Q3 2024 ArcelorMittal SA Earnings Call

[inaudible] ArcelorMittal

ArcelorMittal ArcelorMittal

Great. Good afternoon, everyone. This is Daniel Fairclough from the ArcelorMittal Investor Relations Team. Thank you for joining this call to discuss ArcelorMittal's performance and progress during the third quarter and nine months of 2024.

Leading today's call will be our group CFO Jimmy No Kristina.

Leading today's call will be our group CFO, Germino Cristino.

Before we begin I would like to mention a few housekeeping items as usual, we will not be going through the results presentation, which we published this morning on our website. However, I do want to draw your attention to the disclaimers on slide two of that presentation.

Before we begin, I would like to mention a few housekeeping items. As usual, we will not be going through the results presentation, which we published this morning on our website. However, I do want to draw your attention to the disclaimers on slide two of that presentation.

As usual.

Speaker Change #223: As usual, Gemwina will be making some opening remarks before we move on to the Q&A session. So if you would like to join the queue to ask a question, then please do press star one one on your keypad. Over to you Gemwina.

I'll be making some opening remarks before we move on to the Q&A session. So if you would like to join the queue to ask your question and please do press star one on your keypad.

Gemwina: Obviously you Jeremy.

Jeremy: Thanks, Danielle and welcome everyone.

Thanks, Daniel, and welcome, everyone.

Jeremy: As usual ill keep my remarks brief I want to focus on three key themes.

Jeremy: As usual, I will keep my remarks brief. I want to focus on three key themes.

Jeremy: Beginning first with safety.

Beginning first with safety.

Jeremy: Across our filler metal our people my telephone lines to improve our safety performance and achieve our goal of being fatality in serious injury three as quickly as we can.

Speaker Change #226: Across ArcelorMittal, our people are galvanized to improve our safety performance and achieve our goal of being fatality and serious injury-free as quickly as we can.

Speaker Change #226: We recently announced that the DSS blood safety audit has been completed culminating a clear set of six recommendations.

Jeremy: We recently announced that the DSS plus safety audit has been completed culminating a clear set of six recommendations.

Jeremy: Audit took nine months and we went right from top to bottom of the company.

Jeremy: The audit took nine months, and we went right from top to bottom of the company.

Jeremy: As we now move to the implementation phase because there is considerable work underway to transform the recommendations into very specific work plans.

Jeremy: As we now move to the implementation phase, there is considerable work underway to transform the recommendations into very specific work plans that are tailored to each business unit.

Jeremy: Thank you to each business unit.

Jeremy: His work plans will support us in our journey to zero.

These work plans will support us in our journey to zero.

Jeremy: Fatalities and safety results, we are striving for.

fatalities and safety results we are striving for.

Jeremy: Moving to our financial performance.

Moving to our financial performance.

Jeremy: I want to highlight the benefits of our diversification.

I want to highlight the benefits of our diversification.

Jeremy: Our resilient performance this quarter reflects the progress we have made to high grade our asset portfolio in recent periods.

Jeremy: Our resilient performance this quarter reflects the progress we have made to high grade our asset portfolio in recent periods.

Jeremy: We have sold or exited.

Jeremy: We have sold or exited several high-cost assets, assets that are clearly struggling in the current environment.

All high cost assets assets that are clearly struggling in the current environment.

Jeremy: At the same time, we have added new assets to our portfolio.

At the same time, we have added new assets to our portfolio that are well positioned to create value, not just in the good times, but in all market environments.

Jeremy: Well positioned to create value not just single good times, but in all market environments.

Jeremy: And our results are a clear testament to this progress.

And our results are a clear testament to this progress.

Jeremy: Despite the evidently challenging market conditions, our Salome total EBITDA per ton margin in the third quarter.

Despite the evidently challenging market conditions, Acelo-Metal EBITDA per ton margin in the third quarter of $118 per ton compares very favorably with our long-term averages.

Jeremy: $182 per ton compares very favorably with our long term averages.

Jeremy: A key part of our resilience is our diversification diversification across products end markets and geographies.

It is often underappreciated that North America is by far the biggest contributor to our EBITDA.

We have the leading franchise business in Brazil, where demand is very strong and this is supporting good momentum for domestic prices and margins and.

Plus we are exposed to India.

Jeremy: The fastest growing major economy globally.

Execution means that relative to our peers our results are showing more stability.

My final theme of the strategic execution.

Our defined capital allocation and returns policy continues to deliver value for our shareholders.

We are consistently investing to grow and develop the earnings capacity of our supplemental.

Since 2021, we have generated 20 billion of investable cash flows.

Jeremy: This has allowed us to fund our portfolio of high quality organic projects.

Take advantage of the best inorganic opportunities.

Jeremy: We returned almost $212 6 billion of capital to shareholders.

All while maintaining a very strong balance sheet.

Jeremy: We have so far cognition, three strategic growth projects and all are performing well.

Our Mexico Hot strip mill continues to deliver a better than expected contribution to our results.

New code New complex in Brazil delivered its first high quality quoted coil at the beginning of the quarter and then in September its first tones of Mcnally.

<unk> patented metallic coil that offers unparalleled corrosion protection.

Our one gigawatt solar wind project started supply of renewable energy to <unk> Si India in September.

But there is a lot more to come as our presentation deck shows we anticipate that our strategic growth projects will add a total of $1 8 billion of new EBITA.

1 billion of this will come over the next two years.

Regarding ethanol meter with a significant boost on top of the anticipated cyclical recovery.

And we continue to take advantage of our no valuation to our share buybacks.

During the third quarter, we bought back in all the $280 million up stock.

Jeremy: We have reduced the share count by almost 6% this year.

The total reduction to 37% over the past four years.

As all presentation shows our all in cash yield remains very favorable for shareholders.

Dividends and buybacks so far this year at $1 4 billion.

And we have another 200 million dividend payment due in the fourth quarter. The total yield so far this year, it's almost 8% of our current market capitalization.

Bought back 37% of the company this year, 6% as I was saying that in my opening remarks, and looking forward I mean of course the focus is first completing the remaining program.

Speaker Change: You have 12 million shares to buy.

Speaker Change: And I guess the message is that our products will not change so.

Speaker Change: And when I look forward.

Speaker Change: I'm very optimistic about the capacity of the group to continue to generate free cash flow, especially when we look at the projects that we talked about the fact that the commission background can you start with a renewable project in India that we're going to have Liberia, obviously, starting up soon.

Speaker Change: So we will have another $500 million of EBITDA coming through next year and another 500 in 2026 debt, providing a lot of comfort that the group should be in a position to continue to generate strong free cash flow.

Speaker Change: And our policy is as low as you know, 50% will be returned back to shareholders minimum 2%.

Speaker Change: So we're going to be closing the year with net debt at low levels well under control. So I think that place us very well to continue to.

Do any buybacks.

Speaker Change: We have the authorization from our shareholders.

Speaker Change: But let's first complete the existing program and then.

Discuss the second or the next the next program.

Speaker Change: Thank you very much anyway on the second question is on the Carb thing that has been very immaterial so far.

Speaker Change: Year to date, and I would say two or three years to date. Many investors are worried that we will hit the wall of spending into the end of the decade and so firstly do you still stand by your 10 billion targets through 2017, and then secondly, when are we likely to hear more about the specifics of your Descartes flat. Thank you.

Yeah.

Speaker Change: Hello, I the way I see that I think we have been doing quite a lot and.

Speaker Change: Where we are today I mean, we continue of course with our engineering work. So we continue to.

Develop that as we said in the previous quarter, we should be in a position to provide some more color.

Towards the end of the year.

Speaker Change: So that remains.

But look I think we have been doing quite a lot. So.

So we have <unk>.

And the one that we are building.

We have now a portfolio or two giga of our renewable projects, we talked about <unk>, we have another one in Brazil and Argentina.

Speaker Change: We are investing in <unk> in Spain. So we are going to be doubling the capacity currently current capacity of that facility.

Which is also a green steel.

Speaker Change: So I think we are doing a lot and then of course, we are which is extremely important here.

Speaker Change: To make sure that we have the right policies in place so that we can justify larger.

Speaker Change: The large investments in Europe, and we have been talking about that I think we have been very clear that.

Speaker Change: We need a number of things in place we need a strong seaborne we need strong protection to the industry. So that was swing bass. These assets will be in a position to compete.

Speaker Change: A level playing field.

Speaker Change: Thank you gentlemen, so basically a follow up to this question is do you stand by your $10 billion.

Speaker Change: Is it fair to say given we know what we know today.

Speaker Change: Yes, I think we are not changing that.

Speaker Change: That number remains our best guess.

Speaker Change: Thank you. Thank you very much.

Speaker Change: And just to remind everybody obviously, that's a gross number.

Speaker Change: Pre government funding.

Speaker Change: So on a.

Speaker Change: Awesome mutual basis, it would be about $5 billion.

Speaker Change: But we.

Speaker Change: We'll move now to the next question.

Speaker Change: Which we will take from Tom.

Speaker Change: Tom Zhang at Barclays. Please go ahead Tom.

Tom Zhang: Hi afternoon. Thanks for taking my questions two from me I'll take them one by one firstly.

Tom Zhang: First maybe just to usual.

Tom Zhang: Did you guys give quarterly raw material costs price and volumes by division if that's okay into Q4.

Speaker Change: Hi, Joe.

Speaker Change: Yes sure Jeremy.

Tom Zhang: So I think looking to the fourth quarter, we can go into more detail, if you'd like but 10 looks.

Tom Zhang: Looking at the fourth quarter, there were clearly some.

Tom Zhang: And there are some minuses, but I think the April picture is broadly similar to the third quarter.

Tom Zhang: So on the positive side of the equation and we should see the benefit of higher volumes in Europe.

Tom Zhang: Higher iron ore shipments and then.

Tom Zhang: And then on the other side of the equation and we will have the impact of lower spot prices, particularly in North America, and then seasonally lower shipment volumes in Brazil, So as I say, some pluses and minuses at the overall picture broadly similar to the third quarter.

Speaker Change: Got it. Thank you and then just the second one was.

Speaker Change: Yes.

Speaker Change: It's a bit early to start talking about it but.

Speaker Change: At the moment until the <unk> is up and running you did have upstream you would help the corpus Christi assets Cri, but east 40, 50% of the U S. MCA.

