What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2025-05-08 compared with 2024-11-04 · 135 added, 247 removed, 99 unchanged (79% of the section changed)

Management’s Discussion and Analysis of Financial Condition and Results of Operations.

This Management’s Discussion and Analysis (“MD&A”) provides information that management believes is relevant to an assessment and understanding of the consolidated financial condition and results of operations of Century Aluminum Company and should be read in conjunction with the accompanying consolidated financial statements and related notes thereto.

This Management’s Discussion and Analysis ("MD&A") provides information that management believes is relevant to an assessment and understanding of the consolidated financial condition and results of operations of Century Aluminum Company and its subsidiaries (collectively, "Century," the "Company," "our" and "we") and should be read in conjunction with the accompanying consolidated financial statements and related notes thereto.

This MD&A contains "forward-looking statements" - see "Forward-Looking Statements" above.

We are a global producer of primary aluminum with aluminum reduction facilities, or "smelters," in the United States and Iceland.

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.

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

We also own a carbon anode production facility located in the Netherlands.

We are a global producer of alumina and primary aluminum with production facilities in the United States, Iceland and Jamaica.

Our primary aluminum smelters are concentrated in the U.S.

and Iceland, while in Jamaica we maintain a 55% joint venture interest in the Jamalco alumina refinery, from which we off-take a proportionate amount of alumina production.

The majority of our Jamalco off-take is consumed internally at our primary aluminum smelters in a vertical integration model.

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

Carbon anodes are consumed in the production of primary aluminum.

Vlissingen supplies carbon anodes to our aluminum smelter in Iceland.

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

The key determinants of our results of operations and cash flows from operations are as follows:

3 unchanged sentences

Recent Developments

Section 232 Aluminum Tariffs

In March 2018, the U.S.

implemented a 10% tariff on imported primary aluminum products into the U.S.

These tariffs are intended to protect U.S.

national security and incentivize primary aluminum production in the U.S., reducing reliance on imports and ensuring that domestic producers, like Century, can supply all the aluminum necessary for critical industries and national defense.

In addition to primary aluminum products, the tariffs also cover certain other semi-finished products.

All imports that directly compete with our products are covered by the tariff.

In February 2025, President Trump issued a new Presidential Proclamation directing the tariff rate on imported primary aluminum to be increased from 10% to 25% and for all existing country exemptions or product exclusion to be ended, in each case effective March 12, 2025.

Since the implementation of these changes to the Section 232 tariff program, the Midwest Premium has increased, which we expect will have a material positive impact on our financial position and results of operations.

Department of Energy Award

On January 10, 2025, the Company entered into a Cooperative Agreement with the U.S.

Department of Energy's ("DOE") Office of Clean Energy Demonstrations 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.

Since that time, the issuance of certain Executive Orders, including the Unleashing American Energy Executive Order on January 20, 2025, has required an immediate pause in the disbursement of funds appropriated through the Inflation Reduction Act pending an ongoing review period.

The Company is currently evaluating this Executive Order and other related memoranda to determine what, if any, impact they might have on or our previously announced DOE funding.

Section 45X of the Inflation Reduction Act

2 unchanged sentences

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

Based on the final regulations, for the three and nine months ended September 30, 2024, we recognized $47.3 million and $69.9 million as a reduction in Cost of goods sold and $0.8 million and $2.0 million, respectively, as a reduction in Selling, general and administrative expenses within the Consolidated Statements of Operations, resulting in an equally offsetting receivable.

As of September 30, 2024 and December 31, 2023, we recognized a manufacturing credit receivable of $78.8 million and $59.3 million, respectively, and as of September 30, 2024, we recognized a non-current manufacturing credit receivable of $52.4 million within Other assets on the Consolidated Balance Sheets.

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.

Based on the final regulations, we have recognized a receivable and corresponding offset to cost of

goods sold and selling, general and administrative expenses.

Any changes to the final regulations could result in a subsequent adjustment to the estimated credit as of March 31, 2025.

Acquisition of 55% interest in Jamalco

On May 2, 2023, our wholly-owned subsidiary, CAJH, acquired for $1.00 all of the outstanding share capital of GAHL, the indirect holder of a 55% interest in Jamalco, an unincorporated joint venture with CAP, which is owned by the Government of Jamaica.

On May 2, 2023, our wholly-owned subsidiary, Century Aluminum Jamaica Holdings, Inc.

("CAJH"), completed the acquisition of all the outstanding share capital of General Alumina Holdings Limited ("GAHL"), the holder of a 55% interest in Jamalco, an unincorporated joint venture with the Government of Jamaica through its controlled entity Clarendon Alumina Production Limited ("CAP").

