July 27, 2006

Century Aluminum Reports Second Quarter 2006 Earnings

MONTEREY, CA, Jul 27, 2006 (MARKET WIRE via COMTEX News Network) -- Century Aluminum Company (NASDAQ: CENX) reported net income of $45.8 million ($1.41 per basic share and $1.35 per diluted share) for the second quarter of 2006. Reported second quarter results were negatively impacted by an after-tax charge of $19.5 million ($0.60 per basic share and $0.57 per diluted share) for mark-to-market adjustments on forward contracts that do not qualify for cash flow hedge accounting.

In the second quarter of 2005, the company reported net income of $40.7 million ($1.27 per basic and diluted share), which included an after-tax gain of $15.7 million ($0.49 per basic and diluted share) for mark-to-market adjustments on forward contracts that do not qualify for cash flow hedge accounting.

Second quarter 2006 highlights included:

--  Revenues of $406.0 million and operating income of $99.6 million were
    up 17 percent and 55 percent respectively from highs set in the first
    quarter of 2006
--  Strong operating results at all locations
--  At Nordural, the capacity expansion from 90,000 to 220,000 metric tons
    per year (mtpy) remains on schedule and budget for a fourth quarter, 2006
    completion
--  The expected completion date of the further expansion of Nordural to
    260,000 mtpy was accelerated to the fourth quarter of 2007
--  A labor agreement was reached with the United Steelworkers at the
    Hawesville, Kentucky smelter
--  A memorandum of understanding to purchase electrical energy for the
    greenfield smelter project in Helguvik, Iceland was signed with Icelandic
    power producers Hitaveita Sudurnesja and Orkuveita Reykjavikur
--  A joint venture agreement was reached with Minmetals Aluminum Company
    to explore the potential of developing a bauxite mine and associated 1.5
    million mtpy alumina refining facility in Jamaica

Sales in the second quarter of 2006 were $406.0 million, compared with $283.3 million in the second quarter of 2005. Shipments of primary aluminum for the quarter totaled 378.6 million pounds compared with 339.5 million pounds in the year-ago quarter, reflecting the impact of the Nordural expansion.

For the first half of 2006 the company reported a net loss of $95.8 million ($2.96 per basic and diluted share), which includes an after-tax charge of $203.0 million ($6.28 per basic and diluted share) for mark-to-market adjustments on forward contracts that do not qualify for cash flow hedge accounting. This result compares with net income of $52.5 million ($1.63 per basic and diluted share) in the year-ago period.

Sales in the first six months of 2006 were $752.9 million compared with $568.7 million in the same period of 2005. Shipments of primary aluminum for the first six months of 2006 were 724.6 million pounds compared with 676.5 million pounds for the comparable 2005 period.

"Ongoing sound operating results at all of our facilities, robust markets and good progress on our Icelandic expansion resulted in an outstanding second quarter," said president and chief executive officer Logan W. Kruger. "The labor contract at Hawesville provides stability for the long-term operation of that plant. Importantly, we continued to make solid progress on our growth plan. We brought forward the 40,000 mtpy Nordural expansion to 260,000 mtpy into 2007. Also in Iceland, we advanced our growth plans by securing electrical energy for the first phase of the Helguvik greenfield project. Lastly, we are pleased to be working with our partners at Minmetals toward what could become a major expansion of our presence in Jamaica."

Century's primary aluminum capacity will stand at 745,000 mtpy by the fourth quarter of 2006. The company owns and operates a 244,000 mtpy plant at Hawesville, Kentucky; a 170,000 mtpy plant at Ravenswood, West Virginia; and a 90,000 mtpy plant at Grundartangi, Iceland that is currently being expanded to 220,000 mtpy by the fourth quarter of 2006. The company also owns a 49.67-percent interest in a 222,000 mtpy reduction plant at Mt. Holly, South Carolina. ALCOA Inc. owns the remainder of the plant and is the operating partner. Century also holds a 50-percent share of the 1.25 million mtpy Gramercy Alumina refinery in Gramercy, Louisiana and related bauxite assets in Jamaica. Century's corporate offices are located in Monterey, California.

This press release may contain "forward-looking statements" within the meaning of U.S. federal securities laws. The company has based its forward-looking statements on current expectations and projections about the future; however, these statements are subject to risks, uncertainties and assumptions, any of which could cause the company's actual results to differ materially from those expressed in its forward-looking statements. More information about these risks, uncertainties and assumptions can be found in the risk factors and forward-looking statements cautionary language contained in the company's Annual Report on Form 10-K and in other filings made with the Securities and Exchange Commission. The company does not undertake, and specifically disclaims, any obligation to revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date such forward-looking statements are made.

