(Reuters) -Australia’s BlueScope Steel reported a 90% slump in annual profit on Monday, citing an impairment charge at its coated products business and weak performance at its North America operations, sending its shares 7% lower.
Shares of BlueScope, Australia’s biggest steel producer, were down at A$22.55, as at 0018 GMT, their lowest point in more than seven weeks. That compared with the broader benchmark index ASX 200, which was down 0.2%.
BlueScope Steel’s coated products business in its North American division reported an annual loss, pressured by lower volumes and operational challenges, leading to a one-off impairment charge of A$438.9 million ($285.90 million).
“There has been a delay in achieving our expectations of the BlueScope Coated Products business, which we acquired in 2022, and an impairment of A$439 million has been recorded,” the steel producer said.
Its North America division, one of its top profit-generating divisions, posted underlying operating earnings of A$514.4 million in the year ended June 30, down 45% from last year. The drop was primarily due to lower selling prices at its North Star and Buildings and Coated Products North America operations.
As a result, the company’s net profit after tax came in at A$83.8 million ($54.6 million) in fiscal 2025, down from A$805.7 million reported in fiscal 2024.
On an underlying basis, exclusing one-off items, BlueScope’s profit halved from the previous year to A$420.8 million, pulled down by price pressures, lower volumes, and higher costs. The result also fell short of the Visible Alpha consensus estimate of A$466.4 million.
The company forecast underlying operating earnings for first half of 2026 between A$550 million and A$620 million, above last year’s A$309 million, though its midpoint misses the Visible Alpha consensus of A$618 million.
BlueScope declared a final dividend of 30 Australian cents per share, in line with last year.
($1 = 1.5352 Australian dollars)
(Reporting by John Biju in Bengaluru; Editing by Chris Reese, Tom Hogue and Sherry Jacob-Phillips)
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