ArcelorMittal, the world's largest steelmaker, returned to profit in the third quarter and forecast a modest improvement in the final three months of the year.
The company said on Wednesday that it turned a net profit of $903 mn, albeit due to an income tax benefit, after three straight loss-making quarters in which it suffered a near-collapse in the construction, machinery and car markets.
Chief executive Lakshmi Mittal said the company had seen the first signs of recovery in July-September, with production set to rise to about 70% of capacity in the fourth quarter.
"We should continue to see further gradual improvement through 2010, although the operating environment remains challenging," he said in a statement.
The company's much-watched core profit, earnings before interest, tax, depreciation and amortisation, totalled $1.59 bn in the third quarter, down 81% year-on-year but up 30% from the second quarter.
The company had previously given a forecast range of $1.4 bn to $1.8 bn. The average figure given in a Reuters poll of 12 analysts was $1.67 bn.
For the fourth quarter ArcelorMittal said it expected EBITDA of $2 bn to $2.4 bn.
By then output will have risen and lower raw materials prices should have a stronger impact.
Analysts had tended to be looking for guidance of around $2.5 bn, with a range from about $2 bn to $3 bn.
"You have seen steel prices coming down. I would have said below $2 bn would have been weak. It's not bullish, but it's consistent with what you should realistically expect," said Petercam analyst Alexandre Weinberg.
Dirk Nettling, an analyst at Commerzbank in Frankfurt, described the guidance as "at the lower end, but within the range".
ArcelorMittal, with output some three times greater than nearest rival Nippon Steel and nearly 8% of the global market, has said it does not expect markets to normalise in Europe and the United States in 2010.
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