What changed in this filing

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Item 1. Financial Statements

2021-08-05 compared with 2021-05-07 · 298 added, 143 removed, 593 unchanged (43% of the section changed)

3 unchanged sentences

(in millions, except per share amounts)

Three months ended March 31,

Three months ended June 30,

Six months ended June 30,

Related parties $ 306.4 $ 285.6 $ 574.7 $ 556.6

10 unchanged sentences

Net gain (loss) on forward and derivative contracts ( 64.4 ) 3.7 ( 162.5 ) 7.5

Loss on early extinguishment of debt ( 24.7 ) — ( 24.7 ) —

Other income (expense) - net 1.2 1.3 3.1 3.0

1 unchanged sentence

Income tax benefit (expense) 48.3 ( 0.9 ) 50.6 1.9

Income (loss) before equity in earnings of joint ventures ( 35.1 ) ( 26.9 ) ( 175.1 ) ( 29.6 )

Equity in earnings of joint ventures 0.0 — 0.0 —

Net income (loss) $ ( 35.1 ) $ ( 26.9 ) $ ( 175.1 ) $ ( 29.6 )

8 unchanged sentences

(in millions)

Three months ended March 31,

Three months ended June 30,

Six months ended June 30,

Comprehensive income (loss):

13 unchanged sentences

(in millions)

March 31, 2021

June 30, 2021

December 31, 2020

23 unchanged sentences

Senior notes payable 245.4 243.1

Convertible senior notes payable 83.8 —

Iceland revolving credit facility — 45.0

2 unchanged sentences

Other liabilities 47.5 44.5

Derivative liabilities - less current portion 22.8 0.3

Leases - right of use liabilities 23.1 24.3

16 unchanged sentences

(in millions)

Three months ended March 31,

Six months ended June 30,

CASH FLOWS FROM OPERATING ACTIVITIES:

4 unchanged sentences

Depreciation and amortization 41.8 40.4

Loss on early extinguishment of debt 24.7 —

Change in deferred tax benefit ( 47.6 ) ( 0.5 )

Other non-cash items - net 4.2 2.4

14 unchanged sentences

CASH FLOWS FROM FINANCING ACTIVITIES:

Repayment of Senior Notes due 2025 ( 250.0 ) —

Early redemption and tender premiums paid ( 18.1 ) —

Proceeds from issuance of Senior Notes due 2028 250.0 —

Proceeds from issuance of Convertible Senior Notes 86.3 —

Repayments on Hawesville term loan ( 10.0 ) ( 10.0 )

1 unchanged sentence

Repayments under revolving credit facilities ( 432.3 ) ( 36.4 )

Debt issuance costs ( 7.4 ) —

Purchases of capped calls related to Convertible Senior Notes ( 5.7 ) —

Net cash provided by (used in) financing activities 39.7 76.0

5 unchanged sentences

Interest $ 25.7 $ 11.0

Taxes 0.0 0.1

CENTURY ALUMINUM COMPANY

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions)

Six months ended June 30,

Non-cash investing activities:

6 unchanged sentences

deficit Total shareholders’ equity

Three months ended March 31, 2021

Balance, December 31, 2020 $ 0.0 $ 1.0 $ 2,530.0 $ ( 86.3 ) $ ( 118.8 ) $ ( 1,779.8 ) $ 546.1

Three months ended June 30, 2021

Balance, March 31, 2021 $ 0.0 $ 1.0 $ 2,530.9 $ ( 86.3 ) $ ( 117.5 ) $ ( 1,919.8 ) $ 408.3

Net income (loss) — — — — — ( 35.1 ) ( 35.1 )

2 unchanged sentences

Conversion of preferred stock to common stock 0.0 0.0 0.0 — — — 0.0

Capped call premiums — — $ ( 4.6 ) — — — $ ( 4.6 )

Balance, June 30, 2021

$ 0.0 $ 1.0 $ 2,527.0 $ ( 86.3 ) $ ( 116.4 ) $ ( 1,954.9 ) $ 370.4

Three months ended June 30, 2020

Balance, March 31, 2020 $ 0.0 $ 1.0 $ 2,526.6 $ ( 86.3 ) $ ( 108.4 ) $ ( 1,659.1 ) $ 673.8

Net income (loss) — — — — — ( 26.9 ) ( 26.9 )

Other comprehensive income (loss) — — — — 0.7 — 0.7

Share-based compensation 0.0 0.0 1.1 — — — 1.1

Conversion of preferred stock to common stock 0.0 0.0 0.0 — — — 0.0

Balance, June 30, 2020

$ 0.0 $ 1.0 $ 2,527.6 $ ( 86.3 ) $ ( 107.6 ) $ ( 1,686.0 ) $ 648.7

Three months ended March 31, 2020

Preferred stock Common stock Additional paid-in capital Treasury stock, at cost Accumulated other comprehensive loss Accumulated

deficit Total shareholders’ equity

Six months ended June 30, 2021

Balance, December 31, 2020 $ 0.0 $ 1.0 $ 2,530.0 $ ( 86.3 ) $ ( 118.8 ) $ ( 1,779.8 ) $ 546.1

3 unchanged sentences

Conversion of preferred stock to common stock 0.0 0.0 0.0 — — — 0.0

Balance, March 31, 2020

$ 0.0 $ 1.0 $ 2,526.6 $ ( 86.3 ) $ ( 108.4 ) $ ( 1,659.1 ) $ 673.8

Capped call premiums — — ( 4.6 ) — — — ( 4.6 )

Balance, June 30, 2021 $ 0.0 $ 1.0 $ 2,527.0 $ ( 86.3 ) $ ( 116.4 ) $ ( 1,954.9 ) $ 370.4

