Heavy snowfalls since late November have affected installation of Algoma Steel's game-changer electric arc furnaces, but steel production using the new technology is still expected to begin at the end of the first quarter of 2025.
"The electric arc furnace project reached a major milestone in the quarter with the commencement of cold commissioning activities, which are accelerating," said Michael Garcia, the Sault steelmaker's chief executive officer, in a statement released after the close of stock trading on Thursday.
"We encountered record days of snowfall in late November and early December at the site which briefly impacted project work," Garcia said.
"Our team is working hard on mitigating these impacts and we do not expect any material delay in our plan for first steel production by the end of the first quarter 2025.
"We continue to make significant progress in our strategic transformation to become one of North America's leading low-carbon steel producers, setting the stage for an exciting 2025."
The company also disclosed that it expects a loss in adjusted EBITDA (a measurement of operating performance) of $55 million to $65 million during the fiscal quarter ended Dec. 31.
Algoma uses its own definition of adjusted EBITDA: "net (loss) income before amortization of property, plant, equipment and amortization of intangible assets, finance costs, interest on pension and other post- employment benefit obligations, income taxes, restructuring costs, impairment reserve, foreign exchange gain, finance income, inventory write-downs, carbon tax, changes in fair value of warrant, earnout and share-based compensation liabilities, transaction costs, share-based compensation, and past service costs related to pension benefits and post-employment benefits."
The company also projects total steel shipments for the quarter to be in the range of 545,000 to 550,000 tons.
"Despite market headwinds, our results for the quarter demonstrated solid operational execution, particularly in our plate business where production continued on its upward trajectory," Garcia said.
"While macroeconomic uncertainties persist in the steel sector, we remain positioned to capitalize on improving fundamentals as conditions normalize."