Century Reports Third Quarter Net Loss of $0.21 a Share; Loss Includes Inventory Writedown and Insurance Settlements.Business Editors 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.--(BUSINESS WIRE)--Oct. 22, 2001 Century Aluminum Company (Nasdaq:CENX) reported a net loss of $3.8 million for the third quarter of 2001, or $0.21 a share after payment of dividends on preferred shares Preferred shares Preferred shares give investors a fixed dividend from the company's earnings and entitle them to be paid before common shareholders. See: Preferred stock. . This compares with net income of $4.3 million, or $0.21 a share, for the third quarter of 2000. The 2001 third quarter includes an 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. , non-cash charge Non-Cash Charge A charge off, made by a company against earnings, that does not require an initial outlay of cash. Notes: Non-cash charges are typically against the depreciation, amortization, and depletion accounts on a company's balance sheet. of $1.8 million, or $0.09 a share, for lower of cost or market lower of cost or market A method for determining an asset's value such that either the original cost or the current replacement cost, whichever is lowest, is used for financial reporting purposes. inventory writedowns and the receipt of final settlements on two insurance claims equal to $2.1 million, or $0.10 a share, after tax. The year-ago quarter included an after-tax charge of $0.7 million, or $0.03 a share, from marking aluminum commodity contracts to market and an income tax benefit of $1.9 million, or $0.09 a share, from a reduction in estimated income taxes. For the first nine months of 2001 the company recorded net income of $0.7 million, or a loss of $0.02 a share, after payment of dividends on preferred shares. This compares with net income of $16.9 million, or $0.83 a share, for the corresponding period of 2000. Sales in the third quarter of 2001 were $183.4 million versus $111.1 million in the year ago quarter. Sales in the first nine months of 2001 were $483.0 million compared with $316.6 million in the same period of 2000. Shipments of primary aluminum in the 2001 third quarter totaled 259.4 million pounds against 151.2 million pounds a year ago. In the first nine months of 2001, shipments were 663.8 million pounds compared with 428.8 million pounds in the year-ago period. Commenting on the performance, Century Chairman and Chief Executive Craig Davis
Craig “Buster” Davis (born October 2, 1985, in New Orleans, Louisiana) is a wide receiver drafted by the San Diego Chargers. said: "Our financial results for the quarter were disappointing. They reflect the weakness in the aluminum industry that began last year when, in retrospect, the U.S. industrial sector already may have entered the early stages of an economic downturn Downturn The transition point between a rising, expanding economy to a falling, contracting one. downturn A decline in security prices or economic activity following a period of rising or stable prices or activity. . It appears that the tragic events of September September: see month. 11 may have since drawn the U.S. and other major world economies into recession. "We are concerned with the state of the world economy, however, we have structured our company to remain cash-flow positive even at weak metal prices: -- The acquisition of our Hawesville, KY plant in April broadened our portfolio of primary aluminum assets and lowered our average cost of production; -- Starting in 2002, all of our alumina contracts will be indexed to world market prices for primary aluminum, reducing our cash breakeven point; -- Also starting in 2002, a major metal supply contract converts from LME pricing to a fixed price above current levels, further reducing our cash breakeven point. "We remain positive about the underlying fundamentals of aluminum." Century has 465,000 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 capacity at three locations. The company owns 80 percent of and operates the 237,000-mtpy plant at Hawesville, KY. Glencore Glencore International AG (formerly called Marc Rich & Co AG) is one of the world's largest suppliers of commodities and raw materials, and is also among the world's largest privately held companies. As of 2006, it was Europe's sixth-largest company in terms of turnover. owns the remainder. Century owns and operates a 168,000-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 of the Mt. Holly facility and is the operating partner. Century's corporate offices are in Monterey, CA. Note: Century's press releases 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 the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. The company cautions that such forward-looking statements are not guarantees of future performance and involve significant risks and uncertainties. Actual results may vary materially from those expressed or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. in the forward-looking statements as a result of various factors.
Century Aluminum Company
Consolidated Statements of Operations
(in Thousands, Except Per Share Amounts)
(Unaudited)
Three months ended Nine months ended
September 30 September 30
2001 2000 2001 2000
--------- --------- --------- ---------
NET SALES:
Third-party customers $ 156,638 $ 78,419 $ 399,856 $ 223,145
Related parties 26,733 32,684 83,124 93,472
--------- --------- --------- ---------
183,371 111,103 482,980 316,617
COST OF GOODS SOLD 178,459(1) 103,026 453,319(1) 292,500
--------- --------- --------- ---------
GROSS PROFIT 4,912 8,077 29,661 24,117
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES 5,585 3,370 14,511 9,825
--------- --------- --------- ---------
OPERATING INCOME (LOSS) (673) 4,707 15,150 14,292
GAIN ON SALE OF FABRICATING
BUSINESSES -- -- -- 5,156
INTEREST INCOME (EXPENSE)
Net (10,258) 399 (20,249) 1,887
NET GAIN (LOSS) ON FORWARD
CONTRACTS -- (1,116) (176) (641)
OTHER INCOME (EXPENSE) 3,264(2) (127) 3,203(2) 2,738
--------- --------- --------- ---------
INCOME (LOSS) BEFORE
INCOME TAXES (7,667) 3,863 (2,072) 23,432
INCOME TAX BENEFIT (EXPENSE) 3,015 486 1,104 (6,559)
--------- --------- --------- ---------
NET INCOME (LOSS) BEFORE
MINORITY INTEREST (4,652) 4,349 (968) 16,873
MINORITY INTEREST, NET
OF TAX 810 -- 1,620 --
--------- --------- --------- ---------
NET (LOSS) INCOME (3,842) 4,349 652 16,873
PREFERRED DIVIDENDS (500) -- (1,000) --
--------- --------- --------- ---------
NET INCOME (LOSS) AVAILABLE
TO COMMON SHAREHOLDERS $ (4,342) $ 4,349 $ (348) $ 16,873
========= ========= ========= =========
EARNINGS PER COMMON SHARE
Basic $ (0.21) $ 0.21 $ (0.02) $ 0.83
Diluted $ (0.21) $ 0.21 $ (0.02) $ 0.83
WEIGHTED AVERAGE COMMON
SHARES OUTSTANDING
Basic 20,513 20,339 20,459 20,339
Diluted 20,513 20,399 20,459 20,405
DIVIDENDS PER COMMON SHARE $ 0.05 $ 0.05 $ 0.15 $ 0.15
(1) Includes a non-cash charge of $2,910 and $3,175 for lower of cost
or market inventory writedowns for the three and nine months ended
September 30, 2001, respectively.
