Kaiser Aluminum(US:KALU)2025-02-20 22:22Financial 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]