Carpenter Technology Reports Second Quarter Fiscal Year 2025 Results
Carpenter Technology (NYSE: CRS) reported strong financial results for Q2 FY2025, with record second-quarter operating income of $118.9 million, up 70% year-over-year. The company achieved earnings per diluted share of $1.66 and generated $67.9 million in operating cash flow.
The Specialty Alloys Operations segment delivered impressive performance with $135.6 million in operating income and an adjusted operating margin of 28.3%, up from 20.0% in the previous year. The company executed $8.2 million in share repurchases against a $400.0 million authorization.
Looking ahead, Carpenter has increased its FY2025 outlook, projecting operating income between $500-520 million and adjusted free cash flow of $250-300 million. The company will host a virtual Investor Update Event on February 18, 2025, to discuss future growth prospects and market demand trends.
Carpenter Technology (NYSE: CRS) ha riportato risultati finanziari robusti per il secondo trimestre dell'anno fiscale 2025, con un reddito operativo record di 118,9 milioni di dollari, in aumento del 70% rispetto all'anno precedente. L'azienda ha registrato un utile per azione diluita di 1,66 dollari e generato un flusso di cassa operativo di 67,9 milioni di dollari.
Il segmento delle Operazioni di Leghe Speciali ha mostrato una performance impressionante con un reddito operativo di 135,6 milioni di dollari e un margine operativo rettificato del 28,3%, in crescita rispetto al 20,0% dell'anno precedente. L'azienda ha eseguito riacquisti di azioni per un totale di 8,2 milioni di dollari su un’autorizzazione di 400 milioni di dollari.
Guardando al futuro, Carpenter ha rivisto al rialzo le sue prospettive per l'anno fiscale 2025, prevedendo un reddito operativo compreso tra 500-520 milioni di dollari e un flusso di cassa libero rettificato di 250-300 milioni di dollari. L'azienda ospiterà un evento di aggiornamento per gli investitori virtuale il 18 febbraio 2025, per discutere delle prospettive di crescita future e delle tendenze della domanda di mercato.
Carpenter Technology (NYSE: CRS) reportó sólidos resultados financieros para el segundo trimestre del año fiscal 2025, con un ingreso operativo récord de 118,9 millones de dólares, un aumento del 70% en comparación con el año anterior. La compañía obtuvo ganancias por acción diluidas de 1,66 dólares y generó un flujo de caja operativo de 67,9 millones de dólares.
El segmento de Operaciones de Aleaciones Especiales mostró un rendimiento impresionante con 135,6 millones de dólares en ingresos operativos y un margen operativo ajustado del 28,3%, en comparación con el 20,0% del año anterior. La empresa llevó a cabo recompras de acciones por un total de 8,2 millones de dólares contra una autorización de 400 millones de dólares.
De cara al futuro, Carpenter ha aumentado su perspectiva para el año fiscal 2025, proyectando un ingreso operativo entre 500-520 millones de dólares y un flujo de caja libre ajustado de 250-300 millones de dólares. La compañía organizará un evento virtual de actualización para inversionistas el 18 de febrero de 2025, para discutir las perspectivas de crecimiento futuro y las tendencias de demanda del mercado.
카펜터 테크놀로지 (NYSE: CRS)는 2025 회계연도 2분기 강력한 재무 결과를 발표했으며, 기록적인 2분기 운영 수익 1억 1890만 달러를 기록하며 전년 대비 70% 증가했습니다. 이 회사는 희석 주당 순이익 1.66 달러를 달성하고 6790만 달러의 운영 현금 흐름을 창출했습니다.
전문 합금 작업 부문은 1억 3560만 달러의 운영 수익과 28.3%의 조정 운영 마진으로 인상적인 성과를 냈으며, 이는 전년도 20.0%에서 증가한 수치입니다. 이 회사는 4억 달러의 승인에 따라 820만 달러의 자사주 매입을 실행했습니다.
앞으로 카펜터는 2025 회계연도 전망을 상향 조정하여 운영 수익을 5억 - 5억 2000만 달러로 예상하며, 조정된 자유 현금 흐름을 2억 5000만 - 3억 달러로 예상하고 있습니다. 이 회사는 2025년 2월 18일에 향후 성장 전망 및 시장 수요 추세에 대해 논의하기 위해 가상 투자자 업데이트 행사를 개최할 예정입니다.
