Algoma Steel Group Inc.

Hello, and welcome to today's conference call to discuss Algoma Steel's fiscal third quarter 2023 financial results. My name is Shamali, and I'm your operator for today's call. At this time, I'd like to hand the call over to Mike Maraca, Treasurer and Investor Relations Officer for Algoma. Mr. Maraca, please go ahead.

Good morning, everyone, and welcome to Algoma Steel Group, Inc.' 's financial and operating results conference call for the fiscal third quarter ended December 31st, 2022. Leading today's call are Michael Garcia, our Chief Executive Officer, and Rajit Marwa, our Chief Financial Officer. As a reminder, this call is being recorded and will be made available for replay later today in the Investors section of Algoma Steel's corporate website at www.algoma.com. I would like to remind you that comments made on today's call may contain forward-looking statements within the meaning of applicable securities laws, which involve assumptions and inherent risks and uncertainties. Actual results may differ materially from statements made today. In addition, our financial statements are prepared in accordance with IFRS, which differs from US GAAP, and our discussion today includes references to certain non-IFRS financial measures. Last evening, we posted a presentation on our financial and operating results to accompany today's prepared remarks. The slides for today's call can be found in the Investors section of our corporate websites. With that in mind, I would ask everyone on the call to read the legal disclaimers on slide two of the accompanying presentation and to also refer to the risks and assumptions outlined in Algoma Steel's financial statements and management's discussion analysis for the full year ended March 31st, 2022. Please note that our financial statements are prepared using the U.S. dollar as our functional currency and the Canadian dollar as our presentation currency. Our fiscal year runs from April 1st to March 31st and our third quarter financial statements have been prepared for the three months ended December 31st, 2022. Please note all amounts referred to on today's call are in Canadian dollars unless otherwise noted. Following our prepared remarks, we'll open the call to conduct a question and answer session. I will now turn the call over to our Chief Executive Officer, Michael Garcia. Mike.

Thank you, Mike. Good morning and thank you for joining us today. As we always do, I would like to begin my remarks by addressing Algoma's top priority, which is the safety of our employees. At Algoma, safety is non-negotiable and is firmly rooted in our corporate values, where with every decision, every action, and every day, we will work safely with teamwork, integrity, and a deep care for our people, their families, and the environment. Our continued dedication has led to a significant improvement in our lost time injury frequency rate, over the past decade. We will continue to work diligently as we relentlessly pursue our goal of achieving zero workplace injuries. Next, I'll cover key events and milestones during our fiscal third quarter and subsequent to its end. I will then turn the call over to Rajat for a deeper dive into the numbers before closing with an update on market conditions and our strategic investments set to deliver long-term value for all of our stakeholders. Our performance in the third quarter was largely in line with our pre-announcement on January 9th, 2023. Shipments of 458,000 tons were sequentially higher, though still below our normal run rate as we completed commissioning of our plate mill modernization phase one. Our overall financial results also reflected lower pricing in the third quarter. Steel prices for hot rolled coil have recovered meaningfully since early November and plate pricing has maintained a significant price premium. While commissioning of the plate mill modernization phase one was a challenge in the second half of calendar 2022, it's important to highlight the reasons for the project and the value delivered from it. Our plate mill is the only discrete plate mill in Canada, and it produces a full range of high-quality rolled and heat-treated plate products. including the widest plate manufactured in Canada. Our products can be tailored for high-strength abrasion resistance and military applications, among a wide range of other end uses. Completion of Phase I will now deliver enhanced capabilities, including improved surface quality and shape. Importantly, plate shipments return to normalized levels by the end of the third quarter, and we expect shipments in calendar 2023 to be consistent with historical production levels. The next phase of our plate mill modernization project, phase two, will focus on increasing mill throughput and is expected later in 2023. As we outlined on our last quarterly call, we will be mindful of market conditions before commencing phase two, and we will be laser focused on utilizing lessons learned from phase one in its implementation. Looking forward on the cost side, we expect a quarter-over-quarter improvement on cost of goods sold per ton as we return to normal production levels. It should be noted that we continue to experience some headwinds on account of higher-priced purchased coke. Our demand for coke at the blast furnace outstrips our production capacity, requiring us to supplement with purchased coke. In an effort to mitigate this, we are focused on operational improvement initiatives at our coke-making facilities to increase throughput. We anticipate to complete these improvements over the next few months, providing additional internal coke production by the end of fiscal Q1 2024. As previously disclosed, we have a long-term contract with a third-party coke producer, which provides us with the coke needed to maintain still production at normalized levels. The fiscal third quarter was also characterized by a volatile market for steel and raw material inputs, which continued to impact realized prices and costs. Pricing reached 2022 lows in early November before recovering through the end of the quarter and into 2023. During the quarter, we continued to advance construction of our transformative electric arc furnace project, which remains on budget and on time for our planned mid-2024 startup. Piling and foundational work is largely complete. Cranes are in position, and the first structural steel components are being raised as we speak, an exciting milestone in the project. On the capital allocation side, we declared our regular quarterly dividend of US $0.05 per share, and we remained active under our normal course issuer bid program. Now I will pass the call over to Rajat to go over the financial results of the third quarter. Rajat?