BlueScope Australia & New Zealand (BANZ) Investor Briefing Day

30 May 2013

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. Page 2 Agenda

Introduction: Mark Vassella – Chief Executive, BlueScope Australia & New Zealand

CIPA Products and Markets: Andrew Garey – General Manager, Sales & Marketing

CIPA Manufacturing: John Nowlan – General Manager, Manufacturing

Building Components & Distribution Australia: Andrew Bray – General Manager, Distribution Mark Crimmins – General Manager, LYSAGHT

New Zealand & Pacific Islands: Simon Linge – President, New Zealand Steel & Pacific Islands

Summary: Mark Vassella

Page 3 Safety is a core value for BlueScope. BANZ continues to have world class performance and is striving for zero harm

Lost Time Injury Frequency Rate (BANZ) Medically Treated Injury Frequency Rate (BANZ)

2.24 11.34

9.65 9.15 9.20

1.52 7.14 1.38 1.35 6.76 1.23 6.28 1.17 5.35 1.01 5.00 5.26 0.95 per million man-hours worked 4.87 0.86 0.90 0.64 Lost time injuries per million worked time injuries per man-hours Lost Medically treated injuries Medically treated FY11 FY11 FY12 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY12 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY13* FY13*

*Note: FY2013 data is up to and including March 2013. Charts in include both contractor and direct employee data combined Page 4 BlueScope remains committed to continuously improving the environmental footprint of its operations

• The BlueScope Steel Environment Management System comprises the following major elements: 9 Our Bond 9 HSEC Policy 9Environment Principles 9 Environment Standards 9 BSL & Operational Procedures and Guidelines

• BlueScope continues to work on improving performance through its Environment Network involving environment reviews and audits, implementation of the compliance system, the business planning process, and the engagement of all employees in environment awareness & training

• We manage our environmental risks and impacts through the use of a framework we call LAWWNE, which seeks to: 9 Reduce our environmental impact on Land, Air, and Water 9 Reduce generation of Waste and Noise 9 Minimise our use of Energy and the generation of GHG emissions

Page 5 Introduction

Page 6 BlueScope Australia & New Zealand businesses

BlueScope external operating segment reporting structure1

Building Products Coated & Industrial Building Components New Zealand and Global Building Hot Rolled Products ASEAN, North Products Australia & Distribution Pacific Steel Solutions North America America and India (CIPA) Australia (BCDA) Products

• Leading global designer • Operates metallic coating • Largest supplier and only • Major steel product • Only fully integrated flat • 2.1Mtpa mini-mill in Ohio and manufacturer of pre- and painting lines and roll- manufacturer of HRC, plate, supplier / distributor to the steel maker in New Zealand • 50/50 JV with Cargill Inc. engineered buildings2 forming in Indonesia, metal coated and painted Australian building and • Leading domestic market • Voted no. 1 flat rolled • Key markets in China & Malaysia, Thailand, steel in Australia construction, automotive, share of flat products Nth America; plants in Vietnam, India and North white goods manufacturing steel supplier in North • Australian finished-product • Includes iron sands mines America (Jacobsen ASEAN, India, Mid. East America capacity of ~2.5Mtpa; and general manufacturing • Supplying buildings to industries (own consumption and Survey) for ten • Includes NS BlueScope domestic market 1.9Mt in export sales) consecutive years global customers Coated Products JV CY2012 • China coating & painting

(1) BlueScope also has a Corporate segment which is not shown; (2) engineering and component building systems Page 7 The BANZ business structure was created in July 2011, and the management team was refined in January 2013 to ensure we stay focussed on core business

BANZ Management Team

Page 8 BlueScope Australia and New Zealand (BANZ) Considerable change since established on 1 July 2011

Business Changes • On 1 July 2011, BANZ was established by combining three existing businesses into one. The right structure to support better management decisions across one value chain, enabling more effective resource allocation across business lines. • Major Australian operational restructure announced on 22 August 2011: – Halved production, largely exited export business and moved to a one Blast Furnaces operation at Port Kembla steelworks – Numerous consequential changes for other operational assets in the supply chain • Subsequently, major changes and restructures completed across both the Distribution and LYSAGHT businesses in Australia to reduce costs and better align with the current market • Expanded our minerals business in New Zealand, including iron sands exports. During 2H CY2014 we expect to achieve at least a 2.7Mtpa run rate and therefore the Company will be 55% economically hedged on iron ore cost • In January 2013 announced significant changes to optimise our Western Port operations to match our supply capability to the current market demand • Launch of Next generation ZINCALUME® with Activate™ technology in coming months – breakthrough new coating technology

Page 9 BlueScope Australia and New Zealand (BANZ) Considerable change since established on 1 July 2011

Behavioural Changes – A fundamental change in the way we operate

• A ‘one value chain’ approach

• A ‘market driven’ approach

• Focusing on controlling the actual cost and quality per tonne of steel produced (at half the volume)

• Initiated the ‘Triple A’ culture change program in early 2012. Goal: all employees to be: Aligned, Accountable and Agile

• More effective and efficient communications to better engage employees. BANZ Blog, BANZ TV, BANZ News

Page 10 BANZ will be a vibrant, sustainable steel business. We are good at what we do and proud of it

TARGET WINNING We’re recharging BANZ to deliver long term MARKETS sustained profitability and cash generation GET LEAN, FIT TRIPLE A AND HUNGRY CULTURE

BROADEN VIEW TO CREATE GROWTH

OPTIMISE $ VALUE CHAIN

Page 11 Snapshot of BANZ strategic initiatives

• Next generation ZINCALUME® steel with Activate™ technology has commenced production in Australia and is being progressed at NZ Steel • This will become the substrate of next generation of COLORBOND® steel Target winning markets products which will be released in late 2013 • Progress is being made on combating unfair trade by international steelmakers (anti-dumping & countervailing actions)

• Ongoing cost reductions in CIPA through feed mix changes, lean manufacturing initiatives, and manning optimisation • Continue to improve performance of BCDA through network and process Get lean, fit, and hungry optimisation initiatives • Cost savings in NZS through utilisation of lower cost raw materials, maintenance spend optimisation, and ongoing productivity improvements

• During 2H CY2014 we expect to achieve at least a 2.7Mtpa iron sands export run rate • Utilisation of NZ iron sands in PK to lower the total feed cost Optimise value chain • Maximising by-product revenue streams through Vanadium sales growth • Pacific Islands businesses selling broader suite of BSL products and solutions (e.g. PEB’s) • Deep pipeline of product development initiatives to unlock new market Broaden view to create growth opportunities for BANZ • Investigating non-traditional areas of business activity Page 12 Coated & Industrial Products Aust – Products & Markets

Page 13 Product categories and applications

Product Primary end use markets Applications

Slab • Steel manufacturing • Hot rolled coil and plate

Plate • Manufacturing, building and construction • Infrastructure projects, mining equipment and structural and mining applications

Hot rolled coil • Building and construction, mining, • Mining equipment, racking, guard rails, building and construction automotive and transport, manufacturing products, structural tubing, water pipelines, oil/gas pipelines and automotive components Cold rolled coil • Automotive and transport, manufacturing • Automotive, packaging (drums) and storage systems

Galvanised (including • Building and construction, manufacturing, • General manufacturing, automotive, structural sections for GALVASPAN® steel) and special automotive and transport commercial and industrial buildings and structural decking zinc finishes

Zinc/aluminium alloy-coated • Building and construction • Commercial and industrial construction including roofing, walling, rain water goods and residential framing ZINCALUME® steel

Painted (including pre-painted • Building and construction • Residential, commercial and industrial construction including COLORBOND® steel) roofing, walling, fencing, rain water goods, architectural panels, sheds and garages

Page 14 1H FY2013 despatch mix

1,248kt

Export 345kt Export

HRC Plate CRC Metal Coated Painted Domestic 903kt Other Domestic

Six months

ended Dec-2012 Page 15 Four fundamental drivers of profitability

Domestic Demand Domestic Volume / Mix Market Share

CIPA Profitability

Global Spread

Margins Domestic Value Proposition

Page 16 Market channels

Building Component Market Segments Manufacturers (including Lysaght) Residential

Non-Dwelling Steel Distribution (including BSD) & Coating Engineering Domestic Manufacturing Pipe and Tube Manufacturing Agriculture & Mining

