Good morning everyone and welcome to Stelco's quarterly earnings conference call. Speaking on the call today to discuss our second quarter results for 2021, will be Alan Kestenbaum, our Executive Chairman and Chief Executive Officer and Paul Scherzer, our Chief Financial Officer.

Yesterday, after the market closed, we issued a press release overviewing Stelco's financial results for the second quarter of 2021. This press release, along with the company's financial statements and management's discussion and analysis, have been posted on SEDAR and on our Investor Relations website at investors.stelco.com.

We have provided a link to the presentation referenced on today's call on our website as well. I would like to inform everyone that comments made on today's call may contain forward-looking statements, which involve assumptions, which have inherent risks and uncertainties.

Actual results may differ materially from the statements made today, so do not place undue reliance upon them. Stelco management disclaims any obligation to update forward-looking statements, except as required by law.

With that in mind, I would ask everybody on today's call to read the legal disclaimers on page two of the accompanying earnings presentation and also refer to the risks and assumptions outlined in Stelco's public disclosures, in particular, the second quarter 2021 management's discussion and analysis sections relating to forward-looking information and risks and uncertainties as well as our filings with securities commissions in Canada. The appendix of our presentation and the non-IFRS performance measures and review of non-IFRS measures of our MD&A provide definitions and reconciliations of the non-IFRS measures that we will use today.

Please also note that all dollar figures referred to in today's call will be in Canadian dollars, unless otherwise noted. Following today's prepared remarks, Alan and Paul will be taking questions.

To maximize efficiency, we would ask that all participants who would like to ask a question, please limit themselves to one question and one follow-up question before re-queuing. With that, I would like to turn the call over to Alan.

Thank you Trevor and good morning everyone. Today, Paul and I would like to share with you some of the details regarding Stelco's second consecutive record setting quarter.

During our first quarter call, we shared with you our collective optimism and offered some guidance regarding the outstanding earnings potential of Stelco for 2021. We are delivering on those expectations.

We have worked tirelessly for the last four years to build a business that is capable of generating cash and returning value to our shareholders in every stage of the market cycle. Our investments in new technology to diversify our product base and improve the overall efficiency of our business are paying dividends not only towards our bottomline, but to our shareholders as well.

As you can see from our results, we are capitalizing on our investments in our operations, maximizing production to our technical flexibility model and fully capitalizing on the tremendous opportunity presented by the strong and still improving steel market. Just this morning, about an hour ago, the CRU hit yet another record by increasing by $21 per ton to $1,884 per net ton for a hot-rolled coil.

With record revenue in excess of CAD900 million for the quarter, we have done an exceptional job of translating those gains directly to our bottomline by generating CAD380 million in adjusted net income and CAD410 million in adjusted EBITDA. These results combined with even better performance this current quarter and favorable bookings into Q4 position us well to deliver on the expectations we set.

We continue to build momentum and capitalize on improving pricing, strong customer demand in our key end markets, low customer inventories and the low cost position we have created for our business. But we are not done.

We are continuing to find ways to drive down our costs, in part by executing the remaining components of our strategic capital plan that we expect to conclude in the coming months and that will further improve our efficiency, enhance our cost structure and advance us along our path to reduce carbon emissions. The upgrade of our Lake Erie Works coke battery is continuing and on track to be completed in the fourth quarter of this year.

Once complete, it is our expectation that the strategic upgrades made to the coke battery will not only increase our production capability by up to 50,000 net tons of coke but will lower our production costs even further. At the same time, construction of our new 65 megawatt cogeneration facility is well underway and scheduled to be operational in the second quarter of 2022.

Our partnership with DTE Energy Services will deliver a state-of-the-art facility that will reduce our electricity costs, enhance our energy reliability and further reduce our carbon footprint. In the current market, Stelco is extremely well-positioned to continue our strong financial performance and take full advantage of our operating structure.

We have employed a strategy to modernize our primary operations and take full advantage of best-in-class technology from around the world, such as the commissioning of North America's only smart blast furnace. Additionally, as you can see on page four of our earnings presentation, Stelco's implied average cost across all of our products is lower than what our electric arc furnace competitors pay just for scrap which is, of course, their primary raw material.

This demonstrates a sizable cost advantage for Stelco against its EAF steelmaker competitors. With more and more steel makers planning to transition to EAF steelmaking in the coming years, there will continue to be increasing demand pressure on what is a relatively fixed North American scrap market.

