SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

 X    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
---   EXCHANGE ACT OF 1934

                For the quarterly period ended September 30, 2003

                                       OR

      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
---   EXCHANGE ACT OF 1934


                         Commission file number 0-28538



                           Titanium Metals Corporation
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)


            Delaware                                           13-5630895
----------------------------------                       -----------------------
 (State or other jurisdiction of                             (IRS Employer
  incorporation or organization)                           Identification No.)



                1999 Broadway, Suite 4300, Denver, Colorado 80202
               ---------------------------------------------------
               (Address of principal executive offices) (Zip Code)


       Registrant's telephone number, including area code: (303) 296-5600
                                                           ---------------

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,  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       No   X
                                     ---       ---


Number of shares of common stock outstanding on November 4, 2003: 3,180,062

<PAGE>












Forward-Looking Information

     The statements  contained in this Quarterly Report on Form 10-Q ("Quarterly
Report")  that  are  not  historical  facts,  including,  but  not  limited  to,
statements  found  in the  Notes to  Consolidated  Financial  Statements  and in
Management's  Discussion  and  Analysis of  Financial  Condition  and Results of
Operations ("MD&A"), are forward-looking  statements that represent management's
beliefs   and   assumptions   based   on   currently   available    information.
Forward-looking  statements can generally be identified by the use of words such
as  "believes,"   "intends,"   "may,"  "will,"   "looks,"   "should,"   "could,"
"anticipates,"   "expects"  or  comparable  terminology  or  by  discussions  of
strategies  or trends.  Although  the  Company  believes  that the  expectations
reflected in such forward-looking  statements are reasonable, it cannot give any
assurance that these  expectations will prove to be correct.  Such statements by
their  nature   involve   substantial   risks  and   uncertainties   that  could
significantly  affect  expected  results.  Actual  future  results  could differ
materially  from those  described in such  forward-looking  statements,  and the
Company   disclaims  any  intention  or  obligation  to  update  or  revise  any
forward-looking  statements,  whether  as a result  of new  information,  future
events or otherwise. Among the factors that could cause actual results to differ
materially are the risks and  uncertainties  discussed in this Quarterly Report,
including risks and  uncertainties in those portions  referenced above and those
described  from time to time in the Company's  other filings with the Securities
and  Exchange  Commission  ("SEC")  which  include,  but are not limited to, the
cyclicality of the commercial  aerospace industry,  the performance of aerospace
manufacturers and the Company under their long-term  agreements,  the renewal of
certain long-term agreements,  the difficulty in forecasting demand for titanium
products,  global economic and political conditions,  global productive capacity
for  titanium,  changes in product  pricing and costs,  the impact of  long-term
contracts with vendors or the Company's  ability to reduce or increase supply or
achieve lower costs,  the  possibility  of labor  disruptions,  fluctuations  in
currency exchange rates,  control by certain stockholders and possible conflicts
of interest,  uncertainties associated with new product development,  the supply
of raw materials and services, changes in raw material and other operating costs
(including  energy costs),  possible  disruption of business or increases in the
cost of doing business resulting from terrorist  activities or global conflicts,
the  Company's  ability to achieve  reductions  in its cost  structure and other
risks and  uncertainties.  Should one or more of these risks materialize (or the
consequences of such a development worsen), or should the underlying assumptions
prove incorrect, actual results could differ materially from those forecasted or
expected.



<PAGE>



                           TITANIUM METALS CORPORATION

                                      INDEX


                                                                           Page
                                                                          Number

PART I.  FINANCIAL INFORMATION

   Item 1.  Consolidated Financial Statements

            Consolidated Balance Sheets - September 30, 2003 (unaudited)
              and December 31, 2002                                           2

            Consolidated Statements of Operations - Three and
              nine months ended September 30, 2003 and 2002 (unaudited)       4

            Consolidated Statements of Comprehensive Loss - Three
              and nine months ended September 30, 2003 and 2002 (unaudited)   6

            Consolidated Statements of Cash Flows - Nine months ended
              September 30, 2003 and 2002 (unaudited)                         7

            Consolidated Statement of Changes in Stockholders' Equity -
              Nine months ended September 30, 2003 (unaudited)                9

            Notes to Consolidated Financial Statements (unaudited)           10

   Item 2.  Management's Discussion and Analysis of Financial
              Condition and Results of Operations                            21

   Item 3.  Quantitative and Qualitative Disclosures about Market Risk       32

   Item 4.  Controls and Procedures                                          32

PART II. OTHER INFORMATION

   Item 1.  Legal Proceedings                                                33

   Item 6.  Exhibits and Reports on Form 8-K                                 33


                                      - 1 -

<PAGE>


                           TITANIUM METALS CORPORATION

                           CONSOLIDATED BALANCE SHEETS
                                 (In thousands)
<TABLE>

                                                                               September 30,           December 31,
ASSETS                                                                             2003                    2002
                                                                            --------------------     ------------------
                                                                                (unaudited)
<S>                                                                         <C>                      <C>
Current assets:
   Cash and cash equivalents                                                $          29,914        $         6,214
   Accounts and other receivables, less allowance
     of $2,496 and $2,859, respectively                                                66,480                 66,393
   Receivable from related parties                                                      1,774                  2,398
   Refundable income taxes                                                              1,219                  1,703
   Inventories                                                                        162,397                181,932
   Prepaid expenses and other                                                           4,446                  3,077
   Deferred income taxes                                                                  812                    809
                                                                            --------------------     ------------------

       Total current assets                                                           267,042                262,526

Investment in joint ventures                                                           22,325                 22,287
Property and equipment, net                                                           235,449                254,672
Intangible assets, net                                                                  7,185                  8,442
Other                                                                                  16,295                 15,851
                                                                            --------------------     ------------------

       Total assets                                                         $         548,296        $       563,778
                                                                            ====================     ==================

</TABLE>

           See accompanying Notes to Consolidated Financial Statements
                                      - 2 -


<PAGE>


                           TITANIUM METALS CORPORATION

                     CONSOLIDATED BALANCE SHEETS (CONTINUED)
                      (In thousands, except per share data)

<TABLE>

                                                                                September 30,            December 31,
LIABILITIES, MINORITY INTEREST AND                                                   2003                    2002
STOCKHOLDERS' EQUITY                                                         ---------------------    -------------------
                                                                                  (unaudited)

<S>                                                                          <C>                      <C>
Current liabilities:
   Notes payable                                                             $             864        $         12,994
   Current maturities of long-term debt and capital
     lease obligations                                                                     569                     642
   Accounts payable                                                                     27,778                  26,460
   Accrued liabilities                                                                  48,013                  46,511
   Customer advances                                                                    14,707                   5,416
   Payable to related parties                                                              257                     602
                                                                             ---------------------    -------------------

       Total current liabilities                                                        92,188                  92,625

Long-term debt                                                                               -                   6,401
Capital lease obligations                                                                9,160                   9,575
Payable to related parties                                                                 644                     644
Accrued OPEB cost                                                                       13,135                  13,417
Accrued pension cost                                                                    59,856                  61,080
Accrued environmental cost                                                               3,716                   3,531
Deferred income taxes                                                                      784                   1,036
Accrued dividends on BUCS                                                               14,854                   4,462
Other                                                                                      986                       -
                                                                             ---------------------    -------------------

       Total liabilities                                                               195,323                 192,771
                                                                             ---------------------    -------------------

Minority interest - Company-obligated mandatorily
   redeemable convertible preferred securities of subsidiary
   trust holding solely subordinated debt securities ("BUCS")                          201,241                 201,241
Other minority interest                                                                  9,843                  10,416

Stockholders' equity:
   Preferred stock, $.01 par value; 100 shares authorized,
     none issued                                                                             -                       -
   Common stock, $.01 par value; 9,900 shares authorized,
     3,191 and 3,194 shares issued                                                          32                      32
   Additional paid-in capital                                                          350,713                 350,889
   Accumulated deficit                                                                (150,299)               (127,371)
   Accumulated other comprehensive loss                                                (57,257)                (62,737)
   Treasury stock, at cost (9 shares)                                                   (1,208)                 (1,208)
   Deferred compensation                                                                   (92)                   (255)
                                                                             ---------------------    -------------------
       Total stockholders' equity                                                      141,889                 159,350
                                                                             ---------------------    -------------------

       Total liabilities and stockholders' equity                            $         548,296        $        563,778
                                                                             =====================    ===================

Commitments and contingencies (Note 14)

</TABLE>

           See accompanying Notes to Consolidated Financial Statements
                                      - 3 -

<PAGE>


                           TITANIUM METALS CORPORATION

                CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
                      (In thousands, except per share data)
<TABLE>

                                                          Three months ended                  Nine months ended
                                                            September 30,                        September 30,
                                                    -------------------------------    -----------------------------------
                                                         2003              2002              2003               2002
                                                    --------------    -------------    ---------------   -----------------

<S>                                                 <C>               <C>              <C>               <C>
Net sales                                           $     83,635      $     82,794     $    284,741      $       281,529
Cost of sales                                             83,677            87,734          279,407              279,937
                                                    --------------    -------------    ---------------   -----------------

   Gross margin                                              (42)           (4,940)           5,334                1,592

Selling, general, administrative and
   development expense                                     8,538            10,714           28,016               32,508
Equity in (losses) earnings of
   joint ventures                                            (93)              342              321                1,670
Other income (expense), net                                9,940            10,946           13,476               13,155
                                                    --------------    -------------    ---------------   -----------------

   Operating income (loss)                                 1,267            (4,366)          (8,885)             (16,091)

Interest expense                                             328               915            1,504                2,388
Other non-operating
   income (expense), net                                    (116)             (846)            (904)             (29,203)
                                                    --------------    -------------    ---------------   -----------------

   Income (loss) before income taxes,
     minority interest and cumulative
     effect of change in accounting
     principles                                              823            (6,127)         (11,293)             (47,682)

Income tax expense (benefit)                                 326              (473)             807               (1,312)
Minority interest - BUCS                                   3,521             3,333           10,391                9,999
Other minority interest, net of tax                          (38)              161              246                1,206
                                                    --------------    -------------    ---------------   -----------------

   Loss before cumulative effect of
     change in accounting principles                      (2,986)           (9,148)         (22,737)             (57,575)

Cumulative effect of change in
   accounting principles                                       -                 -             (191)             (44,310)
                                                    --------------    -------------    ---------------   -----------------

   Net loss                                         $     (2,986)     $     (9,148)    $    (22,928)     $      (101,885)
                                                    ==============    =============    ===============   =================

</TABLE>


           See accompanying Notes to Consolidated Financial Statements
                                      - 4 -

<PAGE>


                           TITANIUM METALS CORPORATION

          CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) (CONTINUED)
                      (In thousands, except per share data)
<TABLE>

                                                          Three months ended                  Nine months ended
                                                             September 30,                      September 30,
                                                    -------------------------------    --------------------------------
                                                         2003             2002              2003              2002
                                                    --------------    -------------    --------------    --------------

<S>                                                 <C>               <C>              <C>               <C>
Basic and diluted loss per share:
   Before cumulative effect of change in
     accounting principles                          $     (0.94)      $     (2.89)     $     (7.18)      $     (18.23)

   Cumulative effect of change in
     accounting principles                                    -                 -            (0.06)            (14.03)
                                                    --------------    -------------    --------------    --------------

