Haynes International (HAYN) 10-Q 4 Aug 16 2016 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Jun. 30, 2016	Aug. 04, 2016
Document and Entity Information
Entity Registrant Name	HAYNES INTERNATIONAL INC
Entity Central Index Key	858,655
Document Type	10-Q
Document Period End Date	Jun. 30, 2016
Amendment Flag	false
Current Fiscal Year End Date	--09-30
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		12,491,149
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	Q3

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2016	Sep. 30, 2015
Current assets:
Cash and cash equivalents	$ 44,418	$ 49,045
Restricted cash (Note 16)	9,200
Accounts receivable, less allowance for doubtful accounts of $869 and $771 respectively	67,261	75,593
Inventories	245,626	247,836
Income taxes receivable	7,949	3,699
Deferred income taxes		6,295
Other current assets	3,052	2,974
Total current assets	377,506	385,442
Property, plant and equipment, net	192,129	185,351
Deferred income taxes-long term portion	53,906	53,958
Prepayments and deferred charges	1,933	1,877
Goodwill	4,789	4,789
Other intangible assets, net	6,399	6,774
Total assets	636,662	638,191
Current liabilities:
Accounts payable	30,884	29,386
Accrued expenses	12,303	16,576
Accrued pension and postretirement benefits	4,965	4,965
Deferred revenue-current portion	13,751	2,500
Total current liabilities	61,903	53,427
Long-term obligations (less current portion)	4,575	4,574
Deferred revenue (less current portion)	23,454	25,329
Deferred income taxes	1,707
Accrued pension benefits	103,381	107,208
Accrued postretirement benefits	104,714	105,664
Total liabilities	299,734	296,202
Commitments and contingencies (Note 6)
Stockholders' equity:
Common stock, $0.001 par value (40,000,000 shares authorized, 12,467,498 and 12,520,508 shares issued and 12,446,000 and 12,491,149 outstanding at September 30, 2015 and June 30, 2016, respectively)	12	12
Preferred stock, $0.001 par value (20,000,000 shares authorized, 0 shares issued and outstanding)
Additional paid-in capital	246,081	244,488
Accumulated earnings	180,151	186,533
Treasury stock, 21,498 shares at September 30, 2015 and 29,159 shares at June 30, 2016	(1,380)	(1,091)
Accumulated other comprehensive loss	(87,936)	(87,953)
Total stockholders' equity	336,928	341,989
Total liabilities and stockholders' equity	$ 636,662	$ 638,191

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2016	Sep. 30, 2015
CONSOLIDATED BALANCE SHEETS
Accounts receivable, allowance for doubtful accounts (in dollars)	$ 757	$ 869
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	40,000,000	40,000,000
Common stock, shares issued (in shares)	12,520,608	12,467,498
Common stock, shares outstanding (in shares)	12,491,149	12,446,000
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized (in shares)	20,000,000	20,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Treasury stock, shares (in shares)	29,159	21,498

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
CONSOLIDATED STATEMENTS OF OPERATIONS
Net revenues	$ 101,255	$ 121,270	$ 298,836	$ 370,634
Cost of sales	87,990	97,119	264,578	298,375
Gross profit	13,265	24,151	34,258	72,259
Selling, general and administrative expense	9,211	12,412	29,011	31,767
Research and technical expense	916	878	2,744	2,691
Operating income	3,138	10,861	2,503	37,801
Interest income	(29)	(21)	(74)	(64)
Interest expense	138	36	415	68
Income before income taxes	3,029	10,846	2,162	37,797
Provision for income taxes	237	4,244	304	13,095
Net income	$ 2,792	$ 6,602	$ 1,858	$ 24,702
Net income per share:
Basic (in dollars per share)	$ 0.22	$ 0.53	$ 0.15	$ 1.99
Diluted (in dollars per share)	0.22	0.53	0.15	1.98
Dividend declared per common share (in dollars per share)	$ 0.22	$ 0.22	$ 0.66	$ 0.66

CONSOLIDATED STATEMENTS OF COMP

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
Net income	$ 2,792	$ 6,602	$ 1,858	$ 24,702
Other comprehensive income (loss), net of tax:
Pension and postretirement	1,976	1,255	5,928	3,762
Foreign currency translation adjustment	(3,745)	3,381	(5,911)	(1,864)
Other comprehensive income (loss)	(1,769)	4,636	17	1,898
Comprehensive income (loss)	$ 1,023	$ 11,238	$ 1,875	$ 26,600

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Cash flows from operating activities:
Net income	$ 1,858	$ 24,702
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation	15,316	13,898
Amortization	375	385
Pension and post-retirement expense - U.S. and U.K.	14,394	9,591
Change in long-term obligations	38	(778)
Stock compensation expense	1,432	1,609
Excess tax expense from restricted stock vesting	149	52
Deferred revenue	9,376	(1,875)
Deferred income taxes	4,007	624
Loss on disposition of property	213	180
Change in assets and liabilities:
Restricted cash	(9,200)
Accounts receivable	5,830	(2,341)
Inventories	(2,133)	(7,742)
Other assets	(144)	389
Accounts payable and accrued expenses	(1,718)	4,028
Income taxes	(3,653)	269
Accrued pension and postretirement benefits	(9,794)	(4,112)
Net cash provided by operating activities	26,346	38,879
Cash flows from investing activities:
Additions to property, plant and equipment	(22,102)	(14,049)
Acquisition of Leveltek – LaPorte assets		(14,600)
Net cash provided by investing activities	(22,102)	(28,649)
Cash flows from financing activities:
Dividends paid	(8,240)	(8,214)
Proceeds from exercise of stock options	310
Payment for purchase of treasury stock	(289)	(251)
Excess tax expense from restricted stock vesting	(149)	(52)
Payment on long-term obligations	(37)
Net cash used in financing activities	(8,405)	(8,517)
Effect of exchange rates on cash	(466)	(349)
Decrease in cash and cash equivalents	(4,627)	1,364
Cash and cash equivalents:
Cash and cash equivalents, beginning of period	49,045	45,871
Cash and cash equivalents, end of period	44,418	47,235
Cash paid during period for:
Interest (net of capitalized interest)	366	19
Income taxes paid, (net of refunds)	(48)	12,189
Capital expenditures incurred but not yet paid	$ 2,521	1,269
Capital lease obligation incurred		$ 4,500

Basis of Presentation

Basis of Presentation	9 Months Ended
	Jun. 30, 2016
Basis of Presentation
Basis of Presentation	Note 1. Basis of Presentation Interim Financial Statements The accompanying unaudited condensed interim consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States of America, and such principles are applied on a basis consistent with information reflected in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2015 filed with the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to the rules and regulations promulgated by the SEC related to interim financial statements. In the opinion of management, the interim financial information includes all adjustments and accruals, consisting only of normal recurring adjustments, which are necessary for a fair presentation of results for the respective interim periods. The results of operations for the three and nine months ended June 30, 2016 are not necessarily indicative of the results to be expected for the full fiscal year ending September 30, 2016 or any interim period. Principles of Consolidation The consolidated financial statements include the accounts of Haynes International, Inc. and its directly and indirectly wholly-owned subsidiaries (collectively, the “Company”). All intercompany transactions and balances are eliminated.

New Accounting Pronouncements

New Accounting Pronouncements	9 Months Ended
	Jun. 30, 2016
New Accounting Pronouncements
New Accounting Pronouncements	Note 2. New Accounting Pronouncements In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) . The objective of the update is to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. It is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. The Company is currently evaluating the methods of adoption allowed by the new standard and the effect, if any, on its consolidated financial statements. In July 2015, the FASB issued ASU 2015-11, Inventory (Topic 330) . The objective of this update was to simplify the measurement of inventory valuation at the lower of cost or net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. It is effective for annual reporting periods beginning after December 15, 2016 and interim periods within fiscal years beginning after December 15, 2017. The adoption of these changes is not expected to have a material impact to the Company’s consolidated financial statements. In April 2015, the FASB issued ASU 2015-15, Interest – Imputation of interest (Subtopic 835-30) : Simplifying the Presentation of Debt Issuance Costs, which requires entities to present debt issuance costs related to a recognized debt liability as a direct deduction from the carrying amount of that debt liability. In August 2015, the FASB clarified ASU 2015-15 to address presentation and subsequent measurement of debt issuance costs related to line-of-credit arrangements. This amendment allows for the reporting entity to defer and present debt issuance costs as an asset and subsequently amortize the debt issuance costs over the term of the line-of-credit agreement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement, including interim periods within that reporting period. It is effective for fiscal 2017, including interim periods, and is not expected to result in a material impact to the Company’s consolidated financial statements or the related disclosures. In February, 2016, the FASB issued ASU 2016-02, Leases (Topic 842) . This new guidance will require that a lessee recognize assets and liabilities on the balance sheet for all leases with a lease term of more than twelve months, with the result being the recognition of a right of use asset and a lease liability. The new lease accounting requirements are effective for fiscal years beginning after December 18, 2018, including interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact of the new guidance on its consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, Compensation – Stock Compensation (Topic 718) : Improvements to Employee Share-Based Payment Accounting. The objective of this update was to simplify the accounting for share-based payment transactions, including the income tax consequences of awards as either equity or liabilities, and classification on the statement of cash flows. The new share-based compensation accounting requirements are effective for fiscal years beginning after December 15, 2016, and interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact of the new guidance on its consolidated financial statements.