Speaker Change: Sales number for you is still in the U S <unk>.

Speaker Change: <unk>, I guess from Mexico and Canada.

Speaker Change: One is that number roughly right sort of 40%, 50% and then can you just talk about any backup options that you guys have already been thinking about it.

Speaker Change: Under the new administration materials start to become more difficult said that particularly for Mexico.

Speaker Change: Yes, Tom.

Speaker Change: I.

Speaker Change: I said I think it's early days right.

Speaker Change: And what we what we saw in the first step of President Trump he wasn't extremely supportive to the industry.

Speaker Change: It was also I think a lot of what we see happening and you asked whether it comes from the fact that he put in place section through 30 true.

Speaker Change: Renegotiated NAFTA agreement across now U S. MCA was part of his legacy.

Speaker Change: It was all very supportive to the industry in U S and North America overall.

Speaker Change: We saw the consequences of that are in other parts of the world as well.

Speaker Change: So we hope that.

Speaker Change: As he comes back now and he's doing his second term.

Speaker Change: We will probably most likely see that support continuing.

Speaker Change: And it will be very interesting to see also how the all the reasons noted governments respond to respond to that.

Speaker Change: So I think it's early days to talk about that.

Speaker Change: Close between Mexico, Canada to the U S and vice versa. The way, we see it today to close.

Speaker Change: A very they are on a similar basis when you look at Canada.

Speaker Change: Mexico and U S.

Speaker Change: But I think what we'll have to wait and see how how how it develops.

Speaker Change: Okay fair enough. Thanks, I'll turn it back.

Paul: Great. Thanks, Paul.

Speaker Change: Sure.

Speaker Change: Move to the next question.

Speaker Change: <unk>, which we will take from Patrick.

Speaker Change: Think of America, Hi, Patrick go ahead.

Patrick: Hey, good afternoon, thanks, very much for the opportunity can you maybe just touch a little bit on how we should think about the automotive business going into next year or so.

Speaker Change: Spot prices are a little bit lower so how should we think about that aspect of in particular Europe.

Speaker Change: Sort of pricing into next year and I suppose given the backdrop that it looks.

Speaker Change: A lot of auto suppliers are under a lot of pressure and we are seeing a lot of restructuring a lot of it look structural rather than cyclical.

Speaker Change: So maybe just a bit of context, how important is that business to Europe.

Speaker Change: And how should we think about it into 2025. Thank you.

Speaker Change: Yes.

Speaker Change: Yeah. So.

Speaker Change: That's right.

Speaker Change: Patrick that's a.

Speaker Change: The benefit of our diversification so when we look at our auto business in 2020 for what we see is as you all know.

Speaker Change: We have gone through some destocking in Europe, So our production in Europe will be lower compared to the previous year.

Speaker Change: But at same time, we are seeing growth in Brazil, and Argentina, we are and we are seeing more stability really in North America.

Speaker Change: So when we look at our business as a whole there are pluses and minuses right.

Speaker Change: Looking forward our.

Speaker Change: Our base case today is that we're going to see some stability in terms of volumes compared to this year.

Speaker Change: And when it comes to prices of course, it's too early we have not yet really started all of these negotiations but.

Speaker Change: But our focus is the same varieties to makes sure I mean as you know we invest heavily in making sure that we develop the grades.

Speaker Change: We have the technology that will help support the Oems with Vale objectives.

Speaker Change: And our focus is make sure that we are rewarded for that so our focus is more on the margin that we can see Q.

Speaker Change: As we signed these contracts. So we remain of course optimistic that there's not going to change that we'll be able to sign contracts that will reward the company for.

Speaker Change: The investments are.

Speaker Change: We may make.

Speaker Change: Got it. Thank you and then if I could I have a follow up piece just on sustainable solutions can you give us an.

Speaker Change: An update on that business.

Speaker Change: Obviously revenue is down year on year, and it's a it's an area that you were looking to grow so just thinking about how do you think about that going forward. Some steel would be helpful. Thank you.

Speaker Change: Sure Yeah, I think you'll see a decline in quarter, three which to some extent is also linked to seasonality, we expect to be doing better in Q4.

Speaker Change: More importantly.

Speaker Change: As we have the one giga renewable projects that we talked about so that's the labs.

Speaker Change: Close to $100 million next year to our sustainable solutions. So we talked about and you can see now that some other renewable projects that we started in Brazil. So that will continue to support we.

Speaker Change: We have completed the acquisition of our construction.

Speaker Change: <unk> business in Europe. So that will also provide support next year. So I think we are on track to double the profitability of this segment over the next couple of years.

Speaker Change: Thank you.

Speaker Change: Okay.

Speaker Change: Yes.

Speaker Change: Okay.

Speaker Change: Yes.

Speaker Change: Hi, Jamie I'm, sorry about that my my system, just crushed and.

Speaker Change: But.

Speaker Change: No problem.

Speaker Change: So I think we're ready to take the next question which is.

Speaker Change: From Andrew I'd say UBS Hi, Andrew go ahead.

Speaker Change: Yes.

Speaker Change: Thanks Danielle.

Speaker Change: Yes, just to push a bit more on one of the previous questions around <unk> and just how you think about.

Speaker Change: When you basically presby bestbuy trigger maiden you mentioned you'd like to see.

Speaker Change: Our strong.

Speaker Change: Obviously, we've got a structure in place with them.

Speaker Change: What more you want to see from the.

Speaker Change: The structure of that too.

Speaker Change: Cause you to invest in.

Speaker Change: What are the factors are you looking for in particular I E. Do we need to see more on the infrastructure side wherever it comes to hydrogen whether it comes whether we're talking about.

Speaker Change: Sufficient renewable energy.

Speaker Change: Factors are you looking for before you actually pull the trigger and is that a scenario where.

Speaker Change: If you don't see that.

Speaker Change: Patient return on capital and you don't see that support on some of those projects and the higher cost jurisdictions in terms of energy, such as Germany, or Belgium, Israel.

Speaker Change: Synovia, where you just do not spend that money and you actually.

Speaker Change: To achieve on these assets to cash and debt.

Speaker Change: Yeah.

David: David its investments.

David: Is that a realistic scenario.

Speaker Change: Yeah.

Speaker Change: Andrew.

Speaker Change: I think that that's from all the points right. So I think it's been as I said I mean, I think it's very important that as we embark on some of these projects that we.

Speaker Change: We can be sure that we're gonna be remain competitive right and that the outflows will be able to do we want to be able to run the assets and be competitive and put out today as we know.

Speaker Change: The competition in Europe is not bad.

Speaker Change: We are being pursued to causes that nobody else in Spain.

Speaker Change: Do you have the high energy cost as we don't have yet the availability of renewable power sufficient.

Speaker Change: Hydro insurance, so I think you touched on all the points that I think it's also a cleared through all the governments.

Speaker Change: That is really what is required for the industry to be able to shrink bags first of all I think we need to have strong protection in Europe.

Speaker Change: Cause we have China, we just saw the numbers right of October numbers from China, Florida.

Speaker Change: Exports, so I think that needs to be taken very seriously at them quickly by be by.

Speaker Change: By the authorities in Europe.

Speaker Change: And across the world are quite quite frankly.

Speaker Change: So until we see we can see that and it's very hard really to take a decision to join twin pass and we are hopeful that we'll see progress.

Speaker Change: We have the pause we view a C bond coming up soon and we will see finally, what the government takes into account so that any sense you can see.

Speaker Change: Europe is also very active in ensuring the needs and what needs to happen. So that we can have again.

Speaker Change: A level playing field in Europe again, I think the competition today is just not buckhead.

Speaker Change: Okay, that's clear and just a second question on.

Speaker Change: Ilva, obviously, it's no longer your assets, we've seen news about restarting blast furnaces that talking about ordering DIY equipment. It seems.

Speaker Change: Things are moving that's going to be more volume in the market.

Speaker Change: All of that in the near term and into next year.

Speaker Change: Steve longer term if they build that DIY capacity are you to what extent you're concerned about.

Speaker Change: That supply growth coming at us out of obviously weak demand.

Speaker Change: Yeah look to be honest, Andrew our number one concern right now is imports as I said I think the level of imports in Europe are just too high.

Speaker Change: And that should be the intermediate the first priority is to get that under control and that's really.

Speaker Change: What are the most critical piece for us.

Speaker Change: Okay.

Speaker Change: Okay.

Speaker Change: Thanks.

Speaker Change: Thanks, Amit so I'll leave that to the next question.

Speaker Change: And we'll take that question from Dominic.

Speaker Change: J P Morgan.

Speaker Change: Go ahead Tony.

Tony: Hi, guys. Thanks for taking my question just some simple questions just on working capital for Q4 is it reasonable to assume that we see a full unwind of the $1 $5 billion that you've built so far.

Tony: And the first nine months of the year.

Tony: Second question similar question on on the previous question around Capex, but if I, if I look away from the Cob Capex, specifically I'm looking at the regions Europe first nine months still about 50% of your Capex. As you look into 2020 full are you seeing opportunities to maybe bring down some of the European capex or is that.

Speaker Change: Not on the agenda.

Speaker Change: Yes that was my two questions. Thank you.

Speaker Change: Yeah.

Speaker Change: So on the working capital you're right I mean, that's all our guidance that we should really is.

Speaker Change: A similar number as we have invested up to now.

Speaker Change: And I'm doing this very carefully because as we have.

Speaker Change: I pointed out in our release at some point, we're going to see a cyclical recovery right and.

Speaker Change: So we want to make sure that the business.

Speaker Change: Well funded they have the working capital that they need as and when we see it as a cyclic.

Speaker Change: Cyclical rebound.

Speaker Change: Hum.

Speaker Change: One on Capex.

Speaker Change: I think it's that important to your point because when you look at the data that you generate in Europe, you see the Capex that you can see that all the segment as well.

Speaker Change: We are generating levels, good levels or different levels of free cash flow in Europe.

Speaker Change: But you should also we can talk about that in more detail, but he also has a growth capex and you're right and that's basically pretty our new electrical steels project and Marty that we're investing so we're gonna be completing the first phase of the project towards the end of this year and then that is the second phase.

Speaker Change: That will happen in 2020.

Speaker Change: That's fine.

