##### Table of Contents





UNITED STATES
 SECURITIES AND EXCHANGE
    COMMISSION
 WASHINGTON, D.C.
    20549
  FORM 10-K
  (Mark One)
  þ
    ANNUAL REPORT PURSUANT TO
    SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934  FOR THE FISCAL
    YEAR ENDED DECEMBER 31, 2010
 OR
  o
    TRANSITION REPORT PURSUANT TO
    SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934  For the transition period
    from 
    to
  Commission file
    number 001-14437
  RTI INTERNATIONAL METALS,
    INC.
 (Exact name of registrant as
    specified in its charter)
  Ohio

52-2115953(State of Incorporation)

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

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

15108-2973(Zip code)   Registrants telephone number,
    including area code:(412) 893-0026
  Securities registered pursuant
    to Section 12(b) of the Act:
  Title of each class

Name of each exchange on which registeredCommon Stock, par value $0.01 per share

New York Stock Exchange  Securities registered pursuant to Section 12(g) of the
    Act: None
   Yes þ     No o
   Yes o     No þ
   Yes þ     No o
  Regulation S-T
 Yes o     No o
  Regulation S-K Form 10-K Form 10-K. þ
  12b-2
  Large
    accelerated
    filer þ
    Accelerated
    filer o
    Non-accelerated
    filer o
    Smaller reporting
    company o (Do not check if a smaller
    reporting company)
  Rule 12b-2
 Yes o     No þ
      Documents
    Incorporated by Reference:




---



##### 





RTI
    INTERNATIONAL METALS, INC. AND CONSOLIDATED
    SUBSIDIARIES
       
  TABLE OF
    CONTENTS
  PagePART IItem 1.

Business


1Item 1A.

Risk Factors


9Item 1B.

Unresolved Staff Comments


13Item 2.

Properties


14Item 3.

Legal Proceedings


14Item 4.

(Removed and Reserved)


15PART IIItem 5.

Market for Registrants Common Equity,
    Related Stockholder Matters and Issuer Purchases of Equity
    Securities


16Item 6.

Selected Financial Data


17Item 7.

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


18Item 7A.

Quantitative and Qualitative Disclosures About
    Market Risk


36Item 8.

Financial Statements and Supplementary Data


37Item 9.

Changes in and Disagreements with Accountants on
    Accounting and Financial Disclosure


84Item 9A.

Controls and Procedures


84Item 9B.

Other Information


84PART IIIItem 10.

Directors, Executive Officers and Corporate
    Governance


85Item 11.

Executive Compensation


85Item 12.

Security Ownership of Certain Beneficial Owners
    and Management and Related Stockholder Matters


85Item 13.

Certain Relationships and Related Transactions,
    and Director Independence


86Item 14.

Principal Accountant Fees and Services


86PART IVItem 15.

Exhibits, Financial Statement Schedules


87Signatures


90EX-10.11EX-21.1EX-23.1EX-24.1EX-31.1EX-31.2EX-32.1EX-32.2




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##### Table of Contents



PART I Item 1.  Business  The
    Company
    Industry
    Overview
  strength-to-weight
        2010


2009


2008Commercial Aerospace


53
%


44
%


50
%Defense


30
%


40
%


34
%Industrial and Consumer


17
%


16
%


16
%   Commercial
    Aerospace
   1




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##### Table of Contents



Aerospace Market News, The Airline Monitor
  ®
  Defense
        Industrial &
    Consumer
    difficult-to-reach
    Products
    and Segments
   2




---



##### Table of Contents



Titanium
    Group
        Fabrication
    Group
  sub-assemblies,
  Distribution
    Group
  cuts-to-size, just-in-time
   3




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##### Table of Contents



2010


2009


2008(dollars in millions)

$


%


$


%


$


%Titanium Group

$
142.9



33.1
%

$
107.6



26.4
%

$
202.0



33.1
%Fabrication Group


134.4



31.1
%


106.2



26.0
%


146.8



24.1
%Distribution Group


154.5



35.8
%


194.2



47.6
%


261.1



42.8
%Total consolidated net sales

$
431.8



100.0
%

$
408.0



100.0
%

$
609.9



100.0
%     2010


2009


2008(dollars in millions)

$


%


$


%


$


%Titanium Group

$
18.4



130.5
%

$
(68.1
)


78.0
%

$
61.8



70.7
%Fabrication Group


(7.6
)


(53.9
)%


(26.3
)


30.1
%


2.0



2.3
%Distribution Group


3.3



23.4
%


7.1



(8.1
)%


23.6



27.0
%Total consolidated operating income (loss)

$
14.1



100.0
%

$
(87.3
)


100.0
%

$
87.4



100.0
%     (dollars in millions)

2010


2009


2008Titanium Group

$
367.6


$
365.7


$
375.0Fabrication Group


246.9



239.8



224.5Distribution Group


120.9



140.7



155.8General Corporate(1)


371.5



108.5



273.9Total consolidated assets

$
1,106.9


$
854.7


$
1,029.2     (1)
    
    Consists primarily of unallocated cash, short-term investments,
    and deferred tax assets.    (dollars in millions)

2010


2009


2008United States

$
243.8


$
229.4


$
262.6Canada


73.1



73.8



65.6England


5.5



5.4



5.4France


0.4



0.6



0.7Total consolidated long-lived assets

$
322.8


$
309.2


$
334.3   Exports
   4




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##### Table of Contents



Form 10-K.
  Backlog
  ®
  Raw
    Materials
        Competition
    and Other Market Factors
       5




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##### Table of Contents



Trade and
    Legislative Factors
      2007-2008
  off-the-shelf-items off-the-shelf off-the-shelf de minimis off-the-shelf
   6




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##### Table of Contents



Environmental
    Liabilities
  Form 10-K.
  Marketing
    and Distribution
    Research,
    Technical, and Product Development
      Patents
    and Trademarks
    Employees
     7




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##### Table of Contents



Executive
    Officers of the Registrant
    Name

Age

TitleDawne S. Hickton


53


Vice Chair, President and Chief Executive OfficerJames L. McCarley


47


Executive Vice President of OperationsStephen R. Giangiordano


53


Executive Vice President of Technology and InnovationWilliam T. Hull


53


Senior Vice President and Chief Financial OfficerWilliam F. Strome


55


Senior Vice President of Finance and AdministrationChad Whalen


36


Vice President, General Counsel and Secretary   Biographies
              Available
    Information
  www.rtiintl.com Form 10-K, Form 10-Q, Form 8-K,
 8




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##### Table of Contents



1-800-SEC-0330. www.sec.gov
 Item 1A.  Risk
    Factors.    We are
    subject to risks associated with global economic and political
    uncertainties.
    and/or
  A
    substantial amount of revenue is derived from the commercial
    aerospace and defense industries and a limited number of
    customers.
   9




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##### Table of Contents



Continued
    U.S. budget deficits could result in significant defense
    spending cuts and a reduction in the Joint Strike Fighter
    program.
    A
    significant amount of our future revenue is based on long-term
    contracts for new aircraft programs.
    The
    carrying value of goodwill and other intangible assets may not
    be recoverable.
    We are
    dependent on services that are subject to price and availability
    fluctuations.
    Fluctuations
    in our income tax obligations and effective income tax rate may
    result in volatility of our earnings and stock
    price.
    We may
    be affected by our ability to successfully expand our operations
    in a timely and cost effective manner.
   10




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##### Table of Contents



The
    demand for our products and services may be adversely affected
    by demand for our customers products and
    services.
    We may
    be subject to competitive pressures.
      We may
    experience a lack of supply of raw materials at costs that
    provide us with acceptable margin levels.
    We are
    subject to changes in product pricing.
    We may
    experience a shortage in the supply of energy or an increase in
    energy costs to operate our plants.
   11




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##### Table of Contents



We may
    not be able to recover the carrying value of our long-lived
    assets, which could require us to record additional asset
    impairment charges.
    Many
    of our products are used in critical aircraft
    components.
    Our
    business could be harmed by strikes or work
    stoppages.
      Our
    business is subject to the risks of international
    operations.
    Our
    success depends largely on our ability to attract and retain key
    personnel.
    The
    demand for our products and services may be affected by factors
    outside of our control.
   12




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##### Table of Contents



We may
    be affected by our ability or inability to obtain
    financing.
    The
    outcome of the U.S. Customs investigation of our previously
    filed duty drawback claims is uncertain.
    We are
    subject to, and could incur substantial costs and liabilities
    under, environmental, health, and safety laws.
  and/or and/or
 Item 1B.  Unresolved
    Staff Comments.   13




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##### Table of Contents



Item 2.  Properties.  Manufacturing
    Facilities
    Facilities
  Owned /



Annual RatedLocation

Leased

Products

CapacityTitanium GroupNiles, OH


Owned


Ingot (million pounds)


30.0Niles, OH


Owned


Mill products (million pounds)


22.0Canton, OH


Owned


Ferro titanium and specialty alloys (million pounds)


16.0Hermitage, PA


Owned


Metal processing (million pounds)


5.0Martinsville, VA


Owned


Titanium forging and rolling (facility under construction)


Fabrication GroupWashington, MO


Owned


Hot and superplastically formed parts (thousand press hours)


50.0Laval, Canada


Owned


Machining/assembly of aerospace parts (thousand man hours)


400Houston, TX


Leased


Extruded, hot stretch formed products (million pounds)


4.2Houston, TX


Owned


Machining/fabricating oil/gas products (thousand man hours)


200Distribution GroupStaffordshire, England


Leased


Cut parts and components (thousand man hours)


45.0Rosny-Sur-Seine, France


Leased


Cut parts and components (thousand man hours)


16.0Sullivan, MO


Leased


Cut parts (thousand man hours)


23.0Garden Grove, CA


Leased


Metal warehousing and distribution


N/AWindsor, CT


Leased


Metal warehousing and distribution


N/A    Item 3.  Legal
    Proceedings.    Tronox
    LLC Litigation
  and/or
 14




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##### Table of Contents



Item 4.  (Removed
    and Reserved). 15




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##### Table of Contents



PART II  Item 5.
    Market
    for Registrants Common Equity, Related Stockholder Matters
    and Issuer Purchases of Equity Securities.  Range of High and Low Stock Prices of Common Stock
  2010


