CRS - Earnings call transcript Q1 2025 | Carpenter Technology Corporation

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Operator

Good day, and welcome to the Carpenter Technology Fiscal First Quarter 2025 Earnings Conference Call. [Operator Instructions]. I would now like to turn the conference over to Mr. John Huyette. Please go ahead.

John Huyette

operator. you, Thank and Call everyone, September the Technology Carpenter XXXX. Good the welcome fiscal Conference for ended XXXX Earnings morning, to First XX, Quarter This Internet over being call presentation with slides. the is also along broadcast

Chief of and delay slide are Tim Vice time Tony Lain, those experience call and President and on in you you Senior movement. phone, For may Financial by Chief a Thene, the Speakers Officer. today listening Executive President Officer;

those are from statements on that based to earnings actual turn discusses found presentation year when noted, Please sales, excludes statements surcharge. recent Statements Risk company's the to filings. including unless items June will special that most that to When revenue, that current can XXXX, SEC made reference call excluding Technology's also by operating during management discussion, factors following the the forward-looking and surcharge. in Tony. ended XX, expectations. report management now that results this is are to attached I these be referring based could exhibits on margins, Form cause the on for and adjusted the filings, income, Carpenter differ in otherwise materially excluding the over or forward-looking sales note XX-K operating

Tony Thene

to our performance. safety Thank I you, morning X of review John, and call everyone today. the Slide on a good will begin with on

rate was direction. improvement first the This XXXX, quarter our For X.X. of incident fiscal a case the step total represents in right year

operations. them little with safety of number new integrated culture. large experience has been of of an years last elevated with our as into rate over we no engaged couple Our the or employees a many

on and training we a have our potential of invested minimizing risks During identifying for injuries. with programs severity this time, in employees the focus

in but culture, safety develop more safety-focused As are still improvement an our we and do. our we performance, in seeing gain have experience our employees to

work and we workplace, to invest continue goal. a will X to to is be achieve injury goal and that Our

to to turn up Slide full XXXX overview earnings X year a first of great quarter to an year start our with fiscal and for record first a step fiscal earnings Let's XXXX positive our performance. Obviously, guidance. quarter

first time able Specifically, the stabilizes rate to build of on acceleration growth year actions. earnings indicator in capacity to XXXX, achieve over capabilities improvement This result income, our XX% unique continued to the in is our million first This record produce operating adjusted is continued near generated product and of ramp profitable and only we $XXX supply in solid ability most that pricing aggressive of on embarks but our the during year record. market and quarter supply fiscal first an chain optimization mix a these uncertainty then fiscal are as is not XXXX quarter the the strong we in strong quarter testament position a in productivity, increase of a It of aerospace chain. aerospace execution, earnings the near-term term. record

up an free meaningful previous we with to increase adjusted The XX.X% segment cash delivering margin SEO $XX.X the focused year. margin lower XX.X%. generated SAO first evident in cash a operating expectations, is from were Further, of the are efforts to during income as with the within results million we sequential million quarter with flow productivity $XX.X the Notably, million able shipments. even operations. adjusted adjusted of from operating continues the of of $XXX.X quarter step exceed This operating in the

earnings announced repurchase the program, which million on of we shares million last repurchased call. addition, In as $XX during the our $XXX first part in quarter a was share

more detail performance year financial will presentation. XXXX fiscal strong goals, discuss our in our which sets I a Altogether, for in quarter the first foundation later

