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Financial Information for Subsidiary and Guarantor Parent
 6 Months Ended
Jun. 30, 2019
Condensed Financial Information Disclosure [Abstract]  
Financial Information for Subsidiary and Guarantor Parent Financial Information for Subsidiary and Guarantor Parent
The payment obligations under the $150 million 6.95% Debentures due 2025 issued by Allegheny Ludlum, LLC (the “Subsidiary”) are fully and unconditionally guaranteed by Allegheny Technologies Incorporated (the “Guarantor Parent”). In accordance with positions established by the Securities and Exchange Commission, the following financial information sets forth separately financial information with respect to the Subsidiary, the non-guarantor subsidiaries and the Guarantor Parent. The principal elimination entries eliminate investments in subsidiaries and certain intercompany balances and transactions.
ATI is the plan sponsor for the U.S. qualified defined benefit pension plans, which cover certain current and former employees of the Subsidiary and the non-guarantor subsidiaries. As a result, the balance sheets presented for the Subsidiary and the non-guarantor subsidiaries do not include any U.S. qualified defined benefit pension assets or liabilities, or the related deferred taxes and valuation allowances. These assets, liabilities and related deferred taxes and pension income or expense are recognized by the Guarantor Parent. Management and royalty fees charged to the Subsidiary and to the non-guarantor subsidiaries by the Guarantor Parent have been excluded solely for purposes of this presentation. The effects of income tax valuation allowances on U.S. Federal and State deferred tax assets are excluded from the Subsidiary’s financial results, and are reported by the Guarantor Parent or the non-guarantor subsidiaries, as applicable.

Allegheny Technologies Incorporated
Financial Information for Subsidiary and Guarantor Parent
Balance Sheets
June 30, 2019
(In millions)
Guarantor
Parent
 
Subsidiary
 
Non-guarantor
Subsidiaries
 
Eliminations
 
Consolidated
Assets:
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
7.4

 
$
7.7

 
$
266.1

 
$
—

 
$
281.2

Accounts receivable, net
—

 
151.6

 
429.8

 
—

 
581.4

Intercompany notes receivable
—

 
—

 
4,330.2

 
(4,330.2
)
 
—

Short-term contract assets
—

 
—

 
40.9

 
—

 
40.9

Inventories, net
—

 
265.2

 
952.3

 
—

 
1,217.5

Prepaid expenses and other current assets
6.5

 
60.7

 
73.2

 
—

 
140.4

Total current assets
13.9

 
485.2

 
6,092.5

 
(4,330.2
)
 
2,261.4

Property, plant and equipment, net
3.1

 
1,533.4

 
868.4

 
—

 
2,404.9

Goodwill
—

 
—

 
524.8

 
—

 
524.8

Intercompany notes receivable
—

 
—

 
200.0

 
(200.0
)
 
—

Investment in subsidiaries
6,367.3

 
37.7

 
—

 
(6,405.0
)
 
—

Other assets
55.0

 
55.2

 
248.0

 
—

 
358.2

Total assets
$
6,439.3

 
$
2,111.5

 
$
7,933.7

 
$
(10,935.2
)
 
$
5,549.3

Liabilities and stockholders’ equity:
 
 
 
 
 
 
 
 
 
Accounts payable
$
6.0

 
$
154.2

 
$
260.4

 
$
—

 
$
420.6

Intercompany notes payable
2,300.7

 
2,029.5

 
—

 
(4,330.2
)
 
—

Short-term contract liabilities
—

 
48.0

 
21.3

 
—

 
69.3

Short-term debt and current portion of long-term debt
0.5

 
—

 
11.0

 
—

 
11.5

Other current liabilities
53.6

 
71.6

 
132.6

 
—

 
257.8

Total current liabilities
2,360.8

 
2,303.3

 
425.3

 
(4,330.2
)
 
759.2

Long-term debt
1,281.1

 
149.7

 
106.3

 
—

 
1,537.1

Intercompany notes payable
—

 
200.0

 
—

 
(200.0
)
 
