine development.
Exploration and evaluation expenditure is charged to the
consolidated statements of operations as incurred except in the
following circumstances, in which case the expenditure is
capitalized: (i) the exploration and evaluation activity is within an
area of interest which was previously acquired in a business
combination and measured at fair value on acquisition; or (ii)
when management has a high degree of confidence in the
project’s economic viability and it is probable that future
economic benefits will flow to the Company.
Capitalized exploration and evaluation expenditures are
generally recorded as a component of property, plant and
equipment at cost less impairment charges, unless their nature
requires them to be recorded as an intangible asset. As the
asset is not available for use, it is not depreciated and all
capitalized exploration and evaluation expenditure is monitored
for indications of impairment. To the extent that capitalized
expenditure is not expected to be recovered, it is recognized as
an expense in the consolidated statements of operations.
Cash flows associated with exploration and evaluation
expenditure are classified as operating activities when they are
related to expenses or as an investing activity when they are
related to a capitalized asset in the consolidated statements of
cash flows.
Development expenditure
Development is the establishment of access to the mineral
reserve and other preparations for commercial production.
Development activities often continue during production and
include:
•
sinking shafts and underground drifts (often called
mine development);
•
making permanent excavations;
•
developing passageways and rooms or galleries;
•
building roads and tunnels; and
•
advance removal of overburden and waste rock.
Development (or construction) also includes the installation of
infrastructure (e.g., roads, utilities and housing), machinery,
equipment and facilities.
When reserves are determined and development is approved,
expenditures capitalized as exploration and evaluation are
reclassified as construction in progress and are reported as a
component of property, plant and equipment. All subsequent
development expenditures are capitalized and classified as
construction in progress. On completion of development, all
assets included in construction in progress are individually
reclassified to the appropriate category of property, plant and
Biological assets are part of the Brazil operating segment and
consist of eucalyptus forests located in the Brazilian state of
Minas Gerais exclusively from renewable plantations and
intended for the production of charcoal to be utilized as fuel and
a source of carbon in the direct reduction process of pig iron
production in some of the Company’s blast furnaces in Brazil.
Biological assets are measured at their fair value, net of
estimated costs to sell at the time of harvest. The fair value
(Level 3 in the fair value hierarchy) is determined based on the
discounted cash flow method, taking into consideration the cubic
volume of wood, segregated by plantation year, and the
equivalent sales value of standing trees. The average sales
price was estimated based on domestic market prices. In
determining the fair value of biological assets, a discounted
Borrowing costs directly attributable to the acquisition,
construction or production of a qualifying asset are part of the
cost of the asset until such assets are commissioned. If the
project is subject to a specific funding, the capitalization of
borrowing costs is based on the borrowing rate. If the project is
financed by the Company's debt, the capitalization of borrowing
costs is based on the weighted average borrowing cost for the
period.
241
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
|
Land,
buildings and
Improvements
|
Machinery,
equipment
and other
2
|
Construction
in progress
|
Right-of-use
assets
|
Mining
Assets
|
Total
|
|||||
|
Cost
|
|
|
|
|
|
||||||
|
At December 31, 2022
|
|
|
|
|
|
|
|||||
|
Additions
|
|
|
|
|
|
|
|||||
|
Acquisitions through business combinations (note
2.2.4)
|
|
|
|
|
|
|
|||||
|
Foreign exchange differences
|
|
|
|
|
|
|
|||||
|
Disposals
|
(
|
(
|
(
|
|
(
|
(
|
|||||
|
Divestments (note 2.3.1)
|
(
|
(
|
(
|
|
(
|
(
|
|||||
|
Other movements
1
|
|
|
(
|
(
|
|
(
|
|||||
|
At December 31, 2023
|
|
|
|
|
|
|
|||||
|
Additions
|
|
|
|
|
|
|
|||||
|
Acquisitions through business combinations (note
2.2.4)
|
|
|
|
|
|
|
|||||
|
Foreign exchange differences
|
(
|
(
|
(
|
(
|
(
|
(
|
|||||
|
Disposals
|
(
|
(
|
(
|
|
|
(
|
|||||
|
Other movements
1
|
|
|
(
|
(
|
|
|
|||||
|
At December 31, 2024
|
|
|
|
|
|
|
|||||
|
Accumulated depreciation and impairment
|
|||||||||||
|
At December 31, 2022
|
|
|
|
|
|
|
|||||
|
Depreciation charge for the year
|
|
|
|
|
|
|
|||||
|
Impairment (note 5.3)
|
|
|
|
|
|
|
|||||
|
Disposals
|
(
|
(
|
|
|
(
|
(
|
|||||
|
Foreign exchange differences
|
|
|
(
|
|
|
|
|||||
|
Divestments (note 2.3.1)
|
(
|
(
|
(
|
|
(
|
(
|
|||||
|
Other movements
1
|
|
(
|
(
|
(
|
|
(
|
|||||
|
At December 31, 2023
|
|
|
|
|
|
|
|||||
|
Depreciation charge for the year
|
|
|
|
|
|
|
|||||
|
Impairment (note 5.3)
|
|
|
|
|
|
|
|||||
|
Disposals
|
(
|
(
|
|
|
|
(
|
|||||
|
Foreign exchange differences
|
(
|
(
|
(
|
(
|
(
|
(
|
|||||
|
Other movements
1
|
|
|
(
|
(
|
|
(
|
|||||
|
At December 31, 2024
|
|
|
|
|
|
|
|||||
|
Carrying amount
|
|||||||||||
|
At December 31, 2023
|
|
|
|
|
|
|
|||||
|
At December 31, 2024
|
|
|
|
|
|
|
|||||
1.
Other movements predominantly represent transfers from construction in progress to other categories and retirement of fully depreciated assets and capitalization of
borrowing costs.
2.
Machinery, equipment and other includes biological assets of
74
and
64
as of
December 31, 2024
and 2023, respectively, and bearer plants of
47
and
51
as of
December 31, 2024
and 2023, respectively.
In 2024, capital expenditures relating to decarbonization
projects amounted to
0.3
billion and related mainly to the
Europe reportable segment. In 2023, they amounted to
0.2
billion mainly with respect to the ArcelorMittal Dofasco (Canada)
DRI/EAF project.
Assets pledged as security
See note 9.4 for information about assets pledged as security by
the Company.
Capital commitments
See note 9.4 for information about contractual commitments for
acquisition of property, plant and equipment by the Company.
Other information
The carrying amount of temporarily idle property, plant and
equipment at
December 31, 2024
and 2023 was
286
and
264
242
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
including mainly
30
and
41
in Brazil,
164
and
112
in the Europe
segment and
87
and
105
in Others, respectively.
The carrying amount of property, plant and equipment retired
from active use and not classified as held for sale was
1
and
22
at
December 31, 2024
and 2023
, respectively. Such assets are
carried at their recoverable amount.
In 2024, the Company capitalized
0.2
billion of borrowing costs
and applied a
5.1
%
capitalization rate.
tangible assets
I
mpairment charges were as follows:
|
|
Year ended December 31,
|
|||||
|
Type of asset
|
2024
|
2023
|
2022
|
|||
|
Goodwill
|
|
|
|
|||
|
Intangible assets
|
|
|
|
|||
|
Tangible assets
|
|
|
|
|||
|
Total
|
|
|
|
|||
Impairment test of goodwill
Goodwill is tested for impairment annually, as of October 1 or
whenever changes in circumstances indicate that the carrying
amount may not be recoverable at the level of the cash-
generating unit ("CGU") (in the case of AMKR) or group of cash-
generating unit ("GCGU") which corresponds either to AMSA or
the operating segments representing the lowest level at which
goodwill is monitored for internal management purposes.
Whenever the CGUs comprising the operating segments or
AMSA are tested for impairment at the same time as goodwill,
the cash-generating units are tested first and any impairment of
the assets is recorded prior to the testing of goodwill.
The recoverable amounts
of the GCGUs are mainly determined
based on their value in use. The value in use of each GCGU is
determined by estimating future cash flows. The
2024
impairment test of goodwill did not include the GCGU
corresponding to the Mining segment as goodwill allocated to
this GCGU was fully impaired in 2015.
The key assumptions for
the value in use calculations are primarily the discount rate
s,
growth rates, expected changes to average selling prices,
shipments and direct costs during the period. Assumptions for
average selling prices and shipments are based on historical
experience and expectations of future changes in the market. In
addition, with respect to raw material price assumptions, the
Company applied a range of $
80
per tonne to $
98
per tonne for
iron ore ($
70
per tonne to $
114
per tonne in 2023) and $
190
per
tonne to $
210
per tonne ($
185
per tonne to $
250
per tonne in
2023)
for coking coal. Cash flow forecasts adjusted for the risks
specific
to the tested assets are derived from the most recent
financial plans approved by management for the next five years.
Beyond the specifically forecasted period, the Company
extrapolates cash flows for the remaining years based on an
estimated growth rate of
2
%
. This rate does not exceed the
average long-term growth rate for the relevant markets.
The Company considered its exposure to certain climate-related
risks which could affect its estimates of future cash flow
projections applied for the determination of the recoverable
amount of its GCGUs and CGUs. With the switch to electric
vehicles and the move to wind and solar power generation, the
Company sees also additional opportunities as customers
deepen their understanding of embedded and lifecycle
emissions of the materials where steel compares favorably.
The Company is committed to the objectives of the Paris
agreement and announced its ambition to achieve group-wide
carbon neutrality by 2050. These announced goals will require
significant long-term investments which require global level
playing field, access to abundant and affordable clean energy,
facilitating necessary energy infrastructure, access to
sustainable finance for low-emissions steelmaking and
accelerated transition to a circular economy. In addition, the
Company considered the legal obligation of carbon neutrality by
2050 effective within the EU and in Canada following adoption
of the Climate Law and the Net Zero Emission Accountability
Act, respectively. Accordingly, with respect to its flat steel
operations in the EU and in Canada, ArcelorMittal concluded
that future decarbonization capital expenditures, which
correspond essentially to the construction of DRI-EAF facilities,
are necessary to maintain the level of economic benefits
expected to arise from the assets in their current condition and
should therefore be included in the Company’s assumptions for
future cash flows of the recoverable amount of the respective
GCGUs and CGUs
.
At the same time, the Company is engaged
in developing in the near to medium term a range of innovative
low-emission technologies for the transition to decarbonized
steel and required investments are considered in the Company's
future cash flow projections. ArcelorMittal acknowledges that
CGUs and GCGUs applying the BF-BOF route in other
jurisdictions than the EU and Canada will apply decarbonization
at a different pace. They may also not yet be subject to a legal
obligation of carbon neutrality, as a result of which
the future
estimated decarbonization cost for such operations is reflected
through an additional risk premium embedded in discount rates
until they are able to accelerate their decarbonization strategy to
meet the 2050 carbon neutrality objective and a legal obligation
arises in the relevant jurisdiction.
ArcelorMittal's most substantial climate-related policy risk is the
EU Emissions Trading scheme ("'ETS"), which applies to all its
European plants. The risk concerns the Company's primary
steelmaking plants which are exposed to this regulation. On
April 25, 2023, the EU adopted a revision of the ETS Directive
243
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
including a regulation establishing a carbon border adjustment
mechanism (“CBAM”) which entered into force on May 17, 2023.
The ETS and CBAM regulations will impact the carbon
emissions allowances from the second trading period of Phase
IV (2026-2030) onwards as they will be gradually phased out
(
2.5
%
by 2026,
5
%
by 2027,
10
%
by 2028,
22.5
%
by 2029,
and
100
%
by 2034). The Company’s assumptions for future
cash flows include an estimate for costs that the Company
expects to incur to acquire emission allowances, which primarily
impacts the flat steel operations in the EU under the ETS
scheme and in Canada. The assumption for carbon emission
cost is based on historical experience, implementation of
decarbonization strategies to mitigate or otherwise offset such
future costs and information available of future regulatory or
operational changes. With respect to the EU ETS scheme, the
assumption for carbon emission cost includes also the gradual
phasing out of free emission allowances and the forecast market
price of emission rights, for which the Company considered in its
respectively.
The assumptions used in the value in use calculations are
inherently uncertain and require management judgment as
described in note 1.3. The Company's process includes specific
consideration given to the most recent short, medium and long-
term price forecasts and discount rates consistent with external
information, expected production and shipment volumes and
updated development plans, operating costs and capital
expenditure plans. 2024 was characterized by
wea
k demand in
particular in Europe. The impact was exacerbated by high
exports from China and excess production relative to demand
resulted in very low domestic steel spreads. Whilst near-term
demand remains subdued, inventory levels are low, especially in
Europe; the Company expects however that restocking activity
will supplement real demand improvement in time.
Management estimates discount rates using pre-tax rates that
reflect current market rates for investments of similar risk. The
rate for each CGU, including beta, cost of debt and capital
structure was estimated from the weighted average cost of
capital of producers, which operate a portfolio of assets similar
to those of the Company’s assets and CGU specific country risk
premiums were applied. Prior to January 1, 2024, the
Company's goodwill impairment testing was performed on the
basis of
five
operating and reportable segments (see notes 5.1.
and 3.1).
T
he weighted average pre-tax discount rates used in
connection with the historical goodwill impairment testing in
2023 and based on the revised operating and reportable
segments, GCGUs and CGUs to which goodwill is allocated in
2024 are set forth below
:
|
|
North
America
|
Brazil
|
Europe
|
Sustainable
Solutions
|
AMSA
|
AMKR
1
|
||||||
|
GCGU weighted average pre-tax discount rate used in 2024 (in %)
|
|
|
|
|
|
|
||||||
|
GCGU weighted average pre-tax discount rate used in 2023 (in %)
|
|
|
|
|
|
|
||||||
|
1
Rates for AMKR are blended and include distinct country risk premiums reflecting differentiated pre-war and post-war conditions.
|
||||||||||||
244
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
Once recognized, impairment losses for goodwill are not
reversed.
There were
no
impairment charges recognized with respect to
goodwill following the Company’s impairment tests as of
October 1, 2024
and October 1, 202
3. In 2023, in connection
with the sale of ArcelorMittal Temirtau, the Company recognized
a
194
impairm
ent loss relating to a portion of the former ACIS
segment goodwill allocated to the disposal group in proportion of
the total sale consideration to the recoverable amount of the
remaining former ACIS operations in Ukraine and South Africa.
The total value in use calculated for all GCGUs increased
overall in
2024
as compared to
2023
primarily as a result of
higher cash flow projections in North America.
In validating the value in use determined for the GCGUs, the
Company performed a sensitivity analysis of key assumptions
used in the discounted cash-flow model (such as discount rates,
average selling prices and shipments) and believes that
reasonably possible changes in key assumptions could cause
an impairment loss to be recognized in respect of AMSA GCGU
and AMKR CGU. Following the announcement of the wind down
of long steel operations (see below), AMSA's operations
encompass flat steel operations at the Vanderbijlpark site
supported by a metallurgical by-products division. Sales are
mainly domestic but they are exposed to international steel
prices which are volatile, reflecting the cyclical nature of the
global steel industry, developments in particular steel consuming
industries and macroeconomic trends of emerging markets,
such as economic growth. The Company believes that sales
volumes, prices and discount rates are the key assumptions
most sensitive to change. See also note 1.3 for AMKR. The
AMSA and AMKR value in use models anticipate higher sales
volumes in 2025 as compared to 2024 (
1.4
million tonnes for the
year ended December 31, 2024) and in 2026 as compared to
2024 (
1.5
million tonnes for the year ended December 31,
2024
), respectively, followed by a relative stability thereafter.
Average selling prices are expected to remain stable during the
explicit years for both facilities.
The following changes in key assumptions in projected earnings
in every year of initial
5
-year
period and perpetuity of AMSA's
and AMKR's operations, assuming unchanged values for the
other assumptions,
would cause the recoverable amount to
equal the carrying amount:
|
AMSA
|
AMKR
|
|
|
Excess of recoverable amount over carrying
amount
|
|
|
|
Increase in pre-tax discount rate (change in
basis points)
|
|
|
|
Decrease in average selling price (change in %)
|
|
|
|
Decrease in shipments (change in %)
|
|
|
Impairment test of property, plant and equipment and
intangibles (excluding goodwill)
amounts of its intangible assets (excluding goodwill) and
tangible assets to determine whether there is any indication that
the carrying amount of those assets may not be recoverable
through continuing
use, or that a reversal of previous periods'
impairment charges may be required
. If any such indication
exists, the recoverable amount of the asset (or CGU) is
reviewed in order to determine the amount of the
impairment (or
reversal of prior periods' impairment charges)
, if any. The
recoverable amount is the higher of its fair value less cost of
disposal and its value in use.
In estimating its value in use, the estimated future cash flows
are discounted to their present value using a pre-tax discount
rate that reflects current market assessments of the time value
of money and the risks specific to the asset (or cash-generating
unit). For an asset that does not generate cash inflows largely
independent of those from other assets, the recoverable amount
is determined for the CGU to which the asset belongs. The CGU
is the smallest identifiable group of assets corresponding to
operating units that generate cash inflows. If the recoverable
amount of an asset (or CGU) is estimated to be less than its
carrying amount, an impairment loss is recognized. An
impairment loss is recognized as an expense immediately as
part of cost of sales (see note 4.2) in the consolidated
statements of operations.
In the case of permanently idled assets, the impairment is
measured at the individual asset level. Otherwise, the
Company’s assets are measured for impairment at the CGU
level. In certain instances, the CGU is an integrated
manufacturing facility which may also be an operating
subsidiary. Further, a manufacturing facility may be operated in
concert with another facility with neither facility generating cash
inflows that are largely independent from the cash inflows of the
other. In this instance, the
two
facilities are combined for
purposes of testing for impairment. As of
December 31, 2024
and December 31, 2023, the Company determined it ha
s
45
and
An impairment loss, related to intangible assets other than
goodwill and tangible assets recognized in prior years is
reversed if, and only if, there has been a change in the
estimates used to determine the asset’s recoverable amount
since the last impairment loss was recognized. However, the
increased carrying amount of an asset due to a reversal of an
impairment loss will not exceed the carrying amount that would
have been determined (net of amortization or depreciation) had
no impairment loss been recognized for the asset in prior years.
A reversal of an impairment loss is recognized immediately as
part of operating income in the consolidated statements of
245
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
Impairment charges and reversals relating to property, plant and
equipment and intangibles (excluding goodwill) were as follows
for the years ended
December 31, 2024
,
2023
and
2022
:
2024
In 2024, the Company recognized a
37
impairment charge of
property, plant and equipment with respect to its Longs
Business in South Africa, which will be placed into care and
maintenance subject to a consultation process, following the
announcement of its wind down on January
6
, 2025. The wind-
down was postponed for
one
additional month as discussions
continue regarding potential governmental support. On February
28, 2025, ArcelorMittal South Africa announced that it will
implement the final wind down of the Longs Business. It is
envisaged that the shutdown of the blast furnaces will
commence in the first week of March, with the last steel
produced in late-March or early-April 2025. The final wind down
into care and maintenance will be fully implemented in the
second quarter of 2025.
ArcelorMittal also recognized a
43
impairment charge of
property, plant and equipment for assets measured at fair value
less cost of disposal following the termination of the Monlevade
expansion project in Brazil.
In addition, the Company recognized a
36
impairment charge of
property, plant and equipment in connection with the definitive
closure of the Kraków coke plant in Poland which was
announced on July 19, 2024.
The Company reviewed impairment reversal indicators on
assets previously impaired. It concluded that there was a
significant change with a positive effect resulting in an
impairment reversal indicator with respect to its iron ore
expansion project in Liberia, which was restarted in 2021 and for
which the first concentrate was produced in the fourth quarter of
2024 with full
20
million tonnes capacity expected by the end of
2025.
The Company performed a value in use calculation as
well as a sensitivity analysis and, in addition to the fact that the
project is not yet fully operational, it concluded that no
impairment reversal should be recognized in relation to the
intangible assets recognized in 2015. The Company did not
identify indicator of impairment reversal for any other assets.
The following changes in key assumptions in projected earnings
of AML throughout the life of mine, assuming unchanged values
for the other assumptions, would cause the recoverable amount
to equal the carrying amount at December 31, 2024:
|
AML
|
|
|
Excess of recoverable amount over carrying amount
|
|
|
Increase in pre-tax discount rate (change in basis points)
|
|
|
Decrease in average selling price (change in %)
|
|
|
Decrease in shipments (change in %)
|
|
2023
In 2023, ArcelorMittal recognized a
732
impairment charge
related to property, plant and equipment with respect to the sale
on December 7, 2023 of its Kazakhstan operations in the former
ACIS segment
to Qazaqstan Investment Corporation, a state-
controlled direct investment fund.
The impairment loss resulted
from the adjustment of the carrying amount of the disposal
group to the net sales proceeds of
278
(see note 2.3).
On November 28, 2023, AMSA announced that it contemplates
the wind down of its Longs Business subject to a due diligence
and a consultative process involving key customers, suppliers,
organized labour, and other stakeholders. The Company
assessed the recoverable amount of its Longs Business in
South Africa based on a value in use calculation and recognized
accordingly a
112
impairment charge of property, plant and
equipment.
|
Cash Generating Unit
|
Region
|
Recoverable
Amount (Value
in Use)
|
Total
Impairment
Recorded
|
2023 Pre-Tax
Discount Rate
|
2022 Pre-Tax
Discount Rate
|
Carrying Amount of
property, plant and
equipment as of
December 31, 2023
|
|||||||
|
Long Products South Africa
|
South Africa
|
|
|
|
|
|
2022
In 2022, the Company recognized a
1,026
impairment charge
related to property, plant and equipment (
1,020
) and intangibles
(
6
) with respect to AMKR (Ukraine) as a result of the ongoing
conflict in Russia, which resulted in low level of production,
sales and net income and created significant uncertainty about
the timing and ability of operations to return to a normal level of
activity. Adverse geopolitical conditions, which resulted in a
substantial increase in the discount rate applied by the
Company in its recoverable amount (value in use) calculation,
deteriorated further during the fourth quarter of 2022 following
attacks against Ukrainian power infrastructures causing
additional operational issues for AMKR and the concerns about
an intensification of the conflict in connection with the
announcements of delivery of heavy military equipment by
western countries. The Company applied separate discount
rates over the discrete projections period, including a higher
country risk premium for 2023 cash flow projections and a return
to pre-war country risk premium in the course of 2024 and for
246
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
the terminal value calculation as value in use is sensitive to a
difference in country risk for different periods.
|
Cash-Generating Unit
|
Region
|
Recoverable
Amount
(Value in Use)
|
Total
Impairment
Recorded
|
2022 Pre-Tax Discount Rates
|
2021 Pre-Tax
Discount Rate
|
Carrying amount of
property, plant and
equipment as of
December 31, 2022
|
|||||||||
|
Applied to
2023
projections
|
Applied to
subsequent
projections
|
||||||||||||||
|
AMKR
|
Ukraine
|
|
|
|
|
|
|
||||||||
Financial assets and liabilities mainly comprise:
•
gross debt (see note 6.1.2)
•
cash and cash equivalents, restricted cash and reconciliations of cash flows (see note 6.1.3)
•
net debt (see note 6.1.4)
•
derivative financial instruments (see note 6.1.5)
The estimated fair values of certain financial instruments have
been determined using available market information or other
valuation methodologies that require judgment in interpreting
market data and developing estimates.
The following table
summarizes assets and liabilities based on their categories at
December 31, 2024
:
247
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
|
December 31, 2024
|
||||||||||
|
|
Carrying
amount in
the
consolidated
statements
of financial
position
|
Non-
financial
assets and
liabilities
|
Assets /
Liabilities at
amortized
cost
|
Fair value
recognized
in profit or
loss
|
Fair value
recognized
in OCI
|
Derivatives
|
|||||
|
ASSETS
|
|||||||||||
|
Current assets:
|
|||||||||||
|
Cash and cash equivalents
|
|
|
|
|
|
|
|||||
|
Restricted cash
|
|
|
|
|
|
|
|||||
|
Trade accounts receivable and other
|
|
|
|
|
|
|
|||||
|
Inventories
|
|
|
|
|
|
|
|||||
|
Prepaid expenses and other current assets
|
|
|
|
|
|
|
|||||
|
Total current assets
|
|
|
|
|
|
|
|||||
|
Non-current assets:
|
|
|
|
|
|
|
|||||
|
Goodwill and intangible assets
|
|
|
|
|
|
|
|||||
|
Property, plant and equipment and biological assets
|
|
|
|
|
|
|
|||||
|
Investments in associates and joint ventures
|
|
|
|
|
|
|
|||||
|
Other investments
|
|
|
|
|
|
|
|||||
|
Deferred tax assets
|
|
|
|
|
|
|
|||||
|
Other assets
|
|
|
|
|
|
|
|||||
|
Total non-current assets
|
|
|
|
|
|
|
|||||
|
Total assets
|
|
|
|
|
|
|
|||||
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|||||
|
Current liabilities:
|
|
|
|
|
|
|
|||||
|
Short-term debt and current portion of long-term debt
|
|
|
|
|
—
|
|
|||||
|
Trade accounts payable and other
|
|
|
|
|
—
|
|
|||||
|
Short-term provisions
|
|
|
|
|
—
|
|
|||||
|
Accrued expenses and other liabilities
|
|
|
|
|
—
|
|
|||||
|
Income tax liabilities
|
|
|
|
|
—
|
|
|||||
|
Total current liabilities
|
|
|
|
|
—
|
|
|||||
|
Non-current liabilities:
|
|
|
|
|
|
|
|||||
|
Long-term debt, net of current portion
|
|
|
|
|
—
|
|
|||||
|
Deferred tax liabilities
|
|
|
|
|
—
|
|
|||||
|
Deferred employee benefits
|
|
|
|
|
—
|
|
|||||
|
Long-term provisions
|
|
|
|
|
—
|
|
|||||
|
Other long-term obligations
|
|
|
|
|
—
|
|
|||||
|
Total non-current liabilities
|
|
|
|
|
—
|
|
|||||
|
Equity:
|
|
|
|
|
|
|
|||||
|
Equity attributable to the equity holders of the parent
|
|
|
—
|
—
|
—
|
—
|
|||||
|
Non-controlling interests
|
|
|
—
|
—
|
—
|
—
|
|||||
|
Total equity
|
|
|
—
|
—
|
—
|
—
|
|||||
|
Total liabilities and equity
|
|
|
|
—
|
—
|
|
|||||
248
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
|
December 31, 2023
|
||||||||||
|
|
Carrying amount
in the
consolidated
statements of
financial position
|
Non-financial
assets and
liabilities
|
Assets /
Liabilities at
amortized
cost
|
Fair value
recognized in
profit or loss
|
Fair value
recognized
in OCI
|
Derivatives
|
|||||
|
ASSETS
|
|||||||||||
|
Current assets:
|
|||||||||||
|
Cash and cash equivalents
|
|
|
|
|
|
|
|||||
|
Restricted cash
|
|
|
|
|
|
|
|||||
|
Trade accounts receivable and other
|
|
|
|
|
|
|
|||||
|
Inventories
|
|
|
|
|
|
|
|||||
|
Prepaid expenses and other current assets
|
|
|
|
|
|
|
|||||
|
Total current assets
|
|
|
|
|
|
|
|||||
|
Non-current assets:
|
|
|
|
|
|
|
|||||
|
Goodwill and intangible assets
|
|
|
|
|
|
|
|||||
|
Property, plant and equipment and biological assets
|
|
|
|
|
|
|
|||||
|
Investments in associates and joint ventures
|
|
|
|
|
|
|
|||||
|
Other investments
|
|
|
|
|
|
|
|||||
|
Deferred tax assets
|
|
|
|
|
|
|
|||||
|
Other assets
|
|
|
|
|
|
|
|||||
|
Total non-current assets
|
|
|
|
|
|
|
|||||
|
Total assets
|
|
|
|
|
|
|
|||||
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|||||
|
Current liabilities:
|
|
|
|
|
|
|
|||||
|
Short-term debt and current portion of long-term debt
|
|
|
|
|
—
|
|
|||||
|
Trade accounts payable and other
|
|
|
|
|
—
|
|
|||||
|
Short-term provisions
|
|
|
|
|
—
|
|
|||||
|
Accrued expenses and other liabilities
|
|
|
|
|
—
|
|
|||||
|
Income tax liabilities
|
|
|
|
|
—
|
|
|||||
|
Total current liabilities
|
|
|
|
|
—
|
|
|||||
|
Non-current liabilities:
|
|
|
|
|
|
|
|||||
|
Long-term debt, net of current portion
|
|
|
|
|
—
|
|
|||||
|
Deferred tax liabilities
|
|
|
|
|
—
|
|
|||||
|
Deferred employee benefits
|
|
|
|
|
—
|
|
|||||
|
Long-term provisions
|
|
|
|
|
—
|
|
|||||
|
Other long-term obligations
|
|
|
|
|
—
|
|
|||||
|
Total non-current liabilities
|
|
|
|
|
—
|
|
|||||
|
Equity:
|
|
|
|
|
|
||||||
|
Equity attributable to the equity holders of the parent
|
|
|
—
|
—
|
—
|
—
|
|||||
|
Non-controlling interests
|
|
|
—
|
—
|
—
|
—
|
|||||
|
Total equity
|
|
|
—
|
—
|
—
|
—
|
|||||
|
Total liabilities and equity
|
|
|
|
—
|
—
|
|
|||||
249
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
assets and liabilities at their fair value. Assets and liabilities
carried or measured at fair value have been classified into three
levels based upon a fair value hierarchy that reflects the
significance of the inputs used in making the measurements.
