By Rhiannon Hoyle

BlueScope Steel on Monday reported a 59% drop in first-half profit because of lower steel prices and higher costs, but raised its dividend and extended its share buyback.

The Australia-based company said it made a net profit of 179.1 million Australian dollars (US$113.7 million) in the six months through December, down from A$439.3 million in the year-prior period. Analysts expected a profit of roughly A$171.2 million, according to data compiled by Visible Alpha.

The steelmaker reported underlying earnings before interest and taxes of A$308.8 million, down 57% year over year. BlueScope forecast a second-half result of between A$360 million and A$430 million.

Steel prices have been falling and costs rising, narrowing steelmaking margins.

"While an 8.1% return on invested capital is not at the level we would like to see, it is a solid result in this climate of soft steel spreads in Asia and the U.S. and soft demand conditions for our operations outside the U.S.," said Chief Executive Mark Vassella.

Directors declared an interim dividend of 30 Australian cents a share, up from 25 cents a year ago. The company in August said its board intends to target an annual dividend of 60 cents, citing the growth and resilience of its business and a reduced share count following buybacks.

Directors also approved an extension of a A$240 million buyback program to allow it to be used over the next 12 months, BlueScope said.

Write to Rhiannon Hoyle at rhiannon.hoyle@wsj.com

(END) Dow Jones Newswires

February 16, 2025 16:36 ET (21:36 GMT)

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