Bluescope Steel Limited · ASX:BSL
Bluescope Steel — Q4 2024 Earnings Presentation
41 slides from Bluescope Steel's earnings presentation, Aug 19, 2024
Slide 1: BlueScope ESG Webinar
BlueScope ESG Webinar Mark Vassella Managing Director and Chief Executive Officer David Fallu Chief Financial Officer Gretta Stephens Chief Executive, Climate Change and Sustainability 19 September 2024 Pictured: North Wollongong Surf Club in BlueScope Steel Limited. ASX Code: BSL NSW, featuring SUP
Slide 2: Important Notice
IMPORTANT NOTICE This presentation should be read in conjunction with BlueScope’s 2024 ESG Webinar (when available), second Climate Action Report, FY2024 Sustainability Report, Modern Slavery Statement and Corporate Governance Statement, all available at www.bluescope.com. This presentation is not a
Slide 3: Acknowledgement of Country
ACKNOWLEDGEMENT OF COUNTRY BlueScope acknowledges the Traditional Custodians of the land on which we work, live and operate. We recognise our First Nations Peoples who have inhabited Australia for millennia, their enduring connection to Country, sky, and waterways and their rich and vital cultures.
Slide 4: Our Purpose, Our Bond and Our Strategy
OUR PURPOSE, OUR BOND AND OUR STRATEGY Our Purpose: We create and inspire smart solutions in steel, to strengthen our communities for the future Our Bond Our Customers Our People Our Shareholders Our Local Communities are our partners are our strength are our foundations are our homes Our Strategy T
Slide 5: Sustainability at BlueScope
SUSTAINABILITY AT BLUESCOPE BlueScope’s five key sustainability outcomes: FY2024 Sustainability Reporting Suite (click link to access) Sustainable growth and transformation Safe, healthy and inclusive workplaces Responsible products and supply chains Climate action and environment Strong communities
Slide 6: Agenda
AGENDA 1 Health and Safety 2 Climate Strategy, Performance and Approach 3 Decarbonisation Pathway and Enabler Update 4 Climate Projects and Actions 5 Summary and Q&A
Slide 7: Key Headlines
KEY HEADLINES • Organisational-wide refocus • FY2024 steelmaking emissions intensity Safety • Ensuring leaders spend time to support in line with 2030 target level teams to deliver improvement • Installation of NZ EAF1 progressing well • Progressing ESF2 pilot study for Pilbara ores with Rio Tinto a
Slide 8: Health and Safety
Health and Safety ie ae ee a vil
Slide 9: Health and Safety Approach
HEALTH AND SAFETY APPROACH Safe and healthy workplaces are integral to the way we do business • Strong foundations in risk management due to long standing behavioural based safety approach • Recently embedded a people-centred approach – Fosters a culture of learning and empowerment – Focuses on inno
Slide 10: Health and Safety Performance and Refocus
HEALTH AND SAFETY PERFORMANCE AND REFOCUS Strong performance in lead indicators; lagging indicators driving need for refocus on basics Lead indicators Refocus on Safety program 100% • FY2024 saw a disappointing increase in TRIFR of planned HSE risk control projects completed in FY2024 (271) – Increa
Slide 11: Climate Strategy, Performance and Approach
Climate Strategy, Performance and Approach 11
Slide 12: Climate Strategy
CLIMATE STRATEGY Climate action is a key component of our corporate strategy Use quality and cost-effective carbon offsets Reduce our GHG emissions only where direct abatement is not feasible Create carbon-efficient and climate-resilient Making the case for local, sustainable steel solutions Increas
Slide 13: Steel: Critical to the World's Future
STEEL: CRITICAL TO THE WORLD’S FUTURE A foundation for global decarbonisation; underpins the renewable energy transition and the circular economy Steel is a critical enabler of the energy transition1 Steel is central to a circular economy Importance given its strength, durability and recyclability L
Slide 14: Collaboration is Core to Our Approach
COLLABORATION IS CORE TO OUR APPROACH BlueScope is a small part of an enormous industry, and is working across its value chain to progress the decarbonisation of its operations and industry Collaborating with: Raw material Global Energy Certification & Industry Research and suppliers steelmakers pro