Inventories

Inventories	9 Months Ended
	Jun. 30, 2016
Inventories
Inventories	Note 3. Inventories The following is a summary of the major classes of inventories: September 30, June 30, 2015 2016 Raw Materials $ $ Work-in-process Finished Goods Other $ $

Income Taxes

Income Taxes	9 Months Ended
	Jun. 30, 2016
Income Taxes
Income Taxes	Note 4. Income Taxes Income tax expense for the three and nine months ended June 30, 2015 and 2016 differed from the U.S. federal statutory rate of 35% primarily due to state income taxes, differing tax rates on foreign earnings and discrete tax items that impacted income tax expense in these periods. The effective tax rate for the three months ended June 30, 2016 was 7.8% compared to 39.1% in the same period of fiscal 2015. The effective tax rate for the nine months ended June 30, 2016 was 14.0% compared to 34.6% in the same period of fiscal 2015. The lower effective tax rate for the third quarter and the first nine months of fiscal 2016 is primarily attributable to a research and development tax credit that was recognized in the third quarter of fiscal 2016, which decreased tax expense by approximately $800 . In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740) : Balance Sheet Classification of Deferred Taxes. The objective of this update was to simplify the presentation of deferred income taxes by requiring that deferred tax liabilities and assets be classified as noncurrent on the Consolidated Balance Sheet. The Company chose to adopt this standard change prospectively beginning in the first quarter of fiscal 2016.

Pension and Post-retirement Ben

Pension and Post-retirement Benefits	9 Months Ended
	Jun. 30, 2016
Pension and Post-retirement Benefits
Pension and Post-retirement Benefits	Note 5. Pension and Post-retirement Benefits Components of net periodic pension and post-retirement benefit cost for the three and nine months ended June 30, 2015 and 2016 were as follows: Three Months Ended June 30, Nine Months Ended June 30, Pension Benefits Other Benefits Pension Benefits Other Benefits 2015 2016 2015 2016 2015 2016 2015 2016 Service cost $ $ $ $ $ $ $ $ Interest cost Expected return — — — — Amortizations Net periodic benefit cost $ $ $ $ $ $ $ $ The Company contributed $4,500 to Company-sponsored domestic pension plans, $4,569 to its other post-retirement benefit plans and $ 651 to the U.K. pension plan for the nine months ended June 30, 2016. The Company presently expects future contributions of $1,500 to its U.S. pension plan, $1,250 to its other post-retirement benefit plan, and $200 to the U.K. pension plan for the remainder of fiscal 2016.

Legal, Environmental and Other

Legal, Environmental and Other Contingencies	9 Months Ended
	Jun. 30, 2016
Legal, Environmental and Other Contingencies
Legal, Environmental and Other Contingencies	Note 6. Legal, Environmental, and Other Contingencies The Company is regularly involved in litigation, both as a plaintiff and as a defendant, relating to its business and operations, including environmental, commercial, employment and federal and/or state Equal Employment Opportunity Commission administrative actions. Future expenditures for environmental, employment, intellectual property and other legal matters cannot be determined with any degree of certainty; however, based on the facts presently known, management does not believe that such costs will have a material effect on the Company’s financial position, results of operations or cash flows. The Company is currently, and has in the past been, subject to claims involving personal injuries allegedly relating to its products and processes. For example, the Company is presently involved in two actions involving welding rod-related injuries, which were filed in California state court against numerous manufacturers, including the Company, in May 2006 and February 2007, respectively, alleging that the welding-related products of the defendant manufacturers harmed the users of such products through the inhalation of welding fumes containing manganese. The Company is also involved in three actions related to asbestos in its facilities, which were filed in 2012 and 2014. The Company believes that it has defenses to these lawsuits and that, if the Company were to be found liable, the cases would not have a material effect on its financial position, results of operations or liquidity. The Company has received permits from the Indiana Department of Environmental Management, or IDEM, to close and to provide post-closure monitoring and care for certain areas at the Kokomo facility previously used for the storage and disposal of wastes, some of which are classified as hazardous under applicable regulations. Closure certification was received in fiscal 1988 for the South Landfill at the Kokomo facility, and post-closure monitoring and care is ongoing there. Closure certification was received in fiscal 1999 for the North Landfill at the Kokomo facility, and post-closure monitoring and care are permitted and ongoing there. The Company also has a single post-closure permit applicable to both the North and South Landfills, which contains monitoring and post-closure care requirements. In addition, IDEM required that a Resource Conservation and Recovery Act, or RCRA, Facility Investigation, or RFI be conducted in order to further evaluate one additional area of concern and one additional solid waste management unit. The RFI commenced in fiscal 2008 and is ongoing. Based on preliminary results, the Company has determined that additional testing and further source remediation are necessary. The Company has also received permits from the North Carolina Department of Environment and Natural Resources, or NCDENR, to close and provide post-closure monitoring and care for the hazardous waste lagoon at its Mountain Home, North Carolina facility. The lagoon area has been closed and is currently undergoing post-closure monitoring and care. The Company is required to monitor groundwater and to continue post-closure maintenance of the former disposal areas at each site. As a result, the Company is aware of elevated levels of certain contaminants in the groundwater, and additional corrective action by the Company could be required. On August 3, 2012, the Company received an information request from the United States Environmental Protection Agency, or EPA, relating to the Company’s compliance with laws relating to air quality. The Company responded to the request, and there has been no further action by the EPA. As of September 30, 2015 and June 30, 2016, the Company has accrued $749 for post-closure monitoring and maintenance activities, of which $662 is included in long-term obligations as it is not due within one year. Accruals for these costs are calculated by estimating the cost to monitor and maintain each post-closure site and multiplying that amount by the number of years remaining in the post-closure monitoring. Expected expenditures for post-closure monitoring and maintenance activities (discounted) included in long-term obligations were as follows at June 30, 2016. 2016 $ — 2017 2018 2019 2020 2021 and thereafter $

Deferred Revenue

Deferred Revenue	9 Months Ended
	Jun. 30, 2016
Deferred Revenue
Deferred Revenue	Note 7. Deferred Revenue On November 17, 2006, the Company entered into a twenty -year agreement to provide conversion services to Titanium Metals Corporation (“TIMET”) for up to ten million pounds of titanium metal annually. TIMET paid the Company a $50,000 up-front fee and will also pay the Company for its processing services during the term of the agreement at prices established by the terms of the agreement. TIMET may exercise an option to have ten million additional pounds of titanium converted annually, provided that it offers to loan up to $12,000 to the Company for certain capital expenditures which may be required to expand capacity. In addition to the volume commitment, the Company has granted TIMET a first priority security interest in its four-high Steckel rolling mill, along with rights of access if the Company enters into bankruptcy or defaults on any financing arrangements. The Company has agreed not to manufacture titanium products (other than cold reduced titanium tubing). The Company has also agreed not to provide titanium hot-rolling conversion services to any entity other than TIMET for the term of the agreement. The agreement contains certain default provisions which could result in contract termination and damages, including liquidated damages of $25,000 and the Company being required to return the unearned portion of the up-front fee. The Company considered each provision and the likelihood of the occurrence of a default that would result in liquidated damages. Based on the nature of the events that could trigger the liquidated damages clause, and the availability of the cure periods set forth in the agreement, the Company determined and continues to believe that none of these circumstances are reasonably likely to occur. Therefore, events resulting in liquidated damages have not been factored in as a reduction to the amount of revenue recognized over the life of the contract. The cash received of $50,000 is recognized in income on a straight-line basis over the 20 -year term of the agreement. If an event of default occurred and was not cured within any applicable grace period, the Company would recognize the impact of the liquidated damages in the period of default and re-evaluate revenue recognition under the contract for future periods. The portion of the up-front fee not recognized in income is shown as deferred revenue on the consolidated balance sheet. In the first nine months of fiscal 2016, the Company received advance payments of $16,069 relate d to special projects of which $4,818 was recognized as revenue upon shipment, during the three month period ended June 30, 2016 . The remaining amount of $11,251 will be recognized as revenue when product ships to the customer.

