Century Reports First Quarter 2013 Results

MONTEREY, CA -- (Marketwired) -- 04/25/13 -- Century Aluminum Company (NASDAQ: CENX) reported net income of $8.3 million ($0.09 per basic and diluted common share) for the first quarter of 2013. Financial results were positively impacted by a litigation reserve adjustment of $2.2 million and an unrealized gain of $15.7 million related to a LME-based contingent obligation. Results were negatively impacted by severance and other expenses of $2.2 million related to our corporate headquarters relocation. Cost of sales for the quarter included a $5.8 million charge for lower of cost or market inventory adjustments.

For the first quarter of 2012, Century reported a net loss of $4.4 million ($0.05 per basic and diluted common share). Financial results were negatively impacted by an unrealized loss on forward contracts of $5.0 million primarily related to the mark to market of aluminum price protection options. Cost of sales for the quarter included a $17.1 million benefit for lower of cost or market inventory adjustments.

Sales for the first quarter of 2013 were $321.3 million, compared with $326.2 million for the first quarter of 2012. Shipments of primary aluminum for the 2013 first quarter were 158,776 tonnes, compared with 159,967 tonnes shipped in the year-ago quarter.

"Market volatility has increased due to a number of factors," commented Michael Bless, President and Chief Executive Officer. "Economic data from China have been mixed, with underlying industrial and consumer activity growing at a reasonable, but slower pace. Growth in other developing economies has also slowed and conditions in the Eurozone remain difficult. In the U.S., end markets remain generally strong. Overall, we continue to expect medium and longer-term global trends to be favorable, and are thus executing our strategic plans. We are, however, working to preserve considerable flexibility in the present uncertain environment."

Mr. Bless continued, "We continue to discuss with Hawesville's electric power provider an arrangement for supply after the termination of the existing contract in August. Given that we have yet to reach an agreement, we recently deemed it necessary to issue a termination notice to the plant's largest customer and notifications under the WARN Act to our employees. We remain optimistic that a solution exists that would support the plant's continued operation and would have, at worst, no impact on any other rate payer in Kentucky. I am proud of our people who have remained dedicated to operating the plant safely and productively during a time of uncertainty. Their efforts, coupled with a market-based power price, will provide the basis for Hawesville to operate for many years to come.

"We are pushing forward on our other key initiatives," concluded Mr. Bless. "The restart of Ravenswood remains a priority, and we are in discussions with the power provider and other key constituencies aimed at finding a suitable arrangement. For Grundartangi, we are working hard on the two key investment projects, aimed at expanding the plant's capacity and restarting the recently acquired anode plant in the Netherlands. Discussions with the current power suppliers for the new plant at Helguvik have continued, albeit at a slow pace. We are hopeful that a new government, expected as a result of the national elections in Iceland at the end of April, will provide the support necessary to allow a restart of major construction activity; an adequate supply of power and a guarantee of the necessary transmission capacity are the only impediments to a full restart of this attractive project."

Century Aluminum Company owns primary aluminum capacity in the United States and Iceland. Century's corporate offices are located in Monterey, California. More information can be found at www.centuryaluminum.com.

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.

Cautionary Statement
This press release and comments made by Century 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 important 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 increases in our operating costs; worsening of global financial and economic conditions; increases in global aluminum inventories; market volatility and growth in developing economies; variations in sales and consumer demand for aluminum; and our ability to secure competitive long-term power arrangements for our facilities. Forward-looking statements in this press release include, without limitation, statements regarding global economic and financial trends; our ability to successfully access wholesale or market-based power for our Hawesville smelter and achieve an attractive long-term power solution for the plant; our ability to obtain a power arrangement that enables a restart of our Ravenswood smelter; our ability to successfully execute our key investment projects for Grundartangi; and our ability to restart major construction activity at Helguvik and procure a reliable source of power. 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.

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

CENTURY ALUMINUM COMPANY
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands, except per share amounts)
(Unaudited)
			Three months ended
			March 31,
			2013				2012
NET SALES:
	Third-party customers		$	188,514			$	188,839
	Related parties			132,760				137,351
				321,274				326,190
	Cost of goods sold			303,692				305,598
Gross profit				17,582				20,592
	Other operating expenses - net			1,096				3,721
	Selling, general and administrative expenses			16,299				8,459
Operating income				187				8,412
	Interest expense - third party - net			(5,945	)			(5,840	)
	Interest income - related parties			-				60
	Net gain (loss) on forward and derivative contracts			15,507				(5,159	)
	Other income - net			70				306
Income (loss) before income taxes and equity in earnings of joint ventures				9,819				(2,221	)
	Income tax expense			(2,517	)			(2,821	)
Income (loss) before equity in earnings of joint ventures				7,302				(5,042	)
	Equity in earnings of joint ventures			951				641
Net income (loss)			$	8,253			$	(4,401	)
Net income (loss) allocated to common shareholders			$	7,567			$	(4,401	)
EARNINGS (LOSS) PER COMMON SHARE:
	Basic and Diluted		$	0.09			$	(0.05	)
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
	Basic			88,555				88,727
	Diluted			89,020				88,727

