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BlueScope Steel reports 27% fall in first-half profit amidst market volatility

As expected, steelmaker BlueScope Steel (ASX:BSL) experienced a 27% decline in first-half profit due to volatile market conditions, sluggish economic growth, and high inflation and interest rates.

Directors anticipate another period of lower earnings in the current June half, albeit possibly not as significant as the previous December half.

Despite this outlook, BlueScope maintained an interim dividend of 25 cents per share, unchanged from the previous year.

Statutory net profit after tax totaled $429.3 million for the six months ending in December, down from $599 million a year ago. Revenue from continuing operations also decreased to $8.59 billion from $9.36 billion in the same period last year, falling short of market expectations.

CEO Mark Vassella emphasized the underlying EBIT figure of $718 million for the half, a 16% decrease from the previous year. He acknowledged the global economic volatility but highlighted BlueScope’s resilience and robust balance sheet.

Vassella outlined progress on key projects, including the ramp-up of North Star in the US, Blast Furnace reline in Australia, and the installation of an Electric Arc Furnace at New Zealand Steel.

BlueScope reaffirmed its commitment to shareholder returns, with $306 million returned to shareholders in the December 2023 half. The company announced an interim dividend of 25.0 cents per share and an increase to the share buy-back program.

The full-year dividend will be determined based on business growth, reduced share count, and the macroeconomic and industry outlook.