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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Carpenter Technology Corp | NYSE:CRS | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.63 | 0.62% | 102.54 | 104.25 | 100.67 | 101.91 | 1,213,733 | 00:51:48 |
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x
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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23-0458500
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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1735 Market Street, 15th Floor
Philadelphia, Pennsylvania
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19103
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer:
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x
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Accelerated filer:
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o
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Non-accelerated filer:
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o
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(Do not check if a smaller reporting company)
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Smaller reporting company:
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o
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December 31,
2016 |
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June 30,
2016 |
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ASSETS
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Current assets:
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Cash and cash equivalents
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$
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22.5
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$
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82.0
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Accounts receivable, net
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250.0
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253.6
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Inventories
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700.7
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628.7
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Other current assets
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53.0
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46.4
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Total current assets
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1,026.2
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1,010.7
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Property, plant and equipment, net
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1,322.7
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1,351.4
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Goodwill
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244.8
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244.8
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Other intangibles, net
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59.9
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63.2
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Deferred income taxes
|
7.3
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8.2
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Other assets
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116.5
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116.0
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Total assets
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$
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2,777.4
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$
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2,794.3
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LIABILITIES
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Current liabilities:
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Short-term debt
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$
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25.0
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$
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—
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Accounts payable
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167.7
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159.6
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Accrued liabilities
|
119.4
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139.2
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Total current liabilities
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312.1
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298.8
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Long-term debt
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604.0
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611.3
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Accrued pension liabilities
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405.3
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509.3
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Accrued postretirement benefits
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117.8
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116.6
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Deferred income taxes
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164.1
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102.4
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Other liabilities
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43.8
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51.0
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Total liabilities
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1,647.1
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1,689.4
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Contingencies and commitments (see Note 8)
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STOCKHOLDERS’ EQUITY
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Common stock — authorized 100,000,000 shares; issued 55,334,124 shares at December 31, 2016 and 55,254,569 shares at June 30, 2016; outstanding 46,717,339 shares at December 31, 2016 and 46,600,125 shares at June 30, 2016
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276.7
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276.3
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Capital in excess of par value
|
280.2
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273.5
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Reinvested earnings
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1,292.7
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1,308.9
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Common stock in treasury (8,616,785 shares and 8,654,444 shares at December 31, 2016 and June 30, 2016, respectively), at cost
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(342.4
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)
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(343.9
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)
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Accumulated other comprehensive loss
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(376.9
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)
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(409.9
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)
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Total stockholders' equity
|
1,130.3
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1,104.9
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Total liabilities and stockholders' equity
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$
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2,777.4
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$
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2,794.3
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Three Months Ended
December 31, |
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Six Months Ended
December 31, |
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2016
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2015
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2016
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2015
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||||||||
Net sales
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$
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427.4
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$
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443.8
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$
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816.3
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$
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899.4
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Cost of sales
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364.9
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377.5
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707.8
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764.5
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Gross profit
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62.5
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66.3
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108.5
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134.9
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Selling, general and administrative expenses
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47.1
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44.5
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91.7
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87.8
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Restructuring charges
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—
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—
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—
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0.4
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Operating income
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15.4
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21.8
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16.8
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46.7
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Interest expense
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(7.4
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)
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(7.0
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)
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(14.8
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)
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(13.6
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)
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Other income (expense), net
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0.3
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0.3
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1.0
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(1.9
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)
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Income before income taxes
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8.3
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15.1
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3.0
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31.2
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Income tax expense
|
1.3
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3.6
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2.2
