##### Table of Contents





UNITED STATES
 SECURITIES AND EXCHANGE
    COMMISSION
 WASHINGTON, D.C.
    20549
  FORM 10-Q
  (Mark One)
  þ
    QUARTERLY REPORT PURSUANT TO
    SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934  FOR THE QUARTERLY PERIOD ENDED
    JUNE 30, 2010
  OR
  o
    TRANSITION REPORT PURSUANT TO
    SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934  For the transition period
    from 
    to
  Commission File Number:
    001-14437
   RTI INTERNATIONAL METALS,
    INC.
 (Exact name of registrant as
    specified in its charter)
   Ohio

52-2115953(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)Westpointe Corporate Center One,
    5th

    Floor
    1550 Coraopolis Heights Road
    Pittsburgh, Pennsylvania

15108-2973(Zip Code)(Address of principal executive offices)    Registrants telephone number,
    including area code:
 (412) 893-0026
    Yes þ     No o
   Regulation S-T
 Yes o     No o
   Rule 12b-2
  Large accelerated filer o

Accelerated filer þ

Non-accelerated filero

Smaller reporting company o(Do not check if a smaller
    reporting company)    Rule 12b-2
 Yes o     
    No þ




---



##### 





RTI
    INTERNATIONAL METALS, INC AND CONSOLIDATED
    SUBSIDIARIES
      INDEX
  
  PagePART I  FINANCIAL
    INFORMATIONItem 1.

Financial Statements


1Condensed Consolidated Statements of Operations
    (Unaudited) for the Three and Six Months Ended June 30,
    2010 and 2009


1Condensed Consolidated Balance Sheets (Unaudited)
    as of June 30, 2010 and December 31, 2009


2Condensed Consolidated Statements of Cash Flows
    (Unaudited) for the Six Months Ended June 30, 2010 and
    2009


3Condensed Consolidated Statement of Comprehensive
    Income and Shareholders Equity (Unaudited) for the Six
    Months Ended June 30, 2010


4Condensed Notes to Consolidated Financial
    Statements


5Item 2.

Managements Discussion and Analysis of
    Financial Condition and Results of Operations


19Item 3.

Quantitative and Qualitative Disclosures About
    Market Risk


29Item 4.

Controls and Procedures


30PART II  OTHER
    INFORMATIONItem 1A.

Risk Factors


31Item 2.

Unregistered Sales of Equity Securities and Use
    of Proceeds


31Item 6.

Exhibits


31Signatures


32EX-31.1EX-31.2EX-32.1EX-32.2




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##### Table of Contents



PART I 
    FINANCIAL INFORMATION  Item 1.
    Financial
    Statements.  RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIESCondensed Consolidated Statements
    of Operations
    (Unaudited) 
    (In thousands, except share and per share amounts)
  Three Months Ended


Six Months EndedJune 30,


June 30,2010


2009


2010


2009Net sales

$
106,651


$
104,354


$
214,536


$
210,408Cost and expenses:Cost of sales


89,702



90,859



170,064



180,621Selling, general, and administrative expenses


16,418



14,595



32,057



31,142Research, technical, and product development expenses


1,028



503



1,753



1,027Asset and asset-related charges (income)


(2,590
)






(3,111
)


Operating income (loss)


2,093



(1,603
)


13,773



(2,382
)Other income


233



855



366



1,754Interest income


133



427



231



1,068Interest expense


(291
)


(2,355
)


(564
)


(4,776
)Income (loss) before income taxes


2,168



(2,676
)


13,806



(4,336
)Benefit from income taxes


(8,071
)


(2,801
)


(7,831
)


(3,002
)Net Income (loss)

$
10,239


$
125


$
21,637


$
(1,334
)Earnings (loss) per share:Basic

$
0.34


$
0.01


$
0.72


$
(0.06
)Diluted

$
0.34


$
0.01


$
0.72


$
(0.06
)Weighted-average shares outstanding:Basic


29,903,061



22,898,490



29,885,280



22,887,743Diluted


30,100,762



22,971,124



30,117,232



22,887,743   The accompanying notes are an integral part of these
    Consolidated Financial Statements.
 1