Six months ended June 30, 2020

Balance, December 31, 2019 $ 0.0 $ 1.0 $ 2,526.5 $ ( 86.3 ) $ ( 109.8 ) $ ( 1,656.4 ) $ 675.0

Net income (loss) — — — — — ( 29.6 ) ( 29.6 )

Other comprehensive income (loss) — — — — 2.1 — 2.1

Share-based compensation — 0.0 1.1 — — — 1.1

Conversion of preferred stock to common stock 0.0 0.0 0.0 — — — 0.0

Balance, June 30, 2020 $ 0.0 $ 1.0 $ 2,527.6 $ ( 86.3 ) $ ( 107.6 ) $ ( 1,686.0 ) $ 648.7

CENTURY ALUMINUM COMPANY

Condensed Notes to the Consolidated Financial Statements

Three months ended March 31, 2021 and 2020

Six months ended June 30, 2021 and 2020

(amounts in millions, except share and per share amounts)

1 unchanged sentence

In management’s opinion, the unaudited interim consolidated financial statements reflect all adjustments, which are of a normal and recurring nature, that are necessary for a fair presentation of financial results for the interim periods presented.

Operating results for the first three months of 2021 are not necessarily indicative of the results that may be expected for the year ending December 31, 2021.

Operating results for the first six months of 2021 are not necessarily indicative of the results that may be expected for the year ending December 31, 2021.

Throughout this Form 10-Q, and unless expressly stated otherwise or as the context otherwise requires, "Century Aluminum," "Century," the "Company," "we," "us," "our" and "ours" refer to Century Aluminum Company and its consolidated subsidiaries.

9 unchanged sentences

We presented the alternative financial disclosures in Item 2.

Management's Discussion a n d A nalysis - Liquidity and Capital Resources .

Management's Discussion and Analysis - Liquidity and Capital Resources.

The adoption of the SEC rule is limited to disclosures only and did not have a material effect on the Company’s consolidated financial statements.

Related Party Transactions

The significant related party transactions occurring during the three months ended March 31, 2021 and 2020 are described below.

The significant related party transactions occurring during the six months ended June 30, 2021 and 2020 are described below.

We believe all of our transactions with related parties are at prices that approximate market.

Glencore ownership

As of March 31, 2021, Glencore plc and its affiliates (together "Glencore") beneficially owned 42.9 % of Century’s outstanding common stock ( 46.7 % on a fully-diluted basis assuming the conversion of all of the Series A Convertible Preferred Stock) and all of our outstanding Series A Convertible Preferred Stock.

As of June 30, 2021, Glencore plc and its affiliates (together "Glencore") beneficially owned 42.9 % of Century’s outstanding common stock ( 46.7 % o n a fully-diluted basis assuming the conversion of all of the Series A Convertible Preferred Stock) and all of our outstanding Series A Convertible Preferred Stock.

Shareholders' Equity for a description of our outstanding Series A Convertible Preferred Stock.

4 unchanged sentences

Sales to Glencore

For the three months ended March 31, 2021 and 2020, we derived approximately 60 % and 64 %, respectively, of our consolidated net sales from Glencore.

Glencore purchases aluminum produced at our U.S smelters at prices primarily based on the London Metal Exchange (the "LME") plus the Midwest regional delivery premium plus any additional market-based product premiums.

For the three months ended June 30, 2021 and 2020, approximately 58.0 % and 71.0 %, respectively, of our consolidated net sales were made to Glencore, while for the six months ended June 30, 2021 and 2020, we derived appro ximately 59.1 % an d 67.6 %, respectively, of our consolidated net sales from Glencore.

Glencore purchases aluminum produced at our U.S.

smelters at prices primarily based on the London Metal Exchange (the "LME") plus the Midwest regional delivery premium plus any additional market-based product premiums.

Glencore purchases aluminum produced at our Grundartangi, Iceland smelter at prices primarily based on the LME plus the European Duty Paid premium plus any additional market-based product premiums.

We have also entered into agreements with Glencore pursuant to which we sell certain amounts of alumina at market-based prices.

For the three months ended March 31, 2021, we recorded no revenue related to alumina sales to Glencore, and for the three months ended March 31, 2020, we recor ded $ 0.3 million of revenue related to alumina sales to Glencore, respectively.

For the three months and six months ended June 30, 2021, we recorded $ 11.4 million and $ 11.4 million of revenue related to alumina sales to Glencore, respectively.

For the three and six months ended June 30, 2020, we recor ded $ 0.9 million and $ 1.2 million of revenue related to alumina sales to Glencore, respectively.

Purchases from Glencore

We purchase a portion of our alumina and certain other raw material requirements from Glencore.

Alumina purchases from Glencore during the three months ended March 31, 2021 were priced based on published alumina and aluminum indices.

Alumina purchases from Glencore during the six months ended June 30, 2021 were priced based on published alumina and aluminum indices.

Financial contracts with Glencore

6 unchanged sentences

A summary of the aforementioned significant related party transactions is as follows:

Three months ended March 31,

Three months ended June 30,

Six months ended June 30,

Net sales to Glencore $ 306.4 $ 285.6 $ 574.7 $ 556.6

1 unchanged sentence

We disaggregate our revenue by geographical region as follows:

Net Sales Three months ended March 31,

Net Sales Three months ended June 30,

Six months ended June 30,

United States $ 347.9 $ 247.9 $ 624.1 $ 522.0

15 unchanged sentences

• Level 3 Inputs - significant unobservable inputs for the asset or liability.

