Q1 2023 Algoma Steel Group Inc Earnings Call
Good morning, ladies and gentlemen, and thank you for standing by.
Welcome to Algoma steel fiscal first quarter 2023 conference call. At this time all participants are in a listen only mode. A question and answer session will follow the formal presentation.
Should you require operator assistance during the conference. Please press star zero to signal an operator. Please note. This conference is being recorded.
Now I'll turn the conference over to your host Michael Muraca, Treasurer, and Investor Relations Officer for Algoma steel. Thank you you may begin.
Good morning, everyone and welcome to Algoma Steel group Inc's first quarter fiscal 2023 earnings Conference call, leading today's call are Michael Garcia, Our Chief Executive Officer, and Raj at Marwar, Our Chief Financial Officer.
As a reminder, this call is being recorded and will be made available for replay later today in the investors section of Algoma steals corporate website at Www Dot Algoma Dot com I would like to remind you that comments made on today's call may contain forward looking statements within the meaning of applicable securities laws, which involve assumptions and inherent risks.
And uncertainties actual results may differ materially from statements made today.
In addition, our financial statements are prepared in accordance with I F or S, which differs from U S. GAAP and our discussion today includes references to certain non <unk> financial measures.
Last evening, we posted an earnings presentation to accompany today's prepared remarks, the slides for today's call can be found in the investors section of our corporate website.
With that in mind I would ask everyone on today's call to read the legal disclaimers on slide one of the accompanying earnings presentation and to also refer to the risks and assumptions outlined in Algoma Steel's financial statements and management's discussion and analysis for the full year ended March 31 2022.
Please note that our financial statements are prepared using the U S dollar as our functional currency and the Canadian dollar as our presentation currency.
Our fiscal year runs from April 1st of March 31st at our financial statements have been prepared for the three months ended June 30th 2022.
Please note all amounts referred to on today's call are in Canadian dollars unless otherwise noted.
Following our prepared remarks, we will conduct a question and answer session.
I will now turn the call over to our Chief Executive Officer, Michael Garcia Mike.
Thank you Mike Good morning, and thank you for joining Algoma Steel's earnings call for our first fiscal quarter ended June 30th 2022.
I'll start my comments as we always do by addressing what truly matters most to us the safety of our employees.
At Algoma, we believe in safety without compromise and our continued focus has resulted in substantial improvement over the last decade, and our lost time injury frequency rate.
I commend our entire team for their collective success and continued diligence as we relentlessly pursue our goal of achieving zero workplace injuries.
Now before we get into the results for the quarter I want to update you on where we are with our union negotiations given the announcements over the past week.
To start all of our plants are fully operational at this time.
There are two local chapters of the United Steelworkers that represent our unionized employees.
The most recent multi year labor agreements with those two unions were set to expire on July 31.
We believe we have made fair and attractive offers to both unions.
Offers which asks for no concessions and provide our employees with a highly competitive compensation package that compares favorably to our north American peers.
Last week members of United Steelworkers, local 2724, which represents our technical professional and frontline supervisory employees accepted our offer and ratified a new labor agreement with Algoma.
Negotiations with the USW local 2251, which represents hourly workers continue.
Last Friday, we announced that we had submitted our best.
And final offer that unions negotiation team.
Who declined to submit the proposal to its membership for a vote.
Therefore in anticipation of the strike. This past weekend, we began taking steps to take our facilities offline safely ahead of the original deadline.
On Saturday Night, we announced the company and the Union negotiating team.
Had reached an agreement to continue discussions without any workforce action for an additional 15 days.
Allowing us to continue operating our facilities normally in the interim.
This extension demonstrates the willingness and desire on both sides to reach a fair and equitable agreement for operations of the facilities today and throughout the transition to electric arc steelmaking.
At this time, we have no further update on the progress of those talks.
Due to the sensitivity of these discussions we will be limited in what we can share regarding these active negotiations during our Q&A session on this call.
Now turning to our results on today's call I'll cover my observations from my first 60 days as CEO as well as key events and milestones during the quarter and subsequent to its end.
I will then turn over the call to Roger for a deeper dive into the numbers before closing with thoughts on the current state of steel markets and our capital return policy.
Let's say that my first two months on the job had been busy would be a major understatement.
As we have advanced a number of strategic initiatives during that time.
One of my first priorities was to roll up my sleeves and get out on the site.
