BlueScope Steel Ltd., Australia’s largest steelmaker, reported a smaller net loss in the first half in part because of lower materials costs.
The net loss narrowed to A$12 million ($12.4 million) in the six months ended Dec. 31 from A$530 million a year earlier when it had restructuring costs, the Melbourne-based company said today in a statement. Credit Suisse Group AG had expected BlueScope to book a loss of A$4 million for the period.
BlueScope has stopped most exports from Australia, shut a mill and a furnace and shed about 1,000 jobs in the past two years to cut costs as a stronger Australian dollar, higher labor expenses and lower steel prices hurt profit. The company, which booked A$1.04 billion of losses in the year ended June 30, in August agreed to sell half its coated-steel operations in Southeast Asia and North America to Nippon Steel & Sumitomo Metal Corp. to pay debt.
“This improvement comes on the back of strong cost management and despite dumped imports and some softening of domestic volumes” for its Australian coated and industrial products business, BlueScope said in today’s statement. “We expect a continued improvement with a small underlying net profit after tax” in the second half subject to domestic demand, margins and foreign exchange rates.
The company today reported an underlying profit of A$10 million in the first half, exceeding its own guidance for an underlying loss approaching break even.
BlueScope fell 0.5 percent to A$3.77 in Sydney trading when it last traded on Feb. 15. The stock has risen 9.3 percent so far this year compared with an 8.3 percent gain for the S&P/ASX 200 index.
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