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Name | Location | Ownership Interest | Operation | |||
Northshore | Minnesota | 100.0% | Iron Ore | |||
United Taconite | Minnesota | 100.0% | Iron Ore | |||
Wabush | Newfoundland and Labrador/Quebec, Canada | 100.0% | Iron Ore | |||
Bloom Lake | Quebec, Canada | 75.0% | Iron Ore | |||
Tilden | Michigan | 85.0% | Iron Ore | |||
Empire | Michigan | 79.0% | Iron Ore | |||
Koolyanobbing | Western Australia | 100.0% | Iron Ore | |||
Pinnacle | West Virginia | 100.0% | Coal | |||
Oak Grove | Alabama | 100.0% | Coal | |||
CLCC | West Virginia | 100.0% | Coal |
(In Millions) | ||||||||||||||
Investment | Classification | Accounting Method | Interest Percentage | June 30, 2013 | December 31, 2012 | |||||||||
Amapá | Investments in ventures | Equity Method | 30 | $ | 29.4 | $ | 101.9 | |||||||
Cockatoo | Other liabilities2 | Equity Method | — | N/A | (25.3 | ) | ||||||||
Hibbing | Investments in ventures1 | Equity Method | 23 | 6.4 | (2.1 | ) | ||||||||
Other | Investments in ventures | Equity Method | Various | 32.9 | 33.9 | |||||||||
$ | 68.7 | $ | 108.4 |
Intangible Assets | Basis | Useful Life (years) | ||
Permits - Asia Pacific Iron Ore | Units of production | Life of mine | ||
Permits - All Other | Straight line | 15 - 40 | ||
Utility contracts | Straight line | 5 | ||
Leases - North American Coal | Units of production | Life of mine | ||
Leases - All Other | Straight line | 4.5 - 17.5 |
|
(In Millions) | |||||||||||||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||||||||||||
Revenues from product sales and services: | |||||||||||||||||||||||||||
U.S. Iron Ore | $ | 701.7 | 47 | % | $ | 705.0 | 45 | % | $ | 1,111.8 | 42 | % | $ | 1,146.7 | 41 | % | |||||||||||
Eastern Canadian Iron Ore | 213.9 | 14 | % | 303.9 | 19 | % | 459.2 | 17 | % | 524.6 | 19 | % | |||||||||||||||
Asia Pacific Iron Ore | 327.0 | 22 | % | 361.3 | 23 | % | 597.8 | 23 | % | 721.1 | 26 | % | |||||||||||||||
North American Coal | 245.9 | 17 | % | 209.2 | 13 | % | 460.2 | 18 | % | 399.2 | 14 | % | |||||||||||||||
Other | — | — | % | — | — | % | — | — | % | 0.1 | — | % | |||||||||||||||
Total revenues from product sales and services | $ | 1,488.5 | 100 | % | $ | 1,579.4 | 100 | % | $ | 2,629.0 | 100 | % | $ | 2,791.7 | 100 | % | |||||||||||
Sales margin: | |||||||||||||||||||||||||||
U.S. Iron Ore | $ | 216.3 | $ | 286.1 | $ | 373.6 | $ | 452.9 | |||||||||||||||||||
Eastern Canadian Iron Ore | (49.7 | ) | 11.7 | (30.3 | ) | (2.6 | ) | ||||||||||||||||||||
Asia Pacific Iron Ore | 95.0 | 146.8 | 156.3 | 271.9 | |||||||||||||||||||||||
North American Coal | 6.6 | (9.6 | ) | 8.4 | 5.0 | ||||||||||||||||||||||
Other | — | 8.4 | (1.9 | ) | 8.0 | ||||||||||||||||||||||
Sales margin | 268.2 | 443.4 | 506.1 | 735.2 | |||||||||||||||||||||||
Other operating expense | (6.2 | ) | (81.5 | ) | (75.8 | ) | (150.3 | ) | |||||||||||||||||||
Other income (expense) | (43.5 | ) | (47.5 | ) | (91.5 | ) | (90.8 | ) | |||||||||||||||||||
Income from continuing operations before income taxes and equity loss from ventures | $ | 218.5 | $ | 314.4 | $ | 338.8 | $ | 494.1 | |||||||||||||||||||
Depreciation, depletion and amortization: | |||||||||||||||||||||||||||
U.S. Iron Ore | $ | 28.4 | $ | 23.8 | $ | 55.0 | $ | 47.0 | |||||||||||||||||||
Eastern Canadian Iron Ore | 42.4 | 38.6 | 83.5 | 76.5 | |||||||||||||||||||||||
Asia Pacific Iron Ore | 41.7 | 39.8 | 78.1 | 69.8 | |||||||||||||||||||||||
North American Coal | 28.4 | 24.3 | 60.9 | 44.4 | |||||||||||||||||||||||
Other | 3.4 | 5.6 | 7.4 | 11.7 | |||||||||||||||||||||||
Total depreciation, depletion and amortization | $ | 144.3 | $ | 132.1 | $ | 284.9 | $ | 249.4 | |||||||||||||||||||
Capital additions (1): | |||||||||||||||||||||||||||
U.S. Iron Ore | $ | 12.2 | $ | 28.1 | $ | 23.9 | $ | 62.9 | |||||||||||||||||||
Eastern Canadian Iron Ore | 186.8 | 177.3 | 353.8 | 307.9 | |||||||||||||||||||||||
Asia Pacific Iron Ore | 2.3 | 16.9 | 6.6 | 126.2 | |||||||||||||||||||||||
North American Coal | 15.7 | 32.7 | 26.8 | 71.8 | |||||||||||||||||||||||
Other | 1.1 | 11.1 | 2.7 | 50.7 | |||||||||||||||||||||||
Total capital additions | $ | 218.1 | $ | 266.1 | $ | 413.8 | $ | 619.5 |
(In Millions) | |||||||
June 30, 2013 | December 31, 2012 | ||||||
Assets: | |||||||
U.S. Iron Ore | $ | 1,791.6 | $ | 1,735.1 | |||
Eastern Canadian Iron Ore | 7,860.8 | 7,605.1 | |||||
Asia Pacific Iron Ore | 1,261.6 | 1,506.3 | |||||
North American Coal | 1,867.7 | 1,877.8 | |||||
Other | 643.9 | 570.9 | |||||
Total segment assets | 13,425.6 | 13,295.2 | |||||
Corporate | 169.3 | 279.7 | |||||
Total assets | $ | 13,594.9 | $ | 13,574.9 |
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(In Millions) | |||||||||||||||||||||||
Derivative Assets | Derivative Liabilities | ||||||||||||||||||||||
June 30, 2013 | December 31, 2012 | June 30, 2013 | December 31, 2012 | ||||||||||||||||||||
Derivative Instrument | Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | |||||||||||||||
Derivatives designated as hedging instruments under ASC 815: | |||||||||||||||||||||||
Foreign Exchange Contracts | $ | — | Derivative assets | $ | 16.2 | Derivative liabilities | $ | 56.6 | Derivative liabilities | $ | 1.9 | ||||||||||||
Total derivatives designated as hedging instruments under ASC 815 | $ | — | $ | 16.2 | $ | 56.6 | $ | 1.9 | |||||||||||||||
Derivatives not designated as hedging instruments under ASC 815: | |||||||||||||||||||||||
Customer Supply Agreements | Derivative assets | $ | 44.2 | Derivative assets | $ | 58.9 | $ | — | $ | — | |||||||||||||
Provisional Pricing Arrangements | Derivative assets | 0.9 | Derivative assets | 3.5 | Derivative liabilities | 32.0 | Derivative liabilities | 11.3 | |||||||||||||||
Total derivatives not designated as hedging instruments under ASC 815 | $ | 45.1 | $ | 62.4 | $ | 32.0 | $ | 11.3 | |||||||||||||||
Total derivatives | $ | 45.1 | $ | 78.6 | $ | 88.6 | $ | 13.2 |
(In Millions) | |||||||||||||||||
Derivatives in Cash Flow | Amount of Gain (Loss) Recognized in OCI on Derivative | Location of Gain (Loss) Reclassified from Accumulated OCI into Earnings | Amount of Gain (Loss) Reclassified from Accumulated OCI into Earnings | ||||||||||||||
Hedging Relationships | (Effective Portion) | (Effective Portion) | (Effective Portion) | ||||||||||||||
Three Months Ended June 30, | Three Months Ended June 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
Australian Dollar Foreign Exchange Contracts (hedge designation) | $ | (31.3 | ) | $ | 2.1 | Product revenues | $ | 2.6 | $ | (0.4 | ) | ||||||
Canadian Dollar Foreign Exchange Contracts (hedge designation) | (10.9 | ) | (5.9 | ) | Cost of goods sold and operating expenses | (0.4 | ) | (0.2 | ) | ||||||||
Total | $ | (42.2 | ) | $ | (3.8 | ) | $ | 2.2 | $ | (0.6 | ) | ||||||
Six Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
Australian Dollar Foreign Exchange Contracts (hedge designation) | $ | (28.1 | ) | $ | 5.1 | Product revenues | $ | 4.4 | $ | 2.7 | |||||||
Canadian Dollar Foreign Exchange Contracts (hedge designation) | (19.1 | ) | (5.2 | ) | Cost of goods sold and operating expenses | (0.2 | ) | 0.3 | |||||||||
$ | (47.2 | ) | $ | (0.1 | ) | $ | 4.2 | $ | 3.0 |
(In Millions) | ||||||||||||||||
Derivatives Not Designated as Hedging Instruments | Location of Gain (Loss) Recognized in Income on Derivative | Amount of Gain/(Loss) Recognized in Income on Derivative | ||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Foreign Exchange Contracts | Other income (expense) | $ | — | $ | — | $ | — | $ | 0.3 | |||||||
Customer Supply Agreements | Product revenues | 35.4 | 42.6 | 59.5 | 82.0 | |||||||||||
Provisional Pricing Arrangements | Product revenues | (28.2 | ) | 98.3 | (31.1 | ) | 98.3 | |||||||||
Total | $ | 7.2 | $ | 140.9 | $ | 28.4 | $ | 180.6 |