2009Quarter

High


Low


High


LowFirst

$
32.77


$
20.81


$
16.48


$
8.99Second

$
31.40


$
21.60


$
22.88


$
11.23Third

$
32.39


$
22.91


$
26.19


$
14.53Fourth

$
31.98


$
26.34


$
26.25


$
17.57           Maximum DollarValue of SharesTotal Number of


that May YetShares Purchased


Be PurchasedTotal Number of





as Part of Publicly


Under the PlansShares


Average Price


Announced Plans or


or ProgramsPurchased(1)


Paid Per Share


Programs(2)


(In thousands)(3)October 1 - 31, 2010


459


$
29.42






$
2,973November 1 - 30, 2010


306



28.18







2,973December 1 - 31, 2010














2,973Total


765


$
28.92



     (1)
    
    Shares were repurchased under (i) the Companys
    $15 million share repurchase program approved by the Board
    of Directors on April 30, 1999, and (ii) a program
    that allows employees to surrender shares to the Company to pay
    tax liabilities associated with the vesting of restricted stock
    awards under the 2004 Stock Plan.(2)
    
    Includes only shares reacquired under the Companys
    $15 million share repurchase program.(3)
    
    Amounts in this column reflect amounts remaining under the
    Companys $15 million share repurchase program.     16




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##### Table of Contents



Item 6.  Selected
    Financial Data.      Years Ended December 31,2010


2009


2008


2007


2006Income Statement Data:Net sales

$
431,793


$
407,978


$
609,900


$
626,799


$
505,389Operating income (loss)


14,061



(87,276
)


87,392



141,161



115,253Income (loss) before income taxes


11,820



(96,056
)


87,975



142,467



118,291Net income (loss)


3,417



(67,239
)


55,695



92,631



75,700Basic earnings (loss) per share(1)

$
0.11


$
(2.67
)

$
2.42


$
4.01


$
3.32Diluted earnings (loss) per share(1)

$
0.11


$
(2.67
)

$
2.41


$
3.99


$
3.27   December 31,2010


2009


2008


2007


2006Balance Sheet Data:Working capital

$
636,656


$
387,761


$
559,601


$
405,907


$
365,711Total assets


1,106,854



854,735



1,029,203



755,284



643,913Long-term debt


178,107



81



238,550



16,506



13,270Total shareholders equity


718,400



679,206



601,934



575,784



462,181     (1)
    
    Adjusted for retrospective application of the provisions of the
    new earnings per share accounting guidance which became
    effective for the Company on January 1, 2009. For further
    information on this new guidance, see Note 4 to the
    Companys Consolidated Financial Statements included in
    this Annual Report on
    Form 10-K. 17




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##### Table of Contents



Item 7.  Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations.  Forward-Looking
    Statements
    
    the future availability and prices of raw materials,
    competition in the titanium industry,
    the historic cyclicality of the titanium and commercial
    aerospace industries,
    changes in defense spending and cancellation or changes in
    defense programs or initiatives,
    changes in the Joint Strike Fighter production schedule,
    the ability to obtain access to financial markets and to
    maintain current covenant requirements,
    long-term supply agreements and the impact if another party to a
    long-term supply agreement fails to fulfill its requirements
    under existing contracts or successfully manage its future
    development and production schedule,
    the impact of the current titanium inventory overhang throughout
    our supply chain,
    the impact of Boeing 787
    Dreamliner®

    production delays,
    our ability to attract and retain key personnel,
    legislative challenges to the Specialty Metals Clause, which
    requires that titanium for U.S. defense programs be
    produced in the U.S.
    labor matters,
    global economic activities,
    the successful completion of our expansion projects,
    our ability to execute on new business awards,
    our order backlog and the conversion of that backlog into
    revenue,
    demand for our products, and
    other statements contained herein that are not historical facts.    Overview
   18




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##### Table of Contents



sub-assemblies,
  cuts-to-size, just-in-time
    Trends
    and Uncertainties
      Executive
    Summary
  ®
   19




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##### Table of Contents



Results
    of Operations
  For
    the Year Ended December 31, 2010 Compared to the Year Ended
    December 31, 2009
  Net Sales.
  Years EndedDecember 31,


$ Increase/


%Increase/(dollars in millions)

2010


2009


(Decrease)


(Decrease)Titanium Group

$
142.9


$
107.6


$
35.3



32.8
%Fabrication Group


134.4



106.2



28.2



26.6
%Distribution Group


154.5



194.2



(39.7
)


(20.4
)%Total consolidated net sales

$
431.8


$
408.0


$
23.8



5.8
%     ® ® ® ramp-up
    Gross Profit.
  Years EndedDecember 31,


$ Increase/


%Increase/(dollars in millions)

2010


2009


(Decrease)


(Decrease)Titanium Group

$
30.8


$
20.6


$
10.2



49.5
%Fabrication Group


20.4



5.2



15.2



292.3
%Distribution Group


24.7



30.0



(5.3
)


(17.7
)%Total consolidated gross profit

$
75.9


$
55.8


$
20.1



36.0
%  20




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##### Table of Contents



ramp-up ® ramp-up ®
    Selling, General, and Administrative
    Expenses.
  Years EndedDecember 31,


$ Increase/


%Increase/(dollars in millions)

2010


2009


(Decrease)


(Decrease)Titanium Group

$
14.1


$
17.8


$
(3.7
)


(20.8
)%Fabrication Group


28.0



22.8



5.2



22.8
%Distribution Group


21.5



22.9



(1.4
)


(6.1
)%Total consolidated SG&A

$
63.6


$
63.5


$
0.1



0.2
%     Research, Technical, and Product Development
    Expenses.
  Asset and Asset-related Charges
    (Income).
 21




---



##### Table of Contents



Operating Income (Loss).
  Years EndedDecember 31,


$ Increase/


%Increase/(dollars in millions)

2010


2009


(Decrease)


(Decrease)Titanium Group

$
18.4


$
(68.1
)

$
86.5



127.0
%Fabrication Group


(7.6
)


(26.3
)


18.7



71.1
%Distribution Group


3.3



7.1



(3.8
)


(53.5
)%Total consolidated operating income (loss)

$
14.1


$
(87.3
)

$
101.4



(116.2
)%     ramp-up ®
    Other Income (Expense).
  Interest Income and Interest Expense.
  Provision for (Benefit from) Income Tax.
 22




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##### Table of Contents



For
    the Year Ended December 31, 2009 Compared to the Year Ended
    December 31, 2008
  Net Sales.
  Years EndedDecember 31,


$ Increase/


%Increase/(Dollars in millions)

2009


2008


(Decrease)


(Decrease)Titanium Group

$
107.6


$
202.0


$
(94.4
)


(46.7
)%Fabrication Group


106.2



146.8



(40.6
)


(27.7
)%Distribution Group


194.2



261.1



(66.9
)


(25.6
)%Total consolidated net sales

$
408.0


$
609.9


$
(201.9
)


(33.1
)%   ®
  ®
    Gross Profit.
  Years EndedDecember 31,


$ Increase/


%Increase/(Dollars in millions)

2009


2008


(Decrease)


(Decrease)Titanium Group

$
20.6


$
86.6


$
(66.0
)


(76.2
)%Fabrication Group


5.2



31.4



(26.2
)


(83.4
)%Distribution Group


30.0



49.3



(19.3
)


(39.1
)%Total consolidated gross profit

$
55.8


$
167.3


$
(111.5
)


(66.6
)%   ®
 23




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##### Table of Contents



®
        Selling, General, and Administrative
    Expenses.
  Years EndedDecember 31,


$ Increase/


%Increase/(Dollars in millions)

2009


2008


(Decrease)


(Decrease)Titanium Group

$
17.8


$
22.8


$
(5.0
)


(21.9
)%Fabrication Group


22.8



29.3



(6.5
)


(22.2
)%Distribution Group


22.9



25.7



(2.8
)


(10.9
)%Total consolidated SG&A

$
63.5


$
77.8


$
(14.3
)


(18.4
)%     Research, Technical, and Product Development
    Expenses.
  Asset and Asset-related Charges (Income).
 24




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##### Table of Contents



Goodwill Impairment.
  Operating Income (Loss).
  Years EndedDecember 31,


$ Increase/


% Increase/(Dollars in millions)

2009


2008


(Decrease)


(Decrease)Titanium Group

$
(68.1
)

$
61.8


$
(129.9
)


(210.2
)%Fabrication Group


(26.3
)


2.0



(28.3
)


(1415.0
)%Distribution Group


7.1



23.6



(16.5
)


(69.9
)%Total consolidated operating income (loss)

$
(87.3
)

$
87.4


$
(174.7
)


(199.9
)%     ®
    Other Income.
  Interest Income and Interest Expense.
 25




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##### Table of Contents



Provision for (Benefit from) Income Tax.
  Duty
    Drawback Investigation
               26




---



##### Table of Contents



Liquidity
    and Capital Resources
            
    Our leverage ratio (the ratio of Net Debt to Consolidated
    EBITDA, as defined in the Credit Agreement) was (3.3) at
    December 31, 2010. If this ratio were to exceed 3.25 to 1,
    we would be in default under our Credit Agreement and our
    ability to borrow under our Credit Agreement would be impaired.
    Our interest coverage ratio (the ratio of Consolidated EBITDA to
    Net Interest, as defined in the Credit Agreement) was 132.8 at
    December 31, 2010. If this ratio were to fall below 2.0 to
    1, we would be in default under our Credit Agreement and our
    ability to borrow under the Credit Agreement would be impaired. 27




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Cash provided by operating activities.
    Cash provided by (used in) investing
    activities.
    Cash provided by (used in) financing
    activities.
    Backlog. ®
 28




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##### Table of Contents



Contractual
    Obligations, Commitments and Other Post-Retirement
    Benefits
    Contractual Obligations2011


2012


2013


2014


2015


Thereafter


TotalConvertible notes(1)

$
6.9


$
6.9


$
6.9


$
6.9


$
236.9


$



$
264.5Operating leases(2)


4.1



3.5



2.5



2.0



3.5



2.9



18.5Total contractual obligations

$
11.0


$
10.4


$
9.4


$
8.9


$
240.4


$
2.9


$
283.0   Commercial CommitmentsAmount of Commitment Expiration per Period2011


2012


2013


2014


2015


Thereafter


TotalLong-term supply agreements(3)(7)(8)

$
49.0


$
70.4


$
106.1


$
100.6


$
95.6


$
315.7


$
737.4Purchase obligations(4)


97.4



25.0



















122.4Standby letters of credit(5)


