Algoma Steel Group Inc (ASTL) 2025 Q3 法說會逐字稿

Please stand by. Greetings and welcome to the Algoma Steel Group Inc. third quarter 2025 earnings call. At this time all participants are in a listen-only mode. (Operator Instructions) This call is being recorded.

請稍候。各位好，歡迎參加 Algoma Steel Group Inc. 2025 年第三季財報電話會議。目前所有參與者均處於唯讀模式。（操作員指示）本次通話正在錄音。

It is now my pleasure to introduce Michael Moraca, Vice President and Corporate Development and Treasurer. Please go ahead, sir.

現在我榮幸地向大家介紹麥可·莫拉卡，他是公司副總裁兼企業發展和財務主管。請繼續，先生。

Good morning everyone and welcome to Algoma Steel Group Inc.’s third quarter 2025 earnings conference call. Leading today’s call are Michael Garcia, our Chief Executive Officer. This call is being recorded and will be made available for replay later today in the Investors section of Algoma Steel’s corporate website at www.algoma.com.

各位早安，歡迎參加 Algoma Steel Group Inc. 2025 年第三季財報電話會議。今天的電話會議由我們的執行長邁克爾加西亞主持。本次電話會議正在錄音，稍後將在 Algoma Steel 公司網站 www.algoma.com 的投資者關係部分提供重播。

I’d like to remind everyone 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. 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. Last evening we posted an earnings presentation to accompany today’s prepared remarks. The slides for today’s call can be found in the Investors section of our corporate website.

我想提醒大家，今天電話會議上發表的評論可能包含適用證券法意義上的前瞻性陳述，這些陳述涉及假設、固有風險和不確定性。實際結果可能與今天所作的聲明有重大差異。此外，我們的財務報表是按照國際財務報告準則 (IFRS) 編制的，這與美國通用會計準則 (US GAAP) 不同，我們今天的討論也涉及一些非國際財務報告準則的財務指標。昨晚我們發布了一份收益報告，以配合今天準備好的演講稿。本次電話會議的幻燈片可在公司網站的投資者關係版塊找到。

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’s third quarter 2025 Management’s Discussion and Analysis.

有鑑於此，我請今天參加電話會議的各位閱讀隨附收益演示文稿第 2 頁的法律免責聲明，並參閱 Algoma 2025 年第三季度管理層討論與分析中概述的風險和假設。

Our financial statements are prepared using the US dollar as our functional currency and the Canadian dollar as our presentation currency. All amounts referred to on today’s call are in Canadian dollars unless otherwise noted. Following our prepared remarks, we will conduct a Q&A session.

我們的財務報表以美元為記帳貨幣，以加幣為列報貨幣編制。除非另有說明，本次電話會議中提及的所有金額均以加幣計價。在發言結束後，我們將進行問答環節。

I will now turn the call over to Chief Executive Officer, Michael Garcia.

現在我將把電話交給執行長邁克爾·加西亞。

Good morning everyone and thank you for joining us today.

各位早安，感謝大家今天收看我們的節目。

As we do each quarter, I’ll begin with safety. Our commitment to workplace safety remains at the core of everything we do. I’m pleased to report that we maintained our strong safety performance this quarter, building on the improvements we achieved throughout 2024, with EAF Unit 1 ramping up and our accelerated transition to electric arc furnace steelmaking underway, we continue to prioritize the health and well-being of our workforce during this pivotal transformation.

和每季一樣，我將從安全性開始。我們始終將工作場所安全放在首位。我很高興地報告，本季我們保持了良好的安全表現，並在此基礎上，在2024年取得了顯著的進步。隨著EAF 1號機組的逐步投產以及我們加速向電弧爐煉鋼過渡，我們將繼續把員工的健康和福祉放在首位，以應對這一關鍵的轉型。

Before diving into the details, I want to highlight three important themes. First, the US 50% tariffs have effectively closed that market to us, driving lower shipments and higher production cost as we’ve pivoted our entire go-to-market strategy.

在深入探討細節之前，我想先強調三個重要主題。首先，美國 50% 的關稅實際上已經關閉了該市場，導致出貨量下降、生產成本上升，我們必須調整整個市場進入策略。

Second, we’ve secured the capital to strengthen our liquidity through $500 million in government support and an expanded $375 million ABL credit facility, extending our liquidity runway so that we can develop opportunities to diversify the business.

其次，我們透過 5 億美元的政府支持和擴大的 3.75 億美元 ABL 信貸額度獲得了資金，從而增強了我們的流動性，延長了我們的流動性儲備，以便我們能夠開發業務多元化的機會。

Third, we have embarked on an operational pivot, accelerating our EAF transformation and focusing on products for the domestic market with the goal of significantly reducing our cash burn. The steel industry is experiencing significant disruption. The 50% US tariffs implemented in June have effectively made that market no longer viable for Canadian steel producers, completely undermining our historically successful cross-border business model. These trade disruptions are reverberating globally, forcing producers worldwide to seek alternative markets while macroeconomic uncertainty compounds the headwinds facing our industry.

第三，我們已開始進行營運轉型，加速電弧爐轉型，專注於國內市場產品，目標是大幅減少現金消耗。鋼鐵業正經歷著巨大的變革。美國6月實施的50%關稅實際上已經使該市場對加拿大鋼鐵生產商不再具有可行性，徹底破壞了我們歷來成功的跨國商業模式。這些貿易中斷正在全球範圍內產生影響，迫使世界各地的生產商尋找替代市場，而宏觀經濟的不確定性加劇了我們行業面臨的不利因素。

Our third quarter performance was in line with our previously disclosed guidance across both shipment volumes and adjusted EBITDA metrics. As expected, we experienced lower shipment volumes and realized pricing as well as elevated cost pressures, resulting in year-over-year declines in both revenues and adjusted EBITDA.

