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Business Segments
 6 Months Ended
Jun. 30, 2017
Segment Reporting [Abstract]  
Business Segments
Business Segments
The Company operates in two business segments: High Performance Materials & Components (HPMC) and Flat Rolled Products (FRP). The measure of segment operating profit, which is used to analyze the performance and results of the business segments, excludes all effects of LIFO inventory accounting and any related changes in net realizable value inventory reserves which offset the Company’s aggregate net debit LIFO valuation balance, income taxes, corporate expenses, net interest expense, closed operations expenses and restructuring costs, if any. Management believes segment operating profit, as defined, provides an appropriate measure of controllable operating results at the business segment level. Following is certain financial information with respect to the Company’s business segments for the periods indicated (in millions):
 
Three months ended June 30,
 
Six months ended June 30,
 
2017
 
2016
 
2017
 
2016
Total sales:
 
 
 
 
 
 
 
High Performance Materials & Components
$
543.3

 
$
511.1

 
$
1,067.0

 
$
1,019.0

Flat Rolled Products
373.2

 
324.3

 
746.2

 
605.5

 
916.5

 
835.4

 
1,813.2

 
1,624.5

Intersegment sales:
 
 
 
 
 
 
 
High Performance Materials & Components
16.9

 
12.7

 
30.2

 
27.6

Flat Rolled Products
19.4

 
12.2

 
36.9

 
28.9

 
36.3

 
24.9

 
67.1

 
56.5

Sales to external customers:
 
 
 
 
 
 
 
High Performance Materials & Components
526.4

 
498.4

 
1,036.8

 
991.4

Flat Rolled Products
353.8

 
312.1

 
709.3

 
576.6

 
$
880.2

 
$
810.5

 
$
1,746.1

 
$
1,568.0

Operating profit (loss):
 
 
 
 
 
 
 
High Performance Materials & Components
$
68.0

 
$
38.8

 
$
118.9

 
$
67.9

Flat Rolled Products
2.9

 
(31.8
)
 
21.9

 
(141.4
)
Total operating profit (loss)
70.9

 
7.0

 
140.8

 
(73.5
)
LIFO and net realizable value reserves
(0.1
)
 
0.4

 
(0.1
)
 
0.4

Corporate expenses
(11.8
)
 
(11.8
)
 
(22.1
)
 
(22.8
)
Closed operations and other expenses
(13.2
)
 
(5.7
)
 
(16.2
)
 
(9.2
)
Restructuring and other charges
—

 
(1.0
)
 
—

 
(10.0
)
Interest expense, net
(34.5
)
 
(30.3
)
 
(68.0
)
 
(58.6
)
Income (loss) before income taxes
$
11.3

 
$
(41.4
)
 
$
34.4

 
$
(173.7
)


Closed operations and other expenses in 2017 reflect higher costs due to the additions of the Rowley, UT, Midland, PA and Bagdad, PA facilities as a result of closure actions in 2016. Closed operations and other expenses in 2017 also reflect more significant foreign currency impacts, primarily from the Company’s European Treasury Center operation.

The first six months of 2016 include $10.0 million of restructuring charges for severance obligations. During the first quarter of 2016, a $9.0 million charge was recorded for severance obligations in the FRP operations, with the reduction of approximately one-third of FRP’s salaried workforce, which was largely completed by the end of 2016. During the second quarter of 2016, an additional $1.0 million charge was recorded for severance obligations in the HPMC segment. These severance charges were excluded from segment operating results. Reserves for restructuring charges at June 30, 2017 were $13.4 million, of which $6.6 million relates to severance and employee benefit costs and $6.8 million to closure costs. The decline in these reserves compared to $33.1 million at December 31, 2016 is due to payments. These restructuring reserves are expected to be substantially paid in 2017.