KALU US Equity☆

Item 7.Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes included in Item 8. “Financial Statements and Supplementary Data” of this Form 10-K. For a detailed discussion of items impacting the year ended December 31, 2023, as well as a year‐to‐year comparison of our financial position and results of operations for the years ended December 31, 2024 and December 31, 2023, refer to Part II, Item 7. “Management’s Discussion and Analysis” of our Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC on February 20, 2025.

Basis of Presentation

Effective January 1, 2025, we changed our inventory valuation methodology from LIFO to WAC. The effects of this change in accounting principle have been retrospectively applied to all periods presented with a cumulative effect adjustment reflected in the January 1, 2023 beginning retained earnings. See Note 18 of our consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data” of this Form 10-K for further information. Prior period information provided in this Management’s Discussion and Analysis has been updated to reflect the retrospective application of the change in accounting principle.

Non-GAAP Financial Measures

This information contains certain non-GAAP financial measures. A non-GAAP financial measure is defined as a numerical measure of a company’s financial performance that excludes or includes amounts so as to be different than the most directly comparable measure calculated and presented in accordance with US GAAP in the statements of income, balance sheets, or statements of cash flows of the company. We have provided a reconciliation of non-GAAP financial measures to the most directly comparable financial measure in the accompanying tables. We have also provided a discussion of the reasons we believe that presentation of the non-GAAP financial measures provides useful information to investors, as well as any additional ways in which we use the non-GAAP financial measures. The non-GAAP financial measures used in the following discussions are Conversion Revenue (defined as Net Sales less the Hedged Cost of Alloyed Metal, see below in “Metal Pricing Policies” discussion), Adjusted EBITDA and ratios related thereto. These measures are presented because management uses this information to monitor and evaluate financial results and trends and believes this information to also be useful for investors.

In the discussion of operating results below, we refer to certain items as “non-run-rate items.” For purposes of such discussion, non-run-rate items are items that, while they may recur from period-to-period: (i) are particularly material to results; (ii) affect costs primarily as a result of external market factors; and (iii) may not recur in future periods if the same level of underlying performance were to occur. Non-run-rate items are part of our business and operating environment but are worthy of being highlighted for the benefit of readers of our financial statements. Our intent is to allow users of the financial statements to consider our results both in light of and separately from such items. For a reconciliation of Conversion Revenue to Net sales and Adjusted EBITDA to Net income, see below in “Results of Operations - Selected Operational and Financial Information.”

Metal Pricing Policies

A fundamental part of our business model is to remain neutral to the impact from fluctuations in the market price for aluminum and certain alloys, thereby earning profit predominantly from the conversion of aluminum into semi-fabricated mill products. We refer to this as “metal price neutrality.” We purchase primary, rolling ingot and scrap, or recycled, aluminum, our main raw material, and alloys at prices that fluctuate on a monthly basis, and our pricing policies generally allow us to pass the current month underlying index cost of aluminum and certain alloys through to our customers so that we remain neutral to metal pricing. We may also enter into firm-price customer sales agreements that specify a firm underlying metal price plus a conversion price. Firm-price sales agreements create price exposure for us, which we mitigate through hedging and related programs with an objective to remain metal price neutral. Additionally, we have certain contracts that may adjust certain alloy prices for a forward period based on an average prior period cost for such alloys. As a result, until the selling price resets, we can experience an adverse impact when alloy prices increase and a favorable impact when alloy prices decrease.

In order to allow users of our financial statements to consider the impact of aluminum and alloy cost on our Net sales, we disclose Net sales as well as Conversion Revenue, which is Net sales less the Hedged Cost of Alloyed Metal. As used in this discussion, “Hedged Cost of Alloyed Metal” is the cost of aluminum at the average MWTP plus the cost of alloying elements and any realized gains and/or losses on settled hedges related to the metal sold in the referenced period. The average MWTP of aluminum reflects the primary aluminum supply/demand dynamics in North America. For a reconciliation of Conversion Revenue to Net sales, see below in “Results of Operations - Selected Operational and Financial Information.”

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Results of Operations

Fiscal 2025 Summary

•

Net income of $112.5 million and Net income per diluted share of $6.77;

•

Net sales of $3.37 billion; Conversion Revenue of $1.45 billion;

•

Adjusted EBITDA of $310.2 million;

•

Issuance of a new $500.0 million aggregate principal amount of 5.875% unsecured Senior Notes, due 2034 replacing the $500.0 million aggregate principal amount of 4.625% unsecured Senior Notes due in 2028;

•

As of December 31, 2025, we had $547.2 million of combined cash and cash equivalents and net borrowing availability under our Revolving Credit Facility; and

•

We paid a total of approximately $51.3 million, or $3.08 per common share, in cash dividends during 2025.

Consolidated Selected Operational and Financial Information

The following data should be read in conjunction with our consolidated financial statements and the notes thereto included in Item 8. “Financial Statements and Supplementary Data” of this Form 10-K.

Net Sales. The following table sets forth the 2025 and 2024 shipments (in millions of pounds) and Net sales (in millions of dollars) by end market applications and the respective fluctuations.

Year Ended December 31,

1.

Beginning January 1, 2025, Other Products is combined with GE Products.

The increase in Net sales reflected an increase in the average realized sales price per pound of $0.46 (18%). This benefit was partially offset by a 64.1 million pound (5%) decrease in shipment volume. The decrease in shipment volume primarily reflects the impact of a planned partial outage at our Trentwood facility in conjunction with the Phase VII capacity expansion project, destocking of plate products in the commercial aerospace portion of Aero/HS Products, and the delayed ramp up of our fourth coating line at our Warrick facility.

COGS. COGS for 2025 totaled $2,930.6 million, or 87% of Net sales, compared to $2,666.6 million, or 88% of Net sales, in 2024. The increase reflected the following (in millions of dollars):

Year Ended December 31,

2025 2024As Adjusted1 Change % Increase (Decrease)

1.

Adjusted to reflect the retrospective change in inventory valuation methodology from LIFO to WAC. See Note 18 to the Consolidated Financial Statements included in this Form 10-K for further discussion.

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Of the $352.0 million increase in Hedged Cost of Alloyed Metal, $437.7 million was due to an increase in underlying metal prices, partially offset by an $85.7 million decrease attributed to lower shipment volume (see above in our “Net Sales” discussion for further details). The $89.7 million decrease in manufacturing costs was primarily due to favorable metal consumption cost and lower shipment volume, partially offset primarily by lower manufacturing efficiencies associated with a planned partial outage at Trentwood for the Phase VII capacity expansion project and the commissioning and start-up of the fourth coating line at Warrick. The $7.5 million decrease in freight costs was primarily due to lower shipment volume. The $6.2 million increase in other cost of products sold was primarily driven by an increase in major maintenance costs, partially offset by a decrease in legacy environmental costs and a gain on the disposition of operating assets. See “Selected Operational and Financial Information” below for a further discussion of the comparative results of operations for 2025 and 2024.

Depreciation and Amortization. Depreciation and amortization for 2025 was $122.5 million compared to $116.4 million for 2024. The increase of $6.1 million was primarily attributable to the fourth coating line and Phase VII capacity growth initiatives being placed in service at Warrick and Trentwood, respectively.

Selling, General, Administrative, Research and Development (“SG&A and R&D”). SG&A and R&D expense totaled $129.2 million in 2025 compared to $120.8 million in 2024. The increase reflected the following (in millions of dollars), with employee costs being driven primarily by higher incentive costs:

Year Ended December 31,

Research and development costs $ 1.4 $ 2.2 $ (0.8 ) (36 %)

Other selling, general and administrative costs 35.4 35.3 0.1 0 %

Restructuring Costs. Restructuring costs of $1.9 million and $7.6 million for the years ended December 31, 2025 and 2024, respectively, reflect the impacts of our restructuring plans. See Note 12 of Notes to Consolidated Financial Statements included in this Form 10-K for further information regarding the restructuring plans.

Other Operating Charges, Net. Other operating charges, net, of $0.4 million for the year ended December 31, 2024 represented an impairment charge on land classified as held for sale.

Interest Expense. Interest expense represents cash and non-cash interest expense incurred on our Senior Notes and our Revolving Credit Facility, net of capitalized interest. See Note 9 of Notes to Consolidated Financial Statements included in this Form 10-K for further information regarding interest expense, capitalized interest expense, and a discussion of our debt and credit facilities that were in effect during each of the years 2025 and 2024.

Other Income, Net. See Note 13 of Notes to Consolidated Financial Statements included in this Form 10-K for details.

Income Tax Provision. The income tax provision for 2025 was $37.5 million, resulting in an effective tax rate of 25.0%. The income tax provision for 2024 was $22.3 million, resulting in an effective tax rate of 25.4%. There was no material difference between the effective tax rate and the projected blended statutory tax rate for either 2025 or 2024.

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Selected Operational and Financial Information

The following data should be read in conjunction with our consolidated financial statements and the notes thereto included in Part II, Item 8. “Financial Statements and Supplementary Data” of this Form 10-K.

The following table provides selected operational and financial information (in millions of dollars):

Year Ended December 31,

Other income, net (11.3 ) (19.5 )

Depreciation and amortization 122.5 116.4

Non-run-rate items:

Restructuring costs 1.9 7.6

Non-cash asset impairment charge — 0.4

Environmental expenses2 0.3 4.4

Gain on disposition of operating property, plant and equipment (3.3 ) —

Total non-run-rate items (1.1 ) 12.4

1.

