Financial results

For the year ended 31 December 2017

Disclaimer
Forward looking statements

This presentation includes forward-looking information and statements about ArcelorMittal South Africa (“AMSA”) and its subsidiaries
that express or imply expectations of future events or results. Forward-looking statements are statements that are not historical facts.
These statements include, without limitation, financial projections and estimates and their underlying assumptions, statements
regarding plans, objectives and expectations with respect to future production, operations, costs, products and services, and
statements regarding future performance. Forward-looking statements may, without limitation, be identified by words such as ‘believe,’
‘expect,’ ‘anticipate,’ ‘target,’ ‘plan,’ and other similar expressions. All forward-looking statements involve a number of risks,
uncertainties and other factors not within AMSA’s control or knowledge. Although AMSA’s management believes that the expectations
reflected in such forward-looking statements are reasonable, investors and holders of AMSA’s securities are cautioned that forward-
looking information and statements are subject to various risks and uncertainties, many of which are difficult to predict and generally
beyond the control of AMSA, that could cause actual results and developments to differ materially and adversely from those
expressed in, or implied or projected by, the forward-looking information and statements contained in this presentation. The risks and
uncertainties include those discussed or identified in the filings with the Johannesburg Stock Exchange (the “JSE”) made or to be
made by AMSA, including AMSA’s Annual Report of the year ended December 31, 2016 filed with the JSE. Factors that could cause
or contribute to differences between the actual results, performance and achievements of AMSA include, but are not limited to,
political, economic and business conditions, industry trends, competition, commodity prices, changes in regulation and currency
fluctuations. Accordingly, investors should not place reliance on forward looking statements contained in this presentation. The
forward-looking statements in this presentation reflect information available at the time of preparing this presentation and have not
been reviewed and reported on by AMSA’s auditors and apply only as of the date they are made. Subject to the requirements of the
applicable law, AMSA shall have no obligation and makes no undertaking to publicly update any forward-looking statements in this
presentation, whether as a result of new information, future events or otherwise or to publicly release the result of any revisions to any
forward-looking statements in this presentation that may occur due to any change in AMSA’s expectations or to reflect events or
circumstances after the date of this presentation. No statements made in this presentation regarding expectations of future profits are
profit forecasts or estimates.

2 Financial results for the year ended 31 December 2017

Contents page

Overview Steel Operational Financial Outlook Questions

market review review

Wim Wim Dean Dean Kobus The team

de Klerk de Klerk Subramanian Subramanian Verster

Financial results for the year ended 31 December 2017 3

Overview
Wim de Klerk
Safety

Lagging indicators
• 6% increase in LTIFR

• Improvement in plant and shop

TIFR floor audits
7.66 (9.50) DIFR
TIFR 0.87 (0.89) • 53 serious potential incidents
7.66 (9.50)
LTIFR Leading indicators
Zero fatalities in H2
0.66 (0.62)
• 19% improvement in TIFR
Three fatalities in H1
• Increase hazard awareness
Three fatalities in H1
• Decrease risk tolerance

• Visible felt leadership

LTIFR – Lost Time Injury Frequency Rate
DIFR – Disabling Injury Frequency Rate
TIFR – Total Injury Frequency Rate

Financial results for the year ended 31 December 2017 5

Salient features

Revenue Production Cost of sales H1 H2 Change

Item
19% 3% 21% 2017 2017 H1 to H2

EBITDA (R534m) +R219m +R753m

EBITDA Flat Raw materials
(315) 237kt (+7%) +27%

HEPS (148cps) (82cps) +66cps

HEPS Long Energy +6%
(230cps) 98kt (-6%) Employee 0%
%
Avg
R8 138 R8 540 +R402
NRP/t

Level 3 B-BBEE rating

19 %
6 Financial results for the year ended 31 December 2017
Initiatives
What we set out to do What we achieved
• Productivity improvements • Steel produced per employee up almost 2%

Short term
• Asset disposal • No substantial disposals
• Excess material • Fixed product stock declined by 36kt
Procurement