Combined with our modernized integrated assets and a reliable and favorably priced long term supply of key raw materials, we view this as a growing cost advantage for our business. We have now shown that our investments and our strategy are delivering results and have opened the door to sizable future opportunities.

We have come a long way in the last four years and have established Stelco as not only a low cost steelmaker in North America, but also as an attractive investment for shareholders. Over the course of this quarter, we have deployed our strategy effectively and have been very successful at translating favorable market opportunities to success on our bottomline by converting 92% of our EBITDA into net income and 75% of our EBITDA into operating free cash flow.

As a result, we have replenished and are continuing to build our cash balance. We have paid off our revolver and we have put our business in position where we can reward our loyal and valued shareholders by implementing the beginning of a capital allocation strategy to doubling our quarterly dividend to $0.20 per share.

I am pleased that we are in this position and excited for what the future holds as we work towards completing our strategic capital plan and begin to realize the full potential of the powerful business we have created. With that, I would ask Paul to provide some additional comments regarding our exceptional financial performance this quarter.

Thanks Alan and good morning everyone. Throughout the second quarter, we remained focused on capitalizing on the opportunities presented by the market and not only increased our shipment level slightly, but successfully converted extremely favorable pricing directly to our bottomline.

While our average selling price increased by 35% from the first quarter, we delivered more than a 200% improvement in net income and CAD410 million of adjusted EBITDA, a 122% improvement over the first quarter. Of course, these figures are in part a result of the continued escalation and pricing through the period but equally a result of our ability to maintain our low cost position and fully capitalize on the opportunities presented to us.

As noted in our presentation, our implied average cost across our entire product mix remained constant during the quarter as a result of our employees' collective determination to operate our facilities efficiently and at a high level of productivity. This focus on reducing costs and maximizing margins has contributed greatly to the success of our business through the first half of 2021 and remains a focus area for our entire management team.

When we compare a level of success to that of our reporting peers, it becomes even more evident that our success is driven by more than record price levels. Our adjusted EBITDA margin of 45% is about 20 percentage points higher than the average margin reported by our flat-rolled peers.

Our comparative success is not an accident. It is a result of a focused and deliberate effort to be a low cost producer and to drive market opportunities right down to the bottomline where our shareholders obtain the greatest benefit.

As Alan noted, our performance has put us in position to be able to double our quarterly dividend and also has allowed us to further strengthen our balance sheet. During the quarter, we paid down in full the revolving portion of our asset-based loan, continued to use internally generated funds for the final stages of our major capital plan and ended the quarter with CAD247 million of available cash, a balance that has grown significantly since quarter end and continues to grow weekly.

This notable improvement in our cash position and the overall increase in our liquidity positions us well to fund capital expenditures plan through operations and to explore and evaluate various capital allocation alternatives, one of which is the increased dividend announced today. As we have noted in the past, our management team is fully aligned with the interest of our shareholders and we will continue to monitor the market and listen to advice of leading experts and will make decisions in this regard at the appropriate time.

We are pleased the full benefits of the blast furnace upgrade and other strategic investments are being realized and increases in our production levels are translating into increased shipments in 2021. Our first two full quarters since completing the blast furnace project have seen consistent levels of shipments with the second quarter coming in at 679,000 tons, up modestly from the first quarter.

Going forward, we expect third quarter volumes to remain in line with our strong shipping levels of the quarter we recently completed. We continue to monitor developments with respect to the COVID pandemic and the ongoing recovery.

We are pleased with our company's ability to respond and the resilience of our employees throughout this challenging period and hope that we can continue to take significance strides forward in collaboration with our customers as we collectively participate in the ongoing economic recovery. Overall, the second quarter built upon the success we achieved in Q1 and we are excited to have been able once again deliver record results and to be able to translate that success into heightened dividends for our shareholders.

Going forward, we will stay true to our strategy, our principles and our values, regardless of pricing levels or the state of the market. We will maintain a strong balance sheet.

We will utilize our tactical flexibility model to pursue the highest possible margins across all product lines. And we will deploy our capital in a responsible manner that benefits all our shareholders.

These are the tools that contributed to our success and we will not deviate from them. By staying true to these commitments and taking full advantage of market opportunities as they arise, I am confident that we will continue to deliver successful outcomes.

Thank you for taking the time today to join our call.

Thank you, Alan and Paul. That concludes our prepared remarks for this morning.

And I would now like to turn the call back over to the operator for questions-and-answers? Operator?