Adjusted to reflect the retrospective change in inventory valuation methodology from LIFO to WAC. See Note 18 to the Consolidated Financial Statements included in this Form 10-K for further discussion.

2.

Non-run-rate environmental expenses are related to legacy contingencies from activities at operating facilities prior to July 6, 2006. See Note 10 to the Consolidated Financial Statements included in this Form 10-K for additional information relating to environmental expenses.

3.

Includes favorable Metal Price Lag of approximately $93.0 million and approximately $45.0 million for the years ended December 31, 2025 and 2024, respectively.

Adjusted EBITDA for 2025 was $69.2 million higher than Adjusted EBITDA for 2024. Adjusted EBITDA for the year ended December 31, 2025 was impacted by: (i) improved product pricing and mix and (ii) favorable metal consumption cost. This was partially offset by: (i) lower shipment volume; (ii) lower manufacturing efficiencies primarily due to costs associated with the Trentwood Phase VII outage and startup of the fourth coating line at Warrick; (iii) higher employee and employee-related costs, including higher incentive and benefits cost; and (iv) higher major maintenance costs. See above in “Consolidated Results of Operations” for further details.

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The following table provides our shipment and Conversion Revenue information (in millions of dollars, except shipments and Conversion Revenue per pound) by end market applications:

Year Ended December 31,

Aero/HS Products:

$ $ / lb $ $ / lb

Packaging:

$ $ / lb $ $ / lb

GE Products:

$ $ / lb $ $ / lb

Automotive Extrusions:

$ $ / lb $ $ / lb

Other Products1:

Shipments (mmlbs) — 4.3

$ $ / lb $ $ / lb

Net sales $ — $ — $ 10.1 $ 2.35

Less: Hedged Cost of Alloyed Metal — — (5.9 ) (1.37 )

Conversion Revenue $ — $ — $ 4.2 $ 0.98

Total:

$ $ / lb $ $ / lb

1.

Beginning January 1, 2025, Other Products is combined with GE Products.

2.

Hedged Cost of Alloyed Metal for 2025 and 2024 included $1,946.8 million and $1,567.6 million, respectively, reflecting the cost of aluminum at the average MWTP and the cost of certain alloys used in the production process, as well as metal price exposure on shipments that we hedged with realized gains (losses) upon settlement of $27.0 million and ($0.2) million in 2025 and 2024, respectively, all of which were included within both Net sales and COGS in our Statements of Consolidated Income. See Note 8 of Notes to Consolidated Financial Statements included in this Form 10-K for the total realized gains and losses on aluminum hedges for which we hedged the metal price exposure externally.

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Liquidity and Capital Resources

Summary

The following table summarizes our liquidity (in millions of dollars):

As of December 31,

Available cash and cash equivalents $ 7.0 $ 18.4

1.

Borrowing availability under the Revolving Credit Facility was determined by a borrowing base calculated as of December 31, 2025 and December 31, 2024. See Note 9 of Notes to Consolidated Financial Statements included in this Form 10-K for further details.

We place our cash in bank deposits with high credit quality financial institutions. See Note 16 of Notes to Consolidated Financial Statements included in this Form 10-K for information regarding restricted cash at December 31, 2025.

We had $22.3 million of outstanding borrowings under our Revolving Credit Facility as of December 31, 2025, reflecting borrowings of $653.3 million and repayments of $631.0 million during the year ended December 31, 2025, and we had no outstanding borrowings under our Revolving Credit Facility during the year ended December 31, 2024. See “Sources of Liquidity” below for a further discussion of subsequent borrowing activity.

Cash Flows

The following table summarizes our cash flows from operating, investing, and financing activities (in millions of dollars):

Year Ended December 31,

Total cash provided by (used in):

Investing activities $ (77.8 ) $ (174.6 )

Financing activities $ (44.6 ) $ (55.3 )

1.

Adjusted to reflect the retrospective change in inventory valuation methodology from LIFO to WAC. See Note 18 to the Consolidated Financial Statements included in this Form 10-K for further discussion.

Cash provided by operating activities for the year ended December 31, 2025 reflected results of business activity described within “Consolidated Selected Operational and Financial Information” above, as well as the following working capital changes: (i) an increase in inventory of $125.3 million primarily driven by higher metal costs, partially offset by a reduction in total inventory pounds; (ii) an increase in trade and other receivables of $81.9 million, primarily due to an increase in metal prices in addition to the timing of collections; (iii) an increase in accounts payable of $15.1 million due to an increase in metal costs in addition to the timing of payments; (iv) an increase in accrued liabilities of $13.4 million, primarily due to timing of uncleared cash disbursements; and (v) a decrease in contract assets of $10.0 million, primarily driven by timing of customer shipments.

Cash provided by operating activities for the year ended December 31, 2024 reflected results of business activity described within “Consolidated Selected Operational and Financial Information” above, as well as the following working capital changes: (i) an increase in inventory of $50.4 million, primarily driven by higher metal costs; (ii) an increase in contract assets of $14.9 million, primarily driven by timing of customer shipments; (iii) an increase in accounts payable of $14.1 million due to an increase in metal costs in addition to the timing of payments; and (iv) an increase in trade and other receivables of $4.5 million, primarily due to an increase in metal costs in addition to the timing of collections.

See Statements of Consolidated Cash Flows included in this Form 10-K for further details on our cash flows from operating, investing, and financing activities for the years ended December 31, 2025 and December 31, 2024.

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Sources of Liquidity

Our most significant sources of liquidity include available cash and cash equivalents, available credit under the Revolving Credit Facility, and funds generated from operations. We believe we have sufficient liquidity to fund our operations and meet our short-term and long-term obligations.

Our Revolving Credit Facility and outstanding Senior Notes have covenants that, we believe, allow us to operate our business with limited restrictions and significant flexibility for the foreseeable future. We do not believe that covenants contained in the Revolving Credit Facility are reasonably likely to limit our ability to raise additional debt or equity to satisfy our foreseeable liquidity needs during the next 12 months, should we choose to do so, nor do we believe it is likely that during the next 12 months, we will trigger the availability threshold that would require measuring and maintaining a fixed charge coverage ratio. During the fourth quarter of 2025, we entered into amendment No. 5 to our Revolving Credit Facility to, among other things, extend the maturity date to October 2030 and incorporate certain improved terms offering greater operational flexibility. See Note 9 of Notes to Consolidated Financial Statements included in this Report for further details.

At February 16, 2026, we had no outstanding borrowings under the Revolving Credit Facility after repaying borrowings of $62.4 million, including $40.1 million incurred subsequent to December 31, 2025. See Note 9 of Notes to Consolidated Financial Statements included in this Form 10-K for a description of our Revolving Credit Facility.

We engage in certain customer-based supply chain financing programs to accelerate the receipt of payment for outstanding accounts receivable from certain customers. The costs of these programs are typically reimbursed to us by the customer. Receivables transferred under these customer-based supply chain financing programs generally meet the requirements to be accounted for as sales resulting in the derecognition of such receivables from our consolidated balance sheets. Receivables involved with these customer‐based supply chain finance programs for the year ended December 31, 2025 constituted approximately 32% of our Net sales. See Note 1 and Note 13 of Notes to Consolidated Financial Statements included in this Form 10-K for further details with respect to these supply chain financing programs.

Material Cash Requirements

The discussion below summarizes our material cash requirements from significant contractual obligations, commercial commitments and off-balance sheet arrangements as of December 31, 2025.

Debt.As of December 31, 2025, we have outstanding fixed-rate notes with varying maturities for an aggregate principal amount of $1.05 billion. See Note 9 of Notes to Consolidated Financial Statements included in this Form 10-K for further details with respect to the 5.875% Senior Notes maturing in 2034 (“5.875% Senior Notes”) and the 4.50% Senior Notes maturing in 2031 (“4.50% Senior Notes”). At December 31, 2025, future interest payments associated with our outstanding notes total $380.6 million, with $48.9 million payable within 12 months. We do not believe that covenants in the indentures governing the outstanding Senior Notes are reasonably likely to limit our ability to obtain additional debt or equity financing should we choose to do so during the next 12 months.

Purchase Obligations. Cash outlays for purchase obligations consist primarily of commitments to purchase primary aluminum, recycled scrap aluminum, alloys, energy, and equipment. We have various contracts with suppliers of metals that require us to purchase minimum quantities of these metals in future years based primarily at the associated metal price at the time of payment. However, we believe the minimum required purchase quantities are lower than our current requirements for these metals. Physical delivery commitments with energy companies are in place to cover our exposure to fluctuations in utility prices and are based on fixed contractual rates and quantities. Equipment purchase obligations are based on scheduled payments to equipment manufacturers.

Leases. We have operating and finance leases for certain manufacturing facilities, warehouses, office space, equipment, and non-cancelable capital commitments. See Note 3 of Notes to Consolidated Financial Statements included in this Form 10-K for the maturity of our lease liabilities.

Deferred Compensation Plan Liability. As of December 31, 2025, we had deferred compensation plan liabilities for certain key employees, which were contingent upon investment performance, vesting and other eligibility requirements, including retirement dates. See Note 5 of Notes to Consolidated Financial Statements included in this Form 10-K for further information, including the total expense related to all benefit plans.

