<PAGE>

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                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                             ---------------------

                                   FORM 10-Q

(Mark One)

[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
    1934

FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2005.

                                       OR

[ ] 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)

<Table>
  <S>                                    <C>
                  OHIO                             52-2115953
     (State or other jurisdiction of     (I.R.S. Employer Identification
     incorporation or organization)                   No.)
</Table>

                     1000 WARREN AVENUE, NILES, OHIO 44446
                    (Address of principal executive offices)

                                 (330) 544-7700
              (Registrant's telephone number, including area code)

     Indicate 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 (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
                                 YES X   NO ___

     Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act).
                                 YES X   NO ___

     Indicate by check mark whether the registrant is a shell company (as
defined in Rule 12b-2 of the Exchange Act).
                                 YES ___   NO X

     At November 1, 2005, 23,023,648 shares of common stock of the registrant
were outstanding.

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>

                         RTI INTERNATIONAL METALS, INC.

                                   FORM 10-Q
                        QUARTER ENDED SEPTEMBER 30, 2005

                                     INDEX

<Table>
<Caption>
                                                                               PAGE
                                                                               ----
<S>              <C>                                                           <C>
PART I--FINANCIAL INFORMATION

Item 1.          Financial Statements:.......................................    2
     Consolidated Statement of Operations (Unaudited)........................    2
     Consolidated Balance Sheet (Unaudited)..................................    3
     Consolidated Statement of Cash Flows (Unaudited)........................    4
     Consolidated Statement of Changes in Shareholders' Equity (Unaudited)...    5
     Condensed Notes to Consolidated Financial Statements (Unaudited)........    6

Item 2.          Management's Discussion and Analysis of Financial Condition    20
                 and Results of Operations...................................

Item 3.          Quantitative and Qualitative Disclosures about Market          32
                 Risk........................................................

Item 4.          Controls and Procedures.....................................   32

PART II--OTHER INFORMATION

Item 2.          Unregistered Sales of Equity Securities and Use of             34
                 Proceeds....................................................

Item 5.          Other Information...........................................   34

Item 6.          Exhibits....................................................   34

Signatures...................................................................   35
</Table>
<PAGE>

                         PART I--FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

                         RTI INTERNATIONAL METALS, INC.

                      CONSOLIDATED STATEMENT OF OPERATIONS
                                  (UNAUDITED)

                  (DOLLARS IN THOUSANDS, EXCEPT SHARE AMOUNTS)

<Table>
<Caption>
                                                          QUARTER ENDED             NINE MONTHS ENDED
                                                          SEPTEMBER 30,               SEPTEMBER 30,
                                                    -------------------------   -------------------------
                                                       2005          2004          2005          2004
                                                    -----------   -----------   -----------   -----------
<S>                                                 <C>           <C>           <C>           <C>
Sales.............................................  $    81,167   $    50,951   $   249,694   $   153,290
Operating costs:
Cost of sales.....................................       54,283        43,302       172,295       134,587
Selling, general and administrative expenses......       12,914        10,064        34,598        26,443
Research, technical and product development
  expenses........................................          392           281         1,175           865
                                                    -----------   -----------   -----------   -----------
     Total operating costs........................       67,589        53,647       208,068       161,895
                                                    -----------   -----------   -----------   -----------
Other operating income............................           --           420            --           517
                                                    -----------   -----------   -----------   -----------
Operating income (loss)...........................       13,578        (2,276)       41,626        (8,088)
Other income (Note 10)............................           78           149           531         9,521
Interest income...................................          274            67           670            93
                                                    -----------   -----------   -----------   -----------
Income (loss) from continuing operations before
  income taxes....................................       13,930        (2,060)       42,827         1,526
Provision for income taxes (Note 5)...............        5,268             8        15,186           624
                                                    -----------   -----------   -----------   -----------
Income (loss) from continuing operations..........        8,662        (2,068)       27,641           902
(Loss) Income from discontinued operations, net of
  tax (Note 15)...................................           --           (99)           --           139
                                                    -----------   -----------   -----------   -----------
Net income (loss).................................  $     8,662   $    (2,167)  $    27,641   $     1,041
                                                    ===========   ===========   ===========   ===========
Basic earnings per common share (Note 6):
  Continuing operations...........................  $      0.38   $     (0.10)  $      1.24   $      0.04
  Discontinued operations.........................  $        --   $        --   $        --   $      0.01
                                                    -----------   -----------   -----------   -----------
  Net income (loss)...............................  $      0.38   $     (0.10)  $      1.24   $      0.05
                                                    ===========   ===========   ===========   ===========
Diluted earnings per common share (Note 6):
  Continuing operations...........................  $      0.38   $     (0.10)  $      1.22   $      0.04
  Discontinued operations.........................  $        --   $        --   $        --   $      0.01
                                                    -----------   -----------   -----------   -----------
  Net income (loss)...............................  $      0.38   $     (0.10)  $      1.22   $      0.05
                                                    ===========   ===========   ===========   ===========
Weighted average shares used to compute earnings
  per share:
  Basic...........................................   22,526,194    21,220,933    22,251,556    21,176,706
                                                    -----------   -----------   -----------   -----------
                                                    -----------   -----------   -----------   -----------
  Diluted.........................................   22,944,670    21,509,070    22,692,283    21,476,247
                                                    -----------   -----------   -----------   -----------
                                                    -----------   -----------   -----------   -----------
</Table>

  The accompanying notes are an integral part of these Consolidated Financial
                                  Statements.
                                        2
<PAGE>

                         RTI INTERNATIONAL METALS, INC.

                           CONSOLIDATED BALANCE SHEET
                                  (UNAUDITED)

                  (DOLLARS IN THOUSANDS, EXCEPT SHARE AMOUNTS)

<Table>
<Caption>
                                                    SEPTEMBER 30,   DECEMBER 31,
                                                        2005            2004
                                                    -------------   ------------
<S>                                                 <C>             <C>
                      ASSETS
ASSETS:
  Cash and cash equivalents.......................    $ 37,648        $ 62,701
  Receivables, less allowance for doubtful
     accounts of $1,660 and $1,485................      53,701          44,490
  Inventories (Note 7)............................     208,820         133,512
  Current deferred income tax asset...............       1,145           1,145
  Income tax receivable...........................       2,462           3,321
  Other current assets............................       6,445           3,597
                                                      --------        --------
     Total current assets.........................     310,221         248,766
  Property, plant and equipment, net..............      81,393          82,593
  Goodwill (Note 8)...............................      48,733          46,618
  Other intangible assets, net (Note 8)...........      16,788          16,040
  Noncurrent deferred income tax asset............       3,012           3,012
  Intangible pension asset........................       3,365           3,365
  Other noncurrent assets.........................       2,570           3,099
                                                      --------        --------
     Total assets.................................    $466,082        $403,493
                                                      ========        ========


       LIABILITIES AND SHAREHOLDERS' EQUITY

LIABILITIES:
  Accounts payable................................    $ 24,894        $ 14,253
  Accrued wages and other employee costs..........       9,445           4,863
  Billings in excess of costs and estimated
     revenues (Note 9)............................      12,262           4,708
  Other accrued liabilities.......................       6,100           6,498
                                                      --------        --------
     Total current liabilities....................      52,701          30,322
  Accrued postretirement benefit cost.............      20,827          20,811
  Accrued pension cost............................      14,798          21,090
  Other noncurrent liabilities....................       6,122           7,312
                                                      --------        --------
     Total liabilities............................      94,448          79,535
                                                      --------        --------
  Commitments and contingencies (Note 12)
SHAREHOLDERS' EQUITY:
  Common stock, $0.01 par value, 50,000,000 shares
     authorized; 23,102,531 and 22,194,344 shares
     issued; 22,658,459 and 21,772,730 shares
     outstanding..................................         233             221
  Additional paid-in capital......................     277,438         258,526
  Deferred compensation...........................      (3,346)         (2,499)
  Treasury stock, at cost; 444,072 and 421,614
     shares.......................................      (4,389)         (3,906)
  Accumulated other comprehensive loss............     (20,318)        (22,759)
  Retained earnings...............................     122,016          94,375
                                                      --------        --------
     Total shareholders' equity...................     371,634         323,958
                                                      --------        --------
       Total liabilities and shareholders'
        equity....................................    $466,082        $403,493
                                                      ========        ========
</Table>

  The accompanying notes are an integral part of these Consolidated Financial
                                  Statements.
                                        3
<PAGE>

                         RTI INTERNATIONAL METALS, INC.

                      CONSOLIDATED STATEMENT OF CASH FLOWS
                                  (UNAUDITED)

                             (DOLLARS IN THOUSANDS)

<Table>
<Caption>
                                                                 NINE MONTHS ENDED
                                                                   SEPTEMBER 30,
                                                              ------------------------
                                                                2005         2004
                                                              --------   -------------
                                                                          (RESTATED)
                                                                         (SEE NOTE 17)
<S>                                                           <C>        <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income..................................................  $ 27,641     $  1,041
Income from discontinued operations, net of tax.............        --          139
                                                              --------     --------
Income from continuing operations...........................    27,641          902
Adjustments to reconcile net income to net cash provided by
  (used in) operating activities:
  Depreciation and amortization.............................     9,750        8,892
  Stock-based compensation expense and other................       881          581
  Gain on sale of property, plant and equipment.............        (4)        (356)
  Tax benefits from exercise of stock options...............     3,812          766
  Other.....................................................      (590)         177
CHANGES IN ASSETS AND LIABILITIES (EXCLUDING CASH):
  Receivables...............................................   (10,151)      (7,068)
  Inventories...............................................   (75,166)      14,127
  Accounts payable..........................................    11,085       (3,498)
  Income taxes receivable...................................       380       (4,286)
  Billings in excess of costs and estimated revenues........     7,593       (2,228)
  Accrued pension cost......................................    (6,292)       1,737
  Other current liabilities.................................     4,366        4,093
  Other assets and liabilities..............................    (3,811)        (922)
                                                              --------     --------
  Cash (used in) provided by continuing operating
     activities.............................................   (30,506)      12,917
  Cash provided by discontinued operating activities........        --        1,355
                                                              --------     --------
     Cash (used in) provided by operating activities........   (30,506)      14,272
                                                              --------     --------
CASH FLOWS FROM INVESTING ACTIVITIES:
  Acquisitions, net of cash acquired, and other investing...      (290)      (2,210)
  Proceeds from disposal of property, plant and equipment...         5          579
  Capital expenditures......................................    (7,640)      (4,209)
                                                              --------     --------
     Cash used in investing activities......................    (7,925)      (5,840)
                                                              --------     --------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from exercise of employee stock options..........    13,387        2,372
  Purchase of common stock held in treasury.................      (483)        (288)
  Deferred charges related to credit facility...............        --         (285)
                                                              --------     --------
     Cash provided by financing activities..................    12,904        1,799
                                                              --------     --------
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH
  EQUIVALENTS...............................................       474          168
                                                              --------     --------
(DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS............   (25,053)      10,399
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD............    62,701       67,970
                                                              --------     --------
CASH AND CASH EQUIVALENTS AT END OF PERIOD..................  $ 37,648     $ 78,369
                                                              ========     ========
SUPPLEMENTAL CASH FLOW INFORMATION:
  Cash paid for interest, net of amounts capitalized........  $    378     $    335
  Cash paid for income taxes................................  $ 10,678     $  4,148
NON-CASH FINANCING ACTIVITIES:
  Issuance of common stock for vested restricted stock
     awards.................................................  $  1,725     $  1,301
  Capital lease obligations incurred........................  $    116     $      6
</Table>

  The accompanying notes are an integral part of these Consolidated Financial
                                  Statements.
                                        4
<PAGE>

                         RTI INTERNATIONAL METALS, INC.

           CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
                                  (UNAUDITED)

                  (DOLLARS IN THOUSANDS, EXCEPT SHARE AMOUNTS)
<Table>
<Caption>
                                                           ADDT'L                   TREASURY                  OTHER
                                     SHARES      COMMON   PAID-IN      DEFERRED      COMMON    RETAINED   COMPREHENSIVE
                                   OUTSTANDING   STOCK    CAPITAL    COMPENSATION    STOCK     EARNINGS   INCOME (LOSS)    TOTAL
                                   -----------   ------   --------   ------------   --------   --------   -------------   --------
<S>                                <C>           <C>      <C>        <C>            <C>        <C>        <C>             <C>
Balance at December 31, 2004.....  21,772,730     $221    $258,526     $(2,499)     $(3,906)   $ 94,375     $(22,759)     $323,958
Shares issued for restricted
  stock award plans..............      76,812        1       1,724      (1,725)          --          --           --            --
Compensation expense
  recognized.....................          --       --          --         878           --          --           --           878
Treasury common stock purchased
  at cost........................     (22,458)      --          --          --         (483)         --           --          (483)
Exercise of employee stock
  options including tax benefit
  of stock plans.................     831,375       11      17,188          --           --          --           --        17,199
Net income.......................          --       --          --          --           --      27,641           --        27,641
Foreign currency translation, net
  of tax.........................          --       --          --          --           --          --        2,441         2,441
Comprehensive income.............
                                   ----------     ----    --------     -------      -------    --------     --------      --------
Balance at September 30, 2005....  22,658,459     $233    $277,438     $(3,346)     $(4,389)   $122,016     $(20,318)     $371,634
                                   ==========     ====    ========     =======      =======    ========     ========      ========

<Caption>

                                   COMPREHENSIVE
                                      INCOME
                                   -------------
<S>                                <C>
Balance at December 31, 2004.....
Shares issued for restricted
  stock award plans..............
Compensation expense
  recognized.....................
Treasury common stock purchased
  at cost........................
Exercise of employee stock
  options including tax benefit
  of stock plans.................
Net income.......................     $27,641
Foreign currency translation, net
  of tax.........................       2,441
                                      -------
Comprehensive income.............     $30,082
                                      =======
Balance at September 30, 2005....
</Table>

  The accompanying notes are an integral part of these Consolidated Financial
                                  Statements.

