Cleveland-Cliffs (CLF) 10-K 18 Feb 10 2009 FY Annual report Financial data

Statement Of Financial Position

Statement Of Financial Position Classified (USD $)
In Millions	Dec. 31, 2009	Dec. 31, 2008
CURRENT ASSETS
Cash and cash equivalents	502.7	$179
Accounts receivable	103.5	68.5
Inventories	272.5	265.4
Supplies and other inventories	102.7	101.2
Deferred and refundable taxes	61.4	54.8
Derivative assets	51.5	76.9
Other current assets	66.9	115.9
TOTAL CURRENT ASSETS	1161.2	861.7
PROPERTY, PLANT AND EQUIPMENT, NET	2592.6	2456.1
OTHER ASSETS
Marketable securities	88.1	25.4
Investments in ventures	315.1	305.3
Goodwill	74.6	2
Intangible assets, net	114.8	109.6
Long-term receivables	49.8	33.4
Deferred income taxes	151.1	251.2
Deposits and miscellaneous	92	66.4
TOTAL OTHER ASSETS	885.5	793.3
TOTAL ASSETS	4639.3	4111.1
CURRENT LIABILITIES
Accounts payable	178.9	201
Accrued employment costs	78.4	98.9
Income taxes payable	6.1	99.3
State and local taxes payable	35.1	45.5
Below-market sales contracts - current	30.3	30.3
Accrued expenses	77.4	46.1
Deferred revenue	105.1	86.8
Derivative liabilities	0	194.3
Other current liabilities	59.1	42.7
TOTAL CURRENT LIABILITIES	570.4	844.9
POSTEMPLOYMENT BENEFIT LIABILITIES
Pensions	267.3	250.1
Other postretirement benefits	178.5	197.9
TOTAL POSTEMPLOYMENT BENEFIT LIABILITIES	445.8	448
ENVIRONMENTAL AND MINE CLOSURE OBLIGATIONS	124.3	104.9
DEFERRED INCOME TAXES	70.8	67.3
SENIOR NOTES	325	325
TERM LOAN	200	200
BELOW-MARKET SALES CONTRACTS	153.3	183.6
OTHER LIABILITIES	212.7	183.4
TOTAL LIABILITIES	2102.3	2357.1
3.25% REDEEMABLE CUMULATIVE CONVERTIBLE PERPETUAL PREFERRED STOCK - ISSUED 172,500 SHARES, 205 SHARES OUTSTANDING IN 2008	0	0.2
CLIFFS SHAREHOLDERS' EQUITY
Common Shares - par value $0.125 per share Authorized - 224,000,000 shares; Issued - 134,623,528 shares (2008 - 134,623,528 shares); Outstanding - 130,971,470 shares (2008 - 113,508,990 shares)	16.8	16.8
Capital in excess of par value of shares	695.4	442.2
Retained Earnings	1973.1	1799.9
Cost of 3,652,058 common shares in treasury (2008 - 21,114,538 shares)	-19.9	-113.8
Accumulated other comprehensive loss	-122.6	-394.6
TOTAL CLIFFS SHAREHOLDERS' EQUITY	2542.8	1750.5
NONCONTROLLING INTEREST	-5.8	3.3
TOTAL EQUITY	2,537	1753.8
COMMITMENTS AND CONTINGENCIES
TOTAL LIABILITIES AND EQUITY	4639.3	4111.1

1_Statement Of Financial Positi

Statement Of Financial Position Classified (Parenthetical) (USD $)
	Dec. 31, 2009	Dec. 31, 2008
3.25% REDEEMABLE CUMULATIVE CONVERTIBLE PERPETUAL PREFERRED STOCK, ISSUED	0	172,500
3.25% REDEEMABLE CUMULATIVE CONVERTIBLE PERPETUAL PREFERRED STOCK, OUTSTANDING	0	205
Preferred stock, no par value	$0	$0
Common Shares, par value	0.125	0.125
Common Shares, Authorized	224,000,000	224,000,000
Common Shares, Issued	134,623,528	134,623,528
Common Shares, Outstanding	130,971,470	113,508,990
Common shares in treasury	3,652,058	21,114,538
Class A Preferred stock
Preferred stock, shares authorized	3,000,000	3,000,000
Preferred stock, shares unissued	3,000,000	3,000,000
Class B Preferred stock
Preferred stock, shares authorized	4,000,000	4,000,000
Preferred stock, shares unissued	4,000,000	4,000,000

Statements of Consolidated Oper

Statements of Consolidated Operations (USD $)
In Millions, except Share data in Thousands	12 Months Ended Dec. 31, 2009	12 Months Ended Dec. 31, 2008	12 Months Ended Dec. 31, 2007
REVENUES FROM PRODUCT SALES AND SERVICES
Product	2216.2	3294.8	1997.3
Freight and venture partners' cost reimbursements	125.8	314.3	277.9
Revenues, Total	2,342	3609.1	2275.2
COST OF GOODS SOLD AND OPERATING EXPENSES	-2033.1	-2449.4	-1813.2
SALES MARGIN	308.9	1159.7	462
OTHER OPERATING INCOME (EXPENSE)
Royalties and management fee revenue	4.8	21.7	14.5
Selling, general and administrative expenses	-120.7	-188.6	-114.2
Terminated acquisition costs	0	-90.1	0
Gain on sale of other assets - net	13.2	22.8	18.4
Casualty recoveries	0	10.5	3.2
Miscellaneous - net	24	2.9	-2.3
Operating Expenses	-78.7	-220.8	-80.4
OPERATING INCOME	230.2	938.9	381.6
OTHER INCOME (EXPENSE)
Changes in fair value of foreign currency contracts, net	85.7	-188.2	0
Interest income	10.8	26.2	20
Interest expense	(39)	-39.8	-22.6
Impairment of securities	0	-25.1	0
Other non-operating income	2.9	4.3	1.7
Nonoperating Income (Expense), Total	60.4	-222.6	-0.9
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND EQUITY LOSS FROM VENTURES	290.6	716.3	380.7
INCOME TAX EXPENSE	-20.8	-144.2	-84.1
EQUITY LOSS FROM VENTURES	-65.5	-35.1	-11.2
INCOME FROM CONTINUING OPERATIONS	204.3	537	285.4
INCOME FROM DISCONTINUED OPERATIONS (net of tax of $0.2 in 2007)	0	0	0.2
NET INCOME	204.3	537	285.6
LESS: NET INCOME (LOSS) ATTRIBUTABLE TO NONCONTROLLING INTEREST (net of tax of $0.3, $9.1, and $4.7 in 2009, 2008 and 2007)	-0.8	21.2	15.6
NET INCOME ATTRIBUTABLE TO CLIFFS SHAREHOLDERS	205.1	515.8	270
PREFERRED STOCK DIVIDENDS	0	-1.1	-5.2
INCOME ATTRIBUTABLE TO CLIFFS COMMON SHAREHOLDERS	205.1	514.7	264.8
EARNINGS PER COMMON SHARE ATTRIBUTABLE TO CLIFFS SHAREHOLDERS - BASIC	1.64	5.07	3.19
EARNINGS PER COMMON SHARE ATTRIBUTABLE TO CLIFFS SHAREHOLDERS - DILUTED	1.63	4.76	2.57
AVERAGE NUMBER OF SHARES (IN THOUSANDS)
Basic	124,998	101,471	82,988
Diluted	125,751	108,288	105,026
CASH DIVIDENDS PER SHARE	0.26	0.35	0.25

2_Statements of Consolidated Op

Statements of Consolidated Operations (Parenthetical) (USD $)
In Millions	12 Months Ended Dec. 31, 2009	12 Months Ended Dec. 31, 2008	12 Months Ended Dec. 31, 2007
INCOME FROM DISCONTINUED OPERATIONS, tax	$0	$0	0.2
NET INCOME (LOSS) ATTRIBUTABLE TO NONCONTROLLING INTEREST, tax	0.3	9.1	4.7