|
(In Millions) | |||||||||||||||||||||||
June 30, 2013 | December 31, 2012 | ||||||||||||||||||||||
Segment | Finished Goods | Work-in Process | Total Inventory | Finished Goods | Work-in Process | Total Inventory | |||||||||||||||||
U.S. Iron Ore | $ | 242.1 | $ | 22.2 | $ | 264.3 | $ | 147.2 | $ | 22.9 | $ | 170.1 | |||||||||||
Eastern Canadian Iron Ore | 94.0 | 36.5 | 130.5 | 62.6 | 44.2 | 106.8 | |||||||||||||||||
Asia Pacific Iron Ore | 51.6 | 28.4 | 80.0 | 36.7 | 37.2 | 73.9 | |||||||||||||||||
North American Coal | 40.2 | 14.2 | 54.4 | 36.7 | 49.0 | 85.7 | |||||||||||||||||
Total | $ | 427.9 | $ | 101.3 | $ | 529.2 | $ | 283.2 | $ | 153.3 | $ | 436.5 |
|
(In Millions) | |||||||
June 30, 2013 | December 31, 2012 | ||||||
Land rights and mineral rights | $ | 7,807.6 | $ | 7,920.8 | |||
Office and information technology | 118.8 | 92.4 | |||||
Buildings | 184.9 | 162.0 | |||||
Mining equipment | 1,401.3 | 1,290.7 | |||||
Processing equipment | 2,069.5 | 1,937.4 | |||||
Railroad equipment | 218.9 | 240.8 | |||||
Electric power facilities | 62.1 | 58.7 | |||||
Port facilities | 100.7 | 114.3 | |||||
Interest capitalized during construction | 23.1 | 20.8 | |||||
Land improvements | 60.0 | 43.9 | |||||
Other | 37.5 | 39.0 | |||||
Construction in progress | 1,131.6 | 1,123.9 | |||||
13,216.0 | 13,044.7 | ||||||
Allowance for depreciation and depletion | (2,026.4 | ) | (1,837.4 | ) | |||
$ | 11,189.6 | $ | 11,207.3 |
|
(In Millions) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
REVENUES FROM PRODUCT SALES AND SERVICES | |||||||||||||||
Product | $ | — | $ | 46.6 | $ | — | $ | 99.0 | |||||||
INCOME FROM DISCONTINUED OPERATIONS, net of tax | $ | — | $ | 2.3 | $ | — | $ | 7.8 |
|
(In Millions) | |||||||||||||||||||||||||||||||||||||||||||||||
June 30, 2013 | December 31, 2012 | ||||||||||||||||||||||||||||||||||||||||||||||
U.S. Iron Ore | Eastern Canadian Iron Ore | Asia Pacific Iron Ore | North American Coal | Other | Total | U.S. Iron Ore | Eastern Canadian Iron Ore | Asia Pacific Iron Ore | North American Coal | Other | Total | ||||||||||||||||||||||||||||||||||||
Beginning Balance | $ | 2.0 | $ | — | $ | 84.5 | $ | — | $ | 80.9 | $ | 167.4 | $ | 2.0 | $ | 986.2 | $ | 83.0 | $ | — | $ | 80.9 | $ | 1,152.1 | |||||||||||||||||||||||
Arising in business combinations | — | — | — | — | — | — | — | 13.8 | — | — | — | 13.8 | |||||||||||||||||||||||||||||||||||
Impairment | — | — | — | — | — | — | — | (1,000.0 | ) | — | — | — | (1,000.0 | ) | |||||||||||||||||||||||||||||||||
Impact of foreign currency translation | — | — | (10.2 | ) | — | — | (10.2 | ) | — | — | 1.5 | — | — | 1.5 | |||||||||||||||||||||||||||||||||
Ending Balance | $ | 2.0 | $ | — | $ | 74.3 | $ | — | $ | 80.9 | $ | 157.2 | $ | 2.0 | $ | — | $ | 84.5 | $ | — | $ | 80.9 | $ | 167.4 | |||||||||||||||||||||||
Accumulated Goodwill Impairment Loss | $ | — | $ | (1,000.0 | ) | $ | — | $ | (27.8 | ) | $ | — | $ | (1,027.8 | ) | $ | — | $ | (1,000.0 | ) | $ | — | $ | (27.8 | ) | $ | — | $ | (1,027.8 | ) |
(In Millions) | |||||||||||||||||||||||||
June 30, 2013 | December 31, 2012 | ||||||||||||||||||||||||
Classification | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | |||||||||||||||||||
Definite-lived intangible assets: | |||||||||||||||||||||||||
Permits | Intangible assets, net | $ | 129.3 | $ | (33.3 | ) | $ | 96.0 | $ | 136.1 | $ | (31.7 | ) | $ | 104.4 | ||||||||||
Utility contracts | Intangible assets, net | 54.7 | (38.0 | ) | 16.7 | 54.7 | (32.4 | ) | 22.3 | ||||||||||||||||
Leases | Intangible assets, net | 5.7 | (3.4 | ) | 2.3 | 5.7 | (3.4 | ) | 2.3 | ||||||||||||||||
Total intangible assets | $ | 189.7 | $ | (74.7 | ) | $ | 115.0 | $ | 196.5 | $ | (67.5 | ) | $ | 129.0 | |||||||||||
Below-market sales contracts | Other current liabilities | $ | (46.0 | ) | $ | 7.6 | $ | (38.4 | ) | $ | (46.0 | ) | $ | — | $ | (46.0 | ) | ||||||||
Below-market sales contracts | Other liabilities | (250.7 | ) | 190.6 | (60.1 | ) | (250.7 | ) | 181.6 | (69.1 | ) | ||||||||||||||
Total below-market sales contracts | $ | (296.7 | ) | $ | 198.2 | $ | (98.5 | ) | $ | (296.7 | ) | $ | 181.6 | $ | (115.1 | ) |
(In Millions) | |||
Amount | |||
Year Ending December 31 | |||
2013 (remaining six months) | $ | 11.0 | |
2014 | 19.3 | ||
2015 | 8.5 | ||
2016 | 8.4 | ||
2017 | 8.4 | ||
2018 | 7.8 | ||
Total | $ | 63.4 |
(In Millions) | |||
Amount | |||
Year Ending December 31 | |||
2013 (remaining six months) | $ | 29.4 | |
2014 | 23.1 | ||
2015 | 23.0 | ||
2016 | 23.0 | ||
Total | $ | 98.5 |
|
(In Millions) | |||||||||||||||
June 30, 2013 | |||||||||||||||
Description | Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | |||||||||||
Assets: | |||||||||||||||
Cash equivalents | $ | 140.0 | $ | — | $ | — | $ | 140.0 | |||||||
Derivative assets | — | — | 45.1 | 45.1 | |||||||||||
Marketable securities | 23.2 | — | — | 23.2 | |||||||||||
Foreign exchange contracts | — | — | — | — | |||||||||||
Total | $ | 163.2 | $ | — | $ | 45.1 | $ | 208.3 | |||||||
Liabilities: | |||||||||||||||
Derivative liabilities | $ | — | $ | — | $ | 32.0 | $ | 32.0 | |||||||
Foreign exchange contracts | — | 56.6 | — | 56.6 | |||||||||||
Total | $ | — | $ | 56.6 | $ | 32.0 | $ | 88.6 |
(In Millions) | |||||||||||||||
December 31, 2012 | |||||||||||||||
Description | Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | |||||||||||
Assets: | |||||||||||||||
Cash equivalents | $ | 100.0 | $ | — | $ | — | $ | 100.0 | |||||||
Derivative assets | — | — | 62.4 | 62.4 | |||||||||||
Marketable securities | 27.0 | — | — | 27.0 | |||||||||||
Foreign exchange contracts | — | 16.2 | — | 16.2 | |||||||||||
Total | $ | 127.0 | $ | 16.2 | $ | 62.4 | $ | 205.6 | |||||||
Liabilities: | |||||||||||||||
Derivative liabilities | $ | — | $ | — | $ | 11.3 | $ | 11.3 | |||||||
Foreign exchange contracts | — | 1.9 | — | 1.9 | |||||||||||
Total | $ | — | $ | 1.9 | $ | 11.3 | $ | 13.2 |
Qualitative/Quantitative Information About Level 3 Fair Value Measurements | ||||||||||||
($ in millions) | Fair Value at | Balance Sheet Location | Valuation Technique | Unobservable Input | Range or Point Estimate (Weighted Average) | |||||||
6/30/2013 | ||||||||||||
Provisional Pricing Arrangements | $ | 0.9 | Derivative assets | Market Approach | Managements Estimate of 62% Fe | $116 | ||||||
$ | 32.0 | Derivative liabilities | ||||||||||
Customer Supply Agreement | $ | 44.2 | Derivative assets | Market Approach | Hot-Rolled Steel Estimate | $580 - $630 ($615) |
(In Millions) | |||||||||||||||
Derivative Assets (Level 3) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Beginning balance | $ | 53.3 | $ | 69.2 | $ | 62.4 | $ | 157.9 | |||||||
Total gains | |||||||||||||||
Included in earnings | 32.4 | 61.4 | 60.4 | 104.7 | |||||||||||
Settlements | (40.6 | ) | (46.7 | ) | (77.7 | ) | (178.7 | ) | |||||||
Transfers into Level 3 | — | — | — | — | |||||||||||
Transfers out of Level 3 | — | — | — | — | |||||||||||
Ending balance - June 30 | $ | 45.1 | $ | 83.9 | $ | 45.1 | $ | 83.9 | |||||||
Total gains for the period included in earnings attributable to the change in unrealized gains on assets still held at the reporting date | $ | 32.4 | $ | 61.4 | $ | 60.4 | $ | 104.7 |
(In Millions) | |||||||||||||||
Derivative Liabilities (Level 3) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Beginning balance | $ | (6.8 | ) | $ | (1.1 | ) | $ | (11.3 | ) | $ | (19.5 | ) | |||
Total gains | |||||||||||||||
Included in earnings | (25.2 | ) | (14.7 | ) | (32.0 | ) | (15.8 | ) | |||||||
Settlements | — | — | 11.3 | 19.5 | |||||||||||
Transfers into Level 3 | — | — | — | — | |||||||||||
Transfers out of Level 3 | — | — | — | — | |||||||||||
Ending balance - June 30 | $ | (32.0 | ) | $ | (15.8 | ) | $ | (32.0 | ) | $ | (15.8 | ) | |||
