ArcelorMittal Q2 net income dips 10 percent, sees China and auto supporting Q3

Luxembourg: ArcelorMittal today reported a 10 percent dip in net income for the second quarter ended 30 June, 2011, to $1.535 billion against $1.706 billion for the corresponding quarter last year, it said in astatement. Demand typically dips in the third quarter, the northern hemisphere summer, but sector earnings also face pressure from record production in China and demand capped by tighter monetary policy there and debt problems in Europe and the United States. For ArcelorMittal, spot prices usually affect earnings with a three to four-month time lag, meaning tighter margins in the second quarter will be reflected in third-quarter figures. [caption id=“attachment_49122” align=“alignleft” width=“380” caption=“For ArcelorMittal, spot prices usually affect earnings with a three to four-month time lag. Reuters”] [/caption] Total sales of the company grew to$ 25.126 billion in the reporting period from $20.154 billion in the April-June period last fiscal. “As expected, the company has delivered a strong performance in the second quarter of 2011, underpinned by higher steel selling prices,” ArcelorMittal Chairman and CEO Lakshmi N Mittal said. During the March quarter, the company had clocked a net income of $1.069 billion from total sales of $22.184 billion. The company said steel shipments and earnings per tonne in the second half of the year would be higher than in the second half of 2010, when a sharp slowdown drove ArcelorMittal into a final quarter loss. Total steel shipments for the three months ended June 30, 2011, stood at 22.2 million tonnes, compared to 22.3 million tonnes in the corresponding quarter last year. The company has increased its 2011 capex target by 10 percent from $5 billion to $5.5 billion “due to recently announced investments”. Agencies