Delaware (State or other jurisdiction of incorporation or organization) | 13-3070826 (IRS Employer Identification No.) |
One South Wacker Drive Suite 1000 Chicago, Illinois (Address of principal executive offices) | 60606 (Zip Code) |
Large accelerated filer | x | Accelerated filer | o |
Non-accelerated filer | o | Smaller reporting company | o |
Emerging growth company | o |
Title of each class: | Trading Symbol(s) | Name of each exchange on which registered: |
Common Stock, $0.01 par value per share | CENX | Nasdaq Stock Market LLC |
(Nasdaq Global Select Market) |
TABLE OF CONTENTS | |
Page | |
CENTURY ALUMINUM COMPANY | |||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||
(in millions, except per share amounts) | |||||||
(Unaudited) | |||||||
Three months ended March 31, | |||||||
2019 | 2018 | ||||||
NET SALES: | |||||||
Related parties | $ | 311.3 | $ | 296.2 | |||
Other customers | 178.7 | 158.3 | |||||
Total net sales | 490.0 | 454.5 | |||||
Cost of goods sold | 502.8 | 440.0 | |||||
Gross profit (loss) | (12.8 | ) | 14.5 | ||||
Selling, general and administrative expenses | 14.7 | 10.7 | |||||
Other operating (income) expense - net | 0.3 | 0.3 | |||||
Operating income (loss) | (27.8 | ) | 3.5 | ||||
Interest expense | (5.8 | ) | (5.5 | ) | |||
Interest income | 0.2 | 0.5 | |||||
Net gain (loss) on forward and derivative contracts | (5.7 | ) | 0.7 | ||||
Other income (expense) - net | 1.1 | (1.1 | ) | ||||
Income (loss) before income taxes and equity in earnings of joint ventures | (38.0 | ) | (1.9 | ) | |||
Income tax benefit (expense) | 2.9 | 1.0 | |||||
Income (loss) before equity in earnings of joint ventures | (35.1 | ) | (0.9 | ) | |||
Equity in earnings of joint ventures | 0.5 | 0.6 | |||||
Net income (loss) | $ | (34.6 | ) | $ | (0.3 | ) | |
Net income (loss) allocated to common stockholders | $ | (34.6 | ) | $ | (0.3 | ) | |
EARNINGS (LOSS) PER COMMON SHARE: | |||||||
Basic and diluted | $ | (0.39 | ) | $ | 0.00 | ||
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: | |||||||
Basic and diluted | 88.1 | 87.6 |
CENTURY ALUMINUM COMPANY | |||||||||
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | |||||||||
(in millions) | |||||||||
(Unaudited) | |||||||||
Three months ended March 31, | |||||||||
2019 | 2018 | ||||||||
Comprehensive income (loss): | |||||||||
Net income (loss) | $ | (34.6 | ) | $ | (0.3 | ) | |||
Other comprehensive income before income tax effect: | |||||||||
Net loss on foreign currency cash flow hedges reclassified as income | (0.0) | (0.0) | |||||||
Defined benefit plans and other postretirement benefits: | |||||||||
Amortization of prior service benefit during the period | (1.3 | ) | (1.8 | ) | |||||
Amortization of net loss during the period | 1.9 | 2.6 | |||||||
Other comprehensive income before income tax effect | 0.6 | 0.8 | |||||||
Income tax effect | (0.3 | ) | (0.4 | ) | |||||
Other comprehensive income | 0.3 | 0.4 | |||||||
Total comprehensive income (loss) | $ | (34.3 | ) | $ | 0.1 |
CENTURY ALUMINUM COMPANY | |||||||
CONSOLIDATED BALANCE SHEETS | |||||||
(in millions) | |||||||
(Unaudited) | |||||||
March 31, 2019 | December 31, 2018 | ||||||
ASSETS | |||||||
Cash and cash equivalents | $ | 22.2 | $ | 38.9 | |||
Restricted cash | 0.8 | 0.8 | |||||
Accounts receivable - net | 90.9 | 82.5 | |||||
Due from affiliates | 23.8 | 22.7 | |||||
Inventories | 327.4 | 343.8 | |||||
Prepaid and other current assets | 18.2 | 18.0 | |||||
Total current assets | 483.3 | 506.7 | |||||
Property, plant and equipment - net | 960.1 | 967.3 | |||||
Leases - right of use assets | 24.6 | — | |||||
Other assets | 62.4 | 63.5 | |||||
TOTAL | $ | 1,530.4 | $ | 1,537.5 | |||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||
LIABILITIES: | |||||||
Accounts payable, trade | $ | 113.2 | $ | 119.4 | |||
Due to affiliates | 3.1 | 10.3 | |||||
Accrued and other current liabilities | 59.2 | 52.5 | |||||
Accrued employee benefits costs | 11.0 | 11.0 | |||||
Revolving credit facility | 35.3 | 23.3 | |||||
Industrial revenue bonds | 7.8 | 7.8 | |||||
Total current liabilities | 229.6 | 224.3 | |||||
Senior notes payable | 248.8 | 248.6 | |||||
Accrued pension benefits costs - less current portion | 49.9 | 50.9 | |||||
Accrued postretirement benefits costs - less current portion | 100.7 | 101.2 | |||||
Other liabilities | 48.4 | 46.0 | |||||
Leases - right of use liabilities | 22.8 | — | |||||
Deferred taxes | 102.1 | 104.3 | |||||
Total noncurrent liabilities | 572.7 | 551.0 | |||||
COMMITMENTS AND CONTINGENCIES (NOTE 11) | |||||||
SHAREHOLDERS’ EQUITY: | |||||||
Preferred stock (Note 7) | 0.0 | 0.0 | |||||
Common stock (Note 7) | 1.0 | 1.0 | |||||
Additional paid-in capital | 2,523.3 | 2,523.0 | |||||
Treasury stock, at cost | (86.3 | ) | (86.3 | ) | |||
Accumulated other comprehensive loss | (99.7 | ) | (98.7 | ) | |||
Accumulated deficit | (1,610.2 | ) | (1,576.8 | ) | |||
Total shareholders’ equity | 728.1 | 762.2 | |||||
TOTAL | $ | 1,530.4 | $ | 1,537.5 |
CENTURY ALUMINUM COMPANY | |||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||
(in millions) | |||||||
(Unaudited) | |||||||
Three months ended March 31, | |||||||
2019 | 2018 | ||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||
Net income (loss) | $ | (34.6 | ) | $ | (0.3 | ) | |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||||||
Unrealized (gain) loss on derivative instruments | 5.6 | (0.4 | ) | ||||
Lower of cost or NRV inventory adjustment | — | (3.2 | ) | ||||
Depreciation and amortization | 24.3 | 21.5 | |||||
Other non-cash items - net | (4.5 | ) | (4.6 | ) | |||
Change in operating assets and liabilities: | |||||||
Accounts receivable - net | (8.4 | ) | (40.3 | ) | |||
Due from affiliates | (1.1 | ) | 1.7 | ||||
Inventories | 16.4 | (10.0 | ) | ||||
Prepaid and other current assets | 2.6 | 0.8 | |||||
Accounts payable, trade | (10.2 | ) | 5.4 | ||||
Due to affiliates | (7.2 | ) | (6.0 | ) | |||
Accrued and other current liabilities | (3.8 | ) | 6.2 | ||||
Other - net | (0.6 | ) | (3.8 | ) | |||
Net cash provided by (used in) operating activities | (21.5 | ) | (33.0 | ) | |||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||
Purchase of property, plant and equipment | (10.6 | ) | (3.5 | ) | |||
Net cash provided by (used in) investing activities | (10.6 | ) | (3.5 | ) | |||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||
Borrowings under revolving credit facilities | 169.6 | 0.3 | |||||
Repayments under revolving credit facilities | (157.6 | ) | (0.3 | ) | |||
Other short term borrowings | 3.4 | — | |||||
Issuance of common stock | — | 0.1 | |||||
Net cash provided by (used in) financing activities | 15.4 | 0.1 | |||||
CHANGE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | (16.7 | ) | (36.4 | ) | |||
Cash, cash equivalents and restricted cash, beginning of period | 39.7 | 168.0 | |||||
Cash, cash equivalents and restricted cash, end of period | $ | 23.0 | $ | 131.6 | |||
Supplemental Cash Flow Information: | |||||||
Cash paid for: | |||||||
Interest | $ | 0.4 | $ | 0.2 | |||
Taxes | 0.1 | 0.5 | |||||
Non-cash investing activities: | |||||||
Capital expenditures | 4.0 | — |
CENTURY ALUMINUM COMPANY | ||||||||||||||||||||||||||||
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY | ||||||||||||||||||||||||||||
(in millions) | ||||||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||||||
Preferred stock | Common stock | Additional paid-in capital | Treasury stock, at cost | Accumulated other comprehensive loss | Accumulated deficit | Total shareholders’ equity | ||||||||||||||||||||||
Balance, December 31, 2017 | $ | 0.0 | $ | 0.9 | $ | 2,517.4 | $ | (86.3 | ) | $ | (91.7 | ) | $ | (1,510.7 | ) | $ | 829.6 | |||||||||||
Net income (loss) | — | — | — | — | — | (0.3 | ) | (0.3 | ) | |||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | 0.4 | — | 0.4 | |||||||||||||||||||||
Share-based compensation | — | — | 0.7 | — | — | — | 0.7 | |||||||||||||||||||||
Conversion of preferred stock to common stock | 0.0 | 0.0 | 0.0 | — | — | — | 0.0 | |||||||||||||||||||||
Balance, March 31, 2018 | $ | 0.0 | $ | 0.9 | $ | 2,518.1 | $ | (86.3 | ) | $ | (91.3 | ) | $ | (1,511.0 | ) | $ | 830.4 | |||||||||||
Balance, December 31, 2018 | $ | 0.0 | $ | 1.0 | $ | 2,523.0 | $ | (86.3 | ) | $ | (98.7 | ) | $ | (1,576.8 | ) | $ | 762.2 | |||||||||||
Impact of ASU 2018-02* | — | — | — | — | (1.3 | ) | 1.3 | — | ||||||||||||||||||||
Net income (loss) | — | — | — | — | — | (34.6 | ) | (34.6 | ) | |||||||||||||||||||
Other comprehensive income (loss) | — | — | — | — | 0.3 | — | 0.3 | |||||||||||||||||||||
Share-based compensation | — | 0.0 | 0.3 | — | — | — | 0.3 | |||||||||||||||||||||
Conversion of preferred stock to common stock | 0.0 | 0.0 | 0.0 | — | — | — | 0.0 | |||||||||||||||||||||
Balance, March 31, 2019 | $ | 0.0 | $ | 1.0 | $ | 2,523.3 | $ | (86.3 | ) | $ | (99.7 | ) | $ | (1,610.1 | ) | $ | 728.1 |
1. | General |
2. | Related Party Transactions |
Three months ended March 31, | |||||||
2019 | 2018 | ||||||
Net sales to Glencore | $ | 311.3 | $ | 296.2 | |||
Purchases from Glencore | 90.7 | 48.4 | |||||
Purchases from BHH | 6.1 | 7.4 |
3. | Revenue |
Net Sales | For the three months ended March 31, | ||||||
2019 | 2018 | ||||||
United States | $ | 325.2 | $ | 268.2 | |||
Iceland | 164.8 | 186.3 | |||||
Total | $ | 490.0 | $ | 454.5 |
Year | As of March 31, 2019 | ||
2019 | $ | 1.4 | |
2020 | 0.5 | ||
2021 | 0.4 | ||
2022 | 0.1 | ||
2023 | 0.2 | ||
Thereafter | 40.8 | ||
Total | 43.4 | ||
Less: Interest | (18.6 | ) | |
ROUL | $ | 24.8 |
5. | Fair Value Measurements |