Automotive & General Manufacturing Transport Export

Page 17 Australian external despatch volumes

2H FY08 1H FY09 2H FY09 1H FY10 2H FY10 1H FY11 2H FY11 1H FY12 2H FY12 1H FY13 1,800 (No. 5 Blast 63% Furnace Reline) 1,600 64% Construction 65% 1,400 27% (436kt) 66% 27% (389kt) 67% 67% 65% 64% 1,200 28% (391kt) 28% (349kt) 65% 21% (344kt) 29% (344kt) 1,000 29% (340kt) 29% (346kt) 28% (321kt) 23% (341kt) 30% (311kt) 70% 23% (320kt) Non-dwelling 800 25% (312kt) 15% (243kt) 29% (236kt) 27% (313kt) 26% (308kt) 26% (301kt) 24% (274kt) 14% (212kt) 600 14% (187kt) 27% (278kt) Dwelling ‘000 tonnes 13% (208kt) 13% (161kt) 2 13% (192kt) 28% (235kt) 11% (133kt) 13% (154kt) 10% (119kt) 12% (138kt) Engineering 400 11% (152kt) 8% (89kt) 13% (160kt) 13% (109kt) 11% (123kt) 10% (124kt) 11% (128kt) 12% (131kt) 11% (118kt) Manufacturing 15% (239kt) 14% (202kt) 14% (198kt) 200 11% (90kt) 13% (156kt) 13% (157kt) 14% (164kt) 15% (174kt) 15% (170kt) 15% (158kt) Agri & mining 9% (144kt) 11% (92kt) 9% (130kt) 8% (105kt) 10% (134kt) 9% (102kt) 9% (106kt) 9% (106kt) 9% (103kt) 9% (94kt) Auto & transport 0 8% (62kt) Gross 1,614kt 1,466kt 824kt 1,243kt 1,381kt 1,168kt 1,198kt 1,174kt 1,138kt 1,048kt Despatches less 1 (264kt) (192kt) (140kt) (164kt) (166kt) (161kt) (160kt) (159kt) (148kt) (143kt) Normalised Despatches 1,368kt 1,274kt 684kt 1,079kt 1,215kt 1,007kt 1,038kt 1,015kt 990kt 905kt FY2009 FY2010 FY2011 FY2012 1,958kt 2,294kt 2,045kt 2,005kt

(1) Normalised despatches exclude third party sourced products, in particular, long products. (2) Engineering includes infrastructure such as roads, power, rail, water, pipes, communications and some mining-linked use Page 18 Australian residential construction starts slowly improving

Quarterly number of Australian residential construction starts (total new houses) to December 2012 1

(Number per quarter) 40,000

35,000

30,000

25,000

20,000

15,000

10,000 Jun Jun Jun Jun Jun Jun Jun Jun Jun Jun Jun Jun Jun Jun Jun Jun Jun Jun Jun Jun Jun Jun Jun Jun Jun Jun Jun Jun 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12

Source: Australian Bureau of Statistics. Series ID: 8752.0 Building Activity, Australia. Table 33: Number of Dwelling Unit Commencements by Sector, Australia.

(1) Based on total number of dwelling units – total houses, on seasonally adjusted basis. Excludes multi-dwelling commencements. House definition: A detached building primarily used for long term residential purposes consisting of one dwelling unit. Includes detached residences associated with a non-residential building, and kit and transportable homes Dwelling: A dwelling unit is a self-contained suite of rooms, including cooking and bathing facilities and intended for long-term residential use. Units (whether self-contained or not) within buildings offering institutional care, such as hospitals, or temporary accommodation such as motels, hostels and holiday apartments, are not defined as dwelling units. The value of units of this type is included in non-residential building. Page 19 Spread is a major determinant of CIPA profitability

East Asia HRC Price (US$/t) and Indicative Steelmaker HRC Spread (A$/t) Spread: SBB East Asia HRC price less cost of 1.5t iron ore fines and 0.71t hard coking coal $800 SBB East Asia HRC (US$/t) $700 $600 $500 $400 $300 Indicative Steelmaker $200 Spread (A$/t) Indicative spread with pricing lags (A$/t) $100 $0 Jan-00 Jan-01 Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Source: SBB, CRU, Platts, TSI, Reserve Bank of Australia, BlueScope Steel calculations FY2010 FY2011 FY2012 1H FY12 2H FY12 1H FY13 Indicative steelmaker HRC spread (US$/t) 365 271 276 260 291 273 Indicative steelmaker HRC spread (A$/t) 414 275 267 253 282 263 Indicative spread with pricing lags (A$/t) 398 290 261 249 273 287 A$ / US$ FX 0.88 0.99 1.03 1.03 1.03 1.04 Notes on calculation: • ‘Indicative steelmaker HRC spread’ representation based on simple input blend of 1.5t iron ore fines and 0.71t hard coking coal per output tonne of steel. Chart is not a specific representation of BSL realised export HRC spread (eg does not account for iron ore blends, realised steel prices etc), but rather is shown primarily to demonstrate movements from period to period arising from the prices / currency involved. ‘Indicative spread with pricing lags’ includes three month HRC price lag and two month raw material prices lags • Indicative iron ore pricing: 62% Fe iron ore fines price assumed. Industry annual benchmark prices up to March 2010. Quarterly index average prices lagged by one quarter from April 2010 to March 2011; 50/50 monthly/quarterly index average from April 2011 to December 2012. Monthly thereafter. FOB estimate deducts Baltic cape index freight cost from CFR China price. • Indicative hard coking coal pricing: low-vol, FOB. Industry annual benchmark prices up to March 2010; quarterly prices from April 2010 to March 2011; 50/50 monthly/quarterly pricing thereafter. Page 20 Better profitability in coated and painted products

Category Summary

• Ingredient products, typically substantially transformed into final Hot Rolled Coil Limited goods. Plate product • BSL offer principally differentiated by service offer, supply reliability differentiation and product quality Cold Rolled Coil • Import parity pricing (IPP)

• Make use of sophisticated coating technologies, important to product durability in end applications Aluminium Zinc Coated (Next Generation Increased • BSL’s products principally differentiated by product quality and ZINCALUME® steel) product reliability, reputation (brand), service offer differentiation • BSL investing in the introduction of unique product coating Galvanised coated technologies that further improve differentiation • IPP influences pricing • High quality painted products designed for Australian environment to maximise durability Most • BSL’s products differentiated by strong consumer brand preference, COLORBOND® Steel differentiated product warranties, product reputation, ubiquity and supply offer complexity. • Intermaterial pricing most influential Page 21 Progress on challenging unfair trade and dumping

Process Current Duties

• Preliminary Affirmative Determination (PAD) issued Oct 2012 • Final recommendation Dec 2012 • Interim Dumping Duties (IDD) rates: Hot Rolled Coil • Trade Measures Review initiated in Feb 2013 and announced in Apr – Japan 0- 7.5% 2013, has resulted in reinvestigation by Customs for Minister’s – Korea 2.6 - 11.8% (Anti-Dumping) sign-off by July 2013 (deals with four matters: basis of Ascertained – Malaysia 15.4% Export Price, Hyundai dumping margin, Auto industry dumping duties, – Taiwan 2.6-8.2% HR P&O other than Japan)

Galvanised steel & • Galv PAD rates: China 6.8-60.6%; aluminium / zinc (AlZn) • PAD issued Feb 2013 Korea 0-17.6%; Taiwan 0-12.7% coated steel • Minister decision due Jul 2013 • AlZn PAD rates: China 4.9-20.4%; (Anti-Dumping) Korea 0-7.7%

• Galv PAD rates: 0-24% Galvanised • PAD issued May 2013 • AlZn PAD rates: 0-21% & AlZn coated steel (duties are not cumulative on top of (Countervailing – China) • Ministers decision due July 2013 antidumping duties, no double counting)

Plate (Anti-Dumping & • Statement of Essential Facts due June 2013 • Awaiting findings Countervailing)

Page 22 Next Generation ZINCALUME®: Reinforcing status as market leader

• Production of next generation ZINCALUME® steel with Activate™ technology commenced in 2H FY2013 following development and testing over a number of years

