Q1 2025 Algoma Steel Group Inc Earnings Call
Speaker Change: [music].
Greetings welcome to no unless T O group incorporated first quarter 2025 earnings call. At this time all participants are in a listen only mode. A question and answer session will follow the formal presentation.
Operator: Greetings.
Operator: Welcome to Algoma Steel Grp Incorporated First Quarter 2025 Earnings Call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance, please press star zero on your telephone keypad. As a reminder, this conference is being recorded.
Speaker Change: If anyone should require operator assistance. Please press star zero on your telephone keypad. As a reminder, this conference is being recorded it is now my pleasure to introduce Michael Morocco, Vice President corporate development and Treasurer. Thank you Michael you may begin.
Michael Moraca: It is now my pleasure to introduce Michael Moraca, Vice President, Corporate Development and Treasurer. Thank you, Michael. You may begin.
Michael Moraca: Good morning everyone, and welcome to Algoma Steel Grp Inc.'s first quarter 2025 earnings conference call.
Speaker Change: Good morning, everyone and welcome to Algoma Steel group Inc's first quarter 2025 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 web site at.
Michael Moraca: Leading today's call are Michael Garcia, our Chief Executive Officer, and Rajat Marwah, 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 Steel's corporate website at www.algoma.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 IFRS accounting standards, which differ from U.S.
Speaker Change: Www Dot Algoma dotcom.
Speaker Change: 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. R S accounting standards, which differ.
Michael Moraca: GAAP. And our discussion today includes references to certain non-GAAP financial measures.
Speaker Change: From U S GAAP and our discussion today includes references to certain non-GAAP financial measures.
Michael Moraca: Last evening we posted an earnings presentation to accompany today's prepared remarks. The slides for today's call can be found in the investor section of our corporate website.
Speaker Change: 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 two of the accompanying earnings presentation and to also refer to the risks and assumptions outlined in Algoma Steel's first quarter.
Michael Moraca: With that in mind, I would ask everyone on today's call to read the legal disclaimers on slide 2 of the accompanying earnings presentation and to also refer to the risks and assumptions outlined in Algoma Steel's first quarter 2025 management discussion and analysis. 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. Please note all amounts referred to on today's call are in Canadian dollars unless otherwise noted.
2025, management's discussion and analysis.
Speaker Change: Please note that our financial statements are prepared using the U S dollar as their functional currency and the Canadian dollar as our presentation currency. Please note all amounts referred to on today's call are in Canadian dollars unless otherwise noted.
Michael Moraca: Following our prepared remarks, we will conduct a question and answer session.
Speaker Change: Following our prepared remarks, we will conduct a question and answer session.
Michael Garcia: I will now turn the call over to our Chief Executive Officer, Michael Garcia. Mike. Thank you, Mike, and good morning, everyone. Thank you for joining us to discuss our first quarter 2025 results. Employee safety remains our highest priority and a core value. We continue to focus on this priority, emphasizing a culture of safety throughout the steelwork. With construction activity levels at the site continuing, maintaining a strong safety focus is more critical than ever.
Speaker Change: I will now turn the call over to our Chief Executive Officer, Michael Garcia, Mike. Thank you, Mike and good morning, everyone.
Speaker Change: Thank you for joining us to discuss our first quarter 2025 results.
Speaker Change: Employee safety remains our highest priority and a core value. We continue to focus on this priority emphasizing a culture of safety throughout the steelworks.
Speaker Change: With construction activity levels at the site continuing.
Speaker Change: Maintaining a strong safety focus is more critical than ever.
Michael Garcia: Before turning to financial results, I want to highlight three important themes. First, our quarterly results reflect the continued challenging conditions across global steel markets, particularly due to tariff uncertainty and Canadian trade policy, which led to lower realized pricing and higher production costs. Second, we continued to advance EAF construction activities across the site and commissioned several critical systems, positioning us to achieve first steel production from our initial EAF during the second quarter, with no material change to our project cost or 2025 production expectations. And third, our balance sheet and liquidity position remain strong, with over $226 million in cash at quarter end and total liquidity of $587 million.
Speaker Change: Before turning to financial results I want to highlight three important themes.
Speaker Change: First our quarterly results reflect the continued challenging conditions across global steel markets, particularly due to tariff uncertainty and Canadian trade policy, which led to lower realized pricing and higher production cost.
Speaker Change: Second we continued to advance a F construction activities across the site and commission several critical systems positioning us to achieve first steel production from our initial <unk> during the second quarter with no material change to our project cost or 2025 production expectations.
Speaker Change: And third our balance sheet and liquidity position remains strong with over $226 million in cash at quarter end and total liquidity of $587 million.
Michael Garcia: We remain well funded to complete our transformative EAF project. Steel industry is navigating a period of elevated volatility, largely due to ongoing tariff actions creating uncertainty in both U.S. and Canadian markets as customers adjust purchasing patterns in anticipation of supply disruption. This trade policy uncertainty has also impacted the U.S. dollar exchange rate, influencing our raw material cost and competitive pricing position. We are managing our existing operations during this period to respond to rapidly changing market conditions, strategically adjusting our product mix between plate and coil products based on capacity and contractual obligations. Our first quarter results were in line with our expectations for shipments and adjusted EBITDA, which include insurance proceeds that Rajat will discuss shortly.
Speaker Change: We remain well funded to complete our transformative EIF project.
Speaker Change: The steel industry is navigating a period of elevated volatility largely due to ongoing tariff actions, creating uncertainty in both U S and Canadian markets as customers adjust purchasing patterns in anticipation of supply disruptions.
Speaker Change: This trade policy uncertainty has also impacted the U S dollar exchange rate.
Speaker Change: Influencing our raw material costs and competitive pricing position.
Speaker Change: We are managing our existing operations during this period to respond to rapidly changing market conditions strategically adjusting our product mix between plate and coil products based on capacity and contractual obligations are.
Speaker Change: Our first quarter results were in line with our expectations for shipments and adjusted EBITDA, which include insurance proceeds that Roger will discuss shortly.
