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Name | Location | Ownership Interest | Operation | Status of Operations | ||||
Northshore | Minnesota | 100.0% | Iron Ore | Active | ||||
United Taconite | Minnesota | 100.0% | Iron Ore | Active | ||||
Tilden | Michigan | 85.0% | Iron Ore | Active | ||||
Empire | Michigan | 79.0% | Iron Ore | Active | ||||
Koolyanobbing | Western Australia | 100.0% | Iron Ore | Active |
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(In Millions) | |||||||||||||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||||||||||||||
Revenues from product sales and services: | |||||||||||||||||||||||||||
U.S. Iron Ore | $ | 361.7 | 73 | % | $ | 369.7 | 74 | % | $ | 547.2 | 68 | % | $ | 681.5 | 72 | % | |||||||||||
Asia Pacific Iron Ore | 134.5 | 27 | % | 128.4 | 26 | % | 254.5 | 32 | % | 262.6 | 28 | % | |||||||||||||||
Total revenues from product sales and services | $ | 496.2 | 100 | % | $ | 498.1 | 100 | % | $ | 801.7 | 100 | % | $ | 944.1 | 100 | % | |||||||||||
Sales margin: | |||||||||||||||||||||||||||
U.S. Iron Ore | $ | 70.0 | $ | 49.0 | $ | 83.2 | $ | 129.0 | |||||||||||||||||||
Asia Pacific Iron Ore | 21.5 | 8.3 | 39.2 | 9.1 | |||||||||||||||||||||||
Sales margin | 91.5 | 57.3 | 122.4 | 138.1 | |||||||||||||||||||||||
Other operating expense | (16.8 | ) | (31.6 | ) | (48.0 | ) | (40.5 | ) | |||||||||||||||||||
Other income (expense) | (46.9 | ) | (65.7 | ) | 75.2 | 204.3 | |||||||||||||||||||||
Income (loss) from continuing operations before income taxes | $ | 27.8 | $ | (40.0 | ) | $ | 149.6 | $ | 301.9 |
(In Millions) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Net Income (Loss) | $ | 29.5 | $ | 65.2 | $ | 146.3 | $ | (696.5 | ) | ||||||
Less: | |||||||||||||||
Interest expense, net | (50.7 | ) | (64.3 | ) | (107.5 | ) | (108.5 | ) | |||||||
Income tax benefit (expense) | 2.1 | 2.9 | (5.4 | ) | (172.1 | ) | |||||||||
Depreciation, depletion and amortization | (26.9 | ) | (30.5 | ) | (62.1 | ) | (63.5 | ) | |||||||
EBITDA | $ | 105.0 | $ | 157.1 | $ | 321.3 | $ | (352.4 | ) | ||||||
Less: | |||||||||||||||
Impact of discontinued operations | (0.4 | ) | 103.0 | 2.1 | (821.1 | ) | |||||||||
Gain on extinguishment/restructuring of debt | 3.6 | — | 182.4 | 313.7 | |||||||||||
Severance and contractor termination costs | — | (10.0 | ) | (0.1 | ) | (11.6 | ) | ||||||||
Foreign exchange remeasurement | 0.2 | (0.8 | ) | (0.9 | ) | 12.7 | |||||||||
Adjusted EBITDA | $ | 101.6 | $ | 64.9 | $ | 137.8 | $ | 153.9 | |||||||
EBITDA: | |||||||||||||||
U.S. Iron Ore | $ | 94.1 | $ | 68.8 | $ | 135.5 | $ | 170.4 | |||||||
Asia Pacific Iron Ore | 26.1 | 9.6 | 48.4 | 27.6 | |||||||||||
Other | (15.2 | ) | 78.7 | 137.4 | (550.4 | ) | |||||||||
Total EBITDA | $ | 105.0 | $ | 157.1 | $ | 321.3 | $ | (352.4 | ) | ||||||
Adjusted EBITDA: | |||||||||||||||
U.S. Iron Ore | $ | 97.2 | $ | 77.2 | $ | 143.3 | $ | 182.3 | |||||||
Asia Pacific Iron Ore | 26.5 | 17.4 | 49.5 | 23.1 | |||||||||||
Other | (22.1 | ) | (29.7 | ) | (55.0 | ) | (51.5 | ) | |||||||
Total Adjusted EBITDA | $ | 101.6 | $ | 64.9 | $ | 137.8 | $ | 153.9 |
(In Millions) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Depreciation, depletion and amortization: | |||||||||||||||
U.S. Iron Ore | $ | 19.4 | $ | 22.0 | $ | 46.3 | $ | 43.7 | |||||||
Asia Pacific Iron Ore | 6.1 | 6.7 | 12.9 | 13.0 | |||||||||||
Other | 1.4 | 1.8 | 2.9 | 3.6 | |||||||||||
Total depreciation, depletion and amortization | $ | 26.9 | $ | 30.5 | $ | 62.1 | $ | 60.3 | |||||||
Capital additions1: | |||||||||||||||
U.S. Iron Ore | $ | 9.2 | $ | 11.3 | $ | 13.7 | $ | 20.8 | |||||||
Asia Pacific Iron Ore | — | 1.1 | — | 4.5 | |||||||||||
Other | 2.1 | 3.2 | 4.4 | 3.6 | |||||||||||
Total capital additions | $ | 11.3 | $ | 15.6 | $ | 18.1 | $ | 28.9 |
(In Millions) | |||||||
June 30, 2016 | December 31, 2015 | ||||||
Assets: | |||||||
U.S. Iron Ore | $ | 1,510.3 | $ | 1,476.4 | |||
Asia Pacific Iron Ore | 166.4 | 202.5 | |||||
Total segment assets | 1,676.7 | 1,678.9 | |||||
Corporate | 174.3 | 441.7 | |||||
Assets of Discontinued Operations | — | 14.9 | |||||
Total assets | $ | 1,851.0 | $ | 2,135.5 |
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(In Millions) | |||||||||||||||||||||||
June 30, 2016 | December 31, 2015 | ||||||||||||||||||||||
Segment | Finished Goods | Work-in Process | Total Inventory | Finished Goods | Work-in Process | Total Inventory | |||||||||||||||||
U.S. Iron Ore | $ | 309.9 | $ | 26.7 | $ | 336.6 | $ | 252.3 | $ | 11.7 | $ | 264.0 | |||||||||||
Asia Pacific Iron Ore | 13.6 | 41.0 | 54.6 | 20.8 | 44.8 | 65.6 | |||||||||||||||||
Total | $ | 323.5 | $ | 67.7 | $ | 391.2 | $ | 273.1 | $ | 56.5 | $ | 329.6 |
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(In Millions) | |||||||
June 30, 2016 | December 31, 2015 | ||||||
Land rights and mineral rights | $ | 500.5 | $ | 500.5 | |||
Office and information technology | 64.2 | 71.0 | |||||
Buildings | 60.5 | 60.4 | |||||
Mining equipment | 596.8 | 594.0 | |||||
Processing equipment | 519.3 | 516.8 | |||||
Electric power facilities | 49.4 | 46.4 | |||||
Land improvements | 24.8 | 24.8 | |||||
Asset retirement obligation | 67.1 | 87.9 | |||||
Other | 28.0 | 28.2 | |||||
Construction in-progress | 43.3 | 40.3 | |||||
1,953.9 | 1,970.3 | ||||||
Allowance for depreciation and depletion | (960.8 | ) | (911.3 | ) | |||
$ | 993.1 | $ | 1,059.0 |
|
($ in Millions) | |||||||||||||||||||
June 30, 2016 | |||||||||||||||||||
Debt Instrument | Annual Effective Interest Rate | Total Principal Amount | Debt Issuance Costs | Undiscounted Interest/(Unamortized Discounts) | Total Debt | ||||||||||||||
$700 Million 4.875% 2021 Senior Notes | 4.89% | $ | 336.2 | $ | (1.3 | ) | $ | (0.2 | ) | $ | 334.7 | (1) | |||||||
$1.3 Billion Senior Notes: | |||||||||||||||||||
$500 Million 4.80% 2020 Senior Notes | 4.83% | 249.3 | (0.8 | ) | (0.2 | ) | 248.3 | (2) | |||||||||||
$800 Million 6.25% 2040 Senior Notes | 6.34% | 298.4 | (2.5 | ) | (3.5 | ) | 292.4 | (3) | |||||||||||
$400 Million 5.90% 2020 Senior Notes | 5.98% | 225.6 | (0.7 | ) | (0.6 | ) | 224.3 | (4) | |||||||||||
$500 Million 3.95% 2018 Senior Notes | 6.15% | 283.6 | (0.6 | ) | (0.8 | ) | 282.2 | (5) | |||||||||||
$540 Million 8.25% 2020 First Lien Notes | 9.97% | 540.0 | (9.2 | ) | (29.0 | ) | 501.8 | ||||||||||||
$218.5 Million 8.00% 2020 1.5 Lien Notes | N/A | 218.5 | — | 74.3 | 292.8 | (6) | |||||||||||||
$544.2 Million 7.75% 2020 Second Lien Notes | 15.55% | 430.1 | (6.6 | ) | (94.9 | ) | 328.6 | (7) | |||||||||||
$550 Million ABL Facility: | |||||||||||||||||||
ABL Facility | N/A | 550.0 | N/A | N/A | — | (8) | |||||||||||||
Fair Value Adjustment to Interest Rate Hedge | 2.1 | ||||||||||||||||||
Total debt | $ | 3,131.7 | $ | 2,507.2 | |||||||||||||||
Less: Current portion | 17.5 | ||||||||||||||||||
Long-term debt | $ | 2,489.7 |
($ in Millions) | |||||||||||||||||||
December 31, 2015 | |||||||||||||||||||
Debt Instrument | Annual Effective Interest Rate | Total Principal Amount | Debt Issuance Costs | Unamortized Discounts | Total Debt | ||||||||||||||
$700 Million 4.875% 2021 Senior Notes | 4.89% | $ | 412.5 | $ | (1.7 | ) | $ | (0.2 | ) | $ | 410.6 | ||||||||
$1.3 Billion Senior Notes: | |||||||||||||||||||
$500 Million 4.80% 2020 Senior Notes | 4.83% | 306.7 | (1.1 | ) | (0.4 | ) | 305.2 | ||||||||||||
$800 Million 6.25% 2040 Senior Notes | 6.34% | 492.8 | (4.3 | ) | (5.8 | ) | 482.7 | ||||||||||||
$400 Million 5.90% 2020 Senior Notes | 5.98% | 290.8 | (1.1 | ) | (0.8 | ) | 288.9 | ||||||||||||
$500 Million 3.95% 2018 Senior Notes | 6.30% | 311.2 | (0.9 | ) | (1.2 | ) | 309.1 | ||||||||||||
$540 Million 8.25% 2020 First Lien Notes | 9.97% | 540.0 | (10.5 | ) | (32.1 | ) | 497.4 | ||||||||||||