• Customers will benefit from: ¾ Improved product lifespan and longer warranties ¾ Reduced environmental footprint due to reduced coating metals and increased lifespan

• BlueScope will benefit from: ¾ Sales into new areas and applications including perforated construction products ¾ An ‘exclusive’ offering of leading technology for roofing, walling and rainwater applications; patent protection for BSL and NSSMC

• Market familiarisation program – very positive response from construction industry professionals

• Will become the substrate of next generation of COLORBOND® steel products which will be released late 2013

Page 23 Next Generation ZINCALUME®: Activate™ technology

AZ150 AM125

Original Next generation ® ZINCALUME® steel ZINCALUME steel with Activate™ technology

• The introduction of magnesium into the aluminium-zinc alloy coating improves galvanic protection by activating the aluminium to provide more effective corrosion resistance

•Outcome - Improved performance with less total coating mass (125 g/m2)

Doing more with less

Page 24 Next Generation ZINCALUME®: market response positive

• Multi-channel marketing program well advanced – Targets four key audience groups: Architects, Builders, Developers and all construction professionals

• Direct customers are engaged and very positive towards the opportunities this new product presents

• Architects actively specifying the new product for projects in pipeline

• Low risk implementation: – Better performing product – Recognised in Australian Standards for roofing and walling as highest corrosion-resistant product available – Longer warranty – Readily available with no change to fixing techniques

Page 25 Coated & Industrial Products Aust – Manufacturing

Page 26 BlueScope’s Illawarra businesses

Flat Products Recycling Area (HRC & plate)

Iron & Steelmaking

Research, Administration & Original Steelworks Site

Page 27 Overview of flat products process in Australia: raw materials to HRC

SINTERING

Coal Iron Ore

BLAST FURNACE

Sintered ore COKE OVEN Coke

Molten pig iron Slag CONVERTER (BOS)

“Graded” Liquid Steel REFINING STAND CONTINUOUS CASTING

Slab REHEAT FURNACE

HOT STRIP MILL

Hot Rolled Coils

Page 28 Overview of flat products process in Australia: pickling and cold rolling

Coupled Pickle Cold Mill (CPCM)

Thickness reduction via cold rolling through Recoiling using five stands carousel reel

Scale removal (pickling) using hydrochloric acid Hot rolled coil is uncoiled

To Metal Coating or Pack & Despatch

Page 29 Overview of flat products process in Australia: metal coating

Metallic Coating Line (MCL)

Page 30 Overview of flat products process in Australia: painting

Continuous Paint Line (CPL)

Primer Ovens Primer Coater

Main Oven Main Coater

Inspect & Test

Painted coil is recoiled Chemical rinsing, cleaning & pre-treatment Coated Coil from Metal Coating Lines

Page 31 Annual capacities

Port Kembla Steelworks (Wollongong, New South Wales, Australia) #5 Blast Furnace 2,600 Slab Casters 2,600 Slab Plate Mill Plate 450 Hot Strip Mill HRC 2,900

Coupled Pickled Cold Mill CRC 990 Metal Coating Lines Metal Coated 825 Strip Springhill Coated Works Paint Lines (Wollongong, NSW, Australia) Painted Strip 2001

Pickle Line Pickled HRC 1,100 Cold Mill CRC 1,000 Metal Coating Lines Metal Coated 2 Western Port Coated Works 830 Strip (Hastings, Victoria, Australia) Paint Lines Note: Painted Strip Numbers reflect mill capacity in kt per annum 330 (1) There is an additional 215ktpa of combined capacity at Western Sydney and Acacia Ridge (Qld) paint lines; (2) idling of MCL 5 has reduced available capacity by around 230Ktpa Page 32 Major changes over the last two years to match capacity to demand and to improve efficiencies

• Reduced manning and loading outbound coal at bulk berth; loading outbound coke Shipping berths on No1 Products Berth

Cokemaking • Closed one battery; now operating 3 batteries (closed No. 4) and 21/22 Blowers

Sinter Plant • Reduced production rate

Blast Furnaces • Shut down No. 6; operating No. 5

BOS • Operating two vessels (closed No. 3) Port Kembla Steel Treatment • Reduced manning

Slab Casting • Closed No. 1, operating two strands

Hot Strip Mill • Reduced shift operation

Skin Mill • Reduced shift operation

Plate Mill • Reduced manning

Page 33 Major changes over the last two years to match capacity to demand and to improve efficiencies (cont.)

Cold Rolling • Reduced load (no export)

Springhill Metal coating • MCL1 converted and capable to produce Next Generation ZINCALUME® steel; MCL3 in process of conversion

Painting • Reduced shift operation

Hot Strip Mill • Closed

Cold Rolling • Reduced shift operation Western Port Metal coating • Mothballed MCL5 and reduced shifts MCL6; MCL4 converted and commissioning to produce Next Generation ZINCALUME® steel

Painting • Reduced shift operation

Page 34 Examples of business improvement initiatives: cost saving initiatives

1. Hot rolled coil transported to Western Port by rail – a cheaper and more reliable option than marine transport

2. Iron sands mix (from NZ Steel) used as feed material to the sinter plant – displacing external iron ore purchases

3. Use of our own burnt lime in the sinter plant (replacing purchases)

4. Reclamation of iron ore from the storage and blending yards – previously viewed as being too hard

5. More extensive use of recycled ferrous material through the iron and steelmaking process

6. Sharing maintenance spares between departments – previously, siloed behaviour prohibited this approach

7. Improving scrap management – ways to get higher value through different channels and preventing aged stock rather than economic disposal of aged stock

Page 35 Examples of business improvement initiatives: market facing initiatives

1. Sale of coke to export. We have deliberately configured our plant to enable export coke and drive additional revenue for the business. Focus on ensuring the appropriate quality and changing our process as a result to maximise returns

2. Development of a new Low Glare DECKFORM® Steel product that has the potential to displace 5,000 tonnes or more of imports. Collaborative work between R&D, manufacturing, sales and supply chain

3. Multi-slit galvanised coils at Western Port. Creating an additional 300 tonnes per week of product sales and displacing imports. Teams from across Western Port, Logistics and Sales working together to meet the customers expectations.

4. Western Sydney Service Centre producing 2 tonne horizontally packed coils and dispatching them directly to customers (to save transportation and reprocessing costs at Chullora)

5. Victorian Processing Optimisation – long term cross business view of Processing asset requirements instead of internal only view

Page 36 More cost effective iron ore blend

Iron inputs into Sinter Machine Iron inputs into Blast Furnace

Fine iron ores and recycled materials are Sinter and lump iron ore are added to blended and fluxed in Sinter Machine to the Blast Furnace produce Sinter SINTER

NZ Iron Sands Recycled Materials

LUMP IRON ORE

Yandi Fines Mt Newman Fines Mt Newman Lump

Page 37 Supply and pricing of iron ore and metallurgical coal to PKSW

Supplier Term Approximate Volume (p/a) Pricing Basis

10 years from Linked to average monthly index in the month of BHP Billiton Up to 4.18Mt1 lump & fines 1 July 2009 shipment Iron ore

New Zealand Steel Short term contracts 0.15Mt iron sands Linked to average index 15 days prior to shipment

Product / Supplier Term Pricing Basis Approximate Volume (p/a) Hard coking coal; BHP Billiton 30 years from Market based pricing linked to BHP Billiton sales to minimum volume linked to (Illawarra Coal) 1 July 2002 contract customers blast furnace requirements

Peabody Energy Until 31 March 2014 PCI Coal; 300-400Kt1 Agreed quarterly pricing

Various suppliers for Metallurgical coal Metallurgical production of export Short term contracts Coking coal as required Agreed monthly & quarterly pricing coke

Note: 1) reflects agreed reduced annual volumes post closure of No.6 Blast Furnace at Port Kembla

Page 38 Impact of restructuring

CIPA1 employee numbers

5,272

4,339 4,224

2 FY11 FY12 FY13

Note: 1) CIPA employee numbers include: CIPA Manufacturing, CIPA Sales & Marketing and CIPA Supply Chain & Processing 2) FY2013 is based on April 2013 position Page 39 The monthly Sales & Operation Planning (S&OP) cycle provides operational and financial integration across CIPA

