July 27, 2010

Century Aluminum Reports Second Quarter 2010 Earnings

MONTEREY, CA, Jul 27, 2010 (MARKETWIRE via COMTEX News Network) -- Century Aluminum Company (NASDAQ: CENX) reported net earnings of $5.1 million ($0.05 per basic and diluted share) for the second quarter of 2010. Reported second quarter results were positively impacted by a mark-to-market gain on forward contracts of $9.3 million primarily related to LME price protection options. Cost of sales for the quarter included a $16.0 million charge for the portion of power costs at Hawesville payable by the previous power supplier per the terms of the power agreements and a $7.0 million charge for lower of cost or market inventory adjustments.

In the second quarter of 2009, the company reported a net loss of $107.1 million ($1.45 per basic and diluted share). Reported second quarter results were negatively impacted by an impairment loss of $73.2 million related to the divestiture of the Gramercy Alumina LLC and St. Ann Bauxite Ltd. joint ventures and a charge of $9.2 million related to ongoing costs associated with the production curtailments at the Ravenswood, WV and Hawesville, KY primary aluminum smelters. Lower of cost or market inventory adjustments of $26.9 million favorably impacted the quarterly results.

Recent highlights included:

--  Cash provided by operating activities was $50.5 million for the
    quarter; cash and cash equivalents increased to $256.3 million as of
    June 30, 2010.
--  Negotiations are progressing on a new labor contract for the
    Hawesville, KY smelter.
--  The $100 million revolving credit facility was refinanced with a
    generally similar facility maturing in 2014.
--  Nordural continues to prepare for a restart of major construction
    activities at its greenfield project site near Helguvik, Iceland.

Sales in the second quarter of 2010 were $287.9 million, compared with $189.2 million in the second quarter of 2009. Shipments of primary aluminum for the quarter totaled 144,580 tonnes compared with 145,693 tonnes in the year-ago quarter.

For the first half of 2010, the company reported net income of $11.5 million ($0.11 per basic and diluted share). First half results were positively impacted by a mark-to-market gain on forward contracts of $7.3 million primarily related to LME price protection options. Cost of sales for the six month period included a $31.5 million charge for the portion of power costs at Hawesville payable by the previous power supplier per the terms of the power agreements and a $6.9 million charge for lower of cost or market inventory adjustments. This result compares with a net loss of $221.8 million ($3.20 per basic and diluted share) in the first half of 2009, which included a charge of $33.5 million for costs associated with production curtailments at the Ravenswood, WV and Hawesville, KY primary aluminum smelters, a favorable lower of cost or market inventory adjustment of $24.6 million and an impairment loss of $73.2 million related to the divestiture of the Gramercy Alumina LLC and St. Ann Bauxite Ltd. joint ventures.

Sales in the first six months of 2010 were $573.2 million compared with $413.7 million in the same period of 2009. Shipments of primary aluminum for the first six months of 2010 were 289,257 tonnes compared with 311,181 tonnes for the comparable 2009 period.

Logan Kruger, President and CEO, commented, "The market trends we have monitored since the beginning of the year have continued largely unchanged. Despite some signs of moderation recently, economic growth in China and other developing regions has continued largely apace, and the physical availability of metal remains constrained in most regions. At the same time, we are closely watching the global financial and capital markets and assessing the risk that recent dislocations could dampen the economic recovery. Within this complex framework, we are managing the company, both existing operations and our growth projects, with reasonable caution.

"Century has made good progress during the last several months," continued Mr. Kruger. "The company produced strong cash flow consistent with our expectations. The teams at Hawesville and Grundartangi continue to safely produce good results. The financing and other preparations for our new smelter at Helguvik are proceeding. Final negotiations on amendments to our Helguvik power supply contracts will be a primary factor in determining the timing of the restart of major construction and engineering activity."

Century Aluminum Company owns primary aluminum capacity in the United States and Iceland. Century's corporate offices are located in Monterey, California.

Century Aluminum's quarterly conference call is scheduled for 5:00 p.m. Eastern time today. To listen to the conference call and to view related presentation materials, go to www.centuryaluminum.com and click on the conference call link on the homepage.

Certified Advisors for the First North market of the OMX Nordic Exchange Iceland hf. for Global Depositary Receipts in Iceland:

Atli B. Gudmundsson, Senior Manager -- Corporate Finance, NBI hf.

Steingrimur Helgason, Director -- Corporate Finance, NBI hf.

