Carpenter Technology Reports Fourth Quarter and Fiscal Year 2024 Results
Carpenter Technology (NYSE: CRS) reported strong financial results for Q4 and FY 2024. Key highlights include:
- Q4 adjusted operating income of $125.2 million, up 39% sequentially
- Q4 adjusted EPS of $1.82
- FY 2024 adjusted operating income of $354.1 million, up 166% YoY
- Q4 adjusted free cash flow of $142.4 million
- FY 2025 operating income guidance of $460-500 million
- New $400 million share repurchase program authorized
The company exceeded Q4 guidance and delivered its most profitable year ever. Strong performance was driven by increased sales in Aerospace & Defense and Medical markets, improved productivity, and pricing actions. Carpenter is pulling forward its financial goals by 2 years, targeting FY 2025 for previously stated FY 2027 objectives.
Carpenter Technology (NYSE: CRS) ha riportato risultati finanziari solidi per il Q4 e l'anno fiscale 2024. Tra i principali risultati si evidenziano:
- Reddito operativo rettificato del Q4 di 125,2 milioni di dollari, in aumento del 39% rispetto al trimestre precedente
- EPS rettificato del Q4 di 1,82 dollari
- Reddito operativo rettificato per l'anno fiscale 2024 di 354,1 milioni di dollari, in aumento del 166% rispetto all'anno precedente
- Flusso di cassa libero rettificato del Q4 di 142,4 milioni di dollari
- Previsioni di reddito operativo per l'anno fiscale 2025 comprese tra 460 e 500 milioni di dollari
- Nuovo programma di riacquisto di azioni da 400 milioni di dollari autorizzato
La società ha superato le previsioni per il Q4 e registrato il suo anno più redditizio di sempre. Le forti performance sono state guidate dall'aumento delle vendite nei mercati Aerospaziale e Difesa e Medico, dal miglioramento della produttività e dalle azioni sui prezzi. Carpenter sta anticipando i suoi obiettivi finanziari di 2 anni, puntando all'anno fiscale 2025 per obiettivi precedentemente fissati per il 2027.
Carpenter Technology (NYSE: CRS) reportó resultados financieros sólidos para el Q4 y el año fiscal 2024. Los aspectos destacados incluyen:
- Ingreso operativo ajustado del Q4 de 125.2 millones de dólares, un aumento del 39% secuencial
- EPS ajustado del Q4 de 1.82 dólares
- Ingreso operativo ajustado para el año fiscal 2024 de 354.1 millones de dólares, un aumento del 166% interanual
- Flujo de caja libre ajustado del Q4 de 142.4 millones de dólares
- Guía de ingreso operativo para el año fiscal 2025 de entre 460 y 500 millones de dólares
- Nuevo programa de recompra de acciones de 400 millones de dólares autorizado
La empresa superó las expectativas del Q4 y registró su año más rentable hasta la fecha. El sólido rendimiento fue impulsado por el aumento de ventas en los mercados Aeroespacial y de Defensa y Médico, una mejor productividad y acciones de precios. Carpenter está adelantando sus metas financieras en 2 años, apuntando al año fiscal 2025 para los objetivos previamente establecidos para 2027.
카펜터 테크놀로지 (NYSE: CRS)는 2024 회계연도 Q4 및 연간 재무 실적을 강하게 보고했습니다. 주요 하이라이트는 다음과 같습니다:
- Q4 조정 운영 소득 1억 2,520만 달러, 전 분기 대비 39% 증가
- Q4 조정 주당 순이익(EPS) 1.82 달러
- 2024 회계연도 조정 운영 소득 3억 5,410만 달러, 전년 대비 166% 증가
- Q4 조정 자유 현금 흐름 1억 4,240만 달러
- 2025 회계연도 운영 소득 가이던스 4억 6천만~5억 달러
- 4억 달러 규모의 새로운 자사주 매입 프로그램 승인
회사는 Q4 가이던스를 초과 달성했으며, 역대 가장 수익성 높은 해를 기록했습니다. 강력한 실적은 항공우주 및 방산, 의료 시장의 매출 증가, 생산성 향상 및 가격 책정 조치에 의해 이끌어졌습니다. 카펜터는 2년 앞당겨 2025 회계연도를 목표로 2027년으로 설정된 목표들을 향해 나아가고 있습니다.
Carpenter Technology (NYSE: CRS) a annoncé de solides résultats financiers pour le Q4 et l'exercice 2024. Les points clés incluent:
- Résultat opérationnel ajusté du Q4 de 125,2 millions de dollars, en hausse de 39 % par rapport au trimestre précédent
- BPA ajusté du Q4 de 1,82 dollar
- Résultat opérationnel ajusté pour l'exercice 2024 de 354,1 millions de dollars, en hausse de 166 % par rapport à l'année précédente
- Flux de trésorerie libre ajusté du Q4 de 142,4 millions de dollars
- Prévision de résultat opérationnel pour l'exercice 2025 entre 460 et 500 millions de dollars
- Nouveau programme de rachat d'actions de 400 millions de dollars autorisé
L'entreprise a dépassé les prévisions du Q4 et a réalisé la meilleure année de son histoire en termes de rentabilité. Les performances solides ont été soutenues par une augmentation des ventes dans les marchés de l'aérospatiale et de la défense ainsi que dans le secteur médical, une productivité améliorée et des actions tarifaires. Carpenter avance ses objectifs financiers de 2 ans, visant l'exercice 2025 pour des objectifs précédemment fixés à 2027.
