ArcelorMittal's SA unit profit up by 45%

ArcelorMittal SA, the South African unit of the world’s number one steel maker, posted a 45% rise in first-half earnings per share on Wednesday on buoyant global steel prices and a weaker rand.

The company said it expected third-quarter profit to be “substantially” higher than in the second quarter as demand and prices remained robust, but that earnings would be hit by higher costs and exchange rate swings.

The company’s shares rose 4,7% to R201 by 7.37am GMT as steelmakers jumped following parent firm ArcelorMittal reporting a better-than-expected 51% rise in second-quarter core profit.

ArcelorMittal SA said headline EPS, which strips out certain one-offs, non-trading and financial items, rose to 1 027 cents in the six months to end June from 708 cents in the year-ago period.

Headline earnings totalled R4,6-billion, boosted by higher international steel prices and strong demand at home from a construction boom.

Income from its coke and chemicals and marketing and shipping businesses also lifted earnings, as did a weaker rand versus the dollar. But that was partially offset by lower sales volumes and higher costs.

Revenue rose 26% to R18,4-billion while profit from operations rose 28% to R5,4-billion rand. - Reuters

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