BlueScope has increased its FY16 underlying earnings before interest and tax (EBIT) guidance to $580m, representing around a $70m improvement in the second half of FY16
The improved performance has come from higher margins in the international business and the positive turnaround in Asian steel prices.
Net debt is expected to reduce by around $600m over the second half of FY16 to $780m at financial year end – a significant 43% reduction. This has been driven by strong operating cashflows in 2H16 as well as $100m from favourable timing in end of year cashflows, plus $105m from the sale of receivables. The debt reduction translates to a guided FY16 net debt / EBITDA ratio of 0.8 times which is considered conservative.
The BlueScope 6.50% US dollar bond maturing in May 2021 is currently indicatively offered at a yield to worst* of 4.06%.
A link to the announcement is available here.
Please contact your FIIG representative for further details on the BlueScope USD bonds. Available to wholesale investors with a minimum face value of USD10,000.
*The yield to worst on the BlueScope bond is currently the yield to the first call date (May 2018 at USD103.25)