BlueScope shares rise on reaffirmed guidance
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More news: Shares in BlueScope gained on the ASX after the steelmaker reiterated its first-half earnings guidance, which it revised down last month.
BlueScope shares were up 1.6% to $21.21 by 1:50pm AEDT, having lowered nearly 10% since January.
BlueScope reiterates guidance despite steel industry slowdown
The news: Australia's largest steelmaker BlueScope has reiterated its first-half EBIT guidance, which it revised down last month, but flagged continued "challenging operating conditions" in the global steel industry.
The numbers: At its annual general meeting today, BlueScope will confirm its first-half underlying EBIT guidance of between $270 million to $310 million, which was reduced from its prior guidance range of $350 million to $420 million in October.
BlueScope expects its Australian steel products business to deliver first-half EBIT "above two thirds" of its FY24 second-half total. It said the softer performance is driven by weaker realised pricing, higher realised raw material and conversion costs, a $10 million lower coke contribution, and unfavourable provision adjustments.
The group's North America segment is expected to record a first-half result "slightly below half" that of its FY24 second-half, with its US-based business North Star hampered by the "materially lower" benchmark and realised spread environment.
Elsewhere, BlueScope forecasts its Asia and New Zealand and Pacific Islands segments to report a flat result half over half.
The context: BlueScope highlighted challenging operating conditions facing the broader steel industry, including continued softness in East Asian spreads off the back of record levels of Chinese exports, ongoing cost inflation and a period of pause and uncertainty in the US.
What they said: "While these pressures are impacting industry performance in the near-term, our growing position in North America and continued growth in value-added and premium banded products, gives us confidence in BlueScope's resilience and longer-term success, underpinned by a robust balance sheet, and strong operating disciplines," said BlueScope's managing director and CEO Mark Vassella.
The source: ASX announcement
