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Cliffs has record year, banner 4th quarter

Spurred by the highest global prices for iron ore ever seen, Cliffs Natural Resources reported Wednesday that 2011 was a record year for corporate profits.

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In Minnesota, Cliffs owns and operates North Shore Mining in Babbitt and Silver Bay and United Taconite in Eveleth and is part owner and operate of Hibbing Taconite, shown here. News Tribune file.

Spurred by the highest global prices for iron ore ever seen, Cliffs Natural Resources reported Wednesday that 2011 was a record year for corporate profits.

The Cleveland-based company reported revenues hit a record $6.8 billion with shareholders earning $11.48 per share.

That's up $2.3 billion, or 85 percent, from 2010. Cliffs makes most of its money by producing and selling iron ore that's sold to customers based on contracts and market prices -- and those prices are more than double historic levels.

Cliffs also reported fourth-quarter revenues were $1.7 billion, a 17 percent increase compared with $1.4 billion in the same quarter 2010.

In addition, the company reported record global iron ore sales of 40 million tons from its operations in Minnesota, Michigan, Canada and Australia.

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In Minnesota, Cliffs owns and operates North Shore Mining in Babbitt and Silver Bay and United Taconite in Eveleth and is part owner and operate of Hibbing Taconite.

Cliffs reported one of the year's highlights was the $4.9 billion acquisition of Consolidated Thompson, an emerging iron ore producer in Eastern Canada. The move helped elevate Cliffs to both a Fortune 500 company and to the No. 7 ranking on the 2011 Barron's 500 America's Top Companies List.

In the company's year-end performance statement, Joseph Carrabba, Cliffs' chairman, president and chief executive officer, said "Cliffs delivered an exceptional performance in 2011, a year highlighted with the transformational acquisition of Consolidated Thompson. With a significant organic pipeline of growth in both iron ore and metallurgical coal, Cliffs is well positioned for continued momentum in 2012 and beyond."

Cliffs North American iron ore sales hit 7.8 million tons in the fourth quarter, up from 6.4 million tons in 2010, and soared to 24.2 million tons for the entire year, up from 23 million in 2010.

The price of iron ore has been bouncing around on the global market for the past two years, topping out at a record-high near $200 per ton last year before settling at about $140 in January, still more than double the average for the past 20 years. Continued strong demand for iron ore in China and India steel mills is driving the market which has less effect on Minnesota taconite producers that are owned and operated by steel companies and that don't sell on the open market.

In recent weeks Cliffs has been named in national business publications as one of the best opportunities for a corporate takeover because its stock was undervalued compared to the profits it was making. Cliffs' stock was at $68.68 Wednesday. It's ranged from $47.31 to $102.48 in recent months and sat at $2.18 in February 2002.

Related Topics: IRON RANGEMININGSILVER BAY
John Myers reports on the outdoors, natural resources and the environment for the Duluth News Tribune. You can reach him at jmyers@duluthnews.com.
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