Bluescope Steel Limited · ASX:BSL
Bluescope Steel — FY2009 Earnings Presentation
95 slides from Bluescope Steel's earnings presentation, Aug 17, 2009
Slide 1: FY2009 Results Presentation
For personal use only FY2009 Results Presentation Period Ended 30 June 2009 Paul O’Malley, Managing Director and Chief Executive Officer Charlie Elias, Chief Financial Officer 17 August 2009 ASX Code: BSL
Slide 2: Important notice
Important notice For personal use only THIS PRESENTATION IS NOT AND DOES NOT FORM PART OF ANY OFFER, INVITATION OR RECOMMENDATION IN RESPECT OF SECURITIES. ANY DECISION TO BUY OR SELL BLUESCOPE STEEL LIMITED SECURITIES OR OTHER PRODUCTS SHOULD BE MADE ONLY AFTER SEEKING APPROPRIATE FINANCIAL ADVICE.
Slide 3: Introduction and Headlines
For personal use only Introduction and Headlines Page 3
Slide 4: Safety – Our target remains Zero Harm
Safety – Our target remains Zero Harm For personal use only Lost Time Injury Frequency Rate Medically Treated Injury Frequency Rate 18 70 16.0 NSW Manufacturing 16 60.0 2005 – 27.9 Medically treated injuries per million man-hours worked 60 14.0 2006 – 24.4 Lost time injuries per million man-hours wo
Slide 5: Group financial headlines FY2009 vs. FY2008
Group financial headlines FY2009 vs. FY2008 …underlying NPAT down 93% For personal use only TWELVE MONTHS ENDED 30 JUNE VARIANCE 2009 2008 % Revenue A$10,329M A$10,495M Down 2% External despatches 6.0M tonnes 8.1M tonnes Down 26% EBITDA − Reported A$380M A$1,420M - − Underlying A$536M A$1,630M Down
Slide 6: Underlying EBIT variance FY2008 to FY2009 by major item
Underlying EBIT variance FY2008 to FY2009 by major item …largely driven by weaker steel demand For personal use only Raw Materials: Net spread improvement $56m (1) Coal (657) 3000 Iron ore (403) External Steel Feed (373) $1,352m Scrap (34) 2500 NZ Raw Materials (27) Opening Stock Adj 151 Underlyin
Slide 7: Underlying EBIT variance 1H FY2009 to 2H FY2009
Underlying EBIT variance 1H FY 2009 to 2H FY 2009 …which is a tale of two halves For personal use only y price and volume collapse, partly mitigated by raw material costs (feed, and coal price averaging) 1000 Net spread reduction ($819) Raw Materials: Coal 115 800 $753m Ext Stl Fd 103 Alloys 58 Co
Slide 8: Underlying EBIT variance FY2008 to FY2009 by business segment
Underlying EBIT variance FY 2008 to FY 2009 by business segment …the lower demand in FY 2009 was reflected in BlueScope’s global operations producing at lower utilisation rates For personal use only 1400 $1,273m 1200 EBIT A$ Millions 1000 800 600 400 $2m ($859m) ($77m) $182m $171m 200 ($97m) 0 ($163
Slide 9: Our markets - external sales by region
Our markets - external sales by region …and lower demand was also reflected across all our markets For personal use only FY2008 FY2009 Exports 8% Exports 29% 18% 25% (2,374kt) 8% (1,492kt) 4% 9% 21% 12% 13% 12% 11% 38% 4% 38% 4% (3,101kt) (2,290kt) 8,133kt 26% decline 5,986kt Key Exports - Americas
Slide 10: Total Australian external domestic despatches by market segment
Total Australian external domestic despatches by market segment …and across all of our segments in Australia SALES TONNES For personal use only FY2008(1) Construction FY2009(1) 3,200 61% (1,892kt) Principal variances: y Slowing activity levels and high inventory 2,800 Non-dwelling 26% through the ch
Slide 11: Our markets
Our markets …however both our domestic and export markets and sales are recovering For personal use only y Global de-stocking appears to have ceased for most steel products y Received a large number of enquiries across our product range y Improved sales volumes to long term relationship customers y
Slide 12: Significant actions taken through FY 2009 – strengthened balance sheet
