Carpenter Technology Corp. Files Q2 2025 10-Q

TL;DR

CRS Q2 2025 10-Q filed. Check financials.

AI Summary

Carpenter Technology Corp. reported its Q2 2025 results for the period ending December 31, 2024. The company's fiscal year ends on June 30th. This filing covers the second quarter of their fiscal year.

Why It Matters

This filing provides investors with the latest financial performance and operational details for Carpenter Technology Corp., crucial for understanding the company's current standing and future prospects.

Risk Assessment

Risk Level: low — This is a standard quarterly financial filing with no immediate red flags.

Key Players & Entities

• CARPENTER TECHNOLOGY CORP (company) — Filer
• 0000017843 (company) — Central Index Key
• 20241231 (date) — Period of Report
• 20250130 (date) — Filed as of Date

FAQ

Key Financial Figures

• $5 — ction 12(b) of the Act: Common Stock, $5 Par Value CRS New York Stock Exchange

Filing Documents

• crs-20241231.htm (10-Q) — 1878KB
• crs-ex31ax20241231.htm (EX-31.A) — 11KB
• crs-ex31bx20241231.htm (EX-31.B) — 11KB
• crs-ex32x20241231.htm (EX-32) — 7KB
• 0000017843-25-000003.txt ( ) — 8709KB
• crs-20241231.xsd (EX-101.SCH) — 38KB
• crs-20241231_cal.xml (EX-101.CAL) — 67KB
• crs-20241231_def.xml (EX-101.DEF) — 163KB
• crs-20241231_lab.xml (EX-101.LAB) — 549KB
• crs-20241231_pre.xml (EX-101.PRE) — 383KB
• crs-20241231_htm.xml (XML) — 1768KB

Financial Statements

Financial Statements Consolidated Balance Sheets (unaudited) as of December 3 1 , 202 4 and June 30, 2024 2 Consolidated Statements of Operations (unaudited) for the Three and Six Months Ended December 3 1 , 2024 and 2023 3 Consolidated Statements of Comprehensive Income (unaudited) for the Three and Six Months Ended December 3 1 , 2024 and 2023 4 Consolidated Statements of Cash Flows (unaudited) for the Six Months Ended December 3 1 , 2024 and 2023 5 Consolidated Statements of Changes in Equity (unaudited) for the Three and Six Months Ended December 3 1 , 2024 and 2023 6

Notes to Consolidated Financial Statements (unaudited)

Notes to Consolidated Financial Statements (unaudited) 8 Item 2

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 27 Item 3

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 50 Item 4

Controls and Procedures

Controls and Procedures 51 PART II OTHER INFORMATION Item 1

Legal Proceedings

Legal Proceedings 51 Item 1A

Risk Factors

Risk Factors 51 Item 2 Unregistered Sales of Equity Securities and Use of Proceeds 51 Item 5 Other Information 52 Item 6 Exhibits 52 SIGNATURE 53 1 Table of Contents

- FINANCIAL INFORMATION

PART I - FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements CARPENTER TECHNOLOGY CORPORATION CONSOLIDATED BALANCE SHEETS (Unaudited) (in millions, except share data) December 31, 2024 June 30, 2024 ASSETS Current assets: Cash and cash equivalents $ 162.1 $ 199.1 Accounts receivable, net 565.4 562.6 Inventories 812.0 735.4 Other current assets 100.8 94.1 Total current assets 1,640.3 1,591.2 Property, plant, equipment and software, net 1,325.2 1,335.2 Goodwill 227.3 227.3 Other intangibles, net 12.4 15.2 Deferred income taxes 7.6 7.5 Other assets 113.9 115.3 Total assets $ 3,326.7 $ 3,291.7 LIABILITIES Current liabilities: Accounts payable $ 266.9 $ 263.9 Accrued liabilities 165.2 202.4 Total current liabilities 432.1 466.3 Long-term debt 694.8 694.2 Accrued pension liabilities 198.9 207.6 Accrued postretirement benefits 22.1 21.1 Deferred income taxes 166.7 174.1 Other liabilities 95.2 99.6 Total liabilities 1,609.8 1,662.9 Contingencies and commitments (see Note 10) STOCKHOLDERS' EQUITY Common stock — authorized 100,000,000 shares; issued 57,111,839 shares at December 31, 2024 and 56,978,663 shares at June 30, 2024; outstanding 49,875,113 shares at December 31, 2024 and 49,776,955 shares at June 30, 2024 285.6 284.9 Capital in excess of par value 338.0 352.6 Reinvested earnings 1,523.2 1,374.5 Common stock in treasury ( 7,236,726 shares and 7,201,708 shares at December 31, 2024 and June 30, 2024, respectively), at cost ( 333.7 ) ( 289.3 ) Accumulated other comprehensive loss ( 96.2 ) ( 93.9 ) Total stockholders' equity 1,716.9 1,628.8 Total liabilities and stockholders' equity $ 3,326.7 $ 3,291.7 See accompanying notes to consolidated financial statements. 2 Table of Contents CARPENTER TECHNOLOGY CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) Three Months Ended December 31, Six Months Ended December 31, (in millions, except per share data) 2024 2023 2024 2023 Net sales $ 676.9 $ 624.2 $ 1,394.5 $ 1,276.1 Cost of sales 499.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 1. Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments, consisting of normal and recurring adjustments, considered necessary for a fair statement of the results are reflected in the interim periods presented. The June 30, 2024, consolidated balance sheet data was derived from audited financial statements, but does not include all of the disclosures required by U.S. GAAP. These unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements and footnotes thereto included in Carpenter Technology's Annual Report on Form 10-K for the fiscal year ended June 30, 2024 (the "2024 Form 10-K"). Operating results for the three and six months ended December 31, 2024, are not necessarily indicative of the operating results for any future period. As used throughout this report, unless the context requires otherwise, the terms "Carpenter," "Carpenter Technology," the "Company," "Registrant," "Issuer," "we" and "our" refer to Carpenter Technology Corporation. 2. Restructuring and Asset Impairment Charges Restructuring and asset impairment charges for the three and six months ended December 31, 2024 were $ 0.0 million and $ 3.6 million, respectively, compared to no restructuring and asset impairment charges for the three and six months ended December 31, 2023. During the six months ended December 31, 2024, the Company recorded additional restructuring and asset impairment charges of $ 3.6 million as a result of the prior year actions taken t

