What changed in this filing

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Item 2. Management’s Discussion and Analysis

2024-05-01 compared with 2023-11-08 · 128 added, 130 removed, 204 unchanged (56% of the section changed)

11 unchanged sentences

Recent Developments

Hawesville temporary curtailment

Department of Energy Award

On March 25, 2024, the U.S.

Department of Energy ("DOE") Office of Clean Energy Demonstrations selected the Company to begin award negotiations for up to $500.0 million in Bipartisan Infrastructure Law and Inflation Reduction Act funding to build a new aluminum smelter as part of the Industrial Demonstrations Program ("IDP").

With the help of this funding, we plan to build the first new U.S.

primary aluminum smelter in 45 years at a site within the Ohio/Mississippi River Basins.

Section 45X of the Inflation Reduction Act

On December 14, 2023, the U.S.

Treasury Department’s issued proposed regulations implementing Section 45X of the Inflation Reduction Act, which provided guidance on rules taxpayers must satisfy to qualify for the tax credit.

The government has incentivized the production of aluminum by offering a tax credit equal to 10% of eligible domestic production costs.

Based on the proposed regulations, for the three months ended March 31, 2024, we recognized $11.9 million as a reduction in Cost of goods sold and $0.7 million as a reduction in Selling, general and administrative expenses within the Consolidated Statements of Operations, resulting in an equally offsetting receivable.

As of March 31, 2024 and December 31, 2023, we recognized a Manufacturing credit receivable of $57.9 million and $59.3 million, respectively, and as of March 31, 2024, we recognized a non-current receivable of $14.0 million within Other assets on the Consolidated Balance Sheets.

Hawesville curtailment

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

For the three and nine months ended September 30, 2023, we incurred curtailment charges of approximately $2.0 million and $13.4 million, including $0.0 million and $9.0 million related to excess capacity charges, respectively.

These charges were partially offset by income related to scrap and materials sales of $0.0 million and $1.2 million for the three and nine months ended September 30, 2023.

Comparatively, for the three and nine months ended September 30, 2022 we recognized $4.5 million and $12.6 million, respectively, of expenses related to accrued wages and severance, triggered by our issuance of the WARN notice and excess capacity charges, partially offset by final plant idling activities.

We also recognized a non-cash other postretirement benefits ("OPEB") curtailment gain, net totaling $8.0 million for the three and nine months ended September 30, 2022.

For the three months ended March 31, 2024 and 2023, we incurred curtailment charges of approximately $0.6 million and $7.0 million, respectively.

These charges were partially offset by income related to scrap and materials sales of $0.5 million and $0.7 million for the March 31, 2024 and 2023 recognized in Other operating expense - net within the Consolidated Statements of Operations.

Acquisition of 55% interest in Jamalco

2 unchanged sentences

The Company's wholly-owned subsidiary, General Alumina Jamaica Limited, is the manager of the Jamalco joint venture.

Jamalco has alumina production capacity of approximately 1.4 million tonnes.

Jamalco has alumina

production capacity of approximately 1.4 million tonnes.

We finalized the purchase accounting and recognized a bargain purchase gain of $245.9 million within the Consolidated Statements of Operations for the three months ended March 31, 2024.

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

1 unchanged sentence

Acquisition of Jamalco for further information.

Holly Power Contract

On October 27, 2023, our wholly-owned subsidiary, Century Aluminum of South Carolina, Inc.

("CASC"), entered into an agreement with the South Carolina Public Service Authority (also known as Santee Cooper) for a new, three-year power contract for Century's Mt.

Holly aluminum smelter.

The contract will be effective as of January 1, 2024, and run through December 2026, and will provide for 295MW of electric power at cost-of-service based rates, allowing the Mt.

Holly smelter to continue operating at its current capacity.

Equipment Failure

Starting in June 2023, we experienced power disruptions due to damage to the Jamalco power generation unit.

The impact of the Jamalco equipment failure in the third quarter was approximately $16.9 million.

We estimate an additional impact to our

financial results in the fourth quarter of approximately $5.0 million.

We believe the equipment has returned to full capacity as of the end of October.

We expect that all losses arising from the power equipment failure will be covered under our insurance policies, less $8.0 million in deductibles.

The equipment returned to full capacity as of the end of October 2023, but we continued to experience some inefficiencies into the three months ended March 31, 2024.

These inefficiencies led to higher production costs of alumina capitalized into inventory, some of which was shipped in the period.

The cumulative impact of the equipment failure from the second quarter of 2023 through March 31, 2024 was approximately $38.8 million.

We are actively engaged with our insurance carriers in connection with this equipment failure to determine the specific amount of coverage available to us, including any applicable deductibles.

Pricing of aluminum

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Information regarding financial contracts is included in Note 15.