Significant actions taken through FY 2009 …we strengthened the Balance Sheet For personal use only y Equity ¾ December placement and February SPP raised $400M net ¾ Entitlement offer raised net A$1,360M y Debt ¾ Termed-out loan note facility with new A$1,275M multi currency facility (replacing old L
Slide 13: Significant actions taken – monetised inventory
Significant actions taken through FY 2009 …aggressively monetised inventory For personal use only +70% vs Jun-2008 +3% Carrying vs Jun-2008 value of $2,815M inventory at period end $1,660M $1,702M Jun-2008 Dec-2008 Jun-2009 Volume change from ~ +25% -12% June 2008 vs Jun-2008 vs Jun-2008 Page 13
Slide 14: Significant actions taken – fixed cost and overhead reduction
Significant actions taken through FY 2009 …also achieved significant fixed cost and overhead reduction of $295 million, in addition to lower volume-linked conversion costs For personal use only y At 1H FY 2009 we indicated we were pursuing $150m of cost reductions. Achieved $295m in the nine months
Slide 15: Outlook
Outlook …encouraged by improving market conditions in early 1H FY 2010 For personal use only OUTLOOK y Encouraged by improving global steel demand and pricing in early FY 2010 ¾ However, demand improvement off a low base ¾ BSL will not receive full pricing benefit in 1Q FY 2010 y Steelmaking raw mat
Slide 16: Strategy
Strategy …our strategy has not changed but moving forward with an element of caution For personal use only y Reinvigorate our position in the Australian/NZ markets, through ongoing focus on strengthening our customer relationships, product and service innovation and driving operational efficiency. y
Slide 17: Carbon Pollution Reduction Scheme (CPRS)
Carbon Pollution Reduction Scheme (CPRS) For personal use only y We support the need to reduce global CO2 emissions and we will work to reduce our CO2 emissions. y But we have grave concerns about the current design of the proposed CPRS and the negative impact it will have on the Australian steel in
Slide 18: Environmentally Responsible
Environmentally Responsible ….a proven track record - with 30 years of environmental footprint improvements For personal use only Investment Track Record: Leader in Water Conservation: y BlueScope has invested $500 million on Port Kembla Steelworks: environmental related improvements y Over 14 billi
Slide 19: CPRS does not meet the Government's stated policy objectives
CPRS…. does not meet the Government’s stated policy objectives: to address the competitive challenges facing emission-intensive trade-exposed (EITE) industries in Australia. For personal use only y BlueScope Steel’s Australian operations are world competitive – exporting 50 per cent of steel product
Slide 20: Australian steel industry needlessly at risk
Australian steel industry needlessly at risk – our competitors are unlikely to face a comparable cost Country Annual Propensity to Mandatory carbon cost from Blast Furnace production - Mt1 increase steel 2011? efficiency For personal use only (% of world) exports to Aust? approx. avg. coal use (kg/t
Slide 21: CPRS – Our Objection
CPRS – Our Objection ….without comparable global action, a compounding tax For personal use only y CPRS is not a one-off, one-year decision. y Without comparable global action, the cumulative cost of the CPRS is a compounding tax over many years - it will impair our trade competitiveness: ¾ At a $10
Slide 22: CPRS unfair on regional Australia
CPRS….unfair on regional Australia – threatening jobs and undermining investment For personal use only y Our total impact on the Illawarra regional economy* : ¾ Employment: over 12,000 full time equivalent jobs (+ more than 1000 employees and contractors at Western Port in Victoria) ¾ Gross Regional
Slide 23: CPRS can be designed to deliver a fair go
