Algoma Steel Group Inc. · NASDAQ:ASTL
Algoma Steel — Investor Presentation (2024)
43 slides from Algoma Steel's investor presentation, 2024
Slide 1: Investor Presentation Fall 2024
ee SS LL ALGOMA — STEEL INC. — Investor Presentation Fall 2024
Slide 2: Disclaimer
Disclaimer CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS This presentation contains “forward-looking information” under applicable Canadian securities legislation and "forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 (collectivel
Slide 3: Investment Highlights and Today's Presenters
Investment Highlights Today's Presenters Premier Canadian Steel Producer and one of the Leading Flat Steel Producers in North America. Michael D. Garcia, Chief Executive Officer Generated $2.8B of EBITDA and over $2B of free Cash flow over the past 5 years. Transitioning to Electric Arc Furnace tech
Slide 4: Premier Canadian Steel Producer
Premier Canadian Steel Producer > Leading North American Flat-Rolled Producer Located in the Great Lakes Region in Sault Ste. Marie, Ontario. clan cites matac NomTHsHoRE aa TILDEN a co UNITED. I TACONITE KEETAC\ cures USsTEEL HIBBING Eievelan ccures(65.39%) user 47) DETROIT cHICAGO @ Iron Ore Mines
Slide 5: Premier Canadian Steel Producer
Premier Canadian Steel Producer > Raw steel capacity of 2.8mm tons (with incremental 0.9mm tons from idled blast furnace capacity) per year. > Broad range of high-quality finished sheet and plate steel for automotive, construction, energy, infrastructure and manufacturing end markets. > Expanded cap
Slide 6: EAF Conversion Project: A Generational Investment
EAF Conversion Project: A Generational Investment Unlocking Significant Value Expected Benefits of EAF > ~Adds ~700kt of finished steel capacity aligning steelmaking capacity to rolling capacity. > Reduced conversion cost and expanded margins expected to increase EBITDA by approx. $150M per annum. >
Slide 7: EAF Compared to Blast Furnace Steelmaking
MATERIALS: RAW MATERIALS PREPARATION IRONMAKING STEELMAKING Coal Coke Ovens Iron Ore — 2 - is g alle CAPACITY < Limestone eS z a Blast Furnace Basic Oxygen ie C) Furnace (BOF) 5 (4) a EAF Compared to Blast Furnace NS Steel ma ki ng Scrap Metal & 4 Sao Metallic Units 6 CAPACITY Electricity - Ontario
Slide 8: Significantly De-Risked EAF Execution
(A Z “ a, eet Significantly De-Risked EAF Execution & 1. Balance Sheet Strength 2 —s.2. Construction On Track Gol) 3. Secure Supply of Metallics 4. Secure Supply of Energy
Slide 9: 1. Balance Sheet Strength
1. Balance Sheet Strength a2 > Algoma is in a strong financial position to manage market volatility $33M SIF $343M ABL AVAILABLE $828M Total Liquidity (as at September 30, 2024) 9 INVESTOR PRESENTATION ALGOMA — STEEL INC. —
Slide 10: 2. Construction On Track
2. Construction On Track > #2 EAF Operating Floor Structural Steel: 100% complete > EAF Substation: 100% Complete > Utility Room #1 Structural Steel: 100% Complete > Steel Reline Station: 100% Complete > Melt Shop Roofing: 90% Complete > EAF #2 Tilt Table and Shell Assembly: 90% Complete $870M $672M
Slide 11: 3. Secure Supply of Metallics
3. Secure Supply of Metallics > Joint Venture with Triple M Metals: Strengthening Algoma Steel's access to high-quality scrap. > Geographic Proximity to Significant Scrap Trade Flows: Leveraging our strategic location near major scrap sources. > Prime Scrap Access from the Great Lakes Industrial Reg
Slide 12: 4. Secure Supply of Energy
4. Secure Supply of Energy > In June 2023 new turbines were installed to support power generation for the EAF project. > EAF 115KV substation electrical infrastructure is energized and in operation. > Danieli Q-One power system being installed. +> PUC Transmission and Hydro One Sault Ste. Marie have
Slide 13: Construction Update
Construction Update! ‘Photos taken October 15, 2024. Danieli Q-One power systems
Slide 14: EAF Construction Progress
Cubic Metres Tonnes of Shell Reline of Concrete Structural Steel Foundations Dust Hood EAF Substation Meltshop Roofing #2 EAF Operation Utility Room #1 – Utility Room #2 Floor - Structural Steel Structural Steel Electrical - Transformers Utility Room #2 Concrete poured on Concrete poured on Electric