Derivatives and risks affiliated with such financial contracts are disclosed specifically in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022.

We saw continued declines in the pricing of aluminum through the third quarter of 2023, which was a continuation of recent price trends that peaked during the first quarter of 2022 and began declining during the second quarter of 2022.

The following table summarizes the average price for primary aluminum per tonne in three months ended September 30, 2023, the three months ended June 30, 2023, and the nine months ended September 30, 2023 and 2022.

Quarter ended Nine months ended

($ per tonne) September 30, 2023 June 30, 2023 September 30, 2023 September 30, 2022

Derivatives and risks associated with such financial contracts are disclosed specifically in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

We saw continued declines in the pricing of aluminum through the first quarter of 2024, which was a continuation of Western demand challenges despite global LME inventory levels near all-time lows in 2023.

The following table summarizes the average price for primary aluminum per tonne for the three months ended March 31, 2024 and 2023.

Three months ended

($ per tonne) March 31, 2024 March 31, 2023

Average LME $ 2,199 $ 2,399

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Results of Operations

The following discussion for the three and nine months ended September 30, 2023 reflects no change in production capacities and the continued curtailment of the Hawesville smelter, at our operating facilities.

The following discussion for the three months ended March 31, 2024 reflects no change in production capacities, other than the continued curtailment of the Hawesville smelter, at our operating facilities.

Our net sales are impacted primarily by the LME price for aluminum, regional and value-added premiums, and the volume and product mix of aluminum we ship during the period.

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Power costs at our Kentucky plants are impacted by capacity demand charges, which are determined based on available power generating capacity in MISO, from which we purchase energy.

The price of such capacity is set by auction annually in April.

This year's auction saw capacity prices return towards normalized levels and has reduced our capacity costs significantly from the prior year.

Our expected capacity demand costs for power are approximately $1.5 million for the twelve months ending May 31, 2024, in addition to the market price of power used.

A substantial increase in energy costs adversely affected our business in 2022 and resulted in the curtailment of our Hawesville facility as described above.

So far in 2023, energy prices in the U.S.

The price of such capacity is set by auction annually in April, with the April 2023 auction resulting in capacity prices returning towards normalized levels which has reduced our capacity costs significantly from the prior year.

Our expected capacity demand costs for power were approximately $1.5 million for the twelve months ending May 31, 2024 , in addition to the market price of power used.

We anticipate the capacity demand power costs resulting from the April 2024 auction for the twelve months ending May 31, 2025 to be approximately $3.1 million .

In 2024, energy prices in the U.S.

and Europe have moderated from their previously elevated levels.

European energy markets impact our Grundartangi operations, which pays a portion of its power costs based on the Nord Pool power market, and our Vlissingen facility in the Netherlands, which utilizes natural gas to produce anodes used in our Grundartangi operations.

European energy markets impact our Vlissingen facility in the Netherlands, which utilizes natural gas to produce anodes used in our Grundartangi operations.

The energy market in Europe has historically been dependent upon imported natural gas from Russia, and the significant reduction in Russian gas supply to Europe has resulted in increased uncertainty with respect to the price and availability of natural gas.

Adverse changes to European natural gas prices or availability could

adversely affect operations at Vlissingen, and in turn operations at Grundartangi, if we are not able to source an alternative supply of anodes.

Adverse changes to European natural gas prices or availability could adversely affect operations at Vlissingen, and in turn operations at Grundartangi, if we are not able to source an alternative supply of anodes.

In general, our results reflect the market cost of alumina on an approximately three-month lag reflecting the terms of our alumina contracts and inventory levels.

Quarter ended Nine months ended

Quarter ended Three months ended

Sequential Year-to-date

September 30, 2023 June 30, 2023 September 30, 2023 September 30, 2022

(in millions, except per share data)

March 31, 2024 December 31, 2023 March 31, 2024 March 31, 2023

Related parties $ 315.0 $ 371.8 $ 315.0 $ 412.2

1 unchanged sentence

Total net sales 489.5 512.3 489.5 552.4

Gross (loss) profit (11.5) 15.9 52.5 66.1

Net (loss) income (45.9) 6.6 (77.9) 99.4

Gross profit 16.5 39.4 16.5 48.1

Net income (loss) 244.7 25.6 244.7 (38.6)

Net loss attributable to noncontrolling interests (2.1) (4.4) (2.1) —

Net (loss) income attributable to Century stockholders (42.0) 7.5 (73.1) 99.4

(LOSS) INCOME ATTRIBUTABLE TO CENTURY STOCKHOLDERS PER COMMON SHARE:

Net income (loss) attributable to Century stockholders 246.8 30.0 246.8 (38.6)

INCOME (LOSS) ATTRIBUTABLE TO CENTURY STOCKHOLDERS PER COMMON SHARE:

Basic $ 2.52 $ 0.31 $ 2.52 $ (0.42)

11 unchanged sentences

102,430 317.6 78,735 210.1 181,165 527.7

95,502 $ 320.3 78,223 $ 283.7 173,725 $ 604.0

139,630 $ 564.8 74,454 $ 273.2 214,084 $ 838.0

134,953 $ 494.8 76,458 $ 247.5 211,411 $ 742.3

(1) Excludes scrap aluminum sales, purchased aluminum and alumina sales.