Well on pricing, obviously, a very good quarter. But when we look at index pricing and things like that, it does, at least in my view and it's in your slide deck as well, suggests there's quite a bit more upside as we go through the second half of the year.

So my first question is, any reason realized prices should not be over CAD2,000 by the fourth quarter?

Sorry. Yes, David.

Hi, this is Alan. If you look at how we have been tracking for the year, always because demand is good and the lead times are long and we are running about three months, selling basically three months before the quarter and selling when you look back roughly close to the index.

So the answer to your question is, no, there is no reason why we shouldn't see that. The current CRU in $1864.

You multiply that by 1.25 and you are over CAD2,000. So no, there's no reason why that shouldn't be realized.

Okay. That's helpful.

Thank you. And then just one of the bigger questions is, what are you going to do with that big pile of cash?

I know last quarter, there was more commentary about shareholder returns, with a bit more of an emphasis on buybacks. I am wondering if you could share additional thoughts and details on how investors should be expecting or what investors should be expecting as we move through the next six months with that pile of cash?

Yes. Consistent what we said at the last call, we expected to start building up a lot of cash.

We are building up a lot of cash, continuing to do so, expect to build more cash. We said at that time as we expected to be able to outline on what we are going to do with that.

It's a monumental opportunity for us to have some meaningful things that should impact share price in a very positive way. And so I think we said last time that we would have some news on that during the third quarter and the latter part of that quarter.

And consistent with the time that we outlined last quarter, we expect to be in position to make an announcement when we have an announcement to be made. Just to remind everybody, we will benefit from a better share price based on the performance.

We continue to consider the shares to be not priced at the right price. And what our plan is to hopefully say something before the end of this quarter.

And the management of this company is collectively probably the biggest shareholder in this company and no one is motivated than us we. And we expect to be able to do the right thing for all shareholders, including the management shareholders as well.

And so, like I said last quarter, let's hang on to your hats and we will have hopefully something here in the next few weeks.

Okay. Just a quick follow-up on that.

As you assess the opportunities out there and considering the implied valuation of Stelco shares, can you prioritize the plans for the cash in terms of between rather it's buying back stock or inorganic investments, organic investments? What would the likely packing order be?

Look, I think probably at this point, the inorganic investments are probably not top of our list. We believe we have got, just look at our margins this quarter, I mean what could we buy that would enhance those margins?

I don't know of it. So maybe put that one off the list for now and we certainly can't get more specific at this point, except to say that whatever we do, we want to do it in a big way and do it in a way that will be meaningful.

And we will make announcements as and when we are prepared to do it.

Okay. That's helpful.

Thanks. I will get back in the queue.

Thank you.

Thanks. Good morning everyone.

Maybe I can follow-up a little bit on David's line of questions there. And when I think about your cash balance and it's building up here, is there a minimum cash balance that you are comfortable with so we can sort of get a sense on what that capital distribution could look like?

Well, look, we always like keep a certain, our goal is to keep our balance sheet debt free. We think that that sets us apart from most of our competition that have built their businesses with a lot of debt and are saddled with a lot of legacy liabilities.

So in our case, our legacy liabilities are not on the balance sheet and sense of obligation. We have no exposure whatsoever to any actuarial changes or anything like that and the same with debt.

We try to keep our debt very, very low. That served as well during in COVID.

We had a situation where during COVID, smack in the middle of COVID, when everyone was hanging on to every dollar, we able to go and spend CAD150 million on our blast furnace and we are also able to do the Minntac agreement. So that served us well to act at a time when the market looked like it was falling apart.

So our strategy is to stay highly liquid to take advantage of opportunities when they arise. And so we look at cash the same.

Our preference is to have no debt, stay unique, keep enough cash on hand to be able to act decisively and in big ways during markets opportunities that present themselves. Having said that, our expectations are based on the earnings and the pricing and everything else that we are going to generate significantly more cash than what we think we need to keep on the balance sheet.

And our plans are to use that for something that would be helpful in making the share price reach a value that where we can get them where they most belong.

Yes. That's very helpful.

And then my next question is on the cost structure here. With the coke battery largely finished here and the cogen coming online in Q2, can you provide us with an update on how much your cost structure can be reduced on a per ton basis?

Yes. We think there's another roughly, between the two of them roughly, CAD15 a ton or something like that.

I know that sounds like a ridiculously small number when week-after-week CRU is going up by CAD20 to CAD40, But I think that's one of the beauties of the culture at Stelco. We continue to focus in every department of things that we can control.

