Slide 1: Proven to perform anywhere. Third Quarter 2023 Earnings
Proven to perform anywhere. Third Quarter 2023 Earnings November 2, 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 driving continued results Deploying capital for shareholder Unlocking additional 10% capacity returns, balance sheet from existing asset base A&D increased to 61% of sales in Q3, up strengthening from 58% in Q2’23 and 51% in Q3’22
Slide 4: Strategic Markets & Diversified Applications
Strategic Markets & Diversified Applications Near-term Q3 ‘23 vs. vs. Market Market Comments Revenue Q3 ‘22 Q2 ‘23 Outlook • Growth trend expected to continue, supported by narrowbody and widebody production rate Jet Engine $329M +5% (3)% increases and continued strong aftermarket demand • Ongoing o
Slide 5: Third Quarter 2023 Financial Results
Third Quarter 2023 Financial Results $M (excl. EPS) Q3 2023 Q3 2022 % Chg. Q2 2023 % Chg. HPMC Segment • Revenue: Sequential and YoY revenue growth driven by: Revenue $1,026 $1,032 (1)% $1,046 (2)% ‒ Increased titanium shipments supporting ramping commercial airframe growth HPMC Segment $540 $458 +1
Slide 6: Cash & Liquidity
Cash & Liquidity Balance Sheet and Cash Flow (1) (2) Net Debt/Adj. EBITDA Ratio: 3.1x Q3 results • Liquidity of ~$990M, including $433M of cash on hand • Managed working capital(2) increased to 39.9% of sales due to: ‒ Inventory from increasing production levels and ramping melt capacity ‒ Anticipat
Slide 7: Fourth Quarter & Full Year 2023 Outlook
Fourth Quarter & Full Year 2023 Outlook Fourth Quarter 2023 Full Year Adj. EPS1 Adj. EPS1 FCF2 $0.57 – $0.67 $2.20 - $2.30 $130 – $160 million (Previously $2.15 - $2.35) (Previously $125 - $175 million) $0.70 2023 Adj. EPS by Quarter Key Assumptions $0.60 Key Drivers $0.50 ✓ Continued growth in A&D,
Slide 8: Additional Materials Appendix
Additional Materials Appendix
Slide 9: Appendix 1 – 2023 Outlook Assumptions
Appendix 1 – 2023 Outlook Assumptions Earnings Drivers 2023 FY Net Interest Expense ~$94M Annual Cash Flow Drivers Capital Expenditures $190M - $210M Managed Working Capital(2) Cash Usage of ~$105M Full Year Cash Taxes ~$19M Remaining Share Repurchase Authorization ~$30M(3) (1) Assumes valuation all
Slide 10: Appendix 2 – Non-GAAP Financial Measures
Appendix 2 ATI Inc. and Subsidiaries Non-GAAP Financial Measures (Unaudited, dollars in millions, except per share amounts) The Company Companyreports reportsitsits financial financialresults in accordance results in accordance with accounting principles with accounting generally principles accepted
Slide 11: Appendix 2 (continued)
Appendix 2 (continued) Three Months Ended September 30, 2023 June 30, 2023 September 30, 2022 Reported Adjusted Reported Adjusted Reported Adjusted Numerator for Basic net income per common share - Net income attributable to ATI $ 75.7 $ 79.7 $ 76.0 $ 86.2 $ 61.1 $ 77.4 Effect of dilutive securities
Slide 12: Appendix 2 (continued)
Appendix 2 (continued) Latest Twelve Months Three Months Ended Ended September 30, 2023 June 30, 2023 September 30, 2022 September 30, 2023 Net income attributable to ATI $ 75.7 $ 76.0 $ 61.1 $ 298.7 Net income attributable to noncontrolling interests 3.9 3.1 3.3 13.4 Net income 79.6 79.1 64.4 312.1
Slide 13: Appendix 2 (continued) – Free Cash Flow
Appendix 2 (continued) 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 defi