Cleveland-Cliffs Completes the Sale of its Asia Pacific Iron Ore Assets
Cleveland-Cliffs Inc. (NYSE: CLF) (“Cliffs” or the “Company”) announced today that it has closed the sale of its Asia Pacific
Iron Ore assets to Mineral Resources Limited (“MRL”). With the transaction, Cliffs’ previously disclosed costs of closing the
Australian operations were reduced by approximately $85 million. Included in this amount are asset retirement obligations
assumed by MRL.
As a result of the transaction, in the third quarter Cliffs will be recording a reversal of its currency translation adjustment,
which will result in a positive contribution to net income of approximately $230 million, or income of approximately $0.75 per
diluted share.
Lourenco Goncalves, Cliffs' Chairman, President and Chief Executive Officer said, "With the closure of the sale of the
Australian assets, we have now completed our multi-year transformation back to our roots as a supplier of high-grade iron units to
the Great Lakes steel industry." Mr. Goncalves added: "I must again thank our APIO team for their crucial role and contribution to
our successful turnaround over the last four years. This positive attitude and full engagement of our entire workforce will
continue to allow us to be successful as we grow and evolve to supply high quality metallics to electric arc furnaces.”
About Cleveland-Cliffs Inc.
Founded in 1847, Cleveland-Cliffs Inc. is the largest and oldest independent iron ore mining company in the United States. We
are a major supplier of iron ore pellets to the North American steel industry from our mines and pellet plants located in Michigan
and Minnesota. By 2020, Cliffs expects to be the sole producer of hot briquetted iron (HBI) in the Great Lakes region with the
development of its first production plant in Toledo, Ohio. Driven by the core values of safety, social, environmental and capital
stewardship, our employees endeavor to provide all stakeholders with operating and financial transparency. For more information,
visit
http://www.clevelandcliffs.com.
Forward-Looking Statements
This release contains statements that constitute "forward-looking statements" within the meaning of the federal securities laws.
As a general matter, forward-looking statements relate to anticipated trends and expectations rather than historical matters.
Forward-looking statements are subject to uncertainties and factors relating to Cliffs’ operations and business environment that
are difficult to predict and may be beyond our control. Such uncertainties and factors may cause actual results to differ
materially from those expressed or implied by the forward-looking statements. These statements speak only as of the date of this
release, and we undertake no ongoing obligation, other than that imposed by law, to update these statements. Uncertainties and risk
factors that could affect Cliffs’ future performance and cause results to differ from the forward-looking statements in this
release include, but are not limited to: uncertainty and weaknesses in global economic conditions, including downward pressure on
prices caused by oversupply or imported products, reduced market demand and risks related to U.S. government actions with respect
to Section 232 of the Trade Expansion Act (as amended by the Trade Act of 1974), the North American Free Trade Agreement and/or
other trade agreements, treaties or policies; continued volatility of iron ore and steel prices and other trends, including the
supply approach of the major iron ore producers, affecting our financial condition, results of operations or future prospects,
specifically the impact of price-adjustment factors on our sales contracts; our ability to cost-effectively achieve planned
production rates or levels, including at our HBI production plant; our ability to successfully identify and consummate any
strategic investments or development projects, including our HBI production plant; the impact of our customers reducing their steel
production due to increased market share of steel produced using other methods or lighter-weight steel alternatives; risks related
to former international operations, including our ability to successfully conclude the CCAA process in Canada and to
close our Asia Pacific business in a manner that minimizes cash outflows and associated liabilities, including, among
other things, our ability to successfully complete the sale of the assets of our Asia Pacific Iron Ore business and our ability to
reach negotiated settlements with other third parties in Australia; our ability to successfully diversify our product mix and add
new customers beyond our traditional blast furnace clientele; our actual economic iron ore reserves or reductions in current
mineral estimates, including whether any mineralized material qualifies as a reserve; our ability to maintain appropriate relations
with unions and employees; the outcome of any contractual disputes with our customers, joint venture partners or significant
energy, material or service providers or any other litigation or arbitration; the ability of our customers and joint venture
partners to meet their obligations to us on a timely basis or at all; problems or uncertainties with productivity, tons mined,
transportation, mine-closure obligations, environmental liabilities, employee-benefit costs and other risks of the mining industry;
our ability to reach agreement with our customers regarding any modifications to sales contract provisions, renewals or new
arrangements; our actual levels of capital spending; our level of indebtedness could limit cash flow available to fund working
capital, capital expenditures, acquisitions and other general corporate purposes or ongoing needs of our business; availability of
capital and our ability to maintain adequate liquidity; changes in sales volume or mix; events or circumstances that could impair
or adversely impact the viability of a mine and the carrying value of associated assets, as well as any resulting impairment
charges; impacts of existing and increasing governmental regulation and related costs and liabilities, including failure to receive
or maintain required operating and environmental permits, approvals, modifications or other authorization of, or from, any
governmental or regulatory entity and costs related to implementing improvements to ensure compliance with regulatory changes;
uncertainties associated with natural disasters, weather conditions, unanticipated geological conditions, supply or price of
energy, equipment failures and other unexpected events; adverse changes in currency values, currency exchange rates, interest rates
and tax laws; and the potential existence of significant deficiencies or material weakness in our internal control over financial
reporting.
For additional factors affecting the business of Cliffs, refer to Part I – Item 1A. Risk Factors of our
Annual Report on Form 10-K for the year ended December 31, 2017. You are urged to carefully consider these risk factors.
Cleveland-Cliffs Inc.
MEDIA CONTACT
Patricia Persico, 216-694-5316
Director, Corporate Communications
or
INVESTOR CONTACT
Paul Finan, 216-694-6544
Director, Investor Relations
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