Total gains (losses) for the period included in earnings attributable to the change in unrealized gains (losses) on liabilities still held at the reporting date | $ | (25.2 | ) | $ | (14.7 | ) | $ | (32.0 | ) | $ | (15.8 | ) |
(In Millions) | |||||||||||||||||
June 30, 2013 | December 31, 2012 | ||||||||||||||||
Classification | Carrying Value | Fair Value | Carrying Value | Fair Value | |||||||||||||
Other receivables: | |||||||||||||||||
Customer supplemental payments | Level 2 | $ | — | $ | — | $ | 22.3 | $ | 21.3 | ||||||||
ArcelorMittal USA—Receivable | Level 2 | 15.4 | 16.7 | 19.3 | 21.3 | ||||||||||||
Other | Level 2 | 9.8 | 9.8 | 10.9 | 10.9 | ||||||||||||
Total receivables | $ | 25.2 | $ | 26.5 | $ | 52.5 | $ | 53.5 | |||||||||
Long-term debt: | |||||||||||||||||
Term loan—$1.25 billion | Level 2 | $ | — | $ | — | $ | 753.0 | $ | 753.0 | ||||||||
Senior notes—$700 million | Level 2 | 699.4 | 718.9 | 699.4 | 759.4 | ||||||||||||
Senior notes—$1.3 billion | Level 2 | 1,289.5 | 1,450.6 | 1,289.4 | 1,524.7 | ||||||||||||
Senior notes—$400 million | Level 2 | 398.3 | 440.5 | 398.2 | 464.3 | ||||||||||||
Senior notes—$500 million | Level 2 | 496.1 | 514.7 | 495.7 | 528.4 | ||||||||||||
Revolving loan | Level 2 | 440.0 | 440.0 | 325.0 | 325.0 | ||||||||||||
Total long-term debt | $ | 3,323.3 | $ | 3,564.7 | $ | 3,960.7 | $ | 4,354.8 |
(In Millions) | ||||||||||||||
June 30, 2012 | ||||||||||||||
Description | Quoted Prices in Active Markets for Identical Assets/ Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | Total Losses | |||||||||
Assets: | ||||||||||||||
Investment in ventures impairment - Amapá | — | — | — | $ | — | $ | 67.6 |
(In Millions) | ||||||||||||||||
December 31, 2012 | ||||||||||||||||
Description | Quoted Prices in Active Markets for Identical Assets/ Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | ||||||||||||
Assets: | ||||||||||||||||
Investment in ventures impairment - Amapá | $ | — | $ | — | $ | 72.5 | $ | 72.5 |
|
($ in Millions) | |||||||||||||||
June 30, 2013 | |||||||||||||||
Debt Instrument | Type | Annual Effective Interest Rate | Final Maturity | Total Face Amount | Total Debt | ||||||||||
$700 Million 4.875% 2021 Senior Notes | Fixed | 4.89% | 2021 | $ | 700.0 | $ | 699.4 | (2) | |||||||
$1.3 Billion Senior Notes: | |||||||||||||||
$500 Million 4.80% 2020 Senior Notes | Fixed | 4.83% | 2020 | 500.0 | 499.2 | (3) | |||||||||
$800 Million 6.25% 2040 Senior Notes | Fixed | 6.34% | 2040 | 800.0 | 790.3 | (4) | |||||||||
$400 Million 5.90% 2020 Senior Notes | Fixed | 5.98% | 2020 | 400.0 | 398.3 | (5) | |||||||||
$500 Million 3.95% 2018 Senior Notes | Fixed | 4.14% | 2018 | 500.0 | 496.1 | (6) | |||||||||
$1.75 Billion Credit Facility: | |||||||||||||||
Revolving Loan | Variable | 2.05% | 2017 | 1,750.0 | 440.0 | (7) | |||||||||
Total debt | $ | 4,650.0 | $ | 3,323.3 | |||||||||||
Less current portion | — | ||||||||||||||
Long-term debt | $ | 3,323.3 |
($ in Millions) | |||||||||||||||
December 31, 2012 | |||||||||||||||
Debt Instrument | Type | Annual Effective Interest Rate | Final Maturity | Total Face Amount | Total Debt | ||||||||||
$1.25 Billion Term Loan | Variable | 1.83% | 2016 | $ | 847.1 | (1) | $ | 847.1 | (1) | ||||||
$700 Million 4.875% 2021 Senior Notes | Fixed | 4.88% | 2021 | 700.0 | 699.4 | (2) | |||||||||
$1.3 Billion Senior Notes: | |||||||||||||||
$500 Million 4.80% 2020 Senior Notes | Fixed | 4.80% | 2020 | 500.0 | 499.2 | (3) | |||||||||
$800 Million 6.25% 2040 Senior Notes | Fixed | 6.25% | 2040 | 800.0 | 790.2 | (4) | |||||||||
$400 Million 5.90% 2020 Senior Notes | Fixed | 5.90% | 2020 | 400.0 | 398.2 | (5) | |||||||||
$500 Million 3.95% 2018 Senior Notes | Fixed | 4.14% | 2018 | 500.0 | 495.7 | (6) | |||||||||
$1.75 Billion Credit Facility: | |||||||||||||||
Revolving Loan | Variable | 2.02% | 2017 | 1,750.0 | 325.0 | (7) | |||||||||
Total debt | $ | 5,497.1 | $ | 4,054.8 | |||||||||||
Less current portion | 94.1 | ||||||||||||||
Long-term debt | $ | 3,960.7 |
(1) | During the first quarter of 2013 the term loan was repaid in full through repayments totaling $847.1 million. As of December 31, 2012, $402.8 million had been paid down on the original $1.25 billion term loan and, of the remaining term loan $94.1 million, was classified as Current portion of debt. The current classification was based upon the principal payment terms of the arrangement requiring principal payments on each three-month anniversary following the funding of the term loan. |
(2) | As of June 30, 2013 and December 31, 2012, the $700 million 4.875 percent senior notes were recorded at a par value of $700 million less unamortized discounts of $0.6 million for each period, based on an imputed interest rate of 4.89 percent. |
(3) | As of June 30, 2013 and December 31, 2012, the $500 million 4.80 percent senior notes were recorded at a par value of $500 million less unamortized discounts of $0.8 million for each period, based on an imputed interest rate of 4.83 percent. |
(4) | As of June 30, 2013 and December 31, 2012, the $800 million 6.25 percent senior notes were recorded at par value of $800 million less unamortized discounts of $9.7 million and $9.8 million, respectively, based on an imputed interest rate of 6.34 percent. |
(5) | As of June 30, 2013 and December 31, 2012, the $400 million 5.90 percent senior notes were recorded at a par value of $400 million less unamortized discounts of $1.7 million and $1.8 million, respectively, based on an imputed interest rate of 5.98 percent. |
(6) | As of June 30, 2013 and December 31, 2012, the $500 million 3.95 percent senior notes were recorded at a par value of $500 million less unamortized discounts of $3.9 million and $4.3 million, respectively, based on an imputed interest rate of 4.14 percent. |
(7) | As of June 30, 2013 and December 31, 2012, $440.0 million and $325.0 million revolving loans were drawn under the credit facility, respectively, and the principal amount of letter of credit obligations totaled $27.7 million for each period, thereby reducing available borrowing capacity to $1.3 billion and $1.4 billion for each period, respectively. |
• | Suspend the current Funded Debt to EBITDA ratio requirement for all quarterly measurement periods in 2013, after which point it will revert back to the period ending March 31, 2014 until maturity. |
• | Require a Minimum Tangible Net Worth of approximately $4.6 billion as of each of the three-month periods ended March 31, 2013, June 30, 2013, September 30, 2013 and December 31, 2013. Minimum Tangible Net Worth, in accordance with the amended credit agreement and term loan, is defined as total equity less goodwill and intangible assets. |
• | Maintain a Maximum Total Funded Debt to Capitalization of 52.5 percent from the amendments' effective date through the period ending December 31, 2013. |
• | The amended agreements retain the Minimum Interest Coverage Ratio requirement of 2.5 to 1.0. |
(In Millions) | |||
Maturities of Debt | |||
2013 (July 1 - December 31) | $ | — | |
2014 | — | ||
2015 | — | ||
2016 | — | ||
2017 | — | ||
2018 and thereafter | 2,900.0 | ||
Total maturities of debt | $ | 2,900.0 |
|
(In Millions) | |||||||
Capital Leases | Operating Leases | ||||||
2013 (July 1 - December 31) | $ | 35.8 | $ | 13.4 | |||
2014 | 65.0 | 20.1 | |||||
2015 | 53.6 | 13.4 | |||||
2016 | 38.2 | 8.3 | |||||
2017 | 31.1 | 7.5 | |||||
2018 and thereafter | 84.6 | 21.5 | |||||
Total minimum lease payments | $ | 308.3 | $ | 84.2 | |||
Amounts representing interest | 63.3 | ||||||
Present value of net minimum lease payments | $ | 245.0 | (1) |
(1) | The total is comprised of $50.5 million and $194.5 million classified as Other current liabilities and Other liabilities, respectively, in the Statements of Unaudited Condensed Consolidated Financial Position at June 30, 2013. |
