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BSI STEEL LIMITED - Strategic update

Release Date: 06/02/2014 17:15
Code(s): BSS     PDF:  
Wrap Text
Strategic update

BSI STEEL LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2001/023164/06)
JSE code: BSS
ISIN: ZAE000125134
(“BSI” or "the company")


BSI STEEL LIMITED – VOLUNTARY STRATEGIC UPDATE


At the time of publishing the unaudited interim results for the
six months ended 30 September 2013, released on 7 November 2013,
the board stated in the Prospects paragraph that ‘The Group has
extensive knowledge of global commodity markets and supply
chains. We are exploring ways to exploit this knowledge on a low
risk, non capital-intensive basis.’


Shareholders are informed that initiatives are being explored in
two broad areas, as follows:

  -   Commodity Trading – with almost 30 years experience in the
      steel industry, the Group has significant insights into the
      raw material supply chains on which the global steel
      industry is dependant, as well as relationships with many
      major players in the industry, including miners, shippers,
      steel producers and downstream customers. We have
      identified various prospects that, if successfully
      exploited, would allow us to trade in iron ore and related
      markets.
  -   Commodity Finance – our expanding African operations have
      highlighted the importance of project and trade finance
      throughout the steel industry supply chain, and have
      enabled us to establish relationships with some significant
      providers of finance and related services.


In order to capitalise on our expertise the Group is developing
plans, primarily based on joint venture relationships, which if
successfully implemented would allow us to participate in
commodity trading and trade finance. As far as possible these
initiatives will be pursued on a low risk, low capital-intensive
basis, in partnership with organisations well known to the Group
and which bring expertise in these areas. Our current intention
is to proceed cautiously, without taking principal risk, and to
grow any opportunities organically, and we are therefore not
pursuing any acquisitions in this regard.


It is premature to speculate on the potential impact of these
initiatives under investigation, although the Group will not
proceed unless we anticipate significant future benefits. No
material impact from any of these activities is anticipated in
our results for the current financial year to 31 March 2014.
Additional strategic updates will be provided once the Group has
greater certainty as to the likely timing and nature of these
planned ventures.


The Group continues to experience challenging trading conditions
affecting the steel industry as a whole. As in previous years,
our performance in February and March will significantly
influence final earnings for the year to 31 March 2014.


The information in this announcement has not been reviewed or
reported on by the Group’s auditor.


By order of the Board
6 February 2014
Johannesburg


Sponsor
Sasfin Capital (a division of Sasfin Bank Limited)

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