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EXHIBIT 99.2
RMI TITANIUM COMPANY
BARGAINING UNIT EMPLOYEE SAVINGS
AND INVESTMENT PLAN
ANNUAL REPORT
FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
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Report of Independent Accountants
To the Participants and Administrator of the
RMI Titanium Company Bargaining Unit Employee Savings and Investment Plan
In our opinion, the accompanying statements of net assets available for benefits
and the related statements of changes in net assets available for benefits
present fairly, in all material respects, the net assets available for benefits
of the RMI Titanium Company Bargaining Unit Employee Savings and Investment Plan
(the "Plan") at December 31, 1999 and December 31, 1998, and the changes in net
assets available for benefits for the years then ended in conformity with
accounting principles generally accepted in the United States. These financial
statements are the responsibility of the Plan's management; our responsibility
is to express an opinion on these financial statements based on our audits. We
conducted our audits of these statements in accordance with auditing standards
generally accepted in the United States, which require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for the opinion expressed
above.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of Assets Held
for Investment Purposes is presented for the purpose of additional analysis and
is not a required part of the basic financial statements but is supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. This supplemental schedule is the responsibility of the Plan's management.
The supplemental schedule has been subjected to the auditing procedures applied
in the audits of the basic financial statements and, in our opinion, is fairly
stated in all material respects in relation to the basic financial statements
taken as a whole.
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Pittsburgh, Pennsylvania
June 29, 2000
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RMI TITANIUM COMPANY
BARGAINING UNIT EMPLOYEE SAVINGS AND INVESTMENT PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1999 AND 1998
<TABLE>
<CAPTION>
1999 1998
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<S> <C> <C>
Investments at fair value $20,271,662 $18,018,066
Contributions receivable 136,231 --
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Net assets available for benefits $20,407,893 $18,018,066
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</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
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RMI BARGAINING UNIT
EMPLOYEE SAVINGS AND INVESTMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
<TABLE>
<CAPTION>
1999 1998
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<S> <C> <C>
Employees' contributions $ 814,813 $ 1,865,824
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Investment income:
Interest and dividend income 1,469,685 1,060,055
Net appreciation in fair value
of investments 838,500 1,821,305
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2,308,185 2,881,360
Transfers (1,276) 456
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Total additions 3,121,722 4,747,640
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Participant's benefits paid (731,895) (628,826)
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Total deductions (731,895) (628,826)
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Increase in net assets 2,389,827 4,118,814
Net assets available for benefits
Beginning of year 18,018,066 13,899,252
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End of year $20,407,893 $18,018,066
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</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
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RMI TITANIUM COMPANY
BARGAINING UNIT EMPLOYEE SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998
NOTE 1 - SUMMARY OF ACCOUNTING POLICIES:
ACCOUNTING METHOD
The financial statements of the RMI Titanium Company Bargaining Unit Employee
Savings and Investment Plan (the Plan) use the accrual method of accounting.
USE OF ESTIMATES
Generally accepted accounting principles require management to make certain
estimates and assumptions relating primarily to the fair market value of certain
Plan assets. Actual results could differ from those estimates. For additional
information on the fair market value of Plan assets, see "Investments" below.
INVESTMENTS
Available investment options at December 31, 1999 are as follows:
RTI INTERNATIONAL METALS, INC. COMMON STOCK - Funds are invested in shares of
RTI Metals, Inc. common stock.
Fidelity managed mutual fund accounts:
FIDELITY MAGELLAN FUND - Funds are invested in shares of a registered investment
company that invests primarily in equity securities.
FIDELITY GROWTH AND INCOME FUND - Funds are invested in shares of a registered
investment company that invests primarily in equity securities.
FIDELITY LOW-PRICED STOCK FUND - Funds are invested in shares of a registered
investment company that invests primarily in shares of small-sized companies.
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FIDELITY WORLDWIDE FUND - Funds are invested in shares of a registered
investment company that invests primarily in common stocks issued by companies
of all sizes anywhere in the world, including the U.S.
SPARTAN U.S. EQUITY INDEX FUND - Funds are invested in shares of a registered
investment company that attempts to duplicate the composition and total return
of the S&P 500.
Fidelity stable value funds:
FIDELITY MANAGED INCOME PORTFOLIO - Funds are invested in short- and long-term
investment contracts issued by insurance companies and commercial banks.
Investments in Fidelity managed funds and RTI International Metals, Inc. common
stock are valued at fair market value based on published quotations. Security
transactions are recorded as of the settlement date.
FUNDING
The Plan is funded by contributions from the participating employees of the
Company. The costs of administering the Plan and the trust are borne by the
Company.