CPRS ….can be designed to deliver a ‘fair go’ for the Australian steel industry and regional Australia For personal use only y The Government stated: “There is no point in imposing a carbon price domestically which results in emissions and production transferring internationally for no environmental
Slide 24: BlueScope Steel Financial Results
For personal use only BlueScope Steel Financial Results Page 24
Slide 25: Earnings performance
Earnings performance …second half of FY 2009 heavily impacted by materially weaker spreads and lower despatches For personal use only A$ Millions FY2005 FY2006 FY2007 FY2008(3) FY2009 2009-1H 2009-2H Revenue (1) 7,964 8,031 8,913 10,495 10,329 6,156 4,173 EBITDA (2) 1,655 850 1,423 1,420 380 857 (47
Slide 26: Underlying EBIT variance FY2008 to FY2009 by business segment
Underlying EBIT variance FY 2008 to FY 2009 by business segment …the lower demand in FY 2009 was reflected in BlueScope’s global operations producing at lower utilisation rates For personal use only 1400 $1,273m 1200 EBIT A$ Millions 1000 800 600 400 $2m ($859m) ($77m) $182m $171m 200 ($97m) 0 ($163
Slide 27: Reconciliation from Reported to Underlying EBIT for FY 2009
Reconciliation from Reported to Underlying EBIT for FY 2009 For personal use only A$M 250 China impairments: Metal Coating Line 25 Panels 11 NZ Growth Projects $10m $4m 200 Feasibility write-offs $36m ($8m) ($3m) $171m Restructure & Redundancy $110m ($15m) $22m 150 $75m 100 Australia 52 Nth Americ
Slide 28: Aggressive cost reduction
Aggressive cost reduction …$295m of savings in nine months to June in fixed conversion and discretionary items For personal use only y Exceeded our $150m target ¾ $113m of savings to neutralise impact of escalation ¾ A further $182m of savings achieved off 2008 cost base y Volume related conversion
Slide 29: Cost saving initiatives
Cost saving initiatives …and spend has been reduced across our divisions For personal use only Divisional Split of the $295m Divisional Split of $132m Permanent Savings NZS 2% Corporate 5% Corporate, 4% Coated Coated & Building & Building Products Products Asia Asia 8% 11% Australian Coated & Austra
Slide 30: Cashflow
Cashflow …strong working capital inflow in 2H FY 2009 more than offset negative cash from operations For personal use only Impact of economic A$ millions FY2007 FY2008 FY2009 2009-1H 2009-2H slowdown Cash from operations 1,364 1,579 534 926 (392) Working capital movement (21) 69 250 (863) 1,113 Mone
Slide 31: Balance sheet
Balance sheet Balance sheet – significant improvements in working capital and gearing improvements in working capital and[Duncan …significant gearing to verify comments] Asatat As [Tim – remove Material cashdecimal For personal use only balance A$ Millions Millions June 2008 30 June 2008 2008 31 Dec
Slide 32: Balance Sheet – delivered on monetising inventory
Balance Sheet …delivered on monetising inventory For personal use only RMS 994 A$M RMS 546 WIP 571 WIP (30) FGS 1,057 RMS (260) 4000 FGS 110 Other 193 WIP (84) Other 29 FGS (509) 3500 Other (9) RMS 519 RMS 617 WIP 475 WIP 167 $319m FGS 517 3000 FGS 712 $2,815m $655m Other 191 Other 164 2500 ($204m)
Slide 33: Balance Sheet – net equity increased
Balance Sheet …net equity increased by $1,720m largely on account of equity raisings For personal use only y In addition to equity raisings, exchange rate fluctuation ($182m favourable) and dividend payments ($252m outflow) were the other large movements. y Post tax impact of defined benefit super a
Slide 34: Balance Sheet – conservative gearing
Balance Sheet …positioned with conservative gearing For personal use only y Gearing at 11.8% (ND/ND+E), below our normal 30-35% target band y FX was unfavourable in 1H 2009, but helped in 2H 2009 y Net debt at 30 June of $756m, comprised of $1,125m of drawn debt less $369m cash y 31 July 2009 total
Slide 35: Debt Facilities and Maturity Profile
