Raw material costs in iron ore and pellet are up 100% from last year, BSL raw material costs down 75% from 2009.
This would roughly equate to a 60% drop in the volume of raw material processed from 2009 (and hence output). BSL's poor performance might not be all strong AUD oriented, but it would be killing exports. It looks like demand for steel locally is still in a coma with the biggest revenue hits due to poor US sales.
In terms of management, if they can't do anything about market share (expanding Asia demand??), then they had better be doing something about margins (globally).
From the 2010 financials, it looks like BSL is trading at tangible assets, suggesting this might be a nice level to enter at. If the world steel demand picks up from here, that would be nice.
Closing below $2.05 might be part of a bigger problem, not just locally.
BSL Price at posting:
$1.81 Sentiment: None Disclosure: Not Held
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