Q1 2024 Stelco Holdings Inc Earnings Call

Good morning. Thank you for attending todays <unk> first quarter 2024 earnings Conference call. My name is for them and I will be your moderator for today's call.

Forum: Good morning. Thank you for attending today's Stelco First Quarter 2024 Earnings Conference Call. My name is Forum, and I will be your moderator for today's call. All lines will remain muted during the presentation portion of the call, with an opportunity for questions and answers at the end.

All lines will remain muted during the presentation portion of the call with an opportunity for questions and answers at the end.

I'd like to ask a question. Please press star one on your telephone keypad and it's now my pleasure to pass the conference over to our host Trevor Harris with Stelco. Mr. Harris. Please proceed.

Forum: If you would like to ask a question, please press star 1 on your telephone keypad. It is now my pleasure to pass the conference over to our host, Trevor Harris of Stelco. Mr. Harris, please proceed.

Trevor Harris: Good morning, everyone and welcome to <unk> quarterly earnings Conference call speaking on the call today to discuss our 2024 first quarter results will be Alan Kestenbaum, Our executive Chairman and Chief Executive Officer, and pulse shares our Chief Financial Officer.

Trevor Harris: Good morning, everyone, and welcome to Stelco's quarterly earnings conference call. Speaking on the call today to discuss our 2024 first quarter results will be Alan Kestenbaum, our Executive Chairman and Chief Executive Officer, and Paul Scherzer, our Chief Financial Officer.

Trevor Harris: Yesterday, after the market closed, we issued a press release overviewing Stelco's financial results for the first quarter of 2024. This press release, along with the company's financial statements and management's discussion and analysis, has been posted on CDAR Plus and on our investor relations website at investors.stelco.com. We've provided a link to the presentation referenced on today's call on our website. As a reminder, I would like to inform everyone that comments made on today's call may contain forward-looking statements that involve assumptions which have inherent risks and uncertainty. Actual results may differ materially from the statements made here today, so do not place undue reliance on them. Stelco Management disclaims any obligation to update forward-looking statements except as required by law.

Trevor Harris: Yesterday after the market close we issued a press release overview of <unk> financial results for the first quarter of 2024. This press release, along with the company's financial statements and management's discussion and analysis have been posted on SEDAR and on our Investor Relations website at investors Stelco Dot Com, we've provided a link to the presentation referenced in today's call on our website.

Speaker Change: Well I.

Trevor Harris: I would like to inform everyone that comments made on today's call may contain forward looking statements, which involve assumptions, which have inherent risks and uncertainties actual results may differ materially from the statements made here today, so do not place undue reliance upon them.

Trevor Harris: Management disclaims any obligation to update forward looking statements, except as required by law.

Trevor Harris: With that in mind, I would ask everyone on today's call to read the legal disclaimers on page 2 of the accompanying earnings presentation and also to refer to the risks and assumptions outlined in Stelco's public disclosure, in particular the first quarter of 2024, management's discussion and analysis sections relating to forward-looking information and risks and uncertainties, as well as our filings with securities commissions. The appendix of our presentation and the non-IFRS performance measures and review of non-IFRS measures sections of our MD&A provide definitions and reconciliations of the non-IFRS measures that we use.

Trevor Harris: With that in mind I would ask everyone on today's call to read the legal disclaimer on page two of the accompanying earnings presentation and also to refer to the risks and assumptions outlined in <unk> public disclosures in particular, the first quarter 2020 for management's discussion and analysis sections relating to forward looking information and risks and uncertainties as well as our.

Trevor Harris: Filings with Securities commissions in Canada the.

Trevor Harris: The appendix of our presentation and the non <unk> performance measures and review of non <unk> measures of our MD&A provide definitions and reconciliations of the non <unk> measures that we use today.

Trevor Harris: Please also note that all dollar figures referred to on today's call will be in Canadian dollars unless otherwise requested. Following today's prepared remarks, Alan and Paul will take questions. To maximize efficiency, we would ask that all participants who would like to ask a question please limit themselves to one question and one follow-up question before requeuing. With that, I would now like to turn the call over to Alan.

Trevor Harris: Please also note that all dollar figures referred to on today's call will be in Canadian dollars unless otherwise noted.

Trevor Harris: Following today's prepared remarks, Alan and Paul will be taking questions to maximize efficiency. We would ask that all participants who would like to ask a question. Please limit themselves to one question and one follow up question before re queuing with that I would now like to turn the call over to Alan Alan.

Alan Kestenbaum: Thank you Trevor and good morning, everyone.

Alan Kestenbaum: Thank you, Trevor, and good morning, everyone. In the latter part of 2023, we saw an improvement in the market with respect to both demand and pricing that represented an opportunity for our business to deliver stronger results in 2024. The first quarter was representative of the strength, the resilience, and versatility we have built in our business and the ability of our team to control costs and take full advantage of these favorable conditions by driving increased revenue straight through to the bottom line. In Q1, we generated $153 million of adjusted EBITDA, a 200% increase over the previous quarter.

Alan Kestenbaum: In the latter part of 2023, we saw an improvement in the market with respect to both demand and pricing that represented an opportunity for our business to deliver stronger results entering 2024.

Alan Kestenbaum: The first quarter was representative of the strength.

Alan Kestenbaum: And versatility, we have built in our business and the ability of our team to control cost and take full advantage of these favorable conditions.

Alan Kestenbaum: Driving increased revenue straight through to the bottom line.

Alan Kestenbaum: In Q1, we generated $153 million of adjusted EBITDA, a 200% increase over the previous quarter the.

Alan Kestenbaum: The resulting adjusted EBITDA margin of 21% was once again the highest amongst our North American reporting steelmaking peers, a position we have proudly held for 10 of the last 14 quarters. As a management team, we take great pride in this continued success. Our close alignment with shareholders has been at the core of our philosophy and led us to ensure that the deployment of our capital has always been in your, our fellow shareholders', best interest.

Alan Kestenbaum: The resulting adjusted EBITDA margin of 21% was once again, the highest amongst our north American reporting steelmaking peers, a position we have probably held for 10 of the last 14 quarters.

Alan Kestenbaum: As a management team we take great Pride in this continued success our close alignment with shareholders has been at the core of our philosophy and led us to ensure.

Alan Kestenbaum: The deployment of our capital has always been and your fellow shareholders best interests.

Alan Kestenbaum: As an example, last quarter, we took the step of increasing our ordinary quarterly dividend, and today we are again declaring an ordinary dividend to our valued shareholders of 50 cents per share, which annualizes to more than 5% based on the existing share price. In addition, during the quarter, we took the step of repurchasing shares under the previously announced normal course issuer bid. As a result of these continued efforts to deliver value, we have surpassed $2.1 billion in capital returns to our shareholders since 2017, or more than 10 times the amount we raised in our IPO. When looked at as a percentage of market capitalization, this level of return leaves behind the entire North American industry.

