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The worst of the recession "appears behind us, and we remain confident in the intermediate and long-term growth potential of our core markets," said L. Patrick Hassey, CEO of the Downtown based specialty metals and titanium manufacturer. "The third quarter is probably the worst quarter we are going to have," Hassey added.
The company said net income was $1.4 million, or 1 cent per share, on sales of $697.6 million. A year ago, net income was $144.1 million, or $1.45 a share on sales of $1.39 billion, which Hassey said reflected a much stronger economy.
The company's stock fell $3.18, or 8.4 percent, to $34.81, the biggest decline since July 22. The shares have risen 36 percent this year.
The company was projected to report earnings per share of 3 cents, the average estimate of 10 analysts surveyed by Bloomberg. Sales were projected to drop to $751.1 million.
As an indication of just how much the global downturn has hurt the company, Hassey said Allegheny Technologies had set a target for 2009 of shipping between 300,000 tons and 350,000 tons of metal products. But he believes it will be closer to 250,000 tons this year, as its mills are running at about 50 percent capacity.
Hassey said that Allegheny Technologies' customers are stretching deliveries into 2010, but he emphasized they are not canceling projects.
The company reached long-term contracts -- running between two and 10 years -- with key customers in the aerospace, defense, oil and gas industries, and medical markets, Hassey said. One of those agreements, with Rolls Royce, will give Allegheny Technologies between $750 million and $1 billion in revenue to supply specialty metals for jet engines.
Allegheny Technologies is in a position to take advantage of growth in the nuclear power industry, which is building 35 nuclear reactors globally with 100 planned, Hassey said.
The company also remains committed to its $1.2 billion development of the new hot strip mill at its Brackenridge plant, Hassey said. The company is continuing with its engineering and design on the project, and construction is expected to begin next year, he said.
Joe Napsha can be reached via e-mail or at 724-836-5252.
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