February 16, 2011 / 10:46 PM / in 7 years

UPDATE 2-Miner Cliffs tops profit estimate, stock up 10 pct

* Q4 EPS $2.82 vs $2.16 expected by analysts

* Revenue rises 73 pct to $1.42 bln

* Shares rise nearly 10 pct (Adds CEO comment, Wall St comparison, updates share price)

SAN FRANCISCO, Feb 16 (Reuters) - Cliffs Natural Resources Inc CLF.N reported a better-than-expected surge in quarterly profit as demand and prices for its iron ore and steel-making coal soared, and its shares rose nearly 10 percent.

Chief Executive Joseph Carrabba said the growth stemmed from the mining company’s move to increase exposure to global pricing for its output, which was a big part of the strategy behind its pending $4 billion acquisition of Canada’s Consolidated Thompson Iron Mines CLM.TO. [ID:nN11154500]

Cliffs said its fourth-quarter net earnings were $384 million, or $2.82 per share, compared with $108 million, or 82 cents per share, in the quarter a year earlier.

That fourth-quarter EPS was well above analysts’ estimate of $2.16, according to Thomson Reuters I/B/E/S.

Revenue rose 73 percent to $1.42 billion from $821 million, the Cleveland-based company said on Wednesday.

The price of iron ore, a key ingredient for steelmaking, soared over 40 percent in 2010, due to tight Indian supplies and firm demand from top importer China. The acquisition of Consolidated could give Cliffs a foot in the door with Chinese buyers as it looks to boost its Asian business.

Prices of coking coal, another steelmaking ingredient, have also surged after massive flooding disrupted shipments and production in Australia.

The Cliffs share price had already more than doubled since hitting a 52-week low of $44.38 last July.

Following the earnings report, shares in Cliffs Natural Resources climbed 9.9 percent to $102.10 -- their highest level since August 2008 -- after closing at $92.88 on the New York Stock Exchange on Wednesday. (Reporting by Braden Reddall in San Francisco and Steve James in New York; Editing by Gary Hill)

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