Demand Review

Supply & Product Logistics Review Reviews

Management Review

Page 40 Community engagement in the Illawarra

Life Education Australia - Mobile school education facility Citizenship program for disabled and able bodied young athletes • High-profile community partnership program established in the Illawarra with WIN Network (headquartered in the Illawarra) – the largest regional TV network in Australia • Policy of supporting health, safety, environment, diversity, youth and education • Funding decisions made against established criteria to promote worthwhile community programs/projects • Independently managed by a local not-for-profit, along with representatives from BlueScope and WIN

• ~$500,000 in sponsorships and donations supporting 30+ Southern Stars community organisations 2000 strong school spectacular

Surf Lifesaving BlueScope Youth Orchestra Urban Grown – Community farm Telephone counsellor New Jet Ski Foundation sponsor (27 years) Sustainable farming – jobs for disadvantaged recruitment program youth Page 41 BlueScope environmental performance – resource efficiency & GHG measures

• The reduction in operations at Port Kembla Steelworks, the closure of the Western Port Hot Strip Mill and other associated changes in downstream operations have contributed to significant changes in BlueScope’s group environmental footprint

9 BlueScope’s freshwater consumption 9 The changes have contributed the majority of a 40.1 PJ (26%) energy has fallen significantly, with an overall reduction and a corresponding 4.45 million tonne (28%) reduction in CO2 reduction in use of 2,677 ML (~14%) emissions in FY2012 9 We have managed these changes such 9 FY2013 data will reflect the first full year of operations at this new level, and that the percentage of recycled water further Energy and GHG emissions reductions will be reflected in these contributing to the total water demand 9 While the Energy and GHG emissions intensities have deteriorated as a has continued to increase, reaching a result of the changes in economies of scale, BlueScope Steel remains new record level of 41.5% in FY2012 focussed on continual improvement off the new production baseline

Page 42 Building Components & Distribution Australia

Page 43 Overview of segment

• The Building Components & Distribution Australia (BCDA) segment, effective from FY2013, brings together BlueScope Steel’s LYSAGHT and Distribution businesses • The Australian solutions businesses (Buildings, Water, Ranbuild, Highline etc) are now part of the new Global Building Solutions segment • Sheet & Coil Processing is included in the Coated & Industrial Products Australia segment

LYSAGHT Steel & Tube Distribution Sheet Metal Supplies & Impact Steel y Roofing y Plate y Hot rolled coil y Walling y Tube y Cold rolled strip y Rainwater goods y Structural steel y Metallic coated coil y Fencing y Merchant bar y Painted coil y Home improvements y Reinforcing steels y Plate y Structural products y Rural products y Stainless steel y Mobile roll forming y Pipes, valves & fittings y Aluminium y Specialty steels y Processing services y Processing services

Page 44 Role of BCDA in BANZ

• Aim for positive cash flows and profits, achievement of hurdle rates of return and pull through tonnes to benefit the integrated chain • To achieve this, BCDA must: – Be a low cost steel channel to market – Ensure ongoing access to competitively priced steel products (vs. imports and spot markets) – Effectively manage inventories and the supply chain – Be a market leading processor / value adder – Deliver consistent service against customer expectations

Page 45 BCDA Locations

Darwin Legend 33• LYSAGHT 1 1 58• Distribution

11 20

Brisbane 1 9 2 2 Perth 11 10

Adelaide 4 14 Sydney

Sites 91 Melbourne Active Customers >20,000 3 2 Hobart Page 46 BCDA sales by market segment (FY2012)

Construction segment represents 65% of total domestic despatches

Agriculture & Mining

17% Auto & Transport Manufacturing 11% 8%

Construction - Engineering 6%

Construction - Dwelling 33% 26% Construction - Non Dwelling

Page 47 Distribution: Overview

• Over 58 locations and approximately 1,200 employees Australia wide, providing quality steel solutions to the residential, non residential, engineering construction, automotive, transport, manufacturing, mining and agriculture market segments • Supplies full range of steel products, including sheet and coil, plate, structural steel, merchant bar, tube, reinforcing, pipes, values & fittings, and specialty metals • Offers customers value added processing and supply chain solutions – plate profiling, beam processing, routing, cutting, sawing, drilling, slitting, shearing, inventory and warehouse management and next day delivery services • Our customer promise – superior customer service, technical expertise, innovation, quality and commitment • Works in conjunction with other parts of BlueScope to ensure a consistent and complete solution outcome for our customers • Leverages the brand equity in BlueScope products such as COLORBOND® steel, ZINCALUME® steel and GALVASPAN® steel and incorporates the warranties of these products to provide peace of mind for our customers

Page 48 Distribution business plan & focus areas

Get lean, fit & Target winning Optimise value Broaden view to hungry markets chain create growth

Customer & Sales Productivity Reduction of waste enhancement excellence Branch excellence

Steel efficiency Product Facility utilisation review rationalisation

Customer focussed technology & Scrap reduction One Best Way SLOB reduction innovation

TRIPLE A CULTURE Page 49 Distribution: Vision

“to deliver sustainable, profitable growth by positioning BlueScope Distribution as the preferred business partner to customers throughout the value chain”

Page 50 Distribution: Core products

Steel & Tube Sheet & Coil Plate Hot Rolled Hot Rolled Structural Cold Rolled Tube Galvanised Merchant Bar ZINCALUME® steel Pipe, Valves & Fittings TrueCore® steel Reinforcing & Rural COLORBOND® steel Aluminium

Page 51 Distribution: Processing solutions

Value added processing services provided include: • Plate profiling • Slitting • Drilling • Shearing • Cutting & Sawing • Recoiling • Routing

Page 52 Distribution: Restructuring program

• During FY2012 Distribution implemented a comprehensive restructuring program

• Focus was on lowering costs and better aligning BSD to customer demand

• Continue to strive for Zero Harm through engaged workforce participation

• Restructure program has achieved significant cost reductions, along with productivity improvements

• Additional business improvement initiatives have been indentified focused on: – Customer and Sales Excellence – People and Branch Excellence – Productivity Enhancement

• Business is aiming to increase volume and has targeted initiatives underway, however market demand continues to remain weak

Page 53 LYSAGHT: Overview

• Over 30 locations and close to 900 employees around Australia, providing a unique service capability unsurpassed by our competitors

• Manufactures and markets an extensive range of roll formed steel products for the building industry with specific offerings into the residential, commercial, structural, home improvement, distributor and shed segments

• Trusted steel supplier with over 90 years of operations in Australia, 100% Australian steel supply, unmatched technical expertise and quality service

• Works in conjunction with other parts of BlueScope to ensure a consistent and complete solution outcome for our customers

• Leverages the brand equity in BlueScope products such as COLORBOND® steel, ZINCALUME® steel and GALVASPAN® steel and incorporates the warranties of these products to provide peace of mind for our customers

Page 54 LYSAGHT business plan & focus areas

Get lean, fit & Target winning Optimise value Broaden view to hungry markets chain create growth

Deliver on customer Reconnect with Differentiated Expand footprint promise customer base products and into emerging services markets Deepen One best way understanding of market Achieve customer Grow high value service promise segments LYSAGHT brand Operational effective and efficiency relevant

National approach Upgrade service Partner with key Optimise to key market offers and profiles customers production footprint segments

TRIPLE A CULTURE Page 55 LYSAGHT: Vision

Australian Service Half Round Gutter Quality Klip-lok ® LYSAGHT The trusted experience in steel

Technical Heritage Expertise

Custom Blue Orb ® Custom Orb ® Heritage Red TM Dune TM

Page 56 LYSAGHT: Channel to Residential and Non-Residential Market Segments

MARKET SUB-SEGMENTS

Residential Building

Construction Industry Commercial • Roofing Contractors Building LYSAGHT • Building Contractors Roll formed Product • Fencing Contractors Sheds • Shed Manufacturer’s • DIY

Structural Segment

Reseller Network Home Improvements inc Fencing

Page 57 LYSAGHT: Core products and brands

• Roofing for the residential and commercial segments in profiles such as CUSTOM ORB®, TRIMDECK® and KLIP-LOK® 406

• A walling range that gives flexibility to suit any architectural style or environment

with brands such as MINI ORB® CUSTOM ORB® Night Sky TM

• Fencing profiles such as NEETASCREEN®, SPANSCREEN® and SMARTASCREEN

• Structural products such as battens, purlins and structural decking in brands such as TOPSPAN®, SUPAPURLIN® and BONDEK®

