Arcelor Mittal Reports First Quarter 2007 Results

Regulatory News: Mittal Steel Company N.V. (referred to as "Arcelor Mittal”, "Mittal Steel” or "the Company”) (New York: MT; Amsterdam: MT; Madrid: MTS; Paris: MTP; Brussels: MTBL; Luxembourg: MT), the world’s largest and most global steel company, today announced results for the three months ended March 31, 2007. Q107 highlights: Strong results above guidance Q107 EBITDA of $4.3 billion – higher than guidance due to accelerated synergy generation $2.7 billion cash provided by operating activities in Q107 and strong net debt reduction in Q107 of $1.7 billion over Q406 Integration going well - on track to deliver synergies as planned – synergies of $573 million captured Q107 highlights (on the basis of IFRS, amounts in US$ and Euros1 ): (US dollars in millions except earnings per share and shipments data)       Results   US Dollars   Q1 2007 Actual   Q4 2006 Pro forma   Q1 2006 Pro forma Shipments (Million MT)2   27.0    26.7    27.9  Sales   24,476    23,203    20,874  EBITDA3   4,346    4,118    3,300  Operating income   3,455    3,243    2,504  Net income   2,250    2,371    1,603  Basic earnings per share   $1.62    $1.71    $1.16  (Euros in millions except earnings per share and shipments data)       Results   Euros1   Q1 2007 Actual   Q4 2006 Pro forma   Q1 2006 Pro forma Shipments (Million MT)2   27.0    26.7    27.9  Sales   18,675    17,997    17,357  EBITDA3   3,316    3,194    2,744  Operating income   2,636    2,515    2,082  Net income   1,717    1,839    1,333  Basic earnings per share   €1.24    €1.33    €0.96  1. US dollars have been translated into Euros using an average exchange rate (US$/Euro) of 1.3106, 1.2893 and 1.2026 for Q1 2007, Q4 2006 and Q1 2006, respectively. 2. Some inter-company shipments are not eliminated. 3. EBITDA is defined as operating income plus depreciation. Inter-company transactions have been eliminated in consolidation. The financial information in this press release and Appendix 1 has been prepared based on International Financial Reporting Standards as endorsed by the European Union ("IFRS”). While the financial information included in this announcement has been prepared in accordance with IFRS applicable to interim periods, this announcement does not contain sufficient information to constitute an interim financial report as defined in IAS 34, Interim Financial Reporting. Unless otherwise noted the numbers in this press release have not been audited. Commenting, Lakshmi N. Mittal, President and CEO, Arcelor Mittal, said: "Arcelor Mittal has delivered a strong set of numbers for the first quarter with EBITDA of US$4.3 billion, higher than guidance. These results reflect the strength of Arcelor Mittal’s global business model and the continuing strong demand for steel generally. The benefits of combining Arcelor and Mittal Steel continue to outperform our expectations and we are on track to deliver synergies as planned. Looking forward, we expect EBITDA in the second quarter to be higher than in the first, largely due to improved performance in Flat Carbon Americas, Long Carbon and AACIS. Our unique geographic and product diversification ideally positions us to continue to deliver consistent results against the current positive underlying dynamics.” FIRST QUARTER 2007 NEWS CONFERENCE   Arcelor Mittal management will host a news conference:   Date: Wednesday, May 16th 2007 Time: 6.00 am New York Time / 11.00 am London Time / 12.00 pm CET   The dial in number: International number: +44 207 0705 579 UK: 0207 0705 579 USA: +1 866 432 7186   Replay Numbers: International number: +44 208 196 1998 UK: 0208 196 1998 USA: +1 866 5831035   Access Code for each language on the replay: English 069434 Spanish 181439 French 414790   The news conference will be available via a live video webcast on www.arcelormittal.com. It will take place in Luxembourg, 19, avenue de la Liberte.     FIRST QUARTER 2007 EARNINGS ANALYST CONFERENCE CALL   Additionally, Arcelor Mittal management will host a conference call for members of the investment community to discuss the first quarter 2007 financial performance of Arcelor Mittal at 9.30am New York time / 2.30pm London time / 3.30pm CET on Wednesday, May 16th 2007. The conference call will include a brief question and answer session with senior management. The conference call information is as follows:   Dial in access numbers will be the following:   International: +44 208 3222 638 UK: 0208 3222 638 USA: +1 866 432 7175   A replay of the conference call will be available for one week by dialing (access code 634819):   International: +44 208 196 1998 UK: 0208 196 1998 USA: +1 866 443 7118   The presentation will be available via a live video webcast on www.arcelormittal.com Forward-Looking Statements This document may contain forward-looking information and statements about Mittal Steel Company N.V. including Arcelor S.A. These statements include financial projections and estimates and their underlying assumptions, statements regarding plans, objectives and expectations with respect to future operations, products and services, and statements regarding future performance. Forward-looking statements may be identified by the words "believe,” "expect,” "anticipate,” "target” or similar expressions. Although Arcelor Mittal’s management believes that the expectations reflected in such forward-looking statements are reasonable, investors and holders of Arcelor Mittal’s securities are