Stelco Holdings Inc. reported its fourth-quarter earnings Wednesday with declines in revenue and profit, as its chief executive said the company faced multiple headwinds which are no longer in place. 

According to a news release from Stelco Holdings Wednesday, the company reported $674 million in revenue during the fourth quarter, down 20 per cent from the previous quarter and 43 per cent year-over-year. Net income came in at $23 million during the quarter, down 85 per cent from the third quarter and 96 per cent year-over-year. 

“The fourth quarter was challenged by lower sales prices, shorter lead times and higher costs primarily due to increased input costs, a ‘triple whammy,’” Alan Kestenbaum, the chairman and chief executive officer of Stelco Holdings, said in the news release. 

In a television interview with BNN Bloomberg on Thursday, Kestenbaum said despite challenges in the fourth quarter, 2022 was the second most profitable year in the company’s history, second only to 2021. 

“In the fourth quarter…things changed. There was a perception of a recession coming. Customers lowered their demand, they lowered their purchases, prices dropped, lead times of mills shrank,” Kestenbaum said, adding that those customers appear to have misread the economic environment.

In the industries Stelco serves, including oil and gas, demand has now rebounded, according to Kestenbaum. He said the company is currently sold out for the first quarter of this year and nearly 50 per cent sold out for the second quarter. 

Amid economic uncertainty, Kestenbaum said he does not anticipate that a recession will take place in 2023.

“Recessions are caused by monetary policy, which the U.S. Federal Reserve is certainly working on, but it's also caused by increases in unemployment and a cutback in government spending. We're not seeing that, it's the opposite. We're seeing very strong government spending. We're seeing unemployment remain very low,” he said. 

On the monetary policy side, Kestenbaum said he thinks the Fed will “give up” on its inflation-fighting campaign and settle for an approximately four per cent target instead of its current two per cent target. 

“We're anticipating pretty strong 2023 and 2024 as interest rates probably start to head back downward,” he said. 

In its latest earnings report, Stelco also declared a quarterly dividend that will be payable on March 9 of $0.42 per share.