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

The Company's indirect wholly-owned subsidiary, GAJL, is the manager of Jamalco.

The Company's wholly-owned subsidiary, General Alumina Jamaica Limited ("GAJL"), is the managing partner of the Jamalco joint venture.

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 nine months ended September 30, 2024.

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.

Equipment Failure

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

The equipment returned to full capacity as of the end of October 2023.

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

The cumulative impact of the equipment failure was approximately $38.8 million.

Hurricane Beryl

In early July 2024, Hurricane Beryl temporarily impacted our operations in Jamaica.

Jamalco’s production facilities escaped significant damage, but the port facility was impacted by the storm, where a portion of the alumina conveyor was damaged.

Jamalco's bauxite mining and alumina production joint venture returned to full production on July 12, 2024.

Jamalco secured alternative port arrangements to allow for alumina shipments to its customers while the repairs to the conveyor were ongoing.

On September 17, 2024, we resumed normal shipping operations at Jamalco’s Rocky Point port following the completion of repairs to the port.

Hawesville curtailment

In August 2022 we fully curtailed production at the Hawesville facility.

We continue to explore all options related to the Hawesville facility.

For the three and nine months ended September 30, 2024, we incurred curtailment charges of approximately $2.7 million and $5.0 million, respectively.

These charges were partially offset by income related to scrap and materials sales of $0.5 million for the nine months ended September 30, 2024.

There were no scrap and materials sales as of the three months ended September 30, 2024.

Comparatively, 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 demand capacity charges for power, 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

We recognized a bargain purchase gain of $245.9 million in connection to the acquisition within the Consolidated Statements of Operations for the three months ended March 31, 2024.

Jamalco Equipment Failure

In June 2023, Jamalco experienced a power disruption caused by damage to its power generation unit.

The equipment failure resulted in a loss of production at Jamalco of approximately 84,000 tonnes for the year ended December 31, 2023.

The impact of the equipment failure on gross margin was approximately $30.4 million.

Despite returning the equipment to full capacity as of the end of October 2023, we continued to see some inefficiencies into the first quarter of 2024.

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

Pricing of Aluminum

4 unchanged sentences

Each of these price components has its own drivers and variability.

The price of aluminum is influenced by a number of factors, including global supply-demand balance, inventory levels, speculative activities by market participants, production activities by producers, geopolitical and economic conditions, as well as production costs in major production regions.

The price of aluminum is influenced by a number of factors, including global supply-demand balance, inventory levels, speculative activities by market participants, production activities by producers, geopolitical and economic conditions, including tariffs, as well as production costs in major production regions.

These factors can be highly variable and difficult to predict, which can lead to significant volatility in the price of aluminum.

Increases or decreases in primary aluminum prices drive variability in our revenues (assuming all other factors are unchanged).

Increases or decreases in primary aluminum prices result in variability in our revenues (assuming all other factors are unchanged).

From time to time, we may seek to manage our exposure to fluctuations in the LME price of primary aluminum and/or associated regional premiums through financial instruments designed to limit our downside price risk.

1 unchanged sentence

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, 2024.

We saw a decline in the pricing of aluminum through the third quarter of 2024.

The following table summarizes the average price for primary aluminum per tonne for the three months ended September 30, 2024 and June 30, 2024 compared to the average price for primary aluminum per tonne for the nine months ended September 30, 2024 and 2023 .

Three months ended Nine months ended

($ per tonne) September 30, 2024 June 30, 2024 September 30, 2024 September 30, 2023

We saw an increase in the pricing of aluminum through the first quarter of 2025.

The significant MWP change was driven by an increase to the Section 232 tariff rate for imported primary aluminum from 10% to 25% effective March 12, 2025.

The following table summarizes the average price for primary aluminum per tonne for the three months ended March 31, 2025 and 2024.

Three months ended

($ per tonne) March 31, 2025 March 31, 2024

Average LME $ 2,631 $ 2,199

2 unchanged sentences

Results of Operations

The following discussion for the three and nine months ended September 30, 2024 reflects no change in production capacities.

The following discussion for the three months ended March 31, 2025 reflects no change in production capacities as compared to the three months ended December 31, 2024.

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.

4 unchanged sentences

Risk Factors — Increases in energy costs may adversely affect our business, financial position, results of operations and liquidity" in our Annual Report on Form 10-K for the year ended December 31, 2024.

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.

Power costs at our Sebree plant is 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 the spring.

