• Carpenter Technology Reports Fourth Quarter and Fiscal Year 2023 Results

    Source: Nasdaq GlobeNewswire / 27 Jul 2023 08:00:49   America/New_York

     PHILADELPHIA, July 27, 2023 (GLOBE NEWSWIRE) -- Carpenter Technology Corporation (NYSE: CRS) (the “Company”) today announced financial results for the fiscal fourth quarter and year ended June 30, 2023. For the quarter, the Company reported net income of $38.4 million, or $0.78 earnings per diluted share.

    Fourth Quarter Fiscal Year 2023 Highlights

    • Exceeded target to return to fiscal year 2019 operating income run rate by the end of fiscal year 2023
    • Achieved adjusted operating income of $62.9 million, up from $39.3 million in the previous quarter and $14.9 million in the fourth quarter of fiscal year 2022
    • Specialty Alloy Operations segment adjusted operating income reached $80.0 million, up from $49.0 million in the previous quarter and $20.0 million in the fourth quarter of fiscal year 2022
    • Net sales excluding surcharge up 14% sequentially and up 39% year-over-year
    • Generated $175 million of cash from operations, $144 million in adjusted free cash flow

    First Quarter Fiscal Year 2024 Outlook

    • Expect operating income to be in the range of $61 million to $67 million, in line with previous guidance
    • Expectations would exceed the operating income in the first quarter of fiscal year 2020, our most profitable first quarter in recent history, and be above the historical trend of a sequential seasonal decline in profits
    • With a strong first quarter, well positioned in fiscal year 2024 to take a meaningful step towards our long-term goal of doubling fiscal year 2019 operating income by fiscal year 2027
    • Exceeding targeted productivity gains could accelerate earnings growth in fiscal year 2024 versus current projections

    “More than a year ago, we set the goal to return to pre-pandemic (fiscal year 2019) profitability on a run-rate basis by the end of fiscal year 2023. We exceeded that goal in the fourth quarter,” said Tony R. Thene, President and CEO of Carpenter Technology. “Our performance was driven by increased productivity at our facilities, improved product mix and realized price increases.”

    “Notably, the Specialty Alloys Operations (“SAO”) segment demonstrated significant improvement, reaching $80.0 million of adjusted operating income, up from $49.0 million in the previous quarter and $20.0 million in the previous year quarter. SAO reached adjusted operating income margin of 16.8 percent, a meaningful increase over the previous quarter’s 11.9 percent margin."

    “In addition to the strong operating performance, we generated $144 million in adjusted free cash flow for the current fourth quarter.”

    “Returning to our pre-pandemic profitability is an important milestone on our journey to doubling our operating income by fiscal year 2027 (vs. fiscal year 2019), and we expect to continue our momentum into fiscal year 2024. For the first quarter of fiscal year 2024, we expect operating income to be in the range of $61 million to $67 million. This would exceed the first quarter of fiscal year 2020, our most profitable first quarter in recent history, and would also be a meaningful step up over the historical trend of a sequential seasonal decline in profits in the first quarter of the fiscal year.”

    “We are well-positioned to realize our target: we are operating in a strong demand environment in which our customers want more material, sooner, resulting in record backlogs. We are increasing our productivity across facilities, as evidenced by our performance in the fourth quarter of fiscal year 2023, and we are actively managing our preventive maintenance schedules to protect our unique assets, serve our customers and maximize shipments.”

    “This is an exciting time at Carpenter Technology. Macro trends are increasing demand across our end-use markets for our broad portfolio of specialized solutions. We have leading capabilities and capacity with a difficult-to-replicate system of assets, and we continue to drive improved productivity to capture the demand.”