第三季業績符合我們先前公佈的預期，無論是出貨量或調整後的 EBITDA 指標均如此。正如預期的那樣，我們的出貨量和實際價格有所下降，成本壓力也隨之上升，導致收入和調整後的 EBITDA 同比均下降。

A bright spot continues to be our fully modernized plate mill. Plate shipments totaled approximately 97,000 tonnes, roughly in line with the 103,000 tonnes in the prior quarter. Despite taking a planned two-week outage during the quarter, we expect Q4 plate production to increase sequentially as we capitalize on our position as Canada’s only discrete plate producer.

我們全面現代化的鋼板軋機仍然是一大亮點。鋼板出貨量總計約 97,000 噸，與上一季的 103,000 噸大致持平。儘管本季計劃停產兩週，但我們預計第四季度鋼板產量將環比增長，因為我們將利用自身作為加拿大唯一獨立鋼板生產商的地位。

Turning to our electric arc furnace project, the foundation of our future, I’m pleased to report continued progress since achieving first arc and first steel production in early July. Commissioning and ramp-up activities for Unit One have progressed in line with expectations.

談到我們的電弧爐項目，這是我們未來的基石，我很高興地報告，自 7 月初實現首次電弧和首次煉鋼以來，該項目持續取得進展。一號機組的調試和啟動工作進展順利，符合預期。

The furnace and associated melt shop assets have demonstrated stable and reliable performance, achieving quality metrics across a broad range of plate and hot rolled coil product grades. The Q1 power system and other critical process components continue to perform as designed, supporting consistent metallurgical quality and process control. As of September 30, 2025, cumulative investment for the EAF project was $910 million, including $30 million during the third quarter.

此熔爐及相關熔煉車間設備已展現出穩定可靠的性能，在各種板材和熱軋捲材產品等級中均達到了品質指標。Q1 電源系統和其他關鍵製程組件繼續依設計運行，支援穩定的冶金品質和製程控制。截至 2025 年 9 月 30 日，EAF 專案的累計投資額為 9.1 億美元，其中第三季投資額為 3,000 萬美元。

All material aspects of the project have been contracted and we continue to expect final aggregate cost of completion will be approximately $987 million. We have announced a number of decisive actions to strengthen our balance sheet and liquidity, including $500 million of federal and provincial loan facilities. Rather than covering each in detail, I ask Rajat to take you through the specific steps and their impact on our financial flexibility later in the call.

該項目的所有實質方面均已簽訂合同，我們仍然預計最終總完工成本約為 9.87 億美元。我們宣布一系列果斷措施來加強我們的資產負債表和流動性，包括獲得 5 億美元的聯邦和省級貸款。與其詳細講解每個步驟，不如讓 Rajat 在稍後的通話中帶您了解具體步驟及其對我們財務靈活性的影響。

This government support directly addresses the sustained tariff environment that has forced us to reimagine our operating strategy. We are accelerating retirement of our blast furnace and coke oven operations as we ramp up EAF production through 2025 and 2026. We’re strategically refocusing production on as-rolled and heat-treated plate products along with select coil products primarily for sale in the Canadian market.

政府的這項支持直接針對持續的關稅環境，迫使我們重新構想我們的營運策略。隨著我們在 2025 年和 2026 年逐步提高電弧爐產量，我們將加快高爐和焦爐的退役進程。我們正在策略性地調整生產方向，將重點放在軋製和熱處理板材產品以及精選卷材產品上，主要針對加拿大市場銷售。

We are uniquely positioned as Canada’s only discrete plate producer and this strategy aligns our production with domestic demand while reducing exposure to volatile and oversupplied coil markets. Our focus aligns with infrastructure, construction, and renewable energy growth sectors, preserving Algoma’s relevance by supporting national industrial priorities.

作為加拿大唯一一家獨立式板材生產商，我們擁有獨特的優勢，這項策略使我們的生產與國內需求保持一致，同時減少了對波動較大且供應過剩的捲材市場的風險敞口。我們的重點與基礎設施、建築和再生能源成長領域一致，透過支持國家產業優先事項來維持 Algoma 的相關性。

We remain focused on extending our liquidity runway to develop new opportunities including advancing our energy strategy and pursuing product diversification initiatives rather than competing as a commodity producer in a tariff-distorted global market, we are positioning Algoma as a premium Canadian supplier of essential steel products.

我們將繼續專注於延長流動性儲備，以開發新的機會，包括推進我們的能源策略和推行產品多元化計劃，而不是在關稅扭曲的全球市場中作為大宗商品生產商參與競爭。我們將 Algoma 定位為加拿大優質鋼鐵產品供應商。

This repositioning achieves three outcomes. We supply Canadian industries with high quality plate products needed for infrastructure, manufacturing, and defense. We create operational stability that supports continued investment aligned with Canada’s industrial needs, and we reinforce our role as a critical partner in Canada’s industrial and defense capabilities.

此次重新定位實現了三個目標。我們為加拿大各產業提供基礎設施、製造業和國防所需的高品質板材產品。我們創造了營運穩定性，支持與加拿大工業需求相符的持續投資，並鞏固了我們作為加拿大工業和國防能力關鍵合作夥伴的地位。

By concentrating on higher value specialized products, we can strengthen customer partnerships and optimize margins. Combined with government support, this strategy positions Algoma not just to withstand current conditions, but to emerge as a stronger, more focused company. In short, we are evolving from a cross-border commodity producer to a Canadian-focused steel supplier with lower cost, lower emissions, and greater resiliency. This transformation strengthens both Algoma and Canada’s industrial future.

透過專注於更高價值的專業產品，我們可以加強與客戶的合作關係，並優化利潤率。結合政府的支持，這項策略不僅使阿爾戈馬公司能夠抵禦當前的環境，而且使其成為更強大、更專注的公司。簡而言之，我們正在從一家跨境商品生產商轉型為專注於加拿大市場的鋼鐵供應商，以實現更低的成本、更低的排放和更強的韌性。這項轉型增強了阿爾戈馬公司和加拿大的工業未來。

Now I’d like to take a moment on a more personal note. As announced last evening, I will be retiring at the end of this year from Algoma Steel Group Inc., concluding what has been an extraordinary journey with Algoma. I want to congratulate Rajat Marwah on his appointment as CEO effective January 1, 2026, and Michael Moraca on his promotion to Chief Financial Officer.

