Exhibit 99.1
Allegheny Technologies Announces Strong Second Quarter 2005 Results
PITTSBURGH--(BUSINESS WIRE)--July 27, 2005--Allegheny Technologies
Incorporated (NYSE:ATI):
-- Record sales of $904.2 million
-- Net income of $91.7 million, or $0.91 per share
-- Operating profit increased to $142 million, or 15.7% of sales
-- Segment operating margins as a percentage of sales:
-- Flat-Rolled Products 10.6%
-- High Performance Metals 25.4%
-- Engineered Products 11.7%
-- Cash flow from operations of $64.5 million for the quarter
-- Net debt to total capitalization improved to 34.3%
-- Cash on hand increased to $253 million
Allegheny Technologies Incorporated (NYSE:ATI) reported net income
for the second quarter 2005 of $91.7 million, or $0.91 per share, on
sales of $904.2 million.
In the second quarter 2004, ATI reported net income of $26.6
million, or $0.31 per share, on sales of $646.5 million.
Net income for the six months ended June 30, 2005, was $152.7
million, or $1.53 per share, on sales of $1,783.8 million, compared to
a net loss of $23.8 million, or $(0.30) per share, on sales of
$1,224.3 million for the first six months of 2004.
"Second quarter results are another milestone that demonstrates
the earnings potential of the transformed Allegheny Technologies. ATI
revenue and operating profit reached all-time highs. Cash flow from
operations was nearly $65 million even after further investments of
over $100 million in managed working capital," said L. Patrick Hassey,
Chairman, President and Chief Executive Officer of Allegheny
Technologies.
"Robust demand from the early stage recovery of the commercial
aerospace market and another strong quarter from our exotic alloys
business drove the High Performance Metals segment sales and operating
profit to record levels. Our High Performance Metals segment operating
margins exceeded 25% of sales.
"Operating margins in our Flat-Rolled Products segment improved to
nearly 11% of sales. Our high-value flat-rolled product mix was
particularly strong due to demand for our flat-rolled nickel-based
alloys, specialty steels, and titanium products from the oil and gas,
electrical energy, aerospace, and chemical processing markets. Total
flat-rolled shipments were less than the first quarter 2005 due to
ongoing service center inventory reductions for certain stainless
products.
"Sales in our Engineered Products segment also reached record
levels due to strong demand from the oil and gas, automotive, mining,
and aerospace markets. Sales were aided by our April 2005 asset
acquisition of Garryson Limited in the U.K. Segment operating margins
were just under 12%.
"We remain confident about the prospects for ATI and continue to
build a foundation for further growth. As an example, sales of our
nickel-based alloys, titanium alloys, exotic alloys, and high-value
specialty steels reached 40% of ATI's sales during the first half
2005, compared to 35% of sales during the first half 2004. This
represents an increase of $275 million in sales.
"We believe our second half 2005 earnings performance will be
similar to the first half 2005 earnings performance."
Following on, Hassey said, "Demand for our High Performance Metals
products is expected to remain robust. Demand for our Engineered
Products is expected to remain very good. Overall, third quarter 2005
earnings are likely to be lower than the fourth quarter 2005 due
primarily to normal seasonal slowing in the Flat-Rolled Products
segment. We expect to see reduced shipments of stainless commodity
products through most of the third quarter 2005 from continuing
inventory management actions throughout the supply chain. We are
taking action in our flat-rolled products business to reduce inventory
and are encouraged by published reports that many global stainless
steel producers also are adjusting their production to market demand.
Cash flow from operations during the second half 2005 is expected to
be very strong as earnings are no longer anticipated to be offset by
considerable investments in managed working capital."
Three Months Ended Six Months Ended
June 30 June 30
In Millions
--------------------------------------
2005 2004 2005 2004
--------- -------- --------- ---------
Sales $904.2 $646.5 $1,783.8 $1,224.3
Net income (loss) excluding
special gain $91.7 $(13.8) $152.7 $(64.2)
Special gain, net(a) - $40.4 - $40.4
Net income (loss) $91.7 $26.6 $152.7 $(23.8)
Per Diluted Share Per Diluted Share
Net income (loss) excluding
special gain $0.91 $(0.17) $1.53 $(0.78)
Special gain, net(a) - $0.48 - $0.48
Net income (loss) $0.91 $0.31 $1.53 $(0.30)
(a) Second quarter 2004 special gain, net was related to actions taken
to control certain salaried retiree medical costs, net of costs
associated with Allegheny Ludlum's new labor agreement and the J&L
asset acquisition.
