Carpenter Technology Reports Second Quarter Results.Business Editors WYOMISSING, Pa.--(BUSINESS WIRE)--Jan. 21, 2003 Carpenter Technology Corporation Carpenter Technology Corporation (NYSE:CRS) is a leading manufacturer and distributor of specialty alloys, including stainless steel and titanium, and various engineered products made from metallic and ceramic materials. (NYSE NYSE See: New York Stock Exchange :CRS CRS Course CRS Certified Residential Specialist (real estate certification) CRS Central Reservation System CRS Can't Remember Stuff (polite form) CRS Cost Reduction Strategy CRS Consumer Relations Specialist ) today reported a fiscal second quarter loss after a special charge but continued to generate free cash flow and strengthen its balance sheet. Net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight for the second fiscal quarter ended December December: see month. 31, 2002 were $210.2 million compared to $248.1 million for the same period a year ago. The second quarter net loss was $7.1 million or $.34 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, compared to net income of $3.5 million or $.14 per diluted share a year ago. The second quarter loss included an after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. special charge of $7.7 million or $.35 per diluted share related primarily to severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when and pension related costs of an early retirement program for certain production and maintenance employees. The special charge will not materially affect Carpenter's operating cash flow Operating cash flow Earnings before depreciation minus taxes. Measures the cash generated from operations, not counting capital spending or working capital requirements. since the costs will be funded predominately from the company's overfunded pension plan Overfunded pension plan A pension plan that has a positive surplus (i.e., assets exceed liabilities). . The second quarter early retirement of certain production and maintenance employees is part of the 10% workforce reduction initiative announced by Carpenter on September September: see month. 30, 2002. The company said then that the workforce reductions, combined with other cost savings initiatives, should result in annual savings of $40 - $45 million. The second quarter of fiscal 2003 included income of $2.5 million, or the equivalent of $.07 per diluted share, received from U.S. Customs under the "Continued Dumping dumping, selling goods at less than the normal price, usually as exports in international trade. It may be done by a producer, a group of producers, or a nation. and Subsidy subsidy, financial assistance granted by a government or philanthropic foundation to a person or association for the purpose of promoting an enterprise considered beneficial to the public welfare. Offset Act of 2000." Last year in the second quarter, Carpenter received $3.5 million, or the equivalent of $.09 per diluted share, under this program. Also included in the second quarter for this fiscal year was $1.9 million, or the equivalent of $.05 per diluted share, related to the favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. adjustment of a quality reserve and the settlement of an insurance claim. Free cash flow, defined as net cash provided before financing activities but after dividends, was $17.4 million in the second quarter versus $10.7 million a year ago. At the end of the second quarter, total debt, net of cash and including amounts outstanding under the company's receivables Receivables An asset designation applicable to all debts, unsettled transactions or other monetary obligations owed to a company by its debtors or customers. Receivables are recorded by a company's accountants and reported on the balance sheet, and they and include all debts owed purchase facility, was reduced to $401.1 million. Carpenter's net debt amount is $17.4 million lower than at the end of the previous quarter and $98.1 million lower than a year ago. First Half Results Net sales for the first six months of the current fiscal year were $424.1 million compared with last year's level of $499.3 million. The net loss, including special charges, was $18.0 million or $.85 per diluted share. Carpenter incurred special charges after-tax totaling $16.2 million or $.73 per diluted share in the first six months of fiscal 2003. For the first six months a year ago, Carpenter had a net loss of $102.9 million or $4.68 per diluted share. The first quarter a year ago had a $112.3 million charge, or $5.06 per diluted share, related to the adoption of Statement of Financial Accounting Standards No. 142, "Goodwill and Other Intangible Assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. ." For the first six-months of this fiscal year, the company generated $25.7 million of free cash flow versus $17.0 million for the same period a year ago, after adjusting for the effects of the receivables purchase facility. Operating Summary "As anticipated, the manufacturing environment remained challenging during our second fiscal quarter," said Dennis Dennis is a male first name derived from the Greco-Roman name Dionysius meaning "servant