—

Accrued postretirement benefits
—

 
254.8

 
50.6

 
—

 
305.4

Pension liabilities
622.5

 
3.7

 
43.4

 
—

 
669.6

Deferred income taxes
15.1

 
—

 
—

 
—

 
15.1

Other long-term liabilities
21.2

 
35.8

 
67.3

 
—

 
124.3

Total liabilities
4,300.7

 
2,947.3

 
692.9

 
(4,530.2
)
 
3,410.7

Total stockholders’ equity (deficit)
2,138.6

 
(835.8
)
 
7,240.8

 
(6,405.0
)
 
2,138.6

Total liabilities and stockholders’ equity
$
6,439.3

 
$
2,111.5

 
$
7,933.7

 
$
(10,935.2
)
 
$
5,549.3



Allegheny Technologies Incorporated
Financial Information for Subsidiary and Guarantor Parent
Statements of Income and Comprehensive Income
For the three months ended June 30, 2019  
(In millions)
Guarantor
Parent
 
Subsidiary
 
Non-guarantor
Subsidiaries
 
Eliminations
 
Consolidated
Sales
$
—

 
$
366.7

 
$
713.7

 
$
—

 
$
1,080.4

Cost of sales
2.9

 
327.5

 
572.3

 
—

 
902.7

Gross profit (loss)
(2.9
)
 
39.2

 
141.4

 
—

 
177.7

Selling and administrative expenses
28.9

 
8.0

 
30.8

 
—

 
67.7

Operating income (loss)
(31.8
)
 
31.2

 
110.6

 
—

 
110.0

Nonoperating retirement benefit expense
(11.8
)
 
(6.1
)
 
(0.5
)
 
—

 
(18.4
)
Interest income (expense), net
(38.2
)
 
(34.3
)
 
46.6

 
—

 
(25.9
)
Other income (loss) including equity in income of unconsolidated subsidiaries
166.1

 
(3.7
)
 
21.8

 
(165.6
)
 
18.6

Income (loss) before income tax provision (benefit)
84.3

 
(12.9
)
 
178.5

 
(165.6
)
 
84.3

Income tax provision (benefit)
5.8

 
(3.1
)
 
27.2

 
(24.1
)
 
5.8

Net income (loss)
78.5

 
(9.8
)
 
151.3

 
(141.5
)
 
78.5

Less: Net income attributable to noncontrolling interests
—

 
—

 
3.4

 
—

 
3.4

Net income (loss) attributable to ATI
$
78.5

 
$
(9.8
)
 
$
147.9

 
$
(141.5
)
 
$
75.1

Comprehensive income (loss) attributable to ATI
$
86.0

 
$
(6.7
)
 
$
143.2

 
$
(136.3
)
 
$
86.2



Allegheny Technologies Incorporated
Financial Information for Subsidiary and Guarantor Parent
Statements of Income and Comprehensive Income
For the six months ended June 30, 2019  

(In millions)
Guarantor
Parent
 
Subsidiary
 
Non-guarantor
Subsidiaries
 
Eliminations
 
Consolidated
Sales
$
—

 
$
702.2

 
$
1,383.0

 
$
—

 
$
2,085.2

Cost of sales
6.1

 
645.9

 
1,124.4

 
—

 
1,776.4

Gross profit (loss)
(6.1
)
 
56.3

 
258.6

 
—

 
308.8

Selling and administrative expenses
59.3

 
15.4

 
61.0

 
—

 
135.7

Operating income (loss)
(65.4
)
 
40.9

 
197.6

 
—

 
173.1

Nonoperating retirement benefit expense
(23.5
)
 
(12.3
)
 
(0.9
)
 
—

 
(36.7
)
Interest income (expense), net
(76.1
)
 
(68.2
)
 
93.6

 
—

 
(50.7
)
Other income (loss) including equity in income of unconsolidated subsidiaries
266.4

 
(6.6
)
 
