1.Buyback some $100 mil -$150 mil worth shares.
2. Sell Coal mines and at least tell SH the status of the sale. Same about BL mine
3.CLF has near monopoly in USA.. Enhance US IO sales to at least 25 mil tons, improve gross margins to $30/ton and develop better relations with steel companies.
4. Paydown at least $100mil-$150 mil Debt every QTR. This will help reduce interest as time goes by.
5.Be visible and SH pro-active. Discuss with WS your turnaround Strategy.
LG talks good in CC but NOT following up with actions. The communication is the biggest problem. The sale of Coal mines, buybacks, BL solution , DR pellets status with NUE ,improving Gross margins, Liquidity and total Debt ( and how to pay it down) are the major issues that need to be URGENTLY addressed.
CLF is a great company if run RIGHT. Kirsch and his cronies destroyed it earlier and thought LG would do much better job that CASA promised when they took the control of the CLF's Board. They didn't do much of what they promised. Now the debt is still very high interest payments are huge and Gross margins are eroding . What is the solution? It doesnt take a Rocket scientist but can be done . Stop Talking and take the actions. That is the mantra. Like I have said before Do as follows:
1. Sell the F* 2 remaining Coal mines ASAP at whatever the best price offered and reduce debt..
2. Develop Closer and better relationships with steel companies to sell at least 25 mil tons annually from domestic US IO. operations. Work with Gov./Congress to stop cheap Imports of steel.
3. CLF has near monopoly in US markets and don't understand why their sales are shrinking. They need a better Marketing and sales staff and personal involvement of LG
4. I still say cut SG&A expenses to $75 mil from $120 mil as Coal mines be gone and useless Dept like IR are closed down.Cut travel and other cost and other perks. There is still room to cut more CapEx and SG&A cost till CLF becomes profitable. Cut across the board salaries by 20%.
5. Improve US IO gross margins to $30/ton.. A MUST and make APIO profitable taking advantage of Lower AUD
6. Must buyback some 25 mil shares to stop SHORTS from further destroying the SP . Use some of $200 mil that Board has authorized for the buybacks
7. LG needs to tell Shareholders the current status of BL and other Ecan operations and keep them updated regularly. Even getting just $300mil-$500 mil out of this Canadian mess will be worth walking away with.
8. Get rid of Pref Dividend after the end of 2015
All this NOT hard to do. Just need to use some Common Sense and CLF can become great again and very profitable. Even I can do it as I have done with my company when times were bad in 2008-2010
red..i am at this point but this company can be turned around. like I have said over and over here by SWIFT actions and not words.
I just want CLF to show positive earnings for Q-3 and Q-4. if they do they can pay down debt slowly. But I doubt they will report earnings instead loss. surf.. i am trying to be practical here. yes.. it can be done..I said it.. but LG has to do it by actions and not just talk.
imagine.. thanks. I still think CLF can be turned around. I have seem in the past some worst companies than CLF were turned around. so its possible but NOT by sitting in their Corporate offices but by taking SOLID ACTIONS whatever they may be ... selling assets fast ,expanding business and more deals with steel companies and buyback some 20 mil plus shares at this low low price and scaring the hell out of Shorts.
CLF SP down 7.5% @ $2.96 well under $3, and DOW is down almost 300 points. CLF has huge problems.
Untill the MNGT is ready to address Total Debt and yearly Interest payment issues. The fact is that ONLY the US IO business has to carry the whole burden and if they are going to show the Quarterly profit, they must sell a lot more US IO than 19.5 mil and min gross margins will have to be at least $30/ton and a
lot more Cost cutting is needed.
I have read VL report on CLF thoroughly and it has scared the hell out of me. But it can be done by ACTIONS and NOT talk and selling Non-core assets at the fastest pace. Coal mines going to take 5 yrs to come back,if ever, and Cliffs doesn't have the time. I am willing to wait if they take some concrete actions to correct some of these issues.
SG&A may be reduced by another 20%-25%. if they sell Coal mines. APIO is still profitable mainly due to AUD trades at a huge discount and it has a life of only 2 more years. So Its all comes down to USIO Operations and how they handle it and expand that.business..which is a MUST.
It is all about debt of $2.88 B and how CLF will pay in the light of depressed IO price and Big steel imports and lower IO usage and lower margins.
Tts because Q-3 revenues of US IO will be lower and Margins not too great. Est . are a loss of $0.26. Tax
refund is drying up and Nothing is getting sold and Interest expenses due to Bond buying are increasing..
surf.. Thanks. I have known Kelly Tompkins for over 30 years . HIS FAMILY lived across from us once for many years and he is a very capable person. I respect him as a CFO of CLF. I w'll ask lishe if he would post a copy of KT's presentation here.
CLF needs to establish great LT Relationships with both MT and NUE to supply Exclusively all their need of IO pallets and also look for other smaller customers. It can be done as they have a near monopoly in USA IO market. They Must do this to generate higher revenues and better Margins to meet their daily expenses and start paying off debt slowly. They must also lower the cost of US IO production by another $5/ton..... my 2 cents worth.
To pay all expenses and reduce debt? Their best Operating Unit USIO' yearly Volume are down and margins are drastically reduced in Q-2 . How they can make ends meet w/o selling Coal asset and finalizing BL and get some money out of it.. They also MUST increase and expand US IO Operations and margins This is their Only hope. Does LG recognize this and any ideas here?