NEW YORK Essar Steel Algoma Inc. swung to its seventh consecutive quarterly loss, but broke even on a pre-tax basis due to cost improvements coupled with higher sales and shipping rates, the company said Nov. 12.
The Sault Ste. Marie, Ontario-based steelmaker posted a net loss of Canadian $110.1 million ($105 million) for its fiscal second quarter ended Sept. 30, widening 40.6 percent from a $78.3-million net loss in the same period last year, despite sales that rose 13 percent to C$464.4 million ($442.8 million) from C$410.9 million.
Steel shipments rose 17.1 percent to 641,625 tons during the quarter from 528,110 tons a year earlier, although realized sales prices declined 6.9 percent to C$638 ($608.38) per ton.
However, the flat-rolled producers earnings before interest, taxes, depreciation and amortization (Ebitda) totaled C$300,000 ($286,071) during the quarter, in contrast to negative Ebitda of C$5.5 million in the comparable year-ago period.
"Our improved Ebitda reflects firmer pricing in both sheet and plate products, and we are encouraged by recently announced price increases, which run counter to the normal seasonality," chief executive officer Kalyan Ghosh said in a statement. "Our focus now is on liquidity as we look to build our raw material inventories in advance of winter lock closures on the seaway."
Quarterly sheet and strip division sales jumped 14.1 percent to C$347.1 million ($330.9 million) from C$304.2 million in the fiscal second quarter of last year, while plate sales fell 12.6 percent to C$62.3 million ($59.4 million) from C$71.3 million in the same comparison.