SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
July 25, 2001
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(Date of Report, date of earliest event reported)
TITANIUM METALS CORPORATION
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(Exact name of Registrant as specified in its charter)
Delaware 0-28538 13-5630895
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(State or Other (Commission (IRS Employer
Jurisdiction of File Number) Identification
Incorporation) Number)
1999 Broadway, Suite 4300, Denver, CO 80202
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(Address of principal executive offices) (Zip Code)
(303) 296-5600
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(Registrant's telephone number, including area code)
Not Applicable
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(Former name or address, if changed since last report)
Item 5: Other Events
On July 20, 2001 the Registrant issued the press release attached hereto as
Exhibit 99.1, which is incorporated herein by reference. The press release
relates to an announcement by Registrant of its second quarter financial results
for 2001.
Item 7: Financial Statements, Pro Forma Financial Information and Exhibits
(c) Exhibits
Item No. Exhibit List
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99.1 Press Release dated July 20, 2001 issued by Registrant
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
TITANIUM METALS CORPORATION
(Registrant)
By: /s/ Joan H. Prusse
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Joan H. Prusse
Vice President, Deputy General Counsel
and Secretary
Date: July 25, 2001
EXHIBIT 99.1
PRESS RELEASE
FOR IMMEDIATE RELEASE: CONTACT:
Titanium Metals Corporation Mark A. Wallace
1999 Broadway, Suite 4300 Executive Vice President
Denver, Colorado 80202 and Chief Financial Officer
(303) 296-5615
TIMET ANNOUNCES SECOND QUARTER RESULTS
DENVER, COLORADO . . . July 20, 2001 . . . Titanium Metals Corporation
("TIMET") (NYSE: TIE) reported a loss before special items for the second
quarter of 2001 of $2.3 million, or $.07 per share, compared to a loss before
special items in the second quarter of 2000 of $10.1 million or $.32 per share.
TIMET's net income for the second quarter of 2001 was $29.6 million, or $.86 per
diluted share, compared to a net loss of $9.5 million or $.30 per diluted share,
for the same quarter in 2000.
Sales of $120.0 million in the second quarter of 2001 were 10% higher than
the year-ago period. This resulted principally from the net effects of a 5%
increase in mill product sales volume, a 3% decrease in mill product selling
prices (expressed in U.S. dollars using actual foreign currency exchange rates
prevailing during the respective periods) and changes in product mix. In billing
currencies (which exclude the effects of foreign currency translation), mill
product selling prices decreased 1%. Melted product (ingot and slab) sales
volume increased 15% and melted product selling prices increased 4% from
year-ago levels.
As compared to the first quarter of 2001, sales were slightly lower
reflecting a 4% decrease in mill product sales volume, a 1% increase in mill
product selling prices (expressed in U.S. dollars), and changes in product mix.
In billing currencies, mill product selling prices increased 2%. Melted product
sales volume in the second quarter of 2001 increased 1% compared to the first
quarter of 2001, while selling prices increased 2%.
TIMET's backlog at June 30, 2001 was approximately $300 million, compared
to $290 million at March 31, 2001 and $160 million at June 30, 2000.
As previously reported, the Company reached a settlement in April 2001 of
the litigation between TIMET and Boeing related to the parties' 1997 long term
purchase and supply agreement. TIMET's results for the second quarter of 2001
include pre-tax income related to the Boeing settlement of $62.7 million. Of
this amount, $73.0 million ($82.0 million cash received at settlement less $9.0
million of legal fees) is reported as other operating income and $10.3 million
of related profit sharing and other costs is included as a component of selling,
general, administrative and development expense.
The Company recently completed a study of certain manufacturing assets and
determined that such assets have been impaired. Accordingly, the Company
recorded a pretax impairment charge to cost of sales of $10.8 million in the
second quarter of 2001. The Company also completed an assessment to estimate the
range of loss it might incur in connection with the previously reported tungsten
matter. As a result, the Company recorded an additional estimated pretax charge
to cost of sales of $2.8 million in the second quarter of 2001 related to this
matter.
J. Landis Martin, Chairman and CEO of TIMET said "Operating results in the
second quarter of 2001, before special items, continued to improve in line with
our expectations. Selling price increases and higher operating levels are
driving margin improvement that should allow TIMET to return to operating
profitability. We expect shipments to increase through the balance of this year,
particularly for aerospace quality titanium products, and are opening
discussions with our customers on non-LTA orders for delivery in 2002."