Recurring Fair Value Measurements As of March 31, 2021

Recurring Fair Value Measurements As of June 30, 2021

Cash equivalents $ 0.1 $ — $ — $ 0.1

22 unchanged sentences

LME forward financial sales contracts Discounted cash flows Quoted LME forward market

MWP forward financial sales contracts Discounted cash flows Quoted MWP forward market

Midwest Premium ("MWP") forward financial sales contracts Discounted cash flows Quoted MWP forward market

Fixed for floating swaps Discounted cash flows Quoted LME forward market, quoted MWP forward market

Nord Pool power price swaps Discounted cash flows Quoted Nord Pool forward market

Indiana Hub power price swaps Discounted cash flows Quoted Indiana Hub forward market

FX swaps Discounted cash flows Euro/USD forward exchange rate

Contingent obligation Discounted cash flows Quoted LME forward market

When valuing Level 3 assets and liabilities, we use certain significant unobservable inputs.

1 unchanged sentence

Our estimates of significant unobservable inputs are ultimately based on our estimates of risks that market participants would consider when valuing our assets and liabilities.

CENTURY ALUMINUM COMPANY

Condensed Notes to the Consolidated Financial Statements (continued)

(amounts in millions, except share and per share amounts)

The following table presents the inputs for fair value measurements categorized within Level 3 of the fair value hierarchy, along with information regarding significant unobservable inputs used to value Level 3 assets and liabilities:

Level 3 Fair Value Measurements:

Asset / Liability Fair Value at March 31, 2021 Valuation Technique Observable Inputs Significant Unobservable Input Value/Range of Unobservable Input

As of June 30, 2021 As of December 31, 2020

Asset / Liability Valuation Technique Observable Inputs Significant Unobservable Input Fair Value Value/Range of Unobservable Input Fair Value Value/Range of Unobservable Input

LME forward financial sales contracts Discounted cash flows Quoted LME forward market Discount rate net (1)

Contingent obligation $ — Discounted cash flows Quoted LME forward market, management's estimate of the LME forward market prices for periods beyond the quoted periods, management's estimates of future level of operations Management's estimates of the LME forward market price beyond the quoted periods (2)

$ 2,217 /T-$ 2,321 /T

$ ( 17.9 ) 8.58 % $ 2.9 10.00 %

FX swaps Discounted cash flows Euro/USD forward exchange rate Discount rate net (1)

$ ( 0.4 ) 8.58 % $ 0.1 10.00 %

Nord Pool power price swaps Discounted cash flows Quoted Nord Pool forward market Discount rate net (1)

$ 1.5 8.58 % — —

(1) Represents risk adjusted discount rate.

(2) Represents the range of estimated forward LME prices of primary aluminum through the term of the agreement in December 2028.

CENTURY ALUMINUM COMPANY

2 unchanged sentences

The following table presents the fair value reconciliation of Level 3 assets and liabilities measured at fair value on a recurring basis.

Level 3 Liabilities

For the three months ended March 31, 2021

LME forward financial sales contracts FX Swaps

Level 3 Assets Level 3 Liabilities

For the three months ended June 30, 2021

Nord Pool LME forward financial sales contracts FX Swaps

Balance as of April 1, 2021 $ — $ ( 6.0 ) $ ( 0.2 )

Total realized/unrealized gains (losses)

Included in net income (loss) (1)

— ( 11.6 ) 0.0

Purchases, sales, settlements

Purchases — — —

Settlements — — —

Transfers into Level 3 (2)

1.5 ( 0.3 ) ( 0.2 )

Transfers out of Level 3 (3)

Balance as of June 30, 2021

1.5 ( 17.9 ) $ ( 0.4 )

Change in unrealized gains (losses) (1)

0.0 $ ( 11.6 ) 0.0

(1) Gains and losses are presented in the Consolidated Statement of Operations within the line item "Net gain (loss) on forward and derivative contracts."

(2) Transfers into Level 3 due to contracts with applied discount rate during the second quarter of 2021.

(3) Transfers out of Level 3 due to period of time remaining in derivative contract.

For the three months ended June 30, 2020

Level 3 Assets Level 3 Liabilities

LME forward financial sales contracts Hawesville L4 Power Price Swaps

Balance as of April 1, 2020 $ 7.8 $ ( 3.2 )

Total realized/unrealized gains (losses)

Included in net income (1)

Purchases, sales, settlements

Purchases — —

Settlements — 1.7

Transfers into Level 3 (2)

Transfers out of Level 3 (3)

Balance as of June 30, 2020

$ 6.1 $ ( 1.5 )

Change in unrealized gains (losses) $ ( 1.7 ) $ 1.7

(1) Gains and losses are presented in the Consolidated Statement of Operations within the line item "Net gain (loss) on forward and derivative contracts."

(2) Transfers into Level 3 due to contracts with applied discount rate during the second quarter of 2020.

(3) Transfers out of Level 3 due to period of time remaining in derivative contract.

CENTURY ALUMINUM COMPANY

Condensed Notes to the Consolidated Financial Statements (continued)

(amounts in millions, except share and per share amounts)

Level 3 Assets Level 3 Liabilities

For the six months ended June 30, 2021

Nord Pool LME forward financial sales contracts FX Swaps

Balance as of January 1, 2021

$ — $ 2.9 $ 0.1

Total realized/unrealized gains (losses)

Included in net income (loss) (1)

— ( 20.3 ) 0.0

Purchases, sales, settlements

4 unchanged sentences

Transfers out of Level 3 (3)

Balance as of March 31, 2021

— 0.5 ( 0.1 )

Balance as of June 30, 2021

1.5 ( 17.9 ) $ ( 0.4 )

Change in unrealized gains (losses) (1)

1 unchanged sentence

(1) Gains and losses are presented in the Consolidated Statement of Operations within the line item "Net gain (loss) on forward and derivative contracts."

(2) Transfers into Level 3 due to contracts with applied discount rate during the first quarter of 2021.

(2) Transfers into Level 3 due to contracts with applied discount rate during the six months ended June 30, 2021.

