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Profits, outlook beam at steelmaker ArcelorMittal

Rising prices and sales boosted profits at the world’s top steelmaker ArcelorMittal, which said Wednesday that it sees global demand continuing to rise despite a spate of tariffs.

Second quarter net profit shot up 41 percent compared to the same period last year to $1.9 billion (1.6 billion euros), while sales climbed 16 percent to $20 billion.

The results — sales, net profit, operating profit — all beat the consensus expectation of analysts surveyed by Bloomberg.

“The outlook for the second half of the year is encouraging as we anticipate current favourable market conditions continuing and are well positioned to capitalise on this from our leadership position across many key markets,” said ArcelorMital’s chief executive Lakshmi Mittal in the company’s earnings statement.

The firm even raised its forecast for global steel demand this year to an annual increase of 2.0 to 3.0 percent, although the United States and European Union have both slapped down tariffs on certain imports of steel.

The earnings statement makes no mention of the tariffs, which some manufacturing firms have already warned could crimp their profits if their input costs continue to rise, and have raised the threat of a wider trade war that could stunt global growth.

But with production facilities in both Europe and the United States, as well as elsewhere, ArcelorMittal may be in a better position than rivals to dodge the impact of the tariffs while benefitting from increasing steel prices.

“We have a strong US exposure, clearly we are a net beneficiary of the trade actions,” chief financial officer Aditya Mittal was quoted as saying by Bloomberg News.

The tariffs hit in particular imports from China, which had been flooding the global market with low-priced steel.

“We don’t believe tariffs are impacting the level of trade that takes global GDP to negative territory,” added Aditya Mittal.

ArcelorMittal shares were up 1.0 percent in midday trading in Amsterdam.