Alan Kestenbaum: As an example last quarter, we took the step of increasing our ordinary quarterly dividend and today, we are again declaring.

Alan Kestenbaum: An ordinary dividend to our valued shareholders of <unk> 50 per share, which annualized to more than 5%.

Alan Kestenbaum: Just on the existing share price.

Alan Kestenbaum: In addition, during the quarter, we took the step of repurchasing shares under the previously announced normal course issuer bid as a result of these continued efforts to deliver value. We have surpassed $2 1 billion in capital returned to our shareholders since 2017.

Alan Kestenbaum: For more than 10 times the amount we raised in our IPO.

Alan Kestenbaum: When looked at as a percentage of market capitalization. This level of return leads by far the entire North American industry.

Alan Kestenbaum: We are extremely proud of this track record and intend to keep the interests of our shareholders front and center as we determine the best way to deploy our capital in the future. These results did not come by chance.

Alan Kestenbaum: Extremely proud of this track record and intend to keep the interests of our shareholders.

Alan Kestenbaum: Front and center and we determined the best way to deploy our capital in the future.

Alan Kestenbaum: These results did not come by chance. They are a direct result of the tactical flexibility that we deploy in the day to day operation of our business, we have seen ebbs and flows in the market in recent years.

Alan Kestenbaum: They are a direct result of the tactical flexibility that we deploy in the day-to-day operation of our business. We have seen ebbs and flows in the market in recent years, both in terms of pricing and demand, and we have seen the influence of inflationary pressures on the cost of our raw material imports, but at every point in the market, our team and our business have been able to capitalize on the opportunities the market presents while controlling our cost of production and delivering high returns for the benefit of all of our stakeholders.

Alan Kestenbaum: Terms of pricing and demand and seeing the influence of inflationary pressures.

Alan Kestenbaum: On the cost of our raw material inputs, but.

Alan Kestenbaum: At every point in the market our team and our business have been able to capitalize on the opportunities that the market presented while controlling our cost of production and delivering high returns for the benefit of all of our stakeholders.

Alan Kestenbaum: We have already begun executing on our plan that we announced and initiated this year to expand our already impressive industry-leading market by increasing utilization of our downstream value-added capacity at the Hamilton Works in a way that enhances and diversifies the product mix and also increases our profit margins even further. We continue to explore all options to grow our business, whether through organic growth or creative M&A opportunities. We must remain patient and disciplined.

Alan Kestenbaum: We have already begun executing on our plan that we announced and initiated this year to expand our already impressive industry, leading margins by increasing utilization.

Alan Kestenbaum: Our downstream value added capacity at the Hamilton works.

Alan Kestenbaum: Way that enhances and Diversifies, our product mix and also increases our profit margins even further.

Alan Kestenbaum: While we continue to explore all options to grow our business, whether through organic growth or accretive M&A opportunities.

Alan Kestenbaum: We remain patient and disciplined.

Alan Kestenbaum: Our interest is in creating value for our shareholders. While we invest in all our assets, we will pursue those potential opportunities that have both attractive valuations and significant synergies. Thank you for your time this morning. I'll now ask Paul Scherzer to detail some of our financial results.

Alan Kestenbaum: This is in creating value for our shareholders.

Alan Kestenbaum: While we invest in all our assets, we will pursue those potential opportunities that have both attractive valuations and significant synergies. Thank you for your time. This morning, I'll now ask Paul to curtail some of our financial results.

Paul: Thanks, Alan and good morning, everyone.

Paul D. Scherzer: Thanks, Alan, and good morning everyone. The first quarter of 2024 was demonstrative of the true strength of our business and our ability to take advantage of opportunities in the market. While we did see an increase in revenue of 22% over the previous quarter that was largely driven by a comparable increase in our average selling price, our industry-leading low-cost structure and our relentless focus on cost controls saw us drive that revenue through to the bottom line. The 200% increase in adjusted EBITDA and the 187% increase in adjusted EBITDA per net ton are representative of our capability to convert these market opportunities into value for shareholders.

Paul: The first quarter of 2024 with demonstrative of the true strength of our business and our ability to take advantage of opportunities in the market. While we did see an increase in revenue of 22% over the previous quarter that was largely driven by a comparable increase in our average selling price our industry, leading low cost structure and a relentless focus on cost.

Paul: Controls SaaS drives that revenue through to the bottom line.

Paul: 200% increase to adjusted EBITDA, and 187% increase to adjusted EBITDA per net ton are representative of our capability to convert these market opportunities into value for shareholders. These results are in line with the guidance. We provided last quarter guidance that we were able to provide because of the confidence we have in our <unk>.

Paul D. Scherzer: These results are in line with the guidance we provided last quarter, guidance that we were able to provide because of the confidence we have in our tactical flexibility business model and in our management team's ability to seize market opportunities. These results, once again, have allowed us to deploy capital in a manner that benefits our shareholders through the payment of our recently increased ordinary dividend and the repurchase of approximately 162,000 shares under our normal course issuer bid.

Paul: Technical flexibility business model and in our management team's ability to seize upon market opportunities.

Paul: These results once again allowed us to deploy capital in a manner that benefits our shareholders through the payment of our recently increased ordinary dividend and the repurchase of approximately 162000 shares under our normal course issuer bid. We are also preserved optionality for the future deployment of capital by being conservative in our approach to.

Paul D. Scherzer: We have also preserved optionality for the future deployment of capital by being conservative in our approach to liquidity. For the second quarter in a row, we ended the period with $645 million in cash and with no borrowings on our revolving credit facility.

Paul: <unk>.

Paul: For the second quarter in a row, we ended the period with $645 million in cash and with no borrowings on our revolving credit facility as noted by Alan This flexibility will afford stelco has the opportunity to pursue both organic and accretive growth opportunities as they emerge without risk of compromising our commitment to our shareholders while.

Paul D. Scherzer: As noted by Alan, this flexibility will afford Stelco the opportunity to pursue both organic and accretive growth opportunities as they emerge without risk of compromising our commitment to our shareholders. While these metrics certainly paint a picture of our success during the first quarter of 2024, we also see optimism for the period ahead. In Q1, we realized an increase in shipping volume of 4% for a total of 636,000 net tons. For the second quarter, we anticipate shipping volumes to be in the range of 625,000 to 650,000 net tons.

