Item 1. Financial Statements
Item 1. Financial Statements
CENTURY ALUMINUM COMPANY
CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions, except per share amounts)
(Unaudited)
Three months ended
March 31,
2025 2024
Net sales
Related parties $ 378.7 $ 315.0
Other customers 255.2 174.5
Total net sales 633.9 489.5
Cost of goods sold (1)
573.3 473.0
Gross profit 60.6 16.5
Selling, general and administrative expenses 12.5 14.1
Other operating expense - net 2.0 0.5
Operating income 46.1 1.9
Interest expenses - nonaffiliates ( 10.0 ) ( 7.4 )
Interest expense - affiliates ( 1.8 ) ( 1.8 )
Interest income 1.8 0.7
Net (loss) gain on forward and derivative contracts - nonaffiliates ( 5.4 ) 3.4
Net gain on forward and derivative contracts - affiliates — 4.0
Bargain purchase gain — 245.9
Other income (loss) - net ( 3.4 ) ( 1.5 )
Income before income taxes 27.3 245.2
Income tax expense ( 1.6 ) ( 0.5 )
Net income 25.7 244.7
Net loss attributable to noncontrolling interests ( 4.0 ) ( 2.1 )
Net income attributable to Century stockholders 29.7 246.8
Less: net income allocated to participating securities 1.5 13.2
Net income allocated to common stockholders $ 28.2 $ 233.6
(1) Purchases from related party were $ 88.3 million and $ 59.0 million for the quarters ended March 31, 2025 and 2024, respectively.
NET INCOME ATTRIBUTABLE TO CENTURY STOCKHOLDERS PER COMMON SHARE:
Basic $ 0.30 $ 2.52
Diluted 0.29 2.26
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
Basic 93.3 92.7
Diluted 99.2 98.7
See Condensed Notes to the Consolidated Financial Statements
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CENTURY ALUMINUM COMPANY
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(in millions)
(Unaudited)
Three months ended
March 31,
2025 2024
Comprehensive income:
Net income $ 25.7 $ 244.7
Other comprehensive income (loss) before income tax effect:
Net loss on foreign currency cash flow hedges reclassified as income — ( 0.1 )
Defined benefit plans and other postretirement benefits:
Net loss arising during the period — ( 3.4 )
Amortization of prior service cost during the period 0.1 0.1
Amortization of net loss during the period 1.6 1.7
Other comprehensive income (loss) before income tax effect 1.7 ( 1.7 )
Income tax effect — —
Other comprehensive income (loss) 1.7 ( 1.7 )
Comprehensive income 27.4 243.0
Comprehensive loss attributable to noncontrolling interests ( 4.0 ) ( 2.1 )
Comprehensive income attributable to Century stockholders $ 31.4 $ 245.1
See Condensed Notes to the Consolidated Financial Statements
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CENTURY ALUMINUM COMPANY
CONSOLIDATED BALANCE SHEETS
(in millions)
(Unaudited)
March 31, 2025 December 31, 2024
ASSETS
Cash and cash equivalents $ 44.9 $ 32.9
Restricted cash 2.8 2.8
Accounts receivable - net 108.9 75.8
Non-trade receivables — 13.2
Due from affiliates 8.4 25.1
Manufacturing credit receivable 81.5 81.5
Inventories 542.2 539.0
Derivative assets 7.6 4.2
Prepaid and other current assets 25.6 28.3
Total current assets 821.9 802.8
Property, plant and equipment - net 972.2 978.3
Manufacturing credit receivable - less current portion 91.1 70.4
Other assets 69.3 87.9
Total assets $ 1,954.5 $ 1,939.4
LIABILITIES AND SHAREHOLDERS’ EQUITY
LIABILITIES:
Accounts payable, trade $ 201.7 $ 187.3
Non-trade payable 7.4 —
Accrued compensation and benefits 40.6 49.8
Due to affiliates 122.6 109.3
Accrued and other current liabilities 36.6 42.0
Derivative liabilities 10.2 4.4
Current maturities of long-term debt 28.3 70.9
Total current liabilities 447.4 463.7
Long-term debt 444.3 447.3
Long-term debt due to affiliates 10.0 10.0
Accrued benefits costs - less current portion 129.3 130.4
Other liabilities 95.7 92.6
Deferred taxes 72.7 71.2
Asset retirement obligations - less current portion 64.4 61.5
Total noncurrent liabilities 816.4 813.0
COMMITMENTS AND CONTINGENCIES (NOTE 12)
SHAREHOLDERS’ EQUITY:
Preferred stock (Note 13 )
— —
Common stock (Note 13 )
1.0 1.0
Additional paid-in capital 2,550.8 2,550.2
Treasury stock, at cost ( 86.3 ) ( 86.3 )
Accumulated other comprehensive loss ( 101.6 ) ( 103.3 )
Accumulated deficit ( 1,637.6 ) ( 1,667.2 )
Total Century shareholders’ equity 726.3 694.4
Noncontrolling interests ( 35.6 ) ( 31.7 )
Total equity 690.7 662.7
Total liabilities and equity $ 1,954.5 $ 1,939.4
See Condensed Notes to the Consolidated Financial Statements
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CENTURY ALUMINUM COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions)
(Unaudited)
Three months ended March 31,
2025 2024
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 25.7 $ 244.7
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Unrealized loss (gain) on derivative instruments 3.0 ( 6.4 )
Depreciation, depletion and amortization 20.7 19.9
Change in deferred tax provision 1.2 0.4
Bargain purchase gain — ( 245.9 )
Other non-cash items - net — ( 1.5 )
Change in operating assets and liabilities:
Accounts receivable - net ( 12.5 ) ( 1.4 )
Non-trade receivables 15.4 5.2
Manufacturing credit receivable ( 20.7 ) ( 12.6 )
Due from affiliates 16.7 ( 2.6 )
Inventories ( 0.1 ) ( 7.2 )
Prepaid and other current assets 4.0 0.2
Accounts payable, trade 20.8 ( 33.8 )
Due to affiliates 12.2 33.6
Accrued and other current liabilities ( 13.9 ) ( 8.4 )
Other - net ( 0.2 ) 1.0
Net cash provided by (used in) operating activities 72.3 ( 14.8 )
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property, plant and equipment ( 21.2 ) ( 29.7 )
Proceeds from co-tenancy assets at Jamalco JV 5.7 —
Net cash used in investing activities ( 15.5 ) ( 29.7 )
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings under revolving credit facilities 257.6 155.9
Repayments under revolving credit facilities ( 300.1 ) ( 130.5 )
Repayments under Iceland term facility — ( 1.2 )
Borrowings under Grundartangi casthouse debt facility — 25.0
Repayments under Grundartangi casthouse debt facility ( 2.3 ) —
Net cash (used in) provided by financing activities ( 44.8 ) 49.2
CHANGE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH 12.0 4.7
Cash, cash equivalents and restricted cash, beginning of period 35.7 90.3
Cash, cash equivalents and restricted cash, end of period $ 47.7 $ 95.0
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CENTURY ALUMINUM COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions)
(Unaudited)
Three months ended March 31,
2025 2024
Supplemental Cash Flow Information:
Cash paid for:
Interest $ 4.9 $ 2.9
Taxes, net of refunds 2.3 1.1
Non-cash investing activities:
Capital expenditures 4.1 6.7
Capitalized interest — 2.4
Distribution of property, plant and equipment to NCI 0.6 —
See Condensed Notes to the Consolidated Financial Statements
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CENTURY ALUMINUM COMPANY
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
(in millions, except share data)
(Unaudited)
Preferred stock Common stock Additional paid-in capital Treasury stock, at cost Accumulated other comprehensive loss Accumulated
deficit Total Century equity Noncontrolling Interest Total equity
Shares Amount Shares Amount
Three months ended
March 31, 2025
Balance, December 31, 2024 49,715 $ — 93,288,565 $ 1.0 $ 2,550.2 $ ( 86.3 ) $ ( 103.3 ) $ ( 1,667.3 ) $ 694.3 $ ( 31.6 ) $ 662.7
Net income (loss) — — — — — — — 29.7 29.7 ( 4.0 ) 25.7
Other comprehensive income — — — — — — 1.7 — 1.7 — 1.7
Share-based compensation — — 4,779 — 0.6 — — — 0.6 — 0.6
Conversion of preferred stock to common stock ( 36 ) — 3,593 — — — — — — — —
Balance, March 31, 2025 49,679 $ — 93,296,937 $ 1.0 $ 2,550.8 $ ( 86.3 ) $ ( 101.6 ) $ ( 1,637.6 ) $ 726.3 $ ( 35.6 ) $ 690.7
Three months ended
March 31, 2024
Balance, December 31, 2023 52,284 — 92,689,864 $ 1.0 $ 2,542.9 $ ( 86.3 ) $ ( 97.9 ) $ ( 2,004.1 ) $ 355.6 $ ( 11.5 ) $ 344.1
