Cleveland-Cliffs Inc. Files Q2 2024 10-Q Report

Ticker: CLF · Form: 10-Q · Filed: Jul 24, 2024 · CIK: 764065

Sentiment: neutral

Topics: 10-Q, earnings, metal-mining

Related Tickers: CLF

TL;DR

CLF Q2 10-Q filed. Financials and ops details out.

AI Summary

Cleveland-Cliffs Inc. filed its 10-Q for the period ending June 30, 2024. The filing covers the second quarter and first half of the fiscal year. Key financial data and operational details for the company, a major player in the metal mining industry, are presented.

Why It Matters

This filing provides investors and analysts with the latest financial performance and operational status of Cleveland-Cliffs Inc., crucial for understanding the company's trajectory in the metal mining sector.

Risk Assessment

Risk Level: medium — As a metal mining company, Cleveland-Cliffs Inc. is subject to market volatility, commodity prices, and operational risks inherent in the industry.

Key Numbers

Key Players & Entities

FAQ

What is the primary business of Cleveland-Cliffs Inc. according to the filing?

Cleveland-Cliffs Inc. is classified under METAL MINING [1000] according to its Standard Industrial Classification.

What is the SEC file number for this 10-Q filing?

The SEC file number for this 10-Q filing is 001-08944.

What is the fiscal year end for Cleveland-Cliffs Inc.?

The fiscal year end for Cleveland-Cliffs Inc. is December 31 (1231).

What period does this 10-Q report cover?

This 10-Q report covers the period ending June 30, 2024 (20240630).

When was this 10-Q filing submitted?

This 10-Q filing was submitted on July 24, 2024 (20240724).

Filing Stats: 4,909 words · 20 min read · ~16 pages · Grade level 16.2 · Accepted 2024-07-24 16:19:46

Key Financial Figures

Filing Documents

- FINANCIAL INFORMATION

PART I - FINANCIAL INFORMATION

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

ITEM 1. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 7

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 20

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 20

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 37

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 37

CONTROLS AND PROCEDURES 37

ITEM 4. CONTROLS AND PROCEDURES 37

- OTHER INFORMATION

PART II - OTHER INFORMATION

LEGAL PROCEEDINGS 38

ITEM 1. LEGAL PROCEEDINGS 38

RISK FACTORS 38

ITEM 1A. RISK FACTORS 38

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS 40

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS 40

MINE SAFETY DISCLOSURES 40

ITEM 4. MINE SAFETY DISCLOSURES 40

OTHER INFORMATION 40

ITEM 5. OTHER INFORMATION 40

EXHIBITS 41

ITEM 6. EXHIBITS 41 SIGNATURES 42 Table of Contents DEFINITIONS The following abbreviations or acronyms are used in the text. References in this report to the "Company," "we," "us," "our," "Cleveland-Cliffs" and "Cliffs" are to Cleveland-Cliffs Inc. and subsidiaries, collectively. Unless otherwise indicated, references to "$" is to United States currency. Abbreviation or acronym Term 7.000% 2032 Senior Notes 7.000% Senior Guaranteed Notes due 2032 issued by Cleveland-Cliffs Inc. on March 18, 2024 in an aggregate principal amount of $825 million ABL Facility Asset-Based Revolving Credit Agreement, dated as of March 13, 2020, among Cleveland-Cliffs Inc., the lenders party thereto from time to time and Bank of America, N.A., as administrative agent, as amended as of March 27, 2020, December 9, 2020, December 17, 2021, and June 9, 2023, and as may be further amended from time to time Adjusted EBITDA EBITDA, excluding certain items such as EBITDA of noncontrolling interests, Weirton indefinite idle, extinguishment of debt and other, net Arrangement Agreement Arrangement Agreement, by and between Stelco, Purchaser and Cleveland-Cliffs Inc., dated July 14, 2024 AOCI Accumulated other comprehensive income (loss) ASU Accounting Standards Update BOF Basic oxygen furnace CHIPS Act The Creating Helpful Incentives to Produce Semiconductors and Science Act of 2022 CO 2 e Carbon dioxide equivalent Dodd-Frank Act Dodd-Frank Wall Street Reform and Consumer Protection Act DOE U.S. Department of Energy EAF Electric arc furnace EBITDA Earnings before interest, taxes, depreciation and amortization EPA U.S. Environmental Protection Agency EPS Earnings per share EV Electric vehicle Exchange Act Securities Exchange Act of 1934, as amended FASB Financial Accounting Standards Board FMSH Act Federal Mine Safety and Health Act of 1977, as amended GAAP Accounting principles generally accepted in the United States GHG Greenhouse gas GOES Grain oriented elect