The statements in this release and the conference call relating to matters
that are not historical facts are forward-looking statements that represent
management's beliefs and assumptions based on currently available information.
Forward-looking statements can be identified by the use of words such as
"believes," "intends," "may," "will," "looks," "should," "could, "
"anticipates," "expects" or comparable terminology or by discussions of strategy
or trends. Although the Company believes that the expectations reflected in such
forward-looking statements are reasonable, it cannot give any assurances that
these expectations will prove to be correct. Such statements by their nature
involve substantial risks and uncertainties that could significantly affect
expected results. Actual future results could differ materially from those
described in such forward-looking statements, and the Company disclaims any
intention or obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise. Among the
factors that could cause actual results to differ materially are risks and
uncertainties including, but not limited to, the cyclicality of the commercial
aerospace industry, the performance of aerospace manufacturers under their
long-term purchase agreements with the Company, the difficulty in forecasting
demand for titanium products, global economic conditions, global productive
capacity for titanium, changes in product pricing, the impact of long-term
contracts with vendors on the ability of the Company to reduce or increase
supply or achieve lower costs, the possibility of labor disruptions,
fluctuations in currency exchange rates, control by certain stockholders and
possible conflicts of interest, uncertainties associated with new product
development, the supply of raw materials and services, changes in raw material
and other operating costs (including energy costs) and other risks and
uncertainties included in the Company's filings with the Securities and Exchange
Commission. Should one or more of these risks materialize (or the consequences
of such a development worsen), or should the underlying assumptions prove
incorrect, actual results could differ materially from those forecasted or
expected. The Company assumes no duty to update any forward-looking statements.
As previously announced, TIMET will host a conference call to discuss its
second quarter results on Friday, July 20, 2001 at 11:00 AM (EDT). On the
conference call will be J. Landis Martin, Chairman and Chief Executive Officer,
and Mark A. Wallace, Chief Financial Officer. Participants can access the call
by dialing 800-450-0819 (domestic) and 612-332-0636 (international).
TIMET, headquartered in Denver, Colorado, is a leading worldwide integrated
producer of titanium metal products. Information on TIMET is available on the
World Wide Web at http://www.timet.com/.
o o o o o
TITANIUM METALS CORPORATION
SUMMARY OF CONSOLIDATED OPERATIONS
(In millions, except per share data)
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
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2001 2000 2001 2000
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Net sales $ 120.0 $ 108.8 $ 244.0 $ 213.5
Cost of sales 123.5 107.6 240.2 215.6
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Gross margin (3.5) 1.2 3.8 (2.1)
Selling, general, administrative and development expense 21.2 11.2 31.9 22.5
Other expense (income) (73.3) .4 (74.7) .4
Restructuring charge (credit) - (.9) (.2) 2.8
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Operating income (loss) 48.6 (9.5) 46.8 (27.8)
General corporate income 2.3 1.1 4.0 3.6
Interest expense 1.1 2.0 2.6 4.2
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Pretax income (loss) 49.8 (10.4) 48.2 (28.4)
Income tax expense (benefit) 17.5 (3.6) 16.9 (10.0)
Minority interest - Convertible Preferred Securities, net of tax 2.5 2.2 4.7 4.4
Other minority interest .2 .5 .6 .9
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Income (loss) before extraordinary item 29.6 (9.5) 26.0 (23.7)
Extraordinary item - early extinguishment of debt, net of tax - - - (.9)
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Net income (loss) $ 29.6 $ (9.5) $ 26.0 $ (24.6)
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Earnings (loss) per share:
Basic:
Before extraordinary item $ .94 $ (.30) $ .82 $ (.76)
Extraordinary item - - - (.03)
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$ .94 $ (.30) $ .82 $ (.79)
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Diluted:
Before extraordinary item $ .86 $ (.30) $ .82 $ (.76)
Extraordinary item - - - (.03)
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$ .86 $ (.30) $ .82 $ (.79)
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Weighted average shares outstanding:
Basic 31.5 31.4 31.5 31.4
Diluted 37.2 31.4 31.8 31.4
Mill product shipments:
Volume (metric tons) 3,045 2,890 6,230 5,590
Average price ($ per kilogram) $29.55 $ 28.65 $ 29.50 $ 29.70
Melted product shipments:
Volume (metric tons) 1,040 905 2,070 1,495
Average price ($ per kilogram) $ 13.90 $ 13.60 $ 14.05 $ 13.85