Australian steel manufacturer BlueScope’s underlying earnings before interest and tax for the first half of fiscal year 2023 is expected to range between $800 million to $900 million.
The figure is still subject to spread, foreign exchange, and market conditions.
In an ASX announcement issued today, BlueScope said the outlook for its US businesses has shown a moderate improvement since August after its downstream businesses exceeded expectations, combined with foreign currency translation.
Meanwhile, domestic dispatches across Australia and New Zealand have been lower than anticipated due to high channel inventories, particularly in the distribution segment.
The company also cited customer hesitancy driven by falling regional prices.
Underlying domestic demand remains solid, supported by the ongoing pipeline of construction activity, albeit impacted by labour constraints and weather-related events, BlueScope detailed.
Mark Vassella, managing director and chief executive officer of the steelmaking giant, attributed the company’s record profits in FY2022 to macroeconomic tailwinds and the decisions made over the past decade that have allowed the company to take advantage of the strong conditions.
Vassella noted that the company is now positioning itself for the next decade by deploying its financial strength to secure a sustainable future, long-term growth and shareholder returns.
“Accordingly, we have invested over $2 billion to build a platform for long-term growth in the US, including the North Star expansion, the establishment of BlueScope Recycling and Materials, and the acquisition of Metal Coaters to establish BlueScope Coated Products, taking BlueScope’s total investment in the US to over $5 billion,” the company’s CEO said.
BlueScope is also advancing its longer-term decarbonisation plans while progressing the Port Kembla blast furnace reline and upgrade project.
“We’re continuing to progress our broader growth and transformation initiatives, with the continued rollout of our digital program, and further progression of our key investment priorities such as a new pipe and tube mill at Port Kembla and the possible addition of Australian metal coating capacity to support demand growth,” he added.
