Cleveland-Cliffs Reports Q3 Results: $12.1B Sales, $1.1B Net Loss

Ticker: CLF · Form: 10-Q · Filed: Nov 5, 2024 · CIK: 764065

Sentiment: bearish

Topics: financials, earnings, loss, steel

TL;DR

Cliffs Q3: $12.1B sales, but a $1.1B net loss. Ouch.

AI Summary

Cleveland-Cliffs Inc. filed its 10-Q for the period ending September 30, 2024. The company reported total assets of $23.3 billion and total liabilities of $12.3 billion as of September 30, 2024. For the nine months ended September 30, 2024, net sales were $12.1 billion, with a net loss of $1.1 billion.

Why It Matters

This filing provides insight into Cleveland-Cliffs' financial performance and position, including significant sales figures and a net loss, which could impact investor confidence and future strategic decisions.

Risk Assessment

Risk Level: medium — The company reported a substantial net loss for the nine-month period, indicating potential financial strain or significant investment impacting profitability.

Key Numbers

Key Players & Entities

FAQ

What were Cleveland-Cliffs' total assets and liabilities as of September 30, 2024?

As of September 30, 2024, Cleveland-Cliffs Inc. reported total assets of $23.3 billion and total liabilities of $12.3 billion.

What were the net sales for Cleveland-Cliffs for the nine months ended September 30, 2024?

For the nine months ended September 30, 2024, Cleveland-Cliffs reported net sales of $12.1 billion.

What was the net income or loss for Cleveland-Cliffs for the nine months ended September 30, 2024?

Cleveland-Cliffs reported a net loss of $1.1 billion for the nine months ended September 30, 2024.

When was the company formerly known as CLIFFS NATURAL RESOURCES INC.?

The company's name changed from CLIFFS NATURAL RESOURCES INC. to CLEVELAND CLIFFS INC. on October 15, 2008.

What is Cleveland-Cliffs' fiscal year end?

Cleveland-Cliffs Inc.'s fiscal year ends on December 31.

Filing Stats: 4,948 words · 20 min read · ~16 pages · Grade level 15.4 · Accepted 2024-11-05 16:09:54

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 23

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 23

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 38

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 38

CONTROLS AND PROCEDURES 38

ITEM 4. CONTROLS AND PROCEDURES 38

- OTHER INFORMATION

PART II - OTHER INFORMATION

LEGAL PROCEEDINGS 40

ITEM 1. LEGAL PROCEEDINGS 40

RISK FACTORS 40

ITEM 1A. RISK FACTORS 40

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 41

ITEM 4. MINE SAFETY DISCLOSURES 41

OTHER INFORMATION 41

ITEM 5. OTHER INFORMATION 41

EXHIBITS 42

ITEM 6. EXHIBITS 42 SIGNATURES 43 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 and August 16, 2024 in an aggregate principal amount of $1,425 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, June 9, 2023, July 31, 2024, and September 13, 2024, 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, acquisition-related costs and adjustments, arbitration decision, 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 Bridge Facility Financing arrangement contemplated by the Commitment Letter under which Cleveland-Cliffs Inc. had the option to borrow certain funds in relation to the Stelco Acquisition CHIPS Act The Creating Helpful Incentives to Produce Semiconductors and Science Act of 2022 CO 2 e Carbon dioxide equivalent Commitment Letter Commitment Letter, dated as of July 14, 2024, pursuant to which Wells Fargo Bank National Association, Wells Fargo Securities, LLC, and JP Morgan Chase Bank, N.A. committed to providing Cleveland-Cliffs Inc. with financing under a Bridge Facilit

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

ITEM 1. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA CLEVELAND-CLIFFS INC. AND SUBSIDIARIES (In millions, except share information) September 30, 2024 December 31, 2023 ASSETS Current assets: Cash and cash equivalents $ 39 $ 198 Accounts receivable, net 1,583 1,840 Inventories 4,236 4,460 Other current assets 169 138 Total current assets 6,027 6,636 Non-current assets: Property, plant and equipment, net 8,687 8,895 Goodwill 1,005 1,005 Pension and OPEB assets 378 329 Other non-current assets 699 672 TOTAL ASSETS $ 16,796 $ 17,537 LIABILITIES AND EQUITY Current liabilities: Accounts payable $ 1,983 $ 2,099 Accrued employment costs 413 511 Accrued expenses 379 380 Other current liabilities 480 518 Total current liabilities 3,255 3,508 Non-current liabilities: Long-term debt 3,774 3,137 Pension and OPEB liabilities 666 821 Deferred income taxes 567 639 Other non-current liabilities 1,439 1,310 TOTAL LIABILITIES 9,701 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 - 468,067,482 shares (2023 - 504,886,773 shares) 66 66 Capital in excess of par value of shares 4,875 4,861 Retained earnings 1,426 1,733 Cost of 62,984,048 common shares in treasury (2023 - 26,164,757 shares) ( 1,153 ) ( 430 ) Accumulated other comprehensive income 1,640 1,657 Total Cliffs shareholders' equity 6,854 7,887 Noncontrolling interests 241 235 TOTAL EQUITY 7,095 8,122 TOTAL LIABILITIES AND EQUITY $ 16,796 $ 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 September 30, Nine Months Ended Sep

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 nine months ended September 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 finis

View Full Filing

View this 10-Q filing on SEC EDGAR

View on Read The Filing