Algoma Steel today announced its financial results for the quarter ended June 30, 2000.Business Editors SAULT STE. MARIE Sault Sainte Marie — pronounced "Soo Saint Marie" (IPA /su seɪnt məˈɹi/) — is the name of two cities on the Saint Marys River, which forms part of the boundary between the United States and Canada. , ONTARIO--(BUSINESS WIRE)--July 25, 2000 Algoma Steel ''See also Algoma (Disambiguation) Algoma Steel Corporation (TSX: AGA) was founded in 1902 by Francis Clergue, an American entrepreneur who had settled in Sault Ste. Marie, Ontario. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :ALGSF) (TSE See Tokyo Stock Exchange. TSE 1. See Tokyo Stock Exchange (TSE). 2. See Toronto Stock Exchange (TSE). :ALG ALG antilymphocyte globulin. ALG antilymphocyte globulin. ALG Antilymphocyte globulin, see there .) today announced its financial results for the quarter ended June June: see month. 30, 2000.
Financial Highlights
--------------------
1999 2000
---------------------------- ----------------
Q2 Q3 Q4 Q1 Q2
-- -- -- -- --
($ millions except per share data)
Sales $295.9 $264.0 $266.0 $303.6 $304.6
EBITDA(1) $0.5 $14.1 $25.3 $30.8 $42.2
Income (Loss)
Before Taxes $(36.7) $(23.3) $(11.6) $(8.4) $ 2.2
Net Income/
(Loss) $(26.9) $(16.8) $ (7.9) $(9.0) $ 1.1
Net Income/
(Loss)
Per Share $(0.51) $(0.32) $(0.15) $(0.17) $0.02
Weighted average
shares
outstanding
(millions) 52.72 52.85 52.97 53.08 53.20
Per Ton Shipped
---------------
Revenue $518 $528 $537 $541 $575
EBITDA(1) $1 $28 $51 $55 $80
(1) Earnings before interest, taxes, depreciation and
amortization.
Steel Shipments (000's of net tons)
-----------------------------------
1999 2000
------------------------- -------------
Q2 Q3 Q4 Q1 Q2
-- -- -- -- --
Sheet 426 391 408 455 422
Plate 110 106 83 101 106
Structurals 21 - - - -
Tubulars 14 3 4 5 2
--- --- --- --- ---
Total 571 500 495 561 530
--- --- --- --- ---
Summary A net profit of $1.1 million or $0.02 per share was earned in the second quarter. This compares to a first quarter loss of $9.0 million or $0.17 per share and a net loss of $26.9 million or $0.51 per share in the second quarter of 1999. Financial and Operating Results Income from operations in the quarter was $23.8 million versus $12.4 million in the first quarter. Steel shipments in the quarter were 530,000 tons versus 561,000 tons in the first quarter. Total production on the Direct Strip Production Complex (DSPC DSPC distearoylphosphatidylcholine DSPC Direct Shell Production Casting DSPC Direct Strip Production Complex DSPC Director Strategic Planning Coordination DSPC Digital Studio Picture Control ) in the second quarter was 323,000 tons compared to 294,000 tons in the first quarter. New production records were set on the facility in both May and June. Cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses before changes in working capital in the quarter was $23.0 million, compared to $13.7 million in the first quarter. The improvement was due to a combination of higher prices and lower operating costs operating costs npl → gastos mpl operacionales . Unused availability from the banking facility was $109 million at June 30 compared to $92 million at March 31. The Company has entered into definitive agreements with a Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. subsidiary of Siderca S.A. of Argentina Argentina (ärjəntē`nə, Span. ärhāntē`nä), officially Argentine Republic, republic (2005 est. pop. 39,538,000), 1,072,157 sq mi (2,776,889 sq km), S South America. for the long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. lease of the Company's seamless tubular tubular /tu·bu·lar/ (too´bu-lar) 1. shaped like a tube. 2. of or pertaining to a tubule. tubular 1. pertaining to renal tubules. 2. pertaining to fallopian tube. facilities. Siderca S.A. is part of the global DST (1) (DeSTination) Contrast with SRC, which is an abbreviation of "source." (2) (Digital Signal Trust Company, Salt Lake City, UT, www.digsigtrust.com) An organization that sets up and manages PKI systems for companies and industry groups. group which is one of the world's largest seamless tubular producers. These agreements are expected to take effect in September September: see month. upon the clearance of corporate and regulatory requirements Regulatory requirements are part of the process of drug discovery and drug development. Regulatory requirements describe what is necessary for a new drug to be approved for marketing in any particular country. . Trade In June, the Canadian International Trade Tribunal The Canadian International Trade Tribunal is an independent quasi-judicial group operating in Canada's trade remedy system. The administrative tribunal, which considers cases of dumping and subsidizing, reports to Parliament through the Minister of Finance. determined that dumped dump v. dumped, dump·ing, dumps v.tr. 1. To release or throw down in a large mass. 2. a. carbon steel plate from Brazil Brazil (brəzĭl`), Port. Brasil, officially Federative Republic of Brazil, republic (2005 est. pop. 186,113,000), 3,286,470 sq mi (8,511,965 sq km), E South America. , Finland