The levels are as follows:
Level 1: Quoted prices in active markets for identical assets or
liabilities that the entity can access at the measurement date;
Level 2: Significant inputs other than within Level 1 that are
observable for the asset or liability, either directly (i.e.: as prices)
or indirectly (i.e.: derived from prices);
Level 3: Inputs for the assets or liabilities that are not based on
observable market data and require management assumptions
certain financial assets and financial liabilities at their fair value
on recurring basis.
|
As of December 31, 2024
|
|
|
|
|
||||
|
|
Level 1
|
Level 2
|
Level 3
|
Total
|
||||
|
Assets at fair value:
|
|
|
|
|
||||
|
Investments in equity instruments at FVOCI
|
|
|
|
|
||||
|
Trade accounts receivable and other subject to TSR programs*
|
|
|
|
|
||||
|
Derivative financial current assets
|
|
|
|
|
||||
|
Derivative financial non-current assets
|
|
|
|
|
||||
|
Total assets at fair value
|
|
|
|
|
||||
|
Liabilities at fair value:
|
|
|
|
|
||||
|
Derivative financial current liabilities
|
|
|
|
|
||||
|
Derivative financial non-current liabilities
|
|
|
|
|
||||
|
Total liabilities at fair value
|
|
|
|
|
*The fair value of TSR program receivables equals carrying amount due to the short time frame between the initial recognition and time of sale.
|
As of December 31, 2023
|
|
|
|
|
||||
|
|
Level 1
|
Level 2
|
Level 3
|
Total
|
||||
|
Assets at fair value:
|
|
|
|
|
||||
|
Investments in equity instruments at FVOCI
|
|
|
|
|
||||
|
Trade accounts receivable and other subject to TSR programs*
|
|
|
|
|
||||
|
Derivative financial current assets
|
|
|
|
|
||||
|
Derivative financial non-current assets
|
|
|
|
|
||||
|
Total assets at fair value
|
|
|
|
|
||||
|
Liabilities at fair value:
|
|
|
|
|
||||
|
Derivative financial current liabilities
|
|
|
|
|
||||
|
Derivative financial non-current liabilities
|
|
|
|
|
||||
|
Total liabilities at fair value
|
|
|
|
|
*The fair value of TSR program receivables equals carrying amount due to the short time frame between the initial recognition and time of sale.
refer to listed securities quoted in active markets (see note 2.5).
A quoted market price in an active market provides the most
reliable evidence of fair value and is used without adjustment to
measure fair value whenever available, with limited exceptions.
The total fair value is either the price of the most recent trade at
the time of the market close or the official close price as defined
by the exchange on which the asset is most actively traded on
the last trading day of the period, multiplied by the number of
units held without
consideration
of transaction costs.
Derivative financial assets and liabilities classified as Level 2
refer to instruments to hedge fluctuations in interest rates,
foreign exchange rates, raw materials (base metals), freight,
energy and emission rights, see note 6.1.5 for further
information.
250
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
Derivative financial assets and liabilities classified as Level 3 are
6.1.2 Gross debt
obligations and is stated at amortized cost.
6.1.2.1 Short-term debt
consisted of the following:
|
December 31,
|
|||
|
2024
|
2023
|
||
|
Short-term bank loans and other
credit facilities including
commercial paper
1
|
|
|
|
|
Current portion of long-term debt
|
|
|
|
|
Lease obligations
2
|
|
|
|
|
Total
|
|
|
|
1.
The weighted average interest rate on short-term borrowings outstanding was
2.
See note 7.
Short-term bank loans and other credit facilities include short-
term loans, overdrafts and commercial paper.
ArcelorMittal has entered into certain short-term committed
bilateral credit facilities renewable on an annual basis. As of
December 31, 2024
, facilities totaling approximately
0.6
billion
,
remained fully available.
Commercial paper
The Company has a commercial paper program enabling
borrowings of up to
€
1.5
billion
. As of
December 31, 2024
and
2023
, the outstanding amount was
745
and
684
, respectively.
251
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
6.1.2.2 Long-term debt
|
December 31,
|
|||||||||
|
2024
|
2023
|
||||||||
|
Year of maturity
|
Type of Interest
|
Interest rate
1
|
Carrying amount at amortized cost
|
||||||
|
Corporate
|
|||||||||
|
|
2029
|
Floating
|
—
|
|
|
||||
|
€
|
2024
|
Fixed
|
|
|
|
||||
|
|
2024
|
Fixed
|
|
|
|
||||
|
|
2025
|
Fixed
|
|
|
|
||||
|
€
|
2025
|
Fixed
|
|
|
|
||||
|
|
2026
|
Fixed
|
|
|
|
||||
|
€
|
2026
|
Fixed
|
|
|
|
||||
|
|
2027
|
Fixed
|
|
|
|
||||
|
€
|
2028
|
Fixed
|
|
|
|
||||
|
|
2029
|
Fixed
|
|
|
|
||||
|
€
|
2031
|
Fixed
|
|
|
|
||||
|
|
2032
|
Fixed
|
|
|
|
||||
|
|
2034
|
Fixed
|
|
|
|
||||
|
|
2039
|
Fixed
|
|
|
|
||||
|
|
2041
|
Fixed
|
|
|
|
||||
|
|
2054
|
Fixed
|
|
|
|
||||
|
EIB loan
|
2025
|
Fixed
|
|
|
|
||||
|
EIB loan
|
2025-2032
|
Floating
|
|
|
|
||||
|
Schuldschein loans
|
2025-2027
|
Fixed
|
|
|
|
||||
|
Schuldschein loans
|
2025-2027
|
Floating
|
|
|
|
||||
|
Other loans
|
2025-2035
|
Floating
|
|
|
|
||||
|
Total Corporate
|
|
|
|||||||
|
Subsidiaries
|
|||||||||
|
Other loans
|
|
|
|||||||
|
Total
|
|
|
|||||||
|
Less current portion of long-term debt
|
(
|
(
|
|||||||
|
Total long-term debt (excluding lease obligations)
|
|
|
|||||||
|
Long-term lease obligations
2
|
|
|
|||||||
|
Total long-term debt, net of current portion
|
|
|
|||||||
1.
Rates applicable to balances outstanding at
December 31, 2024
. For debt that has been redeemed in its entirety during
2024
, the interest rates refer to the rates at
repayment date.
2.
Net of current portion of
182
and
207
as of
December 31, 2024
and 2023, respectively. See note 7.
252
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
Corporate
On May 29, 2024, ArcelorMittal signed an agreement for a
5.5
billion revolving credit facility (the "Facility"). This Facility
replaced the
5.5
billion revolving credit facility dated December
19, 2018, which was amended and extended on April 27, 2021.
The agreement incorporated a single tranche of
5.5
billion
maturing on May 29, 2029, with
two
one
-year
extension options.
The Facility
contains restrictive covenants, which among other
things, limit encumbrances on the assets of ArcelorMittal and its
subsidiaries, the ability of ArcelorMittal’s subsidiaries to incur
debt and the ability of ArcelorMittal and its subsidiaries to
dispose of assets in certain circumstances.
The margin
applicable to ArcelorMittal’s principal credit facilities (the Facility
and certain other credit facilities) and the coupons on certain of
its outstanding bonds are subject to adjustment in the event of
certain changes in its long-term credit ratings. On June 16,
2023, Standard & Poor's upgraded ArcelorMittal's outlook to
positive and affirmed a long-term credit rating of 'BBB-'. On
February 19, 2024, Moody’s revised ArcelorMittal outlook to
'Positive' from 'Stable' on expected strengthening of its business
profile and structurally improving its profitability, and affirmed the
‘Baa3’ investment grade rating. The Facility may be used for
general corporate purposes and was fully available as of
December 31, 2024. The Company makes drawdowns from and
repayments on this Facility in the framework of its cash
management.
On September 30, 2010, ArcelorMittal entered into
500
revolving
multi-currency letter of credit facility (the "Letter of Credit
Facility"). The Letter of Credit Facility is used by the Company
and its subsidiaries for the issuance of letters of credit and other
instruments. The terms of the letters of credit and other
instruments contain certain restrictions as to duration.
The Letter
of Credit facility, whose amount and maturity have been revised
from time to time,
amounted to
395
prior to refinancing
through
a
445
Letter of Credit Facility entered into on July 31, 2024, with
maturity extended from July 31, 2024
to July 31, 2027 and with
Facility also includes an accordion clause which allows the
Company to invite lenders to increase their commitments up to
Bonds
On January 17, 2024, at maturity, ArcelorMittal fully repaid the
outstanding
€
529
million (
579
) of its €
1.0
billion Fixed Rate
Notes due 2024.
On June 17, 2024, ArcelorMittal issued
500
of
6.00
%
Notes due
June 17, 2034 and
500
of
6.35
%
Notes due June 17, 2054.
On July 16, 2024, at maturity, ArcelorMittal fully repaid the
outstanding
290
of its
750
Fixed Rate Notes due 2024.
On December 13, 2024, ArcelorMittal issued
€
500
million
(
519
)
of
3.125
%
Notes due December 13, 2028 and
€
500
million
(
519
) of
3.50
%
Notes due December 13, 2031. The Notes were
issued under ArcelorMittal's €
10
billion wholesale Euro Medium
Term Notes Program and the use of proceeds of the issuance
was general corporate purposes and refinancing of existing
indebtedness.
The margin applicable to ArcelorMittal’s principal credit facilities
facilities) and the coupons on certain of its outstanding bonds
are subject to adjustment in the event of a change in its long-
term credit ratings.
maturity, the original coupons and the current interest rates for
the bonds impacted by changes in the long-term credit rating:
|
Initial value
|
Nominal amount of
outstanding value
|
Date of issuance
|
Repayment date
|
Interest rate
1
|
Issued at
|
||||||
|
|
|
Jun 1, 2015
|
Jun 1, 2025
|
|
|
||||||
|
€
|
€
|
Nov 19, 2019
|
Nov 19, 2025
|
|
|
||||||
|
|
|
Mar 11, 2019
|
Mar 11, 2026
|
|
|
||||||
|
€
|
€
|
Sep 26, 2022
|
Sep 28, 2026
|
|
|
||||||
|
|
|
Nov 29, 2022
|
Nov 29, 2027
|
|
|
||||||
|
€
|
€
|
Dec 13, 2024
|
Dec 13, 2028
|
|
|
||||||
|
|
|
Jul 16, 2019
|
Jul 16, 2029
|
|
|
||||||
|
€
|
€
|
Dec 13, 2024
|
Dec 13, 2031
|
|
|
||||||
|
|
|
Nov 29, 2022
|
Nov 29, 2032
|
|
|
||||||
|
|
|
Jun 17, 2024
|
Jun 17, 2034
|
|
|
||||||
|
|
|
Oct 8, 2009
|
Oct 15, 2039
|
|
|
||||||
|
|
|
Aug 5, 2010
|
Oct 15, 2039
|
|
|
||||||
|
|
|
Mar 7, 2011
|
Mar 1, 2041
|
|
|
||||||
|
|
|
Jun 17, 2024
|
Jun 17, 2054
|
|
|
1.
Rate applicable at December 31, 2024.
253
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
European Investment Bank (“EIB”) Loan
On June 2, 2021, ArcelorMittal signed a
€
280
million
loan
agreement with the European Investment Bank ("EIB") for
funding of research, development and innovation projects in
Europe over the period of 2021-2023. This operation benefits
from a guarantee from the European Union under the European
Fund for Strategic Investments. On March 16, 2022 ArcelorMittal
draw down the facility in full. As of December 31, 2024,
€
262
million (
273
) was outstanding.
On December 16, 2016, ArcelorMittal signed a
€
350
million
finance contract with the EIB in order to finance European
research, development and innovation projects over the period
2017-2020 within the European Union, mainly in France,
Belgium, Spain, Poland and Luxembourg. This funding benefits
from a guarantee from the European Union under the European
Fund for Strategic Investments. As of
December 31, 2024
,
€
15
million
(
15
) was outstanding.
Other loans
On May 4, 2022, ArcelorMittal completed the offering of a
€
346.5
million
variable rate loan, a
€
24.5
million
fixed rate loan,
a
€
263
million
variable rate loan and a
€
66
million
fixed rate loan
in the German Schuldschein market. On May 6, 2022, the
Company further completed the offering of a
€
25
million
fixed
rate loan. The proceeds of these issuances were used for
general corporate purposes. As of December 31, 2024,
€
724
million (
753
) was outstanding.
On December 21, 2018, the Company entered into a facility
agreement with a group of lenders for
€
235
million
to finance the
construction of a new hot strip mill in Mexico. This facility
became effective upon issuance of a guarantee by the
Oesterreichische Kontrollbank AG in March 2019. The last
installment under this agreement is due
December 28, 2029
.
The outstanding amount in total as of December 31, 2024 was
€
97
million
(
101
).
Other loans relate to various debt with banks and public
institutions.
Americas
Other loans
Other loans relate mainly to loans contracted by ArcelorMittal
subsidiaries in
Mexico and Canada
with different counterparties.
Europe, Asia and Africa
On December 15, 2022, AMKR entered into a
100
loan
agreement with EBRD for working capital purposes. As of
December 31, 2024,
100
was drawn under the agreement.
On November 17, 2023, AMKR entered into a
150
loan
agreement with EBRD for working capital purposes.
80
were
committed and fully drawn as of December 31, 2024.
70
will be
committed by EBRD in 2025 upon AMKR's request.
On May 25, 2017, ArcelorMittal South Africa signed a
4.5
billion
South African rand revolving borrowing base finance facility
maturing on May 25, 2020. The facility was amended and
extended on July 26, 2019 with a maturity of July 26, 2022. On
August 23, 2021, the facility was further amended and restated
for an amount of
3.5
billion
South African rand and with a
maturity of September 3, 2024. On August 30, 2023, the facility
was further amended and restated for an amount of
4.5
billion
South African rand and with a maturity of September 7, 2026.
Any borrowings under the facility are secured by certain eligible
inventory and receivables, as well as certain other working
capital and related assets of ArcelorMittal South Africa. The
facility is used for general corporate purposes. The facility is not
guaranteed by ArcelorMittal. As of December 31, 2024,
2.7
billion
South African rand (
144
) was drawn.
The borrowing base
facility at ArcelorMittal South Africa remains subject to a financial
covenant as of December 31, 2024. Non-compliance with the
covenant would entitle the lenders under such facility to
accelerate repayment obligations.
On December 28, 2023, and on March 4, 2024, AM Green
Energy signed
two
INR
7.5
billion
(
175
) loans to finance the
development of its renewable energy project. As of December
31, 2024,
INR
15
billion
(
175
) was outstan
ding.
Other loans
Other loans mainly relate to loans contracted by ArcelorMittal
subsidiaries with different counterparties.
Hedge of net investments
As of
April 1, 2018
, the Company designated a portfolio of euro
denominated debt (
€
4,142
million
and €
3,627
million as of
December 31, 2024
and 2023, respectively) as a hedge of
certain euro denominated investments (
€
8,208
million
and
€
8,635
million
as of
December 31, 2024
and 2023, respectively)
in order to mitigate the foreign currency risk arising from certain
euro denominated subsidiaries' net assets. The risk arises from
the fluctuation in spot exchange rates between the U.S. dollar
and euro, which causes the amount of the net investments to
vary. The hedged risk in the hedge of net investments is a risk of
a weakening euro against the U.S. dollar that will result in a
reduction in the carrying amount of the Company's net
investments in the subsidiaries subject to the hedge. The euro
denominated debt is designated as a hedging instrument for the
change in the value of the net investments that is attributable to
changes in the euro/U.S. dollar spot rate.
To assess the hedge effectiveness, the Company determines
the economic relationship between the hedging instrument and
the hedged item by comparing changes in the carrying amount
of the debt portfolio that are attributable to a change in the spot
rate with changes in the net investments in the foreign
operations due to movements in the spot rate.
254
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
As of
December 31, 2024
and 2023, the Company recognized
respectively, arising on the translation of the euro denominated
debt designated as a hedge of the euro denominated net
investments in foreign operations in other comprehensive
income within the foreign exchange translation reserve.
Maturity profile
debt, long-term debt and long-term lease obligations, including
their current portion are as follows:
|
Year of maturity
|
Amount
|
|
|
2025
|
|
|
|
2026
|
|
|
|
2027
|
|
|
|
2028
|
|
|
|
2029
|
|
|
|
Subsequent years
|
|
|
|
Total
|
|
Fair value
estimate its debt at fair value. Fair value measurement has been
classified into three levels based upon a fair value hierarchy that
reflects the significance of the inputs used in making the
measurements.
|
As of December 31, 2024
|
Carrying amount
|
Fair Value
|
|||||||
|
Level 1
|
Level 2
|
Level 3
|
Total
|
||||||
|
Instruments payable bearing interest at fixed rates
|
|
|
|
|
|
||||
|
Instruments payable bearing interest at variable rates
|
|
|
|
|
|
||||
|
Total long-term debt, including current portion
|
|
|
|
|
|
||||
|
Short term bank loans and other credit facilities including
commercial paper
|
|
|
|
|
|
||||
|
As of December 31, 2023
|
Carrying amount
|
Fair Value
|
|||||||
|
Level 1
|
Level 2
|
Level 3
|
Total
|
||||||
|
Instruments payable bearing interest at fixed rates
|
|
|
|
|
|
||||
|
Instruments payable bearing interest at variable rates
|
|
|
|
|
|
||||
|
Total long-term debt, including current portion
|
|
|
|
|
|
||||
|
Short term bank loans and other credit facilities including
commercial paper
|
|
|
|
|
|
||||
Instruments payable classified as Level 1 refer to the
Company’s listed bonds quoted in active markets. The total fair
value is the official closing price as defined by the exchange on
which the instrument is most actively traded on the last trading
day of the period, multiplied by the number of units held without
consideration of transaction costs.
Instruments payable classified as Level 2 refer to all debt
instruments not classified as Level 1. The fair value of the debt
is based on estimated future cash flows converted into U.S.
dollar at the forward rate and discounted using current U.S.
dollar zero coupon rates and ArcelorMittal’s credit spread
quotations for the relevant maturities. There were no
instruments payable classified as Level 3.
reconciliations of cash flows
highly liquid investments that are readily convertible to cash with
original maturities of three months or less at the time of
purchase and are carried at cost plus accrued interest, which
approximates fair value.
Cash and cash equivalents are primarily centralized at the
parent level and are managed by ArcelorMittal Treasury SNC,
although from time to time cash or cash equivalent balances
may be held at the Company’s international subsidiaries or its
holding companies. Some of these operating subsidiaries have
debt outstanding or are subject to acquisition agreements that
255
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
impose restrictions on such operating subsidiaries’ ability to pay
dividends, but such restrictions are not significant in the context
of ArcelorMittal’s overall liquidity. Repatriation of funds from
operating subsidiaries may also be affected by tax and foreign
exchange policies in place from time to time in the various
countries where the Company operates, though none of these
policies are currently significant in the context of ArcelorMittal’s
|
December 31,
|
|||
|
2024
|
2023
|
||
|
Cash at bank
|
|
|
|
|
Term deposits
|
|
|
|
|
Money market funds
1
|
|
|
|
|
Total
|
|
|
|
1
Money market funds are highly liquid investments with a maturity of 3 months
readily available to the Company, mainly related to insurance
deposits, cash accounts in connection with environmental
obligations and true sale of receivables programs, as well as
various other deposits or required balance obligations related to
Restricted cash of
84
as of
December 31, 2024
and
97
as of
December 31, 2023 included
68
and
54
relating to various
environmental obligations, true sales of receivables programs
and letters of credit issued in ArcelorMittal South Africa. It also
included
13
and
13
in connection with the mandatory convertible
bonds as of
December 31, 2024
and
December 31, 2023
,
respectively (see note 11.2
).
Changes in restricted cash are included within investing
activities in the consolidated statements of cash flows.
arising from financing activities, including both cash and non-
cash changes. Liabilities arising from financing activities are
those for which cash flows were, or future cash flows will be
classified in the Company's consolidated statements of cash
flows from financing activities.
|
Long-term debt, net of current
portion
|
Short-term debt and current
portion of long term debt
|
||
|
Balance as of December 31, 2022 (note 6.1.2)
|
|
|
|
|
Proceeds from long-term debt
|
|
—
|
|
|
Payments of long-term debt
|
(
|
—
|
|
|
Amortized cost
|
|
(
|
|
|
Proceeds from short-term debt
|
—
|
|
|
|
Payments of short-term debt
|
—
|
(
|
|
|
Current portion of long-term debt
|
(
|
|
|
|
Payments of principal portion of lease liabilities (note 7)
1
|
(
|
(
|
|
|
Additions to lease liabilities (notes 5.2 and 7)
|
|
|
|
|
Unrealized foreign exchange effects and other movements
|
|
|
|
|
Balance as of December 31, 2023 (note 6.1.2)
|
|
|
|
|
Proceeds from long-term debt
|
|
—
|
|
|
Payments of long-term debt
|
(
|
—
|
|
|
Amortized cost
|
|
|
|
|
Proceeds from short-term debt
|
—
|
|
|
|
Payments of short-term debt
|
—
|
(
|
|
|
Current portion of long-term debt
|
(
|
|
|
|
Payments of principal portion of lease liabilities (note 7)
1
|
(
|
(
|
|
|
Additions to lease liabilities (notes 5.2 and 7)
|
|
|
|
|
Unrealized foreign exchange effects and other movements
|
(
|
(
|
|
|
Balance as of December 31, 2024 (note 6.1.2)
|
|
|
1.
Cash payments decreasing the outstanding liability relating to leases are classified under payments of principal portion of lease liabilities and other financing activities in
256
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
by original currency translated into USD at
December 31, 2024
and
December 31, 2023
:
|
As of December 31, 2024
|
Total
|
EUR
|
USD
|
ARS
|
BRL
|
INR
|
Other
|
||||||
|
Short-term debt and current portion of long-term debt
|
|
|
|
|
|
|
|
||||||
|
Long-term debt, net of current portion
|
|
|
|
|
|
|
|
||||||
|
Cash and cash equivalents and restricted cash
|
(
|
(
|
(
|
(
|
(
|
(
|
(
|
||||||
|
Net debt
|
|
|
|
(
|
(
|
|
|
|
As of December 31, 2023
|
Total
|
EUR
|
USD
|
ARS
|
BRL
|
INR
|
Other
|
||||||
|
Short-term debt and current portion of long-term debt
|
|
|
|
|
|
|
|
||||||
|
Long-term debt, net of current portion
|
|
|
|
|
|
|
|
||||||
|
Cash and cash equivalents, restricted cash and other
restricted funds
|
(
|
(
|
(
|
(
|
(
|
(
|
(
|
||||||
|
Net debt
|
|
(
|
|
(
|
(
|
|
|
manage its exposure to fluctuations in interest rates, exchange
rates, prices of raw materials, energy and emission rights
allowances arising from operating, financing and investing
activities. Derivative financial instruments are classified as
current or non-current assets or liabilities based on their maturity
dates and are accounted for at the trade date. Embedded
derivatives are separated from the host contract and accounted
for separately if they are not closely related to the host contract.
The Company measures all derivative financial instruments
based on fair values derived from market prices of the
instruments or from option pricing models, as appropriate. Gains
or losses arising from changes in fair value of derivatives are
recognized in the consolidated statements of operations, except
for derivatives that are designated and qualify for cash flow or
net investment hedge accounting.
Changes in the fair value of a derivative that is designated and
qualifies as a cash flow hedge are recorded in other
comprehensive income. Amounts deferred in equity are
recorded in the consolidated statements of operations in the
periods when the hedged item is recognized in the consolidated
statements of operations and within the same line item (see
note 6.3 Cash flow hedges).
The Company formally assesses, both at the hedge’s inception
and on an ongoing basis, whether the derivatives that are used
in hedging transactions are effective in offsetting changes in fair
values or cash flows of hedged items. When a hedging
instrument is sold, terminated, expired or exercised, the
accumulated gain or loss on the hedging instrument is
maintained in equity until the forecasted transaction occurs. If
the hedged transaction is no longer probable, the cumulative
gain or loss, which had been recognized in equity, is reported
immediately in the consolidated statements of operations.
Foreign currency differences arising on the translation of a
financial liability designated as a hedge of a net investment in a
foreign operation are recognized directly as a separate
component of equity, to the extent that the hedge is effective. To
the extent that the hedge is ineffective, such differences are
recognized in the consolidated statements of operations (see
note 6.3 Net investment hedge).
The Company manages the counter-party risk associated with
its instruments by centralizing its commitments and by applying
procedures which specify, for each type of transaction and
underlying position, risk limits and/or the characteristics of the
counter-party. The Company does not generally grant to or
require guarantees from its counterparties for the risks incurred.
Allowing for exceptions, the Company’s counterparties are part
of its financial partners and the related market transactions are
governed by framework agreements (mainly International
Swaps and Derivatives Association agreements which allow
netting only in case of counterparty default). Accordingly,
257
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
Derivative financial instruments classified as Level 2:
|
December 31, 2024
|
|||||||||
|
Assets
|
Liabilities
|
||||||||
|
Notional
Amount
|
Fair Value
|
Notional
Amount
|
Fair Value
|
||||||
|
Interest rate instruments
|
|||||||||
|
Other interest rate instruments
|
|
|
|
|
|||||
|
Total interest rate instruments
|
|
|
|||||||
|
Foreign exchange rate instruments
|
|||||||||
|
Forward purchase contracts
|
|
|
|
(
|
|||||
|
Forward sale contracts
|
|
|
|
(
|
|||||
|
Currency swaps sales
|
|
|
|
(
|
|||||
|
Currency swaps purchases
|
|
|
|
(
|
|||||
|
Exchange option purchases
|
|
|
|
|
|||||
|
Exchange options sales
|
|
|
|
(
|
|||||
|
Total foreign exchange rate instruments
|
|
(
|
|||||||
|
Raw materials (base metals), freight, energy, emission rights
|
|||||||||
|
Term contracts sales
|
|
|
|
(
|
|||||
|
Term contracts purchases
|
|
|
|
(
|
|||||
|
Options sales/purchases
|
|
|
|
|
|||||
|
Total raw materials (base metals), freight, energy, emission rights
|
|
(
|
|||||||
|
Total
|
|
(
|
|||||||
|
December 31, 2023
|
|||||||
|
Assets
|
Liabilities
|
||||||
|
Notional
Amount
|
Fair Value
|
Notional
Amount
|
Fair Value
|
||||
|
Interest rate instruments
|
|||||||
|
Other interest rate instruments
|
|
|
|
|
|||
|
Total interest rate instruments
|
|
|
|||||
|
Foreign exchange rate instruments
|
|||||||
|
Forward purchase contracts
|
|
|
|
(
|
|||
|
Forward sale contracts
|
|
|
|
(
|
|||
|
Exchange option purchases
|
|
|
|
(
|
|||
|
Exchange options sales
|
|
|
|
(
|
|||
|
Total foreign exchange rate instruments
|
|
(
|
|||||
|
Raw materials (base metals), freight, energy, emission rights
|
|||||||
|
Term contracts sales
|
|
|
|
(
|
|||
|
Term contracts purchases
|
|
|
|
(
|
|||
|
Option sales/purchases
|
|
|
|
|
|||
|
Total raw materials (base metals), freight, energy, emission rights
|
|
(
|
|||||
|
Total
|
|
(
|
|||||
258
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
In 2022, the Company unwound natural gas and emission rights
forward purchase contracts with notional of €
0.3
billion and €
0.7
billion, respectively, and carrying amount of
1,025
and
1,086
,
respectively, designated as a cash flow hedge of future natural
gas and emission rights purchases. The deferred gain
recognized in other comprehensive income is recycled to the
consolidated statements of operations when the hedged item
impacts profit or loss (see note 6.3). In addition, at maturity of
forward purchases of emission rights with notional amount of
€
0.7
billion and carrying amount of
1,408
designated as a cash
flow hedge of future emission rights purchases, the Company (i)
removed
1,268
(
953
net of tax) deferred gain recognized in
other comprehensive income from the cash flow hedge reserve
(see note 6.3) and included it in the
671
carrying amount of the
delivered emission rights as basis adjustment and (ii) recycled
operations in cost of sales.
Derivative financial assets and liabilities classified a
s Level 2:
Refer to instruments to hedge fluctuations in interest rates,
foreign exchange rates, raw materials (base metals), freight,
energy and emission rights. The total fair value is based on the
price a dealer would pay or receive for the security or similar
securities, adjusted for any terms specific to that asset or
liability. Market inputs are obtained from well-established and
recognized vendors of market data and the fair value is
calculated using standard industry models based on significant
observable market inputs such as foreign exchange rates,
commodity prices, swap rates and interest rates.
Derivative financial instruments classified as Level 3:
The fair valuation of Level 3 derivative instruments is
established at each reporting date and compared to the prior
period. ArcelorMittal’s valuation policies for Level 3 derivatives
are an integral part of its internal control procedures and have
been reviewed and approved according to the Company’s
principles for establishing such procedures. In particular, such
procedures address the accuracy and reliability of input data,
the accuracy of the valuation model and the knowledge of the
staff performing the
valuations
.
Electricity option
ArcelorMittal and an electricity supplier entered into a multi-
buyer power supply contract on the French market. Other clients
of this contract are committed to purchase electricity from the
supplier with opt-out rights to be exercised in 2029 for
2030-2034 delivery period.
The opt-out rights for 2025-2029
delivery period expired unexercised in 2024. The Company is
committed to acquire up to
51
%
of the opt-out volumes.