of Dionysus", the Thracian god of wine, which is ultimately derived from the Greek Dios (Διος, "of Zeus") combined with Nysos or Nysa (Νυσα), where the M. Draeger, chairman and chief executive officer. "Although we experienced increased volume in some market segments from a year ago, weak demand in key markets such as aerospace and power generation adversely affected operating margins Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: . "In our first quarter, we took aggressive cost reduction actions to regain profitability, continue to generate free cash flow and pay down debt. We believe that our actions will allow us to be profitable in the second half of our fiscal year and generate free cash flow in excess of $40 million for the current fiscal year." The decline in second quarter sales from a year ago primarily reflected reduced demand for certain high temperature alloys This is a list of alloys for which an article exists in Wikipedia (or is proposed but not yet written). They are grouped by base metal, in order of increasing atomic number. Within these headings they are in no particular order. , titanium alloys Titanium alloys are metallic materials which contain a mixture of titanium and other chemical elements. Such alloys have very high tensile strength and toughness (even at extreme temperatures), light weight, extraordinary corrosion resistance, and ability to withstand extreme and ceramic This article is about ceramic materials. For the fine art, see Ceramic art. The word ceramic is derived from the Greek word κεραμικός (keramikos). products due to lower build rates of commercial aircraft and industrial gas turbines. Demand for these materials was further affected by supply chain inventory adjustments. Partially offsetting the decline in these markets were volume increases for stainless steel stainless steel: see steel. stainless steel Any of a family of alloy steels usually containing 10–30% chromium. The presence of chromium, together with low carbon content, gives remarkable resistance to corrosion and heat. sold to customers serving several consumer and industrial markets. Tons sold into these two markets increased more than 35% in the second quarter versus the same quarter a year ago. Despite higher volumes in its stainless steel operations from a year ago, Carpenter's overall operating margins were affected by reduced demand for higher value materials sold into the aerospace and power generation markets. Further, excess global stainless steel capacity and the availability of low priced imported stainless bar, rod and wire continued to place downward pressure on pricing. "In this increasingly competitive global environment, it is imperative imperative: see mood. imperative - imperative language that we further improve our operating efficiencies through process improvements and lean Six Sigma Lean Six Sigma is a business improvement methodology which combines (as the name implies) tools from both Lean Manufacturing and Six Sigma. Lean manufacturing focuses on speed and traditional Six Sigma focuses on quality. By combining the two, the result is better quality faster. practices," Draeger said. "Our actions during this cyclical cyclical Of or relating to a variable, such as housing starts, car sales, or the price of a certain stock, that is subject to regular or irregular up-and-down movements. downturn Downturn The transition point between a rising, expanding economy to a falling, contracting one. downturn A decline in security prices or economic activity following a period of rising or stable prices or activity. should enhance our profitability as the U.S. manufacturing sector recovers." Based on current market conditions, Carpenter expects to be profitable in the second half of its fiscal year (ending June June: see month. 30), driven primarily by the cost reduction initiatives it has undertaken. Segment Results - Second Quarter Specialty Metals Net sales for the quarter ended December 31, 2002 for the Specialty Metals segment, which includes the Specialty Alloys Operations (SAO Sa´o n. 1. (Zool.) Any marine annelid of the genus Hyalinæcia, especially H. tubicola of Europe, which inhabits a transparent movable tube resembling a quill in color and texture. ), Dynamet, and Carpenter Powder Products (CPP cpp - C preprocessor. ) business units, were $178.9 million or $36.3 million lower than in the same quarter a year ago. SAO sales decreased by 16 percent due to a significantly weaker sales mix sales mix See product mix. and reduced selling prices. SAO volume was eight percent higher than last year due mainly to increased sales of lower value stainless wire and rod products. However, the weaker sales mix that resulted, combined with decreased shipment levels of higher value special alloys to the aerospace and power generation markets and sustained pricing pressures on stainless products, adversely impacted sales. Dynamet's sales decreased 38 percent in the second quarter versus a year ago, due primarily to lower volumes to the aerospace market. CPP's sales were 16 percent higher than a year ago due primarily to increased sales in Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). .
Operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. for the Specialty Metals segment was $4.8 million, which was $3.6 million lower than last year. This decrease was due primarily to SAO's weaker sales mix and Dynamet's reduced sales volumes, partially offset by improved operating efficiencies, lower costs and the favorable adjustment of a quality reserve. Engineered Products Segment Net sales for this segment, which includes sales of fabricated fab·ri·cate tr.v. fab·ri·cat·ed, fab·ri·cat·ing, fab·ri·cates 1. To make; create. 2. To construct by combining or assembling diverse, typically standardized parts: metal and ceramic components, were $31.6 million as compared to $33.7 million a year ago. Last year's second quarter included $1.0 million in sales from businesses that were subsequently divested. The Engineered Products segment was largely affected by a slowdown For articles with similar titles, see Slow Down (disambiguation). A slowdown is an industrial action in which employees perform their duties but seek to reduce productivity or efficiency in their performance of these duties. in the aerospace and industrial gas turbine turbine, rotary engine that uses a continuous stream of fluid (gas or liquid) to turn a shaft that can drive machinery. A water, or hydraulic, turbine is used to drive electric generators in hydroelectric power stations. markets. The operating income for the Engineered Products segment was $4.4 million in the second quarter versus $2.0 million a year ago. The increase in operating income primarily reflects the benefit of cost savings initiatives and the settlement of an insurance claim. Segment Results - Year-to-Date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. Specialty Metals Net sales for the first six months of fiscal 2003 for the Specialty Metals segment were $364.9 million or $66.0 million lower than the same period a year ago. SAO sales decreased by 14 percent from a year ago due to a weaker sales mix and reduced selling prices. SAO volume was 11 percent higher than last year due mainly to increased sales of lower value stainless wire and rod products. The weaker sales mix combined with decreased shipment levels of higher value special alloys and sustained pricing pressures on stainless products, adversely impacted sales. Dynamet's sales decreased 38 percent during the first six months versus the same period a year ago. The decline in sales is due primarily to lower volumes sold to the aerospace market. CPP's sales were seven percent higher than a year ago due primarily to increased sales in Europe. Operating income for the Specialty Metals segment was $7.7 million during the first six months of fiscal 2003, which was $13.0 million lower than last year. This decrease was due primarily to SAO's weaker sales mix and Dynamet's reduced sales volumes, partially offset by improved operating efficiencies, lower costs and the favorable adjustment of a quality reserve. Engineered Products Segment Net sales for this segment through the first six months of fiscal 2003 were $60.1 million as compared to $69.4 million for the same period a year ago. The six month period a year ago included $2.7 million from businesses that were subsequently divested. This group of companies was largely affected by a slowdown in the aerospace and industrial gas turbine markets. The operating income for the Engineered Products segment for the first six months of fiscal 2003 was $6.6 million versus $5.9 million for the same period a year ago. The increase in operating income primarily reflects the benefit of cost savings initiatives and the settlement of an insurance claim. Net Pension Credit The net pension credit represents income relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc Carpenter's overfunded defined benefit pension plan, less the expense for post-retirement medical benefits and other underfunded un·der·fund tr.v. un·der·fund·ed, un·der·fund·ing, un·der·funds To provide insufficient funding for. underfunded adj → infradotado (económicamente) defined benefit pension plans. The net pension credit was $0.6 million in the second quarter versus $4.3 million last year. For the first six months of the current fiscal year, the net pension credit was $1.5 million versus $8.5 million for the same period a year ago. The net pension credit is chiefly a result of the overfunded position of Carpenter's largest defined benefit pension plan. The lower level of the net pension credit versus the prior year was due primarily to the equity markets' investment losses on the pension and post-retirement plan assets as of June 30, 2002. Special Charges In the second quarter of fiscal 2003, Carpenter incurred an after-tax special charge of $7.7 million or $.35 per diluted share. The charge is related to costs for severance payments and enhanced pension benefits associated with the early retirement of certain production and maintenance employees and pension related costs due to the retirements and terminations in fiscal 2003. For the first six months of fiscal 2003, Carpenter incurred after-tax special charges of $16.2 million or $.73 per diluted share. The charges in the first and second quarter were predominantly pre·dom·i·nant adj. 1. Having greatest ascendancy, importance, influence, authority, or force. See Synonyms at dominant. 