NEW YORK Carpenter
Technology Corp. said it expects strong shipments of premium
products such as aerospace and high-temperature alloys to buoy
its earnings in the final months of the calendar year, even as
makers of more commoditized steel products are generally
expecting poorer results.
"There are very few companies
that can service these (premium) segments, and this is why our
business is less impacted by some of the macroeconomic factors
that are affecting the general steel industry," president and
chief executive officer William Wulfsohn said during
the companys fiscal first-quarter earnings call
Carpenter, however, said it
still expects to achieve operating earnings growth of 70
percent, or about $70 million, in its fiscal 2013.
"We remain on
track to achieve the targeted financials that we set earlier
for the fiscal year," Wulfsohn said.Carpenters upbeat
outlook comes as the company reported strong earnings for
its fiscal first quarter of 2013 ended Sept. 30 on robust
demand for its premium products, even as it saw a slowdown in
demand for lower-value products "where economic and political
uncertainty impact demand," Wulfsohn said.
The Wyomissing, Pa.-based
company recorded net income of $39.2 million during the quarter
on net sales of $544.9 million, 64.7 percent higher than net
income of $23.8 million on net sales of $414.1 million in the
same quarter a year ago.
Carpenter started up one of
three new vacuum-arc remelt (VAR) furnaces at its recently
acquired Latrobe operations during the quarter as it sought to
expand its premium metal output.
"Our backlog (on premium
products) is consuming all of our capacity," Wulfsohn said.
The company sold 64 million
pounds of product during the quarter, 36.2 percent more than
the 47 million pounds sold in the same period last year.
Some 16.1 million pounds were
attributable to Latrobe, the company said, noting that
integration of the new operations going well.
"In some cases, yields and
productivity have improved by more than 30 percent," Wulfsohn
Aerospace and energy showed the
biggest market-segment growth during the quarter, with sales in
aerospace rising 45 percent to $252.6 million compared to the
same period last year, while energy sales rose a 31 percent to
Aerospace sales were driven by
increased demand for alloys in engine making and titanium
fasteners, according to the company.
sales jumped 19 percent to $163.8 million compared with the
first fiscal quarter last year, largely due to higher sales to
Chinese aerospace forging customers and the Japanese aerospace
supply chain, Carpenter said.