Strategy
Our Platform for Growth
ALL OF OUR INVESTMENT PROJECTS ARE UNDERPINNED BY A CLEAR STRATEGY. THAT STRATEGY IS TO EARN HIGHER MARGINS AND MORE STABLE EARNINGS BY SELLING A GREATER PROPORTION OF MIDSTREAM AND DOWNSTREAM STEEL PRODUCTS.
At BlueScope Steel, we are proud of our 91 year heritage and the strong foundation it provides for our future. But we are not standing still.
Since our public listing, we have been building on our strengths while changing who we are. In four years, we have worked to reposition the Company from being primarily a steelmaker, to a global provider of steel solutions.
BlueScope Steel is investing over $2 billion to build new plants and grow our markets. Countries such as China and India are among the world's fastest growing economies. As they grow, demand for steel products is growing too.
We are also investing closer to home, to capitalise on growing Australian markets and to feed our growth in Asia.
All of our investment projects are underpinned by a clear strategy. That strategy is to earn higher margins and more stable earnings by selling a greater proportion of midstream and downstream steel products. This applies domestically in Australia and across our global footprint.
Upstream, Midstream and Downstream - What do we mean?
Upstream steel products include steel slab, hot rolled coil and plate. For many steel companies, upstream steel products comprise the majority of their sales. At BlueScope Steel, only about half the upstream products we make are sold to external customers.
The other half is further processed into midstream and downstream products.
Midstream steel products include coated and painted steels, such as ZINCALUME® steel and COLORBOND® steel.
Downstream products include LYSAGHT® steel building products, BUTLER® pre-engineered steel buildings (PEBs), SURELINE® power distribution solutions, and rainwater harvesting solutions such as the THINKTANK® system.
BUTLER® is the market-leading brand of PEBs in North America and China, and was acquired by BlueScope Steel in 2004. Butler designs, manufactures and installs complete steel buildings for a wide range of applications - from warehouses and factories, to office buildings, restaurants and car showrooms.
SURELINE® is an integrated, long-life power distribution solution. Developed in conjunction with the electricity industry, the SURELINE® solution is designed to optimise the performance of steel poles, cross arms and fittings. The range includes SURELINE® steel power poles, which are lightweight and resistant to corrosion and pests.
Our BlueScope Water business provides steel rainwater harvesting, irrigation and stormwater products. The basis for this business is the Company's many years of experience supplying steel products for the manufacture of rainwater tanks. Today, BlueScope Water designs, manufactures and installs WATERPOINT® rainwater tanks made from corrugated AQUAPLATE® steel, with a food grade polymer liner to provide healthy and clean-tasting water.
BlueScope Water also provides the HYDRORIB® pipe system - a unique ribbed profile pipe made from a steel composite material. HYDRORIB® is lightweight, strong and easy to install. The steel composite material increases resistance to corrosion and abrasion, and offers outstanding performance over a long service life.
These and other steel products are supplied to customers across Australia and around the globe.
Rebalancing our Portfolio
Historically, the steel industry has been cyclical. Prices for steel products - especially upstream commodity steel products - have fluctuated according to changing market conditions, often quite rapidly. Accordingly, the profitability of many steel companies has also been volatile.
Margins on value-added midstream and downstream steel products are typically less volatile than those on upstream steel products. BlueScope Steel's investment strategy is designed to help insulate the Company from sharp peaks and troughs in steel prices. Reducing the effects of this volatility should provide greater stability in earnings and growth, and consistent long-term performance for our shareholders. We are confident we can deliver on our strategy. It's our platform for profitable growth into the future and our foundation to keep delivering for you, our shareholders.