1 unchanged sentence

We anticipate the capacity demand power costs resulting from the spring 2025 auction for the twelve months ending May 31, 2026 to be approximately $5.9 million .

In 2024, energy prices in the U.S.

and Europe have moderated from their previously elevated levels.

In 2025, energy prices in the US and Europe have been slightly elevated, primarily driven by cold temperatures and the resulting increase in heating demand.

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

1 unchanged sentence

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.

The pricing under our alumina supply contracts varies from contract to contract.

A major portion of our alumina requirements is indexed to the price of primary aluminum, which provides a natural hedge to one of our largest production costs.

We also purchase alumina based on a published alumina index and at fixed prices.

The alumina price is influenced by a number of factors, including global supply-demand balance, natural disasters and weather events, and other factors outside of our control.

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

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, 2024 June 30, 2024 September 30, 2024 September 30, 2023

March 31, 2025 December 31, 2024 March 31, 2025 March 31, 2024

Related parties $ 378.7 $ 340.8 $ 378.7 $ 315.0

1 unchanged sentence

Total net sales 633.9 630.9 633.9 489.5

Gross profit (loss) 81.8 20.4 118.7 52.5

Net income (loss) 42.3 (6.7) 280.3 (77.9)

Gross profit 60.6 66.3 60.6 16.5

Selling, general and administrative expenses 12.5 14.8 12.5 14.1

Net (loss) gain on forward and derivative contracts - nonaffiliates (5.4) 2.7 (5.4) 3.4

Net (loss) gain on forward and derivative contracts - affiliates — (0.1) — 4.0

Bargain purchase gain — — — 245.9

Income tax expense (1.6) (0.2) (1.6) (0.5)

Net income 25.7 40.4 25.7 244.7

Net loss attributable to noncontrolling interests (4.0) (4.8) (4.0) (2.1)

Net income (loss) attributable to Century stockholders 47.3 (2.5) 291.6 (73.1)

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

Basic $ 0.48 $ (0.03) $ 2.98 $ (0.79)

Diluted 0.46 (0.03) 2.83 (0.79)

Net income attributable to Century stockholders 29.7 45.2 29.7 246.8

SHIPMENTS - PRIMARY ALUMINUM (1)

9 unchanged sentences

97,602 258.1 77,025 189.5 174,627 447.6

93,675 $ 265.8 78,320 $ 207.9 171,995 $ 473.7

97,224 $ 296.4 76,425 $ 212.3 173,649 $ 508.7

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

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

Quarter ended Nine months ended

Sequential Year-to-date

(in millions) September 30, 2024 June 30, 2024 September 30, 2024 September 30, 2023

Net sales $ 539.1 $ 560.8 $ 1,589.4 $ 1,673.1

Net sales decreased by $21.7 million for the three months ended September 30, 2024, compared to the three months ended June 30, 2024, primarily driven by a decrease in third-party alumina sales of $56.5 million partially offset by favorable volume and sales mix of $3.8 million and realized LME and regional price premiums of $31.0 million.

Net sales decreased by $83.7 million for the nine months ended September 30, 2024, compared to the nine months ended September 30, 2023, primarily driven by unfavorable realized LME and regional price premiums of $49.2 million and volume and sales mix of $73.7 million, partially offset by an increase in third-party alumina sales of $37.6 million.

Quarter ended Nine months ended

Sequential Year-to-date

(in millions) September 30, 2024 June 30, 2024 September 30, 2024 September 30, 2023

Gross profit $ 81.8 $ 20.4 $ 118.7 $ 52.5

Gross profit increased by $61.4 million for the three months ended September 30, 2024, compared to the three months ended June 30, 2024, primarily attributable to favorable realized LME and regional price premiums of $31.0 million, and raw material price realization of $2.9 million and $36.6 million attributable to the IRA Section 45X credit, partially offset by lower volume and sales mix of $4.4 million, unfavorable power price realization of $2.9 million, and additional operating expenses of $3.7 million.

Gross profit increased by $66.2 million for the nine months ended September 30, 2024, compared to the nine months ended September 30, 2023, driven by favorable raw material price realization of $71.2 million, power price realization of $21.8 million, and $69.9 million attributable to the IRA Section 45X credit, partially offset by lower volume and sales mix of $23.6 million, unfavorable realized LME and regional price premiums of $49.2 million, and additional operating expenses of $17.0 million.

Selling, general and administrative expenses

Quarter ended Nine months ended

Sequential Year-to-date

(in millions) September 30, 2024 June 30, 2024 September 30, 2024 September 30, 2023

Net sales increased by $3.0 million for the three months ended March 31, 2025, compared to the three months ended December 31, 2024, primarily driven by realized LME and regional price premiums of $35.6 million and favorable volume and sales mix of $11.3 million, partially offset by a decrease in third-party alumina sales of $44.5 million.

