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Press release from CNW Group

Algoma Central Corporation - Operating Results For the Three and Six Months Ended June 30, 2010 and 2009

Wednesday, August 04, 2010

Algoma Central Corporation - Operating Results For the Three and Six Months Ended June 30, 2010 and 200915:56 EDT Wednesday, August 04, 2010ALC-TTORONTO, Aug. 4 /CNW/ - << (In thousand of dollars except per share data) Three Months Ended Six Months Ended June 30 June 30 2010 2009 2010 2009 Revenue $ 154,613 $ 141,199 $ 212,457 $ 201,634 Net earnings (loss) $ 11,352 $ 13,509 $ (5,585) $ (4,944) Earnings (loss) per share $ 2.91 $ 3.47 $ (1.44) $ (1.27) Dividends paid per common share $ 0.45 $ 0.45 $ 0.90 $ 0.90 >> Second Quarter ResultsThe Corporation is reporting net earnings for the three months ended June 30, 2010 of $11,352 compared to $13,509 for the same period in 2009.The decrease in net earnings for the quarter ended June 30, 2010 of $2,157 when compared to the same prior year period was due primarily to a reduction in net foreign exchange gains that was partially offset with an improvement in operating earnings after income tax.The Domestic Dry-Bulk segment's operating earnings net of income tax increased by $5,253 due primarily to an increase in operating days, an improved freight mix and reduced spending on repairs and maintenance.The Product Tankers segment operating earnings net of income tax decreased by $1,081 due largely to reduced market rates for international operations and fewer operating days for the domestic operations resulting from reduced market demand. The reduction for the domestic tanker fleet was partially offset with increased operating earnings of the Algoma Dartmouth, which was purchased in January 2010.The Ocean Shipping segment operating earnings net of income tax decreased by $2,797 due to higher costs for regulatory dry-dockings and the effect of the lower average foreign exchange rate in 2010 compared to 2009 to convert earnings denominated in U.S. dollars to Canadian dollars. There were three planned and one unplanned regulatory dry-dockings in the second quarter of 2010 versus two planned regulatory dry-dockings for the same quarter in 2009.The Real Estate segment operating earnings net of income tax decreased by $135 due primarily to reduced occupancy at the shopping mall in Sault Ste. Marie.Net foreign exchange losses on the translation of foreign denominated assets and liabilities were $1,932 in the second quarter of 2010 compared to gains of $ 2,051 for the same quarter in 2009. The net foreign exchange losses and gains are due mainly to the translation of foreign-denominated net liabilities. In the 2010 second quarter, the Canadian dollar weakened against the U.S. dollar resulting in losses whereas in the second quarter of 2009, the Corporation incurred net foreign exchange gains due mainly to the strengthening of the Canadian dollar against the U.S. dollar.Six-Month ResultsFor the six months ended June 30, 2010, the Corporation is reporting an increase in the net loss of $641 to $5,585 compared to a net loss of $4,944 for the same period in the prior year. The operating loss net of income tax was lower in 2010 than 2009, however in 2010, there were net foreign exchange losses compared to gains in 2009, which more than offset the reduced operating loss.The Domestic Dry-Bulk segment's operating loss net of income tax decreased from $19,272 in 2009 to $11,674 in 2010 due primarily to more operating days, an improved freight mix and a decrease in repair and maintenance costs.The Product Tankers segment operating earnings net of income tax decreased by $1,371 due largely to reduced market rates for international operations and fewer operating days for the domestic operations resulting from reduced market demand. The reduction for the domestic tanker fleet was partially offset with increased operating earnings from the operations of the Algoma Dartmouth.The Ocean Shipping segment operating earnings net of income tax decreased by $3,544 due to higher costs for regulatory dry-dockings. There were three planned and one unplanned regulatory dry-dockings in 2010 versus two planned in 2009. Also contributing to the decrease was the effect of the lower average foreign exchange rate in 2010 versus 2009 to convert earnings denominated in U.S. dollars to Canadian dollars.The Real Estate segment operating earnings net of income tax decreased from $2,095 in 2009 to $1,373 in 2010 due primarily to reduced occupancy at the shopping mall in Sault Ste. Marie and an increase in expenses on the re-opening of the hotel operations.In 2009 to June 30, the net foreign exchange gains were $1,862 compared to a net loss of $1,251 for the similar period in 2010. The decrease of $3,113 is due primarily from the weakening of the Canadian dollar against the U.S. dollar in 2010 whereas in 2009 the Canadian dollar strengthened against the U.S. dollar.On July 7, 2010, the Board of Directors declared a dividend of $0.45 per common share payable on September 1, 2010 to shareholders of record on August 18, 2010.For further information: Greg D. Wight, FCA, President and Chief Executive Officer, 905-687-7850; David G. Allen, CA, Vice President, Finance and Chief Financial Officer, 905-687-7897