Cleveland-Cliffs Inc. returned to profit in the third quarter as steel prices and sales volumes rose, while announcing a decision to indefinitely idle galvanizing lines at its Stelco business in Canada.
Chairman and CEO Lourenco Goncalves said Canada’s galvanized steel market is oversupplied. The decision affects Stelco workers, though Goncalves said they would return when conditions improve. He said a shift toward hot-rolled steel would maintain Stelco’s total output and preserve approximately 2,000 Canadian jobs.
Net income reached $165 million, or $0.26 per diluted share, after a $134 million loss in the second quarter. Cleveland-Cliffs lost $234 million a year earlier. Revenue rose to $5.6 billion from $5.2 billion in the previous quarter. The earnings release was furnished with the company’s Oct. 19 SEC filing.
The average selling price for steel products increased to $1,177 per net ton from $1,124 in the second quarter. Steel product external sales volumes in the steelmaking segment grew to 4.15 million net tons from 4.025 million. The company separately reported total steel shipments of 4.2 million net tons for the quarter.
Adjusted earnings before interest, taxes, depreciation and amortization, or EBITDA, climbed to $612 million from $286 million in the second quarter. That exceeded Cleveland-Cliffs’ earlier guidance of $575 million. The results follow an earlier earnings-calendar preview listing Cleveland-Cliffs among Monday’s expected reports.
Goncalves described the quarter as Stelco’s strongest since Cleveland-Cliffs acquired the business two years ago. For the fourth quarter, the company projects adjusted EBITDA of about $715 million, with higher prices partly offset by seasonal effects, maintenance outages and costs. It also forecasts adjusted EBITDA above $4 billion in 2027, basing that projection on new customer contracts and current price-index expectations.