2. non-cash. Other Comments In the second quarter of fiscal 2003, selling and administrative expenses of $30.5 million were lower than last year by $5.6 million or 16 percent. For the first six months, selling and administrative expenses of $62.2 million were $10.6 million or 15 percent lower than the same period a year ago. The favorable impacts of lower salary and benefits, depreciation and amortization, and professional fees were partially offset by the reduced net pension credit. For the most recent second quarter, interest expense of $7.8 million was $1.3 million lower than last year due to lower debt levels and lower interest rates. For the first six months of fiscal 2003, interest expense was $15.8 million or $2.2 million lower than the same period a year ago. Cash Flow and Liquidity Carpenter has maintained the ability to provide cash to meet its needs through cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses , management of working capital and the flexibility to use outside sources of financing to supplement internally generated funds. Free cash flow for the second quarter was $17.4 million versus $10.7 million a year ago. For the six-month period ended December 31, 2002, free cash flow was $25.7 million versus $17.0 million for the same period a year ago, after adjusting for the effects of the receivables purchase facility. Carpenter believes that its current financial resources, both from internal and external sources, will be more than adequate to meet its foreseeable fore·see tr.v. fore·saw , fore·seen , fore·see·ing, fore·sees To see or know beforehand: foresaw the rapid increase in unemployment. needs. At the end of the second quarter, Carpenter had approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $125 million available under its credit facilities credit facilities npl → facilidades fpl de crédito credit facilities npl → facilités fpl de paiement credit facilities . Labor Relations Carpenter also said that on December 16, 2002 it received notice from the National Labor Relations Board National Labor Relations Board (NLRB), independent agency of the U.S. government created under the National Labor Relations Act of 1935 (Wagner Act), and amended by the acts of 1947 (Taft-Hartley Labor Act) and 1959 (Landrum-Griffin Act), which affirmed labor's right (NLRB) that the United Automobile automobile, self-propelled vehicle used for travel on land. The term is commonly applied to a four-wheeled vehicle designed to carry two to six passengers and a limited amount of cargo, as contrasted with a truck, which is designed primarily for the transportation of , Aerospace, and Agricultural Implementation Workers of America America [for Amerigo Vespucci], the lands of the Western Hemisphere—North America, Central (or Middle) America, and South America. The world map published in 1507 by Martin Waldseemüller is the first known cartographic use of the name. (UAW (spelling) UAW - Misspelling of "IAW"? ) had withdrawn its request for an election to represent production and maintenance employees at Carpenter's Reading, Pa. facility for collective bargaining collective bargaining, in labor relations, procedure whereby an employer or employers agree to discuss the conditions of work by bargaining with representatives of the employees, usually a labor union. . The UAW had filed a petition petition Written instrument directed to an individual, government official, legislative body, or court in order to seek redress of grievances or to request a favour. on October October: see month. 23, 2002 with the NLRB to seek the election at the Reading facility. This facility had previous unsuccessful organizing activities by various unions. Conference Call Carpenter will host a conference call and webcast on Tuesday Tuesday: see week. , January January: see month. 21, at 10 a.m., Eastern Time, to discuss the results of operations for the second quarter. Carpenter produces and distributes specialty materials, including stainless steels, titanium alloys, superalloys and various engineered products. Information about Carpenter can be found on the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the at www.cartech.com, with selected products sold online at www.carpenterdirect.com. Except for historical information, all other information in this news release consists of forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. within the meaning of the Private Securities Litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called 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 Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. . The most significant of these uncertainties are described in Carpenter's filings with the Securities and Exchange Commission including its report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended June 30, 2002, its Form 10-Q Form 10-Q See 10-Q. for the first quarter and its most recent registration statement on Form S-4, filed on October 12, 2001, as amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. on November November: see month. 29, 2001. They include but are not limited to: 1) the cyclical nature of the specialty materials business and certain end-use markets, including aerospace, power generation, automotive and consumer durables Consumer durables Consumer products that are expected to last three years or more, such as an automobile or a home appliance. consumer durables See durable goods. , which are subject to changes in general economic and financial market conditions; 2) the ability of Carpenter to recoup recoup To sell an asset at a price sufficient to recover the original outlay or to offset a previous loss. increased costs of electricity, natural gas and raw materials, such as nickel nickel, metallic chemical element; symbol Ni; at. no. 28; at. wt. 58.69; m.p. about 1,453°C;; b.p. about 2,732°C;; sp. gr. 8.902 at 25°C;; valence 0, +1, +2, +3, or +4. , through increased prices and surcharges; 3) worldwide excess manufacturing capacity for certain alloys that Carpenter produces; 4) fluctuations in currency exchange rates, resulting in increased competition and downward pricing pressure on certain Carpenter products; 5) the degree of success of government trade actions; and 6) fluctuations in stock markets that could impact the valuation of the assets in Carpenter's pension trusts and the accounting for pension assets. Carpenter undertakes no obligation to update or revise any forward-looking statements.
