Algoma Steel Group (ASTL) Q2 2025 earnings summary

Executive summary

• Revenue and profitability declined sharply year-over-year, with Q2 revenue at $600.3M and a net loss of $106.6M, driven by lower steel prices and shipments.

• Adjusted EBITDA was $4M (0.6% margin), down 96% year-over-year, with net sales realization at $1,036/ton and cost per ton at $1,032.

• Maintained strong liquidity, ending the quarter with $452M in cash and over $800M in total liquidity.

• Advanced EAF project, with commissioning set for year-end 2024 and first steel production expected by end of Q1 2025.

• Board approved a change in fiscal year-end to December 31, resulting in a nine-month reporting period for 2024.

Financial highlights

• Steel revenue was $539M, down 19% year-over-year; shipments were 520,443 tons, down 5.2% year-over-year.

• Adjusted EBITDA was $4M, with a margin of 0.6%, including $28M in net insurance proceeds.

• Net loss was $106.6M, compared to net income of $31.1M in the prior-year quarter.

• Cash generated from operating activities totaled $25.5M.

• Net sales realization averaged $1,036/ton, down 14.6% year-over-year; cost per ton averaged $1,032, up 1.1% year-over-year.

Outlook and guidance

• EAF commissioning to begin by year-end 2024, with steel production expected by end of Q1 2025.

• EAF project expected to reduce annual carbon emissions by ~70% and improve conversion costs.

• Expect directionally higher shipments in the third fiscal quarter due to no scheduled outages.

• Plan to ramp up plate production toward an annual run rate capacity of over 650,000 net tons.

• EAF project expected to finish within 5% of the most recent budget guidance.