Cautionary Statement

This press release and comments made by Century Aluminum management on the quarterly conference call contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements about future, not past, events and involve certain risks and uncertainties, any of which could cause our actual results to differ materially from those expressed in our forward-looking statements. Such risks and uncertainties may include, without limitation, declines in aluminum prices or demand or increases in our operating costs; a worsening of global financial and economic conditions; our ability to access the credit and capital markets on acceptable terms, including to finance the completion of our Helguvik, Iceland smelter; additional delays in the completion of the Helguvik, Iceland smelter; our ability to successfully conclude our labor negotiations at our Hawesville, KY smelter; our ability to successfully manage and/or improve performance at each of our operating smelters; and our ability to successfully conclude negotiations on amendments to the power contracts for the Helguvik, Iceland smelter. More information about these risks, uncertainties and assumptions can be found in the risk factors and forward-looking statements cautionary language contained in our Annual Report on Form 10-K and in other filings made with the Securities and Exchange Commission. We do not undertake, and specifically disclaim, any obligation to revise any forward-looking statements to reflect the occurrence of future events or circumstances.

                         Century Aluminum Company
                  Consolidated Statements of Operations
                 (in Thousands, Except Per Share Amounts)
                                (Unaudited)
                              Three months ended       Six months ended
                                   June 30,                June 30,
                            ----------------------  ----------------------
                               2010        2009        2010        2009
                            ----------  ----------  ----------  ----------
NET SALES:
     Third-party customers  $  183,045  $  140,097  $  375,977  $  310,511
     Related parties           104,808      49,056     197,265     103,229
                            ----------  ----------  ----------  ----------
                               287,853     189,153     573,242     413,740
COST OF GOODS SOLD             266,337     194,380     517,750     491,328
                            ----------  ----------  ----------  ----------
GROSS PROFIT (LOSS)             21,516      (5,227)     55,492     (77,588)
OTHER OPERATING EXPENSES -
 Net                             4,644       9,166       9,109      33,498
SELLING, GENERAL AND
 ADMINISTRATIVE EXPENSES        10,964      11,271      23,215      21,391
                            ----------  ----------  ----------  ----------
OPERATING INCOME (LOSS)          5,908     (25,664)     23,168    (132,477)
INTEREST EXPENSE - THIRD
 PARTY - Net                    (6,255)     (7,625)    (12,552)    (14,943)
INTEREST INCOME - RELATED
 PARTY                             111         144         220         286
NET GAIN (LOSS) ON FORWARD
 CONTRACTS                       9,294      (3,268)      7,322      (6,870)
OTHER INCOME - Net                 230         586         638         344
                            ----------  ----------  ----------  ----------
INCOME (LOSS) BEFORE INCOME
 TAXES AND EQUITY
 IN EARNINGS (LOSSES) OF
 JOINT VENTURES                  9,288     (35,827)     18,796    (153,660)
INCOME TAX (EXPENSE)
 BENEFIT                        (4,619)     (2,573)     (8,900)      1,523
                            ----------  ----------  ----------  ----------
INCOME (LOSS) BEFORE EQUITY
 IN EARNINGS (LOSSES)
 OF JOINT VENTURES               4,669     (38,400)      9,896    (152,137)
EQUITY IN EARNINGS (LOSSES)
 OF JOINT VENTURES                 477     (68,746)      1,582     (69,633)
                            ----------  ----------  ----------  ----------
NET INCOME (LOSS)           $    5,146  $ (107,146) $   11,478  $ (221,770)
                            ==========  ==========  ==========  ==========
EARNINGS (LOSS) PER COMMON
 SHARE
    Basic                   $     0.05  $    (1.45) $     0.11  $    (3.20)
    Diluted                 $     0.05  $    (1.45) $     0.11  $    (3.20)
WEIGHTED AVERAGE COMMON
 SHARES OUTSTANDING
     Basic                      92,672      74,143      92,611      69,402
     Diluted                    93,332      74,143      93,218      69,402
Percentage of Net Income
 (Loss) Allocated to Common
 Shareholders                    91.79%     100.00%      91.76%     100.00%
                         Century Aluminum Company
                        Consolidated Balance Sheets
                          (Dollars in Thousands)
                                (Unaudited)
                                                  June 30,    December 31,
ASSETS                                              2010          2009
                                                ------------  ------------
Current Assets:
     Cash and cash equivalents                  $    256,264  $    198,234
     Restricted cash                                   9,862         8,879
     Accounts receivable - net                        36,693        37,706
     Due from affiliates                              34,222        19,255
     Inventories                                     135,636       131,473
     Prepaid and other current assets                 39,913        93,921
                                                ------------  ------------
          Total current assets                       512,590       489,468
Property, plant and equipment - net                1,274,199     1,298,288
Due from affiliates - less current portion             9,828         5,859
Other assets                                          79,663        68,135
                                                ------------  ------------
          Total                                 $  1,876,280  $  1,861,750
                                                ============  ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
     Accounts payable, trade                    $     69,739  $     77,301
     Due to affiliates                                33,329        32,708
     Accrued and other current liabilities            32,016        38,598
     Accrued employee benefits costs - current
      portion                                         16,027        12,997
     Convertible senior notes                         44,342        43,239
     Industrial revenue bonds                          7,815         7,815
                                                ------------  ------------
          Total current liabilities                  203,268       212,658
