Cliffs Natural Resources Inc. (CLF - Free Report) announced that its employees represented by the United Steelworkers (“USW”) have ratified a new 3-year labor contract. The new agreement covers about 2,000 of the Cliffs’ USW-represented workforce in the Tilden and Empire mines, Michigan, as well as the United Taconite and Hibbing Taconite mines, Minnesota. The new contract is retroactively effective from Oct 1, 2015 through Sep 30, 2017.
The shares of the company fell 0.2% to close at $5.85 on Sep 30.
Cliffs’ adjusted earnings of 6 cents per share and sales of $496.2 million for the second quarter of 2016 topped the respective Zacks Consensus Estimates. The company raised its 2016 sales volume guidance for its U.S. Iron Ore division from 17.5 million long tons to 18 million long tons. The production volume guidance for 2016 has also been raised by 500,000 long tons to 16.5 million long tons.
Cliffs’ remains focused on reducing debt. Its total debt fell around 4% year over year to $2.7 billion at 2015 end and further reduced to $2.5 billion at the end of the second quarter. In the second quarter of 2016, the company paid off the remaining balance of the outstanding equipment loans of $23 million. These measures will also help reduce Cliffs’ interest expenses.
Management has lowered its interest payment guidance from $220 million to $200 million for 2016. The company also received $31 million in cash as part of a long-term purchased power arrangement with Minnesota Power in the quarter.
Cliffs currently carries a Zacks Rank #2 (Buy).
Stocks to Consider
Some other favorably-ranked companies in the mining space include New Gold Inc. (NGD - Free Report) , AngloGold Ashanti Ltd. (AU - Free Report) and IAMGOLD Corp. (IAG - Free Report) .
New Gold sports a Zacks Rank #1 and has an expected earnings growth of 491.7% for the current year. You can see the complete list of today’s Zacks #1 Rank stocks here.
AngloGold Ashanti has an expected earnings growth of 440% for the current year. The company sports a Zacks Rank #2.
IAMGOLD carries a Zacks Rank #2 and has an expected earnings growth of 111.6% for the current year.
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