Carpenter Technology (NYSE: CRS) hat für das Q4 und das Geschäftsjahr 2024 starke Finanzergebnisse gemeldet. Wichtige Highlights sind:
- Bereinigtes Betriebsergebnis im Q4 von 125,2 Millionen USD, ein Anstieg um 39% im Vergleich zum Vorquartal
- Bereinigter Gewinn pro Aktie (EPS) im Q4 von 1,82 USD
- Bereinigtes Betriebsergebnis für das Geschäftsjahr 2024 von 354,1 Millionen USD, ein Anstieg um 166% im Jahresvergleich
- Bereinigter freier Cashflow im Q4 von 142,4 Millionen USD
- Betriebsergebnisprognose für das Geschäftsjahr 2025 zwischen 460 und 500 Millionen USD
- Neues Aktienrückkaufprogramm über 400 Millionen USD genehmigt
Das Unternehmen hat die Q4-Prognose übertroffen und das profitabelste Jahr seiner Geschichte erzielt. Die starke Leistung wurde durch steigende Verkaufszahlen in den Märkten für Luftfahrt & Verteidigung und Medizin, verbesserte Produktivität und Preisanpassungen vorangetrieben. Carpenter zieht seine finanziellen Ziele um 2 Jahre vor und visiert das Geschäftsjahr 2025 für die zuvor festgelegten Ziele für 2027 an.
- Record Q4 adjusted operating income of $125.2 million, up 39% sequentially
- FY 2024 adjusted operating income of $354.1 million, up 166% year-over-year
- Q4 adjusted free cash flow of $142.4 million
- FY 2025 operating income guidance raised to $460-500 million range
- New $400 million share repurchase program authorized
- Q4 net sales excluding surcharge up 15% sequentially
- Specialty Alloys Operations segment Q4 operating income up 36% sequentially to $140.9 million
- Q4 shipment volume down 8% year-over-year
Insights
Carpenter Technology's Q4 and FY2024 results showcase exceptional performance, marking a pivotal moment for the company. The record-breaking quarterly adjusted operating income of
The company's financial health is further emphasized by its robust cash flow generation, with
Looking ahead, Carpenter Technology's accelerated financial goals are particularly noteworthy. The company has pulled forward its operating income target of
Investors should pay close attention to the company's ability to maintain its impressive margins, particularly in the Specialty Alloys Operations segment, which achieved a
Carpenter Technology's stellar performance is underpinned by robust demand in key end-use markets, particularly Aerospace and Defense and Medical. The
The Aerospace and Defense sector, a primary driver of growth, is experiencing a resurgence post-pandemic. With major aircraft manufacturers ramping up production to meet backlog demands, Carpenter Technology is well-positioned to benefit from this upturn. The company's specialized alloys are critical components in aircraft engines and structures, making it a key beneficiary of the aerospace recovery.
In the Medical sector, the growing demand for advanced medical devices and surgical instruments continues to provide a steady stream of opportunities. Carpenter Technology's high-performance materials are essential in applications such as orthopedic implants and surgical tools, areas that are seeing increased demand due to aging populations and advancements in medical technology.
The company's focus on specialized solutions and its broad portfolio position it favorably for continued growth beyond FY2025. However, investors should monitor potential headwinds such as supply chain disruptions or economic slowdowns that could impact demand in key sectors. Additionally, the company's ability to pass on increased raw material costs to customers will be important in maintaining its impressive profit margins.
Overall, Carpenter Technology's market outlook appears strong, supported by positive trends in its core end-use markets and its strategic positioning in high-value, specialized materials.