                                        5
<PAGE>

                         RTI INTERNATIONAL METALS, INC.

              CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  (UNAUDITED)

NOTE 1-- BASIS OF PRESENTATION

     The accompanying condensed consolidated financial statements have been
prepared by RTI International Metals, Inc. (the "Company"), without audit,
pursuant to the rules and regulations of the Securities and Exchange Commission.
The consolidated financial statements include the accounts of RTI International
Metals, Inc. and its majority owned subsidiaries. All significant intercompany
transactions have been eliminated. The financial information presented reflects
all adjustments, consisting only of normal recurring adjustments, which are, in
the opinion of management, necessary for a fair statement of the results for the
interim periods presented. The financial statements should be read in
conjunction with accounting policies and notes to consolidated financial
statements included in the Company's 2004 Annual Report (Consolidated Financial
Statements) on Form 10-K, as amended. Certain prior period amounts have been
reclassified to conform to the current period presentation. The results for the
interim periods are not necessarily indicative of the results to be expected for
the year.

NOTE 2-- ORGANIZATION

     RTI International Metals, Inc. is a leading U.S. producer of titanium mill
products and fabricated metal parts for the global market. The Company conducts
business in two segments: the Titanium Group and the Fabrication and
Distribution Group. The Titanium Group melts and produces a complete range of
titanium mill products, which are further processed by its customers for use in
a variety of commercial, aerospace, defense, and industrial applications. The
Fabrication and Distribution Group is comprised of companies that process and
distribute titanium and other specialty metals. Its products, many of which are
engineered parts and assemblies, serve aerospace, oil and gas, power generation,
and chemical process industries, as well as a number of other industrial and
consumer markets.

     On September 30, 1998, the shareholders of the Company's now wholly-owned
subsidiary RMI Titanium Company ("RMI") approved a proposal to reorganize into a
holding company structure (the "1998 Reorganization"). Pursuant to this
reorganization, the Company became the parent company of RMI, and shares of RMI
common stock were automatically exchanged on a one-for-one (1:1) basis for
shares of RTI. Shares of RTI began trading on the New York Stock Exchange on
October 1, 1998.

     The Company is a successor to entities that have been operating in the
titanium industry since 1951. In 1990, USX Corporation ("USX") and Quantum
Chemical Corporation ("Quantum") transferred their entire ownership interest in
RMI's immediate predecessor, RMI Company, an Ohio general partnership, to the
Company in exchange for shares of the Company's common stock (the "1990
Reorganization"). Quantum sold its shares of common stock to the public while
USX retained ownership of its shares. USX terminated its ownership interest in
RTI in 2000.

NOTE 3-- ACQUISITIONS

     On October 1, 2004, RTI acquired all of the stock of Claro Precision, Inc.,
("Claro") of Montreal, Quebec, Canada. The aggregate purchase price was $30.6
million consisting of cash of $23.6 million less cash acquired of $1.6 million
and 358,908 shares of RTI common stock with a fair value of $7.0 million. The
purchase agreement provided for a post-closing audit period for adjustments to
the purchase price to finalize and determine whether the target equity amount of
$9.7 million existed on the closing date. The Company has subsequently agreed
that the target equity amount was achieved and has included $0.2 million as
additional purchase price allocation which was previously excluded, resulting in
an increase to goodwill of $0.2 million. At September 30, 2005 the Company has
concluded its evaluation of pre-acquisition contingencies in accordance with
Statement of Financial Accounting Standards "Business Combinations" SFAS No. 141

                                        6
<PAGE>

(SFAS 141) and determined that the fair value of certain inventories should be
reduced by $0.4 million and goodwill increased by $0.4 million.

     The purchase was made with available cash on hand and newly issued common
shares. Claro operates and reports under the Company's Fabrication and
Distribution segment and was reflected in results of operations effective
October 1, 2004.

     Claro is a manufacturer of precision-machined components and complex
mechanical and electrical assemblies for the aerospace industry.

     The following is a summary of the allocation of the purchase price to the
assets acquired and liabilities assumed from Claro based on their fair market
values as of October 1, 2004 including adjustments determined at September 30,
2005. In accordance with SFAS 141, the purchase price was assigned to the assets
and liabilities acquired based on fair value. Fair value is defined in SFAS 141
as the "amount at which that asset (or liability) could be bought (or incurred)
or sold (or settled) in a current transaction between willing parties, that is,
other than in a forced liquidation sale."

<Table>
<Caption>
                                                              ALLOCATED
                                                              PURCHASE
                       (IN THOUSANDS)                           PRICE
                       --------------                         ---------
<S>                                                           <C>
Acquired assets:
Receivables.................................................   $ 2,802
Inventories.................................................     4,328
Other assets................................................        46
Property, plant & equipment.................................     3,836
Goodwill....................................................    11,090
Intangible assets...........................................    16,200
                                                               -------
  Total assets..............................................    38,302
Acquired liabilities:
Accounts payable............................................     1,010
Income taxes payable........................................     1,543
Current deferred income taxes liability.....................     1,145
Other accrued liabilities...................................       160
Noncurrent deferred income taxes............................     5,414
                                                               -------
  Total liabilities.........................................     9,272
                                                               -------
  Net assets acquired.......................................   $29,030
                                                               =======
  Purchase price
     Cash...................................................    22,014
     RTI common stock.......................................     7,016
                                                               -------
                                                               $29,030
                                                               =======
</Table>

     The following unaudited pro forma information for RTI is provided to
include the results of Claro as if the acquisition had been consummated at the
beginning of the period presented,

<Table>
<Caption>
                                                               PRO FORMA       PRO FORMA
                                                                QUARTER       NINE MONTHS
                                                                 ENDED           ENDED
                                                             SEPTEMBER 30,   SEPTEMBER 30,
           (IN THOUSANDS, EXCEPT PER SHARE DATA)                 2004            2004
           -------------------------------------             -------------   -------------
                                                              (UNAUDITED)     (UNAUDITED)
<S>                                                          <C>             <C>
Net sales..................................................     $54,775        $164,761
Net (loss) income..........................................     $(1,260)       $  3,326
Net (loss) income per common share
  Basic....................................................       (0.06)           0.16
  Diluted..................................................       (0.06)           0.15
</Table>

                                        7
<PAGE>

     The $16.2 million of intangible assets represent the assigned value of
customer relationships with an estimated useful life of approximately 20 years.
Accumulated amortization at September 30, 2005 and December 31, 2004 related to
these intangible assets was $763 thousand and $160 thousand, respectively.
Goodwill of $11.1 million resulted from the acquisition and is non-deductible
for income tax purposes in Canada. Additionally, fixed assets were stepped-up to
approximate fair market value and are being depreciated in accordance with the
Company's accounting policies.

     The pro forma combined financial results have been prepared for comparative
purposes only and include certain adjustments as described above. The pro forma
information does not purport to be indicative of the results of operations that
actually would have resulted had the combination occurred on January 1, 2004, or
of future results of the consolidated entities.

NOTE 4-- STOCK OPTION AND RESTRICTED STOCK AWARD PLANS

     The 2004 Stock Plan, which was approved by a vote of the Company's
shareholders at the 2004 Annual Meeting of Shareholders, replaced the 1995 Stock
Plan and the 2002 Non-Employee Director Stock Option Plan.

     The 2004 Plan limits the number of shares available for issuance to
2,500,000 (plus any shares covered by options already outstanding under the 1995
Plan and 2002 Plan that expire or are terminated without being exercised and any
shares delivered in connection with the exercise of any outstanding awards under
the 1995 Plan and 2002 Plan) during its ten-year term and limits the number of
shares available for grants of restricted stock to 1,250,000. The plan expires
after ten years and requires that the exercise price of stock options, stock
appreciation rights and other similar instruments awarded under the plan is not
less than the fair market value of RTI stock on the date of the grant award.

     During the nine months ended September 30, 2005, options to purchase up to
84,500 shares were granted at an exercise price of $21.50 per share and 10,000
shares at the price of $34.90. All option exercise prices were equal to the
common stock's fair market value on the date of the grant. Options are for a
term of ten years from the date of the grant, and vest ratably over the
three-year period beginning with the date of the grant. All 94,500 shares
underlying options granted in 2005 were outstanding at September 30, 2005.

     During the nine months ended September 30, 2005, 76,812 shares of
restricted stock were granted under the 2004 Stock Plan. Compensation expense
equal to the fair market value on the date of the grant is recognized ratably
over the vesting period of each grant which is typically five years.

     As permitted by the provisions of SFAS No. 123, "Accounting for Stock-Based
Compensation" (SFAS 123), the Company has elected to measure stock-based
compensation under the provisions of Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees" (APB No. 25), and to adopt the
disclosure-only alternative described in SFAS 123 as amended by SFAS No. 148.
For restricted stock awards, the Company records deferred stock-based
compensation based on the fair market value of common stock on the date of the
award. Such deferred stock-based compensation is amortized over the vesting
period of each individual award.

     If compensation expense for the Company's stock options granted had been
determined based on the fair value at the grant date for the awards in
accordance with SFAS 123, the effect on the Company's net income

                                        8
<PAGE>

and earnings per share for the quarter and nine months ended September 30, 2005
and 2004 would have been as follows (dollars in thousands; except per share
amounts):

<Table>
<Caption>
                                                            QUARTER ENDED     NINE MONTHS ENDED
                                                            SEPTEMBER 30,       SEPTEMBER 30,
                                                           ----------------   ------------------
                                                            2005     2004       2005      2004
                                                           ------   -------   --------   -------
                                                             (UNAUDITED)         (UNAUDITED)
<S>                                                        <C>      <C>       <C>        <C>
Net income (loss)........................................  $8,662   $(2,167)  $27,641    $1,041
Add: Stock-based employee compensation expense included
  in reported net income (loss), net of related tax
  effects................................................     217       134       554       343
Deduct: Total stock-based employee compensation expense
  determined under fair value methods for all awards, net
  of related tax effects.................................    (367)     (276)   (1,003)     (769)
                                                           ------   -------   -------    ------
Pro forma net income (loss)..............................  $8,512   $(2,309)  $27,192    $  615
                                                           ======   =======   =======    ======
Net income (loss) per share:
  As reported -basic.....................................  $ 0.38   $ (0.10)  $  1.24    $ 0.05
                -diluted.................................    0.38     (0.10)     1.22      0.05
  Pro forma -basic.......................................    0.38     (0.11)     1.22      0.03
             -diluted....................................    0.37     (0.11)     1.20      0.03
</Table>

     Included in the Company's income for the quarters ended September 30, 2005
and 2004 is stock-based compensation expense relating to restricted stock grants
amounting to $345 and $227 respectively. Net of tax, these amounts were $217 and
$134, respectively. (See Note 16--new accounting pronouncements-discussion on
SFAS 123R)

NOTE 5-- INCOME TAXES

     Income tax expense for the three and nine months ended September 30, 2005
was $5.3 million and $15.2 million, respectively. Included in the year to date
amount is a $0.8 million benefit, principally related to a change in the
Company's Ohio tax status and legislation that phases out the Ohio income tax,
the effects of which were recognized in the second quarter. The third quarter
forecast of the annual effective tax rate applicable to ordinary income was 37%
which exceeds the federal statutory rate of 35% due to state taxes, partially
offset by the utilization of previously impaired foreign net operating losses
and the deduction for qualified production activities.

     Income tax expense for the three and nine months ended September 30, 2004
was zero and $0.6 million, respectively, and was calculated as the actual tax
expense related to income earned from continuing operations up to that date. In
the third quarter of 2004, it was determined that a calculation of an annual
effective tax rate would not result in the best estimate of the tax expense
because relatively modest changes to the relationship between forecasted annual
domestic and foreign income could have the potential to produce significant
changes in the annual effective tax rate. The actual tax rate applicable to
income from continuing operations for the nine month period in 2004 was 41%
which exceeded the federal statutory rate of 35% principally due to state taxes.
There was no tax expense in the three month period ended September 30, 2004 due
to the cumulative effect of applying an annual effective tax rate approach in
prior quarters.

     On October 22, 2004, the President signed the American Jobs Creation Act of
2004 (the "Act"). The Company has estimated that the deduction attributable to
qualified production on activities will decrease its annual effective tax rate
by approximately 1 percentage point. In addition, other effects of the Act
include the one-time deduction of 85% of foreign earnings that are repatriated
to the United States, as defined by the Act. Although certain technical matters
have been clarified, the Company is continuing to evaluate whether, and to what
extent, the Company might repatriate up to $3.0 million of un-remitted foreign
earnings pursuant to this provision. We expect to be in a position to finalize
this assessment by year end.