$544.2 Million 7.75% 2020 Second Lien Notes | 15.55% | 544.2 | (9.5 | ) | (131.5 | ) | 403.2 | ||||||||||||
$550 Million ABL Facility: | |||||||||||||||||||
ABL Facility | N/A | 550.0 | N/A | N/A | — | (9) | |||||||||||||
Fair Value Adjustment to Interest Rate Hedge | 2.3 | ||||||||||||||||||
Total debt | $ | 3,448.2 | $ | 2,699.4 |
(1) | On March 2, 2016, we exchanged as part of an exchange offer $76.3 million of the 4.875 percent senior notes for $30.5 million of the 8.00 percent 1.5 lien notes that are recorded at a carrying value of $40.9 million, including undiscounted interest payments as of June 30, 2016. |
(2) | On March 2, 2016, we exchanged as part of an exchange offer $44.7 million of the 4.80 percent senior notes for $17.9 million of the 8.00 percent 1.5 lien notes that are recorded at a carrying value of $23.9 million, including undiscounted interest payments as of June 30, 2016. Additionally, during the second quarter of 2016 we entered into a debt for equity exchange; see NOTE 15 - CAPITAL STOCK for further discussion of this transaction. |
(3) | On March 2, 2016, we exchanged as part of an exchange offer $194.4 million of the 6.25 percent senior notes for $75.8 million of the 8.00 percent 1.5 lien notes that are recorded at a carrying value of $101.5 million, including undiscounted interest payments as of June 30, 2016. |
(4) | On March 2, 2016, we exchanged as part of an exchange offer $65.1 million of the 5.90 percent senior notes for $26.0 million of the 8.00 percent 1.5 lien notes that are recorded at a carrying value of $34.9 million, including undiscounted interest payments as of June 30, 2016. |
(5) | On March 2, 2016, we exchanged as part of an exchange offer $17.6 million of the 3.95 percent senior notes for $11.4 million of the 8.00 percent 1.5 lien notes that are recorded at a carrying value of $15.3 million, including undiscounted interest payments as of June 30, 2016. Additionally, during the first quarter of 2016 we entered into a debt for equity exchange; see NOTE 15 - CAPITAL STOCK for further discussion of this transaction. |
(6) | See the section entitled "$218.5 million 8.00 percent 2020 Senior Secured 1.5 Lien Notes - 2016 Exchange Offers" below for further discussion related to this instrument. As of June 30, 2016, $17.5 million of the undiscounted interest is recorded as current and classified as Other current liabilities in the Statements of Unaudited Condensed Consolidated Financial Position. |
(7) | On March 2, 2016, we exchanged as part of an exchange offer $114.1 million of the 7.75 percent senior notes for $57.0 million of the 8.00 percent 1.5 lien notes that are recorded at a carrying value of $76.3 million, including undiscounted interest payments as of June 30, 2016. |
(8) | As of June 30, 2016, no loans were drawn under the ABL Facility and we had total availability of $425.6 million as a result of borrowing base limitations. As of June 30, 2016, the principal amount of letter of credit obligations totaled $112.8 million, thereby further reducing available borrowing capacity on our ABL Facility to $312.8 million. |
(9) | As of December 31, 2015, no loans were drawn under the ABL Facility and we had total availability of $366.0 million as a result of borrowing base limitations. As of December 31, 2015, the principal amount of letter of credit obligations totaled $186.3 million and commodity hedge obligations totaled $0.5 million, thereby further reducing available borrowing capacity on our ABL Facility to $179.2 million. |
(In Millions) | |||
Maturities of Debt | |||
2016 (July 1 - December 31) | $ | — | |
2017 | — | ||
2018 | 283.6 | ||
2019 | — | ||
2020 | 1,663.5 | ||
2021 | 336.2 | ||
2022 and thereafter | 298.4 | ||
Total maturities of debt | $ | 2,581.7 |
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Qualitative/Quantitative Information About Level 3 Fair Value Measurements | ||||||||||||
(In Millions) Fair Value at June 30, 2016 | Balance Sheet Location | Valuation Technique | Unobservable Input | Range or Point Estimate per dry metric ton (Weighted Average) | ||||||||
Provisional Pricing Arrangements | $ | 2.1 | Other current assets | Market Approach | Management's Estimate of 62% Fe | $55 | ||||||
$ | 2.6 | Other current liabilities | ||||||||||
Customer Supply Agreement | $ | 23.7 | Other current assets | Market Approach | Hot-Rolled Steel Estimate | $430 - $530 ($480) |
(In Millions) | |||||||||||||||
Derivative Assets (Level 3) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Beginning balance | $ | 9.0 | $ | 34.5 | $ | 7.8 | $ | 63.2 | |||||||
Total gains (losses) | |||||||||||||||
Included in earnings | 34.5 | 0.6 | 45.7 | 10.7 | |||||||||||
Settlements | (17.7 | ) | (27.4 | ) | (27.7 | ) | (66.2 | ) | |||||||
Transfers into Level 3 | — | — | — | — | |||||||||||
Transfers out of Level 3 | — | — | — | — | |||||||||||
Ending balance - June 30 | $ | 25.8 | $ | 7.7 | $ | 25.8 | $ | 7.7 | |||||||
Total gains for the period included in earnings attributable to the change in unrealized gains on assets still held at the reporting date | $ | 21.6 | $ | 0.6 | $ | 21.9 | $ | 10.7 |
(In Millions) | |||||||||||||||
Derivative Liabilities (Level 3) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Beginning balance | $ | (6.2 | ) | $ | (16.2 | ) | $ | (3.4 | ) | $ | (9.5 | ) | |||
Total gains (losses) | |||||||||||||||
Included in earnings | (2.8 | ) | 1.1 | (8.4 | ) | (17.3 | ) | ||||||||
Settlements | 6.4 | 7.1 | 9.2 | 18.8 | |||||||||||
Transfers into Level 3 | — | — | — | — | |||||||||||
Transfers out of Level 3 | — | — | — | — | |||||||||||
Ending balance - June 30 | $ | (2.6 | ) | $ | (8.0 | ) | $ | (2.6 | ) | $ | (8.0 | ) | |||
Total losses for the period included in earnings attributable to the change in unrealized losses on liabilities still held at the reporting date | $ | (0.7 | ) | $ | (5.8 | ) | $ | (2.6 | ) | $ | (8.0 | ) |
(In Millions) | |||||||||||||||||
June 30, 2016 | December 31, 2015 | ||||||||||||||||
Classification | Carrying Value | Fair Value | Carrying Value | Fair Value | |||||||||||||
Long-term debt: | |||||||||||||||||
Senior Notes—$700 million | Level 1 | $ | 334.7 | $ | 223.6 | $ | 410.6 | $ | 69.4 | ||||||||
Senior Notes—$1.3 billion | Level 1 | 540.7 | 349.6 | 787.9 | 137.4 | ||||||||||||
Senior Notes—$400 million | Level 1 | 224.3 | 167.0 | 288.9 | 52.8 | ||||||||||||
Senior Notes—$500 million | Level 1 | 282.2 | 268.0 | 309.1 | 87.1 | ||||||||||||
Senior First Lien Notes —$540 million | Level 1 | 501.8 | 548.1 | 497.4 | 414.5 | ||||||||||||
Senior 1.5 Lien Notes —$218.5 million | Level 2 | 292.8 | 197.0 | — | — | ||||||||||||
Senior Second Lien Notes —$544.2 million | Level 1 | 328.6 | 352.7 | 403.2 | 134.7 | ||||||||||||
ABL Facility | Level 2 | — | — | — | — | ||||||||||||
Fair value adjustment to interest rate hedge | Level 2 | 2.1 | 2.1 | 2.3 | 2.3 | ||||||||||||
Total long-term debt | $ | 2,507.2 | $ | 2,108.1 | $ | 2,699.4 | $ | 898.2 |
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(In Millions) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Service cost | $ | 4.5 | $ | 6.3 | $ | 9.0 | $ | 12.6 | |||||||
Interest cost | 7.5 | 9.5 | 14.9 | 18.9 | |||||||||||
Expected return on plan assets | (13.7 | ) | (15.0 | ) | (27.4 | ) | (29.9 | ) | |||||||
Amortization: | |||||||||||||||
Prior service costs | 0.5 | 0.6 | 1.1 | 1.2 | |||||||||||
Net actuarial loss | 5.3 | 5.4 | 10.5 | 10.8 | |||||||||||
Curtailments/settlements | — | $ | — | — | 0.3 | ||||||||||
Net periodic benefit cost to continuing operations | $ | 4.1 | $ | 6.8 | $ | 8.1 | $ | 13.9 |
(In Millions) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Service cost | $ | 0.4 | $ | 1.5 | $ | 0.9 | $ | 3.0 | |||||||
