WEATHERSFIELD Parent of RTI boosts profits
The company president expects 2003 to be another challenging year for the titanium producer and fabricator.
By CYNTHIA VINARSKY
VINDICATOR BUSINESS WRITER
WEATHERSFIELD -- Year-end profits topped $15 million for RTI International Metals, despite a difficult fourth quarter and a continuing downturn in the aerospace industry which has traditionally been its bread and butter.
RTI, parent company of RMI Titanium in Weathersfield Township, said it made more money in 2002, even though its sales totals were lower than the year before, by concentrating on more high-value products.
The company reported 2002 earnings of $15.1 million, or 73 cents per share, on sales of $270.9 million, compared with 2001 earnings of $12.1 million, or 58 cents per share, on sales of $285.9 million.
Tim Rupert, RTI president and chief executive, said both the titanium production group based at RMI and the fabrication and distribution group were profitable, even though the commercial aerospace industry the company depends upon for business has yet to rebound from a post-Sept. 11, 2001, slump.
Rupert said 2003 will be "another challenging year" for the titanium production division because aircraft build rates are expected to be down again this year. RTI has traditionally relied on commercial aerospace for about 40 percent of its business.
He said the titanium group generated more than $10 million in operating income for the year on shipments of less than 10 million pounds by focusing on its more profitable business and cutting production cost by more than 5 percent.
Rupert said the fabrication and distribution group, which earned more than $5 million in 2002, showed progressively higher earnings each quarter and is expected to show continued growth in the new year.
Payments from Boeing
Results for 2002 and 2001 included payments from aircraft maker The Boeing Co. under a supply agreement that requires the Seattle-based company to make minimum purchases each year or pay the supplier. Boeing paid RTI $7 million last year and $6 million the year before.
RTI reported fourth-quarter earnings of $625,000, or 3 cents per share, on sales of $64.2 million. That compares with earnings of $5.3 million, or 26 cents per share, on sales of $68.7 million in the final quarter of 2001.
Titanium mill product shipments totaled 2.1 million pounds in the fourth quarter, down 25 percent from the same period in 2001. The decrease was related to a weak aerospace industry and the resulting low demand for titanium, which is used in aircraft production because of its strength and light weight.
The titanium production division had a fourth-quarter operating loss of $1.3 million on sales of $30 million, the company said, due in part to a planned six-week shutdown of its Weathersfield plant. The mill was idle for six weeks from Thanksgiving until the first week of this month.
That loss was offset, however, by the fabrication and distribution group's performance. The group, led by RTI Energy Systems Inc., had its best quarter of the year, with earnings of $2.0 million on sales of $34.2 million, allowing the company to earn a modest consolidated profit for the fourth quarter.