The world’s largest steel maker by volume expects modest improvement in the European Union after declines in 2012 and 2013.

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ArcelorMittal (NYSE:MT) anticipates EBITDA would rise to around $8 billion in 2014 as against $6.89 billion clocked last year.

The world’s leading integrated steel and mining company today unveiled results for the three and twelve-month periods ended December 31, 2013.

Net loss narrows

ArcelorMittal (NYSE:MT) announced Friday a net loss of $1.23 billion, or 69 cents a share, in the three months ended December 31. This is against a net loss of $3.81 billion or $2.47 a share reported for the same period last year.

The company’s fourth-quarter revenue rose 2.8% to $19.85 billion, while its earnings before interest, taxes, depreciation and amortization rose 23% from a year earlier to $1.91 billion, beating analyst expectations of $1.79 billion, based on a FactSet pool of 10 analysts.

ArcelorMittal (NYSE:MT)’s EBITDA rose due to a 4.4% increase in steel shipments to 21 million tons, a 56% increase in marketable iron ore shipments and benefits from cost savings and a restructuring of its assets.

During the last quarter, steel giant ArcelorMittal signed a 50-50 joint venture pact with Japan’s Nippon Steel & Sumitomo Metal Corp (TYO:5401) to acquire ThyssenKrupp AG (FRA:TKA) (ETR:TKA)’s 100% interest in ThyssenKrupp Steel USA for $1.55 billion. The acquisition is an important strategic fit for ArcelorMittal and it is expected to deliver $60 million of annual synergies.

ArcelorMittal’s turnaround still work in progress

The steel major has been struggling for over a year with a global glut in steel making capacity and lower steel prices. The company initiated major restructuring initiatives including cutting capacity in Europe and retooling its struggling business in Europe. According to Alex Macdonald of The Wall Street Journal, Friday’s results, including its large net loss, underscores the fact that ArcelorMittal’s turnaround effort was still a work in progress.

ArcelorMittal (NYSE:MT) forecast a slowdown in consumption growth in China and Brazil, though it witnessed a modest improvement of 1.5%-2.5% in the EU after declines in 2012 and 2013.

The company anticipates its core profit (EBITDA) would increase to $8 billion in 2014, in line with the Thomson Reuters I/B/E/S mean estimate for 2014 of $8.1 billion. However, the company clarified that such an improvement would be predicated by a 3% increase in steel shipments, a 15% rise in shipments of iron ore, average ore prices in line with the market consensus and a moderate increase in steel margins.

Highlighting its outlook for 2014, ArcelorMittal (NYSE:MT) indicated in a press release that net interest expense would be roughly $1.6 billion for 2014, while capital expenditure would be roughly $3.8 to $4.0 billion for 2014. The steel major hopes to maintain its medium term net debt target at $15 billion.