Exceeded Fourth Quarter Operating Income Guidance
Delivered Most Profitable Year in Company History
Strong Fourth Quarter Adjusted Free Cash Flow
Pulling Operating Income Target Forward 2 Years to Fiscal Year 2025
Authorized Share Repurchase Program
PHILADELPHIA, July 25, 2024 (GLOBE NEWSWIRE) -- Carpenter Technology Corporation (NYSE: CRS) (the “Company”) today announced financial results for the fiscal fourth quarter and year ended June 30, 2024. For the quarter, the Company reported operating income of
Fourth Quarter Highlights
- Delivered
$125.2 million of adjusted operating income, up 39 percent sequentially and a record quarterly result - Realized adjusted earnings per diluted share of
$1.82 - Generated
$169.5 million of cash from operating activities, or$142.4 million of adjusted free cash flow - Increased net sales excluding surcharge 15 percent sequentially, driven by increased sales in Aerospace and Defense and Medical end-use markets
- Exceeded expectations in Specialty Alloys Operations (“SAO”) segment with operating income of
$140.9 million , up 36 percent sequentially - Delivered adjusting operating margin of 25.2 percent in the SAO segment, up from 21.4 percent in the previous quarter
- Completed most profitable year on record, with
$354.1 million in total adjusted operating income in fiscal year 2024, up 166 percent over fiscal year 2023
Fiscal Year 2025 Outlook
- Expect operating income to be in the range of
$460 million to$500 million , pulling forward financial goal 2 years from fiscal year 2027 to fiscal year 2025 - With operating income guidance, expect to generate
$250 million to$300 million in adjusted free cash flow, which represents approximately 85 percent conversion rate - For first quarter of fiscal year 2025, anticipate between
$114 million and$120 million in operating income - Well positioned for continued growth beyond fiscal year 2025 with strong market demand outlook for our broad portfolio of specialized solutions, increasing productivity, optimizing product mix and pricing actions
Share Repurchase Program
- Board of Directors authorized a share repurchase program of up to
$400 million - Will target offsetting dilution and taking advantage of strategic market opportunities
- Repurchases will be made from time to time at the Company’s discretion, based on general market conditions and the market price of its common stock
“In the fourth quarter of fiscal year 2024 we exceeded our previous guidance, generating
“We continue to drive earnings momentum through improved productivity, product mix optimization and pricing actions. Notably, the SAO segment generated
“With our operating momentum, we are pulling forward our fiscal year 2027 goal again, expecting to achieve
“Further, we expect to generate
“Carpenter Technology continues to exceed performance and outlook expectations. Having just completed a historic fourth quarter and fiscal year 2024, we are well positioned to achieve our accelerated goals and believe our earnings growth journey will extend far beyond fiscal year 2025.”
Financial Highlights
| Q4 | Q4 | YTD | YTD | ||||||||||
| ($ in millions, except per share amounts) | FY2024 | FY2023 | FY2024 | FY2023 | |||||||||
| Net sales | $ | 798.7 | $ | 758.1 | $ | 2,759.7 | $ | 2,550.3 | |||||
| Net sales excluding surcharge (a) | $ | 635.8 | $ | 560.0 | $ | 2,167.7 | $ | 1,848.0 | |||||
| Operating income | $ | 108.3 | $ | 62.9 | $ | 323.1 | $ | 133.1 | |||||
| Adjusted operating income excluding special items (a) | $ | 125.2 | $ | 62.9 | $ | 354.1 | $ | 133.1 | |||||
| Net income | $ | 93.6 | $ | 38.4 | $ | 186.5 | $ | 56.4 | |||||
| Earnings per diluted share | $ | 1.85 | $ | 0.78 | $ | 3.70 | $ | 1.14 | |||||
| Adjusted earnings per diluted share (a) | $ | 1.82 | $ | 0.78 | $ | 4.74 | $ | 1.14 | |||||
| Net cash provided from operating activities | $ | 169.5 | $ | 174.9 | $ | 274.9 | $ | 14.7 | |||||
| Adjusted free cash flow (a) | $ | 142.4 | $ | 144.1 | $ | 179.0 | $ | (67.6 | ) | ||||
| (a) non-GAAP financial measures explained in the attached tables | |||||||||||||
Net sales for the fourth quarter of fiscal year 2024 were
Operating income for the fourth quarter of fiscal year 2024 was
Cash provided from operating activities in the fourth quarter of fiscal year 2024 was
Total liquidity, including cash and available revolver balance, was
Share Repurchase Program
Carpenter Technology’s Board of Directors authorized a share repurchase program of up to
Under the terms of the share repurchase program, the Company may repurchase shares from time to time, in amounts, at prices, and at such times as the Company deems appropriate, subject to market conditions, legal requirements and other considerations. There is no stated expiration for the share repurchase program. The Company is not obligated to repurchase any specific number of shares or to do so at any particular time, and the share repurchase program may be suspended, modified or terminated at any time without prior notice.
Special Items
During the quarter ended June 30, 2024, the Company recorded pre-tax restructuring and asset impairment charges of
Conference Call and Webcast Presentation
Carpenter Technology will host a conference call and webcast presentation today, July 25, 2024, at 10:00 a.m. ET, to discuss the financial results of operations for the fourth quarter and full fiscal year 2024. Please dial +1 412-317-9259 for access to the live conference call. Access to the live webcast will be available at Carpenter Technology’s website (http://www.carpentertechnology.com), and a replay will soon be made available at http://www.carpentertechnology.com. Presentation materials used during this conference call will be available for viewing and download at http://www.carpentertechnology.com.
Non-GAAP Financial Measures
This press release includes discussions of financial measures that have not been determined in accordance with U.S. Generally Accepted Accounting Principles (GAAP). A reconciliation of the non-GAAP financial measures to their most directly comparable financial measures prepared in accordance with GAAP, accompanied by reasons why the Company believes the non-GAAP measures are important, are included in the attached schedules.