Speaker Change: But overall, if I can talk about Capex for next year.

Speaker Change: You can see now that you have basically three components.

Speaker Change: Always spectation is one of course being in a position to update you more as we complete the budget at the our strategy starts with the cycles.

Speaker Change: And in our Q4 numbers will be in a position to update you with more precision, but our expectation at this point in time is that the Capex number for next year will not change significantly.

Speaker Change: Thank you very clear.

Speaker Change: Great. Thanks, Dominic So we'll move to our next question and we'll take that from Paris at Kepler Cheuvreux.

Speaker Change: Please go ahead.

Speaker Change: Hello, Thank you for taking my question.

Speaker Change: The first one is on Europe.

Speaker Change: It's going to be priced.

Speaker Change: The mounting of resilience.

Speaker Change: We see all the while we've seen a lot of buildings. So I suppose you already answered part of it.

Speaker Change: In this context, we see that more and more M&A in Europe with partnerships.

Speaker Change: <unk> made an announcement about one of its kind shareholders.

Speaker Change: Planning to make a takeover bid.

Speaker Change: Just in crude.

Speaker Change: Trying to form partnerships with Kwiecinski BCG. So I was wondering if you had some.

Speaker Change: Some Toyota opportunity therefore for some of your assets.

Speaker Change: You started to see some opportunities.

Speaker Change: And Oh.

Speaker Change: My second question on the M&A front.

Speaker Change: News flow about something.

Speaker Change: So I'm interested in your South African asset so could you elaborate if you can comment on those vehicles.

Speaker Change: Thank you.

Speaker Change: Yeah.

Speaker Change: So first.

Speaker Change: On Europe I think we are pleased with our performance in Europe and the teams are doing a great job operation on the reliability.

Speaker Change: Can see that we are running our financed as well so that of course supports our costs, we can bring costs down.

Speaker Change: So we can achieve our management gains I think teams are doing a very good job in this very challenging market conditions, having said that in terms of M&A I think we are we are.

Speaker Change: We're happy with our footprint.

Speaker Change: So that's oh, that's the bottom line.

Speaker Change: And in South Africa.

Speaker Change: We are not contemplating any any any any change there.

Speaker Change: Okay. Thank you.

Speaker Change: Great. Thanks Bruce.

Speaker Change: Well take the next question not so we'll move to trusted BMP power about please.

Speaker Change: Please go ahead Tristan.

Tristan: Yeah, Hi, Thank you for taking my questions.

Tristan: First one is on North America could you remind us the volumes and the type of products you ship to the U S.

Tristan: From Mexico from Canada from Canada from Europe, and Brazil, Please and also if with Trump.

Speaker Change: Getting back Terrace against Mexico, what are your options to mitigate that risk.

Speaker Change: Flexible can you be more specific to you regarding the U S trade case against Canada Hot dip galvanizing ports how.

Speaker Change: How confident are you that Canada will not face terrorist here I start there.

Speaker Change: Yeah look I mean, we have to wait for the outcome of the investigation Ryan. So of course, we will call Greg will be able to be part of the process.

Speaker Change: So.

Speaker Change: Of course, what we felt from Canada into the U S. These are contracts that I'm thankful momentum and yes.

Speaker Change: Mostly through the Oems so.

Speaker Change: So we don't believe that cause any injury.

Speaker Change: Of course, we will participate in <unk> and we will have to wait to see.

Speaker Change: How it plays out and then.

Speaker Change: You know I think you know very well close so we bring slabs to covered from our Mexico and Brazil, we buy it so I'm also domestically.

Speaker Change: And we won't have a pause.

Speaker Change: Now coming up so that will be.

Speaker Change: An extremely positive for operations in U S. So we will have melted and who are in steel.

Speaker Change: One 5 million tons will give us be it.

Speaker Change: We will have capabilities to do exposed box and we won't have everything that is required for that so that should provide a good boost to our oh operations in U S.

Speaker Change: But a call but of course, we still need to buy the glass.

Speaker Change: So at this point in time I think it's too early to talk about Oh, we have auctions right. So we have Mexico, which is part of the North America product with MCA have Brazil, and and we have all the auctions as well we can bring our materials from Europe. If you have true but at this point in time I think it does.

Speaker Change: Too early.

Speaker Change: Great on that.

Speaker Change: Okay and could you share the slab supply that you're getting for Calvert at the moment, how much volume's coming from Mexico and Brazil.

Speaker Change: I don't think it's something that we are disclosing them.

Speaker Change: Okay.

Speaker Change: And my second question is on Europe.

Speaker Change: Again on the card.

Speaker Change: So when you talk about positive free cash flow past 2024.

Speaker Change: Should we think it has a firm target that you absolutely want to achieve or is more kind of an aspiration you took about the level playing field, but let's say would you be okay. If down the line. There is a level playing field that require investment they require you to be negative free cash flow for a couple of years, that's something that you could contemplate or.

Speaker Change: You really want to be in that positive free cash flow set up for the medium term.

Speaker Change: That has to be the objective truth, then of course, we want our business to be.

Speaker Change: It can be sustainable I think that scheme, Brian Tim Goss sustainability is really the key the key what if we feel that we have a sustainable business a strong business. We are prepared to invest in and that's why we have always always been so Europe is it's an important market. It's a it's a big market and I'm not.

Speaker Change: Wind could disappear right. So I think it's so.

Speaker Change: So we have to get through.

Speaker Change: As long as we have the right conditions.

Speaker Change: Thank you and maybe just a quick last one Mexico, you mentioned that the yes, sorry that was there a blast furnace outage as well Gee to describe to you has it restarted already.

Speaker Change: Yeah. So in massacres annoying the biggest part of the business as the direct business, which has started immediately almost immediately after the end of the blockade was mid July so that is up and running.

Speaker Change: The blast funding, which is a smaller part of the business has not yet started he should be started anytime soon.

Speaker Change: I used the blast furnace, it's Uh huh.

Speaker Change: <unk> done a bonus it's I, it's a small finance.

Speaker Change: And to do it safely we have to go.

Speaker Change: Go through some maintenance work.

Speaker Change: And that's why it's taking a bit longer.

Speaker Change: But we should be in a position to start that.

Speaker Change: Next day.

Speaker Change: Perfect. Thank you very much.

Speaker Change: Great. Thanks Kristen.

Speaker Change: So we've got.

Speaker Change: Two more questions. Jeremy note. The first we will take from a match.

Speaker Change: It got among sex. Please go ahead Max can Harris.

Speaker Change: Thanks, Dan and good afternoon.

Speaker Change: First I was just on Brazil.

Speaker Change: The positive PC that you've seen this quarter I guess some of thats the tariffs flowing through but just interested on.

Speaker Change: You are also ramping up the Vega CMC.

Speaker Change: I guess into year end and just trying to think about 2025.

Speaker Change: You stated that this project should bring a $100 million EBITDA, but I think thats on a more normalized basis. So as we stand today is there upside or downside to that number and can you just provide some color as to the timing as to when we could see that full ramp up delivered.

Speaker Change: Yeah.

Speaker Change: There hasn't been any is probably a good number for next year. We are very pleased with the ramp up of the facility. It's.

Speaker Change: It's being done on a record basis I would say.

Speaker Change: We should be closing the year already probably around 80%. So I think the 100 and then it's Oh.

Speaker Change: It's a good number for you to take them through your models for next year in Brazil. We are pleased of course with the overall performance in Brazil, I mean Q3 was really great.

Speaker Change: Economically the country is doing well GDP is strong this year.

Speaker Change: We have low unemployment rates.

Speaker Change:

Speaker Change: It's a it's a good setup right now so apparent steel consumption will grow well this year.

Speaker Change: So it's it's a it's a good setup at the moment.

Speaker Change: Okay. That's great. Thank you and then Tim.

Speaker Change: Moving on to library itself, it looks like Youre delivering first concentrate this.

Speaker Change: I guess this quarter say.

Speaker Change: How is the commissioning of the concentrate again can you just provides country has to has it performed in line with expectations in terms of product quality.

Speaker Change: And diesel standby I guess, the ramp up of that expansion into next year.

Speaker Change: Yeah. So the focus is of course on the project that everybody is focused on that and I haven't even plus concentrate end of this year.

Speaker Change: So as you can imagine it's a large project.

Speaker Change: A lot of challenges, but we are progressing we feel optimistic.

Speaker Change: So let's see how it all we have.

Speaker Change: It goes.

Speaker Change: But that's an important project for us. So as you know we have three models. So let me start with 5 million tons and then we'll have a second one and third one and 2025.

Speaker Change: So we remain optimistic that we're gonna be in a position to start to see significant contribution from Liberia next.

Speaker Change: Next our next year.

Speaker Change: That's great. Okay. Thank you and thanks.

Speaker Change: Squeeze one last hypothetical question with Calvert and.

Speaker Change: I guess, just having full ownership and I guess importantly, operator ship ignoring tariffs in order to maybe thoughts out there at the moment, but having this asset and in control of this asset does this unlock any synergies that.

Speaker Change: Across the broader North America no.

Speaker Change: Sort of Mattel portfolio.

Speaker Change: You can maybe touch on.

Speaker Change: As we know covered is the most capable of finishing facility in North America right. It's.

Speaker Change:

Speaker Change: Uh huh.

Speaker Change: It makes of course.

Speaker Change: Good SaaS for us to own 100% of the answer to the extent that Nippon has to have to divest.

Speaker Change: But having said that this is not really about synergies.

Speaker Change: It's just about.

Speaker Change: Owning 100% of disaster than a region that is very important for us in the middle.

Speaker Change: And we've talked about in the past projects that we are developing right now for the region.

Speaker Change: And so.

Speaker Change: So to the extent that.

Speaker Change: And if one can completely on transaction, we will be pleased to own 100% of carbon.

Speaker Change: That's great.

Speaker Change: That's all for me thank you.

Speaker Change: Alright, Thanks, Bob.

Speaker Change: So we will take our last question now Jeremy and I will take it from Max.

Speaker Change: So please go ahead Max.

Speaker Change: And good afternoon.

Speaker Change: First question is on kind of a precisely can you talk us through the financial implications of the deal because Nippon steel highlighted circa $1 5 billion negative impact on the balance sheet should we expect the same kind of fit in.

