Condensed Guarantor and Non-Guarantor Financial Information

During the quarter ended June 30, 2016, we issued $375.0 million aggregate principal amount of our 5.875% Senior Notes and redeemed in full the remaining principal balance of our 8.25% Senior Notes. The 5.875% Senior Notes were issued by Kaiser Aluminum Corporation ("Parent") pursuant to an indenture dated May 12, 2016 ("Indenture") with Wells Fargo Bank, National Association, as trustee ("Trustee"). The obligations of the Parent under the Indenture are guaranteed by Kaiser Aluminum Investments Company, Kaiser Aluminum Fabricated Products, LLC and Kaiser Aluminum Washington, LLC, ("Guarantor Subsidiaries"). An additional Guarantor Subsidiary, Kaiser Aluminum Alexco, LLC, merged with and into Kaiser Aluminum Fabricated Products, LLC during the first quarter of 2017. All Guarantor Subsidiaries are 100% owned by the Parent. The guarantees are full and unconditional and joint and several but have customary releases in the following situations: (i) the sale of the Guarantor Subsidiary or all of its assets; (ii) the declaration of a Guarantor Subsidiary as an unrestricted subsidiary under the Indenture; (iii) the termination or release of the Guarantor Subsidiary's guarantee of certain other indebtedness; or (iv) our exercise of legal defeasance or covenant defeasance or the discharge of our obligations under the Indenture.

The following condensed consolidating financial information as of March 31, 2017 and December 31, 2016, and for the quarters ended March 31, 2017 and March 31, 2016 present: (i) the financial position, results of operation and cash flows for each of (a) Parent, (b) the Guarantor Subsidiaries on a combined basis and (c) the Non-Guarantor Subsidiaries on a combined basis; (ii) the "Consolidating Adjustments," which represent the adjustments necessary to eliminate the investments in our subsidiaries, other intercompany balances and other intercompany sales and cost of sales among Parent, the Guarantor Subsidiaries and the Non-Guarantor Subsidiaries; and (iii) the resulting totals, reflecting information for us on a consolidated basis, as reported. The condensed consolidating financial information should be read in conjunction with the consolidated financial statements herein.

CONDENSED CONSOLIDATING BALANCE SHEET

(In millions of dollars)

March 31, 2017



	Parent		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Adjustments			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	—	$	29.7	$	4.7	$	—		$	34.4
Short-term investments	—		195.5		—		—			195.5
Receivables:
Trade receivables – net	—		151.5		5.5		—			157.0
Intercompany loans receivable	85.8		0.1		0.6		(86.5		)	—
Other	—		10.9		0.9		—			11.8
Inventories	—		199.7		8.0		(4.2		)	203.5
Prepaid expenses and other current assets	0.1		33.5		0.4		—			34.0
Total current assets	85.9		620.9		20.1		(90.7		)	636.2
Investments in and advances to subsidiaries	1,059.1		40.5		—		(1,099.6		)	—
Property, plant and equipment – net	—		504.9		30.9		—			535.8
Long-term intercompany loans receivable	33.6		—		4.2		(37.8		)	—
Deferred tax assets – net	—		136.0		—		4.8			140.8
Intangible assets – net	—		26.0		—		—			26.0
Goodwill	—		37.2		—		—			37.2
Other assets	—		37.1		—		—			37.1
Total	$	1,178.6	$	1,402.6	$	55.2	$	(1,223.3	)	$	1,413.1
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	2.7	$	76.1	$	5.6	$	—		$	84.4
Intercompany loans payable	—		86.4		0.1		(86.5		)	—
Accrued salaries, wages and related expenses	—		27.8		1.3		—			29.1
Other accrued liabilities	8.4		34.4		0.1		(2.5		)	40.4
Total current liabilities	11.1		224.7		7.1		(89.0		)	153.9
Net liabilities of Salaried VEBA	—		28.3		—		—			28.3
Deferred tax liabilities	—		—		3.3		—			3.3
Long-term intercompany loans payable	—		37.8		—		(37.8		)	—
Long-term liabilities	—		57.4		2.7		—			60.1
Long-term debt	368.9		—		—		—			368.9
Total liabilities	380.0		348.2		13.1		(126.8		)	614.5

Total stockholders' equity	798.6		1,054.4		42.1		(1,096.5		)	798.6
Total	$	1,178.6	$	1,402.6	$	55.2	$	(1,223.3	)	$	1,413.1

CONDENSED CONSOLIDATING BALANCE SHEET

(In millions of dollars)

