Algoma Central Corporation - Operating Results For the Three and Twelve Months Ended December 31, 2008 and 2007


    TORONTO, Feb. 18 /CNW/ -

                         ALGOMA CENTRAL CORPORATION

                              Operating Results

       For the Three and Twelve Months Ended December 31, 2008 and 2007

               (In thousand of dollars except per share data)

                                        Three Months         Twelve Months
                                           Ended                Ended
                                         December 31          December 31
                                      2008       2007       2008       2007

    Revenue                       $ 196,402  $ 185,134  $ 688,914  $ 580,546

    Net earnings                  $  16,832  $  26,077  $  41,280  $  52,443

    Earnings per share            $    4.33  $    6.70  $   10.61  $   13.48

    Dividends paid per common
     share                        $    0.45  $    0.35  $    1.70  $    1.40


    The Corporation is reporting net earnings for the three months ended
December 31, 2008 of $16,832 compared to $26,077 for the same period in 2007.
This decrease in net earnings of $9,246 was due primarily to the following:

      - Decreases in the earnings of Ocean Shipping segment due to reduced
        results from the self-unloader commercial arrangement.

      - Decrease in earnings of the Product Tanker segment due primarily to
        lower than expected results for the Algoma Hansa.

      - Increase in net foreign exchange losses resulting primarily from the
        translation to Canadian dollars of U.S. dollar denominated debt due
        to the weakening of the Canadian dollar.

      - A reduction of income tax expense in 2007 of $5,570 due to lower
        future corporate income tax rates.

    For the twelve months ended December 31, 2008, the Corporation is
reporting net earnings of $41,280 compared to net earnings of $52,443 for
    The decrease in net earnings was primarily due to foreign exchange losses
incurred in 2008 compared to foreign exchange gains recorded in 2007 and a tax
benefit recorded in 2007 for the reduction in future income tax rates.
Earnings from operations, net of income tax and earnings of non-controlling
interest, increased by 4% from 2007 from 2008 due primarily to the following:

      -  The Domestic Dry-Bulk segment earnings improved as higher freight
         rates and additional operating days for the bulk carriers more than
         offset higher operating costs primarily due to lay-up spending.
         Higher fuel costs were recovered through fuel surcharges.

      -  The improved earnings for the Ocean Shipping segment were a result
         of improved earnings from the self-unloader commercial arrangement,
         strong earnings from positioning cargos for vessels having scheduled
         regulatory dry-dockings performed in China and operation for the
         full year of the Honourable Henry Jackman which entered service
         August 1, 2007. Partially offsetting these improvements was an
         increase in scheduled regulatory dry-dock costs.

      -  The Real Estate segment earnings were up slightly for 2008 due to
         the gain on sale of a light industrial building and increased rental

    Partially offsetting the improvements in the previous three segments were
the following:

      -  Decrease in the earnings of the Product Tankers segment due to the
         costs and reduced revenue associated with the scheduled regulatory
         dry-dock of the Algoma Hansa

      -  Amortization expense has increased as a result of a full year charge
         for the Honourable Henry Jackman, the addition of the three geared
         ocean bulk carriers, and the amortization of the investment in the
         life extensions of the John B. Aird and the Algolake.

    The Corporation recently concluded an agreement to terminate the lease
with the tenant of our Sault Ste. Marie hotel property. We assumed control of
the property on February 1, 2009 and the hotel is now operating as the
Waterfront Inn and Conference Centre. We plan to spend approximately six
million dollars on a modernization program which will include building
improvements and new furnishings and fixtures. The Waterfront Inn and
Conference Centre will continue to operate as a first-class, full service
hotel and coincident with this modernization program the hotel will be

For further information:

For further information: Greg D. Wight, President and Chief Executive
Officer, (905) 687-7850; David G. Allen, Vice President, Finance and Chief
Financial Officer, (905) 687-7897

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Algoma Central Corporation

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