ArcelorMittal, a global steel and mining company, has already invested $1.2 billion in its Ukrainian subsidiary to ensure its survival. This information was shared by Maouro Longobardo, the CEO of ArcelorMittal Kryvyi Rih, in an interview with Interfax-Ukraine. Despite these investments, the outlook for profitability in 2026 remains negative, with potential losses of at least $150 million.
“It appears that we will incur these losses in Q1 due to the loss of markets and extremely high energy and raw material prices compared to any historical period. We could not have foreseen these costs in our budget. Earlier, we had predicted such losses for the entire year! This scenario of $150 million in losses in Q1 is quite alarming. It’s not what we expected, and we don’t see how this situation can improve,” said Longobardo.
Recently, the European Bank for Reconstruction and Development (EBRD) provided an additional credit of $200 million to ArcelorMittal Kryvyi Rih to boost its operating capital. Longobardo reminded that the EBRD had already provided support to the company, and the funds have been utilized. However, the repayment schedule has been restructured – it was originally planned to start at the end of 2025.
Attempts to secure financing from other major institutions have failed as no one was willing to take on the current risks, especially given the business’s financial projections. High energy and raw material prices are destroying any chance of profitability for the metkombinat. Longobardo also commented on his previous statement that ArcelorMittal might reconsider its presence in Ukraine if losses continue. He confirmed that if the situation does not improve, the company will make certain decisions, but it is difficult to predict what specific actions will be taken.
“It’s impossible to sustain a business with ongoing losses. This is an abnormal situation. Our company is a public corporation. For our shareholders, continuous losses are unacceptable. This is not a private company where the owner can decide to support unprofitable production for ten years. I can say that our shareholders will demand from us to provide options on how to improve the situation,” said Longobardo.
However, the positive outlook for Ukraine – the end of the war, reconstruction, and EU accession – helps maintain ArcelorMittal’s interest in the Kryvyi Rih assets. However, these fundamental steps need to be implemented. We remind you that PJSC “ArcelorMittal Kryvyi Rih” is facing further deterioration of its financial situation due to increased expenses on energy resources and logistics, which continues to put pressure on the production economy.
Висновок: ArcelorMittal has invested $1.2 billion into its Ukrainian subsidiary but faces potential losses of up to $150 million in Q1 2022 due to high energy and raw material prices. The company is restructuring its repayment schedule with the European Bank for Reconstruction and Development (EBRD) and has faced difficulties securing financing from other major institutions. If the situation does not improve, ArcelorMittal may take certain measures regarding its presence in Ukraine.