Cleveland-Cliffs Reports Mixed Q2 Earnings, Investors Focus on Strong Free Cash Flow Generation, Continued Cost-Cutting Initiative – Cleveland-Cliffs (NYSE:CLF)

Cleveland Cliffs Inc KLF reported its second-quarter financial results after the market closed on Monday. Here’s a look at key metrics from the quarter.

Q2 earnings: Cleveland-Cliffs reported second-quarter revenue of $5.1 billion, missing consensus estimates of $5.1 billion, according to Benzinga Pro. The company reported breakeven adjusted earnings, beating analyst estimates for a loss of 2 cents per share.

Steel shipments totaled 4 million net tons in the second quarter. Cash flow from operations was $519 million in the quarter, while free cash flow was $362 million.

Cleveland-Cliffs said it repurchased 7.5 million shares under its previously authorized $1.5 billion share repurchase program during the second quarter. The company’s total liquidity as of June 30 was $3.7 billion.

“Despite sub-optimal steel demand and weak pricing throughout the quarter, Cliffs performed very well. We achieved our cost reduction target and shipped the tonnage we had planned. This allowed us to pay down more than $200 million of debt and return approximately $125 million to our shareholders through share buybacks,” he said. Lourenco GoncalvesChairman of the Board, CEO, Cleveland-Cliffs.

Perspectives: Cleveland-Cliffs lowered its full-year 2024 capital expenditures guidance range from $675 million to $725 million to a new range of $650 million to $700 million. The company also noted that its year-over-year steel unit cost reduction target of approximately $30 per net ton remains on track.

“Looking ahead, we expect to benefit from another strong cost reduction in the third quarter. Our largest end market, the automotive sector, remains in good shape, and orders from service center customers are likely to increase as seaborne steel imports dry up,” Goncalves said.

Management will hold a conference call to discuss quarterly results on Tuesday morning at 8:30 a.m. Eastern Time.

CLF price action: At the time of publication, Cleveland-Cliffs shares were up 3.02% after closing at $15.85, according to Benzinga Pro.

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