As construction activities start picking up in the second half of 2010, steel manufacturer OneSteel Ltd (ASX: OST) said on Tuesday that demand growth for the product could be expected for the rest of the year as the company reported that it gained 12 percent full-year profit for 2009/10.

The Sydney-based company said that it achieved a net profit of $258 million for the past 12 months that ended in June this year, coming from the $230 million it netted in the previous corresponding period, though revenue slid by 14 percent to $6.21 billion.

Also, OneSteel said that it posted an underlying profit of $241 million for the same year, which is 12 percent better from the figures last year and fully in line with previous guidance set by the company.

From the results, OneSteel said that it would distribute an unfranked final dividend of six cents per share, leading to a full year distribution of 11 cents as compared to the 10 cents issued last year.

Company chief executive Geoff Plummer noted that the results were largely influenced by the recovering markets still shell-shocked by the effects of the worldwide financial downturn yet "the result was acceptable given the challenging external environment."

Mr Plummer admitted that the company waded through series of difficulties as the economy recovers, pointing to months of May and June as the most challenging period, when efforts were seemingly amounted to nothing.

He added that the global crisis imprinted much pressure on the industry, rendering "the recovery through most of the year has been off a very low base, and activity levels in many of our steel markets are still weak and well below pre-GFC levels."

On the other hand, OneSteel's iron ore business reflected the market's quick recovery as total sales in the division soared by 31 percent to $782 million as solid demands coming from China led to rising volumes and better average prices as against last year's levels.

Also, the company's recycling segment bannered spikes in sales volumes, which effectively cushioned the negative effects of the strong Australian dollar though the declining average sales in US dollars resulted to rather firm earnings in the division.