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 3. Recent Accounting Pronouncements Recently Issued Accounting Pronouncements - Pending Adoption In November 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-07 Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The guidance in ASU 2023-07 seeks to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The amendments in this ASU require a public entity to disclose the following: significant segment expenses that are regularly provided to the chief operating decision maker ("CODM") and included within each reported measure of segment profit or loss; an amount for other segment items by reportable segment and a description of its composition; and the title and position of the CODM and how the CODM uses the reported measure(s) of segment profit or loss in assessing segment performance and deciding how to allocate resources. This ASU requires public entities to provide all annual disclosures about a reportable segment's profit or loss and assets currently required by Topic 280 in interim periods. ASU 2023-07 clarifies that if the CODM uses more than one measure of a segment's profit or loss in assessing segment performance and deciding how to allocate resources, a public entity may report one or more of those additional measures of segment profit. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. ASU 2023-07 is a requirement for additional disclosure and is not expected to materially impact the consolidated financial statements. In December 2023, the FASB issued ASU 2023-09 Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The guidance in this ASU enhances the transparency and decision functionality of income t

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) The Company recognizes revenue when performance obligations under the terms of a customer purchase order or contract are satisfied. This occurs when control of the goods and services has transferred to the customer, which is generally determined when title, ownership and risk of loss pass to the customer, all of which occurs upon shipment or delivery of the product or the service is performed. Consignment transactions are arrangements where the Company transfers product to a customer location but retains ownership and control of such product until it is used by the customer. Revenue for consignment arrangements is recognized upon usage by the customer. Service revenue is recognized as the services are performed. The Company's standard customer purchase order or contract for goods transferred has a single performance obligation for which revenue is recognized at a point in time. The standard terms and conditions of a customer purchase order include general rights of return and product warranty provisions related to nonconforming product. Depending on the circumstances, the product is either replaced or a quality adjustment is issued. Such warranties do not represent a separate performance obligation. The Company's standard purchase order or contract sets forth the transaction price for the products and services purchased under that arrangement. Some customer arrangements include variable consideration, such as volume rebates, which generally depend upon the Company's customers meeting specified performance criteria, such as a purchasing level over a period of time. The Company exercises judgment to estimate the most likely amount of variable consideration at each reporting date. Revenue is measured as the amount of consideration the Company expects to receive in exchange for its product. The normal payment terms are 30 days. The Company has elected to use the practical expedient that permits a company to