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10.8
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Net income
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$
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7.0
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$
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11.5
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$
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0.8
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$
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20.4
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||||||||
EARNINGS PER COMMON SHARE:
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Basic
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$
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0.15
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$
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0.23
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$
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0.01
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$
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0.41
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Diluted
|
$
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0.15
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$
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0.23
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$
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0.01
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$
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0.41
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||||||||
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
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Basic
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47.0
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48.8
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47.0
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49.3
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Diluted
|
47.1
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48.9
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47.1
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49.4
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Cash dividends per common share
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$
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0.18
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$
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0.18
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$
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0.36
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$
|
0.36
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|
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Three Months Ended
December 31, |
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Six Months Ended
December 31, |
||||||||||||
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2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Net income
|
$
|
7.0
|
|
|
$
|
11.5
|
|
|
$
|
0.8
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|
$
|
20.4
|
|
Other comprehensive income (loss), net of tax
|
|
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|
|
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|
|
|
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|
||||
Pension and postretirement benefits, net of tax of $(3.5), $(2.3), $(14.0) and $(4.6), respectively
|
5.7
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|
|
3.7
|
|
|
23.1
|
|
|
7.4
|
|
||||
Net gain (loss) on derivative instruments, net of tax of $(2.4), $3.4, $(8.8) and $6.8, respectively
|
3.8
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|
|
(5.7
|
)
|
|
14.6
|
|
|
(11.2
|
)
|
||||
Foreign currency translation
|
(4.0
|
)
|
|
(2.3
|
)
|
|
(4.7
|
)
|
|
(5.6
|
)
|
||||
Other comprehensive income (loss)
|
5.5
|
|
|
(4.3
|
)
|
|
33.0
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|
|
(9.4
|
)
|
||||
Comprehensive income
|
$
|
12.5
|
|
|
$
|
7.2
|
|
|
$
|
33.8
|
|
|
$
|
11.0
|
|
|
Six Months Ended
December 31, |
||||||
|
2016
|
|
2015
|
||||
OPERATING ACTIVITIES
|
|
|
|
|
|
||
Net income
|
$
|
0.8
|
|
|
$
|
20.4
|
|
Adjustments to reconcile net income to net cash (used for) provided from operating activities:
|
|
|
|
|
|
||
Depreciation and amortization
|
58.7
|
|
|
60.3
|
|
||
Deferred income taxes
|
39.1
|
|
|
2.5
|
|
||
Net pension expense
|
31.0
|
|
|
26.9
|
|
||
Share-based compensation expense
|
6.5
|
|
|
4.9
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|
||
Net loss on disposals of property and equipment
|
0.3
|
|
|
0.1
|
|
||
Changes in working capital and other:
|
|
|
|
|
|
||
Accounts receivable
|
0.8
|
|
|
33.4
|
|
||
Inventories
|
(74.2
|
)
|
|
(34.8
|
)
|
||
Other current assets
|
(5.6
|
)
|
|
(8.2
|
)
|
||
Accounts payable
|
17.2
|
|
|
(17.6
|
)
|
||
Accrued liabilities
|
3.6
|
|
|
(11.3
|
)
|
||
Pension plan contributions
|
(100.0
|
)
|
|
—
|
|
||
Other postretirement plan contributions
|
(1.8
|
)
|
|
(6.1
|
)
|
||
Other, net
|
(2.2
|
)
|
|
1.1
|
|
||
Net cash (used for) provided from operating activities
|
(25.8
|
)
|
|
71.6
|
|
||
INVESTING ACTIVITIES
|
|
|
|
|
|
||
Purchases of property, equipment and software
|
(45.1
|
)
|
|
(49.5
|
)
|
||
Proceeds from disposals of property and equipment
|
—
|
|
|
0.3
|
|
||
Other
|
—
|
|
|
4.0
|
|
||
Net cash used for investing activities
|
(45.1
|
)
|
|
(45.2
|
)
|
||
FINANCING ACTIVITIES
|
|
|
|
|
|
||
Net change in short-term debt
|
25.0
|
|
|
39.5
|
|
||
Dividends paid
|
(17.0
|
)
|
|
(17.9
|
)
|
||
Purchases of treasury stock
|
—
|
|
|
(96.3
|
)
|
||
Payments on seller financed debt related to purchase of software
|
—
|
|
|
(2.5
|
)
|
||
Tax benefits on share-based compensation
|
0.3
|
|
|
—
|
|
||
Proceeds from stock options exercised
|
1.8
|
|
|
0.2
|
|
||
Net cash provided from (used for) financing activities
|
10.1
|
|
|
(77.0
|
)
|
||
Effect of exchange rate changes on cash and cash equivalents
|
1.3
|
|
|
1.7
|
|
||
DECREASE IN CASH AND CASH EQUIVALENTS
|
(59.5
|
)
|
|
(48.9
|
)
|
||
Cash and cash equivalents at beginning of period
|
82.0
|
|
|
70.0
|
|
||
Cash and cash equivalents at end of period
|
$
|
22.5
|
|
|
$
|
21.1
|
|
SUPPLEMENTAL CASH FLOW INFORMATION:
|
|
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|
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|
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Non-cash investing activities:
|
|
|
|
|
|
||
Acquisition of property, equipment and software
|
$
|
6.0
|
|
|
$
|
5.7
|
|
|
Common Stock
|
|
Reinvested Earnings
|
|
Common Stock in Treasury
|
|
Accumulated Other Comprehensive (Loss) Income
|
|
Total Equity
|
||||||||||||||
|
Par Value Of $5
|
|
Capital in Excess of Par Value
|
|
|
|
|
||||||||||||||||
Balances at June 30, 2016
|
$
|
276.3
|
|
|
$
|
273.5
|
|
|
$
|
1,308.9
|
|
|
$
|
(343.9
|
)
|
|
$
|
(409.9
|
)
|
|
$
|
1,104.9
|
|
Net income
|
|
|
|
|
|
|
0.8
|
|
|
|
|
|
|
|
|
0.8
|
|
||||||
Pension and postretirement benefits gain, net of tax
|
|
|
|
|
|
|
|
|
|
|
|
|
23.1
|
|
|
23.1
|
|
||||||
Net gain on derivative instruments, net of tax
|
|
|
|
|
|
|
|
|
|
|
|
|
14.6
|
|
|
14.6
|
|
||||||
Foreign currency translation
|
|
|
|
|
|
|
|
|
|
|
|
|
(4.7
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)
|
|
(4.7
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)
|
||||||
Cash Dividends:
|
|
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|
0
|
|
||||||
Common @ $0.36 per share
|
|
|
|
|
|
|
(17.0
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)
|
|
|
|
|
|
|
|
(17.0
|
)
|
||||||
Share-based compensation plans
|
|
|
|
5.0
|
|
|
|
|
|
1.5
|
|
|
|
|
|
6.5
|
|
||||||
Stock options exercised
|
0.4
|
|
|
1.4
|
|
|
|
|
|
|
|
|
|
|
|
1.8
|
|
||||||
Tax windfall on share-based compensation
|
|
|
|
0.3
|
|
|
|
|
|
|
|
|
|
|
|
0.3
|
|
||||||
Balances at December 31, 2016
|
$
|
276.7
|
|
|
$
|
280.2
|
|
|
$
|
1,292.7
|
|
|
$
|
(342.4
|
)
|
|
$
|
(376.9
|
)
|
|
$
|
1,130.3
|
|
|
Common Stock
|
|
Reinvested Earnings
|
|
Common Stock in Treasury
|
|
Accumulated Other Comprehensive (Loss) Income
|
|
Total Equity
|
||||||||||||||
|
Par Value Of $5
|
|
Capital in Excess of Par Value
|
|
|
|
|
||||||||||||||||
Balances at June 30, 2015
|
$
|
276.2
|
|
|
$
|
266.6
|
|
|
$
|
1,332.4
|
|
|
$
|
(221.1
|
)
|
|
$
|
(328.2
|
)
|
|
$
|
1,325.9
|
|
Net income
|
|
|
|
|
|
|
20.4
|
|
|
|
|
|
|
|
|
20.4
|
|
||||||
Pension and postretirement benefits gain, net of tax
|
|
|
|
|
|
|
|
|
|
|
|
|
7.4
|
|
|
7.4
|
|
||||||
Net loss on derivative instruments, net of tax
|
|
|
|
|
|
|
|
|
|
|
|
|
(11.2
|
)
|
|
(11.2
|
)
|
||||||
Foreign currency translation
|
|
|
|
|
|
|
|
|
|
|
|
|
(5.6
|
)
|
|
(5.6
|
)
|
||||||
Cash Dividends:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
0
|
|
||||||
Common @ $0.36 per share
|
|
|
|
|
|
|
(17.9
|
)
|
|
|
|
|
|
|
|
(17.9
|
)
|
||||||
Purchase of treasury stock
|
|
|
|
|
|
|
(96.3
|
)
|
|
|
|
(96.3
|
)
|
||||||||||
Share-based compensation plans
|
|
|
|
4.7
|
|
|
|
|
|
0.5
|
|
|
|
|
|
5.2
|
|
||||||
Stock options exercised
|
|
|
|
0.2
|
|
|
|
|
|
|
|
|
|
|
|
0.2
|
|
||||||
Tax shortfall on share-based compensation
|
|
|
|
(0.1
|
)
|
|
|
|
|
|
|
|
|
|
|
(0.1
|
)
|
||||||
Balances at December 31, 2015
|
$
|
276.2
|
|
|
$
|
271.4
|
|
|
$
|
1,334.9
|
|
|
$
|
(316.9
|
)
|
|
$
|
(337.6
|
)
|
|
$
|
1,228.0
|
|
1.
|
Basis of Presentation
|
2.
|
Restructuring and Asset Impairment Charges
|
($ in millions)
|
|
|
||
Reserve balance at June 30, 2015
|
|
$
|
2.3
|
|
Restructuring and asset impairment charges
|
|
18.0
|
|
|
Payments from qualified pension plan associated with restructuring charges
|
|
(9.4
|
)
|
|
Cash payments
|
|
(3.0
|
)
|
|
Non-cash asset impairment charges and other
|
|
(7.6
|
)
|
|
Reserve balance at June 30, 2016
|
|
0.3
|
|
|
Cash payments
|
|
(0.3
|
)
|
|
Reserve balance at December 31, 2016
|
|
$
|
—
|
|
3.
|
Earnings per Common Share
|
|
|
Three Months Ended
December 31, |
|
Six Months Ended
December 31, |
||||||||||||
(in millions, except per share data)
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Net income
|
|
$
|
7.0
|
|
|
$
|
11.5
|
|
|
$
|
0.8
|
|
|
$
|
20.4
|
|
Less: earnings and dividends allocated to participating securities
|
|
(0.1
|
)
|
|
—
|
|
|
(0.1
|
)
|
|
(0.1
|
)
|
||||
Earnings available for common stockholders used in calculation of basic earnings per common share
|
|
$
|
6.9
|
|
|
$
|
11.5
|
|
|
$
|
0.7
|
|
|
$
|
20.3
|
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average number of common shares outstanding, basic
|
|
47.0
|
|
|
48.8
|
|
|
47.0
|
|
|
49.3
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Basic earnings per common share
|
|
$
|
0.15
|
|
|
$
|
0.23
|
|
|
$
|
0.01
|
|
|
$
|
0.41
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net income
|
|
$
|
7.0
|
|
|
$
|
11.5
|
|
|
$
|
0.8
|
|
|
$
|
20.4
|
|
Less: earnings and dividends allocated to participating securities
|
|
(0.1
|
)
|
|
—
|
|
|
(0.1
|
)
|
|
(0.1
|
)
|
||||
Earnings available for common stockholders used in calculation of diluted earnings per common share
|
|
$
|
6.9
|
|
|
$
|
11.5
|
|
|
$
|
0.7
|
|
|
$
|
20.3
|
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average number of common shares outstanding, basic
|
|
47.0
|
|
|
48.8
|
|
|
47.0
|
|
|
49.3
|
|
||||
Effect of shares issuable under share-based compensation plans
|
|
0.1
|
|
|
0.1
|
|
|
0.1
|
|
|
0.1
|
|
||||
Weighted average number of common shares outstanding, diluted
|
|
47.1
|
|
|
48.9
|
|
|
47.1
|
|
|
49.4
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Diluted earnings per common share
|
|
$
|
0.15
|
|
|
$
|
0.23
|
|
|
$
|
0.01
|
|
|
$
|
0.41
|
|
|
|
Three Months Ended
December 31, |
|
Six Months Ended
December 31, |
||||||||
(in millions)
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||
Stock options
|
|
2.0
|
|
|
1.5
|
|
|
1.8
|
|
|
1.4
|
|
4.