Michael Garcia: The quarter reflected challenging market dynamics that began mid-2024, driven by U.S. election uncertainty. interest rate concerns and softening demand, factors that intensified with new U.S. trade policies announced in March. As a result, we saw softer realized steel prices and higher costs leading to an overall decline in revenues and adjusted EBITDA compared to the prior year. On a positive note, we continue to ramp up production at our fully modernized plate. For the quarter, plate shipments reached approximately 91,000 tons. up from 82,000 tons in Q4 of 2024 and 73,000 tons in Q3 of 2024. Looking ahead, we expect Q2 2025 plate production to again be directionally higher as we continue to capitalize on our position as Canada's only discrete plate producer.
Speaker Change: The quarter reflected challenging market dynamics that began mid 2024, driven by U S election uncertainty interest rate concerns and softening demand.
Speaker Change: Factors that intensified with new U S trade policies announced in March.
Speaker Change: As a result, we saw softer realized steel prices and higher cost leading to an overall decline in revenues and adjusted EBITDA compared to the prior year.
Speaker Change: On a positive note we continue to ramp up production at our fully modernized plate mill for.
Speaker Change: For the quarter plate shipments reached approximately 91000 tons.
Speaker Change: Up from 82000 tonnes in Q4 of 2024 and 73000 tonnes in Q3 of 2024.
Speaker Change: Looking ahead, we expect Q2 2025 plate production to again be Directionally higher as we continue to capitalize on our position as Canada's only discrete plate producer.
Michael Garcia: steadily ramping toward our expected annual run rate capacity of over 650,000 net tons.
Speaker Change: Steadily ramping toward our expected annual run rate capacity of over 650000 net tons.
Michael Garcia: We recently announced our participation in Team Vigilance, strengthening our position in the Canadian defense supply chain, and we are encouraged by the federal government's renewed focus on domestic military procurement and infrastructure spending, which we believe will support future demand for our plate products.
Speaker Change: We recently announced our participation in team vigilance strengthening our position in the Canadian defense supply chain and we are encouraged by the federal government's renewed focus on domestic military procurement and infrastructure spending, which we believe will support future demand for our plate products.
Speaker Change: Okay.
Michael Garcia: Turning to our Transformational Electric Art Furnace Project. While unusually harsh weather conditions that began in November and persisted through much of the winter impacted project timelines, we used the opportunity to advance other work not on the critical path. This included commissioning the fume treatment plant and water treatment plant, positioning the furnace, and energizing the substation. We anticipate achieving first steel production from our initial EAF during the second quarter, with no material change to our project cost or 2025 production expectations. Despite the challenging market conditions we have faced, our balance sheet and liquidity position remain robust.
Speaker Change: Turning to our transformational electric arc furnace project.
Speaker Change: While unusually harsh weather conditions that began in November and persisted through much of the winter impacted project timelines, we use the opportunity to advance other work not on the critical path. This.
Speaker Change: This included commissioning the fumed treatment plant and water treatment plant.
Speaker Change: <unk>, the furnace and energizing the substation, we anticipate achieving first steel production from our initial E. F. During the second quarter with no material change to our project cost or 2025 production expectations.
Speaker Change: Despite the challenging market conditions, we have faced our balance sheet and liquidity position remain robust.
Michael Garcia: Once both furnaces achieve full operation, we anticipate reaching a steady state shipping capacity of 3 million tons annually. This production level will optimize our currently underutilized downstream finishing capacity, significantly enhancing our operational efficiency and cost structure. As of March 31, 2025, cumulative investment for the EAF project was $824 million, including $83 million during the first quarter of 2025. All material aspects of the project have been contracted, and we continue to anticipate completing the remainder of the project, including those structured as time and material agreements, within 5% of the upper end of the previously announced budget range.
Speaker Change: Once both furnaces achieve full operation, we anticipate reaching a steady state shipping capacity of 3 million tons annually.
Speaker Change: This production level will optimize our currently underutilized downstream, finishing capacity significantly enhancing our operational efficiency and cost structure.
Speaker Change: As of March 31, 2025 cumulative investment for the AAF project was $824 million, including $83 million during the first quarter of 2025.
Speaker Change: All material aspects of the project have been contracted and we continue to anticipate completing the remainder of the project, including those structured as time and material agreements within 5% of the upper end of the previously announced budget range. Our startup plan continues to include normal production from our existing steelmaking facility.
Michael Garcia: Our startup plan continues to include normal production from our existing steelmaking facility while ramping up production from our EAFs throughout 2025 and 2026, followed by a complete transition to EAF production.
Speaker Change: While ramping up production from our Eas throughout 2025, and 2026, followed by a complete transition to E F production.
Michael Garcia: As a significant milestone in this transition, we plan to shut down No. 7 coke battery at our coke making facility later this summer. Number 7 battery is our least efficient battery and we do not expect it shut down to result in any increase to operating costs. This action reflects our confidence that our EAF transition plan remains firmly on track. In summary, despite very challenging market and weather conditions, we've maintained our focus on the safe operation of existing facilities, continued our ramp in plate production, and are approaching first EAF steel production during the quarter. Steel markets have had periods of great volatility in the past.
Speaker Change: As a significant milestone in this transition we plan to shut down number seven Coke battery at our Coke, making facility later this summer.
Speaker Change: Number seven battery is our least efficient battery and we do not expect that shut down to result in any increase to operating cost.
Speaker Change: This action reflects our confidence that our E F transition plan remains firmly on track.
Speaker Change: In summary, despite very challenging market and weather conditions, we've maintained our focus on the safe operation of existing facilities continued our ramp in plate production and are approaching first eas steel production during the quarter.
Speaker Change: Steel markets have had periods of great volatility in the past.
Michael Garcia: And during those times, we do what we always do, stay focused on the things within our control and never taking our eye off the ball as we prepare to take a tremendous step forward for our company and community. I'd like to once again thank all of our employees for their hard work, dedication, and professionalism.
Speaker Change: And during those times, we do what we always do stay focused on the things within our control and never taking our eye off the ball as we prepare to take a tremendous step forward for our company and community.
Speaker Change: I'd like to once again, thank all of our employees for their hard work dedication and professionalism.
Roger: Thank you and I'll now turn the call over to Roger for a deeper dive into our financials. Thanks.
Rajat Marwah: Thank you, and I'll now turn the call over to Rajat for a deeper dive into our finances. Thanks Mike, good morning and thank you all for joining the call. As a reminder, all numbers are expressed in Canadian Dollars unless otherwise noted. Our first quarter results included adjusted EBITDA that was a loss of $46.7 million, which reflects an adjusted EBITDA margin of minus 9% and cash generated by operating activities of $92.1 million. We finish the quarter with a strong balance sheet including $226 million of cash and availability of $361 million under a revolving credit facility.