(2) Includes insurance settlements of $3,365.
Century Aluminum Company
Consolidated Balance Sheets
(Dollars in Thousands)
(unaudited)
September 30, December 31,
2001 2000
-------- --------
ASSETS
Current Assets:
Cash $ 32,085 $ 32,962
Accounts receivable, trade net 61,170 31,119
Due from affiliates 21,678 15,672
Inventories 73,748 44,081
Prepaid and other assets 7,843 9,487
-------- --------
Total current assets 196,524 133,321
Property, Plant and Equipment - net 428,041 184,526
Intangible Asset 151,845 --
Due from affiliates - Less current portion 10,733 --
Other Assets 32,931 15,923
-------- --------
Total $820,074 $333,770
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable, trade $ 47,104 $ 30,072
Due to affiliates 1,614 3,985
Industrial Revenue Bond 7,815 --
Accrued and other
current liabilities 43,865 17,739
Accrued employee benefits
costs - current portion 6,106 4,824
-------- --------
Total current liabilities 106,504 56,620
Long Term Debt 321,352 --
Accrued Pension Benefit Costs
- Less current portion 4,040 3,656
Accrued Postretirement Benefit Costs
- Less current portion 64,808 42,170
Other Liabilities 10,871 6,560
Deferred Taxes 50,007 22,125
-------- --------
Total noncurrent liabilities 451,078 74,511
Minority Interest 25,086 --
Shareholders' Equity:
Convertible Preferred Stock 25,000 --
Common Stock (one cent par value,
50,000,000 shares authorized;
20,513,287 shares outstanding
at September 30, 2001 and
20,339,203 at December 31, 2000) 205 203
Additional paid-in capital 168,414 166,184
Other Comprehensive Income 11,093 --
Retained earnings 32,694 36,252
-------- --------
Total shareholders' equity 237,406 202,639
-------- --------
Total $820,074 $333,770
======== ========
Century Aluminum Company
Consolidated Statements of Cash Flow
(Dollars in Thousands)
(Unaudited)
Nine Months Ended
September 30,
2001 2000
--------- ---------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 652 $ 16,873
Adjustments to reconcile net income to
net cash provided by (used in)
operating activities:
Depreciation and amortization 30,422 10,726
Deferred income taxes 183 5,439
Pension and other postretirement benefits 5,703 2,092
Inventory market adjustment 3,175 1,631
Gain on sale of fabricating businesses -- (5,156)
Minority Interest (2,613) --
Change in operating assets and liabilities:
Accounts receivable, trade net (5,106) 6,353
Due from affiliates 5,347 7,931
Inventories 4,079 5,541
Prepaids and other assets (15) (2,859)
Accounts payable, trade (8,776) (6,531)
Due to affiliates (2,138) (943)
Accrued and other current liabilities 14,877 (13,594)
Other net 1,071 12,673
--------- ---------
Net cash provided by (used in)
operating activities 46,861 40,176
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property, plant and equipment (9,257) (10,039)
Proceeds from sale of property,
plant and equipment 22 --
Divestitures 98,971 --
Acquisitions (464,176) (94,734)
Restricted cash deposits -- 5,642
--------- ---------
Net cash used in investing activities (374,440) (99,131)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings 321,352 --
Financing Fees (15,440) --
Dividends (4,210) (3,153)
Issuance of preferred stock 25,000 --
--------- ---------
Net cash provided by (used in)
financing activities 326,702 (3,153)
--------- ---------
NET INCREASE (DECREASE) IN CASH (877) (62,108)
CASH, BEGINNING OF PERIOD 32,962 85,187
--------- ---------
CASH, END OF PERIOD $ 32,085 $ 23,079
========= =========
Century Aluminum Company
Selected Operating Data
(in Thousands, Except Dollars per Pound)
(Unaudited)
SHIPMENTS - PRIMARY ALUMINUM
Direct
--------------------------------------
Pounds $/Pound
----------------- --------------
2001
3rd Quarter 259,408 $ 0.71
2nd Quarter 255,145 $ 0.74
1st Quarter 149,274 $ 0.74
2000
3rd Quarter 151,219 $ 0.73
2nd Quarter 149,530 $ 0.73
1st Quarter 128,082 $ 0.75
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