3.5























3.5Total commercial commitments

$
149.9


$
95.4


$
106.1


$
100.6


$
95.6


$
315.7


$
863.3   Other Post-Retirement Benefits2011


2012


2013


2014


2015


2016-2020


TotalOther post-retirement benefits(6)

$
3.1


$
3.4


$
3.6


$
3.5


$
3.7


$
17.0


$
34.3   Tax Obligations2011

2012

2013

2014

2015

Thereafter

TotalFIN 48 tax obligations(9)

$



$



$



$



$



$
4.8


$
4.8     (1)
    
    See Note 13 to the Companys accompanying Consolidated
    Financial Statements.(2)
    
    See Note 8 to the Companys accompanying Consolidated
    Financial Statements.(3)
    
    Amounts represent commitments for which contractual terms exceed
    twelve months.(4)
    
    Amounts primarily represent purchase commitments under purchase
    orders.(5)
    
    Amounts represent standby letters of credit primarily related to
    commercial performance and insurance guarantees.(6)
    
    The Company does not fund its other post-retirement employee
    benefits obligation but instead pays amounts when billed.
    However, these estimates are based on current benefit plan
    coverage and are not contractual commitments in as much as the
    Company retains the right to modify, reduce, or terminate any
    such coverage in the future. Amounts shown in the years 2011
    through 2020 are based on actuarial estimates of expected future
    cash payments, and exclude the impacts of benefits associated
    with the Medicare Part D Act of 2003.(7)
    
    In February 2007, the Company entered into a new contract for
    the long-term supply of titanium sponge, the primary raw
    material for our Titanium Group, with a Japanese supplier. This
    agreement, which began in 2009, runs through 2016 and provides
    the Company with supply ranging up to 13.5 million pounds
    of titanium sponge annually. For the remaining term of this
    agreement the Company has agreed to purchase a certain minimum
    of titanium sponge annually, ranging from 6.25 million to
    9 million pounds. During the latter years of the contract,
    quantities can be reduced by the election of various options by
    both parties. Future obligations were determined based on
    current prices as prices are negotiated annually. Purchases
    under the contract are denominated in U.S. Dollars.(8)
    
    In December 2009, the Company entered into two new contracts
    with two Japanese suppliers for the long-term supply of titanium
    sponge for delivery between 2012 and 2021. The contracts provide
    the Company with the supply of up to 19.2 million pounds of
    titanium sponge annually. The price of the titanium sponge is
    fixed, subject to certain underlying input cost adjustments and
    potential price adjustments based on the Yen to U.S. Dollar
    exchange rate. Future obligations were determined based on the
    fixed price and minimum volumes. 29




---



##### Table of Contents



(9)
    
    These amounts are included in the Thereafter column
    as it cannot be reasonably estimated when these amounts may be
    settled.  Off-Balance
    Sheet Arrangements
    Credit
    Agreements
    New
    Accounting Standards
             30




---



##### Table of Contents



No. 2009-13,
  No. 2010-17,
  Critical
    Accounting Policies
      Inventories. last-in, first-in, lower-of-cost-or-market
  Goodwill and Intangible Assets.
   31




---



##### Table of Contents



Excess of FairValue over(in 000s)

Goodwill


Carrying ValueTitanium reporting unit

$
2,548



69
%Fabrication reporting unit


28,958



30
%U.S. Distribution reporting unit


6,856



5
%Europe Distribution reporting unit


2,977



43
%Energy Fabrication reporting unit






N/ATotal Goodwill

$
41,339     ®
     32




---



##### Table of Contents



®
  Long-Lived Assets.
    Income Taxes.
    Employee Benefit Plans.
  Dedicated
    Bond Portfolio
 33




---



##### Table of Contents



−.25%

+.25%Effect on total projected benefit obligation (PBO) (in millions)

$
3.3


$
(3.3
)Effect on subsequent years periodic pension expense (in millions)

$
0.5


$
(0.5
)     −.25%


+.25%Effect on subsequent years periodic pension expense (in millions)

$
0.2


$
(0.2
)     Investment category (in
    $000s)

2010


2009U.S. government securities

$
13,300


$
16,755Corporate bonds


23,637



18,823Equities


53,282



49,083Short-term investment funds


2,490



3,680Real estate funds


1,888



1,176Other investments  Timberlands


1,600



1,539Total

$
96,197


$
91,056     Investment Category

2010Equity securities


55
%Debt securities and other short-term investments


43
%Cash


2
%Total


100
%      34




---



##### Table of Contents



Post-Retirement

Post-RetirementPension

Benefit Plan

Benefit Plan (notBenefit

(including Plan D

including Plan DPlans

subsidy)

subsidy)2011

$
8.7


$
3.1


$
3.22012


8.9



3.4



3.62013


9.0



3.6



3.82014


9.3



3.5



3.82015


9.3



3.7



4.02016 to 2020


49.5



17.0



18.7       Environmental Liabilities.
       35




---



##### Table of Contents



Item 7A.  Quantitative
    and Qualitative Disclosures About Market Risk.  Commodity
    Price Risk
    Interest
    Rate Risk
    Foreign
    Currency Exchange Risk
  non-U.S. Dollar
  non-U.S. Dollar
   36




---



##### 



Item 8.
    Financial
    Statements and Supplementary Data.  Index to
    Financial Statements
   
 PageReport of Independent Registered Public
    Accounting Firm


38Financial Statements:Consolidated Statements of Operations for the
    years ended December 31, 2010, 2009, and 2008


39Consolidated Balance Sheets at December 31, 2010
    and 2009


40Consolidated Statements of Cash Flows for the
    years ended December 31, 2010, 2009, and 2008


41Consolidated Statements of Comprehensive Income
    and Shareholders Equity for the years ended December 31,
    2010, 2009, and 2008


42Notes to Consolidated Financial Statements


43Financial Statement Schedules:Schedule II  Valuation and
    Qualifying Accounts


S-1     37




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##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM    Internal Control  Integrated
    Framework
        
   38




---



##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Consolidated
    Statements of Operations
  (In
    thousands, except share and per share amounts)
  Years Ended December 31,2010


2009


2008Net sales

$
431,793


$
407,978


$
609,900Cost and expenses:Cost of sales


355,908



352,167



442,626Selling, general, and administrative expenses


63,580



63,490



77,762Research, technical, and product development expenses


3,256



2,001



2,120Asset and asset-related charges (income)


(5,012
)


68,897



Goodwill impairment






8,699



Operating income (loss)


14,061



(87,276
)


87,392Other income (expense)


(622
)


2,056



1,527Interest income


492



1,511



3,262Interest expense


(2,111
)


(12,347
)


(4,206
)Income (loss) before income taxes


11,820



(96,056
)


87,975Provision for (benefit from) income taxes


8,403



(28,817
)


32,280Net income (loss)

$
3,417


$
(67,239
)

$
55,695Earnings (loss) per share:Basic

$
0.11


$
(2.67
)

$
2.42Diluted

$
0.11


$
(2.67
)

$
2.41Weighted-average shares outstanding:Basic


29,916,465



25,029,976



22,872,075Diluted


30,145,099



25,029,976



22,987,503   The accompanying notes are an integral part of these
    Consolidated Financial Statements.
 39




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIESConsolidated Balance Sheets 
    (In thousands, except share and per share amounts)
  December 31,2010


2009ASSETSCurrent assets:Cash and cash equivalents

$
376,951


$
56,216Short-term investments


20,275



65,042Receivables, less allowance for doubtful accounts of $478 and
    $646


56,235



60,924Inventories, net


269,719



266,887Deferred income taxes


22,891



21,237Other current assets


16,299



21,410Total current assets


762,370



491,716Property, plant, and equipment, net


260,576



252,301Goodwill


41,795



41,068Other intangible assets, net


14,066



14,299Deferred income taxes


21,699



53,814Other noncurrent assets


6,348



1,537Total assets

$
1,106,854


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

$
47,226


$
39,193Accrued wages and other employee costs


21,951



9,796Unearned revenues


28,358



21,832Other accrued liabilities


28,179



33,134Total current liabilities


125,714



103,955Long-term debt


178,107



81Liability for post-retirement benefits


39,903



34,530Liability for pension benefits


33,830



28,102Deferred income taxes


3,147



244Other noncurrent liabilities


7,753



8,617Total liabilities


388,454



175,529Commitments and ContingenciesShareholders equity:Common stock, $0.01 par value; 50,000,000 shares
    authorized; 30,858,725 and 30,724,351 shares issued;
    30,123,519 and 30,010,998 shares outstanding


309



307Additional paid-in capital


474,277



439,361Treasury stock, at cost; 735,206 and 713,353 shares


(17,363
)


(16,996
)Accumulated other comprehensive loss


(32,337
)


(33,563
)Retained earnings


293,514



290,097Total shareholders equity


718,400



679,206Total liabilities and shareholders equity

$
1,106,854


$
854,735   The accompanying notes are an integral part of these
    Consolidated Financial Statements.
 40




---



##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIESConsolidated Statements of Cash
    Flows 
    (In thousands)
  Years Ended December 31,2010


2009


2008OPERATING ACTIVITIES:Net income (loss)

$
3,417


$
(67,239
)

$
55,695Adjustment for non-cash items:Depreciation and amortization


22,111



21,163



20,201Asset and asset-related charges (income)


(2,738
)


68,897



Goodwill impairment






8,699



Deferred income taxes


16,039



(29,479
)


(18,186
)Stock-based compensation


3,847



4,399



5,155Excess tax benefits from stock-based compensation activity


(380
)


(39
)


(215
)(Gain) loss on disposal of property, plant, and equipment


(1,362
)


127



2Bad debt expense


193



194



1,722Changes in assets and liabilities:Receivables


4,058



20,679



13,972Inventories


(2,972
)


11,325



13,138Accounts payable


2,126



8,785



(6,352
)Income taxes payable


223



(713
)


644Deferred revenue


10,505



(2,150
)


4,690Other current assets and liabilities


17,776



(17,338
)


(6,972
)Other assets and liabilities


2,365



5,689



(535
)Cash provided by operating activities


75,208



32,999



82,959INVESTING ACTIVITIES:Proceeds from disposal of property, plant, and equipment


4,011



22



Purchase of short-term investments


(234
)


(105,000
)


Proceeds from maturity of short-term investments


45,000



40,000



Capital expenditures


(28,632
)


(82,285
)


(125,590
)Cash provided by (used in) investing activities


20,145



(147,263
)


(125,590
)FINANCING ACTIVITIES:Proceeds from exercise of employee stock options


1,095



120



137Borrowings on long-term debt


230,000



1,181



227,050Repayments on long-term debt


(36
)


(243,455
)


(1,081
)Excess tax benefits from stock-based compensation activity


380



39



215Purchase of common stock held in treasury


(367
)


(105
)


(9,090
)Proceeds from equity offering, net






127,423



Proceeds from government grants










2,842Financing fees


(7,249
)


(300
)


(1,313
)Cash provided by (used in) financing activities


223,823



(115,097
)


218,760Effect of exchange rate changes on cash and cash equivalents


1,559



1,128



815Increase (decrease) in cash and cash equivalents


320,735



(228,233
)


176,944Cash and cash equivalents at beginning of period


56,216



284,449



107,505Cash and cash equivalents at end of period

$
376,951


$
56,216


$
284,449Supplemental cash flow information:Cash paid for interest

$
588


$
11,693


$
4,076Cash paid (refund received) for income taxes

$
(8,141
)

$
6,092


$
61,705Non-cash investing and financing activities:Issuance of common stock for restricted stock awards

$
1,712


$
1,826


$
3,125Capital lease obligations incurred

$



$



$
13   The accompanying notes are an integral part of these
    Consolidated Financial Statements.
 41




---



##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIESConsolidated Statements of Comprehensive Income and
    Shareholders Equity 
    (In thousands, except share and per share amounts, unless
    otherwise indicated)
  Accumulated OtherComprehensive Income(Loss)Net Unrealized Gain(Loss) FromCommon Stock


Additional











Avail.


