While investors have been through several bouts of market volatility since the turn of the century, many of those episodes, such as the GFC and the collapse of Silicon Valley Bank, were rooted in the banking sector and financial system. AndAnalyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compe ...

Financial Results and Adjustments - Kaiser Aluminum Corporation will release its Q1 2025 financial results on April 23, 2025, and host a conference call on April 24, 2025[1]. - For the year ended December 31, 2023, net income was adjusted to $67.8 million, up from $47.2 million previously reported, reflecting a $20.6 million increase due to the WAC change[5]. - The basic net income per share for 2023 increased from $2.95 to $4.25 after adjustments[5]. - For the year ended December 31, 2024, net income was adjusted to $65.7 million, an increase of $18.9 million from the previously reported figure[6]. - The basic net income per share for 2024 increased from $2.91 to $4.08 after adjustments[6]. - For the nine months ended September 30, 2024, net income was adjusted to $45.9 million, an increase of $6.2 million from the previously reported figure[8]. - The basic net income per share for the nine months ended September 30, 2024, increased from $2.47 to $2.85 after adjustments[8]. - For the year ended December 31, 2023, GAAP net income was $67.8 million, compared to $65.7 million for the year ended December 31, 2024, reflecting a year-over-year increase of approximately 3.2%[10]. Accounting Changes - The company changed its inventory accounting method from LIFO to weighted average cost (WAC) effective January 1, 2025, to improve comparability of operational results[3]. - The accounting change resulted in an increase to inventory and retained earnings of $46.8 million and $35.6 million, respectively, as of January 1, 2023[4]. - As of June 30, 2024, inventories increased to $532.7 million, reflecting an adjustment of $85.8 million due to the accounting change[7]. - The effect of inventory methodology change contributed $26.7 million to adjusted EBITDA for the year ended December 31, 2023, compared to $24.5 million for the year ended December 31, 2024, reflecting a decrease of approximately 8.2%[10]. Financial Performance Metrics - Adjusted EBITDA for the year ended December 31, 2023, was $236.3 million, while for the year ended December 31, 2024, it is projected to be $241.0 million, indicating a growth of about 2.0%[10]. - The company reported operating income, excluding non-run-rate items, of $127.7 million for the year ended December 31, 2023, compared to $124.6 million for the year ended December 31, 2024, showing an increase of approximately 2.5%[10]. - Interest expense decreased from $46.9 million for the year ended December 31, 2023, to $43.7 million for the year ended December 31, 2024, representing a reduction of about 6.8%[10]. - The company incurred restructuring costs of $5.0 million for the year ended December 31, 2023, which increased to $7.6 million for the year ended December 31, 2024, reflecting a rise of 52.0%[10]. - Depreciation and amortization expenses were $108.6 million for the year ended December 31, 2023, and are projected to increase to $116.4 million for the year ended December 31, 2024, indicating an increase of approximately 7.2%[10]. Market Focus - Kaiser Aluminum Corporation continues to focus on expanding its market presence in aerospace and high-strength applications, leveraging its expertise in semi-fabricated specialty aluminum products[12]. Other Financial Events - The company experienced a mark-to-market loss of $2.2 million in the quarter ended June 30, 2024, which was offset by a gain of $2.2 million in the quarter ended September 30, 2024[10]. - Non-cash asset impairment charges were recorded at $0.4 million for the year ended December 31, 2024[10].