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Condensed
    Consolidated Balance Sheets
 (Unaudited)
  (In thousands, except share and per share amounts)
  June 30,


December 31,2010


2009ASSETSCurrent assets:Cash and cash equivalents

$
104,327


$
56,216Short-term investments


20,152



65,042Receivables, less allowance for doubtful accounts of $670 and
    $646


62,624



60,924Inventories, net


269,333



266,887Deferred income taxes


21,324



21,237Other current assets


21,845



21,410Total current assets


499,605



491,716Property, plant, and equipment, net


252,535



252,301Goodwill


41,068



41,068Other intangible assets, net


13,814



14,299Deferred income taxes


54,975



53,814Other noncurrent assets


1,196



1,537Total assets

$
863,193


$
854,735LIABILITIES AND SHAREHOLDERS EQUITYCurrent liabilities:Accounts payable

$
36,230


$
39,193Accrued wages and other employee costs


14,003



9,796Unearned revenues


15,434



21,832Current liability for post-retirement benefits


2,476



2,476Current liability for pension benefits


140



140Other accrued liabilities


19,281



30,518Total current liabilities


87,564



103,955Long-term debt


71



81Noncurrent liability for post-retirement benefits


35,084



34,530Noncurrent liability for pension benefits


28,805



28,102Deferred income taxes






244Other noncurrent liabilities


7,476



8,617Total liabilities


159,000



175,529Commitments and ContingenciesShareholders equity:Common stock, $0.01 par value; 50,000,000 shares
    authorized; 30,804,117 and 30,724,351 shares issued;
    30,079,436 and 30,010,998 shares outstanding


308



307Additional paid-in capital


441,672



439,361Treasury stock, at cost; 724,681 and 713,353 shares


(17,281
)


(16,996
)Accumulated other comprehensive loss


(32,240
)


(33,563
)Retained earnings


311,734



290,097Total shareholders equity


704,193



679,206Total liabilities and shareholders equity

$
863,193


$
854,735   The accompanying notes are an integral part of these
    Consolidated Financial Statements.
 2




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Condensed
    Consolidated Statements of Cash Flows
 (Unaudited)
  (In thousands)
  Six Months EndedJune 30,2010


2009OPERATING ACTIVITIES:Net income (loss)

$
21,637


$
(1,334
)Adjustment for non-cash items included in net income:Depreciation and amortization


10,978



10,762Asset and asset-related charges (income)


(2,081
)


Deferred income taxes


(1,521
)


(3,862
)Stock-based compensation


2,086



2,466Excess tax benefits from stock-based compensation activity


(189
)


(437
)Gain on sale of property, plant and equipment


(272
)


Other


432



41Changes in assets and liabilities:Receivables


(2,224
)


24,408Inventories


(4,367
)


(2,837
)Accounts payable


(3,997
)


3,557Income taxes payable


181



(683
)Unearned revenue


(1,824
)


(807
)Other current assets and liabilities


(4,256
)


(13,818
)Other assets and liabilities


1,704



1,524Cash provided by operating activities


16,287



18,980INVESTING ACTIVITIES:Proceeds from disposal of property, plant, and equipment


468



Purchase of short-term investments


(111
)


(40,000
)Sale of short-term investments


45,000



Capital expenditures


(13,565
)


(45,167
)Cash provided by (used in) investing activities


31,792



(85,167
)FINANCING ACTIVITIES:Proceeds from exercise of employee stock options


252



27Excess tax benefits from stock-based compensation activity


189



437Borrowings on long-term debt






1,181Repayments on long-term debt


(10
)


(686
)Purchase of common stock held in treasury


(286
)


(88
)Cash provided by financing activities


145



871Effect of exchange rate changes on cash and cash equivalents


(113
)


1,936Increase (decrease) in cash and cash equivalents


48,111



(63,380
)Cash and cash equivalents at beginning of period


56,216



284,449Cash and cash equivalents at end of period

$
104,327


$
221,069   The accompanying notes are an integral part of these
    Consolidated Financial Statements.
 3




