Delaware
(State or other jurisdiction of incorporation or organization) |
13-3070826
(IRS Employer Identification No.) |
One South Wacker Drive
Suite 1000
Chicago, Illinoi s
(Address of principal executive offices)
|
60606
(Zip Code) |
Large accelerated filer
|
x
|
Accelerated filer
|
o
|
Non-accelerated filer
(Do not check if a smaller reporting company)
|
o
|
Smaller reporting company
|
o
|
TABLE OF CONTENTS
|
|
|
Page
|
|
|
|
|
|
|
CENTURY ALUMINUM COMPANY
|
|||||||
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|||||||
(in thousands, except per share amounts)
|
|||||||
(Unaudited)
|
|||||||
|
Three months ended March 31,
|
||||||
|
2015
|
|
2014
|
||||
NET SALES:
|
|
|
|
||||
Related parties
|
$
|
575,729
|
|
|
$
|
285,583
|
|
Third-party customers
|
12,182
|
|
|
135,264
|
|
||
Total net sales
|
587,911
|
|
|
420,847
|
|
||
Cost of goods sold
|
493,816
|
|
|
422,605
|
|
||
Gross profit (loss)
|
94,095
|
|
|
(1,758
|
)
|
||
Other operating expense – net
|
2,079
|
|
|
2,414
|
|
||
Selling, general and administrative expenses
|
11,971
|
|
|
10,062
|
|
||
Operating income (loss)
|
80,045
|
|
|
(14,234
|
)
|
||
Interest expense
|
(5,551
|
)
|
|
(5,477
|
)
|
||
Interest income
|
142
|
|
|
140
|
|
||
Net gain (loss) on forward and derivative contracts
|
353
|
|
|
(879
|
)
|
||
Unrealized gain on fair value of contingent consideration
|
6,527
|
|
|
—
|
|
||
Other income (expense) – net
|
1,054
|
|
|
(253
|
)
|
||
Income (loss) before income taxes and equity in earnings (losses) of joint ventures
|
82,570
|
|
|
(20,703
|
)
|
||
Income tax benefit (expense)
|
(9,301
|
)
|
|
1,094
|
|
||
Income (loss) before equity in earnings (losses) of joint ventures
|
73,269
|
|
|
(19,609
|
)
|
||
Equity in earnings (losses) of joint ventures
|
510
|
|
|
(495
|
)
|
||
Net income (loss)
|
$
|
73,779
|
|
|
$
|
(20,104
|
)
|
|
|
|
|
||||
Net income (loss) allocated to common stockholders
|
$
|
67,813
|
|
|
$
|
(20,104
|
)
|
EARNINGS (LOSS) PER COMMON SHARE:
|
|
|
|
||||
Basic and Diluted
|
$
|
0.76
|
|
|
$
|
(0.23
|
)
|
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
|
|
|
|
||||
Basic
|
88,814
|
|
|
88,717
|
|
||
Diluted
|
89,369
|
|
|
88,717
|
|
CENTURY ALUMINUM COMPANY
|
|
|||||||
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
|
|
|||||||
(in thousands)
|
|
|||||||
(Unaudited)
|
|
|||||||
|
Three months ended March 31,
|
|
||||||
|
2015
|
|
2014
|
|
||||
Comprehensive income (loss):
|
|
|
|
|
||||
Net income (loss)
|
$
|
73,779
|
|
|
$
|
(20,104
|
)
|
|
Other comprehensive income before income tax effect:
|
|
|
|
|
||||
Net gain on foreign currency cash flow hedges reclassified as income
|
(47
|
)
|
|
(47
|
)
|
|
||
Defined benefit plans and other postretirement benefits:
|
|
|
|
|
||||
Amortization of prior service benefit during the period
|
(936
|
)
|
|
(952
|
)
|
|
||
Amortization of net loss during the period
|
1,444
|
|
|
1,811
|
|
|
||
Other comprehensive income before income tax effect
|
461
|
|
|
812
|
|
|
||
Income tax effect
|
(383
|
)
|
|
(713
|
)
|
|
||
Other comprehensive income
|
78
|
|
|
99
|
|
|
||
Total comprehensive income (loss)
|
$
|
73,857
|
|
|
$
|
(20,005
|
)
|
|
CENTURY ALUMINUM COMPANY
|
|||||||
CONSOLIDATED BALANCE SHEETS
|
|||||||
(in thousands, except share amounts)
|
|||||||
(Unaudited)
|
|||||||
|
March 31, 2015
|
|
December 31, 2014
|
||||
ASSETS
|
|||||||
Cash and cash equivalents
|
$
|
226,431
|
|
|
$
|
163,242
|
|
Restricted cash
|
21,813
|
|
|
801
|
|
||
Accounts receivable — net
|
3,464
|
|
|
76,165
|
|
||
Due from affiliates
|
85,062
|
|
|
31,503
|
|
||
Inventories
|
297,814
|
|
|
283,480
|
|
||
Prepaid and other current assets
|
23,809
|
|
|
29,768
|
|
||
Deferred taxes
|
14,281
|
|
|
14,281
|
|
||
Total current assets
|
672,674
|
|
|
599,240
|
|
||
Property, plant and equipment — net
|
1,285,845
|
|
|
1,291,218
|
|
||
Other assets
|
124,529
|
|
|
123,577
|
|
||
TOTAL
|
$
|
2,083,048
|
|
|
$
|
2,014,035
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|||||||
LIABILITIES:
|
|
|
|
||||
Accounts payable, trade
|
$
|
140,093
|
|
|
$
|
151,443
|
|
Due to affiliates
|
50,033
|
|
|
22,261
|
|
||
Accrued and other current liabilities