                                        9
<PAGE>

NOTE 6-- EARNINGS PER SHARE

     A reconciliation of the income and weighted average number of outstanding
common shares used in the calculation of basic and diluted earnings per share
for the quarter ended and nine months ended September 30, 2005 and 2004 is as
follows (in thousands except number of shares and per share amounts):

<Table>
<Caption>
                                   QUARTER ENDED SEPTEMBER 30       NINE MONTHS ENDED SEPTEMBER 30
                                --------------------------------   --------------------------------
                                  NET                  EARNINGS      NET                  EARNINGS
                                INCOME      SHARES     PER SHARE   INCOME      SHARES     PER SHARE
                                -------   ----------   ---------   -------   ----------   ---------
<S>                             <C>       <C>          <C>         <C>       <C>          <C>
2005
Basic EPS.....................  $ 8,662   22,526,194    $ 0.38     $27,641   22,251,556     $1.24
Effect of potential common
  stock:
  Stock options...............       --      418,476        --          --      440,727     (0.02)
                                -------   ----------    ------     -------   ----------     -----
Diluted EPS...................  $ 8,662   22,944,670    $ 0.38     $27,641   22,692,283     $1.22
                                =======   ==========    ======     =======   ==========     =====
2004
Basic EPS.....................  $(2,167)  21,220,933    $(0.10)    $ 1,041   21,176,706     $0.05
Effect of potential common
  stock:
  Stock options...............       --      288,137        --          --      299,541        --
                                -------   ----------    ------     -------   ----------     -----
Diluted EPS...................  $(2,167)  21,509,070    $(0.10)    $ 1,041   21,476,247     $0.05
                                =======   ==========    ======     =======   ==========     =====
</Table>

     There were no shares of common stock excluded from the calculation of
diluted earnings per share for the current quarter. 605,415 shares of common
stock issuable upon exercise of employee stock options have been excluded from
the calculation of diluted earnings per share because the exercise price of the
options exceeded the weighted average market price of the Company's common stock
for the quarter ended September 30, 2004. 2,206 and 606,378 shares of common
stock issuable upon exercise of employee stock options have been excluded from
the calculation of diluted earnings per share for the nine months ended
September 30, 2005 and 2004 respectively, because the exercise price of the
options exceeded the weighted average market price of the Company's common
stock.

NOTE 7-- INVENTORIES

     Inventories consisted of (dollars in thousands):

<Table>
<Caption>
                                                              SEPTEMBER 30,   DECEMBER 31,
                                                                  2005            2004
                                                              -------------   ------------
<S>                                                           <C>             <C>
Raw material and supplies...................................    $ 65,920        $ 40,459
Work-in-process and finished goods..........................     177,701         112,010
Adjustment to LIFO values...................................     (34,801)        (18,957)
                                                                --------        --------
  Inventories, at LIFO cost.................................    $208,820        $133,512
                                                                ========        ========
</Table>

NOTE 8-- GOODWILL AND OTHER INTANGIBLE ASSETS

     The carrying amount of goodwill and other intangible assets attributable to
each segment at December 31, 2004 and September 30, 2005 is as follows (in
thousands):

Goodwill

<Table>
<Caption>
                                                                         TRANSLATION
                                        DECEMBER 31, 2004   ADJUSTMENT   ADJUSTMENT    SEPTEMBER 30, 2005
                                        -----------------   ----------   -----------   ------------------
<S>                                     <C>                 <C>          <C>           <C>
Titanium Group........................       $ 1,955          $  636        $ --            $ 2,591
Fabrication and Distribution Group....        44,663             569         910             46,142
                                             -------          ------        ----            -------
Total.................................       $46,618          $1,205        $910            $48,733
                                             =======          ======        ====            =======
</Table>

                                        10
<PAGE>

     During the nine months ended September 30, 2005, additional goodwill was
added to the Titanium Group through the finalization of the acquisition of the
minority interest in Galt Alloys, Inc. For the Fabrication and Distribution
group, translation of the purchase accounting for Claro in accordance will SFAS
141 resulted in additional goodwill of $569 thousand.

Intangibles

     Other intangible assets are comprised of customer relationships. Their
estimated useful lives are as follows:

<Table>
<Caption>
                             ESTIMATED                                       TRANSLATION
                            USEFUL LIFE   DECEMBER 31, 2004   AMORTIZATION   ADJUSTMENT    SEPTEMBER 30, 2005
                            -----------   -----------------   ------------   -----------   ------------------
<S>                         <C>           <C>                 <C>            <C>           <C>
Titanium Group............                     $    --           $  --         $   --           $    --
Fabrication and
  Distribution Group......   20 years           16,040            (603)         1,351            16,788
                                               -------           -----         ------           -------
Total.....................                     $16,040           $(603)        $1,351           $16,788
                                               =======           =====         ======           =======
</Table>

     For the five succeeding fiscal years, the Company estimates amortization
expense to be approximately $800 thousand per year.

NOTE 9-- BILLINGS IN EXCESS OF COSTS AND ESTIMATED REVENUES

     The Company reported a liability for billings in excess of costs and
estimated revenues of $12.3 million as of September 30, 2005 and $4.7 million as
of December 31, 2004. These amounts represent payments, received in advance from
energy market customers, Titanium Group and Fabrication and Distribution Group
customers on long-term orders, which the Company has not recognized as revenues.

NOTE 10-- OTHER INCOME

     For the quarter and nine months ended September 30, 2005 and 2004, the
components of other income are as follows (dollars in thousands):

<Table>
<Caption>
                                                                                NINE MONTHS
                                                              QUARTER ENDED        ENDED
                                                              SEPTEMBER 30,    SEPTEMBER 30,
                                                              --------------   --------------
                                                              2005     2004    2005     2004
                                                              -----    -----   ----    ------
<S>                                                           <C>      <C>     <C>     <C>
Other Income
Gain on receipt of liquidated damages.......................   $--     $ --    $ --    $9,138(1)
Foreign exchange gains and other............................    78      149     531       383
                                                               ---     ----    ----    ------
                                                               $78     $149    $531    $9,521
                                                               ===     ====    ====    ======
</Table>

(1) The gain resulted from a financial settlement from Boeing Commercial
    Airplane Group ("Boeing") relating to minimum order requirements under terms
    of a long-term agreement between RTI and Boeing. Boeing satisfied the final
    claim under this agreement in the amount of $9.1 million during the first
    quarter of 2004.

NOTE 11-- PENSION AND OTHER POSTRETIREMENT BENEFITS

     The Company provides defined benefit pension plans for certain of its
salaried and represented workforce. Benefits for its salaried participants are
generally based on participant's years of service and compensation. Benefits for
represented pension participants are generally determined based on an amount for
years of service. Other Company employees participate in 401(k) plans whereby
the Company may provide a match of employee contributions. These plans are
generally not significant to the Company. The policy of the Company with respect
to its defined benefit plans is to contribute at least the minimum amounts
required by applicable laws and regulations.

                                        11
<PAGE>

     In the third quarter of 2005, a voluntary contribution of $9.0 million was
made to the defined benefit pension plans.

     The cost of the Company's retiree health care plans (Other Postretirement
Benefits) is capped at predetermined out-of-pocket spending limits. Retiree
health care is available to participants in the defined benefit pension plans.
Benefit payments are made from Company assets and are not funded.

     The 2005 and 2004 amounts shown below reflect the defined benefit pension
and other postretirement benefit expense for the quarter and nine months ended
September 30 for each year for those salaried and hourly covered employees
(dollars in thousands):

<Table>
<Caption>
                                         PENSION BENEFITS                OTHER POSTRETIREMENT BENEFITS
                               -------------------------------------   ---------------------------------
                                 QUARTER ENDED     NINE MONTHS ENDED   QUARTER ENDED   NINE MONTHS ENDED
                                 SEPTEMBER 30,       SEPTEMBER 30,     SEPTEMBER 30,     SEPTEMBER 30,
                               -----------------   -----------------   -------------   -----------------
                                2005      2004      2005      2004     2005    2004     2005      2004
                               -------   -------   -------   -------   -----   -----   -------   -------
<S>                            <C>       <C>       <C>       <C>       <C>     <C>     <C>       <C>
Service cost.................  $   550   $   589   $ 1,650   $ 1,767   $ 96    $ 95    $  288    $  285
Interest cost................    1,592     1,587     4,776     4,761    410     407     1,230     1,221
Expected return on plan
  assets.....................   (1,922)   (2,006)   (5,766)   (6,018)    --      --        --        --
Amortization of prior service
  cost.......................      160       144       480       432     44      44       132       132
Amortization of unrealized
  gains and losses...........      510       357     1,530     1,071     93      70       279       210
                               -------   -------   -------   -------   ----    ----    ------    ------
  Net periodic benefit
    cost.....................  $   890   $   671   $ 2,670   $ 2,013   $643    $616    $1,929    $1,848
                               =======   =======   =======   =======   ====    ====    ======    ======
</Table>

     RTI International Metals also has a supplemental pension Program
("Program") for certain key employees. The Program is unfunded. The third
quarter net periodic benefit cost related to the Program was $93,195 for 2005
and $128,982 for 2004 and for the nine months ended September 30, 2005 and 2004
was $279,585 and $386,946 respectively.

NOTE 12-- COMMITMENTS AND CONTINGENCIES

     In connection with the 1990 Reorganization, the Company agreed to indemnify
USX and Quantum against liabilities related to their ownership of RMI and its
immediate predecessor, Reactive Metals, Inc., which was formed by USX and
Quantum in 1964.

     From time to time, the Company is involved in litigation relating to claims
arising out of its operations in the normal course of business. In our opinion,
the ultimate liability, if any, resulting from these matters will have no
significant effect on our consolidated financial statements. Given the critical
nature of many of the aerospace end uses for the Company's products, including
specifically their use in critical rotating parts of gas turbine engines, the
Company maintains aircraft products liability insurance of $350 million, which
includes grounding liability.

  Environmental Matters

     The Company is subject to environmental laws and regulations as well as
various health and safety laws and regulations that are subject to frequent
modifications and revisions. During the nine months ended September 30, 2005,
the Company spent approximately $0.3 million for environmental remediation,
compliance, and related services. While the costs of compliance for these
matters have not had a material adverse impact on the Company in the past, it is
impossible to accurately predict the ultimate effect these changing laws and
regulations may have on the Company in the future. The Company continues to
evaluate its obligations for environmental related costs on a quarterly basis
and makes adjustments in accordance with provisions of Statement of Position No.
96-1, "Environmental Remediation Liabilities."

     The Company is involved in investigative or cleanup projects under federal
or state environmental laws at a number of waste disposal sites, including the
Fields Brook Superfund Site and the Ashtabula River Area of Concern. Given the
status of the proceedings with respect to these sites, ultimate investigative
and

                                        12
<PAGE>

remediation costs cannot presently be accurately predicted, but could, in the
aggregate, be material. Based on the information available regarding the current
ranges of estimated remediation costs at currently active sites, and what the
Company believes will be its ultimate share of such costs, provisions for
environmental-related costs have been recorded.

     Given the status of the proceedings at certain of these sites, and the
evolving nature of environmental laws, regulations, and remediation techniques,
the Company's ultimate obligation for investigative and remediation costs cannot
be predicted. It is the Company's policy to recognize environmental costs in its
financial statements when an obligation becomes probable and a reasonable
estimate of exposure can be determined.

     At September 30, 2005 and December 31, 2004, the amount accrued for future
environmental-related costs was $3.6 million and $3.8 million, respectively. Of
the total amount accrued at September 30, 2005, $1.4 million is expected to be
paid out within one year and is included in the other accrued liabilities line
of the balance sheet. The remaining $2.2 million is recorded in other
non-current liabilities.

     Based on available information, RMI believes that its share of potential
environmental-related costs, before expected contributions from third parties,
is in a range from $2.3 to $7.5 million in the aggregate. The Company has
included in its other noncurrent assets $2.1 million as expected contributions
from third parties. This amount represents the contributions from third parties
in conjunction with the Company's most likely estimate of $3.7 million. These
third parties include prior owners of RMI property and prior customers of RMI,
that have agreed to partially reimburse the Company for certain
environmental-related costs. The Company has been receiving contributions from
such third parties for a number of years as partial reimbursement for costs
incurred by the Company.

     As these proceedings continue toward final resolution, amounts in excess of
those already provided may be necessary to discharge the Company from its
obligations for these sites.

  Former Ashtabula Extrusion Plant

     The Company's former extrusion plant in Ashtabula, Ohio was used to extrude
depleted uranium under a contract with the U.S. Department of Energy ("DOE")
from 1962 through 1990. In accordance with that agreement, the DOE retained
responsibility for the cleanup of the facility when the facility was no longer
needed for processing government material. Processing ceased in 1990, and in
1993 RMI was chosen as the prime contractor for the remediation and restoration
of the site by the DOE. Since then, contaminated buildings have been removed and
approximately two-thirds of the site has been free released by the Ohio
Department of Health, to RMI, at DOE expense.

     In December, 2003, in accordance with its terms, the Department of Energy
terminated the remediation contract with RMI "for convenience." Remaining soil
removal is expected to take approximately 18-24 months. As license holder and
owner of the site, RMI is responsible to the state of Ohio for complying with
soil and water regulations. However, remaining cleanup cost is expected to be
borne by the DOE in accordance with their contractual obligation. RMI will not
participate in the remaining remediation except for oversight responsibilities
for the new remediation contractor selected by DOE.

  Gain Contingency

     As part of Boeing Commercial Airplane Group's long-term supply agreement
with the Company, Boeing was required to order a minimum of 3.25 million pounds
of titanium in each of the five years beginning in 1999. They failed to do so in
all five years of the contract.