• Cost control over contracts • Liquid steel cost of production +16%

• Conclude lower electricity/rail tariffs • Still in negotiations
• Raw material analysis • Coal blend under investigation

• Benchmark initiatives • Done

Footprint

• Production lines • Coating strategy on the go

• Structural changes • Section 189 in progress
Commercial

• Industry protection measures • Import tariffs, safeguard duties & designation

• Improve market share & volume • Market share up to 73% in H2 (66% in H1)
• Focus on AoL • AoL sales volumes up by 7%

Financial results for the year ended 31 December 2017 7

Steel Market
Wim de Klerk
The industry - global

Global steel output (mt)

900
806 807
830 818 814 805
837 853
• Global crude steel production
782 798
800 increased by 87mt (+5.4%)
700 • Asia retained its market share at
600 69% and grew by 60mt of which
544 546 563 559 555 548 557
577 588 40mt came from China, despite
500 538
the latter announcing plant
400 closures and environmental
300
shutdowns

200 59 60 60 61 56 56 55 58 59
• African output was stable
55

100
73 71 76 69 88 78 83 80 86 84
0
2013 2014 2015 2016 2017
European Union Other Europe C.I.S.
North America South America Africa
Middle East Asia Oceania

Source: WorldSteel 9
Financial results for the year ended 31 December 2017
The industry – raw materials
International raw material basket ($/t) AMSA raw material basket (R/t)
100% 600 100% 10 000
20.0% 18.5% 19.6% 13.8% 15.3% 17.7% 9% 8% 12% 14% 14% 14%
80% 500 RMB 2016 2017 2016 2017
weight 80% 8 000
400 42% 43% 41%
30.5% 30.5% 32.1% 47.0% 41.3% International AMSA 44% 49% 49%
60% 43.4% 60% 6 000
300 Iron ore 43% 41% 45% 37%
40% 40% 4 000
200 Coking
41% 43% 42% 49%
coal 20% 2 000
20% 100 Scrap 16% 16% 13% 14% 49% 49% 48% 42% 37% 38%
50% 51% 48% 39% 43% 39% 0% -
0% 0
2015 2016 2017
2015 2016 2017
Iron ore Coking coal Scrap Coking coal
Iron ore AMSA domestic HRC
Scrap China HRC price
AMSA RMB
RMB

Commodity International AMSA ($/t) AMSA (R/t)

FY2017 % change FY2017 % change FY2017 % change
Iron ore $71/t (CFR North China) +23% $52/t (FOR) +16% R690/t (FOR) +4%
Hard coking coal $188/t (FOB) +33% $280/t (delivered) +86% R3 720/t (delivered) +70%
Scrap $307/t (Asia HMS) +31% $240/t (delivered) +29% R3 185/t (delivered) +19%
RMB total $277/t +28% $324/t +42% R4 315/t +32%
HRC $505/t +35% $639/t +36% R8 509/t +23%

Note: The Raw Material Basket (RMB) represents the costs of the raw materials in a tonne of finished steel
10 Financial results for the year ended 31 December 2017
Macro backdrop

South African GDP growth South African Q3 2017 GDP growth

-10% 10% 30% 50%
4%
44.2% Agriculture
2.8%
3% 6.6% Mining
2.0% 4.3% Manufacturing
2%
1.2% Finance
1% 0.9% Personal Services
0.6% Transport
0%
-0.4% Trade
-1% -0.6% -0.7% Government
-1.1% Construction
-2%
-5.5% Electricity
2014 2015 2016 2017

• SA economy remains weak with GDP growth mainly in low steel consuming sectors
• Agriculture accounts for 4% of steel demand while building & construction(B&C) is at >30%.
• Although GDP grew by 2.0% in Q3 2017, B&C contracted by 1% while agriculture expanded 44%
• 2017 GDP expected at <1% and 2018 >1% neither of which will drive steel demand growth
Source: StatsSA Financial results for the year ended 31 December 2017 11
 The industry - domestic

