Proven to perform
anywhere.
Fourth Quarter and Full Year 2024 Earnings
February 4, 2025
ATI Proprietary and Confidential ©2025 ATI. All rights reserved. | 1 |
Forward Looking
Statements
This presentation contains forward-looking statements. Actual results may differ materially from results anticipated in the forward-looking statements due to various known and unknown risks, many of which we are unable to predict or control. These and additional risk factors are described from time to time in the Company's filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2023.
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Key Takeaways
Performance | Balance Sheet | Strategic Progress |
Strong recovery from Q3 outages; | Deploying capital for shareholder | Strategic investments extend |
Growth in Jet Engine & Defense | returns, efficiently managing capital | competitive advantages |
Q4 Adj. EBITDA1 of $210M
- 13% sequential, 31% YoY increase
Adj. EBITDA1 Margin 17.9% in Q4
- 280 bps improvement YoY
Q4 A&D at 65% of sales
- 22% YoY growth in Jet Engine
- 32% YoY growth in Defense
- 17% YoY growth in Aero-Like markets
- Offset by (5%) YoY decrease in Airframe
Ended Q4 with $1.3B of total liquidity including $721M cash on hand
- Managed Working Capital1 was 31% of sales at end of Q4
Executing $700M Stock Repurchase Authorization
- $70M of repurchases in Q4
- $590M remains on authorization
- ~5.3M shares repurchased in 2024
- Continued progress made in de- bottlenecking forging operations and expanding testing capacity
-
Washington brownfield expansion remains on schedule
• Qualifications in 2025 - First print from new greenfield expansion in Florida: Additive Manufacturing Operations
(1) See appendix for reconciliation of non-GAAP financial measures. | 3 |
A&D outlook strong despite near-term airframe disruptions
Forecasting double-digit Year-over-Year (YoY) growth for most core markets
Market | Q4-24 | Sequential | YoY | 6-Mo | 3-Yr | ATI Perspective |
Revenue ($M's) | Change | Change | Outlook | Outlook | ||
Jet Engine | $428 | +17% | +22% | • Sequential and year-over-year growth resulting from broadening | ||
customer diversification, operational and supply chain improvements, | ||||||
and strong aftermarket demand | ||||||
• Sequential growth driven by modest recovery in titanium market | ||||||
Airframe | $191 | +6% | (5)% | • YoY sales decline driven by lower production rates and disruptions | ||
from Boeing work stoppage | ||||||
Defense | $148 | +38% | +32% | • Sequential and year-over-year growth led by military aircraft, exotic | ||
alloys, and munitions materials | ||||||
Total A&D | $767 | +17% | +15% | ATI revenue from Aerospace & Defense = 65% | ||
• Sequential growth driven by large project shipment of material used | ||||||
Specialty Energy | $82 | +18% | +36% | for coal-fire power plant cleanup and increased gas-turbine demand | ||
• YoY increase led by continued growth in nuclear power generation | ||||||
as well as increased gas-turbine demand | ||||||
Electronics | $52 | +5% | +15% | • Sequential and YoY growth driven by growth in hafnium and | ||
increased shipments of materials for handheld electronics | ||||||
Medical | $51 | (4)% | (3)% | • Lower sequential and YoY sales driven by ongoing inventory | ||
rebalancing in medical device supply chain | ||||||
Core End Markets | $952 | +15% | + 16% | ATI revenue from Core End Markets = 79% | ||
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Fourth Quarter 2024 Financial Results
$M (excl. EPS)Q4 2024 Q4 2023 % Chg. Q3 2024 % Chg.
Revenue | $1,173 | $1,064 | +10% | $1,051 | +12% |
HPMC Segment | $634 | $583 | +9% | $552 | +15% |
AA&S Segment | $539 | $482 | +12% | $499 | +8% |
Segment | $215 | $182 | +18% | $197 | +9% |
EBITDA | |||||
HPMC Segment | $127 | $125 | +1% | $123 | +3% |
Adj. EBITDA % | 20% | 22% | (200) bps | 22% | (200) bps |
AA&S Segment | $88 | $57 | +54% | $74 | +20% |
Adj. EBITDA % | 16% | 12% | +400 bps | 15% | +100 bps |
Adj. EBITDA (2) | $210 | $161 | +31% | $186 | +13% |
(ex. special items) | |||||
Adj. EBITDA % | 18% | 15% | +300 bps | 18% | - bps |
EPS (1) | $0.94 | $0.99 | (5)% | $0.57 | +65% |
Adj. EPS (1)(2) | $0.79 | $0.64 | +23% | $0.60 | +32% |
Note: amounts may not add due to rounding.
(1) Attributable to ATI
(2) See appendix for full reconciliation to the nearest GAAP measures
January 2019
HPMC Segment
Revenue: Up 9% year-over-year (YoY); up 15% sequentially
- Led by continued growth in Jet Engine and Defense materials and forgings
- Sales growth reflects strong recovery from VIM outage and continued de-bottlenecking progress in forgings
EBITDA: Up 1% YoY; up 3% sequentially
- Reflects increased A&D volume and price gains in isothermal Jet Engine forgings
- Partially offset by charge related to customer commercial negotiations
- Prior year includes $10M of insurance recovery
AA&S Segment
Revenue: Up 12% YoY; up 8% sequentially
- Sales growth led by increase Defense shipments for both ground armor and naval materials
- Growth was partially offset by weaker Industrial demand
EBITDA: Up 54% YoY; up 20% sequentially
- EBITDA reflects increased A&D volume and favorable overall product mix
- Also impacted by $10.4M retroactive Advanced Manufacturing Production Credit (AMPC), partially offset by charge related to customer commercial negotiations
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Full Year 2024 Financial Results
$M (excl. EPS)FY 2024 FY 2023 % Chg.
