RTI International Metals, Inc.
), the producer and supplier of titanium mill products, reported
earnings of 23 cents per share in fourth-quarter 2012 compared
with break-even results in the same period last year. The results
surpassed the Zacks Consensus Estimate of 16 cents.
For full-year 2012, RTI International posted earnings of 77 cents
per share, exceeding the Zacks Consensus Estimate by 27
Revenues surged 38.4% to $196.4 million in the quarter from
$141.9 million in the year-ago quarter. It was also ahead of the
Zacks Consensus Estimate of $190 million. The year-over-year rise
in revenues is attributable to higher demand from the energy
market customers for advanced, engineered structural components
required for deepwater drilling and exploration applications.
Sales were also aided by favorable scrap input costs in the
For full-year 2012, revenues increased 39.4% to $738.6 million
from $529.7 million in 2011, beating the Zacks Consensus Estimate
of $732 million.
Results in 2012 were supported by the acquisitions of Remmele
Engineering and RTI Advanced Forming. Sales related to 787
Dreamliner accelerated throughout the year and ended with total
shipments of 44 seat track ship sets. This contributed to the
rise in sales of engineered components for deepwater
applications, mainly in the Gulf of Mexico. RTI International
also benefited from increased demand from energy market
Sales slipped 5.5% year over year to $76.6 million (including
intersegment sales of $37.1 million) in the reported quarter.
Shipments also fell to 3.7 million pounds at an average realized
price of $19.13 per pound in the quarter from 4 million pound at
an average realized price of $19.11 per pound a year ago.
Sales soared 101.4% year over year to $119.2 million (including
intersegment sales of $17.8 million). The healthy increase was
mainly driven by the acquisition of Remmele Engineering in Feb
2012 and RTI Advanced Forming in Nov 2011.
Sales decreased 3% year over year to $56.6 million (including
intersegment sales of $1.1 million).
RTI International ended 2012 with weak liquidity position as
cash and cash equivalents decreased 38% to $97.2 million from
$156.8 million recorded a year ago. Long-term debt was $198.4
million as of Dec 31, 2012, up 6.1% from $186.9 million as of Dec
31, 2011. The company ended 2012 with $230 million of convertible
debt due in 2015.
The acquisition of Remmele Engineering has helped RTI
International to emerge as a fully-integrated manufacturer and
fabricator of advanced titanium products serving diversified
markets. These products are used in various markets, including
aerospace and defense, medical devices and energy exploration and
Remmele provided engineering and advanced robotic
manufacturing technology to the company's capabilities and
allowed it to diversify into fast-growing new end markets.. Sales
from the recent acquisitions amounted to $146.3 million in
For 2013, RTI International expects sales to be nearly $775
million with operating income in the range of $65 million to $75
million. Titanium mill product volumes are expected to be roughly
16.5 million pounds. Seat track component shipments for the 787
Dreamliner are expected to exceed 75 ship set. Capital
expenditure is expected to be within the range of $50 million to
$60 million. Overall, the company expects to see moderate growth
in both consolidated sales and operating income.
However, RTI International expects first-half 2013 to exhibit
some softness in production. Nevertheless, it sees healthy
momentum in the second half owing to accelerated production
schedule for 787 components and sequential increases in mill
product demand. For the first quarter, operating income is
expected to be lower than $10 million.
RTI International, which is among the prominent steel
specialty companies along with
Sutor Technology Group Limited
CITIC Pacific Ltd.
Material Sciences Corporation
), currently retains a Zacks Rank #4 (Sell).
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