Quarter ended Nine months ended

Quarter ended Three months ended

Sequential Year-to-date

(in millions) September 30, 2023 June 30, 2023 September 30, 2023 September 30, 2022

(in millions) March 31, 2024 December 31, 2023 March 31, 2024 March 31, 2023

Net sales $ 489.5 $ 512.3 $ 489.5 $ 552.4

Net sales (excluding scrap aluminum, purchased aluminum and alumina sales) decreased by $36.0 million for the three months ended September 30, 2023, compared to the three months ended June 30, 2023, primarily driven by unfavorable LME and regional premium price realizations of $27.8 million and unfavorable volume and sales mix of $8.1 million.

Net sales (excluding scrap aluminum, purchased aluminum and alumina sales) decreased by $669.9 million for the nine months ended September 30, 2023, compared to the nine months ended September 30, 2022, primarily driven by unfavorable LME and regional premium price realizations of $344.5 million and unfavorable volume and sales mix of $325.4 million, attributable to the curtailment of our Hawesville smelter.

The change in net sales of aluminum was partially offset by $107.1 million attributable to Jamalco sales of alumina.

Quarter ended Nine months ended

Net sales decreased by $22.8 million for the three months ended March 31, 2024, compared to the three months ended December 31, 2023, primarily driven by unfavorable volume and sales mix of $16.0 million and unfavorable LME and regional premium price realizations of $4.5 million.

Net sales decreased by $62.9 million for the three months ended March 31, 2024, compared to the three months ended March 31, 2023, primarily driven by unfavorable volume and sales mix of $53.4 million and unfavorable LME and regional premium price realizations of $49.4 million.

The change in net sales of aluminum was offset by $40.1 million attributable to alumina sales by Jamalco, whose operations were not reflected in our results of operations for the three months ended March 31, 2023.

Quarter ended Three months ended

Sequential Year-to-date

(in millions) September 30, 2023 June 30, 2023 September 30, 2023 September 30, 2022

Gross (loss) profit $ (11.5) $ 15.9 $ 52.5 $ 66.1

Gross profit decreased by $27.4 million for the three months ended September 30, 2023, compared to the three months ended June 30, 2023, primarily attributable to unfavorable LME and regional price realization of $27.8 million.

(in millions) March 31, 2024 December 31, 2023 March 31, 2024 March 31, 2023

Gross profit $ 16.5 $ 39.4 $ 16.5 $ 48.1

Gross profit decreased by $22.9 million for the three months ended March 31, 2024, compared to the three months ended December 31, 2023, primarily attributable to the full-year 2023 IRA Section 45X credit recorded in the prior quarter and only one quarter of credit recorded in the current period, resulting in a decrease of $44.6 million, and unfavorable LME and regional price realizations of $4.5 million.

These factors were partially offset by favorable raw material price realization of $22.1 million and favorable power price realization of $3.8 million.

Gross profit decreased by $13.6 million for the nine months ended September 30, 2023, compared to the nine months ended September 30, 2022, primarily driven by unfavorable LME and regional price realization of $344.5 million and unfavorable volume and sales mix of $151.7 million, attributable to the curtailment of our Hawesville smelter.

These factors were partially offset by favorable power price realization of $231.6 million, lower operating costs of $125.1 million primarily attributable to Hawesville curtailment, and favorable raw material price realization of $112.8 million.

Asset impairment charge

Quarter ended Nine months ended

Sequential Year-to-date

(in millions) September 30, 2023 June 30, 2023 September 30, 2023 September 30, 2022

Asset impairment charge $ — $ — $ — $ 159.4

An asset impairment charge of $159.4 million was recognized in the period ended September 30, 2022 as a result of the temporary curtailment of the Hawesville facility, announced during June 2022.

As the curtailment represented a significant adverse change in the extent and manner in which Hawesville will be used, we accordingly evaluated the Hawesville asset group for recoverability which resulted in the recognized impairment charge of $159.4 million.

Gross profit decreased by $31.6 million for the three months ended March 31, 2024, compared to the three months ended March 31, 2023, primarily driven by unfavorable LME and regional price realization of $49.4 million and unfavorable volume and sales mix of $36.9 million.