Carpenter Technology (NYSE: CRS) a annoncé de solides résultats financiers pour le deuxième trimestre de l'exercice 2025, avec un revenu d'exploitation record de 118,9 millions de dollars, en hausse de 70% par rapport à l'année précédente. La société a réalisé un bénéfice par action diluée de 1,66 dollar et a généré un flux de trésorerie d'exploitation de 67,9 millions de dollars.
Le segment des opérations sur alliages spéciaux a affiché une performance impressionnante avec un revenu d'exploitation de 135,6 millions de dollars et une marge d'exploitation ajustée de 28,3%, en hausse par rapport à 20,0% l'année précédente. L'entreprise a effectué des rachats d'actions pour un total de 8,2 millions de dollars sur une autorisation de 400 millions de dollars.
En regardant vers l'avenir, Carpenter a augmenté son outlook pour l'exercice 2025, prévoyant un revenu d'exploitation compris entre 500-520 millions de dollars et un flux de trésorerie libre ajusté de 250-300 millions de dollars. L'entreprise tiendra un événement virtuel de mise à jour pour les investisseurs le 18 février 2025, pour discuter des perspectives de croissance futures et des tendances de la demande sur le marché.
Carpenter Technology (NYSE: CRS) hat für das zweite Quartal des Geschäftsjahres 2025 starke finanzielle Ergebnisse vermeldet, mit einem Rekordbetriebseinkommen von 118,9 Millionen Dollar, was einem Anstieg von 70% im Vergleich zum Vorjahr entspricht. Das Unternehmen erzielte einen verwässerten Gewinn pro Aktie von 1,66 Dollar und generierte einen operativen Cashflow von 67,9 Millionen Dollar.
Das Segment der Speziallegierungen lieferte eine beeindruckende Leistung mit einem Betriebseinkommen von 135,6 Millionen Dollar und einer bereinigten Betriebsmarge von 28,3%, was einem Anstieg von 20,0% im Vorjahr entspricht. Das Unternehmen führte Aktienrückkäufe in Höhe von 8,2 Millionen Dollar im Rahmen einer Genehmigung von 400 Millionen Dollar durch.
Für die Zukunft hat Carpenter seine Prognose für das Geschäftsjahr 2025 angehoben und erwartet ein Betriebseinkommen zwischen 500-520 Millionen Dollar sowie einen bereinigten freien Cashflow von 250-300 Millionen Dollar. Das Unternehmen wird am 18. Februar 2025 eine virtuelle Investoren-Update-Veranstaltung veranstalten, um zukünftige Wachstumschancen und Marktbedarfs-Trends zu diskutieren.
- Record Q2 operating income of $118.9 million, up 70% YoY
- SAO segment operating margin expanded to 28.3% from 20.0% YoY
- Generated $67.9 million in operating cash flow
- Increased FY2025 operating income guidance to $500-520 million
- Strong liquidity position of $511.0 million
- 6% decrease in shipment volume
- Higher pension contributions in Q2 FY2025
Insights
Carpenter Technology's Q2 FY2025 results demonstrate exceptional operational execution and financial strength. The standout metrics include $118.9 million in operating income (70% YoY growth) and diluted EPS of
The SAO segment's performance is particularly noteworthy, with adjusted operating margins expanding to
- Product mix optimization toward higher-value materials
- Enhanced operational efficiencies
- Strategic pricing actions
The company's cash generation capabilities have strengthened significantly, with
- Share repurchases (
$8.2 million executed against$400 million authorization) - Sustained dividend payments
- Strategic capital expenditure (
$29.3 million )
The raised FY2025 guidance, targeting
With total liquidity of
Delivered Record Second Quarter Operating Income
Expanded Operating Margins in Specialty Alloys Operations Segment
Generated Positive Adjusted Free Cash Flow
Repurchased Shares Against Authorized Share Repurchase Program
Increased FY25 Outlook
Investor Event Scheduled
PHILADELPHIA, Jan. 30, 2025 (GLOBE NEWSWIRE) -- Carpenter Technology Corporation (NYSE: CRS) (the “Company”) today announced financial results for the fiscal second quarter ended December 31, 2024. For the quarter, the Company reported operating income of
Second Quarter Fiscal Year 2025 Highlights
- Delivered
$118.9 million of operating income, up 70 percent year-over-year and a record second quarter result - Realized earnings per diluted share of
$1.66 - Delivered adjusted operating margin of 28.3 percent in the Specialty Alloys Operations (“SAO”) segment, up from 20.0 percent in the second quarter of the previous year
- Achieved