Basic and diluted loss per share                    $     (0.94)      $     (2.89)     $     (7.24)      $     (32.26)
                                                    ==============    =============    ==============    ==============

Weighted average shares outstanding                       3,172             3,161            3,168              3,159
                                                    ==============    =============    ==============    ==============

Pro forma amounts assuming
   Statement of Financial Accounting
   Standards No. 143 was applied
   during all periods affected (Note 1):

   Net loss                                         $    (2,986)      $    (9,156)     $   (22,737)      $   (101,910)
                                                    ==============    =============    ==============    ==============

   Basic and diluted loss per share                 $     (0.94)      $     (2.90)     $     (7.18)      $     (32.26)
                                                    ==============    =============    ==============    ==============
</TABLE>

           See accompanying Notes to Consolidated Financial Statements
                                      - 5 -
<PAGE>


                           TITANIUM METALS CORPORATION

            CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (unaudited)
                                 (In thousands)
<TABLE>

                                                          Three months ended                  Nine months ended
                                                            September 30,                       September 30,
                                                    -------------------------------    ---------------------------------
                                                         2003              2002             2003               2002
                                                    --------------    -------------    --------------    ---------------

<S>                                                 <C>               <C>              <C>               <C>
Net loss                                            $     (2,986)     $    (9,148)     $    (22,928)     $    (101,885)

Other comprehensive income (loss) -
   currency translation adjustment                           741            1,546             5,480              9,112
                                                    --------------    -------------    --------------    ---------------

Comprehensive loss                                  $     (2,245)     $    (7,602)     $    (17,448)     $     (92,773)
                                                    ==============    =============    ==============    ===============

</TABLE>

           See accompanying Notes to Consolidated Financial Statements
                                      - 6 -

<PAGE>


                           TITANIUM METALS CORPORATION

                CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
                                 (In thousands)

<TABLE>

                                                                                   Nine months ended September 30,
                                                                                 -------------------------------------
                                                                                       2003                2002
                                                                                 -----------------    ----------------

<S>                                                                              <C>                  <C>
Cash flows from operating activities:
   Net loss                                                                      $      (22,928)      $     (101,885)
   Depreciation and amortization                                                         28,344               27,623
   Cumulative effect of change in accounting principles                                     191               44,310
   Noncash impairment of investment in Special Metals
     Corporation preferred securities                                                         -               27,500
   Equity in earnings of joint ventures, net of distributions                               926                 (641)
   Deferred income taxes                                                                   (203)              (2,813)
   Other minority interest                                                                  246                1,206
   Other, net                                                                               683                1,682
   Change in assets and liabilities:
     Receivables                                                                            469               12,970
     Inventories                                                                         22,915                 (704)
     Prepaid expenses and other                                                          (1,318)               5,038
     Accounts payable and accrued liabilities                                             2,424              (14,315)
     Customer advances                                                                   11,095              (16,639)
     Income taxes                                                                           550               (1,427)
     Accounts with related parties, net                                                     273                1,184
     Accrued OPEB and pension costs                                                      (2,962)              (2,150)
     Accrued dividends on BUCS                                                           10,391                    -
     Other, net                                                                            (491)                 411
                                                                                 -----------------    ----------------

       Net cash provided (used) by operating activities                                  50,605              (18,650)
                                                                                 -----------------    ----------------

Cash flows from investing activities:
   Capital expenditures                                                                  (5,984)              (4,765)
   Other                                                                                     36                    -
                                                                                 -----------------    ----------------

       Net cash used by investing activities                                             (5,948)              (4,765)
                                                                                 -----------------    ----------------

Cash flows from financing activities:
   Indebtedness:
     Borrowings                                                                         353,380              307,613
     Repayments                                                                        (371,839)            (301,877)
   Dividends paid to minority interest                                                   (1,892)              (1,115)
   Other, net                                                                              (770)                (471)
                                                                                 -----------------    ----------------

       Net cash (used) provided by financing activities                                 (21,121)               4,150
                                                                                 -----------------    ----------------

       Net cash provided (used) by operating,
         investing and financing activities                                      $       23,536       $      (19,265)
                                                                                 =================    ================

</TABLE>

           See accompanying Notes to Consolidated Financial Statements
                                      - 7 -
<PAGE>


                           TITANIUM METALS CORPORATION

          CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) (CONTINUED)
                                 (In thousands)

<TABLE>
                                                                                            Nine months ended
                                                                                               September 30,
                                                                                 -------------------------------------
                                                                                       2003                 2002
                                                                                 -----------------    ----------------
<S>                                                                              <C>                  <C>
Cash and cash equivalents:
   Net increase (decrease) from:
     Operating, investing and financing activities                               $       23,536       $      (19,265)
     Currency translation                                                                   164                 (673)
                                                                                 -----------------    ----------------
                                                                                         23,700              (19,938)
   Cash at beginning of period                                                            6,214               24,500
                                                                                 -----------------    ----------------

   Cash at end of period                                                         $       29,914       $        4,562
                                                                                 =================    ================

Supplemental disclosures:
   Cash paid for:
     Interest, net of amounts capitalized                                        $          954       $        1,462
     BUCS dividends                                                              $            -       $        9,999
     Income taxes, net                                                           $          463       $        2,928


   Noncash investing and financing activities:==
     Capital lease obligations incurred when the Company
     entered into certain leases for new equipment                               $            -       $          779

</TABLE>

           See accompanying Notes to Consolidated Financial Statements
                                      - 8 -
<PAGE>


                           TITANIUM METALS CORPORATION

      CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (unaudited)

<TABLE>

                      Nine months ended September 30, 2003
                                 (In thousands)


                                                                            Accumulated Other
                                                                            Comprehensive Loss
                                                  Additional              ----------------------                           Total
                                 Common   Common   Paid-In   Accumulated  Currency    Pension    Treasury    Deferred  Stockholders'
                                 Shares   Stock    Capital     Deficit   Translation Liabilities   Stock   Compensation   Equity
                                --------  ------  ----------  ----------  ---------  ----------  ---------  ----------  ----------

<S>                               <C>     <C>     <C>         <C>         <C>        <C>         <C>        <C>         <C>
Balance at December 31, 2002      3,185   $  32   $ 350,889   $(127,371)  $ (1,036)  $ (61,701)  $ (1,208)  $    (255)  $ 159,350

Components of comprehensive
   loss:
     Net loss                         -       -           -     (22,928)         -           -          -           -     (22,928)
     Change in cumulative
       currency translation
       adjustment                     -       -           -           -      5,480           -          -           -       5,480

Issuance of common stock              3       -          72           -          -           -          -           -          72

Stock award cancellations            (6)      -        (248)          -          -           -          -         248           -

Amortization of deferred
   compensation, net of effects
   of stock award cancellations       -       -           -           -          -           -          -         (85)        (85)
                                --------  ------  ----------  ----------  ---------  ----------  ---------  ----------  ----------

Balance at September 30, 2003     3,182   $  32   $ 350,713   $(150,299)  $  4,444   $ (61,701)  $ (1,208)  $     (92)  $ 141,889
                                ========  ======  ==========  ==========  =========  ==========  =========  ==========  ==========

</TABLE>

           See accompanying Notes to Consolidated Financial Statements
                                      - 9 -

<PAGE>

                           TITANIUM METALS CORPORATION

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Note 1 - Organization and basis of presentation

     Titanium Metals Corporation  ("TIMET") is a vertically  integrated producer
of  titanium  sponge,  melted  products  and a  variety  of  mill  products  for
aerospace,  industrial and other  applications.  The  accompanying  Consolidated
Financial  Statements  include  the  accounts  of TIMET  and its  majority-owned
subsidiaries   (collectively,   the   "Company").   All  material   intercompany
transactions and balances have been eliminated.  The Consolidated  Balance Sheet
at  September  30,  2003  and  the   Consolidated   Statements  of   Operations,
Comprehensive  Loss,  Changes  in  Stockholders'  Equity  and Cash Flows for the
interim  periods ended  September 30, 2003 and 2002,  as  applicable,  have been
prepared  by the  Company  without  audit.  In the  opinion of  management,  all
adjustments  necessary to present fairly the  consolidated  financial  position,
results of operations  and cash flows have been made.  The results of operations
for interim periods are not necessarily indicative of the operating results of a
full  year or of  future  operations.  Certain  prior  year  amounts  have  been
reclassified to conform to the current year  presentation.  Certain  information
and footnote  disclosures  normally included in financial statements prepared in
accordance with generally accepted accounting  principles have been condensed or
omitted.  The accompanying  Consolidated  Financial Statements should be read in
conjunction with the Consolidated Financial Statements included in the Company's
Annual  Report on Form 10-K for the year  ended  December  31,  2002 (the  "2002
Annual Report").

     At  September  30,  2003,  Valhi,  Inc.  and  subsidiaries  ("Valhi")  held
approximately  40.8% of TIMET's  outstanding common stock and approximately 0.4%
of the Company's  outstanding  BUCS. At September 30, 2003, the Combined  Master
Retirement  Trust  ("CMRT"),  a trust  formed by Valhi to permit the  collective
investment by trusts that maintain the assets of certain  employee benefit plans
adopted by Valhi and certain related companies, held approximately 9% of TIMET's
common  stock.  TIMET's U.S.  pension  plans began  investing in the CMRT in the
second  quarter of 2003;  however,  these plans  invest only in a portion of the
CMRT that does not hold TIMET  common  stock.  At September  30,  2003,  Contran
Corporation  ("Contran")  held  directly an  additional  42.2% of the  Company's
outstanding BUCS and held, directly or through  subsidiaries,  approximately 90%
of Valhi's outstanding common stock.  Substantially all of Contran's outstanding
voting stock is held by trusts  established for the benefit of certain  children
and grandchildren of Harold C. Simmons, of which Mr. Simmons is sole trustee. In
addition,  Mr. Simmons is the sole trustee of the CMRT and a member of the trust
investment  committee for the CMRT. Mr. Simmons may be deemed to control each of
Contran, Valhi and TIMET.

     The  Company  completed a reverse  split of its common  stock (one share of
post-split  common stock for each  outstanding  ten shares of  pre-split  common
stock)  effective after the close of trading on February 14, 2003. All share and
per share  disclosures for all periods  presented in the Consolidated  Financial
Statements  and Notes  thereto have been  adjusted to give effect to the reverse
stock split.

                                     - 10 -

<PAGE>


     The Company adopted Statement of Financial  Accounting  Standards  ("SFAS")
No. 143,  Accounting for Asset Retirement  Obligations on January 1, 2003. Under
SFAS No. 143, the fair value of a liability for an asset  retirement  obligation
covered under the scope of SFAS No. 143 is recognized in the period in which the
liability is incurred, with an offsetting increase in the carrying amount of the
related  long-lived  asset.  Over time,  the liability is accreted to its future
value,  and the  capitalized  cost is  depreciated  over the useful  life of the
related asset.  Upon  settlement of the liability,  an entity either settles the
obligation for its recorded amount or incurs a gain or loss upon settlement.