Statement Of Cash Flows Indirec

Statement Of Cash Flows Indirect (USD $)
In Millions	12 Months Ended Dec. 31, 2009	12 Months Ended Dec. 31, 2008	12 Months Ended Dec. 31, 2007
OPERATING ACTIVITIES
Net income	204.3	$537	285.6
Income from discontinued operations	0	0	-0.2
Adjustments to reconcile net income to net cash from operating activities:
Depreciation, depletion and amortization	236.6	201.1	107.2
Derivatives and currency hedges	-204.5	58.4	-15.4
Foreign exchange gains	-28.1	0	0
Share-based compensation	10.1	21.4	11.8
Equity loss in ventures (net of tax)	65.5	35.1	11.2
Pensions and other postretirement benefits	27.3	-32.9	-35.4
Deferred income taxes	60.8	-88.5	-33.1
Changes in deferred revenue and below-market sales contracts	-33.4	58	-34.2
Impairment of securities	0	25.1	0
Property damage recoveries	0	-10.5	0
Other	4.6	6.7	(15)
Changes in operating assets and liabilities:
Receivables and other assets	-24.2	-55.4	18
Product inventories	7.7	-44.6	3.2
Payables and accrued expenses	(141)	142.3	-14.8
Net cash from operating activities	185.7	853.2	288.9
INVESTING ACTIVITIES
Purchase of PinnOak	0	0	-343.8
Purchase of noncontrolling interests	0	-589.5	0
Purchase of property, plant and equipment	-116.3	-182.5	-199.5
Investments in ventures	-81.8	-62.7	-180.6
Investment in marketable securities	-14.9	-30.4	-85.3
Redemption of marketable securities	5.4	17.8	40.6
Proceeds from sale of assets	28.3	41.2	23.2
Proceeds from property damage insurance recoveries	0	10.5	0
Net cash used by investing activities	-179.3	-795.6	-745.4
FINANCING ACTIVITIES
Net proceeds from issuance of common shares	347.3	0	0
Borrowings under credit facility	279.7	540	1,195
Repayments under credit facility	-276.4	(780)	(755)
Repayment of PinnOak debt	0	0	-159.6
Borrowings under senior notes	0	325	0
Common stock dividends	-31.9	-36.1	-20.9
Preferred stock dividends	0	-1.1	-5.5
Repayment of other borrowings	-9.7	-8.4	-6.9
Contributions by (to) joint ventures, net	-8.3	-10.5	1.9
Other financing activities	3.6	3.5	1.1
Net cash from financing activities	304.3	32.4	250.1
EFFECT OF EXCHANGE RATE CHANGES ON CASH	13	-68.1	11.8
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	323.7	21.9	-194.6
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR	179	157.1	351.7
CASH AND CASH EQUIVALENTS AT END OF YEAR	502.7	$179	157.1

Statement Of Shareholders Equit

Statement Of Shareholders Equity And Other Comprehensive Income (USD $)
In Millions			Retained Earnings		Accumulated Other Comprehensive Income (Loss)	Non-Controlling Interest	Total
Beginning Balance at Dec. 31, 2006	16.8	103.2	1078.5	-282.8	-169.9	85.8	831.6
Beginning Balance (in shares) at Dec. 31, 2006	81.8
Comprehensive income
Net income			270			15.6	285.6
Other comprehensive income
Pension and OPEB liability					38.8	3.1	41.9
Unrealized net gain (loss) on marketable securities					0.6		0.6
Unrealized net gain (loss) on foreign currency translation					86.9	6.8	93.7
Unrealized gain (loss) on interest rate swap					-0.9		-0.9
Unrealized gain (loss) on derivative instruments					14.2	3.5	17.7
Total comprehensive income						29	438.6
Effect of implementing provisions of ASC 740 related to accounting for income tax uncertainties			-7.7			-1.8	-9.5
Undistributed earnings (losses) to noncontrolling interest						4.8	4.8
Stock options exercised				0.2			0.2
Stock and other incentive plans (in shares)	0.4
Stock and other incentive plans		4.1		2.5			6.6
Repurchases of common stock				-2.2			-2.2
Conversion of preferred stock (in shares)	5
Conversion of preferred stock		9.3	1.6	26.7			37.6
Preferred stock dividends			-5.3				-5.3
Common stock dividends			-20.9				-20.9
Ending Balance (in shares) at Dec. 31, 2007	87.2
Ending Balance at Dec. 31, 2007	16.8	116.6	1316.2	-255.6	-30.3	117.8	1281.5
Comprehensive income
Net income			515.8			21.2	537
Other comprehensive income
Pension and OPEB liability					-188.5	(8)	-196.5
Unrealized net gain (loss) on marketable securities					-10.3	-1.4	-11.7
Unrealized net gain (loss) on foreign currency translation					-165.1	-13.7	-178.8
Unrealized gain (loss) on interest rate swap					-0.8		-0.8
Unrealized gain (loss) on derivative instruments					0.4	0.8	1.2
Total comprehensive income						-1.1	150.4
Equity purchase of noncontrolling interest (in shares)	4.3
Equity purchase of noncontrolling interest		141.8		23.2			165
Purchase of subsidiary shares from noncontrolling interest						-111.2	-111.2
Undistributed earnings (losses) to noncontrolling interest						-2.9	-2.9
Capital contribution by noncontrolling interest to subsidiary						0.7	0.7
PinnOak settlement (in shares)	4
PinnOak settlement		131.5		21.5			153
Stock and other incentive plans		19.2		0.8			20
Conversion of preferred stock (in shares)	18
Conversion of preferred stock		33.1	5.1	96.3			134.5
Preferred stock dividends			-1.1				-1.1
Common stock dividends			-36.1				-36.1
Ending Balance (in shares) at Dec. 31, 2008	113.5						113.5
Ending Balance at Dec. 31, 2008	16.8	442.2	1799.9	-113.8	-394.6	3.3	1753.8
Comprehensive income
Net income			205.1			-0.8	204.3
Other comprehensive income
Pension and OPEB liability					24.2	-2.4	21.8
Unrealized net gain (loss) on marketable securities					29.5		29.5
Unrealized net gain (loss) on foreign currency translation					231.7		231.7
Unrealized gain (loss) on interest rate swap					1.7		1.7
Unrealized gain (loss) on derivative instruments					-15.1		-15.1
Total comprehensive income						-3.2	473.9
Purchase of subsidiary shares from noncontrolling interest						0.1	0.1
Undistributed earnings (losses) to noncontrolling interest						-6.7	-6.7
Capital contribution by noncontrolling interest to subsidiary						0.7	0.7
Issuance of common shares (in shares)	17.3
Issuance of common shares		254.5		92.8			347.3
Purchase of additional noncontrolling interest		-5.4					-5.4
Stock and other incentive plans (in shares)	0.2
Stock and other incentive plans		4.1		0.9			5
Conversion of preferred stock				0.2			0.2
Common stock dividends			-31.9				-31.9
Ending Balance (in shares) at Dec. 31, 2009	131						131
Ending Balance at Dec. 31, 2009	16.8	695.4	1973.1	-19.9	-122.6	-5.8	$2,537

BUSINESS SUMMARY AND SIGNIFICAN

BUSINESS SUMMARY AND SIGNIFICANT ACCOUNTING POLICIES
	12 Months Ended Dec. 31, 2009 USD / shares
BUSINESS SUMMARY AND SIGNIFICANT ACCOUNTING POLICIES	NOTE 1 BUSINESS SUMMARY AND SIGNIFICANT ACCOUNTING POLICIES Business Summary We are an international mining and natural resources company, the largest producer of iron ore pellets in North America, a major supplier of direct-shipping lump and fines iron ore out of Australia, and a significant producer of metallurgical coal. In North America, we operate six iron ore mines in Michigan, Minnesota and Eastern Canada, and two coking coal mining complexes located in West Virginia and Alabama. Our Asia Pacific operations are comprised of two iron ore mining complexes in Western Australia, serving the Asian iron ore markets with direct-shipping fines and lump ore, and a 45 percent economic interest in Sonoma, a coking and thermal coal mine located in Queensland, Australia. In Latin America, we have a 30 percent interest in Amap, a Brazilian iron ore project. Our companys operations are organized and managed according to product category and geographic location: NorthAmerican Iron Ore, North American Coal, Asia Pacific Iron Ore, Asia Pacific Coal and Latin American Iron Ore. Accounting Policies We consider the following policies to be beneficial in understanding the judgments that are involved in the preparation of our consolidated financial statements and the uncertainties that could impact our financial condition, results of operations and cash flows. All common shares and per share amounts have been adjusted retroactively to reflect the two-for-one stock split effective May15, 2008. Use of Estimates The preparation of financial statements, in conformity with GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from estimates. On an ongoing basis, management reviews estimates. Changes in facts and circumstances may alter such estimates and affect results of operations and financial position in future periods. Basis of Consolidation The consolidated financial statements include our accounts and the accounts of our wholly-owned and majority-owned subsidiaries, including the following significant subsidiaries: Name Location OwnershipInterest Operation Northshore Minnesota 100.0 % IronOre United Taconite Minnesota 100.0 % Iron Ore Pinnacle WestVirginia 100.0 % Coal Oak Grove Alabama 100.0 % Coal Asia Pacific Iron Ore Western Australia 100.0 % Iron Ore Tilden Michigan 85.0 % Iron Ore Empire Michigan 79.0 % Iron Ore Intercompany transactions and balances are eliminated upon consolidation. We previously adopted, effective January1, 2009, the amended provisions of FASB ASC 810 related to noncontrolling interests in consolidated financial statements, which established accounting and reporting standards for the noncontrolling interest in a subsidiary and for the deconsolidation of a subsidiary. The amendment clarifies that a noncontrolling interest in a s

