Good afternoon. Thank you for attending today's Century Aluminum Company First Quarter 2025 Earnings Conference Call. My name is Makai, and I'll be the moderator for today's call. All lines will be muted during the presentation portion of the call with an opportunity for your questions and answers at the end. At this time, I would like to pass the call over to our host, Ryan Crawford, Investor Relations. Ryan, you may proceed.

Thank you, operator. Good afternoon, everyone, and welcome to the conference call. I'm joined here today by Jesse Gary, Century's President and Chief Executive Officer; and Peter Trpkovski, Executive Vice President, Chief Financial Officer, and Treasurer. After our prepared comments, we will take your questions. As a reminder, today's presentation is available on our website at www.centuryaluminum.com. We use our website as a means of disclosing material information about the company and for complying with Regulation FD. Turning to Slide 1. Please take a moment to review the cautionary statements shown here with respect to forward-looking statements and non-GAAP financial measures contained in today's discussion. And with that, I'll hand the call to Jesse.

Thanks, Ryan and thanks to everyone for joining. Just before we dive into the results today, I'd like to congratulate Peter Trpkovski on his recent promotion to CFO. Many of you have gotten to know Pete over his last 12 years at Century. He has extensive knowledge of the company's operations and a proven track record of success in every area that he's led. I have every confidence that his expertise and leadership will continue to drive Century's long-term success as we move forward. Congrats Pete. Okay, I'll start today by reviewing our first quarter results and the strong market conditions we've had so far in 2025. I'll then walk through our operational performance for the quarter and some initiatives we have planned for Q2. Pete will then take you through the details of the Q1 results and our second quarter outlook before we turn the call over for questions. Century's safety performance got off to a good start in Q1 with improved outcomes at each location versus the last year. This is rewarding to see as we continue to invest substantial time and effort towards improving the safety culture at each of our locations. Safety is our number one priority and is fundamental to our high-performance culture. Turning to financial results. Century generated $78 million of adjusted EBITDA in the first quarter, driving a reduction in net debt of $55 million and increasing liquidity by $94 million. Pete will walk you through the details here, but we are really pleased with the way the business performed and the excellent job the team did to bring working capital levels down in the quarter. Overall, continued strong LME and rising Midwest premium offset higher energy prices in the first quarter. Realized LME prices averaged $2,553 in Q1, while realized Midwest and…

Thank you, Jesse. It's great to be with all of you again and I'm really excited to be taking on this expanded role. I'll start by walking you through our financial performance for the first quarter and end with providing our outlook for the second quarter. Century delivered solid results in Q1 with $78 million in adjusted EBITDA. This is down modestly from Q4, primarily due to polar vortex-linked weather conditions, impact on energy prices and one-time alumina costs and partially offset by higher all-in metal prices. The core fundamentals of our business remain strong as we move into the second quarter. Let's turn to Slide 7 and review our Q1 performance. On a consolidated basis, first quarter shipments rose slightly, nearing 169,000 tons, an increase of 1% sequentially as all smelters were operating at their targeted utilization levels by quarter end. As Jesse mentioned, Iceland power curtailments were fully lifted in March, allowing us to ramp up our Grundartangi smelter back to full production. At Jamalco, we had a strong start to the year, producing our highest quarterly volume in Q1 since we acquired the refinery in 2023. Going forward, we remain focused on achieving lower cost of production as we continue to invest in our capital improvement program there, which I'll talk about in a few minutes. Net sales for the quarter were $634 million, a $3 million increase due to higher metal volume and all-in metal pricing, partially offset by lower third-party alumina sales. For the quarter, we reported net income of $30 million or $0.29 per share. Our adjusted net income was $37 million or $0.36 per share, including an adjustment of approximately $4 million or $0.04 per share related to the emergency energy charges at Mt. Holly that Jesse previously discussed. Adjusted EBITDA was $78…

