BlueScope Buildings North America Investor Visit Presentation Dan Kumm, President June 2017 BlueScope Steel Limited. ASX Code: BSL
Important Notice THIS PRESENTATION IS NOT AND DOES NOT FORM PART OF ANY OFFER, INVITATION OR RECOMMENDATION IN RESPECT OF SECURITIES. ANY DECISION TO BUY OR SELL BLUESCOPE STEEL LIMITED SECURITIES OR OTHER PRODUCTS SHOULD BE MADE ONLY AFTER SEEKING APPROPRIATE FINANCIAL ADVICE. RELIANCE SHOULD NOT BE PLACED ON INFORMATION OR OPINIONS CONTAINED IN THIS PRESENTATION AND, SUBJECT ONLY TO ANY LEGAL OBLIGATION TO DO SO, BLUESCOPE STEEL DOES NOT ACCEPT ANY OBLIGATION TO CORRECT OR UPDATE THEM. THIS PRESENTATION DOES NOT TAKE INTO CONSIDERATION THE INVESTMENT OBJECTIVES, FINANCIAL SITUATION OR PARTICULAR NEEDS OF ANY PARTICULAR INVESTOR. THIS PRESENTATION CONTAINS CERTAIN FORWARD-LOOKING STATEMENTS, WHICH CAN BE IDENTIFIED BY THE USE OF FORWARD-LOOKING TERMINOLOGY SUCH AS “MAY”, “WILL”, “SHOULD”, “EXPECT”, “INTEND”, “ANTICIPATE”, “ESTIMATE”, “CONTINUE”, “ASSUME” OR “FORECAST” OR THE NEGATIVE THEREOF OR COMPARABLE TERMINOLOGY. THESE FORWARD-LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS WHICH MAY CAUSE OUR ACTUAL RESULTS, PERFORMANCE AND ACHIEVEMENTS, OR INDUSTRY RESULTS, TO BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS, PERFORMANCES OR ACHIEVEMENTS, OR INDUSTRY RESULTS, EXPRESSED OR IMPLIED BY SUCH FORWARD-LOOKING STATEMENTS. TO THE FULLEST EXTENT PERMITTED BY LAW, BLUESCOPE STEEL AND ITS AFFILIATES AND THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS, ACCEPT NO RESPONSIBILITY FOR ANY INFORMATION PROVIDED IN THIS PRESENTATION, INCLUDING ANY FORWARD LOOKING INFORMATION, AND DISCLAIM ANY LIABILITY WHATSOEVER (INCLUDING FOR NEGLIGENCE) FOR ANY LOSS HOWSOEVER ARISING FROM ANY USE OF THIS PRESENTATION OR RELIANCE ON ANYTHING CONTAINED IN OR OMITTED FROM IT OR OTHERWISE ARISING IN CONNECTION WITH THIS. 2
INTRODUCTION Spirit Airlines Maintenance Hangar, Detroit BlueScope Construction
BlueScope Buildings North America Progress towards our goal of Zero Harm Lost time injury frequency rate Medically treated injury frequency rate Medically treated injuries per million man-hours worked Lost time injuries per million man-hours worked 15.0 10.8 8.2 8.1 6.5 6.0 5.9 5.8 5.7 5.3 BlueScope group average 1H FY17: 5.4 1.8 1.7 BlueScope group average 1H FY17: 0.7 0.6 0.6 0.5 0.4 0.4 0.4 0.2 0.2 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 1H17 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 1H17 4
BlueScope Buildings strategy with BSL strategic framework Grow Deliver Ensure ongoing premium branded steel businesses competitive commodity steel supply financial strength with strong channels to market in our local markets Coated & Painted BlueScope North Star Australia & NZ Balance Sheet Products Buildings BlueScope Steelmaking Maintain strong Drive growth in Maximise value Deliver value from balance sheet premium branded Australian/NZ Drive growth in North coated and painted steelmaking and iron America and turn steel markets in sands by game- around China Asia-Pacific changing cost reduction or alternative model Invest & grow Optimise & grow Optimise / invest Restructure Maintain 5
BlueScope Buildings segment has been established to unite BlueScope’s Building Solutions businesses and accelerate growth BlueScope Buildings Chief Executive – Pat Finan Buildings North Products & Buildings ASEAN America Buildings China Engineered Building Engineered Building Engineered buildings, Solutions in North coated steel and Solutions in ASEAN America building components (Lysaght) in China Dan Kumm – President Ku Wei Cheong – President Bernie Landy – President Sales A$1.7Bn; 14 Manufacturing Sites; Over 4,500 employees 6
A broad portfolio of leading Building Solution brands / products Buildings ASEAN Buildings North America Product & Buildings China Note – Buildings ASEAN is part of NS BlueScope Coated Products JV value chain 7
BUSINESS OVERVIEW Costco – Melbourne, Australia
BlueScope Buildings North America (BBNA) overview • BBNA designs/manufactures/markets Engineered Building Solutions (EBS) to the low-rise non- residential construction segment • Comprised of the leading engineered building brands and best known builder distribution networks • BBNA sold 25% of the EBS designed steel structures in North America • Brief history: Butler Founded Butler 1 st to introduce 3- BSL Acquires Butler GFC Impact plate Rigid frame VP introduces “custom concept” 1948 2008 2009 1901 1963 2004 1939 2017 VP Buildings Commenced Business BlueScope acquires Varco Pruden 9
