Miner Cliffs reports loss on weaker commodity prices, volumes

Wed Jul 23, 2014 7:32pm EDT
 
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(Reuters) - Cliffs Natural Resources Inc, facing off against an activist fund that wants to replace its chief executive, reported a bigger-than-expected quarterly loss on Wednesday because of weak commodity prices and a decline in sales volumes.

The Cleveland-based iron ore and metallurgical coal producer slightly lowered its forecast for full-year sales and production volume for U.S. iron ore to 22 million tons because of icy winter weather, which hampered shipments. The new forecast is at the lower end of a previous forecast of 22 million to 23 million tons.

However, it slightly raised its outlook for iron ore sales and production volumes in Eastern Canada and Asia.

The company also trimmed its coal sales and production volume forecast to 7 million tons from between 7 million and 8 million tons because of the potential idling of its Pinnacle mine in West Virginia.

Cliffs shares fell 2 percent in after-hours trade to $15.14.

Cliffs reported a net loss of $2 million, or 1 cent a share, for the second quarter, compared with a profit of $133 million, or 82 cents a share, in the quarter a year earlier.

Excluding one-time items, Cliffs lost 16 per cents per share, Citi analyst Brian Yu said in a note to clients.

That compared with a loss of 8 cents a share that analysts had been expecting, according to Thomson Reuters I/B/E/S.

Revenue fell 26 percent in the quarter to $1.1 billion, on lower prices for iron ore and metallurgical coal, as well as a 24 percent decrease in sales volume from the company's U.S. iron ore operations.   Continued...