Algoma Steel Group Inc (ASTL) 2025 Q2 法說會逐字稿

Greetings and welcome to the Algoma Steel Group Inc Second Quarter, 2025 Earnings Call at this time. (Operator Instructions) It is now my pleasure to introduce your host, Michael Moraca, Vice President Corporate Development and Treasurer.

大家好，歡迎參加 Algoma Steel Group Inc 2025 年第二季財報電話會議。（操作員指示）現在我很高興介紹您的主持人，企業發展副總裁兼財務主管 Michael Moraca。

Good morning everyone and welcome to Algoma Steel Group Inc's Second Quarter, Fiscal 2025 Earnings Conference Call, leading today's call are Michael Garcia, our Chief Executive Officer ; and Rajat Marwah, our Chief Financial Officer.

大家早安，歡迎參加 Algoma Steel Group Inc 2025 財年第二季財報電話會議，今天的電話會議主持人是我們的執行長 Michael Garcia；以及我們的財務長 Rajat Marwah。

As a reminder, this call is being recorded and will be made available for replay later today. In the investors section of Algoma Steel's website, I would like to remind you that comments made on today's call may contain forward-looking statements within the meaning of applicable securities laws which involve assumptions and inherent risks and uncertainties.

提醒一下，本次通話正在錄音，今天稍後將提供重播。在 Algoma Steel 網站的投資者部分，我想提醒您，今天電話會議上的評論可能包含適用證券法含義內的前瞻性陳述，其中涉及假設和固有風險和不確定性。

Actual results may differ materially from statements made today. In addition, our financial statements are prepared in accordance with IFRS which differs from US GAAP. And our discussion today includes references to certain Non-IFRS financial measures.

實際結果可能與今天的聲明有重大差異。此外，我們的財務報表是根據與美國 GAAP 不同的 IFRS 編製的。我們今天的討論涉及某些非國際財務報告準則的財務指標。

Last evening, we posted an earnings presentation to accompany today's prepared remarks. The slide for slides for today's call can be found in the investors section of our corporate website.

昨天晚上，我們發布了一份收益報告，以配合今天的準備好的演講。今天電話會議的幻燈片可以在我們公司網站的投資者部分找到。

With that in mind, I would ask everyone on today's call to read the legal disclaimers on slide 2 of the accompanying earnings presentation and to also refer to the risks and assumptions outlined in Algoma Steele's Second Quarter, Fiscal 2025 Management Discussion and Analysis.

考慮到這一點，我請今天電話會議上的每個人閱讀隨附收益報告第 2 張幻燈片中的法律免責聲明，並參考 Algoma Steele 2025 財年第二季度管理討論與分析中概述的風險和假設。

Please note that our financial statements are prepared using the US dollar as our functional currency and the Canadian dollar as our presentation currency.

請注意，我們的財務報表以美元作為功能貨幣，以加幣作為列報貨幣來編制。

Our fiscal year runs from April 1st to March 31st and our financial statements have been prepared for the three and six months ended, September 30, 2024 and September 30, 2023.

我們的財政年度從 4 月 1 日到 3 月 31 日，我們的財務報表已編制為截至 2024 年 9 月 30 日和 2023 年 9 月 30 日的三個月和六個月。

Furthermore, today we are announcing that our Board of Directors has approved a change in Algoma's fiscal year end from March 31st to December 31st starting this year. This will result in a period of March 31st to December 31st being reported as a nine month reporting period.

此外，今天我們宣布，董事會已批准將 Algoma 的財政年度結束日期從今年的 3 月 31 日更改為 12 月 31 日。這將導致 3 月 31 日至 12 月 31 日期間被報告為九個月的報告期間。

We plan to provide reclassified historical financial information in the first quarter of 2025 to assist investors in evaluating the impact in the change in fiscal year will have on reported annual operating results for the years ended December 31st 2023 and 2024.

我們計劃在 2025 年第一季度提供重新分類的歷史財務信息，以協助投資者評估財政年度變化對截至 2023 年 12 月 31 日和 2024 年 12 月 31 日止年度報告年度經營業績的影響。

Please note all amounts referred to on today's call are in CAD unless otherwise noted. Following our prepared remarks, we will conduct a question and answer session. I will now turn the call over to our Chief Executive Officer Michael Garcia, Mike.

請注意，除非另有說明，今天電話會議中提到的所有金額均為加幣。在我們準備好的發言之後，我們將進行問答環節。現在我將電話轉給我們的執行長邁克爾加西亞 (Michael Garcia)，邁克 (Mike)。

Thank you, Mike. Good morning and thank you for joining us to discuss our fiscal second quarter, 2025 results over the last several quarters, our relentless focus on employee safety yielded measurable results demonstrated by our improved loss time injury performance.

謝謝你，麥克。早安，感謝您加入我們討論 2025 財年第二季度的業績，在過去幾個季度中，我們對員工安全的不懈關注取得了可衡量的成果，這體現在我們改善的工傷損失績效上。

With construction of the EAF project reaching peak levels of activity. Our commitment to workplace safety has never been more vital. We continue to prioritize the well being of every team member reinforcing safety is not just a corporate value but a fundamental aspect of how we operate.

電爐工程建設進入高潮。我們對工作場所安全的承諾從未如此重要。我們繼續優先考慮每個團隊成員的福祉，加強安全不僅是企業價值，也是我們營運的基本面向。

Next, I'll cover key events and milestones during our fiscal second quarter as well as give an update on progress at our Transformative EAF project.

接下來，我將介紹我們第二財季的關鍵事件和里程碑，並介紹我們變革性 EAF 專案的進展。

I will then turn the call over to Raj for a deeper dive into the numbers and a discussion of our strong liquidity and balance sheet. Before closing with an update on market conditions, there are a few important themes I would like to get across on this call.

