Company: MT
Filing Date: 2025-03-10
Form Type: 20-F
Source: 0001243429-25-000017
Chunk: 385

Company: ArcelorMittal
Filing Date: 2025-03-10
Form: 20-F
Chunk 385
---
 products are returned or have claims filed against the sale because the products contained quality defects or other problems. Claims may be either of the following: – Product Rejection - Product shipped and billed to an end customer that did not meet previously agreed customer specifications. Claims typically result from physical defects in the goods, goods shipped to the wrong location, goods produced with incorrect specifications and goods shipped outside acceptable time parameters. – Consequential Damages - Damages reported by the customer not directly related to the value of the rejected goods (for example: customer processing cost or mill down time, sampling, storage, sorting, administrative cost, replacement cost, etc.). The Company estimates the variable consideration for such claims using the expected value method and reduces the amount of revenue recognized. Warranties: The warranties and claims arise when the product fails on the criteria mentioned above. Sales-related warranties associated with the goods cannot be purchased separately and they serve as an assurance that the products sold comply with agreed specifications. Accordingly, the Company accounts for warranties in accordance with IAS 37 "Provisions, Contingent Liabilities and Contingent Assets" (see note 9). Periodically, the Company enters into volume or other rebate programs where once a certain volume or other conditions are met, it refunds the customer some portion of the amounts

232

| Consolidated financial statements                          |
| (millions of U.S. dollar, except share and per share data) |

previously billed or paid. For such arrangements, the Company

only recognizes revenue for the amounts it ultimately expects to

realize from the customer. The Company estimates the variable

consideration for these programs using the most likely amount

method or the expected value method, whichever approach best

predicts the amount of the consideration based on the terms of

the contract and available information and updates its estimates

each reporting period.

The Company’s payment terms range from 30 to 90 days from

date of delivery, depending on the market and product sold. The

Company received 505 and 351 as of December 31, 2024, and

2023, respectively, as advances from its customers which are

classified as unsatisfied performance obligations and

recognized as liabilities in line with IFRS 15. The Company

expects 100% of these unsatisfied performance obligations as

of December 31, 2024 to be recognized as revenue during 2025

as the Company’s contracts have an original expected duration

of one year or less.

The tables below summarize the movements