Champion Iron Ore’s finances strained in first quarter

During the period, direct reduction-quality iron-ore was produced from the direct reduction pellet feed (DRPF) project at its Bloom Lake mine, in Québec, with the first shipment expected to be completed in the September quarter.

Champion completed the DRPF project within its recently estimated $500-million budget, with cumulative investments totalling $493.7-million at period-end.

The company secured a commercial agreement for a portion of near-term production capacity, while advancing discussions with additional prospective customers.

During the quarter under review, Champion also completed the acquisition of Norway-based high-purity iron-ore producer Rana Gruber.

The quarterly production of 3.9-million wet metric tonnes of high-purity iron-ore concentrates represents a 12% increase over the same prior-year period, primarily attributable to the acquisition of Rana Gruber (400 000 wmt), while Bloom Lake continued to deliver to expectation (3.5-million wet metric tonnes).

Quarterly sales totalled 3.3-million dry metric tonnes of high-purity iron-ore concentrates (3.1-million dry metric tonnes and 200 000 dmt from Bloom Lake and Rana Gruber, respectively), a decrease of 13%, primarily reflecting the planned transition and shipment sequencing associated with the DRPF ramp-up at Bloom Lake, and partially offset by sales from Rana Gruber’s operations.

“In an environment marked by economic uncertainty and market volatility, our dedicated team remains focused on executing our strategic priorities and optimising operations to enhance our competitive positioning and financial resilience,” CEO David Cataford highlights.

“The completion of the DRPF project once again demonstrates our ability to successfully deliver large-scale projects, enabling us to engage with new customers, further participate in decarbonising the steel industry and improve our realised prices.

“As we complete the integration of Rana Gruber, our focus shifts towards unlocking opportunities across our businesses, including cost management initiatives, while continuing to implement our long-term vision and strengthen Champion’s position as a leading global supplier of high-purity iron-ore,” he adds.

Meanwhile, the company’s financial results for the quarter were impacted on by the timing of iron-ore shipments associated with DRPF commissioning activities, which deferred a portion of revenues and related net income, Ebitda and cash flows from operating activities to future periods, as well as by higher freight and fuel and lower fixed cost absorption, Champion points out.

The company recorded a net loss of $41.5-million, representing a loss a share of $0.07, compared with net income of $23.2-million and earnings per share (EPS) of $0.04 recorded in the quarter ended March 31, and net income of $23.8-million with EPS of $0.05 recorded for the June 2025 quarter.

The net loss was primarily driven by an unrealised foreign exchange loss of $17.2-million on net monetary liabilities denominated in foreign currencies, as well as unfavourable fair value adjustments of $17.6-million on derivative instruments.

Ebitda of $32.8-million, compared with $114.3-million in the March quarter and $57.8-million in the June 2025 quarter, was negatively impacted by several factors. This included timing of sales; unfavourable changes in fair value of derivative instruments of $17.6-million, which also impacted net loss; DRPF startup costs of $6.6-million; and inventory valuation adjustments in relation to the acquisition of Rana Gruber of $2.9-million.

Revenue of $356.9-million was lower than the $390-million reported for the June 2025 quarter, despite the inclusion of $23.9-million of revenues from Rana Gruber following the acquisition completed on April 10 this year.

Excluding the acquisition of Rana Gruber, lower revenues were mainly attributable to Bloom Lake’s lower sales volumes during the period, compared with the same period in 2025.

Bloom Lake’s sales volumes were affected by the timing of vessel shipments, as vessel bookings reflected lower anticipated volumes transported to the Port of Sept-Îles during the DRPF project ramp-up period.

The increase in the gross average realised selling price offset the rise in freight costs during the period when compared with the previous period.

Available liquidity remained robust at $653.1-million at period-end, compared with $812.4-million as at March 31.

Champion also entered into a new term loan under the company’s syndicated senior credit facilities to finance the acquisition of Rana Gruber and extended the maturity of the existing $400-million senior revolving credit facility to April 2030.

No serious workplace injuries and no major environmental incidents were reported during the quarter under review.