(3) Transfers out of Level 3 due to period of time remaining in derivative contract.

For the three months ended March 31, 2020

For the six months ended June 30, 2020

Level 3 Assets Level 3 Liabilities

8 unchanged sentences

Transfers out of Level 3 (3)

Balance as of March 31, 2020

Balance as of June 30, 2020

$ 6.1 $ ( 1.5 )

Change in unrealized gains (losses) (1)

$ 6.7 $ ( 0.3 )

(1) Gains and losses are presented in the Consolidated Statement of Operations within the line item "Net gain (loss) on forward and derivative contracts."

(2) Transfers into Level 3 due to contracts with applied discount rate during the first quarter of 2020.

(2) Transfers into Level 3 due to contracts with applied discount rate during the six months ended June 30, 2020.

(3) Transfers out of Level 3 due to period of time remaining in derivative contract.

6 unchanged sentences

The following table shows the basic and diluted earnings (loss) per share:

For the three months ended March 31

For the three months ended June 30

Net Income (Loss) Shares (in millions)

6 unchanged sentences

$ ( 35.1 ) 90.1 $ ( 0.39 ) $ ( 26.9 ) 89.5 $ ( 0.30 )

Three months ended March 31,

For the six months ended June 30

Net Income (Loss) Shares (in millions)

Per Share Net Income (Loss) Shares

(in millions)

Net income (loss)

$ ( 175.1 ) $ ( 29.6 )

Amount allocated to common stockholders

100.0 % 100.0 %

Basic and diluted EPS (1)

$ ( 175.1 ) 90.1 $ ( 1.94 ) $ ( 29.6 ) 89.4 $ ( 0.33 )

Three months ended June 30,

Six months ended June 30,

Securities excluded from the calculation of diluted EPS (in millions) (1) :

1 unchanged sentence

Convertible preferred shares 6.3 6.6 6.3 6.7

(1) In periods when we report a net loss, all share-based compensation awards and convertible preferred shares are excluded from the calculation of diluted weighted average shares outstanding because of their anti-dilutive effect on earnings (loss) per share.

(2) Convertible preferred shares are considered in diluted EPS using the if-converted method in accordance with our adoption of ASU 2020-06 effective January 1, 2021 using a modified retrospective approach.

Convertible senior notes 4.8 — 4.8 —

(1) In periods when we report a net loss, all share-based compensation awards, convertible preferred shares and convertible senior notes are excluded from the calculation of diluted weighted average shares outstanding because of their anti-dilutive effect on earnings (loss) per share.

CENTURY ALUMINUM COMPANY

2 unchanged sentences

Shareholders’ Equity

As of March 31, 2021 and December 31, 2020, we had 195,000,000 shares of common stock, $ 0.01 par value per share, authorized under our Restated Certificate of Incorporation, of which 97,274,235 shares were issued and 90,087,714 shares were outstanding at March 31, 2021;

As of June 30, 2021 and December 31, 2020, we had 195,000,000 shares of common stock, $ 0.01 par value per share, authorized under our Restated Certificate of Incorporation, of which 97,315,639 shares were issued and 90,129,118 shares were outstanding at June 30, 2021;

97,242,318 shares were issued and 90,055,797 shares were outstanding at December 31, 2020.

1 unchanged sentence

Preferred Stock

As of March 31, 2021 and December 31, 2020, we had 5,000,000 shares of preferred stock, $ 0.01 par value per share, authorized under our Restated Certificate of Incorporation.

As of June 30, 2021 and December 31, 2020, we had 5,000,000 shares of preferred stock, $ 0.01 par value per share, authorized under our Restated Certificate of Incorporation.

Our Board of Directors may issue preferred stock in one or more series and determine for each series the dividend rights, conversion rights, voting rights, redemption rights, liquidating preferences, sinking fund terms and the number of shares constituting that series, as well as the designation thereof.

5 unchanged sentences

Glencore holds all of the issued and outstanding Series A Convertible Preferred Stock.

At March 31, 2021 and December 31, 2020, there were 63,452 and 63,589 shares of Series A Convertible Preferred Stock outstanding, respectively.

At June 30, 2021 and December 31, 2020, there were 63,274 and 63,589 shares of Series A Convertible Preferred Stock outstanding, respectively.

The issuance of common stock under our stock incentive programs, debt exchange transactions and any stock offering that excludes Glencore participation triggers anti-dilution provisions of the preferred stock agreement and results in the automatic conversion of Series A Convertible Preferred Stock shares into shares of common stock.

The conversion ratio of preferred to common shares is 100 shares of common stock for each share of preferred stock.

The Common and Preferred Stock table below contains additional information about preferred stock conversions during the three months ended March 31, 2021 and 2020.

The Common and Preferred Stock table below contains additional information about preferred stock conversions during the six months ended June 30, 2021 and 2020.

Preferred stock Common stock

5 unchanged sentences

Issuance for share-based compensation plans — — 41,856

Ending balance as of March 31, 2021

Ending balance as of June 30, 2021

63,274 7,186,521 90,129,118

3 unchanged sentences

Issuance for share-based compensation plans — — 170,784

Ending balance as of March 31, 2020

Ending balance as of June 30, 2020

66,039 7,186,521 89,484,834

13 unchanged sentences

We have repurchased 7,186,521 shares of common stock under the program for an aggregate purchase price of $ 86.3 million.

We have made no repurchases since April 2015 and we have $ 43.7 million remaining under the repurchase program authorization as of March 31, 2021.

We recorded an income tax benefit of $ 2.3 million and $ 2.8 million for the three months ended March 31, 2021 and 2020, respectively.

The change is primarily due to improved operational results from foreign operations in the current quarter.

We have made no repurchases since April 2015 and we have $ 43.7 million remaining under the repurchase program authorization as of June 30, 2021.

