##### Table of Contents



UNITED STATES
 SECURITIES AND EXCHANGE
    COMMISSION
 WASHINGTON, D.C. 20549
  FORM 10-Q
   þ
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934  FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2009
   o
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934  
  001-14437
  RTI INTERNATIONAL METALS,
    INC.
 (Exact name of registrant as
    specified in its charter)
  Ohio(State or other jurisdiction of
    incorporation or organization)

52-2115953(I.R.S. Employer
    Identification No.)Westpointe Corporate Center One,
    5th Floor

    1550 Coraopolis Heights Road
    Pittsburgh, Pennsylvania(Address of principal executive offices)

15108-2973(Zip Code)   (412) 893-0026
 Registrants telephone number,
    including area code:
   Yes þ     No o
   Yes o     No o
  Rule 12b-2
  Large
    accelerated
    filer þ
    Accelerated
    filer o
    Non-accelerated
    filer o
    Smaller
    reporting
    company o   Rule 12b-2
 Yes o     No þ




---



##### 



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


Financial Statements


2Condensed Consolidated Statements of Operations (Unaudited) for the Three Months Ended March 31, 2009 and 2008


2Condensed Consolidated Balance Sheets (Unaudited) as of March 31, 2009 and December 31, 2008


3Condensed Consolidated Statements of Cash Flows (Unaudited) for the Three Months Ended March 31, 2009 and 2008


4Condensed Consolidated Statement of Comprehensive Income and Shareholders Equity (Unaudited) for the Three Months Ended March 31, 2009


5Condensed Notes to Consolidated Financial Statements


6Item 2.


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


19Item 3.


Quantitative and Qualitative Disclosures About Market Risk


26Item 4.


Controls and Procedures


26PART II  OTHER INFORMATIONItem 1A.


Risk Factors


27Item 2.


Unregistered Sales of Equity Securities and Use of Proceeds


27Item 6.


Exhibits


27Signatures


28EX-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 SUBSIDIARIES
  Condensed
    Consolidated Statements of Operations

(Unaudited)





(In
    thousands, except share and per share amounts) Three Months EndedMarch 31,2009


2008Net sales

$
106,054


$
150,648Cost and expenses:Cost of sales


89,762



98,590Selling, general, and administrative expenses


16,547



18,308Research, technical, and product development expenses


524



524Operating income (loss)


(779
)


33,226Other income


899



295Interest income


641



903Interest expense


(2,421
)


(350
)Income (loss) before income taxes


(1,660
)


34,074Provision for (benefit from) income taxes


(201
)


11,837Net Income (loss)

$
(1,459
)

$
22,237Earnings per share:Basic

$
(0.06
)

$
0.97Diluted

$
(0.06
)

$
0.96Weighted-average shares outstanding:Basic


22,877,409



22,946,511Diluted


22,877,409



23,186,958   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 Balance Sheets(Unaudited)





(In thousands, except share and per share amounts) March 31,


December 31,2009


2008ASSETSCurrent assets:Cash and cash equivalents

$
262,844


$
284,449Receivables, less allowance for doubtful accounts of $510 and
    $2,260


66,617



79,778Inventories, net


281,425



274,330Deferred income taxes


29,326



29,456Other current assets


13,391



11,109Total current assets


653,603



679,122Property, plant, and equipment, net


280,086



271,062Goodwill


47,617



47,984Other intangible assets, net


12,567



13,196Deferred income taxes


17,687



15,740Other noncurrent assets


2,003



2,099Total assets

$
1,013,563


$
1,029,203LIABILITIES AND SHAREHOLDERS EQUITYCurrent liabilities:Accounts payable

$
47,313


$
54,422Accrued wages and other employee costs


12,954



20,452Unearned revenue


22,712



22,352Current portion of long-term debt


12,917



1,375Current liability for post-retirement benefits


2,632



2,632Current liability for pension benefits


121



121Other accrued liabilities


16,400



18,167Total current liabilities


115,049



119,521Long-term debt


227,510



238,550Noncurrent liability for post-retirement benefits


30,934



30,732Noncurrent liability for pension benefits


26,765



26,535Deferred income taxes


154



154Other noncurrent liabilities


13,224



11,777Total liabilities


413,636



427,269Commitments and ContingenciesShareholders equity:Common stock, $0.01 par value; 50,000,000 shares
    authorized; 23,777,620 and 23,688,010 shares issued;
    23,083,532 and 23,004,136 shares outstanding


238



237Additional paid-in capital


308,519



307,604Treasury stock, at cost; 694,088 and 683,874 shares


(16,975
)


