Howmet Aerospace Annual Report

Letter to Shareholders from Executive Chairman and Chief Executive Officer

April 6, 2026

Dear Shareholder,

Howmet Aerospace delivered record performance in 2025. Most markets we serve continue to grow, with our top-line performance outpacing them.

Revenue for the full year of 2025 was approximately $8.3 billion, up a healthy 11 percent from 2024, driven by significant growth in commercial aerospace, defense aerospace, and gas turbine markets. Commercial aerospace, our largest end market, benefited from accelerating demand for new aircraft and engine spares and now enjoy a record backlog for new, more fuel-efficient aircraft. Adjusted EBITDA* of over $2.4 billion was up 26 percent year-over-year. Adjusted Earnings per Share* was $3.77, up 40 percent year over year.

The Company’s balance sheet is robust and continues to get stronger. Free cash flow for the year was a record $1.43 billion, with a solid free cash flow conversion of net income* at 93 percent, as we continue to deliver on our long-term target. This impressive cash generation was after record capital investments we are making to support future growth.

We reduced gross debt by $265 million in the year, and combined with debt refinancing activity, annualized interest expense will be reduced by approximately $22 million. Net debt to last-twelve-month Adjusted EBITDA* continued to improve, ending the year at a record low of 1.0x. Capital Expenditures were a record $453 million, up approximately $132 million year over year.

Approximately 70 percent of CapEx was deployed to our Engine Products business as we expand production capabilities in commercial aerospace and gas turbines. These investments are backed by customer commitments.

In 2025, we deployed approximately $1.2 billion of cash to common stock repurchases, redemption of preferred stock, debt paydown and quarterly dividends. Common Stock of $700 million was repurchased at an average price of approximately $161 per share, retiring approximately 4.4 million shares.

Howmet’s strong balance sheet and growing cash generation provide the foundation for continuing significant capital deployment, including opportunities for acquisitions. In 2026, additions were made to the Company’s Fastening Systems portfolio. In February of this year, we acquired a privately held business in Wisconsin, Brunner Manufacturing Co. Inc., for approximately $120 million. This acquisition complements product offerings and enhances growth opportunities in industrial fasteners. In addition, in April 2026, the Company acquired Consolidated Manufacturing LLC (CAM) for approximately $1.8 billion. CAM enhances the aerospace fasteners portfolio and positions the Company to expand and grow in the aerospace market. These acquisitions play to the Company’s strengths as we allocate capital decisively to businesses that are growing and show the strongest returns on capital and  cash generation.

Commercial aerospace growth remained strong throughout 2025, with revenue up 12 percent year over year. Growth was driven by the accelerating demand for aircraft and spares for more fuel-efficient aircraft.  Commercial  aerospace engine spares were up approximately 44 percent for the full year.

Defense aerospace growth continued to be robust. Defense aerospace in 2025 was up 21 percent year over year, representing broad based sector growth.

In the fourth quarter, Oil and Gas and Industrial Gas Turbine (IGT) were combined to show a single end market: Gas Turbines. The definition of Oil and Gas versus mid-to-small IGT has become blurred, with multiple end users. Growth has been very strong with revenue up 25 percent for the full year, driven by the increased demand for electricity generation, especially  from natural gas.

Spares growth was robust across Howmet’s markets. The combination of commercial and defense aerospace, and gas turbine spares was up approximately 33 percent for the full year. Spares revenue accelerated throughout 2025 and now represents approximately 21 percent of total revenue, versus approximately 17 percent in 2024.

Engine Products delivered another record year, with year over year revenue up 16 percent to $4.3 billion, Segment Adjusted EBITDA up 25 percent to $1.4 billion, and Segment Adjusted EBITDA Margin at 33.3 percent, up approximately 250 basis points. Moreover, the Engine Products segment added approximately 1,445 net new employees, which positions us well for future growth.

Fastening Systems delivered solid year-over-year revenue and Segment Adjusted EBITDA growth, while maintaining a relatively flat headcount. For the full year, revenue was up 11 percent to $1.7 billion. Segment Adjusted EBITDA was up 31 percent to $530 million and Segment Adjusted EBITDA Margin was 30.4 percent, an increase of approximately 460 basis points.

Engineered Structures performance continues to improve. For the full year, revenue was up 8 percent year over year to $1.1 billion. Segment Adjusted EBITDA was up 46 percent to $243 million, and Segment Adjusted EBITDA Margin was 21.2 percent, up approximately 560 basis points.

Forged Wheels performed well in a soft market with lower volumes. For the full year, revenue was down 1 percent year over year to $1.0 billion. Segment Adjusted EBITDA was up 3 percent to $296 million, and Segment Adjusted EBITDA Margin was up approximately 130 basis points as the team flexed costs and drove higher product mix with premium products to improve profitability.

