CLEVELAND - Cliffs Natural Resources Inc. (NYSE:CLF) says it lost more than US$1.6 billion in the fourth quarter as it faced delays and unexpected costs from its acquisition of Consolidated Thompson Iron Mines more than a year ago.
The U.S. mining company reported Tuesday a loss attributed to shareholders of $11.36 per share, compared to a profit of $185.4 million, or $1.30 per share, in the same period a year earlier.
When factoring in non-controlling interests the overall loss increased to $1.87 billion from a $208.8 million profit a year earlier.
"The year proved to be challenging both from a market perspective and operationally," said president and CEO Joseph Carrabba in a release.
For 2012, the loss attributable to shareholders was $899.4 million compared to a $1.62 billion profit in the previous year, the company said.
The company also announced it would reduce its quarterly dividend by 75 per cent to 15 cents per share.
Cliffs Natural Resources has been grappling with a slowing global economy which has pushed down the price of iron ore, while it has faced delays in the ramp up of the Bloom Lake open pit iron mine in Quebec.
The miner bought Consolidated Thompson and its majority stake in the Bloom Lake open pit iron mine in Quebec in 2011 for $4.9 billion.
"We continue to make progress on the mine's production stability, development, and tailings management," Carrabba said.
"We believe this will ensure a smooth transition for Bloom Lake's Phase 2 production startup next year. Bloom Lake is on track to achieve an annual production run rate of 14 million tons by 2015, which accounts for more than a quarter of Cliffs' current total iron ore volume."
In January, Cliffs had disclosed that it would write down the value of Consolidated Thompson by US$1 billion in its fourth-quarter results, primarily because of lower long-term volumes to be produced by it as well as higher costs.
In its outlook, the company expects global iron ore sales to stay flat in 2013 compared to the previous year at 40 million tons.
The capital spending budget for the year has been increased to $800 million to $850 million from the previous plan of $700 to $800 million as it spends more on the Canadian iron ore business.
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