On October 23, 2023, Cleveland-Cliffs Inc (CLF, Financial) released its third-quarter earnings report for the period ending September 30, 2023. The company reported a net income of $275 million, up from $165 million in Q3 2022. The company's revenues for Q3 2023 were $5.6 billion, slightly down from $5.7 billion in the same period last year.
Financial Highlights and Performance
Cleveland-Cliffs Inc (CLF, Financial) reported strong financial results for the third quarter of 2023. The company's net income stood at $275 million, or $0.52 per diluted share attributable to Cliffs shareholders. This included charges totaling $11 million, primarily related to acquisition-related costs, asset disposals, and severance. This compares to a net income of $165 million, or $0.29 per diluted share, in the third quarter of 2022.
The company's adjusted EBITDA for Q3 2023 was $614 million, up from $463 million in Q3 2022. The company also reported a cash flow from operations of $767 million and a free cash flow of $605 million. The company's net debt was reduced to $3.4 billion, and it reported record liquidity of $4.4 billion.
Cliffs’ Chairman, President and CEO Lourenco Goncalves said: “Q3 2023 was our third consecutive quarter with steel shipments above 4 million tons. We generated over $600 million in free cash flow in the quarter and, as we had announced we would do, we continued to use this strong cash generation to pay down debt and buy back shares. With that, our net debt and diluted share count have reached new record lows since our full transformation from a merchant mining to a steel company. Our liquidity is also now at an all-time high.”
Outlook
The company's previously laid out cost reduction objectives remain on target, and Cliffs currently expects another $15 per net ton reduction in steel unit costs from the third quarter to the fourth quarter of 2023, with additional cost reductions into 2024. Working capital is expected to provide a significant benefit to free cash flow in the fourth quarter of 2023. Cliffs also lowered its full-year 2023 capital expenditures expectation to $670 million, a reduction from the midpoint of its previous guidance range of $700 million.
About Cleveland-Cliffs Inc
Cleveland-Cliffs is the largest flat-rolled steel producer in North America. Founded in 1847 as a mine operator, Cliffs also is the largest manufacturer of iron ore pellets in North America. The Company is vertically integrated from mined raw materials, direct reduced iron, and ferrous scrap to primary steelmaking and downstream finishing, stamping, tooling, and tubing. Cleveland-Cliffs is the largest supplier of steel to the automotive industry in North America and serves a diverse range of other markets due to its comprehensive offering of flat-rolled steel products. Headquartered in Cleveland, Ohio, Cleveland-Cliffs employs approximately 27,000 people across its operations in the United States and Canada.