(16,891
)Accumulated other comprehensive loss


(47,732
)


(46,352
)Retained earnings


355,877



357,336Total shareholders equity


599,927



601,934Total liabilities and shareholders equity

$
1,013,563


$
1,029,203   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 Statements of Cash Flows

(Unaudited)





(In
    thousands) Three Months EndedMarch 31,2009


2008OPERATING ACTIVITIES:Net income (loss)

$
(1,459
)

$
22,237Adjustment for non-cash items included in net income:Depreciation and amortization


5,312



4,730Deferred income taxes


(2,029
)


(3,558
)Stock-based compensation


1,222



1,492Excess tax benefits from stock-based compensation activity


(339
)


(290
)Other


(57
)


2Changes in assets and liabilities:Receivables


12,846



(768
)Inventories


(9,022
)


(23,565
)Accounts payable


4,011



(1,000
)Income taxes payable


(290
)


12,119Unearned revenue


670



11,067Other current liabilities


(11,128
)


(8,678
)Other assets and liabilities


2,525



1,482Cash provided by operating activities


2,262



15,270INVESTING ACTIVITIES:Capital expenditures


(26,055
)


(20,975
)Cash used in investing activities


(26,055
)


(20,975
)FINANCING ACTIVITIES:Proceeds from exercise of employee stock options


22



84Excess tax benefits from stock-based compensation activity


339



290Borrowings on long-term debt


1,184



Repayments on long-term debt


(212
)


(283
)Purchase of common stock held in treasury


(84
)


(9,086
)Cash provided by (used in) financing activities


1,249



(8,995
)Effect of exchange rate changes on cash and cash equivalents


939



(366
)Decrease in cash and cash equivalents


(21,605
)


(15,066
)Cash and cash equivalents at beginning of period


284,449



107,505Cash and cash equivalents at end of period

$
262,844


$
92,439   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
    Consolidated Statements of Comprehensive Income and
    Shareholders Equity

(Unaudited)





(In
    thousands, except share amounts) Accumulated OtherComprehensive Income(Loss)Net Unrealized Gain(Loss) FromCommon Stock


Additional











Minimum


ForeignShares





Paid-In


Treasury


Retained


Derivative


Pension


CurrencyOutstanding


Amount


Capital


Stock


Earnings


Instruments


Liability


Translation


TotalBalance at December 31, 2008


23,004,136


$
237


$
307,604


$
(16,891
)

$
357,336


$
(3,325
)

$
(39,321
)

$
(3,706
)

$
601,934Net loss


















(1,459
)














(1,459
)Foreign currency translation






























(2,002
)


(2,002
)Unrecognized gain on derivatives (interest rate swaps), net of
    tax






















5











5Benefit plan amortization


























617







617Comprehensive loss


































(2,839
)Shares issued for restricted stock award plans


87,360



1



























1Stock-based compensation expense recognized










1,222























1,222Treasury stock purchased at cost


(5,814
)










(84
)


















(84
)Exercise of employee options


2,250







22























22Forfeiture of restricted stock awards


(4,400
)






























Tax benefits from stock-based compensation activity










(329
)






















(329
)Balance at March 31, 2009


23,083,532


$
238


$
308,519


$
(16,975
)

$
355,877


$
(3,320
)

$
(38,704
)

$
(5,708
)

$
599,927   The accompanying notes are an integral part of these
    Consolidated Financial Statements.
 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)
  Note 1
    BASIS OF
    PRESENTATION:  Form 10-Q Regulation S-X.
  Form 10-K.
  Note 2
    ORGANIZATION:          just-in-time
 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 3
    STOCK-BASED
    COMPENSATION:  Stock
    Options
    Stock Options

SharesOutstanding at December 31, 2008


352,680Granted


170,430Forfeited


(4,934
)Expired


(1,366
)Exercised


(2,250
)Outstanding at March 31, 2009


514,560Exercisable at March 31, 2009


286,030     2009Risk-free interest rate


1.85
%Expected dividend yield


0.00
%Expected lives (in years)


4.0Expected volatility


58.00
%   Restricted
    Stock
    Nonvested Restricted Stock Awards

SharesNonvested at December 31, 2008


161,669Granted


87,360Vested


(50,486
)Forfeited


(4,400
)Nonvested at March 31, 2009


194,143    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

Granted


Eligible to ReceiveOutstanding at December 31, 2008


28,500



57,000Granted


85,730



171,460Forfeited


(3,000
)


(6,000
)Outstanding at March 31, 2009


111,230



222,460     Note 4
    INCOME
    TAXES:        Note 5
    EARNINGS
    PER SHARE:  Earnings Per Share
 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)
      Three Months EndedMarch 31,2009


