Dividend :1.2 euros per share, 85% increase per share
Earnings per share of 6.26 euros
ROCE : 26.5 (return on capital employed)
Successful global growth
Outstanding management gains
Strong cash-flow generation
Demonstrated increased resilience to industry cycle

2005 Highlights (PDF Version)
In the fourth year since its creation, Arcelor reports outstanding results with a gross operating result of EUR 5.6 billion and a net result, group share of EUR 3.8 billion. Strong cash generation allowed further debt reduction of 1.3 billion in 2005.

At 1,252 million euros, net profit, group share, for the fourth quarter, shows excellent resilience of results despite adverse market conditions added to year end seasonal effects.

Resolutely profitable and growth oriented: 2005 highlights

EUR 1.9 billion cumulated management gains on an annual basis since the creation of Arcelor in 2002. Target of EUR 700 million merger related synergies achieved one year ahead of schedule;
Continuous improvement of profitability - through cost cutting and restructuring of its European base and Brazilian expansion;
Margins protected by production levels adaptation to market needs in Europe;
Active portfolio management;
Continuous improvement of safety ratios at group level: accident frequency rates divided by four since 2002;
Number one steelmaker in Latin America with the creation of Arcelor Brasil and the acquisition of a majority stake in Acesita.
These structural enhancements have improved the Group's risk profile which benefits now from an enhanced portfolio of products and a broadened, highly competitive global industrial base. The addition of Canadian steelmaker Dofasco will further strengthen Arcelor's global industry leadership position.

The Board of Directors meeting on February 15th, 2006 under the chairmanship of Joseph Kinsch reviewed the financial elements of the Group and the Company for 2005.

The Board of Directors will propose to the shareholders' meeting a gross dividend of 1.20 euros per share (0.65 euros in 2004). Dividend will be paid on May 28th, 2006, subject to General Assembly.

At December 31st, 2005, net result, group share, amounted to 3,846 million euros compared to 2,314 million for the year 2004.

For the fourth quarter 2005, net profit group share amounted to 1,252 million euros.

Consolidated revenue for the Group in 2005 was 32,611 million euros compared to 30,176 million for 2004, or an increase of 8.1 percent (3.9 percent on a comparable basis). The fiscal year has been characterized by a severe drop on spot prices along the third quarter leading to significant reduction of shipments (-3.4percent on total and -12.9 percent in Europe) and production cuts (-11.4 percent in Europe).

Consolidated revenue for the fourth quarter was 8,352 million euros compared to 8,431 million for the fourth quarter of 2004. Consolidated revenue include Acesita, consolidated as of October 1st, 2005.

Geographical breakdown of sales was as follows: 71.2 percent in the EU (25), 9.1 percent in North America, 10.8 percent in South America and 8.9 percent in the rest of the world. Growth in South America is mainly due to the consolidation of Acindar (Long Carbon Steel, Argentina) and CST (Flat Carbon Steel, Brazil) for the full year.

Consolidated gross operating result amounts to 5,641 million euros in 2005, compared to 4,341 million in 2004 and comprises 106 million of non recurring items. Management gains and the full consolidation of CST (Brazil) and Acindar (Argentina) added to average selling prices (except for stainless) have contributed to this excellent performance despite a strong increase in raw materials prices.

Consolidated gross operating profit amounted to 1,136 million euros for the fourth quarter of 2005 compared to 1,464 million for the fourth quarter 2004, reflecting lower volumes and full effect of raw materials cost impact as well as the effect of seasonal year end effects.

Consolidated operating result was 4,376 million euros in 2005 against 3,194 million in 2004 including 198 million of non recurring items.

Consolidated operating profit for the last quarter 2005 was 933 million euros, to be compared with 1,122 million for the equivalent period of 2004.

After net financial charges of 254 million euros, a positive contribution from associates of 317 million, taxes of 161 million and minority interests for 432 million, consolidated net result, group share, was 3,846 million euros, compared to 2,314 million in 2004.

The fiscal charge amounts to 161 million euros, i.e. an effective tax rate of 3.9 percent. The current charge of 396 million euros (360 million for 2004) has been reduced by a deferred tax income of 235 million euros. This has been essentially generated by the capitalization, according to IFRS, of tax losses carried forward, valued on a yearly basis, and following the positive outlook of the Group's business plans.

Net profit, group share for the fourth quarter 2005 was 1,252 million euros compared to 820 million for the fourth quarter of 2004. This profit includes 113 million of financing costs, compared to 196 for 2004, 445 million of tax income compared to a tax expense of 17 million for 2004 and 75 million for minority interests compared to 156 million for 2004.

Key figures of the Group
In millions of euros 2004* 2005***
Revenues 30,176 32,611
Gross Operating Result 4,341 5,641
Operating Result 3,194 4,376
Net Result, Group share 2,314 3,846
Earnings per share (in euro) 4.26** 6.26****

* CST consolidated as of October 1st, Acindar consolidated as of May 1s
* * Including 106,629,054 new shares issued on July 27th2004, and excluding treasury shares
*** Acesita consolidated as of October 1st, 2005
**** Excluding treasury shares

Evolution of net financial debt

Net financial debt was reduced by 1 255 million euros during the fiscal year 2005 (1,257 million euros at December 31st, 2005 against 2,512 million at December 31st, 2004).

A strong cash generation allowed to efficiently manage working capital requirements, with a tight control over inventories and despite high cost of raw materials impact. Total capital expenditures amounting to 2 billion euros reflect expansion in Brazil (increase of production of 2.5 million tons at CST) and were kept at an optimized level in Europe (1.1 billion euros).

Net financial debt/shareholders' equity ratio, including minority interests was 0.07 at December 31, 2005 compared to 0.20 at December 31, 2004, thus much lower than 0.35 to 0.50 target over the cycle.

Outlook
In 2005 world steel production has grown by 6 percent, apparent consumption representing more than a billion tons. This growth has been very different by regions: excluding China growth was 1 percent negative due to a strong destocking phase in the US and in Europe (25). China showed 23 percent growth, representing 32 percent of world steel demand.

For 2006 at an expected 7 percent, world growth should be more balanced, with apparent consumption in China increasing by 10 percent due to high inventories while the growth in the rest of the world could reach 5 percent, benefiting from apparent consumption growth which could reach 5 percent in EU 25 and of 7 percent in North America boosted by the rebuilding of inventories after a significant depletion at the end of 2005.

Reactie XEA.nl
Dit resultaat kan ook een voorloper zijn voor de cijfers van Corus op 16 maart a.s. Daar zal de extra winst bijdrage uit Engeland moeten komen. Daar zal de reorganisatie haar vruchten gaan afwerpen bij Corus.