現在我想稍微談談我個人的事情。正如昨晚宣布的那樣，我將於今年年底從阿爾戈馬鋼鐵集團公司退休，結束我在阿爾戈馬的非凡旅程。我謹祝賀 Rajat Marwah 於 2026 年 1 月 1 日被任命為首席執行官，並祝賀 Michael Moraca 晉升為首席財務官。

Rajat has been a trusted partner throughout our transformation. His leadership in finance, strategy, and stakeholder engagement has been instrumental in securing the foundation we’ve built together. I know Michael will bring the same discipline and strategic insight to the CFO role as he has demonstrated leading our integrated business planning and capital markets efforts.

在整個轉型過程中，Rajat 一直是我們值得信賴的合作夥伴。他在財務、策略和利害關係人參與方面的領導才能，對我們共同建立的基礎起到了至關重要的作用。我知道麥可將像他領導我們綜合業務規劃和資本市場工作時所展現的那樣，為財務長一職帶來同樣的嚴謹性和策略洞察力。

I’m proud of how far this company has come and confident that the management team under Rajat’s leadership will continue to strengthen Algoma’s position as a Canadian leader in sustainable steelmaking.

我為公司所取得的成就感到自豪，並相信在 Rajat 的領導下，管理團隊將繼續鞏固 Algoma 作為加拿大永續鋼鐵製造領域領導者的地位。

I would like to pass it over to you, Rajat, to cover the financials and for closing remarks.

接下來我將把發言權交給你，拉賈特，由你來介紹財務狀況並作總結發言。

Thanks Mike. Good morning everyone. First, I want to express my deep appreciation for Mike’s leadership. His vision and discipline have guided Algoma through one of the most significant transformations in our history. The foundation he built strategically, operationally, and culturally positions us for long-term success.

謝謝你，麥克。大家早安。首先，我要表達我對麥克領導能力的深深感激之情。他的遠見卓識和嚴謹作風引領阿爾戈馬經歷了歷史上最重大的變革之一。他在策略、營運和文化方面奠定的基礎，使我們為長期的成功做好了準備。

Talking about the results for the third quarter, adjusted EBITDA was a loss of $87.1 million. For the quarter, tariffs expense totaled $90 million, and we estimate Canadian sales prices were approximately 40% lower on account of tariffs, resulting in lower revenue of approximately $32 million. Cash used in operating activities was $117.3 million. We finished the quarter with $337 million of liquidity. We shipped 419,000 net tonnes in the quarter, a decline of 12.7% versus the prior year quarter.

談到第三季的業績，調整後的 EBITDA 虧損 8,710 萬美元。本季關稅支出總計 9,000 萬美元，我們估計由於關稅，加拿大銷售價格下降了約 40%，導致收入減少了約 3,200 萬美元。經營活動所用現金為1.173億美元。本季末，我們的流動資金為3.37億美元。本季我們出貨淨噸數為 419,000 噸，較上年同期下降 12.7%。

Lower steel shipments were the result of weakening market conditions, particularly due to Section 232 tariffs, which impacted the company’s export sales and resulted in oversupply of the Canadian market. At reduced transactional pricing, net sales realization averaged $1,129 per tonne compared to $1,036 per tonne in the prior year period. The increase versus the prior year level reflects improvements in value-added product mix as a proportion of sales, which more than offset weaker market conditions.

鋼鐵出貨量下降是由於市場狀況疲軟，特別是由於 232 條款關稅，這影響了公司的出口銷售，導致加拿大市場供應過剩。以較低的交易價格計算，淨銷售實現價平均為每噸 1,129 美元，而去年同期為每噸 1,036 美元。與去年同期相比，加值產品佔銷售額的比例有所提高，足以抵消疲軟的市場環境。

Plate prices continued to enjoy a premium relative to hot rolled coils during the quarter. This resulted in sale revenue of $473 million in the quarter, down 12.2% versus the prior year period. On the cost side, Algoma’s cost per ton of steel products sold averaged $1,282 in the quarter, up 24.2% versus the prior year period. Starting March 12, the company was subject to a 25% tariff on outbound steel shipments to the US, which increased to 50% in June.

本季鋼板價格繼續比熱軋捲板價格高出一定比例。該季度銷售收入為 4.73 億美元，比去年同期下降 12.2%。成本方面，Algoma公司本季每噸鋼鐵產品的平均銷售成本為1,282美元，較上年同期成長24.2%。從 3 月 12 日起，該公司向美國出口的鋼鐵產品需繳納 25% 的關稅，6 月關稅提高至 50%。

For the third quarter, tariffs cost were $90 million or $214 per tonne, which was included in cost of sales. Excluding the impact of tariff, cost of sales was only 3.6% higher versus the prior year period despite a 20% lower shipping volume and a higher mix of plate sales for the period.

第三季關稅成本為 9,000 萬美元，即每噸 214 美元，已計入銷售成本。剔除關稅的影響，儘管出貨量下降了 20%，且該期間板材銷售佔比更高，但銷售成本僅比上年同期高出 3.6%。

We will continue to focus and drive down the cost of sales as we make our strategic pivot to focus primarily on plate and selected coil products. Net loss in the third quarter was $485.1 million compared to a net loss of $106.6 million in the prior year quarter. The increase in net loss was driven primarily by the $503 million non-cash impairment loss as of September 30, 2025.

我們將繼續專注於降低銷售成本，同時進行策略轉型，主要集中精力於板材和精選卷材產品。第三季淨虧損為 4.851 億美元，而上年同期淨虧損為 1.066 億美元。淨虧損增加主要是由於截至 2025 年 9 月 30 日的非現金減損損失 5.03 億美元造成的。

The company identified two impairment indicators, its market capitalization falling below the carrying value of its net assets and the impact of US Section 232 tariffs. Accordingly, an impairment test was performed to assess whether the recoverable amount of the cash generating unit exceeded its carrying value, which resulted in the non-cash impairment loss.