About Carpenter Technology
Carpenter Technology Corporation is a recognized leader in high-performance specialty alloy-based materials and process solutions for critical applications in the aerospace, defense, medical, transportation, energy, industrial, and consumer electronics markets. Founded in 1889, Carpenter Technology has evolved to become a pioneer in premium specialty alloys, including titanium, nickel, and cobalt, as well as alloys specifically engineered for additive manufacturing (AM) processes and soft magnetics applications. More information about Carpenter Technology can be found at www.carpentertechnology.com.
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, anticipated or implied. The most significant of these uncertainties are described in Carpenter Technology’s filings with the Securities and Exchange Commission, including its report on Form 10-K for the fiscal year ended June 30, 2023, Form 10-Q for the fiscal quarters ended September 30, 2023, December 31, 2023, and March 31, 2024, and the exhibits attached to such filings. They include but are not limited to: (1) the cyclical nature of the specialty materials business and certain end-use markets, including aerospace, defense, medical, transportation, energy, industrial and consumer, or other influences on Carpenter Technology’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; (2) the ability of Carpenter Technology to achieve cash generation, growth, earnings, profitability, operating income, cost savings and reductions, qualifications, productivity improvements or process changes; (3) the ability to recoup increases in the cost of energy, raw materials, freight or other factors; (4) domestic and foreign excess manufacturing capacity for certain metals; (5) fluctuations in currency exchange and interest rates; (6) the effect of government trade actions; (7) the valuation of the assets and liabilities in Carpenter Technology’s pension trusts and the accounting for pension plans; (8) possible labor disputes or work stoppages; (9) the potential that our customers may substitute alternate materials or adopt different manufacturing practices that replace or limit the suitability of our products; (10) the ability to successfully acquire and integrate acquisitions; (11) the availability of credit facilities to Carpenter Technology, its customers or other members of the supply chain; (12) the ability to obtain energy or raw materials, especially from suppliers located in countries that may be subject to unstable political or economic conditions; (13) Carpenter Technology’s manufacturing processes are dependent upon highly specialized equipment located primarily in facilities in Reading and Latrobe, Pennsylvania and Athens, Alabama for which there may be limited alternatives if there are significant equipment failures or a catastrophic event; (14) the ability to hire and retain a qualified workforce and key personnel, including members of the executive management team, management, metallurgists and other skilled personnel; (15) fluctuations in oil and gas prices and production; (16) the impact of potential cyber attacks and information technology or data security breaches; (17) the ability of suppliers to meet obligations due to supply chain disruptions or otherwise; (18) the ability to meet increased demand, production targets or commitments; (19) the ability to manage the impacts of natural disasters, climate change, pandemics and outbreaks of contagious diseases and other adverse public health developments; and (20) geopolitical, economic, and regulatory risks relating to our global business, including geopolitical and diplomatic tensions, instabilities and conflicts, such as the war in Ukraine, the war between Israel and HAMAS, and Houthi attacks on commercial shipping vessels and other naval vessels as well as compliance with U.S. and foreign trade and tax laws, sanctions, embargoes and other regulations. Any of these factors could have an adverse and/or fluctuating effect on Carpenter Technology’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 (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended. We caution you not to place undue reliance on forward-looking statements, which speak only as of the date of this press release or as of the dates otherwise indicated in such forward-looking statements. Carpenter Technology undertakes no obligation to update or revise any forward-looking statements.
| PRELIMINARY | |||||||||||
| CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||
| (in millions, except per share data) | |||||||||||