The fair value of the option is based on the Black-Scholes
formula model. Observable input data used in the valuation
include euro
zero
coupon yield curve and electricity forward
prices for tenors quoted by the European Energy Exchange
(EEX). A
10%
increase and decrease in electricity forward prices
would result in a
11
%
decrease and
12
%
increase, respectively,
of the fair value of the option at December 31, 2024.
value of the financial instrument classified as
Level
3:
|
|
Electricity option
|
|
|
Balance as of December 31, 2022
|
|
|
|
Change in fair value
|
(
|
|
|
Balance as of December 31, 2023
|
(
|
|
|
Change in fair value
|
|
|
|
Balance as of December 31, 2024
|
(
|
The fair value movement relating to the Level 3 derivative
instrument is recognized in financing costs-net in the
consolidated statements of operations .
and cash equivalents and restricted cash (see note 6.1.3),
certain trade and certain other receivables (see note 4.3, 4.5
and 4.6), investments in equity instruments at FVOCI (see note
2.5), trade payables and certain other liabilities (see notes 4.7
and 4.8). These instruments are recognized initially at fair value
when the Company becomes a party to the contractual
provisions of the instrument. Non-derivative financial assets are
derecognized if the Company’s contractual rights to the cash
flows from the financial instruments expire or if the Company
transfers the financial instruments to another party without
retaining control of substantially all risks and rewards of the
instruments. Non-derivative financial liabilities are derecognized
when they are extinguished (i.e. when the obligation specified in
Impairment of financial assets
credit loss ("ECL") model is required. The ECL model requires
the Group to account for expected credit losses and changes in
those ECL at each reporting date to reflect changes in credit risk
since initial recognition of the financial assets. In particular, the
Company measures the loss allowance for a financial
instrument at an amount equal to the lifetime ECL if the credit
risk on that financial instrument has increased significantly since
initial recognition.
Receivables aged 31 days or older and
uninsured trade receivables remain consistent with historical
levels and the Company did not identify any expected increased
risk of default
(note 4.3)
.
All fair value movements for investments in equity instruments at
FVOCI, including the difference between the acquisition cost
and the current fair value, are recorded in OCI and are not
259
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
reclassified to the consolidated statements of operations.
Investments in equity instruments at FVOCI are exempt from the
impairment test because the fair value of the investment is
recorded in OCI and not reclassified to profit and loss.
Financial assets are tested for ECLs annually or whenever
changes in circumstances indicate that there is a change in
credit risk. Any ECL is recognized in the consolidated
statements of operations. An ECL related to financial assets is
reversed if and to the extent there has been a change in the
factors used to determine the recoverable amount. The loss is
reversed only to the extent that the asset’s carrying amount
does not exceed the carrying amount that would have been
determined if no ECL had been recognized. Reversals of ECLs
are recognized in net income, except for investments in equity
instruments at FVOCI, in which all fair value movements are
recognized in OCI.
6.2
Financing costs - net
December 31, 2024
,
2023
and
2022
are as follows:
|
Year ended December 31,
|
|||||
|
2024
|
2023
|
2022
|
|||
|
Interest expense
|
(
|
(
|
(
|
||
|
Interest income
|
|
|
|
||
|
Accretion of defined benefit
obligations and other long term
liabilities
|
(
|
(
|
(
|
||
|
Net foreign exchange (loss)/
gain
|
(
|
(
|
|
||
|
Other
1
|
(
|
(
|
(
|
||
|
Total
|
(
|
(
|
(
|
||
1.
Other mainly included expenses related to true sale of receivables (“TSR”)
programs and bank fees. In 2024, Other included also
83
expense relating to
the fair value at acquisition date of the forward in connection with the Vallourec
acquisition (see note 2.4.2). In 2023, Other included
66
relating to the term
extension of mandatorily convertible bonds (see note 11.2).
The Company's operations expose it to a variety of financial
risks: interest rate risk, foreign exchange risk, liquidity risk and
risks in fluctuations in prices of raw materials, freight, energy
and
CO
2
emissions. The Company actively monitors and seeks
to reduce volatility of these exposures through a diversity of
financial instruments, where considered appropriate. The
Company has formalized how it manages these risks within the
Treasury and Financial Risk Management Policy, which has
been approved by Management.
Capital management
The Company's objective when managing capital is to
safeguard continuity, maintain a strong credit rating and healthy
capital ratios to support its business and provide adequate
return to shareholders through continuing growth.
The Company sets the amount of capital required on the basis
of annual business and long-term operating plans which include
capital and other strategic investments. The funding requirement
is met through a combination of equity, bonds and other long-
term and short-term borrowings.
The Company monitors capital using a gearing ratio, being the
ratio of net debt as a percentage of total equity.
|
December 31,
|
|||
|
2024
|
2023
|
||
|
Total equity
|
|
|
|
|
Net debt
|
|
|
|
|
Gearing
|
|
|
|
Interest rate risk
The Company is exposed to interest rate risk on short-term and
long-term floating rate instruments and on refinancing of fixed
rate debt. The Company's policy is to maintain a balance of
fixed and floating interest rate borrowings, which is adjusted
dep
ending on the prevailing market interest rates and outlook.
A
s at
December 31, 2024
, the long-term debt was comprised of
Company may utilize certain instruments to manage interest
rate risks. Interest rate instruments allow the Company to
borrow long-term at fixed or variable rates, and to swap the rate
of this debt either at inception or during the lifetime of the
borrowing. The Company and its counterparties exchange, at
predefined intervals, the difference between the agreed fixed
rate and the variable rate, calculated on the basis of the notional
amount of the swap. Similarly, swaps may be used for the
exchange of variable rates against other variable rates.
Foreign exchange rate risk
The Company is exposed to changes in values arising from
foreign exchange rate fluctuations generated by its operating
activities. Because a substantial portion of ArcelorMittal’s
assets, liabilities, sales and earnings are denominated in
currencies other than the U.S. dollar (its reporting currency),
ArcelorMittal has an exposure to fluctuations and depreciation in
the values of these currencies relative to the U.S. dollar. These
currency fluctuations, especially the fluctuation of the value of
the U.S. dollar relative to the euro, the Canadian dollar, Brazilian
real, Polish Zloty, South African rand, Mexican peso and
Ukrainian hryvnia, as well as fluctuations in the other countries’
currencies in which ArcelorMittal has significant operations and/
or sales, could have a material impact on its financial position,
cash flows and results of operations.
260
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
ArcelorMittal faces transaction risk, where its businesses
generate sales in one currency but incur costs relating to that
revenue in a different currency. For example, ArcelorMittal’s
subsidiaries may purchase raw materials, including iron ore and
coking coal, in U.S. dollar, but may sell finished steel products in
other currencies. Consequently, an appreciation of the U.S.
dollar will increase the cost of raw materials; thereby having a
negative impact on the Company’s operating margins, unless
the Company is able to pass along the higher cost in the form of
higher selling prices.
Following its Treasury and Financial Risk Management Policy,
the Company hedges a portion of its net exposure to foreign
exchange rates through forwards, options and swaps.
ArcelorMittal also faces foreign currency translation risk, which
arises when ArcelorMittal translates the statements of
operations of its subsidiaries, its corporate net debt (note 6.1.4)
and other items denominated in currencies other than the U.S.
dollar, for inclusion in the consolidated financial statements. The
Company manages translation risk arising from its investments
in subsidiaries by monitoring the currency mix of the
consolidated statements of financial position. The Company
may enter into derivative transactions to hedge the residual
exposure (see “Net investment hedge”).
The Company also uses derivative instruments at the corporate
level to hedge debt recorded in foreign currency other than the
functional currency or the balance sheet risk associated with
certain monetary assets denominated in a foreign currency
other than the functional currency.
Foreign currency sensitivity analysis
As of
December 31, 2024
, the Company is mainly subject to
foreign exchange exposure relating to the euro, Brazilian real,
Canadian dollar, South African rand, Mexican peso, Polish zloty,
Argentine peso and Ukrainian hryvnia against the U.S. dollar
resulting from its trade payables and receivables.
The structure
of trade receivables and trade payables by original currency
translated in USD is as follows as of December 31, 2024:
|
December 31, 2024
|
|||
|
Trade
receivables
|
Trade payables
|
||
|
USD
|
|
|
|
|
EUR
|
|
|
|
|
BRL
|
|
|
|
|
PLN
|
|
|
|
|
MAD
|
|
|
|
|
ZAR
|
|
|
|
|
ARS
|
|
|
|
|
GBP
|
|
|
|
|
UAH
|
|
|
|
|
CAD
|
|
|
|
|
MXN
|
|
|
|
|
Other
|
|
|
|
|
Total
|
|
|
|
the effects on its trade receivables and trade payables of a
10
%
increase or decrease between the relevant foreign currencies
and the U.S. dollar.
|
10% increase
|
10% decrease
|
||||||
|
Trade
receivables
|
Trade
payables
|
Trade
receivables
|
Trade
payables
|
||||
|
EUR
|
|
|
|
(
|
|
(
|
|
|
BRL
|
|
|
(
|
(
|
|||
|
PLN
|
|
|
|
(
|
|
(
|
|
|
MAD
|
|
|
(
|
(
|
|||
|
ZAR
|
|
|
|
(
|
|
(
|
|
|
ARS
|
|
|
|
(
|
|
(
|
|
|
GBP
|
|
|
(
|
(
|
|||
|
UAH
|
|
|
|
(
|
|
(
|
|
|
CAD
|
|
|
|
(
|
|
(
|
|
|
MXN
|
|
|
(
|
(
|
|||
The use of a
10
%
sensitivity rate is used when reporting foreign
currency exposure internally to key management personnel and
represents management’s assessment of the reasonably
possible change in foreign exchange rates. The sensitivity
analysis includes trade receivables and trade payables
denominated in a currency other than the U.S. dollar and
adjusts their translation at the period end for a
10
%
change in
foreign currency rates. For trade receivables, a positive number
indicates an income and a negative number an expense. For
trade payables, a positive number indicates an expense and a
negative number an income.
261
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
Hedge accounting policy
the hedged item and the hedging instrument by analyzing the
critical terms of the hedge relationship. In case critical terms do
not match and fair value changes in the hedging instrument
cannot be expected to perfectly offset changes in the fair value
of the hedged item, further qualitative analysis may be
performed. Such analysis serves to establish whether the
economic relationship is sufficiently strong to comply with the
Company’s risk management policies.
The hedge ratio is set out in the Company's risk management
strategy and may be individually tailored for each hedging
program in the risk management objective. Hedge ratios below
100% would usually be applied on hedging of forecast
exposures with the hedge ratio typically reducing where there is
uncertainty due to long hedging tenors or volatility in the
underlying exposure.
The most frequent sources of hedge ineffectiveness relate to
changes in the hedged item (such as maturity, volume and
pricing indices), basis spread and significant changes in the
credit risk. Such sources are analyzed at hedge initiation and
Liquidity Risk
Liquidity risk is the risk that the Company may encounter
difficulties in meeting its obligations associated with financial
liabilities that are settled by delivering cash. ArcelorMittal
Treasury is responsible for the Company's funding and liquidity
management. ArcelorMittal’s principal sources of liquidity are
cash generated from its operations, its credit lines at the
corporate level and various working capital credit lines at the
level of its operating subsidiaries. The Company actively
manages its liquidity. Following the Company's Treasury and
Financial Risk Management Policy, the levels of cash, credit
lines and debt are closely monitored and appropriate actions are
taken in order to comply with the covenant ratios, leverage,
fixed/floating ratios, maturity profile and currency mix.
The contractual maturities of the below financial liabilities
include estimated loan repayments, interest payments and
settlement of derivatives, excluding any impact of netting
agreements. The cash flows are calculated based on market
data as of
December 31, 2024
, and as such are sensitive to
movements in mainly foreign exchange rates and interest rates.
The cash flows are non-discounted, except for derivative
financial liabilities where the cash flows equal their fair values.
|
December 31, 2024
|
|||||||||||
|
Carrying
amount
|
Contractual
Cash Flow
|
2025
|
2026
|
from 2027 to
2029
|
After 2029
|
||||||
|
Non-derivative financial liabilities
|
|||||||||||
|
Bonds
|
(
|
(
|
(
|
(
|
(
|
(
|
|||||
|
Loans over 100
|
(
|
(
|
(
|
(
|
(
|
(
|
|||||
|
Trade and other payables
|
(
|
(
|
(
|
|
|
|
|||||
|
Other loans and leases
|
(
|
(
|
(
|
(
|
(
|
(
|
|||||
|
Total
|
(
|
(
|
(
|
(
|
(
|
(
|
|||||
|
Derivative financial liabilities
|
|||||||||||
|
Foreign exchange contracts
|
(
|
(
|
(
|
(
|
(
|
(
|
|||||
|
Commodity contracts
1
|
(
|
(
|
(
|
(
|
(
|
|
|||||
|
Total
|
(
|
(
|
(
|
(
|
(
|
(
|
|||||
1.
Commodity contracts include base metals, freight, energy and emission rights.
262
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
December 31, 2023
|
|||||||||||
|
Carrying
amount
|
Contractual
Cash Flow
|
2024
|
2025
|
from 2026
to 2028
|
After 2028
|
||||||
|
Non-derivative financial liabilities
|
|||||||||||
|
Bonds
|
(
|
(
|
(
|
(
|
(
|
(
|
|||||
|
Loans over 100
|
(
|
(
|
(
|
(
|
(
|
(
|
|||||
|
Trade and other payables
|
(
|
(
|
(
|
|
|
|
|||||
|
Other loans and leases
|
(
|
(
|
(
|
(
|
(
|
(
|
|||||
|
Total
|
(
|
(
|
(
|
(
|
(
|
(
|
|||||
|
Derivative financial liabilities
|
|||||||||||
|
Foreign exchange contracts
|
(
|
(
|
(
|
(
|
(
|
|
|||||
|
Commodity contracts
1
|
(
|
(
|
(
|
(
|
|
(
|
|||||
|
Total
|
(
|
(
|
(
|
(
|
(
|
(
|
|||||
Cash flow hedges
|
December 31, 2024
|
|||||||||||
|
Assets/
(liabilities)
|
(Outflows)/inflows
|
||||||||||
|
Fair value
|
3 months and
less
|
3-6 months
|
6-12 months
|
2026
|
After 2026
|
||||||
|
Foreign exchange contracts
|
(
|
(
|
(
|
(
|
(
|
(
|
|||||
|
Commodities
|
|
|
|
|
(
|
|
|||||
|
Emission rights
|
|
|
|
|
|
|
|||||
|
Total
|
(
|
|
(
|
(
|
(
|
(
|
|||||
|
December 31, 2023
|
|||||||||||
|
Assets/
(liabilities)
|
(Outflows)/inflows
|
||||||||||
|
Fair value
|
3 months and
less
|
3-6 months
|
6-12 months
|
2025
|
After 2025
|
||||||
|
Foreign exchange contracts
|
(
|
(
|
(
|
(
|
|
|
|||||
|
Commodities
|
|
|
|
|
|
|
|||||
|
Emission rights
|
|
|
|
|
|
|
|||||
|
Total
|
|
|
|
|
|
|
|||||
Associated gains or losses that were recognized in other comprehensive income are reclassified to the consolidated statements of
operations in the same period during which the hedged forecasted cash flow affects the consolidated statements of operations.
The
following table presents the periods in which the realized and unrealized gains or losses on derivatives designated as cash flows
hedges recognized in other comprehensive income, net of tax, are expected to impact the consolidated statements of operations:
263
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
December 31, 2024
|
|||||||||||
|
Cash flow hedge
reserve
1
|
(Expense)/income
|
||||||||||
|
Carrying amount
|
3 months and
less
|
3-6 months
|
6-12 months
|
2026
|
After 2026
|
||||||
|
Foreign exchange contracts
|
(
|
(
|
(
|
(
|
(
|
(
|
|||||
|
Commodity contracts
|
|
|
|
|
|
|
|||||
|
Emission rights
|
|
|
|
|
|
|
|||||
|
Total
|
|
|
|
|
|
|
|||||
1.
The cash flow hedge reserve balance as of December 31, 2024 includes
365
deferred gains for the Company's share of such reserves at its equity method investments,
which are not included in the table above (
417
as of December 31, 2023).
|
December 31, 2023
|
|||||||||||
|
Cash flow hedge
reserve
1
|
(Expense)/income
|
||||||||||
|
Carrying amount
|
3 months and
less
|
3-6 months
|
6-12 months
|
2025
|
After 2025
|
||||||
|
Foreign exchange contracts
|
|
|
|
|
|
|
|||||
|
Commodity contracts
|
|
|
|
|
|
|
|||||
|
Emission rights
|
|
|
|
|
|
|
|||||
|
Total
|
|
|
|
|
|
|
|||||
1.
The cash flow hedge reserve balance as of December 31, 2023 also includes
417
deferred gains for the Company's share of such reserves at its equity method
investments, which are not included in the table above (
1,023
as of December 31, 2022).
264
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
of comprehensive income and statement of changes in equity.
|
December 31, 2024
|
|||||||
|
Hedging Instruments
|
Nominal amount of
the hedging
instrument
|
Assets
carrying
amount
|
Liabilities
carrying
amount
|
Line item in the statement of financial
position where the hedging instrument
is located
|
|||
|
Cash flow hedges
|
|||||||
|
Foreign exchange risk - Option/forward/swap
contracts
|
|
|
(
|
Prepaid expenses and other current
assets/Accrued expenses and other
liabilities
|
|||
|
Foreign exchange risk - Option/forward/swap
contracts
|
|
|
(
|
Other assets/Other long-term
obligations
|
|||
|
Price risk - Commodities Options/forwards
|
|
|
(
|
Prepaid expenses and other current
assets/Accrued expenses and other
liabilities
|
|||
|
Price risk - Commodities Options/forwards
|
|
|
(
|
Other assets/Other long-term
obligations
|
|||
|
Price risk - Emission rights forwards
|
|
|
|
Prepaid expenses and other current
assets/Accrued expenses and other
liabilities
|
|||
|
Total
|
|
(
|
|||||
|
Current derivative assets classified as cash flow
hedge
|
|
||||||
|
Other current derivative assets
|
|
||||||
|
Total current derivative assets (note 4.5)
|
|
||||||
|
Non-current derivative assets classified as cash flow
hedge
|
|
||||||
|
Other non-current derivative assets
|
|
||||||
|
Total non-current derivative assets (note 4.6)
|
|
||||||
|
Current derivative liabilities classified as cash flow
hedge
|
(
|
||||||
|
Other current derivative liabilities
|
(
|
||||||
|
Total current derivative liabilities (note 4.8)
|
(
|
||||||
|
Non-current derivative liabilities classified as cash
flow hedge
|
(
|
||||||
|
Other non-current derivative liabilities
|
(
|
||||||
|
Total non-current derivative liabilities (note 9.2)
|
(
|
||||||
|
December 31, 2024
|
|||||||||
|
Hedging Instruments
|
Cash flow
hedge
reserve at
December 31,
2023
|
Hedging
gains or
losses of the
reporting
period that
were
recognized in
OCI
|
Gains or
losses
reclassification
adjustment
and hedge
ineffectiveness
|
Basis
adjustment
|
Line item in the
statement of
comprehensive
income that
includes the
reclassification
adjustment and
hedge
ineffectiveness
|
Cash flow
hedge
reserve
1
at
December 31,
2024
|
|||
|
Cash flow hedges
|
|||||||||
|
Foreign exchange risk - Option/Forward contracts
|
|
(
|
(
|
(
|
Sales
|
(
|
|||
|
Price risk - Commodities Option/Forward contracts
|
|
(
|
|
(
|
Sales, Cost of
sales
|
|
|||
|
Price risk - Emission rights forwards
|
|
(
|
(
|
|
Cost of sales
|
|
|||
|
Total
|
|
(
|
|
(
|
|
||||
1.
The cash flow hedge reserve balance as of December 31, 2024 also includes
365
deferred gains for the Company's share of such reserves at its equity method
investments, which are not disclosed above.
265
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
.
|
December 31, 2023
|
|||||||
|
Hedging Instruments
|
Nominal amount of
the hedging
instrument
|
Assets carrying
amount
|
Liabilities
carrying
amount
|
Line item in the statement of financial position where
the hedging instrument is located
|
|||
|
Cash flow hedges
|
|||||||
|
Foreign exchange risk - Option/
Forward contracts
|
|
|
(
|
Prepaid expenses and other current assets/Accrued
expenses and other liabilities
|
|||
|
Foreign exchange risk - Option/
Forward/Swap contracts
|
|
|
|
Other assets/Other long-term obligations
|
|||
|
Price risk - Commodities forwards
|
|
|
(
|
Prepaid expenses and other current assets/Accrued
expenses and other liabilities
|
|||
|
Price risk - Commodities forwards
|
|
|
(
|
Other assets/Other long-term obligations
|
|||
|
Price risk - Emission rights
forwards
|
|
|
|
Prepaid expenses and other current assets/Accrued
expenses and other liabilities
|
|||
|
Total
|
|
(
|
|||||
|
Current derivative assets classified
as cash flow hedge
|
|
||||||
|
Other current derivative assets
|
|
||||||
|
Total current derivative assets
(note 4.5)
|
|
||||||
|
Non-current derivative assets
classified as cash flow hedge
|
|
||||||
|
Other non-current derivative assets
|
|
||||||
|
Total non-current derivative assets
(note 4.6)
|
|
||||||
|
Current derivative liabilities
classified as cash flow hedge
|
(
|
||||||
|
Other current derivative liabilities
|
(
|
||||||
|
Total current derivative liabilities
(note 4.8)
|
(
|
||||||
|
Non-current derivative liabilities
classified as cash flow hedge
|
(
|
||||||
|
Other non-current derivative
liabilities
|
(
|
||||||
|
Total non-current derivative
liabilities (note 9.2)
|
(
|
||||||
|
December 31, 2023
|
|||||||||||
|
Hedging Instruments
|
Cash flow hedge
reserve at
December 31,
2022
|
Hedging
gains or
losses of the
reporting
period that
were
recognized in
OCI
|
Gains or losses
reclassification
adjustment and
hedge
ineffectiveness
|
Basis
adjustment
|
Line item in the
statement of
comprehensive
income that
includes the
reclassification
adjustment and
hedge
ineffectiveness
|
Cash flow hedge
reserve
1
at
December 31,
2023
|
|||||
|
Cash flow hedges
|
|||||||||||
|
Foreign exchange risk - Option/
Forward contracts
|
|
|
(
|
|
Sales
|
|
|||||
|
Price risk - Commodities forwards
1
|
|
(
|
(
|
|
Sales, Cost of
sales
|
|
|||||
|
Price risk - Emission rights forwards
|
|
|
(
|
|
Cost of sales
|
|
|||||
|
Total
|
|
(
|
(
|
|
|
||||||
1.
The cash flow hedge reserve balance as of December 31, 2023 also includes
417
deferred gains for the Company's share of such reserves at its equity method
investments, which are not disclosed above
266
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
Net investment hedge
The Compa
ny designated a portfolio of euro denominated debt
as a hedge of certain euro denominated investmen
ts (see also
note 6.1.2.2.)
The Company has periodically hedged a part of its euro
denominated net investments via euro/U.S. dollar cross
currency swaps ("CCS"). These CCS, all of which have been
unwound, were designated as net investment hedges. The
hedging instrument is categorized as Level 2.
be recycled to the consolidation statements of operations when
the hedged assets are disposed of.
|
December 31, 2024
1
|
|||||||
|
Date traded
|
Date maturity /unwound
|
Notional
|
OCI gross
|
Deferred tax
|
OCI net of deferred
tax
|
||
|
December, 2014
|
January, 2016
|
|
|
(
|
|
||
|
May, 2015
|
March, 2020
|
|
|
(
|
|
||
|
May, 2015
|
July, 2019
|
|
(
|
|
(
|
||
|
March, 2018
|
June, 2018
|
|
|
(
|
|
||
|
April, 2019
|
November, 2019
|
|
|
(
|
|
||
|
Total
|
|
(
|
|
||||
1.
In
2024 and in 2023, the Company did not designate any new CCS as net investment hedge.
|
December 31, 2024
|
|||||||||||||
|
Hedging Instruments
|
Nominal
amount of
the hedging
instrument
|
Assets
carrying
amount
|
Liabilities
carrying
amount
|
Line item in the
statement of
financial position
where the
hedging
instrument is
located
|
Change in
value used for
calculating
hedge
ineffectiveness
for 2024
|
Line item in the
statement of
comprehensive
income that
includes the
recognized hedge
ineffectiveness
|
Foreign
currency
translation
reserve
|
||||||
|
Net investment hedges
|
|||||||||||||
|
Foreign exchange risk -
Cross Currency Swap
|
|
|
|
N/a
|
|
N/a
|
|
||||||
|
Foreign exchange risk -
EUR debt
|
|
|
|
Short-term debt
and current
portion of long-
term debt; long-
term debt, net of
current portion
|
|
N/a
|
|
||||||
|
Total
|
|
|
|
|
|
||||||||
|
December 31, 2023
|
|||||||||||||
|
Hedging Instruments
|
Nominal
amount of
the hedging
instrument
|
Assets
carrying
amount
|
Liabilities
carrying
amount
|
Line item in the
statement of
financial position
where the hedging
instrument is
located
|
Change in
value used for
calculating
hedge
ineffectiveness
for 2023
|
Line item in the
statement of
comprehensive
income that includes
the recognized
hedge
ineffectiveness
|
Foreign
currency
translation
reserve
|
||||||
|
Net investment hedges
|
|||||||||||||
|
Foreign exchange risk -
Cross Currency Swap
|
|
|
|
N/a
|
|
N/a
|
|
||||||
|
Foreign exchange risk - EUR
debt
|
|
|
|
Short-term debt
and current portion
of long-term debt;
long-term debt, net
of current portion
|
|
N/a
|
|
||||||
|
Total
|
|
|
|
|
|
||||||||
267
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
Raw materials, freight, energy risks and emission rights
The Company is exposed to risks in fluctuations in prices of raw materials (including base metals such as zinc, nickel, aluminum, tin,
copper and iron ore), freight and energy, both through the purchase of raw materials and through sales contracts. The Company uses
financial instruments such as forward purchases or sales, options and swaps in order to manage the volatility of prices of certain raw
materials, freight and energy.
|
December 31,
|
|||
|
2024
|
2023
|
||
|
Base metals
|
(
|
(
|
|
|
Freight
|
|
|
|
|
Energy (oil, gas, electricity)
|
|
|
|
|
Emission rights
|
|
|
|
|
Total
|
|
|
|
|
Derivative assets associated with raw materials, energy, freight and emission rights
|
|
|
|
|
Derivative liabilities associated with raw materials, energy, freight and emission rights
|
(
|
(
|
|
|
Total
|
|
|
|
ArcelorMittal consumes large amounts of raw materials (the
prices of which are related to the London Metals Exchange price
index, the Steel Index and Platts Index), ocean freight (the price
of which is related to a Baltic Exchange Index), and energy (the
prices of which are mainly related to the New York Mercantile
Exchange energy index (NYMEX) and the EEX power indexes).
As a general matter, ArcelorMittal is exposed to price volatility
with respect to its purchases in the spot market and under its
long-term supply contracts. In accordance with its risk
management policy, ArcelorMittal hedges a part of its exposure
related to raw materials procurement.
Emission rights
Pursuant to the application of the European Directive 2003/87/
EC of October 13, 2003, as amended by the European Directive
2009/29/EC of April 23, 2009, establishing a scheme for
emission allowance trading, the Company enters into certain
types of derivatives (mainly forward transactions and options) in
order to implement its management policy for associated risks.
As of
December 31, 2024
and
2023
, the Company had a net
notional position of
(
2
)
with a net
nil
fair value and a net notional
position of
164
with a net positive fair value of
18
,
respectively.
Credit risk
The Company’s treasury department monitors various market
data regarding the credit standings and overall reliability of the
financial institutions for all countries where the Company’s
subsidiaries operate. The choice of the financial institution for
the financial transactions must be approved by the treasury
department. Credit risk related to customers, customer credit
terms and receivables are discussed in note 4.3.
Sensitivity analysis
Foreign currency sensitivity
The following tables demonstrate the Company’s derivative
financial instruments' sensitivity to a
10
%
strengthening and a
against the relevant currencies, with all other variables held
constant. A positive number indicates an increase in profit or
loss and other equity, where a negative number indicates a
decrease in profit or loss and other equity.
The sensitivity analysis includes the Company’s complete
portfolio of foreign currency derivatives outstanding.
|
December 31, 2024
|
|||
|
Income
(loss)
|
Other Equity
|
||
|
10% strengthening in U.S. dollar
|
(
|
(
|
|
|
10% strengthening in Euro
|
|
|
|
|
10% weakening in U.S. dollar
|
|
|
|
|
10% weakening in Euro
|
(
|
|
|
|
December 31, 2023
|
|||||
|
Income
(loss)
|
Other Equity
|
||||
|
10% strengthening in U.S. dollar
|
(
|
|
|||
|
10% strengthening in Euro
|
|
|
|||
|
10% weakening in U.S. dollar
|
|
(
|
|||
|
10% weakening in Euro
|
(
|
|
|||
268
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
Cash flow sensitivity analysis for variable rate instruments
The following tables detail the Company’s variable interest rate
instruments’ sensitivity. A change of
100
basis points (“bp”) in
interest rates during the period would have increased
(decreased) profit or loss by the amounts presented below. This
analysis assumes that all other variables, in particular foreign
currency rates, remain constant.
|
December 31, 2024
|
|||
|
Floating portion of
net debt
1
|
Interest Rate Swaps/
Forward Rate Agreements
|
||
|
|
|
|
|
|
|
(
|
(
|
|
|
December 31, 2023
|
|||
|
Floating portion of
net debt
1
|
Interest Rate Swaps/
Forward
Rate Agreements
|
||
|
|
|
|
|
|
|
(
|
(
|
|
1.
See note 6.1.4 for a description of net debt (including fixed and floating
portion).