     The Company made a claim against Boeing in accordance with the provisions
of the long-term contract for each of the years in which the minimum was not
achieved. Revenue under the provisions of Statement of Financial Accounting
Standards No. 5 ("SFAS 5"), "Accounting for Contingencies" was deemed not
realized until Boeing settled the claims. Accordingly, the claims were treated
as a gain contingency dependent upon realization.

                                        13
<PAGE>

     As a result of the application of SFAS 5 as to gain contingencies, the
Company recorded other income of approximately $6.0 million in 2000 and 2001,
and approximately $7.0 million in 2002, $8.0 million in 2003 and $9.1 million in
2004. In all years, revenue recognized from these cash receipts was presented as
other income in the financial statements. The agreement with Boeing has since
expired and the final payment was received in 2004.

  Purchase Commitments

     The Company has purchase commitments for materials, supplies, and machinery
and equipments as part of the ordinary course of business. A few of these
commitments extend beyond one year. The Company believes these commitments are
not at prices in excess of current market.

  Other

     The Company is currently investigating the impact of improper testing on a
limited number of titanium plates. The improper testing was discovered during an
internal quality review in the second quarter of 2005. The Company has no reason
to believe that any of the material is defective, and is working closely with
all affected customers to determine whether additional inspection may be
necessary. Re-inspection of plates and/or process records to date has not found
any plates that needed to be replaced or that were defective.

     The Company is also the subject of, or a party to, a number of pending or
threatened legal actions involving a variety of matters incidental to its
business.

     The ultimate resolution of these foregoing contingencies could,
individually or in the aggregate, be material to the consolidated financial
statements. However, management believes that the Company will remain a viable
and competitive enterprise even though it is possible that these matters could
be resolved unfavorably.

NOTE 13-- TRANSACTIONS WITH RELATED PARTIES

     In accordance with a stock purchase agreement dated October 1, 2004 the
Company purchased all of the shares of Claro Precision Inc., from Mr. Jean-Louis
Mourain and Mr. Daniel Molina. The purchase agreement provided for a lease
agreement whereby the Company would lease space in two buildings, owned
indirectly by Mr. Mourain and Mr. Molina, for three years from October 1, 2004
with an option to extend for an additional three years. The annual rental is
approximately $160,000 at current exchange rates. Rental expense of
approximately $40,000 was incurred in the quarter ended September 30, 2005 and
approximately $120,000 for the nine months ended September 30, 2005. The Company
believes that the rental cost is representative of market conditions around the
Montreal area. Mr. Mourain was engaged by the Company as a consultant and Mr.
Molina was made President of Claro Precision Inc. Mr. Molina has since left the
Company effective August 31, 2005.

     The Company acquired Reamet S.A., located in Villette, France, in December
2000. In accordance with the purchase agreement, the Company was obligated to
acquire a residence located on the previously acquired land. The owner of the
residence and his immediate family have been involved in the management of the
business before and since the acquisition. The residence was acquired for
$581,000 (the fair value as appraised) including closing costs in February 2004.

NOTE 14-- SEGMENT REPORTING

     The Company's reportable operating segments are the Titanium Group and the
Fabrication and Distribution Group.

     The Titanium Group manufactures and sells a wide range of titanium mill
products to a customer base consisting primarily of manufacturing and
fabrication companies in the aerospace and nonaerospace markets. Titanium mill
products consist of basic mill shapes such as ingot, slab, bloom, billet, bar,
plate and sheet. Titanium mill products are sold primarily to customers such as
metal fabricators, forge shops and, to a lesser extent, metal distribution
companies. Titanium mill products are usually raw or starting material for these
                                        14
<PAGE>

customers, who then form, fabricate or further process mill products into
finished or semi-finished components or parts. The Titanium Group includes the
activities related to the clean up and remediation of a former titanium
extrusion facility operated by the Company under a contract from the DOE.

     The Fabrication and Distribution Group is engaged primarily in the
fabrication of titanium, specialty metals and steel products, including pipe and
engineered tubular products, for use in the oil and gas and geo-thermal energy
industries; hot and superplastically formed parts; cut, forged, extruded and
rolled shapes for aerospace and nonaerospace applications. This segment also
provides warehousing, distribution, finishing, cut-to-size and just-in-time
delivery services of titanium, steel and other metal products.

     Intersegment sales are accounted for at prices which are generally
established by reference to similar transactions with unaffiliated customers.
Reportable segments are measured based on segment operating income after an
allocation of certain corporate items such as general corporate overhead and
expenses.

                                        15
<PAGE>

     Segment information for the quarter ended September 30, 2005 and 2004 and
for the nine months ended September 30, 2005 and 2004 is as follows (dollars in
thousands):

<Table>
<Caption>
                                                        QUARTER ENDED       NINE MONTHS ENDED
                                                        SEPTEMBER 30,         SEPTEMBER 30,
                                                      ------------------   -------------------
                                                        2005      2004       2005       2004
                                                      --------   -------   --------   --------
<S>                                                   <C>        <C>       <C>        <C>
TOTAL SALES
  Titanium Group....................................  $ 86,366   $37,633   $240,826   $110,374
  Fabrication and Distribution Group................    64,402    47,692    194,315    137,126
                                                      --------   -------   --------   --------
     Total..........................................   150,768    85,325    435,141    247,500
INTER- AND INTRA-SEGMENT SALES
  Titanium Group....................................    55,368    25,112    145,210     71,802
  Fabrication and Distribution Group................    14,233     9,262     40,237     22,408
                                                      --------   -------   --------   --------
     Total..........................................    69,601    34,374    185,447     94,210
TOTAL SALES TO EXTERNAL CUSTOMERS
  Titanium Group....................................    30,998    12,521     95,616     38,572
  Fabrication and Distribution Group................    50,169    38,430    154,078    114,718
                                                      --------   -------   --------   --------
     Total..........................................  $ 81,167   $50,951   $249,694   $153,290
                                                      ========   =======   ========   ========
OPERATING INCOME (LOSS)
  Allocated corporate items included in segment
     income before income taxes below:
  Titanium Group....................................  $  2,372   $   720   $  5,153   $  2,581
  Fabrication and Distribution Group................     3,782     3,591      9,912      7,552
                                                      --------   -------   --------   --------
     Total..........................................  $  6,154   $ 4,311   $ 15,065   $ 10,133
                                                      ========   =======   ========   ========
  Titanium Group....................................  $ 10,961   $  (961)  $ 29,773   $ (7,211)
  Fabrication and Distribution Group................     2,617    (1,315)    11,853       (877)
                                                      --------   -------   --------   --------
     Total..........................................  $ 13,578   $(2,276)  $ 41,626   $ (8,088)
                                                      ========   =======   ========   ========
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE
  INCOME TAXES
  Allocated corporate items included in segment
     income before income taxes below:
  Titanium Group....................................  $  2,166   $  (611)  $  4,612   $  6,843
  Fabrication and Distribution Group................     3,574    (3,669)     9,369     (7,266)
                                                      --------   -------   --------   --------
     Total..........................................  $  5,740   $(4,280)  $ 13,981   $   (423)
                                                      ========   =======   ========   ========
  Titanium Group....................................  $ 11,128   $  (776)  $ 30,424   $  2,367
  Fabrication and Distribution Group................     2,802    (1,284)    12,403       (841)
                                                      --------   -------   --------   --------
     Total..........................................  $ 13,930   $(2,060)  $ 42,827   $  1,526
                                                      ========   =======   ========   ========
</Table>

NOTE 15-- DISCONTINUED OPERATIONS

     In December 2004, the Company terminated operations at the Company's Tube
Mill operations as it had determined that its raw material source was inadequate
to maintain commercially viable operations. The

                                        16
<PAGE>

operating results of Tube Mill for the quarter and nine months ended September
30, 2004, as summarized below, have been reclassified and are presented as
discontinued operations.

<Table>
<Caption>
                                                                              NINE MONTHS
                                                             QUARTER ENDED       ENDED
                                                             SEPTEMBER 30,   SEPTEMBER 30,
(IN THOUSANDS)                                                   2004            2004
--------------                                               -------------   -------------
<S>                                                          <C>             <C>
Net sales..................................................     $2,965          $10,312
                                                                ======          =======
(Loss) income before income taxes..........................       (142)             198
(Benefit) provision for income taxes.......................        (43)              59
                                                                ------          -------
Net (loss) income from discontinued operations.............     $  (99)         $   139
                                                                ======          =======
</Table>

NOTE 16-- NEW ACCOUNTING PRONOUNCEMENTS

     In December 2004 the Financial Accounting Standards Board (FASB) issued
SFAS No. 151, Inventory Costs (SFAS 151). The Company is required to adopt SFAS
151 on a prospective basis as of January 1, 2006. SFAS 151 clarifies the
accounting for abnormal amounts of idle facility expense, freight, handling
cost, and wasted material. SFAS 151 requires that those items, if abnormal, be
recognized as expenses in the period incurred. SFAS 151 requires the allocation
of fixed production overheads to the cost of conversion based upon the normal
capacity of the production facilities. The Company has not yet determined what
effect SFAS 151 will have on its financial statements.

     In December 2004, the FASB issued FASB Staff Position No. FAS 109-2,
"Accounting and Disclosure Guidance for the Foreign Earnings Repatriation
Provision within the American Jobs Creation Act of 2004," which states that the
FASB staff believes that the lack of clarification of certain provisions within
the Act and the timing of the enactment necessitate a practical exemption to the
FAS 109 requirement to reflect in the period of enactment the effect of a new
tax law. Accordingly, an enterprise is allowed time beyond the financial
reporting period of enactment to evaluate the effect of the Act on its plan for
reinvestment or repatriation of foreign earnings for purposes of applying FAS
109. The Company is evaluating the impact of earnings repatriation and once
concluded will apply its action in accordance with FAS 109.

     In December 2004, the FASB issued Statement of Financial Accounting
Standards No. 123 (revised 2004) (SFAS 123R), Share-Based Payment. In March
2005, the SEC issued Staff Accounting Bulletin No. 107 (SAB 107) regarding the
SEC Staff's interpretation of SFAS 123R and provides the Staff's views regarding
interactions between SFAS 123R and certain SEC rules and regulations and
provides interpretations of the valuation of share-based payments for public
companies. SFAS 123R requires the mandatory expensing of share-based payments,
including employee stock options, based on their fair value. In April 2005, the
SEC approved the delay for implementation of SFAS 123R. The delay will affect
all awards granted subsequent to January 1, 2006. As a result the standard will
be adopted for the Company's 2006 fiscal year. SFAS 123R provides alternative
methods of adoption including modified prospective and modified retroactive
applications. The Company is currently evaluating the financial impact,
including the available alternatives under SFAS 123R and SAB 107.

     On December 8, 2003, the Medicare Prescription Drug, Improvement and
Modernization Act of 2003 (the Act) was signed into law. The Act introduced a
prescription drug benefit under Medicare (Medicare Part D), as well as a federal
subsidy to sponsors of retiree health care benefit plans that provide a benefit
that is at least actuarially equivalent to Medicare Part D. On May 19, 2004,
FASB issued Staff Position FSP FAS 106-2 (FSP 106-2), which supercedes FSP 106-1
and provides guidance on accounting for the effects of the new Medicare
prescription drug legislation for employers whose prescription drug benefits are
actuarially equivalent to the drug benefit under Medicare Part D. The effect of
the Act did not have a material impact on the Company.

     In May 2005, the FASB issued SFAS No. 154, "Accounting Changes and Error
Corrections" (SFAS 154), which changes the requirements for the accounting and
reporting of a change in accounting principle. SFAS 154 applies to all voluntary
changes in accounting principle as well as to changes required by

                                        17
<PAGE>

an accounting pronouncement that does not include specific transition
provisions. SFAS 154 eliminates the requirement to include the cumulative effect
of changes in accounting principle in the income statement and instead requires
that changes in accounting principle be retroactively applied. A change in
accounting estimate continues to be accounted for in the period of change and
future periods if necessary. A correction of an error continues to be reported
by restating prior period financial statements. SFAS 154 is effective for
accounting changes and correction of errors made on or after January 1, 2006.

NOTE 17--RESTATEMENT OF CASH FLOW STATEMENT FOR THE TAX EFFECTS OF STOCK OPTIONS
EXERCISED

     A restatement of the Company's Consolidated Statement of Cash Flows arose
as a result of management's determination that the tax effect of employee stock
options exercised were incorrectly reported as "cash flows from financing
activities." These should have been reported as "cash flows from operating
activities" as prescribed by Emerging Issues Task Force ("EITF") 00-15,
"Classification in the Statement of Cash Flows of the Income Tax Benefit
Received by a Company upon Exercise of Nonqualified Employee Stock Options." The
Company has restated prior periods beginning with the 4th Quarter of 2003
through the 2nd Quarter of 2005 as noted below. Amounts prior to the 4th Quarter
of 2003 were immaterial to the Company's Consolidated Statement of Cash Flows.

     The restatement does not affect the net change in cash and cash equivalents
for any of the periods presented and has no effect on the Company's consolidated
balance sheet, the consolidated statement of operations and any related earnings
per share amounts for any of the periods presented.