Thanks Pete. Just before we move to questions, I'd like to thank President Trump again for the significant actions that he and his administration have taken to restore American manufacturing and stand up for American workers. The Section 232 tariffs have truly enabled a new future for the U.S. aluminum industry. Following the implementation of the Section 232 tariffs, we have seen the Midwest premium rise and stabilize around $0.39. There is some significant front-running of foreign imports ahead of the March 12th effective date that temporarily raised U.S. inventory levels and has pressured the Midwest premium below $0.40, while those inventories are consumed. We continue to believe that the Midwest premium will rise to the $0.45 to $0.50 range as those inventories are reduced over the next couple of months. On April 2nd, President Trump took further actions to restore the U.S. manufacturing base through implementation of the reciprocal tariffs. We have long prided ourselves on sourcing locally for each of our operations and at Sebree and Mt. Holly, we continue to source most of our key cost inputs from American suppliers. In response to the President's groundbreaking actions, we have now taken further steps to shorten and secure the remainder of our major supply chains consistent with the intent of the reciprocal tariff program. I'm proud to say that the team has done a fantastic job, and we do not expect any material cost increases as a result of the program. As the largest producer of primary aluminum in the United States, Century is doing its part to build and secure the aluminum production that is so essential to U.S. national security needs. When complete, our new smelter project will represent the first new smelter built in the U.S. in 50 years and will double the size of the existing U.S. industry, creating over 1,000 full-time direct jobs and over 5,500 construction jobs. We look forward to working with the Trump administration to make this industry-changing project a reality. We are ready for your questions and we'll now turn the call over to the operator.

Thank you. We will now begin today's Q&A session. [Operator Instructions] The first question is from the line of Katja Jancic with BMO Capital Markets. You may proceed.

Hi, thank you for taking my questions. Maybe starting on the second quarter guide. Just to confirm, the incremental OpEx costs of $10 million to $15 million, that is one time. So, in other words, in 3Q, that should reverse? Correct?

That's correct. That should be one-time in Q2.

And maybe just to clarify, I thought last quarter, some of the higher alumina costs were also one-time, which were expected to reverse. Is that not right? Because there's no benefits for alumina, I don't see it.

Yes, that's correct. It's correct that it's one-time. And the explanation is that given the significant volatility in the alumina pricing, it mostly relates to timing of vessels sold to third parties. So, we did sell a very high-priced vessel in Q1. And by the time we reached our vessel that we were going to sell into Q2, the price had fallen. So, most of that difference that you're seeing there relates to timing of vessels. We saw a little bit of cost pressure at Jamalco coming through in Q2 as well, and those really account for most of that $10 million there.

And then maybe on the manufacturing credit receivable, I think you mentioned that some of it is going to be received in 2Q. Can you provide how much you're expecting to receive? And then how we should think of the remaining receivables when that cash should come through?

Hey Katja, its Pete. If you remember back on the past few calls, we provided an overall annual estimate of $70 million to $80 million as it relates to the 45X production tax credits, which are owed to us by the U.S. government. So, now, as I said on the call, we expect to receive about $60 million of our FY 2023 amount in Q2. As you also may recall, at the end of last year, carbon costs weren't made eligible for the production tax credit until late last year. So, the remaining incremental $20 million for a total of $80 million is expected later this year or early next year.

And then similar for the rest, what you're going to be receiving through this year, it's always going to come in the second quarter?

No, we typically file around the end of the first quarter into the beginning of the second quarter. And you could expect in normal reoccurring timeline that we'll get our proceeds from those three to six months thereafter.

So, what Pete is saying, Katja, you could potentially see that the 2024 amounts coming through in late 2025 or early 2026.

Thank you. The next question is from the line of Nick Giles with B. Riley Securities. You may proceed.

Thank you, operator. Good afternoon everyone. First, Pete, I wanted to say congratulations on stepping in on the new role that's well-deserved. My first question, great to see your net debt move down and your liquidity has moved above your target range. So, I wanted to confirm whether reducing debt remains the top use of excess cash? And you've touched on some of this already, but are there any other cash flow considerations we should keep in mind as we try to model out the balance of the year?

Hey Nick, no, you pretty much got it. In the near term, we'll continue to prioritize paying down those debt levels, while also continuing on the existing CapEx programs that we've already talked to you about. So, priority as those additional cash amounts come in, will remain bringing down debt levels.