Minimum


ForeignShares





Paid-In


Treasury


Retained


Derivative


For Sale


Pension


CurrencyOutstanding


Amount


Capital


Stock


Earnings


Instruments


Investments


Liability


Translation


TotalBalance at December 31, 2007


23,105,708


$
236


$
302,075


$
(7,801
)

$
301,641


$



$



$
(30,372
)

$
10,005


$
575,784Net income


















55,695



















55,695Foreign currency translation


































(13,711
)


(13,711
)Unrecognized losses on derivatives (interest rate swaps), net of
    tax






















(3,325
)














(3,325
)Change in unrecognized losses and prior service costs related to
    pension and postretirement benefit plans, net of tax






























(8,949
)






(8,949
)Comprehensive income






































29,710Shares issued for directors compensation


11,912



































Shares issued for restricted stock award plans


53,750



1































1Stock-based compensation expense recognized










5,155



























5,155Treasury stock purchased at cost


(178,836
)










(9,090
)






















(9,090
)Exercise of employee options


11,602







137



























137Tax benefits from stock-based compensation activity










237



























237Balance at December 31, 2008


23,004,136


$
237


$
307,604


$
(16,891
)

$
357,336


$
(3,325
)

$



$
(39,321
)

$
(3,706
)

$
601,934Net loss


















(67,239
)


















(67,239
)Foreign currency translation


































10,033



10,033Unrecognized gains on investments


























42











42Unrecognized gains on derivatives (interest rate swaps), net of
    tax






















516















516Recognized losses on derivatives (interest rate swaps), net of
    tax






















2,809















2,809Benefit plan amortization






























(611
)






(611
)Comprehensive income






































(54,450
)Shares issued for directors compensation


35,911



































Shares issued for performance share award plans


53



































Shares issued for restricted stock award plans


89,360



1































1Stock-based compensation expense recognized










4,399



























4,399Shares issued for equity offering


6,900,000



69



127,647



























127,716Treasury stock purchased at cost


(6,823
)










(105
)






















(105
)Exercise of employee options


11,070







120



























120Forfeiture of restricted stock awards


(22,709
)


































Tax benefits from stock-based compensation activity










(409
)


























(409
)Balance at December 31, 2009


30,010,998


$
307


$
439,361


$
(16,996
)

$
290,097


$



$
42


$
(39,932
)

$
6,327


$
679,206Net Income


















3,417



















3,417Foreign currency translation


































5,981



5,981Unrealized loss on investments


























(15
)










(15
)Benefit plan amortization






























(4,740
)






(4,740
)Comprehensive income






































4,643Shares issued for directors compensation


16,763



































Shares issued for restricted stock award plans


49,770



1































1Stock-based compensation expense recognized










3,847



























3,847Treasury stock purchased at cost


(14,053
)










(367
)






















(367
)Exercise of employee options


62,757



1



1,096



























1,097Forfeiture of restricted stock awards


(7,800
)


































Tax benefits from stock-based compensation activity










54



























54Shares issued for employeestock purchase plan


5,084







131



























131Equity component of convertible debt, net of deferred taxes










29,788



























29,788Balance at December 31, 2010


30,123,519


$
309


$
474,277


$
(17,363
)

$
293,514


$



$
27


$
(44,672
)

$
12,308


$
718,400   The accompanying notes are an integral part of these
    Consolidated Financial Statements.
 42




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes
    to Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
  Note 1ORGANIZATION
    AND OPERATIONS:
          sub-assemblies,
  cuts-to-size, just-in-time
    Note 2SUMMARY
    OF SIGNIFICANT ACCOUNTING POLICIES:
  Principles
    of consolidation:
    Use of
    estimates:
   43




---



##### Table of Contents



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


SignificantQuoted Market


Other Observable


UnobservablePrices


Inputs


Inputs(Level 1)


(Level 2)


(Level 3)


TotalCash and cash equivalents

$
376,951


$



$



$
376,951Short-term investments


20,275











20,275Total

$
397,226


$



$



$
397,226         Cash
    equivalents:
   44




---



##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
  Short-term
    investments:
    December 31,2010


2009Certificates of deposit

$



$
45,000Ultra short-term municipal bond funds


20,275



20,042Total short-term investments

$
20,275


$
65,042   available-for-sale,
  Receivables:
    December 31,2010


2009Trade and commercial customers

$
56,713


$
61,570Less: Allowance for doubtful accounts


(478
)


(646
)Total receivables

$
56,235


$
60,924   Inventories:
  last-in, first-in, lower-of-cost-or-market
    December 31,2010


2009Raw materials and supplies

$
118,031


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


211,001



197,840LIFO reserve


(59,313
)


(76,015
)Total inventories

$
269,719


$
266,887    45




---



##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
  Property,
    plant, and equipment:
      December 31,2010


2009Land

$
5,614


$
5,647Buildings and improvements


70,911



70,183Machinery and equipment


263,994



247,843Computer hardware and software, furniture and fixtures, and other


59,125



53,004Construction-in-progress


107,437



101,028$
507,081


$
477,705Less: Accumulated depreciation


(246,505
)


(225,404
)Total property, plant, and equipment, net

$
260,576


$
252,301     Buildings and improvements

20-40 yearsMachinery and equipment

7-15 yearsFurniture and fixtures

5-10 yearsComputer hardware and software

3-10 years         Goodwill
    and intangible assets:
     46




---



##### Table of Contents



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

$
2,548Fabrication reporting unit


28,958U.S. Distribution reporting unit


6,856Europe Distribution reporting unit


2,977Energy Fabrication reporting unit


Total Goodwill

$
41,339           Titanium reporting unit


14.0
%Fabrication reporting unit


14.0
%U.S. Distribution reporting unit


12.0
%Europe Distribution reporting unit


11.0
%Energy Fabrication reporting unit


N/A    47




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
    Excess of FairValue over CarryingValueTitanium reporting unit


69
%Fabrication reporting unit


30
%U.S. Distribution reporting unit


5
%Europe Distribution reporting unit


43
%Energy Fabrication reporting unit


N/A     ®
    Titanium


Fabrication


Distribution


TotalGroup


Group


Group


GoodwillDecember 31, 2008

$
2,548


$
35,603


$
9,833


$
47,984Impairment






(8,699
)






(8,699
)Translation adjustment






1,783







1,783December 31, 2009


2,548



28,687



9,833



41,068Translation adjustment






727







727December 31, 2010

$
2,548


$
29,414


$
9,833


$
41,795   Intangibles.
 48




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
    IntangibleAssetsDecember 31, 2008

$
13,196Amortization


(891
)Translation adjustment


1,994December 31, 2009


14,299Amortization


(984
)Translation adjustment


751December 31, 2010

$
14,066   Other
    long-lived assets:
    Environmental:
  site-by-site
  Treasury
    stock:
    Revenue
    and cost recognition:
       49




---



##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
  Shipping
    and handling fees and costs:
    Research
    and development:
    Pensions:
      Other
    post-retirement benefits:
        Income
    taxes:
       50




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
    Foreign
    currencies:
        Derivative
    financial instruments:
      Stock-based
    compensation:
   51




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
        New
    Accounting Standards:
             52




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RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
        Note 3ASSET
    AND ASSET-RELATED CHARGES (INCOME):
     53




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
    Sponge-plantContractualCommitmentsBalance as of December 31, 2009

$
7,809Settlements/adjustments


(5,161
)Payments


(1,402
)Balance as of December 31, 2010

$
1,246     Note 4EARNINGS
    PER SHARE:
       54




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
    Years Ended December 31,2010


2009


2008Numerator:Net income

$
3,417


$
(67,239
)

$
55,695Denominator:Basic weighted-average shares outstanding


29,916,465



25,029,976



22,872,075Effect of dilutive shares


228,634







115,428Diluted weighted-average shares outstanding


30,145,099



25,029,976



22,987,503Earnings (loss) per share:Basic

$
0.11


$
(2.67
)

$
2.42Diluted

$
0.11


$
(2.67
)

$
2.41     Note 5INCOME
    TAXES:
    December 31, 2010


December 31, 2009


December 30, 2008Current


Deferred


Total


Current


Deferred


Total


Current


Deferred


TotalFederal

$
(10,554
)

$
21,502


$
10,948


$
(2,270
)

$
(21,388
)

$
(23,658
)

$
42,189


$
(10,100
)

$
32,089State


1,089



1,693



2,782



967



(944
)


23



5,445



(3,474
)


1,971Foreign


1,829



(7,156
)


(5,327
)


1,965



(7,147
)


(5,182
)


2,832



(4,612
)


(1,780
)Total

$
(7,636
)

$
16,039


$
8,403


$
662


$
(29,479
)

$
(28,817
)

$
50,466


$
(18,186
)

$
32,280     Years Ended December 31,2010


2009


2008United States

$
34,623


$
(74,039
)

$
103,045Foreign


(22,803
)


(22,017
)


(15,070
)Income (loss) before income taxes

$
11,820


$
(96,056
)