BBNA supply chain / channel to mark et Up-stream Mid-stream Down-stream North Supplier BBNA Star Butler Shared Services Butler Builders Platform BSL / Steel- Nippon scape Manufacturing Purchasing Innovation / R&D VP End Engineering Supplier VP Customer Builders System Service Warranty Admin Centers Quality Control Supplier Human Resources Finance / Tax BSC Payroll IT Supplier Corporate Market Facing Non-market Facing Economy of Scale Brand Specific Focus 10
Nearly 1,800 Butler and VP builders across North America 24% 11
So what is an engineered building solution (EBS)? Engineered Building Solution Conventional steel building • Fit-for-purpose structural system • Conventional design using leveraging tapered frame concept standard hot rolled sections Standard structural members • Design each structural member to • meet unique load requirements selected from known criteria • Performs well with large clear- • Performs well with low and high- span requirements and low-rise rise solutions with moderate to low construction spans required Scope typically stops with • Frequently integrates roof and/or • wall system as a total solution structure and deck Key benefits to engineered building solutions are: Reduced steel usage on targeted end use buildings Integration: One trade performing structure, roof, and walls vs. three Rapid construction time Superior lifecycle costs of metal roof systems Reduced dependency on certified welders in field Well suited for emerging design-build trend in construction industry 12
Mission / vision of BlueScope Buildings North America BBNA is a solution provider proficient in both engineered building solutions and conventional steel, providing hybrid solutions that leverage the best of both worlds. Mission: To grow our industry leading position as a solution provider for non-residential low-rise building market. Delivering our products and services primarily through multiple brand, distribution network of Builders with focus on differentiation and growth initiatives through the rollout of new products, new services, and superior quality. 13
BlueScope Buildings North America has been the 1 st to offer: ‘Z’ Shaped Computer Purlins designed rigid Self-curbing day frame structure lighting system Pre-Punched structural and G30 Acrylic panel as standard Long spanning secondary structural truss using tension Sky-Web fall controlled bolt tightening protection system technology “Custom Engineered” Pre-Engineered Low-Slope vs “Pre- standing seam pre- Engineered” roof system engineered buildings 14
BlueScope Construction history Manufacturing Plants Manufacturing Plants • Established in 1970 • In-house construction capability • Account for 19% of BBNA Revenue Distribution Centers & Distribution Centers & Shipping Hubs Shipping Hubs • On track for best fiscal year on record • National footprint – licensed in all 50 states • Capabilities include: program accounts, government, & large/complex jobs Aircraft Hangars • Strategic purpose is to capture all work that does not fit existing builders’ capability Athletic Facilities Athletic Facilities 15
BlueScope Construction has a long history of conquering challenges of key corporate accounts FedEx Ground Ace Hardware Retail Support Centers Over 100 projects since 1995 6.5 million square feet $200 million in contracts 16
BlueScope Buildings North America management team Dan Kumm President, BlueScope Buildings NA Peta Renkin VP Human Resources Chuck Haslebacher President, Varco Pruden Ralph Gaitley VP Operations and Tom Gilligan Supply Chain President, Butler Manufacturing Ron Miller Matt Threadgill VP Innovation President, BSC Joel Burke VP Software Greg Pasley Solutions President, Conventional Steel Services Andrea Duckworth VP Finance 17
Integrated manufacturing platform Evansville Annville St Joseph Visalia Jackson Laurinburg Monterrey (Mexico) Rainsville Total Capacity: approx. 320 metric kt Manufacturing facility 18
World-class facilities: Visalia, CA 19
World-class facilities: St Joseph, Missouri 20
U.S. ENGINEERED BUILDINGS DEMAND SVSU Ryder Center –University Center, MI VP Builder: a.j. Veneklasen, Inc.
Ascent Construction Corporate Office Building.– Farmington, UT VP Builder: Ascent Construction 22
Orion Jet Center – Opa-Locka, FL VP Builder: Lemartec 23
Butler Builder: Derrick Building Solutions, L.L.C. Barley John’s Brewery – New Richmond, WI 24
Twin Rivers Charter School – Yuba City, CA Butler Builder: Hilbers, Inc. 25
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