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Revolving Credit Facility. We are required to pay a monthly commitment fee, calculated at a rate of either 0.20% or 0.25% per annum (depending on average revolver usage), on the unused commitments under the Revolving Credit Facility. Borrowings of $22.3 millionwere outstanding under our Revolving Credit Facility as of December 31, 2025. Additionally, under our Revolving Credit Facility, we issue standby letters of credit to provide financial assurance of our payment of obligations, primarily related to workers’ compensation claims. The specific timing of payments with respect to such matters is uncertain. The letters of credit generally automatically renew every 12 months and terminate when the underlying obligations no longer require assurance or upon the maturity of our Revolving Credit Facility in October 2030. See Note 9 of Notes to Consolidated Financial Statements included in this Form 10-K for additional information.

Uncertain Tax Liabilities. At December 31, 2025, we had uncertain tax positions which ultimately could result in tax payments. See Note 14 of Notes to Consolidated Financial Statements included in this Form 10-K for further information.

Pension, OPEB, and Salaried VEBA. See Note 5 of Notes to Consolidated Financial Statements included in this Form 10-K for information regarding the future net benefits we expect to pay with respect to our pension plans, OPEB, and our variable cash contributions to the Salaried VEBA. Additionally, we are required to pay $0.3 million in annual administrative fees related to the hourly VEBA that provides benefits for eligible retirees represented by certain unions and their surviving spouses and eligible dependents through September 2030.

Multiemployer Pension Plans. See Note 6 of Notes to Consolidated Financial Statements included in this Form 10-K for information regarding the future contributions we expect to make under the terms of collective bargaining agreements that cover our union-represented employees at certain facilities. Additionally, in 2027 we expect to pay a partial withdrawal liability of approximately $4.6 million resulting from the exit of our soft alloy aluminum extrusion facility located in Sherman, Texas and the corresponding cessation of ongoing contributions to the multiemployer pension plan for those former covered employees.

While we believe our available cash on hand, anticipated available borrowing capacity under the Revolving Credit Facility, and funds generated from operations will be sufficient to finance our working capital requirements, planned capital expenditures, investments, debt service obligations and other cash requirements for at least the next 12 months, and while we also believe that alternative sources of liquidity will remain available in the event we seek to add liquidity for opportunistic or other reasons in the future, our ability to fund such cash requirements will depend upon our future operating performance (which will be affected by prevailing economic conditions) and financial, business and other factors, some of which are beyond our control.

Capital Expenditures and Investments

We strive to strengthen our competitive position across our end markets through strategic capital investment aimed at increasing our capacity and expanding our manufacturing capabilities. While some of our recent capital projects have focused on further enhancing manufacturing cost efficiency, improving product quality, and promoting operational security, a significant portion over the past several years related to our investment in a fourth coating line at Warrick to increase our capacity for higher margin coated aluminum material for packaging applications and the Trentwood modernization projects, which focused on equipment upgrades throughout the process flow to reduce conversion costs, increase efficiency, and further improve our competitive cost position on all products produced at Trentwood. A significant portion of the Trentwood investment also focused on modernizing legacy equipment and the process flow for thin gauge plate to achieve KaiserSelect® quality enhancements for these Aero/HS Products and GE Products. These improvements have allowed us to gain incremental manufacturing capacity to enable future sales growth. Total capital expenditures were $136.9 million in 2025 and $180.8 million in 2024.

Our capital investment plans remain focused on supporting demand growth through capacity expansion, sustaining our operations, enhancing product quality, and increasing operating efficiencies. We anticipate total capital spending in 2026 of approximately $120.0 million to $130.0 million. We expect to continue to deploy capital thoughtfully so that investment decisions align with demand expectations in order to maximize the earnings potential of the business and maintain financial strength and flexibility.

Capital investments will be funded using cash generated from operations, available cash and cash equivalents, borrowings under the Revolving Credit Facility, and/or other third-party financing arrangements. The level of anticipated capital expenditures may be adjusted from time to time depending on our business plans, our price outlook for fabricated aluminum products, our ability to maintain adequate liquidity, and other factors. No assurance can be provided as to the timing of any such expenditures or the operational benefits expected therefrom.

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Dividends

We have consistently paid a quarterly cash dividend since the second quarter of 2007 to holders of our common stock, including holders of restricted stock. Nevertheless, as in the past, the future declaration and payment of dividends, if any, will be at the discretion of our Board of Directors and will depend on a number of factors, including our financial and operating results, the availability of surplus and/or net profits, liquidity position, anticipated cash requirements, contractual restrictions under our Revolving Credit Facility, and the indentures for our outstanding Senior Notes or other indebtedness we may incur in the future. We can give no assurance that dividends will be declared and paid in the future.

We also pay quarterly dividend equivalents to the holders of certain restricted stock units. Holders of performance shares are not paid a quarterly dividend equivalent, but instead are entitled to receive, in connection with the issuance of underlying shares of common stock for performance shares that ultimately vest, a one-time payment equal to the dividends such holder would have received if the number of such shares of common stock so issued had been held of record by such holder from the date of grant of such performance shares through the date of such issuance.

See our Statements of Consolidated Stockholders’ Equity and Note 19 of Notes to Consolidated Financial Statements included in this Form 10-K for information regarding dividends declared during 2025 and 2024 and subsequent to December 31, 2025.

Repurchases of Common Stock

We are not obligated to repurchase any specific number of shares under our stock repurchase program. We suspended share repurchases as of March 2020. We will continue to assess share repurchases as a part of our capital allocation priorities and strategic investment opportunities identified to support further growth in our business. At December 31, 2025, $93.1 million remained authorized and available for future repurchases of common stock under our stock repurchase program. See our Statements of Consolidated Stockholders’ Equity included in this Form 10-K for information regarding minimum statutory tax withholding obligations arising during 2025 and 2024 in connection with the vesting of non-vested shares, restricted stock units, and performance shares.

Critical Accounting Estimates and Policies

Our consolidated financial statements are prepared in accordance with GAAP. In connection with the preparation of our financial statements, we are required to make assumptions and estimates about future events and apply judgments that affect the reported amounts of assets, liabilities, revenue and expenses and the related disclosures. We base our assumptions, estimates and judgments on historical experience, current trends and other factors that management believes to be relevant at the time our consolidated financial statements are prepared. On a regular basis, management reviews the accounting policies, assumptions, estimates and judgments to ensure that our financial statements are presented fairly and in accordance with GAAP. However, because future events and their effects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and such differences could be material.

In addition to the accounting estimates we discuss in Note 1 of Notes to Consolidated Financial Statements included in this Form 10-K, management believes that the following accounting estimates are critical to aid in fully understanding and evaluating our reported financial results and require management’s most difficult, subjective or complex judgments, resulting from the need to make estimates about the effects of matters that are inherently uncertain. Management has reviewed these critical accounting estimates and related disclosures with the Audit Committee of our Board of Directors.

Revenue Recognition

We decide at the outset of entering into contracts with customers whether our performance obligations as specified in these contracts are satisfied over time or at a point in time. To recognize revenue over time means that we will need to synchronize revenue recognition with progress toward completion of the performance obligation. If we have determined that revenue will be recognized over time for a specific customer order, the earliest point in our production process that we will recognize revenue will be the point that the product cannot be directed to another customer. In most cases, this happens at the time we begin to mold the ingot or billet, either by flat rolling the ingot or by extruding the billet through a die. For custom alloys, we would begin recognizing revenue over time at the point the custom alloy billet is cast. Approximately 78% of our business is recognized at a point in time with the remaining 22% recognized over time.

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We follow the input method of recognizing revenue over time. Under this approach, revenue is recognized for products in production based on the cost incurred to date plus a reasonable margin. Cost incurred to date is based on resources consumed, labor hours expended, and other costs incurred relative to the total inputs expected in order to satisfy a performance obligation. Reasonable margins are estimated using an average margin of the respective production facility producing the product. For purposes of recognizing revenue over time on products that are in work‐in-process as of the period end, we make the assumption that the average margins at the respective production facilities are reasonably close to the individual product margins that are in work‐in-process.

Although we believe that the judgments and estimates around recognizing revenue over time discussed herein are reasonable, actual results could differ and we may be exposed to losses or gains that could be material. For the portion of revenue recognized over time, a 5% change in our estimated average margins would have impacted Net income for the year ended December 31, 2025 by approximately $0.1 million.

Environmental Commitments and Contingencies

We are subject to environmental laws and regulations and may incur fines, penalties, or claims related to compliance. Based on our evaluation, we have recorded accruals primarily for solid waste disposal and soil and groundwater remediation. These accruals represent our best estimate of costs expected considering current laws, available information, and likely remediation actions.

Estimating environmental costs involves uncertainty, and actual results may differ. When a range of possible losses exists and no amount within the range is more likely, we record the minimum amount in accordance with ASC 450, Contingencies. Changes in facts, remediation plans, regulatory approvals, or technology could result in costs exceeding current accruals.

We believe our estimates are reasonable; however, actual costs could be materially higher or lower. It is reasonably possible that undiscounted costs may exceed current accruals by up to approximately $14.1 million over the remediation period. See Note 10 for additional details.

Pension and Other Postretirement and Postemployment Benefits

Our liabilities and expenses for pension and other postretirement and postemployment benefits are determined using actuarial methods and significant assumptions, including the discount rate, expected long-term rate of return (“LTRR”) on plan assets, and workforce-related factors such as salary growth, health care cost trends, retirement age, and mortality. The discount rate and expected LTRR are the most significant assumptions.

