Carpenter Technology Provides Update on Expected Second Quarter Results; Expresses Confidence in Underlying Demand Strength f...
January 15 2013 - 5:53PM
Business Wire
Carpenter Technology Corporation (NYSE:CRS) today reported that
it expects net sales, excluding surcharge, of $431 million for its
second fiscal quarter ended December 31, 2012. This compares to
$441 million reported in the first fiscal quarter of 2013, and is
30 percent higher than the second quarter of fiscal year 2012.
Carpenter continued to see strong demand for its Premium and
Ultra-Premium products sold into the Aerospace and Energy markets,
but saw weaker demand in lower value product lines, which were
impacted by current economic uncertainty.
Carpenter now expects second quarter earnings per diluted share
to be approximately $0.61 to $0.62, which is about 20 percent
higher than the prior fiscal second quarter, but below the $0.74
per diluted share reported in the first quarter of fiscal year
2013. The earnings increase versus Q2 2012 was driven primarily by
the acquisition of Latrobe, which is delivering higher than
expected synergies, and improved overall pricing/mix actions. The
sequential reduction in earnings versus Q1 2013 is due to weaker
Performance Engineered Products (PEP) segment performance, softer
demand for lower value mill products, and the impact of production
balancing within Specialty Alloys Operations (SAO).
“We continue to see strong end-market demand for our Premium and
Ultra-Premium products where we remain capacity constrained, and
are delivering above target near-term Latrobe synergies,” said
William A. Wulfsohn, President and Chief Executive Officer. “We
also see uncertainty in demand for lower value mill products and
are performing below plan in the PEP business segment. Therefore,
we currently expect full year operating income improvement of 20 to
30 percent versus our last fiscal year. We are confident in the
strategic actions we are taking, and remain on track to deliver our
mid-decade earnings target.”
The fiscal year 2013 earnings target excludes the anticipated
financial impact from selling the Latrobe distribution business,
and one-time costs associated with the inventory reduction
initiative and footprint optimization actions that will be outlined
in further detail during the upcoming investor call.
As previously announced, Carpenter will report its second
quarter results on Thursday, January 31, 2013 and host a conference
call and webcast at 10:00 a.m., Eastern Time on that day to discuss
more fully the results of operations, refine its full fiscal year
targets and further review management actions to drive its longer
term strategy.
About Carpenter Technology
Carpenter produces and distributes premium alloys, including
special alloys, titanium alloys and powder metals, as well as
stainless steels, and alloy and tool steels. Information about
Carpenter can be found on the Internet at
http://www.cartech.com.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Act of 1995. These
forward-looking statements are subject to risks and uncertainties
that could cause actual results to differ from those projected,
expected, anticipated or implied. The most significant of these
uncertainties are described in Carpenter’s filings with the
Securities and Exchange Commission including its annual report on
Form 10-K for the year ended June 30, 2012, the 10Q for the quarter
ending September 30, 2012 and the exhibits attached to those
filing. They include but are not limited to: (1) expectations with
respect to the synergies, costs and other anticipated financial
impacts of the Latrobe acquisition transaction could differ from
actual synergies realized, costs incurred and financial impacts
experienced as a result of the transaction; (2) the cyclical nature
of the specialty materials business and certain end-use markets,
including aerospace, defense, industrial, transportation, consumer,
medical, and energy, or other influences on Carpenter’s business
such as new competitors, the consolidation of competitors,
customers, and suppliers or the transfer of manufacturing capacity
from the United States to foreign countries;(3) the ability of
Carpenter to achieve cost savings, productivity improvements or
process changes; (4) the ability to recoup increases in the cost of
energy, raw materials, freight or other factors; (5) domestic and
foreign excess manufacturing capacity for certain metals; (6)
fluctuations in currency exchange rates; (7) the degree of success
of government trade actions; (8) the valuation of the assets and
liabilities in Carpenter’s pension trusts and the accounting for
pension plans; (9) possible labor disputes or work stoppages; (10)
the potential that our customers may substitute alternate materials
or adopt different manufacturing practices that replace or limit
the suitability of our products; (11) the ability to successfully
acquire and integrate acquisitions, including the Latrobe
acquisition; (12) the availability of credit facilities to
Carpenter, its customers or other members of the supply chain; (13)
the ability to obtain energy or raw materials, especially from
suppliers located in countries that may be subject to unstable
political or economic conditions; (14) Carpenter’s manufacturing
processes are dependent upon highly specialized equipment located
primarily in facilities in Reading and Latrobe, Pennsylvania for
which there may be limited alternatives if there are significant
equipment failures or catastrophic event; and (15) Carpenter’s
future success depends on the continued service and availability of
key personnel, including members of our executive management team,
management, metallurgists and other skilled personnel and the loss
of these key personnel could affect our ability to perform until
suitable replacements are found. Any of these factors could have an
adverse and/or fluctuating effect on Carpenter’s results of
operations. The forward-looking statements in this document are
intended to be subject to the safe harbor protection provided by
Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. Carpenter
undertakes no obligation to update or revise any forward-looking
statements.
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