KAISER ALUMINUM CORPORATION AND SUBSIDIARY COMPANIES
(Debtor-in-Possession)
STATEMENTS OF CONSOLIDATED INCOME (LOSS)
(Unaudited)
(In millions of dollars, except share and per share amounts)
Quarter Ended
March 31,
-----------------------------
2005 2004
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Net sales $281.4 $210.2
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Costs and expenses:
Cost of products sold 242.2 194.2
Depreciation and amortization 4.9 5.5
Selling, administrative, research and
development, and general 17.7 20.8
Other operating charges(1) 6.2 --
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Total costs and expenses 271.0 220.5
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Operating income (loss) 10.4 (10.3)
Other income (expense):
Interest expense (excluding unrecorded
contractual interest expense of $23.7
for both quarters) (2.1) (2.0)
Reorganization items (7.8) (8.6)
Other - net (.4) (.2)
--------------- -------------
Income (loss) before income taxes and
discontinued operations .1 (21.1)
Provision for income taxes(2) (2.4) (1.5)
--------------- -------------
Loss from continuing operations (2.3) (22.6)
Income (loss) from discontinued
operations, net of income taxes,
including minority interests(3) 10.6 (41.4)
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Net income (loss) $8.3 $(64.0)
=============== =============
Income (loss) per share--Basic/
Diluted:(4)
Loss from continuing operations $(.03) $(.28)
=============== =============
Income (loss) from discontinued
operations $.13 $(.52)
=============== =============
Net income (loss) $.10 $(.80)
=============== =============
Weighted average shares outstanding
(000):(4)
Basic/Diluted 79,681 79,934
(1) Other operating charges for the quarter ended March 31, 2005
included a charge totaling $5.6 associated with the implementation
of new employee savings plans (Fabricated products business unit:
$5.2 and Corporate: $.4) and a $.6 charge related to the
previously announced move of the Corporate Headquarters from
Houston, Texas to Foothill Ranch, California. See Note 11 of Notes
to Interim Consolidated Financial Statements in the Company's
Quarterly Report on Form 10-Q for the quarter ended March 31,
2005.
(2) The income tax provision for the quarters ended March 31, 2005 and
2004, relates primarily to foreign income taxes. For the quarters
ended March 31, 2005 and 2004, as a result of the Cases, the
Company did not recognize any U.S. income or any tax benefits for
the losses incurred from its domestic operations (including
temporary differences) or any U.S. tax benefit for foreign income
taxes. Instead, the increases in federal and state deferred tax
assets as a result of the additional net operating losses and
foreign tax credits generated in 2005 and 2004 were fully offset
by increases in the valuation allowances.
(3) The Company has sold its interests in and related to Alpart,
Gramercy/KJBC, Valco and the Mead Facility. The Company completed
the sale of its interests in and related to QAL in April 2005. In
accordance with Generally Accepted Accounting Principles, the
operating results of these interests are reported as Discontinued
operations. Additional information with regard to Discontinued
operations is included in Note 4 of Notes to Interim Consolidated
Financial Statements in the Company's Quarterly Report on Form
10-Q for the quarter ended March 31, 2005. Results for
discontinued operations during the quarter ended March 31, 2004
included an approximate $33.0 impairment charge in respect of the
Company's interests in and related to Valco.
(4) Income (loss) per share may not be meaningful, because as a part
of a plan of reorganization, it is likely the interests of the
Company's existing stockholders will be cancelled without
consideration. See Note 2 of Notes to Interim Consolidated
Financial Statements in the Company's Quarterly Report on Form
10-Q for the quarter ended March 31, 2005.
KAISER ALUMINUM CORPORATION AND SUBSIDIARY COMPANIES
(Debtor-in-Possession)
SELECTED OPERATIONAL AND FINANCIAL INFORMATION
(Unaudited)
(In millions of dollars, except shipments and prices)
Quarter Ended
March 31,
-----------------------------
2005 2004
-------------- --------------
Shipments (mm lbs)
Fabricated Products 126.4 108.5
Primary Aluminum 38.4 38.8
-------------- --------------
164.8 147.3
============== ==============
Average Realized Third-Party Sales Price
(per pound):
Fabricated Products(1) $1.93 $1.65
Primary Aluminum(2) $.95 $.81
Net Sales:
Fabricated Products $244.4 $178.7
Primary Aluminum 37.0 31.5
-------------- --------------
Total Net Sales $281.4 $210.2
============== ==============
Segment Operating Income (Loss) - (3)
Fabricated Products $24.2 $1.3
Primary Aluminum 4.8 4.1
Corporate and Other (12.4) (15.7)
Other Operating Charges(4) (6.2) --
-------------- --------------
Total Operating Income (Loss) $10.4 $(10.3)
============== ==============
Discontinued operations $10.6 $(41.4)
============== ==============
Net Income (Loss) $8.3 $(64.0)
============== ==============
Capital expenditures (excluding
discontinued operations) $3.8 $1.6
============== ==============
(1) Average realized prices for the Company's Fabricated products
business unit are subject to fluctuations due to changes in
product mix as well as underlying primary aluminum prices and are
not necessarily indicative of changes in underlying profitability.