Paul: These metrics certainly paint a picture of our success during the first quarter of 2024, we also see optimism for the period ahead in Q1, we realized an increase in shipping volume of 4% for a total of 636000 net tons for the second quarter, we anticipate shipping volumes to be in the range of 625000 to 650000 net tons.

Paul: We believe this relative stability in the market will Florida business the opportunity to leverage our relentless focus on cost and continue our strong record of generating cash from operations.

Paul D. Scherzer: We believe this relative stability in the market will afford our business the opportunity to leverage our relentless focus on cost and continue our strong record of generating cash from operations. This, of course, is central to our commitment to shareholders as we strive to generate value within our business and create opportunities to deploy capital in a responsible and strategic manner. As we move through the second quarter, we will continue to pursue measures that reduce our operating costs while maintaining a clean balance sheet.

Paul: This of course is central to our commitment to shareholders as we strive to generate value within our business and create opportunities to deploy capital in a responsible and strategic manner.

Paul: As we move through the second quarter, we will continue to pursue measures to reduce our operating costs, while maintaining a balance sheet. These principles have created a foundation of our business that has returned substantial benefits to all of our stakeholders and we will not deviate from our commitments.

Paul D. Scherzer: These principles have created a foundation for our business that has returned substantial benefits to all of our stakeholders, and we will not deviate from our commitment. Overall, the first quarter was a positive start to our year, and we're optimistic about our ability to continue building upon our success throughout 2020. Thank you for taking the time today to join us.

Paul: Overall, the first quarter was a positive start to our year and we are optimistic about our ability to continue building upon our success throughout 2024. Thank.

Speaker Change: Thank you for taking the time today to join our call.

Trevor Harris: Thank you, Alan and Paul. That concludes our prepared remarks for today. I would now like to turn the call back over to the operator for questions and answers. Operator.

Speaker Change: Thank you Alan and Paul that concludes our prepared remarks for today I would now like to turn the call back over to the operator for questions and answers operator.

Operator: My pleasure. If you would like to ask a question, please press star followed by one on your telephone keypad. If for any reason you would like to remove that question, please press star followed by two. Again, to ask a question, press star one. As a reminder, if you are using a speakerphone, please remember to pick up your handset before asking your question. In the interest of time, we ask that everyone limit themselves to one question and one follow-up question to ensure everyone has the opportunity to speak. Our first question today will come from the line of Katja Jancic with BMO Capital Markets. Katja, your line is now open.

Speaker Change: My pleasure if you would like to ask a question. Please press star followed by one on your telephone keypad.

Speaker Change: For any reason you would like to remove that question. Please press star followed by two again to ask a question press Star one.

Paul: <unk> if you are using a speaker phone. Please remember to you pick up your handset before asking your question in the interest of time, we ask that everyone limit to one question and one follow up question to ensure everyone has the opportunity to speak.

Speaker Change: Our first question today will come from the line of Katya Young Kim with BMO capital markets. Your line is now open.

Speaker Change: Hi, Thank you for taking my questions.

Katja Jancic: Hi, thank you for taking my question. Maybe starting on the margin, you delivered a solid first quarter margin, but now prices have moved lower. Can you talk a bit about how we should think about margin in the second quarter or near term?

Speaker Change: Maybe starting on the margin you delivered.

Speaker Change: Solid first quarter margin, but now prices have moved lower can you talk a bit about how we should think about margin in the second quarter or near term.

Alan Kestenbaum: Yeah, let me first correct something. Prices have actually not moved lower with respect to the second quarter because, as we've discussed on multiple occasions, the cycle since 2021 has gone up and down with the same type of buyer behavior. Buyer strikes, prices drop, buyers come rush in, prices shoot up. And that's what we experienced at the end of 2023.

Speaker Change: Yes, but let me first correct sampling our prices when that should not move lower with respect to the second quarter.

Speaker Change: Cause.

Speaker Change: As we've discussed on multiple multiple occasion.

Speaker Change: Since 2021 has gone up and down but at the same.

Speaker Change: Tightening sort of buyer behavior.

Speaker Change: Strike prices dropped buyers combustion prices shoot up and Thats, what we experienced at the end of 2023. When you saw that in November then prices started to shoot up in December.

Alan Kestenbaum: When you saw that in November, then prices started to shoot up in December. Because we booked in December, and we had already been booked halfway through the quarter, at that point when prices started to move, you really only started to see the benefit of some of those price increases occur late February and into March, and into April, and into May. So, you know, some recent markdowns in futures and CRU and other price indicators are really only starting to impact June, and so, therefore, we have the benefit already. We're predominantly sold out for the quarter.

Speaker Change: Because we booked in December and we had already been booked halfway through the quarter at that point when prices started to move you really only started to see the benefit of some of those price increases occur late February into March and into April and into May. So some recent markdowns in the in futures.

Speaker Change: Are you in other price indicators are really only just starting to impact.

Speaker Change: June.

Speaker Change: And so therefore, we have the benefit already were predominantly sold out for the quarter, we've got a little bit less so some of the recent softness.

Alan Kestenbaum: We've got a little bit left, so some of the recent softness may impact some of our competition, but should have less of an impact on us. We do see the same cycle happening again. History has been repeating itself consistently since 2021, and we do expect prices, which have, as you've correctly pointed out, been falling of late, A, not to impact us that much, but certainly, as we get through the next quarter, I think you're going to continue to see very good results from us as a result of the pricing cycle and booking cycle that we have.

Speaker Change: May impact some of our competition should have less of an impact on us we do see the same cycle happening again.

Speaker Change: History has been repeating itself consistently since 2021, and we do expect prices, which have as you've correctly pointed out been falling of late.

Speaker Change: Hey, not to impact us that much.

Speaker Change: But certainly as we get through the next quarter.

Speaker Change: I think youre going to continue to see very good results from us as a result of the.

Speaker Change: Pricing cycle and booking.

Speaker Change: People that we have that.

Alan Kestenbaum: That may not be the case in June. We might see some softness in June, but as I said, we did a very good job of selling. You know, pretty similar looking quarter. And then as we get into the next quarter, I think we're gonna see it again. The ongoing economy is good. Water patterns are such that buyers will probably come rushing in again all at once, and we'll have yet another spike in the next quarter.

Speaker Change: That may not be the case in June we might see some softness in June but as I said, we did a very good job of selling out as much as we could and so we're expecting to have a.

Speaker Change: So pretty similar looking.

Speaker Change: Quarter end.

Speaker Change: And then as we get into next quarter I think we're going to see it again the underlying economy is good.

Speaker Change: Order patterns are such that buyers will probably come rushing in again all the months.

Speaker Change: Yet another spike in the next quarter, that's what we're anticipating so again to repeat the softness that you're referring to is very very recent over the last couple of weeks.