$
87,975  55




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
    Years Ended December 31,2010


2009


2008Statutory rate of 35% applied to income (loss) before income
    taxes

$
4,137


$
(33,620
)

$
30,791Effects of foreign operations


1,771



1,539



1,439State income taxes, net of federal tax effects


1,729



(66
)


1,017Repeal of Medicare Part D subsidy


1,592







Adjustments of tax reserves and prior years income taxes


(1,083
)


2,619



950Manufacturing deduction










(2,161
)Other


257



711



244Total provision

$
8,403


$
(28,817
)

$
32,280Effective tax rate


71.1
%


30.0
%


36.7
%         December 31,2010


2009Deferred tax assets:Inventories

$
11,931


$
9,091Postretirement benefit costs


15,898



15,613Employment costs


8,306



7,654Duty drawback claims


1,757



2,052Canadian tax loss carryforwards (expiring 2014 through 2030)


27,292



19,368Pension costs


8,049



6,917State tax loss carryforwards (expiring 2023 through 2030)


5,113



1,498Start-up
    costs


8,108



6,606Asset and asset-related impairment


410



24,890Other


3,637



3,430Total deferred tax assets


90,501



97,119Valuation Allowance


(4,332
)


(4,066
)Net deferred tax assets


86,169



93,053Deferred tax liabilities:Property, plant and equipment


(19,648
)


(14,140
)Intangible assets


(3,019
)


(3,045
)Convertible debt


(21,424
)


Other


(648
)


(1,069
)Total deferred tax liabilities


(44,739
)


(18,254
)Net deferred tax asset

$
41,430


$
74,799  56




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
          Unrecognized TaxBenefits2010


2009


2008Gross balance at January 1

$
5,577


$
3,250


$
2,481Prior period tax positionsIncreases


1,292



1,952



9Decreases


(2,546
)


(174
)


(160
)Current period tax positions


949



1,110



920Lapse of Statute






(561
)


Settlements with tax authorities


(455
)






Gross balance at December 31

$
4,817


$
5,577


$
3,250Amount that would affect the effective tax rate if recognized

$
4,575


$
5,278


$
3,095        57




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
  Note 6OTHER
    INCOME (EXPENSE):
    Note 7EMPLOYEE
    BENEFIT PLANS:
     58




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
    Post-RetirementPension Benefit Plans


Benefit Plan2010


2009


2010


2009Change in projected benefit obligation:Projected benefit obligation at beginning of year

$
119,298


$
109,187


$
37,006


$
33,364Service cost


1,806



1,591



711



511Interest cost


7,078



7,046



2,200



2,138Actuarial loss


10,017



9,229



4,752



2,947Amendment














Benefits paid


(7,924
)


(7,755
)


(2,695
)


(2,936
)Plan participants contributions










814



827Medicare retiree drug subsidy received










167



155Projected benefit obligation at end of year

$
130,275


$
119,298


$
42,955


$
37,006Change in plan assets:Fair value of plan assets at beginning of year

$
91,056


$
82,531


$



$
Actual return on plan assets


10,055



13,680







Employer contributions


3,010



2,600



1,714



1,954Medicare retiree drug subsidy received










167



155Reimbursement to trust














Plan participants contributions










814



827Benefits paid


(7,924
)


(7,755
)


(2,695
)


(2,936
)Fair value of plan assets at end of year

$
96,197


$
91,056


$



$
Funded status

$
(34,078
)

$
(28,242
)

$
(42,956
)

$
(37,006
)Amounts recognized in the Consolidated Balance Sheets consisted
    of:Current liabilities

$
(248
)

$
(140
)

$
(3,053
)

$
(2,476
)Noncurrent liabilities


(33,830
)


(28,102
)


(39,903
)


(34,530
)Net amount recognized

$
(34,078
)

$
(28,242
)

$
(42,956
)

$
(37,006
)     December 31,


December 31,2010


2009


2010


2009Net actuarial loss (gain)

$
61,520


$
56,887


$
6,116


$
5,544Prior service cost


1,861



2,384



4,330



1,364Total, before tax effect

$
63,381


$
59,271


$
10,446


$
6,908  59




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
  Post-RetirementPension Benefit Plans


Benefit Plan2010


2009


2010


2009Weighted-average assumptions used to determine benefit
    obligation at December 31:Discount rate


5.70%



6.15%



5.70%



6.15%Rate of increase to compensation levels


3.80%



3.80%



N/A



N/AMeasurement date


12/31/2010



12/31/2009



12/31/2010



12/31/2009Weighted-average assumptions used to determine net periodic
    benefit obligation cost for the years ended December 31:Discount rate


6.15%



6.70%



6.15%



6.70%Expected long-term return on plan assets


7.50%



7.50%



N/A



N/ARate of increase to compensation levels


3.80%



3.80%



N/A



N/A       −.25%

+.25%Effect on subsequent years periodic pension expense (in millions)

+$
0.2


−$
0.2   Dedicated Bond Portfolio
    −0.25%

+0.25%Effect on total projected benefit obligation (PBO) (in millions)

+$
3.3


−$
3.3Effect on subsequent years periodic pension expense (in millions)

+$
0.5


−$
0.5  60




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##### Table of Contents



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


Post-Retirement Benefit Plan2010


2009


2008


2010


2009


2008Service cost

$
1,806


$
1,591


$
1,941


$
711


$
511


$
517Interest cost


7,078



7,046



7,130



2,200



2,138



2,022Expected return on plan assets


(7,478
)


(7,717
)


(8,874
)










Prior service cost amortization


523



836



824



1,214



1,214



1,214Amortization of actuarial loss


2,809



1,921



2,148











Settlement charges










2,044











Net periodic benefit cost

$
4,738


$
3,677


$
5,213


$
4,125


$
3,863


$
3,753           Investment category (in
    $000s)

2010


2009U.S. government securities

$
13,300


$
16,755Corporate bonds


23,637



18,823Equities


53,282



49,083Short-term investment funds


2,490



3,680Real estate funds


1,888



1,176Other investments  Timberlands


1,600



1,539Total

$
96,197


$
91,056     Investment Category

2010Equity securities


55
%Debt and other short-term investments


43
%Cash


2
%Total


100
%    61




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##### Table of Contents



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


SignificantQuoted Market


Other Observable


UnobservablePrices


Inputs


Inputs(Level 1)


(Level 2)


(Level 3)


TotalU.S. government securities

$



$
13,300


$



$
13,300Corporate bonds






23,637







23,637Equities






50,384



2,898



53,282Short-term investment funds


2,490











2,490Real estate funds










1,888



1,888Other investments  Timberlands










1,600



1,600Total assets

$
2,490


$
87,321


$
6,386


$
96,197   Level 1
    Fair Value Measurements:
  Short-term Investment Funds 
  Level 2
    Fair Value Measurements:
  U.S. Government Securities and Common Stock 
  Corporate Bonds and U.S. Government
    Securities 
  Equities 
  Level 3
    Fair Value Measurements:
  Common Stock (Private Equity Funds) and Real Estate
    Funds 
 62




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
  Timberlands  50-year
    Private


Real EstateEquity Funds


Funds


Timberlands


TotalBeginning balance

$
1,889


$
1,176


$
1,539


$
4,604Realized gains/losses


43



23







66Unrealized gain/losses relating to investments still held at
    December 31, 2010


493



3



61



557Purchases, sales, issuances, and
    settlements-net


473



686







1,159Ending Balance

$
2,898


$
1,888


$
1,600


$
6,386   Other post-retirement benefit plans. out-of-pocket
      Post-Retirement

Post-RetirementPension

Benefit Plan

Benefit Plan (notBenefit

(including Plan D

including Plan DPlans

subsidy)

subsidy)2011

$
8,728


$
3,052


$
3,2292012


8,935



3,416



3,6102013


8,985



3,597



3,8092014


9,250



3,525



3,7602015


9,251



3,744



3,9972016 to 2020


49,462



17,029



18,666     Supplemental pension plan.
  Excess pension plan.
 63




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
    Employee Stock Purchase Plan.
    Note 8
    LEASES:      Operating


Capital2011

$
4,108


$
132012


3,530



52013


2,459



2014


2,049



2015


3,518



Thereafter


2,928



Total lease payments

$
18,592



18Less: Interest portion






(1
)Amount recognized as capital lease obligations





$
17   Note 9
    UNEARNED
    REVENUE:    Note 10
    TRANSACTIONS
    WITH RELATED PARTIES:    Note 11
    SEGMENT
    REPORTING:   64




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
      cuts-to-size, just-in-time
   65




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
    Years Ended December 31,2010


2009


2008Net sales:Titanium Group

$
142,920


$
107,622


$
202,024Intersegment sales


87,257



121,664



151,910Total Titanium Group sales


230,177



229,286



353,934Fabrication Group


134,418



106,231



146,816Intersegment sales


52,589



57,378



79,027Total Fabrication Group sales


187,007



163,609



225,843Distribution Group


154,455



194,125



261,060Intersegment sales


4,148



2,230



2,628Total Distribution Group sales


158,603



196,355



263,688Eliminations


(143,994
)


(181,272
)


(233,565
)Total consolidated net sales

$
431,793


$
407,978


$
609,900Operating income (loss):Titanium Group before corporate allocations

$
27,217


$
(57,849
)

$
76,883Corporate allocations


(8,813
)


(10,236
)


(15,123
)Total Titanium Group operating income (loss)


18,404



(68,085
)


61,760Fabrication Group before corporate allocations


4,453



(16,796
)


12,781Corporate allocations


(12,055
)


(9,533
)


(10,744
)Total Fabrication Group operating income (loss)


(7,602
)


(26,329
)


2,037Distribution Group before corporate allocations


10,039



14,716



32,561Corporate allocations


(6,780
)


(7,578
)


(8,966
)Total Distribution Group operating income


3,259



7,138



23,595Total consolidated operating income (loss)

$
14,061


$
(87,276
)

$
87,392  66




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
  Years Ended December 31,2010