|
107,374
|
|
|
104,646
|
|
||
Accrued employee benefits costs
|
10,058
|
|
|
10,159
|
|
||
Industrial revenue bonds
|
7,815
|
|
|
7,815
|
|
||
Total current liabilities
|
315,373
|
|
|
296,324
|
|
||
Senior notes payable
|
246,983
|
|
|
246,888
|
|
||
Accrued pension benefits costs — less current portion
|
57,722
|
|
|
59,906
|
|
||
Accrued postretirement benefits costs — less current portion
|
153,586
|
|
|
152,894
|
|
||
Other liabilities
|
47,990
|
|
|
53,272
|
|
||
Deferred taxes
|
122,447
|
|
|
113,604
|
|
||
Total noncurrent liabilities
|
628,728
|
|
|
626,564
|
|
||
COMMITMENTS AND CONTINGENCIES (NOTE 11)
|
|
|
|
||||
SHAREHOLDERS’ EQUITY:
|
|
|
|
||||
Series A Preferred stock (one cent par value, 5,000,000 shares authorized; 160,000 issued and 78,061 outstanding at March 31, 2015; 160,000 issued and 78,141 outstanding at December 31, 2014)
|
1
|
|
|
1
|
|
||
Common stock (one cent par value, 195,000,000 shares authorized; 93,869,878 issued and 87,883,357 outstanding at March 31, 2015; 93,851,103 issued and 89,064,582 outstanding at December 31, 2014)
|
939
|
|
|
939
|
|
||
Additional paid-in capital
|
2,510,665
|
|
|
2,510,261
|
|
||
Treasury stock, at cost
|
(76,385
|
)
|
|
(49,924
|
)
|
||
Accumulated other comprehensive loss
|
(117,604
|
)
|
|
(117,682
|
)
|
||
Accumulated deficit
|
(1,178,669
|
)
|
|
(1,252,448
|
)
|
||
Total shareholders’ equity
|
1,138,947
|
|
|
1,091,147
|
|
||
TOTAL
|
$
|
2,083,048
|
|
|
$
|
2,014,035
|
|
CENTURY ALUMINUM COMPANY
|
|||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|||||||
(in thousands)
|
|||||||
(Unaudited)
|
|||||||
|
Three months ended March 31,
|
||||||
|
2015
|
|
2014
|
||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
||||
Net income (loss)
|
$
|
73,779
|
|
|
$
|
(20,104
|
)
|
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
|
|
|
|
||||
Unrealized gain on fair value of contingent consideration
|
(6,527
|
)
|
|
—
|
|
||
Unrealized gain on E.ON contingent obligation
|
(353
|
)
|
|
(353
|
)
|
||
Accrued and other plant curtailment costs — net
|
1,077
|
|
|
1,092
|
|
||
Lower of cost or market inventory adjustment
|
—
|
|
|
(1,107
|
)
|
||
Depreciation
|
18,131
|
|
|
17,768
|
|
||
Sebree power contract amortization
|
—
|
|
|
(5,534
|
)
|
||
Debt discount amortization
|
95
|
|
|
88
|
|
||
Pension and other postretirement benefits
|
(984
|
)
|
|
2,613
|
|
||
Deferred income taxes
|
8,851
|
|
|
512
|
|
||
Stock-based compensation
|
405
|
|
|
198
|
|
||
Equity in (earnings) losses of joint ventures, net of dividends
|
(510
|
)
|
|
495
|
|
||
Change in operating assets and liabilities:
|
|
|
|
||||
Accounts receivable — net
|
72,702
|
|
|
10,566
|
|
||
Due from affiliates
|
(53,559
|
)
|
|
(12,545
|
)
|
||
Inventories
|
(14,335
|
)
|
|
(11,377
|
)
|
||
Prepaid and other current assets
|
5,960
|
|
|
(2,958
|
)
|
||
Accounts payable, trade
|
(18,508
|
)
|
|
(3,825
|
)
|
||
Due to affiliates
|
27,773
|
|
|
20,798
|
|
||
Accrued and other current liabilities
|
2,874
|
|
|
(6,620
|
)
|
||
Other — net
|
(604
|
)
|
|
(448
|
)
|
||
Net cash provided by (used in) operating activities
|
116,267
|
|
|
(10,741
|
)
|
||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
||||
Purchase of property, plant and equipment
|
(10,960
|
)
|
|
(9,700
|
)
|
||
Nordural expansion — Helguvik
|
(73
|
)
|
|
(93
|
)
|
||
Purchase of carbon anode assets and improvements
|
(1,594
|
)
|
|
(5,724
|
)
|
||
Restricted and other cash deposits
|
(21,012
|
)
|
|
665
|
|
||
Net cash used in investing activities
|
(33,639
|
)
|
|
(14,852
|
)
|
||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
||||
Borrowings under revolving credit facilities
|
455
|
|
|
18,870
|
|
||
Repayments under revolving credit facilities
|
(455
|
)
|
|
(24,870
|
)
|
||
Repurchase of common stock
|
(19,439
|
)
|
|
—
|
|
||
Issuance of common stock
|
—
|
|
|
3
|
|
||
Net cash used in financing activities
|
(19,439
|
)
|
|
(5,997
|
)
|
||
CHANGE IN CASH AND CASH EQUIVALENTS
|
63,189
|
|
|
(31,590
|
)
|
||
Cash and cash equivalents, beginning of period
|
163,242
|
|
|
84,088
|
|
||
Cash and cash equivalents, end of period
|
$
|
226,431
|
|
|
$
|
52,498
|
|
1.