Alan Kestenbaum: That's what we're anticipating. So again, to repeat, the softness that you're referring to is very, very recent in the last couple of weeks. Fortunately for us, we've done a good job of selling ahead to the quarter as much as we could. That will impact to some degree towards the end of this quarter, but I expect we should balance out into the third quarter as well as possibly start moving up again.

Speaker Change: Fortunately for US we've done a good job of selling ahead to the quarter.

Speaker Change: As much as we could and.

Speaker Change: Impact to some degree in towards the end of this quarter, but I expect we'll should balance out into the third quarter as well as prices start moving up again.

Alan Kestenbaum: Okay, and maybe as a follow-up on the product mix, since you're trying to increase utilization of the Valiad side, how should we think about the mix going forward?

Speaker Change: Okay, and maybe as a follow up on the product mix since youre trying to increase utilization of the valley outside how should we think about the mix going forward.

Speaker Change: So this is.

Alan Kestenbaum: So this is a dramatic, major, and important shift for this company. And if you recall, Katja, when we talked about this last quarter, we remain almost 50% underutilized on our cold mill, coating lines, and painting lines. Each one of those facilities has different amounts.

Speaker Change: Dramatic major an important shift for this company.

Speaker Change: And if you recall I'll touch on when we talked about this last quarter.

Speaker Change: We remain almost 50% underutilized, but our cold mill coating lines and painting lines.

Alan Kestenbaum: This is essentially a CapEx-free opportunity for us to go and expand that. We're being modest in our expectations. We do expect, on an annualized basis, to see an increase in that part of the business by over 15% as we get through this year and even much more next year. Very, very focused on making sure we keep our top-rated performance that we have enjoyed in the hot roll part of the business and also make sure we deploy that in the downstream part of the business. These are customers that are much more used to just-in-time delivery and reliable deliveries, and we want to make sure that we're able to service these customers in the right way.

Speaker Change: Each one of those facilities have different amount this is essentially.

Speaker Change: Capex free opportunity for us to go and expand that we're being modest in our expectations. We do expect an annualized basis to see an increase in that part of the business by over 15% as.

Speaker Change: As we get through this year and even much more.

Speaker Change: Next year very very focused on making sure we keep our top rated.

Speaker Change: Performance.

Speaker Change: We have enjoyed in the hot rolled part of the business to also make sure we deploy that in the downstream part of the business. These are customers that are much more used to just in time delivery reliable deliveries and we want to make sure that we're able to service. These customers in a right way. So it's an incremental grew.

Alan Kestenbaum: So it's incremental growth. We're going to see a nice bit of a bump up this year to the tune of about 15% on an annualized basis. And we're starting to see it now.

Speaker Change: Growth.

Speaker Change: We're going to see a nice bit of a bump up.

Speaker Change: This year to the tune of about 15% on an annualized basis, we're starting to see it already now a little bit of that is even going to be reflected in this coming quarter. The current quarter that we're in right now and and even much more so we've got pretty ambitious plans. We have a three phase plan that's been enrolling over the next two years and I'll.

Alan Kestenbaum: A little bit of that is even going to be reflected in this coming quarter or the current quarter that we're in right now, and even much more. So we've got pretty ambitious plans. We have a three-phase plan that's going to roll out over the next two years, and the output of this company, the footprint of this company, the way this company is viewed in terms of a full top-to-bottom supplier, never sacrificing margins, will be apparent over the next couple of years.

Speaker Change: Put it this company the footprint of the company.

Speaker Change: This company is viewed in terms of a full top to bottom supplier never sacrificing margins.

Speaker Change: Is it going to be apparent over the next couple of years. So look for about 15% annualized basis as we get through this year, we'll update you for next year, but we're expecting a pretty sizable increase keep in mind, we've got the ability to we've got about 60% capacity utilization available and in that part of the business.

Alan Kestenbaum: So look for about 15% annualized basis as we get to this year. We'll update you for next year, but we're expecting a pretty sizable increase. Keep in mind, we've got the ability to-we've got about 50% capacity utilization available in that part of the business, and we're working very, very hard on this new initiative to accomplish this. You know, I heard this, heard the source of this initiative. When we saw in December that Nippon was paying nine times for a U.S. deal, I look at our multiple today, we're at 2.54, 2.54, that's six and a half turns less than the U.S. deal. Unbelievable.

Speaker Change: We're working very very hard at this new initiative too.

Speaker Change: To accomplish this just to remind everybody who may not have.

Speaker Change: I heard this but I've heard the source of this initiative.

Speaker Change: When we saw in December and independent is playing paying nine times for U S. Steel I looked at our multiple today, we're 254 to 546 and a half turns less than USD.

Speaker Change: Unbelievable.

Alan Kestenbaum: And we look at our business and say, like, wow, what are we doing wrong? What can we do better? We've got the highest margins in the industry. We return the most capital of any company. And yet, we've traded a paltry 2.54 multiple, and that calculation is very simple. You take our market cap, you deduct our cash because we have no debt, 645 million in cash, and you come to an enterprise value of 1.525, and you annualize our current quarter of about 150 million, that's 600, and you come to about 2.54.

Speaker Change: And we look at our business and say like Wow, what are we doing wrong, what could we do better and we've got the highest margins in the industry. We returned the most capital of any company and yet we trade at a pull through to five four multiple and that calculation is very simple you take our market cap deduct our cash because we have no debt.

Speaker Change: $645 million of cash when you come to an enterprise value of $1 five to five and you annualize our current quarter of about $150 million. That's a 100 and you come to about 2.5 core.

Speaker Change: And it's really a lot of multiple pick up in one of the things. We did after the last quarter and I've mentioned this on the last call for those of you who.

Alan Kestenbaum: And there's really a lot of multiple pickups. And one of the things we did after the last quarter, and I mentioned this on the last call, for those of you who missed it, I'm sorry, and I'll explain it now. For those of you who have heard it, I'll update you.

Speaker Change: I missed it I'm, sorry, and I'll explain in now suppose you've heard it.

Alan Kestenbaum: But what we've seen is like, what did U.S. Steel do right that we can do better at? And one of the things that we know Nippon was very, very attracted to, and some of the things we can do in terms of its penetration into key and core markets on the downstream, that's something that we have the ability to do. So we believe that this is not only going to result in higher profitability, but again, we're sitting in a leading profit margin position.

Speaker Change: I'll update you, but what we've seen is like what is the USDA do write that.

Speaker Change: We can do better at and one of the things that we know Nippon was very very attracted by some.

Speaker Change: Some of the things we can do.

Speaker Change: In terms of its penetration into key and core markets on the downstream that's something that we have the ability to do so.

