BlueScope Steel Ltd. sharply raised its dividend and increased its share buyback program by up to 700 million Australian dollars (US$502 million) after recording a surge in first half profit.
The Australia-listed steelmaker Monday said it made a net profit of A$1.64 billion in the six months through December, up from A$330.3 million in the year-earlier period.
First-half underlying earnings before interest and tax, or Ebit, quadrupled to A$2.20 billion, BlueScope said. The company said as recently as November that it expected Ebit in the range of A$2.1 billion to A$2.3 billion.
Directors declared an interim dividend of 25 Australian cents a share, up from 6 Australian cents a year ago. BlueScope said it would buy back up to A$700 million in shares over the next 12 months, after having already bought A$285 million since August, 2021.
The steelmaker said it expects underlying Ebit in the second half between A$1.20 billion and A$1.35 billion.
BlueScope has been benefiting from market tailwinds, including strong demand, prices and margins across its core markets. BlueScope has operations in a number of countries including the U.S., Australia and China.
It was "clearly the best half-year performance BlueScope has produced in its 20-year history as a listed company," said Chief Executive Mark Vassella.
"Demand in key segments, especially in building and construction, has been strong, coupled with particularly robust margins driven by increased steel prices in Asia and the U.S," he said.
BlueScope says recent strong earnings are enabling it to invest in growing its business. The company is already expanding its North Star mini-mill in Delta, Ohio and is considering a further debottlenecking project once that expansion is completed. It has further expanded its U.S. footprint with the acquisition of the ferrous scrap steel recycling business of MetalX LLC.