| (Unaudited) | |||||||||||
| Three Months Ended | Year Ended | ||||||||||
| June 30, | June 30, | ||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||
| NET SALES | $ | 798.7 | $ | 758.1 | $ | 2,759.7 | $ | 2,550.3 | |||
| Cost of sales | 608.1 | 639.1 | 2,175.4 | 2,213.0 | |||||||
| Gross profit | 190.6 | 119.0 | 584.3 | 337.3 | |||||||
| Selling, general and administrative expenses | 65.4 | 56.1 | 230.2 | 204.2 | |||||||
| Goodwill impairment charge | — | — | 14.1 | — | |||||||
| Restructuring and asset impairment charges | 16.9 | — | 16.9 | — | |||||||
| Operating income | 108.3 | 62.9 | 323.1 | 133.1 | |||||||
| Interest expense, net | 12.4 | 14.1 | 51.0 | 54.1 | |||||||
| Other expense, net | 2.0 | 0.2 | 60.5 | 6.5 | |||||||
| Income before income taxes | 93.9 | 48.6 | 211.6 | 72.5 | |||||||
| Income tax expense | 0.3 | 10.2 | 25.1 | 16.1 | |||||||
| NET INCOME | $ | 93.6 | $ | 38.4 | $ | 186.5 | $ | 56.4 | |||
| EARNINGS PER COMMON SHARE: | |||||||||||
| Basic | $ | 1.87 | $ | 0.78 | $ | 3.75 | $ | 1.15 | |||
| Diluted | $ | 1.85 | $ | 0.78 | $ | 3.70 | $ | 1.14 | |||
| WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: | |||||||||||
| Basic | 50.0 | 48.9 | 49.7 | 48.8 | |||||||
| Diluted | 50.6 | 49.4 | 50.3 | 49.2 | |||||||
| Cash dividends per common share | $ | 0.20 | $ | 0.20 | $ | 0.80 | $ | 0.80 | |||
| PRELIMINARY | |||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||
| (in millions) | |||||||
| (Unaudited) | |||||||
| Year Ended | |||||||
| June 30, | |||||||
| 2024 | 2023 | ||||||
| OPERATING ACTIVITIES | |||||||
| Net income | $ | 186.5 | $ | 56.4 | |||
| Adjustments to reconcile net income to net cash provided from operating activities: | |||||||
| Depreciation and amortization | 134.6 | 131.0 | |||||
| Goodwill impairment charge | 14.1 | — | |||||
| Noncash restructuring and asset impairment charges | 15.8 | — | |||||
| Deferred income taxes | (13.3 | ) | (0.4 | ) | |||
| Net pension expense | 76.0 | 19.9 | |||||
| Share-based compensation expense | 19.8 | 16.4 | |||||
| Net loss on disposal of property, plant, and equipment | 4.6 | 2.5 | |||||
| Changes in working capital and other: | |||||||
| Accounts receivable | (32.6 | ) | (144.5 | ) | |||
| Inventories | (96.7 | ) | (140.3 | ) | |||
| Other current assets | (31.3 | ) | 13.0 | ||||
| Accounts payable | (11.0 | ) | 29.2 | ||||
| Accrued liabilities | 23.6 | 38.2 | |||||
| Pension plan contributions | (11.3 | ) | — | ||||
| Other postretirement plan contributions | (2.6 | ) | (3.3 | ) | |||
| Other, net | (1.3 | ) | (3.4 | ) | |||
| Net cash provided from operating activities | 274.9 | 14.7 | |||||
| INVESTING ACTIVITIES | |||||||
| Purchases of property, plant, equipment and software | (96.6 | ) | (82.3 | ) | |||
| Proceeds from disposals of property, plant and equipment | 0.7 | — | |||||
| Net cash used for investing activities | (95.9 | ) | (82.3 | ) | |||
| FINANCING ACTIVITIES | |||||||
| Credit agreement borrowings | 62.5 | 183.7 | |||||
| Credit agreement repayments | (62.5 | ) | (183.7 | ) | |||
| Payments for debt issue costs | — | (1.9 | ) | ||||
| Dividends paid | (40.0 | ) | (39.4 | ) | |||
| Proceeds from stock options exercised | 40.9 | 5.0 | |||||
| Withholding tax payments on share-based compensation awards | (24.2 | ) | (3.8 | ) | |||
| Net cash used for financing activities | (23.3 | ) | (40.1 | ) | |||
| Effect of exchange rate changes on cash and cash equivalents | (1.1 | ) | (2.0 | ) | |||
| INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 154.6 | (109.7 | ) | ||||
| Cash and cash equivalents at beginning of year | 44.5 | 154.2 | |||||
| Cash and cash equivalents at end of year | $ | 199.1 | $ | 44.5 | |||
| PRELIMINARY | |||||||
| CONSOLIDATED BALANCE SHEETS | |||||||
| (in millions) | |||||||
| (Unaudited) | |||||||
| June 30, | |||||||
| 2024 | 2023 | ||||||
| ASSETS | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 199.1 | $ | 44.5 | |||
| Accounts receivable, net | 562.6 | 531.3 | |||||
| Inventories | 735.4 | 639.7 | |||||
| Other current assets | 94.1 | 66.4 | |||||
| Total current assets | 1,591.2 | 1,281.9 | |||||
| Property, plant, equipment and software, net | 1,335.2 | 1,383.8 | |||||
| Goodwill | 227.3 | 241.4 | |||||
| Other intangibles, net | 15.2 | 28.7 | |||||
| Deferred income taxes | 7.5 | 6.6 | |||||
| Other assets | 115.3 | 111.5 | |||||
| Total assets | $ | 3,291.7 | $ | 3,053.9 | |||
| LIABILITIES | |||||||
| Current liabilities: | |||||||
| Accounts payable | $ | 263.9 | $ | 278.1 | |||
| Accrued liabilities | 202.4 | 181.3 | |||||
