Steel & Tube Shareholder Newsletter December 2023

SHAREHOLDER
NEWSLETTER
December 2023

ECONOMIC HEADWINDS
PUTTING PRESSURE ON
DEMAND
Global unrest, high inflation and interest
rates, cost of living pressures and political
uncertainty have all combined to dampen
domestic demand. While immigration-
driven population growth and international
demand for our primary sector are
underpinning some areas of the economy,
other sectors are facing more volatility.
Residential construction consents are down
more than 20% on the same time last year,
with commercial construction consents
only slightly higher than prior year
1
. The
manufacturing sector has contracted further
2
,
however large scale infrastructure projects
remain in progress.
POSITIVE MEDIUM TO
LONG TERM MACRO-
TRENDS
Longer term macro-trends are more
positive. As cost of borrowing and political
stability start to improve, we expect to
see more incentive for investment in
construction projects and a more favourable
manufacturing environment. Net immigration
growth will drive demand for housing, and the
infrastructure pipeline remains strong.
We have significant medium to long term
opportunities in areas of climate resilience,
seismic strengthening, rebuild activity
and essential water services, supported by
government budgeted infrastructure spend of
$71b over the next five years.
Susan Paterson ChairMark Malpass Chief Executive Officer
COMPANY UPDATE
1
Statistics NZ October 2023
2
Treasury Economic Update 20 October 2023
DEAR SHAREHOLDER
KIA ORA, TĒNĀ KOUTOU
As we arrive at the end of 2023, we can look back at another 12 months where
Steel & Tube has delivered solid results in a difficult economic environment.
While volumes have been under pressure from economic headwinds, staying the
course on strategy and our focus on ‘controlling the controllables’ has allowed
us to continue generating strong margins, grow market share in key categories,
offset inflation pressures with cost efficiencies and strengthen our balance sheet.
In difficult economic times, maintaining a strong balance sheet and a lean cost
structure is critical. As at end of November 2023, we had net cash of $17.1m
($6.5m at 30 June 2023), and a further reduction in inventory down to $135.50m
($139.2m at 30 June 2023).

DELIVERING ON
STRATEGY WHILE
CONTROLLING THE
CONTROLLABLES
Our strength is underpinned by our relentless focus
on customer service and providing quality steel
products and solutions. We have a lean operating
structure and have built a sustainable and resilient
business platform. The competitive advantage
provided by our national network, broad product
offering and multi-sector exposures provides
significant operating leverage to the anticipated
upswing in future demand.
The strategic investments we have made over the
last two years into high value products and services
and acquisitions continue to perform strongly:
• We have continued to expand the range of
aluminium products we sell, since launching
this line in early 2023
• Building on the plate processing growth
in Auckland, new equipment will be
commissioned in Christchurch in the new
year, ahead of schedule, allowing us to better
service the South Island market
• We continue to leverage our national footprint
to expand our acquired Kiwi Pipe and Fittings
business from its historical customer base of
Auckland and Waikato
COMPANY UPDATE
3
Normalised EBIT has been adjusted to exclude non-trading adjustments of ~$1m primarily relating to Software as a Service and Project Strong costs.
STEEL MARKET
PROCUREMENT
U P DATE
Steel & Tube prepares a regular
Procurement Update, providing
insights into the global steel market
and what this means for Steel &
Tube. The December 2023 Update
‘Expansion or Contraction’ suggests
a more stable outlook for the 2024
year but with continued risks from
economic and global headwinds
and expected price volatility.
The Steel & Tube Procurement
Update can be read here.
• Our Project Strong investment in semi-
automated palletised warehousing will increase
our capacity for high value, high demand
products
• Upgraded mesh straightening equipment
has been installed in Auckland and we have
also invested in new purlins machinery with
automated stacking systems.
1H24 EARNINGS GUIDANCE
We previously advised that we anticipated activity
in the 2023 calendar year to be subdued, however
expected to maintain 1H24 normalised EBIT in line
with 2H23. We are pleased to report that, despite
the challenging environment, we remain on track
to deliver 1H24 normalised EBIT in the range of $10
to $11m (2H23: $10.6m).
This has been achieved through customer focus,
strong pricing disciplines and good progress with
our $5m cost management programme which has
allowed us to offset inflation with efficiencies. Gross
margin dollars/tonne continues to improve vs the
prior comparative period.
Our leverage and tight cost controls should result
in strong earnings growth when volumes return to
prior year levels as the economy improves.
You can read the full announcement on our
website here.
Our commitment to our people, our
communities and the environment continues.
Steel & Tube was recently recognised in the
2023 Forsyth Barr Carbon ESG Report with
an overall CESG ranking of 17 out of the 58
companies assessed, and as one of the top 10
Social performers.
We’re pleased to share with you some of our
recent initiatives in this newsletter, as well
as introduce you to Steel & Tube’s new Chief
Digital Officer, Raffaella Del Prete.
Steel & Tube has an experienced and
engaged team who continue to focus on
the performance of the core business, while
taking advantage of growth opportunities
in steel processing, aluminium and our new
acquisitions. As a result of their efforts, the
company continues to perform strongly in
the more challenging trading environment.
As always, we welcome feedback from our
shareholders. Thank you for your continued
support.
Ngā mihi and Happy Holidays
Susan Paterson Mark Malpass
Chair Chief Executive Officer

