Diverse vessel and market portfolio provides resilience for Algoma

Algoma Central Corporation recently reported its results for the three and six months ended June 30, 2025. Algoma reported second quarter revenues of $211,715, compared to revenues of $180,968 in 2024. Net earnings for the 2025 second quarter were $32,883 compared to net earnings of $17,464 in 2024. EBITDA was $72,582 in the second quarter compared to $48,406 in 2024. All amounts reported below are in thousands of Canadian dollars, except for per share data and where the context dictates otherwise.

 

“During the second quarter, four newbuild vessels entered service across our domestic product tanker, domestic dry-bulk, and FureBear fleets,” said Gregg Ruhl, President & CEO of Algoma Central Corporation. “With these additions, we now hold ownership interests in 98 vessels, with ten more under construction—three of which are scheduled for delivery in the third quarter. This continued fleet growth is very exciting, but more importantly, it reinforces our diversification and strengthens our resilience in the face of ongoing global uncertainty. As we approach our 126th anniversary in August, we take pride in our historical ability to navigate through economic highs and lows. Following the quarter’s end, NovaAlgoma Cement Carriers Limited, our joint venture with Nova Marine Holdings SA, entered a definitive agreement with P&O Maritime Logistics, a DP World subsidiary, for the sale of a 51% controlling interest in NovaAlgoma’s wholly owned cement assets. This strategic transaction expands our global reach and aligns us with another strong partner,” continued Mr. Ruhl.

 

 

“Core performance remained strong, with reported revenues rising across our marine segments,” said Christopher Lazarz, Chief Financial Officer at Algoma Central Corporation. “In Domestic Dry-Bulk, higher volumes in iron ore and agriculture offset lower shipments in salt and construction materials. A new iron ore customer and growth in export grain provided momentum, though supply issues constrained salt volumes, and trade uncertainty tempered aggregate demand. In Product Tankers, a larger fleet and fewer dry-dockings contributed to continued strength and improved utilization. Ocean Self-Unloaders benefited from robust Pool performance and higher base freight rates. Meanwhile, Global Short Sea Shipping saw stronger equity earnings, particularly in the mini-bulker and cement fleets, and our FureBear joint venture continues to perform well with seven of ten newbuild vessels now in service,” concluded Mr. Lazarz.

 

 

In the Domestic Dry-Bulk segment, projected demand for the balance of the year is strong and will require the full fleet to operate through the remainder of the season. Domestic iron and steel volumes face demand constraints related to U.S. tariffs on Canadian steel and will depend on a favourable resolution of the trade dispute. Strong grain demand in the fourth quarter may help to offset any reductions in other sectors if the new crop develops as expected. Construction and salt volumes are expected to improve from second quarter levels and remain steady through the balance of the year.

 

In the Product Tanker segment, we expect customer demand to remain steady in 2025 and for fuel distribution patterns within Canada to support strong vessel utilization for the vessels trading under Canadian flag, including the two new tankers operating on long-term contracts with Irving Oil. The fleet is expected to remain in full deployment with all ten Canadian vessels in operation.

 

In the Ocean Self-Unloader segment, vessel supply at the Pool level is fairly well balanced for the remainder of the year. Volumes in the aggregate and gypsum industries declined as anticipated during the second quarter and we expect these industries will continue to be impacted for the balance of the year; volumes in the other sectors are expected to remain steady moving forward. Two additional vessels in the Algoma fleet will be dry-docked over the remainder of 2025 (for a total of four dry-docks in 2025), which is expected to have a significant impact on available days. The first of three new ocean self-unloaders is expected to be delivered in the third quarter of 2025.

 

Within our global joint ventures, we anticipate steady earnings from the cement fleet, with most assets committed to long-term time charter contracts. The handy-size fleet, together with the mini-bulker fleet, is expected to perform at reduced levels compared to 2024. Two newbuild mini-bulkers and two pneumatic cement carriers are currently under construction and are expected to be delivered between 2025 and 2027, with the first mini-bulker set to arrive in the third quarter of 2025. These vessels will bring the newbuilds added to the mini-bulker fleet to six since 2020. With the delivery of the first seven FureBear newbuilds in 2024 and the first half of 2025, three new tankers remain on order for the joint venture, with delivery expected between the third quarter of 2025 and early 2026. The Company is anticipating a continued steady rate environment for these tankers.

 

Global tariffs could increase operating costs and reduce trade volumes, potentially leading to shifts in global supply chain routes. While Algoma is closely monitoring the situation, we do not anticipate major changes in cargo volumes at this time; however, we are expecting continued higher costs across our supply chains, and are exploring ways to mitigate potential impact.