Debt Ratings:

We maintain debt ratings with three of North America’s principal rating agencies to comply with various debt covenants and to assist in future financing activities.

Moody’s Investor’s Service’s rating was upgraded to Baa3 with a stable outlook from Ba1 with a positive outlook, on February 14, 2006. Obligations rated “Baa” are rated as being subject to moderate credit risk and are considered medium grade, and as such may possess certain speculative characteristics. The modifier “3” indicates that the obligation ranks in the lower end of its generic rating category. “Stable” defines Moody’s rating direction over the medium term. The “Corporate family rating” (also Baa3 stable) was withdrawn on February 15, 2006 as the Company is now an investment grade issuer.

Standard & Poor’s Ratings Services’ rating was upgraded to BBB- (stable) on November 30, 2006. An obligation rated ‘BBB’ exhibits adequate protection parameters. However, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity of the obligor to meet its financial commitments. The modifier “-” indicates that the obligation ranks in the lower end of its generic rating category. Stable means that the rating is not likely to change.

Dominion Bond Rating Service’s rating (DBRS) was upgraded to BBB with a stable outlook on June 12, 2006. Long-term debt rated BBB is of adequate credit quality. Protection of interest and principal is considered acceptable, but the entity is fairly susceptible to adverse changes in financial and economic conditions, or there may be other adverse conditions present which reduce the strength of the entity and its rated securities. The absence of either a “high” or “low” designation indicates the rating is in the “middle” of the category.

Capital Structure

We strive to maintain a strong balance sheet and a flexible capital structure. IPSCO has the ability to, and may elect to, use a portion of cash and cash equivalents to retire debt or to incur additional expenditures without increasing debt.

We consider our capital structure as of December 31, 2006 to be ($ millions):

Debt to total capitalization was 29.8% at December 31, 2006, an increase from 15.4% at December 31, 2005.

Quarterly Results:

Results by quarter for 2006 and 2005 were as follows:

(1)                Basic earnings per common share is calculated by dividing net income available to common shareholders by the weighted average number of common shares outstanding

(2)                Diluted earnings per share is calculated by dividing net income by the weighted average shares outstanding plus share equivalents that would arise from (a) the exercise of share options, deferred share units, restricted shares and performance units, and (b) the conversion of preferred shares and subordinated notes