Algoma Steel's credit rating has been given an upgrade by New York-based credit rating service, Moody's Investors Service.
In a press release issued today, the Sault steelmaker's rating was moved to a 'Stable Outlook,' reflecting improvement in operating performance due to higher steel prices and investments in the manufacturing process.
The full statement from Algoma Steel reads as follows:
Algoma Steel Inc. (“ASI”), a leading North American supplier of value-added steel sheet and plate products, announces that Moody's Investors Service ("Moody's") upgraded ASI’s rating to B3/Stable Outlook, as of Jan. 19, 2021.
In its Rating Action, Jamie Koutsoukis, Moody's Vice President, Senior Analyst, commented, "The upgrade of Algoma's ratings reflect an improvement in operating performance and credit metrics due to higher steel prices and the expectation that the company will generate positive free cash flow."
Regarding the Moody’s upgrade, Michael McQuade, Chief Executive Officer of Algoma Steel, commented, “We executed extremely well in a challenging environment, steadily driving cost reductions and productivity improvements while making critical investments in our manufacturing processes, evidenced most recently by the start-up of our No.2 Ladle Metallurgy Furnace. Together with long-term competitively priced iron ore supply agreements, these initiatives are positioning Algoma to further benefit from a strong North American steel pricing environment and robust market demand.”
Algoma Steel continues to pursue performance enhancements and targeted allocation of capital to drive improved profitability and cash generation.
Michael McQuade added, “The dedication and sustained efforts of Algoma employees in continuing to identify and implement performance improvement initiatives are contributing significantly to our success.”