Bluescope Steel Limited · ASX:BSL
Bluescope Steel — Merger or Acquisition (February 2004)
32 slides from Bluescope Steel's merger presentation, Feb 16, 2004
Slide 1: Presentation to Investors: Acquisition of Butler Manufacturing
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Slide 2: Acquisition Cost
Acquisition Cost AUD:USD exchange rate of 0.785 16 February 2004 2
Slide 3: Implementing BlueScope Steel's Strategy
Implementing BlueScope Steel’s Strategy }Hy Gin BLUESCOPE Acquisition of Butler Manufacturing Company - Pre-eminent global designer/supplier of Pre-Engineered Buildings (PEBs) ~- Number One positions in North America and China - Worldwide brand recognition An Attractive Opportunity at the Right Time
Slide 4: Fully designed and engineered building
Fully designed and engineered building Comprising steel structural frame and roofing systems, typically with steel walling Butler is THE PEB company Design, Engineering, Manufacturing, Sales & Marketing 16 February 2004 4
Slide 5: Cost Effectiveness, Broad Application
Cost Effectiveness, Broad Application Why PEBS? Speed 16 February 2004 §
Slide 6: Revenue up nearly 20%
Revenue up nearly 20% Downstream Revenue proportion up 7% Employees up 39% Gearing up 8% — Investment Grade Balance Sheet Maintained 16 February 2004 6
Slide 7: Butler Consolidated Financial Overview
Butler Consolidated Financial Overview 796.2 (6.0%) (6.7%) (2.7%) 66.9 52.4 28.0 19.0 7.2% 6.0% 3.4% 2.4% 51.3 34.3 9.1 (0.3) 2003 Revenue by Business 2003 Gross Profit by Business North American Buildings North American Buildings Vistawall Normalised resutts reflect exclusion of divested European o
Slide 8: Business Unit Performance
Business Unit Performance (17.0) Established 1901 In operation 8 years Acquired 1984 #1 #1 #2 Turnaround Strong, growing business Robust business Notes 1. North American Buildings includes BUCON and Real Estate 2. Normalised resuits reflect exciusion of divested European operations, changes to emplo
Slide 9: North American Buildings Group Profile
* Core business capability - design, manufacturing and marketing of pre- engineered steel buildings and component systems . Non-residential building market focus — industrial, commercial, retail segments - Manufacturing, Distribution Centres, Warehouses, Showrooms ° #1 in PEBs in North America (~18%
Slide 10: North American Buildings Group Profile (2)
_ North American Buildings Group Profile (2 Showroo 16 February 2004 10
Slide 11: China Profile
ChinaProfile(1) * Core business capability - design, manufacture and market pre- engineered steel building systems ¢ #1 in PEBs in China * Strong, well recognised brands * Strong revenue and profit growth - 41% and 25% growth from 2002 to 2003 * Customers include major multi-nationals and leading Ch
Slide 12: Customer base includes
Customer base includes + Major Multinationals + Leading Chinese firms High quality PEBs * Also incorporating Vistawall systems Other China customers: + 3M + Energizer * Motorola + Nike * Orient Home * Carrefour 16 February 2004
Slide 13: NE TEASE Maia heap ase ayes
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Slide 14: Vistawall Profile
istawall Profile(1) = Core business capability - Design, manufacturing and marketing of extruded aluminium and glass roof, wall, door & window systems for non-residential buildings #2 in this market Strong, well recognised brands - Vistawall, Naturalite, Moduline, Skywall Market focus is office and
Slide 15: Vistawall Profile (2)
Vistawall Profile (2) Naturalite a - Moduline _ “a Engineered Skylights 16 February 2004 16
Slide 16: Butler acquisition - Good Deal
Butler acquisition - Good Deal Acquisition cost Less than 8% of US$204m (A$260m) Enterprise Value Bolt-on Acquisition 16 February 2004 16
Slide 17: Operations we know, understand and can grow/improve
Operations we know, understand and can grow/improve * Consistent with our Strategy - Downstream, Value Added — Branded Products Building and Construction Solutions * Continuing Asian growth + Within our geographic footprint * Compatible culture 16 February 2004 7
Slide 18: Strategic fit - Adding revenue and margin