Base metals, energy, freight, emissions rights
increase and decrease in the price of the relevant base metals,
energy, freight and emissions rights. The sensitivity analysis
includes only outstanding, un-matured derivative instruments
either held for trading at fair value through the consolidated
statements of operations or designated in hedge accounting
relationships.
|
December 31, 2024
|
|||
|
Income (loss)
|
Other Equity Cash Flow
Hedging Reserves
|
||
|
'
+
|
|||
|
Base Metals
|
|
|
|
|
Iron Ore
|
|
|
|
|
Freight
|
|
|
|
|
Emission rights
|
|
|
|
|
Energy
|
(
|
|
|
|
'
-
|
|||
|
Base Metals
|
(
|
(
|
|
|
Iron Ore
|
|
(
|
|
|
Freight
|
|
(
|
|
|
Emission rights
|
|
|
|
|
Energy
|
|
(
|
|
|
December 31, 2023
|
|||
|
Income (loss)
|
Other Equity Cash Flow
Hedging Reserves
|
||
|
'
+
|
|||
|
Base Metals
|
(
|
|
|
|
Iron Ore
|
(
|
|
|
|
Freight
|
|
|
|
|
Emission rights
|
(
|
|
|
|
Energy
|
|
|
|
|
'
-
|
|||
|
Base Metals
|
|
(
|
|
|
Iron Ore
|
|
(
|
|
|
Freight
|
|
(
|
|
|
Emission rights
|
|
|
|
|
Energy
|
|
(
|
|
269
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
a lease at inception of the contract. A contract is or contains a
lease if the contract conveys the right to control the use of an
identified asset for a period of time in exchange for
consideration.
The Company recognizes a right-of-use asset and a lease
liability at the commencement date, except for short-term leases
of twelve months or less and leases for which the underlying
asset is of low value, which are expensed in the consolidated
statement of operations on a straight-line basis over the lease
term.
The lease liability is initially measured at the present value of the
lease payments that are not paid at the commencement date,
discounted using the interest rate implicit in the lease, or, if not
readily determinable, the incremental borrowing rate specific to
the country, term and currency of the contract. Lease payments
can include fixed payments, variable payments that depend on
an index or rate known at the commencement date, as well as
any extension or purchase options, if the Company is
reasonably certain to exercise these options. The lease liability
is subsequently measured at amortized cost using the effective
interest method and remeasured with a corresponding
adjustment to the related right-of-use asset when there is a
change in future lease payments in case of renegotiation,
changes of an index or rate or in case of reassessments of
options.
The right-of-use asset comprises, at inception, the initial lease
liability, any initial direct costs and, when applicable, the
obligations to refurbish the asset, less any incentives granted by
the lessors. The right-of-use asset is subsequently depreciated
on a straight-line basis to the earlier end of its estimated useful
life or the end of the lease term or to the end of the estimated
useful life of the underlying asset, if the lease transfers the
ownership of the underlying asset to the Company at the end of
the lease term or if the cost of the right-of-use asset reflects that
the lessee will exercise a purchase option. Right-of-use assets
are also subject to testing for impairment if there is an indicator
that they may be impaired.
Variable lease payments not included in the measurement of the
lease liabilities are expensed to the consolidated statement of
operations in the period in which the events or conditions which
trigger those payments occur.
In the statement of financial position, right-of-use assets and
lease liabilities are classified, respectively, as part of property,
|
As at December
31, 2024
|
As at December
31, 2023
|
|||
|
Lease liabilities
|
|
|
||
|
Right of-use assets:
|
||||
|
Land, buildings and improvements
|
|
|
||
|
Machinery, equipment and others
|
|
|
||
|
Total right-of-use assets
|
|
|
||
|
Year ended
December 31,
2024
|
Year ended
December 31,
2023
|
|||
|
Depreciation and impairment charges:
|
||||
|
Land, buildings and improvements
|
|
|
||
|
Machinery, equipment and others
|
|
|
||
|
Total depreciation and impairment charges
|
|
|
||
|
Other lease related expenses:
|
||||
|
Interest expense on lease liabilities
|
|
|
||
|
Expenses of short-term leases
|
|
|
||
|
Expenses of leases of low-value assets
|
|
|
||
|
Expenses related to variable lease payments not included in the measurement of lease liabilities
|
|
|
||
|
Additions to right-of-use assets
|
|
|
||
|
Lease payments recorded as reduction of lease liabilities and cash outflow from financing activities
|
|
|
270
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
The Company's lease contracts relate to a variety of assets used in its operational and administrative activities through several units,
such as land, buildings, vehicles, industrial machinery, logistic and commercial facilities and power generation facilities. There are no
sale and lease back transactions and no restrictions or covenants are imposed by the Company's current effective lease contracts.
|
December 31, 2024
|
|||||
|
1 year or less
|
2-3 years
|
4-5 years
|
Greater than 5 years
|
TOTAL
|
|
|
Lease liabilities (undiscounted)
|
|
|
|
|
|
|
December 31, 2023
|
|||||
|
1 year or less
|
2-3 years
|
4-5 years
|
Greater than 5 years
|
TOTAL
|
|
|
Lease liabilities (undiscounted)
|
|
|
|
|
|
Expenses for variable lease payments relate to rental fees that vary based on the actual level of activities or performance of the
underlying leased assets such as a percentage of sales of the Company's goods through certain leased commercial warehouses and
fixed rental fees per actual unit of output produced or transported by the leased assets.
lease payments, which are not reflected in the measurement of lease liabilities as of December 31, 2024 and December 31, 2023, is as
follows:
|
December 31, 2024
|
|||||
|
1 year or less
|
2-3 years
|
4-5 years
|
Greater than 5 years
|
TOTAL
|
|
|
Potential variable lease
payments
|
|
|
|
|
|
|
December 31, 2023
|
|||||
|
1 year or less
|
2-3 years
|
4-5 years
|
Greater than 5 years
|
TOTAL
|
|
|
Potential variable lease
payments
|
|
|
|
|
|
Also, some of the Company's lease contracts have extension and/or termination options as well as residual value guarantees whose
amounts are not reflected in the measurement of the lease liabilities as of December 31, 2024 and December 31, 2023.
The potential
addition/(reduction) in future cash outflows to which the Company is exposed in case such options are exercised or the guarantees
required are as shown in the table below:
|
December 31, 2024
|
|||||
|
1 year or less
|
2-3 years
|
4-5 years
|
Greater than 5 years
|
TOTAL
|
|
|
Potential extension options
|
|
|
|
|
|
|
Potential termination options
|
|
|
|
(
|
(
|
|
Potential residual value guarantees
|
|
|
|
|
|
|
December 31, 2023
|
|||||
|
1 year or less
|
2-3 years
|
4-5 years
|
Greater than 5 years
|
TOTAL
|
|
|
Potential extension options
|
|
|
|
|
|
|
Potential termination options
|
|
(
|
|
(
|
(
|
|
Potential residual value guarantees
|
|
|
|
|
|
271
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
Undiscounted amounts related to lease contracts not yet commenced and therefore not included in the recognized lease liabilities as of
December 31, 2024 and December 31, 2023, to which the Company is committed are described below:
|
December 31, 2024
|
|||||
|
1 year or less
|
2-3 years
|
4-5 years
|
Greater than 5 years
|
TOTAL
|
|
|
Leases not yet commenced
|
|
|
|
|
|
|
December 31, 2023
|
|||||
|
1 year or less
|
2-3 years
|
4-5 years
|
Greater than 5 years
|
TOTAL
|
|
|
Leases not yet commenced
|
|
|
|
|
|
There were
neither
income from subleasing right-of-use assets
nor gains or losses from sales and leaseback for the years
ended December 31, 2024 and December 31, 2023.
approximately
125,000
,
127,000
and
154,000
employees,
respectively, and the total annual compensation of
ArcelorMittal’s employees in
2024
,
2023
and
2022
was as
follows:
|
|
Year ended December 31,
|
||||
|
Employee Information
|
2024
|
2023
|
2022
|
||
|
Wages and salaries
|
|
|
|
||
|
Defined benefits cost (see
note 8.2)
|
|
|
|
||
|
Other staff expenses
|
|
|
|
||
|
Total
|
|
|
|
||
management personnel, including its Board of Directors, in
2024
,
2023
and
2022
was as follows:
|
|
Year ended December 31,
|
||||
|
|
2024
|
2023
|
2022
|
||
|
Base salary and directors fees
|
|
|
|
||
|
Short-term performance-
related bonus
|
|
|
|
||
|
Post-employment benefits
|
|
|
|
||
|
Fair value of long-term
incentives
|
|
|
|
||
The fair value of the shares allocated based on Restricted Share
Unit (“RSU”) and Performance Share Unit (“PSU”) plans to
ArcelorMittal’s key management personnel was recorded as an
expense in the consolidated statements of operations over the
relevant vesting periods.
As of
December 31, 2024
,
2023
and
2022
, ArcelorMittal did not
have any outstanding loans or advances to members of its
Board of Directors or key management personnel, and, as of
December 31, 2024
,
2023
and
2022
, ArcelorMittal had not given
any guarantees for the benefit of any member of its Board of
pension plans for their employees. Also, some of the operating
subsidiaries offer other post-employment benefits, that are
principally post-retirement healthcare plans. These benefits are
broken down into defined contribution plans and defined benefit
plans.
Defined contribution plans are those plans where ArcelorMittal
pays fixed or determinable contributions to external insurance or
funds for certain employees. Contributions are paid in return for
services rendered by the employees during the period.
Contributions are expensed as incurred consistent with the
recognition of wages and salaries.
Defined benefit plans are those plans that provide guaranteed
benefits to certain employees, either by way of contractual
obligations or through a collective agreement. For defined
benefit plans, the cost of providing benefits is determined using
the projected unit credit method, with actuarial valuations being
carried out each fiscal year.
The retirement benefit obligation recognized in the consolidated
statements of financial position represents the present value of
the defined benefit obligation less the fair value of plan assets.
The impact arising from the remeasurement of the benefit
obligation and plan assets due to experience and changes in
actuarial assumptions are charged or credited to other
comprehensive income in the period in which they arise. Any
assets resulting from this calculation are limited to the present
value of available refunds and reductions in future contributions
to the plan.
Current service cost, which is the increase of the present value
of the defined benefit obligation resulting from the employee
272
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
service in the current period, is recorded as an expense as part
of cost of sales and selling, general and administrative
expenses in the consolidated statements of operations. The net
interest cost, which is the change during the period in the net
defined benefit liability or asset that arises from the passage of
time, is recognized as part of net financing costs in the
consolidated statements of operations.
The Company recognizes gains and losses on the settlement of
a defined benefit plan when the settlement occurs. The gain or
loss on settlement comprises any resulting change in the fair
value of plan assets and any change in the present value of the
defined benefit obligation. Past service cost is the change in the
present value of the defined benefit obligation resulting from a
plan amendment or a curtailment. Past service cost is
recognized immediately in the consolidated statements of
operations in the period in which it arises.
Termination plans are those plans that primarily correspond to
terminating an employee’s contract usually following the
decision of the employee before the normal retirement date.
Liabilities for termination plans are recognized when the affected
employees have formally been informed and when amounts
owed have been determined using an appropriate actuarial
calculation. Liabilities relating to long-term termination plans
(like early retirement plans) are calculated annually based on
the number of employees that have taken or contractually
agreed to take early retirement and are discounted using an
interest rate that corresponds to that of high-quality bonds that
have maturity dates similar to the terms of the Company’s early
retirement obligations. Provisions for social plans are recorded
in connection with voluntary separation plans. Voluntary
retirement plans primarily correspond to the practical
implementation of social plans or are linked to collective
agreements signed with certain categories of employees. The
Company recognizes a liability and expense when it can no
longer withdraw the offer or, if earlier, when it has a detailed
formal plan which has been communicated to employees or
their representatives.
Other long-term employee benefits include various plans that
depend on the length of service, such as long service and
sabbatical awards, disability benefits and long-term
compensated absences such as sick leave. The amount
recognized as a liability is the present value of benefit
obligations at the consolidated statements of financial position
date, and all changes in the provision (including actuarial gains
and losses or past service costs) are recognized in the
consolidated statements of operations in the period in which
they arise.
The expense associated with the above pension plans and post-
employment benefits, as well as the carrying amount of the
related liability/asset on the consolidated statements of financial
position are based on several assumptions and factors such as
discount rates, expected rate of compensation increase,
healthcare cost trend rates, mortality rates and retirement rates.
•
Discount rates – The present value of the defined
benefit obligation is determined by discounting the
estimated future cash outflows using interest rates of
high-quality corporate bonds that are denominated in
the currency in which the benefit will be paid. In
countries where there is no deep market in such
bonds, the market rates on government bonds are
used. Nominal interest rates vary worldwide due to
exchange rates and local inflation rates.
•
Rate of compensation increase – The rate of
compensation increase reflects actual experience and
the Company’s long-term outlook, including
contractually agreed wage rate increases for
represented hourly employees.
•
Healthcare cost trend rate – The healthcare cost trend
rate is based on historical retiree cost data, near-term
healthcare outlook, including appropriate cost control
measures implemented by the Company, and industry
benchmarks and surveys.
•
Mortality and retirement rates – Mortality and
retirement rates are based on actual and projected
plan experience.
Statements of Financial Position
post-employment benefits, are as follows:
|
|
December 31,
|
||
|
|
2024
|
2023
|
|
|
Pension plan benefits
|
|
|
|
|
Other post-employment benefits and other
long-term employee benefits ("OPEB")
|
|
|
|
|
Termination benefits
|
|
|
|
|
Defined benefit liabilities
|
|
|
|
|
Provisions for social plans (non-current)
|
|
|
|
|
Total
|
|
|
|
This note, including the table above, discloses the following
benefit categories:
•
pension plan benefits are pension plans and lump sum
benefits that are classified under post-employment
benefits as required by IAS 19 which are not
mandatory by law;
•
other post-employment and other long-term employee
benefits, also referred to as, OPEB which includes all
273
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
other post-employment benefits as defined in IAS 19
(e.g. lump sum benefits which are mandatory by law,
medical insurance and life insurance) together with all
other long-term employee benefits as defined in IAS
19;
•
termination benefits, which relate to provisions for long
term termination benefits as defined in IAS 19 (e.g.
early retirement benefits).
The provisions for
termination benefits relate to European countries
(Belgium and Germany)
; and
•
provisions for social plans (non-current) which relate to
provisions for social plans in restructuring provisions as
required by IAS 37.
Pension plans
This section includes post-employment benefits that are pension
plan and lump sum benefits which are not mandatory by
law
. A
summary of the significant defined benefit pension plans is as
follows:
Canada
The primary pension plans are those of ArcelorMittal Dofasco,
AMMC and ArcelorMittal Long Products Canada.
The ArcelorMittal Dofasco pension plan is a hybrid plan
providing the benefits of both a defined benefit and defined
contribution pension plan. The defined contribution component
is financed by both employer and employee contributions. The
employer’s defined contribution is based on a percentage of
company profits. The defined benefit pension plan was closed
for new hires on December 31, 2010 and replaced by a new
defined contribution pension plan with contributions related to
age, service and earnings.
At the end of 2012, ArcelorMittal Dofasco froze and capped
benefits for the majority of its hourly and salaried employees
who were still accruing service under the defined benefit plan
and began transitioning these employees to the new defined
contribution pension plan for future pension benefits.
In 2023 and 2024, ArcelorMittal Dofasco entered into buy-in
transactions for a portion of its fully funded pension plans
representing
352
and
356
obligations, respectively.
The AMMC defined benefit plan provides salary related benefit
for non-union employees and a flat dollar pension depending on
an employee’s length of service for union employees. This plan
was closed for new non-union hires on December 31, 2009 and
replaced by a defined contribution pension plan with
contributions related to age and service. Unionized employees
of AMMC have the choice, after their first year of employment, to
remain in the defined benefit plan or to transfer to the unionized
employees’ defined contribution plan. Effective January 1, 2015,
AMMC implemented a plan to transition its non-union
employees who were still benefiting under the defined benefit
plan to a defined contribution pension plan. The transition period
was completed as of January 1,
2025
.
In 2023, AMMC entered into a buy-in transaction for a portion of
its fully funded pension plans representing obligations of
100
.
ArcelorMittal Long Products Canada sponsors several defined
benefit and defined contribution pension plans for its various
groups of employees, with most defined benefit plans closed to
new entrants several years ago. The primary defined benefit
pension plan sponsored by ArcelorMittal Long Products Canada
provides certain unionized employees with a flat dollar pension
depending on an employee’s length of service.
ArcelorMittal Long Products Canada continued to operate under
a
six
-year
collective labor agreement ("CLA") renewed on
August 1, 2020 with its Contrecoeur-West union group. Its
defined benefit plan was closed to new hires and a new defined
contribution type arrangement was established for new hires. A
it covers Contrecoeur East and Longueuil facilities; its defined
benefit pension plan is offered for all employees including new
hires
.
In 2020 and 2022, ArcelorMittal Long Products Canada entered
into buy-in transactions for a portion of its fully funded pension
plans representing
278
obligations.
Brazil
The primary defined benefit plans, financed through trust
funds, have been closed to new entrants. Brazilian entities have
all established defined contribution plans that are financed by
employer and employee contributions.
Europe
Certain European operating subsidiaries maintain primarily
unfunded defined benefit pension plans for a certain number of
employees. Benefits are based on such employees’ length of
service and applicable pension table under the terms of
individual agreements. Some of these unfunded plans have
been closed to new entrants and replaced by defined
contribution pension plans for active members financed by
employer and employee contributions.
As from December 2015 new Belgian legislation modifies the
minimum guaranteed rates of return applicable to Belgian
defined contribution plans. For insured plans, the rates of
3.25
%
on employer contributions and
3.75
%
on employee contributions
will continue to apply to the accumulated pre-2016 contributions.
For contributions paid as from January 1, 2016, a new variable
minimum guaranteed rate of return applies. From 2016 through
2024, the minimum guaranteed rate of return was
1.75
%
. For
new contributions as from January 1, 2025, the minimum
274
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
guaranteed rate of return is fixed at
2.50
%
. Due to the statutory
minimum guaranteed return, Belgian defined contribution plans
do not meet the definition of defined contribution plans under
IFRS. Therefore, the Belgian defined contribution plans are
classified as defined benefit plans.
I
n 2024, ArcelorMittal Bremen and the works council reached an
agreement regarding the restructuring of pension plans with a
recognition of plan amendment gain of
44
in cost of sales.
Others
A very limited number of defined benefit plans are in place in
other countries (such as Mexico, Morocco, Ukraine and the
United States of America).
The majority of the funded defined benefit pension plans
described earlier provide benefit payments from trustee-
administered funds. ArcelorMittal also sponsors a number of
unfunded plans where the Company meets the benefit payment
obligation as it falls due. Plan assets held in trusts are legally
separated from the Company and are governed by local
regulations and practice in each country, as is the nature of the
relationship between the Company and the governing bodies
and their composition. In general terms, governing bodies are
required by law to act in the best interest of the plan members
and are responsible for certain tasks related to the plan (e.g.
setting the plan's investment policy).
In case of the funded pension plans, the investment positions
are generally managed within an asset-liability matching ("ALM")
framework that has been developed to achieve long-term
investments that are in line with the obligations of the pension
plans.
A long-term investment strategy has been set for ArcelorMittal’s
major funded pension plans, with its asset allocation comprising
of a mixture of equity securities, fixed income securities, real
estate and other appropriate assets. This recognizes that
different asset classes are likely to produce different long-term
returns and some asset classes may be more volatile than
others. The long-term investment strategy ensures, in particular,
that investments are adequately diversified.
275
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
financial position.
|
Year ended December 31, 2024
|
|||||||||
|
Total
|
Canada
|
Brazil
|
Europe
|
Other
|
|||||
|
Change in benefit obligation
|
|||||||||
|
Benefit obligation at beginning of the period
|
|
|
|
|
|
||||
|
Current service cost
|
|
|
|
|
|
||||
|
Interest cost on DBO
|
|
|
|
|
|
||||
|
Past service cost - Plan amendments
|
(
|
|
|
(
|
|
||||
|
Past service cost - Curtailments
|
(
|
|
|
(
|
|
||||
|
Past service cost - Settlements
|
(
|
|
|
(
|
(
|
||||
|
Plan participants’ contribution
|
|
|
|
|
|
||||
|
Actuarial (gain) loss
|
(
|
|
(
|
(
|
(
|
||||
|
Demographic assumptions
|
|
|
|
|
|
||||
|
Financial assumptions
|
(
|
|
(
|
(
|
(
|
||||
|
Experience adjustment
|
|
(
|
|
(
|
(
|
||||
|
Benefits paid
|
(
|
(
|
(
|
(
|
(
|
||||
|
Foreign currency exchange rate differences and other movements
|
(
|
(
|
(
|
(
|
(
|
||||
|
Benefit obligation at end of the period
|
|
|
|
|
|
||||
|
Change in plan assets
|
|||||||||
|
Fair value of plan assets at beginning of the period
|
|
|
|
|
|
||||
|
Interest income on plan assets
|
|
|
|
|
|
||||
|
Return on plan assets less than discount rate
|
|
|
(
|
|
—
|
||||
|
Employer contribution
|
|
|
|
|
|
||||
|
Plan participants’ contribution
|
|
|
|
|
|
||||
|
Past service cost - Settlements
|
(
|
|
|
|
(
|
||||
|
Benefits paid
|
(
|
(
|
(
|
(
|
(
|
||||
|
Foreign currency exchange rate differences and other movements
|
(
|
(
|
(
|
(
|
|
||||
|
Fair value of plan assets at end of the period
|
|
|
|
|
|
||||
|
Present value of the wholly or partly funded obligation
|
(
|
(
|
(
|
(
|
(
|
||||
|
Fair value of plan assets
|
|
|
|
|
|
||||
|
Net present value of the wholly or partly funded obligation
|
(
|
|
(
|
(
|
(
|
||||
|
Present value of the unfunded obligation
|
(
|
(
|
|
(
|
(
|
||||
|
Prepaid due to unrecoverable surpluses
|
(
|
(
|
(
|
(
|
|
||||
|
Net amount recognized
|
(
|
|
(
|
(
|
(
|
||||
|
Net assets related to funded obligations
|
|
|
|
|
|
||||
|
Recognized liabilities
|
(
|
(
|
(
|
(
|
(
|
||||
|
Change in unrecoverable surplus
|
|||||||||
|
Unrecoverable surplus at beginning of the period
|
(
|
(
|
(
|
(
|
|
||||
|
Interest cost on unrecoverable surplus
|
(
|
(
|
|
|
|
||||
|
Change in unrecoverable surplus in excess of interest
|
(
|
(
|
|
|
|
||||
|
Exchange rates changes
|
|
|
|
|
|
||||
|
Unrecoverable surplus at end of the period
|
(
|
(
|
(
|
(
|
|
||||
276
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
Year ended December 31, 2023
|
|||||||||
|
Total
|
Canada
|
Brazil
|
Europe
|
Other
|
|||||
|
Change in benefit obligation
|
|||||||||
|
Benefit obligation at beginning of the period
|
|
|
|
|
|
||||
|
Current service cost
|
|
|
|
|
|
||||
|
Interest cost on DBO
|
|
|
|
|
|
||||
|
Past service cost - Plan amendments
|
|
|
|
|
|
||||
|
Past service cost - Curtailments
|
(
|
|
|
(
|
|
||||
|
Plan participants’ contribution
|
|
|
|
|
|
||||
|
Actuarial (gain) loss
|
|
|
|
|
|
||||
|
Demographic assumptions
|
|
|
|
|
|
||||
|
Financial assumptions
|
|
|
|
|
|
||||
|
Experience adjustment
|
|
|
|
(
|
|
||||
|
Benefits paid
|
(
|
(
|
(
|
(
|
(
|
||||
|
Divestments (note 2.3.1)
|
(
|
|
|
|
(
|
||||
|
Foreign currency exchange rate differences and other movements
|
|
|
|
|
|
||||
|
Benefit obligation at end of the period
|
|
|
|
|
|
||||
|
Change in plan assets
|
|||||||||
|
Fair value of plan assets at beginning of the period
|
|
|
|
|
|
||||
|
Interest income on plan assets
|
|
|
|
|
|
||||
|
Return on plan assets less than discount rate
|
|
|
|
|
|
||||
|
Employer contribution
|
|
|
|
|
|
||||
|
Plan participants’ contribution
|
|
|
|
|
|
||||
|
Benefits paid
|
(
|
(
|
(
|
(
|
(
|
||||
|
Foreign currency exchange rate differences and other movements
|
|
|
|
|
|
||||
|
Fair value of plan assets at end of the period
|
|
|
|
|
|
||||
|
Present value of the wholly or partly funded obligation
|
(
|
(
|
(
|
(
|
(
|
||||
|
Fair value of plan assets
|
|
|
|
|
|
||||
|
Net present value of the wholly or partly funded obligation
|
(
|
|
(
|
(
|
(
|
||||
|
Present value of the unfunded obligation
|
(
|
(
|
|
(
|
(
|
||||
|
Prepaid due to unrecoverable surpluses
|
(
|
(
|
(
|
(
|
|
||||
|
Net amount recognized
|
(
|
(
|
(
|
(
|
(
|
||||
|
Net assets related to funded obligations
|
|
|
|
|
|
||||
|
Recognized liabilities
|
(
|
(
|
(
|
(
|
(
|
||||
|
Change in unrecoverable surplus
|
|||||||||
|
Unrecoverable surplus at beginning of the period
|
(
|
(
|
(
|
(
|
|
||||
|
Interest cost on unrecoverable surplus
|
(
|
(
|
|
|
|
||||
|
Change in unrecoverable surplus in excess of interest
|
|
|
|
|
|
||||
|
Exchange rates changes
|
(
|
|
(
|
|
|
||||
|
Unrecoverable surplus at end of the period
|
(
|
(
|
(
|
(
|
|
||||
277
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
|
Year ended December 31, 2024
|
||||||||
|
Net periodic pension cost (income)
|
Total
|
Canada
|
Brazil
|
Europe
|
Others
|
||||
|
Current service cost
|
|
|
|
|
|
||||
|
Past service cost - Plan amendments
|
(
|
|
|
(
|
|
||||
|
Past service cost - Curtailments
|
(
|
|
|
(
|
|
||||
|
Past service cost - Settlements
|
(
|
|
|
(
|
|
||||
|
Net interest cost (income) on net DB liability (asset)
|
|
|
|
|
|
||||
|
Total
|
|
|
|
|
|
||||
|
|
Year ended December 31, 2023
|
||||||||
|
Net periodic pension cost (income)
|
Total
|
Canada
|
Brazil
|
Europe
|
Others
|
||||
|
Current service cost
|
|
|
|
|
|
||||
|
Past service cost - Plan amendments
|
|
|
|
|
|
||||
|
Past service cost - Curtailments
|
(
|
|
|
(
|
|
||||
|
Net interest cost (income) on net DB liability (asset)
|
|
|
|
|
|
||||
|
Total
|
|
|
|
|
|
||||
|
|
Year ended December 31, 2022
|
||||||||
|
Net periodic pension cost (income)
|
Total
|
Canada
|
Brazil
|
Europe
|
Others
|
||||
|
Current service cost
|
|
|
|
|
|
||||
|
Past service cost - Plan amendments
|
|
|
|
(
|
|
||||
|
Past service cost - Curtailments
|
(
|
|
|
(
|
|
||||
|
Net interest cost (income) on net DB liability (asset)
|
|
|
|
|
|
||||
|
Total
|
|
|
|
|
|
||||
Other post-employment benefits and other long-term employee
benefits ("OPEB")
This section includes post-employment employees benefits that
are not disclosed above (i.e. includes lump sum benefits which
are mandatory by law, medical insurance and life insurance). In
addition, this section includes all other long-term employee
benefits.
ArcelorMittal’s principal operating subsidiaries in Canada,
Europe and certain other countries, provide other post-
employment benefits and other long-term employee benefits,
including medical benefits and life insurance benefits, work
medals and retirement indemnity plans, to employees and
retirees.
