Stelco Holdings Inc. is listed on the TSX under the symbol "STLC"
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HAMILTON, ON, Jan. 6, 2022 /CNW/ - Stelco Holdings Inc. (TSX: STLC) ("Stelco" or the "Company") announced today that the Company shipped approximately 625,000 net tons of steel in the fourth quarter of 2021, well below prior guidance of approximately 675,000–680,000 net tons. Shipments in the fourth quarter were negatively impacted by various production challenges, including unplanned outages on its hot strip mill, logistics challenges, and delays at the end of the fourth quarter brought on by the emergence of the Omicron variant which affected Stelco, its customers and logistics suppliers. Stelco is also providing guidance for the first quarter of 2022 of steel shipments at or potentially lower than the fourth quarter's. The lower guidance for the first quarter is due to planned outages that have been advanced in response to the unplanned outages experienced in the fourth quarter, recent softer price environment and weaker demand conditions being experienced currently, as well as increased COVID-19 related disruptions with respect to labour force availability, which is impacting production, logistics and customer demand.
Stelco is a low cost, integrated and independent steelmaker with one of the newest and most technologically advanced integrated steelmaking facilities in North America. Stelco produces flat-rolled value-added steels, including premium-quality coated, cold-rolled and hot-rolled sheet products, as well as pig iron and metallurgical coke. With first-rate gauge, crown, and shape control, as well as uniform through-coil mechanical properties, our steel products are supplied to customers in the construction, automotive, energy, appliance, and pipe and tube industries across Canada and the United States as well as to a variety of steel service centres, which are distributors of steel products. At Stelco, we understand the importance of our business reflecting the communities we serve and are committed to diversity and inclusion as a core part of our workplace culture, in part, through active participation in the BlackNorth Initiative.
This press release contains "forward-looking information" within the meaning of applicable Canadian securities laws. Forward-looking information may relate to our future outlook and anticipated events or results and may include information regarding our financial position, business strategy, growth strategy, budgets, operations, financial results, taxes, dividend policy, plans and objectives. Particularly, information regarding our expectations of future results, performance, achievements, prospects or opportunities is forward-looking information. In some cases, forward-looking information can be identified by the use of forward-looking terminology such as "plans", "targets", "expects" or "does not expect", "is expected", "an opportunity exists", "budget", "scheduled", "estimates", "outlook", "forecasts", "projection", "prospects", "strategy", "intends", "anticipates", "does not anticipate", "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might", "will", "will be taken", "occur" or "be achieved". In addition, any statements that refer to expectations, intentions, projections or other characterizations of future events or circumstances contain forward-looking information. Statements containing forward-looking information are not historical facts but instead represent management's expectations, estimates and projections regarding future events or circumstances. These statements include, without limitation, statements regarding Stelco's shipping volumes during the first quarter of 2022.
Key Assumptions Underlying our Shipping Volume Estimates for the First Quarter of 2022
The estimates with respect to our shipping volumes during the first quarter of 2022 referenced in this press release are based on a number of assumptions in addition to the foregoing assumptions, including, but not limited to, the following material assumptions: the Company's ability to continue to access the U.S. market without any adverse trade restrictions; no significant legal or regulatory developments, changes in economic conditions, or macro changes in the competitive environment affecting our business activities; upgrades to existing facilities remaining on schedule and on budget and their anticipated effect on revenue and costs; the Company's ability to attract new customers and further develop and maintain existing customers; currency exchange and interest rates; the impact of competition; and growth in steel markets and industry trends. We believe that our performance and our ability to achieve these shipments during the first quarter of 2022 depend on a number of material factors including: (i) sustained global demand growth; (ii) continued steel production capacity curtailments in China; (iii) continued fair trade practices, particularly with respect to the North American market; (iv) the COVID-19 pandemic not having an adverse impact on North American demand for our products; (v) continued signs of a broad economic recovery, together with ongoing economic support from federal, provincial, and local governments in respect of the COVID-19 pandemic; and (vi) stable supply and demand fundamentals in the rest of the world. These factors are also subject to a number of inherent risks, challenges and assumptions.
Undue reliance should not be placed on forward-looking information. The forward-looking information in this press release is based on our opinions, estimates and assumptions in light of our experience and perception of historical trends, current conditions and expected future developments, as well as other factors that we currently believe are appropriate and reasonable in the circumstances. Despite a careful process to prepare and review the forward-looking information, there can be no assurance that the underlying opinions, estimates and assumptions will prove to be correct. Further, forward-looking information is subject to known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking information, including but not limited to, those described in this press release. Certain assumptions, risks and uncertainties in respect of: the utilization of and access to our production capacity; planned outages that have been advanced in response to the recent softer price environment and weaker demand conditions being experienced currently; capital expenditures associated with accessing such production capacity; the impact of COVID-19 on our business (including labour force availability and the impact on our production, logistics and customers' facilities) and the broader market in which we operate; the market's ability to recover from COVID-19; upgrades to our facilities and equipment; our research and development activities associated with advanced steel grades; our ability to source raw materials and other inputs; our ability to supply to new customers and markets; our ability to effectively manage costs; our ability to attract and retain key personnel and skilled labour; our ability to obtain and maintain existing financing on acceptable terms; currency exchange and interest rates; the impact of competition; changes in laws, rules, and regulations, including international trade regulations; and growth in steel markets and industry trends are material factors made in preparing the forward-looking information and management's expectations contained in this press release and that may cause actual results to differ materially from the forward-looking information disclosed in this press release. Additional information about the risks and uncertainties of the Company's business and material risk factors or assumptions on which information contained in forward–looking statements is based is provided in its disclosure materials, including the Company's most recently filed annual information form and any subsequently-filed interim management's discussion and analysis, which are available under our profile on SEDAR at www.sedar.com.
Although we have attempted to identify important assumptions and risk factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other risks not presently known to us or that we presently believe are not material that could also cause actual results or future events to differ materially from those expressed in such forward-looking information. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward looking information, which speaks only as of the date made. The forward-looking information contained in this press release represents our expectations as of the date of this press release and are subject to change after such date. Stelco disclaims any intention or obligation or undertaking to update publicly or revise any forward-looking statements, whether written or oral, whether as a result of new information, future events or otherwise, except as required by law.