Stelco (STLC) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue was $716 million, down 4% sequentially and 15% year-over-year, driven by lower average selling prices and shipping volumes.

• Adjusted EBITDA reached $147 million with a 21% margin, down 4% from Q1 2024 and 32% from Q2 2023, maintaining industry-leading profitability.

• Net income for Q2 2024 was $67 million, up 6% from Q1 2024 but down 43% year-over-year.

• Announced a 50% increase in quarterly dividend to $0.75 per share and repurchased 518,238 shares in Q2.

• Cash at quarter-end was $657 million, with total liquidity of $884 million.

Financial highlights

• Average selling price per net ton was $1,085, down 4% sequentially and 11% year-over-year.

• Shipping volume was 634,000 net tons, nearly flat sequentially and down 3% year-over-year.

• Adjusted EBITDA margin held steady at 21%, leading industry peers.

• Adjusted Net Income for Q2 2024 was $71 million, up 1% sequentially but down 42% year-over-year; Adjusted EPS was $1.29.

• Six-month revenue was $1,462 million, down 4% from the prior year period.

Outlook and guidance

• Management reaffirmed commitment to value creation, tactical flexibility, and positive shareholder returns, as reflected in the dividend increase.

• Forward-looking statements highlight expectations for continued strong cash generation and returns to stakeholders.

• Ongoing transaction with Cleveland-Cliffs announced July 15, 2024, is a key focus.