Debt Facilities and Maturity Profile …no material refinancing obligation due until July 2011 For personal use only A$M 1,200 1,000 800 600 1,075 400 200 635 200 121 107 170 0 1H10 2H10 1H11 2H11 1H12 2H12 1H13 2H13 1H14 2H14 >1H15 Other USPP Sy ndicated Loan Note Facility Note: - Facilities chart is
Slide 36: EBIT sensitivities (FY 2008 reference)
In view of material changes to domestic & export demand in FY 2009 it would be misleading to include the 09 sensitivities. Included FY 2008 as a reference point (full production and typical domestic/export sales split) For personal use only Estimated impact on EBIT (A$mil) Assumption FY 2008 +/– US$
Slide 37: Summary
Summary For personal use only y 1H FY 2009 – good first quarter y 2H FY 2009 – material market contraction y 1H FY 2010 ¾ increasing sales both in domestic and export ¾ improving supply chain ¾ further material cost reductions ¾ expect small negative reported NPAT y Ensure future of Australian steel
Slide 38: Questions & Answers
For personal use only Questions & Answers Page 38
Slide 39: FY2009 Results Presentation
For personal use only FY2009 Results Presentation Period Ended 30 June 2009 Paul O’Malley, Managing Director and Chief Executive Officer Charlie Elias, Chief Financial Officer 17 August 2009 ASX Code: BSL
Slide 40: Supporting Information
For personal use only Supporting Information Page 40
Slide 41: Reporting Segments Additional Information
For personal use only Reporting Segments Additional Information Page 41
Slide 42: Reporting Segments
Reporting Segments Corporate / Group For personal use only Australia New Zealand Asia North America Coated & Australian New Zealand Coated & Hot Rolled Coated & Industrial Distribution & Pacific Building Products Building Products & Solutions Islands Products North America Products Australia Product
Slide 43: Australia: Coated & Industrial Products, Distribution & Solutions
For personal use only Australia Coated & Industrial Products Distribution & Solutions Page 43
Slide 44: Coated & Industrial Products Australia
Coated & Industrial Products Australia For personal use only Markets y Domestic Underlying EBIT ¾ strong Q1, followed by material fall in demand in Q’s 2&3 1200 and modest improvement in Q4 off a very low base. 1000 y Exports ¾ similar demand pattern to the domestic market albeit the 900 766 downtur
Slide 45: Coated & Industrial Products Australia – underlying EBIT variance analysis
Coated & Industrial Products Australia – underlying EBIT variance analysis (FY2009 vs FY 2008) For personal use only Raw materials: Coal (657) Net Spread Reduction ($291m) Iron ore (403) 1800 Scrap (34) 1600 $707m Op Stock Adj 151 Coating Metals 70 Alloys 4 1400 1200 $1,000m EBIT A$M 1000 Conversi
Slide 46: Key drivers of Coated & Industrial Products Australia FY2009 result
BlueScope Steel – Key drivers of Coated & Industrial Products Australia FY2009 result For personal use only Significant increase from around US$700/t at start of half to above US$1,000/t at end Held above or around US$1,000/t 1H 2008 2H 2008 1H 2009 2H 2009 through August, then declined to around US
Slide 47: Western Port – Pickle Line Fire
Western Port – Pickle Line Fire For personal use only y Fire occurred in pickle-line at Western Port plant, Hastings Victoria on 13 May 2009 ¾ Pickle process precedes cold rolling ¾ Fire started in pickle tanks ¾ Damage contained largely to pickle tanks and non-structural roof damage; no other proce
Slide 48: PKSW – Production & Despatch Flow
PKSW – Production & Despatch Flow For personal use only Port Kembla Steelworks Slab Production Slab Export FY09 FY08 1,098 1,909 302 763 3,517 5,285 Interco Western Port (2) 796 1,146 Inventory movements & yield losses Hot Strip HRC Domestic Mill 2,075 2,881 425(3) 653 Port Kembla Steelworks Export
Slide 49: Coated Australia – Annual Capacities
