BlueScope Steel has dramatically reduced the size of its losses after closing a blast furnace, exiting export markets and slashing hundreds of jobs.
The steelmaker posted a net loss of $12 million for the half-year to December 31 2012, down from a $530 million loss in the equivalent period a year earlier.
The company also made an underlying profit - which excludes one-off costs and write-downs - of $10 million, which BlueScope says exceeded its previous forecasts.
BlueScope says the turnaround reflects lower costs associated with cutting back production, and discontinuing loss-making exports.
It says its Australian coated and industrial products division delivered a promising $79 million in pre-tax earnings despite difficult trading conditions.
The company says those difficulties included dumped imports, but it is expecting Federal Government reforms announced in December will partially stem the illegal dumping of cheap imports.
BlueScope's managing director Paul O'Malley, says the company is also about to benefit from a joint venture with Nippon Steel and Sumitomo Metal Corporation, which was agreed to last year, has now obtained most regulatory approvals required, and should be completed by the end of March.
"Net proceeds of approximately $US540 million will deliver a very strong balance sheet and enhance financial flexibility to invest in growth opportunities," he noted in the report.
Mr O'Malley says it is a good result, given the extremely difficult trading conditions the company's faced.
"It's probably the first time in four years that on every metric we've been able to say that we've improved the business," he said.
"Clearly we've still got a lot of work to do, but the trend is positive and satisfying and has been achieved because of the hard work of our employees across the business."
Investors gave the profit report a positive reception, with BlueScope shares up 7.4 per cent to $4.05 by 10:53am (AEDT).