Canada-based steelmaker Algoma Steel Group Inc. has provided guidance for its second quarter ended June 30, 2026, projecting total steel shipments in the range of 175,000 to 180,000 tons and adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) in the range of CAD$5 million to CAD$15 million.
The adjusted EBITDA guidance includes two significant one time benefits. First, a final insurance settlement of CAD$45 million related to a coke making utility corridor incident in January 2024, and second an expected capacity utilization adjustment benefit of approximately CAD$50 million to CAD$55 million. Together these two items account for CAD$95 million to CAD$100 million of the reported EBITDA figure. Without them, underlying operational results for the quarter would be deeply negative, reflecting the continued pressure from broader market conditions and tariff headwinds the company has been navigating.
Despite the difficult market backdrop, the company reported record plate sales during the quarter and said its first electric arc furnace (EAF) unit continued to ramp up as expected. Algoma expects to bring its second EAF unit online in the second half of 2026, completing its transition away from traditional blast furnace steelmaking. The company said it is making progress on a pivot to a more Canada-centric sales strategy and described the recent rise in steel prices as encouraging.
The EAF transition is supported over the long term by Ontario's clean electricity grid. Algoma has described the transformation as one of the largest industrial decarbonization initiatives in North America, with carbon emissions expected to be reduced by approximately 70 percent once the transition is complete.
Alongside the EAF transition, Algoma has introduced Volta, a new brand for steel produced through its EAF technology. The company says Volta delivers the same performance specifications customers expect while carrying a significantly lower emissions profile, produced in Canada.
Rajat Marwah, Algoma's chief executive officer, said, "The second quarter of 2026 demonstrated the continued resilience of our transformed business, with record plate sales and our first electric arc furnace unit continuing to ramp up as expected, even as broader market conditions continued to weigh on total shipment volume.” He continued, “As Canada's only producer of discrete plate, we remain well-positioned to serve growing infrastructure, construction, and defense demand."