Interest cost | 2.3 | 3.2 | 4.5 | 6.5 | |||||||||||
Expected return on plan assets | (4.3 | ) | (4.6 | ) | (8.5 | ) | (9.2 | ) | |||||||
Amortization: | |||||||||||||||
Prior service credits | (0.9 | ) | (0.9 | ) | (1.8 | ) | (1.8 | ) | |||||||
Net actuarial loss | 1.4 | — | 2.8 | 3.1 | |||||||||||
Net periodic benefit cost to continuing operations | $ | (1.1 | ) | $ | (0.8 | ) | $ | (2.1 | ) | $ | 1.6 |
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(In Millions) | |||||||
Capital Leases | Operating Leases | ||||||
2016 (July 1 - December 31) | $ | 12.4 | $ | 4.6 | |||
2017 | 22.8 | 8.9 | |||||
2018 | 18.4 | 7.5 | |||||
2019 | 10.2 | 4.9 | |||||
2020 | 9.2 | 4.9 | |||||
2021 and thereafter | 9.3 | 5.0 | |||||
Total minimum lease payments | $ | 82.3 | $ | 35.8 | |||
Amounts representing interest | 15.4 | ||||||
Present value of net minimum lease payments | $ | 66.9 | (1) |
(1) | The total is comprised of $18.2 million and $48.7 million classified as Other current liabilities and Other liabilities, respectively, in the Statements of Unaudited Condensed Consolidated Financial Position at June 30, 2016. |
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(In Millions) | |||||||
June 30, 2016 | December 31, 2015 | ||||||
Environmental | $ | 3.5 | $ | 3.6 | |||
Mine closure | |||||||
LTVSMC | 24.8 | 24.1 | |||||
Operating mines: | |||||||
U.S. Iron Ore | 174.5 | 189.9 | |||||
Asia Pacific Iron Ore | 17.2 | 16.4 | |||||
Total mine closure | 216.5 | 230.4 | |||||
Total environmental and mine closure obligations | 220.0 | 234.0 | |||||
Less current portion | 2.6 | 2.8 | |||||
Long term environmental and mine closure obligations | $ | 217.4 | $ | 231.2 |
(In Millions) | |||||||
June 30, 2016 | December 31, 2015 | ||||||
Asset retirement obligation at beginning of period | $ | 206.3 | $ | 142.4 | |||
Accretion expense | 5.8 | 6.5 | |||||
Exchange rate changes | 0.4 | (1.1 | ) | ||||
Revision in estimated cash flows | (20.8 | ) | 58.5 | ||||
Asset retirement obligation at end of period | $ | 191.7 | $ | 206.3 |
|
(In Millions) | |||||||||||||||||||||||||
June 30, 2016 | December 31, 2015 | ||||||||||||||||||||||||
Classification | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | |||||||||||||||||||
Definite-lived intangible assets: | |||||||||||||||||||||||||
Permits | Other non-current assets | $ | 78.6 | $ | (22.8 | ) | $ | 55.8 | $ | 78.4 | $ | (20.2 | ) | $ | 58.2 | ||||||||||
Total intangible assets | $ | 78.6 | $ | (22.8 | ) | $ | 55.8 | $ | 78.4 | $ | (20.2 | ) | $ | 58.2 | |||||||||||
Below-market sales contracts | Other current liabilities | $ | (23.1 | ) | $ | 7.7 | $ | (15.4 | ) | $ | (23.1 | ) | $ | — | $ | (23.1 | ) | ||||||||
Below-market sales contracts | Other liabilities | (205.8 | ) | 205.8 | — | (205.8 | ) | 205.8 | — | ||||||||||||||||
Total below-market sales contracts | $ | (228.9 | ) | $ | 213.5 | $ | (15.4 | ) | $ | (228.9 | ) | $ | 205.8 | $ | (23.1 | ) |
(In Millions) | |||
Amount | |||
Year Ending December 31, | |||
2016 (remaining six months) | $ | 1.8 | |
2017 | 4.2 | ||
2018 | 4.2 | ||
2019 | 2.5 | ||
2020 | 2.5 | ||
2021 | 2.5 | ||
Total | $ | 17.7 |
|
(In Millions) | |||||||||||||||||||||||
Derivative Assets | Derivative Liabilities | ||||||||||||||||||||||
June 30, 2016 | December 31, 2015 | June 30, 2016 | December 31, 2015 | ||||||||||||||||||||
Derivative Instrument | Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | |||||||||||||||
Customer Supply Agreement | Other current assets | 23.7 | Other current assets | 5.8 | — | — | |||||||||||||||||
Provisional Pricing Arrangements | Other current assets | 2.1 | Other current assets | 2.0 | Other current liabilities | 2.6 | Other current liabilities | 3.4 | |||||||||||||||
Commodity Contracts | — | — | — | Other current liabilities | 0.6 | ||||||||||||||||||
Total derivatives not designated as hedging instruments under ASC 815 | $ | 25.8 | $ | 7.8 | $ | 2.6 | $ | 4.0 |
(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, | |||||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||||
Customer Supply Agreement | Product revenues | 19.5 | 0.4 | 19.9 | 10.5 | |||||||||||
Provisional Pricing Arrangements | Product revenues | 1.8 | 8.4 | 0.3 | (7.8 | ) | ||||||||||
Foreign Exchange Contracts | Other non-operating income (expense) | — | (3.4 | ) | — | 2.5 | ||||||||||
Commodity Contracts | Cost of goods sold and operating expenses | — | 0.2 | — | (3.4 | ) | ||||||||||
Foreign Exchange Contracts | Product revenues | — | (9.7 | ) | — | (9.7 | ) | |||||||||
$ | 21.3 | $ | (4.1 | ) | $ | 20.2 | $ | (7.9 | ) |
|
(In Millions) | ||||||||||||||||||
Canadian Operations | ||||||||||||||||||
North American Coal | Eastern Canadian Iron Ore | Other | Total Canadian Operations | Total of Discontinued Operations | ||||||||||||||
Statements of Unaudited Condensed Consolidated Operations | ||||||||||||||||||
Income (Loss) from Discontinued Operations, net of tax | QTD June 30, 2016 | $ | (0.7 | ) | $ | 0.3 | $ | — | $ | 0.3 | $ | (0.4 | ) | |||||
Income (Loss) from Discontinued Operations, net of tax | QTD June 30, 2015 | $ | (31.5 | ) | $ | 134.9 | $ | — | $ | 134.9 | $ | 103.4 | ||||||
Income (Loss) from Discontinued Operations, net of tax | YTD June 30, 2016 | $ | (2.0 | ) | $ | 4.1 | $ | — | $ | 4.1 | $ | 2.1 | ||||||
Income (Loss) from Discontinued Operations, net of tax | YTD June 30, 2015 | $ | (107.2 | ) | $ | (717.8 | ) | $ | (0.1 | ) | $ | (717.9 | ) | $ | (825.1 | ) | ||
Statements of Unaudited Condensed Consolidated Financial Position | ||||||||||||||||||
Short-term assets of discontinued operations | As of June 30, 2016 | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||
Short-term liabilities of discontinued operations | As of June 30, 2016 | $ | 4.4 | $ | — | $ | — | $ | — | $ | 4.4 | |||||||
Short-term assets of discontinued operations | As of December 31, 2015 | $ | 14.9 | $ | — | $ | — | $ | — | $ | 14.9 | |||||||
Short-term liabilities of discontinued operations | As of December 31, 2015 | $ | 6.9 | $ | — | $ | — | $ | — | $ | 6.9 | |||||||
Non-Cash Operating and Investing Activities | ||||||||||||||||||
Depreciation, depletion and amortization: | YTD June 30, 2015 | $ | 3.2 | $ | — | $ | — | $ | — | $ | 3.2 | |||||||
Purchase of property, plant and equipment | YTD June 30, 2015 | $ | 5.5 | $ | — | $ | — | $ | — | $ | 5.5 | |||||||
Impairment of other long-lived assets | YTD June 30, 2015 | $ | 73.4 | $ | — | $ | — | $ | — | $ | 73.4 |
(In Millions) | ||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
Loss from Discontinued Operations | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Revenues from product sales and services | $ | — | $ | 142.7 | $ | — | $ | 259.3 | ||||||||
Cost of goods sold and operating expenses | — | (167.0 | ) | — | (274.3 | ) | ||||||||||
Sales margin | — | (24.3 | ) | — | (15.0 | ) | ||||||||||
Other operating expense | (0.8 | ) | (7.1 | ) | (2.0 | ) | (18.3 | ) | ||||||||
Other expense | — | (0.5 | ) | — | (1.0 | ) | ||||||||||
Loss from discontinued operations before income taxes | (0.8 | ) | (31.9 | ) | (2.0 | ) | (34.3 | ) | ||||||||
Impairment of long-lived assets | — | — | — | (73.4 | ) | |||||||||||
Income tax benefit (expense) | 0.1 | 0.4 | — | 0.5 | ||||||||||||
Loss from discontinued operations, net of tax | $ | (0.7 | ) | $ | (31.5 | ) | $ | (2.0 | ) | $ | (107.2 | ) |
(In Millions) | ||||||||
Assets and Liabilities of Discontinued Operations(1) | June 30, 2016 | December 31, 2015 | ||||||
Other current assets | $ | — | $ | 14.9 | ||||
Total assets of discontinued operations | $ | — | $ | 14.9 | ||||
Accrued liabilities | $ | 0.3 | $ | — | ||||
Other current liabilities(1) | 4.1 | 6.9 | ||||||