Changes in assumptions or plan provisions can materially affect obligations and expense. For example, a lower discount rate increases the present value of obligations, while a higher expected return reduces future expense. We also make variable annual contributions to the Salaried VEBA based on cash flow; the VEBA’s funding status does not affect our contribution amount. We have no control over any aspect of the Salaried VEBA plan and rely on information provided by the VEBA administrator for plan details.

A 0.25% change in the weighted average discount rate would impact the combined pension and other postretirement obligations by approximately $3.4 million as of December 31, 2025 and impact pretax earnings in 2026 by approximately $0.3 million. A 0.25% change in the expected LTRR would impact pretax earnings by about $0.2 million in 2026. See Note 5 for additional information.

New Accounting Pronouncements

For a discussion of all recently adopted and recently issued but not yet adopted accounting pronouncements, see Note 1 of Notes to Consolidated Financial Statements included in this Form 10-K.

Item 7A.Quantitative and Qualitative Disclosures About Market Risk

The following quantitative and qualitative disclosures about market risk should be read in conjunction with Note 8 and Note 11 of Notes to Consolidated Financial Statements included in this Form 10-K. Our operating results are sensitive to changes in the prices of primary aluminum, certain alloying metals, natural gas, electricity, foreign currency, and also depend to a significant degree upon the volume and mix of products sold to customers. We have historically utilized hedging transactions to lock in a specified price or range of prices for certain products which we sell or consume in our production process, and to mitigate our exposure to changes in energy prices.

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Aluminum

In 2025 and 2024, settlements of derivative contracts were for 126.7 million pounds and 154.9 million pounds, respectively, of hedged shipments sold on pricing terms that created aluminum price risk for us. At December 31, 2025, we had derivative contracts with respect to approximately 23.9 million pounds and 0.7 million pounds to hedge sales to be made in 2026 and 2027, respectively, on pricing terms that create aluminum price risk for us.

Based on the aluminum derivative positions held by us to hedge firm-price customer sales agreements, we estimate that a $0.10/lb decrease in the LME market price of aluminum as of December 31, 2025 and December 31, 2024, with all other variables held constant, would have resulted in an unrealized mark-to-market loss of $2.5 million and $4.7 million, respectively, with corresponding changes to the net fair value of our aluminum derivative positions. In addition, we estimate that a $0.05/lb decrease in the Midwest premium for aluminum as of December 31, 2025 and December 31, 2024, with all other variables held constant, would have resulted in an unrealized mark-to-market loss of $0.8 million and $2.0 million, respectively, with corresponding changes to the net fair value of our aluminum derivative positions.

Alloying Metals

We are exposed to the risk of fluctuating prices of certain alloying metals, especially copper, zinc, and magnesium, to the extent that changes in their prices do not highly correlate with price changes for aluminum. Copper, zinc, magnesium, and certain other metals are used in our remelt operations to cast rolling ingot and extrusion billet with the proper chemistry for our products. From time to time, we enter into forward contract swaps and/or physical delivery commitments with third parties to mitigate our risk from fluctuations in the prices of these alloys. As of December 31, 2025, we had forward swap contracts with settlement dates designed to align with the timing of scheduled purchases of copper and zinc by our manufacturing facilities. We estimate that a $0.10/lb decrease in the market price of zinc and copper as of December 31, 2025 and December 31, 2024, with all other variables held constant, would have resulted in an unrealized mark-to-market loss of $0.6 million and $0.9 million, respectively, with corresponding changes to the net fair value of our zinc and copper derivative positions.

Energy

We are exposed to the risk of fluctuating prices for natural gas and electricity. We, from time to time, in the ordinary course of business, enter into hedging transactions and/or physical delivery commitments with firm prices with third parties to mitigate our risk from fluctuations in natural gas and electricity prices. We estimate that a $1.00 per mmbtu decrease in natural gas prices would have resulted in an unrealized mark-to-market loss of $3.1 million and $2.8 million as of December 31, 2025 and December 31, 2024, respectively, with corresponding changes to the net fair value of our natural gas derivative positions. We had no outstanding electricity derivative positions as of December 31, 2025 or December 31, 2024.

Foreign Currency

As of December 31, 2025, we hedged the foreign currency exchange rate risk related to certain lease transactions and equipment purchases denominated in Euros using forward swap contracts with settlement dates through July 2027. We estimate that a 10% decrease in the exchange rate of our hedged foreign currencies to U.S. dollars would have resulted in an unrealized mark-to-market loss of $0.1 million and $0.8 million as of December 31, 2025 and December 31, 2024, respectively, with corresponding changes to the net fair value of our foreign currency derivative positions.

Our primary foreign exchange exposure is the operating costs of our London, Ontario facility. We estimate that a 10% change in the Canadian dollar exchange rate as of December 31, 2025 and December 31, 2024 would have resulted in an annual operating cost impact of $2.9 million and $2.8 million, respectively.

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KAISER ALUMINUM CORPORATION AND SUBSIDIARY COMPANIES

Item 8.Financial Statements and Supplementary Data

Report of Independent Registered Public Accounting Firm (PCAOB ID:34) 42

Consolidated Balance Sheets 44

Statements of Consolidated Income 45

Statements of Consolidated Comprehensive Income 46

Statements of Consolidated Stockholders’ Equity 47

Statements of Consolidated Cash Flows 48

Notes to Consolidated Financial Statements 49

41

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the shareholders and the Board of Directors of Kaiser Aluminum Corporation

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheets of Kaiser Aluminum Corporation and subsidiaries (the "Company") as of December 31, 2025 and 2024, the related consolidated statements of income, comprehensive income, stockholders' equity, and cash flows for each of the three years in the period ended December 31, 2025, and the related notes (collectively referred to as the "financial statements"). We also have audited the Company's internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO.

Change in Accounting Principle

As discussed in Note 18 to the financial statements, in 2025 the Company elected to change its method of accounting for determining the cost of inventory for finished goods, work in process, and raw materials from the last-in, first-out (LIFO) inventory accounting method to the weighted average cost (WAC) inventory accounting method. All periods presented in the financial statements have been adjusted to reflect this change.

Basis for Opinions

The Company's management is responsible for these financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Annual Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on these financial statements and an opinion on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the financial statements included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures to respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

Definition and Limitations of Internal Control over Financial Reporting

A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding

42

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (CONTINUED)

prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Revenue Recognition - Refer to Notes 1 and 17 to the financial statements

Critical Audit Matter Description

The Company recognizes revenue as it satisfies its performance obligations and transfers control of products to its customers. For products that have an alternative use and/or for which the Company does not have an enforceable right to payment (including a reasonable profit) during the production process, revenue is recognized at a point in time. For revenue recognized at a point in time, transfer of control usually occurs upon shipment or upon customer receipt of the product, depending on the shipping terms. For certain products with no alternative use and for which the Company has an enforceable right to payment (including a reasonable profit), revenue is recognized over time. For contracts recognized over time, control transfer occurs incrementally during the Company’s production process, as progress is made on fulfilling the performance obligation. The Company uses the input method of determining the progress, capturing direct costs beginning at the point that billet or cast ingot is introduced into production at either the extrusion phase or the rolling phase, respectively. For products in production, the Company recognizes revenue using estimates of the cost incurred to date plus a reasonable margin.

Contract assets represent amounts for work performed but not yet billed, including amounts related to finished goods in transit at period end.

Given the volume of contracts that are recognized over time and the complexity of the determination of over time revenue, we identified revenue for over time contracts as a critical audit matter.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to revenue recognized over time included the following, among others:

•

We tested management’s controls over revenue recognized over time, including those over cost incurred to date and estimates of reasonable margin.

•

We tested the mathematical accuracy of management’s calculation of revenue recognized over time and the related contract asset.

•

We selected a sample of invoices with customers and performed the following:

- We evaluated whether revenue was properly recognized as over time according to the contract terms with the customer.

- We tested that the revenue associated with work-in-process and finished goods inventory was properly recognized at December 31, 2025.

/s/ Deloitte & Touche LLP

Nashville, Tennessee

February 19, 2026

We have served as the Company's auditor since 2002.

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KAISER ALUMINUM CORPORATION AND SUBSIDIARY COMPANIES

CONSOLIDATED BALANCE SHEETS

As of December 31,

(In millions of dollars, except shareand per share amounts)

ASSETS

Current assets:

Cash and cash equivalents $ 7.0 $ 18.4

Receivables:

Prepaid expenses and other current assets 42.6 39.0

Operating lease assets 22.4 27.2

Deferred tax assets, net 0.2 4.0

Intangible assets, net 41.0 45.5

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

Accrued salaries, wages and related expenses 61.3 54.3

Other accrued liabilities 91.3 79.3

Long-term portion of operating lease liabilities 21.7 25.2

Deferred tax liabilities 75.4 44.1

Long-term liabilities 81.4 84.0

Commitments and contingencies – Note 10

Stockholders’ equity:

Accumulated other comprehensive income 26.8 20.5

Total liabilities and stockholders' equity $ 2,564.8 $ 2,409.9

1.

Adjusted to reflect the retrospective change in inventory valuation methodology from LIFO to WAC. See Note 18 for further discussion.

The accompanying notes to consolidated financial statements are an integral part of these statements.