Second Quarter 2005 Financial Highlights
-- Sales were $904.2 million, 40% higher than the second quarter
2004. Sales increased 32% in the Flat-Rolled Products segment,
57% in the High Performance Metals segment, and 35% in the
Engineered Products segment.
-- Segment operating profit was $141.8 million, an increase of
$103.7 million compared to the second quarter 2004, as a
result of improved performance across all three business
segments. Second quarter 2005 results included a LIFO
inventory valuation reserve charge of $26.3 million, due
primarily to higher titanium scrap and tungsten raw material
costs. The LIFO inventory valuation reserve charge was $26.1
million in the second quarter 2004.
-- Net income was $91.7 million, or $0.91 per share.
-- Cash flow from operations was $59.8 million in the first half
2005 as significantly higher operating results more than
offset the further investment of $222.5 million in managed
working capital resulting from improved market conditions.
-- Cash on hand was $253.2 million at June 30, 2005.
-- Cost reductions, before the effects of inflation, totaled
$37.0 million company-wide in the second quarter and $67.1
million for the first half of 2005. Our 2005 cost reduction
goal is $100 million.
Flat-Rolled Products Segment
Market Conditions
-- Demand was strong for nickel-based alloys, specialty steels,
and titanium products from the oil and gas, electrical energy,
aerospace, and chemical processing markets. Inventory
management actions at service centers and in the supply chain
resulted in reduced shipments for stainless sheet and
engineered strip.
Second quarter 2005 compared to second quarter 2004
-- Sales increased 32% to $501.8 million primarily due to
improved demand, higher base-selling prices, higher raw
material surcharges, and higher shipments including those from
the facilities acquired in June 2004. Total finished tons
shipped increased by 14,360 tons, or 11%. Shipments of
commodity products increased 18% while shipments of high-value
products decreased 6%, primarily due to lower shipments of
stainless engineered strip products, which offset strong
shipments of nickel-based alloys, specialty steels, and
titanium products. Average transaction prices, which include
surcharges, were 12% higher for commodity products and 42%
higher for high-value products.
-- Segment operating income was $53.4 million, an increase of
$33.4 million, primarily as a result of increased shipments,
higher base-selling prices, additional surcharges, lower LIFO
valuation reserve charges, and the benefits of gross cost
reductions. Second quarter 2005 results had a LIFO inventory
valuation reserve charge of $3.9 million compared to a $15.2
million charge for the 2004 second quarter.
-- Results benefited from $26.6 million in gross cost reductions,
before the effects of inflation.
High Performance Metals Segment
Market Conditions
-- Demand for our titanium alloys, nickel-based superalloys, and
vacuum-melted specialty steels remained strong from the
aerospace, biomedical, and power generation markets. Our
exotic alloys business continued to benefit from sustained
high demand from government and medical markets, and from
corrosion markets particularly in Asia.
Second quarter 2005 compared to second quarter 2004
-- Sales increased 57% to $301.6 million. Shipments increased 11%
for titanium alloys, 14% for nickel-based and specialty steel
alloys, and 7% for exotic alloys. Average selling prices
increased 85% for titanium alloys, and 39% for nickel-based
and specialty steel alloys, but declined 7% for exotic alloys
primarily due to product mix.
-- Operating profit was $76.6 million, an increase of $64.0
million, as a result of increased shipments for most products,
higher selling prices, and the benefits of gross cost
reductions. Raw material cost inflation and higher inventory
levels resulted in a LIFO inventory valuation reserve charge
of $17.3 million in the second quarter 2005 compared to a $6.1
million charge in same 2004 period.
-- Results benefited from $8.9 million of gross cost reductions,
before the effects of inflation.
Engineered Products Segment
Market Conditions
-- Demand for our tungsten products was strong from the oil and
gas, automotive, mining, and aerospace markets. Demand
remained strong for our forged products from the Class 8
truck, and construction and mining markets. Demand for our
cast products was strong from the transportation, wind energy,
and oil and gas markets.
Second quarter 2005 compared to second quarter 2004
-- Sales improved 35% to $100.8 million due to higher selling
prices and increased volume, including shipments from our
U.K.-based ATI Garryson Limited cutting tool operations
acquired in April.