Net sales increased by $144.4 million for the three months ended March 31, 2025, compared to the three months ended March 31, 2024, primarily driven by favorable realized LME and regional price premiums of $91.1 million and an increase in third-party alumina sales of $58.0 million, partially offset by unfavorable volume and sales mix of $4.7 million.

Gross profit decreased by $5.7 million for the three months ended March 31, 2025, compared to the three months ended December 31, 2024, primarily attributable to unfavorable raw material price realization of $25.7 million, unfavorable power price realization of $22.2 million, partially offset by favorable realized LME and regional price premiums of $35.6 million.

Gross profit increased by $44.1 million for the three months ended March 31, 2025, compared to the three months ended March 31, 2024, primarily due to favorable metal price realization of $63.5 million, favorable regional price realization of $27.6

million, partially offset by higher power price realization of $26.7 million and higher operating expenses of $20.3 million including labor costs associated with higher headcounts, increased maintenance costs, and ramp up expenses for the completed Grundartangi casthouse.

Selling, general and administrative expenses

Selling, general and administrative expenses increased by $3.3 million for the three months ended September 30, 2024, compared to the three months ended June 30, 2024, primarily driven by increased professional services and share-based compensation costs during the period.

Selling, general and administrative expenses increased by $5.8 million for the nine months ended September 30, 2024, compared to the nine months ended September 30, 2023, primarily driven by an increase in professional services and share-based compensation costs resulting from the increase of the Company's stock price between periods .

Net gain (loss) on forward and derivative contracts

Quarter ended Nine months ended

Sequential Year-to-date

(in millions) September 30, 2024 June 30, 2024 September 30, 2024 September 30, 2023

Net gain (loss) on forward and derivative contracts $ (4.0) $ (4.0) $ (0.6) $ (73.7)

Net loss on forward and derivative contracts was $4.0 million for the three months ended September 30, 2024, which was flat as compared to the three months ended June 30, 2024.

Net loss on forward and derivative contracts was $0.6 million for the nine months ended September 30, 2024, a difference of $73.1 million as compared to the nine months ended September 30, 2023.

The difference was primarily driven by reduced losses on Nord Pool derivative contracts which were settled in December 2023.

Bargain purchase gain

Quarter ended Nine months ended

Sequential Year-to-date

(in millions) September 30, 2024 June 30, 2024 September 30, 2024 September 30, 2023

Selling, general and administrative expenses decreased by $2.3 million for the three months ended March 31, 2025, compared to the three months ended December 31, 2024, primarily driven by decreased share-based compensation costs, partially offset by annual incentive compensation during the period.

Selling, general and administrative expenses decreased by $1.6 million for the three months ended March 31, 2025, compared to the three months ended March 31, 2024, primarily driven by a decrease in share-based compensation costs.

Net gain (loss) on forward and derivative contracts - nonaffiliates

Net gain (loss) on forward and derivative contracts - nonaffiliates decreased by $8.1 million for the three months ended March 31, 2025, compared to the three months ended December 31, 2024.

The difference was primarily driven by fluctuations in the forward prices and volume of contracts settled.

Net gain (loss) on forward and derivative contracts - nonaffiliates decreased by $8.8 million for the three months ended March 31, 2025, as compared to the three months ended March 31, 2024.

The difference was primarily driven by fluctuations in the forward prices and volume of contracts settled.

Net gain (loss) on forward and derivative contracts - affiliates

Net gain on forward and derivative contracts - affiliates was zero for the three months ended March 31, 2025, as there were no affiliated party contracts executed during the quarter, as compared to a net loss of $0.1 million for the three months ended December 31, 2024.

We realized a net gain of $4.0 million for the three months ended March 31, 2024, primarily driven by unrealized gains on LME hedges.

Bargain purchase gain

We finalized the purchase accounting as of March 31, 2024 related to the acquisition of General Alumina Holdings Limited and subsidiaries, which was acquired on May 2, 2023, and recognized no bargain purchase gain for the three months ended September 30, 2024 and recognized $245.9 million for the nine months ended September 30, 2024.

Income tax (expense) benefit

Quarter ended Nine months ended

Sequential Year-to-date

(in millions) September 30, 2024 June 30, 2024 September 30, 2024 September 30, 2023

Income tax (expense) benefit $ (2.0) $ (0.5) $ (3.0) $ 21.2

Income tax expense increased for the three months ended September 30, 2024, compared to $0.5 million for the three months ended June 30, 2024, primarily driven by changes in the jurisdictional mix of earnings on a quarter-over-quarter basis.

