Shares of BlueScope Steel Limited (ASX: BSL) rose as much as 3.4% within minutes of the ASX's open this morning following the release of its half-year financial report.
For the six-month period ended 31 December 2015, BlueScope reported a 2.3% increase in revenue to $4,438.8 million and a net profit of $226.6 million, up 97.7% on the prior corresponding period.
The statutory profit figure takes into account $567.5 million of impairments to assets as well as a carried forward tax loss. The profit result was also boosted by a write-up to the carrying value of BlueScope's recently acquired 50% stake in US-based North Star BlueScope Steel. BlueScope previously held a half ownership stake in the business and acquired full ownership at the end of October 2015. Upon taking 100% ownership, it was required to revalue the asset.
"The Company has continued its good momentum in earnings growth. It's a very positive outcome and a credit to our teams around the globe," BlueScope's managing director and CEO, Paul O'Malley, said. "Today's result is the outcome of a deliberate strategy that has been underway for over a year."
"We have moved to full ownership of North Star, recognised as the best steelmaking business in the US. It has a clear pathway of incremental growth ahead of it," Mr O'Malley added.
Pleasingly, the company's board resolved to declare an interim fully franked dividend of 3 cents per share.
And despite plunging iron ore prices, oversupply and volatility in steel markets, Mr O'Malley said: "The results today confirm our strategy is working; it has delivered substantial bottom line benefits in the half."
On an underlying basis (excluding the one-off costs and benefits highlighted above), BlueScope achieved EBIT (earnings before interest and tax) growth of 35% year over year.
Looking ahead, Mr O'Malley said the company appears set for another strong half. "Notwithstanding a challenging macroeconomic environment, due to the significant cost reductions and process improvements we are implementing, we expect 2H FY2016 underlying EBIT to be up to 60% higher than 2H FY2015."
