Turcotte says 19 out of 20 ASI employees support layoffs

Denis Turcotte, Algoma Steel's president and chief executive officer, today predicted good performance from his company over the next couple of quarters.

As SooToday.com reported yesterday, ASI achieved a fourth-quarter profit of $10.l million, after two consecutive quarters of unprofitability.

Meeting today with local media, Turcotte nonetheless said that his company will proceeed with planned layoffs, with staffing levels possibly falling even lower than the 2,800 originally predicted for the end of 2004.

As of January 1, Algoma Steel had 2,892 employees, so at at last 92 additional layoffs can be expected by year's end.

"Nobody likes it," Turcotte said.

"But at least 19 out of 20 people support what's being done."

Contract negotiations

With its two collective agreements with the United Steelworkers of America (locals 2251 and 2724) due to expire at the end of July, Turcotte said that contract negotiations will be one of eight corporate priorities for the current quarter.

Turcotte says he's studying collective agreements at other companies to determine how well they've stood up against what he says are new realities of the steel industry.

In his previous career in the forest products industry, Turcotte once set out to find other difficult sectors.

His research, he says, disclosed that the only industry tougher than forst products was steel.

And his experience so far at Algoma Steel has not yet changed his mind about that.

Other corporate priorities

The following are Algoma Steel's eight first-quarter corporate priorities, as outlined by Turcotte today:

- organizational focus on margin improvement plan

- organizational development (leadership, integration, employee involvement)

- customer service

- communication (investment community, employees, customers)

- product mix (market opportunities, processing capability required)

- site configutation (continue assessing alternatives)

- contract negotiations

- contiuing to develop strategic relationships and alternatives

No. 7 blast furnace

Yesterday, SooToday.com reported how ASI's board has agreed to delay a planned reline of its No. 7 blast furnabce until 2010.

Last July, ASI announced that it had learned the $120 million maintenance project, originally scheduled for next year, could be safely put off until 2008, saving an estimated $90 million.

Today, Armando Plastino, vice-president of operations, told SooToday.com that deferring the reline a further two years could save an additional $8 million.

It's possible that No. 7 might be able to last beyond 2010 without the work, he said.

Other maintenance work

Plastino outlined the following maintenance operations that will nonetheless result in some downtime for the blast furnace:

- changing the tapholes next year

- rebricking the lower stack next year

- gunning the upper stack in 2008