Meeting our exceptional team Familiarizing myself with the specifics of our operations processes and approach and seeing up close and personal the impressive facilities, we operate in Sault Saint Mary.
Having spent time with many of our team members I come away, even more excited about our operations and our future.
We have a dedicated group of operators focused on executing the pathway to all goldman's future as a leading north American producer of Green steel.
Relentless execution by the team drove strong results, we achieved in our first fiscal quarter.
Those results, which was shot will discuss in more detail momentarily included shipments of 538000 tons revenue of $934 million adjusted EBITDA of $358 million.
And cash generated by operating activities of $277 million.
During the quarter, we continued to advance construction of our transformative electric arc furnace project.
Which I am pleased to report remains on budget and on time for our planned 2024 startup.
We completed the first phase of our two phase plate mill modernization project in June 2022.
With expected quality being achieved.
The second phase initially expected to be completed in November .
It has been extended to June 2023 to support our customers impacted by a longer than anticipated startup due to automation issues during the first phase.
Further by extending the timeline, we are better positioned to apply learnings from the first phase to the second phase outage to ensure seamless execution.
We launched the next phase of our capital allocation program.
With a 400 million U S substantial issuer bid.
We distributed over $150 million in our employee profit sharing program a corporate record that reflects our outstanding results in fiscal 2022 and.
And prior to launching our SIB, we repurchased one 6 million shares through our normal course issuer bid or NCI b at an average price of U S $9 11 per share.
Like I said a busy quarter.
Just last week, we successfully completed the oversubscribed SIB process, which resulted in the repurchase of approximately 41 million shares or approximately 27, 9% of our issued and outstanding shares at the time of the program announcement at.
At a price of $9.75 U S.
I'll Goldman now has $105 million 403930 issued and outstanding common shares.
It's a testament to the execution by our team during these times of challenging market conditions. Like these that we are able to operate our existing portfolio of assets normally without being operationally impacted by the construction of our transformational E F project.
All while being able to return meaningful capital to shareholders.
Now I will pass the call over to resort to go over the strong financial results for the quarter before closing with some thoughts on the markets and our capital allocation program Rajat.
Thanks, Mike.
Good morning, and thank you all for joining the call.
Our first fiscal quarter results continued to demonstrate the impressive cash generating potential of Oklahoma.
I'll remind you again that all numbers are expressed in Canadian dollars unless otherwise noted.
Our quarterly results were highlighted by net income of $301 4 million.
All dollar 149 cents per share.
Adjusted EBITDA of $357 7 million.
This exceeded our guidance of 335 to 355 million and reflects an adjusted EBITDA margin of 38, 3% and.
The only long term debt on our balance sheet is in the form of government loans linked to our capital projects.
We finished the quarter with $1 $1 billion of unrestricted cash and remains undrawn on our revolving credit facility. So even after funding a successful U S 400 million SIB last week, our balance sheet remains strong.
Diving into the key drivers of outperformance, we shipped 538000 net tons in the quarter.
One 2% sequentially.
And down 12% as compared to the prior year quarter.
As he previously disclosed.
One month's scheduled outage at the plate mill during the quarter during which we completed phase one of a planned upgrade.
Impacting year over year comparisons.
Or the automation challenges Mike described earlier will have an impact on shipments in the second fiscal quarter.
The increase versus prior year.
Reflect.
A positive impact of our contract order book as higher log prices flow through our revenue.
This resulted in steel revenue of $77 million in the quarter.
Sequentially, but up 21% versus the same quarter of last year.
On the cost side. They go much cost of goods sold average 920 per ton in the quarter down 3% on a sequential basis, but up 32% with a variety of beat it.
The main drivers of this increase versus the prior year period include commodity price increases for selected raw material inputs.
Increased employee based profit sharing as a result of our historic performance.
And higher SG&A costs related to being a public company.
From a cash flow perspective, I'll go much change in noncash working capital generated $12 2 million in cash flow from operations in the quarter.
This was higher than expected and southern tide and us having slightly more cash on the balance sheet at the end of the quarter than previously anticipated.
The main drivers of the increase in cash flow from operations include the release of approximately $73 million of accounts receivable during the quarter due to falling prices and lower shipments.
And an increase in taxes payable, which included withholding taxes payable in connection to the prior year perfect shedding.