Income tax benefit changed to an expense of $3.0 million for the nine months ended September 30, 2024, compared to a benefit of $21.2 million for the nine months ended September 30, 2023, primarily driven by changes in the jurisdictional mix of earnings on a year-over-year basis.

We finalized the purchase accounting as of March 31, 2024 related to the acquisition of General Alumina Holdings Limited and subsidiaries, which was acquired on May 2, 2023.

We recognized a bargain purchase gain of $245.9 million for the three months ended March 31, 2024.

Income tax expense

Income tax expense increased to $1.6 million for the three months ended March 31, 2025, compared to $0.2 million for the three months ended December 31, 2024, primarily driven by changes in the jurisdictional mix of earnings on a quarter-over-quarter basis.

Income tax expense increased to $1.6 million for the three months ended March 31, 2025, compared $0.5 million for the three months ended March 31, 2024, 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.

3 unchanged sentences

and Iceland revolving credit facilities (collectively, the "revolving credit facilities") and have raised capital in the past through public equity and debt markets.

We regularly explore various other financing alternatives.

Our principal uses of cash include the funding of operating costs (including post-retirement benefits), debt service requirements, capital expenditures, investments in our growth activities and in related businesses, working capital and other general corporate requirements.

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, 2024, we had cash and cash equivalents of approximately $32.6 million and unused availability under our revolving credit facilities of $246.3 million (including $80 million under the Vlissingen Credit Facility referred to below, which expires in December 2026).

Our cash and cash equivalents and unused availability under our revolving credit facilities comprise our liquidity position, which was $278.9 million as of September 30, 2024.

As of March 31, 2025, we had cash and cash equivalents of approximately $44.9 million and unused availability under our revolving credit facilities of $294.2 million, after consideration of our outstanding

borrowings and letters of credit.

Our cash and cash equivalents and unused availability under our revolving credit facilities comprise our liquidity position, which was $339.1 million as of March 31, 2025.

We may borrow and make repayments under our revolving 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.

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.

Increases in the price of aluminum and/or restarts of previously curtailed operations, for example, increase our borrowing base by increasing our accounts receivable and inventory balances;

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.

Our credit facilities contain customary covenants, including restrictions on mergers and acquisitions, indebtedness, affiliate transactions, liens, dividends and distributions, dispositions of collateral, investments and prepayments of indebtedness, including in the U.S.

revolving credit facility, a springing financial covenant that requires us to maintain a fixed charge coverage ratio of at least 1.0 to 1.0 any time availability under the U.S.

revolving credit facility is less than or equal to $25.0 million, or 10% of the borrowing base but not less than $17.9 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.

Our Iceland revolving credit facility contains covenants that require Grundartangi to maintain a minimum equity ratio.

The dividend and distribution limitations are applicable to certain of our subsidiaries only in the case of an event of default or failure to comply with certain financial covenants.

As of March 31, 2025, we and our subsidiaries were in compliance with all such covenants or maintained availability above such covenant triggers.

Debt to the consolidated financial statements included herein for additional information on our debt.

Available Cash

Our available cash and cash equivalents balance at September 30, 2024 was $32.6 million compared to $88.8 million at December 31, 2023.

Our available cash and cash equivalents balance at March 31, 2025 was $44.9 million compared to $32.9 million at December 31, 2024.

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) 2025 2024

Net cash provided by operating activities $ 16.8 $ 39.6

Net cash provided by (used in) operating activities $ 72.3 $ (14.8)

Net cash used in investing activities (15.5) (29.7)

Net cash (used) provided by financing activities (4.9) 17.2

Net cash (used in) provided by financing activities (44.8) 49.2

Change in cash, cash equivalents and restricted cash $ 12.0 $ 4.7

The decrease in net cash provided by operating activities during the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023 was primarily driven by timing of payments and receipts.

The increase in net cash used in investing activities during the nine months ended September 30, 2024 compared to the nine months ended September 30, 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 port repair.

Additionally, in the nine months ended September 30, 2023, the Company received cash inflows of $19.4 million from the acquisition of subsidiary, net of cash acquired.

The change in net cash provided by financing activities during the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023 was primarily due to reduction in net borrowings on our revolving credit facilities and Grundartangi Casthouse Facility as well as the repayment of carbon credits.

Availability Under Our Credit Facilities

revolving credit facility, dated May 2018 (as amended, the "U.S.

revolving credit facility"), previously provided for borrowings of up to $220.0 million, including up to $110.0 million under a letter of credit sub-facility.