|
(In Millions) | |||||||
June 30, 2013 | December 31, 2012 | ||||||
Environmental | $ | 9.1 | $ | 15.7 | |||
Mine closure | |||||||
LTVSMC | 19.1 | 18.3 | |||||
Operating mines: | |||||||
U.S. Iron Ore | 85.1 | 81.2 | |||||
Eastern Canadian Iron Ore | 75.0 | 88.9 | |||||
Asia Pacific Iron Ore | 20.2 | 22.4 | |||||
North American Coal | 39.5 | 38.6 | |||||
Total mine closure | 238.9 | 249.4 | |||||
Total environmental and mine closure obligations | 248.0 | 265.1 | |||||
Less current portion | 12.2 | 12.3 | |||||
Long term environmental and mine closure obligations | $ | 235.8 | $ | 252.8 |
(In Millions) | ||||||||
June 30, 2013 | December 31, 2012 | (1) | ||||||
Asset retirement obligation at beginning of period | $ | 231.1 | $ | 194.9 | ||||
Accretion expense | 9.0 | 17.6 | ||||||
Exchange rate changes | (2.9 | ) | 0.3 | |||||
Revision in estimated cash flows | (17.1 | ) | 18.2 | |||||
Payments | (0.3 | ) | 0.1 | |||||
Asset retirement obligation at end of period | $ | 219.8 | $ | 231.1 |
(1) | Represents a 12-month rollforward of our asset retirement obligation at December 31, 2012. |
|
(In Millions) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Service cost | $ | 9.7 | $ | 8.0 | $ | 19.6 | $ | 16.0 | |||||||
Interest cost | 11.7 | 12.3 | 23.2 | 24.3 | |||||||||||
Expected return on plan assets | (20.0 | ) | (15.0 | ) | (33.1 | ) | (29.8 | ) | |||||||
Amortization: | |||||||||||||||
Prior service costs | 0.8 | 0.9 | 1.5 | 1.9 | |||||||||||
Net actuarial loss | 8.2 | 7.6 | 15.0 | 15.0 | |||||||||||
Net periodic benefit cost | $ | 10.4 | $ | 13.8 | $ | 26.2 | $ | 27.4 |
(In Millions) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Service cost | $ | 3.1 | $ | 3.9 | $ | 6.2 | $ | 7.5 | |||||||
Interest cost | 4.4 | 5.4 | 8.7 | 10.6 | |||||||||||
Expected return on plan assets | (5.0 | ) | (4.3 | ) | (10.0 | ) | (8.6 | ) | |||||||
Amortization: | |||||||||||||||
Prior service costs | (0.9 | ) | 0.8 | (1.8 | ) | 1.5 | |||||||||
Net actuarial loss | 3.0 | 2.7 | 5.8 | 5.6 | |||||||||||
Net periodic benefit cost | $ | 4.6 | $ | 8.5 | $ | 8.9 | $ | 16.6 |
|
Grant Date | Grant Date Market Price | Average Expected Term (Years) | Expected Volatility | Risk-Free Interest Rate | Dividend Yield | Fair Value | Fair Value (Percent of Grant Date Market Price) | |||||||||||
March 11, 2013 | $ | 23.83 | 2.81 | 52.9% | 0.40% | 2.52% | $ | 17.01 | 71.38% |
|
|
|
(In Millions) | |||||||||||
Cliffs Shareholders’ Equity | Noncontrolling Interest | Total Equity | |||||||||
December 31, 2012 | $ | 4,632.7 | $ | 1,128.2 | $ | 5,760.9 | |||||
Comprehensive income | |||||||||||
Net income | 253.0 | 9.1 | 262.1 | ||||||||
Other comprehensive income (loss) | (184.0 | ) | 2.3 | (181.7 | ) | ||||||
Total comprehensive income | 69.0 | 11.4 | 80.4 | ||||||||
Issuance of common shares | 263.4 | — | 263.4 | ||||||||
Issuance of Preferred Shares | 731.3 | — | 731.3 | ||||||||
Stock and other incentive plans | 3.7 | — | 3.7 | ||||||||
Common and Preferred Shares dividends | (68.9 | ) | — | (68.9 | ) | ||||||
Capital contribution by noncontrolling interest to subsidiary | — | 13.0 | 13.0 | ||||||||
June 30, 2013 | $ | 5,631.2 | $ | 1,152.6 | $ | 6,783.8 |
(In Millions) | |||||||||||
Cliffs Shareholders’ Equity | Noncontrolling Interest | Total Equity | |||||||||
December 31, 2011 | $ | 5,785.0 | $ | 1,254.7 | $ | 7,039.7 | |||||
Comprehensive income | |||||||||||
Net income | 633.8 | 31.9 | 665.7 | ||||||||
Other comprehensive income | 2.7 | 3.0 | 5.7 | ||||||||
Total comprehensive income | 636.5 | 34.9 | 671.4 | ||||||||
Stock and other incentive plans | 2.3 | — | 2.3 | ||||||||
Common shares dividends | (128.8 | ) | — | (128.8 | ) | ||||||
Undistributed gains to noncontrolling interest | — | 8.6 | 8.6 | ||||||||
Capital contribution by noncontrolling interest to subsidiary | — | 22.3 | 22.3 | ||||||||
Acquisition of controlling interest | — | (8.0 | ) | (8.0 | ) | ||||||
June 30, 2012 | $ | 6,295.0 | $ | 1,312.5 | $ | 7,607.5 |
(In Millions) | |||||||||||||||||||
Postretirement Benefit Liability, net of tax | Unrealized Net Gain (Loss) on Securities, net of tax | Unrealized Net Gain (Loss) on Foreign Currency Translation | Net Unrealized Gain (Loss) on Derivative Financial Instruments, net of tax | Accumulated Other Comprehensive Income (Loss) | |||||||||||||||
Balance December 31, 2012 | $ | (382.7 | ) | $ | 2.1 | $ | 316.3 | $ | 8.7 | $ | (55.6 | ) | |||||||
Other comprehensive loss before reclassifications | (1.1 | ) | 2.5 | 3.3 | (5.0 | ) | $ | (0.3 | ) | ||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | 6.4 | 0.1 | — | (2.0 | ) | $ | 4.5 | ||||||||||||
Balance March 31, 2013 | $ | (377.4 | ) | $ | 4.7 | $ | 319.6 | $ | 1.7 | $ | (51.4 | ) | |||||||
Other comprehensive loss before reclassifications | (1.5 | ) | (2.0 | ) | (152.0 | ) | (42.2 | ) | (197.7 | ) | |||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | 8.1 | 3.6 | — | (2.2 | ) | 9.5 | |||||||||||||
Balance June 30, 2013 | $ | (370.8 | ) | $ | 6.3 | $ | 167.6 | $ | (42.7 | ) | $ | (239.6 | ) |
(In Millions) | |||||||||||||||||||
Postretirement Benefit Liability, net of tax | Unrealized Net Gain (Loss) on Securities, net of tax | Unrealized Net Gain (Loss) on Foreign Currency Translation | Net Unrealized Gain (Loss) on Derivative Financial Instruments, net of tax | Accumulated Other Comprehensive Income (Loss) | |||||||||||||||
Balance December 31, 2011 | $ | (408.9 | ) | $ | 2.6 | $ | 312.5 | $ | 1.2 | $ | (92.6 | ) | |||||||
Change during 2012 | 10.3 | (0.5 | ) | (6.5 | ) | (0.6 | ) | 2.7 | |||||||||||
Balance June 30, 2012 | $ | (398.6 | ) | $ | 2.1 | $ | 306.0 | $ | 0.6 | $ | (89.9 | ) |
Details about Accumulated Other Comprehensive Income (Loss) Components | Amount of Gain (Loss) Reclassified from Accumulated OCI into Income | Affected Line Item in the Statement of Unaudited Condensed Consolidated Operations | ||||||||
Three Months Ended June 30, 2013 | Six Months Ended June 30, 2013 | |||||||||
Amortization of Pension and Postretirement Benefit Liability: | ||||||||||
Prior-service costs | $ | (0.1 | ) | $ | (0.3 | ) | (1) | |||
Net actuarial loss | 11.2 | 20.8 | (1) | |||||||
11.1 | 20.5 | Total before taxes | ||||||||
(3.0 | ) | (6.0 | ) | Income tax benefit (expense) | ||||||
$ | 8.1 | $ | 14.5 | Net of taxes | ||||||
Unrealized gain (loss) on securities: | ||||||||||
Sale of marketable securities | $ | (1.1 | ) | $ | (1.1 | ) | Other non-operating expense | |||
Impairment | $ | 5.2 | $ | 5.3 | Other non-operating expense | |||||
4.1 | 4.2 | Total before taxes | ||||||||
(0.5 | ) | (0.5 | ) | Income tax benefit (expense) | ||||||
$ | 3.6 | $ | 3.7 | Net of taxes | ||||||
Unrealized gain (loss) on derivative financial instruments: | ||||||||||
Australian dollar foreign exchange contracts | $ | (3.7 | ) | $ | (6.3 | ) | Product revenues | |||
Canadian dollar foreign exchange contracts | 0.6 | 0.3 | Cost of goods sold and operating expenses | |||||||
(3.1 | ) | (6.0 | ) | Total before taxes | ||||||
0.9 | 1.8 | Income tax benefit (expense) | ||||||||
$ | (2.2 | ) | $ | (4.2 | ) | Net of taxes | ||||
Total Reclassifications for the Period | $ | 9.5 | $ | 14.0 |
(1) | These accumulated other comprehensive income components are included in the computation of net periodic benefit cost. See NOTE 12 - PENSIONS AND OTHER POSTRETIREMENT BENEFITS for further information. |
|
Mine | Cliffs Natural Resources | ArcelorMittal | U.S. Steel Canada | WISCO | ||||
Empire | 79.0 | 21.0 | — | — | ||||
Tilden | 85.0 | — | 15.0 | — | ||||
Hibbing | 23.0 | 62.3 | 14.7 | — | ||||
Bloom Lake | 75.0 | — | — | 25.0 |
(In Millions) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Product revenues from related parties | $ | 455.0 | $ | 465.4 | $ | 756.2 | $ | 797.3 | |||||||