    Financial Highlights

      Q4 Q4 YTD YTD
    ($ in millions except per share amounts) FY2023 FY2022 FY2023 FY2022
    Net sales $758.1 $563.8 $2,550.3  $1,836.3 
    Net sales excluding surcharge (a) $560.0 $403.2 $1,848.0  $1,400.0 
    Operating income (loss) $62.9 $24.6 $133.1  $(24.9)
    Adjusted operating income (loss) excluding special items (a) $62.9 $14.9 $133.1  $(34.0)
    Net income (loss) $38.4 $2.6 $56.4  $(49.1)
    Earnings (loss) per diluted share $0.78 $0.05 $1.14  $(1.01)
    Adjusted earnings (loss) per diluted share (a) $0.78 $0.00 $1.14  $(1.06)
    Net cash provided from operating activities $174.9 $106.9 $14.7  $6.0 
    Adjusted free cash flow (a) $144.1 $74.4 $(67.6) $(83.1)
             
    (a) non-GAAP financial measures explained in the attached tables  


    Net sales for the fourth quarter of fiscal year 2023 were $758.1 million compared with $563.8 million in the fourth quarter of fiscal year 2022, an increase of $194.3 million (or 34 percent), on 19 percent higher shipment volume. Net sales excluding surcharge were $560.0 million, an increase of $156.8 million (or 39 percent) from the same period a year ago.

    Operating income for the fourth quarter of fiscal year 2023 was $62.9 million compared to operating income of $24.6 million in the prior year period. These results primarily reflect strong commercial execution and improved end-use market conditions compared to the prior year period.

    Earnings for the fourth quarter of fiscal year 2023 was $0.78 per diluted share compared to $0.05 per diluted share in the prior year quarter. Excluding special items, adjusted earnings per diluted share in the fourth quarter of fiscal year 2022 was $0.00. The increase in earnings per share is driven by significantly higher profitability due to increased volume, improving product mix and higher selling prices.

    Cash provided from operating activities in the fourth quarter of fiscal year 2023 was $174.9 million, compared to $106.9 million in the same quarter last year. The increase in operating cash flow primarily reflects higher earnings and inventory reductions during the current quarter. Adjusted free cash flow in the fourth quarter of fiscal year 2023 was $144.1 million, compared to $74.4 million in the same quarter last year. The increase in adjusted free cash flow was primarily due to higher cash from operating activities in the current quarter. Capital expenditures were $30.8 million in the fourth quarter of fiscal year 2023 compared to $32.8 million in the same quarter last year.

    Total liquidity, including cash and available revolver balance, was $392.8 million at the end of the fourth quarter of fiscal year 2023. This consisted of $44.5 million of cash and $348.3 million of available borrowings under the Company’s credit facility.

    Conference Call and Webcast Presentation

    Carpenter Technology will host a conference call and webcast presentation today, July 27th at 10:00 a.m. ET, to discuss the financial results of operations for the fourth quarter and full fiscal year 2023. Please dial +1 412-317-9259 for access to the live conference call. Access to the live webcast will be available at Carpenter Technology’s website (http://www.carpentertechnology.com), and a replay will soon be made available at http://www.carpentertechnology.com. Presentation materials used during this conference call will be available for viewing and download at http://www.carpentertechnology.com.

    Non-GAAP Financial Measures

    This press release includes discussions of financial measures that have not been determined in accordance with U.S. Generally Accepted Accounting Principles (GAAP). A reconciliation of the non-GAAP financial measures to their most directly comparable financial measures prepared in accordance with GAAP, accompanied by reasons why the Company believes the non-GAAP measures are important, are included in the attached schedules.

    About Carpenter Technology

    Carpenter Technology Corporation is a recognized leader in high-performance specialty alloy-based materials and process solutions for critical applications in the aerospace, defense, medical, transportation, energy, industrial, and consumer electronics markets. Founded in 1889, Carpenter Technology has evolved to become a pioneer in premium specialty alloys, including titanium, nickel, and cobalt, as well as alloys specifically engineered for additive manufacturing (AM) processes and soft magnetics applications. Carpenter Technology has expanded its AM capabilities to provide a complete “end-to-end” solution to accelerate materials innovation and streamline parts production. More information about Carpenter Technology can be found at www.carpentertechnology.com.

