- Reports & Corporate Governance
In 2007/08, we released the BlueScope Blueprint that sets out a three-year plan to sharpen our businesses across the globe. The aim of the Blueprint is to increase the value we derive from our Company. This will be achieved through three major objectives: reinvigorating our Australian and New Zealand domestic businesses, continuing to improve our Asian and North American businesses, and growing or acquiring new businesses that build on BlueScope Steel's distinct competitive advantage.
The Blueprint comprises eight key areas, or ‘Basics‘. These are: increasing customer and market focus, improving productivity year on year, optimising return on capital, building an integrated BlueScope operating system, further developing organisational capability, continuing our world-class safety performance, improving our environmental footprint and the sustainability of our products, and increasing shareholder value.
Over 200 Blueprint initiatives have been identified. These are specific projects designed to contribute to the achievement of Blueprint objectives. At the close of the 2007/08 financial year, 120 initiatives were underway, aimed at improving EBIT and working capital. Implementing these initiatives is a complex undertaking, so a Project Management Office has been established to monitor the progress of the Blueprint objectives.
The Blueprint is about changing the things we can change.
While factors like global steel prices and foreign exchange rates are beyond our control, we can influence many business fundamentals such as market share, productivity, safety, water use and emissions.
A major Blueprint objective is building competitive advantage through acquisitions or growth. This concept is illustrated through two major acquisitions completed during the year. In August 2007, we acquired Smorgon Steel Distribution at a cost of $750 million. This acquisition and the subsequent integration into our new Australian Distribution and Solutions business gives us a network of 150 sites across Australia, representing an important new channel to market and a major increase in the customer-facing operations of our Company.
In February 2008, we acquired IMSA SteelCorp for US$730 million from Ternium S.A., a NYSE listed public company. IMSA Steel Corp comprises four different businesses that will give us a competitive edge in our North America mid and downstream markets. The IMSA Steel Corp operations also add value to our Company through business synergies. These include a broader portfolio of products and opportunities for synergies in purchasing. New acquisitions also bring new expertise, which can be pooled across our global operations.