Bluescope Steel lowers earnings guidance on back of weaker US steel margins

Company News

by Anna Napoli

BlueScope Steel (ASX:BSL) has lowered its 2019 financial year underlying earnings (EBIT) guidance to $1.35B, which is 6 per cent higher than the year earlier period but is below previous guidance of a 10 per cent increase versus FY18.

The decrease is due to lower than expected steel margins at its North Star operations in the US and a softer than expected building products market in Asia and North America.

The company says other businesses are performing generally in-line with the expectations set out in the February guidance, with Australian Steel Products seeing stronger realised steel spreads offset by weaker than expected domestic volumes.

BlueScope says it continues to generate strong cash flow and will extend the current $250 million on-market buy-back program by a further amount of up to $250 million, as part of its capital management program.

Shares in Bluescope Steel (ASX:BSL) closed 5.27 per cent lower at $11.14 yesterday.