    Forward-Looking Statements

    This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Act of 1995. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ from those projected, anticipated or implied. The most significant of these uncertainties are described in Carpenter Technology’s filings with the Securities and Exchange Commission, including its report on Form 10-K for the fiscal year ended June 30, 2022, Form 10-Q for the fiscal quarters ended September 30, 2022, December 31, 2022, and March 31, 2023, and the exhibits attached to those filings. They include but are not limited to: (1) the cyclical nature of the specialty materials business and certain end-use markets, including aerospace, defense, medical, transportation, energy, industrial and consumer, or other influences on Carpenter Technology's business such as new competitors, the consolidation of competitors, customers, and suppliers or the transfer of manufacturing capacity from the United States to foreign countries; (2) the ability of Carpenter Technology to achieve cash generation, growth, earnings, profitability, operating income, cost savings and reductions, qualifications, productivity improvements or process changes; (3) the ability to recoup increases in the cost of energy, raw materials, freight or other factors; (4) domestic and foreign excess manufacturing capacity for certain metals; (5) fluctuations in currency exchange rates; (6) the effect of government trade actions; (7) the valuation of the assets and liabilities in Carpenter Technology's pension trusts and the accounting for pension plans; (8) possible labor disputes or work stoppages; (9) the potential that our customers may substitute alternate materials or adopt different manufacturing practices that replace or limit the suitability of our products; (10) the ability to successfully acquire and integrate acquisitions; (11) the availability of credit facilities to Carpenter Technology, its customers or other members of the supply chain; (12) the ability to obtain energy or raw materials, especially from suppliers located in countries that may be subject to unstable political or economic conditions; (13) Carpenter Technology's manufacturing processes are dependent upon highly specialized equipment located primarily in facilities in Reading and Latrobe, Pennsylvania and Athens, Alabama for which there may be limited alternatives if there are significant equipment failures or a catastrophic event; (14) the ability to hire and retain a qualified workforce and key personnel, including members of the executive management team, management, metallurgists and other skilled personnel; (15) fluctuations in oil and gas prices and production; (16) the impact of potential cyber attacks and information technology or data security breaches; (17) inability of suppliers to meet obligations due to supply chain disruptions or otherwise; (18) inability to meet increased demand, production targets or commitments; (19) the ability to manage the impacts of natural disasters, climate change, pandemics and outbreaks of contagious diseases and other adverse public health developments, such as the COVID-19 pandemic; and (20) geopolitical, economic, and regulatory risks relating to our global business, including geopolitical and diplomatic tensions, instabilities and conflicts, such as the war in Ukraine, as well as compliance with U.S. and foreign trade and tax laws, sanctions, embargoes and other regulations. Any of these factors could have an adverse and/or fluctuating effect on Carpenter Technology's results of operations. The forward-looking statements in this document are intended to be subject to the safe harbor protection provided by Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended. We caution you not to place undue reliance on forward-looking statements, which speak only as of the date of this press release or as of the dates otherwise indicated in such forward-looking statements. Carpenter Technology undertakes no obligation to update or revise any forward-looking statements.


    PRELIMINARY
    CONSOLIDATED STATEMENTS OF OPERATIONS
    (in millions, except per share data)
    (Unaudited)

      Three Months Ended Year Ended
      June 30, June 30,
       2023  2022   2023  2022 
             
    Net sales $758.1 $563.8  $2,550.3 $1,836.3 
    Cost of sales  639.1  491.8   2,213.0  1,686.5 
    Gross profit  119.0  72.0   337.3  149.8 
             
    Selling, general and administrative expenses  56.1  47.4   204.2  174.7 
    Operating income (loss)  62.9  24.6   133.1  (24.9)
             
    Interest expense, net  14.1  13.4   54.1  44.9 
    Debt extinguishment losses, net  —  6.0   —  6.0 
    Other expense (income), net  0.2  (0.2)  6.5  (12.7)
             
