Aerospace & oil and gas markets driving growth for USAP
13 February 2018
Recent market research shows that both the aerospace and oil & gas industries are fuelling strong order growth, which would likely result in strong margin leverage in the coming years.
GE alone is expecting to quadruple its aircraft engine deliveries over the next three years, and that should lead to significant demand growth for Universal Stainless & Alloy Products, Inc.’s (USAP’s) higher-margin vacuum induction/vacuum arc alloys. In fact, the last 12 months have been good for specialty alloy companies such as Allegheny (ATI), Carpenter (CRS), and Arconic.
In the specific case of USAP, the company saw a growth across its product line-up, with stainless steel alloys up 45% (making up two-thirds of sales), high-strength low alloy steel up 114% (to about 10%), tool steel up 14%, and high-temp steel up over 200%. Even more importantly, sales of premium alloys were up over 135%, rising to almost 15% of total sales.
Image courtesy of Fircroft