Goodwill and Other Intangible A

Goodwill and Other Intangible Assets, Net	9 Months Ended
	Jun. 30, 2016
Goodwill and Other Intangible Assets, Net
Goodwill and Other Intangible Assets, Net	Note 8. Goodwill and Other Intangible Assets, Net The Company has goodwill, patents, trademarks, customer relationships and other intangibles. As the patents and customer relationships have a definite life, they are amortized over lives ranging from two to sixteen years. The company reviews patents and customer relationships for impairment whenever events or circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of the assets is measured by a comparison of the carrying amount of the asset to the discounted cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized in the amount by which the carrying amount exceeds the fair value of the asset. Goodwill and trademarks (indefinite lived) are tested for impairment at least annually as of January 31 for goodwill and August 31 for trademarks (the annual impairment testing dates), or more frequently if impairment indicators exist. If the carrying value of a trademark exceeds its fair value (determined using an income approach, based upon a discounted cash flow of an assumed royalty rate), impairment of the trademark may exist resulting in a charge to earnings to the extent of the impairment. The impairment test for goodwill is performed using a two-step approach. The first step is the estimation of the fair value of the relevant reporting unit, which is compared to its carrying value. No impairment was recognized in the period ended June 30, 2016 because the fair value of the Company’s reporting unit accounting for the Company’s goodwill (as described below) exceeded its carrying value. On January 7, 2015, the Company acquired the assets and operations of Leveltek Processing, LLC in LaPorte, Indiana for $14,600 in cash (See Note 14, Acquisition). In connection with the acquisition, the Company recorded goodwill of $4,789 and customer relationships intangible assets of $2,100 . As the customer relationships have a definite life, the Company amortizes them over a period of 16 years under an accelerated method and tests them for impairment at least annually as of August 31 (the annual impairment testing date). The following represents the changes in the carrying value of goodwill for the nine month period ended June 30, 2016: Goodwill at September 30, 2015 $ Adjustments — Goodwill at June 30, 2016 $ Amortization of customer relationships, patents, non-competes and other intangibles was $1 44 and $124 for the three-month periods ended June 30, 2015 and 2016, respectively, and $385 and $375 for the nine-month periods ended June 30, 2015 and 2016, respectively. The following represents a summary of intangible assets at September 30, 2015 and June 30, 2016: Gross Accumulated Carrying September 30, 2015 Amount Amortization Amount Patents $ $ $ Trademarks — Customer relationships Other $ $ $ Gross Accumulated Carrying June 30, 2016 Amount Amortization Amount Patents $ $ $ Trademarks — Customer relationships Other $ $ $ Estimated future Aggregate Amortization Expense: Year Ended September 30, 2016 2017 2018 2019 2020 Thereafter

Net Income (Loss) Per Share

Net Income (Loss) Per Share	9 Months Ended
	Jun. 30, 2016
Net Income (Loss) Per Share
Net Income (Loss) Per Share	Note 9. Net Income (Loss) Per Share The Company accounts for earnings per share using the two-class method. The two-class method is an earnings allocation that determines net income per share for each class of common stock and participating securities according to participation rights in undistributed earnings. Non-vested restricted stock awards that include non-forfeitable rights to dividends are considered participating securities. Per share amounts are computed by dividing net income attributable to common stockholders by the weighted average shares outstanding during each period. Basic earnings per share is computed by dividing net income available to common stockholders for the period by the weighted average number of common shares outstanding for the period. The computation of diluted earnings per share is similar to basic earnings per share, except the denominator is increased to include the number of additional common shares that would have been outstanding if the potentially dilutive common shares had been issued. The following table sets forth the computation of basic and diluted earnings (losses) per share: Three Months Ended Nine Months Ended June 30, June 30, (in thousands, except share and per share data) 2015 2016 2015 2016 Numerator: Basic and Diluted Net income $ $ $ $ Dividends paid Undistributed income (loss) Percentage allocated to common shares % % % % Undistributed income (loss) allocated to common shares Dividends paid on common shares outstanding Net income available to common shares Denominator: Basic and Diluted Weighted average common shares outstanding Adjustment for dilutive potential common shares Weighted average shares outstanding - Diluted Basic net income per share $ $ $ $ Diluted net income per share $ $ $ $ Number of stock option shares excluded as their effect would be anti-dilutive Number of restricted stock shares excluded as their effect would be anti-dilutive (a) Percentage allocated to common shares - Weighted average Common shares outstanding Unvested participating shares

Stock-Based Compensation

Stock-Based Compensation	9 Months Ended
	Jun. 30, 2016
Stock-Based Compensation
Stock-Based Compensation	Note 10. Stock-Based Compensation Restricted Stock Plan On February 23, 2009, the Company adopted a restricted stock plan that reserved 400,000 shares of common stock for issuance. Grants of restricted stock are grants of shares of the Company’s common stock subject to transfer restrictions, which vest in accordance with the terms and conditions established by the Compensation Committee. The Compensation Committee may set vesting requirements based on the achievement of specific performance goals or the passage of time. After November 24, 2015, the Company is no longer granting awards from this plan. Restricted shares are subject to forfeiture if employment or service terminates prior to the vesting date or if any applicable performance goals are not met. The Company will assess, on an ongoing basis, the probability of whether the performance criteria will be achieved. The Company will recognize compensation expense over the performance period if it is deemed probable that the goals will be achieved. The fair value of the Company’s restricted stock is determined based upon the closing price of the Company’s common stock on the grant date. The plan provides for the adjustment of the number of shares covered by an outstanding grant and the maximum number of shares for which restricted stock may be granted in the event of a stock split, extraordinary dividend or distribution or similar recapitalization event. On November 24, 2015, the Company granted 54,210 shares of restricted stock to certain key employees and non-employee directors. The time-based shares of restricted stock granted to employees will vest on the third anniversary of their grant date if the recipient is still an employee of the Company on such date. The performance-based shares will vest in equal installments on the first , second and third anniversaries of their grant date provided that (a) the recipient is still an employee of the Company on such date and (b) the Company has met annual net income performance goals set by the Company’s Compensation Committee, provided that, if the Company has exceeded a total net income performance goal for the three year period, restricted shares that did not vest due to the Company’s failure to meet the annual net income performance goals will vest at the end of such three year period. The shares of restricted stock granted to non-employee directors will vest on the earlier of (a) the first anniversary of the date of grant or (b) the failure of such non-employee director to be re-elected at an annual meeting of the stockholders of the Company as a result of such non-employee director being excluded from the nominations for any reason other than cause. The fair value of the grants was $37.75 per share, the closing price of the Company’s common stock on the trading day immediately preceding the day of the applicable grant. The following table summarizes the activity under the restricted stock plan for the nine months ended June 30, 2016: Weighted Average Fair Number of Value At Shares Grant Date Unvested at September 30, 2015 $ Granted $ Forfeited / Canceled $ Vested $ Unvested at June 30, 2016 $ Expected to vest $ Compensation expense related to restricted stock for the three months ended June 30, 2015 and 2016 was $442 and $411 , respectively and for the nine months ended June 30, 2015 and 2016 was $1,211 and $1,045 , respectively. The remaining unrecognized compensation expense related to restricted stock at June 30, 2016 was $2, 006 , to be recognized over a weighted average period of 0.73 years. During the first quarter of fiscal 2016, the Company repurchased 7,661 shares of stock from employees at an average purchase price of $37.72 to satisfy required withholding taxes upon vesting of restricted stock-based compensation. Stock Option Plans The Company has two stock option plans that authorize the granting of non-qualified stock options to certain key employees and non-employee directors for the purchase of a maximum of 1,500,000 shares of the Company’s common stock. The first option plan was adopted in August 2004 and provides for the grant of options to purchase up to 1,000,000 shares of the Company’s common stock. In January 2007, the Company’s Board of Directors adopted a second option plan that provides for options to purchase up to 500,000 shares of the Company’s common stock. Each plan provides for the adjustment of the maximum number of shares for which options may be granted in the event of a stock split, extraordinary dividend or distribution or similar recapitalization event. Unless the Compensation Committee determines otherwise, options granted under the option plans are exercisable for a period of ten years from the date of grant and vest 33 1 / 3 % per year over three years from the grant date. The amount of compensation cost recognized in the financial statements is measured based upon the grant date fair value. After November 24, 2015, the Company is no longer granting awards from these plans. The fair value of option grants is estimated as of the date of the grant . The Company has elected to use the Black-Scholes option pricing model, which incorporates various assumptions including volatility, expected life, risk-free interest rates, expected forfeitures and dividend yields. The volatility is based on historical volatility of the Company’s common stock over the most recent period commensurate with the estimated expected term of the stock option granted. The Company uses historical volatility because management believes such volatility is representative of prospective trends. The expected term of an award is based on historical exercise data. The risk-free interest rate assumption is based upon observed interest rates appropriate for the expected term of the awards. The expected forfeiture rate is based upon historical experience. The dividend yield assumption is based on the Company’s history and expectations regarding dividend payouts at the time of the grant. Valuation of future grants under the Black-Scholes model will include a dividend yield. The following assumptions were used for grants in the first quarter of fiscal 2016: Fair Dividend Risk-free Expected Expected Grant Date Value Yield Interest Rate Volatility Life November 24, 2015 $ % % % years On November 24, 2015, the Company granted 79,800 options at an exercise price of $37.75 , the fair market value of the Company’s common stock the day of the grant. During the first nine months of fiscal 2016, 10,000 options were exercised. The stock-based employee compensation expense for stock options for the three months ended June 30, 2015 and 2016 was $136 and $127 , respectively and for the nine months ended June 30, 2015 and 2016 was $ 398 and $ 387 , respectively. The remaining unrecognized compensation expense at June 30, 2016 was $ 891 to be recognized over a weighted average vesting period of 1.34 years. The following tables summarize the activity under the stock option plans for the nine months ended June 30, 2016 and provide information regarding outstanding stock options: Weighted Aggregate Weighted Average Intrinsic Average Remaining Number of Value Exercise Contractual Shares (000s) Prices Life Outstanding at September 30, 2015 $ Granted $ Exercised $ Canceled — $ — Outstanding at June 30, 2016 $ $ yrs. Vested or expected to vest $ $ yrs. Exercisable at June 30, 2016 $ $ yrs. Remaining Outstanding Exercisable Exercise Price Contractual Number of Number of Grant Date Per Share Life in Years Shares Shares March 30, 2007 March 31, 2008 October 1, 2008 March 31, 2009 January 8, 2010 November 24, 2010 November 25, 2011 November 20, 2012 December 10, 2012 November 26, 2013 November 25, 2014 November 24, 2015 — 2016 Incentive Compensation Plan On March 1, 2016, the Company adopted the 2016 Incentive Compensation Plan which provides for grants of restricted stock, restricted stock units, performance shares, stock options and stock appreciation rights. Up to 275,000 shares of restricted stock, restricted stock units and performance shares may be granted in the aggregate under the plan. Up to 425,000 stock options and stock appreciation rights may be granted in the aggregate under the plan. The plan provides for adjustment of the maximum number of awards to be granted under certain circumstances, including in the event of a merger, reorganization, stock split or similar recapitalization event. Grants may be subject to performance goals or may be time-based. Awards may be subject to forfeiture if employment or service terminates prior to the end of the vesting period or if any applicable performance goals are not met. The Company will assess, on an ongoing basis, the probability of whether performance goals will be achieved. The Company will recognize compensation expense over the performance period if it is deemed probable that the goals will be achieved. The fair value of the grants is determined based upon the closing price of the Company’s common stock on the grant date.

