Century Aluminum Company (CENX) Q2 2024 earnings summary

Executive summary

• Q2 2024 net sales reached $561 million, up sequentially, driven by higher aluminum prices and product premiums, while adjusted EBITDA rose to $34.2 million and liquidity improved to $343 million, the highest in nearly a decade.

• Net loss attributable to stockholders was $2.5 million for Q2 2024, with adjusted net income of $1 million or $0.01 per share, reflecting adjustments for non-recurring items.

• Jamalco acquisition stabilized costs amid tight alumina supply, contributed to a $245.9 million bargain purchase gain in H1 2024, and operations quickly recovered after Hurricane Beryl.

• U.S. and EU trade actions, including new tariffs and anti-dumping duties, are supporting domestic demand and pricing, enhancing the value of North American and European production assets.

• U.S. and Iceland smelters are operating at or near full capacity, with Grundartangi returning to full production after energy curtailment and new Natur-Al green billet trials ongoing.

Financial highlights

• Q2 2024 net sales were $561 million, up from $490 million in Q1, with aluminum shipments of 167,908 tonnes, down from 174,627 tonnes in Q1.

• Adjusted EBITDA increased to $34.2 million in Q2 from $25 million in Q1, mainly from higher price premiums.

• Realized LME aluminum price was $2,288/ton, U.S. Midwest premium $416/ton, and European premium $284/ton, all up sequentially.

• Gross margin for Q2 2024 was $20.4 million, up from $15.9 million in Q2 2023.

• Liquidity at June 30, 2024 was $343 million, including $41.3 million in cash and $302 million available on credit facilities.

Outlook and guidance

• Q3 2024 Adjusted EBITDA is projected between $65 million and $75 million, with higher LME and regional premiums expected to add $30–$40 million sequentially.

• Q3 guidance assumes LME at $2,440/MT, US Midwest premium at $425/MT, and European premium at $320/MT.

• FY24 aluminum shipment guidance is 700,000 MT; sustaining capex expected at $10–$15 million, Jamalco capex at $10–$15 million.

• Power prices expected to be a $5 million headwind; shipment timing to provide a $10 million tailwind.

• The company plans to build a new U.S. aluminum smelter with up to $500 million in DOE funding.