These factors were partially offset by favorable raw material price realization of $32.3 million and power price realization of $22.4 million, and $11.9 million attributable to the IRA Section 45X credit.

Selling, general and administrative expenses

Quarter ended Nine months ended

Quarter ended Three months ended

Sequential Year-to-date

(in millions) September 30, 2023 June 30, 2023 September 30, 2023 September 30, 2022

(in millions) March 31, 2024 December 31, 2023 March 31, 2024 March 31, 2023

Selling, general and administrative expenses $ 14.1 $ 8.1 $ 14.1 $ 13.4

Selling, general and administrative expenses decreased by $1.2 million for the three months ended September 30, 2023, compared to the three months ended June 30, 2023, primarily driven by share-based compensation costs as a result of quarter over quarter changes in the Company's stock price.

Selling, general and administrative expenses increased by $10.0 million for the nine months ended September 30, 2023, compared to the nine months ended September 30, 2022, primarily driven by an increase in share-based compensation costs resulting from the increase of the Company's stock price between periods and costs related to the Jamalco acquisition of $1.9 million.

Net (loss) gain on forward and derivative contracts

Quarter ended Nine months ended

Selling, general and administrative expenses increased by $6.0 million for the three months ended March 31, 2024, compared to the three months ended December 31, 2023, primarily driven by share-based compensation costs as a result of quarter over quarter changes in the Company's stock price and partially offset by recognition of the full-year 2023 IRA Section 45X tax credit recorded in the prior quarter and only one quarter of credit recorded in the current period .

Selling, general and administrative expenses increased by $0.7 million for the three months ended March 31, 2024, compared to the three months ended March 31, 2023, primarily driven by an increase in share-based compensation costs resulting from the increase of the Company's stock price between periods.

and partially offset by $0.7 million reduction for Section 45X tax credit.

Net gain (loss) on forward and derivative contracts

Quarter ended Three months ended

Sequential Year-to-date

(in millions) September 30, 2023 June 30, 2023 September 30, 2023 September 30, 2022

Net (loss) gain on forward and derivative contracts $ (25.2) $ 9.1 $ (73.7) $ 287.7

Net loss on forward and derivative contracts was $25.2 million for the three months ended September 30, 2023, a change of $34.3 million as compared to the three months ended June 30, 2023.

The transition from gain to loss was primarily driven by increased losses on LME and Nord Pool forward contracts, attributable to fluctuations in the LME and Nord Pool forward prices and volume of contracts.

Net loss on forward and derivative contracts was $73.7 million for the nine months ended September 30, 2023, a change of $361.4 million as compared to the nine months ended September 30, 2022.

The transition from gain to loss was primarily driven by increased losses on LME and Nord Pool derivative contracts due to LME and Nord Pool forward price decreases.

Income tax benefit (expense)

Quarter ended Nine months ended

(in millions) March 31, 2024 December 31, 2023 March 31, 2024 March 31, 2023

Net gain (loss) on forward and derivative contracts $ 7.4 $ 11.9 $ 7.4 $ (57.6)

Net gain on forward and derivative contracts was $7.4 million for the three months ended March 31, 2024, a decrease of $4.5 million as compared to the three months ended December 31, 2023.

The change was primarily driven by decreased losses on LME and heavy fuel oil forward contracts, attributable to favorable fluctuations in the forward prices and volume of contracts settled.

Net gain on forward and derivative contracts was $7.4 million for the three months ended March 31, 2024, a change of $65.0 million as compared to the three months ended March 31, 2023.

The transition from loss to gain was primarily driven by reduced losses on Nord Pool derivative contracts which were settled in December 2023.

Bargain purchase gain

Quarter ended Three months ended

Sequential Year-to-date

(in millions) September 30, 2023 June 30, 2023 September 30, 2023 September 30, 2022

Income tax benefit (expense) $ 11.0 $ 10.0 $ 21.2 $ (64.6)

Income tax benefit increased by $1.0 million for the three months ended September 30, 2023, compared to the three months ended June 30, 2023, primarily driven by changes in the jurisdictional mix of earnings.

Income tax benefit was $21.2 million for the nine months ended September 30, 2023, compared to an expense of $64.6 million for the nine months ended September 30, 2022, primarily driven by changes in the jurisdictional mix of earnings on a year-over-year basis.

(in millions) March 31, 2024 December 31, 2023 March 31, 2024 March 31, 2023

Bargain purchase gain $ 245.9 $ — $ 245.9 $ —

We finalized the purchase accounting related to the acquisition of 55% interest in Jamalco, which was acquired on May 2, 2023, and recognized a bargain purchase gain of $245.9 million for the three months ended March 31, 2024.