South African apparent steel consumption (ASC kt) and market share (%)
3 500 30%
• Domestic ASC has been
3 000
declining steadily since 2013
25%
15%
2 500 11%
• Imports (including Chinese steel
11% 11%
7%
15%
9%
10%
14% 8%
20% imports) peaked in 2015 at
8% 17% 12% 11%
2 000 20% 9%
11%
9% 9% almost 30% of market share but
15% 7% 14%
21%
20% 14% 11% 12% 15% started to decline and assisted in
19% 12% 11%
1 500 taking AMSA’s market share
10% back above 70% in H2 2017
1 000
70%
58%
57% 60% 60% 58% 63% 64%
66% 72%
• However, even though Chinese
5%
500 imports have reduced, imports
from other destinations are still
0 0%
2013 2014 2015 2016 2017
relatively high giving total
Other Imports Chinese Imports imports a market share greater
Domestic Competitors
Imports as a % of App Consumption
Amsa
than 20%

12 Financial results for the year ended 31 December 2017

The industry - domestic
SA flat steel ASC market share SA long steel ASC market share
100% 100%
8% 6% 4% 4% 6% 4% 9% 6% 11% 4%
13% 16% 15% 13% 15% 16% 11% 4% 3% 6% 4% 3%
21% 21% 16% 4% 10% 6% 8% 4%
11%
80% 11% 14% 15% 11% 80% 31% 19%
9% 11% 20% 20% 17% 33%
39% 28%
9% 7% 36% 39% 39% 29% 32%
9% 7% 1%
60% 5% 60%

40% 78% 40%

72% 68% 73%
61% 61% 64% 65% 59% 64% 62% 66% 58% 60%
53% 52% 54% 51% 56% 53%
20% 20%

0% 0%
2013 2014 2015 2016 2017 2013 2014 2015 2016 2017
AMSA Evraz Highveld AMSA Competitors
Chinese Imports Other Imports Chinese Imports Other Imports
• Imports reduced to 25% in 2017 from 30% in 2016 • AMSA regained lost market share in H2 2017
• AMSA local market share at 75% in 2017 (70% in 2016) • Highveld restart mitigated heavy section imports
• Finished product/downstream protection outstanding • Finished product imports remain a concern

Financial results for the year ended 31 December 2017 13

Operational review
Dean Subramanian
Flat steel division

Liquid steel output (kt) Product sales distribution (%)

2000 100%
1867 7% 8% 6% 6% 6% 7% 7% 6% 6% 5%
1809
1732 6% 8% 6% 8% 5% 4% 5% 6% 4% 5%
1800 1694 1719 1707
1649
7% 7% 10% 10% 10% 8% 7% 8%
1600 1535 80% 6% 10%
1489 8% 8%
1438 9% 10% 9% 10% 8%
9% 8% 10%
1400 11% 9%
14% 15% 14%
15% 16%
60% 17% 16% 15%
1200

1000
40%
800
65% 65%
56% 57% 54% 52% 59%
600 51% 55% 52%
20%
400

200
0%
0 2015 2016 2017
2013 2014 2015 2016 2017 HRC HDG CRC Plate Tin Other

16 Financial results for the year ended 31 December 2017

Long steel division

Liquid steel output (kt) Product sales distribution (%)

1000 946 100%
921 8% 10% 9% 12% 8% 7% 6% 7% 7% 7%
856 838 4% 4% 3% 3% 3% 3% 3% 3% 3%
3% 11% 12%
788 10% 12% 13%
800 762 80% 11% 13% 16% 18%
14%
725 727
667 18% 16%
23% 18% 17% 22% 19% 16%
60% 21% 21%
600
18% 19%
15% 19% 17% 20% 19%
16% 15% 18%
40%
400

265
20% 40% 39% 41% 39% 38% 43% 42%
200 34% 36% 37%

0%
0 2015 2016 2017
2013 2014 2015 2016 2017 Wire Rod Bars Sections Rebar Fencing Other

Financial results for the year ended 31 December 2017 17

Coke & Chemicals division

Commercial coke (kt) Commercial coke source of revenue %

350 336 2%
3% 1%
294 3%
300
256 9%
210 242 238
250
211 217 228
200 196 9%
200 181 178
157
150
9% 63%
94 100 90
100 92
86 89

