Carpenter Technology Corporation (NYSE:CRS) today reported net income attributable to Carpenter of $39.2 million or $0.74 per share for the quarter ended September 30, 2012. The net accretion from Latrobe’s operating results offset by a higher share count, contributed $0.07 per share.
“Our strong first quarter results demonstrate that we are continuing to execute well against our strategic plan,” said William A. Wulfsohn, President and Chief Executive Officer. “While there are some areas, particularly in lower value products, where customer demand has softened recently, our overall business continues to be well positioned in attractive end markets with strong demand for our ultra-premium and premium products. This is evident in our strong top line growth, and continuing positive spread between our revenue and volume growth rates.
“Latrobe results, after seven months of ownership, remain strong and we are still tracking ahead of our deal economics, with the acquisition expected to be at least 10 percent accretive this fiscal year. The teams are doing an outstanding job delivering operational synergies from the combined operation that will lead to higher volumes, improved costs and a richer mix. The first new VAR furnace recently began operation with two more to come on-line in the near future. We are accelerating use of the Latrobe assets for additional premium products, which will enable us to continue improving mix and our average mill profit per pound.
“We also continue to identify opportunities, as part of the Latrobe integration, to optimize asset utilization across the total mill operation. There are several small, near-term consolidation opportunities that we have begun to execute, and we continue to evaluate other potential opportunities to optimize our system assets. In addition, we have completed a study that identifies significant inventory reduction opportunities across the mill system, which we will begin to implement.
“We remain on track to achieve the financial targets we set for our full fiscal year and expect strong 2nd half shipment levels. Strong customer demand for the ultra-premium and premium parts of our product line, combined with our large backlog is consuming our full available premium capacity.”