• | 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, 2019 | |||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
ASSETS: | ||||||||||||||||
Cash equivalents | $ | 14.3 | $ | — | $ | — | $ | 14.3 | ||||||||
Trust assets (1) | 0.1 | — | — | 0.1 | ||||||||||||
Surety bonds | 2.1 | — | — | 2.1 | ||||||||||||
Derivative instruments | — | 5.2 | 3.7 | 8.9 | ||||||||||||
TOTAL | $ | 16.5 | $ | 5.2 | $ | 3.7 | $ | 25.4 | ||||||||
LIABILITIES: | ||||||||||||||||
Contingent obligation – net | $ | — | $ | — | $ | — | $ | — | ||||||||
Derivative instruments | — | 5.2 | 3.6 | 8.8 | ||||||||||||
TOTAL | $ | — | $ | 5.2 | $ | 3.6 | $ | 8.8 | ||||||||
Recurring Fair Value Measurements | As of December 31, 2018 | |||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
ASSETS: | ||||||||||||||||
Cash equivalents | $ | 7.5 | $ | — | $ | — | $ | 7.5 | ||||||||
Trust assets (1) | 0.1 | — | — | 0.1 | ||||||||||||
Surety bonds | 2.1 | — | — | 2.1 | ||||||||||||
Derivative instruments | — | 3.2 | 5.0 | 8.2 | ||||||||||||
TOTAL | $ | 9.7 | $ | 3.2 | $ | 5.0 | $ | 17.9 | ||||||||
LIABILITIES: | ||||||||||||||||
Contingent obligation – net | $ | — | $ | — | $ | — | $ | — | ||||||||
Derivative instruments | — | 2.0 | 0.5 | 2.5 | ||||||||||||
TOTAL | $ | — | $ | 2.0 | $ | 0.5 | $ | 2.5 | ||||||||
(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. |
Level 2 and Level 3 Fair Value Measurements: | ||||||
Asset / Liability | Level | Valuation Techniques | Inputs | |||
LME forward financial sales contracts | 3 | Discounted cash flows | Quoted LME forward market, discount rate | |||
MWP forward financial sales contracts | 2 | Discounted cash flows | Quoted MWP forward market | |||
Fixed for floating swaps | 2 | Discounted cash flows | Quoted LME forward market, quoted MWP forward market | |||
Power price swaps | 3 | Discounted cash flows | Quoted Nordpool forward market, discount rate | |||
FX swaps | 3 | Discounted cash flows | Euro/USD forward exchange rate, discount rate | |||
Contingent obligation | 3 | Discounted cash flows | Quoted LME forward market, management’s estimates of the LME forward market prices for periods beyond the quoted periods, management’s estimates of future level of operations |
6. | Earnings (Loss) Per Share |
For the three months ended March 31, | |||||||||||||||||||
2019 | 2018 | ||||||||||||||||||
Net Income (Loss) | Shares (in millions) | Per Share | Net Income (Loss) | Shares (in millions) | Per Share | ||||||||||||||
Net income (loss) | $ | (34.6 | ) | $ | (0.3 | ) | |||||||||||||
Amount allocated to common stockholders | 100.0 | % | 100.0 | % | |||||||||||||||
Basic and Diluted EPS: (1) | $ | (34.6 | ) | 88.1 | $ | (0.39 | ) | $ | (0.3 | ) | 87.6 | 0.00 | |||||||
Three months ended March 31, | ||||||
Securities excluded from the calculation of diluted EPS (in millions)(1): | 2019 | 2018 | ||||
Share-based compensation | 0.6 | 1.4 |
7. | Shareholders’ Equity |
Preferred stock | Common stock | |||||||
Common and Preferred Stock Activity (in shares): | Series A convertible | Treasury | Outstanding | |||||
Beginning balance as of December 31, 2018 | 71,967 | 7,186,521 | 88,103,440 | |||||
Conversion of convertible preferred stock | (3,023 | ) | — | 302,255 | ||||
Issuance for share-based compensation plans | — | — | 402,062 | |||||
Ending balance as of March 31, 2019 | 68,944 | 7,186,521 | 88,807,757 | |||||
Beginning balance as of December 31, 2017 | 74,364 | 7,186,521 | 87,544,777 | |||||
Conversion of convertible preferred stock | (133 | ) | — | 13,343 | ||||
Issuance for share-based compensation plans | — | — | 17,749 | |||||
Ending balance as of March 31, 2018 | 74,231 | 7,186,521 | 87,575,869 |
8. | Income Taxes |
9. | Inventories |
March 31, 2019 | December 31, 2018 | ||||||
Raw materials | $ | 93.9 | $ | 100.8 | |||
Work-in-process | 50.0 | 49.5 | |||||
Finished goods | 35.9 | 47.3 | |||||
Operating and other supplies | 147.6 | 146.2 | |||||
Total inventories | $ | 327.4 | $ | 343.8 |
10. | Debt |
March 31, 2019 | December 31, 2018 | ||||||
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) | 35.3 | 23.3 | |||||
Other short-term borrowings | 3.4 | — | |||||
Debt classified as non-current liabilities: | |||||||
7.5% senior secured notes due June 1, 2021, net of debt discount of $1.2 million and $1.4 million, respectively, interest payable semiannually | 248.8 | 248.6 | |||||
Total | $ | 295.3 | $ | 279.7 |
Status of our U.S. revolving credit facility: | March 31, 2019 | ||
Credit facility maximum amount | $ | 175.0 | |
Borrowing availability | 175.0 | ||
Outstanding letters of credit issued | 37.7 | ||
Outstanding borrowings | 35.3 | ||
Borrowing availability, net of outstanding letters of credit and borrowings | 102.0 |
Status of our Iceland revolving credit facility: | March 31, 2019 | ||
Credit facility maximum amount | $ | 50.0 | |
Borrowing availability | 50.0 | ||
Outstanding letters of credit issued | — | ||
Outstanding borrowings | — | ||
Borrowing availability, net of borrowings | 50.0 |
11. | Commitments and Contingencies |
12. | Components of Accumulated Other Comprehensive Loss |
Components of AOCL: | March 31, 2019 | December 31, 2018 | |||||
Defined benefit plan liabilities | $ | (106.7 | ) | $ | (107.3 | ) | |
Unrealized loss on financial instruments | 2.4 | 2.5 | |||||
Other comprehensive loss before income tax effect | (104.3 | ) | (104.8 | ) | |||
Income tax effect (1) | 4.6 | 6.1 | |||||
Accumulated other comprehensive loss | $ | (99.7 | ) | $ | (98.7 | ) |
March 31, 2019 | December 31, 2018 | ||||||
Defined benefit plan liabilities | $ | 5.1 | $ | 6.6 | |||
Unrealized loss on financial instruments | (0.5 | ) | (0.5 | ) |
Defined benefit plan and other postretirement liabilities | Unrealized gain (loss) on financial instruments | Total, net of tax | |||||||||
Balance, December 31, 2018 | $ | (100.7 | ) | $ | 2.0 | $ | (98.7 | ) | |||
Impact of ASU 2018-02* | $ | (1.3 | ) | $ | — | $ | (1.3 | ) | |||
Net amount reclassified to net income (loss) | 0.3 | 0.0 | 0.3 | ||||||||
Balance, March 31, 2019 | $ | (101.7 | ) | $ | 2.0 | $ | (99.7 | ) | |||
Balance, January 1, 2018 | $ | (93.8 | ) | $ | 2.1 | $ | (91.7 | ) | |||
Net amount reclassified to net income (loss) | 0.4 | 0.0 | 0.4 | ||||||||
Balance, March 31, 2018 | $ | (93.4 | ) | $ | 2.1 | $ | (91.3 | ) |
Three months ended March 31, | |||||||||||
AOCL Components | Location | 2019 | 2018 | ||||||||
Defined benefit plan and other postretirement liabilities | Cost of goods sold | $ | 0.6 | $ | 0.7 | ||||||
Selling, general and administrative expenses | (0.4 | ) | (0.4 | ) | |||||||
Other operating expense, net | 0.4 | 0.5 | |||||||||
Income tax effect | (0.3 | ) | (0.4 | ) | |||||||
Net of tax | $ | 0.3 | $ | 0.4 | |||||||
Unrealized loss on financial instruments | Cost of goods sold | $ | 0.0 | $ | 0.0 | ||||||
Income tax effect | 0.0 | 0.0 | |||||||||
Net of tax | $ | 0.0 | $ | 0.0 |
13. | Components of Net Periodic Benefit Cost |
Pension Benefits | ||||||||
Three months ended March 31, | ||||||||
2019 | 2018 | |||||||
Service cost | $ | 1.1 | $ | 1.1 | ||||
Interest cost | 3.3 | 3.1 | ||||||
Expected return on plan assets | (4.9 | ) | (5.3 | ) | ||||
Amortization of prior service costs | 0.0 | 0.0 | ||||||
Amortization of net loss | 1.1 | 1.5 | ||||||
Net periodic benefit cost | $ | 0.6 | $ | 0.4 |
Other Postretirement Benefits ("OPEB") | ||||||||
Three months ended March 31, | ||||||||
2019 | 2018 | |||||||
Service cost | $ | 0.0 | $ | 0.1 | ||||
Interest cost | 1.0 | 1.1 | ||||||
Amortization of prior service cost | (1.3 | ) | (1.8 | ) | ||||
Amortization of net loss | 0.8 | 1.1 | ||||||
Net periodic benefit cost | $ | 0.5 | $ | 0.5 |
14. | Derivatives |
Asset Fair Value | |||||||
March 31, 2019 | December 31, 2018 | ||||||
Commodity contracts (1) | $ | 8.9 | $ | 8.2 | |||
Foreign exchange contracts (2) | — | — | |||||
Total | $ | 8.9 | $ | 8.2 | |||
Liability Fair Value | |||||||
March 31, 2019 | December 31, 2018 | ||||||
Commodity contracts (1) | $ | 8.3 | $ | 2.2 | |||
Foreign exchange contracts (2) | 0.5 | 0.3 | |||||
Total | $ | 8.8 | $ | 2.5 | |||
Three months ended March 31, | ||||||||
2019 | 2018 | |||||||
Commodity contracts(3) | $ | (5.5 | ) | $ | 0.7 | |||
Foreign exchange contracts | (0.2 | ) | — | |||||
Total | $ | (5.7 | ) | $ | 0.7 |
15. | Condensed Consolidating Financial Information |
Condensed Consolidating Statements of Comprehensive Income (Loss) | |||||||||||||||||||
For the three months ended March 31, 2019 | |||||||||||||||||||
The Company | Combined Guarantor Subsidiaries | Combined Non-Guarantor Subsidiaries | Consolidating Adjustments | Total Consolidated | |||||||||||||||
NET SALES: | |||||||||||||||||||
Related parties | $ | — | $ | 152.5 | $ | 158.8 | $ | — | $ | 311.3 | |||||||||
Other customers | — | 172.7 | 6.0 | — | 178.7 | ||||||||||||||
Total net sales | — | 325.2 | 164.8 | — | 490.0 | ||||||||||||||
Cost of goods sold | — | 327.2 | 175.6 | — | 502.8 | ||||||||||||||
Gross profit (loss) | — | (2.0 | ) | (10.8 | ) | — | (12.8 | ) | |||||||||||
Selling, general and administrative expenses | 14.1 | — | 0.6 | — | 14.7 | ||||||||||||||
Other operating (income) expense - net | — | — | 0.3 | — | 0.3 | ||||||||||||||
Operating income (loss) | (14.1 | ) | (2.0 | ) | (11.7 | ) | — | (27.8 | ) | ||||||||||
Interest expense | (5.4 | ) | (0.4 | ) | — | — | (5.8 | ) | |||||||||||
Intercompany interest | 8.7 | 2.5 | (11.2 | ) | — | — | |||||||||||||
Interest income | — | — | 0.2 | — | 0.2 | ||||||||||||||
Net gain (loss) on forward and derivative contracts | (4.7 | ) | 0.4 | (1.4 | ) | — | (5.7 | ) | |||||||||||
