“Steel demand remained healthy throughout the entire year, with our most important market — the automotive sector — performing well,” he said, noting this occurred even with the UAW labor strike that started in the third quarter and stretched into the fourth.
The company’s full-year net income stood at $450 million, a significant decrease from the previous year’s $1.4 billion. The reduction was primarily driven by lower steel index pricing in 2023, according to Goncalves.
Cleveland-Cliffs generated $2.3 billion in cash flow from operations and achieved a free cash flow of $1.6 billion, the company announced. Goncalves said the company used the majority of this free cash flow to reduce its net debt by $1.3 billion, surpassing its publicly stated target by ending the year with a net debt of $2.9 billion.
The total steel shipments of 16.4 million tons set a record since Cleveland-Cliffs became a steel company in 2020. It now has four consecutive quarters with steel shipments above 4 million tons, he said.
“Together with expected strong shipments in 2024, we should continue to generate healthy free cash flow throughout the year,” he said. “With our net debt target achieved and our shares still undervalued, we can now put a stronger focus on aggressive share buybacks.”
Cleveland-Cliffs purchased AK Steel for $1.1 billion in 2020. After that the Cleveland-based company bought the U.S. assets of ArcelorMittal for $1.4 billion, making it the largest flat-rolled steel producer in North America, officials said.