We recorded an income tax benefit of $ 48.3 million and an income tax expense of $ 0.9 million for the three months ended June 30, 2021 and 2020, respectively and for the six months ended June 30, 2021 and 2020, we recorded an income tax benefit of $ 50.6 million and $ 1.9 million, respectively.

We recorded a discrete tax benefit of $ 49.8 million in the current quarter tax provision related to the recognition of a certain foreign deferred tax asset.

The deferred tax asset represents the future tax benefit we expect to realize for deductible costs related to our historical investment in Nordural Helguvik ehf (“Helguvik”).

During the period, it became apparent this deferred tax asset would reverse in the foreseeable future.

As this deferred tax asset is expected to be realized prior to expiration, we have not recorded a valuation allowance.

We did not change our judgment in the current quarter with respect to other valuation allowances previously recorded.

Our income tax benefit or expense is based on an annual effective tax rate forecast, including estimates and assumptions that could change during the year.

The application of the accounting requirements for income taxes in interim periods, after consideration of our valuation allowance, causes a significant variation in the typical relationship between income tax expense/benefit and pre-tax accounting income/loss.

As of March 31, 2021, all of Century's U.S.

As of June 30, 2021, all of Century's U.S.

and certain foreign deferred tax assets, net of deferred tax liabilities, continue to be subject to a valuation allowance.

Inventories consist of the following:

March 31, 2021

June 30, 2021

December 31, 2020

8 unchanged sentences

(amounts in millions, except share and per share amounts)

March 31, 2021

June 30, 2021

December 31, 2020

6 unchanged sentences

Iceland Revolving Credit Facility (4)

12.0 % senior secured notes due July 1, 2025, net of debt discount of $ 2.2 million and $ 2.3 million, and financing fees of $ 4.4 million and $ 4.6 million at March 31, 2021 and December 31, 2020, respectively, interest payable semiannually

12.0 % senior secured notes due July 1, 2025, net of debt discount of $ 2.3 million, and financing fees of $ 4.6 million at December 31, 2020, interest payable semiannually

7.5 % senior secured notes due April 1, 2028, net of financing fees of $ 4.6 million at June 30, 2021, interest payable semiannually

2.75 % convertible senior notes due May 1, 2028, net of financing fees of $ 2.5 million at June 30, 2021, interest payable semiannually

Total $ 386.6 $ 315.9

(1) See "Hawesville Term Loan" below.

At March 31, 2021, the applicable interest rate was LIBOR of 0.2 % plus margin of 5.375 % and there is no interest payable outstanding.

As of March 31, 2021, we have made $ 25.0 million of principal payments and $ 2.2 million of interest payments.

At June 30, 2021, the applicable interest rate was LIBOR of 0.2 % plus margin of 5.375 % and there is no interest payable outstanding.

As of June 30, 2021, we have made $ 30.0 million of principal payments and $ 4.4 million of interest payments.

(2) The IRBs are classified as current liabilities because they are remarketed weekly and could be required to be repaid upon demand if there is a failed remarketing.

The IRBs interest rate at March 31, 2021 was 0.2 %.

The IRBs interest rate at June 30, 2021 was 0.2 %.

(3) We have elected to incur interest at a base rate plus applicable margin as defined within the agreement.

The interest rate at March 31, 2021 was 3.8 %.

The interest rate at June 30, 2021 was 3.75 %.

(4) We have elected to incur interest at LIBOR plus applicable margin as defined within the agreement.

12.0 % Notes due 2025

On July 1, 2020, we issued $ 250.0 million in aggregate principal amount of 12.0 % senior secured notes due 2025 (the "2025 Notes").

The 2025 Notes were issued at a discount and we received proceeds of $ 243.8 million, prior to payment of certain financing fees and related expenses.

Fair value for our 2025 Notes, based on the latest trading data available, was $ 268.8 million as of March 31, 2021.

Although we use quoted market prices for identical debt instruments, the markets on which they trade are not considered to be active and are therefore considered Level 2 fair value measurements.

In connection with the offering of the 2028 Notes described below, we commenced a cash tender offer to purchase any and all of our outstanding 2025 Notes at par plus a tender premium of $ 14.6 million.

On April 14, 2021, we purchased $ 195.9 million aggregate principal amount of the 2025 Notes in the tender offer, and notified the holders of all outstanding 2025 Notes that were not purchased in the tender offer of our election to redeem all such remaining 2025 Notes on May 14, 2021.

7.5 % Senior Secured Notes due 2028

As disclosed in N ote 14.

Subsequent E vents , on April 14, 2021, we issued $ 250.0 million in aggregate principal amount of senior secured notes due 2028 (the "2028 Notes").

On April 14, 2021, we issued $ 250.0 million in aggregate principal amount of 7.5 % senior secured notes due 2028 (the "2028 Notes").

We received proceeds of $ 245.2 million, after payment of certain financing fees and related expenses.

Interest Rate.

The 2028 Notes bear interest semi-annually in arrears on April 1 and October 1 of each year, beginning on October 1, 2021, at a rate of 7.5 % per annum in cash.

The 2028 Notes mature on April 1, 2028.

The 2028 Notes are senior secured obligations of Century, ranking equally in right of payment with all existing and future senior indebtedness of Century, but effectively senior to unsecured debt to the extent of the value of collateral.

Our obligations under the 2028 Notes are guaranteed by all of our existing and future domestic restricted subsidiaries (the “Guarantor Subsidiaries”), except for foreign owned holding companies, any domestic restricted subsidiary that owns no assets other than equity interests or other investments in foreign subsidiaries and certain immaterial subsidiaries, which guaranty shall in each case be a senior secured obligation of such Guarantor Subsidiaries, ranking equally in right of payment with all existing and future senior indebtedness of such Guarantor Subsidiaries but effectively senior to unsecured debt to the extent of the value of collateral.