Speaker Change: Impact on your own balance sheet positively this time and can we just add the current EBITDA contribution as reflected in the in the disclosure that you give to your own EBITDA.

Speaker Change: Is there some kind of.

Speaker Change: Elimination, we should do to take into account.

Speaker Change: This is a slap shipments from Brazil and from Mexico.

Speaker Change: Yeah, Mexico, what I suggest we do is let us let us.

Speaker Change: That is waiting to see.

Speaker Change: What does the transaction closed and then we're going to be in a position to.

Speaker Change: Walk you through would be the accounting implications clearly we don't we don't have any any any 5000 impairments fire.

Speaker Change: But let's wait until the transaction closes and then we can.

Speaker Change: Walk you through.

Speaker Change: The accounting implications of the transaction.

Speaker Change: Okay. That's fair and so one question is on value. Rick I think you were between 10, so far to give them more color on the synergies is noncash and that closed this acquisition, which was the case at the last results presentation in July but now that you have.

Speaker Change: Close the deal.

Speaker Change: Can you talk us through the same the same way off.

Speaker Change: <unk> you expect to achieve on them and direct them I mean, as you know that the company now for a few months.

Speaker Change: Have you progressed in that direction.

Speaker Change: Well.

Speaker Change:

Speaker Change: Well, what I would say is that we are we are pleased with the acquisition mix. We are what we see today. It's in line with our expectations. So the company continues to perform well.

Speaker Change: So no no no no bad news so that's good news.

Speaker Change: And asked me discuss I mean, this is not a transaction that was done.

Speaker Change: Based on C. N N strike because we are a minority shareholder we have of course, an important stake, but still we are a we have a minority.

Speaker Change: So we don't have the control so.

Speaker Change: So all we're doing is of course, we are all can work together, we have are areas, where we have a when they are present, we are present and to the extent that we can work together with them to the extent that it's a win win that it could fall below that shareholders could force kilometre shareholders.

Speaker Change: We're gonna be open to explore but at this point in time.

Speaker Change: I don't have anything to report to you on that front.

Speaker Change: Okay, That's fair and the last one is on Ukraine, So as opposed to feature the truth, but there's also a possibility for a separate listing filter.

Speaker Change: Notably the city of booklets isn't the threat from Russia and its main call center in the region are you sourcing Nielsen some some code from disappeared from this mine and could you be able to offset those.

Speaker Change: So shipments with him with another supplier.

Speaker Change: Supply and perhaps muted does that job just idled one person is there.

Speaker Change: You had just reopened it so can you explain why you did them.

Speaker Change: Kind of step back there.

Speaker Change: Yeah, well as we know the situation in Ukraine.

Speaker Change: It's volatile and it's.

Speaker Change: It's changing every day. So I think the teams are doing the best they can.

Speaker Change: What we experienced more recently is that the price of and engineering has been very high.

Speaker Change: And therefore, we are just optimizing the flows the production so to say on energy costs. So that's why you're going to see this volatility in terms of production.

Speaker Change: As long as the situation.

Speaker Change: Laughs.

Speaker Change: And so.

Speaker Change: So we do have the possibility to bring raw materials from different sources that happens with the scenario that you just described.

Speaker Change: So we have the connections Poland. We have the report is all been rising so we do have possibilities.

Speaker Change: If we lose connection with that part of the country.

Speaker Change: Okay. That's clear so thank you.

Speaker Change: Thanks Pat.

Speaker Change: We've got time for one follow up question I Hope, Jim We know so we will take that from Bastian at Deutsche Bank.

Speaker Change: Hi, Bastian. Please go ahead with your follow up.

Speaker Change: Yes, good afternoon, all and thanks for taking my question I wanted to ask a quick one which is a follow up on Ukraine. So can you maybe just remind us what is the capacity you have available there at the moment and if you would go from where you're currently running to full capacity is there any major investments needed at this point.

Speaker Change: And then related to that maybe could you put this into the context of the white I guess Ukrainian context in terms of what the capacity been has their people the way you perceive it and basically how much capacity is available there in the broader market versus what unfortunately, obviously has been taken out that was all my questions.

Speaker Change: Yeah.

Speaker Change: Boston, we are so we are running two bonuses at the moment, we are running one finance so you're running at about as I said at about 40% so and so.

Speaker Change: Shortly before the wall we warm.

Speaker Change: North of 4 million tons or $4 5 million tonnes.

Speaker Change: So we do have the possibility to increase capacity from 40 to maybe 70% and then beyond that point that would require some investments right. So.

Speaker Change: So clean and we have the potential with and to ramp up if we if we see the conditions. If we see markets if it makes economic sense.

Speaker Change:

Speaker Change: But that's a that's a that's the situation right now.

Speaker Change: Okay. Thank you and I guess people think Ukraine has been pretty much like a 'twenty 'twenty 2 million tonne production country hub.

Speaker Change: I mean, how do you see the feasibility of the Hawaii market now given the current situation.

Speaker Change: It was before but it's it's all it's all yes, it's very <unk> in Boston.

Speaker Change: As we normally in a big part of the industry was destroyed right. So.

Speaker Change: And that has not changed.

Speaker Change: So.

Speaker Change: The market sorry, I have to say I mean, it's it's fragile the everybody is facing the same situation, we have high energy costs, which has been.

Speaker Change: <unk> holding.

Speaker Change: The developments there. So I think we have to wait a bit to see how things stabilize.

Speaker Change: Great.

Speaker Change: Hope for.

Speaker Change: For peace and that weekend, we start reviewing the country.

Speaker Change: Okay understood. Thank you.

Speaker Change: Thank you Bastian so that's our last question gentlemen.

Speaker Change: I hand back the call to you for any closing remarks.

Speaker Change: Thank you Daniel and thank you everyone before we close I want to reiterate my message from the beginning of the call.

Speaker Change: The whole Arcelor Mittal organization is galvanized to improve safety performance set.

Speaker Change: Currently only resilient results in the face of challenging markets continued to demonstrate the structural improvements.

Speaker Change: Returning significant capital to shareholders at the bottom this cycle, while continuing to invest in growth is clear evidence of the progress Arcelormittal has made.

Speaker Change: There is much to anticipate.

Speaker Change: All projects had good momentum and we will provide unique upside to EBITDA and cash flows on top of any cyclical recovery.

Speaker Change: If you need anything further please do reach out to Daniel and his team and I look forward to speaking with you soon.

Speaker Change: And it goes around you say that's well thank you very much.

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Speaker Change: Good afternoon, everyone. This is Daniel Fairclough from the US <unk> Investor Relations team. Thank you for joining this call to discuss houseware Mitchell's performance and progress during the third quarter and nine months of 2024.

Speaker Change: Leading today's call will be our group CFO Jeremy No Kristina.

Speaker Change: Before we begin I would like to mention a few housekeeping items as usual, we will not be going through the results presentation, which we published this morning on our website. However, I do want to draw your attention to the disclaimers on slide two of that presentation.

Speaker Change: As usual.

Speaker Change: I'll be making some opening remarks before we move on to the Q&A session.

Speaker Change: I would like to join the queue to ask a question then please do press star one on your keypad.

Speaker Change: Obviously you Jeremy.

Jeremy No: Thanks, Danielle and welcome everyone.

Speaker Change: As usual I'll keep my remarks brief I want to focus on three key themes.

Speaker Change: Beginning first with safety.

Speaker Change: Across some of them it all our people in my telephone lines to improve our safety performance and achieve our goal of being fatality in serious injury three.

Speaker Change: Quickly as we can.

Speaker Change: We recently announced that the TSS blood safety audit has been completed culminating a clear set of six recommendations.

Speaker Change: And it took nine months.

Speaker Change: And we went right from top to bottom of the company.

Speaker Change: As we now move to the implementation phase because there is considerable work underway to transform the recommendations into very specific work plans.

Speaker Change: Thank you to each business unit.

Speaker Change: His work plans will support us in our journey to zero.

Speaker Change: Fatalities and safety results, we are striving for.

Speaker Change: Moving to our financial performance.

Speaker Change: I want to highlight the benefits of our diversification.

Speaker Change: Our resilient performance this quarter reflects the progress we have made to high grade our asset portfolio in recent periods.

Speaker Change: We have sold or exited.

Speaker Change: It'll high cost assets assets that are clearly struggling in the current environment.

Speaker Change: At the same time, we have added new assets to our portfolio.

Speaker Change: Well positioned to create value not just single good times, but in all market environments.

Speaker Change: And our results are a clear testament to this progress.

Speaker Change: Despite the evidently challenging market conditions Arcelormittal EBITDA per ton margin in the third quarter.

Speaker Change: $118 per ton compares very favorably with our long term averages.

Speaker Change: A key part of our resilience is our diversification.

Speaker Change: Diversification across products end markets and geographies.

Speaker Change: Is often underappreciated that North America is by far the biggest contributor to our EBITDA.

Speaker Change: We have the leading franchise business in Brazil, where demand is very strong and does it support and good momentum for domestic prices and margins.

Speaker Change: Plus we are exposed to India, the fastest growing major economy globally. This discussion means that relative to our peers. Our results are showing more stability.

Speaker Change: My final theme of the strategic execution.

Speaker Change: Our defined capital allocation and returns policy continues to deliver value for our shareholders.

Speaker Change: We are consistently investing to grow and develop the earnings capacity of our supplemental.

Speaker Change: Since 2021, we have generated 20 billion of investable cash flows.

Speaker Change: Has allowed us to fund our portfolio of high quality organic projects.

Speaker Change: Vantage of the best inorganic opportunities.

Speaker Change: Almost $212 6 billion of capital to shareholders, all while maintaining a very strong balance sheet.

Speaker Change: We have so far cognition, three strategic growth projects and all are performing well our.

Speaker Change: Our Mexico Hot strip mill continues to deliver a better than expected contribution to our results.

Speaker Change: New Cold mill complex in Brazil deliberate it's.

Speaker Change: High quality quoted coil at the beginning of the quarter and then September its first homes of Mcnally's ocelot metals patented metallic coil that offers unparalleled corrosion protection.

Speaker Change: And our one gigawatt solar wind project started supply renewable energy to Aam's Si India in September.

Speaker Change: But that is a lot more to come.

Speaker Change: Our presentation deck shows.