Financial Performance - Net sales for 2024 were $3,024.0 million, a decrease of 2.0% from $3,087.0 million in 2023[263] - Operating income for 2024 was $87.7 million, down from $95.8 million in 2023, reflecting a decline of 8.5%[263] - Net income for 2024 was $46.8 million, slightly down from $47.2 million in 2023, representing a decrease of 0.8%[263] - The company reported a comprehensive income of $54.2 million for 2024, down from $57.1 million in 2023, a decrease of 5.1%[266] - The basic net income per share for 2024 was $2.91, slightly lower than $2.95 in 2023, a decrease of 1.4%[263] - Cash flows from operating activities provided $167.1 million, down from $211.9 million in the previous year, reflecting a decrease of 21%[273] - Total expenses related to all benefit plans for the year ended December 31, 2024, were $35.0 million, a decrease from $38.3 million in 2023[370] Assets and Liabilities - Total assets increased to $2,314.9 million in 2024, up from $2,267.4 million in 2023, marking a growth of 2.1%[261] - Total liabilities rose to $1,646.9 million in 2024, compared to $1,615.2 million in 2023, an increase of 1.9%[261] - Cash and cash equivalents decreased significantly to $18.4 million in 2024 from $82.4 million in 2023, a decline of 77.7%[261] - The company’s retained earnings decreased to $6.2 million in 2024 from $10.1 million in 2023, a decline of 38.6%[261] - Total stockholders' equity increased to $668.0 million in 2024, up from $652.2 million in 2023, reflecting a growth of 2.7%[261] Capital Expenditures and Investments - Capital expenditures for 2024 totaled $180.8 million, an increase from $143.2 million in 2023, representing a rise of 26%[273] - The company reported a net cash used in investing activities of $174.6 million, compared to $128.2 million in 2023, indicating a 36% increase[273] - The fair value of plan assets increased from $73.6 million in 2023 to $76.6 million in 2024, with significant contributions from equity and fixed income investments[369] Derivative Contracts and Hedging - In 2024, the company settled derivative contracts for 154.9 million pounds of hedged shipments, compared to 207.5 million pounds in 2023[238] - The company uses derivative financial instruments to mitigate exposure to changes in market prices of aluminum and other commodities, without engaging in trading or speculative purposes[308] - The total loss recognized in the Statements of Consolidated Income (Loss) related to non-designated hedges for 2024 was $5.0 million[409] Pension and Employee Benefits - The company has a defined benefit pension plan with an accumulated benefit obligation of $29.8 million as of December 31, 2024, compared to $29.6 million in 2023[364] - The net funded status of the pension plans is $(8.2) million as of December 31, 2024, improving from $(10.0) million in 2023[360] - The company recorded a service cost of $3.6 million for pension plans in 2024, slightly down from $3.8 million in 2023[360] - The company expects to contribute approximately $4.5 million to the pension plans in 2025[364] Environmental Matters - Environmental accruals rose to $18.4 million in 2024, compared to $17.0 million in 2023, marking a 8.24% increase[431] - The company expects potential undiscounted costs related to environmental matters could exceed current accruals by up to $13.4 million over the remediation period[432] - The company is actively pursuing remediation activities for historical use of oils containing PCBs, collaborating with regulatory authorities[429] Revenue Recognition - Revenue is recognized over time for products with no alternative use, primarily in the Aero/HS Products and Automotive Extrusions markets[255] - The company identified revenue for over time contracts as a critical audit matter due to the volume and complexity of contracts[257] - Revenue is recognized as performance obligations are fulfilled, with a significant portion recognized over time for Aero/HS Products and Automotive Extrusions[316] Stock and Compensation - Total non-cash compensation expense for 2024 was $13.8 million, down from $15.4 million in 2023[389] - The aggregate fair value of awards that vested in 2024 was $8.5 million, compared to $6.2 million in 2023[390] - The expected volatility of Kaiser Aluminum's stock was 45.59% for 2024, down from 49.72% in 2023[387] Audit and Internal Controls - The company maintained effective internal control over financial reporting as of December 31, 2024, based on COSO criteria[248] - The company has been audited by Deloitte & Touche LLP since 2002[259]

Fourth Quarter 2024 Earnings Conference Call February 20, 2025 © Kaiser Aluminum All Rights Reserved Forward Looking Statements The information contained in this presentation includes statements based on management's current expectations, estimates and projections that constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include statements regarding the company's anticipated financial and operating performance, relate to future e ...

