Arcelormittal SA

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 in 2024. Present on the call today, we have our CEO, Aditya Mittal, and our 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 23 of that presentation. Following some opening remarks from Aditya and Jermino, we will move directly to the Q&A session. So if you would like to ask a question, then please do press star 1 1 on your keypad to join the queue. So that instruction is star 1 1 to join the Q&A queue. And with that, I will hand over the call to Aditya.

Thanks, Daniel. Welcome everyone and thank you for joining today's call. Before I ask Jenrino to comment on our financial performance, I want to spend a moment reviewing the progress we have made against our priorities. First, I want to talk about safety. Across the company, our people are galvanized to improve our safety performance and achieve our goal of being fatality and injury free. saw the completion of the DSS Plus group-wide safety audit and the recommendations which focus on our risk management processes and establishing a consistent safety-first culture across all group operations. I'm determined that we improve our safety performance this year and believe the detailed unit-specific roadmaps developed from the audit will support our efforts to do so. Reflecting on our strategic progress in 2024, we have achieved a great deal. We have faced challenges. As we all know, the cycle has not been in our favor. Yet despite those headwinds, we have delivered resilient results. Two billion of investable cash flow generation in this environment speaks to the progress we have made as a company. This has allowed us to invest counter cyclically and reward our shareholders at the same time. Everyone at Arsura Mittal should take pride in this. Growth is an increasingly important theme for Arsura Mittal. This year, we will start to see the benefits of the organic investments we have been making over the last few years. The expected structural EBITDA impact from our portfolio of high-return strategic projects now stand at 1.9 billion. 400 million of this is due to be captured in 2025 with a further $600 million due in 2026. Our recently completed projects, the Vega coal mill complex in Brazil, the new hot strip mill in Mexico, and the one gigawatt renewable project in India are performing well. The fact that these projects are delivering new incremental EBITDA we expected should instill confidence that our strategic CAPEX will add significant structural earnings and cash flow benefits. Similarly, the assets that we have acquired in recent periods, including PESM in Brazil, Texas HBI facility, and the stake in BALOREC are all performing well, adding further structural earnings and cash flow growth. This growth supports higher shareholder returns. Over the past four years, our dividend has grown at a compound rate of 16%, reflecting our confidence in the outlook of our company. On top of our dividends, we have returned significant cash through our buybacks, allowing us to reduce our share count by 37% over the last four years, a rate unmatched by any of our peers. Our policy and capital return intentions are clear. On the theme of DCAP, I want to highlight that Arsura Mittal's absolute carbon emissions today are approximately half the level of 2018. Much of this has been the result of our portfolio optimization and the steps that we have taken to shape our business around our most competitive assets. As we move forward, we're determined to follow a transition pathway that is economic and ensures that we remain competitive. When it makes sense, we are making investments. The EF in Gihon and the revamp of our two EFs in Sistao are both good examples. These economic projects support our growing offering of low-carbon solutions to our customers under our X-Carb brand. It is critical that we see Europe make swift progress in providing a policy environment that appropriately incentivizes the further investments required to accelerate decarbonization in Europe. As I conclude, my message is quite simple. We are a transformed business We have the best talent. We have excellent market positions in all the attractive geographies, including a unique exposure to India, and we have a reputation for quality and innovation that is unmatched by any of our peers. Our Tier 1 balance sheet is a strategic asset that underpins our consistent growth and continued value creation. I would like to take this opportunity to thank all our employees, customers, and the shareholders for placing your trust in us. With that, I will now hand it over to Genuino to talk more about our financial performance.

Thank you, Aditya, and good afternoon, everyone. We delivered a resilient performance last year despite the challenging market backdrop. EBITDA was $7.1 billion for the year, which translates to $130 of EBITDA per ton shipped. This is almost double the level of previous cycle lows, showing that the business and its earning capacity has structurally transformed. The benefits of our optimized asset base and our relatively diversified exposures have also seen our results show significantly more stability than peers. This was particularly evident in the fourth quarter. Adjusted net income of 2.3 billion in 2024 represents a 4.4 return on the book value of equity, which now stands at $64 per share. Return on capital employed in 2024 was 6%. Considering where we are in the cycle, I believe both these figures are commendable. Moving on to cash flow, we generated over $2 billion of investable cash flow in 2024, bringing the total to $21 billion since 2021. Last year, we invested $1.3 billion in the high-return strategic growth projects that Aditya described. We retired $1.7 billion to shareholders, including the repurchase of 6% of our outstanding shares. And we invested a net $0.6 billion in M&A, including, of course, our 28% stake in Valrec. Our performance provides strong evidence that ArcelorMittal can deliver value through all aspects of the steel cycle and is testament to the progress we have made in recent years. I believe this is reflecting the dividend increase to 55 US cents per share. This is a 10% increase on last year's dividend and brings the total increase since 2020 to over 80%. Finally, on the outlook, we are forecasting slightly positive apparent demand growth and are well positioned to benefit from any recovery. We are confident we will continue to generate positive cash flow this year and beyond, which will continue to be allocated via our established capital return policy. With that, Daniel, I believe we can move to the Q&As.