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Condensed
    Consolidated Statement of Comprehensive Income and
    Shareholders Equity
 (Unaudited)
  (In thousands, except share amounts)
  Accumulated OtherComprehensive Income(Loss)Net Unrealized Gain(Loss) FromCommon Stock


Additional








Available


Minimum


ForeignShares





Paid-In


Treasury


Retained


For Sale


Pension


CurrencyOutstanding


Amount


Capital


Stock


Earnings


Investments


Liability


Translation


TotalBalance at December 31, 2009


30,010,998


$
307


$
439,361


$
(16,996
)

$
290,097


$
42


$
(39,932
)

$
6,327


$
679,206Net Income


















21,637















21,637Foreign currency translation






























(74
)


(74
)Unrecognized loss on investments






















(15
)










(15
)Benefit plan amortization


























1,412







1,412Comprehensive income


































22,960Shares issued for directors compensation


16,763































Shares issued for restricted stock award plans


49,770



1



























1Stock-based compensation expense recognized










2,086























2,086Treasury stock purchased at cost


(11,328
)










(285
)


















(285
)Exercise of employee options


10,767







252























252Forefeiture of restricted stock awards


































Tax benefits from stock-based compensation activity










(91
)






















(91
)Shares issued for employee stock purchase plan


2,466







64























64Balance at June 30, 2010


30,079,436


$
308


$
441,672


$
(17,281
)

$
311,734


$
27


$
(38,520
)

$
6,253


$
704,193   The accompanying notes are an integral part of these
    Consolidated Financial Statements.
  4




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Condensed
    Notes to Consolidated Financial Statements
 (Unaudited)
  (In thousands, except share and per share amounts, unless
    otherwise indicated)
  Note 1
    BASIS OF
    PRESENTATION:  Form 10-Q Regulation S-X.
  Form 10-K.
  Note 2
    ORGANIZATION:        sub-assemblies,
 5




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Condensed
    Notes to Consolidated Financial Statements
 (Unaudited)
  (In thousands, except share and per share amounts, unless
    otherwise indicated)
  cuts-to-size, just-in-time
    Note 3
    ASSET AND
    ASSET-RELATED CHARGES (INCOME):        Sponge-PlantContractualCommitmentsBalance as of December 31, 2009

$
7,809Settlements/adjustments


(4,474
)Payments


(1,402
)Balance as of June 30, 2010

$
1,933  6




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Condensed
    Notes to Consolidated Financial Statements
 (Unaudited)
  (In thousands, except share and per share amounts, unless
    otherwise indicated)
   Note 4
    STOCK-BASED
    COMPENSATION:  Stock
    Options
    Stock Options

OptionsOutstanding at December 31, 2009


475,581Granted


99,580Forfeited


(767
)Expired


(133
)Exercised


(10,767
)Outstanding at June 30, 2010


563,494Exercisable at June 30, 2010


345,376     2010Risk-free interest rate


2.34
%Expected dividend yield


0.00
%Expected lives (in years)


4.0Expected volatility


66.00
%     Restricted
    Stock
    Nonvested Restricted Stock Awards

SharesNonvested at December 31, 2009


171,387Granted


66,533Vested


(73,331
)Nonvested at June 30, 2010


164,589    7




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Condensed
    Notes to Consolidated Financial Statements
 (Unaudited)
  (In thousands, except share and per share amounts, unless
    otherwise indicated)
  Performance
    Share Awards
    Awards


Maximum SharesPerformance Share Awards

Activity


Eligible to ReceiveOutstanding at December 31, 2009


73,380



146,760Granted


49,450



98,900Forfeited


(1,300
)


(2,600
)Outstanding at June 30, 2010


121,530



243,060     Note 5
    INCOME
    TAXES:      year-to-date
 8




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Condensed
    Notes to Consolidated Financial Statements
 (Unaudited)
  (In thousands, except share and per share amounts, unless
    otherwise indicated)
   Note 6
    EARNINGS
    PER SHARE:      Three Months Ended


Six Months EndedJune 30,


June 30,2010


2009


2010


2009Numerator:Net income (loss)