Roger: Thanks, Mike Good morning, and thank you all for joining the call.
Roger: As a reminder, all numbers are expressed in Canadian dollars unless otherwise noted.
Roger: Our first quarter results included adjusted EBITDA that was a loss of $46 7 million.
It reflects an adjusted EBITA margin of minus <unk>, 9% and cash generated by operating activities of $92 1 million.
Roger: We finished the quarter with a strong balance sheet, including $226 million of cash and availability of $361 million under our revolving credit facility.
Rajat Marwah: Now let me dive into the key drivers of our profile. We shipped 470,000 tonnes in the quarter, up 4.2% versus the prior year quarter. The prior year quarter shipments were lower due to the impact on operations from the utility's corridor collapse and subsequent blast furnishing. Net sales realization average $9.86 per ton compared to $12.60 per ton in the prior year period. The decrease versus the prior year level reflects weakening market conditions partially offset by improvements in value-added product mix as a proportion of sales. This resulted in steel revenue of $463 million in the quarter, down 18.5% versus the prior year period as lower realized selling prices more than offset higher shipments.
Now, let me dive into the key drivers of our performance.
We shipped 470000 tons in the quarter up four 2% versus the prior year quarter.
Roger: The prior year quarter shipments were lower due to the impact on operations from the utility Scaduto collapse and subsequent blast furnace shutdown.
Roger: Net sales realization average 96 per ton compared to $12 60 per ton in the prior year period.
Roger: The decrease versus the prior year levels reflects weakening market conditions, partially offset by improvement in value added product mix as a proportion of sales.
Roger: This resulted in steam revenue of 463 million in the quarter down 18, 5% versus the prior year period, as lower realized selling prices more than offset.
Roger: Shipments.
Rajat Marwah: On the cost side, Algoma's cost per ton of steel products sold averaged $11.37 in the quarter, up 4% versus the prior year period on account of higher utility costs due to harsh winter conditions and tariffs. Starting March 12, the company has been subject to a 25% tariff on all outbound steel shipments to the United States. and for the first quarter tariff costs were 10.5 million which was included in cost of Net loss in the quarter was $24.5 million compared to net income of $28 million in the prior year quarter. The decrease was driven primarily by lower realized pricing and higher input costs as detailed above, partially offset by a $50 million receivable recorded as other income.
Roger: On the cost side, although most cost per ton of steel products sold average 11 37 in the quarter up 4% versus a variety of period on account of higher utility costs due to harsh winter conditions and Dennis.
Roger: Starting March 12, the company has been subject to a 25% tariff.
Roger: All outbound steel shipments to the United States and for the first quarter tariff costs were $10 5 million, which was included in cost of sales.
Roger: Net loss in the quarter was $24 5 million compared to net income of <unk> 8 million in the prior year quarter.
Roger: The decrease was driven primarily by lower realized pricing and higher input costs as detailed above partially offset by a $15 million receivable recorded as other income recognizing.
Rajat Marwah: recognizing the approval of a second advance of insurance proceeds from the January 2024 collapse of the utility corridor. This amount exceeds previous expectations of $20-30 million and the company expects to receive proceeds from the second advance payment prior to the end of this quarter. The company is working closely with the insurance advisors and carriers to finalize the remaining claims with the balance of payout expected by year-end. Cash generated by operations totaled $92 million for the quarter compared to $121 million in the prior year period, reflecting the softer market conditions discussed earlier. As we previously outlined, we targeted a release of approximately 100 million in working capital between March 24 and March 25, a goal we have now achieved.
Roger: Recognizing the approval of a second advance of insurance proceeds from the January 2024 collapse after utility corridor.
Roger: This amount exceeds previous expectations of $20 million to $30 million and the company expects to receive proceeds from the secondary launch statement prior to the end of this quarter.
Roger: The company is working closely with the insurance or the players and carriers to finalize the remaining claims but the balance of build expected by year end.
Roger: Cash generated by operations totaled remains 2 million for the quarter compared to $1 1 million in the prior year period.
Roger: <unk> the softer market conditions discussed earlier.
Roger: As we previously outlined.
Roger: Targeted release of approximately $100 million in working capital between March 24 in March 'twenty five a goal we have now achieved.
Rajat Marwah: This was driven primarily by a significant reduction in inventory. For context, inventory levels declined by 138 million compared to the prior year quarter and by 185 million since December 31st, 2025.
Roger: This was driven primarily by a significant reduction in inventory.
Roger: For context inventory levels declined by $138 million compared to the prior year quarter and by 185 million since December 31 2024.
Rajat Marwah: We remain focused on further enhancing working capital efficiency as we transition to EF-based steelmaking. Liquidity at quarter end totaled approximately $587 million, consisting of $226 million in cash and $361 million of availability under our existing credit facility. Based on our current liquidity position and expected cash generation, we believe we are well positioned to complete the EF project using existing resources. We have a strong funding plan and remain engaged in government programming that supports domestic steel.
Roger: We remain focused on further enhancing working capital efficiency as we transition to ESP steelmaking.
Roger: Liquidity at quarter end totaled approximately <unk> 7 million, consisting of $226 million in cash and $361 million of availability under existing credit facility.
Roger: Based on our current liquidity position and expected cash generation. We believe we are well positioned to complete the project using existing resources.
Roger: We have a strong funding plan and remain engaged in gum and programming that supports domestic steelmaking.
Roger: Okay.
Michael Garcia: I'd now like to turn the call back to our CEO, Michael Garcia, for closing comments. Thank you, Rajat. In summary, despite persistently challenging market conditions and ongoing trade policy uncertainty, we have remained focused on the safe operation of our facilities, continued the steady ramp-up of our plate production, and advanced our transformative EAF project. We are optimistic that the newly elected Canadian government will work constructively with industries like ours to advance timely solutions that strengthen both our company, the community, and support the nation's broader economic goals. With trade relationships evolving, we believe it is critical that the government immediately engage with the United States to address the Section 232 tariffs currently in place and to support fair and balanced trade between both countries.
I would now like to turn the call back to our CEO, Michael Garcia for closing comments.
Michael Garcia: Thank you Roger.
