Allegheny Technologies Incorporated reported third quarter 2015 sales of $833 million and a net loss attributable to ATI of $145 million, or $(1.35) per share, in line with prior guidance provided on October 6, 2015. Excluding the non-cash charges for NRV inventory reserves and income tax valuation allowances, the net loss attributable to ATI was $31 million, or $(0.29) per share.
Sales declined 19 percent compared to the second quarter 2015, when ATI reported a net loss of $16 million, or $(0.15) per share.
“This was a very challenging quarter due to difficult business conditions, especially in the Flat Rolled Products segment, further weakening in demand from the oil & gas markets, and continued weak demand for forged products from the construction and mining market,” said Rich Harshman, Chairman, President and CEO. “Sales to the oil & gas market in the High Performance Materials and Components segment were down 34 percent compared to the second quarter 2015, and Flat Rolled Products segment sales to the oil & gas market were 60 percent lower as we completed shipments of a large oil & gas pipeline project early in the third quarter.”
Total segment operating results were a loss of $73 million. As previously announced, in the 2015 third quarter ATI changed the method of determining segment operating results to better reflect performance. Comparative results for prior periods also reflect this reporting change. Segment results now exclude all effects of LIFO inventory accounting and any related changes in NRV reserves currently required to offset ATI’s aggregate net debit LIFO valuation balance. This unusual situation of a LIFO balance that increases inventory value over replacement cost has developed over the past several years due to significant declines in most raw material values.