Precision Castparts Corp. Reports Fourth Quarter Fiscal 2014 Earnings

Precision Castparts Corp. Reports Fourth Quarter Fiscal 2014 Earnings

                    Fourth Quarter Fiscal 2014 Highlights

  *Record sales of $2.53 billion
  *Record consolidated segment operating margin of 28.5 percent
  *Record EPS from continuing operations of $3.27 (diluted)

PORTLAND, Ore., May 8, 2014 (GLOBE NEWSWIRE) -- Precision Castparts Corp.
(NYSE:PCP) delivered strong sales and earnings per share in the fourth quarter
of fiscal 2014, effectively leveraging demand from robust end markets.

Fourth Quarter Fiscal 2014 Financial Highlights

Precision Castparts Corp. (PCC) sales in the fourth quarter of fiscal 2014
totaled $2.53 billion, increasing 4 percent over sales of $2.43 billion last
year. Year-over-year organic growth was approximately 3 percent, excluding the
impact of metal/revert pricing. Consolidated segment operating income improved
by 15 percent year over year, growing to $720 million, or 28.5 percent of
sales, compared to $626 million, or 25.7 percent of sales, a year ago. Net
income from continuing operations (attributable to PCC) in the fourth quarter
rose to $479 million, versus net income of $415 million in the fourth quarter
of fiscal 2013. Earnings per share (EPS) from continuing operations
(attributable to PCC) were $3.27 in the quarter (diluted, based on 146.4
million shares of stock outstanding), compared to $2.82 (diluted, based on
147.1 million shares of stock outstanding) in the same period last year.

Including discontinued operations, total net income (attributable to PCC) for
the fourth quarter of fiscal 2014 was $484 million, or $3.31 per share

Business Highlights

Investment Cast Products: Total Investment Cast Products sales in the fourth
quarter were $629 million, compared to $635 million a year ago, including an
approximately $5 million decrease in contractual material pass-through
pricing. Continued strong leverage throughout the segment's operations drove a
5 percent increase in operating income, which improved to $224 million, or
35.6 percent of sales this quarter, from $214 million, or 33.7 percent of
sales in the fourth quarter of fiscal 2013. Large commercial aerospace sales
increased approximately 8 percent, spurred by solid production schedules, with
reduced military and regional/business jet shipments tempering overall segment
sales. Even with a year-over-year decrease in OEM industrial gas turbine (IGT)
production, the segment's power business continued to see strong demand,
driven by upgrade programs, share gains, and spares sales. Extracting strong
sales leverage and achieving new levels of performance excellence across their
operations, segment plant managers continued to drive daily operational
disciplines to deliver significant growth to the bottom line.

Forged Products: Forged Products sales were $1,120 million in the fourth
quarter, versus $1,118 million the previous year, including a year-over-year
decline in alloy and revert selling prices of approximately $69 million, which
now includes TIMET, and an expanding level of intercompany activity. Operating
income increased by 19 percent, rising to $302 million in the quarter, or 27.0
percent of sales, from $253 million, or 22.6 percent of sales, in the same
period a year ago. Large commercial aerospace sales increased approximately 5
percent from the same period last year, offset by lower military sales;
regional/business jet sales were flat. IGT sales increased approximately 5
percent, while interconnect pipe sales continued a solid upward trajectory,
showing a 28 percent increase year over year and maintaining a backlog of
nearly one year. Oil & gas shipments declined by 12 percent in the fourth
quarter of fiscal 2014 off of strong shipping schedules in the same quarter
last year. From an operational standpoint, TIMET continued its rapid
integration, aggressively improving its cost models, delivering significant
value across its operations, and is well positioned to capitalize on
additional, clearly defined opportunities going forward. In addition, the base
businesses showed strong incremental drop-through by effectively leveraging
their throughput.

Airframe Products: Sales for the Airframe Products segment increased year over
year by 15 percent, improving to $781 million in the quarter compared to $681
million a year ago. Operating income grew by 18 percent to $232 million, or
29.7 percent of sales, in the fourth quarter, versus $197 million, or 28.9
percent of sales, last year. Aerospace sales showed 17 percent growth year
over year, including 5 percent organic growth. Fastener 787 shipments are now
at an average of eight shipsets per month, with additional upside opportunity
expected as they close the gap with aircraft production schedules.Operating
performance continued its strong upward trajectory across Airframe Products
manufacturing facilities, with base businesses relentlessly driving daily
metrics, and recent acquisitions delivering operational improvements at an
even faster rate and making major contributions to the segment's bottom line.

