TIMET Reports Second Quarter 2008 Results

DALLAS, Aug. 5 /PRNewswire-FirstCall/ -- Titanium Metals Corporation
("TIMET" or the "Company") (NYSE: TIE) reported net income attributable to
common stockholders of $47.3 million, or $0.26 per diluted share, for the
quarter ended June 30, 2008, compared to $76.3 million, or $0.42 per diluted
share, for the quarter ended June 30, 2007.
The Company's net sales were $297.3 million during the second quarter of
2008 compared to $341.2 million during the second quarter of 2007. Over the
past year, increases in global titanium sponge capacity and manufacturing
activity for titanium products have increased availability of titanium sponge
and scrap, which has resulted in declining costs for these raw materials.
This decline in raw material costs, in turn, has contributed to lower selling
prices for TIMET's products due in part to raw material indexed pricing
adjustments under certain of the Company's long-term agreements, as well as
contributing to lower selling prices for our non-contract sales volumes.
Revisions and delays in the build-out schedules of certain commercial
aircraft continue to affect near-term demand, impacting sales volumes and
selling prices for titanium products. The Company continues to emphasize
selling higher grades of melted and mill products, which are generally less
susceptible to pricing pressures resulting from demand fluctuations. As a
result of these factors, TIMET's net sales volume for melted products declined
35% for the second quarter of 2008 compared to the same period in 2007,
whereas the Company's net sales volume for mill products increased 5% over the
same periods. TIMET's mill products sales volume in the second quarter of
2008 was a new quarterly record for the Company.
Operating income for the second quarter of 2008 was $68.8 million compared
to $118.0 million during the same period in 2007. Operating income was
negatively affected by declining prices, decreased sales volumes for melted
products and increased costs related to raw materials. Although the Company's
cost of purchased titanium sponge and scrap declined during the latter part of
2007 and the first half of 2008, indexed pricing adjustments in certain
long-term customer supply agreements typically precede the realization of
lower product cost of sales due to the length of the manufacturing cycle for
the production of melted and mill products.
The Company's sales order backlog at the end of June 2008 was $0.8 billion
compared to $1.0 billion at the end of December 2007.
Steven L. Watson, Vice Chairman and Chief Executive Officer, said, "The
previously announced adjustments and delays in the production schedule for the
Boeing 787 Dreamliner(TM) and other new generation commercial aircraft are
expected to continue to impact customer inventory levels and product mix.
Consequently, our results of operations continue to be affected by the
resulting reductions in near-term titanium metal needs in the commercial
aerospace industry. Despite these near-term issues, we continue to believe
the global commercial aerospace market will provide substantial long-term
demand increases with the manufacture of new generation aircraft that require
the use of significantly higher amounts of titanium. The outlook for TIMET,
and the titanium metal industry as a whole, remains very positive, and we
believe the demand for titanium metal in all major and emerging market sectors
continues to have significant long-term growth potential.
"The July 2008 update of the annual forecast for commercial aircraft
deliveries from The Airline Monitor, a leading aerospace publication, reflects
a one percent increase to the aggregate forecast of commercial aircraft
deliveries for the ten-year period of 2008 through 2017 compared to the
January 2008 forecast. This updated forecast supports our belief that
long-term industry-wide demand trends will remain strong for the foreseeable
future, and as a result, we will continue to pursue our strategic plans by
expanding our productive capacity, with a focus on additional opportunities to
improve our operating flexibility, efficiency and cost structure. Over the
last two years, we have been successful in adding significant flexibility and
cost advantages to our raw material procurement and manufacturing process.
Our ongoing internal capacity expansion projects are on schedule, including
our major expansions in melting and scrap recycling. Due in great measure to
the success of our efforts to utilize long-term assured supply and conversion
services agreements, TIMET has maintained a strong financial position. We
believe our business is well positioned to respond to market demand volatility
in a timely and cost efficient manner, while supplying the growing needs of
our current and prospective customers, thus enabling us to capitalize on
current and future opportunities for growth and expansion."
The financial information contained in this release is subject to future
correction and revision and the filing of the Company's Quarterly Report on
Form 10-Q for the quarter ended June 30, 2008 with the Securities and Exchange
Commission ("SEC") and should be read in conjunction with the consolidated
financial statements and notes thereto included in the Company's most recent
reports on Form 10-K and Form 10-Q filed with the SEC.
The statements contained in this release that are not historical fact are
forward-looking statements that represent TIMET management's beliefs and
assumptions based on currently available information. Forward-looking
statements can generally be identified by the use of words such as "believes,"
"intends," "may," "will," "looks," "should," "could," "anticipates," "expects"
or comparable terminology or by discussions of strategies or trends. Although
TIMET believes that the expectations reflected in such forward-looking
statements are reasonable, it does not know if these expectations will prove
to be correct. Such statements by their nature involve substantial risks and
uncertainties that could significantly affect expected results. Actual future
results could differ materially from those described in such forward-looking
statements, and TIMET disclaims any intention or obligation to update or
revise any forward-looking statements, whether as a result of new information,
future events or otherwise. Among the factors that could cause actual results
to differ materially are the risks and uncertainties discussed in this
release, including risks and uncertainties in those portions referenced above
and those described from time to time in the Company's other filings with the
SEC which include, but are not limited to:
-- the cyclicality of the commercial aerospace industry;
-- the performance of aerospace manufacturers and TIMET under long-term
agreements; -- the existence or renewal of certain long-term
agreements;
-- the difficulty in forecasting demand for titanium products;
-- global economic and political conditions;
-- global production capacity for titanium;
-- changes in product pricing and costs;
-- the impact of long-term contracts with vendors on TIMET's ability to
reduce or increase supply; -- the possibility of labor disruptions;
-- fluctuations in currency exchange rates;
-- fluctuations in the market price of marketable securities;
-- uncertainties associated with new product or new market development;
-- the availability of raw materials and services;
-- changes in raw material prices and other operating costs (including
energy costs);
-- possible disruption of business or increases in the cost of doing
business resulting from terrorist activities or global conflicts;
-- competitive products and strategies; and
-- other risks and uncertainties.
Should one or more of these risks materialize (or the consequences of such
a development worsen), or should the underlying assumptions prove incorrect,
actual results could differ materially from those forecasted or expected.
TIMET, headquartered in Dallas, Texas, is a leading worldwide producer of
titanium metal products. Information on TIMET is available on its website at
http://www.timet.com.