|
General
|
2.
|
Related party transactions
|
|
Three months ended March 31,
|
|||||
|
2015
|
2014
|
||||
Net sales to Glencore
|
$
|
575,729
|
|
$
|
285,583
|
|
Purchases from Glencore
|
107,814
|
|
63,857
|
|
||
Purchases from BHH
|
14,820
|
|
14,607
|
|
3.
|
Business acquisitions
|
|
As of December 1, 2014
|
||
Consideration:
|
|
||
Purchase price
|
$
|
67,500
|
|
Pension funding (1)
|
46,546
|
|
|
Contingent consideration
|
13,780
|
|
|
Economic, working capital and other closing adjustments (1)
|
(12,324
|
)
|
|
Settlement of partnership accounts
|
(23,172
|
)
|
|
Total consideration
|
$
|
92,330
|
|
(1)
|
While there were no additional acquisition-related payments in the first quarter of 2015, subsequent to the quarter end, we paid an additional payment of
$38,162
primarily related to pension funding obligations, final economic adjustment, working capital and other adjustments, net of certain amounts owed by Alumax to Mt. Holly.
|
|
Preliminary estimate of the acquisition date fair value as of December 1, 2014
|
||
Assets Acquired:
|
|
||
Inventories
|
$
|
26,105
|
|
Due from Alumax
|
20,786
|
|
|
Prepaid and other current assets
|
2,527
|
|
|
Intangible asset
|
2,580
|
|
|
Pension asset
|
30,842
|
|
|
Property, plant and equipment – net
|
127,089
|
|
|
Total assets acquired
|
$
|
209,929
|
|
Liabilities Assumed:
|
|
||
Accounts payable, trade
|
$
|
41,471
|
|
Accrued and other current liabilities
|
6,045
|
|
|
Accrued postretirement benefit costs
|
2,857
|
|
|
Asset retirement obligations
|
10,503
|
|
|
Deferred taxes
|
4,804
|
|
|
Total liabilities assumed
|
$
|
65,680
|
|
Goodwill
|
$
|
4,804
|
|
|
Three months ended March 31,
|
||
|
2014
|
||
Pro forma revenues
|
$
|
474,155
|
|
Pro forma earnings (loss) from continuing operations
|
(24,217
|
)
|
|
Pro forma earnings (loss) per common share, basic
|
(0.27
|
)
|
|
Pro forma earnings (loss) per common share, diluted
|
(0.27
|
)
|
Amounts Recognized Separately from the Acquisition:
|
Line item
|
Amount recognized
|
||
Alumina Supply Agreements
|
Inventory
|
$
|
14,880
|
|
4.
|
Fair value measurements
|
(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. The trust has sole authority to invest the funds in secure interest producing investments consisting of short-term securities issued or guaranteed by the United States government or cash and cash equivalents.
|
Recurring Fair Value Measurements
|
As of March 31, 2015
|
|||||||||||
|
Level 1
|
Level 2
|
Level 3
|
Total
|
||||||||
ASSETS:
|
|
|
|
|
||||||||
Cash equivalents
|
$
|
197,572
|
|
$
|
—
|
|
$
|
—
|
|
$
|
197,572
|
|
Trust assets
|
7,378
|
|
—
|
|
—
|
|
7,378
|
|
||||
Surety bonds
|
1,987
|
|
—
|
|
—
|
|
1,987
|
|
||||
TOTAL
|
$
|
206,937
|
|
$
|
—
|
|
$
|
—
|
|
$
|
206,937
|
|
LIABILITIES:
|
|
|
|
|
||||||||
E.ON contingent obligation – net (1)
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
TOTAL
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
Recurring Fair Value Measurements
|
As of December 31, 2014
|
|||||||||||
|
Level 1
|
Level 2
|
Level 3
|
Total
|
||||||||
ASSETS:
|
|
|
|
|
||||||||
Cash equivalents
|
$
|
137,712
|
|
$
|
—
|
|
$
|
—
|
|
$
|
137,712
|
|
Trust assets
|
8,067
|
|
—
|
|
—
|
|
8,067
|
|
||||
Surety bonds
|
1,987
|
|
—
|
|
—
|
|
1,987
|
|
||||
TOTAL
|
$
|
147,766
|
|
$
|
—
|
|
$
|
—
|
|
$
|
147,766
|
|
LIABILITIES:
|
|
|
|
|
||||||||
E.ON contingent obligation – net (1)
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
TOTAL
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
(1)
|
See
Note 10 Debt
for additional information about the E.ON contingent obligation.
|
|
|
5.