Other income (expense) - net | 0.8 | (0.5 | ) | 0.8 | — | 1.1 | |||||||||||||
Income (loss) before income taxes and equity in earnings of joint ventures | (14.7 | ) | — | (23.3 | ) | — | (38.0 | ) | |||||||||||
Income tax (expense) benefit | 1.0 | — | 1.9 | — | 2.9 | ||||||||||||||
Income (loss) before equity in earnings of joint ventures | (13.7 | ) | — | (21.4 | ) | — | (35.1 | ) | |||||||||||
Equity in earnings (loss) of joint ventures | (20.9 | ) | 0.3 | 0.5 | 20.6 | 0.5 | |||||||||||||
Net income (loss) | (34.6 | ) | 0.3 | (20.9 | ) | 20.6 | (34.6 | ) | |||||||||||
Other comprehensive income (loss) before income tax effect | 0.6 | 0.6 | 0.3 | (0.9 | ) | 0.6 | |||||||||||||
Income tax effect | (0.3 | ) | — | — | — | (0.3 | ) | ||||||||||||
Other comprehensive income (loss) | 0.3 | 0.6 | 0.3 | (0.9 | ) | 0.3 | |||||||||||||
Total comprehensive income (loss) | $ | (34.3 | ) | $ | 0.9 | $ | (20.6 | ) | $ | 19.7 | $ | (34.3 | ) |
Condensed Consolidating Statements of Comprehensive Income (Loss) | |||||||||||||||||||
For the three months ended March 31, 2018 | |||||||||||||||||||
The Company | Combined Guarantor Subsidiaries | Combined Non-Guarantor Subsidiaries | Consolidating Adjustments | Total Consolidated | |||||||||||||||
NET SALES: | |||||||||||||||||||
Related parties | $ | — | $ | 110.7 | $ | 185.5 | $ | — | $ | 296.2 | |||||||||
Other customers | — | 157.5 | 0.8 | — | 158.3 | ||||||||||||||
Total net sales | — | 268.2 | 186.3 | — | 454.5 | ||||||||||||||
Cost of goods sold | — | 261.2 | 178.8 | — | 440.0 | ||||||||||||||
Gross profit (loss) | — | 7.0 | 7.5 | — | 14.5 | ||||||||||||||
Selling, general and administrative expenses | 10.0 | — | 0.7 | — | 10.7 | ||||||||||||||
Other operating (income) expense - net | — | — | 0.3 | — | 0.3 | ||||||||||||||
Operating income (loss) | (10.0 | ) | 7.0 | 6.5 | — | 3.5 | |||||||||||||
Interest expense | (5.1 | ) | (0.4 | ) | — | — | (5.5 | ) | |||||||||||
Intercompany interest | 9.0 | 2.3 | (11.3 | ) | — | — | |||||||||||||
Interest income | 0.2 | — | 0.3 | — | 0.5 | ||||||||||||||
Net gain (loss) on forward and derivative contracts | — | 0.3 | 0.4 | — | 0.7 | ||||||||||||||
Other income (expense) - net | 0.5 | — | (1.6 | ) | — | (1.1 | ) | ||||||||||||
Income (loss) before income taxes and equity in earnings of joint ventures | (5.4 | ) | 9.2 | (5.7 | ) | — | (1.9 | ) | |||||||||||
Income tax (expense) benefit | (0.1 | ) | — | 1.1 | — | 1.0 | |||||||||||||
Income (loss) before equity in earnings of joint ventures | (5.5 | ) | 9.2 | (4.6 | ) | — | (0.9 | ) | |||||||||||
Equity in earnings (loss) of joint ventures | 5.2 | (0.3 | ) | 0.6 | (4.9 | ) | 0.6 | ||||||||||||
Net income (loss) | (0.3 | ) | 8.9 | (4.0 | ) | (4.9 | ) | (0.3 | ) | ||||||||||
Other comprehensive income (loss) before income tax effect | 0.8 | 0.7 | 0.4 | (1.1 | ) | 0.8 | |||||||||||||
Income tax effect | (0.4 | ) | — | — | — | (0.4 | ) | ||||||||||||
Other comprehensive income (loss) | 0.4 | 0.7 | 0.4 | (1.1 | ) | 0.4 | |||||||||||||
Total comprehensive income (loss) | $ | 0.1 | $ | 9.6 | $ | (3.6 | ) | $ | (6.0 | ) | $ | 0.1 |
Condensed Consolidating Balance Sheet | |||||||||||||||||||
As of March 31, 2019 | |||||||||||||||||||
The Company | Combined Guarantor Subsidiaries | Combined Non-Guarantor Subsidiaries | Consolidating Adjustments | Total Consolidated | |||||||||||||||
Cash & cash equivalents | $ | (0.1 | ) | $ | 0.1 | $ | 22.2 | $ | 22.2 | ||||||||||
Restricted cash | — | 0.8 | — | — | 0.8 | ||||||||||||||
Accounts receivable - net | 0.1 | 90.5 | 0.3 | — | 90.9 | ||||||||||||||
Due from affiliates | — | 21.4 | 2.4 | — | 23.8 | ||||||||||||||
Inventories | — | 202.7 | 124.7 | — | 327.4 | ||||||||||||||
Prepaid and other current assets | 9.3 | 0.8 | 8.1 | — | 18.2 | ||||||||||||||
Total current assets | 9.3 | 316.3 | 157.7 | — | 483.3 | ||||||||||||||
Property, plant and equipment - net | 20.1 | 318.8 | 621.2 | — | 960.1 | ||||||||||||||
Investment in subsidiaries | 648.1 | 54.8 | — | (702.9 | ) | — | |||||||||||||
Leases - right of use asset | 6.1 | 1.4 | 17.1 | 24.6 | |||||||||||||||
Due from affiliates - long term | 830.5 | 590.8 | 7.0 | (1,428.3 | ) | — | |||||||||||||
Other assets | 30.3 | 2.1 | 30.0 | — | 62.4 | ||||||||||||||
TOTAL | $ | 1,544.4 | $ | 1,284.2 | $ | 833.0 | $ | (2,131.2 | ) | $ | 1,530.4 | ||||||||
Accounts payable, trade | $ | 2.7 | $ | 85.0 | $ | 25.5 | $ | — | $ | 113.2 | |||||||||
Due to affiliates | — | — | 3.1 | — | 3.1 | ||||||||||||||
Accrued and other current liabilities | 26.5 | 16.7 | 16.0 | — | 59.2 | ||||||||||||||
Accrued employee benefits costs | 1.9 | 8.3 | 0.8 | — | 11.0 | ||||||||||||||
Revolving credit facility | 35.3 | — | — | — | 35.3 | ||||||||||||||
Industrial revenue bonds | — | 7.8 | — | — | 7.8 | ||||||||||||||
Total current liabilities | 66.4 | 117.8 | 45.4 | — | 229.6 | ||||||||||||||
Senior notes payable | 248.8 | — | — | — | 248.8 | ||||||||||||||
Accrued pension benefits costs - less current portion | 22.9 | 20.5 | 6.5 | — | 49.9 | ||||||||||||||
Accrued postretirement benefits costs - less current portion | 0.7 | 98.4 | 1.6 | — | 100.7 | ||||||||||||||
Due to affiliates - long term | 466.1 | 392.5 | 569.7 | (1,428.3 | ) | — | |||||||||||||
Other liabilities | 5.9 | 22.7 | 19.8 | — | 48.4 | ||||||||||||||
Leases - right of use liabilities | 5.8 | 0.3 | 16.7 | — | 22.8 | ||||||||||||||
Deferred taxes | (0.3 | ) | 1.8 | 100.6 | — | 102.1 | |||||||||||||
Total noncurrent liabilities | 749.9 | 536.2 | 714.9 | (1,428.3 | ) | 572.7 | |||||||||||||
Preferred stock | 0.0 | — | — | — | 0.0 | ||||||||||||||
Common stock | 1.0 | — | 0.1 | (0.1 | ) | 1.0 | |||||||||||||
Other shareholders' equity | 727.1 | 630.2 | 72.6 | (702.8 | ) | 727.1 | |||||||||||||
Total shareholders' equity | 728.1 | 630.2 | 72.7 | (702.9 | ) | 728.1 | |||||||||||||
TOTAL | $ | 1,544.4 | $ | 1,284.2 | $ | 833.0 | $ | (2,131.2 | ) | $ | 1,530.4 |
Condensed Consolidating Balance Sheet | |||||||||||||||||||
As of December 31, 2018 | |||||||||||||||||||
The Company | Combined Guarantor Subsidiaries | Combined Non-Guarantor Subsidiaries | Consolidating Adjustments | Total Consolidated | |||||||||||||||
Cash & cash equivalents | $ | 0.1 | $ | — | $ | 38.8 | $ | — | $ | 38.9 | |||||||||
Restricted cash | — | 0.8 | — | — | 0.8 | ||||||||||||||
Accounts receivable - net | 0.5 | 81.8 | 0.2 | — | 82.5 | ||||||||||||||
Due from affiliates | — | 13.1 | 9.6 | — | 22.7 | ||||||||||||||
Inventories | — | 210.7 | 133.1 | — | 343.8 | ||||||||||||||
Prepaid and other current assets | 6.4 | 3.4 | 8.2 | — | 18.0 | ||||||||||||||
Total current assets | 7.0 | 309.8 | 189.9 | — | 506.7 | ||||||||||||||
Property, plant and equipment - net | 20.6 | 320.7 | 626.0 | — | 967.3 | ||||||||||||||
Investment in subsidiaries | 668.3 | 54.5 | — | (722.8 | ) | — | |||||||||||||
Due from affiliates - long term | 751.7 | 517.6 | 7.2 | (1,276.5 | ) | — | |||||||||||||
Other assets | 29.8 | 2.1 | 31.6 | — | 63.5 | ||||||||||||||
TOTAL | $ | 1,477.4 | $ | 1,204.7 | $ | 854.7 | $ | (1,999.3 | ) | $ | 1,537.5 | ||||||||
Accounts payable, trade | $ | 3.7 | $ | 84.1 | $ | 31.6 | $ | — | $ | 119.4 | |||||||||
Due to affiliates | — | — | 10.3 | — | 10.3 | ||||||||||||||
Accrued and other current liabilities | 15.8 | 22.8 | 13.9 | — | 52.5 | ||||||||||||||
Accrued employee benefits costs | 1.9 | 8.3 | 0.8 | — | 11.0 | ||||||||||||||
Revolving credit facility | 23.3 | — | — | — | 23.3 | ||||||||||||||
Industrial revenue bonds | — | 7.8 | — | — | 7.8 | ||||||||||||||
Total current liabilities | 44.7 | 123.0 | 56.6 | — | 224.3 | ||||||||||||||
Senior notes payable | 248.6 | — | — | — | 248.6 | ||||||||||||||
Accrued pension benefits costs - less current portion | 23.2 | 20.7 | 7.0 | — | 50.9 | ||||||||||||||
Accrued postretirement benefits costs - less current portion | 0.7 | 98.9 | 1.6 | — | 101.2 | ||||||||||||||
Other liabilities | 2.8 | 23.5 | 19.7 | — | 46.0 | ||||||||||||||
Due to affiliates - long term | 395.4 | 307.6 | 573.5 | (1,276.5 | ) | — | |||||||||||||
Deferred taxes | (0.2 | ) | 1.8 | 102.7 | — | 104.3 | |||||||||||||
Total noncurrent liabilities | 670.5 | 452.5 | 704.5 | (1,276.5 | ) | 551.0 | |||||||||||||
Preferred stock | 0.0 | — | — | — | 0.0 | ||||||||||||||
Common stock | 1.0 | — | 0.1 | (0.1 | ) | 1.0 | |||||||||||||
Other shareholders' equity | 761.2 | 629.2 | 93.5 | (722.7 | ) | 761.2 | |||||||||||||
Total shareholders' equity | 762.2 | 629.2 | 93.6 | (722.8 | ) | 762.2 | |||||||||||||
TOTAL | $ | 1,477.4 | $ | 1,204.7 | $ | 854.7 | $ | (1,999.3 | ) | $ | 1,537.5 |
Condensed Consolidating Statement of Cash Flows | |||||||||||||||||||
For the three months ended March 31, 2019 | |||||||||||||||||||
The Company | Combined Guarantor Subsidiaries | Combined Non-Guarantor Subsidiaries | Consolidating Adjustments | Total Consolidated | |||||||||||||||
Net cash provided by (used in) operating activities | $ | (17.6 | ) | $ | (5.3 | ) | $ | 1.4 | $ | (21.5 | ) | ||||||||
Purchase of property, plant and equipment | (0.6 | ) | (6.8 | ) | (3.2 | ) | — | (10.6 | ) | ||||||||||
Intercompany transactions | (15.2 | ) | (17.7 | ) | 0.1 | 32.8 | — | ||||||||||||
Net cash provided by (used in) investing activities | (15.8 | ) | (24.5 | ) | (3.1 | ) | 32.8 | (10.6 | ) | ||||||||||
Borrowings under revolving credit facilities | 169.6 | — | — | — | 169.6 | ||||||||||||||
Repayments under revolving credit facilities | (157.6 | ) | — | — | — | (157.6 | ) | ||||||||||||
Other short term borrowings | 3.4 | — | — | — | 3.4 | ||||||||||||||
