Corus is considering opening steelmaking operations in Russia and China as well as buying foreign coal and iron ore mines as its financial fortunes improve dramatically.

The results, which included a 19% increase in turnover to £5.3bn, were helped by high steel prices and a major cost-cutting programme at the steelmaker, which was emerging from years of losses.

The group is now moving into a new era of expansion and has already expressed an interest in the privatisation of Erdemir, Turkey's largest steel producer.

Corus is in talks with potential local partners there and Mr Varin said it was looking at other opportunities in high-growth, low-cost countries such as Russia, China and central Europe.

But he warned: "We must not put the cart before the horse - we must restore (internal) success first."

The former British Steel is also exploring the potential of vertical integration by buying up raw material assets, which it needs to produce steel and which have been soaring in value and pushing up costs. The group had previously confirmed it had been looking at an iron ore mine in Norway.

"We are currently at a disadvantage to integrated producers so we are interested in exploring some form of vertical integration," said Mr Varin.

He said he expected steel prices to bounce back in the final quarter of the group's financial year. They dipped 30% in the second quarter due to restocking and a pause in Chinese demand, prompting Corus to cut output by first 5% and then 10% for the third quarter.

Mr Varin praised the "unprecedented" action by both European and American producers for reducing their output to cope with what should be a temporary dip in demand.