$135.6 million of operating income in the SAO segment, up 63 percent year-over-year - Generated
$67.9 million of cash from operating activities, or$38.6 million of adjusted free cash flow - Executed
$8.2 million in share repurchases against$400.0 million repurchase authorization
Fiscal Year 2025 Outlook
- Increasing operating income expectations to the range of
$500 million to$520 million , up from the high end of the range of$460 million to$500 million - Projecting
$250 million to$300 million in adjusted free cash flow, which represents approximately 85 percent conversion rate - Anticipating between
$126 million and$134 million in operating income for the third quarter of fiscal year 2025 - Well-positioned for continued growth beyond fiscal year 2025 with strong market demand outlook for our broad portfolio of specialized solutions, and a focus on increasing productivity, optimizing product mix and pricing actions
Investor Update Event
- Will host virtual Investor Update Event on Tuesday, February 18, 2025, at 10:00 am ET
- Provide general business update, including:
- View of demand trends across end-use markets
- Status and review of commercial and operations initiatives
- Financial outlook beyond fiscal year 2025
“In the second quarter of fiscal year 2025 we delivered
“We continue to drive earnings momentum through improved productivity, product mix optimization and pricing actions. Notably, the SAO segment realized
“With the strong quarterly earnings, we generated
“Our outlook continues to strengthen. We anticipate earnings to continue to grow through fiscal year 2025, with total operating income in the range of
“Over the course of the last 9 months, we have pulled what was a four-year target in by two years into fiscal year 2025; and now we have increased our overall goal for fiscal year 2025. As we look ahead, we anticipate growth well beyond our fiscal year 2025 with strong demand for our highly specialized portfolio of products and our unique capacity and capabilities. We will provide a general update on the business, including demand across end-use markets and our operations, and detail our financial outlook beyond our fiscal year 2025 at an upcoming virtual investor update event, scheduled for February 18, 2025, at 10:00 am.”
“Carpenter Technology continues to exceed performance and outlook expectations. With continued growth, a strong balance sheet and meaningful adjusted free cash flow, we are well positioned to drive long-term value to shareholders. We will continue to take a balanced approach to capital allocation: sustaining our current asset base to achieve our targets, investing in incremental growth initiatives, and returning cash to shareholders.”
Financial Highlights
| Q2 | Q1 | Q2 | ||||||||
| ($ in millions, except per share amounts) | FY2025 | FY2025 | FY2024 | |||||||
| Net sales | $ | 676.9 | $ | 717.6 | $ | 624.2 | ||||
| Net sales excluding surcharge (a) | $ | 548.0 | $ | 577.4 | $ | 485.3 | ||||
| Operating income | $ | 118.9 | $ | 113.6 | $ | 69.8 | ||||
| Adjusted operating income excluding special item (a) | $ | 118.9 | $ | 117.2 | $ | 69.8 | ||||
| Net income | $ | 84.1 | $ | 84.8 | $ | 42.7 | ||||
| Earnings per diluted share | $ | 1.66 | $ | 1.67 | $ | 0.85 | ||||
| Adjusted earnings per diluted share (a) | $ | 1.66 | $ | 1.73 | $ | 0.85 | ||||
| Net cash provided from operating activities | $ | 67.9 | $ | 40.2 | $ | 14.6 | ||||
| Adjusted free cash flow (a) | $ | 38.6 | $ | 13.3 | $ | (10.7 | ) | |||
| (a) Non-GAAP financial measures explained in the attached tables | ||||||||||
Net sales for the second quarter of fiscal year 2025 were
Operating income was
Cash provided from operating activities in the second quarter of fiscal year 2025 was
Total liquidity, including cash and available revolver balance, was
Conference Call and Webcast Presentation
Carpenter Technology will host a conference call and webcast presentation today, January 30, 2025, at 10:00 a.m. ET, to discuss the financial results of operations for the second quarter of fiscal year 2025. 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 (https://www.carpentertechnology.com), and a replay will soon be made available at https://www.carpentertechnology.com. Presentation materials used during this conference call will be available for viewing and download at https://www.carpentertechnology.com.