X expected, by the and take quarter Slide XX% maintenance planned sales sales with of to X% on at and as year earnings fiscal Aerospace year-over-year. and sequentially the In closer XXXX, the discussed turn last up first decreased first sequentially increased call. we a and as look end-use year-over-year. In market let's our Sales dynamics. sales sales the XX% our quarter Now roughly down the sequential outages decline and majority market, driven of Defense X% were were

and sales sales defense up Defense world demand Aerospace MRO pool on first roughly remains sales caught sequentially. were first and and in were best critical by as and XX%. events continue due to get best record, Within due sequentially Defense advanced our next robust strong see first ongoing to our flat sales work being for represented past demand Engine customers Aerospace quarter demand. on Defense, over solutions. up quarter our strong quarter to continue to engine

expectations submarkets and quarter. capacity earlier. The mentioned represent strong our I the down very other sequentially, aerospace were our Altogether, with reflecting another available line and largely as manufacturing quarter, defense shipments in in ended aerospace

indicated strong due as in market end-use up outlook sales were lower market, sales. partly sequential XX% medical XX% The demand we patient the for our sequentially grow, total revenue our growth markets grow remains by two and to rates is year-over-year. quarter. growth. in defense, and overall in of the continue Patient demand and approximately to shipments overall sales at positive. and above to our have aerospace market operating share of with medical, by to Together Moving end-use down very backlogs driven the continue in year-over-year XX% And decrease fewer realized well days

a are Florida. also We some hurricane facility in coming due And delayed our comparison. Dynamet we quarter had shipments in for off sequential record the to

grow medical applications continue of with to market, solutions. how the our the material further emphasize desire We in in of daily as solutions are a to end-use our that are unique variety us our critical customers require reminded new

have power the increasing Looking were energy up that go by ability Notably, sequentially seen we and for shift at to materials, fundamentals. us market, sales into year-over-year, generation, margins. driven demand the ongoing demand X% and long-term XX% up end-use urgent support The high are positive similar in alloys applications these and materials aerospace the to giving our our production similar demand. to opportunistically carry

customers We are Altogether, slot markets our schedules. power with the and demand outlook opportunity production to to be key working remains demand continue to robust, continues in to end-use long-term our into underlying our identify our strong. generation

Now I for will summary. turn over to the Tim financial it

Timothy Lain

in combined Good morning, sales in increased was sales with volume. Tony. in down evident X, Thanks, income a quarter focus higher of capacity summary. driven XX% Slide as year. from the surcharge, were to our sales, most higher X% productivity, increased the excluding by our our reduction we our the profitable at profit. start which the to and last as in improving up current products year-over-year as Sequentially, X% ongoing continue net The on product year-over-year product $XXX.X everyone. I'll top, well million gross on is on in growth similar prices. mix productivity same quarter, Starting mix XX% shift the realization The volume. with statement improving the

$XX.X the line the totaled roughly expenses million recent the $X last were first when million SG&A excluding $X special year costs, $XX.X and up corporate Note, first in quarter, the which million down sequentially. the includes in SG&A from million quarter item. quarter same

XXXX. $XX of to current to expect quarter higher in be the $XX As first Operating million which the was fiscal cost $XXX.X approximately million per income, adjusted XXXX. we $XX the million last is year million said corporate than in of income million or quarter, fiscal for balance quarter operating we $XXX.X year XX% our of quarter

a As quarter operating income result. represents Tony mentioned first record earlier, this

expand and delivering XX.X% operating momentum margins, operating build We continue to of margin company current adjusted the quarter. total in

due benefits special quarters. of excluding in rate, same equity XX.X% tax year certain with the vesting effective effective was tax items, last our awards to to the rate which in quarter. on associated both The current Moving was comparable quarter to

Adjusted For asset our fiscal continue earnings operations. we of restructuring be per results actions year impact share XX% the the charges streamline earnings The additive exclude and $X.XX diluted rate was impairment to to share expect to associated adjusted per for effective of quarter. diluted in range the share XXXX, the tax per with to XX%.