Speaker Change: We believe that this is not only going to result in higher profitability and again, we're sitting in a leading profit margin position 10 out of the last 14 quarters. We've had the highest profit margin, including this very quarter and based on what you've heard from others will probably do it again this quarter.

Alan Kestenbaum: 10 out of the last 14 quarters, we've had the highest profit margin, including this very quarter. And based on what you've heard from others, we'll probably do it again this quarter. If we can get from 21% margins in a mediocre quarter and bump another 5% or 10% out of that by shifting to higher value-added products—and when I say higher value-added products, I'm talking about higher value to the customer and higher value to our shareholders, where we make more profits.

Speaker Change: We can get from 21% margins mediocre quarter bump out another 5% or 10% out of that by shifting to higher value add products and when I saw higher value added products I'm talking about.

Speaker Change: The value add to the customer and higher value to our shareholders. When we make more profit we're going to have a machine here, that's not only going to make more money get re rated on.

Alan Kestenbaum: We're going to have a machine here that's not only going to make more money but be re-rated on a multiple basis to something a lot closer to what Nippon put forward for U.S. Steel. So that's the plan. We're on our way. We're very, very determined. And we expect that we're going to be successful at it. And we're being modest, as I said, 15 percent annualized basis for 24. I hope to double that for 2025. And that's what you guys posted on that.

Speaker Change: On a multiple basis is something a lot closer to what Newport.

Speaker Change: Put forward for U S deal. So that's the plan we're on our way with very very determined and we expect that we're going to be successful at it and we're being as I said, 15%.

Speaker Change: Annualized basis for 'twenty, four I hope to double that.

Speaker Change: For 2025, and that's what you guys posted on that.

Speaker Change: Perfect. Thank you.

Speaker Change: Thank you for your question. Our next question comes from the line of Bill Peterson with Jpmorgan.

William Chapman Peterson: Thank you for your question. Our next question comes from the line of Bill Peterson with J.P. Morgan. Bill, your line is now open.

William Chapman Peterson: Your line is now open.

William Chapman Peterson: Good morning, Alan and Paul This is Ben it on to Bill.

Bennett: Good morning, Alan and Paul. This is Bennett on Tribil. I was hoping we could get a little more color on what you're seeing in customer demand from your different end markets, which are the strongest and weakest, and how the order book's looking so far for the second quarter.

William Chapman Peterson: Yeah.

William Chapman Peterson: I was hoping to get a little more color on what youre seeing on customer demand from your different end markets, which are the strongest to weakest and how the order books looking so far for the second quarter. Please.

Alan Kestenbaum: The order book, as I just mentioned in the prior question, the order book's looking very good. We did a good job selling out early. We're in June right now. The latter part of June, we have a little bit left. We expect to fill out, and fortunately, we did most of our selling when prices were higher. The demand has been steady in all areas, markets, energy, construction, autos, service centers. It's really

Bill: The order book as I just mentioned in the prior question. The order book is looking very good.

Bill: We did a good job selling out early.

Bill: We're in June right now.

Bill: The latter part of June we have a little bit left and how do we expect to fill out. Unfortunately did most of our selling when prices were higher.

Bill: And as the demand has been steady in all areas to markets energy construction.

William Chapman Peterson: <unk> service centers.

William Chapman Peterson: It's really been studied.

Alan Kestenbaum: Everyone predicted certain reactions to interest rates to hurt construction and auto sales, but we're seeing steady demand from our customers. The ebbs and flows that we see are pricing-related. I think that the downstream customers have become much smarter, as they should, about what's going on in the steel market. They try and time their order patterns to when they think prices have bottomed out. That's when they tend to come rushing in, but we follow our customer inventories very, very closely.

William Chapman Peterson: One one predicted the certain.

William Chapman Peterson: Our reaction to interest rates to start construction in auto sales.

William Chapman Peterson: We're we're seeing steady demand from our customers the ebbs and flows that we see is pricing related I think that the downstream customers have become much smarter and as they should to to what's going on in the steel market in the city to try and do their order patterns tied to when they see prices.

William Chapman Peterson: When they think prices have bottomed out that's when they tend to come rushing in but we follow very very closely our customer inventories the customer inventories.

Alan Kestenbaum: The customer inventories are lightening, yet once again, as the prices drop, and we expect those customers to rush back in and give us another wedge on pricing. But underlying demand is really the key point, and you're asking the actual, really most important question. What does the underlying demand look like in those key markets? I would say, from the top, construction.

William Chapman Peterson: Yet once again as the prices dropped and we expect those customers to rush back and give us another wind up on pricing, but underlying demand is really the key point and youre asking the actual really most important question what is the underlying demand look like in those key markets.

William Chapman Peterson: And I would say from the top construction.

Alan Kestenbaum: Very good demand for products that go into things like data centers and warehouses and things like that. Same with resi, seeing good construction numbers there. We're getting good orders for our galvanized and coated products. A lot of it goes into residential. Then oil is steady. You guys have seen the SAR numbers.

William Chapman Peterson: Very good demand for.

William Chapman Peterson: Products that go into things like data centers, and warehouses and things like that same with <unk>.

William Chapman Peterson: Seeing good construction numbers there, we're getting good orders for our galvanizing coated products a lot of it goes into residential.

William Chapman Peterson: Then what always steady you guys have seen the Saar numbers those are pretty pretty steady.

Alan Kestenbaum: Those are pretty steady. Oil and gas demand remains good, particularly on the oil side. Really, across the board, we're seeing demand steady.

William Chapman Peterson: While oil and gas remains good, particularly on the oil side. So.

William Chapman Peterson: Really across the board, we're seeing demand spread.

William Chapman Peterson: Great.

Speaker Change: Great. Thanks for that color Alan and then real quick given your leverage to spot pricing I was hoping to get your thoughts on the recent spot pricing now being put into the market by two of our U S peers.

Alan Kestenbaum: Thanks for that color, Alan. And then, real quick, given your, you know, leverage on spot pricing, I was hoping to get your thoughts on the recent spot pricing now being put in the market by two of your US peers. You know, what impact do you perceive this having on the market and or, you know, potentially easing pricing volatility through the cycle?

Speaker Change: What impact do you perceive is having on the market <unk> potentially easing pricing volatility through the cycle.

Alan Kestenbaum: It's really too early for me to give you a projection on how that's going to impact the market. There is a CRU number that's published every week. Now this is yet another number, another data point. We now have several data points. We have the two producers that are putting out weekly prices, we have the future prices, and we have CRU. I don't really see much of an impact just yet and will probably be happy to answer that question after we have a little bit of experience three to six months down the road. Certainly, you know, I don't see much of an impact, positive or negative, on our business.