Investor Update Event
Carpenter Technology will host a conference call and webcast presentation on February 18, 2025, at 10:00 a.m. ET, to provide a business update including market demand trends, manufacturing operations initiatives and long-term financial outlook. Access to the live webcast will be available at Carpenter Technology’s website (https://www.carpentertechnology.com), and a replay will be made available shortly after the event at https://www.carpentertechnology.com. Presentation materials used during the event will be available for viewing and download at https://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 materials and process solutions for critical applications in the aerospace and defense, medical, and other markets. Founded in 1889, Carpenter Technology has evolved to become a pioneer in premium specialty alloys including nickel, cobalt, and titanium and material process capabilities that solve our customers' current and future material challenges. More information about Carpenter Technology can be found at https://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, 2024, Form 10-Q for the fiscal quarter ended September 30, 2024, and the exhibits attached to those 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, energy, transportation, 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, including tariffs; (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; (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 and 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; (21) challenges affecting the commercial aviation industry or key participants including, but not limited to production and other challenges at The Boeing Company; and (22) the consequences of the announcement, maintenance or use of Carpenter Technology’s share repurchase program. 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 | Six Months Ended | |||||||||||
| December 31, | December 31, | |||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||
| NET SALES | $ | 676.9 | $ | 624.2 | $ | 1,394.5 | $ | 1,276.1 | ||||
| Cost of sales | 499.4 | 501.6 | 1,040.7 | 1,029.4 | ||||||||
| Gross profit | 177.5 | 122.6 | 353.8 | 246.7 | ||||||||
| Selling, general and administrative expenses | 58.6 | 52.8 | 117.7 | 107.9 | ||||||||
| Restructuring and asset impairment charges | — | — | 3.6 | — | ||||||||
| Operating income | 118.9 | 69.8 | 232.5 | 138.8 | ||||||||
| Interest expense, net | 12.2 | 13.0 | 24.6 | 25.7 | ||||||||
| Other expense, net | 1.6 | 1.6 | 1.6 | 5.5 | ||||||||
| Income before income taxes | 105.1 | 55.2 | 206.3 | 107.6 | ||||||||
| Income tax expense | 21.0 | 12.5 | 37.4 | 21.0 | ||||||||
| NET INCOME | $ | 84.1 | $ | 42.7 | $ | 168.9 | $ | 86.6 | ||||
| EARNINGS PER COMMON SHARE: | ||||||||||||
| Basic | $ | 1.68 | $ | 0.86 | $ | 3.37 | $ | 1.75 | ||||
| Diluted | $ | 1.66 | $ | 0.85 | $ | 3.33 | $ | 1.73 | ||||
| WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: | ||||||||||||
| Basic | 50.2 | 49.7 | 50.2 | 49.4 | ||||||||