該公司確定了兩個減損指標：市值低於淨資產帳面價值以及美國 232 條款關稅的影響。因此，進行了減損測試，以評估現金產生單元的可收回金額是否超過其帳面價值，結果導致了非現金減損損失。

Cash used in operations totaled $117 million for the quarter compared to cash generated by operations of $26 million in the prior year period. Inventories ended the quarter at $790 million, up approximately $54 million from the second quarter, reflecting a physical build in raw materials and finished goods, partially offset by a $14.8 million non-cash write down of inventories to net realizable value.

本季經營活動所用現金總額為 1.17 億美元，而上年同期經營活動產生的現金為 2,600 萬美元。本季末庫存為 7.9 億美元，比第二季增加約 5,400 萬美元，這反映了原材料和成品的實物增加，但部分被 1,480 萬美元的非現金庫存減值（減記為淨可變現價值）所抵消。

Looking ahead, we expect a significant inventory drawdown beginning in the fourth quarter and accelerating through 2026 as we exit the blast furnace and coke oven operations and transition to a far more efficient EAF-based supply chain.

展望未來，我們預計從第四季開始庫存將大幅下降，並在 2026 年加速下降，因為我們將退出高爐和焦爐業務，並過渡到效率更高的電弧爐供應鏈。

As Mike mentioned, we have announced a number of decisive actions to strengthen our balance sheet and liquidity. We increased our ABL credit facility from $300 million to $375 million with Export Development Canada joining as a new lender. More significantly, late last month we announced a binding term sheet securing $500 million in liquidity support from the Governments of Canada and Ontario. We want to thank the government for their efforts in supporting Canadian industry, and we feel this package reflects their confidence in Algoma Steel Group Inc.’s strategic importance to Canada’s industrial base.

正如麥克所提到的，我們已經宣布了一系列果斷措施，以加強我們的資產負債表和流動性。我們將資產抵押貸款額度從 3 億美元增加到 3.75 億美元，加拿大出口發展公司也將作為新的貸款方加入。更重要的是，上個月底我們宣布了一份具有約束力的條款清單，從加拿大和安大略省政府獲得了 5 億美元的流動性支持。我們要感謝政府為支持加拿大工業所做的努力，我們認為這個方案反映了他們對阿爾戈馬鋼鐵集團公司對加拿大工業基礎的戰略重要性的信心。

The financing includes $400 million from the Federal Large Enterprise Tariff Loan Facility and $100 million from the Province of Ontario, consisting of a $100 million third lien secured tranche and a $400 million unsecured tranche with 6.77 million share purchase warrants at $11.08 per share. The facility carries a seven-year term at Quora plus 200 basis points, stepping up after year three by 200 basis points annually.

此次融資包括來自聯邦大型企業關稅貸款機制的 4 億美元和來自安大略省的 1 億美元，其中包括 1 億美元的第三留置權擔保部分和 4 億美元的無擔保部分，以及 677 萬份每股 11.08 美元的股票購買權證。該融資工具的期限為七年，利率為 Quora 加 200 個基點，從第三年開始每年遞增 200 個基點。

A combination of our strategic operational pivot, liquidity support, working capital efficiency improvements, and continued effort on driving down cost is expected to extend our liquidity runway well into the future as we look to capture opportunities and diversify the business.

透過策略營運調整、流動性支援、營運資本效率提升以及持續降低成本，我們有望延長流動性支援期限，以便抓住機會並實現業務多元化。

In closing, as we look ahead, our direction is clear. Complete the EAF ramp up, pursue diversification opportunities, and continue building on the strength of our exceptional team. The past several months have brought unprecedented trade disruption, but through it all our people have maintained exemplary safety performance and advanced the commissioning of EAF Unit 1.

最後，展望未來，我們的方向很明確。完成 EAF 產能提升，尋求多元化發展機會，並持續發揮我們優秀團隊的優勢。過去幾個月帶來了前所未有的貿易中斷，但即便如此，我們的員工仍然保持了卓越的安全表現，並推進了電弧爐1號機組的調試工作。

We have taken decisive action to secure our future. The $500 million in government liquidity facilities together with our expanded $375 million ABL credit facility provide the resources and flexibility to complete this transformation with confidence. These arrangements reflect a shared commitment between Algoma Steel Group Inc. and our government partners to preserve critical domestic steel capacity and industry resilience by pivoting to become a domestically focused, high value steel producer anchored in plate and specialty products.

我們已採取果斷措施來保障我們的未來。政府提供的 5 億美元流動性融資，加上我們擴大的 3.75 億美元資產抵押貸款信貸額度，為我們充滿信心地完成這項轉型提供了資源和靈活性。這些安排體現了阿爾戈馬鋼鐵集團公司與政府合作夥伴的共同承諾，即透過轉型成為一家以國內市場為中心、以鋼板和特種產品為基礎的高價值鋼鐵生產商，來維護國內關鍵鋼鐵產能和產業韌性。

We are creating a stronger, more resilient enterprise aligned with Canada’s long term economic and defense priorities. Our accelerated EAF transition is central to that vision, positioning Algoma Steel Group Inc. as one of North America’s lowest cost and most sustainable producers.

我們正在打造一個更強大、更有韌性的企業，以符合加拿大的長期經濟和國防優先事項。我們加速電弧爐轉型是實現這一願景的核心，使 Algoma Steel Group Inc. 成為北美成本最低、最具永續性的生產商之一。

While near term trade uncertainty will remain, we are building a company that is leaner, more focused, and more competitive. When markets normalize, we expect to emerge stronger with improved margins, an advanced cost structure, and deeper alignment with national priorities. To our employees, thank you for your dedication and adaptability. To our government and financial partners, thank you for your confidence. To our shareholders and customers, thank you for your continued support as we execute this pivotal transformation.

儘管短期內貿易狀況仍存在不確定性，但我們正在打造一家更精簡、更專注、更具競爭力的公司。當市場恢復正常時，我們預計公司將變得更加強大，利潤率將有所提高，成本結構將更加先進，與國家優先事項的契合度也將更高。感謝各位員工的奉獻與適應能力。感謝政府和金融合作夥伴的信任。致我們的股東和客戶：感謝你們在我們執行這項關鍵轉型過程中給予的持續支持。

The work we are doing today is preserving and modernizing a strategic national asset and laying the foundation for enduring value creation. We remain focused, disciplined, and confident in the path ahead. Thank you very much for your continued interest in Algoma Steel Group Inc. At this point we would be happy to take your questions.