William Chapman Peterson: Really too early for me to give you that.

Speaker Change: Uh huh.

Speaker Change: The projection on how that's going to impact the market. There has been a there was a <unk> number that's published every week.

Speaker Change: This is yet another number another data point. So we have several data points. We have two producers that are putting up quickly prices, we have the future prices and we have the tru and.

Speaker Change: Don't really see much of an impact just yet and probably probably be happy to answer that question, because we have a little bit of experience three to six months down the road.

Speaker Change: Certainly.

Speaker Change: No.

Speaker Change: I don't see much of an impact.

Speaker Change: Positive or negative.

Speaker Change: To our to our business.

Speaker Change: Understood. Thanks, so much best of luck moving forward.

Bennett: Understood. Thanks so much. Best of luck. I'm looking forward to it.

Speaker Change: Thank you.

Speaker Change: Thank you for your question. Our next question comes from the line of James Mcgarrigle with RBC. James Your line is now open.

Operator: Thank you for your question. Our next question comes from the line of James McGarragle with RBC. James, your line is now open.

James McGarragle: Thanks for having me on, and congratulations on the industry-leading margins. I just wanted to ask a question on the new coal contracts. You know, we've seen lower gas, and natural gas prices, and the impact on costs. Looking ahead, you know, so Cleveland Cliffs expects, you know, around a 20 to $30 per ton decrease in costs, mainly on the back of their local coal contracts and natural gas prices. You know, is that the right way to think about it for your business? And are we expecting those to start flowing through costs in Q2? Or is that more of a Q3 story?

James McGarragle: Yes, thanks for having me on and congrats on the industry leading margin.

James McGarragle: I just wanted to ask a question on the new core contract.

Alan Kestenbaum: Thanks.

Speaker Change: Laura.

Speaker Change: Gas prices.

James McGarragle: And the impact on costs looking ahead.

James McGarragle: Cleveland cliffs flag around 20 to $30 per ton decrease in costs, mainly on the back of their loyalty.

James McGarragle: Core contract and natural gas prices.

Speaker Change: Is that the right way to think about it for your business and how are you.

Speaker Change: Are you expecting those to start flow through cost in Q3, starting in Q2, we're not more of a Q3 story. Thanks.

Speaker Change: Yes, so we will start to see some of those costs.

Alan Kestenbaum: Yes, we will start to see some of those costs drop in Q2 and Q3. Those are the right ingredients, it's natural gas, and coal, so we will definitely see some of those costs start to positively impact our costs. We're already seeing that in Q2, and it should continue to accelerate at the end of Q2 and Q3 as well, and Q4 for that matter, so we're anticipating to have some lower costs. Pricing can stay on average through the year as we've been seeing it. We should be having a pretty good year and hope to be able to achieve all of our capital and investment initiatives and goals.

Speaker Change: Drop.

Speaker Change: In in Q2 and Q3.

Speaker Change: Those are the right the right ingredients, it's natural gas assets its coal.

Speaker Change: So.

Speaker Change: We will we will definitely see some of those costs start to positively impact our costs, we're already seeing that in Q2 and then it should.

Speaker Change: It should continue.

Speaker Change: Continuing to accelerated end of Q2 and in Q3 as well in Q4 for that matter. So we're anticipating to have some lower cost.

Speaker Change: Pricing can stay.

Speaker Change: On average through the year.

Alan Kestenbaum: As as we've been saying, we shouldn't we should be having a pretty good year and I hope to be able to achieve all of our.

Speaker Change: Capital and investment initiatives and goals.

Speaker Change: Okay, Thanks, and just a thought.

Alan Kestenbaum: Just a follow-up for me on some of the recent infrastructure announcements. We saw a big pickup in investment from the Government of Canada in the budget.

Speaker Change: For me on some of the recent infrastructure announcements, we saw a big pick up in investment from the government of Canada and the budget.

Alan Kestenbaum: That new Honda.

Alan Kestenbaum: We have that new Honda EV plant as an example. On the one hand, steel pricing is going to be driven by what happens in the US market. But on the other hand, having some big projects in your backyard is probably going to be pretty good for business. What type of impact do you see these projects having on your business if you look a little longer term into 2025 and 2026?

Speaker Change: <unk> plant as an example, so on one hand, you know steel prices is going to be driven by what happens in the U S market, but on the other hand, having some big projects in your backyard is probably going to be pretty good for business.

Speaker Change: What type of impact do you see from these projects having on your business. If you look a little longer term in 2025 and 226.

Speaker Change: Yes, the impacts or Exxon, there's been a lot of growth in Canada. There is the ones that you mentioned the big infrastructure projects that are definitely consume a lot of steel and we're right at the forefront to be able to service into that and so that's.

Alan Kestenbaum: Yeah, the impacts are excellent. There's been a lot of growth in Canada. There are the ones that you mentioned, the big infrastructure projects that definitely consume a lot of steel, and we're right at the forefront to be able to supply that, and so that's really good. And then, you know, in addition to that, Canada continues to have an acute housing shortage. You drive around Canada, and the construction, despite the higher interest rate environment, is strong.

Speaker Change: That's really good.

Speaker Change: And then.

Speaker Change: In addition to that.

Speaker Change: Canada continues to have an acute housing shortage.

Speaker Change: You drive around Canada and in the construction.

Speaker Change: Spike higher interest rate environment.

Speaker Change: Is strong and so that's also very very good for us and the other thing since you mentioned the budget there are a number of them.

Alan Kestenbaum: And so that's also very, very good for us. And the other thing, since you mentioned the budget, there are a number of... budgetary allotments that directly will impact us in terms of certain investments that we want to make that are working their way through. And really, really very excited about all of that.

Speaker Change: Budgetary allotments for for that directly will impact us in certain cerner in terms of certain investments that we want to make that are working their way through.

Speaker Change: And I'm really really very excited.

Alan Kestenbaum: And in all of that so the Canadian environment, It's very very positive you're right. We think a lot about the U S and really focus on the U S. But were in Canada, and predominantly you know more than 80% of our shipments staying in Canada and while the impact of our pricing is very much related to what goes on in the U S. The local demand in Cana.

Alan Kestenbaum: So the Canadian environment is very, very positive. You're right, we think a lot about the U.S. and really focus on the U.S., but we're in Canada, and predominantly more than 80% of our shipments stay in Canada. And while the impact of pricing is very much related to what goes on in the U.S., the local demand in Canada is excellent. Economic planning that's taken place, especially on a provincial level in our home court in Ontario, has really been wonderful. And we speak to these guys all the time.

Speaker Change: Excellent economic planning, that's taken place, especially on the provincial level in our home Court in Ontario has really been a wonderful.

