Business Segments

6 Months Ended

Jun. 30, 2013

Segment Reporting Disclosure [Abstract]

Business Segments

Note 9. Business Segments

Following is certain financial information with respect to the Company's business segments for the periods indicated (in millions):

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2013		2012		2013		2012
Total sales:
High Performance Metals	$	500.9	$	587.6	$	1,039.2	$	1,195.4
Flat-Rolled Products		556.6		665.5		1,119.2		1,308.8
Engineered Products		106.4		143.2		220.2		287.0
		1,163.9		1,396.3		2,378.6		2,791.2
Intersegment sales:
High Performance Metals		16.4		21.4		36.3		47.9
Flat-Rolled Products		4.4		8.1		8.9		15.4
Engineered Products		7.6		9.4		18.5		18.0
		28.4		38.9		63.7		81.3
Sales to external customers:
High Performance Metals		484.5		566.2		1,002.9		1,147.5
Flat-Rolled Products		552.2		657.4		1,110.3		1,293.4
Engineered Products		98.8		133.8		201.7		269.0
	$	1,135.5	$	1,357.4	$	2,314.9	$	2,709.9
Operating profit:
High Performance Metals	$	67.2	$	102.2	$	142.5	$	206.3
Flat-Rolled Products		1.4		44.5		3.8		91.3
Engineered Products		3.1		13.2		3.7		25.5
Total operating profit		71.7		159.9		150.0		323.1
Corporate expenses		(11.9)		(15.8)		(24.3)		(37.5)
Interest expense, net		(13.9)		(18.6)		(28.3)		(38.5)
Closed company and other expenses		(5.7)		(5.2)		(9.4)		(12.1)
Retirement benefit expense		(32.5)		(30.6)		(65.0)		(61.2)
Income before income taxes	$	7.7	$	89.7	$	23.0	$	173.8

Retirement benefit expense represents defined benefit plan pension expense, and other postretirement benefit expense for both defined benefit and defined contribution plans. Operating profit with respect to the Company's business segments excludes any retirement benefit expense.Costs associated with multiemployer pension plans are included in segment operating profit, and costs associated with defined contribution pension plans are included in segment operating profit or corporate expenses, as applicable.

       Corporate expenses for the three months ended June 30, 2013 were $11.9 million compared to $15.8 million for the three months ended June 30, 2012. The decrease in corporate expenses was primarily related to lower incentive compensation expenses associated with annual and long-term performance plans.

       Interest expense, net of interest income, in the second quarter was $13.9 million, compared to net interest expense of $18.6 million in the second quarter 2012. The decrease in interest expense was primarily due to increased capitalized interest on major strategic capital projects. Interest expense benefited from the capitalization of interest costs of $10.6 million in the second quarter 2013 compared to $5.6 million in the second quarter 2012. The increased capitalized interest amounts are primarily related to the Hot-Rolling and Processing Facility (“HRPF”).

Closed company and other expenses primarily includes charges incurred in connection with closed operations and other non-operating income or expense. These items are presented primarily in selling and administrative expenses and in other expense in the statement of operations. These items resulted in net charges of $5.7 million for the three months ended June 30, 2013 and $5.2 million for the three months ended June 30, 2012.

Retirement benefit expense, which includes pension expense and other postretirement expense, increased to $32.5 million in the second quarter 2013, compared to $30.6 million in the second quarter 2012. This increase was primarily due to the utilization of a lower discount rate to value retirement benefit obligations.