The following is a summary of the Carpenter Technology Corporation (CRS) Q3 2024 Earnings Call Transcript:
Financial Performance:
Carpenter Technology Corp. posted a substantial Q3 2024 financial result with $90 million adjusted operating income, marking their most profitable quarter yet.
The guidance for Q4 operating income is anticipated, with an 8% increase, to reach between $110 million and $115 million, presenting a 25% sequential improvement.
The full fiscal year adjusted operating income is set to conclude within a range of $339 million to $344 million.
SAO segment exhibited an operating income of $103.5 million, a 24% sequential improvement. Q4 anticipations for this sector range between $124 million and $127 million.
The PEP segment improved to $9.2 million operating income for Q3 from $7.1 million in Q2. Q4 predictions for PEP lie between $9.5 million to $11 million.
Business Progress:
Significant growth was observed in aerospace, defense, and medical end-use markets, with sales growing by 14% sequentially.
Aerospace and defense customers, producing 57% of revenue, witnessed a rise of 28% sequentially and 30% year-over-year.
Medical sales, covering 15% of total revenue, increased by 15% sequentially and 35% year-over-year.
With improved profitability and outlook, strategic plans for FY '27 are being expedited to be accomplished a year earlier.
The forecast for Q4 revenue stands between $110 million to $115 million, marking a 25% rise from Q3.
Looking ahead, Q1 2025 is projected to align with Q4 predictions.
They have dropped their CapEx expectations for FY24 to around $100 million in light of project delays.
The company is exploring options of capacity expansion that promises strong, quick returns.
Priorities have been set for the use of generated cash, focusing on growth projects and shareholder returns.
More details: Carpenter Technology IR
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