Carpenter surpasses financial goals, continues expansion.

READING, Pa.--(BUSINESS WIRE)--Oct. 24, 1995--Carpenter Technology Corp. (NYSE:CRS) is setting records for its financial performance, and the company will significantly increase its capital expenditures the rest of this decade to sustain this growth in revenue and earnings, Carpenter's chairman told shareholders at the company's annual meeting late Monday.

Speaking at the meeting near the company's major Reading plant, Robert W. Cardy, chairman, president and chief executive officer called the past fiscal year (ended June 30) "a very good year, setting several records."

Sales grew 21 percent to $758 million, Carpenter's best sales year ever. Earnings were up 24 percent, to more than $47 million. Return on shareholders' equity grew to 19.3 percent, exceeding that of the S&P 500, which is projected to be 16.7 percent this year.

Fiscal 1996 is expected to be another robust year, Cardy said. Last week, Carpenter announced that first quarter sales were up 18 percent, to a record $184.5 million, compared to the same period last year. Earnings for the first quarter were up 141 percent, to a record $11.9 million.

"The long-term outlook for growth is strong, and, as such, we need to expand our capacity to fulfill the domestic and global market demands," Cardy said. He announced plans to:

o Spend $29 million on a new 20-ton vacuum induction melting furnace and two new vacuum arc remelting furnaces, which will be appropriately sized to pursue current and new market opportunities. These three furnaces, used to produce metals with improved properties over traditional arc melting methods, would be operational in the Reading plant by January or February 1997.

Carpenter's premium-melted products made in such furnaces have selling prices significantly above those of its average product line due to stringent processing requirements.

Premium-melted metals can be found in a growing range of sophisticated parts and applications, such as jet engine shafts, anti-theft devices, valves in a truck's heavy-duty diesel engine and turbine blades in power generation equipment.

o Address capacity constraints in the finishing of stainless bar and wire products, Carpenter's largest product lines, now. This includes the completion of a multi-year wire finishing modernization program. The upgrades are leading to faster and more uniform coating, drawing and packaging of wire products.

o Invest in additional finishing equipment -- drawing, annealing, shaving and grinding equipment -- later this decade.

Carpenter is expanding its manufacturing capacity on a selective basis, as a way to grow its core specialty metals business, Cardy said. At the same time, the company also is examining logical strategic acquisitions.

Carpenter, for example, is pursuing "the most superior of the developing component engineering technologies," used to produce parts made of metals, alloys and ceramics. "Acquiring these technologies will help us develop a worldwide specialty engineering product capability," he said.

At the meeting:

o Five directors were re-elected to Carpenter's 13-member board of directors for three-year terms -- Cardy, Arthur E. Humphrey, Edward W. Kay, Frederick C. Langenberg and Kathryn C. Turner.

o The accounting firm of Coopers & Lybrand L.L.P. was approved as Carpenter's independent accountants for fiscal 1996.

o Several changes to the non-qualified stock option plan for non-employee directors were passed. For each of these directors, the number of options granted to acquire shares of common stock will now increase from 500 shares annually to 2,000 shares annually. The number of shares reserved for the plan was increased to 180,000.

Carpenter manufactures high performance alloys and specialty steel products for automotive, aerospace, electronics and other industries worldwide. The company also manufactures ceramic cores for the casting industry. The 106-year-old company has approximately 4,200 employees worldwide and 2,700 in Reading.

CONTACT: Carpenter Technology Corp., Reading

Katharine Marshall, 610/208-3034