cautioned that forward-looking information and statements are subject to numerous risks and uncertainties, many of which are difficult to predict and generally beyond the control of Arcelor Mittal, 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. These risks and uncertainties include those discussed or identified in the filings with the Netherlands Authority for the Financial Markets and the Securities and Exchange Commission ("SEC”) made or to be made by Arcelor Mittal including Mittal Steel’s Annual Report on Form 20-F filed with the SEC. Arcelor Mittal undertakes no obligation to publicly update its forward-looking statements, whether as a result of new information, future events, or otherwise. Important Information This document constitutes neither an offer to acquire Arcelor Brasil S.A. securities nor an offer of securities in any jurisdiction. In particular, this document does not constitute an offer of securities for distribution or sale in the United States. Securities may not be offered, sold or distributed in the United States absent registration or an exemption from registration under the U.S. Securities Act of 1933. Arcelor Mittal does not intend to register securities or conduct a public offering in the United States. The offer to acquire shares in Arcelor Brasil S.A. (the "Offer”) will be made to all holders of shares of Arcelor Brasil S.A. located in Brazil. In addition, holders of shares of Arcelor Brasil S.A. located outside of Brazil will only be allowed to participate in the Offer if such holders are permitted to do so under the laws and regulations of the jurisdiction in which they are located. Additional Information In connection with the proposed merger of Mittal Steel Company N.V. ("Mittal Steel") with ArcelorMittal (a wholly owned subsidiary of Mittal Steel), and the subsequent merger of ArcelorMittal with Arcelor, Mittal Steel, ArcelorMittal and Arcelor will file important documents with the relevant securities regulatory authorities, including the filing with the U.S. Securities and Exchange Commission of registration statements that will each include a proxy statement/prospectus. Each proxy statement/prospectus will contain important information about the relevant merger and related matters, and Mittal Steel, ArcelorMittal and Arcelor will make public such proxy statement/prospectus and mail the proxy statement/prospectus to the relevant U.S. shareholders. Investors and security holders are urged to read each proxy statement/prospectus, and any other relevant documents filed with the relevant securities regulatory authorities, when they become available and before making any investment decision. You will be able to obtain a free copy of each proxy statement/prospectus (when available) and other related documents filed with the SEC by Mittal Steel, ArcelorMittal and Arcelor at the SEC’s web site at www.sec.gov and from Mittal Steel, ArcelorMittal and Arcelor at www.arcelormittal.com. ARCELOR MITTAL FIRST QUARTER 2007 RESULTS – PRO FORMA COMPARISON Arcelor Mittal, the world’s largest and most global steel company, today announced results for the three months ended March 31, 2007. Pro-forma presentation The pro forma results for 2006 include the results of the following acquisitions as if such acquisitions took place on January 1, 2006: the acquisition of Arcelor on August 1, 2006; and the acquisition of certain subsidiaries of Stelco on January 30, 2006. Furthermore, the results of Arcelor include the following significant acquisitions as if such acquisitions took place on January 1, 2006: the acquisition of Sonasid on June 1, 2006; and the acquisition of Dofasco on March 1, 2006. Results for the three months ended March 31, 2007 versus pro forma results for the three months ended December 31, 2006 and three months ended March 31, 2006 Arcelor Mittal net income for the three months ended March 31, 2007, was $2.3 billion, or $1.62 per share, as compared with pro forma net income of $2.4 billion, or $1.71 per share, for the three months ended December 31, 2006, and $1.6 billion, or $1.16 per share, for the three months ended March 31, 2006. Sales and operating income for the three months ended March 31, 2007, were $24.5 billion and $3.5 billion, respectively, as compared with sales and pro forma operating income of $23.2 billion and $3.2 billion, respectively, for the three months ended December 31, 2006. Pro forma sales and operating income for the three months ended March 31, 2006, were $20.9 billion and $2.5 billion, respectively. Total steel shipments for the three months ended March 31, 2007, were 27.0 million metric tonnes as compared with steel shipments of 26.7 million metric tonnes for the three months ended December 31, 2006 and pro forma steel shipments of 27.9 million metric tonnes for the three months ended March 31, 2006. Depreciation for the three months ended March 31, 2007, increased to $891 million as compared with pro forma depreciation of $875 million for the three months ended December 31, 2006 and $796 million for the three months ended March 31, 2006. Income from equity method investments for the three months ended March 31, 2007, was $154 million as compared with pro forma income from equity method investments of $163 million for the three months ended December 31, 2006 and $110 million for the three months ended March 31, 2006. Net financing costs for the three months ended March 31, 2007, were $10 million as compared with pro forma