Arcelor Mittal says 2006 profit falls 3.5 percent

LUXEMBOURG - Arcelor SA and Mittal Steel Co. NV, joining to form the world’s largest steelmaker, reported a fourth-quarter profit of US$2.37 billion (Ð1.84 billion) Wednesday and said full-year earnings fell 3.5 percent.

By (AP)

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Published: Wed 21 Feb 2007, 5:26 PM

Last updated: Sat 4 Apr 2015, 9:55 PM

The companies, which will be the world’s largest steelmaker with nearly 10 percent of global steel production, also said they will give US$2.4 billion (Ð1.8 billion) back to shareholders through dividends and a share buyback.

Arcelor Mittal, reporting as if the companies were already fully combined, said it earned US$7.97 billion (Ð6.34 billion) in 2006, down 3.5 percent from US$8.26 billion a year earlier. It did not provide comparative figures for the fourth-quarter profit.

Revenue for the three months ended Dec. 31 was US$23.2 billion (Ð17.99 billion) with revenue for the year rising 10 percent to US$88.57 billion (Ð70.53 billion).

The two companies are still counting the cost of coming together after Brazilian regulators ordered Mittal to raise its offer for Arcelor’s Latin American steel unit and the US Department of Justice told the company to sell a Maryland mill to settle antitrust issues.

Arcelor Mittal repeated that it was still evaluating its options’ on whether to appeal the Brazilian decision that could raise the cost of Mittal’s offer for Arcelor by another US$5 billion (Ð3.9 billion).

But it said the Justice Department ruling meant that it was now free to fold Canadian steelmaker Dofasco Inc. into Arcelor Mittal.

German steelmaker ThyssenKrupp AG, which had competed with Arcelor for Dofasco, said Wednesday it has no interest in acquiring the Sparrows Point mill in Maryland.

Arcelor Mittal Chief Executive Lakshmi Mittal said the merger was on track to deliver anticipated savings _ estimated to be US$1.6 billion (Ð1.26 billion) in the first three years.

Looking forward, the market is stable and we are anticipating performance for the first quarter 2007 to be in line with fourth quarter 2006 levels,’ he said.

The companies also announced they had pushed back the completion of their merger until July, a year after Luxembourg-based Arcelor capitulated to Mittal’s third takeover offer in return for substantial concessions following a long and bitter battle.

They must also give a final purchase price for the takeover, saying they had increased the value of Arcelor’s assets at the time of sale.

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