SEGMENT REPORTING

SEGMENT REPORTING
	12 Months Ended Dec. 31, 2009 USD / shares
SEGMENT REPORTING	NOTE 2 SEGMENT REPORTING Our companys operations are organized and managed according to product category and geographic location: North American Iron Ore, North American Coal, Asia Pacific Iron Ore, Asia Pacific Coal and Latin American Iron Ore. The North American Iron Ore segment is comprised of our interests in six North American mines that provide iron ore to the integrated steel industry. The North American Coal segment is comprised of our two North American coking coal mining complexes that provide metallurgical coal primarily to the integrated steel industry. The Asia Pacific Iron Ore segment is located in Western Australia and provides iron ore to steel producers in China and Japan. There are no intersegment revenues. The Asia Pacific Coal operating segment is comprised of our 45 percent economic interest in Sonoma, located in Queensland, Australia. The Latin American Iron Ore operating segment is comprised of our 30 percent Amap interest in Brazil, which is in the early stages of production. The Asia Pacific Coal and Latin American Iron Ore operating segments do not meet reportable segment disclosure requirements and therefore are not separately reported. We evaluate segment performance based on sales margin, defined as revenues less cost of goods sold and operating expenses identifiable to each segment. This measure of operating performance is an effective measurement as we focus on reducing production costs throughout the Company. The following table presents a summary of our reportable segments for the years ended December31, 2009, 2008 and 2007, including a reconciliation of segment sales margin to income from continuing operations before income taxes and equity loss from ventures: (In Millions) 2009 2008 2007 Revenues from product sales and services: North American Iron Ore $ 1,447.8 62 % $ 2,369.6 66 % $ 1,745.4 77 % North American Coal 207.2 9 % 346.3 10 % 85.2 4 % Asia Pacific Iron Ore 542.1 23 % 769.8 21 % 444.6 19 % Other 144.9 6 % 123.4 3 % 0 % Total revenues from product sales and services for reportable segments $ 2,342.0 100 % $ 3,609.1 100 % $ 2,275.2 100 % Sales margin: North American Iron Ore $ 275.5 $ 804.3 $ 397.9 North American Coal (71.9 ) (46.4 ) (31.7 ) Asia Pacific Iron Ore 87.2 348.6 95.8 Other 18.1 53.2 Sales margin 308.9 1,159.7 462.0 Other operating expense (78.7 ) (220.8 ) (80.4 ) Other income (expense) 60.4 (222.6 ) (0.9 ) Income from continuing operations before income taxes and equity loss from ventures $ 290.6 $ 716.3 $ 380.7

DERIVATIVE INSTRUMENTS AND HEDG

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES
	12 Months Ended Dec. 31, 2009 USD / shares
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES	NOTE 3 DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES The following table presents the fair value of our derivative instruments and the classification of each on the Statements of Consolidated Financial Position as of December31, 2009 and 2008: (In Millions) Derivative Assets Derivative Liabilities December 31, 2009 December 31, 2008 December 31, 2009 December 31, 2008 Derivative Instrument Balance Sheet Location Fair Value Balance Sheet Location Fair Value Balance Sheet Location Fair Value Balance Sheet Location Fair Value Derivatives designated as hedging instruments under ASC 815: Interest Rate Swap $ $ Derivativeliabilities (current) $ Derivativeliabilities (current) $ 2.6 Total derivatives designated as hedging instruments under ASC 815 $ $ $ $ 2.6 Derivatives not designated as hedging instruments under ASC 815: Foreign Exchange Contracts Derivativeassets (current) $ 4.2 Derivativeassets (current) $ 0.3 Derivative liabilities (current) $ Derivative liabilities (current) $ 77.5 Deposits and miscellaneous Deposits and miscellaneous 0.6 Derivative liabilities (long-term) Derivative liabilities (long-term) 34.3 Customer Supply Agreements Derivative assets (current) 47.3 Derivative assets (current) 76.6 Deposits and miscellaneous 15.9 Deposits and miscellaneous Benchmark Pricing Provision Derivative liabilities (current) Derivative liabilities (current) 7.7 United Taconite Purchase Provision Derivative liabilities (current) Derivative liabilities (current) 106.5 Total derivatives not designated as hedging instruments under ASC 815 $ 67.4 $ 77.5 $ $ 226.0 Total derivatives $ 67.4 $ 77.5 $ $ 228.6 Derivatives Designated as Hedging Instruments Cash Flow Hedges Effective October19, 2007, we entered into a $100 million fixed interest rate swap to convert a portion of our floating rate debt to fixed rate debt. Interest on borrowings under our credit facility is based on a floating rate, dependent in part on the LIBOR rate, exposing us to the effects of interest rate changes. The objective of the hedge was to eliminate the variability of cash flows in interest payments for forecasted floating rate debt, attributable to changes in benchmark LIBOR interest rates. With the swap agreement, we paid a fixed three-month LIBOR rate for $100 million of our floating rate borrowings. The changes in the cash flows of the interest rate swap were expected to offset the changes in the cash flows attributable to fluctuations in benchmark LIBOR interest rates for forecasted floating rate debt. The interest rate swap terminated in October 2

MARKETABLE SECURITIES

MARKETABLE SECURITIES
	12 Months Ended Dec. 31, 2009 USD / shares
MARKETABLE SECURITIES	NOTE 4 MARKETABLE SECURITIES At December31, 2009 and 2008, we had $99.3 million and $30.2 million, respectively, of marketable securities as follows: (In Millions) December31, 2009 2008 Held to maturity current $ 11.2 $ 4.8 Held to maturity non-current 7.1 14.2 18.3 19.0 Available for sale non-current 81.0 11.2 Total $ 99.3 $ 30.2 Marketable securities classified as held-to-maturity are measured and stated at amortized cost. The amortized cost, gross unrealized gains and losses and fair value of investment securities held-to-maturity at December31, 2009 and 2008 are summarized as follows: December31, 2009 (In Millions) Amortized Cost GrossUnrealized Fair Value Gains Losses Asset backed securities $ 2.7 $ $ (1.2 ) $ 1.5 Floating rate notes 15.6 (0.2 ) 15.4 Total $ 18.3 $ $ (1.4 ) $ 16.9 December31, 2008 (In Millions) Amortized Cost GrossUnrealized Fair Value Gains Losses Asset backed securities $ 2.1 $ $ (0.6 ) $ 1.5 Floating rate notes 16.9 (1.1 ) 15.8 Total $ 19.0 $ $ (1.7 ) $ 17.3 Investment securities held-to-maturity at December31, 2009 and 2008 have contractual maturities as follows: (In Millions) December 31, 2009 2008 Asset backed securities: Within 1 year $ $ 1 to 5 years 2.7 2.1 $ 2.7 $ 2.1 Floating rate notes: Within 1 year $ 11.2 $ 4.8 1 to 5 years 4.4 12.1 $ 15.6 $ 16.9 The following table shows our gross unrealized losses and fair value of securities classified as held-to-maturity, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at December31, 2009 and 2008: Less than 12 months (In Millions) December 31, 2009 December 31, 2008 Unrealized Losses Fair Value Unrealized Losses Fair Value Asset backed securities $ $ $ $ Floating rate notes (0.1 ) 1.7 $ $ $ (0.1 ) $ 1.7 12 months or longer (In Millions) December 31, 2009 December 31, 2008 Unrealized Losses Fair Value Unrealized Losses Fair Value Asset backed securities $ (1.2 ) $ 1.5 $ (0.6 ) $ 1.5 Floating rate notes (0.2 ) 13.2 (1.0 ) 14.1 $ (1.4 ) $ 14.7 $ (1.6 ) $ 15.6 We believe that the unrealized losses on the held-to-maturity portfolio at December31, 2009 are temporary and are related to market interest rate fluctuations and not to deteriorat

