Steel Mills
Stelco Records Highest Ever Quarterly Profit in Q3
Written by Michael Cowden
November 10, 2021
Canadian flat-rolled steelmaker Stelco posted the highest quarterly profits in its history in the third quarter on strong demand, high prices and increased shipment volumes.
And the Hamilton, Ontario-based company predicted that the momentum would roll into the fourth quarter too.
“Once again, our business has demonstrated our ability to take full advantage of strong market conditions and deliver record results for our shareholders,” Stelco Chairman and CEO Alan Kestenbaum said in a statement released with third-quarter earnings data after the close of markets on Wednesday.
Stelco, an integrated steelmaker, posted third-quarter net income of Canadian $214 million ($171.3 million) after losing C$88 million ($70.5 million) in the third quarter of last year on revenue that increased 471% to C$1.35 billion ($1.08 billion) over the same period.
Average selling prices were C$1,808 ($1,448) per ton in the third quarter of this year, up 165% from C$683 ($547) per ton in the third quarter of 2020.
Shipments were 710,000 tons in the third quarter of 2021, up 113% from 334,000 tons in the year-ago quarter. Of those 710,000 tons shipped, 76% (542,000 tons) were hot rolled, 17% (123,000 tons) were coated products, 2% (11,00 tons) were cold rolled, and 5% (34,000 tons) were “other” steel products – namely, pig iron, slabs or non-prime steel.
On the operations side, Stelco expects to “substantially complete” an upgrade to the coke batteries at its Lake Erie Works in Nanticoke, Ontario, Kestenbaum said.
The company in addition plans to finish a 65MV electricity cogeneration project in the first half of 2022. “With rising electricity costs around the world increasingly impacting everyone and especially our electricity-dependent competitors, we expect to receive even more significant benefits than originally planned from this asset,” he said.
Higher energy prices have led to inflation abroad.
By Michael Cowden, Michael@SteelMarketUpdate.com
Michael Cowden
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