North Star results improve despite buyer caution as tariffs drive prices higher

Causes and conditions 

Steel segment performances varied for the steel producer. BlueScope Managing Director and CEO Mark Vassella said North America remains a key market and that the company is committed to improving operations.  

“Disappointingly, there has been a delay in achieving our expectations of the BlueScope Coated Products business, which we acquired in 2022, and an impairment of A$439 million has been recorded. It remains core to our North American growth strategy, and we continue to invest in the turnaround of the business,” he commented. 

North American Operations 

North Star 
Located in Delta, Ohio, the company’s North Star facility found that its financial performance improved upon price increases fueled by the threat of Section 232 tariffs on imported steel.  

However, the company stated it also suffered from buyer caution accompanying the potential tariff-driven price increases. It expects higher realized prices in the future.

North Star shipped higher volumes “due to the expansion ramp-up, which produced 800,000 metric tons in the year,” the company said. For fiscal year 2025, North Star shipped more than 2.9 million mt.

The operations for H2’2025 resulted in EBIT A$201.6 million and A$267M in FY2025, down 46% from FY2024. 

Buildings and Coated Products 
The Building and Coated Products division reported a mixed set of financial results. BlueScope stated that the investments performed poorly, and time was lost integrating the assets, which ultimately have not lived up to expectations.  

The company stated that it is targeting improvements to its sales and operations in the Building and Coated Products division, focusing on growth in North America.  

Meanwhile, Steelscape’s financial performance improved in H2’25 as a result of lower operating and conversion costs.  

Overall, the segment’s EBIT for H2’25 totaled A$131 million and A$249.3 million in FY2025, a decrease of 42% compared to A$431.4 million for FY2024.  

Looking ahead  

The earnings release listed the company’s near-term goal of delivering A $200 million net improvement in fiscal year FY2026 on the FY2024 cost base. It stated its medium-term goal of delivering A$500 million of additional annual earnings by 2030.  

BlueScope contends that planned improvements make the goal feasible. The company expects price improvements from tariffs to improve steel spreads. And it will continue to focus on strategic investments, focus on operational improvements for its core capabilities, and plans to realize its surplus and adjacent landholdings. The company states that even if currency cycles become unfavorable, they still stand to deliver on the 2030 targets. 

Vassella predicts stronger macroeconomic conditions for the coming year: “… with work underway to reduce costs and grow through-cycle earnings, combined with the expected recovery in macroeconomic conditions in coming years, BlueScope is leveraged to the upside.”