Intercompany transactions | 17.8 | 29.9 | (14.9 | ) | (32.8 | ) | — | ||||||||||||
Net cash provided by (used in) financing activities | 33.2 | 29.9 | (14.9 | ) | (32.8 | ) | 15.4 | ||||||||||||
CHANGE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | (0.2 | ) | 0.1 | (16.6 | ) | — | (16.7 | ) | |||||||||||
Cash, cash equivalents and restricted cash, beginning of period | 0.1 | 0.8 | 38.8 | — | 39.7 | ||||||||||||||
Cash, cash equivalents and restricted cash, end of period | $ | (0.1 | ) | $ | 0.9 | $ | 22.2 | $ | — | $ | 23.0 |
Condensed Consolidating Statement of Cash Flows | |||||||||||||||||||
For the three months ended March 31, 2018 | |||||||||||||||||||
The Company | Combined Guarantor Subsidiaries | Combined Non-Guarantor Subsidiaries | Consolidating Adjustments | Total Consolidated | |||||||||||||||
Net cash provided by (used in) operating activities | $ | (26.8 | ) | $ | (26.8 | ) | $ | 20.6 | $ | — | $ | (33.0 | ) | ||||||
Purchase of property, plant and equipment | (1.5 | ) | (0.4 | ) | (1.6 | ) | — | (3.5 | ) | ||||||||||
Intercompany transactions | (23.8 | ) | — | — | 23.8 | — | |||||||||||||
Net cash provided by (used in) investing activities | (25.3 | ) | (0.4 | ) | (1.6 | ) | 23.8 | (3.5 | ) | ||||||||||
Borrowings under revolving credit facilities | 0.3 | — | — | — | 0.3 | ||||||||||||||
Repayments under revolving credit facilities | (0.3 | ) | — | — | — | (0.3 | ) | ||||||||||||
Issuance of common stock | 0.1 | — | — | — | 0.1 | ||||||||||||||
Intercompany transactions | (3.8 | ) | 27.2 | 0.4 | (23.8 | ) | — | ||||||||||||
Net cash provided by (used in) financing activities | (3.7 | ) | 27.2 | 0.4 | (23.8 | ) | 0.1 | ||||||||||||
CHANGE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | (55.8 | ) | — | 19.4 | — | (36.4 | ) | ||||||||||||
Cash, cash equivalents and restricted cash, beginning of period | 64.3 | 0.7 | 103.0 | — | 168.0 | ||||||||||||||
Cash, cash equivalents and restricted cash, end of period | $ | 8.5 | $ | 0.7 | $ | 122.4 | $ | — | $ | 131.6 |
• | Future global and local financial and economic conditions; |
• | Our assessment of the aluminum market and aluminum prices (including premiums); |
• | Our ability to procure alumina, carbon products and other raw materials and our assessment of pricing and costs and other terms relating thereto; |
• | The future impact of any Section 232 relief, including tariffs or other trade remedies, to Century, on aluminum prices or more generally, 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 or other action affecting our business, including, without limitation, the impact of any trade actions, sanctions or other similar remedies or restrictions implemented by the U.S. or foreign governments; |
• | Our assessment of power pricing and our ability to successfully obtain and/or implement long-term competitive power arrangements for our operations and projects; |
• | Our ability to successfully manage transmission issues and market power price risk and to control or reduce power costs; |
• | Our plans and expectations with respect to the future operation of our smelters and our other operations, including any plans and expectations to curtail or restart production at any of our operations; |
• | Our intention and ability to bring our Hawesville smelter back to full production and any plans, expectations, costs or assumptions with respect thereto; |
• | Any future impact of the May 2018 equipment failure at Sebree and related events on our financial and operating performance, including our expectations with respect to insurance coverage relating thereto; |
• | Future investments in new technology or other production improvements; |
• | Our ability to hire and retain qualified employees for our operations; |
• | Our plans and expectations with respect to the sale or other disposition of our 40% interest in BHH; |
• | The future financial and operating performance of the Company, its subsidiaries and its projects; |
• | Future inventory, production, sales, cash costs and capital expenditures; |
• | Future impairment charges or restructuring costs; |
• | Our anticipated tax liabilities, benefits or refunds including the realization of U.S. and certain foreign deferred tax assets and liabilities and the impact of recent tax reform in the U.S. and foreign jurisdictions; |
• | Access to existing or future financing arrangements and the terms of any such future financing arrangements; |
• | Our ability to refinance or repay debt in the future; |
• | 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; |
• | Future construction investment and development, including our expansion project at our Grundartangi smelter and our plans and expectations with respect thereto; |
• | The anticipated impact of recent accounting pronouncements or changes in accounting principles; |
• | Our assessment of the ultimate outcome of outstanding litigation and environmental matters and liabilities relating thereto; |
• | Negotiations with labor unions representing certain of our employees; and |
• | Our future business objectives, plans, strategies and initiatives, including our competitive position and prospects. |
• | the price of primary aluminum, which is based on the LME and other exchanges, plus any regional premiums and value-added product premiums; |
• | the cost of goods sold, the principal components of which are electrical power, alumina, carbon products and labor, which in aggregate represent more than 75% of our cost of goods sold; and |
• | our production and shipment volume. |
Three months ended March 31, | |||||||
2019 | 2018 | ||||||
(in millions, except per share data) | |||||||
NET SALES: | |||||||
Related parties | $ | 311.3 | $ | 296.2 | |||
Other customers | 178.7 | 158.3 | |||||
Total net sales | 490.0 | 454.5 | |||||
Gross profit (loss) | (12.8 | ) | 14.5 | ||||
Net income (loss) | (34.6 | ) | (0.3 | ) | |||
EARNINGS (LOSS) PER COMMON SHARE: | |||||||
Basic and Diluted | $ | (0.39 | ) | $ | 0.00 |
SHIPMENTS - PRIMARY ALUMINUM(1) | ||||||||||||||||||||
United States | Iceland | Total | ||||||||||||||||||
Tonnes | Net Sales (in millions) | Tonnes | Net Sales (in millions) | Tonnes | Net Sales (in millions) | |||||||||||||||
2019 | ||||||||||||||||||||
1st Quarter | 130,043 | $ | 313.3 | 76,408 | $ | 159.3 | 206,451 | $ | 472.6 | |||||||||||
2018 | ||||||||||||||||||||
1st Quarter | 107,145 | $ | 266.4 | 80,093 | $ | 185.6 | 187,238 | $ | 452.0 |
Net sales (in millions) | 2019 | 2018 | |||||
Three months ended March 31, | $ | 490.0 | $ | 454.5 |
Gross profit (loss) (in millions) | 2019 | 2018 | |||||
Three months ended March 31, | $ | (12.8 | ) | $ | 14.5 |
Selling, general and administrative expenses (in millions) | 2019 | 2018 | |||||
Three months ended March 31, | $ | 14.7 | $ | 10.7 |
Net gain (loss) on forward and derivative contracts (in millions) | 2019 | 2018 | |||||
Three months ended March 31, | $ | (5.7 | ) | $ | 0.7 |
Income tax benefit (expense) (in millions) | 2019 | 2018 | |||||
Three months ended March 31, | $ | 2.9 | $ | 1.0 |
Three months ended March 31, | |||||||
2019 | 2018 | ||||||
(in millions) | |||||||
Net cash provided by (used in) operating activities | $ | (21.5 | ) | $ | (33.0 | ) | |
Net cash provided by (used in) investing activities | (10.6 | ) | (3.5 | ) | |||
Net cash provided by (used in) financing activities | 15.4 | 0.1 | |||||
Change in cash, cash equivalents and restricted cash | $ | (16.7 | ) | $ | (36.4 | ) |
Hawesville | Sebree | Mt. Holly | Grundartangi | Total | |||||||||||||||
Expected average load (in megawatts ("MW")) | 482 | 385 | 400 | 537 | 1,804 | ||||||||||||||
Quarterly estimated electrical power usage (in megawatt hours ("MWh")) | 1,055,580 | 843,150 | 876,000 | 1,176,030 | 3,950,760 | ||||||||||||||
Quarterly cost impact of an increase or decrease of $1 per MWh (in millions) | $ | 1.1 | $ | 0.8 | $ | 0.9 | $ | 1.2 | $ | 4.0 | |||||||||
Annual expected electrical power usage (in MWh) | 4,222,320 | 3,372,600 | 3,504,000 | 4,704,120 | 15,803,040 | ||||||||||||||
Annual cost impact of an increase or decrease of $1 per MWh (in millions) | $ | 4.2 | $ | 3.4 | $ | 3.5 | $ | 4.7 | $ | 15.8 |
Asset Fair Value | Fair Value with 10% Adverse Price Change | ||||||
Commodity contracts (1) | $ | 8.9 | $ | 7.6 | |||
Foreign exchange contracts (2) | — | — | |||||
Total | $ | 8.9 | $ | 7.6 |
Liability Fair Value | Fair Value with 10% Adverse Price Change | ||||||
Commodity contracts (1) | $ | 8.3 | $ | 23.2 | |||
Foreign exchange contracts (2) | 0.5 | 1.1 | |||||
Total | $ | 8.8 | $ | 24.3 |
Exhibit Number | Description of Exhibit | Incorporated by Reference | Filed Herewith | ||
Form | File No. | Filing Date | |||
31.1 | X | ||||
31.2 | X | ||||
32.1 | X | ||||
32.2 | 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: | May 8, 2019 | By: | /s/ CRAIG CONTI | |
Craig Conti | ||||
Executive Vice President and Chief Financial Officer (Principal Financial Officer) | ||||
Date: | May 8, 2019 | By: | /s/ ELISABETH INDRIANI | |
Elisabeth Indriani | ||||
Global Controller (Principal Accounting 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 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 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: | May 8, 2019 | |
/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 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 my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me 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 my 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 my 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 and I have disclosed, based on my 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: | May 8, 2019 | ||
