Pittsburgh, Pennsylvania-based Allegheny Technologies Inc. (ATI) announced that it completed a strategic review of its iron castings business and its fabricated components business, two small operations that were part of ATI's Engineered Products segment. As a result of this review, ATI has closed the fabricated components business and intends to divest its iron casting business. Through the first six months of 2013, these two businesses had revenues of approximately $10 million and a loss before taxes of approximately $9 million. As a result of these strategic actions, ATI will record a non-recurring pre-tax charge of approximately $9 million in the third quarter 2013, primarily related to asset impairment. Results for the fabricated components and iron castings businesses will be reported as discontinued operations beginning in the third quarter 2013.
"These strategic actions are designed to position ATI for improved financial performance in 2014 and beyond, simplify capital allocation decisions, and enhance our focus on ATI's strategic businesses," said Rich Harshman, ATI's Chairman, President and Chief Executive Officer.
Excluding discontinued operations, ATI expects third quarter 2013 sales of approximately $970 million and total segment operating profit in the range of $25 million to $30 million. Third quarter results continued to be negatively impacted by lower shipments associated with many high-value and standard products, lower base-selling prices for many products, and the impact of higher raw material input costs for products with longer manufacturing cycle times not aligned with falling raw material sales indices and surcharges, which continue to negatively impact raw materials cost recovery.