And these two projects were announced at a time when steel prices were considerably lower than where they are today, but we still continue to go with that. And I think that's one of the beauties of this company.

The fact that it sounds like it doesn't move the needle in almost $1,900 price environment but I think that's the beauty of this company. Our sales guys are out doing what they can do on their side.

Our purchasing people are looking to save every single nickel on that side. And our operations people are looking to save every single nickel they can on the production side.

And so that's I think is how much we say, which is great. We are already in a leading position there as you can see our margins.

But also on top of it, you really get to see the culture of the company, which is to literally chase nickel, because that's what this business is about ultimately in the long term.

That's my cue. Thanks so much.

Yes. Good morning.

Thanks guys for taking my question. I am just curious on the land package.

I know you guys have given updates previously. I am just curious if there's any updates now in terms of the severance?

When we might get an update on that in terms of potential dispositions? Thanks.

Sure. The only update on that is that we continue you to work with the city.

We have had some very productive conversations. They remain very interested in seeing this side of Hamilton.

Those of you who been there know that when you cross that bridge from Burlington, the very first thing you see is our plant and that land. And that's something that's both in our interest and the city interest to get it done.

The discussions are constructive and continue to move along those path and I am very confident that we will be able to get what we need in order to move forward with our plans for the land. The good news is that while it's taken a lot of time and more time than what we needed, this land just continues to increase in value.

A lot of people have demonstrated interest in this. Just in general, with the interest rate environment being, lower cap rates having dropped and the incredible appetite for the very perfect uses for this land, which include studios, data centers last-mile delivery centers, distribution warehouses, I mean exactly what this land could be used for in a very profitable way.

And so with cap rates dropping, ample liquidity, the longer this takes, the more valuable land takes and at the same time we are moving forward with those discussions with the city. And they are definitely much more frequent and much more productive and continuing to make progress along the lines of what we had said last quarter.

Thanks Alan. Just one other one.

In terms of the shipped tons, the breakdown between HRC coated and cold rolled, I curious if you expect to see any sort change in that breakdown and if there's potential upside in terms of your realized pricing? Thanks.

Yes. I mean, what we do, I think again another distinguishing part of this company's strategy is what we call tactical flexibility.

And technical flexibility is our ability to shift from one product to the next very quickly, be present in all markets, be able to shift production in each of those and maximize profitability. So I would say two things.

One, if you look at the average sales price, it comes out to CAD1,292, which is a hair over a CAD1,000 a ton for all products, whereas the current market price for CRU now is CAD1,880. So there's clearly enormous upside between what was booked in Q2, which was probably sold at the end of 2020 and early 2021.

So back in those days when the market price is lower, that's what you are seeing reflected in the current quarter. Right now, with the CRU having gone up, you can see what would be realized if we were to sell product today also into Q4.

So yes, enormous upside to the current earnings based on the mark-to-market, specifically CAD1,092, we don't break down the price of all products, but obviously the HRC portion of that was lower. And if you add $800, that's CAD1,000 on top of that, you can pretty much mark-to-market what our earnings profile would be if we sold things today as compared to what we did in what was reported this quarter simply by doing that math.

So there's upside in two respects. One, the CRU higher, market is much higher obviously.

And then on top of that, probably some further price appreciation on downstream value-added products as well.

Thanks a lot. That's all for me.

Yes. Hi.

Thank you for taking my questions. The first one maybe on working capital.

Can you give us a sense of what you would expect in Q3 and maybe in H2, given that you see a pricing, higher prices showing stable volumes? What are your expectations there?

Yes. Hi, Tristan, it's Paul.

So for working capital, I mean, as you know, as we go through the year, raw materials inventory increases a little bit heading into the winter season. The rest of our inventory should be relatively static.

So the change you are going to see is really on the receivables. And the way I think about that is, when you look at really our ASP in the last month of the quarter versus our ASP in the last month of the prior quarter, that's when you should get something approximating or change in receivable because as we said, we are expecting shipments to be about level.

So it's really going to be kind of the exit ASP because we sell on 30-day terms typically. So not to be too precise on it, but you are going to see a pretty significant uptick this quarter with selling prices given what's been going on with CRU over the last few months.

All right. That's so it could be higher than Q2 then, if I understand you correctly?

At this point, I would be shocked if it wasn't a fair bit higher.

All right. That's helpful.

My second question is a bit more on decarbonization. I mean two of your closest peers have announced getting funding to build EAF and ERI plans to cut their carbon emissions and I was just wondering, when you look at capital allocation, is decarbonization at all on the agenda?