Speaker Change: Speak to these guys all the time the traveling around the world getting guys like <unk> that have come in and and and and invest in you know these are all really really exciting opportunities for us along with the other things that are in the budget not enough time to go through them right now, but a lot of very positive.

Alan Kestenbaum: They're traveling around the world, getting guys like Hans that have come in and invested. And these are all really, really exciting opportunities for us, along with the other things that are in the budget. Not enough time to go through them right now, but there are a lot of very positive aspects in that budget that will impact us in a very positive way.

Speaker Change: Aspects in that budget that will impact us.

Speaker Change: A very positive way.

Speaker Change: I appreciate it and I'll turn the line over thank you.

James McGarragle: I appreciate it, and I'll turn the line over to you. Thank you.

Speaker Change: Thank you for your question. Our next question comes from the line of Adam Snyder with Cormack Securities. Adam Your line is now open.

Operator: Thank you for your question. Our next question comes from the line of Adam Schneider with Cormark Securities. Adam, your line is now open.

Adam Schneider: Hey, good morning, I'm, just filling in for David today, I have a couple of questions about the free cash flow.

Adam Schneider: Hey, good morning. I'm just filling in for David today.

Adam Schneider: Given your strong cash balance of $645 million what are your plans for that cash. This year is it 10, cib's gross capex or acquisitions.

Adam Schneider: So in terms of capital allocations, we break it down into three buckets Theres investment back in the facility one thing we've learned.

Adam Schneider: I have a couple of questions about free cash flow. Given your strong cash balance of $645 million, what are your plans for that cash this year? Is it NCIBs, growth capex, or acquisitions?

Alan Kestenbaum: So, in terms of capital allocations, we break it down into three buckets. There's investment back in the facility. One thing we've learned, and I've learned over the course of my 30-year career is the importance of investing back into the facility. We've put in over a billion dollars of capital back into the facility, and we intend to continue to allocate additional cash accumulations into the facility to make sure we maintain reliability and our cost competitiveness. So, that's one aspect of the use of cash.

Alan Kestenbaum: And I have lost over the course of my.

Alan Kestenbaum: 30 year career, the importance of investing back into the facility, we've put in over $1 billion of capital back into the facility and and we intend to continue to allocate.

Alan Kestenbaum: And you know additional cash accumulation into the facility to make sure we maintain.

Alan Kestenbaum: Reliability.

Alan Kestenbaum: Cost competitiveness.

Alan Kestenbaum: Others, as you pointed out, I mentioned in a previous call that we have three capital initiatives this year. We've got share buybacks, special dividends, and ordinary dividends, and then, of course, investments back into the facility. With the way business is looking this year, and with our cash balance, we should be able to hit on all of them. Let me just remind everybody that last year we paid a $3 special dividend, in addition to the annualized current ordinary dividend of $2. $5 is a 12% return on this stock, just on dividends.

Alan Kestenbaum: One aspect of the.

Alan Kestenbaum: Use of cash are there as you pointed out I mentioned in a prior call.

Alan Kestenbaum: That we have three capital initiatives. This year, we've got share buybacks.

Paul D. Scherzer: Special dividends and in ordinary dividends and and then of course the investments back in the facility with the way business is looking this year with a cash balance we should be able to hit on all of them.

Alan Kestenbaum: Let me just remind everybody we paid.

Alan Kestenbaum: Last year.

Alan Kestenbaum: A $3 special dividend.

Alan Kestenbaum: That's in addition to the annualized current ordinary dividend of $2.

Alan Kestenbaum: $5 as.

Alan Kestenbaum: 12% return on this stuff just on dividend, so we hope to be able to do.

Alan Kestenbaum: So we hope to be able to do that. We hope to be able to, and we expect to be able to do more share buybacks. We just started them at the beginning of March, and we intend to.

Alan Kestenbaum: Do that we hope to be able to.

Alan Kestenbaum: To be able to do.

Alan Kestenbaum: More share back share buyback, we just started them at the beginning of March.

Alan Kestenbaum: And we intend to.

Alan Kestenbaum: Capital investments back from the facility, share buybacks, dividends, and then, of course, when you look at M&A and opportunities, we try to be really, really smart and really long-term. And because we've got industry-leading metrics, we want to make sure that whatever we buy has enormous synergies. Nobody has the cost structure we have.

Alan Kestenbaum: Capital investments back from the facility's share buybacks dividends and then of course.

Alan Kestenbaum: When you look at it.

Alan Kestenbaum: And M&A opportunities.

Alan Kestenbaum: We tried to be really really smart and really long term and because we've got industry, leading metrics you want to make sure that whatever we buy has enormous synergies nobody has the cost structure. We have there's nothing we can buy that's going to have the same profit margin, we have but we know with our capability.

Alan Kestenbaum: There's nothing we can buy that's going to have the same profit margin we have. We know, with our capability and our know-how and synergies, we can actually make acquisitions and participate in M&A that could be extremely, extremely meaningful to the shareholders of this company. So very, very focused on that. There are not a lot of players out there that have the financial flexibility, know-how, experience, and skill to go and actually execute a very successful M&A transaction. And so we remain very, very focused on that. But M&A is something that's unpredictable. It's opportunistic.

Alan Kestenbaum: And our Knowhow and synergies, we can actually make acquisitions and participate in M&A that could be extremely extremely meaningful to the shareholders of this company. So very very focused on that I'm doing a lot of players out there that has the financial flexibility knowhow experience skill to go and actually execute.

Alan Kestenbaum: A very successful in the ne transaction.

Alan Kestenbaum: And so we remain very very focused on that but.

Alan Kestenbaum: M&A is something Thats unpredictable, it's opportunistic we're not we're not like Starbucks, we're going to go and build a you know 200 stores this year or whatever it is this is a company that lives by.

Alan Kestenbaum: We're not like Starbucks. We're going to go and build 200 stores this year or whatever it is. This is a company that lives by being able to exploit opportunities. We have very, very flexible balance sheets to enable us to do that. So when you think about capital allocation, think about CapEx, share buybacks, dividends, and when M&A is available to us, we will be in position to execute it in a way that's extremely creative for shareholders.

Alan Kestenbaum: To exploit opportunities.

Alan Kestenbaum: We are very very flexible balance sheet to enable us to do that so when you think about capital allocation think about capex share buybacks dividends and when M&A.

Alan Kestenbaum: Is available to us.

Alan Kestenbaum: We will be in position to execute on in a way that's extremely.

Alan Kestenbaum: It's accretive to shareholders.

Speaker Change: Okay, Great that's very helpful. Thanks.