In June 2022, we entered into a Fourth Amendment to our existing $220.0 million U.S.

revolving credit facility, increasing the maximum capacity from $220.0 million to $250.0 million, including up to $150.0 million under a letter of credit sub-facility.

revolving credit facility matures in June 2027.

Any letters of credit issued and outstanding under the U.S.

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

We have also entered into, through our wholly-owned subsidiary, Nordural Grundartangi ehf ("Grundartangi"), a $50.0 million revolving credit facility, dated November 2013, as amended (the "Iceland revolving credit facility").

On February 4, 2022, we amended the Iceland revolving credit facility and increased the facility amount to $80.0 million in the aggregate.

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 December 2026.

Increases in the price of aluminum and/or restarts of previously curtailed operations, for example, increase our borrowing base by increasing our accounts receivable and inventory balances;

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, 2024, our U.S.

revolving credit facility had a borrowing availability of $149.9 million , outstanding borrowings of $9.6 million , and $74.0 million of outstanding letters of credit with total availability of $66.3 million .

Of the outstanding letters of credit, $13.7 million are related to our power commitments, $33.2 million are related to raw materials and the remaining $27.1 million are primarily for the purpose of securing certain debt and workers’ compensation commitments.

As of September 30, 2024, 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, 2024, our credit facilities had $246.3 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.

revolving credit facility, a springing financial covenant that requires us to maintain a fixed charge coverage ratio of at least 1.0 to 1.0 as of any date of determination on which availability under the U.S.

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.

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

As of September 30, 2024, we were in compliance with all such covenants or maintained availability above such covenant triggers.

Grundartangi Casthouse Facility

On November 2, 2021, Grundartangi entered into an eight-year Term Facility Agreement with Arion Bank hf, to provide for borrowings up to $130 million in connection with the casthouse project at Grundartangi (the "Casthouse Facility").

Under the Casthouse Facility, repayments of principal amounts will be made in equal quarterly installments equal to 1.739% of the principal amount, the first payment occurring in July 2024, with the remaining 60% of the principal amount to be paid no later than the termination date.

The Casthouse Facility will mature in December 2029.

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

As of September 30, 2024 there were $125.5 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, 2024, we were in compliance with all such covenants.

Senior Notes and Convertible Senior Notes

In April 2021, we issued $250.0 million principal of senior secured notes that will mature on April 1, 2028 (the "2028 Notes"), unless earlier refinanced in accordance with their terms.

Interest on the 2028 Notes is payable semi-annually on April 1 and October 1 of each year, at a rate of 7.5% per year.

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.

In April 2021, we issued $86.3 million in aggregate principal amount of Convertible Notes (the "Convertible Notes"), that will mature on May 1, 2028, unless earlier converted, repurchased or redeemed.

The principal included the full exercise of the option by the initial purchasers of the Convertible Notes to purchase $11.3 million of additional principal amount.

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

Iceland Term Facility

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 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 Credit Facility

On December 9, 2022, Vlissingen entered into a $90.0 million Facility Agreement with Glencore International AG, which was amended and extended on October 1, 2024.

The availability period for borrowings under the Vlissingen Credit Facility was extended by two years and now ends on December 2, 2026.

Pursuant to the terms of the Vlissingen Credit Facility, Vlissingen may borrow from time to time up to $90.0 million in one or more loans at a fixed interest rate equal to 8.75% per annum (the "Fixed Rate"), or (ii) a variable interest rate equal to the 1-month SOFR rate plus 3.687 percentage points, subject to an absolute maximum level of 9.00% and an absolute minimum level of 7.00%.

The Fixed Rate is only applicable to borrowings made on or before December 1, 2024, after which the Variable Rate shall apply to all borrowings under the Vlissingen Credit Facility.

As of September 30, 2024, there were $10.0 million in outstanding borrowings under the Vlissingen Credit Facility.

The obligations under the Vlissingen Credit Facility are secured by liens on the ground lease on which Vlissingen's facilities are located, Vlissingen's moveable assets, financial assets, receivables and other assets, and Vlissingen’s shares.

The Vlissingen Credit Facility contains customary covenants, including with respect to mergers, guarantees and preservation and dispositions of assets.

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

The increase in net cash provided by operating activities during the three months ended March 31, 2025 compared to the three months ended March 31, 2024 was primarily due to lower cash outflows from accounts payable associated with the timing of payments for alumina, partially offset by lower cash inflows from accounts receivable from sales of aluminum and alumina.

