The international mining and natural resources company is expected to post "reduced volumes (-15%) and lower EBITDA (-5%)," analysts said.
"Cliffs determined that the potential to reach an agreement with prospective equity partners will not be possible by YE14 for its BL operations. Estimated closure costs to be $650-700m (including take-or-pay contracts) over five years, but is considered to be 'worst case scenario,'" analysts said.
"Closure costs could be lowered and potential offsets could emerge (lower SG&A, reduced capex). Cliffs [will] rely primarily on U.S. iron ore segment, while it continues to entertain potential sale of Asia Pacific iron ore and NA Coal segments," analysts added.
Shares of Cliff Natural Resources are down 2.08% to $8 in pre-market trading.
Separately, TheStreet Ratings team rates CLIFFS NATURAL RESOURCES INC as a Sell with a ratings score of D-. TheStreet Ratings Team has this to say about their recommendation:
"We rate CLIFFS NATURAL RESOURCES INC (CLF) a SELL. This is driven by multiple weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, generally high debt management risk, disappointing return on equity, weak operating cash flow and generally disappointing historical performance in the stock itself."