Allegheny Shares Gain Post Solid Q1 Results

  • Allegheny Technologies Inc ATI reported first-quarter sales growth of 20% year-over-year to $834.1 million, beating the consensus of $750.69 million.
  • High-Performance Materials & Components sales increased 41.8% Y/Y to $341.6 million, reflecting higher sales across nearly all end markets, led by commercial jet engines. Segment EBITDA was $68.1 million, or 19.9% of sales.
  • Advanced Alloys & Solutions sales increased 47% Y/Y to $492.5 million, and segment EBITDA was $75.32 million, or 15.3% of sales.
  • Adjusted EPS improved to $0.40 from $(0.06) in 1Q21, beating estimates of $0.20.
  • The gross margin expanded by 792 bps to 20.3%. The company reported an operating income of $77 million (+142.1% Y/Y), and the margin expanded by 464 bps to 9.2%.
  • Adjusted EBITDA doubled to $125 million and the margin expanded by 595 bps to 15%
  • Allegheny's cash used in operating activities was $(217.2) million for Q1, compared to $(68.1) million a year ago. It held cash and equivalents of $316.7 million at the end of the quarter.
  • ATI repurchased 3.5 million shares for $90 million during the quarter, averaging $25.57/Share.
  • "Looking ahead to the second quarter, we expect continued growth in our most significant end markets. In this environment, our lean cost structures will give us the advantage to improve earnings and margins versus the prior year. We'll continue to improve inventory efficiency, balanced with ensuring an adequate supply of input materials to achieve growth," commented Robert S. Wetherbee, Board Chair, President, and CEO.
  • Price Action: ATI shares are trading higher by 4.51% at $29.18 on the last check Wednesday.

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