"In the fourth quarter, we successfully advanced on all major fronts," said
Mark Donegan, chairman and chief executive officer of Precision Castparts
Corp."Over the past year, our base businesses continued to deliver solid
sales and drop through strong earnings, TIMET showed remarkable acceleration
across all its operations, and our recent acquisitions rapidly integrated into
the base businesses, performing at levels well beyond our initial

"As a Company, we have worked diligently to secure strong, long-term contracts
in our target markets and have laid out focused strategies to increase those
positions," Donegan said."We have won major share on all current-production
commercial aircraft programs, and the demand in that market continues to be
very healthy.On the new generation of re-engined narrow-body aircraft now
under development, we have secured even stronger positions, with a real
potential for further content growth going forward.In addition, our
acquisition strategy continues to deliver significant incremental
upside.TIMET's operational efficiencies have significantly improved its asset
utilization, positioning its facilities to handle solid volume increases
beginning to ramp in the second quarter of fiscal 2015, and our Airframe
Products segment is realizing strong benefits from steady market share growth
and increased volumes running across their assets.The acquisition of
Aerospace Dynamics International, which closed after the end of the quarter,
has been a key focus of our strategy for some time, and we expect the same
rapid integration and accelerated performance we have seen from our other
recent acquisitions.

"We have also positioned ourselves well going forward on the power side of our
business," Donegan said."Even in the face of declining OEM production, our
solid positions on new IGT development and retrofit programs have maintained
high shipment levels.The increased market demand for interconnect pipe market
has driven a strong recovery, and our backlog is holding fast at approximately
one year, even as the shipment schedules increase.On the oil & gas front, we
are winning new projects and are aggressively pursuing the next set of
opportunities.The activity level and hit rate in our power markets remain

"All that being said, factory-by-factory operating performance will continue
to be our number one focus," Donegan said."That is ultimately what delivers
value to our shareholders and what generates the cash necessary to pursue our
acquisition strategy.We are dedicated to keeping a strong balance sheet while
striving to improve both our top and bottom line."

Precision Castparts is hosting a conference call to discuss the above
financial results today at 7:00 a.m. Pacific Time.

NOTE: The presentation charts are immediately available on the Company's web

Individuals interested in monitoring the webcast should paste the following
address into their browser for access to the live conference link:

This link will provide both audio and video through the Internet
connection.You may use the following link to check your computer system's
compatibility any time prior to the call:

For Webcast assistance, please dial (888) 569-3848 or (719) 785-6626.

Those interested in asking questions following the earnings presentation must
dial in for audio access to877-879-6184, Access Code: 6981270.Dial *0 for
technical assistance with dial-in access.In order to assure the conference
begins in a timely manner, please dial in 10 to 15 minutes prior to the
scheduled start time.

You may also gain access to the webcast through Precision Castparts Corp.'s
corporate website:

Following the conference call, you may replay the conference by calling (888)
203-1112 or (719) 457-0820; the replay pass code is 6981270.

Precision Castparts Corp. is a worldwide, diversified manufacturer of complex
metal components and products.It serves the aerospace, power, and general
industrial markets.PCC is a market leader in manufacturing large, complex
structural investment castings, airfoil castings, forged components,
aerostructures and highly engineered, critical fasteners for aerospace
applications. In addition, the Company is a leading producer of airfoil
castings for the industrial gas turbine market. PCC manufactures extruded
seamless pipe, fittings, forgings, and clad products for power generation and
oil & gas applications; commercial and military airframe aerostructures; and
metal alloys and other materials to the casting, forging, and other

Information included within this press release describing the projected growth
and future results and events constitutes forward-looking statements, within
the meaning of the Private Securities Litigation Reform Act of 1995. Actual
results in future periods may differ materially from the forward-looking
statements because of a number of risks and uncertainties, including but not
limited to fluctuations in the aerospace, power generation, and general
industrial cycles; the relative success of our entry into new markets;
competitive pricing; the financial viability of our significant customers; the
concentration of a substantial portion of our business with a relatively small
number of key customers; the impact on the Company of customer or supplier
labor disputes; demand, timing and market acceptance of new commercial and
military programs, including the Boeing 787; the availability and cost of
energy, raw materials, supplies, and insurance; the cost of pension and
postretirement medical benefits; equipment failures; product liability claims;
relations with our employees; our ability to manage our operating costs and to
integrate acquired businesses in an effective manner, including the ability to
realize expected synergies; the timing of new acquisitions; misappropriation
of our intellectual property rights; governmental regulations and
environmental matters; risks associated with international operations and
world economies; the relative stability of certain foreign currencies; the
impact of adverse weather conditions or natural disasters; the availability
and cost of financing; and implementation of new technologies and process
improvements. Any forward-looking statements should be considered in light of
these factors. We undertake no obligation to update any forward-looking
information to reflect anticipated or unanticipated events or circumstances
after the date of this document.