These exceptional results would not be possible without dedicated and focused employees determined to deliver the highest performing products for the customers and markets we serve. We prioritize the safety and growth of our employees, act as a positive neighbor in the communities where we operate and steward our environmental resources responsibly while making sound business investments. We strive to be a dependable partner for our customers, our employees, and the communities where we operate. Although we continue to face tariff uncertainties and geopolitical dynamics, the markets we serve continue to be healthy, and our strategy remains unchanged.

• Focus on what we are good at to drive growth above market rate
• Prioritize major differentiated products for resource allocation
• Underpin strategy with commercial and operational discipline
• Execute a disciplined capital allocation strategy

Howmet Aerospace is well-positioned to meet the demands of the marketplace and reliably deliver the mission-critical products our customers demand.

JOHN C. PLANT
Executive Chairman and Chief Executive Officer
Howmet Aerospace Inc.

*See “Calculation of Financial Measures” at the end of this report for reconciliations of non-GAAP financial measures to the most directly comparable GAAP financial measures. Adjusted EBITDA, Adjusted Earnings per Share, and Net Income referenced in this letter each excludes special items.

References to performance by Howmet Aerospace or its segments as “record” or “all-time high” mean its best result since April 1, 2020 when Howmet Aerospace Inc. (previously named for Arconic Inc.) separated from Arconic Corporation.

Certain statements on this website by Howmet Aerospace Inc. relate to future events and expectations and as such constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include those containing such words as “anticipates“, “believes“, “could“, “envisions”, “estimates“, “expects“, “forecasts“, “goal“, “guidance“, “intends“, “may“, “outlook“, “plans“, “projects“, “seeks“, “sees“, “should“, “targets“, “will“, “would“, or other words of similar meaning. All statements that reflect Howmet Aerospace Inc.’s (“Howmet’s”) expectations, assumptions or projections about the future, other than statements of historical fact, are forward-looking statements, including, without limitation, statements, forecasts and outlook relating to: the condition of markets; future financial results or operating performance; future strategic actions; Howmet’s strategies, outlook, and business and financial prospects; and any future dividends, debt issuances, debt reduction and repurchases of its common stock; and statements regarding any planned acquisition, including the expected benefits and timing of such planned acquisition. These statements reflect beliefs and assumptions that are based on Howmet’s perception of historical trends, current conditions and expected future developments, as well as other factors Howmet believes are appropriate in the circumstances. Forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and changes in circumstances that are difficult to predict, which could cause actual results to differ materially from those indicated by these statements. Such risks and uncertainties include, but are not limited to: (a) deterioration in global economic and financial market conditions generally, or unfavorable changes in the markets served by Howmet, including due to escalating tariff and other trade policies and the resulting impacts on Howmet’s supply and distribution chains, as well as on market volatility and global trade generally; (b) the impact of potential cyber attacks and information technology or data security breaches; (c) the loss of significant customers or adverse changes in customers’ business or financial conditions; (d) manufacturing difficulties or other issues that impact product performance, quality or safety; (e) inability of suppliers to meet obligations due to supply chain disruptions or otherwise; (f) failure to attract and retain a qualified workforce and key personnel, labor disputes or other employee relations issues; (g) the inability to achieve improvement in or strengthening of financial performance, operations or competitiveness anticipated or targeted; (h) inability to meet increased demand, production targets or commitments; (i) competition from new product offerings, disruptive technologies or other developments; (j) geopolitical, economic, and regulatory risks relating to Howmet’s global operations, including geopolitical and diplomatic tensions, instabilities, conflicts and wars, as well as compliance with U.S. and foreign trade and tax laws, sanctions, embargoes and other regulations; (k) the outcome of contingencies, including legal proceedings, government or regulatory investigations, and environmental remediation; (l) failure to comply with government contracting regulations; (m) adverse changes in discount rates or investment returns on pension assets; (n) the ability to consummate and realize expected benefits of acquisitions on the anticipated time frame or at all; and (o) the other risk factors summarized in Howmet’s Form 10-K for the year ended December 31, 2025 and other reports filed with the U.S. Securities and Exchange Commission (SEC). Market projections are subject to the risks discussed above and other risks in the market. Under its share repurchase program, Howmet may repurchase shares from time to time, in amounts, at prices, and at such times as it deems appropriate, subject to market conditions, legal requirements and other considerations. Howmet is not obligated to repurchase any specific number of shares or to do so at any particular time. The declaration of any future dividends is subject to the discretion and approval of Howmet’s Board of Directors after consideration of all factors it deems relevant and subject to applicable law. Howmet may modify, suspend, or cancel its share repurchase program or any dividend policy in any manner and at any time that it may deem necessary or appropriate. Credit ratings are not a recommendation to buy or hold any Howmet securities, and they may be revised or revoked at any time at the sole discretion of the credit rating organizations. The statements contained in a presentation or document are made as of the date of this presentation, even if subsequently made available by Howmet on its website or otherwise. Howmet disclaims any intention or obligation to update publicly any forward-looking statements, whether in response to new information, future events or otherwise, except as required by applicable law.