Algoma Steel Reports Strong First Quarter Results
Sault Ste Marie based Canadian steel maker Algoma Steel Inc has reported strong first quarter results for the fiscal quarter ended June 30, 2021, setting the stage for its parent company, Algoma Steel Group Inc become a public company later in 2021. In the first quarter of fiscal 2022, the Company earned a net income of CAD 214 million, up from CAD 114 million in the prior quarter and a CAD 43 million loss in Q1 fiscal 2021. The Company's strong financial performance is primarily attributable to an improvement in shipment volume, strong steel demand and improved selling prices.
Shipments for the first quarter increased by 47% to 610,000 tons, compared to 416,000 tons in Q1 fiscal 2021, culminating in steel revenue of CAD 765 million, up 124% from CAD 423 million in the first quarter of fiscal 2021 and from CAD 633 million in the prior year quarter.
The strong demand and realized pricing, as well as the Company's focus on cost containment, contributed to CAD 281 million of Adjusted EBITDA for the first quarter, up from CAD 167 million in the prior quarter and CAD 21 million in Q1 fiscal 2021.
Algoma Steel Inc Chief Executive Officer Mr Michael McQuade said "We believe that our ongoing focus on keeping our employees safe and developing a culture of continuous improvement, coupled with a steady stream of strategic investments in our operating facilities, improves our position across the steel cycle. The extended strength we see in the steel market positions us favorably for our pending return to public markets. In addition, last month's announcement of the Government of Canada's anticipated CAD 420 million in support for our proposed transition to electric arc furnace technology, together with up to USD 306 million of new equity capital that may be provided by our merger with Legato Merger Corp, is expected to make our sustainability transformation possible."