[PDF] FORM 20-F ARCELORMITTAL Feb 22 2019 ArcelorMittal's

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 20-F

REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2018

OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 OR SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number 001-35788

ARCELORMITTAL

(Exact name of Registrant as specified in its charter) N/A (Translation of Registrant's name into English)

Grand Duchy of Luxembourg

(Jurisdiction of incorporation or organization)

24-26, Boulevard d'Avranches, L-1160 Luxembourg,

Grand Duchy of Luxembourg

(Address of Registrant's principal executive offices) Henk Scheffer, Company Secretary, 24-26, Boulevard d'Avranches, L-1160 Luxembourg,

Grand Duchy of Luxembourg. Fax: +352 4792 2235

(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person) Securities registered or to be registered pursuant to Section 12(b) of the Act: Title of each className of each exchange on which registered

Ordinary SharesNew York Stock Exchange

Securities registered or to be registered pursuant to Section 12(g) of the Act: None Securities for which there is reporting obligation pursuant to Section 15(d) of the Act: None

Indicate the number of outstanding shares of the issuer's classes of capital or common stock as of the close of the period covered by the annual report:

Ordinary Shares

1,013,568,258

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes No

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934.

Yes No

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934

during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing

requirements for the past 90 days. Yes No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of

Regulation S

T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or an emerging growth company. See

definition of "accelerated filer, large accelerated filer and emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

Non-accelerated filer

Emerging growth company

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to

use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange

Act.

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

U.S. GAAP

International Financial Reporting Standards as issued by the International Accounting Standards Board Other

If "Other" has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to

follow.

Item 17

Item 18

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes No

TABLE OF CONTENTS

Page PRESENTATION OF FINANCIAL AND CERTAIN OTHER INFORMATION CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

PART I

ITEM 1.IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS

ITEM 2.OFFER STATISTICS AND EXPECTED TIMETABLE

ITEM 3.KEY INFORMATION

A.Selected financial data

B.Capitalization and indebtedness

C.Reasons for the offer and use of proceeds

D.Risk factors

ITEM 4.INFORMATION ON THE COMPANY

A.History and development of the Company

B.Business overview

C.Organizational structure

D.Property, plant and equipment

ITEM 4A.UNRESOLVED STAFF COMMENTS

ITEM 5.OPERATING AND FINANCIAL REVIEW AND PROSPECTS

A.Operating results

B.Liquidity and capital resources

C.Research and development, patents and licenses

D.Trend information

E.Off-balance sheet arrangements

F.Tabular disclosure of contractual obligations

G.Safe harbor

ITEM 6.DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

A.Directors and senior management

B.Compensation

C.Board practices/corporate governance

D.Employees

E.Share ownership

ITEM 7.MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

A.Major shareholders

B.Related party transactions

C.Interest of experts and counsel

ITEM 8.FINANCIAL INFORMATION

A.Consolidated statements and other financial information

B.Significant changes

ITEM 9.THE OFFER AND LISTING

A.Offer and listing details

B.Plan of distribution

C.Markets

D.Selling shareholders

E.Dilution

F.Expenses of the issue

ITEM 10.ADDITIONAL INFORMATION4

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A.Share capital

B.Memorandum and Articles of Association

C.Material contracts

D.Exchange controls

E.Taxation

F.Dividends and paying agents

G.Statements by experts

H.Documents on display

I.Subsidiary information

ITEM 11.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK ITEM 12.DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

A.Debt securities

B.Warrants and rights

C.Other securities

D.American depositary shares

PART II

ITEM 13.DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES ITEM 14.MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS

ITEM 15.CONTROLS AND PROCEDURES

ITEM 16A.AUDIT & RISK COMMITTEE FINANCIAL EXPERT

ITEM 16B.CODE OF ETHICS

ITEM 16C.PRINCIPAL ACCOUNTANT FEES AND SERVICES

ITEM 16D.EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES ITEM 16E.PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS ITEM 16F.CHANGE IN REGISTRANT'S CERTIFYING ACCOUNTANT

