Century Aluminum Company (CENX)
Solvency ratios
| Dec 31, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.00 | 0.00 | 0.00 | 0.23 | 0.00 | 0.23 | 0.28 | 0.26 | 0.23 | 0.23 | 0.22 | 0.21 | 0.22 | 0.23 | 0.18 | 0.17 | 0.17 | 0.16 | 0.16 | 0.17 |
| Debt-to-capital ratio | 0.00 | 0.00 | 0.00 | 0.55 | 0.00 | 0.52 | 0.52 | 0.49 | 0.42 | 0.44 | 0.46 | 0.44 | 0.51 | 0.47 | 0.37 | 0.31 | 0.29 | 0.28 | 0.27 | 0.27 |
| Debt-to-equity ratio | 0.00 | 0.00 | 0.00 | 1.21 | 0.00 | 1.07 | 1.08 | 0.96 | 0.72 | 0.77 | 0.84 | 0.78 | 1.03 | 0.89 | 0.60 | 0.45 | 0.41 | 0.38 | 0.37 | 0.37 |
| Financial leverage ratio | 2.79 | 3.00 | 3.08 | 5.19 | 5.28 | 4.69 | 3.86 | 3.69 | 3.07 | 3.31 | 3.84 | 3.73 | 4.65 | 3.79 | 3.34 | 2.56 | 2.37 | 2.35 | 2.36 | 2.22 |
The solvency ratios of Century Aluminum Company indicate its ability to meet its long-term financial obligations.
1. Debt-to-Assets Ratio: This ratio shows the proportion of the company's assets financed by debt. Between December 31, 2019, and December 31, 2024, this ratio fluctuated mildly but generally remained below 0.3, indicating that the company has a relatively low level of debt in relation to its assets.
2. Debt-to-Capital Ratio: This ratio reflects the percentage of the company's capital that is funded by debt. From December 31, 2019, to December 31, 2024, the ratio increased from 0.27 to 0.00, with a peak at 0.55, suggesting fluctuations in the level of debt compared to the company's total capital.
3. Debt-to-Equity Ratio: This ratio depicts the company's leverage by showing how much of its operations are funded by debt compared to equity. Throughout the period under review, the ratio fluctuated significantly, ranging from 0.37 to 1.21, indicating varying degrees of reliance on debt to fund operations.
4. Financial Leverage Ratio: This ratio measures the extent to which the company uses debt in its capital structure. Century Aluminum's financial leverage ratio rose from 2.22 in December 31, 2019, to 2.79 in December 31, 2024, with fluctuations throughout the period. The ratio indicates the company's increasing reliance on debt to finance its operations over time.
In conclusion, Century Aluminum Company has maintained generally manageable levels of debt in relation to its assets and capital over the period, despite fluctuations in leverage and debt reliance. However, the company's increasing financial leverage ratio suggests a growing reliance on debt, which may warrant further monitoring to ensure sustainable financial health.
Coverage ratios
| Dec 31, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Interest coverage | 4.05 | 0.35 | 0.17 | 0.90 | -0.80 | -1.64 | -6.64 | -5.13 | -2.51 | 0.86 | 6.49 | 2.17 | 0.07 | -2.14 | -3.30 | -2.55 | -2.44 | -1.95 | -1.64 | -2.90 |
The interest coverage ratio for Century Aluminum Company shows a fluctuating trend over the reporting periods provided.
The company's interest coverage ratio was negative in the quarters ending December 2019, March 2020, June 2020, September 2020, December 2020, March 2021, June 2021, September 2021, June 2022, September 2022, December 2022, March 2023, and June 2023. This indicates that the company's operating income was insufficient to cover its interest expenses during these periods.
However, starting from the quarter ending December 31, 2021, the interest coverage ratio turned positive and increased significantly in the subsequent quarters ending March 31, 2022, June 30, 2022, September 30, 2022, December 31, 2022, March 31, 2023, June 30, 2023, September 30, 2023, December 31, 2023, March 31, 2024, June 30, 2024, and December 31, 2024.
The positive interest coverage ratios from 2021 onwards indicate that the company's operating income is now more than sufficient to cover its interest expenses, which could signify improved financial performance and reduced financial risk related to debt servicing.
Overall, the recent positive trend in the interest coverage ratio suggests a strengthening financial position for Century Aluminum Company in terms of its ability to meet interest obligations with its operating income.