American aluminium smelter Century Aluminum Company posted results for the third quarter on Tuesday. Numbers for the quarter were soft largely due to market uncertainty and the resulting weak prices at the London Metal Exchange, according to the firm.
In the just-ended quarter Century shipped 198,543 metric tons, off by 2 percent on the quarter from last quarter’s total of 203,380 metric tons, which the firm attributes to lower production at its Hawesville smelter. Net sales fell by 7 percent to US$438.0 million on the quarter, off from US$473.1 million, largely due to a drop in aluminium prices at the London Metal Exchange.
Century posted a net loss of US$20.7 million in the quarter, which was unchanged from the prior quarter, and reported an adjusted net loss of US$37.4 million, down on the quarter from last quarter’s adjusted net loss of US$16.2 million. The firm’s adjusted EBITDA of US$(12.2) million was a mirror of the prior quarter’s number of US$11.7 million, which the firm chalks up to soft pricing at the LME.
Michael Bless, President and Chief Executive Officer, said that the firm faced a playing field full of uncertainty in the quarter, hence the mixed results.
“The external environment remains complex, with conflicting signals evident at each of the macro and sector specific levels. We have seen slowing growth in many of our customers’ markets, and this condition is manifested in declining product premiums. However, inventory levels remain relatively low and the global balance of supply and demand is, at this time, consistent with a healthy market. Of course the broader environment remains exposed, on the upside as well as the downside, to developments on several key geopolitical issues. The alumina price has, as expected, returned to more normalized levels, both in absolute and in relation to the metal price.”
“The company’s operations remain largely on track,” Bless continued. “At Hawesville, we are on pace to return the plant to full production in 2020. As previously reported, the three newly rebuilt potlines are fully operational. Earlier this year, we disconnected one of the two lines which have been continuously operating; its rebuild is on schedule and we expect to begin restarting cells in January and to have the line at full production by the end of the first quarter. Again as previously discussed, we were hoping to extend the life of the last potline to be refurbished into the latter months of this year. However, a severe and persistent alumina quality issue began to manifest over the summer and exposed these fragile cells, which were several years past their normal service life, to undue stress. We thus made the decision to disconnect the remaining cells; this last line will be rebuilt following the completion of the line presently under construction. Our other operations are performing well; conversion costs are under control and safety performance remains good and continues generally to improve.”