After years of frustration, RTI International Metals Inc. is
finally making a profit in its main role on Boeing Co.s
Dawne S. Hickton, vice
chairwoman, president and chief executive officer of the
Pittsburgh-based titanium producer, distributor and fabricator,
said RTI is producing titanium seat track shipsets for the 787
at a rate of seven per month. "June was the first-ever
profitable month on that program," she said during a
second-quarter earnings conference call.
RTI, which expects to
ship more than 80 Dreamliner shipsets this year compared with
44 last year, previously said it needed to reach more than six
shipsets per month for the program to reach profitability. The
seat tracks are fabricated at its RTI Claro subsidiary in
Montreal, supported by its Houston extrusion facility.
RTI built a facility
at RTI Claro in 2007 in part to support the seat-track program,
which was expected to bring the company about $900 million in
business from 2008 through 2017. But the Dreamliner
subsequently suffered more than three years in delays, and by
early last year RTI appeared impatient with the programs
lack of progress.
"We never thought that
by 2012 wed be sitting at three shipsets a month,"
Hickton said last year (
amm.com, Feb. 9, 2012).
The seat tracks are
RTIs main involvement on the Dreamliner. Unlike other
major titanium producers, such as Allegheny Technologies Inc.,
Precision Castparts Corp.s Titanium Metals Corp. unit and
Russias VSMPO-Avisma Corp., RTI is not a direct supplier
of mill products to Chicago-based Boeing under the plane
builders system of long-term supply agreements.
Hickton said that a
previously announced expansion of its seven-year supply
agreement with Montreal-based airliner and business jet builder
amm.com, June 19) will amount to $90 million and
include $20 million in business on new programs, among them
Bombardiers new C Series airliner as well as its Learjet
85 and Global 7000 and 8000 business jets.
Meanwhile, a pretax
charge of $13.7 million related to RTIs early debt
retirement this year contributed to a 78.6-percent drop in
second-quarter net income to $1.11 million from $5.16 million
in the same period last year despite an 18.4-percent increase
in sales to $215.8 million.
of titanium mill products fell 4.7 percent to 4.1 million
pounds from 4.3 million pounds a year earlier due primarily to
lower sales of prime mill products, but its average realized
price rose 3 percent to $19.57 per pound. Hickton said mill
product shipments this year should approach the 16.5 million
pounds shipped in 2012.