ACQUISITIONS AND OTHER INVESTME

ACQUISITIONS AND OTHER INVESTMENTS
	12 Months Ended Dec. 31, 2009 USD / shares
ACQUISITIONS AND OTHER INVESTMENTS	NOTE 5 ACQUISITIONS AND OTHER INVESTMENTS Acquisitions We allocate the cost of acquisitions to the assets acquired and liabilities assumed based on their estimated fair values. Any excess of cost over the fair value of the net assets acquired is recorded as goodwill. There were no new acquisitions that closed in 2009; however, as discussed in further detail below, we finalized the purchase price allocation for two prior year acquisitions during the current year and announced two new acquisitions that closed in 2010. United Taconite Effective July1, 2008, we acquired the remaining 30 percent interest in United Taconite. Upon consummation of the purchase, our ownership interest increased from 70 percent to 100 percent. The acquisition of the remaining noncontrolling interest was completed in order to strengthen our core North American Iron Ore business. The aggregate acquisition price for the remaining interest in United Taconite was approximately $450.7 million, which included cash in the amount of $104.4 million, approximately $165 million of our common shares, and approximately 1.2million tons of iron ore pellets, valued at $181.3 million, to be provided throughout 2008 and 2009. The value of the iron ore pellets was determined based on estimated iron unit content of 65 percent at the 2008 Eastern Canadian pellet price of approximately $2.33 per iron unit on July10, 2008. The Statements of Consolidated Financial Position as of December31, 2009 and 2008 reflect the acquisition of the remaining interest in United Taconite, effective July1, 2008, under the purchase method of accounting. The transaction constituted a step acquisition of a noncontrolling interest. As of the date of the step acquisition of the noncontrolling interest, the then historical cost basis of the noncontrolling interest balance was eliminated, and the increased ownership obtained was accounted for by increasing United Taconites basis from historical cost to fair value for the portion of the assets acquired and liabilities assumed based on the 30 percent additional ownership acquired. We finalized the purchase price allocation in the second quarter of 2009 as follows: (InMillions) Carrying value of net assets acquired $ 25.3 Fair value adjustments: ASSETS Land 7.6 Plant and equipment 90.8 Mineral reserves 480.6 Intangible assets 75.4 LIABILITIES Below market sales contracts (229.0 ) Fair value of net assets acquired $ 450.7 Purchase price $ 450.7 There were no significant changes to the purchase price allocation from the initial allocation performed in 2008. Portman Share Repurchase and Buyout In 2008, we acquired the remaining noncontrolling interest in Asia Pacific Iron Ore (formerly known as Portman Limited) through a series of step acquisitions. In the second quarter of 2008, our ownership interest increased from 80.4 percent to 85.2 percent as a result of a share repurchase in which we did not participate. In the fourth quarter of 2008, we completed a second step acquisition to acquire the re

FINANCIAL INFORMATION OF EQUITY

FINANCIAL INFORMATION OF EQUITY AFFILIATES
	12 Months Ended Dec. 31, 2009 USD / shares
FINANCIAL INFORMATION OF EQUITY AFFILIATES	NOTE 6 FINANCIAL INFORMATION OF EQUITY AFFILIATES For the year ended December31, 2009, our investment in Amap qualifies as a significant equity method investment as defined under Regulation S-X. Summarized financial information for Amap and our other equity method investments as of December31, 2009 and 2008 and for the years ended December31, 2009, 2008 and 2007 is as follows: Amap (1) (In Millions) (In Millions) December 31, Year Ended December 31, Balance Sheet Information 2009 2008 Income Statement Information 2009 2008 2007 Current assets $ 124.5 $ 75.6 Revenues $ 123.0 $ 52.2 $ 1.3 Non-current assets 616.6 565.5 Sales margin (46.8 ) (46.0 ) (26.6 ) Current liabilities (632.8 ) (276.1 ) Loss from continuing operations before extraordinary items and cumulative effect of a change in accounting (195.2 ) (111.0 ) (34.4 ) Non-current liabilities (4.8 ) (289.9 ) Net loss (195.2 ) (111.0 ) (34.4 ) (1) The financial information of Amap is recorded one month in arrears and is presented in accordance with U.S. GAAP. The information presented in the table represents 100% of Amaps results. Other Equity Method Investments (2) (In Millions) (In Millions) December31, Year Ended December 31, (3) Balance Sheet Information 2009 2008 Income Statement Information 2009 2008 2007 Current assets $ 133.0 $ 175.6 Revenues $ 450.7 $ 810.3 $ 714.9 Non-current assets 1,006.3 944.7 Sales margin (0.1 ) 43.0 41.8 Current liabilities (130.0 ) (125.3 ) Income(Loss)from continuing operations before extraordinary items and cumulative effect of a change in accounting (15.0 ) 35.2 41.1 Non-current liabilities (275.3 ) (285.5 ) Net income (loss) (15.0 ) 35.2 41.1 (2) Other equity method investments include Wabush, Hibbing, Cockatoo, AusQuest (acquired in November 2008) and KWG (acquired in April 2009). The financial information of each equity method investment is presented in accordance with U.S. GAAP. The information presented in the table represents 100% of the investees results on an aggregated basis. (3) Wabush and Hibbing function as a captive cost companies, as they supply products only to their owners effectively on a cost basis. Accordingly, revenue amounts are stated at cost of production and are offset entirely by an equal amount included in cost of goods sold, resulting in no sales margin. Refer to NOTE 1 BUSINESS SUMMARY AND SIGNIFICANT ACCOUNTING POLICIES for additional information.

GOODWILL AND OTHER INTANGIBLE A

GOODWILL AND OTHER INTANGIBLE ASSETS AND LIABILITIES
	12 Months Ended Dec. 31, 2009 USD / shares
GOODWILL AND OTHER INTANGIBLE ASSETS AND LIABILITIES	NOTE 7 GOODWILL AND OTHER INTANGIBLE ASSETS AND LIABILITIES Goodwill The following table summarizes changes in the carrying amount of goodwill allocated by reporting unit during 2009 and 2008: (In Millions) December 31, 2009 December31,2008 NorthAmerican Iron Ore AsiaPacific Iron Ore Total North American Iron Ore Beginning Balance January 1 $ 2.0 $ $ 2.0 $ 2.0 Arising in business combinations 68.3 68.3 Impact of foreign currency translation 4.3 4.3 Ending Balance December 31 $ 2.0 $ 72.6 $ 74.6 $ 2.0 We had goodwill of $2.0 million as of December31, 2008 related to our North American Iron Ore segment, which was previously reported as a non-current asset within Deposits and miscellaneous on the Statements of Consolidated Financial Position. Goodwill increased in 2009 based on finalization of the purchase price allocation related to the Asia Pacific Iron Ore share repurchase and buyout. The balance of $74.6 million and $2.0 million at December31, 2009 and 2008, respectively, is presented as Goodwill on the Statements of Consolidated Financial Position. Refer to NOTE 5 ACQUISITIONS AND OTHER INVESTMENTS for additional information. Goodwill is not subject to amortization and is tested for impairment annually or when events or circumstances indicate that impairment may have occurred. Other Intangible Assets and Liabilities Following is a summary of intangible assets and liabilities at December31, 2009 and 2008: (In Millions) December 31, 2009 December 31, 2008 Classification Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Definite lived intangible assets: Permits Intangibleassets $ 120.3 $ (8.2) $ 112.1 $ 109.3 $ (1.8) $ 107.5 Leases Intangible assets 3.1 (2.8) 0.3 3.1 (1.0) 2.1 Unpatented technology Intangible assets 4.0 (1.6) 2.4 Total intangible assets $ 127.4 $ (12.6) $ 114.8 $ 112.4 $ (2.8) $ 109.6 Below-market sales contracts Currentliabilities $ (30.3) $ $ (30.3) $ (30.3) $ $ (30.3) Below-market sales contracts Long-termliabilities (198.7) 45.4 (153.3) (198.7) 15.1 (183.6) Total below-market sales contracts $ (229.0) $ 45.4 $ (183.6) $ (229.0) $ 15.1 $ (213.9) The intangible assets are subject to periodic amortization on a straight-line basis over their estimated useful lives as follows: Intangible Asset UsefulLife(years) Permits 15-28 Leases 1.5-4.5 Unpatented technology 5 Amortization expense relating to intangible assets was $9.8 million and $2.8 million, respectively, for the

FAIR VALUE OF FINANCIAL INSTRUM

FAIR VALUE OF FINANCIAL INSTRUMENTS
	12 Months Ended Dec. 31, 2009 USD / shares
FAIR VALUE OF FINANCIAL INSTRUMENTS	NOTE 8 FAIR VALUE OF FINANCIAL INSTRUMENTS The following represents the assets and liabilities of the Company measured at fair value at December31, 2009 and 2008: (In Millions) December31, 2009 Description QuotedPricesin Active MarketsforIdentical Assets/Liabilities (Level 1) SignificantOther Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Assets: Cash equivalents $ 376.0 $ $ $ 376.0 Derivative assets 63.2 63.2 Marketable securities 81.0 81.0 Foreign exchange contracts 4.2 4.2 Total $ 457.0 $ 4.2 $ 63.2 $ 524.4 We had no financial instruments measured at fair value that were in a liability position at December31, 2009. (In Millions) December 31, 2008 Description QuotedPricesinActive Markets for Identical Assets/Liabilities (Level 1) SignificantOther Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Assets: Cash equivalents $ 40.4 $ $ $ 40.4 Derivative assets 76.6 76.6 Marketable securities 10.9 0.3 11.2 Foreign exchange contracts 0.9 0.9 Total $ 51.3 $ 1.2 $ 76.6 $ 129.1 Liabilities: Interest rate swap $ $ 2.6 $ $ 2.6 Foreign exchange contracts 111.8 111.8 Derivative liabilities 114.2 114.2 Total $ $ 114.4 $ 114.2 $ 228.6 Financial assets classified in Level 1 at December31, 2009 and 2008 include money market funds and available-for-sale marketable securities. The valuation of these instruments is determined using a market approach, taking into account current interest rates, creditworthiness, and liquidity risks in relation to current market conditions, and is based upon unadjusted quoted prices for identical assets in active markets. The valuation of financial assets and liabilities classified in Level 2 is determined using a market approach based upon quoted prices for similar assets and liabilities in active markets, or other inputs that are observable for substantially the full term of the financial instrument. Level 2 securities primarily include derivative financial instruments valued using financial models that use as their basis readily observable market parameters. At December31, 2009 and 2008, such derivative financial instruments include substantially all of our foreign exchange hedge contracts. As of December31, 2008, such derivative instruments also included our interest rate swap agreement, which terminated in October 2009. The fair value of the interest rate swap and foreign exchange hedge contracts is based on a forward LIBOR curve and forward market prices, respectively, and represents the estimated amount we would receive or pay to terminate these agreements at the reporting date, tak