    Income (loss) before income taxes  48.6  5.4   72.5  (63.1)
    Income tax expense (benefit)  10.2  2.8   16.1  (14.0)
             
    Net income (loss) $38.4 $2.6  $56.4 $(49.1)
             
    EARNINGS (LOSS) PER COMMON SHARE:        
    Basic $0.78 $0.05  $1.15 $(1.01)
    Diluted $0.78 $0.05  $1.14 $(1.01)
             
    WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:        
    Basic  48.9  48.6   48.8  48.5 
    Diluted  49.4  48.7   49.2  48.5 
             
    Cash dividends per common share $0.20 $0.20  $0.80 $0.80 




    PRELIMINARY
    CONSOLIDATED STATEMENTS OF CASH FLOWS
    (in millions)
    (Unaudited)

      Year Ended
      June 30,
       2023   2022 
    OPERATING ACTIVITIES    
    Net income (loss) $56.4  $(49.1)
    Adjustments to reconcile net income (loss) to net cash provided from operating activities:    
    Depreciation and amortization  131.0   131.4 
    Acquisition-related contingent liability release  —   (4.7)
    Debt extinguishment losses, net  —   6.0 
    Deferred income taxes  (0.4)  (3.1)
    Net pension expense (income)  19.9   (7.3)
    Share-based compensation expense  16.4   10.8 
    Net loss on disposal of property, plant, and equipment and assets held for sale  2.5   2.0 
    Changes in working capital and other:    
    Accounts receivable  (144.5)  (79.0)
    Inventories  (140.3)  (71.9)
    Other current assets  13.0   8.3 
    Accounts payable  29.2   95.7 
    Accrued liabilities  38.2   (24.5)
    Pension plan contributions  —   (0.7)
    Other postretirement plan contributions  (3.3)  (1.7)
    Other, net  (3.4)  (6.2)
    Net cash provided from operating activities  14.7   6.0 
    INVESTING ACTIVITIES    
    Purchases of property, plant, equipment and software  (82.3)  (91.3)
    Proceeds from disposals of property, plant and equipment and assets held for sale  —   2.2 
    Net cash used for investing activities  (82.3)  (89.1)
    FINANCING ACTIVITIES    
    Credit agreement borrowings  183.7   — 
    Credit agreement repayments  (183.7)  — 
    Proceeds from issuance of long-term debt, net of offering costs  —   296.6 
    Payments on long-term debt  —   (300.0)
    Payments for debt extinguishment costs, net  —   (6.0)
    Payments for debt issue costs  (1.9)  (0.8)
    Dividends paid  (39.4)  (39.2)
    Proceeds from stock options exercised  5.0   — 
    Withholding tax payments on share-based compensation awards  (3.8)  (3.4)
    Net cash used for financing activities  (40.1)  (52.8)
    Effect of exchange rate changes on cash and cash equivalents  (2.0)  2.7 
    DECREASE IN CASH AND CASH EQUIVALENTS  (109.7)  (133.2)
    Cash and cash equivalents at beginning of year  154.2   287.4 
    Cash and cash equivalents at end of year $44.5  $154.2 




    PRELIMINARY
    CONSOLIDATED BALANCE SHEETS
    (in millions)
    (Unaudited)

      June 30,
       2023   2022 
         
    ASSETS    
    Current assets:    
    Cash and cash equivalents $44.5  $154.2 
    Accounts receivable, net  531.3   382.3 
    Inventories  639.7   496.1 
    Other current assets  66.4   86.8 
    Total current assets  1,281.9   1,119.4 
    Property, plant, equipment and software, net  1,383.8   1,420.8 
    Goodwill  241.4   241.4 
    Other intangibles, net  28.7   35.2 
    Deferred income taxes  6.6   5.7 
    Other assets  111.5   109.8 
    Total assets $3,053.9  $2,932.3 
         
