RTI Announces Record Results for 2007
NILES, Ohio--(BUSINESS WIRE)--February 19, 2008-- RTI International Metals, Inc. (NYSE: RTI) released results today for the full year and fourth quarter of 2007. Highlights include:
Full Year 2007 Results
-- 2007 net sales increased 24% from 2006 to a record $626.8
million
-- 2007 operating income increased 22% from 2006 to a record
$141.2 million
-- Net income for the year was a record $92.6 million, up 22%
from $75.7 million in 2006
-- As of December 31, 2007, the Company had $107.5 million in
cash and cash equivalents, after capital expenditures during
the year of $65 million
Fourth Quarter 2007 Results
-- Net sales of $163.8 million
-- Operating income of $39.4 million
-- Net income of $24.9 million
For the full year 2007, the Company reported net sales of $626.8 million versus net sales of $505.4 million for 2006, a 24% increase. Operating income for the year increased 22% from $115.3 million in 2006 to $141.2 million in 2007. Net income for the year was $92.6 million, or $4.00 per diluted share. Net income for 2006 was $75.7 million or $3.29 per diluted share.
For the fourth quarter ended December 31, 2007, the Company reported net sales of $163.8 million compared to $143.8 million in the fourth quarter of 2006, an increase of 14%. Operating income was $39.4 million versus $40.6 million in 2006. Fourth quarter net income was $24.9 million or $1.08 per diluted share in comparison to $26.8 million or $1.16 per diluted share for the same period in the prior year. The quarterly year-over-year comparison reflected the unprecedented business climate for titanium during the fourth quarter of 2006.
Titanium Group
For the year 2007, RTI's Titanium Group posted operating income of $102.6 million including the impact of the $7.2 million duty drawback charge on net sales of $434.3 million including intersegment sales of $181.2 million. This performance surpassed 2006 operating income of $78.5 million on sales of $356.9 million, including intersegment sales of $152.0 million. Mill product shipments for the year were 15.4 million pounds at an average realized price of $26.58 per pound up 28% over RTI's average realized price for 2006.
For the fourth quarter of 2007, the Titanium Group posted operating income of $33.7 million on sales of $114.1 million, including intersegment sales of $45.4 million. Mill product shipments for the fourth quarter were 4.0 million pounds at an average realized price of $27.34 per pound compared to mill product shipments of 3.9 million pounds in 2006 at an average realized price of $22.45 per pound.
Dawne S. Hickton, Vice Chairman & CEO commented, "The Titanium Group had its second consecutive record year in 2007. Net sales, operating income and earnings were at all-time highs. We extended our contract with Airbus, as well as the Joint Strike Fighter (JSF) contract with Lockheed Martin. To support these long-term contracts, we made major commitments to increase our titanium melting, forging and rolling capability, and to ensure a reliable supply of raw material through the new sponge plant in Hamilton, Mississippi. In light of these and other initiatives, I look forward to even better results for 2008."
Fabrication & Distribution Group
For 2007, net sales for the Fabrication & Distribution Group ("F&D") grew 24% to a record $373.7 million versus $300.5 million in 2006. The F&D Group also had record operating income of $38.6 million for the year, compared to $36.8 million in 2006. For the fourth quarter of 2007, the F&D Group posted operating income of $5.7 million on sales of $95.1 million. During the same period in 2006, this Group had operating income of $15.4 million on sales of $92.9 million.
"The modest increase in operating income was impacted by costs relating to our Houston and new Montreal facilities, as our spending increased in anticipation of meeting the demands of the Boeing 787 contract, as well as a softening in prices for certain products sold by our distribution facilities," said Dawne Hickton. "For 2008, we expect that the F&D Group's operating results will continue to improve as production at the Houston and Montreal facilities ramp up to support the $900 million long-term agreement with Boeing, as well as other initiatives."
Expansions
During 2007, we substantially completed our previously announced $35 million expansion in the Titanium Group to support the $800 million 10-year Airbus contract announced in 2006, as well as the $43 million expansion in the F&D Group for the Boeing 787 program.
The Company's capital expenditures for the year were $65 million of which $6 million was related to the future sponge and mill expansion projects while the remaining $59 million was related to previously announced expansions, replacement and maintenance requirements.
Outlook
"Our major capital expansion projects are on track to support the $4 billion of long-term agreements we have signed that ramp up production in 2010 and beyond," said Dawne Hickton. "Our cash on hand at year-end was $107.5 million, and with our new credit facility of $240 million in place, we are well positioned to support the more than $400 million in announced capital expenditures, while we continue to seek additional growth opportunities. For 2008, we expect mill product shipments to range between 17 - 18 million pounds at an average realized price lower than that experienced in 2007. We also expect sales to increase 15 - 20% and operating income to increase 7 - 12% versus 2007."
The statements in this release relating to matters that are not historical facts are forward-looking statements that may involve risks and uncertainties. These include, but are not limited to, the impact of global events on the commercial aerospace industry, military spending and continued support for programs such as the Joint Strike Fighter, global economic conditions, the competitive nature of the markets for specialty metals, the ability of the Company to obtain an adequate supply of raw materials, the expansion of the scope of U.S. Custom's current investigation of the Company's duty drawback claims beyond those claims currently identified as being under investigation, the potential imposition of fines and penalties by U.S. Customs, the results of the Company's ongoing internal duty drawback investigation, the successful completion of our capital expansion projects, and other risks and uncertainties included in the Company's filings with the Securities and Exchange Commission. Actual results can differ materially from those forecasted or expected. The information contained in this release is qualified by and should be read in conjunction with the statements and notes filed with the Securities and Exchange Commission on Forms 10-K and 10-Q, as may be amended from time to time.
RTI International Metals(R), headquartered in Niles, Ohio, is a leading U.S. producer of titanium mill products and fabricated metal components for the global market. Through its various subsidiaries, RTI manufactures and distributes titanium and specialty metal mill products, extruded shapes, formed parts and engineered systems for aerospace, industrial, defense, energy, chemical and consumer applications for customers around the world. To learn more about RTI International Metals, Inc., visit our website at www.rtiintl.com.