Speaker Change: Anticipate that always strategic growth projects will add a total of $1 8 billion of new EBITA.

Speaker Change: 1 billion of this will come over the next two years, providing us with a significant boost on top of the anticipated cyclical recovery.

Speaker Change: And we continue to take advantage of our low valuation to our share buybacks.

Speaker Change: During the third quarter, we bought back another $280 million of stock.

Speaker Change: We have reduced the share count by almost 6% this year.

Speaker Change: Bringing the total reduction to 37% over the past four years as.

Speaker Change: As all presentation shows our all in cash yield remains very favorable for shareholders.

Speaker Change: Dividends and buybacks so far this year $1 4 billion.

Speaker Change: We have another 200 million dividend payment due in the fourth quarter. The total yield so far this year.

Speaker Change: Almost 8% of our current market capitalization.

Speaker Change: Returning significant capital to shareholders at the bottom of the cycle, while continuing to invest in growth is clear evidence of the progress Arcelor Mittal has made.

Speaker Change: To conclude my opening remarks.

Speaker Change: We are delivering resilient results and our performance continues to provide evidence that answer when we can deliver value to all aspects of the steel cycle.

Speaker Change: Our results free cash generation and a strong balance sheet provides a strong platform fall with strategic growth projects.

Speaker Change: The projects delivered so far.

Speaker Change: Achieving the results, we anticipated and there is a lot more to come.

Speaker Change: The projects, we will be commissioning over the next two to three years, we will provide significant structural upside to our EBITDA and cash flows on top of any cyclical recovery.

Speaker Change: And all the benefits to our shareholders are being compounded by our continued share buyback.

Speaker Change: So with that.

Speaker Change: We are now ready to take your questions Daniel.

Speaker Change: Great. Thank you Tim.

Speaker Change: Have a queue of questions already but just to remind everybody.

Speaker Change: If you would like to ask a question. Please do press star one on your key pads to join the queue.

Speaker Change: So we will move to the first question. Please.

Speaker Change: And the first question, we will take is from F. From Citi. Please go ahead.

Speaker Change: Thank you.

Speaker Change: So three short questions firstly.

Speaker Change: On <unk>, obviously, you've had this deal with Nippon.

Speaker Change: How long would that.

Speaker Change: The valid for I E could take a long time for the deal to get approved.

Speaker Change: And associated with that.

Speaker Change: Yes, Frank caliber does that effectively on hold.

Speaker Change: Good.

Speaker Change: The whole transaction completes or is that a possibility that you can start it.

Speaker Change: Scott construction even.

Speaker Change: Deal is not completed.

Speaker Change: Secondly on.

Speaker Change #105: One one level it'd be I mean, obviously you have put that project on hold as well, but the overall EBITDA of $1 8 billion from investments has <unk>. So can you just give us a sense just to hold the EBITDA contribution from that was supposed to be.

Speaker Change #105: We can get a sense as to how big or small.

Speaker Change: That to us.

Speaker Change: Sure let.

Speaker Change #106: Let me start with the last part of your question.

Speaker Change: I think Thats a good example of the discipline that we.

Speaker Change: We want to make sure that the employing all of our Capex projects. As you know this is a project.

Speaker Change: We started years ago with project and restart of the engineering and as we complete the engineering work, we realized investments would need to be higher.

Speaker Change: And therefore, we felt that it was prudent to put it on hold we do have auctions in Brazil.

Speaker Change: To continue to develop the business.

Speaker Change: Less capex.

Speaker Change: Yes.

Speaker Change: As you know one of our project.

Speaker Change: Initial maybe.

Speaker Change: Benefits as expected with the project from a $200 million.

Speaker Change: And Youre right you don't see a change in the overall 1 billion.

Speaker Change: And a lot of times, it's because.

Speaker Change: We are going to be.

Speaker Change: Announcing so often.

Speaker Change: New investments.

Speaker Change: That will basically offset all of it. So that's why we are keeping the overall target the same and then as it is.

Speaker Change: Released Q4 results, we will talk more about the new the new investments.

Speaker Change: Regarding Calvert. So the focus right now is really on completing the first year right. So everybody that that facility is very much focused on that of course, we have the discussion the deal with Nippon steel that is dependent on them closing that transaction, but our considered to everybody's focus on the cloud.

Speaker Change: Continuing to service our clients so nothing changed.

Speaker Change: So as you know as we sponsored the first year a lot has already been done.

Speaker Change: I think the second yes, but at this point in time.

Speaker Change #107: We have not yet.

Speaker Change: Taken the decision to move ahead with the second half although of course, it's always something content.

Speaker Change #107: Hi, Thanks, if I can squeeze just one more question.

Speaker Change #101: Clean can you tell us what you have what you're producing right now.

Speaker Change: And if that is.

Speaker Change: A ceasefire.

Speaker Change: <unk> in Ukraine.

Speaker Change: Much upside from volume can you kind of bring on within a short period of time.

Speaker Change #112: Yes, so the situation in Ukraine remains.

Speaker Change: That is similar to what we discussed in our previous call.

Speaker Change: So we are producing right now.

Speaker Change: We added about 40% of the capacity.

Speaker Change: So we are producing a range of 500 K per quarter.

Speaker Change: So clearly we want to see on the stabilization of the situation that I won't be what we should be in a position to ramp up production.

Speaker Change: Initially I would think at least two or 3 million tons, and then we would need to see them after that.

Speaker Change: How how to bring all the finances back up again.

Speaker Change #103: Thank you.

Speaker Change #112: Great. Thanks Efrain several.

Speaker Change #112: Now move to the next question.

Speaker Change: We will take from.

Speaker Change: At Morgan Stanley. Please go ahead.

Speaker Change: Yes. Thank you thanks, Danielle for taking my questions two questions from my side as well. So first question is on the buyback you still have less than $300 million to complete your current program, which is likely to conclude much earlier than the may deadline.

Speaker Change: Appreciate that we still have some time to cross that bridge, but how are you thinking about the next program at yearend is it fair to expect a similar buyback program to be launched in 2025. That's my first question.

Speaker Change: Yeah, well so far.

Speaker Change #100: First of all I think we are very pleased right with our capital allocation policy, it's working very well.

Speaker Change: I think we are really taking advantage of the of the week.

Speaker Change: <unk> share price.

Speaker Change: We bought back 37% of the company to see a 6% as it was.

Speaker Change: During my opening remarks, and looking forward I mean of course, the focus is completing the remaining program.

Speaker Change: You have 12 million shares to buy.

Speaker Change: And I guess the message is that our policy will not change so and when I look forward.

Speaker Change: I'm very optimistic about the capacity of the group to continue to generate free cash flow, especially when we look at the projects that we talked about the fact that the commission back on that when you start with a renewable project in India that we can.

Speaker Change: To have <unk> starting up soon.

Speaker Change: So we will have another $500 million of EBITDA coming through next year and another 502006 that provided a lot of comfort that the group should be in a position to continue to generate strong free cash flow.

Speaker Change: And our policy as you know, 50% will be returned back to shareholders is minimal.

Speaker Change: <unk>.

Speaker Change: So we are going to be closing the year with net debt levels are well under control. So I think that plays very well to continue to.

Speaker Change: Do any buybacks.

Speaker Change: We have the authorization from our shareholders.

Speaker Change: But let's first complete the existing program and then.

Speaker Change: Discuss the second or the next the next program.

Speaker Change #121: Thank you very much anyway on the second question is on <unk>.

Speaker Change #118: That has been very immaterial so far.

Speaker Change #119: Year to date, and I would say two or three years to date. Many investors are worried that we will hit the wall of spending into the end of the decade and so firstly do you still stand by your 10 billion targets through 2017, and then secondly, when are we likely to hear more about the specifics of your D card flat. Thank you.

Speaker Change: Yeah.

Speaker Change #102: Well the way I see it I think we have been doing quite a lot and.

Speaker Change: Where we are today I mean, we continue of course, we both engineering work. So we continue to.

Speaker Change: Develop that as we said in the previous quarter, we should be in a position to provide some more color.

Speaker Change: Towards the end of the year.

Speaker Change: So that remains.

Speaker Change: But I think we have.

Speaker Change: <unk> been doing quite a lot.

Speaker Change: So we have.

Speaker Change: And beyond that we are building.

Speaker Change: We have now a portfolio or two giga of renewable projects, we talked about <unk>, we have another one giga in Brazil and Argentina.

Speaker Change: We are investing in <unk> in Spain. So we are going to be doubling the capacity currently current capacity of that facility, which is also green steel.

Speaker Change: So I think we are doing a lot and then of course, we are which is extremely important here just to make sure that we have the right policies in place. So that we can justify the large investments in Europe, and we have been talking about that I think we have been very clear that we.

Speaker Change: We need a number of things in place we need a strong seaborne we need strong protection to the industry. So that was swinging bass. These assets will be in a position to compete.

Speaker Change #124: A level playing field.

Speaker Change #125: Thank you gentlemen, so basically a follow up to this question is do you stand by your $10 billion by 2030, given we know what we know today.

Speaker Change: Yes, I think we are not changing that.

Speaker Change: That number remains our best guess.

Speaker Change: Thank you. Thank you very much.

Speaker Change #127: And yes just to.

Speaker Change: Mind, everybody obviously.

Speaker Change: Gross number.

Speaker Change: Pre government funding.

Speaker Change: So on a.

Speaker Change: Also mutual basis, it would be about $5 billion.

Speaker Change: But we.

Speaker Change #115: We will move now to the next question.

Speaker Change: Which we will take from Tom.

Speaker Change #125: Tom Zhang at Barclays. Please go ahead Tom.

Tom Zhang: Hi afternoon. Thanks for taking my questions two from me I'll take them one by one first.

Tom Zhang: First maybe just to usual.

Tom Zhang: Did you guys give quarterly raw material costs price and volumes by division if that's okay into Q4.

Tom Zhang: <unk>.

Tom Zhang: Yeah.

Tom Zhang: Hi, Joe.

Tom Zhang: Yes sure Jeremy.

Jeremy No: And so I think looking to the fourth quarter, we can go into more detail, if you'd like but 10.

Jeremy No: At the fourth quarter, there were clearly some pluses and there is some minuses, but I think the April picture is broadly similar to the third quarter.

Tom Zhang: On the positive side of the equation and we should see the benefit of higher volumes in Europe.