The decrease in net cash used in investing activities during the three months ended March 31, 2025 compared to the three months ended March 31, 2024 was primarily due to higher prior year expenditures related to the Grundartangi casthouse project completed in the second quarter of 2024.

The change in net cash used in financing activities during the three months ended March 31, 2025 compared to net cash provided by financing activities in the three months ended March 31, 2024 was primarily due to net repayments on our revolving credit facilities and repayments on our Grundartangi Casthouse Facility.

Supplemental Guarantor Financial Information

The Company has filed a Registration Statement on Form S-3 (the "Universal Shelf Registration Statement") with the SEC pursuant to which the Company may, from time to time, offer an indeterminate amount of securities, which may include securities that are guaranteed by certain of the Company's subsidiaries.

As of September 30, 2024, we have not issued any debt securities pursuant to the Universal Shelf Registration Statement.

As of March 31, 2025, 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.

2 unchanged sentences

The Guarantor Subsidiaries are 100% owned by Century.

All guarantees will be joint and several, full and unconditional.

All guarantees will be full and unconditional;

all guarantees will be joint and several.

Our foreign subsidiaries, together with Nordural US LLC, Century Aluminum Development LLC, Century Aluminum of West Virginia, Inc.

2 unchanged sentences

The following summarized financial information of both the Company and the Guarantor Subsidiaries ("Guarantors") is presented on a combined basis.

Intercompany balances and transactions between the Company and the Guarantors have been eliminated and the summarized financial information does not reflect investments of the Company or the Guarantors in the Non-Guarantor Subsidiaries ("Non-Guarantors").

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

September 30, 2024 December 31, 2023

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

March 31, 2025 December 31, 2024

Current assets $ 430.0 $ 414.0

2 unchanged sentences

Non-current liabilities 503.4 490.4

Nine months Ended September 30, 2024

Three months ended March 31, 2025

Net sales $ 538.4

2 unchanged sentences

Net income 29.7

As of September 30, 2024 and December 31, 2023, an intercompany receivable due to the Company and Guarantors from the Non-Guarantors totaled $98.0 million and $48.7 million, respectively, and an intercompany non-current loan due to the Company from the Non-Guarantors totaled $351.0 million and $384.9 million, respectively.

An intercompany current loan due to the Company from the Non-Guarantors totaled $2.9 million as of December 31, 2023, and as of September 30, 2024 there was no outstanding balance on this loan.

Contingent Commitments

We have a contingent obligation in connection with the "unwind" of a contractual arrangement between Century Aluminum of Kentucky ("CAKY"), Big Rivers Electric Corporation and a third party and the execution in July 2009 of a long-term cost-based power contract with Kenergy, a member of a cooperative of Big Rivers.

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, 2024, the principal and accrued interest for the contingent obligation was $32.0 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, 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.

Employee Benefit Plan Contributions

In 2013, we entered into a settlement agreement with the Pension Benefit Guaranty Corporation (the "PBGC") regarding an alleged "cessation of operations" at our Ravenswood facility (the "PBGC Settlement Agreement").

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.

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, 2024, we made contributions of $7.2 million rela ted to the Amended PBGC Settlement Agreement.

We did not make any contributions for the three months ended September 30, 2024 and 2024.

Section 232 Aluminum Tariff

On March 23, 2018, the U.S.

implemented a 10% tariff on imported primary aluminum products into the U.S.

These tariffs are intended to protect U.S.

national security and incentivize the restart of primary aluminum production in the U.S., reducing reliance on imports and ensuring that domestic producers, like Century, can supply all the aluminum necessary for critical industries and national defense.

In addition to primary aluminum products, the tariffs also cover certain other semi-finished products.

All imports that directly compete with our products are covered by the tariff, with the exception of imports from Australia, Canada and Mexico.

Additionally, primary aluminum imports from Argentina are allowed up to an annual quota limit of 169,000 metric tonnes, the first 18,000 metric tonnes of imports from the European Union and the first 900 metric tonnes of imports from the United Kingdom are also allowed duty free.

Imports that receive a product exclusion from the Department of Commerce may also enter the US duty free.

In July 2022, the International Trade Commission (ITC) initiated a review of the Section 301 and 232 duties as required by law every four years.

On March 15, 2023, the ITC submitted a report to the United States Congress entitled, 'Economic Impact of Section 232 and 301 Tariffs on U.S.

Industries,' in which the ITC found that the tariffs increased the production of domestic aluminum while causing prices to increase by less than two percent.

