February 23, 2012

Century Reports 2011 Financial Results

MONTEREY, CA -- (MARKET WIRE) -- 02/23/12 -- Century Aluminum Company (NASDAQ: CENX) reported a net loss of $31.1 million ($0.35 per basic and diluted common share) for the fourth quarter of 2011. Financial results were positively impacted by an unrealized gain on forward contracts of $2.4 million primarily related to the mark to market of aluminum price protection options. Cost of sales for the quarter included a $6.3 million charge for lower of cost or market inventory adjustments.

For the fourth quarter of 2010, the company reported net income of $65.3 million ($0.65 per basic and $0.64 per diluted common share). Financial results were negatively impacted by an unrealized loss on forward contracts of $5.6 million primarily related to the mark to market of aluminum price protection options and by a contractual termination pension benefit charge of $4.6 million due to the continued curtailment of the Ravenswood facility. Changes to the Century of West Virginia retiree medical benefits program increased quarterly results by $56.7 million with an associated discrete tax benefit of $2.0 million. Cost of sales for the quarter included a $15.9 million net after-tax charge for the portion of power costs at Hawesville paid by the previous power supplier per the terms of the power agreements.

For 2011, the company reported net income of $11.3 million ($0.11 per basic and diluted common share). Financial results were negatively impacted by a $7.7 million charge in the second quarter related to the contractual impact of changes in the company's Board of Directors and the executive management team, a charge of $2.9 million related to an insurance receivable, and a charge of $0.8 million related to the early retirement of debt. Changes to the Century of West Virginia retiree medical benefits program increased results by $18.3 million with an associated discrete tax benefit of $4.2 million. An unrealized gain on forward contracts, primarily related to the mark to market of aluminum price protection options, positively impacted results by $0.8 million. Cost of sales included an $8.6 million charge related to the restart of a curtailed potline at the Hawesville, KY smelter, and a $19.8 million charge for lower of cost or market inventory adjustments.

For 2010, the company reported net income of $60.0 million ($0.59 per basic and diluted common share). Financial results were negatively impacted by an unrealized loss on forward contracts of $10.0 million primarily related to the mark to market of aluminum price protection options and by a contractual termination pension benefit charge of $4.6 million due to the continued curtailment of the Ravenswood facility. Changes to the Century of West Virginia retiree medical benefits program increased results by $56.7 million with an associated discrete tax benefit of $2.0 million. Tax benefits related to the release of tax reserves no longer required positively impacted results by $2.1 million. Cost of sales included a $63.2 million net after-tax charge for the portion of power costs at Hawesville paid by the previous power supplier per the terms of the power agreements.

Sales for the fourth quarter of 2011 were $318.2 million compared with $316.9 million for the fourth quarter of 2010. Shipments of primary aluminum for the 2011 fourth quarter were 155,649 tonnes compared with 148,923 tonnes shipped in the year-ago quarter. Sales for 2011 were $1,356 million compared with $1,169 million for 2010, and total 2011 primary aluminum shipments of 602,142 tonnes compared with 585,395 tonnes shipped in 2010.

"We continue to see generally favorable conditions in our markets," commented Michael Bless, President and Chief Executive Officer. "Trends in end customer demand remain good across a range of key segments. In the U.S., physical premiums remain supportive and interest in higher margin specialty products continues to be strong. The increase in large-user power costs, pervasive across developed economies, is a serious ongoing challenge which is threatening the long-term competitiveness of what would otherwise be very good businesses. We are spending considerable effort to address this challenge to our U.S. smelters. Broader market conditions remain volatile, and will continue to be sensitive to, amongst other developments, the environment in the Eurozone and in the Chinese economy. With this background, we plan to invest in 2012 in growing and improving our businesses, while continuing to prepare for reasonable contingencies.

"We are pleased with the Company's recent performance," continued Bless. "Though we always expect continuing improvement, safety trends have been gratifying these last few months; the Board and I would like to acknowledge the efforts of all employees toward this, our first priority. As forecast, Hawesville returned to near full production by year-end. Key performance indicators have continued to improve, conversion costs have fallen, metal quality has improved and fourth quarter production was up 12 percent versus the third quarter. Across our businesses, we have begun to see some abatement in the recent significant increases in raw material costs. In Iceland, Grundartangi had an excellent quarter, and has fully recovered from the temporary instability caused by the power interruption in early January. In late December, we received the ruling related to the arbitration with one of the power suppliers for the new plant at Helguvik. The ruling was generally favorable to Nordural and we are now in discussions with both power suppliers aimed at reaching, over the next several months, final agreements which will allow us to recommence major project activity."

