ATI(ATI) - 2025 Q4 - Annual Results

Financial Performance - Annual sales for fiscal year 2025 reached $4.6 billion, the highest total since 2012[2] - Q4 2025 sales amounted to $1.2 billion, with net income attributable to ATI of $97 million, or $0.69 per share[5] - Fiscal year 2025 adjusted net income attributable to ATI was $460.1 million, a 30% increase compared to fiscal year 2024[17] - Adjusted earnings per share for fiscal year 2025 increased by 32% to $3.24 compared to $2.46 in fiscal year 2024[17] - Net income for the fiscal year ended December 28, 2025, increased to $418.6 million, up from $382.7 million in the previous year, representing a growth of 9.8%[26] - Net income attributable to ATI for the fiscal year ended December 28, 2025, was $404.3 million, an increase from $367.8 million in the previous year, resulting in EPS of $2.85 compared to $2.55[33] - Total revenue for the fiscal year ended December 28, 2025, reached $4,587.4 million, a 5.2% increase from $4,362.1 million in the previous year[27] Segment Performance - Sales to the aerospace & defense market represented 68% of Q4 2025 sales, an increase from 65% in Q4 2024[5] - HPMC segment sales in Q4 2025 were $645.9 million, with segment EBITDA of $155 million, or 24.0% of sales[11] - AA&S segment sales in Q4 2025 were $531.2 million, with segment EBITDA of $98.5 million, or 18.5% of sales[12] - Aerospace & Defense segment revenue accounted for 68% of total revenue, with a total of $3,111.5 million, up from $2,720.9 million, reflecting a growth of 14.4%[27] Cash Flow and Investments - Fiscal year 2025 operating cash flow was $614 million, up from $407 million in fiscal year 2024, representing a year-over-year increase of over 50%[10] - Cash provided by operating activities rose to $614.3 million, compared to $407.2 million in the prior year, marking a significant increase of 50.8%[26] - Cash used in investing activities was $234.5 million, an increase from $159.6 million in the prior year, reflecting the company's ongoing investment in property, plant, and equipment[26] - The company paid $470.0 million for treasury stock during the fiscal year, compared to $260.0 million in the previous year, indicating a significant increase in share repurchase activity[26] Balance Sheet and Assets - Total current assets decreased to $2,680.0 million from $2,945.0 million year-over-year, primarily due to a reduction in cash and cash equivalents[25] - Total liabilities decreased slightly to $3,182.9 million from $3,275.4 million year-over-year, with long-term debt remaining stable at $1,718.3 million[25] - The total cash and cash equivalents at the end of the period decreased to $416.7 million from $721.2 million, a decline of 42.2%[26] - The company experienced a net loss on sales of businesses of $2.9 million for the fiscal year, a significant improvement from a net loss of $52.9 million in the previous year[26] Operational Highlights - Q4 2025 adjusted EBITDA was $232 million, or 19.7% of sales, compared to $209.8 million, or 11% increase year-over-year[7] - Gross profit for the same quarter was $273.4 million, compared to $255.3 million in the prior quarter, reflecting a gross margin improvement[22] - Managed working capital as a percentage of annualized sales decreased to 32.5% for the quarter ended December 28, 2025, from 36.4% in the previous quarter[42] - The company reported a basic net income per common share of $2.92 for the fiscal year ended December 28, 2025, compared to $2.82 in the previous year, indicating a growth of 3.5%[28] Future Outlook - The company anticipates continued growth in sales driven by demand in aerospace and defense markets, despite potential economic uncertainties[19] - ATI's commitment to innovation and strategic partnerships is expected to enhance its product offerings and market position in the coming years[20] - The company reported a significant increase in inventory levels to $1,403.2 million, up from $1,353.0 million, indicating a proactive approach to meet future demand[25] Adjustments and Charges - Total pre-tax adjustments for special items in fiscal year 2025 amounted to $70.3 million, compared to a negative adjustment of $16.7 million in fiscal year 2024[33] - The company reported a restructuring and other charges of $48.8 million for fiscal year 2025, significantly higher than $22.1 million in fiscal year 2024[34] - The company experienced a pension remeasurement loss of $18.6 million in fiscal year 2025, compared to a loss of $14.1 million in fiscal year 2024[35]