Our obligations under the 2028 Notes and the Guarantor Subsidiaries' obligations under the guarantees are secured by a pledge of and lien on (subject to certain exceptions):

(i) all of our and the Guarantor Subsidiaries' property, plant and equipment (other than certain excluded property);

(ii) all equity interests in subsidiaries directly owned by Century or any Guarantor Subsidiaries;

CENTURY ALUMINUM COMPANY

Condensed Notes to the Consolidated Financial Statements (continued)

(amounts in millions, except share and per share amounts)

(iii) proceeds of the foregoing.

Under certain circumstances, the indenture and the security documents governing the 2028 Notes will permit us and the guarantors to incur additional debt that also may be secured by liens on the collateral that are equal to or have priority over the liens securing the 2028 Notes.

The collateral agent for the 2028 Notes will agree with the collateral agent for the other debt holders and us under such circumstances to enter into an intercreditor agreement that will cause the liens securing the 2028 Notes to be contractually subordinated to the liens securing such additional debt.

Redemption Rights.

Prior to April 1, 2024, we may redeem the 2028 Notes, in whole or in part, at a redemption price equal to 100.00 % of the principal amount plus a make-whole premium and accrued and unpaid interest, and if redeemed during the twelve -month period beginning on April 1 of the years indicated below, at the following redemption prices plus accrued and unpaid interest:

Year Percentage

2024 103.750 %

2025 101.875 %

2026 & Thereafter 100.000 %

Upon a change of control (as defined in the indenture governing the 2028 Notes), we will be required to make an offer to purchase the 2028 Notes at a purchase price equal to 101 % of the outstanding principal amount of the 2028 Notes on the date of the purchase, plus accrued and unpaid interest to, but not including, the date of purchase.

The indenture governing the 2028 Notes contains customary covenants which may limit our ability, and the ability of certain of our subsidiaries, to:

(i) incur additional debt;

(ii) incur additional liens;

(iii) pay dividends or make distributions in respect of capital stock;

(iv) purchase or redeem capital stock;

(v) make investments or certain other restricted payments;

(vi) sell assets;

(vii) issue or sell stock of certain subsidiaries;

(viii) enter into transactions with shareholders or affiliates;

and (ix) effect a consolidation or merger.

As of June 30, 2021, the total estimated fair value of the 2028 Notes was $ 265.4 million.

Although we use quoted market prices for identical debt instruments, the markets on which they trade are not considered to be active and are therefore considered Level 2 fair value measurements.

12.0 % Notes Tender Offer and Redemption

In April 2021, we commenced a tender offer to the holders of the outstanding 12.0 % senior secured notes due July 2025 (the "2025 Notes") and notified all such holders of our election to redeem all 2025 Notes not purchased in our tender offer on May 14, 2021.

We received tenders for approximately $ 195.9 million in aggregate principal amount of the 2025 Notes and the remaining 2025 Notes were redeemed on May 14, 2021 at a redemption price of 107 % of the principal amount thereof, plus accrued and unpaid interest.

As a result, the Company's and the guarantors' obligations under the indenture governing the 2025 Notes have been fully discharged.

We applied net proceeds from the offering of the 2028 Notes described above, together with a portion of the net proceeds from the Convertible Notes offering described below, toward payment of the total consideration amount to holders whose 2025 Notes were accepted and purchased in the tender offer and to fund the redemption of any remaining 2025 Notes.

Based on the characteristics of the 2025 Notes and the 2028 Notes that were issued, the tender and redemption of the 2025 Notes were accounted for as an extinguishment of the debt.

Accordingly, we have recorded a $ 24.7 million loss on early extinguishment of debt, consisting of early redemption and tender premiums of $ 18.1 million, write-off of deferred financing costs and the debt discount associated with the 2025 Notes of $ 4.4 million and $ 2.2 million, respectively.

Convertible Notes due 2028

In addition, as disclosed in Note 14.

Subsequent E vents , on April 9, 2021, we completed a private offering of $ 86.3 million aggregate principal amount of convertible senior notes due 2028 (the "Convertible Notes").

The Convertible Notes were issued at a price of 100 % of their aggregate principal amount, will pay interest semi-annually in arrears on May 1 and November 1 of each year, beginning on November 1, 2021, at a rate of 2.75 % per annum in cash, and will mature on May 1, 2028, unless earlier converted, repurchased, or redeemed.

On April 9, 2021, we completed a private offering of $ 86.3 million aggregate principal amount of convertible senior notes due 2028 (the "Convertible Notes").

The Convertible Notes were issued at a price of 100 % of their aggregate principal amount.

We received proce eds of $ 83.7 million, a fter payment of certain financing fees and related expenses.

CENTURY ALUMINUM COMPANY

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(amounts in millions, except share and per share amounts)

The initial conversion rate for the Convertible Notes is 53.3547 shares of the Company's common stock per $1,000 principal amount of Convertible Notes, which is equivalent to an initial conversion price of approximately $ 18.74 per share of the Company's common stock.

The conversion rate and conversion price are subject to customary adjustments under certain circumstances in accordance with the terms of the indenture.

Interest Rate.

The Convertible Notes will bear interest semi-annually in arrears on May 1 and November 1 of each year, beginning on November 1, 2021, at a rate of 2.75 % per annum in cash.

The Convertible Notes will mature on May 1, 2028, unless earlier converted, repurchased, or redeemed.

The Convertible Notes are the Company’s senior unsecured obligations and rank senior in right of payment to any of the Company’s indebtedness that is expressly subordinated in right of payment to the Convertible Notes;

equal in right of payment to any of the Company’s unsecured indebtedness that is not so subordinated;

effectively junior in right of payment to any of the Company’s senior secured indebtedness to the extent of the value of the assets securing such indebtedness;

and structurally junior to all indebtedness and other liabilities (including trade payables) of the Company’s subsidiaries.