2009


2008Revenue by Market Information:Titanium GroupCommercial aerospace

$
76,064


$
46,309


$
123,904Defense


36,430



43,109



60,829Industrial and consumer


30,426



18,204



17,291Total Titanium Group net sales


142,920



107,622



202,024Fabrication GroupCommercial aerospace

$
73,446


$
40,212


$
55,691Defense


24,648



29,209



28,193Industrial and consumer


36,324



36,810



62,932Total Fabrication net sales


134,418



106,231



146,816Distribution GroupCommercial aerospace

$
78,376


$
93,250


$
126,116Defense


67,493



92,080



116,838Industrial and consumer


8,586



8,795



18,106Total Distribution Group net sales


154,455



194,125



261,060Total consolidated net sales

$
431,793


$
407,978


$
609,900Geographic location of trade sales:United States

$
284,233


$
261,300


$
418,658France


40,683



49,475



62,929England


44,124



34,100



39,084Germany


24,516



27,246



26,143Canada


9,399



14,074



20,221Spain


5,236



6,510



6,627Italy


5,828



4,335



5,997Japan


7,821



1,657



11,894Other countries


9,953



9,281



18,347Total trade sales

$
431,793


$
407,978


$
609,900Capital expenditures:Titanium Group

$
23,561


$
72,583


$
107,157Fabrication Group


4,233



9,243



17,410Distribution Group


838



459



1,023Total capital expenditures

$
28,632


$
82,285


$
125,590Depreciation and amortization:Titanium Group

$
13,004


$
12,694


$
11,624Fabrication Group


8,324



7,636



7,736Distribution Group


783



833



841Total depreciation and amortization

$
22,111


$
21,163


$
20,201  67




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
    December 31,2010


2009


2008Property, plant, and equipment:United States

$
435,010


$
409,121


$
418,135England


5,302



4,791



4,761France


832



1,470



1,437Canada


65,938



62,323



52,038Less: Accumulated depreciation


(246,506
)


(225,404
)


(205,309
)Property, plant, and equipment, net

$
260,576


$
252,301


$
271,062Total assets:Titanium Group

$
367,591


$
365,725


$
374,999Fabrication Group


246,830



239,847



224,534Distribution Group


120,935



140,666



155,838General corporate assets


371,498



108,497



273,832Total consolidated assets

$
1,106,854


$
854,735


$
1,029,203       Note 12
    COMMITMENTS
    AND CONTINGENCIES:    Tronox
    LLC Litigation
   68




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
  and/or
      Duty
    Drawback Investigation
           69




---



##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
        Environmental
    Matters
       70




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
    EnvironmentalLiabilitiesBalance at December 31, 2009

$
(1,546
)Environmental-related expense


(2
)Cash paid


145Balance at December 31, 2010

$
(1,403
)     Other
    Matters
    Note 13
    LONG-TERM
    DEBT:    December 31,2010


2009RTI convertible debt due December 2015

$
178,062


$
Other


45



81Total debt

$
178,107


$
81          71




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
          Note 14
    STOCK
    OPTIONS AND RESTRICTED STOCK AWARD PLANS:       72




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
    2010


2009


2008Risk-free interest rate


2.26
%


1.85
%


2.81
%Expected dividend yield


0.00
%


0.00
%


0.00
%Expected lives (in years)


4.0



4.0



4.0Expected volatility


66.00
%


58.00
%


41.00
%       Weighted-Weighted-


AverageAverage


Remaining


AggregateExercise Price


Contractual


IntrinsicStock Options

Shares


Per Share


Term (Years)


ValueOutstanding at December 31, 2009


475,581


$
31.22Granted


114,830



25.08Forfeited


(12,470
)


20.30Expired


(17,498
)


42.97Exercised


(62,757
)


15.38Outstanding at December 31, 2010


497,686


$
31.66



6.60


$
2,957Exercisable at December 31, 2010


279,355


$
39.12



5.06


$
1,518      73




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
    Weighted-AverageGrant-DateFair ValueNonvested Restricted Stock Awards

Shares


Per ShareNonvested at December 31, 2009


171,387


$
28.34Granted


66,533



25.73Vested


(75,831
)


27.04Forfeited


(7,800
)


25.31Nonvested at December 31, 2010


154,289


$
28.00       Performance
    Share Awards
      Awards


Maximum SharesPerformance Share Awards

Activity


Eligible to ReceiveOustanding at December 31, 2009


73,380



146,760Granted


49,450



98,900Forfeited


(9,400
)


(18,800
)Outstanding at December 31, 2010


113,430



226,860    74




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
  Note 15
    GUARANTOR
    SUBSIDIARIES:        Condensed
    Consolidating Statement of Operations
 Year Ended December 31, 2010
  RTIInternational


Guarantor


Non-GuarantorMetals, Inc.


Subsidiaries


Subsidiaries


Eliminations


ConsolidatedNet sales(1)

$
12,372


$
253,754


$
279,730


$
(114,063
)

$
431,793Costs and expenses:Cost of sales






221,351



248,620



(114,063
)


355,908Selling, general, and administrative expenses(2)


9,300



9,966



44,314







63,580Research, technical, and product development expenses






3,256











3,256Asset and asset-related charges (income)










(5,012
)






(5,012
)Operating income (loss)


3,072



19,181



(8,192
)






14,061Other income (expense)


(52
)


(91
)


(479
)






(622
)Interest income (expense)


(2,650
)


4,615



(3,584
)






(1,619
)Equity in earnings of subsidiaries


5,701











(5,701
)


Income (loss) before income taxes


6,071



23,705



(12,255
)


(5,701
)


11,820Provision for (benefit from) income taxes


2,654



7,444



(1,695
)






8,403Net income (loss)

$
3,417


$
16,261


$
(10,560
)

$
(5,701
)

$
3,417     (1)
    
    During the year ended December 31, 2010, the parent company
    recorded net sales related to the March 2010 settlement of
    Airbus 2009 contractual obligations.(2)
    
    The parent company charges a management fee to the subsidiares
    based upon its budgeted annual expenses. 75




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
   Condensed
    Consolidating Statement of Operations
    Year Ended December 31, 2009
  RTIInternational


Guarantor


Non-GuarantorMetals, Inc.


Subsidiaries


Subsidiaries


Eliminations


ConsolidatedNet sales

$



$
250,618


$
293,841


$
(136,481
)

$
407,978Costs and expenses:Cost of sales






224,918



263,730



(136,481
)


352,167Selling, general, and administrative expenses(1)


(8,457
)


23,311



48,636







63,490Research, technical, and product development expenses






2,001











2,001Asset and asset-related charges (income)










68,897







68,897Goodwill impairment










8,699







8,699Operating income (loss)


8,457



388



(96,121
)






(87,276
)Other income (expense)


1,734



139



183







2,056Interest income (expense)


(15,781
)


11,051



(6,106
)






(10,836
)Equity in earnings of subsidiaries


(58,484
)










58,484



Income (loss) before income taxes


(64,074
)


11,578



(102,044
)


58,484



(96,056
)Provision for (benefit from) income taxes


3,165



1,611



(33,593
)






(28,817
)Net income (loss)

$
(67,239
)

$
9,967


$
(68,451
)

$
58,484


$
(67,239
)     (1)
    
    The parent company charges a management fee to the subsidiares
    based upon its budgeted annual expenses. A credit in selling,
    general, and administrative expenses (SG&A) for
    the parent company indicates that actual expenses were lower
    than budgeted expenses. A credit in parent company SG&A is
    offset by an equal debit amount in the subsidiaries
    SG&A. 76




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
   Condensed
    Consolidating Statement of Operations
    Year Ended December 31, 2008
  RTIInternational


Guarantor


Non-GuarantorMetals, Inc.


Subsidiaries


Subsidiaries


Eliminations


ConsolidatedNet sales

$



$
390,562


$
396,148


$
(176,810
)

$
609,900Costs and expenses:Cost of sales






295,274



324,162



(176,810
)


442,626Selling, general, and administrative expenses(1)


1,440



25,533



50,789







77,762Research, technical, and product development expenses






2,120











2,120Operating income (loss)


(1,440
)


67,635



21,197







87,392Other income (expense)


(63
)


65



1,525







1,527Interest income (expense)


(3,693
)


9,808



(7,059
)






(944
)Equity in earnings of subsidiaries


57,448











(57,448
)


Income (loss) before income taxes


52,252



77,508



15,663



(57,448
)


87,975Provision for (benefit from) income taxes


(3,443
)


25,601



10,122







32,280Net income (loss)

$
55,695


$
51,907


$
5,541


$
(57,448
)

$
55,695     (1)
    
    The parent company charges a management fee to the subsidiares
    based upon its budgeted annual expenses. 77




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
  Condensed
    Consolidating Balance Sheet
    As of December 31, 2010
  RTIInternational


Guarantor


Non-GuarantorMetals, Inc.


Subsidiaries


Subsidiaries


Eliminations


ConsolidatedASSETSCurrent assets:Cash and cash equivalents

$



$
350,629


$
26,322


$



$
376,951Short-term investments






20,275











20,275Receivables, net


382



39,313



35,519



(18,979
)


56,235Inventories, net






151,544



118,175







269,719Deferred income taxes


21,430



1,419



42







22,891Other current assets


16,489



811



1,069



(2,070
)


16,299Total current assets


38,301



563,991



181,127



(21,049
)


762,370Property, plant, and equipment, net


1,050



198,007



61,519







260,576Goodwill






18,097



23,698







41,795Other intangible assets, net










14,066







14,066Deferred income taxes






24,371



21,765



(24,437
)


21,699Other noncurrent assets


6,168



36



144







6,348Intercompany investments


898,943



71,231



180



(970,354
)


Total assets

$
944,462


$
875,733


$
302,499


$
(1,015,840
)

$
1,106,854LIABILITIES AND SHAREHOLDERS EQUITYCurrent liabilities:Accounts payable

$
15


$
36,441


$
29,749


$
(18,979
)

$
47,226Accrued wages and other employee costs


5,603



7,656



8,692







21,951Unearned revenue










28,358







28,358Other accrued liabilities


2,612



11,037



16,600



(2,070
)


28,179Total current liabilities


8,230



55,134



83,399



(21,049
)


125,714Long-term debt


178,062



40



5







178,107Intercompany debt






99,955



79,024



(178,979
)


Liability for post-retirement benefits






39,903











39,903Liability for pension benefits


7,128



26,025



677







33,830Deferred income taxes


27,569



15







(24,437
)


3,147Other noncurrent liabilities


5,073



2,680











7,753Total liabilities


226,062



223,752



163,105



(224,465
)


388,454Shareholders equity


718,400



651,981



139,394



(791,375
)


718,400Total liabilities and shareholders equity

$
944,462


$
875,733


$
302,499


$
(1,015,840
)

$
1,106,854  78




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
  Condensed
    Consolidating Balance Sheet
 As of December 31, 2009
  RTIInternational


Guarantor


Non-GuarantorMetals, Inc.


