Allegheny Technologies Inc. (ATI) 2011年年度報告「NYSE」.pdf

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1、Corporate Headquarters1000 Six PPG PlacePittsburgh,PA 15222-5479U.S.A.412-394-2800ATI 2012 ATIATI ANNUAL REPORT 2011ATI ANNUAL REPORT 2011 23INvESTOR INfORmATIONCorporate Headquarters1000 Six PPG PlacePittsburgh,PA 15222-5479412-394-2800Annual MeetingThe Annual meeting of Stockholders will be held o

2、n may 11,2012 at 11:00 a.m.Grand Ballroom,17th floorOmni William Penn Hotel 530 William Penn Place,Pittsburgh,PA 15219Transfer Agent and RegistrarComputershare(formerly BNY mellon)P.O.Box 358015Pittsburgh,PA 15252-8015or480 Washington BoulevardJersey City,NJ 07310-19001-800-406-4850 about dividend c

3、hecks,dividend tax information,and stock certificates,including lost or unexchanged certificates)Investor Services ProgramComputershare(formerly BNY mellon)offers an Investor Services Program for current stockholders and interested investors which includes:VoluntarypurchasesofAlleghenyTechnologiesco

4、mmon stock for new investors and current stockholders Dividendreinvestment Directdepositofdividendsintoyourpersonalchecking,savings or other account SafekeepingofstockcertificatesatnochargeTo request Program information and enrollment forms,call:1-866-353-7849To ask about the Program or your Program

5、 account,contact:Computershare(formerly BNY mellon)P.O.Box 358035 Pittsburgh,PA 15252-8035 1-800-406-4850Stockholder PublicationsAnnual reports and proxy statements are mailed to all stockholders of record.These publications and Reports on form 10-K and form 10-Q and other information may also be ob

6、tained through the Companyswebsitewww.ATI.for additional information contact:Investor Relations and Corporate Communications at corporate headquarters,or by calling 412-394-3004.Independent AuditorsErnst&Young LLPPittsburgh,PAForm 10-KThe Company submits an annual report to the Securities andExchang

7、e Commission(SEC)on form 10-K.Copies of the form 10-K are available upon written request to the CorporateSecretary at the corporate headquarters.Stock Exchange ListingThe common stock of Allegheny Technologies Incorporatedis traded on the New York Stock Exchange(symbol ATI).OptionsontheCompanysstock

8、aretradedontheAmericanStock Exchange,the Chicago Board of Options Exchange,the Pacific Exchange,and on the Philadelphia Stock Exchange.Internet Home PageAlleghenyTechnologiesInternethomepagecanbefoundat www.ATI.Please visit our website for more information on the Company,our products and operations.

9、On this site you can find our news releases and SEC filings,and obtain instructions on how to transfer ownership of your stock,sign-up for the Investor Services Program,directly deposit your dividend check,change your dividend payment information and locate tax reporting information.fINANCIAL REvIEW

10、 1mESSAGE fROm THE CHAIRmAN,PRESIDENTAND CHIEf EXECUTIvE OffICER 3INTEGRATEDAEROSPACESUPPLYCHAIN8AEROSPACE ENGINES 10INTEGRATEDOIL&GASSUPPLYCHAIN12WHATWEMAKEANDWHEREITGOES14ATIPRODUCTSANDMARKETS16SEGmENT INfORmATION 17GLOSSARY Of TERmS 18CORPORATE SELf-GOvERNANCE 20ANNUAL REPORT ON fORm 10-K f1mANAG

11、EmENT TEAm 21BOARDOFDIRECTORS22INvESTOR INfORmATION 23ATI ANNUAL REPORT 2011CONTENTSCONTENTSAbout the CoverATI Pacific Cast Technologies Brian Lucero conducts an ultrasonic and visual inspection of a large titanium investment casting destined for an aerospace engine.FINANCIAL REVIEWTop left:Senior P

12、lasma Melter Lonnie Bowman looks through a viewport and instructs plasma control room operators on plasma torch position settings during the start-up of the PAM-4 furnace at ATIs Bakers,NC melting operations.Bottom left:Investment casting begins in the wax assembly room at ATI Pacific Cast Tech-nolo

13、gies.ATI Wax Assembler Mary E.Copeland joins several separate wax components to create a complete wax model.These wax models embody the effective combination of part design,die design,and molten metal solidification modeling.Below left:Sam Menzie,Operator Leader,in the ESR furnaces control room at A

14、TIs Latrobe,PA operations.Below right:X-ray analysis is one of several techniques employed by ATI Pacific Cast Technologies to assure the surface,internal integrity and dimensional excellence of its products.ATI Technician Clayton Roth Jr.adds a visual inspection to his analysis of an X-rayed near-n

15、et-shape titanium cast component.(1)Before the effects of inflation.(2)Represents accounts receivable and gross inventory less accounts payable,excluding LIFO inventory reserves and other allowances.Sales annualized for last two months of the period.(3)Represents total debt less cash and cash equiva

16、lents.(4)Total capitalization is comprised of net debt plus total ATI stockholders equity.2011 2010 2009 2008 2007 Sales$5.2 billion$4.0 billion$3.1 billion$5.3 billion$5.5 billion Segment Operating Profit$612.0 million$356.5 million$282.2 million$944.9 million$1,273.2 million Net Income Attributabl

17、e to ATI$214.3 million$70.7 million$31.7 million$565.9 million$747.1 million Net Income per Common Share$1.97$0.72$0.32$5.67$7.26 Gross Cost Reductions(1)$124 million$135 million$173 million$134 million$112 million Managed Working Capital as%of Annualized Sales(2)37.8%34.4%34.5%35.2%32.2%Net Debt(3)

18、$1,128.7 million$631.0 million$362.3 million$39.9 million$(95.1)million Net Debt as%of Total Capitalization(4)31.3%23.6%15.3%2.0%(4.5)%Capital Investments and Asset Acquisitions$1,175.8 million$219.1 million$454.3 million$515.7 million$457.1 millionATI ANNUAL REPORT 2011 12 ATI ANNUAL REPORT 2011FIN

19、ANCIAL REVIEWSalesBillions$5.5$1.9$1.9$2.7$3.5$4.9$0$1$2$3$4$5$6$5.3$3.12002 2003 2004 2005 2006 2007 2008 2009 2010 2011Segment Operating ProfitMillions$1,273$174$542$1,070$0$250$500$750$1000$1250$945$2822002 2003 2004 2005 2006 2007 2008 2009 2010 2011$23$27ATI Stockholders Equityat End of YearMil

20、lions$2,222$431$808$1,503$0$500$1000$1500$2000$2500$1,957$2,012$2,0412002 2003 2004 2005 2006 2007 2008 2009 2010 2011$179$453Net Income(Loss)Attributable to ATIMillions$747$21$362$574$0$200$400$600$566$322002 2003 2004 2005 2006 2007 2008 2009 2010 2011$(314)$(66)Cash and Cash Equivalentsat End of

21、YearMillions$623$251$363$502$0$200$400$600$800$470$709$432$712002 2003 2004 2005 2006 2007 2008 2009 2010 2011$80$59Earnings Per Share$7.26$0.24$3.59$5.61$0$2$4$6$8$5.67$0.322002 2003 2004 2005 2006 2007 2008 2009 2010 2011$(3.89)$(0.82)$0.72$4.0$357$5.2$612$1.97$214$2,475$381ATI ANNUAL REPORT 2011

22、3MESSAGE FROM THE CHAIRMAN,PRESIdENT ANd CHIEF EXECUTIVE OFFICER2011 was a much better year for ATI.As we entered 2011,it was our view that the year would be marked by the resumption of secular growth in our key global markets.This was realized in spite of the choppy recovery in the U.S.economy and

23、the mostly unanticipated impact from euro-zone sovereign debt issues.Our focus on product and market diversification and a higher-value product mix,both of which are key parts of ATIs strategy,enabled ATI to achieve profitable growth in spite of a sluggish recovery in some of our short-cycle markets

24、,particularly during the second half of 2011.Revenues grew 28%over 2010 to nearly$5.2 billion.Growth in our key markets combined with the May 2011 Ladish acquisition more than offset reduced demand and historically low base prices for our standard stainless products.Our key global markets,namely aer

25、ospace and defense,oil&gas/chemical process industry,electrical energy,and medical,represented 70%of ATI sales in 2011.Growth in these key markets continued to be strong and sales were 33%higher than in 2010.Sales to the aerospace and defense,oil&gas/chemical process industry,electrical energy,and m

26、edical markets grew 44%,41%,16%,and 8%,respectively.Segment operating profit,excluding inventory fair value accounting costs associated with the Ladish acquisition,was$639 million,or 12%of sales.Earnings per share,excluding special charges,was$2.23,which is 210%higher than 2010.Earnings per share in

27、cluding special charges was$1.97,nearly 175%higher than 2010.Our financial position remains solid with cash on hand of over$380 million at the end of 2011 and net debt to total capitalization of approximately 31%.Capital expenditures were$278 million in 2011,and we invested$273 million in managed wo

28、rking capital to support growth in our business.On May 9,2011,ATI completed the acquisition of Ladish Co.,Inc.for$897.6 million,comprised of the issuance of 7.3 million shares of ATI common stock and payment of$384 million in cash.ATI Ladish post-acquisition results are included in our High Performa

29、nce Metals segment.Our strategy takes a long-term view while maximizing near-term performance,meaning that we manage the Company to maximize the short-term opportunities without losing sight of our long-term profitable growth strategy.We are a profitable company with a strong balance sheet,which ena

30、bles ATI to continue our investments in new manufacturing capabilities,innovative new products,and global marketing initiatives.We believe in American manufacturing.We have approximately 11,400 full-time employees,86%of whom are located in the U.S.,who manufacture diversified specialty metals produc

31、ts for a diverse array of end-use markets including,aerospace and defense,oil and gas/chemical process industry,electrical energy generation and distribution,medical devices and equipment,automotive,food equipment and appliances,machine and cutting tools,and construction and mining equipment.We are

32、fortunate that,at this time,we are one of the few companies in the world who can produce the specialty metals that can stand up to such critical applications.We understand that the ability to manufacture these critical specialty metals is a core competency of the United States.To that end,since 2004

33、,we have invested over$3.3 billion in capital expenditures and asset acquisitions.ATI has self-funded approximately 75%of these investments with the cash flow generated by our businesses.We have created nearly 1,800 new jobs in just the last two years.Our direct international sales were 35%in 2011,a

34、nd we are proud that a U.S.manufacturer can achieve that level of international sales.We are also proud to support our domestic customers who make important products in the U.S.for domestic and global markets including such products as airplanes and jet engines,industrial gas turbines for electrical

35、 power generation,oil and gas equipment,and medical devices.2011 Major Accomplishments We understand that industry leadership and competitive advantage exist only for a period of time.Status quo loses.ATI is not the same company it was five years ago,and to be successful five years from now,ATI cann

36、ot be the same company that it is today.Our ability to manufacture industry-leading mill products,near-net shapes,and components made from Mission Critical Metallics,such as titanium and titanium alloys,nickel-based alloys and superalloys,specialty alloys,and zirconium alloys,for our key markets pos

37、itions ATI with a unique supply chain that provides value to our customers and creates value for our stockholders.We must continue to invest in unsurpassed manufacturing capabilities and innovative new products to maintain and enhance ATIs position as a global leader in specialty metals.Major accomp