     Under the transition provisions of SFAS No. 143, the Company recognized (i)
an asset retirement cost capitalized as an increase to the carrying value of its
property,  plant and equipment of approximately  $0.2 million,  (ii) accumulated
depreciation on such capitalized cost of approximately $0.1 million and (iii) an
other noncurrent liability for the asset retirement  obligation of approximately
$0.3 million.  Amounts  resulting  from the initial  application of SFAS No. 143
were  measured  using  information,  assumptions  and  interest  rates all as of
January 1, 2003. The amount recognized as the asset retirement cost was measured
as of  the  date  the  asset  retirement  obligation  was  incurred.  Cumulative
accretion on the asset retirement obligation and accumulated depreciation on the
asset  retirement  cost were  recognized  for the time  period from the date the
asset  retirement  cost  and  liability  would  have  been  recognized  had  the
provisions  of SFAS  No.  143 been in  effect  at the  date  the  liability  was
incurred,  through  January 1, 2003.  The  difference  between the amounts to be
recognized  as described  above and any  associated  amounts  recognized  in the
Company's  balance sheet as of December 31, 2002 was  recognized as a cumulative
effect of a change in  accounting  principle  as of January  1, 2003.  The asset
retirement  obligation  recognized  as a result of adopting SFAS No. 143 relates
primarily to landfill closure and leasehold restoration costs.

     The following table shows pro forma amounts relating to the Company's asset
retirement  obligations as if SFAS No. 143 were applied throughout 2002, as well
as a roll forward of the asset retirement obligation through September 30, 2003:

<TABLE>


                                                                                (In thousands)

             <S>                                                                  <C>
             Asset retirement obligation, 1/1/2002                                $      312
             Accretion expense                                                            15
                                                                                ---------------

             Asset retirement obligation, 12/31/2002                                     327
             New obligation                                                               69
             Accretion expense                                                            14
                                                                                ---------------

             Asset retirement obligation, 9/30/2003                               $      410
                                                                                ===============
</TABLE>

Accretion  expense  during  the  first  nine  months  of 2003 is  reported  as a
component of other operating expense.

     The Company has elected the disclosure  alternative  prescribed by SFAS No.
123,  Accounting  for  Stock-Based  Compensation,  as amended  by SFAS No.  148,
Accounting for  Stock-Based  Compensation - Transition and  Disclosure,  and has
chosen to account for its  stock-based  employee  compensation  related to stock
options in accordance with Accounting  Principles  Board ("APB") Opinion No. 25,
Accounting for Stock Issued to Employees, and its various interpretations. Under
APB Opinion No. 25,  compensation  cost is generally  recognized for fixed stock
options  for  which the  exercise  price is less  than the  market  price of the
underlying stock on the grant date. The Company  recognized no compensation cost
for fixed stock  options  during the three and nine months ended  September  30,
2003 and 2002.

                                     - 11 -

<PAGE>


     The following  table  illustrates the effect on net loss and loss per share
if the Company had applied  the fair value  recognition  provisions  of SFAS No.
123:

<TABLE>

                                                        Three months ended                Nine months ended
                                                           September 30,                     September 30,
                                                  ------------------------------    --------------------------------
                                                       2003             2002             2003              2002
                                                  --------------    ------------    --------------   ---------------
                                                                (In thousands, except per share data)

<S>                                               <C>               <C>             <C>              <C>
Net loss, as reported                             $     (2,986)     $    (9,148)    $    (22,928)    $   (101,885)
Less total option related stock-based
  employee compensation expense
  determined under SFAS No. 123                            (45)            (109)            (186)            (442)
                                                  --------------    ------------    --------------   ---------------

Pro forma net loss                                $     (3,031)     $    (9,257)    $    (23,114)    $   (102,327)
                                                  ==============    ============    ==============   ===============

Basic and diluted loss per share:
  As reported                                     $      (0.94)     $     (2.89)    $      (7.24)    $     (32.26)
                                                  ==============    ============    ==============   ===============

  Pro forma                                       $      (0.96)     $     (2.93)    $      (7.30)    $     (32.40)
                                                  ==============    ============    ==============   ===============

</TABLE>

     In January 2003, the Financial  Accounting  Standards Board ("FASB") issued
FASB Interpretation ("FIN") No. 46, Consolidation of Variable Interest Entities.
The Company is required to comply with the consolidation requirements of FIN No.
46, as amended,  as of December 31,  2003.  The Company is still  studying  this
interpretation, and the FASB staff continues to provide implementation guidance.
TIMET Capital Trust I (the  "Trust"),  a  wholly-owned  subsidiary of TIMET that
issued the  Company's  BUCS,  is a variable  interest  entity that would require
consolidation  under FIN No. 46. TIMET is the primary  beneficiary  of the Trust
and has consolidated the Trust since its formation,  as the Company owns 100% of
the  Trust's  outstanding  voting  securities.  See the 2002  Annual  Report for
further  discussion of the Trust. The Company is still evaluating whether it has
involvement with any other variable interest  entities and, if applicable,  will
apply the consolidation provisions of the Interpretation to those entities as of
December 31, 2003. It is possible that VALTIMET SAS ("VALTIMET"), a manufacturer
of welded  stainless  steel and titanium tubing in which the Company has a 43.7%
equity investment,  may be determined to be a variable interest entity.  TIMET's
maximum  exposure to loss in VALTIMET is the recorded  value of its  investment,
which was $22.1 million at September 30, 2003.


                                     - 12 -

<PAGE>


Note 2 - Business segment information

     The  Company's  production  facilities  are  located in the United  States,
United  Kingdom,  France and Italy,  and its  products are sold  throughout  the
world. The Company's worldwide  integrated  activities are conducted through its
"Titanium  melted and mill  products"  segment,  currently  the  Company's  only
segment. Sales, gross margin, operating income (loss), inventory and receivables
are the key  management  measures  used to  evaluate  segment  performance.  The
following  table  provides  supplemental  segment  information  to the Company's
Consolidated Financial Statements:

<TABLE>

                                                           Three months ended                 Nine months ended
                                                              September 30,                      September 30,
                                                     -------------------------------    -------------------------------
                                                          2003             2002              2003             2002
                                                     -------------    --------------    --------------   --------------
                                                                ($ in thousands, except selling price data)

<S>                                                  <C>              <C>               <C>               <C>
Titanium melted and mill products:
   Mill product net sales                            $     65,185     $     62,656      $    208,646      $   212,940
   Melted product net sales                                12,261            8,656            41,300           27,951

   Other product sales                                     12,989           11,482            41,595           40,638
   Other (1)                                               (6,800)               -            (6,800)               -
                                                     -------------    --------------    --------------   --------------

                                                     $     83,635     $     82,794      $    284,741      $   281,529
                                                     =============    ==============    ==============   ==============

Mill product shipments:
   Volume (metric tons)                                     2,015            2,005             6,510            6,825
   Average price ($ per kilogram)                    $      32.35     $      31.25      $      32.05      $     31.20

Melted product shipments:
   Volume (metric tons)                                     1,220              625             3,500            1,895
   Average price ($ per kilogram)                    $      10.05     $      13.85      $      11.80      $     14.75

<FN>
-----------------------------------------------------------------------------------------------------------------------
(1) Represents the effect of a $6.8 million  reduction to sales during the third
quarter of 2003 related to  termination  of a purchase and sale  agreement  with
Wyman-Gordon Company ("Wyman-Gordon"). See further discussion in Note 8.
</FN>

</TABLE>

Note 3 - Inventories

<TABLE>

                                                                                September 30,          December 31,
                                                                                    2003                   2002
                                                                            --------------------    ------------------
                                                                                           (In thousands)

<S>                                                                         <C>                     <C>
Raw materials                                                               $          36,977       $        52,825
Work-in-process                                                                        75,745                82,190
Finished products                                                                      62,067                63,458
Supplies                                                                               13,479                13,829
                                                                            --------------------    ------------------
                                                                                      188,268               212,302
Less adjustment of certain inventories to LIFO basis                                   25,871                30,370
                                                                            --------------------    ------------------

                                                                            $         162,397       $       181,932
                                                                            ====================    ==================

</TABLE>

                                     - 13 -
<PAGE>


Note 4 - Preferred securities of Special Metal Corporation ("SMC")

     As previously  disclosed in the 2002 Annual Report,  in March 2002, SMC and
its U.S.  subsidiaries  filed a  voluntary  petition  for  reorganization  under
Chapter 11 of the U.S.  Bankruptcy Code. As a result,  the Company  undertook an
assessment of its investment in SMC with the assistance of an external valuation
specialist and recorded a $27.5 million impairment charge to other non-operating
expense during the first quarter of 2002 for an other than temporary  decline in
the  estimated  fair value of its  investment  in SMC.  This charge  reduced the
Company's carrying amount of its investment in the SMC securities to zero. Under
the  terms of SMC's  Second  Amended  Joint  Plan of  Reorganization,  which was
confirmed by the Bankruptcy  Court on September 29, 2003, the Company  currently
believes that it will not recover any material amount from this investment.

Note 5 - Property and equipment

<TABLE>

                                                                               September 30,           December 31,
                                                                                   2003                   2002
                                                                           ---------------------    ------------------
                                                                                         (In thousands)

<S>                                                                        <C>                      <C>
Land                                                                       $           6,288        $         6,224
Buildings                                                                             39,745                 38,874
Information technology systems                                                        58,435                 58,217
Manufacturing and other                                                              308,278                312,163
Construction in progress                                                               5,091                  3,493
                                                                           ---------------------    ------------------
                                                                                     417,837                418,971
Less accumulated depreciation                                                        182,388                164,299
                                                                           ---------------------    ------------------

                                                                           $         235,449        $       254,672
                                                                           =====================    ==================
</TABLE>

Note 6 - Goodwill

     On January 1, 2002,  the Company  adopted SFAS No. 142,  Goodwill and Other
Intangible  Assets.  Under SFAS No. 142,  goodwill is no longer  amortized  on a
periodic  basis,  but  instead is subject  to a two-step  impairment  test to be
performed on at least an annual  basis.  As a result of the adoption of SFAS No.
142,  the  Company  recorded  a  non-cash  goodwill  impairment  charge of $44.3
million,  representing the entire balance of the Company's  recorded goodwill at
January 1, 2002.  Pursuant to the transition  requirements of SFAS No. 142, this
charge was reported in the Company's  Consolidated  Statement of Operations as a
cumulative effect of a change in accounting principle as of January 1, 2002.

