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SEGMENT REPORTING | 12 Months Ended
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Dec. 31, 2014
Segment Reporting [Abstract] |
SEGMENT REPORTING | NOTE 2 - SEGMENT REPORTING Our Company’s operations are organized and managed according to product category and geographic location: U.S. Iron Ore, Asia Pacific Iron Ore, North American Coal and Eastern Canadian Iron Ore. The U.S. Iron Ore segment is comprised of our interests in five U.S. mines that provide iron ore to the integrated steel industry. The Asia Pacific Iron Ore segment is located in Western Australia and provides iron ore to the seaborne market for Asian steel producers. The North American Coal segment as of December 31, 2014 is comprised of our two low-volatile metallurgical coal operations that provide metallurgical coal primarily to the integrated steel industry. Effective December 31, 2014, we sold our CLCC assets, which consisted of two high-volatile metallurgical coal mines and one thermal coal mine. As such, the results below include the CLCC results through the day of the sale completion. The Eastern Canadian Iron Ore segment is comprised of two Eastern Canadian mines that primarily provided iron ore to the seaborne market for Asian steel producers. Refer to NOTE 21 - SUBSEQUENT EVENTS for further discussion of our Bloom Lake mine, which is in the Eastern Canadian Iron Ore segment. There were no intersegment revenues in 2014 or 2012. Inter-segment revenues for 2013 were eliminated in consolidation. We have historically evaluated segment performance based on sales margin, defined as revenues less cost of goods sold, and operating expenses identifiable to each segment. Additionally, beginning in the third quarter of 2014, concurrent with the change in control on July 29, 2014, management began to evaluate segment performance based on EBITDA, defined as Net Income (Loss) before interest, income taxes, depreciation, depletion and amortization, and Adjusted EBITDA, defined as EBITDA excluding certain items such as impairment charges, impacts of permanently idled, closed or sold facilities, foreign currency remeasurement, severance and other costs associated with the acceleration of vesting and payout of outstanding equity grants due to the majority change in our Board of Directors, litigation judgments and intersegment corporate allocations of SG&A costs. Management uses and believes that investors benefit from referring to these measures in evaluating operating and financial results, as well as in planning, forecasting and analyzing future periods as these financial measures approximate the cash flows associated with the operational earnings. The following tables present a summary of our reportable segments for the years ended December 31, 2014, 2013 and 2012, including a reconciliation of segment sales margin to Income (Loss) from Continuing Operations Before Income Taxes and Equity Income (Loss) from Ventures and a reconciliation of Net Income (Loss) to EBITDA and Adjusted EBITDA:
| (In Millions)
| 2014 |  | 2013 |  | 2012
Revenues from product sales and services: |  |  |  |  |  |  |  |  |  |  |
U.S. Iron Ore | $ | 2,506.5 |  |  | 54% |  | $ | 2,667.9 |  |  | 47% |  | $ | 2,723.3 |  |  | 46%
Asia Pacific Iron Ore | 866.7 |  |  | 19% |  | 1,224.3 |  |  | 22% |  | 1,259.3 |  |  | 22%
North American Coal | 687.1 |  |  | 15% |  | 821.9 |  |  | 14% |  | 881.1 |  |  | 15%
Eastern Canadian Iron Ore | 563.4 |  |  | 12% |  | 978.7 |  |  | 17% |  | 1,008.9 |  |  | 17%
Other (including inter-segment revenue eliminations) | — |  |  | —% |  | (1.4 | ) |  | —% |  | 0.1 |  |  | —%
Total revenues from product sales and services | $ | 4,623.7 |  |  | 100% |  | $ | 5,691.4 |  |  | 100% |  | $ | 5,872.7 |  |  | 100%