Net income (loss) — — — — — — — 246.8 246.8 ( 2.1 ) 244.7
Other comprehensive loss — — — — — — ( 1.7 ) — ( 1.7 ) — ( 1.7 )
Share-based compensation — — 6,069 — 0.8 — — — 0.8 — 0.8
Conversion of preferred stock to common stock ( 46 ) — 4,562 — — — — — — — —
Noncontrolling interest — $ — — — — — — — — ( 0.8 ) ( 0.8 )
Balance, March 31, 2024 52,238 — 92,700,495 $ 1.0 $ 2,543.7 $ ( 86.3 ) $ ( 99.6 ) $ ( 1,757.3 ) $ 601.5 $ ( 14.4 ) $ 587.1
See Condensed Notes to the Consolidated Financial Statements
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CENTURY ALUMINUM COMPANY
Condensed Notes to the Consolidated Financial Statements
Three months ended March 31, 2025 and 2024
(amounts in millions, except share and per share amounts)
(Unaudited)
1. General
Description of Business
Century Aluminum is a producer of primary aluminum, which trades as a global commodity, and owns a 55 % interest in an alumina refinery joint venture. We are organized as a holding company, with our operating primary aluminum smelters and our bauxite and alumina refinery owned by separate subsidiaries.
Throughout this Form 10-Q, and unless expressly stated otherwise or as the context otherwise requires, "Century Aluminum", "Century", "the Company", "we", "us", "our" and "ours" refer to Century Aluminum Company and its consolidated subsidiaries.
Basis of Presentation
The accompanying unaudited interim consolidated financial statements of Century Aluminum Company should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2024. In management’s opinion, the unaudited interim consolidated financial statements reflect all adjustments, which are of a normal and recurring nature, that are necessary for a fair presentation of financial results for the interim periods presented. Operating results for the first three months of 2025 are not necessarily indicative of the results that may be expected for the year ending December 31, 2025.
Our consolidated financial statements include the consolidated results of the Jamalco joint venture ("Jamalco"), an unincorporated joint venture between Clarendon Alumina Production Limited ("CAP") and General Alumina Jamaica Limited ("GAJL"), an indirect, wholly-owned subsidiary of the Company through General Alumina Holdings Limited ("GAHL"). CAP's interest in the joint venture is reflected as noncontrolling interest on the accompanying Consolidated Balance Sheets. The acquisition of all the outstanding capital of GAHL was accounted for as a business combination under the acquisition method of accounting in accordance with ASC 805 - Business Combinations, resulting in the Company recognizing the assets and liabilities at fair value with the excess of fair value over the consideration paid to the seller presented as a bargain purchase gain of $ 245.9 million recognized within the Consolidated Statements of Operations for the three months ended March 31, 2024.
Recent Accounting Pronouncements
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, that requires presentation of specific categories of reconciling items, as well as reconciling items that meet a quantitative threshold, in the reconciliation between the income tax provision and the income tax provision using statutory tax rates. The standard also requires disclosure of income taxes paid disaggregated by jurisdiction with separate disclosure of income taxes paid to individual jurisdictions that meet a quantitative threshold. The amendments in this accounting standard are effective for fiscal years beginning after December 15, 2024, on a prospective basis. Early adoption and retrospective application are permitted. We do not expect the adoption of this accounting standard to have an impact on our consolidated financial statements, but will require certain additional disclosures. The Company plans to adopt this guidance on its consolidated financial statements and related disclosures for the annual period ending December 31, 2025.
In November 2024, the FASB issued ASU 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, that requires disclosure of the amounts of purchases of inventory, employee compensation, depreciation, and intangible asset amortization included in each relevant expense line item on the income statement. The standard also requires a qualitative description of other amounts included in each relevant expense line item on the income statement that are not separately disclosed. In addition, entities are required to disclose the nature and amount of selling expenses. The new standard is effective for fiscal years beginning after December 15, 2026, and interim periods beginning after December 15, 2027. Early adoption is permitted. We do not expect any impact to the consolidated financial statements, but the standard will require certain additional disclosures in the notes to the
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CENTURY ALUMINUM COMPANY
Condensed Notes to the Consolidated Financial Statements (continued)
(amounts in millions, except share and per share amounts)
(Unaudited)
consolidated financial statements and the Company plans to adopt this guidance for the annual period ending December 31, 2027.
2. Related Party Transactions
The significant related party transactions occurring during the three months ended March 31, 2025 and 2024 are described below. All of our related party transactions are subject to the Company's Related Party Transaction Policy and are required to be made on an arm's length basis and on terms that are fair and reasonable to the Company and substantially the same as would apply if the other party was not a related party. We believe all of our transactions with related parties are at prices that approximate market.
Glencore Ownership
As of March 31, 2025 , Glencore plc and its affiliates (together "Glencore") beneficially owned 42.9 % of Century’s outstanding common stock ( 45.8 % on a fully-diluted basis assuming the conversion of all of the Series A Convertible Preferred Stock) and all of our outstanding Series A Convertible Preferred Stock. See Note 13 . Shareholders' Equity for a description of our outstanding Series A Convertible Preferred Stock. Century and Glencore enter into various transactions from time to time, such as the purchase and sale of primary aluminum, alumina and other raw materials; tolling agreements; forward financial contracts and borrowing and other debt transactions.
Sales to Glencore
For the three months ended March 31, 2025 and 2024, we derived approximately 59.7 % and 64.3 % of our consolidated net sales from Glencore, respectively.
Glencore purchases aluminum produced at our U.S. smelters at prices based on the LME plus the Midwest regional delivery premium plus any additional market-based product premiums. Glencore purchases aluminum produced at our Grundartangi, Iceland smelter at prices primarily based on the LME plus the European Duty Paid premium plus any additional market-based product premiums.
We have entered into agreements with Glencore pursuant to which we sell certain amounts of alumina at market-based prices. For the three months ended March 31, 2025 and 2024, the Company recognized $ 78.4 million and $ 35.5 million, respectively, of revenue related to alumina sales to Glencore.
Purchases from Glencore
We purchase a portion of our alumina and certain other raw material requirements from Glencore. Alumina purchases from Glencore during the three months ended March 31, 2025 and 2024, were priced based on published alumina and aluminum indices as well as fixed prices.
Financial Contracts with Glencore
From time to time, we enter into certain financial contracts with Glencore. See Note 1 0 . Derivatives regarding these forward financial sales contracts.
