Mittal Steel post massive drops in profits

Mittal Steel post massive drops in profits

World’s largest Steel Company Mittal Steel is trying hard to work out some kind of an acquisition deal with the Arcelor SA, which is the second largest player in the market. However, the company had some bad news for the market as they have just posted a 58 percent decline in fourth-quarter profit on higher costs and lower prices.

The company also said that a turnaround on dropping profits is unlikely to come in the near future. The company also posted that net income dropped to $650 million, or 92 cents a share, from $1.55 billion, or $2.42, a year earlier.

Chief Financial Officer Aditya Mittal said in a statement on this event: “It’s a difficult pricing environment. We need consolidation to build a more sustainable steel industry.” The company also suffered a dropped share price in the stock markets.

Company’s top head Lakshmi Mittal added in a statement: “Overall average selling prices are expected to remain flat, and cost of sales are expected to increase. We expect operating income to be higher as compared to the fourth quarter of 2005.”