CELEBRATING
70 YEARS
2023 was the year of Steel & Tube’s 70th anniversary, a significant milestone
that marks seven decades of unwavering commitment to providing
our customers with quality steel products and solutions. From humble
beginnings, our company has adapted and evolved, emerging stronger and
more resilient than ever. In a world where less than half of businesses make
it past the first ten years, our longevity and strong standing is testament
to our enduring spirit, our ability to move with the times, the dedication of
our team and the loyalty of our customers. The 70th anniversary is not just
a reflection of our past achievements but also a springboard for the exciting
future that lies ahead.
Our team has celebrated this milestone over the year, with activities ranging
from special occasion branding on cars and in workplaces, through to sharing
stories on long serving employees and their contributions to our legacy, and
the creation of a mural at our company office, depicting our history. Our
annual Excellence Awards also pay tribute to this significant event.
We are pleased to be gifting all permanent team
members with 70 shares each in Steel & Tube
as part of our 70th anniversary. This recognises
the vital contribution that our people make to
the success and longevity of the company. We
already have a highly engaged workforce and this
is another way we can engage with and reward
our team members for their efforts. This gift of
shares will have a negligible dilution on existing
shareholders while creating strong loyalty and
ownership for all our staff. We look forward to
having them as owners in our business.
GIFT OF SHARES TO TEAM MEMBERS

Our Values
TO MAKE LIFE EASIER FOR
OUR CUSTOMERS
Our Purpose
WE HAVE RESPECT
WHAKAUTE
• We value the skills the whole
team bring to the table – we’re
stronger together
• We’re inclusive, seek diversity of
thought and accept differences
• We honour the legacy of our
brand and strive to strengthen
it for future teams
WE ARE BRAVE
MĀIA
• We fight the good fight and
work hard to do what is right
• We stand out from the crowd
and support each other to
push the boundaries of what
is possible
• We walk the talk and take
responsibility for delivering
value to our customers
WE CARE
MANAAKI
• We look after our customers,
our communities, our
environment and each other
• We put safety and wellbeing
at the heart of our business
• We cheer our people on,
celebrate great work and
recognise progress
POWERFUL NEW VALUES
UNDERPINNING OUR FUTURE
As part of Steel & Tube’s 70th anniversary, we have refreshed our
company values and purpose, with input from our people across
the organisation. As well as general feedback, several important
groups of employees provided additional contributions – our
longest serving team members, a group of future leaders, our Māori
cadetship team and the Executive team.
The outcome is a refreshed purpose and values which underpin
Steel & Tube’s future success for the decades ahead.

Our Strategic Goals
STRENGTHEN
THE CORE
GROW HIGH VALUE
PRODUCTS AND
SERVICES

FROM STEEL TO POWER
We celebrated Steel & Tube’s role in a massive
infrastructure project, as the first turbine was
switched on at Merdian Energy’s Harapaki
Wind Farm development in November 2023.
Over the coming months, the 41 wind turbines
will be installed and energised.
Steel & Tube worked on the project for
14 months, supplying and installing more
than 2,800 tonnes of reinforcing steel. This
has been used to build the high strength
bases needed to meet the demands on the
foundations when operating wind turbines of
this size, as well as pile cages which are used
to support and distribute the weight load and
protect against seismic movement.
The project was not without its challenges,
with major weather events such as Cyclone
Gabrielle closing State Highway 5 and
severing access to the wind farm. While the
winter months brought snow, high winds
and extreme cold, the summer months also
delivered a lot more rainfall than expected.
The Steel & Tube team embraced the
challenging conditions, with multiple crews
working on various bases simultaneously, and
delivering an enhanced installation option
that assisted in the acceleration of the build
programme by several months.
“OUR EXPERIENCE
WITH STEEL & TUBE
WAS COLLABORATIVE
AND POSITIVE. THE
COMPLEXITY OF
THE FOUNDATIONS
CONSTRUCTION WITHIN
A HARSH ENVIRONMENT
WAS CHALLENGING,
AND DETAILED
PLANNING AND GOOD
COMMUNICATION WAS
KEY TO THE SUCCESSFUL
OUTCOME ACHIEVED.”
Contractor, Spartan Construction, commented
FROM THE
GROUND UP