| Diluted | 50.7 | 50.2 | 50.7 | 50.0 | ||||||||
| Cash dividends per common share | $ | 0.20 | $ | 0.20 | $ | 0.40 | $ | 0.40 | ||||
| PRELIMINARY CONSOLIDATED STATEMENTS OF CASH FLOWS (in millions) (Unaudited) | ||||||||
| Six Months Ended | ||||||||
| December 31, | ||||||||
| 2024 | 2023 | |||||||
| OPERATING ACTIVITIES | ||||||||
| Net income | $ | 168.9 | $ | 86.6 | ||||
| Adjustments to reconcile net income to net cash provided from operating activities: | ||||||||
| Depreciation and amortization | 68.1 | 66.7 | ||||||
| Noncash restructuring and asset impairment charges | 2.5 | — | ||||||
| Deferred income taxes | (8.4 | ) | (1.0 | ) | ||||
| Net pension expense | 12.4 | 11.8 | ||||||
| Share-based compensation expense | 9.8 | 8.5 | ||||||
| Net loss on disposals of property, plant and equipment | 0.5 | 1.2 | ||||||
| Changes in working capital and other: | ||||||||
| Accounts receivable | (6.1 | ) | 23.9 | |||||
| Inventories | (80.7 | ) | (157.5 | ) | ||||
| Other current assets | (6.8 | ) | (25.4 | ) | ||||
| Accounts payable | 3.6 | 37.8 | ||||||
| Accrued liabilities | (36.9 | ) | (26.8 | ) | ||||
| Pension plan contributions | (15.1 | ) | (4.8 | ) | ||||
| Other postretirement plan contributions | (1.8 | ) | (0.7 | ) | ||||
| Other, net | (1.9 | ) | 1.6 | |||||
| Net cash provided from operating activities | 108.1 | 21.9 | ||||||
| INVESTING ACTIVITIES | ||||||||
| Purchases of property, plant, equipment and software | (56.2 | ) | (47.3 | ) | ||||
| Net cash used for investing activities | (56.2 | ) | (47.3 | ) | ||||
| FINANCING ACTIVITIES | ||||||||
| Short-term credit agreement borrowings, net change | — | 13.9 | ||||||
| Credit agreement borrowings | — | 46.5 | ||||||
| Credit agreement repayments | — | (46.5 | ) | |||||
| Dividends paid | (20.2 | ) | (19.8 | ) | ||||
| Purchases of treasury stock | (40.3 | ) | — | |||||
| Proceeds from stock options exercised | 3.9 | 19.4 | ||||||
| Withholding tax payments on share-based compensation awards | (32.0 | ) | (18.0 | ) | ||||
| Net cash used for financing activities | (88.6 | ) | (4.5 | ) | ||||
| Effect of exchange rate changes on cash and cash equivalents | (0.3 | ) | 1.1 | |||||
| DECREASE IN CASH AND CASH EQUIVALENTS | (37.0 | ) | (28.8 | ) | ||||
| Cash and cash equivalents at beginning of year | 199.1 | 44.5 | ||||||
| Cash and cash equivalents at end of period | $ | 162.1 | $ | 15.7 | ||||
| PRELIMINARY CONSOLIDATED BALANCE SHEETS (in millions) (Unaudited) | ||||||||
| December 31, | June 30, | |||||||
| 2024 | 2024 | |||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 162.1 | $ | 199.1 | ||||
| Accounts receivable, net | 565.4 | 562.6 | ||||||
| Inventories | 812.0 | 735.4 | ||||||
| Other current assets | 100.8 | 94.1 | ||||||
| Total current assets | 1,640.3 | 1,591.2 | ||||||
| Property, plant, equipment and software, net | 1,325.2 | 1,335.2 | ||||||
| Goodwill | 227.3 | 227.3 | ||||||
| Other intangibles, net | 12.4 | 15.2 | ||||||
| Deferred income taxes | 7.6 | 7.5 | ||||||
| Other assets | 113.9 | 115.3 | ||||||
