LATROBE SPECIALTY STEEL

AMM Aerospace Metals Conference

Pittsburgh, PA

Dan HennessyV.P. - Manufacturing

April 11, 2007

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Outline

LSS History

LSS Capital Investment

Market Conditions

Future Aircraft requirements

LSS Response

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Latrobe Specialty Steel

Latrobe Electric Steel Company founded in 1913

Became part of The Timken Company in 1975

Sold by Timken on December 8, 2006 to a group led by Watermill Ventures and Hicks Holdings

Reliably supply high performance materials and related services

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Latrobe Specialty Steel

From inception began developing high alloyed steels for specialized applications

Began producing remelted aerospace steels – 1958 VIM and VAR One of the first producers

Today Largest global producer of remelted steels Largest domestic producer of high speed steel Largest master distributor of tool steels

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Capital Expenditures Invested $100+M from 1990 - 2000

Forging facility, remelt capacity, machining plant

2001 – 2006 invested additional $35M Additional remelting capacity,

added VIM capacity, grinding capacity, sawing capacity, upgraded rolling mill

Result: Modern well equipped facilities for our market segments

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Aerospace Assets

Operating Today: 13 vacuum arc remelt furnaces Three of the largest in the world 30 ton VIM Numerous approvals and process agreements Largest number of grades in the industry Maintaining a dedicated technical department for

CI, customer service and product development

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Current Market Condition Boeing and Airbus forecast is stable

Will produce 900+ planes per year Growth of defense related market These combine to drive abnormally high demand However the aerospace market will remain cyclical

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Boeing Airbus Bombardier Embraer

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Steel Industry’s Reaction

Capacity added at many producers

Last year LSS: added two vacuum

remelt furnaces Downstream

processing equipment Manpower

Result: Lead time reduction however lead time remains long

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Future Outlook

Continued significant requirements for aerospace steels on future commercial aircraft due to:

Combination of strength, ductility and fracture toughness unmatched in materials

Ex. A380 landing gear – one of two globally approved producers

Future aircraft will continue this trend Producers will require extensive technological

expertise and service

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LSS Plans

Add additional capacity to further reduce lead time Will add another large remelt furnace

Start-up first quarter, 2008 Considering other investments

Expect lead times to become reasonable prior to any new entrants becoming certified

Continue to extend our position in marketplace Technological leadership in premium aerospace steels Service leadership in our markets

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Questions?