NEW YORK Titanium
Metals Corp. (Timet) saw net income and sales fall in the third
quarter compared with the same period last year as a rise in
average selling prices only partially offset a drop in overall
shipment volumes, the company said.
Dallas-based Timet, which last
week announced its proposed acquisition by Precision Castparts
Corp. (PCC) (
amm.com, Nov. 9), recorded net income of $18.6
million for the three months ended Sept. 30, down 25.6 percent
from $25 million a year earlier, on sales that slipped 1.8
percent to $257.7 million from $262.5 million.
The companys lower
earnings were partially the result of lower industrial product
sales by volume, even as it continued to report strong demand
for mill products for the commercial aerospace sector, Timet
"The commercial aerospace sector
is poised for sustained growth over the next several years as
announced production rates for next-generation airframes and
engines are achieved. Record backlogs for commercial aircraft
manufacturers reflect the demand for global fleet replacement
and expansion, which will drive significant titanium demand for
our business for years to come," president and chief executive
officer Bob OBrien said in a statement.
"To position ourselves for the
expected demand growth under these platforms as the global
fleet expands, we have several capital projects in progress to
increase melt capacity and capability and to improve efficiency
at facilities in the U.S. and abroad, with completion expected
to coincide with the significant ramp-up of production," he
Timet reported melted product
shipments of 1,300 tonnes in the third quarter, down from 1,565
tonnes in the same year-ago period. This was even as mill
product shipments rose slightly to 3,965 tonnes from 3,955
tonnes in the same comparison.
Last week, Portland, Ore.-based
PCC announced it entered into a definitive agreement to acquire
Timet for $16.50 per share in a cash deal valued at about $2.9
"Timet will provide us with the
titanium capability that has always been a key missing piece of
our overall product portfolio," PCC chairman and chief
executive officer Mark Donegan said in a statement.
"Timets melting expertise and PCCs forging and
conversion assets are a complementary strategic fit."
The boards of directors for both
companies have each unanimously approved the
Under the terms of the deal, PCC
will launch a tender offer to acquire 100 percent of
Timets outstanding common stock by Nov. 20, the companies