|
Inventories
|
($ in millions)
|
|
December 31,
2016 |
|
June 30,
2016 |
||||
Raw materials and supplies
|
|
$
|
152.5
|
|
|
$
|
137.6
|
|
Work in process
|
|
357.3
|
|
|
298.9
|
|
||
Finished and purchased products
|
|
190.9
|
|
|
192.2
|
|
||
Total inventory
|
|
$
|
700.7
|
|
|
$
|
628.7
|
|
5.
|
Accrued Liabilities
|
($ in millions)
|
|
December 31,
2016 |
|
June 30,
2016 |
||||
Accrued compensation and benefits
|
|
$
|
43.0
|
|
|
$
|
41.8
|
|
Derivative financial instruments
|
|
15.2
|
|
|
31.6
|
|
||
Accrued postretirement benefits
|
|
13.7
|
|
|
13.8
|
|
||
Accrued interest expense
|
|
11.3
|
|
|
11.2
|
|
||
Other
|
|
36.2
|
|
|
40.8
|
|
||
Total accrued liabilities
|
|
$
|
119.4
|
|
|
$
|
139.2
|
|
6.
|
Pension and Other Postretirement Benefits
|
Three months ended December 31,
|
|
Pension Plans
|
|
Other Postretirement Plans
|
||||||||||||
($ in millions)
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Service cost
|
|
$
|
7.7
|
|
|
$
|
7.8
|
|
|
$
|
0.9
|
|
|
$
|
0.8
|
|
Interest cost
|
|
12.4
|
|
|
14.4
|
|
|
2.3
|
|
|
2.5
|
|
||||
Expected return on plan assets
|
|
(16.6
|
)
|
|
(16.4
|
)
|
|
(1.7
|
)
|
|
(1.7
|
)
|
||||
Amortization of net loss
|
|
9.5
|
|
|
6.8
|
|
|
0.8
|
|
|
0.7
|
|
||||
Amortization of prior service cost (benefit)
|
|
0.5
|
|
|
0.1
|
|
|
(1.6
|
)
|
|
(1.6
|
)
|
||||
Net periodic benefit costs
|
|
$
|
13.5
|
|
|
$
|
12.7
|
|
|
$
|
0.7
|
|
|
$
|
0.7
|
|
Six months ended December 31,
|
|
Pension Plans
|
|
Other Postretirement Plans
|
||||||||||||
($ in millions)
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Service cost
|
|
$
|
16.0
|
|
|
$
|
15.6
|
|
|
$
|
1.8
|
|
|
$
|
1.7
|
|
Interest cost
|
|
25.3
|
|
|
28.8
|
|
|
4.6
|
|
|
5.2
|
|
||||
Expected return on plan assets
|
|
(31.9
|
)
|
|
(32.9
|
)
|
|
(3.4
|
)
|
|
(3.5
|
)
|
||||
Amortization of net loss
|
|
18.9
|
|
|
13.7
|
|
|
1.6
|
|
|
1.4
|
|
||||
Amortization of prior service cost (benefit)
|
|
0.8
|
|
|
0.2
|
|
|
(3.2
|
)
|
|
(3.3
|
)
|
||||
Curtailment charge
|
|
0.5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Net periodic benefit costs
|
|
$
|
29.6
|
|
|
$
|
25.4
|
|
|
$
|
1.4
|
|
|
$
|
1.5
|
|
7.
|
Debt
|
($ in millions)
|
|
December 31,
2016 |
|
June 30,
2016 |
||||
Medium-term notes, Series B at 6.97% to 7.10% due from April 2018 to May 2018 (face value of $55.0 million at December 31, 2016 and June 30, 2016)
|
|
$
|
55.0
|
|
|
$
|
55.0
|
|
Senior unsecured notes, 5.20% due July 2021 (face value of $250.0 million at December 31, 2016 and June 30, 2016)
|
|
250.3
|
|
|
257.8
|
|
||
Senior unsecured notes, 4.45% due March 2023 (face value of $300.0 million at December 31, 2016 and June 30, 2016)
|
|
298.7
|
|
|
298.5
|
|
||
Total
|
|
604.0
|
|
|
611.3
|
|
||
Less: amounts due within one year
|
|
—
|
|
|
—
|
|
||
Long-term debt, net of current portion
|
|
$
|
604.0
|
|
|
$
|
611.3
|
|
8.
|
Contingencies and Commitments
|
9.
|
Share Repurchase Program
|
10.
|
Fair Value Measurements
|
December 31, 2016
|
|
Fair Value
Measurements Using
Input Type
|
||
($ in millions)
|
|
Level 2
|
||
Assets:
|
|
|
|
|
Marketable securities:
|
|
|
|
|
Municipal auction rate securities
|
|
$
|
4.2
|
|
Derivative financial instruments
|
|
5.5
|
|
|
Total assets
|
|
$
|
9.7
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
Derivative financial instruments
|
|
$
|
18.9
|
|
June 30, 2016
|
|
Fair Value
Measurements Using
Input Type
|
||
($ in millions)
|
|
Level 2
|
||
Assets:
|
|
|
|
|
Marketable securities:
|
|
|
|
|
Municipal auction rate securities
|
|
$
|
4.1
|
|
Derivative financial instruments
|
|
11.8
|
|
|
Total assets
|
|
$
|
15.9
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
Derivative financial instruments
|
|
$
|
43.9
|
|
|
|
December 31, 2016
|
|
June 30, 2016
|
||||||||||||
($ in millions)
|
|
Carrying
Value
|
|
Fair
Value
|
|
Carrying
Value
|
|
Fair
Value
|
||||||||
Long-term debt
|
|
$
|
604.0
|
|
|
$
|
596.6
|
|
|
$
|
611.3
|
|
|
$
|
597.7
|
|
Company-owned life insurance
|
|
$
|
14.6
|
|
|
$
|
14.6
|
|
|
$
|
14.0
|
|
|
$
|
14.0
|
|
11
.