ITEM 16G.CORPORATE GOVERNANCE

ITEM 16H.MINE SAFETY DISCLOSURE

PART III

ITEM 17.FINANCIAL STATEMENTS

ITEM 18.FINANCIAL STATEMENTS

ITEM 19.EXHIBITS203

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4PRESENTATION OF FINANCIAL AND CERTAIN OTHER INFORMATION

Definitions and terminology

Unless indicated otherwise, or the context otherwise requires, references herein to "ArcelorMittal", "we", "us", "our" and

the "Company" or similar terms are to ArcelorMittal, formerly known as Mittal Steel Company N.V. ("Mittal Steel"), having its

registered office at 24-26, Boulevard d'Avranches, L-1160 Luxembourg, Grand Duchy of Luxembourg, and, where the context

requires, its consolidated subsidiaries. References to the "ArcelorMittal group" and the "Group" are to ArcelorMittal and its

consolidated subsidiaries. ArcelorMittal's principal subsidiaries, categorized by reporting segment and location, are listed

below.

For the purposes of this annual report, the names of the following ArcelorMittal subsidiaries as abbreviated below will be used

where applicable.

Name of SubsidiaryAbbreviationCountry

NAFTA ArcelorMittal Dofasco G.P.ArcelorMittal DofascoCanada ArcelorMittal México S.A. de C.V.ArcelorMittal MexicoMexico

ArcelorMittal USA LLCArcelorMittal USAUSA

ArcelorMittal Long Products Canada G.P.ArcelorMittal Long Products CanadaCanada

Brazil and neighboring countries ("Brazil")

ArcelorMittal Brasil S.A.ArcelorMittal BrasilBrazil Acindar Industria Argentina de Aceros S.A.AcindarArgentina

Europe

ArcelorMittal Atlantique et Lorraine S.A.S.ArcelorMittal Atlantique & LorraineFrance ArcelorMittal Belgium N.V.ArcelorMittal BelgiumBelgium ArcelorMittal España S.A.ArcelorMittal EspañaSpain ArcelorMittal Flat Carbon Europe S.A.AMFCELuxembourg ArcelorMittal Galati S.A.1ArcelorMittal GalatiRomania ArcelorMittal Poland S.A.ArcelorMittal PolandPoland ArcelorMittal Eisenhüttenstadt GmbHArcelorMittal EisenhüttenstadtGermany ArcelorMittal Bremen GmbHArcelorMittal BremenGermany ArcelorMittal Méditerranée S.A.S.ArcelorMittal MéditerranéeFrance ArcelorMittal Belval & Differdange S.A.ArcelorMittal Belval & DifferdangeLuxembourg ArcelorMittal Hamburg GmbHArcelorMittal HamburgGermany ArcelorMittal Ostrava a.s.1ArcelorMittal OstravaCzech Republic ArcelorMittal Duisburg GmbHArcelorMittal DuisburgGermany ArcelorMittal International Luxembourg S.A.ArcelorMittal International LuxembourgLuxembourg ArcelorMittal Italia S.p.A.2ArcelorMittal ItaliaItaly Africa and Commonwealth of Independent States ("ACIS") ArcelorMittal South Africa Ltd.ArcelorMittal South AfricaSouth Africa JSC ArcelorMittal TemirtauArcelorMittal TemirtauKazakhstan PJSC ArcelorMittal Kryvyi RihArcelorMittal Kryvyi RihUkraine

Mining

ArcelorMittal Mining Canada G.P. and ArcelorMittal InfrastructureCanada G.P.ArcelorMittal Mines and InfrastructureCanadaCanada

ArcelorMittal Liberia LtdArcelorMittal LiberiaLiberia JSC ArcelorMittal TemirtauArcelorMittal TemirtauKazakhstan PJSC ArcelorMittal Kryvyi RihArcelorMittal Kryvyi RihUkraine

1. ArcelorMittal Galati S.A. and ArcelorMittal Ostrava a.s. were classified as held for sale as of December 31, 2018.

2. On November 1, 2018, ArcelorMittal completed the acquisition of Ilva S.p.A. subsequently renamed ArcelorMittal Italia S.p.A. See "Item 4.A -

Information on the Company - History and development of the Company - Key transactions and events in 2018."