Income tax (expense) benefit

Quarter ended Three months ended

Sequential Year-to-date

(in millions) March 31, 2024 December 31, 2023 March 31, 2024 March 31, 2023

Income tax (expense) benefit $ (0.5) $ (6.6) $ (0.5) $ 0.2

Income tax expense decreased by $6.1 million for the three months ended March 31, 2024, compared to the three months ended December 31, 2023, primarily driven by changes in the jurisdictional mix of earnings.

Income tax changed to expense of $0.5 million for the three months ended March 31, 2024, compared to a benefit of $0.2 million for the three months ended March 31, 2023, primarily driven by changes in the jurisdictional mix of earnings on a year-over-year basis.

Income Taxes to the consolidated financial statements included herein for additional information.

5 unchanged sentences

We believe that cash provided from operations and financing activities will be adequate to cover our operations and business needs over the next twelve months.

As of September 30, 2023, we had cash and cash equivalents of approximately $70.3 million and unused availability under our revolving credit facilities of $212.6 million (including $80.0 million under the Vlissingen Facility Agreement referred to below).

As of September 30, 2023, we additionally had restricted cash of $24.4 million, of which $22.9 million represents funds that are restricted to be used on capital expenditures.

Our cash and cash equivalents, restricted cash for capital expenditures and unused availability under our revolving credit facilities comprise our liquidity position, which was $305.8 million as of September 30, 2023.

As of March 31, 2024, we had cash and cash equivalents of approximately $93.5 million and unused availability under our revolving credit facilities of $208.5 million (including $80.0 million under the Vlissingen Facility Agreement referred to below).

Our cash and cash equivalents and unused availability under our revolving credit facilities comprise our liquidity position, which was $302.0 million as of March 31, 2024.

Available Cash

Our available cash and cash equivalents balance at September 30, 2023 was $70.3 million compared to $54.3 million at December 31, 2022.

Our available cash and cash equivalents balance at March 31, 2024 was $93.5 million compared to $88.8 million at December 31, 2023.

Sources and Uses of Cash

Our statements of cash flows are summarized below:

Nine Months Ended September 30,

Three months ended March 31,

(in millions) 2024 2023

Net cash provided by operating activities $ 39.6 $ 57.2

Net cash used in operating activities $ (14.8) $ (0.2)

Net cash used in investing activities (29.7) (14.3)

Net cash provided by financing activities 17.2 38.2

Net cash provided by (used in) financing activities 49.2 (9.4)

Change in cash, cash equivalents and restricted cash $ 4.7 $ (23.9)

The reduction in net cash provided by operating activities during the nine months ended September 30, 2023 compared to the nine months ended September 30, 2022 was primarily driven by timing of payments and receipts.

The reduction in net cash used in investing activities during the nine months ended September 30, 2023 compared to the nine months ended September 30, 2022 was primarily due to the receipt of approximately $25.7 million in proceeds from the sale of the Mt.

Holly Commerce Park Land Sale, cash acquired in excess of cash paid for the acquisition of Jamalco, and lower cash spend on the purchase of property, plant and equipment in the current year.

The reduction in net cash provided by financing activities during the nine months ended September 30, 2023 compared to the nine months ended September 30, 2022 was primarily due to net repayments on our revolving credit facilities, partially offset by the sale of carbon credits and proceeds from the Vlissingen Facility Agreement.

The increase in net cash used in operating activities during the three months ended March 31, 2024 compared to the three months ended March 31, 2023 was primarily driven by timing of payments and receipts.

The increase in net cash used in investing activities during the three months ended March 31, 2024 compared to the three months ended March 31, 2023 was primarily due to higher cash spend on the purchase of property, plant and equipment in the current year attributable to the Grundartangi casthouse project and Jamalco, which was not acquired until the second quarter of 2023.

The change in net cash used in financing activities to net cash provided by financing activities during the three months ended March 31, 2024 compared to the three months ended March 31, 2023 was primarily due to net borrowings on our revolving credit facilities and Grundartangi Casthouse Facility.

Availability Under Our Credit Facilities

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On September 28, 2022, we further amended the Iceland revolving credit facility and increased the facility amount to $100.0 million in the aggregate.

The Iceland revolving credit facility matures in November 2024.

The Iceland revolving credit facility matures in December 2026.

The availability of funds under our credit facilities is limited by a specified borrowing base consisting of certain accounts receivable, inventory and qualified cash deposits which meet the lenders' eligibility criteria.

1 unchanged sentence

decreases in the price of aluminum and/or curtailments of production capacity would decrease our borrowing base by reducing our accounts receivable and inventory balances.

As of September 30, 2023, our U.S.

As of March 31, 2024, our U.S.

revolving credit facility had a borrowing availability of $141.2 million , outstanding borrowings of $17.0 million , and $58.0 million of outstanding letters of credit with total availability of $66.2 million.