|
Derivatives and Hedging Activities
|
December 31, 2016
|
|
Interest
Rate Swaps
|
|
Foreign
Currency
Contracts
|
|
Commodity
Contracts
|
|
Total
Derivatives
|
||||||||
($ in millions)
|
|
|
|
|
||||||||||||
Asset Derivatives:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other current assets
|
|
$
|
0.9
|
|
|
$
|
1.0
|
|
|
$
|
1.4
|
|
|
$
|
3.3
|
|
Other assets
|
|
2.1
|
|
|
—
|
|
|
0.1
|
|
|
2.2
|
|
||||
Total asset derivatives
|
|
$
|
3.0
|
|
|
$
|
1.0
|
|
|
$
|
1.5
|
|
|
$
|
5.5
|
|
Liability Derivatives:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Accrued liabilities
|
|
$
|
—
|
|
|
$
|
0.1
|
|
|
$
|
15.1
|
|
|
$
|
15.2
|
|
Other liabilities
|
|
—
|
|
|
—
|
|
|
3.7
|
|
|
3.7
|
|
||||
Total liability derivatives
|
|
$
|
—
|
|
|
$
|
0.1
|
|
|
$
|
18.8
|
|
|
$
|
18.9
|
|
June 30, 2016
|
|
Interest
Rate Swaps
|
|
Foreign
Currency
Contracts
|
|
Commodity
Contracts
|
|
Total
Derivatives
|
||||||||
($ in millions)
|
|
|
|
|
||||||||||||
Asset Derivatives:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other current assets
|
|
$
|
1.2
|
|
|
$
|
0.3
|
|
|
$
|
0.6
|
|
|
$
|
2.1
|
|
Other assets
|
|
9.7
|
|
|
—
|
|
|
—
|
|
|
9.7
|
|
||||
Total asset derivatives
|
|
$
|
10.9
|
|
|
$
|
0.3
|
|
|
$
|
0.6
|
|
|
$
|
11.8
|
|
Liability Derivatives:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Accrued liabilities
|
|
$
|
—
|
|
|
$
|
0.3
|
|
|
$
|
31.3
|
|
|
$
|
31.6
|
|
Other liabilities
|
|
—
|
|
|
—
|
|
|
12.3
|
|
|
12.3
|
|
||||
Total liability derivatives
|
|
$
|
—
|
|
|
$
|
0.3
|
|
|
$
|
43.6
|
|
|
$
|
43.9
|
|
|
|
Amount of (Loss) Gain
Recognized in AOCI on Derivatives (Effective Portion) |
||||||||||||||
|
|
Three Months Ended
December 31, |
|
Six Months Ended
December 31, |
||||||||||||
($ in millions)
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Derivatives in Cash Flow Hedging Relationship:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Commodity contracts
|
|
$
|
(22.5
|
)
|
|
$
|
(20.2
|
)
|
|
$
|
(15.4
|
)
|
|
$
|
(38.7
|
)
|
Foreign exchange contracts
|
|
0.6
|
|
|
0.3
|
|
|
0.6
|
|
|
0.5
|
|
||||
Total
|
|
$
|
(21.9
|
)
|
|
$
|
(19.9
|
)
|
|
$
|
(14.8
|
)
|
|
$
|
(38.2
|
)
|
($ in millions)
|
|
Location of (Loss) Gain
Reclassified from AOCI into
Income
|
|
Amount of (Loss) Gain
Reclassified from AOCI
into Income
(Effective Portion)
|
|
Amount of Gain
Reclassified from AOCI into Income (Ineffective Portion) |
||||||||||||
|
|
Three Months Ended
December 31, |
|
Three Months Ended
December 31, |
||||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||||
Derivatives in Cash Flow Hedging Relationship:
|
|
|
|
|
|
|
|
|
||||||||||
Commodity contracts
|
|
Cost of sales
|
|
$
|
(7.9
|
)
|
|
$
|
(11.1
|
)
|
|
$
|
—
|
|
|
$
|
1.0
|
|
Foreign exchange contracts
|
|
Net sales
|
|
0.5
|
|
|
0.2
|
|
|
—
|
|
|
—
|
|
||||
Forward interest rate swaps
|
|
Interest expense
|
|
0.1
|
|
|
0.1
|
|
|
—
|
|
|
—
|
|
||||
Total
|
|
|
|
$
|
(7.3
|
)
|
|
$
|
(10.8
|
)
|
|
$
|
—
|
|
|
$
|
1.0
|
|
($ in millions)
|
|
Location of (Loss) Gain
Reclassified from AOCI into Income |
|
Amount of (Loss) Gain
Reclassified from AOCI into Income (Effective Portion) |
|
Amount of Gain
Reclassified from AOCI into Income (Ineffective Portion) |
||||||||||||
|
|
Six Months Ended
December 31, |
|
Six Months Ended
December 31, |
||||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||||
Derivatives in Cash Flow Hedging Relationship:
|
|
|
|
|
|
|
|
|
||||||||||
Commodity contracts
|
|
Cost of sales
|
|
$
|
(18.0
|
)
|
|
$
|
(20.5
|
)
|
|
$
|
0.5
|
|
|
$
|
1.0
|
|
Foreign exchange contracts
|
|
Net sales
|
|
0.6
|
|
|
0.1
|
|
|
—
|
|
|
—
|
|
||||
Forward interest rate swaps
|
|
Interest expense
|
|
0.2
|
|
|
0.2
|
|
|
—
|
|
|
—
|
|
||||
Total
|
|
|
|
$
|
(17.2
|
)
|
|
$
|
(20.2
|
)
|
|
$
|
0.5
|
|
|
$
|
1.0
|
|
12.
|
Other Income (Expense), Net
|
|
|
Three Months Ended
December 31, |
|
Six Months Ended
December 31, |
||||||||||||
($ in millions)
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Foreign exchange
|
|
$
|
(0.2
|
)
|
|
$
|
(0.8
|
)
|
|
$
|
(0.2
|
)
|
|
$
|
(2.0
|
)
|
Unrealized gains (losses) on company-owned life insurance contracts and investments held in rabbi trusts
|
|
0.3
|
|
|
0.7
|
|
|
0.8
|
|
|
(0.6
|
)
|
||||
Equity in earnings of unconsolidated subsidiaries
|
|
—
|
|
|
0.3
|
|
|
—
|
|
|
0.6
|
|
||||
Other
|
|
0.2
|
|
|
0.1
|
|
|
0.4
|
|
|
0.1
|
|
||||
Total other income (expense), net
|
|
$
|
0.3
|
|
|
$
|
0.3
|
|
|
$
|
1.0
|
|
|
$
|
(1.9
|
)
|
13.
|
Income Taxes
|
14.
|
Business Segments
|
Segment Data
|
|
Three Months Ended
December 31, |
|
Six Months Ended
December 31, |
||||||||||||
($ in millions)
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Net Sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Specialty Alloys Operations
|
|
$
|
348.6
|
|
|
$
|
363.6
|
|
|
$
|
663.7
|
|
|
$
|
736.2
|
|
Performance Engineered Products
|
|
83.2
|
|
|
85.4
|
|
|
161.7
|
|
|
177.0
|
|
||||
Intersegment
|
|
(4.4
|
)
|
|
(5.2
|
)
|
|
(9.1
|
)
|
|
(13.8
|
)
|
||||
Consolidated net sales
|
|
$
|
427.4
|
|
|
$
|
443.8
|
|
|
$
|
816.3
|
|
|
$
|
899.4
|
|
Segment Data
|
|
Three Months Ended
December 31, |
|
Six Months Ended
December 31, |
||||||||||||
($ in millions)
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Operating Income:
|
|
|
|
|
|
|
|
|
|
|
||||||
Specialty Alloys Operations
|
|
$
|
35.6
|
|
|
$
|
41.5
|
|
|
$
|
60.6
|
|
|
$
|
82.7
|
|
Performance Engineered Products
|
|
0.8
|
|
|
(2.9
|
)
|
|
(2.0
|
)
|
|
(3.3
|
)
|
||||
Corporate costs
|
|
(16.0
|
)
|
|
(12.7
|
)
|
|
(29.8
|
)
|
|
(24.8
|
)
|
||||
Pension earnings, interest and deferrals
|
|
(5.6
|
)
|
|
(4.8
|
)
|
|
(12.7
|
)
|
|
(9.6
|
)
|
||||
Intersegment
|
|
0.6
|
|
|
0.7
|
|
|
0.7
|
|
|
1.7
|
|
||||
Consolidated operating income
|
|
$
|
15.4
|
|
|
$
|
21.8
|
|
|
$
|
16.8
|
|
|
$
|
46.7
|
|
Segment Data
|
|
Three Months Ended
December 31, |
|
Six Months Ended
December 31, |
||||||||||||
($ in millions)
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Depreciation and Amortization:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Specialty Alloys Operations
|
|
$
|
23.7
|
|
|
$
|
23.9
|
|
|
$
|
47.2
|
|
|
$
|
47.4
|
|
Performance Engineered Products
|
|
5.2
|
|
|
5.7
|
|
|
10.3
|
|
|
11.4
|
|
||||
Corporate
|
|
0.9
|
|
|
0.9
|
|
|
1.7
|
|
|
1.9
|
|
||||
Intersegment
|
|
0.1
|
|
|
(0.2
|
)
|
|
(0.5
|
)
|
|
(0.4
|
)
|
||||
Consolidated depreciation and amortization
|
|
$
|
29.9
|
|
|
$
|
30.3
|
|
|
$
|
58.7
|
|
|
$
|
60.3
|
|
Segment Data
|
|
Three Months Ended
December 31, |
|
Six Months Ended
December 31, |
||||||||||||
($ in millions)
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Capital Expenditures:
|
|
|
|
|
|
|
|
|
|
|
||||||
Specialty Alloys Operations
|
|
$
|
8.3
|
|
|
$
|
17.0
|
|
|
$
|
23.0
|
|
|
$
|
36.7
|
|
Performance Engineered Products
|
|
2.5
|
|
|
2.2
|
|
|
7.0
|
|
|
11.3
|
|
||||
Corporate
|
|
7.7
|
|
|
0.5
|
|
|
15.2
|
|
|
1.6
|
|
||||
Intersegment
|
|
—
|
|
|
(0.1
|
)
|
|
(0.1
|
)
|
|
(0.1
|
)
|
||||
Consolidated capital expenditures
|
|
$
|
18.5
|
|
|
$
|
19.6
|
|
|
$
|
45.1
|
|
|
$
|
49.5
|
|
Segment Data
|
|
December 31,
2016 |
|
June 30,
2016 |
||||
($ in millions)
|
|
|
||||||
Total Assets:
|
|
|
|
|
|
|
||
Specialty Alloys Operations
|
|
$
|
2,267.6
|
|
|
$
|
2,256.5
|
|
Performance Engineered Products
|
|
408.2
|
|
|
415.8
|
|
||
Corporate
|
|
119.8
|
|
|
151.3
|
|
||
Intersegment
|
|
(18.2
|
)
|
|
(29.3
|
)
|
||
Consolidated total assets
|
|
$
|
2,777.4
|
|
|
$
|
2,794.3
|
|
15.