Total liabilities of discontinued operations | $ | 4.4 | $ | 6.9 | ||||
(1) At June 30, 2016 and December 31, 2015, we had $5.8 million and $7.8 million, respectively, of contingent liabilities associated with our exit from the coal business recorded on our parent company. |
(In Millions) | ||||||||||||||||
Three Months Ended June 30, | Six Months Ended June, | |||||||||||||||
Gain (Loss) from Discontinued Operations | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Revenues from product sales and services | $ | — | $ | — | $ | — | $ | 11.3 | ||||||||
Cost of goods sold and operating expenses | — | — | — | (11.1 | ) | |||||||||||
Sales margin | — | — | — | 0.2 | ||||||||||||
Other operating expense | — | (0.5 | ) | — | (33.8 | ) | ||||||||||
Other expense | — | — | — | (1.0 | ) | |||||||||||
Loss from discontinued operations before income taxes | — | (0.5 | ) | — | (34.6 | ) | ||||||||||
Gain (loss) from deconsolidation | 0.3 | 134.7 | 4.1 | (684.0 | ) | |||||||||||
Income tax benefit (expense) | — | 0.7 | — | 0.7 | ||||||||||||
Gain (loss) from discontinued operations, net of tax | $ | 0.3 | $ | 134.9 | $ | 4.1 | $ | (717.9 | ) |
(In Millions) | ||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||||
Investment impairment on deconsolidation1 | $ | 0.3 | $ | (4.4 | ) | $ | 4.1 | $ | (480.4 | ) | ||||||
Contingent liabilities | — | 139.1 | — | (203.6 | ) | |||||||||||
Total gain (loss) from deconsolidation | $ | 0.3 | $ | 134.7 | $ | 4.1 | $ | (684.0 | ) | |||||||
1 Includes the adjustment to fair value of our remaining interest in the Canadian Entities. |
(In Millions) | ||||||||||||||||||||
June 30, 2016 | ||||||||||||||||||||
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 Gains | |||||||||||||||
Assets: | ||||||||||||||||||||
Loans to and accounts receivables from the Canadian Entities | $ | — | $ | — | $ | 70.2 | $ | 70.2 | $ | 4.1 | ||||||||||
Liabilities: | ||||||||||||||||||||
Contingent liabilities | $ | — | $ | — | $ | 38.7 | $ | 38.7 | $ | — |
|
|
(In Millions) | |||||||||||
Cliffs Shareholders’ Equity (Deficit) | Noncontrolling Interest (Deficit) | Total Equity (Deficit) | |||||||||
December 31, 2015 | $ | (1,981.4 | ) | $ | 169.8 | $ | (1,811.6 | ) | |||
Comprehensive income | |||||||||||
Net income | 120.8 | 25.5 | 146.3 | ||||||||
Other comprehensive income | 9.0 | 1.3 | 10.3 | ||||||||
Total comprehensive income | 129.8 | 26.8 | 156.6 | ||||||||
Issuance of common shares | 14.4 | — | 14.4 | ||||||||
Stock and other incentive plans | 6.5 | — | 6.5 | ||||||||
Distributions of partnership equity | — | (41.4 | ) | (41.4 | ) | ||||||
Undistributed losses to noncontrolling interest | — | (3.4 | ) | (3.4 | ) | ||||||
June 30, 2016 | $ | (1,830.7 | ) | $ | 151.8 | $ | (1,678.9 | ) |
(In Millions) | |||||||||||
Cliffs Shareholders’ Equity (Deficit) | Noncontrolling Interest (Deficit) | Total Equity (Deficit) | |||||||||
December 31, 2014 | $ | (1,431.3 | ) | $ | (303.0 | ) | $ | (1,734.3 | ) | ||
Comprehensive income (loss) | |||||||||||
Net loss | (699.6 | ) | 3.1 | (696.5 | ) | ||||||
Other comprehensive income (loss) | 216.9 | (10.0 | ) | 206.9 | |||||||
Total comprehensive loss | (482.7 | ) | (6.9 | ) | (489.6 | ) | |||||
Effect of deconsolidation | — | 528.2 | 528.2 | ||||||||
Stock and other incentive plans | 3.0 | — | 3.0 | ||||||||
Preferred share dividends | (12.8 | ) | — | (12.8 | ) | ||||||
Distributions to noncontrolling interest | — | (34.7 | ) | (34.7 | ) | ||||||
June 30, 2015 | $ | (1,923.8 | ) | $ | 183.6 | $ | (1,740.2 | ) |
(In Millions) | |||||||||||||||||||
Changes in Pension and Other Post-Retirement Benefits, 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, 2015 | $ | (241.4 | ) | $ | 0.1 | $ | 220.7 | $ | 2.6 | $ | (18.0 | ) | |||||||
Other comprehensive income (loss) before reclassifications | (1.5 | ) | (0.1 | ) | 4.4 | (3.4 | ) | (0.6 | ) | ||||||||||
Net loss reclassified from accumulated other comprehensive income (loss) | 6.3 | — | — | — | 6.3 | ||||||||||||||
Balance March 31, 2016 | $ | (236.6 | ) | $ | — | $ | 225.1 | $ | (0.8 | ) | $ | (12.3 | ) | ||||||
Other comprehensive income before reclassifications | (0.4 | ) | — | (2.7 | ) | 0.1 | (3.0 | ) | |||||||||||
Net loss (gain) reclassified from accumulated other comprehensive income (loss) | 6.3 | — | — | — | 6.3 | ||||||||||||||
Balance June 30, 2016 | $ | (230.7 | ) | $ | — | $ | 222.4 | $ | (0.7 | ) | $ | (9.0 | ) |
(In Millions) | |||||||||||||||||||
Changes in Pension and Other Post-Retirement Benefits, 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, 2014 | $ | (291.1 | ) | $ | (1.0 | ) | $ | 64.4 | $ | (18.1 | ) | $ | (245.8 | ) | |||||
Other comprehensive income (loss) before reclassifications | 9.3 | 2.8 | (14.7 | ) | (7.1 | ) | (9.7 | ) | |||||||||||
Net loss (gain) reclassified from accumulated other comprehensive income (loss) | 30.3 | (2.0 | ) | 182.7 | 6.3 | 217.3 | |||||||||||||
Balance March 31, 2015 | $ | (251.5 | ) | $ | (0.2 | ) | $ | 232.4 | $ | (18.9 | ) | $ | (38.2 | ) | |||||
Other comprehensive income (loss) before reclassifications | 1.3 | 1.0 | 1.2 | 0.5 | 4.0 | ||||||||||||||
Net loss (gain) reclassified from accumulated other comprehensive income (loss) | (1.6 | ) | (0.9 | ) | — | 7.8 | 5.3 | ||||||||||||
Balance June 30, 2015 | $ | (251.8 | ) | $ | (0.1 | ) | $ | 233.6 | $ | (10.6 | ) | $ | (28.9 | ) |
(In Millions) | ||||||||||||||||||
Details about Accumulated Other Comprehensive Income (Loss) Components | Amount of (Gain)/Loss Reclassified into Income | Affected Line Item in the Statement of Unaudited Condensed Consolidated Operations | ||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||||||
Amortization of pension and postretirement benefit liability: | ||||||||||||||||||
Prior service costs (1) | $ | (0.4 | ) | $ | (0.3 | ) | $ | (0.7 | ) | $ | (0.6 | ) | ||||||
Net actuarial loss (1) | 6.7 | 5.4 | 13.3 | 13.9 | ||||||||||||||
Settlements/curtailments (1) | — | — | — | 0.3 | ||||||||||||||
Effect of deconsolidation (2) | — | (6.7 | ) | — | 15.1 | Income (Loss) from Discontinued Operations, net of tax | ||||||||||||
6.3 | (1.6 | ) | 12.6 | 28.7 | Total before taxes | |||||||||||||
— | — | — | — | Income tax benefit (expense) | ||||||||||||||
$ | 6.3 | $ | (1.6 | ) | $ | 12.6 | $ | 28.7 | Net of taxes | |||||||||
Unrealized gain (loss) on marketable securities: | ||||||||||||||||||
Impairment | — | (1.2 | ) | — | (3.2 | ) | Other non-operating income (expense) | |||||||||||
— | 0.3 | — | 0.3 | Income tax benefit (expense) | ||||||||||||||
$ | — | $ | (0.9 | ) | $ | — | $ | (2.9 | ) | Net of taxes | ||||||||
Unrealized gain (loss) on foreign currency translation: | ||||||||||||||||||
Effect of deconsolidation (2) | $ | — | $ | — | $ | — | $ | 182.7 | Income (Loss) from Discontinued Operations, net of tax | |||||||||
— | — | — | — | Income tax benefit (expense) | ||||||||||||||
$ | — | $ | — | $ | — | $ | 182.7 | Net of taxes | ||||||||||
Unrealized gain (loss) on derivative financial instruments: | ||||||||||||||||||
Australian dollar foreign exchange contracts | $ | — | $ | 11.1 | $ | — | $ | 20.1 | Product revenues | |||||||||
— | (3.3 | ) | — | (6.0 | ) | Income tax benefit (expense) | ||||||||||||
$ | — | $ | 7.8 | $ | — | $ | 14.1 | Net of taxes | ||||||||||
Total Reclassifications for the Period | $ | 6.3 | $ | 5.3 | $ | 12.6 | $ | 222.6 |
(1) | These accumulated other comprehensive income components are included in the computation of net periodic benefit cost. See NOTE 7 - PENSIONS AND OTHER POSTRETIREMENT BENEFITS for further information. |
(2) | Represents Canadian accumulated currency translation adjustments that were deconsolidated. See NOTE 14 - DISCONTINUED OPERATIONS for further information. |
|