Thanks for that. And my next one was you mentioned some cost pressures at Jamalco in 1Q. And I wanted to use that as an opportunity to get an update on the operations there. I mean, do you feel that there are further cost improvements to be made that might not be reflected in your guidance today? And then can you just remind us of any additional capacity and ultimately capital requirements?

Yes, absolutely, Nick. Great question. Yes, it was relatively minor in Q1 on the cost pressure side. Asset continues to operate well. And as we mentioned, it actually hit its highest quarterly volume levels in Q1 since we've owned the asset. So, the team is doing a good job driving improvements, just a little noise on the cost side in Q1 that should hopefully continue to reduce throughout the year. Over the long-term, we continue to believe we'll be able to take that asset into the second quartile of the cost curve. And to do that, we need to execute on our CapEx program there, which both Pete and I talked about, the next step being the introduction of the steam generation turbine, which hopefully will be done by the end of the year. And you'll start to see the benefits of that immediately because we'll reduce our third-party power purchases, hopefully starting in Q1 of 2026. So, lots of good news to come in the future at Jamalco. We continue to think that's going to be a really good asset for us, and it's just a matter of time and executing on our CapEx programs to get where we want to be. Then to your last question, which is on the volume side, it's operating near that 1.2 million ton level that we've been targeting today. And with this CapEx program over the next couple of years, we continue to believe we'll creep it up towards its nameplate capacity of 1.4 million tons.

Jesse, I really appreciate you addressing all those questions. I know there were a few in there. Just to clarify, have you quantified the benefit on the cost side of the turbines later this year?

We haven't. And as we get that done and as we move into 2026 and begin to talk about the 2026 outlook, we'll begin to give you a little bit more color around that.

Okay, all right. Guys, keep up the good work and I'll jump back in the queue for now. Thanks.

Thanks.

Thank you. The next question is from the line of John Tumazos with Very Independent Research. You may proceed.

Thank you very much. 46 of the last 49 weeks total exchange inventories have fallen. Clearly, the LME price dipping to $1.07 per pound anticipates a demand fall with the tariffs and trade war. When do you expect an inflection point where lower demand would cause exchange inventories to rise, suggesting the metal surplus that the LME price is anticipating?

Thanks John. Great question. Obviously, there's a lot of speculation out there. As I said in my prepared remarks, we actually haven't seen any of that yet to date. We've actually seen relatively strong demand, especially in the U.S. as a lot of our customers have been nearshoring their supply chains. And so that's been especially strong on the billet demand side. Europe has been weak, but that was weak for a while over the past couple of years, we're actually starting to see a small uptick there, not enough to call it a trend, but enough to be a bit hopeful. So, we continue to think, at least on the premium side, things look pretty good, but we're cognizant of the volatility that's out there and are watching it closely. But net-net, as I said in my prepared remarks, we still see a small deficit this year. And we expect that deficit to grow going forward rather than increase as you positive.

Over the last three years of the Ukraine war, there were three -- I don't know if the right word is incidents or episodes when very large deliveries of Rusal metal were made in the LME warehouses in Asia that replenished supply. Since April last year, the Rusal metal is not eligible if it's produced since April last year. How would you think mechanically the exchange inventories get replenished? Chinese deliveries, Rusal restarting production? Mechanically, where do you think, the new supply is going to arise?

It's a complicated question, John, and one that depends on a lot of geopolitics, obviously. Just remember that the Russians are sanctioned by the U.S. today and Europe has increased sanctions on the Russians recently that will continue to further bite as we move into 2026, the way they're structured. So, that's a difficult question on the Russian side, and we'll wait to see and watch how the sanction policy manifests itself. In terms of -- if I take your question at a broader level, where the marginal units are coming from, as I mentioned, we're actually projecting that we stay in deficit. So, we don't actually necessarily see those inventories replenishing. Quite the opposite, we potentially see global inventories decreasing over time. So, the way we see it, we continue to believe alumina prices will continue to rise in the near to medium future and certainly over the long run.