|
Recent Accounting Pronouncements
|
16.
|
Reclassifications from Accumulated Other Comprehensive (Loss) Income
|
Three Months Ended December 31, 2016 ($ in millions) (a) |
|
Cash flow
hedging items
|
|
Pension and
other
postretirement
benefit plan
items
|
|
Unrealized
losses on
available-for-
sale securities
|
|
Foreign currency items
|
|
Total
|
||||||||||
Balance at September 30, 2016
|
|
$
|
(11.0
|
)
|
|
$
|
(326.9
|
)
|
|
$
|
(0.3
|
)
|
|
$
|
(44.2
|
)
|
|
$
|
(382.4
|
)
|
Other comprehensive loss before reclassifications
|
|
(0.6
|
)
|
|
—
|
|
|
—
|
|
|
(4.0
|
)
|
|
(4.6
|
)
|
|||||
Amounts reclassified from AOCI (b)
|
|
4.4
|
|
|
5.7
|
|
|
—
|
|
|
—
|
|
|
10.1
|
|
|||||
Net other comprehensive income (loss)
|
|
3.8
|
|
|
5.7
|
|
|
—
|
|
|
(4.0
|
)
|
|
5.5
|
|
|||||
Balance at December 31, 2016
|
|
$
|
(7.2
|
)
|
|
$
|
(321.2
|
)
|
|
$
|
(0.3
|
)
|
|
$
|
(48.2
|
)
|
|
$
|
(376.9
|
)
|
Three Months Ended December 31, 2015 ($ in millions) (a) |
|
Cash flow
hedging items
|
|
Pension and
other
postretirement
benefit plan
items
|
|
Unrealized
losses on
available-for-
sale securities
|
|
Foreign currency items
|
|
Total
|
||||||||||
Balance at September 30, 2015
|
|
$
|
(34.0
|
)
|
|
$
|
(253.1
|
)
|
|
$
|
(0.3
|
)
|
|
$
|
(45.9
|
)
|
|
$
|
(333.3
|
)
|
Other comprehensive loss before reclassifications
|
|
(12.4
|
)
|
|
—
|
|
|
—
|
|
|
(2.3
|
)
|
|
(14.7
|
)
|
|||||
Amounts reclassified from AOCI (b)
|
|
6.7
|
|
|
3.7
|
|
|
—
|
|
|
—
|
|
|
10.4
|
|
|||||
Net other comprehensive (loss) income
|
|
(5.7
|
)
|
|
3.7
|
|
|
—
|
|
|
(2.3
|
)
|
|
(4.3
|
)
|
|||||
Balance at December 31, 2015
|
|
$
|
(39.7
|
)
|
|
$
|
(249.4
|
)
|
|
$
|
(0.3
|
)
|
|
$
|
(48.2
|
)
|
|
$
|
(337.6
|
)
|
(a)
|
All amounts are net of tax. Amounts in parentheses indicate debits.
|
(b)
|
See separate table below for further details.
|
Six Months Ended December 31, 2016
($ in millions) (a) |
|
Cash flow
hedging items |
|
Pension and
other postretirement benefit plan items |
|
Unrealized
losses on available-for- sale securities |
|
Foreign currency items
|
|
Total
|
||||||||||
Balance at June 30, 2016
|
|
$
|
(21.8
|
)
|
|
$
|
(344.3
|
)
|
|
$
|
(0.3
|
)
|
|
$
|
(43.5
|
)
|
|
$
|
(409.9
|
)
|
Other comprehensive income (loss) before reclassifications
|
|
3.9
|
|
|
11.4
|
|
|
—
|
|
|
(4.7
|
)
|
|
10.6
|
|
|||||
Amounts reclassified from AOCI (b)
|
|
10.7
|
|
|
11.7
|
|
|
—
|
|
|
—
|
|
|
22.4
|
|
|||||
Net current-period other comprehensive income (loss)
|
|
14.6
|
|
|
23.1
|
|
|
—
|
|
|
(4.7
|
)
|
|
33.0
|
|
|||||
Balance at December 31, 2016
|
|
$
|
(7.2
|
)
|
|
$
|
(321.2
|
)
|
|
$
|
(0.3
|
)
|
|
$
|
(48.2
|
)
|
|
$
|
(376.9
|
)
|
Six Months Ended December 31, 2015
($ in millions) (a) |
|
Cash flow
hedging items |
|
Pension and
other postretirement benefit plan items |
|
Unrealized
losses on available-for- sale securities |
|
Foreign currency items
|
|
Total
|
||||||||||
Balance at June 30, 2015
|
|
$
|
(28.5
|
)
|
|
$
|
(256.8
|
)
|
|
$
|
(0.3
|
)
|
|
$
|
(42.6
|
)
|
|
$
|
(328.2
|
)
|
Other comprehensive (loss) before reclassifications
|
|
(23.8
|
)
|
|
—
|
|
|
—
|
|
|
(5.6
|
)
|
|
(29.4
|
)
|
|||||
Amounts reclassified from AOCI (b)
|
|
12.6
|
|
|
7.4
|
|
|
—
|
|
|
—
|
|
|
20.0
|
|
|||||
Net current-period other comprehensive (loss) income
|
|
(11.2
|
)
|
|
7.4
|
|
|
—
|
|
|
(5.6
|
)
|
|
(9.4
|
)
|
|||||
Balance at December 31, 2015
|
|
$
|
(39.7
|
)
|
|
$
|
(249.4
|
)
|
|
$
|
(0.3
|
)
|
|
$
|
(48.2
|
)
|
|
$
|
(337.6
|
)
|
($ in millions) (a)
|
|
Location of
(loss) gain
|
|
Amount Reclassified from AOCI
Three Months Ended December 31, |
|
Amount Reclassified from AOCI Six Months Ended December 31,
|
||||||||||||
Details about AOCI Components
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|||||||||
Cash flow hedging items:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Commodity contracts
|
|
Cost of sales
|
|
$
|
(7.9
|
)
|
|
$
|
(11.1
|
)
|
|
$
|
(18.0
|
)
|
|
$
|
(20.5
|
)
|
Foreign exchange contracts
|
|
Net sales
|
|
0.5
|
|
|
0.2
|
|
|
0.6
|
|
|
0.1
|
|
||||
Forward interest rate swaps
|
|
Interest expense
|
|
0.1
|
|
|
0.1
|
|
|
0.2
|
|
|
0.2
|
|
||||
|
|
Total before tax
|
|
(7.3
|
)
|
|
(10.8
|
)
|
|
(17.2
|
)
|
|
(20.2
|
)
|
||||
|
|
Tax benefit
|
|
2.9
|
|
|
4.1
|
|
|
6.5
|
|
|
7.6
|
|
||||
|
|
Net of tax
|
|
$
|
(4.4
|
)
|
|
$
|
(6.7
|
)
|
|
$
|
(10.7
|
)
|
|
$
|
(12.6
|
)
|
($ in millions) (a)
|
|
Location of
(loss) gain
|
|
Amount Reclassified from AOCI
Three Months Ended December 31, |
|
Amount Reclassified from AOCI Six Months Ended December 31,
|
||||||||||||
Details about AOCI Components
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|||||||||
Amortization of pension and other postretirement benefit plan items:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Net actuarial loss
|
|
(b)
|
|
$
|
(10.3
|
)
|
|
$
|
(7.5
|
)
|
|
$
|
(20.5
|
)
|
|
$
|
(15.1
|
)
|
Prior service cost
|
|
(b)
|
|
1.1
|
|
|
1.5
|
|
|
2.4
|
|
|
3.1
|
|
||||
Curtailment charge
|
|
(b)
|
|
—
|
|
|
—
|
|
|
(0.5
|
)
|
|
—
|
|
||||
|
|
Total before tax
|
|
(9.2
|
)
|
|
(6.0
|
)
|
|
(18.6
|
)
|
|
(12.0
|
)
|
||||
|
|
Tax benefit
|
|
3.5
|
|
|
2.3
|
|
|
6.9
|
|
|
4.6
|
|
||||
|
|
Net of tax
|
|
$
|
(5.7
|
)
|
|
$
|
(3.7
|
)
|
|
$
|
(11.7
|
)
|
|
$
|
(7.4
|
)
|
(a)
|
Amounts in parentheses indicate debits to income/loss.