|
Derivative and hedging instruments
|
(1)
|
See
Note 10 Debt
for additional information about the E.ON contingent obligation.
|
|
For the three months ended March 31,
|
||||||||||||||||
|
2015
|
|
2014
|
||||||||||||||
|
Income
|
Shares (000)
|
Per-Share
|
|
Loss
|
Shares (000)
|
Per-Share
|
||||||||||
Net income (loss)
|
$
|
73,779
|
|
|
|
|
$
|
(20,104
|
)
|
|
|
||||||
Amount allocated to common stockholders (1)
|
91.91
|
%
|
|
|
|
100
|
%
|
|
|
||||||||
Basic EPS:
|
|
|
|
|
|
|
|
||||||||||
Net income (loss) allocated to common stockholders
|
67,813
|
|
88,814
|
|
$
|
0.76
|
|
|
(20,104
|
)
|
88,717
|
|
$
|
(0.23
|
)
|
||
Effect of Dilutive Securities:
|
|
|
|
|
|
|
|
||||||||||
Share-based compensation plans
|
—
|
|
555
|
|
|
|
—
|
|
—
|
|
|
||||||
Diluted EPS:
|
|
|
|
|
|
|
|
||||||||||
Net income (loss) allocated to common stockholders with assumed conversion
|
$
|
67,813
|
|
89,369
|
|
$
|
0.76
|
|
|
$
|
(20,104
|
)
|
88,717
|
|
$
|
(0.23
|
)
|
(1)
|
We have not allocated net losses between common and preferred stockholders, as the holders of our preferred shares do not have a contractual obligation to share in the loss.
|
Securities excluded from the calculation of diluted EPS:
|
Three months ended March 31,
|
|||
|
2015
|
2014
|
||
|
|
|
||
Stock options (1)
|
333,266
|
|
603,032
|
|
Service-based share awards (1)
|
—
|
|
442,456
|
|
(1)
|
In periods when we report a net loss, all share awards are excluded from the calculation of diluted weighted average shares outstanding because of their antidilutive effect on earnings (loss) per share. In periods when we report net income, certain option awards may be excluded from the calculation of diluted EPS if the exercise price of the option award was greater than the average market price of the underlying common stock.
|
7.
|
Shareholders’ equity
|
Common and Preferred Stock Activity:
|
Preferred stock
|
|
Common stock
|
||||
(in shares)
|
Series A convertible
|
|
Treasury
|
Outstanding
|
|||
Beginning balance as of December 31, 2014
|
78,141
|
|
|
4,786,521
|
|
89,064,582
|
|
Repurchase of common stock
|
—
|
|
|
1,200,000
|
|
(1,200,000
|
)
|
Conversion of convertible preferred stock
|
(80
|
)
|
|
—
|
|
7,947
|
|
Issuance for share-based compensation plans
|
—
|
|
|
—
|
|
10,828
|
|
Ending balance as of March 31, 2015
|
78,061
|
|
|
5,986,521
|
|
87,883,357
|
|
|
|
|
|
|
|||
Beginning balance as of December 31, 2013
|
79,620
|
|
|
4,786,521
|
|
88,710,277
|
|
Conversion of convertible preferred stock
|
(255
|
)
|
|
—
|
|
25,542
|
|
Issuance for share-based compensation plans
|
—
|
|
|
—
|
|
35,624
|
|
Ending balance as of March 31, 2014
|
79,365
|
|
|
4,786,521
|
|
88,771,443
|
|
8.
|
Income taxes
|
9.
|
Inventories
|
Inventories consist of the following:
|
March 31, 2015
|
December 31, 2014
|
||||
Raw materials
|
$
|
98,993
|
|
$
|
78,599
|
|
Work-in-process
|
32,190
|
|
33,941
|
|
||
Finished goods
|
4,492
|
|
19,969
|
|
||
Operating and other supplies
|
162,139
|
|
150,971
|
|
||
Total inventories
|
$
|
297,814
|
|
$
|
283,480
|
|
10.
|
Debt
|
|
March 31, 2015
|
December 31, 2014
|
||||
Debt classified as current liabilities:
|
|
|
||||
Hancock County industrial revenue bonds ("IRBs") due 2028, interest payable quarterly (variable interest rates (not to exceed 12%)) (1)
|
$
|
7,815
|
|
$
|
7,815
|
|
Debt classified as non-current liabilities:
|
|
|
||||
7.5% senior secured notes due June 1, 2021, net of debt discount of $3,017 and $3,112, respectively, interest payable semiannually
|
246,983
|
|
246,888
|
|
||
Total
|
$
|
254,798
|
|
$
|
254,703
|
|
(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 IRB interest rate at
March 31, 2015
was
0.22%
.
|
|
March 31, 2015
|
||
Credit facility maximum amount
|
$
|
150,000
|
|
Borrowing availability, net of outstanding letters of credit
|
50,617
|
|
|
Outstanding borrowings
|
—
|
|
|
Letter of credit sub-facility amount (1)
|
100,000
|
|
|
Outstanding letters of credit issued
|
99,383
|
|
(1)
|
On December 1, 2014, we entered into an amendment to the U.S. revolving credit facility, increasing our letter of credit sub-facility to
$130,000
for the period from December 1, 2014 through March 1, 2015 and to
$100,000
thereafter.