然後，我將把電話轉給 Raj，讓他更深入地了解這些數字，並討論我們強大的流動性和資產負債表。在結束市場狀況的更新之前，我想在這次電話會議中講幾個重要主題。

First, we delivered solid operational performance in the quarter, partly blunting the impact of continued soft conditions across global steel markets.

首先，我們在本季實現了穩健的營運業績，在一定程度上抵消了全球鋼鐵市場持續疲軟的影響。

Second, our balance sheet and liquidity are strong with cash at quarter end of over $450 million and total liquidity of $800 million. We are well funded to complete our transformative EAF project in the coming months.

其次，我們的資產負債表和流動性強勁，季末現金超過 4.5 億美元，總流動性為 8 億美元。我們擁有充足的資金，可以在未來幾個月內完成我們的變革性 EAF 專案。

And finally, we have further DE risked the project with substantially all remaining items now contracted as we enter the start of commissioning activities this quarter.

最後，隨著本季我們進入調試活動開始階段，我們進一步降低了專案風險，目前基本上所有剩餘專案都已簽訂了合約。

Now let me give you some additional color on those key themes. Our results for fiscal second quarter of 2025 were in line with our previously disclosed guidance for both shipments and adjusted EBITDA.

現在讓我對這些關鍵主題做進一步的詮釋。我們 2025 財年第二季的業績與我們先前揭露的出貨量和調整後 EBITDA 預期一致。

They reflect a continuation of the challenging market conditions. We have seen this year in steel pricing which touched year-to-date lows during the quarter as uncertainty around the US election, the pace of interest rate cuts soft demand and overall economic factors weighed on our customers' buying behavior.

它們反映出嚴峻的市場環境的持續存在。由於美國大選的不確定性、降息步伐導致需求疲軟以及整體經濟因素影響了客戶的購買行為，今年鋼鐵價格已觸及年初至今的低點。

All told softer realized steel prices and lower shipments led to an overall decline in revenues adjusted EBITDA cash flow generation versus the prior year period.

總體而言，鋼鐵實際價格走軟和出貨量下降導致收入調整後的 EBITDA 現金流與去年同期相比整體下降。

Our plate shipments in the second fiscal quarter of 2025 were approximately 73,000 tons up from 61,000 tons in the fiscal first quarter.

我們的板材出貨量在 2025 財年第二季約為 73,000 噸，高於財年第一季的 61,000 噸。

Market conditions impacted our expected plate shipments. However, our production was in line with our expectations of approximately 90,000 tons.

市場狀況影響了我們預期的板材出貨量。然而，我們的產量符合我們的預期，約為 90,000 噸。

We were able to grow market share despite poor market conditions and we were able to rebuild strategic inventories for product categories that will help us improve delivery performance as we continue to position Algoma as the North American leader in customer service.

儘管市場條件不佳，我們仍然能夠擴大市場份額，並且能夠重建產品類別的策略性庫存，這將有助於我們提高交付績效，同時繼續將 Algoma 定位為北美客戶服務領域的領導者。

While there are no clear signals of the market improving in the near term, we plan to continue ramping up plate production over the balance of the fiscal year towards our expected annual run rate capacity of over 650,000 net tons.

儘管短期內沒有明顯的市場改善訊號，但我們計劃在本財年剩餘時間內繼續提高板材產量，以達到預期的年產能超過 650,000 淨噸。

We are Canada's only discrete producer of plate products and the completed modernization and associated quality and volume improvements should result in a more favorable product mix going forward that is expected to drive meaningful margin enhancement.

我們是加拿大唯一的板材產品離散生產商，完整的現代化改造和相關的品質和產量改進將帶來更有利的產品組合，有望推動利潤率的大幅提升。

Market conditions remain challenging. However, we remain focused on what we can control, including the consistent operation of our facility and unwavering focus on our customers.

市場環境依然充滿挑戰。然而，我們仍然專注於我們能夠控制的事情，包括我們設施的持續運作和對客戶的堅定關注。

We are entering our normal seasonal maintenance period but we don't expect any unusual impacts to production and should see directionally higher shipments in the third fiscal quarter.

我們正進入正常的季節性維護期，但我們預計生產不會受到任何異常影響，第三財季的出貨量應該會增加。

Now let me give you an update on our exciting progress during the quarter on our transformational electric arc furnace project with the facility now towering over our site. We are in the busiest phase of the project with nearly 500 specialized trades contractors on site.

現在，讓我向您介紹我們本季轉型電弧爐專案令人興奮的進展，該設施現已矗立在我們的工地上。我們正處於工程最繁忙的階段，現場有近 500 名專業承包商。

Critical equipment installation is well underway, including our 550-ton cranes, our fume treatment system with over 2,500 feet of large diameter piping and our automated scrap yard cranes. Critical electrical infrastructure has been installed including our Danieli Q1 power systems and our EAF Substation which has now been energized.

關鍵設備的安裝正在順利進行中，包括我們的 550 噸起重機、擁有超過 2,500 英尺大直徑管道的煙霧處理系統以及我們的自動廢料場起重機。關鍵電力基礎設施已安裝完畢，包括我們的達涅利 Q1 電力系統和現已通電的 EAF 變電站。

We have told you that we expect to commence commissioning activities by the end of this calendar year. And I'm proud to say we remain on track for that important milestone.

我們已經告訴過您，我們預計將在今年年底開始調試活動。我很自豪地說，我們仍在朝著這個重要的里程碑前進。

We have selected and staff the EAF operating team who will be tasked with executing commissioning activities beginning as expected in December and we remain on track to deliver first steel production by the end of the calendar first quarter of next year.

