Slide 1: Proven to perform anywhere. Fourth Quarter 2022 Earnings
Proven to perform anywhere. Fourth Quarter 2022 Earnings February 2 nd, 2023 ATI Proprietary and Confidential ©2023 ATI. All rights reserved. 1
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains forward-looking statements. Actual results may differ materially from results anticipated in the forward-looking statements due to various known and unknown risks, many of which we are unable to predict or control. These and additional risk facto
Slide 3: Key Takeaways
Key Takeaways Performance Balance Sheet Strategic Progress A&D growth and Transformation Deploying capital for shareholder Portfolio transformation driving driving results returns, balance sheet product mix and cost benefits strengthening A&D Revenue +72% vs. Q4’21 driven by: • Titanium melt expansi
Slide 4: Strategic Markets & Diversified Applications
Strategic Markets & Diversified Applications Near-term Q4 ‘22 vs. vs. Market Market Comments Revenue Q4 ‘21 Q3 ‘22 Outlook • Continued expansion in materials and forgings, led by next generation products for narrowbody aircraft. • Sequentially lower Q4 revenue driven by year end customer inventory m
Slide 5: Well-Positioned for Sustainable Growth
Well-Positioned for Sustainable Growth Driving Value Creation Expanding Markets Medical Product Narrowbody Widebody Defense Specialty Transformation Ramp Ramp Growth Energy (Build & (Build & Metallics MRO) MRO) Fly, Float beyond Ni+Ti & Roll ESG Key capabilities: Materials science expertise and inte
Slide 6: Fourth Quarter 2022 Financial Results
Fourth Quarter 2022 Financial Results $M (excl. EPS) Q4 2022 Q4 2021 % Chg. Q3 2022 % Chg. Revenue $1,010 $765 32% $1,032 (2)% HPMC Segment Aerospace ramp driving continued strength HPMC Segment $446 $314 42% $458 (3)% • Revenue: Strong year-over-year growth in jet engine materials and forgings, as
Slide 7: Full Year 2022 Financial Results
Full Year 2022 Financial Results $M (excl. EPS) FY 2022 FY 2021 % Chg. Revenue $3,836 $2,800 37% HPMC Segment Aerospace ramp driving continued strength HPMC Segment $1,641 $1,155 42% • Revenue: 42% top line growth driven by recovering narrowbody build rates. Jet Engine revenues increased 103% and Ai
Slide 8: Cash & Liquidity
Cash & Liquidity Net Debt/Adj. EBITDA Ratio: 2.2x (1) (2) Balance Sheet and Cash Flow Q4 Results • Liquidity of ~$1.1B, including $584M of cash on hand (2) $600 • Managed working capital 30% of sales ; improvement of 600+ basis points versus Q3 2022 levels $500 • Capital expenditures were $30M in Q4
Slide 9: First Quarter & Full Year 2023 Outlook
First Quarter & Full Year 2023 Outlook First Quarter 2023 Key Assumptions Earnings Drivers Adj. EPS1 • “Double-digit” growth in A&D, as well as specialty energy • Expanding titanium production up to 35% from existing assets $0.45 – $0.51 • Headwinds in industrial end markets will have modest impact
Slide 10: Additional Materials Appendix
Additional Materials Appendix
Slide 11: Non-GAAP financial measures
All (Unaudited, dollars in millions, except per share amounts) The Company reports its financial results in accordance with accounting principles generally accepted in the United States of America (“GAAP”). However, management believes that certain non-GAAP financial measures, used in managing the b
Slide 12: Net income per common share reconciliation
Three Months Ended September 30, 2022 December 31, 2021 Reported Adjusted Reported Adjusted Numerator for Basic net income (loss) per common share - Net income (loss) attributable to ATI $ 61.1 $ 77.4 $ (29.8) $ 33.6 Effect of dilutive securities 2.8 2.8 - 4.0 Numerator for Diluted net income (loss)
Slide 13: EBITDA and Adjusted EBITDA reconciliation
Three Months Ended Fiscal Year Ended December 31, 2022 September 30, 2022 December 31, 2021 December 31, 2022 December 31, 2021 December 31, 2019 Net income (loss) attributable to ATI $ 76.9 $ 61.1 $ (29.8) $ 130.9 $ (38.2) $ 252.5 Net income attributable to noncontrolling interests 4.3 3.3 5.2 15.6
Slide 14: Footnotes to reconciliation
All (a) Full year 2021 results include $63.2 million of pre-tax strike related costs, primarily consisting of overhead costs recognized in the period due to below-normal operating rates, higher costs for outside conversion activities, and ongoing benefit costs for striking employees. (b) Fourth quar
Slide 15: Free Cash Flow and Managed Working Capital
All Free Cash Flow Free cash flow as defined by ATI includes the total of cash provided by (used in) operating activities and investing activities as presented on the consolidated statements of cash flows, adjusted to exclude cash contributions to the Company's U.S. qualified defined benefit pension