Coated Australia – Annual Capacities For personal use only Western Hot Strip Mill HRC Port 1,430 Pickle Line HRC 1,150 Slab Cold Mill CRC 1,000 Port Kembla Metal Coating Lines Metal Coated 830 Strip Steelworks Paint Lines Painted Strip 330 HRC Springhill Coupled Pickled Cold Mill CRC 990 Metal Coati
Slide 50: Port Kembla Steelworks despatches
Port Kembla Steelworks despatches For personal use only 6,000 5,268 5,209 5,210 4,922 5,000 32% 26% 4,000 28% 40% 3,466 (ktonnes) 18% 18% 22% 3,000 21% 16% 17% 2,000 51% 44% 50% 56% 61% 1,000 0 FY2005 FY2006 FY2007 FY2008 FY2009 Internal Customers Domestic Customers Export Customers External Product
Slide 51: Port Kembla Steelworks productivity
Port Kembla Steelworks productivity For personal use only Productivity (Crude Steel Output, Tonnes/Employee/Year) Employees Productivity (Tonnes per person per year) 6,000 2,000 1,750 1,500 4,000 1,250 Employee Numbers 1,000 750 2,000 500 250 0 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 FIS
Slide 52: Port Kembla Steelworks – cost profile
Port Kembla Steelworks – cost profile For personal use only Total cost $ A$m FY2003 FY2004 FY2005 FY2006 FY2007 FY2008 1H09 2H09 FY2009 S&A Conversion Costs Despatch & Freight Raw Materials − Chart shows cost of despatches − Conversion costs include depreciation − Raw material includes iron ore, coa
Slide 53: PKSW – Consumption of primary raw materials
PKSW – Consumption of primary raw materials For personal use only Dry Tonnes Consumed FY2007 FY2008 FY2009 Coal Coking 2.9 3.0 2.2 – Coking coal principally sourced PCI 0.7 0.6 0.4 from local BHP Billiton Illawarra mines (30 year Anthracite 0.1 0.1 0.0 contract from July 2002) Total 3.7 3.7 2.6 Iron
Slide 54: Global iron ore fines, coking coal and semi soft coal benchmark prices
Global iron ore fines, coking coal and semi soft coal benchmark prices For personal use only 2002 2003 2004 2005 2006 2007 2008 2009 2010 Iron Ore Fines $17.97 $17.54 $19.12 $22.68 $38.88 $46.27 $50.66 $91.14 $61.061 US$/dmt % change 4.3% -2.4% 9.0% 18.6% 71.5% 19.0% 9.5% 79.9% -33% Hard Coking Coal
Slide 55: Slab and HRC price benchmarks for Asia & Australian sales
Slab and HRC price benchmarks for Asia & Australian sales For personal use only • The following Steel Business Briefing prices continue to be a reasonable public benchmark for BlueScope’s domestic and Asian HRC prices (noting this can change over time). US$/t Asian HRC Benchmark Price SBB HRC East A
Slide 56: Port Kembla Steelworks – No.5 Blast Furnace reline
Port Kembla Steelworks – No.5 Blast Furnace reline For personal use only Page 56 Page 56
Slide 57: Port Kembla Steelworks – major capital investments
Port Kembla Steelworks …major capital investments in our future For personal use only Photos courtesy Illawarra Mercury y $372M blast furnace No. 5 reline and approximately $140M Sinter Plant upgrade projects delivered safely, on time and largely within budget. Australian Steel Mill Services (an all
Slide 58: No.5 Blast Furnace Reline Project
Port Kembla Steelworks- No.5 Blast Furnace Reline Project For personal use only Photos courtesy Illawarra Mercury y The carbon hearth, refractories and staves (furnace shell cooling elements) were completely stripped out of the blast furnace and replaced with new ones. Internal platforms enabled wor
Slide 59: Port Kembla Steelworks – Sinter Plant upgrade
Port Kembla Steelworks – Sinter Plant upgrade For personal use only y Sinter plant upgrade completed June 2009 y Total capital cost approximately A$140m, with $9m final spend estimated in FY 2010. y No.3 Sinter machine at PKSW ¾ is single source of 5.3 mtpa of sinter for No. 5 & No. 6 blast furnaces
Slide 60: Sinter Plant major upgrade
Port Kembla Steelworks …the Sinter Plant underwent a major upgrade and 20% increase in capacity For personal use only Photos courtesy Illawarra Mercury Page 60
Slide 61: What is sinter?
