Iron ore miner and processor Cleveland-Cliffs reported a strong quarter and year in its annual report, released Friday.
For the full-year 2018, the company reported net income of $1.1 billion compared with net income of $363 million in the prior year. For the fourth quarter of 2018, Cliffs recorded net income of $610 million compared with net income of $310 million in the prior-year quarter.
The full-year net was earned on consolidated revenues of $2.3 billion compared to the prior year's revenues of $1.9 billion. Cost of goods sold and operating expenses were $1.5 billion, compared to $1.4 billion reported in 2017.
Fourth-quarter 2018 consolidated revenues were $696 million compared with prior-year fourth-quarter revenues of $512 million. Cost of goods sold and operating expenses were $494 million compared to $396 million reported in the fourth quarter of 2017.
“With over $1.1 billion in net income and a 67 percent increase in EBITDA year-over-year, we are proud to confirm that our strategic vision for the company has been fully implemented and is working very well. Transformations of this magnitude are complex, and can only be accomplished with a complete buy-in from all employees, managers, executives and directors. Our results confirm what we have accomplished here at Cleveland-Cliffs,” Chairman, President and Chief Executive Officer Lourenco Goncalves said in the annual report. “Our contribution as a supplier of environmentally friendly pellets and HBI makes Cliffs and the United States the models that other companies and other countries should follow. In 2019, we will make these points abundantly clear and fully understood by the American people."
Mining and pelletizing pellet sales volume in the fourth quarter was 6.5 million long tons, a 21 percent increase when compared with 5.4 million long tons sold in the fourth quarter of 2017. The increase was a result of a healthier customer demand and two additional customer contracts that did not exist in 2017. Conversely, fourth-quarter 2018 shipment volume was negatively impacted by unanticipated gale force winds in the Great Lakes, which limited shipping capabilities during October and November.
For 2019, Cliffs expects full-year sales and production volumes of approximately 20 million long tons. Cliffs' full-year 2019 mining and pelletizing cash cost of goods sold and operating expense expectation is $62 to $67 per long ton.
"2019 will be an even more exciting year for us. Our mining and pelletizing business will be once again sold out, and we look to produce yet another year of great results selling world class pellets at industry-high margins,” Goncalves said.