Total product revenues | 1,391.6 | 1,500.0 | 2,474.2 | 2,648.5 | |||||||||||
Related party product revenue as a percent of total product revenue | 32.7 | % | 31.0 | % | 30.6 | % | 30.1 | % |
|
(In Millions, Except Per Share Amounts) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Net Income from Continuing Operations attributable to Cliffs shareholders | $ | 146.0 | $ | 255.7 | $ | 253.0 | $ | 626.0 | |||||||
Income from Discontinued Operations, net of tax | — | 2.3 | — | 7.8 | |||||||||||
NET INCOME ATTRIBUTABLE TO CLIFFS SHAREHOLDERS | $ | 146.0 | $ | 258.0 | $ | 253.0 | $ | 633.8 | |||||||
PREFERRED STOCK DIVIDENDS | (12.9 | ) | — | (22.8 | ) | — | |||||||||
NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS | $ | 133.1 | $ | 258.0 | $ | 230.2 | $ | 633.8 | |||||||
Weighted Average Number of Shares: | |||||||||||||||
Basic | 153.0 | 142.4 | 150.4 | 142.3 | |||||||||||
Depositary Shares | 25.2 | — | 19.1 | — | |||||||||||
Employee Stock Plans | 0.2 | 0.4 | 0.2 | 0.5 | |||||||||||
Diluted | 178.4 | 142.8 | 169.7 | 142.8 | |||||||||||
Earnings per Common Share Attributable to Cliffs Shareholders - Basic: | |||||||||||||||
Continuing operations | $ | 0.87 | $ | 1.79 | $ | 1.53 | $ | 4.40 | |||||||
Discontinued operations | — | 0.02 | — | 0.05 | |||||||||||
$ | 0.87 | $ | 1.81 | $ | 1.53 | $ | 4.45 | ||||||||
Earnings per Common Share Attributable to Cliffs Shareholders - Diluted: | |||||||||||||||
Continuing operations | $ | 0.82 | $ | 1.79 | $ | 1.49 | $ | 4.39 | |||||||
Discontinued operations | — | 0.02 | — | 0.05 | |||||||||||
$ | 0.82 | $ | 1.81 | $ | 1.49 | $ | 4.44 |
|
|
(In Millions) | |||||||
Six Months Ended June 30, | |||||||
2013 | 2012 | ||||||
Capital additions | $ | 413.8 | $ | 619.5 | |||
Cash paid for capital expenditures | 501.2 | 517.0 | |||||
Difference | $ | (87.4 | ) | $ | 102.5 | ||
Non-cash accruals | $ | (87.4 | ) | $ | 53.1 | ||
Capital leases | — | 49.4 | |||||
Total | $ | (87.4 | ) | $ | 102.5 |
|
• | Joseph Carrabba will retire as president and chief executive officer effective no later than December 31, 2013. |
• | Laurie Brlas retired as executive vice president and president, global operations, effective July 9, 2013. |
• | James Kirsch was elected non-executive chairman of the Board, replacing Mr. Carrabba's former role as chairman. |
|
Name | Location | Ownership Interest | Operation | |||
Northshore | Minnesota | 100.0% | Iron Ore | |||
United Taconite | Minnesota | 100.0% | Iron Ore | |||
Wabush | Newfoundland and Labrador/Quebec, Canada | 100.0% | Iron Ore | |||
Bloom Lake | Quebec, Canada | 75.0% | Iron Ore | |||
Tilden | Michigan | 85.0% | Iron Ore | |||
Empire | Michigan | 79.0% | Iron Ore | |||
Koolyanobbing | Western Australia | 100.0% | Iron Ore | |||
Pinnacle | West Virginia | 100.0% | Coal | |||
Oak Grove | Alabama | 100.0% | Coal | |||
CLCC | West Virginia | 100.0% | Coal |
(In Millions) | ||||||||||||||
Investment | Classification | Accounting Method | Interest Percentage | June 30, 2013 | December 31, 2012 | |||||||||
Amapá | Investments in ventures | Equity Method | 30 | $ | 29.4 | $ | 101.9 | |||||||
Cockatoo | Other liabilities2 | Equity Method | — | N/A | (25.3 | ) | ||||||||
Hibbing | Investments in ventures1 | Equity Method | 23 | 6.4 | (2.1 | ) | ||||||||
Other | Investments in ventures | Equity Method | Various | 32.9 | 33.9 | |||||||||
$ | 68.7 | $ | 108.4 |
Intangible Assets | Basis | Useful Life (years) | ||
Permits - Asia Pacific Iron Ore | Units of production | Life of mine | ||
Permits - All Other | Straight line | 15 - 40 | ||
Utility contracts | Straight line | 5 | ||
Leases - North American Coal | Units of production | Life of mine | ||
Leases - All Other | Straight line | 4.5 - 17.5 |
|
Name | Location | Ownership Interest | Operation | |||
Northshore | Minnesota | 100.0% | Iron Ore | |||
United Taconite | Minnesota | 100.0% | Iron Ore | |||
Wabush | Newfoundland and Labrador/Quebec, Canada | 100.0% | Iron Ore | |||
Bloom Lake | Quebec, Canada | 75.0% | Iron Ore | |||
Tilden | Michigan | 85.0% | Iron Ore | |||
Empire | Michigan | 79.0% | Iron Ore | |||
Koolyanobbing | Western Australia | 100.0% | Iron Ore | |||
Pinnacle | West Virginia | 100.0% | Coal | |||
Oak Grove | Alabama | 100.0% | Coal | |||
CLCC | West Virginia | 100.0% | Coal |
(In Millions) | ||||||||||||||
Investment | Classification | Accounting Method | Interest Percentage | June 30, 2013 | December 31, 2012 | |||||||||
Amapá | Investments in ventures | Equity Method | 30 | $ | 29.4 | $ | 101.9 | |||||||
Cockatoo | Other liabilities2 | Equity Method | — | N/A | (25.3 | ) | ||||||||
Hibbing | Investments in ventures1 | Equity Method | 23 | 6.4 | (2.1 | ) | ||||||||
Other | Investments in ventures | Equity Method | Various | 32.9 | 33.9 | |||||||||
$ | 68.7 | $ | 108.4 |
Intangible Assets | Basis | Useful Life (years) | ||
Permits - Asia Pacific Iron Ore | Units of production | Life of mine | ||
Permits - All Other | Straight line | 15 - 40 | ||
Utility contracts | Straight line | 5 | ||
Leases - North American Coal | Units of production | Life of mine | ||
Leases - All Other | Straight line | 4.5 - 17.5 |
|
(In Millions) | |||||||||||||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||||||||||||
Revenues from product sales and services: | |||||||||||||||||||||||||||
U.S. Iron Ore | $ | 701.7 | 47 | % | $ | 705.0 | 45 | % | $ | 1,111.8 | 42 | % | $ | 1,146.7 | 41 | % | |||||||||||
Eastern Canadian Iron Ore | 213.9 | 14 | % | 303.9 | 19 | % | 459.2 | 17 | % | 524.6 | 19 | % | |||||||||||||||
Asia Pacific Iron Ore | 327.0 | 22 | % | 361.3 | 23 | % | 597.8 | 23 | % | 721.1 | 26 | % | |||||||||||||||
North American Coal | 245.9 | 17 | % | 209.2 | 13 | % | 460.2 | 18 | % | 399.2 | 14 | % | |||||||||||||||
Other | — | — | % | — | — | % | — | — | % | 0.1 | — | % | |||||||||||||||
Total revenues from product sales and services | $ | 1,488.5 | 100 | % | $ | 1,579.4 | 100 | % | $ | 2,629.0 | 100 | % | $ | 2,791.7 | 100 | % | |||||||||||
Sales margin: | |||||||||||||||||||||||||||
U.S. Iron Ore | $ | 216.3 | $ | 286.1 | $ | 373.6 | $ | 452.9 | |||||||||||||||||||
Eastern Canadian Iron Ore | (49.7 | ) | 11.7 | (30.3 | ) | (2.6 | ) | ||||||||||||||||||||
Asia Pacific Iron Ore | 95.0 | 146.8 | 156.3 | 271.9 | |||||||||||||||||||||||
North American Coal | 6.6 | (9.6 | ) | 8.4 | 5.0 | ||||||||||||||||||||||
Other | — | 8.4 | (1.9 | ) | 8.0 | ||||||||||||||||||||||
Sales margin | 268.2 | 443.4 | 506.1 | 735.2 | |||||||||||||||||||||||
Other operating expense | (6.2 | ) | (81.5 | ) | (75.8 | ) | (150.3 | ) | |||||||||||||||||||
Other income (expense) | (43.5 | ) | (47.5 | ) | (91.5 | ) | (90.8 | ) | |||||||||||||||||||
Income from continuing operations before income taxes and equity loss from ventures | $ | 218.5 | $ | 314.4 | $ | 338.8 | $ | 494.1 | |||||||||||||||||||
Depreciation, depletion and amortization: | |||||||||||||||||||||||||||
U.S. Iron Ore | $ | 28.4 | $ | 23.8 | $ | 55.0 | $ | 47.0 | |||||||||||||||||||
Eastern Canadian Iron Ore | 42.4 | 38.6 | 83.5 | 76.5 | |||||||||||||||||||||||
Asia Pacific Iron Ore | 41.7 | 39.8 | 78.1 | 69.8 | |||||||||||||||||||||||
North American Coal | 28.4 | 24.3 | 60.9 | 44.4 | |||||||||||||||||||||||
Other | 3.4 | 5.6 | 7.4 | 11.7 | |||||||||||||||||||||||
Total depreciation, depletion and amortization | $ | 144.3 | $ | 132.1 | $ | 284.9 | $ | 249.4 | |||||||||||||||||||
Capital additions (1): | |||||||||||||||||||||||||||
U.S. Iron Ore | $ | 12.2 | $ | 28.1 | $ | 23.9 | $ | 62.9 | |||||||||||||||||||
Eastern Canadian Iron Ore | 186.8 | 177.3 | 353.8 | 307.9 | |||||||||||||||||||||||
Asia Pacific Iron Ore | 2.3 | 16.9 | 6.6 | 126.2 | |||||||||||||||||||||||
North American Coal | 15.7 | 32.7 | 26.8 | 71.8 | |||||||||||||||||||||||