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KAISER ALUMINUM CORPORATION AND SUBSIDIARY COMPANIES

STATEMENTS OF CONSOLIDATED INCOME

Year Ended December 31,

(In millions of dollars, except share and per share amounts)

Costs and expenses:

Selling, general, administrative, research and development 129.2 120.8 122.7

Restructuring costs 1.9 7.6 5.0

Other operating charges, net — 0.4 —

Other (expense) income:

Net income per common share:

Weighted-average number of common shares outstanding (in thousands):

1.

Adjusted to reflect the retrospective change in inventory valuation methodology from LIFO to WAC. See Note 18 for further discussion.

The accompanying notes to consolidated financial statements are an integral part of these statements.

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KAISER ALUMINUM CORPORATION AND SUBSIDIARY COMPANIES

STATEMENTS OF CONSOLIDATED COMPREHENSIVE INCOME

Year Ended December 31,

(In millions of dollars)

Other comprehensive income (loss), net of tax – Note 11:

Defined benefit plans 3.4 8.1 8.2

Cash flow hedges 2.9 (0.7 ) 1.7

Other comprehensive income, net of tax 6.3 7.4 9.9

1.

Adjusted to reflect the retrospective change in inventory valuation methodology from LIFO to WAC. See Note 18 for further discussion.

The accompanying notes to consolidated financial statements are an integral part of these statements.

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KAISER ALUMINUM CORPORATION AND SUBSIDIARY COMPANIES

STATEMENTS OF CONSOLIDATED STOCKHOLDERS’ EQUITY

(In millions of dollars, except share and per share amounts)

Other comprehensive income, net of tax — — — — — 9.9 9.9

Cash dividends declared2 — — — (50.4 ) — — (50.4 )

Amortization of unearned equity compensation — — 15.4 — — — 15.4

Other comprehensive income, net of tax — — — — — 7.4 7.4

Cash dividends declared2 — — — (50.7 ) — — (50.7 )

Amortization of unearned equity compensation — — 13.8 — — — 13.8

Other comprehensive income, net of tax — — — — — 6.3 6.3

Cash dividends declared2 — — — (51.3 ) — — (51.3 )

Amortization of unearned equity compensation — — 18.0 — — — 18.0

1.

Adjusted to reflect the retrospective change in inventory valuation methodology from LIFO to WAC. See Note 18 for further discussion.

2.

Dividends declared per common share were $3.08 for each of the years ended December 31, 2025, 2024, and 2023.

The accompanying notes to consolidated financial statements are an integral part of these statements.

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KAISER ALUMINUM CORPORATION AND SUBSIDIARY COMPANIES

STATEMENTS OF CONSOLIDATED CASH FLOWS

Year Ended December 31,

(In millions of dollars)

Cash flows from operating activities2:

Depreciation of property, plant and equipment 118.0 111.9 103.3

Amortization of definite-lived intangible assets 4.5 4.5 5.3

Amortization and write-off of debt issuance costs 4.5 2.3 2.2

Non-cash asset impairment charges3 2.0 3.6 —

Bad debt expense 0.4 0.3 —

Changes in operating assets and liabilities:

Trade and other receivables (81.9 ) (4.5 ) 33.1

Prepaid expenses and other current assets 1.0 (9.6 ) (2.8 )

Annual variable cash contributions to Salaried VEBA (0.7 ) (1.1 ) —

Long-term assets and liabilities, net (16.1 ) 2.6 (11.5 )

Cash flows from investing activities2:

Purchase of equity securities (0.4 ) (0.1 ) (0.3 )

Proceeds from sale of equity securities 6.4 0.3 0.1

Proceeds from disposition of property, plant and equipment 53.1 6.0 15.2

Net cash used in investing activities (77.8 ) (174.6 ) (128.2 )

Cash flows from financing activities2:

Borrowings under the Revolving Credit Facility 653.3 — 215.1

Repayment of borrowings under the Revolving Credit Facility (631.0 ) — (215.1 )

Issuance of 5.875% Senior Notes 500.0 — —

Repayment of principal of 4.625% Senior Notes (500.0 ) — —

Cash paid for debt issuance costs (10.1 ) — —

Repayment of finance lease (2.5 ) (2.5 ) (2.1 )

Cash dividends and dividend equivalents paid (51.3 ) (50.7 ) (50.4 )

Net cash used in financing activities (44.6 ) (55.3 ) (54.3 )

1.

Adjusted to reflect the retrospective change in inventory valuation methodology from LIFO to WAC. See Note 18 for further discussion.

2.

See Note 16 for supplemental disclosure of cash flow information.

3.

Non-cash asset impairment charges for the year ended December 31, 2025 are comprised of a $2.0 million write-down of certain replacement parts. Non-cash asset impairment charges for the year ended December 31, 2024 are comprised of: (i) a $3.2 million inventory write-down related to certain alloying metals and (ii) a $0.4 million impairment charge on land held for sale.

The accompanying notes to consolidated financial statements are an integral part of these statements.

48

Notes Index

KAISER ALUMINUM CORPORATION AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES INDEX

Note 1 Summary of Significant Accounting Policies 50

Note 2 Supplemental Balance Sheet Information 55

Note 3 Leases 56

Note 4 Goodwill and Intangible Assets 57

Note 5 Employee Benefits 58

Note 6 Multiemployer Pension Plans 63

Note 7 Employee Incentive Plans 63

Note 8 Derivatives, Hedging Programs and Other Financial Instruments 66

Note 9 Debt and Credit Facility 69

Note 10 Commitments and Contingencies 70

Note 11 Accumulated Other Comprehensive Income 72

Note 12 Restructuring 73

Note 13 Other Income, Net 73

Note 14 Income Tax Matters 74

Note 15 Net Income Per Share 78

Note 16 Supplemental Cash Flow Information 79

Note 18 Change in Accounting Principle 82

Note 19 Subsequent Events 84

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KAISER ALUMINUM CORPORATION AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Summary of Significant Accounting Policies

In this Form 10-K, unless the context otherwise requires, references in these notes to consolidated financial statements to “Kaiser Aluminum Corporation,” “Kaiser,” “we,” “us,” “our,” “the Company” and “our Company” refer collectively to Kaiser Aluminum Corporation and its subsidiaries.

Organization and Nature of Operations. Kaiser Aluminum Corporation specializes in the production of semi-fabricated specialty aluminum mill products, such as aluminum plate and sheet, bare and coated coil and extruded and drawn products, for the following end market applications: (i) Aero/HS Products; (ii) Packaging; (iii) GE Products; and (iv) Automotive Extrusions. Our business is organized into one operating segment. See Note 17 for additional information regarding our business, product and geographical area information and concentration of risk.

Principles of Consolidation and Basis of Presentation. Our consolidated financial statements include the accounts of our wholly owned subsidiaries and are prepared in accordance with GAAP and the rules and regulations of the SEC. Intercompany balances and transactions are eliminated. We have reclassified certain items in prior periods to conform to current classifications.

Use of Estimates in the Preparation of Financial Statements. The preparation of financial statements in accordance with GAAP requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities known to exist as of the date the financial statements are published and the reported amounts of revenues and expenses during the reporting period. Uncertainties with respect to such estimates and assumptions are inherent in the preparation of our consolidated financial statements; accordingly, it is possible that the actual results could differ from these estimates and assumptions, which could have a material effect on the reported amounts of our consolidated financial position and results of operations.

Fair Value Measurements. We apply the GAAP fair value hierarchy to measure certain assets and liabilities. Classification within the hierarchy is based on the lowest level input significant to the fair value measurement. We use valuation techniques that prioritize observable inputs and consider counterparty risk. Transfers between levels are assessed based on changes in inputs.

Recurring fair value measurements include derivative instruments (see Note 8) and equity investments related to our deferred compensation plan (see Note 5). Additionally, we measure at fair value once each year at December 31 the plan assets of our defined benefit pension and postretirement and postemployment plans, including the Salaried VEBA (see Note 5). In determining the fair value of the plan assets, we utilize the results of valuations supplied by the investment advisors responsible for managing the assets of each plan, which we independently review for reasonableness.

We believe that the fair values of our financial assets (accounts receivable, contract assets, current assets, accounts payable, and accrued liabilities) approximate their respective carrying values due to their short maturities and nominal credit risk. Most non-financial assets, such as inventories and long-lived assets, are not measured at fair value on a recurring basis. However, fair value may be assessed if impairment or other triggering events occur. See “Property, Plant and Equipment, Net” and “Goodwill and Intangible Assets” below for a discussion of impairment charges on long-lived physical assets. See Note 9 for the fair value of our Long-term debt, net.

Government Grants. We occasionally receive grants from state and local governments. Grants are recognized when we have reasonable assurance that we will meet the grant conditions and the funds will be received. Grants related to property, plant, and equipment reduce the carrying amount of the related asset. Grants intended to reimburse expenses already incurred or provide immediate financial support are recognized as income in the period they become receivable. The following table presents the total government assistance recognized during the year ended December 31, 2025 (in millions of dollars):

Grantor Grant Amount Duration Classification

Total $ 1.7

To be eligible to receive and keep the full amount of the IN EDGE Tax Credit, we must achieve: (i) minimum cumulative expenditures towards capital expenditures and (ii) a minimum number of full-time employees.

Cash and Cash Equivalents. We consider short-term, highly liquid investments with original maturities of 90 days or less to be cash equivalents. Our cash equivalents primarily consist of money market deposit accounts.

