Business
Stelco reports first quarter results
Stelco reports first quarter results.
About this update from Starr Peak Mining Ltd
[{"type":"text","content":"\n\n\n\nHAMILTON, ON, April 30 /CNW/ - Stelco Inc. (TSX:STE) ("Stelco" or the\n"Corporation") today reported EBITDA(x) of $13 million and a loss before income\ntax of $35 million for the first quarter ended March 31, 2007, a substantial\nimprovement over the negative $82 million EBITDA(x) and $145 million loss before\nincome tax reported in the fourth quarter 2006.\n\n\n First Quarter Highlights\n\n- Lake Erie Steel achieved a record monthly production during the\n quarter following its successful expansion.\n\n- Shipments increased to 922,000 tons and semi-finished steel production\n increased to 1,100,000 tons.\n\n- Net sales revenue for the quarter ended March 31, 2007 was\n $609 million compared to $472 million for the quarter ended\n December 31, 2006.\n\n- The Corporation's capital structure has been enhanced - the\n Corporation's asset based revolving credit facility was amended on\n enhanced terms and maturity extended to 2012, and subsequent to the\n quarter end a commitment letter was entered into to replace the\n existing revolving term loan credit facility on more favourable terms.\n\n\nOperations\n\n\nHamilton Steel continued to incur significant losses during the first\nquarter, offsetting the profitability of Lake Erie Steel and HLE Mining. As\npreviously disclosed, the 56" hot strip mill at Hamilton Steel, which has\noperated since 1937, will be closed in May 2007 due to its high cost of\nproduction and limited support from the marketplace. The 56" mill closure is\nexpected to reduce employment levels by 350 people at Hamilton, and is a\nsignificant step toward transforming Hamilton Steel to become a profitable\nsteel manufacturer. The expanded capacity at Lake Erie Steel, in combination\nwith the reduction in fixed costs at Hamilton Steel, is expected to improve\nStelco's overall efficiency, product quality, and operating costs.\n\n\nCommenting on the results, Stelco's President and Chief Executive\nOfficer, Mr. Rodney Mott stated, "We have positioned Stelco to react quickly\nto the changing marketplace. Our ramp up in production and shipments following\nour Lake Erie expansion and Hamilton blast furnace upgrade has been\noutstanding."\n\n\nFinancing\n\n\nThe Corporation amended and extended its $600 million asset based\nrevolving credit facility on March 23, 2007. These a...