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Business Segments
 6 Months Ended
Jun. 30, 2019
Segment Reporting [Abstract]  
Business Segments Business Segments
The Company operates in two business segments: High Performance Materials & Components and Flat Rolled Products. The measure of segment operating profit, which is used to analyze the performance and results of the business segments, excludes all effects of LIFO inventory accounting and any related changes in net realizable value inventory reserves which offset the Company’s aggregate net debit LIFO valuation balance, income taxes, corporate expenses, net interest expense, closed operations and other expenses, restructuring and asset impairment charges, and non-operating gains and losses. Management believes segment operating profit, as defined, provides an appropriate measure of controllable operating results at the business segment level. Following is certain financial information with respect to the Company’s business segments for the periods indicated (in millions):
 
Three months ended June 30,
 
Six months ended June 30,
 
2019
 
2018
 
2019
 
2018
Total sales:
 
 
 
 
 
 
 
High Performance Materials & Components
$
673.8

 
$
611.7

 
$
1,297.7

 
$
1,191.1

Flat Rolled Products
461.8

 
439.3

 
889.0

 
878.4

 
1,135.6

 
1,051.0

 
2,186.7

 
2,069.5

Intersegment sales:
 
 
 
 
 
 
 
High Performance Materials & Components
31.4

 
19.8

 
54.1

 
38.5

Flat Rolled Products
23.8

 
21.7

 
47.4

 
42.5

 
55.2

 
41.5

 
101.5

 
81.0

Sales to external customers:
 
 
 
 
 
 
 
High Performance Materials & Components
642.4

 
591.9

 
1,243.6

 
1,152.6

Flat Rolled Products
438.0

 
417.6

 
841.6

 
835.9

 
$
1,080.4

 
$
1,009.5

 
$
2,085.2

 
$
1,988.5



 
Three months ended June 30,
 
Six months ended June 30,
 
2019
 
2018
 
2019
 
2018
Operating profit:
 
 
 
 
 
 
 
High Performance Materials & Components
$
98.9

 
$
97.9

 
$
171.5

 
$
183.4

Flat Rolled Products
15.6

 
26.1

 
4.7

 
37.0

Total operating profit
114.5

 
124.0

 
176.2

 
220.4

LIFO and net realizable value reserves
—

 
—

 
(0.1
)
 
—

Corporate expenses
(18.0
)
 
(12.9
)
 
(34.6
)
 
(26.1
)
Closed operations and other expenses
(7.9
)
 
(5.1
)
 
(11.0
)
 
(13.2
)
Gain on joint venture deconsolidation (See Note 6)
—

 
—

 
—

 
15.9

Gain on asset sales, net
21.6

 
—

 
21.6

 
—

Interest expense, net
(25.9
)
 
(25.5
)
 
(50.7
)
 
(51.0
)
Income before income taxes
$
84.3

 
$
80.5

 
$
101.4

 
$
146.0



The $21.6 million gain on asset sales, net consists of a $29.3 million gain on the sale of a portion of the Company’s oil and gas rights in Eddy County, NM (see Note 7), partially offset by a $7.7 million loss on the sale of two non-core forging facilities, located in Portland, IN and Lebanon, KY (see Note 5).

Corporate expenses were higher in the second quarter and six months of 2019 compared to 2018, primarily due to higher expense for company-owned life insurance policies and costs related to non-core asset transactions. Closed operations and other expenses were higher in the second quarter 2019 compared to 2018, primarily due to foreign currency remeasurement losses in 2019 compared to gains in 2018 from the Company’s European Treasury Center.