Segment and Geographical Area Information

12 Months Ended

Dec. 31, 2013

Segment Reporting [Abstract]

Segment and Geographical Area Information

Segment and Geographical Area Information

The Company's primary line of business is the production of semi-fabricated specialty aluminum products, such as aluminum sheet and plate and extruded and drawn products, primarily used in aerospace/high strength, general engineering, automotive, and other industrial end market applications. The Company operates 11 focused production facilities in the United States and one in Canada. Consistent with the manner in which the Company's chief operating decision maker reviews and evaluates the Company's business, the Fabricated Products business is treated as a single operating segment.

In addition to the Fabricated Products segment, the Company has two business units, Corporate and Other and Secondary Aluminum. The Corporate and Other business unit provides general and administrative support for the Company's operations. The Secondary Aluminum business unit activities related to the Company’s purchase and resale to a third party of secondary aluminum produced by Anglesey until Anglesey ceased its remelt and casting operations at its facility in Holyhead, Wales in the quarter ended June 30, 2013. The Company owned a 49% non-controlling interest in Anglesey until selling its ownership interest in the quarter ended December 31, 2013.

For purposes of segment reporting under GAAP, the Company treats the Fabricated Products segment as a reportable segment and combines the two other business units, Corporate and Other and Secondary Aluminum, into one category, which is referred to as All Other. All Other is not considered a reportable segment.

The accounting policies of the Fabricated Products segment are the same as those described in Note 1. Segment results are evaluated internally by management before any allocation of corporate overhead and without any charge for income taxes, interest expense, or Other operating charges, net.

The following tables provide financial information by reporting segment for each period or as of each period end, as applicable:

	Year Ended December 31,
	2013			2012			2011
Net Sales:
Fabricated Products	$	1,297.5		$	1,360.1		$	1,301.3
Operating Income (Loss):
Fabricated Products 1,2	$	188.6		$	190.8		$	83.6
All Other3	(15.3		)	(24.9		)	(28.6		)
Total operating income	$	173.3		$	165.9		$	55.0
Interest expense	(35.7		)	(29.1		)	(18.0		)
Other income, net	5.6			2.8			4.3
Income before income taxes	$	143.2		$	139.6		$	41.3
Depreciation and Amortization:
Fabricated Products	$	27.6		$	26.0		$	24.8
All Other	0.5			0.5			0.4
Total depreciation and amortization	$	28.1		$	26.5		$	25.2
Capital expenditures:
Fabricated Products	$	69.8		$	43.8		$	32.1
All Other	0.6			0.3			0.4
Total capital expenditures	$	70.4		$	44.1		$	32.5

	December 31, 2013		December 31, 2012		December 31, 2011
Assets:
Fabricated Products	$	852.5	$	771.2	$	637.0
All Other4	918.4		981.3		683.6
Total assets	$	1,770.9	$	1,752.5	$	1,320.6

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¹  Operating results in the Fabricated Products segment for 2013, 2012 and 2011 included non-cash LIFO inventory benefits of $24.1, $4.9 and $7.1, respectively. Also included in the Fabricated Products segment operating results for 2013, 2012 and 2011 were $4.0, $1.1 and $1.7, respectively, of environmental expense. Fabricated Products segment operating results for 2012 also included $4.4 of asset impairment charge relating to certain property, plant and equipment.

²  Fabricated Products segment results for 2013, 2012 and 2011 include non-cash mark-to-market gains (losses) on primary aluminum, natural gas, electricity and foreign currency hedging activities totaling $0.7, $15.2 and $(29.9), respectively. For further discussion regarding mark-to-market matters, see Note 11.

³  Operating results in All Other represent operating expenses in the Corporate and Other business unit. Operating results of All Other include VEBA net periodic pension benefit income of $22.5, $11.9 and $6.0 for 2013, 2012 and 2011, respectively.

⁴  Assets in All Other represent primarily all of the Company’s cash and cash equivalents, short-term investments, financial derivative assets, net assets in respect of VEBA(s) and net deferred income tax assets.

Net sales by product categories, which are based on end market applications, for the Fabricated Products segment are as follows:

	Year Ended December 31,
	2013		2012		2011
Net Sales:
Aero/HS Products	$	677.0	$	695.1	$	596.3
GE Products	411.0		441.4		447.0
Automotive Extrusions	129.5		125.5		126.9
Other Products	80.0		98.1		131.1
Total Net Sales	$	1,297.5	$	1,360.1	$	1,301.3

Geographic information for net sales, based on country of origin, income taxes paid, and long-lived assets are as follows:

	Year Ended December 31,
	2013		2012		2011
Net sales to unaffiliated customers:
Fabricated Products —
United States	$	1,204.7	$	1,256.5	$	1,195.1
Canada	92.8		103.6		106.2
Total net sales	$	1,297.5	$	1,360.1	$	1,301.3
Income taxes paid:
Fabricated Products —
United States	$	1.2	$	0.5	$	1.7
Canada	0.9		1.3		1.8
Total income taxes paid	$	2.1	$	1.8	$	3.5

	December 31, 2013		December 31, 2012		December 31, 2011
Long-lived assets:1
Fabricated Products —
United States	$	409.5	$	367.5	$	351.4
Canada	15.3		12.5		11.9
Total Fabricated Products long-lived assets	424.8		380.0		363.3
All Other —
United States	4.5		4.3		4.5
Total All Other long-lived assets	4.5		4.3		4.5
Total long-lived assets	$	429.3	$	384.3	$	367.8

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¹    Long-lived assets represent Property, plant and equipment, net.

The aggregate foreign currency transaction gains (losses) included in determining net income were immaterial for 2013, 2012, and 2011.

The Company depends on a core group of significant customers and suppliers of primary aluminum. The loss of the Company’s largest customer or supplier would have a material adverse effect on the Company taken as a whole. However, in the Company’s opinion, the relationship between the Company and its customers and suppliers is good, and the risk of loss of the customer or supplier is remote. Information for sales to the Company's largest Fabricated Products customer, export sales, and primary aluminum supply from the Company's major suppliers are as follows:

	Year Ended December 31,
	2013		2012		2011
Percentage of Total Revenue:
Sales to largest Fabricated Products customer	23	%	22	%	21	%
Export sales	17	%	18	%	14	%
Percentage of Total Annual Primary Aluminum Supply
Supply from the Company's top five major suppliers	86	%	78	%	83	%
Supply from the Company's largest supplier	25	%	29	%	32	%
Supply from the Company's second and third largest suppliers	35	%	31	%	34	%