Of the outstanding letters of credit, $13.7 million are related to our power commitments and $28.1 million are primarily for the purpose of securing certain debt and workers’ compensation commitments.

As of September 30, 2023, our Iceland revolving credit facility had a borrowing base of $100.0 million and no outstanding borrowings, with total availability of $100.0 million.

As of September 30, 2023, our credit facilities (including the Vlissingen Facility Agreement referred to below) had $212.6 million of net availability after consideration of our outstanding borrowings and letters of credit.

Of the outstanding letters of credit, $13.7 million are related to our power commitments, $17.3 million are related to raw material security, and the remaining $27.1 are primarily for the purpose of securing certain debt and workers’ compensation commitments.

As of March 31, 2024, our Iceland revolving credit facility had a borrowing base of $94.3 million and $32.0 million outstanding borrowings, with total availability of $62.3 million .

As of March 31, 2024, our credit facilities (including the Vlissingen Facility Agreement referred to below) had $208.5 million of net availability after consideration of our outstanding borrowings and letters of credit.

We may borrow and make repayments under our credit facilities in the ordinary course based on a number of factors, including the timing of payments from our customers and payments to our suppliers.

2 unchanged sentences

revolving credit facility is less than or equal to $25.0 million, or 10% of the borrowing base, but not less than $17.85 million.

We intend to maintain availability to comply with these levels any time we would not meet the ratio, which could limit our ability to access the full

amount of our availability under our U.S revolving credit facility.

We intend to maintain

availability to comply with these levels any time we would not meet the ratio, which could limit our ability to access the full amount of our availability under our U.S revolving credit facility.

Our Iceland revolving credit facility contains a covenant that requires Grundartangi to maintain a minimum equity ratio.

As of September 30, 2023, we were in compliance with all such covenants or maintained availability above such covenant triggers.

As of March 31, 2024, we were in compliance with all such covenants or maintained availability above such covenant triggers.

Grundartangi Casthouse Facility

3 unchanged sentences

The Casthouse Facility bears interest at a rate plus applicable margin as defined within the agreement.

As of September 30, 2023 there were $86.9 million in outstanding borrowings under the Casthouse Facility.

As of March 31, 2024 there were $130.0 million in outstanding borrowings under the Casthouse Facility.

The Casthouse Facility also contains customary covenants, including restrictions on mergers and acquisitions, indebtedness, preservation of assets, and dispositions of assets and contains a covenant that requires Grundartangi to maintain a minimum equity ratio.

As of September 30, 2023, we were in compliance with all such covenants.

As of March 31, 2024, we were in compliance with all such covenants.

Senior Notes and Convertible Senior Notes

16 unchanged sentences

Our wholly-owned subsidiary, Grundartangi, entered into a Term Facility Agreement with Arion Bank hf, dated September 2022, (the "Iceland Term Facility") to provide for borrowings up to €13.6 million.

Under the Iceland Term Facility, repayments of principal amounts will be made in equal monthly installments, the first payment occurring in February 2023, with the remainder of the principal amount to be paid no later than the termination date in January 2024.

Borrowings under the Iceland Term Facility bear interest at a rate equal to 3.2% plus EUR EURIBOR 1 month as published at any time by the European Money Markets Institute.

As of September 30, 2023, there were €4.5 million ($4.8 million , based on the prevailing exchange rate on September 30, 2023) in outstanding borrowings under the Iceland Term Facility.

Under the Iceland Term Facility, repayments of principal amounts were made in equal monthly installments, the first payment occurring in February 2023, with the remainder of the principal amount paid in January 2024.

Borrowings under the Iceland Term Facility bore interest at a rate equal to 3.2% plus EUR EURIBOR 1 month as published at any time by the European Money Markets Institute.

The Iceland Term Facility has been repaid in full and has terminated pursuant to its terms in the first quarter of 2024.

Vlissingen Facility Agreement

5 unchanged sentences

Amounts drawn, if any, under the Vlissingen Facility Agreement are expected to be used for general corporate and working capital purposes of Century and its subsidiaries.

As of September 30, 2023, there were $10.0 million in outstanding borrowings under the Vlissingen Facility Agreement.

As of March 31, 2024, there were $10.0 million in outstanding borrowings under the Vlissingen Facility Agreement.

Supplemental Guarantor Financial Information

1 unchanged sentence

securities that are guaranteed by certain of the Company's subsidiaries.

As of September 30, 2023, we have not issued any debt securities pursuant to the Universal Shelf Registration Statement.

As of March 31, 2024, we have not issued any debt securities pursuant to the Universal Shelf Registration Statement.

However, any securities that we may issue in the future may limit our ability, and the ability of certain of our subsidiaries, to pay dividends or make distributions in respect of capital stock.

