Canada's Algoma Central reports drop in Q1 revenues in 2025
Canadian shipping company Algoma Central Corporation has reported its results for the three months ended March 31, 2025.
Algoma reported revenues of CA$107.2 million (US$77.69 million), compared to revenues of CA$109.2 million (US$79.14 million) in 2024. Net loss for 2025 was CA$23.28 million (US$16.87 million) compared to a net loss of CA$17.25 million (US$12.5 million) for the same period in 2024.
Due to the closing of the canal system and the winter weather conditions on the Great Lakes – St. Lawrence Seaway, the majority of the domestic dry bulk fleet does not operate for most of the first quarter.
"Despite global economic uncertainties, Algoma remains steadfast in our commitment to delivering resilient service to our customers," said Gregg Ruhl, President and CEO of Algoma Central Corporation.
"Our ongoing investments in fleet enhancements and strategic growth reflect both our long-term vision and our confidence in the future.
"For the first time in Algoma’s history, we proudly took delivery of four vessels within a single quarter: Fure Vesborg, Algoma Endeavour, Algoma East Coast (pictured) and Algoma Acadian. These ships will serve key markets across Northern Europe, the Great Lakes, and the Canadian and US east coasts."
Performance by sector
The domestic dry bulk segment revenue decreased to CA$30.55 million (US$22.14 million) compared to CA$31.08 million (US$22.52 milion) in 2024. Despite a significant decrease in volumes, the impact to revenue was mitigated by the higher revenue days due to the mix of trades.
Operating loss increased four per cent to CA$37.16 million (US$26.93 million) compared to CA$35.61 million (US$25.81 million) in 2024, driven by higher lay-up costs due to four vessels in planned drydock versus one in the prior year period.
Revenue for product tankers decreased to CA$33.29 million (US$24.12 million) compared to CA$34.05 million (US$24.68 million) in 2024, primarily due to a reduction in revenue days resulting from an increase in drydockings this quarter, partially offset by the larger fleet size this year.
There was an operating loss of CA$378,000 (US$274,000) compared to operating earnings of CA$3.97 million (US$2.88 million) in 2024, reflecting higher layup spending and off-hire days due to the additional drydockings.
Revenue in the ocean self-unloaders segment decreased slightly to CA$42.73 million (US$30.97 million) compared to CA$43.2 million (US$31.3 million) in 2024. This decline was primarily due to a reduction in revenue days driven by increased off-hire time, as the result of higher drydocking days during the quarter.
Operating earnings decreased 23 per cent to CA$6.45 million (US$4.67 million) from CA$8.35 million (US$6.05 million) in 2024, reflecting a four per cent decrease in operating days driven primarily by the increased off-hire days.
Global short sea shipping segment equity earnings remained flat quarter-over-quarter, with earnings of CA$1.83 million (US$1.33 million) in 2025 compared to CA$1.83 million for the prior year period.
Earnings increased in the cement fleet driven by higher revenue days due to fewer drydockings, improved operating performance, and two additional vessels compared to the prior year, partially offset by increased dry-docking days in the mini-bulker fleet and exposure to market conditions and weather-delays in the handy-sized fleet.
"While reported revenues declined across several segments this quarter, much of the decrease was due to an increase in planned drydockings," said Christopher Lazarz, Chief Financial Officer at Algoma Central Corporation.
"Adjusting for these factors, core performance remained strong."
Business outlook
In the domestic dry bulk segment, the fleet is fully booked for the 2025 season. Demand is expected to be higher with the addition of significant new domestic steel industry business.
Shipments in the agriculture sector are expected to be strong, while the construction market is likely to remain flat.
Algoma expects customer demand in the product tankers segment to remain steady in 2025 and for fuel distribution patterns within Canada to support strong vessel utilisation for the vessels trading under the Canadian flag.
Algoma East Coast and Algoma Acadian are set to begin domestic operations during the second quarter. The fleet is expected to be in full deployment with all ten Canadian vessels in operation.
With the delivery of the first five newbuilds in 2024 and early 2025, five new tankers remain on order for the FureBear joint venture formed by Algoma and Swedish tanker operator Furetank Rederi with delivery expected between the second quarter of 2025 and early 2026. The company is anticipating a continued steady rate environment for these tankers.
In the ocean self-unloaders segment, five vessels in the Algoma fleet are scheduled for drydocking throughout 2025, which is expected to have a significant impact on available days. Demand for aggregate, gypsum, and salt is expected to increase, while coal shipments are projected to decline slightly.
Steel cutting for the hull of the second of three newbuild ocean self-unloaders took place in January 2025. The first of three new ocean self-unloaders is expected to be delivered in the third quarter of 2025. These new ships will replace Algoma's oldest vessels in the pool and become the model for its next generation of ocean self-unloaders.
In the global short sea shipping segment, Algoma anticipates steady earnings from the cement fleet, with most assets committed to long-term time charter contracts. The handy-size segment, together with the mini-bulk segment, are expected to perform at levels similar to 2024.
Two newbuild 9,500DWT bulk carriers are expected to be delivered into the NASC fleet in late 2025 and early 2026. These vessels will bring the newbuilds added to the mini-bulk fleet to six since 2020.
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, the company does not anticipate major changes in cargo volumes at this time; however, the company is also expecting higher costs across its supply chains, particularly for supplies and food, and is exploring ways to mitigate any potential impact.