-- Operating profit improved to $11.8 million, a $6.3 million
increase, due to higher sales volumes, improved pricing, and
the benefits of gross cost reductions. Changes in raw material
costs and inventory levels resulted in a LIFO inventory
valuation reserve charge of $5.1 million in 2005 compared to a
$4.8 million charge in 2004.
-- Results benefited from $1.5 million of cost reductions, before
the effects of inflation.
-- As previously announced, on April 5, 2005 our ATI Metalworking
Products operation acquired the assets of U.K.-based Garryson
Limited, a leading producer of tungsten carbide burrs, rotary
tooling, and specialty abrasive wheels and discs, for
approximately $18 million in cash. Garryson had sales of over
$30 million in 2004. Since the acquisition was accounted for
as a purchase, second quarter results did not include
operating profit on sales of the purchased Garryson inventory.
Retirement Benefit Expense
-- Retirement benefit expense declined to $20.0 million in the
second quarter 2005 compared to $34.0 million in the second
quarter 2004, primarily as a result of actions taken in the
second quarter 2004 to control retiree medical costs and the
favorable effect of the Medicare prescription drug
legislation.
-- For the second quarter 2005, retirement benefit expense
included in cost of sales was $14.1 million, and in selling
and administrative expenses was $5.9 million. For the second
quarter 2004, retirement benefit expense included in cost of
sales was $25.3 million, and in selling and administrative
expenses was $8.7 million.
Other Expenses
-- Corporate expenses for the second quarter 2005 were $11.6
million compared to $8.9 million in the year-ago period. This
increase is due primarily to expenses associated with
performance-based incentive compensation programs.
-- Excluding the effects of retirement benefit expense, selling
and administrative expenses as a percentage of sales was 6.6%
in the second quarter 2005 compared to 7.6% in the same 2004
period.
-- Second quarter 2005 interest expense, net of interest income,
increased to $10.6 million from $7.8 million in the year-ago
period primarily related to interest associated with the
financing of the June 2004 J&L asset acquisition and higher
short-term interest rates.
Income Taxes
2005 results include a provision for income taxes of $3.0 million,
which is principally related to foreign and state income taxes. No
income tax provision or benefit was recognized in 2004. We maintain a
valuation allowance for a major portion of our deferred tax assets in
accordance with SFAS No. 109, "Accounting for Income Taxes". Future
tax provisions or benefits will be recognized when taxable income
exceeds net operating tax loss carry-forwards resulting in cash tax
payments, or when tax losses, if any, are recoverable as cash refunds,
or due to changes in our judgment regarding the realizability of our
deferred tax assets.
Cash Flow, Working Capital and Debt
-- Cash on hand was $253.2 million at June 30, 2005.
-- Cash flow from operations during the 2005 first half was $59.8
million as the significant improvement in operating earnings
was partially offset by a $222.5 million investment in managed
working capital.
-- The investment in managed working capital resulted from a
$74.5 million increase in accounts receivable, which reflects
the significantly higher level of sales in the second quarter
2005 compared to the fourth quarter 2004, and a $149.7 million
increase in inventory mostly as a result of higher raw
material costs and increased business volumes, partially
offset by a $1.7 million increase in accounts payable. Most of
the increase in raw material costs is expected to be recovered
through surcharge and index pricing mechanisms.
-- At June 30, 2005, managed working capital was 30.1% of
annualized sales compared to 29.5% of annualized sales at
year-end 2004. We define managed working capital as accounts
receivable and gross inventories less accounts payable.
-- Cash used in investing activities was $38.7 million in the
2005 first half and consisted primarily of capital
expenditures of $19.8 million and $17.7 million for the
acquisition of Garryson Limited.
-- Cash used in financing activities was $18.7 million in the
2005 first half and included a decrease in net borrowings of
$13.5 million and payment of dividends of $11.5 million, which
were partially offset by $6.3 million of proceeds received
from the exercise of stock options.
-- Net debt as a percentage of total capitalization improved to
34.3% at June 30, 2005 from 43.8% at the end of 2004.
-- There were no borrowings outstanding during 2005 or 2004 under
ATI's $325 million secured domestic borrowing facility,
although a portion of the letters of credit capacity was
utilized.