278
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
Year ended December 31, 2024
|
|||||||
|
Total
|
Canada
|
Europe
|
Others
|
||||
|
Change in benefit obligation
|
|||||||
|
Benefit obligation at beginning of the period
|
|
|
|
|
|||
|
Current service cost
|
|
|
|
|
|||
|
Interest cost on DBO
|
|
|
|
|
|||
|
Past service cost - Plan amendments
|
(
|
|
(
|
(
|
|||
|
Past service cost - Curtailments
|
(
|
|
(
|
|
|||
|
Actuarial (gain) loss
|
|
|
(
|
|
|||
|
Demographic assumptions
|
|
|
|
|
|||
|
Financial assumptions
|
(
|
|
(
|
|
|||
|
Experience adjustment
|
(
|
(
|
(
|
|
|||
|
Benefits paid
|
(
|
(
|
(
|
(
|
|||
|
Foreign currency exchange rate differences and other movements
|
(
|
(
|
(
|
(
|
|||
|
Benefit obligation at end of the period
|
|
|
|
|
|||
|
Change in plan assets
|
|||||||
|
Fair value of plan assets at beginning of the period
|
|
|
|
|
|||
|
Fair value of plan assets at end of the period
|
|
|
|
|
|||
|
Present value of the wholly or partly funded obligation
|
(
|
|
(
|
|
|||
|
Fair value of plan assets
|
|
|
|
|
|||
|
Net present value of the wholly or partly funded obligation
|
(
|
|
(
|
|
|||
|
Present value of the unfunded obligation
|
(
|
(
|
(
|
(
|
|||
|
Net amount recognized
|
(
|
(
|
(
|
(
|
|||
279
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
Year ended December 31, 2023
|
|||||||
|
Total
|
Canada
|
Europe
|
Others
|
||||
|
Change in benefit obligation
|
|||||||
|
Benefit obligation at beginning of the period
|
|
|
|
|
|||
|
Current service cost
|
|
|
|
|
|||
|
Interest cost on DBO
|
|
|
|
|
|||
|
Past service cost - Plan amendments
|
|
|
(
|
|
|||
|
Actuarial (gain) loss
|
|
|
|
(
|
|||
|
Demographic assumptions
|
|
|
|
|
|||
|
Financial assumptions
|
|
|
|
(
|
|||
|
Experience adjustment
|
|
(
|
|
(
|
|||
|
Benefits paid
|
(
|
(
|
(
|
(
|
|||
|
Foreign currency exchange rate differences and other movements
|
|
|
|
|
|||
|
Benefit obligation at end of the period
|
|
|
|
|
|||
|
Change in plan assets
|
|||||||
|
Fair value of plan assets at beginning of the period
|
|
|
|
|
|||
|
Benefits paid
|
(
|
|
(
|
|
|||
|
Fair value of plan assets at end of the period
|
|
|
|
|
|||
|
Present value of the wholly or partly funded obligation
|
(
|
|
(
|
|
|||
|
Fair value of plan assets
|
|
|
|
|
|||
|
Net present value of the wholly or partly funded obligation
|
(
|
|
(
|
|
|||
|
Present value of the unfunded obligation
|
(
|
(
|
(
|
(
|
|||
|
Net amount recognized
|
(
|
(
|
(
|
(
|
|||
280
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
|
Year ended December 31, 2024
|
||||||
|
Components of net periodic OPEB cost (income)
|
Total
|
Canada
|
Europe
|
Others
|
|||
|
Current service cost
|
|
|
|
|
|||
|
Past service cost - Plan amendments
|
(
|
|
(
|
(
|
|||
|
Past service cost - Curtailments
|
(
|
|
(
|
|
|||
|
Net interest cost (income) on net DB liability (asset)
|
|
|
|
|
|||
|
Actuarial gain recognized during the year
|
(
|
|
(
|
|
|||
|
Total
|
|
|
|
|
|||
|
|
Year ended December 31, 2023
|
||||||
|
Components of net periodic OPEB cost (income)
|
Total
|
Canada
|
Europe
|
Others
|
|||
|
Current service cost
|
|
|
|
|
|||
|
Past service cost - Plan amendments
|
|
|
(
|
|
|||
|
Net interest cost (income) on net DB liability (asset)
|
|
|
|
|
|||
|
Actuarial loss recognized during the year
|
|
|
|
|
|||
|
Total
|
|
|
|
|
|||
|
|
Year ended December 31, 2022
|
||||||
|
Components of net periodic OPEB cost (income)
|
Total
|
Canada
|
Europe
|
Others
|
|||
|
Current service cost
|
|
|
|
|
|||
|
Net interest cost (income) on net DB liability (asset)
|
|
|
|
|
|||
|
Actuarial gain recognized during the year
|
(
|
|
(
|
|
|||
|
Total
|
|
|
|
|
|||
|
|
Year ended December 31,
|
||||
|
|
2024
|
2023
|
2022
|
||
|
Net periodic pension cost
|
|
|
|
||
|
Net periodic OPEB cost
|
|
|
|
||
|
Total
|
|
|
|
||
|
Cost of sales
|
|
|
|
||
|
Selling, general and administrative expenses
|
|
|
|
||
|
Financing costs - net
|
|
|
|
||
|
Total
|
|
|
|
||
281
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
Plan Assets
|
|
December 31, 2024
|
||||||
|
Canada
|
Brazil
|
Europe
|
|||||
|
Equity Securities
|
|
|
|
||||
|
- Asset classes that have a quoted market price in an active market
|
|
|
|
||||
|
- Asset classes that do not have a quoted market price in an active market
|
|
|
|
||||
|
Fixed Income Securities (including cash)
|
|
|
|
||||
|
- Asset classes that have a quoted market price in an active market
|
|
|
|
||||
|
- Asset classes that do not have a quoted market price in an active market
|
|
|
|
||||
|
Real Estate
|
|
|
|
||||
|
- Asset classes that have a quoted market price in an active market
|
|
|
|
||||
|
- Asset classes that do not have a quoted market price in an active market
|
|
|
|
||||
|
Other
|
|
|
|
||||
|
- Asset classes that have a quoted market price in an active market
|
|
|
|
'
1
|
|||
|
- Asset classes that do not have a quoted market price in an active market
|
|
|
|
||||
|
Total
|
|
|
|
||||
|
|
December 31, 2023
|
||||||
|
Canada
|
Brazil
|
Europe
|
|||||
|
Equity Securities
|
|
|
|
||||
|
- Asset classes that have a quoted market price in an active market
|
|
|
|
||||
|
- Asset classes that do not have a quoted market price in an active market
|
|
|
|
||||
|
Fixed Income Securities (including cash)
|
|
|
|
||||
|
- Asset classes that have a quoted market price in an active market
|
|
|
|
||||
|
- Asset classes that do not have a quoted market price in an active market
|
|
|
|
||||
|
Real Estate
|
|
|
|
||||
|
- Asset classes that have a quoted market price in an active market
|
|
|
|
||||
|
- Asset classes that do not have a quoted market price in an active market
|
|
|
|
||||
|
Other
|
|
|
|
||||
|
- Asset classes that have a quoted market price in an active market
|
|
|
|
'
1
|
|||
|
- Asset classes that do not have a quoted market price in an active market
|
|
|
|
||||
|
Total
|
|
|
|
||||
1.
The percentage consists primarily of assets from insurance contracts in Belgium and Canada.
These assets do not include direct investments in ArcelorMittal stock or ArcelorMittal bonds. They may include ArcelorMittal shares or
bonds held by mutual fund investments. The invested assets produced a
235
and
404
actual return in 2024 and 2023, respectively.
The Finance and Retirement Committees of the Boards of Directors for the respective operating subsidiaries have general supervisory
authority over the respective trust funds. These committees usually establish, monitor and review asset allocation targets for the
respective funds. Asset managers are permitted some flexibility to vary the asset allocation from the long-term investment strategy
within agreed upon control ranges. The established targets observed as of December 31,
2024
are as described below:
282
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
December 31, 2024
|
|||||||
|
|
Canada
|
Brazil
|
Europe
|
||||
|
Equity Securities
|
|
|
|
||||
|
Fixed Income Securities (including cash)
|
|
|
|
||||
|
Real Estate
|
|
|
|
'
1
|
|||
|
Other
'
|
|
|
|
||||
|
Total
|
|
|
|
||||
1.
The percentage consists primarily of assets from insurance contracts in Belgium and Canada.
|
|
Pension Plans
|
Other Post-employment Benefits
|
|||||||||
|
|
2024
|
2023
|
2022
|
2024
|
2023
|
2022
|
|||||
|
Discount rate
|
|
|
|
|
|
|
|||||
|
Range
|
|
|
|
|
|
|
|||||
|
Weighted average
|
|
|
|
|
|
|
|||||
|
Rate of compensation increase
|
|
|
|
||||||||
|
Range
|
|
|
|
|
|
|
|||||
|
Weighted average
|
|
|
|
|
|
|
|||||
|
|
Other Post-employment Benefits
|
||||
|
|
2024
|
2023
|
2022
|
||
|
Healthcare cost trend rate assumed
|
|
|
|
||
|
Range
|
|
|
|
||
|
Weighted average
|
|
|
|
||
Cash contributions and maturity profile of the plans
In 2025, the Company expects its cash contributions to amount
to
178
for pension plans,
63
for other post-employment benefits
plans and
129
for defined contribution plans. In 2024 and 2023,
cash contributions to defined contributions plans were
107
and
At December 31, 2024 and December 31, 2023, the weighted
average duration of liabilities related to pension and other post-
employment benefits plans remained unchanged at
10
years
and
11
years
, respectively.
Risks associated with defined benefit plans
Through its defined benefit pension plans and OPEB plans,
ArcelorMittal is exposed to a number of risks, the most
significant of which are detailed below:
Changes in bond yields
An increase in corporate bond yields will decrease plan
liabilities, however it will decrease simultaneously the value of
the plans’ bond holdings.
Asset volatility
The plan liabilities are calculated using a discount rate set with
reference to corporate bond yields; if plan assets underperform
this yield, this will create a deficit. In most countries with funded
plans, plan assets hold a significant portion of equities, which
are expected to outperform corporate bonds in the long-term but
contribute to volatility and risk in the short-term. As the plans
mature, ArcelorMittal intends to reduce the level of investment
risk by investing more in assets that better match the liabilities.
However, ArcelorMittal believes that due to the long-term nature
of the plan liabilities, a level of continuing equity investment is
an appropriate element of a long-term strategy to manage the
plans efficiently.
Life expectancy
Most plans provide benefits for the life of the covered members,
so increases in life expectancy will result in an increase in the
plans’ benefit obligations.
283
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
Assumptions regarding future mortality rates have been set
considering published statistics and, where possible,
ArcelorMittal’s own experience.
The current longevity at retirement underlying the values of the
defined benefit obligation was approximately
23
years
.
Healthcare cost trend rate
The majority of the OPEB plans’ benefit obligations are linked to
the change in the cost of various health care components.
Future healthcare cost will vary based on several factors
including price inflation, utilization rate, technology advances,
cost shifting and cost containing mechanisms. A higher
healthcare cost trend would lead to higher OPEB plan benefit
obligations.
Sensitivity analysis
plans (as of December 31, 2024, the defined benefit obligation for pension plans was
4,614
):
|
Effect on 2025 Pre-Tax Pension Expense
(sum of service cost and interest cost)
|
Effect on December 31, 2024 DBO
|
||
|
Change in assumption
|
|
|
|
|
|
(
|
|
|
|
|
|
(
|
|
|
|
(
|
(
|
|
|
|
|
|
|
|
|
|
|
The following table illustrates the sensitivity to a change of the significant actuarial assumptions related to ArcelorMittal’s OPEB plans
(as of December 31, 2024 the defined benefit obligation for post-employment benefit plans was
888
):
|
Effect on 2025 Pre-Tax OPEB Expense
(sum of service cost and interest cost)
|
Effect on December 31, 2024 DBO
|
||
|
Change in assumption
|
|
|
|
|
|
(
|
|
|
|
|
|
(
|
|
|
|
(
|
(
|
|
|
|
|
|
|
|
|
|
|
The above sensitivities reflect the effect of changing one
assumption at a time. Actual economic factors and conditions
often affect multiple assumptions simultaneously, and the effects
of changes in key assumptions are not necessarily linear.
certain employees which are RSUs and PSUs. Equity-settled
share-based payments are measured at fair value (excluding
the effect of non market-based vesting conditions) at the grant
date. The fair value determined at the grant date of the equity-
settled share-based payments is expensed on a graded
vesting
basis over the vesting period, based on the Company’s
estimate of the shares that will eventually vest and adjusted for
the effect of non market-based vesting conditions. Where the
fair value calculation requires modeling of the Company’s
performance against other market index, fair value is measured
using the Monte Carlo pricing model to estimate the forecasted
target performance goal for the company and its peer
companies. The expected life used in the model has been
adjusted, based on management’s best estimate, for the effects
of non-transferability, exercise restrictions and behavioral
considerations. In addition, the expected annualized volatility
has been set by reference to the implied volatility of options
available on ArcelorMittal shares in the open market, as well as,
historical patterns of volatility. The fair value determined at the
grant date of the equity-settled share-based payments is
284
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
ArcelorMittal Equity Incentive Plan
ArcelorMittal operates a long-term incentive plan ("the
ArcelorMittal Equity Incentive Plan") to incentivize shareholder
wealth creation in excess of performance of a peer group and
incentivize executives to achieve strategy. The ArcelorMittal
Equity Incentive Plan is intended to align the interests of the
Company’s shareholders and eligible employees by allowing
them to participate in the success of the Company. The
ArcelorMittal Equity Incentive Plan provides for the grant of
RSUs and PSUs to eligible employees of the Company
(including Executive Officers) and is designed to incentivize
employees, improve the Company’s long-term performance and
retain key employees.
The grant of PSUs under the ArcelorMittal Equity Incentive Plan
aims to serve as an effective performance-enhancing scheme
based on the employee’s contribution to the eligible
achievement of the Company’s strategy. Awards in connection
with PSUs are subject to the fulfillment of cumulative
performance criteria over a
three
-year
period from the date of
the PSU grant such as return on capital employed ("ROCE"),
total shareholders return ("TSR"), earnings per share ("EPS")
and gap to competition (until 2022). Performance criteria also
include a set of
three
weighted environmental, social and
governance ("ESG") indicators representing
30
%
and
20
%
award vesting for the Executive Office and Executive Officers,
respectively, including health & safety, climate action and
diversity & inclusion ("D&I"). For health & safety (
10
%
award
vesting for both Executive Office and Executive Officers), the
target is to halve the fatality frequency rate versus a defined
baseline (the baseline is the adjusted average frequency rate
over
5
years
before the grant). For D&I (
10
%
and
5
%
award
vesting for Executive Office and Executive Officers,
respectively), the target is to reduce by
40
%
the gap between
the Company's 2030 target of having
25
%
women in
management and 2020 baseline. For climate (
10
%
and
5
%
award vesting for Executive Office and Executive Officers,
respectively), the
CO
2
emission target has been set to be
reached by the end of the vesting period. The employees
eligible to receive PSUs are a sub-set of the group of employees
eligible to receive RSUs.
RSUs granted under the ArcelorMittal Equity Incentive Plan are
designed to provide a retention incentive to eligible employees.
RSUs are subject to “cliff vesting” after
3
years
, with
100
%
of
the grant vesting on the third anniversary of the grant contingent
upon the continued active employment of the eligible employee
within the Company.
The maximum number of PSUs and RSUs available for grant
during any given year is subject to the prior approval of the
Company’s shareholders at the AGM. The 2021, 2022, 2023
and 2024 Caps for the number of PSUs/RSUs that may be
allocated to the Executive Office and other retention and
performance based grants below the Executive Office level,
were approved at the AGMs on June 8, 2021, May 4, 2022, May
2, 2023 and April 30, 2024, respectively, at a maximum of
285
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
Executive Office
|
Executive Officers
|
||||||||||||
|
2024
Grant
|
l
|
PSUs with a
three
year performance period
|
l
|
PSUs with a
three
year performance period
|
|||||||||
|
l
|
Value at grant
Chairman and the CEO
|
||||||||||||
|
l
|
Vesting conditions:
|
l
|
Vesting conditions:
|
||||||||||
|
Target
|
Stretch
|
Ceiling
|
Threshold
|
Target
|
Stretch
|
Ceiling
|
|||||||
|
TSR vs. peer group
(
group (
|
weighted
average
|
weighted
average
|
≥
weighted
average
|
TSR vs. peer group
(
|
rolling
average
|
rolling
average
|
rolling
average
|
≥
rolling
average
|
|||||
|
Vesting percentage
|
|
|
|
Vesting percentage
|
|
|
|
|
|||||
|
ROCE (
|
2/3 of
target
|
target
|
4/3 of
target
|
target
|
|||||||||
|
ESG (
Climate action
D&I
|
target
|
target
|
≥
target
|
Vesting percentage
|
|
|
|
|
|||||
|
Vesting percentage
|
|
|
|
ESG (
Climate action
D&I
|
weighted
average
|
target
|
target
|
target
|
|||||
|
Vesting percentage
|
|
|
|
|
|||||||||
|
l
|
RSUs with a
three
year vesting period
|
||||||||||||
Awards made in previous financial years which have not yet reached the end of the vesting period
ArcelorMittal's Equity Incentive Plan for senior management including Executive Officers follows the Company's strategy.
In addition to
the 2024 grant, t
he summary of outstanding plans as of December 31, 2024 is as follo
ws:
|
Executive Office
|
Executive Officers
|
|||||||||
|
2021
Grant
|
l
|
PSUs with a
three
year performance period
|
l
|
PSUs with a
three
year performance period
|
||||||
|
l
|
Value at grant
the CEO
|
|||||||||
|
l
|
Vesting conditions:
|
l
|
Vesting conditions:
|
|||||||
|
Threshold
|
Target
|
Target
|
Stretch
|
|||||||
|
TSR vs. peer group (
vs. peer group (
|
|
≥
|
TSR vs. peer group (
|
weighted
average
|
≥
weighted
average
|
|||||
|
Vesting percentage
|
|
|
Vesting percentage
|
|
|
|||||
|
Gap to competition (
|
|
|
||||||||
|
ESG (
|
|
Vesting percentage
|
|
|
||||||
|
ESG
|
|
|
||||||||
|
Vesting percentage
|
|
|
|
|||||||
|
l
|
RSUs with a
three
year vesting period
|
|||||||||
|
l
|
RSUs with a
two
year vesting period
|
|||||||||
286
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
Executive Office
|
Executive Officers
|
||||||||||
|
2022
Grant
|
l
|
PSUs with a
three
year performance period
|
l
|
PSUs with a
three
year performance period
|
|||||||
|
l
|
Value at grant
the CEO
|
||||||||||
|
l
|
Vesting conditions:
|
l
|
Vesting conditions
|
||||||||
|
Threshold
|
Target
|
Target
|
Stretch
|
||||||||
|
TSR vs. peer group (
vs. peer group (
|
weighted
average
|
≥
weighted
average
|
TSR vs. peer group
(
|
weighted
average
|
≥
weighted
average
|
||||||
|
Vesting percentage
|
|
|
Vesting percentage
|
|
|
||||||
|
Gap to competition (
|
target
|
target
|
|||||||||
|
ESG (
action
|
|
|
Vesting percentage
|
|
|
||||||
|
ESG (
action
|
target
|
target
|
|||||||||
|
Vesting percentage
|
|
|
Vesting percentage
|
|
|
||||||
|
l
|
RSUs with a
three
year vesting period
|
||||||||||
|
Executive Office
|
Executive Officers
|
||||||||||
|
2023
Grant
|
l
|
PSUs with a
three
year performance period
|
l
|
PSUs with a
three
year performance period
|
|||||||
|
l
|
Value at grant
the CEO
|
||||||||||
|
l
|
Vesting conditions:
|
l
|
Vesting conditions:
|
||||||||
|
Target
|
Stretch
|
Threshold
|
Target
|
Stretch
|
|||||||
|
TSR vs. peer group (
vs. peer group (
|
weighted
average
|
≥
weighted
average
|
TSR vs. peer group
(
|
—
|
weighted
average
|
≥
weighted
average
|
|||||
|
Vesting percentage
|
|
|
Vesting percentage
|
—
|
|
|
|||||
|
ROCE (
|
2/3 of
target
|
target
|
4/3 of
target
|
||||||||
|
ESG (
action
|
|
|
Vesting percentage
|
|
|
|
|||||
|
ESG (
Climate action
D&I
|
—
|
target
|
target
|
||||||||
|
Vesting percentage
|
|
|
Vesting percentage
|
—
|
|
|
|||||
|
l
|
RSUs with a
three
year vesting period
|
||||||||||
287
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
At Grant date
|
Number of PSUs/RSUs issued as of
December 31, 2024
|
|||||||||||||||
|
Grant date
|
Type of plan
|
Number of
PSUs/RSUs
|
Number of
beneficiaries
|
Maturity
|
Fair value
per PSU/
RSU
|
PSUs/
RSUs
outstanding
|
PSUs/
RSUs
forfeited
|
PSUs/
RSUs
vested
|
||||||||
|
December 5, 2024
|
RSU
|
|
|
December 5, 2027
|
|
|
|
|
||||||||
|
December 5, 2024
|
PSU
|
|
|
January 1, 2028
|
|
|
|
|
||||||||
|
December 5, 2024
|
Executive Office
|
|
|
January 1, 2028
|
|
|
|
|
||||||||
|
December 8, 2023
|
RSU
|
|
|
December 8, 2026
|
|
|
|
|
||||||||
|
December 8, 2023
|
PSU
|
|
|
January 1, 2027
|
|
|
|
|
||||||||
|
December 8, 2023
|
Executive Office
|
|
|
January 1, 2027
|
|
|
|
|
||||||||
|
December 13, 2022
|
RSU
|
|
|
December 13,
2025
|
|
|
|
|
||||||||
|
December 13, 2022
|
PSU
|
|
|
January 1, 2026
|
|
|
|
|
||||||||
|
December 13, 2022
|
Executive Office
|
|
|
January 1, 2026
|
|
|
|
|
||||||||
|
December 16, 2021
|
PSU
|
|
|
January 1, 2025
|
|
|
|
|
||||||||
|
December 16, 2021
|
Executive Office
|
|
|
January 1, 2025
|
|
|
|
|
||||||||
|
Total
|
|
$
$
|
|
|
|
|||||||||||
The compensation expense recognized for PSUs and RSUs
was
37
,
39
and
38
for the years ended
December 31, 2024
,
2023
and
2022
, respectively.
year
ended December 31, 2024,
2023
and
2022
:
|
RSUs
|
PSUs and Executive
Office
|
||||||
|
Number of
RSUs
|
Fair
value
per
RSU
|
Number of
PSUs
|
Fair
value
per
PSU
|
||||
|
Outstanding, December 31,
2021
|
|
|
|
|
|||
|
Granted
|
|
|
|
|
|||
|
Exited
|
(
|
|
(
|
|
|||
|
Forfeited
|
(
|
|
(
|
|
|||
|
Outstanding, December 31,
2022
|
|
|
|
|
|||
|
Granted
|
|
|
|
|
|||
|
Exited
|
(
|
|
(
|
|
|||
|
Forfeited
|
(
|
|
(
|
|
|||
|
Outstanding, December 31,
2023
|
|
|
|
|
|||
|
Granted
|
|
|
|
|
|||
|
Exited
|
(
|
|
(
|
|
|||
|
Forfeited
|
(
|
|
(
|
|
|||
|
Outstanding, December 31,
2024
|
|
|
|
|
|||
COMMITMENTS
losses that have been incurred when it has a present legal or
constructive obligation as a result of past events, it is probable
that the Company will be required to settle the obligation and a
reliable estimate of the amount of the obligation can be made. If
the effect of the time value of money is material, provisions are
discounted using a current pre-tax rate that reflects, where
appropriate, the risks specific to the liability. Where discounting
is used, the increase in the provision due to the passage of time
is recognized as a financing cost. Future operating expenses or
losses are excluded from recognition as provisions as they do
not meet the definition of a liability. Contingent assets and
contingent liabilities are excluded from recognition in the
consolidated statements of financial position.
Provisions for onerous contracts are recorded in the
consolidated statements of operations when it becomes known
that the unavoidable costs of meeting the obligations under the
contract exceed the economic benefits expected to be received.
Assets dedicated to the onerous contracts are tested for
impairment before recognizing a separate provision for the
onerous contract.
Provisions for restructuring are recognized when and only when
a detailed formal plan exists and a valid expectation in those
affected by the restructuring has been raised, by starting to
implement the plan or announcing its main features.
288
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
ArcelorMittal records asset retirement obligations (“ARO”)
initially at the fair value of the legal or constructive obligation in
the period in which it is incurred and capitalizes the ARO by
increasing the carrying amount of the related non-current asset.
The fair value of the obligation is determined as the discounted
value of the expected future cash flows. The liability is accreted
to its present value through net financing cost and the
capitalized cost is depreciated in accordance with the
Company’s depreciation policies for property, plant and
equipment. Subsequently, when reliably measurable, ARO is
recorded on the consolidated statements of financial position
increasing the cost of the asset and the fair value of the related
obligation. Foreign exchange gains or losses on AROs
denominated in foreign currencies are recorded in the
consolidated statements of operations.
ArcelorMittal is subject to changing and increasingly stringent
environmental laws and regulations concerning air emissions,
water discharges and waste disposal, as well as certain
remediation activities that involve the clean-up of soil and
groundwater. ArcelorMittal is currently engaged in the
investigation and remediation of environmental contamination at
a number of its facilities. Most of these are legacy obligations
arising from acquisitions.
Environmental costs that relate to current operations or to an
existing condition caused by past operations, and which do not
contribute to future revenue generation or cost reduction, are
expensed. Liabilities are recorded when environmental
assessments and/or remedial efforts are probable and the cost
can be reliably estimated based on ongoing engineering studies,
discussions with the environmental authorities and other
assumptions relevant to the nature and extent of the
remediation that may be required. The ultimate cost to
ArcelorMittal is dependent upon factors beyond its control such
as the scope and methodology of the remedial action
requirements to be established by environmental and public
health authorities, new laws or government regulations, rapidly
changing technology and the outcome of any potential related
litigation. Environmental liabilities are discounted if the
aggregate amount of the obligation and the amount and timing
of the cash payments are fixed or reliably determinable.
The estimates of loss contingencies for environmental matters
and other contingencies are based on various judgments and
assumptions including the likelihood, nature, magnitude and
timing of assessment, remediation and/or monitoring activities
and the probable cost of these activities. In some cases,
judgments and assumptions are made relating to the obligation
or willingness and ability of third parties to bear a proportionate
or allocated share of cost of these activities, including third
parties who sold assets to ArcelorMittal or purchased assets
from it subject to environmental liabilities. ArcelorMittal also
considers, among other things, the activity to date at particular
sites, information obtained through consultation with applicable
regulatory authorities and third-party consultants and
contractors and its historical experience with other
circumstances judged to be comparable. Due to the numerous
variables associated with these judgments and assumptions,
and the effects of changes in governmental regulation and
environmental technologies, both the precision and reliability of
the resulting estimates of the related contingencies are subject
to substantial uncertainties. As estimated costs to remediate
change, the Company will reduce or increase the recorded
liabilities through write backs or additional provisions in the
consolidated statements of operations. ArcelorMittal does not
expect these environmental issues to affect the utilization of its
plants, now or in the future.
ArcelorMittal is currently and may in the future be involved in
litigation, arbitration or other legal proceedings. Provisions
related to legal and arbitration proceedings are recorded in
accordance with the principles described above.
Most of these claims involve highly complex issues. Often these
issues are subject to substantial uncertainties and, therefore,
the probability of loss and an estimation of damages are difficult
to ascertain. Consequently, ArcelorMittal may be unable to make
a reliable estimate of the expected financial effect that will result
from ultimate resolution of the proceeding. In those cases,
ArcelorMittal has disclosed information with respect to the
nature of the contingency. ArcelorMittal has not accrued a
provision for the potential outcome of these cases.
For cases in which the Company was able to make a reliable
estimate of the expected loss or range of probable loss and has
accrued a provision for such loss, it believes that publication of
this information on a case-by-case basis would seriously
prejudice the Company’s position in the ongoing legal
proceedings or in any related settlement discussions.
Accordingly, in these cases, the Company has disclosed
information with respect to the nature of the contingency, but
has not disclosed its estimate of the range of potential loss.
In the cases in which quantifiable fines and penalties have been
assessed, the Company has indicated the amount of such fine
or penalty or the amount of provision accrued that is the
estimate of the probable loss.
These assessments can involve a series of complex judgments
about future events and can rely heavily on estimates and
assumptions. The assessments are based on estimates and
assumptions that have been deemed reasonable by
management. The Company believes that the aggregate
provisions recorded for the above matters are adequate based
upon currently available information. However, given the
inherent uncertainties related to these cases and in estimating
contingent liabilities, the Company could, in the future, incur
289
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
judgments that have a material adverse effect on its results of
operations in any particular period. The Company considers it
highly unlikely, however, that any such judgments could have a
|
Balance at
December 31,
2023
|
Additions
1
|
Deductions/
Payments
|
Effects of foreign
exchange and
other movements
|
Balance at
December 31,
2024
|
|||||
|
Environmental
|
|
|
(
|
(
|
|
||||
|
Emission obligations
|
|
|
(
|
(
|
|
||||
|
Asset retirement obligations
|
|
|
(
|
(
|
|
||||
|
Site restoration
|
|
|
(
|
(
|
|
||||
|
Staff related obligations
|
|
|
(
|
(
|
|
||||
|
Voluntary separation plans
|
|
|
(
|
|
|
||||
|
Litigation and other (see note 9.3)
|
|
|
(
|
(
|
|
||||
|
Tax claims
|
|
|
(
|
(
|
|
||||
|
Other legal claims
|
|
|
(
|
(
|
|
||||
|
Commercial agreements and onerous contracts
|
|
|
(
|
(
|
|
||||
|
Other
|
|
|
(
|
(
|
|
||||
|
|
|
(
|
(
|
|
|||||
|
Short-term provisions
|
|
|
|||||||
|
Long-term provisions
|
|
|
|||||||
|
|
|
|
Balance at
December 31,
2022
|
Additions
1
|
Deductions/
Payments
|
Effects of foreign
exchange and
other movements
|
Balance at
December 31,
2023
|
|||||
|
Environmental
|
|
|
(
|
|
|
||||
|
Emission obligations
|
|
|
(
|
(
|
|
||||
|
Asset retirement obligations
|
|
|
(
|
|
|
||||
|
Site restoration
|
|
|
(
|
|
|
||||
|
Staff related obligations
|
|
|
(
|
|
|
||||
|
Voluntary separation plans
|
|
|
(
|
|
|
||||
|
Litigation and other (see note 9.3)
|
|
|
(
|
|
|
||||
|
Tax claims
|
|
|
(
|
|
|
||||
|
Other legal claims
|
|
|
(
|
|
|
||||
|
Commercial agreements and onerous
contracts
|
|
|
(
|
|
|
||||
|
Other
|
|
|
(
|
|
|
||||
|
|
|
(
|
|
|
|||||
|
Short-term provisions
|
|
|
|||||||
|
Long-term provisions
|
|
|
|||||||
|
|
|
290
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
There are uncertainties regarding the timing and amount of the
provisions above. Changes in underlying facts and
circumstances for each provision could result in differences in
the amounts provided for and the actual outflows. In general,
provisions are presented on a non-discounted basis due to the
uncertainties regarding the timing or the short period of their
expected consumption.
Environmental provisions have been estimated based on
internal and third-party estimates of contamination, available
remediation technology, and environmental regulations.
Estimates are subject to revision as further information develops
or circumstances change.
Provisions for emission obligations are recognized to cover the
shortage between the Company's CO
2
emissions and the
allowances granted, based on the market value of the CO
2
allowances as of the reporting date or purchase price of the
acquired CO
2
emission rights.
In 2024, provisions for emission
obligations increased due to higher production in Europe as
compared to 2023, which was impacted by outages of blast
furnaces
.
