RTI Nets $7.1M, Restructures to 2 Business Segments
PITTSBURGH -- RTI International Metals Inc. reported fourth-quarter net income of $7.1 million, or 23 cents per diluted share, compared with breaking even the same quarter a year ago. The company also announced it has structured such that it has combined its global operations into two segments: “Titanium” and “Engineered Products and Services.”
“The organizational changes are an outgrowth of RTI’s move to transform itself into an integrated supplier of advanced titanium products and services across the entire supply chain," said Dawne S. Hickton, vice chairman, president and CEO. "In recent years, RTI has invested more than $400 million in new plant, equipment and acquisitions to implement its strategy."
Net sales for the fourth quarter increased nearly 40% to $196.4 million compared with the same quarter of 2011, and operating income increased to $17.2 million versus $4.6 million.
For full-year 2012, net income was $23.5 million, or 77 cents per diluted share, versus net income of $6.6 million, or 22 cents per diluted share, for 2011. Net sales rose to $738.6 million, a nearly 40% increase, and operating income nearly doubled to $55 million. The order backlog increased 16.4% year-over-year to $554 million, and the company ended 2012 with cash on hand of $97.2 million and $230 million of convertible debt due in 2015.
During 2012, RTI progressed in its transformation to a fully integrated manufacturer and fabricator of advanced titanium products that serves diversified markets including aerospace and defense, medical devices and energy exploration and production, Hickton said. The centerpiece of this progress was the acquisition and integration of Remmele Engineering. The company also benefited from the growing needs of its energy market customers for advanced, engineered structural components for deepwater drilling and exploration applications. The increase in demand tripled sales to this sector of the company’s business versus the previous year.
“For 2013, we expect to see modest growth in both our consolidated sales and operating income," Hickton said. "Sales are currently anticipated to approach $775 million with operating income to be within a range of $65 million to $75 million. Titanium mill product volumes are expected to be slightly lower than the 16.5 million pounds shipped in 2012. On the other hand, based on the latest information from Boeing, seat track component shipments for the 787 Dreamliner are expected to exceed 75 ship sets. Our capital expenditures are expected to be in the range of $50 million to $60 million.
“Despite this guidance, I would caution investors that we expect the first half of the year to exhibit some softness with good momentum developing during the last six months, driven by an accelerated production schedule for 787 components and sequential increases in mill product demand," she continued. This early softness could result in first quarter operating income of less than $10 million.”
RTI International Metals Inc. has plants in the United States, Canada, Europe, and Asia.
Published by The Business Journal, Youngstown, Ohio.
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