HOMER TUNNEL
The Homer Tunnel is a crucial conduit
along SH94, connecting Te Anau to the
breathtaking Milford Sound Piopiotahi.
A $29 million project is being undertaken by
Downer for Waka Kotahi NZTA to improve
the safety and resilience of the Homer
Tunnel.
Work has officially begun to replace the
decades-old avalanche and rockfall shelter
at the eastern tunnel entrance, with a state-
of-the-art replacement. Delivering better
avalanche and rockfall protection on the Te
Anau side of Homer Tunnel, the new shelter
is designed to blend in with its unique and
breathtaking alpine surroundings. Around
150 precast concrete modules have been
prepared off-site, each carefully designed
for transport and efficient assembly at the
tunnel.
Steel & Tube has supplied c.400 tons of
reinforcing steel to ensure the structural
integrity and durability of these precast
modules. Adding to the complexity of the
project, is the need to bend large diameter
reinforcing to a particular shape. Steel & Tube
is working closely with McIntosh Precast
which is producing the concrete modules and
who provides 3D drawings for Steel & Tube to
work with.

SELO is a new urban village in West Auckland
– a master-planned townhouse development,
developed by Aedifice Property Group,
offering multi-unit housing, communal
amenities and shared spaces. The site has
been transformed into a people-oriented
micro-neighbourhood and incorporates a
mix of terraced townhouse styles. Working
for contractor, Chancellor Construction, Steel
& Tube provided the roofing for most of the
development.
Said Chancellor Construction: “For SELO, we
used Plumbdek® because it can be used on
3-degree roofs, it is modern and also very
cost-efficient.”
“Steel & Tube was very responsive, with
specification and sales support. We planned
and worked well together. There were some
unexpected storylines, like the Auckland
floods not long ago, but Steel & Tube assisted
in finding solutions without impacting our
supply chain.”
Read more on our website here.
BUILDING A VILLAGE
THE COMMISSIONING OF NEW
MESH STRAIGHTENING EQUIPMENT
IN AUCKLAND IS PART OF STEEL
& TUBE’S CAPITAL INVESTMENT
PROGRAMME IN ITS REINFORCING
BUSINESS. THE MACHINERY
REMOVES THE CURVE FROM
PRE-ROLLED DUCTILE WIRE AND
CUTS IT TO LENGTH. THIS IS THEN
USED TO MAKE ALL VARIATIONS
OF MESH. THE EQUIPMENT
IS MORE EFFICIENT, FASTER,
WITH GREATER CAPACITY AND
BETTER TECHNOLOGY THAN THE
PREVIOUS EQUIPMENT WHICH IT
HAS REPLACED.
SEE IT IN ACTION

OUR PEOPLE
Steel & Tube has a diverse workforce which is representative of the
communities in which we operate. Te Wiki o te Reo Māori (Māori
Language Week) provided the perfect opportunity to celebrate
both personal achievement and cultural diversity at Steel & Tube. At
the heart of this celebration is the Hāpai Tūhono – TPK Cadetship
Programme, an amazing initiative aimed at nurturing the growth
and development of our Māori staff at Steel & Tube. This programme
not only promotes career advancement but also champions Māori
culture. The cadetship is a collaboration between Te Puni Kōkiri, Hāpai
Tūhono and Steel & Tube.
INTRODUCING OUR NEW
CHIEF DIGITAL OFFICER
Raffaella Del Prete
Steel & Tube is pleased to welcome Raffaella
Del Prete as the company’s new Chief Digital
Officer. Technology is a key enabler for our
business, with data and insights helping us run
our business more effectively, our ecommerce
platform supporting our customers, and our
digital platform enabling efficient management
and operation of our business. We are already
using Artificial Intelligence in some areas of
the business and continue to assess further
opportunities.
Raffaella is a highly experienced senior digital
technology professional with a wealth of
experience leading and developing digital
strategy through to delivery of large-scale
digital transformation. She has over 20 years’
experience, with global businesses such as
Accenture, Nokia, Tesco, BP, T-Mobile, AIA and
Vodafone, in New Zealand, the UK and France.
Raffaella is Italian, having moved to New
Zealand for the outdoor lifestyle. She joined the
Steel & Tube team in early December 2023.
Whakapau kaha
(Structured Mentoring):
Each cadet is paired with a mentor who
not only provides valuable insights and
guidance but also serves as a strong support
system.
Whakapau mahi
(Tailored Training and Development):
Customised training and development plans
are designed to cater to the unique needs
and aspirations of each cadet, ensuring that
their growth is meaningful and aligned with
their goals.
Whakapau huarahi
(Relevant Work and Life Skills):
Beyond skill development, the programme
also focuses on imparting essential life
skills that empower cadets personally and
professionally.
CELEBRATING SUCCESS AND CULTURAL RICHNESS
THE PROGRAMME IS BUILT ON THREE FOUNDATIONAL PILLARS:
RECENT GRADUATES AND NEW CADETS DEMONSTRATE DEDICATION, RESILIENCE
AND A COMMITMENT TO PERSONAL AND PROFESSIONAL GROWTH, ALL WHILE
PRESERVING AND CELEBRATING THEIR CULTURAL HERITAGE.

