Cleveland-Cliffs Completes Major Share Buyback; Announces Indiana Harbor BF Maintenance Outage
In a statement, the company said the move, which benefits shareholders, reduces its diluted share count by 10% on a pro forma basis.
"Given the strength of our business fundamentals and where our common shares have been trading, the buyback of the preferred shares at an attractive price was a no-brainer,” said Cliffs chairman and chief executive Lourenco Goncalves.
The company said the buyback was paid for with existing liquidity. The company is in position to make such a move partly on account of robust market conditions.
In fact, Cliffs posted record second-quarter revenue of US$5 billion and record quarterly net income of US$795 million.
“The numbers unequivocally confirm our efficiency in operating the new footprint, resulting from the integration of the two major steel companies acquired in 2020 as a single and indivisible mining and steel company. They also demonstrate our flawless execution in ramping up our state-of-the-art direct reduction plant in Toledo to the current level of production above nominal capacity,” Goncalves said.
The company said the plant reached its nameplate capacity of 1.9 million tons, a feat achieved within six months of its start-up.
The plant is so far in July producing at an annualized rate of 2.1 million tons.
“The decision we made four years ago to invest US$1 billion in our direct reduction plant has been proven to be not only right, but also perfectly timed. Our internal use of HBI has minimized our reliance on prime scrap in our BOFs and EAFs, as well as enhanced productivity and reduced emissions in our blast furnaces as demonstrated by our actual CO2
emissions figures,” Goncalves said.
On another front, the company said its largest blast furnace, Indiana Harbor No. 7, is set come off-line in September as part of a planned 45-day maintenance outage.
The company said the outage includes repairs to two BOF converters and a partial reline of, and several upgrades to, the blast furnace.
“Some of these upgrades are related to our ongoing work toward decarbonization,”
The outage will run from 1 September to 15 October.