Dividend

Dividend	9 Months Ended
	Jun. 30, 2016
Dividend
Dividend	Note 11. Dividend In the third quarter of fiscal 2016, the Company declared and paid a quarterly cash dividend. The dividend of $0.22 per outstanding share of the Company’s common stock was paid June 15, 2016 to stockholders of record at the close of business on June 1, 2016. The dividend cash pay-out was $2,748 for the quarter based on the number of shares outstanding. On August 4, 2016, the Company announced that the Board of Directors declared a regular quarterly cash dividend of $0.22 per outstanding share of the Company’s common stock. The dividend is payable September 15, 2016 to stockholders of record at the close of business on September 1, 2016.

Fair Value Measurements

Fair Value Measurements	9 Months Ended
	Jun. 30, 2016
Fair Value Measurements
Fair Value Measurements	Note 12. Fair Value Measurements The fair value hierarchy has three levels based on the inputs used to determine fair value. · Level 1 — Quoted prices in active markets that are unadjusted and accessible at the measurement date for identical, unrestricted assets or liabilities; · Level 2 — Quoted prices for identical assets and liabilities in markets that are not active, quoted prices for similar assets and liabilities in active markets or financial instruments for which significant inputs are observable, either directly or indirectly; and · Level 3 — Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable. When available, the Company uses unadjusted quoted market prices to measure fair value and classifies such items within Level 1. If quoted market prices are not available, fair value is based upon internally-developed models that use, where possible, current market-based or independently-sourced market parameters such as interest rates and currency rates. Items valued using internally-generated models are classified according to the lowest level input or value driver that is significant to the valuation. If quoted market prices are not available, the valuation model used depends on the specific asset or liability being valued. Money market funds included in cash and cash equivalents of $49,045 and $44,418 as of September 30, 2015 and June 30, 2016, respectively, are considered Level 1.

Changes in Accumulated Other Co

Changes in Accumulated Other Comprehensive Income (Loss) by Component	9 Months Ended
	Jun. 30, 2016
Changes in Accumulated Other Comprehensive Income (Loss) by Component
Changes in Accumulated Other Comprehensive Income (Loss) by Component	Note 13. Changes in Accumulated Other Comprehensive Income (Loss) by Component Comprehensive income (loss) includes changes in equity that result from transactions and economic events from non-owner sources. Comprehensive income (loss) consists of net income and other comprehensive income (loss) items, including pension and foreign currency translation adjustments, primarily caused by the strengthening of the US dollar against the British pound sterling, net of tax when applicable. Accumulated Other Comprehensive Income (Loss) Three Months Ended June 30, 2015 Pension Postretirement Foreign Plan Plan Exchange Total Accumulated other comprehensive loss as of March 31, 2015 $ $ $ $ Other comprehensive income before reclassifications — — Amounts reclassified from accumulated other comprehensive income (loss) Amortization of Pension and Postretirement Plan items (a) — — Actuarial losses (a) — Tax benefit — Net current-period other comprehensive income Accumulated other comprehensive loss as of June 30, 2015 $ $ $ $ Three Months Ended June 30, 2016 Pension Postretirement Foreign Plan Plan Exchange Total Accumulated other comprehensive loss as of March 31, 2016 $ $ $ $ Other comprehensive loss before reclassifications — — Amounts reclassified from accumulated other comprehensive income (loss) Amortization of Pension and Postretirement Plan items (a) — — Actuarial losses (a) — Tax benefit — Net current-period other comprehensive income (loss) Accumulated other comprehensive loss as of June 30, 2016 $ $ $ $ Nine Months Ended June 30, 2015 Pension Postretirement Foreign Plan Plan Exchange Total Accumulated other comprehensive income (loss) as of September 30, 2014 $ $ $ $ Other comprehensive loss before reclassifications — — Amounts reclassified from accumulated other comprehensive income (loss) Amortization of Pension and Postretirement Plan items (a) — — Actuarial losses (a) — Tax benefit — Net current-period other comprehensive income (loss) Accumulated other comprehensive loss as of June 30, 2015 $ $ $ $ Nine Months Ended June 30, 2016 Pension Postretirement Foreign Plan Plan Exchange Total Accumulated other comprehensive loss as of September 30, 2015 $ $ $ $ Other comprehensive loss before reclassifications — — Amounts reclassified from accumulated other comprehensive income (loss) Amortization of Pension and Postretirement Plan items (a) — — Actuarial losses (a) — Tax benefit — Net current-period other comprehensive income (loss) Accumulated other comprehensive loss as of June 30, 2016 $ $ $ $ (a) These accumulated other comprehensive income components are included in the computation of net periodic pension cost.

Acquisition

Acquisition	9 Months Ended
	Jun. 30, 2016
Acquisition
Acquisition	Note 14. Acquisition On January 7, 2015, the Company acquired the assets and operations of Leveltek Processing, LLC located in LaPorte, Indiana for $14,600 in cash. The acquisition of the LaPorte assets provides the Company control of sheet stretching, leveling, slitting and cut-to-length operations that were previously outsourced functions. Acquisition costs incurred in the first quarter of fiscal 2015 were not significant. The acquired business is being operated by LaPorte Custom Metal Processing, LLC (LCMP), a wholly-owned subsidiary of the Company. The following is a summary of the purchase price allocation in connection with the LCMP acquisition. The determination of fair value for acquired assets includes the use of Level 3 inputs, such as the condition and utilization of the property, plant and equipment acquired, management’s projected financial results for LCMP, and the discount rate used to determine the present value of anticipated future cash flows. Purchase Price Allocation Property, plant and equipment, net $ Customer relationships Inventory Total identifiable net assets Goodwill Total purchase price $ The goodwill recognized in connection with the Leveltek-LaPorte assets consists of the value associated with the addition of the stretching and leveling capabilities as well as increased capacity in slitting and cut-to-length operations to meet customer demand and is tax deductible. The complementary asset capabilities are expected to lead to operating cost synergies as well as expand the Company’s commercial offerings.

