NE BUSINESS BUREAU
HAZIRA, MAY 7
ArcelorMittal Nippon Steel India (AMNS India), a joint venture between ArcelorMittal and Nippon Steel, clocked a 47 per cent higher Ebitda (earnings before interest, taxes, depreciation and amortization) quarter-on-quarter (QoQ) and 188 per cent year-on-year (YoY) to $403 million in the quarter ended March 31, 2021.
While announcing the earnings, which was the best in a decade for ArcelorMittal, the company said in the 1Q21, AMNS India achieved solid production, annualising at 7.3 million tonnes (Mt). The company achieved $403 million Ebitda (with a FY21 run rate of $1.6 billion) with a greater focus on export markets.
ArcelorMittal has a 60 per cent holding in the India joint venture with Nippon Steeland follows a January-December fiscal year. The business (AMNS India) is already exceeding the level of Ebitda required to cover the cash needs of the operations (maintenance capex and cash interest) of $300 million annually, the firm said.
ArcelorMittal said its income from associates, JVs, and other investments for 1Q21 was $453 million, as compared to $7 million for 4Q20 and $142 million in 1Q20. The income was higher on account of improved results from AMNS India and AMNS Calvert.
ArcelorMittal, on Thursday, reported a strong set of numbers on the back of a demand recovery and surging steel prices. The firm reported a net income of $2.3billion in 1Q21, as compared to net income of $1.2 billion and adjusted net income of $0.2 billion in 4Q20. Ebitda of $3.2billion in 1Q21 was 88 per cent higher than 4Q20 Ebitda of $1.7 billion; it was $1.0 billion in 1Q20. Steel shipments were 6.5 per cent higher sequentially.
Commenting on the company’s performance, Dilip Oommen – Chief Executive Officer, AM/NS India – said, “Our business continues to grow strongly with demand generated from domestic and export markets. The Steel industry in India remains attractive and increasing demand is giving the industry the required fillip.”
The near-erm plans involve debottlenecking existing operations (steel shop & rolling parts) to achieve 8.6Mt capacity. In the medium term, the plan is to grow capacity at the Hazira complex in Gujarat to 14Mt. These growth plans are expected to be funded by utilising the cash the business is generating as well as its balance sheet capacity.
An additional pallet plant of 6 Mt capacity equipped with state of technology is fully ready in Paradeep at Orissa; will be functioning shortly.
“As the country battles the second wave of the pandemic, AM/NS India remains committed to supporting the country’s collective efforts. We are scaling up our COVID response efforts from significantly ramping up liquid medical oxygen production, expanding beds capacity, facilitating adequate medical personnel to arranging other facilities at our dedicated Covid-19 hospital in Hazira, Gujarat,” Oommen added.
AM/NS India’s Covid-19 Response
- Liquid Medical Oxygen: ramped up production up to 155% at our Hazira plant, Gujarat, to 250 MT/day [from earlier 160 MT/day]
- Hospital/ Medical facility: In 72 hours, we built a 250-bed facility connected with oxygen supplies from our steel plant, expandable to 1,000 beds. Already expanded to 300 beds and is being supported by 17 doctors, 32 nurses, 10 compounders, 1 WHO certified doctor, canteen, and many supporting team members
- Import of 6 cryogenic containers – filled with medical grade oxygen
- Converted existing 6 nitrogen trucks to oxygen trucks to augment logistics support to move liquid medical oxygen to multiple locations
- Medical grade oxygen cylinders: supplement capacity by the import of 7,000 cylinders for medical grade oxygen