Redemption rights.

We may not redeem the Notes prior to May 6, 2025.

On or after May 6, 2025, we may redeem for cash all or part of the Notes at our option if the last reported sale price of our common stock has been at least 130 % of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading-day period (including the last trading day of such period) ending on and including the trading day immediately preceding the date on which we provide notice of redemption, at a redemption price equal to 100 % of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest.

Upon conversion, we may satisfy our conversion obligation by paying or delivering, as applicable, cash, shares of our common stock or a combination of cash and shares of our common stock, at our election, based on the applicable conversion rate.

In addition, if certain corporate events that constitute a make-whole fundamental change (as defined in the indenture) occur, then the conversion rate will, in certain circumstances, be increased for a specified period of time.

Additionally in the event of a corporate event constituting a fundamental change (as defined in the indenture), holders of the Convertible Notes may require us to repurchase all or a portion of their Convertible Notes at a repurchase price equal to 100 % of the principal amount of the Notes being repurchased, plus accrued and unpaid interest to, but excluding, the date of the fundamental change repurchase.

As of June 30, 2021, the if-converted value of the Convertible Notes did not exceed the outstanding principal amount.

As of June 30, 2021, the total estimated fair value of the Convertible Notes was $ 83.5 million.

Although we use quoted market prices for identical debt instruments, the markets on which they trade are not considered to be active and are therefore considered Level 2 fair value measurements.

On April 6, 2021 and April 7, 2021, in connection with the pricing of the Convertible Notes, we entered into privately negotiated capped call transactions (the “Capped Calls”) with certain of the initial purchasers and other financial institutions (the "Option Counterparties") at a cost of $ 5.7 million.

The Capped Calls cover, subject to customary adjustments, the number of shares of our common stock initially underlying the Convertible Notes.

By entering into the Capped Calls, we expect to reduce the potential dilution to our common stock upon any conversion of Notes (or, in the event a conversion of the Convertible Notes is settled in cash, to reduce our cash payment obligation) in the event that at the time of conversion of the Convertible Notes our common stock price exceeds the conversion price of the Convertible Notes.

The Capped Calls each have an initial strike price of approximately $ 18.74 per share, subject to certain adjustments, which corresponds to the initial conversion price of the Convertible Notes.

The Capped Calls have an initial cap price of $ 22.95 per share of common stock .

On April 6, 2021 and April 7, 2021, we entered into side letters with the Option Counterparties that modified the terms of the Capped Calls, thus requiring derivative accounting treatment with changes in fair value reported in earnings.

On June 29, 2021, we terminated the side letters with the Option Counterparties by mutual agreement.

As of June 30, 2021, the Capped Calls meet the criteria for classification in equity and are included as a reduction to additional paid-in-capital within stockholders’ equity.

During the period the Capped Calls were classified as derivatives, we recognized $ 1.0 million as a loss on forward and derivative contracts.

CENTURY ALUMINUM COMPANY

Condensed Notes to the Consolidated Financial Statements (continued)

(amounts in millions, except share and per share amounts)

Hawesville Term Loan

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revolving credit facility reduce our borrowing availability on a dollar-for-dollar basis.

At March 31, 2021, there were $ 50.4 million in outstanding borrowings under our U.S.

At June 30, 2021, there were $ 39.6 million in outstanding borrowings under our U.S.

revolving credit facility.

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revolving credit facility:

March 31, 2021

June 30, 2021

Credit facility maximum amount $ 175.0

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Our wholly-owned subsidiary, Nordural Grundartangi ehf ("Grundartangi"), has entered into a $ 50.0 million revolving credit facility agreement with Landsbankinn hf., dated November 2013, as amended (the "Iceland revolving credit facility").

At March 31, 2021, there were no outstanding borrowings under our Iceland revolving credit facility.

At June 30, 2021, there were no outstanding borrowings under our Iceland revolving credit facility.

The Iceland revolving credit facility has a term through November 2022.

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Status of our Iceland revolving credit facility:

March 31, 2021

June 30, 2021

Credit facility maximum amount $ 50.0

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CAWV has agreed to pay the remaining amounts under the settlement agreement in annual increments of $ 2.0 million for nine years .

As of March 31, 2021, $ 2.0 million was recorded in other current liabilities and $ 7.7 million was recorded in other liabilities.

As of June 30, 2021, $ 2.0 million was recorded in other current liabilities and $ 7.8 million was recorded in other liabilities.

CENTURY ALUMINUM COMPANY

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Under certain circumstances, in periods of lower primary aluminum prices relative to our cost of operations, we are able to defer one or more of these payments, provided that we provide the PBGC with acceptable security for such deferred payments.

We did no t make any contributions for the three month periods ended March 31, 2021, and 2020.

We did no t make any contributions for the three month periods ended June 30, 2021, and 2020.

We have elected to defer certain payments under the PBGC agreement and have provided the PBGC with the appropriate security.

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In October 2020, parties participating in the Hydrocarbon Recovery Plan filed a complaint against Century and Virgin Islands Alumina Corporation, L.L.C.

relating to the Hydrocarbon Recover Plan.

The deadline to respond to the complaint has been postponed by all parties until May 27, 2021.

At this time, we are not able to estimate the amount of any future potential payments under this indemnification to comply with the Order, but we do not anticipate that any such amounts will have a material adverse effect on our financial condition, results of operations or liquidity, regardless of the final outcome.

relating to the Hydrocarbon Recovery Plan.

This matter was settled by all parties and dismissed by the court in June 2021.