TITANIUM METALS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In millions, except per share and product shipment data)
(Unaudited)

Three months ended Six months ended
June 30, June 30,
2007 2008 2007 2008

Net sales $341.2 $297.3 $682.9 $591.0
Cost of sales 205.7 213.0 414.0 425.6

Gross margin 135.5 84.3 268.9 165.4

Selling, general, administrative and
development expense 17.7 16.2 35.0 33.5
Other income (expense), net 0.2 0.7 0.3 (0.3)

Operating income 118.0 68.8 234.2 131.6

Other non-operating income (expense),
net 0.4 0.6 0.2 (1.5)

Income before income taxes and
minority interest 118.4 69.4 234.4 130.1

Provision for income taxes 37.9 20.8 74.3 38.7
Minority interest in after-tax earnings 2.8 1.2 5.9 3.6

Net income 77.7 47.4 154.2 87.8

Dividends on Series A Preferred Stock 1.4 0.1 2.8 0.2

Net income attributable to common
stockholders $76.3 $47.3 $151.4 $87.6

Earnings per share attributable to
common stockholders:
Basic $0.47 $0.26 $0.94 $0.48
Diluted $0.42 $0.26 $0.84 $0.48

Weighted average shares outstanding:
Basic 162.1 181.0 161.9 181.8
Diluted 184.3 182.0 184.3 183.0

Melted product shipments:
Volume (metric tons) 1,310 845 2,640 1,945
Average selling price (per
kilogram) $42.20 $32.60 $43.35 $31.55

Mill product shipments:
Volume (metric tons) 3,595 3,785 7,315 7,355
Average selling price (per
kilogram) $69.65 $62.35 $68.00 $63.30

SOURCE Titanium Metals Corporation

John A. St. Wrba, Vice President and Treasurer of Titanium Metals Corporation,
+1-972-233-1700