38、lishments in 2011 that support our strategy include:The acquisition of ATI Ladish was completed and integration began immediately.With the forging,casting and machining capabilities of ATI Ladish,we are now integrated in titanium alloys,nickel-based alloys,and specialty alloys from raw materials(tit

39、anium sponge)through melting and forging of mill products and complex shapes,to forged and investment cast parts and components.Many of our OEM customers tell us that they value a seamless,real supply chain over a virtual supply chain with multiple producers involved.Being integrated from alloy deve

40、lopment and melt through the forging,casting and machining of the final part is now a strength of ATI.We have a growing reputation as the technology leader who can provide customers with the seamless product development and manufacturing capabilities they need now and in the future.With ATI Ladish,w

41、e add isothermal forging,hot-die forging,and large complex investment castings to our list of unsurpassed manufacturing capabilities.These are the processes required to make the advanced components for the next-generation and future-generation jet engines.We also add forging capabilities in Poland,i

42、n an area that is a fast-growing region of the global aerospace industry supply chain.Synergy teams are working on identified opportunities to bring more ATI specialty metals and cutting tools into ATI Ladish.We have a closed-loop raw material supply chain as Ladish revert material is recycled throu

43、gh ATI melting facilities.Creating Value for Our Customers and StockholdersIn 2011,Secular Growth Resumed in Our Key Markets4 ATI ANNUAL REPORT 2011MESSAGE FROM THE CHAIRMAN,PRESIdENT ANd CHIEF EXECUTIVE OFFICER A significant benefit from combining ATIs leading melting and hot working mill products

44、technologies and capabilities with ATI Ladish forging and casting capabilities is the real-time technology information exchange.We believe this transparent technology exchange can create better products,improve productivity,reduce costs,and compress the time of alloy and product development.Signific

45、ant progress was made throughout 2011 as we began production at our Rowley,UT premium-titanium sponge facility.We expect to complete the standard grade qualification process by the end of the first quarter 2012,and we will then proceed with the premium grade qualification process.Production began at

46、 our new Plasma Arc Melt(PAM)premium-titanium furnace located in Bakers,NC.This now gives ATI the capabilities of four PAM furnaces.Construction began at the L.Patrick Hassey Hot Rolling and Processing facility located in Brackenridge,PA.This project is expected to cost approximately$1.1 billion and

47、 is scheduled for completion by the end of 2013,with cold and hot commissioning scheduled for 2014.It is designed to be the most powerful mill in the world for manufacturing flat-rolled specialty metals.We expect expanded capabilities,improved productivity,lower costs,faster manufacturing cycle time

48、s,and higher quality for our diversified product mix of nickel-based alloys,titanium and titanium alloys,specialty alloys,zirconium alloys,and stainless steels.This investment creates significant profitable growth opportunities for all of ATIs flat-rolled products.In 2011,we improved our cost struct

49、ure with nearly$124 million in gross cost reductions.This brings our eight-year total to over$1.1 billion in gross cost reductions,before the effects of inflation.Improving our cost structure is part of ATIs DNA.We set cost reduction targets in each year of every business cycle.We understand that co

50、ntinuous improvement is a race without a finish line.Great companies,particularly a U.S.manufacturer doing business throughout the world,must not only keep costs under control,but must get better each year.ATI Managements Executive Committee(left to right):John Sims,Carl Moulton,Terry Dunlap,Hunter

51、Dalton,Rich Harshman,Gary Vroman,Elliot Davis,Dale Reid,Dave Hogan.ATI ANNUAL REPORT 2011 5MESSAGE FROM THE CHAIRMAN,PRESIdENT ANd CHIEF EXECUTIVE OFFICERdifferentiated Markets with GoodSecular Growth TrendsOur strategy is to identify secular growth trends in the global economy that have a meaningfu

52、l impact on the use of our products.Even as we see short-term economic cycles in the world,we continue to believe that the worlds population is growing and more people are moving into an expanded middle class.The commercial aerospace market is in an extended period of unprecedented demand for fuel-e

53、fficient airplanes,both to accommodate the worlds growing middle class and to provide replacement aircraft to legacy fleets.In addition,our products are vital to building the global infrastructure in such markets as oil and gas/chemical process industry,and electrical energy.demand for our products

54、from the medical market is being driven by the expansion of procedures for aging population demographics and the growing need for advanced medical equipment and care in developing economies.These secular growth markets are not solely dependent upon strong short-term GdP growth cycles in any one econ

55、omy as was evident by our 2011 results.Rather,the markets are responding to a long-term demographic shift and long-term infrastructure building and rebuilding occurring on a global basis.Strong demand for Fuel-Efficient AirplanesWe are well-positioned to support our customers in the expected biggest

56、 and longest aerospace cycle in history.The OEMs have historic backlogs.The need for fuel-efficient and cost-efficient airplanes and jet engines is expected to continue to drive demand for many years.In 2011,the transition to much higher build rates began at both Boeing and Airbus.Boeing delivered t

57、he first 787 dreamliner,the first 747-8 cargo plane,and sold more 777s than ever before.The Boeing 737Max and Airbus A320neo single aisle airplanes with future-generation engines were both successfully announced and significant orders were received.These new airplanes will use jet engines that requi

58、re even more advanced titanium alloys and nickel-based alloys to withstand the greater pressures and higher temperatures needed for the improved fuel efficiency demanded by global carriers.Orders placed in 2011 combined with the historic OEM backlogs are expected to create demand for our specialty m

59、etals and components for many years.First,we are seeing the increase in build rates for legacy airplanes such as the B737,A320,B777,and A330 to unprecedented levels.At the same time,we are seeing the ramp-up in production rates for the 787 dreamliner and the 747-8.The entry-into-service of the Airbu

60、s A350XWB is currently scheduled for 2014.In addition,the future-generation single aisle aircraft are in the design engineering stage.This is a great time to be considered a technology leader for the wide range of advanced specialty metals required by all of these airplanes and their jet engines.Str

61、ong demand for Oil and Gas,Chemicals,and Clean WaterMost forecasts indicate an extended period of investment to explore and recover oil and gas deposits around the world.development of large deep-water oil and gas fields is expected to continue for many years.We are seeing an historic shift taking p

62、lace oil and gas exploration and increased production is moving to OECd countries to reduce risk.New advanced technologies,such as horizontal and directional drilling,are helping to enable this shift by creating access to new oil and gas deposits.Horizontal drilling is gaining share of the global ri

63、g count as the development of shale oil and gas moves from the U.S.to many other areas of the world.The need for our products grows even faster as the search for energy moves to ultra-deep water,deep subsalt high-temperature high-pressure wells,severely sour oil and gas,and unconventional processes

64、requiring directional and horizontal drilling.In 2011,our ATI nickel-alloy plate and sheet was used for large sour gas field projects in Saudi Arabia,Abu dhabi,Australia,and Brazil.We received NORSOK(Norwegian petroleum industry standard)requalification for our family of duplex alloys(ATI 2003 lean

65、duplex,ATI 2205 duplex,and Zeron 100 superduplex),our super austenitic alloy AL-6XN alloy,and titanium castings.Robust demand continued from horizontal and directional drilling service for ATI datalloy 2 stainless and ATI tungsten materials for use in earth-boring bits.In addition,infrastructure dev

66、elopment is continuing to emerge for consumption of lower cost natural gas by petrochemical plants that use our alloys that withstand the corrosive and hot environments of these facilities.In 2011,we produced and delivered the largest industrial titanium sheet order in the history of ATI to be used

67、in the worlds largest seawater desalination plant.We expect the need for clean water to continue to grow and drive demand for many of our corrosion-resistant alloys.Growing demand for Safe,Clean andEfficient Electrical EnergyAccording to the International Energy Agency(IEA),the world faces enormous

68、energy challenges in the future.demand is expected to rise 35%over the next 25 years with investment in energy infrastructure to average approximately$1.5 trillion a year for decades.Competing energy sources,such as nuclear,coal,natural gas,and oil,are expected to comprise the primary base load powe

69、r generation.The largest market demand is predicted to be in China,India,South Korea,and a few countries in the Middle East.In the United States,energy growth is being impacted by the new economics of natural gas power generation.Renewables,such as solar,wind,and geothermal,are projected to gain the

70、 most share,but remain below 15%of total world power generation.ATIs Strategy is to Create Value Through Sustainable Profitable Growth Identify differentiated markets with good secular growth trends Focus on key global markets Invest in unsurpassed manufacturing capabilities develop and introduce in

71、novative products Continue to focus on lean manufacturing and cost reduction6 ATI ANNUAL REPORT 2011MESSAGE FROM THE CHAIRMAN,PRESIdENT ANd CHIEF EXECUTIVE OFFICERPublic reaction to the 2011 Fukushima nuclear power plant accident in Japan has slowed the renaissance for new nuclear power plants.The a

72、ccident has focused attention on nuclear power plant safety and design upgrades to existing reactors and has increased political pressure to find a solution for spent nuclear fuel.ATI is well positioned in the global nuclear electrical energy market.ATI has a broad range of nuclear-energy certified

73、corrosion-resistant alloys that are used in power plant reactors,water systems,and spent nuclear fuel applications.In the United States,public opinion,new EPA(Environment Protection Agency)rules,and the new economics of natural gas power generation are leading to potential demand for ATI products fo

74、r pollution control systems and specialty metals used in industrial gas turbines.Demand for ATIs corrosion-resistant alloys is growing for tubing used for solar power and geothermal applications.We are working on several promising new technologies for solar power generation and storage.In addition,w

75、e have begun to see some improvement in demand for wind energy applications.Finally,one way to reduce power generation requirements is to improve the efficiency of electrical energy grid.Our grain-oriented electrical steel is used in power generation transformers.The new,efficient transformers use o

76、ur M2 and M3 grades to meet the U.S.department of Energy efficiency standards.Strong demand for Improved Medical devices and Equipmentdemand for our products from the medical market continues to be strong due to the aging U.S.and European populations and the expansion of medical equipment and device

77、s to the developing world.Strong demand for implantable metallic biomaterials is being driven by the aging population who want to remain active.Our customers are also seeing demand growth for a broader global population for total joint replacement,fracture fixation,pacemakers,and spinal implants tha

78、t use our broad range of high-end medical alloys.ATI is well positioned to grow in this market due to increasingly stringent quality specifications that,in many cases,require our unsurpassed manufacturing capabilities,such as our PAM premium-titanium melt furnace that provides the highest quality ti

79、tanium product.We remain active in product innovation in the medical market and have received good response to our ATI-15Mo titanium alloy and our other improved biocompatible beta titanium alloys for high-cycle fatigue structural implants.Our new ATI35N Lo Ti nickel-cobalt-based alloy has also rece

80、ived good customer response.It is designed to meet the high fatigue strength demands for biomedical applications.demand for our niobium titanium alloys continues to be strong for use in the next-generation MRI(Magnetic Resonance Imaging)equipment.The 3 Tesla models provide twice the magnetic field s

81、trength compared to the conventional 1.5 Tesla models,allowing for a significantly improved image.Product and Process InnovationInnovation is essential in our business.This is an exciting time to be a leader in specialty metals as our customers invent new airplanes and jet engines,search for energy

82、in more difficult environments,improve efficiency in transportation and electrical energy,and produce products that work better and last longer.Our strategy is to innovate faster than our competition in order to maintain and enhance our technology leadership.We have identified nearly$2 billion in po

83、tential new annual revenue growth over the next five years from our new manufacturing capabilities and innovative new products.There is innovation and then there is game-changing innovation.We focus on both.To meet the ever increasing demands of our customers,we need unsurpassed manufacturing capabi