December 31, 2016



	Parent		Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	—	$	52.9	$	2.3		$	—		$	55.2
Short-term investments	—		231.0		—			—			231.0
Receivables:
Trade receivables – net	—		133.1		4.6			—			137.7
Intercompany receivables	85.8		0.1		0.6			(86.5		)	—
Other	—		11.4		0.5			—			11.9
Inventories	—		197.5		8.0			(3.9		)	201.6
Prepaid expenses and other current assets	0.1		18.0		0.9			(0.5		)	18.5
Total current assets	85.9		644.0		16.9			(90.9		)	655.9
Investments in and advances to subsidiaries	1,012.4		40.1		—			(1,052.5		)	—
Property, plant and equipment – net	—		499.5		31.4			—			530.9
Long-term intercompany receivables	80.2		—		4.9			(85.1		)	—
Deferred tax assets – net	—		154.9		—			4.8			159.7
Intangible assets – net	—		26.4		—			—			26.4
Goodwill	—		37.2		—			—			37.2
Other assets	—		33.4		—			—			33.4
Total	$	1,178.5	$	1,435.5	$	53.2		$	(1,223.7	)	$	1,443.5
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	2.2	$	68.9	$	4.7		$	—		$	75.8
Intercompany payable	—		86.4		0.1			(86.5		)	—
Accrued salaries, wages and related expenses	—		47.2		1.9			—			49.1
Other accrued liabilities	2.9		52.6		(0.7		)	(14.7		)	40.1
Total current liabilities	5.1		255.1		6.0			(101.2		)	165.0
Net liabilities of Salaried VEBA	—		28.6		—			—			28.6
Deferred tax liabilities	—		—		3.3			—			3.3
Long-term intercompany payable	—		85.1		—			(85.1		)	—
Long-term liabilities	—		70.5		2.7			—			73.2
Long-term debt	368.7		—		—			—			368.7
Total liabilities	373.8		439.3		12.0			(186.3		)	638.8

Total stockholders' equity	804.7		996.2		41.2			(1,037.4		)	804.7
Total	$	1,178.5	$	1,435.5	$	53.2		$	(1,223.7	)	$	1,443.5

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

(In millions of dollars)

Quarter Ended March 31, 2017



	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
Net sales	$	—		$	346.8		$	29.3		$	(20.8	)	$	355.3
Costs and expenses:
Cost of products sold:
Cost of products sold, excluding depreciation and amortization and other items	—			272.6			25.3			(20.1		)	277.8
Unrealized gain on derivative instruments	—			(15.1		)	—			—			(15.1		)
Depreciation and amortization	—			9.0			0.6			—			9.6
Selling, general, administrative, research and development:
Selling, general, administrative, research and development	0.9			20.9			2.4			(0.5		)	23.7
Net periodic postretirement benefit cost relating to Salaried VEBA	—			1.1			—			—			1.1
Gain on removal of Union VEBA net assets	—			(1.3		)	—			—			(1.3		)
Total selling, general, administrative, research and development	0.9			20.7			2.4			(0.5		)	23.5
Total costs and expenses	0.9			287.2			28.3			(20.6		)	295.8
Operating (loss) income	(0.9		)	59.6			1.0			(0.2		)	59.5
Other (expense) income:
Interest (expense) income	(5.7		)	0.1			—			—			(5.6		)
Other income, net	—			0.6			—			—			0.6
(Loss) income before income taxes	(6.6		)	60.3			1.0			(0.2		)	54.5
Income tax provision	—			(20.8		)	(0.2		)	2.5			(18.5		)
Earnings in equity of subsidiaries	42.6			0.6			—			(43.2		)	—
Net income	$	36.0		$	40.1		$	0.8		$	(40.9	)	$	36.0

Comprehensive income	$	37.3		$	41.4		$	0.8		$	(42.2	)	$	37.3

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

(In millions of dollars)