(In Millions) | |||||||
Six Months Ended June 30, | |||||||
2016 | 2015 | ||||||
Capital additions (1) | $ | 18.1 | $ | 46.8 | |||
Cash paid for capital expenditures | 20.2 | 34.4 | |||||
Difference (Non-cash accruals) | $ | (2.1 | ) | $ | 12.4 |
(1) | Includes capital additions of $18.1 million related to continuing operations for the six months ended June 30, 2016. Includes capital additions of $28.9 million and $17.9 million related to continuing operations and discontinued operations, respectively, for the six months ended June 30, 2015. |
|
Mine | Cliffs Natural Resources | ArcelorMittal | U.S. Steel Corporation | ||||||
Empire | 79.0 | % | 21.0 | % | — | ||||
Tilden | 85.0 | % | — | 15.0 | % | ||||
Hibbing | 23.0 | % | 62.3 | % | 14.7 | % |
(In Millions) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Product revenues from related parties | $ | 241.6 | $ | 149.6 | $ | 345.0 | $ | 260.0 | |||||||
Total product revenues | 452.8 | 454.3 | 728.4 | 857.4 | |||||||||||
Related party product revenue as a percent of total product revenue | 53.4 | % | 32.9 | % | 47.4 | % | 30.3 | % |
|
(In Millions, Except Per Share Amounts) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Income (Loss) from Continuing Operations | $ | 29.9 | $ | (38.2 | ) | $ | 144.2 | $ | 128.6 | ||||||
Income from Continuing Operations Attributable to Noncontrolling Interest | (16.7 | ) | (5.0 | ) | (25.5 | ) | (3.1 | ) | |||||||
Net Income (Loss) from Continuing Operations Attributable to Cliffs Shareholders | $ | 13.2 | $ | (43.2 | ) | $ | 118.7 | $ | 125.5 | ||||||
Income (Loss) from Discontinued Operations, net of tax | (0.4 | ) | 103.4 | 2.1 | (825.1 | ) | |||||||||
Net Income (Loss) Attributable to Cliffs Shareholders | $ | 12.8 | $ | 60.2 | $ | 120.8 | $ | (699.6 | ) | ||||||
Preferred Stock Dividends | — | — | — | (12.8 | ) | ||||||||||
Net Income (Loss) Attributable to Cliffs Common Shareholders | $ | 12.8 | $ | 60.2 | $ | 120.8 | $ | (712.4 | ) | ||||||
Weighted Average Number of Shares: | |||||||||||||||
Basic | 182.3 | 153.2 | 177.0 | 153.2 | |||||||||||
Depositary Shares | — | — | — | 25.2 | |||||||||||
Employee Stock Plans | 2.3 | — | 1.3 | 0.3 | |||||||||||
Diluted | 184.6 | 153.2 | 178.3 | 178.7 | |||||||||||
Earnings (Loss) per Common Share Attributable to Cliffs Common Shareholders - Basic: | |||||||||||||||
Continuing operations | $ | 0.07 | $ | (0.28 | ) | $ | 0.67 | $ | 0.74 | ||||||
Discontinued operations | — | 0.67 | 0.01 | (5.39 | ) | ||||||||||
$ | 0.07 | $ | 0.39 | $ | 0.68 | $ | (4.65 | ) | |||||||
Earnings (Loss) per Common Share Attributable to Cliffs Common Shareholders - Diluted: | |||||||||||||||
Continuing operations | $ | 0.07 | $ | (0.28 | ) | $ | 0.67 | $ | 0.70 | ||||||
Discontinued operations | — | 0.67 | 0.01 | (4.62 | ) | ||||||||||
$ | 0.07 | $ | 0.39 | $ | 0.68 | $ | (3.92 | ) |
|
|
|
Name | Location | Ownership Interest | Operation | Status of Operations | ||||
Northshore | Minnesota | 100.0% | Iron Ore | Active | ||||
United Taconite | Minnesota | 100.0% | Iron Ore | Active | ||||
Tilden | Michigan | 85.0% | Iron Ore | Active | ||||
Empire | Michigan | 79.0% | Iron Ore | Active | ||||
Koolyanobbing | Western Australia | 100.0% | Iron Ore | Active |
|
Name | Location | Ownership Interest | Operation | Status of Operations | ||||
Northshore | Minnesota | 100.0% | Iron Ore | Active | ||||
United Taconite | Minnesota | 100.0% | Iron Ore | Active | ||||
Tilden | Michigan | 85.0% | Iron Ore | Active | ||||
Empire | Michigan | 79.0% | Iron Ore | Active | ||||
Koolyanobbing | Western Australia | 100.0% | Iron Ore | Active |
|
(In Millions) | |||||||||||||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||||||||||||||
Revenues from product sales and services: | |||||||||||||||||||||||||||
U.S. Iron Ore | $ | 361.7 | 73 | % | $ | 369.7 | 74 | % | $ | 547.2 | 68 | % | $ | 681.5 | 72 | % | |||||||||||
Asia Pacific Iron Ore | 134.5 | 27 | % | 128.4 | 26 | % | 254.5 | 32 | % | 262.6 | 28 | % | |||||||||||||||
Total revenues from product sales and services | $ | 496.2 | 100 | % | $ | 498.1 | 100 | % | $ | 801.7 | 100 | % | $ | 944.1 | 100 | % | |||||||||||
Sales margin: | |||||||||||||||||||||||||||
U.S. Iron Ore | $ | 70.0 | $ | 49.0 | $ | 83.2 | $ | 129.0 | |||||||||||||||||||
Asia Pacific Iron Ore | 21.5 | 8.3 | 39.2 | 9.1 | |||||||||||||||||||||||
Sales margin | 91.5 | 57.3 | 122.4 | 138.1 | |||||||||||||||||||||||
Other operating expense | (16.8 | ) | (31.6 | ) | (48.0 | ) | (40.5 | ) | |||||||||||||||||||
Other income (expense) | (46.9 | ) | (65.7 | ) | 75.2 | 204.3 | |||||||||||||||||||||
Income (loss) from continuing operations before income taxes | $ | 27.8 | $ | (40.0 | ) | $ | 149.6 | $ | 301.9 |
(In Millions) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Net Income (Loss) | $ | 29.5 | $ | 65.2 | $ | 146.3 | $ | (696.5 | ) | ||||||
Less: | |||||||||||||||
Interest expense, net | (50.7 | ) | (64.3 | ) | (107.5 | ) | (108.5 | ) | |||||||
Income tax benefit (expense) | 2.1 | 2.9 | (5.4 | ) | (172.1 | ) | |||||||||
Depreciation, depletion and amortization | (26.9 | ) | (30.5 | ) | (62.1 | ) | (63.5 | ) | |||||||
EBITDA | $ | 105.0 | $ | 157.1 | $ | 321.3 | $ | (352.4 | ) | ||||||
Less: | |||||||||||||||
Impact of discontinued operations | (0.4 | ) | 103.0 | 2.1 | (821.1 | ) | |||||||||
Gain on extinguishment/restructuring of debt | 3.6 | — | 182.4 | 313.7 | |||||||||||
Severance and contractor termination costs | — | (10.0 | ) | (0.1 | ) | (11.6 | ) | ||||||||
Foreign exchange remeasurement | 0.2 | (0.8 | ) | (0.9 | ) | 12.7 | |||||||||
Adjusted EBITDA | $ | 101.6 | $ | 64.9 | $ | 137.8 | $ | 153.9 | |||||||
EBITDA: | |||||||||||||||
U.S. Iron Ore | $ | 94.1 | $ | 68.8 | $ | 135.5 | $ | 170.4 | |||||||
Asia Pacific Iron Ore | 26.1 | 9.6 | 48.4 | 27.6 | |||||||||||
Other | (15.2 | ) | 78.7 | 137.4 | (550.4 | ) | |||||||||
Total EBITDA | $ | 105.0 | $ | 157.1 | $ | 321.3 | $ | (352.4 | ) | ||||||
Adjusted EBITDA: | |||||||||||||||
U.S. Iron Ore | $ | 97.2 | $ | 77.2 | $ | 143.3 | $ | 182.3 | |||||||
Asia Pacific Iron Ore | 26.5 | 17.4 | 49.5 | 23.1 | |||||||||||
Other | (22.1 | ) | (29.7 | ) | (55.0 | ) | (51.5 | ) | |||||||
Total Adjusted EBITDA | $ | 101.6 | $ | 64.9 | $ | 137.8 | $ | 153.9 |
(In Millions) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Depreciation, depletion and amortization: | |||||||||||||||
U.S. Iron Ore | $ | 19.4 | $ | 22.0 | $ | 46.3 | $ | 43.7 | |||||||
Asia Pacific Iron Ore | 6.1 | 6.7 | 12.9 | 13.0 | |||||||||||
Other | 1.4 | 1.8 | 2.9 | 3.6 | |||||||||||
Total depreciation, depletion and amortization | $ | 26.9 | $ | 30.5 | $ | 62.1 | $ | 60.3 | |||||||
Capital additions1: | |||||||||||||||
U.S. Iron Ore | $ | 9.2 | $ | 11.3 | $ | 13.7 | $ | 20.8 | |||||||
Asia Pacific Iron Ore | — | 1.1 | — | 4.5 | |||||||||||
Other | 2.1 | 3.2 | 4.4 | 3.6 | |||||||||||
Total capital additions | $ | 11.3 | $ | 15.6 | $ | 18.1 | $ | 28.9 |
(In Millions) | |||||||
June 30, 2016 | December 31, 2015 | ||||||
Assets: | |||||||
U.S. Iron Ore | $ | 1,510.3 | $ | 1,476.4 | |||
Asia Pacific Iron Ore | 166.4 | 202.5 | |||||
Total segment assets | 1,676.7 | 1,678.9 | |||||
Corporate | 174.3 | 441.7 | |||||
Assets of Discontinued Operations | — | 14.9 | |||||
Total assets | $ | 1,851.0 | $ | 2,135.5 |
|
(In Millions) | |||||||||||||||||||||||
June 30, 2016 | December 31, 2015 | ||||||||||||||||||||||
Segment | Finished Goods | Work-in Process | Total Inventory | Finished Goods | Work-in Process | Total Inventory | |||||||||||||||||
U.S. Iron Ore | $ | 309.9 | $ | 26.7 | $ | 336.6 | $ | 252.3 | $ | 11.7 | $ | 264.0 | |||||||||||
Asia Pacific Iron Ore | 13.6 | 41.0 | 54.6 | 20.8 | 44.8 | 65.6 | |||||||||||||||||