We recognized $( 0.6 ) million within Other income (expense) during the three months ended June 30, 2021 related to the settlement.

In December 2010, Century was among several defendants named in a lawsuit filed by plaintiffs who either worked, resided or owned property in the area downwind from the St.

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On February 28, 2018, plaintiffs in both cases filed a Motion for Voluntary Dismissal of Century without prejudice to refiling.

At this time, it is not possible to predict the ultimate outcome of or to estimate a range of reasonably possible losses for any of the foregoing actions relating to the St.

Croix Alumina Refinery.

The refiling of claims by the plaintiffs is now time barred, and this matter is closed.

Power Commitments and Contingencies

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These power purchase agreements expire on various dates from 2026 through 2036 (subject to extension).

The power purchase agreements with HS and OR both provide power at LME-based variable rates for the duration of these agreements.

The power purchase agreement with Landsvirkjun for 161 MW provides power at rates linked to the Nord Pool power market.

Nordural Helguvik ehf ("Helguvik") has a power purchase agreement with OR to provide a portion of the power requirements to the Helguvik project.

The agreement would provide power at LME-based variable rates and contain take-or-pay obligations with respect to a significant percentage of the total committed and available power under such agreement.

The first phase of power under the OR purchase agreement (approximately 47.5 MW) became available in the fourth quarter of 2011 and is currently being utilized at Grundartangi.

The agreement also contains certain conditions to OR’s obligations with respect to the remaining phases and OR has alleged that certain of these conditions have not been satisfied.

The power purchase agreements with HS and OR provide power at LME-based variable rates for the duration of these agreements.

Grundartangi recently reached an agreement with Landsvirkjun for an extension of its existing 161 MW power contract that would have expired in December 2023.

Under the terms of the extension, Landsvirkjun will continue to supply power to Grundartangi from January 1, 2024 through December 31, 2026 and will increase the existing contract from 161 MW to 182 MW over time to provide the necessary flexibility to support the most recent capacity creep requirements and future growth opportunities for value-added products at the Grundartangi plant.

Under the terms of this extension, the majority of power supplied by Landsvirkjun will be priced at rates linked to the Nord Pool power market through December 2023 and a small portion of power at a fixed price.

Thereafter, beginning January 1, 2024 through December 31, 2026 this agreement provides for only fixed rates.

Grundartangi also has a 25 MW power purchase agreement with Landsvirkjun at LME-based variable rates.

Other Commitments and Contingencies

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This agreement is effective through December 31, 2024.

100 % of Vlissingen's work force is represented by the FME since Vlissingen is a member of the Federation for the Metal and Electrical Industry ("FME"), a Netherlands' employers' organization for companies in the metal, electronics, electrical engineering and plastic sectors.

100 % of Vlissingen's work force is represented by the Federation for the Metal and Electrical Industry ("FME"), a Netherlands' employers' organization for companies in the metal, electronics, electrical engineering and plastic sectors.

The FME negotiates working conditions with trade unions on behalf of its members, which, when agreed upon, are then applicable to all employees of Vlissingen.

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based work force is represented by USW.

On April 16, 2021, a new labor agreement for Hawesville employees was reached, running through April 1, 2026.

Refer to Note 14.

Subse quent Events for further detail.

The labor agreement for Hawesville employees is effective through April 1, 2026.

Century Sebree's labor agreement with the USW for its employees is effective through October 28, 2023.

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Components of AOCL:

March 31, 2021

June 30, 2021

December 31, 2020

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(1) The allocation of the income tax effect to the components of other comprehensive loss is as follows:

March 31, 2021

June 30, 2021

December 31, 2020

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Unrealized loss on financial instruments ( 0.4 ) ( 0.4 )

CENTURY ALUMINUM COMPANY

Condensed Notes to the Consolidated Financial Statements (continued)

(amounts in millions, except share and per share amounts)

The following table summarizes the changes in the accumulated balances for each component of AOCL:

Defined benefit plan and other postretirement liabilities Unrealized gain (loss) on financial instruments Total, net of tax

Balance, January 1, 2021

$ ( 120.6 ) $ 1.8 $ ( 118.8 )

Balance, April 1, 2021 $ ( 119.3 ) $ 1.8 $ ( 117.5 )

Net amount reclassified to net income (loss) 1.2 ( 0.1 ) 1.1

Balance, March 31, 2021

$ ( 119.3 ) $ 1.8 $ ( 117.5 )

Balance, January 1, 2020

Balance, June 30, 2021

$ ( 118.1 ) $ 1.7 $ ( 116.4 )

Balance, April 1, 2020 $ ( 110.3 ) $ 1.9 $ ( 108.4 )

Net amount reclassified to net income 0.8 $ — 0.8

Balance, March 31, 2020

Balance, June 30, 2020

$ ( 109.5 ) $ 1.9 $ ( 107.6 )

Balance, December 31, 2020 $ ( 120.6 ) $ 1.8 $ ( 118.8 )

Net amount reclassified to net loss 2.5 ( 0.1 ) 2.4

Balance, June 30, 2021

$ ( 118.1 ) $ 1.7 $ ( 116.4 )

Balance, December 31, 2019

$ ( 111.7 ) $ 1.9 $ ( 109.8 )

Net amount reclassified to net income (loss) 2.2 0.0 2.2

Balance, June 30, 2020

$ ( 109.5 ) $ 1.9 $ ( 107.6 )

Reclassifications out of AOCL were included in the consolidated statements of operations as follows:

Three months ended March 31,

Three months ended June 30,

Six months ended June 30,

AOCL Components Location 2021

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Pension Benefits

Three months ended March 31,

Three months ended June 30,

Six months ended June 30,

Service cost $ 0.9 $ 1.1 $ 2.3 $ 2.4

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What changed 10-Q

Item 1. Financial Statements