$
10,239


$
125


$
21,637


$
(1,334
)Denominator:Basic weighted-average shares outstanding


29,903,061



22,898,490



29,885,280



22,887,743Effect of diluted securities


197,701



72,634



231,952



Diluted weighted-average shares outstanding


30,100,762



22,971,124



30,117,232



22,887,743Earnings (loss) per share:Basic

$
0.34


$
0.01


$
0.72


$
(0.06
)Diluted

$
0.34


$
0.01


$
0.72


$
(0.06
)     Note 7
    RECEIVABLES:    June 30,


December 31,2010


2009Trade and commercial customers

$
63,294


$
61,570Less: Allowance for doubtful accounts


(670
)


(646
)Total receivables

$
62,624


$
60,924  9




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Condensed
    Notes to Consolidated Financial Statements
 (Unaudited)
  (In thousands, except share and per share amounts, unless
    otherwise indicated)
   Note 8
    INVENTORIES:  last-in, first-in, lower-of-cost-or-market
  June 30,


December 31,2010


2009Raw materials and supplies

$
139,369


$
145,062Work-in-process
    and finished goods


194,285



197,840LIFO reserve


(64,321
)


(76,015
)Total inventories

$
269,333


$
(266,887
)     Note 9
    GOODWILL
    AND OTHER INTANGIBLE ASSETS:    ®
  Goodwill.
  Titanium


Fabrication


DistributionGroup


Group


Group


TotalBalance at December 31, 2009 and June 30, 2010:Goodwill

$
2,548


$
37,386


$
9,833


$
49,767Accumulated impairment loss






(8,699
)






(8,699
)Net goodwill

$
2,548


$
28,687


$
9,833


$
41,068   Intangibles.
 10




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Condensed
    Notes to Consolidated Financial Statements
 (Unaudited)
  (In thousands, except share and per share amounts, unless
    otherwise indicated)
    December 31,





Translation


June 30,2009


Amortization


Adjustment


2010Fabrication Group

$
14,299


$
(491
)

$
6


$
13,814   Note
    10UNEARNED REVENUE:
    Note 11
    OTHER
    INCOME:    Note 12
    EMPLOYEE
    BENEFIT PLANS:    Pension Benefits


Other Post-Retirement BenefitsThree Months


Six Months


Three Months


Six MonthsEnded


Ended


Ended


EndedJune 30,


June 30,


June 30,


June 30,2010


2009


2010


2009


2010


2009


2010


2009Service cost

$
451


$
398


$
902


$
796


$
178


$
128


$
356


$
256Interest cost


1,770



1,761



3,540



3,523



550



534



1,100



1,069Expected return on plan assets


(1,869
)


(1,930
)


(3,738
)


(3,859
)














Amortization of prior service cost


131



209



262



418



304



304



607



607Amortization of unrealized gains


701



480



1,402



960















Net periodic benefit cost

$
1,184


$
918


$
2,368


$
1,838


$
1,032


$
966


$
2,063


$
1,932   Note 13
    COMMITMENTS
    AND CONTINGENCIES:   11




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Condensed
    Notes to Consolidated Financial Statements
 (Unaudited)
  (In thousands, except share and per share amounts, unless
    otherwise indicated)
  Tronox
    LLC Litigation
  and/or
  Environmental
    Matters
          Duty
    Drawback Investigation
   12




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Condensed
    Notes to Consolidated Financial Statements
 (Unaudited)
  (In thousands, except share and per share amounts, unless
    otherwise indicated)
        write-off
       13




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Condensed
    Notes to Consolidated Financial Statements
 (Unaudited)
  (In thousands, except share and per share amounts, unless
    otherwise indicated)
  Other
    Matters
    Note 14
    SEGMENT
    REPORTING:        cuts-to-size, just-in-time
   14




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Condensed
    Notes to Consolidated Financial Statements
 (Unaudited)
  (In thousands, except share and per share amounts, unless
    otherwise indicated)
    Three Months Ended


