Century Reports Third Quarter 2004 Financial Results.MONTEREY Monterey (mŏntərā`), city (1990 pop. 31,954), Monterey co., W Calif., a port on Monterey Bay; founded 1770, inc. 1850. It is a popular resort, the home of many artists and writers, and one of California's oldest cities. , Calif. -- Century Aluminum Company (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :CENX) reported that a one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. , after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. charge of $30.6 million for refinancing Refinancing An extension and/or increase in amount of existing debt. debt offset strong operating earnings Operating Earnings Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before , resulting in a net loss of $16.0 million, or $.51 a common share, for the third quarter of 2004. For the third quarter of 2003, the company reported a net loss of $5.4 million, or $0.28 a common share after preferred dividends preferred dividend n. a payment of a corporation's profits to holders of preferred shares of stock. (See: preferred stock) . Quarterly Highlights --Operating income was $35.8 million, a six-fold Adj. 1. six-fold - having six units or components sextuple, sixfold multiple - having or involving or consisting of more than one part or entity or individual; "multiple birth"; "multiple ownership"; "made multiple copies of the speech"; "his multiple increase over the year-ago quarter. --Domestic debt was refinanced, lowering the company's borrowing rate from 11-3/4% to slightly over 5%, extending maturities and creating greater flexibility for the company. The one-time cost of tendering for the $325 million in notes due 2008 was $30.6 million after tax, or $0.96 a share. --Sales and aluminum shipments were quarterly records. Sales for the third quarter of 2004 were $274.3 million compared with $201.5 million for the third quarter of 2003. Total shipments of primary aluminum for the 2004 third quarter were 344.2 million pounds, compared with 292.6 million pounds for the year-ago quarter. Net income for the first nine months of 2004 was $7.0 million, or $0.23 a common share after preferred dividends. This compares with net income of $7.2 million, or $0.27 a common share after preferred dividends, for the 2003 period. Sales in the first nine months of 2004 were $770.1 million, compared with $576.7 million for the year-ago period. Total shipments of primary aluminum for the 2004 period were 971.4 million pounds versus 839.6 million pounds for the year-ago period. Financial results for 2004 include Nordural from April 27, 2004, the date of acquisition. Commenting on the company's performance, Craig Craig , Edward Gordon 1872-1966. British theatrical producer, director, and designer whose innovative productions and simplified stage designs influenced modern theater. A. Davis, chairman and chief executive officer, said: "Our overall performance in the recent quarter benefited from favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. metal prices and our first full-quarter ownership of our Nordural Operations in Iceland Iceland, Icel. Ísland, officially Republic of Iceland, republic (2005 est. pop. 297,000), 39,698 sq mi (102,819 sq km), the westernmost state of Europe, occupying an island in the Atlantic Ocean just S of the Arctic Circle, c. . We refinanced our high-cost, long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. with lower cost debt that will produce substantial savings in interest and puts the company in a much stronger position. Cash flow remains very strong, and we prepaid pre·pay tr.v. pre·paid, pre·pay·ing, pre·pays To pay or pay for beforehand. pre·pay  ment n. $100 million of Nordural debt."Our costs increased principally due to the replacement of more reduction cells than anticipated, fuel surcharges at the Mt. Holly holly, common name for members of the Aquifoliaceae, a family of widely distributed trees and shrubs, most numerous in Central and South America. The evergreen English holly (Ilex aquifolium , SC reduction plant, and administrative expenses relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc acquisitions, financings and Sarbanes-Oxley compliance. "On October October: see month. 1, 2004, we completed the acquisition of a 50-percent interest in an alumina alumina (əl  `mĭnə) or aluminum oxide, Al2O3, chemical compound with m.p. about 2,000°C; and sp. gr. about 4.0. refinery in Gramercy gra·mer·cy interj. Archaic Used to express surprise or gratitude. [Middle English gramerci, from Old French grand merci : grand, great; see grand + , LA, and related bauxite bauxite (bôk`sīt, bŏk`–), mixture of hydrated aluminum oxides usually containing oxides of iron and silicon in varying quantities. assets in Jamaica Jamaica (jəmā`kə), independent state within the Commonwealth (2005 est. pop. 2,732,000), 4,232 sq mi (10,962 sq km), coextensive with the island of Jamaica, West Indies, S of Cuba and W of Haiti. . These assets were placed on sale by Kaiser Aluminum Kaiser Aluminum (NASDAQ: KALU) is an American aluminum producer. The company was founded in 1946 by American industrialist Henry J. Kaiser. Kaiser entered the aluminum business by purchasing two government-owned aluminum facilities in Washington state. & Chemical Corp. as part of its plan for emerging from bankruptcy bankruptcy, in law, settlement of the liabilities of a person or organization wholly or partially unable to meet financial obligations. The purposes are to distribute, through a court-appointed receiver, the bankrupt's assets equitably among creditors and, in most . The acquisition ensures the continued supply of alumina to our Hawesville, KY reduction plant." Century owns 615,000 metric tons (Transparent Optical Networking Services) A marketing term for providing dark fiber to a customer. The customer is responsible for generating the transmission signal and interpreting it at the other end. See dark fiber. per year (mtpy mtpy Metric Tons Per Year ) of primary aluminum capacity. The company owns and operates a 244,000-mtpy plant at Hawesville, KY, a 170,000-mtpy plant at Ravenswood Ravenswood may refer to: Film & Literature
U.S. company, the world's largest producer of aluminum. Established in Pittsburgh, Pa., in 1888, it adopted the name Aluminum Co. of America in 1907. Alcoa introduced aluminum foil in 1910 and found uses for aluminum in the emerging aviation and automobile industries. Inc. owns the remainder and is the operating partner. Century's corporate offices are located in Monterey, CA. Forward Looking Statements This press release may contain "forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. " within the meaning of U.S. federal securities laws. Century 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 Century'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 Century's filings with the Securities and Exchange Commission. Century 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 CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or 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 Nine months ended
September 30, September 30,
------------------- -------------------
2004 2003 2004 2003
--------- --------- --------- ---------
NET SALES:
Third-party customers $231,502 $170,086 $649,278 $487,287
Related parties 42,815 31,402 120,866 89,377
--------- --------- --------- ---------
274,317 201,488 770,144 576,664
COST OF GOODS SOLD 230,948 191,448 644,535 551,142
--------- --------- --------- ---------
GROSS PROFIT 43,369 10,040 125,609 25,522
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES 7,567 3,929 16,966 12,150
--------- --------- --------- ---------
OPERATING INCOME 35,802 6,111 108,643 13,372
INTEREST INCOME (EXPENSE) -
Net (10,140) (11,258) (32,028) (32,616)
NET GAIN (LOSS) ON FORWARD
CONTRACTS (3,149) (3,481) (17,146) 38,423
LOSS ON EARLY EXTINGUISHMENT
OF DEBT (47,448) - (47,448) -
OTHER INCOME (EXPENSE) (4) (10) (609) (510)
--------- --------- --------- ---------
INCOME (LOSS) BEFORE INCOME
TAXES (24,939) (8,638) 11,412 18,669
INCOME TAX (EXPENSE) BENEFIT 8,890 3,271 (4,373) (6,556)
--------- --------- --------- ---------
INCOME (LOSS) BEFORE MINORITY
INTEREST AND CUMULATIVE
EFFECT OF CHANGE IN
ACCOUNTING PRINCIPLE (16,049) (5,367) 7,039 12,113
MINORITY INTEREST - - - 986
--------- --------- --------- ---------
INCOME (LOSS) BEFORE
CUMULATIVE EFFECT OF
CHANGE IN ACCOUNTING
PRINCIPLE (16,049) (5,367) 7,039 13,099
CUMULATIVE EFFECT OF CHANGE IN
ACCOUNTING PRINCIPLE, NET OF
TAX BENEFIT OF $3.4 MILLION - - - (5,878)
--------- --------- --------- ---------
NET INCOME (LOSS) (16,049) (5,367) 7,039 7,221
PREFERRED DIVIDENDS - (500) (769) (1,500)
--------- --------- --------- ---------
NET INCOME (LOSS) APPLICABLE
TO COMMON SHAREHOLDERS $(16,049) $(5,867) $6,270 $5,721
========= ========= ========= =========
EARNINGS (LOSS) PER COMMON
SHARE
Basic - Before cumulative
effect of change in
accounting principle $(0.51) $(0.28) $0.23 $0.55
Basic - Cumulative effect
of change in accounting
principle $ - $ - $ - $(0.28)
--------- --------- --------- ---------
Basic - Net income (loss) $(0.51) $(0.28) $0.23 $0.27
========= ========= ========= =========
Diluted - Before
cumulative effect of
change in accounting
principle $(0.51) $(0.28) $0.23 $0.55
Diluted - Cumulative
effect of change in
accounting principle $ - $ - $ - $(0.28)
--------- --------- --------- ---------
Diluted - Net income
(loss) $(0.51) $(0.28) $0.23 $0.27
========= ========= ========= =========
WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING
Basic 31,754 21,070 27,542 21,070
Diluted 31,754 21,070 27,659 21,074
See Notes to Consolidated Statements of Operations
Century Aluminum Company
Notes to Consolidated Statements of Operations
(in Thousands, Except Per Share Amounts)
(Unaudited)
2004
----
Cost of Goods Sold includes a year to date credit of $2,273 for net
Lower of Cost or Market (LCM) inventory adjustments.
2003
----
Cost of Goods Sold includes a credit of $1,223 and $1,617 for net LCM
inventory adjustments in the quarter and year to date respectively.