21.4

 
(265.5
)
 
15.7

Income (loss) before income tax provision (benefit)
101.4

 
(46.2
)
 
311.7

 
(265.5
)
 
101.4

Income tax provision (benefit)
6.6

 
(11.1
)
 
57.1

 
(46.0
)
 
6.6

Net income (loss)
94.8

 
(35.1
)
 
254.6

 
(219.5
)
 
94.8

Less: Net income attributable to noncontrolling interests
—

 
—

 
4.7

 
—

 
4.7

Net income (loss) attributable to ATI
$
94.8

 
$
(35.1
)
 
$
249.9

 
$
(219.5
)
 
$
90.1

Comprehensive income (loss) attributable to ATI
$
145.8

 
$
(28.8
)
 
$
251.0

 
$
(228.5
)
 
$
139.5



Condensed Statements of Cash Flows
For the six months ended June 30, 2019  
(In millions)
Guarantor
Parent
 
Subsidiary
 
Non-guarantor
Subsidiaries
 
Eliminations
 
Consolidated
Cash flows provided by (used in) operating activities
$
(56.2
)
 
$
(186.9
)
 
$
138.7

 
$
—

 
$
(104.4
)
Investing Activities:
 
 
 
 
 
 
 
 
 
Purchases of property, plant and equipment
(0.5
)
 
(8.1
)
 
(42.7
)
 
—

 
(51.3
)
Net receipts/(payments) on intercompany activity
—

 
—

 
(266.1
)
 
266.1

 
—

Proceeds from sale of businesses, net of transaction costs
—

 
—

 
33.4

 
—

 
33.4

Proceeds from disposal of property, plant and equipment
—

 
—

 
29.4

 
—

 
29.4

Other
(0.1
)
 
—

 
—

 
—

 
(0.1
)
Cash flows provided by (used in) investing activities
(0.6
)
 
(8.1
)
 
(246.0
)
 
266.1

 
11.4

Financing Activities:
 
 
 
 
 
 
 
 
 
Payments on long-term debt and finance leases
(0.2
)
 
—

 
(3.1
)
 
—

 
(3.3
)
Net borrowings under credit facilities
—

 
—

 
5.4

 
—

 
5.4

Net receipts/(payments) on intercompany activity
74.2

 
191.9

 
—

 
(266.1
)
 
—

Shares repurchased for income tax withholding on share-based compensation and other

(9.9
)
 
—

 
—

 
—

 
(9.9
)
Cash flows provided by (used in) financing activities
64.1

 
191.9

 
2.3

 
(266.1
)
 
(7.8
)
Increase (decrease) in cash and cash equivalents
$
7.3

 
$
(3.1
)
 
$
(105.0
)
 
$
—

 
$
(100.8
)

Allegheny Technologies Incorporated
Financial Information for Subsidiary and Guarantor Parent
Balance Sheets
December 31, 2018
 
Guarantor
 
 
 
Non-guarantor
 
 
 
 
(In millions)
Parent
 
Subsidiary
 
Subsidiaries
 
Eliminations
 
Consolidated
Assets:
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
0.1

 
$
10.8

 
$
371.1

 
$
—

 
$
382.0

Accounts receivable, net
—

 
126.3

 
401.5

 
—

 
527.8

Intercompany notes receivable
—

 
—

 
3,968.8

 
(3,968.8
)
 
—

Short-term contract assets
—

 
—

 
51.2

 
—

 
51.2

Inventories, net
—

 
216.1

 
995.0

 
—

 
1,211.1

Prepaid expenses and other current assets
12.9

 
29.3

 
32.4

 
—

 
74.6

Total current assets
13.0

 
382.5

 
5,820.0

 
(3,968.8
)
 
2,246.7

Property, plant and equipment, net
1.7

 
1,548.4

 
924.9

 
—

 
2,475.0

Goodwill
—

 
—

 
534.7

 
—

 
534.7

Intercompany notes receivable
—

 
—

 
200.0

 
(200.0
)
 
