Exhibit 99.1
FOR IMMEDIATE RELEASE | Contact: | |
April 29, 2008 | Richard E. Leone | |
Manager — Investor Relations | ||
rleone@rtiintl.com | ||
330-544-7622 |
RTI ANNOUNCES FIRST QUARTER RESULTS
Pittsburgh, Pennsylvania — RTI International Metals, Inc. (NYSE: RTI) released results today for the first quarter of 2008.
• | Net sales for the first quarter were $150.6 million, an increase of $5.0 million over the same period in 2007 | ||
• | Operating income for the first quarter was $33.2 million | ||
• | Operating margin was 22% | ||
• | Net income was $22.2 million for the first quarter or $0.96 per diluted share | ||
• | Cash on hand was $92.4 million with total debt of $16.6 million |
For the quarter ended March 31, 2008, the Company reported net sales of $150.6 million compared to $145.6 million in the first quarter of 2007. This increase from the same quarter in the prior year was primarily the result of continued strong demand from the aerospace market for our titanium mill products. First quarter net income was $22.2 million or $0.96 per diluted share in comparison to $22.1 million or $0.95 per diluted share for the same period in the prior year.
Titanium Group
RTI’s Titanium Group reported operating income of $28.4 million on sales of $102.2 million, including intersegment sales of $47.1 million. This operating performance surpasses the first quarter of 2007 which had operating income of $21.3 million on sales of $103.2 million, including intersegment sales of $50.0 million. Mill product shipments for the first quarter were 3.9 million pounds at an average realized price of $24.94 per pound. RTI’s average realized price was down 2.7% versus the same quarter in the prior year due to the impact of a larger percentage of volumes subject to pricing under long-term contracts.
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Fabrication & Distribution Group
Net sales for the Fabrication & Distribution Group (“F&D”) increased for the first quarter to $95.5 million versus $92.4 million in the same period a year ago. The F&D Group had operating income of $4.9 million, compared to $11.6 million in the first quarter of 2007. Ongoing startup costs, low utilization and softening in prices of certain specialty metals products through our distribution channel adversely impacted this Group’s margins.
CEO Comment
Dawne S. Hickton, Vice Chairman & CEO commented, “The Titanium Group posted strong operating results, with the highest first quarter operating income in its history, aided primarily by the ramp up of our 2006 Airbus long-term agreement and continued strong demand from the aerospace market. However, we anticipate that near term challenges associated with the Boeing 787 delay will begin to impact this Group as we now expect total 2008 mill product shipments to range between 15.5 million and 16.5 million pounds.”
“The F&D Group’s performance continues to be driven by the 787 production delays which are now having a direct impact on the demand for our finished parts, especially seat tracks fabricated at our Houston and Montreal facilities. The most recent announced delay is causing us to reevaluate our current production plans and managed expenses throughout the entire F&D system. Based on conversations with our customers on the 787 program, we are planning that the impact for the balance of 2008 will be significant, particularly in the second half of 2008 and throughout all of 2009. Even though our fabrication work with Boeing and its supply chain will be pushed out beyond one year, we expect that the anticipated revenue will ultimately be realized.”
“The long-term outlook for our business continues to be very strong,” added Dawne Hickton. “Airbus and Boeing reported orders in the first quarter that once again exceeded deliveries, expanding their huge backlogs. In support of our almost $4.0 billion of long-term mill product contracts with Airbus and Lockheed Martin, our capital expansion projects are on schedule. With cash of $92.4 million, debt of $16.6 million and an undrawn credit facility of $240 million, we are prepared to manage through these near term challenges profitably and opportunistically.”
Outlook
As a result of current market conditions associated with the revised 787 production schedule, the Company expects sales for this year to approximate sales for 2007 and operating income, compared to 2007, to decline within a range of five to ten percent.