Revenue | $4,362 | $4,174 | +5% |
HPMC Segment | $2,279 | $2,120 | +8% |
AA&S Segment | $2,084 | $2,054 | +2% |
Segment | $782 | $710 | +10% |
EBITDA | |||
HPMC Segment | $461 | $434 | +6% |
Adj. EBITDA % | 20% | 21% | (100) bps |
AA&S Segment | $321 | $277 | +16 % |
Adj. EBITDA % | 15% | 14% | +100 bps |
Adj. EBITDA (2) | $729 | $635 | +15% |
(ex. special items) | |||
Adj. EBITDA % | 17% | 15% | +200 bps |
EPS (1) | $2.55 | $2.81 | (9)% |
Adj. EPS (1) (2) | $2.46 | $2.56 | (4)% |
HPMC Segment
Revenue: 8% year-over-year top-line growth driven by:
- Year over year sales growth from increases in Jet Engine and Defense materials, driven by price gains in nickel and higher volume in titanium and forgings
EBITDA: 6% year-over-year growth driven by:
- Margin drop-through from continued Jet Engine and Defense growth
- Richer overall product mix and strong pricing in nickel, titanium, and forgings
AA&S Segment
Revenue: 2% year-over-year sales growth driven by:
- Year over year growth 9%, excluding metal impacts on pass-through revenue
- Year over year growth in A&D of 11% and "aero-like" growth of 19%
- Partially offset by 13% year over year reduction in industrial market sales
EBITDA: 16% EBITDA growth driven by: - Increased A&D mix and YoY growth in exotic alloys
- EBITDA also impacted favorably by retroactive AMPC credit in Q4'24
Consolidated ATI
Revenue: 5% year-over-year sales growth driven by:
- Year over year increase of 11% in core markets, partially offset by 14% reduction in industrial market sales
- Year over year grew 9% excluding metal impacts on pass-through revenue
Note: amounts may not add due to rounding.
- Attributable to ATI
- See appendix for full reconciliation to the nearest GAAP measures
• Adjusted earnings per share declined in 2024, primarily due to higher income tax | 6 | |
expense | 6 | |
January 2019 |
Cash & Liquidity
Net Debt/Adj. EBITDA(1) Ratio: 1.6x(2)
$600 $500 $400
$MM's | $300 | ||||||||||
$200 | |||||||||||
$100 | |||||||||||
$- | |||||||||||
2025 | 2026 | 2027 | 2028 | 2029 | 2030 | 2031 | |||||
Notes | Term Loan | ||||||||||
- Adj. EBITDA based on LTM Q4'24
- See appendix for full reconciliation to the nearest GAAP measures
January 2019
Balance Sheet and Cash Flow
Q4 results
- Liquidity of ~$1.3B, including $721M of cash on hand
- Managed working capital(2) 30.9% of sales
- Capital expenditures were $47M in Q4
Capital structure
- Executing multi-year $700M share repurchase authorization
- Full year share repurchases ~5.3M shares for $260M
- Completed $70M in Q4
- $590M remaining on current authorization
- Strong balance sheet and liquidity provide for balanced capital allocation opportunities
- Fund growth
- De-leverbalance sheet
- Return capital to shareholders
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First Quarter & Full Year 2025 Outlook
First Quarter 2025
Key Assumptions
Adj. EPS (1)(3)
$0.55 - $0.61
Previously X
Adj. EBITDA (3)
$170 - $180 million
(Previously $X - $X million)
Key Drivers
- Strong demand in A&D, timing of growth in Commercial Aero accelerating in 2H 2025
- All outage recovery from 3Q '24 remains on schedule and
consistent with prior expectations
Full Year 2025
Adj. EPS (2)(3) | Adj. EBITDA (3) |
$2.80 - $3.00 $800 - $840 million
(Previously $800 - $900 million in
2023 Investor Day Targets)
FCF (3)
$240 - $360 million
- Assumes Q1 fully diluted average share count of ~145 million
- Assumes FY 2025 fully diluted average share count of ~145 million
- See appendix for reconciliation of non-GAAP financial measures
- Guidance assumes no work stoppages or impacts from changes in global trade policy
- Annual effective tax rate of 21.5 - 22.5%
Additional financial guidance and assumptions provided in Appendix 1
-
Consistent with prior assumptions
• Updated Assumption
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Additional Materials Appendix
Appendix 1 - 2025 Outlook Assumptions
Earnings Drivers | |
FY 2025 Net Interest Expense | ~$100M |
Annual Cash Flow Drivers | |
Capital Expenditures | $260-$280M |
Depreciation & Amortization | ~$168M |
Managed Working Capital(1) | Cash Usage of in Range of ~$100M |
Full Year Cash Taxes | ~$62M |
(1) See Appendix 3 for reconciliation of non-GAAP financial measures
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January 2019
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Disclaimer
ATI Inc. published this content on February 04, 2025, and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on February 04, 2025 at 13:37:56.976.