These factors were offset by a significant increase in inventory is related to normal restocking for typical seasonal low inventory levels at March 31st as well as a significant increase in work in progress inventory of slabs were produced and stopped during the play through modernization outage.
We finished the quarter with $1 1 billion of cash and equally on the balance sheet.
Credit card, which positioned us well to complete our sip, while retaining ample liquidity to address future capital and operating needs.
As an update to ear project spending as I mentioned on the previous call approximately 8% of the spending occurred in the prior fiscal year.
Approximately 60% will be spent in fiscal 2023, and the balance of the spending occurring after fiscal 2023.
Up to the end of June quarter, we have spent approximately $103 million on the ear project.
Looking at the project in totality.
Proximately, 60% has been contracted with fixed price commitments, but the balance 40 per cent to be contracted.
Still maintains a significant portion of a traditional contingency to support the remaining project spending that does not yet committed.
Beyond the <unk> project you are excited to successfully complete a sip last week.
The last leg.
Our capital allocation program.
In addition to the Sip our continued strong financial results position us to be active in returning capital to shareholders on multiple fronts.
Including our normal quarterly dividend.
And through a N C a D, which revealed resume effective today as it was temporarily suspended during the Sip as required under the applicable laws and stock exchange rules.
Onto the fortress balance sheet and strong cash generation profile.
We are well positioned to continue evaluating all options around capital allocation.
I would now like to turn the call back to Mike for some market update and closing tonnage Mike.
He was shot.
Looking at the state of the North American steel market today pricing has fallen from recent highs reached in April .
That said buyer sentiment appears to reflect a growing consensus that pricing is normalizing near current levels.
Other indicators. This is evidenced by today's forward curve for hot rolled coil, which is showing higher prices over the next few months.
Pricing near today's levels is still historically high relative to any point prior to 2021.
And still well above mid cycle pricing.
In the near term, we expect pricing to stay near current levels and we remain optimistic about the intermediate and long term supported by the fundamentals we continue to see in the market and in our order book.
Those fundamentals include a diverse customer base.
A consistent strong contract mix and a wide range of product offerings.
Concerns and headwinds related to inflation.
Currency global conflict and supply chains persist.
Yeah, we have a number of reasons to be optimistic that near and intermediate term pricing will remain at attractive levels.
<unk> remains consistent with our expectations from the automotive construction oil and gas and other steel intensive industries.
And controls on imports remain in place.
We have positioned the company to benefit from these favorable market conditions operationally and are excited to be able to do so even as we execute the construction of the EIF project.
Before we open it up to questions a few words on our capital allocation policy.
Our primary focus remains on delivering prudent financial discipline and operational excellence to ensure our ability to execute our EIF project.
Sharing in the next phase of our company that provides the foundation for long term value creation for our stakeholders.
We are proud that even as we transition to a low cost Green steel company.
The steps, we have taken to strengthen the balance sheet and to position our operations to benefit.
From the strong market pricing like we have seen over the last two years have also afforded us the opportunity to return capital to shareholders.
As I mentioned previously our.
Our biggest step to date was the successful 400 million U S. SIB.
Which augmented our U S five cent per share regular quarterly dividend and our normal course issuer bid program.
As I said on my first call in June My view is consistent with the boards.
And that we expect to be a significant generator of free cash over the long term.
Putting us in the enviable position of being able to continuously evaluate our capital allocation policy with the board.
All while continuing to live within our means.
And not spend money, we don't have or expect to generate.
The fiscal first quarter was a strong start to what promises to be a very exciting year at algoma.
One in which we will continue our relentless focus on safe reliable.
Operations at our existing facilities to enjoy the benefits of strong markets, even as we advance the dual yeah, yeah projects.
Thank you very much for your continued interest in Algoma steel.
We look forward to what the future holds at this point, we would be happy to take your questions.
Operator, please give the instructions for the Q&A session.
Okay.
Thank you.
At this time, we will be conducting a question and answer session. If you would like to ask a question. Please press star one on your telephone keypad.
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Our first question is from Dave Gagliano with BMO capital.
Great. Thanks for taking my questions.
I missed some of the commentary there in the beginning and I apologize.
Can you can you talk through again, what is happening operational excuse me operationally and what are the delays that you mentioned.
Day, we referenced the startup of our of our plate mill in.
Subsequent to the end of the first quarter and that startup has been more.