     The effect of the above restatement for each of the prior periods is shown:

<Table>
<Caption>
                                                AS PREVIOUSLY
                                               REPORTED FOR THE                   RESTATED FOR
                                                  YEAR ENDED                     THE YEAR ENDED
                                                 DECEMBER 31,      EFFECT OF      DECEMBER 31,
                                                     2003         RESTATEMENT         2003
                                               ----------------   -----------   ----------------
<S>                                            <C>                <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
  Tax benefits from exercise of stock
     options.................................      $     0           $ 444          $   444
  Cash provided by continuing operating
     activities..............................      $25,181           $ 444          $25,625
  Cash provided by operating activities......      $30,321           $ 444          $30,765
CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from exercise of employee stock
     options.................................      $ 1,534           $(444)         $ 1,090
  Cash provided by financing activities......      $   948           $(444)         $   504
</Table>

<Table>
<Caption>
                                              AS PREVIOUSLY
                                               REPORTED FOR                     RESTATED FOR
                                               THREE MONTHS                     THREE MONTHS
                                                  ENDED                            ENDED
                                                MARCH 31,        EFFECT OF       MARCH 31,
                                                   2004         RESTATEMENT         2004
                                             ----------------   -----------   ----------------
<S>                                          <C>                <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
  Tax benefits from exercise of stock
     options...............................       $    0           $ 620           $  620
  Cash provided by continuing operating
     activities............................       $3,119           $ 620           $3,739
  Cash provided by operating activities....       $2,907           $ 620           $3,527
CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from exercise of employee stock
     options...............................       $2,388           $(620)          $1,768
  Cash provided by financing activities....       $2,100           $(620)          $1,480
</Table>

                                        18
<PAGE>

<Table>
<Caption>
                                                 AS PREVIOUSLY
                                                 REPORTED FOR                    RESTATED FOR
                                                  SIX MONTHS                      SIX MONTHS
                                                     ENDED                           ENDED
                                                   JUNE 30,        EFFECT OF       JUNE 30,
                                                     2004         RESTATEMENT        2004
                                                ---------------   -----------   ---------------
<S>                                             <C>               <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
  Tax benefits from exercise of stock
     options..................................      $    0           $ 650          $   650
  Cash provided by continuing operating
     activities...............................      $9,524           $ 650          $10,174
  Cash provided by operating activities.......      $9,697           $ 650          $10,347
CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from exercise of employee stock
     options..................................      $2,607           $(650)         $ 1,957
  Cash provided by financing activities.......      $2,034           $(650)         $ 1,384
</Table>

<Table>
<Caption>
                                                 AS PREVIOUSLY
                                                 REPORTED FOR                   RESTATED FOR
                                                  NINE MONTHS                    NINE MONTHS
                                                     ENDED                          ENDED
                                                 SEPTEMBER 30,     EFFECT OF    SEPTEMBER 30,
                                                     2004         RESTATEMENT       2004
                                                ---------------   -----------   -------------
<S>                                             <C>               <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
  Tax benefits from exercise of stock
     options..................................      $     0          $ 766         $   766
  Cash provided by continuing operating
     activities...............................      $12,151          $ 766         $12,917
  Cash provided by operating activities.......      $13,506          $ 766         $14,272
CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from exercise of employee stock
     options..................................      $ 3,138          $(766)        $ 2,372
  Cash provided by financing activities.......      $ 2,565          $(766)        $ 1,799
</Table>

<Table>
<Caption>
                                                 AS PREVIOUSLY
                                                 REPORTED FOR                    RESTATED FOR
                                                THE YEAR ENDED                  THE YEAR ENDED
                                                 DECEMBER 31,      EFFECT OF     DECEMBER 31,
                                                     2004         RESTATEMENT        2004
                                                ---------------   -----------   ---------------
<S>                                             <C>               <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
  Tax benefits from exercise of stock
     options..................................      $     0         $ 1,336         $ 1,336
  Cash provided by continuing operating
     activities...............................      $16,413         $ 1,336         $17,749
  Cash provided by operating activities.......      $19,346         $ 1,336         $20,682
CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from exercise of employee stock
     options..................................      $ 5,359         $(1,336)        $ 4,023
  Cash provided by financing activities.......      $ 4,786         $(1,336)        $ 3,450
</Table>

<Table>
<Caption>
                                                 AS PREVIOUSLY
                                                 REPORTED FOR                   RESTATED FOR
                                                 THREE MONTHS                   THREE MONTHS
                                                     ENDED                          ENDED
                                                   MARCH 31,       EFFECT OF      MARCH 31,
                                                     2005         RESTATEMENT       2005
                                                ---------------   -----------   -------------
<S>                                             <C>               <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
  Tax benefits from exercise of stock
     options..................................      $     0         $ 1,217        $ 1,217
  Cash (used in) provided by continuing
     operating activities.....................      $(3,685)        $ 1,217        $(2,468)
  Cash (used in) provided by operating
     activities...............................      $(3,685)        $ 1,217        $(2,468)
CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from exercise of employee stock
     options..................................      $ 6,551         $(1,217)       $ 5,334
  Cash provided by financing activities.......      $ 6,068         $(1,217)       $ 4,851
</Table>

                                        19
<PAGE>

<Table>
<Caption>
                                                 AS PREVIOUSLY
                                                 REPORTED FOR                   RESTATED FOR
                                                  SIX MONTHS                     SIX MONTHS
                                                     ENDED                          ENDED
                                                   JUNE 30,        EFFECT OF      JUNE 30,
                                                     2005         RESTATEMENT       2005
                                                ---------------   -----------   -------------
<S>                                             <C>               <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
  Tax benefits from exercise of stock
     options..................................      $     0         $ 2,367        $2,367
  Cash provided by continuing operating
     activities...............................      $ 2,429         $ 2,367        $4,796
  Cash provided by operating activities.......      $ 2,429         $ 2,367        $4,796
CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from exercise of employee stock
     options..................................      $11,175         $(2,367)       $8,808
  Cash provided by financing activities.......      $10,692         $(2,367)       $8,325
</Table>

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

     The following discussion should be read in connection with the information
contained in the Consolidated Financial Statements and Condensed Notes to
Consolidated Financial Statements. The following information contains
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995, and is subject to the safe harbor created by that
Act. Such forward-looking statements may be identified by their use of words
like "expects," "anticipates," "intends," "projects," or other words of similar
meaning. Forward-looking statements are based on expectations and assumptions
regarding future events. In addition to factors discussed throughout this
report, the following factors and risks should also be considered, including,
without limitation, 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 aerospace industries,
increased defense spending, the success of new market development, long-term
supply agreements, the outcome of the Doha round of trade negotiations,
challenges to Buy American Legislation, global economic conditions, the
Company's order backlog and the conversion of that backlog into revenue, the
continuing war on terrorism, and other statements contained herein that are not
historical facts. Because such forward-looking statements involve risks and
uncertainties, there are important factors that could cause actual results to
differ materially from those expressed or implied by such forward-looking
statements. These and other risk factors are set forth below in the "Outlook"
section, as well as in the Company's other filings with the Securities and
Exchange Commission ("SEC") over the last 12 months, copies of which are
available from the SEC or may be obtained upon request from the Company.

     As discussed in Note 17 to the condensed consolidated financial statements,
the Company had incorrectly classified the tax effect of stock options exercised
in the Consolidated Statement of Cash Flows as cash provided by financing
activities under the line item proceeds from the exercise of employee stock
options. For the period ended September 30, 2005 the Company has classified the
tax effect of stock options exercised in the Consolidated Statement of Cash
Flows as cash provided from operating activities under the line item tax
benefits from exercise of stock options. The Company has restated prior periods
beginning with the 4th Quarter of 2003 through the 2nd Quarter of 2005. Amounts
prior to the 4th quarter of 2003 were immaterial to the financial statements.
The Company plans to amend its Form 10-K for the year ended December 31, 2003
and 2004, and its Forms 10-Q for the quarterly periods ended March 31, 2005, and
June 30, 2005 as soon as practicable to restate its financial statements.

     The restatement does not affect the net change in cash and cash equivalents
for any of the periods presented and has no effect on the Company's consolidated
balance sheet, the consolidated statement of operations and related earnings per
share amounts for any of the periods presented.

     RTI International Metals, Inc. (the "Company" or "RTI") is a leading U.S.
producer of titanium mill products and fabricated metal parts for the global
market. The Company conducts business in two segments: the Titanium Group and
the Fabrication and Distribution Group ("F&D"). The Titanium Group melts and
produces a complete range of titanium mill products, which are further processed
by its customers for use in a variety of aerospace and industrial applications.
The Fabrication and Distribution Group is comprised of

                                        20
<PAGE>

companies that fabricate, machine, assemble and distribute titanium and other
specialty metal parts and components. Its products, many of which are engineered
parts and assemblies, serve aerospace, oil and gas, power generation, and
chemical process industries, as well as a number of other industrial and
consumer markets.

RESULTS OF OPERATIONS
(Dollars in millions)

  NET SALES

<Table>
<Caption>
                                                              QUARTER ENDED   NINE MONTHS ENDED
                                                              SEPTEMBER 30,     SEPTEMBER 30,
                                                              -------------   -----------------
                                                              2005    2004     2005      2004
                                                              -----   -----   -------   -------
<S>                                                           <C>     <C>     <C>       <C>
Titanium Group..............................................  $31.0   $12.5   $ 95.6    $ 38.6
Fabrication and Distribution Group..........................   50.2    38.4    154.1     114.7
                                                              -----   -----   ------    ------
  Total.....................................................  $81.2   $50.9   $249.7    $153.3
                                                              =====   =====   ======    ======
</Table>

  Titanium Group

     For the quarter, trade sales of titanium mill products increased over the
prior year quarter by $18.5 million to $31.0 million. Approximately $14.0
million of the increase was a result of increased volume of 1.0 million pounds
from the prior year level of 0.8 million pounds. Approximately $2.0 million of
the increase was attributable to an increase in the average price of $1.08 per
pound to $15.04 per pound. Ferro titanium and other related metallic sales
increased by approximately $2.3 million over the corresponding quarter in the
prior year. The increase in titanium mill products was a result of continued
strong demand for titanium from aerospace markets as build rates and higher
titanium usage per aircraft created increased demand for the product.

     For the nine months ended September 30, 2005, trade sales increased by
$57.0 million to $95.6 million. Increased titanium mill products volume of 2.5
million pounds to 4.1 million pounds for the year to date increased sales by
approximately $37.5 million. A decrease in the average price per pound had an
unfavorable impact of approximately $1.0 million. Sales of ferro titanium and
other related metallics increased by approximately $22.0 million.

     In the first nine months of 2005, mill product shipments to trade customers
as well as to the Company's Fabrication and Distribution Group equaled 8.0
million pounds compared to 3.6 million pounds in the nine months of 2004 or a
change of over 120%. Of the 8.0 million pounds 4.1 million pounds was to trade
customers and of the 3.6 million pounds 1.6 million was to trade customers.

  Fabrication and Distribution Group

     Sales for F&D amounted to $50.2 million in the quarter ended September 30,
2005, compared to $38.4 million in the same period of 2004. The increase of
$11.8 million occurred primarily in the Group's domestic distribution markets.
Revenue increased approximately $8.0 million on increased demand and higher
prices for Titanium products. The addition of Claro Precision Inc. ("Claro") in
the fourth quarter of 2004 and higher revenues on the Group's fabrication
activities resulted in additional revenue of approximately $3.0 million.

     In the nine months ended September 30, 2005 sales for F&D amounted to
$154.1 million compared to $114.7 million in the same period of 2004. The
increase of $39.4 million was a result of strong demand in the group's
distribution markets both, domestic and international, as revenue increased
approximately $30.0 million on increased demand and higher prices for titanium
and specialty metal products. The addition of Claro in the fourth quarter of
2004 and higher revenues on the Group's fabrication activities resulted in
additional revenue of approximately $10.0 million offset by the effects of a
decline in the energy markets.

                                        21
<PAGE>

GROSS PROFIT (LOSS)

<Table>
<Caption>
                                                              QUARTER ENDED    NINE MONTHS ENDED
                                                              SEPTEMBER 30,      SEPTEMBER 30
                                                              --------------   -----------------
                                                               2005    2004     2005      2004
                                                              ------   -----   -------   -------
<S>                                                           <C>      <C>     <C>       <C>
Titanium Group..............................................  $14.8    $1.1     $39.6     $(0.3)
Fabrication and Distribution Group..........................   12.1     6.5      37.8      19.0
                                                              -----    ----     -----     -----
Total.......................................................  $26.9    $7.6     $77.4     $18.7
                                                              =====    ====     =====     =====
</Table>

  Titanium Group

     Gross profit increased to $14.8 million for the quarter ended September 30,
2005 from a gross profit of $1.1 million for the same period of 2004 or a
favorable change of $13.7 million. The favorable change was a result of the
margin impact of an increase in titanium mill product shipments to 1.8 million
pounds and increased average pricing of $1.08 or $2.0 million, and an $8.0
million benefit to cost efficiency from increases in melting and production
activity in titanium producing and finishing facilities. Increased revenue from
the sale of ferro titanium and related metallics contributed $3.0 million to
gross profit.

     For the nine months ending September 30, 2005 gross profit increased for
the Titanium Group from the period ending September 30, 2004 by $39.9 million
primarily as a result of volume and mix related effects. Titanium mill product
shipments increased over the prior period by 4.4 million pounds resulting in an
approximate margin effect of $12.0 million. Correspondingly, a 130% increase in
melting and finishing activities resulted in approximately $20.0 million in
improved throughput and absorption of fixed costs. Improved pricing and
shipments on ferro titanium sales resulted in an $8.0 million increase in
margins.

