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ALGOMA STEEL INC . Algoma Steel Inc. Announces Strong First Quarter Results ; Parent Company Expected to Become Public in 2021 August 19 , 2021 SAULT STE . MARIE , ONTARIO ( August 19 , 2021 ) – Today Algoma Steel Inc. ( the " Company " ) reported strong first quarter results for the fiscal quarter ended June 30 , 2021 , setting the stage for its parent company , Algoma Steel Group Inc. ( " Algoma " ) to become a public company later in 2021. Unless otherwise specified , all amounts are in Canadian dollars . In the first quarter of fiscal 2022 , the Company earned a net income of $ 214 million , up from $ 114 million in the prior quarter and a $ 43 million loss in Q1 fiscal 2021 . The Company's strong financial performance is primarily attributable to an improvement in shipment volume , strong steel demand and improved selling prices . Shipments for the first quarter increased by 47 % to 610,000 tons , compared to 416,000 tons in Q1 fiscal 2021 , culminating in steel revenue of $ 765 million , up 124 % from $ 423 million in the first quarter of fiscal 2021 and from $ 633 million in the prior year quarter . The strong demand and realized pricing , as well as the Company's focus on cost containment , contributed to $ 281 million of Adjusted EBITDA for the first quarter , up from $ 167 million in the prior quarter and $ 21 million in Q1 fiscal 2021. As described below , Adjusted EBITDA is a non - GAAP / IFRS measure of profitability that management uses as an indicator of the operational health of the business . The Company's Chief Executive Officer Michael McQuade remarked on the Company's first quarter performance , " We believe that our ongoing focus on keeping our employees safe and developing a culture of continuous improvement , coupled with a steady stream of strategic investments in our operating facilities , improves our position across the steel cycle . The extended strength we see in the steel market positions us favorably for our pending return to public markets . In addition , last month's announcement of the Government of Canada's anticipated $ 420 million in support for our proposed transition to electric arc furnace ( " EAF " ) technology , together with up to US $ 306 million of new equity capital that may be provided by our merger with Legato Merger Corp. ( " Legato " , NASDAQ : LEGO , LEGOU , LEGOW ) , is expected to make our sustainability transformation possible . " Cautionary Information About Forward - Looking Statements This news release contains forward - looking statements within the meaning of applicable securities legislation . These forward - looking statements generally are identified by the words “ believe , ” “ project , ” “ expect , ” “ anticipate , ” “ estimate , ” “ intend , " " strategy , " " future , " " opportunity , ” “ plan , ” " " pipeline , " " may , " " should , " " will , " " would , ” “ will be , " " will continue , " " will likely result , " and similar expressions . Forward - looking statements are predictions , projections and other statements about future events that are based on current expectations and assumptions . Many factors could cause actual future events to differ materially from the forward - looking statements in this document , including but not limited to : the risk that the anticipated benefits of the Government of Canada's funding , which is subject to the negotiation of definitive documentation , will fail to materialize as planned or at all ; the risk that the benefits of the proposed merger with Legato ( the " transaction " ) , including the amount of proceeds provided thereby , may not be realized ; the risk that the transaction may not be completed in a timely manner or at all ; the failure to satisfy the conditions to the consummation of the transaction , including the failure of Legato's stockholders to approve and adopt the merger agreement or the failure of Legato to satisfy the minimum cash condition following redemptions by its stockholders ; the inability to complete the concurrent private placement in connection with the transaction ; the occurrence of any event , change or other circumstance that could give rise to the termination of the merger agreement ; the outcome of any legal proceedings that may be initiated following announcement of the transaction ; the effect of the announcement or pendency of the transaction on Algoma's business relationships , operating results and business generally ; risks that the proposed transaction could disrupt current plans and operations of Algoma ; the risks associated with the steel industry generally ; the ability of Algoma to implement and realize its business plans , including Algoma's ability to transform to EAF steelmaking ; the risk of downturns and a changing regulatory landscape in Algoma's highly competitive and cyclical industry ; and changes in general economic conditions , including as a result of the COVID - 19 pandemic . The foregoing list of factors is not exhaustive and readers should also consider the other risks and uncertainties set forth in the section entitled " Risk Factors " and " Cautionary Note Regarding Forward - Looking Statements ” in Legato's final prospectus dated January 19 , 2021 relating to its initial public offering ( the “ Legato Final Prospectus " ) and in subsequent filings with the Securities and Exchange Commission ( the " SEC " ) , including the amended proxy statement / prospectus described below , filed by Algoma and Legato in connection with the transaction . Forward - looking statements speak only as of the date they are made . Readers are cautioned not to put undue reliance on forward - looking statements , and Algoma and Legato assume no obligation and do not intend to update or revise these forward - looking statements , whether as a result of new information , future events , or otherwise . Additional Information and Where to Find It This news release is not a proxy statement or solicitation of a proxy , consent or authorization with respect to any securities or in respect of the transaction and does not constitute an offer to sell , buy or exchange or the solicitation of an offer to sell , buy or exchange any securities or the solicitation of any vote or approval in any jurisdiction , nor shall there be any sale , purchase , or exchange of securities or solicitation of any vote or approval in any jurisdiction in contravention of applicable law . In connection with the proposed transaction between Algoma and Legato , Algoma has filed with the SEC a registration statement on Form F - 4 which includes its prospectus as well as Legato's preliminary proxy statement ( as amended , the “ Preliminary Proxy Statement / Prospectus " ) . Legato plans to mail the definitive Proxy Statement / Prospectus to its stockholders in connection with the transaction once available . INVESTORS AND SECURITYHOLDERS OF LEGATO ARE URGED TO READ THE PROXY STATEMENT / PROSPECTUS AND OTHER RELEVANT DOCUMENTS FILED OR TO BE FILED WITH THE SEC CAREFULLY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT ALGOMA , LEGATO , THE TRANSACTION AND RELATED MATTERS . Investors and security holders will be able to obtain free copies of the Preliminary Proxy Statement / Prospectus and other documents filed with the SEC by Algoma and Legato through the website