5In addition, unless indicated otherwise, or the context otherwise requires, references in this annual report to abbreviations

or terms shown below have the following definitions:

Articles of Associationthe amended and restated articles of association ofArcelorMittal, dated May 16, 2018, filed asExhibit 1.1 heretoKZTthe Kazakhstani tenge, the official currency ofKazakhstan

AUD$ or AUDAustralian dollars, the official currency ofAustraliaMetallurgical coala broader term than coking coal that includes allcoals used in steelmaking, such as coal used forthe pulverized coal injection ("PCI") process

Brownfield projectthe expansion of an existing operationNumber of employeesemployees on the payroll of the Company

C$ or CADCanadian dollars, the official currency of CanadaProduction capacitythe annual production capacity of plant andequipment based on existing technical parametersas estimated by management

CEO Officethe Chief Executive Officer, Mr. Lakshmi N.Mittal, and the President and Chief FinancialOfficer, Mr. Aditya MittalPs or MXNthe Mexican peso, the official currency of theUnited Mexican States

CISthe countries of the Commonwealth ofIndependent StatesReal, reais or R$Brazilian reais, the official currency of Brazil

CNYChinese yuan, the official currency of ChinaROMrun of mine - mined iron ore or coal to be fed to apreparation and/or concentration process

Coking coalcoal that, by virtue of its coking properties, is usedin the manufacture of coke, which is used in thesteelmaking processSalesinclude shipping and handling fees and costsbilled to a customer in a sales transaction

Crude steelthe first solid steel product upon solidification ofliquid steel, including ingots from conventionalmills and semis (e.g., slab, billet and blooms)from continuous castersSBQspecial bar quality steel, a high-quality longproduct

Downstreamfinishing operations: flat products - the processafter the production of hot-rolled coil/plates, andlong products - the process after the production ofblooms/billets (including production of bars, wirerods, SBQ, etc.)SignificantShareholdera trust (HSBC Trustee (C.I.) Limited, as trustee),of which Mr. Lakshmi N. Mittal, Mrs. Usha Mittaland their children are the beneficiaries

DMTU or dmtudry metric tonne unitSintera metallic input used in the blast furnace steel-making process, which aggregates fines, binderand other materials into a coherent mass byheating without melting

DRIdirect reduced iron, a metallic iron formed byremoving oxygen from iron ore without theformation of, or passage through, a smeltingphase. DRI can be used as feedstock for steelproductionSpanish StockExchangesthe stock exchanges of Madrid, Barcelona, Bilbaoand Valencia

Energy coalcoal used as a fuel source in electrical powergeneration, cement manufacture and variousindustrial applications. Energy coal may also bereferred to as steam or thermal coalSteel productsfinished and semi-finished steel products, andexclude raw materials (including those describedunder "upstream" below), direct reduced iron("DRI"), hot metal, coke, etc.

Euro, euros, EUR or €the official currency of the European Union

("EU") member states participating in theEuropean Monetary UnionTons, net tons or STshort tons are used in measurements involving

steel products (a short ton is equal to 907.2kilograms or 2,000 pounds)

Executive Officersthose executives of the Company who aresupporting the CEO Office and jointly with theCEO Office represent the senior management ofthe CompanyMetric Tonnes or MTmetric tonnes and are used in measurementsinvolving steel products, as well as crude steel,iron ore, iron ore pellets, DRI, hot metal, coke,coal, pig iron and scrap (a metric tonne is equal to1,000 kilograms or 2,204.62 pounds)

6GMBthe Group Management Board, the former seniormanagement body which was replaced by theCEO Office as of January 1, 2016. The CEOOffice, supported by five Executive Officers,makes up the Company's senior managementUAHUkrainian Hryvnia, the official currency ofUkraine