50

0 FeCr Alloy Aluminium

2013 2014 2015 2016 2017 Other Timber Cement
Production Sales Plasticiser Petro Chemicals

• Although ferro alloy industry has been further consolidated, completion of battery repairs at Newcastle
Works should allow higher availability of ovens and hence increase in output
• Tar production remains sluggish stemming from low overall coke production

18 Financial results for the year ended 31 December 2017

Capital expenditure

FY2017 FY2016
Maintenance 1 098 1 518
Expansion 151 335
Environmental 41 38
Other 92 127
Total expenditure 1 382 2 018

Vdbp
R720m

Long
Saldanha AMSA products
R97m R1 382m R283m

C&C
R281m
Financial results for the year ended 31 December 2017 19
Financial review
Dean Subramanian
Headline earnings

FY 2017 FY 2016
Revenue 39 022 32 737
EBITDA (315) 190
Depreciation and amortisation (976) (1055)
Once-off items 71 (227)
Loss from operations (1 220) (1 092)
B-BBEE cost (870)
Impairment (2 604) (2 154)
Net finance costs (1 441) (700)
Equity earnings 139 129
Income tax expense (2) (19)
Loss after tax (5 128) (4 706)
Add back impairment 2 604 2 154
Add back disposal/scrapping of assets 8 (51)
Add back tax effect (2) 14
Headline loss (2 518) (2 589)
US$m (189) (176)

Financial results for the year ended 31 December 2017 21

Once-off items and impairments

Once-off items FY 2017 FY 2016

Competition Commission 30 30
Thabazimbi Mine closure costs 41 (275)
Unclaimed dividends 37
Derecognised payment in advance (19)
Total 71 (227)

Impairments FY 2017 FY 2016

Long steel products 1 007
Equity steel investments 10 11
Flat steel products 1 587 2 143
Total 2 604 2 154

22 Financial results for the year ended 31 December 2017

Divisional EBITDA

FY2017 FY2016 H2 2017 H1 2017

Flat steel products (Rm) 264 (392) 333 (69)

EBITDA margin 0.9% (1.8%) 2.3% (0.5%)

Net realised price R/t 8 581 7 344 8 746 8 413

Long steel products (Rm) (945) 286 (239) (706)

EBITDA margin (8.0%) 2.7% (3.8%) (13.0%)

Net realised price R/t 7 760 7 154 8 046 7 492

Coke and Chemicals (Rm) 365 172 174 191

EBITDA margin 26.0% 12.5% 26.0% 26.0%

Corporate and other (Rm) 1 124 (49) 50

Total EBITDA (Rm) (315) 190 219 (534) Q1 Q2 Q3 Q4

EBITDA margin (0.8%) 0.6% 1.1% (2.8%)

Financial results for the year ended 31 December 2017 23

24
2016

190
Exchange rate
impact

2 026
Sales volume

158
Sales price & mix
7 606

Raw material prices 5 318

EBITDA bridge (Rm)

Efficiencies &
667

other variable cost

Financial results for the year ended 31 December 2017

NRV provision
168

Other
90

2017
315
Cost dynamics and breakdown

FY 2017 FY 2016
Weight
(R/t) (R/t)
49.1% Raw materials 3 818 2 779
F 29.5% Auxiliaries & consumables 2 289 2 221
l 21.4% Fixed costs 1 663 1 628
a 100.0% Total 7 770 6 628
t Liquid steel (kt) 3 459 3 221
Average ZAR rate 13.32 14.72
Average NRP 8 581 7 344
51.5% Raw materials 3 671 3 002
L 22.7% Auxiliaries & consumables 1 619 1 563
o 25.8% Fixed costs 1 836 1 754
n 100.0% Total 7 126 6 319
g Liquid steel (kt) 1 452 1 550
Average ZAR rate 13.32 14.72
Average NRP 7 760 7 154
Financial results for the year ended 31 December 2017 25
Cash flow and analysis (Rm)
FY 2017 FY 2016
Cash (utilised)/generated before WC (613) 215
Working capital (99) 658
Capital expenditure (1 324) (2 008)
Net finance costs (667) (451)
Investments (11) (11)
Tax 80 (2)
B-BBEE Cost (55)
Transaction cost on BBF (61)
Proceeds on scrapping of assets 13 67
Realised forex (210) (268)
Finance lease (70) (62)
Cash settlement on management shares (9)
Increase/(decrease) of borrowings 4 450 (3 079)
Rights issue funds 4 500
Cash flow 1 479 (496)
Effect of forex rate change on cash (1) (8)
Net cash flow 1 478 (504)
Cash in bank 3 138 1 660
Short term loans (6 400) (1 950)
Net (borrowings)/cash (3 262) (290)
26 Financial results for the year ended 31 December 2017
Working capital movement and analysis (Rm)

