RTI INTERNATIONAL METALS CEO predicts profit amid rough year

A union leader says an RTI competitor's stock is a better performer.
By CYNTHIA VINARSKY
VINDICATOR BUSINESS WRITER
WEATHERSFIELD -- RTI International Metals will likely make a profit in 2004, its chief executive says, but it won't be an easy year.
Reporting on the company's first-quarter financial results in a telephone conference with analysts Wednesday, CEO Tim Rupert said weak demand from the aerospace market is continuing to hold profits down for both of its operating groups.
The Weathersfield-based parent company of RMI Titanium, which also is in Weathersfield, reported first-quarter earnings of $2.8 million, or 13 cents per share on sales of $54.1 million.
But a union leader representing about 360 locked-out workers at RMI said he's hoping shareholders will take a close look at the company's financial performance, perhaps comparing its results to Denver-based Titanium Metals Corp., or TIMET, its biggest competitor in the titanium industry.
Todd Waddell, president of United Steelworkers of America Locals 2155 and 2155-7, noted that TIMET's stock made a dramatic 300 percent turnaround this year and has been selling in the $90 range. RTI's share prices also increased in value but topped off in the $15 to $17 range.
"Apples to apples, TIMET shareholders are getting a lot more return," Waddell said. "It seems like the [RTI] company officials are more interested in playing games with the union than they are in making money, and the result is that the stockholders and the workers all lose out."
RTI said, in a press release announcing the first-quarter earnings Tuesday, that its dispute with the locked-out workers "has not been an impediment" to operations or booking of new orders. Union members have repeatedly offered to return to work while bargaining continues.
Officials' forecast
Rupert said officials anticipate "a tough year" for RTI's titanium group, of which RMI is a part. He said deliveries are outpacing new orders 3-to-1 for Boeing and Airbus, the world's two largest aircraft producers, and no significant recovery is expected in the aerospace industry until 2006.
The titanium group had an operating loss of $4.1 million in the first quarter on sales of $37.7 million.
RTI's fabrication and distribution group was hurt by rising steel prices and some late deliveries on orders in the quarter ending March 31. That division lost $900,000 on sales of $41 million.
Rupert said the fabrication and distribution group is expected to recover in the remaining three quarters of fiscal 2004 and to earn a profit high enough to make up for losses in other operating units.
RTI would have finished its first quarter in the red if not for a lump-sum, $9.1 million payment it received from The Boeing Co. under a long-term contract that expired this year. Boeing was required to pay damages to RTI for its failure to buy 3.5 million pounds of titanium a year as specified under the five-year contract.
vinarsky@vindy.com