Algoma reports quarter one profits
Canadian steelmaker Algoma Steel reported quadruple profits of CA$89.1 million (US$71.4 million) on sales of CA$499 million during quarter one 2005. Algomas earnings for the quarter ended March 31, 2005, translated into year-on-year profit and sales increases of CA$67 million and CA$162 million respectively. Much of Algomas dramatic profit turnaround can be attributed to their consumption of iron ore purchased at 2004 prices. Results are expected to dip dramatically by the third quarter as raw materials purchased at 2005 prices which in some cases are 85% higher factor into the picture. Meanwhile, the steel company is expected to announce in the next couple months whether it will be sold. At an annual meeting held on Wednesday, CEO Denis Turcotte told shareholders that several financial buyers as well as steelmakers have expressed interest in buying the company. He also urged patience on a decision about whether the company will pay out a special dividend. Algoma has sought bankruptcy protection twice and has gone through restructuring with the help of the Ontario government. Once buried under a deluge of debt, the company now ranks behind fellow Canadian steelmakers Stelco and Dofasco in size, having generated CA$1.8 billion. CA$1 = US$0.801477