|
(b)
|
These AOCI components are included in the computation of net periodic benefit cost (see Note 6. Pension and Other Postretirement Benefits for additional details).
|
17.
|
Subsequent Event
|
|
|
Three Months Ended
December 31, |
|
Six Months Ended
December 31, |
||||||||||||
($ in millions)
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Pension plans
|
|
$
|
13.5
|
|
|
$
|
12.7
|
|
|
$
|
29.6
|
|
|
$
|
25.4
|
|
Other postretirement plans
|
|
0.7
|
|
|
0.7
|
|
|
1.4
|
|
|
1.5
|
|
||||
Net periodic benefit costs
|
|
$
|
14.2
|
|
|
$
|
13.4
|
|
|
$
|
31.0
|
|
|
$
|
26.9
|
|
|
|
Three Months Ended
December 31, |
|
Six Months Ended
December 31, |
||||||||||||
($ in millions)
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Cost of sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Service cost
|
|
$
|
7.2
|
|
|
$
|
7.0
|
|
|
$
|
14.8
|
|
|
$
|
14.1
|
|
Pension earnings, interest and deferrals
|
|
3.8
|
|
|
3.3
|
|
|
8.9
|
|
|
6.6
|
|
||||
|
|
11.0
|
|
|
10.3
|
|
|
23.7
|
|
|
20.7
|
|
||||
Selling, general and administrative expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Service cost
|
|
1.4
|
|
|
1.6
|
|
|
3.0
|
|
|
3.2
|
|
||||
Pension earnings, interest and deferrals
|
|
1.8
|
|
|
1.5
|
|
|
3.8
|
|
|
3.0
|
|
||||
Curtailment charge
|
|
—
|
|
|
—
|
|
|
0.5
|
|
|
—
|
|
||||
|
|
3.2
|
|
|
3.1
|
|
|
7.3
|
|
|
6.2
|
|
||||
Net pension expense
|
|
$
|
14.2
|
|
|
$
|
13.4
|
|
|
$
|
31.0
|
|
|
$
|
26.9
|
|
|
|
Three Months Ended
December 31, |
|
$
(Decrease) Increase |
|
%
(Decrease) Increase |
|||||||||
($ in millions)
|
|
2016
|
|
2015
|
|
|
|||||||||
Aerospace and Defense
|
|
$
|
242.7
|
|
|
$
|
245.6
|
|
|
$
|
(2.9
|
)
|
|
(1
|
)%
|
Energy
|
|
30.1
|
|
|
29.3
|
|
|
0.8
|
|
|
3
|
%
|
|||
Transportation
|
|
33.5
|
|
|
39.1
|
|
|
(5.6
|
)
|
|
(14
|
)%
|
|||
Medical
|
|
26.8
|
|
|
29.4
|
|
|
(2.6
|
)
|
|
(9
|
)%
|
|||
Industrial and Consumer
|
|
66.6
|
|
|
72.1
|
|
|
(5.5
|
)
|
|
(8
|
)%
|
|||
Distribution
|
|
27.7
|
|
|
28.3
|
|
|
(0.6
|
)
|
|
(2
|
)%
|
|||
Total net sales
|
|
$
|
427.4
|
|
|
$
|
443.8
|
|
|
$
|
(16.4
|
)
|
|
(4
|
)%
|
|
|
Three Months Ended
December 31, |
|
$
(Decrease) Increase |
|
%
(Decrease) Increase |
|||||||||
($ in millions)
|
|
2016
|
|
2015
|
|
|
|||||||||
Aerospace and Defense
|
|
$
|
199.0
|
|
|
$
|
201.4
|
|
|
$
|
(2.4
|
)
|
|
(1
|
)%
|
Energy
|
|
27.1
|
|
|
25.9
|
|
|
1.2
|
|
|
5
|
%
|
|||
Transportation
|
|
28.7
|
|
|
33.3
|
|
|
(4.6
|
)
|
|
(14
|
)%
|
|||
Medical
|
|
25.1
|
|
|
27.7
|
|
|
(2.6
|
)
|
|
(9
|
)%
|
|||
Industrial and Consumer
|
|
59.2
|
|
|
62.9
|
|
|
(3.7
|
)
|
|
(6
|
)%
|
|||
Distribution
|
|
27.6
|
|
|
28.2
|
|
|
(0.6
|
)
|
|
(2
|
)%
|
|||
Total net sales excluding surcharge
|
|
$
|
366.7
|
|
|
$
|
379.4
|
|
|
$
|
(12.7
|
)
|
|
(3
|
)%
|
|
|
Three Months Ended
December 31, |
||||||
($ in millions)
|
|
2016
|
|
2015
|
||||
Net sales
|
|
$
|
427.4
|
|
|
$
|
443.8
|
|
Less: surcharge revenue
|
|
60.7
|
|
|
64.4
|
|
||
Net sales excluding surcharge revenue
|
|
$
|
366.7
|
|
|
$
|
379.4
|
|
|
|
|
|
|
||||
Gross profit
|
|
$
|
62.5
|
|
|
$
|
66.3
|
|
|
|
|
|
|
||||
Gross margin
|
|
14.6
|
%
|
|
14.9
|
%
|
||
|
|
|
|
|
||||
Gross margin excluding surcharge revenue
|
|
17.0
|
%
|
|
17.5
|
%
|
|
|
Three Months Ended
December 31, |
||||||
($ in millions)
|
|
2016
|
|
2015
|
||||
Net sales
|
|
$
|
427.4
|
|
|
$
|
443.8
|
|
Less: surcharge revenue
|
|
60.7
|
|
|
64.4
|
|
||
Net sales excluding surcharge revenue
|
|
$
|
366.7
|
|
|
$
|
379.4
|
|
|
|
|
|
|
||||
Operating income
|
|
$
|
15.4
|
|
|
$
|
21.8
|
|
Pension EID
|
|
5.6
|
|
|
4.8
|
|
||
Operating income excluding pension EID
|
|
21.0
|
|
|
26.6
|
|
||
Special items:
|
|
|
|
|
||||
Consulting costs
|
|
—
|
|
|
2.6
|
|
||
Operating income excluding pension EID and other special items
|
|
$
|
21.0
|
|
|
$
|
29.2
|
|
|
|
|
|
|
||||
Operating margin
|
|
3.6
|
%
|
|
4.9
|
%
|
||
|
|
|
|
|
||||
Operating margin excluding surcharge, pension EID and other special items
|
|
5.7
|
%
|
|
7.7
|
%
|
|
|
Three Months Ended
December 31, |
|
(Decrease) Increase |
|
%
(Decrease) Increase |
||||||
(Pounds sold, in thousands)
|
|
2016
|
|
2015
|
|
|
||||||
Specialty Alloys Operations
|
|
51,314
|
|
|
54,794
|
|
|
(3,480
|
)
|
|
(6
|
)%
|
Performance Engineered Products *
|
|
2,350
|
|
|
2,800
|
|
|
(450
|
)
|
|
(16
|
)%
|
Intersegment
|
|
(378
|
)
|
|
(666
|
)
|
|
288
|
|
|
43
|
%
|
Consolidated pounds sold
|
|
53,286
|
|
|
56,928
|
|
|
(3,642
|
)
|
|
(6
|
)%
|
|
|
Three Months Ended
December 31, |
|
$
(Decrease) Increase |
|
%
(Decrease) Increase |
|||||||||
($ in millions)
|
|
2016
|
|
2015
|
|
|
|||||||||
Specialty Alloys Operations
|
|
$
|
348.6
|
|
|
$
|
363.6
|
|
|
$
|
(15.0
|
)
|
|
(4
|
)%
|
Performance Engineered Products
|
|
83.2
|
|
|
85.4
|
|
|
(2.2
|
)
|
|
(3
|
)%
|
|||
Intersegment
|
|
(4.4
|
)
|
|
(5.2
|
)
|
|
0.8
|
|
|
15
|
%
|
|||
Total net sales
|
|
$
|
427.4
|
|
|
$
|
443.8
|
|
|
$
|
(16.4
|
)
|
|
(4
|
)%
|
|
|
Three Months Ended
December 31, |
|
$
(Decrease) Increase |
|
%
(Decrease) Increase |
|||||||||
($ in millions)
|
|
2016
|
|
2015
|
|
|
|||||||||
Specialty Alloys Operations
|
|
$
|
288.1
|
|
|
$
|
299.2
|
|
|
$
|
(11.1
|
)
|
|
(4
|
)%
|