我們今天所做的工作是保護和現代化一項國家戰略資產，並為持久創造價值奠定基礎。我們將繼續保持專注、自律和對未來道路的信心。非常感謝您一直以來對阿爾戈馬鋼鐵集團的關注。現在我們很樂意回答您的問題。

Operator, please give the instructions for Q&A.

操作員，請給予問答環節的說明。

(Operator Instructions)

（操作說明）

Ian Gillies, Stifel GMP.

Ian Gillies，Stifel GMP。

In the event we remain in this tariff environment that is 50%, could you maybe just outline where you think the production profile ends up in 2026 and whether you think you can be at EBITDA break even in that scenario? I think that would be helpful.

如果關稅環境繼續維持在 50%，您能否概述一下您認為 2026 年的生產情況會如何，以及您認為在這種情況下能否實現 EBITDA 收支平衡？我覺得那樣會有幫助。

Sure. This is Mike. I’ll start and then hand it over to Rajat. Obviously our original intention was to get to full production on the EAFs at the end of 2026, initial part of 2027. Because of what’s happened to our business model with the 50% tariffs and the market dynamics, we’ve seen clearly that the right choice in front of us now is to execute a transition to full EAF production basically a year early. That’s going to give us the best ability to deal with the current environment.

當然。這是麥克。我先開始，然後交給拉賈特。顯然，我們最初的計劃是在 2026 年底或 2027 年初實現 EAF 的全面生產。由於 50% 的關稅和市場動態對我們的商業模式造成了影響，我們已經清楚地看到，擺在我們面前的正確選擇是提前一年全面過渡到電弧爐生產。這將使我們擁有應對當前環境的最佳能力。

We are accelerating and pushing on that transition as we speak and we need to execute it in the coming months and ramp up EAF as quick as possible because that will put us at the lowest cost, most flexible cost position and it matches the available business we have right now.

我們正在加速推進這項轉型，我們需要在未來幾個月內完成轉型，並儘快提高電弧爐煉鐵產能，因為這將使我們處於成本最低、最靈活的成本地位，並且符合我們目前可獲得的業務。

As far as the specifics to your question of the ramp up and where we would reach EBITDA positive or EBITDA neutral, I’ll let Rajat address that.

至於你提出的關於產能提升的具體問題，以及我們何時才能實現 EBITDA 為正或 EBITDA 為零，我將讓 Rajat 來回答這個問題。

Thanks, Mike. As Mike mentioned, now we are looking at accelerating it. Our market in the US is practically closed to us, and what remains is in Canada. We have our plate mill being the only plate producer in Canada. We are taking advantage of that and trying to ship as much plate as we can in Canada.

謝謝你，麥克。正如麥克所提到的，我們現在正在考慮加快這一進程。我們在美國市場其實已經關閉，剩下的市場只有加拿大了。我們擁有自己的鋼板軋機，是加拿大唯一的鋼板生產商。我們正利用這一點，並努力在加拿大盡可能地出口鋼板。

The market on the plate side itself is weaker. With all the projects being announced, that definitely will help the market to get stronger. From the way we look at it, for next year we will not be selling our 50% portion into the US, and we’ll be maintaining our share in Canada for plate and coil.

餐盤端的市場本身比較疲軟。隨著眾多項目的公佈，這無疑將有助於市場走強。我們認為，明年我們將不會向美國出售我們50%的份額，但我們將繼續保持我們在加拿大的板材和捲材市場份額。

From a numbers perspective, that could be as close as $1 million to $1.2 million tonnes for the year if the situation remains the way it is, without taking any upside on investments coming into Canada on the plate side, defense side, infrastructure side. That’s where we see it going.

從數位角度來看，如果情況保持不變，那麼一年下來，每噸可能接近 100 萬至 120 萬美元，這還不包括加拿大在食品、國防和基礎設施方面的投資成長。我們認為它會朝著那個方向發展。

From a better perspective, once the transition is fully complete, which probably will take three to six months after the shutdown of the blast furnace, with all the cost moving into the P&L, we see that we start getting pretty close to a better breakeven in those volumes. We will be making money on the plate side. Coil is still stretched with 50% tariff, and the market in Canada is broken from that perspective because coil is being sold at 40% lower than the CRU, which is not making money for anybody.

從更好的角度來看，一旦過渡完全完成（這可能在煉鐵爐停產後三到六個月內完成），所有成本都轉移到損益表上，我們就會發現，在這些產量下，我們開始非常接近更好的損益平衡點。我們將從餐盤端賺錢。由於 50% 的關稅，卷材仍然供不應求，從這個角度來看，加拿大的市場已經失衡，因為卷材的售價比 CRU 低 40%，這使得任何人都無法獲利。

That’s how we see it, Ian, at a very high level.

伊恩，從宏觀的層面來說，我們就是這樣看待這個問題。

That’s helpful. Just one quick one on the plate before I follow on to one other separate question. The plate production was down a little bit sequentially from Q2 to Q3. Is that just a function of reorienting demand? You expect that to maybe start rising, whether it be in Q4 or Q1 next year?

那很有幫助。在回答另一個問題之前，我先快速回答最後一個問題。從第二季到第三季度，板材產量較上季略有下降。這只是需求重新調整的結果嗎？你預計這個數字可能會開始上升，無論是在第四季還是明年第一季？

I think that’s a big part of it, Ian. Another part of it is we did have more maintenance days in the outage in the quarter. Taking the maintenance, the difference in the amount of maintenance days in the two quarters, they were roughly the same. Practically speaking, we’re running our plate mill at full production, other than the days we need to take for maintenance, and the actual mix of the different type of plate products, how much heat treat is in there will affect the total volume numbers.