income of $4 million for the three months ended December 31, 2006 and pro forma expense of $681 million for the three months ended March 31, 2006. Pro forma net financing costs for the three months ended December 31, 2006, primarily included a gain relating to a Canadian Dollar swap, foreign exchange, certain financial instruments partly offset by the conversion cost of Arcelor OCEANEs (convertible bonds). Net financing costs for the three months ended March 31, 2007, primarily include gains relating to certain financial instruments, foreign exchange and a gain relating to a Canadian dollar swap. Income tax expense for the three months ended March 31, 2007, increased to $934 million as compared with pro forma tax expense of $642 million for the three months ended December 31, 2006. The effective tax rate for the three months ended March 31, 2007, was 25.8% as compared with 18.6% for the three months ended December 31, 2006. The pro forma income tax expense for the three months ended December 31, 2006, included the tax benefit of the utilization of certain net operating losses. The pro forma income tax expense for the three months ended March 31, 2006 was $33 million, with an effective tax rate of 1.7%. Minority interest for the three months ended March 31, 2007, was $436 million as compared with pro forma minority interest of $443 million for the three months ended December 31, 2006 and $305 million for the three months ended March 31, 2006. Analysis of operations Q107 v Q406 pro forma1 Flat Carbon Americas Total steel shipments in the Flat Carbon Americas segment were lower at 6.6 million metric tonnes for the three months ended March 31, 2007, as compared with steel shipments of 6.7 million metric tonnes for the three months ended December 31, 2006. Sales were flat at $5.1 billion for the three months ended March 31, 2007, as compared with sales for the three months ended December 31, 2006. Operating income was $584 million for the three months ended March 31, 2007, as compared with pro forma operating income of $632 million for the three months ended December 31, 2006. Operating results for the three months ended March 31, 2007, as compared with the three months ended December 31, 2006, were impacted primarily by lower shipments due to weaker market demand. Average steel selling prices were flat. Flat Carbon Europe Total steel shipments in the Flat Carbon Europe segment were higher at 8.7 million metric tonnes for the three months ended March 31, 2007, as compared with steel shipments of 8.4 million metric tonnes for the three months ended December 31, 2006. Sales were higher at $8.2 billion for the three months ended March 31, 2007, as compared with sales of $7.6 billion for the three months ended December 31, 2006. Operating income increased to $1.1 billion for the three months ended March 31, 2007, as compared with pro forma operating income of $755 million for the three months ended December 31, 2006. Operating results for the three months ended March 31, 2007, as compared to the three months ended December 31, 2006, increased due to improved volumes and average steel selling prices, which were offset partly by higher input costs. Long Carbon Americas and Europe Total steel shipments in the Long Carbon Americas and Europe segment were marginally higher at 6.2 million metric tonnes for the three months ended March 31, 2007, as compared with steel shipments of 6.1 million metric tonnes for the three months ended December 31, 2006. Sales were higher at $5.5 billion for the three months ended March 31, 2007, as compared with sales of $5.0 billion for the three months ended December 31, 2006. Operating income was higher at $947 million for the three months ended March 31, 2007, as compared with pro forma operating income of $879 million for the three months ended December 31, 2006. Operating results for the three months ended March 31, 2007, as compared with the three months ended December 31, 2006, increased due to slightly higher volumes and average steel selling prices. Asia Africa and CIS ("AACIS”) Total steel shipments in the AACIS segment were higher at 5.1 million metric tonnes for the three months ended March 31, 2007, as compared with steel shipments of 4.9 million metric tonnes for the three months ended December 31, 2006. Sales were higher at $4.0 billion for the three months ended March 31, 2007, as compared with sales of $3.8 billion for the three months ended December 31, 2006. Operating income was marginally higher at $744 million for the three months ended March 31, 2007, as compared with pro forma operating income of $727 million for the three months ended December 31, 2006. Operating results for three months ended March 31, 2007, as compared to the three months ended December 31, 2006, increased due to higher volumes and average steel selling prices, which were partly offset by higher input costs. Stainless Steel Total steel shipments in the Stainless Steel segment were lower at 498 thousand metric tonnes for the three months ended March 31, 2007, as compared with steel shipments of 543 thousand metric tonnes for the three months ended December 31, 2006. Sales were higher at $2.3 billion for the three months ended March 31, 2007, as compared with sales of $2.2 billion for the three months ended December 31, 2006. Operating income was higher at $373 million for the three months ended March 31, 2007, as compared with pro forma operating income of $344 million for the three