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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 program build-rates, military spending and continued support for the Joint Strike Fighter program, 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 expansion of the scope of U.S. Custom’s current investigation of the Company’s duty drawback claims beyond those claims currently identified as being under investigation, the potential imposition of fines and penalties by U.S. Customs, the successful completion of our 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.
RTI International Metals®, headquartered in Pittsburgh, Pennsylvania, is a leading U.S. producer of titanium mill products and fabricated metal components for the global market. Through its various subsidiaries, RTI manufactures and distributes titanium and specialty metal mill products, extruded shapes, formed parts and engineered systems for aerospace, industrial, defense, energy, chemical and consumer applications for customers around the world. To learn more about RTI International Metals, Inc., visit our website at www.rtiintl.com.
NOTE: RTI International Metals, Inc. has scheduled a conference call for Tuesday, April 29, 2008 at 11:00 a.m., Eastern Time, to discuss this press release. To participate in the call, please dial toll free (USA/Canada) 877-493-9121 or (International) 973-582-2750 a few minutes prior to the start time and specify the RTI International Metals Conference Call. Replay of the call will be available until 11:59 p.m., Eastern Time, on Tuesday, May 6, 2008, by dialing (USA/Canada) 800-642-1687 or (International) 706-645-9291 and Digital Pin Code 44702380.
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RTI INTERNATIONAL METALS, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
(Unaudited)
(In thousands, except share and per share amounts)
Condensed Consolidated Statements of Operations
(Unaudited)
(In thousands, except share and per share amounts)
Three Months Ended | ||||||||
March 31, | ||||||||
2008 | 2007 | |||||||
Net sales | $ | 150,648 | $ | 145,557 | ||||
Cost and expenses: | ||||||||
Cost of sales | 98,590 | 94,012 | ||||||
Selling, general, and administrative expenses | 18,308 | 18,198 | ||||||
Research, technical, and product development expenses | 524 | 461 | ||||||
Operating income | 33,226 | 32,886 | ||||||
Other income (expense) | 295 | (541 | ) | |||||
Interest income | 903 | 1,136 | ||||||
Interest expense | (350 | ) | (300 | ) | ||||
Income before income taxes | 34,074 | 33,181 | ||||||
Provision for income taxes | 11,837 | 11,108 | ||||||
Net income | $ | 22,237 | $ | 22,073 | ||||
Earnings per share: | ||||||||
Basic | $ | 0.97 | $ | 0.97 | ||||
Diluted | $ | 0.96 | $ | 0.95 | ||||
Weighted-average shares outstanding: | ||||||||
Basic | 22,946,511 | 22,869,493 | ||||||
Diluted | 23,186,958 | 23,153,573 | ||||||
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RTI INTERNATIONAL METALS, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(Unaudited)
(In thousands, except share and per share amounts)
Condensed Consolidated Balance Sheets
(Unaudited)
(In thousands, except share and per share amounts)
March 31, | December 31, | |||||||
2008 | 2007 | |||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 92,439 | $ | 107,505 | ||||
Receivables, less allowance for doubtful accounts of $591 and $613 | 103,156 | 102,073 | ||||||
Inventories, net | 320,122 | 296,559 | ||||||
Deferred income taxes | 13,191 | 12,969 | ||||||
Other current assets | 4,206 | 2,951 | ||||||
Total current assets | 533,114 | 522,057 | ||||||
Property, plant, and equipment, net | 172,209 | 157,355 | ||||||
Goodwill | 50,202 | 50,769 | ||||||
Other intangible assets, net | 16,524 | 17,476 | ||||||
Deferred income taxes | 9,230 | 6,059 | ||||||
Other noncurrent assets | 1,455 | 1,568 | ||||||