Summary
A summary of the aforementioned significant related party sales and purchases is as follows:
Three months ended
March 31,
2025 2024
Net sales to Glencore $ 378.7 $ 315.0
Purchases from Glencore (1)
88.3 59.0
(1) Includes settlements of financial contract positions.
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CENTURY ALUMINUM COMPANY
Condensed Notes to the Consolidated Financial Statements (continued)
(amounts in millions, except share and per share amounts)
(Unaudited)
Vlissingen Credit Facility
On December 9, 2022, Vlissingen entered into a Facility Agreement with Glencore International AG, which was amended and extended on October 1, 2024 (as amended, the “Vlissingen Credit Facility”). The availability period for borrowings under the Vlissingen Credit Facility was extended by two years and now ends on December 2, 2026. Under the Vlissingen Credit Facility Vlissingen may borrow from time to time up to $ 90.0 million in one or more loans at either (i) 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 “Variable Rate”). 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. See Note 11. Debt for additional information. Borrowings under the Vlissingen Credit Facility are expected to be used for general corporate and working capital purposes of Century and its subsidiaries.
Carbon Credit Repurchase Agreement
In September 2023, our wholly owned subsidiary Nordural Grundartangi ehf ("Grundartangi"), entered into a structured repurchase arrangement with Glencore and sold 390,000 European Union Allowances ("Carbon Credits") at a price of € 82.18 per Carbon Credit, for an aggregate amount of € 32.1 million (the "Original Carbon Credit Agreement") . Pursuant to the terms of the Original Carbon Credit Agreement, Grundartangi would repurchase the same number of Carbon Credits at a price of € 83.72 per Carbon Credit, for an aggregate amount of € 32.7 million. The Original Carbon Credit Agreement was amended in December 2023, March 2024, August 2024 and December 2024, in each case to extend the repurchase window and increase the repurchase price (collectively, the "Amended Carbon Credit Agreement"). The Amended Carbon Credit Agreement (i) settled 19,300 Carbon Credits, (ii) extended the repurchase window from December 2024 to August 2025 for the remaining 370,700 Carbon Credits and (iii) revised the repurchase price to € 69.16 per Carbon Credit, for an aggregate amount of € 25.6 million.
In December 2023, Grundartangi also entered into a second structured repurchase agreement with Glencore pursuant to which it sold 40,000 Carbon Credits at a price of € 69.30 per Carbon Credit and agreed to repurchase the same number of Carbon Credits at a price of € 70.71 per Carbon Credit for an aggregate amount of € 2.8 million (the "Second Carbon Credit Agreement"). In March 2024 and August 2024, the Second Carbon Credit Agreement was amended to (i) increase the number of Carbon Credits subject to the Second Carbon Agreement by 19,300 credits, (ii) extend the repurchase window from March 2024 to August 2024 with respect to all 59,300 Carbon Credits and (iii) revised the purchase price to € 186.74 per Carbon Credit, for an aggregate amount of € 11.1 million. On August 30, 2024 all 59,300 Carbon Credits subject to the Second Carbon Credit Agreement were settled in full.
Due to the repurchase element of these transactions, the Company retains substantially all of the remaining benefits of the assets and has accounted for the transaction as a financing arrangement in accordance with Topic 606, Revenue from Contracts with Customers ("ASC 606").
3. Revenue
We enter into contracts to sell mainly primary aluminum to our customers. Revenue is recognized when our performance obligations with our customers are satisfied. Our obligations under the contracts are satisfied when we transfer control of our primary aluminum to our customers which is generally upon shipment or delivery to customer directed locations. The amount of consideration we receive, thus the revenue we recognize, is a function of volume delivered, market price of primary aluminum, which is based on the LME, plus regional premiums and any value-added product premiums or alumina which is based on the alumina pricing index, plus Atlantic differential.
The payment terms and conditions in our contracts vary and are not significant to our revenue. We complete an appropriate credit evaluation for each customer at contract inception. Customer payments are due in arrears and are recognized as accounts receivable - net and due from affiliates in our Consolidated Balance Sheets.
In connection with our sales agreements with certain customers, including Glencore, we invoice the customer prior to physical shipment of goods for a majority of production generated from each of our U.S. domestic smelters. For those sales, revenue is recognized only when the customer has specifically requested such treatment and has made a commitment to purchase the product. The goods must be complete, ready for shipment and separated from other inventory with control over the goods passing to the customer. We must retain no further performance obligations.
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CENTURY ALUMINUM COMPANY
Condensed Notes to the Consolidated Financial Statements (continued)
(amounts in millions, except share and per share amounts)
(Unaudited)
Contract liabilities are recorded when cash payments are received or due in advance of performance. Amounts recognized in Due to affiliates was $ 50.3 million and $ 41.2 million, as of March 31, 2025 and December 31, 2024, respectively.
The table below shows the amount of net sales to external customers for each of the Company's product categories which accounted for 10% or more of consolidated net sales in either period for the three months ended March 31, 2025 and 2024.
Net Sales Three months ended March 31,
2025 2024
Aluminum $ 535.8 $ 449.4
Alumina 98.1 40.1
Total $ 633.9 $ 489.5
Our net sales are attributed to geographic area based on the location of the selling entity. Included in the consolidated financial statements are the following amounts related to geographic locations:
Three months ended
March 31,
2025 2024
Net sales: (1)
United States $ 413.8 $ 300.0
Iceland 220.1 189.5
Total Net sales
$ 633.9 $ 489.5
(1) Includes sales of primary aluminum, scrap aluminum and alumina, and purchased aluminum and alumina.
4. Income Taxes
For the three months ended March 31, 2025 and 2024, we recorded income tax expense of $ 1.6 million and $ 0.5 million, respectively. The change is primarily due to changes in pretax income amounts and jurisdictional mix on a year over year basis.
Our income tax expense or benefit for interim periods is determined using an estimate of our annual effective tax rate, adjusted for discrete items. The application of the accounting requirements for income taxes in interim periods, after consideration of our valuation allowance on domestic losses, causes a significant variation in the typical relationship between income tax expense/benefit and pre-tax accounting income/loss as reported on the Consolidated Statements of Operations.
As of March 31, 2025, all of Century's U.S. and certain foreign deferred tax assets, net of deferred tax liabilities, continue to be subject to a full valuation allowance.
Section 45X of the Inflation Reduction Act of 2022 ("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 issued final regulations on the production tax credit requirements under Internal Revenue Code Section 45X (the "IRA Regulations"). The IRA Regulations provide guidance on rules that taxpayers must satisfy to qualify for the IRA Section 45X tax credit. For the three months ended March 31, 2025 and 2024, the Company recognized a reduction of $ 19.9 million and $ 11.9 million in Cost of goods sold and a reduction of $ 0.8 million and $ 0.7 million in Selling, general and administrative expenses, respectively, within the Consolidated Statements of Operations. As of March 31, 2025 and December 31, 2024, the Company recognized a current manufacturing credit receivable of $ 81.5 million. As of March 31, 2025, and December 31, 2024, the Company recognized a non-current manufacturing credit receivable of $ 91.1 million and $ 70.4 million, respectively.
5. Earnings Per Share
Basic earnings per share ("EPS") amounts are calculated by dividing earnings available to common stockholders by the
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CENTURY ALUMINUM COMPANY
Condensed Notes to the Consolidated Financial Statements (continued)
(amounts in millions, except share and per share amounts)
(Unaudited)
weighted average number of common shares outstanding using the two-class method. Diluted EPS is calculated by dividing net income attributable to common shareholders by the weighted average number of common and dilutive common equivalent shares outstanding during the period. Dilutive common equivalent shares are calculated using the more dilutive of either the if-converted or two-class methods.