(2) Average realized prices for the Company's Primary aluminum
business unit exclude hedging revenues.
(3) The Company changed its segment presentation in 2004 to eliminate
the "Eliminations" segment as the primary purpose for such segment
was to eliminate the intercompany profit on sales by the Primary
aluminum and Bauxite and alumina business units, substantially all
of which are now considered Discontinued operations. Eliminations
not representing Discontinued operations are now included in
segment results. See Note 14 of Notes to Interim Consolidated
Financial Statements in the Company's Quarterly Report on Form
10-Q for the quarterly period ended March 31, 2005 for additional
information with regard to segment information.
(4) See Note 11 of Notes to Interim Consolidated Financial Statements
in the Company's Quarterly Report on Form 10-Q for the quarterly
period ended March 31, 2005, for information regarding Other
operating charges.
KAISER ALUMINUM CORPORATION AND SUBSIDIARY COMPANIES
(Debtor-in-Possession)
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In millions of dollars)
March 31, December 31,
2005 2004
-------------- --------------
Assets(1) (2)
Current assets(3) $272.3 $291.3
Discontinued operations' current
assets(2) 40.3 30.6
Investment in and advances to
unconsolidated affiliate 15.7 16.7
Property, plant, and equipment - net 213.4 214.6
Restricted proceeds from sale of
commodity interests 281.3 280.8
Personal injury-related insurance
recoveries receivable 967.0 967.0
Other assets 43.6 42.5
Discontinued operations' long-term
assets(2) 42.9 38.9
-------------- --------------
Total $1,876.5 $1,882.4
============== ==============
Liabilities & Stockholders' Equity
(Deficit)(1) (2)
Liabilities not subject to compromise -
Current liabilities(4) $185.3 $191.2
Discontinued operations' current
liabilities(2) 53.1 57.7
Long-term liabilities 33.3 32.9
Long-term debt 2.8 2.8
Discontinued operations' long-term
liabilities(2) 26.4 26.4
Liabilities subject to compromise 3,952.9 3,954.9
Minority interests .7 .7
Commitments and contingencies
Stockholders' equity (deficit) (2,378.0) (2,384.2)
-------------- --------------
Total $1,876.5 $1,882.4
============== ==============
(1) The Company and 25 of its subsidiaries have filed petitions for
reorganization under Chapter 11 of the United States Federal Code.
The balance sheet as of March 31, 2005, has been prepared on a
"going concern" basis, which contemplates the realization of
assets and liquidation of liabilities in the ordinary course of
business; however, as a result of the Chapter 11 filings, such
realization of assets and liquidation of liabilities are subject
to a significant number of uncertainties. Specifically, but not
all inclusive, the balance sheet does not present: (a) the
realizable value of assets on a liquidation basis or the
availability of such assets to satisfy liabilities, (b) the amount
which will ultimately be paid to settle liabilities and
contingencies which may be allowed or (c) the effect of any
changes which may be made in connection with the Company's
capitalization or operations resulting from a plan of
reorganization.
Upon emergence from the Chapter 11 proceedings, the Company
expects to apply "fresh start" accounting to its consolidated
financial statements as required by AICPA Statement of Position
90-7, Financial Reporting by Entities in Reorganization Under the
Bankruptcy Code. As such, the Company will restate its balance
sheet to equal the reorganization value as determined in its
plan(s) of reorganization and approved by the Court. Because fresh
start accounting will be adopted at emergence, and because of the
significance of liabilities subject to compromise (that will be
relieved upon emergence), comparisons between the current
historical financial statements and the financial statements upon
emergence may be difficult to make.
See Note 1 of Notes to Interim Consolidated Financial Statements
of the Company's Quarterly Report on Form 10-Q for the quarterly
period ended March 31, 2005 for additional information regarding
the Company's Chapter 11 proceedings.
(2) Information with regard to Discontinued operations is included in
Note 4 of Notes to Interim Consolidated Statements in the
Company's Quarterly Report on Form 10-Q for the quarterly period
ended March 31, 2005.
(3) Includes Cash and cash equivalents of $24.5 and $55.4 at March 31,
2005 and December 31, 2004, respectively.
(4) Includes Current portion of long-term debt of $1.2 at March 31,
2005 and December 31, 2004.