Greenfield projectthe development of a new projectUS$, $, dollars, USDor U.S. dollarsUnited States dollars, the official currency of theUnited States

Iron ore finesultra-fine iron ore generated by mining andgrinding processes, that are aggregated into ironore pellets through an agglomeration process orused as sinter feedUpstreamoperations that precede downstream steel-making,coking coal, coke, sinter, DRI, blast furnace, basicoxygen furnace ("BOF"), electric arc furnace("EAF"), casters & hot rolling/plate mill

Iron pelletsagglomerated ultra-fine iron ore particles of a sizeand quality suitable for use in steel-makingprocessesWet recoverablea quantity of iron ore or coal recovered after thematerial from the mine has gone through apreparation and/or concentration processexcluding drying

Kilometersmeasures of distance are stated in kilometers, eachof which equals approximately 0.62 miles, or inmeters, each of which equals approximately 3.28feetZARSouth African rand, the official currency of theRepublic of South Africa

Financial information

This annual report contains the audited consolidated financial statements of ArcelorMittal and its consolidated subsidiaries,

including the consolidated statements of financial position as of December 31, 2018 and 2017, and the consolidated statements

of operations, other comprehensive income, changes in equity and cash flows for each of the years ended December 31, 2018,

2017 and 2016. ArcelorMittal's consolidated financial statements were prepared in accordance with International Financial

Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB").

The financial information and certain other information presented in a number of tables in this annual report have been

rounded to the nearest whole number or the nearest decimal. Therefore, the sum of the numbers in a column may not conform

exactly to the total figure given for that column. In addition, certain percentages presented in the tables in this annual report

reflect calculations based upon the underlying information prior to rounding and, accordingly, may not conform exactly to the

percentages that would be derived if the relevant calculations were based upon the rounded numbers. This annual report on

Form 20-F includes net debt and operating working capital, which are non-GAAP financial measures. ArcelorMittal believes

net debt and operating working capital to be relevant to enhance the understanding of its financial position and provides

additional information to investors and management with respect to the Company's operating cash flows, capital structure and

credit assessment. Non-GAAP financial measures should be read in conjunction with and not as an alternative for,

ArcelorMittal's financial information prepared in accordance with IFRS. Such non-GAAP measures may not be comparable to

similarly titled measures applied by other companies.

Market information

This annual report includes industry data and projections about the Company's markets obtained from industry surveys,

market research, publicly available information and industry publications. Statements on ArcelorMittal's competitive position

contained in this annual report are based primarily on public sources including, but not limited to, publications of the World

Steel Association. Industry publications generally state that the information they contain has been obtained from sources

believed to be reliable but that the accuracy and completeness of such information is not guaranteed and that the projections

they contain are based on a number of significant assumptions. The Company has not independently verified this data or

determined the reasonableness of such assumptions. In addition, in many cases the Company has made statements in this annual

report regarding its industry and its position in the industry based on internal surveys, industry forecasts and market research, as

well as the Company's experience. While these statements are believed to be reliable, they have not been independently

verified.

7CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This annual report and the documents incorporated by reference in this annual report contain forward-looking statements

based on estimates and assumptions. This annual report contains forward-looking statements within the meaning of the Private

Securities Litigation Reform Act of 1995. Forward-looking statements include, among other things, statements concerning the

business, future financial condition, results of operations and prospects of ArcelorMittal, including its subsidiaries. These

statements usually contain the words "believes", "plans", "expects", "anticipates", "intends", "estimates" or other similar

expressions. For each of these statements, you should be aware that forward-looking statements involve known and unknown

risks and uncertainties. Although it is believed that the expectations reflected in these forward-looking statements are

reasonable, there is no assurance that the actual results or developments anticipated will be realized or, even if realized, that

they will have the expected effects on the business, financial condition, results of operations or prospects of ArcelorMittal.

