EXHIBIT 99.1
NEWS RELEASE
[CENTURY ALUMINUM LOGO]
CENTURY REPORTS RECORD OPERATING INCOME FOR SECOND QUARTER
Monterey, CA, July 28, 2004 - Century Aluminum Company (NASDAQ: CENX)
reported net income of $18.3 million, or $0.60 a common share, fully diluted,
for the second quarter of 2004. For the second quarter of 2003, the company
reported a net loss of $5.0 million, or $0.26 a share after preferred dividends.
QUARTERLY AND YEAR-TO-DATE HIGHLIGHTS:
- Operating income in the recent quarter rose to a quarterly record of
$41.2 million, an 11-fold increase over $3.7 million in the year-ago
quarter; operating income in the first six months of 2004 rose to a
six-month record of $72.8 million, a 10-fold increase over $7.3
million in the year-ago period
- Sales were a quarterly record of $263.7 and a six-month record of
$495.8 million
- Aluminum shipments were a quarterly record 294.8 million pounds and
a six-month record 591.6 million pounds
- Price realizations were the highest in nine years
- Acquisition of Nordural hf in Iceland was completed; construction
began on a project to double the capacity of the plant to 180,000
metric tonnes per year by mid-2006.
Sales in the second quarter of 2004 were $263.7 million compared with
$196.2 million in the second quarter of 2003. Direct shipments of primary
aluminum in the 2004 quarter were 294.8 million pounds compared with 290.0
million pounds in the 2003 quarter.
Net income for the first six months of 2004 was $23.1 million, or $0.87 a
share, fully diluted. This compares with a net income of $12.6 million, or $0.56
a share, fully diluted, in the year-ago period.
Sales in the first six months of 2004 were $495.8 million compared with
$375.2 million in the same period of 2003. Direct shipments of primary aluminum
for the 2004 period were 591.6 million pounds compared with 547.1 million pounds
in the year-ago period.
Financial results for the second quarter of 2004 include Nordural hf from
April 27, 2004, the date of acquisition.
Commenting on the company's performance, Craig A. Davis, Century Chairman
and Chief Executive Officer, said:
"Favorable market conditions, very strong aluminum prices and the first
benefits of our Nordural acquisition combined to produce an outstanding quarter
for our company. The company's overall financial performance was at record
levels."
Century owns 615,000 mtpy of primary aluminum capacity. The company owns
and operates a 244,000-mtpy plant at Hawesville, KY, a 170,000-mtpy plant at
Ravenswood, WV and a 90,000-mtpy plant at Grundartangi, Iceland. Century also
owns a 49.67-percent interest in a 222,000-mtpy reduction plant at Mt. Holly,
SC. Alcoa Inc. owns the remainder and is the operating partner. Century's
corporate offices are located in Monterey, CA.
This press release may contain "forward-looking statements" within the
meaning of U.S. federal securities laws. Century has based its forward-looking
statements on current expectations and projections about the future, however
these statements are subject to risks, uncertainties and assumptions, any of
which could cause Century's actual results to differ materially from those
expressed in its forward-looking statements. More information about these risks,
uncertainties and assumptions can be found in the risk factors and
forward-looking statements cautionary language contained in Century's filings
with the Securities and Exchange Commission. Century does not undertake, and
specifically disclaims, any obligation to revise any forward-looking statements
to reflect the occurrence of anticipated or unanticipated events or
circumstances after the date such forward-looking statements are made.