84、lities to achieve the process complexities of the new alloys.For example,while the traditional titanium alloy for jet engines has been 6-4 titanium,the next-generation and future-generation jet engines require more ATI 17 alloy,ATI 6-2-4-2 alloy,and titanium aluminides.Similarly,while the workhorse

85、nickel-based superalloy has been 718,hotter-burning,next-generation and future-generation jet engines require ATI 718Plus alloy,ATI 720 alloy,powder metals,as well as other new ATI proprietary alloys.In June 2011,we signed a long-term agreement with Rolls-Royce to supply ATI 718Plus alloy for rotati

86、ng parts.We also have a long-term supply agreement for this innovative new alloy with GE Aviation.ATI 718Plus alloy is being used in many legacy and next-generation jet engines where standard 718 alloy would be pushed beyond its capabilities.ATI continues to expand our product portfolio,targeting di

87、fficult-to-manufacture nickel-based alloys needed for the current and next-generation jet engines and electrical energy turbines.Our new TSAF(Titanium and Superalloy Forging)facility in Bakers,NC,which is the largest and most powerful in our industry,enables development of larger ingots and billets

88、of more complex superalloys that allow new engines to burn hotter in order to meet stricter efficiency requirements.The addition of ATI Powder Metals and ATI Ladish has created new opportunities for collaboration and development,bringing ATI closer to the end users.We are now able to bring our next-

89、generation of products for aerospace to market faster and at a better value proposition for our customers.One tool we use is modeling to estimate microstructural evolution from raw materials to finished components.We can run multiple trials,examining the effects of a variety of conditions and find t

90、he optimal solution to reach the required material condition.“ATI is not the same company it was five years ago,and to be successful five years from now,ATI cannot be the same company that it is today.“The addition of ATI Powder Metals and ATI Ladish has created new opportunities for collaboration a

91、nd development,bringing ATI closer to the end users.ATI ANNUAL REPORT 2011 7MESSAGE FROM THE CHAIRMAN,PRESIdENT ANd CHIEF EXECUTIVE OFFICERSignificant progress has been achieved in the commercialization of ATI 425 alloy within the aerospace market.Work conducted by aerospace OEMs and Tier 1 supplier

92、s has confirmed that ATI 425 alloy provides super plastic forming(SPF),hot forming and diffusion bonding at lower temperatures,compared to 6-4 titanium alloy.This characteristic leads to a lower overall cost to manufacture the part or fabricated component.ATI 2102 Lean duplex Alloy is a new addition

93、 to our family of duplex alloys.ATI 2102 alloy contains less nickel and molybdenum than our other lean duplex alloy,ATI 2003 alloy.ATI 2102 alloy has been selected for applications in the oil and gas market.We have developed a new line of borated stainless steels that begin with our powder metals an

94、d are available in plate and sheet product forms.A primary use of this alloy is for spent nuclear fuel storage applications.2012 Outlook:Strong Secular Growth ContinuesStrength in our key growth markets continues to give us confidence for 2012 and beyond.While macroeconomic challenges and uncertaint

95、ies exist,we are cautiously optimistic about 2012.ATIs diversification,focus on differentiated growing global markets,commitment to new product and technology development,and unsurpassed manufacturing capabilities and continued focus on cost reductions and manufacturing efficiencies are critical to

96、our growth strategies.While secular growth trends remain intact in our key global markets,we are cautious on the recovery in our short-cycle markets and are awaiting further evidence to show sustainable improvement in the U.S.unemployment rate and consumer confidence.We also await favorable resoluti

97、on of the euro-zone debt issues.In our High Performance Metals segment,we expect to benefit from growing demand in our key global markets,increasing synergies at ATI Ladish,improving cost structure at our Rowley,UT titanium sponge facility,additional premium-titanium PAM capacity,and increasing dema

98、nd for our new alloys and products.In our Flat-Rolled Products segment,we expect to continue to benefit from growing demand for many of our high-value products from our key growth markets.We also believe that demand from the automotive market can be much better in 2012 than it has been since the las

99、t strong auto cycle in 2007.We also expect improved demand for our products from the transportation market for rail cars and truck trailers.In our Engineered Products segment,we expect demand to continue to be strong from three of this segments largest markets,which are oil and gas,construction and

100、mining equipment,and aerospace.Positioned to Capitalize on What We do WellWe are positioned to capitalize on what we do well.Our future is being invented by the people of ATI,and we expect to benefit from our technology and product diversification,both in terms of alloys and product forms.ATI has lo

101、ng been a leader in specialty metals technology and our capital investments and new alloy innovations are aimed at maintaining and enhancing our mission-critical role.Our future is being driven by the demands of the worlds citizens for mobility,manufactured goods,clean air and water,and a modern inf

102、rastructure and by our customers who make the products to meet these demands.ATI is focused on developing the technology and products that enable social progress and industrial development throughout the world.We have a defined view of the future and we have the financial means and people to continu

103、e to move ATI forward.Value-Based Leadership Value-Based Leaders are the true difference in companies that move people to new levels of achievement and success.To move our Company forward,I look for the leaders within ATI who demonstrate commitment to these key core values:Integrity as the Cornersto

104、ne of our business.To that end,we must be honest and forthright in everything we do.We expect everyone to be treated with dignity and respect and we embrace the values of cooperation,diversity,and teamwork.ATI is committed to more than just adherence to laws and regulations.Our commitment is to refl

105、ect the highest level of integrity and ethics in our dealings with each other,our customers,our suppliers,our stockholders,the public,and the government agencies with whom we engage.Personal accountability for outcomes ensures the long-term success of ATI.Safety,Health and Environmental Compliance a

106、re the prerequisites to all operations,and our goal is to finish each day incident-and injury-free.Product Quality and Excellence is demonstrated in everything we do.Technology,Creativity,Learning,and Freedom of people to reach their individual potential is ATIs culture.Our commitment to Do Whats Ri

107、ght continues to guide us throughout our global operations and business activities.In Building the Worlds Best Specialty Metals Company,we aim to do more,make our products better,and implement and execute faster through the ATI Business System(ATIBS).ATIBS drives our lean manufacturing initiatives,i

108、mproves safety,quality and yields,leads to improved productivity and cost efficiencies,and delivers excellent customer reliability and service.I want to personally thank our stockholders,our employees,our suppliers and the communities in which we operate our businesses for their continued support of

109、 ATI.I would also like to thank our Board of directors for their advice,counsel,and continued support of our efforts to create long-term sustainable value for our customers and stockholders.Richard J.HarshmanChairman,President and Chief Executive OfficerRotary AircraftLarge Commercial AircraftDefens

110、e AircraftSingle-AisleCommercial AircraftJet EnginesTitanium AlloysNickel-Based AlloysSpecialty AlloysATI has two titanium sponge facilities that are planned to produce premium-quality and standard-quality titanium sponge when qualified.Raw MaterialTitanium products are melted and refined using PAM,

111、EB,and VAR.Nickel-based alloys and specialty alloys use a VIM(Vacuum Induction Melt)to VAR remelt path.Melt&RemeltPlasma Arc Melt is a superior cold-hearth melt process for making premium-titanium alloys for aerospace jet engine,medical and other critical applications.PAMElectron Beam melt is used t

112、o produce large ingots and slabs of both CP titanium and alloy titanium.EBVacuum Arc Remelt is a consumable remelting process that is used in the primary melt of titanium alloys and in the refining process of nickel-based alloys and specialty alloys.VARAdvanced and complex nickel-based superalloys c

113、an be produced as powders including the steps of atomizing,screening,blending,and pressing to consolidate metal powders.PowdersATI has a variety of forging capabilities.Our newest press forge is rated at 10,000 tons of force and is the most powerful in our industry.Press ForgeATI also has a variety

114、of rotary and radial forging capabilities.Our newest such asset is a 700mm radial forge and is the largest such forge in the world for producing our specialty alloys.Radial/Rotary ForgeATIs long-products rolling mill is the most modern and most versatile of its kind.It produces titanium alloy,nickel

115、-based superalloy,and specialty alloy bar,rod and coil products.Rolling Mill The primary advantage of isothermal forging is closer tolerances and the ability to forge complex alloys.ATI has the worlds largest isothermal forge presses.Isothermal Forge Titanium investment casting is designed to achiev

116、e high dimensional accuracy.ATI has the capability to design components with intricate geometries,cored passageways,cast-in features,and sculpted surfaces.Investment CastingsINTEGRATED AEROSPACE SUPPLY CHAINMaximizing Performance Through Materials&Manufacturing Know-How8 ATI ANNUAL REPORT 2011 Since

117、 2004,ATI has been transformed by investing over$3.3 billion in capital expenditures and asset acquisitions.We are now integrated in titanium alloys,nickel-based alloys,and specialty alloys from raw materials(titanium sponge)through melting and forging of mill products and complexshapes,to precision

118、 machined forged and investment castparts and components.We offer our aerospace customersa seamless,real supply chain.ATI ANNUAL REPORT 2011 9BarBilletRolled ShapeCast ComponentsForged ComponentsFastener StockRotary AircraftLarge Commercial AircraftDefense AircraftSingle-AisleCommercial AircraftJet

119、EnginesThrough our Ladish acquisition,ATI now has extensive capabilities in precision machining for aerospace parts.Precision MachiningATI provides customers with value-added near-net-shape products.For the aerospace supply chain,we provide machined components such as jet engine shafts.Machining&Fin

120、ishingATI designs and develops tooling and cutting tool systems to meet the needs of our aerospace supply chain customers.Cutting ToolsTungsten ProductsFan:Disks,Rotor,Blades&Casings ATI 6-4 Titanium ATI 6-2-4-2 Titanium ATI 17 TitaniumFasteners ATI 6-4 Titanium ATI 425 Titanium ATI 45Nb Titanium AT

121、I 718 Nickel ATI 718Plus Nickel ATI 17-7 Stainless ATI A286 SteelExhaust Cones,Mufflers&Thrust Reversers ATI 718 Nickel ATI 718Plus Nickel ATI 617 Nickel ATI 625 Nickel ATI HX Nickel ATI C-103 NiobiumShafts,Gears&Bearings ATI 718 Nickel ATI 1014 Steel ATI C-250 Steel ATI HCM3 Steel ATI HCM5 Steel AT

122、I RBD SteelCombustors&Liners ATI 718 Nickel ATI 718Plus Nickel ATI HX Nickel ATI L-605 Cobalt ATI 188 CobaltCasings&Rings ATI 718 Nickel ATI 718Plus Nickel ATI 263 Nickel ATI 625 Nickel ATI GTD-222 Nickel ATI HX Nickel ATI Waspaloy*Nickel ATI X-750 Nickel ATI A286 SteelAPU Disk ATI 720 PM Nickel Low

123、 Carbon AstroloyHoneycomb,Bellows,Insulation&Tubing ATI 6-4 ELI Titanium ATI 3-2.5 Titanium ATI 6-2-4-2 Titanium ATI 425 Titanium Orthorhombic Ti Aluminide ATI 718 Nickel ATI 718Plus Nickel ATI 600 Nickel ATI 625 Nickel ATI HX Nickel ATI 15-7 Stainless ATI 21-6-9 Steel AM 350 Steel ATI A286 SteelCom