the per earnings $X.XX for of aerospace share quarter industry. challenging execution of diluted the given results solid chain in in the summary, environment, the supply In a near-term operating adjusted demonstrates uncertainty

for surcharge and we the impact SAO million. the turning XX% a the sales Now year-over-year Slide realized comparison were mix solutions. our basis, using sales our higher to focus first reflects $XXX.X as our On up an portfolio for were and segment year-over-year quarter highest-margin product excluding Net of results. The capacity on X prices to on actively volume. flat improving manage

activities higher impacts sales anticipated, were across reflecting volume, planned sequentially had the to due days the offset of and equipment we by down lower fewer working prices. on of XX% operations As availability maintenance realization X%

first the results. quarter fiscal SAO operating reported to $XXX.X operating of year income in million XXXX. of Moving

of represented quarter mentioned, improvements have evident Tony to adjusted pricing product expectations operating for SAO. exceeded in As in increased in are results first XX.X% our operating period. has and areas the mix the record productivity, The and which the margin, we a current made

the Some additional context results. quarter's of current

the manage was team sales. our executing and operating customer unchanged profitable to products. enhancing demonstrates The from is focused last our the manage actively to remains to down reduction despite actively million team actions while manage maintain million quarters. priorities. production meaningful adjust team's a closely SAO increase most On This product further to focus we $X.X In income mix the increases maximize more even basis, environment, schedules current the realize costs efforts productivity. price a is relevant the further levels and on sequential consistent to in several production capacity SAO's and for The and $XX.X to focus remains as changing

will million. second Looking we to of XXXX, operating million SAO year fiscal income $XXX of to range upcoming in generate $XXX ahead the quarter our anticipate

in Now PEP surcharge income the turning in million reported first XXXX. ago down from and in XX% XXXX quarter $X.X flat sales, the the Net and million, and quarter fiscal of of a excluding of year PEP compared million sequentially. year to fourth were our year fiscal the $X.X current ago million quarter operating In same XX segment quarter year $XX.X a same $XX.X Slide to roughly the quarter, results.

of past, said represents as the sales significant Dynamet greater a is PEP percentage of segment, we the an in profitability. PEP's portion and Dynamet driver As the even PEP of

approximately focus SAO, which very to to in business the and market output. and in will With profitability compared fundamentals period type. the by for results increased same driven a recent our that XX% be to and last year. been use continue efforts which has have including medical end has of aerospace is sales. the not said, markets, in productivity to quarter our accounts only Those first at Dynamet to their backdrop improve comparable capacity The expand strong Dynamet improved in Dynamet are increase Dynamet working demand XX%

Technology deliver Carpenter XXXX, customers. we recently seen overall PEP Our quarter a of With additive in upcoming out has that to business, $X in although certain the operating million the from demand that segment million. year will anticipate fiscal strategic in push key range not the of income $X.X material of second mind, to currently

capital results the fiscal working and free In million last activities is The quarter flow Now delivering year. were disciplined $X.X The full towards generated current cash year driven our quarter the a turning of the generation to current important in target. and cash to review an flow. in by quarter, profitability compared step improving we adjusted cash same cash management. operating Slide XX from $XX.X million of

just For capital spent we under on million the $XX current expenditures. quarter,

those in quarter XXXX fiscal the flow details remains free Our XXXX. capital $XXX of at target With in year $XX.X year mind, adjusted fiscal million. cash first million we for of in reported spending

complements began quarterly $XX the year program. Beyond cash XXXX, repurchase fiscal share the the authorized we we purchased $XXX the million against authorization. program our executing In long-standing flow The allocation balanced to first dividend. and capital of repurchase share generated, reflects against shares quarter approach we of recently million the

credit of remains our year ended borrowings liquidity. and turn includes Finally, our the that, $XXX.X of healthy. $XXX.X total first million fiscal XXXX the With facility. call on Tony. We available million to quarter million That $XXX.X back I'll of cash with liquidity of