Slide 15: Powering Algoma's Transformation
Powering Algoma’s Transformation PHASE 1 PHASE 2 2025-2026E 2026-2028E yam>) yae>) POWER oo aft CONFIGURATION Lake Superior Power Existing 11SKV Lake Superior Existing 11SKV Local 230KV (LsP) (110MW) Transmission (150MW) Power(LSP)(1IOMV) Transmission ‘Transmission. (1s50mw) (0-300MV) SS ale && (rom
Slide 16: De-Risked Transition and Ramp-Up Plan
Direct Strip Production Complex BOF ; Slab Caster ®) Plate and Strip Hot Mill q LMF #1 EAF Steel Flow EAFs (Under Construction) De-Risked Transition and Ramp-Up Plan Integrated Steel Making - Today > Operating primary facilities including Coke Making, Blast Furnace #7, Basic Oxygen Furnace while con
Slide 17: Plate Mill Modernization Update
INVESTOR PRESENTATION Plate Mill Modernization Update PRIMARY AND MILL DESCALERS Algoma Steel's new Primary Descaler improves surface quality by eliminating primary furnace scale before rolling. It incorporates cutting-edge nozzle design, maximizes water impact force, boasts a height-adjustable top
Slide 18: Algoma's Path to Higher Plate Production
Algoma’s Path to Higher Plate Production Plate 1 - Quality Focus > New Primary De-scaler (improves surface quality) > Automated Surface Inspection System, detects and maps quality > New Hot Leveler (improves flatness) > Automation Upgrade of the 166 Mill (expands grade offering) Phase 2 - Productivi
Slide 19: Total Investment in Last 5 Years
EAF LMF2 Plate Mill Modernization DSPC Upgrades Total Investment in Last 5 Years
Slide 20: Building Better Lives and a Greener Future
ALGOMA — STEEL INC. —— Builing Better Lives and a Greener Future Safety ° Teamwork ¢ Integrity ° Caring With every decision, every action, every day, we will work safely with teamwork, integrity and deep care for our people, their families and the environment. WWW.ALGOMA.COM
Slide 21: Supplemental Materials
a Supplemental Materials
Slide 22: F2025 YTD F2024 F2023
F2025 YTD F2024 F2023 F2022 F2021 F2020 F2019 F2018 F2017 F2016 F2015 F2014 F2013 F2012 F2011 F2010 1.40 1.20 1.00 0.80 0.60 0.40 0.20 0.00
Slide 23: Shipments, Steel Revenue, Adjusted EBITDA
Shipments Steel Revenue Adjusted EBIDTA Adjusted EBIDTA Margin
Slide 24: Working Capital Components
Q1 F2022 Q2 F2022 Q3 F2022 Q4 F2022 Q1 F2023 Accounts Payable (net of prepaids) Q2 F2023 Q3 F2023 Q4 F2023 Accounts Receivable Inventory Q1 F2024 Q2 F2024 Q3 F2024 Taxes Payable (net) Q4 F2024 Q1 F2025 Q2 F2025
Slide 25: Steel Price Chart
$/NT $- $1,000 $1,500 $2,500 $2,000 $500 11/4/2020 1/27/2021 4/21/2021 7/14/2021 10/6/2021 12/29/2021 ARP 3/23/2022 6/15/2022 9/7/2022 11/30/2022 2/22/2023 5/17/2023 8/9/2023 HRC 11/1/2023 1/24/2024 4/17/2024 7/10/2024 10/2/2022
Slide 26: Strategic Direction
STRATEGIC DIRECTION Received Board Enhancing quality Installation of new Construction Commissioning Heavy Final installation of key Algoma has developed and Debottlenecks approval to begin and expanding grade turbines to support progresses on Gauge Inline Shear. elements substantially executed numer
Slide 27: Our 2024 ESG Report
Our 2024 ESG Report Algoma Steel is proud to present its 2024 ESG Report. The report sets out Algoma’s ESG strategy and approach to mitigating ESG risks and capturing ESG opportunities and provides an update on the Company’s ESG performance. Now available on our website at www.algoma.com
Slide 28: Social Updates
Social Updates For more updates follow our social channels: jn X Algoma Steel Inc. @ omaS I ee bigoma Steel inc. & We've successfully installed the Fume Treatment Plant stacks for our EAFs! Ryene ke San Standing at 230' tall, these stacks are engineered to release filtered air I through an efficient
Slide 29: Sustainable Corporate Citizenship
Algoma Remains Committed to Sustainable Corporate Citizenship Environment > Algoma has a demonstrated commitment to environmental stewardship and is ISO 14401 certified. > Published a Health, Safety and Environment Policy with a focus on continuous improvement. 5 Key Areas of Commitment to the Envir