124、pressor&Turbine:Disks,Rotors,Blades,&Vanes ATI 6-4 Titanium ATI 6-2-4-2 Titanium ATI 6-2-4-6 Titanium ATI 8-1-1 Titanium ATI 17 Titanium Gamma Ti Aluminide ATI 718 Nickel ATI 718Plus Nickel ATI 720 Nickel ATI 901 Nickel ATI HX Nickel ATI Waspaloy*Nickel ATI Rene 95 PM Nickel ATI A286 Steel ATI FV448

125、 Steel ATI FV535 Steel ATI M152 Steel10 ATI ANNUAL REPORT 2011AEROSPACE ENGINESMission Critical Metallics for Aerospace 2012 ATI.All rights reserved*Trademark of Pratt&WhitneyVersion 4 05/11ATI ANNUAL REPORT 2011 11AEROSPACE ENGINESATIs customers in the aerospace market are focused on improving the

126、sustainability of their products.To them,this means greater fuel efficiency,reduced emissions,quieter operations,improved reliability(reduced maintenance costs)and reduced maufacturing,fabrication,and assembly costs.To ATI,this means using our leading technology and unsurpassed manufacturing capabil

127、ities to seize new opportunities to create customer value through new products and innovation.For the Aerospace MarketIn the United States,the Federal Aviation Administrations Continuous Lower Emissions,Energy and Noise(CLEEN)Program has mandated a 33%reduction in aircraft fuel burn,a 32 decibel red

128、uction in noise,and a 60%reduction in NOx emissions,relative to current aircraft by 2015.The Advisory Council for Aeronautics Research in Europe,(ACARE)has established a 50%reduction in CO2 emissions,an 80%reduction in NOx emissions,and a 50%reduction in noise levels by 2020.Both CLEEN and ACARE pro

129、grams are joint government industry consortia.Boeing has said they are committed to reducing the environmental footprint of their airplanes and they are devoting 75%of their research and development budget to improving fuel burn and noise.Airbus has publicly recognized the need for sustainable devel

130、opment in air travel.For jet engines,GE Aviation has made its GEnx and GE90 engines for large aircraft,and CFM International LEAP-X engines for the new single aisle aircraft part of its“ecoimagination”product portfolio.Rolls-Royce reports that it is investing two thirds of its research and developme

131、nt budget to improve the environmental performance of its products.Pratt&Whitney is introducing its PurePower Engines that offer improvements in fuel consumption,noise,environmental emissions,and operating costs.These companies agree that the development and application of advanced materials is fund

132、amental to achieving their sustainability objectives.The Boeing 787 and Airbus A350XWB both use more titanium as a percentage of weight to help meet their fuel efficiency and maintenance performance objectives.The engines that power these innovative airplanes,the GEnx and the Rolls-Royce Trent 1000

133、and Trent XWB,are designed to provide improved fuel consumption,lower emissions,and reduced maintenance costs.The trend to better performance is also moving to the new future-generation single aisle aircraft,which are designed to fly cleaner,quieter,and to be more fuel efficient than ever.These new

134、single aisle aircraft,the Boeing 737Max,Airbus A320neo,and COMAC(Commercial Aircraft Corporation of China)C919,are in the design phase.They will use newly designed engines,such as the LEAP-X and Pratt&Whitneys PW1000G or geared turbofan(GTF)engine family.The role of advanced materials in improving t

135、he fuel efficiency and reducing emissions in aero engines is related in large part to the increased efficiencies enabled by higher operating temperatures.Hotter running engines demand components capable of withstanding the harsher environment without sacrificing performance.New generations of alloys

136、 are replacing incumbent alloys to achieve the necessary performance.New nickel-based superalloys and powder metal alloys are being specified for use in the hotter sections of jet engines.Many of these new and innovative products are already a part of ATIs product portfolio.ATI 718Plus Alloy is an e

137、xcellent example of this trend.It is a nickel-based superalloy that is capable of operating at temperatures well in excess of standard 718 alloy,the primary superalloy used in todays jet engines.ATI 718Plus Alloy is replacing 718 alloy as well as more expensive alloys used in a variety of applicatio

138、ns including turbine cases,disks and blades due to its combination of excellent performance with lower raw material cost.ATI 718Plus Alloy was selected by the Metals Affordability Initiative Consortium,which was formed to maintain Americas technological leadership in the strategic aerospace metals m

139、arket,as the best option for structural applications requiring long-term structural integrity at temperatures up to 1300 F(704C).Complex and advanced nickel-based superalloy powders are being designed into the next-generation and future-generation jet engines to meet the need for higher-strength,hig

140、her-temperature alloys.Powder metals parts are made either as near-net-shape parts or are forged into parts through the isothermal forging process.driven by this design trend and to expand our product reach and add greater customer value to the aerospace supply chain,we purchased ATI Powder Metals i

141、n 2009 and acquired ATI Ladish in 2011.ATI Powder Metals is one of the few companies capable and qualified to produce advanced nickel-based alloy powders.ATI Ladish is a leader in isothermal forging technology and has the industrys largest isothermal forging press.Gamma titanium aluminides are repla

142、cing lower temperature-capable nickel-based superalloys,such as 718 alloy,in the next-generation and future-generation jet engines.Gamma titanium aluminides provide significant weight savings without degradation in operating performance.Standard titanium alloys are being challenged by the increase i

143、n engine operating temperatures and being pushed toward the front(colder)section of the engine.Even in the cold section of the jet engine,design pressures are increasing and causing a shift from the most common titanium alloy,6-4 titanium,to more complex titanium alloys such as ATI 17 alloy,ATI 6-2-

144、4-2 alloy,and ATI 6-2-4-6 alloy.Plasma Arc Melt(PAM)is the preferred melt method for these complex alloys,and ATI is the only qualified titanium producer to use PAM to produce premium-titanium alloys for jet engine rotating parts.Titanium AlloysNickel-Based AlloysSpecialty AlloysTitanium products ar

145、e melted and refined using PAM,EB,and VAR.Nickel-based alloys and specialty alloys use a VIM(Vacuum Induction Melt)to VAR remelt path.Some specialty alloys are melted and refined using the EAF/ESR path.Melt&RemeltElectric Arc Furnace is an open air melt in which scrap and alloys are melted.The proce

146、ss is often used in conjunction with subsequent refining.EAFElectroslag Remelt is a refining process used to improve the cleanliness and structure of alloys.ESRElectron Beam melt is used to produce large ingots and slabs of both CP titanium and alloy titanium.EBATIs specialty plate facility produces

147、 an unmatched array of products including titanium and titanium alloy,nickel-based and specialty alloy and duplex and stainless alloy products.It produces what we believe to be the largest and flattest CP and alloy titanium plate in the world.Specialty PlateATIs specialty sheet facility produces an

148、unmatched array of products including titaniumand titanium alloy,nickel-based and specialty alloy and duplex and stainless alloy products.ATI has a variety of rotary and radial forging capabilities.Our newest such asset is a 700mm radial forge and is the largest such forge in the world for producing

149、 our specialty alloys.ATIs Precision Finishing Facility in Sheffield,UK provides value-added products to the oil&gas supply chain such as nickel-based alloy rotary steerable drill shafts and specialty alloy drill collars.Specialty SheetRadial/Rotary ForgeMachining&FinishingINTEGRATED OIL&GAS SUPPLY

150、CHAINMaximizing Performance Through Materials&Manufacturing Know-How12 ATI ANNUAL REPORT 2011 ATI has also developed a unique supply chain for the Oil&Gas market.We offer an extensive array of high-strength,corrosion-resistant materials,and cutting tools necessary for the most challenging Oil&Gas ex

151、ploration,drilling,production,and refining applications.An advantage of ATI is our multi-materials capabilities and our ability to provide our customers with the optimal solution to meet their corrosion and high-strength requirements.ATI ANNUAL REPORT 2011 13SheetPlatePowder MetalsDrill BitsSeamless

152、 TubePipe LinesDownholeRefineriesNatural GasSubseaTopsideAerospace and defenseMajor Products Nickel-and cobalt-based alloys and superalloys,titanium alloys,vacuum-melted specialty alloys for commercial and military jet engines Titanium alloys,vacuum-melted specialty alloys,high-strength stainless al

153、loys,and forged and machined components for commercial and military airframe components for airframe structural parts Titanium investments castings for airframe and jet engine structural components Titanium alloy tubing and nickel-titanium shape memory alloy for aerospace hydraulic systems Titanium

154、alloys and specialty alloys for fasteners High strength stainless alloys for composite helicopter blades High temperature niobium and tantalum alloys for rocket nozzles and jet engine components Tungsten materials for cutting tools and for counter-balance weights The patented high fracture toughness

155、 alloy ATI 13-8Mo SuperTough Alloy ATI 500-MIL high-hard steel,CP titanium,and ATI 6-4-MIL titanium plate for armor applications Indexable and solid carbide milling systems for aerospace metals Near-net-shape powder metal superalloys for commercial and military jet enginesMajor Growth Opportunities

156、ATI 718Plus alloy for jet engine applications ATI 425 Alloy titanium plate,sheet,foil,bar,and wire for airframe and defense applications ATI 17-4 and ATI 17-7 plate for airframe,military,and armor components Electron Beam(EB)single melted titanium alloy for commercial airframe applications Shapes fo

157、r airframe applications Titanium sheet for airframe and jet engine applications Through-coolant solid carbide drill technology for drilling titanium and nickel-based alloy airframe components Precision threading tools for threading titanium aerospace fasteners Powder metal near-net-shapesMajor Emerg

158、ing Technologies Titanium aluminide and nickel-titanium alloys for armor and other military applications Patented tungsten carbide composite drills and end mills for machining airframe and engine componentsOil&Gas/Chemical Process IndustryMajor Products Corrosion Resistant Alloys(CRAs)such as duplex

159、 stainless,super stainless,nickel-based,and titanium alloys for seawater environments,such as offshore oil and gas applications,and desalination projects Premium-melted specialty alloys and engineered products for drilling and measurement tools ATIs proprietary ATI Datalloy 2 non-magnetic stainless

160、drill collars for horizontal and directional drilling in challenging unconventional environments such as shale oil and gas and oil sands deposits Advanced nickel and titanium alloys for completions in severe wellbore environments Tungsten-based materials for earth boring bits,flow regulators,metal c

161、utting tools and high density applications for fracking Nickel-based superalloys,titanium alloys,and premium-melted specialty alloy products for petrochemical and refinery applications Titanium castings for pumps and valves Zirconium products for sulfuric,nitric,acetic,and formic acids and urea proc

162、essing CP titanium,nickel-based alloys,and stainless alloys for plate frame heat exchangers CRAs and titanium for weld overlay and cladded components such as flowline pipe Seamless titanium tubing for Liquefied Natural Gas heat exchangersMajor Growth Opportunities ATI 2003 and ATI 2102 lean duplex a

163、nd Zeron 100 super duplex stainless Powder metal near-net-shapes for wellhead oil and gas applications Forged and machined componentsMajor Emerging Technologies ATI 2003 lean duplex stainless for offshore platforms and subsea flexible flowlines and risers Patented tungsten composite tooling for mach

164、ining valve and pump components ATI OmegaBond tubing for fertilizer and chemical processing Solid tungsten carbide bodies for diamond-based drill bits Nickel-based alloys for handling corrosive sour gas and petroleum reservoirs14 ATI ANNUAL REPORT 2011WHAT WE MAKE ANd WHERE IT GOESElectrical EnergyM

165、ajor Products Titanium,superferritic and duplex stainless steels,and nickel-based alloys for seawater environments Grain-oriented electrical steels for power distribution and power generation transformers Nickel-based superalloys,titanium alloys,and vacuum-melted specialty alloys for gas and steam t

