BlueScope held its annual general meeting late this week, where it announced an upgrading of its expected earnings for the first half of the 2016-17 financial year to at least $510 million.

This is a slight improvement on its prediction in August, where it suggested the earnings could be just under $510 million.

The sharemarket responded favourably to the news, with Bluescope shares jumping $1 in a day to $8.40.

In his speech to shareholders BlueScope’s new chairman John Bevan said the company’s recent turnaround was “very encouraging”.

But he added there would be no free rides – “every facility has to pay its way”.

Mr Bevan said the rest of the company had much to learn from the cost reduction approach taken at Port Kembla in the second half of 2015, which saw job loses and pay freezes but also kept the steelworks gates open.

“Across all our businesses, we need to embed the lessons of survival from the last 12 months at Port Kembla steelworks where, thanks to the co-operation and commitments made by employees, unions, the community in the Illawarra and the NSW government, steelmaking will continue for now,” Mr Bevan said.

"It is an ongoing challenge – to consistently deliver the returns that earn the right to future re-investment.”

While stating that “the short-term survival mode has largely passed” Mr Bevan said BlueScope was well aware that there is a global oversupply of steel.

He said China alone was producing half of that and exported 20 times as much as BlueScope’s three steelmaking sites combined.

“Our strategy to compete against these enormous odds is to be cost-competitive and to differentiate our premium branded products,” Mr Bevan said.

BlueScope CEO Paul O’Malley said countries around the world were taking issue with China’s overproduction of steel.

“In the past the world’s economies accepted that China exporting deflation – through a supply of ever cheaper manufactured goods – was okay,” he said.

“But China is now effectively exporting unemployment and politicians and communities all around the world are struggling with this issue.”

Mr O’Malley said the steelmaker had bucked a world trend by making a profit.

“It is pleasing to report that BlueScope has been able to deliver strong profits at a time when the global steel industry has seen the worst prolonged macro-economic circumstances of the past two decades,” he said.