Century Aluminum Company
                  Consolidated Statements of Operations
                 (in Thousands, Except Per Share Amounts)
                                (Unaudited)
                                 Three months ended     Six months ended
                                      June 30,              June 30,
                                --------------------  --------------------
                                  2006       2005       2006       2005
                                ---------  ---------  ---------  ---------
NET SALES:
  Third-party customers         $ 356,242  $ 243,329  $ 654,715  $ 490,754
  Related parties                  49,734     39,927     98,207     77,898
                                ---------  ---------  ---------  ---------
                                  405,976    283,256    752,922    568,652
COST OF GOODS SOLD                297,972    237,908    568,450    471,737
                                ---------  ---------  ---------  ---------
GROSS PROFIT                      108,004     45,348    184,472     96,915
SELLING, GENERAL AND
 ADMINISTRATIVE EXPENSES            8,376      8,046     20,495     16,842
                                ---------  ---------  ---------  ---------
OPERATING INCOME                   99,628     37,302    163,977     80,073
INTEREST EXPENSE - Net             (8,647)    (6,242)   (15,202)   (12,708)
NET GAIN (LOSS) ON FORWARD
 CONTRACTS                        (30,456)    24,496   (317,216)     1,001
OTHER INCOME (EXPENSE) - Net           37       (472)      (124)       (65)
                                ---------  ---------  ---------  ---------
INCOME (LOSS) BEFORE INCOME
 TAXES AND EQUITY IN EARNINGS
 OF JOINT VENTURES                 60,562     55,084   (168,565)    68,301
INCOME TAX (EXPENSE) BENEFIT      (19,109)   (17,880)    65,247    (22,733)
                                ---------  ---------  ---------  ---------
INCOME (LOSS) BEFORE EQUITY IN
 EARNINGS OF JOINT VENTURES        41,453     37,204   (103,318)    45,568
EQUITY IN EARNINGS OF JOINT
 VENTURES                           4,347      3,540      7,547      6,906
                                ---------  ---------  ---------  ---------
NET INCOME (LOSS)               $  45,800  $  40,744  $ (95,771) $  52,474
                                =========  =========  =========  =========
EARNINGS (LOSS) PER COMMON
 SHARE
  Basic - Net income (loss)     $    1.41  $    1.27  $   (2.96) $    1.63
  Diluted - Net income (loss)   $    1.35  $    1.27  $   (2.96) $    1.63
WEIGHTED AVERAGE COMMON SHARES
 OUTSTANDING
  Basic                            32,419     32,140     32,341     32,099
  Diluted                          34,297     32,196     32,341     32,162
                         Century Aluminum Company
                        Consolidated Balance Sheets
                          (Dollars in Thousands)
                                (Unaudited)
                                                    June 30,  December 31,
ASSETS                                                2006         2005
                                                  -----------  -----------
Current Assets:
  Cash                                            $    29,175  $    17,752
  Restricted cash                                       6,029        2,028
  Accounts receivable - net                           118,191       83,016
  Due from affiliates                                  15,635       18,638
  Inventories                                         132,956      111,436
  Prepaid and other current assets                     21,375       23,918
  Deferred taxes - current portion                     53,281       37,705
                                                  -----------  -----------
    Total current assets                              376,642      294,493
Property, plant and equipment - net                 1,155,732    1,070,158
Intangible asset - net                                 68,118       74,643
Goodwill                                               94,844       94,844
Other assets                                          251,358      143,293
                                                  -----------  -----------
    Total                                         $ 1,946,694  $ 1,677,431
                                                  ===========  ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
  Accounts payable, trade                         $    59,291  $    61,919
  Due to affiliates                                   221,650      158,682
  Accrued and other current liabilities                52,691       53,715
  Long term debt - current portion                     16,093          581
  Accrued employee benefits costs - current
   portion                                              9,333        9,333
  Convertible senior notes                            175,000      175,000
  Industrial revenue bonds                              7,815        7,815
                                                  -----------  -----------
    Total current liabilities                         541,873      467,045
                                                  -----------  -----------
Senior unsecured notes payable - net                  250,000      250,000
Nordural debt                                         283,636      230,436
Revolving credit facility                                   -        8,069
Accrued pension benefit costs - less current
 portion                                               10,904       10,350
Accrued postretirement benefits costs - less
 current portion                                      103,245       96,660
Due to affiliates - less current portion              592,550      337,416
Other liabilities                                      28,420       28,010
Deferred taxes                                         16,890       16,890
                                                  -----------  -----------
    Total noncurrent liabilities                    1,285,645      977,831
                                                  -----------  -----------
Shareholders' Equity:
  Common stock (one cent par value, 100,000,000
   shares authorized; 32,426,835
   shares outstanding at June 30, 2006 and
   32,188,165 at December 31, 2005)                       324          322
  Additional paid-in capital                          429,797      419,009
  Accumulated other comprehensive loss               (119,816)     (91,418)
  Accumulated deficit                                (191,129)     (95,358)
                                                  -----------  -----------
    Total shareholders' equity                        119,176      232,555