Capital Lease Obligation

Capital Lease Obligation	9 Months Ended
	Jun. 30, 2016
Leases, Capital [Abstract]
Capital lease obligation	Note 15. Capital Lease Obligation On January 1, 2015, the Company entered into a capital lease agreement for the building that houses the assets and operations of LCMP. The capital asset and obligation are recorded at the present value of the minimum lease payments. The asset is included in property, plant and equipment, net on the Consolidated Balance Sheet and is depreciated over the 20 year lease term. The long-term component of the capital lease obligation is included in long-term obligations. As of June 30, 2016, future minimum lease rental payments during each fiscal year applicable to the capital lease were as follows. 2016 (remainder of fiscal year) $ 2017 2018 2019 2020 Thereafter Total minimum capital lease payments Less amounts representing interest Present value of net minimum capital lease payments Less current obligation Total long term capital lease obligation $ The capital lease obligation is included in long-term obligations (less current portion) on the Consolidated Balance Sheet. September 30, June 30, 2015 2016 Future capital lease rental payments $ $ Environmental post-closure monitoring and maintenance activities Less amounts due within one year Long-term obligations (less current portion) $ $

Restricted Cash

Restricted Cash	9 Months Ended
	Jun. 30, 2016
Restricted Cash
Restricted Cash	Note 16. Restricted Cash In the first nine months of fiscal 2016, the Company received advance payments of $16,069 relate d to special projects . Of this amount, the Company is restricted from having access to $9,200 until such time as the Company delivers product to the customer. As the Company begins to fulfill the order, the restricted cash will become unrestricted on a pro-rata basis based upon the percentage fulfillment of the order. In July 2016, $2,481 of cash that was restricted as of June 30, 2016, became unrestricted as a result of June shipments.

Expansion of LaPorte, Indiana O

Expansion of LaPorte, Indiana Operations	9 Months Ended
	Jun. 30, 2016
Expansion of LaPorte, Indiana Operations
Expansion of LaPorte, Indiana Operations	Note 17. Expansion of LaPorte, Indiana Operations The Company announced on May 2, 2016 its decision to expand and streamline its distribution footprint by investing in new plant and equipment at its processing facility located in LaPorte, Indiana. In connection with the expansion, the Company plans to relocate its service center operations in Lebanon, Indiana to LaPorte. The project is expected to begin in the fourth quarter of calendar 2016 and be completed by the end of calendar 2017. Costs associated with the project are estimated to consist of approximately $1,800 to $2,500 relating to equipment relocation and approximately $500 to $1,100 in other costs, including one-time termination benefits, relocation expenses and lease termination costs, for a total of approximately $2,300 to $3,600 in total costs relating to the move. Approximately $340 of these costs were expensed in the third quarter of fiscal 2016, and the remainder will be recorded as incurred over the project period.

Basis of Presentation (Policies

Basis of Presentation (Policies)	9 Months Ended
	Jun. 30, 2016
Basis of Presentation
Principles of Consolidation	Principles of Consolidation The consolidated financial statements include the accounts of Haynes International, Inc. and its directly and indirectly wholly-owned subsidiaries (collectively, the “Company”). All intercompany transactions and balances are eliminated.

Inventories (Tables)

Inventories (Tables)	9 Months Ended
	Jun. 30, 2016
Inventories
Summary of major classes of inventories	September 30, June 30, 2015 2016 Raw Materials $ $ Work-in-process Finished Goods Other $ $

Pension and Post-retirement B26

Pension and Post-retirement Benefits (Tables)	9 Months Ended
	Jun. 30, 2016
Pension and Post-retirement Benefits
Schedule of components of net periodic pension and postretirement benefit cost	Three Months Ended June 30, Nine Months Ended June 30, Pension Benefits Other Benefits Pension Benefits Other Benefits 2015 2016 2015 2016 2015 2016 2015 2016 Service cost $ $ $ $ $ $ $ $ Interest cost Expected return — — — — Amortizations Net periodic benefit cost $ $ $ $ $ $ $ $

Legal, Environmental and Othe27

Legal, Environmental and Other Contingencies (Tables)	9 Months Ended
	Jun. 30, 2016
Legal, Environmental and Other Contingencies
Schedule of maturities of long-term obligations (discounted)	2016 $ — 2017 2018 2019 2020 2021 and thereafter $

Goodwill and Other Intangible28

Goodwill and Other Intangible Assets, Net (Tables)	9 Months Ended
	Jun. 30, 2016
Goodwill and Other Intangible Assets, Net
Schedule Changes in the carrying value of goodwill	Goodwill at September 30, 2015 $ Adjustments — Goodwill at June 30, 2016 $
Summary of intangible assets	Gross Accumulated Carrying September 30, 2015 Amount Amortization Amount Patents $ $ $ Trademarks — Customer relationships Other $ $ $ Gross Accumulated Carrying June 30, 2016 Amount Amortization Amount Patents $ $ $ Trademarks — Customer relationships Other $ $ $
Schedule of estimated future aggregate amortization expense	Estimated future Aggregate Amortization Expense: Year Ended September 30, 2016 2017 2018 2019 2020 Thereafter

Net Income (Loss) Per Share (Ta

Net Income (Loss) Per Share (Tables)	9 Months Ended
	Jun. 30, 2016
Net Income (Loss) Per Share
Schedule of basic and diluted net earnings (losses) per share	Three Months Ended Nine Months Ended June 30, June 30, (in thousands, except share and per share data) 2015 2016 2015 2016 Numerator: Basic and Diluted Net income $ $ $ $ Dividends paid Undistributed income (loss) Percentage allocated to common shares % % % % Undistributed income (loss) allocated to common shares Dividends paid on common shares outstanding Net income available to common shares Denominator: Basic and Diluted Weighted average common shares outstanding Adjustment for dilutive potential common shares Weighted average shares outstanding - Diluted Basic net income per share $ $ $ $ Diluted net income per share $ $ $ $ Number of stock option shares excluded as their effect would be anti-dilutive Number of restricted stock shares excluded as their effect would be anti-dilutive (a) Percentage allocated to common shares - Weighted average Common shares outstanding Unvested participating shares

Stock-Based Compensation (Table

Stock-Based Compensation (Tables)	9 Months Ended
	Jun. 30, 2016
Stock-Based Compensation
Summary of activity under the restricted stock plan	Weighted Average Fair Number of Value At Shares Grant Date Unvested at September 30, 2015 $ Granted $ Forfeited / Canceled $ Vested $ Unvested at June 30, 2016 $ Expected to vest $
Schedule of fair value assumptions used for grants under the stock option plan	Fair Dividend Risk-free Expected Expected Grant Date Value Yield Interest Rate Volatility Life November 24, 2015 $ % % % years
Summary of activity under the stock option plans	Weighted Aggregate Weighted Average Intrinsic Average Remaining Number of Value Exercise Contractual Shares (000s) Prices Life Outstanding at September 30, 2015 $ Granted $ Exercised $ Canceled — $ — Outstanding at June 30, 2016 $ $ yrs. Vested or expected to vest $ $ yrs. Exercisable at June 30, 2016 $ $ yrs. Remaining Outstanding Exercisable Exercise Price Contractual Number of Number of Grant Date Per Share Life in Years Shares Shares March 30, 2007 March 31, 2008 October 1, 2008 March 31, 2009 January 8, 2010 November 24, 2010 November 25, 2011 November 20, 2012 December 10, 2012 November 26, 2013 November 25, 2014 November 24, 2015 —

Changes in Accumulated Other 31

Changes in Accumulated Other Comprehensive Income (Loss) by Component (Tables)	9 Months Ended
	Jun. 30, 2016
Changes in Accumulated Other Comprehensive Income (Loss) by Component
Schedule of accumulated other comprehensive income (loss)	Three Months Ended June 30, 2015 Pension Postretirement Foreign Plan Plan Exchange Total Accumulated other comprehensive loss as of March 31, 2015 $ $ $ $ Other comprehensive income before reclassifications — — Amounts reclassified from accumulated other comprehensive income (loss) Amortization of Pension and Postretirement Plan items (a) — — Actuarial losses (a) — Tax benefit — Net current-period other comprehensive income Accumulated other comprehensive loss as of June 30, 2015 $ $ $ $ Three Months Ended June 30, 2016 Pension Postretirement Foreign Plan Plan Exchange Total Accumulated other comprehensive loss as of March 31, 2016 $ $ $ $ Other comprehensive loss before reclassifications — — Amounts reclassified from accumulated other comprehensive income (loss) Amortization of Pension and Postretirement Plan items (a) — — Actuarial losses (a) — Tax benefit — Net current-period other comprehensive income (loss) Accumulated other comprehensive loss as of June 30, 2016 $ $ $ $ Nine Months Ended June 30, 2015 Pension Postretirement Foreign Plan Plan Exchange Total Accumulated other comprehensive income (loss) as of September 30, 2014 $ $ $ $ Other comprehensive loss before reclassifications — — Amounts reclassified from accumulated other comprehensive income (loss) Amortization of Pension and Postretirement Plan items (a) — — Actuarial losses (a) — Tax benefit — Net current-period other comprehensive income (loss) Accumulated other comprehensive loss as of June 30, 2015 $ $ $ $ Nine Months Ended June 30, 2016 Pension Postretirement Foreign Plan Plan Exchange Total Accumulated other comprehensive loss as of September 30, 2015 $ $ $ $ Other comprehensive loss before reclassifications — — Amounts reclassified from accumulated other comprehensive income (loss) Amortization of Pension and Postretirement Plan items (a) — — Actuarial losses (a) — Tax benefit — Net current-period other comprehensive income (loss) Accumulated other comprehensive loss as of June 30, 2016 $ $ $ $ (a) These accumulated other comprehensive income components are included in the computation of net periodic pension cost.