• Full range of rainwater products including gutters, fascia and downpipes NEETASCREEN® Domain TM

• Combinations of the above products also support Ranbuild and other shed customers in the manufacture of domestic, light commercial and industrial sheds

• Our LYSGHT Living Collection range of verandahs, patios, carports and decks are supported by products such as FIRMLOK® and FLATDEK®

SUPAPURLIN®

Page 58 LYSAGHT: Recent Innovations

• LYSAGHT has a strong pipeline of product development with expected range enhancements across the segments we service. • Recent and imminent releases include: – Patented four panel fence structure using less posts for better aesthetics and quicker installation – New roofing profiles and systems – LYSAGHT DIY Carport – LYSAGHT Living Collection range of custom designed Patios, Verandahs, Decks and Carports

Page 59 New Zealand & Pacific Islands

Page 60 NZ&PI assets, products & markets: Overview of New Zealand & Pacific Island sites

Glenbrook Integrated

Waikato North Head Mine

Taharoa Mine

Page 61 NZ&PI assets, products & markets: Glenbrook overview

Raw Material Yards

Iron & Steel Making

Coating & Finishing

Rolling Mills

Page 62 NZ&PI assets, products & markets: Annual capacities

Glenbrook Steelworks Steelmaking 670 Slab casters 670 Slab

Hot strip mill Hot rolled coil 750

Coupled pickled cold mill Cold rolled 380 coil Metal coating lines Metal coated 230 strip Paint line Painted strip 65 Heavy Plate mill 25 Light Plate mill Plate 90 Hollow sections mill Pipe & tube 45

Note: Numbers reflect mill capacity in kilotonnes Page 63 NZ&PI assets, products & markets: Unique process to directly reduce iron sands

Page 64 NZ&PI assets, products & markets: Steelmaking raw materials

Iron Sand Concentrate (Waikato North Head Mine) y Iron sand mined and concentrated on site – 58.5% Fe y Sufficient resource for long term steel making operations y Concentrate is slurry pumped 18km underground to Glenbrook y Low cost captive iron units y High value vanadium by-products captured through iron making process

Thermal Coal y Multi-source domestic and imported coal y Approximately 0.8Mt transported by rail to Glenbrook each year

Lime (McDonalds Lime - 28% NZS owned) y 34Ktpa lime (oxide and chip) quarried and processed at Otorohanga y Railed and trucked to Glenbrook

Page 65 NZ&PI assets, products & markets : Key product categories and applications

Product Primary end use markets Applications

Plate • Manufacturing, building and construction • Infrastructure projects, mining equipment and structural and mining applications including welded structural beams

Hot rolled coil • Building and construction, mining, • Racking, guard rails, building and construction products, automotive and transport, manufacturing structural tubing and water pipelines,

Cold rolled coil • Agriculture and petroleum • Packaging (drums) and storage systems

• Building and construction and • General manufacturing, structural sections for commercial and Galvanised (including manufacturing, industrial buildings, structural decking and residential framing GALVSTEEL™ )

Zinc/aluminium alloy-coated • Building and construction • Commercial and industrial construction including roofing, ZINCALUME® steel cladding, and rain water goods AXXIS ® STEEL • Residential framing solution Painted (including pre-painted • Building and construction • Residential, commercial and industrial construction including COLORSTEEL® ) roofing, cladding, fencing, rain water goods, architectural panels, sheds and garages

Hollow sections • Agriculture, construction and • Agricultural applications, including machinery and dairy systems. manufacturing Building scaffolding

Steltech (Welded Beams) • Building and construction • Multi storey applications, industrial and commercial construction, bridges

Page 66 NZ&PI assets, products & markets: NZ market at a glance

Total market size within New Zealand CY2012 (Kt) End use segments (NZS domestic despatches)

Long Imports Infrastructure 29 16%

Pacific Steel 250 120 New Zealand Manufacturing / 53% (long) Building & Steel (flat) Agriculture Construction 31%

56 Flat Imports

NZ Steel Value Stream

Rollformers & Building & Construction Distributors Installers Builder/Developer Building Owner

Manufacturing (Agriculture Included) Distributors Manufacturers Reseller Distributor End User

Council/Govt Infrastructure Manufacturers Installer/Developer Distributors Asset owner

Page 67 NZ&PI assets, products & markets: 1H FY2013 despatch mix

261kt

Main export markets: • Australia Export 136kt • North America

Export • Pacific Islands

HRC Plate CRC Metal Coated Painted Other

Domestic 125kt Domestic

Six months ended Dec-2012 Page 68 NZ&PI assets, products & markets: Better profitability in coated and painted products

Category Summary

Hot Rolled Coil • Ingredient products, typically substantially transformed into final Limited goods Plate product • Import parity pricing (IPP). NZS offer principally differentiated by differentiation service offer, supply reliability and product quality – with Cold Rolled Coil corresponding price premium

• Make use of sophisticated coating technologies, important to product durability in end applications Increased Aluminium Zinc coated • NZS’s products principally differentiated by product diversity, product product Galvanised coated quality and reliability, reputation (brand), and service offer with small differentiation order quantities • IPP influences pricing • High quality water based painted products designed for the New Zealand environment with superior durability COLORSTEEL® Most • NZS’s products differentiated by strong consumer brand preference, prepainted steel differentiated product warranties, product reputation and supply offer complexity • Intermaterial pricing most influential

Page 69 NZ&PI assets, products & markets: Taharoa mining and expansion 2012

Mining and Processing • Mining land and mineral title owned by a Maori trust • Mining free-flowing sands via dredge and floating concentration plant • Typical magnetic content of mined sand 40% to 50% • Fresh water resources are as important as the iron sand resources. Very low environmental impact • Current mining & concentration capacity is 1.5 Mtpa; shipping capacity ~1.35 Mtpa

Taharoa Shipping • Taharoa loading facility is via a slurry pipe line, 3kms offshore • Use specialised vessel MV Taharoa Destiny (replaced 22 year old vessel). In service since May 2012 • Increased loading capacity by 40% • Enhanced safety, speed, and product loading

Page 70 NZ&PI assets, products & markets: Waikato North Head – different mining methodology given different sand structure

• Consolidated rather than free flowing sand. Dry mining method via bucket wheel excavator • Deposit is very different to the Taharoa deposit – Lower valuable mineral content – But higher Fe product • Average magnetic content of between 20% and 40% through the depth of the resource but highly variable between lithologies • Very low environmental impact

Mine Face

Concentration Plant

Concentrate Stock

Tailings planted in Forest

Settling Ponds

Page 71 NZ&PI assets, products & markets : Iron sands shipment model

Taharoa iron sand legacy model Iron sands exports (Mt) • Dedicated slurry vessels • 40 to 50 day cycle time Waikato North Head 1.7 • System constrained by vessel Taharoa 0.3 • Port expansion to accept 175,000 DWT 1.2 0.2 0.9 0.9 0.8 0.7 1.4

0.9 0.9 1.0 0.7 0.8

FY2008 FY2009 FY2010 FY2011 FY2012 FY2013f

Iron sands volume growth driven by: • New larger vessel Taharoa Destiny – Increased capacity – Faster turn around Waikato North Head iron sand model Transhipment model • Ability to ship export out of Waikato North • Commenced 2012 • Commenced 2012 Head (WNH), with agreement of NZ • 14 day cycle time • Pumped to Glenbrook & road to Port government of Auckland • Greatly increases slurry • Ability to trans-ship via Port Kembla vessel utilisation • Charter 40,000 DWT vessels • Range of shipping solutions opens up new • Combined coal and irons and logistics markets and customers when possible Page 72 NZ&PI assets, products & markets: Uses of iron sands

• Iron sands are common geologically, but uncommon on the seaborne trade • Demand for low cost Fe units is increasing • An increases in the number of pellet plants in China is also driving demand

Lump 6mm – 31 mm

Fines Iron ore Iron sand in sinter operations: 1mm – 6 mm Sinter Blast Furnace • Has been used at 20% blend ratios • No affect on sinter quality at blend Taharoa ratios < 5% blend 180 μm Iron sand WNH Iron sand in pellet operations: 150 μm • Has been used at > 60% blend ratios Pellets • 100% pellets are possible

Concentrate < 75 μm

Page 73 Examples of business improvement initiatives: cost saving initiatives

• Recycling of previously dumped par processed raw materials

• Use of alternative imported coal sources

• Recycling of previously by-products in steelmaking

• Redesign of maintenance team with significant role reductions

• 6% reduction in FTE across steel assets with no asset closures

• Changed contractor arrangements for major capital shut work resulting in lower cost and reduced time to complete

• 10% increased in iron making capability through a range of initiatives in the kilns

• Extended WNH and Taharoa operations to 24/7 to allow iron sand market expansion and growth

• Change of roster arrangements in rolling mills, pipe mill to provide flexibility and lower cost

• 20% improvement in WNH iron sand production through de-bottlenecking improvement team activity

Page 74 Examples of business improvement initiatives: market facing initiatives

• Export sales of iron sands from Waikato North Head

• Dynamic costing models developed to allow assess best option of HRC sales vs. iron sands sales

• Introduction of new COLORSTEEL® Maxx product range, run rate of an additional 1,000t of sales p.a.

