Carpenter Technology Revises Third Quarter and Annual Financial Estimates.

Business Editors

WYOMISSING, Pa.--(BUSINESS WIRE)--March 20, 2001

Carpenter Technology Corporation (NYSE:CRS) today announced that it expects its diluted earnings per share for its third fiscal quarter ending March 31, 2001, to be in the range of $.45 to $.50 per share.

The company also indicated that it expects its diluted earnings per share for the year ending June 30, 2001, to be in the range of $2.10 to $2.25 per share compared with $2.31 per share last year.

Previously, Carpenter had indicated that its third quarter results would exceed the prior-year diluted earnings per share of $.52 by 10 percent, and its diluted earnings per share for the year would be in the range of $2.40 to $2.60 per share.

Carpenter's revised earnings expectations result from decreased shipments of stainless products to the automobile industry, the effect of higher imports of stainless bar and rod, the general economic slowdown and the associated lower operating levels in Specialty Alloys Operations (SAO).

As a result, the company also announced that it would indefinitely furlough approximately 50 production employees at its Reading, PA, facility beginning April 2. Carpenter recently implemented a temporary furlough of about 200 employees for one week in March and plans a similar temporary furlough for one week in April.

Robert W. Cardy, chairman and chief executive officer, said, "While we are disappointed about our lower stainless sales in the automotive sector and the resulting furloughs, our aerospace and power generation markets continue to be very strong. Sales of Dynamet and the Engineered Products Group continue on target. We are also pleased with the recent extension by the International Trade Commission (ITC) of antidumping duties on stainless steel bar imports from Brazil, India, Japan and Spain, and the ITC's preliminary ruling against six other countries (France, Germany, Italy, Korea, Taiwan and the United Kingdom) that were found to be injuring domestic stainless bar producers. With the reductions we are making in our SAO production schedules and overall capital spending, as well as improvements in our inventory management process, we continue to expect to generate $50 million of free cash flow this fiscal year."

Carpenter plans to broadcast a live conference call and webcast on Thursday, April 19, at 10 a.m., ET, to discuss its results of operations for the quarter ended March 31 and current business conditions. The live webcast will be available at www.vcall.com. Please call Jaime Vasquez at 610/208-2165 for the conference call telephone number and passcode.

Carpenter produces and distributes specialty metals, including stainless steels, titanium alloys, superalloys and various engineered products. Information about Carpenter can be found on the Internet 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 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's Form 10-K and Form 10-Q reports and exhibits to those reports, and include (but are not limited to): 1) the cyclical nature of the specialty materials business and certain end-use markets, including, but not limited to, aerospace, automotive and consumer durables, all of which are subject to changes in general economic and financial market conditions; 2) the ability of Carpenter to recoup increased costs of fuel, such as natural gas, and raw materials, such as nickel, through increased prices and surcharges; 3) worldwide excess capacity for certain alloys which Carpenter produces and fluctuations in currency exchange rates, resulting in increased competition and downward pricing pressure on Carpenter products; and 4) fluctuations in stock markets which 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.