If you have any discussion with the Canadian government for any investment there? And do you see any risk, competitive risk, two competitors that can offer lower carbon steel as well.

So, yes, your thoughts on that would be appreciated.

Sure. First off, let me say the following.

Canada has the lowest output per ton of carbon of any country in the entire world. So when we start with Canada, Canada starts from a position of already being the lowest cost emitter of carbon Secondly, absolutely.

Every steel company that's out there today knows that the carbon reduction is something that people want to see and we are working on our own plan. It will be different than what you have seen from the other competitors and we think will be better.

We also think that we can do without government funding better because the government funding is a loan. It's not a grant.

You got to pay it back. And consistent with our policy of keeping a clean balance sheet, taking debt from the government is not our preferred approach.

That doesn't mean we won't to do it if it becomes the best source of financing. But at the moment, we are certainly moving along.

We have an existing pathway of carbon reduction. It's certainly high on our agenda.

And we want to make sure we do things smart and efficiently, consistent with our capital program and consistent with our approach to our balance sheet.

All right. That's very good.

Thank you.

Hi. Good morning guys.

I guess maybe more of a curiosity question on hedges. Certainly, up to this point, HRC surprised essentially everybody to the upside.

But when I look at the futures curve, I see an opportunity for Stelco to essentially lock up strong free cash flow potential into 2022. And while I can't say where HRC prices would go, I would say that your share prices or your share is pricing in HRC well below the futures curve.

So with that context, I mean, why not go out there, lock up some hedges, secure higher free cash flow and commit to more buybacks?

Well, in terms of the first part of your question on the hedging, we think the forward curve is just way too low. We are looking at CAD1,884 today for prices.

And next year the averages, if you look at the market as you are saying it's fairly healthy on historical terms in terms of I think it averages out to $1,250 for the year next year, that's U. S.

Dollars. But that’s 35% lower than the current market.

And we think that prices are going to go higher and stay stronger. There's a lot of things going on in the market I don't think that people really understand.

I think we are going to see prices continue to go up. If we do decide to hedge later on, it's not something I am planning on doing now, but I think the a long, long way down from where we are today to what the forward curve presents and I think we are better off not hedging.

Interesting comments. Thanks Alan.

And I guess, I mean based on those comments, you don't see steel pricing normalizing at any point through 2022. Is that fair?

And I guess, if that is fair, I mean, what point do you expect steel pricing to normalize maybe a little bit more thoroughly?

Well, I mean, I think the first question is what's normal. We think that things are changing.

The previous question that came in was about decarbonization. There's been a big shift to EAF production.

EAF production is based on scrap. Scrap already is short, it's going to get shorter as people transition to EAF production as more EAF production comes on.

And so that means that scrap goes higher, steel prices say higher and normal becomes the newly defined term. I don't know if it's going to be CAD1,800 or CAD2,000 or it's going to CAD1,500 or CAD1,400.

But I don't think the days of steel prices where they were are relevant anymore. We built this business around this thesis.

It's not something new. I have been talking about this for three years, how cost is going to go up, how the market is moving.

What I did not realize at the time was the incredible movement of China and other overseas countries moving into the EAF production. There is, just so people understand, is two billion tons of steel production is two hundred million tons roughly of scrap availability for that market.

So the market is rapidly moving to more and more EAF production for good reason. A lot of it having to do with decarbonization and that trend will not change.

And I think the squeeze on scrap continues to go up. Today, we are looking at bushelling future that are over CAD700 a ton.

And these guys in EAF need to make CAD250 on top of that. So you are looking at, is CAD1,000 the new normal.

I don't know what the new normal is. But I don't think the old pricing we are just saying historical norms are relevant anymore.

And so I think we need to get people accustomed to what things actually cost in terms of steel production, in terms of return on capital. Companies need to get both, return on capital and cover their variable costs.

And so we think we are entering into a new period of time. I am not sitting here saying that current pricing is the new normal.

I don't want to say that. Certainly enjoying it.

But I don't think that the lows are going to be anything like what they used to look like. And I think that the world that needs to get used to it.

And in fact, when we talk to our customers, whether their auto customers, pipe customers, other customers, they acknowledge and they have had no problems passing this downstream to their customers as well. So I think this is something that's very, very important to understand.

And inevitably it also goes back to the hedging question, like what is the right price? And we think we are really, really well positioned to enjoy exceptional profits for many years based on how we see the market develop.

