2017 Half Year Report

Half Year Report 2017

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HALF YEAR REPORT 2017
Directors’ Report
FOR THE HALF-YEAR ENDED 31 DECEMBER 2016
Steel & Tube’s increased results for
the six months to December 2016
is against a volatile global steel
environment and an intensely
competitive domestic trading
landscape. The company continues
the momentum from the delivery
of the One Company initiatives
coupled with planning for the
refreshed strategy.
Results
Trading for the 6 months to
31 December 2016 saw net profit
lift by 7 per cent to $10.6 million,
excluding the proceeds of the
Bowden Road property sale from
the 2015 comparative period.
Revenue decreased by 4 per cent to
$254 million, reflecting the focus of
increasing margins, which improved
by almost 3 per cent to 25.4 per cent.
These results represent a full half year
for both MSL and S&T Plastics, both
acquired part way through the first
half of 2015, and two months
of trading from Composite Floor
Decks Limited (CFDL).
S&T Stainless, MSL and CFDL all
continue to perform well and in
line with expectations. S&T Plastics
took the opportunity to complete
extensive work to improve plant
performance and reliability in
preparation for already secured major
project activity through 2017 and into
2018. This improvement programme
impacted the first half net profit
result by $1.2 million, but the business
is expected to make improved
contributions through the second
half and into the next financial year.
Net operating cash remained strong
and improved by $4.6 million or
50 per cent to $14.0 million, while net
tangible assets per share reduced by
10 cents to $1.49 cents.

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Dividend
The Directors have declared a fully
imputed dividend consistent with the
first half last year at 9 cents per share,
and to be paid on 31 March 2017 to
shareholders of fully paid shares
registered as at 17 March 2017.
The total amount payable is
$8.1 million and a supplementary
dividend of 1.58 cents will be paid
to non-resident shareholders.
Board Refresh
As announced at the annual meeting
in November 2016, Sir John Anderson
signalled his intention to step down
in the first half of 2017 once a new
Chairman had been selected by
the Board.
As part of the Board refresh,
professional director Susan Paterson
joined the Board on January 16 2017
as Chairman – elect. The Board is
also progressing a search for another
director to join the Board in the first
part of 2017.
Performance
The drive to continue to modernise
the business capabilities continues.
S&T Stainless implemented the new
ERP system as the pilot for the entire
business during the half year. In line
with expectations, this has provided
great feedback to the project team
and preparations for the main
roll-out in 2017.
Progress continues on new facilities.
Our new purpose designed and built
facility in Dunedin is completed,
and the business took occupancy
in early February 2017.
Project planning for a new
Processing facility in Christchurch
are in their final stages along with
the refurbishment plans for the
Distribution facility along Blenheim
Road. These facilities are expected to
be completed late in 2017 and early
2018 respectively.
S&T Plastics took the opportunity of a
lull in major project activity to prepare
the plant for the next tranche of
irrigation investments. Pleasingly, the
business has received commitments
to supply three major irrigation
schemes that will be executed
throughout the 2017 calendar year,
which begin to demonstrate the
potential for this business.
In line with the new strategy,
enhancing capabilities across Steel &
Tube continued with the acquisition
of CFDL . This business compliments
the existing ComFlor® manufacturing
capability and provides a service
from specification, manufacture and
distribution to installation.
Facilitated in part by the new systems,
some parts of the business realigned
their costs, reducing total headcount
by more than 30 across the business.
The costs associated with this were

