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Business Segments
 12 Months Ended
Dec. 31, 2020
Segment Reporting [Abstract]  
Business Segments Business Segments
Effective January 1, 2020, the Company began operating under two revised business segments: High Performance Materials & Components (HPMC) and Advanced Alloys & Solutions (AA&S). All segment reporting information for 2020 and prior periods below reflect these two revised business segments.
HPMC is comprised of the Specialty Materials and Forged Products businesses, as well as the ATI Europe distribution operations. The revised HPMC segment intensifies its primary focus on maximizing aero-engine materials and components growth, with approximately 80% of its revenue derived from the aerospace & defense markets and nearly half of its revenue from products for commercial jet engines. Other major HPMC end markets include medical and energy. HPMC produces a wide range of high performance materials, and components, and advanced metallic powder alloys made from nickel-based alloys and superalloys, titanium and titanium-based alloys, and a variety of other specialty materials. Capabilities range from cast/wrought and powder alloy development to final production of highly engineered finished components, including those used for next-generation jet engine forgings and 3D-printed aerospace products.
The new AA&S segment combines the Specialty Alloys & Components business, including the primary titanium operations in Richland, WA and Albany, OR, with ATI’s former Flat Rolled Products (FRP) business segment, which included the FRP business, consisting of the Specialty Rolled Products and Standard Stainless Sheet Products product lines, the 60%-owned STAL joint venture, and the Uniti and A&T Stainless 50%-owned joint ventures that are reported in AA&S segment results under the equity method of accounting. See Note 9 for further information on the Company’s joint ventures. AA&S is focused on delivering high-value flat products primarily to the energy, aerospace, and defense end-markets, which comprise approximately 50% of its revenue. AA&S was created to align melting technologies with hot-rolling capabilities to produce products with faster flow times and lower costs. Financial results of aerospace-grade titanium plate products also transferred from HPMC to AA&S effective January 1, 2020. Other important end markets for AA&S include automotive and electronics. AA&S produces nickel-based alloys, specialty alloys, and titanium and titanium-based alloys, and stainless products in a variety of forms including plate, sheet, and strip products. On December 2, 2020, the Company announced a strategic repositioning of its FRP business, which includes exiting standard stainless sheet products, streamlining the production footprint of the AA&S segment and making certain capital investments to increase its focus on higher-margin products and its aerospace & defense end markets. See Note 3 for further discussion of this strategic realignment and its associated asset impairment, restructuring and other charges recorded in the fourth quarter of 2020.
In the fourth quarter 2020, the Company changed its’ segment performance measure from segment operating profit to segment EBITDA, based on internal reporting changes. Prior period results are presented using the new performance measure. The measure of segment EBITDA 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, depreciation and amortization, corporate expenses, net interest expense, closed operations and other expenses, charges for goodwill and asset impairments, restructuring and other charges, debt extinguishment charges and non-operating gains or losses. Management believes segment EBITDA, as defined, provides an appropriate measure of controllable operating results at the business segment level.
Intersegment sales are generally recorded at full cost or market. Common services are allocated on the basis of estimated utilization.
(In millions)202020192018
Total sales:
High Performance Materials & Components$1,235.4 $2,054.2 $2,039.2 
Advanced Alloys & Solutions1,947.5 2,392.2 2,302.4 
Total sales3,182.9 4,446.4 4,341.6 
Intersegment sales:
High Performance Materials & Components70.8 75.7 76.1 
Advanced Alloys & Solutions130.0 248.2 218.9 
Total intersegment sales200.8 323.9 295.0 
Sales to external customers:
High Performance Materials & Components1,164.6 1,978.5 1,963.1 
Advanced Alloys & Solutions1,817.5 2,144.0 2,083.5 
Total sales to external customers$2,982.1 $4,122.5 $4,046.6 
Total international sales were $1,173.0 million in 2020, $1,667.9 million in 2019, and $1,698.4 million in 2018. Of these amounts, sales by operations in the United States to customers in other countries were $812.3 million in 2020, $1,262.6 million in 2019, and $1,303.8 million in 2018.