—

Investment in subsidiaries
6,096.4

 
37.7

 
—

 
(6,134.1
)
 
—

Other assets
35.6

 
30.7

 
179.1

 
—

 
245.4

Total assets
$
6,146.7

 
$
1,999.3

 
$
7,658.7

 
$
(10,302.9
)
 
$
5,501.8

Liabilities and stockholders’ equity:
 
 
 
 
 
 
 
 
 
Accounts payable
$
3.3

 
$
177.5

 
$
318.0

 
$
—

 
$
498.8

Intercompany notes payable
2,102.8

 
1,866.0

 
—

 
(3,968.8
)
 
—

Short-term contract liabilities
—

 
33.0

 
38.4

 
—

 
71.4

Short-term debt and current portion of long-term debt
0.2

 
0.7

 
5.7

 
—

 
6.6

Other current liabilities
59.1

 
71.7

 
129.3

 
—

 
260.1

Total current liabilities
2,165.4

 
2,148.9

 
491.4

 
(3,968.8
)
 
836.9

Long-term debt
1,278.8

 
151.8

 
104.9

 
—

 
1,535.5

Intercompany notes payable
—

 
200.0

 
—

 
(200.0
)
 
—

Accrued postretirement benefits
—

 
259.2

 
59.2

 
—

 
318.4

Pension liabilities
681.6

 
4.0

 
44.4

 
—

 
730.0

Deferred income taxes
12.9

 
—

 
—

 
—

 
12.9

Other long-term liabilities
16.4

 
17.6

 
42.5

 
—

 
76.5

Total liabilities
4,155.1

 
2,781.5

 
742.4

 
(4,168.8
)
 
3,510.2

Total stockholders’ equity (deficit)
1,991.6

 
(782.2
)
 
6,916.3

 
(6,134.1
)
 
1,991.6

Total liabilities and stockholders’ equity
$
6,146.7

 
$
1,999.3

 
$
7,658.7

 
$
(10,302.9
)
 
$
5,501.8















Allegheny Technologies Incorporated
Financial Information for Subsidiary and Guarantor Parent
Statements of Operations and Comprehensive Income
For the three months ended June 30, 2018
(In millions)
Guarantor
Parent
 
Subsidiary
 
Non-guarantor
Subsidiaries
 
Eliminations
 
Consolidated
Sales
$
—

 
$
343.2

 
$
666.3

 
$
—

 
$
1,009.5

Cost of sales
3.9

 
323.3

 
508.6

 
—

 
835.8

Gross profit (loss)
(3.9
)
 
19.9

 
157.7

 
—

 
173.7

Selling and administrative expenses
24.4

 
7.6

 
30.7

 
—

 
62.7

Operating income (loss)
(28.3
)
 
12.3

 
127.0

 
—

 
111.0

Nonoperating retirement benefit expense
(3.5
)
 
(4.8
)
 
(0.5
)
 
—

 
(8.8
)
Interest income (expense), net
(34.2
)
 
(28.1
)
 
36.8

 
—

 
(25.5
)
Other income (loss) including equity in income of unconsolidated subsidiaries
146.5

 
2.3

 
0.2

 
(145.2
)
 
3.8

Income (loss) before income tax provision (benefit)
80.5

 
(18.3
)
 
163.5

 
(145.2
)
 
80.5

Income tax provision (benefit)
4.9

 
(4.5
)
 
24.9

 
(20.4
)
 
4.9

Net income (loss)
75.6

 
(13.8
)
 
138.6

 
(124.8
)
 
75.6

Less: Net income attributable to noncontrolling interests
—

 
—

 
2.8

 
—

 
2.8

Net income (loss) attributable to ATI
$
75.6

 
$
(13.8
)
 
$
135.8

 
$
(124.8
)
 
$
72.8

Comprehensive income (loss) attributable to ATI
$
73.1

 
$
(11.5
)
 
$
112.8

 
$
(101.0
)
 
