Business Segment Information

3 Months Ended

Mar. 31, 2020

We aggregate our operating businesses into two reportable segments. The factors considered in determining our reportable segments are the economic similarity of the businesses, the nature of products sold or services provided, the production

processes and the types of customers and distribution methods. Our reportable segments are managed separately based on these differences.

Our Sealing Products segment designs, manufactures and sells sealing products, including: metallic, non-metallic and composite material gaskets, dynamic seals, compression packing, resilient metal seals, elastomeric seals, custom-engineered mechanical seals for applications in the aerospace industry and other markets, hydraulic components, expansion joints, flange sealing and isolation products, pipeline casing spacers/isolators, casing end seals, modular sealing systems for sealing pipeline penetrations, sanitary gaskets, hoses and fittings for the hygienic process industries, fluid transfer products for the pharmaceutical and biopharmaceutical industries, hole forming products, manhole infiltration sealing systems, bellows and bellows assemblies, pedestals for semiconductor manufacturing, PTFE products, and heavy-duty commercial vehicle parts used in the wheel-end, braking, and suspension. In addition to these products, we also provide cleaning and refurbishment services for critical components and assemblies used in state-of-the-art semiconductor equipment. The equipment serviced is used to produce advanced microchips for smartphones, autonomous vehicles, high-speed wireless connectivity, artificial intelligence, and other applications.

Our Engineered Products segment includes operations that design, manufacture and sell self-lubricating, non-rolling metal-polymer, solid polymer and filament wound bearing products, aluminum blocks for hydraulic applications, and precision engineered components and lubrication systems for reciprocating compressors.

Segment profit is total segment revenue reduced by operating expenses, restructuring and other costs identifiable with the segment. Corporate expenses include general corporate administrative costs. Expenses not directly attributable to the segments, corporate expenses, net interest expense, gains and losses related to the sale of assets, and income taxes are not included in the computation of segment profit. The accounting policies of the reportable segments are the same as those for EnPro.

Segment operating results and other financial data for the three months ended March 31, 2020 and 2019 were as follows:



	2020			2019
	(in millions)
Sales
Sealing Products	$	216.1		$	224.5
Engineered Products	67.9			79.5
	284.0			304.0
Intersegment sales	(1.3		)	(1.0		)
Net sales	$	282.7		$	303.0
Segment Profit
Sealing Products	$	25.7		$	20.8
Engineered Products	3.4			6.2
Total segment profit	29.1			27.0
Corporate expenses	(8.5		)	(9.6		)
Interest expense, net	(4.0		)	(4.5		)
Other income (expense), net	1.3			(2.3		)
Income from continuing operations before income taxes	$	17.9		$	10.6

Segment assets are as follows:



	March 31, 2020		December 31, 2019
	(in millions)
Sealing Products	$	1,317.2	$	1,337.6
Engineered Products	235.2		238.3
Corporate	489.2		205.1
Discontinued operations	—		254.1
	$	2,041.6	$	2,035.1

Backlog

As of March 31, 2020, the aggregate amount of transaction price of remaining performance obligations, or backlog, on a consolidated basis was $202.9 million. Approximately 96% of these obligations are expected to be satisfied within one year. There is no certainty these orders will result in actual sales at the times or in the amounts ordered. In addition, for most of our business, this total is not particularly predictive of future performance because of our short lead times and some seasonality.

Revenue by End Market

Due to the diversified nature of our business and the wide array of products that we offer, we sell into a number of end markets. Underlying economic conditions within these markets are a major driver of our segments' sales performance. Below is a summary of our third party sales by major end market with which we did business for the three months ended March 31, 2020 and 2019:



	Three Months Ended March 31, 2020
(in millions)	Sealing Products		Engineered Products		Total
Aerospace	$	12.5	$	2.3	$	14.8
Automotive	0.2		20.5		20.7
Chemical and material processing	12.9		10.1		23.0
Food and pharmaceutical	11.2		0.5		11.7
General industrial	46.0		19.4		65.4
Medium-duty/heavy-duty truck	68.8		0.1		68.9
Oil and gas	15.0		10.4		25.4
Power generation	9.9		4.4		14.3
Semiconductors	36.5		—		36.5
Other	1.9		0.1		2.0
Total third party sales	$	214.9	$	67.8	$	282.7



	Three Months Ended March 31, 2019
(in millions)	Sealing Products		Engineered Products		Total
Aerospace	$	12.1	$	2.7	$	14.8
Automotive	1.0		23.3		24.3
Chemical and material processing	15.4		12.2		27.6
Food and pharmaceutical	9.7		0.2		9.9
General industrial	43.5		26.3		69.8
Medium-duty/heavy-duty truck	89.2		0.2		89.4
Oil and gas	14.3		10.5		24.8
Power generation	10.6		2.4		13.0
Semiconductors	25.6		—		25.6
Other	2.3		1.5		3.8
Total third party sales	$	223.7	$	79.3	$	303.0