Other | 1.1 | 11.1 | 2.7 | 50.7 | |||||||||||||||||||||||
Total capital additions | $ | 218.1 | $ | 266.1 | $ | 413.8 | $ | 619.5 |
(In Millions) | |||||||
June 30, 2013 | December 31, 2012 | ||||||
Assets: | |||||||
U.S. Iron Ore | $ | 1,791.6 | $ | 1,735.1 | |||
Eastern Canadian Iron Ore | 7,860.8 | 7,605.1 | |||||
Asia Pacific Iron Ore | 1,261.6 | 1,506.3 | |||||
North American Coal | 1,867.7 | 1,877.8 | |||||
Other | 643.9 | 570.9 | |||||
Total segment assets | 13,425.6 | 13,295.2 | |||||
Corporate | 169.3 | 279.7 | |||||
Total assets | $ | 13,594.9 | $ | 13,574.9 |
|
(In Millions) | |||||||||||||||||||||||
Derivative Assets | Derivative Liabilities | ||||||||||||||||||||||
June 30, 2013 | December 31, 2012 | June 30, 2013 | December 31, 2012 | ||||||||||||||||||||
Derivative Instrument | Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | |||||||||||||||
Derivatives designated as hedging instruments under ASC 815: | |||||||||||||||||||||||
Foreign Exchange Contracts | $ | — | Derivative assets | $ | 16.2 | Derivative liabilities | $ | 56.6 | Derivative liabilities | $ | 1.9 | ||||||||||||
Total derivatives designated as hedging instruments under ASC 815 | $ | — | $ | 16.2 | $ | 56.6 | $ | 1.9 | |||||||||||||||
Derivatives not designated as hedging instruments under ASC 815: | |||||||||||||||||||||||
Customer Supply Agreements | Derivative assets | $ | 44.2 | Derivative assets | $ | 58.9 | $ | — | $ | — | |||||||||||||
Provisional Pricing Arrangements | Derivative assets | 0.9 | Derivative assets | 3.5 | Derivative liabilities | 32.0 | Derivative liabilities | 11.3 | |||||||||||||||
Total derivatives not designated as hedging instruments under ASC 815 | $ | 45.1 | $ | 62.4 | $ | 32.0 | $ | 11.3 | |||||||||||||||
Total derivatives | $ | 45.1 | $ | 78.6 | $ | 88.6 | $ | 13.2 |
(In Millions) | |||||||||||||||||
Derivatives in Cash Flow | Amount of Gain (Loss) Recognized in OCI on Derivative | Location of Gain (Loss) Reclassified from Accumulated OCI into Earnings | Amount of Gain (Loss) Reclassified from Accumulated OCI into Earnings | ||||||||||||||
Hedging Relationships | (Effective Portion) | (Effective Portion) | (Effective Portion) | ||||||||||||||
Three Months Ended June 30, | Three Months Ended June 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
Australian Dollar Foreign Exchange Contracts (hedge designation) | $ | (31.3 | ) | $ | 2.1 | Product revenues | $ | 2.6 | $ | (0.4 | ) | ||||||
Canadian Dollar Foreign Exchange Contracts (hedge designation) | (10.9 | ) | (5.9 | ) | Cost of goods sold and operating expenses | (0.4 | ) | (0.2 | ) | ||||||||
Total | $ | (42.2 | ) | $ | (3.8 | ) | $ | 2.2 | $ | (0.6 | ) | ||||||
Six Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
Australian Dollar Foreign Exchange Contracts (hedge designation) | $ | (28.1 | ) | $ | 5.1 | Product revenues | $ | 4.4 | $ | 2.7 | |||||||
Canadian Dollar Foreign Exchange Contracts (hedge designation) | (19.1 | ) | (5.2 | ) | Cost of goods sold and operating expenses | (0.2 | ) | 0.3 | |||||||||
$ | (47.2 | ) | $ | (0.1 | ) | $ | 4.2 | $ | 3.0 |
(In Millions) | ||||||||||||||||
Derivatives Not Designated as Hedging Instruments | Location of Gain (Loss) Recognized in Income on Derivative | Amount of Gain/(Loss) Recognized in Income on Derivative | ||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Foreign Exchange Contracts | Other income (expense) | $ | — | $ | — | $ | — | $ | 0.3 | |||||||
Customer Supply Agreements | Product revenues | 35.4 | 42.6 | 59.5 | 82.0 | |||||||||||
Provisional Pricing Arrangements | Product revenues | (28.2 | ) | 98.3 | (31.1 | ) | 98.3 | |||||||||
Total | $ | 7.2 | $ | 140.9 | $ | 28.4 | $ | 180.6 |
|
(In Millions) | |||||||||||||||||||||||
June 30, 2013 | December 31, 2012 | ||||||||||||||||||||||
Segment | Finished Goods | Work-in Process | Total Inventory | Finished Goods | Work-in Process | Total Inventory | |||||||||||||||||
U.S. Iron Ore | $ | 242.1 | $ | 22.2 | $ | 264.3 | $ | 147.2 | $ | 22.9 | $ | 170.1 | |||||||||||
Eastern Canadian Iron Ore | 94.0 | 36.5 | 130.5 | 62.6 | 44.2 | 106.8 | |||||||||||||||||
Asia Pacific Iron Ore | 51.6 | 28.4 | 80.0 | 36.7 | 37.2 | 73.9 | |||||||||||||||||
North American Coal | 40.2 | 14.2 | 54.4 | 36.7 | 49.0 | 85.7 | |||||||||||||||||
Total | $ | 427.9 | $ | 101.3 | $ | 529.2 | $ | 283.2 | $ | 153.3 | $ | 436.5 |
|
(In Millions) | |||||||
June 30, 2013 | December 31, 2012 | ||||||
Land rights and mineral rights | $ | 7,807.6 | $ | 7,920.8 | |||
Office and information technology | 118.8 | 92.4 | |||||
Buildings | 184.9 | 162.0 | |||||
Mining equipment | 1,401.3 | 1,290.7 | |||||
Processing equipment | 2,069.5 | 1,937.4 | |||||
Railroad equipment | 218.9 | 240.8 | |||||
Electric power facilities | 62.1 | 58.7 | |||||
Port facilities | 100.7 | 114.3 | |||||
Interest capitalized during construction | 23.1 | 20.8 | |||||
Land improvements | 60.0 | 43.9 | |||||
Other | 37.5 | 39.0 | |||||
Construction in progress | 1,131.6 | 1,123.9 | |||||
13,216.0 | 13,044.7 | ||||||
Allowance for depreciation and depletion | (2,026.4 | ) | (1,837.4 | ) | |||
$ | 11,189.6 | $ | 11,207.3 |
|
(In Millions) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
REVENUES FROM PRODUCT SALES AND SERVICES | |||||||||||||||
Product | $ | — | $ | 46.6 | $ | — | $ | 99.0 | |||||||
INCOME FROM DISCONTINUED OPERATIONS, net of tax | $ | — | $ | 2.3 | $ | — | $ | 7.8 |
|
(In Millions) | |||||||||||||||||||||||||||||||||||||||||||||||
June 30, 2013 | December 31, 2012 | ||||||||||||||||||||||||||||||||||||||||||||||
U.S. Iron Ore | Eastern Canadian Iron Ore | Asia Pacific Iron Ore | North American Coal | Other | Total | U.S. Iron Ore | Eastern Canadian Iron Ore | Asia Pacific Iron Ore | North American Coal | Other | Total | ||||||||||||||||||||||||||||||||||||
Beginning Balance | $ | 2.0 | $ | — | $ | 84.5 | $ | — | $ | 80.9 | $ | 167.4 | $ | 2.0 | $ | 986.2 | $ | 83.0 | $ | — | $ | 80.9 | $ | 1,152.1 | |||||||||||||||||||||||
Arising in business combinations | — | — | — | — | — | — | — | 13.8 | — | — | — | 13.8 | |||||||||||||||||||||||||||||||||||
Impairment | — | — | — | — | — | — | — | (1,000.0 | ) | — | — | — | (1,000.0 | ) | |||||||||||||||||||||||||||||||||
Impact of foreign currency translation | — | — | (10.2 | ) | — | — | (10.2 | ) | — | — | 1.5 | — | — | 1.5 | |||||||||||||||||||||||||||||||||
Ending Balance | $ | 2.0 | $ | — | $ | 74.3 | $ | — | $ | 80.9 | $ | 157.2 | $ | 2.0 | $ | — | $ | 84.5 | $ | — | $ | 80.9 | $ | 167.4 | |||||||||||||||||||||||
Accumulated Goodwill Impairment Loss | $ | — | $ | (1,000.0 | ) | $ | — | $ | (27.8 | ) | $ | — | $ | (1,027.8 | ) | $ | — | $ | (1,000.0 | ) | $ | — | $ | (27.8 | ) | $ | — | $ | (1,027.8 | ) |
(In Millions) | |||||||||||||||||||||||||
June 30, 2013 | December 31, 2012 | ||||||||||||||||||||||||
Classification | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | |||||||||||||||||||
Definite-lived intangible assets: | |||||||||||||||||||||||||
Permits | Intangible assets, net | $ | 129.3 | $ | (33.3 | ) | $ | 96.0 | $ | 136.1 | $ | (31.7 | ) | $ | 104.4 | ||||||||||
Utility contracts | Intangible assets, net | 54.7 | (38.0 | ) | 16.7 | 54.7 | (32.4 | ) | 22.3 | ||||||||||||||||
Leases | Intangible assets, net | 5.7 | (3.4 | ) | 2.3 | 5.7 | (3.4 | ) | 2.3 | ||||||||||||||||
Total intangible assets | $ | 189.7 | $ | (74.7 | ) | $ | 115.0 | $ | 196.5 | $ | (67.5 | ) | $ | 129.0 | |||||||||||
Below-market sales contracts | Other current liabilities | $ | (46.0 | ) | $ | 7.6 | $ | (38.4 | ) | $ | (46.0 | ) | $ | — | $ | (46.0 | ) | ||||||||
Below-market sales contracts | Other liabilities | (250.7 | ) | 190.6 | (60.1 | ) | (250.7 | ) | 181.6 | (69.1 | ) | ||||||||||||||
Total below-market sales contracts | $ | (296.7 | ) | $ | 198.2 | $ | (98.5 | ) | $ | (296.7 | ) | $ | 181.6 | $ | (115.1 | ) |
