BlueScope Profit Drops 90% After A$439 Million U.S. Impairment

BlueScope Steel Ltd. reported a sharp deterioration in earnings as writedowns and weaker steel prices offset cost-cutting efforts. Net profit for the year ended 30 June slumped 90% to A$83.8 million after the company booked a A$438.9 million impairment on its North American metal-coatings business, acquired for US$500 million three years ago. Underlying profit, which strips out one-off items, fell 51% to A$420.8 million, missing Visible Alpha’s consensus estimate of A$466 million. Management blamed a global glut of steel capacity, higher raw-material costs and what Chief Executive Officer Mark Vassella described as a "maze" of U.S. tariffs that has sapped customer demand and muddied supply-chain planning. BlueScope’s North America division—normally its biggest earner—saw underlying earnings drop 45% to A$514.4 million as selling prices softened. The Sydney-listed shares fell as much as 7% after the results before trimming losses to about 5% by late afternoon. Looking ahead, the company guided to underlying first-half operating earnings of A$550 million to A$620 million, up from A$309 million a year earlier but below the midpoint of analyst forecasts. BlueScope declared an unchanged final dividend of 30 Australian cents per share and said it is reviewing alternative substrate supply options to mitigate future tariff exposure.