    LIABILITIES    
    Current liabilities:    
    Accounts payable $278.1  $242.1 
    Accrued liabilities  181.3   133.5 
    Total current liabilities  459.4   375.6 
         
    Long-term debt  693.0   691.8 
    Accrued pension liabilities  190.1   196.6 
    Accrued postretirement benefits  45.8   77.4 
    Deferred income taxes  170.3   162.4 
    Other liabilities  99.2   98.0 
    Total liabilities  1,657.8   1,601.8 
         
    STOCKHOLDERS' EQUITY    
    Common stock  280.7   280.1 
    Capital in excess of par value  328.4   320.3 
    Reinvested earnings  1,228.0   1,211.0 
    Common stock in treasury  (298.0)  (307.4)
    Accumulated other comprehensive loss  (143.0)  (173.5)
    Total stockholders' equity  1,396.1   1,330.5 
    Total liabilities and stockholders' equity $3,053.9  $2,932.3 



    PRELIMINARY
    SEGMENT FINANCIAL DATA
    (in millions, except pounds sold)
    (Unaudited)

     Three Months Ended Year Ended
     June 30, June 30,
      2023   2022   2023   2022 
            
    Pounds sold (000):       
    Specialty Alloys Operations 61,528   51,626   212,050   187,754 
    Performance Engineered Products 3,328   2,808   11,864   10,662 
    Intersegment (3,428)  (2,674)  (9,792)  (10,304)
    Consolidated pounds sold 61,428   51,760   214,122   188,112 
            
    Net sales:       
    Specialty Alloys Operations       
    Net sales excluding surcharge$477.2  $327.2  $1,540.6  $1,137.1 
    Surcharge 189.8   157.7   673.0   428.5 
    Specialty Alloys Operations net sales 667.0   484.9   2,213.6   1,565.6 
            
    Performance Engineered Products       
    Net sales excluding surcharge 107.6   92.9   397.1   336.7 
    Surcharge 11.1   2.9   36.6   7.8 
    Performance Engineered Products net sales 118.7   95.8   433.7   344.5 
            
    Intersegment       
    Net sales excluding surcharge (24.8)  (16.9)  (89.7)  (73.8)
    Surcharge (2.8)  —   (7.3)  — 
    Intersegment net sales (27.6)  (16.9)  (97.0)  (73.8)
            
    Consolidated net sales$758.1  $563.8  $2,550.3  $1,836.3 
            
    Operating income (loss):       
    Specialty Alloys Operations$80.0  $30.0  $179.1  $9.6 
    Performance Engineered Products 5.9   10.3   31.8   18.1 
    Corporate (22.5)  (15.5)  (75.5)  (52.8)
    Intersegment (0.5)  (0.2)  (2.3)  0.2 
    Consolidated operating income (loss)$62.9  $24.6  $133.1  $(24.9)


    The Company has two reportable segments, Specialty Alloys Operations (“SAO”) and Performance Engineered Products (“PEP”).

    The SAO segment is comprised of Carpenter's major premium alloy and stainless steel manufacturing operations. This includes operations performed at mills primarily in Reading and Latrobe, Pennsylvania and surrounding areas as well as South Carolina and Alabama.

    The PEP segment is comprised of the Company’s differentiated operations. This segment includes the Dynamet titanium business, the Carpenter Additive business and the Latrobe and Mexico distribution businesses. The businesses in the PEP segment are managed with an entrepreneurial structure to promote flexibility and agility to quickly respond to market dynamics. It is our belief this model will ultimately drive overall revenue and profit growth. The pounds sold data above for the PEP segment includes only the Dynamet and Additive businesses.

    Corporate costs are comprised of executive and director compensation, and other corporate facilities and administrative expenses not allocated to the segments. Also included are items that management considers not representative of ongoing operations and other specifically-identified income or expense items.