The Company uses derivative financial instruments
and spot purchases to manage its exposure to fluctuations in
prices of emission rights allowances. See note 6.3 for the details
of the cash flow hedging in place for emission rights, note 4.5 for
CO
2
emission rights held as current assets and note 5.1 for
CO
2
emission rights held as Intangible non-current assets. The
Company also receives indirect compensation through rebates
on its energy tariffs.
Provisions for site restoration are related to costs in connection
w
ith the dismantling of site facilities, mainly in France, of which
respect to the dismantling of the Florange liquid phase.
Provisions for staff related obligations primarily concern Brazil
and are related to various employees’ compensation.
Provisions for voluntary separation plans primarily relate to
plans in South Africa, Spain, France and Belgium, which are
expected to be settled within one year. In 2024, the increase in
provisions for voluntary separation plans included
27
related to
the Longs Business of ArcelorMittal South Africa and
33
with
respect to the Sustainable Solutions reportable segment.
Provisions for litigation include losses relating to present legal
obligations that are considered to be probable see also note 9.3.
In 2024 and 2023 provisions for commercial agreements and
onerous contracts were primarily linked to onerous contracts in
South Africa, Poland and Spain.
Other provisions of
73
and
182
at December 31, 2024 and
2023, respectively, are related to the Complementary
Agreement Term signed in 2021 between ArcelorMittal Brazil,
the Federal and State Prosecutor Offices and the Commission
representing affected people, which includes precautionary
evacuation of the communities close to the Serra Azul dam, as
well as the commitment to implement action plans to ensure the
stability, security and decommissioning of the tailing dam. Other
provisions also comprise technical warranties and guarantees.
Environmental Liabilities
ArcelorMittal’s operations are subject to a broad range of laws
and regulations relating to the protection of human health and
the environment at its multiple locations and operating
subsidiaries. As of
December 31, 2024
, excluding asset
retirement obligations, ArcelorMittal had established provisions
of
506
for environmental remedial activities and liabilities. The
provisions for all operations by geographic area included mainly
Europe
Environmental provisions for ArcelorMittal’s operations in
Europe are mainly related to the investigation and remediation
of environmental contamination at current and former operating
sites in Belgium (
58
), Luxembourg (
81
), France (
55
), Poland
(
102
) and Germany (
34
). This investigation and remediation
work relates to various matters such as decontamination of
water discharges, waste disposal, cleaning water ponds and
remediation activities that involve the clean-up of soil and
groundwater. These provisions also relate to human health
protection measures such as fire prevention and additional
contamination prevention measures to comply with local health
and safety regulations.
In Belgium, environmental provisions mainly relate to legal site
remediation obligations linked to the closure of the primary
installations at the Liège site of ArcelorMittal Belgium. The
provisions also include the external recovery and disposal of
waste, residues or by-products that cannot be recovered
internally at the ArcelorMittal Ghent and Liège sites and the
removal and disposal of material containing asbestos.
On April 30, 2024, ArcelorMittal completed the sale and transfer
of certain environmental obligations related to several industrial
wastelands including the Chertal site, blast furnaces B and 6
and the coke plant in Liège (Belgium) to different private
investors and the Walloon Region. Accordingly, the Company
derecognized
148
environmental provisions and recognized
current and non-current liabilities for the same amount with
respect to the funding of such obligations.
In Luxembourg, environmental provisions relate to the post-
closure monitoring and remediation of former production sites,
waste disposal areas, slag deposits and mining sites.
291
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
In France, environmental provisions principally relate to the
remediation of former sites, including several coke plants and
the remediation and improvement of storage of residues and
secondary materials, treatment of slag dumps, disposal of waste
at different ponds and landfills, removal of asbestos from the
installations and mandatory financial guarantees to cover risks
of major accident hazard or for gasholders and waste storage.
Most of the provision relates to the stocking areas at the Dunkirk
site, the mothballing of the liquid phase in Florange, including
study and surveillance of soil and water to prevent
environmental damage, and the treatment and elimination of
waste.
In Poland, environmental provisions include
89
for cleaning and
remediation costs following the closure of primary facilities in
Kraków, including coke plant and land remediation of post-
industrial areas in Ruszca (district of Kraków).
In Germany, the
34
environmental provision essentially relates
to ArcelorMittal Bremen’s post-closure obligations at the Prosper
coke plant in Bottrop mainly established for soil remediation,
groundwater treatment and monitoring.
South Africa
AMSA's environmental provisions include
26
related to the
decommissioned Pretoria Works site in a state of care and
maintenance with ongoing rehabilitation and
20
related to the
Newcastle Works site mainly with respect to
air quality
improvements, waste site remediation and storm water
management.
AMSA's environmental provisions also include
32
related to the environmental rehabilitation of the Thabazimbi
mine.
Canada
In Canada, ArcelorMittal Dofasco has a
26
environmental
provision for the expected cost of remediating toxic sediment
located at the East Boatslip site.
Asset retirement obligations
Asset retirement obligations ("AROs") arise from legal
requirements and represent management’s best estimate of the
present value of the costs that will be required to retire plant and
equipment or to restore a site at the end of its useful life, mainly
in connection with mining operations. As of
December 31, 2024
,
ArcelorMittal had established provisions for AROs of
478
,
including mainly
159
for Brazil,
134
for Canada,
59
for Mexico,
AROs related to mining activities and total undiscounted amount
of site restoration obligations amounted to
424
and
984
,
respectively.
Additions to AROs in 2024 included
136
related to the
decommissioning of the Serra Azul mine (Brazil) tailing dam
scheduled to begin in 2025.
AROs in Canada relate to site restoration and dismantling of the
facilities near the mining sites in Mont-Wright and Fire Lake, and
the accumulation area of mineral substances at the facility of
Port-Cartier in Quebec, upon closure of the mines pursuant to
the restoring plan of the mines. In addition, Dofasco has legal
obligations for the former Sherman Mine site near Temagami,
Ontario.
AROs in Mexico relate to the restoration costs of the Las
Truchas, El Volcan, San Jose and the joint operation Peña
Colorada iron ore mines.
AROs in Ukraine are legal obligations for site rehabilitation at
the iron ore mining site in Kryvyi Rih, upon closure of the mine
pursuant to its restoration plan.
In Germany, AROs principally relate to the Hamburg site, which
operates on leased land with the contractual obligation to
remove all buildings and other facilities upon the termination of
the lease, and to the Prosper coke plant in Bottrop for filling the
basin, restoring the layer and stabilizing the shoreline at the
harbor.
|
|
Balance at December 31,
|
||
|
|
2024
|
2023
|
|
|
Derivative financial instruments (notes 6.1
and 6.3)
|
|
|
|
|
Payable from acquisition of financial
assets
|
|
|
|
|
Unfavorable contracts
|
|
|
|
|
Income tax payable
|
|
|
|
|
Put option liability ArcelorMittal Texas HBI
(note 11.5.2)
|
|
|
|
|
Put option liability Sonasid (note 11.5.2)
|
|
|
|
|
Other
|
|
|
|
|
Total
|
|
|
|
As of December 31, 2024
, payable from non-cash acquisition of
financial assets included
222
relating to outstanding equity
contributions for joint ventures (in addition to
224
classified as
accrued expenses and other liabilities, see note 4.8).
Additionally,
39
and
52
respectively, were related to AMNS
India's debt guarantee (see note 9.4).
Unfavorable contracts of
156
and
233
as of December 31, 2024
and 2023, respectively, mainly related to ArcelorMittal Pecém
(see note 2.2.4) and ArcelorMittal Brasil.
As of December 31, 2024, the income tax payable mainly
related to income tax contingencies (in majority unasserted
claims) and withholding tax.
292
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
Tax Claims
ArcelorMittal is a party to various tax claims. As of
December 31, 2024
, ArcelorMittal had recorded short-term and
long-term liabilities related to income tax contingencies of
267
and provisions for non-income tax claims in the aggregate of
79
for which it considers the risk of loss to be probable. Set out
below is a summary description of the tax claims (i) for which
ArcelorMittal had recorded a provision as of
December 31,
2024
, (ii) that constitute a contingent liability, (iii) that were
resolved in
2024
or (iv) that were resolved and had a financial
impact in 2023 or 2022, in each case involving amounts deemed
material by ArcelorMittal. The Company is vigorously defending
against the pending claims discussed below.
Claims that
previously were disclosed may no longer be described because
of rulings in the case, changes in ArcelorMittal’s business or
other developments rendering them, in ArcelorMittal’s judgment,
no longer material. These include the claims disclosed in the
previous year for which ArcelorMittal no longer expects to report
on their status, absent a change in ArcelorMittal’s judgment of
their materiality.
Brazil
In 2011, ArcelorMittal Brasil received a tax assessment for
corporate income tax (known as IRPJ) and social contributions
on net profits (known as CSL) in relation to (i) the amortization
of goodwill on the acquisition of Mendes Júnior Siderurgia (for
the 2006 and 2007 fiscal years), (ii) the amortization of goodwill
arising from the mandatory tender offer ("MTO") made by
ArcelorMittal (ex-Mittal Steel N.V.) to minority shareholders of
Arcelor Brasil in connection with the two-step merger of Arcelor
and Mittal Steel N.V. (for the 2007 tax year), (iii) expenses
related to pre-export financing used to finance the MTO, which
were deemed by the tax authorities to be unnecessary for
ArcelorMittal Brasil since the expenses were incurred to buy
shares of its own company and (iv) CSL over profits of
controlled companies in Argentina and Costa Rica. In January
2025, ArcelorMittal Brasil was formally notified of the decision
(issued in April 2024) that annulled
78
%
of the tax assessment,
and the
Federal Revenue Service has
already partially written
off
339
that was annulled.
The outstanding claim value amounts
to
75
.
In April 2016, ArcelorMittal Brasil received a tax assessment in
relation to (i) the amortization of goodwill resulting from the MTO
made by ArcelorMittal (ex-Mittal Steel N.V.) to the minority
shareholders of Arcelor Brasil in connection with the two-step
merger of Arcelor and Mittal Steel N.V. in 2007 and (ii) the
amortization of goodwill resulting from ArcelorMittal Brasil’s
acquisition of CST in 2008. While the assessment, if upheld,
would not result in a cash payment as ArcelorMittal Brasil did
not have an
y tax liability for the fiscal years in question (2011
and 2012), it would result in a
52
financial impact arising from a
write off of 'net operating loss carry forward' with respect to the
2011-2012 tax year
. ArcelorMittal Brasil appealed against the
unfavorable decision on the lower instances of the assessment
in the third instance of the administrative tribunal in November
2019. In November 2024, ArcelorMittal Brasil was formally
notified of the administrative court's decision (issued in April
2024) in the Company's favor in respect of approximately
64
%
of the claim. The outstanding claim value is
19
.
In December 2018, ArcelorMittal Brasil received a tax
assessment of
102
, which could have an additional
18
financial
impact arising from a write-off of 'net operating loss carry
forward' with respect to the 2013-2014 tax years, principally in
relation to the amortization of goodwill resulting from the MTO
made by ArcelorMittal (ex-Mittal Steel N.V.) to the minority
shareholders of Arcelor Brasil in connection with the two-step
merger of Arcelor and Mittal Steel N.V. in 2007. After lower court
decisions and appeals in November 2022, the second instance
of the administrative tribunal cancelled the tax assessment. In
January 2023, the Federal Revenue Service filed an appeal to
the third instance of the administrative tribunal. In May 2024, the
administrative tribunal ruled substantially in ArcelorMittal Brasil's
favor, reducing the contingency amount to
22
and the financial
impact from net operating loss to approximately
7
.
Following the closure of the administrative proceedings in
relation to the April 2016 and December 2018 tax assessments
described above, ArcelorMittal Brasil filed a judicial lawsuit (in
March 2025) challenging the outstanding claim amounts under
both of these tax assessments.
In December 2020, ArcelorMittal Brasil received a tax
assessment of
37
with respect to the 2015-2016 tax years,
related to the amortization of goodwill resulting from the MTO
made by ArcelorMittal (ex-Mittal Steel N.V.) to the minority
shareholders of Arcelor Brasil in connection with the two-step
merger of Arcelor and Mittal Steel N.V. in 2007. ArcelorMittal
Brasil filed its defense in the first instance of the administrative
tribunal in January 2021 which issued an unfavorable decision
in August 2021. ArcelorMittal Brasil filed an appeal to the second
instance of the administrative tribunal in September
2021.
In
February 2025, the second instance of the administrative
tribunal ruled unfavorably to the Company. This decision is not
definitive and the Company will file an appeal to the third
instance of the administrative tribunal.
In the period from 2014 to 2018, ArcelorMittal Brasil received
tax assessments from the Federal Revenue Service in the
amount of
37
disputing its use of credits for PIS and COFINS
social security taxes in 2010, 2011 and 2013. The disputes
relate to the concept of production inputs in the context of these
taxes. In
four
of the cases,
the tax assessments have been
partially reduced and ArcelorMittal Brasil's subsequent appeals
to dispute the
remaining amounts are currently pending. One of
293
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
these cases has already closed at the administrative level and is
pending a decision at the first judicial level.
In the fifth case, the
administrative tribunal of the first instance upheld the tax
assessment in March 2017, and ArcelorMittal Brasil appealed to
the second instance of the administrative tribunal. In the sixth
case, the first instance of the administrative tribunal issued an
unfavorable decision in April 2017, and ArcelorMittal Brasil
appealed to the second instance of the administrative tribunal.
Subsequently, the Superior Court decided
two
leading cases,
not involving ArcelorMittal Brasil, that are expected to strengthen
ArcelorMittal’s defense in the sixth case in which part of the
contingency is related to scrap acquisition. In February 2011,
ArcelorMittal Brasil also filed a claimant individual lawsuit on the
PIS/COFINS credits over scrap acquisition matter, in which a
favorable and unappealable decision was issued in May 2022.
Accordingly and as a result of this legal clarification, in 2022,
ArcelorMittal recorded PIS/COFINs tax credits in cost of sales in
the amount of
300
with respect to prior periods. In September
2024, the second case was upheld in the administrative tribunal
of second instance, with the appeal being partially granted in
relation to credits on the following expenses: (i) scrap
acquisition freight not subject to the payment of contributions
under the terms of CARF summary no. 188; (ii) waste recovery:
(iii) analysis services, water treatment and recovery and (iv)
personal protective equipment. ArcelorMittal Brasil was notified
of such decision in January 2025 and is waiting for the Federal
Revenue Service to recalculate the remaining amount of the
debt.
In May 2014, ArcelorMittal Comercializadora de Energia
received a tax assessment from the state of Minas Gerais
alleging that the Company did not correctly calculate tax credits
on interstate sales of electricity from February 2012 to
December 2013. The amount claimed totals
33
. Following the
conclusion of this proceeding at the administrative level, the
Company received the tax enforcement notice in December
2015 and filed its defense in February 2016. In April 2016,
ArcelorMittal Comercializadora de Energia received an
additional tax assessment in the amount, of
48
, after taking
account of a reduction of fines mentioned below regarding the
same matter, for infractions which allegedly occurred during the
2014 to 2015 period, and filed its defense in May 2016.
Following appeal, the Company received a notice from the tax
authority in November 2017 that reduced the fees in the second
case by
12
, due to retrospective application of a new law. In
addition, in February 2019, a reduction of the fine by
7
was
finalized in the first case due to the retrospective application of a
new law. In October 2024, the first case was dismissed
unfavorably to ArcelorMittal Brasil, validating the tax assessment
and in November 2024, Arcelor
Mittal Brasil filed a motion for
clarification
. In the second case, in July 2024, a favorable
decision was granted by the first instance, cancelling the tax
assessment, but, as only one of the tax infractions was
analyzed, both parties filed a motion for clarification. In October
2024, the State's appeal was granted, confirming the tax
assessment, and only removing the collection of the fines that
exceeds
100
%
of the tax value, for each penalty. In November
2024, ArcelorMittal Brasil filed a new appeal (motion for
clarification) that is still pending.
In 2015, ArcelorMittal Brasil received
nine
tax assessments from
the state of Rio Grande do Sul alleging that the Company,
through its branches in that state, had not made advance
payments of ICMS on sales in that state covering the period
from May 2010 to April 2015. The amount claimed totals
73
. In
the Administrative instance, all the cases were unfavorably
closed. ArcelorMittal Brasil filed
5
lawsuits to discuss the matter.
In the first judicial instance, ArcelorMittal Brasil obtained a
largely favorable decisions in all cases. There were appeals
from the Company and the tax authority. In September 2022, the
second judicial instance ruled a largely favorable decision for
the Company in
one
case (in amount of
4
). In November 2023,
the second judicial instance ruled a largely favorable decision in
the Company in
two
cases (in the amount of
7
). In December
2023, the court of the second judicial instance ruled against the
Company in another case (in the amount of
1
) and began
adjudicating the last case (in the amount of
61
). In December
2024, the State Court ruled in favor of ArcelorMittal Brasil in the
last case, which, together with the prior favorable decisions,
reduces the contingency by
88
%
. The Tax Authority can still
appeal to the Superior Court of Justice.
On May 17, 2016, ArcelorMittal Brasil received a tax
assessment from the state of Santa Catarina in the amount of
amount of its ICMS credits. In the Administrative instance, the
case was unfavorably closed in November 2020, and
ArcelorMittal Brasil filed a lawsuit to challenge the assessment.
The case is pending at the judicial instance currently.
In January 2023, ArcelorMittal Brasil received a tax assessment
from the Federal Revenue Service in an amount of
132
in which
the tax authority rejected the offsetting of PIS/COFINS credits
used by the Company in 2018. The dispute relates to various
types of credits such as credits recognized in Court processes
(exclusion of ICMS from the PIS and COFINS calculation base,
PIS/COFINS credits in the Manaus Free Trade Zone), expenses
related to the acquisition of scrap (including freight), expenses
related to port handling, and expenses for freight for finished
products. ArcelorMittal Brasil filed an administrative defense in
February 2023. In November 2023,ArcelorMittal Brasil was
notified of the unfavorable decision and filed an appeal in
December 2023. In August 2024, the
second instance of the
Administrative Court
ruled in favor of the Company, determining
the return of the case to the first instance for a new trial.
294
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
In January 2023, ArcelorMittal Brasil received a tax assessment
in an amount of
13
for a
50
%
fine for alleged non-payment of
the monthly estimate of CIT related to fiscal year 2018. The
Federal Revenue accuses the Company of undue offsetting of
CIT credits paid in Venezuela from 2010 to 2014 when
calculating the monthly IRC estimate for 2018. In February
2023, ArcelorMittal Brasil filed its defense. In September 2023,
the first instance of the Administrative Court ruled against the
Company and ArcelorMittal Brasil filed an appeal. On
September 11, 2024, the second instance of the Tax
Administrative Court (CARF) began the trial of the Company's
appeal. In November 2023, ArcelorMittal Brasil received a new
tax assessment of
51
. The Federal Revenue accuses the
Company of allegedly undue offsetting of CIT credits paid in
Venezuela from 2010 to 2014 and offset by ArcelorMittal Brasil
in 2018. In December 2023, the Company filed an administrative
defense. In June 2024, the
first instance of the Administrative
Court decided unfavorably to the appeal filed by the Company.
In July 2024, the Company filed an appeal. Both cases are
currently pending judgment by the second instance of the
Administrative Court.
In August 2024, ArcelorMittal Brasil received a new tax
assessment related to PIS and COFINS credits for the period
2019-2020 (first case). Due to this new tax assessment, the
Federal Union also issued
10
decisions that did not approve or
only partially approved PIS/COFINS credits used during the
same period to offset debts, creating
10
more cases. The total
value claimed in these
11
cases is
97
. In September 2024,
ArcelorMittal Brasil filed an administrative defense for
9
out of
the
11
cases. For other
2
cases, AM Brasil was notified in April
2024 and filed an administrative defense in May 2024. In August
2024,
a new decision was issued regarding the third case,
reviewing the previous disallowance, and approving an
additional part of the offsetting. AM Brasil presented a further
defense in September 2024.
I
n December 2024, ArcelorMittal Brasil received a new tax
assessment in the amount of
51
charging corporate income tax
(IRPJ and CSLL) related to the taxation of controlled foreign
companies (CFC taxation), questioning (i) the taxation of
Venezuela’s results (UNKI and UNICON), as well as their
consolidation in ArcelorMittal Brasil’s CIT tax base; and (ii)
ArcelorMittal Brasil’s right to offset on a monthly basis or at the
end of the fiscal year – tax credits paid in Argentina by VSA’s
subsidiaries (related to previous years). ArcelorMittal Brasil filed
its defense in January
2025
.
Mexico
In 2015, the Mexican Tax Administration Service issued a tax
assessment to ArcelorMittal Mexico, with respect to 2008,
principally due to improper interest deductions relating to certain
loans, and unpaid corporate income tax for interest payments
that the tax authority categorized as dividends. ArcelorMittal
Mexico's complaint for annulment before a Federal
Administrative and Tax Court is pending. The amount of the tax
assessment as of
December 31, 2024
is
215
.
In October 2018, the Mexican Tax Administration Service issued
a tax assessment to ArcelorMittal Las Truchas, with respect to
2013 due to: (i) improper interest deductions relating to certain
loans (ii) non-deduction of advanced rent payments and (iii)
non-deduction of rolling roll expenses. In November 2018,
ArcelorMittal Las Truchas filed an administrative appeal before
the Administrative Authority on Federal Tax Matters, which wa
s
rejected in June 2019 and is being appealed. Therefore, in
August 2019, ArcelorMittal Las Truchas filed an annulment
complaint before a Federal Administrative and Tax Court. In
June 2023, the Federal Administrative and Tax Court ruled
against the annulment claim. In July 2023, ArcelorMittal Las
Truchas filed an appeal before the Court of Appeal. The amount
of the tax assessment as of
December 31, 2024
is
112
.
On February 24, 2023, the Tax Administration Service notified
ArcelorMittal Las Truchas of a tax assessment, with respect to
2014. In April 2023, ArcelorMittal Las Truchas filed an
administrative appeal in respect of this assessment before the
Tax Administrative Service. The amount of the tax assessment
as of December 31, 2024 is
109
.
A tax assessment in the amount of
190
was issued by the
Mexican Tax Authorities to ArcelorMittal Las Truchas in
September 2024. The tax authority is disputing deductions
relating to back-to-back loan interest, forex losses and Net
Operating Losses for the years 2013-15. ArcelorMittal Las
Truchas filed its defense in October 2024.
Competition/Antitrust Claims
ArcelorMittal is a party to various competition/antitrust claims. As
of
December 31, 2024
, ArcelorMittal had recorded a non-
material amount provision in respect of such claims. Set out
below is a summary description of competition/antitrust claims
(i) that constitute a contingent liability, (ii) that were resolved in
2024 or (iii) that were resolved and had a financial impact in
2023 or 2022, in each case involving amounts deemed material
by ArcelorMittal. The Company is vigorously defending against
each of the pending claims discussed below.
Brazil
In September 2000,
two
construction trade organizations filed a
complaint with Brazil’s Administrative Council for Economic
Defense (“CADE”) against
three
long steel producers, including
ArcelorMittal Brasil. The complaint alleged that these producers
colluded to raise prices in the Brazilian rebar market, thereby
violating applicable antitrust laws. In September 2005, CADE
issued its final decision against ArcelorMittal Brasil, imposing a
fine of
71
.
ArcelorMittal Brasil appealed the decision issued
against it. On December 30, 2024, CADE and ArcelorMittal
295
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
Brasil signed a settlement agreement in the context of the
“Desenrola Program” launched by the Federal Government.
ArcelorMittal Brasil paid
17
to the Federal Government and filed
a petition asking for the extinction of the annulment
proceedings, conditioned on the approval of the transaction.
Therefore, the actual amount in dispute is
nil
as of December
31, 2024.
There is also a related class action commenced by the Federal
Public Prosecutor of the state of Minas Gerais against
ArcelorMittal Brasil for damages in an amount of
70
based on
the alleged violations investigated by CADE. The injunction
requested by the Federal Prosecution Office was denied. The
case is awaiting judgement.
A further related lawsuit was commenced in February 2011 by
in federal court in Brasilia against,
inter alia
, ArcelorMittal Brasil
claiming damages based on an alleged cartel in the rebar
market as investigated by CADE and as noted above. The case
is awaiting judgement.
Other Legal Claims
ArcelorMittal is a party to various other legal claims. As of
December 31, 2024
, ArcelorMittal had recorded provisions of
risk of loss to be probable. Set out below is a summary
description of the other legal claims (i) in respect of which
ArcelorMittal had recorded a provision as of
December 31,
2024
, (ii) that constitute a contingent liability, (iii) that were
resolved in 2024, or (iv) that were resolved and had a financial
impact in 2023 or 2022, in each case involving amounts deemed
material by ArcelorMittal. The Company is vigorously defending
against each of the claims discussed below that remain
pending. Other legal claims that previously were disclosed may
no longer be described because of rulings in the case, changes
in ArcelorMittal’s business or other developments rendering
them, in ArcelorMittal’s judgment, no longer material.
These
include claims disclosed in the previous year for which
ArcelorMittal no longer expects to report on their status, absent
a change in ArcelorMittal’s judgment of their materiality.
Brazil
In 2015, the SINDIMETAL (employees’ union) filed a lawsuit
against ArcelorMittal Brasil to annul all the collective labor
agreements related to 12-hour work shifts. The case impacts a
group of approximately
2,500
employees. In July 2022, the
Supreme Court decided a leading case, not involving
ArcelorMittal Brasil, that may favorably impact ArcelorMittal
Brasil's case, which is currently pending on appeal. The
estimated amount of claim is
55
.
In April 2017, a shareholder in Siderúrgica Três Lagoas
(“SITREL”) (of which ArcelorMittal Brasil is the other
shareholder), commenced an arbitration against Votorantim
Siderurgia S.A. (which subsequently merged into ArcelorMittal
Brasil) and SITREL with the Center for Arbitration and Mediation
of the Chamber of Commerce Brazil-Canada (CAM-CCBC). The
dispute concerns a provision in SITREL’s joint venture
agreement relating to the formula used t
o
determine the selling
price for steel billets supplied by ArcelorMittal Brasil to SITREL
from January 2013 onwards. The shareholder has alleged that
the steel billets were overpriced and is seeking compensation
for overpaid amounts on both a retrospective and prospective
basis, with the initial amount claimed totaling
33
. In April 2022, a
final arbitral award was issued, which has been satisfied by
ArcelorMittal Brasil. Given ArcelorMittal Brasil’s ownership
interest in SITREL, the financial impact for ArcelorMittal was a
net loss after tax of approximately
126
(
67
net of partial recovery
through dividend payment from SITREL) in 2022.
On March 30, 2022, Votorantim S.A. (“Votorantim”) exercised
the put option right it has under its shareholders’ agreement with
the Company to sell its entire equity interest in ArcelorMittal
Brasil to the Company, following the acquisition of Votorantim's
long steel business in Brazil in 2018. There is a dispute between
the parties as to the value of the put option. Votorantim has
valued the put option at BRL
5.825
billion (i.e.
941
). In
September 2022, Votorantim commenced an arbitration against
ArcelorMittal Brasil seeking the full amount of its valuation of the
put option, reduced by the undisputed amount ArcelorMittal
Brasil accepted as the value of the put option and which was
paid in January 2023 for
179
(see note 11.5.2).
The parties have
filed their respective statements of defense and rejoinders in the
arbitration.
Votorantim
claimed in its rejoinder an additional
amount of BRL
144
million (i.e.
23
).
The hearing was held in
October 2024 and the award is currently pending. Post-hearing
briefs were submitted in January 2025.
Italy
In January 2010, ArcelorMittal received notice of a claim filed by
Finmasi S.p.A. relating to a memorandum of agreement (“MoA”)
entered into between ArcelorMittal Distribution Services France
(“AMDSF”) and Finmasi in 2008. The MoA provided that AMDSF
would acquire certain of Finmasi’s businesses for an amount not
to exceed
114
, subject to the satisfaction of certain conditions
precedent, which, in AMDSF’s view, were not fulfilled. Finmasi
sued for (i) enforcement of the MoA, (ii) damages of
17
to
29
or
(iii) recovery costs plus quantum damages for Finmasi’s alleged
lost opportunity to sell to another buyer. In September 2011, the
court rejected Finmasi’s claims other than its second claim. The
court appointed an expert to determine the quantum of
damages. In May 2013, the expert’s report was issued and
valued the quantum of damages in the range of
46
to
73
.
ArcelorMittal appealed the decision on the merits. In January
2019, Finmasi called on the AMDSF guarantee issued in the
context of the enforcement proceedings that were suspended in
296
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
2015. After a series of appeals, Finmasi has repaid half of the
amount of the guarantee that was called and provided a bank
guarantee for the remainder. In December 2022, the Court
found that AMDSF has the right to obtain restitution of
approximately
28
paid to Finmasi and ordered Finmasi to pay
the half still outstanding (approximately
13.9
) plus interest and
certain costs. In February
2023, Finmasi filed an appeal to the
Court of Cassation. AMDSF duly filed its defense in March
2
023.
France
Retired and current employees of certain French subsidiaries of
ArcelorMittal have initiated lawsuits to obtain compensation for
asbestos exposure in excess of the amounts paid by French
social security (“Social Security”). Asbestos claims in France
initially are made by way of a declaration of a work-related
illness by the claimant to the social security authorities resulting
in an investigation and a level of compensation paid by social
security. Once the social security authorities recognize the work-
related illness, the claimant, depending on the circumstances,
can also file an action for inexcusable negligence (
faute
inexcusable
) to obtain additional compensation from the
employer before a special tribunal. For faute inexcusable cases,
the primary health insurance fund, CPAM - advances, the
amount of damages and pension increase are reimbursed by
the employer found at fault and takes recourse action against
the employer.
The number of claims outstanding for asbestos exposure at
December 31, 2024
was
203
as compared to
243
at
December 31, 2023
.