Sales margin: |  |  |  |  |  |  |  |  |  |  |
U.S. Iron Ore | $ | 710.4 |  |  |  |  | $ | 901.9 |  |  |  |  | $ | 976.2 |  |  |
Asia Pacific Iron Ore | 121.7 |  |  |  |  | 367.1 |  |  |  |  | 311.0 |  |  |
North American Coal | (135.8 | ) |  |  |  | (14.5 | ) |  |  |  | (1.8 | ) |  |
Eastern Canadian Iron Ore | (244.9 | ) |  |  |  | (103.3 | ) |  |  |  | (121.4 | ) |  |
Other (including inter-segment sales margin eliminations) | — |  |  |  |  | (1.9 | ) |  |  |  | 8.1 |  |  |
Sales margin | 451.4 |  |  |  |  | 1,149.3 |  |  |  |  | 1,172.1 |  |  |
Other operating income (expense) | (9,896.7 | ) |  |  |  | (478.3 | ) |  |  |  | (1,480.9 | ) |  |
Other income (expense) | (158.4 | ) |  |  |  | (181.7 | ) |  |  |  | (193.0 | ) |  |
Income (loss) from continuing operations before income taxes and equity income (loss) from ventures | $ | (9,603.7 | ) |  |  |  | $ | 489.3 |  |  |  |  | $ | (501.8 | ) |  |
| (In Millions)
| 2014 |  | 2013 |  | 2012
Net Income (Loss) | $ | (8,311.6 | ) |  | $ | 361.8 |  |  | $ | (1,126.6 | )
Less: |  |  |  |  |
Interest expense, net | (185.2 | ) |  | (179.1 | ) |  | (195.6 | )
Income tax benefit (expense) | 1,302.0 |  |  | (55.1 | ) |  | (255.9 | )
Depreciation, depletion and amortization | (504.0 | ) |  | (593.3 | ) |  | (525.8 | )
EBITDA | $ | (8,924.4 | ) |  | $ | 1,189.3 |  |  | $ | (149.3 | )
Less: |  |  |  |  |
Impairment of goodwill and other long-lived assets | $ | (9,029.9 | ) |  | $ | (250.8 | ) |  | $ | (1,049.9 | )
Impairment of equity method investment | — |  |  | — |  |  | (365.4 | )
Loss on sale of Cliffs Logan County Coal | (419.6 | ) |  | — |  |  | — |
Wabush mine impact | (158.7 | ) |  | (72.7 | ) |  | (30.1 | )
Bloom Lake mine impact | (137.9 | ) |  | 46.5 |  |  | 6.4 |
Foreign exchange remeasurement | 30.7 |  |  | 64.0 |  |  | (3.2 | )
Proxy contest and change in control costs in SG&A | (26.6 | ) |  | — |  |  | — |
Litigation judgment | (96.3 | ) |  | (9.6 | ) |  | — |
Severance in SG&A | (15.8 | ) |  | (16.4 | ) |  | — |
Total Adjusted EBITDA | $ | 929.7 |  |  | $ | 1,428.3 |  |  | $ | 1,292.9 |
EBITDA: |  |  |  |  |
U.S. Iron Ore | $ | 805.6 |  |  | $ | 1,000.1 |  |  | $ | 1,045.3 |
Asia Pacific Iron Ore | (369.8 | ) |  | 500.4 |  |  | 387.3 |
North American Coal | (1,326.8 | ) |  | 129.5 |  |  | 74.0 |
Eastern Canadian Iron Ore | (7,673.9 | ) |  | (192.8 | ) |  | (1,103.3 | )
Other | (359.5 | ) |  | (247.9 | ) |  | (552.6 | )
Total EBITDA | $ | (8,924.4 | ) |  | $ | 1,189.3 |  |  | $ | (149.3 | )
Adjusted EBITDA: |  |  |  |  |
U.S. Iron Ore | $ | 831.2 |  |  | $ | 1,030.8 |  |  | $ | 1,085.6 |
Asia Pacific Iron Ore | 264.6 |  |  | 525.7 |  |  | 402.1 |
North American Coal | (28.5 | ) |  | 154.0 |  |  | 106.7 |
Eastern Canadian Iron Ore | — |  |  | — |  |  | — |
Other | (137.6 | ) |  | (282.2 | ) |  | (301.5 | )
Total Adjusted EBITDA | $ | 929.7 |  |  | $ | 1,428.3 |  |  | $ | 1,292.9 |
| (In Millions)
| 2014 |  | 2013 |  | 2012
Depreciation, depletion and amortization: |  |  |  |  |
U.S. Iron Ore | $ | 107.4 |  |  | $ | 120.3 |  |  | $ | 100.9 |
Asia Pacific Iron Ore | 145.9 |  |  | 153.7 |  |  | 151.9 |
North American Coal | 106.9 |  |  | 128.9 |  |  | 98.2 |
Eastern Canadian Iron Ore | 135.6 |  |  | 178.5 |  |  | 160.2 |
Other | 8.2 |  |  | 11.9 |  |  | 14.6 |
Total depreciation, depletion and amortization | $ | 504.0 |  |  | $ | 593.3 |  |  | $ | 525.8 |
Capital additions 1: |  |  |  |  |
U.S. Iron Ore | $ | 48.4 |  |  | $ | 53.3 |  |  | $ | 168.8 |
Asia Pacific Iron Ore | 10.8 |  |  | 13.0 |  |  | 87.7 |
North American Coal | 28.8 |  |  | 55.0 |  |  | 144.1 |
Eastern Canadian Iron Ore | 141.2 |  |  | 625.5 |  |  | 865.2 |
Other | 6.3 |  |  | 5.5 |  |  | 69.5 |
Total capital additions | $ | 235.5 |  |  | $ | 752.3 |  |  | $ | 1,335.3 |
1 Includes capital lease additions and non-cash accruals. Refer to NOTE 17 - CASH FLOW INFORMATION. A summary of assets by segment is as follows:
| (In Millions)
| December 31, 2014 |  | December 31, 2013 |  | December 31, 2012
Assets: |  |  |  |  |
U.S. Iron Ore | $ | 1,598.3 |  |  | $ | 1,671.6 |  |  | $ | 1,735.1 |
Asia Pacific Iron Ore | 274.6 |  |  | 1,078.4 |  |  | 1,506.3 |
North American Coal | 274.2 |  |  | 1,841.8 |  |  | 1,877.8 |
Eastern Canadian Iron Ore | 305.8 |  |  | 7,915.5 |  |  | 7,605.1 |
Other | 164.3 |  |  | 455.6 |  |  | 570.9 |
Total segment assets | 2,617.2 |  |  | 12,962.9 |  |  | 13,295.2 |
Corporate | 546.8 |  |  | 159.0 |  |  | 279.7 |
Total assets | $ | 3,164.0 |  |  | $ | 13,121.9 |  |  | $ | 13,574.9 |
Included in the consolidated financial statements are the following amounts relating to geographic location:
| (In Millions)
| 2014 |  | 2013 |  | 2012
Revenue |  |  |  |  |
United States | $ | 2,139.4 |  |  | $ | 1,857.6 |  |  | $ | 2,108.5 |
China | 1,049.0 |  |  | 1,909.4 |  |  | 2,008.2 |
Canada | 439.1 |  |  | 871.2 |  |  | 728.1 |
Other countries | 996.2 |  |  | 1,053.2 |  |  | 1,027.9 |
Total revenue | $ | 4,623.7 |  |  | $ | 5,691.4 |  |  | $ | 5,872.7 |
Property, Plant and Equipment, Net |  |  |  |  |
United States | $ | 1,093.7 |  |  | $ | 2,721.6 |  |  | $ | 2,795.3 |
Australia | 72.4 |  |  | 751.0 |  |  | 1,042.4 |
Canada | 248.8 |  |  | 7,680.8 |  |  | 7,369.6 |
Total Property, Plant and Equipment, Net | $ | 1,414.9 |  |  | $ | 11,153.4 |  |  | $ | 11,207.3 |
Concentrations in Revenue In 2014, two customers accounted for more than 10 percent of our consolidated product revenue. In 2013 and 2012, one customer in each year individually accounted for more than 10 percent of our consolidated product revenue. Total revenue from these customers accounted for more than 10 percent of our consolidated product revenues and represents approximately $1.6 billion, $1.0 billion and $0.9 billion of our total consolidated product revenue in 2014, 2013 and 2012, respectively, and is attributable to our U.S. Iron Ore, North American Coal and Eastern Canadian Iron Ore business segments. The following table represents the percentage of our total revenue contributed by each category of products and services in 2014, 2013, and 2012:
|  | 2014 |  | 2013 |  | 2012
Revenue Category |  |  |  |  |  |
Iron ore |  | 78 | % |  | 80 | % |  | 81 | %
Coal |  | 12 | % |  | 13 | % |  | 13 | %
Freight and venture partners’ cost reimbursements |  | 10 | % |  | 7 | % |  | 6 | %
Total revenue |  | 100 | % |  | 100 | % |  | 100 | %

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 29 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8864-108599 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8933-108599 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8844-108599 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 10 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8538-108599 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8380-108599 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8981-108599 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 35 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8984-108599 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 30 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8906-108599 Reference 10: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9054-108599 Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8924-108599 Reference 12: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9031-108599 Reference 13: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 33 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8971-108599 Reference 14: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 12 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8595-108599 + Details
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