Editorial contact: A. T. Posti (831) 642-9364
CENTURY ALUMINUM COMPANY
CONSOLIDATED STATEMENTS OF OPERATIONS
(in Thousands, Except Per Share Amounts)
(Unaudited)
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
-------- --------
2004 2003 2004 2003
---- ---- ---- ----
NET SALES:
Third-party customers ................................................ $ 225,430 $ 163,746 $ 417,776 $ 317,201
Related parties ...................................................... 38,303 32,421 78,051 57,975
--------- --------- --------- ---------
263,733 196,167 495,827 375,176
COST OF GOODS SOLD ...................................................... 218,542 188,391 413,587 359,694
--------- --------- --------- ---------
GROSS PROFIT ............................................................ 45,191 7,776 82,240 15,482
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES ............................ 3,991 4,086 9,399 8,221
--------- --------- --------- ---------
OPERATING INCOME ........................................................ 41,200 3,690 72,841 7,261
INTEREST INCOME (EXPENSE) - Net ......................................... (11,281) (11,285) (21,888) (21,358)
NET GAIN (LOSS) ON FORWARD CONTRACTS .................................... (1,177) 211 (13,997) 41,904
OTHER INCOME (EXPENSE) .................................................. 9 (770) (605) (500)
--------- --------- --------- ---------
INCOME (LOSS) BEFORE INCOME TAXES ....................................... 28,751 (8,154) 36,351 27,307
INCOME TAX (EXPENSE) BENEFIT ............................................ (10,463) 3,147 (13,263) (9,827)
--------- --------- --------- ---------
INCOME (LOSS) BEFORE MINORITY INTEREST AND
CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE .................. 18,288 (5,007) 23,088 17,480
MINORITY INTEREST ....................................................... -- -- -- 986
--------- --------- --------- ---------
INCOME (LOSS) BEFORE CUMULATIVE EFFECT OF
CHANGE IN ACCOUNTING PRINCIPLE ....................................... 18,288 (5,007) 23,088 18,466
CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING
PRINCIPLE, NET OF TAX BENEFIT OF $3.4 MILLION ........................ -- -- -- (5,878)
--------- --------- --------- ---------
NET INCOME (LOSS) ....................................................... 18,288 (5,007) 23,088 12,588
PREFERRED DIVIDENDS ..................................................... (269) (500) (769) (1,000)
--------- --------- --------- ---------
NET INCOME (LOSS) APPLICABLE TO COMMON SHAREHOLDERS ..................... $ 18,019 $ (5,507) $ 22,319 $ 11,588
========= ========= ========= =========
EARNINGS (LOSS) PER COMMON SHARE
Basic - Before cumulative effect of change in accounting principle ... $ 0.61 $ (0.26) $ 0.88 $ 0.83
Basic - Cumulative effect of change in accounting principle .......... $ -- $ -- $ -- $ (0.28)
--------- --------- --------- ---------
Basic - Net income (loss) ............................................ $ 0.61 $ (0.26) $ 0.88 $ 0.55
========= ========= ========= =========
Diluted - Before cumulative effect of change in accounting principle . $ 0.60 $ (0.26) $ 0.87 $ 0.82
Diluted - Cumulative effect of change in accounting principle ........ $ -- $ -- $ -- $ (0.26)
--------- --------- --------- ---------
Diluted - Net income (loss) .......................................... $ 0.60 $ (0.26) $ 0.87 $ 0.56
========= ========= ========= =========
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
Basic ................................................................ 29,629 21,070 25,412 21,070
Diluted .............................................................. 30,542 21,070 25,588 22,465
CENTURY ALUMINUM COMPANY
CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands)
(Unaudited)
JUNE 30, DECEMBER 31,
ASSETS 2004 2003
---- ----
CURRENT ASSETS:
Cash ................................................................ $ 75,169 $ 28,204
Restricted cash ..................................................... 8,500 --
Accounts receivable - net ........................................... 68,399 51,370
Due from affiliates ................................................. 12,016 10,957
Inventories ......................................................... 104,321 89,360
Prepaid and other assets ............................................ 9,648 4,101
Deferred taxes - current portion .................................... 6,133 3,413
----------- -----------
Total current assets ............................................. 284,186 187,405
Property, Plant and Equipment - Net .................................... 743,614 494,957
Intangible Asset - Net ................................................. 92,972 99,136
Goodwill ............................................................... 107,259 --
Other Assets ........................................................... 32,502 28,828
----------- -----------
Total ............................................................... $ 1,260,533 $ 810,326
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable, trade ............................................. $ 43,583 $ 34,829