Tom Zhang: Higher iron ore shipments.

Tom Zhang: Other sides of the equation and we will have the impact of lower spot prices.

Tom Zhang: <unk> North America, and then seasonally lower shipment volumes and Brazil, So as I say, some pluses and minuses at the overall picture broadly similar to the third quarter.

Speaker Change #111: Got it. Thank you and then just the second one was.

Speaker Change #111: Yes.

Speaker Change #111: It's a bit early to start talking about it but.

Tom Zhang: Obviously at the moment until the <unk> is up and running you guys have upstream do you already have.

Tom Zhang: Corpus Christi assets Cri, but east.

Tom Zhang: 40%, 50% of the U S MCA say.

Tom Zhang: Sales number for you is still in the U S.

Tom Zhang: <unk>, I guess from Mexico and Canada.

Speaker Change: One is that number roughly right sort of 40%, 50% and then can you just talk about any backup auctions that you guys have already been thinking about it.

Tom Zhang: Under the new administration materials starts to become more difficult said that particularly for Mexico.

Tom Zhang: Yes.

Tom Zhang: Hi.

Tom Zhang: I said I think it's early days right.

Tom Zhang: And what we what we saw in the first step of President Trump he wasn't extremely supportive to the industry.

Tom Zhang: It was also I think a lot of what we see happening and you asked whether it comes from the fact that he put in place section 230 true.

Tom Zhang: Renegotiated NAFTA agreement of course, now U S MCA.

Tom Zhang: Part of his legacy.

Tom Zhang: It was all very supportive to the industry in U S.

Tom Zhang: North America overall.

Tom Zhang: We saw the consequences of that.

Tom Zhang: In other parts of the.

Tom Zhang: Award as well.

Tom Zhang: So we hope that.

Tom Zhang: As he comes back now in the second time.

Tom Zhang: We will probably most likely see.

Tom Zhang: So thats that supports continuing.

Tom Zhang: And it will be very interesting to see also how the other regions. The other governments respond to respond to that.

Tom Zhang: So I think it's early days to talk about the <unk>.

Tom Zhang: Close between Mexico, Canada, and U S and vice versa. The way, we see it today to close.

Tom Zhang: Barry.

Tom Zhang: On a similar basis when you look at Canada.

Tom Zhang: Mexico and the U S.

Tom Zhang: But I think what we'll have to wait and see how how how it develops.

Speaker Change #117: Okay fair enough. Thanks, I'll turn it back.

Paul: Great. Thanks, Paul.

Speaker Change #122: We will move to the next question now.

Speaker Change #122: Now, which we will take from Patrick.

Paul: Bank of America.

Patrick: Go ahead.

Paul: Hey, good afternoon, thanks, very much for the opportunity.

Speaker Change #133: Can you, maybe just touch a little bit on how we should think about the automotive business going into next year. So.

Paul: Spot prices are a little bit lower so how should we think about that aspect of in particular Europe.

Paul: Sort of pricing into next year.

Paul: And I suppose given the backdrop that it looks a lot of auto suppliers are under a lot of pressure and we are seeing a lot of restructuring.

Tom Zhang: A lot of it look structural rather than cyclical.

Speaker Change #134: So maybe just a bit of context, how important is that business to Europe.

Tom Zhang: Overall, and how should we think about it into 2025. Thank you.

Speaker Change #122: Yeah. So.

Speaker Change #101: That's great.

Speaker Change #101: Patrick.

Speaker Change #110: The benefit of our diversification so when when we look at our auto business in 2020 for what we see.

Speaker Change #110: We all know.

Speaker Change #110: We have gone through some destocking in Europe, So our production in Europe will be lower compared to the previous year.

Speaker Change #101: But at the same time, we are seeing growth in Brazil, and Argentina, we are in.

Speaker Change #101: We have seen more stability in North America.

Speaker Change #101: So when we look at our business as a whole there are pluses and minuses right.

Speaker Change #101: Looking forward.

Speaker Change #101: Our base case today is that we're going to see some stability in terms of volumes compared to this year.

Speaker Change #101: And when it comes to prices of course, it's too early we have not yet really started all of these negotiations, but our focus is the same varieties to make sure as you know we invest heavily in making sure that we develop the grades.

Speaker Change #101: That we have the technology that helps.

Speaker Change #101: Helps support the Oems with payroll objectives, and our focus is make sure that we are rewarded for that so our focus is more on the margin that we can see Q.

Speaker Change #101: As we find is this contract. So we remain of course optimistic that theres not going to change that we will be able to sign contracts that will reward the company for.

Speaker Change #101: The investments.

Speaker Change #101: We make.

Speaker Change #133: Got it. Thank you and then if I could I have a follow up just on sustainable solutions can you give us.

Speaker Change #101: An update on that business.

Speaker Change #101: Obviously revenue is down year on year, and it's a it's an area that you were looking to grow so just thinking about how do you think about that going forward. Some steel would be helpful. Thank you.

Speaker Change #137: Sure Yeah, I think you'll see a decline in quarter, three which to some extent is also linked to seasonality when you expect to be doing better in Q4.

Speaker Change #101: Importantly.

Speaker Change #101: We have the one giga renewable projects that we talked about so that's the labs.

Speaker Change #101: Close to $100 million next year to sustainable solutions, So we talked about.

Speaker Change #101: And you can see in our deck. Some other renewable projects that we started in Brazil. So that will continue to support we.

Speaker Change #101: We have completed the acquisition of.

Speaker Change #101: In our construction business in.

Speaker Change #101: In Europe. So that will also provide support next year. So I think we are on track to double the profitability of this segment over the next couple of years.

Speaker Change #107: Thank you.

Speaker Change #107: Yeah.

Speaker Change #107: Okay.

Speaker Change #107: Yes.

Speaker Change #107: Hi, Jamie I'm, sorry about that my my assistant just crushed.

Speaker Change #107: But.

Speaker Change #113: No problem.

Speaker Change #113: So I think we're ready to take the next question which is.

Speaker Change #116: Andrew I'd say UBS Hi, Andrew go ahead.

Speaker Change #116: Yeah.

Speaker Change #116: Thanks Danielle.

Speaker Change #143: Yes, just to push a bit more on one of the previous questions around <unk> and just how you think about.

Speaker Change #116: When you basically press the trigger.

Speaker Change #116: You mentioned you'd like to see.

Speaker Change #116: Our strong and obviously, we've got a structure in place for the seed them I'm wondering what.

Speaker Change #144: You want to see from it.

Speaker Change #116: The structure of that too.

Speaker Change #116: Cause you to invest in.

Speaker Change #141: What are the factors are you looking for in particular.

Speaker Change #116: Do we need to see more on the infrastructure side, whether it comes to hydrogen what's become what level, we're talking about.

Speaker Change #120: Sufficient renewable energy.

Speaker Change #128: Well. The fact is all you're looking for before you actually pull the trigger is now here.

Speaker Change #128: Yeah.

Speaker Change #120: If you don't see that sufficient return on capital and you don't see that support.

Speaker Change #120: Those projects and the higher cost jurisdictions in terms of energy such as Gen <unk>.

Speaker Change #129: Belgium Israel.

Speaker Change #129: Yes.

Speaker Change #129: So now where you just do not spend that money and you actually.

Speaker Change #129: We've owned these assets for cash.

Speaker Change #120: Yes.

Speaker Change #120: Those investments I mean it is.

Speaker Change #120: That would be elastic snowy.

Speaker Change #120: Yeah.

Speaker Change #120: Andrew.

Speaker Change #149: You touched on all the points right. So I think it's been as I said I mean, I think it's very important that as we embark on some of these projects that we.

Speaker Change #149: That we can be sure that we're gonna be remained competitive right in that.

Speaker Change #120: The assets will be able to do we want to be able to run the assets and be competitive and put out today as we know it.

Speaker Change #120: The competition in Europe is not bad.

Speaker Change #120: We are being pursued to causes that nobody else in Spain.

Speaker Change #130: Do you have the high energy cost as we don't have the availability of renewable power sufficient or hydro insurance. So I think you touched on all the points that I think it's also cleared through all the governments there.

Speaker Change #147: That is really what is required for the industry to be able to shrink and Beth first of all I think we need to have strong protection in Europe.

Beth: Because we have China, we just saw the numbers right towards the numbers from China, Florida.

Speaker Change #120: Exports.

Speaker Change #120: I think that needs to be taken very seriously and quickly by.

Speaker Change #120: By the authorities in Europe.

Speaker Change #120: And across the web.

Speaker Change #120: Quite quite frankly.

Speaker Change #120: So until we see we can see that it's very hard really to take a decision too.

Speaker Change #120: Turning fast.

Speaker Change #120: Hope for that.

Speaker Change #120: We'll see progress.

Speaker Change #133: We havent because we view of see bump coming up soon and we will see finally, what the government takes into account. So there any sense you can see.

Speaker Change #133: <unk> is also very active in ensuring the needs and what needs to happen. So that we can have again.

Speaker Change #120: A level playing field in Europe again, I think the competition today is just not buckhead.

Speaker Change #154: Okay, that's clear and just.

Speaker Change #120: Second question on.

Speaker Change #142: Obviously, it's no longer your asset we've seen news about restarting blast furnaces that are talking about ordering DIY equipment. It seems.

Speaker Change #142: Things are moving and that's going to be more volume in the market.

Speaker Change #142: All of that.

Speaker Change #142: In the near term and into next year.

Speaker Change #152: Steve along with that that they build that DIY capacity are you.

Speaker Change #130: Hence you concerned about that supply growth coming at us out of obviously weak demand.

Speaker Change #130: Yeah.

Speaker Change #130: To be honest, Andrew our number one concern right now its imports.

Speaker Change #130: As I said I think the level of imports.

Speaker Change #130: In Europe are just too high.

Speaker Change #120: And that should be the intermediate the first priority is to get that under control and that's really.

Speaker Change #120: What are the most critical piece for us.

Speaker Change #120: Okay.

Speaker Change #120: Okay.

Speaker Change #120: Thanks.

Speaker Change #131: Thanks, Amie, so I'll move now to the next question.

Speaker Change #138: And we'll take that question from Dominic.

Speaker Change #120: J P Morgan.

Speaker Change #154: Go ahead.

