Century Aluminum Company · NASDAQ:CENX
Century Aluminum — Q4 2018 Earnings Presentation
23 slides from Century Aluminum's earnings presentation, Feb 21, 2019
Slide 1: Century Aluminum 4th Quarter Earnings Call
Century Aluminum 4th Quarter Earnings Call February 21, 2019
Slide 2: Cautionary Statement
Cautionary Statement This presentation and comments made by Century Aluminum management on the quarterly conference call contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the S
Slide 3: Speakers
Speakers • Mike Bless, President and Chief Executive Officer • Craig Conti, Executive Vice President and Chief Financial Officer • Shelly Harrison, Senior Vice President, Finance and Treasurer • Peter Trpkovski, Manager, Finance 2
Slide 4: Overview
Overview • Stable operations and strong safety performance • Hawesville restart on schedule and budget • Two-year extension to Mt. Holly power contract secured • Investing in growth and value-added capacity of U.S. plants • Trade remedy remains in place and accomplishing objectives 3
Slide 5: Industry Environment
Industry Environment 1) Source: CRU Group, Century Aluminum Company 4
Slide 6: Q4 2018 vs. Q3 2018 Operations
Q4 2018 vs. Q3 2018 Operations Hawesville Sebree Mt. Holly Grundartangi Safety Production(1) 31% 18% 0% 0% KPIs Flat Flat Controllable cost(2) -8% -28% 11% -7% 1) Production on a tonnes per day basis 2) Excludes raw materials and casting 5
Slide 7: Q4 2018 Summary Results
Q4 2018 Summary Results ($MM, except per share and tonne amounts) Q318 Q418 Income statement Shipments (tonnes) 182,926 199,466 Net sales $ 482 $ 487 Net income/(loss) (20) (65) Diluted earnings/(loss) per share (0.23) (0.74) (1) Adjusted net income/(loss) 2 (41) (1) Adjusted earnings / (loss) per s
Slide 8: Q4 2018 Adjusted EBITDA
Q4 2018 Adjusted EBITDA(1) 1) See reconciliation to comparable GAAP financial measure in appendix 7
Slide 9: Q4 2018 Cash Flow
Q4 2018 Cash Flow 1) See reconciliation to comparable GAAP financial measure in appendix 8
Slide 10: FY 2018 Summary
FY 2018 Summary • Trade actions leveled playing field for US producers • Commenced restart of 3 curtailed lines at Hawesville that had been idle since 2015 o Project expected to conclude on budget/schedule in early 2019 • Reached new 5-year labor agreement at Sebree • Alumina supply outages sent pri
Slide 11: 2019 Items – Price Assumptions
2019 Items – Price Assumptions Assumptions Units Q1 2019 Q2-Q4 2019 Midwest Premium ($/T) 410 410 European Duty Paid Premium ($/T) 125 120 Alumina Price Index ($/T) 500 350 MISO Indiana Hub ($/MWh) 32.00 30.50 NYMEX Henry Hub Nat Gas ($/MMBtu) 2.95 2.90 Coke(1) ($/T) 410 390 Pitch(1) ($/T) 850 850 1
Slide 12: 2019 Items
2019 Items Hawesville - ~195K tonnes Sebree - ~220K tonnes Shipments Mt. Holly - ~115K tonnes Iceland - ~320K tonnes U.S. Standard - Midwest Transaction with ~2 month lag (1) Pricing Iceland Standard - LME plus European Duty Paid premium with 2 month lag Value Added Products - ~$200/T over LME plus
Slide 13: 2019 Items (cont.)