Michael Garcia: In summary, despite persistently challenging market conditions and ongoing trade policy uncertainty. We have remained focused on the safe operation of our facilities.
Michael Garcia: Continued the steady ramp up of our plate production and advanced our transformative EIF project.
Michael Garcia: We are optimistic that the newly elected Canadian government will work constructively with industries like ours to advanced timely solutions that strength in both our company the community and support the nation's broader economic goals with trade relationships evolving. We believe it is critical that the government immediately engage with United States.
Michael Garcia: <unk> to address the section 232 tariffs currently in place and to support fair and balanced trade between both countries. Resolving these issues is essential to ensuring a level playing field for Canadian steel producers supporting ongoing investment and low carbon steelmaking and protecting jobs and Canada's manufacturer.
Michael Garcia: Resolving these issues is essential to ensuring a level playing field for Canadian steel producers, supporting ongoing investment in low-carbon steelmaking and protecting jobs in Canada's manufacturing sector. We are ready to stand up for Canada and to help build Canada strong. with Canadian Steel, Canadian workers, and a shared commitment to a more sustainable future.
Michael Garcia: <unk> sector.
Michael Garcia: We are ready to stand up for Canada and to help build Canada strong.
Michael Garcia: With Canadian steel Canadian workers, and a shared commitment to a more sustainable future.
Michael Garcia: 2025 is shaping up to be one of the most exciting chapters in Algoma's history. With our modernization advancing, our transition to low-carbon steelmaking underway, and our role as a critical supplier to Canada's manufacturing and infrastructure sectors expanding, we believe Algoma is well-positioned to deliver sustainable, long-term value for all of our stakeholders.
Michael Garcia: <unk> 2025 is shaping up to be one of the most exciting chapters in Algoma history.
Michael Garcia: With our modernization advancing our transition to low carbon steelmaking underway and our role as a critical supplier to Canada's manufacturing and infrastructure sectors, expanding we believe algoma is well positioned to deliver sustainable long term value for all of our stakeholders.
Michael Garcia: I would like to once again thank all of our employees for their hard work, dedication, and professionalism. Thank you very much for your continued interest in Algoma Steel. Thank you.
Michael Garcia: I would like to once again, thank all of our employees for their hard work dedication and professionalism.
Michael Garcia: Thank you very much for your continued interest in Algoma steel.
Speaker Change: Thank you we will now be conducting a question and answer session. If he would like to ask a question. Please press star one on your telephone keypad, a confirmation tone will indicate your line is in the question queue. You May press star two if he would like to remove your question from the queue and for participants.
Operator: We will now be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. And for participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment while we poll for questions.
Speaker Change: Using speaker equipment, it may be necessary to pick up your handset before pressing the star. He is one moment, while we poll for questions.
Katja Jancic: Our first question is from Katja Jancic with BMO Capital Markets. Please proceed. I thank you for taking my questions.
Speaker Change: Our first question is from cuts yeah.
Dan: Dan <unk> with BMO capital markets. Please proceed.
Dan: Hi, Thank you for taking my questions, maybe starting on the near term looking to Q Q, how should we think about shipments given that the environment remains pretty challenging.
Rajat Marwah: Maybe starting on the near term, looking to 2Q, how should we think about shipments given that the environment remains pretty challenged? Hi Katja, this is Rajat. The, you know, the way we see it is that we'll probably be higher on a on a quarter over quarter basis, so higher trajectory from where we were last time from shipments. The environment is challenging for sure, but we'll come down to, you know, little less than our normal run rate as we move into the second quarter, but quarter to quarter will be.
Dan: Yes, Hi, Joe This is Roger.
Dan: <unk>.
Speaker Change: You know the way we see it is that we probably be higher on a.
Speaker Change: On a quarter over quarter basis, Ohio trajectory from where we were last time from shipments the environment is challenging for sure, but when you come down to.
Speaker Change: Little less than our normal run rate as we move into the second quarter, but the quarter to quarter will be higher.
Speaker Change: And if we leave aside.
Rajat Marwah: and a full page site. On the plate side we will be higher as well as you have seen the ramp from last couple of quarters. We have gone up to 90 and we will be going higher up on the plate side. And if we look year over year for the total volume, is it, you know, getting close to that? I think last year it was probably around 500,000 tons. Is that... Reasonable or? Yep. And specifically, how much higher can the plate go in the near term? versus the 91.
Speaker Change: Sorry, just on the <unk> side, we will be there will be higher as well as you've seen the ramp from last couple of quarters, you've gone down <unk> gone up to 90, and we'll be we'll be going higher up on the <unk> site.
Speaker Change: And if we look year over year for the total volume.
Speaker Change: Is it.
Speaker Change: Getting close to that I think last year. It was probably around five 500000 tons is that.
Speaker Change: Reasonable or.
Speaker Change: Yep.
Speaker Change: And specifically how much higher can to play though in the near term.
Speaker Change: The 91.
Michael Garcia: Katja, this is Mike. So obviously we'll be approaching the 100,000 ton per quarter level. I expect that we'll be at or near that in the next quarter that we report. Our share of the Canadian steel market versus, you know, if you look at where we were when we really exited and completed the modernization, our share of the Canadian steel plate market has really almost doubled since that time. There's still some competition in the Canadian plate market, although we're the only domestic plate producer, we still face competition from foreign plate every day in the market in Canada, whether it's from Taiwan, Turkey, Italy, France, Korea, and even from the U.S.
Speaker Change: Got yeah. This is Mike. So obviously, we'll be we'll be approaching the 100000 ton per.
Speaker Change: Per quarter level, I expect that that will be at or near that.
Speaker Change: <unk>.
Speaker Change: In the next quarter that we report.
Speaker Change: Our share of the Canadian steel market versus if you look at where we were when we really exited and completed the modernization our share of the Canadian.
Speaker Change: Steel plate market has really almost doubled since that time.
Speaker Change: They are still.
Speaker Change: Some competition in the Canadian plate market, although we are the only domestic plate producer, we still face competition from from foreign plate everyday in the market in Canada, whether it's from Taiwan, Turkey, Italy, France Korea.
Speaker Change: And even from the U S with some some contracts that they have so.