/s/ CRAIG CONTI | |||
Name: Craig Conti | |||
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: | May 8, 2019 |
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/ CRAIG CONTI | ||
By: | Craig Conti | |
Title: | Executive Vice President and Chief Financial Officer (Principal Financial Officer) | |
Date: | May 8, 2019 |
Document And Entity Information - shares |
3 Months Ended | |
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Mar. 31, 2019 |
Apr. 30, 2019 |
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Document and Entity Information [Abstract] | ||
Entity Registrant Name | CENTURY ALUMINUM CO | |
Entity Central Index Key | 0000949157 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2019 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Entity Common Stock, Shares Outstanding | 88,816,757 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Millions |
3 Months Ended | |
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Mar. 31, 2019 |
Mar. 31, 2018 |
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Comprehensive income (loss): | ||
Net income (loss) | $ (34.6) | $ (0.3) |
Other comprehensive income before income tax effect: | ||
Net loss on foreign currency cash flow hedges reclassified as income | 0.0 | 0.0 |
Defined benefit plans and other postretirement benefits: | ||
Amortization of prior service benefit during the period | (1.3) | (1.8) |
Amortization of net loss during the period | 1.9 | 2.6 |
Other comprehensive income before income tax effect | 0.6 | 0.8 |
Income tax effect | (0.3) | (0.4) |
Other comprehensive income | 0.3 | 0.4 |
Total comprehensive income (loss) | $ (34.3) | $ 0.1 |
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY - USD ($) $ in Millions |
Total |
Preferred stock [Member] |
Common stock [Member] |
Additional paid-in capital [Member] |
Treasury stock, at cost [Member] |
Accumulated other comprehensive loss [Member] |
Accumulated deficit [Member] |
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Balance, start at Dec. 31, 2017 | $ 829.6 | $ 0.0 | $ 0.9 | $ 2,517.4 | $ (86.3) | $ (91.7) | $ (1,510.7) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income (loss) | (0.3) | (0.3) | |||||
Other comprehensive income (loss) | 0.4 | 0.4 | |||||
Share-based compensation | 0.7 | 0.7 | |||||
Conversion of preferred stock to common stock | 0.0 | 0.0 | 0.0 | 0.0 | |||
Balance, end at Mar. 31, 2018 | 830.4 | 0.0 | 0.9 | 2,518.1 | (86.3) | (91.3) | (1,511.0) |
Balance, start at Dec. 31, 2018 | 762.2 | 0.0 | 1.0 | 2,523.0 | (86.3) | (98.7) | (1,576.8) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income (loss) | (34.6) | (34.6) | |||||
Other comprehensive income (loss) | 0.3 | 0.3 | |||||
Share-based compensation | 0.3 | 0.0 | 0.3 | ||||
Conversion of preferred stock to common stock | 0.0 | 0.0 | 0.0 | 0.0 | |||
Balance, end at Mar. 31, 2019 | $ 728.1 | $ 0.0 | $ 1.0 | $ 2,523.3 | $ (86.3) | $ (99.7) | $ (1,610.1) |
General |
3 Months Ended |
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Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
General | General 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, 2018. 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 2019 are not necessarily indicative of the results that may be expected for the year ending December 31, 2019. 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. Recently Adopted Accounting Standards On January 1, 2019, we adopted Financial Accounting Standards Board ("FASB") Accounting Standards Update ("ASU") 2016-02, "Leases (Topic 842).” See Note 4. Leases for further information regarding our adoption of ASC 842 and impacts to the financial statements. On January 1, 2019, we adopted FASB ASU 2018-02, “Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income.” See Note 8. Income Taxes for further information regarding our adoption of ASU 2018-02. For the quarter ended March 31, 2019, we have adopted the requirements in SEC Final Rule 33-10532 “Disclosure Updates and Simplification.” The adoption of this guidance resulted in presentation of the Consolidated Statements of Shareholders' Equity as part of our quarterly financial statements. |
Related Party Transactions |
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Related Party Transactions [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Related Party Transactions | Related Party Transactions The significant related party transactions occurring during the three months ended March 31, 2019 and 2018 are described below. We believe all of our transactions with Glencore and BHH are at prices that approximate market. Glencore ownership As of March 31, 2019, Glencore plc and its affiliates (together "Glencore") beneficially owned 42.9% of Century’s outstanding common stock (47.0% 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 7. Shareholders' Equity for a description of our outstanding Series A Convertible Preferred Stock. From time to time Century and Glencore enter into various transactions for the purchase and sale of primary aluminum, purchase and sale of alumina, and certain forward financial contracts. Sales to Glencore For the three months ended March 31, 2019 and 2018 we derived approximately 64% and 65%, respectively, of our consolidated sales from Glencore. Glencore purchases the aluminum we produce for resale. Glencore purchases aluminum produced at our North American smelters at prices based on the London Metal Exchange (the "LME") plus the Midwest regional delivery premium and any product premiums. Glencore purchases aluminum produced at our Grundartangi, Iceland smelter at prices based on the LME plus the European Duty Paid premium and any applicable product premiums. We have entered into agreements with Glencore pursuant to which we sell certain amounts of alumina at prices that approximate market. For the three months ended March 31, 2019, we recorded $8.2 million of revenue related to 21,865 metric tonnes. Purchases from Glencore We purchase a portion of our alumina requirements from Glencore. Alumina purchases from Glencore during the three months ended March 31, 2019, were priced based on a published alumina index. Financial contracts with Glencore We have certain financial contracts with Glencore. See Note 14. Derivatives regarding these forward financial sales contracts. Glencore Loan On April 29, 2019, we entered into a Loan Agreement dated as of April 29, 2019 (the “Loan Agreement”) with Glencore pursuant to which we borrowed $40.0 million (the “Loan”) on that date. See Note 10. Debt for additional information. Transactions with Baise Haohai Carbon Co., Ltd. ("BHH") We own a 40% stake in BHH and have an agreement to purchase carbon anodes from them for use in our manufacturing operations. Summary A summary of the aforementioned significant related party transactions is as follows:
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Revenue |
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Revenue Recognition and Deferred Revenue [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue | Revenue We recognize revenue in accordance with ASC 606, “Revenue from Contracts with Customers” and the related amendments (“ASC 606”). We disaggregate our revenue by geographical region as follows:
Trade accounts receivable - net increased by $6.0 million from December 31, 2018, driven primarily by outstanding receivables due from third party customers with longer payment terms than our related party customer. |
Leases |
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Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||
Leases | Leases On January 1, 2019 we adopted ASC 842, “Leases” and the related amendments (“ASC 842”) using the modified retrospective transition method. Accordingly, the comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. The cumulative effect to retained earnings of initially applying this standard was zero. In adopting ASC 842, we have not separated lease and non-lease components within our contracts and we have not recognized the impact of leases with terms of less than one year in the right of use asset (“ROUA”) and right of use liability (“ROUL”) balances recorded as part of the adoption of ASC 842. Furthermore, we elected the package of three practical expedients, which allowed us to not reassess whether expired or existing contracts contain leases, lease classification of existing leases, and whether previously capitalized initial direct costs would qualify for capitalization under Topic 842. We do not have any initial direct costs that were previously capitalized. As of March 31, 2019, our ROUA balance recorded in Leases-right of use assets as part of Non-current assets is $24.6 million, our ROUL balance recorded as part of Accrued and other current liabilities is $2.0 million and our ROUL balance recorded as part of noncurrent liabilities is $22.8 million. The undiscounted maturities of our operating lease liability balances are as follows (in millions):