$
73.4



Allegheny Technologies Incorporated
Financial Information for Subsidiary and Guarantor Parent
Statements of Operations and Comprehensive Income
For the six months ended June 30, 2018

(In millions)
Guarantor
Parent
 
Subsidiary
 
Non-guarantor
Subsidiaries
 
Eliminations
 
Consolidated
Sales
$
—

 
$
689.6

 
$
1,298.9

 
$
—

 
$
1,988.5

Cost of sales
8.0

 
646.5

 
1,011.7

 
—

 
1,666.2

Gross profit (loss)
(8.0
)
 
43.1

 
287.2

 
—

 
322.3

Selling and administrative expenses
48.1

 
17.9

 
63.8

 
—

 
129.8

Operating income (loss)
(56.1
)
 
25.2

 
223.4

 
—

 
192.5

Nonoperating retirement benefit expense
(6.6
)
 
(9.7
)
 
(0.8
)
 
—

 
(17.1
)
Interest income (expense), net
(67.2
)
 
(53.8
)
 
70.0

 
—

 
(51.0
)
Other income (loss) including equity in income of unconsolidated subsidiaries
275.9

 
19.1

 
0.7

 
(274.1
)
 
21.6

Income (loss) before income tax provision (benefit)
146.0

 
(19.2
)
 
293.3

 
(274.1
)
 
146.0

Income tax provision (benefit)
9.9

 
(4.3
)
 
45.1

 
(40.8
)
 
9.9

Net income (loss)
136.1

 
(14.9
)
 
248.2

 
(233.3
)
 
136.1

Less: Net income attributable to noncontrolling interests
—

 
—

 
5.3

 
—

 
5.3

Net income (loss) attributable to ATI
$
136.1

 
$
(14.9
)
 
$
242.9

 
$
(233.3
)
 
$
130.8

Comprehensive income (loss) attributable to ATI
$
176.1

 
$
(10.2
)
 
$
236.8

 
$
(235.7
)
 
$
167.0



Condensed Statements of Cash Flows
For the six months ended June 30, 2018

(In millions)
Guarantor
Parent
 
Subsidiary
 
Non-guarantor
Subsidiaries
 
Eliminations
 
Consolidated
Cash flows provided by (used in) operating activities
$
(54.2
)
 
$
(137.9
)
 
$
227.1

 
$
—

 
$
35.0

Investing Activities:
 
 
 
 
 
 
 
 
 
Purchases of property, plant and equipment
(1.0
)
 
(14.4
)
 
(55.2
)
 
—

 
(70.6
)
Net receipts/(payments) on intercompany activity
—

 
—

 
(197.1
)
 
197.1

 
—

Proceeds from disposal of property, plant and equipment
—

 
0.9

 
0.1

 
—

 
1.0

Other
—

 
—

 
(0.2
)
 
—

 
(0.2
)
Cash flows provided by (used in) investing activities
(1.0
)
 
(13.5
)
 
(252.4
)
 
197.1

 
(69.8
)
Financing Activities:
 
 
 
 
 
 
 
 
 
Borrowings on long-term debt
—

 
—

 
7.1

 
—

 
7.1

Payments on long-term debt and finance leases
(0.1
)
 
(0.2
)
 
(2.5
)
 
—

 
(2.8
)
Net borrowings under credit facilities
—

 
—

 
3.4

 
—

 
3.4

Net receipts/(payments) on intercompany activity
61.6

 
135.5

 
—

 
(197.1
)
 
—

Sale to noncontrolling interests
—

 
11.7

 
2.7

 
—

 
14.4

Shares repurchased for income tax withholding on share-based compensation
(6.5
)
 
—

 
—

 
—

 
(6.5
)
Cash flows provided by (used in) financing activities
55.0

 
147.0

 
10.7

 
(197.1
)
 
15.6

Decrease in cash and cash equivalents
$
(0.2
)
 
$
(4.4
)
 
$
(14.6
)
 
$
—

 
$
(19.2
)