Michael Garcia: with some contracts that they have. So we expect that there's still room to grow and that the plating, and more importantly, the Canadian plate market itself will grow. I think it's shrunk over the last few years, but with the renewed focus by the government on building Canada strong, you know, that means a focus on infrastructure, especially energy infrastructure, defense, and maritime. All of those consume plate, and the government, I think, acknowledges and understands the strategic importance of a strong domestic steel industry, especially in plate. So I think, you know, this next quarter we'll see us moving towards 100,000 tons and then continuing to move towards our annual run rate of 650,000 tons.
Speaker Change: We expect that there's still room to grow and that the plating and more importantly, the Canadian plate market itself.
Speaker Change: We'll grow I think it's shrunk over the last.
Speaker Change: Few years, but with the renewed focus by the government on building candidates strong.
Speaker Change: That means a focus on infrastructure, especially energy infrastructure defense.
Speaker Change: And maritime are all of those consume plate and the government I think acknowledges and understands the strategic importance of a strong domestic steel industry, especially in place. So I think.
Speaker Change: This next quarter, we will see us moving towards 100000 tons, and then continuing to move towards our our annual run rate of 650000 tons.
Speaker Change: And maybe staying on the plate market.
Michael Garcia: And maybe staying on the plate market, we saw plate prices in the US increasing.
Speaker Change: It sounds like prices in the U S. Increasing how is pricing currently in the Canadian market.
Michael Garcia: How is pricing currently in the Canadian market? Canadian market is still it's it's still our most attractive pricing in the Canadian market. I think in general, the Canadian market is oversupplied in steel. Over 50% of the Canadian market is serviced by imported steel and a lot of that imported steel is you know, coming in at pretty low pricing. We believe there's a significant amount of it that is unfairly traded into Canada.
Speaker Change: Canadian market is still it's still our most attractive pricing in the Canadian market I think in general the Canadian market is oversupplied.
Speaker Change: In steel.
Speaker Change: Over 50% of the Canadian market is.
Speaker Change: Serviced by <unk>.
Speaker Change: Imported steel and a lot of that imported steel is coming in at pretty low pricing.
Speaker Change: We believe there is.
Speaker Change: A significant amount of it that is unfairly.
Speaker Change: Trade it into into Canada.
Michael Garcia: We're having active discussions with the Canadian government around what's the right trade policy that they should be putting in place to protect the strength of the domestic Canadian steel industry because it is a vitally strategic part of the Canadian economy going forward. But, you know, your question was specifically about steel pricing. It's still the most attractive segment for us. Thank you. Although it is lower than the U.S. steel price.
Speaker Change: Having active discussions with the Canadian government.
Speaker Change: Around what's the right trade policy that they should be putting in place.
Speaker Change: To protect the strength of the domestic Canadian steel industry, because it is a vital strategic.
Speaker Change: Part of of the Canadian economy going forward.
Speaker Change: So.
Speaker Change: But your question was specifically about steel pricing, it's still the most attractive segment for us.
Speaker Change: Although it is lower than that in the U S steel pricing.
Speaker Change: Our next question is from David Ocampo with core Mark Securities. Please proceed.
David Ocampo: Our next question is from David Ocampo with Cormark Securities. Please proceed. Thanks for taking my questions.
David Ocampo: Hi, Thanks for taking my questions. Mike I was hoping you could provide a little bit more commentary on on the sheet pricing discount I think on the last conference call. You guys noted a discount as high as 25% is that still the case and have you been able to find incremental incremental market demand to be able to shift more of your mix.
David Ocampo: Mike, I was hoping you could provide a little bit more commentary on on the sheet pricing discount I think on the last conference call you guys noted a discount as high as 25% Is that still the case and have you been able to find incremental pockets of demand to be able to shift more of your mix from the US to Canada because it Has been as high as 60% Yeah, David, thanks for the question. In sheet and coil, it's difficult. The Canadian market price has pretty much adjusted. almost equal to a 25% discount to the U.S.
Speaker Change: From the U S to Canada because it.
Speaker Change: Has it been as high as 60%.
David Ocampo: Yes, David Thanks for the question.
Speaker Change: In sheet and coil.
David Ocampo: It's difficult.
David Ocampo: The Canadian market price has pretty much adjusted.
David Ocampo: Almost equal to a 25% discount to the.
Michael Garcia: coil price so you know it makes for us particularly it makes us a little indifferent to whether we service a sheet order in the U.S. and pay a 25% discount or take it in Canada at a 25% lower market price. That's one of the challenges we're facing with the current Canadian steel market. It's oversupplied with coil and with the uncertainty around where the tariffs and where demand is going to go, you know, there's not much of a, there's not much increased demand right now to support higher pricing. And then I spoke about the presence of all the foreign steel in Canada, over 50% of the market.
David Ocampo: U S coil price so it makes for us, particularly it makes us a little.
David Ocampo: Indifferent to whether we serviced.
David Ocampo: Ashish.
David Ocampo: Sheet order in the U S and pay a 25% discount or a <unk>.
David Ocampo: In Canada at a 25% lower market price and that's one of the challenges we're facing with with the current Canadian.
David Ocampo: Steel market. It's just it's it's oversupplied with coil and with the uncertainty around the.
Where the tariffs and where demand is going to go you know there's not much of a.
David Ocampo: There's not much.
David Ocampo: Increased demand right now to support higher pricing and then I spoke about.
David Ocampo: The presence of all of foreign steel in Canada over 50% of the market. So I think all of those factors are are leading to the current the current situation where the.
Michael Garcia: So I think all those factors are leading to the current situation where the Canadian market pricing is significantly lower than the U.S. market pricing, and it's settling out at that 25% lower level.
David Ocampo: Canadian market pricing is significantly lower than the U S market pricing and its settling out or about that at that 25% lower level.
Speaker Change: Okay that makes sense and then if I just look at the futures market just as an indication that wants to come I mean, it's getting close to $800 a ton and with a 25% discount and then compare that to I think your breakeven cost structure on sheet. It at 650. It does suggest that there is more negative EBITDA prints.
David Ocampo: Okay, that makes sense. And then I just look at the futures market just as an indication of what's to come. I mean, it's getting close to $800 a ton. And with a 25% discount, and then compare that to I think your breakeven cost structure on sheet at $6.50, it does suggest that there's more negative EBITDA prints to come. Is that the right way to frame kind of Q2, Q3? I think looking at the futures and just discounting it and looking at the math, you'll come to those conclusions, but you start adding plate to it, it does make a difference.