50

Notes Index

KAISER ALUMINUM CORPORATION AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Restricted Cash. We maintain certain cash deposits that are pledged or held as collateral for workers’ compensation and other agreements. These amounts are classified as restricted cash (see Note 16). Restricted funds may be released to us or additional amounts may be required to be pledged in the future.

Trade Receivables and Allowance for Credit Losses.Trade receivables primarily consist of amounts billed to customers for products sold, with payment terms generally between 30 to 90 days. We record an allowance for credit losses based on historical collection experience, current conditions, and reasonable forecasts. Factors considered include customer credit quality, aging of receivables, bankruptcy filings, and overall economic conditions. Specific allowances are recorded when we identify a customer’s inability or unwillingness to pay. Accounts are written off when deemed uncollectible, and any recoveries are recorded as a reduction of bad debt expense in the period received. In 2025, we wrote off $0.7 million of trade receivables. Write-offs in 2024 and 2023 were immaterial to our consolidated financial statements.

We have arrangements that allow us to sell certain customer trade receivables to those customers’ financial institutions without recourse. These sales are made at our discretion when the cost is lower than servicing the receivables with existing debt. After the sale, we retain no rights or obligations and do not service the receivables. Accordingly, these transactions are accounted for as sales (see Note 13).

Inventories. Inventories are stated at the lower of cost or net realizable value. Inventory costs include materials, labor, and manufacturing overhead. Abnormal costs, such as idle facility expenses, freight, handling, and spoilage, are expensed as incurred. See Note 2 for inventory components. Other inventories, consisting of operating supplies, are valued using the FIFO method.

Effective January 1, 2025, the Company changed its inventory valuation methodology for finished products, work-in-process, and raw materials from LIFO to WAC. This change is preferable because it improves the comparability of the Company’s operational results between periods by removing LIFO income or charge in a period resulting from LIFO valuation and changes to historical LIFO layers, better reflects the physical flow of goods, and simplifies the financial close process by utilizing the WAC valuation methodology for all internal and external reporting purposes. The effects of this change have been retrospectively applied to all prior periods presented. See Note 18 for additional details.

Replacement Parts. Replacement parts consist of equipment spare parts, which are valued using the FIFO method. Replacement parts are recorded within Prepaid expenses and other current assets or Other assets depending on whether the utilization of the replacement parts is expected to occur within the next 12 months.

Property, Plant and Equipment, Net. Property, plant and equipment, net, is recorded at cost and includes construction in progress (see Note 2). Interest on qualifying construction projects is capitalized (see Note 9).

Depreciation is computed using the straight-line method over estimated useful lives. Depreciable finance lease assets and leasehold improvements are amortized on a straight-line basis over the shorter of the estimated useful lives of the assets or the lease term. Depreciation expense is included in Depreciation and amortization within our Statements of Consolidated Income. The estimated useful lives are as follows:

Range(in years)

Land improvements 1-25

Buildings and leasehold improvements 2-45

Machinery and equipment 1-22

Depreciable finance lease assets 2-120

We review property, plant and equipment for impairment when events indicate the carrying amount may not be recoverable, using undiscounted cash flows to assess recoverability. We regularly assess whether events and circumstances with the potential to trigger impairment have occurred and rely on a number of factors, including operating results, business plans, economic projections, and anticipated future cash flow, to make such assessments. We use an estimate of the future undiscounted cash flows of the related asset or asset group over the estimated remaining life of such asset or asset group in measuring whether the asset or asset group is recoverable.

There were no impairment charges in 2025 or 2023. In 2024, we recorded a $0.4 million impairment on land classified as held for sale. Asset impairment charges are included in Other operating charges, net, in our Statements of Consolidated Income.

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Notes Index

KAISER ALUMINUM CORPORATION AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Assets are classified as held for sale when actively marketed and expected to sell within 12 months. These assets are measured at the lower of carrying amount or fair value less costs to sell.

Goodwill and Intangible Assets. Goodwill is tested for impairment annually in the fourth quarter or when events indicate potential impairment. We may perform a qualitative assessment or a quantitative test. In 2025, we completed a qualitative assessment and concluded that it is not more likely than not that the fair value of any reporting unit was below its carrying amount.

Intangible assets are initially recorded at fair value using an income approach and amortized over their estimated useful lives. We review intangible assets for impairment when circumstances indicate the carrying amount may not be recoverable. See Note 4 for discussion on goodwill and intangible assets.

Leases. We determine if an agreement contains a lease at inception. We have operating and finance leases for equipment and real estate, generally with fixed payments. Lease liabilities include options to extend or terminate when it is reasonably certain we will exercise them. Short-term leases (12 months or less) are not recorded on our Consolidated Balance Sheets. Because most leases do not provide an implicit rate, we use an incremental borrowing rate based on factors such as lease term, asset value, and our credit profile. We exclude non-lease components from lease liabilities and recognize variable lease payments as incurred. Operating lease expense is recognized on a straight-line basis over the lease term. Some equipment leases include return conditions, which we account for as residual value guarantees when probable. Our lease agreements do not contain material restrictive covenants.

Derivative Financial Instruments. We use derivative instruments to manage commodity price, energy cost, and foreign currency risks. We do not use derivatives for trading or speculative purposes. Derivatives are recorded at fair value on our Consolidated Balance Sheets. Those settling within one year are included in Prepaid expenses and other current assets or Other accrued liabilities. Derivatives settling after one year are included in Other assets or Long-term liabilities. Cash flows related to derivative instruments are classified in the Statements of Consolidated Cash Flows based on the nature of the underlying hedged item. See Note 8 for additional information.

Self-Insurance of Workers’ Compensation and Employee Healthcare Liabilities. We self-insure most workers’ compensation and employee healthcare costs and maintain insurance to limit exposure to large individual claims. Workers’ compensation liabilities include estimates for incurred but not reported claims and the ultimate cost of reported claims, based on historical experience and actuarial analysis. Accrued healthcare liabilities represent estimated unpaid medical and prescription costs provided by our plan administrators. These amounts were $7.9 million and $7.8 million at December 31, 2025 and December 31, 2024, respectively.

Debt Issuance and Deferred Financing Costs. Costs related to debt arrangements are capitalized and amortized over the term of the related borrowing. Amortization is included in Interest expense in our Statements of Consolidated Income. Unamortized debt issuance costs for Senior Notes are presented within Long-term debt, net on our Consolidated Balance Sheets. Unamortized deferred financing costs for the Revolving Credit Facility are presented in Other assets on our Consolidated Balance Sheets. When debt is extinguished, any remaining unamortized debt issuance or deferred financing costs are charged to Other income, net. For amendments or refinancings of the Revolving Credit Facility, such costs are written off only when the transaction is accounted for as an extinguishment; otherwise, the existing costs continue to be amortized over the term of the modified facility in accordance with ASC 470-50 (see Note 9).

Conditional Asset Retirement Obligations (“CAROs”). We have CAROs at certain manufacturing facilities, primarily related to (i) legal obligations for asbestos removal and disposal and (ii) future lease terminations. Most CAROs relate to asbestos that is contained within walls, floors, roofs, piping, or equipment insulation at older facilities. These costs would be incurred if the facilities undergo major renovation or demolition. We estimate the incremental removal and disposal costs, discount them to present value using a credit-adjusted, risk-free rate, and apply probability weighting when the timing of settlement is uncertain. See Note 10 for additional information.

Environmental Contingencies. We record environmental loss contingencies when they are probable and reasonably estimable (see Note 10). Accruals for remediation costs are generally recognized no later than the completion of the remedial feasibility study and are adjusted as new information becomes available. Future remediation costs are not discounted to their present value. Accrued environmental costs are included in Other accrued liabilities or Long-term liabilities, as appropriate (see Note 2). Environmental expenses for operating locations are included in COGS, while expenses for non-operating locations are included in SG&A and R&D in our Statements of Consolidated Income.

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Notes Index

KAISER ALUMINUM CORPORATION AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Revenue Recognition. We recognize revenue as we satisfy performance obligations and transfer control of products to our customers. For products that have an alternative use and/or for which we do not have an enforceable right to payment (including a reasonable profit) during the production process, we recognize revenue at a point in time. For revenue recognized at a point in time, transfer of control usually occurs upon shipment or upon customer receipt of the product, depending on shipping terms. For certain products with no alternative use and where we have an enforceable right to payment (including a reasonable profit), revenue is recognized over time. For contracts recognized over time, control transfer occurs incrementally during our production process as progress is made on fulfilling the performance obligation. We use the input method of determining our progress, capturing direct costs beginning at the point that billet or cast ingot is introduced into production at either the extrusion phase or the rolling phase, respectively. We believe the input method more accurately reflects the transfer of control as it represents the best information available of work completed to date for which we have an enforceable right to payment. For products in production, we recognize revenue using estimates of the cost incurred to date plus a reasonable margin. As the duration of our contracts for accounting purposes is typically less than one year, we do not present quantitative information about the aggregate transaction price allocated to unsatisfied performance obligations at the end of the reporting period.

Contracts are generally short-term and based on customer purchase orders, although purchase orders may reference a longer term “blanket purchase order” or a “terms and conditions” agreement, both of which may span multiple years. We adjust revenue for variable consideration such as metal price adjustments, volume rebates, and sales discounts, estimated based on forecasted order data and historical payment trends for specific customers. Accounts receivable is recorded when our right to payment becomes unconditional. We do not adjust for financing components as payment terms are generally less than one year.

Contract assets represent amounts for work performed but not yet billed, including amounts related to finished goods in transit at period end.