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

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 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, including, without limitation, declines in aluminum prices or increases in our operating costs; deterioration of global or local financial and economic conditions; additional delays in the completion of our Helguvik, Iceland smelter, including our ability to secure a reliable power supply and our ability to successfully manage and/or improve performance at each of our operating smelters. Forward-looking statements in this press release include, without limitation, statements regarding future market and economic conditions, including the continuance of demand, pricing and cost trends in the aluminum market; our plans to invest in and grow our business in 2012; and our ability reach final agreements with the power suppliers to our Helguvik, Iceland smelter and recommence major project activity. 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          Year ended

                                  December 31,            December 31,

                             ----------------------  ----------------------

                                2011        2010        2011        2010

                             ----------  ----------  ----------  ----------

NET SALES:

  Third-party customers      $  193,992  $  205,547  $  791,993  $  755,863

  Related parties               124,172     111,304     564,431     413,408

                             ----------  ----------  ----------  ----------

                                318,164     316,851   1,356,424   1,169,271



COST OF GOODS SOLD              331,796     275,716   1,266,902   1,056,875

                             ----------  ----------  ----------  ----------



GROSS PROFIT (LOSS)             (13,632)     41,135      89,522     112,396



OTHER OPERATING EXPENSES

 (INCOME) - NET                   4,624     (49,591)     (3,806)    (37,386)

SELLING, GENERAL AND

 ADMINISTRATIVE EXPENSES          8,916      11,101      46,032      46,802

                             ----------  ----------  ----------  ----------



OPERATING INCOME (LOSS)         (27,172)     79,625      47,296     102,980



INTEREST EXPENSE - THIRD

 PARTY - NET                     (5,934)     (6,171)    (24,791)    (25,010)

INTEREST INCOME - RELATED

 PARTY                               61         115         303         448

NET GAIN (LOSS) ON FORWARD

 CONTRACTS                        3,067      (5,681)        804     (10,495)

OTHER INCOME (EXPENSE) - NET        225        (598)     (1,373)       (377)

                             ----------  ----------  ----------  ----------



INCOME (LOSS) BEFORE INCOME

 TAXES AND EQUITY

IN EARNINGS OF JOINT

 VENTURES                       (29,753)     67,290      22,239      67,546



INCOME TAX EXPENSE               (2,213)     (2,803)    (14,359)    (11,133)

                             ----------  ----------  ----------  ----------



INCOME (LOSS) BEFORE EQUITY

 IN EARNINGS OF JOINT

 VENTURES                       (31,966)     64,487       7,880      56,413



EQUITY IN EARNINGS OF JOINT

 VENTURES                           859         793       3,445       3,558

                             ----------  ----------  ----------  ----------



NET INCOME (LOSS)            $  (31,107) $   65,280  $   11,325  $   59,971

                             ==========  ==========  ==========  ==========



Net Income (Loss) Allocated

 to Common Shareholders      $  (31,107) $   59,939  $   10,404  $   55,046



EARNINGS (LOSS) PER COMMON

 SHARE

  Basic                      $    (0.35) $     0.65  $     0.11  $     0.59

  Diluted                    $    (0.35) $     0.64  $     0.11  $     0.59



WEIGHTED AVERAGE COMMON

 SHARES OUTSTANDING

  Basic                          89,352      92,742      91,854      92,676

  Diluted                        89,352      93,414      92,257      92,302










                          Century Aluminum Company

                        Consolidated Balance Sheets

                           (Dollars in Thousands)

                                (Unaudited)





                                                 December 31,  December 31,

ASSETS                                               2011          2010

                                                 ------------  ------------

Current Assets:

   Cash and cash equivalents                     $    183,401  $    304,296

   Restricted cash                                          -         3,673

   Accounts receivable - net                           47,647        43,903

   Due from affiliates                                 44,665        51,006

   Inventories                                        171,961       155,908

   Prepaid and other current assets                    40,646        18,292

                                                 ------------  ------------

     Total current assets                             488,320       577,078

Property, plant and equipment - net                 1,218,225     1,256,970

Due from affiliates - less current portion                  -         6,054

Other assets                                          104,549        82,954

                                                 ------------  ------------

     Total                                       $  1,811,094  $  1,923,056

                                                 ============  ============



LIABILITIES AND SHAREHOLDERS' EQUITY

Current Liabilities:

   Accounts payable, trade                       $     86,172  $     88,004

   Due to affiliates                                   41,904        45,381

   Accrued and other current liabilities               40,776        41,495

   Accrued employee benefits costs - current

    portion                                            16,698        26,682

   Convertible senior notes                                 -        45,483

   Industrial revenue bonds                             7,815         7,815

                                                 ------------  ------------

     Total current liabilities                        193,365       254,860

                                                 ------------  ------------



Senior notes payable                                  249,512       248,530

Accrued pension benefits costs - less current

 portion                                               70,899        37,795

Accrued postretirement benefits costs - less

 current portion                                      128,078       103,744

Other liabilities                                      40,005        37,612

Deferred taxes                                         90,958        85,999

                                                 ------------  ------------

     Total noncurrent liabilities                     579,452       513,680

                                                 ------------  ------------



Shareholders' Equity:

   Series A preferred stock (one cent par value,

    5,000,000 shares authorized; 80,718 and

    82,515 shares issued and outstanding at

    December 31, 2011 and December 31, 2010,

    respectively)                                           1             1

   Common stock (one cent par value, 195,000,000

    shares authorized; 93,230,848 issued and

    88,844,327 outstanding as of December 31,

    2011; 92,771,864 shares issued and

    outstanding as of December 31, 2010)                  932           928

   Additional paid-in capital                       2,506,842     2,503,907

   Treasury stock, at cost                            (45,891)            -

   Accumulated other comprehensive loss              (134,588)      (49,976)

