What changed in this filing

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Item 1. Business

2024-03-15 compared with 2023-02-27 · 54 added, 53 removed, 236 unchanged (31% of the section changed)

4 unchanged sentences

We produced approximately 690,000 tonnes of primary aluminum in 2023.

In addition to our primary aluminum assets, we own a carbon anode production facility located in the Netherlands ("Vlissingen").

In addition to our primary aluminum assets, we have a 55% joint venture interest in the Jamalco bauxite mining operation and alumina refinery in Jamaica ("Jamalco").

The remaining 45% interest in Jamalco is indirectly owned by the Government of Jamaica.

Century's share of Jamalco's production capacity is approximately 770,000 tpy.

The Jamalco refinery supplies a substantial amount of the alumina used for production of primary aluminum at our aluminum smelter in Grundartangi, Iceland.

We also own a carbon anode production facility located in the Netherlands ("Vlissingen").

Carbon anodes are consumed in the production of primary aluminum.

5 unchanged sentences

We believe that our focus on lowering costs and decommoditizing our product line will enable us to deliver profitable long-term growth and differentiate us from overseas competitors with longer supply lines into the markets we serve.

Century conducts our business with a focus on sustainability, including the health and safety of our people and the communities in which we operate.

We conduct our business with a focus on sustainability, including the health and safety of our people and the communities in which we operate.

Through our Natur-Al TM product line, we are able to provide our customers with world-class, low-carbon aluminum products that demonstrate our commitment to sustainability.

22 unchanged sentences

In late 2021 Century began construction of a new billet casthouse at Grundartangi (the “Casthouse Project”).

The new value-added casthouse will have a capacity of 150,000 tonnes of billet production and is expected to start production in the first quarter of 2024.

The Casthouse Project will also increase Grundartangi’s annual capacity to produce primary foundry alloys from its current 60,000 tonnes of capacity to 120,000 tonnes of capacity.

The new casthouse will have a capacity to turn 150,000 tonnes of Grundartangi's existing primary aluminum production into value-added billet and is expected to start production in the first quarter of 2024.

The Casthouse Project will also increase Grundartangi’s annual capacity to produce value-added primary foundry alloys from its current 60,000 tonnes of capacity to 120,000 tonnes of capacity.

This incremental billet and primary foundry alloy capacity displaces standard-grade ingot production, raising expected total value-added product premiums for Grundartangi products.

2 unchanged sentences

Hawesville has an annual production capacity of approximately 250,000 tonnes of primary aluminum.

In the third quarter of 2022, we curtailed 100% of production at Hawesville.

We expect that Hawesville's operations will remain curtailed until market conditions permit, including the resumption of normalized energy prices and aluminum prices maintaining levels that are supportive of the on-going costs and capital expenditures necessary to restart and operate the plant.

In August 2022, we fully curtailed production at the Hawesville facility and expect to continue to maintain the plant with the intention of being able to restart operations if and when market conditions permit, including the resumption of normalized energy prices and aluminum prices maintaining levels that can support the on-going costs and capital expenditures necessary to restart and operate the plant.

Sebree, located adjacent to the Green River near Robards, Kentucky, is a primary aluminum reduction facility owned and operated by our wholly-owned subsidiary, Century Aluminum Sebree LLC ("Century Sebree").

17 unchanged sentences

Each of our smelters in the United States produces anodes at on-site facilities.

Bauxite Mining and Alumina Refining Facility

On May 2, 2023, our wholly-owned subsidiary, Century Aluminum Jamaica Holdings, Inc., acquired for $1.00 a 55% interest in Jamalco, an unincorporated joint venture with Clarendon Alumina Production Limited ("CAP"), which is owned by the Government of Jamaica.

Jamalco is engaged in bauxite mining and alumina refining in Jamaica.

The Company's newly

acquired, wholly-owned subsidiary, General Alumina Jamaica Limited, is the managing partner of the Jamalco joint venture.

Jamalco has alumina production capacity of approximately 1.4 million tonnes, and produced approximately 1.0 million tonnes of alumina in 2023.

For the period from May 2, 2023 to December 31, 2023 approximately 287,000 tonnes, or 29% of Jamalco's alumina production was sold to Grundartangi.

