Allegheny To Invest $95 Million For Capacity Expansion

Allegheny Technologies Incorporated's ATI board of directors approved a $95-million investment to expand its iso-thermal forging and heat-treating capacities. This self-funded project will help meet growing demand from the aerospace jet engine market.

This project represents Allegheny's fourth iso-thermal press and will be located at the company's iso-thermal forging center of excellence in Cudahy, WI. The expansion is expected to be completed within three years, post which it will fully qualify for aerospace-related production.

Further, it will enable the company to meet the increasing production requirements for existing long-term agreements with engine OEM partners. Also, the company's High Performance Materials and Components ("HPMC") segment will benefit from the expansion that will produce technologically advanced powder-to-iso-thermally-forged jet engine components.

Revenues from the company's HPMC segment rose 9% year over year to $517.7 million in the fourth quarter of 2017 on the back of higher sales of forged and cast components and nickel-based and specialty alloys.

Allegheny expects continued operating margin improvement and revenue growth in its HPMC unit in 2018 resulting from improved asset utilization and ongoing aerospace market demand growth. The company also expects its Flat-Rolled Products unit to build on the operational improvements and product mix benefits attained last year and increase operating margins.

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