months ended December 31, 2006. Operating results for the Stainless Steel segment improved for the three months ended March 31, 2007, as compared to the three months ended December 31, 2006, primarily due to higher average steel selling prices driven by a steep increase in nickel prices, offset in part by increased input costs and lower volumes. AM3S2 Total steel shipments in the AM3S segment were higher at 3.8 million metric tonnes in the three months ended March 31, 2007, as compared with steel shipments of 3.7 million metric tonnes for the three months ended December 31, 2006. Sales in the AM3S segment were higher at $3.4 billion for the three months ended March 31, 2007, as compared with sales of $3.3 billion for the three months ended December 31, 2006. Operating income decreased marginally to $121 million for the three months ended March 31, 2007, as compared with pro forma operating income of $128 million for three months ended December 31, 2006. Liquidity and Capital Resources Arcelor Mittal's principal sources of liquidity are cash generated from its operations, its credit lines at the corporate level and various working capital credit lines at its operating subsidiaries. As of March 31, 2007, the Company’s cash and cash equivalents, including restricted cash and short-term investments, amounted to $8.3 billion as compared to $6.1 billion at December 31, 2006. Net debt, which includes long-term debt plus short-term debt less cash and cash equivalents, restricted cash and short-term investments, was reduced by $1.7 billion to $18.8 billion as compared to December 31, 2006. In addition, the Company, including its operating subsidiaries, had available borrowing capacity of $9.6 billion at March 31, 2007, as compared with $9.0 billion at December 31, 2006. Changes in working capital resulted in the use of cash during the three months ended March 31, 2007, of $653 million compared to cash generated from changes in working capital of $1.0 billion for the three months ended December 31, 2006. For the three months ended March 31, 2007, net cash provided by operating activities was $2.7 billion, as compared with $4.3 billion for the three months ended December 31, 2006. On February 2, 2007, Arcelor Mittal declared an interim dividend of $0.325 per share. The cash dividend was paid on March 15, 2007 to Euronext Amsterdam, Euronext Brussels, Euronext Paris, Luxembourg Stock Exchange and Spanish Exchange shareholders of record on February 27, 2007, and to New York Stock Exchange shareholders of record on March 2, 2007. Capital expenditures during the three months ended March 31, 2007, were $988 million as compared with $1.6 billion for the three months ended December 31, 2006. On April 27, 2007, Standard & Poor’s Ratings Services revised its outlook on Arcelor Mittal to positive from stable. At the same time, the "BBB” long-term corporate credit rating on Arcelor Mittal was affirmed. Recent Developments On April 20, 2007, Arcelor Mittal finalized the acquisition of Sicartsa, a Mexican integrated steel producer, from Grupo Villacero, for an enterprise value of $1.4 billion, following all required approvals of the transaction, including by US and Mexican competition authorities. On April 19, 2007, Arcelor Mittal employee representatives and management agreed on the principle of a new combined European Works Council (EWC). This new agreement replaces the EWC agreements that previously existed in both Mittal Steel Company N.V. and Arcelor S.A. prior to the merger and represents a major additional step in the integration process of Arcelor Mittal. The new Arcelor Mittal EWC will be representing over 130,000 employees within the European Union 27. On September 25, 2006, the Comissão de Valores Mobiliários (the "CVM”), the Brazilian securities regulator, ruled that, as a result of Arcelor Mittal’s acquisition of Arcelor, Arcelor Mittal was required to carry out a public offer to acquire all of the outstanding shares in Arcelor Brasil not owned by Arcelor or any other affiliate of Arcelor Mittal. Pursuant to the ruling, the value to be offered to Arcelor Brasil’s shareholders is to be determined on the basis of the value of the part of the overall consideration paid for Arcelor by Arcelor Mittal that was attributable to Arcelor Brasil. On April 17, 2007, the CVM granted registration of the offer, which opened on April 27, 2007 and will close on June 4, 2007. The consideration to be offered per Arcelor Brasil share is R$11.70 in cash and 0.3568 Arcelor Mittal class A common shares, subject to certain adjustments. As of April 26, 2007, the total value offered per Arcelor Brasil share would be €18.27 ($24.90). Tendering Arcelor Brasil shareholders may also accept an all-cash option, pursuant to which they would receive cash in an amount equal to the value of the cash and share consideration described above, calculated in the manner set forth in the offering documents. On the basis of the closing price for Arcelor Mittal’s shares on the New York Stock Exchange on April 26, 2007, the maximum amount of cash that may be paid by Arcelor Mittal will be approximately €3.8 billion ($5.3 billion) (assuming 100% acceptance of the cash option). The maximum number of Arcelor Mittal class A common shares that may be issued will be approximately 76 million shares, representing 5% of the share capital of Arcelor Mittal on a diluted basis (assuming 100% acceptance of the mixed consideration option). Outlook for Second Quarter 2007 The Company expects second quarter 2007 EBITDA to be higher than that in the first quarter3. The Company expects overall shipment levels to be higher than Q107 levels by approximately 3-5%. The profitability of the Flat Carbon Americas division is expected to improve. Long Carbon Americas and Europe profitability is expected to continue to improve due to strong market conditions. AACIS profitability is expected to improve due to increase in volumes. The profitability of the Flat Carbon Europe and AM3S division is expected to remain stable. The profitability of the Stainless Steel division is expected to decline. The Company expects an effective tax rate of approximately 25% for the year. 1 The 2006 segmental information has been reallocated to conform to the 2007 allocation. 