Subsidiaries


Subsidiaries


Eliminations


ConsolidatedASSETSCurrent assets:Cash and cash equivalents

$



$
45,525


$
10,691


$



$
56,216Short-term investments






65,042











65,042Receivables






32,145



45,646



(16,867
)


60,924Inventories, net






154,192



112,695







266,887Deferred income taxes


20,080



1,207







(50
)


21,237Other current assets


15,590



1,291



30,241



(25,712
)


21,410Total current assets


35,670



299,402



199,273



(42,629
)


491,716Property, plant, and equipment, net


1,443



181,443



69,415







252,301Goodwill






18,097



22,971







41,068Other intangible assets, net










14,299







14,299Deferred income taxes


16,613



22,989



17,942



(3,730
)


53,814Other noncurrent assets


1,240



36



262



(1
)


1,537Intercompany investments


674,664



153,743



180



(828,587
)


Total assets

$
729,630


$
675,710


$
324,342


$
(874,947
)

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

$
361


$
27,399


$
28,300


$
(16,867
)

$
39,193Accrued wages and other employee costs


754



5,584



3,458







9,796Unearned revenue






120



21,712







21,832Other accrued liabilities


31,409



14,296



13,191



(25,762
)


33,134Total current liabilities


32,524



47,399



66,661



(42,629
)


103,955Long-term debt






60



21







81Intercompany debt


6,471







113,141



(119,612
)


Liability for post-retirement benefits






34,530











34,530Liability for pension benefits


5,296



22,129



677







28,102Deferred income taxes










3,974



(3,730
)


244Other noncurrent liabilities


6,133



2,485







(1
)


8,617Total liabilities


50,424



106,603



184,474



(165,972
)


175,529Shareholders equity


679,206



569,107



139,868



(708,975
)


679,206Total liabilities and shareholders equity

$
729,630


$
675,710


$
324,342


$
(874,947
)

$
854,735  79




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
  Condensed
    Consolidating Statement of Cash Flows
 Year Ended December 31, 2010
  RTIInternational


Guarantor


Non-GuarantorMetals, Inc.


Subsidiaries


Subsidiaries


Eliminations


ConsolidatedCash provided by operating activities

$
26,707


$
28,776


$
19,725


$



$
75,208Investing activities:Capital expenditures






(24,365
)


(4,267
)






(28,632
)Investments in subsidiaries


(205,830
)


(2,900
)






208,730



Proceeds from disposal of property, plant, and equipment










4,011







4,011Short-term investments, net






44,766











44,766Cash provided by (used in) investing activities


(205,830
)


17,501



(256
)


208,730



20,145Financing activities:Proceeds from exercise of employee stock options


1,095















1,095Excess tax benefits from stock-based compensation activity


380















380Financing fees


(7,249
)














(7,249
)Parent company investments






75,375



133,355



(208,730
)


Borrowings on long-term debt


230,000















230,000Repayments on long-term debt






(20
)


(16
)






(36
)Intercompany debt


(44,736
)


183,472



(138,736
)






Purchase of common stock held in treasury


(367
)














(367
)Cash provided by (used in) financing activities


179,123



258,827



(5,397
)


(208,730
)


223,823Effect of exchange rate changes on cash and cash equivalents










1,559







1,559Increase (decrease) in cash and cash equivalents






305,104



15,631







320,735Cash and cash equivalents at beginning of period






45,525



10,691







56,216Cash and cash equivalents at end of period

$



$
350,629


$
26,322


$



$
376,951  80




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
  Condensed
    Consolidating Statement of Cash Flows
    Year Ended December 31, 2009
  RTIInternational


Guarantor


Non-GuarantorMetals, Inc.


Subsidiaries


Subsidiaries


Eliminations


ConsolidatedCash provided by (used in) operating activities

$
(4,652
)

$
32,221


$
5,430


$



$
32,999Investing activities:Short-term investments, net






(65,000
)










(65,000
)Investments in subsidiaries


115,957



(12,907
)






(103,050
)


Capital expenditures


(33
)


(60,468
)


(21,784
)






(82,285
)Proceeds from disposal of property, plant, and equipment










22







22Cash provided by (used in) investing activities


115,924



(138,375
)


(21,762
)


(103,050
)


(147,263
)Financing activities:Borrowings on long-term debt










1,181







1,181Repayments on long-term debt


(225,000
)


(24
)


(18,431
)






(243,455
)Purchase of common stock held in treasury


(105
)














(105
)Proceeds from equity offering, net


127,423















127,423Intercompany debt


(13,449
)


14,720



(1,271
)






Parent company investments






(135,331
)


32,281



103,050



Proceeds from exercise of employee stock options


120















120Excess tax benefits from stock-based compensation activity


39















39Financing fees


(300
)














(300
)Cash provided by (used in) financing activities


(111,272
)


(120,635
)


13,760



103,050



(115,097
)Effect of exchange rate changes on cash and cash equivalents










1,128







1,128Increase (decrease) in cash and cash equivalents






(226,789
)


(1,444
)






(228,233
)Cash and cash equivalents at beginning of period






272,314



12,135







284,449Cash and cash equivalents at end of period

$



$
45,525


$
10,691


$



$
56,216  81




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
  Condensed
    Consolidating Statement of Cash Flows
    Year Ended December 31, 2008
  RTIInternational


Guarantor


Non-GuarantorMetals, Inc.


Subsidiaries


Subsidiaries


Eliminations


ConsolidatedCash provided by operating activities

$
1,140


$
76,629


$
5,190


$



$
82,959Investing activities:Capital expenditures


(1,737
)


(56,484
)


(67,369
)






(125,590
)Investments in subsidiaries


(430,193
)


(49,350
)






479,543



Cash provided by (used in) investing activities


(431,930
)


(105,834
)


(67,369
)


479,543



(125,590
)Financing activities:Proceeds from exercise of employee stock options


137















137Excess tax benefits from stock-based compensation activity


215















215Financing fees


(1,313
)














(1,313
)Parent company investments






423,470



56,073



(479,543
)


Borrowings on long-term debt


225,000



80



1,970







227,050Repayments on long-term debt






(2
)


(1,079
)






(1,081
)Intercompany debt


114,193



(124,905
)


10,712







Purchase of common stock held in treasury


(9,090
)














(9,090
)Proceeds from government grants






2,842











2,842Cash provided by (used in) financing activities


329,142



301,485



67,676



(479,543
)


218,760Effect of exchange rate changes on cash and cash equivalents










815







815Increase (decrease) in cash and cash equivalents


(101,648
)


272,280



6,312







176,944Cash and cash equivalents at beginning of period


101,648



34



5,823







107,505Cash and cash equivalents at end of period

$



$
272,314


$
12,135


$



$
284,449  82




---



##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial Statements
  (In
    thousands, except share and per share amounts, unless otherwise
    indicated)
  Note 16
    SELECTED
    QUARTERLY FINANCIAL INFORMATION (UNAUDITED):    1st


2nd


3rd


4th2010

Quarter


Quarter


Quarter


QuarterNet Sales

$
107,885


$
106,651


$
102,593


$
114,664Gross profit


27,523



16,949



14,175



17,238Operating income (loss)


11,680



2,093



(2,228
)


2,516Net income (loss)


11,398



10,239



(16,775
)


(1,445
)Earnings per share:Basic

$
0.38


$
0.34


$
(0.56
)

$
(0.05
)Diluted

$
0.38


$
0.34


$
(0.56
)

$
(0.05
)   1st


2nd


3rd


4th2009

Quarter


Quarter


Quarter


QuarterNet Sales

$
106,054


$
104,354


$
100,247


$
97,323Gross profit


16,292



13,495



17,821



8,203Operating income (loss)


(779
)


(1,603
)


1,971



(86,865
)Net income (loss)


(1,459
)


125



(8,652
)


(57,253
)Earnings per share:Basic

$
(0.06
)

$
0.01


$
(0.35
)

$
(1.91
)Diluted

$
(0.06
)

$
0.01


$
(0.35
)

$
(1.91
)  83




---



##### Table of Contents



Item 9.
    Changes
    in and Disagreements with Accountants on Accounting and
    Financial Disclosure.    Item 9A.
    Controls
    and Procedures.  Disclosure
    controls and procedures
    Managements
    report on internal control over financial reporting
  Rule 13a-15(f).
  Internal Control  Integrated Framework
    Changes
    in internal control over financial reporting
    Item 9B.
    Other
    Information   84




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##### Table of Contents



PART III  Item 10.
    Directors,
    Executive Officers and Corporate Governance.            Item 11.
    Executive
    Compensation.    Item 12.
    Security
    Ownership of Certain Beneficial Owners and Management and
    Related Stockholder Matters.   85




---



##### Table of Contents



Equity
    Compensation Plan Information
  (c) Number ofSecurities RemainingAvailable for Future(a) Number of





Issuance Under EquitySecurities to be





Compensation PlansIssued Upon Exercise


(b) Weighted-Average


(Excluding Securitiesof Outstanding


Exercise Price of


Reflected in ColumnPlan Category

Options


Outstanding Options


(a))Equity compensation plans approved by security holders (see Note
    (i) and Note (iii))


497,686


$
31.66



1,479,630Equity compensation plans not approved by security holders (see
    Note (ii))










497,686


$
31.66



1,479,630   Note (i): 10-year
  Note (ii):
  Note (iii):
  Item 13.
    Certain
    Relationships and Related Transactions, and Director
    Independence.    Item 14.
    Principal
    Accountant Fees and Services.   86




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##### Table of Contents



PART IV  Item 15.
    Exhibits,
    Financial Statement Schedules.          Exhibits
    ExhibitNo.