Performance Engineered Products
|
|
83.0
|
|
|
85.2
|
|
|
(2.2
|
)
|
|
(3
|
)%
|
|||
Intersegment
|
|
(4.4
|
)
|
|
(5.0
|
)
|
|
0.6
|
|
|
12
|
%
|
|||
Total net sales excluding surcharge revenue
|
|
$
|
366.7
|
|
|
$
|
379.4
|
|
|
$
|
(12.7
|
)
|
|
(3
|
)%
|
|
|
Six Months Ended
December 31, |
|
$
Decrease
|
|
%
Decrease |
|||||||||
($ in millions)
|
|
2016
|
|
2015
|
|
|
|||||||||
Aerospace and Defense
|
|
$
|
448.9
|
|
|
$
|
483.2
|
|
|
$
|
(34.3
|
)
|
|
(7
|
)%
|
Energy
|
|
58.5
|
|
|
67.5
|
|
|
(9.0
|
)
|
|
(13
|
)%
|
|||
Transportation
|
|
68.7
|
|
|
82.7
|
|
|
(14.0
|
)
|
|
(17
|
)%
|
|||
Medical
|
|
51.4
|
|
|
58.0
|
|
|
(6.6
|
)
|
|
(11
|
)%
|
|||
Industrial and Consumer
|
|
133.0
|
|
|
149.7
|
|
|
(16.7
|
)
|
|
(11
|
)%
|
|||
Distribution
|
|
55.8
|
|
|
58.3
|
|
|
(2.5
|
)
|
|
(4
|
)%
|
|||
Total net sales
|
|
$
|
816.3
|
|
|
$
|
899.4
|
|
|
$
|
(83.1
|
)
|
|
(9
|
)%
|
|
|
Six Months Ended
December 31, |
|
$
Decrease |
|
%
Decrease |
|||||||||
($ in millions)
|
|
2016
|
|
2015
|
|
|
|||||||||
Aerospace and Defense
|
|
$
|
372.5
|
|
|
$
|
395.5
|
|
|
$
|
(23.0
|
)
|
|
(6
|
)%
|
Energy
|
|
52.8
|
|
|
58.5
|
|
|
(5.7
|
)
|
|
(10
|
)%
|
|||
Transportation
|
|
59.2
|
|
|
69.0
|
|
|
(9.8
|
)
|
|
(14
|
)%
|
|||
Medical
|
|
48.1
|
|
|
54.1
|
|
|
(6.0
|
)
|
|
(11
|
)%
|
|||
Industrial and Consumer
|
|
118.5
|
|
|
129.5
|
|
|
(11.0
|
)
|
|
(8
|
)%
|
|||
Distribution
|
|
55.5
|
|
|
58.0
|
|
|
(2.5
|
)
|
|
(4
|
)%
|
|||
Total net sales excluding surcharge
|
|
$
|
706.6
|
|
|
$
|
764.6
|
|
|
$
|
(58.0
|
)
|
|
(8
|
)%
|
|
|
Six Months Ended
December 31, |
||||||
($ in millions)
|
|
2016
|
|
2015
|
||||
Net sales
|
|
$
|
816.3
|
|
|
$
|
899.4
|
|
Less: surcharge revenue
|
|
109.7
|
|
|
134.8
|
|
||
Net sales excluding surcharge revenue
|
|
$
|
706.6
|
|
|
$
|
764.6
|
|
|
|
|
|
|
||||
Gross profit
|
|
$
|
108.5
|
|
|
$
|
134.9
|
|
|
|
|
|
|
||||
Gross margin
|
|
13.3
|
%
|
|
15.0
|
%
|
||
|
|
|
|
|
||||
Gross margin excluding surcharge revenue
|
|
15.4
|
%
|
|
17.6
|
%
|
|
|
Six Months Ended
December 31, |
||||||
($ in millions)
|
|
2016
|
|
2015
|
||||
Net sales
|
|
$
|
816.3
|
|
|
$
|
899.4
|
|
Less: surcharge revenue
|
|
109.7
|
|
|
134.8
|
|
||
Net sales excluding surcharge revenue
|
|
$
|
706.6
|
|
|
$
|
764.6
|
|
|
|
|
|
|
||||
Operating income
|
|
$
|
16.8
|
|
|
$
|
46.7
|
|
Pension EID
|
|
12.7
|
|
|
9.6
|
|
||
Operating income excluding pension EID
|
|
29.5
|
|
|
56.3
|
|
||
|
|
|
|
|
||||
Special items:
|
|
|
|
|
||||
Pension curtailment charge
|
|
0.5
|
|
|
—
|
|
||
Restructuring charges
|
|
—
|
|
|
0.4
|
|
||
Consulting costs
|
|
—
|
|
|
5.1
|
|
||
Operating income excluding pension EID and other special items
|
|
$
|
30.0
|
|
|
$
|
61.8
|
|
|
|
|
|
|
||||
Operating margin
|
|
2.1
|
%
|
|
5.2
|
%
|
||
|
|
|
|
|
||||
Operating margin excluding surcharge, pension EID and other special items
|
|
4.2
|
%
|
|
8.1
|
%
|
|
|
Six Months Ended
December 31, |
|
(Decrease) Increase |
|
%
(Decrease) Increase |
||||||
(Pounds sold, in thousands)
|
|
2016
|
|
2015
|
|
|
||||||
Specialty Alloys Operations
|
|
103,674
|
|
|
111,606
|
|
|
(7,932
|
)
|
|
(7
|
)%
|
Performance Engineered Products *
|
|
4,764
|
|
|
5,756
|
|
|
(992
|
)
|
|
(17
|
)%
|
Intersegment
|
|
(972
|
)
|
|
(2,010
|
)
|
|
1,038
|
|
|
52
|
%
|
Consolidated pounds sold
|
|
107,466
|
|
|
115,352
|
|
|
(7,886
|
)
|
|
(7
|
)%
|
|
|
Six Months Ended
December 31, |
|
$
(Decrease) Increase |
|
%
(Decrease) Increase |
|||||||||
($ in millions)
|
|
2016
|
|
2015
|
|
|
|||||||||
Specialty Alloys Operations
|
|
$
|
663.7
|
|
|
$
|
736.2
|
|
|
$
|
(72.5
|
)
|
|
(10
|
)%
|
Performance Engineered Products
|
|
161.7
|
|
|
177.0
|
|
|
(15.3
|
)
|
|
(9
|
)%
|
|||
Intersegment
|
|
(9.1
|
)
|
|
(13.8
|
)
|
|
4.7
|
|
|
34
|
%
|
|||
Total net sales
|
|
$
|
816.3
|
|
|
$
|
899.4
|
|
|
$
|
(83.1
|
)
|
|
(9
|
)%
|
|
|
Six Months Ended
December 31, |
|
$
(Decrease) Increase |
|
%
(Decrease) Increase |
|||||||||
($ in millions)
|
|
2016
|
|
2015
|
|
|
|||||||||
Specialty Alloys Operations
|
|
$
|
554.0
|
|
|
$
|
600.8
|
|
|
$
|
(46.8
|
)
|
|
(8
|
)%
|
Performance Engineered Products
|
|
161.3
|
|
|
176.6
|
|
|
(15.3
|
)
|
|
(9
|
)%
|
|||
Intersegment
|
|
(8.7
|
)
|
|
(12.8
|
)
|
|
4.1
|
|
|
32
|
%
|
|||
Total net sales excluding surcharge revenue
|
|
$
|
706.6
|
|
|
$
|
764.6
|
|
|
$
|
(58.0
|
)
|
|
(8
|
)%
|
Covenant
|
|
Covenant Requirement
|
|
Actual Ratio
|
Consolidated interest coverage
|
|
3.50 to 1.00 (minimum)
|
|
8.93 to 1.00
|
Consolidated debt to capital
|
|
55% (maximum)
|
|
35.8%
|
($ in millions, except per share amounts)
|
|
Income Before Income Taxes
|
|
Income Tax Expense
|
|
Net Income
|
|
Earnings Per Diluted Share
|
||||||||
Three months ended December 31, 2016, as reported
|
|
$
|
8.3
|
|
|
$
|
(1.3
|
)
|
|
$
|
7.0
|
|
|
$
|
0.15
|
|
|
|
|
|
|
|
|
|
|
||||||||
Special items:
|
|
|
|
|
|
|
|
|
||||||||
None reported
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Three months ended December 31, 2016, as adjusted
|
|
$
|
8.3
|
|
|
$
|
(1.3
|
)
|
|
$
|
7.0
|
|
|
$
|
0.15
|
|
($ in millions, except per share amounts)
|
|
Income Before Income Taxes
|
|
Income Tax Expense
|
|
Net Income
|
|
Earnings Per Diluted Share*
|
||||||||
