** Carpenter issued 8.1 million shares of common stock as part of the Latrobe acquisition. The weighted average impact was 2.7 million and 0.9 million shares for the three and nine months ended March 31, 2012, respectively.
Carpenter Technology Corporation (NYSE:CRS) today reported net income attributable to Carpenter of $33.0 million or $0.69 per share for the quarter ended March 31, 2012. Carpenter legacy earnings, before Latrobe and share dilution, would have been $0.81 per share. The net accretion from Latrobe’s operating results before inventory fair value cost adjustments, offset by a higher share count, contributed $0.03 per share – resulting in adjusted earnings per share before Latrobe acquisition related costs of $0.84. From this, the Company had $0.15 per share of total acquisition related costs, which includes Latrobe transaction costs and inventory fair value cost adjustments, resulting in reported earnings of $0.69 per share.
“We had another strong quarter of results and are poised to continue our business momentum with the addition of Latrobe,” said William A. Wulfsohn, President and Chief Executive Officer. “The continued positive impacts from pricing and mix management actions are evident in our revenue growth and further improvement in our operating margin and average Specialty Alloy Operations profit per pound. We continue to maintain a strong order backlog and are progressing rapidly on our commitment to exceed our prior peak level of EBITDA, excluding any Latrobe contribution.
“February 29 th was a very exciting day in the history of Carpenter as we closed on the Latrobe transaction. The integration process is going well, and now that our teams have combined, we are even more encouraged by the synergy potential of the combination. The Latrobe business is already accretive to earnings excluding final transaction costs and short-term inventory accounting impacts that will end after the next quarter.“We are making great progress to create additional premium products capacity in the near-and-long term to support the material and service needs of our customers in what we believe is the early stage of a strong growth cycle in the aerospace and energy markets. We have taken actions this year to add remelt capacity and address constraints in our Reading operations. We are also moving quickly to enhance Latrobe’s premium products capacity with the addition of three VAR furnaces – a project that we initiated just after closing. With the additional capacity from Latrobe and other investments we have made in Reading, we believe we can create another roughly 4,000 tons of premium products capacity over each of the next two years. This additional capacity will bridge our ability to meet increased customer demand until our new facility in Alabama is operational in April, 2014. We are now in the construction phase of that investment as we just broke ground this month. This new facility will be capable of producing 27,000 tons of premium products – which will enable us to accommodate more customer demand through shorter lead times.
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