Note 7 - Other noncurrent assets
<TABLE>

                                                                                September 30,          December 31,
                                                                                    2003                  2002
                                                                            --------------------    ------------------
                                                                                           (In thousands)

<S>                                                                         <C>                     <C>
Deferred financing costs                                                    $         7,732         $         8,244
Prepaid pension cost                                                                  8,268                   7,295
Notes receivable from officers                                                          146                     163
Other                                                                                   149                     149
                                                                            --------------------    ------------------

                                                                            $        16,295         $        15,851
                                                                            ====================    ==================
</TABLE>

                                     - 14 -

<PAGE>


Note 8 - Accrued liabilities
<TABLE>

                                                                              September 30,           December 31,
                                                                                   2003                   2002
                                                                           ---------------------    ------------------
                                                                                           (In thousands)

<S>                                                                        <C>                      <C>
OPEB cost                                                                  $           3,669        $         3,818
Pension cost                                                                           8,320                  7,969
Payroll and vacation                                                                   6,946                  6,007
Incentive compensation                                                                   513                  1,326
Other employee benefits                                                                9,060                 11,141
Deferred income                                                                        1,511                  1,679
Environmental costs                                                                      301                    803
Accrued tungsten costs                                                                   500                  2,190
Taxes, other than income                                                               4,126                  3,519
Wyman-Gordon installments                                                              4,800                      -
Other                                                                                  8,267                  8,059
                                                                           ---------------------    ------------------

                                                                           $          48,013        $        46,511
                                                                           =====================    ==================
</TABLE>

     During the third quarter of 2003,  the Company and  Wyman-Gordon  agreed to
terminate the 1998 purchase and sale agreement  associated with the formation of
the titanium  castings joint venture  previously  owned by the two parties.  The
Company agreed to pay  Wyman-Gordon  a total of $6.8 million in three  quarterly
installments in connection with this termination, which included the termination
of certain favorable  purchase terms. The Company recorded a one-time charge for
the entire $6.8  million as a reduction  to sales in the third  quarter of 2003.
The Company paid the first  installment of $2.0 million to  Wyman-Gordon  in the
third quarter of 2003,  with the remaining two  installments of $2.0 million and
$2.8  million due in the fourth  quarter of 2003 and the first  quarter of 2004,
respectively.

     Also during the third quarter of 2003, the Company  reduced its accrual for
potential  claims  related  to  the  tungsten   inclusion  matter.  See  further
discussion in Note 14.

Note 9 - Boeing advance

     Under the terms of the amended  long-term  agreement  ("LTA") between TIMET
and The  Boeing  Company  ("Boeing"),  in years  2002  through  2007,  Boeing is
required  to  advance  TIMET  $28.5  million  annually  less  $3.80 per pound of
titanium  product  purchased  by Boeing  subcontractors  from  TIMET  during the
preceding year. The advance relates to Boeing's  take-or-pay  obligations  under
the LTA.  Effectively,  the Company collects $3.80 less from Boeing than the LTA
selling  price for each pound of titanium  product  sold  directly to Boeing and
reduces the related  customer  advance  recorded by the  Company.  For  titanium
products  sold to  Boeing  subcontractors,  the  Company  collects  the full LTA
selling  price,  but gives  Boeing  credit by reducing  the next  year's  annual
advance by $3.80 per pound of titanium  product  sold to Boeing  subcontractors.
The Boeing customer advance is also reduced as take-or-pay  benefits are earned.
As of  September  30, 2003,  approximately  $11.9  million of customer  advances
related to the Company's LTA with Boeing.

                                     - 15 -

<PAGE>


Note 10 - Notes payable, long-term debt and capital lease obligations

<TABLE>

                                                                                September 30,          December 31,
                                                                                    2003                   2002
                                                                            --------------------    ------------------
                                                                                           (In thousands)
<S>                                                                         <C>                     <C>
Notes payable:
  U.S. credit agreement                                                     $                -      $        11,944
  European credit agreements                                                               864                1,050
                                                                            --------------------    ------------------

                                                                            $              864      $        12,994
                                                                            ====================    ==================
Long-term debt:
  U.K. bank credit agreement                                                $                -      $         6,401
                                                                            ====================    ==================

Capital lease obligations                                                   $            9,729      $        10,217
  Less current maturities                                                                  569                  642
                                                                            --------------------    ------------------

                                                                            $            9,160      $         9,575
                                                                            ====================    ==================
</TABLE>

     During the second  quarter of 2003,  TIMET UK received an  interest-bearing
intercompany  loan from a U.S.  subsidiary of the Company  enabling  TIMET UK to
reduce its long-term borrowings under its U.K. bank credit agreement to zero. As
of September 30, 2003, the Company had aggregate unused  borrowing  availability
under its U.S. and European credit facilities of approximately $133 million.

Note 11 - Minority interests

     In October 2002, the Company  exercised its right to defer future  dividend
payments on its BUCS for a period of up to 20  consecutive  quarters,  effective
beginning  with the  Company's  December  1, 2002  scheduled  dividend  payment.
Dividends  continue  to accrue at the coupon  rate on the  principal  and unpaid
dividends. Based on this deferral, accrued dividends on these BUCS are reflected
as long-term  liabilities  in the  Consolidated  Balance  Sheets.  Dividends are
reported in the Consolidated Statements of Operations as minority interest.

     TIMET  Savoie,  S.A.  ("TIMET  Savoie"),  the  Company's  70% owned  French
subsidiary,  paid dividends during the second quarter of 2003 and 2002, of which
$1.9 million and $1.1 million,  respectively, was paid to Compagnie Europeene du
Zirconium ("CEZUS"), the 30% minority owner in TIMET Savoie.

                                     - 16 -

<PAGE>


Note 12 - Other income (expense)

<TABLE>
                                                         Three months ended                 Nine months ended
                                                            September 30,                      September 30,
                                                    -------------------------------    -------------------------------
                                                         2003             2002              2003              2002
                                                    --------------   --------------    --------------    -------------
                                                                              (In thousands)

<S>                                                 <C>              <C>               <C>               <C>
Other operating income (expense):
  Boeing take-or-pay                                $     10,123     $     10,540      $     12,943      $     12,696
  Litigation settlement                                        -                -               475                 -
  Other, net                                                (183)             406                58               459
                                                    --------------   --------------    --------------    -------------

                                                    $      9,940     $     10,946      $     13,476      $     13,155
                                                    ==============   ==============    ==============    =============

Other non-operating income (expense):
  Interest income                                   $         74     $         16      $        255      $        105
  Impairment of investment in SMC
    preferred securities                                       -                -                 -           (27,500)
  Foreign exchange gain (loss)                               240               50              (647)             (292)
  Surety bond guarantee                                      (50)            (918)              (50)             (918)
  Other, net                                                (380)               6              (462)             (598)
                                                    --------------   --------------    --------------    -------------

                                                    $       (116)    $       (846)     $       (904)     $    (29,203)
                                                    ==============   ==============    ==============    =============

</TABLE>


     During the first quarter of 2003, the Company received $0.5 million related
to its settlement of certain  litigation  relating to power outages  suffered at
its  Henderson,  Nevada  facility  in 1997 and 1998 as a  result  of  contractor
activity. See Note 9 for further discussion of the Boeing take-or-pay income.

Note 13 - Income taxes

<TABLE>
                                                                                Nine months ended September 30,
                                                                          --------------------------------------------
                                                                                  2003                    2002
                                                                          ---------------------    -------------------
                                                                                        (In thousands)

<S>                                                                       <C>                      <C>
Expected income tax benefit, at 35%                                       $          (3,953)       $         (16,689)
Non-U.S. tax rates                                                                      537                      823
U.S. state income taxes, net                                                              5                      186
Dividends received deduction                                                           (312)                       -
Extraterritorial income exclusion                                                      (123)                    (280)
Change in valuation allowance:
  Effect of change in tax law                                                             -                   (1,797)
  Adjustment of deferred tax valuation allowance                                      4,690                   16,367
Other, net                                                                              (37)                      78
                                                                          ---------------------    -------------------

                                                                          $             807        $          (1,312)
                                                                          =====================    ===================
</TABLE>

     During the first  quarter of 2002,  the Job Creation and Worker  Assistance
Act of 2002 (the "JCWA Act") was signed  into law.  The  Company  benefits  from
provisions of the JCWA Act  liberalizing  certain net operating loss ("NOL") and
alternative  minimum  tax  ("AMT")  restrictions.   As  a  result,  the  Company
recognized $1.8 million of refundable U.S. income taxes during the first quarter
of 2002. The Company  received $0.8 million of this refund in the fourth quarter
of 2002 and the remaining $1.0 million during the third quarter of 2003.

                                     - 17 -

<PAGE>

     At  September  30,  2003,  the Company  had,  for U.S.  federal  income tax
purposes,  NOL  carryforwards of approximately  $138 million that expire between
2020 and 2023. At September 30, 2003,  the Company had AMT credit  carryforwards
of  approximately  $4 million,  which can be utilized to offset  regular  income
taxes payable in future  years.  The AMT credit  carryforward  has an indefinite
carryforward  period. At September 30, 2003, the Company had the equivalent of a
$26  million  NOL  carryforward  in the  United  Kingdom  and a $2  million  NOL
carryforward in Germany, both of which have indefinite carryforward periods.

Note 14 - Commitments and contingencies

     Environmental  matters. As previously  disclosed in the 2002 Annual Report,
TIMET and Basic Management,  Inc. ("BMI") reached an agreement in 1999 that upon
payment by BMI of the cost to design,  purchase and install the  technology  and
equipment  necessary to allow the Company to stop  discharging  liquid and solid
effluents and co-products  into settling ponds located on certain lands owned by
the  Company  adjacent  to its  Henderson,  Nevada  plant site (the  "TIMET Pond
Property"),  the Company would convey to BMI, at no additional  cost,  the TIMET
Pond  Property.  Under  this  agreement,  BMI will pay 100% of the  first  $15.9
million of the cost for this project,  and TIMET agreed to contribute 50% of the
cost in excess of $15.9 million, up to a maximum payment by TIMET of $2 million.
The  Company  presently  expects  that the total cost of this  project  will not
exceed $15.9 million. The Company and BMI are continuing  discussions about this
project and also continuing  investigation with respect to certain environmental
issues associated with the TIMET Pond Property,  including possible  groundwater
issues.

     The  Company is also  continuing  assessment  work with  respect to its own
active plant site in Henderson, Nevada. During 2000, an initial study of certain
groundwater   remediation   issues  at  the  Company's   plant  site  and  other
Company-owned  sites within the BMI Complex was completed.  The Company  accrued
$3.3 million in 2000 based on the  undiscounted  cost estimates set forth in the
initial  study.  During  2002,  the  Company  updated  this study and accrued an
additional  $0.3 million based on revised cost  estimates.  The Company  expects
these accrued expenses to be paid over a period of up to thirty years.

     As of  September  30,  2003,  the  Company  had  accrued  an  aggregate  of
approximately $4.0 million for environmental matters,  including those discussed
above.  The Company records  liabilities  related to  environmental  remediation
obligations when estimated  future costs are probable and reasonably  estimable.
Such  accruals  are  adjusted  as  further   information  becomes  available  or
circumstances change. Estimated future costs are not discounted to their present
value. It is not possible to estimate the range of costs for certain sites.  The
imposition of more stringent  standards or requirements under environmental laws
or  regulations,  the results of future  testing and analysis  undertaken by the
Company at its  operating  facilities,  or a  determination  that the Company is
potentially  responsible for the release of hazardous substances at other sites,
could  result in costs in excess of amounts  currently  estimated to be required
for such  matters.  No assurance  can be given that actual costs will not exceed
accrued  amounts or that costs will not be incurred  with respect to sites as to
which no problem is currently  known or where no estimate can presently be made.
Further,  there can be no assurance that additional  environmental  matters will
not arise in the future.

                                     - 18 -

<PAGE>


     Legal  proceedings.  The  Company  records  liabilities  related  to  legal
proceedings  when estimated  costs are probable and reasonably  estimable.  Such
accruals are adjusted as further  information becomes available or circumstances
change.  Estimated future costs are not discounted to their present value. It is
not  possible to estimate the range of costs for certain  matters.  No assurance
can be given that  actual  costs will not exceed  accrued  amounts or that costs
will not be incurred with respect to matters as to which no problem is currently
known or where no  estimate  can  presently  be made.  Further,  there can be no
assurance that additional legal proceedings will not arise in the future.