Six Months EndedJune 30,


June 30,2010


2009


2010


2009Net sales:Titanium Group

$
30,556


$
27,124


$
69,397


$
57,427Intersegment sales


23,291



35,278



47,056



69,029Total Titanium Group net sales


53,847



62,402



116,453



126,456Fabrication Group


37,295



26,487



65,897



52,551Intersegment sales


14,669



14,210



27,431



28,575Total Fabrication Group net sales


51,964



40,697



93,328



81,126Distribution Group


38,800



50,743



79,242



100,430Intersegment sales


817



588



1,281



1,265Total Distribution Group net sales


39,617



51,331



80,523



101,695Eliminations


38,777



50,076



75,768



98,869Total consolidated net sales

$
106,651


$
104,354


$
214,536


$
210,408Operating income (loss):Titanium Group before corporate allocations

$
3,854


$
4,496


$
20,937


$
11,475Corporate allocations


(2,022
)


(2,386
)


(4,113
)


(5,144
)Total Titanium Group operating income


1,832



2,110



16,824



6,331Fabrication Group before corporate allocations


1,952



(4,213
)


(478
)


(8,865
)Corporate allocations


(2,743
)


(2,222
)


(5,579
)


(4,791
)Total Fabrication Group operating loss


(791
)


(6,435
)


(6,057
)


(13,656
)Distribution Group before corporate allocations


2,617



4,488



6,187



8,752Corporate allocations


(1,565
)


(1,766
)


(3,181
)


(3,809
)Total Distribution Group operating income


1,052



2,722



3,006



4,943Total consolidated operating income (loss)

$
2,093


$
(1,603
)

$
13,773


$
(2,382
)   June 30,


December 31,2010


2009Total assets:Titanium Group

$
369,150


$
365,725Fabrication Group


245,849



239,847Distribution Group


128,482



140,666General corporate assets


119,712



108,497Total consolidated assets

$
863,193


$
854,735  15




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Condensed
    Notes to Consolidated Financial Statements
 (Unaudited)
  (In thousands, except share and per share amounts, unless
    otherwise indicated)
   Note 15
    FINANCIAL
    INSTRUMENTS:        Statement ofDesignated as

Financial Position

Asset (Liability)Hedging Instrument

Location

Fair ValueForeign currency forward contracts


No



Other current liabilities


$
(53
)     Note 16
    FAIR
    VALUE MEASUREMENTS:       16




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Condensed
    Notes to Consolidated Financial Statements
 (Unaudited)
  (In thousands, except share and per share amounts, unless
    otherwise indicated)
    Significant


SignificantQuoted Market


Other Observable


UnobservablePrices


Inputs


Inputs(Level 1)


(Level 2)


(Level 3)


TotalCash and cash equivalents

$
104,327


$



$



$
104,327Short-term investments


20,152











20,152Total assets

$
124,479


$



$



$
124,479Foreign currency forward contracts






53







53Total liabilities

$



$
53


$



$
53       Total


TotalSignificant





Charges for


Charges forQuoted


Other


Significant


Three Months


Six MonthsNet Carrying


Market


Observable


Unobservable


Ended


EndedValue as of


Prices


Inputs


Inputs


June 30,


June 30,June 30, 2010


(Level 1)


(Level 2)


(Level 3)


2010


2010Sponge plant construction-related assets

$
2,433


$



$



$
2,433


$
(1,901
)

$
(1,901
)     Note 17
    CREDIT
    AGREEMENT:    Note 18
    NEW
    ACCOUNTING STANDARDS:   17




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Condensed
    Notes to Consolidated Financial Statements
 (Unaudited)
  (In thousands, except share and per share amounts, unless
    otherwise indicated)
      Note 19
    SUBSEQUENT
    EVENTS:   18




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##### Table of Contents



Item 2.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations.  Forward-Looking
    Statements
    
    the future availability and prices of raw materials,
    competition in the titanium industry,
    demand for the Companys products,
    the historic cyclicality of the titanium and commercial
    aerospace industries,
    changes in defense spending and cancellation or changes in
    defense programs or initiatives,
    changes in the Joint Strike Fighter production schedule,
    the success of new market development,
    the ability to obtain access to financial markets and to
    maintain current covenant requirements,
    long-term supply agreements and the impact if another party
    fails to fulfill their requirements under existing contracts or
    successfully manage its future development and production
    schedule,
    the impact of the current titanium inventory overhang throughout
    the Companys supply chain,
    the impact of Boeing 787
    Dreamliner®

    production delays,
    our ability to attract and retain key personnel,
    legislative challenges to the Specialty Metals Clause of the
    Berry Amendment,
    labor matters,
    global economic activities,
    the outcome of the U.S. Customs investigation,
    the successful completion of our expansion projects,
    our ability to execute on new business awards,
    our order backlog and the conversion of that backlog into
    revenue, and
    other statements contained herein that are not historical facts.    Overview
     19




