BlueScope maintains profitability in late 2023

Steel producer BlueScope, which operates a recycled-content electric arc furnace (EAF) mill in Delta, Ohio, has reported net profit after tax (NPAT) of $287 million for the second half of 2023, which represents a 6.6 percent increase from NPAT in the prior six months.

“We’ve seen real volatility across the global economy, particularly prevalent in the steel sector,” BlueScope CEO and Managing Director Mark Vassella says. “Despite this, I’m pleased to report BlueScope has again delivered a strong result."

The company’s most recent results cover the first half of its 2024 fiscal year. Regarding the rest of the fiscal year, which runs Jan. 1 to June 30, Vassella says, “Our outlook for the company in the second half is for a result slightly below [the first half of the fiscal year], in an environment of unprecedented softness in Asian steel spreads.”

Away from the Australian and Asian market, the company says the United States is an "exciting" growth region, where it sees strong demand for steel, particularly for large-scale infrastructure investments, steel-intensive renewable energy systems and the build-out of e-commerce buildings over the coming decade.

A BlueScope expansion project at its North Star facility in Ohio has proceeded on track. “In the U.S., the ongoing ramp-up of North Star is nearing full run rate, and the recycling business is performing well," Vasella says.

He says the company's EAF conversion project near Auckland, New Zealand, represents its next step in boosting its presence in the recycled-content steel sector. “We’ve begun works to install the nearly $200 million EAF, securing a bright future for steelmaking at New Zealand Steel,” Vassella says.

The company also continues to invest in the U.S. “BlueScope continues to invest in the expansion and debottlenecking of North Star, building self-sufficiency in scrap through BlueScope Recycling and in painted products through BlueScope Coated Products," he says. "The company is advancing feasibility work into expanding and integrating its U.S. value chain through the potential addition of 550,000 tons per year of cold rolling and metal coating capacity into our operations.”

Although BlueScope enjoyed boosted profits in late 2023, the U.S. market was not the leading profit center. In the second half of last year, the company's earnings before interest and taxes (EBIT) in North America fell by 15 percent compared with the prior six months.

BlueScope points to “slightly weaker spreads in the half on the back of the United Auto Workers strike” as one culprit. Nonetheless, the firm says its Ohio mill operated at full capacity, with higher volume on stable end-use demand and ongoing progress of the expansion ramp up, with a full run rate expected later this year.