RMI TITANIUM Plant set to close 3-4 weeks in July
The planned shutdown would be cut short or canceled if the mill gets an influx of new orders.
By CYNTHIA VINARSKY
VINDICATOR BUSINESS WRITER
WEATHERSFIELD -- The parent company of RMI Titanium is stepping up production to build inventory at its Weathersfield Township plant now, with plans to shut down the facility for three or four weeks in July.
Tim Rupert, president and chief executive of RTI International Metals, RMI's parent, said the shutdown is part of an aggressive cost-cutting plan designed to help the company weather a continuing decline in the commercial aerospace market.
The shutdown at RMI will be canceled or shortened, he said, if the mill gets an unanticipated influx of new orders.
Rupert noted that RMI closed for a week at Thanksgiving and for two weeks at Christmas, but he could not recall the last time a four-week shutdown was scheduled. The plant employs 595 hourly and salaried workers.
Discussing RTI's financial performance in a conference call for investors and the press Tuesday, Rupert said the company earned $8 million, or 39 cents per share in the first three months of 2002, up from $3.9 million, or 19 cents per share in the same period of 2001.
He said RMI, its titanium division, reported $4.1 million in first-quarter earnings, a "modest gain" over the preceding quarter.
About 40 percent of RTI's business comes from commercial aerospace customers. Rupert said the company expects moderate growth in defense contracts, generally 30 percent of its business, and in energy contracts, about 10 percent.
"Profitability will be modest for at least the next four quarters," Rupert said.
The company's first-quarter profit got a major boost from the appreciation of stock the company was given by Anthem Insurance Co., its health insurance provider, and a lump sum payment from the Boeing Co.
Added to profits
RTI received stock valued at $6.6 million in December when Anthem switched from a mutual insurance company to a publicly held company. By the time RTI sold its shares last quarter the stock had appreciated in value considerably, and the sale added 6 cents per share to the company's quarterly profits.
Boeing paid RTI about $7 million in the first quarter because the aerospace giant failed to buy 3.25 million pounds of titanium last year as required under its long-term contract. The Boeing payment added 21 cents per share to RTI's earnings. It was the third consecutive year Boeing has paid a lump sum after failing to meet its purchase minimum.