Cliffs Natural Resources Inc. Earnings: Exceeds Expectations

Although S&P 500 (NYSE:SPY) component Cliffs Natural Resources Inc.’s (NYSE:CLF) net income fell in the first quarter from a year earlier, profit exceeded analysts’ expectations. Cliffs Natural Resources is an international mining company that operates primarily in North America and Australia.

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Cliffs Natural Resources Earnings Cheat Sheet for the First Quarter

Results: Net income for the mining-iron fell to $391.4 million ($2.63 per share) vs. $423.4 million ($3.11 per share) a year earlier. This is a decline of 7.6% from the year-earlier quarter.

Revenue: Rose 6.9% to $1.26 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Cliffs Natural Resources Inc. beat the mean analyst estimate of $1.15 per share.

Quoting Management: Joseph Carrabba, the Company’s chairman, president and chief executive officer, said, “Our ability to increase sales volumes across all business segments is the direct result of continued execution of the organic growth projects acquired over recent years. We recognize that at times, this growth presents challenges; however, we are committed to optimizing all of our operations, both new and old, to deliver increased production reliability and scale. As announced last month, we are shifting our focus from large-scale acquisitions to project management within our internal pipeline.”

Key Stats:

Revenue has risen for the last four quarters. Revenue increased 16.7% to $1.66 billion in the fourth quarter of the last fiscal year. The figure rose 59.2% in the third quarter of the last fiscal year from the year earlier and climbed 52.5% in the second quarter of the last fiscal year from the year-ago quarter.

The company’s net income has fallen in each of the last two quarters. In the fourth quarter of the last fiscal year, net income fell 49.5% from the year-earlier quarter.

The company topped expectations last quarter after falling short of forecasts in the fourth quarter of the last fiscal year with net income of $1.42 versus a mean estimate of net income of $1.54 per share.

Looking Forward: Over the past ninety days, the average estimate for the second quarter has fallen from $3.08 per share to $2.32, indicating that analysts are growing pessisimistic about the company’s performance next quarter. At $9.32 per share, the average estimate for the fiscal year has fallen from $12.60 ninety days ago.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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