  Fabrication and Distribution Group

     Gross profit increased to $12.1 million for the quarter ended September 30,
2005 from a gross profit of $6.5 million for the same period of 2004, or a
favorable change of $5.6 million. Increased revenues from domestic and
international distribution markets as a result of both demand and increased
prices contributed approximately $3.0 million to the change in gross profits.
Demand for titanium and specialty metal products was generally stronger than the
year ago period in all geographic markets. Increased revenue from newly acquired
Canadian operations and increased sales from the group's fabrication locations
resulted in increased gross profits of $3.0 million.

     Gross Profit increased for the Fabrication and Distribution Group for the
nine months ended September 30, 2005 versus September 30, 2004 by $18.8 million
as revenues from domestic and international distribution markets increased as a
result of both demand and increased prices. The impact of the increased prices
and demand in distribution increased margins over the prior period by
approximately $12.0 million. Increased revenue from the group's fabrication and
extrusion sales resulted in additional gross profit of $7.0 million. Included in
the fabrication revenues was the impact of the Claro acquisition which occurred
in the fourth quarter of 2004.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

<Table>
<Caption>
                                                              QUARTER ENDED   NINE MONTHS ENDED
                                                              SEPTEMBER 30,     SEPTEMBER 30,
                                                              -------------   -----------------
                                                              2005    2004     2005      2004
                                                              -----   -----   -------   -------
<S>                                                           <C>     <C>     <C>       <C>
Titanium Group..............................................  $ 3.5   $ 2.2    $ 8.7     $ 6.6
Fabrication and Distribution Group..........................    9.4     7.8     25.9      19.8
                                                              -----   -----    -----     -----
Total.......................................................  $12.9   $10.0    $34.6     $26.4
                                                              =====   =====    =====     =====
</Table>

                                        22
<PAGE>

  Titanium Group

     Selling, general and administrative ("SG&A") expenses increased in the
third quarter of 2005 over the third quarter of 2004 by $1.3 million as
increased incentive compensation and related expenses were $0.9 million higher.
Outside audit and consulting expenses increased by $0.4 million.

     SG&A expenses increased in the first nine months of 2005 over the nine
months ending September 30, 2004 by $2.1 million as increased outside audit and
consulting expenses increased by $1.1 million. Incentive compensation and
related expenses increased by $1.0 million.

  Fabrication and Distribution Group

     SG&A expenses for the period ending September 30, 2005 increased $1.6
million from the third quarter of 2004. The acquisition of Claro resulted in
additional expenses of $1.2 million as Claro was not reflected in the third
quarter of 2004. Increased compensation and related expenses were $0.4 million.

     For the nine months ending September 30, 2005 administrative and selling
expenses increased $6.1 million from the period ending September 30, 2004. The
acquisition of Claro in late 2004 was not reflected in the year ago period
resulting in increased SG&A of $3.0 million. Increased costs for audit and
consulting expenses increased by approximately $2.0 million. Increased
compensation costs for the segment were also increased over the prior nine month
period by $1.0 million.

RESEARCH, TECHNICAL AND PRODUCT DEVELOPMENT EXPENSES

<Table>
<Caption>
                                                                 QUARTER       NINE MONTHS
                                                                  ENDED           ENDED
                                                              SEPTEMBER 30,   SEPTEMBER 30,
                                                              -------------   -------------
                                                              2005    2004    2005    2004
                                                              -----   -----   -----   -----
<S>                                                           <C>     <C>     <C>     <C>
Titanium Group..............................................  $0.3    $0.3    $1.1    $0.9
Fabrication and Distribution Group..........................   0.1      --     0.1      --
                                                              ----    ----    ----    ----
Total.......................................................  $0.4    $0.3    $1.2    $0.9
                                                              ====    ====    ====    ====
</Table>

  Titanium Group

     Research and development costs were $0.3 million for the quarter ended
September 30, 2005 unchanged from the year ago quarter in 2004.

     Research and development costs increased $0.2 million for the nine months
ended September 30, 2005 compared to the same period in 2004 as a result of
additional research and development activity in the 2005 period.

  Fabrication and Distribution Group

     Research and development costs increased $0.1 million in the current
quarter as a result of employee expenses in the company's energy projects.

OPERATING INCOME (LOSS)

<Table>
<Caption>
                                                                 QUARTER       NINE MONTHS
                                                                  ENDED           ENDED
                                                              SEPTEMBER 30,   SEPTEMBER 30,
                                                              -------------   -------------
                                                              2005    2004    2005    2004
                                                              -----   -----   -----   -----
<S>                                                           <C>     <C>     <C>     <C>
Titanium Group..............................................  $11.0   $(1.0)  $29.8   $(7.2)
Fabrication and Distribution Group..........................    2.6    (1.3)   11.8    (0.9)
                                                              -----   -----   -----   -----
Total.......................................................  $13.6   $(2.3)  $41.6   $(8.1)
                                                              =====   =====   =====   =====
</Table>

                                        23
<PAGE>

  Titanium Group

     Operating income for the quarter ended September 30, 2005 increased to
$11.0 million compared to a loss of $(1.0) million for the same period in 2004.
The increase of $12.0 million resulted from improved gross profit of $13.7
million due to an increase in shipments of 1.7 million pounds. As a result of
increased shipment activity, increased production loads and efficient throughput
at producing facilities' production costs per pound decreased over the prior
year ago period. Period costs increased over the 2004 period as a result of
additional costs for outside services for accounting, consulting and auditing
and reduced gross profits by $0.3 million. Expenses for incentive compensation
and related expenses increased $0.9 million.

     Operating income for the nine months ended September 30, 2005 increased to
$29.8 million compared to a loss of $(7.2) million for the same period in 2004.
The increase of $37.0 million resulted from improved gross profits of $39.9
million due to an increase in shipment volume of 4.4 million pounds.
Additionally, melting and production activity exceeded more than a 200% volume
change resulting in improved throughput and absorption of fixed costs. Increased
margins on ferro titanium, primarily as a result of escalating selling prices,
contributed to the increase in gross margins. Partially offsetting the effects
of volume and ferro titanium were increased administrative costs as a result of
outside services and incentive compensation.

  Fabrication and Distribution Group

     Operating income for the quarter ended September 30, 2005 increased to $2.6
million compared to a loss of $(1.3) million for the same period in 2004. The
increase of $3.9 million was primarily due to increased gross profits of $5.6
million partially offset by increased SG&A spending of $1.6 million. The
increase in gross profit occurred in the group's distribution markets as
increased revenues and margins contributed to a favorable change of
approximately $2.8 million. The addition of Claro and general improvement in the
group's fabrication markets improved gross profit by $2.4 million. SG&A
increased as a result of the Claro acquisition in the fourth quarter of 2004 not
reflected in the year ago quarter.

     Operating income for the nine months ended September 30, 2005 increased to
$11.8 million compared to a loss of $(0.9) million for the same period in 2004.
The increase of $12.7 million was primarily due to increased gross profits of
$18.8 million partially offset by increased SG&A spending of $6.1 million. The
increase in gross profit occurred as a result of increased revenues from
domestic and international distribution markets and increased revenue from
fabrication and extrusion sales. Partially offsetting the increase in gross
margin was increased SG&A spending. SG&A spending increased as a result of the
Claro acquisition which was not reflected in the prior nine month period and
additional consulting, accounting and auditing costs related to installation of
Sarbanes-Oxley 404 and information development costs to support requirements of
management. Compensation costs also increased over the prior period.

                                        24
<PAGE>

OTHER INCOME

<Table>
<Caption>
                                                              QUARTER ENDED     NINE MONTHS ENDED
                                                              SEPTEMBER 30,       SEPTEMBER 30,
                                                            -----------------   -----------------
                                                             2005      2004      2005      2004
                                                            -------   -------   -------   -------
<S>                                                         <C>       <C>       <C>       <C>
Other Income..............................................   $0.1      $0.1      $0.5      $9.5
</Table>

     Other income was unchanged from the prior year quarter at $0.1 million.
Foreign exchange gains from French and Canadian operations are included in other
income.

     Other income decreased by $9.0 million in the nine months ended September
30, 2005 from the nine months ended September 30, 2004. The decrease primarily
occurred as a result of the receipt of a payment of $9.1 million in 2004 from
Boeing related to minimum order requirements under a long term contract. Receipt
of the sum in 2004 was the final payment under the contract.

INTEREST INCOME, NET

<Table>
<Caption>
                                                              QUARTER ENDED     NINE MONTHS ENDED
                                                              SEPTEMBER 30,       SEPTEMBER 30,
                                                            -----------------   -----------------
                                                             2005      2004      2005      2004
                                                            -------   -------   -------   -------
<S>                                                         <C>       <C>       <C>       <C>
Interest Income, net......................................   $0.3      $0.1      $0.6      $0.1
</Table>

     Interest income increased by $0.2 million in the quarter ending September
30, 2005 from the quarter ended September 30, 2004. The increase was a result of
increased income on invested cash reserves at higher average interest rates.

     Interest income increased by $0.5 million in the nine months ending
September 30, 2005 from the nine months ended September 30, 2004. The increase
was a result of increased income on invested cash reserves at higher average
interest rates.

INCOME TAX EXPENSE

<Table>
<Caption>
                                                             QUARTER ENDED    NINE MONTHS ENDED
                                                             SEPTEMBER 30,      SEPTEMBER 30,
                                                            ---------------   -----------------
                                                            2005     2004      2005      2004
                                                            ----   --------   -------   -------
<S>                                                         <C>    <C>        <C>       <C>
Income Tax Expense........................................  $5.3   $     --    $15.2     $0.7
</Table>

     The increase in income tax expense in the quarter and nine months ended
September 30, 2005 over the same periods in 2004 is attributable to higher
earnings in 2005. Also in 2005, $0.7 million of tax benefits for discrete
adjustments reduced tax expense in the second quarter that are reflected in the
year to date results to recognize two separate, but related state tax
considerations: 1) an expectation that the Company will be sufficiently
profitable in future years so that it will pay the income-based tax in Ohio
rather than a franchise tax based on net-worth; and 2) an Ohio tax law change
that phases out the income tax over a five year period.

     The effective tax rate applicable to ordinary income in 2005 approximates
37%, which is higher than the federal statutory rate of 35% principally due to
state taxes, partially offset by the utilization of previously impaired foreign
net operating losses that results in reported income without a corresponding tax
charge, and the deduction for qualified production activities that permanently
reduces tax. The actual tax rates applicable to the corresponding periods in
2004 are generally not comparable with 2005 because of the lower level of pretax
income in 2004.

(LOSS)/INCOME FROM DISCONTINUED OPERATIONS

     The Company disclosed in a news release dated September 30, 2004 that its
Tube Mill operations had stopped soliciting new orders because of a shortage of
skelp from its supplier, which is the key raw material in manufacturing titanium
strip.

     The decision to halt the solicitation of new orders was to continue until a
search for other sources of skelp was concluded. In December 2004 the Company
terminated its search for other skelp sources and as a result

                                        25
<PAGE>

terminated production activity and discontinued the titanium strip product line
and utilized the facility for other purposes unrelated to the manufacture of
welded tubing. Tube Mill operations had been reported within the F&D segment.

     Discontinued operations, which represent operating results of the Tube Mill
operations for which further information was included in Note 15 to the
Consolidated Financial Statements, reported trade sales of $14.4 million, $10.5
million and $12.9 million for the years ended December 31, 2004, 2003, and 2002,
respectively.

<Table>
<Caption>
                                                              QUARTER ENDED    NINE MONTH ENDED
                                                              SEPTEMBER 30,      SEPTEMBER 30,
                                                              --------------   -----------------
                                                               2005    2004     2005      2004
                                                              ------   -----   -------   -------
<S>                                                           <C>      <C>     <C>       <C>
Discontinued operations.....................................  $   --   $(0.1)  $   --     $0.1
</Table>

NET INCOME (LOSS)

<Table>
<Caption>
                                                              QUARTER ENDED    NINE MONTHS ENDED
                                                              SEPTEMBER 30,      SEPTEMBER 30,
                                                              --------------   -----------------
                                                              2005     2004     2005      2004
                                                              -----   ------   -------   -------
<S>                                                           <C>     <C>      <C>       <C>
Net income (loss)...........................................  $8.7    $(2.2)    $27.6     $1.0
</Table>

     Net income improved by $10.9 million in the quarter ended September 30,
2005 compared to the same period in 2004. Net income represented 11% of sales in
the current period compared to a loss in 2004.

     For the nine month period ending September 30, 2005 net income improved by
$26.6 million compared to the same period in 2004. Net income represented 11.1%
of sales in the current period compared to 0.7% in 2004.

OUTLOOK

 Overview

     Aerospace applications comprise approximately 55% of worldwide consumption
and over 70% of U.S. consumption of titanium products.

     Beginning in 2001, a confluence of events including weak U.S. and global
economies, combined with the terrorist attacks of September 11, 2001, followed
by the ongoing conflicts in the Middle East, had significant adverse effects on
the overall titanium industry through 2003. Beginning in 2004 however, the world
economies began to improve, air traffic demand rose significantly in the
commercial aircraft segment, and defense spending continued to grow, leading to
a strong rebound in the demand for titanium and specialty metal products.

