Cleveland-Cliffs' Q4 Earnings Miss Estimates, Revenues Beat

Cleveland-Cliffs Inc.’s CLF fourth-quarter 2024 adjusted loss was 68 cents per share compared with a loss of 5 cents in the prior-year quarter. It was wider than the Zacks Consensus Estimate of a loss of 65 cents.

Revenues decreased around 15.4% to $4,325 million from the year-ago quarter. The top line, however, beat the Zacks Consensus Estimate of $4,313.4 million.

CLF’s Operational Highlights

The company reported Steelmaking revenues of $4,168 million for the fourth quarter, down around 15.8% year over year. The figure missed our estimate of $4,198.3 million.

The average net selling price per net ton of steel products was $976 in the quarter, down around 10.7% year over year. It lagged our estimate of $985. 

External sales volumes for steel products were roughly 3.83 million net tons, down around 5.2% year over year. It beat our estimate of 3.82 million net tons.

CLF’s FY24 Results

Full-year 2024 loss (as reported) was $1.57 per share against earnings of 78 cents a year ago. Revenues declined roughly 12.8% to $19,185 million in the full year. 

CLF’s Financial Position

Cleveland-Cliffs ended the fourth quarter with cash and cash equivalents of $54 million, down from $198 million in the prior-year quarter. Long-term debt increased 125.2% year over year to $7,065 million.

Net cash used by operating activities was $472 million in fourth-quarter 2024.

CLF’s Outlook

The company expects a reduction of approximately $40 per net ton in steel unit costs in 2025 compared with 2024. Capital expenditures are projected to total around $700 million. Selling, general and administrative expenses are anticipated to reach approximately $625 million. Depreciation, depletion, and amortization (DDA) expenses are forecasted at roughly $1.1 billion. Additionally, cash pension and other post-employment benefits (OPEB) payments are projected to be around $150 million.

CLF’s Price Performance

Shares of CLF are down 45% in the past year compared with a 5.3% decline of its industry.

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CLF’s Zacks Rank & Key Picks

CLF currently carries a Zacks Rank #4 (Sell).

Better-ranked stocks worth a look in the basic materials space include ICL Group Ltd.  ICL, Fortuna Mining Corp. FSM and Kronos Worldwide KRO.

ICL is slated to report fourth-quarter results on Feb. 26. The Zacks Consensus Estimate for fourth-quarter earnings is pegged at 6 cents. ICL beat the Zacks Consensus Estimate in each of the last four quarters, with the average earnings surprise being 18.1%. ICL carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Fortuna is scheduled to release fourth-quarter results on March 5. The Zacks Consensus Estimate for FSM’s fourth-quarter earnings is pegged at 16 cents. FSM, a Zacks Rank #2 stock, has gained around 64.6% in the past year. FSM beat the Zacks Consensus Estimate in two of the last four quarters, while missing twice with the average earnings surprise being 53.5%

Kronos is expected to report fourth-quarter results on March 5. The consensus estimate for KRO’s fourth-quarter earnings is pegged at 11 cents. KRO, carrying a Zacks Rank #2, beat the consensus estimate in three of the last four quarters while missing once, with the average earnings surprise being 41.7%. 

 

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This article originally published on Zacks Investment Research (zacks.com).

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