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HALF YEAR REPORT 2017
taken in the first half, and the benefit
will flow into the second half and
beyond. This will be an ongoing
focus for the business.
Globally the steel environment
remains volatile, with China
continuing to dominate the global
scene. Despite the raw materials
and finished steel fundamentals,
prices increased rapidly through
the early part of 2016, reaching
the domestic market by mid-2016
calendar year. Steel & Tube focussed
on price increases which has seen
a welcome lift to margins. While
Steel & Tube maintained its price
leadership position, some others
took the opportunity to take
volume, particularly in the more
commoditised distribution products
and within reinforcing. Surprisingly,
reinforcing prices are now at multi-
year lows despite the current
construction activity.
While this focus has impacted short
term volume, and consequently
revenue and market shares in some
products, the total market share
is tracking in line with longer term
expectations.
Seismic Mesh
We remain disappointed by the
Commerce Commission’s decision
to prosecute Steel & Tube along with
others around the seismic mesh.
The Commission’s decision for Steel
& Tube relates to the inadvertent use
of a testing laboratory’s logo on test
certificates, and the application of
testing methodologies. As indicated at
the annual meeting, there was always
the possibility that the Commission
would have a different perspective
on the testing issues. The expected
costs in relation to this prosecution
have been accrued for, as have any
proceeds that will be recovered under
the Group’s insurance policies.
Outlook
As reported at the annual meeting,
multiple factors, not limited to coal
production, steel capacity reduction,
increased consumption driven by
Chinese infrastructure and increased
derivatives trading for both raw and
finished steel products have all led to
significant volatility in the global steel
pricing scene. Coking coal peaked
above US$300 per tonne from US$90
per tonne in the last quarter of 2016,
while iron ore (62%Fe) is currently
in excess of US$80 per tonne, the
highest for three years.
This has led to a significant increase in
finished steel prices that is working its
way into product landing in
New Zealand in the first quarter
of calendar year 2017. Consequently,
a further round of price increases have
been signalled for this quarter.

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From a domestic perspective,
the outlook for the New Zealand
economy looks positive, with the key
downside risk remaining an external
global shock.
Domestically, many economists are
more confident about 2017, with
growth supported by low interest
rates, strong construction demand,
and booming tourism.
Despite the positive outlook and
current construction activity,
the domestic steel demand is
approximately 860 thousand tonnes;
a slight reduction on the prior year
and a 12-15% reduction from 980
tonnes during the last construction
peak in 2004/5. Consequently,
we expect the industry to remain
intensely competitive.
Construction continues to underpin
much of the volume, and while
the transfer of activity from
Christchurch to Auckland remains
evident, albeit it somewhat ‘lumpy’,
other parts of the country are
experiencing good activity.
The international dairy auction
price has improved over the past
several months which has prompted
Fonterra to increase their pay-out
forecast to $6.55/kg of milk solid
for the current year.
We are encouraged by several
announcements from the industry
to recommence investments into
processing plant, which hopefully
signals the commencement of further
investment in the broader rural sector,
in addition to viticulture which has
remained strong.
Pleasingly the manufacturing sector’s
resilience continues despite the
elevated dollar. As a result, we expect
the second half will be stronger than
the first half, reflecting the pricing
opportunity. The changes made
during the first half in relation to
costs, the project commitments to
S&T Plastics and CFDL’s performance
through the next six months will also
deliver improved earnings.
Sir John Anderson
Chairman
Dave Taylor
Chief Executive Officer
16 February 2017

HALF YEAR REPORT 2017
The accompanying notes form part of these financial statements.
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Consolidated Interim Statement Of Profit Or Loss
And Other Comprehensive Income
FOR THE HALF YEAR ENDED 31 DECEMBER 2016
Unaudited
December 2016
Unaudited
December 2015
Notes$000$000
Sales revenue 254,470 265,737
Other operating income 1,444 163
Cost of sales(189,730)(205,403)
Selling expenses(20,963)(19,888)
Administration expenses(15,487)(12,040)
Other operating expenses(13,675)(12,814)
Operating earnings before financing costs16,059 15,755
Gain on property sale - 6,267
Interest income 48 49
Interest expense(1,521)(2,026)
Profit before tax14,586 20,045
Tax expense (4,002)(4,166)
Profit for the year attributable to owners of the parent10,584 15,879
Items that may be reclassified to profit or loss
Other comprehensive income/(loss) - hedging reserve713 (1,266)
Total comprehensive income11,297 14,613
Basic earnings per share (cents)11.8 17.8
Diluted earnings per share (cents)11.8 17.8

