Business, Product and Geographical Area Information and Concentration of Risk

12 Months Ended

Dec. 31, 2018

Business, Product and Geographical Area Information and Concentration of Risk

Our primary line of business is the production of semi-fabricated specialty aluminum mill products, such as aluminum plate and sheet and extruded and drawn products, primarily used in Aero/HS products, Automotive Extrusions, GE products and Other products. We operate 12 focused production facilities in the United States and one in Canada. Our chief operating decision maker reviews and evaluates our business as a single operating segment. Prior to 2018, we reported our consolidated financial statements based on one reportable segment, Fabricated Products (comprised primarily of our manufacturing operations), and presented the business unit All Other (comprised primarily of corporate general and administrative expenses) as a reconciling item between Fabricated Products and our consolidated financial statements. During 2018, we determined that the All Other business unit had decreased in materiality and relevance and was therefore immaterial to our consolidated financial statements. Therefore, we no longer separate All Other from Fabricated Products for all periods presented in this Report and on a prospective basis.

At December 31, 2018, approximately 62% of our employees were covered by collective bargaining agreements and none of our employees were covered by collective bargaining agreements with expiration dates occurring within one year from December 31, 2018.

Net sales by end market applications and by timing of control transfer for each period presented were as follows (in millions of dollars):



	Year Ended December 31,
	2018		2017		2016
Net sales:
Aero/HS products	$	739.4	$	653.7	$	675.4
Automotive Extrusions	239.3		217.3		188.8
GE products	546.0		476.2		420.1
Other products	61.2		50.3		46.3
Total net sales	$	1,585.9	$	1,397.5	$	1,330.6

Timing of revenue recognition – Note 11:
Products transferred at a point in time	$	543.0	n/a		n/a
Products transferred over time	1,042.9		n/a		n/a
Total net sales	$	1,585.9

Geographic information for net sales based on country of origin, income taxes paid and long-lived assets were as follows (in millions of dollars):



	Year Ended December 31,
	2018		2017		2016
Net sales to unaffiliated customers:
Domestic	$	1,509.6	$	1,337.3	$	1,278.6
Foreign¹	76.3		60.2		52.0
Total net sales	$	1,585.9	$	1,397.5	$	1,330.6
Income taxes paid:
Domestic	$	1.6	$	1.2	$	0.7
Foreign	2.0		0.1		0.5
Total income taxes paid	$	3.6	$	1.3	$	1.2



	December 31,
	2018		2017		2016
Long-lived assets:²
Domestic	$	581.7	$	541.2	$	499.5
Foreign¹	30.1		30.2		31.4
Total long-lived assets	$	611.8	$	571.4	$	530.9

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^1.	Foreign reflects our London, Ontario production facility.


^2.	Long-lived assets represent Property, plant and equipment, net.

The aggregate foreign currency transaction gain (loss) included in determining net income were immaterial for 2018, 2017 and 2016.

For the years ended December 31, 2018, December 31, 2017 and December 31, 2016, one customer represented 25%, 27% and 26%, respectively, of Net sales and a second customer represented 15%, 12% and 10%, respectively, of Net sales.

One individual customer accounted for 31% and another individual customer accounted for 11% of the accounts receivable balance at December 31, 2018. One individual customer accounted for 22% and another individual customer accounted for 14% of the accounts receivable balance at December 31, 2017.

Information about export sales and primary aluminum supply from our major suppliers were as follows for the periods presented:



	Year Ended December 31,
	2018		2017		2016
Percentage of Net sales:
Export sales	15	%	18	%	19	%

Percentage of total annual primary aluminum supply (lbs):
Supply from our top five major suppliers	81	%	85	%	84	%
Supply from our largest supplier	22	%	36	%	32	%
Supply from our second and third largest suppliers combined	38	%	33	%	32	%