    The service cost component of net pension expense, which represents the estimated cost of future pension liabilities earned associated with active employees, is included in the operating results of the business segments. The residual net pension expense is comprised of the expected return on plan assets, interest costs on the projected benefit obligations of the plans, and amortization of actuarial gains and losses and prior service costs and is included in other expense (income), net.


    PRELIMINARY

    NON-GAAP FINANCIAL MEASURES
    (in millions, except per share data)
    (Unaudited)

    ADJUSTED OPERATING MARGIN EXCLUDING        
    SURCHARGE REVENUE AND SPECIAL ITEMS Three Months Ended Year Ended
      June 30, June 30,
       2023   2022   2023   2022 
             
    Net sales $758.1  $563.8  $2,550.3  $1,836.3 
    Less: surcharge revenue  198.1   160.6   702.3   436.3 
    Net sales excluding surcharge revenue $560.0  $403.2  $1,848.0  $1,400.0 
             
    Operating income (loss) $62.9  $24.6  $133.1  $(24.9)
             
    Special items:        
    COVID-19 costs  —   0.6   —   5.9 
    COVID-19 employee retention credits  —   (12.7)  —   (12.7)
    Acquisition-related contingent liability release  —   —   —   (4.7)
    Environmental site charge  —   2.4   —   2.4 
    Adjusted operating income (loss) $62.9  $14.9  $133.1  $(34.0)
             
    Operating margin  8.3%  4.4%  5.2% (1.4)%
             
    Adjusted operating margin excluding surcharge revenue and special items  11.2%  3.7%  7.2% (2.4)%


    Management believes that removing the impact of raw material surcharge from operating margin provides a more consistent basis for comparing results of operations from period to period, thereby permitting management to evaluate performance and investors to make decisions based on the ongoing operations of the Company. In addition, management believes that excluding the impact of special items from operating margin is helpful in analyzing the operating performance of the Company, as these items are not indicative of ongoing operating performance. Management uses its results excluding these amounts to evaluate its operating performance and to discuss its business with investment institutions, the Company’s board of directors and others.


    ADJUSTED EARNINGS PER DILUTED SHARE
    EXCLUDING SPECIAL ITEM    		 Earnings
    Before
    Income
    Taxes    		 Income Tax
    Expense    		 Net Income Earnings Per
    Diluted
    Share*
             
    Three months ended June 30, 2023, as reported $        48.6         $        (10.2) $        38.4 $        0.78        
             
    Special item:        
    None reported          —                  —                   —                  —        
    Total impact of special item          —                  —                   —                  —        
             
    Three months ended June 30, 2023, as adjusted $        48.6         $        (10.2) $        38.4 $        0.78        
             
    * Impact per diluted share calculated using weighted average common shares outstanding of 49.4 million for the three months ended June 30, 2023.


    ADJUSTED EARNINGS PER DILUTED SHARE
    EXCLUDING SPECIAL ITEMS    		 Income
    Before
    Income
    Taxes    		 Income Tax
    Expense    		 Net Income Earnings Per
    Diluted
    Share*
             
    Three months ended June 30, 2022, as reported $5.4  $(2.8) $2.6  $0.05 
             
    Special items:        
    COVID-19 costs  0.6   —   0.6   0.01 
    COVID-19 employee retention credits  (12.7)  2.8   (9.9)  (0.20)
    Environmental site charge  2.4   (0.5)  1.9   0.04 
    Debt extinguishment losses, net  6.0   (1.3)  4.7   0.10 
    Total impact of special items  (3.7)  1.0   (2.7)  (0.05)
             
    Three months ended June 30, 2022, as adjusted $1.7  $(1.8) $(0.1) $— 
             
    * Impact per diluted share calculated using weighted average common shares outstanding of 48.7 million for the three months ended June 30, 2022.