More protracted than we originally planned.
And that's the that's the delays we were referencing.
Okay I'll I'll.
I'll I'll take a look at the transfer when it comes out and then just to follow up on that I guess in a certain regard.
To help us fine tune things in the near term can you talk about obviously, it's a whatever it is August 4th and lead times I suspect suggest that you've got visibility into September now so are we.
We're getting there on the quarter and I was wondering if you could just speak to.
Operating assumptions operating metrics.
Volumes mix.
<unk> costs on a quarter over quarter basis, and if you want perhaps even pricing as well I know there was some pricing commentary around holding near current levels, but.
What's it look like for the third quarter or for the third calendar quarter.
Hey, David This is Roger.
So so that would be from guidance perspective, we probably will resolve or comments for Florida for the for the for this quarter.
However.
There are there are a few comments that are worth, noting which Mike mentioned in his prepared remarks.
<unk> is taking longer so so we will see a less volume getting produced and shipped in this quarter.
On the plate side. So so we so we were seeing a month long outage, which probably has taken us additional six to eight weeks to ramp up on what it takes six to eight weeks to ramp up so you'll see that impact coming in in the September quarter other than that.
I don't think so we'd be in a position to guide you.
He further so the volume will be lower just because of the placement.
And David.
This is Mike as far as pricing.
I mean, you can see that our current pricing.
It has I think the public number that we look at share was.
Hot rolled coil index price of $8 32, and still a substantial premium between hot rolled coil and plate and then you know theres commentary around the slope of the movement of the price and.
And other than the forward curve of the price that bill.
Builds a little bit of a view that you know, maybe we may be reaching a plateau or a an area of stability, but again, you know that that remains to be seen so pricing is still well above mid cycle.
And.
That's basically where we are and what we're building our plans around.
Okay. I mean, that's effectively why I was asking those questions because the price has been all over the place and lags change in lead times change and the business model is highly sensitive to relatively small changes we saw that a couple of quarters ago.
In an effort to try and avoid those you know what I would call probably immaterial from a longer term perspective, but nevertheless important from a near term perspective variations and how it impacts results I was hoping we could get a little more color.
On the on the operating metrics.
Let me ask this question.
When when when prices fall mix shifts between contract and spot is there of.
A way to frame how much of that business versus contract business, we should be modeling in for the current quarter.
Uh huh.
I don't think we've seen a significant shift between contract and spot Ah.
I think the biggest you know one of the biggest differences we've seen is that.
We have a little bit we have a shorter visibility into the future in terms of the size of our of our order book.
It's because lead times are shorter we we closeout the order book.
Let's say for the month of for the current month later in the month than we typically would it still closing out at expected levels. So the volume is there it does.
We do book it, but it's a it's a shorter view forward in terms of looking at an order book than we would typically expect but this debt.
The significant shift or material shift between spot and contract I can't say that we've we've seen that.
Okay. Thanks, I'll turn it over to someone else. Thanks.
Okay.
Our next.
Our next question is from David Ocampo with <unk> Securities.
Thanks, Good morning, everyone.
I just wanted a follow up Dave.
David's questions as it relates to at least volume side here, if I take a look at the sheet. The sheet shipments. It's now trending below where you were Q1 of last year and even Q2.
From last year.
Is that decline primarily on the spot business or or is that on your contracted business.
That decline is is mostly on the sport business and the reason for the decline as well as the the plate mill outage. It it's actually a combination mill as you know it produces strip as well as plate.
And when the when the mill is out it affects both our sheet and plate. So we have seen that impact.
In the Q1, Oh as the numbers are and we will see that little bit of impact coming in in the in the September quarter as well because the patent strip is taking longer to ramp up.
Okay and for your contracted business I think it's close to 65% of your overall book.
How much flexibility or are you willing to give your customers. If we do see some weakness here or is it.
Plus or minus 10% or is it more take or pay.
Well, it's a there is some flexibility it's normally normally in the range of plus minus 10%.
And and that's it so that is that it's pretty good compliance on the on the contracts otherwise.
Okay. That's good and then Mike you touched a little bit about the futures curve. It's it's currently in contango right now versus the more normal steep backwardation I'm just curious if that changes how you guys consider hedging I know you have a small hedge book right now I think it's 60 to 66000 tons.