伊恩，我認為這是其中一個重要原因。另一方面，本季停機維護天數也較多。考慮到維護工作，這兩季的維護天數差異大致相同。實際上，除了需要進行維護的幾天外，我們的軋板機一直滿載運轉。不同類型鋼板產品的實際混合比例，以及其中熱處理的程度，都會影響總產量。

Understood. Next question. I’m just curious what, I guess, capital infusions you’d expect to get in the next year or so as it pertains to insurance proceeds, where I believe there’s still a bit left to come, government grants. I’m just curious if there’s anything that could potentially come in on the tax side as well, just given losses incurred.

明白了。下一個問題。我只是好奇，您預計在未來一年左右的時間裡，會從保險賠償金（我相信還有一些剩餘資金）和政府撥款中獲得哪些資金注入。我只是好奇，考慮到已經發生的虧損，稅務方面是否也可能會有什麼問題。

Sure. I’ll ask Michael Moraca to take that question.

當然。我會請麥可·莫拉卡來回答這個問題。

Yeah. Hey, Ian, look, on the insurance side, we do expect somewhere between $30 million and $50 million more to come as we adjudicate through the claim. There are some other related cash flow items that you’ve hit on. We will have a significant working capital release over the next 12 months as we move to the EAF supply chain. It will be quite significant, I think, we’ll see something north of $100 million, $150 million, some in that range on the working capital side.

是的。嘿，伊恩，你看，就保險方面而言，我們預計在理賠過程中還會追加 3000 萬到 5000 萬美元的賠償。您也提到了一些其他相關的現金流項目。未來 12 個月，隨著我們向電弧爐供應鏈轉型，我們將獲得大量的營運資金釋放。我認為這將意義重大，我們將看到營運資金方面達到 1 億美元、1.5 億美元以上，部分資金將達到這個範圍。

As you alluded to, we will see some tax refunds as we really start to collect on the taxes that we paid in 2022 and have had obviously some net operating losses through the last little bit. Those are the big movers on the cash flow front.

正如您所提到的，隨著我們真正開始收回 2022 年繳納的稅款，我們將會看到一些退稅，而且顯然在過去一段時間裡，我們出現了一些淨經營虧損。這些是現金流方面的主要變動因素。

Yeah, that’s -- we see most of it coming next year, some of it in the first half, some in the second half depending upon timing. There will be a big amount of inflow that will happen both on all three fronts, big coming from working capital release as well as taxes coming in from a working capital perspective, we did mention earlier that there will be a $100 million release happening this next year as we transition to EAF.

是的，那——我們預計大部分會在明年實現，一部分會在上半年實現，一部分會在下半年實現，這取決於時間安排。屆時，所有三個方面都將有大量資金流入，其中大部分來自營運資金的釋放以及營運資金的稅收收入。我們之前提到過，隨著我們過渡到 EAF，明年將有 1 億美元的資金釋放。

We expect that to happen, more than that, because we’ll be running at lower levels. We should see, as Mike mentioned, $150 million odd of reduction from the working capital and over $100 million or so coming from taxes. Perfect.

我們預計這種情況會發生，甚至可能更糟，因為我們的營運水準會降低。正如麥克提到的那樣，我們應該會看到營運資金減少約 1.5 億美元，稅收減少約 1 億美元。完美的。

James McGarragle with RBC Capital Markets.

James McGarragle，加拿大皇家銀行資本市場公司。

Hey, thanks for having me on. Mike, wishing you all the best going forward. Rajat and Mike, congrats on the new roles. I just wanted to follow up on some of the commentary you made on cash flow. Those numbers were into 2026, I believe. Can you just give us an updated CapEx number and an updated net working capital number for what we can expect into Q4?

嘿，謝謝邀請我來。麥克，祝你未來一切順利。Rajat 和 Mike，恭喜你們榮升新職。我只是想就您之前關於現金流的一些評論補充一些內容。我相信，這些數字是到2026年的。能否提供一下第四季最新的資本支出數據和淨營運資本數據？

Sure. On the working capital side, we normally build working capital in the last quarter and it’s primarily on the inventory side. We will not see any build happening on the inventory side in the last quarter, we’ll probably see some release coming on the inventories, and there will be other movements happening between receivables and others. The big part of our change, normally quarter over quarter in the last calendar quarter, is inventories. The release that we are saying of $100 million, $150 million will include some release coming in the last quarter.

當然。在營運資金方面，我們通常在最後一個季度累積營運資金，而且主要體現在庫存方面。在最後一個季度，我們不會看到庫存方面出現任何增加，可能會出現一些庫存釋放，應收帳款和其他款項之間也會有其他變動。我們最大的變化，通常是上個日曆季度環比的變化，是庫存變化。我們所說的1億美元、1.5億美元的釋放資金將包括最後一季釋放的部分資金。

On the CapEx side, we will see the CapEx coming down as we go into next year as the blast furnace and coke batteries shut down. We normally spend around $40 million in those facilities, so that maintenance CapEx will come down and will get further optimized during next year and the year after.

在資本支出方面，隨著高爐和焦爐的關閉，明年資本支出將會下降。我們通常在這些設施上花費約 4000 萬美元，因此維護資本支出將會下降，並在明年和後年進一步優化。

Thanks for the color. Just wanted to follow up on one of the initial comments. The initial questions that were asked, you’d given previously some targets, cost scrap plus targets on the cost side with regards to the new furnace that you’re bringing on. Can you kind of give us an updated view on how you’re thinking about that scrap plus cost targets given the impact from tariffs and that you might not be running that furnace at full capacity initially? Just how we can expect that to evolve into 2026 and then how you’re thinking about those targets longer term?

謝謝你提供的色彩。我想就之前的一則評論做個補充說明。最初提出的問題，您之前已經給出了一些目標，成本廢料加上您即將引進的新爐子的成本目標。鑑於關稅的影響，以及您最初可能無法滿載運轉熔爐，您能否給我們更新您對廢料和成本目標的看法？到 2026 年，我們能預期這種情況會如何發展？您又是如何看待這些長期目標的呢？

On the cost side, what we said is that it’s scrap plus $220 roughly US for sheet products, and that will be slightly higher. It will be in the range of $220 to $250 for the initial period as we will be running the EAF at lower capacity than one EAF at full capacity. We’ll see that slightly higher, and it won’t be double, but it will be slightly higher.