CONSOLIDATED STATEMENT OF OPERATIONS
(in Millions, Except per Share Data)
Three Months Six Months
Ended Ended
December 31 December 31
-------------- ---------------
2002 2001 2002 2001
------- ------ ------ --------
NET SALES $210.2 $248.1 $424.1 $499.3
------- ------ ------ --------
COSTS AND EXPENSES:
Cost of sales 174.3 201.6 354.6 399.9
Selling and administrative expenses 30.5 36.1 62.2 72.8
Special charge 12.9 -- 27.0 --
Interest expense 7.8 9.1 15.8 18.0
Other income, net (3.1) (3.3) (3.3) (5.0)
------- ------ ------ --------
222.4 243.5 456.3 485.7
------- ------ ------ --------
Income (loss) before income taxes (12.2) 4.6 (32.2) 13.6
Income taxes (benefit) (5.1) 1.1 (14.2) 4.2
------- ------ ------ --------
Net income (loss) before cumulative
effect of accounting change (7.1) 3.5 (18.0) 9.4
Cumulative effect of accounting change -- -- -- (112.3)
------- ------ ------ --------
NET INCOME (LOSS) ($7.1) $3.5 ($18.0)($102.9)
======= ====== ====== ========
EARNINGS (LOSS) PER COMMON SHARE:
Basic:
Income (loss) before cumulative
effect
of accounting changes ($0.34) $0.14 ($0.85) $0.38
Cumulative effect of accounting
changes -- -- -- (5.06)
------- ------ ------ --------
Net earnings (loss) ($0.34) $0.14 ($0.85) ($4.68)
======= ====== ====== ========
Diluted:
Income (loss) before cumulative
effect
of accounting changes ($0.34) $0.14 ($0.85) $0.38
Cumulative effect of accounting
changes -- -- -- (5.06)
------- ------ ------ --------
Net earnings (loss) ($0.34) $0.14 ($0.85) ($4.68)
======= ====== ====== ========
WEIGHTED AVERAGE COMMON
SHARES OUTSTANDING
Basic 22.3 22.2 22.3 22.2
======= ====== ====== ========
Diluted 22.3 23.0 22.3 22.2
======= ====== ====== ========
Cash dividends per common share $0.0825 $0.33 $0.4125 $0.66
======= ====== ====== ========
Certain reclassifications of prior year's amounts have been made
to conform with current year's presentation.
PRELIMINARY
CONSOLIDATED STATEMENT OF CASH FLOWS
(in Millions)
Six Months Ended
December 31
----------------
2002 2001
------- --------
OPERATIONS:
Net loss ($18.0) ($102.9)
Adjustments to reconcile net loss to
net cash provided from operations:
Depreciation 27.3 28.2
Amortization of intangible assets 4.6 6.4
Goodwill impairment charge -- 112.3
Deferred income taxes (6.7) 1.9
Net pension credit (1.8) (8.6)
Net loss on asset disposals 0.6 0.2
Special charge 25.6 --
Changes in working capital and other:
Receivables 25.0 40.2
Net change in accounts receivable purchase
facility -- 45.0
Inventories (2.1) (14.3)
Accounts payable (9.2) (13.7)
Accrued current liabilities (4.3) 2.3
Income tax refund 11.2 7.0
Other, net (11.9) (11.1)
------- --------
Net cash provided from operations 40.3 92.9
------- --------
INVESTING ACTIVITIES:
Purchases of plant, equipment and software (5.3) (15.9)
Proceeds from sale of business -- 0.2
Proceeds from disposals of plant and equipment 0.7 0.3
------- --------
Net cash used for investing activities (4.6) (15.4)
------- --------
NET CASH PROVIDED BEFORE FINANCING ACTIVITIES 35.7 77.5
------- --------
FINANCING ACTIVITIES:
Change in short-term debt (0.9) (145.0)
Proceeds from issuance of long-term debt -- 98.4
Payments on long-term debt (1.1) (15.5)
Dividends paid (10.0) (15.5)
Proceeds from issuance of common stock -- 0.3
------- --------
Net cash used for financing activities (12.0) (77.3)
------- --------
INCREASE IN CASH AND CASH EQUIVALENTS 23.7 0.2
Cash and cash equivalents at beginning of period 18.7 7.8
------- --------
Cash and cash equivalents at end of period $42.4 $8.0
======= ========
Free cash flow (cash flow before financing excluding
net change in accounts receivable purchase ------- --------
facility less dividends paid) $25.7 $17.0
======= ========
Certain reclassifications of prior year's amounts have been made
to conform with current year's presentation.