What is sinter? For personal use only Page 61
Slide 62: Australian Distribution & Solutions
Australian Distribution & Solutions For personal use only Underlying performance – FY 2009 vs FY 2008 Underlying EBIT 150 • EBIT reduction of 90% largely due to − inventory realisable value provision 86 − lower despatches 100 64 75 EBIT A$ Millions − higher freight costs 50 • Distribution 6 22 9 − w
Slide 63: Australian Distribution & Solutions – underlying EBIT variance
Australian Distribution & Solutions – underlying EBIT variance (FY 2009 vs FY 2008) For personal use only Net Spread Increase A$88M 600 500 $390m 400 EBIT A$M 300 200 Other: ($302m) NRV Adjs (41) $86m 100 ($117m) $9m ($7m) 0 ($41m) June 08 FY Domestic Raw Material Volume Conversion & Other June 09
Slide 64: Australian Distribution & Solutions
Australian Distribution & Solutions For personal use only The Distribution and Solutions division brings together BlueScope Steel’s Australian-based downstream businesses Emerging Sheet & Coil Business y Plate Processing y Tanks/Irrigation y Roofing Services y Tube y Hot Rolled coil y High and Low y
Slide 65: Australian Distribution and Solutions – Overview
Australian Distribution and Solutions - Overview For personal use only Darwin KEY Lysaght Cairns Sheet & Coil Mareeba Processing Services Sheet Metal Supplies Townsville Bluescope Distribution Charters Towers Mount Isa Bluescope Water Mackay Rockhampton Emerald Gladstone Bundaberg Archerfield Acacia
Slide 66: Distribution - Market structure in Australia
Distribution - Market structure in Australia (FY 2009) For personal use only Sales by product group (t) Sales by sector (t) Other Other Reinforcing 8% Other Distributor 7% 8% Sheet & Coil 28% 8% Mining Building & Merchant Bar Construction 3% 10% 40% Structural 13% Plate Manufacturing 18% 42% Tubular
Slide 67: New Zealand & Pacific Islands
For personal use only New Zealand & Pacific Islands Page 67
Slide 68: New Zealand and Pacific Steel Products
New Zealand and Pacific Steel Products For personal use only Underlying EBIT Markets 100 90 y Domestic – softer demand conditions vs. FY 2008 85 78 y Export – increased sales in challenging export market. 75 87 Underlying performance – FY 2009 vs 2008 EBIT A$ Millions y EBIT up 2%, largely due to 49
Slide 69: New Zealand and Pacific Islands – underlying EBIT variance
New Zealand and Pacific Islands Products – underlying EBIT variance analysis (FY 2009 vs FY 2008) For personal use only Net spread improvement A$36M 140 $50m Other: NRV Adj's (12) 120 PISE (1) ($10m) $42m 100 ($17m) $87m $85m ($8m) ($13m) EBIT A$M 80 ($4m) 60 ($38m) Costs: 40 Vanadium / Scrap pric
Slide 70: Operations – New Zealand
Operations – New Zealand For personal use only Glenbrook • Iron and Steel production Auckland • Hot and Cold Rolling Mills Glenbrook Tauranga • Dual Pot Metal Coating Line Wharf Waikato North Head • Paint Line Taharoa • Plate Line • Hollow sections plant Waikato North Head Mine • Concentrated iron s
Slide 71: New Zealand - unique direct reduction process
New Zealand - unique direct reduction process For personal use only Page 71
Slide 72: New Zealand – raw materials
New Zealand – raw materials For personal use only Iron Sand Concentrate (Waikato North Head Mine) • Iron sand mined and concentrated on site - 58.5% Fe • 13mt of contained product in probable reserves and 13mt of contained product in proven reserves • Additional 591mt of inferred resource • Concentr
Slide 73: New Zealand Steel – FY2009 product flow