     Other.   TIMET  is  the  primary  obligor  on  two  $1.5  million  workers'
compensation  bonds  issued  on  behalf of a former  subsidiary,  Freedom  Forge
Corporation ("Freedom Forge"), which TIMET sold in 1989. The bonds were provided
as part of the conditions  imposed on Freedom Forge in order to self-insure  its
workers' compensation obligations. Freedom Forge filed for Chapter 11 bankruptcy
protection on July 13, 2001, and discontinued payment on the underlying workers'
compensation  claims in November 2001.  During 2002, TIMET received notices that
the issuers of the bonds were required to make payments on one of the bonds with
respect to certain of these claims and were requesting reimbursement from TIMET.
Based upon loss  projections,  the  Company  accrued  $0.9  million in the third
quarter  of 2002  and  $0.7  million  (including  $0.1  million  in  legal  fees
reimbursable  to the issuer of the bonds) in the fourth quarter of 2002 for this
bond as other  non-operating  expense in 2002. Through September 30, 2003, TIMET
has  reimbursed the issuer  approximately  $0.7 million under this bond and $0.9
million remains accrued for future payments.  During 2003, TIMET received notice
that  certain  claimants  had  submitted  claims  under the second  bond.  As of
September  30,  2003,  payments  under the  second  bond  have been  immaterial;
however,  the  Company  expects  to  make  additional  payments  in the  future.
Accordingly,  the Company accrued  $50,000 for this bond as other  non-operating
expense in the third quarter of 2003.  TIMET may revise its estimated  liability
under  these  bonds in the future as  additional  facts  become  known or claims
develop.

     As of September 30, 2003, the Company has $0.5 million  accrued for pending
and potential  future  customer claims  associated  with certain  standard grade
material  produced  by the  Company  which  was  subsequently  found to  contain
tungsten  inclusions  as a result of tungsten  contaminated  silicon sold to the
Company by a third-party  supplier.  Pending claims are being  investigated  and
negotiated,  and the Company  believes that certain  claims are without merit or
can be  settled  for less than the  amount of the  original  claim.  There is no
assurance that all potential  claims have been  submitted to the Company.  Based
upon an analysis of information  pertaining to asserted and  unasserted  claims,
the Company  revised its  estimate of probable  loss and reduced its accrual for
pending and future customer claims to $0.5 million,  resulting in a $1.7 million
reduction  in cost of sales  during the third  quarter of 2003.  The Company has
filed suit seeking full recovery from its silicon supplier for any liability the
Company has incurred or might incur, although no assurance can be given that the
Company will  ultimately  be able to recover all or any portion of such amounts.
In April 2003, the Company  received notice that this silicon supplier had filed
a voluntary petition for reorganization  under Chapter 11 of the U.S. Bankruptcy
Code. TIMET is currently  investigating what effect, if any, this bankruptcy may
have on the  Company's  potential  recovery.  The Company has not  recorded  any
recoveries related to this matter as of September 30, 2003.

                                     - 19 -

<PAGE>


     The Company is involved in various employment,  environmental,  contractual
and other claims,  disputes and litigation  incidental to its business including
those discussed above. While management,  including internal counsel,  currently
believes that the outcome of these matters,  individually  and in the aggregate,
will not have a material  adverse  effect on the Company's  financial  position,
liquidity  or overall  trends in results of  operations,  all such  matters  are
subject to inherent  uncertainties.  If an unfavorable  outcome were to occur in
any given period, it is possible that it could have a material adverse impact on
the results of operations or cash flows in that particular period.

     See the 2002 Annual Report for additional  information  concerning  certain
legal and environmental matters, commitments and contingencies.

Note 15 - Earnings (loss) per share

     Basic earnings (loss) per share is based on the weighted  average number of
unrestricted  common shares  outstanding  during each period.  Diluted  earnings
(loss)  per  share  reflects  the  dilutive  effect  of  common  stock  options,
restricted stock and the assumed  conversion of the BUCS. The assumed conversion
of the BUCS was omitted  from the  diluted  loss per share  calculation  for the
three and nine months ended  September  30, 2003 and 2002 because the effect was
antidilutive. Had the BUCS not been antidilutive, diluted losses would have been
decreased by $3.5 million and $10.4  million for the three and nine months ended
September 30, 2003, respectively,  and by $3.3 million and $10.0 million for the
three and nine months ended  September 30, 2002,  respectively.  Diluted average
shares outstanding would have been increased by 540,000 shares for each of these
periods from the assumed  conversion of the BUCS.  Stock options and  restricted
shares excluded from the calculation because they were antidilutive approximated
132,000 for the three and nine months ended  September  30, 2003 and 154,000 for
the three and nine months ended September 30, 2002.


                                     - 20 -

<PAGE>


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

RESULTS OF OPERATIONS

     The following table summarizes certain information  regarding the Company's
results of operations for the three and nine months ended September 30, 2003 and
2002. The 2003 percentage change  information  represents  changes from the 2002
periods  to the  corresponding  2003  periods,  and the 2002  percentage  change
information  represents  changes from the 2001 periods to the corresponding 2002
periods.  See  "Outlook"  for  further  discussion  of  the  Company's  business
expectations for the remainder of 2003.

<TABLE>
                                                          Three months ended                 Nine months ended
                                                            September 30,                      September 30,
                                                    -------------------------------    -------------------------------
                                                        2003              2002             2003             2002
                                                    --------------    -------------    --------------   --------------
                                                           ($ in thousands)                   ($ in thousands)

<S>                                                 <C>               <C>              <C>              <C>
Net sales                                           $     83,635      $     82,794     $    284,741     $    281,529
Gross margin                                                 (42)           (4,940)           5,334            1,592
Operating income (loss)                                    1,267            (4,366)          (8,885)         (16,091)

Gross margin percent of net sales                              0%               -6%               2%               1%

Percentage change in:
   Sales volume:
     Mill product sales volume                                 -               -33               -5              -26
     Melted product sales volume                             +95               -54              +85              -45

   Average selling prices - includes
    changes in product mix:
       Mill products                                          +4                +3               +3               +5
       Melted products                                       -27                -6              -20               +3

   Selling prices - excludes changes
    in product mix:
       Mill products in U.S. dollars                          -2                +2               -2               +5
       Mill products in billing currencies(1)                 -5                -1               -7               +4
       Melted products                                       -20                -5              -15               +2
<FN>
----------------------------------------------------------------------------------------------------------------------
(1) Excludes the effect of changes in foreign currencies.
</FN>

</TABLE>


     Third  quarter of 2003  compared to third  quarter of 2002.  The  Company's
sales of mill products  increased 4% from $62.7 million during the third quarter
2002 to $65.2  million  during the third  quarter  of 2003.  This  increase  was
principally  due to a 0.5% increase in mill product sales volume,  a 4% increase
in mill product  average  selling  prices (using actual  product mix and foreign
currency  exchange  rates  prevailing  during the  respective  periods)  and the
effects of the  weakening  of the U.S.  dollar  compared  to the  British  pound
sterling  and the euro.  In billing  currencies  (which  exclude  the effects of
foreign currency  translation),  mill product selling prices decreased 5% during
the third quarter of 2003 compared to the year ago period.  Mill product selling
prices expressed in U.S.  dollars (using actual foreign currency  exchange rates
prevailing during the respective  periods) decreased 2% during the third quarter
of 2003 compared to the third quarter of 2002.

                                     - 21 -
<PAGE>


     Melted  product  sales  increased  42% from $8.7  million  during the third
quarter of 2002 to $12.3 million  during the third quarter of 2003 primarily due
to a 95% increase in melted  product  sales  volume,  partially  offset by a 27%
decrease in melted product average selling  prices.  Melted products  consist of
ingot and slab and are generally only sold in U.S. dollars. Melted product sales
increased principally as a result of new customer relationships, share gains and
changes  in  product  mix,  including  a  significant  sale of slab in the third
quarter of 2003. Excluding the effects of changes in product mix, melted product
selling  prices  decreased  20% during the third quarter of 2003 compared to the
third quarter of 2002.

     Net sales  during the third  quarter of 2003 were  reduced by $6.8  million
related to a one-time charge incurred by the Company to terminate a purchase and
sale  agreement  between  the  Company  and  Wyman-Gordon.  See  Note  8 to  the
Consolidated  Financial Statements.  The Company and Wyman-Gordon entered into a
new long-term purchase and sale agreement covering the sale of TIMET products to
various  Wyman-Gordon  locations  through  2008.  The  Company  expects  the new
agreement to, among other things, improve its future plant operating rates.

     Gross margin (net sales less cost of sales) was 0% during the third quarter
of 2003,  compared to negative 6% during the year-ago period. The improvement in
gross margin was primarily a result of the Company's  continued  cost  reduction
efforts,  improved plant  operating rates (from 45% in the third quarter of 2002
to  55%  in  the  third  quarter  of  2003)  and  favorable  raw  material  mix.
Additionally,  the Company  currently  expects a reduction in its LIFO inventory
reserve  at the end of 2003 as  compared  to the end of 2002.  As a result,  the
Company  reduced cost of sales by $3.9  million in the third  quarter of 2003 in
anticipation of this reduction.  This compared with an increase in the Company's
LIFO  inventory  reserve at September 30, 2002 compared to the end of 2001,  for
which the Company  increased  cost of sales by $3.5 million in the third quarter
of 2002.  Gross  margin  during the third  quarter  of 2003 was also  positively
impacted by the Company's  revision of its estimate of probable loss  associated
with the previously  reported tungsten inclusion matter.  Based upon an analysis
of information pertaining to asserted and unasserted claims, the Company reduced
its accrual for pending and future customer claims to $0.5 million, resulting in
a $1.7 million  reduction in cost of sales during the third quarter of 2003. See
Note 14 to the Consolidated Financial Statements.  Gross margin during the third
quarter of 2003 was  adversely  impacted by the $6.8 million  reduction in sales
relating to the termination of the Wyman-Gordon agreement.

     Selling, general,  administrative and development expenses decreased by 20%
from $10.7 million  during the third quarter of 2002 to $8.5 million  during the
third  quarter of 2003,  principally  as a result of lower  personnel and travel
costs, as well as focused cost control in other administrative areas.

     Equity in (losses)  earnings of joint  ventures  decreased from earnings of
$0.3 million  during the third quarter of 2002 to a loss of $0.1 million  during
the third  quarter  of 2003,  principally  due to a  decrease  in the  operating
results of VALTIMET, the Company's minority-owned welded tube joint venture.

     Net other income  (expense)  decreased by 9% from $10.9 million  during the
third  quarter  of 2002 to $9.9  million  during  the  third  quarter  of  2003,
principally  due to an decrease  in the amount of income the Company  recognized
under the take-or-pay provisions of its agreement with Boeing.

