Smorgon's profits strong on healthy scrap market

Smorgon’s profits strong on healthy scrap market

Australia's third largest steelmaker and metals recycler, Smorgon Steel Group Ltd., announced a 76.9 percent year-on-year increase in net profit thanks to a stronger scrap market. Smorgong's net profit after tax for the fiscal year ended June 30, 2005, increased 76.9 percent year on year to a record $77.3 million. The company commissioned its new shredder in May 2005. The new shredder produces high quality shredded feedstock for the company's Waratah steel mill. Ray Horsburgh, Managing Director and CEO of Smorgon Steel, said that he did not foresee see any weakness in demand. He expects Australia's activity levels in engineering, non-residential construction and mining production to be healthy in during the 2005/6 fiscal year. Horsburgh also indicated that the company would try to make more profit on scrap operations, especially through increasing its activities in China, India and Brazil. The company plans to spend up to $60 million on a scrap metal business in China during the 2005/6 fiscal year.