我們已經選定並組建了 EAF 營運團隊，他們的任務是按預期於 12 月開始執行調試活動，我們仍有望在明年第一季末交付第一批鋼鐵產品。

When both furnaces are up and running, we expect to reach a steady state shipping capacity of approximately 3 million tons per year, 35% higher than current production levels. Every bit as important as the project being on time is the milestone we reached with regard to contracting activity for the remaining construction.

當兩座高爐全部投入運作後，我們預計穩定運輸能力將達到每年約 300 萬噸，比目前的生產水準高出 35％。專案按時完成與我們在剩餘施工承包活動方面達到的里程碑同樣重要。

As you all know, we have been advancing the project during what has been a period of sustained high inflation particularly for labor and materials associated with large industrial construction projects. Our project team has worked closely with all stakeholders including major equipment suppliers and subcontractors to de risk the project at every turn.

眾所周知，我們在持續高通膨時期推進該項目，特別是與大型工業建設項目相關的勞動力和材料價格。我們的專案團隊與所有利害關係人（包括主要設備供應商和分包商）密切合作，以降低專案的每個風險。

I'm proud to share today that we have contracted substantially all the remaining work on the project as we continue to work towards the completion of construction and commissioning of both EFS. We expect to finish the project within 5% of the most recent budget guidance.

今天，我很自豪地告訴大家，我們已經承包了這個專案基本上所有剩餘工作，我們將繼續努力完成兩個 EFS 的建造和調試。我們預計該項目將在最新預算指導價的 5% 之內完成。

We are also excited to announce that Algoma's EAF project is eligible under Ontario's Ministry of the Environment Conservation and parks emissions performance program. Under this program, Algoma has applied for and expects to receive reimbursement for carbon taxes paid since 2022.

我們也很高興地宣布，阿爾戈瑪的 EAF 計畫符合安大略省環境保護部和公園排放績效計畫的要求。根據該計劃，阿爾戈瑪已申請並預計將獲得自2022年起繳納的碳稅的補償。

Driving down the net cash cost of the EAF project and further enhancing the strength of our balance sheet and liquidity.

降低EAF項目的淨現金成本並進一步增強我們的資產負債表和流動性。

Specifically during the quarter, cumulative investment of the EAF project reached $672 million. And to date, we have committed contracts totaling approximately 870 million with over 90% tied to fixed price contracts.

具體而言，本季，EAF項目累計投資額達6.72億美元。到目前為止，我們已簽訂總額約 8.7 億美元的合同，其中 90% 以上是固定價格合約。

The transition to EAF of steel making involves the support and partnership of many agencies and companies .In August, we were pleased to see PUC Transmission and Hydro One Each obtaining authorization pursuant to the Ontario Energy Board Act to construct a new 230 kilovolt transmission line and related transformation components in Sault Saint Marie.

向電弧爐煉鋼的轉型需要許多機構和公司的支持和合作8月份，我們很高興看到 PUC Transmission 和 Hydro One Each 根據安大略省能源委員會法案獲得授權，在蘇聖瑪麗建設一條新的 230 千伏輸電線路及相關變電組件。

The combined project improves the city's access to Hydro One's planned regional grid infrastructure upgrade as previously prioritized by the province of Ontario. No capital contribution from Algoma will be required for these upgrades.

該合併項目提高了該市對 Hydro One 計劃的區域電網基礎設施升級的訪問能力，這一計劃此前已被安大略省列為優先事項。這些升級不需要 Algoma 投入任何資本。

This enhancement is part of phase two of the transition to EAF steel making where power required for the two EAF will come from the grid supported by our own Lake Superior Power plant.

此次升級是向電弧爐煉鋼過渡的第二階段的一部分，其中兩個電弧爐所需的電力將來自我們自己的蘇必利爾湖發電廠支援的電網。

As a reminder, our start up plan continues to include normal production from our existing steel making facility while ramping up steel production from our EAF in calendar 2025, followed by an eventual switch to full EAF production.

提醒一下，我們的啟動計畫繼續包括現有煉鋼設施的正常生產，同時在 2025 年提高電弧爐的鋼鐵產量，最終轉向全面的電弧爐生產。

This provides us with operational flexibility as we ramp up the EAF furnaces to full production.

當我們將電弧爐提升至滿載生產時，這為我們提供了操作靈活性。

In summary, in very tough market conditions, we focused on the safe operation of our existing facilities, our customers and the planned ramp up of plate production, finalizing our contracting for the remaining components of our project and taking the first steps toward the on time start of commissioning activities for the project.

總而言之，在非常艱難的市場條件下，我們專注於現有設施的安全運作、客戶和板材產量的計劃提升，最終完成專案剩餘部分的承包，並朝著按時開始專案調試活動邁出了第一步。

As I said last quarter, the near term weakness in steel markets can't dampen our excitement for what's happening at our site. And the huge step forward it represents for our company and our community.

正如我上個季度所說，鋼鐵市場的短期疲軟無法抑制我們對現場發生的事情的興奮。它代表著我們公司和社區向前邁出了一大步。

I'd like to once again, thank all our employees for their hard work, dedication and professionalism.

我想再次感謝我們所有員工的辛勤工作、奉獻精神和專業精神。

Now, I will pass the call over to Rajat to go over our financial results for the quarter, Rajat.

現在，我將把電話轉給 Rajat，讓他報告我們本季的財務表現。

Thanks Mike, good morning and thank you all for joining the call.

謝謝麥克，早安，謝謝大家參加電話會議。

As a reminder, all numbers are expressed in Canadian Dollers unless otherwise noted.

提醒一下，除非另有說明，所有數字均以加拿大元表示。

Our second quarter results include adjusted EBITDA of 4 million which reflects and adjusted EBITDA margin of 0.6%.

我們第二季的業績包括調整後的 EBITDA 為 400 萬美元，反映調整後的 EBITDA 利潤率為 0.6%。

This includes the benefit of net insurance proceeds totaling approximately 28 million, which I will explain in more detail after.