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

ITEM 1. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA CLEVELAND-CLIFFS INC. AND SUBSIDIARIES (In millions, except share information) June 30, 2024 December 31, 2023 ASSETS Current assets: Cash and cash equivalents $ 110 $ 198 Accounts receivable, net 1,773 1,840 Inventories 4,199 4,460 Other current assets 110 138 Total current assets 6,192 6,636 Non-current assets: Property, plant and equipment, net 8,728 8,895 Goodwill 1,005 1,005 Pension and OPEB assets 354 329 Other non-current assets 649 672 TOTAL ASSETS $ 16,928 $ 17,537 LIABILITIES AND EQUITY Current liabilities: Accounts payable $ 2,080 $ 2,099 Accrued employment costs 431 511 Accrued expenses 296 380 Other current liabilities 511 518 Total current liabilities 3,318 3,508 Non-current liabilities: Long-term debt 3,507 3,137 Pension and OPEB liabilities 757 821 Deferred income taxes 621 639 Other non-current liabilities 1,353 1,310 TOTAL LIABILITIES 9,556 9,415 Commitments and contingencies (See Note 17) Equity: Common shares - par value $ 0.125 per share Authorized - 1,200,000,000 shares (2023 - 1,200,000,000 shares); Issued - 531,051,530 shares (2023 - 531,051,530 shares); Outstanding - 468,038,839 shares (2023 - 504,886,773 shares) 66 66 Capital in excess of par value of shares 4,864 4,861 Retained earnings 1,668 1,733 Cost of 63,012,691 common shares in treasury (2023 - 26,164,757 shares) ( 1,154 ) ( 430 ) Accumulated other comprehensive income 1,666 1,657 Total Cliffs shareholders' equity 7,110 7,887 Noncontrolling interests 262 235 TOTAL EQUITY 7,372 8,122 TOTAL LIABILITIES AND EQUITY $ 16,928 $ 17,537 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 2 Table of Contents CLEVELAND-CLIFFS INC. AND SUBSIDIARIES Three Months Ended June 30, Six Months Ended June 30, (I

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS CLEVELAND-CLIFFS INC. AND SUBSIDIARIES NOTE 1 - BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES BUSINESS, CONSOLIDATION AND PRESENTATION The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with SEC rules and regulations and, in the opinion of management, include all adjustments (consisting of normal recurring adjustments) necessary to present fairly the financial position, results of operations, comprehensive income (loss), cash flows and changes in equity for the periods presented. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Management bases its estimates on various assumptions and historical experience, which are believed to be reasonable; however, due to the inherent nature of estimates, actual results may differ significantly due to changed conditions or assumptions. The results of operations for the three and six months ended June 30, 2024 are not necessarily indicative of results to be expected for the year ending December 31, 2024 or any other future period. Certain prior period amounts have been reclassified to conform with the current year presentation. These unaudited condensed consolidated financial statements should be read in conjunction with the financial statements and notes included in our Annual Report on Form 10-K for the year ended December 31, 2023. NATURE OF BUSINESS We are a leading North America-based steel producer with focus on value-added sheet products, particularly for the automotive industry. We are also a leading producer of electrical steels referred to as GOES and NOES in the U.S. We are vertically integrated from the mining of iron ore, production of pellets and direct reduced iron, and processing of ferrous scrap through primary steelmaking and downstream finishing,

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