(In Millions) | |||
Amount | |||
Year Ending December 31 | |||
2013 (remaining six months) | $ | 11.0 | |
2014 | 19.3 | ||
2015 | 8.5 | ||
2016 | 8.4 | ||
2017 | 8.4 | ||
2018 | 7.8 | ||
Total | $ | 63.4 |
(In Millions) | |||
Amount | |||
Year Ending December 31 | |||
2013 (remaining six months) | $ | 29.4 | |
2014 | 23.1 | ||
2015 | 23.0 | ||
2016 | 23.0 | ||
Total | $ | 98.5 |
|
(In Millions) | |||||||||||||||
June 30, 2013 | |||||||||||||||
Description | Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | |||||||||||
Assets: | |||||||||||||||
Cash equivalents | $ | 140.0 | $ | — | $ | — | $ | 140.0 | |||||||
Derivative assets | — | — | 45.1 | 45.1 | |||||||||||
Marketable securities | 23.2 | — | — | 23.2 | |||||||||||
Foreign exchange contracts | — | — | — | — | |||||||||||
Total | $ | 163.2 | $ | — | $ | 45.1 | $ | 208.3 | |||||||
Liabilities: | |||||||||||||||
Derivative liabilities | $ | — | $ | — | $ | 32.0 | $ | 32.0 | |||||||
Foreign exchange contracts | — | 56.6 | — | 56.6 | |||||||||||
Total | $ | — | $ | 56.6 | $ | 32.0 | $ | 88.6 |
(In Millions) | |||||||||||||||
December 31, 2012 | |||||||||||||||
Description | Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | |||||||||||
Assets: | |||||||||||||||
Cash equivalents | $ | 100.0 | $ | — | $ | — | $ | 100.0 | |||||||
Derivative assets | — | — | 62.4 | 62.4 | |||||||||||
Marketable securities | 27.0 | — | — | 27.0 | |||||||||||
Foreign exchange contracts | — | 16.2 | — | 16.2 | |||||||||||
Total | $ | 127.0 | $ | 16.2 | $ | 62.4 | $ | 205.6 | |||||||
Liabilities: | |||||||||||||||
Derivative liabilities | $ | — | $ | — | $ | 11.3 | $ | 11.3 | |||||||
Foreign exchange contracts | — | 1.9 | — | 1.9 | |||||||||||
Total | $ | — | $ | 1.9 | $ | 11.3 | $ | 13.2 |
Qualitative/Quantitative Information About Level 3 Fair Value Measurements | ||||||||||||
($ in millions) | Fair Value at | Balance Sheet Location | Valuation Technique | Unobservable Input | Range or Point Estimate (Weighted Average) | |||||||
6/30/2013 | ||||||||||||
Provisional Pricing Arrangements | $ | 0.9 | Derivative assets | Market Approach | Managements Estimate of 62% Fe | $116 | ||||||
$ | 32.0 | Derivative liabilities | ||||||||||
Customer Supply Agreement | $ | 44.2 | Derivative assets | Market Approach | Hot-Rolled Steel Estimate | $580 - $630 ($615) |
(In Millions) | |||||||||||||||
Derivative Assets (Level 3) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Beginning balance | $ | 53.3 | $ | 69.2 | $ | 62.4 | $ | 157.9 | |||||||
Total gains | |||||||||||||||
Included in earnings | 32.4 | 61.4 | 60.4 | 104.7 | |||||||||||
Settlements | (40.6 | ) | (46.7 | ) | (77.7 | ) | (178.7 | ) | |||||||
Transfers into Level 3 | — | — | — | — | |||||||||||
Transfers out of Level 3 | — | — | — | — | |||||||||||
Ending balance - June 30 | $ | 45.1 | $ | 83.9 | $ | 45.1 | $ | 83.9 | |||||||
Total gains for the period included in earnings attributable to the change in unrealized gains on assets still held at the reporting date | $ | 32.4 | $ | 61.4 | $ | 60.4 | $ | 104.7 |
(In Millions) | |||||||||||||||
Derivative Liabilities (Level 3) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Beginning balance | $ | (6.8 | ) | $ | (1.1 | ) | $ | (11.3 | ) | $ | (19.5 | ) | |||
Total gains | |||||||||||||||
Included in earnings | (25.2 | ) | (14.7 | ) | (32.0 | ) | (15.8 | ) | |||||||
Settlements | — | — | 11.3 | 19.5 | |||||||||||
Transfers into Level 3 | — | — | — | — | |||||||||||
Transfers out of Level 3 | — | — | — | — | |||||||||||
Ending balance - June 30 | $ | (32.0 | ) | $ | (15.8 | ) | $ | (32.0 | ) | $ | (15.8 | ) | |||
Total gains (losses) for the period included in earnings attributable to the change in unrealized gains (losses) on liabilities still held at the reporting date | $ | (25.2 | ) | $ | (14.7 | ) | $ | (32.0 | ) | $ | (15.8 | ) |
(In Millions) | |||||||||||||||||
June 30, 2013 | December 31, 2012 | ||||||||||||||||
Classification | Carrying Value | Fair Value | Carrying Value | Fair Value | |||||||||||||
Other receivables: | |||||||||||||||||
Customer supplemental payments | Level 2 | $ | — | $ | — | $ | 22.3 | $ | 21.3 | ||||||||
ArcelorMittal USA—Receivable | Level 2 | 15.4 | 16.7 | 19.3 | 21.3 | ||||||||||||
Other | Level 2 | 9.8 | 9.8 | 10.9 | 10.9 | ||||||||||||
Total receivables | $ | 25.2 | $ | 26.5 | $ | 52.5 | $ | 53.5 | |||||||||
Long-term debt: | |||||||||||||||||
Term loan—$1.25 billion | Level 2 | $ | — | $ | — | $ | 753.0 | $ | 753.0 | ||||||||
Senior notes—$700 million | Level 2 | 699.4 | 718.9 | 699.4 | 759.4 | ||||||||||||
Senior notes—$1.3 billion | Level 2 | 1,289.5 | 1,450.6 | 1,289.4 | 1,524.7 | ||||||||||||
Senior notes—$400 million | Level 2 | 398.3 | 440.5 | 398.2 | 464.3 | ||||||||||||
Senior notes—$500 million | Level 2 | 496.1 | 514.7 | 495.7 | 528.4 | ||||||||||||
Revolving loan | Level 2 | 440.0 | 440.0 | 325.0 | 325.0 | ||||||||||||
Total long-term debt | $ | 3,323.3 | $ | 3,564.7 | $ | 3,960.7 | $ | 4,354.8 |
(In Millions) | ||||||||||||||
June 30, 2012 | ||||||||||||||
Description | Quoted Prices in Active Markets for Identical Assets/ Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | Total Losses | |||||||||
Assets: | ||||||||||||||
Investment in ventures impairment - Amapá | — | — | — | $ | — | $ | 67.6 |
(In Millions) | ||||||||||||||||
December 31, 2012 | ||||||||||||||||
Description | Quoted Prices in Active Markets for Identical Assets/ Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | ||||||||||||
Assets: | ||||||||||||||||
Investment in ventures impairment - Amapá | $ | — | $ | — | $ | 72.5 | $ | 72.5 |
|
($ in Millions) | |||||||||||||||
June 30, 2013 | |||||||||||||||
Debt Instrument | Type | Annual Effective Interest Rate | Final Maturity | Total Face Amount | Total Debt | ||||||||||
$700 Million 4.875% 2021 Senior Notes | Fixed | 4.89% | 2021 | $ | 700.0 | $ | 699.4 | (2) | |||||||
$1.3 Billion Senior Notes: | |||||||||||||||
$500 Million 4.80% 2020 Senior Notes | Fixed | 4.83% | 2020 | 500.0 | 499.2 | (3) | |||||||||
$800 Million 6.25% 2040 Senior Notes | Fixed | 6.34% | 2040 | 800.0 | 790.3 | (4) | |||||||||
$400 Million 5.90% 2020 Senior Notes | Fixed | 5.98% | 2020 | 400.0 | 398.3 | (5) | |||||||||
$500 Million 3.95% 2018 Senior Notes | Fixed | 4.14% | 2018 | 500.0 | 496.1 | (6) | |||||||||
$1.75 Billion Credit Facility: | |||||||||||||||
Revolving Loan | Variable | 2.05% | 2017 | 1,750.0 | 440.0 | (7) | |||||||||
Total debt | $ | 4,650.0 | $ | 3,323.3 | |||||||||||
Less current portion | — | ||||||||||||||
Long-term debt | $ | 3,323.3 |
($ in Millions) | |||||||||||||||
December 31, 2012 | |||||||||||||||
Debt Instrument | Type | Annual Effective Interest Rate | Final Maturity | Total Face Amount | Total Debt | ||||||||||
$1.25 Billion Term Loan | Variable | 1.83% | 2016 | $ | 847.1 | (1) | $ | 847.1 | (1) | ||||||
$700 Million 4.875% 2021 Senior Notes | Fixed | 4.88% | 2021 | 700.0 | 699.4 | (2) | |||||||||
$1.3 Billion Senior Notes: | |||||||||||||||
$500 Million 4.80% 2020 Senior Notes | Fixed | 4.80% | 2020 | 500.0 | 499.2 | (3) | |||||||||
$800 Million 6.25% 2040 Senior Notes | Fixed | 6.25% | 2040 | 800.0 | 790.2 | (4) | |||||||||
$400 Million 5.90% 2020 Senior Notes | Fixed | 5.90% | 2020 | 400.0 | 398.2 | (5) | |||||||||
$500 Million 3.95% 2018 Senior Notes | Fixed | 4.14% | 2018 | 500.0 | 495.7 | (6) | |||||||||
$1.75 Billion Credit Facility: | |||||||||||||||
Revolving Loan | Variable | 2.02% | 2017 | 1,750.0 | 325.0 | (7) | |||||||||
Total debt | $ | 5,497.1 | $ | 4,054.8 | |||||||||||
Less current portion | 94.1 | ||||||||||||||
Long-term debt | $ | 3,960.7 |