We are a lessee in various agreements for the lease of office space, land, automobiles, and mobile equipment. All our leases are considered operating leases. The terms of our leases vary, including the lease term and the ability to renew or extend certain leases. As part of determining the lease term and potential extensions for purposes of calculating the ROUA and ROUL, we considered our historical practices related to renewal of certain leases. The weighted average remaining lease term for our operating leases as of March 31, 2019 is 15.0 years. Certain lease payment amounts are variable in nature and change periodically based on the local market consumer price index. We used our incremental borrowing rate as the basis for the discount rate used to calculate the ROUA and ROUL for our operating leases. The incremental borrowing rate was determined on a lease-by-lease basis and is based on the rate of interest that we would have to pay to borrow on a collateralized basis over a similar term for an amount equal to our lease payments. We have considered the most likely financing options available for each lease based on the leased asset, legal entity party to the lease, economic environment in which the lease is denominated, the market conditions relative to the leased asset and our historical practices of obtaining financing for similar types of costs. The weighted average discount rate for our operating leases as of March 31, 2019 is 7.3%. Total operating lease expense for the three-month period ended March 31, 2019 was $2.2 million, which includes short term lease expense of $1.2 million. The total lease expense for the period is included in Cost of goods sold on the Consolidated Statements of Operations. The full balance of operating lease expense is included in operating income on the Consolidated Statements of Operations. During the three-month period ended March 31, 2019, we had cash outflows of $1.0 million for amounts included in the ROUL balance at the beginning of the period related to our operating leases. During the first quarter of 2019, we did not enter any material new lease agreements. |
Fair Value Measurements |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements | 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. 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:
The following section describes the valuation techniques and inputs used for fair value measurements categorized within Level 2 or Level 3 of the fair value hierarchy:
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Earnings (Loss) Per Share |
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Earnings (Loss) Per Share | Earnings (Loss) Per Share Basic earnings (loss) per share ("EPS") amounts are calculated by dividing net income (loss) allocated to common stockholders by the weighted average number of common shares outstanding during the period. Diluted EPS amounts assume the issuance of common stock for all potentially dilutive securities. The following table shows the basic and diluted earnings (loss) per share:
(1) In periods when we report a net loss, all share-based compensation awards are excluded from the calculation of diluted weighted average shares outstanding because of their anti-dilutive effect on earnings (loss) per share. |
Shareholders’ Equity |
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Shareholders’ Equity | Shareholders’ Equity Common Stock As of March 31, 2019 and December 31, 2018, we had 195,000,000 shares of common stock, $0.01 par value per share, authorized under our Restated Certificate of Incorporation, of which 95,994,278 shares were issued and 88,807,757 shares were outstanding at March 31, 2019; 95,289,961 shares were issued and 88,103,440 shares were outstanding at December 31, 2018. 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, 2019 and December 31, 2018, we had 5,000,000 shares of preferred stock, $0.01 par value per share, authorized under our Restated Certificate of Incorporation. In 2008, we issued 160,000 shares of our Series A Convertible Preferred Stock. At March 31, 2019 and December 31, 2018, there were 68,944 and 71,967 shares of Series A Convertible Preferred Stock outstanding, respectively, and held by Glencore. 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. The Common and Preferred Stock table below contains additional information about preferred stock conversions during the three months ended March 31, 2019 and 2018.
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, 2019, we had repurchased 7,186,521 shares of common stock for an aggregate purchase price of $86.3 million. We have made no share repurchases since April 2015 and we have $43.7 million remaining under the repurchase program authorization as of March 31, 2019. |
Income Taxes |
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Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes We recorded income tax benefit of $2.9 million and $1.0 million for the three months ended March 31, 2019 and March 31, 2018, respectively, which primarily consisted of tax benefits on losses from foreign operations. Our income tax benefit or expense is based on an annual effective tax rate forecast, including estimates and assumptions that could change during the year. The application of the accounting requirements for income taxes in interim periods, after consideration of our valuation allowance, causes a significant variation in the typical relationship between income tax expense/benefit and pre-tax accounting income/loss. As of March 31, 2019, all of Century's U.S. and certain foreign deferred tax assets, net of deferred tax liabilities, continue to be subject to a valuation allowance. On December 22, 2017, the President of the United States signed into law tax reform legislation (informally known as the Tax Cuts and Jobs Act (the "Act" or "Tax Act")) that made significant changes to various areas of U.S. federal income tax law. On January 1, 2019, the Company adopted ASU 2018-02, "Income Statement-Reporting Comprehensive Income (Topic 220), Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income," which provides for the reclassification from accumulated other comprehensive income to retained earnings of stranded tax effects resulting from the Tax Act. In accordance with the provisions of the ASU, $1.3 million of stranded tax effects related to the Tax Act were reclassified from accumulated other comprehensive loss to retained earnings in the first quarter of 2019. This reclassification includes the impact of the change in the federal corporate income tax rate and the related federal benefit of state taxes. The Company’s accounting policy with respect to releasing income tax effects from accumulated other comprehensive income is to apply a security by security approach whereby the tax effects are measured based on the change in the unrealized gains or losses reflected in other comprehensive loss. |
Inventories |
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Inventories | Inventories Inventories consist of the following:
Inventories are stated at the lower of cost or Net Realizable Value ("NRV") using the first-in, first-out ("FIFO") or the weighted average cost method. |
Debt |
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Debt | Debt
(2) The U.S. revolving credit facility is classified as a current liability because we repay amounts outstanding and reborrow funds based on our working capital requirements. Borrowings bear interest at our option of either LIBOR or a base rate, plus, in each case, an applicable interest margin. At March 31, 2019, interest on the base rate portion was 5.75%, and interest on the LIBOR portion was 3.74%. 7.5% Notes due 2021 General. On June 4, 2013, we issued $250.0 million of our 7.5% Notes due June 1, 2021 (the "2021 Notes") in a private offering exempt from the registration requirements of the Securities Act of 1933, as amended. The 2021 Notes were issued at a discount and bear interest at the rate of 7.5% per annum on the principal amount, payable semi-annually in arrears in cash on June 1st and December 1st of each year. Fair Value. Fair value for our 2021 Notes was based on the latest trading data available and was $251.3 million and $247.9 million, as of March 31, 2019 and December 31, 2018, respectively. 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. Glencore Loan On April 29, 2019, we entered into the Loan Agreement with Glencore pursuant to which the Company borrowed $40.0 million on that date. The Loan matures on December 31, 2021, and is to be repaid in twenty-four (24) equal monthly installments of principal, together with interest, beginning on January 31, 2020. The Loan bears interest at a floating rate equal to LIBOR plus 5.375% and is not secured by any collateral. 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 (the "U.S. revolving credit facility"). The U.S. revolving credit facility provides for borrowings of up to $175.0 million in the aggregate, including up to $110.0 million under a letter of credit sub-facility, and also includes an uncommitted accordion feature whereby borrowers may increase the capacity of the U.S. revolving credit facility by up to $50.0 million, subject to agreement with the lenders. The U.S. revolving credit facility matures on the earlier of May 2023 or six months before the stated maturity of our outstanding senior secured notes. 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, 2019, there were $35.3 million in outstanding borrowings under our U.S. revolving credit facility. Principal payments, if any, are due upon maturity of the U.S. revolving credit facility.
Iceland Revolving Credit Facility Our wholly-owned subsidiary, Nordural Grundartangi ehf ("Grundartangi"), has entered into a $50.0 million revolving credit facility agreement with Landsbankinn hf., dated November 2013 as amended. 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. The Iceland revolving credit facility has a term through November 2020.
