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Allegheny Technologies Comments on Challenging First Quarter 2013
04/16/2013 - Allegheny Technologies Inc. said its first quarter 2013 operating performance was impacted by record-low base-selling prices for cold-rolled standard sheet, primarily due to low-priced imports, weak demand and low prices for grain-oriented electrical steel, and weak demand for our zirconium and related alloys.
Allegheny Technologies Incorporated announced that it expects first quarter 2013 net income attributable to ATI to be approximately US$10 million on sales of approximately US$1.18 billion.
“As we stated in January, we expected challenging business conditions in the first quarter of 2013,” said Rich Harshman, chairman, president and chief executive officer. “Operating performance continued to be impacted by record-low base-selling prices for cold-rolled standard sheet, primarily due to low-priced imports, weak demand and low prices for grain-oriented electrical steel, and weak demand for our zirconium and related alloys.
“In addition, falling raw materials prices continued to impact sales and operating income. Contract business was mostly steady. Transactional business was soft due to falling raw materials prices and short lead times, and many customers continued with conservative inventory management actions. Higher inventory costs, including higher conversion costs due to lower operating rates in the fourth quarter 2012 and manufacturing cycle times for some of our products that do not align raw materials costs with lower surcharges and indexes, reduced operating income.
“We continue to believe that market conditions remain favorable for secular growth from our key markets of aerospace, oil & gas/chemical process industry, electrical energy, and medical over the long term. We also expect significantly improved operating performance in our Flat-Rolled Products segment to result from our Hot-Rolling and Processing Facility (HRPF) that is scheduled for completion with assets ready for service by the end of 2013. Formal commissioning is expected to occur through the first half 2014.”
Allegheny Technologies Incorporated is one of the largest and most diversified specialty metals producers in the world with revenues of approximately US$5.0 billion in 2012. ATI has approximately 11,200 full-time employees world-wide who use innovative technologies to offer global markets a wide range of specialty metals solutions. Our major markets are aerospace and defense, oil and gas/chemical process industry, electrical energy, medical, automotive, food equipment and appliance, machine and cutting tools, and construction and mining. Our products include titanium and titanium alloys, nickel-based alloys and superalloys, grain-oriented electrical steel, stainless and specialty steels, zirconium, hafnium, and niobium, tungsten materials, forgings, castings and fabrication and machining capabilities.
