Mumbai: BlueScope Steel Ltd., Australia's largest steelmaker, saw its annual net profit double to to A$686 million (US$548.8 million) despite a lower-than expected second-half income, the company said.
BlueScope said its revenue in the year to June had grown 11 per cent to A$8.9 billion.
BlueScope's second-half profit growth declined after costs rose and the stronger local currency eroded earnings.
Net income for the six months ended June 30 rose to A$298 million ($238 million) from A$26 million a year ago, the Melbourne-based company said.
Higher iron ore, zinc and scrap metal prices boosted BlueScope's full-year production costs by A$365 million while a stronger Australian dollar cut earnings in the second half by about A$30 million, chief financial officer Paul O'Malley said on a conference call.
Business in Asia grew substantially as new operations in China, Vietnam, Thailand and India were commissioned and ramped up, the company said.
Bluescope recently acquired Smorgon Steel's distribution business as part of a deal in which Australia's second-largest steel producer Onesteel took over the rest of Smorgon. That added about 550,000 tonnes to steel distributed.
BlueScope is spending A$1.5 billion in expansions in Thailand, Vietnam, China and India in an attempt to diversify earnings. The company is still ``looking'' for acquisitions, O'Malley said.
Bluescope said higher sales volumes and prices and a profit on the sale of its Vistawall business for $190 million partly offset the higher cost of raw materials and the effects of changes in foreign exchange rates.
BlueScope produces hot-rolled steel coil, a benchmark product, used in cars and buildings, and also processed to make pipes and tubes. It also paints, coats and processes steel, turning it into roofs, fences and walls. Customers include OneSteel Ltd., Australia's second-largest steelmaker, and General Motors Corp.
In contrast, Arcelor Mittal, the world's largest steelmaker, reported a 50 per cent increase in second-quarter profit after raising prices in the US and Europe. Posco, Asia's third- largest steel producer, posted a 55 per cent increase in profit as it raised prices to meet rising demand from carmakers and shipbuilders.