Acquisition (Tables)

Acquisition (Tables)	9 Months Ended
	Jun. 30, 2016
Acquisition
Summary of the purchase price allocation	Purchase Price Allocation Property, plant and equipment, net $ Customer relationships Inventory Total identifiable net assets Goodwill Total purchase price $

Capital Lease Obligation (Table

Capital Lease Obligation (Tables)	9 Months Ended
	Jun. 30, 2016
Leases, Capital [Abstract]
Schedule of future minimum lease rental payments applicable to the capital lease	2016 (remainder of fiscal year) $ 2017 2018 2019 2020 Thereafter Total minimum capital lease payments Less amounts representing interest Present value of net minimum capital lease payments Less current obligation Total long term capital lease obligation $
Schedule of capital lease obligation included in Long-term obligations (Less current portion)	September 30, June 30, 2015 2016 Future capital lease rental payments $ $ Environmental post-closure monitoring and maintenance activities Less amounts due within one year Long-term obligations (less current portion) $ $

Inventories (Details)

Inventories (Details) - USD ($) $ in Thousands	Jun. 30, 2016	Sep. 30, 2015
Inventories
Raw Materials	$ 21,975	$ 27,152
Work-in-process	109,668	117,601
Finished Goods	112,680	101,731
Other	1,303	1,352
Total	$ 245,626	$ 247,836

Income Taxes (Details)

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Income Taxes
Statutory federal tax rate (as a percent)	35.00%	35.00%	35.00%	35.00%
Effective tax rate (as a percent)	7.80%	39.10%	14.00%	34.60%
Decrease in tax expense attributable to research and development tax credit			$ 800

Pension and Post-retirement B36

Pension and Post-retirement Benefits (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Defined Benefit Pension Plans
Pension Plan and Retirement Benefits
Service cost	$ 1,020	$ 975	$ 3,060	$ 2,924
Interest cost	2,549	2,787	8,262	8,010
Expected return	(2,978)	(3,761)	(9,753)	(10,807)
Amortizations	2,320	1,381	7,086	4,097
Net periodic benefit cost	2,911	1,382	8,655	4,224
U.S. pension plan
Pension Plan and Retirement Benefits
Employer contribution			4,500
Expected future employer contribution			1,500
U.K. pension plan
Pension Plan and Retirement Benefits
Employer contribution			651
Expected future employer contribution			200
Postretirement Health Care Benefits
Pension Plan and Retirement Benefits
Service cost	58	84	174	253
Interest cost	1,149	1,097	3,447	3,289
Amortizations	706	608	2,118	1,825
Net periodic benefit cost	$ 1,913	$ 1,789	5,739	$ 5,367
Employer contribution			4,569
Expected future employer contribution			$ 1,250

Legal, Environmental and Othe37

Legal, Environmental and Other Contingencies - Overview (Details)	9 Months Ended
	Jun. 30, 2016actionitem
Welding rod-related injuries | Pending litigation
Legal, Environmental and Other Contingencies
Number of actions in which the entity is involved | action	2
Asbestos in facilities | Pending litigation
Legal, Environmental and Other Contingencies
Number of actions in which the entity is involved | action	3
Site contingency
Legal, Environmental and Other Contingencies
Number of areas of concern that required investigation | item	1
Number of solid waste management units evaluated under RCRA, as required by IDEM | item	1

Legal, Environmental and Othe38

Legal, Environmental and Other Contingencies - Schdule of Maturities (Details) - USD ($) $ in Thousands	Jun. 30, 2016	Sep. 30, 2015
Environmental post-closure monitoring and maintenance activities	$ 749	$ 749
Long-term obligations (less current portion)
Maturities of long-term obligations (discounted)
2,017	73
2,018	77
2,019	58
2,020	49
2021 and thereafter	405
Long-term obligations (less current portion)	$ 662

Deferred Revenue (Details)

Deferred Revenue (Details) $ in Thousands, lb in Millions	Nov. 17, 2006USD ($)	Jun. 30, 2016USD ($)	Jun. 30, 2016USD ($)lb
Deferred revenue
Up-front/advance payment received			$ 16,069
Recorded as revenue upon shipment		$ 4,818
Revenue to be recorded when product ships		$ 11,251	$ 11,251
Conversion Services Agreement
Deferred revenue
Term of agreement to provide conversion services	20 years
Up-front/advance payment received	$ 50,000
Additional volume of titanium metal to be converted on exercise of option by service receiver (in pounds) | lb			10
Liquidated damages			$ 25,000
Revenue recognition period			20 years
Conversion Services Agreement | Maximum
Deferred revenue
Annual volume of titanium metal to be converted (in pounds) | lb			10
Amount of loan offered by counterparty			$ 12,000

Goodwill and Other Intangible40

Goodwill and Other Intangible Assets, Net - Overview (Details) - USD ($) $ in Thousands	Jan. 07, 2015	Jun. 30, 2016	Sep. 30, 2015
Goodwill and Other Intangible Assets, Net
Goodwill impairment charges		$ 0
Goodwill		$ 4,789	$ 4,789
Leveltek Processing, LLC
Goodwill and Other Intangible Assets, Net
Acquisition price	$ 14,600
Goodwill	4,789
Customer relationships	2,100
Patents | Minimum
Goodwill and Other Intangible Assets, Net
Useful life		2 years
Patents | Maximum
Goodwill and Other Intangible Assets, Net
Useful life		16 years
Customer relationships | Minimum
Goodwill and Other Intangible Assets, Net
Useful life		2 years
Customer relationships | Maximum
Goodwill and Other Intangible Assets, Net
Useful life		16 years
Customer relationships | Leveltek Processing, LLC
Goodwill and Other Intangible Assets, Net
Useful life		16 years
Customer relationships	$ 2,100

Goodwill and Other Intangible41

Goodwill and Other Intangible Assets, Net - Goodwill (Details) $ in Thousands	9 Months Ended
	Jun. 30, 2016USD ($)
Goodwill and Other Intangible Assets, Net
Goodwill, Beginning Balance	$ 4,789
Adjustments
Goodwill, Ending Balance	$ 4,789

Goodwill and Other Intangible42

Goodwill and Other Intangible Assets, Net - Intangible Assets (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015	Sep. 30, 2015
Intangible Assets
Amortization of customer relationships, patents, non-competes and other intangibles	$ 124	$ 144	$ 375	$ 385
Finite-Lived Intangible Assets, Gross	10,260		10,260		$ 10,260
Finite-lived intangible assets, Accumulated Amortization	(3,861)		(3,861)		(3,486)
Finite-lived intangible assets, Carrying Amount	6,399		6,399		6,774
Patents
Intangible Assets
Finite-Lived Intangible Assets, Gross	4,030		4,030		4,030
Finite-lived intangible assets, Accumulated Amortization	(3,300)		(3,300)		(3,091)
Finite-lived intangible assets, Carrying Amount	730		730		939
Customer relationships
Intangible Assets
Finite-Lived Intangible Assets, Gross	2,100		2,100		2,100
Finite-lived intangible assets, Accumulated Amortization	(236)		(236)		(119)
Finite-lived intangible assets, Carrying Amount	1,864		1,864		1,981
Other
Intangible Assets
Finite-Lived Intangible Assets, Gross	330		330		330
Finite-lived intangible assets, Accumulated Amortization	(325)		(325)		(276)
Finite-lived intangible assets, Carrying Amount	5		5		54
Trademarks
Intangible Assets
Finite-Lived Intangible Assets, Gross	3,800		3,800		3,800
Finite-lived intangible assets, Carrying Amount	$ 3,800		$ 3,800		$ 3,800

Goodwill and Other Intangible43

Goodwill and Other Intangible Assets, Net - Amortization Expense (Details) $ in Thousands	Jun. 30, 2016USD ($)
Estimate of Aggregate Amortization Expense:
2016 (remainder of fiscal year)	$ 115
2,017	431
2,018	427
2,019	245
2,020	140
Thereafter	$ 1,241