The accompanying notes form part of these financial statements.
FINANCIAL STATEMENTS
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Consolidated Interim Statement Of Changes In Equity
FOR THE HALF YEAR ENDED 31 DECEMBER 2016
Share
capital
Retained
earnings
Hedging
reserve
Treasury
shares
Share-
based
payments
Total
equity
$000$000$000$000$000 $000
Balance at 1 July 201677,756 105,657 (431)(3,500)763 180,245
Comprehensive income
Profit after tax - 10,584 - - - 10,584
Items that may be reclassified to
profit or loss
Other comprehensive income
– hedging reserve (net of tax)
- - 713 - - 713
Total comprehensive income - 10,584 713 - - 11,297
Transactions with owners
Dividends paid - (12,088) - - - (12,088)
Proceeds from partly paid shares 48 - - - - 48
Granted/vested during the period – net - - - - (78)(78)
Purchase of own shares
– net of transaction costs
- - - (175) - (175)
Unaudited balance at 31 December 2016
77,804 104,153 282 (3,675)685 179,249
Balance at 1 July 201571,717 96,858 863 (3,100)671 167,009
Comprehensive income
Profit after tax - 15,879 - - - 15,879
Items that may be reclassified to
profit or loss
Other comprehensive loss
– hedging reserve (net of tax)
- - (1,266) - - (1,266)
Total comprehensive income - 15,879 (1,266) - - 14,613
Transactions with owners
Dividends paid - (8,987) - - - (8,987)
Proceeds from partly paid shares 44 - - - - 44
Granted/vested during the period – net - - - - (238)(238)
Purchase of own shares
– net of transactions costs
- - - (407) - (407)
Issue of ordinary shares related
to business combination
6,000 - - - - 6,000
Unaudited balance at 31 December 201577,761 103,750 (403)(3,507)433 178,034

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HALF YEAR REPORT 2017
The accompanying notes form part of these financial statements.
Consolidated Interim Balance Sheet
AS AT 31 DECEMBER 2016
UnauditedAudited
December 2016June 2016
Notes
$000$000
Current assets
Cash and cash equivalents 3,025 2,287
Trade and other receivables 80,671 89,842
Inventories 134,944 129,377
Income tax receivable 195 -
Derivative financial instruments 481 33
219,316 221,539
Non-current assets
Property, plant and equipment 62,496 61,557
Intangibles 62,310 47,344
124,806 108,901
Total assets344,122 330,440
Current liabilities
Trade and other payables 42,334 45,133
Borrowings4 53,200 -
Provisions 1,923 3,104
Derivative financial instruments 145 854
Income tax payable - 808
97,602 49,899
Non-current liabilities
Trade and other payables 1,242 1,229
Borrowings4 64,606 97,900
Deferred tax 291 160
Provisions long term 1,132 1,007
67,271 100,296
Equity
Share capital77,804 77,756
Retained earnings104,153 105,657
Other reserves(2,708)(3,168)
179,249 180,245
Total equity and liabilities344,122 330,440
These consolidated interim financial statements and accompanying notes were authorised by the
Board on 16 February 2017.
For the Board



Sir John Anderson, Chairman Dave Taylor, Chief Executive Officer

The accompanying notes form part of these financial statements.
FINANCIAL STATEMENTS
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Consolidated Interim Statement Of Cash Flows
FOR THE HALF YEAR ENDED 31 DECEMBER 2016
UnauditedUnaudited
December 2016December 2015
$000$000
Cash flows from operating activities
Customers receipts
268,566 270,541
Interest receipts
48 49
Payments to suppliers and employees
(248,174)(253,550)
Income tax payments
(4,874)(5,646)
Interest payments
(1,521)(2,026)
Net cash inflow from operating activities
14,045 9,368
Cash flows from investing activities
Property, plant and equipment disposals
- 8,252
Payment for new business purchase (net of cash acquired)
(12,911)(33,966)
Property, plant and equipment and intangible asset purchases
(8,086)(3,978)
Net cash outflow from investing activities
(20,997)(29,692)
Cash flows from financing activities
Share capital
48 44
Treasury shares – net of transaction costs
(176)(407)
Borrowings
19,906 45,360
Dividends paid
(12,088)(8,987)
Net cash inflow from financing activities
7,690 36,010
Net increase in cash and cash equivalents
738 15,686
Cash and cash equivalents at beginning of the period
2,287 4,090
Cash and cash equivalents at end of the period
3,025 19,776
Represented by:
Cash and cash equivalents
3,025 19,776