Slide 30: Community Involvement
Community Involvement > As the largest employer in Sault Ste. Marie, Algoma Steel is an active responsible stakeholder and is actively involved in advancing and preserving the quality of life in the community. > Long history of charitable giving and corporate partnerships. v 50-year partnership with
Slide 31: Scrap Metallics Mix
No 1 HMS Shredded Plate & Structural Other Prime Metallics No 1 HMS Shredded Plate & Structural Other Prime Metallics
Slide 32: Metallics Pricing
Hot Metal / HBI / Pig Iron No. 1 Bundles / Bushelling (Benchmark Scrap) PC Can / Rail Shredded Plate & Structural / No. 1 HMS 0.000 0.050 0.100 0.150 0.200 0.250 0.300
Slide 33: Customers and Imports
Algoma Imports - U.S. Imports - RoW Algoma Imports - Total Customer A Customer B Customer C Direct Auto Sales Identified Sales Opportunities
Slide 34: Product Mix and Recent Initiatives
% NSR of CRU Index (3,700kt) ends (0t Rolled Coi Entire System will be 2 EAFs + Vacuum Cold Rolled Close Replaced by 2 EAFs Degassing (Liquid Stee!) Anneal (2) — Hot Rolled Pickled —_—____] Finishing & Oiled Direct Strip (temper, Production recoiling : se eau aad ot Role 95:100% (upgraded) cut-to le
Slide 35: High-Quality Products and Diversified Blue Chip Customer Base
High-Quality Products and Diversified Blue Chip Customer Base in Attractive End Markets > Product width and strength flexibility allows Algoma to serve > R&D investments support higher quality, lower cost products a broad customer base across various end markets. and drive value proposition for cust
Slide 36: DSPC Line Offers Structural Cost Advantage
DSPC Line Offers ~C$30-$40/NT Structural Conversion Cost Advantage Over BOF Peers Key Highlights > Algoma is the only integrated steel producer to operate a DSPC line, which converts liquid steel directly into coil. Algoma believes the DSPC would facilitate a seamless transition to the proposed EAFs
Slide 37: EAF Transition Improves Environmental Footprint
EAF Transition Expected to Materially Improve Algoma’s Environmental Footprint Environmental Strategy Reduction % Reduction > EAF production would unlock significant environmental benefits — EAF steelmaking generates substantially less 3.0mm tonnes 70% CO, and other air pollutants compared to Blast
Slide 38: Annex: Steel Revenue and Cost of Sales
Annex: Steel Revenue and Cost of Sales Three months ended Six months ended September 30, September 30, 2024 2023 2024 2023 tons Steel Shipments + 5.2% 520,443 548,998 4 8.5% 1,023,595 1,118,431 millions of dollars Revenue + 18.1% C$ 600.3 CS 7326 4 19.8% C$ 1,250.8 C$ 1,559.8 Less: Freight included
Slide 39: Annex: Adjusted EBITDA Reconciliation
Annex: Adjusted EBITDA Reconciliation Three months ended Six months ended September 30, September 30, millions of dollars 2024 2023 2024 2023 Net (loss) income cs (106.6) CS 34.1 C$ (100.5) CS 162.0 Depreciation of property, plant and equipment and amortization of intangible assets 36.3 25.3 69.5 48
Slide 40: Annex: Selected Quarterly Information
Annex: Selected Quarterly Information (milione of dollars, except where othemnise noted) 2025 2028 2023 AS at and for the three months ended! a2 a as a3 a2 a Os a3 2 [Financial results [Total revenue Ics 00.3CS eH.EICS EMECS EI4CS §«7AZECS «BZLACS «ETT4CS ETECS | (BB92I ‘Steel products 539.0 57.4 58
Slide 41: Glossary
Glossary Basic Oxygen Vessel used to convert liquid hot metal from a blast furnace Furnace (BOF) into steel. Blast Furnace (BF) Metallurgical furnace combining fuel, ores and flux to smelt iron ore to produce pig iron, which is fed downstream into a BOF. Cogeneration Also known as combined heat and
Slide 42: Glossary (continued)
Hot Rolled Sheet Iron Ore Pellets Limestone Ladle Metallurgy Furnace (LMF) Metallics NOx Net Sales Realization (NSR) Pig Iron Plate Prime Scrap Slab Service Center SOx Carbon steel product commonly used for applications in which dimensional tolerances and surface finish quality is not critical (e.g.
Slide 43: Building Better Lives and a Greener Future
ALGOMA — STEEL INC. —— Building Better Lives and a Greener Fature WWW.ALGOMA.COM