Specialty alloy maker Carpenter Technology Corp. (CRS - Free Report) saw its shares slip after it revealed its expected earnings for second-quarter fiscal 2013 (ended December 31, 2012), which lagged analysts’ expectations.
Carpenter Technology said that it expects earnings of 61 cents to 62 cents per share for the quarter, up about 20% from the year-ago earnings but below the earnings of 74 cents a share recorded in first-quarter fiscal 2013. The predicted earnings trailed the Zacks Consensus Estimate of 76 cents.
Weak results from the company's Performance Engineered Products (PEP) division and soft demand for lower value mill products contributed to the sequentially lower earnings in the second quarter.
The Pennsylvania-based company’s shares fell roughly 7.5% yesterday, reflecting the disappointing earnings view.
Carpenter Technology further noted that it expects net sales of $431 million for the second quarter. That represents a 30% year over year rise and around 2% sequential decline.
While Carpenter Technology saw strong demand for its ultra-premium and premium products along with strength across its aerospace and energy end markets, the prevailing economic uncertainty hurt the demand for its low value product lines in the second quarter.
The company also lowered its operating income growth target for fiscal 2013 citing weakness in its PEP unit and softer demand for lower value mill products. It now sees a 20%-30% year-over-year rise (compared with 30% predicted earlier) in operating income for the full year. The company will announce its second quarter results on January 31.
Carpenter Technology makes specialty alloys, including stainless steels, titanium alloys and superalloys primarily for the aerospace and energy industries. It is a major player in the metallurgy industry along with Allegheny Technologies Inc. (ATI - Free Report) .
Carpenter Technology currently retains a short-term Zacks Rank #3 (Hold).