9 unchanged sentences

The Company’s or Guarantors’ amounts due from, amounts due to, and transactions with the Non-Guarantors are disclosed below:

September 30, 2023 December 31, 2022

March 31, 2024 December 31, 2023

Current assets $ 384.2 $ 361.5

2 unchanged sentences

Non-current liabilities 492.7 485.7

Nine Months Ended September 30, 2023

Three months ended March 31, 2024

Net sales $ 393.8

2 unchanged sentences

Net loss 246.7

As of September 30, 2023 and December 31, 2022, an intercompany receivable due to the Company and Guarantors from the Non-Guarantors totaled $19.0 million and $18.2 million, respectively, and an intercompany non-current loan due to the Company from the Non-Guarantors totaled $377.2 million and $466.3 million, respectively.

As of September 30, 2023, an intercompany current loan due to the Company from the Non-Guarantors totaled $10.3 million.

There was no intercompany current loan as of December 31, 2022.

As of March 31, 2024 and December 31, 2023, an intercompany receivable due to the Company and Guarantors from the Non-Guarantors totaled $40.7 million and $48.7 million, respectively, and an intercompany non-current loan due to the Company from the Non-Guarantors totaled $392.6 million and $384.9 million, respectively.

As of March 31, 2024 and December 31, 2023, an intercompany current loan due to the Company from the Non-Guarantors totaled $3.0 million and $2.9 million, respectively.

As of March 31, 2024, an intercompany current loan due from the Non-Guarantors to the Company totaled $50.3 million.

There was no intercompany current loan due from the Non-Guarantors to the Company as of December 31, 2023.

Contingent Commitments

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This contingent obligation consists of the aggregate payments made to Big Rivers by the third party on CAKY’s behalf in excess of the agreed upon base amount under the long-term cost-based power contract with Kenergy.

As of September 30, 2023, the principal and accrued interest for the contingent obligation was $30.5 million, which was fully offset by a derivative asset.

As of March 31, 2024, the principal and accrued interest for the contingent obligation was $31.2 million, which was fully offset by a derivative asset.

We may be required to make installment payments for the contingent obligation in the future.

These payments are contingent based on the LME price of primary aluminum and the level of Hawesville’s operations.

As of September 30, 2023, based on the LME forward market prices and our expected level of Hawesville operations, we believe that we will not be required to make payments on the contingent obligation during the term of the agreement, which expires in 2028.

As of March 31, 2024, based on the LME forward market prices and our expected level of Hawesville operations, we believe that we will not be required to make payments on the contingent obligation during the term of the agreement, which expires in 2028.

There can be no assurance that circumstances will not change thus accelerating the timing of such payments.

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Pursuant to the terms of the PBGC Settlement Agreement, we agreed to make additional contributions (above any minimum required contributions) to our defined benefit pension plans totaling approximately $17.4 million.

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

Under certain circumstances, in periods of lower primary aluminum prices relative to our cost of operations, we were able to defer one or more of these payments, provided that we

provide the PBGC with acceptable security for such deferred payments.

We historically elected to defer certain payments under the PBGC Settlement Agreement and provided the PBGC with the appropriate security.

In October 2021, we amended the

PBGC Settlement Agreement (the "Amended PBGC Settlement Agreement") such that we removed the deferral mechanism and agreed to contribute approximately $2.4 million per year to our defined benefit pension plans for a total of approximately $9.6 million, over four years beginning on November 30, 2022 and ending on November 30, 2025, subject to acceleration if certain terms and conditions are met in such amendment.

As of September 30, 2023, we made contributions of $6.9 million, including $4.5 million during the three months ended September 30, 2023, related to the Amended PBGC Settlement Agreement.

We did not make any contributions for the three months ended September 30, 2022.

In October 2021, we amended the PBGC Settlement Agreement (the "Amended PBGC Settlement Agreement") such that we removed the deferral mechanism and agreed to contribute approximately $2.4 million per year to our defined benefit pension plans for a total of approximately $9.6 million, over four years beginning on November 30, 2022 and ending on November 30, 2025, subject to acceleration if certain terms and conditions are met in such amendment.

As of March 31, 2024, we made contributions of $6.9 million rela ted to the Amended PBGC Settlement Agreement.

We did not make any contributions for the three months ended March 31, 2024 and 2023.

Section 232 Aluminum Tariff

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Accordingly, we do not believe there will be any material changes to the current tariffs in the near future.

On January 17, 2023, our wholly owned subsidiary, Mt.

Holly Commerce Park LLC, entered into a binding agreement (the "Mt.

Holly Land Sale Agreement"), subject to ordinary course conditions, to sell approximately 133 acres of land for approximately $28.5 million.

On September 12, 2023, the Mt.

Holly Land Sale Agreement was completed at a revised purchase price of $25.7 million.

