ArcelorMittal Galati’s profit rose by an annual 70% in 2008

ArcelorMittal Galati, the most important asset on the local market of the world’s steel market leader, controlled by Lakshmi Mittal, Chairman of the Board of Directors and Chief Executive Officer, ended 2008 with $226 million (€154.1 mln) worth of profit, some 70 percent higher year-on-year, and net sales worth $2.7 billion (€1.84 bln), less than the 2007 level, market sources told Business Standard. The company’s management declined to comment on the information, considering the financial results are preliminary, as yet unaudited and not final. “The year 2008 was an exceptional one for ArcelorMittal Galati, so that the crisis which exploded in the second half of the year could not substantially influence its annual result”, specialists on this market told Business Standard. Due to exceptional prices, ArcelorMittal Galati posted a profit worth €84 mln at the end of the first six months of 2008, triple the net result registered in H1 2007, while net sales stagnated. In 2007, the complex, part of the ArcelorMittal steel maker portfolio, posted net sales worth €2.08 bln and a profit of €97 mln. The decline on main client markets of the global steel industry - the auto industry, the shipyard segment, and the durable goods sector, is beginning to show its effects this year. At the end of 2008, ArcelorMittal’s management said that it is considering lowering production by one third in 2009 and reducing its staff, by initiating lists for voluntary layoffs, but the situation has worsened in the past weeks. A few days ago, the company announced it will put its 12,500 employees and managers on technical unemployment in 10-day rotating shifts to cut costs. The company’s management declined to provide exact figures regarding the drop in orders, and has only said that it is considering a liquid steel production of 1.4 million tons in 2009, down 75 percent from the 4.4 million tons registered in 2007.