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##### Table of Contents



sub-assemblies,
  cuts-to-size, just-in-time
    Trends
    and Uncertainties
       20




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##### Table of Contents



Three
    Months Ended June 30, 2010 Compared To Three Months Ended
    June 30, 2009
  Net Sales.
  Three MonthsEndedJune 30,


$ Increase/


% Increase/(In millions except percents)

2010


2009


(Decrease)


(Decrease)Titanium Group

$
30.6


$
27.1


$
3.5



12.9
%Fabrication Group


37.3



26.5



10.8



40.8
%Distribution Group


38.8



50.8



(12.0
)


(23.6
)%Total consolidated net sales

$
106.7


$
104.4


$
2.3



2.2
%     ®
    Gross Profit (Loss).
  Three MonthsEndedJune 30,


$ Increase/


% Increase/(In millions except percents)

2010


2009


(Decrease)


(Decrease)Titanium Group

$
3.9


$
6.8


$
(2.9
)


(42.6
)%Fabrication Group


6.6



(1.3
)


7.9



607.7
%Distribution Group


6.4



8.0



(1.6
)


(20.0
)%Total consolidated gross profit

$
16.9


$
13.5


$
3.4



25.2
%    21




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##### Table of Contents



Selling, General, and Administrative
    Expenses.
  Three MonthsEndedJune 30,


$ Increase/


% Increase/(In millions except percents)

2010


2009


(Decrease)


(Decrease)Titanium Group

$
3.6


$
4.2


$
(0.6
)


(14.3
)%Fabrication Group


7.4



5.1



2.3



45.1
%Distribution Group


5.4



5.3



0.1



1.9
%Total consolidated SG&A expenses

$
16.4


$
14.6


$
1.8



12.3
%     Research, Technical, and Product Development
    Expenses.
  Asset and Asset-Related Charges
    (Income).
  Operating Income (Loss).
  Three MonthsEndedJune 30,


$ Increase/


% Increase/(In millions except percents)

2010


2009


(Decrease)


(Decrease)Titanium Group

$
1.8


$
2.1


$
(0.3
)


(14.3
)%Fabrication Group


(0.8
)


(6.4
)


5.6



87.5
%Distribution Group


1.1



2.7



(1.6
)


(59.3
)%Total operating income (loss)

$
2.1


$
(1.6
)

$
3.7



231.3
%      22




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®
    Other Income.
  Interest Income and Interest Expense.
  Provision for (Benefit from) Income Taxes.
  year-to-date
   Six
    Months Ended June 30, 2010 Compared To Six Months Ended
    June 30, 2009
  Net Sales.
  Six MonthsEndedJune 30,


$ Increase/


% Increase/(In millions except percents)

2010


2009


(Decrease)


(Decrease)Titanium Group

$
69.4


$
57.4


$
12.0



20.9
%Fabrication Group


65.9



52.6



13.3



25.3
%Distribution Group


79.2



100.4



(21.2
)


(21.1
)%Total consolidated net sales

$
214.5


$
210.4


$
4.1



1.9
%    23




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##### Table of Contents



® ® ®
    Gross Profit (Loss).
  Six MonthsEndedJune 30,


$ Increase/


% Increase/(In millions except percents)

2010


2009


(Decrease)


(Decrease)Titanium Group

$
22.9


$
16.2


$
6.7



41.4
%Fabrication Group


8.3



(2.6
)


10.9



419.2
%Distribution Group


13.3



16.2



(2.9
)


(17.9
)%Total consolidated gross profit

$
44.5


$
29.8


$
14.7



49.3
%     ®
   24




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##### Table of Contents



Selling, General, and Administrative
    Expenses.
  Six MonthsEndedJune 30,


$ Increase/


% Increase/(In millions except percents)

