On June 30, 2014, the Company completed the separation of its steel business through the Spinoff, creating a new independent publicly traded company, TimkenSteel. The Company's Board of Directors declared a distribution of all outstanding common shares of TimkenSteel through a dividend. At the close of business on June 30, 2014, the Company's shareholders received one common share of TimkenSteel for every two common shares of the Company they held as of the close of business on June 23, 2014.

In connection with the Spinoff, the Company and TimkenSteel entered into certain transitional relationships, including a commercial supply agreement for TimkenSteel to supply the Company with certain steel products and other relationships described in the section of this Annual Report on Form 10-K titled "Risks Relating to the Spinoff of TimkenSteel."

The operating results, net of tax, included one-time transaction costs of approximately $57 million and $13 million for 2014 and 2013, respectively, in connection with the separation of the two companies. These costs primarily consisted of consulting and professional fees associated with preparing for and executing the Spinoff, as well as lease cancellation fees. In addition to the one time transaction costs, the Company incurred approximately $15 million of capital expenditures related to the Spinoff in 2014.

The following table presents the results of operations for TimkenSteel that have been reclassified to discontinued operations for all periods presented:



	Year Ended December 31,
	2014			2013
Net sales	$	786.2		$	1,305.8
Cost of goods sold	642.0			1,082.2
Gross profit	144.2			223.6
Selling, administrative and general expenses	46.4			80.5
Separation costs	57.1			13.0
Interest expense, net	0.8			—
Other (income) expense, net	(0.1		)	3.0
Income before income taxes	40.0			127.1
Income tax expense	16.0			39.6
Income from discontinued operations	$	24.0		$	87.5

The following table presents the carrying value of assets and liabilities immediately preceding the Spinoff on June 30, 2014.



	2014
ASSETS
Cash and cash equivalents	$	46.5
Accounts receivable, net	178.9
Inventories, net	238.2
Deferred income taxes	20.2
Other current assets	4.0
Property, plant, and equipment, net	751.6
Goodwill	12.6
Non-current pension assets	83.5
Other intangible assets	11.2
Other non-current assets	2.6
Total assets, discontinued operations	$	1,349.3
LIABILITIES
Accounts payable, trade	$	132.8
Salaries, wages and benefits	52.0
Income taxes payable	0.1
Other current liabilities	15.9
Long-term debt	130.2
Accrued pension cost	24.5
Accrued postretirement benefits cost	68.3
Deferred income taxes	91.7
Other non-current liabilities	10.7
Total liabilities, discontinued operations	$	526.2