   Accumulated deficit                             (1,289,019)   (1,300,344)

                                                 ------------  ------------

     Total shareholders' equity                     1,038,277     1,154,516

                                                 ------------  ------------

     Total                                       $  1,811,094  $  1,923,056

                                                 ============  ============










                          Century Aluminum Company

                   Consolidated Statements of Cash Flows

                           (Dollars in Thousands)

                                (Unaudited)





                                                         Year ended

                                                        December 31,

                                                 --------------------------

                                                     2011          2010

                                                 ------------  ------------

CASH FLOWS FROM OPERATING ACTIVITIES:

  Net income                                     $     11,325  $     59,971

  Adjustments to reconcile net income to net

   cash provided by (used in) operating

   activities:

     Unrealized net (gain) loss on forward

      contracts                                          (750)       10,030

     Realized benefit of contractual receivable             -        55,703

     Accrued and other plant curtailment costs -

      net                                             (13,928)      (56,010)

     Lower of cost or market inventory

      adjustment                                       19,766          (426)

     Depreciation and amortization                     62,194        63,550

     Debt discount amortization                         1,857         3,150

     Deferred income taxes                              2,494        15,552

     Pension and other postretirement benefits        (28,757)       14,578

     Stock-based compensation                           2,856         1,905

     Non-cash loss on early extinguishment of

      debt                                                763             -

     Non-cash contingent obligation                         -        13,091

     Undistributed earnings of joint ventures          (3,445)       (3,558)

     Change in operating assets and liabilities:

         Accounts receivable - net                     (3,744)       (6,197)

         Due from affiliates                           10,694       (38,191)

         Inventories                                  (35,819)      (24,009)

         Prepaid and other current assets             (20,791)       13,412

         Accounts payable, trade                         (904)       11,674

         Due to affiliates                             (3,477)       12,685

         Accrued and other current liabilities            425        (1,758)

         Other - net                                   (3,695)      (13,642)

                                                 ------------  ------------

     Net cash provided by (used in) operating

      activities                                       (2,936)      131,510

                                                 ------------  ------------



CASH FLOWS FROM INVESTING ACTIVITIES:

  Purchase of property, plant and equipment           (20,100)      (12,241)

  Nordural expansion                                  (12,882)      (19,227)

  Investments in and advances to joint ventures          (113)          (32)

  Payment received on advances from joint

   ventures                                             3,056             -

  Proceeds from sale of property, plant and

   equipment                                            1,471           823

  Restricted and other cash deposits                    3,673         5,206

                                                 ------------  ------------

       Net cash used in investing activities          (24,895)      (25,471)

                                                 ------------  ------------



CASH FLOWS FROM FINANCING ACTIVITIES:

  Repayment of debt                                   (47,067)            -

  Repayment of contingent obligation                     (189)            -

  Borrowing under revolving credit facility            15,900             -

  Repayment under revolving credit facility           (15,900)            -

  Repurchase of common stock                          (45,891)            -

  Issuance of common stock - net                           83            23

                                                 ------------  ------------

       Net cash provided by (used in) financing

        activities                                    (93,064)           23

                                                 ------------  ------------



CHANGE IN CASH AND CASH EQUIVALENTS                  (120,895)      106,062



CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR          304,296       198,234

                                                 ------------  ------------



CASH AND CASH EQUIVALENTS, END OF YEAR           $    183,401  $    304,296

                                                 ============  ============







                          Century Aluminum Company

                           Selected Operating Data

                                 (Unaudited)



                        SHIPMENTS - PRIMARY ALUMINUM



                           Direct (1)                       Toll

                 ----------------------------- -----------------------------

                   Metric    (000)               Metric    (000)     (000)

                    Tons     Pounds   $/Pound     Tons     Pounds   Revenue

                 --------- --------- --------- --------- --------- ---------

2011

4th Quarter         87,665   193,269 $    1.06    67,984   149,877 $ 112,411

3rd Quarter         82,236   181,299      1.19    68,596   151,229   129,369

2nd Quarter         84,509   186,310      1.26    66,974   147,652   132,113

1st Quarter         80,479   177,426      1.17    63,699   140,432   117,658

                 --------- --------- --------- --------- --------- ---------

Total              334,889   738,304 $    1.17   267,253   589,190 $ 491,551

                 --------- --------- --------- --------- --------- ---------



2010

4th Quarter         83,073   183,145 $    1.10    65,850   145,172 $ 114,513

3rd Quarter         81,693   180,102      0.99    65,523   144,454   100,231

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

                 --------- --------- --------- --------- --------- ---------

Total              317,940   700,937 $    1.04   267,455   589,637 $ 436,926

                 --------- --------- --------- --------- --------- ---------



(1) Does not include Toll shipments from Nordural Grundartangi

Contacts:

Lindsey Berryhill (media)

831-642-9364



Shelly Harrison (investors)

831-642-9357



Source: Century Aluminum Company

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