But would you would you get a little bit more aggressive on that just given the dynamics that we're seeing in the marketplace.
Thanks for the question David.
We would certainly examine it and if it reaches a point, where we believe it would be prudent to.
Take a different possession with position with that with that hedging book.
Certainly something we can do I don't think it's yet at a point that wood wood.
Caused us to do that but it's certainly something we keep an eye on it and we know that that is an option that is available to us or a course of action that might make sense in the right scenario.
Yeah.
Okay. That's it for me I'll hand, and one of her thanks guys.
Thank you.
Our next question is from my mom shops with Beacon Securities.
Hey, guys. Thanks for taking my question I'm just wondering if there was any color you can give us on or the cost trends, whether it's short term or for the second half of the calendar year.
Color on the cost trends, whether it's an EBITDA per ton of Cogs.
Appreciate it.
Sure so on the on the cost side.
Well I think it's something that I've I've always mentioned, but Oh I will repeat that we normally see on.
On the iron ore side.
Five to six months lag so as you're seeing prices coming down on the iron ore index or HR receive even see that flowing into our cost with a lag of five to six months.
So so that definitely will help us as we go along along the year.
Cordless fixed for the full year. So we don't see major change so and so the big change will come from iron ore. There are other commodities that are coming down as up as the price of these commodities come down whether its alloys refractory, which definitely will impact us.
Within a quarter or.
So within a quarter and within six months, we should see the trajectory of our offer.
Enable cost coming down, mostly because of iron ore and some commodities which are fluctuating.
Coal remains same.
Throughout the year.
Yeah.
That's great color. Thank you Roger I'll jump back in the queue.
Okay.
Our next question is from Ian Gillies with Stifel.
Good morning, everyone.
Funding in Romania.
With respect to coking coal and if I recall correctly those contracts typically get renewed and in the fall at some point when you look at price trends today versus kind of where you are contracted or would you expect that that becomes a tailwind for margins as we head into the next year of usage or is it still.
Too early to say.
I think it's a.
It's little early to say, but it's moving in the right direction.
People are you know.
We'll come out with their let's say people the manufacturers will come out with the harvest Skus.
Later in this quarter or early next.
And there will be there will be settlements happening definitely could come gold companies are indicating that their cost of production has gone up because of inflation.
However, we've seen you know some of the listed companies reporting very similar close to as they reported last year or so sub sub $100.
So yes. This trend has trended scored a from from cost perspective, and we are hopeful that settlements can happen at them at an attractive price.
Okay.
And then the other cost piece I wanted to hit on could you maybe talk a little bit about the impact that these elevated natural gas prices are likely to have on the business in the back half of the year and if theres any way to maybe mitigate some of the price increases that are occurring for that specific input.
So so.
<unk> from pricing perspective, and cost perspective.
You know.
We consume roughly six M M btu per ton.
All four of finished steel production. So so you can do the math to see what.
Natural gas is as a percentage of our cost.
We do have some flexibility in our.
Our operations, primarily in the blast furnace, where we can substitute Oh, the heat which is coke.
Cooking cooking coal produced cope with natural gas. So what we do is we keep flexing between gas and coal depending upon the price of each and the calorific value off the heat.
To try to optimize our cost. So that's that's what we do as far as you know long term litigation is concerned we are working through our hedging.
<unk> strategies on specifically on natural gas to see how we can oh, we can best.
Use that tool.
To reduce volatility in pricing, but currently the price itself is too high and when you look at the futures side.
The $78 price drops to $4 as soon as you get into April which is.
Which is not reflective of any dynamics are any fundamentals.
It's more sentimental. So so we are watching natural gas price, we are watching our cost and trying to optimize based on our operational capabilities and we'll be looking at tools like hedging to mitigate over longer term.
Okay.
That's helpful. And then last one for me I mean, I acknowledged that the order book sounds like its pretty full for August .
But with respect to lead times and things of that nature have you seen any discernible difference on that front that gives you a pause pause for concern or does that is that all a pretty steady to where you were side call. It a month or two ago.
Ian This is Mike.
Okay.
It's not dramatically different than a month or two ago I think the sentiment remains that.
There's there's an expectation or maybe or an overhang or worry in in the markets of of a recession or a.
A decrease in economic overall economic activity.
Bob.
And so that's <unk>.
Resulted in customers, who have large inventories and service their customers out of these inventories to be very deliberate and mindful about.
