Cliffs Natural Resources Inc. (NYSE: CLF) (Paris: CLF) today reported second-quarter results for the period ended June 30, 2012 .
The company, in a news release, said consolidated revenues decreased 10% for the second quarter to $1.6 billion , from $1.8 billion in the same quarter last year. Officials say the decrease was primarily driven by lower year-over-year pricing for the commodity products the Company markets.
Lower revenues and increased cost of goods sold driven by higher labor, mining, and maintenance expenses resulted in a 39% decrease in consolidated sales margin to $449 million compared with the second quarter of 2011.
Joseph A. Carrabba , Cliffs’ chairman, president and chief executive officer, said, “While the current pricing environment is softer year over year, the underlying fundamentals supporting Cliffs’ long-term strategy remain intact. We will continue to execute our expansion plans at Bloom Lake Mine . Cliffs has the potential to build an iron ore business in Eastern Canada rivaling our legacy U.S. Iron Ore operations in size and scope. This business will also have full access to the seaborne market and developing economies around the world.”
CLiffs’ officials say net income attributable to Cliffs’ common shareholders was $258 million , or $1.81 per diluted share, down from $409 million , or $2.92 per diluted share in the second quarter of 2011. The press release continues, to say “the decrease was primarily due to lower consolidated sales margin, as indicated above, and the absence of a significant foreign currency hedging gain, which was reported in the second quarter of 2011. Partially offsetting the decrease were lower year-over-year interest expense and a $29 million favorable impact recorded as miscellaneous net, primarily related to foreign currency remeasurements, the sale of investments and receipt of insurance proceeds. Also, during the quarter, the Company recorded a $27 million discrete tax item related to the favorable resolution of a tax position.”