InfraBuild chief Francisco Irazusta defends company financials after Whyalla collapse
In first public comments, Francisco Irazusta said InfraBuild – which is owed $100m by One Steel – will continue to operate ‘long into the future’.
InfraBuild chief Francisco Irazusta on Friday stressed the financial strength of his company in the wake of the South Australian government’s decision to call in the administrators on chairman Sanjeev Gupta’s Whyalla steel mill.
Infrabuild is ring fenced from Whyalla but is a secured creditor owed at least $100m, including prepayments from delivery of steel billets it buys from the mill.
Mr Gupta has made clear he did not support the government’s stance and is seeking legal advice.
In his first public comments since the move, Mr Irazusta said in a statement: “It is business as usual at InfraBuild. We are a separate company from One Steel Manufacturing Pty Ltd (which owns the Whyalla steelworks), with an independent board, governance structure and its own financing structure which distinguishes it from the wider group.
“InfraBuild is a strong business with a resilient supply chain and its liquidity remains robust with strategic measures in place for it to manage any challenging local or global steel market conditions,” he added.
Mr Irazusta said the company was “well placed to continue manufacturing and supplying high quality Australian steel long into the future”, adding that “InfraBuild is Australia’s only steel maker operating electric arc furnaces and the largest integrated steel maker from scrap metal recycling through to steel long products manufacturing and downstream distribution and processing.”
InfraBuild was part of Arrium, which went into administration in 2016 with the Whyalla steel mill and Iron Knob magnetite iron ore assets.
The South Australian government has talked about the construction of an electric arc furnace mill at Whyalla but steel industry sources say it doesn’t make a lot of sense because the site is situated a long way from scrap steel supplies and from its customers.
Gupta has promised to build an electric arc furnace as part of a green steel program.
There are three other electric arc furnaces in various stages of construction in Australia, including, a WA government backed mill in Kwinana, Grant Johnston’s planned mill near Brisbane airport and another by a consortium of scrap merchants.
Mr Irazusta on Friday stressed his green credentials, noting “InfraBuild has invested more than $330m in capex over the last three financial years, driving our low emission steel making capacity including our new SENSE 600 lower embodied carbon reinforcing steel.”
He said: “around 80 per cent of InfraBuild’s sales are for residential, commercial and key infrastructure construction projects, with the remainder of its sales coming from rural and residential sectors.”
Most in the steel industry think the Whyalla administration will be a net benefit for InfraBuild as it will clear it of suggestions its profits are keeping the mill going.
The company reported a loss of $18.6m last financial and a $239.6m profit in the 2023 financial year.
In the first half last financial year it reported a profit of $40m on revenue of $2.5bn.
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