SUPPORTING PEST
ERADICATION IN LEWIS
PASS
Every year in the South Island’s Lewis Pass,
volunteers for charity Doubtless Conservation
set out to trap as many stoats and possum
as possible, in their aim to create a large
inland predator-free ‘island’. Their efforts
in the Doubtful and Nina Valleys help to
protect Great Spotted kiwi (raroa) and blue
duck (whio). This work reinforces what was
started by Hurunui College in 2008, which has
seen the introduction of kiwi and successful
breeding of whio in the valley.
However, at times their hard work is being
thwarted by New Zealand’s cheekiest (and
also endangered) bird, the Kea. Known as
one of the most intelligent birds in the world,
these clever mountain parrots have decided
that setting off the traps is great amusement
and can also be a source of food. The loud
bang the traps make when tipped over and
set off, together with the added bonus of the
chance of scoring an egg, make traps a target
for kea.
In an effort to ‘kea-proof’ the traps, as well as
stop wind and water turning the traps over,
the charity uses pieces of steel rebar as an
anchor so the trap can’t be moved.
The charity has a strong connection with the
Department of Conservation and are guided
by them to ensure they are undertaking the
best trapping practice.
Steel & Tube is delighted to support the
efforts of Doubtless Conservation by donating
custom cut steel rebar.
Find out more
OUR COMMUNITIES

SUSTAINABLE
TRANSPORT INITIATIVE
Steel & Tube is collaborating with a number
of other local businesses in East Tamaki and
Highbrook to advocate for better short
and longer-term transport solutions for
our business community. Options include
increased public transport options; shared
shuttles; car-sharing initiatives; cycling and
other transport modes. The overarching goal
is to make it easier to get around without a
car, which in turn helps to reduce emissions.
Making it easier and more cost effective to
travel to work also helps attract employees to
the area.
One of the deterrents is the lack of public
transport options. Alternative transport
modes such as walking and cycling are
confined by limited access via major arterial
roads. In partnership with Business East
Tamaki, Goodman Property Trust and several
other East Tamaki businesses, Steel & Tube is
proposing a shared transport shuttle service
to take employees from existing transport
hubs to the workplace. This would help
to reduce congestion, supplement public
transport services, provide better value for
money and deliver environmental benefits.
Work is underway to establish a pilot of
the programme, with success providing a
template for other business precincts to
follow.
Read more here
ENVIRONMENTAL
CERTIFICATIONS
Steel & Tube has recently renewed its
Sustainable Steel Council Gold Certification
as well as Eco Choice Aotearoa (New
Zealand’s only government-backed eco label)
certification. The company is also a member
of the Sustainable Business Council and is
certified against ISO 14001 (Environment
Management Systems) standard.
Our goal is clear:
to maximise steel’s
contribution to a
sustainable and low
emissions society, whilst
continuing to grow our
business and deliver
value to our shareholders.
Environmental
sustainability is a critical
part of our decision
making and is embedded
in our strategy.
Licence #: 5717145
SUSTAINABLE
BUSINESS

STRONGER
TOGETHER
THANK YOU
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CONTACT US:
Steel & Tube Holdings Ltd
7 Bruce Roderick Drive, East Tamaki, Auckland 2013, New Zealand
PO Box 58880, Botany, Auckland 2163, New Zealand
Tel: +64 4 570 5000 Email: investor.relations@steelandtube.co.nz
www.steelandtube.co.nz