A. M. Castle & Co. (the "Company") is a global distributor of specialty metal and plastic products, value-added services and supply chain solutions, principally serving the producer durable equipment sector of the economy. Its customer base includes many Fortune 500 companies as well as thousands of medium and smaller-sized firms spread across a variety of industries. Within its metals business, it specializes in the distribution of alloy and stainless steels; nickel alloys; aluminum and carbon. Through its subsidiary, Total Plastics, Inc., the Company also distributes a broad range of value-added industrial plastics. Together, Castle operates over 65 locations throughout North America, Europe and Asia.
Since the end of 2003 sales have nearly tripled to $1.4 billion while EBITDA has grown to $116 million and net income has grown three-fold. Correspondingly, the stock price has more than tripled during that same period.
In January 2008, the Company acquired the outstanding capital stock of Metals UK Group, a distributor and processor of specialty metals primarily serving the oil and gas, aerospace, petrochemical and power generation markets worldwide for approximately $32 million, plus the potential for contingent payments of up to $12.0 million based on the achievement of performance targets predominantly over the next one year. Metals UK Group has four processing facilities; two in Blackburn, England, including its headquarters, one in Hoddesdon North East of London and one in Bilbao, Spain.
It also announced that it had obtained a business license for the opening of a new service center in Shanghai, China, A. M. Castle Metal Materials (Shanghai) Co., Ltd (dba Transtar Metals), which is expected to be fully operational in the fiscal second quarter of 2008.
Castle is well positioned in high-growth end markets such as aerospace and oil and gas, which are expected to remain strong over the next several years. The Company has approximately 40% of its revenues in the aerospace and defense industry. With solid operating profits and a strong balance sheet, the Company has stepped-up its rate of capital investment with a primary focus on its information systems, and equipment to advance productivity. Castle has a clear vision of its future which reflects the needs and direction of the principal markets it serves. With a debt-to-capital ratio well below its long-term target rate, the Company intends to continue to aggressively execute and expand its leadership position.