|
|
March 31, 2015
|
||
Credit Facility maximum amount
|
$
|
50,000
|
|
Borrowing availability
|
50,000
|
|
|
Outstanding borrowings
|
—
|
|
Offsetting of financial instruments and derivatives
|
|
|
|
||||
|
Balance sheet location
|
March 31, 2015
|
December 31, 2014
|
||||
E.ON contingent obligation – principal
|
Other liabilities
|
$
|
(12,902
|
)
|
$
|
(12,902
|
)
|
E.ON contingent obligation – accrued interest
|
Other liabilities
|
(5,644
|
)
|
(5,291
|
)
|
||
E.ON contingent obligation – derivative asset
|
Other liabilities
|
18,546
|
|
18,193
|
|
||
|
|
$
|
—
|
|
$
|
—
|
|
11.
|
Commitments and contingencies
|
12.
|
Forward delivery contracts and financial instruments
|
Contract
|
Customer
|
Volume
|
Term
|
Pricing
|
Glencore Grundartangi Metal Agreement (1)
|
Glencore
|
All primary aluminum produced at Grundartangi, net of tolling and other sales commitments
|
January 1, 2014 through December 31, 2017
|
Variable, based on LME and European Duty Paid premium
|
Glencore U.S. Aluminum Sales Agreement
|
Glencore
|
All primary aluminum produced in North America
|
January 1, 2015 through December 31, 2016
|
Variable, based on LME and Midwest premium and product premiums, as applicable
|
(1)
|
The Glencore Grundartangi Metal Agreement is for all metal produced at Grundartangi from 2014 through 2017 less commitments under existing tolling and other sales contracts. Grundartangi currently estimates that it will sell Glencore approximately
205,000
tonnes of aluminum under this agreement in 2015.
|
Contract
|
Customer
|
Volume
|
Term
|
Pricing
|
Glencore Toll Agreement
|
Glencore
|
90,000 tonnes per year ("tpy")
|
Through July 2016
|
Variable, based on LME and European Duty Paid premium
|
|
March 31, 2015
|
December 31, 2014
|
||
|
(in tonnes)
|
|||
Other forward delivery contracts – total
|
221
|
|
6,108
|
|
Other forward delivery contracts – Glencore
|
—
|
|
4,058
|
|
13.
|
Supplemental cash flow information
|
|
Three months ended March 31,
|
|||||
|
2015
|
2014
|
||||
Cash paid for:
|
|
|
||||
Interest
|
$
|
5
|
|
$
|
131
|
|
Income/withholding taxes (1)
|
1,142
|
|
1,846
|
|
||
Non-cash investing activities:
|
|
|
||||
Accrued capital costs
|
$
|
1,202
|
|
$
|
4,619
|
|
(1)
|
Our tax payments in Iceland for withholding taxes, income taxes and any associated refunds are denominated in Icelandic kronur ("ISK").
|
14.
|
Asset retirement obligations ("ARO")
|
|
Three months ended March 31, 2015
|
Year ended December 31, 2014
|
||||
Beginning balance, ARO liability
|
$
|
36,950
|
|
$
|
27,113
|
|
Additional ARO liability incurred
|
1,476
|
|
2,548
|
|
||
ARO liabilities settled
|
(1,298
|
)
|
(4,731
|
)
|
||
Accretion expense
|
74
|
|
1,517
|
|
||
ARO liability from Mt. Holly acquisition
|
—
|
|
10,503
|
|
||
Ending balance, ARO liability
|
$
|
37,202
|
|
$
|
36,950
|
|
|
March 31, 2015
|
December 31, 2014
|
||||
Defined benefit plan liabilities
|
$
|
(128,156
|
)
|
$
|
(128,664
|
)
|
Unrealized loss on financial instruments
|
(1,296
|
)
|
(1,249
|
)
|
||
Other comprehensive loss before income tax effect
|
(129,452
|
)
|
(129,913
|
)
|
||
Income tax effect (1)
|
11,848
|
|
12,231
|
|
||
Accumulated other comprehensive loss
|
$
|
(117,604
|
)
|
$
|
(117,682
|
)
|
|
March 31, 2015
|
December 31, 2014
|
||||
Defined benefit plan liabilities
|
$
|
12,421
|
|
$
|
12,812
|
|
Unrealized loss on financial instruments
|
(573
|
)
|
(581
|
)
|
|
Defined benefit plan and other postretirement liabilities
|
Equity in investee other comprehensive income
|
Unrealized loss on financial instruments
|
Total, net of tax
|
||||||||
Balance, December 31, 2014
|
$
|
(115,852
|
)
|
$
|
—
|
|
$
|
(1,830
|
)
|
$
|
(117,682
|
)
|
Net amount reclassified to net income
|
117
|
|
—
|
|
(39
|
)
|
78
|
|
||||
Balance, March 31, 2015
|
$
|
(115,735
|
)
|
$
|
—
|
|
$
|
(1,869
|
)
|
$
|
(117,604
|
)
|
|
|
|
|
|
||||||||
Balance, December 31, 2013
|
$
|
(77,921
|
)
|
$
|
(12,232
|
)
|
$
|
(1,679
|
)
|
$
|
(91,832
|
)
|
Other comprehensive loss before reclassifications
|
—
|
|
(17
|
)
|
—
|
|
(17
|
)
|
||||
Net amount reclassified to net loss
|
155
|
|
—
|
|
(39
|
)
|
116
|
|
||||
Balance, March 31, 2014
|
$
|
(77,766
|
)
|
$
|
(12,249
|
)
|
$
|
(1,718
|
)
|
$
|
(91,733
|
)
|
|
|
For the three months ended March 31,
|
|||||
AOCI Components
|
Location
|
2015
|
2014
|
||||
Defined benefit plan and other postretirement liabilities
|
Cost of goods sold
|
$
|
325
|
|
$
|
590
|
|
|
Selling, general and administrative expenses
|
183
|
|
268
|
|
||
|
Income tax expense
|
(391
|
)
|
(703
|
)
|
||
|
Net of tax
|
$
|
117
|
|
$
|
155
|
|
|
|
|
|
||||
Equity in investee other comprehensive income
|
Income tax expense
|
$
|
—
|
|
$
|
(17
|
)
|
|
Net of tax
|
$
|
—
|
|
$
|
(17
|
)
|
|
|
|
|
||||
Unrealized loss on financial instruments
|
Cost of goods sold
|
$
|
(47
|
)
|
$
|
(47
|
)
|
|
Income tax expense
|
8
|
|
8
|
|
||
|
Net of tax
|
$
|
(39
|
)
|
$
|
(39
|
)
|
16.