New Zealand Steel – FY2009 product flow Mine Sites For personal use only Iron Sands Export 0.7mt 2mt NZS Slab 0.54 HRC 35% Domestic 5% mt Export 51% Export Vanadium Interco (Export) 44% Slag 11kt Plate 11% Domestic 52% Export 48% Pipe 3% Domestic 100% Cold Mill 51% Domestic 9% Export 6% Interco (Exp
Slide 74: New Zealand – FY2009 product distribution
New Zealand– FY2009 product distribution For personal use only Indicative Product Mix (t) Indicative Sales by Country (t) Painted 9% Asia Australia Cold Rolled 17% 13% Metal Coated Japan 11% 6% 31% Pipe Pacific Islands 5% 3% USA/Canada 14% Indicative Sales by Sector (t) Hot Rolled Manufacturing New
Slide 75: New Zealand - FY 2009 Non steel revenue streams
New Zealand - FY 2009 Non steel revenue streams For personal use only Iron Sand • What is vanadium? • Iron sands exports from Taharoa of 702kt, down ¾ a form of metal 20% on FY2008, largely due to the scheduled dry ¾ it is extracted in slag form from the liquid iron dock of the MV Taharoa Express. •
Slide 76: Asia – Coated & Building Products Asia
For personal use only Asia Coated & Building Products Asia Page 76
Slide 77: Coated and Building Products Asia
Coated and Building Products Asia For personal use only Underlying EBIT Markets 100 y Generally weaker demand conditions in all markets 76 y China PEB and Indonesian markets improved in 2H FY 2009. 80 Underlying performance – FY2009 vs FY 2008 60 50 44 y EBIT reduction of 128% largely due to EBIT A$
Slide 78: Coated and Building Products Asia – underlying EBIT variance
Coated and Building Products Asia – underlying EBIT variance analysis (FY 2009 vs FY 2008) For personal use only Raw Materials: External Steel Feed (85) Internally sourced Steel Feed (141) Coating Metals 36 NetSpread Net spreadReduction reduction($40m) A$36M Other 3 250 $104m 200 Volume: 150 Tha
Slide 79: North America
For personal use only North America Hot Rolled Products Coated & Building Products Page 79
Slide 80: Hot Rolled Products North America
Hot Rolled Products North America For personal use only This segment includes: Underlying EBIT(1) 200 y North Star BlueScope Steel (50% interest) 155 y Castrip LLC 150 105 100 EBIT A$ Millions Markets (North Star) 69 y Despatches decreased 28% on FY 2008. 50 36 15 Underlying performance - FY2009 vs
Slide 81: Coated and Building Products North America
Coated and Building Products North America For personal use only Underlying EBIT Segment comprises: 120 (2) 99 y Building: Butler, VP, HCI 100 y IMSA: SteelScape, MetlSpan, ASC Profiles 80 61 60 EBIT A$ Millions (3) 37 38 37 Underlying performance – FY 2009 vs FY 2008 40 y EBIT reduction 91% largely
Slide 82: Coated and Building Products North America – underlying EBIT variance
Coated and Building Products North America – underlying EBIT variance analysis (FY 2009 vs FY 2008) For personal use only Comprises: y Butler Buildings North America: Butler, VP, HCI y IMSA: SteelScape, MetlSpan, ASC Profiles Net Margin Reduction A$39M 400 Net Spread Increase A$20M 350 $238m 300
Slide 83: Other
For personal use only Other Page 83
Slide 84: Production footprint and annual capacities
Production footprint and annual capacities (at at 30 June 2009) For personal use only Asia China 26 Lysaght and MC 250kt PEB Sites Painting 150kt • Coated and Building Products North America India(2) • North Star BlueScope JV Metal Coating 250kt Vietnam Hot Rolling 2.0mt (100%) Painting 150kt MC 125
Slide 85: BlueScope Steel China footprint