| Total current liabilities | 466.3 | 459.4 | |||||
| Long-term debt | 694.2 | 693.0 | |||||
| Accrued pension liabilities | 207.6 | 190.1 | |||||
| Accrued postretirement benefits | 21.1 | 45.8 | |||||
| Deferred income taxes | 174.1 | 170.3 | |||||
| Other liabilities | 99.6 | 99.2 | |||||
| Total liabilities | 1,662.9 | 1,657.8 | |||||
| STOCKHOLDERS' EQUITY | |||||||
| Common stock | 284.9 | 280.7 | |||||
| Capital in excess of par value | 352.6 | 328.4 | |||||
| Reinvested earnings | 1,374.5 | 1,228.0 | |||||
| Common stock in treasury, at cost | (289.3 | ) | (298.0 | ) | |||
| Accumulated other comprehensive loss | (93.9 | ) | (143.0 | ) | |||
| Total stockholders' equity | 1,628.8 | 1,396.1 | |||||
| Total liabilities and stockholders' equity | $ | 3,291.7 | $ | 3,053.9 | |||
| PRELIMINARY | |||||||||||||||
| SEGMENT FINANCIAL DATA | |||||||||||||||
| (in millions, except pounds sold) | |||||||||||||||
| (Unaudited) | |||||||||||||||
| Three Months Ended | Year Ended | ||||||||||||||
| June 30, | June 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Pounds sold (‘000): | |||||||||||||||
| Specialty Alloys Operations | 57,204 | 61,528 | 208,154 | 212,050 | |||||||||||
| Performance Engineered Products | 2,856 | 3,328 | 10,094 | 11,864 | |||||||||||
| Intersegment | (3,278 | ) | (3,428 | ) | (11,946 | ) | (9,792 | ) | |||||||
| Consolidated pounds sold | 56,782 | 61,428 | 206,302 | 214,122 | |||||||||||
| Net sales: | |||||||||||||||
| Specialty Alloys Operations | |||||||||||||||
| Net sales excluding surcharge | $ | 559.5 | $ | 477.2 | $ | 1,876.0 | $ | 1,540.6 | |||||||
| Surcharge | 156.3 | 189.8 | 567.8 | 673.0 | |||||||||||
| Specialty Alloys Operations net sales | 715.8 | 667.0 | 2,443.8 | 2,213.6 | |||||||||||
| Performance Engineered Products | |||||||||||||||
| Net sales excluding surcharge | 102.3 | 107.6 | 377.8 | 397.1 | |||||||||||
| Surcharge | 8.9 | 11.1 | 33.2 | 36.6 | |||||||||||
| Performance Engineered Products net sales | 111.2 | 118.7 | 411.0 | 433.7 | |||||||||||
| Intersegment | |||||||||||||||
| Net sales excluding surcharge | (26.0 | ) | (24.8 | ) | (86.1 | ) | (89.7 | ) | |||||||
| Surcharge | (2.3 | ) | (2.8 | ) | (9.0 | ) | (7.3 | ) | |||||||
| Intersegment net sales | (28.3 | ) | (27.6 | ) | (95.1 | ) | (97.0 | ) | |||||||
| Consolidated net sales | $ | 798.7 | $ | 758.1 | $ | 2,759.7 | $ | 2,550.3 | |||||||
| Operating income (loss): | |||||||||||||||
| Specialty Alloys Operations | $ | 140.9 | $ | 80.0 | $ | 408.5 | $ | 179.1 | |||||||
| Performance Engineered Products | 10.6 | 5.9 | 36.0 | 31.8 | |||||||||||
| Corporate | (43.8 | ) | (22.5 | ) | (123.0 | ) | (75.5 | ) | |||||||
| Intersegment | 0.6 | (0.5 | ) | 1.6 | (2.3 | ) | |||||||||
| Consolidated operating income | $ | 108.3 | $ | 62.9 | $ | 323.1 | $ | 133.1 | |||||||
The Company has two reportable segments, Specialty Alloys Operations (“SAO”) and Performance Engineered Products (“PEP”).
The SAO segment is comprised of Carpenter’s major premium alloy and stainless steel manufacturing operations. This includes operations performed at mills primarily in Reading and Latrobe, Pennsylvania and surrounding areas as well as South Carolina and Alabama.
The PEP segment is comprised of the Company’s differentiated operations. This segment includes the Dynamet titanium business, the Carpenter Additive business and the Latrobe and Mexico distribution businesses. The businesses in the PEP segment are managed with an entrepreneurial structure to promote flexibility and agility to quickly respond to market dynamics. It is our belief this model will ultimately drive overall revenue and profit growth. The pounds sold data above for the PEP segment includes only the Dynamet and Additive businesses.
Corporate costs are comprised of executive and director compensation, and other corporate facilities and administrative expenses not allocated to the segments. Also included are items that management considers not representative of ongoing operations and other specifically-identified income or expense items.
The service cost component of net pension expense, which represents the estimated cost of future pension liabilities earned associated with active employees, is included in the operating results of the business segments. The residual net pension expense is included in other expense, net, and is comprised of the expected return on plan assets, interest costs on the projected benefit obligations of the plans, amortization of actuarial gains and losses and prior service costs, and pension settlement charges.
