The company is in a severe transitional downturn with massive operational losses and tariff headwinds. Monitor sequential improvement in EAF ramp-up and capacity utilization charge reduction as guided for Q4 elimination. The $553M liquidity provides a near-term cushion but continued losses could pressure covenants. Watch for resolution of US Section 232 tariffs and potential defence contract wins (Roshel, Hanwha) as inflection catalysts.
Price Chart
Executive Summary
Algoma Steel reported a severe Q1 2026 with revenue plunging 42.6% to $296.9M and net loss widening to $159.4M, driven by the permanent closure of blast furnace operations, a $90.2M capacity utilization charge, and $27.4M in US tariff costs. The company completed its transition to EAF steelmaking but is currently posting Adjusted EBITDA losses of $28.7M and burning cash, with liquidity supported by $126M in new government loan draws under the LETL facilities.
Key Facts
- Revenue declined 42.6% YoY to $296.9M from $517.1M
- Net loss of $159.4M vs net loss of $24.5M in prior-year quarter
- Loss from operations of $153.5M vs $139.9M loss YoY
- Adjusted EBITDA loss of $28.7M inclusive of $90.2M capacity utilization charge
- Direct tariff costs of $27.4M vs $10.5M in Q1 2025
- Steel shipments down 52.4% to 223,681 tons
- Cash used in operating activities of $12.2M vs generation of $92.1M in prior-year quarter
- Total available liquidity ~$553M including $195.1M revolver availability and $292.5M undrawn LETL facilities
- Permanently ceased blast furnace production on January 18, 2026; EAF Unit 1 fully operational
- Deficit increased to $1,057.3M from $897.9M at year-end 2025
Financial Impact
Q1 2026 net loss of $159.4M, operating cash burn of $12.2M, and tariff costs of $27.4M
Risk Factors
- Sustained 50% US tariff on Canadian steel exports continues to pressure margins and volumes
- Capacity utilization charge may not decline as fast as guided if EAF ramp faces delays
- Further deterioration in liquidity if operating cash burn persists; government loan terms may tighten
- Legal proceedings from frustrated supply agreements could result in material adverse judgments
- High debt load ($485M senior secured notes and $271M governmental loans) with limited near-term free cash flow
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 7 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 6-K Filing (Primary) | 0001193125-26-220324 |
| Document: d144507dex992.htm | 0001193125-26-220324 |
| Document: d144507dex991.htm | 0001193125-26-220324 |
| Document: d144507d6k.htm | 0001193125-26-220324 |
| Document: 0001193125-26-220324-index-headers.html | 0001193125-26-220324 |
| Document: 0001193125-26-220324-index.html | 0001193125-26-220324 |
| Document: 0001193125-26-220324.txt | 0001193125-26-220324 |
Track record builds as more directional reports settle.
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
May 22, 2026 22w ago | 6-K | $0.1001 $0.0498 | ▲ +50.25% | ▲ +51.93% | — |
May 12, 2026 23w ago | 6-K | $0.1001 $0.1001 | · 0.00% | ▼ −1.16% | — |
Apr 10, 2026 28w ago | 6-K | $0.1001 $0.1001 | · 0.00% | ▼ −3.30% | — |
Apr 7, 2026 28w ago | 6-K | $0.1001 $0.1001 | · 0.00% | ▼ −3.52% | — |
US Market Status
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