DEBT AND CREDIT FACILITIES

DEBT AND CREDIT FACILITIES
	12 Months Ended Dec. 31, 2009 USD / shares
DEBT AND CREDIT FACILITIES	NOTE 9 DEBT AND CREDIT FACILITIES The following represents a summary of our long-term debt as of December31, 2009 and 2008: ($ in Millions) December31, 2009 Debt Instrument Type Average Annual InterestRate Final Maturity Total Borrowing Capacity Total Principal Outstanding Private Placement Senior Notes: Series 2008A Tranche A Fixed 6.31 % 2013 $ 270.0 $ (270.0 ) Series 2008A Tranche B Fixed 6.59 % 2015 55.0 (55.0 ) Credit Facility: Term loan Variable 1.43 %(1) 2012 200.0 (200.0 ) Revolving loan Variable %(1) 2012 600.0 (2) Total $ 1,125.0 $ (525.0 ) December31, 2008 Debt Instrument Type Average Annual Interest Rate Final Maturity Total Borrowing Capacity Total Principal Outstanding Private Placement Senior Notes: Series 2008A Tranche A Fixed 6.31 % 2013 $ 270.0 $ (270.0 ) Series 2008A Tranche B Fixed 6.59 % 2015 55.0 (55.0 ) Credit Facility: Term loan Variable 5.02 %(1) 2012 200.0 (200.0 ) Revolving loan Variable %(1) 2012 600.0 (2) Total $ 1,125.0 $ (525.0 ) (1) After the effect of interest rate hedging, the average annual borrowing rate for outstanding revolving and term loans was 1.43% and 5.10% as of December31, 2009 and 2008, respectively. (2) As of December31, 2009 and 2008, no revolving loans were drawn under the credit facility; however, the principal amount of letter of credit obligations totaled $31.4 million and $21.5 million, respectively, reducing available borrowing capacity to $568.6 million and $578.5 million, respectively. Private Placement Senior Notes On June25, 2008, we entered into a $325 million private placement consisting of $270 million of 6.31 percent Five-Year Senior Notes due June15, 2013, and $55 million of 6.59 percent Seven-Year Senior Notes due June15, 2015. Interest is paid on the notes for both tranches on June15 and December15 until their respective maturities. The notes are unsecured obligations with interest and principal amounts guaranteed by certain of our domestic subsidiaries. The notes and guarantees were not required to be registered under the Securities Act of 1933, as amended, and were placed with qualified institutional investors. We used the proceeds to repay senior unsecured indebtedness and for general corporate purposes. The terms of the private placement senior notes contain customary covenants that require compliance with certain financial covenants based on: (1)debt to earnings ratio (Total Funded Debt to Consolidated EBITDA, as those terms are defined in the agreement, for the preceding four quarters cannot exceed 3.25 to 1.0 on the last day of any fiscal quarter) and (2)interest coverage ratio (Consolidated EBITDA to Interest Expense, as those terms are defined in the agreemen

LEASE OBLIGATIONS

LEASE OBLIGATIONS
	12 Months Ended Dec. 31, 2009 USD / shares
LEASE OBLIGATIONS	NOTE 10 LEASE OBLIGATIONS We lease certain mining, production and other equipment under operating and capital leases. The leases are for varying lengths, generally at market interest rates and contain purchase and/or renewal options at the end of the terms. Our operating lease expense was $25.5 million, $20.8 million and $14.7 million in 2009, 2008 and 2007, respectively. Capital lease assets were $167.1 million and $73.9 million at December31, 2009 and 2008, respectively. Corresponding accumulated amortization of capital leases included in respective allowances for depreciation were $41.5 million and $18.3 million at December31, 2009 and 2008, respectively. In January 2009, Asia Pacific Iron Ore entered into a sale-leaseback arrangement. Under the arrangement, we sold 420 rail cars and leased them back for a period of 10 years. The leaseback has been accounted for as a capital lease. We recorded assets and liabilities under the capital lease of $42.7 million, reflecting the lower of the present value of the minimum lease payments or the fair value of the asset. No material gain or loss was realized as a result of the transaction. Future minimum payments under capital leases and non-cancellable operating leases at December31, 2009 are as follows: (In Millions) Capital Leases Operating Leases 2010 $ 24.3 $ 22.4 2011 23.8 18.6 2012 23.4 14.7 2013 22.1 15.4 2014 21.6 11.0 2015 and thereafter 68.0 12.2 Total minimum lease payments 183.2 $ 94.3 Amounts representing interest 49.7 Present value of net minimum lease payments $ 133.5 (1) (1) The total is comprised of $14.2 million and $119.3 million classified as Other current liabilities and Other liabilities, respectively, on the Statements of Consolidated Financial Position at December31, 2009. Total minimum capital lease payments of $183.2 million include $16.3 million and $166.9 million, for our North American Iron Ore segment and Asia Pacific Iron Ore segment, respectively. Total minimum operating lease payments of $94.3 million include $84.4 million for our North American Iron Ore segment, $6.1 million for our Asia Pacific Iron Ore segment, and $3.8 million for our North American Coal segment.

ENVIRONMENTAL AND MINE CLOSURE

ENVIRONMENTAL AND MINE CLOSURE OBLIGATIONS
	12 Months Ended Dec. 31, 2009 USD / shares
ENVIRONMENTAL AND MINE CLOSURE OBLIGATIONS	NOTE 11 ENVIRONMENTAL AND MINE CLOSURE OBLIGATIONS We had environmental and mine closure liabilities of $132.3 million and $117.1 million at December31, 2009 and 2008, respectively. Payments in 2009 were $1.6 million compared with $6.2 million in 2008. The following is a summary of the obligations at December31, 2009 and 2008: (In Millions) December31, 2009 2008 Environmental $ 14.5 $ 16.4 Mine closure LTVSMC 13.9 13.9 Operating mines: North American Iron Ore 56.9 44.1 North American Coal 30.3 31.1 Asia Pacific Iron Ore 11.4 7.8 Other 5.3 3.8 Total mine closure 117.8 100.7 Total environmental and mine closure obligations 132.3 117.1 Less current portion 8.0 12.2 Long term environmental and mine closure obligations $ 124.3 $ 104.9 Environmental Our mining and exploration activities are subject to various laws and regulations governing the protection of the environment. We conduct our operations to protect the public health and environment and believe our operations are in compliance with applicable laws and regulations in all material respects. Our environmental liabilities of $14.5 million and $16.4 million at December31, 2009 and 2008, respectively, including obligations for known environmental remediation exposures at various active and closed mining operations and other sites, have been recognized based on the estimated cost of investigation and remediation at each site. If the cost can only be estimated as a range of possible amounts with no specific amount being more likely, the minimum of the range is accrued. Future expenditures are not discounted unless the amount and timing of the cash disbursements are readily known. Potential insurance recoveries have not been reflected. Additional environmental obligations could be incurred, the extent of which cannot be assessed. As discussed in further detail below, the environmental liability recorded at December31, 2009 and 2008 is primarily comprised of remediation obligations related to the Rio Tinto mine site in Nevada where we are named as a PRP. The Rio Tinto Mine Site The Rio Tinto Mine Site is a historic underground copper mine located near Mountain City, Nevada, where tailings were placed in Mill Creek, a tributary to the Owyhee River. Site investigation and remediation work is being conducted in accordance with a Consent Order between the Nevada DEP and the RTWG composed of Cliffs, Atlantic Richfield Company, Teck Cominco American Incorporated, and E. I. du Pont de Nemours and Company. The Consent Order provides for technical review by the U.S. Department of the Interior Bureau of Indian Affairs, the U.S. Fish Wildlife Service, U.S. Department of Agriculture Forest Service, the NDEP and the Shoshone-Paiute Tribes of the Duck Valley Reservation (collectively, Rio Tinto Trustees). The Consent Order is currently projected to continue with the objective of supporting the selection of the final remedy for the site. Costs are shared pursuant