Speaker Change: Is that the right way to frame kind of Q2 Q3.
Speaker Change: Yeah.
Speaker Change: Yes. Thank you looking at the future than just discounting.
Speaker Change: Looking at the math, you'll come to those conclusions, but you'll start earnings.
Speaker Change: Adding to it.
Speaker Change: It does it does make a difference.
Rajat Marwah: As we are selling more and more plate and moving more to value-added products, we do sell cold rolled and others where we fetch higher margins. So sheet-based, that's how the trajectory shows, but overall it is different. And to that, we've also been working on our cost side. We know that there will not be big change from raw material perspective as they are normally linked to either fixed price on the cold side and indices on the R&O side, but there are other costs that we are looking at optimizing and reducing to reduce our cost as we go through this year.
Speaker Change: As we are selling more and more plate and moving more to value added products. We do sell called drawdown of those would be that we fetch higher margin. So she'd base, that's how the trajectory shows but a little it is it is different in and two two to that we've also been working on our on our costs.
Speaker Change: Right.
Speaker Change: We know that there will not be big change from raw material perspective, as there normally linked to.
Speaker Change: To either fixed price on the coal side, then indices on the on the iron ore side, but there are other costs that we're looking at optimizing and reducing to reduce our cost as we go through.
Speaker Change: Through this year so.
Rajat Marwah: So just math makes sense, what you're saying, but there are a lot of other moving parts and other value-added products that do make a difference.
Speaker Change: Just not make sense, what youre, saying, but there are a lot of other moving parts and other other value added products that do make a difference.
Speaker Change: Okay, and then just a last one for me on the tariff costs $10 million in the quarter, but that was a partial tariff. So when I look at 2018, I think you guys got to close to $250 million for the year. So call. It 60 odd million for the quarter is that a good proxy for the hit that you guys may see in Q2.
David Ocampo: Just a last one for me on the tariff costs. $10 million in the quarter, but that was a partial tariff. So when I look at 2018, I think you guys got close to $250 million for the year, so call it $60 odd million for the quarter. Is that a good proxy for the hit that you guys may see in Q2? Yeah, it's close. Yeah, that's that's how it should play out.
Speaker Change: Yes, it's close yeah, that's that's how it should play out.
Speaker Change: Okay. That's it for me I'll hop back in the queue.
David Ocampo: Okay, that's it for me. I'll hop back into Q. Thanks, David.
Speaker Change: Thanks, David.
Speaker Change: Our next question is from Ian Gillies with Stifel. Please proceed.
Ian Gillies: Our next question is from Ian Gillies with Stiefel. Please proceed. Morning, everyone. Morning, Ian.
Ian Gillies: Good morning, everyone.
Speaker Change: Good morning.
Speaker Change: Mike could you, maybe just talk a little bit about what's transpired with the AF between last updated in this one.
Michael Garcia: Mike, could you maybe just talk a little bit about what's transpired with the EAF between last update and this one? I acknowledge the delay is not long, but I guess it's only been six weeks since we last spoke and I'm just curious and maybe talk a little bit about what the critical path issues are over the next, I guess, over the short term here to get your first hot metal out of the EAF. Sure. So, you know, as you know, we've been constructing and installing the new EAF complex really since April of 2022 is when we really started.
Speaker Change: The delays in our long, but I.
Speaker Change: I guess, it's only been six weeks since we last spoke and I'm, just curious and maybe talk a little bit about what the critical path issues are over the next I guess over the short term here.
Speaker Change: Our first hot metal out of the F.
Speaker Change: Sure. So you know as you know we've been constructing in installing this new Eas complex really since April of 2022 is when we really started we had the the the earthworks prepared and we really started construction in earnest. So it's been a three year.
Michael Garcia: We had the earthworks prepared and we really started construction in earnest. So it's been a three-year journey. And as you start to approach the end of that journey and anticipate, you know, fully energizing the furnace and producing metal in the furnace, you create a very detailed Gantt chart and timeline for all of the final critical steps that need to happen to put us in a position to kind of strike that first arc and melt that first heat of steel. So as we started the second half of last year, that was placing the first arc in the first quarter of 2025.
Speaker Change: Journey and as you start to approach the end of that journey and anticipate.
Speaker Change: Fully energizing, the furnace and producing metal in the furnace you create a.
Speaker Change: Very detailed.
Speaker Change: Gantt chart and timeline for all of the final critical steps that need to happen to it.
Speaker Change: Put us in a position to kind of strike that first arc and.
Speaker Change: And melt that first heat of steel.
Speaker Change: So as we started gaining visibility to this final.
Speaker Change: Timeline and final.
Speaker Change: Gantt chart.
Speaker Change: Four.
Speaker Change: The second half of last year that was placing the.
Speaker Change: The first arc in the first quarter of 2025, and that's what we communicated.
Michael Garcia: And you know, that's what we communicated. The last time we spoke six weeks ago, we now had visibility that that was going to happen in the second quarter. We were thinking second half of April. That's what we talked about. But so, you know, the change today is it's still happening in the second quarter. The factors the team has run into has primarily been weather related as we dealt with higher than expected snow events beginning in November, but really also in March we had higher than expected snow events. We had colder than expected seasonal temperatures, which affected our ability to commission some of the critical systems, especially the water treatment plant.
Speaker Change: The last time, we spoke six weeks ago, we now have visibility that that was going to happen in the second quarter.
Speaker Change: Uh huh.
Speaker Change: We were thinking second half of April that's what we talked about but.
Speaker Change: So the change today is it still happening in the second quarter.
Speaker Change: The the.
Speaker Change: Factors the team has run into is primarily been.
Speaker Change: Weather related as we dealt with.
Speaker Change: Higher than expected snow events, beginning in November, but really also in March we had higher than expected.
Speaker Change: No events, we had.
Speaker Change: Colder than expected seasonal temperatures, which affected our ability to to commission some of the critical.
Speaker Change: Our systems, especially the water treatment plant you don't you can't really commission a water treatment plant when you have sustained.
Michael Garcia: You can't really commission a water treatment plant when you have... sustain temperatures below zero. Complex Piping and Piping Installation and Hydraulics Checkout. So really it's this last intense work where we're executing the plan every day as aggressively as possible, but there's always things that could cause you to slip a day or a week at a time. And so really what's happened is we've slipped from the first quarter of 2025 into the second quarter. Understood. That's helpful.
