Even with RMI lockout, RTI turns a profit again
A lump-sum, $9.1 million payment from Boeing turned red into black.
& lt;a href=mailto:vinarsky@vindy.com & gt;By CYNTHIA VINARSKY & lt;/a & gt;
VINDICATOR BUSINESS WRITER
WEATHERSFIELD -- RTI International Metals reported its second consecutive profitable quarter, despite a six-month-old lockout of union employees at its RMI Titanium mill.
RTI, the Weathersfield-based parent of RMI, reported first-quarter earnings of $2.8 million, or 13 cents per share, on sales of $54.1 million. The company had profits of $4.3 million, or 21 cents per share, on sales of $58.5 million in the same period a year ago.
RTI's titanium group and its fabrication and distribution groups both lost money in the quarter ending March 31, according to reports filed with the federal Securities and Exchange Commission.
RTI managed to end the quarter in the black, however, because of a $9.1 million lump sum payment from The Boeing Co., which added $6 million, or 28 cents per share to its net income.
The Boeing payment in the first quarter was the last RTI will receive under a lucrative, long-term agreement in which the aircraft manufacturer was required to pay when it failed to buy a prearranged amount of titanium. RTI has been getting lump sum payments of $7 million or more for several years, but the contract has expired.
RTI reported titanium mill shipments of 1.5 million pounds for the quarter, up slightly over last year, but said average prices of $15.03 per pound were nearly 10 percent lower than a year ago.
Comparison
The titanium group lost $4.1 million on sales of $37.7 million, $24.6 million of which represented sales to other RTI divisions. In comparison, the company lost $3.4 million on sales of $32.7 million in the first quarter of 2003, with $18.5 million listed as intercompany sales.
Officials said the labor cost savings related to its lockout of about 380 members of United Steelworkers of America at RMI "partially offset" the lower titanium prices. "To date, the work stoppage has not been an impediment to operational utilization or the booking of new orders," the company said in a news release.
RTI's fabrication and distribution group lost $900,000 on sales of $41 million, compared with a $1.8 million profit on sales of $44.3 million in the same period last year.
Late deliveries and rising prices of steel used in two of its projects had a negative impact on that division, the company said, along with the continuing sluggishness of the aerospace industry.
Tim Rupert, RTI president and chief executive, said the company will continue to focus on expanding value-added products and reducing production costs in what he called a continuing downturn in the aerospace industry. Rupert said demand for titanium in aircraft production continues to be low.
& lt;a href=mailto:vinarsky@vindy.com & gt;vinarsky@vindy.com & lt;/a & gt;