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HALF YEAR REPORT 2017
Notes To The Consolidated Interim Financial Statements
FOR THE HALF YEAR ENDED 31 DECEMBER 2016
1. Basis of preparation and accounting policies
Steel & Tube Holdings Limited (the Company) is registered under the Companies Act 1993 and is a
FMC Reporting Entity under the Financial Markets Conduct Act 2013. The Company is a limited liability
company incorporated and domiciled in New Zealand. The Group comprises Steel & Tube Holdings
Limited and its subsidiaries. The Group’s principal activities relate to the distribution, processing and
fabrication of steel, plastic and allied products.
The registered office of the Company is at Level 7, 25 Victoria Street, Petone, Lower Hutt, New Zealand.
These interim financial statements have been reviewed, not audited, and were approved for issue on
16 February 2017.
Basis of preparation
The Group is a for-profit entity. Its unaudited condensed consolidated interim financial statements have
been prepared in accordance with, and comply with, New Zealand Generally Accepted Accounting
Practice (NZ GAAP). They comply with New Zealand’s Equivalent to International Financial Reporting
Standard NZ IAS 34: Interim Financial Reporting and International Accounting Standard IAS 34: Interim
Financial Reporting.
These financial statements do not include all the information required for full financial statements,
and consequently should be read in conjunction with the full financial statements of the Group for the
year ended 30 June 2016, which have been prepared in accordance with New Zealand Equivalents to
International Financial Reporting Standards and with International Financial Reporting Standards.
These interim financial statements have been prepared using the same accounting policies and methods
of computation as the financial statements for the year ended 30 June 2016.
These financial statements are presented in New Zealand dollars and rounded to the nearest thousand.

FINANCIAL STATEMENTS
11
Disclosures
2. Business combinations
On 31 October 2016 the Group through its subsidiary Composite Floor Decks Limited (CFDL) acquired all of
the assets and business undertakings of Metal Decking Limited (formerly known as Composite Floor Decks
Limited) for an initial consideration of $13.8 million in cash and a further $3 million contingent on certain
conditions being met over the next two years. CFDL is a market leader in the supply and installation of
composite metal floor decking in New Zealand.
The contingent consideration assesment as well as the determination of the fair value of the assets and
liabilities acquired is in the process of being finalised and will be completed before the financial year end.
$000
Consideration paid at 31 October 2016
Consideration paid (cash)13,812
Less: Cash on acquisition(901)
Net cash consideration12,911
Contingent consideration (provisional amount)3,000
Total net fair value of consideration paid15,911
Recognised fair value amounts of identifiable assets
acquired and liabilities assumed at acquisition date
Trade and other receivables3,753
Other current assets493
Property, plant and equipment708
Trade and other payables(2,492)
Total identifiable net tangible assets2,462
Intangible assets 13,449
Total15,911
Acquisition related costs of $0.4 million have been charged to administration expenses for the period
ended 31 December 2016.
During the period ended 31 December 2016 CFDL contributed revenue of $3.7 million, and after tax profit of
$0.9 million. Had CFDL been consolidated from 1 July 2016 the Group Statement of Profit or Loss and Other
Comprehensive Income would show revenue of $261.8 million and after tax profit of $12.2 million.

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HALF YEAR REPORT 2017
3. Related parties
The Company has related party relationships with its subsidiaries and with key management personnel.
There have been no material changes in the nature or amount of related party transactions for the Group
since 30 June 2016.
4. Borrowings
The Group has committed bank borrowing facilities, of which $78.5 million has an expiry date of October
2017, and $78.5 million has an expiry date of June 2018. There has been no other material changes in the
management of risk or in any risk management policies in the current period. On 20 January 2017 the
Group signed a variation to the bank borrowing facilities which has amended the expiry date on
$78.5 million from October 2017 to October 2019.
5. Operating segments
There have been no material changes in the nature of operating segments since 30 June 2016.
The Group has one reportable segment.
6. Litigation
In March 2016, the Commerce Commission announced an investigation into grade 500E ductile steel
mesh. In December 2016 the Commerce Commission announced that it had completed its investigation
in relation to several companies, and that it intended to prosecute three companies under the Fair Trading
Act, including Steel & Tube. The expected costs in relation to this prosecution have been accrued for, as
have any proceeds that will be recovered under the Group’s insurance policies.
The Commission’s intended prosecution of Steel & Tube relates to the inadvertent use of a testing
laboratory’s logo on test certificates, and the application of testing methodologies.
7. Subsequent events
On 16 February 2017 the Board declared a fully-imputed dividend of 9.0 cents per share ($8.15 million) and a
supplementary dividend to non-resident shareholders of 1.58 cents per share. The dividends will be paid to
shareholders on 31 March 2017.