BlueScope Steel China footprint For personal use only FY 2009 REVENUE: A$ 513M EBITDA: (A$24M ) EBITDA – Underlying: A$12M EMPLOYEES: 2,047 NET OPERATING ASSETS (PRE-TAX): A$150M SUZHOU BlueScope Steel in China 1 Metal Coating/Painting Line Facility 4 Lysaght Manufacturing Facilities 3 Butler PEB Ma
Slide 86: BlueScope Steel North American footprint
BlueScope Steel North American footprint FY 2009 For personal use only REVENUE: A$ 2,189M EBITDA (reported): (A$92M) EMPLOYEES: 4,003 incl. North Star NET OPERATING ASSETS (PRE-TAX): A$1,102M NB: Revenue excludes BSL’s 50% interest in North Star BlueScope Steel. Alaska WA W A ME MT ND OR VT MN Burli
Slide 87: Calendar year earnings
Calendar year earnings For personal use only A$ Millions CY2003 CY2004(3) CY2005 CY2006 CY2007 CY2008(4) Revenue(1) 5,328 7,029 7,980 8,693 9,333 11,926 EBITDA(2) 857 1,501 1,411 1,052 1,130 1,775 EBIT(2) - reported 581 1,212 1,111 742 792 1,399 - operational - - 1,308 966 924 1,532 Net profit - rep
Slide 88: Corporate and Group Costs
Corporate and Group Costs – impacted each half by profit in stock elimination and foreign exchange movements For personal use only 50 30 6 A$m -9 -3 0 1H 2008 2H 2008 FY 2008 1H 2009 2H 2009 FY 2009 -50 -100 -106 -150 -136 Comprised of: Underlying cost (58) (43) (101) (61) (35) (96) Profit in stock
Slide 89: Historical dividend profile since listing in July 2002
Historical dividend profile since listing in July 2002 For personal use only Interim Final Special 70 42 / 20¢ 60 20 49 / 0¢ 50 47 / 0¢ 44 / 0¢ 30 / 10¢ 40 22 / 7¢ 10 26 27 30 24 24 7 20 18 13 10 18 20 21 22 5 / 0¢ 9 12 0 5 2003 2004 2005 2006 2007 2008 2009 FISCAL YEARS Page 89
Slide 90: Key reconciling items between underlying and reported profit
Restructure & redundancy costs, together with impairment charges, are the key reconciliating items between underlying and reported profit For personal use only EBIT ($M) NPAT ($M) FY 2009 FY 2008 FY 2009 FY 2008 Reported 15 1,063 (66) 596 Unusual or non-recurring events: ¾ Asset impairment 36(1) 251
Slide 91: Major approved capital projects and investment summary
Major approved capital projects and investment summary (in addition “Stay in Business” capital is approx. 75% of depreciation) For personal use only PROJECTS Total Est. Actual to FY2010 FY2011 FY2012 All in A$million Capex / Cost 30/6/09 Projects completed Thailand – Coating expansion 80 80 - - - Vi
Slide 92: Zinc and Aluminium Usage
Zinc and Aluminium Usage For personal use only Tonnes Zinc Aluminium FY2009(A) FY2008(A) FY2009(A) FY2008(A) AUSTRALIA Springhill 17,911 22,711 9,537 10,595 Western Port 15,827 21,954 8,758 10,590 Sub-total 33,738 44,665 18,295 21,185 NEW ZEALAND 6,679 6,831 3,206 3,619 ASIA 10,744 16,672 11,563 16,
Slide 93: Committed Debt Facilities as at July 2009
Committed Debt Facilities as at 31 July 2009 Maturity Committed Drawn For personal use only US$/THBm A$m A$m Syndicated Loan Note Facility Tranche 1 Jul-11 200 21 Tranche 2 Jul-12 1,075 - 2004 US Private Placement Notes Series A Jul-11 US$100 121 121 Series B Jul-14 US$200 242 242 2008 US Private Pl
Slide 94: Shares on issue – historical movements
Shares on issue – historical movements For personal use only Million (rounded) y Shares on issue at listing (July 2002) 793 y Share buy-backs to 31/12/08 (116) y Dividend reinvestment scheme to 30/06/09 +67 y Employee share plan issues to 30/06/09 +34 y Institutional share placement (Dec 08) +97 y S
Slide 95: FY2009 Results Presentation
For personal use only FY2009 Results Presentation Period Ended 30 June 2009 Paul O’Malley, Managing Director and Chief Executive Officer Charlie Elias, Chief Financial Officer 17 August 2009 ASX Code: BSL