     According to the U.S. Geological Survey (USGS), U.S. shipments of titanium
mill products in 2004 increased to 42 million pounds from 34 million pounds in
2003. Aircraft manufacturers, as well as aerospace forecasters, have predicted
increased build rates for large, commercial aircraft production over the next
several years. This is expected to increase the demand and shipments for
titanium and specialty metals in the same period. Accordingly, the USGS reported
U.S. shipments of titanium mill products for the first half 2005 rose to 27
million pounds or an annual rate of 54 million pounds.

     The following is a discussion of what is occurring within each of the three
major markets in which RTI participates.

 Commercial Aerospace Markets

     The Company's sales to this market represented approximately 35% of total
sales in 2004, up from 27% in 2003.

     Boeing and Airbus reduced their build rates for aircraft to 586 planes in
2003, a 13.5% reduction from prior year. However, a turnaround began in 2004,
with the two major producers delivering 605 new aircraft.

                                        26
<PAGE>

According to The Airline Monitor, the combined production of large commercial
aircraft by Boeing and Airbus is forecast to reach 680 aircraft in 2005, 785
aircraft in 2006, 825 aircraft in 2007, and 880 aircraft in 2008.

     Airbus is producing the largest commercial aircraft in production, the
A380, and Boeing has launched a totally new aircraft, the 787. Airbus has
announced the launch of another new aircraft, the A350, to compete with Boeing's
787 model. All three of these new aircraft will use substantially more titanium
per aircraft than the preceding models. As a result, when production of these
new aircraft increases, the demand for titanium is expected to increase
significantly above previous peak markets for commercial aerospace applications.
Long term, the commercial aerospace sector is expected to continue to be a very
large consumer of titanium products over the next 20 years due to the forecast
growth of worldwide traffic and the need to repair and replace aging commercial
fleets.

     A long-term supply agreement with the Boeing Commercial Airplane Group
ended 2003, with the final payment received in the first quarter of 2004.
Beginning in January of 2004, business between the companies, which is not
covered by other contracts within RTI, is being conducted on a non-committed
basis, that is, no volume commitment by Boeing and no commitment of capacity or
price by RMI.

     RTI acquired Claro Precision, Inc., in October of 2004. Claro supplies
precision machining and complex sub-assemblies to the aerospace industry,
primarily Bombardier. The acquisition provides RTI with additional manufacturing
capabilities as well as access to the regional and business jet markets.

     RTI, through its RTI Europe subsidiary, entered into an agreement with the
European Aeronautic Defense and Space Company ("EADS") in January 2005 to supply
value-added titanium products and parts to the EADS group of companies,
including Airbus. The contract is in place through 2008, subject to extension.
The new Airbus A380 is expected to utilize more titanium per aircraft than any
commercial plane yet produced. In 2003, Airbus became the world's largest
producer of commercial aircraft. This continued in 2004, and this is forecast to
continue for 2005.

  Defense Markets

     Shipments to military markets represented approximately 30% of the
Company's 2004 revenues and are expected to remain significant as U.S. and other
countries' defense budgets remain strong. In fact, the latest U.S. Department of
Defense budget figures for Research, Development Testing and Evaluation (RDT&E)
and Procurement reflect an increase of 21% from 2005 through 2009.

     RTI believes it is well positioned to supply mill products and fabrications
required for projected demand from this market. RTI currently supplies titanium
and other materials to most military aerospace programs, including the F/A-22,
C-17, F/A-18, F-15, F-16, Joint Strike Fighter ("JSF") and in Europe, the
Mirage, Rafale and Eurofighter-Typhoon.

     The Company was chosen by BAE Systems RO Defence UK to supply the titanium
components for the new XM-777 lightweight 155 mm Howitzer. Delivery began late
in 2003 and will continue through 2010. Production approval for 495 units was
awarded to BAE in March 2005. Initial deliveries will be to the U.S. Marine
Corps, followed by deliveries to the U.S. Army and the Italian and British armed
forces. It is anticipated that over 1,000 guns may be produced. Sales under this
contract could potentially exceed $70 million.

     The Company entered into a new agreement with BAE Systems in January 2005
to provide value added titanium flat rolled products for the Eurofighter
Aircraft through 2009.

     Lockheed Martin, a major customer of the Company, was awarded the largest
military contract ever on October 26, 2001, for the military's $200 billion JSF
program. The aircraft, which will be used by all branches of the military, is
expected to consume up to 80,000 pounds of titanium per airplane depending on
the model specified. Timing and order patterns, which are likely to extend well
into the future for this program, have not been quantified, but may be as many
as 3,000 planes over the next 30 to 40 years. The Company has entered into
agreements with Lockheed and its teaming partner, BAE Systems, to be the
supplier of titanium sheet and plate for the design and development phase of the
program.

                                        27
<PAGE>

  Industrial and Consumer Markets

     35% of RTI's 2004 revenues were generated in various industrial and
consumer markets where increased demand is expected over the next twelve months.

     Revenues from oil and gas markets are expected to increase in 2005 and
beyond due to continued activity in deep water projects. In January 2005, RTI
Energy Systems was selected by BP to provide titanium stress joints for its Shah
Deniz project located in the Caspian Sea, Azerbaijan. Titanium was chosen
because both strength and flexibility will be needed to deal with the strong
currents in the development area. Fabrication will begin in the fourth quarter
of 2005 and shipments will be made over the next 9 months.

     RTI serves a number of other industrial and consumer markets through its
distribution businesses. The products sold and applications served are numerous
and varied. The resulting diversity tends to provide sales stability through
varying market conditions. Industry demand from these markets has improved
substantially in 2005 and is expected to grow further in 2006.

     The Company operates a facility that produces ferro-titanium, an additive
to certain grades of steel. The recent world wide demand for steel has
significantly increased demand for ferro-titanium. Sales of ferro-titanium
constituted over 10% of total sales in 2004. Strong demand continued for this
product in the first half of 2005, weakened in the third quarter and is expected
to improve somewhat in the fourth quarter.

  Backlog

     The Company's order backlog for all markets increased to approximately
$428.2 million as of September 30, 2005, up from $237.9 million at December 31,
2004, principally due to increased demand from the commercial aerospace
industry.

LIQUIDITY AND CAPITAL RESOURCES
(Dollars in millions)

     A restatement of the Company's Consolidated Statement of Cash Flows arose
as a result of management's determination that the tax effect of employee stock
options exercised were incorrectly reported as "cash flows from financing
activities." These should have been reported as "cash flows from operating
activities" as prescribed by Emerging Issues Task Force ("EITF") 00-15,
"Classification in the Statement of Cash Flows of the Income Tax Benefit
Received by a Company upon Exercise of Nonqualified Employee Stock Options." The
Company has restated prior periods beginning with the 4th Quarter of 2003
through the 2nd Quarter of 2005. Amounts prior to the 4th Quarter of 2003 were
immaterial to the Company's Consolidated Statement of Cash Flows.

     The restatement does not affect the net change in cash and cash equivalents
for any of the periods presented and has no effect on the Company's consolidated
balance sheet, the consolidated statement of operations and any related earnings
per share amounts for any of the periods presented.

     The Company believes it will generate sufficient cash flow from operations
to fund operations and capital expenditures in 2005. In addition, RTI has cash
reserves and available borrowing capacity to maintain adequate liquidity. RTI
currently has no debt, and based on the expected strength of 2005 cash flows,
the Company does not believe there are any material near-term risks related to
fluctuations in interest rates.

  Cash (used in) provided by operating activities

<Table>
<Caption>
NINE MONTHS ENDED SEPTEMBER 30,                                2005         2004
-------------------------------                               ------     ----------
                                                                         (RESTATED)
<S>                                                           <C>        <C>
Cash (used in) provided by operating activities.............  $(30.5)      $ 14.3
</Table>

     The decrease in net cash flows from operating activities for the nine
months ended September 30, 2005 compared to the nine months ended September 30,
2004 primarily reflects an increase in working capital items, primarily
receivables and inventory, due to the improved demand in all market segments as
mentioned in the "Outlook" section of this Management's Discussion and Analysis.
The overall decrease in cash flows from operating activities was a result of
inventory increases as demand for titanium products continued to increase in the
first nine months of 2005. Partially offsetting the increase in inventories was
an increase in net

                                        28
<PAGE>

income on higher sales levels and increases in accounts payable and billings in
excess of costs. In addition, the decrease in cash flows from operating
activities was impacted by a $9.0 million pension contribution and $10.7 million
in income tax payments. The decrease in cash flows from operating activities was
also partially offset from the increase in tax benefits from stock options of
$3.0 million.

     The increase in accounts payable is attributable to purchases of increased
quantities of scrap and higher prices for both scrap and sponge. Billings in
excess of costs increased primarily on two contracts for which cash had been
collected but revenue was not recognized in accordance with the Company's
revenue recognition criteria.

     The Company's working capital ratio was 5.9 and 8.2 to 1 at September 30,
2005 and December 31, 2004, respectively.

  Cash used in investing activities

<Table>
<Caption>
NINE MONTHS ENDED SEPTEMBER 30,                                2005       2004
-------------------------------                               ------   ----------
                                                                       (RESTATED)
<S>                                                           <C>      <C>
Cash used in investing activities...........................  $  7.9     $  5.8
</Table>

     Gross capital expenditures for the nine months ended September 30, 2005
amounted to $7.6 million compared to $4.2 million in 2004.

     During the nine months ended September 30, 2005 and 2004, the Company's
cash flow requirements for capital expenditures were funded with available cash
on hand. The Company anticipates that its capital expenditures for 2005 will
total approximately $13.0 million and will be funded with cash generated by
operations and available cash balances.

     At September 30, 2005 and December 31, 2004, the Company had a borrowing
capacity equal to $89.0 and $33.8 million, respectively.

  Cash provided by financing activities

<Table>
<Caption>
NINE MONTHS ENDED SEPTEMBER 30,                                2005       2004
-------------------------------                               ------   ----------
                                                                       (RESTATED)
<S>                                                           <C>      <C>
Cash provided by financing activities.......................  $ 12.9     $  1.8
</Table>

     The favorable change in cash flows from financing activities for the nine
months ended September 30, 2005 compared to the nine months ended September 30,
2004 primarily reflects an increase in proceeds from the exercise of employee
stock options of $13.4 million. Partially offsetting these cash inflows was the
purchase of approximately 22,000 shares of common stock that was reclassified to
treasury.

CREDIT AGREEMENT

     The Company amended its former $100 million, three-year credit agreement on
June 4, 2004. The amendment provides for $90 million of standby credit through
May 31, 2008. The Company has the option to increase the available credit to
$100 million with the addition of another bank, without the approval of the
existing bank group. The terms and conditions of the amended facility remain
unchanged with the exception that the tangible net worth covenant in the
replaced facility was eliminated.

     Under the terms of the facility, the Company, at its option, will be able
to borrow at (a) a base rate (which is the higher of PNC Bank's prime rate or
the Federal Funds Effective Rate plus 0.5% per annum), or (b) LIBOR plus a
spread (ranging from 1.0% to 2.25%) determined by the ratio of the Company's
consolidated total indebtedness to consolidated earnings before interest, taxes,
depreciation and amortization. The credit agreement contains restrictions, among
others, on the minimum cash flow required, and the maximum leverage ratio
permitted. At September 30, 2005, there was approximately $1.0 million of
standby letters of credit outstanding under the facility, the Company was in
compliance with all covenants, and had a borrowing capacity equal to $89.0
million.

ENVIRONMENTAL MATTERS

     The Company is subject to environmental laws and regulations as well as
various health and safety laws and regulations that are subject to frequent
modifications and revisions. During the nine months ended
                                        29
<PAGE>

September 30, 2005, the Company spent approximately $0.3 million for
environmental remediation, compliance, and related services. While the costs of
compliance for these matters have not had a material adverse impact on the
Company in the past, it is impossible to accurately predict the ultimate effect
these changing laws and regulations may have on the Company in the future. The
Company continues to evaluate its obligations for environmental related costs on
a quarterly basis and makes adjustments in accordance with provisions of
Statement of Position No. 96-1, "Environmental Remediation Liabilities."

     The Company is involved in investigative or cleanup projects under federal
or state environmental laws at a number of waste disposal sites, including the
Fields Brook Superfund Site and the Ashtabula River Area of Concern. Given the
status of the proceedings with respect to these sites, ultimate investigative
and remediation costs cannot presently be accurately predicted, but could, in
the aggregate be material. Based on the information available regarding the
current ranges of estimated remediation costs at currently active sites, and
what the Company believes will be its ultimate share of such costs, provisions
for environmental-related costs have been recorded.

     Given the status of the proceedings at certain of these sites, and the
evolving nature of environmental laws, regulations, and remediation techniques,
the Company's ultimate obligation for investigative and remediation costs cannot
be predicted. It is the Company's policy to recognize environmental costs in its
financial statements when an obligation becomes probable and a reasonable
estimate of exposure can be determined.

     At September 30, 2005, the amount accrued for future environmental-related
costs was $3.6 million. Of the total amount accrued at September 30, 2005, $1.4
million is expected to be paid out within one year and is included in the other
accrued liabilities line of the balance sheet. The remaining $2.2 million is
recorded in other non-current liabilities.

     Based on available information, RMI believes that its share of potential
environmental-related costs, before expected contributions from third parties,
is in a range from $2.3 to $7.5 million in the aggregate. The Company has
included in its other noncurrent assets $2.1 million as expected contributions
from third parties. These third parties include prior owners of RMI property and
prior customers of RMI, that have agreed to partially reimburse the Company for
certain environmental-related costs. The Company has been receiving
contributions from such third parties for a number of years as partial
reimbursement for costs incurred by the Company.