• New cattle rail products introduced with potential for 1,500 tonnes of sales p.a. replacing imported product

• Differentiation of aggregate products to allow for increased value added product sales

Page 75 NZ&PI business plan & focus areas

Get lean, fit & Target winning Optimise value Broaden view to hungry markets chain create growth

Market Innovation Delivery Supply Chain Back 2 Basics performance efficiency Product Innovation

Leading through Quality products & Energy Iron Sands our people services management Expansion

Talent Pipeline Flexibility to meet Productivity Product & margin the market Business Development

TRIPLE A CULTURE Page 76 NZ&PI business plan & focus areas: Pacific Lysaght Growth continues as we look to broaden product range and territories

New Caledonia Vanuatu Fiji • New facility in North opened in Feb • Continue to build market for low • New territory exploration for JV 2013 – performing ahead of plan cost steel intensive housing. – Solomon Islands • New territory exploration for JV – • Agricultural sheds Tahiti • Light steel framing solutions for distribution through the pacific • PEB solution for housing in North • Nexus Building Solution

BlueScope Acier Nord, New Caledonia Page 77 NZ&PI business plan & focus areas: Product and systems innovations and value chain management

Concept Develop Product Manufacturing Proving Proving Market Launch No. of Projects 12 8 3 3 4

Warmframe TM Vintage Patina Box Section COLORSTEEL® Systems Bounce™

Page 78 Markets: Residential construction approvals trending higher – Christchurch rebuild underway

Monthly number of New Zealand residential construction approvals1

(Number per month) 4,000

3,500

3,000

2,500

2,000

1,500

1,000

500

0 Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar 02 03 04 05 06 07 08 09 10 11 12 13

Source: Statistics New Zealand. Series ID: SSC11AS.

(1) Based on total number of new dwellings consented on an unadjusted basis. Data to March 2013 Data includes apartments. Figures for new apartments are compiled from consents that have 10 or more attached new dwellings. Consent definition: A building consent is the formal approval issued by a Building Consent Authority (BCA) to ensure certain works meet the requirements of the Building Act 2004, Building Regulations and New Zealand Building Code Page 79 NZ&PI business plan & focus areas: Continued growth in iron sands and non-steel businesses

Iron sands expansion: Iron sands exports (Mt) • New mining methodology being introduced to mine existing 1.7 geology and allow for expansion Waikato North Head • Expansion scheduled completion Nov 2013 Taharoa 0.3 • Will deliver production increase of 1.5Mtpa – at infrastructure capital cost of A$30/t, compared to capital cost of greenfield/ brownfield expansion in WA of $150 – 1.2 190/t 0.2 • Increased production off take will be transported via second vessel – anticipated delivery during 2H CY2014 0.9 0.9 – Targeting total export volume run-rate of at least 2.7Mtpa 0.8 0.7 • Evaluation of further shipping capability 1.4

Other non-steel opportunities: 1.0 0.9 0.9 0.8 • Expanding Vanadium recovery / sales capability 0.7 – Increased Vanadium production volumes – Trialling sales to new customers and geographies • Continue to generate revenue from non core activities eg aggregate sales, consultancy and other by products (iron oxide) FY2008 FY2009 FY2010 FY2011 FY2012 FY2013f

Page 80 Summary & Questions

Page 81 Summary

• Market factors still seemingly at ‘bottom of the cycle’ (construction activity, A$ and spreads); we are acting on matters in our control – Made the necessary changes to business mix and strategy – Working smarter – lean, fit and hungry culture – Targeting winning markets and new products; innovation

• Positioned to benefit as market conditions recover

Page 82 Appendices

Page 83 Appendix: Financials for BANZ Segments

Page 84 Segmental financials

1H FY2013 FY2012 CIPA BCDA NZS Interseg Total CIPA BCDA NZS Interseg Total

Steel despatches (kt) 1,248 364 261 3,544 758 580

Revenue 1,668 720 319 (338) 2,369 4,280 1,486 755 (710) 5,811

EBITDA (underlying) 79 2 27 (4) 104 (151) (27) 113 3 (62)

EBIT (underlying) (6) (7) 2 (3) (14) (327) (46) 69 3 (302)

EBIT (reported) 7 (10) 2 (4) (5) (726) (227) 65 3 (885)

Capital & investment expenditure 56 3 19 - 78 110 6 42 (1) 157

Net operating assets (pre-tax) 1,973 324 339 (12) 2,623 2,003 329 296 (9) 2,620

Page 85 CIPA: breakdown of 1H FY2013 revenue

CIPA revenue 1H FY2013 Steel despatch volume 1H FY2013 $1,668m 1,248kt Non-steel Export prices are business Export 345kt generally sensitive to • Export coke regional steel prices • Cold ferrous • By-products Export HRC Plate CRC Metal Coated Steel business Painted Domestic 903kt Other

Domestic Most domestic non-painted steel prices are largely sensitive to regional steel prices, though timing and degree of relationship can vary Six months Six months ended Dec-2012 ended Dec-2012 Page 86 CIPA: breakdown of 1H FY2013 underlying cost components

Non-steel business costs relate to: • Export coke sales A$1,674m • Cold ferrous feed to Conversion & Overhead (scrap pool) Non-steel business Components (in order of value): costs • By-products (eg. Tar, BTX, Sulphate) • Direct labour • Repairs & maintenance • Sales & administration Conversion & • Services & contractors overhead • Utilities • Consumables Freight • Other (includes $36m one- Depreciation (in order of value): off workers compensation • Domestic despatches Freight benefit) • Export despatches • Internal (eg. Springhill & Western Port to Service Raw materials Centres) (in order of value): • Iron ore Raw materials • Coal • Scrap • Fluxes and alloys • Paint • Zinc • Aluminium 1H FY2013

Page 87 BCDA: volume and costs

Product mix 1H FY2013 (by volume) Components of underlying costs in order of size • Steel feed / purchases • Labour • Freight • Facilities / leases • Depreciation • Other

Metal Coated Reinforcing Plate HRC Painted Other Tube Structural Merchant bar

Page 88 NZ&PI: breakdown of 1H FY2013 underlying cost components

A$317m Conversion & Overhead components (in order of value):

• Direct labour • Utilities • Services Conversion & • Consumables overhead • Selling, general & administration

Raw Materials (in order of value): Depreciation • Coal • Scrap Freight • Iron ore • Zinc • Alloys • Paint Raw materials • Aluminum • Other coatings

1H FY2013

Page 89 Key earnings drivers

Coated & Building New Zealand Industrial Components & & Pacific Steel Products Distribution Products Australia Australia

• Selling prices • Despatch volumes • Selling prices of steel • Material costs – • Product and • Material costs – mainly including iron ore, segment mix coal, fluxes, alloys, and coal, fluxes, alloys, • Margins coating materials and coating • Foreign exchange • We own our iron sands materials (eg AUD/USD) resource, so just an • Conversion costs extraction cost applies • Foreign exchange • Conversion costs (eg AUD/USD) • Foreign exchange • Despatch volumes • Despatch volumes • Domestic / export • Domestic / export and and product mix product mix • Iron sands and vanadium revenue