(In millions)202020192018
EBITDA:
High Performance Materials & Components$129.6 $356.2 $360.3 
Advanced Alloys & Solutions115.0 172.6 206.4 
Total segment EBITDA244.6 528.8 566.7 
LIFO and net realizable value reserves (See Note 6)— (0.1)(0.7)
Corporate expenses(40.9)(65.3)(57.3)
Closed operations and other expenses(7.4)(24.0)(19.5)
Total ATI Adjusted EBITDA196.3 439.4 489.2 
Depreciation & amortization(143.3)(151.1)(156.4)
Interest expense, net(94.4)(99.0)(101.0)
Restructuring and other charges (See Note 3)(1,132.1)(4.5)— 
Impairment of goodwill (See Note 4)(287.0)— — 
Joint venture restructuring and impairment charge (See Note 9)(2.4)(11.4)— 
Gain on joint venture deconsolidation (See Note 9)— — 15.9 
Debt extinguishment charge (See Note 12)(21.5)(21.6)— 
Gain on asset sales, net2.5 89.8 — 
Income (loss) before income taxes$(1,481.9)$241.6 $247.7 
Corporate expenses were lower in 2020 compared to 2019 and 2018 primarily due to lower incentive compensation expense based on expected performance versus targeted metrics, and lower expenses resulting from cost reduction actions.
Closed operations and other expenses are primarily presented in selling and administrative expenses in the consolidated statements of operations. These items included costs at closed facilities, including legal matters, environmental, real estate and other facility costs, and changes in foreign currency remeasurement impacts primarily related to ATI's European Treasury Center operation. Closed operations and other expenses were lower in 2020 compared to 2019 and 2018, reflecting lower legal and retirement benefit expense of closed operations and a $4.3 million gain from settlements of contract indemnity obligations.
The $2.5 million net gain on asset sales in 2020 consists of a gain on the sale of certain oil and gas rights (see Note 11). The $89.8 million net gain on asset sales in 2019 consists of a $91.7 million gain on the sale of certain oil and gas rights (see Note 11) and a $6.2 million gain on the sale of the Company’s Cast Products business, partially offset by an $8.1 million loss on the sale of two non-core forging facilities, located in Portland, IN and Lebanon, KY. See Note 8 for further explanation regarding the sale of business transactions.
Certain additional information regarding the Company’s business segments is presented below:
(In millions)202020192018
Depreciation and amortization:
High Performance Materials & Components$78.1 $84.6 $90.6 
Advanced Alloys & Solutions62.1 63.5 62.9 
Other3.1 3.0 2.9 
Total depreciation and amortization$143.3 $151.1 $156.4 
Capital expenditures:
High Performance Materials & Components$83.1 $119.9 $71.7 
Advanced Alloys & Solutions45.9 47.4 64.5 
Corporate7.5 0.9 3.0 
Total capital expenditures$136.5 $168.2 $139.2 
Identifiable assets:202020192018
High Performance Materials & Components$1,753.9 $2,324.6 $2,400.7 
Advanced Alloys & Solutions1,548.8 2,621.1 2,590.4 
Corporate:
Deferred Taxes5.1 64.5 8.7 
Cash and cash equivalents and other727.1 624.4 502.0 
Total assets$4,034.9 $5,634.6 $5,501.8 
($ in millions)2020Percent
of total		2019Percent
of total		2018Percent
of total
Total assets:
United States$3,356.8 83 %$4,956.4 88 %$4,859.1 88 %
China325.5 8 %288.1 5 %287.3 5 %
United Kingdom122.4 3 %141.3 3 %136.7 3 %
Other230.2 6 %248.8 4 %218.7 4 %
Total Assets$4,034.9 100 %$5,634.6 100 %$5,501.8 100 %