XML 19 R11.htm IDEA: XBRL DOCUMENT
v3.22.2.2

Segment Information | 9 Months Ended
--- | ---
Sep. 30, 2022
Segment Reporting [Abstract] |
Segment Information | Segment Information Howmet is a global leader in lightweight metals engineering and manufacturing. Howmet’s innovative, multi-material products, which include nickel, titanium, aluminum, and cobalt, are used worldwide in the aerospace (commercial and defense), commercial transportation, and industrial and other markets. Segment performance under Howmet’s management reporting system is evaluated based on a number of factors; however, the primary measure of performance is Segment Adjusted EBITDA. Prior to the first quarter of 2022, the Company used Segment operating profit as its primary measure of performance. However, the Company’s Chief Executive Officer believes that Segment Adjusted EBITDA is now a better representation of its business because it provides additional information with respect to the Company’s operating performance and the Company’s ability to meet its financial obligations. Howmet’s definition of Segment Adjusted EBITDA (Earnings before interest, taxes, depreciation, and amortization) is net margin plus an add-back for depreciation and amortization. Net margin is equivalent to Sales minus the following items: Cost of goods sold; Selling, general administrative, and other expenses; Research and development expenses; and Provision for depreciation and amortization. Special items, including Restructuring and other charges, are excluded from Net margin and Segment Adjusted EBITDA. Segment Adjusted EBITDA may not be comparable to similarly titled measures of other companies. Differences between the total segment and consolidated totals are in Corporate. Howmet’s operations consist of four worldwide reportable segments as follows: Engine Products Engine Products produces investment castings, including airfoils, and seamless rolled rings primarily for aircraft engines and industrial gas turbines. Engine Products produces rotating parts as well as structural parts. Fastening Systems Fastening Systems produces aerospace fastening systems, as well as commercial transportation, industrial and other fasteners. The business’s high-tech, multi-material fastening systems are found nose to tail on aircraft and aero engines. Fastening Systems’ products are also critical components of commercial transportation vehicles, automobiles, construction and industrial equipment, and renewable energy sectors. Engineered Structures Engineered Structures produces titanium ingots and mill products for aerospace and defense applications and is vertically integrated to produce titanium forgings, extrusions, forming and machining services for airframe, wing, aero-engine, and landing gear components. Engineered Structures also produces aluminum forgings, nickel forgings, and aluminum machined components and assemblies for aerospace and defense applications. Forged Wheels Forged Wheels provides forged aluminum wheels and related products for heavy-duty trucks and the commercial transportation market. The operating results of the Company’s reportable segments were as follows:
| Engine Products |  | Fastening Systems |  | Engineered Structures |  | Forged Wheels |  | Total Segment
Third quarter ended September 30, 2022 |  |  |  |  |  |  |  |  |
Sales: |  |  |  |  |  |  |  |  |
Third-party sales | $ | 683 |  |  | $ | 291 |  |  | $ | 193 |  |  | $ | 266 |  |  | $ | 1,433 |
Inter-segment sales | 1 |  |  | — |  |  | 3 |  |  | — |  |  | 4 |
Total sales | $ | 684 |  |  | $ | 291 |  |  | $ | 196 |  |  | $ | 266 |  |  | $ | 1,437 |
Profit and loss: |  |  |  |  |  |  |  |  |
Provision for depreciation and amortization | $ | 31 |  |  | $ | 11 |  |  | $ | 12 |  |  | $ | 10 |  |  | $ | 64 |
