September 08, 2008

Stelco swings to CAD 38 million profit in Q3

Stelco Inc reported that it had net income of CAD 38 million in the third quarter up from a loss of CAD 25 million during the same period of 2006. The gains were due in part to CAD 5 million in savings from workforce reductions and foreign exchange increases of CAD 36 million.

EBITDA* increased to CAD 67 million for the third quarter an improvement of CAD 14 million over the second quarter of 2007.

Its average revenue per ton was CAD 606 million down from last year's CAD 719 million.

Stelco said that its financial improvement in profits was largely driven by a significant improvement in the cost structure resulting from the strategic and operational restructuring initiatives over the past 18 months plus lower input costs, offset by lower selling prices.

US Steel Corp agreed to buy Stelco for CAD 38.50 in cash per common share or USD 1.1 billion in August 2007. The acquisition waits regulatory and shareholder approval and is expected to close by the end of the month.