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RTI Reports Third Quarter Results

Dépèche transmise le 1 novembre 2011 par Business Wire

PITTSBURGH--(BUSINESS WIRE)--RTI International Metals, Inc., (NYSE: RTI), released results today for the third quarter of 2011.

Third Quarter 2011 Results

  • Net sales for the third quarter were $143.7 million
  • Third quarter operating income was $7.7 million
  • Net income for the third quarter was $2.1 million
  • Titanium mill product shipments for the third quarter totaled 4.3 million pounds at an average realized price of $18.99 per pound

For the third quarter of 2011, RTI reported net income of $2.1 million, or $0.07 per diluted share, on net sales of $143.7 million. Operating income for the period was $7.7 million. For the third quarter of 2010, RTI reported a net loss of $16.8 million, or $0.56 per diluted share, on net sales of $102.6 million. The net loss for the third quarter of 2010 included a $13.9 million provision for income taxes. The operating loss for the third quarter of 2010 was $2.2 million.

For the nine months ended September 30, 2011, RTI reported net income of $6.5 million, or $0.22 per diluted share, on net sales of $387.7 million, compared to net income of $4.9 million, or $0.16 per diluted share, on net sales of $317.1 million for the same period a year ago. Operating income for the first nine months of 2011 was $23.2 million. Operating income for the comparable period in 2010 was $11.5 million including a $15.4 million customer payment with no associated cost. Without such customer payment, the operating loss for the first nine months of 2010 would have been $3.9 million.

Titanium Group

For the third quarter of 2011, the Titanium Group posted operating income of $4.9 million on sales of $87.7 million, including intersegment sales of $42.7 million. During the same period in 2010, this Group reported operating income of $1.3 million on sales of $52.3 million, including intersegment sales of $20.0 million. The improved results for the three-month period in 2011 versus the same period in 2010 were driven by increased commercial aircraft build rates resulting in the largest quarterly volume of shipped mill products by the Company in over ten years. Average selling prices for the quarter were also higher than in the comparable period in 2010.

During the first nine months of 2011, the Titanium Group posted operating income of $22.9 million on sales of $231.7 million, including intersegment sales of $114.7 million. During the first nine months of 2010, the Titanium Group posted operating income of $18.1 million on sales of $168.7 million, including intersegment sales of $67.1 million, which included the $15.4 million customer payment with no associated cost.

Mill product shipments for the third quarter were 4.3 million pounds at an average realized price of $18.99 per pound, compared to mill product shipments of 2.7 million pounds in the third quarter of 2010 at an average realized price of $18.05 per pound.

Mill product shipments for the first nine months of 2011 were 10.7 million pounds at an average realized price of $19.69 per pound compared to mill product shipments of 7.4 million pounds in 2010 at an average realized price of $18.88 per pound.

Fabrication Group

During the third quarter of 2011, the Fabrication Group posted an operating loss of $1.5 million on net sales of $40.2 million. For the same period in 2010, this Group had an operating loss of $3.0 million on net sales of $34.1 million. The lower operating losses for the three-month period in 2011 versus 2010 were driven in part by increased shipments for the Boeing 787 Dreamliner, improvement in the internal supply chain for the fabrication of these parts, as well as a customer payment for engineering design changes.

For the first nine months of 2011, the Fabrication Group reported net sales of $110.5 million and an operating loss of $8.0 million compared with net sales of $100.0 million and an operating loss of $9.1 million for the same period in the prior year.

Distribution Group

For the third quarter of 2011, the Distribution Group posted an operating profit of $4.3 million on net sales of $58.4 million. During the same period in 2010, the Distribution Group posted an operating loss of $0.5 million on net sales of $36.2 million. The operating profit during the period reflected higher demand for both our titanium and specialty alloys products due to increased commercial aircraft production, as well as increased demand from our various rotorcraft customers and higher build rates on the Joint Strike Fighter.

For the nine months ended September 30, 2011, the Distribution Group reported net sales of $160.3 million resulting in operating income of $8.4 million, compared with net sales of $115.5 million and operating income of $2.5 million for the same period in the prior year.

