NORTH JACKSON — Universal Stainless and Alloy Products Inc., a Pennsylvania-based specialty steel company, plans to invest $15 million at its North Jackson facility to increase capacity to meet growing demand in the aerospace industry.

“The expansion we are talking about doing here is going to add to our vacuum arc re-melt furnace capacity,” said Dennis Oats, chairman, president and CEO.

Two new furnaces have been ordered with the expectation they will be installed and the first melts done in the first quarter of 2023, Oats said. The mill at 2058 S. Bailey Road will be expanded about 15,000 square feet to accommodate the two furnaces and two more planned for the next three to four years.

A ceremonial ribbon cutting is planned for 11 a.m. Thursday at the mill.

The mill produces specialty steels, including nickel alloy, stainless steel and low alloy steels melted using vacuum-induction melting. After the raw materials are melted and cooled, they are remelted. The batches are small, said Oats, “because of the criticality of the applications.”

In addition, the plant has a bar finishing shop to produce semi-finished and finished long products supplied by the North Jackson plant and Universal Stainless’ plant in Bridgeville, Pa., according to the company’s website.

The North Jackson mill also supports the company’s Dunkirk, N.Y., plant with feedstock for that mill’s finished products. Universal Stainless has a fourth plant in Titusville, Pa.

An affiliate of Universal Stainless, North Jackson Specialty Steel, LLC, acquired the plant and land for $16 million in August 2011, according to the Mahoning County Auditor’s Office. Then, the plant was partially complete. Universal Stainless finished construction and installed the equipment.

“The reason for the investment there was to add new technology to our company to enable us to bring more technology-advanced products into our product portfolio,” Oats said. “Our products are specialty alloys that go into primarily aerospace applications. That is about 70 percent of our sales.”

Oats said the company is in the process of hiring because of the market demand for Universal Stainless products. The company, he said, has a record backlog of about $204 million, and the aerospace outlook is positive given the waning pandemic and people’s desire to travel more again.

“Travel is back, so that helps the aftermarket, which feeds our business. As Boeing and Airbus start to ramp up the build rates in 2023, they are going to need to start buying the metal to make those parts right now. That is what you are seeing in our backlog coupled with defense business, (which) has been fairly stable and at a decent level throughout the pandemic,” Oats said.

According to the company’s latest earnings report, first quarter 2022 net sales were $47.6 million, a 10 percent increase from the fourth quarter of 2021 and 28.4 percent greater than the first quarter of 2020.

Sales of premium alloys increased 26.9 percent in the first quarter of this year to $8.9 million, or 18.8 percent of sales, compared with $7 million, or 16.3 percent of sales, in the fourth quarter of 2021.

Premium alloys sales were $7.6 million, or 20.4 percent of sales, in the first quarter of 2021.

Universal Stainless experienced a first-quarter net loss of $1.6 million, the same amount experienced in the fourth quarter of 2021. The net loss for the first quarter of 2021 was $4.5 million.

The company’s earnings before interest, taxes, depreciation, and amortization (EBITDA) was $3.8 million. EBITDA is a measure of a company’s overall financial performance.

rselak@tritboday.com