PENSIONS AND OTHER POSTRETIREME

PENSIONS AND OTHER POSTRETIREMENT BENEFITS
	12 Months Ended Dec. 31, 2009 USD / shares
PENSIONS AND OTHER POSTRETIREMENT BENEFITS	NOTE 12 PENSIONS AND OTHER POSTRETIREMENT BENEFITS We offer defined benefit pension plans, defined contribution pension plans and other postretirement benefit plans, primarily consisting of retiree healthcare benefits, to most employees in North America as part of a total compensation and benefits program. This includes employees of PinnOak, who became employees of the Company through the July 2007 acquisition. We do not have employee retirement benefit obligations at our Asia Pacific Iron Ore operations. The defined benefit pension plans are largely noncontributory and benefits are generally based on employees years of service and average earnings for a defined period prior to retirement or a minimum formula. On October6, 2008, the USW ratified a four-year labor contract, which replaced the labor agreement that expired on September1, 2008. The agreement covers approximately 2,300 USW-represented workers at our Empire and Tilden mines in Michigan, and our United Taconite and Hibbing mines in Minnesota. The changes enhanced the minimum pension formula by increasing the benefit dollar multipliers and renewed the lump sum special payments for certain employees retiring in the near future. The changes also included renewal of payments to surviving spouses of certain retirees. In addition, we currently provide various levels of retirement health care and OPEB to most full-time employees who meet certain length of service and age requirements (a portion of which are pursuant to collective bargaining agreements). Most plans require retiree contributions and have deductibles, co-pay requirements, and benefit limits. Most bargaining unit plans require retiree contributions and co-pays for major medical and prescription drug coverage. There is an annual limit on our cost for medical coverage under the U.S. salaried plans. The annual limit applies to each covered participant and equals $7,000 for coverage prior to age 65 and $3,000 for coverage after age 65, with the retirees participation adjusted based on the age at which retirees benefits commence. For participants at our Northshore operation, the annual limit ranges from $4,020 to $4,500 for coverage prior to age 65, and equals $2,000 for coverage after age 65. Covered participants pay an amount for coverage equal to the excess of (i)the average cost of coverage for all covered participants, over (ii)the participants individual limit, but in no event will the participants cost be less than 15 percent of the average cost of coverage for all covered participants. For Northshore participants, the minimum participant cost is a fixed dollar amount. We do not provide OPEB for most U.S. salaried employees hired after January1, 1993. OPEB are provided through programs administered by insurance companies whose charges are based on benefits paid. Our North American Coal segment is required under an agreement with the UMWA to pay amounts into the UMWA pension trusts based principally on hours worked by UMWA-represented employees. These multi- employer pension trusts provide benefits to eligible retirees through a defined benefit plan. The UMWA 1993 Benefit Plan is a defined contribution plan t

STOCK COMPENSATION PLANS

STOCK COMPENSATION PLANS
	12 Months Ended Dec. 31, 2009 USD / shares
STOCK COMPENSATION PLANS	NOTE 13 STOCK COMPENSATION PLANS At December31, 2009, we have two share-based compensation plans, which are described below. The compensation cost that has been charged against income for those plans was $12.2 million, $22.5 million, and $12.4 million in 2009, 2008 and 2007, respectively, which was recorded primarily in Selling, general and administrative expenses on the Statements of Consolidated Operations. The total income tax benefit recognized in the Statements of Consolidated Operations for share-based compensation arrangements was $4.3 million, $7.9 million and $4.3 million for 2009, 2008 and 2007, respectively. Cash flows resulting from the tax benefits for tax deductions in excess of the compensation expense are classified as financing cash flows. Accordingly, we classified $3.5 million, $3.5 million and $4.3 million in excess tax benefits as cash from financing activities rather than cash from operating activities on our Statements of Consolidated Cash Flows for the years ended December31, 2009, 2008 and 2007, respectively. Employees Plans The Companys 2007 ICE Plan (Plan) authorizes up to 4,000,000 of our common shares to be issued as stock options, SARs, restricted shares, restricted share units, retention units, deferred shares, and performance shares or performance units. Any of the foregoing awards may be made subject to attainment of performance goals over a performance period of one or more years. Each stock option and SAR will reduce the common shares available under the 2007 ICE Plan by one common share. Each other award will reduce the common shares available under the 2007 ICE Plan by two common shares. No participant in any fiscal year can be granted in the aggregate of a number of Shares having a Fair Market Value on the Date of Grant equal to more than $5 million. The performance shares are intended to meet the requirements of Internal Revenue code section 162(m) for deduction while the retention units are not. For the outstanding plan year agreements, each performance share, if earned, entitles the holder to receive a number of common shares within the range between a threshold and maximum number of shares, with the actual number of common shares earned dependent upon whether the Company achieves certain objectives and performance goals as established by the Committee. The restricted share units are subject to continued employment, are retention based, will vest at the end of the performance period for the performance shares, and are payable in cash for the 2007 plan year and shares for the 2008 and 2009 plan years at a time determined by the Committee at its discretion. The performance share grants vest over a period of three years. For the 2007 plan year agreement, performance is measured on the basis of relative TSR for the period, as measured against a predetermined peer group of mining and metals companies, three-year cumulative free cash flow and/or pre-tax RONA. Awards are intended to be paid out in common shares. The final payout for all three plan year agreements vary from zero to 150 percent of the performance shares awarded. Upon the occurrence of a change in control, all performance s

INCOME TAXES

INCOME TAXES
	12 Months Ended Dec. 31, 2009 USD / shares
INCOME TAXES	NOTE 14 INCOME TAXES Income from continuing operations before income taxes and equity loss from ventures includes the following components: (In Millions) 2009 2008 2007 United States $ 130.7 $ 566.6 $ 312.3 Foreign 159.9 149.7 68.4 $ 290.6 $ 716.3 $ 380.7 The components of the provision (benefit) for income taxes on continuing operations consist of the following: (In Millions) 2009 2008 2007 Current provision (benefit): United States federal $ (46.2 ) $ 151.4 $ 67.7 United States state local 3.4 3.7 1.0 Foreign 2.8 77.6 48.5 (40.0 ) 232.7 117.2 Deferred provision (benefit): United States federal 13.2 (54.1 ) (12.7 ) United States state local (6.1 ) (4.1 ) (2.9 ) Foreign 53.7 (30.3 ) (17.5 ) 60.8 (88.5 ) (33.1 ) Total provision on continuing operations $ 20.8 $ 144.2 $ 84.1 Reconciliation of our income tax attributable to continuing operations computed at the United States federal statutory rate is as follows: (In Millions) 2009 2008 2007 Tax at U.S. statutory rate of 35 percent $ 101.7 $ 250.6 $ 133.3 Increase (decrease) due to: Percentage depletion in excess of cost depletion (66.2 ) (101.1 ) (46.9 ) Tax effect of foreign operations (44.3 ) (6.5 ) (6.6 ) State taxes, net (2.1 ) (0.7 ) (2.4 ) Manufacturers deduction (0.1 ) (6.9 ) (4.3 ) Valuation allowance 39.0 (0.8 ) 13.0 Other items net (7.2 ) 9.6 (2.0 ) Income tax expense $ 20.8 $ 144.2 $ 84.1 We had a $39.0 million increase in the valuation allowance of certain deferred tax assets. Of this amount, $24.5 million relates to certain foreign operating losses and $14.5 million relates to certain foreign assets where tax basis exceeds book basis. The components of income taxes for other than continuing operations consisted of the following: (In Millions) 2009 2008 2007 Discontinued operations $ $ $ 0.2 Other comprehensive (income) loss: Minimum pension/OPEB liability (4.7 ) (99.8 ) 20.1 Mark-to-market adjustments (12.3 ) (1.4 ) 7.1 (17.0 ) (101.2 ) 27.2 Paid in capital stock based compensation 3.5 (3.5 ) (4.3 ) Significant components of our deferred tax assets and liabilities as of December31, 2009 and 2008 are as follows: (In Millions) 2009 2008 Deferred tax assets: Pensions $ 114.7 $ 114.8 Postretirement benefits other than pensions 7