PRELIMINARY
CONSOLIDATED BALANCE SHEET
(in Millions)
December June
31 30
2002 2002
--------- ---------
ASSETS
Current Assets:
Cash and cash equivalents $42.4 $18.7
Accounts receivable, net 107.3 133.7
Inventories 191.2 190.0
Other current assets 40.4 33.5
--------- ---------
Total current assets 381.3 375.9
Property, plant and equipment, net 677.7 713.1
Prepaid pension cost 244.1 255.9
Goodwill 46.3 46.3
Trademarks and trade names, net 25.9 26.4
Other assets 57.9 61.9
--------- ---------
Total assets $1,433.2 $1,479.5
========= =========
LIABILITIES
Current liabilities:
Short-term debt $15.9 $16.8
Accounts payable 67.2 76.8
Accrued liabilities 58.6 61.1
Deferred income taxes 6.2 5.9
Current portion of long-term debt 50.1 50.2
--------- ---------
Total current liabilities 198.0 210.8
Long-term debt, net of current portion 367.5 375.8
Accrued postretirement benefits 174.0 167.8
Deferred income taxes 176.1 182.3
Other liabilities 43.6 34.5
--------- ---------
Total liabilities 959.2 971.2
--------- ---------
STOCKHOLDERS' EQUITY
Convertible preferred stock 8.5 24.4
Common stock 117.3 117.3
Capital in excess of par value - common stock 199.8 200.1
Reinvested earnings 201.0 229.0
Common stock in treasury, at cost (38.1) (38.3)
Deferred compensation (3.8) (11.7)
Accumulated other comprehensive income (loss) (10.7) (12.5)
--------- ---------
Total stockholders' equity 474.0 508.3
--------- ---------
Total liabilities and stockholders' equity $1,433.2 $1,479.5
========= =========
Certain reclassifications of prior year's amounts have been made
to conform with current year's presentation.
PRELIMINARY
SEGMENT FINANCIAL DATA
(in Millions)
Three Months Six Months
Ended Ended
December 31 December 31
--------------- ---------------
2002 2001 2002 2001
------- ------- ------- -------
Net sales:
Specialty Metals $178.9 $215.2 $364.9 $430.9
Engineered Products 31.6 33.7 60.1 69.4
Intersegment (0.3) (0.8) (0.9) (1.0)
------- ------- ------- -------
Consolidated net sales $210.2 $248.1 $424.1 $499.3
======= ======= ======= =======
Operating results:
Specialty Metals $4.8 $8.4 $7.7 $20.7
Engineered Products 4.4 2.0 6.6 5.9
Net pension credit 0.6 4.3 1.5 8.5
Corporate costs (4.4) (4.3) (8.5) (8.5)
Special charge (12.9) -- (27.0) --
Interest expense (7.8) (9.1) (15.8) (18.0)
Other income, net 3.1 3.3 3.3 5.0
------- ------- ------- -------
Consolidated income (loss) before
income
taxes and cumulative effect of
accounting
changes ($12.2) $4.6 ($32.2) $13.6
======= ======= ======= =======
Carpenter is organized on a product basis: Specialty Alloys
Operations, Dynamet, Carpenter Powder Products and Engineered Products
Group. For segment reporting purposes, Specialty Alloys Operations,
Dynamet and Carpenter Powder Products are aggregated into one
reportable segment called Specialty Metals because of the similarities
in products, processes, customers and distribution methods.
PRELIMINARY
FREE CASH FLOW
(in Millions)
Three Months Six Months
Ended Ended
December 31 December 31
------------- -------------
2002 2001 2002 2001
------ ------ ------ ------
Net cash provided before financing
activities $19.6 $63.4 $35.7 $77.5
Net change in accounts receivable
purchase facility -- (45.0) -- (45.0)
Dividends paid (2.2) (7.7) (10.0) (15.5)
------ ------ ------ ------
Free cash flow $17.4 $10.7 $25.7 $17.0
====== ====== ====== ======
Certain reclassifications of prior year's amounts have been made
to conform with current year's presentation.
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