About this report
Together creating value for all
This is our sixth integrated annual report (IAR). With this report we aim to provide a transparent and balanced appraisal of the material issues that faced our business during the year under review and that impacted our ongoing ability to create value.
The report should be read in conjunction with the full ﬁnancial statements.
This report aims to provide all stakeholders with an account of the
group’s operational, ﬁnancial, economic, social and environmental
performance, its use of the capitals as described by the International
From 2017 we will report against the new King IV Code on Corporate Governance. To this end we began a process of aligning our disclosure in this report against the new code. This 2016 report was prepared in accordance with the recommendations of Principle 9.1 of King III and the International Integrated Reporting <IR> Framework.
Our 2015 IAR was adjudged overall winner in the Nkonki Top 100 JSE Listed Companies Integrated Reporting Awards and winner in the basic materials category. The report was the first in the history of the Top 100 Awards to receive a score of over 90%. It also won best report in the Chartered Secretaries Southern Africa small cap category.
Scope and boundary of this report
This IAR covers the period from 1 January 2016 to 31 December 2016. The previous IAR covered the 2015 ﬁnancial year. Our 2016 report concerns the operations of ArcelorMittal South Africa, which include Vanderbijlpark Works, Saldanha Works (flat steel products), Pretoria Works, our integrated long steel products division comprising Newcastle Works, Vereeniging and tubular products, and our Coke and Chemicals division. There has been no material change in the scope and boundary of the IAR compared to the prior year, or historical ﬁnancial data.
In this report we seek to address those issues that are most material to our formulation and execution of strategy.
As in the previous year, in 2016 our leadership explicitly determined that our most material issues related to:
- Our commitment to safety as embodied in our vision, mission and values
- Addressing the considerable risks that threatened the sustainability of our business and that of the primary steel industry in South Africa
Leadership’s determination of materiality was informed by detailed reports emanating from our enterprise risk management process and extensive engagement with stakeholders, many of whose interests are today more extensively aligned with those of the company.
A list of our most material issues is here.
Forward looking statements
Certain statements in this document constitute “forward looking statements” which involve known and unknown risks and opportunities, other uncertainties and important factors that could turn out to be materially different following the publication of actual results.
These forward looking statements speak only as of the date of this document. The company undertakes no obligation to update publicly, or release any revisions, to these forward looking statements, to reﬂect events or circumstances after the date of this document, or to reﬂect the occurrence of anticipated events.
We have in place a highly developed combined assurance model and systems, the effectiveness of which receives particular, ongoing focus from the board because of the extent to which our most material risks affect our sustainability. Given our reliance on a wide range of stakeholders to grant us our legal and social licences to operate, we place as much of a premium on the integrity of external reports (particularly that of this IAR) as we place on the information used for key internal decision-making.
To this end, limited assurance was applied to certain key performance indicators (KPIs), the number of which was the same (12) as in 2015. The limited assurance report may be found in our online IAR.
Regarding the summarised consolidated ﬁnancial statements 2016
We have provided summarised consolidated ﬁnancial statements in our printed report, in accordance with International Financial Reporting Standards (IFRS) and interpretations issued respectively by the International Accounting Standards Board (IASB) and the International Financial Reporting Interpretation Committee (IFRIC) of the IASB, in particular International Accounting Standard (IAS) 34 Interim Financial Reporting, the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee and the Financial Pronouncements as issued by the Financial Reporting Standards Council, and the requirements of the Companies Act of South Africa as applicable to summary ﬁnancial statements.
An independent audit was performed by Deloitte & Touche, expressing a modified opinion with an emphasis made on going concern. The opinion on the summarised consolidated ﬁnancial statements, included in the IAR.
The board, together with the audit and risk committee, takes responsibility for this IAR. The report was prepared by a representative team of the company, assisted by outside experts, which reported to the chief executive ofﬁcer (CEO) and chief ﬁnancial ofﬁcer (CFO). All directors were given at least three opportunities to review and comment on the contents and to ensure the report’s integrity. In the board’s opinion, this report addresses the material issues and accurately presents the integrated performance of the organisation and its impacts. The board authorised this report for release on 17 March 2017.
|Wim de Klerk||Dean Subramanian|
|Chief executive officer||Chief financial officer|