New Accounting Pronouncement Adopted in 2005
In the first quarter 2005, the Company adopted Statement of
Financial Accounting Standards No. 123R, "Share-Based Payment". Under
the revised standard, companies may no longer account for share-based
compensation transactions, such as stock options, restricted stock,
and potential payments under programs such as our Total Shareholder
Return plans, using the intrinsic value method as defined in APB
Opinion No. 25. Instead, companies are required to account for such
equity transactions using an approach in which the fair value of an
award is estimated at the date of grant and recognized as an expense
over the requisite service period. Compensation expense is adjusted
for equity awards that do not vest because service or performance
conditions are not satisfied. However, compensation expense already
recognized is not adjusted if market conditions are not met, such as
stock options expiring "out-of-the-money". We adopted the new standard
using the modified prospective method and, beginning with the first
quarter 2005, reflect compensation expense in accordance with the SFAS
123R transition provisions. Under the modified prospective method, the
effect of the standard is recognized in the period of adoption and in
future periods. Prior periods are not restated to reflect the impact
of adopting the new standard at earlier dates.
Second quarter 2005 compensation expense related to share-based
incentive plans was $2.5 million compared to $8.9 million in the
second quarter 2004. Second quarter 2005 share-based compensation
expense includes $0.8 million related to expensing of stock options.
Allegheny Technologies will conduct a conference call with
investors and analysts on July 27, 2005, at 1 p.m. ET to discuss the
financial results. The conference call will be broadcast live on
www.alleghenytechnologies.com. To access the broadcast, click on
"Conference Call". In addition, the conference call will be available
through the CCBN website, located at www.ccbn.com.
This news release contains "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995.
Certain statements in this news release relate to future events and
expectations and, as such, constitute forward-looking statements.
Forward-looking statements include those containing such words as
"anticipates," "believes," "estimates," "expects," "would," "should,"
"will," "will likely result," "forecast," "outlook," "projects," and
similar expressions. Forward-looking statements are based on
management's current expectations and include known and unknown risks,
uncertainties and other factors, many of which we are unable to
predict or control, that may cause our actual results, performance or
achievements to materially differ from those expressed or implied in
the forward-looking statements. Important factors that could cause
actual results to differ materially from those in the forward-looking
statements include: (a) material adverse changes in economic or
industry conditions generally, including global supply and demand
conditions and prices for our specialty materials; (b) material
adverse changes in the markets we serve, including the commercial
aerospace, construction and mining, automotive, electrical energy,
chemical process industry and oil and gas, government, and other
markets; (c) our inability to achieve the level of cost savings,
productivity improvements, synergies, growth or other benefits
anticipated by management, including those anticipated from the
integration of acquired businesses, whether due to significant
increases in energy, raw materials or employee benefits costs or other
factors; (d) volatility of prices and availability of supply of the
raw materials that are critical to the manufacture of our products;
(e) declines in the value of our defined benefit pension plan assets
or unfavorable changes in laws or regulations that govern pension plan
funding; (f) significant legal proceedings or investigations adverse
to us; and (g) the other risk factors summarized in our Annual Report
on Form 10-K for the year ended December 31, 2004, and other reports
filed with the Securities and Exchange Commission. We assume no duty
to update our forward-looking statements.
Allegheny Technologies Incorporated is one of the largest and most
diversified specialty materials producers in the world with revenues
of approximately $2.7 billion in 2004. ATI has approximately 9,000
full-time employees world-wide who use innovative technologies to
offer growing global markets a wide range of specialty materials
solutions. Our principle markets are aerospace, construction and
mining, chemical processing/oil & gas, food equipment and appliance,
automotive, electrical energy, machine and cutting tools, and medical.
Our products include nickel-based alloys and superalloys, titanium and
titanium alloys, stainless and specialty steels, zirconium, hafnium,
and niobium, tungsten materials, silicon and tool steels, and forgings
and castings. The Allegheny Technologies website is
www.alleghenytechnologies.com.
