Cleveland-Cliffs (CLF) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenues were $5.1 billion, with steel shipments of 4.0 million net tons and adjusted EBITDA of $323 million.

• Net income was $9 million, with adjusted net income of $50 million and adjusted EPS of $0.11 per diluted share.

• Free cash flow was $362 million, and net debt was reduced by $237 million to $3.4 billion.

• Repurchased 7.5 million shares, reducing diluted share count to 474 million, and liquidity stood at $3.7 billion at quarter-end.

• Announced acquisition of Stelco, expected to close in Q4 2024, and repurposing of Weirton tinplate plant for transformer production.

Financial highlights

• Q2 2024 revenue was $5.1 billion, down from $6.0 billion in Q2 2023; adjusted EBITDA was $323 million, down from $775 million year-over-year.

• Steelmaking average selling price was $1,125/ton, down from $1,255 in Q2 2023.

• SG&A expenses decreased to $103 million from $162 million in Q2 2023.

• Free cash flow generation was $362 million, supported by ongoing inventory reduction.

• Liquidity at quarter-end was $3.7 billion.

Outlook and guidance

• Full-year 2024 capital expenditures guidance reduced to $650–$700 million.

• Steel unit costs expected to decrease by $30/ton year-over-year, with another $30/ton drop from Q2 to Q3.

• Q3 2024 steel shipments projected at approximately 4.0 million net tons.

• Expects further cost reductions and increased orders from automotive and service center customers in Q3.

• No specific ASP guidance due to market volatility, but management anticipates a sharp bounce back in pricing.