Our historical financial statements for periods prior to May 2, 2023 do not include the results of Jamalco.

Refer to Note 2.

Acquisition of Jamalco for further information.

Pricing for primary aluminum products is typically comprised of three components:

1 unchanged sentence

Our operating results are highly sensitive to changes in the LME price of primary aluminum and the amount of regional premiums and value-added product premiums.

As a result, from time to time, we assess the appropriateness of mitigating the effects of fluctuations in the aluminum price through the use of fixed-price commitments, LME-linked supply contracts and other

financial instruments.

Quantitative and Qualitative Disclosures about Market Risk for further discussion of how we manage our exposure to market risk.

1 unchanged sentence

We have historically derived substantially all of our consolidated net sales of primary aluminum from a small number of customers.

For the year ended December 31, 2022, we derived approximately 60% of our consolidated sales from Glencore plc and its affiliates (together, "Glencore") and approximately 12% of our consolidated sales from Southwire Company ("Southwire").

Both Glencore and Southwire purchased aluminum produced at our U.S.

For the year ended December 31, 2023, we derived approximately 73.8% of our consolidated sales from Glencore plc and its affiliates (together, "Glencore").

Glencore purchased aluminum produced at our U.S.

smelters at prices based on the LME price for primary aluminum plus the Midwest premium plus any additional market-based product premiums.

Glencore also purchased aluminum produced at our Grundartangi, Iceland smelter at prices 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 pursua nt to which we sell certain amounts of alumina at market-based prices.

Glencore beneficially owns 42.9% of our outstanding common stock (46.0% on a fully diluted basis).

Related Party Transactions to the consolidated financial statements included herein for additional information concerning our relationship with Glencore.

Related Party Tr ansactions to the consolidated financial statements included herein for additional information concerning our relationship with Glencore.

We currently have agreements in place to sell a substantial portion of our 2024 production to Glencore.

1 unchanged sentence

Key Production Costs

Alumina, electrical power, calcined petroleum coke and liquid pitch (the key raw materials for carbon anodes), and labor are the principal components of our cost of production.

Alumina, electrical power, carbon products, caustic soda, natural gas, heavy fuel oil and labor are the principal components of our cost of production.

These components together represented over 79% of our cost of goods sold for the year ended December 31, 2023.

3 unchanged sentences

While Century may enter into other purchases of alumina as market conditions change, a summary of our principal alumina supply agreements is provided below:

Concord Resources Ltd.

Approximately 180,000 tpy Through December 2022 LME-linked

Glencore Approximately 260,000 tpy Through December 2022 Fixed and API-linked components

Variable Through December 2023 LME-linked

Kalon Approximately 180,000 tpy

Through June 2023 LME-linked and API-linked components

Concord Resources Ltd.

Approximately 108,000 tpy Through December 2023 Fixed and API-linked components

Glencore Variable Through December 2028 LME-linked

Concord Resources Ltd.

2 unchanged sentences

Fixed, LME-linked, and API-linked components

(1) Under the terms of this agreement, Glencore will provide alumina supply for all of Mt.

Holly's requirements for the calendar years 2022 and 2023.

(1) "API" refers to a published alumina price index.

1 unchanged sentence

The table below summarizes our long-term power supply agreements:

Grundartangi Landsvirkjun Through 2026 - 2036 Variable rate based on (i) the LME price for primary aluminum (~70%) or (ii) the Nord Pool power market for 161MW (~30%) though 2023;

Facility Supplier Term Pricing

Grundartangi Landsvirkjun Through 2026 - 2036 Variable rate based on (i) the LME price for primary aluminum (~70%) or (ii) the Nord Pool power market for 161MW (~30%) through 2023;

Nord Pool converts to a fixed rate plus a small variable component from 2024 - 2026

1 unchanged sentence

HS Orka hf ("HS")

Hawesville Kenergy Corporation ("Kenergy") Through December 31, 2023 (1)

Hawesville Kenergy Corporation ("Kenergy") Through May 31, 2028

Variable rate based on market prices

Sebree Kenergy Through December 31, 2023 (1)

Sebree Kenergy Through May 31, 2028

Variable rate based on market prices

Holly Santee Cooper Through December 31, 2026 Cost of service based rate

(1) The power supply arrangement with Kenergy has an effective term through December 2023.

