
Total Forged Products sales of USD 771.5 million in the third quarter of fiscal 2012 exceeded last year's sales of USD 708.5 million by 9%. Contractual material pass through pricing and selling prices of external alloys sales from the segment's three primary mills increased year over year, adding approximately USD 45 million to Forged Products' third quarter sales. Sequentially, however, these prices reduced sales by approximately USD 5 million. Like Investment Cast Products, this segment saw a step up in the base commercial aircraft build rates in the first half of fiscal 2012, generating a 16% increase in aerospace sales over the third quarter of fiscal 201l, with solid incremental margins; however, sequential base aerospace sales were flat. Forged Products' 787 component production was flat sequentially, as anticipated, but, similar to the casting business, this segment expects modest schedule increases in the first quarter of fiscal 2013 to support the next increment in Boeing 787 production. In the power operations, total oil & gas sales were up more than 50% from the same quarter last year. Delivery of the segment’s Saudi Aramco nickel casing order is scheduled to begin late in the fourth quarter of fiscal 2012 and continue into the third quarter of fiscal 2013, and a nickel casing order in excess of USD 100 million with a second major customer will start shipping by late spring, with final deliveries expected in early calendar 2013. The growth in the oil & gas market helped to offset a year over year decrease in interconnect pipe sales, primarily driven by USD 20 million more of buy and resell product from Chengde in the third quarter of fiscal 2011. As of the fourth quarter of fiscal 2011, most product is now shipped directly from Chengde to end customers. The segment’s operating income showed a 22% YoY increase, growing to USD 172.6 million or 22.4% of sales for the quarter, versus USD 141.8 million or 20.0% of sales, in the third quarter of fiscal 2011.