2 The shipments for the AM3S segment, which are mainly inter-company, are not consolidated in the total shipments of the combined company and are eliminated. 3 No quantitative EBITDA guidance is provided due to the pending regulatory filings in connection with the Mittal Steel/Arcelor merger process. ARCELOR MITTAL UNAUDITED CONSOLIDATED BALANCE SHEETS   Balance sheets ACTUAL ACTUAL March 31, December 31, In millions of US dollars 2007    20061 ASSETS Current Assets Cash and cash equivalents, restricted cash and short-term investments $ 8,277  $ 6,146  Trade accounts receivable – net 10,318  8,769  Inventories 19,319  19,238  Prepaid expenses and other current assets 5,838    5,209  Total Current Assets 43,752    39,362    Goodwill and intangible assets 10,720  10,782  Property, plant and equipment 54,351  54,696  Investments in affiliates and joint ventures 4,058  3,492    Deferred tax assets 1,563  1,670  Other assets 2,340    2,164  Total Assets $116,784    $112,166    LIABILITIES AND SHAREHOLDERS’ EQUITY Current Liabilities Payable to banks and current portion of long-term debt $ 5,829  $ 4,922    Trade accounts payable 10,909  10,717  Accrued expenses and other current liabilities 10,061  8,921        Total Current Liabilities 26,799    24,560    Long-term debt, net of current portion 21,200  21,645  Deferred tax liabilities 7,419  7,274  Other long-term obligations and deferred employee benefits 8,182    8,496  Total Liabilities 63,600    61,975    Total Shareholders’ Equity 44,642  42,127  Minority Interest 8,542    8,064  Total Equity 53,184    50,191  Total Liabilities and Shareholders’ Equity   $116,784    $112,166  1. Amounts are derived from the Company’s audited financial statements for the year ended December 31, 2006 ARCELOR MITTAL UNAUDITED CONSOLIDATED STATEMENTS OF INCOME     Three Months Ended In millions of US dollars, except shares, per share, employee and shipment data   March 31, 2007   December 31, 2006   March 31, 2006     Actual   Pro forma   Pro forma STATEMENTS OF INCOME DATA   Sales $24,476  $23,203  $20,874  Depreciation 891  875  796  Operating Income 3,455  3,243  2,504  Operating Margin % 14.1% 14.0% 12.0%   Other income (expense) - net 21  46  8  Income from equity method investments 154  163  110  Financing costs - net   (10)   4    (681) Income before taxes and minority interest 3,620  3,456  1,941  Income tax expense   934    642    33  Income before minority interest   2,686    2,814    1,908  Minority interest   (436)   (443)   (305) Net income   $2,250    $2,371    $1,603    Basic earnings per common share $1.62  $1.71  $1.16  Diluted earnings per common share 1.62  1.71  1.16  Weighted average common shares outstanding (in millions)1 1,386  1,385  1,384  Diluted weighted average common shares outstanding (in millions) 1,388  1,387  1,386    EBITDA2 $4,346  $4,118  $3,300  EBITDA Margin % 17.8% 17.7% 15.8%   OTHER INFORMATION Total shipments of steel products3 (Million metric tonnes) 27.0  26.7  27.9  Employees (in thousands)   316    320    330  1. The information provided assumes that shares issued in connection with the acquisition of Arcelor were issued at the beginning of the period presented. 2. EBITDA is defined as operating income plus depreciation. 3. Some inter-company shipments are not eliminated. ARCELOR MITTAL UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS   In millions of US dollars Three Months Ended     March 31, 2007   December 31, 2006   March 31, 2006     Actual   Pro forma   Pro forma Operating activities: Net Income $2,250  $2,371  $1,603  Adjustments to reconcile net income to net cash provided by operations: Minority interests 436  443  305  Depreciation 891  875  796  Others (274) (456) (251) Changes in operating assets and liabilities, net of effects from acquisition   (653)   1,034    (1,143) Net cash provided by operating activities   2,650    4,267    1,310  Investing activities: Purchase of property, plant and equipment (988) (1,633) (937) Other investing activities (net)   862    (43)   (378) Net cash used in investing activities   (126)   (1,676)   (1,315) Financing activities: Proceeds (payments) from payable to banks and long-term debt 15  (2,292) 1,125  Dividends paid (514) (210) (185) Other financing activities (net)   46    (42)   (4) Net cash provided by (used) in financing activities   (453)   (2,544)   936  Net increase in cash and cash equivalents   2,071    47    931  Effect of exchange rate changes on cash   67    241    259  Change in cash and cash equivalents   $2,138    $288    $1,190  Appendix 1 - First Quarter 2007 Key financial and operational information   Amounts in millions of US dollars unless otherwise