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Commitments and Contingencies |
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Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and contingencies | Commitments and Contingencies Environmental Contingencies Based upon all available information, we believe our current environmental liabilities do not have, and are not likely to have, a material adverse effect on our financial condition, results of operations or liquidity. However, because of the inherent uncertainties in estimating environmental liabilities primarily due to unknown facts and circumstances and changing governmental regulations and legal standards regarding liability, there can be no assurance that future capital expenditures and costs for environmental compliance at currently or formerly owned or operated properties will not result in liabilities that may have a material adverse effect on our financial condition, results of operations or liquidity. It is our policy to accrue for costs associated with environmental assessments and remedial efforts when it becomes probable that a liability has been incurred and the costs can be reasonably estimated. All accrued amounts have been recorded without giving effect to any possible future recoveries. Costs for ongoing environmental compliance, including maintenance and monitoring are expensed as incurred. Vernon In July 2006, we were named as a defendant, together with certain affiliates of Alcan Inc., in a lawsuit brought by Alcoa Inc. seeking to determine responsibility for certain environmental indemnity obligations related to the sale of a cast aluminum plate manufacturing facility located in Vernon, California, which we purchased from Alcoa Inc. in December 1998, and sold to Alcan Rolled Products-Ravenswood LLC in July 1999. The complaint also seeks costs and attorney fees. The matter was stayed by the court in 2008 to allow for the remediation of environmental areas at the site. On June 30, 2016, the U.S. District Court for the District of Delaware ordered the stay lifted and reopened the case. Discovery is expected to be completed in the second or third quarter of 2019, and trial is currently set to begin in the second quarter of 2020. At this stage, we cannot predict the ultimate outcome of this action or estimate a range of possible losses related to this matter. Matters relating to the St. Croix Alumina Refining Facility We are a party to a United States Environmental Protection Agency Administrative Order on Consent (the "Order") pursuant to which certain past and present owners of an alumina refining facility at St. Croix, Virgin Islands (the "St. Croix Alumina Refinery") have agreed to carry out a Hydrocarbon Recovery Plan to remove and manage hydrocarbons floating on groundwater underlying the facility. Pursuant to the Hydrocarbon Recovery Plan, recovered hydrocarbons and groundwater are delivered to the adjacent petroleum refinery where they are received and managed. At this time, we are not able to estimate the amount of any future potential payments under this indemnification to comply with the Order, but we do not anticipate that any such amounts will have a material adverse effect on our financial condition, results of operations or liquidity, regardless of the final outcome. In December 2010, Century was among several defendants named in a lawsuit filed by plaintiffs who either worked, resided or owned property in the area downwind from the St. Croix Alumina Refinery. In March 2011, Century was also named a defendant in a nearly identical suit brought by certain additional plaintiffs. The plaintiffs in both suits allege damages caused by the presence of red mud and other particulates coming from the alumina facility and are seeking unspecified monetary damages, costs and attorney fees as well as certain injunctive relief. We tendered indemnity and defense to St. Croix Alumina LLC and Alcoa Alumina & Chemical LLC under the terms of an acquisition agreement relating to the facility and have filed motions to dismiss plaintiffs’ claims. In August 2015, the Superior Court of the Virgin Islands, Division of St. Croix denied the motions to dismiss but ordered all plaintiffs to refile individual complaints. On February 28, 2018, plaintiffs in both cases filed a Motion for Voluntary Dismissal of Century without prejudice to refiling. At this time, it is not possible to predict the ultimate outcome of or to estimate a range of possible losses for any of the foregoing actions relating to the St. Croix Alumina Refinery. Legal Contingencies In addition to the foregoing matters, we have pending against us or may be subject to various lawsuits, claims and proceedings related primarily to employment, commercial, stockholder, safety and health matters. While the results of such litigation matters and claims cannot be predicted with certainty, we believe that the final outcome of such matters 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, should the 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 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 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. When we have assessed that a loss associated with legal contingencies is reasonably possible, we determine if estimates of possible losses or ranges of possible losses are in excess of related accrued liabilities, if any. Based on current knowledge, management has ascertained estimates for losses that are reasonably possible and management does not believe that any reasonably possible outcomes in excess of our accruals, if any, either individually or in aggregate, would be material to our financial condition, results of operations or liquidity. We reevaluate and update our assessments and accruals as matters progress over time. Ravenswood Retiree Medical Benefits Changes 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. Under the terms of the settlement 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 the liability 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, 2019, $2.0 million had been recorded in other current liabilities and $10.0 million was recorded in other liabilities. PBGC Settlement In 2013, we entered into a settlement agreement with the Pension Benefit Guarantee Corporation ("PBGC") regarding an alleged "cessation of operations" at our Ravenswood facility. Pursuant to the terms of the 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 are able to defer one or more of these payments provided that we provide the PBGC with acceptable security for such deferred payments. We did not make any contributions for the three month periods ended March 31, 2019 and 2018. We have elected to defer certain payments under the PBGC agreement and have provided the PBGC with the appropriate security. The remaining contributions under this agreement are approximately $9.6 million. Power Commitments and Contingencies Hawesville Hawesville has a power supply arrangement with Kenergy and EDF Trading North America, LLC (“EDF") which provides market-based power to the Hawesville smelter. Under this arrangement, the power companies purchase power on the open market and pass it through to Hawesville at Midcontinent Independent System Operator ("MISO") pricing plus transmission and other costs. The power supply arrangement with Kenergy has an effective term through December 2023. The arrangement with EDF to act as our market participant with MISO has an effective term through May 2020. Each of these agreements provide for automatic extension on a year-to-year basis unless a one-year notice is given. Sebree Sebree has a power supply arrangement with Kenergy and EDF which provides market-based power to the Sebree smelter. Similar to the arrangement at Hawesville, the power companies purchase power on the open market and pass it through to Sebree at MISO pricing plus transmission and other costs. The power supply arrangement with Kenergy has an effective term through December 2023. The arrangement with EDF to act as our market participant with MISO has an effective term through May 2020. Each of these agreements provides for automatic extension on a year-to-year basis unless a one-year notice is given. Mt. Holly Mt. Holly has a power supply arrangement pursuant to which 25% of the Mt. Holly load is served from the South Carolina Public Service Authority’s ("Santee Cooper") generation at a cost-based industrial rate and 75% of the Mt. Holly load is sourced from a supplier that is outside Santee Cooper’s service territory at market prices that are tied to natural gas prices. The agreement with Santee Cooper has a term through December 31, 2020 and may be terminated by Mt. Holly on 120 days' notice. The agreement with the other power supplier has a term through December 31, 2020 and may be terminated by Mt. Holly on 60 days’ notice. Grundartangi Grundartangi has power purchase agreements for approximately 525 MW with HS Orka hf ("HS"), Landsvirkjun and Orkuveita Reykjavikur ("OR") to provide power to its Grundartangi smelter. These power purchase agreements expire on various dates from 2023 through 2036 (subject to extension). The power purchase agreements with HS and OR both provide power at LME-based variable rates for the duration of these agreements. The power purchase agreement with Landsvirkjun for 161 MW provides power at LME-based variable rates through October 2019 and at rates linked to the Nord Pool power market from November 2019 through the expiration of the agreement on December 31, 2023. Helguvik Nordural Helguvik ehf ("Helguvik") has a power purchase agreement with OR to provide a portion of the power requirements to the Helguvik project. The agreement would provide power at LME-based variable rates and contain take-or-pay obligations with respect to a significant percentage of the total committed and available power under such agreement. The first phase of power under the OR purchase agreement (approximately 47.5 MW) became available in the fourth quarter of 2011 and is currently being utilized at Grundartangi. The agreement contains certain conditions to OR’s obligations with respect to the remaining phases and OR has alleged that certain of these conditions have not been satisfied. We are in discussions with OR with respect to such conditions and other matters pertaining to this agreement. Other Commitments and Contingencies Labor Commitments The bargaining unit employees at our Grundartangi, Vlissingen, Hawesville and Sebree facilities are represented by labor unions, representing approximately 65% of our total workforce. Approximately 85% of Grundartangi’s work force is represented by five labor unions, governed by a labor agreement which is effective through December 31, 2019 that establishes wages and work rules for covered employees. 100% of Vlissingen's work force is represented by the Federation for the Metal and Electrical Industry ("FME") by a labor agreement that is effective through December 1, 2020. Approximately 57% of our U.S. based work force is represented by USW. The labor agreement for Hawesville employees is effective through April 1, 2020. Century Sebree's labor agreement with the USW for its employees is effective through October 28, 2023. Mt. Holly employees are not represented by a labor union. |
Components of Accumulated Other Comprehensive Loss |
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Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of Accumulated Other Comprehensive Loss | Components of Accumulated Other Comprehensive Loss
(1) The allocation of the income tax effect to the components of other comprehensive loss is as follows:
The following table summarizes the changes in the accumulated balances for each component of AOCL:
*ASU 2018-02. See Note 8. Income Taxes for further information regarding our adoption of ASU 2018-02. Reclassifications out of AOCL were included in the consolidated statements of operations as follows:
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Components of Net Periodic Benefit Cost |
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Components of Net Periodic Benefit Cost | Components of Net Periodic Benefit Cost
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Derivatives |
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Derivatives | Derivatives As of March 31, 2019, we had an open position of 66,506 tonnes related to LME forward financial sales contracts, some of which are with Glencore, to fix the forward LME price. These contracts are expected to settle monthly, between November 2019 and December 2024. We also have an open position related to Midwest Premium ("MWP") forward financial sales contracts to fix the forward MWP. As of March 31, 2019, we had an open position of 104,250 tonnes. These contracts are expected to settle monthly through December 2020. We have financial contracts with various counterparties, to offset fixed price sales arrangements with certain of our customers (the “fixed for floating swaps”) to remain exposed to the LME price. As of March 31, 2019, we had open positions related to such arrangements of 12,093 tonnes settling at various dates through May 2020. In 2017, we entered into financial contracts to fix the forward price of approximately 4% of Grundartangi's total power requirements for the period November 2019 through December 2020 (the “power price swaps”). As of March 31, 2019, we had an open position of 256,200 MWh related to the power price swaps. Because the power price swaps are settled in euros, in 2018 we entered into financial contracts to hedge the risk of fluctuations associated with the euro (the "FX swaps"). As of March 31, 2019, we had open positions related to the FX swaps for €5.6 million that settle monthly from November 2019 through December 2020. The following table sets forth the Company's derivative assets and liabilities that were accounted for at fair value and not designated as cashflow hedges as of March 31, 2019 and December 31, 2018:
(1) Commodity contracts reflect our outstanding LME forward financial sales contracts, MWP forward financial sales contracts, fixed for floating swaps, and power price swaps. (2) Foreign exchange contracts reflect our outstanding FX swaps. The following table summarizes the net (loss) gain on forward and derivative contracts for the three months ended March 31, 2019 and 2018:
(3) For the three months ended March 31, 2019 and 2018, $(1.0) million and $0.3 million of the net (loss) gain, respectively, was with Glencore. |
Condensed Consolidating Financial Information |
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Condensed Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Condensed Consolidating Financial Information | Condensed Consolidating Financial Information Our 2021 Notes are guaranteed by each of our material existing and future domestic subsidiaries (The "Guarantor Subsidiaries"), except for Nordural US LLC, Century Aluminum Development LLC and Century Aluminum of West Virginia, Inc. The Guarantor Subsidiaries are 100% owned by Century. All guarantees are full and unconditional; all guarantees are joint and several. These notes are not guaranteed by our foreign subsidiaries (such foreign subsidiaries, Nordural US LLC, Century Aluminum Development LLC and Century Aluminum of West Virginia, Inc., collectively the “Non-Guarantor Subsidiaries”). We allocate corporate expenses or income to our subsidiaries and charge interest on certain intercompany balances. The following summarized condensed consolidating statements of comprehensive income (loss) for the three months ended March 31, 2019 and 2018, condensed consolidating balance sheets as of March 31, 2019 and December 31, 2018 and the condensed consolidating statements of cash flows for the three months ended March 31, 2019 and 2018 present separate results for Century, the Guarantor Subsidiaries, the Non-Guarantor Subsidiaries, consolidating adjustments and total consolidated amounts.