The arrangement with EDF to act as our market participant with MISO has an effective term through May 2023.

Electrical power represents one of the largest components of our cost of goods sold.

6 unchanged sentences

In September 2022, this agreement was amended to provide for 42 MW at a fixed price and 119 MW at rates linked to Nord Pool plus transmission through 2023, and, beginning January 1, 2024, through December 31, 2026, this agreement allows for fixed rates plus a small variable rate portion of the full 182 MW.

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

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

Historically, all of the power supplied to Grundartangi has been delivered at prices indexed to the price of primary aluminum.

1 unchanged sentence

The vast majority of this market price has been fixed through derivative financial contracts.

We continue to monitor power prices and may enter into further similar contracts in the future.

Each power purchase agreement contains take-or-pay obligations with respect to a significant percentage of the total committed and available power under such agreement.

CAKY is party to a power supply arrangement with Kenergy and EDF Trading North America, LLC ("EDF") which provides market-based power to the Hawesville smelter.

Under this arrangement, the power companies purchase power on the open market and pass it through to Hawesville at Midcontinent Independent System Operator ("MISO") pricing plus transmission and other costs.

The power supply arrangement with Kenergy has an effective term through December 2023.

The arrangement with EDF to act as our market participant with MISO has an effective term through May 2023.

On April 26, 2022, EDF gave notice that it would no longer serve as the MISO Market Participant for Hawesville.

The notice terminated EDF's contract, effective May 31, 2023, to purchase power from MISO for resale to Kenergy, which then resells the power to Hawesville.

Century is in discussions with other companies, currently authorized as MISO Market Participants, to replace EDF and expects to have a replacement Market Participant in place prior to the expiration of the contract with EDF.

In connection with the temporary curtailment of production at Hawesville, energy use at the smelter has been significantly reduced.

However, such reduction in energy use does not reduce Hawesville's capacity payment obligation to MISO which extends through May 2023.

Century Sebree is party to a power supply arrangement with Kenergy and EDF which provides market-based power to the Sebree smelter.

Similar to the arrangement at Hawesville, the power companies purchase power on the open market and pass it through to Sebree at MISO pricing plus transmission and other costs.

The power supply arrangement with Kenergy has an effective term through December 2023.

The arrangement with EDF to act as our market participant with MISO has an effective term through May 2023.

On April 26, 2022, EDF gave notice that it would no longer serve as the MISO Market Participant for Sebree.

The notice terminated EDF's contract, effective May 31, 2023, to purchase power from MISO for resale to Kenergy, which then resells the power to Sebree.

CAKY is party to a power supply arrangement with Kenergy and Century Marketer, LLC (“Century Marketer"), Century's wholly-owned subsidiary that acts as a MISO market participant.

Under this arrangement, Hawesville gets access to power at Midcontinent Independent System Operator ("MISO") pricing plus transmission and other costs.

As the MISO Market Participant, Century Marketer purchases power from MISO for resale to Kenergy, which then resells the power to Hawesville.

The power supply arrangement with Kenergy has an effective term through May 2028.

Century Sebree is party to a power supply arrangement with Kenergy and Century Marketer, Century's wholly-owned subsidiary that acts as a MISO market participant.

Under this arrangement, Sebree gets access to power at Midcontinent Independent System Operator ("MISO") pricing plus transmission and other costs.

As the MISO Market Participant, Century Marketer purchases power from MISO for resale to Kenergy, which then resells the power to Sebree.

The power supply arrangement with Kenergy has an effective term through May 2028.

CASC is party to an agreement with Santee Cooper for power to the Mt.

4 unchanged sentences

Holly to produce at 75% of full production capacity.

The agreement with Santee Cooper has a term through December 31, 2023.

The agreement with Santee Cooper had a term through December 31, 2023.

On October 27, 2023, CASC entered into an agreement with Santee Cooper for a new three-year power contract for Mt.