Speaker Change #156: Hi, guys. Thanks for taking my question just some simple questions just on working capital for Q4 is it reasonable to assume that we see a full unwind of the $1 5 billion.

Speaker Change #156: Built so far.

Speaker Change #120: In the first nine months of the year.

Speaker Change #144: Second question similar question on on the previous question around Capex, but if I, if I look away from peak Hep Capex, specifically look at the regions Europe.

Speaker Change #144: First nine months still about 50% of your Capex as you look into 2024 are you seeing opportunities to maybe bring down some of the European capex or is that not on the agenda.

Speaker Change #147: Yes, that's my three questions. Thank you.

Speaker Change #157: Yeah, so on the working capital you're right.

Speaker Change #149: That's all the guidance that we should re needs are.

Speaker Change #147: A similar number as we have invested up to now.

Speaker Change #120: And doing.

Speaker Change #120: Doing this very carefully because as we have pointed.

Speaker Change #120: Pointed out in our release at some point, we're going to see a cyclical recovery right.

Speaker Change #120: So we want to make sure that the business.

Speaker Change #120: Well funded and they have the working capital needs as and when we see this.

Speaker Change #120: Cyclical rebound.

Speaker Change #120:

Speaker Change #120: One on Capex.

Speaker Change #120: I think it's that important to your point because when you look at the beta that generate in Europe, you see the Capex that you can see that our segment.

Speaker Change #120: Well.

Speaker Change #120: So we are generating levels, good levels or different levels of free cash flow in Europe.

Speaker Change #120: But you should also we can.

Speaker Change #120: Talk about that in more detail, but you also have growth capex.

Speaker Change #138: Alright, and Thats basically our new electrical steels project and Marty you are investing so we're going to be completing the first phase of the project towards the end of this year and then that is the second phase.

Speaker Change #138: That will happen in 2020.

Speaker Change #138: Hi.

Speaker Change #120: But overall, if I can talk about Capex for next year and as you can see now that you have basically three components.

Speaker Change #120: I always Spectation is we will of course being in a position to update you more as we complete the budget and strategy strategy cycles.

Speaker Change #120: And in our Q4 numbers, we will be in a position to update you with more precision, but our expectation at this point in time is that the Capex number for next year will not change significantly.

Becky: Thank you Becky.

Speaker Change #144: Great. Thanks, Dominic So we'll move to our next question and we'll take that from Paris at Kepler Cheuvreux. Please.

Speaker Change #167: Please go ahead.

Speaker Change #157: Hello, Thank you for taking my question.

Speaker Change #157: The first one is on Europe.

Speaker Change #144: <unk> bye.

Speaker Change #144: The margin resilience.

Speaker Change #120: Well, we see or the <unk>.

Speaker Change #120: We've seen a lot of buildings.

Speaker Change #120: Suppose you already answered part of it.

Speaker Change #120: In this context, we see it more and more M&A.

Speaker Change #120: We don't know shapes.

Speaker Change #120: <unk> made an announcement about one of its main shareholders.

Speaker Change #120: Planning to make a takeover bid every citizen crude.

Speaker Change #120: Trying to form partnerships with <unk>.

Speaker Change #168: So I was wondering if you had some.

Speaker Change #120: Some Toyota opportunity therefore for some of your assets.

Speaker Change #120: You started to see some opportunities.

Speaker Change #120: <unk>.

Speaker Change #120: Also on the.

Speaker Change #120: A second question on the M&A front.

Speaker Change #120: News flow about.

Speaker Change #169: So I'm interested in your South African asset so could you elaborate if you can comment on those.

Speaker Change #151: Thank you.

Speaker Change #120: Yeah.

Speaker Change #120: So first.

Speaker Change #120: On Europe I think we are pleased with our performance in Europe and the teams are doing a great job.

Speaker Change #161: Operational reliability.

Speaker Change #120: You can see that we are running our financed as well so that of course supports our costs, we can bring costs down.

Speaker Change #120: So we can achieve.

Speaker Change #120: Gangs I think teams are doing a very good job in this very challenging market conditions.

Speaker Change #120: That's in terms of M&A I think we are.

Speaker Change #120: We are now.

Speaker Change #120: We're happy with our footprint.

Speaker Change #120: So that's our that's.

Speaker Change #120: That's the bottom line.

Speaker Change #120: In South Africa.

Speaker Change #120: We are not contemplating any any any any change there.

Speaker Change #120: Yeah.

Speaker Change #163: Okay. Thank you.

Speaker Change #163: Great. Thanks, Chris.

Speaker Change #152: So we'll take the next question not so we'll move to BNP Paribas.

Speaker Change #165: Please go ahead Kristen.

Kristen: Yes, hi, Thank you for taking my questions.

Kristen: First one is on North America could you remind us the volumes and the type of products you ship to the U S.

Speaker Change #120: From Mexico from Canada from Canada from Europe, and Brazil, Please and also with Trump.

Speaker Change #120: Getting back Terrace against Mexico, what are your options to mitigate that risk how flexible can you be more specific regarding the U S trade case against Canada Hot dip galvanizing ports how.

Speaker Change #173: How confident are you that Canada will not face carriers tier I start there.

Speaker Change #173: No look I mean, we have to wait.

Speaker Change #120: Of course part of the outcome of the investigation Ryan. So of course, we will call Greg will be able to be part of the process.

Speaker Change #120: So.

Speaker Change #120: <unk>, what we felt from Canada into the U S. These are.

Speaker Change #120: Contract that I am thankful for amendment, yes.

Speaker Change #120: Made through the Oems.

Speaker Change #120: We don't believe that clothing and jewelry.

Speaker Change #120: Of course, we will participate in and we will have to wait to see.

Speaker Change #120: How it plays out and then.

Speaker Change #120: You know I think you know very well close so we bring slabs to call back from Mexico, and Brazil, We bought it so I'm also domestically.

Speaker Change #120: And we won't have a cost.

Speaker Change #120: Now coming up so that will be.

Speaker Change #120: An extremely positive for operations in U S. So we will have melted and.

Speaker Change #120: In steel and you add $1 5 million tonnes will give us.

Speaker Change #120: We won't have capabilities to do expose box will have everything that is required for that so that should provide a good boost to our operations.

Speaker Change #120: Operations in U S.

Speaker Change #120: But our call but of course, we still need to buy less.

Speaker Change #120: So at this point in time I think it's too early to talk about.

Speaker Change #120: Uh huh.

Speaker Change #120: Uh huh.

Speaker Change #170: We have options right. So we have Mexico. This is part of the North America.

Speaker Change #170: Talking with MCA.

Speaker Change #120: And we have all the auctions as well we can bring our materials from Europe to have true, but at this point in time I think that's too early.

Speaker Change #178: Speculate on that.

Speaker Change #170: Okay and could you share the slab supply that you're getting for our Calvert at the moment, how much volume's coming from Mexico and Brazil.

Speaker Change #181: I don't think it's something that we are disclosing.

Speaker Change #120: <unk>.

Speaker Change #183: Okay, Okay alright.

Speaker Change #120: Second question is on Europe, and again on <unk>.

Speaker Change #120: So when you talk about positive free cash flow past 2024 should.

Speaker Change #187: Should we think it has a firm target that you absolutely want to achieve or is more kind of an aspiration you took about the level playing field, but let's say would you be okay. If down the line. There is a level playing field that require investment that require you to be negative free cash flow for a couple of years, that's something that you could contemplate or.

Speaker Change #187: You really want to be in that positive free cash flow set up for the medium term.

Speaker Change #187: That has to be objective.

Speaker Change #120: And of course, we want our business to be to be.

Speaker Change #120: The sustainable I think that ski Brian.

Brian: Sustainability is really the key one if we feel that we have a sustainable business with strong business, we are prepared to invest in.

Brian: And that's why we have always always done so.

Speaker Change #120: So it's an important market.

Speaker Change #120: It's a big market and I'm not going to disappear right. So I think.

Speaker Change #120: So we have to get through.

Speaker Change #120: As long as we have the right conditions.

Speaker Change #185: Thank you and maybe just a quick last one Mexico, you mentioned that the EIA study that was there a blast furnace outage as well GT described has it restarted already.

Speaker Change #157: Yeah. So.

Speaker Change #157: And massacres annoying the biggest part of the business as a direct business, which has started.

Speaker Change #157: Immediately almost immediately after the end of the blockade was mid July so that is up and running.

Speaker Change #157: The blast funding, which is a smaller part of the business has not yet started it should be started anytime soon.

Speaker Change #157: The blast furnace, it's a it's a million.

Speaker Change #157: <unk>.

Speaker Change #157: It's a small finance.

Speaker Change #157: And secondly, we have to.

Speaker Change #157: Go through some maintenance work.

Speaker Change #157: And that's why it's taking a bit longer but we should be in a position to start that.

Speaker Change #157: The next day.

Speaker Change #175: Perfect. Thank you very much.

Speaker Change #157: Great. Thanks Kristen.

Speaker Change #157: <unk> got.

Speaker Change #157: Two more questions Jeremy first we will take from.

Speaker Change #192: Got it got among sex. Please go ahead Max can Harris.

Speaker Change #179: Thanks, Dan and good afternoon.

Speaker Change #160: Well first of all just on Brazil.

Speaker Change #196: Positive PC that you've seen this quarter I guess some of thats the tariffs flowing through but just interested on that.

Speaker Change #160: <unk> also ramping up the <unk> CMC.

Speaker Change #160: I guess into year end and just trying to think about 2025.

Speaker Change #194: You stated that this project should bring a $100 million EBITDA, but I think thats on a more normalized basis. So as we stand today is there upside or downside to that number and can you just provide some color as to the timing as to when we could see that full ramp up delivered.

Speaker Change #194: Yeah.

Speaker Change #183: There hasn't been and it's probably a good number for next year. We are very pleased with the ramp up of the facility.

Speaker Change #197: Uh huh.

Speaker Change #160: It's being done.

Speaker Change #160: Record basis, I would say.

Speaker Change #160: We should be closing the year already probably around 80%.

Speaker Change #162: So I think the 100 million it's Oh.

Speaker Change #162: It's a good number for you to take them through your models for next year in Brazil. We are pleased of course with the overall performance in Brazil in Q2.

Speaker Change #162: <unk> was really great.