The following table shows the basic and diluted earnings per share:
For the three months ended March 31,
2025
2024
Net Income (Loss) Shares
(in millions)
Per Share Net Income (Loss) Shares
(in millions)
Per Share
Net income attributable to Century stockholders $ 29.7 $ 246.8
Less: net income allocated to participating securities 1.5 13.2
Basic EPS:
Net income allocated to common stockholders $ 28.2 93.3 $ 0.30 $ 233.6 92.7 $ 2.52
Effect of Dilutive Securities (1) :
Share-based compensation — 1.3 ( 12.7 ) 1.4
Convertible senior notes 0.7 4.6 1.9 4.6
Diluted EPS:
Net income allocated to common stockholders $ 28.9 99.2 $ 0.29 $ 222.8 98.7 $ 2.26
Three months ended
March 31,
Securities excluded from the calculation of diluted EPS (in millions) (1) :
2025 2024
Share-based compensation 0.7 —
Convertible preferred shares 5.0 5.2
(1) In periods when we report a net loss, all share-based compensation awards, convertible preferred shares and convertible senior notes are excluded from the calculation of diluted weighted average shares outstanding because of their anti-dilutive effect on earnings (loss) per share.
6. Accumulated Other Comprehensive Loss ("AOCL")
Components of AOCL: March 31, 2025
December 31, 2024
Defined benefit plan liabilities
$ ( 105.2 ) $ ( 107.0 )
Unrealized gain on financial instruments 1.3 1.4
Other comprehensive loss before income tax effect
( 103.9 ) ( 105.6 )
Income tax effect (1)
2.3 2.3
Accumulated other comprehensive loss
$ ( 101.6 ) $ ( 103.3 )
(1) The allocation of the income tax effect to the components of other comprehensive loss is as follows:
March 31, 2025
December 31, 2024
Defined benefit plan liabilities $ 2.6 $ 2.6
Unrealized gain on financial instruments ( 0.3 ) ( 0.3 )
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CENTURY ALUMINUM COMPANY
Condensed Notes to the Consolidated Financial Statements (continued)
(amounts in millions, except share and per share amounts)
(Unaudited)
The following table summarizes the changes in the accumulated balances for each component of AOCL:
Defined benefit plan and other postretirement liabilities Unrealized gain on financial instruments Total, net of tax
Balance, December 31, 2024 $ ( 104.6 ) $ 1.3 $ ( 103.3 )
Other comprehensive loss before reclassifications — — —
Net amount reclassified to net income (loss) $ 1.7 $ — $ 1.7
Balance, March 31, 2025 $ ( 102.9 ) $ 1.3 $ ( 101.6 )
Balance, December 31, 2023 $ ( 99.4 ) $ 1.5 $ ( 97.9 )
Other comprehensive loss before reclassifications $ ( 3.4 ) — $ ( 3.4 )
Net amount reclassified to net income (loss) 1.8 ( 0.1 ) 1.7
Balance, March 31, 2024 $ ( 101.0 ) $ 1.4 $ ( 99.6 )
Reclassifications out of AOCL were included in the Consolidated Statements of Operations as follows:
Three months ended
March 31,
AOCL Components Location 2025 2024
Defined benefit plan and other postretirement liabilities Cost of goods sold $ 0.8 $ 0.9
Selling, general and administrative expenses 0.2 0.2
Other operating expense - net 0.7 0.7
Income tax effect — —
Net of tax $ 1.7 $ 1.8
Unrealized gain on financial instruments Cost of goods sold $ — $ ( 0.1 )
Income tax effect — —
Net of tax $ — $ ( 0.1 )
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CENTURY ALUMINUM COMPANY
Condensed Notes to the Consolidated Financial Statements (continued)
(amounts in millions, except share and per share amounts)
(Unaudited)
7. Components of Net Periodic Benefit Cost
Pension Benefits
Three months ended
March 31,
2025 2024
Service cost $ 0.7 $ 0.6
Interest cost 3.3 3.5
Expected return on plan assets ( 3.9 ) ( 3.8 )
Amortization of prior service costs 0.1 0.1
Amortization of net loss 1.4 1.7
Net periodic benefit cost $ 1.6 $ 2.1
Other Postretirement Benefits
Three months ended
March 31,
2025 2024
Interest cost $ 1.0 $ 1.0
Amortization of net loss 0.2 —
Net periodic benefit cost $ 1.2 $ 1.0
8. Inventories
Inventories consist of the following:
March 31, 2025 December 31, 2024
Raw materials $ 153.3 $ 180.8
Work-in-process 57.4 52.1
Finished goods 87.6 74.6
Operating and other supplies 243.9 231.5
Total inventories $ 542.2 $ 539.0
Inventories are stated at the lower of cost or Net Realizable Value ("NRV") using the first-in, first-out or the weighted average cost method.
9. Fair Value Measurements
We measure certain of our assets and liabilities at fair value. Fair value represents the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
In general, reporting entities should apply valuation techniques to measure fair value that maximize the use of observable inputs and minimize the use of unobservable inputs. Observable inputs are developed using market data and reflect assumptions that market participants would use when pricing the asset or liability. Unobservable inputs are developed using the best information available about the assumptions that market participants would use when pricing the asset or liability.
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CENTURY ALUMINUM COMPANY
Condensed Notes to the Consolidated Financial Statements (continued)
(amounts in millions, except share and per share amounts)
(Unaudited)
The fair value hierarchy provides transparency regarding the inputs we use to measure fair value. We categorize each fair value measurement in its entirety into the following three levels, based on the lowest level input that is significant to the entire measurement:
• Level 1 Inputs - quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity can access at the measurement date.
• Level 2 Inputs - inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
• Level 3 Inputs - unobservable inputs for the asset or liability.
Recurring Fair Value Measurements As of March 31, 2025
Level 1
Level 2
Level 3
Total
ASSETS:
Cash equivalents $ 2.8 $ — $ — $ 2.8
Trust assets (1)
1.5 — — 1.5
Derivative instruments — 8.1 — 8.1
TOTAL $ 4.3 $ 8.1 $ — $ 12.4
LIABILITIES:
Derivative instruments $ — $ 11.4 $ — $ 11.4
TOTAL $ — $ 11.4 $ — $ 11.4
Recurring Fair Value Measurements As of December 31, 2024
Level 1
Level 2
Level 3
Total
ASSETS:
Cash equivalents $ 7.9 $ — $ — $ 7.9
Trust assets (1)
0.3 — — 0.3
Derivative instruments — 4.5 — 4.5
TOTAL $ 8.2 $ 4.5 $ — $ 12.7
LIABILITIES:
Derivative instruments $ — $ 4.4 $ — $ 4.4
TOTAL $ — $ 4.4 $ — $ 4.4
(1) Trust assets are currently invested in money market funds. These trust assets are held to fund the non-qualified supplemental executive pension benefit obligations for certain of our officers.
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Condensed Notes to the Consolidated Financial Statements (continued)
(amounts in millions, except share and per share amounts)
(Unaudited)
The following section describes the valuation techniques and inputs for fair value measurements categorized within Level 2 of the fair value hierarchy:
Level 2 Fair Value Measurements:
Asset / Liability Valuation Techniques Inputs
LME forward financial sales contracts Discounted cash flows Quoted LME forward market, Secured Overnight Financing Rate ("SOFR") discount rate
Midwest Premium ("MWP") forward financial sales contracts Discounted cash flows Quoted MWP forward market, SOFR discount rate
Fixed for floating swaps Discounted cash flows Quoted LME forward market, quoted MWP forward market
Indiana Hub power price swaps Discounted cash flows Quoted Indiana Hub forward market, SOFR discount rate
Heavy Fuel Oil ("HFO") price swaps Discounted cash flows Quoted HFO forward market
When valuing Level 3 assets and liabilities, we use certain significant unobservable inputs. Management incorporates various inputs and assumptions including forward commodity prices, commodity price volatility and macroeconomic conditions, including interest rates and discount rates. Our estimates of significant unobservable inputs are ultimately based on our estimates of risks that market participants would consider when valuing our assets and liabilities.