166、urbine components Reactor-grade zirconium and hafnium products for nuclear fuel cladding and structural applications Tungsten carbide for centrifuge tiles,coal crushers,and fan blades Tungsten carbide for machining turbine blades and shafts Ductile iron castings for wind turbines,gas turbines,and st

167、eam turbines ATI Densalloy tungsten alloys for shielding in nuclear power plantsMajor Growth Opportunities Oxidation resistant alloys for land-based turbines Corrosion and oxidation resistant alloys and bi-metallics for fuel cells CRAs for flue gas desulfurization pollution control equipment Stainle

168、ss and specialty stainless alloys for solar energy applications Titanium alloy and CRA tubing for geothermal wells Tungsten heavy alloys for nuclear energy safety pumps Through-coolant solid carbide drill technology for drilling heat-exchanger tube sheets Powder metals for pumps and steam turbine co

169、mponents for nuclear energy plants ATI 690 nickel alloy for steam generator components ATI NuShield borated stainless steel alloys for spent nuclear fuel storage and containmentMajor Emerging Technologies ATI 718Plus alloy for industrial gas turbines Niobium-titanium,niobium alloys,and vanadium allo

170、ys for magnetic confinement of high temperature plasma in fusion reactors Ruthenium-based tungsten carbide for machining turbine blades Medical Major Products Titanium and titanium alloys,cobalt-based alloys,and zirconium-niobium alloys for surgical implants,medical equipment,and multi-component imp

171、lant constructs Forging and machining bar stocks for total hip and total knee replacement systems Titanium and titanium alloy bar and rod for fracture fixation devices,pins,screws,spinal rods,and fasteners Titanium and titanium alloys for dental implants and cardiovascular devices Titanium sheet and

172、 foil for maxillofacial implant components Niobium-titanium alloy for superconducting magnets to power MRI imaging equipment Tungsten products for MRI shielding applications Cobalt-based alloys for spinal implants and pacemaker lead wires Tungsten for diagnostic isotope vial and dose shielding Tungs

173、ten carbide for machining medical implants Titanium sheet and Precision Rolled Strip products for pacemakers and surgical implantsMajor Emerging Technologies Titanium alloy seamless tubing for bone nails and screws Boutique alloys(ATI 15Mo Titanium,ATI 35N LoTi alloys)designed to meet high fatigue s

174、trength demands for biomedical applications Improved biocompatible,beta titanium alloys for high-cycle fatigue structural implants Powder metals for complex near-net-shape components in implant constructsATI ANNUAL REPORT 2011 15For more information on:Aerospace and defense,visit ATI and ATI Oil&Gas

175、/Chemical Process Industry,visit ATI and ATI Energy,visit ATI and ATI ATI WE MAKE ANd WHERE IT GOES16 ATI ANNUAL REPORT 2011ATI PROdUCTS ANd MARKETS$0$1,000$2,000$3,000$4,000$5000$6000MillionsTitaniumNickel-Based Alloys and Specialty AlloysExotic AlloysGrain-Oriented Electrical SteelPrecision and En

176、gineered StripTungsten-Based MaterialsForged and Cast Components2002 2003 2004 2005 2006 2007 2008 2009 2010 2011Diversified Global Markets(Percent of ATIs 2011 Sales)Aerospace and Defense 29%Oil and Gas/Chemical Process Industry 21%Electrical Energy 15%Automotive 7%Construction and Mining 6%Food Eq

177、uipment and Appliances 5%Medical 5%Transportation 4%Electronics/Communication/Computers 3%Machine and Cutting Tools 3%Conversion Services/Other 2%Total 100%Diversified Products and Services(Percent of ATIs 2011 Sales)High-Value Products Nickel-Based Alloys and Specialty Alloys 25%Titanium and Titani

178、um Alloys 14%Precision and Engineered Strip 12%Forged and Cast Components 9%Tungsten-Based Materials 7%Grain-Oriented Electrical Steel 6%Exotic Alloys 5%Total High Value 78%Standard Products Specialty Stainless Sheet 10%Stainless Steel Sheet 9%Stainless Steel Plate 2%Iron Castings 1%Total Standard P

179、roducts 22%Grand Total 100%Sales by Geographic Area(Percent of ATIs 2011 Sales)United States 65%Europe 20%Asia 10%Canada 3%South America,Middle East,Rest of World 2%Total 100%High-Value Products SalesInternational Sales%of Total Sales2002 2003 2004 2005 2006 2007 2008 2009 2010 20110%5%10%15%20%25%3

180、0%35%Millions$2,000$1,800$1,600$1,400$1,200$1,000$800$600$400$200$0Direct International Sales(Percent of ATIs Total Sales)ATI ANNUAL REPORT 2011 17SEGMENT INFORMATIONFinancial Results($in millions)Major Products Major MarketsHigh Performance Metals 2011 2010 Sales$1,955.9$1,337.5Operating Profit$364

181、.5$257.8Percent of Sales 18.6%19.3%Identifiable Assets$3,659.8$2,283.2International Sales$784.2$438.1 Major Products Major MarketsFlat-Rolled Products 2011 2010Sales$2,726.0$2,338.5Operating Profit$213.4$85.9Percent of Sales 7.8%3.7%Identifiable Assets$1,577.6$1,362.0International Sales$916.2$758.1

182、Major Products Major MarketsEngineered Products 2011 2010 Sales$501.1$371.8Operating Profit$34.1$12.8Percent of Sales 6.8%3.4%Identifiable Assets$315.2$295.5International Sales$113.7$87.737%Titanium&Titanium Alloys68%Tungsten Materials1%ConversionServices6%CastMaterials25%Forged Materials27%Oil&Gas/

183、CPI17%Machine andCutting Tools16%Transportation14%Construction/Mining8%Electrical Energy8%Aerospaceand Defense6%Automotive2%Other2%Medical23%Precision&Engineered Strip19%Specialty StainlessSheet16%StainlessSteel Sheet21%Nickel andSpecialty Alloys11%Grain-OrientedElectrical Steel6%Titanium&Titanium A

184、lloys4%StainlessPlate29%Oil&Gas/CPI21%Electrical Energy13%Automotive8%Food Equipmentand Appliances8%Construction/Mining7%Aerospace andDefense6%Electronics/Communication/Computers5%Transportation1%Other2%Medical34%Aerospace Jet Engines15%Aerospace Air Frames9%Oil&Gas/CPI9%ElectricalEnergy10%Governmen

185、tAerospace7%Other9%Medical38%Nickel-BasedAlloys/Superalloys14%Exotic Alloys8%SpecialtyAlloys5%Defense3%OtherMetals2%Construction/Mining37%Titanium&Titanium Alloys68%Tungsten Materials1%ConversionServices6%CastMaterials25%Forged Materials27%Oil&Gas/CPI17%Machine andCutting Tools16%Transportation14%Co

186、nstruction/Mining8%Electrical Energy8%Aerospaceand Defense6%Automotive2%Other2%Medical23%Precision&Engineered Strip19%Specialty StainlessSheet16%StainlessSteel Sheet21%Nickel andSpecialty Alloys11%Grain-OrientedElectrical Steel6%Titanium&Titanium Alloys4%StainlessPlate29%Oil&Gas/CPI21%Electrical Ene

187、rgy13%Automotive8%Food Equipmentand Appliances8%Construction/Mining7%Aerospace andDefense6%Electronics/Communication/Computers5%Transportation1%Other2%Medical34%Aerospace Jet Engines15%Aerospace Air Frames9%Oil&Gas/CPI9%ElectricalEnergy10%GovernmentAerospace7%Other9%Medical38%Nickel-BasedAlloys/Supe

188、ralloys14%Exotic Alloys8%SpecialtyAlloys5%Defense3%OtherMetals2%Construction/Mining37%Titanium&Titanium Alloys68%Tungsten Materials1%ConversionServices6%CastMaterials25%Forged Materials27%Oil&Gas/CPI17%Machine andCutting Tools16%Transportation14%Construction/Mining8%Electrical Energy8%Aerospaceand D

189、efense6%Automotive2%Other2%Medical23%Precision&Engineered Strip19%Specialty StainlessSheet16%StainlessSteel Sheet21%Nickel andSpecialty Alloys11%Grain-OrientedElectrical Steel6%Titanium&Titanium Alloys4%StainlessPlate29%Oil&Gas/CPI21%Electrical Energy13%Automotive8%Food Equipmentand Appliances8%Cons

190、truction/Mining7%Aerospace andDefense6%Electronics/Communication/Computers5%Transportation1%Other2%Medical34%Aerospace Jet Engines15%Aerospace Air Frames9%Oil&Gas/CPI9%ElectricalEnergy10%GovernmentAerospace7%Other9%Medical38%Nickel-BasedAlloys/Superalloys14%Exotic Alloys8%SpecialtyAlloys5%Defense3%O

191、therMetals2%Construction/Mining18 ATI ANNUAL REPORT 2011GLOSSARy OF TERMSATI Business System(ATIBS)A systemic and integrated business system adopted throughout ATI built on three fundamental principles:Make to Use,Elimination of Waste,and People Connect the System.Ammonium Paratungstate(APT)A purifi

192、ed intermediate tungsten compound made from ore or recycled tungsten scrap that is used as a starting material for making most tungsten powders.Annealing The process of heating and cooling metal in such a way as to soften it,and to produce desired changes in other properties or microstructure.Bar A

193、long product that is 1/4 inch(6.35 mm)or more in diameter,having round,square,octagonal or hexagonal cross-sections.Billet A long product with a diameter range of 8 to 14 inches(203 to 356 mm).Can either be sold in billet form or processed further to make other long products.Carbide Cutting Tools Ce

194、mented carbides made into forms for removing materials in machining opera-tions such as turning,milling or drilling.Normally,these tools have hard surface coatings consisting of carbides,nitrides and oxides of titanium and aluminum.Electric Arc Furnace(EAF)An open air melting furnace in which scrap

195、and ferroalloys are melted by high electrical power carbon arcs.Refining is accomplished by slags and various gases.The process is often used in conjunction with subsequent refining processes.Electron Beam Furnace(EB)A melting furnace that uses high-energy electron beams in a vacuum environment to m

196、elt metals into a water-cooled crucible and is especially useful for titanium and exotic alloys.Electroslag Remelt(ESR)A consumable electrode remelting process in which an AC current is passed from an electrode through a molten slag pool.Molten metal droplets fall through the slag and solidify in a

197、water-cooled copper crucible.This process is utilized to improve both the cleanliness and structure of alloys.Exotic Alloys The Companys classification for its products,which includes zirconium,niobium and hafnium.Flat-Rolled Products A product form classification that includes plate,sheet,strip and

198、 Precision Rolled Strip products.Forging A product formed by compressive forces to plastically deform metal into a shape.ATI produces forgings as mill products and components such as titanium alloy,nickel-based and superalloy,and specialty alloy billet.ATI also produces carbon and alloy custom compr

199、ession die hot forgings for applications in the transportation,construction and mining,and oil and gas markets.Forging Press A press,usually vertical,used to operate dies to deform metal plastically.May be mechanically or hydraulically operated and either closed die for shaped,part forgings or open

200、die for cogging.GFM Precision Rotary Forge and Radial Forge A forging process where rapid simultaneous action of forging hammers subjects the workpiece to a high rate of deformation under uniform compressive stressing.The control and reproducibility of the GFM process is designed to provide optimum

