Century Reports First Quarter 2012 Results
Century Aluminum Company
Century Reports First Quarter 2012 Results
MONTEREY, CA--(Marketwire - April 24, 2012) - Century Aluminum Company (NASDAQ:
CENX) reported a net loss of $3.9 million ($0.04 per basic and diluted common
share) for the first quarter of 2012. 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.
For the first quarter of 2011, Century reported net income of $25.0 million
($0.25 per basic and diluted common share). Financial results were negatively
impacted by an unrealized loss on forward contracts of $4.7 million primarily
related to the mark to market of aluminum price protection options. Changes to
the Century of West Virginia retiree medical benefits program increased
quarterly results by $9.4 million with an associated discrete tax benefit of
$2.1 million. Cost of sales for the quarter included a $6.4 million charge for
the restart of a curtailed potline at the Hawesville, Kentucky smelter.
Sales for the first quarter of 2012 were $326.2 million, compared with $326.3
million for the first quarter of 2011. Shipments of primary aluminum for the
2012 first quarter were 159,967 tonnes, compared with 144,178 tonnes shipped in
the year-ago quarter.
"The macroeconomic picture continues to defy a simple characterization,"
commented Michael A. Bless, President and Chief Executive Officer. "While the
pace of end demand growth in key developing markets has slowed, absolute
conditions remain reasonable. Given the risk of shock from the Eurozone,
coupled with tight financing markets, we continue to note that customers remain
wary of making long-term commitments. The aluminum price has been trading at a
level that, in our opinion, is not sustainable. While the industry has seen
some abatement in the cost of commodity raw materials, the price of electric
power in most developed and developing markets renders a significant amount of
existing capacity marginally economic or worse. Addressing this issue, over the
short- and longer-term, will determine the longevity of a meaningful portion of
our industry's existing capacity.
"Century has executed well in this environment," continued Bless. "Our safety
performance has been good; importantly, we are making progress on changing the
manner in which we think about safe and environmentally sound operations.
Hawesville continues at effective full production; as predicted, conversion
costs have improved. We are spending significant effort aimed at the uneconomic
cost of the plant's electric power. The process supporting the potential
restart of Ravenswood is on track; while significant work remains, we are
optimistic about the prospects of restarting this plant. Grundartangi had an
excellent quarter; the team was able to make up for the modest production lost
during the serious power outage in January. Regarding Helguvik, during the next
few months, we will have several critical discussions which will determine the
timing of the restart of major project activity."
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.
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. 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 and the addition of new or restarted global aluminum production
capacity; additional delays in the completion of our Helguvik, Iceland smelter;
and our ability to successfully progress the potential restart of our
Ravenswood smelter. Forward-looking statements in this press release include,
without limitation, statements regarding future aluminum prices, future
industry production capacity and power rates, our ability to successfully
progress the potential restart of our Ravenswood smelter and restart major
construction activity at Helguvik. 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.