During the three months ended March 31, 2025 and 2024, there were no Level 3 assets and liabilities measured at fair value on a recurring basis.
10. Derivatives
As of March 31, 2025, we had an open position of 36,600 tonnes re lated to LME forward financial sales contracts to fix the forward LME aluminum price. These contracts are expected to settle monthly through September 2026 . We also had an open position o f 36,600 t onnes related to MWP forward financial sales contracts to fix the forward MWP price. These contracts are expected to settle monthly through September 2026 . We also enter into financial contracts with various counterparties to offset fixed price sales arrangements with certain of our customers ("fixed for floating swaps") to remain exposed to the LME and MWP aluminum prices. As of March 31, 2025, we had 1,270 tonnes open fixed for floating swaps. These contracts are expected to settle monthly through November 2025.
We have entered into financial contracts to hedge a portion of our Jamalco fuel cost exposure ("HFO price swaps"). The volume of heavy fuel oil ("HFO") consumed at Jamalco is measured per barrel and as of March 31, 2025, we had an open position of 300,000 barrels. The HFO price swaps are expected to settle monthly thr ough March 2026.
We have entered into financial contracts to fix a portion of our exposure to the Indiana Hub power market at our Sebree plant ("Indiana Hub power price swaps"). As of March 31, 2025, we had an open position of 677,712 MWh. The Indiana Hub power price swaps are expected to settle monthly throug h September 2026 .
Our agreements with derivative counterparties contain certain provisions requiring collateral to be posted in the event the market value of our position exceeds the margin threshold limit of our master agreement with the counterparty. As of March 31, 2025 and December 31, 2024, the Company had no recorded restricted cash as collateral related to open derivative contracts under the master arrangements with our counterparties.
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Condensed Notes to the Consolidated Financial Statements (continued)
(amounts in millions, except share and per share amounts)
(Unaudited)
The following tables set forth the Company's derivative assets and liabilities that were accounted for at fair value and not designated as cash flow hedges as of March 31, 2025 and December 31, 2024, respectively:
Asset Fair Value
March 31, 2025 December 31, 2024
Commodity contracts (1)
$ 8.1 $ 4.5
Liability Fair Value
March 31, 2025 December 31, 2024
Commodity contracts (1)
$ 11.4 $ 4.4
(1) Commodity contracts reflect our outstanding LME and MWP forward financial sales contracts, Indy Hub power price swaps, fixed for floating swaps, and HFO price swaps. At March 31, 2025, and December 31, 2024, there were no commodity contracts with Glencore.
The following table summarizes the net (loss) gain on forward and derivative contracts:
Three months ended
March 31,
2025 2024
Commodity contracts (1)
$ ( 5.5 ) $ 7.3
Foreign exchange contracts — 0.1
Total $ ( 5.5 ) $ 7.4
(1) For the three months ended March 31, 2025, there were no forward and derivative contracts with Glencore. For the three months ended March 31, 2024, $ 4.0 million of the net gain was with Glencore.
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Condensed Notes to the Consolidated Financial Statements (continued)
(amounts in millions, except share and per share amounts)
(Unaudited)
11. Debt
March 31, 2025 December 31, 2024
Debt classified as current liabilities:
Hancock County industrial revenue bonds ("IRBs") due April 1, 2028 , interest payable quarterly (variable interest rates (not to exceed 12 %) ) (1)
$ 7.8 $ 7.8
U.S. Revolving Credit Facility (2)
2.0 20.0
Iceland Revolving Credit Facility (3)
9.5 34.0
Grundartangi Casthouse Facility (4)
9.0 9.0
Debt classified as non-current liabilities:
Grundartangi Casthouse Facility, net of financing fees of $ 1.0 million at March 31, 2025 (4)
110.9 114.2
Vlissingen Credit Facility (5)
10.0 10.0
7.5 % senior secured notes due April 1, 2028, net of financing fees of $ 1.8 million at March 31, 2025, interest payable semiannually
248.2 248.1
2.75 % convertible senior notes due May 1, 2028, net of financing fees of $ 1.1 million at March 31, 2025, interest payable semiannually
85.2 85.1
Total $ 482.6 $ 528.2
(1) The IRBs are classified as current liabilities because they are remarketed weekly and could be required to be repaid upon demand if there is a failed remarketing. The interest rate at March 31, 2025 was 3.00 % .
(2) We incur interest at a base rate plus applicable margin as defined within the agreement. The interest rate at March 31, 2025 was 8.25 % .
(3) We incur interest at a base rate plus applicable margin as defined within the agreement. The interest rate at March 31, 2025 wa s 7.80 % .
(4) We incur interest at a base rate plus applicable margin as defined within the agreement. The interest rate at March 31, 2025 was 8.05 %.
(5) We incur interest at a base rate plus applicable margin as defined within the agreement. The interest rate at March 31, 2025 was 7.99 % .
7.5 % Senior Secured Notes due 2028
In April 2021, we issued $ 250.0 million in aggregate principal amount of 7.5 % senior secured notes due April 1, 2028 (the "2028 Notes"). We received proceeds of $ 245.2 million, after payment of certain financing fees and related expenses. The 2028 Notes bear interest semi-annually in arrears on April 1 and October 1 of each year, which began on October 1, 2021, at a rate of 7.5 % per annum in cash. The 2028 Notes are senior secured obligations of Century, ranking equally in right of payment with all existing and future senior indebtedness of Century, but effectively senior to unsecured debt to the extent of the value of collateral.
As of March 31, 2025, the total estimated fair value of the 2028 Notes was $ 253.2 million . Although we use quoted market prices for identical debt instruments, the markets on which they trade are not considered to be active and are therefore considered Level 2 fair value measurements.
2.75 % Convertible Notes due 2028
In April 2021, we completed a private offering of $ 86.3 million aggregate principal amount of convertible senior notes due May 1, 2028 unless earlier converted, repurchased, or redeemed (the "Convertible Notes"). The Convertible Notes were issued at a price of 100 % of their aggregate principal amount. We received proce eds of $ 83.7 million, a fter payment of certain financing fees and related expenses. The Convertible Notes bear interest semi-annually in arrears on May 1 and November 1 of each year, which began on November 1, 2021, at a rate of 2.75 % per annum in cash.
The initial conversion rate for the Convertible Notes is 53.3547 shares of the Company's common stock per $1,000 principal amount of Convertible Notes, which is equivalent to an initial conversion price of approximately $ 18.74 per share of
the Company's common stock. The conversion rate and conversion price are subject to customary adjustments under certain circumstances in accordance with the terms of the indenture. As of March 31, 2025, the conversion rate remains unchanged .
The Convertible Notes are the Company’s senior unsecured obligations and rank senior in right of payment to any of the Company’s indebtedness that is expressly subordinated in right of payment to the Convertible Notes; equal in right of payment to any of the Company’s unsecured indebtedness that is not so subordinated; effectively junior in right of payment to any of the Company’s senior secured indebtedness to the extent of the value of the assets securing such indebtedness; and structurally junior to all indebtedness and other liabilities (including trade payables) of the Company’s subsidiaries.
As of March 31, 2025, the if-converted value of the Convertible Not es did not exceed the outstanding principal amount.