2008Numerator:Net income

$
(1,459
)

$
22,237Denominator:Basic weighted-average shares outstanding


22,877,409



22,946,511Effect of diluted securities






240,447Diluted weighted-average shares outstanding


22,877,409



23,186,958Earnings per share:Basic

$
(0.06
)

$
0.97Diluted

$
(0.06
)

$
0.96     Note 6INVENTORIES:
  last-in, first-in,
  March 31,


December 31,2009


2008Raw materials and supplies

$
124,367


$
124,689Work-in-process
    and finished goods


231,820



228,745LIFO reserve


(74,762
)


(79,104
)Total inventories

$
281,425


$
274,330  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 7
    GOODWILL
    AND OTHER INTANGIBLE ASSETS:  Goodwill and Other Intangible Assets
    Goodwill.
  December 31,


Translation


March 31,2008


Adjustment


2009Titanium Group

$
2,548


$



$
2,548Fabrication Group


35,603



(367
)


35,236Distribution Group


9,833







9,833Total goodwill

$
47,984


$
(367
)

$
47,617   Intangibles.
    December 31,



Translation

March 31,2008

Amortization

Adjustment

2009Fabrication Group

$
13,196



(207
)


(422
)

$
12,567   Note 8
    UNEARNED
    REVENUE:   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)
  Note 9
    OTHER
    INCOME:    Note 10
    EMPLOYEE
    BENEFIT PLANS:    Other Post-RetirementPension Benefits


Benefits2009


2008


2009


2008Service cost

$
398


$
485


$
128


$
129Interest cost


1,762



1,783



535



505Expected return on plan assets


(1,929
)


(2,218
)






Amortization of prior service cost


209



206



303



303Amortization of unrealized gains and losses


480



537







Net periodic benefit cost

$
920


$
793


$
966


$
937   Note 11
    COMMITMENTS
    AND CONTINGENCIES:    Environmental
    Matters
  96-1, Environmental Remediation Liabilities Accounting for 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)
        Duty
    Drawback Investigation
        Accounting for Contingencies
 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)
    Other
    Matters
    NOTE 12
    LONG-TERM
    DEBT:    March 31,


December 31,2009


2008RTI term loan

$
225,000


$
225,000RTI Claro credit agreement


11,198



11,792Interest-free loan agreement  Canada


4,101



2,995Other


128



138Total debt

$
240,427


$
239,925Less: Current portion


(12,917
)


(1,375
)Long-term debt

$
227,510


$
238,550   NOTE 13
    SEGMENT
    REPORTING:       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)
    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 EndedMarch 31,2009


2008Net sales:Titanium Group

$
30,303


$
55,127Intersegment sales


33,751



47,089Total Titanium Group net sales


64,054



102,216Fabrication Group


26,064



29,912Intersegment sales


14,365



22,451Total Fabrication Group net sales


40,429



52,363Distribution Group


49,687



65,609Intersegment sales


677



823Total Distribution Group net sales


50,364



66,432Eliminations


48,793



70,363Total consolidated net sales

$
106,054


$
150,648Operating income (loss):Titanium Group before corporate allocations

$
6,979


$
31,357Corporate allocations


(2,758
)


(3,005
)Total Titanium Group operating income


4,221



28,352Fabrication Group before corporate allocations


(4,652
)


(456
)Corporate allocations


(2,569
)


(2,430
)Total Fabrication Group operating loss


(7,221
)


(2,886
)Distribution Group before corporate allocations


4,264



9,777Corporate allocations


(2,043
)


(2,017
)Total Distribution Group operating income


2,221



7,760Total consolidated operating income (loss)

$
(779
)

$
33,226Income (loss) before income taxes:Titanium Group

$
4,711


$
28,903Fabrication Group


(8,802
)


(3,562
)Distribution Group


2,431



8,733Total consolidated income (loss) before income taxes

$
(1,660
)