Net Income (Loss) Per Share - C

Net Income (Loss) Per Share - Computation (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Numerator: Basic and Diluted
Net income	$ 2,792	$ 6,602	$ 1,858	$ 24,702
Dividends paid	(2,748)	(2,738)	(8,240)	(8,214)
Undistributed income (loss)	$ 44	$ 3,864	$ (6,382)	$ 16,488
Percentage allocated to common shares	99.00%	99.10%	99.00%	99.10%
Undistributed income (loss) allocated to common shares	$ 44	$ 3,829	$ (6,321)	$ 16,339
Dividends paid on common shares outstanding	2,721	2,713	8,160	8,140
Net income available to common shares	$ 2,765	$ 6,542	$ 1,839	$ 24,479
Denominator: Basic and Diluted
Weighted average common shares outstanding	12,370,039	12,333,550	12,358,609	12,330,994
Adjustment for dilutive potential common shares	2,278	13,244	4,761	12,678
Weighted average shares - Diluted	12,372,317	12,346,794	12,363,370	12,343,672
Basic net income per share (in dollars per share)	$ 0.22	$ 0.53	$ 0.15	$ 1.99
Diluted net income per share (in dollars per share)	$ 0.22	$ 0.53	$ 0.15	$ 1.98

Net Income (Loss) Per Share - A

Net Income (Loss) Per Share - Anit-dilutive Securities (Details) - shares	3 Months Ended		9 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Stock Options
Antidilutive securities
Number of shares excluded as their effect would be anti-dilutive	383,202	290,255	380,302	290,255
Restricted Stock
Antidilutive securities
Number of shares excluded as their effect would be anti-dilutive	121,010	112,450	121,243	112,550

Net Income (Loss) Per Share - W

Net Income (Loss) Per Share - Weighted Average Common Shares (Details) - shares	3 Months Ended		9 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Percentage allocated to common shares - weighted average
Common shares outstanding	12,370,039	12,333,550	12,358,609	12,330,994
Unvested participating shares	121,010	112,450	121,243	112,550
Total	12,491,049	12,446,000	12,479,852	12,443,544

Stock-Based Compensation - Rest

Stock-Based Compensation - Restricted Stock Plan (Details) - Restricted Stock - USD ($) $ / shares in Units, $ in Thousands	Nov. 24, 2015	Jun. 30, 2016	Dec. 31, 2015	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015	Feb. 23, 2009
Restricted stock plan activity, number of shares
Unvested at beginning of the period (in shares)			111,450		111,450
Granted (in shares)					54,210
Forfeited / Canceled (in shares)					(11,400)
Vested (in shares)					(33,250)
Unvested at end of the period (in shares)		121,010			121,010
Expected to vest (in shares)		94,660			94,660
Restricted stock plan activity, Weighted Average Fair Value at Grant Date
Unvested at beginning of the period (in dollars per share)			$ 49.07		$ 49.07
Granted (in dollars per share)					37.75
Forfeited / Canceled (in dollars per share)					48.05
Vested (in dollars per share)					47.56
Unvested at end of the period (in dollars per share)		$ 44.51			44.51
Expected to vest (in dollars per share)		$ 43.12			$ 43.12
Restricted stock plan activity, other disclosures
Compensation expense		$ 411		$ 442	$ 1,045	$ 1,211
Remaining unrecognized compensation expense		$ 2,006			$ 2,006
Weighted average period for recognition					8 months 23 days
Employees
Restricted stock plan activity, other disclosures
Repurchase of stock from employees (in shares)			7,661
Average purchase price (in dollars per share)			$ 37.72
Key employees and non-employee directors
Restricted stock plan activity, number of shares
Granted (in shares)	54,210
Restricted stock plan activity, Weighted Average Fair Value at Grant Date
Granted (in dollars per share)	$ 37.75
2009 Restricted Stock Plan
Stock-Based Compensation
Number of shares authorized under the plan							400,000
Time-based vesting | Employees
Stock-Based Compensation
Award vesting period	3 years
Time-based vesting | Non-employee director | Maximum
Stock-Based Compensation
Award vesting period	1 year
Performance-based vesting | Employees
Stock-Based Compensation
Award vesting period	3 years
Period of performance goal based on net income used for determination of vesting period	3 years
Performance-based vesting | Employees | Vesting period, Tranche one
Stock-Based Compensation
Award vesting period	1 year
Performance-based vesting | Employees | Vesting period, Tranche two
Stock-Based Compensation
Award vesting period	2 years
Performance-based vesting | Employees | Vesting period, Tranche three
Stock-Based Compensation
Award vesting period	3 years

Stock-Based Compensation - Stoc

Stock-Based Compensation - Stock Option Plans (Details) - Stock Options $ / shares in Units, $ in Thousands	Nov. 24, 2015$ / sharesshares	Jun. 30, 2016USD ($)$ / sharesshares	Jun. 30, 2015USD ($)	Jun. 30, 2016USD ($)plan$ / sharesshares	Jun. 30, 2015USD ($)
Information relating to stock options
Number of plans | plan				2
Number of shares authorized		1,500,000		1,500,000
Period during which options are exercisable				10 years
Vesting of awards per year (as a percent)				33.33%
Award vesting period				3 years
Fair value assumptions
Fair Value (in dollars per share) | $ / shares	$ 8.37
Dividend Yield (as a percent)	2.33%
Risk-Free Interest Rate (as a percent)	1.70%
Expected Volatility (as a percent)	30.00%
Expected Life	5 years
Stock-based employee compensation expense | $		$ 127	$ 136	$ 387	$ 398
Remaining unrecognized compensation expense | $		$ 891		$ 891
Weighted average period for recognition				1 year 4 months 2 days
Activity under stock option plans, number of shares
Outstanding at beginning of the period (in shares)				358,601
Granted (in shares)	79,800			79,800
Exercised (in shares)				(10,000)
Outstanding at end of the period (in shares)		428,401		428,401
Vested or expected to vest (in shares)		399,336		399,336
Exercisable at end of period (in shares)		279,453		279,453
Outstanding at end of period, Aggregate Intrinsic Value | $		$ 172		$ 172
Vested or expected to vest, Aggregate Intrinsic Value | $		172		172
Exercisable at end of the period, Aggregate Intrinsic Value | $		$ 172		$ 172
Weighted Average Exercise Prices
Outstanding at beginning of the period (in dollars per share) | $ / shares				$ 50.37
Granted (in dollars per share) | $ / shares	$ 37.75			37.75
Exercised (in dollars per share) | $ / shares				31
Outstanding at end of period (in dollars per share) | $ / shares		$ 48.47		48.47
Vested or expected to vest (in dollars per share) | $ / shares		48.70		48.70
Exercisable at end of the period (in dollars per share) | $ / shares		$ 51.64		$ 51.64
Outstanding at end of the period, Weighted Average Remaining Contractual Life				5 years 8 months 23 days
Vested or expected to vest, Weighted Average Remaining Contractual Life				5 years 7 months 2 days
Exercisable at end of the period, Weighted Average Remaining Contractual Life				4 years 26 days
Original option plan August 2004
Information relating to stock options
Number of shares authorized		1,000,000		1,000,000
Second option plan January 2007
Information relating to stock options
Number of shares authorized		500,000		500,000

