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BlueScope’s record profit flows from company focus on North America

Manufacturing News

The United States market has been revealed as the new focus for BlueScope Steel in the company’s record $2.81 billion net profit after tax for FY22, 135 percent up on FY21 released today.

The company’s underlying EBIT operating profit of $1.58 billion for the second half was beaten only by its’ first half result of $2.2 billion.

BlueScope has now invested $5 billion in the US, with the latest 850,000 tonne expansion of its North Star mini-mill bringing its USA market share to five percent of total US flat steelmaking production.

BlueScope’s Australian steel operations which experienced strong demand from export markets such as Indonesia recorded an underlying EBIT of close to $1.3 billion, up 92 percent.

But this has been surpassed by the North American North Star operation which recorded an underlying EBIT of $1.9b billion, up 181 percent.

Even now the company continues to assess a further 500,000 of incremental steel production per year.

The company announced a 25 cent dividend, $367 million net cash and a $500 million cash on market share buy-back showing the results of many years focusing on improving profitability and financial strength – sometimes missing from manufacturing company results.

CEO Mark Vasella said the result was the best since BlueScope was divested by BHP and was listed on the stock market as an independent steel producer 20 years ago.

Vasella said: “Operating cash flow, after capital expenditure including on the North Star expansion, was $1.71 billion.

“From this, investments of $1 billion were made in the US acquiring the MetalX ferrous recycling business and the Coil Coatings business.

“These were well considered and well executed investments in our US growth plan.”

In Australia BlueScope continues top study the reline and upgrade of the mothballed No 6 blast furnace at Port Kembla and medium-term options for reducing the carbon intensity of steel produced at the site.

“our planning for the reline builds a bridge to future adoption of breakthrough lower emissions steelmaking, once it is technologically and commercially viable.”

Picture: BlueScope/North Star

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