profit

MARKET UPDATE
On 21 February, 2011, BlueScope Steel provided the market with profit guidance, as follows: �At the moment we expect to deliver a break-even reported Net Profit After Tax (excluding any Net Realisable Value adjustments) in 2H FY 2011.�
The Company indicated the three key drivers which affected trading in 1H FY 2011: steel prices, raw material costs and exchange rate and said they would continue to be strong influences in the second half.
The Company has just completed a detailed review of business performance to the end of April and our expectations for May and June 2011. It is now expected the second half reported earnings for FY 2011 will result in a small reported Net Loss After Tax (excluding any Net Realisable Value adjustments which, if required, will be determined around the time of releasing the FY 2011 financial results in August 2011).
There have been three major contributing factors. First, the strengthening of the Australian dollar (versus US$), which has had negative effects on steel export sales, on the translation of offshore earnings and on Australian domestic commoditised steel sales (which have an underlying US$ sales price). Secondly, global steel prices which fell in April. Thirdly, demand weakness in the domestic distribution and pipe and tube markets.
Overall, the Asian and North American businesses have performed in line with expectations at the time guidance was provided in February.
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