Talks with IDC continue.
In its recent results released for the six months ended 30 June 2026, JSE-listed ArcelorMittal South Africa (AMSA) reported continued progress in repositioning the business despite exceptionally difficult market conditions characterised by weak domestic demand, elevated imports and global steel overcapacity.
The SENS announcement continued: “Over the past eighteen months, the Company has fundamentally reshaped its operating model through decisive actions aimed at improving sustainability and competitiveness. The placement of the long steel business into care and maintenance, together with procurement savings, reliability improvements, fixed-cost reductions and operational simplification, is beginning to deliver tangible results.”
“Crude steel production declined by 35% or 5% on a like-for-like basis (excluding the effect of the Newcastle closure), and revenue decreased by 30% or 1.4% on a like-for-like basis (excluding the effect of the Newcastle closure). The underlying performance of the business continued to improve. Quarterly EBITDA performance strengthened significantly from a loss of R1.1 billion in the third quarter of 2025 to near break-even levels in the second quarter of 2026, reflecting the benefits of the turnaround initiatives already implemented.”
“The South African steel market remained under pressure during the reporting period. Although apparent steel consumption increased by 2% to approximately 1.3 million tons, imports continued to account for 47% of domestic demand, constraining local industry growth and placing significant pressure on producers. Total steel sales volumes declined by 28% to 758 000 tons following the closure of Newcastle Works, while flat steel sales volumes increased by 3% to 684 000 tons, demonstrating resilience in core customer markets.”
“Government efforts to strengthen trade protection measures and support localisation gained momentum during the period. ArcelorMittal South Africa continues to engage actively with policymakers and industry stakeholders to improve the competitiveness and sustainability of the domestic steel industry.”
“The Company reported an EBITDA loss of R409 million, while headline loss increased to R1.49 billion. Free cash outflow for the period amounted to R1.2 billion, reflecting elevated inventory levels, the wind-down of the Longs operations and the close-out of a legacy supplier financing facility. Net borrowings increased to R7.9 billion.”
“Shareholders are referred to the various cautionary announcements released on the Stock Exchange News Service of the JSE Limited, the most recent being released on 16 July 2026, in which we advised that discussions between ArcelorMittal South Africa, ArcelorMittal Group, and the Industrial Development Corporation Limited (IDC) continue in respect of a potential transaction, and after some delay in the anticipated timelines, the parties are now at an advanced stage to finalise agreement regarding the potential transaction. The discussions remain subject to the conclusion of definitive agreements and receipt of various approvals. Further announcements will be made in relation to these matters as and when appropriate.”
“Looking ahead, market conditions are expected to remain challenging during the second half of 2026. However, increased infrastructure investment, anticipated policy support, fair-trade measures and continued operational improvements are expected to provide growing support to the steel value chain and improve industry prospects into 2027.”
“The Company will continue to focus on cost competitiveness, productivity improvements, energy and logistics optimisation, and unlocking value from non-core assets and operations currently under care and maintenance. Safety remains the Company’s highest priority as it continues its journey towards Zero Harm.”
Commenting on the results, Chief Executive Officer, Kobus Verster, said: “Although market conditions remain exceptionally difficult, the business we have today is significantly stronger than it was eighteen months ago. The difficult decisions we have taken are beginning to deliver measurable improvements in our underlying performance. Our priority remains completing the turnaround, restoring sustainable profitability and positioning ArcelorMittal South Africa for long-term success.”