As of March 31, 2025, the total estimated fair value of the Convertible Notes was $ 103.7 million . Although we use quoted market prices for identical debt instruments, the markets on which they trade are not considered to be active and are therefore considered Level 2 fair value measurements.
U.S. Revolving Credit Facility
We and certain of our direct and indirect domestic subsidiaries have a senior secured revolving credit facility with a syndicate of lenders (as amended from time to time, the "U.S. revolving credit facility"). On June 14, 2022 we amended our U.S. revolving credit facility, increasing our borrowing capacity to $ 250.0 million in the aggregate, including up to $ 150.0 million under a letter of credit sub-facility. The U.S. revolving credit facility matures on June 14, 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. At March 31, 2025, there were $ 2.0 million of outstanding borrowings and $ 63.7 million of outstanding letters of credit issued under our U.S. revolving credit facility. Principal payments, if any, are due upon maturity of the U.S. revolving credit facility and may be prepaid without penalty.
Status of our U.S. revolving credit facility: March 31, 2025
Credit facility maximum amount $ 250.0
Borrowing availability 189.4
Outstanding letters of credit issued 63.7
Outstanding borrowings 2.0
Borrowing availability, net of outstanding letters of credit and borrowings 123.7
Iceland Revolving Credit Facility
Our wholly-owned subsidiary, Nordural Grundartangi ehf ("Grundartangi"), entered into a revolving credit facility agreement with Landsbankinn hf., dated November 2013, as amended (the "Iceland revolving credit facility"), which originally provided for borrowings of up to $ 50.0 million in the aggregate. On February 4, 2022, we amended the Iceland revolving credit facility and increased the facility amount to $ 80.0 million. On September 28, 2022, we further amended the Iceland revolving credit facility and increased the facility amount to $ 100.0 million in the aggregate. Under the terms of the Iceland revolving credit facility, when Grundartangi borrows funds it will designate a repayment date, which may be any date prior to the maturity of the Iceland revolving credit facility. At March 31, 2025, there were $ 9.5 million of outstanding borrowings under our Iceland revolving credit facility. The Iceland revolving credit facility has a term through December 2026.
Status of our Iceland revolving credit facility: March 31, 2025
Credit facility maximum amount $ 100.0
Borrowing availability 100.0
Outstanding letters of credit issued —
Outstanding borrowings 9.5
Borrowing availability, net of borrowings 90.5
Grundartangi Casthouse Facility
On November 2, 2021, in connection with the casthouse project at Grundartangi, we entered into an eight-year Term Facility Agreement with Arion Bank hf, to provide for borrowings up to $ 130.0 million (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 in December 2029. As of March 31, 2025, there were $ 119.9 million in outstanding borrowings under the Casthouse Facility.
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 (as amended, the "Vlissingen Credit Facility"). 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 either (i) 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 "Variable Rate"). 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 March 31, 2025, there were $ 10.0 million in outstanding borrowings under the Vlissingen Credit Facility.
Hancock County Industrial Revenue Bond s
As part of the purchase price for our acquisition of the Hawesville facility, we assumed IRBs which were issued in connection with the financing of certain solid waste disposal facilities constructed at the Hawesville facility. The IRBs bear interest at a variable rate not to exceed 12 % per annum determined weekly based upon prevailing rates for similar bonds in the industrial revenue bond market and interest on the IRBs is paid quarterly. The IRBs are secured by a letter of credit issued under our U.S revolving credit facility and mature in April 2028.
Surety Bond Facility
As part of our normal business operations, we are required to provide surety bonds or issue letters of credit in certain states in which we do business as collateral for certain workers' compensation obligations. In June 2022, we entered into a surety bond facility with an insurance company to provide such bonds when applicable. As of March 31, 2025, we had issued surety bonds totaling $ 6.6 million . As we had previously guaranteed our workers' compensation obligations through issuance of letters of credit against our revolving credit facility, the surety bond issuance increases credit facility availability.
Covenant Compliance
As of March 31, 2025, we and our subsidiaries were in compliance with financial covenants or maintained availability above applicable covenant triggers.
12. Commitments and Contingencies
We have pending against us or may be subject to various lawsuits, claims and proceedings related primarily to employment, commercial, stockholder, environmental, safety and health matters and are involved in other matters that may give rise to contingent liabilities. While the results of such matters and claims cannot be predicted with certainty, we believe that the ultimate outcome of any such matters and claims will not have a material adverse impact on our financial condition, results of operations or liquidity. However, because of the nature and inherent uncertainties of litigation and estimating liabilities, should the resolution or outcome of these actions be unfavorable, our business, financial condition, results of operations and liquidity could be materially and adversely affected.
In evaluating whether to accrue for losses associated with legal or environmental contingencies, it is our policy to take into consideration factors such as the facts and circumstances asserted, our historical experience with contingencies of a similar nature, the likelihood of our prevailing and the severity of any potential loss. For some matters, no accrual is established because we have assessed our risk of loss to be remote. Where the risk of loss is probable and the amount of the loss can be
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Condensed Notes to the Consolidated Financial Statements (continued)
(amounts in millions, except share and per share amounts)
(Unaudited)
reasonably estimated, we record an accrual, either on an individual basis or with respect to a group of matters involving similar claims, based on the factors set forth above. While we regularly review the status of, and our estimates of potential liability associated with, contingencies to determine the adequacy of any associated accruals and related disclosures, the ultimate amount of loss may differ from our estimates.
Legal Contingencies
Ravenswood Retiree Medical Benefits
In November 2009, Century Aluminum of West Virginia ("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 the agreement, 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 10 years. Upon approval of the settlement, we paid $ 5.0 million to the aforementioned trust in September 2017 and recognized a gain of $ 5.5 million to arrive at the then-net present value of $ 12.5 million. CAWV has agreed to pay the remaining amounts under the settlement agreement in annual increments of $ 2.0 million for nine years . As of March 31, 2025, $ 2.0 million was recorded in Accrued and other current liabilities and $ 1.7 million was recorded in Other liabilities.
PBGC Settlement
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 f acility (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 the next 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, 2025, we have made contributions of $ 7.2 million related to the Amended PBGC Settlement Agreement.
Power Commitments and Contingencies
Hawesville and Sebree
Hawesville and Sebree each has a power supply arrangement with Kenergy and Century Marketer, LLC ("Century Marketer"), Century's wholly-owned subsidiary that acts as a Midcontinent Independent System Operator ("MISO") market participant. Under these arrangements, Hawesville and Sebree get access to power at MISO pricing plus transmission and other costs. As the MISO Market Participant, Century Marketer purchases power from MISO for resale to Kenergy, which then resells the power to Hawesville and Sebree. Century Marketer's power supply arrangement with Kenergy has an effective term through May 31, 2028, with automatic one-year extensions unless either party provides one-year notice of termination prior to the May 31 anniversary date. Similarly, Kenergy's power supply contracts with Hawesville and Sebree both have a term through December 31, 2026, with automatic one-year extensions unless either party provides one-year notice of termination prior to the December 31 anniversary date.
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Condensed Notes to the Consolidated Financial Statements (continued)
(amounts in millions, except share and per share amounts)
(Unaudited)
Mt. Holly
Century Aluminum of South Carolina ("CASC") has a power supply agreement with Santee Cooper that has an effective term through December 2026. Under this power supply agreement, 100 % of Mt. Holly’s electrical power requirements are supplied from Santee Cooper’s generation at cost of service based rates.