                                     - 22 -

<PAGE>


     First  nine  months of 2003  compared  to first  nine  months of 2002.  The
Company's  sales of mill products  decreased 2% from $212.9  million  during the
nine months ended  September 30, 2002 to $208.6  million  during the nine months
ended  September 30, 2003. This decrease was principally due to a 5% decrease in
mill product  sales  volume,  partially  offset by a 3% increase in mill product
average selling prices (using actual product mix and foreign  currency  exchange
rates prevailing during the respective periods) and the effects of the weakening
of the U.S.  dollar  compared to the British  pound  sterling  and the euro.  In
billing  currencies,  mill product  selling prices  decreased 7% during the nine
months ended  September 30, 2003  compared to the year ago period.  Mill product
selling  prices  expressed in U.S.  dollars  decreased 2% during the nine months
ended September 30, 2003 compared to the 2002 period.

     Melted  product  sales  increased  48% from $28.0  million  during the nine
months ended  September 30, 2002 to $41.3  million  during the nine months ended
September  30, 2003  primarily  due to an 85% increase in melted  product  sales
volume,  partially  offset by a 20% decrease in melted product  average  selling
prices.  The  increase  in melted  product  sales  was a result of new  customer
relationships,  share gains and changes in product mix. Excluding the effects of
changes in product mix, melted product  selling prices  decreased 15% during the
nine months ended September 30, 2003 compared to the 2002 period.

     Net sales during the nine months ended September 30, 2003 were also reduced
by  the  $6.8  million  one-time  charge  related  to  the  termination  of  the
Wyman-Gordon agreement.

     Gross  margin was 2% during  the nine  months  ended  September  30,  2003,
compared to 1% during the year-ago  period.  The improvement in gross margin was
primarily  a result  of the  Company's  continued  cost  reduction  efforts  and
favorable  raw  material  mix.  Additionally,  the Company  currently  expects a
reduction  in its LIFO  inventory  reserve at the end of 2003 as compared to the
end of 2002. As a result,  the Company  reduced cost of sales by $4.5 million in
the nine months ended September 30, 2003 in anticipation of this reduction. This
compared with an increase in the Company's LIFO  inventory  reserve at September
30, 2002 compared to the end of 2001,  for which the Company  increased  cost of
sales by $7.0 million in the nine months ended September 30, 2002.  Gross margin
during the nine months ended September 30, 2003 was also positively  impacted by
the $1.7 million  reduction  in cost of sales  during the third  quarter of 2003
related to the Company's  revision of its estimate of probable  loss  associated
with the tungsten  inclusion matter.  See Note 14 to the Consolidated  Financial
Statements.  Gross margin  during the nine months ended  September  30, 2003 was
adversely  impacted  by the $6.8  million  reduction  in sales  relating  to the
termination of the Wyman-Gordon agreement.

     Selling, general,  administrative and development expenses decreased by 14%
from $32.5  million  during the nine months  ended  September  30, 2002 to $28.0
million during the nine months ended September 30, 2003, principally as a result
of lower  personnel and travel  costs,  as well as focused cost control in other
administrative areas.

     Equity in earnings of joint ventures decreased from $1.7 million during the
nine months  ended  September  30, 2002 to $0.3  million  during the nine months
ended September 30, 2003, principally due to a decrease in earnings of VALTIMET.

                                     - 23 -

<PAGE>


     Net other income  (expense)  increased by 2% from $13.2 million  during the
nine months ended  September  30, 2002 to $13.5  million  during the nine months
ended September 30, 2003, principally due to an increase in the amount of income
the Company  recognized  under the take-or-pay  provisions of its agreement with
Boeing and a $0.5 million first quarter 2003 gain from the Company's  settlement
of certain  litigation  relating to power  outages  suffered  at its  Henderson,
Nevada facility in 1997 and 1998 as a result of contractor activity.

Non-operating income (expense).

<TABLE>

                                                         Three months ended                  Nine months ended
                                                            September 30,                      September 30,
                                                   --------------------------------    -------------------------------
                                                       2003              2002               2003             2002
                                                   --------------    --------------    --------------   --------------
                                                           (In thousands)                      (In thousands)

<S>                                                <C>               <C>               <C>              <C>
Interest income                                    $       74        $         16      $        255     $        105
SMC impairment charge                                       -                   -                 -          (27,500)
Foreign exchange gain (loss)                              240                  50              (647)            (292)
Interest expense                                         (328)               (915)           (1,504)          (2,388)
Surety bond guarantee                                     (50)               (918)              (50)            (918)
Other income (expense), net                              (380)                  6              (462)            (598)
                                                   --------------    --------------    --------------   --------------

                                                   $     (444)       $     (1,761)     $     (2,408)    $    (31,591)
                                                   ==============    ==============    ==============   ==============
</TABLE>

     In March 2002, SMC and its U.S. subsidiaries filed a voluntary petition for
reorganization  under Chapter 11 of the U.S.  Bankruptcy Code. As a result,  the
Company  undertook an assessment of its investment in SMC with the assistance of
an external  valuation  specialist  and  recorded an  additional  $27.5  million
impairment  charge during the first quarter of 2002 for an other than  temporary
decline  in the  estimated  fair value of its  investment  in SMC.  This  charge
reduced the Company's carrying amount of its investment in the SMC securities to
zero.  Under the terms of SMC's  Second  Amended  Joint Plan of  Reorganization,
which was confirmed by the  Bankruptcy  Court on September 29, 2003, the Company
currently  believes  that it will not  recover  any  material  amount  from this
investment.

     TIMET is the  primary  obligor on two $1.5  million  workers'  compensation
bonds issued on behalf of Freedom Forge, which TIMET sold in 1989. Freedom Forge
filed for Chapter 11 bankruptcy  protection on July 13, 2001,  and  discontinued
payment on the underlying workers'  compensation claims in November 2001. During
2002, TIMET received notices that the issuers of the bonds were required to make
payments  on one of the bonds with  respect to certain of these  claims and were
requesting  reimbursement from TIMET.  Based upon loss projections,  the Company
accrued  $0.9  million  in the  third  quarter  of 2002 for  this  bond as other
non-operating expense. During 2003, TIMET received notice that certain claimants
had submitted  claims under the second bond. As of September 30, 2003,  payments
under the second bond have been immaterial,  however the Company expects to make
additional payments in the future. Accordingly,  the Company accrued $50,000 for
this bond as other non-operating  expense in the third quarter of 2003. See Note
14 to the Consolidated Financial Statements.

                                     - 24 -

<PAGE>


     Income  taxes.  The Company  operates in several tax  jurisdictions  and is
subject to varying income tax rates.  As a result,  the geographic mix of pretax
income or loss can impact the  Company's  overall  effective  tax rate.  For the
three and nine months ended  September 30, 2003 and 2002,  the Company's  income
tax rate varied from the U.S. statutory rate primarily due to an increase in the
deferred tax valuation  allowance  related to the Company's tax attributes  that
did not  meet  the  "more-likely-than-not"  recognition  criteria  during  those
periods.  See Note 13 to the Consolidated  Financial  Statements.  The Company's
current tax expense  during the three and nine months ended  September  30, 2003
and 2002 relates primarily to its operations in France and Italy.

     Minority  interest.  Dividend  expense related to the Company's 6.625% BUCS
approximates  $3.3  million per  quarter  and is  reported  in the  Consolidated
Statement of Operations as minority interest. As previously reported in the 2002
Annual Report, no income tax benefit is currently  associated with this expense.
In October  2002,  the  Company  exercised  its right to defer  future  dividend
payments  on these  securities  effective  with the  Company's  December 1, 2002
scheduled  dividend payment.  Dividends continue to accrue at the coupon rate on
the principal and unpaid  dividends.  The Company will consider resuming payment
of dividends on the BUCS once the outlook for the  Company's  business  improves
substantially. See Note 11 to the Consolidated Financial Statements.

     Cumulative effect of change in accounting  principles.  On January 1, 2003,
the Company adopted SFAS No. 143,  Accounting for Asset Retirement  Obligations,
and recognized (i) an asset  retirement  cost  capitalized as an increase to the
carrying  value of its  property,  plant and  equipment  of  approximately  $0.2
million, (ii) accumulated depreciation on such capitalized cost of approximately
$0.1  million  and (iii) a  liability  for the asset  retirement  obligation  of
approximately $0.3 million. The asset retirement  obligation  recognized relates
primarily to landfill closure and leasehold restoration costs.

     On January 1, 2002,  the Company  adopted SFAS No. 142,  Goodwill and Other
Intangible Assets,  and recorded a non-cash goodwill  impairment charge of $44.3
million,  representing the entire balance of the Company's  recorded goodwill at
January 1, 2002.

     See further discussion regarding the Company's adoption of these accounting
principles in Notes 1 and 6 to the Consolidated Financial Statements.

     European  operations.  The Company has  substantial  operations  and assets
located in Europe,  principally the United Kingdom,  with smaller  operations in
France and Italy.  Titanium is sold worldwide,  and many factors influencing the
Company's  U.S. and European  operations are similar.  Approximately  42% of the
Company's  sales  originated  in Europe for the nine months ended  September 30,
2003, of which  approximately 63% were denominated in the British pound sterling
or the euro. Certain purchases of raw materials, principally titanium sponge and
alloys, for the Company's  European  operations are denominated in U.S. dollars,
while  labor  and other  production  costs are  primarily  denominated  in local
currencies. The functional currencies of the Company's European subsidiaries are
those of their respective  countries,  and the European subsidiaries are subject
to exchange rate  fluctuations  that may impact reported earnings and may affect
the  comparability  of  period-to-period  operating  results.  Borrowings of the
Company's  European   operations  may  be  in  U.S.  dollars  or  in  functional
currencies.  The Company's  export sales from the U.S. are  denominated  in U.S.
dollars and are not subject to currency exchange rate fluctuations.

                                     - 25 -

<PAGE>


     The  Company  does  not  use  currency  contracts  to  hedge  its  currency
exposures. The Company's results of operations included net currency transaction
losses of $0.6 million during the nine months ended  September 30, 2003 and $0.3
million during the nine months ended  September 30, 2002. At September 30, 2003,
consolidated  assets  and  liabilities  denominated  in  currencies  other  than
functional  currencies  were  approximately  $28.4  million  and $41.8  million,
respectively,  consisting  primarily of U.S. dollar cash,  accounts  receivable,
accounts payable and borrowings.

     Supplemental  information.  The Company  completed  a reverse  split of its
common  stock (one share of  post-split  common stock for each  outstanding  ten
shares of  pre-split  common  stock)  effective  after the close of  trading  on
February 14, 2003. All share and per share disclosures for all periods presented
in MD&A have been adjusted to give effect to the reverse stock split.

     The Company's U.K. hourly  workforce and a substantial  portion of its U.K.
salaried  workforce are covered by  collective  bargaining  agreements  that are
re-negotiated annually on a calendar-year basis.  Negotiations continue relative
to the 2003 agreements. While the Company currently expects such negotiations to
be finalized  during the fourth quarter of 2003, it is possible that there could
be work  stoppages or other labor  disruptions  prior to  finalization  of these
agreements  that could  adversely  affect  the  Company's  business,  results of
operations, financial position and liquidity.

     Outlook.   The  Outlook  section  contains  a  number  of   forward-looking
statements,  all of which are based on  current  expectations  and  exclude  the
effect of potential future charges related to restructurings, asset impairments,
valuation allowances, changes in accounting principles and similar items, unless
otherwise  noted.  Undue reliance should not be placed on these  statements,  as
more fully  discussed  in the  "Forward-Looking  Information"  statement of this
Quarterly Report.  Actual results may differ  materially.  See also Notes to the
Consolidated  Financial Statements regarding commitments,  contingencies,  legal
matters,  environmental  matters and other  matters,  including  new  accounting
principles, which could materially affect the Company's future business, results
of operations, financial position and liquidity.