201、metallurgical consistency.Grain-Oriented Electrical Steel(GOES)Iron-based alloys containing silicon(typically 3.5%)as the major alloying addition.These steels are used generally in applications such as power distribution and power generation transformers where electrical conductivity and magnetic pr

202、operties are important.Hafnium An exotic alloy usually obtained as a by-product of zirconium production with outstanding corrosion resistance and good mechanical properties.It is added to specialty alloys for use in jet engine parts and as control rod material in nuclear reactors.High-Performance Me

203、tals A classification that includes ATIs nickel-based and cobalt-based alloys and superalloys,titanium and titanium alloys,specialty alloys,and exotic alloy products,primarily in the form of long products.These products typically exhibit any of the properties of high temperature resistance,high stre

204、ngth,and high temperature oxidation resistance.High-Value Flat-Rolled Products A classification that includes ATIs Flat-Rolled Products segments titanium and titanium alloys,nickel-based alloys and superalloys,specialty alloys,grain-oriented electrical steel,engineered strip and Precision Rolled Str

205、ip products.These products typically are characterized by direct technical and service relationships with customers.Hot Die Forging A forging process in which dies are heated close to the forging temperature of the alloy being forged.Used for difficult-to-forge alloys.Hot Isostatic Pressing(HIP)A pr

206、ocess of pressing/consolidating powder metals under the simultaneous application of temperature and pressure(equally applied in all directions)to yield 100%dense parts made of specialty metal powders,such as titanium,nickel,and stainless steel alloys.Ingot A product form resulting when molten metal

207、is cast into molds,which can be round,square,or rectangular.Can either be sold in ingot form or processed further to make higher value mill products.Investment Casting A casting method designed to achieve high dimensional accuracy of small metal castings using a pattern which is melted out to leave

208、a mold without joints.Isothermal Forging A hot forging process where the alloy being forged and the dies are heated to the same temperature and maintained at a constant and uniform temperature during the forging process.Process allows for nearer-net-shape forging which reduces machining.Long Product

209、s A product form classification that includes ingot,billet,bar,rod,wire and seamless tubing and custom-rolled shapes.Market Sector Team An ATI initiative whose goal is to integrate and coordinate ATIs global capabilities to offer current and new customers access to the Companys full ATI ANNUAL REPOR

210、T 2011 19range of products,processes,and technical resources.Current ATI Market Sector Teams include ATI Aerospace,ATI Defense,ATI Oil and Gas,and ATI Electrical Energy.Nickel-Based Superalloys Nickel alloys,having nickel as the primary constituent,developed for very high temperature service where r

211、elatively high mechanical stresses are encountered and where high surface stability is frequently required.Typical applications are aircraft turbine and land-based turbine components.Niobium An exotic alloy valued for its strength at extremely high temperatures and its ability to superconduct,or pas

212、s electricity with minimal resistance,at very low temperatures.It is used in aerospace applications,in superconducting magnets in MRI(magnetic resonance imaging)equipment,when alloyed with titanium,and in particle accelerators.Plasma Arc Melt(PAM)A melting furnace that is a superior cold-hearth melt

213、ing process for making alloyed premium titanium products for jet engine rotating parts,medical applications,and other critical applications.Plate A flat-rolled product that is 3/16 inch(4.76 mm)thick,or greater,and over 10 inches(254 mm)wide.Powder Metallurgy The production of specialty metals produ

214、cts by processes including the steps of atomizing,screening,blending,and pressing to consolidate metal powders.Precision Rolled Strip Products Flat-rolled products including stainless,nickel alloys,titanium and titanium alloys,and carbon steel under 0.015 inch(0.38 mm)thick and up to 48 inches(1,219

215、 mm)wide,as well as certain strip products with special tempers and thicknesses.Raw Materials Used in the production of ATIs specialty metals and include recycled scrap metal(containing iron,nickel,chromium,titanium and molybdenum),nickel,titanium sponge,zirconium sand and sponge,ferrochromium,ferro

216、silicon,molybdenum and its alloys,ammonium paratungstate,tungsten scrap,tungsten ore,manganese and its alloys,cobalt,niobium,and other alloying materials.Rings A seamless forged rolled ring with rectangular or other cross-sectional shapes up to 28 feet(8.5 m)in diameter.Rod A long product that is fr

217、om 0.118 inch(3 mm)to 3/4 inch(19 mm)in diameter.Sheet A flat-rolled product that is 24 inches(610 mm)and over in width and less than 3/16 inch(4.76 mm)thick.Stainless A broad classification of iron-based alloys containing at least 10%chromium,known for excellent corrosion and heat resistance.Austen

218、itic(Chrome-Nickel)grades contain 16%to 30%chromium and 4%to 20%nickel for enhanced sur-face quality and formability and increased corrosion and wear resistance.These grades are used in appliances,kitchen utensils,processing equipment and a variety of industrial applications.Ferritic(Chrome)grades a

219、re non-nickel-bearing and contain 11%to 17%chromium content for greater inherent strength and corrosion resistance than carbon steel.These grades are often used in automotive exhaust systems.Standard Flat-Rolled Products A classification that includes ATIs Flat-Rolled Products segments stainless hot

220、 and cold rolled sheet,strip,and plate products.Strip A flat-rolled product 3/8 inch(9.5 mm)to under 24 inches(610 mm)wide and less than 3/16 inch(4.76 mm)thick.See also Precision Rolled Strip Products.Super Stainless Stainless alloys with significant additions of chromium,nickel,molybdenum or coppe

221、r.Super stainless is used in chemical processing,oil and gas,marine,heat treating,pollution and waste control industries where there are requirements for extra corrosion protection,strength or heat resistance.Superalloy An alloy,usually based on nickel,cobalt or iron,developed for high temperature s

222、ervice where relatively severe mechanical stress is encountered and where high surface stability is frequently required.Titanium Titanium and its alloys have very high strength-to-weight ratios.At normal tem-peratures,they have high resistance to corrosion.Used primarily in aerospace and defense,che

223、mical processing industry,oil and gas,and medical markets.Titanium Sponge Titanium sponge is a critical raw material used to produce titanium mill products.ATI produces titanium sponge using the Kroll Process,which reduces titanium tetrachloride with magnesium.The titanium sponge with or without the

224、 addition of titanium scrap is melted into ingots or slabs.Tungsten Carbide Graded Powders Tungsten carbide powder,made by blending with other powder constituents like cobalt,tantalum carbide,and niobium carbide to obtain a desired composition and carbide grain size.These powders are pressed to a de

225、sired shape and then sintered in the range 1350 to 1500 Centigrade to yield a cemented carbide part.Tungsten Materials Include tungsten and tungsten carbide powders,sintered tungsten carbide products and cutting tools for the mining,oil and gas,and other industries requiring cutting tools with extra

226、 hardness.Vacuum Arc Remelt(VAR)A consumable remelting process in which a high current DC arc is maintained under vacuum between an alloy electrode and a molten metal pool contained in a water-cooled copper crucible.Sequential melting produces an ingot with good internal structure,good surface finis

227、h,and excellent chemical homogeneity.Vacuum Induction Melt(VIM)A melting process that uses an induction furnace inside a vacuum chamber to melt and cast nickel-based alloys,superalloys,and specialty alloys.The process is normally used for grades which require a high alloy content,precise chemistry c

228、ontrol and low impurity levels.Wire A long product that is from 0.030 inch(0.76 mm)to 1/4 inch(6.35 mm)in diameter,in round,square,octagonal or hexagonal cross-sections.Zirconium An exotic alloy valued for its strength,high corrosion resistance,and low thermal neutron absorption.Applications include

229、 nuclear reactors,marine vessels,com-mercial power generation,and those requiring contact with strong acids and basic environments.Our Commitment to IntegrityWe at ATI are committed to a strong self-governance program.We have long believed that honesty and integrity are vitally important to the succ

230、ess of our Company.The Companys Corporate Governance Guidelines along with the charters of the Board committees provide the framework for corporate governance of ATI.These Guidelines reflect the Boards commitment to monitor the effectiveness of decision making at the Board and management levels,with

231、 a view toward achieving ATIs strategic objectives.The Corporate Governance Guidelines are available on our website,www.ATI.Our Corporate Guidelines for Business Conduct and Ethics apply to all directors,officers,employees,agents and consultants and set forth clear standards to guide the conduct of

232、our daily affairs.Our commitment is to reflect,in each of our actions,the highest standards of ethical performance in our dealings with our Board of directors,stockholders,fellow employees,customers,suppliers,creditors,government agencies and authorities,and the public.Our self-governance efforts in

233、corporate long-standing training programs that address a myriad of subjects including antitrust,ethics,environmental compliance,anti-bribery,export compliance and trading in securities,as well as training in various human resources issues,including safety.In order to monitor the effectiveness of our

234、 compliance efforts,we perform audits throughout the organization to confirm adherence to Company policies and procedures and financial controls.We understand that confidence in our Company is in large measure dependent upon the reliability and transparency of our financial statements,including main

235、taining effective internal control over financial reporting.Accordingly,our commitment to integrity in financial reporting recognizes our responsibility for providing timely information that fairly reflects our financial position and results of operations.We encourage employees to communicate concer

236、ns before they become problems.Our corporate ombudsman and the ethics officers at our operating companies provide confidential resources for employees to surface their concerns without fear of reprisal.We have also retained the services of an independent third party supplier to operate the ATI Ethic

237、s Helpline which provides confidential,secure,and anonymous reporting capability and is available globally 24 hours a day.Building and maintaining trust,respect and communication among our employees are essential to the effectiveness of our self-governance program.Richard J.Harshman Chairman,Preside

238、nt and Chief Executive Officer20 ATI ANNUAL REPORT 2011CORPORATE SELF-GOVERNANCEDale G.Reid Executive Vice President,Finance and Chief Financial OfficerElliot S.Davis Senior Vice President,General Counsel,Chief Compliance Officer and Corporate SecretaryF1 UNITED STATES SECURITIES AND EXCHANGE COMMIS

239、SION Washington,D.C.20549 FORM 10-K (Mark One)Annual report pursuant to Section 13 or 15(d)of the Securities Exchange Act of 1934 For the fiscal year ended December 31,2011 OR Transition report pursuant to Section 13 or 15(d)of the Securities Exchange Act of 1934 For the transition period from to Co

240、mmission file number 1-12001 ALLEGHENY TECHNOLOGIES INCORPORATED(Exact name of registrant as specified in its charter)Delaware 25-1792394(State or other jurisdiction of incorporation(I.R.S.Employer or organization)Identification Number)1000 Six PPG Place,Pittsburgh,Pennsylvania 15222-5479(Address of

241、 principal executive offices)(Zip Code)Registrants telephone number,including area code:(412)394-2800 Securities registered pursuant to Section 12(b)of the Act:Title of each class Name of each exchange on which registered Common Stock,$0.10 Par Value New York Stock Exchange Securities registered pur

242、suant to Section 12(g)of the Act:None Indicate by check mark whether the Registrant is well known seasoned issuer,as defined in Rule 405 of the Securities Act.Yes No Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d)of the Act.Yes No Indi

243、cate by check mark whether the Registrant(1)has filed all reports required to be filed by Section 13 or 15(d)of the Securities Exchange Act of 1934 during the preceding 12 months,and(2)has been subject to such filing requirements for the past 90 days.Yes No Indicate by check mark whether the Registr

244、ant has submitted electronically and posted on its corporate Website,if any,every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T(232.405 of this chapter)during the preceding 12 months(or for such shorter period that the registrant was required to sub