The inventory positions that they maintain and as a result of the ordering that they do with us and others to maintain those inventory levels.
So I think that's pretty much.
<unk> to be the state.
So while all that is happening I think there was maybe some period that was a little quieter because of.
The adjustment taking place, but if you think about the adjustment kind of already in place then.
The ordering the volume that they are actually pulling continues to be at our expectations because they're fun to my assumption is because their fundamental business has not yet reached.
Our reduced activity that that they may be worried or concerned about about at this time if that if that's helpful.
No. That's very helpful. I appreciate that context, it's very useful so thanks very much I'll turn the call back over.
Thanks Ian.
Our next question is from Antelope pretty hard with eight capital.
Good morning, Richard just with respect to the budget for the year. Yeah. I think you said in your remarks that 60% of the budget had been committed.
I think the last time, we spoke about the contingency we said it was something in the neighborhood of about $80 million has not changed materially since the last commentary.
No. It has not changed materially that is.
Some contingency being used but it's.
Essentially still available.
Okay, and then just coming back to the commentary on the Q2 volume should we expect Q2 volumes to be down on a year over year basis.
Oh, yes.
Okay. Thank you.
As a reminder to ask a question. Please press star one.
Our next question is from Alexander Jackson with RBC capital markets.
Yeah, Hey, guys. Thanks for taking my question just another one on the a F budget I was curious on the cadence of the capital spending in fiscal 2023, I know you guys are spending 60% there.
Just trying to get a sense of when we might see some sort of key milestones cross in terms of Derisking.
So.
From from spending perspective.
You know we will.
We will see.
A large part of the spending coming in the in the coming two quarters up till December .
And less so in in the March quarter.
From milestones perspective.
Have a.
We have you know.
As we said we have given all the contracts are up to now including building and equipment.
The other milestone will be the balanced contracts that we're doing detailed engineering on which we expect to get the get completed and given some time later later this year. So most.
Most of the work you know, let's say a large part of that 40% remaining should be done in the in the coming quarters one.
Bye Bye marchand, so that at least we have derisk, a large part of our of our spending like anything else.
Just for a little more color.
If you were to drive by or go spend time at the site. The the foundations and pilings work is has been continuing and we expect to start erecting.
Start erecting buildings or.
The things above the level of the ground I guess you could say.
In the fall October timeframe late September the another big piece of work, we need to do the advantage of this project is that we.
We have very little existing infrastructure or operations that were taking place in the footprint of the new Eas complex. What we did have was a small relatively small little maintenance repair shop.
That we have relocated.
And probably the biggest thing we had was the the internal railroad tracks that we used to convey our our our hot iron from the blast furnace two the the steelmaking.
POS we had to re route that block that track that section of track it's probably.
Maybe a quarter mile at the most a little less than that move it off to the side of where the building is getting is going to be constructed.
So that we could have smooth operations of the of that.
Part of the steelmaking process and have a clear footprint to continue with the project that that work has been done.
And so from that perspective, that's kind of what the project is looking at at this moment looking like at this moment sorry.
Thanks, Thanks for that color guys Thats all from me.
We have one follow up question from Dave Gagliano with BMO. Please proceed.
Hi, just a couple of quick clarifications.
Do you expect your sheet volumes to be down quarter over quarter. My first question and then the second question. The Capex cadence of the Capex. The next two quarters to we expect that to be over $100 million on a quarterly basis. Each of the next two quarters this quarter and the next one before declined a little bit in March.
Yes, so on the on the sheet side, we might expect some volume to be down.
<unk> over quarter.
And from Capex spending perspective.
Uh huh.
We should see a thing.
In the same light as Youre seeing.
You know.
Let's say bigger portion coming in.
In this quarter and next quarter and then.
Then dropping down.
In the March quarter.
Okay. Okay. That's helpful. Thank you.
No problem David.
Ladies and gentlemen, we're out of time and have reached the end of the question and answer session I would like to turn the call back to management for closing remarks.
Thank you I'd like to thank all of you again for your participation in our first quarter fiscal 2023 earnings conference call and for your continued interest in Algoma steel. We look forward to updating you on our results and progress when we report our fiscal second quarter results later this fall.
This concludes today's conference Algoma steel. Thanks, you for your participation you may disconnect your lines at this time.
Okay.
[music].