$
34,074   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)
  March 31,


December 31,2009


2008Total assets:Titanium Group

$
389,679


$
374,999Fabrication Group


224,621



224,534Distribution Group


142,952



155,838General corporate assets


256,311



273,832Total consolidated assets

$
1,013,563


$
1,029,203   NOTE 14
    FINANCIAL
    INSTRUMENTS:  Accounting for Derivative Instruments
    and Hedging Activities
      NOTE 15
    FAIR
    VALUE MEASUREMENTS:  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)
      NOTE 16
    NEW
    ACCOUNTING STANDARDS:  Business Combinations
  Noncontrolling Interests in Consolidated Financial
    Statements  an amendment of ARB No. 51
  Disclosures about Derivative Instruments and Hedging
    Activities  an amendment of FASB Statement
    No. 133
  The
    Hierarchy of Generally Accepted Accounting Principles
 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)
    Employers Disclosure about
    Postretirement Benefit Plan Assets
 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 effect of the slowdown in U.S. and global economic activity
    and policy changes with the new U.S. Presidential
    administration,
    statements regarding 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,
    the success of new market development,
    long-term supply agreements,
    the impact of Boeing 787 production delays,
    legislative challenges to the Specialty Metals Clause of the
    Berry Amendment,
    labor matters,
    outcome of the pending U.S. Customs 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.   19




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##### Table of Contents



Overview
          just-in-time
       20




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##### Table of Contents



Three
    Months Ended March 31, 2009 Compared To Three Months Ended
    March 31, 2008
  Net Sales.
  Three MonthsEndedMarch 31,


$ Increase/


% Increase/(In millions except percents)

2009


2008


(Decrease)


(Decrease)Titanium Group

$
30.3


$
55.1


$
(24.8
)


(45.0
)%Fabrication Group


26.1



29.9



(3.8
)


(12.7
)%Distribution Group


49.7



65.6



(15.9
)


(24.2
)%Total consolidated net sales

$
106.1


$
150.6


$
(44.5
)


(29.5
)%       C-17.
  Gross Profit (Loss).
  Three MonthsEndedMarch 31,


$ Increase/


% Increase/(In millions except percents)

2009


2008


(Decrease)


(Decrease)Titanium Group

$
9.4


$
33.6


$
(24.2
)


(72.0
)%Fabrication Group


(1.3
)


4.6



(5.9
)


(128.3
)%Distribution Group


8.2



13.9



(5.7
)


(41.0
)%Total consolidated gross profit (loss)

$
16.3


$
52.1


$
(35.8
)


(68.7
)%      21




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##### Table of Contents



Selling, General, and Administrative
    Expenses.
  Three MonthsEndedMarch 31,


$ Increase/


% Increase/(In millions except percents)

2009


2008


(Decrease)


(Decrease)Titanium Group

$
4.7


$
4.8


$
(0.1
)


(2.1
)%Fabrication Group


5.9



7.4



(1.5
)


(20.3
)%Distribution Group


5.9



6.1



(0.2
)


(3.3
)%Total consolidated SG&A expenses

$
16.5


$
18.3


$
(1.8
)


(9.8
)%     Research, Technical, and Product Development
    Expenses.
  Operating Income (Loss).
  Three MonthsEndedMarch 31,


$ Increase/


% Increase/(In millions except percents)

2009


2008


(Decrease)


(Decrease)Titanium Group

$
4.2


$
28.3


$
(24.1
)


(85.2
)%Fabrication Group


(7.2
)


(2.9
)


(4.3
)


(148.3
)%Distribution Group


2.2



7.8



(5.6
)


(71.8
)%Total operating income (loss)

$
(0.8
)

$
33.2


$
(34.0
)


(102.4
)%        22




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##### Table of Contents



Other Income (Expense).
  Interest Income and Interest Expense.
  Provision for (Benefit from) Income Taxes.
  Liquidity
    and Capital Resources
        Cash provided by operating activities.
 23




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##### Table of Contents



Cash used in investing activities.
  Cash provided by (used in) financing
    activities.
  Duty
    Drawback Investigation
        Accounting for Contingencies
  Backlog
   24




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##### Table of Contents



Environmental
    Matters
  96-1, Environmental Remediation Liabilities Accounting for Contingencies
        New
    Accounting Standards
  Business Combinations
  Noncontrolling Interests in Consolidated Financial
    Statements  an amendment of ARB No. 51
  Disclosures about Derivative Instruments and Hedging
    Activities  an amendment of FASB Statement
    No. 133
 25




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##### Table of Contents



The
    Hierarchy of Generally Accepted Accounting Principles
  Employers Disclosure about
    Postretirement Benefit Plan Assets SFAS 132(R-1
  Item 3.
    Quantitative
    and Qualitative Disclosures About Market Risk.  Form 10-K
  Item 4.
    Controls
    and Procedures.  Rules 13a-15(e) 15d-15(e)
   26




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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.   27




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##### Table of Contents



SIGNATURES        By
    /s/  William
    T. Hull   Senior Vice President and Chief Financial Officer
 28




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##### Table of Contents



INDEX TO
    EXHIBITS
  ExhibitNo.

Description31
.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.  29