BlueScope Steel (BSL) H2 2024 earnings summary

Executive summary

• Underlying EBIT reached AUD 1.34 billion (USD 1.34 billion), with ROIC of 11.9%, demonstrating resilience amid volatile macro conditions and lower Asian steel spreads; reported NPAT was AUD 806 million (USD 805.7 million), both down year-over-year.

• Over AUD 548 million (USD 548 million) returned to shareholders via dividends and buy-backs; net cash balance of AUD 364 million at year-end; board approved a 30 cps dividend and extended buyback program for up to AUD 270 million over 12 months.

• Advanced strategic projects including North Star debottlenecking, US value chain integration, Port Kembla Blast Furnace reline, MCL7 coating line, and NZ EAF project.

• Achieved a 12.2% reduction in steelmaking emissions intensity since FY2018, aligned with 2030 targets; continued progress on sustainability, safety, and diversity initiatives.

• Safety performance below expectations, including a contractor fatality in North America, prompting a global safety refocus initiative.

Financial highlights

• FY24 underlying EBIT: AUD 1.34 billion (USD 1.34 billion); H2 EBIT: AUD 621 million, at low end of guidance; reported NPAT: AUD 806 million (USD 805.7 million); underlying NPAT: USD 861 million.

• Revenue of USD 17.1 billion, down from USD 18.2 billion in FY2023; free cash flow of USD 434 million; net cash position: AUD 364 million as of June 30.

• Group liquidity exceeds AUD 3 billion; investment-grade credit ratings maintained; core bilateral loan facilities increased to AUD 1.5 billion.

• Annual dividend target increased to AUD 0.60 per share (60 cps); final FY24 dividend AUD 0.30 per share (30 cps); buyback program extended for up to AUD 270 million over 12 months.

• Underlying EBIT ROIC at 11.9%, down from 14.6% in FY2023.

Outlook and guidance

• H1 FY25 underlying EBIT expected between AUD 350 million and AUD 420 million, reflecting resilience amid challenging trading conditions.

• North America result expected to be about half of H2 FY24 due to lower spreads; North Star to deliver about one-third of H2 FY24.

• Australia to see moderately softer results, with higher costs and similar dispatches; Asia expected to improve by ~50% over prior half, with China expected to triple on seasonality.

• New Zealand and Pacific Islands to nearly double H2 FY24 earnings; focus on cost control, capital prioritization, and maintaining balance between growth and shareholder returns.

• Macroeconomic challenges persist in Australia and the US, with low steel spreads and inflationary pressures.