Speaker Change #162: Economically the country is doing well GDP is strong this year.

Speaker Change #162: We have low unemployment rate.

Speaker Change #162:

Speaker Change #162: Got it.

Speaker Change #162: Good setup right now so apparent steel consumption will grow well this year.

Speaker Change #162: So it's it's a it's a good setup at the moment.

Speaker Change #200: Okay. That's great. Thank you and then Tim.

Speaker Change #182: Maybe let's library itself it looks like Youre delivering first concentrate this.

Speaker Change #191: I guess this quarter say.

Speaker Change #186: How is the commissioning of the concentrated Glenn can you just provides country has to has it performed in line with expectations in terms of product quality.

Speaker Change #182: And do you still standby I guess the ramp up of that expansion into next year.

Speaker Change #203: Yes. So the focus is of course on the project that everybody is focused on that and I haven't even plus concentrate.

Speaker Change #182: End of this year.

Speaker Change #182: So as you can imagine it's a large project.

Speaker Change #182: A lot of challenges, but we are progressing we feel optimistic.

Speaker Change #162: Let's see how it how it goes.

Speaker Change #162: But that's an important project for us. So as you know we have three models. So let me start with 5 million tons and then we'll have a second one and third one and 2025.

Speaker Change #162: So we remain optimistic that we're gonna be in a position to start to see significant contribution from Liberia.

Speaker Change #162: Next next year.

Ed: That's great. Okay. Thank you Ed.

Speaker Change #192: Squeeze one last hypothetical question with good with Calvert and.

Speaker Change #179: I guess, just having full ownership and I guess importantly, operator ship ignoring tariffs in order to maybe thoughts out there at the moment, but having this asset and in control of this asset does this unlock any synergies that.

Speaker Change #179: Across the broader North America.

Speaker Change #179: Sort of Mattel portfolio.

Speaker Change #162: You can maybe touch on.

Speaker Change #162: As we know covered is the most capable of finishing facility in North America right.

Speaker Change #162:

Speaker Change #162: And.

Speaker Change #162: It makes of course.

Speaker Change #162: Good SaaS for us to own 100% of the answer to the extent that Nippon has to have to divest.

Speaker Change #162: But having said that this is not really about synergy.

Speaker Change #162: It's just about.

Speaker Change #162: Owning 100% of disaster in a region that is very important for us from a metal.

Speaker Change #162: And we've talked about in the past projects that we are developing right now for the region.

Speaker Change #162: So.

Speaker Change #162: So to the extent that.

Speaker Change #162: And if one can complete the AWN transaction, we will be pleased to own 100% of carbon.

Speaker Change #204: That's great.

Speaker Change #204: That's all for me thank you.

Speaker Change #162: Alright, Thanks, Bob.

Speaker Change #173: We'll take our last question now Jeremy and I will take it from Max.

Speaker Change #173: So please go ahead Max.

Max Harris: Good afternoon.

Max Harris: First question is on kind of a precisely can you talk us through the financial implications of the deal because Nippon still highlighted.

Speaker Change #208: <unk>, one 5 billion negative impact on the balance sheet should we expect the same kind of.

Max Harris: Impact on your own balance sheet positives. This time and can we just add the current EBITDA contribution as reflected in the in the.

Speaker Change #162: The disclosure you gave to your own EBITDA.

Speaker Change #162: Some kind of.

Speaker Change #162: Elimination, we should do to take into account.

Speaker Change #162: This is a step shipments from Brazil and from Mexico.

Max Harris: Yes Max.

Speaker Change #198: What I suggest we do with that is there.

Speaker Change #177: It is.

Speaker Change #177: Let us wait to see.

Speaker Change #177: What does the transaction closed and then we're going to be in a position to.

Speaker Change #177: Walk you through would be.

Speaker Change #177: Accounting implications clearly we don't we don't have any in 5000 impairments fine.

Speaker Change #177: But let's wait until the transaction closes and then we can.

Speaker Change #199: Walk you through.

Speaker Change #199: The accounting implications of the transaction.

Speaker Change #209: Okay. That's fair and so my question is on value. Rick I think you were between 10, so far to give more color on the synergies is noncash and that closed this acquisition, which was the case at the last results presentation in July but now that you have.

Speaker Change #209: Close the deal.

Speaker Change #177: Can you talk us through the same the same way off.

Speaker Change #177: <unk>, you expect to achieve on them and direct them.

Speaker Change #177: I mean as you know the company now for a few months.

Speaker Change #177: Have you progressed in that direction.

Speaker Change #177: Well.

Speaker Change #177:

Speaker Change #177: Well, what I would say is that we have.

Speaker Change #177: We are pleased with the acquisition mix, we are what we see today. It's in line with all the expectations. So the company continues to perform well.

Speaker Change #177: So no no no no bad news so that's good news.

Speaker Change #177: And as we discussed I mean, this is not a transaction that was done.

Speaker Change #177: Based on <unk>, because we are a minority shareholder we have of course, an important stake but.

Speaker Change #177: We have a minority.

Speaker Change #177: So we don't have control.

Speaker Change #177: So all we're doing is of course, we are welcome to work together, we have areas, where we have where they are present, we are present and to the extent that we can work together we will.

Speaker Change #177: To the extent that it's a win win that it could fall below that shareholders could force kilometre shareholders. We're gonna be open to explore but at this point in time.

Speaker Change #177: I don't have anything to report to you on that front.

Speaker Change #213: Okay, That's fair and the last one is on Ukraine.

Speaker Change #177: Speaking of the truth, but there's also the possibility for a share progressing further.

Speaker Change #177: Notably the city of <unk>.

Speaker Change #215: Brett from Russia, and its the main call center in the region.

Speaker Change #177: Sophie Nielsen from some code from just from this mine and would you be able to offset those.

Speaker Change #204: And so shipments resume with another.

Speaker Change #177: <unk>.

Speaker Change #177: And perhaps we could do that job just idled one person is there.

Speaker Change #177: Just to be opened itself can you explain why you did.

Speaker Change #177: Kind of step back.

Speaker Change #177: Sure.

Speaker Change #177: Yeah, well as we know the situation in Ukraine.

Speaker Change #206: It's volatile.

Speaker Change #206: It's changing every day, so I think the teams are doing.

Speaker Change #177: They can.

Speaker Change #177: What we experienced more recently is that the price of <unk>.

Speaker Change #177: And then she has been very high.

Speaker Change #177: And therefore, we are just optimizing the flows the production so to say on energy costs. So that's why you're going to see this volatility in terms of production.

Speaker Change #177: As long as the situation.

Speaker Change #177: Less.

Speaker Change #177: So we do have the possibility to bring raw materials from different sources that happens with the fan out.

Speaker Change #177: Just described.

Speaker Change #177: So we have the connections Poland, we have the.

Speaker Change #177: Or does this whole pandemic.

Speaker Change #177: So we do have possibilities.

Speaker Change #177: If we lose connection with that part of the country.

Speaker Change #201: Okay. That's clear so thank you.

Speaker Change #209: Thanks Pat.

Speaker Change #194: Two we've got time for one follow up question I Hope, Jim We know so we will take that from Bastian at Deutsche Bank.

Speaker Change #211: Hi, Bastian. Please go ahead with your follow up.

Speaker Change #212: Yes, good afternoon, all and thanks for taking my question I wanted to ask a quick one which is a follow up on Ukraine. So can you maybe just remind us what is the capacity you have available there at the moment and if you would go from where you're currently running full capacity is there any major investments needed at this point.

Speaker Change #194: And then related to that maybe could you put this into the context of the wider I guess Ukrainian context in terms of.

Speaker Change #194: What's the capacity been has their people the way you perceive it and basically how much capacity is available there in the broader market versus what unfortunately, obviously has been taken out that was all my questions.

Speaker Change #194: Yeah.

Barton: Well Barton.

Speaker Change #194: So we are running.

Speaker Change #194: <unk> is at the moment, we are running one finance so youre running at about as I said at about 40% so and so.

Speaker Change #194: Story, clearly before the wall we want.

Speaker Change #194: North of 4 million tons or $4 5 million tonnes.

Speaker Change #194: So we do have the possibility to increase capacity from 40 to maybe 70% and then beyond that point that would require some investment right. So.

Speaker Change #194: So clearly we have the potential we have to ramp up if we if we see the conditions, if we see markets.

Speaker Change #194: It makes economic sense.

Speaker Change #194:

Speaker Change #194: But that's that's that's the situation right now.

Speaker Change #194: Okay. Thank you.

Speaker Change #206: I guess people think Ukraine has been pretty much like a 'twenty 'twenty 2 million tonne production country up I mean, how do you see the feasibility of the whole market now given the current situation.

Speaker Change #216: It was before.

Speaker Change #217: It's all yes, very <unk> in Boston.

Speaker Change #206: So as we know them in a big part of the industry was destroyed right. So.

Speaker Change #194: And that has not changed.

Speaker Change #194: So.

Speaker Change #194: The market size.

Speaker Change #194: I have to say I mean, it's it's for Jive.

Speaker Change #194: Everybody is facing the same situation, we have high energy costs, which has been.

Speaker Change #194: Holding developments there. So I think we have to wait a bit to see how things stabilize in Ukraine, that's hopeful.

Speaker Change #194: For peace and that we can we start reviewing the country.

Speaker Change #219: Okay understood. Thank you.

Speaker Change #221: Thank you Bastian so that's our last question gentlemen.

Speaker Change #222: I hand back the call to you for any closing remarks.

Speaker Change #214: Thank you Daniel.

Speaker Change #219: Thank you everyone and before we close I want to reiterate my message from the beginning of the call. Firstly the whole Arcelor Mittal organization is galvanized to improve safety performance.

Speaker Change #194: Secondly, how resilient results in the face of challenging markets continued to demonstrate the structural improvements.

Speaker Change #194: Returning significant capital to shareholders at the bottom this cycle, while continuing to invest in growth is clear evidence of the progress Arcelormittal has made there.

Speaker Change #194: As much to anticipate.

Speaker Change #194: All projects had good momentum and we will provide unique upside to EBITDA and cash flows on top of any cyclical recovery.

Speaker Change #194: If you need anything further please do reach out to Daniel and his team and I look forward to speaking with you soon.

Speaker Change #194: And it goes around you as well thank you very much.