245、mit and post such files).Yes No Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein,and will not be contained,to the best of Registrants knowledge,in definitive proxy or information statements incorporated by reference in Part III

246、of this Form 10-K or any amendment to this Form 10-K.Indicate by check mark whether the registrant is a large accelerated filer,an accelerated filer,a non-accelerated filer,or a smaller reporting company.See definitions of“large accelerated filer,”“accelerated filer”and“smaller reporting company”in

247、Rule 12b-2 of the Exchange Act.(Check one):Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company (Do not check if a smaller reporting company)Indicate by check mark whether the Registrant is a shell company(as defined in Rule 12b-2 of the Exchange Act).Yes No On F

248、ebruary 13,2012,the Registrant had outstanding 106,700,085 shares of its Common Stock.The aggregate market value of the Registrants voting stock held by non-affiliates at June 30,2011 was approximately$6.7 billion,based on the closing price per share of Common Stock on June 30,2011 of$63.47 as repor

249、ted on the New York Stock Exchange.Shares of Common Stock known by the Registrant to be beneficially owned by directors and officers of the Registrant subject to the reporting and other requirements of Section 16 of the Securities Exchange Act of 1934,as amended(the“Exchange Act”),are not included i

250、n the computation.The Registrant,however,has made no determination that such persons are“affiliates”within the meaning of Rule 12b-2 under the Exchange Act.Documents Incorporated By Reference Selected portions of the Proxy Statement for the Annual Meeting of Stockholders to be held on May 11,2012 ar

251、e incorporated by reference into Part III of this Report.5991_FIN.pdf 1F2 INDEX Page Number PART I Item 1.Business F3 Item 1A.Risk Factors F11 Item 1B.Unresolved Staff Comments F14 Item 2.Properties F14 Item 3.Legal Proceedings F15 Item 4.Mine Safety Disclosures F15 PART II Item 5.Market for the Reg

252、istrants Common Equity,Related Stockholder Matters and Issuer Purchases of Equity Securities F16 Item 6.Selected Financial Data F18 Item 7.Managements Discussion and Analysis of Financial Condition and Results of Operations F19 Item 7A.Quantitative and Qualitative Disclosures About Market Risk F41 I

253、tem 8.Financial Statements and Supplementary Data F43 Item 9.Changes in and Disagreements with Accountants on Accounting and Financial Disclosure F82 Item 9A.Controls and Procedures F82 Item 9B.Other Information F85 PART III Item 10.Directors and Executive Officers of the Registrant F85 Item 11.Exec

254、utive Compensation F85 Item 12.Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters F85 Item 13.Certain Relationships and Related Transactions,and Director Independence F86 Item 14.Principal Accountant Fees and Services F86 PART IV Item 15.Exhibits,Financial

255、 Statements and Financial Statement Schedules F86 SIGNATURES 5991_FIN.pdf 2F3 PART I Item 1.Business The Company Allegheny Technologies Incorporated(ATI)is a Delaware corporation with its principal executive offices located at 1000 Six PPG Place,Pittsburgh,Pennsylvania 15222-5479,telephone number(41

256、2)394-2800,Internet website address http:/.References to“Allegheny Technologies,”“ATI,”the“Company,”the“Registrant,”“we,”“our”and“us”and similar terms mean Allegheny Technologies Incorporated and its subsidiaries,unless the context otherwise requires.Our Business Allegheny Technologies is one of the

257、 largest and most diversified specialty metals producers in the world.We use innovative technologies to offer growing global markets a wide range of specialty metals solutions.Our products include titanium and titanium alloys,nickel-based alloys and superalloys,zirconium,hafnium and niobium,advanced

258、 powder alloys,stainless and specialty steel alloys,grain-oriented electrical steel,tungsten-based materials and cutting tools,carbon alloy impression die forgings,and large grey and ductile iron castings.Our specialty metals are produced in a wide range of alloys and product forms and are selected

259、for use in applications that demand metals having exceptional hardness,toughness,strength,resistance to heat,corrosion or abrasion,or a combination of these characteristics.The acquisition of Ladish Co.,Inc.(now ATI Ladish)on May 9,2011 added advanced forgings,titanium investment castings and precis

260、ion finishing capabilities to ATIs product portfolio.Results for ATI Ladish,which principally serves the aerospace&defense market,are included in the High Performance Metals segment from the acquisition date.ATI is a fully integrated supplier from raw material(for titanium)and melt(for other special

261、ty alloy systems)through highly engineered finished components.We focus our advanced specialty metals technology,unsurpassed manufacturing capabilities,and innovative products to serve global end use markets with highly diversified and specialized product offerings.Strategic end use markets for our

262、products include:Aerospace and Defense.We are a world leader in the production of premium titanium alloys,nickel-based and cobalt-based alloys and superalloys,and vacuum-melted specialty alloys used in the manufacture of components for both commercial and military jet engines,as well as replacement

263、parts for those engines.We also produce titanium alloys,vacuum-melted specialty alloys,and high-strength stainless alloys for use in commercial and military airframes,airframe components and missiles.ATI produces unique titanium and high-hard steel alloys as well as engineered parts and castings for

264、 the current and next-generation armored vehicles.Titanium and titanium alloys are critical metals in aerospace and defense applications.Titanium and titanium alloys possess an extraordinary combination of properties,including superior strength-to-weight ratio,good elevated temperature resistance,lo

265、w coefficient of thermal expansion,and extreme corrosion resistance.These metals are used to produce jet engine components such as blades,vanes,discs,and casings,and airframe components such as structural members,landing gear,hydraulic systems,and fasteners.The latest and next-generation airframes a

266、nd jet engines use even more titanium and titanium alloys in component parts in order to minimize weight and maximize fuel efficiency.Our nickel-based alloys and superalloys and specialty alloys are also widely used in aerospace and defense applications.Nickel-based alloys and superalloys remain ext

267、remely strong at high temperatures and resist degradation under extreme conditions.Typical aerospace applications for nickel-based alloys and superalloys include jet engine shafts,discs,blades,vanes,rings and casings.Our specialty alloys include vacuum-melted maraging steels used in the manufacture

268、of aircraft landing gear and structural components,as well as jet engine components.Our titanium alloy,nickel-based alloy,and specialty alloy precision forgings and titanium investment castings are used in aerospace jet engine and airframe applications.ATI also offers tungsten cutting tools and mach

269、ining for difficult-to-machine specialty metals,such as titanium alloys,nickel-based superalloys,and specialty alloys used in airframe,jet engine,and armor applications.We continuously seek to develop innovative new alloys to better serve the needs of this end use market.For example,we developed ATI

270、 718 Plus alloy,a new nickel-based superalloy that can withstand higher temperatures than the standard 718 superalloy,for use in legacy jet engines and the next generation of fuel efficient jet engines.We also developed ATI 425 alloy sheet,a new cold-rollable titanium alloy,that is an alternative to

271、 the most popular high-strength titanium alloys,for use in airframe components.ATI 425-MIL titanium is an innovative new armor alloy that has the advantage of superior formability as compared to conventional high-strength titanium alloys.5991_FIN.pdf 3F4 Demand for our products by the aerospace and

272、defense market has increased significantly over the last several years.Based on current forecasts and existing backlogs reported by the two manufacturers of large commercial aircraft,we expect to benefit from increased production schedules for legacy and next-generation aircraft,and increased demand

273、 for aftermarket jet engine spare parts.Oil and Gas and Chemical Process Industry.The environments in which oil and gas can be found in commercial quantities have become more challenging,involving deep offshore wells,high pressure and temperature conditions,sour wells and unconventional sources,such

274、 as oil and gas shale,liquid natural gas,oil sands,and enhanced oil recovery of existing fields.Challenging offshore environments are in remote locations that are further off the continental shelf,including arctic and tropic locations,often one mile or more below the waters surface.The requirements

275、for equipment,which could operate for up to 30 years in these environments,require the specialty metals that we produce.All of our business segments produce specialty metals that are critical to the oil and gas industry and the chemical process industry.Our specialty metals,including titanium and ti

276、tanium alloys,nickel-based alloys,zirconium alloys,stainless and duplex alloys and other specialty alloys,have the strength and corrosion resistant properties necessary for difficult environments.Global demand for these materials is increasing,particularly in growing markets in Asia,the Middle East,

277、North Africa and South America.Demand for these products in North America is growing due to increased activity in oil and gas shale reserves.We have developed a family of duplex alloys,including ATI 2003,ATI 2102,and ATI 2304 lean duplex alloys,for use in deep-water oil and gas applications.Several

278、of our strip,plate and cast products are NORSOK qualified.The NORSOK standards are developed by the Norwegian petroleum industry and are intended to identify metals used in oil and gas applications that are safe and cost-effective.Our Datalloy2 non-magnetic stainless is used for drill collars that e

279、nable the most advanced directional and horizontal drilling techniques to be guided to the exact position desired for the reservoir.Tungsten is the most dense and heat resistant metal commercially available.One application for our tungsten products is in oil and gas drill bit inserts and bodies.As d

280、rilling methods such as directional and horizontal drilling become more complex,our advanced tungsten carbide materials are often specified in order to enable faster drilling and longer drill bit life.Electrical Energy.Our specialty metals are widely used in the global electric power generation and

281、distribution industry.We believe that U.S.and European energy needs and environmental policies and the electrification of developing countries will continue to drive demand for our specialty metals products that we sell for use in this industry.For electrical power generation,our specialty metals,co

282、rrosion resistant alloys(CRAs)and ductile iron castings are used in coal,nuclear,natural gas,and wind power applications.In coal-fired plants,our CRAs are used for pipe,tube,and heat exchanger applications in water systems in addition to pollution control scrubbers.Our CRAs are also used in water sy

283、stems for nuclear power plants.For nuclear power plants,we are an industry pioneer in producing reactor-grade zirconium and hafnium alloys used in nuclear fuel cladding and structural components.We are a technology leader for large diameter nickel-based superalloys used in natural gas land-based tur

284、bines for power generation.For renewable energy generation,our alloys are used for solar and geothermal applications.We are also one of a few U.S.producers of very large ductile iron castings used for wind turbines.ATI is a premier supplier of certified nuclear-grade alloys and specialty alloys for

285、applications that range from the reactor core to steam water systems to spent-fuel storage,transportation and repository activities.ATI has been a part of the nuclear energy market since the first commercial nuclear energy reactor was built in the United States.We have expanded our production capabi

286、lities and capacity to support expected growth of the nuclear energy market.We have developed Nushield products,a new line of borated stainless alloys that begin with our advanced powder metals and are used for spent nuclear fuel applications.For electrical power distribution,our grain-oriented elec

287、trical steel(GOES)is used in large and small power transformers,where electrical conductivity and magnetic properties are important.In January 2010,the U.S.Department of Energy(DOE)began requiring more efficient transformers,which increases premium grade GOES usage per transformer.ATI is a leading p

288、roducer of these premium grades of GOES.In February 2011,the U.S.DOE proposed a rule that would further raise transformer efficiency standards effective January 2016.This new rule calls for the continued use of GOES in large and small power distribution transformers.Medical.ATIs advanced specialty m

289、etals are used in medical device products that save and enhance the quality of lives.Our zirconium-niobium,titanium-and cobalt-based alloys are used for knees,hips and other prosthetic devices.These replacement devices offer the potential of lasting much longer than previous implant options.Our bioc

290、ompatible nickel-titanium shape memory alloy is used for stents to support collapsed or clogged blood vessels.Reduced in diameter for insertion,these stents expand to the original tube-like shape due to the metals superelasticity.Our ultra fine diameter(0.002 inch/0.051 mm)titanium wire is used for

