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CHICAGO - Century Aluminum Company (NASDAQ:CENX), currently valued at $2.1 billion and showing strong momentum with a 75% return over the past year, announced Thursday plans to restart over 50,000MT of idled production at its Mt. Holly, South Carolina smelter, representing an investment of approximately $50 million. According to InvestingPro analysis, the company appears undervalued based on its Fair Value metrics.
The restart will allow the facility, currently operating at 75 percent capacity, to reach full production by June 30, 2026 - a level not achieved since 2015. The company, which maintains a healthy current ratio of 1.84 and has demonstrated profitability with earnings per share of $1.22, stated the expansion will create more than 100 new jobs and increase U.S. domestic aluminum production by nearly 10 percent.
According to Century Aluminum, the decision comes in response to the recent increase in Section 232 tariffs on aluminum imports to 50 percent. CEO Jesse Gary attributed the restart to these policy changes aimed at supporting domestic manufacturing.
The company is working with the South Carolina Public Service Authority (Santee Cooper), its power supplier, to extend the current contract through 2031 to secure additional power needed for the expansion. The restart remains subject to a definitive agreement with Santee Cooper and confirmation of economic incentives from Berkeley County and South Carolina. For detailed analysis of Century Aluminum’s expansion strategy and financial outlook, InvestingPro subscribers can access comprehensive research reports and additional ProTips.
A University of South Carolina study released in 2024 found that at full capacity, the Mt. Holly smelter generates an economic impact of over $890 million annually in South Carolina, with jobs directly supported by Century Aluminum averaging wages of $100,000.
Century Aluminum describes itself as the largest producer of primary aluminum in the United States, with additional production facilities in Iceland, the Netherlands and Jamaica. The company maintains a solid financial health score according to InvestingPro analysis, with revenue growth of 11.4% in the last twelve months.
The announcement was made in a company press release.
In other recent news, Century Aluminum Company completed a private offering of 6.875% senior secured notes, raising $400 million in gross proceeds. The net proceeds of approximately $395 million will be used to refinance existing notes, repay credit facility borrowings, and cover related expenses. Additionally, the U.S. government has doubled tariffs on imported primary aluminum, prompting Century Aluminum to announce plans for the first new U.S. aluminum smelter in five decades, which is expected to significantly increase domestic production capacity. S&P Global Ratings has revised the outlook for Century Aluminum to positive from stable, maintaining the company’s ’B-’ issuer credit rating. The company’s profitability has improved due to lower production costs and strong price realizations, with further earnings momentum anticipated from the Iceland cast house project. These developments highlight Century Aluminum’s strategic financial and operational initiatives amid changing market conditions.
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