    ADJUSTED EARNINGS PER DILUTED SHARE
    EXCLUDING SPECIAL ITEM    		 Earnings
    Before
    Income
    Taxes    		 Income Tax
    Expense    		 Net Income Earnings Per
    Diluted
    Share*
             
    Year ended June 30, 2023, as reported $72.5 $(16.1) $56.4 $1.14
             
    Special item:        
    None reported  —  —   —  —
    Total impact of special item  —  —   —  —
             
    Year ended June 30, 2023, as adjusted $72.5 $(16.1) $56.4 $1.14
             
    * Impact per diluted share calculated using weighted average common shares outstanding of 49.2 million for the year ended June 30, 2023.


    ADJUSTED LOSS PER DILUTED SHARE EXCLUDING
    SPECIAL ITEMS    		 Loss Before
    Income
    Taxes    		 Income Tax
    Benefit    		 Net Loss Loss Per
    Diluted
    Share*
             
    Year ended June 30, 2022, as reported $(63.1) $14.0  $(49.1) $(1.01)
             
    Special items:        
    COVID-19 costs  5.9   (1.3)  4.6   0.08 
    COVID-19 employee retention credits  (12.7)  2.8   (9.9)  (0.20)
    Acquisition-related contingent liability release  (4.7)  1.1   (3.6)  (0.07)
    Environmental site charge  2.4   (0.5)  1.9   0.04 
    Debt extinguishment losses, net  6.0   (1.3)  4.7   0.10 
    Total impact of special items  (3.1)  0.8   (2.3)  (0.05)
             
    Year ended June 30, 2022, as adjusted $(66.2) $14.8  $(51.4) $(1.06)
             
    * Impact per diluted share calculated using weighted average common shares outstanding of 48.5 million for the year ended June 30, 2022.

    Management believes that earnings (loss) per diluted share adjusted to exclude the impact of special items is helpful in analyzing the operating performance of the Company, as these items are not indicative of ongoing operating performance. Management uses its results excluding these amounts to evaluate its operating performance and to discuss its business with investment institutions, the Company's board of directors and others.


      Three Months Ended Year Ended
      June 30, June 30,
    ADJUSTED FREE CASH FLOW  2023   2022   2023   2022 
             
    Net cash provided from operating activities $174.9  $106.9  $14.7  $6.0 
    Purchases of property, plant, equipment and software  (30.8)  (32.8)  (82.3)  (91.3)
    Proceeds from disposals of property, plant and equipment and assets held for sale  —   0.3   —   2.2 
    Adjusted free cash flow $144.1  $74.4  $(67.6) $(83.1)


    Management believes that the adjusted free cash flow measure provides useful information to investors regarding the Company's financial condition because it is a measure of cash generated which management evaluates for alternative uses. Historically, this non-GAAP financial measure included cash used for dividends paid on outstanding common stock and participating securities. Management believes that excluding cash dividends paid from adjusted free cash flow will provide a more direct comparison to operating cash flow, a GAAP-defined financial measure. Fiscal year 2022 has been reclassified to conform to the current presentation.


    PRELIMINARY
    SUPPLEMENTAL SCHEDULES
    (in millions)
    (Unaudited)

     Three Months Ended Year Ended
     June 30, June 30,
    NET SALES BY END-USE MARKET 2023  2022  2023  2022
            
    End-Use Market Excluding Surcharge Revenue:       
    Aerospace and Defense$294.2 $178.5 $919.5 $599.6
    Medical 66.6  53.7  241.3  177.2
    Transportation 36.8  32.9  121.8  125.2
    Energy 34.8  21.0  104.3  76.3
    Industrial and Consumer 96.6  82.4  339.4  297.2
    Distribution 31.0  34.7  121.7  124.5
    Total net sales excluding surcharge revenue 560.0  403.2  1,848.0  1,400.0
            
    Surcharge revenue 198.1  160.6  702.3  436.3
            
    Total net sales$758.1 $563.8 $2,550.3 $1,836.3


    Investor Inquires:         
    John Huyette                
    +1 610-208-2061          
    jhuyette@cartech.com  

    Media Inquiries:
    Heather Beardsley
    +1 610-208-2278
    hbeardsley@cartech.com


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