Derivative Financial Instruments and Related Hedging Programs (Tables)

3 Months Ended

Mar. 31, 2014

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Summary of realized and unrealized gains and losses

Realized and unrealized gains (losses) associated with all derivative contracts consisted of the following, for each period presented:

	Quarter Ended
	March 31,
	2014			2013
Realized gains (losses):
Aluminum	$	0.8		$	—
Natural Gas	0.7			(0.7		)
Electricity	0.5			—
Total realized gains (losses)	$	2.0		$	(0.7	)
Unrealized gains (losses):
Aluminum	$	1.7		$	(4.4	)
Natural Gas	0.8			2.7
Electricity	(0.5		)	1.2
Foreign Currency	—			(0.2		)
Call Options relating to the Convertible Notes	4.4			6.0
Bifurcated Conversion Feature of the Convertible Notes	(3.5		)	(5.6		)
Total unrealized gains (losses)	$	2.9		$	(0.3	)

Summary of material derivative positions

The following table summarizes the Company’s material derivative positions at March 31, 2014:

Aluminum	Maturity Period (month/year)	Notional Amount of contracts (mmlbs)
Fixed priced purchase contracts	4/14 through 12/15	54.0
Fixed priced sales contracts	6/14 through 11/14	0.4
Midwest premium swap contracts1	4/14 through 12/15	52.4

Natural Gas2	Maturity Period (month/year)	Notional Amount of contracts (mmbtu)
Fixed priced purchase contracts	4/14 through 12/16	6,120,000

Electricity	Maturity Period (month/year)	Notional Amount of contracts (Mwh)
Fixed priced purchase contracts	4/14 through 12/15	340,225

Foreign Currency	Maturity Period (month/year)	Notional Amount of contracts (as shown)
GBP —
Fixed priced purchase contracts	4/14 through 5/14	£	44,106

Hedges Relating to the Convertible Notes	Contract Period (month/year)	Notional Amount of contracts (Common Shares)
Bifurcated Conversion Feature3	3/10 through 3/15	3,644,095
Call Options3	3/10 through 3/15	3,644,095

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¹  Regional premiums represent the premium over the London Metal Exchange price for primary aluminum which is incurred on the Company’s purchases of primary aluminum.

²  As of March 31, 2014, the Company’s exposure to fluctuations in natural gas prices had been substantially reduced for approximately 89%, 73% and 18% of the expected natural gas purchases for the remainder of 2014, 2015 and 2016, respectively.

³  The Bifurcated Conversion Feature represents the cash conversion feature of the Convertible Notes. The Call Options expire on the maturity or earlier conversion of the Convertible Notes and have an exercise price equal to the conversion price of the Convertible Notes, subject to anti-dilution adjustments substantially similar to the anti-dilution adjustments for the Convertible Notes. Although the fair value of the Call Options is derived from a notional number of shares of the Company’s common stock, the Call Options may only be settled in cash.

Summary of offsetting derivative instruments by counterparty

The following tables present offsetting information regarding the Company’s derivatives by type of counterparty as of March 31, 2014:

Derivative Assets and Collateral Held by Counterparty
							Gross Amounts Not Offset in the Consolidated Balance Sheets
	Gross Amounts of Recognized Assets		Gross Amounts Offset in the Consolidated Balance Sheets		Net Amounts of Assets Presented in the Consolidated Balance Sheets		Financial Instruments		Cash Collateral Received		Net Amount
Counterparty (with Netting Agreements)	$	1.4	$	—	$	1.4	$	1.2	$	—	$	0.2
Counterparty (without Netting Agreements)1	85.7		—		85.7		—		—		85.7
Counterparty (with partial Netting Agreements)	1.2		—		1.2		0.6		—		0.6
Total	$	88.3	$	—	$	88.3	$	1.8	$	—	$	86.5

Derivative Liabilities and Collateral Held by Counterparty
									Gross Amounts Not Offset in the Consolidated Balance Sheets
	Gross Amounts of Recognized Liabilities			Gross Amounts Offset in the Consolidated Balance Sheets		Net Amounts of Liabilities Presented in the Consolidated Balance Sheets			Financial Instruments			Cash Collateral Pledged		Net Amount
Counterparty (with Netting Agreements)	$	(1.9	)	$	—	$	(1.9	)	$	(1.2	)	$	—	$	(0.7	)
Counterparty (without Netting Agreements)1	(86.9		)	—		(86.9		)	—			—		(86.9		)
Counterparty (with partial Netting Agreements)	(0.9		)	—		(0.9		)	(0.6		)	—		(0.3		)
Total	$	(89.7	)	$	—	$	(89.7	)	$	(1.8	)	$	—	$	(87.9	)

_________________

¹  Such amounts include the fair value of the Bifurcated Conversion Feature and Call Options at March 31, 2014 (see Note 9).

The following tables present offsetting information regarding the Company’s derivatives by type of counterparty as of December 31, 2013:

Derivative Assets and Collateral Held by Counterparty
							Gross Amounts Not Offset in the Consolidated Balance Sheets
	Gross Amounts of Recognized Assets		Gross Amounts Offset in the Consolidated Balance Sheets		Net Amounts of Assets Presented in the Consolidated Balance Sheets		Financial Instruments		Cash Collateral Received		Net Amount
Counterparty (with Netting Agreements)	$	1.0	$	—	$	1.0	$	0.8	$	—	$	0.2
Counterparty (without Netting Agreements)1	80.4		—		80.4		—		—		80.4
Counterparty (with partial Netting Agreements)	0.4		—		0.4		0.4		—		—
Total	$	81.8	$	—	$	81.8	$	1.2	$	—	$	80.6

Derivative Liabilities and Collateral Held by Counterparty
									Gross Amounts Not Offset in the Consolidated Balance Sheets
	Gross Amounts of Recognized Liabilities			Gross Amounts Offset in the Consolidated Balance Sheets		Net Amounts of Liabilities Presented in the Consolidated Balance Sheets			Financial Instruments			Cash Collateral Pledged		Net Amount
Counterparty (with Netting Agreements)	$	(1.6	)	$	—	$	(1.6	)	$	(0.8	)	$	—	$	(0.8	)
Counterparty (without Netting Agreements)1	(83.2		)	—		(83.2		)	—			—		(83.2		)
Counterparty (with partial Netting Agreements)	(1.3		)	—		(1.3		)	(0.4		)	—		(0.9		)
Total	$	(86.1	)	$	—	$	(86.1	)	$	(1.2	)	$	—	$	(84.9	)

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¹  Such amounts include the fair value of the Bifurcated Conversion Feature and Call Options at December 31, 2013 (see Note 9).