The proceeds from this sale are restricted to be used on capital expenditures.

We previously formed the commerce park, located near our Mt.

Holly smelter, to develop excess land at the site and to assist the county with bringing additional business and commerce to the area.

In August 2022, President Biden signed the IRA into law.

The IRA provides for substantial tax credits and incentives for the development of critical minerals (including aluminum), renewable energy, clean fuels, electric vehicles, and supporting infrastructure, among other provisions.

Section 45X of the IRA contains a production tax credit equal to 10% of certain eligible production costs, including, without limitation, labor, energy, depreciation and amortization and overhead expenses.

On December 14, 2023, the U.S.

Department of the Treasury and the Internal Revenue Service released proposed rules to provide guidance on the production tax credit requirements under Internal Revenue Code Section 45X (the “Proposed Regulations”).

The Proposed Regulations provide guidance on rules that taxpayers must satisfy to qualify for the Section 45X tax credit.

For the quarter ended March 31, 2024, we recognized $11.9 million as a reduction in Cost of goods sold and $0.7 million as a reduction in Selling, general and administrative expenses within the Consolidated Statements of Operations, resulting in an equally offsetting receivable.

As of March 31, 2024 and December 31, 2023, we recognized a Manufacturing credit receivable of $57.9 million and $59.3 million, respectively, and as of March 31, 2024, we recognized a noncurrent receivable of $14.0 million within Other assets on the Consolidated Balance Sheets.

During 2021, we announced plans for construction of a new billet casthouse at Grundartangi.

The Grundartangi casthouse project began in late 2021 and is expected to continue through the second half of 2023.

The Grundartangi casthouse project began in late 2021 and is expected to continue through the first half of 2024.

The Grundartangi casthouse project will be fully funded through the Casthouse Facility.

The project is progressing and is expected to ship first billets out of the casthouse in the first quarter of 2024, subject to market conditions.

The project is progressing and is expected to ship first billets out of the casthouse during the second half of 2024, subject to market conditions.

In 2011, our Board of Directors authorized a $60.0 million common stock repurchase program and during the first quarter of 2015, our Board of Directors increased the size of the program by $70.0 million.

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We made no repurchases during the years ended 2021, 2022, and 2023.

As of September 30, 2023, we had $43.7 million remaining under the repurchase program authorization.

As of March 31, 2024, we had $43.7 million remaining under the repurchase program authorization.

The repurchase program may be expanded, suspended or discontinued by our Board, in its sole discretion, at any time.

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("CAWV") filed a class action complaint for declaratory judgment against the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union ("USW"), the USW’s local and certain CAWV retirees, individually and as class representatives ("CAWV Retirees"), seeking a declaration of CAWV’s rights to modify/terminate retiree medical benefits.

Later in November 2009, the USW and representatives of a retiree class filed a separate suit against CAWV, Century Aluminum Company, Century Aluminum Master Welfare Benefit Plan, and various John Does with respect to the foregoing.

Later in November 2009, the USW and representatives of a retiree class filed a separate suit against CAWV, Century Aluminum Company, Century

Aluminum Master Welfare Benefit Plan, and various John Does with respect to the foregoing.

On August 18, 2017, the District Court for the Southern District of West Virginia approved a settlement agreement in respect of these actions, pursuant to which, CAWV agreed to make payments into a trust for the benefit of the CAWV Retirees in the aggregate amount of $23.0 million over the course of ten years.

Upon approval of the settlement, we paid $5.0 million to the aforementioned trust in September 2017 and agreed to pay the remaining amounts under the settlement agreement in annual increments of $2.0 million for nine years.

At September 30, 2023, we had $2.0 million in other current liabilities and $3.2 million in other liabilities related to this agreement.

At March 31, 2024, we had $2.0 million in other current liabilities and $3.4 million in other liabilities related to this agreement.

We are a defendant in several actions relating to various aspects of our business.

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and international markets and economies may adversely affect our liquidity, our ability to access the debt or capital markets and our financial condition.

Capital expenditures incurred for the nine months ended September 30, 2023 were $18.3 million, excluding expenditures of $44.4 million associated with the Grundartangi casthouse project.

We estimate our total capital spending in 2023, excluding the Grundartangi casthouse project, will be approximately $10 to $15 million, related to our ongoing investment and sustainability projects at our plants.

Capital expenditures incurred for the three months ended March 31, 2024 were $12.8 million, excluding expenditures of $16.8 million associated with the Grundartangi casthouse project.

We estimate our total capital spending in 2024, excluding the Grundartangi casthouse project, will be approximately $20 to $30 million, related to our ongoing investment and sustainability projects at our aluminum smelters and alumina refinery.

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-Q

Item 2. Management’s Discussion and Analysis