Industrials

Century Aluminum Rises on Outlook and Bottom Line Beat

Chris Lange

Published: February 19, 2016 11:05 am

Last Updated: January 13, 2020 12:59 pm

Century Aluminum Co. (NASDAQ: CENX) released its fourth-quarter earnings report after the markets closed Thursday. The company said it had a net loss of $0.53 per share on $383.9 million in revenue. That compares to consensus estimates that call for a net loss of $0.54 per share on revenue of $392.1 million. In the same period of the previous year, it reported a net loss of $0.78 per share on $551.2 million in revenue.

Shipments of primary aluminum for the fourth quarter of 2015 were 211,710 tonnes, compared with 226,082 tonnes shipped in last year.

Looking ahead in 2016, this company is taking more aggressive actions to bolster its businesses’ competitive position and preserve the ability for its shareholders to participate in the improvement in industry conditions that will occur at some point. And judging by the investors’ reaction from this report, conditions are improving.

On the books, cash and cash equivalents totaled $115.4 million in the fourth quarter, compared to $163.2 million in the same period from the previous year.

Michael Bless, president and CEO of Century Aluminum, commented on earnings:

The fundamental demand picture in our sector has remained reasonably stable outside China. True demand growth in China has continued to deteriorate. Despite decreasing demand growth, the uneconomic supply expansion of the Chinese aluminum industry has continued through government intervention and manipulation. Evidence continues to mount that the illegal government subsidies and other practices underlying this supply growth are in violation of China’s WTO obligations and have materially injured the industry around the globe. As direct evidence, this most recent quarter witnessed actions and announcements that will bring U.S. primary production down to an annualized rate of just over five hundred thousand metric tons. We continue to work with industry participants, including our labor partners, to encourage government action before it is simply too late.

Shares of Century Aluminum were trading up more than 16% at $6.04 on Friday, with a consensus analyst price target of $8.40 and a 52-week trading range of $2.63 to $22.49.