|
Components of net periodic benefit cost
|
|
Pension Benefits
|
|||||
|
Three months ended March 31,
|
|||||
|
2015
|
2014
|
||||
Service cost
|
$
|
1,704
|
|
$
|
1,587
|
|
Interest cost
|
3,388
|
|
2,640
|
|
||
Expected return on plan assets
|
(5,494
|
)
|
(3,397
|
)
|
||
Amortization of prior service costs
|
25
|
|
9
|
|
||
Amortization of net loss
|
620
|
|
787
|
|
||
Net periodic benefit cost
|
$
|
243
|
|
$
|
1,626
|
|
|
Other Postretirement Benefits ("OPEB")
|
|||||
|
Three months ended March 31,
|
|||||
|
2015
|
2014
|
||||
Service cost
|
$
|
562
|
|
$
|
677
|
|
Interest cost
|
1,591
|
|
1,511
|
|
||
Amortization of prior service cost
|
(961
|
)
|
(961
|
)
|
||
Amortization of net loss
|
865
|
|
1,024
|
|
||
Net periodic benefit cost
|
$
|
2,057
|
|
$
|
2,251
|
|
17.
|
Restricted cash
|
18.
|
Subsequent events
|
•
|
Future global and local financial and economic conditions;
|
•
|
Our assessment of the aluminum market and aluminum prices (including premiums);
|
•
|
The future financial and operating performance of the Company, its subsidiaries and its projects;
|
•
|
Future earnings, operating results and liquidity;
|
•
|
Future inventory, production, sales, cash costs and capital expenditures;
|
•
|
Our business objectives, strategies and initiatives, the growth of our business (including with respect to production and production capacity) and our competitive position and prospects;
|
•
|
Our ability to procure alumina, carbon products and other raw materials and our assessment of pricing and costs and other terms relating thereto;
|
•
|
Access to existing or future financing arrangements;
|
•
|
Our ability to repay debt in the future, including the E.ON contingent obligation;
|
•
|
Estimates of our pension and other postretirement liabilities and future payments, property plant and equipment impairment, environmental liabilities and other contingent liabilities and contractual commitments;
|
•
|
Our ability to successfully manage transmission issues and wholesale market power price risk and to control or reduce power costs;
|
•
|
Our assessment of power pricing and our ability to successfully obtain and/or implement long-term competitive power arrangements for our operations and projects, including at Mt. Holly and Ravenswood;
|
•
|
Negotiations with labor unions representing our employees at Hawesville;
|
•
|
Our ability to successfully produce value-added products at our smelters;
|
•
|
Future construction investment and development, including the Helguvik Project, the restart of the second baking furnace at Vlissingen project and our expansion project at Grundartangi, including our ability to secure sufficient amounts of power, future capital expenditures, the costs of completion or cancellation, timing, production capacity and sources of funding;
|
•
|
Our ability to derive benefits from acquisitions, including the acquisition of Mt. Holly and Sebree smelters, and to successfully integrate these operations with the rest of our business;
|
•
|
Our ability to realize the potential benefits to be provided to Grundartangi and our planned Helguvik smelter from the purchase by Century Vlissingen of carbon anode production assets in the Netherlands;
|
•
|
Our plans with respect to restarting operations at our Ravenswood, West Virginia smelter, and potential curtailment of other domestic assets;
|
•
|
The anticipated impact of recent accounting pronouncements or changes in accounting principles;
|
•
|
Our anticipated tax liabilities, benefits or refunds including the realization of U.S. and certain foreign deferred tax assets;
|
•
|
Our assessment of the ultimate outcome of outstanding litigation and environmental matters and liabilities relating thereto; and
|
•
|
The effect of future laws and regulations.