成本方面，我們之前說過，板材產品的成本大約是廢料加上 220 美元，而實際成本還會略高一些。初期階段，電弧爐的運作能力將低於滿載運轉時的電弧爐，因此電弧爐的運作能力將在 220 美元到 250 美元之間。我們會看到略高一些，雖然不會翻倍，但會略高一些。

We see that coming down to around $220-odd once we are running at at least 2 million to 2.5 million tonnes. That’s how we see the change on the cost side. Plate from a conversion perspective will be very similar, just that the variable cost will be higher. You have alloys, and there is a little bit more processing that comes through.

我們預計，一旦產量達到至少 200 萬至 250 萬噸，單價將降至 220 美元左右。這就是我們對成本方面變化的看法。從轉換角度來看，餐盤將非常相似，只是變動成本會更高。你們用的是合金，還需要一些額外的加工處理。

In the current environment, do you think the Canadian market can support that 2.5 million tonnes that you think is necessary in order to achieve that cost plus target, or do you think something would have to change in terms of tariffs for the Canadian market to be able to support that 2.5 million tonnes?

在當前環境下，您認為加拿大市場能否支撐您認為為實現成本加成目標所需的 250 萬噸進口量？還是您認為加拿大市場需要改變關稅政策才能支撐這 250 萬噸進口量？

James, this is Mike. I think a critical part of the future of Algoma Steel is to be the foundation steel company for the future of the Canadian nation building agenda, if you will. We have the lowest cost, most flexible liquid steel base in the industry in Canada, or we will soon be there once the transition to EAF is complete and we’ve ramped up in the next year. I would say that market is not yet fully developed as we sit here in November, almost November of 2025.

詹姆斯，我是麥克。我認為，阿爾戈馬鋼鐵公司未來發展的關鍵在於成為加拿大國家建設議程的基礎鋼鐵公司。我們在加拿大擁有業內成本最低、最靈活的液態鋼基礎，或者一旦完成向電弧爐的過渡，並在明年提高產量，我們很快就會擁有這樣的基礎。我認為，截至2025年11月，這個市場尚未完全發展成熟。

The market continues and will continue to develop. The nation building agenda that the new government has laid out is pretty clear in terms of everything that wants to be pursued around defense projects, infrastructure projects, shipbuilding, energy, manufacturing, reshoring. This is all without a return to a somewhat normal trade relationship with the U.S.

市場持續發展，並將持續發展。新政府制定的國家建設議程非常明確，涵蓋了國防項目、基礎建設項目、造船、能源、製造業、產業回流等各個面向。這一切都發生在與美國恢復某種程度上的正常貿易關係之前。

This is all future development and evolution of the Canadian market. My answer is if all that comes to fruition and even just a portion of it comes to fruition, Algoma Steel will be far and away the most advantageous and the best positioned to take advantage of it.

這都是加拿大市場未來的發展與演變。我的答案是，如果這一切能夠實現，即使只是其中一部分能夠實現，阿爾戈馬鋼鐵公司都將是最具優勢、最能從中受益的公司。

I think the market’s going to be there for us if in the meantime or as part of that there’s a return to an improved trade relationship to the US which gives us more access to the historical US market. That will put wind in the sails of everything that we’ve talked about. It’ll open up the ability to take advantage of US business. It will lift the margin across all of our business on both sides of the border. We still believe and are committed to being a strategic part of Canada’s nation building agenda.

我認為，如果在此期間或作為其中的一部分，與美國的貿易關係有所改善，使我們能夠更多地進入美國傳統市場，那麼市場將會為我們提供服務。這將為我們討論的所有事情帶來極大的推動作用。這將使你能夠利用美國的商業機會。這將提升我們在邊境兩側所有業務的利潤率。我們仍然相信並致力於成為加拿大國家建設議程的戰略組成部分。

I don’t think it would immediately mean, certainly not for Algoma Steel, it wouldn’t mean a return of business as usual where we’re just a commodity steel supplier looking for the best business, whether it’s in the US or Canada. We would be mindful of the strategic risk of just going back to the old business model.

我不認為這會立即意味著，當然對阿爾戈馬鋼鐵公司來說，這並不意味著一切都會恢復如常，我們不再只是一家普通的鋼鐵供應商，而是在尋找最好的生意，無論是在美國還是在加拿大。我們會意識到，僅僅回到舊的商業模式會帶來策略風險。

I know it’s a little bit long-winded answer to your question, but yes, we believe in the future of the Canadian market built on the nation building agenda that the government of Canada has laid out and our unique position as Algoma Steel to take advantage of that.

我知道這個回答有點冗長，但沒錯，我們相信加拿大市場的未來，它建立在加拿大政府制定的國家建設議程之上，而我們阿爾戈馬鋼鐵公司擁有獨特的優勢，可以利用這一議程。

Ian Gillies, Stifel.

伊恩·吉利斯，斯蒂費爾。

In the Canadian market, are you seeing any positive implications yet from some of the trade barriers that have been instituted by the Canadian government? Or do they need to, I guess, do the walls need to be taken up higher.

在加拿大市場，您是否已經看到加拿大政府實施的一些貿易壁壘產生了任何正面影響？或者，我想，他們需要把牆壁建得更高一些。

Yeah, I think you know, we’ve shared our frank views with the government around opportunities we see for them to put those walls higher and put more teeth into moves that would strengthen the health of the Canadian market. Obviously, the government has a lot to think through when they hear feedback from the steel industry in terms of are there any other consequences to doing something like that which they may not see as positive.

是的，我想你知道，我們已經向政府坦誠地表達了我們認為他們有機會加高這些壁壘，並採取更有力的措施來加強加拿大市場的健康發展。顯然，政府在聽到鋼鐵業的回饋時，有很多事情需要考慮，例如這樣做是否會帶來其他一些他們可能認為並不積極的後果。

Certainly, from a steel perspective, we think that there’s more that they could do, and we’ve been very vocal about that with them. I will say what we are seeing is a tremendous amount of interest in understanding Algoma Steel Group Inc.’s capabilities, both current and potential future capabilities, from every sector of the country, every sector of the economy.

