Business, Product and Geographical Area Information and Concentration of Risk

12 Months Ended

Dec. 31, 2024

Segment Reporting [Abstract]

Business, Product and Geographical Area Information and Concentration of Risk

17. 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 plate and sheet, bare and coated coils, and extruded and drawn products, primarily used in our Aero/HS Products, Packaging, GE Products, Automotive Extrusions and Other products end markets. We operate production facilities in the United States and Canada. Our Chairman, President and Chief Executive Officer is the chief operating decision maker (“CODM”) who evaluates our business as a single operating segment and makes decisions on resource allocations based on Net income (loss). The CODM uses Net income (loss) to evaluate income generated from the segment in deciding whether to reinvest profits into the segment or into other parts of the entity, such as for acquisitions or to pay dividends.

The following table provides the significant segment expenses that are provided to the CODM (in millions of dollars):

	Year Ended December 31,
	2024			2023			2022
Net sales	$	3,024.0		$	3,087.0		$	3,427.9
Less:
Cost of products sold, excluding depreciation and amortization
Hedged cost of alloyed metal1		1,567.8			1,621.1			2,045.2
Manufacturing costs2		805.2			809.9			773.0
Plant overhead3		170.5			164.6			162.3
Freight costs		91.6			103.3			125.5
Other cost of products sold4		56.0			56.0			74.2
Depreciation and amortization		116.4			108.6			106.9
Selling, general, administrative, research and development
Research and development costs		2.2			2.9			1.9
Employee costs5		83.3			80.0			69.9
Other selling, general and administrative costs6		35.3			39.8			39.1
Goodwill impairment		—			—			20.5
Restructuring costs		7.6			5.0			2.2
Other operating charges, net		0.4			—			3.2
Interest expense		43.7			46.9			48.3
Other income, net – Note 13		(19.5	)		(7.4	)		(6.4	)
Income tax provision (benefit)		16.7			9.1			(8.3	)
Net income (loss)	$	46.8		$	47.2		$	(29.6	)

1.Hedged cost of alloyed metal includes cost of aluminum at the Midwest transaction price and the cost of alloying elements used in the production process. This metric also includes metal price exposure on shipments that we hedged with realized losses upon settlement of $0.2 million, $21.4 million, and $17.0 million in 2024, 2023, and 2022, respectively.

2.Manufacturing costs primarily includes labor, utilities, supplies and other materials, excluding alloys incurred at our various production facilities.

3.Plant overhead includes salaried employee costs, property taxes, and insurance associated with our various production facilities.

4.Other costs of products sold primarily includes lease expense, accretion expense related to CAROs, and major maintenance costs.

5.Employee costs include salaries, benefits, and incentive compensation.

6.Other selling, general and administrative costs primarily includes professional services, computer hardware and software costs, office rent, and utilities.

The CODM does not review asset and capital expenditure information by reportable operating segment as such information is presented to the CODM on a consolidated basis.

The following table presents Net sales by end market applications and by timing of control transfer (in millions of dollars):

	Year Ended December 31,
	2024		2023		2022
Net sales:
Aero/HS Products	$	883.0	$	899.3	$	676.1
Packaging		1,260.9		1,315.2		1,585.3
GE Products		618.1		596.5		883.8
Automotive Extrusions		251.9		254.9		254.8
Other products		10.1		21.1		27.9
Total net sales	$	3,024.0	$	3,087.0	$	3,427.9
Timing of revenue recognition:
Products transferred at a point in time	$	2,326.5	$	2,394.8	$	2,782.9
Products transferred over time		697.5		692.2		645.0
Total net sales	$	3,024.0	$	3,087.0	$	3,427.9

The following table presents geographic information for net sales based on country of origin, income taxes paid, and long-lived assets (in millions of dollars):

	Year Ended December 31,
	2024		2023		2022
Net sales to unaffiliated customers:
Domestic	$	2,920.0	$	2,986.0	$	3,328.2
Foreign1		104.0		101.0		99.7
Total net sales	$	3,024.0	$	3,087.0	$	3,427.9
Income taxes paid:
Domestic	$	1.3	$	0.3	$	3.1
Foreign		3.1		0.2		3.2
Total income taxes paid	$	4.4	$	0.5	$	6.3

	As of December 31,
	2024		2023		2022
Long-lived assets:2
Domestic	$	1,134.5	$	1,025.3	$	984.8
Foreign1		26.7		26.8		28.4
Total long-lived assets	$	1,161.2	$	1,052.1	$	1,013.2

1.Foreign reflects our London, Ontario production facility.

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

The aggregate foreign currency transaction loss included in determining Net income (loss) was $0.3 million and $0.5 million for 2024 and 2022, respectively. The aggregate foreign currency transaction gain included in determining Net income was immaterial for 2023.

Concentrations. For the years ended December 31, 2024, December 31, 2023, and December 31, 2022, one customer represented 16%, 18%, and 19%, respectively, of Net sales, and a second customer represented 15%, 16%, and 14%, respectively, of Net sales.

One customer accounted for 17%, a second customer accounted for 17%, and a third customer accounted for 15% of the accounts receivable balance at December 31, 2024. One customer accounted for 20%, a second customer accounted for 13%, and a third customer accounted for 12% of the accounts receivable balance at December 31, 2023.

The following table presents information about export sales and primary aluminum supply from our major suppliers:

	Year Ended December 31,
	2024			2023			2022
Percentage of Net sales:
Export sales		10	%		10	%		10	%
Percentage of total annual primary aluminum supply (lbs):
Supply from our top five major suppliers		80	%		83	%		81	%
Supply from our largest supplier		21	%		37	%		48	%
Supply from our second and third largest suppliers combined		38	%		28	%		20	%

At December 31, 2024, approximately 65% of our employees were covered by collective bargaining agreements. In February 2025, the collective bargaining agreements expiring in 2025 (representing 39% of the covered employees) were renewed through September 2030 (see Note 18).