Segment Adjusted EBITDA | 186 |  |  | 64 |  |  | 28 |  |  | 64 |  |  | 342 |
Restructuring and other charges | 2 |  |  | — |  |  | 1 |  |  | — |  |  | 3 |
Capital expenditures | 23 |  |  | 7 |  |  | 3 |  |  | 6 |  |  | 39 |
Third quarter ended September 30, 2021 |  |  |  |  |  |  |  |  |
Sales: |  |  |  |  |  |  |  |  |
Third-party sales | $ | 599 |  |  | $ | 254 |  |  | $ | 199 |  |  | $ | 231 |  |  | $ | 1,283 |
Inter-segment sales | 1 |  |  | — |  |  | 1 |  |  | — |  |  | 2 |
Total sales | $ | 600 |  |  | $ | 254 |  |  | $ | 200 |  |  | $ | 231 |  |  | $ | 1,285 |
Profit and loss: |  |  |  |  |  |  |  |  |
Provision for depreciation and amortization | $ | 31 |  |  | $ | 12 |  |  | $ | 12 |  |  | $ | 10 |  |  | $ | 65 |
Segment Adjusted EBITDA | 151 |  |  | 59 |  |  | 26 |  |  | 72 |  |  | 308 |
Restructuring and other charges | 5 |  |  | 3 |  |  | — |  |  | — |  |  | 8 |
Capital expenditures | 21 |  |  | 8 |  |  | 3 |  |  | 15 |  |  | 47 |
| Engine Products |  | Fastening Systems |  | Engineered Structures |  | Forged Wheels |  | Total Segment
Nine months ended September 30, 2022 |  |  |  |  |  |  |  |  |
Sales: |  |  |  |  |  |  |  |  |
Third-party sales | $ | 1,966 |  |  | $ | 832 |  |  | $ | 560 |  |  | $ | 792 |  |  | $ | 4,150 |
Inter-segment sales | 3 |  |  | — |  |  | 5 |  |  | — |  |  | 8 |
Total sales | $ | 1,969 |  |  | $ | 832 |  |  | $ | 565 |  |  | $ | 792 |  |  | $ | 4,158 |
Profit and loss: |  |  |  |  |  |  |  |  |
Provision for depreciation and amortization | $ | 93 |  |  | $ | 34 |  |  | $ | 36 |  |  | $ | 30 |  |  | $ | 193 |
Segment Adjusted EBITDA | 538 |  |  | 176 |  |  | 77 |  |  | 206 |  |  | 997 |
Restructuring and other charges (credits) | 9 |  |  | (3) |  |  | 4 |  |  | — |  |  | 10 |
Capital expenditures | 74 |  |  | 30 |  |  | 12 |  |  | 20 |  |  | 136 |
Nine months ended September 30, 2021 |  |  |  |  |  |  |  |  |
Sales: |  |  |  |  |  |  |  |  |
Third-party sales | $ | 1,677 |  |  | $ | 788 |  |  | $ | 535 |  |  | $ | 687 |  |  | $ | 3,687 |
Inter-segment sales | 3 |  |  | — |  |  | 4 |  |  | — |  |  | 7 |
Total sales | $ | 1,680 |  |  | $ | 788 |  |  | $ | 539 |  |  | $ | 687 |  |  | $ | 3,694 |
Profit and loss: |  |  |  |  |  |  |  |  |
Provision for depreciation and amortization | $ | 92 |  |  | $ | 37 |  |  | $ | 37 |  |  | $ | 29 |  |  | $ | 195 |
Segment Adjusted EBITDA | 413 |  |  | 179 |  |  | 72 |  |  | 222 |  |  | 886 |
Restructuring and other charges | 15 |  |  | 8 |  |  | 1 |  |  | — |  |  | 24 |
Capital expenditures | 48 |  |  | 22 |  |  | 13 |  |  | 37 |  |  | 120 |
The following table reconciles Total Segment Adjusted EBITDA to Income before income taxes. Differences between the total segment and consolidated totals are in Corporate.
| Third quarter ended |  | Nine months ended
| September 30, |  | September 30,
| 2022 |  | 2021 |  | 2022 |  | 2021
Total Segment Adjusted EBITDA | $ | 342 |  |  | $ | 308 |  |  | $ | 997 |  |  | $ | 886 |
Segment provision for depreciation and amortization | (64) |  |  | (65) |  |  | (193) |  |  | (195) |
Unallocated amounts: |  |  |  |  |  |  |
Restructuring and other charges | (4) |  |  | (8) |  |  | (12) |  |  | (22) |
Corporate expense | (46) |  |  | (30) |  |  | (93) |  |  | (68) |
Operating income | $ | 228 |  |  | $ | 205 |  |  | $ | 699 |  |  | $ | 601 |
Loss on debt redemption | — |  |  | (118) |  |  | (2) |  |  | (141) |
Interest expense, net | (57) |  |  | (63) |  |  | (172) |  |  | (201) |
Other expense, net (Q) | (67) |  |  | (1) |  |  | (67) |  |  | (13) |
Income before income taxes | $ | 104 |  |  | $ | 23 |  |  | $ | 458 |  |  | $ | 246 |
The following table reconciles total segment capital expenditures with Capital expenditures as presented in the Statement of Consolidated Cash Flows.
