Carpenter Technology Provides Update on Expected Second Quarter Results; Expresses Confidence in Underlying Demand Strength for Premium and Ultra-Premium Products

Tue Jan 15, 2013 5:53pm EST

* Reuters is not responsible for the content in this press release.

WYOMISSING, Pa.--(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 

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.

Carpenter Technology Corporation
Media Inquiries:
William J. Rudolph, Jr., 610-208-3892
Investor Inquiries:
Michael A. Hajost, 610-208-3476

Copyright Business Wire 2013

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