2010


2009


(Decrease)


(Decrease)Titanium Group

$
7.4


$
8.8


$
(1.4
)


(15.9
)%Fabrication Group


14.3



11.0



3.3



30.0
%Distribution Group


10.4



11.3



(0.9
)


(8.0
)%Total consolidated SG&A expenses

$
32.1


$
31.1


$
1.0



3.2
%     Research, Technical, and Product Development
    Expenses.
  Asset and Asset-Related Charges
    (Income).
  Operating Income (Loss).
  Six MonthsEndedJune 30,


$ Increase/


% Increase/(In millions except percents)

2010


2009


(Decrease)


(Decrease)Titanium Group

$
16.8


$
6.3


$
10.5



166.7
%Fabrication Group


(6.1
)


(13.6
)


7.5



55.1
%Distribution Group


3.1



4.9



(1.8
)


(36.7
)%Total operating income (loss)

$
13.8


$
(2.4
)

$
16.2



675.0
%     ®
   25




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##### Table of Contents



Other Income.
  Interest Income and Interest Expense.
  Provision for (Benefit from) Income Taxes.
  year-to-date
   Liquidity
    and Capital Resources
     26




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##### Table of Contents




    Our leverage ratio (the ratio of Net Debt to Consolidated
    EBITDA, as defined in the Credit Agreement) was (2.7) at
    June 30, 2010. If this ratio were to exceed 3.25 to 1, we
    would be in default under our Credit Agreement and our ability
    to borrow under our Credit Agreement would be impaired.
    Our interest coverage ratio (the ratio of Consolidated EBITDA to
    Net Interest, as defined in the Credit Agreement) was 167.1 at
    June 30, 2010. If this ratio were to fall below 2.0 to 1,
    we would be in default under our Credit Agreement and our
    ability to borrow under our Credit Agreement would be impaired.    ®
    Cash provided by operating activities.
  Cash provided by (used in) investing
    activities.
  Cash provided by financing activities.
   Duty
    Drawback Investigation
     27




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##### Table of Contents



Backlog
  ®
 28




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##### Table of Contents



Environmental
    Matters
           New
    Accounting Standards
       Item 3.
    Quantitative
    and Qualitative Disclosures about Market Risk.  Form 10-K
 29




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##### Table of Contents



Item 4.
    Controls
    and Procedures.     30




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##### Table of Contents



PART II 
    OTHER INFORMATION   Item 1A.
    Risk
    Factors.  Form 10-K
   Item 2.
    Unregistered
    Sales of Equity Securities and Use of Proceeds.       Item 6.
    Exhibits.   31




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##### Table of Contents



SIGNATURES      By
    /s/  William
    T. Hull    Senior Vice President and Chief Financial Officer
 (principal accounting officer)
   32




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##### Table of Contents



INDEX TO
    EXHIBITS
  ExhibitNo.

Description10
.1*

Employment agreement, dated May 17, 2010, between the
    Company and James L. McCarley, incorporated by reference to
    Exhibit 10.1 to the Companys Current Report on
    Form 8-K/A
    for the event dated May 17, 2010.10
.2*

Form of indemnification agreement, incorporated by reference to
    Exhibit 10.2 to the Companys Current Report on
    Form 8-K/A
    for the event dated May 17, 2010.31
.1

Certification of Chief Executive Officer required by
    Item 307 of
    Regulation S-K
    as promulgated by the Securities and Exchange Commission and
    pursuant to Section 302 of Sarbanes-Oxley Act of 2002,
    filed herewith.31
.2

Certification of Principal Financial Officer required by
    Item 307 of
    Regulation S-K
    as promulgated by the Securities and Exchange Commission and
    pursuant to Section 302 of Sarbanes-Oxley Act of 2002,
    filed herewith.32
.1

Certification of Chief Executive Officer Pursuant to
    18 U.S.C. Section 1350, as Adopted Pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2002, filed
    herewith.32
.2

Certification of Principal Financial Officer Pursuant to
    18 U.S.C. Section 1350, as Adopted Pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2002, filed
    herewith.     *
    
    Denotes management contract or compensatory plan, contract or
    arrangement. 33