Net income up for Century Aluminum, progress on US projects

Century Aluminum reported that net income soared in the company’s first quarter, due largely to its $246 million purchase gain from last year’s acquisition of the Jamalco alumina refinery in Jamaica.

The Chicago-headquartered company said net income reached $247 million in the quarter ended March 31, up from $30 million in the previous quarter.

Total shipments clocked in at 174,627 tonnes, up from 173,871/t in the previous quarter.

Executives told analysts they expect that pending antidumping and countervailing duty trade cases against extrusion imports “will have a significant positive impact on domestic U.S. billet demand beginning in the second half of this year.”

“In March, the Department of Commerce granted U.S. extruders an early victory by imposing preliminary duties of the subsidy portion of the case,” said Jesse Gary, president and CEO.

“And in May, we continue to believe that commerce will also impose additional antidumping duties on 14 countries,” Gary continued. “If so, the duties would go immediately into effect and are expected to add strong support to the U.S. extrusion and billet markets. As a reminder, we did hold back some second half billet volumes for spot sales in anticipation of improving U.S. market conditions and a more constructive pricing environment.”

The company reported net sales of $489.5 million, down from $512.3 million in the previous quarter.

“Market conditions remain broadly balanced in the first quarter before an improving demand picture in the U.S. and Europe paired with continued strong demand in China drove LME prices substantially higher in April,” Gary said. “This pickup in demand was evident in regional premiums as well with the European premium increasing most notably over the course of the quarter to be up nearly 50% from year-end levels.”

Still, global inventories remain at “post-financial crisis lows” with the majority of metal around the world comprised of Russian stocks.

Century is making a big investment in secondary aluminum production with the announcement of its joint venture with MX Holdings to build a low-carbon 250 million-pound secondary billet casthouse in the Ohio Valley region.

Final investment decisions for the project are expected in the third quarter. It is planned to be completed in 2026.

Recall that Century also recently announced $500 million in funding from the Department of Energy to build a green aluminum smelter within the Ohio and Mississippi River Basins.

There has not been a new smelter built in the U.S. since Mt. Holly was built in 1980.

“Looking at primary versus secondary growth, we think there will be growth in both,” Gary said. “There are many applications that do require primary. And so we think that’s a good driver here for the primary smelter. And then there’s also demand growth and additional calls for secondary aluminum and its recycled nature and green credentials.”