Dofasco issues third quarter earnings advisory

HAMILTON, ON, Sept. 14 /CNW/ - Dofasco Inc. announced today that it
expects its consolidated earnings for the third quarter of 2005 to be
significantly lower than the range of estimates published by investment firms
which cover the company.
Current analyst estimates of Dofasco's consolidated third quarter
earnings range from $0.54 to $1.21 per common share. Based on current market
conditions and the company's outlook for the remainder of the quarter, Dofasco
anticipates earnings to be well below the surveyed analyst range.
In its second quarter earnings release, Dofasco provided guidance that
third quarter earnings would be significantly lower than the results achieved
in the second quarter. For the first two months of the third quarter, revenue
from Hamilton operations has decreased significantly, driven by lower spot
pricing and the negative impact of the stronger Canadian dollar. In addition,
shipments for the quarter-to-date were below the company's previous
expectations due to continued customer inventory draw down and lower
production levels resulting from some short-term operating interruptions which
have been resolved. Cost per ton is now expected to be higher than in the
second quarter because of the lower production levels and the increased usage
of purchased slabs which were bought at the peak of the market. The current
expectation is that Hamilton will post a small loss for the quarter. At
Gallatin, our previous guidance for a lower third quarter remains the same.
Quebec Cartier Mining (QCM) is operating at the level anticipated at the
time of acquisition, and cash flow is in line with forecasts. However, the
process of allocating the purchase price to QCM's assets and liabilities for
accounting purposes is currently expected to result in Dofasco's earnings per
share being positively impacted by QCM's earnings for approximately four weeks
as compared to the six week period originally estimated.
Dofasco's President and CEO Don Pether said, "We are seeing positive
indications looking forward on market pricing and have been making a concerted
effort to mitigate pressures on the cost side. Under these conditions, we
expect improvement in the fourth quarter."
No further comment on the company's earnings will be made until the
release of Dofasco's third quarter results on Monday, October 31, 2005 at 9:00
a.m. Following the release, an analysts' meeting and conference call will be
hosted at the Toronto Stock Exchange at 11:00 a.m. on October 31, 2005 and
will be broadcast live on the internet from the Investors section of the
company's website at www.dofasco.ca.
Dofasco is a leading North American steel solutions provider. Product
lines include hot rolled, cold rolled, galvanized, Extragal(TM), Galvalume(TM)
and tinplate flat rolled steels, as well as tubular products, laser-welded
blanks and Zyplex(TM), a proprietary laminate. Dofasco's wide range of steel
products is sold to customers in the automotive, construction, energy,
manufacturing, pipe and tube, appliance, packaging and steel distribution
industries.

This News Release contains forward-looking information with respect to
Dofasco's operations and future financial results. Actual results may differ
from expected results for a variety of reasons including the factors discussed
in the Management's Discussion and Analysis section of Dofasco's 2004 Annual
Report and the Quarterly Reports to Shareholders for the periods ended March
31, 2005 and June 30, 2005. This News Release has been reviewed by the Audit
Committee of Dofasco's Board of Directors.