Slide 15: Continuing Work in Pursuit of Our Targets
CONTINUING WORK IN PURSUIT OF OUR TARGETS Making solid progress towards our 2030 targets and 2050 net zero goal1 Steelmaking target2,3 Non-steelmaking target4,5 (92% of Group-wide Scope 1 and 2 emissions) (<8% of Group-wide Scope 1 and 2 emissions) • 12% reduction since FY2018, in line with 2030 tar
Slide 16: Steelmaking Site Emissions Intensity
STEELMAKING SITE EMISSIONS INTENSITY All sites driving emissions intensity improvements; gains are lumpy and progressively harder Scope 1 & 2 GHG emissions intensity1 (tCO2-e/t raw steel produced) 3.5 Emissions Intensity Reduction Baseline year for group-wide 2030 steelmaking target Since FY2013 Sin
Slide 17: Further Refined Our Scope 3 Analysis
FURTHER REFINED OUR SCOPE 3 ANALYSIS BlueScope’s largest source of Scope 3 emissions face the same challenge in decarbonising iron and steelmaking; working to understand and identify ways to reduce Scope 3 emissions FY2024 GHG Emissions (mt) FY2024 Scope 3 Profile 22.6 • 34% of Scope 3 emissions fro
Slide 18: Refreshed Scenario & Physical Analysis
REFRESHED SCENARIO & PHYSICAL ANALYSIS Updated scenario analysis to ensure resilience of business strategy and portfolio against transitional and physical climate change impacts Scenario overview • Assessed implications for BlueScope under four refreshed scenarios – Analysis indicates that the curre
Slide 19: Decarbonisation Pathway and Enabler Update
Decarbonisation Pathway and Enabler Update 19
Slide 20: Steelmaking Decarbonisation Pathway
STEELMAKING DECARBONISATION PATHWAY Highlights the dual-stream approach to steelmaking decarbonisation through both the near-term asset optimisation and longer-term technology evolution Emissions Optimising current operating assets1 Technology evolution pathways baseline Direct reduced iron Energy a
Slide 21: Midstream Decarbonisation Pathway
MIDSTREAM DECARBONISATION PATHWAY Pathway reflects the fact that over 50% of midstream GHG emissions are from electricity; access to renewable energy is critical to decarbonisation Emissions Pathway to achieve 2030 Pathway to achieve 2050 net zero goal baseline non-steelmaking target1 Enablers requi
Slide 22: Enablers of Steel Decarbonisation
ENABLERS OF STEEL DECARBONISATION Steel industry decarbonisation will be enabled by: Development and diffusion of ironmaking technologies to viable Technology evolution and commercial scale ‘Cracking the code’ Access to appropriate quality and sufficient quantities of Raw materials supply economic r
Slide 23: Technology Evolution
TECHNOLOGY EVOLUTION Development and diffusion of ironmaking technologies to viable and commercial scale unlikely to be the rate limiter of the iron and steelmaking transition Why is this enabler important? Recent progress ✓ Well progressed in installing NZ EAF Global steelmaking is dominated by BFs
Slide 24: Raw Materials Supply
RAW MATERIALS SUPPLY Access to appropriate quality and sufficient quantities of economic raw materials largely depends on location and technology Why is this enabler important? Recent progress Insufficient global scrap supplies for EAFs to ✓ Signed a scrap supply contract for NZ EAF, replace BF redo
Slide 25: Firmed, Renewable Energy
FIRMED, RENEWABLE ENERGY Access to internationally cost-competitive, firmed large-scale renewable energy critical for Scope 2 emissions reduction and future Green Hydrogen industry Why is this enabler important? Recent progress Iron and steel production requires significant ✓ Signed renewable energy
Slide 26: Hydrogen and Natural Gas Availability
HYDROGEN AND NATURAL GAS AVAILABILITY Availability of competitively priced green hydrogen, with natural gas enabling the transition natural gas plays a critical role, supply is challenged in Australia Why is this enabler important? Recent progress Green H2-DRI1 has potential to produce ~85% less ✓ P
Slide 27: Policy Support
