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Allegheny Technologies Announces Actions to Improve Future Financial Performance

PITTSBURGH--(BUSINESS WIRE)--Allegheny Technologies Incorporated (NYSE:ATI) today announced several actions to improve the Company’s future financial performance, which include the indefinite idling of the Rowley, UT titanium sponge production facility and consolidating certain titanium manufacturing operations in Albany, OR.

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These actions are expected to improve ATI’s annual operating income by approximately $50 million beginning in 2017. In addition, these actions are expected to generate approximately $50 million of cash flow from lower managed working capital as titanium sponge inventory is reduced over the next several quarters.

As a result of these actions, ATI expects to record total pre-tax, non-cash impairment charges of approximately $470 million for idled facilities ($317 million after tax, or $2.96 per share), and pre-tax shutdown and idling costs of approximately $34 million ($23 million after tax, or $0.22 per share). As a result of these charges, in accordance with accounting requirements, ATI will also record approximately $183 million, or $1.71 per share, in non-cash income tax valuation allowances related to U.S. federal tax benefits. The total charges, including the tax valuation allowance, are expected to be $4.89 per share, of which $4.83 per share is expected to be recognized in the third quarter 2016 and the remainder in the fourth quarter 2016.

“We are focused and committed to return ATI to sustainable profitable growth and improve cash flow”, said Rich Harshman, ATI’s Chairman, President and Chief...