Due to affiliates ................................................... 32,657 27,139
Industrial revenue bonds ............................................ 7,815 7,815
Long term debt - current portion .................................... 13,460 --
Accrued and other current liabilities ............................... 46,401 30,154
Accrued employee benefits costs - current portion ................... 8,296 8,934
----------- -----------
Total current liabilities ........................................ 152,212 108,871
Senior Secured Notes Payable - Net ..................................... 322,561 322,310
Nordural Debt .......................................................... 170,472 --
Note Payable - Affiliates .............................................. -- 14,000
Accrued Pension Benefit Costs - Less current portion ................... 11,584 10,764
Accrued Postretirement Benefits Costs - Less current portion ........... 83,411 78,218
Other Liabilities ...................................................... 35,200 33,372
Due to Affiliates - Less current portion ............................... 7,107 --
Deferred Taxes ......................................................... 68,310 55,094
----------- -----------
Total noncurrent liabilities ..................................... 698,645 513,758
SHAREHOLDERS' EQUITY:
Convertible Preferred Stock (8.0% cumulative, 0 and 500,000 shares
outstanding at June 30, 2004 and December 31, 2003, respectively) -- 25,000
Common Stock (one cent par value, 50,000,000 shares authorized;
31,681,883 shares outstanding at June 30, 2004 and 21,130,839 at
December 31, 2003) ............................................... 317 211
Additional Paid-In Capital .......................................... 409,568 173,138
Other Comprehensive Income (Loss) ................................... (14,556) (5,222)
Retained Earnings (Accumulated Deficit) ............................. 14,347 (5,430)
----------- -----------
Total shareholders' equity ....................................... 409,676 187,697
----------- -----------
Total ............................................................ $ 1,260,533 $ 810,326
=========== ===========
CENTURY ALUMINUM COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOW
(Dollars in Thousands)
(Unaudited)
SIX MONTHS ENDED
JUNE 30,
--------
2004 2003
---- ----
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income .................................................. $ 23,088 $ 12,588
Adjustments to reconcile net income to net cash provided by
operating activities:
Unrealized (Gain) Loss on forward contracts ........... 6,659 (12,292)
Depreciation and amortization ......................... 23,731 25,787
Deferred income taxes ................................. 4,926 6,396
Pension and other postretirement benefits ............. 5,376 5,897
Inventory market adjustment ........................... (2,273) (394)
Loss on disposal of assets ............................ 695 836
Minority Interest ..................................... -- (986)
Cumulative effect of change in accounting principle ... -- 9,308
Change in operating assets and liabilities:
Accounts receivable - net .......................... (8,264) (4,178)
Due from affiliates ................................ (1,059) (4,604)
Inventories ........................................ (703) 5,734
Prepaids and other assets .......................... (2,724) (2,733)
Accounts payable, trade ............................ (1,294) (3,184)
Due to affiliates .................................. (3,383) 1,394
Accrued and other current liabilities .............. 9,308 632
Other - net ........................................ (2,472) 9,527
--------- ---------
Net cash provided by operating activities ............. 51,611 49,728
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property, plant and equipment ................... (5,712) (10,300)
Acquisitions ................................................ (184,869) (59,837)
--------- ---------
Net cash used in investing activities .................... (190,581) (70,137)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of debt ........................................... (20,659) --
Financing fees .............................................. -- (297)
Dividends ................................................... (3,311) (11)
Issuance of common stock .................................... 209,905 --
--------- ---------
Net cash provided (used) in financing activities ......... 185,935 (308)
NET INCREASE (DECREASE) IN CASH ................................ 46,965 (20,717)
CASH, BEGINNING OF PERIOD ...................................... 28,204 45,092
--------- ---------
CASH, END OF PERIOD ............................................ $ 75,169 $ 24,375
========= =========
CENTURY ALUMINUM COMPANY
SELECTED OPERATING DATA
(in Thousands, Except Dollars per Pound)
(Unaudited)
SHIPMENTS - PRIMARY ALUMINUM
Direct (1) Toll
---------- ----
Pounds $/Pound Pounds Revenue
------ ------- ------ -------
2004
2nd Quarter 294,816 $ 0.82 35,600 $ 21,483
1st Quarter 296,743 $ 0.78 -- $ --
2003
2nd Quarter 290,023 $ 0.68 -- $ --
1st Quarter 257,040 $ 0.70 -- $ --
(1) Does not include Toll shipments from Nordural