Tony Thene

Tim. Thanks,

year fiscal the to XXXX turn outlook. let's Now

fiscal a Day May we year in journey our double At last with impressive annual realizing fiscal remarkable to for expectations goal performance. exceed our out by XXXX there Investor represented a X-year actions. product XXXX opportunities laid fiscal have years. growth, expected to That year XX% productivity, optimizing from mix improving our XXXX. operating compounded been by over operating growth We Even rate on were such and pricing income year X the a XXXX, income path

to along, goal led of us that, many did accelerating pull As fiscal twice. XXXX. This growth year follow you our we just our in earnings through

achieve from can market and high current strong position believe uncertainty chain year team goal annual satisfied our XX% and million pulled XXXX. Then $XXX in the a rate we This continued million end After is to call, earnings start our period. FY $XXX compounded over the to a into to fiscal we at XXXX 'XX ahead execution, because growth April least our during supply our First, earnings years to this X-year capabilities. are a meeting the range. approximately The operating targets. income XXXX the aerospace goal And an year our annual in year profitability. with increased X another in FY now pulled XXXX, in now strong capacity year not July our following and 'XX. we goal over call, operating represents to guidance of growth of rate full year record report compounded XX% the just X We despite full unique again increasing of income of fiscal

is team expectations. exceeding focused Our on

and end, operating fiscal incremental that the XXXX the peak to million what higher, is ahead, XXXX that high-value sight even line pull mark. productivity could year for our we $XXX more earnings dynamics projections. as The industry current stronger strong expected with be The that end-use our above improving have aerospace now our end-use of to target same medical specialized income To we seen highly look driving fundamentals not the activity customers to of into of capacity performance the will growth to our our orders. working fiscal And unlock pushing market. They our current year include push than fly remains ever based to on get only are solutions the material are future. our across as people wanting and we've trends customers markets macro are to with in in before

through focused we are needs. to execution, surety market result, growth well our of We positioned solid their continue capabilities, to our long-term As our earnings supply that customers on a remain position the growth momentum. and strong our meet believe unique

Now slide to next let's the my turn comments. closing for

by outlook. company. delivered year summarize cash And free We of million our positive To a cash again was returning record We a against share Carpenter million our X-year new and Technology then all-time a $XXX me the $XXX beyond let our pulling we've over close, quarter. our Today, million to with quarter the high. X a executing We program, fiscal first in $XXX for increase the performance the in XX.X%, XX% began segment to $XXX go increased shareholders. repurchase to range to a SAO quarter, in a years, year flow ago, adjusted the a increased quarter after target first mark. record which our again, XXXX, first end guidance drive reaching just generated the margins for million top

All supply current of aerospace the this, uncertainties in despite near-term the chain.

in and address performance end-use Further, markets as Demand our we their our demonstrated across focused last to quarters. will our call to of will And We several to value the we believe early and we exceptional the continue growth we long-term performance. you as near-term deliver are the I turn operator. outlook with challenges over customers and we long-term execution as remain see strengthening. on journey, by continues Thank to our relationship growth capture back expand for drive accelerated improving your now the attention. we grow our growth stages to opportunities. and

Operator

Instructions]. [Operator

Khanna have with question TD line Cowen. the first from of We the Gautam

Gautam Khanna

seeing what's so, to are or Good deferral respect any some morning, requests? on -- -- guys. get And Tony, customers you if mentioned orders Just And I slowdown? are the I kind strike else from I'm to the aerospace destocking just everything color wanted your going with on at which curious backlogs record get then and that. incoming remain near in given you wanted on areas? to perspective highs. of your to you've product

Tony Thene

There's question. Yes. Good Thanks, Gautam. in couple there. a

kind So take one. me by let one of them

incoming sequentially, quarter I orders coming orders the were Obviously, booking specific of quarter. a quarter. say the we're First, last record down accelerated quarter. I to the for off want figures, don't towards the into they can't get although end but

point. -- I some that taking the -- you add bit So to of on with customers in today, it's going are we markets, strengthening offset the of high have those also a towards can very power heavily a we're approach, a market a when what's obviously, generation, Boeing. other orders that's wait-and-see comparing especially that big data specifically But been weighted very in see the AI end-use with from you centers. demand aerospace

is overall, backlog a remain extended. X mean, been I still billion that's times So lead the positive and offset. products key above still

backlog strong but intakes order uncertainty today, So order seems in the healthy market aerospace very well. some certainly, coming have and there's a we the as in