| PRELIMINARY | ||||||||||||||||
| NON-GAAP FINANCIAL MEASURES | ||||||||||||||||
| (in millions, except per share data) | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
| ADJUSTED OPERATING MARGIN EXCLUDING | Three Months Ended | Year Ended | ||||||||||||||
| SURCHARGE REVENUE AND SPECIAL ITEMS | June 30, | June 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Net sales | $ | 798.7 | $ | 758.1 | $ | 2,759.7 | $ | 2,550.3 | ||||||||
| Less: surcharge revenue | 162.9 | 198.1 | 592.0 | 702.3 | ||||||||||||
| Net sales excluding surcharge revenue | $ | 635.8 | $ | 560.0 | $ | 2,167.7 | $ | 1,848.0 | ||||||||
| Operating income | $ | 108.3 | $ | 62.9 | $ | 323.1 | $ | 133.1 | ||||||||
| Special items: | ||||||||||||||||
| Goodwill impairment charge | — | — | 14.1 | — | ||||||||||||
| Restructuring and asset impairment charges | 16.9 | — | 16.9 | — | ||||||||||||
| Adjusted operating income | $ | 125.2 | $ | 62.9 | $ | 354.1 | $ | 133.1 | ||||||||
| Operating margin | 13.6 | % | 8.3 | % | 11.7 | % | 5.2 | % | ||||||||
| Adjusted operating margin excluding surcharge revenue and special items | 19.7 | % | 11.2 | % | 16.3 | % | 7.2 | % | ||||||||
| ADJUSTED SEGMENT OPERATING MARGIN | Three Months Ended | Year Ended | ||||||||||||||
| EXCLUDING SURCHARGE REVENUE | June 30, | June 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Specialty Alloys Operations | ||||||||||||||||
| Net sales | $ | 715.8 | $ | 667.0 | $ | 2,443.8 | $ | 2,213.6 | ||||||||
| Less: surcharge revenue | 156.3 | 189.8 | 567.8 | 673.0 | ||||||||||||
| Net sales excluding surcharge revenue | $ | 559.5 | $ | 477.2 | $ | 1,876.0 | $ | 1,540.6 | ||||||||
| Operating income | $ | 140.9 | $ | 80.0 | $ | 408.5 | $ | 179.1 | ||||||||
| Operating margin | 19.7 | % | 12.0 | % | 16.7 | % | 8.1 | % | ||||||||
| Adjusted operating margin excluding surcharge revenue | 25.2 | % | 16.8 | % | 21.8 | % | 11.6 | % | ||||||||
| ADJUSTED SEGMENT OPERATING MARGIN | Three Months Ended | Year Ended | ||||||||||||||
| EXCLUDING SURCHARGE REVENUE | June 30, | June 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Performance Engineered Products | ||||||||||||||||
| Net sales | $ | 111.2 | $ | 118.7 | $ | 411.0 | $ | 433.7 | ||||||||
| Less: surcharge revenue | 8.9 | 11.1 | 33.2 | 36.6 | ||||||||||||
| Net sales excluding surcharge revenue | $ | 102.3 | $ | 107.6 | $ | 377.8 | $ | 397.1 | ||||||||
| Operating income | $ | 10.6 | $ | 5.9 | $ | 36.0 | $ | 31.8 | ||||||||
| Operating margin | 9.5 | % | 5.0 | % | 8.8 | % | 7.3 | % | ||||||||
| Adjusted operating margin excluding surcharge revenue | 10.4 | % | 5.5 | % | 9.5 | % | 8.0 | % | ||||||||
Management believes that removing the impact of raw material surcharge from operating margin provides a more consistent basis for comparing results of operations from period to period, thereby permitting management to evaluate performance and investors to make decisions based on the ongoing operations of the Company. In addition, management believes that excluding the impact of special items from operating margin is helpful in analyzing the operating performance of the Company, as these items are not indicative of ongoing operating performance. Management uses its results excluding these amounts to evaluate its operating performance and to discuss its business with investment institutions, the Company’s board of directors and others.
| Earnings | |||||||||||||||
| Before | Earnings Per | ||||||||||||||
| ADJUSTED EARNINGS PER DILUTED SHARE | Income | Income Tax | Diluted | ||||||||||||
| EXCLUDING SPECIAL ITEMS | Taxes | Expense | Net Income | Share* | |||||||||||
| Three months ended June 30, 2024, as reported | $ | 93.9 | $ | (0.3 | ) | $ | 93.6 | $ | 1.85 | ||||||
| Special items: | |||||||||||||||
| Restructuring and asset impairment charges | 16.9 | (0.1 | ) | 16.8 | 0.33 | ||||||||||
| US tax benefit related to restructuring activities | — | (18.4 | ) | (18.4 | ) | (0.36 | ) | ||||||||
| Three months ended June 30, 2024, as adjusted | $ | 110.8 | $ | (18.8 | ) | $ | 92.0 | $ | 1.82 | ||||||
| * Impact per diluted share calculated using weighted average common shares outstanding of 50.6 million for the three months ended June 30, 2024. | |||||||||||||||
| Earnings | |||||||||||||
| Before | Earnings Per | ||||||||||||
| ADJUSTED EARNINGS PER DILUTED SHARE | Income | Income Tax | Diluted | ||||||||||
| EXCLUDING SPECIAL ITEM | Taxes | Expense | Net Income | Share* | |||||||||
| Three months ended June 30, 2023, as reported | $ | 48.6 | $ | (10.2 | ) | $ | 38.4 | $ | 0.78 | ||||
| Special item: | |||||||||||||
| None reported | — | — | — | — | |||||||||