其中包括總額約 2,800 萬美元的淨保險收益，稍後我將詳細解釋。

Cash generated from operating activities totaled 25.4 million. We finished the quarter with a strong balance sheet including $452 million of cash and availability of 348 million under our revolving credit facility, for total liquidity of approximately 800 million.

經營活動產生的現金流量總額為2,540萬元。我們以強勁的資產負債表結束了本季度，其中包括 4.52 億美元的現金和 3.48 億美元的循環信貸額度，總流動資金約為 8 億美元。

Now let me walk you through the key drivers of our performance.

現在讓我向您介紹我們業績的關鍵驅動因素。

Steel revenue was 539 million in the quarter down 19% versus the prior year period. Steel shipments were 520,000 net tons in the quarter down 5.2% versus the prior year quarter.

本季鋼鐵收入為 5.39 億，較去年同期下降 19%。本季鋼材出貨量為 52 萬淨噸，較去年同期下降 5.2%。

The decrease in shipments and revenue was largely attributable to soft market conditions and depressed pricing. Net sales realization average 1,036 per ton down 14.6% versus the prior year period.

出貨量和收入的下降主要歸因於市場疲軟和價格低迷。淨銷售平均每噸 1,036 美元，較去年同期下降 14.6%。

The decrease versus the prior year level reflects weaker market conditions partially offset by improvements in our value added product mix as a proportion of steel sales.

與去年同期相比，這一下降反映了市場條件的疲軟，但被我們增值產品結構在鋼鐵銷售中所佔比例的提高部分抵消。

On the cost side, Algoma's cost per ton of steel products sold average 1,032 in the quarter, up 1.1% versus the prior year period. The main drivers of the increase versus the prior year period include lower volumes and the increased use of purchase cost.

成本方面，Algoma本季每噸鋼鐵產品銷售成本平均為 1,032 美元，較去年同期上漲 1.1%。與去年同期相比，成長的主要原因包括銷售下降和採購成本增加。

Inventory at the quarter end was 793 million down modestly from 808 million at the end of the 2024 fiscal year. We remain focused on driving down working capital levels from a timing perspective. During the December quarter, we will grow inventories at a lower level than seen in previous years and we expect a release of at least 100 million of total working capital by March 2025 as previously discussed.

本季末的庫存為 7.93 億，較 2024 財年末的 8.08 億略有下降。我們仍然致力於從時間角度降低營運資本水準。在 12 月季度，我們的庫存成長水準將低於前幾年，我們預計到 2025 年 3 月將釋放至少 1 億的總營運資金，正如之前所討論的那樣。

One additional note on the Utility Corridor incident from last January, during the quarter, we received an advance from insurers related to property damage.

關於去年 1 月發生的公用事業走廊事件還有一點需要補充，在本季度，我們收到了保險公司與財產損失相關的預付款。

You will see approximately 32 million insurance proceeds flowing through our financial statement as other income during the quarter offset by approximately 4 million of costs associated with the outage.

您將看到約有 3,200 萬保險收益作為本季的其他收入流入我們的財務報表，抵銷了約 400 萬與停電相關的成本。

We continue to work with our adjusters on recovering funds for the balance of the property damage and business interruption claims.

我們將繼續與我們的理賠員合作，追回財產損失和業務中斷索賠的餘額。

I'd now like to turn the call back over to Michael Garcia for closing comments.

現在我想將電話轉回給邁克爾·加西亞，請他發表最後評論。

Mike, thank you, Roger.

麥克，謝謝你，羅傑。

Looking at the state of the North American steel market demand and pricing remain depressed prior to the US election contributing to overall economic uncertainty during the past quarter index pricing touched year-to-date lows in the mid 600 s while we saw some modest price improvement, it again moved lower and has traded sideways over the past few weeks. Potentially a reflection of market participants sitting on the sidelines awaiting a result from the US election.

縱觀北美鋼鐵市場的狀況，美國大選之前，需求和價格仍然低迷，導致過去一個季度整體經濟不確定，指數價格觸及 600 年代中期的年初至今低點，雖然我們看到價格略有改善，但過去幾週再次走低並橫盤整理。這可能反映出市場參與者正在觀望，等待美國大選的結果。

We are optimistic that post election steel prices will gain ground.

我們樂觀地認為，選舉後鋼鐵價格將會上漲。

We applaud Canada's recent imposition of tariffs on Chinese steel and aluminum, as it aligns Canadian trade policy more closely with the United States, fostering a unified North American approach that strengthens the regional steel market by mitigating competition from unfairly traded overseas imports.

我們讚賞加拿大最近對中國鋼鐵和鋁徵收關稅，因為此舉將使加拿大的貿易政策與美國更加緊密地結合起來，促進北美統一的做法，通過減輕來自不公平貿易的海外進口產品的競爭來加強區域鋼鐵市場。

In the near term, we do expect that current prices will continue to generate headwinds on our earnings performance on account of our lagging contract order book.

短期內，我們預計，由於合約訂單滯後，當前價格將繼續對我們的獲利表現產生阻力。

As we wait for these headwinds to abate, we will continue to focus on what we can control, operating our facilities safely, servicing our customers and positioning ourselves to best capture market opportunities as they arise, all while executing the completion of construction and commissioning of the EAF.

在等待這些不利因素減弱的同時，我們將繼續專注於我們能夠控制的事情，安全地運營我們的設施，為客戶提供服務，並定位自己以最好地抓住出現的市場機遇，同時完成 EAF 的建設和調試。

It's no exaggeration to say that in the 120 plus year history of Algoma, we are in the most exciting phase of our existence. Transitioning from traditional blast furnace steel production to being one of North America's greenest producers of steel.

