By Alex MacDonald
LONDON--Steel titan ArcelorMittal (MT) can't rule out further
temporary or permanent idling of blast furnaces as its seeks to
realign its production capacity to demand in Europe, the company's
chief financial officer said Wednesday.
The European Union sovereign debt crisis has taken its toll on
regional economic growth and steel demand. Europe's largest
steelmaker by capacity has responded by temporarily idling some
blast furnaces and permanently closing two furnaces in Belgium in
order to realign its production capacity to demand.
Chief Financial Officer Aditya Mittal told journalists on a call
Wednesday that although European demand is weaker than previously
expected, the company hasn't changed its asset optimization plan,
which aims to achieve $1 billion in annual earnings before
interest, taxes, depreciation and amortization, or ebitda, savings
by the end of 2012.
"We are not changing or enlarging our asset optimization
program...because of the situation in 2012," CFO Mittal said told
journalists. "The asset optimization program that we have embarked
on, the $1 billion savings....is the program that we are
maintaining, and we believe that it is sufficient on a medium-term
basis to adjust our supply to meet the demand level in Europe."
ArcelorMittal has idled nine out of its 25 blast furnaces in
Europe, according to Mr. Mittal. He noted that he doesn't expect EU
apparent demand to recover until the fourth quarter when restocking
is likely to lead to a technical recovery compared to the third
quarter.
-Write to Alex MacDonald at alex.macdonald@dowjones.com
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