ArcelorMittal SA (AS:MT), the world’s second-largest steelmaker, said its profits declined in Q3, hurt by weakening demand and high energy costs.

While the Luxembourg-based company’s core underlying earnings were better than forecasts, the company expects the squeeze to deteriorate in the current quarter. The relief from declining energy costs is more than offset by a faster descent in selling prices.

EBITDA (Earnings before interest, taxes, depreciation and amortization) dropped by more than half from a year earlier to USD 2.66 billion, some 10 per cent ahead of consensus. However, net income plunged by nearly three-quarters to USD 993M. EPS (Earnings per share) of USD 1.11 were down from USD 3.63 a year earlier. Sales, meanwhile, slipped 6 per cent to USD 19.9B.

The company’s CEO Aditya Mittal said that seasonally lower shipments, a reduction in exceptional price levels, destocking and higher energy costs combined to put profits under pressure. He added that the company had responded by cutting its capacity where costs were highest, notably in Europe, where it cut its gas demand by 30 per cent. Overall, steel shipments were down 6.9 per cent from a year earlier at 13.6 million tons.