     As these proceedings continue toward final resolution, amounts in excess of
those already provided may be necessary to discharge the Company from its
obligations for these sites.

  Former Ashtabula Extrusion Plant

     The Company's former extrusion plant in Ashtabula, Ohio was used to extrude
depleted uranium under a contract with the DOE from 1962 through 1990. In
accordance with that agreement, the DOE retained responsibility for the cleanup
of the facility when the facility was no longer needed for processing government
material. Processing ceased in 1990, and in 1993 RMI was chosen as the prime
contractor for the remediation and restoration of the site by the DOE. Since
then, contaminated buildings have been removed and approximately two-thirds of
the site has been free released by the Ohio Department of Health, to RMI, at DOE
expense.

     In December, 2003, in accordance with its terms, the Department of Energy
terminated the contract "for convenience." It is not known at this time what
role, if any, RMI will play in the balance of the cleanup although discussions
are ongoing. Remaining soil removal is expected to take approximately 18-24
months. As license holder and owner of the site, RMI is responsible to the state
of Ohio for complying with soil and water regulations. However, remaining
cleanup cost is expected to be borne by the DOE in accordance with their
contractual obligation. RMI will not participate in the remaining remediation
except for oversight responsibilities for the new remediation contractor
selected by DOE.

                                        30
<PAGE>

EMPLOYEES

     As of September 30, 2005, the Company and its subsidiaries employed 1,229
persons, 395 of whom were classified as administrative and sales personnel. 605
of the total number of employees were in the Titanium Group, while 624 were
employed in the Fabrication & Distribution Group.

     The United Steelworkers of America represents 306 of the hourly, clerical
and technical employees at RMI's plant in Niles, Ohio and 1 hourly employee at
RMI Environmental Services in Ashtabula, Ohio. No other Company employees are
represented by a union.

NEW ACCOUNTING STANDARDS

     In December 2004 the Financial Accounting Standards Board (FASB) issued
SFAS No. 151, Inventory Costs. The Company is required to adopt SFAS 151 on a
prospective basis as of January 1, 2006. SFAS 151 clarifies the accounting for
abnormal amounts of idle facility expense, freight, handling cost, and wasted
material. SFAS 151 requires that those items--if abnormal--be recognized as
expenses in the period incurred. SFAS 151 requires the allocation of fixed
production overheads to the cost of conversion based upon the normal capacity of
the production facilities. The Company has not yet determined what effect SFAS
151 will have on its financial statements.

     In December 2004, the FASB issued FASB Staff Position No. FAS 109-2,
"Accounting and Disclosure Guidance for the Foreign Earnings Repatriation
Provision within the American Jobs Creation Act of 2004," which states that the
FASB staff believes that the lack of clarification of certain provisions within
the Act and the timing of the enactment necessitate a practical exemption to the
FAS 109 requirement to reflect in the period of enactment the effect of a new
tax law. Accordingly, an enterprise is allowed time beyond the financial
reporting period of enactment to evaluate the effect of the Act on its plan for
reinvestment or repatriation of foreign earnings for purposes of applying FAS
109. The Company is evaluating the impact of earnings repatriation and once
concluded will apply its action in accordance with FAS 109.

     In December 2004, the FASB issued Statement of Financial Accounting
Standards No. 123 (revised 2004) (SFAS 123R), Share-Based Payment. In March
2005, the SEC issued Staff Accounting Bulletin No. 107 (SAB 107) regarding the
SEC Staff's interpretation of SFAS 123R and provides the Staff's views regarding
interactions between SFAS 123R and certain SEC rules and regulations and
provides interpretations of the valuation of share-based payments for public
companies. SFAS 123R requires the mandatory expensing of share-based payments,
including employee stock options, based on their fair value. In April 2005, the
FASB delayed mandatory implementation for fiscal years beginning after December
15, 2005. As a result the standard will be adopted for the Company's 2006 fiscal
year. SFAS 123R provides alternative methods of adoption including modified
prospective and modified retroactive applications. The Company is currently
evaluating the financial impact, including the available alternatives under SFAS
123R and SAB 107.

     On December 8, 2003, the Medicare Prescription Drug, Improvement and
Modernization Act of 2003 (the Act) was signed into law. The Act introduced a
prescription drug benefit under Medicare (Medicare Part D), as well as a federal
subsidy to sponsors of retiree health care benefit plans that provide a benefit
that is at least actuarially equivalent to Medicare Part D. On May 19, 2004,
FASB issued Staff Position FSP FAS 106-2 (FSP 106-2), which supercedes FSP 106-1
and provides guidance on accounting for the effects of the new Medicare
prescription drug legislation for employers whose prescription drug benefits are
actuarially equivalent to the drug benefit under Medicare Part D. The effect of
the Act did not have a material impact on the Company.

     In May 2005, the FASB issued SFAS No. 154, "Accounting Changes and Error
Corrections" (SFAS 154), which changes the requirements for the accounting and
reporting of a change in accounting principle. SFAS 154 applies to all voluntary
changes in accounting principle as well as to changes required by an accounting
pronouncement that does not include specific transition provisions. SFAS 154
eliminates the requirement to include the cumulative effect of changes in
accounting principle in the income statement and instead requires that changes
in accounting principle be retroactively applied. A change in accounting
estimate continues to be accounted for in the period of change and future
periods if necessary. A correction of an error continues to be reported by
restating prior period financial statements. SFAS 154 is effective for
accounting changes and correction of errors made on or after January 1, 2006.
                                        31
<PAGE>

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     There have been no significant changes to the Company's exposure to market
risk since the Company filed its Form 10-K, as amended, on May 9, 2005.

ITEM 4.  CONTROLS AND PROCEDURES

  (a)  Evaluation of Disclosure Controls and Procedures

     The Company's management, with the participation of the Chief Executive
Officer and Chief Administrative Officer, evaluated the effectiveness of the
Company's disclosure controls and procedures (as defined in Exchange Act Rules
13a-15(e) and 15d-15(e)) as of the end of the period covered by this quarterly
report on Form 10-Q. Based upon that evaluation they have concluded that the
Company's disclosure controls and procedures are not effective in ensuring that
all material information required to be filed in reports that the Company files
with the Securities and Exchange Commission is recorded, processed, summarized
and reported within the time periods specified in the rules and forms of the
Commission because of material weaknesses in its internal control over financial
reporting as discussed in the Company's Form 10-K as amended on May 9, 2005.

     The evaluation of our disclosure controls and procedures by our Chief
Executive Officer and Chief Administrative Officer included a review of the
restatement described in Note 17 on page 18 of this Form 10-Q, where the Company
restated its consolidated statement of cash flows for periods ended December 31
2003 through June 30, 2005, including all interim periods. Management has
determined that the restatement is an additional effect of the material
weaknesses already described in the Form 10-K as amended on May 9, 2005.
Accordingly, the restatement does not affect our previous conclusion stated in
our report on internal control over financial reporting in that Form 10-K, as
amended.

     In light of material weaknesses described in the Form 10-K as amended, and
the effect of the Company's restatement, management continues to perform
additional analysis and other post-closing procedures to ensure the Condensed
Consolidated Financial Statements are prepared in accordance with generally
accepted accounting principles. Accordingly, management believes that the
interim financial statements included in this report fairly present in all
material respects the financial condition, results of operations and cash flows
for the period presented.

  (b)  Changes in Internal Control over Financial Reporting

     The Company initiated a remediation program to address the material
weaknesses identified and reported in its Form 10-K as amended on May 9, 2005.
During the period since that filing the Company has performed:

     - An examination of control design at all significant locations for 2005.
       The Company's internal audit group along with outside audit resources
       performed the examination.

     - Testing of installation of a new SAP fixed asset system.

     - Hired a Vice President and Chief Accounting Officer.

     - Hired a SEC Coordinator

     - Continued work on the installation of a new financial reporting
       consolidation accounting system.

     - Formed work teams of accounting and operating management personnel to
       provide instruction and guidance relative to improvements in internal
       control.

     - Added two accounting managers, hired a director of taxation and hired a
       controller for one of the Company's international locations.

     - Reorganized the Company's accounting functions to provide additional
       competencies and supervisory review.

     - Reviewed the effectiveness of the design of internal controls over
       footnote and disclosure spreadsheets.

     - Provided additional training on the requirements for internal control
       over financial reporting including a company wide conference for head
       accounting personnel and business unit level presentations for process
       owners.

                                        32
<PAGE>

     - Formed a Steering Committee, consisting of executive management, to
       oversee the Company's remediation and compliance efforts.

     - Continued to expand its SAP network by continuing to install an SAP
       system at one of its international locations.

     The Company had previously reported in its Form 10-Q for the quarter ended
June 30, 2005 that it had replaced the Director of Corporate Accounting and
Consolidation. Additionally it had reported:

     - It had reduced the number of SAP users with unrestricted access.

     - Directed the Company's internal audit department to concentrate on
       examination, evaluation and testing of material weaknesses.

     Until the Company completes its evaluation and testing of its controls, the
Company has:

     - Re-tested certain material internal control weaknesses that existed at
       December 31, 2004 to determine their effectiveness in the current quarter
       and performed additional substantive testing to become reasonably assured
       that the interim financial statements were materially correct.

     - Taken steps in the quarter to include a thorough review of the
       classification requirements of each component line item, and the
       individual elements that comprise each line item, of the statement of
       cash flows to remediate its previously disclosed material weaknesses in
       financial reporting.

     - Performed substantive testing for certain transactions to ensure their
       accuracy and compliance with GAAP.

     - Enhanced review of critical transactions and balances to ensure their
       accuracy.

     - Changed third-party payroll processors to those that have issued Type II
       SAS 70 reports in prior years.

     The Company is unable to conclude that its internal controls over financial
reporting were effective as of September 30, 2005. The Company intends to
evaluate many of its controls for effectiveness in the fourth quarter 2005.

                                        33
<PAGE>

                           PART II--OTHER INFORMATION

ITEM 2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

     Issuer Purchases of Equity Securities:

<Table>
<Caption>
                                                                                           APPROXIMATE
                                                                     TOTAL NUMBER          DOLLAR VALUE
                                           TOTAL                  OF SHARES PURCHASED   OF SHARES THAT MAY
                                          NUMBER      AVERAGE         AS PART OF         YET BE PURCHASED
                                         OF SHARES   PRICE PAID   PUBLICLY ANNOUNCED    UNDER THE PLANS OR
PERIOD                                   PURCHASED   PER SHARE     PLANS OR PROGRAMS         PROGRAMS
------                                   ---------   ----------   -------------------   ------------------
<S>                                      <C>         <C>          <C>                   <C>
Balance at June 30, 2005...............   22,458       $21.50           22,458             $10,610,799
July 1, 2005 - September 30, 2005......       --          n/a               --
                                          ------                        ------             -----------
Total..................................   22,458                        22,458             $10,610,799
                                          ======                        ======             ===========
</Table>

     The RTI International Metals, Inc. share repurchase program was approved by
RTI's Board of Directors on April 30, 1999. The program authorizes the
repurchase of up to 15 million dollars of RTI common stock from time to time.
There is no expiration date specified for the stock buyback program. There were
no repurchases made during the quarter ended September 30, 2005.

ITEM 5.  OTHER INFORMATION

     As the Company previously reported, William T. Hull was newly appointed as
the Vice President & Chief Accounting Officer of the Company on August 1, 2005.
In connection with such appointment, Mr. Hull entered into an indemnification
agreement with the Company on November 9, 2005 in the form set forth in Exhibit
10.1 to this Form 10-Q.

     The indemnification agreement, which is identical to those in place with
the Company's executive officers and directors, provides, in summary, that the
Company shall indemnify Mr. Hull against any and all expenses, including
attorneys fees, judgments, fines and amounts paid in settlements, incurred as a
result of threatened, pending or completed legal actions in which he is a party
as a result of actions or inactions taken in his official capacity on behalf of
the Company. The contractual indemnification is subject to the statutory
provisions of the laws of the State of Ohio where the Company is incorporated,
and excludes from indemnification any remuneration that is in violation of law,
and further excludes any act or omission undertaken by an officer or director
with deliberate intent to cause injury to the Company or with reckless disregard
for the best interests of the Company.

ITEM 6.  EXHIBITS

<Table>
<Caption>
  EXHIBIT
   NUMBER                              DESCRIPTION
  -------                              -----------
<S>            <C>
    10.1       Form of indemnification agreement.
    10.2       Pay philosophy and guiding principles covering officer
               compensation.
    31.1       Certification pursuant to Exchange Act Rules 13a-14 and
               15d-14.
    31.2       Certification pursuant to Exchange Act Rules 13a-14 and
               15d-14.
    32.1       Certification pursuant to 18 U.S.C. Section 1350, as adopted
               pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
    32.2       Certification pursuant to 18 U.S.C. Section 1350, as adopted
               pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
</Table>

                                        34
<PAGE>

                                   SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                          RTI INTERNATIONAL METALS, INC.
                                          --------------------------------------
                                                       (Registrant)

Date: November 14, 2005

                                          By:      /s/ WILLIAM T. HULL
                                            ------------------------------------
                                                      William T. Hull
                                             Vice President & Chief Accounting
                                                           Officer

                                        35