2019 Items (cont.) Book - ~$41MM SG&A Cash - ~$33MM Book - ~$22MM Interest, net Cash - ~$21MM Maintenance - $10-15MM Capex Investment - $20-25MM Depreciation $85-95MM U.S. - book/cash < $1MM Income tax Iceland - book - 20%; < $1MM cash income tax payment Cash flow break-even (1) Q2-Q4: ~$1,800/T 1)
Slide 14: Appendix
Centuryauminum
Slide 15: Non-GAAP Financial Measures
Non-GAAP Financial Measures Adjusted EBITDA, adjusted net income / (loss) and adjusted earnings / (loss) per share and net debt are non-GAAP financial measures that management uses to evaluate Century's financial performance. These non-GAAP financial measures facilitate comparisons of this period’s
Slide 16: Adjusted Net Income/(Loss) Non-GAAP Reconciliation
Adjusted Net Income/(Loss) Non-GAAP Reconciliation Q318 Q418 $MM EPS $MM EPS Net loss as reported $(20.3) $ (0.23) $(65.0) $ (0.74) Lower of cost or NRV inventory adjustment, net of tax 9.2 0.10 29.1 0.33 Helguvik (gains) (4.5) (0.05) - - Sebree equipment failure 16.9 0.19 (4.3) (0.05) Sebree signin
Slide 17: Adjusted FY Net Income/(Loss) Non-GAAP Reconciliation
Adjusted FY Net Income/(Loss) Non-GAAP Reconciliation 2017 2018 $MM EPS $MM EPS Net income/(loss) as reported $ 48.6 $ 0.51 $ (66.2) $ (0.76) Lower of cost or NRV inventory adjustment, net of tax (1.1) (0.01) 35.0 0.40 Net (gain) on forward and derivative contracts - - (5.1) (0.06) Helguvik (gains)
Slide 18: Adjusted EBITDA Non-GAAP Reconciliation
Adjusted EBITDA Non-GAAP Reconciliation ($MM) Q318 Q418 Net loss as reported $ (20.3) $ (65.0) Interest expense 5.6 5.7 Interest income (0.4) (0.2) Net (gain) on forward and derivative contracts (0.8) (3.6) Other (income) - net (0.7) (1.1) Income tax expense/(benefit) 1.7 (3.2) Equity in earnings of
Slide 19: Adjusted FY EBITDA Non-GAAP Reconciliation
Adjusted FY EBITDA Non-GAAP Reconciliation ($MM) 2017(1) 2018 Net income/(loss) as reported $ 48.6 $ (66.2) Interest expense 22.2 22.4 Interest income (1.4) (1.5) Net (gain)/loss on forward and derivative contracts 16.5 (6.3) Other (income)/expense - net 4.5 (3.0) Income tax expense/(benefit) 7.6 (0
Slide 20: Reconciliation to 2019 Net Plant Cash Costs
Reconciliation to 2019 Net Plant Cash Costs Q1 ($/T) U.S. Iceland Plant operating cash costs ($/T) $ 2,615 $ 2,665 $ 2,125 $ 2,175 Regional premium (410) (410) (125) (125) Value-added product premium, net (1) (80) (80) (20) (20) Net plant operating cash costs ($/T) $ 2,125 $ 2,175 $ 1,980 $ 2,030 Q2
Slide 21: 2019 Sensitivities
2019 Sensitivities ($MM) Variance Annual EBITDA(6) LME +/- $100/T $ 76 MWP(1) +/- $0.01/lb 8 EDPP(2) +/- $22.04/T 7 MISO Indiana Hub(3) +/- $1/MWh 6 NYMEX Henry Hub Nat Gas (4) +/- $0.10/MMBtu 1 Alumina Price Index +/- $10/T 14 Coke(5) +/- $10/T 3 Pitch(5) +/- $10/T 1 1) Midwest Premium for all U.S.
Slide 22: For Additional Information
For Additional Information Peter Trpkovski peter.trpkovski@centuryaluminum.com 312-696-3112 (Office) Century Aluminum Company One South Wacker Dr, Suite 1000 Chicago, IL 60606 312-696-3102 (Fax) www.centuryaluminum.com 21
Slide 23: CenturyAuminu
CenturyAuminu Centuryawminum
Century Aluminum Company — Q4 2018 Earnings Presentation on 6ix