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

Section 301 Tariffs

On May 22, 2024, the United States Trade Representative (USTR) issued a proposal (the “Proposal”) to implement new

tariffs on certain items and increase existing tariffs on other items imported from China pursuant to USTR’s authority under

Section 301 of the Trade Act of 1974.

The new and increased tariffs were adopted pursuant to the USTR’s authority to

investigate unfair trade barriers and impose measures to counteract a foreign country’s unfair or discriminatory trade practices.

Under the Proposal, tariffs on aluminum imported from China are expected to increase to 25% from the current 7.5% tariff

imposed in 2018.

The increased tariff is in addition to the 10% tariff imposed under Section 232 of the Trade Expansion Act.

The new and increased Section 301 tariffs are only applicable to imports with China as the country of origin.

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 October 24, 2024, the U.S.

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

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

For the three and nine months ended September 30, 2024, we recognized $47.3 million and $69.9 million as a reduction in Cost of goods sold and $0.8 million and $2.0 million, respectively, as a reduction in Selling, general and administrative expenses within the Consolidated Statements of Operations, resulting in an equally offsetting receivable.

As of September 30, 2024 and December 31, 2023, we recognized a Manufacturing credit receivable of $78.8 million and $59.3 million, respectively, and as of September 30, 2024, we recognized a Non-current Manufacturing credit receivable of $52.4 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 was completed during the second quarter of 2024.

The Grundartangi casthouse project was funded primarily through the Casthouse Facility.

The project is complete and billets have started to ship from the casthouse in the second half of 2024.

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.

As of March 31, 2025 and December 31, 2024, an intercompany receivable due to the Company and Guarantors from the Non-Guarantor Subsidiaries totaled $46.3 million and $40.4 million, respectively, and an intercompany non-current loan due to the Company from the Non-Guarantor Subsidiaries totaled $365.2 million and $358.1 million, respectively.

Share Repurchase Program

In 2011, our Board of Directors approved a $60.0 million common stock repurchase program and subsequently increased this program by $70.0 million in the first quarter of 2015.

Under the program, Century is authorized to repurchase up to $130.0 million of our outstanding shares of common stock, from time to time, on the open market at prevailing market prices, in block trades or otherwise.

The timing and amount of any shares repurchased will be determined by our management based on its evaluation of market conditions, the trading price of our common stock and other factors.

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

As of September 30, 2024, we had $43.7 million remaining under the repurchase program authorization.

We made no repurchases during the three months ended March 31, 2025 or during the years ended 2024, 2023, and 2022.

As of March 31, 2025, 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.

In November 2009, Century Aluminum of West Virginia, Inc.

("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.

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, 2024, we had $2.0 million in other current liabilities and $1.5 million in other liabilities related to this agreement.

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

While it is impossible to predict the ultimate disposition of any litigation, we do not believe that any of these lawsuits, either individually or in the aggregate, will have a material adverse effect on our financial condition, results of operations or liquidity.

Commitments and Contingencies to the consolidated financial statements included herein for additional information.

Capital Resources

Capital Resources and Commitments

We intend to finance our future capital expenditures from available cash, cash flows from operations and if necessary, borrowing under our existing revolving credit facilities.

3 unchanged sentences

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, 2024 were $35.3 million, including expenditures related to the Jamalco port repair, but excludes expenditures of $33.8 million associated with the Grundartangi casthouse project.

We estimate our total remaining capital spending in 2024 will be approximately $10 to $15 million, related to our ongoing investment and sustainability projects at our aluminum smelters and alumina refinery.

On January 10, 2025, the Company entered into a Cooperative Agreement with the DOE’s Office of Clean Energy Demonstrations for up to $500 million in IRA funding.

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

primary aluminum smelter in 50 years at a site within the Ohio/Mississippi River Basins.

Capital expenditures paid for the three months ended March 31, 2025 were $21.2 million.

We estimate our total capital spending in 2025 will be approximately $70 to $80 million, related to our ongoing investment and sustainability projects at our plants.

This amount includes $40 million, representing investments in our Jamalco facility.

We have certain legal commitments, including obligations related to retiree medical benefits, pension contributions, power supply contracts, and labor agreements.

These include a settlement agreement for retiree medical benefits requiring annual payments, a pension contribution commitment through 2025, and power supply arrangements with terms extending through 2028.

Additionally, we have contingent obligations based on the LME price of primary aluminum and the level of Hawesville's operations, which are currently offset by a derivative asset.

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

Commitments and Contingencies to the consolidated financial statements included herein for additional information.

Quantitative and Qualitative Disclosures about Market Risk

See "Quantitative and Qualitative Disclosures of Market Risks" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

As of March 31, 2025, there have been no material changes in this information.

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