Q4 2025 Carpenter Technology Corp Earnings Call Transcript
Key Points
- Carpenter Technology Corp (CRS) achieved a record quarterly operating income of $151 million, marking a 21% increase over the previous year.
- The SAO segment reached a record operating income of $167 million, with operating margins expanding to 30.5%.
- The company generated $201.3 million in adjusted free cash flow during the quarter, demonstrating strong cash generation capabilities.
- Sales increased sequentially across all key end-use markets, with notable growth in the Aerospace and Defense, Medical, and Energy sectors.
- Carpenter Technology Corp (CRS) completed several long-term agreements at the Paris Air Show, supporting ongoing growth in the Aerospace and Defense market.
- Sales excluding surcharge decreased 2% year-over-year due to a 14% decline in volumes.
- The Medical end-use market saw a 16% decline in sales compared to the previous year's record fourth quarter.
- The PEP segment's net sales were down 5% from the same quarter a year ago, indicating challenges in this segment.
- The company anticipates planned maintenance activities in the upcoming quarter, which may impact operating income.
- There are concerns about inventory levels in the aerospace supply chain, particularly related to Boeing's 737 production.
Thank you for standing by. My name is Ian, and I will be your conference operator today. At this time, I would like to welcome everyone to the Carpenter Technology CRS Q4 FY25 earnings conference call. (Operator Instructions)
I would like to hand the call over to John Huyette, VP, Investor Relations. You may begin your conference.
Thank you, operator. Good morning, everyone, and welcome to the Carpenter Technology earnings conference call for the fiscal 2025 fourth quarter ended June 30, 2025. This call is also being broadcast over the internet along with presentation slides. For those of you listening by phone, you may experience a time delay in slide movement. Speakers on the call today are Tony Thene, President and Chief Executive Officer; and Tim Lain, Senior Vice President and Chief Financial Officer.
Statements made by management during this earnings presentation that are forward-looking statements are based on current expectations. Risk factors that could
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