Allegheny Technologies Incorporated and Subsidiaries
Consolidated Statements of Operations
(Unaudited - Dollars in millions, except per share amounts)
Three Months Six Months
Ended Ended
June 30 June 30
--------------- -------------------
2005 2004 2005 2004
------- ------- --------- ---------
Sales $904.2 $646.5 $1,783.8 $1,224.3
Costs and expenses:
Cost of sales 732.5 593.9 1,470.8 1,161.3
Selling and administrative
expenses 65.4 57.8 132.2 111.5
Curtailment gain, net of
restructuring costs - (40.4) - (40.4)
------- ------- --------- ---------
Income (loss) before interest,
other income (expense) and income
taxes 106.3 35.2 180.8 (8.1)
Interest expense, net (10.6) (7.8) (21.0) (16.0)
Other income (expense), net (1.0) (0.8) (1.8) 0.3
------- ------- --------- ---------
Income (loss) before income tax
provision 94.7 26.6 158.0 (23.8)
Income tax provision 3.0 - 5.3 -
------- ------- --------- ---------
Net income (loss) $91.7 $26.6 $152.7 $(23.8)
======= ======= ========= =========
Basic net income (loss) per common
share $0.96 $0.33 $1.60 $(0.30)
======= ======= ========= =========
Diluted net income (loss) per
common share $0.91 $0.31 $1.53 $(0.30)
======= ======= ========= =========
Weighted average common shares
outstanding -- basic (millions) 95.8 80.6 95.6 80.5
Weighted average common shares
outstanding -- diluted (millions) 100.3 84.6 100.1 80.5
Actual common shares outstanding--
end of period (millions) 96.5 81.4 96.5 81.4
Allegheny Technologies Incorporated and Subsidiaries
Sales and Operating Profit by Business Segment
(Unaudited - Dollars in millions)
Three Months Six Months
Ended Ended
June 30 June 30
--------------- -------------------
2005 2004 2005 2004
------- ------- --------- ---------
Sales:
Flat-Rolled Products $501.8 $379.2 $1,026.7 $708.8
High Performance Metals 301.6 192.5 564.3 371.2
Engineered Products 100.8 74.8 192.8 144.3
------- ------- --------- ---------
Total External Sales $904.2 $646.5 $1,783.8 $1,224.3
======= ======= ========= =========
Operating Profit:
Flat-Rolled Products $53.4 $20.0 $92.6 $9.0
% of Sales 10.6% 5.3% 9.0% 1.3%
High Performance Metals 76.6 12.6 140.1 20.4
% of Sales 25.4% 6.5% 24.8% 5.5%
Engineered Products 11.8 5.5 23.0 9.3
% of Sales 11.7% 7.4% 11.9% 6.4%
------- ------- --------- ---------
Operating Profit 141.8 38.1 255.7 38.7
% of Sales 15.7% 5.9% 14.3% 3.2%
Corporate expenses (11.6) (8.9) (21.9) (14.5)
Interest expense, net (10.6) (7.8) (21.0) (16.0)
------- ------- --------- ---------
Subtotal 119.6 21.4 212.8 8.2
Curtailment gain, net of
restructuring costs - 40.4 - 40.4
Other expenses, net of gains
on asset sales (4.9) (1.2) (14.6) (2.4)
Retirement benefit expense (20.0) (34.0) (40.2) (70.0)
------- ------- --------- ---------
Income (loss) before
income taxes $94.7 $26.6 $158.0 $(23.8)
======= ======= ========= =========
Allegheny Technologies Incorporated and Subsidiaries
Consolidated Balance Sheets
(Current period unaudited--Dollars in millions)
June 30, December 31,
2005 2004
------------ ------------
ASSETS
Current Assets:
Cash and cash equivalents $253.2 $250.8
Accounts receivable, net of allowances for
doubtful accounts of $8.7 and $8.4 at
June 30, 2005 and December 31, 2004,
respectively 435.4 357.9
Inventories, net 628.7 513.0
Prepaid expenses and
other current assets 34.6 38.5
------------ ------------
Total current assets 1,351.9 1,160.2
Property, plant and equipment, net 701.4 718.3
Cost in excess of net assets acquired 203.9 205.3
Deferred pension asset 122.3 122.3
Deferred income taxes 61.6 53.0
Other assets 64.2 56.6
------------ ------------
Total Assets $2,505.3 $2,315.7
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable $277.0 $271.2
Accrued liabilities 203.6 192.2
Short term debt and current portion of
long-term debt 20.2 29.4
------------ ------------
Total current liabilities 500.8 492.8
Long-term debt 548.1 553.3
Accrued postretirement benefits 468.9 472.7
Pension liabilities 269.9 240.9
Other long-term liabilities 114.7 130.1
------------ ------------
Total liabilities 1,902.4 1,889.8
------------ ------------
Total stockholders' equity 602.9 425.9
------------ ------------
Total Liabilities and Stockholders' Equity $2,505.3 $2,315.7
============ ============
Allegheny Technologies Incorporated and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(Unaudited--Dollars in millions)
