Mr. Michael Garcia reports

ALGOMA STEEL OUTLINES BEST AND FINAL OFFER IN COLLECTIVE AGREEMENT NEGOTIATIONS WITH USW LOCAL 2251

Algoma Steel Group Inc. has submitted its best and final collective bargaining agreement (CBA) offer to the negotiating committee of United Steelworkers Local Union 2251, the union representing Algoma's hourly employees.

Algoma Steel has also received notice that the 2251 negotiating committee has refused the offer and is unwilling to bring the offer to employee members for a vote. Should the 2251 negotiating committee maintain this position and impede its members from voting on the offer, which would require a short extension of the CBA to allow for a vote process, the company will be required to begin idling operations on July 31, 2022, to preserve the integrity of its assets. If operations are idled, it will take at least 10 days to ramp up the furnace and return to production.

Algoma Steel believes its offer to 2251 provides a compensation package that is superior to many of the company's peers in the industry, and includes numerous health and wellness benefit enhancements and protections offered by the company in an effort to reach an agreement.

Algoma Steel's offer contains improvements to the CBA including:

• Wage and cost of living increases totalling at least 12.6 per cent over three years plus increased afternoon, night and Sunday shift premiums;
• Increases to employee benefits that include:
  • Increase in the company's contributions to the defined contribution pension by a total of 45 cents per hour over three years;
  • Increase in major medical benefits, including lifetime maximum and visit allotments;
  • Increase in vision care;
  • Increase in dental benefits, including improvements to lifetime maximum for orthodontics and crown coverage;
  • Increase in short-term and long-term disability reduced earnings caps;
• Increase in retiree health benefits, including increased lifetime maximum and more for hearing aids and eyeglasses.

"We have been working in good faith to come to an agreement that is highly equitable to the members of the 2251 local, provides assurances of no job redundancies related to the electric arc transition during the term of this CBA and supports our collective future under the electric arc transformation," Algoma Steel president and chief executive officer Michael Garcia commented. "We must maintain a responsible balance that provides fair and equitable improvements to wages and benefits, in keeping with our competitors, while not overextending our cost structure, which would put the business at risk, particularly during low points in the economic cycle. A work stoppage with a reduction in production will have immediate adverse consequences for our company, customers, employees and the economic health of our community."

Mr. Garcia added: "In addition, an ongoing delay in our transformation may also have substantial economic and operational consequences, including significantly reducing the potential for profit-sharing this fiscal year. It will certainly impede our progress on both the plate mill modernization commissioning and the construction of the electric arc furnaces. We urge the 2251 negotiating committee to give its membership the opportunity to vote on the offer and to work past the CBA deadline to allow the appropriate amount of time to do so."

The current agreement will expire as of 12:01 a.m. on Aug. 1, 2022.

About Algoma Steel Group Inc.

Based in Sault Ste. Marie, Ont., Canada, Algoma Steel is a fully integrated producer of hot- and cold-rolled steel products, including sheet and plate. With a current raw steel production capacity of an estimated 2.8 million tons per year, Algoma Steel's size and diverse capabilities enable it to deliver responsive, customer-driven product solutions straight from the ladle to direct applications in the automotive, construction, energy, defence and manufacturing sectors. Algoma Steel is a key supplier of steel products to customers in Canada and Midwest United States, and is the only producer of plate steel products in Canada. The company's mill is one of the lowest-cost producers of hot-rolled sheet steel (HRC) in North America owing in part to its state-of-the-art direct strip production complex (DSPC), which is the newest thin slab caster in North America with direct coupling to a basic oxygen furnace (BOF) melt shop.

Algoma Steel has achieved several meaningful improvements over the last several years that are expected to result in enhanced long-term profitability for the business. Algoma Steel has upgraded its DSPC facility and recently installed its No. 2 ladle metallurgy furnace. Additionally, the company has cost-cutting initiatives under way and is in the process of modernizing its plate mill facilities.

Today, Algoma Steel is on a transformation journey. Algoma Steel is investing in its people and processes, optimizing and modernizing to secure a sustainable future. Its customer focus, growing capability and courage to meet the industry's challenges head-on position it firmly as your partner in steel.

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