Precision Castparts Corp.'s press releases are available on the Internet at
Globe Newswire's website - or PCC's home page at If you wish to be removed from this list, please reply

(Unaudited; in millions, except per share data)

                                  Three Months Ended    Twelve Months Ended
                                  March 30,  March 31,  March 30,  March 31,
                                   2014       2013       2014       2013
Net sales                          $2,530  $2,434  $9,616  $8,361
Costs and expenses:                                              
Cost of goods sold                 1,642    1,649    6,317    5,669
Selling and administrative         168      159      627      535
Interest expense                   17       20       76       38
Interest income                    (2)       (2)       (5)       (7)
Total costs and expenses           1,825    1,826    7,015    6,235
Income before income tax expense
and equity in earnings of          705      608      2,601    2,126
unconsolidated affiliates
Income tax expense                 (224)     (191)     (835)     (694)
Equity in earnings of              —         —         1        1
unconsolidated affiliates
Net income from continuing         481      417      1,767    1,433
Net income (loss) from             5        —         17       (3)
discontinued operations
Net income                         486      417      1,784    1,430
Net income attributable to         (2)       (2)       (7)       (3)
noncontrolling interests
Net income attributable to         $484    $415    $1,777  $1,427
Precision Castparts Corp. ("PCC")
Net income per common share
attributable to PCC shareholders –                               
Net income per share from          $3.30   $2.83   $12.09  $9.81
continuing operations
Net income (loss) per share from   0.03     —         0.11     (0.02)
discontinued operations
Net income per share               $3.33   $2.83   $12.20  $9.79
Net income per common share
attributable to PCC shareholders –                               
Net income per share from          $3.27   $2.82   $12.01  $9.75
continuing operations
Net income (loss) per share from   0.04     —         0.11     (0.03)
discontinued operations
Net income per share               $3.31   $2.82   $12.12  $9.72
Weighted average common shares                                   
Basic                              145.3    146.3    145.6    145.7
Diluted                            146.4    147.1    146.6    146.7

                                  Three Months Ended    Twelve Months Ended
                                  March 30,  March 31,  March 30,  March 31,
                                   2014       2013       2014       2013
Sales by Segment                                                 
Investment Cast Products           $629    $635    $2,462  $2,480
Forged Products                    1,120    1,118    4,272    3,566
Airframe Products                  781      681      2,882    2,315
Total                              $2,530  $2,434  $9,616  $8,361
Segment Operating Income (Loss)^2                                
Investment Cast Products           $224    $214    $874    $838
Forged Products                    302      253      1,088    777
Airframe Products                  232      197      863      687
Corporate expense                  (38)      (38)      (153)     (145)
Consolidated segment operating     720      626      2,672    2,157
Interest expense                   17       20       76       38
Interest income                    (2)       (2)       (5)       (7)
Income before income tax expense
and equity in earnings of          $705    $608    $2,601  $2,126
unconsolidated affiliates

^1Reported results for the three and twelve months ended March 31, 2013 have
been restated for discontinued operations.
^2Operating income represents earnings before interest, income tax expense,
and equity in earnings of unconsolidated affiliates.

(Unaudited; in millions)

                                                March 30,  March 31,
                                                 2014       2013
Cash and Debt Balances                                     
Cash                                             $361    $280
Total Debt                                       $3,572  $3,807
Total PCC Shareholders' Equity                   $11,386 $9,783
Total Debt, as % of Total Capitalization         23.9 %     28.0 %
Working Capital Items^1                                    
Receivables, Net                                 $1,578  $1,507
Inventories                                      3,438    2,980
Accounts Payable                                 1,047    940
Total                                            $3,969  $3,547
                                                Three Months Ended
                                                March 30,  March 31,
                                                 2014       2013
Selected Cash Flow Items^1                                 
Depreciation and Amortization                    $76     $68
Capital Expenditures                             $94     $118
Acquisitions of Businesses, Net of Cash Acquired $153    $527
                                                Three Months Ended
                                                March 30,  March 31,
                                                 2014       2013
Sales by Market^1                                          
Aerospace                                        68 %       67 %
Power                                            18 %       18 %
General Industrial & Other                       14 %       15 %

^1 Reported results exclude discontinued operations.

CONTACT: Jay Khetani, Vice President of Investor Relations
         (503) 946-4700

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