(May 2): ArcelorMittal SA, the world’s biggest steelmaker outside of China, remains positive on the medium to long-term outlook for demand after first-quarter (1Q) earnings beat estimates.

The company kept its forecast for apparent consumption of steel outside of China — a key barometer of the world economy — unchanged from three months ago.

“Although overall economic sentiment remains subdued, we expect apparent steel demand ex-China to grow between +3% and +4% this year and are well-positioned to benefit from this improvement,” chief executive officer Aditya Mittal said in a statement on Thursday.

ArcelorMittal said it’s positioned for a recovery in demand after margins across the steel sector were squeezed last year. The global market was hampered as the manufacturing and construction sectors languished in the face of China’s rolling property crisis and weak growth in many of the world’s biggest economies.

Average steel selling prices rose 4.8% from the fourth quarter of last year, ArcelorMittal said.

“The improved pricing environment combined with recovering volumes resulted in sequentially stronger quarterly results,” the CEO said.

The company reported 1Q earnings before interest, taxes, depreciation and amortisation of US$1.96 billion (RM9.34 billion), compared with an analyst consensus of US$1.71 billion.

That will be a welcome relief for ArcelorMittal after a bruising 12 months. The company was forced to sell its Kazakhstan business last year after a catastrophic mining disaster killed 46 workers and in February, the steelmaker saw its Italian business seized by the country’s government.

ArcelorMittal shares rose as much as 2.2% in Amsterdam.

“ArcelorMittal’s 1Q Ebitda beat company-compiled consensus by 8%, but soft steel prices and a cautious outlook statement that refers to subdued market sentiment may temper investor optimism. That’s even as expectations for apparent steel demand ex-China this year are unchanged. The sharp correction in steel prices on both sides of the Atlantic since mid-1Q doesn’t bode well for 2Q earnings,” said Bloomberg Intelligence metals and mining analyst Alon Olsha.