Arcelor Mittal in $3bn savings plan

Arcelor Mittal, the world’s largest steelmaker, set out a new $3 billion plan to save money from production and confirmed its target of reducing debt sharply this year following credit rating downgrades.

The Luxembourg-based company said it had targeted gains of $3 billion by the end of 2015, having already reached a goal of $4.8 billion of savings in sales and administrative expenses and other fixed and variable costs at the end of September 2012.

The new target was aimed at increasing its core profit per tonne of steel produced to $150. It dropped to $85 per tonne in 2012 from $118 a year earlier.

Arcelor Mittal said it was reiterating its financial guidance that core profit this year would be higher than in 2012 and that it was on track to reduce net debt to $17 billion by the middle of 2013, with a medium-term goal of $15 billion.

In a presentation to investors, the group said it believed that global steel consumption would be between three and 3.5 per cent higher this year than last, marginally above the three per cent growth guidance it had given in February.

The steelmaker also said it was on course to have an iron ore mining capacity of 84 million tonnes by 2015, with the expansion of its Canadian operations and in Liberia.