The contract is effective January 1, 2024 through December 2026 and will provide for 295MW of electric power at rates allowing the Mt.

Holly smelter to continue operating at its current capacity.

Commitments and Contingencies to the consolidated financial statements included herein for additional information concerning our power arrangements.

2 unchanged sentences

As of December 31, 2023, we had 2,939 employees.

Of these, 1,186 were domiciled in the United States, 694 in Iceland and 76 in the Netherlands.

Of these, 1,211 were domiciled in the United States, 932 in Jamaica, 719 in Iceland and 77 in the Netherlands.

Health, Safety and Wellness.

3 unchanged sentences

We emphasize the importance of safety and seek to create a safety conscious culture by, among other things, including safety performance metrics and KPIs in our annual incentive awards to our executives.

The safety focus of the Company is evident in our approach to the COVID-19 pandemic over recent years.

During this time, we have taken, and continue to take, measures to protect the health and safety of our employees during the pandemic, including requirements regarding wearing masks, social distancing, cleaning and sanitation procedures, and temperature checks as well as providing vaccination clinics on site.

We have also developed and implemented protocols across our operations to address actual and suspected COVID-19 cases and potential exposure of our employees.

Compensation and Benefits.

14 unchanged sentences

Labor Agreements

The bargaining unit employees at our Grundartangi, Vlissingen, Hawesville and Sebree facilities are represented by labor unions, representing 59% of our total workforce.

The bargaining unit employees at our Grundartangi, Vlissingen, Hawesville, Sebree and Jamalco facilities are represented by labor unions, representing 60% of our total workforce.

Our employees at Mt.

8 unchanged sentences

Through May 31, 2024

Jamalco Union of Technical, Administrative, and Supervisory Personnel ("UTASP")

Through December 31, 2023

Approximately 87% of Grundartangi’s workforce is represented by five labor unions, governed by a labor agreement that establishes wages and work rules for covered employees.

9 unchanged sentences

Century Sebree's labor agreement with USW for its employees is effective through October 28, 2028.

Approximately 62% of Jamalco’s work force is represented by the Union of Technical, Administrative, and Supervisory Personnel ("UTASP") through separately negotiated labor agreements for hourly and salaried employee groups.

Both contracts are effective through December 31, 2023.

Jamalco is currently in the process of negotiating new contracts with both the salaried and hourly employee groups.

The market for primary aluminum is global, and demand for aluminum varies widely from region to region.

18 unchanged sentences

The new value-added casthouse will be able to produce up to 150,000 tonnes of billet from existing Grundartangi production and is expected to start production in the first quarter of 2024.

The billet produced at the Grundartangi casthouse is expected to be low-carbon aluminum or Natur-Al TM .

The billet produced at the Grundartangi casthouse is expected to be low-carbon aluminum or Natur-Al™ .

Since our purchase of the Vlissingen facility, we have completed a variety of expansion projects and efficiency programs in order to more than double its production capacity.

1 unchanged sentence

We continue to pursue additional internal growth opportunities to maximize efficiencies and improve overall performance.

Additionally, with our acquisition of a 55% interest in Jamalco, we secured a predictable, long-term supply of alumina, our most critical raw material, and achieved increased transparency and control of our supply chain.

Our vertical integration with Jamalco allows us to integrate our aluminum smelting operations with this critical upstream supply of bauxite and alumina to create a more balanced and robust operational footprint, resulting in an organization that is better positioned to deliver strong performance through industry cycles.

Sustainability.

Our Natur-Al™ aluminum produced at our Grundartangi facility has one of the lowest carbon footprints in the industry due to Grundartangi’s access to hydroelectric and geothermal power sources.

Our Grundartangi facility (along with our corporate headquarters in Chicago, Illinois) have also been certified by the Aluminium Stewardship Initiative (ASI) for responsible production, sourcing and stewardship of aluminum.

Our Grundartangi facility (along with our corporate headquarters in Chicago, Illinois) have also been certified by the Aluminum Stewardship Initiative (ASI) for responsible production, sourcing and stewardship of aluminum.

In addition to providing additional value to our customers, our low carbon footprint in Iceland mitigates our exposure to current or future carbon regulations.

57 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business