Total | $ | 323.5 | $ | 67.7 | $ | 391.2 | $ | 273.1 | $ | 56.5 | $ | 329.6 |
|
(In Millions) | |||||||
June 30, 2016 | December 31, 2015 | ||||||
Land rights and mineral rights | $ | 500.5 | $ | 500.5 | |||
Office and information technology | 64.2 | 71.0 | |||||
Buildings | 60.5 | 60.4 | |||||
Mining equipment | 596.8 | 594.0 | |||||
Processing equipment | 519.3 | 516.8 | |||||
Electric power facilities | 49.4 | 46.4 | |||||
Land improvements | 24.8 | 24.8 | |||||
Asset retirement obligation | 67.1 | 87.9 | |||||
Other | 28.0 | 28.2 | |||||
Construction in-progress | 43.3 | 40.3 | |||||
1,953.9 | 1,970.3 | ||||||
Allowance for depreciation and depletion | (960.8 | ) | (911.3 | ) | |||
$ | 993.1 | $ | 1,059.0 |
|
($ in Millions) | |||||||||||||||||||
June 30, 2016 | |||||||||||||||||||
Debt Instrument | Annual Effective Interest Rate | Total Principal Amount | Debt Issuance Costs | Undiscounted Interest/(Unamortized Discounts) | Total Debt | ||||||||||||||
$700 Million 4.875% 2021 Senior Notes | 4.89% | $ | 336.2 | $ | (1.3 | ) | $ | (0.2 | ) | $ | 334.7 | (1) | |||||||
$1.3 Billion Senior Notes: | |||||||||||||||||||
$500 Million 4.80% 2020 Senior Notes | 4.83% | 249.3 | (0.8 | ) | (0.2 | ) | 248.3 | (2) | |||||||||||
$800 Million 6.25% 2040 Senior Notes | 6.34% | 298.4 | (2.5 | ) | (3.5 | ) | 292.4 | (3) | |||||||||||
$400 Million 5.90% 2020 Senior Notes | 5.98% | 225.6 | (0.7 | ) | (0.6 | ) | 224.3 | (4) | |||||||||||
$500 Million 3.95% 2018 Senior Notes | 6.15% | 283.6 | (0.6 | ) | (0.8 | ) | 282.2 | (5) | |||||||||||
$540 Million 8.25% 2020 First Lien Notes | 9.97% | 540.0 | (9.2 | ) | (29.0 | ) | 501.8 | ||||||||||||
$218.5 Million 8.00% 2020 1.5 Lien Notes | N/A | 218.5 | — | 74.3 | 292.8 | (6) | |||||||||||||
$544.2 Million 7.75% 2020 Second Lien Notes | 15.55% | 430.1 | (6.6 | ) | (94.9 | ) | 328.6 | (7) | |||||||||||
$550 Million ABL Facility: | |||||||||||||||||||
ABL Facility | N/A | 550.0 | N/A | N/A | — | (8) | |||||||||||||
Fair Value Adjustment to Interest Rate Hedge | 2.1 | ||||||||||||||||||
Total debt | $ | 3,131.7 | $ | 2,507.2 | |||||||||||||||
Less: Current portion | 17.5 | ||||||||||||||||||
Long-term debt | $ | 2,489.7 |
($ in Millions) | |||||||||||||||||||
December 31, 2015 | |||||||||||||||||||
Debt Instrument | Annual Effective Interest Rate | Total Principal Amount | Debt Issuance Costs | Unamortized Discounts | Total Debt | ||||||||||||||
$700 Million 4.875% 2021 Senior Notes | 4.89% | $ | 412.5 | $ | (1.7 | ) | $ | (0.2 | ) | $ | 410.6 | ||||||||
$1.3 Billion Senior Notes: | |||||||||||||||||||
$500 Million 4.80% 2020 Senior Notes | 4.83% | 306.7 | (1.1 | ) | (0.4 | ) | 305.2 | ||||||||||||
$800 Million 6.25% 2040 Senior Notes | 6.34% | 492.8 | (4.3 | ) | (5.8 | ) | 482.7 | ||||||||||||
$400 Million 5.90% 2020 Senior Notes | 5.98% | 290.8 | (1.1 | ) | (0.8 | ) | 288.9 | ||||||||||||
$500 Million 3.95% 2018 Senior Notes | 6.30% | 311.2 | (0.9 | ) | (1.2 | ) | 309.1 | ||||||||||||
$540 Million 8.25% 2020 First Lien Notes | 9.97% | 540.0 | (10.5 | ) | (32.1 | ) | 497.4 | ||||||||||||
$544.2 Million 7.75% 2020 Second Lien Notes | 15.55% | 544.2 | (9.5 | ) | (131.5 | ) | 403.2 | ||||||||||||
$550 Million ABL Facility: | |||||||||||||||||||
ABL Facility | N/A | 550.0 | N/A | N/A | — | (9) | |||||||||||||
Fair Value Adjustment to Interest Rate Hedge | 2.3 | ||||||||||||||||||
Total debt | $ | 3,448.2 | $ | 2,699.4 |
(1) | On March 2, 2016, we exchanged as part of an exchange offer $76.3 million of the 4.875 percent senior notes for $30.5 million of the 8.00 percent 1.5 lien notes that are recorded at a carrying value of $40.9 million, including undiscounted interest payments as of June 30, 2016. |
(2) | On March 2, 2016, we exchanged as part of an exchange offer $44.7 million of the 4.80 percent senior notes for $17.9 million of the 8.00 percent 1.5 lien notes that are recorded at a carrying value of $23.9 million, including undiscounted interest payments as of June 30, 2016. Additionally, during the second quarter of 2016 we entered into a debt for equity exchange; see NOTE 15 - CAPITAL STOCK for further discussion of this transaction. |
(3) | On March 2, 2016, we exchanged as part of an exchange offer $194.4 million of the 6.25 percent senior notes for $75.8 million of the 8.00 percent 1.5 lien notes that are recorded at a carrying value of $101.5 million, including undiscounted interest payments as of June 30, 2016. |
(4) | On March 2, 2016, we exchanged as part of an exchange offer $65.1 million of the 5.90 percent senior notes for $26.0 million of the 8.00 percent 1.5 lien notes that are recorded at a carrying value of $34.9 million, including undiscounted interest payments as of June 30, 2016. |
(5) | On March 2, 2016, we exchanged as part of an exchange offer $17.6 million of the 3.95 percent senior notes for $11.4 million of the 8.00 percent 1.5 lien notes that are recorded at a carrying value of $15.3 million, including undiscounted interest payments as of June 30, 2016. Additionally, during the first quarter of 2016 we entered into a debt for equity exchange; see NOTE 15 - CAPITAL STOCK for further discussion of this transaction. |
(6) | See the section entitled "$218.5 million 8.00 percent 2020 Senior Secured 1.5 Lien Notes - 2016 Exchange Offers" below for further discussion related to this instrument. As of June 30, 2016, $17.5 million of the undiscounted interest is recorded as current and classified as Other current liabilities in the Statements of Unaudited Condensed Consolidated Financial Position. |
(7) | On March 2, 2016, we exchanged as part of an exchange offer $114.1 million of the 7.75 percent senior notes for $57.0 million of the 8.00 percent 1.5 lien notes that are recorded at a carrying value of $76.3 million, including undiscounted interest payments as of June 30, 2016. |
(8) | As of June 30, 2016, no loans were drawn under the ABL Facility and we had total availability of $425.6 million as a result of borrowing base limitations. As of June 30, 2016, the principal amount of letter of credit obligations totaled $112.8 million, thereby further reducing available borrowing capacity on our ABL Facility to $312.8 million. |
(9) | As of December 31, 2015, no loans were drawn under the ABL Facility and we had total availability of $366.0 million as a result of borrowing base limitations. As of December 31, 2015, the principal amount of letter of credit obligations totaled $186.3 million and commodity hedge obligations totaled $0.5 million, thereby further reducing available borrowing capacity on our ABL Facility to $179.2 million. |
(In Millions) | |||
Maturities of Debt | |||
2016 (July 1 - December 31) | $ | — | |
2017 | — | ||
2018 | 283.6 | ||
2019 | — | ||
2020 | 1,663.5 | ||
2021 | 336.2 | ||
2022 and thereafter | 298.4 | ||
Total maturities of debt | $ | 2,581.7 |
|
Qualitative/Quantitative Information About Level 3 Fair Value Measurements | ||||||||||||
(In Millions) Fair Value at June 30, 2016 | Balance Sheet Location | Valuation Technique | Unobservable Input | Range or Point Estimate per dry metric ton (Weighted Average) | ||||||||
Provisional Pricing Arrangements | $ | 2.1 | Other current assets | Market Approach | Management's Estimate of 62% Fe | $55 | ||||||
$ | 2.6 | Other current liabilities | ||||||||||
Customer Supply Agreement | $ | 23.7 | Other current assets | Market Approach | Hot-Rolled Steel Estimate | $430 - $530 ($480) |
(In Millions) | |||||||||||||||
Derivative Assets (Level 3) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Beginning balance | $ | 9.0 | $ | 34.5 | $ | 7.8 | $ | 63.2 | |||||||
Total gains (losses) | |||||||||||||||
Included in earnings | 34.5 | 0.6 | 45.7 | 10.7 | |||||||||||