Stock-Based Compensation - Outs

Stock-Based Compensation - Outstanding Stock Options (Details) - Stock Options	9 Months Ended
	Jun. 30, 2016$ / sharesshares
Stock-Based Compensation
Outstanding Number of Shares	428,401
Exercisable Number of Shares	279,453
Exercise Price Per Share $72.93
Stock-Based Compensation
Exercise Price Per Share (in dollars per share) | $ / shares	$ 72.93
Remaining Contractual Life	9 months
Outstanding Number of Shares	45,500
Exercisable Number of Shares	45,500
Exercise Price Per Share $54.00
Stock-Based Compensation
Exercise Price Per Share (in dollars per share) | $ / shares	$ 54
Remaining Contractual Life	1 year 9 months
Outstanding Number of Shares	55,500
Exercisable Number of Shares	55,500
Exercise Price Per Share $46.83
Stock-Based Compensation
Exercise Price Per Share (in dollars per share) | $ / shares	$ 46.83
Remaining Contractual Life	2 years 3 months
Outstanding Number of Shares	20,000
Exercisable Number of Shares	20,000
Exercise Price Per Share $17.82
Stock-Based Compensation
Exercise Price Per Share (in dollars per share) | $ / shares	$ 17.82
Remaining Contractual Life	2 years 9 months
Outstanding Number of Shares	12,084
Exercisable Number of Shares	12,084
Exercise Price Per Share $34.00
Stock-Based Compensation
Exercise Price Per Share (in dollars per share) | $ / shares	$ 34
Remaining Contractual Life	3 years 6 months
Outstanding Number of Shares	12,400
Exercisable Number of Shares	12,400
Exercise Price Per Share $40.26
Stock-Based Compensation
Exercise Price Per Share (in dollars per share) | $ / shares	$ 40.26
Remaining Contractual Life	4 years 5 months 1 day
Outstanding Number of Shares	19,667
Exercisable Number of Shares	19,667
Exercise Price Per Share $55.88
Stock-Based Compensation
Exercise Price Per Share (in dollars per share) | $ / shares	$ 55.88
Remaining Contractual Life	5 years 5 months 1 day
Outstanding Number of Shares	19,700
Exercisable Number of Shares	19,700
Exercise Price Per Share $47.96
Stock-Based Compensation
Exercise Price Per Share (in dollars per share) | $ / shares	$ 47.96
Remaining Contractual Life	6 years 5 months 1 day
Outstanding Number of Shares	35,600
Exercisable Number of Shares	35,600
Exercise Price Per Share $48.39
Stock-Based Compensation
Exercise Price Per Share (in dollars per share) | $ / shares	$ 48.39
Remaining Contractual Life	6 years 5 months 1 day
Outstanding Number of Shares	1,800
Exercisable Number of Shares	1,800
Exercise Price Per Share $52.78
Stock-Based Compensation
Exercise Price Per Share (in dollars per share) | $ / shares	$ 52.78
Remaining Contractual Life	7 years 5 months 1 day
Outstanding Number of Shares	45,250
Exercisable Number of Shares	30,168
Exercise Price Per Share $46.72
Stock-Based Compensation
Exercise Price Per Share (in dollars per share) | $ / shares	$ 46.72
Remaining Contractual Life	8 years 5 months 1 day
Outstanding Number of Shares	81,100
Exercisable Number of Shares	27,034
Exercise Price Per Share $37.75
Stock-Based Compensation
Exercise Price Per Share (in dollars per share) | $ / shares	$ 37.75
Remaining Contractual Life	9 years 5 months 1 day
Outstanding Number of Shares	79,800

Stock-Based Compensation - 2016

Stock-Based Compensation - 2016 Incentive Compensation Plan (Details) - 2016 Incentive Compensation Plan	Mar. 01, 2016shares
Restricted Stock, Restricted Stock Units and Performance Shares
Information relating to stock options
Number of shares authorized	275,000
Stock Options and Stock Appreciation Rights
Information relating to stock options
Number of shares authorized	425,000

Dividend (Details)

Dividend (Details) - USD ($) $ / shares in Units, $ in Thousands	Aug. 04, 2016	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Common stock dividend
Dividend declared (in dollars per share)	$ 0.22	$ 0.22	$ 0.22	$ 0.66	$ 0.66
Dividend paid (in dollars per share)		$ 0.22
Dividend paid (in dollars)		$ 2,748		$ 8,240	$ 8,214

Fair Value Measurements (Detail

Fair Value Measurements (Details) - USD ($) $ in Thousands	Jun. 30, 2016	Sep. 30, 2015
Fair value measurements on recurring basis | Level 1
Assets:
Cash and cash equivalents	$ 44,418	$ 49,045

Changes in Accumulated Other 53

Changes in Accumulated Other Comprehensive Income (Loss) by Component (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Accumulated other comprehensive income (loss)
Balance			$ 341,989
Net current-period other comprehensive income (loss)	$ (1,769)	$ 4,636	17	$ 1,898
Balance	336,928		336,928
AOCI Attributable to Parent
Accumulated other comprehensive income (loss)
Balance	(86,167)	(64,566)	(87,953)	(61,828)
Other comprehensive income (loss) before classifications	(3,745)	3,381	(5,911)	(1,864)
Amounts reclassified from accumulated other comprehensive income (loss), Tax benefit	1,151	737	3,450	2,214
Net current-period other comprehensive income (loss)	(1,769)	4,636	17	1,898
Balance	(87,936)	(59,930)	(87,936)	(59,930)
Defined Benefit Plans | Defined Benefit Pension Plans
Accumulated other comprehensive income (loss)
Balance	(59,926)	(41,058)	(62,985)	(42,800)
Amounts reclassified from accumulated other comprehensive income (loss), Tax benefit	891	513	2,671	1,538
Net current-period other comprehensive income (loss)	1,529	871	4,588	2,613
Balance	(58,397)	(40,187)	(58,397)	(40,187)
Defined Benefit Plans | Postretirement Health Care Benefits
Accumulated other comprehensive income (loss)
Balance	(20,880)	(19,235)	(21,773)	(20,000)
Amounts reclassified from accumulated other comprehensive income (loss), Tax benefit	260	224	779	676
Net current-period other comprehensive income (loss)	447	384	1,340	1,149
Balance	(20,433)	(18,851)	(20,433)	(18,851)
Amortization of Pension and Postretirement Plan items
Accumulated other comprehensive income (loss)
Amounts reclassified from accumulated other comprehensive income (loss), before tax	(202)	(202)	(606)	(606)
Amortization of Pension and Postretirement Plan items | Defined Benefit Pension Plans
Accumulated other comprehensive income (loss)
Amounts reclassified from accumulated other comprehensive income (loss), before tax	(202)	(202)	(606)	(606)
Actuarial losses
Accumulated other comprehensive income (loss)
Amounts reclassified from accumulated other comprehensive income (loss), before tax	(2,925)	(1,790)	(8,772)	(5,370)
Actuarial losses | Defined Benefit Pension Plans
Accumulated other comprehensive income (loss)
Amounts reclassified from accumulated other comprehensive income (loss), before tax	(2,218)	(1,182)	(6,653)	(3,545)
Actuarial losses | Postretirement Health Care Benefits
Accumulated other comprehensive income (loss)
Amounts reclassified from accumulated other comprehensive income (loss), before tax	(707)	(608)	(2,119)	(1,825)
Foreign Exchange
Accumulated other comprehensive income (loss)
Balance	(5,361)	(4,273)	(3,195)	972
Other comprehensive income (loss) before classifications	(3,745)	3,381	(5,911)	(1,864)
Net current-period other comprehensive income (loss)	(3,745)	3,381	(5,911)	(1,864)
Balance	$ (9,106)	$ (892)	$ (9,106)	$ (892)

Acquisition (Details)

Acquisition (Details) - USD ($) $ in Thousands	Jan. 07, 2015	Jun. 30, 2016	Sep. 30, 2015
Purchase Price Allocation
Goodwill		$ 4,789	$ 4,789
Leveltek Processing, LLC
Acquisition
Acquisition price	$ 14,600
Purchase Price Allocation
Property, plant and equipment, net	7,563
Customer relationships	2,100
Inventory	148
Total identifiable net assets	9,811
Goodwill	4,789
Total purchase price	14,600
Customer relationships | Leveltek Processing, LLC
Purchase Price Allocation
Customer relationships	$ 2,100

Capital Lease Obligation (Detai

Capital Lease Obligation (Details) - USD ($) $ in Thousands	Jan. 01, 2015	Jun. 30, 2016	Sep. 30, 2015
Leases, Capital [Abstract]
Lease Term	20 years
Capital Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract]
2016 (remainder of fiscal year)		$ 89
2,017		534
2,018		538
2,019		545
2,020		550
Thereafter		8,100
Total minimum capital lease payments		10,356
Less amounts representing interest		(6,012)
Present value of net minimum capital lease payments		4,344	$ 4,380
Less current obligation		(431)
Total long term capital lease obligation		3,913
Long-term obligations (less current portion)
Future capital lease rental payments		4,344	4,380
Environmental post-closure monitoring and maintenance activities		749	749
Less amounts due within one year		(518)	(555)
Long-term obligations (less current portion)		$ 4,575	$ 4,574

Restricted Cash (Details)

Restricted Cash (Details) - USD ($) $ in Thousands	1 Months Ended	9 Months Ended
	Jul. 31, 2016	Jun. 30, 2016
Restricted Cash
Advance payments received		$ 16,069
Restricted cash		$ 9,200
Restricted cash that became unrestricted during the period	$ 2,481

Expansion of LaPorte, Indiana57

Expansion of LaPorte, Indiana Operations (Details) - Expansion of LaPorte, Indiana Operations $ in Thousands	3 Months Ended
	Jun. 30, 2016USD ($)
Costs associated with project
Costs expensed in current period	$ 340
Minimum
Costs associated with project
Estimated costs	2,300
Minimum | Equipment relocation
Costs associated with project
Estimated costs	1,800
Minimum | Other costs
Costs associated with project
Estimated costs	500
Maximum
Costs associated with project
Estimated costs	3,600
Maximum | Equipment relocation
Costs associated with project
Estimated costs	2,500
Maximum | Other costs
Costs associated with project
Estimated costs	$ 1,100