Minority Shareholder Claims Regarding the Exchange Ratio in
the Second-Step Merger of ArcelorMittal into Arcelor
ArcelorMittal is the company that resulted from the acquisition of
Arcelor by Mittal Steel N.V. in 2006 and a subsequent two-step
merger between Mittal Steel and ArcelorMittal and then
ArcelorMittal and Arcelor. Following completion of this merger
process, several former minority shareholders of Arcelor or their
representatives brought legal proceedings regarding the
exchange ratio applied in the second-step merger between
ArcelorMittal and Arcelor and the merger process as a whole.
ArcelorMittal believes that the allegations made and claims
brought by such minority shareholders are without merit and that
the exchange ratio and merger process complied with the
requirements of applicable law, were consistent with previous
guidance on the principles that would be used to determine the
exchange ratio in the second-step merger and that the merger
exchange ratio was relevant and reasonable to shareholders of
both merged entities.
Set out below is a summary of the ongoing matter in this regard.
Several other claims brought before other courts and regulators
on similar grounds were dismissed and are definitively closed.
On May 15, 2012, ArcelorMittal received a writ of summons on
behalf of Association des Actionnaires d'Arcelor ("AAA"), a
French association of former minority shareholders of Arcelor to
appear before the civil court of Paris. The AAA alleged in
particular that, based on Mittal Steel’s and Arcelor’s disclosure
and public statements, investors had a legitimate expectation
that the exchange ratio in the second-step merger would be the
same as that of the secondary exchange offer component of
Mittal Steel’s June 2006 tender offer for Arcelor (i.e.,
11
Mittal
Steel shares for
7
Arcelor shares), and that the second-step
merger did not comply with certain provisions of
company law.
AAA claimed, inter alia, damages in a nominal amount and
reserved the right to seek additional remedies including the
cancellation of the merger. The proceedings before the civil
court of Paris were stayed, pursuant to a ruling of such court on
July 4, 2013, pending a preparatory investigation (
instruction
préparatoire
) by a criminal judge magistrate (
juge d’instruction
)
triggered by the complaints of AAA and several hedge funds
(who quantified their total alleged damages at
282
). The
dismissal of charges (non-lieu) ending the preparatory
investigation became final in March 2018.
On March 6, 2020
AAA revived its claim before the civil court of Paris on its behalf
and on behalf of the hedge funds who had also filed a criminal
complaint, as well as
two
new plaintiffs.
In October 2024, the
court ruled in ArcelorMittal's favor, dismissing all of AAA's
claims. Following AAA's appeal in December 2024, AAA filed
their first brief in March 2025, which quantified its damages
claim at
420
(€
404
million) plus interest
.
Poland
In October 2024, ArcelorMittal Global Holding S.à.r.l.,
ArcelorMittal Poland S.A. and ArcelorMittal Long Products
Europe Holding S.à.r.l. were served with a Request for
Arbitration filed by Tauron Polska Energia S.A. ("Tauron"). The
dispute arises out of the exercise of put-options in Tameh
Holding, a joint venture between the Company and Tauron. The
Company's reply to the summons was filed on October 30,
2024. Each party claims to have exercised an effective put-
option, which the other party disputes. Tauron seeks the
payment of
145
(PLN
598
million) for its
50
%
shareholding in
Tameh. In the response, the Company filed a counterclaim
against Tauron for the same amount. Tribunal selection is
ongoing.
297
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
December 31,
|
|||
|
2024
|
2023
|
||
|
Commitments related to purchases of raw
materials and energy
|
|
|
|
|
Guarantees, pledges and other collateral
|
|
|
|
|
Capital expenditure commitments
|
|
|
|
|
Other commitments
|
|
|
|
|
Total
|
|
|
|
Commitments related to purchases of raw materials and energy
Purchase commitments consist primarily of major agreements
for procuring iron ore, coking coal, coke and hot metal. The
Company also has a number of agreements for electricity,
industrial and natural gas, scrap and freight. In addition to those
purchase commitments disclosed above, the Company enters
into purchasing contracts as part of its normal operations which
have minimum volume requirements but for which there are no
take-or-pay or penalty clauses included in the contract. The
Company does not believe these contracts have an adverse
effect on its liquidity position.
Commitments related to purchases of raw materials and energy
included commitments given to associates for
1,704
and
1,487
as of
December 31, 2024
and 2023, respectively. Purchase
commitments given to associates included
798
and
704
as of
December 31, 2024
and 2023, respectively, related to the gas
supply agreement with Kryvyi Rih Industrial Gas. Purchase
commitments included commitments given to joint ventures for
Purchase commitments given to joint ventures included
287
and
December 31, 2024
and 2023, respectively.
Guarantees, pledges and other collateral
Guarantees related to financial debt and credit lines given on
behalf of third parties were
256
and
155
as of
December 31,
2024
and 2023, respectively. Additionally, guarantees of
11
and
and
4,992
were given on behalf of joint ventures as of
December 31, 2024
and 2023, respectively.
Guarantees given on behalf of joint ventures included
1,183
and
421
on behalf of Calvert,
186
and
208
on behalf of Al Jubail,
outstanding lease liabilities for vessels operated by Global
Chartering as of
December 31, 2024
and 2023, respectively.
Guarantees given on behalf of Calvert increased by
846
in 2024
in relation to a loan from the Industrial Development Authority of
Mobile County in Alabama (USA) following the issuance of
bonds. Guarantees given on behalf of joint ventures also
included
4,038
and
3,490
as of
December 31, 2024
and 2023
corresponding to ArcelorMittal's
60
%
guarantee of the debt
under the term loan agreements entered into by the AMNS India
joint venture with various Japanese banks.
As of
December 31, 2024
, pledges and other collateral mainly
related to (i) mortgages entered into by the Company’s
operating subsidiaries and (ii) inventories and receivables
pledged to secure the South African Rand revolving borrowing
base finance facility for the amount drawn of
144
and ceded
bank accounts to secure environmental obligations, true sale of
receivables programs and the revolving borrowing base finance
facility in South Africa of
95
. Pledges of property, plant and
equipment were
33
and
59
as of
December 31, 2024
and 2023,
respectively. Other sureties, first demand guarantees, letters of
credit, pledges and other collateral included
291
and
319
of
commitments given on behalf of associates as of
December 31,
2024
and 2023, respectively, and
404
and
313
of commitments
given on behalf of joint ventures as of
December 31, 2024
and
2023, respectively.
Capital expenditure commitments
Capital expenditure commitments relate to commitments with
respect to purchases of property, plant and equipment including
in the context of expansion and improvement projects.
Capital expenditure commitments include
257
and
507
at
December 31, 2024
and 2023, respectively, relating to
ArcelorMittal Liberia Ltd in connection with Phase 2 expansion
involving the construction of
20
million
tonnes of concentrate
sinter fines capacity and associated infrastructure.
Capital expenditure commitments also include
12
and
49
at the
iron ore Serra Azul mine (Brazil) at
December 31, 2024
and
2023, respectively, in connection with the construction of
facilities to produce
4.5
million tonnes per annum of DRI quality
pellet feed.
Other commitments
As of September 21, 2018 an Environmental Commitment
Agreement ("ECA") has been executed between ArcelorMittal
Brasil, local government and the Brazilian environmental
authorities. ArcelorMittal Brasil committed to carry out, until
2026, a series of environmental operational and capital
investments with the aim to reduce atmospheric emissions from
the Company's Tubarão site. To comply with the ECA
requirements, ArcelorMittal Brasil may need to acquire new
equipment and change some of its current operating methods
and processes. As of
December 31, 2024
and 2023,
ArcelorMittal Brasil estimated the underlying costs to implement
those investments at
12
and
78
, respectively. The non-
compliance with ECA would lead to fines amounting to a
maximum of
16
and
21
as of
December 31, 2024
and 2023,
respectively. On November 19, 2021, following a protocol of
intent agreed between the Minas Gerais State Government,
ArcelorMittal Brasil and BMB Belgo Mineira Bekaert Artefatos
298
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
De Arame Ltd ("BMB"), ArcelorMittal Brasil committed to carry
out capital expenditures at its facilities in Minas Gerais State,
besides employment generation. As of
December 31, 2024
and
2023, commitments related to this project were
295
and
348
,
respectively.
Other commitments given also comprise commitments incurred
for gas supply to electricity suppliers.
Commitments to sell
In addition to the commitments presented above, the Company
has firm commitments to sell for which it also has firm
commitments to purchase included in purchase commitments
for
2,897
and
131
as of
December 31, 2024
and 2023,
respectively, and mainly related to natural gas and electricity.
Commitments to sell included
2,787
as of
December 31, 2024
relating to the
25
-year offtake agreement entered into in 2024
between the Company and AMNS India for the supply of
renewable electricity from wind and solar power generation at
the Company's facility in Andhra Pradesh (India).
Other
On February 28, 2024, the State of the Grand-Duchy of
Luxembourg exercised the right (following an agreement signed
between ArcelorMittal, the Fonds d'Urbanisation et
d'Aménagement du Plateau de Kirchberg and the State of the
Grand-Duchy of Luxembourg on December 20, 2022) to acquire
right-of-use of land in the Kirchberg district of the city of
Luxembourg. The acquisition price is based on construction
cost. On July 31, 2024,
ArcelorMittal and the State of the Grand-
Duchy of Luxembourg signed a sale compromise pursuant to
which this acquisition will be completed at the end of the
construction time.
|
Segment
|
Number of contracts
|
start-end dates
|
Average remaining contract
duration (in years)
|
Committed amount
|
|
Brazil*
|
|
2016-2053
|
|
|
|
Europe
|
|
2019-2032
|
|
|
*At December 31, 2024, the Company has not yet recognized a commitment with respect to the PPA signed between ArcelorMittal Brasil and VdSA. The Company may have
a potential commitment of approximately
1.5
billion upon commissioning of the VdSA power plant, which is currently under construction. The PPA is established for a duration
of
20
years
, commencing in 2026 contingent to commissioning of the VdSA power plant.
(loss) for the year. Taxable profit differs from profit as reported in
the consolidated statements of operations because it excludes
items of income or expense that are taxable or deductible in
other years or are never taxable or deductible. The Company’s
current income tax expense (benefit) is calculated using tax
rates that have been enacted or substantively enacted as of the
date of the consolidated statements of financial position.
Tax is charged or credited to the consolidated statements of
operations, except when it relates to items charged or credited
to other comprehensive income or directly to equity, in which
case the tax is recognized in other comprehensive income or in
equity.
Deferred tax is recognized on differences between the carrying
amounts of assets and liabilities, in the consolidated financial
statements and the corresponding tax basis used in the
computation of taxable profit, and is accounted for using the
statements of financial position liability method. Deferred tax
liabilities are generally recognized for all taxable temporary
differences, and deferred tax assets are generally recognized
for all deductible temporary differences and net operating loss
carry forwards to the extent that it is probable that taxable profits
will be available against which those deductible temporary
differences can be utilized. Such assets and liabilities are not
recognized if the taxable temporary difference arises from the
initial recognition of non-deductible goodwill or if the differences
arise from the initial recognition (other than in a business
combination) of other assets and liabilities in a transaction that
affects neither the taxable profit nor the profit reported in the
consolidated statements of operations.
Deferred tax liabilities are recognized for taxable temporary
differences associated with investments in subsidiaries,
associates and joint ventures, except if the Company is able to
control the reversal of the temporary difference and it is
probable that the temporary difference will not reverse in the
foreseeable future. Deferred tax assets arising from deductible
temporary differences associated with such investments are
only recognized to the extent that it is probable that there will be
sufficient taxable profits against which the benefits of the
temporary differences can be utilized and are expected to
reverse in the foreseeable future.
Deferred tax assets and liabilities are measured at the tax rates
that are expected to apply in the period in which the liability is
settled or the asset realized, based on tax rates (and tax laws)
299
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
that have been enacted or substantively enacted at the
consolidated statements of financial position date. The
measurement of deferred tax assets and liabilities reflects the
tax consequences that would result from the manner in which
the Company expects, at the reporting date, to recover or settle
the carrying amount of its assets and liabilities.
The carrying amount of deferred tax assets is reviewed at each
consolidated statements of financial position date and reduced
to the extent that it is no longer probable that sufficient taxable
profits will be available to enable all or part of the asset to be
recovered. The Company reviews the deferred tax assets in the
different jurisdictions in which it operates to assess the
possibility of realizing such assets based on projected taxable
profit, the expected timing of the reversals of existing temporary
differences, the carry forward period of temporary differences
and tax losses carried forward and the implementation of
planning strategies. Due to the numerous variables associated
with these judgments and assumptions, both the precision and
reliability of the resulting estimates of the deferred tax assets
are subject to substantial uncertainties. In case a history of
recent losses is present, the Company considers whether
convincing other evidence exists, such as the character of
(historical) losses and planning opportunities, to support the
deferred tax assets recognition.
D
eferred tax assets and liabilities are offset when there is a
legally enforceable right to set off current tax assets against
current tax liabilities, when they relate to income taxes levied by
the same taxation authority and when the Company intends to
settle its current tax assets and liabilities on a net basis.
Uncertain (income) tax positions are periodically assessed by
the Company based on management’s best judgment given any
changes in the facts, circumstances and information available
and applicable tax laws. When it is probable that the position
taken in the tax return will not be accepted by the tax authorities,
the Group establishes provisions based on the most likely
amount of the liability (recovery) or weighted average of various
possible outcomes to reflect the effect of the uncertainty in
determining the related taxable profit (tax loss), tax bases,
unused tax losses, unused tax credits or tax rates, to the extent
that a reliable estimate can be made.
The Company has adopted International Tax Reform – Pillar
Two Model Rules (Amendments to IAS 12 upon their release on
May 23, 2023). The Amendments provide a temporary
mandatory exception from deferred tax accounting for the top-up
tax, which is effective immediately, and require disclosures
about the Pillar Two exposure from
December 31, 2023
. The
Company has applied a temporary mandatory relief from
deferred tax accounting for the impacts of the top-up tax and
accounts for it as a current tax when incurred.
Pillar Two legislation has been enacted or substantively enacted
in the jurisdiction of ArcelorMittal S.A., the ultimate parent of the
Group, and in certain other jurisdictions where the Company
operates. The legislation is effective for the Company’s financial
year beginning January 1, 2024.
Based on the applicable
summarized as follows:
|
|
Year ended December 31,
|
||||
|
|
2024
|
2023
|
2022
|
||
|
Total current tax expense
1
|
|
|
|
||
|
Total deferred tax expense
(benefit)
|
|
(
|
(
|
||
|
Total income tax expense
|
|
|
|
||
statutory rates applicable in the countries where the Company
operates to the total income tax expense as calculated:
|
|
Year ended December 31,
|
||||
|
|
2024
|
2023
|
2022
|
||
|
Net income (loss) (including non-
controlling interests)
|
|
|
|
||
|
Income tax expense
|
|
|
|
||
|
Income before tax
|
|
|
|
||
|
Tax expense at the statutory rates
applicable to income in the
countries
2
|
|
|
|
||
|
Permanent items
|
(
|
(
|
(
|
||
|
Rate changes
|
|
|
|
||
|
Net change in measurement of
deferred tax assets
|
|
(
|
(
|
||
|
Tax effects of foreign currency
translation
|
(
|
(
|
(
|
||
|
Tax credits
|
(
|
(
|
(
|
||
|
Other taxes
|
|
|
|
||
|
Others
|
|
|
|
||
|
Income tax expense
|
|
|
|
||
1.
For the year ended December 31, 2024, current income tax expense includes
2.
Tax expense at the statutory rates is based on income before tax excluding
ArcelorMittal’s consolidated income tax expense is affected by
the income tax laws and regulations in effect in the various
countries in which it operates and the pre-tax results of its
subsidiaries in each of these countries, which can change from
year to year. ArcelorMittal operates in jurisdictions, mainly in
Eastern Europe and Asia, which have a structurally lower
corporate income tax rate than the statutory tax rate as enacted
300
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
in Luxembourg (
23.87
%), as well as in jurisdictions, mainly in
Brazil and Mexico, which have a structurally higher corporate
income tax rate.
|
Permanent items
|
Year ended December 31,
|
||||
|
2024
|
2023
|
2022
|
|||
|
Taxable reversals of (tax
deductible) write-downs on shares
and receivables
|
|
(
|
(
|
||
|
Non-deductible loss on disposal of
Kazakhstan operations
|
|
|
|
||
|
Juros sobre o Capital Próprio
|
(
|
(
|
(
|
||
|
Other permanent items
|
(
|
|
|
||
|
Total permanent items
|
(
|
(
|
(
|
||
T
axable reversals of (tax deductible) write-downs on shares and
receivables:
in connection with the Company's impairment test
for goodwill and property, plant and equipment, the
recoverability of the carrying amounts of investments in shares
and intragroup receivables is also reviewed annually, resulting in
tax deductible write-downs, or taxable reversals of previously
recorded write-downs, of the values of loans and shares of
consolidated subsidiaries in Luxembourg.
Juros sobre o Capital Próprio
: Corporate taxpayers in Brazil,
which distribute a dividend can benefit from a tax deduction
corresponding to an amount of interest calculated as a yield on
capital. The deduction is determined as the lower of the interest
as calculated by application of the Brazilian long term interest
rate on the opening balance of capital and reserves, and 50% of
the income for the year or accumulated profits from the previous
year. For accounting purposes, this distribution of interest on
capital is regarded as a dividend distribution, while for Brazilian
tax purposes it is regarded as tax deductible interest.
Non-deductible loss on disposal of Kazakhstan operation
s: the
Company recorded
0.9
billion
impairment charges and
1.5
billion
foreign exchange translation losses in connection with the
divestment of its operations in Kazakhstan in 2023. Both items
were non-deductible for tax purposes, see note 2.3.
Rate changes
The
370
tax expense resulting from rate changes in 2024 is due
to the decrease from
24.94
%
to
23.87
%
of the statutory tax rate
as enacted in Luxembourg and applied to deferred taxes.
Net change in measurement of deferred tax assets
The 2024 net change in measurement of deferred tax assets of
Luxembourg of
(
381
)
mainly due to the utilization of
unrecognized tax losses carried forward, and (ii) net
unrecognition of
563
of deferred tax assets related to negative
results for the year in other tax jurisdictions.
The 2023 net change in measurement of deferred tax assets of
(
423
)
mainly consisted of (i) recognition of deferred tax assets in
Luxembourg of
(
314
)
including recognition of tax losses carried
forward based on revised taxable income forecast of
(
366
)
and
net recognition of
(
109
)
, of deferred tax assets in other tax
jurisdictions, including
(
292
)
recognition related to higher future
profits expectation.
The 2022 net change in measurement of deferred tax assets of
(
1,154
)
mainly consists of recognition of deferred tax assets in
Luxembourg of
(
1,227
)
including mainly
(
676
)
effect of the
utilization of unrecognized tax losses carried forward following
higher profitability of the current year (net of write-downs of
shares),
(
579
)
recognition of tax losses carried forward based
on revised taxable income forecast, derecognition of deferred
tax assets on losses and deductible temporary differences in
Ukraine of
178
, and
(
105
)
utilization of deferred tax assets in
other tax jurisdictions, following profits generated during the
year.
Tax effects of foreign currency translation
The tax effects of foreign currency translation of
(
21
)
,
(
20
)
and
(
34
)
at
December 31, 2024
,
2023
and 2022, respectively, refer
mainly to deferred tax assets and liabilities of certain entities
with a different functional currency than the currency applied for
tax filing purposes.
Tax credits
The tax credits are mainly attributable to the Company’s
operating subsidiaries in Brazil. They relate to credits claimed
on foreign investments, credits for research and development
and other credits.
Other taxes
Other taxes mainly include withholding taxes on dividends,
services, royalties and interests as well as mining duties in
Canada and Mexico, state tax, Corporate Alternative Minimum
Tax ("CAMT"), Base Erosion and Anti-Abuse Tax ("BEAT") in the
United States, and
Cotisation sur la Valeur Ajoutée des
Entrepris
es
("CVAE'') in France.
|
Others
|
Year ended December 31,
|
||||
|
2024
|
2023
|
2022
|
|||
|
Tax contingencies/settlements
|
|
|
(
|
||
|
Prior period taxes
|
(
|
(
|
|
||
|
Others
|
(
|
(
|
|
||
|
Total
|
|
|
|
||
Tax contingencies/settlements of
263
,
43
, and
(
3
)
at
December 31, 2024
,
2023
and 2022, respectively, consist of
uncertain tax positions (see note 10.3) including
202
recorded
in 2024
for
expected resolution
of the tax disputes in th
e North
America segment
.
301
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
comprehensive income
|
|
Year ended December 31,
|
|||||
|
|
2024
|
2023
|
2022
|
|||
|
Recognized in other comprehensive
income on:
|
||||||
|
Deferred tax expense (benefit)
|
|
|
|
|||
|
Gain (loss) on derivative financial
instruments
|
(
|
(
|
(
|
|||
|
Recognized actuarial gain (loss)
|
|
(
|
|
|||
|
Foreign currency translation
adjustments
|
|
|
|
|||
|
(
|
(
|
|
||||
|
Recognized directly in equity on:
|
||||||
|
Deferred tax expense (benefit)
|
||||||
|
Loss related to repurchase of MCNs
|
|
(
|
|
|||
|
|
(
|
|
||||
|
|
||||||
|
Total
|
(
|
(
|
|
|||
The Company operates in multiple jurisdictions with complex
legal and tax regulatory environments. In certain of these
jurisdictions, ArcelorMittal has taken income tax positions that
management believes are supportable and are intended to
withstand challenge by tax authorities. Some of these positions
are inherently uncertain and include those relating to transfer
pricing matters and the interpretation of income tax laws applied
in complex transactions. The Company periodically reassesses
its tax positions. Changes to the financial statement recognition,
measurement and disclosure of tax positions are based on
management’s best judgment given any changes in the facts,
circumstances, information available and applicable tax
laws. Considering all available information and the history of
resolving income tax uncertainties, the Company believes that
the ultimate resolution of such matters will not have a material
effect on the Company’s financial position, statements of
operations or cash flows beyond the income tax contingencies
|
Assets
|
Liabilities
|
Net
|
|||||||||
|
2024
|
2023
|
2024
|
2023
|
2024
|
2023
|
||||||
|
Intangible assets
|
|
|
(
|
(
|
(
|
(
|
|||||
|
Property, plant and equipment
|
|
|
(
|
(
|
(
|
(
|
|||||
|
Inventories
|
|
|
(
|
(
|
|
|
|||||
|
Financial instruments
|
|
|
(
|
(
|
(
|
(
|
|||||
|
Other assets
|
|
|
(
|
(
|
(
|
(
|
|||||
|
Provisions
|
|
|
(
|
(
|
|
|
|||||
|
Other liabilities
|
|
|
(
|
(
|
|
|
|||||
|
Tax losses and other tax benefits carried forward
|
|
|
|
|
|
|
|||||
|
Tax credits carried forward
|
|
|
|
|
|
|
|||||
|
Deferred tax assets (liabilities)
|
|
|
(
|
(
|
|
|
|||||
|
Deferred tax assets
|
|
|
|||||||||
|
Deferred tax liabilities
|
(
|
(
|
|||||||||
302
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
Deferred tax assets recognized by the Company as of
December 31, 2024
included the following:
|
Gross amount
|
Total deferred
tax assets
|
Recognized
deferred tax
assets
|
Unrecognized
deferred tax
assets
|
||||
|
Tax losses and other tax benefits carried forward
|
|
|
|
|
|||
|
Tax credits carried forward
|
|
|
|
|
|||
|
Other temporary differences
|
|
|
|
|
|||
|
Total
|
|
|
|
|
Deferred tax assets recognized by the Company as of
December 31, 2023
included the following:
|
Gross amount
|
Total deferred
tax assets
|
Recognized
deferred tax
assets
|
Unrecognized
deferred tax
assets
|
||||
|
Tax losses and other tax benefits carried forward
|
|
|
|
|
|||
|
Tax credits carried forward
|
|
|
|
|
|||
|
Other temporary differences
|
|
|
|
|
|||
|
Total
|
|
|
|
As of
December 31, 2024
, the majority of unrecognized deferred
tax assets relates to tax losses carried forward attributable to
various subsidiaries located in different jurisdictions
(primarily
France, Germany, Luxembourg, Spain and South Africa)
with
different statutory tax rates. At each reporting date, ArcelorMittal
considers existing evidence, both positive and negative,
including the earnings history and results of recent operations,
reversals of deferred tax liabilities, projected future taxable
income, and planning strategies, that could impact the view with
regard to future realization of these deferred tax assets.
The amount of the total deferred tax assets is the aggregate
amount of the various recognized and unrecognized deferred
tax assets at the various subsidiaries and not the result of a
computation with a given blended rate. The utilization of tax
losses carried forward is restricted to the taxable income of the
subsidiary or tax consolidation group to which it belongs. The
utilization of tax losses carried forward may also be restricted by
the character of the income, expiration dates and limitations on
the yearly use of tax losses against taxable income.
At
December 31, 2024
, the total amount of accumulated tax
losses in Luxembourg with respect to the ArcelorMittal S.A. tax
integration amounted to
130.3
billion
, of which
35.5
billion
is
considered realizable, resulting in the recognition of
8.5
billion
of
deferred tax assets at the applicable income tax rate in
Luxembourg. At
December 31, 2023
, the total amount of
accumulated tax losses in Luxembourg with respect to the main
tax consolidation amounted to approximately
120.6
billion
, of
which
35.3
billion
was considered realizable, resulting in the
recognition of
8.8
billion
of deferred tax assets at the applicable
income tax rate in Luxembourg. Under the Luxembourg tax
legislation, tax losses generated before
2017
can be carried
forward indefinitely and are not subject to any specific yearly
loss utilization limitations. The tax losses carried forward relate
primarily to tax deductible write-down charges taken on
investments in shares of consolidated subsidiaries recorded by
certain of ArcelorMittal’s holding companies in Luxembourg. Of
the total tax losses carried forward,
69.7
billion
may be subject
to recapture in the future if the write-downs that caused them
are reversed creating taxable income unless the Company
crystallizes them through sales or other organizational
restructuring activities.
The Company believes that it is probable that sufficient future
taxable profits will be generated to support the recognized
deferred tax asset for tax losses carried forward in Luxembourg.
As part of its recoverability assessment the Company has taken
into account (i) its most recent forecast approved by
management and the Board of Directors, (ii) the likelihood that
the factors that have contributed to past losses in Luxembourg
will not recur, (iii) the fact that ArcelorMittal in Luxembourg is the
main provider of funding to the Company’s consolidated
subsidiaries, leading to significant amounts of taxable interest
income on outstanding and future loans as updated based on
most recent funding strategy, (iv) the expected level of interest
expenses in Luxembourg driven by the Group net debt level, (v)
the industrial franchise agreement whereby ArcelorMittal S.A.
licenses its business model for manufacturing, processing and
distributing steel to group subsidiaries, and (vi) other significant
and reliable sources of operational income earned from
ArcelorMittal’s European and worldwide operating subsidiaries
for centralized distribution and procurement activities performed
in Luxembourg. The Company has also considered the
implications of the net-zero path and its carbon emissions
303
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
intensity reduction targets on its future taxable profits
expectations in relation to the existing business models and the
potential future financing of such projects, resulting in no major
impact on the estimated level of future taxable profit. In
performing the assessment, the Company estimates at which
point in time its earnings projections are no longer reliable, and
thus taxable profits are no longer probable. Accordingly, the
Company has established consistent forecast periods for its
different income streams for estimating probable future taxable
profits, against which the unused tax losses can be utilized in
Luxembourg.
At
December 31, 2024
, based upon the level of historical
taxable income and projections for future taxable income over
the periods in which the deductible temporary differences are
anticipated to reverse, management believes it is probable that
ArcelorMittal will realize the benefits of the recognized deferred
tax assets of
8.9
billion
. The amount of future taxable income
required to be generated by ArcelorMittal’s subsidiaries to utilize
the deferred tax assets of
8.9
billion
is at least
39.3
billion
.
Historically, the Company has been able to generate sufficient
taxable income and believes that it will generate sufficient levels
of taxable income in the coming years to allow the Company to
utilize tax benefits associated with tax losses carried forward
and other deferred tax assets that have been recognized in its
consolidated financial statements. Where the Company has had
a history of recent losses, it relied on convincing other evidence
such as the character of (historical) losses and planning
opportunities to support the deferred tax assets recognized.
As of
December 31, 2024
, ArcelorMittal recorded
132
of
deferred income tax liabilities in respect of deferred taxation that
would arise if temporary differences on investments in
subsidiaries, associates and interests in joint ventures were to
be realized in the foreseeable future as compared to
168
as of
December 31, 2023
. No deferred tax liability has been
recognized in respect of other temporary differences on
investments in subsidiaries, associates and interests in joint
ventures because the Company is able to control the timing of
the reversal of the temporary difference and it is probable that
such differences will not reverse in the foreseeable future. The
amount of these unrecognized deferred tax liabilities is
898
at
December 31, 2024 (
870
at December 31, 2023).
forward
At
December 31, 2024
, the Company had total estimated tax
losses carried forward and other tax benefits of
150.2
billion
.
billion
primarily related to subsidiaries in the Basque Country in
Spain, Luxembourg, Mexico, Poland and the United States,
which expire as follows:
|
Year expiring
|
Recognized
|
Unrecognized
|
Total
|
|||
|
2025
|
|
|
|
|||
|
2026
|
|
|
|
|||
|
2027
|
|
|
|
|||
|
2028
|
|
|
|
|||
|
2029
|
|
|
|
|||
|
2030 - 2045
|
|
|
|
|||
|
Total
|
|
|
|
The remaining tax losses carried forward and other tax benefits
for an amount of
124.7
billion
(of which
39.6
billion
are
recognized and
85.1
billion
are unrecognized) are carried
forward for unlimited period of time and primarily relate to the
Company’s operations in Brazil, France, Germany, Luxembourg,
and Spain.