| Total assets | $ | 3,326.7 | $ | 3,291.7 | ||||
| LIABILITIES | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 266.9 | $ | 263.9 | ||||
| Accrued liabilities | 165.2 | 202.4 | ||||||
| Total current liabilities | 432.1 | 466.3 | ||||||
| Long-term debt | 694.8 | 694.2 | ||||||
| Accrued pension liabilities | 198.9 | 207.6 | ||||||
| Accrued postretirement benefits | 22.1 | 21.1 | ||||||
| Deferred income taxes | 166.7 | 174.1 | ||||||
| Other liabilities | 95.2 | 99.6 | ||||||
| Total liabilities | 1,609.8 | 1,662.9 | ||||||
| STOCKHOLDERS' EQUITY | ||||||||
| Common stock | 285.6 | 284.9 | ||||||
| Capital in excess of par value | 338.0 | 352.6 | ||||||
| Reinvested earnings | 1,523.2 | 1,374.5 | ||||||
| Common stock in treasury, at cost | (333.7 | ) | (289.3 | ) | ||||
| Accumulated other comprehensive loss | (96.2 | ) | (93.9 | ) | ||||
| Total stockholders' equity | 1,716.9 | 1,628.8 | ||||||
| Total liabilities and stockholders' equity | $ | 3,326.7 | $ | 3,291.7 | ||||
| PRELIMINARY SEGMENT FINANCIAL DATA (in millions, except pounds sold) (Unaudited) | |||||||||||||||
| Three Months Ended | Six Months Ended | ||||||||||||||
| December 31, | December 31, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Pounds sold ('000): | |||||||||||||||
| Specialty Alloys Operations | 44,714 | 50,114 | 94,814 | 100,104 | |||||||||||
| Performance Engineered Products | 2,208 | 2,318 | 4,840 | 4,620 | |||||||||||
| Intersegment | (752 | ) | (3,350 | ) | (1,916 | ) | (5,414 | ) | |||||||
| Consolidated pounds sold | 46,170 | 49,082 | 97,738 | 99,310 | |||||||||||
| Net sales: | |||||||||||||||
| Specialty Alloys Operations | |||||||||||||||
| Net sales excluding surcharge | $ | 479.6 | $ | 416.2 | $ | 990.5 | $ | 833.4 | |||||||
| Surcharge | 121.9 | 133.2 | 256.1 | 286.0 | |||||||||||
| Specialty Alloys Operations net sales | 601.5 | 549.4 | 1,246.6 | 1,119.4 | |||||||||||
| Performance Engineered Products | |||||||||||||||
| Net sales excluding surcharge | 86.2 | 87.9 | 178.5 | 181.0 | |||||||||||
| Surcharge | 8.8 | 7.8 | 17.3 | 16.4 | |||||||||||
| Performance Engineered Products net sales | 95.0 | 95.7 | 195.8 | 197.4 | |||||||||||
| Intersegment | |||||||||||||||
| Net sales excluding surcharge | (17.8 | ) | (18.8 | ) | (43.6 | ) | (36.3 | ) | |||||||
| Surcharge | (1.8 | ) | (2.1 | ) | (4.3 | ) | (4.4 | ) | |||||||
| Intersegment net sales | (19.6 | ) | (20.9 | ) | (47.9 | ) | (40.7 | ) | |||||||
| Consolidated net sales | $ | 676.9 | $ | 624.2 | $ | 1,394.5 | $ | 1,276.1 | |||||||
| Operating income (loss): | |||||||||||||||
| Specialty Alloys Operations | $ | 135.6 | $ | 83.3 | $ | 270.2 | $ | 164.1 | |||||||
| Performance Engineered Products | 7.0 | 7.1 | 14.3 | 16.2 | |||||||||||
| Corporate | (23.6 | ) | (20.7 | ) | (51.6 | ) | (42.0 | ) | |||||||
| Intersegment | (0.1 | ) | 0.1 | (0.4 | ) | 0.5 | |||||||||
| Consolidated operating income | $ | 118.9 | $ | 69.8 | $ | 232.5 | $ | 138.8 | |||||||
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.
