Haynes International, Inc. is one of the world’s largest producers of
high-performance nickel- and cobalt-based alloys in flat product form such as
sheet, coil and plate forms. The Company is focused on developing, manufacturing,
marketing and distributing technologically advanced, high-performance alloys,
which are sold primarily in the aerospace, chemical processing and industrial
gas turbine industries. The Company’s products consist of high-temperature
resistant alloys, or HTA products, and corrosion-resistant alloys, or CRA products.
HTA products are used by manufacturers of equipment that is subjected to extremely
high temperatures, such as jet engines for the aerospace market, gas turbine
engines used for power generation and waste incineration, and industrial heating
equipment. CRA products are used in applications that require resistance to
very corrosive media found in chemical processing, power plant emissions control
and hazardous waste treatment. Management believes Haynes is one of the principal
producers of high-performance alloy flat products in sheet, coil and plate forms,
and sales of these forms, in the aggregate, represented approximately 62% of
net product revenues. The Company also produces its products as seamless and
welded tubulars, and in slab, bar, billet and wire forms.
The Company has manufacturing facilities in Kokomo, Indiana; Arcadia, Louisiana;
and Mountain Home, North Carolina. The Kokomo facility specializes in flat products,
the Arcadia facility specializes in tubular products, and the Mountain Home
facility specializes in wire products. The Company’s products are sold
primarily through its direct sales organization, which includes 13 service and/or
sales centers in the United States, Europe and Asia.
The Company’s goal is to grow its business by increasing revenues, profitability
and cash flow while continuing to be its customers’ provider of choice
for high-performance alloys. The Company pursues this goal by analyzing capital
allocation alternatives while simultaneously taking advantage of its expert
technical abilities in delivering innovative products and applications combined
with its niche manufacturing and value-added service capabilities to penetrate
end markets.
·
Increase revenues by inventing new alloys, developing new applications for
existing alloys and expanding into new markets. The Company believes that it
is the industry leader in developing new alloys designed to meet its customers’
specialized and demanding requirements. The Company continues to work closely
with customers and end users of its products to identify, develop, manufacture
and test new high-performance alloys. Since fiscal 2003, the Company’s
technical programs have yielded eight new proprietary alloys, an accomplishment
that the Company believes distinguishes it from its competitors. The Company
expects continued emphasis on product innovation to yield similar future results.
Developing new applications for existing alloys is also a key strength and
strategy of the Company. The Company leverages its technical expertise to find
unique applications for its products especially proprietary and specialty alloys
that can yield higher margins.
Developing additional markets is a key strategy of the Company. Through development
of new alloys and new applications for existing alloys, the Company is seeking
to develop additional markets which will generate new revenue streams beyond
the core markets of aerospace, chemical processing and industrial gas turbine
industries. The Company believes that synthetic natural gas, renewable energy
(such as solar), fuel cells, clean-coal, waste-to-energy, oil and gas, flue-gas
desulfurization in China, automotive, consumer electronics, heat treatment,
medical and nuclear industries all present opportunities for its products.
Increase revenues by providing value-added processing services and leveraging
our global distribution network. The Company believes that its network of service
and sales centers throughout North America, Europe and Asia distinguishes it
from its competitors, many of whom operate only mills. The Company’s service
and sales centers enable it to develop close customer relationships through
direct interaction with customers and to respond to customer orders quickly,
while providing value-added cutting services such as laser, plasma and water
jet cutting. These services allow the Company’s customers to minimize
their processing costs and outsource non-core activities. In addition, the Company’s
rapid response time and enhanced processing services for products shipped from
its service and sales centers offers the opportunity for the Company to service
its customers more timely.
Capitalize on strategic equipment investment and optimize our processes with
lean manufacturing improvements. The Company expects to continue to improve
operations through ongoing capital investment in manufacturing facilities and
equipment including information technology and utilizing six sigma and lean
manufacturing process improvements. Ongoing investment in equipment has significantly
improved the Company’s operations by increasing capacity, reducing unplanned
downtime and manufacturing costs, and improving product quality and working
capital management. Management believes that the Company’s capital investments
will enable it to continue to satisfy long-term customer demand for value-added
products that meet increasingly precise specifications. ·
Expand product capability through strategic acquisitions and alliances. The
Company will continue to examine opportunities that enable it to offer customers
an enhanced and more competitive product line to complement its core flat products.
These opportunities may include product line enhancement and market expansion
opportunities. The Company will also continue to evaluate strategic relationships
with third parties in the industry in order to enhance its competitive position
and relationships with customers.
Continue to expand the maintenance, repair and overhaul business. The Company
believes that its maintenance, repair and overhaul, or MRO, business serves
a growing market and represents both an expanding and recurring revenue stream.
Products used in the Company’s end markets require periodic replacement
due to the extreme environments in which they are used, which drives demand
for recurring MRO work. The Company intends to continue to leverage the capabilities
of its service and sales centers to respond quickly to its customers’
time-sensitive MRO needs to develop new and retain existing business opportunities.
%
3.51%