CAPITAL STOCK

CAPITAL STOCK
	12 Months Ended Dec. 31, 2009 USD / shares
CAPITAL STOCK	NOTE 15CAPITAL STOCK Common Shares Public Offering On May19, 2009, we completed a public offering of our common shares. The total number of shares sold was 17.25million, comprised of a 15million share offering and the exercise of an underwriters over-allotment option to purchase an additional 2.25million common shares. The common shares sold were out of treasury stock, and the sale did not result in an increase in the number of shares authorized or the number of shares issued. A registration statement relating to these securities was filed with and declared effective by the SEC. Net proceeds at a price of $21.00 per share were approximately $348 million. Dividends On May12, 2009, our board of directors enacted a 55 percent reduction in our quarterly common share dividend to $0.04 from $0.0875 for the second and third quarters of 2009 in order to enhance financial flexibility. The $0.04 common share dividends were paid on June1, 2009 and September1, 2009 to shareholders of record as of May22, 2009 and August14, 2009, respectively. In the fourth quarter of 2009, the dividend was reinstated to its previous level. Euronext Listing In March 2009, we listed our common shares on the Professional Compartment of NYSE Euronext Paris (Euronext). On March31, 2009, the French Autorit des marchs financiers (AMF) approved the prospectus and correspondingly granted a visa number for admission of our common shares to listing and trading on Euronext. Our shares began trading on Euronext on April6, 2009 under the symbol CLF and are denominated in Euros on the Paris venue. The cross listing does not result in changes to our capital structure, share count, or current stock-listings and is intended to promote additional liquidity for investors as well as provide greater access to our shares in Euro-zone markets and currencies. Preferred Stock In January 2004, we completed an offering of $172.5 million of redeemable cumulative convertible perpetual preferred stock, without par value, issued at $1,000 per share. The preferred stock paid quarterly cash dividends at a rate of 3.25 percent per annum, had a liquidation preference of $1,000 per share and was convertible into our common shares at an adjusted rate of 133.0646 common shares per share of preferred stock. The preferred stock is classified for accounting purposes as temporary equity reflecting certain provisions of the agreement that could, under remote circumstances (the delisting of our common stock on a U.S. national securities exchange or quotation thereof in an inter-dealer quotation system of any registered U.S. national securities association), require us to redeem the preferred stock for cash. If we were in a default in the payment of six quarterly dividends on the preferred stock, the holders of the preferred stock would thereafter be entitled to elect two directors until all accrued and unpaid dividends were paid. On January13, 2009, we announced that the trading price condition for the conversion right of our 3.25 percent redeemable cumulative convertible perpetual preferred stock had been satisfied and, as a result, holders could surrender their shares for convers

ACCUMULATED OTHER COMPREHENSIVE

ACCUMULATED OTHER COMPREHENSIVE LOSS
	12 Months Ended Dec. 31, 2009 USD / shares
ACCUMULATED OTHER COMPREHENSIVE LOSS	NOTE 16ACCUMULATED OTHER COMPREHENSIVE LOSS The components of Accumulated other comprehensive loss within Cliffs shareholders equity and related tax effects allocated to each are shown below as of December31, 2009, 2008 and 2007: (In Millions) Pre-tax Amount Tax Benefit (Provision) After-tax Amount As of December31, 2007: Postretirement benefit liability $ (192.5 ) $ 37.7 $ (154.8 ) Foreign currency translation adjustments 96.5 96.5 Unrealized net gain on derivative financial instruments 26.7 (8.0 ) 18.7 Unrealized loss on interest rate swap (1.4 ) 0.5 (0.9 ) Unrealized gain on securities 15.7 (5.5 ) 10.2 $ (55.0 ) $ 24.7 $ (30.3 ) As of December31, 2008: Postretirement benefit liability $ (480.8 ) $ 137.5 $ (343.3 ) Foreign currency translation adjustments (68.6 ) (68.6 ) Unrealized net gain on derivative financial instruments 27.3 (8.2 ) 19.1 Unrealized loss on interest rate swap (2.6 ) 0.9 (1.7 ) Unrealized loss on securities (0.2 ) 0.1 (0.1 ) $ (524.9 ) $ 130.3 $ (394.6 ) As of December31, 2009: Postretirement benefit liability $ (451.9 ) $ 132.8 $ (319.1 ) Foreign currency translation adjustments 163.1 163.1 Unrealized net gain on derivative financial instruments 5.7 (1.7 ) 4.0 Unrealized gain on securities 43.1 (13.7 ) 29.4 $ (240.0 ) $ 117.4 $ (122.6 ) The following table reflects the changes in Accumulated other comprehensive loss related to Cliffs shareholders equity for 2009, 2008 and 2007: (In Millions) Postretirement Benefit Liability Adoption of Certain Provisions ofASC715 Unrealized Net Gain (Loss) on Securities Foreign Currency Translation Unrealized (Loss) on Interest Rate Swap Unrealized Net Gain (Loss) on Derivative Financial Instruments Accumulated Other Comprehensive Gain (Loss) Balance December31, 2006 $ (82.9 ) $ (110.7 ) $ 9.6 $ 9.6 $ $ 4.5 $ (169.9 ) Change during 2007 (71.9 ) 110.7 0.6 86.9 (0.9 ) 14.2 139.6 Balance December31, 2007 (154.8 ) 10.2 96.5 (0.9 ) 18.7 (30.3 ) Change during 2008 (188.5 ) (10.3 ) (165.1 ) (0.8 ) 0.4 (364.3 ) Balance December31, 2008 (343.3 ) (0.1 ) (68.6 ) (1.7 ) 19.1 (394.6 ) Change during 2009 24.2 29.5 231.7 1.7 (15.1 ) 272.0 Balance December31, 2009 $ (319

EARNINGS PER SHARE

EARNINGS PER SHARE
	12 Months Ended Dec. 31, 2009 USD / shares
EARNINGS PER SHARE	NOTE 17 EARNINGS PER SHARE The following table summarizes the computation of basic and diluted earnings per share attributable to Cliffs shareholders: (In Millions, Except per Share) 2009 2008 2007 Amount Per Share Amount Per Share Amount Per Share Income from continuing operations attributable to Cliffs shareholders $ 205.1 $ 1.64 $ 515.8 $ 5.08 $ 269.8 $ 3.25 Preferred dividends (1.1 ) (.01 ) (5.2 ) (.06 ) Income from continuing operations attributable to Cliffs common shareholders 205.1 1.64 514.7 5.07 264.6 3.19 Discontinued operations 0.2 Income attributable to Cliffs common shareholders basic 205.1 $ 1.64 514.7 $ 5.07 264.8 $ 3.19 Dilutive effect preferred dividend 1.1 5.2 Income attributable to Cliffs common shareholders plus assumed conversions diluted $ 205.1 $ 1.63 $ 515.8 $ 4.76 $ 270.0 $ 2.57 Average number of shares (in thousands) Basic 124,998 101,471 82,988 Employee stock plans 753 1,485 528 Convertible preferred stock 5,332 21,510 Diluted 125,751 108,288 105,026

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES
	12 Months Ended Dec. 31, 2009 USD / shares
COMMITMENTS AND CONTINGENCIES	NOTE 18COMMITMENTS AND CONTINGENCIES We have total contractual obligations and binding commitments of approximately $2.7 billion as of December31, 2009 compared with $2.5 billion as of December31, 2008, primarily related to purchase commitments, principal and interest payments on long-term debt, lease obligations, pension and OPEB funding minimums, and mine closure obligations. Such future commitments total $661.0 million in 2010, $314.9 million in 2011, $429.7 million in 2012, $470.0 million in 2013, $183.4 million in 2014 and $597.4 million thereafter. Purchase Commitments In 2008, we incurred a capital commitment for the purchase of a new longwall plow system for our Pinnacle mine in West Virginia. The system, which requires a capital investment of approximately $83 million, will replace the current longwall plow system in an effort to reduce maintenance costs and increase production at the mine. As of December31, 2009, capital expenditures related to this purchase were approximately $29 million. Remaining expenditures of approximately $40 million and $14 million are scheduled to be made in 2010 and 2011, respectively, based upon revised payment and delivery terms negotiated with the supplier. Contingencies Litigation We are currently a party to various claims and legal proceedings incidental to our operations. If management believes that a loss arising from these matters is probable and can reasonably be estimated, we record the amount of the loss, or the minimum estimated liability when the loss is estimated using a range, and no point within the range is more probable than another. As additional information becomes available, any potential liability related to these matters is assessed and the estimates are revised, if necessary. Based on currently available information, management believes that the ultimate outcome of these matters, individually and in the aggregate, will not have a material adverse effect on our financial position or results of operations. However, litigation is subject to inherent uncertainties, and unfavorable rulings could occur. An unfavorable ruling could include monetary damages or an injunction. If an unfavorable ruling were to occur, there exists the possibility of a material adverse impact on the financial position and results of operations of the period in which the ruling occurs, or future periods. However, we believe that any pending litigation will not result in a material liability in relation to our consolidated financial statements. Refer to Part 1 Item3, Legal Proceedings, for additional information. Environmental Matters We had environmental liabilities of $14.5 million and $16.4 million at December31, 2009 and 2008 respectively, including obligations for known environmental remediation exposures at active and closed mining operations and other sites. These amounts have been recognized based on the estimated cost of investigation and remediation at each site, and include site studies, design and implementation of remediation plans, legal and consulting fees, and post-remediation monitoring and related activities. If the cost can only be estimated as a range of possible amou