| PRELIMINARY NON-GAAP FINANCIAL MEASURES (in millions, except per share data) (Unaudited) | ||||||||||||||||
| ADJUSTED OPERATING MARGIN EXCLUDING SURCHARGE REVENUE AND SPECIAL ITEM | Three Months Ended | Six Months Ended | ||||||||||||||
| December 31, | December 31, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Net sales | $ | 676.9 | $ | 624.2 | $ | 1,394.5 | $ | 1,276.1 | ||||||||
| Less: surcharge revenue | 128.9 | 138.9 | 269.1 | 298.0 | ||||||||||||
| Net sales excluding surcharge revenue | $ | 548.0 | $ | 485.3 | $ | 1,125.4 | $ | 978.1 | ||||||||
| Operating income | $ | 118.9 | $ | 69.8 | $ | 232.5 | $ | 138.8 | ||||||||
| Special item: | ||||||||||||||||
| Restructuring and asset impairment charges | — | — | 3.6 | — | ||||||||||||
| Adjusted operating income | $ | 118.9 | $ | 69.8 | $ | 236.1 | $ | 138.8 | ||||||||
| Operating margin | 17.6 | % | 11.2 | % | 16.7 | % | 10.9 | % | ||||||||
| Adjusted operating margin excluding surcharge revenue and special item | 21.7 | % | 14.4 | % | 21.0 | % | 14.2 | % | ||||||||
| ADJUSTED SEGMENT OPERATING MARGIN EXCLUDING SURCHARGE REVENUE | Three Months Ended | Six Months Ended | ||||||||||||||
| December 31, | December 31, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Specialty Alloys Operations | ||||||||||||||||
| Net sales | $ | 601.5 | $ | 549.4 | $ | 1,246.6 | $ | 1,119.4 | ||||||||
| Less: surcharge revenue | 121.9 | 133.2 | 256.1 | 286.0 | ||||||||||||
| Net sales excluding surcharge revenue | $ | 479.6 | $ | 416.2 | $ | 990.5 | $ | 833.4 | ||||||||
| Operating income | $ | 135.6 | $ | 83.3 | $ | 270.2 | $ | 164.1 | ||||||||
| Operating margin | 22.5 | % | 15.2 | % | 21.7 | % | 14.7 | % | ||||||||
| Adjusted operating margin excluding surcharge revenue | 28.3 | % | 20.0 | % | 27.3 | % | 19.7 | % | ||||||||
| ADJUSTED SEGMENT OPERATING MARGIN EXCLUDING SURCHARGE REVENUE | Three Months Ended | Six Months Ended | ||||||||||||||
| December 31, | December 31, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Performance Engineered Products | ||||||||||||||||
| Net sales | $ | 95.0 | $ | 95.7 | $ | 195.8 | $ | 197.4 | ||||||||
| Less: surcharge revenue | 8.8 | 7.8 | 17.3 | 16.4 | ||||||||||||
| Net sales excluding surcharge revenue | $ | 86.2 | $ | 87.9 | $ | 178.5 | $ | 181.0 | ||||||||
| Operating income | $ | 7.0 | $ | 7.1 | $ | 14.3 | $ | 16.2 | ||||||||
| Operating margin | 7.4 | % | 7.4 | % | 7.3 | % | 8.2 | % | ||||||||
| Adjusted operating margin excluding surcharge revenue | 8.1 | % | 8.1 | % | 8.0 | % | 9.0 | % | ||||||||
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.
| ADJUSTED EARNINGS PER SHARE EXCLUDING SPECIAL ITEM | Earnings Before Income Taxes | Income Tax Expense | Net Income | Earnings Per Diluted Share* | |||||||||
| Three Months Ended December 31, 2024, as reported | $ | 105.1 | $ | (21.0 | ) | $ | 84.1 | $ | 1.66 | ||||
| Special item: | |||||||||||||
| None reported | — | — | — | — | |||||||||
| Three Months Ended December 31, 2024, as adjusted | $ | 105.1 | $ | (21.0 | ) | $ | 84.1 | $ | 1.66 | ||||
| * Impact per diluted share calculated using weighted average common shares outstanding of 50.7 million for the three months ended December 31, 2024. | |||||||||||||
| ADJUSTED EARNINGS PER SHARE EXCLUDING SPECIAL ITEM | Earnings Before Income Taxes | Income Tax Expense | Net Income | Earnings Per Diluted Share* | |||||||||
| Three Months Ended December 31, 2023, as reported | $ | 55.2 | $ | (12.5 | ) | $ | 42.7 | $ | 0.85 | ||||
| Special item: | |||||||||||||
| None reported | — | — | — | — | |||||||||
| Three Months Ended December 31, 2023, as adjusted | $ | 55.2 | $ | (12.5 | ) | $ | 42.7 | $ | 0.85 | ||||