毫不誇張地說，在阿爾戈瑪 120 多年的歷史中，我們正處於最令人興奮的階段。從傳統的高爐煉鋼生產轉型成為北美最環保的鋼鐵生產商之一。

This is further supported by recent modernization investments across the steelworks including Canada's only discrete plate production facility.

近期整個鋼廠的現代化投資（包括加拿大唯一的離散板材生產設施）進一步支持了這一點。

We will significantly expand our production capacity, dramatically improve our environmental footprint, energize the local economy and unlock tremendous value for all of our stakeholders.

我們將大幅擴大生產能力，大幅改善環境足跡，激發當地經濟活力，為所有利害關係人創造巨大價值。

I'm proud of what the team has accomplished. Their dedication to safety and their focus on enhancing every aspect of our operations.

我為團隊所取得的成就感到自豪。他們致力於安全並致力於加強我們營運的各個方面。

The last several years have been busy ones in Sault ST Marie and we are truly excited for what the future holds.

過去幾年，蘇聖瑪麗一直很忙碌，我們對未來充滿期待。

Thank you very much for your continued interest in Algoma steel. At this point, we would be happy to take your questions, operator. Please give the instructions for the Q&A session.

非常感謝您對 Algoma 鋼鐵的持續關注。現在，我們很樂意回答您的問題，接線員。請給予問答環節的指示。

(Operator Instructions)

（操作員指令）

Katja Jancic, BMO Capital Markets.

Katja Jancic，BMO 資本市場。

Hi. Thank you for taking my questions. Maybe starting on the working capital just to clarify. Raj. I think you said that in this current quarter, the build is not going to be as much as in the recent past. Can you talk more about what's driving that? Because I would assume that it would be higher given the EAF start?

你好。感謝您回答我的問題。也許從營運資金開始只是為了澄清。拉吉。我想您說過，本季的建設量不會像最近那麼大。您能否進一步談談推動這現象的因素？因為我認為，如果 EAF 開始起步，這個數字會更高？

Oh, I got you. So the EAF start up, will start the first heat and the, and the beginning of, you know, the EAF start up will happen end of March sometime in the next quarter.

噢，我明白了。因此，EAF 的啟動將會產生第一次加熱，並且，您知道，EAF 的啟動將在下個季度的 3 月底左右進行。

So we're not building much material specifically for EAF and for the blast furnace and coal. We already carry inventory and we are trying to manage that. So the build up, normally we build up around $150 million by December from March to December and then we bring it down. I think it will be lower than that.

因此，我們不會專門為電弧爐、高爐和煤炭生產大量材料。我們已經有庫存並且正在盡力管理。因此，我們通常會在 3 月至 12 月期間累積約 1.5 億美元，然後再減少。我認為會低於這個數字。

When you look at the three quarters, I think it will be probably around 100 million if you see the build up and then we'll see a release happening in March. But the point is right, coming year we'll see some build up happening, extra on the scrap side as we are ramping up our year. But that will be 2025, 2024 will be smoother.

當你看這三個季度時，我認為如果你看到積累，它可能會達到 1 億左右，然後我們將在 3 月看到發布。但重點是正確的，隨著我們今年的加緊努力，明年我們將看到一些累積的發生，在廢料方面會有額外的累積。但那將是2025年，2024年將會更加順利。

And can you maybe talk about how to think about that build up for the EAF sign?

您能否談談如何看待 EAF 標誌的建構？

So it will you know, we will be building up to the extent of, you know, roughly month, month and a half or next two months of inventory for scrap. But then we'll be reducing some of the material that we need for the plus furnace and the coke batteries as we will be transitioning slowly slowly out of it.

所以，您知道，我們將累積約一個月、一個半月或未來兩個月的廢料庫存。但隨後我們將減少煉焦爐和焦炭爐所需的一些材料，因為我們將慢慢地過渡到焦爐。

So the way to think about it is that we may have, you know, anywhere from 30 to $50 million of bill but eventually during the transition period, but eventually, we will see at least $100 million of further release in working capital when blast furnace and coke batteries are you know, are shut down and we are only on the EAF.

因此，考慮這個問題的方式是，我們可能會有 3,000 萬到 5,000 萬美元的帳單，但最終是在過渡期內，但最終，當高爐和焦爐關閉，我們只使用電弧爐時，我們將看到至少 1 億美元的營運資金進一步釋放。

So overall working capital wise, you know, 100 at least 100 we should see releasing by March and then we will we will see another 100 at least coming out when the last one is when, when the transition is complete in between, we may see a slight bill that happened for a year, which will be next next December.

因此，從整體營運資本方面來看，我們應該看到在 3 月份前至少有 100 個資金釋放，然後我們將看到至少另外 100 個資金釋放，當最後一個資金釋放時，當中間的過渡完成時，我們可能會看到一年內發生的一筆小額賬單，那將是明年 12 月。

And you said the side build is 30 to 40 million. Is that correct?

你說的側建設是3000萬到4000萬。那正確嗎？

I if I may, one more, on, I think Mike, you initially mentioned that for the current quarter, you expect volumes to increase a bit sequentially what will drive that increase? Because typically right in the December quarter, the the environment is a little softer. So we see most of your peers are talking about lower volumes.

如果可以的話，我再問一個問題，麥克，你最初提到，對於本季度，你預計銷量將環比增加一點，那麼是什麼推動了這一增長？因為通常在 12 月季度，環境會稍微疲軟一些。因此，我們發現大多數同業都在談論交易量下降。

Yeah, I think primarily it's our operating schedule, so we don't have any outages scheduled in the quarter. So I think you'll see our, volume increase from that perspective. You're right as we enter the holiday period, although I think there's probably a positive sentiment on economic activity. I don't think we'll see a significant demand increase over the next six or seven weeks in the quarter.