_ Strategic fi fit — Adding revenue: and margin and > Metallic Lo _ Coates d 7 16 February 2004 18
Slide 19: Strategic fit - Contributing to our goal of moving downstream
Strategic fit- - Contributing to our goal of moving downstream - _ 0 Billion i Downstream Velie Danes ales _ BlueScope Steel Revenue (incl Butler in proforma 02/03) A$6.3B A$5.3B Metal Coated Coil, 62% Painted Coil, 55% Rollformed Components CRC |__ HRC Slab / 2002/2003 Proforma 2002/2003 (including
Slide 20: Strategic Fit - Both BlueScope Steel & Butler have strong brands
Strategic Fit - Both BlueScope Steel & Butler have strong brands BLUESCOPE STEEL Colerbond = [YSAGHT Le Colerbond Zincalume coloresreaigey Galvaspan Galvabond’ PrimaMaju ss PrimmaDesa’ Xlerplate ——- Xl=Ercoil MR-24® Roof System VISTAWALL © Architectural Products Butlerib® Il Wall System Liberty Buio
Slide 21: Strategic Fit - BlueScope Steel complements Butler
th it Wi ryf nt i ita pri t o ° 'S ® F pl S Steel’ a com pe has co er utl BlueS B Fit gic Strate © BlueScope Steel e Butler 24 16 February 2004
Slide 22: BlueScope Steel and Butler facilities
BlueScope Steel Y= Lysaght manufacturing facilities © Lysaght sales offices 4 Coated/painted steel sales offices Butler %* =~ PEB manufacturing facilities @ District sales offices (and regional sales managers for 27 regions) 16 February 2004 22
Slide 23: Right Timing
Right Timing Available due to Butler’s financial constraints * Bottom of USA building and economic cycle Paid at current market share price * Exchange rate Market benchmarks 16 February 2004 23
Slide 24: Right Timing - Leading indicators of industrial production
_ Right ae Leading indicators ofindustrial _production suggest upturn j in USA | OECD Leading Indicator & Industrial Production 10} 12 ? 10 s 54 é x 6 x 3 4 : Es Zo $ 0 : E — < “2 ie < 5 +4 s = 5} 6 E 2 © Industrial Production © 40) U.S. rose sharply in November 2003, up 11.7%. -10 12 Nov-98 Nov-99
Slide 25: Right Timing - PEB market improvement potential
_ Right Timing - PEB market improvement potential USA GDP Growth vs PEB Market Size PEB Market Size US Real GDP: 1980-2008f (US$ Billion) {USS$B At 1996 Prices) 7 12,000 + 10,000 GDP Growth + 8,000 157 + 6,000 1.07 Fr 4,000 PEB Market 0.5 | + 2,000 +—+—_+—_+—+4 ) 1988 1990 1992 1994 1996 1998 2000 2
Slide 26: Value creation opportunities
Value creation opportunities ; * Significant opportunity for value creation via leveraging - BlueScope Steel and Butler strengths, capabilities and market positioning * Initial regional focus for value creation — North America Business Transformation and Turnaround - China Immediate Scale and Signif
Slide 27: Management Structure and Accountabilities
Management Structure and Accountabilities | ¢ BlueScope Steel Executive Leadership Team - Extensive North American experience * North America - Lance Hockridge — President Industrial Markets including North Star BHP Steel and Castrip™ ¢ China/ South East Asia - Mike Courtnall - President Asian Build
Slide 28: Value Creation via margin improvement potential
_ Value Creation via margin improvement potential — 2003 . Comparables | Enterprise value 204 744 Net Sales 796 898 Enterprise value / Net Sales 0.26 0.83 3 year average gross margin (2001-03) 14% 22% 16 February 2004 28
Slide 29: Value creation - China, SE Asia and Australasia
"Value creation - China, SE Asia and Australasia. Butler China * Growing profitably * Provides immediate scale * Synergy from combining Lysaght and Butler capabilities * Creates absolute leader in China in PEBs and steel building components * Resource for growth SE Asia and Australasia * Leverage Bu
Slide 30: Expected EPS outcome
Expected EPS outcome — FY05 Breakeven — FY06 Accretive * 100% debt funding Increase in gearing by 8% Preserving our capacity to simultaneously - Reward shareholders - Grow 16 February 2004 30
Slide 31: Strong strategic fit, right timing, value creation
* Strong strategic fit * Right Timing * Value creation and growth opportunities ag 3 @ Month Annualised % Chang: 4 oO ° o industrial Production Nov-88 Nov-99 Nov-00 Nov-01 Nov-02 Nov-@ 16 February 2004 34
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