CENTURY ALUMINUM COMPANY
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except share data)
(Unaudited)
			March 31,				December 31,
ASSETS			2013				2012
Cash and cash equivalents			$	195,471			$	183,976
Restricted cash				258				258
Accounts receivable - net				52,312				50,667
Due from affiliates				43,561				37,870
Inventories				156,815				159,925
Prepaid and other current assets				41,163				34,975
Deferred taxes - current portion				19,726				19,726
	Total current assets			509,306				487,397
Property, plant and equipment - net				1,180,770				1,188,214
Other assets				101,039				100,715
	TOTAL		$	1,791,115			$	1,776,326
LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES:
Accounts payable, trade			$	75,796			$	75,370
Due to affiliates				50,210				39,737
Accrued and other current liabilities				49,001				40,099
Accrued employee benefits costs - current portion				18,668				18,683
Industrial revenue bonds				7,815				7,815
	Total current liabilities			201,490				181,704
Senior notes payable				250,861				250,582
Accrued pension benefits costs - less current portion				67,322				67,878
Accrued postretirement benefits costs - less current portion				143,794				143,105
Other liabilities				25,278				40,162
Deferred taxes				110,361				110,252
	Total noncurrent liabilities			597,616				611,979
SHAREHOLDERS' EQUITY:
Series A Preferred stock (one cent par value, 5,000,000 shares authorized; 80,084 and 80,283 issued and outstanding at March 31, 2013 and December 31, 2012, respectively)				1				1
Common stock (one cent par value, 195,000,000 shares authorized; 93,382,730 issued and 88,596,209 outstanding at March 31, 2013; 93,335,158 issued and 88,548,637 outstanding at December 31, 2012)				934				933
Additional paid-in capital				2,507,671				2,507,454
Treasury stock, at cost				(49,924	)			(49,924	)
Accumulated other comprehensive loss				(150,297	)			(151,192	)
Accumulated deficit				(1,316,376	)			(1,324,629	)
	Total shareholders' equity			992,009				982,643
	TOTAL		$	1,791,115			$	1,776,326

CENTURY ALUMINUM COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in thousands)
(Unaudited)
					Three months ended
					March 31,
					2013				2012
CASH FLOWS FROM OPERATING ACTIVITIES:
	Net income (loss)				$	8,253			$	(4,401	)
	Adjustments to reconcile net income (loss) to net cash provided by operating activities:
		Unrealized net (gain) loss on forward contracts				(141	)			4,955
		Unrealized gain on E.ON contingent obligation				(15,722	)			-
		Accrued and other plant curtailment costs - net				1,154				1,374
		Lower of cost or market inventory adjustment				5,838				(17,051	)
		Depreciation				15,688				15,652
		Debt discount amortization				279				256
		Pension and other postretirement benefits				1,443				(1,138	)
		Stock-based compensation				217				145
		Undistributed earnings of joint ventures				(951	)			(641	)
		Change in operating assets and liabilities:
			Accounts receivable - net			(1,998	)			(2,884	)
			Due from affiliates			(5,691	)			(249	)
			Inventories			(2,728	)			18,710
			Prepaid and other current assets			(6,072	)			(5,366	)
			Accounts payable, trade			2,264				(11,442	)
			Due to affiliates			10,472				(360	)
			Accrued and other current liabilities			7,538				7,003
			Other - net			2,558				335
Net cash provided by operating activities						22,401				4,898
CASH FLOWS FROM INVESTING ACTIVITIES:
	Purchase of property, plant and equipment					(9,364	)			(2,899	)
	Nordural expansion - Helguvik					(1,745	)			(1,946	)
	Purchase of carbon anode assets and improvements					(150	)			-
	Investments in and advances to joint ventures					-				(100	)
	Dividends and payments received on advances from joint ventures					-				3,166
	Proceeds from sale of property, plant and equipment					353				58
Net cash used in investing activities						(10,906	)			(1,721	)
CASH FLOWS FROM FINANCING ACTIVITIES:
	Borrowings under revolving credit facility					-				18,076
	Repayments under revolving credit facility					-				(18,076	)
	Repurchase of common stock					-				(4,033	)
Net cash used in financing activities						-				(4,033	)
CHANGE IN CASH AND CASH EQUIVALENTS						11,495				(856	)
Cash and cash equivalents, beginning of period						183,976				183,401
Cash and cash equivalents, end of period					$	195,471			$	182,545

Century Aluminum Company
Selected Operating Data
(Unaudited)
SHIPMENTS - PRIMARY ALUMINUM
		Direct (1)						Toll
				(000)						(000)		$ (000)
		Tonnes		Pounds		$/Pound		Tonnes		Pounds		Revenue
2013
1st Quarter		93,472		206,070		1.06		65,304		143,971		103,973
2012
1st Quarter		94,087		207,426		1.06		65,880		145,240		106,416
(1) Does not include Toll shipments from Nordural Grundartangi

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

Shelly Harrison (investors):
831-642-9357

Source: Century Aluminum Company

News Provided by Acquire Media

Close window | Back to top

• delicious
• Digg
• Facebook
• LinkedIn
• Twitter