當然，從鋼鐵業的角度來看，我們認為他們還可以做得更多，我們也一直就此向他們表達過強烈的看法。我想說的是，我們看到來自全國各個領域、各個經濟部門對了解阿爾戈馬鋼鐵集團公司的能力（包括當前能力和未來潛在能力）表現出了極大的興趣。

We’ve gotten phone calls, visits, inquiries in terms of what do you make, how can you make something for my steel uses, and if you can’t make it today, what type of investment or how soon could you make it? That’s all very positive. Some of it is for business that’s actually being made right now.

我們接到了很多電話、來訪和諮詢，詢問你們生產什麼產品，如何為我的鋼鐵用途生產產品，如果今天不能生產，需要什麼樣的投資或最快什麼時候可以生產？這些都是非常正面的方面。其中一些是為目前正在進行的業務準備的。

Some of it is for future business that may be still a few years away. The visibility, the intention, and the interest in Algoma Steel Group Inc. and what role we can and will play in the future of Canada’s nation building is definitely there. We’ve already seen that for the last several months.

其中一些是為未來幾年可能還會開展的業務準備的。阿爾戈馬鋼鐵集團的知名度、意圖和興趣，以及我們未來能夠在加拿大國家建設中發揮的作用，都是毋庸置疑的。過去幾個月我們已經看到了這一點。

I suspect this question is unanswerable, but do you have any sense of what you think the incremental plate demand could be or broader steel demand could be from these initiatives? Maybe even just on projects announced or potential projects?

我懷疑這個問題無法回答，但您是否認為這些措施可能會帶來多少新增的鋼板需求，或是更廣泛的鋼鐵需求？或許只是針對已公佈的項目或潛在項目？

You’re right. It’s hard to give you a big number. I know that a lot of these, for instance, the shipbuilding. We’ve had visits from major shipbuilders who are looking at just the defense shipbuilding agenda over the next several years. We can make all the steel needed in 10 Canadian warships. We could make the amount of plate needed for those 10 ships in two days. It’s not going to be one major program which moves the needle. It’s going to be a lot of demand throughout the entire economy and all types of projects.

你說得對。很難給你一個很大的數字。我知道其中很多領域，例如造船業。我們已經接待了一些大型造船企業的來訪，他們正在考察未來幾年的國防造船計劃。我們可以生產建造10艘加拿大軍艦所需的所有鋼材。我們兩天就能產出這 10 艘船所需的鋼板數量。不會是某個大型專案就能帶來翻天覆地的改變。它將在整個經濟領域和各種類型的項目中產生很大的需求。

Certainly, defense spending and icebreakers and pipelines will get a lot of visibility, but we need multiple projects. The plate market in Canada is roughly 600,000 to 700,000 tonnes right now. We’re easily capturing 50% of that, and it’s a relatively small market.

當然，國防開支、破冰船和輸油管項目會受到很多關注，但我們需要多個項目。目前加拿大的鋼板市場需求量約為 60 萬至 70 萬噸。我們輕鬆就佔了其中 50% 的份額，而這還是一個相對較小的市場。

It doesn’t take hundreds of projects to start building that market up north of a million tonnes. It takes more than a handful, but it doesn’t take hundreds. We feel pretty bullish about the future prospects in plate, but it’s hard to give you a specific number.

要建立一個年產量超過一百萬噸的市場，並不需要數百個專案。需要的不只幾個，但也不需要幾百個。我們對板球的未來前景相當樂觀，但很難給出一個具體的數字。

Last one for me, and this is probably for Rajat, could you maybe provide a view on how you intend to start using the credit facilities as you start moving into a bit more cash burn? Given the implications, some can be picked, some have dilution, some carry interest. I think that would be useful.

最後一個問題，可能也是問 Rajat 的，您能否談談隨著現金消耗量的增加，您打算如何使用信貸額度？考慮到各種因素，有些股票可以被選中，有些股票會被稀釋，有些股票會附帶權益。我覺得這會很有用。

Sure. The way the facilities have been put together, we have a secured line which doesn’t have any warrants attached to it. The intention will be to draw that line first and then go into the unsecured line where warrants are there. That helps us to manage that. Most of it is spec for two years and people pick it, which makes sense. It goes to cash payments.

當然。由於設施的搭建方式，我們擁有了一條安全的線路，這條線路沒有任何附加搜索令。我們的目標是先劃定這條界線，然後再進入有擔保的無擔保領域。這有助於我們管理這件事。大部分內容都是兩年的規格說明，人們會選擇它，這很合理。全部轉為現金支付。

From use perspective, we have the ABL, which we want to keep as much as possible from working capital, another perspective, and start using the other line. We will be looking at it as we draw on what’s the most and the best optimum use of cash is and which cash, and based on our plan for next year, keep drawing. We’ll be quite mindful of how we are drawing it from that perspective.

從使用角度來看，我們有 ABL，我們希望盡可能地將其保留在營運資金中；從另一個角度來看，我們開始使用另一條線路。我們將仔細研究如何最有效地利用現金，以及應該使用哪些現金，並根據我們明年的計劃繼續提取。我們會非常注意從這個角度來繪製它。

There are no further questions at this time. I would like to turn the floor back to Michael Moraca for closing remarks.

目前沒有其他問題了。現在我把發言權交還給麥可·莫拉卡，請他作總結發言。

Thank you again for your participation in our third quarter 2025 earnings conference call and your continued interest in Algoma Steel Group Inc. We look forward to updating you on our results and progress when we report our fourth quarter and full year results early next year. Thank you.

再次感謝您參加我們2025年第三季財報電話會議，並感謝您對Algoma Steel Group Inc.的持續關注。我們期待在明年初公佈第四季和全年業績時，向您報告我們的業績和進展。謝謝。

That does conclude today’s teleconference. We thank you for your participation. You may now disconnect your lines at this time.

今天的電話會議到此結束。感謝您的參與。現在您可以斷開線路了。