PAYMENT OF BENEFITS
Benefits are recorded when paid.
NOTE 2 - DESCRIPTION OF PLAN:
GENERAL
RMI Titanium Company (the "Company") is the Plan Sponsor. The Company is a
successor to entities that have been operating in the titanium industry since
1951.
The following description of the Plan provides only general information.
Participants should refer to the Plan agreement for a more complete description
of the Plan's provisions.
The Plan is a defined contribution plan covering full-time union represented
employees who are at least 21 years of age and have completed three months of
service. The Plan is subject to the provisions of the Employee Retirement Income
Security Act of 1974 (ERISA).
CONTRIBUTIONS
Participants may contribute from 1% to 15% of salary through payroll deduction.
Pre-tax contributions are subject to annual limitations as prescribed by law
($10,000 in 1999 and 1998).
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NOTES TO FINANCIAL STATEMENTS (continued)
Contributions are directed by the participants into any one or all of the
investment options. Participants may change their elections of investment funds
by calling the recordkeeper directly. Participants are 100% vested in their
accounts at all times.
PAYMENT OF BENEFITS
Participants or their beneficiaries are entitled to the full current value of
their account in the Plan upon:
o Retirement;
o Termination of Employment with the Company; or
o Death
Participants may also make written application to the administrator for
withdrawal of all or a portion of their account balance for certain limited
situations qualifying as financial hardships under Internal Revenue Service
guidelines in effect at the time of the withdrawal.
PARTICIPANT LOANS RECEIVABLE
Participants may borrow from their accounts a minimum of $1,000 up to a maximum
equal to 50% of the existing account balance not to exceed $50,000 in any
12-month period. Loans are treated as a transfer (from) the investment fund to
the Participant Loans Receivable fund. Loan repayment terms range from one month
to five years and are secured by the balance in the participant's account. Loans
bear interest at a rate commensurate with the current market rate when made.
Loans made in 1999 and 1998 bear interest at 8.75%. Interest rates on loans made
prior to 1998 range from 8.75% to 15.00%. Principal and interest are paid
ratably through monthly payroll deductions. Repayments are transfers to the
investment funds (from) the Participant Loan Receivable fund.
TRANSFERS
Transfers represent transfers from or (to) other plans.
ADMINISTRATION
The Plan is administered by the Company's Retirement Board (the
"Administrator"). The Board establishes rules and procedures and interprets the
provisions of the Plan.
TERMINATION PROVISION
The Company anticipates the Plan will continue without interruption, but
reserves the right to discontinue the Plan at any time subject to the provisions
of the collective bargaining
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NOTES TO FINANCIAL STATEMENTS (continued)
agreement. In the event that such discontinuance results in the termination of
the Plan, the Plan provides that each participant shall be fully vested in his
or her individual account which includes earnings on the participant's
contributions. The individual accounts of the participants shall continue to be
administered by the Administrator, or be distributed in a lump sum to the
participants, as deemed appropriate by the Administrator.
NOTE 3 - INCOME TAXES:
The Internal Revenue Service (IRS) has determined and informed the Company by a
letter dated April 30, 1996, that the Plan and related trust are designed in
accordance with applicable sections of the Internal Revenue Code (IRC). The Plan
has been amended and restated since receiving the determination letter; however,
the Administrator believes that the Plan is currently being operated in
compliance with the applicable requirements of the IRC. Therefore, no provision
for income taxes has been included in the Plan financial statements.
NOTE 4 - RECORDKEEPING
Individual participant account balances, allocations and investment options are
maintained by Fidelity Investments Institutional Operations Company, Inc., based
on enrollment and payroll information supplied by the Company.
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SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
FORM 5500
RMI TITANIUM COMPANY
BARGAINING UNIT EMPLOYEES SAVINGS & INVESTMENT PLAN
<TABLE>
<CAPTION>
(e)
(b) (c) CURRENT
(a) IDENTITY DESCRIPTION OF INVESTMENT VALUE
<S> <C> <C> <C>
* Fidelity Investments Fidelity Magellan fund $ 9,966,247
* Fidelity Investments Fidelity Growth and Income Fund 1,456,248
* Fidelity Investments Fidelity Low Priced Stock Fund 335,785
* Fidelity Investments Fidelity Worldwide Fund 340,601
* Fidelity Investments Fidelity Managed Income Portfolio 4,591,306
* Fidelity Investments Spartan U.S. Equity Index Fund 1,445,509
* RTI International Metals, Inc. Common Stock 1,544,658
-- Participant Loans Receivable Interest Rates-Low 8.75%, High 15.00% 591,308
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TOTAL: $20,271,662
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</TABLE>
* DENOTES PARTY-IN-INTEREST