Speaker Change: Temperatures below below zero.
Speaker Change: Complex piping and piping installation in hydraulics checkout. So so really it's this last intense work wear.
Speaker Change: We're executing the plan every day is as is.
Speaker Change: Aggressively as possible, but there's always things that could cause you to slip.
Speaker Change: Slip a day or a week at a time and so really what's happened is we slipped from the first quarter of 2025 into the second quarter.
Speaker Change: Understood that's helpful and.
Michael Garcia: And just a quick follow on for that one. When do you think you'll fire up the second furnace? Second Furnace will be at the end of the year.
Speaker Change: Just a quick follow on for that one.
Speaker Change: When do you think you'll fire up the second furnace.
Speaker Change: Second furnace will be at at the end of the year.
Michael Garcia: We're focusing on the first furnace right now. A lot of the major work for the second furnace has already been in place. I imagine the team's going to learn a lot about the final sequence of startup events and what needs to happen in order to strike that first arc. So we'll certainly apply all of that learning to the second furnace.
Speaker Change: We're focusing on the first furnace right now.
Speaker Change: A lot of the major work for the for this for the second furnaces already been in place I imagine the teams going to learn a lot about the.
Speaker Change: The final sequence of startup events and what needs to happen in order to strike that first arc. So we'll certainly apply all of that learning to the second furnace, but right now the.
Michael Garcia: But right now, the second furnace is showing the end of 2025. understood.
Speaker Change: Second furnace showing the end of 2025.
Speaker Change: Understood.
Rajat Marwah: Maybe switching gears, two separate questions in and around liquidity. I guess the first one, with respect to the working capital facility, in the event that EBITDA is negative, are you still able to draw on that facility or are there covenants that wouldn't allow you to draw on that in the event you're generating negative EBITDA? We can still draw on that.
Speaker Change: Maybe switching gears.
Speaker Change: Two separate questions in and around liquidity.
Speaker Change: I guess the first one with respect to the working capital facility in the event that EBITDA is negative.
Speaker Change: Are you still able to draw on that facility are there covenants that wouldn't allow you to draw on that in the event you're generating negative EBITDA.
Speaker Change: But we can still draw on that that.
Rajat Marwah: There is a covenant that you have to test to draw the last 10%, but you can still draw on that. And then I guess the follow-on question, fully acknowledging liquidity looks okay today, like are you debating taking on any incremental debt or looking at any of these Canadian government loan programs at the time being, or are those just going to be left out there as call options in the event they're required? So as of now, no, we are reviewing, you know, all scenarios and and we know that any scenario that we look at right now will be will be different in just a few weeks.
Speaker Change: That is does the covenant that you have to test or draw the last 10%, but you can consider drawn back.
Speaker Change: And then I guess the follow on question fully acknowledging liquidity looks okay today.
Speaker Change: Are you <unk>.
Speaker Change: <unk>, taking on any incremental debt or looking at any of these Canadian government loan programs.
Speaker Change: Time being or are those just going to be left out there as call options in the event the required.
Speaker Change: So as of now no.
Speaker Change: We are reviewing.
Speaker Change: All scenarios and we know that any scenario that we look at it right now will be there'll be different industrial weak. So there'll be a reviewing all scenarios, we have enough liquidity right now.
Rajat Marwah: So though we are reviewing all scenarios, we have enough liquidity right now.
Rajat Marwah: We are working closely with the government on. on, you know, the work related to. The trade policy is in Canada, and we would want the government to be active on discussing with the U.S. government on the trade front as well. And at the same time, we are looking at optimizing our working capital as much as we can so that we have – we can optimize it and we can use that cash if needed. But as of now, we don't see a need as we go through. And the government programs are there, and we are looking at all that is coming – that has come out up till now.
Speaker Change: We are working closely with the government on.
Speaker Change: On the work related to.
Speaker Change: The trade policies in Canada.
Speaker Change: You were born the government to be active on discussing with the U S government on on the <unk> trend as well.
Speaker Change: Uh huh.
And at.
Speaker Change: At the same time, we're looking at and optimizing our working capital as much as we can so that we have.
Speaker Change: We can optimize it and we can we can use that cash if needed but as of now we don't we don't see a need as we go through and the government programs are there and we are looking at all of that is coming that has come out of the low end there will be more clarity as the government is in.
Rajat Marwah: And there will be more clarity as the government is involved. is in play and definitely will be looking at all the government programs that are out there to manage the tariffs.
Speaker Change: Is in play and definitely we'll be looking at all the government programs that are out there to manage the tariffs.
Speaker Change: Okay.
Rajat Marwah: And Rajat, with respect to working capital, it was obviously a very strong quarter for inventory releases. Can you maybe just update us on how big of a source of funds you think working capital will be this year, now that you're through Q1, and whether that's changed? So, so we will, we will see. You know, from an inventory perspective, and you know, when you look at working capital, there are so many moving parts primarily on the receivable side based on based on how pricing is and how much you're realizing. But we do see, we do see a reduction during the year.
Speaker Change: And the result with respect to working capital. It was obviously, a very strong quarter for inventory releases can.
Can you maybe just update us on how much how big of a source of funds you think working capital will be this year now that you're through Q1 and whether that's changed.
Speaker Change: So so we will we will see.
Speaker Change: From an inventory perspective.
Speaker Change: When you look at working over there. So many moving parts primarily on the receivable side based on based on how pricing is and how much you are realizing but.
Speaker Change: We do see it to see a reduction during the year now December will make will be using some amount of some amount of inventories as we built inventories, but march to March we will not see any change any big increase it'll only be a reduction.
Rajat Marwah: Now December, we'll make, we'll be using some amount of some amount of inventories as we build inventories. But March to March, we will not see any change, any big increase, it will only be a reduction. And we'd only build a little as we go through the year on the on the inventory side, specifically the raw materials by by December. So there will be definitely some release. You know, the 50 million that that is booked as a receivable in the in the quarter will be released. And we've collected most of the money on the insurance side by now and we'll get the rest during this quarter.
Speaker Change: And we will only build a little as we go through the year on the on the inventory side, specifically the raw materials.
Speaker Change: By December so that will be definitely some release.
