Algoma execs tout business as usual after earlier outage

He added that successful repairs from the utilities corridor collapse and plate mill modernization “will result in sequentially higher shipments in fiscal Q1’25 and further improvement in the quarters ahead.”

The Sault Ste. Marie, Ontario based steelmaker recently unveiled its newly modernized plate mill, Canada’s only discrete plate and heat-treat facility.

“Our operations and commercial teams are focused on ramping up production and sales of plate products over the balance of the fiscal year, putting us on a path towards our expected annual run-rate capacity of over 650,000 net tons,” Garcia said.

He noted that despite the facility being offline for three weeks, “our plate production in the fiscal first quarter of 2025 is expected to be ~65,000 tons.”

He said “that would be in line with past quarters that had no maintenance outage and indicative of the higher run rate we expect going forward.”

Looking towards fiscal Q2’25, Garcia said Algoma expects plate mill production to reach ~90,000 tons.

As previously reported, the steelmaker estimated the production loss from its 3-week unplanned BF outage in January to be ~150,000 tons of hot metal.

The outage occurred when a structure that held up utilities piping for the mill’s coke plant collapsed. The BF was shut down as a precaution.

Financial impacts

This impacted adjusted Ebitda by CA$120-130 million. The company is seeking insurance reimbursement for the incident, but it’s unclear if it will receive any.

When asked by analysts, CFO Rajat Marwah said that ~CA$70 million of the company’s ~CA$120 million of cap-ex in the quarter went for repairs because of the incident.

“It’s all because of the coke oven collapse, the utility corridor,” he said. “And we are discussing with the insurance providers on that aspect as well, so which will be recovered once it’s settled,” which he noted will probably come in fiscal 2025.

Garcia said the “outage highlighted the challenges of operating facilities that, in some cases, are over 70 years old.”

However, he said the company’s “long-term strategy remains unchanged and on track to successfully execute our EAF project, and transition to being one of the leading producers of green steel in North America.”