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General (Policies) |
3 Months Ended |
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Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Recently adopted accounting standards | Recently Adopted Accounting Standards On January 1, 2019, we adopted Financial Accounting Standards Board ("FASB") Accounting Standards Update ("ASU") 2016-02, "Leases (Topic 842).” See Note 4. Leases for further information regarding our adoption of ASC 842 and impacts to the financial statements. On January 1, 2019, we adopted FASB ASU 2018-02, “Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income.” See Note 8. Income Taxes for further information regarding our adoption of ASU 2018-02. For the quarter ended March 31, 2019, we have adopted the requirements in SEC Final Rule 33-10532 “Disclosure Updates and Simplification.” The adoption of this guidance resulted in presentation of the Consolidated Statements of Shareholders' Equity as part of our quarterly financial statements. |
Commitments and contingencies | It is our policy to accrue for costs associated with environmental assessments and remedial efforts when it becomes probable that a liability has been incurred and the costs can be reasonably estimated. All accrued amounts have been recorded without giving effect to any possible future recoveries. Costs for ongoing environmental compliance, including maintenance and monitoring are expensed as incurred. |
Related Party Transactions (Tables) |
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Related Party Transactions [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of related party transactions | A summary of the aforementioned significant related party transactions is as follows:
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Revenue (Tables) |
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Revenue Recognition and Deferred Revenue [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disaggregation of revenue | We disaggregate our revenue by geographical region as follows:
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Leases (Tables) |
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Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||
Lessee, Operating Lease, Liability, Maturity | The undiscounted maturities of our operating lease liability balances are as follows (in millions):
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Fair Value Measurements (Tables) |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial assets and liabilities at fair value on a recurring basis |
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Schedule of valuation methodology for assets and liabilities at fair value | The following section describes the valuation techniques and inputs used for fair value measurements categorized within Level 2 or Level 3 of the fair value hierarchy:
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Earnings (Loss) Per Share (Tables) |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basic and diluted earnings (loss) per share | The following table shows the basic and diluted earnings (loss) per share:
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Securities excluded from the calculation of diluted EPS |
(1) In periods when we report a net loss, all share-based compensation awards are excluded from the calculation of diluted weighted average shares outstanding because of their anti-dilutive effect on earnings (loss) per share. |
Shareholders’ Equity (Tables) |
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Stockholders' Equity Note [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Common and Preferred Stock Activity | The Common and Preferred Stock table below contains additional information about preferred stock conversions during the three months ended March 31, 2019 and 2018.
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Inventories (Tables) |
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Inventory, Net [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Inventories |
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Debt (Tables) |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Debt |
(2) The U.S. revolving credit facility is classified as a current liability because we repay amounts outstanding and reborrow funds based on our working capital requirements. Borrowings bear interest at our option of either LIBOR or a base rate, plus, in each case, an applicable interest margin. At March 31, 2019, interest on the base rate portion was 5.75%, and interest on the LIBOR portion was 3.74%. |
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Schedule of Line of Credit Facilities |
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Components of Accumulated Other Comprehensive Loss (Tables) |
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Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated balances for each component of AOCI |
(1) The allocation of the income tax effect to the components of other comprehensive loss is as follows:
The following table summarizes the changes in the accumulated balances for each component of AOCL:
*ASU 2018-02. See Note 8. Income Taxes for further information regarding our adoption of ASU 2018-02. |
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Reclassification out of AOCI | Reclassifications out of AOCL were included in the consolidated statements of operations as follows:
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Components of Net Periodic Benefit Cost (Tables) |
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Components of net periodic benefit cost [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of net periodic benefit cost |
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Derivatives (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivatives Not Designated as Hedging Instruments | The following table sets forth the Company's derivative assets and liabilities that were accounted for at fair value and not designated as cashflow hedges as of March 31, 2019 and December 31, 2018:
(1) Commodity contracts reflect our outstanding LME forward financial sales contracts, MWP forward financial sales contracts, fixed for floating swaps, and power price swaps. (2) Foreign exchange contracts reflect our outstanding FX swaps. |
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Schedule of Derivative Instruments | The following table summarizes the net (loss) gain on forward and derivative contracts for the three months ended March 31, 2019 and 2018:
(3) For the three months ended March 31, 2019 and 2018, $(1.0) million and $0.3 million of the net (loss) gain, respectively, was with Glencore. |
Condensed Consolidating Financial Information (Tables) |
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Condensed Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Condensed Consolidating Statements of Comprehensive Income (Loss) |
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Condensed Consolidating Balance Sheet |
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Condensed Consolidating Statement of Cash Flows |
|
Related Party Transactions - Narrative (Details) $ in Millions |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2019
USD ($)
T
|
Mar. 31, 2018
USD ($)
|
Apr. 29, 2019
USD ($)
|
|
Related Party Transaction [Line Items] | |||
Ownership percentage by noncontrolling owners | 42.90% | ||
Economic ownership percentage by related party | 47.00% | ||
Related parties | $ 311.3 | $ 296.2 | |
BHH [Member] | |||
Related Party Transaction [Line Items] | |||
Ownership percentage | 40.00% | ||
Glencore [Member] | |||
Related Party Transaction [Line Items] | |||
Related parties | $ 311.3 | $ 296.2 | |
Consolidated Sales [Member] | Customer Concentration Risk [Member] | Glencore [Member] | |||
Related Party Transaction [Line Items] | |||
Major customer, percentage of revenue, net (percent) | 64.00% | 65.00% | |
Subsequent Event [Member] | Glencore [Member] | |||
Related Party Transaction [Line Items] | |||
Due to related parties, noncurrent | $ 40.0 | ||
Aluminum [Member] | Glencore [Member] | |||
Related Party Transaction [Line Items] | |||
Related parties | $ 8.2 | ||
Number of metric tonnes | T | 21,865 |
Related Party Transactions - Summary of related party transactions (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Related Party Transaction [Line Items] | ||
Net sales to Glencore | $ 311.3 | $ 296.2 |
Glencore [Member] | ||
Related Party Transaction [Line Items] | ||
Net sales to Glencore | 311.3 | 296.2 |
Purchases from Glencore | 90.7 | 48.4 |
BHH [Member] | ||
Related Party Transaction [Line Items] | ||
Purchases from BHH | $ 6.1 | $ 7.4 |
Revenue (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 490.0 | $ 454.5 |
Increase in accounts receivable | 6.0 | |
United States [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 325.2 | 268.2 |
Iceland [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 164.8 | $ 186.3 |
Leases (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Dec. 31, 2018 |
|
Leases [Abstract] | ||
Leases - right of use assets | $ 24.6 | $ 0.0 |
Leases - right of use liabilities, current | 2.0 | |
Leases - right of use liabilities, noncurrent | $ 22.8 | $ 0.0 |
Operating lease, weighted average remaining lease term | 15 years | |
Operating lease, weighted average discount rate, percent | 7.30% | |
Operating lease, expense | $ 2.2 | |
Short-term lease, cost | 1.2 | |
Operating lease, payments | $ 1.0 |
Leases - Maturities (Details) $ in Millions |
Mar. 31, 2019
USD ($)
|
---|---|
Leases [Abstract] | |
2019 | $ 1.4 |
2020 | 0.5 |
2021 | 0.4 |
2022 | 0.1 |
2023 | 0.2 |
Thereafter | 40.8 |
Total | 43.4 |
Less: Interest | (18.6) |
ROUL | $ 24.8 |
Earnings (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Earnings Per Share [Abstract] | ||
Net income (loss) | $ (34.6) | $ (0.3) |
Amount allocated to common stockholders (as percent) | 100.00% | 100.00% |
Basic EPS: | ||
Basic and Diluted EPS | $ (34.6) | $ (0.3) |
Net income (loss) allocated to common stockholders (shares) | 88.1 | 87.6 |
Basic and diluted (per share) | $ (0.39) | $ 0.00 |
Securities excluded from calculation of diluted EPS (shares) | 0.6 | 1.4 |
Income Taxes (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Income Tax Disclosure [Abstract] | ||
Income tax benefit (expense) | $ 2.9 | $ 1.0 |
Tax cuts and jobs act, reclassification from aoci to retained earnings, tax effect | $ 1.3 |
Inventories (Details) - USD ($) $ in Millions |
Mar. 31, 2019 |
Dec. 31, 2018 |
---|---|---|
Inventory, Net [Abstract] | ||
Raw materials | $ 93.9 | $ 100.8 |
Work-in-process | 50.0 | 49.5 |
Finished goods | 35.9 | 47.3 |
Operating and other supplies | 147.6 | 146.2 |
Total inventories | $ 327.4 | $ 343.8 |
Components of Net Periodic Benefit Cost (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Pension Benefits [Member] | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Service cost | $ 1.1 | $ 1.1 |
Interest cost | 3.3 | 3.1 |
Expected return on plan assets | (4.9) | (5.3) |
Amortization of prior service costs | 0.0 | 0.0 |
Amortization of net loss | 1.1 | 1.5 |
Net periodic benefit cost | 0.6 | 0.4 |
Other Postretirement Benefits [Member] | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Service cost | 0.0 | 0.1 |
Interest cost | 1.0 | 1.1 |
Amortization of prior service costs | (1.3) | (1.8) |
Amortization of net loss | 0.8 | 1.1 |
Net periodic benefit cost | $ 0.5 | $ 0.5 |
Derivatives (Details) € in Millions |
3 Months Ended | 12 Months Ended |
---|---|---|
Mar. 31, 2019
EUR (€)
MWh
t
|
Dec. 31, 2017 |
|
LME Swap [Member] | ||
Derivative [Line Items] | ||
Other forward delivery contracts to sell primary aluminum (in tonnes) | 66,506 | |
Midwest Premium (MWP) [Member] | ||
Derivative [Line Items] | ||
Open position to offset fixed prices | 104,250 | |
Price Swap [Member] | ||
Derivative [Line Items] | ||
Open position to offset fixed prices | 12,093 | |
Power Price Swap [Member] | Grundartangi [Member] | ||
Derivative [Line Items] | ||
Percentage of power purchases included in forward price contract (percent) | 4.00% | |
Power available | MWh | 256,200 | |
FX Swap [Member] | ||
Derivative [Line Items] | ||
Derivative asset | € | € 5.6 |
Derivatives Assets and Liabilities (Details) - Not Designated as Hedging Instrument [Member] - USD ($) $ in Millions |
Mar. 31, 2019 |
Dec. 31, 2018 |
---|---|---|
Derivative [Line Items] | ||
Derivative asset | $ 8.9 | $ 8.2 |
Derivative liability | 8.8 | 2.5 |
Commodity Contract [Member] | ||
Derivative [Line Items] | ||
Derivative asset | 8.9 | 8.2 |
Derivative liability | 8.3 | 2.2 |
Foreign Exchange Contract [Member] | ||
Derivative [Line Items] | ||
Derivative asset | 0.0 | 0.0 |
Derivative liability | $ 0.5 | $ 0.3 |
Derivatives Net Gain (Loss) (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Derivative [Line Items] | ||
Derivative, (loss) gain on derivative, net | $ (5.7) | $ 0.7 |
Commodity Contract [Member] | ||
Derivative [Line Items] | ||
Derivative, (loss) gain on derivative, net | (5.5) | 0.7 |
Commodity Contract [Member] | Glencore [Member] | ||
Derivative [Line Items] | ||
Derivative, (loss) gain on derivative, net | (1.0) | 0.3 |
Foreign Exchange Contract [Member] | ||
Derivative [Line Items] | ||
Derivative, (loss) gain on derivative, net | $ (0.2) | $ 0.0 |
Label | Element | Value | ||
---|---|---|---|---|
Retained Earnings [Member] | ||||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 1,300,000 | ||
AOCI Attributable to Parent [Member] | ||||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ (1,300,000) | ||
|
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