FINANCIAL STATEMENTS
13
TO THE SHAREHOLDERS OF STEEL & TUBE HOLDINGS LIMITED
PricewaterhouseCoopers
113-119 The Terrace
PO Box 243
Wellington 6140
New Zealand
www.pwc.com/nz
Telephone +64 4 462 7000
Facsimile +64 4 462 7001
Independent Review Report
FOR THE HALF YEAR ENDED 31 DECEMBER 2016
Report on the Interim Financial Statements
We have reviewed the accompanying financial statements of Steel & Tube Holdings Limited (“the Company”)
and the entities it controlled, together the Group, on pages 6 to 12, which comprise the condensed balance
sheet as at 31 December 2016, and the condensed statement of profit or loss and other comprehensive
income, the condensed statement of changes in equity and the condensed statement of cash flows for the six
month period ended on that date, and selected explanatory notes.
Directors’ Responsibility for the Financial Statements
The Directors are responsible on behalf of the Company for the preparation and presentation of these financial
statements in accordance with New Zealand Equivalent to International Accounting Standard 34 Interim
Financial Reporting (NZ IAS 34) and International Accounting Standard 34 Interim Financial Reporting (IAS 34)
and for such internal controls as the Directors determine are necessary to enable the preparation of financial
statements that are free from material misstatement, whether due to fraud or error.
Our Responsibility
Our responsibility is to express a conclusion on the accompanying financial statements based on our review.
We conducted our review in accordance with the New Zealand Standard on Review Engagements 2410 Review
of Financial Statements Performed by the Independent Auditor of the Entity (NZ SRE 2410). NZ SRE 2410
requires us to conclude whether anything has come to our attention that causes us to believe that the financial
statements, taken as a whole, are not prepared in all material respects, in accordance with NZ IAS 34 and IAS 34.
As the auditors of the Company, NZ SRE 2410 requires that we comply with the ethical requirements relevant
to the audit of the annual financial statements.
A review of financial statements in accordance with NZ SRE 2410 is a limited assurance engagement. The
auditors perform procedures, primarily consisting of making enquiries, primarily of persons responsible
for financial and accounting matters, and applying analytical and other review procedures. The procedures
performed in a review are substantially less than those performed in an audit conducted in accordance with
International Standards on Auditing (New Zealand). Accordingly we do not express an audit opinion on these
financial statements.

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HALF YEAR REPORT 2017
We are independent of the Group. Our firm carries out other services for the Group in the areas of tax advice
and other assurance services. The provision of these other services has not impaired our independence.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that these financial
statements of the Group are not prepared, in all material respects, in accordance with NZ IAS 34 and IAS 34.
Restriction on Distribution or Use
This report is made solely to the Company’s shareholders, as a body. Our review work has been undertaken so
that we might state to the Company’s shareholders those matters which we are required to state to them in
our review report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the shareholders, as a body, for our review procedures, for this report, or
for the conclusion we have formed.
For and on behalf of:
Chartered Accountants
Wellington
16 February 2017

FINANCIAL STATEMENTS
15

Registered Office
Level 7, 25 Victoria Street, Petone, Lower Hutt, New Zealand
PO Box 30543, Lower Hutt 5040, New Zealand
Ph: +64 4 570 5000 Fx: +64 4 569 2453
Email: info@steelandtube.co.nz
Website: www.steelandtube.co.nz
Share Registry
Computershare Investor
Services Limited
Private Bag 92119, Auckland 1142, New Zealand
Ph: +64 9 488 8777 Fx: +64 9 488 8787
Email: enquiry@computershare.co.nz
Website: www.computershare.com
Auditors
PricewaterhouseCoopers