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Record profits for Bluescope, but outlook weaker

Bluescope chief executive officer Paul O’Malley said the positive result was driven predominantly by improved business spread and the weaker Australian dollar in the first quarter, which delivered an underlying first quarter net profit after tax of around $430 million. “However, in the second quarter of the reporting period, export sales from Australia were materially curtailed by the economic downturn around the world and the substantially lower demand for steel globally and in Australia,” O’Malley said.“We are also seeing lower international steel prices while still experiencing peak raw material costs.”He said this means the company expects to see a negative underlying NPAT contribution for the second half of fiscal 2009, the extent of which is dependent on demand and spread.”Government stimulus packages may translate into some improvement in economic activity later this calendar year, but it remains to be seen how it will affect steel demand,” O’Malley said.”We are focused on four key areas: a robust balance sheet; strong liquidity position; disciplined capital expenditure management and delivering an expected $150 million savings on existing and new cost management programs,” he said.

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