These forward-looking statements speak only as of the date on which the statements were made, and no obligation has been

undertaken to publicly update or revise any forward-looking statements made in this annual report or elsewhere as a result of

new information, future events or otherwise, except as required by applicable laws and regulations. A detailed discussion of

principal risks and uncertainties which may cause actual results and events to differ materially from such forward-looking

statements is included in the section titled "Risk factors" (Part I, Item 3D of this Annual Report on Form 20-F). The Company

undertakes no obligation to update or revise publicly any forward-looking statements whether because of new information,

future events, or otherwise, except as required by securities and other applicable laws.

PART I

ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS

Not applicable.

ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE

Not applicable.

ITEM 3. KEY INFORMATION

A. Selected financial data

The following tables present selected consolidated financial information of ArcelorMittal as of and for the years ended

December 31, 2018, 2017, 2016, 2015 and 2014, prepared in accordance with IFRS as issued by the IASB. This selected

consolidated financial information should be read in conjunction with ArcelorMittal's consolidated financial statements,

including the notes thereto, included elsewhere herein.

8Consolidated Statements of Operations

(Amounts in $ millions except per share data)Year ended December 31,

20182017201620152014

Sales76,03368,67956,79163,57879,282

Operating income/(loss)6,5395,4344,161(4,161)3,034

Net income/(loss) from continuing operations (including non-controlling interest)5,3304,5751,734(8,423)(974)

Net income/(loss) attributable to equity holders of the parent5,1494,5681,779(7,946)(1,086) Net income/(loss) (including non-controlling interest)5,3304,5751,734(8,423)(974)

Earnings per common share (in U.S. dollars)

Basic earnings (loss) per common share1, 25.074.481.87(10.29)(1.43) Diluted earnings (loss) per common share1, 25.044.461.86(10.29)(1.43)

Dividends declared per share3,40.200.10 - - 0.45

Consolidated Statements of Financial Position

(Amounts in $ millions except share data)As of December 31,

20182017201620152014

Total assets91,24985,29775,14276,84699,179

Net assets44,10840,85532,32527,57045,160

Share capital36440140110,01110,011

Basic weighted average common shares outstanding (millions)21,0151,020953772771 Diluted weighted average common shares outstanding (millions)21,0211,024955772771

1 Basic earnings per common share are computed by dividing net income attributable to equity holders of ArcelorMittal by the weighted average number of

common shares outstanding during the periods presented. Diluted earnings per common share include assumed shares from stock options, shares from

restricted stock units and convertible debt (if dilutive) in the weighted average number of common shares outstanding during the periods presented. See note

10.3 to the consolidated financial statements for further information.

2 Following the Company's equity offering in April 2016, the earnings (loss) per share for prior periods have been recast in accordance with IFRS for the years

ended December 31, 2015 and 2014, respectively, to include the bonus element derived from the 35% discount to the theoretical ex-right price included in

the subscription price. Following the completion of the Company's share consolidation of each three existing shares into one share without nominal value on

May 22, 2017, the earnings (loss) per share and corresponding basic and diluted weighted average common shares outstanding for the years ended December

31, 2016, 2015 and 2014, respectively, have been recast in accordance with IFRS.

3 Following the Company's equity offering in April 2016, the dividends declared per share for prior periods have been recast for the year ended December 31,

2014 to include the bonus element derived from the 35% discount to the theoretical ex-right price included in the subscription price. The actual dividends

paid was $0.20 per issued share as of December 31, 2014. Following the completion of the Company's share consolidation of each three existing shares into

one share without nominal value on May 22, 2017, the dividends declared per share for the year ended December 31, 2014 was recast.

4 The Board has agreed on a new dividend policy which was approved by the shareholders at the AGM in May 2018. Given the current deleveraging focus,

dividends began at $0.10 per share in 2018 (paid from 2017 results). The Board is proposing an increase in the base dividend for 2019 (paid from 2018

earnings) to $0.20 per share to the shareholders at the annual shareholders meeting in May 2019.

B. Capitalization and indebtedness

Not applicable.

C. Reasons for the offer and use of proceeds

Not applicable.

9D. Risk factors

ArcelorMittal's business, financial condition, results of operations, reputation or prospects could be materially adversely

affected by one or more of the risks and uncertainties described below. Risks related to the global economy and the mining and steel industry

ArcelorMittal's business and results are substantially affected by regional and global macroeconomic conditions.