Incremental Costs of Obtaining a Contract. We expense the costs of obtaining a contract as incurred if the amortization period of the asset that we otherwise would have recognized is one year or less. If the expected benefit exceeds one year, the costs are recorded as an asset to Other assets on our Consolidated Balance Sheets and amortized over the term of the contract.

Shipping and Handling Activities. We account for shipping and handling activities that occur after the customer has obtained control of a product as fulfillment activities (i.e., an expense) rather than as a promised service (i.e., a revenue element).

Advertising Costs. Advertising costs, which are included in SG&A and R&D, are expensed as incurred. Advertising costs for 2025, 2024, and 2023 were $0.3 million, $0.4 million, and $0.1 million, respectively.

Research and Development Costs. Research and development costs, which are included in SG&A and R&D, are expensed as incurred. Research and development costs, inclusive of personnel costs, for 2025, 2024, and 2023 were $10.7 million, $12.0 million and $11.1 million, respectively.

Stock-Based Compensation. We grant stock-based compensation to executives, certain employees, and non-employee directors in the form of service-based and performance-based awards. Compensation cost is measured at grant-date fair value and recognized over the service period, generally on a straight-line basis. Forfeitures are accounted for as they occur. Service-based awards are valued using the market price of our common stock on the grant date. Performance-based awards are valued based on the type of performance condition. Market-based awards, such as those tied to total shareholder return, are valued using a Monte Carlo model. Non-market performance-based awards are valued using our stock price at grant. Holders of performance-based awards receive a one-time dividend equivalent payment when vested shares are issued. Expense for market-based awards is recognized if the service condition is met, regardless of market performance. For non-market awards, expense is adjusted quarterly based on the most probable outcome. See Note 7 for additional details.

Adoption of New Accounting Pronouncements

Income Taxes. In December 2023, the FASB issued ASU No. 2023-09 (“ASU 2023-09”), Improvements to Income Tax Disclosures. The guidance is primarily intended to improve income tax disclosure requirements by requiring (i) consistent categories and greater disaggregation of information in the rate reconciliation and (ii) the disaggregation of income taxes paid by jurisdiction. The guidance makes several other changes to the income tax disclosure requirements. The amendments in ASU 2023-09 are effective for fiscal years beginning after December 15, 2024, with early adoption permitted, and is required to be applied prospectively with the option of retrospective application. We adopted ASU 2023-09 effective December 31, 2025 using a retrospective approach. See Note 14 for the required disclosures related to our adoption of ASU 2023-09. This standard update did not affect our operating results.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Credit Losses for Accounts Receivable and Contract Assets. In July 2025, the FASB issued ASU No. 2025-05 (“ASU 2025-05”), Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets, which provides entities with a practical expedient to simplify the estimation of expected credit losses by assuming that the current conditions as of the balance sheet date will not change for the remaining life of the asset. We adopted ASU 2025-05 effective December 31, 2025 using a prospective approach. The adoption of this ASU did not have a material impact on our consolidated financial statements.

Accounting Pronouncements Issued But Not Yet Adopted

Disclosure Improvements. In October 2023, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2023-06 (“ASU 2023-06”), Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative. The guidance amends GAAP to reflect updates and simplifications to certain disclosure requirements referred to the FASB by the SEC. The amendments in ASU 2023-06 will become effective on the date which the SEC’s removal of the related disclosure becomes effective. If by June 30, 2027, the SEC does not remove the related disclosure, the pending amendment will be removed from ASC 2023-06 and it will not be effective. Adoption of ASU 2023-06 is expected to modify the disclosure and presentation requirements only and is not expected to have a material impact on our consolidated financial statements.

Disaggregation of Income Statement Expenses. In November 2024, the FASB issued ASU No. 2024-03 (“ASU 2024-03”), Disaggregation of Income Statement Expenses. The guidance requires additional, disaggregated disclosure about certain income statement expense line items. The amendments in ASU 2024-03 are effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027, with early adoption permitted, and is required to be applied prospectively with the option of retrospective application. We plan to adopt the provisions of ASU 2024-03 prospectively in the fourth quarter of fiscal 2027 and continue to evaluate the disclosure requirements related to the new standard.

Accounting for Internal-Use Software. In September 2025, the FASB issued ASU No. 2025-06 (“ASU 2025-06”), Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which improves the operability of the guidance by removing all references to software development stages so that the guidance is neutral to different software development methods. ASU 2025-06 is effective for fiscal years beginning after December 15, 2027 and interim reporting periods within those annual reporting periods, with early adoption permitted as of the beginning of the annual reporting period. The amendments may be applied by using a prospective transition approach, a retrospective transition approach, or a modified transition approach based on the status of the project and whether software costs were capitalized before the date of adoption. We are currently evaluating the impact of this pronouncement on our consolidated financial statements.

Hedge Accounting Improvements. In November 2025, the FASB issued ASU No. 2025-09 (“ASU 2025-09”), Derivatives and Hedging (Topic 815): Hedge Accounting Improvements. The guidance introduces targeted refinements intended to improve the operability of hedge accounting and better align financial reporting with risk management activities, including greater flexibility in hedge designation and clarifications for certain instruments. ASU 2025-09 is effective for fiscal years beginning after December 15, 2026, with early adoption permitted. We are currently evaluating the impact of this pronouncement on our consolidated financial statements.

Government Grants. In December 2025, the FASB issued ASU No. 2025-10 (“ASU 2025-10”), Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities, to establish authoritative guidance on the accounting for government grants received by business entities. ASU 2025-10 is effective for fiscal years beginning after December 15, 2028, with early adoption permitted, and is required to be applied using a modified prospective, modified retrospective, or full retrospective transition method. We are currently evaluating the impact of this pronouncement on our consolidated financial statements.

Interim Reporting Narrow-Scope Improvements. In December 2025, the FASB issued ASU No. 2025-11 (“ASU 2025-11”), Interim Reporting (Topic 270): Narrow-Scope Improvements, which clarifies the scope, form and content, and required disclosures in interim financial statements prepared under GAAP. ASU 2025-11 enhances guidance for entities that issue condensed interim statements and reinstates a principles-based requirement to disclose material events since the last annual period. ASU 2025-11 is effective for interim periods in fiscal years beginning after December 15, 2027, with early adoption permitted and retrospective application optional. We are currently evaluating the impact of this standard on our consolidated financial statements.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

2. Supplemental Balance Sheet Information

As of December 31,

(In millions of dollars)

Trade Receivables, Net

Allowance for doubtful receivables (0.6 ) (0.8 )

Inventories

Property, Plant and Equipment, Net

Land and improvements $ 38.2 $ 37.2

Buildings and leasehold improvements 302.6 256.3

Property, plant and equipment, gross 1,994.2 1,928.4

Accumulated depreciation and amortization (849.1 ) (767.5 )

Land held for sale 0.1 0.3

Property, plant and equipment, net $ 1,145.2 $ 1,161.2

Other Assets

Assets to be conveyed associated with Warrick acquisition2 $ — $ 18.3

Long-term replacement parts 28.5 18.3

Net assets of Salaried VEBA – Note 5 9.7 —

.

Other Accrued Liabilities

Uncleared cash disbursements $ 45.8 $ 24.5

Accrued income taxes and other taxes payable 7.8 11.1

Accrued annual contribution to Salaried VEBA – Note 5 2.9 0.7

Accrued interest 6.9 9.9

Current operating lease liabilities – Note 3 4.8 6.3

Current finance lease liabilities – Note 3 2.3 2.4

Current deferred compensation plan liabilities – Note 5 1.2 6.7

Other accrued liabilities $ 91.3 $ 79.3

Long-Term Liabilities

Workers' compensation accrual $ 26.0 $ 26.8

Long-term environmental accrual – Note 10 17.4 17.7

Other long-term liabilities 38.0 39.5

Long-term liabilities $ 81.4 $ 84.0

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.

Adjusted to reflect the retrospective change in inventory valuation methodology from LIFO to WAC. See Note 18 for further discussion.

2.

During the year ended December 31, 2025, all of the remaining assets associated with our acquisition of Warrick were conveyed to us and placed in service. At December 31, 2025, such assets are presented within Machinery and equipment.

3. Leases

The following table summarizes key finance and operating lease terms and discount rates:

As of December 31,

Weighted-average remaining lease term (in years):

Operating leases 8.8 8.9

Weighted-average discount rate:

The following table summarizes the classification of lease assets and lease liabilities on our Consolidated Balance Sheets (in millions of dollars):

As of December 31,

Operating lease assets Operating lease assets $ 22.4 $ 27.2

Finance lease assets Property, plant and equipment, net $ 14.1 $ 14.8

Current operating lease liabilities Other accrued liabilities $ 4.8 $ 6.3

Total operating lease liabilities $ 26.5 $ 31.5

Current finance lease liabilities Other accrued liabilities $ 2.3 $ 2.4

Non-current finance lease liabilities Long-term liabilities $ 12.4 $ 13.0

Total finance lease liabilities $ 14.7 $ 15.4

The following table summarizes the components of lease cost in our Statements of Consolidated Income (in millions of dollars):

Year Ended December 31,

Short-term lease cost 6.2 4.0 4.3

Finance lease cost:

Amortization of leased assets 2.4 2.4 2.4

Interest on lease liabilities 0.8 0.8 0.7

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The following table presents the maturity of our lease liabilities as of December 31, 2025 (in millions of dollars):

Finance Leases Operating Leases

Total minimum lease payments $ 33.8 $ 33.8

Less: interest (19.1 ) (7.3 )

4. Goodwill and Intangible Assets

Goodwill. We identified no indicators of goodwill impairment during the years ended December 31, 2025, 2024, and 2023.