是的，我認為主要是我們的營運計劃，因此本季我們沒有任何停產安排。因此我認為從這個角度來看你會看到我們的銷量增加。您說得對，由於我們已經進入假期，所以我認為大家對經濟活動可能抱持正面情緒。我認為在本季度的未來六到七週內我們不會看到需求的顯著增長。

David Ocampo, Cormark Securities.

David Ocampo 的 Cormark Securities。

Thanks, thanks everyone. Rajat or Mike, maybe you could take this, but I was hoping you could comment on the timing and total insurance proceeds that remains to be delivered to you guys both from the damages to the property as well as the lost production that that occurred in the quarter. And then also in terms of timing and and total proceeds that could come from the Ministry of Environment Program.

謝謝，謝謝大家。Rajat 或 Mike，也許您可以接受這個，但我希望您能對時間安排和尚待交付給您的總保險收益進行評論，這些收益包括本季度發生的財產損失以及生產損失。然後還涉及時間和環境部計劃可能產生的總收益。

Sure. So on the insurance front, you know, as we've mentioned, there is you know, 50 to 60 odd million dollars that we see on the property damage, that's slightly higher. I think it will be a little over 60 million and we received some right now and we'll receive the balance between this quarter and next, most probably in the, in the next quarter, which is the March quarter.

當然。因此在保險方面，正如我們所提到的，財產損失金額約為 5000 萬至 6000 萬美元，這個數字略高一些。我認為這個數字將略高於 6000 萬，我們現在收到了一些，我們將在本季度和下一季之間收到餘額，最有可能是在下一季度，也就是三月季度。

And on the, property damage, you know, loss has been 120 to 100 30 roughly in that range as we indicated. And we should see you know more than 50% of that. Yeah, more than 50% of that recovered now. We're going through the process, as I said, it's lengthy process. We do expect to get it by before end of March or could flow into the June quarter, but that's what our hope is.

就財產損失而言，損失金額大致在 120% 到 100% 之間，正如我們所指出的。我們應該看到您了解其中的 50% 以上。是的，目前已恢復了 50% 以上。我們正在經歷這個過程，正如我所說，這是一個漫長的過程。我們確實希望能在 3 月底之前完成它，或者可以進入 6 月季度，但這正是我們的希望。

Most of it should, I mean, at least from property perspective should come by March and we're trying to see if we can get it in that quarter or it will be following for the business interruption. So that's how, that's how it will flow through on the insurance side.

我的意思是，至少從房地產角度來看，大部分應該會在三月到來，我們正在嘗試看看是否能在該季度獲得它，否則它將因業務中斷而出現。這就是它在保險方面運作的方式。

And on the carbon, we, are part of the program, we've applied for 2022 and, and it gets applied, gets applied every year. But the way to think about it is that it's, the recovery is happens based on the process and the way it's laid out, it's in, it's roughly in the 2nd year or 3rd year, it takes two years.

關於碳排放，我們是該計劃的一部分，我們已經申請了 2022 年的計劃，而且每年都會申請。但思考的方式是，恢復是基於過程和佈局方式進行的，大約是在第二年或第三年，需要兩年時間。

So that's 2022, We should get it, by, you know, either this year or early next and, and this is how it will flow. It would probably be two years delay, the way it works. So they do the work, they do the audit after the year end we file, they calculate and then it gets you in the following year. So it's a two year lag, the way we get the money.

所以那是 2022 年，我們應該在今年或明年年初之前得到它，這就是它的流程。按照目前的情況來看，可能要延遲兩年。所以他們做這項工作，他們在我們提交文件的年底之後進行審計，他們進行計算，然後在下一年為你提供數據。所以，我們獲得資金的方式有兩年的延遲。

Okay. And, and just, just so I have my numbers right. I have you guys having paid 54 million in calendar 22? Does that line up with your numbers?

好的。而且，只是為了讓我的數字正確。你們在 22 號日曆上已經付了 5,400 萬美元嗎？這和你的數字相符嗎？

No, I think it's a, it's a much lower number for calendar 22. But you start counting it.

不，我認為對於 22 號日曆來說，這個數字要低得多。但你開始計算它。

That, that was a cumulative so 22.

那是累計的，所以是 22。

Oh, Yeah. No, you're right. The cumulative is that, and it's done on a calendar year basis which will align with the fiscal year now, it becomes much easier for you guys, for us and for everybody, and we are pretty, pretty happy and excited about it.

哦，是的。不，你是對的。累計起來，它是按日曆年進行的，與現在的財政年度保持一致，這對你們、對我們、對每個人來說都變得更加容易，我們對此感到非常高興和興奮。

We, you know, it will, this is done on an annual basis which is calendar year basis and 2024 we have one more quarter and then it gets finalized. But you're right. Those are the numbers that you see and it, it's actually done year by year.

您知道，這是按年度進行的，即以日曆年為基礎，到 2024 年我們還有一個季度，然後它就會最終確定。但你是對的。這些就是您所看到的數字，它實際上是逐年完成的。

And each year that the province has to decide or declare whether the program is running for another year. So, you know, we're a little guarded in committing that, you know, all, all future carbon taxes for the life of the project, while we're, while we're undertaking this project, we will qualify on this.

並且每年該省都必須決定或宣布該計劃是否繼續運行一年。所以，你知道，我們對承諾所有未來的碳稅在專案生命週期內都是持謹慎態度的，當我們進行這個專案時，我們將符合這項要求。

But definitely, you know, that the province has made the decision, as it applies to the taxes we pay for 2022 emissions that were paid at the end of 2023.

但您肯定知道，省政府已經做出了決定，因為它適用於我們在 2023 年底繳納的 2022 年排放稅。

Okay. That, that's helpful that really helps us from a modeling standpoint and then maybe just a last one for, definitely goes to you, but it does look like the diluted share count is equal to, to the basic share count this quarter. That's probably just because of the negative income. But in the past, if you look at the quarters, it did include all the warrants in the diluted share count.

