ASTL - Algoma Steel rises despite quarterly loss as CEO sees production recovery

Algoma Steel ( NASDAQ: ASTL ) +3.1% in Tuesday's trading after reporting a lighter than expected FQ3 loss and stronger than forecast revenues while also saying production levels and shipments are returning to normal.

Algoma ( ASTL ) said it swung to a Q3 net loss of C$69.8M, or C$0.64/share, from a profit of C$123M, or C$0.92/share, in the year-earlier quarter, and revenues fell 46% to C$567.8M from C$1.06B a year ago.

Q3 shipments slid 17% Y/Y to 458,341 tons, and the average realized price for its steel, net of freight and non-steel revenue, fell 39% Y/Y due mainly to weakening market conditions, while the cost per ton of steel products sold jumped 22%.

"We believe the challenges experienced over the prior quarters are now largely behind us, and our facilities are returning to normal production levels," CEO Michael Garcia said.

The CEO said the company's Q3 shipments were in line with expectations, with an encouraging recent rebound in North American hot rolled coil steel prices and continued strength in plate pricing.

Algoma's ( ASTL ) stated return to normal "will be a positive catalyst for the stock and will put a further bid into it in the weeks ahead," Bloomberg reported.

Algoma Steel ( ASTL ) shares have gained 33% so far this year but fell 8% during the past year .

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