Steel and mining group Arrium has fallen further into the red as the high Australian dollar and weak construction markets cause a massive writedown on its assets.

Arrium made a net loss of $447.2 million in the six months to December 31, down from a $70.7 million loss in the previous corresponding period.

The result includes a $474 million impairment on its assets, which was announced to the market earlier in February.

Excluding the impairment, Arrium’s underlying profit in the six months to December was $51 million, down from $77 million in the previous corresponding period.

Lower iron ore prices in Arrium’s mining business was the main factor in the lower underlying profit, the company said on Tuesday.

No specific guidance was given for the full year, but Arrium said it expected the majority of its full year net profit to be made in the second half as iron ore prices improve.

Lower iron ore prices had a $75 million to $85 million impact on net profit in the mining business, compared to the previous corresponding period, chief executive Geoff Plummer said.

“While further volatility is possible, we anticipate iron ore prices for the balance of this financial year to continue to be above the average level for the first half,” the company said in a statement.

Arrium’s mining consumable business, which supplies equipment to resource companies, posted earnings growth in the six months to December, as it grew in Australia as well as in north and south America.

The company’s steel business continued to be challenged by the high Australian dollar, low steel prices and weak construction activity, Arrium said.

“For the OneSteel steel businesses, we expect continuation of the difficult external environment, including a high Australian dollar and generally weak domestic demand,” the company said.

An unfranked interim dividend of two cents per share will be paid to shareholders.