New Zealand Steel Achieves Record Results

21 February 2005

New Zealand Steel Achieves Record Results

Boosted by record domestic demand in both the residential and non-residential sectors, stronger export demand and higher export prices New Zealand Steel enjoyed its best half-year performance in the history of the business, in the period to December 31, 2004.

Reporting as part of the results of its Australian-based parent company, BlueScope Steel Limited (ASX: BSL), New Zealand Steel generated earnings before interest and tax of NZ$94 million (A$87m), on total sales revenues of NZ$407 million (A$377m). The half-year result exceeded the previous year’s full-year result.

President of New Zealand Steel Bill Jacob said: “The New Zealand Steel team have responded exceptionally well to unprecedented market conditions with record slab steel production (336,000 tonnes) for the six-month period, and a 20% increase in metal coating production following investment in expansion.”

”The safety and environment record at the Glenbrook Mill was also very pleasing with the first ever 12 month period without a lost-time injury to any New Zealand Steel employee. Our ambition to be the cleanest, greenest steel operation in the world is being realised.

“The results demonstrate the strength of the domestic building and construction markets, with our domestic dispatches up 19% for the period to a new record of 161,000 tonnes. Delivery performance to our customers reached 93% on time, which represents continuous improvement to our most important asset – our customers.

“Consistent with the experience of most other exporters, the stronger New Zealand dollar took some edge off this performance, but the strength of the global steel market more than compensated for this. In the face of a global escalation in costs for ironmaking raw materials, our local ironsands mines are a real competitive advantage.

“Our theme around New Zealand Steel is “Living the Future”. Our employees’ dedication and record performances across our operations have reaffirmed the sustainability of New Zealand Steel. It is an excellent result made possible by tremendous support from our parent company – BlueScope Steel, ” Mr Jacob said.

Managing Director and Chief Executive Officer of BlueScope Steel, Kirby Adams, described New Zealand Steel’s performance as “an outstanding team effort”.

“We are particularly pleased with the earnings improvement achieved by New Zealand Steel, which has worked hard over the past few years on a new strategic direction to maximise the potential of the business”.

BlueScope Steel announced earnings before interest and tax for the half-year of A$666m, and a net profit after tax of A$485m. Background New Zealand Steel operates a unique steelmaking process using locally sourced ironsands and coal. The integrated steelworks at Glenbrook produces 650,000 tonnes per annum, and incorporates metallic coating and painting operations. New Zealand Steel is a wholly owned subsidiary of BlueScope Steel Limited.

ENDS

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