At
December 31, 2024
, the Company also had total estimated
tax credits carried forward of
646
.
recognized and
357
unrecognized) primarily attributable to
subsidiaries in the Basque country in Spain and Luxembourg
which expire as follows:
|
Year expiring
|
Recognized
|
Unrecognized
|
Total
|
|||
|
2025
|
|
|
|
|||
|
2026
|
|
|
|
|||
|
2027
|
|
|
|
|||
|
2028
|
|
|
|
|||
|
2029
|
|
|
|
|||
|
2030 - 2045
|
|
|
|
|||
|
Total
|
|
|
|
The remaining tax credits for an amount of
184
of which
136
are
recognized and
48
are unrecognized) are indefinite and
primarily attributable to the Company’s operations in Spain and
the United States.
Tax losses, tax credits and other tax benefits carried forward are
denominated in the currency of the countries in which the
respective subsidiaries are located and operate, except for
Luxembourg where the tax losses are mainly denominated in
U.S. dollar. Fluctuations in currency exchange rates could
impact the U.S. dollar equivalent value of these tax losses
304
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
Share capital
On April 28, 2023, ArcelorMittal cancelled
25
million
treasury
shares to keep the number of treasury shares within appropriate
levels. This cancellation took into account the shares already
purchased under the
60,431,380
share buyback program (see
below). Following this cancellation, the aggregate number of
shares issued and fully paid up and share capital decreased
from
877,809,772
and
312
as of December 31, 2022 to
Share capital remained unchanged at December 31, 2024.
|
December 31, 2022
|
Movement in year
|
December 31, 2023
|
Movement in year
|
December 31, 2024
|
|||||
|
Issued shares
|
|
(
|
|
|
|
||||
|
Treasury shares
|
(
|
|
(
|
(
|
(
|
||||
|
Total outstanding shares
|
|
|
|
(
|
|
The number of issued shares was
877,809,772
at
December 31
,
2022 and
852,809,772
at December 31, 2023 and 2024.
Authorized shares
Following the cancellation of treasury shares on April 28, 2023,
authorized share capital decreased from
404
represented by
December 31, 2022 to
395
represented by
1,111,418,599
ordinary shares without nominal value as of December 31, 2023
and remained unchanged at December 31, 2024.
Share buyback
On April 25, 2022, ArcelorMittal completed its
1,000
share
buyback program announced on February 11, 2022 under the
authorization given by the annual general meeting of
shareholders of June 8, 2021 and repurchased
31.8
million
shares for a total value of
€
911
million
(equivalent to
1000
) at an
approximate average price per share of €
28.68
($
31.49
).
On June 8, 2022, ArcelorMittal completed a second share
buyback program in the amount of
1,000
under the authorization
given by the annual general meeting of shareholders of May 4,
2022, bringing the total 2022 buybacks announced so far to
value of
€
943
million
(equivalent to
1,000
) at an approximate
average price per share of €
28.26
($
29.99
).
On July 29, 2022, the Company announced a third share
buyback program of
60.4
million
shares (approximately
1.4
billion based on share price as of July 26, 2022) to be
completed by the end of May 2023 (subject to market
conditions) under the authorization given by the annual general
meeting of shareholders of May 4, 2022. The Significant
Shareholder has decided not to participate in the program
consistent with the position announced on February 25, 2022.
On March 31, 2023, ArcelorMittal completed the share buyback
program. The total repurchase value was
€
1,456
million (
1,492
)
at an approximate average price per share of €
24.10
($
24.68
).
On May 5, 2023, ArcelorMittal announced the commencement
of a new buyback program of up to
85
million
shares under the
authorization given by the annual general meeting of
shareholders of May 2, 2023, to be completed by May 2025.
The actual amount of shares that will be repurchased pursuant
to this new program will depend on the level of post-dividend
free cash flow ("FCF") (calculated as net cash provided by
operating activities less purchases of property, plant and
equipment and intangibles less dividends paid to non-controlling
shareholders) generated over the period (the Company’s
defined policy is to return a minimum of
50
%
of post-dividend
annual FCF), the continued authorization by shareholders, and
market conditions.
At market closure on December 31, 2024,
ArcelorMittal had repurchased
78.2
million shares for a total
value of €
1,802
million (
1,952
) at an average price per share of
€
23.03
($
24.96
).
The shares acquired under the different programs are intended
to reduce ArcelorMittal’s share capital, and/or to meet
ArcelorMittal’s obligations arising from employee share
programs.
Treasury shares
ArcelorMittal held, indirectly and directly,
84.3
million and
33.5
million
treasury shares as of December 31, 2024 and
December 31, 2023, respectively.
Mandatory convertible bonds
The
Company
issued through Hera Ermac, a wholly-owned
subsidiary,
1,000
corresponding to
666,666
unsecured and
unsubordinated bonds mandatorily convertible into preferred
shares of such subsidiary ("MCBs"). The bonds were placed
privately with a Luxembourg affiliate of Crédit Agricole and are
not listed. The Company has the option (fair value was
nil
as of
December 31, 2024 and 2023) to
call
the mandatory convertible
bonds until
10
business days before the maturity date. Hera
Ermac invested the proceeds of the bonds issuance and an
305
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
equity contribution by the Company in notes issued by
subsidiaries of the Company and linked to the value of China
Oriental. The conversion date of the mandatory convertible
bonds was extended from time to time
.
The Company
determined that the MCBs are a hybrid instrument including an
equity component recognized as non-controlling interests and a
liability component for interest payments.
On March 14, 2023, the Company early repaid
226,666
out of
the
666,666
MCBs for a total cash consideration of
340
.
Following the early partial repayment, the Company allocated
the cash consideration to the liability component (
25
) and equity
component (
315
) of the instrument, which resulted in
291
decrease in non-controlling interests and
24
decrease in
retained earnings consistent with the original allocation using
the net present value of the future interest payments at the date
of early redemption.
On December 21, 2023, the Company signed an agreement for
an extension of the conversion date of the mandatory
convertible bonds from January 31, 2024 to January 30, 2026.
The other main features of the mandatory convertible bonds
remained unchanged. The Company determined that this
transaction led to the extinguishment of the existing compound
instrument and the recognition of a new compound instrument
including non-controlling interests for
547
and other liabilities for
recognition at fair value of the new instrument resulted in
66
expense included in financing costs-net in the consolidated
statement of operations and
32
decrease in non-controlling
interests.
On
May 18, 2020
, the Company completed an offering of
mandatorily convertible subordinated notes (“MCNs”) due May
18, 2023 for
1,250
. The MCNs had a
three
-year maturity, were
issued at
100
%
of the principal amount and were mandatorily
converted into common shares of the Company upon maturity
unless converted earlier at the option of the holders or
ArcelorMittal during the conversion period or upon occurrence of
certain defined events. On May 19, 2023, upon mandatory
conversion of the
24,290,025
remaining outstanding MCNs,
ArcelorMittal delivered a total of
57,057,991
treasury shares (of
which
9,396,120
to the Significant Shareholder) with a carrying
amount of
1,534
. The Company determined that the MCNs are
a hybrid instrument including an equity component and a liability
component for interest payments
. Following the mandatory
conversion, it derecognized the
509
equity component
presented separately in the statements of changes in equity and
recognized a
1,025
(
794
net of tax) decrease in additional paid-
in capital.
income by the weighted average number of common shares
outstanding during the year. Diluted earnings per share is
computed by dividing income available to equity holders by the
weighted average number of common shares plus potential
common shares from share unit plans whenever the conversion
common share for the years ended
December 31, 2024
,
2023
and
2022
.
|
Year ended December 31,
|
|||||
|
2024
|
2023
|
2022
|
|||
|
Net income attributable to equity holders of the parent
|
|
|
|
||
|
Weighted average common shares outstanding (in millions) for the purposes of basic earnings per share
|
|
|
|
||
|
Incremental shares from assumed conversion of restricted share units and performance share units (in
millions)
|
|
|
|
||
|
Weighted average common shares outstanding (in millions) for the purposes of diluted earnings per share
|
|
|
|
||
Calculations to determine the amounts available for dividends
are based on ArcelorMittal’s separate financial statements
(“ArcelorMittal S.A.”) which are prepared in accordance with
IFRS
, as endorsed by the European Union. ArcelorMittal S.A.
has no significant manufacturing operations of its own
and
generates its profit mostly from financing activities and the
management fees/industrial franchise agreements with Group
companies.
Accordingly, it can only pay dividends or
distributions to the extent it is entitled to receive cash dividend
distributions from its subsidiaries’ recognized gains, profit
generated by its own activities, from the sale of its assets or
share premiums from the issuance of
common shares.
Dividends are declared in U.S. dollar and are payable in either
U.S. dollar or in euros.
306
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
Description
|
Approved by
|
Dividend per
share (in $)
|
Payout date
|
Total (in
millions of $)
|
|||
|
Dividend for financial year 2021
|
Annual general shareholders’ meeting on May 4, 2022
|
|
June 10, 2022
|
|
|||
|
Dividend for financial year 2022
|
Annual general shareholders’ meeting on May 2, 2023
|
|
June 15, 2023 and
December 7, 2023
|
|
|||
|
Dividend for financial year 2023
|
Annual general shareholders’ meeting on April 30, 2024
|
|
June 12, 2024 and
December 4, 2024
|
|
On April 30, 2024 at the annual general meeting of
shareholders, the shareholders approved the Company’s
dividend of $
0.50
per share. The dividend amounted to
393
and
payment includes
two
installments; the first installment of
200
was paid on June 12, 2024 and the second one of
193
was
settled on December 4, 2024.
In February 2025, the Board of Directors recommended the
base annual dividend of $
0.55
per share, to be paid in
two
equal
installments in June and December 2025, subject to the
approval of shareholders at the annual general meeting of
shareholders in May 2025.
and for the years ended
December 31, 2024
,
2023
and
2022
.
|
Name of Subsidiary
|
Country of
incorporation
and operation
|
% of non-
controlling
interests
and non-
controlling
voting
rights at
December
31, 2024
|
% of non-
controlling
interests
and non-
controlling
voting
rights at
December
31, 2023
|
Net income
(loss)
attributable
to non-
controlling
interests for
the year
ended
December
31, 2024
|
Non-
controlling
interests at
December
31, 2024
|
Net income
(loss)
attributable
to non-
controlling
interests for
the year
ended
December
31, 2023
|
Non-
controlling
interests at
December
31, 2023
|
Net income
(loss)
attributable
to non-
controlling
interests for
the year
ended
December
31, 2022
|
||||||||
|
AMSA
|
South Africa
|
|
|
(
|
|
(
|
|
|
||||||||
|
Société Nationale de Sidérurgie
S.A. ("Sonasid")
1
|
Morocco
|
|
|
|
|
|
|
|
||||||||
|
AMKR
|
Ukraine
|
|
|
(
|
|
(
|
|
(
|
||||||||
|
Belgo Bekaert Arames ("BBA")
|
Brazil
|
|
|
|
|
|
|
|
||||||||
|
Hera Ermac
2
|
Luxembourg
|
|
|
|
|
|
|
|
||||||||
|
AMMC
|
Canada
|
|
|
|
|
|
|
|
||||||||
|
Finocas
5
|
Belgium
|
|
|
|
|
|
|
|
||||||||
|
Arceo
|
Belgium
|
|
|
|
|
|
|
|
||||||||
|
AML
3
|
Liberia
|
|
|
(
|
(
|
(
|
(
|
|
||||||||
|
ArcelorMittal Texas HBI
4
|
USA
|
|
|
(
|
|
(
|
|
(
|
||||||||
|
Other
|
|
|
|
|
|
(
|
|
|
||||||||
|
Total
|
|
|
|
|
|
|
|
|
1.
Sonasid - ArcelorMittal holds a controlling stake of
50
%
in Nouvelles Sidérurgies Industrielles ("NSI"). ArcelorMittal controls NSI on the basis of a shareholders’ agreement
which includes deadlock arrangements in favor of the Company. NSI holds a
64.86
%
stake in Sonasid. The total non-controlling interests in Sonasid of
67.57
%
are the
result of ArcelorMittal’s indirect ownership percentage in Sonasid of
32.43
%
through its controlling stake in NSI.
2.
Hera Ermac - The non-controlling interests correspond to the equity component net of transaction fees of the mandatory convertible bonds maturing on January 30, 2026
(see note 11.2).
307
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
3.
AML is incorporated in Cyprus. On December 17, 2024, December 21, 2023 and December 20, 2022, ArcelorMittal fully settled
200
,
100
and
300
capital increases,
respectively, in ArcelorMittal Liberia Ltd including
30
,
15
and
45
, respectively, on behalf of non-controlling interests.
4.
On June 30, 2022, ArcelorMittal acquired a
80
%
controlling stake in ArcelorMittal Texas HBI (see note 2.2.4).
5.
ArcelorMittal holds a
50
%
controlling interest in Finocas NV ("FInocas"). ArcelorMittal controls Finocas on the basis of a shareholders’ agreement which includes deadlock
arrangements in favor of the Company.
As
from January 1, 2051, the Flemish Region has the right to acquire the
50
%
interest held in Finocas by the Company at a price
equivalent to the fair market value of the shares on that date as determined by an independent expert if a capital decrease requested by any of the shareholders is not
approved by the general meeting of shareholders.
and
2023
and summarized statements of operations and summarized statements of cash flows for the years ended
December 31,
2024
,
2023
and
2022
.
|
December 31, 2024
|
||||||||||||||||||
|
Summarized statements
of financial position
|
AMSA
|
Sonasid
|
AMKR
|
BBA
|
Hera
Ermac
|
AMMC
|
Arceo
|
AML
|
Finocas
|
ArcelorMittal
Texas HBI
|
||||||||
|
Current assets
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Non-current assets
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Total assets
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Current liabilities
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Non-current liabilities
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Net assets
|
|
|
|
|
|
|
|
(
|
|
|
||||||||
|
December 31, 2024
|
||||||||||||||||||
|
Summarized statements of
operations
|
AMSA
|
Sonasid
|
AMKR
|
BBA
|
Hera
Ermac
|
AMMC
|
Arceo
|
AML
|
Finocas
|
ArcelorMittal
Texas HBI
|
||||||||
|
Revenue
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Net (loss) income
|
(
|
|
(
|
|
|
|
|
(
|
|
(
|
||||||||
|
Total comprehensive
income (loss)
|
(
|
|
(
|
|
|
|
|
(
|
|
(
|
||||||||
|
|
December 31, 2024
|
|||||||||||||||||
|
Summarized statements of cash
flows
|
AMSA
|
Sonasid
|
AMKR
|
BBA
|
Hera
Ermac
|
AMMC
|
Arceo
|
AML
|
Finocas
|
ArcelorMittal
Texas HBI
|
||||||||
|
Net cash provided by / (used in)
operating activities
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Net cash provided by / (used in)
investing activities
|
(
|
(
|
(
|
(
|
(
|
(
|
(
|
(
|
(
|
(
|
||||||||
|
Net cash provided by / (used in)
financing activities
|
|
(
|
(
|
(
|
(
|
(
|
(
|
|
|
|
||||||||
|
Impact of currency movements on
cash
|
(
|
(
|
(
|
(
|
|
|
(
|
|
|
|
||||||||
|
Cash and cash equivalents:
|
|
|
|
|
|
|
|
|
||||||||||
|
At the beginning of the year / at
acquisition date
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
At the end of the year
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Dividend to non-controlling interests
|
|
(
|
|
(
|
|
(
|
(
|
|
|
|
||||||||
308
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
|
December 31, 2023
|
||||||||||||||||
|
Summarized statements of
financial position
|
AMSA
|
Sonasid
|
AMKR
|
BBA
|
Hera
Ermac
|
AMMC
|
Arceo
|
AML
|
Finocas
|
ArcelorMittal
Texas HBI
|
|||||||
|
Current assets
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Non-current assets
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Total assets
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Current liabilities
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Non-current liabilities
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Net assets
|
|
|
|
|
|
|
|
(
|
|
|
|||||||
|
|
December 31, 2023
|
||||||||||||||||
|
Summarized statements of operations
|
AMSA
|
Sonasi
d
|
AMKR
|
BBA
|
Hera
Ermac
|
AMMC
|
Arceo
|
AML
|
Finocas
|
ArcelorMittal
Texas HBI
|
|||||||
|
Revenue
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Net income (loss)
|
(
|
|
(
|
|
(
|
|
|
(
|
|
(
|
|||||||
|
Total comprehensive income (loss)
|
(
|
|
(
|
|
(
|
|
|
(
|
|
(
|
|||||||
|
|
December 31, 2023
|
||||||||||||||||
|
Summarized statements of cash flows
|
AMSA
|
Sonasid
|
AMKR
|
BBA
|
Hera
Ermac
|
AMMC
|
Arceo
|
AML
|
Finocas
|
ArcelorMittal
Texas HBI
|
|||||||
|
Net cash provided by / (used in) operating
activities
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Net cash provided by / (used in) investing
activities
|
(
|
(
|
(
|
(
|
|
(
|
(
|
(
|
(
|
(
|
|||||||
|
Net cash provided by / (used in) financing
activities
|
|
(
|
|
(
|
(
|
(
|
(
|
|
|
(
|
|||||||
|
Impact of currency movements on cash
|
(
|
|
(
|
|
|
|
|
|
|
|
|||||||
|
Cash and cash equivalents:
|
|||||||||||||||||
|
At the beginning of the year
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
At the end of the year
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Dividend to non-controlling interests
|
|
(
|
|
(
|
|
(
|
(
|
|
|
(
|
|||||||
|
|
December 31, 2022
|
||||||||||||||||
|
Summarized statements of
operations
|
AMSA
|
Sonasid
|
AMKR
|
BBA
|
Hera
Ermac
|
AMMC
|
Arceo
|
AML
|
Finocas
|
ArcelorMittal
Texas HBI
|
|||||||
|
Revenue
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Net income (loss)
|
|
|
(
|
|
(
|
|
|
|
|
(
|
|||||||
|
Total comprehensive income
(loss)
|
|
|
(
|
|
(
|
|
|
|
|
(
|
|||||||
309
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
|
|
December 31, 2022
|
||||||||||||||||
|
Summarized statements of cash
flows
|
AMSA
|
Sonasid
|
AMKR
|
BBA
|
Hera
Ermac
|
AMMC
|
Arceo
|
AML
|
Finocas
|
ArcelorMittal
Texas HBI
|
|||||||
|
Net cash provided by / (used in)
operating activities
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Net cash provided by / (used in)
investing activities
|
(
|
(
|
(
|
(
|
(
|
|
|
(
|
(
|
(
|
|||||||
|
Net cash provided by / (used in)
financing activities
|
|
(
|
(
|
(
|
(
|
(
|
(
|
|
|
|
|||||||
|
Impact of currency movements on
cash
|
(
|
(
|
(
|
|
|
|
(
|
|
|
|
|||||||
|
Cash and cash equivalents:
|
|
|
|
|
|
|
|||||||||||
|
At the beginning of the year
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
At the end of the year
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Dividend to non-controlling
interests
|
|
(
|
|
(
|
|
(
|
(
|
|
|
|
|||||||
change of control, are accounted for as transactions with
owners in their capacity as owners and therefore no goodwill is
recognized as a result of such transactions. In such
circumstances, the carrying amounts of the controlling and non-
controlling interests are adjusted to reflect the changes in their
relative interests in the subsidiary. Any difference between the
amount by which the non-controlling interests are adjusted and
the fair value of the consideration paid or received is recognized
Transactions with non-controlling interests also include the
mandatory convertible bonds (see note 11.2).
Following the subscription by the Flemish region and
ArcelorMittal on May 30, 2024 and December 9, 2024 of
two
capital increases in Finocas, non-controlling interests increased
by
172
.
Put option liabilities
On March 30, 2022 Votorantim S.A. exercised the put option
right it has under its shareholders’ agreement with the Company
with respect to its
2.9
%
preferred share interest in ArcelorMittal
Brasil following the acquisition of Votorantim S.A.'s long steel
business in Brazil in 2018, which was
subsequently renamed
ArcelorMittal Sul Fluminense ("AMSF").
The exercise price of
the put option is calculated pursuant to an agreed formula in the
shareholders’ agreement which applies a
6
times multiple of
ArcelorMittal Brasil Longs Business EBITDA in the four
immediately preceding calendar quarters from the date of the
put option exercise (subject to certain adjustments, such as the
exclusion of any unusual, infrequent or abnormal events) less
an assumed net debt of BRL
6.2
billion times
15
%
.
The
Company determined that it has a present ownership interest in
the preferred shares subject to the put option. Accordingly, it
recognized at acquisition date of AMSF a
328
financial liability at
amortized cost and measured at the present value of the
redemption amount.
As of December 31, 2022, the Company
calculated the put option exercise price in the amount of
BRL
1.0
billion
(
179
). Votorantim S.A. has indicated that it does
not agree with ArcelorMittal Brasil’s calculation of the exercise
price and filed a request for arbitration on September 28, 2022.
The definition of the final put option exercise price will be subject
to the arbitration procedure. In January 2023,
ArcelorMittal
Brasil settled the undisputed amount it accepts as the value of
the put option for
179
(see note 9.3).
On June 3, 2021, following an amendment to the shareholders'
agreement signed between the Company and non-controlling
interests in NSI, an entity in which ArcelorMittal holds a
50
%
controlling stake and which holds a
64.86
%
interest in Sonasid
in Morocco, the Company granted to such non-controlling
interests a put option to buy the totality of their shares in NSI
exercisable by its holders during the periods between December
5, 2027 to December 4, 2029 and December 5, 2032 to
December 4, 2034.
The carrying amount of the financial liability
at amortized cost was
114
and
116
as of December 31, 2024
and 2023, respectively, and is measured at the present value of
the redemption amount (see note
9
.2).
In conjunction with the acquisition of an
80
%
interest in
ArcelorMittal Texas HBI on June 30, 2022, ArcelorMittal granted
to voestalpine a put option exercisable at the end of the fifth,
tenth and fifteenth year subsequently to the acquisition date.
The carrying amount of the financial liability at amortized cost
was
176
and
158
as of December 31, 2024 and 2023,
respectively and is measured at the present value of the
redemption amount of the written put option based on the lower
of equity value increased by an annual contractual return and
fair
value (see notes 2.2.4 and 9.2).
The related parties of the Group are predominately subsidiaries,
joint operations, joint ventures, associates and key management
310
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
personnel (see note 8.1) of the Group. Transactions between
the parent company, its subsidiaries and joint operations are
eliminated on consolidation and are not disclosed in this note.
Related parties include the Significant Shareholder, which is the
trustee of a fully discretionary trust of which Mr. Lakshmi N.
Mittal and Mrs. Usha Mittal are beneficiaries and which owns,
together with shares owned directly by Mr. and Mrs. Mittal,
Transactions with related parties of the Company mainly relate
to sales and purchases of raw materials and steel products and
were as follows:
|
Year ended December 31,
|
December 31,
|
||||||||||
|
Sales
|
Trade receivables
|
||||||||||
|
Related parties and their subsidiaries where applicable
|
Category
|
2024
|
2023
|
2022
|
2024
|
2023
|
|||||
|
Calvert
|
Joint Venture
|
|
|
|
|
|
|||||
|
Gonvarri Steel Industries
1
|
Associate
|
|
|
|
|
|
|||||
|
Aperam
|
Other
|
|
|
|
|
|
|||||
|
Borçelik
|
Joint Venture
|
|
|
|
|
|
|||||
|
Bamesa
|
Associate
|
|
|
|
|
|
|||||
|
Tuper
|
Joint Venture
|
|
|
|
|
|
|||||
|
ArcelorMittal CLN Distribuzione Italia
|
Joint Venture
|
|
|
|
|
|
|||||
|
Tameh
|
Joint Venture
|
|
|
|
|
|
|||||
|
Coils Lamiere Nastri (C.L.N.)
|
Associate
|
|
|
|
|
|
|||||
|
WDI
2
|
Associate
|
|
|
|
|
|
|||||
|
ArcelorMittal RZK Çelik Servis Merkezi
|
Joint Venture
|
|
|
|
|
|
|||||
|
AMNS India
|
Joint Venture
|
|
|
|
|
|
|||||
|
Other
3
|
|
|
|
|
|
||||||
|
Total
|
|
|
|
|
|
||||||
1.
Gonvarri Steel Industries include mainly the joint ventures ArcelorMittal Gonvarri Brasil Productos Siderúrgicos and ArcelorMittal Gonvarri SSC Slovakia.
2.
WDI includes Westfälische Drahtindustrie Verwaltungsgesellschaft mbH & Co. KG and Westfälische Drahtindustrie GmbH.
3.
Other includes Acciaierie
d'Italia until
February 20, 2024
(refer note 2.4.1)
.
|
Year ended December 31,
|
December 31,
|
||||||||||
|
Purchases
|
Trade payables
|
||||||||||
|
Related parties and their subsidiaries where applicable
|
Category
|
2024
|
2023
|
2022
|
2024
|
2023
|
|||||
|
Tameh
|
Joint Venture
|
|
|
|
|
|
|||||
|
Global Chartering
|
Joint Venture
|
|
|
|
|
|
|||||
|
Integrated Metal Recycling
|
Joint Venture
|
|
|
|
|
|
|||||
|
Aperam
|
Other
|
|
|
|
|
|
|||||
|
Alkat
|
Associate
|
|
|
|
|
|
|||||
|
Exeltium
|
Associate
|
|
|
|
|
|
|||||
|
AMNS India
|
Joint Venture
|
|
|
|
|
|
|||||
|
Baycoat
|
Joint Venture
|
|
|
|
|
|
|||||
|
CFL Cargo
|
Associate
|
|
|
|
|
|
|||||
|
Enerfos
|
Joint Venture
|
|
|
|
|
|
|||||
|
Sitrel
|
Joint Venture
|
|
|
|
|
|
|||||
|
Other
|
|
|
|
|
|
||||||
|
Total
|
|
|
|
|
|
||||||
311
|
Consolidated financial statements
|
|
(millions of U.S. dollar, except share and per share data)
|
On December 3, 2014, ArcelorMittal Calvert LLC signed a
member capital expenditure loan agreement with Calvert; as of
December 31, 2024
and 2023, the loans amounted to
253
and
interest from
2.28
%
to
6.93
%
and have various maturity dates
ranging from less than
1
to
25
years
.
On November 8, 2019, Baffinland entered into an agreement
with a bank to finance up to
6
million tonnes at
78
%
of the value
of the iron ore produced and hauled to the port of Milne Inlet by
Baffinland up to a limit of
450
. This arrangement was renewed
several times since then, and most recently on November 23,
2023. The renewal provided for the bank to finance
87
%
of the
value of the iron ore produced and hauled to the port of Milne
Inlet by Baffinland up to a limit of
600
. On January 30, 2025,
Baffinland entered into a new agreement with a bank to finance
with revised financing percentages and
limits.
On February 10, 2025, the U.S. administration signed an order
to implement
25%
tariffs on all steel and
aluminum
imports. This
order becomes effective on March
12, 2025
. The Company
considers these events as subsequent non-adjusting events.
Although neither the Company’s performance and going
concern nor operations, at the date of authorization of issuance
of these consolidated financial statements, have been
significantly impacted by the above, the Company continues to
monitor the evolving situation and its impact on its financial
position and operations. It may also impact certain of the
Company's estimates. The imposition of tariffs may in the short
term result in higher steel prices; it is uncertain to which extent
the European Union, Canada or other countries or regions may
announce retaliatory protectionist measures (as it was the case
in 2018) as a result of these tariffs and what may be the
outcome of ongoing bilateral negotiations between the U.S. and
certain other countries. In 2018 the impact of tariffs was largely
mitigated with the resulting increase in selling prices and
customer agreements to bear part of the cost. Export sales of
steel products from the Company to the U.S. market
represented
6.7
billion in 2024 of which third party sales are
largely high added-value products.
TABLE OF CONTENTS
Item 17 Item 18Note 2. 2.1 Of The Consolidated Financial Statements For TheNote 9. 3 For A Description Of Contingencies, Including LegalPart By Higher Steel Shipments. in The First Half Of 2023, OperatingPart By Higher Steel Shipments. in The First Half Of 2023, OPart ByPart Thereof Which Is Carried on Through A PermanentNote 1: Accounting PrinciplesNote 2: Scope Of ConsolidationNote 3: Segment ReportingNote 4: Operating DataNote 5: Goodwill, Intangible and Tangible AssetsNote 6: Financing and Financial InstrumentsNote 7: LeasesNote 8: Personnel Expenses and Deferred Employee BenefitsNote 9: Provisions, Contingencies and CommitmentsNote 10: Income TaxesNote 11: EquityNote 12: Related PartiesNote 13: Subsequent EventsNote 1. 3 Use Of Judgment and EstimatesNote 1. 3 Use Of Judgment andNote 2. 2.4 AcquisitionsNote 2. 4.1 Joint VenturesNote 2. 5 Other InvestmentsNote 5. 2 Property, Plant andNote 9. 4 CommitmentsNote 5. 1 Goodwill and Intangible AssetsNote 5. 1 Goodwill and IntangibleNote 5. 2 Property, Plant and Equipment and Biological AssetsNote 5. 3 Impairment Of Intangible Assets, Including Goodwill, and Tangible AssetsNote 5. 3 Impairment Of IntangibleNote 9. 1 ProvisionsNote 8. 3 Share-based PaymentsNote 6. 1.2, There Are No Significant Restrictions Resulting FromNote 9. 4)Note 2. 2.4)Note 2. 3)Note 6. 3 Cash Flow Hedges)Note 6. 3 Net Investment Hedge)Note 6. 1.2.2.)Note 8: Personnel Expenses and DeferredNote 9: Provisions, Contingencies and