Grundartangi
Grundartangi has power purchase agreements for approximately 545 MW of aggregate power with HS Orka hf ("HS"), Landsvirkjun and Orkuveita Reykjavikur ("OR"). These power purchase agreements expire on various dates from 2026 through 2036 (subject to extension). The power purchase agreements with each of HS and OR provide power at LME-based variable rates for the duration of these agreements. The larger Landsvirkjun agreement provides for fixed rate with an additional variable rate linked to the LME. Grundartangi also has a separate 25 MW power purchase agreement with Landsvirkjun at an LME-based variable rate.
Other Commitments and Contingencies
Labor Commitments
The bargaining unit employees at our Grundartangi, Vlissingen, Hawesville, Sebree and Jamalco facilities are represented by labor unions, representing approximately 59 % of our total workforce.
Approximately 86 % of Grundartangi’s work force is represented by five labor unions, governed by a labor agreement that establishes wages and work rules for covered employees. This agreement was ratified on April 22, 2025, and is effective through December 31, 2030.
100 % of Vlissingen's work force is represented by the Federation for the Metal and Electrical Industry ("FME"), a Netherlands' employers' organization for companies in the metal, electronics, electrical engineering and plastic sectors. The FME negotiates working conditions with trade unions on behalf of its members, which, when agreed upon, are then applicable to all employees of Vlissingen. The current labor agreement is effective through December 31, 2025.
Approximately 40 % of our U.S. based work force is represented by USW through separately negotiated labor agreements for each facility. The labor agreement for Hawesville employees is effective through April 1, 2026. Upon announcement of the curtailment, Hawesville and the USW local union entered into effects bargaining. An agreement was reached on July 19, 2022, covering the curtailment period. Century Sebree's labor agreement with the USW for its employees is effective through October 28, 2028. Mt. Holly employees are not represented by a labor union.
Approximately 61 % of Jamalco’s work force is represented by the Union of Technical, Administrative, and Supervisory Personnel ("UTASP") through separately negotiated labor agreements for hourly and salaried employee groups. Both contracts were effective through December 31, 2023. Jamalco is currently in the process of negotiating new contracts with both the salaried and hourly employee groups. Until new contracts are reached, employees will continue to operate under the current agreements.
Contingent obligation
We have a contingent obligation in connection with the "unwind" of a contractual arrangement between CAKY, Big Rivers Electric Corporation ("Big Rivers") and a third party and the execution of a long-term cost-based power contract with Kenergy, a member of a cooperative of Big Rivers, in July 2009. 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 March 31, 2025, the principal and accrued interest for the contingent obligation was $ 32.7 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. Interest accrues at an annual rate equal to 10.94 %. As of March 31, 2025, based on the curtailment of Hawesville's 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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Condensed Notes to the Consolidated Financial Statements (continued)
(amounts in millions, except share and per share amounts)
(Unaudited)
13. Shareholders' Equity
Common Stock
As of March 31, 2025 and December 31, 2024, we had 195,000,000 shares of common stock, $ 0.01 par value per share, authorized under our Restated Certificate of Incorporation, of which 100,483,458 shares were issued and 93,296,937 shares were outstanding at March 31, 2025, and 100,475,086 were issued and 93,288,565 shares were outstanding at December 31, 2024.
The rights, preferences and privileges of holders of our common stock are subject to, and may be adversely affected by, the rights of the holders of shares of any series of our preferred stock which are currently outstanding, including our Series A Convertible Preferred Stock, or which we may designate and issue in the future.
Preferred Stock
As of March 31, 2025 and December 31, 2024, we had 5,000,000 shares of preferred stock, $ 0.01 par value per share, authorized under our Restated Certificate of Incorporation. Our Board of Directors may issue preferred stock in one or more series and determine for each series the dividend rights, conversion rights, voting rights, redemption rights, liquidating preferences, sinking fund terms and the number of shares constituting that series, as well as the designation thereof. Depending upon the terms of preferred stock established by our Board of Directors, any or all of the preferred stock could have preference over the common stock with respect to dividends and other distributions and upon the liquidation of Century. In addition, issuance of any shares of preferred stock with voting powers may dilute the voting power of the outstanding common stock.
Series A Convertible Preferred Stock
Shares Authorized and Outstanding . In 2008, we issued 160,000 shares of our Series A Convertible Preferred Stock. At March 31, 2025 and December 31, 2024, 49,679 and 49,715 shares of Series A Convertible Preferred Stock were outstanding, respectively. Glencore holds all of the issued and outstanding Series A Convertible Preferred Stock.
The issuance of common stock under our stock incentive programs, debt exchange transactions and any stock offering that excludes Glencore participation triggers anti-dilution provisions of the preferred stock agreement and results in the automatic conversion of Series A Convertible Preferred Stock shares into shares of common stock. The conversion of preferred to common shares is 100 shares of common stock for each share of preferred stock. Our Series A Convertible Preferred Stock has a par value of $ 0.01 per share.
Stock Repurchase Program
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. 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. The stock repurchase program may be suspended or discontinued at any time.
Shares of common stock repurchased are recorded at cost as treasury stock and result in a reduction of shareholders’ equity in the Consolidated Balance Sheets. From time to time, treasury shares may be reissued as contributions to our employee benefit plans and for the conversion of convertible preferred stock. When shares are reissued, we use an average cost method for determining cost. The difference between the cost of the shares and the reissuance price is added to or deducted from additional paid-in capital.
Through March 31, 2025 we repurchased 7,186,521 shares of common stock for an aggregate purchase price of $ 86.3 million. We have made no repurchases since April 2015 and have approximately $ 43.7 million remaining under the repurchase program authorization as of March 31, 2025.
14. Business Segments and Geographic Information
The Company is a producer of alumina and primary aluminum. The Company has organized itself, including management personnel and systems, financial processes, operational execution, governance and risk oversight, regulatory compliance, and
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Condensed Notes to the Consolidated Financial Statements (continued)
(amounts in millions, except share and per share amounts)
(Unaudited)
every other aspect of the Company’s operations, to assess and manage the business on a holistic basis, from mine to metal, which tracks the upstream manufacturing process for aluminum. To better reflect this operational and organizational approach, and to further enhance the reporting of its financial and operating results, beginning with the quarter ended March 31, 2025, the Company’s Chief Executive Officer and Chief Operating Decision Maker ("CODM") regularly receives and reviews financial information at the consolidated level to evaluate business performance and make operating decisions. The CODM uses the U.S. GAAP measure of consolidated Net Income to evaluate the Company’s financial performance and allocate resources.
Given the change described above, the Company has determined that neither its three smelters nor Jamalco’s mining and refining operations meet the definition of operating segments. As a result, the Company has determined that the Company has only one operating and only one reportable segment, and it is managed on a consolidated basis. In accordance with ASC 280-10-50-34, the corresponding information for earlier periods is recast in the tables below to conform with the updated presentation.
The CODM uses the U.S. GAAP measurement of consolidated Net income to develop forecasting, evaluate overall profitability performance and to make key operating decisions, such as the allocation of budget between sales, cost of good sold and selling, general and administrative expenses.
Segment assets is reported on our Consolidated Balance Sheets as Total assets. Our Consolidated Statements of Cash Flows presents Depreciation, depletion and amortization expense and includes the measure of Capital expenditures as Purchase of property, plant and equipment.
The following table presents information about the Company's single segment for the three months ended March 31, 2025 and 2024.