Quarter Ended March 31, 2016



	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
Net sales	$	—		$	335.7		$	26.4		$	(18.9	)	$	343.2
Costs and expenses:
Cost of products sold:
Cost of products sold, excluding depreciation and amortization and other items	—			257.1			23.1			(18.2		)	262.0
Lower of cost or market inventory write-down	—			4.9			—			—			4.9
Unrealized gain on derivative instruments	—			(4.0		)	—			—			(4.0		)
Depreciation and amortization	—			8.2			0.5			—			8.7
Selling, general, administrative, research and development:
Selling, general, administrative, research and development	0.8			23.6			2.2			(0.5		)	26.1
Net periodic postretirement benefit cost relating to Salaried VEBA	—			0.8			—			—			0.8
Gain on removal of Union VEBA net assets	—			(0.1		)	—			—			(0.1		)
Total selling, general, administrative, research and development	0.8			24.3			2.2			(0.5		)	26.8
Total costs and expenses	0.8			290.5			25.8			(18.7		)	298.4
Operating (loss) income	(0.8		)	45.2			0.6			(0.2		)	44.8
Other (expense) income:
Interest (expense) income	(4.3		)	0.6			—			—			(3.7		)
Other income, net	—			0.3			—			—			0.3
(Loss) income before income taxes	(5.1		)	46.1			0.6			(0.2		)	41.4
Income tax provision	—			(16.9		)	(0.2		)	2.0			(15.1		)
Earnings in equity of subsidiaries	31.4			0.3			—			(31.7		)	—
Net income	$	26.3		$	29.5		$	0.4		$	(29.9	)	$	26.3

Comprehensive income	$	27.2		$	30.3		$	0.5		$	(30.8	)	$	27.2

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

(In millions of dollars)

Quarter Ended March 31, 2017



	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
Cash flows from operating activities:
Net cash (used in) provided by operating activities	$	(0.3	)	$	2.6		$	1.8		$	—		$	4.1
Cash flows from investing activities:
Capital expenditures	—			(14.7		)	(0.1		)	—			(14.8		)
Purchase of available for sale securities	—			(74.7		)	—			—			(74.7		)
Proceeds from disposition of available for sale securities	—			110.9			—			—			110.9
Intercompany loans receivable	46.6			—			0.7			(47.3		)	—
Net cash provided by investing activities	46.6			21.5			0.6			(47.3		)	21.4
Cash flows from financing activities:
Repayment of capital lease	—			(0.2		)	—			—			(0.2		)
Cancellation of shares to cover employees' tax withholdings upon vesting of non-vested shares	(4.4		)	—			—			—			(4.4		)
Repurchase of common stock	(32.6		)	—			—			—			(32.6		)
Cash dividends and dividend equivalents paid	(9.3		)	—			—			—			(9.3		)
Intercompany loans payable	—			(47.3		)	—			47.3			—
Net cash used in financing activities	(46.3		)	(47.5		)	—			47.3			(46.5		)
Net (decrease) increase in cash, cash equivalents and restricted cash during the period	—			(23.4		)	2.4			—			(21.0		)
Cash, cash equivalents and restricted cash at beginning of period	—			65.1			2.6			—			67.7
Cash, cash equivalents and restricted cash at end of period	$	—		$	41.7		$	5.0		$	—		$	46.7

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

(In millions of dollars)

Quarter Ended March 31, 2016



	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
Cash flows from operating activities:
Net cash provided by operating activities¹	$	17.2		$	201.4		$	2.7		$	(200.0	)	$	21.3
Cash flows from investing activities:
Capital expenditures	—			(25.3		)	(0.6		)	—			(25.9		)
Proceeds from disposition of available for sale securities	—			20.0			—			—			20.0
Net cash used in investing activities	—			(5.3		)	(0.6		)	—			(5.9		)
Cash flows from financing activities:
Cancellation of shares to cover employees' tax withholdings upon vesting of non-vested shares	(2.7		)	—			—			—			(2.7		)
Repurchase of common stock	(6.3		)	—			—			—			(6.3		)
Cash dividends and dividend equivalents paid	(8.2		)	—			—			—			(8.2		)
Cash dividends paid to Parent	—			(200.0		)	—			200.0			—
Intercompany loan	—			0.8			(0.8		)	—			—
Net cash used in financing activities	(17.2		)	(199.2		)	(0.8		)	200.0			(17.2		)
Net (decrease) increase in cash, cash equivalents and restricted cash during the period	—			(3.1		)	1.3			—			(1.8		)
Cash, cash equivalents and restricted cash at beginning of period	—			83.0			0.7			—			83.7
Cash, cash equivalents and restricted cash at end of period	$	—		$	79.9		$	2.0		$	—		$	81.9

________________


¹	The Guarantor Subsidiaries’ Net cash provided by operating activities reflects a decrease in current Intercompany receivables from the Parent and an increase in current Intercompany payable to the Parent related to the $200.0 million dividend made by the Guarantor Subsidiaries to the Parent. The dividend to the Parent and intercompany activity is eliminated within the consolidating adjustments.