                                                ------------  ------------
Senior notes payable                                 248,069       247,624
Accrued pension benefits costs - less current
 portion                                              42,073        43,281
Accrued postretirement benefits costs - less
 current portion                                     186,625       177,231
Other liabilities                                     27,239        31,604
Deferred taxes                                        90,822        81,622
                                                ------------  ------------
          Total noncurrent liabilities               594,828       581,362
                                                ------------  ------------
Shareholders' Equity:
     Series A Preferred stock (one cent par
      value, 5,000,000 shares authorized;
      82,661 and 83,452 shares issued and
      outstanding at June 30, 2010 and December
      31, 2009, respectively)                              1             1
     Common stock (one cent par value,
      195,000,000 shares authorized; 92,734,496
      and 92,530,068 shares issued and
      outstanding at June 30, 2010 and December
      31, 2009, respectively)                            927           925
     Additional paid-in capital                    2,504,165     2,501,389
     Accumulated other comprehensive loss            (78,072)      (74,270)
     Accumulated deficit                          (1,348,837)   (1,360,315)
                                                ------------  ------------
          Total shareholders' equity               1,078,184     1,067,730
                                                ------------  ------------
          Total                                 $  1,876,280  $  1,861,750
                                                ============  ============
                         Century Aluminum Company
                  Consolidated Statements of Cash Flows
                          (Dollars in Thousands)
                                (Unaudited)
                                                        Six months ended
                                                            June 30,
                                                        2010       2009
                                                      ---------  ---------
CASH FLOWS FROM OPERATING ACTIVITIES:
   Net income (loss)                                  $  11,478  $(221,770)
   Adjustments to reconcile net income (loss) to net
    cash provided by operating activities:
      Unrealized net (gain) loss on forward contracts    (7,568)     2,514
      Realized benefit of contractual receivable         32,193          -
      Accrued and other plant curtailment costs - net    (2,576)    21,051
      Debt discount amortization                          1,548      4,004
      Depreciation and amortization                      31,505     40,063
      Lower of cost or market inventory adjustment        6,999    (38,187)
      Deferred income taxes                               9,217     25,030
      Pension and other postretirement benefits           8,218      7,495
      Stock-based compensation                            2,163      1,269
      Non-cash loss from disposition of equity
       investments                                            -     73,234
      Undistributed earnings of joint ventures           (1,582)    (3,601)
      Change in operating assets and liabilities:
           Accounts receivable - net                      1,013     26,250
           Sale of short-term trading securities              -     13,686
           Due from affiliates                          (16,671)    24,999
           Inventories                                  (11,162)    31,140
           Prepaid and other current assets              20,423     77,891
           Accounts payable, trade                       (6,725)   (24,768)
           Due to affiliates                                621    (11,435)
           Accrued and other current liabilities         (2,189)    (7,109)
           Other - net                                   (4,773)     4,916
                                                      ---------  ---------
      Net cash provided by operating activities          72,132     46,672
                                                      ---------  ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
   Purchase of property, plant and equipment             (3,012)   (11,927)
   Nordural expansion                                   (10,113)   (12,132)
   Investments in and advances to joint ventures            (17)    (1,023)
   Restricted and other cash deposits                      (983)         -
                                                      ---------  ---------
      Net cash used in investing activities             (14,125)   (25,082)
                                                      ---------  ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
   Repayment under revolving credit facility                  -    (25,000)
   Issuance of common stock - net                            23    104,041
                                                      ---------  ---------
      Net cash provided by financing activities              23     79,041
                                                      ---------  ---------
NET CHANGE IN CASH AND CASH EQUIVALENTS                  58,030    100,631
CASH AND CASH EQUIVALENTS, BEGINNING OF THE PERIOD      198,234    129,400
                                                      ---------  ---------
CASH AND CASH EQUIVALENTS, END OF THE PERIOD          $ 256,264  $ 230,031
                                                      =========  =========
                         Century Aluminum Company
                          Selected Operating Data
                                (Unaudited)
                       SHIPMENTS - PRIMARY ALUMINUM
                              Direct (1)                   Toll
                      -------------------------- --------------------------
                       Metric   (000)             Metric   (000)    (000)
                        Tons    Pounds   $/Pound   Tons    Pounds  Revenue
                      -------- -------- -------- -------- -------- --------
  2010
  2nd Quarter           76,521  168,700 $   1.04   68,058  150,043 $112,523
  1st Quarter           76,653  168,990 $   1.04   68,024  149,968 $109,659
  2009
  2nd Quarter           76,817  169,353 $   0.69   68,876  151,846 $ 72,136
  1st Quarter           97,392  214,712 $   0.72   68,096  150,126 $ 71,048
  (1) Does not include Toll shipments from Nordural Grundartangi

Contacts:
Mike Dildine (media)
831-642-9364

Shelly Lair (investors)
831-642-9357


SOURCE: Century Aluminum Company


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