Cleveland-Cliffs Reports Preliminary 2024 Financial Results Amidst Market Challenges
Cleveland-Cliffs has recently disclosed preliminary results for the fourth quarter and full-year 2024, reflecting both the effects of a challenging steel market and the recent acquisition of Stelco Holdings Inc. The announcement, made on February 3, 2025, includes financial expectations and highlights from the period ending December 31, 2024.
The company’s fourth-quarter results were impacted by lower-than-expected domestic steel demand, particularly from the automotive sector, which has been experiencing a decline in orders. However, Cleveland-Cliffs remains optimistic about the future, forecasting stronger results in 2025 due to potential growth in steel demand, aided by new trade tariffs and operational synergies from the Stelco acquisition.
Fourth-Quarter 2024 Financial Expectations
• Steel Shipments: Cleveland-Cliffs anticipates steel shipments of approximately 3.8 million metric tons in the fourth quarter of 2024.
• Revenues: Expected revenues for the quarter are around $4.3 billion.
• Adjusted EBITDA: The company is projecting an Adjusted EBITDA loss of about $85 million, reflecting the overall weaker demand.
Full-Year 2024 Financial Expectations
For the full year of 2024, Cleveland-Cliffs forecasts the following:
• Steel Shipments: Total steel shipments for 2024 are estimated to be 15.6 million metric tons.
• Revenues: The company expects annual revenues to be approximately $19.2 billion.
• Adjusted EBITDA: The expected Adjusted EBITDA for 2024 stands at approximately $775 million.
• Pro-Forma Adjusted EBITDA: Including the acquisition of Stelco, the Pro-Forma Adjusted EBITDA is expected to reach approximately $1.2 billion.
The Stelco Acquisition and Its Impact
Cleveland-Cliffs’ acquisition of Stelco Holdings on November 1, 2024 is a significant step in the company’s strategy to expand its footprint in the steel industry. While the integration is still in progress, Stelco has already contributed positively to the company’s overall performance, and synergies from the deal are already being realized. The acquisition is expected to help Cleveland-Cliffs tap into additional market opportunities and leverage Stelco’s expertise, especially in the face of the steel tariffs expected to benefit both companies.
Industry Challenges and Optimism for 2025
Lourenco Goncalves, Cleveland-Cliffs’ Chairman, President, and CEO, acknowledged that 2024 was one of the most challenging years for steel demand in the U.S., with the exception of 2020 during the COVID-19 pandemic. The company’s primary focus was on the weakened demand from the automotive sector, which severely affected the results, particularly in the fourth quarter. Despite these challenges, Goncalves is confident that 2025 will mark a turning point, as signs of improvement have already emerged in Cleveland-Cliffs' order book.
Moreover, Cleveland-Cliffs is optimistic about the ongoing impact of steel tariffs, especially the recently imposed tariffs on Mexico, Canada, and China, as well as potential future measures to bolster the domestic steel industry. These tariffs are expected to benefit Cleveland-Cliffs and its new subsidiary, Stelco, by supporting higher steel prices and improving market conditions.
