Bluescope Steel Limited · ASX:BSL
Bluescope Steel — Corporate Update (October 2008)
19 slides from Bluescope Steel's corporate update, Oct 30, 2008
Slide 1: Beyond the short term
For personal use only “Beyond the short term” Conference call with BlueScope’s Managing Director & CEO Paul O’Malley, Managing Director and Chief Executive Officer 30 October 2008 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: BlueScope continues to pursue a strategy to maximise value and preserve financial flexibility
For personal use only BlueScope continues to pursue a strategy to maximise value and preserve financial flexibility Page 3
Slide 4: BlueScope is an outstanding business…
BlueScope is an outstanding business… 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 Product
Slide 5: The Blueprint is our tool for focusing on the key performance drivers…
The Blueprint is our tool for focusing on the key performance For personal use only drivers… KPI Extract: Australia/New Zealand Blueprint Basic Key Performance Indicator Rationale Profit weighted share of steel market and 1. Increase growth Customer Steel penetration in building and Key controll
Slide 6: With further detailed initiatives to improve cashflow & earnings…
With further detailed initiatives to improve cashflow & earnings… For personal use only Key Action Item R&M & Capex Significant reduction / slow down & deferral with focus on Î maintaining operational performance. Constrain growth capital. Working capital Î Relentless focus on Blueprint KPI basics o
Slide 7: Balance Sheet – Gearing remains strong…
Balance Sheet – Gearing (net debt to net debt + equity) remains For personal use only strong… 50% Currently expect gearing to be 40% within target 40% range as at 31 35% 32% December 2008 Target 30% Range 30% 20% 10% Dec 31 2007 Feb 1 2008 June 30 2008 Page 7
Slide 8: Debt maturity profile significantly improved…
Debt maturity profile significantly improved…with sizeable For personal use only committed and undrawn lines available PRE REFINANCING POST REFINANCING 2,000 2,000 1,800 1,800 1,600 1,600 AUD$M 1,400 1,400 1,200 AUD$M 1,200 1,000 1,000 800 800 600 600 400 400 200 200 0 0 FY FY FY FY FY FY FY FY FY F
Slide 9: Industry Overview
For personal use only “Industry Overview” Page 9
Slide 10: Long term growth in steel demand…
Long term growth in steel demand… For personal use only APPARENT CRUDE STEEL CONSUMPTION (mtonnes) +57% 1,400 1,330 1,300 24 53 1,200 55 +47% 1,100 1,074 20 33 1,000 37 428 900 847 +17% +44% Brazil 18 297 Russia 800 29 30 +115% 114 India 700 138 China 600 124 133 +3% 185 US 500 -1% 166 West’n Eur (E
Slide 11: …with demand underpinned by urbanisation in China...
…with demand underpinned by urbanisation in China... For personal use only Rural population (thousands) Urban population (thousands) 1,500,000 China : Total Population (000’s) 1,250,000 1,000,000 750,000 500,000 250,000 0 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 202
Slide 12: …and steel intensity likely to increase
…and steel intensity likely to increase For personal use only CRUDE STEEL INTENSITY Kg/capita Taiwan 1,200 (1970–2006) 10 to 15 South Korea 1,000 (1970–2006) more years of 800 strong Japan growth in 600 China (1955–2006) China (1970–2006) USA until steel 400 (1900–2006) intensity 200 curve flattens
Slide 13: Domestic demand is a key to GDP growth in China
Domestic demand is a key to GDP growth in China For personal use only 30 Composition of GDP Net Exports Inventories CY 2008 could be viewed as 24 “PAUSE” as opposed to a “CLIFF” ¾ credit tightening to reduce Investment inflation (RMB Trillions) 18 ¾ Olympics – material driver of economic slowdown
Slide 14: Business Update and Outlook
For personal use only Business Update and Outlook Page 14
Slide 15: Underlying Consolidated NPAT - a strong first quarter / challenging second half
BlueScope Steel – Underlying Consolidated Net Profit After Tax For personal use only (NPAT) - a strong first quarter / challenging second half 1Q FY 2009 (vs 2H FY08) Underlying NPAT Principal drivers: 600 Higher global US$ export steel prices 511 Improved earnings contribution from recent acqui
Slide 16: Business outlook - 2H FY2009 & FY2010 onwards
Business outlook - 2H FY009 & FY2010 onwards For personal use only 2H – FY2009 FY2010 Onwards Lower steel spread (vs 1H09) Expected improvement in spread due to: BF No.5 reline and sinter plant upgrade ¾ higher steel prices and demand will proceed on schedule (March – June relative to 2H FY200
Slide 17: Summary
For personal use only Summary Page 17
Slide 18: Summary…
Summary… For personal use only BlueScope is an outstanding company ¾ diversified business ¾ low cost producer ¾ strong brand & customer reach Operating today in a challenging environment Well positioned to be successful beyond the short term on the back of renewed growth in the developing worl
Slide 19: Beyond the short term
For personal use only “Beyond the short term” Conference call with BlueScope’s Managing Director & CEO Paul O’Malley, Managing Director and Chief Executive Officer 30 October 2008 ASX Code: BSL