So order your intake and backlog your that question. covers

was build I one I system. think that right perfect chain. about by said I obviously, you think do in had don't into the that type saying see you or now? are reacting really throughout an supply the the any inventory such can have deferrals And of question how visibility we we extensive customers inventory And address

And doesn't certainly, chain smoothly. the supply operate always

requests well there's to As can building demand, What know, with high so a you to and continue materials. we more I MRO though, been is, it as relates then customers this emergency first, always from debuilding. for see level of say, of confidence

can more offset the very as an what So give OEM maybe you see an to you strong. And so that remains example. on I side.

majority OEM being can manufacturing take line phone down a of is likely, behind. the strong with for is demand area that our people this still line our couple adjust them of sense the a discussing support in we for days need down and Just them, on needed are how urgent that a of to ago, particular production and we're plans more

I this will but again, technology, say for supply I the in for be are know, of to overall, we're strongly mean chain now, we've term. outcome different that you work specific right through very navigate it's and to us have got uncertainty period that are well I to people as a certainly, right? going able going mean, a near different our for concentrated to carpet of not the and capabilities services So with of much breadth more over believe we everybody customer of because

Gautam Khanna

we guys feel if still kind more you if willing hey, prior you're backlogs Because caught follow-up, we do mentioned demand? but a of you like have feel have the underlying extended, cushion Has you that are product. kind of with you to as case? like throughput, are would the ship up do And in Or more mentioned, you've customers that quarters, evaporated? could we take more is still --

Tony Thene

areas I large to in you example to Thanks, exposure Gautam. wait-and-see percent kind up have high we to aerospace gave more other specific backlog. customers an customer. to we are specific. But have Carpenter have mean has Again, approach this it's still Technology of the that earlier dedicated they're other customers referencing other customers that the of very moving they that forward. That's supply that customer trying their and catch taking portfolio Absolutely. really I a a have if with one chain Are advantage

we production Obviously, do forward in now so. forward opportunity to trying exactly have what's uncertainty this move with in because people Boeing, we certainly, we're some schedule of that it's are in schedule them the the same is supply everybody know giving and those the in situation. that And our still to to chain pull production And the able inside to not backlog.

Operator

Benchmark with Sullivan The The comes from next question Company. Josh

Joshua Sullivan

market at on changes touch seasonality you're of how do what, you point. incremental some historical some a the we year-over-year think Historically, the think quarter, particularly we're metrics, up, we or -- to do the current but want versus when looking just that seasonality XX% conditions, of QX at of reason this and of how others? margins I report there's underlying this

Tony Thene

with Well, we hope in can't sold-out you it the are Josh. doesn't is a mean, makes in have some behind uncertainty those to rely the near it in it I term. It on tough effectively this we of norms that makes situation, tough, anymore. it, today us model. when that even historical market we

are sequential quarter, you the you to that's So earnings solid quarter-over-quarter operate. between number why days real maintenance moving. talk us about you've about right? the think difference engine keep when of or this only the really, proactive that heard quarters planned And

line those really So the is maintenance the bottom the is duration the quarters. planned preventative and determining events of between factor timing

factor we determining another increase Obviously, productivity. is to continue our

a inside the the to in roll that continue But we're we're mix. of folks trying now maximize product in you where that talk contracts to pushes New optimize higher. period our to plants, and output

going no because flag. a be reason good maintenance every quarter, because there's in So mean, for to I we It's right days the in sequential in maybe took decrease place red had quarter to or quarter. we certainly, less slight now? a a more you distinction quarter, just And have significant be. just that's and between that really quarter It's operating planned is that only them a

Joshua Sullivan

industry, are still given need a point? just what growth. your there's then crosscurrents this increasing and are the some I And thoughts the or capacity of in long-term what the mean, conversations at capacity around for