好的。這很有幫助，從建模的角度來看確實對我們有幫助，然後也許最後一個肯定是給你的，但看起來本季的稀釋股數等於基本股數。這可能只是因為負收入。但在過去，如果你看季度數據，它確實將所有認股權證都計入了稀釋股數中。

But I know the warrants can be settled on a, on a cashless basis and they're called about at 18. So what, what's the right way to think about the maximum dilution for everyone that's trying to model this one out?

但我知道認股權證可以以無現金方式結算，而且價格約為 18 美元。那麼，對於每個試圖模擬這種情況的人來說，思考最大稀釋度的正確方法是什麼？

That's a very good question, David. You know, the thing, the way, the right way to look at it is that if you're, if you're at 18, it's third dilution because it's callable, it's the strike price is 11.5 and the difference between 11.5 and 18 is, it's a six odd box and, and that's the dilution that's there from dollar perspective. So if you issue shares, then it's third dilution.

這是一個非常好的問題，大衛。您知道，正確的看待這個問題的方式是，如果您處於 18 歲，那麼這是第三次稀釋，因為它是可贖回的，它的執行價格是 11.5，而 11.5 和 18 之間的差額是，它是一個六個奇數框，並且這就是從美元角度來看的稀釋。因此，如果你發行股票，那麼這就是第三次稀釋。

So it's not the whole 24 that, that leads to the dilution. It's only third and accounting is accounting and we have to follow those rules. So we follow those rules while we show it. But from real modeling perspective, at 18, it's only third and it changes goes lower, goes higher depending upon where the share price is. But that's how to look at it. And at 18, we have the option to do a cashless settlement which brings the dilution to third.

因此，並不是全部 24 才會導致稀釋。這只是第三種，會計就是會計，我們必須遵守這些規則。所以我們在展示時要遵循這些規則。但從實際建模角度來看，18 歲時，它只是第三名，並且根據股價的位置而變化，時而走低，時而走高。但這就是我們看待它的方式。而在 18 歲時，我們可以選擇進行無現金結算，從而將稀釋度提高到三分之一。

Okay. But those are my two questions. I'll hop back in the queue. Thank you, everyone.

好的。但這是我的兩個問題。我將重新回到隊列中。謝謝大家。

Ian Gillies, Stifel.

伊恩·吉利斯（Ian Gillies），Stifel。

I asked about this last quarter. I'm going to ask again. The plate ramp, are you putting any additional thought or are you thinking about slowing that down at all or changing the mix in the near term? Just given that market seems to be a little over saturated at the moment. Pricing isn't great, etcetera.

我上個季度問過這個問題。我要再問一次。板塊坡道，您是否有任何額外的考慮，或者您是否考慮在短期內減慢其速度或改變組合？只是鑑於目前市場似乎有點過度飽和。定價不太好，等等。

Well, I mean, we're not t going out and destabilizing the market by, by chasing a lot of of plate business. We are rebuilding strategic inventories.

嗯，我的意思是，我們不會透過追逐大量的板材業務來破壞市場穩定。我們正在重建戰略庫存。

So we're, if we have a slow demand for plate, which we've certainly had during this previous quarter, We're doing a few things. We're making sure that we are rebuilding some of our strategic stocks. So that includes both our just in time, you know, automotive program, which need to be fully stocked because that's the expectation of those automotive customers.

因此，如果我們對板材的需求緩慢，就像上一季那樣，我們會採取一些措施。我們正在確保重建一些戰略儲備。所以這包括我們的準時制汽車計劃，該計劃需要完全備貨，因為這是汽車客戶的期望。

But also building some on the floor inventory of plate that we know is going to sell. It's not you know, it's high demand products or grades and, and sizes that are that our existing customers are regular consumers of.

但我們也建立了一些我們知道將要出售的板材庫存。你知道，這並不是說這些產品或等級以及尺寸需求量很大，我們的現有客戶都是這些產品的常客。

We are taking the advantage of time to finish any of the modernization work that needs to be done in terms of proving and, and improving our rolling profile of some of the thinner gray material, the half inch and below.

我們正在利用時間來完成所有需要進行的現代化工作，以驗證和改進一些較薄的灰色材料（半英寸及以下）的軋製輪廓。

So we are being mindful of that and we're taking advantage of the the slow time and plate demand building up our promised performance and, and we think when plate demand returns will be really well positioned to take advantage of that.

因此，我們牢記這一點，並利用淡季和板材需求來提高我們承諾的業績，而且我們認為，當板材需求回升時，我們將能夠很好地利用這一點。

Understood that, that's helpful with respect to the EAF and the new cost budget put out just to confirm. But is there much left that could change in the updated budget or do you feel like you're kind of pretty much tied down there? And this is a final, final number?

明白了，這對於 EAF 和新推出的成本預算的確認很有幫助。但是，更新後的預算中是否還有很多可以改變的地方，或者您是否覺得自己已經受到了很大的束縛？這是最終的數字嗎？

Yeah, we feel really good that that not much is going to change. In fact, you may have noticed we didn't refer to it as a as a different budget. I mean, the budget is what we previously disclosed and, and I think now we're focused on communicating where we're going to end up and we're having better and better and more confident visibility to that, now as as we approach commissioning.

是的，我們感覺非常好，因為不會有太大的變化。事實上，您可能已經注意到我們並沒有將其稱為不同的預算。我的意思是，預算是我們之前披露的，而且我認為現在我們專注於溝通我們的最終目標，隨著我們接近調試，我們對此有越來越好和更自信的了解。

So substantially, all of the contracted work is in place and contracted. We've got less than 10% of the of the budgeted work operating under time and material. We're probably at a high level 60% through all that time and material work. And the actual spending on that work is tracking about where it should be tracking. So there hasn't been a cost overrun on that time and material work.