Three months ended
March 31,
2025 2024
Net sales $ 633.9 $ 489.5
Segment Cost of goods sold (1),(2)
( 574.8 ) ( 469.5 )
IRA Credit (1),(3)
19.9 11.9
Lower of cost or NRV inventory adjustment (1),(4)
3.1 5.6
Property and equipment expense (1),(5)
( 21.5 ) ( 21.0 )
Selling, general and administrative expenses ( 12.5 ) ( 14.1 )
Other operating expense - net ( 2.0 ) ( 0.5 )
Interest expense - affiliates ( 1.8 ) ( 1.8 )
Interest expenses - nonaffiliates ( 10.0 ) ( 7.4 )
Interest income 1.8 0.7
Net gain (loss) on forward and derivative contracts - nonaffiliates ( 5.4 ) 3.4
Net gain (loss) on forward and derivative contracts - affiliates — 4.0
Bargain purchase gain — 245.9
Other income (loss) - net ( 3.4 ) ( 1.5 )
Income tax expense ( 1.6 ) ( 0.5 )
Net income $ 25.7 $ 244.7
(1) Indicates a component of Cost of goods sold.
(2) Includes raw materials, labor, energy, freight costs, FIFO inventory adjustments and other direct cost of goods sold.
(3) Advanced production credit related to Section 45X of the IRA.
(4) Includes inventory revaluation to lower of cost or net realizable value and changes in inventory reserve.
(5) Represents the depreciation expenses and expenses related to leased assets that are directly related the cost of goods sold. Depreciation expense is also a component of Selling, general and administrative expenses.
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CENTURY ALUMINUM COMPANY
Condensed Notes to the Consolidated Financial Statements (continued)
(amounts in millions, except share and per share amounts)
(Unaudited)
15. Variable Interest Entity
The Company consolidates Jamalco, a bauxite mining and alumina refinery in Jamaica, under the variable interest entity ("VIE") model. The Company's wholly-owned subsidiary, GAJL, is the managing partner of Jamalco. Jamalco lacks sufficient equity investment at risk in accordance with relevant guidance. Based on its purpose and design, Jamalco is expected to require additional subordinated financial support, such as those in the form of equity contributions or other forms of subordinated financing, which the Company expects would require parent guarantees. To that end, the Company made an immediate equity contribution to Jamalco upon acquisition and has provided subsequent financing of costs for Jamalco to perform its activities in the ordinary course of business. Jamalco was designed in order to distribute operations risk related to the mining and alumina refining operations, as well as commodity price risk.
Although our partner has certain participating rights over some decisions of the entity, the Company has power over the majority of key activities at Jamalco that significantly affect its economic performance over which the counterparty does not have such participating rights; therefore, the Company is the primary beneficiary of the VIE.
The table below shows the carrying amounts and classification of the consolidated VIE's assets and liabilities included in the Consolidated Balance Sheets as of March 31, 2025 and December 31, 2024.
March 31, 2025 December 31, 2024
ASSETS
Cash and cash equivalents 43.3 17.4
Accounts receivable - net 1.1 1.1
Non-trade receivables — 13.1
Due from affiliates — 75.1
Inventories 90.6 109.8
Prepaid and other current assets 1.9 2.0
Total current assets 136.9 218.5
Property, plant and equipment - net 40.5 232.1
Other assets 10.8 23.1
TOTAL 188.2 473.7
LIABILITIES
LIABILITIES:
Accounts payable, trade 35.7 39.1
Accrued compensation and benefits 5.4 8.5
Due to affiliates 15.0 49.6
Accrued and other current liabilities 3.2 7.2
Total current liabilities 59.3 104.4
Accrued benefits costs - less current portion — 17.7
Other liabilities 62.7 66.7
Asset retirement obligations - less current portion 10.8 35.0
Total noncurrent liabilities 73.5 119.4
TOTAL
132.8 223.8
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FORWARD-LOOKING STATEMENTS
This quarterly report includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, which are subject to the "safe harbor" created by section 27A of the Securities Act of 1933, as amended, and section 21E of the Securities Exchange Act of 1934 (the "Exchange Act"), as amended. Forward-looking statements are statements about future events and are based on our current expectations. These forward-looking statements may be identified by the words "believe," "expect," "hope," "target," "anticipate," "intend," "plan," "seek," "estimate," "potential," "project," "scheduled," "forecast" or words of similar meaning, or future or conditional verbs such as "will," "would," "should," "could," "might," or "may."
Forward-looking statements in this quarterly report and in our other reports filed with the Securities and Exchange Commission (the "SEC"), for example, may include, but are not limited to, statements regarding:
• Our assessment of global and local financial and economic conditions;
• Our assessment of the alum inum market and aluminum prices (including premiums);
• Our assessment of prices of our key raw materials and supply and availability of those key raw materials, including alumina, coke, pitch and aluminum fluoride;
• Our assessment of power prices and availability, including any potential curtailments or other disruptions in the supply of power;
• The impact of the wars in Ukraine and in the Middle East, including any sanctions and export controls targeting Russia and businesses or individuals tied to Russia;
• The future financial and operating performance of the Company and its subsidiaries;
• Our ability to successfully manage market risk and to control or reduce costs;
• Our plans and expectations with respect to future operations of the Company and its subsidiaries, including any plans and expectations to curtail or restart production, including the expected impact of any such actions on our future financial and operating performance;
• Our plans and expectations with regards any restart of curtailed production at Mt. Holly including the timing, costs and benefits associated with restarting curtailed production;
• Our plans with regards to the future of our Hawesville smelter;
• Our ability to successfully obtain and/or retain competitive power arrangements for our operations, including securing necessary power arrangement for the greenfield project;
• The impact of Section 232 and 301 and other trade actions, including tariffs or other trade remedies, the extent to which any such remedies may be changed, including through exclusions or exemptions, and the duration of any trade remedy;
• The impact of any new or changed law, regulation, including, without limitation, sanctions or other similar remedies or restrictions or any changes in interpretation of existing laws or regulations;
• Our anticipated tax liabilities, benefits or refunds including the realization of U.S. and certain foreign deferred tax assets and liabilities;
• Our ability to qualify for and realize potential tax benefits under the Inflation Reduction Act of 2022 and the anticipated amounts of such benefits;
• Our expectations regarding the availability of the $500 million DOE funding to our new smelter project, including our ability to raise additional capital through additional grants, incentives, subsidized loans and other debt and equity funding to support construction of a new aluminum smelter and our ability to successfully complete our new smelter project;
• Our ability to access existing or future financing arrangements and the terms of any such future financing arrangements;
• Our ability to repay or refinance debt in the future;
• Our ability to recover losses from our insurance;
• Our assessment and estimates of our pension and other postretirement liabilities, legal and environmental liabilities and other contingent liabilities;
• Our assessment of any future tax audits and expected outcomes;
• Negotiations with current labor unions or future representation by a union of our employees;
• Our assessment of any information technology-related risks, including the risk from cyberattacks or other data security breaches;
• Our plans and expectations regarding potential M&A and joint venture activity including our ability to consummate such transactions and our assessments of certain risks associated with the same, including, for example, unforeseen costs and expenses associated with unidentified liabilities, and difficulties integrating an acquired asset into our existing operations; and
• Our future business objectives, plans, strategies and initiatives, including our competitive position and prospects.
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Where we express an expectation or belief as to future events or results, such expectation or belief is expressed in good faith and believed to have a reasonable basis. However, our forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from future results expressed, projected or implied by those forward-looking statements. Important factors that could cause actual results and events to differ from those described in such forward-looking statements can be found in the risk factors and forward-looking statements cautionary language contained in Item 1A. Risk Factors in our Annual Report on Form 10-K, quarterly reports on Form 10-Q and in other filings made with the SEC. Although we have attempted to identify those material factors that could cause actual results or events to differ from those described in such forward-looking statements, there may be other factors that could cause actual results or events to differ from those anticipated, estimated or intended. Many of these factors are beyond our ability to control or predict. Given these uncertainties, the reader is cautioned not to place undue reliance on our forward-looking statements. We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events, or otherwise.
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Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.