| Three months ended June 30, 2023, as adjusted | $ | 48.6 | $ | (10.2 | ) | $ | 38.4 | $ | 0.78 | ||||
| * Impact per diluted share calculated using weighted average common shares outstanding of 49.4 million for the three months ended June 30, 2023. | |||||||||||||
| Earnings | |||||||||||||||
| Before | Earnings Per | ||||||||||||||
| ADJUSTED EARNINGS PER DILUTED SHARE | Income | Income Tax | Diluted | ||||||||||||
| EXCLUDING SPECIAL ITEMS | Taxes | Expense | Net Income | Share* | |||||||||||
| Year ended June 30, 2024, as reported | $ | 211.6 | $ | (25.1 | ) | $ | 186.5 | $ | 3.70 | ||||||
| Special items: | |||||||||||||||
| Goodwill impairment charge | 14.1 | — | 14.1 | 0.28 | |||||||||||
| Restructuring and asset impairment charges | 16.9 | (0.1 | ) | 16.8 | 0.33 | ||||||||||
| Pension settlement charge | 51.9 | (12.4 | ) | 39.5 | 0.79 | ||||||||||
| US tax benefit related to restructuring activities | — | (18.4 | ) | (18.4 | ) | (0.36 | ) | ||||||||
| Year ended June 30, 2024, as adjusted | $ | 294.5 | $ | (56.0 | ) | $ | 238.5 | $ | 4.74 | ||||||
| * Impact per diluted share calculated using weighted average common shares outstanding of 50.3 million for the year ended June 30, 2024. | |||||||||||||||
| Earnings | |||||||||||||
| Before | Earnings Per | ||||||||||||
| ADJUSTED EARNINGS PER DILUTED SHARE | Income | Income Tax | Diluted | ||||||||||
| EXCLUDING SPECIAL ITEM | Taxes | Expense | Net Income | Share* | |||||||||
| Year ended June 30, 2023, as reported | $ | 72.5 | $ | (16.1 | ) | $ | 56.4 | $ | 1.14 | ||||
| Special item: | |||||||||||||
| None reported | — | — | — | — | |||||||||
| Year ended June 30, 2023, as adjusted | $ | 72.5 | $ | (16.1 | ) | $ | 56.4 | $ | 1.14 | ||||
| * Impact per diluted share calculated using weighted average common shares outstanding of 49.2 million for the year ended June 30, 2023. | |||||||||||||
Management believes that earnings per diluted share adjusted to exclude the impact of special items is helpful in analyzing the operating performance of the Company, as these items are not indicative of ongoing operating performance. Management uses its results excluding these amounts to evaluate its operating performance and to discuss its business with investment institutions, the Company’s board of directors and others.
| Three Months Ended | Year Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| ADJUSTED FREE CASH FLOW | 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Net cash provided from operating activities | $ | 169.5 | $ | 174.9 | $ | 274.9 | $ | 14.7 | ||||||||
| Purchases of property, plant, equipment and software | (27.7 | ) | (30.8 | ) | (96.6 | ) | (82.3 | ) | ||||||||
| Proceeds from disposals of property, plant and equipment | 0.6 | — | 0.7 | — | ||||||||||||
| Adjusted free cash flow | $ | 142.4 | $ | 144.1 | $ | 179.0 | $ | (67.6 | ) | |||||||
Management believes that the presentation of adjusted free cash flow provides useful information to investors regarding the Company’s financial condition because it is a measure of cash generated which management evaluates for alternative uses. It is management’s current intention to use excess cash to fund investments in capital equipment, acquisition opportunities and consistent dividend payments. Adjusted free cash flow is not a U.S. GAAP financial measure and should not be considered in isolation of, or as a substitute for, cash flows calculated in accordance with U.S. GAAP.
| PRELIMINARY | ||||||||||||
| SUPPLEMENTAL SCHEDULES | ||||||||||||
| (in millions) | ||||||||||||
| (Unaudited) | ||||||||||||
| Three Months Ended | Year Ended | |||||||||||
| June 30, | June 30, | |||||||||||
| NET SALES BY END-USE MARKET | 2024 | 2023 | 2024 | 2023 | ||||||||
| End-Use Market Excluding Surcharge Revenue: | ||||||||||||
| Aerospace and Defense | $ | 376.3 | $ | 294.2 | $ | 1,199.2 | $ | 919.5 | ||||
| Medical | 91.7 | 66.6 | 315.4 | 241.3 | ||||||||
| Transportation | 26.6 | 36.8 | 108.9 | 121.8 | ||||||||
| Energy | 36.5 | 34.8 | 130.4 | 104.3 | ||||||||
| Industrial and Consumer | 82.8 | 96.6 | 319.4 | 339.4 | ||||||||
| Distribution | 21.9 | 31.0 | 94.4 | 121.7 | ||||||||
| Total net sales excluding surcharge revenue | 635.8 | 560.0 | 2,167.7 | 1,848.0 | ||||||||
| Surcharge revenue | 162.9 | 198.1 | 592.0 | 702.3 | ||||||||
| Total net sales | $ | 798.7 | $ | 758.1 | $ | 2,759.7 | $ | 2,550.3 | ||||
| Investor Inquiries: John Huyette +1 610-208-2061 jhuyette@cartech.com | Media Inquiries: Heather Beardsley +1 610-208-2278 hbeardsley@cartech.com |
FAQ
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