Total assets | $ | 782,734 | $ | 755,284 | ||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 46,156 | $ | 46,666 | ||||
Accrued wages and other employee costs | 20,519 | 22,028 | ||||||
Billings in excess of costs and estimated earnings | 32,377 | 21,573 | ||||||
Income taxes payable | 11,398 | — | ||||||
Current portion of long-term debt | 1,074 | 1,090 | ||||||
Current liability for post-retirement benefits | 2,660 | 2,660 | ||||||
Current liability for pension benefits | 1,843 | 5,962 | ||||||
Other accrued liabilities | 14,798 | 16,171 | ||||||
Total current liabilities | 130,825 | 116,150 | ||||||
Long-term debt | 15,549 | 16,506 | ||||||
Noncurrent liability for post-retirement benefits | 31,449 | 31,019 | ||||||
Noncurrent liability for pension benefits | 8,563 | 8,526 | ||||||
Deferred income taxes | 69 | 69 | ||||||
Other noncurrent liabilities | 7,598 | 7,230 | ||||||
Total liabilities | 194,053 | 179,500 | ||||||
Shareholders’ equity: | ||||||||
Common stock, $0.01 par value; 50,000,000 shares authorized; 23,665,330 and 23,610,746 shares issued; 22,981,555 and 23,105,708 shares outstanding | 237 | 236 | ||||||
Additional paid-in capital | 303,954 | 302,075 | ||||||
Treasury stock, at cost; 683,775 and 505,038 shares | (16,888 | ) | (7,801 | ) | ||||
Accumulated other comprehensive loss | (22,500 | ) | (20,367 | ) | ||||
Retained earnings | 323,878 | 301,641 | ||||||
Total shareholders’ equity | 588,681 | 575,784 | ||||||
Total liabilities and shareholders’ equity | $ | 782,734 | $ | 755,284 | ||||
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RTI INTERNATIONAL METALS, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(In thousands)
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(In thousands)
Three Months Ended | ||||||||
March 31, | ||||||||
2008 | 2007 | |||||||
Cash provided by operating activities (including depreciation and amortization of $4,730 and $3,605 for the three months ended March 31, 2008 and 2007, respectively) | $ | 15,270 | $ | 15,617 | ||||
Cash used in investing activities | (20,975 | ) | (15,180 | ) | ||||
Cash provided by (used in) financing activities | (8,995 | ) | 3,956 | |||||
Effect of exchange rate changes on cash and cash equivalents | (366 | ) | (138 | ) | ||||
Increase (decrease) in cash and cash equivalents | (15,066 | ) | 4,255 | |||||
Cash and cash equivalents at beginning of period | 107,505 | 40,026 | ||||||
Cash and cash equivalents at end of period | $ | 92,439 | $ | 44,281 | ||||
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RTI INTERNATIONAL METALS, INC. AND SUBSIDIARIES
Selected Operating Segment Information
(Unaudited)
(In thousands)
Selected Operating Segment Information
(Unaudited)
(In thousands)
Three Months Ended | ||||||||
March 31, | ||||||||
2008 | 2007 | |||||||
Net sales: | ||||||||
Titanium Group | $ | 55,127 | $ | 53,168 | ||||
Intersegment sales | 47,089 | 49,999 | ||||||
Total Titanium Group net sales | 102,216 | 103,167 | ||||||
Fabrication & Distribution Group | 95,521 | 92,389 | ||||||
Intersegment sales | 1,905 | 2,212 | ||||||
Total Fabrication & Distribution Group net sales | 97,426 | 94,601 | ||||||
Eliminations | 48,994 | 52,211 | ||||||
Total consolidated net sales | $ | 150,648 | $ | 145,557 | ||||
Operating income: | ||||||||
Titanium Group before corporate allocations | $ | 31,357 | $ | 22,958 | ||||
Corporate allocations | (3,005 | ) | (1,657 | ) | ||||
Total Titanium Group operating income | 28,352 | 21,301 | ||||||
Fabrication & Distribution Group before corporate allocations | 9,321 | 15,308 | ||||||
Corporate allocations | (4,447 | ) | (3,723 | ) | ||||
Total Fabrication & Distribution Group operating income | 4,874 | 11,585 | ||||||
Total consolidated operating income | $ | 33,226 | $ | 32,886 | ||||
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