BlueScope Steel says its underlying full-year earnings are likely to miss expectations but the company has softened the blow by extending its share buy-back program by up to $250 million.
The steel producer said on Tuesday FY19 underlying EBIT was approaching $1.35 billion, an increase of about 6.0 per cent FY18 and likely to fall below previous guidance of a 10 per cent increase.
BlueScope said market conditions had been softer than anticipated in ASEAN and North America, while benchmark steel spreads had dropped by $US150 per tonne since the previous guidance in February, instead of the $US130 per tonne decline initially flagged.
But with continued strong cash flow the company also announced it will extend the current on-market buy-back program by up to $250 million, as part of its first-half FY20 capital management program.
BlueScope said it expects to continue share buy-back activity at its discretion during July and then after the release of its FY2019 financial results on August 19.
“With the transformed business continuing to generate strong cash flow, we are able to pursue a mix of returns to shareholders and investing for future growth,” managing director and chief executive Mark Vassella said in a release.