Three months ended December 31, 2015, as reported
|
|
$
|
15.1
|
|
|
$
|
(3.6
|
)
|
|
$
|
11.5
|
|
|
$
|
0.23
|
|
|
|
|
|
|
|
|
|
|
||||||||
Special items:
|
|
|
|
|
|
|
|
|
||||||||
Consulting costs
|
|
2.6
|
|
|
(0.9
|
)
|
|
1.7
|
|
|
0.03
|
|
||||
Impact of tax law change
|
|
—
|
|
|
(0.8
|
)
|
|
(0.8
|
)
|
|
(0.02
|
)
|
||||
Total impact of special items
|
|
2.6
|
|
|
(1.7
|
)
|
|
0.9
|
|
|
0.01
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Three months ended December 31, 2015, as adjusted
|
|
$
|
17.7
|
|
|
$
|
(5.3
|
)
|
|
$
|
12.4
|
|
|
$
|
0.24
|
|
($ in millions, except per share amounts)
|
|
Income Before Income Taxes
|
|
Income Tax (Expense) Benefit
|
|
Net Income
|
|
Earnings Per Diluted Share*
|
||||||||
Six months ended December 31, 2016, as reported
|
|
$
|
3.0
|
|
|
$
|
(2.2
|
)
|
|
$
|
0.8
|
|
|
$
|
0.01
|
|
|
|
|
|
|
|
|
|
|
||||||||
Special items:
|
|
|
|
|
|
|
|
|
||||||||
Pension curtailment
|
|
0.5
|
|
|
(0.1
|
)
|
|
0.4
|
|
|
0.01
|
|
||||
Income tax item
|
|
—
|
|
|
2.1
|
|
|
2.1
|
|
|
0.04
|
|
||||
Total impact of special items
|
|
0.5
|
|
|
2.0
|
|
|
2.5
|
|
|
0.05
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Six months ended December 31, 2016, as adjusted
|
|
$
|
3.5
|
|
|
$
|
(0.2
|
)
|
|
$
|
3.3
|
|
|
$
|
0.06
|
|
($ in millions, except per share amounts)
|
|
Income Before Income Taxes
|
|
Income Tax (Expense) Benefit
|
|
Net Income
|
|
Earnings Per Diluted Share*
|
||||||||
Six months ended December 31, 2015, as reported
|
|
$
|
31.2
|
|
|
$
|
(10.8
|
)
|
|
$
|
20.4
|
|
|
$
|
0.41
|
|
|
|
|
|
|
|
|
|
|
||||||||
Special items:
|
|
|
|
|
|
|
|
|
||||||||
Restructuring charges
|
|
0.4
|
|
|
(0.1
|
)
|
|
0.3
|
|
|
0.01
|
|
||||
Consulting costs
|
|
5.1
|
|
|
(1.8
|
)
|
|
3.3
|
|
|
0.07
|
|
||||
Income tax item**
|
|
—
|
|
|
2.0
|
|
|
2.0
|
|
|
0.04
|
|
||||
Impact of tax law change
|
|
—
|
|
|
(0.8
|
)
|
|
(0.8
|
)
|
|
(0.02
|
)
|
||||
Total impact of special items
|
|
5.5
|
|
|
(0.7
|
)
|
|
4.8
|
|
|
0.10
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Six months ended December 31, 2015, as adjusted
|
|
$
|
36.7
|
|
|
$
|
(11.5
|
)
|
|
$
|
25.2
|
|
|
$
|
0.51
|
|
|
|
Six Months Ended
December 31, |
||||||
($ in millions)
|
|
2016
|
|
2015
|
||||
Net cash (used for) provided from operating activities
|
|
$
|
(25.8
|
)
|
|
$
|
71.6
|
|
Purchases of property, equipment and software
|
|
(45.1
|
)
|
|
(49.5
|
)
|
||
Proceeds from disposals of property and equipment
|
|
—
|
|
|
0.3
|
|
||
Other
|
|
—
|
|
|
4.0
|
|
||
Dividends paid
|
|
(17.0
|
)
|
|
(17.9
|
)
|
||
Free cash flow
|
|
$
|
(87.9
|
)
|
|
$
|
8.5
|
|
(a)
|
Evaluation of Effectiveness of Disclosure Controls and Procedures
|
(b)
|
Changes in Internal Control over Financial Reporting
|
Exhibit
No.
|
|
Description
|
|
|
|
31 (A)
|
|
Certification of President and Chief Executive Officer pursuant to Rule 13a—14(a) and Rule 15d—14(a) of the Securities Exchange Act, as amended. (filed herewith)
|
|
|
|
31 (B)
|
|
Certification of Senior Vice President and Chief Financial Officer pursuant to Rule 13a—14(a) and Rule 15d—14(a) of the Securities Exchange Act, as amended. (filed herewith)
|
|
|
|
32
|
|
Certification of President and Chief Executive Officer and Senior Vice President and Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. (filed herewith)
|
|
|
|
101
|
|
The following financial information from this Quarterly Report on Form 10-Q for the fiscal quarter ended December 31, 2016, formatted in XBRL (Extensible Business Reporting Language) and filed electronically herewith: (i) the Consolidated Balance Sheets; (ii) the Consolidated Statements of Income; (iii) the Consolidated Statements of Comprehensive Income; (iv) the Consolidated Statements of Cash Flows; (v) the Consolidated Statements of Changes in Equity; and (vi) the Notes to the Consolidated Financial Statements.
|
|
Carpenter Technology Corporation
|
|
(Registrant)
|
|
|
Date: February 2, 2017
|
/s/ Damon J. Audia
|
|
Damon J. Audia
|
|
Senior Vice President and Chief Financial Officer
|
|
|
|
(Principal Financial Officer
)
|
Exhibit
No.
|
|
Description
|
|
|
|
31 (A)
|
|
Certification of President and Chief Executive Officer pursuant to Rule 13a—14(a) and Rule 15d—14(a) of the Securities Exchange Act, as amended.
|
|
|
|
31 (B)
|
|
Certification of Senior Vice President and Chief Financial Officer pursuant to Rule 13a—14(a) and Rule 15d—14(a) of the Securities Exchange Act, as amended.
|
|
|
|
32
|
|
Certification of President and Chief Executive Officer and Senior Vice President and Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
101
|
|
The following financial information from this Quarterly Report on Form 10-Q for the fiscal quarter ended December 31, 2016, formatted in XBRL (Extensible Business Reporting Language) and filed electronically herewith: (i) the Consolidated Balance Sheets; (ii) the Consolidated Statements of Income; (iii) the Consolidated Statements of Comprehensive Income; (iv) the Consolidated Statements of Cash Flows; (v) the Consolidated Statements of Changes in Equity; and (vi) the Notes to the Consolidated Financial Statements.
|
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