Finland, Finnish Suomi (swô`mē), officially Republic of Finland, republic (2005 est. pop. 5,223,000), 130,119 sq mi (337,009 sq km), N Europe. , India India, officially Republic of India, republic (2005 est pop. 1,080,264,000), 1,261,810 sq mi (3,268,090 sq km), S Asia. The second most populous country in the world, it is also sometimes called Bharat, its ancient name. India's land frontier (c. , Indonesia Indonesia (ĭn'dənē`zhə), officially Republic of Indonesia, republic (2005 est. pop. 241,974,000), c.735,000 sq mi (1,903,650 sq km), SE Asia, in the Malay Archipelago. , Thailand Thailand (tī`lănd, –lənd), Thai Prathet Thai [land of the free], officially Kingdom of Thailand, constitutional monarchy (2005 est. pop. 65,444,000), 198,455 sq mi (514,000 sq km), Southeast Asia. and the Ukraine Ukraine (y  `krān, ykrān`), Ukr. Ukraina, republic (2005 est. pop. and subsidized sub·si·dize tr.v. sub·si·dized, sub·si·diz·ing, sub·si·diz·es 1. To assist or support with a subsidy. 2. To secure the assistance of by granting a subsidy. plate from India, Indonesia and Thailand have caused material injury to the domestic industry. As a result, dumping dumping, selling goods at less than the normal price, usually as exports in international trade. It may be done by a producer, a group of producers, or a nation. margins averaging almost 40%, issued by Canada Customs and Revenue Agency Canada Customs and Revenue Agency was a department of the government of Canada. It split up into:
The Company continues to be concerned about the high levels of unjustifiably traded imports of steel entering the North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. market from offshore producers. Imports of hot rolled sheet entering Canada are up dramatically from the same period in 1999 and are contributing to the recent pricing pressures. Consideration is being given to the filing of an anti-dumping complaint against several countries. Outlook There has been some deterioration de·te·ri·o·ra·tion n. The process or condition of becoming worse. in market conditions in the third quarter due, in part, to inventory reductions by the service centres and the high levels of imported steel. This is contributing to lower selling prices for sheet and plate in the third quarter. However, underlying North American demand for steel products is still strong and, as well, offshore steel markets appear to be improving. A. ADAM H. EARL JOUDRIE PRESIDENT AND CHAIRMAN OF THE BOARD CHIEF EXECUTIVE OFFICER Sault Ste. Marie, Ontario July 25, 2000 This news release contains forward-looking information with respect to Algoma's operations and future financial results. Actual results may differ from expected results for a variety of reasons including the factors discussed in the Corporation's Management's Discussion and Analysis Management's discussion and analysis (MD&A) A report from management to shareholders that accompanies the firm's financial statements in the annual report. It explains the period's financial results and enables management to discuss topics that may not be apparent in the financial section of its 1999 Annual Report.
Algoma Steel Inc.
2000 Second Quarter Report
Unaudited - Expressed in Canadian dollars
Consolidated Statements of Income (Loss) and Retained Earnings
Three months ended Six months ended
June 30 June 30
2000 1999 2000 1999
-------- -------- -------- --------
(millions of dollars)
Sales $ 304.6 $ 295.9 $ 608.2 $ 591.6
-------- -------- -------- --------
Cost of sales 252.3 285.3 515.7 574.7
Administrative and
selling expense 10.1 10.1 19.5 20.4
Depreciation and
amortization 18.4 15.9 36.8 31.4
-------- -------- -------- --------
280.8 311.3 572.0 626.5
-------- -------- -------- --------
Income (loss) from
operations 23.8 (15.4) 36.2 (34.9)
Net financial expense 21.6 21.3 42.4 43.3
-------- -------- -------- --------
Income (loss) before
income taxes 2.2 (36.7) (6.2) (78.2)
Provision for income taxes
- current 0.7 0.8 1.3 1.7
- deferred 0.4 (10.6) 0.4 (22.5)
-------- -------- -------- --------
1.1 (9.8) 1.7 (20.8)
-------- -------- -------- --------
Net income (loss) $ 1.1 $ (26.9) $ (7.9) $ (57.4)
-------- -------- -------- --------
-------- -------- -------- --------
Net income (loss) per
common share $ 0.02 $ (0.51) $ (0.15) $ (1.09)
-------- -------- -------- --------
-------- -------- -------- --------
Weighted average common
shares outstanding
- millions 53.20 52.72 53.14 52.68
-------- -------- -------- --------
-------- -------- -------- --------
Retained earnings
Balance, beginning
of period $ 179.7 $ 199.9 $ 148.4 $ 230.4
Net income (loss) 1.1 (26.9) (7.9) (57.4)
Pension and income tax
adjustment (Note 1) - - 40.3 -
-------- -------- -------- --------
Balance, end of
period $ 180.8 $ 173.0 $ 180.8 $ 173.0
-------- -------- -------- --------
-------- -------- -------- --------
Operations
(thousands of net tons)
Raw steel production 626 588 1,235 1,195
-------- -------- -------- --------
-------- -------- -------- --------
Steel shipments 530 571 1,091 1,093
-------- -------- -------- --------
-------- -------- -------- --------
Algoma Steel Inc.