Page 90 Appendix: CIPA Markets & Logistics

Page 91 Logistics and supply chain

Darwin

Cairns

National Logistics Network National & Metropolitan Road • National rail network – serving major cities Transport • Network of warehouses / distribution centres • Road delivery to metro and regional in local markets to service customers customers nationally • SteelLink: over 1.2Mtpa annually of BSL • Leverage across multiple BSL business Brisbane product units • Road transport networks: over 1.5Mtpa Outbound annually Export markets

Perth Sydney Adelaide Pt Kembla Works Inbound and Outbound Shipping • Inbound – iron ore (~ 4mtpa) and other Melbourne steel making raw materials • Exports – BSL’s steel products to markets Western Port Works in Asia Pacific, Europe and North America Inbound Raw materials

Hobart Page 92 Examples of product applications

Page 93 Appendix: CIPA Manufacturing

Page 94 BlueScope Australia and New Zealand History

1915 BHP commenced steelmaking in Newcastle 1979 John Lysaght becomes fully owned by BHP

1918 John Lysaght (Australia) founded 1989 BHP acquires 71% of New Zealand Steel

1925 BHP acquires Port Kembla Steelworks 2000 Long products division separated and listed on ASX as OneSteel 1928 Australian Iron & Steel Limited (AIS) was formed to operate a steelworks at Port Kembla 2002 BHP Steel listed on ASX

1935 BHP acquires Australian Iron & Steel Limited (AIS) 2003 Name changed to BlueScope Steel

1939 Lysaght Springhill plant opened and Commonwealth 2006 Exit tinplating business Rolling Mills (CRM) plant established as partnership between American Rolling Mills and John Lysaght 2007 Smorgon Steel Distribution acquired 1966 First COLORBOND® Steel Produced 2008 Western Sydney service centre opens 1968 New Zealand Steel operations commenced at Glenbrook 2011 BlueScope Australia & New Zealand business unit formed. producing GALVSTEEL™ Closure of some manufacturing facilities at Port Kembla 1970 Commissioning of iron and steelmaking at Glenbrook, Steelworks and Western Port to reduce exposure to export pioneering the direct reduction process to utilise iron sands markets. Expanded coke exports from PK using freed-up from Waikato North Head coke capacity 1971 BHP acquires 50% of John Lysaght 2012 Commenced exports of irons ands from Waikato North Head and expanded Taharoa exports 1972 Western Port works opens; commenced exports of Taharoa iron sands 2013 Manning reductions at Western Port to respond to low domestic demand 1976 ZINCALUME® steel was launched Page 95 Background: overview of main steel production processes

STEEL PRODUCTION SEMI’s FLAT PRODUCTS

Steel

Scrap ? Hot rolled strip Cold rolled Wide coil Narrow strip Cut lengths Slab mill strip mill Scrap Electric Arc Ladle Furnace

Electrical coil Metal Coated Painted coil Laminated coil SCRAP ROUTE coil

Molten Reversing mill Plate Steel ? Ladle LONG PRODUCTS

Continuous H-section I-sectionT-section U-section Z-section L-section Rail Casting Machine Bloom Heavy section mill MOLTEN IRON ROUTE Basic Oxygen Round Square Half Round Flat H-section I-section Furnace (converter) Bar/Section mill Molten Iron

Rod mill Wire rod Wire Wire Billet drawing Torpedo Ladle Blast Furnace

Seamless tube Tubes Welded tube mill mill

Page 96 Background: overview of main steel production processes

Integrated “Conventional” Slab Casting – 3 to 5 Mt/a 1-2m/minute Gas cutter Rougher Finisher Run out table – 500 to 800 m Coil box cooling Cooling 1-10mm thick 200-300 mm thick Coiler Reheat furnace 500-800 m 20-40 metric ton coil Minimill Thin-Slab Casting – 1 to 3 Mt/a 4-6 m/minute Finisher Run out table – 300 to 400 m cooling 1-10mm thick 50-60mm thick Coiler Holding furnace 300-400 m 20-40 metric ton coil Strip Casting – 0.5 Mt/a

15-150 m/minute – 60 m Run out table 0.7 - 1.8 mm thick Mill cooling Scale Control Chamber Coiler 60 m 20-40 metric ton coil

Page 97 Cokemaking process

GAS BTX PROCESSING SULPHATE (Benzene) BLENDED COAL TAR

COKE OVENS GAS Interworks energy (boilers, furnaces)

COKE PLANT COKE SCREEN

Cokemaking: • Pyrolysis of coking coal: coal heated to >1000ºC in absence of air LUMP • Largely carbon plus some hydrogen, nitrogen, sulphur and (25 – 80 mm) inorganic minerals TATA (20 – 50 mm) • 1.25t of coking coal generally produces 1 tonne of coke solids NUT (10 – 25 mm) Desirable physical properties of coke: BREEZE • Strong and large lumps (< 10 mm) • Able to withstand the blast furnace environment without generating fines • Irregular shape, so that it doesn’t pack tightly (permeability) • Very porous (react with blast)

Desirable chemical properties: • Low sulphur and phosphorus (steel quality) • Low ash (less slag, less fuel, lower hot metal cost) Page 98 Cokemaking

Page 99 Iron ore fines

• Typically 58-63% Fe; South American exception at 66% Fe • Generally the cheapest, due to lower %Fe and higher gangue • Not suitable for direct charge to blast furnaces (too fine, gets blown out as dust) • Requires agglomeration into larger solid forms such as sinter or pellet by: – Blending the fine ores to control chemistry & size

– Then add fluxes: limestone (CaCO3), dolomite (MgO) & serpentine (SiO2; MgO) – Add fuels (coke) – layered on a moving grate

SINTER

Page 100 Iron ore lump

• Typically 61-64% Fe • As received from the Mine, has <6mm material which are screened out and treated as Fines (“secondaries”). Yield normally 72% Lump (>6mm) • Remaining lump ore (>6mm to 60mm) is direct charged to BF

• However difficult to control chemistry – comes as “Mother Nature” including variability in SiO2, Al2O3, Phos, MgO, CaO etc • Therefore “non ideal” smelting in the BF – wide temperature range ; affects zones in BF • Generally limited to < 20% of Burden mix, however in lower productivity scenarios can use higher proportions • Comes with penalty of increased slag volume (gangue) and fuel costs

Ideal properties of lump: • High % Fe – yield of hot metal

• Low combined gangue (SiO2, Al2O3) = less slag volume (costs) • Low Phosphorus (P) = quality of steel • Low Loss on Ignition (LOI) – combined water = freight cost & fuel

• Low Specific Trace elements – Ti, V, Cr and alkali (Zn, K2O)

Page 101 Ironmaking

5 BF 6 BF

Sinter & raw materials handling PCI

Page 102 Sinter plant at Port Kembla

103Page 103 Blast furnace process

Raw materials: sinter, lump ore, coke & fluxes charged • Function of a blast furnace is to: through top of furnace – Remove oxygen from iron oxide – Remove gangue from the iron ore to form slag Excess hot gases flow from top of furnace to gas cleaning • Achieved through use of carbon plant and reused for heating monoxide gas from the 100 oC combustion of carbon from coke Layers of coke & ferrous & coal materials descend to bottom of furnace over eight hours – soften then Cast iron / copper melt and collect in the stave cooling system hearth

Molten iron drained from taphole in side of furnace Hot air + PCI blown into into brick lined torpedo furnace through 28 shaped vessels. ‘tuyeres’. • Temperature 1200 oC Slag converted to either • Pressure 370 Kpa ‘sand-like’ particles in a • Velocity 230 m/sec 2200 oC granulator or ‘rock slag’ o when cooled in pits 1500 C Carbon refractory lining

Page 104 Port Kembla blast furnaces

No.5 Blast Furnace (in operation) No.6 Blast Furnace (not operating)

No.5 No.6 Built 1972 1996 Relined 1978, 1991, 2009 - Inner Vol – m3 3,427 3,208 Work Vol – m3 3,000 (88%) 2,749 (86%) Output 2.6 Mtpa 2.6 Mtpa

Page 105 Basic oxygen steelmaking (BOS) process

Molten iron (260t) Oxygen blowing

Scrap steel (approx 50t)

