Cliffs Natural Resources reports smaller net loss year-on-year

JOHANNESBURG (miningweekly.com) – NYSE-listed iron-ore miner Cliffs Natural Resources has reported a net loss of $748-million for the full year ended December 31, 2015 – a smaller loss compared with the $8.3-billion net loss recorded in the prior year.

The 2015 full-year net loss attributable to Cliffs’ common shareholders of $788-million, or $5.13 per diluted share, compared with a net loss attributable to Cliff’s common shareholders of $7.3-billion, or $40.35 per diluted share recorded in 2014.

Cliffs also revealed in its fourth-quarter and full-year 2015 results, published on Wednesday, that its full-year consolidated revenues decreased by 40% to $2-billion from 2014’s full-year consolidated revenue of $3.4-billion.

Cliff’s cost of goods sold decreased by 29% to $1.8-billion compared with $2.5-billion reported in 2014.

Nevertheless, Cliffs chairperson Lourenco Goncalves said the company achieved substantial cost reductions in all areas of business, despite the severely negative impacts of global iron-ore and domestic steel prices.

“On top of an outstanding year of operating performance, we checked a number of boxes in line with US pellet-centric strategy, most recently with the full divestiture of our North American coal business,” he added.

The company’s US iron-ore cash production costs decreased by 26% to $45/t in the fourth quarter, while its Asia-Pacific iron-ore cash production costs decreased 40% to $26/t in the fourth quarter.

Meanwhile, the company’s consolidated revenues of $475-million in the fourth quarter reflected a 54% decrease from the prior year’s fourth-quarter revenue of $1.4-billion.

However, Cliffs reported a smaller fourth-quarter loss year-on-year of R58-million, compared with a net loss of R1.4-billion in the fourth quarter of 2014.

The company also achieved fourth-quarter adjusted earnings before interest, tax, depreciation and amortisation (Ebitda), of $76-million. This figure includes idle expenses of $30-million related to previously announced production curtailments. Excluding these idle expenses, associated with the United Taconite, Northshore and Empire mines, Cliffs’ adjusted Ebitda would have been $106-million.