2000 Second Quarter Report
Unaudited - Expressed in Canadian dollars
Consolidated Statements of Financial Position
As at June 30
-----------------------
2000 1999
--------- ---------
(millions of dollars)
Current assets
Accounts receivable $ 200.6 $ 173.4
Income and other taxes recoverable - 13.1
Inventories 304.2 283.3
Prepaid expenses 2.9 3.3
--------- ---------
507.7 473.1
--------- ---------
Other assets
Fixed assets, net 871.4 893.3
Unamortized blast furnace lining 21.3 28.3
Future income tax asset 51.3 -
Deferred charges 35.4 37.5
--------- ---------
979.4 959.1
--------- ---------
Total assets $ 1,487.1 $ 1,432.2
--------- ---------
--------- ---------
Current liabilities
Bank indebtedness $ 92.8 $ 61.8
Accounts payable and accrued liabilities 186.6 188.0
Income and other taxes payable 8.0 -
Current portion of long-term debt 0.9 3.9
--------- ---------
288.3 253.7
--------- ---------
Other liabilities
Long-term debt 486.7 477.7
Accrued pension liability and
post-employment benefit obligation 424.8 380.7
Future income tax liability - 41.5
--------- ---------
911.5 899.9
--------- ---------
Shareholders' equity
Common shares 187.6 186.7
Shareholders' deficiency on restructuring (81.1) (81.1)
Retained earnings 180.8 173.0
--------- ---------
287.3 278.6
--------- ---------
Total liabilities and shareholders' equity $ 1,487.1 $ 1,432.2
--------- ---------
--------- ---------
Algoma Steel Inc.
2000 Second Quarter Report
Unaudited - Expressed in Canadian dollars
Consolidated Statements of Cash Flow
Three months ended Six months ended
June 30 June 30
2000 1999 2000 1999
-------- -------- -------- --------
(millions of dollars)
Cash provided by (used in)
Operating activities
Cash from operations $ 23.0 $ (14.7) $ 36.7 $ (34.7)
Decrease (increase) in
operating working
capital (0.9) 43.7 (41.2) 33.8
-------- -------- -------- --------
22.1 29.0 (4.5) (0.9)
-------- -------- -------- --------
Investing activities
Net additions to fixed
assets (11.5) (7.3) (24.3) (15.5)
Deposits in escrow - 0.9 - 0.9
-------- -------- -------- --------
(11.5) (6.4) (24.3) (14.6)
-------- -------- -------- --------
Financing activities
Repayment of long-term
debt (0.1) (0.3) (0.3) (1.2)
Common share proceeds 0.4 0.3 0.5 0.4
Increase (decrease) in bank
indebtedness (10.9) (22.6) 29.1 16.6
Financing expenses - - (0.5) (0.3)
-------- -------- -------- --------
(10.6) (22.6) 28.8 15.5
-------- -------- -------- --------
Cash
Change during period - - - -
Balance, beginning of
period - - - -
-------- -------- -------- --------
Balance, end of period $ - $ - $ - $ -
-------- -------- -------- --------
-------- -------- -------- --------
Note 1. Effective January 1, 2000 the Corporation adopted the Canadian Institute of Chartered Accountants' new accounting standards for accounting for income taxes and accounting for pension and other post-employment benefits. These had the effect of recording future tax benefits of prior year losses of $80.3 million and adding to post-employment obligations in the amount of $40 million. The changes were applied retroactively ret·ro·ac·tive adj. Influencing or applying to a period prior to enactment: a retroactive pay increase. [French rétroactif, from Latin and resulted in a net $40.3 million increase to retained earnings Retained Earnings The percentage of net earnings not paid out in dividends, but retained by the company to be reinvested in its core business or to pay debt. It is recorded under shareholders equity on the balance sheet. on January 1, 2000. |
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