| Third quarter ended |  | Nine months ended
| September 30, |  | September 30,
| 2022 |  | 2021 |  | 2022 |  | 2021
Total segment capital expenditures | $ | 39 |  |  | $ | 47 |  |  | $ | 136 |  |  | $ | 120 |
Corporate | 3 |  |  | — |  |  | 12 |  |  | 18 |
Capital expenditures | $ | 42 |  |  | $ | 47 |  |  | $ | 148 |  |  | $ | 138 |
The following table disaggregates segment revenue by major market served. Differences between the total segment and consolidated totals are in Corporate.
| Engine Products |  | Fastening Systems |  | Engineered Structures |  | Forged Wheels |  | Total Segment
Third quarter ended September 30, 2022 |  |  |  |  |  |  |  |  |
Aerospace - Commercial | $ | 388 |  |  | $ | 156 |  |  | $ | 124 |  |  | $ | — |  |  | $ | 668 |
Aerospace - Defense | 124 |  |  | 43 |  |  | 56 |  |  | — |  |  | 223 |
Commercial Transportation | — |  |  | 63 |  |  | — |  |  | 266 |  |  | 329 |
Industrial and Other | 171 |  |  | 29 |  |  | 13 |  |  | — |  |  | 213 |
Total end-market revenue | $ | 683 |  |  | $ | 291 |  |  | $ | 193 |  |  | $ | 266 |  |  | $ | 1,433 |
Third quarter ended September 30, 2021 |  |  |  |  |  |  |  |  |
Aerospace - Commercial | $ | 299 |  |  | $ | 126 |  |  | $ | 118 |  |  | $ | — |  |  | $ | 543 |
Aerospace - Defense | 130 |  |  | 37 |  |  | 65 |  |  | — |  |  | 232 |
Commercial Transportation | — |  |  | 59 |  |  | — |  |  | 231 |  |  | 290 |
Industrial and Other | 170 |  |  | 32 |  |  | 16 |  |  | — |  |  | 218 |
Total end-market revenue | $ | 599 |  |  | $ | 254 |  |  | $ | 199 |  |  | $ | 231 |  |  | $ | 1,283 |
Nine months ended September 30, 2022 |  |  |  |  |  |  |  |  |
Aerospace - Commercial | $ | 1,079 |  |  | $ | 459 |  |  | $ | 341 |  |  | $ | — |  |  | $ | 1,879 |
Aerospace - Defense | 384 |  |  | 112 |  |  | 176 |  |  | — |  |  | 672 |
Commercial Transportation | — |  |  | 169 |  |  | — |  |  | 792 |  |  | 961 |
Industrial and Other | 503 |  |  | 92 |  |  | 43 |  |  | — |  |  | 638 |
Total end-market revenue | $ | 1,966 |  |  | $ | 832 |  |  | $ | 560 |  |  | $ | 792 |  |  | $ | 4,150 |
Nine months ended September 30, 2021 |  |  |  |  |  |  |  |  |
Aerospace - Commercial | $ | 786 |  |  | $ | 403 |  |  | $ | 277 |  |  | $ | — |  |  | $ | 1,466 |
Aerospace - Defense | 402 |  |  | 120 |  |  | 206 |  |  | — |  |  | 728 |
Commercial Transportation | — |  |  | 154 |  |  | — |  |  | 687 |  |  | 841 |
Industrial and Other | 489 |  |  | 111 |  |  | 52 |  |  | — |  |  | 652 |
Total end-market revenue | $ | 1,677 |  |  | $ | 788 |  |  | $ | 535 |  |  | $ | 687 |  |  | $ | 3,687 |
The Company derive d 61% and 60% of its revenue from the aerospace market for the nine months ended September 30, 2022 and 2021, respectively. General Electric Company represented approximately 13% of the Company’s third-party sales for both the nine months ended September 30, 2022 and 2021, primarily from Engine Products.

X
- References No definition available. + Details
Name: | us-gaap_SegmentReportingAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8924-108599 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8981-108599 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8721-108599 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9031-108599 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (f) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (e) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (d) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 22 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8736-108599 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9054-108599 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 15 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8657-108599 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8721-108599 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI https://asc.fasb.org/topic&trid=2134510 + Details
Name: | us-gaap_SegmentReportingDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration