Cliffs' Goncalves expects 2017 to be phenomenal.
Cliffs Natural Resources reported U.S. iron ore (USIO) pellet sales for the first quarter of 2017 of 3.1 million long tons, a 63% increase compared to the first quarter of 2016 (1 long ton = 1.12 short tons). "During the first quarter, we put our finishing touches on what has been a remarkable operational, commercial and financial transformation of this company," said Lourenco Goncalves, chairman, president and CEO, Cliffs. "Over the last two and half years, Cliffs has transformed itself into a lean and focused company, with a strong balance sheet and a lot less to pay in interest expense. This is particularly evident in our strong first quarter results ... We expect 2017 to be a phenomenal year of EBITDA and free cash flow generation."
The cash costs for USIO was $58.57/ long ton, a 7% decrease from $62.88/ long ton in the prior year's first quarter. The company attributed the decrease to having no idled active mines during the first quarter of 2017, compared to having two idled mines during the prior-year quarter.
First-quarter 2017 Asia Pacific iron ore (APIO) sales volume increased 9% to 3.0 million metric tons (mt), from 2.8 million mt in the first quarter of 2016 (1 mt = 1.1 st). The company said the volume increase was primarily related to the timing of shipments. Revenues of $54.35/mt increased by 32% compared to the prior-year quarter, driven by improved seaborne market prices.
Cash cost for APIO was $37.27/mt in the first quarter of 2017, a 15% increase from $32.42/mt in the prior-year quarter. The company attributed the higher cost to higher royalties, increased mining costs driven by a higher strip ratio, and an unfavorable exchange rate compared to the prior-year quarter.
Cliffs expects to produce more than 33 million tons of iron ore in 2017, includes 19 million long tons of USIO and 11.5 million mt of APIO.
Caption: A leaner, more-focused Cliffs expects to produce more than 33 million tons of iron ore in 2017.
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|Title Annotation:||NEWS-LEADING DEVELOPMENTS; Cliffs Natural Resources Inc.|
|Publication:||E&MJ - Engineering & Mining Journal|
|Article Type:||Brief article|
|Date:||May 1, 2017|
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