Algoma Steel Group Reports Fiscal Second Quarter 2025 Financial Results

Core Insights - Algoma Steel Group Inc. reported a consolidated revenue of CAD 600.3 million for the fiscal second quarter ended September 30, 2024, a decrease from CAD 732.6 million in the prior-year quarter, primarily due to lower steel shipments and realized prices [2][4] - The company experienced a consolidated loss from operations of CAD 83.6 million, compared to an income of CAD 36.8 million in the prior-year quarter, and a net loss of CAD 106.6 million compared to a net income of CAD 31.1 million in the prior-year quarter [2][6] - Adjusted EBITDA was CAD 3.5 million with an adjusted EBITDA margin of 0.6%, significantly down from CAD 81.0 million and 11.1% in the prior-year quarter [2][7] Financial Performance - Revenue from steel was CAD 539.0 million, down from CAD 665.8 million in the prior-year quarter, with revenue per ton of steel sold decreasing to CAD 1,153 from CAD 1,334 [4] - Shipments totaled 520,443 tons, a decrease of 5.2% from 548,998 tons in the prior-year quarter [7] - Cash flows generated from operations were CAD 25.5 million, down from CAD 57.2 million in the prior-year quarter [2] Operational Developments - The company is on track to begin commissioning activities for its Electric Arc Furnace (EAF) project by the end of calendar 2024, with steel production expected by the end of the first quarter of 2025 [3][8] - The cumulative investment in the EAF project reached approximately CAD 672.3 million, with contracted commitments totaling around CAD 870 million [8][9] - Algoma's EAF project is eligible for reimbursement under Ontario's Emissions Performance Program, which is expected to reduce the project's net cash costs [9][10] Strategic Changes - Algoma announced a change in its fiscal year end from March 31 to December 31, effective December 31, 2024, to better align its reporting calendar with industry peers [13] - The company declared a quarterly dividend of US$0.05 per share, payable on December 27, 2024 [12] Balance Sheet and Liquidity - As of September 30, 2024, Algoma had cash of CAD 452.0 million and unused availability under its Revolving Credit Facility of CAD 342.8 million [11] - Total assets amounted to CAD 3,095.9 million, with total liabilities of CAD 1,682.1 million, resulting in shareholders' equity of CAD 1,413.8 million [25]