29 Sep 2016

Our story so far

British Steel, the newly-formed steel manufacturer, is pleased to announce that it's on track to return to profit for the financial year ending 31 March 2017. 

  • Turnaround plan on track and business back in the black
  • £50m of capital investment committed in annual plan
  • Major support from customers and suppliers
  • 270 new employees, including 48 apprentices 
  • New Executive Chairman
  • Revenues improving month-on-month
  • Engaging with Government to ensure a level playing field for UK steel industry

The company, launched on 1 June, is well on course to complete its return to sustainable growth, after successfully implementing the first stages of its turnaround plan. In addition to efficiency and cost saving initiatives, £50m of capital investments have been committed for this financial year. This investment has been focused on several major projects to improve competitiveness and broaden the offering to customers. These include:

  • £7m investment in the replacement of gasholders
  • £10m investment to improve efficiency and reliability of Appleby Coke Ovens and By-Products
  • £4.2m investment in Scunthorpe’s Basic Oxygen Steelmaking Plant
  • £1m investment in Hayange Plant’s New Main Drive Armature

Since 1 June suppliers and customers, existing and new, have been keen to do business and have been very helpful working with British Steel to create value. These include Caterpillar, Toyota, Network Rail, Cargill, William Hare, Apollo, Vesuvius and Elland Steel Structures.

As part of the turnaround plan, British Steel is investing heavily in training a new generation of highly-skilled steelworkers. Since its launch on 1 June, 270 new people have joined the company, many of them youngsters. The new employees include:

  • 48 young people serving three-year craft or functional apprenticeships
  • 80 former agency workers given full-time British Steel contracts
  • 7 degree apprentices gaining university qualifications alongside practical experience
  • 17 graduates joining as full-time employees
  • 16 undergraduates on placement schemes, many likely to join full-time when they’ve completed their degrees

British Steel’s Executive Chairman Roland Junck said: “I am delighted to be able to announce that we have hit our performance targets and returned the business to profitability in our first 100 days as an independent company.

“These results are testament to the hard work of our employees and their determination to implement the turnaround plan.

“I believe we are now better placed to capitalise on our strong heritage, vastly experienced and skilled workforce and world-class products. The transformation of our business will make sure we maintain the pace of growth and move forward as an outward-looking profit-making business. But while our future remains firmly in our hands, the UK steel industry still faces many challenges.

“That is why we are pleased to remain in constructive dialogue with the Government about the strategy needed to support British Steel and ensure that it is operating on a level playing field.

“It goes without saying that any such strategy must be long-term and cross all political divides if it is to achieve the goals we all share.”

British Steel’s core business is rail, sections, wire rod and special profiles and it has put customer service and product innovation at its heart.

Network Rail is one of British Steel’s main partners, with 98% of the rail it lays in the UK manufactured at the Scunthorpe plant.

Mark Carne, Chief Executive Network Rail, said: “Network Rail has great confidence in the UK steel industry and we’re very happy to be using rail made by highly-skilled workers at British Steel, which has made such a promising start to business. 96% of our spend on steel rail is at the Scunthorpe plant. There are few other companies of our size who can show such a clear commitment to buying British and we’re proud that British Steel is helping us deliver our Railway Upgrade Plan.”

Caterpillar (CAT) and British Steel have adjoining operations at Skinningrove, Teesside, where products made by British Steel’s special profiles operation include steel track shoes. These are used on CAT’s renowned 'Cat track', which can be found on hydraulic excavators, track type loaders and track type tractors.

Neil Anderson, Managing Director Caterpillar Skinningrove, said: “We are a long-standing customer of British Steel and we are delighted to be working with them on a number of significant projects. By working together as a team I am confident we can make both businesses more competitive in the future.” 

Billington Structures is one of the UK’s leading structural steelwork contractors and predominantly utilises British Steel sections, manufactured in Scunthorpe and Teesside, in many of its major projects, including RAF Brize Norton, Oxfordshire, One Bedford Avenue, London and Next Distribution Centre, Doncaster.

Mark Smith, Billington CEO, said: “We are thrilled the British Steel brand has re-emerged as they have been our key partner for steel supply since 1993, providing over 375,000 tonnes. Working closely with British Steel allows us to supply our customers with the quality products and services they demand. It is hugely encouraging to see the new business making great progress.”