Business Segments

3 Months Ended

Mar. 31, 2023

Segment Reporting [Abstract]

Business Segments

Business Segments

The Company operates in two business segments: High Performance Materials & Components (HPMC) and Advanced Alloys & Solutions (AA&S). The measure of segment EBITDA categorically excludes income taxes, depreciation and amortization, corporate expenses, net interest expense, closed operations and other income (expense), charges for goodwill and asset impairments, restructuring and other credits/charges, strike related costs, debt extinguishment charges and gains or losses on asset sales and sales of businesses. Management believes segment EBITDA, 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 March 31,
	2023		2022
Total sales:
High Performance Materials & Components	$	529.6	$	380.8
Advanced Alloys & Solutions	625.8		535.6
	1,155.4		916.4
Intersegment sales:
High Performance Materials & Components	58.5		39.2
Advanced Alloys & Solutions	58.8		43.1
	117.3		82.3
Sales to external customers:
High Performance Materials & Components	471.1		341.6
Advanced Alloys & Solutions	567.0		492.5
	$	1,038.1	$	834.1

	Three months ended March 31,
	2023		2022
EBITDA:
High Performance Materials & Components	$	80.1	$	68.1
Advanced Alloys & Solutions	72.7		75.3
Total segment EBITDA	152.8		143.4
Corporate expenses	(17.3)		(17.0)
Closed operations and other expense	(2.8)		(1.4)
Depreciation & amortization (a)	(35.1)		(35.5)
Interest expense, net	(19.9)		(23.6)
Restructuring and other charges	(1.2)		(7.5)
Loss on asset sales and sales of businesses, net	—		(18.3)
Income before income taxes	$	76.5	$	40.1

a) The following is depreciation & amortization by each business segment:

	Three months ended March 31,
	2023		2022
High Performance Materials & Components	$	17.4	$	17.9
Advanced Alloys & Solutions	16.1		16.2
Other	1.6		1.4
	$	35.1	$	35.5

Beginning in 2020, the U.S. government enacted various relief packages in response to the COVID-19 pandemic. First quarter 2022 results include $29 million related to this government sponsored COVID relief in segment EBITDA. HPMC segment results for the first quarter of 2022 include $22 million of benefits from the Aviation Manufacturing Jobs Protection Program and employee retention credits, and AA&S segment results for the first quarter of 2022 include $7 million in employee retention credits.

Restructuring and other charges of $1.2 million for the first quarter of 2023 related to costs to restart the Company’s titanium operations in Albany, OR, which are included within cost of sales on the consolidated statements of operations. Restructuring and other charges for the first quarter of 2022 relate to an $8.6 million charge for a litigation reserve, which is reported in other nonoperating income (expense) on the consolidated statement of operations, partially offset by a $1.1 million restructuring credit for a reduction in severance-related reserves. Loss on asset sales and sales of businesses, net, for the first quarter of 2022 relate to a $25.1 million loss on the sale of the Company’s Sheffield, UK operations, partially offset by a $6.8 million gain from the sale of assets from the Pico Rivera, CA operations.