BlueScope jumps on outlook

Steel firm continues efforts to move past steep 2011, 2012 losses.

BlueScope Steel says it is on track to post a $49 million half year underlying profit as it continues to put the horrors of $1 billion-plus losses in 2011 and 2012 behind it.

The company has forecast an underlying profit in the six months to December 31 similar to the $49 million result it achieved in the six months to June 30.

The company's shares shot up 31 cents, or 6.2%, to $5.29.

BlueScope said its expensive transformation is working involving an enforced move away from steelmaking into higher value-added steel building products, as well as selling into and operating in Asia.

Its Australian business returned to underlying profit last year, slashing net debt to below $200 million, after collecting $571 million through a steel coated products business joint venture with Japanese giant Nippon.

"The transformation of our business through restructuring, cost reduction programs, prudent capital management and strategic investments has positioned us well for future growth," chief executive Paul O'Malley told BlueScope's annual general meeting.

More than 90 per cent of BlueScope's shareholders voted in favour of the board's remuneration report, which included a 3% pay rise and bonuses for top executives, including Mr O'Malley, following a three-year pay freeze.

The chief executive also received a $1 million-plus bonus as his salary package jumped to $5.1 million from $2.8 million.

A year ago the company slashed bonuses and cut his pay to avoid a repeat of a damaging shareholder protest vote that occurred in 2011.

Shareholders have not received a dividend for three years.

Mr O'Malley was awarded his latest bonues because he had met targets, including on underlying profit, and the crucial joint venture with Nippon.

The company has not actually returned to reported profits however, with 2012/13 $84 million loss due to ongoing restructuring costs.

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