FY 2017 FY 2016
Inventories (353) (1 830)

Finished products 198 (300)

Work-in-progress (397) (533)
Raw materials (134) (904)
Plant spares and stores (20) (93)
Receivables (1 207) (164)
Payables 1 538 2 958
Utilisation of provisions (77) (306)
Working capital movement (99) 658

Financial results for the year ended 31 December 2017 27

Consolidated statement of financial
position (Rm)
FY 2017 FY 2016
Current assets 18 131 14 812
Cash balance 3 138 1 660
Inventories 11 519 11 274
Trade & other receivables 2 988 1 774
Other current assets 486 104
Non-current assets 13 065 15 834
Property, plant & equipment 8 474 10 670
Equity accounted investments 4 424 4 667
Other non-current assets 167 497
Total assets 31 196 30 646
Liabilities 23 138 17 103
Current liabilities 13 646 11 823
Non-current liabilities 3 092 3 330
Borrowings 6 400 1 950
Shareholders equity 8 058 13 543
Total liabilities & equity 31 196 30 646

28 Financial results for the year ended 31 December 2017

Net debt and liquidity (Rm)

Cash flow and net debt/(cash) per half year Liquidity (undrawn facilities plus cash) per half year
5000
5000 -10%
-6%

4000 2% 0%

2000
3000 12% 10%
1010

-290 21%
2015 2016 2017 2000 23% 20%
-1000

-2522 1000 33% 30%

-2577
-2865
-3262
4065 2164 4660 3660 4873 3938
-4000 0 40%
Operating activities Working capital 2015 2016 2017
Capex/Investments Rights Issue
Net debt/(cash) Liquidity (Rm) Net debt to equity (%)

Financial results for the year ended 31 December 2017 29

 Outlook
Kobus Verster, Chief Executive Officer designate
2018 initiatives
2018
• Operational stability
Short term
• Productivity improvements
• Cost reduction
• Balance sheet optimisation
• Improve raw material mix
Procurement
• Targeted cost savings
• Rail and electricity costs
• Close productivity gap
Footprint
• Improve technical skills
• Improve cost
competitiveness
• Increase local market share • Volumetric discounts, item extras, payment terms
Commercial
• Improve AoL & rest of Africa
• Optimise pricing strategy;
ensure compliance with fair • Pursue value added products (heavy section, rail)
pricing principles
What is to be done
• Improve reliability and liquid steel output
• Target Group benchmark on key KPI’s
• Reduce fuel rates, optimise coal blends and
minimize non-prime output
• Stock reduction and asset disposal
• Briquetting of fine DRI
• Increase scrap consumption
• Internal coke transfers to avoid imports
• Continue to convert road to rail transport
• Develop rail dispatches to AOL customers
• Closure of batch annealing
• Debottleneck pickling line and temper mill
• Implement coating strategy
and apply contract and project pricing
• Implement larger coil sizes
Financial results for the year ended 31 December 2017 31
Outlook H1 2018

Steel markets
• International steel demand expected to remain strong
• Domestic steel demand is likely to remain subdued due to low economic
growth and a lack of infrastructure spend
• However, local sales volume are expected to increase replacing gap
created by lower imports
• Export sales anticipated to increase as a result of higher prices and demand
• Expect improvement in long steel volumes
• Volatility in the rand/US dollar exchange rate will continue to have a material
impact on the financial results

32 Financial results for the year ended 31 December 2017

Questions