Settlements | (17.7 | ) | (27.4 | ) | (27.7 | ) | (66.2 | ) | |||||||
Transfers into Level 3 | — | — | — | — | |||||||||||
Transfers out of Level 3 | — | — | — | — | |||||||||||
Ending balance - June 30 | $ | 25.8 | $ | 7.7 | $ | 25.8 | $ | 7.7 | |||||||
Total gains for the period included in earnings attributable to the change in unrealized gains on assets still held at the reporting date | $ | 21.6 | $ | 0.6 | $ | 21.9 | $ | 10.7 |
(In Millions) | |||||||||||||||
Derivative Liabilities (Level 3) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Beginning balance | $ | (6.2 | ) | $ | (16.2 | ) | $ | (3.4 | ) | $ | (9.5 | ) | |||
Total gains (losses) | |||||||||||||||
Included in earnings | (2.8 | ) | 1.1 | (8.4 | ) | (17.3 | ) | ||||||||
Settlements | 6.4 | 7.1 | 9.2 | 18.8 | |||||||||||
Transfers into Level 3 | — | — | — | — | |||||||||||
Transfers out of Level 3 | — | — | — | — | |||||||||||
Ending balance - June 30 | $ | (2.6 | ) | $ | (8.0 | ) | $ | (2.6 | ) | $ | (8.0 | ) | |||
Total losses for the period included in earnings attributable to the change in unrealized losses on liabilities still held at the reporting date | $ | (0.7 | ) | $ | (5.8 | ) | $ | (2.6 | ) | $ | (8.0 | ) |
(In Millions) | |||||||||||||||||
June 30, 2016 | December 31, 2015 | ||||||||||||||||
Classification | Carrying Value | Fair Value | Carrying Value | Fair Value | |||||||||||||
Long-term debt: | |||||||||||||||||
Senior Notes—$700 million | Level 1 | $ | 334.7 | $ | 223.6 | $ | 410.6 | $ | 69.4 | ||||||||
Senior Notes—$1.3 billion | Level 1 | 540.7 | 349.6 | 787.9 | 137.4 | ||||||||||||
Senior Notes—$400 million | Level 1 | 224.3 | 167.0 | 288.9 | 52.8 | ||||||||||||
Senior Notes—$500 million | Level 1 | 282.2 | 268.0 | 309.1 | 87.1 | ||||||||||||
Senior First Lien Notes —$540 million | Level 1 | 501.8 | 548.1 | 497.4 | 414.5 | ||||||||||||
Senior 1.5 Lien Notes —$218.5 million | Level 2 | 292.8 | 197.0 | — | — | ||||||||||||
Senior Second Lien Notes —$544.2 million | Level 1 | 328.6 | 352.7 | 403.2 | 134.7 | ||||||||||||
ABL Facility | Level 2 | — | — | — | — | ||||||||||||
Fair value adjustment to interest rate hedge | Level 2 | 2.1 | 2.1 | 2.3 | 2.3 | ||||||||||||
Total long-term debt | $ | 2,507.2 | $ | 2,108.1 | $ | 2,699.4 | $ | 898.2 |
|
(In Millions) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Service cost | $ | 4.5 | $ | 6.3 | $ | 9.0 | $ | 12.6 | |||||||
Interest cost | 7.5 | 9.5 | 14.9 | 18.9 | |||||||||||
Expected return on plan assets | (13.7 | ) | (15.0 | ) | (27.4 | ) | (29.9 | ) | |||||||
Amortization: | |||||||||||||||
Prior service costs | 0.5 | 0.6 | 1.1 | 1.2 | |||||||||||
Net actuarial loss | 5.3 | 5.4 | 10.5 | 10.8 | |||||||||||
Curtailments/settlements | — | $ | — | — | 0.3 | ||||||||||
Net periodic benefit cost to continuing operations | $ | 4.1 | $ | 6.8 | $ | 8.1 | $ | 13.9 |
(In Millions) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Service cost | $ | 0.4 | $ | 1.5 | $ | 0.9 | $ | 3.0 | |||||||
Interest cost | 2.3 | 3.2 | 4.5 | 6.5 | |||||||||||
Expected return on plan assets | (4.3 | ) | (4.6 | ) | (8.5 | ) | (9.2 | ) | |||||||
Amortization: | |||||||||||||||
Prior service credits | (0.9 | ) | (0.9 | ) | (1.8 | ) | (1.8 | ) | |||||||
Net actuarial loss | 1.4 | — | 2.8 | 3.1 | |||||||||||
Net periodic benefit cost to continuing operations | $ | (1.1 | ) | $ | (0.8 | ) | $ | (2.1 | ) | $ | 1.6 |
|
(In Millions) | |||||||
Capital Leases | Operating Leases | ||||||
2016 (July 1 - December 31) | $ | 12.4 | $ | 4.6 | |||
2017 | 22.8 | 8.9 | |||||
2018 | 18.4 | 7.5 | |||||
2019 | 10.2 | 4.9 | |||||
2020 | 9.2 | 4.9 | |||||
2021 and thereafter | 9.3 | 5.0 | |||||
Total minimum lease payments | $ | 82.3 | $ | 35.8 | |||
Amounts representing interest | 15.4 | ||||||
Present value of net minimum lease payments | $ | 66.9 | (1) |
(1) | The total is comprised of $18.2 million and $48.7 million classified as Other current liabilities and Other liabilities, respectively, in the Statements of Unaudited Condensed Consolidated Financial Position at June 30, 2016. |
|
(In Millions) | |||||||
June 30, 2016 | December 31, 2015 | ||||||
Environmental | $ | 3.5 | $ | 3.6 | |||
Mine closure | |||||||
LTVSMC | 24.8 | 24.1 | |||||
Operating mines: | |||||||
U.S. Iron Ore | 174.5 | 189.9 | |||||
Asia Pacific Iron Ore | 17.2 | 16.4 | |||||
Total mine closure | 216.5 | 230.4 | |||||
Total environmental and mine closure obligations | 220.0 | 234.0 | |||||
Less current portion | 2.6 | 2.8 | |||||
Long term environmental and mine closure obligations | $ | 217.4 | $ | 231.2 |
(In Millions) | |||||||
June 30, 2016 | December 31, 2015 | ||||||
Asset retirement obligation at beginning of period | $ | 206.3 | $ | 142.4 | |||
Accretion expense | 5.8 | 6.5 | |||||
Exchange rate changes | 0.4 | (1.1 | ) | ||||
Revision in estimated cash flows | (20.8 | ) | 58.5 | ||||
Asset retirement obligation at end of period | $ | 191.7 | $ | 206.3 |
|
(In Millions) | |||||||||||||||||||||||||
June 30, 2016 | December 31, 2015 | ||||||||||||||||||||||||
Classification | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | |||||||||||||||||||
Definite-lived intangible assets: | |||||||||||||||||||||||||
Permits | Other non-current assets | $ | 78.6 | $ | (22.8 | ) | $ | 55.8 | $ | 78.4 | $ | (20.2 | ) | $ | 58.2 | ||||||||||
Total intangible assets | $ | 78.6 | $ | (22.8 | ) | $ | 55.8 | $ | 78.4 | $ | (20.2 | ) | $ | 58.2 | |||||||||||
Below-market sales contracts | Other current liabilities | $ | (23.1 | ) | $ | 7.7 | $ | (15.4 | ) | $ | (23.1 | ) | $ | — | $ | (23.1 | ) | ||||||||
Below-market sales contracts | Other liabilities | (205.8 | ) | 205.8 | — | (205.8 | ) | 205.8 | — | ||||||||||||||||
Total below-market sales contracts | $ | (228.9 | ) | $ | 213.5 | $ | (15.4 | ) | $ | (228.9 | ) | $ | 205.8 | $ | (23.1 | ) |
(In Millions) | |||
Amount | |||
Year Ending December 31, | |||
2016 (remaining six months) | $ | 1.8 | |
2017 | 4.2 | ||
2018 | 4.2 | ||
2019 | 2.5 | ||
2020 | 2.5 | ||
2021 | 2.5 | ||
Total | $ | 17.7 |
|
(In Millions) | |||||||||||||||||||||||
Derivative Assets | Derivative Liabilities | ||||||||||||||||||||||
June 30, 2016 | December 31, 2015 | June 30, 2016 | December 31, 2015 | ||||||||||||||||||||
Derivative Instrument | Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | |||||||||||||||
Customer Supply Agreement | Other current assets | 23.7 | Other current assets | 5.8 | — | — | |||||||||||||||||
Provisional Pricing Arrangements | Other current assets | 2.1 | Other current assets | 2.0 | Other current liabilities | 2.6 | Other current liabilities | 3.4 | |||||||||||||||
Commodity Contracts | — | — | — | Other current liabilities | 0.6 | ||||||||||||||||||
Total derivatives not designated as hedging instruments under ASC 815 | $ | 25.8 | $ | 7.8 | $ | 2.6 | $ | 4.0 |
(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, | |||||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||||
Customer Supply Agreement | Product revenues | 19.5 | 0.4 | 19.9 | 10.5 | |||||||||||
Provisional Pricing Arrangements | Product revenues | 1.8 | 8.4 | 0.3 | (7.8 | ) | ||||||||||
Foreign Exchange Contracts | Other non-operating income (expense) | — | (3.4 | ) | — | 2.5 | ||||||||||
Commodity Contracts | Cost of goods sold and operating expenses | — | 0.2 | — | (3.4 | ) | ||||||||||
Foreign Exchange Contracts | Product revenues | — | (9.7 | ) | — | (9.7 | ) | |||||||||
$ | 21.3 | $ | (4.1 | ) | $ | 20.2 | $ | (7.9 | ) |
|
(In Millions) | ||||||||||||||||||
Canadian Operations | ||||||||||||||||||
North American Coal | Eastern Canadian Iron Ore | Other | Total Canadian Operations | Total of Discontinued Operations | ||||||||||||||
Statements of Unaudited Condensed Consolidated Operations | ||||||||||||||||||