Recessions or prolonged periods of weak growth in the global economy or the economies of ArcelorMittal's key selling

markets have in the past had and in the future would be likely to have a material adverse effect on the mining and steel

industries and on ArcelorMittal's results of operations and financial condition.

The mining and steel industries have historically been highly volatile largely due to the cyclical nature of the business

sectors that are the principal consumers of steel as described above. Demand for minerals, metals and steel products thus

generally correlates to macroeconomic fluctuations in the global economy. This correlation and the adverse effect of

macroeconomic downturns on metal mining companies and steel producers were evidenced in the 2008/2009 financial and

subsequent economic crisis, for example, during which the results of both mining companies and steel producers were

substantially affected, with many steel producers (including ArcelorMittal) recording sharply reduced revenues and operating

losses.

Global steel demand has improved since 2015, when global apparent steel consumption contracted notably in China and

most of ArcelorMittal's core markets except Europe. Global economic growth was particularly strong during the second half of

2017 and the first half of 2018. Growth slowed less than anticipated in China in 2018 as strength in real estate and machinery

partially offset weakness in automotive growth and a slowdown in infrastructure. There is, however, a risk of a significant

slowdown in Chinese growth in 2019 due in particular to the potential fall-out from the trade dispute with the United States and

the real estate market likely having reached a peak. In Europe, a major market for ArcelorMittal, results have suffered in prior

years from recession and stagnation. After a period of robust industrial activity in late 2017 and early 2018, momentum has

eased amid moderating export growth and less accommodative policies. Slowing global trade and increased uncertainty have

negatively impacted industry, with the weakness amplified by a larger-than-expected temporary decline in automotive output

due to regulatory changes. While economic conditions have improved in recent periods in many of ArcelorMittal's other

markets, including Brazil and the CIS, such improvements may prove fragile. Economic conditions have remained challenging

in some of the Company's other markets, including South Africa, which suffered a technical recession during the first half of

2018 but has since gradually recovered.

Overall, the short-term outlook for 2019 global GDP growth is an expected slowdown to 2.7% down from 3.0% in 2018.

Leading indicators support a slowdown in growth in the U.S. to a still robust 2.4%, despite the fading fiscal stimulus and tighter

financial conditions. While growth in Europe weakened sharply during the second half of 2018, growth is still expected to

recover to average 1.7% in 2019 as consumer expenditure is supported by low unemployment and weak inflation. Chinese

growth is also expected to slow, and while growth in some emerging markets is likely to improve, notably Brazil, others are

likely to see growth capped by rising borrowing costs as interest rates rise. More generally, there are many risks to the global

macro-economic outlook in 2019, including (among other things) monetary policy uncertainty; geopolitical tensions globally;

political tensions in Europe; unsolved sovereign debt issues in many southern European countries; threats to globalization by

renewed protectionism, including rising trade tensions stemming from the U.S imposition of tariffs on steel and aluminum

imports and international responses thereto; the lack of progress in Brexit negotiations raising the risk of a disruptive exit with

potential far-reaching consequences including the imposition of potential trade barriers, custom duties, logistic issues and

restrictions to the free movement of goods and people; high levels of government, corporate and consumer indebtedness in

various countries (including high levels of indebtedness in emerging markets) and a potentially significant slowdown in

Chinese growth. A materialization of any of these risks could depress demand for (and hence the price of) steel and iron ore and

therefore have a material adverse effect on ArcelorMittal's results of operations and financial condition.

Excess capacity and oversupply in the steel industry and in the iron ore mining industry have in the past and may

continue in the future to weigh on the profitability of steel producers, including ArcelorMittal.