stated   Flat Carbon Americas   Flat Carbon Europe   Long Carbon Americas and Europe   AACIS   Stainless Steel   AM3S   Financial Information   Sales $5,107  $8,174  $5,488  $4,035  $2,331  $3,366    Depreciation 228  281  141  132  56  27    Operating income 584  1,072  947  744  373  121    Operating margin (as a percentage of sales) 11.4% 13.1% 17.3% 18.4% 16.0% 3.6%   EBITDA 812  1,353  1,088  876  429  148    EBITDA margin (as a percentage of sales) 15.9% 16.6% 19.8% 21.7% 18.4% 4.4%   Capital expenditure 318  314  181  105  36  25      Operational Information   Crude Steel Production (Thousand MT) 7,539  9,963  5,962  5,281  613  -    Steel Shipments (Thousand MT) 6,597  8,653  6,169  5,117  498  3,775    Employees   36,062    68,981    51,006    133,305    11,481    11,798  EBITDA is defined as operating income plus depreciation. Crude steel production is a combination of crude steel at the former Arcelor units and liquid steel at the former Mittal Steel units Some inter segment and intra segment sales have not been eliminated. Some inter-company shipments have not been eliminated. AM3S shipments are not consolidated. The 2006 segmental information has been reallocated to conform to the 2007 allocation. Appendix 2 - Quarter 1 2007   Shipment by geographical location       Amounts in thousand tonnes   Shipments FCA:   6,597  North America1 5,404  South America   1,193  FCE:   8,653  Europe   8,653  LC:   6,169  North America 763  South America 1,259  Europe   4,147  AACIS:   5,117  Africa 2,107  Asia, CIS & Other   3,010  Stainless Steel:   498  1 Includes shipments from Mexico Some inter-company shipments have not been eliminated. AM3S shipments are not consolidated in group total MITTAL STEEL COMPANY N.V. FIRST QUARTER 2007 RESULTS May 16, 2007 – Mittal Steel Company N.V. (referred to as "Arcelor Mittal”, "Mittal Steel” or "the Company”) (New York: MT; Amsterdam: MT; Madrid: MTS; Paris: MTP; Brussels: MTBL; Luxembourg: MT), the world’s largest and most global steel company, today announced results for the three months ended March 31, 2007. Q107 Highlights: Strong results above guidance EPS has increased by 86% over Q106 $2.7 billion cash provided by operating activities in Q107 and strong net debt reduction in Q107 of $1.7 billion over Q406 Integration going well - on track to deliver synergies as planned – synergies of $573 million captured Q107 Highlights (on the basis of IFRS, amounts in US$ and Euros1): (US dollars in millions except earnings per share and shipments data)     Results US Dollars   Q1 2007   Q4 2006   Q1 2006 Shipments (million MT)2   27.0    26.7    14.1  Sales   24,476    23,203    8,430  EBITDA3   4,346    3,495    1,309  Operating income   3,455    2,630    952  Net income   2,250    1,917    610  Basic earnings per share   $1.62    $1.38    $0.87  (Euros in millions except earnings per share and shipments data)     Results Euros1   Q1 2007   Q4 2006   Q1 2006 Shipments (million MT)2   27.0    26.7    14.1  Sales   18,675    17,997    7,010  EBITDA 3   3,316    2,711    1,088  Operating income   2,636    2,040    792  Net income   1,717    1,487    507  Basic earnings per share   €1.24    €1.07    €0.72  1. US dollars have been translated into Euros using an average exchange rate (US$/Euro) of 1.3106, 1.2893 and 1.2026 for Q1 2007, Q4 2006 and Q1 2006, respectively. 2. Some inter-company shipments are not eliminated. 3. EBITDA is defined as operating income plus depreciation. Inter-company transactions have been eliminated in consolidation. The financial information in this press release and Appendix 1 has been prepared based on International Financial Reporting Standards as endorsed by the European Union ("IFRS”). While the financial information included in this announcement has been prepared in accordance with IFRS applicable to interim periods, this announcement does not contain sufficient information to constitute an interim financial report as defined in IAS 34, Interim Financial Reporting. Unless otherwise noted the numbers in this press release have not been audited. MITTAL STEEL COMPANY N.V. FIRST QUARTER 2007 RESULTS Net income for the three months ended March 31, 2007, was $2.3 billion, or $1.62 per share, as compared with net income of $1.9 billion, or $1.38 per share, for the three months ended December 31, 2006. Consolidated sales and operating income for the three months ended March 31, 2007, were $24.5 billion and $3.5 billion, respectively, as compared with $23.2 billion and $2.6 billion, respectively, for the three months ended December 31, 2006. Total steel shipments for the three months ended March 31, 2007, were 27.0 million metric tonnes as compared with 26.7 million metric tonnes for the three months ended December 31, 2006. Analysis of operations for Q107 v Q106 During 2006, the Company’s operations have undergone major changes, primarily following the merger with Arcelor which has been consolidated from August 1, 2006, and therefore, the Q107 and Q106 results are not comparable. Sales for the three months ended March 31, 2007, were $24.5 billion as compared with $8.4 billion for the three months ended March 31, 2006. Depreciation for the three months ended March 31, 2007, was $891 million as compared with $357 million for the three months ended March 31, 2006. Operating income for the three months ended March 31, 2007, increased to $3.5 billion as compared with $952 million for the three months ended March 31, 2006. Income from equity