(1) | During the first quarter of 2013 the term loan was repaid in full through repayments totaling $847.1 million. As of December 31, 2012, $402.8 million had been paid down on the original $1.25 billion term loan and, of the remaining term loan $94.1 million, was classified as Current portion of debt. The current classification was based upon the principal payment terms of the arrangement requiring principal payments on each three-month anniversary following the funding of the term loan. |
(2) | As of June 30, 2013 and December 31, 2012, the $700 million 4.875 percent senior notes were recorded at a par value of $700 million less unamortized discounts of $0.6 million for each period, based on an imputed interest rate of 4.89 percent. |
(3) | As of June 30, 2013 and December 31, 2012, the $500 million 4.80 percent senior notes were recorded at a par value of $500 million less unamortized discounts of $0.8 million for each period, based on an imputed interest rate of 4.83 percent. |
(4) | As of June 30, 2013 and December 31, 2012, the $800 million 6.25 percent senior notes were recorded at par value of $800 million less unamortized discounts of $9.7 million and $9.8 million, respectively, based on an imputed interest rate of 6.34 percent. |
(5) | As of June 30, 2013 and December 31, 2012, the $400 million 5.90 percent senior notes were recorded at a par value of $400 million less unamortized discounts of $1.7 million and $1.8 million, respectively, based on an imputed interest rate of 5.98 percent. |
(6) | As of June 30, 2013 and December 31, 2012, the $500 million 3.95 percent senior notes were recorded at a par value of $500 million less unamortized discounts of $3.9 million and $4.3 million, respectively, based on an imputed interest rate of 4.14 percent. |
(7) | As of June 30, 2013 and December 31, 2012, $440.0 million and $325.0 million revolving loans were drawn under the credit facility, respectively, and the principal amount of letter of credit obligations totaled $27.7 million for each period, thereby reducing available borrowing capacity to $1.3 billion and $1.4 billion for each period, respectively. |
(In Millions) | |||
Maturities of Debt | |||
2013 (July 1 - December 31) | $ | — | |
2014 | — | ||
2015 | — | ||
2016 | — | ||
2017 | — | ||
2018 and thereafter | 2,900.0 | ||
Total maturities of debt | $ | 2,900.0 |
|
(In Millions) | |||||||
Capital Leases | Operating Leases | ||||||
2013 (July 1 - December 31) | $ | 35.8 | $ | 13.4 | |||
2014 | 65.0 | 20.1 | |||||
2015 | 53.6 | 13.4 | |||||
2016 | 38.2 | 8.3 | |||||
2017 | 31.1 | 7.5 | |||||
2018 and thereafter | 84.6 | 21.5 | |||||
Total minimum lease payments | $ | 308.3 | $ | 84.2 | |||
Amounts representing interest | 63.3 | ||||||
Present value of net minimum lease payments | $ | 245.0 | (1) |
(1) | The total is comprised of $50.5 million and $194.5 million classified as Other current liabilities and Other liabilities, respectively, in the Statements of Unaudited Condensed Consolidated Financial Position at June 30, 2013. |
|
(In Millions) | |||||||
June 30, 2013 | December 31, 2012 | ||||||
Environmental | $ | 9.1 | $ | 15.7 | |||
Mine closure | |||||||
LTVSMC | 19.1 | 18.3 | |||||
Operating mines: | |||||||
U.S. Iron Ore | 85.1 | 81.2 | |||||
Eastern Canadian Iron Ore | 75.0 | 88.9 | |||||
Asia Pacific Iron Ore | 20.2 | 22.4 | |||||
North American Coal | 39.5 | 38.6 | |||||
Total mine closure | 238.9 | 249.4 | |||||
Total environmental and mine closure obligations | 248.0 | 265.1 | |||||
Less current portion | 12.2 | 12.3 | |||||
Long term environmental and mine closure obligations | $ | 235.8 | $ | 252.8 |
(In Millions) | ||||||||
June 30, 2013 | December 31, 2012 | (1) | ||||||
Asset retirement obligation at beginning of period | $ | 231.1 | $ | 194.9 | ||||
Accretion expense | 9.0 | 17.6 | ||||||
Exchange rate changes | (2.9 | ) | 0.3 | |||||
Revision in estimated cash flows | (17.1 | ) | 18.2 | |||||
Payments | (0.3 | ) | 0.1 | |||||
Asset retirement obligation at end of period | $ | 219.8 | $ | 231.1 |
(1) | Represents a 12-month rollforward of our asset retirement obligation at December 31, 2012. |
|
(In Millions) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Service cost | $ | 9.7 | $ | 8.0 | $ | 19.6 | $ | 16.0 | |||||||
Interest cost | 11.7 | 12.3 | 23.2 | 24.3 | |||||||||||
Expected return on plan assets | (20.0 | ) | (15.0 | ) | (33.1 | ) | (29.8 | ) | |||||||
Amortization: | |||||||||||||||
Prior service costs | 0.8 | 0.9 | 1.5 | 1.9 | |||||||||||
Net actuarial loss | 8.2 | 7.6 | 15.0 | 15.0 | |||||||||||
Net periodic benefit cost | $ | 10.4 | $ | 13.8 | $ | 26.2 | $ | 27.4 |
(In Millions) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Service cost | $ | 3.1 | $ | 3.9 | $ | 6.2 | $ | 7.5 | |||||||
Interest cost | 4.4 | 5.4 | 8.7 | 10.6 | |||||||||||
Expected return on plan assets | (5.0 | ) | (4.3 | ) | (10.0 | ) | (8.6 | ) | |||||||
Amortization: | |||||||||||||||
Prior service costs | (0.9 | ) | 0.8 | (1.8 | ) | 1.5 | |||||||||
Net actuarial loss | 3.0 | 2.7 | 5.8 | 5.6 | |||||||||||
Net periodic benefit cost | $ | 4.6 | $ | 8.5 | $ | 8.9 | $ | 16.6 |
|
Grant Date | Grant Date Market Price | Average Expected Term (Years) | Expected Volatility | Risk-Free Interest Rate | Dividend Yield | Fair Value | Fair Value (Percent of Grant Date Market Price) | |||||||||||
March 11, 2013 | $ | 23.83 | 2.81 | 52.9% | 0.40% | 2.52% | $ | 17.01 | 71.38% |
|
Mine | Cliffs Natural Resources | ArcelorMittal | U.S. Steel Canada | WISCO | ||||
Empire | 79.0 | 21.0 | — | — | ||||
Tilden | 85.0 | — | 15.0 | — | ||||
Hibbing | 23.0 | 62.3 | 14.7 | — | ||||
Bloom Lake | 75.0 | — | — | 25.0 |
(In Millions) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Product revenues from related parties | $ | 455.0 | $ | 465.4 | $ | 756.2 | $ | 797.3 | |||||||
Total product revenues | 1,391.6 | 1,500.0 | 2,474.2 | 2,648.5 | |||||||||||
Related party product revenue as a percent of total product revenue | 32.7 | % | 31.0 | % | 30.6 | % | 30.1 | % |
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(In Millions, Except Per Share Amounts) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Net Income from Continuing Operations attributable to Cliffs shareholders | $ | 146.0 | $ | 255.7 | $ | 253.0 | $ | 626.0 | |||||||
Income from Discontinued Operations, net of tax | — | 2.3 | — | 7.8 | |||||||||||
NET INCOME ATTRIBUTABLE TO CLIFFS SHAREHOLDERS | $ | 146.0 | $ | 258.0 | $ | 253.0 | $ | 633.8 | |||||||
PREFERRED STOCK DIVIDENDS | (12.9 | ) | — | (22.8 | ) | — | |||||||||
NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS | $ | 133.1 | $ | 258.0 | $ | 230.2 | $ | 633.8 | |||||||
Weighted Average Number of Shares: | |||||||||||||||
Basic | 153.0 | 142.4 | 150.4 | 142.3 | |||||||||||
Depositary Shares | 25.2 | — | 19.1 | — | |||||||||||
Employee Stock Plans | 0.2 | 0.4 | 0.2 | 0.5 | |||||||||||
Diluted | 178.4 | 142.8 | 169.7 | 142.8 | |||||||||||
Earnings per Common Share Attributable to Cliffs Shareholders - Basic: | |||||||||||||||
Continuing operations | $ | 0.87 | $ | 1.79 | $ | 1.53 | $ | 4.40 | |||||||
Discontinued operations | — | 0.02 | — | 0.05 | |||||||||||
$ | 0.87 | $ | 1.81 | $ | 1.53 | $ | 4.45 | ||||||||
Earnings per Common Share Attributable to Cliffs Shareholders - Diluted: | |||||||||||||||
Continuing operations | $ | 0.82 | $ | 1.79 | $ | 1.49 | $ | 4.39 | |||||||
Discontinued operations | — | 0.02 | — | 0.05 | |||||||||||
$ | 0.82 | $ | 1.81 | $ | 1.49 | $ | 4.44 |
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(In Millions) | |||||||
Six Months Ended June 30, | |||||||
2013 | 2012 | ||||||
Capital additions | $ | 413.8 | $ | 619.5 | |||
Cash paid for capital expenditures | 501.2 | 517.0 | |||||
Difference | $ | (87.4 | ) | $ | 102.5 | ||
Non-cash accruals | $ | (87.4 | ) | $ | 53.1 | ||
Capital leases | — | 49.4 | |||||
Total | $ | (87.4 | ) | $ | 102.5 |
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