291、screens to prevent blood clots from entering critical areas of the body.In addition,our titanium bar and wire are used to make surgical screws for bone repairs.5991_FIN.pdf 4F5 Manufacturers of magnetic resonance imaging(MRI)devices rely on our niobium superconducting wire to help produce electromag

292、netic fields that allow physicians to safely scan the bodys soft tissue.In addition,our tungsten heavy alloy materials are used for shielding applications in MRI devices.Enhancing and Expanding Our Manufacturing Capabilities and Capacity.Demand for our products from the aerospace and defense,oil and

293、 gas,chemical process industry,electrical energy,and medical markets increased significantly over the last several years.We have been undertaking a multi-phase program to enhance and expand our capabilities and capacities to produce premium specialty metals aimed at these strategic markets.Over the

294、last eight years we have invested approximately$3.3 billion of internally generated funds to renew and expand our annual titanium sponge production capabilities to approximately 46 million pounds;expand our premium titanium alloy melt and remelt capacity;expand our nickel-based alloy and superalloy

295、melt and remelt capacity;expand our titanium and specialty alloy plate capacity;expand our premium titanium and nickel-based superalloy forging capacity;and double our annual reactor-grade zirconium sponge capacity to 8 million pounds.We believe these investments strengthen and enhance ATIs leadersh

296、ip position in the production of advanced specialty metals.Business Segments We operate in the following three business segments,which accounted for the following percentages of total revenues of$5.18 billion,$4.05 billion,and$3.05 billion for the years ended December 31,2011,2010,and 2009,respectiv

297、ely:2011 2010 2009 High Performance Metals 38%33%42%Flat-Rolled Products 52%58%50%Engineered Products 10%9%8%Information with respect to our business segments is presented below and in Note 14 of the Notes to the Consolidated Financial Statements.High Performance Metals Segment Our High Performance

298、Metals segment produces,converts and distributes a wide range of high performance alloys,including nickel-and cobalt-based alloys and superalloys,titanium and titanium-based alloys,exotic metals such as zirconium,hafnium,niobium,nickel-titanium,and their related alloys,and other specialty alloys,pri

299、marily in long product forms such as ingot,billet,bar,shapes and rectangles,rod,wire,seamless tube,and castings.We also produce nickel-based alloys and superalloys,titanium alloys,and specialty metal powders,and semi-finished near-net-shape products from these advanced powder alloys.Through the acqu

300、isition of ATI Ladish,we produce precision forgings,castings and machined parts.We are integrated from raw materials(sponge)to melt,remelt,finish processing,forging,investment casting,and machining in our titanium and titanium alloys,and zirconium and hafnium alloys products.The major end markets se

301、rved by our High Performance Metals segment are aerospace and defense,oil and gas,chemical process industry,electrical energy,and medical.Most of the products in our High Performance Metals segment are sold directly to end-use customers.A significant portion of our High Performance Metals segment pr

302、oducts are sold under multi-year agreements.The operating units in this segment are ATI Allvac,ATI Allvac Ltd(U.K.),ATI Ladish,ATI Wah Chang,and ATI Powder Metals.Approximately 64%of High Performance Metals segment revenue is derived from the aerospace and defense market.Demand for our products is d

303、riven primarily by the commercial aerospace cycle.Large aircraft and aircraft engines are manufactured by a small number of companies,such as The Boeing Company,Airbus S.A.S.(an EADS company),Bombardier Aerospace(a division of Bombardier Inc.),and Embraer(Empresa Brasileira de Aeronutica S.A.)for ai

304、rframes,and GE Aviation(a division of General Electric Company),Rolls-Royce plc,Pratt&Whitney(a division of United Technologies Corporation),Snecma(SAFRAN Group),and various joint ventures that manufacture jet engines.These companies and their suppliers form a substantial part of our customer base i

305、n this business segment.ATI supplies the aerospace and defense supply chain with nickel-and cobalt-based alloys and superalloys,titanium alloys,vacuum-melted specialty alloys,and advanced powder alloys for commercial and military jet engines,for both original engines and spare parts.For commercial a

306、nd military airframe and structural parts,ATI manufactures titanium alloys,vacuum-melted specialty alloys,and high-strength stainless alloys.The loss of one or more of our customers in the aerospace and defense market could have a material adverse effect on ATIs results of operations and financial c

307、ondition.Flat-Rolled Products Segment Our Flat-Rolled Products segment produces,converts and distributes stainless steel,nickel-based alloys and superalloys,titanium and titanium-based alloys and specialty alloys in a variety of product forms,including plate,sheet,engineered strip,and Precision Roll

308、ed Strip products,as well as grain-oriented electrical steel sheet.The major end markets for our flat-rolled products are oil and gas,chemical process industry,electrical energy,automotive,food equipment and appliances,construction and mining,aerospace and 5991_FIN.pdf 5F6 defense,and electronics,co

309、mmunication equipment and computers.The operations in this segment are ATI Allegheny Ludlum,the Chinese joint venture company known as Shanghai STAL Precision Stainless Steel Company Limited(STAL),in which we hold a 60%interest,and our 50%interest in the industrial titanium joint venture known as Un

310、iti LLC.The remaining 40%interest in STAL is owned by the Baosteel Group,a state authorized investment company whose equity securities are publicly traded in the Peoples Republic of China.The remaining 50%interest in Uniti LLC is held by Verkhnaya Salda Metallurgical Production Association(VSMPO),a

311、Russian producer of titanium,aluminum,and specialty steel products.Stainless steel,nickel-based alloys and titanium sheet products are used in a wide variety of industrial and consumer applications.In 2011,approximately 50%by volume of our stainless sheet products were sold to independent service ce

312、nters,which have slitting,cutting or other processing facilities,with the remainder sold directly to end-use customers.Engineered strip and very thin Precision Rolled Strip products are used by customers to fabricate a variety of products primarily in the automotive,construction,and electronics mark

313、ets.In 2011,approximately 90%by volume of our engineered strip and Precision Rolled Strip products were sold directly to end-use customers or through our own distribution network,with the remainder sold to independent service centers.Stainless steel,nickel-based alloy and titanium plate products are

314、 primarily used in industrial markets.In 2011,approximately 50%by volume of our plate products were sold to independent service centers,with the remainder sold directly to end-use customers.Grain-oriented electrical steel is used in power transformers where electrical conductivity and magnetic prope

315、rties are important.Nearly all of our grain-oriented electrical steel products are sold directly to end-use customers.Engineered Products Segment The principal business of our Engineered Products segment includes the production of tungsten powder,tungsten heavy alloys,tungsten carbide materials,and

316、tungsten carbide cutting tools.We are integrated from the raw materials(ammonium paratungstate(APT)to the manufacture of our tungsten-based products.The segment also produces carbon alloy steel impression die forgings,and large grey and ductile iron castings,and provides precision metals processing

317、services.The operating units in this segment are ATI Tungsten Materials,ATI Portland Forge,ATI Casting Service and ATI Precision Finishing.We produce a line of sintered tungsten carbide products that approach diamond hardness for industrial markets including automotive,oil and gas,chemical process i

318、ndustry,machine and cutting tools,aerospace,construction and mining,and other markets requiring tools with extra hardness.Technical developments related to ceramics,coatings and other disciplines are incorporated in these products.We also produce tungsten and tungsten carbide powders.We forge carbon

319、 alloy steels into finished forms that are used primarily in the transportation and construction equipment markets.We also cast grey and ductile iron metals used in the transportation,wind power generation and automotive markets.We have precision metals processing capabilities that enable us to prov

320、ide process services for most high-value metals from ingots to finished product forms.Such services include grinding,polishing,blasting,cutting,flattening,and ultrasonic testing.Competition Markets for our products and services in each of our three business segments are highly competitive.We compete

321、 with many producers and distributors who,depending on the product involved,range from large diversified enterprises to smaller companies specializing in particular products.Factors that affect our competitive position are the quality of our products,services and delivery capabilities,our capabiliti

322、es to produce a wide range of specialty materials in various alloys and product forms,our technological capabilities including our research and development efforts,our marketing strategies,the prices for our products and services,our manufacturing costs,and industry manufacturing capacity.We face co

323、mpetition from both domestic and foreign companies.Some of our foreign competitors are either directly or indirectly government subsidized.In 1999,the United States imposed antidumping and countervailing duties on dumped and subsidized imports of stainless steel sheet and strip in coils and stainles

324、s steel plate in coils from companies in ten foreign countries.The antidumping and countervailing duty orders were reviewed in 2011 by the U.S.Department of Commerce and the U.S.International Trade Commission to determine whether the orders should remain in place for another five years.The agencies

325、decided that nine such orders against five countries will continue in effect.We continue to monitor unfairly traded imports from foreign producers for appropriate action.5991_FIN.pdf 6F7 Major Competitors Nickel-based alloys and superalloys and specialty steel alloys Carpenter Technology Corporation

326、:A Special Metals Corporation,a Precision Castparts Cpany:C Haynes International,Inc.:B Inoxum(part of ThyssenKrupp AG)(Germany):C Titanium and titanium-based alloys Titanium Metals Corporation:C RMI Titanium,an RTI International Metals Company:C VSMPO-AVISMA(Russia):A Precision forgings and titaniu

327、m investment castings Precision Castparts Corp.:A Firth Rixson Limited(United Kingdom):A Aubert&Duval,a group member of Eramet(France):A Exotic alloys Cezus,a group member of AREVA(France):A HC Stark:A Western Zirconium Plant of Westinghouse Electric Company,owned by Toshiba Corporation:A Stainless

328、steel AK Steel Corporation:B North American Stainless(NAS),owned by Acerinox S.A.(Spain):B Inoxum(part of ThyssenKrupp AG)USA:B Outokumpu Stainless Plate Products,owned by Outokumpu Oyj(Finland):B Imports from-Aperam(formerly part of Arcelor Mittal)(France,Belgium and Germany):B -Inoxum(part of Thys

329、senKrupp AG(Germany)including Mexinox S.A.de C.V.,group member(Mexico):B -Ta Chen International Corporation(Taiwan):B -Various Chinese producers:B Tungsten and tungsten carbide products Kennametal Inc.:D Iscar(Israel):D Sandvik AB(Sweden):D Seco Tools AB(Sweden),owned by Sandvik AB:D KEY A=Primarily

330、 High Performance Metals segment,B=Primarily Flat-Rolled Products segment,C=Both High Performance Metals and Flat-Rolled Products segments,D=Primarily Engineered Products segment Raw Materials and Supplies Substantially all raw materials and supplies required in the manufacture of our products are a

331、vailable from more than one supplier and the sources and availability of raw materials essential to our businesses are currently adequate.The principal raw materials we use in the production of our specialty metals are scrap(including iron-,nickel-,chromium-,titanium-,molybdenum-,and tungsten-bearin

332、g scrap),nickel,titanium sponge,zirconium sand and sponge,ferrochromium,ferrosilicon,molybdenum and molybdenum alloys,manganese and manganese alloys,cobalt,niobium,vanadium and other alloying materials.Purchase prices of certain principal raw materials have been volatile.As a result,our operating re

333、sults may be subject to significant fluctuation.We use raw materials surcharge and index mechanisms to offset the impact of increased raw material costs;however,competitive factors in the marketplace may limit our ability to institute such mechanisms,and there can be a delay between the increase in the price of raw materials and the realization of the benefit of such mechanisms.For example,in 2011