Managing Director & CEO Update 2009 Annual General Meeting

Transcription

1 Managing Director & CEO Update 2009 Annual General Meeting Paul O Malley, Managing Director and Chief Executive Officer 12 November 2009 ASX Code: BSL

2 Very good safety performance

3 LTIFR and MTIFR FY Lost Time Injury Frequency Rate 70 Medically Treated Injury Frequency Rate Lost time injuries per million man-hours worked Medically treated injuries per million man-hours worked FY FY Includes Contractors from 1996 Includes Butler from May 2004 Includes 2007/8 acquisitions Includes acquisitions for FY 07/08 Includes Contractor from 2004 Includes Butler from May 2004 Includes 2007/8 acquisitions Includes acquisitions for FY 07/08 Page 3

4 BlueScope Distributions safety performance - pre and post acquisition Lost Time Injury Frequency rate Medically Treated Injury Frequency rate /00 00/01 01/02 02/03 03/04 04/05 05/06 06/07 07/08 08/09 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07 07/08 08/09 Post Acquisition (August 2007) Page 4

5 Tony Brown, Michael Carr and Paul de Bruyn 3 of several Western Port employees who volunteer with the CFA and SES

6 BlueScope s contribution to Victorian Bushfire Recovery Program $140,000 from employee donations $ 1 million in steel building products Overalls, clothing and volunteers Page 6

7 BlueScope Steel supports communities around the world Page 7

8 Responding to environmental issues. Page 8

9 Steel - most recycled material in the world Page 9

10 US Coast Guard Mobil, Alabama, USA Page 10

11 Ara Winery, Marlborough, New Zealand Page 11

12 Armed Forces Development Command, Bangkok, Thailand Page 12

13 BlueScope has invested $500 million towards environmental projects globally Western Port, Victoria Page 13

14 14 billion litres recycled water used in Port Kembla s steelworks since 2006 Western Port recycling project will cut fresh water use by 65% Page 14

15 Australia s Carbon Pollution Reduction Scheme (CPRS) BlueScope committed to reducing its CO 2 emissions Participating in research for new, lower carbon steelmaking technologies to reduce emissions CPRS must not damage BlueScope Steel s international competitiveness Two major concerns still to be addressed by the CPRS: Level of permit allocation Reassurance about approach to Scope 3 emissions Page 15

16 A co-generation plant at PK Steelworks would be one of the largest GHG abatement projects in Australia. Would offset 1 million tonnes of GHG yearly = removing nearly 200,000 cars off the road annually. Page 16

17 Australia s Carbon Pollution Reduction Scheme (CPRS) Government incentives needed for large-scale abatement projects Current CPRS will not provide an incentive Current CPRS must be amended so it does not impair our international competitiveness Page 17

18 $295 million cost savings in 9 months Flexible work practices saved BlueScope jobs Production volume related costs lowered: - China and Vietnam coated by ~ 40% - USA Butler by 18%; Varco Pruden by 35% Reduced value of inventory on hand from $2.8 billion to $1.7 billion Capital expenditure significantly curtailed apart from No 5 BF reline and Sinter plant upgrade projects Restructured debt facilities; raised additional equity funding; gearing was reduced to under 12% Page 18

19 Outlook for the global steel industry Page 19

20 Aug October 2009 Page 20 Jul-09 China leading the recovery % Monthly Crude Steel Production (y-o-y%) Jan-08 Feb-08 Mar-08 Apr-08 May-08 Jun-08 Jul-08 Aug-08 Sep-08 Oct-08 Nov-08 Dec-08 Jan-09 Feb-09 Mar-09 Apr-09 May-09 Jun-09 US EU (27) China India Asia ex. China & India S.America Middle East C.I.S. China Middle East India Asia (excl China/India)

21 China GDP rebounded from 6.1 % in 1 st quarter to 8 % in 2 nd quarter 2009, mainly due to its Government economic stimulus package Page 21

22 From 2009/2010, new projects to increase both railroad and expressways by around 20,000 km each Page 22

23 A buoyant China helps Australia s economy which improves domestic steel demand Page 23

24 Page 24

25 An Excellent Reference List of Over 2,000 Projects Page 25

26 India will increasingly become an important market for Australia Our first rollforming and PEB facility - Pune, India Page 26

27 Trading conditions and outlook Outlook for the global steel industry Waiheke Island, New Zealand Page 27

28 Australia No 5 Blast Furnace reignited 19 August Both furnaces now running 100% capacity Domestic markets recovering and expect: - Residential moderate growth to continue - Non-residential to remain depressed Export demand improving Subject to demand, intend running both furnaces at 100% into third quarter International prices moderated; Domestic prices likely to reduce in 3 rd Q New Zealand Domestic despatches not yet recovered; partly offset by export despatches Page 28

29 North America Non-residential construction segment remains weak North Star BlueScope margins challenging Asia Positive results for all countries in 1 st quarter In South East Asia demand remains generally strong Looking to finish Indonesia s 2 nd coating and painting line Resuming production on Thailand s 2 nd metallic coating line China coated business keeps improving; Buildings and Lysaght businesses have good order books Page 29

30 Outlook for 1 st half FY2010 Some positive developments but remain cautious Continue to expect to post a small loss for the 1 st half year Further update provided at half year results in February 2010 Page 30

31 BlueScope Steel well placed for the recovery Interventions taken early and swiftly Due to support from shareholders, customers, employees and management. Page 31