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RTI International Up on Solid Q3 Earnings - Analyst Blog

Posted: 11/13/2013 9:00:00 AM
Referenced Stocks: ATI;BA;CRS;RTI

Titanium mill products maker RTI International ( RTI ) saw its profit surge more than three-fold in the third quarter of 2013 on lower raw material costs in its Titanium division and healthy momentum in its commercial aerospace business. Its shares rose as much as 3% following the earnings announcement. The stock is up around 23% so far this year.  

The Pennsylvania-based company posted earnings of 37 cents per share from continuing operations in the reported quarter versus 11 cents a share recorded a year ago. Consolidated profit soared to $12.3 million from $3.6 million in the year-ago quarter.  

Barring favorable tax impact, earnings of 31 cents per share from continuing operations topped the Zacks Consensus Estimate by 8 cents.

RTI International, which is among the prominent specialty steel companies along with Carpenter Technology Corp. ( CRS ) and Allegheny Technologies Inc. ( ATI ), logged revenues of $196.5 million, up 8% year over year. It was ahead of the Zacks Consensus Estimate of $192 million. A double-digit rise in revenues in the Engineered Products and Services segment more than offset a modest decline in the Titanium division.  

Revenues from the Titanium Segment edged down roughly 0.5% year over year to $89.7 million in the reported quarter as lower prime mill product shipments sales was masked by higher sales to European commercial aerospace customers. Lower raw materials costs contributed to a three-fold rise in the segment's operating income.

Titanium mill product shipments were 4 million pounds at an average realized price of $18.57 per pound in the reported quarter versus 4.2 million pounds at an average realized price of $19.01 per pound logged a year ago.

The Engineered Products and Services segment had sales of $106.9 million in the quarter, a roughly 16% year over year rise. Higher commercial aerospace sales, mainly associated with Boeing ( BA ) platforms, more than offset declines in medical device and military market sales. Boeing 787 seat track deliveries reached 22 equivalent ship sets, closing the quarter at a 9 equivalent ship sets a month delivery rate.

RTI International ended the quarter with cash and cash equivalents of $315 million, a more than four-fold year over year surge. Long-term debt more than doubled year over year to $419.2 million.

RTI International backed its guidance for 2013 based on its results for the first nine months of 2013 and expectations for improved operating performance in the fourth quarter. The company continues to see total mill product shipments reaching 16.5 million pounds and sales approaching or surpassing $775 million in 2013. Operating income for the year is still expected in the band of $65 million to $75 million.

RTI International, which currently holds a Zacks Rank #3 (Hold), continues to reinforce its position as an advanced titanium engineering, precision machining and fabrication source of supply.

ALLEGHENY TECH (ATI): Free Stock Analysis Report

BOEING CO (BA): Free Stock Analysis Report

CARPENTER TECH (CRS): Free Stock Analysis Report

RTI INTL METALS (RTI): Free Stock Analysis Report

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