Income (Loss) from Discontinued Operations, net of tax | QTD June 30, 2016 | $ | (0.7 | ) | $ | 0.3 | $ | — | $ | 0.3 | $ | (0.4 | ) | |||||
Income (Loss) from Discontinued Operations, net of tax | QTD June 30, 2015 | $ | (31.5 | ) | $ | 134.9 | $ | — | $ | 134.9 | $ | 103.4 | ||||||
Income (Loss) from Discontinued Operations, net of tax | YTD June 30, 2016 | $ | (2.0 | ) | $ | 4.1 | $ | — | $ | 4.1 | $ | 2.1 | ||||||
Income (Loss) from Discontinued Operations, net of tax | YTD June 30, 2015 | $ | (107.2 | ) | $ | (717.8 | ) | $ | (0.1 | ) | $ | (717.9 | ) | $ | (825.1 | ) | ||
Statements of Unaudited Condensed Consolidated Financial Position | ||||||||||||||||||
Short-term assets of discontinued operations | As of June 30, 2016 | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||
Short-term liabilities of discontinued operations | As of June 30, 2016 | $ | 4.4 | $ | — | $ | — | $ | — | $ | 4.4 | |||||||
Short-term assets of discontinued operations | As of December 31, 2015 | $ | 14.9 | $ | — | $ | — | $ | — | $ | 14.9 | |||||||
Short-term liabilities of discontinued operations | As of December 31, 2015 | $ | 6.9 | $ | — | $ | — | $ | — | $ | 6.9 | |||||||
Non-Cash Operating and Investing Activities | ||||||||||||||||||
Depreciation, depletion and amortization: | YTD June 30, 2015 | $ | 3.2 | $ | — | $ | — | $ | — | $ | 3.2 | |||||||
Purchase of property, plant and equipment | YTD June 30, 2015 | $ | 5.5 | $ | — | $ | — | $ | — | $ | 5.5 | |||||||
Impairment of other long-lived assets | YTD June 30, 2015 | $ | 73.4 | $ | — | $ | — | $ | — | $ | 73.4 |
(In Millions) | ||||||||
Assets and Liabilities of Discontinued Operations(1) | June 30, 2016 | December 31, 2015 | ||||||
Other current assets | $ | — | $ | 14.9 | ||||
Total assets of discontinued operations | $ | — | $ | 14.9 | ||||
Accrued liabilities | $ | 0.3 | $ | — | ||||
Other current liabilities(1) | 4.1 | 6.9 | ||||||
Total liabilities of discontinued operations | $ | 4.4 | $ | 6.9 | ||||
(1) At June 30, 2016 and December 31, 2015, we had $5.8 million and $7.8 million, respectively, of contingent liabilities associated with our exit from the coal business recorded on our parent company. |
(In Millions) | ||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
Loss from Discontinued Operations | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Revenues from product sales and services | $ | — | $ | 142.7 | $ | — | $ | 259.3 | ||||||||
Cost of goods sold and operating expenses | — | (167.0 | ) | — | (274.3 | ) | ||||||||||
Sales margin | — | (24.3 | ) | — | (15.0 | ) | ||||||||||
Other operating expense | (0.8 | ) | (7.1 | ) | (2.0 | ) | (18.3 | ) | ||||||||
Other expense | — | (0.5 | ) | — | (1.0 | ) | ||||||||||
Loss from discontinued operations before income taxes | (0.8 | ) | (31.9 | ) | (2.0 | ) | (34.3 | ) | ||||||||
Impairment of long-lived assets | — | — | — | (73.4 | ) | |||||||||||
Income tax benefit (expense) | 0.1 | 0.4 | — | 0.5 | ||||||||||||
Loss from discontinued operations, net of tax | $ | (0.7 | ) | $ | (31.5 | ) | $ | (2.0 | ) | $ | (107.2 | ) |
(In Millions) | ||||||||||||||||
Three Months Ended June 30, | Six Months Ended June, | |||||||||||||||
Gain (Loss) from Discontinued Operations | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Revenues from product sales and services | $ | — | $ | — | $ | — | $ | 11.3 | ||||||||
Cost of goods sold and operating expenses | — | — | — | (11.1 | ) | |||||||||||
Sales margin | — | — | — | 0.2 | ||||||||||||
Other operating expense | — | (0.5 | ) | — | (33.8 | ) | ||||||||||
Other expense | — | — | — | (1.0 | ) | |||||||||||
Loss from discontinued operations before income taxes | — | (0.5 | ) | — | (34.6 | ) | ||||||||||
Gain (loss) from deconsolidation | 0.3 | 134.7 | 4.1 | (684.0 | ) | |||||||||||
Income tax benefit (expense) | — | 0.7 | — | 0.7 | ||||||||||||
Gain (loss) from discontinued operations, net of tax | $ | 0.3 | $ | 134.9 | $ | 4.1 | $ | (717.9 | ) |
(In Millions) | ||||||||||||||||||||
June 30, 2016 | ||||||||||||||||||||
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 Gains | |||||||||||||||
Assets: | ||||||||||||||||||||
Loans to and accounts receivables from the Canadian Entities | $ | — | $ | — | $ | 70.2 | $ | 70.2 | $ | 4.1 | ||||||||||
Liabilities: | ||||||||||||||||||||
Contingent liabilities | $ | — | $ | — | $ | 38.7 | $ | 38.7 | $ | — |
(In Millions) | ||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||||
Investment impairment on deconsolidation1 | $ | 0.3 | $ | (4.4 | ) | $ | 4.1 | $ | (480.4 | ) | ||||||
Contingent liabilities | — | 139.1 | — | (203.6 | ) | |||||||||||
Total gain (loss) from deconsolidation | $ | 0.3 | $ | 134.7 | $ | 4.1 | $ | (684.0 | ) | |||||||
1 Includes the adjustment to fair value of our remaining interest in the Canadian Entities. |
|
(In Millions) | |||||||
Six Months Ended June 30, | |||||||
2016 | 2015 | ||||||
Capital additions (1) | $ | 18.1 | $ | 46.8 | |||
Cash paid for capital expenditures | 20.2 | 34.4 | |||||
Difference (Non-cash accruals) | $ | (2.1 | ) | $ | 12.4 |
(1) | Includes capital additions of $18.1 million related to continuing operations for the six months ended June 30, 2016. Includes capital additions of $28.9 million and $17.9 million related to continuing operations and discontinued operations, respectively, for the six months ended June 30, 2015. |
|
Mine | Cliffs Natural Resources | ArcelorMittal | U.S. Steel Corporation | ||||||
Empire | 79.0 | % | 21.0 | % | — | ||||
Tilden | 85.0 | % | — | 15.0 | % | ||||
Hibbing | 23.0 | % | 62.3 | % | 14.7 | % |
(In Millions) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Product revenues from related parties | $ | 241.6 | $ | 149.6 | $ | 345.0 | $ | 260.0 | |||||||
Total product revenues | 452.8 | 454.3 | 728.4 | 857.4 | |||||||||||
Related party product revenue as a percent of total product revenue | 53.4 | % | 32.9 | % | 47.4 | % | 30.3 | % |
|
(In Millions, Except Per Share Amounts) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Income (Loss) from Continuing Operations | $ | 29.9 | $ | (38.2 | ) | $ | 144.2 | $ | 128.6 | ||||||
Income from Continuing Operations Attributable to Noncontrolling Interest | (16.7 | ) | (5.0 | ) | (25.5 | ) | (3.1 | ) | |||||||
Net Income (Loss) from Continuing Operations Attributable to Cliffs Shareholders | $ | 13.2 | $ | (43.2 | ) | $ | 118.7 | $ | 125.5 | ||||||
Income (Loss) from Discontinued Operations, net of tax | (0.4 | ) | 103.4 | 2.1 | (825.1 | ) | |||||||||
Net Income (Loss) Attributable to Cliffs Shareholders | $ | 12.8 | $ | 60.2 | $ | 120.8 | $ | (699.6 | ) | ||||||
Preferred Stock Dividends | — | — | — | (12.8 | ) | ||||||||||
Net Income (Loss) Attributable to Cliffs Common Shareholders | $ | 12.8 | $ | 60.2 | $ | 120.8 | $ | (712.4 | ) | ||||||
Weighted Average Number of Shares: | |||||||||||||||
Basic | 182.3 | 153.2 | 177.0 | 153.2 | |||||||||||
Depositary Shares | — | — | — | 25.2 | |||||||||||
Employee Stock Plans | 2.3 | — | 1.3 | 0.3 | |||||||||||
Diluted | 184.6 | 153.2 | 178.3 | 178.7 | |||||||||||
Earnings (Loss) per Common Share Attributable to Cliffs Common Shareholders - Basic: | |||||||||||||||
Continuing operations | $ | 0.07 | $ | (0.28 | ) | $ | 0.67 | $ | 0.74 | ||||||
Discontinued operations | — | 0.67 | 0.01 | (5.39 | ) | ||||||||||
$ | 0.07 | $ | 0.39 | $ | 0.68 | $ | (4.65 | ) | |||||||
Earnings (Loss) per Common Share Attributable to Cliffs Common Shareholders - Diluted: | |||||||||||||||
Continuing operations | $ | 0.07 | $ | (0.28 | ) | $ | 0.67 | $ | 0.70 | ||||||
Discontinued operations | — | 0.67 | 0.01 | (4.62 | ) | ||||||||||
$ | 0.07 | $ | 0.39 | $ | 0.68 | $ | (3.92 | ) |
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