Property, Plant and Equipment

9 Months Ended

Sep. 30, 2024

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment

Note 3 – Property, Plant and Equipment

Property, plant and equipment were comprised of the following:

	September 30, 2024			December 31, 2023
Land and land improvements	$	9,038		$	9,025
Buildings and leasehold improvements		71,711			71,063
Machinery and equipment		382,253			366,044
Construction-in-progress		3,580			11,514
Other		6,299			6,965
		472,881			464,611
Accumulated depreciation and amortization		(320,351	)		(305,879	)
Property, plant and equipment, net	$	152,530		$	158,732

Certain of the above property, plant and equipment are held as collateral including:

•The land and building of Union Electric Steel UK Limited (“UES-UK”), an indirect subsidiary of the Corporation, with a book value equal to $2,841 (£2,122) at September 30, 2024, are held as collateral by the trustees of the UES-UK defined benefit pension plan (Note 7).

•Certain of the machinery and equipment with a book value equal to $24,239 at September 30, 2024, purchased with proceeds from the equipment finance facility (Note 6), are held as collateral by the lender.

•Certain land and land improvements and buildings and leasehold improvements are included in the sale and leaseback financing transactions and Disbursement Agreement (Note 6). Title to these assets lies with the lender; however, since the transactions qualified as financing transactions, versus sales, the assets remain recorded on the Corporation’s condensed consolidated balance sheet.

•The remaining assets, other than real property, are pledged as collateral for the Corporation’s revolving credit facility (Note 6).

In 2023, Union Electric Steel Corporation (“UES”), a wholly owned subsidiary of the Corporation, completed certain leasehold improvements at the Carnegie, Pennsylvania manufacturing facility with the $2,500 of proceeds from the Disbursement Agreement (Note 6). The improvements are being amortized over the remaining lease term of 20 years.

In 2021, the Corporation began a $26,000 long-term strategic capital program to upgrade existing equipment at certain of its FCEP locations. The program was completed and the assets were placed in service during the first half of 2024. Interest capitalized related to the strategic capital program approximated $251 for the nine months ended September 30, 2024 and $425 and $1,027 for the three and nine months ended September 30, 2023, respectively. No interest was capitalized for the three months ended September 30, 2024.

The gross value of assets under finance leases and the related accumulated amortization approximated $3,539 and $1,876, respectively, as of September 30, 2024 and $4,223 and $1,959, respectively, at December 31, 2023. Depreciation expense approximated $4,497 and $4,295, including depreciation of assets under finance leases of approximately $80 and $115, for the three months ended September 30, 2024 and 2023, respectively. Depreciation expense approximated $13,692 and $12,844, including depreciation of assets under finance leases of approximately $242 and $252, for the nine months ended September 30, 2024 and 2023, respectively.