The steel industry is affected by global and regional production capacity and fluctuations in steel imports and exports,

which are themselves affected by the existence and amounts of tariffs and customer stocking and destocking cycles. The steel

industry globally has historically suffered from structural overcapacity, and the current global steelmaking capacity exceeds the

10current global consumption of steel. This overcapacity is amplified during periods of global or regional economic weakness due

to weaker global or regional demand. In particular, China is both the largest global steel consumer and the largest global steel

producer by a large margin, and the balance between its domestic production and consumption has been an important factor

influencing global steel prices in recent years, such as in 2015, when Chinese domestic steel demand weakened resulting in a

surge in Chinese steel exports. While the structural imbalance between Chinese supply and demand has been reduced by

capacity eliminations in recent years, if Chinese capacity were to increase again, and/or if Chinese demand were to weaken

significantly, there could be a renewed flood of Chinese steel exports. Other developing markets (such as Brazil, Russia and

Ukraine) continue to show structural overcapacity after domestic demand fell sharply during recent recessions, and developed

Asia continues to exhibit overcapacity and the need to export significant volumes onto world markets. Regional steel markets

are also vulnerable at times of economic crisis in countries with significant steel making capacity. One such example is Turkey

where a currency crisis has caused domestic demand to decline sharply during the second half of 2018 and leading to a pick-up

in exports, particularly for long steel products. In Europe, while the rebound in demand has lessened the structural imbalance

between capacity and demand, a decrease in demand would mean a return to the structural overcapacity issues that have

plagued the EU 28 for years. Finally, in the United States, improved economic conditions and the pricing support from the

Section 232 tariffs have led to new capacity being built and previously idled capacity re-opened, increasing the risk of

oversupply and overcapacity in the event of a market downturn.

The overcapacity of steel production in the developing world and in China in particular has weighed on global steel prices

at times over the past decade, as exports have surged to Europe and NAFTA, ArcelorMittal's principal markets, often at low

prices that may be at or below the cost of production, depressing steel prices in regional markets world-wide. See "Unfair trade

practices in ArcelorMittal's home markets could negatively affect steel prices and reduce ArcelorMittal's profitability while

trade sanctions and barriers may have an adverse effect on ArcelorMittal's operations in various markets." If global demand

were to weaken, such a phenomenon could happen again.

Finally, excess iron ore supply coupled with decreased demand in iron ore consuming industries, such as steel, has led to a

prolonged depression of iron ore prices at various points in recent years, in particular in 2015, which in turn weighed on steel

prices as iron ore is a principal raw material in steelmaking. While the supply/demand balance has improved more recently, no

assurance can be given that it will not deteriorate again, particularly if Chinese steel demand declines or worldwide capacity

increases due to new construction or the restart of production. A renewed phase of steel and iron ore oversupply would likely

have a material adverse effect on ArcelorMittal's results of operations and financial condition.

Protracted low steel and iron ore prices would likely have an adverse effect on ArcelorMittal's results of operations.

As an integrated producer of steel and iron ore, ArcelorMittal's results of operations are sensitive to the market prices of

steel and iron ore in its markets and globally. The impact of market steel prices on its results is direct. The impact of market iron

ore prices is both direct, as ArcelorMittal sells iron ore on the market to third parties, and indirect as iron ore is a principal raw

material used in steel production and fluctuations in its market price are typically and eventually passed through to steel prices.

Steel prices and iron ore prices are affected by supply trends (see above), demand trends and inventory cycles. In terms of

demand, steel and iron ore prices are sensitive to trends in cyclical industries, such as the automotive, construction, appliance,

machinery, equipment and transportation industries, which are significant markets for ArcelorMittal's products. In the past,

substantial price decreases during periods of economic weakness have not always been offset by commensurate price increases

during periods of economic strength. In addition, as indicated above, excess supply relative to demand in local markets

generally results in increased exports and drives down global prices. In terms of inventory, steel stocking and destocking cycles

affect apparent demand for steel and hence steel prices and steel producers' profitability. For example, steel distributors may

accumulate substantial steel inventories in periods of low prices and, in periods of rising real demand for steel from end-users,

steel distributors may sell steel from inventory (destock), thereby delaying the effective implementation of steel price increases.

Conversely, steel price decreases can sometimes develop their own momentum, as customers adopt a "wait and see" attitude

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