CEO Comment

Dawne S. Hickton, Vice Chair, President, and CEO stated, “Overall end-market demand for titanium continues to accelerate, notwithstanding headwinds in the defense sector. We now expect total mill product shipments for the year to exceed 14.0 million pounds. Commercial aircraft production increases announced by both Airbus and Boeing are driving this accelerated demand. And given our customers’ concerns regarding the ability for the overall supply chain to keep up with their increasing build rates, customers are placing orders for titanium mill products approximately 12 to 18 months before expected aircraft deliveries.

“Finally, the acquisition of the Forming Division of Aeromet PLC, which will be called ‘RTI Advanced Forming,’ is expected to close by December 1, 2011. I’m very excited about the additional capabilities that RTI Advanced Forming will add to our product offering, particularly since it will provide several fabrication-related enhancements for the direct benefit of our end-market aerospace and defense customers.”

Conference Call Information

To participate in today’s 10:00 a.m. Eastern Time conference call, please dial toll free (USA/Canada) 888-895-5479 or (International) 847-619-6250 a few minutes prior to the start time and specify the RTI International Metals’ Conference Call.

Replay Information

Replay of the call will be accessible one hour after the conference ends and remain available until Tuesday, November 15, 2011 at 11:59 p.m., Eastern Time. To access the conference call replay, dial (USA/Canada) 888-843-7419 or (International) 630-652-3042 and enter Pass Code 3099 3210 #.

Forward Looking Statement

The statements in this release relating to matters that are not historical facts are forward-looking statements that may involve risks and uncertainties. These include, but are not limited to, the impact of global events on the commercial aerospace industry, actual build-rates, production schedules and titanium content per aircraft for commercial and military aerospace programs, military spending generally and in particular, demand from the Joint Strike Fighter program, the impact from Boeing 787 production delays, global economic conditions, the competitive nature of the markets for specialty metals, the ability of the Company to obtain an adequate supply of raw materials, the successful completion of the Company’s capital expansion projects, and other risks and uncertainties included in the Company’s filings with the Securities and Exchange Commission. Actual results can differ materially from those forecasted or expected. The information contained in this release is qualified by and should be read in conjunction with the statements and notes filed with the Securities and Exchange Commission on Forms 10-K and 10-Q, as may be amended from time to time.

Company Description

RTI International Metals, Inc., headquartered in Pittsburgh, Pennsylvania, specializes in advanced titanium, meeting the requirements of the world's most technologically sophisticated applications in commercial aerospace, defense, propulsion, energy, industrial, chemical, and medical markets. For 60 years, RTI has been taking titanium further through advanced manufacturing, engineering, machining, and forming processes. The Company delivers titanium mill products, extruded shapes, form-ready parts, and highly engineered components through our downstream-integrated supply chain. RTI has locations in the United States, Canada, Europe, and Asia. To learn more about RTI International Metals, Inc., visit our website at www.rtiintl.com.

 

RTI INTERNATIONAL METALS, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
(Unaudited)
(In thousands, except share and per share amounts)

               

Three Months Ended

Nine Months Ended

September 30,

September 30

2011 2010 2011   2010
 
Net sales $ 143,671 $ 102,593 $ 387,734 $ 317,129
Cost and expenses:
Cost of sales 118,665 88,418 312,134 258,482
Selling, general, and administrative expenses 16,388 15,771 51,464 47,828

Research, technical, and product development expenses

925 783 2,447 2,536
Asset and asset-related charges (income)   -     (151 )   (1,501 )   (3,262 )
Operating income (loss) 7,693 (2,228 ) 23,190 11,545
Other income (expense) 198 (519 ) (238 ) (153 )
Interest income 331 127 911 358
Interest expense   (4,173 )   (264 )   (12,723 )   (828 )
 
Income (loss) before income taxes 4,049 (2,884 ) 11,140 10,922
Provision for income taxes   1,982     13,891     4,603     6,060  
Net Income (loss) $ 2,067   $ (16,775 ) $ 6,537   $ 4,862  
 
Earnings (loss) per share:
Basic $ 0.07   $ (0.56 ) $ 0.22   $ 0.16  
Diluted $ 0.07   $ (0.56 ) $ 0.22   $ 0.16  
 
Weighted-average shares outstanding:
Basic   30,025,607     29,933,615     30,013,464     29,901,657  
Diluted   30,251,411     29,933,615     30,278,456     30,143,031  
 
 

RTI INTERNATIONAL METALS, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(Unaudited)
(In thousands, except share and per share amounts)