If you could bear with me one more, Jesse. The alumina shortage reversed in November to surplus. And if the IAI statistics are accurate, in the first quarter, the surplus margin was 2.2% more metallurgical alumina than 1.92 times world smelter output, which is a considerable margin. Do you expect alumina refineries to close to balance the market? Or do you expect alumina will find its way from China, Vietnam, India to feed resource capacity and the Chinese will choose to produce more metal rather than close refineries. And further, there's more refineries on the drawing board in India and Indonesia and even in China, that could increase the alumina surplus. How do you think this plays out?

Yes. Over time, when you look back, the alumina market has actually been fairly disciplined in curtailing capacity when the price is indicated. And so, our expectation would be that you would start to see closures at price levels if price levels go low enough to demand that. You did see a little bit of that as the alumina price went lower and then bounced higher more recently. So, we're back around that $350 level per ton on the API. But our expectation would be you will see closures if alumina price continues to fall or to match increasing supply over time.

Thank you. I'll let somebody else ask question. Congratulations on the profits.

Thanks John.

Thanks John.

The next question is from the line of Nick Giles with B. Riley Securities. You may proceed.

Thank you so much for taking my follow-up here. In your 2Q guide, you outlined a $5 million to $10 million hit on raw materials. But when I try to do the back of the neck and compare it to your 1Q guide using your sensitivities, I get closer to an annual hit of this magnitude, not a quarterly impact. So, I just wanted to see if I'm missing something or if there was anything in the 1Q print that would have been different from your initial guide?

Hey Nick, its Pete. I can kind of give you a quick update on that. So, what we've shown on the page is the coke pitch and caustic price realizations that we expect across our smelters and our refinery. Coke is starting to see price increases as well as pitch and caustic. So, if you take the sensitivities that we have in our appendix, and we can help with the modeling of this. For the quarter, it's at least $5 million to $7 million. For the guide, we said $5 million to $10 million for raw materials. So, there's some other pluses and minuses within this bucket, but we try to just show you here what we have in our sensitivities. So, for the three in total, coke, pitch, and caustic, all seeing some temporary price headwinds. And the sensitivities for the quarter, we can help you with the math and the modeling, but it equates to about $5 million to $7 million.

No, that makes sense, Pete. I appreciate that. And I'll certainly take you up on that. My last one, if I could. When we think about the new aluminum smelter, can you just remind us of what some of the key milestones are? What would be the earliest that you could deploy meaningful capital towards the project?

Yes. Thanks Nick. Great question. And we remain really excited about the project. We're working really hard. The next two key milestones, which are linked are to finalize negotiations of the power arrangements. And then following from that and driven from that, we'll be making a site selection. And then the next phase after that is actually further engineering work, which will take you into 2026 before you start to see any significant CapEx spend for the project.

Got it. And just as far as the project's competitiveness, I mean, I can't imagine a more favorable environment for a domestic producer like Century. So, is there anything that could change or unwind such as a Canadian exemption for Section 232 that would, in your mind, change the competitiveness of the project? Or do you feel like the project will stand on its own two feet even if we were to see such an exemption?

Yes. As you might imagine, we're taking very long-term but disciplined view on the returns for a project of this size. And so, we're not modeling for a year or two out. We're modeling for a very long lifespan for what will be a 50-year asset once built. And so, when we look at that, we're looking at very long-term trends. But obviously, the current market environment is a great -- as you said, is a very constructive environment to find ourselves in when considering a project. And in that, I include the political environment and the dedication of this administration towards reshoring manufacturing. So, we think this is the exact type of project that this administration wants to see. And we continue to think that the policy coming out of this administration will continue to be supportive of the project.

Good to hear. Guys, again, keep up the good work.

Thanks Nick.

Thanks Nick.

There are currently no questions registered. [Operator Instructions] There are no registered questions at this time. I'd like to pass the call back over to Ryan for any further remarks.

This is Jesse. I'll just say thanks, everyone, for joining the call and we look forward to talking to you next in August. Have a good summer everybody.

Thank you all. That will now conclude today's call. We appreciate your participation. Hope you have a wonderful day and you may now disconnect your lines.