| * Impact per diluted share calculated using weighted average common shares outstanding of 50.2 million for the three months ended December 31, 2023. | |||||||||||||
| ADJUSTED EARNINGS PER SHARE EXCLUDING SPECIAL ITEM | Earnings Before Income Taxes | Income Tax Expense | Net Income | Earnings Per Diluted Share* | |||||||||
| Six Months Ended December 31, 2024, as reported | $ | 206.3 | $ | (37.4 | ) | $ | 168.9 | $ | 3.33 | ||||
| Special item: | |||||||||||||
| Restructuring and asset impairment charges | 3.6 | (0.9 | ) | 2.7 | 0.06 | ||||||||
| Six Months Ended December 31, 2024, as adjusted | $ | 209.9 | $ | (38.3 | ) | $ | 171.6 | $ | 3.39 | ||||
| * Impact per diluted share calculated using weighted average common shares outstanding of 50.7 million for the six months ended December 31, 2024. | |||||||||||||
| ADJUSTED EARNINGS PER SHARE EXCLUDING SPECIAL ITEMS | Earnings Before Income Taxes | Income Tax Expense | Net Income | Earnings Per Diluted Share* | |||||||||
| Six Months Ended December 31, 2023, as reported | $ | 107.6 | $ | (21.0 | ) | $ | 86.6 | $ | 1.73 | ||||
| Special item: | |||||||||||||
| None reported | — | — | — | — | |||||||||
| Six Months Ended December 31, 2023, as adjusted | $ | 107.6 | $ | (21.0 | ) | $ | 86.6 | $ | 1.73 | ||||
| * Impact per diluted share calculated using weighted average common shares outstanding of 50.0 million for the six months ended December 31, 2023. | |||||||||||||
Management believes that earnings per share adjusted to exclude the impact of the 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 | Six Months Ended | |||||||||||||||
| December 31, | December 31, | |||||||||||||||
| ADJUSTED FREE CASH FLOW | 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Net cash provided from operating activities | $ | 67.9 | $ | 14.6 | $ | 108.1 | $ | 21.9 | ||||||||
| Purchases of property, plant, equipment and software | (29.3 | ) | (25.3 | ) | (56.2 | ) | (47.3 | ) | ||||||||
| Adjusted free cash flow | $ | 38.6 | $ | (10.7 | ) | $ | 51.9 | $ | (25.4 | ) | ||||||
Management believes that the presentation of adjusted free cash flow provides useful information to investors regarding our 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. Additionally, we will discretionarily use excess cash to fund share repurchases of our outstanding common stock. 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 SCHEDULE (in millions) (Unaudited) | ||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||
| December 31, | December 31, | |||||||||||
| NET SALES BY END-USE MARKET | 2024 | 2023 | 2024 | 2023 | ||||||||
| End-Use Market Excluding Surcharge Revenue: | ||||||||||||
| Aerospace and Defense | $ | 333.8 | $ | 246.7 | $ | 683.7 | $ | 507.8 | ||||
| Medical | 73.4 | 73.0 | 146.8 | 139.5 | ||||||||
| Energy | 32.2 | 36.8 | 71.6 | 66.0 | ||||||||
| Transportation | 21.4 | 26.8 | 42.5 | 56.0 | ||||||||
| Industrial and Consumer | 67.4 | 80.2 | 139.8 | 159.6 | ||||||||
| Distribution | 19.8 | 21.8 | 41.0 | 49.2 | ||||||||
| Total net sales excluding surcharge revenue | 548.0 | 485.3 | 1,125.4 | 978.1 | ||||||||
| Surcharge revenue | 128.9 | 138.9 | 269.1 | 298.0 | ||||||||
| Total net sales | $ | 676.9 | $ | 624.2 | $ | 1,394.5 | $ | 1,276.1 | ||||
| Investor Inquiries: John Huyette +1 610-208-2061 jhuyette@cartech.com | Media Inquiries: Heather Beardsley +1 610-208-2278 hbeardsley@cartech.com |
FAQ
What was Carpenter Technology's (CRS) Q2 FY2025 earnings per share?
How much operating income did CRS generate in Q2 FY2025?
What is Carpenter Technology's (CRS) free cash flow guidance for FY2025?
How much did CRS spend on share repurchases in Q2 FY2025?
What is the operating margin for CRS's Specialty Alloys Operations in Q2 FY2025?