|
|
Three months ended March 31,
|
|||||
|
2015
|
2014
|
||||
|
(In thousands, except per share data)
|
|||||
NET SALES:
|
|
|
||||
Related parties
|
$
|
575,729
|
|
$
|
285,583
|
|
Third-party customers
|
12,182
|
|
135,264
|
|
||
Total net sales
|
$
|
587,911
|
|
$
|
420,847
|
|
Gross profit (loss)
|
$
|
94,095
|
|
$
|
(1,758
|
)
|
Net income (loss)
|
$
|
73,779
|
|
$
|
(20,104
|
)
|
EARNINGS (LOSS) PER COMMON SHARE:
|
|
|
||||
Basic and Diluted
|
$
|
0.76
|
|
$
|
(0.23
|
)
|
SHIPMENTS - PRIMARY ALUMINUM
|
|
|
|
|
||||||||||||||||
|
|
|
|
|
|
|||||||||||||||
|
Direct (1)
|
|
Toll
|
|||||||||||||||||
|
United States
|
|
Iceland
|
|
Iceland
|
|||||||||||||||
|
Tonnes
|
|
Sales $ (000)
|
|
Tonnes
|
|
Sales $ (000)
|
|
Tonnes
|
|
Sales $ (000)
|
|||||||||
2015
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
1st Quarter
|
169,306
|
|
|
$
|
421,141
|
|
|
45,967
|
|
|
$
|
112,662
|
|
|
29,985
|
|
|
$
|
46,617
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
1st Quarter
|
136,532
|
|
|
$
|
296,889
|
|
|
36,764
|
|
|
$
|
74,370
|
|
|
33,489
|
|
|
$
|
47,185
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Excludes scrap aluminum sales.
|
Net sales (in millions)
|
2015
|
2014
|
$ Difference
|
% Difference
|
|||||||
Three months ended March 31,
|
$
|
587.9
|
|
$
|
420.8
|
|
$
|
167.1
|
|
39.7
|
%
|
Gross profit (loss) (in millions)
|
2015
|
2014
|
$ Difference
|
% Difference
|
|||||||
Three months ended March 31,
|
$
|
94.1
|
|
$
|
(1.8
|
)
|
$
|
95.9
|
|
5,327.8
|
%
|
Selling, general and administrative expenses (in millions)
|
2015
|
2014
|
$ Difference
|
% Difference
|
|||||||
Three months ended March 31,
|
$
|
12.0
|
|
$
|
10.1
|
|
$
|
1.9
|
|
18.8
|
%
|
Unrealized gain on fair value of contingent consideration (in millions)
|
2015
|
2014
|
$ Difference
|
% Difference
|
||||||
Three months ended March 31,
|
$
|
6.5
|
|
$
|
—
|
|
$
|
6.5
|
|
N/A
|
Income tax benefit (expense) (in millions)
|
2015
|
2014
|
$ Difference
|
% Difference
|
|||||||
Three months ended March 31,
|
$
|
(9.3
|
)
|
$
|
1.1
|
|
$
|
(10.4
|
)
|
(945.5
|
)%
|
|
Three months ended March 31,
|
|||||
|
2015
|
2014
|
||||
|
|
|
||||
Operating income (loss)
|
$
|
80,045
|
|
$
|
(14,234
|
)
|
Depreciation
|
18,131
|
|
17,768
|
|
||
Sebree power contract amortization
|
—
|
|
(5,534
|
)
|
||
Non-cash inventory adjustment
|
—
|
|
(1,107
|
)
|
||
Separation of former senior executives
|
1,000
|
|
—
|
|
||
Signing bonuses - labor negotiations
|
1,570
|
|
—
|
|
||
Litigation items
|
—
|
|
3,100
|
|
||
Adjusted EBITDA
|
$
|
100,746
|
|
$
|
(7
|
)
|
|
Three months ended March 31,
|
|||||
|
2015
|
2014
|
||||
|
(in thousands)
|
|||||
Net cash provided by (used in) operating activities
|
$
|
116,267
|
|
$
|
(10,741
|
)
|
Net cash used in investing activities
|
(33,639
|
)
|
(14,852
|
)
|
||
Net cash used in financing activities
|
(19,439
|
)
|
(5,997
|
)
|
||
Change in cash and cash equivalents
|
$
|
63,189
|
|
$
|
(31,590
|
)
|
|
March 31, 2015
|
December 31, 2014
|
||
|
(in tonnes)
|
|||
Other forward delivery contracts – total
|
221
|
|
6,108
|
|
Other forward delivery contracts – Glencore
|
—
|
|
4,058
|
|
Period
|
Total Number of Shares Purchased
|
Average Price Paid per Share
|
Total Number of Shares Purchased as Part of Publicly Announced Programs
|
Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program (1)
|
||||||
January 1 through January 31
|
—
|
|
$
|
—
|
|
—
|
|
$
|
10,076,076
|
|
February 1 through February 28
|
—
|
|
—
|
|
—
|
|
30,076,076
|
|
||
March 1 through March 31
|
1,200,000
|
|
16.20
|
|
1,200,000
|
|
60,636,616
|
|
||
Total for quarter ended March 31, 2015
|
1,200,000
|
|
$
|
16.20
|
|
1,200,000
|
|
$
|
60,636,616
|
|
(1)
|
In August 2011, our Board of Directors approved a $60 million common stock repurchase program. In the first quarter of 2015, our Board expanded the repurchase program by approving an additional $70 million. Under the expanded program, Century is authorized to repurchase up to $130 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.