      September 30,   December 31,

ASSETS

2011 2010
Current assets:
Cash and cash equivalents $ 189,741 $ 376,951
Short-term investments 76,587 20,275
Receivables, less allowance for doubtful accounts of $778 and $478 87,883 56,235
Inventories, net 257,049 269,719
Deferred income taxes 19,974 22,891
Other current assets   14,663     16,299  
Total current assets 645,897 762,370
Property, plant, and equipment, net 268,056 260,576
Marketable securties 89,479 -

Goodwill

41,305 41,795
Other intangible assets, net 12,829 14,066
Deferred income taxes 23,611 21,699
Other noncurrent assets   5,228     6,348  
Total assets $ 1,086,405   $ 1,106,854  
 

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
Accounts payable $ 53,960 $ 47,226
Accrued wages and other employee costs 20,978 21,951
Unearned revenues 18,234 28,358
Other accrued liabilities   19,831     28,179  
Total current liabilities 113,003 125,714
Long-term debt 184,695 178,107
Noncurrent liability for post-retirement benefits 41,128 39,903
Noncurrent liability for pension benefits 7,153 33,830
Deferred income taxes 5,441 3,147
Other noncurrent liabilities   8,538     7,753  
Total liabilities   359,958     388,454  
Commitments and Contingencies
Shareholders’ equity:
Common stock, $0.01 par value; 50,000,000 shares authorized;
30,935,132 and 30,858,725 shares issued; 30,187,961 and
30,123,519 shares oustanding 309 309
Additional paid-in capital 478,025 474,277
Treasury stock, at cost; 747,171 and 735,206 shares (17,646 ) (17,363 )
Accumulated other comprehensive loss (34,292 ) (32,337 )
Retained earnings   300,051     293,514  
Total shareholders’ equity   726,447     718,400  
Total liabilities and shareholders’ equity $ 1,086,405   $ 1,106,854  
 
             

RTI INTERNATIONAL METALS, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(In thousands)

 
Nine Months Ended
September 30,
2011 2010

Cash provided by (used in) operating activities (including depreciation and

amortization of $16,697 and $16,600 for the nine months ended
September 30, 2011 and 2010, respectively) $ (13,507 ) $ 31,611
 
Cash provided by (used in) investing activities (1) (173,346 ) 23,359
 
Cash provided by financing activities   207     955
 
Effect of exchange rate changes on cash and cash equivalents   (564 )   1,493
 
Increase (decrease) in cash and cash equivalents (187,210 ) 57,418
Cash and cash equivalents at beginning of period   376,951     56,216
Cash and cash equivalents at end of period $ 189,741   $ 113,634
 
(1)   In the current year, cash used in investing activities included net purchases of short-term investments and marketable securities of $147,392 compared to net sales of short-term investments of $44,785 in the prior year.
 
       

RTI INTERNATIONAL METALS, INC. AND SUBSIDIARIES
Selected Operating Segment Information
(Unaudited)
(In thousands)

 
Three Months Ended Nine Months Ended
September 30, September 30,
2011   2010 2011   2010
Net sales:
Titanium Group $ 45,028 $ 32,263 $ 116,983 $ 101,660
Intersegment sales   42,709     20,006     114,677     67,062  
Total Titanium Group sales 87,737 52,269 231,660 168,722
 
Fabrication Group 40,220 34,116 110,474 100,013
Intersegment sales   13,916     12,753     42,470     40,184  
Total Fabrication Group sales 54,136 46,869 152,944 140,197
 
Distribution Group 58,423 36,214 160,277 115,456
Intersegment sales   255     835     1,056     2,116  
Total Distribution Group sales 58,678 37,049 161,333 117,572
 
Eliminations   56,880     33,594     158,203     109,362  
Total consolidated net sales $ 143,671   $ 102,593   $ 387,734   $ 317,129  
 
Operating income (loss):
Titanium Group before corporate allocations $ 7,366 $ 3,633 $ 30,475 $ 24,570
Corporate allocations   (2,428 )   (2,328 )   (7,616 )   (6,441 )
Total Titanium Group operating income 4,938 1,305 22,859 18,129
 
Fabrication Group before corporate allocations 1,647 187 1,841 (291 )
Corporate allocations   (3,146 )   (3,205 )   (9,870 )   (8,784 )
Total Fabrication Group operating loss (1,499 ) (3,018 ) (8,029 ) (9,075 )
 
Distribution Group befor

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