Six Months
Ended
June 30
---------------
2005 2004
------- -------
Operating Activities:
Net income (loss) $152.7 $(23.8)
Non-cash curtailment gain and restructuring
charges, net - (45.6)
Depreciation and amortization 37.0 37.9
Change in pension assets/liabilities 29.0 34.8
Change in managed working capital (222.5) (110.9)
Accrued liabilities and other 63.6 129.2
------- -------
Cash provided by operating activities 59.8 21.6
------- -------
Investing Activities:
Purchases of property, plant and equipment (19.8) (25.2)
Acquisition of business (17.7) (7.5)
Asset disposals and other (1.2) 1.0
------- -------
Cash used in investing activities (38.7) (31.7)
------- -------
Financing Activities:
Net decrease in debt (13.5) (3.2)
Dividends paid (11.5) (4.9)
Exercises of stock options 6.3 2.6
------- -------
Cash used in financing activities (18.7) (5.5)
------- -------
Increase (decrease) in cash and cash equivalents 2.4 (15.6)
Cash and cash equivalents at beginning of period 250.8 79.6
------- -------
Cash and cash equivalents at end of period $253.2 $64.0
======= =======
Allegheny Technologies Incorporated and Subsidiaries
Selected Financial Data
(Unaudited)
Three Months Ended Six Months Ended
June 30 June 30
------------------- -------------------
2005 2004 2005 2004
-------- -------- -------- --------
Volume:
Flat-Rolled Products
(finished tons) 148,118 133,758 320,905 258,745
-------- -------- -------- --------
Commodity 109,844 92,838 239,786 179,854
High value 38,274 40,920 81,119 78,891
High Performance Metals
(000's lbs.)
Nickel-based and
specialty steel alloys 9,866 8,644 20,215 17,588
Titanium mill products 6,304 5,656 12,441 10,679
Exotic alloys 1,155 1,082 2,182 2,267
Average Prices:
Flat-Rolled Products (per
finished ton) $ 3,383 $ 2,832 $ 3,193 $ 2,738
Commodity $ 2,444 $ 2,189 $ 2,390 $ 2,101
High value $ 6,077 $ 4,291 $ 5,566 $ 4,190
High Performance Metals
(per lb.)
Nickel-based and specialty
steel alloys $ 11.34 $ 8.15 $ 10.54 $ 7.94
Titanium mill products $ 20.72 $ 11.20 $ 19.07 $ 11.30
Exotic alloys $ 38.69 $ 41.41 $ 39.53 $ 38.75
Allegheny Technologies Incorporated and Subsidiaries
Other Financial Information
Managed Working Capital
(Unaudited - Dollars in millions)
June 30, December 31,
2005 2004
--------------- ---------------
Accounts receivable $435.4 $357.9
Inventory 628.7 513.0
Accounts payable (277.0) (271.2)
--------------- ---------------
Subtotal 787.1 599.7
Allowance for doubtful accounts 8.7 8.4
LIFO reserve 256.0 223.9
Corporate and other 30.9 20.6
--------------- ---------------
Managed working capital $1,082.7 $852.6
=============== ===============
Annualized prior 2 months
sales $3,591.9 $2,887.0
=============== ===============
Managed working capital as a
% of annualized sales 30.1% 29.5%
June 30, 2005 change in managed
working capital $230.1
Acquisition of managed working capital (7.6)
---------------
Net change in managed working capital $222.5
===============
As part of managing the liquidity in our business, we focus on
controlling managed working capital, which is defined as gross
accounts receivable and gross inventories, less accounts payable. In
measuring performance in controlling this managed working capital, we
exclude the effects of LIFO inventory valuation reserves, excess and
obsolete inventory reserves, and reserves for uncollectible accounts
receivable which, due to their nature, are managed separately.
Allegheny Technologies Incorporated and Subsidiaries
Other Financial Information
Net Debt to Capital
(Unaudited - Dollars in millions)
June 30, December 31,
2005 2004
------------ ------------
Total debt $568.3 $582.7
Less: Cash (253.2) (250.8)
------------ ------------
Net debt $315.1 $331.9
Net debt $315.1 $331.9
Stockholders' equity 602.9 425.9
------------ ------------
Total capital $918.0 $757.8
Net debt to capital ratio 34.3% 43.8%
============ ============
In managing the overall capital structure of the Company, one of the
measures on which we focus is net debt to total capitalization, which
is the percentage of debt to the total invested and borrowed capital
of the Company. In determining this measure, debt and total
capitalization are net of cash on hand which may be available to
reduce borrowings.
CONTACT: Allegheny Technologies Incorporated
Dan L. Greenfield, 412-394-3004