                                                  -----------  -----------
    Total                                         $ 1,946,694  $ 1,677,431
                                                  ===========  ===========
                         Century Aluminum Company
                  Consolidated Statements of Cash Flows
                          (Dollars in Thousands)
                                (Unaudited)
                                                        Six months ended
                                                            June 30,
                                                        2006       2005
                                                      ---------  ---------
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net income (loss)                                   $ (95,771) $  52,474
  Adjustments to reconcile net income to net cash
   provided by operating activities:
    Unrealized net (gain) loss on forward contracts     283,573     (3,429)
    Depreciation and amortization                        32,224     28,050
    Deferred income taxes                               (65,247)    22,733
    Pension and other post retirement benefits            7,139      7,421
    Stock-based compensation                              3,872          -
    Excess tax benefits from share based compensation    (1,090)         -
    (Gain) loss on disposal of assets                        45         (4)
    Non cash loss on early extinguishment of debt             -        253
    Change in operating assets and liabilities:
      Accounts receivable - net                         (35,175)   (24,999)
      Due from affiliates                                 3,003        327
      Inventories                                       (17,880)     6,834
      Prepaid and other current assets                   (3,459)    (5,712)
      Accounts payable, trade                              (710)    (6,745)
      Due to affiliates                                   2,173     (9,548)
      Accrued and other current liabilities             (33,802)    (3,948)
      Other - net                                       (11,605)    (4,983)
                                                      ---------  ---------
    Net cash provided by operating activities            67,290     58,724
                                                      ---------  ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
  Purchase of property, plant and equipment              (7,568)    (5,481)
  Nordural expansion                                   (109,002)  (113,654)
  Proceeds from sale of property, plant and equipment        10         59
  Restricted cash deposits                               (4,001)      (350)
  Business acquisitions, net of cash acquired                 -     (7,000)
                                                      ---------  ---------
    Net cash used in investing activities              (120,561)  (126,426)
                                                      ---------  ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Borrowings of long-term debt                           69,000    145,378
  Repayment of long-term debt                              (288)   (83,023)
  Net repayments under revolving credit facility         (8,069)         -
  Financing fees                                              -     (4,617)
  Excess tax benefits from share based compensation       1,090          -
  Dividends                                                   -        (16)
  Issuance of common stock                                2,961        986
                                                      ---------  ---------
    Net cash provided by financing activities            64,694     58,708
                                                      ---------  ---------
NET INCREASE (DECREASE) IN CASH                          11,423     (8,994)
CASH, BEGINNING OF PERIOD                                17,752     44,168
                                                      ---------  ---------
CASH, END OF PERIOD                                   $  29,175  $  35,174
                                                      =========  =========
                         Century Aluminum Company
                          Selected Operating Data
                                (Unaudited)
                       SHIPMENTS - PRIMARY ALUMINUM
                              Direct (1)                   Toll
                      -------------------------  -------------------------
                      Metric    (000)            Metric    (000)    (000)
                        Tons   Pounds   $/Pound    Tons   Pounds   Revenue
                      -------  -------  -------  -------  -------  -------
2006
2nd Quarter           132,590  292,311  $  1.12   39,125   86,255  $77,702
1st Quarter           132,378  291,843  $  1.03   24,573   54,174  $45,166
2005
2nd Quarter           130,974  288,748  $  0.86   23,025   50,761  $34,174
1st Quarter           130,083  286,783  $  0.88   22,756   50,168  $33,372
(1) Does not include Toll shipments from Nordural
                       2006(1)                                      2011-
                           (2)  2007(2)  2008(2)  2009(2)  2010(2)  2015(2)
                      -------  -------  -------  -------  -------  -------
Base Volume
     Pounds (000)     197,267  374,565  240,745  231,485  231,485  826,733
     Metric Tons       89,479  169,900  109,200  105,000  105,000  375,000
     Percent of
      estimated
      capacity             24%      22%      14%      13%      13%       9%
Potential Additional
 Volume(2)
     Pounds (000)      27,778  111,113  220,903  231,485  231,485  826,733
     Metric Tons       12,600   50,400  100,200  105,000  105,000  375,000
     Percent of
      estimated
      capacity              3%       7%      12%      13%      13%       9%
(1) The forward priced sales in 2006 exclude July 2006 shipments to
customers that are priced based upon the prior month's market price.
(2) Certain financial sales contracts included in the forward priced sales
base volume for the period 2006 through 2015 contain clauses that trigger
potential additional sales volume when the market price for a contract
month is above the base contract ceiling price.  These contracts will be
settled monthly and, if the market price exceeds the ceiling price for all
contract months through 2015, the potential additional sales volume would
be equivalent to the amounts shown above.
Century Aluminum Company
Monterey, California
Michael Dildine
831-642-9364
Contact via http://www.marketwire.com/mw/emailprcntct?id=B9CCA41259AB892C

SOURCE: Century Aluminum Company

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