|
Exhibit Number
|
Description of Exhibit
|
Incorporated by Reference
|
Filed Herewith
|
||
Form
|
File No.
|
Filing Date
|
|||
10.1*
|
Amended and Restated Aluminum Purchase Agreement, dated as of February 23, 2015, by and between Century Aluminum Company, NSA General Partnership, Century Aluminum Sebree LLC, Century Aluminum of South Carolina, Inc., Century Aluminum of West Virginia, Inc. and Glencore Ltd.
|
|
|
|
X
|
31.1
|
Rule 13a-14(a)/15d-14(a) Certification of the Chief Executive Officer
|
|
|
|
X
|
31.2
|
Rule 13a-14(a)/15d-14(a) Certification of the Chief Financial Officer
|
|
|
|
X
|
32.1**
|
Section 1350 Certification (pursuant to Sarbanes-Oxley Section 906) by Chief Executive Officer
|
|
|
|
X
|
32.2**
|
Section 1350 Certification (pursuant to Sarbanes-Oxley Section 906) by Chief Financial Officer
|
|
|
|
X
|
101.INS***
|
XBRL Instance Document
|
|
|
|
X
|
101.SCH***
|
XBRL Taxonomy Extension Schema
|
|
|
|
X
|
101.CAL***
|
XBRL Taxonomy Extension Calculation Linkbase
|
|
|
|
X
|
101.DEF***
|
XBRL Taxonomy Extension Definition Linkbase
|
|
|
|
X
|
101.LAB***
|
XBRL Taxonomy Extension Label Linkbase
|
|
|
|
X
|
101.PRE***
|
XBRL Taxonomy Extension Presentation Linkbase
|
|
|
|
X
|
|
|
|
|
Century Aluminum Company
|
|
|
|
|
|
Date:
|
April 30, 2015
|
|
By:
|
/s/ MICHAEL A. BLESS
|
|
|
|
|
Michael A. Bless
|
|
|
|
|
President and Chief Executive Officer
(Principal Executive Officer)
|
|
|
|
|
|
Date:
|
April 30, 2015
|
|
By:
|
/s/ RICK T. DILLON
|
|
|
|
|
Rick T. Dillon
|
|
|
|
|
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
|
Exhibit Number
|
Description of Exhibit
|
Incorporated by Reference
|
Filed Herewith
|
||
Form
|
File No.
|
Filing Date
|
|||
10.1*
|
Amended and Restated Aluminum Purchase Agreement, dated as of February 23, 2015, by and between Century Aluminum Company, NSA General Partnership, Century Aluminum Sebree LLC, Century Aluminum of South Carolina, Inc., Century Aluminum of West Virginia, Inc. and Glencore Ltd.
|
|
|
|
X
|
31.1
|
Rule 13a-14(a)/15d-14(a) Certification of the Chief Executive Officer
|
|
|
|
X
|
31.2
|
Rule 13a-14(a)/15d-14(a) Certification of the Chief Financial Officer
|
|
|
|
X
|
32.1**
|
Section 1350 Certification (pursuant to Sarbanes-Oxley Section 906) by Chief Executive Officer
|
|
|
|
X
|
32.2**
|
Section 1350 Certification (pursuant to Sarbanes-Oxley Section 906) by Chief Financial Officer
|
|
|
|
X
|
101.INS***
|
XBRL Instance Document
|
|
|
|
X
|
101.SCH***
|
XBRL Taxonomy Extension Schema
|
|
|
|
X
|
101.CAL***
|
XBRL Taxonomy Extension Calculation Linkbase
|
|
|
|
X
|
101.DEF***
|
XBRL Taxonomy Extension Definition Linkbase
|
|
|
|
X
|
101.LAB***
|
XBRL Taxonomy Extension Label Linkbase
|
|
|
|
X
|
101.PRE***
|
XBRL Taxonomy Extension Presentation Linkbase
|
|
|
|
X
|
If to Glencore:
|
Glencore Ltd.
|
Email:
|
patrick.wilson@glencore-us.com
sylvia.malone@glencore-us.com matthew.douglas@glencore-us.com |
1)
|
I have reviewed this
quarterly
report on Form
10-Q
of Century Aluminum Company;
|
2)
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3)
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4)
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5)
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date:
|
April 30, 2015
|
|
|
|
/s/ MICHAEL A. BLESS
|
|
|
Name: Michael A. Bless
|
|
|
Title: President and Chief Executive Officer
(Principal Executive Officer)
|
1)
|
I have reviewed this
quarterly
report on Form
10-Q
of Century Aluminum Company;
|
2)
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3)
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4)
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5)
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date:
|
April 30, 2015
|
|
|
|
/s/ RICK T. DILLON
|
|
|
Name: Rick T. Dillon
|
|
|
Title: Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
|
1.
|
This Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in this Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
/s/ MICHAEL A. BLESS
|
|
By:
|
Michael A. Bless
|
|
Title:
|
President and Chief Executive Officer (Principal Executive Officer)
|
|
Date:
|
April 30, 2015
|
|
1.
|
This Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in this Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
/s/ RICK T. DILLON
|
|
By:
|
Rick T. Dillon
|
|
Title:
|
Executive Vice President and Chief Financial Officer (Principal Financial Officer)
|
|
Date:
|
April 30, 2015
|
|