And I think it feels great to be able to say, look, we kind of called this a few years ago. It took a lot of guts to make the investments that we made, both in terms of raw materials into the blast furnace at a time where everything looked like the world was coming to a bleak end about a year ago.

But we had confidence in what we decided would be the right business plan and thesis on the market that we developed two or three years ago. And now it's playing out and I think it's too early to decide what is the new normal price.

I can make all kinds of cases. I could be right.

I could be wrong. But so far, we have called it right.

And we just think we need to let time play out. It’s a long, long way away where we get into a place where we are not going to make exceptional profits from the pricing today.

You have been looking at the curve. We would make tremendous amount of money next year as the prior caller suggested.

But we just don't know where the new normal settles out. And the market is saying, continues to be short, inventory to lean.

We have an infrastructure bill coming. Don’t forget, this is all the context of an auto production that is restrained from the chip shortage.

Wait till that loosen up. So who knows where this goes.

And we are just going to continue to ride it for now and enjoy the ride but continue to, like I said before, save nickels wherever we can and really look to deploy our capital in a way to really maximize and get our company valued the right way.

That's great. Thanks Alan.

Very interesting, nicely done, obviously.

Yes. Thanks.

Good morning. Alan, I wonder if you could talk to kind of longer term capital spending plans for the company?

Do you see scope for any more modular type investments, be it value finishing lines? Anything ancillary to that?

Yes. We certainly do.

We are looking at a whole bunch of things right now. But I want to tell you how we measure capital versus how I think other people measure capital.

Someone may say, hey, I could make and I will just use this as an example. I can make galvanized steel for X and I can tell it to Y.

We look at it as what are we actually getting for the marginal operations, right. There's yield loss and of course, yield loss grows as the market goes higher because you are losing the same tons a higher priced when you make that calculation because you are in a higher market.

So as the prices go up, the spread between HRC and other downstream products has to get bigger. Can't stay the same.

And we measure the capital returns on that marginal improvement taking into account yield loss. And then we have 30% return on invested capital that is an internal threshold that we have.

So we are very, very disciplined in that. Having said that, we are focused on the number of opportunities that we think could have meaningful impact to the company's revenue and profits and we are focused on that.

And that's what we do all day. It's too easy to sit and make steel to what we make it and to sell into the market.

That's obviously easy. And then what we do, this management team is constantly looking for ways to, on one hand, cut costs, but on the other hand look to increase revenues, increase profits and we are continuing to do that.

Okay. What would be, if you can you give any rough guidance on 2022 CapEx at this point?

Yes. I think we have said before.

Our big capital plan is over this year. We have, I think, invested CAD700 million, CAD800 million into this facility since I bought this company in the middle of 2017.

We are going to go to maintenance mode next year, CAD85 million dollars. That's the guidance I can give.

If we do decide do any special projects that would be in addition to that and we will make those announcements as they come. But for now, I think you can put in the maintenance number.

Okay. I mean, do you think it's likely you are going to add more downstream finishing value-add processing in the next one to two years?

I mean we pretty much have the full suite of what we need right now. I mean we are able to meet the customers' most stringent demands.

So I don't see anything that's compelling us to do that right now. I don't rule it out if the right opportunity comes around.

But right now, as you can see, we are having no problem selling all the steel we need to produce at industry-leading margins. And so whatever we would do would have to be even more compelling, more profitable.

I don't see anything specifically on the downstream side right now that is compelling at us to beat the returns we are doing right now.

And are you contemplating adding an electric arc at some point in the future?

Well, I mean look, we will make announcements on investments when and if we do. But I think you can tell from our other comments that we have made so far today.

The electric arc business is challenged because of its raw material supply. We consider that to be an opportunity to Stelco.

So if we would go in the direction, it certainly wouldn't be, hey, let's go short scrap. It would be something that would be more well-planned and more specific about, okay, we can go build an electric arc furnace but what the heck are we putting in it and make sure that we cover that too.

So I think we will be very thoughtful about what we do. We don't rule anything out.

But we try and do things little differently here than everybody else.

Would it make sense to maybe convert Hamilton to a pig iron facility to feed into an electric arc? I know in the past you said you don't have any plans to be a merchant pig iron producer.

But could that be something that could occur?

Look, to make pig iron, you need more iron ore. And that's got its own constraints.

All right guys. We are over the time here.

So first of all, I want to just thank everybody for your participation today and we have got a lot of great things going and we are always happy to meet our investors through meetings and I am sure love the input, love the support and looking forward to more great times ahead. So thank you very much.