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Disaggregation of Revenue The Company operates in two business segments, Specialty Alloys Operations ("SAO") and Performance Engineered Products ("PEP"). Revenue is disaggregated within these two business segments by diversified end-use markets and by geographical locations. Comparative information of the Company's overall revenues by end-use markets and geographic locations for the three and six months ended December 31, 2024 and 2023 were as follows: End-Use Market Three Months Ended December 31, 2024 Three Months Ended December 31, 2023 ($ in millions) SAO PEP Intersegment Total SAO PEP Intersegment Total Aerospace and Defense $ 393.0 $ 24.2 $ ( 3.8 ) $ 413.4 $ 302.1 $ 25.7 $ ( 6.8 ) $ 321.0 Medical 57.6 42.0 ( 13.3 ) 86.3 65.5 32.4 ( 10.2 ) 87.7 Energy 41.6 1.9 — 43.5 48.4 3.7 — 52.1 Transportation 26.9 1.8 ( 0.2 ) 28.5 34.9 2.3 — 37.2 Industrial and Consumer 82.4 5.1 ( 2.3 ) 85.2 98.5 9.6 ( 3.8 ) 104.3 Distribution — 20.0 — 20.0 — 22.0 ( 0.1 ) 21.9 Total net sales $ 601.5 $ 95.0 $ ( 19.6 ) $ 676.9 $ 549.4 $ 95.7 $ ( 20.9 ) $ 624.2 Geographic Location Three Months Ended December 31, 2024 Three Months Ended December 31, 2023 ($ in millions) SAO PEP Intersegment Total SAO PEP Intersegment Total United States $ 367.0 $ 57.7 $ ( 5.5 ) $ 419.2 $ 326.3 $ 53.9 $ ( 6.2 ) $ 374.0 Europe 93.4 16.1 ( 4.2 ) 105.3 91.9 18.6 ( 4.0 ) 106.5 Asia Pacific 80.7 10.5 ( 9.9 ) 81.3 82.3 11.5 ( 10.8 ) 83.0 Mexico 36.0 6.5 — 42.5 26.4 8.3 ( 0.1 ) 34.6 Canada 12.4 2.1 — 14.5 11.7 2.4 — 14.1 Other 12.0 2.1 — 14.1 10.8 1.0 0.2 12.0 Total net sales $ 601.5 $ 95.0 $ ( 19.6 ) $ 676.9 $ 549.4 $ 95.7 $ ( 20.9 ) $ 624.2 11 Table of Contents CARPENTER TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) End-Use Market Six Months Ended December 31, 2024 Six Months Ended December 31, 2023 ($ in millions) SAO PEP Intersegment Total SAO PEP Intersegment Total Aerospace and Defense $ 810.9 $ 48.3 $ ( 8.4 ) $ 850.8 $ 634.1 $ 50.9 $ ( 11.5 ) $ 673.5 Medical 118.8 83.8 ( 29.4 ) 173.2 120.9 68.1 ( 21.4 ) 167.6 Energy 93.2 2.8 — 96.0 91.5 5.2 0.1 96.8 Transportation 53.2 3.7 ( 0.1 ) 56.8 75.0 4.2 — 79.2 Industrial and Consumer 170.5 15.9 ( 10.0 ) 176.4 197.9 19.3 ( 7.8 ) 209.4 Distribution — 41.3 — 41.3 — 49.7 ( 0.1 ) 49.6 Total net sales $ 1,246.6 $ 195.8 $ ( 47.9 ) $ 1,394.5 $ 1,119.4 $ 197.4 $ ( 40.7 ) $ 1,276.1 Geographic Location Six Months Ended December 31, 2024 Six Months Ended December 31, 2023 ($ in millions) SAO PEP Intersegment Total SAO PEP Intersegment Total United States $ 740.7 $ 116.0 $ ( 16.4 ) $ 840.3 $ 666.8 $ 112.0 $ ( 11.4 ) $ 767.4 Europe 223.2 32.4 ( 9.9 ) 245.7 186.8 35.4 ( 8.3 ) 213.9 Asia Pacific 175.1 22.2 ( 21.6 ) 175.7 185.0 21.9 ( 20.8 ) 186.1 Mexico 65.1 14.4 ( 0.1 ) 79.4 40.8 18.0 — 58.8 Canada 22.9 5.9 0.1 28.9 20.9 6.9 — 27.8 Other 19.6 4.9 — 24.5 19.1 3.2 ( 0.2 ) 22.1 Total net sales $ 1,246.6 $ 195.8 $ ( 47.9 ) $ 1,394.5 $ 1,119.4 $ 197.4 $ ( 40.7 ) $ 1,276.1 12 Table of Contents CARPENTER TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 5. Earnings per Common Share The Company calculates basic and diluted earnings per share using the two class method. Under the two class method, earnings are allocated to common stock and participating securities (non-vested restricted shares and units that receive non-forfeitable dividends) according to their participation rights in dividends and undistributed earnings. The earnings available to each class of stock are divided by the weighted average number of outstanding shares for the period in each class. Diluted earnings per share assumes the issuance of common stock for all potentially dilutive share equivalents outstanding. No awards issued under share-based compensation plans were excluded from the calculations of diluted earnings per share because their effects were anti-dilutive for the three and six months ended December 31, 2024 and 2023. The calculations of basic and diluted earnings per common share for the three and six months ended December 31, 2024 and 2023 were as follows: Three Months Ended December 31, Six Months Ended December 31, (in millions, except per share data) 2024 2023 2024 2023 Net income $ 84.1 $ 42.7 $ 168.9 $ 86.6 Dividends allocated to participating securities ( 0.1 ) ( 0.1 ) ( 0.1 ) ( 0.1 ) Earnings available for common stockholders used in calculation of basic earnings per common share $ 84.0 $ 42.6 $ 168.8 $ 86.5 Weighted average number of common shares outstanding, basic 50.2 49.7 50.2 49.4 Basic earnings per common share $ 1.68 $ 0.86 $ 3.37 $ 1.75 Net income $ 84.1 $ 42.7 $ 168.9 $ 86.6 Dividends allocated to participating securities ( 0.1 ) ( 0.1 ) ( 0.1 ) ( 0.1 ) Earnings available for common stockholders used in calculation of diluted earnings per common share $

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