Speaker Change: $50 million debt that is booked as a receivable in the in the quarter will.
Speaker Change: It will be released and we've collected most of the money on the insurance side.
Speaker Change: And we'll get the rest during this quarter, so that would be a permanent release as youre seeing on the receivables side. So so there'll be puts and takes but we can see some release.
Rajat Marwah: So that will be a permanent release as you're seeing on the receivable side. So there'll be puts and takes, but we'll see some release.
Speaker Change: Okay.
Ian Gillies: Thanks very much. Thanks Ian.
Speaker Change: Thanks very much.
Speaker Change: Thanks Ian.
Speaker Change: As a reminder, the star one on your telephone keypad, if he would like to ask a question.
Operator: As a reminder, it is star one on your telephone keypad if you would like to ask a question.
James Mcgarrigle: Our next question is from James McGarrigle with RBC Capital Markets.
Speaker Change: Our next question is from James Mcgarrigle with RBC capital markets. Please proceed.
James Mcgarrigle: Please proceed. I just had a question on how we should be thinking about cost of goods sold into Q2. I know you flagged some cost control initiatives you're working through, some of the input costs are contracted, but with the EIF ramping up, can you give us some color on how we should be modeling things directionally into Q2 versus what we saw in Q1? Yeah, so in Q1, the cost was higher because of one is volume, the other is the cost of utilities as the winter was quite harsh and we were not expecting that much higher cost.
Speaker Change: Yes.
James Mcgarrigle: I just had a question on how we should be thinking about cost of goods sold into Q2, I know you flagged some.
Speaker Change: Some cost control initiatives Youre working through.
Speaker Change: Some of the input costs are contracted but yes, yes ramping up can you just give us some color on how we should be.
Speaker Change: Modeling things Directionally into Q2 versus what we saw in Q1.
Speaker Change: Yeah, So in Q1.
Speaker Change: It was higher because of <unk>.
Speaker Change: One is volume the other is the.
Speaker Change: The other is the cost of utilities.
Speaker Change: The winter was quite harsh and we were not expecting that much.
Speaker Change: That's much higher cost.
Rajat Marwah: That cost will come down. We should be around overall cost of production. We should be around, you know, $1,020, $1,030, let's say $1,020 to $1,040 range in Canadian dollars overall blended cost as we come out and we keep on optimizing that during this year.
Speaker Change: Cost will come down we should be around overall cost of production we should be around.
Speaker Change: <unk> thousand 20000 30000 22040.
Speaker Change: Our range in Canadian dollars overall blended cost.
Speaker Change: As the as we come out and we and we keep on optimizing that during this year.
Speaker Change: Okay. Thanks, and then just another one on some of the recent developments on auto tariff the U S announced.
Rajat Marwah: Hey, thanks.
James Mcgarrigle: And just another one on some of the recent developments on auto tariffs. The U.S. announced they're going to provide carmakers with credits for up to 15 percent of the value of vehicles that are assembled in the U.S. that can then be applied against the value of imported parts. I know steel wasn't specifically talked about in that announcement, but does that announcement impact your ability to pass on pricing into the U.S. at all? Or does that impact demand for your sales into the U.S. at all? Just trying to see if there's any impact from that announcement.
Speaker Change: They're going to provide carmakers with credits for up to 15% of the value of vehicles that are assembled in the U S. That can then be applied against the value of imported parts I noticed it wasn't specifically.
Speaker Change: <unk> talked.
Speaker Change: <unk> talked about in that announcement, but does that announcement.
Speaker Change: Your ability to pass on pricing into the U S. At all or does that impact demand for your sales into the U S. At all just trying to see if there's any impact from that announcement.
Michael Garcia: Hi, James. This is Mike. First of all, welcome to the call. And thank you for picking up coverage on Algoma Steel.
Michael Garcia: Hi, James This is Mike.
Speaker Change: First of all welcome to the <unk> to the.
Speaker Change: To the call and thank you for picking up coverage on on Algoma steel.
Michael Garcia: I think the biggest impact of the recent announcements yesterday around the auto industry is just, it gives more certainty to the entire automotive supply chain around what the exact impact of the current tariff regime will be. And I think any time you have more certainty, it... you know, it leads to better predictability by the whole supply chain. So it kind of helps us from understanding what the volume levels will be and probably stronger volume levels. Those will always dip when there is uncertainty, but on the pricing side, it really won't. We don't see it giving us the opportunity to benefit from pricing, but certainly the the lower level of uncertainty helps that segment for us.
Speaker Change: I think the biggest impact of the recent.
Speaker Change: Announcements yesterday around the auto industry is just it gives more.
Speaker Change: Certainty to the.
Speaker Change: To the entire automotive automotive supply chain around.
Speaker Change: What the exact impact of the current tariffs regime will be.
Speaker Change: And I think anytime you have more certainty.
Speaker Change: It's.
Speaker Change: It leads to better predictability by the whole supply chain. So it kind of helps us from understanding what the volume levels will be in <unk>.
Speaker Change: Probably stronger volume levels because.
Speaker Change: Those will always dip when there is uncertainty.
But on the pricing side, it really wont, we don't see it giving us.
Speaker Change: The opportunity to.
Speaker Change: To benefit from pricing, but certainly the.
Speaker Change: The lower level of uncertainty helps that segment for us.
Speaker Change: Okay. Thank you very much and I'll turn the line over.
James Mcgarrigle: Okay, thank you very much and I'll turn the line over. No further questions at this time.
Speaker Change: Okay.
Speaker Change: With no further questions at this time I would like to turn the floor back over to Mike Maraca for closing remarks.
Michael Moraca: I would like to turn the floor back over to Mike Moraca for closing remarks. Thanks again for your participation in our first quarter 2025 earnings conference call and your continued interest in Algoma Steel. We look forward to updating on our results and progress when we report our second quarter results this summer.
Mike Maraca: Thanks again for your participation in our first quarter 2025 earnings conference call and your continued interest in Algoma steel, we look forward to updating on our results and progress when we report our second quarter results. This summer and have a great day.
Operator: Have a great day. Thank you.
Speaker Change: Thank you. This will conclude today's conference. We thank you for your participation you may now disconnect your lines.
Operator: This will conclude today's conference. We thank you for your participation. You may now disconnect your line.
Mike Maraca: Okay.
Speaker: Thank you Let's fire up this thing