Description2
.1

Amended and Restated Reorganization Agreement, incorporated by
    reference to Exhibit 2.1 to the Companys Registration
    Statement on
    Form S-1
    No. 33-30667
    Amendment No. 1.3
.1

Amended and Restated Articles of Incorporation of the Company,
    effective April 29, 1999, incorporated by reference to
    Exhibit 3.1 to the Companys Quarterly Report on
    Form 10-Q
    for the quarter ended March 31, 1999.3
.2

Amended Code of Regulations of the Company, incorporated by
    reference to Exhibit 3.3 to the Companys Registration
    Statement on
    Form S-4
    No. 333-61935.4
.1

First Amended and Restated Credit Agreement dated
    September 8, 2008, incorporated by reference to
    Exhibit 4.1 to the Companys Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2009.4
.2

First Amendment to the First Amended and Restated Credit
    Agreement, dated September 18, 2009, incorporated by
    reference to the Companys Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2009.4
.3

Second Amendment to the First Amended and Restated Credit
    Agreement, dated January 19, 2010, incorporated by
    reference to the Companys Annual Report on
    Form 10-K
    for the year ended December 31, 2009.4
.4

Third Amendment to First Amended and Restated Credit Agreement,
    dated December 7, 2010, incorporated by reference to
    Exhibit 10.1 to the Companys Current Report on
    Form 8-K
    for the event dated December 8, 2010.4
.5

Assumption Agreement, dated March 1, 2010 by and between
    PNC Bank, NA and Wells Fargo Bank, NA, incorporated by reference
    to Exhibit 10.1 to the Companys Current Report on
    Form 8-K
    for the event dated March 5, 2010.4
.6

Offer of loan by and among RTI-Claro, Inc., as borrower and
    Investissement Quebec, dated August 3, 2006, incorporated
    by reference to the Companys Quarterly Report on
    Form 10-Q
    for quarterly period ended September 30, 2006.4
.7

Form of Senior Debt Indenture by and among RTI International
    Metals, Inc. and The Bank of New York Mellon Trust Company,
    N.A., Trustee, incorporated by reference to Exhibit 4.8 to
    the Companys
    Form S-3ASR
    No. 333-171034,
    filed December 8, 2010.4
.8

Form of Subordinated Indenture by and among RTI International
    Metals, Inc. and The Bank of New York Mellon Trust Company,
    N.A., Trustee, incorporated by reference to Exhibit 4.9 to
    the Companys
    Form S-3ASR
    No. 333-171034,
    filed December 8, 2010.4
.9

Indenture, dated December 14, 2010 by and between RTI
    International Metals, Inc. and The Bank of New York Mellon
    Trust Company, N.A., incorporated by reference to
    Exhibit 4.1 to the Companys Current Report on
    Form 8-K
    for the event dated December 14, 2010.4
.10

First Supplemental Indenture, dated December 14, 2010 by
    and between RTI International Metals, Inc., the Subsidiary
    Guarantors party thereto and the Bank of New York Mellon
    Trust Company, N.A., incorporated by reference to
    Exhibit 4.2 to the Companys Current Report on
    Form 8-K
    for the event dated December 14, 2010.4
.11

Form of 3.000% Convertible Senior Notes due 2015,
    incorporated by reference to Exhibit 4.3 to the
    Companys Current Report on
    Form 8-K
    for the event dated December 14, 2010. 87




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##### Table of Contents



ExhibitNo.

Description10
.1*

RTI International Metals, Inc. Supplemental Pension Program
    effective August 1, 1987, as amended and restated
    October 26, 2007, incorporated by reference to
    Exhibit 10.1 to the Companys Annual Report on
    Form 10-K
    for the year ended December 31, 2007.10
.2*

RTI International Metals, Inc. Excess Benefits Plan effective
    July 18, 1991, and restated October 26, 2007,
    incorporated by reference to Exhibit 10.2 to the
    Companys Annual Report on
    Form 10-K
    for the year ended December 31, 2007.10
.3*

RTI International Metals, Inc., 1995 Stock Plan incorporated by
    reference to Exhibit 10.11 to the Companys Annual
    Report on
    Form 10-K
    for the year ended December 31, 1995.10
.4*

RTI International Metals, Inc. 2002 Non-Employee Director Stock
    Option Plan, incorporated by reference to Exhibit 4.3 to
    the Companys Registration Statement on
    Form S-8
    dated February 19, 2002.10
.5*

RTI International Metals, Inc. 2004 Stock Plan effective
    January 28, 2005, as amended January 26, 2007,
    incorporated by reference to Exhibit 10.12 to the
    Companys Annual Report on
    Form 10-K
    for the year ended December 31, 2006.10
.6*

Form of Non-Qualified Stock Option Grant under the RTI
    International Metals, Inc. 2004 Stock Plan, incorporated by
    reference to Exhibit 10.13 to the Companys Annual
    Report on
    Form 10-K
    filed on April 14, 2005.10
.7*

Form of Restricted Stock Grant under the RTI International
    Metals, Inc. 2004 Stock Plan, incorporated by reference to
    Exhibit 10.14 to the Companys Annual Report on
    Form-10K for the year ended December 31, 2004.10
.8*

Form of Performance Share Award under the RTI International
    Metals, Inc. 2004 Stock Plan, incorporated by reference to
    Exhibit 10.1 to the Companys Current Report on
    Form 8-K
    for the event dated January 25, 2008.10
.9*

RTI International Metals, Inc., Employee Stock Purchase Plan,
    incorporated by reference to Annex A to the Companys
    Notice of Annual Meeting of Shareholders and Proxy Statement,
    Form 14A, dated February 23, 2009.10
.10*

RTI International Metals, Inc. Board of Directors Compensation
    Program, as amended July 27, 2007, incorporated by
    reference to Exhibit 10.26 to the Companys Annual
    Report on
    Form 10-K
    for the year ended December 31, 2007.10
.11*

Pay philosophy and guiding principles covering executive
    compensation, filed herewith.10
.12*

Form of indemnification agreement, incorporated by reference to
    Exhibit 10.1 to the Companys Current Report on
    Form 8-K
    for the event dated May 20, 2010.10
.13*

Amended and Restated Executive Non-Change in Control Severance
    Policy, as amended December 31, 2008, incorporated by
    reference to Exhibit 10.7 to the Companys Current
    Report on
    Form 8-K
    for the event dated December 31, 2008.10
.14*

Amended and Restated Executive Change in Control Severance
    Policy, as amended December 31, 2008, incorporated by
    reference to Exhibit 10.8 to the Companys Current
    Report on
    Form 8-K
    for the event dated December 31, 2008.10
.15*

Amended and restated employment agreement, dated
    December 31, 2008, between the Company and Dawne S.
    Hickton, incorporated by reference to Exhibit 10.1 to the
    Companys Current Report on
    Form 8-K
    for the event dated December 31, 2008.10
.16*

Employment Agreement, dated May 17, 2010, between the
    Company and James L. McCarley, incorporated by reference to
    Exhibit 10.1 to the Companys Current Report on
    Form 8-K
    for the event dated May 20, 2010.10
.17*

Amended and restated employment agreement, dated
    December 31, 2008, between the Company and Stephen R.
    Giangiordano, incorporated by reference to Exhibit 10.3 to
    the Companys Current Report on
    Form 8-K
    for the event dated December 31, 2008.10
.18*

Amended and restated employment agreement, dated
    December 31, 2008, between the Company and William T. Hull,
    incorporated by reference to Exhibit 10.4 to the
    Companys Current Report on
    Form 8-K
    for the event dated December 31, 2008. 88




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##### Table of Contents



ExhibitNo.

Description10
.19*

Amended and restated employment agreement, dated
    December 31, 2008, between the Company and William F.
    Strome, incorporated by reference to Exhibit 10.5 to the
    Companys Current Report on
    Form 8-K
    for the event dated December 31, 2008.10
.20*

Amended and restated employment agreement, dated
    December 31, 2008, between the Company and Chad Whalen,
    incorporated by reference to Exhibit 10.6 to the
    Companys Current Report on
    Form 8-K
    for the event dated December 31, 2008.10
.21

Master Supply Agreement, dated March 25, 2008, between RTI
    Hamilton, Inc., and Tronox LLC, incorporated by reference to
    Exhibit 10.1 to the Companys Current Report on
    Form 8-K
    for the event dated March 25, 2008.10
.22

Titanium Sponge Supply Agreement, dated January 1, 2007,
    between the Company and Sumitomo Titanium Corporation and its
    affiliates, incorporated by reference to Exhibit 10.9 to
    the Companys Quarterly Report on
    Form 10-Q
    for the quarterly period ended March 31, 2007.10
.23

Amendment to Long-Term Supply Agreement, dated May 30,
    2007, between the Company and Lockheed Martin Corporation and
    its affiliates, incorporated by reference to Exhibit 10.1
    to the Companys Quarterly Report on
    Form 10-Q
    for the quarterly period ended June 30, 2007.10
.24

Amended and Restated Procurement Frame Contract between EADS
    Deutschland GmbH and the Company dated July 20, 2010
    incorporated by reference to Exhibit 10.1 to the
    Companys Current Report on
    Form 8-K
    for the event dated July 22, 2010.21
.1

Subsidiaries of the Company, filed herewith.23
.1

Consent of independent registered public accounting firm, filed
    herewith.24
.1

Powers of Attorney, filed herewith.31
.1

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

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

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

Certification of Chief Financial Officer Pursuant to
    18 U.S.C. Section 1350, as Adopted Pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2002, filed
    herewith.      89




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##### Table of Contents



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

DateDANIEL I. BOOKER, Director;RONALD L. GALLATIN, Director;CHARLES C. GEDEON, Director;ROBERT M. HERNANDEZ, Director;EDITH E. HOLIDAY, Director;BRYAN T. MOSS, Director;JAMES A. WILLIAMS, Directorby:/s/  Dawne
    S. HicktonDawne
    S. Hickton
    As
    Attorney-in-Fact

March 1, 2011/s/  Dawne
    S. HicktonDawne
    S. Hickton
    Vice Chair, President, Chief Executive Officer and Director

March 1, 2011/s/  William
    T. HullWilliam
    T. Hull
    Senior Vice President and Chief Financial Officer (principal accounting officer)

March 1, 2011  90




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##### Table of Contents



RTI
    INTERNATIONAL METALS, INC. AND SUBSIDIARIES
 Schedule II 
    Valuation and Qualifying Accounts



(In
    thousands)  (Charged)

(Charged)Balance at

Credited to

Credited to

BalanceBeginning

Costs and

Other

at EndDescription

of Year

Expenses

Accounts

of YearYear ended December 31, 2010:Allowance for doubtful accounts

$
(646
)

$
168


$



$
(478
)Valuation allowance for deferred income taxes


(4,066
)


(266
)






(4,332
)Year ended December 31, 2009:Allowance for doubtful accounts

$
(2,260
)

$
1,614


$



$
(646
)Valuation allowance for deferred income taxes


(1,032
)


(4,066
)


1,032



(4,066
)Year ended December 31, 2008:Allowance for doubtful accounts

$
(613
)

$
(1,647
)

$



$
(2,260
)Valuation allowance for deferred income taxes










(1,032
)


(1,032
)  S-1