method investments for the three months ended March 31, 2007, was $154 million as compared with $25 million for the three months ended March 31, 2006. Net financing cost for the three months ended March 31, 2007, was $10 million as compared with $175 million for the three months ended March 31, 2006. Income tax expense for the three months ended March 31, 2007, was $934 million as compared with $117 million for the three months ended March 31, 2006. The effective tax rate for the three months ended March 31, 2007, was 25.8% as compared with 14.5% for the three months ended March 31, 2006. Net income for the three months ended March 31, 2007, was $2.3 billion as compared with $610 million for the three months ended March 31, 2006. Analysis of operations for Q107 v Q406 Sales for the three months ended March 31, 2007, were $24.5 billion as compared with $23.2 billion for the three months ended December 31, 2006. Depreciation for the three months ended March 31, 2007, was $891 million as compared with $865 million for the three months ended December 31, 2006. Operating income for the three months ended March 31, 2007, increased to $3.5 billion as compared with $2.6 billion for the three months ended December 31, 2006. Income from equity method investments for the three months ended March 31, 2007, was $154 million as compared with $163 million for the three months ended December 31, 2006. Net financing cost for the three months ended March 31, 2007, was $10 million as compared with $179 million for the three months ended December 31, 2006. Income tax expense for the three months ended March 31, 2007, was $934 million as compared with $377 million for the three months ended December 31, 2006. The effective tax rate for the three months ended March 31, 2007, was 25.8% as compared with 14.2% for the three months ended December 31, 2006. Minority interest during the three months ended March 31, 2007, was $436 million as compared with $366 million for the three months ended December 31, 2006. Net income for the three months ended March 31, 2007, increased to $2.3 billion as compared with $1.9 billion for the three months ended December 31, 2006. Liquidity and Capital Resources Arcelor Mittal's principal sources of liquidity are cash generated from its operations, its credit lines at the corporate level and various working capital credit lines at its operating subsidiaries. As of March 31, 2007, the Company’s cash and cash equivalents, including restricted cash and short-term investments, amounted to $8.3 billion as compared with $6.1 billion at December 31, 2006. Net debt, which includes long-term debt plus short-term debt less cash and cash equivalents, restricted cash and short-term investments, was reduced by $1.7 billion to $18.8 billion as compared to December 31, 2006. In addition, the Company, including its operating subsidiaries, had available borrowing capacity of $9.6 billion at March 31, 2007, as compared with $9.0 billion at December 31, 2006. Changes in working capital resulted in the use of cash during the three months ended March 31, 2007 of $653 million compared to cash generated from changes in working capital of $1.9 billion for the three months ended December 31, 2006. For the three months ended March 31, 2007, net cash provided by operating activities was $2.7 billion, as compared with $4.3 billion for the three months ended December 31, 2006. On February 2, 2007, Arcelor Mittal declared an interim dividend of $0.325 per share. The cash dividend was paid on March 15, 2007 to Euronext Amsterdam, Euronext Brussels, Euronext Paris, Luxembourg Stock Exchange and Spanish Exchange shareholders of record on February 27, 2007, and to New York Stock Exchange shareholders of record on March 2, 2007. Capital expenditures during the three months ended March 31, 2007, were $988 million as compared with $1.6 billion for the three months ended December 31, 2006. On April 27, 2007, Standard & Poor’s Ratings Services revised its outlook on Arcelor Mittal to positive from stable. At the same time, the "BBB” long-term corporate credit rating on Arcelor Mittal was affirmed. Recent Developments On April 20, 2007, Arcelor Mittal finalized the acquisition of Sicartsa, a Mexican integrated steel producer, from Grupo Villacero, for an enterprise value of $1.4 billion, following all required approvals of the transaction, including by US and Mexican competition authorities. On April 19, 2007, Arcelor Mittal employee representatives and management agreed on the principle of a new combined European Works Council (EWC). This new agreement replaces the EWC agreements that previously existed in both Mittal Steel Company N.V. and Arcelor S.A. prior to the merger and represents a major additional step in the integration process of Arcelor Mittal. The new Arcelor Mittal EWC will be representing over 130,000 employees within the European Union 27. On September 25, 2006, the Comissão de Valores Mobiliários (the "CVM”), the Brazilian securities regulator, ruled that, as a result of Arcelor Mittal’s acquisition of Arcelor, Arcelor Mittal was required to carry out a public offer to acquire all of the outstanding shares in Arcelor Brasil not owned by Arcelor or any other affiliate of Arcelor Mittal. Pursuant to the ruling, the value to be offered to Arcelor Brasil’s shareholders is to be determined on the basis of the value of the part of the overall consideration paid for Arcelor by Arcelor Mittal that was