ArcelorMittal S.A. (MT): history, ownership, mission, how it works & makes money

A Brief History of ArcelorMittal S.A. (MT)

Formation and Early Years

ArcelorMittal S.A. was formed in 2006 through the merger of the world’s largest steel producer, Mittal Steel, and the European steel company Arcelor. Mittal Steel was founded in 1976 by Lakshmi Mittal, who played a crucial role in the formation of the company through a series of acquisitions.

Prior to the merger, in 2005, Mittal Steel reported production of 54.5 million tons of steel, while Arcelor produced 40.3 million tons in the same year.

Key Milestones

• 2006: Merger completed; ArcelorMittal became the largest steel producer globally.
• 2007: Acquired a 60% stake in the Canadian company, Algoma Steel.
• 2010: Announced an investment of approximately $4 billion to acquire Masreal Holdings.
• 2011: Acquired a controlling stake in the Brazilian company, Gerdau’s Long Steel, for $4.2 billion.

Financial Performance

As of 2022, ArcelorMittal reported total revenue of approximately $76.4 billion and an EBITDA of $18.2 billion. The net income for the year was $12.3 billion.

In the first quarter of 2023, the company reported a revenue of $20.1 billion alongside an EBITDA of $4.7 billion.

Global Presence

ArcelorMittal operates in more than 60 countries and has an industrial footprint in over 18 countries. The company is known for its numerous production facilities, including:

Sustainability Initiatives

ArcelorMittal has committed to reducing its carbon emissions and aims to achieve net-zero emissions by 2050. The company plans to invest approximately $10 billion in green technology initiatives by 2030.

Acquisitions and Strategic Investments

Over the years, ArcelorMittal has made several strategic acquisitions:

• 2007: Acquired Arcelor for $33 billion.
• 2014: Purchased the Italian steel producer, Ilva, for $2.4 billion.
• 2019: Bought a majority stake in the South African company, Manganese Metal Company, for $400 million.

Market Position

As of late 2023, ArcelorMittal holds approximately 8% market share in the global steel market, making it one of the leading players in the industry.

The share price of ArcelorMittal (MT) was approximately $27.80 as of October 2023.

Challenges and Future Outlook

ArcelorMittal faces challenges including fluctuating raw material prices and various geopolitical situations. However, its focus on sustainable practices and technological advancements positions it well for future growth.

A Who Owns ArcelorMittal S.A. (MT)

Major Shareholders

The ownership of ArcelorMittal S.A. is characterized by a diverse range of institutional and individual investors, with key stakeholders playing significant roles.

• As of the latest data in 2023, the largest shareholder is Lakshmi Mittal, who owns approximately 37% of the company's shares.
• Other significant institutional investors include BlackRock, Inc. with approximately 5%, and Vanguard Group holding around 3%.

Ownership Breakdown

The following table outlines the major shareholders and their respective ownership percentages:

Geographic Distribution of Ownership

ArcelorMittal's shareholder base is not limited to any specific geography. The following is a summary of geographic distribution:

Stock Performance and Market Capitalization

As of October 2023, ArcelorMittal's stock (MT) has seen notable fluctuations, impacting ownership sentiment.

• Current market capitalization: $30 billion.
• Price per share: $27.50.
• 52-week range: $22.00 - $35.00.

Recent Shareholder Activism

Shareholder activism has also influenced ArcelorMittal’s strategic decisions. In 2022, proposals were made to enhance shareholder returns:

• Increase in dividend payouts by 10%.
• Share buyback program targeting $1 billion.

Governance Structure

ArcelorMittal maintains a governance structure that reflects its ownership landscape:

• Board of Directors comprises 15 members.
• Majority of directors are independent: 10 out of 15.
• Committees include Audit, Risk, and Remuneration committees.

ArcelorMittal S.A. (MT) Mission Statement

Mission Statement Overview

The mission statement of ArcelorMittal S.A., as one of the world's leading steel and mining companies, emphasizes sustainable development, operational excellence, and a commitment to value creation while respecting the environment and contributing to communities. The company's vision is to be the world’s leading steel and mining company, based on safety, quality, and sustainability.

Core Values

• Safety: Prioritizing the safety and health of employees and communities.
• Integrity: Conducting business with respect and transparency.
• Sustainability: Committing to environmental stewardship and sustainable practices.
• Innovation: Driving efficiency and competitiveness through technological advancements.
• Excellence: Striving for operational excellence in every aspect of the business.