     Although the  commercial  airline  industry  continues to face  significant
challenges,  recent  economic  data have shown  signs of an  improving  business
environment in that sector. Airline passenger traffic in the U.S. and Europe has
benefited from, among other things,  the limited duration of the war in Iraq and
the  containment  of the Severe  Acute  Respiratory  Syndrome  (SARS).  However,
traffic  continues to remain below  pre-September 11, 2001 levels. In June 2003,
The Airline Monitor, a leading aerospace publication,  forecasted that the major
U.S. airlines' losses would decrease to $6.3 billion in 2003 and $3.0 billion in
2004,  after posting $11.2 billion in losses in 2002.  Since that time,  several
U.S.-based  commercial  airlines have reported  positive third quarter operating
results or have similarly indicated expectations of improved results in the last
half of 2003.

     TIMET expects sales for the full year 2003 to  approximate  $375 million to
$385  million.  Mill product  sales volume for the full year 2003 is expected to
approximate 8,700 metric tons, reflecting a 2% decrease compared to 2002 levels.
Melted  product  sales volume for the full year 2003 is expected to  approximate
4,350 metric tons,  reflecting an 81% increase over 2002 levels. The increase in
melted product sales volume is due in part to new customer relationships,  share
gains at certain  customers,  increased  military  aerospace  business and, to a
lesser extent, a shift in purchasing preference by certain customers in favor of
ingot and away from wrought products.

                                     - 26 -

<PAGE>


     The Company's backlog of unfilled orders was approximately  $160 million at
September  30, 2003,  up from $140 million at June 30, 2003,  but down  slightly
from $165 million at September  30, 2002.  Substantially  all the  September 30,
2003  backlog is  scheduled  to ship  within the next 12  months.  However,  the
Company's  order  backlog  may not be a reliable  indicator  of future  business
activity.

     The Company's  cost of sales is affected by a number of factors  including,
among others,  customer and product mix, material yields, plant operating rates,
raw material  costs,  labor and energy costs.  Raw material costs  represent the
largest  portion of the  Company's  manufacturing  cost  structure.  The Company
expects to manufacture a significant portion of its titanium sponge requirements
during the next several  quarters and purchase the balance.  The Company expects
the aggregate cost of purchased sponge to remain  relatively  stable through the
remainder of 2003. The Company is  experiencing  higher prices for certain types
of scrap, but it has somewhat mitigated those increased costs by utilizing other
cheaper raw material  inputs.  In addition,  the Company  recently  announced an
increase in prices on all  non-contract  titanium mill and melted products in an
effort to offset  increased  raw material  and energy  costs.  Overall  capacity
utilization  should  average  approximately  54%  in  2003;  however,  practical
capacity  utilization  measures can vary significantly based on product mix. The
Company  has  implemented  a number of  actions to reduce  manufacturing  costs,
including seeking supplier price concessions and implementing stringent spending
controls and programs to improve  manufacturing yields. The combination of these
efforts have improved  gross  margins,  and the Company  continues to expect its
gross margin to be about 2% for the full year 2003.

     Selling,  general,  administrative and development expenses for 2003 should
approximate $37 million. Interest expense in 2003 should approximate $2 million.
Minority interest on the Company's BUCS in 2003 should  approximate $14 million,
including  additional  interest  costs  related to the  deferral  of the related
dividend payments.

     The Company  currently  anticipates  Boeing will purchase about 1.4 million
pounds of product from the Company in 2003. At this projected  order level,  the
Company  expects to recognize about $23 million of income under the Boeing LTA's
take-or-pay  provisions  in 2003,  which is $1  million  lower  than  previously
anticipated.  Any such earnings will be reported as operating  income,  but will
not be included in sales revenue, sales volume or gross margin.

     The Company now expects its operating  loss in 2003 to range from breakeven
to a $5 million  loss and its net loss in 2003 to range from $20  million to $25
million,  which reflects a $5 million to $10 million improvement from previously
reported expectations.

     The Company  continues  to expect to generate $40 million to $50 million in
cash flow from operations during 2003. Capital expenditures in 2003 are expected
to approximate $11 million, principally covering capital maintenance, safety and
environmental  programs.  Depreciation and amortization  should  approximate $37
million in 2003.

                                     - 27 -

<PAGE>


LIQUIDITY AND CAPITAL RESOURCES

     The  Company's  consolidated  cash  flows  provided  (used)  by  operating,
investing and financing activities are presented below. The following discussion
should  be  read  in  conjunction  with  the  Company's  Consolidated  Financial
Statements and Notes thereto.

<TABLE>
                                                                              Nine months ended September 30,
                                                                        --------------------------------------------
                                                                                2003                     2002
                                                                        ---------------------      -----------------
                                                                                         (In thousands)
<S>                                                                     <C>                        <C>
Cash provided (used) by:
   Operating activities                                                 $          50,605          $        (18,650)
   Investing activities                                                            (5,948)                   (4,765)
   Financing activities                                                           (21,121)                    4,150
                                                                        ---------------------      -----------------

   Net cash provided (used) by operating,
     investing and financing activities                                 $          23,536          $        (19,265)
                                                                        =====================      =================
</TABLE>

     Operating  activities.  The titanium  industry  historically  has derived a
substantial portion of its business from the aerospace  industry.  The aerospace
industry is cyclical,  and changes in economic  conditions  within the aerospace
industry  significantly  impact the Company's earnings and operating cash flows.
Cash flow from  operations  is  considered  a  primary  source of the  Company's
liquidity.  Changes in titanium pricing,  production volume and customer demand,
among other things, could significantly affect the Company's liquidity.

     Certain items  included in the  determination  of net income (loss) have an
impact on cash flows from operating activities,  but the impact of such items on
cash may differ from their impact on net income.  For example,  pension  expense
and OPEB expense will generally  differ from the outflows of cash for payment of
such benefits. In addition, relative changes in assets and liabilities generally
result from the timing of production, sales and purchases. Such relative changes
can  significantly  impact the  comparability  of cash flow from operations from
period to period,  as the income  statement  impact of such items may occur in a
different period than that in which the underlying cash transaction  occurs. For
example,  raw materials may be purchased in one period, but the cash payment for
such raw materials may occur in a subsequent period. Similarly, inventory may be
sold in one period,  but the cash  collection of the  receivable  may occur in a
subsequent period.

     Net loss decreased from $101.9 million for the nine months ended  September
30, 2002,  to $22.9 million for the nine months ended  September  30, 2003.  See
"Results of Operations - Cumulative  effect of change in accounting  principles"
and  Note 6 to the  Consolidated  Financial  Statements  for  discussion  of the
Company's  adoption of SFAS No. 142 and the  related  effect on net loss for the
nine months ended September 30, 2002. See "Results of Operations - Non-operating
income (expense),  net" and Note 4 to the Consolidated  Financial Statements for
discussion of the Company's  impairment of its  investment in SMC securities and
its affect on net loss for the period ended September 30, 2002.

     Accounts  receivable was relatively  unchanged during the first nine months
of 2003.  Accounts  receivable  decreased  during the first nine  months of 2002
primarily as a result of  decreased  sales,  partially  offset by an increase in
days sales outstanding.

                                     - 28 -

<PAGE>


     Inventories  decreased  during the first nine months of 2003 as a result of
higher melted product sales volumes during the first nine months of 2003 and the
Company's focus on inventory reduction.  The Company expects inventory levels to
decline  further during the fourth  quarter of 2003,  although at a slower pace.
Inventories increased in the first nine months of 2002 as a result of production
begun by the  Company  prior to certain  customer  cancellations  and  push-outs
related  to the  downturn  in the  commercial  aerospace  market,  the timing of
certain raw materials purchases and the accelerated production of certain orders
as part of the Company's contingency planning for a possible labor disruption at
the Company's Toronto plant.

     Prepaid expenses and other assets increased during the first nine months of
2003  primarily  due to an increase in advance  payments made by the Company for
property and  equipment  yet to be received.  Prepaid  expenses and other assets
decreased  during the first nine months of 2002  primarily due to the receipt of
raw  materials and property and equipment for which the Company had made advance
payments during 2001.

     Changes in accounts payable and accrued  liabilities  reflect,  among other
things,  the timing of payments to suppliers of titanium sponge,  titanium scrap
and other raw materials purchases. In addition, the Company accrued $4.8 million
in the  third  quarter  of 2003  for  future  installments  due to  Wyman-Gordon
relative  to the  previously  discussed  termination  of the  purchase  and sale
agreement.

     Under the terms of the  amended  Boeing LTA,  in years 2002  through  2007,
Boeing advances TIMET $28.5 million  annually,  less $3.80 per pound of titanium
product purchased from TIMET by Boeing subcontractors during the preceding year.
The increase in customer advances during the first nine months of 2003 primarily
reflects the Company's  receipt in January 2003 of a $27.7 million  advance from
Boeing,  partially  offset by the  application  of  customer  purchases  and the
recognition  of  $12.9  million  of  Boeing-related  take-or-pay  income  though
September  30, 2003.  The 2002 advance of $28.5 million was received in December
2001. Consequently,  customer advances decreased during the first nine months of
2002 as a result of the application of customer purchases and the recognition of
$12.7 million of  Boeing-related  take-or-pay  income though September 30, 2002.
The Company currently estimates that the reduction against the 2004 advance from
Boeing for subcontractor purchases during 2003 will be less than $1 million. See
also Note 9 to the Consolidated Financial Statements.

     In October 2002, the Company  exercised its right to defer future  dividend
payments on its BUCS for a period of up to 20  consecutive  quarters,  effective
beginning  with the  Company's  December  1, 2002  scheduled  dividend  payment.
Dividends  continue  to accrue at the coupon  rate on the  principal  and unpaid
dividends and are reflected as long-term liabilities in the Consolidated Balance
Sheet. The Company will consider  resuming payment of dividends on the BUCS once
the outlook for the Company's business improves substantially. Since the Company
exercised its right to defer dividend payments,  it is unable under the terms of
these  securities,  among other  things,  to pay  dividends on or reacquire  its
capital stock during the deferral period.  However,  the Company is permitted to
reacquire the BUCS during the deferral period provided the Company has satisfied
certain conditions under its U.S. credit facility,  including maintenance of the
Company's  excess   availability   above  $25  million  before  and  after  such
reacquisition.

     Investing activities.  The Company's capital expenditures were $6.0 million
for the nine months ended  September 30, 2003,  compared to $4.8 million for the
same  period  in 2002,  principally  for  capital  maintenance  and  safety  and
environmental projects.

                                     - 29 -

<PAGE>


     Financing activities.  Cash used during the nine months ended September 30,
2003 was due primarily to the Company's  $18.5 million of net  repayments on its
outstanding  borrowings  upon the Company's  receipt of the $27.7 million Boeing
advance in January 2003.  Cash provided  during the nine months ended  September
30,  2002 was due  primarily  to $5.7  million of net  borrowings  necessary  to
fulfill the Company's  working  capital  needs.  TIMET Savoie also made dividend
payments to CEZUS of $1.9 million and $1.1 million  during the second quarter of
2003 and 2002, respectively.