POLICY SUPPORT Supportive and consistent policies across all these enablers to underpin decarbonisation; advocating for policy that: • Enables supply of natural gas at internationally competitively prices in Australia Natural gas • Prioritises domestic industrial users and highest abatement uses Ren
Slide 28: Climate Projects and Actions
Climate Projects and Actions 28
Slide 29: Solid Pipeline of Climate Projects
SOLID PIPELINE OF CLIMATE PROJECTS We continue to make good progress towards our 2030 targets and 2050 net zero goal by optimising existing assets in the near term and pursuing longer-term iron and steelmaking transformation Climate Project Pipeline1 (number of projects) Optimising existing assets S
Slide 30: New Zealand Steel Electric Arc Furnace
NEW ZEALAND STEEL ELECTRIC ARC FURNACE Securing the future of steelmaking in NZ • Expected cost ~NZ$300 million – NZ$140M contribution from the New Zealand Government GIDI fund • Expected to be operational by 2026 • Design phase has identified the potential to reduce Glenbrook’s Scope 1 and 2 emissi
Slide 31: Australian DRI Options Study
AUSTRALIAN DRI OPTIONS STUDY Progressing study of Australian DRI technology pathways and their necessary enablers Objectives 1 Raw Materials Ironmaking Steelmaking Identify most appropriate DRI ironmaking Blast Furnace Blast Furnace Basic Oxygen location and technology options grade iron ores Furnac
Slide 32: Partnership with Rio Tinto and BHP
PARTNERSHIP WITH RIO TINTO AND BHP Working together to unlock ironmaking decarbonisation using Pilbara ores Objectives Raw Materials Ironmaking Steelmaking • Focus on developing ESF technology Blast Furnace Blast Furnace Basic Oxygen – Potential to unlock emissions intensity reduction of grade iron
Slide 33: Technology Collaborations with Global Steelmakers
TECHNOLOGY COLLABORATIONS WITH GLOBAL STEELMAKERS Working with leading global steelmakers to develop low emissions technology pathways • Technology collaborations with Tata Steel Europe, thyssenkrupp Steel Europe and POSCO • The complex and unique nature of the steel supply chain lends itself to the
Slide 34: Capital Allocation
CAPITAL ALLOCATION Capital Allocation Framework supports investment in pursuit of our decarbonisation goals Capital allocation approach Forward looking focus areas • In FY2021, announced up to $150M over five years to • Collaboration with Rio Tinto and BHP may support 2030 targets and long-term deca
Slide 35: Examples of Steelmaking Projects
EXAMPLES OF STEELMAKING PROJECTS Optimising our existing steelmaking assets Torpedo lid trials at PKSW Upgrades to the plate mill Increased scrap at Glenbrook furnace at PKSW • Commenced installation of a new Plate Mill furnace • Expected to improve emissions intensity of furnace by ~40% • Commissio
Slide 36: Examples of Non-Steelmaking Projects
EXAMPLES OF NON-STEELMAKING PROJECTS Significant number of projects across our broader footprint of non-steelmaking assets Western Port paint line upgrade Heat recovery at Rancho NS BlueScope solar projects Cucamonga paint line • Upgrading equipment and controls to recover and reuse heat • Currently
Slide 37: Summary
Summary 37
Slide 38: Key Headlines
KEY HEADLINES • Organisational-wide refocus • FY2024 steelmaking emissions intensity Safety • Ensuring leaders spend time to support in line with 2030 target level teams to deliver improvement • Installation of NZ EAF1 progressing well • Progressing ESF2 pilot study for Pilbara ores with Rio Tinto a
Slide 39: A Resilient Business Delivering Returns Through the Cycle
A RESILIENT BUSINESS DELIVERING RETURNS THROUGH THE CYCLE Diversified business delivering quality through-cycle earnings – Leading positions in Australia and NZ; best-in-class steelmaking in the US – Suite of premium branded products and solutions that enhance margins Performance underpinned by qual
Slide 40: Questions
Questions 40
Slide 41: BlueScope ESG Webinar
BlueScope ESG Webinar Mark Vassella Managing Director and Chief Executive Officer David Fallu Chief Financial Officer Gretta Stephens Chief Executive, Climate Change and Sustainability 19 September 2024 Pictured: North Wollongong Surf Club in BlueScope Steel Limited. ASX Code: BSL NSW, featuring SUP