Replies to post #27793 on The Rising Influence of Rising Affluence

[jbog]

Dew

Seems like a lot of work to move so much metal and end up with squat. And what happens if the market turns?

[DewDiligence]

Addendum—CLF forecasts US 2023 auto sales of 15.5M, up substantially from 2022. (As a rule of thumb, each new car equates to about one ton of steel.)

[DewDiligence]

CLF’s CEO bought $1.5M of_stock_on_the_open_market_today:

https://www.sec.gov/Archives/edgar/data/764065/000076406523000085/xslF345X04/wf-form4_168261061060009.xml

Lorenco Goncalves announced on CLF’s CC two days ago that CLF’s stock was undervalued and that he would be buying shares for his own account as soon as his trading window opened. Now he’s followed through.

All told, LG owns 5.5M CLF shares, worth about $83M at the current market price.

[DewDiligence]

CLF reports 2Q23 results:

https://www.clevelandcliffs.com/investors/news-events/press-releases/detail/599/cleveland-cliffs-reports-second-quarter-2023-results

• Revenues of $6.0 billion [-6% YoY, +13% QoQ] [Note: 2Q22 was the highest-ever revenue quarter for CLF, so 2Q23 was a tough comparison.]

• Steel shipments of 4.2 million net tons [+17% YoY, +2% QoQ]

• Net income of $356 million [-41% YoY, NMF QoQ]

• Adjusted EBITDA of $775 million [-30% YoY, +219% QoQ]

• Cash flow from operations of $887 million [+66% YoY, NMF QoQ]

• Net debt down to $3.9 billion [down from $4.5B @3/31/23]

• Total liquidity of $3.8 billion [up from $3.1B @3/31/23], highest in Company history

2Q23 GAAP EPS was $0.67 [vs $1.13 in 2Q22 and a loss in 1Q23].

Most of the 2Q23 free cash flow of $756M was used to pay down debt.

Prior cost-cutting guidance remains on track with a COGS reduction of $40/ton in 3Q23 and an additional $10/ton in 4Q23.

I’ll have more to say after the CC Tuesday morning.