     Borrowing  arrangements.  Under the terms of the Company's U.S. asset-based
revolving  credit  agreement,  which matures in February  2006,  borrowings  are
limited to the lesser of $105  million or a  formula-determined  borrowing  base
derived  from  the  value  of  accounts  receivable,   inventory  and  equipment
("borrowing availability"). This facility requires the Company's U.S. daily cash
receipts  to be  used  to  reduce  outstanding  borrowings,  which  may  then be
reborrowed subject to the terms of the agreement.  Interest generally accrues at
rates  that  vary  from  LIBOR  plus  2% to  LIBOR  plus  2.5%.  Borrowings  are
collateralized  by substantially  all of the Company's U.S.  assets.  The credit
agreement  prohibits  the  payment  of  dividends  on  TIMET's  BUCS if  "excess
availability,"  as  defined,  is  less  than  $25  million,   limits  additional
indebtedness,  prohibits the payment of dividends on the Company's  common stock
if  excess  availability  is less than $40  million,  requires  compliance  with
certain  financial  covenants and contains other covenants  customary in lending
transactions  of this  type.  The  Company  was in  compliance  in all  material
respects with all covenants for the nine months ended September 30, 2003 and for
all periods  during the year ended  December 31, 2002.  Excess  availability  is
defined as  borrowing  availability  less  outstanding  borrowings  and  certain
contractual commitments such as letters of credit. At September 30, 2003, excess
availability was approximately $78 million.

     The Company's  subsidiary,  TIMET UK, has a credit  agreement that provides
for   borrowings   limited   to  the   lesser  of   (pound)22.5   million  or  a
formula-determined borrowing base derived from the value of accounts receivable,
inventory  and  equipment  ("borrowing  availability").   The  credit  agreement
includes a revolving and term loan facility and an overdraft facility (the "U.K.
facilities") and matures in December 2005.  Borrowings under the U.K. facilities
can be in various currencies including U.S. dollars, British pounds sterling and
euros;  accrue  interest  at rates  that vary from  LIBOR  plus 1% to LIBOR plus
1.25%; and are  collateralized  by substantially  all of TIMET UK's assets.  The
U.K.  facilities require the maintenance of certain financial ratios and amounts
and other covenants customary in lending transactions of this type. TIMET UK was
in  compliance  in all material  respects with all covenants for the nine months
ended  September 30, 2003 and for all periods during the year ended December 31,
2002.  The U.K.  overdraft  facility is subject to annual  review in December of
each year.  In the event the  overdraft  facility  is not  renewed,  the Company
believes it could refinance any outstanding  overdraft  borrowings  under either
the  revolving or term loan features of the U.K.  facilities.  During the second
quarter of 2003, TIMET UK received an interest-bearing  intercompany loan from a
U.S.  subsidiary  of the  Company  enabling  TIMET UK to  reduce  its  long-term
borrowings under the U.K.  facilities to zero. Unused borrowing  availability at
September 30, 2003 under the U.K. facilities was approximately $37 million.

     The Company also has  overdraft  and other credit  facilities at certain of
its other European  subsidiaries.  These  facilities  accrue interest at various
rates and are payable on demand. Unused borrowing  availability at September 30,
2003 under these facilities was approximately $18 million.

                                     - 30 -

<PAGE>

     Legal and environmental  matters. See Note 14 to the Consolidated Financial
Statements for discussion of legal and  environmental  matters,  commitments and
contingencies.

     Other.  The Company  periodically  evaluates  its  liquidity  requirements,
capital needs and availability of resources in view of, among other things,  its
alternative  uses of capital,  debt service  requirements,  the cost of debt and
equity capital and estimated  future  operating cash flows.  As a result of this
process, the Company has in the past, or in light of its current outlook, may in
the future,  seek to raise additional  capital,  modify its common and preferred
dividend  policies,   restructure  ownership  interests,   incur,  refinance  or
restructure  indebtedness,  repurchase  shares  of  common  stock or BUCS,  sell
assets, or take a combination of such steps or other steps to increase or manage
its liquidity and capital resources.

     In the normal  course of  business,  the Company  investigates,  evaluates,
discusses and engages in acquisition,  joint venture, strategic relationship and
other business  combination  opportunities in the titanium,  specialty metal and
other  industries.  In the  event of any  future  acquisition  or joint  venture
opportunities,  the Company may consider using then-available liquidity, issuing
equity securities or incurring additional indebtedness.

Non-GAAP financial measures

     In an effort to provide  investors  with  information  in  addition  to the
Company's results as determined by accounting  principles  generally accepted in
the United  States of America  ("GAAP"),  the Company has provided the following
non-GAAP  financial  disclosures that it believes may provide useful information
to investors:

     o    The  Company  discloses  percentage  changes  in its mill  and  melted
          product  selling prices in U.S.  dollars,  which have been adjusted to
          exclude the effects of changes in product  mix.  The Company  believes
          such  disclosure  provides useful  information to investors,  allowing
          them to analyze such changes  without the impact of changes in product
          mix, thereby facilitating period-to-period comparisons of the relative
          changes in average  selling  prices.  Depending on the  composition of
          changes in  product  mix,  the  percentage  change in  selling  prices
          excluding  the effect of changes in product mix can be higher or lower
          than such  percentage  change  would be using the actual  product  mix
          prevailing during the respective periods; and

     o    In  addition  to  disclosing  percentage  changes in its mill  product
          selling  prices  adjusted to exclude the effects of changes in product
          mix, the Company also  discloses  such  percentage  changes in billing
          currencies, which have been further adjusted to exclude the effects of
          changes in foreign currency  exchange rates. The Company believes such
          disclosure provides useful information to investors,  allowing them to
          analyze such changes without the impact of changes in foreign currency
          exchange rates, thereby facilitating  period-to-period  comparisons of
          the relative  changes in average  selling prices in the actual various
          billing  currencies.  Generally,  when  the  U.S.  dollar  strengthens
          (weakens) against other  currencies,  the percentage change in selling
          prices  in  billing  currencies  will  be  higher  (lower)  than  such
          percentage  changes would be using actual  exchange  rates  prevailing
          during the respective periods.

                                     - 31 -

<PAGE>


Item 3.       QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     For a  discussion  of the  Company's  market  risks,  refer to the Item 7A,
"Quantitative and Qualitative Disclosures About Market Risk," in the 2002 Annual
Report.  There have been no material  changes to the  information  provided that
would  require  additional  information  with  respect to the nine months  ended
September 30, 2003.

Item 4.       CONTROLS AND PROCEDURES

     The Company maintains a system of disclosure  controls and procedures.  The
term "disclosure controls and procedures," as defined by regulations of the SEC,
means  controls and other  procedures of the Company that are designed to ensure
that information  required to be disclosed in the reports that the Company files
or submits to the SEC under the Securities Exchange Act of 1934, as amended (the
"Exchange  Act"), is recorded,  processed,  summarized and reported,  within the
time  periods  specified in the SEC's rules and forms.  Disclosure  controls and
procedures  include,  without  limitation,  controls and procedures  designed to
ensure that  information  required to be disclosed by the Company in the reports
that it files or submits to the SEC under the  Exchange Act is  accumulated  and
communicated  to the Company's  management,  including  its principal  executive
officer and its  principal  financial  officer,  or persons  performing  similar
functions,   as  appropriate  to  allow  timely  decisions   regarding  required
disclosure.  Both J. Landis Martin, the Company's Chief Executive  Officer,  and
Bruce  P.  Inglis,   the  Company's  Vice  President  -  Finance  and  Corporate
Controller,  have evaluated the Company's  disclosure controls and procedures as
of September 30, 2003.  Based upon their  evaluation,  these executive  officers
have  concluded  that the  Company's  disclosure  controls  and  procedures  are
effective as of the date of such evaluation.

     The Company also  maintains a system of internal  controls  over  financial
reporting.  The term "internal control over financial  reporting," as defined by
regulations  of the SEC, means a process  designed by, or under the  supervision
of, the  Company's  principal  executive and principal  financial  officers,  or
persons  performing  similar  functions,  and effected by the Company's board of
directors,  management  and other  personnel,  to provide  reasonable  assurance
regarding  the  reliability  of  financial  reporting  and  the  preparation  of
financial statements for external purposes in accordance with GAAP, and includes
those policies and procedures that:

     o    Pertain  to the  maintenance  of  records  that in  reasonable  detail
          accurately and fairly reflect the transactions and dispositions of the
          assets of the Company;

     o    Provide  reasonable   assurance  that  transactions  are  recorded  as
          necessary to permit preparation of financial  statements in accordance
          with GAAP, and that receipts and expenditures of the Company are being
          made  only  in  accordance  with   authorizations  of  management  and
          directors of the Company; and

     o    Provide reasonable  assurance regarding prevention or timely detection
          of  unauthorized  acquisition,  use or  disposition  of the  Company's
          assets that could have a material effect on the Company's consolidated
          financial statements.

     There has been no change to the Company's  system of internal  control over
financial  reporting  during  the  quarter  ended  September  30,  2003 that has
materially affected, or is reasonably likely to materially affect, the Company's
system of internal controls over financial reporting.

                                     - 32 -

<PAGE>


PART II. - OTHER INFORMATION

Item 1.    LEGAL PROCEEDINGS

     Reference  is made to Note  14 of the  Consolidated  Financial  Statements,
which  information  is  incorporated  herein by reference,  and to the Company's
Quarterly  Report for the period ended June 30, 2003 and the 2002 Annual  Report
for descriptions of certain previously reported legal proceedings.

Item 6.    EXHIBITS AND REPORTS ON FORM 8-K

     (a)  Exhibits:

          10.1 Termination  Agreement  by and between  Wyman-Gordon  Company and
               Titanium Metals Corporation effective as of September 28, 2003.

          31.1 Certification  pursuant to Section 302 of the  Sarbanes-Oxley Act
               of 2002.

          31.2 Certification  pursuant to Section 302 of the  Sarbanes-Oxley Act
               of 2002.

          32.1 Certification  pursuant to Section 906 of the  Sarbanes-Oxley Act
               of 2002.

          Note:The Company has retained a signed  original of any exhibit listed
               above that contains signatures,  and the Company will provide any
               such exhibit to the SEC or its staff upon request.

     (b)  Reports  on Form 8-K filed by the  registrant  for the  quarter  ended
          September 30, 2003 and through November 4, 2003:

                         Date of Report           Items Reported
                      ----------------------   --------------------

                         July 3, 2003                5 and 7
                         July 7, 2003                5 and 7
                         July 25, 2003             12 (under 9)
                         October 6, 2003             5 and 7
                         October 14, 2003            5 and 7
                         October 14, 2003               9
                         October 22, 2003            5 and 7
                         October 23, 2003            7 and 12

                                     - 33 -

<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.


                                        TITANIUM METALS CORPORATION
                               -------------------------------------------------
                                               (Registrant)



Date: November 5, 2003    By   /s/ J. Landis Martin
                               -------------------------------------------------
                               J. Landis Martin
                               Chairman of the Board, President and
                               Chief Executive Officer



Date: November 5, 2003    By   /s/ Bruce P. Inglis
                               -------------------------------------------------
                               Bruce P. Inglis
                               Vice President - Finance and Corporate Controller


                                     - 34 -