CENTURY ALUMINUM Releases Fourth Quarter FY2022 Earnings Results on February 23, 2023

Earnings Overview

CENTURY ALUMINUM ($NASDAQ:CENX) reported their earnings results for the 4th quarter of FY2022, ending on December 31 2022, on February 23 2023. Total revenue for the quarter had decreased by 287.9%, amounting to USD -113.5 million compared to the same quarter the year prior. Net income decreased by 19.6% to USD 529.9 million in the fourth quarter of FY2022 from the same quarter in the previous year.

Transcripts Simplified

In the fourth quarter, global shipments were down about 2% quarter-over-quarter, resulting in a decrease in net sales of 60%. Adjusted EBITDA was at a $12 million loss, an improvement of $24 million compared with the third quarter. The major adjusting items were $82.9 million for the unrealized impacts of forward contracts, $5.4 million related to the excess power capacity charges associated with the Hawesville smelter, and $2.2 million in share-based compensation. In Q1, lagged LME of $2,350 per ton is expected to be up about $45 versus Q4 realized prices.

The U.S. Midwest premium is forecast to be $560 per ton up $90 and the European delivery premium is expected at $275 per tonne are down about $225 per tonne versus the fourth quarter. CapEx spending totaled $17 million, $13 million which relates to the Grundartangi casthouse project. Semiannual interest payments were $11 million, and hedge settlements, net borrowing and working capital have contributed $13 million, $12 million and $5 million respectively.

About the Company

Income Snapshot

Below shows the total revenue, net income and net margin for Century Aluminum. More…

Cash Flow Snapshot

Below shows the cash from operations, investing and financing for Century Aluminum. More…

Balance Sheet Snapshot

Below shows the total assets, liabilities and book value per share for Century Aluminum. More…

Key Ratios Snapshot

Some of the financial key ratios for Century Aluminum are shown below. More…

Stock Price

On Thursday, February 23, 2023, CENTURY ALUMINUM released their fourth quarter Fiscal Year 2022 earnings results. The stock opened at $10.4 and closed at $10.4, down 0.7% from the previous close of $10.4. The company also announced plans to increase investments in its aluminum smelting operations and expand its foothold in the global market.

CENTURY ALUMINUM’s strong performance in the fourth quarter and the positive outlook for the upcoming fiscal year has encouraged investors, who have shown confidence by increasing their holdings of the company’s shares. This is an indication that CENTURY ALUMINUM is well-positioned to capitalize on current market trends and benefit from increased demand over the long term. Live Quote…

Analysis

GoodWhale has undertaken an analysis of CENTURY ALUMINUM‘s financial health and wellbeing. We used our Star Chart to assess the company’s performance in areas such as cashflows and debt, and found that CENTURY ALUMINUM had an intermediate score of 4/10. This indicates that the company is likely to be able to ride out any crisis without any risk of bankruptcy. We also classified CENTURY ALUMINUM as a “cheetah” – a type of company which has achieved high revenue or earnings growth, but is considered less stable due to lower profitability. The Star Chart showed that the company was strong in liquidity, medium in assets, growth, profitability, and weak in dividends. This suggests that CENTURY ALUMINUM may be attractive to investors who are looking for a company with good growth prospects, but without the risk of higher leverage or dividend payments. More…

Peers

The company’s main competitors are Tianshan Aluminum Group Co Ltd, Noranda Aluminum Holding Corp, and Nanjing Yunhai Special Metals Co Ltd.

– Tianshan Aluminum Group Co Ltd ($SZSE:002532)

Tianshan Aluminum Group Co Ltd is a Chinese aluminum producer. The company has a market cap of 30.98B as of 2022 and a Return on Equity of 16.7%. Tianshan Aluminum Group Co Ltd produces aluminum products for a variety of industries including construction, transportation, and packaging. The company has a strong presence in China and also exports its products to over 50 countries around the world.

– Noranda Aluminum Holding Corp ($OTCPK:NORNQ)

Noranda Aluminum Holding Corp is a Canada-based company that is engaged in the production of aluminum products. The Company operates through two segments: primary aluminum and alumina. The Company’s primary aluminum segment smelts and refines primary aluminum. The Company’s alumina segment mines, refines and markets alumina. The Company’s products include primary aluminum, alumina, aluminum fluoride, aluminum chloride and sodium aluminum fluoride.

– Nanjing Yunhai Special Metals Co Ltd ($SZSE:002182)

Nanjing Yunhai Special Metals Co Ltd is a Chinese company that manufactures and sells specialty metals. It has a market capitalization of 14.83 billion as of 2022 and a return on equity of 18.83%. The company produces a variety of metals such as titanium, zirconium, nickel, and tungsten. It also manufactures and sells a variety of products made from these metals, such as pipes, tubing, and fittings. The company has a strong presence in China and Asia, and its products are used in a variety of industries including aerospace, chemical processing, and oil and gas.

Summary

Investors considering CENTURY ALUMINUM have taken note of the company’s fourth quarter financial results for FY2022. Total revenue for the quarter was reported to be a dramatic decrease of 287.9% from the previous year, with a net income decrease of 19.6%. This has caused some investors to be bearish on the company’s stock.

However, this negative news may still provide opportunity for savvy investors. Those who are willing to take a gamble on the stock may be able to capitalize on a possible turnaround in the future.