The following table presents the changes in the carrying value of our goodwill (in millions of dollars):

As of December 31,

Accumulated impairment loss1 (38.9 ) (38.9 )

Net carrying value $ 18.8 $ 18.8

1.

The gross carrying value and accumulated impairment loss excludes $25.2 million of goodwill recorded in conjunction with our acquisition of IMT.

Intangible Assets. The following table presents the gross carrying amount and accumulated amortization of our intangible assets by major intangible asset class (in millions of dollars):

GrossAmount AccumulatedAmortization IntangibleAssets, Net

Customer relationships $ 68.1 $ (34.5 ) $ 33.6

Favorable lease contracts 7.0 (0.3 ) 6.7

Customer relationships $ 68.1 $ (30.3 ) $ 37.8

Non-compete agreement 5.4 (5.4 ) —

Favorable lease contracts 7.0 (0.2 ) 6.8

We identified no indicators of impairment associated with our intangible assets during the years ended December 31, 2025, 2024, and 2023.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Amortization expense relating to definite-lived intangible assets was $4.5 million, $4.5 million and $5.3 million for 2025, 2024, and 2023, respectively. The following table presents the expected amortization of intangible assets for each of the next five calendar years and thereafter as of December 31, 2025 (in millions of dollars):

5. Employee Benefits

Defined Contribution Plans

We sponsor defined contribution savings plans for certain hourly and salaried employees. Employees may contribute a portion of their compensation to the plans, and we match a specified percentage of these contributions in equivalent form of the investments elected by the employee. In addition, we make fixed annual contributions for certain hourly and salaried employees in varying amounts depending on hire date.

Deferred Compensation Plan

We sponsor a non-qualified, unfunded, unsecured plan of deferred compensation for certain employees who would otherwise suffer a loss of benefits under our defined contribution plan as a result of the limitations imposed by the Internal Revenue Code of 1986. Despite the plan being an unfunded plan, we make an annual contribution to a rabbi trust to fulfill future funding obligations, as contemplated by the terms of the plan. The assets in the trust are held in various investment funds at certain registered investment companies (see discussion below in “Fair Value of Plan Assets”) and are at all times subject to the claims of our general creditors. No participant has a claim to any assets of the trust; however, participants are eligible to receive distributions from the trust subject to vesting and other eligibility requirements. Offsetting liabilities relating to the deferred compensation plan are included within Other accrued liabilities and Long-term liabilities. Assets in the trust are accounted for as equity investments with changes in fair value recorded within Other income, net (see Note 13).

Other Benefits

We provide other benefits for certain members of senior management, including certain of our named executive officers, related to terminations of employment in specified circumstances, including in connection with a change in control, by us without cause and by the executive officer with good reason.

Defined Benefit Plans

Pension. We sponsor defined benefit pension plans for certain hourly bargaining unit employees and salaried employees. Pension benefits generally depend on length of service, job grade, and remuneration. Substantially all benefits are paid through pension trusts that are sufficiently funded to ensure that all plans can pay benefits to retirees as they become due. We use a December 31 measurement date for our pension plans.

OPEB. We sponsor an OPEB plan covering certain eligible retirees. Generally, the medical plans are unfunded and pay a percentage of medical expenses, reduced by deductibles and other coverage. Life insurance benefits are generally provided by insurance contracts. We use a December 31 measurement date for our OPEB plan.

Salaried VEBA Postretirement Obligation. Certain retirees who retired prior to 2004 and certain employees who were hired prior to February 2002 and have subsequently retired or will retire with the requisite age and service, along with their surviving spouses and eligible dependents, are eligible to participate in a Salaried VEBA. The accumulated postretirement benefit obligation (“APBO”) for the Salaried VEBA was computed based on the level of benefits being provided. Since the Salaried VEBA pays out a fixed annual amount to its participants, no future cost trend rate increase was assumed in computing the APBO for the Salaried VEBA.

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We have an ongoing obligation with no express termination date to make variable cash contributions up to a maximum of $2.9 million annually to the Salaried VEBA. The Salaried VEBA assets are invested in various managed funds based on information we received from the trustee of the Salaried VEBA. Our variable payment, if any, is treated as a funding/contribution policy and not counted as a Salaried VEBA asset at the accrual date for actuarial purposes. We determined that in the first quarter of 2026 we will pay $2.9 million with respect to 2025. During the first quarter of 2025, we paid $0.7 million with respect to 2024. Such amounts were recorded within Other accrued liabilities (see Note 2). We account for the Salaried VEBA as a defined benefit plan in our financial statements using a December 31 measurement date.

Key Assumptions. The following table presents the weighted average assumptions used to determine benefit obligations:

Pension Plans1 OPEB Salaried VEBA

As of December 31, As of December 31, As of December 31,

Rate of compensation increase 2.56 % 2.56 % — % — % — % — %

1.

Assumptions for our pension plans are weighted based on the total benefit obligations of each.

In measuring the benefit obligation under our OPEB plan, we estimate a healthcare cost trend rate representing the annual rates of change in the costs of the healthcare benefits currently provided. The 2025 actuarial valuation assumed an 8.5% annual rate of increase in the per capita cost of covered healthcare claims with the rate decreasing gradually until reaching 4.5% in 2039.

The following table presents the weighted average assumptions used to determine net periodic postretirement and postemployment benefit cost:

Pension Plans1 OPEB Salaried VEBA

Year Ended December 31, Year Ended December 31, Year Ended December 31,

Rate of compensation increase 2.56 % 2.56 % 2.63 % — % — % — % — % — % — %

1.

Assumptions for our pension plans are weighted based on the total benefit obligations of each.

2.

The expected long-term rate of return assumption for the Salaried VEBA is based on the targeted investment portfolios provided to us by the trustee of the Salaried VEBA.

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Benefit Obligations and Funded Status. The following table presents the benefit obligations and funded status of our pension plans, OPEB, and the Salaried VEBA and the corresponding amounts that are included in our Consolidated Balance Sheets (in millions of dollars):

Pension Plans OPEB Salaried VEBA

As of December 31, As of December 31, As of December 31,

Change in benefit obligation:

Foreign currency translation loss (gain) 0.2 (0.5 ) — — — —

Prior service cost1 — 2.2 — — — —

Plan participants contributions 0.1 0.1 0.2 0.2 — —

Settlements3 — (4.5 ) — — — —

Change in plan assets:

Fair market value of plan assets at beginning of year 22.5 20.5 — — 42.9 43.1

Foreign currency translation gain 0.2 0.3 — — — —

Actual return on assets 1.9 0.9 — — 6.7 3.9

Plan participants contributions 0.1 0.1 0.2 0.2 — —

Settlements3 — (4.5 ) — — — —

Fair market value of plan assets at end of year 30.2 22.5 — — 47.8 42.9

Net funded status $ (5.8 ) $ (8.2 ) $ (70.0 ) $ (64.7 ) $ 9.7 $ —

Amounts recognized on our Consolidated Balance Sheets:

Other assets $ 1.3 $ 1.6 $ — $ — $ 9.7 $ —

Accrued salaries, wages and related expenses — — (3.7 ) (3.1 ) — —

Cumulative gain (loss) recognized in AOCI:

Prior service cost (6.7 ) (7.6 ) — — (11.3 ) (14.3 )

1.

In 2024, prior service cost for our pension plans resulted from a plan amendment clarifying certain plan provisions of the Kaiser Aluminum Warrick pension plan going back to the date of our acquisition of Warrick.

2.

Actuarial gains and losses for our defined benefit plans primarily resulted from changes in certain key actuarial assumptions and updates to census data.

3.

In 2024, we entered into a group annuity purchase agreement under which approximately $4.5 million of obligations for certain participants of the Kaiser Aluminum Canada Limited Retirement Plan for Salaried Employees were transferred to an insurance company. The annuitization was funded through existing plan assets and does not change the amount of the monthly pension benefits received by the affected participants.

4.

For the pension plans, the benefit obligation is the projected benefit obligation. For the Salaried VEBA and OPEB, the benefit obligation is the APBO.

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The accumulated benefit obligation for the pension plans was $35.2 million and $29.8 million at December 31, 2025 and December 31, 2024, respectively. We expect to contribute $5.2 million to the pension plans in 2026.

The following table presents the net benefits expected to be paid (in millions of dollars):

Year Ended December 31,

1.

Such amounts are based on benefit amounts and certain key assumptions obtained from the Salaried VEBA trustees and will be paid out of the Salaried VEBA plan assets. We have an ongoing obligation to make variable cash contributions to the Salaried VEBA, up to a maximum of $2.9 million annually based on our cash flow.

Plan Assets. The fundamental goal underlying our pension plan investment policy is to ensure that the assets of the plans are invested in a prudent manner to earn a long-term rate of return sufficient to meet the benefit obligations as they come due. Risk management practices include diversification across asset classes and periodic rebalancing toward established asset allocation targets. Our investment policy permits variances from the targets within certain parameters.

The following table presents the weighted-average target and actual asset class allocations for our pension plans:

Asset class 2025 Target allocation As of December 31, 2025

Real estate investments 6% 6%