Tony Thene

at looking areas, the reasons of those see, able always we're of to X right? have you Well, again, been continue we productivity. drive to why There's areas big growth, earnings mean, one one is and I if that.

ability prime past, so our it in Josh, for and So facilities, us better. hidden A -- visited mean, very talked you're obviously, aware. our to always I the always we've our factory. there's example, There's is you we in I capacity think, get believe belief about and

safely in it's on a high That's massive quality, if If massive can you impact. daily impact that profitability. find mean look you primary a to ways increase at production. and milting, a I

last X So keenly And to that the out seen floor they're over moving forward. motivated and X shop area an on focused or quarters very our what great folks are making is keep on and you've that's the strides. that

job deal, more at to what once capacity. our said is Now a is look to to this the do than looking increase I've that can those. So productivity internally increase we're to organically through right? those. we I is continue at big externally And It's ability secondly capacity think

a look rate many, you can we As organically said capital, level. We capacity ways like higher next to project we the Any at push that going to add get some not times. profitability and it capacity return add but want to spend far that change many that us what of next shareholders, to outstripping supply, we not supply-demand level. we're by mean can the certainly as upset situation that's we our even an accelerator is do, increase to to I have this in. demand going may the

we So well. we're what try looking that those we as that at in Hopefully, to as do area speak see can to answered the question.

Joshua Sullivan

Yes, to sneak scrap or one, mean one absolutely. on you externally? productivity. anything just us I provide last there we that just is throughput? that are I rates how point can measuring on productivity Or

Tony Thene

productivity certainly, of that's in all we areas Well, and that if product number, rework back a areas, massive. would know, certainly as rate overall have recovery, through scrap that say, any that you or pass bring first the There's productivity mean, multiple to I or product into running plant. drive those you do

that primary you outside really focused. the our productivity. pound, the that whatever we're is tell those be, in doesn't focus get a it's tonne reducing impact could mean Every again extra reduce massive every where getting amount back or some I go of it it might grinding and little rework. those I work can centers on is primary of up of So probably you rates

So really us for on those areas are a that a data are forefront basis. two

Operator

next The with Deutsche from is question Deuschle Bank. Scott

Scott Deuschle

for the start backlog already the the what into was quarter of in orders moved average backlog at this what the higher of price of average the quarter? than price new the was Tony,

Tony Thene

Yes.

see that's that the think certainly mean, You're from now going There see to at off, Scott, going say, line there should forward, that, be but times going least up. could going a bit going I to on trend that forward. you're some I could of yes, where probably be maybe I Yes.

Scott Deuschle

if be And would mix it of the just didn't of [indiscernible]. because probably go Okay. it up,

Tony Thene

that's I that a on to situation contracts Yes, of to be one in see rise could high mean, -- little there do guess that area as continue where going mix bit trend in were going renew. the very orders say hesitate But I and I a line. totality why based there that forward, you're that. to could the the

Scott Deuschle

entirely Was XX% the by was this of then the non-IGT pieces IGT. quarter? down? revenue actually And that driven energy And revenue growth were in

Tony Thene

down, that It's great was got oil and mean then give by That's a number bit question. really Oil year-over-year. year-over-year. piece and IGT I'll little driven and and sequentially you a in piece, inside as IGT the fact, a market, gas. know, XXX% interesting. up I XXX% IGT. we've you that's the gas The

So area. that's another

now margins. the line willing in of to take and listen, have these able says, produce of to into can somebody And for we And been how pay we're that the wait here advantage in Carpenter that a we've production a a all numbers long aerospace noise to we that, time ability, say, jump exploding, this aerospace with have industry. Technology and have these have we is market minute, to well, customers we the we coming us optionality wanting

extend some the now that. that aerospace to do the And in supply and with of ability chain looking further the chain, they uncertainty have relationship. to

So Carpenter advantage for Technology. that's a big

goes I it. enjoys not Scott think maybe certainly and everybody sometimes unnoticed

Scott Deuschle

your gas where turbines and shipping typical us remind would be on industrial you found who you alloys can then And are to?

