BlueScope Steel Profit Up 250%

But company expects loss in second half of year

Australia's largest steelmaker BlueScope posted a 250% increase in first-half profit on Feb. 23 but warned the global recession may drive it into the red during the second half.

BlueScope said net profit for the six months to December was 407 million dollars (US$265 million) up from 116 million in the previous corresponding period.

Chief executive Paul O'Malley said the result was driven by a strong first quarter before the global recession dampened demand for steel both in Australia and internationally. "We are also seeing lower international steel prices while still experiencing peak raw materials costs," he said.

O'Malley said the outlook for the second half of the year was weaker than initially anticipated. "Should lower demand and prices, coupled with high raw material prices, continue, we expect to see a negative underlying (profit) contribution in the second half," he warned.

O'Malley said BlueScope was concentrating on maintaining a robust balance sheet, strong liquidity position, disciplined capital expenditure and achieving 150 million dollars in cost savings.

Copyright Agence France-Presse, 2009

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