Final Thoughts

Cliffs Provides Early Q1 Earnings Snapshot

Written by Laura Miller

April 11, 2023

Cleveland-Cliffs Inc. this week provided an early look into its first-quarter earnings – which the company will disclose in full detail on April 23.

Q1 steel shipments, revenues, and adjusted EBITDA are all expected to be higher than the prior quarter, the steelmaker said in a news release. At the same time, despite higher shipments, revenues and EBITDA will be significantly lower than Q1 2022.

Cliffs logo2.2

Steel shipments are expected to be 4.1 million net tons in Q1 — 7% higher sequentially and 13% higher year on year.

Q1 revenue expectations are $5.2 billion. This should be higher than the $5.0 billion posted in Q4 but lower than the $6.0 billion in Q1 2022 revenues.

The Cleveland-based steelmaker expects adjusted EBITDA to be approximately $200 million in Q1 compared to $123 million in Q4 and $1.5 billion in the year-ago quarter.

Cliffs’ chairman, president, and CEO Lourenco Goncalves said unit cost reductions were almost entirely responsible for the increase in Q1 profitability.

“As we start the second quarter and continue to execute on further cost reductions as planned, we are also enjoying the full benefits of the meaningful price increases Cleveland-Cliffs has implemented for this year, which cover contracts with automotive and non-auto clients, as well as transactional sales. With that, we expect Q2 EBITDA will be multiple times higher than Q1 EBITDA,” Goncalves added.

Cliffs has increased sheet prices seven times already this year, with the most recent increase announced on April 3 with the aim to raise hot-rolled coil pricing to $1,300 per ton.

By Laura Miller, laura@steelmarketupdate.com

Laura Miller

Laura Miller is a reporter and editor for Steel Market Update. She has held a variety of positions within the steel industry since 2007, including reporting and editing for Steel Business Briefing/Platts, the Association for Iron and Steel Technology, and Kallanish Commodities, as well as marketing for what was then known as ThyssenKrupp Steel USA (now AM/NS Calvert). After a five-year hiatus working across other industries, she returned to steel in 2021 and has covered the flat rolled, tubular, and trade areas of the industry. She is a member of the Association of Women in the Metal Industries and a past-president of the AWMI Pittsburgh Chapter. She holds a BA in Latin American Studies from Edinboro University of Pennsylvania. She can be reached at laura@steelmarketupdate.com or 724-759-7869.

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