Adam Schneider: Okay, great. That's very helpful. Thanks. And just a quick follow-up with regard to your inventory monetization arrangement. Is the expectation to use that less now, given the high interest rate environment?

Adam Schneider: Just a quick follow up with regards to your inventory monetization arrangement is your expectation to use that less now that given the high interest rate environment.

Adam Schneider: Look we have an internal rate of return on our on our investments of 25%. So the answer is no. We believe we can take our capital and investment.

Alan Kestenbaum: Look, we have an internal rate of return on our investments of 25%. So the answer is no.

Alan Kestenbaum: We believe we can take our capital and invest it, and we don't need to sit and put it into working capital. So, you know, when we get to a place of interest rates where we have no better opportunity for it and, you know, it's better to own inventory, we'll do that. But, you know, we become just look at our numbers.

Alan Kestenbaum: We need to sit in and put it into a into a into working capital.

Alan Kestenbaum: So when we get to a place where interest rate, where we have no better opportunity for it and and its been at our own inventory, we will do that but we've become just look at our numbers $2 $1 billion of shareholder returns.

Alan Kestenbaum: $2.1 billion of shareholder returns. I mean, we are so efficient in our working capital management, and even with the higher interest rates, we're able to continue to do that. I just looked at our dividends, our share buybacks, our special dividends. We've been able to do that. So, we always look at what can we do with our capital. And as I mentioned in your prior question, these are investments in the facility. We have a minimum threshold of 25%.

Alan Kestenbaum: I mean, we are so efficient that our working capital management.

Alan Kestenbaum: And even with the higher interest rates, we're able to continue to do that I'll, just look at our dividends or share buybacks or special dividends have been able to do that so.

Alan Kestenbaum: This is a we always look at what can we do with our capital and as I mentioned on your prior question. These are investments in the facility, we have a minimum threshold of 25% that's a heck of a lot more than than the.

Alan Kestenbaum: That's a heck of a lot more than the interest we pay. And so, we're going to continue to be really, really smart and efficient with our working capital. We, of course, always have the ability to pay that down if we think that was the most efficient thing to do, but we're always looking at efficiency and how do we make the best use and value out of our assets.

Alan Kestenbaum: Then the than the interest we pay.

Alan Kestenbaum: So we're going to we're going to continue to be really really smart and efficient without working capital. We of course always have the ability to pay that down.

Alan Kestenbaum: If we thought that was the most efficient thing to do but we're always looking at efficiency.

Alan Kestenbaum: And how do we take make the best use and value of out of our assets.

Speaker Change: Okay, great. Thank you and sorry, just one quick one I know you mentioned the six cyclicality earlier of the steel price but.

Adam Schneider: Okay, great. Thank you. And sorry, just one quick one. I know you mentioned the cyclicality of the steel price earlier, but just wondering quickly what your expectation is for the cost per ton this year.

Adam Schneider: Okay, great. Thank you. And sorry, just one quick one. I know you mentioned the sickle.

Adam Schneider: Just wondering quickly what your expectation is for cost per ton this year.

Speaker Change: I'm going to go down.

Adam Schneider: Thank you Adam for your question. Our next question comes from the line of Bill Peterson with Jpmorgan. Your line is open.

Operator: Thank you, Adam, for your question. Our next question comes from the line of Bill Peterson with J.P. Morgan. Bill, your line is open.

William Chapman Peterson: Thanks, Ben It on again here just wanted to squeeze one more in.

William Chapman Peterson: Thanks, Bennett on again here. I just wanted to squeeze one more in.

William Chapman Peterson: You've done a great job outlining the capital allocation framework as it relates to the buyback dividends Capex. It's.

William Chapman Peterson: Good to see the this strategy importing with greater leverage downstream, but I wanted to focus a little bit more on de carbonization in the past you've spoken about a potential investment on this front. So wondering if there's any updates there and what the opportunities are for potential government support.

Alan Kestenbaum: Alan, you've done a great job outlining the capital allocation framework as it relates to the buyback dividends, and CapEx. It's good to see the strategy unfolding with greater leverage downstream. But I wanted to focus a little bit more on decarbonization. In the past, you've spoken about potential investments on this front. So wondering if there are any updates there and what the opportunities are for potential government support.

William Chapman Peterson: So on the government support and the carbonation we've had.

Alan Kestenbaum: A major major advancements on all fronts, both in terms of technology government support and and otherwise.

Alan Kestenbaum: The government will dictate the timing of those announcements.

Alan Kestenbaum: Yes, on government support and decarbonization, we've had major, major advancements on all fronts, both in terms of technology, government support, and otherwise. The government will dictate the timing of those announcements, so I'm at liberty to give you precise programs that have been awarded to us, but that will come out soon. You know, everything we planned on, we alluded to in prior conversations is happening. And then some.

Speaker Change: So I'm not at Liberty to.

Alan Kestenbaum: To give you precise.

Alan Kestenbaum: Nice programs that have been awarded to us, but that will come out soon and.

Alan Kestenbaum: Everything everything we planned on we alluded to in prior conversation is happening and then some.

Speaker Change: Alright, we will look forward to the update thank you.

Bennett: All right, we'll look forward to the update. Thank you.

Bennett: Thank you for your question there are no additional questions waiting at this time, so I will pass back to Alan Kestenbaum for any closing remarks. Thank you.

Alan Kestenbaum: Thank you for your question. There are no additional questions waiting at this time, so I will pass back to Alan Kestenbaum for any closing remarks. Thank you.

Alan Kestenbaum: Thank you very much, everyone, for your participation today. As always, we will always remain available to all of our analysts, shareholders, everybody. I think we pride ourselves on being open, being available, and really looking forward to any questions that anyone has. Please feel free to reach out to me or Paul or anybody else with any questions, ideas, or concerns. We are always happy to address them in any format. So I wish everyone a good day, and we'll speak to you next quarter. This concludes today's program.

Alan Kestenbaum: Thank you very much everyone for your participation today as always we will.

Alan Kestenbaum: We remain available to all of our analysts shareholders everybody. We I think we pride ourselves on being open being available and we look forward to any questions that anyone has please feel free to reach out to me or Paul or anybody else with any questions ideas concerns and always happy to <unk>.

Alan Kestenbaum: Dress them in any format. So wish everyone a good day and we'll speak to you next quarter.

Alan Kestenbaum: This concludes todays <unk> first quarter 2024 earnings conference call. Thank you for your participation you may now disconnect your lines.

Operator: This concludes today's Stelco First Quarter 2024 Earnings Conference Call. Thank you for your participation. You may now disconnect your line. Thank you for your participation. You may now disconnect your line.

Operator: 24 earnings Conference call. Thank you for your participation you may now disconnect your lines.