CASH FLOW INFORMATION

CASH FLOW INFORMATION
	12 Months Ended Dec. 31, 2009 USD / shares
CASH FLOW INFORMATION	NOTE 19 CASH FLOW INFORMATION A reconciliation of capital additions to cash paid for capital expenditures for the years ended December31, 2009, 2008 and 2007 is as follows: (In Millions) 2009 2008 2007 Capital additions $ 168.2 $ 232.6 $ 235.1 Cash paid for capital expenditures 116.3 182.5 199.5 Difference $ 51.9 $ 50.1 $ 35.6 Non-cash accruals $ 3.0 $ 25.7 $ 4.7 Capital leases 48.9 24.4 30.9 Total $ 51.9 $ 50.1 $ 35.6 Cash payments for interest and income taxes in 2009, 2008 and 2007 are as follows: (In Millions) 2009 2008 2007 Taxes paid on income $ 64.8 $ 175.5 $ 123.6 Interest paid on debt obligations 25.3 26.3 16.6

RELATED PARTIES

RELATED PARTIES
	12 Months Ended Dec. 31, 2009 USD / shares
RELATED PARTIES	NOTE 20 RELATED PARTIES We co-own four of our six North American iron ore mines with various joint venture partners that are integrated steel producers or their subsidiaries. We are the manager of each of the mines we co-own and rely on our joint venture partners to make their required capital contributions and to pay for their share of the iron ore pellets that we produce. The joint venture partners are also our customers. The following is a summary of the mine ownership of these four North American iron ore mines at December31, 2009: Percent ownership Mine CliffsNatural Resources ArcelorMittal U.S.Steel Canada Empire 79.0 21.0 Tilden 85.0 15.0 Hibbing 23.0 62.3 14.7 Wabush (1) 26.8 28.6 44.6 (1) On October12, 2009, we exercised our right of first refusal to acquire U.S. Steel Canadas 44.6 percent interest and ArcelorMittal Dofascos 28.6 percent interest in Wabush, thereby increasing our ownership stake in Wabush Mines to 100 percent. Ownership transfer to Cliffs was completed on February1, 2010. Refer to NOTE 5 ACQUISTIONS OTHER INVESTMENTS for further information. ArcelorMittal has a unilateral right to put its interest in the Empire Mine to us, but has not exercised this right to date. Product revenues to related parties were as follows: (In Millions) 2009 2008 2007 Product revenues to related parties $ 593.8 $ 1,020.5 $ 754.3 Total product revenues 2,216.2 3,294.8 1,997.3 Related party product revenue as a percent of total product revenue 26.8 % 31.0 % 37.8 % Accounts receivable from related parties were $1.8 million and $2.9 million at December31, 2009 and 2008, respectively. In 2002, we entered into an agreement with Ispat that restructured the ownership of the Empire mine and increased our ownership from 46.7 percent to 79 percent in exchange for assumption of all mine liabilities. Under the terms of the agreement, we indemnified Ispat from obligations of Empire in exchange for certain future payments to Empire and to us by Ispat of $120.0 million, recorded at a present value of $38.3 million and $43.2 million at December31, 2009 and 2008, respectively. Of these amounts, $28.3 million and $33.2 million were classified as Long-term receivable at December31, 2009 and 2008, respectively, with the balances current, over the 12-year life of the supply agreement. Supply agreements with one of our customers include provisions for supplemental revenue or refunds based on the customers annual steel pricing for the year the product is consumed in the customers blast furnace. The supplemental pricing is characterized as an embedded derivative. Refer to NOTE 3 DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES for further information.

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS
	12 Months Ended Dec. 31, 2009 USD / shares
SUBSEQUENT EVENTS	NOTE 21 SUBSEQUENT EVENTS Freewest Acquisition On January25, 2010, we obtained shareholder approval to acquire all of the outstanding shares of Freewest for C$1.00 per share, court approval was received on January26, 2010, and the transaction closed on January27, 2010. We issued 0.0201 of our common shares for each Freewest share, a total of 4.2million common shares, representing total purchase consideration of approximately $174 million. Wabush Acquisition On January26, 2010, we obtained the remaining regulatory approvals required to obtain full ownership of Wabush. Ownership transfer to Cliffs of U.S. Steel Canadas 44.6 percent interest and ArcelorMittal Dofascos 28.6 percent interest in Wabush was completed on February1, 2010. Total purchase consideration for the acquisition was approximately $88 million, subject to certain working capital adjustments. Ratification of New Labor Agreement at Wabush In February 2010, we entered into a new five-year labor agreement with the USW for our Wabush mine. The agreement provides for a 15 percent increase in labor costs over the five-year term of the agreement, inclusive of benefits. We have evaluated subsequent events through February18, 2010, which represents the date of financial statement issuance.

QUARTERLY RESULTS OF OPERATIONS

QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)
	12 Months Ended Dec. 31, 2009 USD / shares
QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)	NOTE 22 QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) The sum of quarterly EPS may not equal EPS for the year due to discrete quarterly calculations. (In Millions, Except Per Common Share) 2009 Quarters Year First Second Third Fourth Revenues from product sales and services $ 464.8 $ 390.3 $ 666.4 $ 820.5 $ 2,342.0 Sales margin 42.4 (11.7 ) 103.2 175.0 308.9 Income (Loss) attributable to Cliffs before extraordinary gain and cumulative effect of accounting change (7.4 ) 45.5 58.8 108.2 205.1 Net income (loss) attributable to Cliffs shareholders (7.4 ) 45.5 58.8 108.2 205.1 Earnings (Loss) per common share attributable to Cliffs shareholders: Basic $ (0.07 ) $ 0.36 $ 0.45 $ 0.83 $ 1.64 Diluted (0.07 ) 0.36 0.45 0.82 1.63 2008 Quarters Year First Second Third Fourth Revenues from product sales and services $ 494.4 $ 1,008.6 $ 1,189.7 $ 916.4 $ 3,609.1 Sales margin 82.4 426.3 365.0 286.0 1,159.7 Income attributable to Cliffs before extraordinary gain and cumulative effect of accounting change 16.7 270.2 174.9 54.0 515.8 Net income attributable to Cliffs shareholders 16.7 270.2 174.9 54.0 515.8 Earnings per common share attributable to Cliffs shareholders: Basic $ 0.18 $ 2.75 $ 1.67 $ 0.48 $ 5.07 Diluted 0.16 2.57 1.61 0.47 4.76 In the fourth quarter of 2008, we had certain non-recurring items which had a material impact on the quarterly results. In particular, on November17, 2008, we announced the termination of the definitive merger agreement with Alpha Natural Resources, Inc., under which we would have acquired all outstanding shares of Alpha. Based upon the macroeconomic environment in 2008, uncertainty in the steel industry, shareholder dynamics, and the risks and costs of potential litigation, both our Board of Directors and Alphas Board of Directors determined that termination of the merger agreement was in the best interest of its equity holders. Under the terms of the settlement agreement, we were required to pay Alpha a $70 million termination fee, which was financed through our revolving credit facility and paid in November 2008. As a result, $90.1 million in termination fees and associated acquisition costs were expensed through Other Operating Income (Expense) on the Statement of Consolidated Operations in the fourth quarter of 2008 upon termination of the definitive merger agreement. Additionally, in the fourth quarter of 2008, we recorded impairment charges of $25.1 million in Other income (expense) on the Statement of Consolidated Operations related to declines in the fair value of our available-for-sale securities which we concluded were other than temporary. As of December31, 2008, our investments in PolyMet and Golden West had fair values totaling $6.2 million an

Schedule II - Valuation and Qua

Schedule II - Valuation and Qualifying Accounts
	12 Months Ended Dec. 31, 2009 USD / shares
Schedule II - Valuation and Qualifying Accounts	Cliffs Natural Resources Inc. and Subsidiaries Schedule IIValuation and Qualifying Accounts (Dollars in Millions) Classification Balanceat Beginning of Year Additions Deductions Balanceat End of Year Charged to Cost and Expenses Charged to Other Accounts Acquisition Year Ended December31, 2009: Deferred Tax Valuation Allowance $ 17.6 $ 53.8 $ 1.7 $ 16.8 $ 0.5 $ 89.4 Year Ended December31, 2008: Deferred Tax Valuation Allowance $ 26.3 $ 9.5 $ 8.1 $ (13.3 ) $ 13.0 $ 17.6 Year Ended December31, 2007: Deferred Tax Valuation Allowance $ 11.9 $ 13.0 $ 1.4 $ $ $ 26.3

Document Information

Document Information
	12 Months Ended Dec. 31, 2009 USD / shares
Document Type	10-K
Amendment Flag	false
Document Period End Date	2009-12-31

Entity Information

Entity Information (USD $)
	12 Months Ended Dec. 31, 2009	Feb. 15, 2010	Jun. 30, 2009
Trading Symbol	CLF
Entity Registrant Name	CLIFFS NATURAL RESOURCES INC.
Entity Central Index Key	0000764065
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		135,224,028
Entity Public Float			$3,162,840,459