因此，實質上所有承包工作均已到位並簽訂完畢。我們的時間和材料完成情況還不到預算工作的 10%。透過所有這些時間和物質工作，我們可能已經達到了 60% 的高水準。這項工作的實際支出與應支出的支出大致相同。因此，在時間和材料工作上並沒有出現成本超支。

If you look back to the life of this project, when the cost of the project has increased from the original budget number, it has not been because of poor execution by a contractor that, you know, gets cost overruns from us that are legitimate cost overruns. So that hasn't increased any of the, you know, that's not what's driven up the cost and it hasn't been a time of material contract that has been overspent.

如果回顧該專案的整個過程，您會發現專案成本已超過原始預算金額，這並不是因為承包商執行不力，您知道，我們導致的成本超支是合法的。所以這並沒有增加任何成本，你知道，這不是導致成本增加的原因，也不是材料合約超支的時候。

What's caused the cost of the of the of the project to go up again is not poor execution. It's finishing all the detailed design and then placing the contracts in a pretty inflationary environment. So we just, you know, the contracts got placed at a higher cost than the original budget contemplated.

導致該專案成本再次上升的原因並不是執行不力。它完成了所有詳細的設計，然後將合約置於相當通膨的環境中。所以，你知道，合約的成本高於最初預算的成本。

But that being said the work is being executed as contemplated once the contracts are in place. So we feel confident about where we're going to end up and it'll be, you know, I can't give you an exact number, but it's going to be south of that 5% number we referenced.

但話雖如此，一旦合約簽訂，工作就會按計劃進行。因此，我們對最終的結果充滿信心，你知道，我無法給你一個確切的數字，但它將在我們提到的 5% 的南部。

Understood that's, that's very helpful. And I guess last one for me, are you able to provide any context and how you think cost per ton may trend over the next couple quarters as you start to use more of your own cooking coal rather than some of the third party you've had probably a purchase and sitting in inventory?

明白這一點，非常有幫助。我想最後一個問題是，您能否提供一些背景信息，以及您認為未來幾個季度每噸成本的趨勢如何，因為您開始更多地使用自己的烹飪用煤，而不是從第三方購買並存放在庫存中的煤？

Sure. So, you know, overall when you look at it for the next next year, the cost will be trending slightly lower. You know, as I mentioned, we have most of the fixed costs tied up based on all the people that we need for the year, all sitting there on some of the variable side where commodity pricing is coming down cold Coke for next year. I think we should see some reduction coming.

當然。所以，你知道，總的來說，展望明年，成本將略有下降。你知道，正如我所提到的，我們的大部分固定成本都是根據我們全年所需的所有人而確定的，這些成本都存在於一些可變因素中，而明年商品價格將會下降，冷可樂也是如此。我認為我們應該會看到一些減少。

And generally when you look at our cost, first calendar quarter cost is always slightly higher just because of winter, and you know, getting all those commodities here, primarily power and gas that goes up and the consumption also goes up.

一般來說，當你查看我們的成本時，會發現第一季的成本總是會略高一些，這僅僅是因為冬季的緣故，你知道，這裡所有的商品，主要是電力和天然氣的價格上漲，消耗量也會上漲。

So that you see that slightly, but overall you'll see the cost coming down and coming down further with the production increase that will happen as we stabilize the 1st year and then start work on the second and, and get that.

所以你會看到這一點略有不同，但總的來說，隨著產量的增加，你會看到成本不斷下降，當我們穩定第一年並開始第二年的工作時，成本就會進一步下降。

So that's, that's how we see it in. You will not see a substantial drop frankly and not even a substantial increase. It probably will be hovering within a couple of percentage point. You know, on the cost side, as you see it right now, the mix does make a change when we do hire plate, our cost proportionately will go up. But overall from a cost per ton basis, we don't see a significant change happening and we see it coming down as we start producing more.

這就是我們所看到的情況。坦白說，你不會看到大幅下降，甚至不會看到大幅成長。該比率可能會在幾個百分點之間徘徊。您知道，在成本方面，正如您現在所看到的，當我們租用板材時，組合確實會發生變化，我們的成本也會相應上升。但總體從每噸成本來看，我們沒有看到發生重大變化，而且隨著我們開始增加產量，成本會下降。

Does that help? I mean, I'm not giving you a number but I it's probably within a couple of percentage points.

這樣有幫助嗎？我的意思是，我不會給你一個數字，但可能在幾個百分點之內。

No, that's helpful and it's just a matter of us figuring out where plates, how much plate you're going to be putting out the door. So, anyways, thanks very much.

不，這很有幫助，我們只需要弄清楚車牌放在哪裡，以及要丟出門多少車牌。所以，無論如何，非常感謝。

Thank you.

謝謝。

Thank you. We have reached the end of our question and answer session. I'd like to turn the call back over to Mr. Garcia for any closing remarks.

謝謝。我們的問答環節已經結束。我想將電話轉回給加西亞先生，請他做最後發言。

Thank you and thank you again for your participation in our second quarter, fiscal 2025 earnings conference call and for your continued interest in Algoma Steel.

謝謝您，再次感謝您參加我們的 2025 財年第二季財報電話會議，並感謝您對 Algoma Steel 的持續關注。

We look forward to updating you on our results and progress when we report our fiscal third quarter results scheduled for February. That is all, Operator. Thank you.

我們期待在二月報告第三財季業績時向您通報我們的業績和進展。就這樣吧，操作員。謝謝。

Thank you. This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation and have a wonderful day.

謝謝。今天的電話會議到此結束。現在您可以斷開您的線路。感謝您的參與並祝您有美好的一天。