Financial Data and Key Metrics Changes - Total net sales for 2024 were just over $3 billion, with conversion revenue of $1.46 billion, a decrease of $10 million or 1% compared to 2023 [12][13] - Adjusted EBITDA for 2024 was $217 million, up approximately $7 million from 2023, with an EBITDA margin improvement of approximately 60 basis points to 14.9% [18][19] - Reported net income for 2024 was $47 million or $2.87 per diluted share, consistent with 2023's reported net income of $2.92 per diluted share [18] Business Line Data and Key Metrics Changes - Aero and High Strength conversion revenue totaled $530 million, down $4 million or approximately 1%, reflecting a 4% decline in shipments [13] - Packaging conversion revenue totaled $490 million, down $13 million or approximately 3%, with a 3% decline in shipments [14] - General Engineering conversion revenue for 2024 was $313 million, up 3% year-over-year due to a 6% increase in shipments [15] - Automotive conversion revenue was $120 million, up 3% over 2023, despite a 3% decline in shipments due to an improved product mix [15] Market Data and Key Metrics Changes - The market backdrop in 2024 was complex and rapidly changing, with challenges in each end market, particularly in Packaging [9][10] - The company expects market conditions to stabilize and become more favorable as it moves through 2025 [11] Company Strategy and Development Direction - The company is focused on niche areas in served markets with significant barriers to entry, building strong competitive positions through product differentiation [25][26] - Investments are being made to upgrade facilities and expand capacity to meet growing customer demand, particularly in the Packaging and Aerospace sectors [27][29] - The company anticipates a transformational year in 2025, driven by strategic investments and strong market positions [49] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of customer contracts and the expectation of increased aircraft production rates in 2025, despite short-term destocking impacts [30][31] - The company expects to see meaningful EBITDA and margin uplift in the second half of 2025, with around 60% of full-year EBITDA expected to come in during that period [46][47] Other Important Information - The company returned approximately $51 million to shareholders through dividends in 2024, marking the 18th consecutive year of dividend payments [22] - The company is assessing alternative inventory accounting methods other than LIFO, with an update expected prior to the release of first-quarter 2025 results [23] Q&A Session Summary Question: What are the assumptions regarding scrap spreads and their impact on EBITDA? - The company modeled EBITDA improvements based on last year's performance, expecting 150 to 200 basis points of improvement, with no significant uplift anticipated at this point [55][56] Question: What is the outlook for the Aerospace market and inventory levels? - Management expects an increase in aircraft production rates throughout 2025, which may lead to a recovery in demand and a reduction in inventory levels in the second half of the year [64][66] Question: How is the company managing the impact of the Midwest premium on pricing? - The business model allows for immediate pass-through of metal price increases, with minimal lag effects [77][78] Question: What is the expected capital expenditure for 2025? - The company anticipates capital expenditures to be around $125 million for 2025, including finalizing investments in the roll coat line and Phase 7 expansion [90] Question: What is the status of the company's net operating losses (NOLs)? - The company has utilized its NOLs as of the end of 2024, expecting cash tax payments in the range of $5 million to $7 million for 2025 [92]

Kaiser Aluminum (KALU) Q4 2024 Earnings Call February 20, 2025 12:00 PM ET Company Participants Kimberly Orlando - Senior Managing DirectorKeith Harvey - CEO, President & DirectorNeal West - EVP and CFO Conference Call Participants Bill Peterson - AnalystTimna Tanners - Analyst Operator Greetings, and welcome to the Kaiser Aluminum Corporation Fourth Quarter twenty twenty four Earnings Conference Call. At this time, all participants are in a listen only mode. A question and answer session will follow the fo ...

分组1 - Kaiser Aluminum reported quarterly earnings of $0.33 per share, missing the Zacks Consensus Estimate of $0.46 per share, and down from $0.60 per share a year ago, representing an earnings surprise of -28.26% [1] - The company posted revenues of $765.4 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 1.75%, and up from $722 million year-over-year [2] - Over the last four quarters, Kaiser has surpassed consensus EPS estimates just once, and has topped consensus revenue estimates two times [2] 分组2 - The current consensus EPS estimate for the coming quarter is $0.82 on revenues of $768.04 million, and for the current fiscal year, it is $5.14 on revenues of $3.15 billion [7] - The estimate revisions trend for Kaiser is currently unfavorable, resulting in a Zacks Rank 5 (Strong Sell) for the stock, indicating expected underperformance in the near future [6] - The Metal Products - Procurement and Fabrication industry, to which Kaiser belongs, is currently in the bottom 20% of the Zacks industry rankings, which can materially impact stock performance [8]

