Algoma and Harris Steel report Q1 fiscal results

Two Canadian steel manufacturers, Algoma Steel and Harris Steel group, released financial results for the first quarter of 2006 Thursday. Toronto-based long product manufacturer Harris Steel reported very strong fiscal results, which the company attributes to strong demand for rebar in the first quarter. The company reported Q1 '06 net earnings of Canadian (CA)$14.7 million (US$13.2 million), or CA$0.55 per share, compared to CA$12.1 million, or CA$0.45 per share, earned in the same period of last year. Net sales rose to CA$305.3 million from CA$192.7 million earned in Q1 '05. "The financial performance in the first quarter demonstrates robust rebar activity and steel trading and distribution earnings that are well above historical returns in these businesses, although we are experiencing continuing margin pressure in the industrial products segment," the company said of its results in a statement. Sault Ste. Marie, Ontario-based flat rolled producer Algoma Steel did not have as much luck in the first quarter, reporting a 63 percent drop in profit from the previous year. Algoma reported a Q1 '06 net profit of CA$32.7 million (US$29.5 million), or CA$0.84 per share, compared to a profit of CA$89.1 million earned in Q1 '05. Net sales were slightly up to CA$499.6 million, from CA$499 million the previous year. The company cited weaker steel prices and higher raw material costs as the reasons for the drop in profit. Looking forward, the company says that it expects shipments of over 600'000 nt in the second quarter at higher selling prices.