Century Aluminum shifts from net loss in 2016 to improved net income in the full year 2017

Century Aluminum Company today announced fourth quarter and full year 2017 results.

Q4 2017 Highlights                               

Century Aluminum Company reported net income of $35.8 million for Q42017 in comparison to the net income of $20.8 million for the third quarter of 2017. Results were favourably driven by a $7.3 million non-cash gain. Adjusted net income for Q42017was $24.8 million compared to adjusted net income of $14.4 million for the third quarter of 2017.

Century reported adjusted EBITDA of $60.2 million in Q42017, up $12.3 million from the third quarter of 2017, primarily driven by higher LME prices, partially offset by higher raw material costs.

Sales for Q42017 were $433.8 million compared with $400.6 million for the third quarter of 2017.  Primary aluminium shipments stood at 189,000 tonnes compared with 184,974 tonnes shipped in the third quarter of 2017.

Century reported a net cash position of $167.2 million at the quarter end.

Full Year 2017

For the full year 2017, Century reported a net income of $48.6 million driven positively by $13.9 million in non-cash gains compared to a net loss of $252.4 million in 2016.  Results were favourably impacted lower cost or NRV inventory adjustment.  Results were negatively impacted by $179.0 million in non-cash charges and tax charges.

Total sales for 2017 were $1,589.1 million compared with $1,319.1 million in 2016.  Shipments of primary aluminium for 2017 were 743,198 tonnes compared with 733,825 tonnes shipped in 2016.

Commenting on the results, Michael Bless, President and Chief Executive Officer said, “Stable operations, favorable operating metrics and tight controllable cost management contributed to what we believe was a very good quarter.”

“As we had forecast, higher raw material costs impacted our results; this factor will carry over to the first quarter… We are thus entering 2018 with a good handle on our controllable costs and an improving raw material environment.”

Bless continued, “Industry conditions continue to be volatile and complex.  Western world demand for primary aluminium and aluminium products remains quite good; we see this environment continuing for the foreseeable future, barring of course the impact of any significant global macroeconomic shock.”

He expressed his doubts over the efforts at supply discipline in China and said that it finally led to a deteriorating demand environment.  He forecasted another record year of exports from China which would flood the U.S. market again. He said he was optimistic about Trump administration’s future actions  intended to correct this situation.

“We are optimistic as we look toward the coming year,” concluded Bless.  “We are implementing modest investments in upgrading our product mix across the plants.  We will need to make certain investments at Hawesville and Mt. Holly in order to maintain production at current levels; this spending, principally in the rebuilding of failed cells, has been deferred since we curtailed production in late 2015,” he added.

He indicated the restart of operations at Hawesville and reiterated his belief in his company’s ability to serve customers in a rational market environment and generate attractive returns for its shareholders.