Tony Thene

names, about anybody about think without the think turbines. Well, that's anybody making large naming IGT

at production bit on the it front melting case. different. bit a a alloy aerospace similar I know fishing that the cycle, market I engines You products. same some end just a mean, what -- into But ship into the goes process, a this is type in that different mean, the land, has least it's on little little of of of same you have jet what it's it's party now type So is -- a we right? engine of

for product attractive very a it's So us.

Scott Deuschle

at question. are Okay. that And I'll just is the aerospace? those are another market? -- end Or last that Dynamet, medical sneak or is Tim, push outs one

Timothy Lain

an not can you those characterize business. actually Yes, in Dynamet. materials more as the in additive, think aerospace-type I yes, pushouts additive Scott, are And our

Operator

[Operator Instructions].

We have the BTIG. next Madrid question with from Andre

Andre Madrid

immediate to in guess, the But I term. any I markets or at forward, these just a doing are 'XX, we term, potential weakness generation, lot see to the obviously, that in talked the gap fill maybe I long enough offset mean, about power looking beyond looking interim AR?

Tony Thene

both weakness. Well, aero believe get long I that Right. strong. is right in most level an whole Boeing And that going Andre, of This just So that a now to don't term. find don't that's good have will believe And happens, outstripping I demand of that, a to happen, way long any going have go be agreement I when a in I We phenomenon that through. weakness we'll into this going believe you're here mean, I just think too any that all reach the different us for to to macro in that's right? demand the case, aerospace is supply. fear mean, term, you you is near-term sides.

So the we going And now. onto you I forward, of Pirogen the have through not mindset to competing peer right going to you get see assets you're need as think being replacement. to kind aerospace for that's could get have a choppy this

Andre Madrid

exacerbated cadence? mentioned it. comp tough mean, is be just off know X how expectation. going to be you slides issues continue in we that's the this it on the a I 'XX should further? really And -- Could think it. about year. Got call, the I obviously, the beyond Like coming Got guess growth any I then But if

Tony Thene

players to get not resolved. in you mean, Right, the too big, I this And experience resolved. it's right? industry industry, get going my ads, to from in can to is just play of the Well, we I major other lot a can tell talking

running wide I -- to contracts of push side, back you repricing scenarios. 'XX everybody range the doing go productivity will XXXX. than optimization, is see being So our XXXX. mean this fiscal XXXX. mean as rate think on that we is the And with. with we gets see product bigger meaningful We're I'll XXXX, on our to XXXX tough build it we're what another be of resolved. to different from what up a that's going a comp aligned get viewpoint, saying And I step versus I

in think the companies of player significant This fact doubt. like own the this we It's is in that no and uncertainty, situation. industry. doom But attractiveness is optionality. can have gloom Carpenter a our a the certainly Technology to and with time particular pivot. stock we people want not that have that the mean, I large the There's others, fact strength we is and I a where some point

we It's the support to as line. have other an production to the move the ability grow to are support in customers and MRO up move and that that fact using this opportunity

environment. So very a and we you very type And technology they somebody to get see a you sky's perform actually to if that can this I time. like can It's me, like of normalcy, then time positive mean, limit. when in do will, more this back aggressive the exciting is ramp. copper very, an

Andre Madrid

just it. from more just charges closure? facility quarter. more sneak I in. could quarter's one last overflow it. Got additive Got If this Is this

Tony Thene

Yes.

that, got that's really arguably, behind So a to the it's have work just and go be transparent, should in point going and move prior the over ahead probably quarter inventory to little us. of just left that on just not just that and get we bit that and was to was the taken

Andre Madrid

of the it. So [indiscernible] full

Tony Thene

I that -- let's [indiscernible] million Andre, XXX not... you're material it's say just But not we're -- it's $X even mean, on about there's not while Yes. talking