attributable to Arcelor Brasil. On April 17, 2007, the CVM granted registration of the offer, which opened on April 27, 2007 and will close on June 4, 2007. The consideration to be offered per Arcelor Brasil share is R$11.70 in cash and 0.3568 Arcelor Mittal class A common shares, subject to certain adjustments. As of April 26, 2007, the total value offered per Arcelor Brasil share would be €18.27 ($24.90). Tendering Arcelor Brasil shareholders may also accept an all-cash option, pursuant to which they would receive cash in an amount equal to the value of the cash and share consideration described above, calculated in the manner set forth in the offering documents. On the basis of the closing price for Arcelor Mittal’s shares on the New York Stock Exchange on April 26, 2007, the maximum amount of cash that may be paid by Arcelor Mittal will be approximately €3.8 billion ($5.3 billion) (assuming 100% acceptance of the cash option). The maximum number of Arcelor Mittal class A common shares that may be issued will be approximately 76 million shares, representing 5% of the share capital of Arcelor Mittal on a diluted basis (assuming 100% acceptance of the mixed consideration option). MITTAL STEEL COMPANY N.V. CONSOLIDATED FINANCIAL & OTHER INFORMATION   MITTAL STEEL COMPANY N.V. UNAUDITED CONSOLIDATED BALANCE SHEETS   As of March 31, December 31, In millions of US dollars 2007    2006(1)   ASSETS Current Assets Cash and cash equivalents, restricted cash and short-term investments $8,277  $6,146  Trade accounts receivable - net 10,318  8,769  Inventories 19,319  19,238  Prepaid expenses and other current assets 5,838  5,209            Total Current Assets   43,752      39,362    Goodwill and intangible assets 10,720  10,782  Property, plant and equipment -net 54,351  54,696  Investments in affiliates and joint ventures 4,058  3,492    Deferred tax assets 1,563  1,670  Other assets   2,340      2,164  Total Assets $116,784    $112,166    LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities Payable to banks and current portion of long-term debt $5,829  $4,922  Trade accounts payable 10,909  10,717  Accrued expenses and other current liabilities 10,061  8,921        Total Current Liabilities   26,799      24,560    Long-term debt, net of current portion 21,200  21,645  Deferred tax liabilities 7,419  7,274  Other long-term obligations and deferred employee benefits 8,182  8,496            Total Liabilities   63,600      61,975    Total Shareholders' Equity 44,642  42,127  Minority Interest   8,542      8,064  Total Equity   53,184      50,191  Total Liabilities and Shareholders' Equity   $116,784    $112,166  1 Amounts are derived from the Company’s audited financial statements for the year ended December 31, 2006 MITTAL STEEL COMPANY N.V. CONSOLIDATED FINANCIAL & OTHER INFORMATION   MITTAL STEEL COMPANY N.V. UNAUDITED CONSOLIDATED STATEMENTS OF INCOME DATA & OTHER INFORMATION Three Months Ended   In millions of US dollars, except shares, per share and shipment data March 31, December 31, March 31,     2007    2006    2006  STATEMENT OF INCOME   Sales $ 24,476  $ 23,203  $8,430  Depreciation 891  865  357  Operating income 3,455  2,630  952  Operating margin % 14.1% 11.3% 11.3%   Other income (expense) – net 21  46  7  Income from equity method investments 154  163  25    Financing costs - net   (10)   (179)   (175) Income before taxes and minority interest   3,620    2,660    809    Income tax expense   934    377    117  Income before minority interest 2,686  2,283  692  Minority interest   (436)   (366)   (82) Net income   $2,250    $ 1,917    $610  Basic earnings per common share $1.62  $1.38  $0.87  Diluted earnings per common share 1.62  1.38  0.86  Weighted average common shares outstanding (in millions) 1,386  1,385  704  Diluted weighted average common shares outstanding (in millions) 1,388  1,387  706    OTHER INFORMATION Total shipments of steel products1 (Millions of metric tonnes)   27.0    26.7    14.1  1. Some inter-company shipments are not eliminated MITTAL STEEL COMPANY N.V. CONSOLIDATED FINANCIAL & OTHER INFORMATION   MITTAL STEEL COMPANY N.V. UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS In millions of US dollars Three Months Ended     March 31, 2007   December 31, 2006   March 31, 2006 Operating activities: Net Income 2,250  1,917  610  Adjustments to reconcile net income to net cash provided by operations: Minority interests 436  366  82  Depreciation 891  865  357  Others (274) (785) (207) Changes in operating assets and liabilities, net of effects from acquisition   (653)   1,904    (454) Net cash provided by operating activities   $2,650    $4,267    $388  Investing activities:             Purchase of property, plant and equipment   (988)   (1,633)   (263) Acquisition of net assets of subsidiaries, net of cash acquired   862    (43)   (15) Net cash used in investing activities   (126)   (1,676)   (278) Financing activities:             Proceeds (payments) from payable to banks and long-term debt   15    (2,292)   7  Dividends paid   (514)   (210)   (136) Other financing activities (net)   46    (42)   -  Net cash provided by (used in) financing activities   (453)   (2,544)   (129) Net increase (decrease) in cash and cash equivalents   2,071    47    (19) Effect of exchange rate changes on cash   67    241    35  Cash and cash equivalents:             At the beginning of the period   6,020    5,732    2,035  At the end of the period   $8,158    $6,020    $2,051