Australian steelmaker BlueScope Steel has announced that it expects its underlying earnings before interest and tax (EBIT) for the six months ending December 31 to be around A$460 million, compared with the prior guidance of AU$420 million reported in August.
According to BlueScope, following a strong November performance, the increase in the guidance is mainly due to higher steel prices and domestic sales volumes, a higher contribution from export coke of approximately AU$20 million and improved productivity at its Australian Steel Products division.
BlueScope also stated that, across the rest of its portfolio, its subsidiaries North Star BlueScope, New Zealand and Pacific Steel and North America Buildings are expected to deliver performances generally in line with prior guidance.
Meanwhile, the company has also noted that the US Congress has voted to approve the tax reform package and it is anticipated that the US president will sign it into law. BlueScope has extensive operations in the US, in North Star BlueScope, BlueScope Buildings North America and Steelscape. Therefore, the company expects its US earnings will benefit through a lower federal tax rate, with an anticipated seven percent decrease in the current financial year 2017-18 and an 11 percent decrease thereafter.