Operator

from with Phil question is next The KeyBanc Markets. Capital Gibbs

Philip Gibbs

more up just SAO a Is to little that to is Tony, flat stronger on you be bridge of the -- for little seasonally took volume by QX the terms or driven looks relative bit preventative and. to the a in weaker one profitability. you maintenance bit

Tony Thene

that really take This activity to planned same is just mean, of about I type asked the quarter-over-quarter, answer maintenance right? some Josh preventive Phil. going you're in quarter. every maintenance, Yes. Thanks, listen, earlier

right you're the you're facility in your If way. not, running not

every to maintenance be planned quarter. going doing You're

our that plants, -- are. visited our have they people big how how realized plant Our

planned doing every quarter. you're So maintenance

other So if X in relatively, people customers. you two QX, end look the there at other big together. Certainly, production of year amount the QX you've about to -- got the think, comparing at I some days some most calendar of for the holidays quarters same

a of noise. little bit So that's

of numbers So pretty not pretty think those very with -- fact really some the We're the to operating with it's second a in still. strong I big guide higher issues we quarter, types can even quarter. that is

Xx for and was when we You've even a they that in mean higher And XXXX thought XXXX, knowing right while. were what we're time. a Xx been that I aerospace great around than now.

Philip Gibbs

you comments toward And volume, or that opportunities volume in the some end half more which Is there's pricing mind your higher that or to then made more full on dependent? is year back and guidance. perhaps on exceed seasonality, more guidance excluding your obviously, in stronger the

Tony Thene

it's we pricing three happens be going the productivity. and optimization Well, to stool, It's move major talk three going contract of how right? what those them. mix going any to legs about be of all from to all to product certainly forward, time we're mean, I

updates that achieve So all we And guidance them. looking at and then methodical very certainly, we're time. the with our we're then

move an So plant we on the moving calls guidance. go of how here forward as have are they And and we've as the folks earned can we working of by the past with tuned and that. step we see speak, And a took the update the end stay that. in next couple high reputation, that to as out we through

Philip Gibbs

And the acceleration I again MRO is because on said in where toward of the the quarter? acceleration, end have that some made you so the that was more that the early quarter. would come to Where was you emergency the more the Was me -- work that expedites essentially side, tail relative you and seen for last some there. so guess, one

Tony Thene

but aerospace that's but quarter of it's And back side, primarily or aerospace end we good would generation whether end on power as that the the MRO in the side, news. the towards I pick OEM, saw where general, depending acceleration other of aerospace others, the on up just primarily the and say, customer, certainly was Yes. areas in the towards well, the quarter. for although was on

Operator

have We Bank. a Deuschle follow-up question Scott with from Deutsche

Scott Deuschle

see point at market space for companies and like material Tony, reached you you yet? from do, demand do SpaceX has alloys in it's where all much a if demand that the

Tony Thene

player. you and customer with -- mean want major So about. don't that's mean, I talked they're specifically that I the additive Yes. a to I customer, go right? an far. too

So the order. that's see in that some you choppiness of

small, strong. but consistent. So not yes, Yes, still it's

business the additive. I you those profitability additive what depending on have from like quarter-to-quarter swings in, come drive very if bus. time to in it how see That's orders spend since So market much mean additive too on their for right? the the small at you look and a doesn't really

and couple a players have players. in market, a smaller you very of But of then have that long tail you big

basis. big some a those in move have you if profitability the really So it can on quarter-to-quarter ones, movement

Operator

would concludes you. Huyette like back John over This I conference session. turn question-and-answer remarks. closing to the our to for to any Mr. Over

John Huyette

XXXX fiscal Thank call. and you, conference you, rest a everyone, Xst for operator, for year thank great your day. quarter today joining of us our Have

Operator

has conference attending now you concluded. for The presentation. you. today's Thank Thank

disconnect. now You may

Carpenter Technology (CRS) 24 Oct 242025 Q1 Earnings call transcript