Cost of Goods Sold includes a charge of $1,555 for the quarter and
year to date for additional costs associated with spot purchases of
alumina due to a supplier production curtailment
Century Aluminum Company
Consolidated Balance Sheets
(Dollars in Thousands)
(Unaudited)
Sept. 30, Dec. 31,
ASSETS 2004 2003
------------------------
Current Assets:
Cash $76,474 $28,204
Restricted cash 1,675 -
Accounts receivable - net 70,478 51,370
Due from affiliates 12,094 10,957
Inventories 102,652 89,360
Prepaid and other assets 8,896 4,101
Deferred taxes - current portion 12,796 3,413
------------------------
Total current assets 285,065 187,405
Property, Plant and Equipment - Net 754,207 494,957
Intangible Asset - Net 89,891 99,136
Goodwill 107,259 -
Other Assets 37,976 28,828
------------------------
Total $1,274,398 $810,326
========================
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable, trade $52,607 $34,829
Due to affiliates 57,702 27,139
Accrued and other current liabilities 44,237 30,154
Accrued employee benefits costs - current
portion 8,295 8,934
Convertible senior notes 175,000 -
Industrial revenue bonds 7,815 7,815
Long term debt - current portion 5,945 -
------------------------
Total current liabilities 351,601 108,871
Senior Secured Notes Payable - Net 9,874 322,310
Senior Unsecured Notes Payable 250,000 -
Nordural Debt 77,425 -
Note Payable - Affiliates - 14,000
Accrued Pension Benefit Costs - Less current
portion 12,003 10,764
Accrued Postretirement Benefits Costs - Less
current portion 84,871 78,218
Other Liabilities 34,879 33,372
Due to Affiliates - Less current portion 9,978 -
Deferred Taxes 57,610 55,094
------------------------
Total noncurrent liabilities 536,640 513,758
Shareholders' Equity:
Convertible Preferred Stock (8.0%
cumulative, 0 and 500,000 shares
outstanding at September 30, 2004
and December 31, 2003, respectively) - 25,000
Common Stock (one cent par value,
50,000,000 shares authorized; 31,986,798
shares outstanding at September 30,
2004 and 21,130,839 at December 31,
2003) 320 211
Additional Paid-In Capital 414,642 173,138
Other Comprehensive Loss (27,103) (5,222)
Accumulated Deficit (1,702) (5,430)
------------------------
Total shareholders' equity 386,157 187,697
------------------------
Total $1,274,398 $810,326
========================
Century Aluminum Company
Consolidated Statements of Cash Flow
(Dollars in Thousands)
(Unaudited)
Nine Months Ended
September 30,
---------------------
2004 2003
---------------------
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income $7,039 $7,221
Adjustments to reconcile net
income to net cash provided
by operating activities:
Unrealized (Gain) Loss on
forward contracts 4,712 (6,974)
Depreciation and
amortization 36,889 38,403
Deferred income taxes (3,965) 3,125
Pension and other
postretirement benefits 7,253 7,592
Inventory market
adjustment (2,273) (1,617)
Loss on disposal of
assets 719 841
Minority Interest - (986)
Cumulative effect of
change in accounting
principle - 9,308
Non-Cash Loss on Early
Extinguishment of Debt 9,659 -
Change in operating
assets and liabilities:
Accounts receivable - net (10,342) (7,170)
Due from affiliates (1,346) (866)
Inventories 966 4,512
Prepaids and other
assets (1,276) (1,046)
Accounts payable,
trade 7,730 101
Due to affiliates 4,606 3,897
Accrued and other
current liabilities 7,850 11,392
Other - net 3,643 10,309
---------------------
Net cash provided by
operating activities 71,864 78,042
CASH FLOWS FROM INVESTING
ACTIVITIES:
Purchase of property, plant
and equipment (8,832) (12,389)
Nordural expansion (17,482) -
Acquisitions (184,869) (59,837)
---------------------
Net cash used in
investing activities (211,183) (72,226)
CASH FLOWS FROM FINANCING
ACTIVITIES:
Borrowings 425,569 -
Repayment of third party debt (422,846) -
Repayment of related party debt (14,000) -
Financing fees (12,805) (297)
Dividends (3,311) (11)
Issuance of common stock 214,982 3
---------------------
Net cash provided by
financing activities 187,589 (305)
NET INCREASE IN CASH 48,270 5,511
CASH, BEGINNING OF PERIOD 28,204 45,092
---------------------
CASH, END OF PERIOD $76,474 $50,603
=====================
Century Aluminum Company
Selected Operating Data
(in Thousands, Except Dollars per Pound)
(Unaudited)
SHIPMENTS - PRIMARY ALUMINUM
Direct (1) Toll
----------------- -----------------
Pounds $/Pound Pounds Revenue
-------- -------- -------- --------
2004
----
3rd Quarter 292,978 $0.83 51,218 $31,095
2nd Quarter 294,816 $0.82 35,600 $21,483
1st Quarter 296,743 $0.78 - -
2003
----
3rd Quarter 292,567 $0.69 - -
2nd Quarter 290,023 $0.68 - -
1st Quarter 257,040 $0.70 - -
(1) Does not include Toll shipments from Nordural
FORWARD PRICED SALES
2005 2006 2007
-------- -------- --------
Pounds 426,729 169,205 177,472
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