Financial Performance - Fourth quarter 2024 net sales increased to $765 million, up from $722 million in the prior year, driven by a 3% increase in shipments[9] - Full year 2024 net sales decreased to $3.0 billion compared to $3.1 billion in the prior year, primarily due to lower shipments[12] - Fourth quarter 2024 adjusted EBITDA was $50 million, a decrease of $2 million compared to the prior year, with an adjusted EBITDA margin of 14.0%[11] - Full year 2024 adjusted EBITDA increased to $217 million, up $7 million from the prior year, with an adjusted EBITDA margin of 14.9%[16] - Fourth quarter 2024 net income was $7 million, or $0.43 per diluted share, compared to $8 million and $0.47 per diluted share in the prior year[10] - Full year 2024 adjusted net income was $41 million, or $2.51 per diluted share, down from $44 million and $2.74 per diluted share in the prior year[13] - Net income for the year ended December 31, 2024, was $46.8 million, a decrease of 0.8% compared to $47.2 million in 2023[29] - The company reported a diluted net income per share of $2.87 for the year 2024, compared to $2.92 in 2023[36] Operational Highlights - The new roll coat line in packaging operations is being commissioned, with customer qualifications underway[3] - The Phase VII expansion at the Trentwood rolling mill is expected to be completed in the second half of 2025, ahead of projected demand increases[3] Liquidity and Cash Flow - As of December 31, 2024, the company had total liquidity of $572 million, including cash and cash equivalents of $18 million and borrowing availability of $553 million[18] - Total cash provided by operating activities for the year 2024 was $167.1 million, down from $211.9 million in 2023[31] - Cash and cash equivalents decreased significantly to $18.4 million as of December 31, 2024, from $82.4 million in 2023[34] Balance Sheet - Current assets decreased to $976.4 million as of December 31, 2024, from $990.2 million in 2023[34] - Total liabilities increased to $1,646.9 million as of December 31, 2024, compared to $1,615.2 million in 2023[34] Future Outlook - The company expects consolidated conversion revenue to increase by 5% to 10% in 2025, with adjusted EBITDA margin improving by 50 to 100 basis points compared to 2024[20] Restructuring Costs - The company incurred restructuring costs of $7.6 million for the year ended December 31, 2024, compared to $5.0 million in 2023[29]

Core Insights - Kaiser Aluminum Corporation reported a fourth quarter net sales of $765 million, an increase from $722 million in the prior year, driven by a 3% increase in shipments [3][7] - The company’s full year net sales for 2024 decreased to $3.0 billion from $3.1 billion in 2023, primarily due to lower shipments [12][13] - Adjusted EBITDA for the fourth quarter was $50 million, reflecting a decrease of $2 million compared to the prior year, with an adjusted EBITDA margin of 14.0% [9][14] Fourth Quarter 2024 Highlights - Shipments for the fourth quarter were 292 million lbs, compared to 284 million lbs in the same quarter of the previous year [3][7] - Net income for the fourth quarter was $7 million, or $0.43 per diluted share, down from $8 million or $0.47 per diluted share in the prior year [8][13] - Conversion revenue for the fourth quarter was $358 million, a 1% decrease from the previous year [4][7] Full Year 2024 Highlights - Full year net income was reported at $47 million, or $2.87 per diluted share, consistent with the previous year [13][14] - Adjusted net income for the full year was $41 million, down from $44 million in 2023, with adjusted net income per diluted share at $2.51 compared to $2.74 in the prior year [13][14] - Adjusted EBITDA for the full year was $217 million, an increase of $7 million from the previous year, with an adjusted EBITDA margin of 14.9% [14][15] Management Commentary - The CEO expressed satisfaction with the company's performance in 2024, highlighting margin expansion despite a complex market environment [2] - The company anticipates stabilization in market conditions in 2025, which will allow it to leverage significant growth investments nearing completion [2] Cash Flow and Liquidity - As of December 31, 2024, the company reported total liquidity of $572 million, consisting of $18 million in cash and cash equivalents and $553 million in borrowing availability [16][30] - The company funded $35 million of working capital, $181 million of capital investments, and returned $51 million to stockholders through dividends in 2024 [15][16] 2025 Outlook - For 2025, the company expects consolidated conversion revenue to increase by 5% to 10% and an improvement in adjusted EBITDA margin by 50 to 100 basis points compared to 2024 [18]

Core Viewpoint - Kaiser Aluminum Corporation is set to release its fourth quarter and full year 2024 financial results on February 19, 2025, with a conference call scheduled for February 20, 2025 [1] Company Overview - Kaiser Aluminum Corporation, based in Franklin, Tennessee, is a prominent producer of semi-fabricated specialty aluminum products, catering to various industries including aerospace, automotive, and packaging [3] - The company has been operational since 1946 and emphasizes quality, innovation, and service in its production of value-added aluminum products such as plate, sheet, coil, and extrusions [3] - Kaiser Aluminum's stock is part of the Russell 2000® index and the S&P Small Cap 600® index, indicating its standing in the market [3] Investor Information - The company provides a dedicated investor relations section on its website, offering access to financial performance notifications, SEC filings, and earnings announcements [4] - A live webcast of the quarterly earnings call will be available, along with an audio archive post-call [2][4]