Federal Reserve Bank of Cleveland Inflation Monetary Policy and the Public May 29-30, 2014

Company Overview Titanium mill product manufacturer: 1951 Advanced to titanium fabrication: 1998 24 locations in the U.S., Canada, U.K., France, China and Japan Approximately $245 million in capital investment over past 5 years Completed 4 recent acquisitions Approximately 2,500 employees Blue chip customer base Airbus, Boeing, Bombardier, Lockheed Martin, United Technologies, BP, Chevron, Shell and several large medical device OEM’s 2013 Sales: $783.3 million Commercial Aerospace - 55% , Defense - 22%, Energy, Medical & Other - 23% December 31, 2013 backlog: $516 million

2013 Revenues: $346.6 million (44%) Titanium Segment Overview Titanium Segment Titanium mill products, including bloom, billet, sheet, and plate Multiple melt platforms provide for wide range of titanium alloyed products 2013 Revenues: $346.6 million (44%)

2013 Revenues: $436.7 million (56%) Engineered Products & Service Segment Overview Engineered Products & Services Segment Multiple machining, extrusion and superplastic / hot forming businesses in the U.S., Canada, and Europe Engineer, design, extrude, 3-D print, precision machine, fabricate, assemble, kit, and install 2013 Revenues: $436.7 million (56%)

Inflation and RTI: Major Cost Drivers Material Costs Material costs, primarily titanium sponge, are the largest cost incurred by RTI Currently excess capacity in the sponge market, which continues to put downward pressure on prices Long-term contracts on both supplier and customer ends are standard in the industry Contracts include price escalators/de-escalators based on inflation providing some hedge Labor Costs Labor accounts for the second largest cost to RTI Wages for private industry in the U.S. increased at 1.7% over the last 12 months ended March 31 Health care costs in the U.S. increased by 2.4% over the past 12 months National Health Expenditures are projected to increase by ~6.0% per year through 2022 RTI Health & Wellness initiative to help counter the growth in health care costs Energy Costs Energy (gas and electricity) can typically be a large input cost for metals manufacturers, but represents less than 5% of total costs for RTI RTI has natural gas wells on its facility in Niles, OH, which reduce utility costs

Inflation and RTI: Impact by End-Market Commercial Aerospace Demand for commercial aircraft is extremely high with record backlog levels Inflation could have a significant impact on airlines earnings and demand for new aircraft. Inflation’s impacts on airline costs include: Fuel prices Significant costs to airlines, accounting for 31% of operating costs in 2013 Increasing fuel costs will create incentive to upgrade fleet to more fuel efficient aircraft Labor costs Legacy carriers have reduced labor costs through bankruptcy Pilot shortage putting upward pressure on costs Infrastructure costs - little competition in terms of airport costs, FAA & flight control Defense The Budget Control Act (BCA) has put downward pressure on Defense budget. The gap between the DoD’s plan and BCA average between $60-$90M per year DoD has put pressure on OEMs to reduce prices Inflation would likely result in lower margins throughout the supply chain for those that cannot lower manufacturing costs

Inflation and RTI: Impact by End-Market (continued) Energy Higher inflation results in higher revenues for commodities like the oil and gas industry Transportation fuel costs are passed along to consumers Costs of exploration and production may also increase with less opportunity to pass through Increased cost of commodity inputs (steel and other input materials) Increase cost of labor Inflation would likely reduce profitability for suppliers to E&P companies Use of alternative materials (titanium) and engineering design by E&P companies to reduce the cost of accessing deeper, harsher climates Medical Health care costs have increased at a higher rate than Consumer Price Index Affordable Care Act medical device excise tax (2.3%) Increased cost pressure on suppliers Reduced investment and spending by OEMs and hospitals Inflation will dampen demand and profitability further of medical device manufacturers Efficient manufacturing processes (robotics, etc.) lower the costs of production