Indicative ‘recipe’ of raw materials per output steel tonne: • 1.24t iron ore fines (sintering) • 0.26t lump ore (into BF) • 0.57t hard coking coal (into BF) • 0.15t PCI (into BF) • 0.18t scrap1 (into BOS) Refractory lined BOS furnaces ~ 280t per ‘heat’2

Note: 1) 40% of scrap feed is sourced externally; balance, internally sourced scrap. 2) Yield loss resulting from BOS process is due to impurities in the hot metal that are burnt off. Eg Carbon, silicon, phosphorous. Page 106 Slabmaking process

Steel ladle

Revolving Steel ladle turret

Tundish

Mould Oxy Cutter

Continuous Slab Casters Max. width = 2200mm Max. length = 12.5m Max. thickness = 300mm

Page 107 Hot rolling process

PKSW hot strip mill (HSM): • Commissioned 1955, upgrades 1972, 1985-1987 & 2000-2006 • 2.9 million tonnes per annum capacity

Product flow

Slabs ex Slab Coil box Casters Reheated to 1225°C Six Stand Finishing Mill min. gauge 1.48mm Dual reheat Roughing- furnaces Reversing Mill 300mm – 25mm

Page 108 Plate mill

PKSW plate mill: • Commissioned 1963 Slabs ex Slab • 5mm-180mm thick x 1200mm-3400mm wide Caster • 0.45 million tonnes per annum capacity

Reheat Furnaces

Roughing Mill Finishing Mill Hot leveller

Descaling Box

Shearing, stencilling & inspection Product flow

Page 109 Summary of steelmaking steps: inputs and conversion costs

Process Raw material inputs Main conversion costs Maintenance, labour, refractories & consumables, services (eg labs, Cokemaking Metallurgical coals cleaning, coal handling), depreciation; (Note: utilities is a net neutral cost due to coke ovens gas transferred to other units for energy) Iron ore fines, iron sands, limestone Services (eg materials handling, cleaning), maintenance, labour, Sintering fines, dolomite fines, recyclables depreciation, utilities, refractories & consumables

Ironmaking (blast Coke, sinter, iron ore lump, fluxes, PCI Services (eg materials handling, PCI, transport), utilities, depreciation, furnace) coal refractories & consumables, maintenance, labour

Steelmaking (BOS and Molten iron, scrap, alloys (eg ferro Labour, maintenance, refractories & consumables, utilities, services (eg manganese, molybdenum, aluminium), transport, contractors), cryogenic gases (argon, nitrogen, oxygen) slab casting) fluxes depreciation

Plate mill Slab Labour, maintenance, depreciation, utilities, services

Hot strip mill Slab Labour, maintenance, depreciation, utilities, services

Labour, maintenance, services, utilities, depreciation, refractories & Hot rolled coil Pickling and cold rolling consumables

Labour, maintenance, services, utilities, depreciation, refractories & Cold rolled coil, zinc, aluminium Metal coating consumables

Metal coated strip (generally Labour, maintenance, services, utilities, depreciation, refractories & Painting ZINCALUME® steel), paint consumables

Page 110 Western Port History

Why Western Port ? • Deep water port • Energy from Bass Strait/Latrobe Valley • Key southern states customers: – automotive, white goods, drum makers and building industry Milestones • 1968: Feasibility study undertaken for a new steel site • 1970: Joint venture signed and Victorian Government approval • 1972: Cold Mill and Metal Coating Line 4 commissioned • 1973: Pickle Line and Paint Line 2 commissioned • 1978: Hot Strip Mill commissioned • 1979: Metal Coating Line 5 commissioned • 1982: Paint Line 4 commissioned • 1992: Metal Coating Line 6 last major production unit commissioned • 2011: Hot Strip Mill decommissioned & MCL 5 mothballed • 2013: MCL4 upgrade Next Generation ZINCALUME® steel

Page 111 Western Port operations overview

Water Treatment Hot rolled coils arrive HRC Coil Plant Pickle Line via rail from PKSW Storage

Five Stand Mill Technical Bldg No.6 Galvanising Line Coil Annealing Maintenance No.5 Zincalume Line Services Bldg No 2 Paint Line Coil Temper Mill No.4 Zincalume Line

Coil transfer to Warehouse Paintlines CSP Warehouse / Slitter / Pack line

No 4 Paint Line Finished product to: • Western Port Wharf for export Finished Product: Main Gate • Despatched to customers via Admin road & rail Bldg

Bayview Road Page 112 Appendix: New Zealand & Pacific Islands

Page 113 New Zealand Steel History

• 1965 Company established • 2002 Brand changed to New Zealand Steel • 1968 First production of Galvanised Coil • 2003 Company renamed BlueScope Steel Limited • 1969 Production of Steel Billets • 2011 Executed long-term supply contract to double • 1972 Commenced iron sands exports from WNH Taharoa exports. Ship expected to be • 1984 Approval for an integrated flat products commissioned in 2H CY2014 business • 2012 Commenced iron sands exports from WNH • 1987 Commission flat products manufacture • 2012 Increased Taharoa loading capacity by 40% • 1989 Purchased by Helenus (BHP Steel) with New Vessel ‘Taharoa Destiny’ • 1992 100% BHP Steel ownership

Page 114 Brands

Page 115 Products: Overview

Iron sand concentration Hollow sections

Metallic coated coil Hot rolled coil Cold rolled coils

Page 116 Waikato North Head process schematic

Page 117 Taharoa existing process schematic

118 Page 118 Taharoa new process schematic

Buried Feeder (Dozer trap) Spiral Separation Plant Concentrate Stockpiles

Ship Loading – Stockpile to CD tank

Ship Loading Pumps SPM Buoy Ship Loading

Undersea Pipelines

119 Page 119 Once Taharoa 2.4 Mtpa rate achieved, BSL 55% hedged for iron ore

Portion of iron ore consumption economically hedged1 within BlueScope

2011 Today Future Before CIPA Restructure, combined 1.2 Mtpa iron sands exports from Expected 2.4 Mtpa iron sands exports with 0.8 Mtpa iron sands exports Taharoa, and exports from from Taharoa once second ship (9.2 Mtpa usage rate, including NZ) Waikato North Head operational, and exports from (5.0 Mtpa usage rate, including NZS) Waikato North Head (5.0 Mtpa usage rate, including NZS)

15%

40% 45% 55% 60%

85%

Economically hedged Unhedged portion of purchases Note:

1) Based on current market pricing ratio of iron ore fines to iron sands Page 120 Electricity is a key cost which is highly volatile and complex to manage

NZS Energy Sources $/MWh 2013 Electricity spot prices 250 Wind Other Geo-thermal 2% 200 8% Coal 2% 7% 150

100

55% Hydro 50 26% Gas 0 Jan Jan Jan Jan

Feb Feb Feb Feb

Mar Mar

Mar Mar

5 2 9 2 9 12 19 26 16 23 16 23

NZS Electricity Exposure • Third highest cost for the business

Spot • NZ has greater than 50% reliance on hydro generation 27% • High short term (5 min) volatility results in complexity to manage

57% Co-Gen • Effectively 60% self-sufficient in electricity – generation from high 16% demand units Hedge • Hedging strategy developed and now in place

Page 121 Community involvement

Engagement with the community through participation in various committees and fostering good working relationships with key community stakeholders

• Community Environmental Committee Formed in the 70’s with representatives from local government, health, cultural and rural groups.

• Community Liaison Group Forum for open discussion and information sharing of NZ Steel, local neighbour ratepayers groups, Auckland Council • Education Sector Involvement with secondary schools; Workchoice Day, LEARNZ on-line interactive visit • Public tours of NZ Steel Schools, universities, community groups, customers, suppliers etc

Page 122 NZ&PI is committed to reducing our impact on the environment

• 60% of electricity generated from waste gas

• 99% of process and storm water is reused or recirculated

• 100% of process steam generated from waste heat

• 100% sale of Iron oxide sold into water treatment & magnet production

• ~200ktpa aggregate recycled into applications such as road base, drainage & construction

• ~18ktpa mill scale recycled replacing energy intensive gaseous oxygen

123Page 123 BlueScope Australia & New Zealand (BANZ) Investor Briefing Day

30 May 2013

BlueScope Steel Limited. ASX Code: BSL