Financial Performance

As of fiscal year 2022, ArcelorMittal reported the following financial highlights:

Commitment to Sustainability

ArcelorMittal’s commitment to sustainability reflects its dedication to reducing carbon emissions and promoting the circular economy. Key targets include:

• Achieving carbon neutrality by 2050.
• Reducing CO₂ emissions intensity by 25% by 2030.
• Investing $10 billion in decarbonization initiatives by 2030.

Strategic Initiatives

The company’s strategic initiatives revolve around innovation, technology, and sustainability, focusing on:

• Development of advanced high-strength steels.
• Implementation of digital technologies in production processes.
• Participation in global sustainability initiatives and partnerships.

Global Presence

ArcelorMittal operates in over 60 countries with a workforce of approximately 168,000 employees. The company’s operational facilities include:

Market Position

In 2022, ArcelorMittal was ranked as the largest steel producer in the world, with a total crude steel production of 71.5 million metric tons.

Stakeholder Engagement

ArcelorMittal actively engages with its stakeholders, including employees, customers, suppliers, and local communities, to ensure alignment with its mission and values:

• Regular dialogues and feedback mechanisms.
• Community investment programs.
• Partnership with educational institutions for workforce development.

How ArcelorMittal S.A. (MT) Works

Company Overview

ArcelorMittal S.A. is the world's leading steel and mining company, with operations in over 60 countries. As of 2023, it reported crude steel production of approximately 63 million tonnes.

Financial Performance

In the fiscal year 2022, ArcelorMittal recorded revenues of $79.4 billion, with an EBITDA of $16 billion. The company's net income for the same period was $10 billion.

Operational Structure

ArcelorMittal operates through four key segments: Flat Carbon Steel, Long Carbon Steel, Stainless Steel, and Heavy Plate. Each segment has specific geographic and operational focuses.

• Flat Carbon Steel: Europe, North America, Brazil, and South Africa
• Long Carbon Steel: Europe, North America, and Latin America
• Stainless Steel: Europe and Asia
• Heavy Plate: Europe and North America

Raw Material Production

As of 2023, ArcelorMittal is one of the largest iron ore producers globally, with an annual production capacity of approximately 60 million tonnes.

Market Strategy

ArcelorMittal's strategy emphasizes sustainability and technological advancement. The company aims to reduce carbon emissions significantly, targeting a 25% reduction by 2030.

Recent Developments

In 2023, ArcelorMittal announced a $1 billion investment plan to enhance its steel plants in Europe, focusing on modernizing facilities and improving energy efficiency.

Global Footprint

ArcelorMittal has a diverse geographical presence. The company's operational facilities are strategically located in the following regions:

• North America: 16 active plants
• Europe: 26 active plants
• South America: 10 active plants
• Africa: 4 active plants

Workforce

As of 2023, ArcelorMittal employs approximately 168,000 individuals worldwide, contributing to various aspects of its integrated operations.

How ArcelorMittal S.A. (MT) Makes Money

Revenue Streams

ArcelorMittal generates revenue through multiple segments, primarily driven by steel production and manufacturing. In 2022, the company reported total revenues of approximately $76.5 billion.

Steel Production

The steel production segment is the backbone of ArcelorMittal's operations, representing a significant portion of its revenue. In 2022, ArcelorMittal produced around 71.5 million metric tons of steel. The global average selling price of steel in 2022 was approximately $1,080 per ton.

Geographical Segments

ArcelorMittal operates in multiple geographical regions, contributing to its diversified revenue model.

• Europe: Approximately 30% of total revenues in 2022.
• North America: Accounts for about 22% of total revenues.
• South America: Represents nearly 17% of total revenues.
• Africa: Contributes around 12% of total revenues.
• Asia: Makes up approximately 19% of total revenues.

Operating Income

For the fiscal year 2022, ArcelorMittal had an operating income of approximately $14.1 billion, with an EBITDA margin of 18.4%.

Cost Management

The company strategically manages costs, with raw materials accounting for about 50% of total operating costs. In 2022, the total cost of goods sold was approximately $62.4 billion.

Investment in Technology and Innovation

ArcelorMittal invests in technology to improve efficiency and reduce costs, investing around $1.5 billion annually in research and development.

Dividend Distribution

In 2022, the company declared a total dividend of approximately $3.6 billion to its shareholders, reflecting a policy of returning wealth to investors.

Environmental Initiatives

ArcelorMittal is committed to sustainability, investing approximately $250 million in carbon capture and other sustainable production methods in 2022.

Market Conditions

The steel market is influenced by global demand, where growth in industries such as automotive and construction significantly impacts revenue. Recovery from the pandemic has resulted in an increase in demand, particularly in the first half of 2022.

Future Outlook

Market analysts project steel prices to stabilize, with an expected growth rate of 3% annually through 2025, indicating continued revenue growth for ArcelorMittal.