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Revenue from Contracts with Customers | 12 Months Ended
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Dec. 31, 2019
Revenue from Contract with Customer [Abstract] |
Revenue from Contracts with Customers | Revenue from Contracts with Customers Adoption Method and Impact On January 1, 2018, the Company adopted ASC 606, Revenue from Contracts with Customers. The Company applied ASC 606 to all contracts not completed at January 1, 2018 and adopted the accounting standard using the modified retrospective method, with the cumulative effect of initially applying ASC 606 recognized at the beginning of the 2018 fiscal year. Comparative information has not been adjusted and continues to be reported under the previous accounting guidance. The Company recognized a $15.5 million increase to retained earnings at the beginning of the 2018 fiscal year for the cumulative effect of adoption of this standard, representing the favorable impact to prior results had the over-time revenue recognition requirements under ASC 606 been applied to several customer agreements. In addition, as a result of this over-time recognition of these customer agreements, fiscal year 2018 sales on the consolidated statement of operations were lower by $4.3 million and cost of sales were lower by $5.4 million as compared to what those amounts would have been under the previous revenue recognition guidance. On the consolidated balance sheet, inventories, net, were $5.4 million higher at December 31, 2018 as compared to what this amount would have been under the previous guidance. Also, $45.3 million of contract assets were recognized on the consolidated balance sheet at December 31, 2018 ($45.2 million in short-term contract assets and $0.1 million in other long-term assets) related to this over-time revenue recognition. There was no impact to cash flow from operating activities on the consolidated statement of cash flows as a result of this accounting standard adoption. Disaggregation of Revenue The Company operates in two business segments; High Performance Materials & Components (HPMC) and Flat Rolled Products (FRP). Revenue is disaggregated within these two business segments by diversified global markets, primary geographical markets, and diversified products. Comparative information of the Company’s overall revenues (in millions) by global and geographical markets for the fiscal years ended December 31, 2019, 2018 and 2017 were as follows:
(in millions) |  | 2019 |  | 2018 |  | 2017
|  | HPMC | FRP | Total |  | HPMC | FRP | Total |  | HPMC | FRP | Total
Diversified Global Markets: |  |  |  |  |  |  |  |  |  |  |  |
Aerospace & Defense |  | $ | 1,879.1 |  | $ | 251.3 |  | $ | 2,130.4 |  |  | $ | 1,771.3 |  | $ | 194.2 |  | $ | 1,965.5 |  |  | $ | 1,568.9 |  | $ | 149.2 |  | $ | 1,718.1 |
Oil & Gas |  | 64.3 |  | 446.3 |  | 510.6 |  |  | 74.9 |  | 471.3 |  | 546.2 |  |  | 63.9 |  | 354.3 |  | 418.2 |
Automotive |  | 10.5 |  | 286.1 |  | 296.6 |  |  | 9.5 |  | 313.9 |  | 323.4 |  |  | 8.8 |  | 264.9 |  | 273.7 |
Energy |  | 156.9 |  | 129.4 |  | 286.3 |  |  | 131.4 |  | 103.1 |  | 234.5 |  |  | 113.1 |  | 79.1 |  | 192.2 |
Food Equipment & Appliances |  | 0.3 |  | 205.5 |  | 205.8 |  |  | 0.4 |  | 244.5 |  | 244.9 |  |  | 1.1 |  | 224.9 |  | 226.0 |
Construction/Mining |  | 42.5 |  | 152.5 |  | 195.0 |  |  | 72.8 |  | 153.2 |  | 226.0 |  |  | 51.1 |  | 141.8 |  | 192.9 |
Medical |  | 159.2 |  | 13.2 |  | 172.4 |  |  | 168.5 |  | 14.6 |  | 183.1 |  |  | 170.4 |  | 12.6 |  | 183.0 |
Electronics/Computers/Communications |  | 5.8 |  | 157.4 |  | 163.2 |  |  | 7.9 |  | 149.0 |  | 156.9 |  |  | 4.4 |  | 147.2 |  | 151.6 |
Other |  | 79.5 |  | 82.7 |  | 162.2 |  |  | 97.5 |  | 68.6 |  | 166.1 |  |  | 85.7 |  | 83.7 |  | 169.4 |
Total |  | $ | 2,398.1 |  | $ | 1,724.4 |  | $ | 4,122.5 |  |  | $ | 2,334.2 |  | $ | 1,712.4 |  | $ | 4,046.6 |  |  | $ | 2,067.4 |  | $ | 1,457.7 |  | $ | 3,525.1 |
(in millions) |  | 2019 |  | 2018 |  | 2017
|  | HPMC | FRP | Total |  | HPMC | FRP | Total |  | HPMC | FRP | Total
Primary Geographical Market: |  |  |  |  |  |  |  |  |  |
United States |  | $ | 1,319.7 |  | $ | 1,134.9 |  | $ | 2,454.6 |  |  | $ | 1,214.1 |  | $ | 1,134.0 |  | $ | 2,348.1 |  |  | $ | 1,096.5 |  | $ | 974.1 |  | $ | 2,070.6 |
China |  | 103.0 |  | 252.6 |  | 355.6 |  |  | 83.1 |  | 236.9 |  | 320.0 |  |  | 51.1 |  | 214.5 |  | 265.6 |
Germany |  | 178.2 |  | 41.1 |  | 219.3 |  |  | 192.7 |  | 54.5 |  | 247.2 |  |  | 170.5 |  | 46.6 |  | 217.1 |
United Kingdom |  | 164.9 |  | 8.9 |  | 173.8 |  |  | 232.4 |  | 9.7 |  | 242.1 |  |  | 220.9 |  | 10.7 |  | 231.6 |
France |  | 145.8 |  | 9.7 |  | 155.5 |  |  | 172.7 |  | 10.9 |  | 183.6 |  |  | 157.8 |  | 7.8 |  | 165.6 |
Japan |  | 104.4 |  | 43.3 |  | 147.7 |  |  | 136.5 |  | 78.4 |  | 214.9 |  |  | 95.2 |  | 36.5 |  | 131.7 |
Rest of World |  | 382.1 |  | 233.9 |  | 616.0 |  |  | 302.7 |  | 188.0 |  | 490.7 |  |  | 275.4 |  | 167.5 |  | 442.9 |
Total |  | $ | 2,398.1 |  | $ | 1,724.4 |  | $ | 4,122.5 |  |  | $ | 2,334.2 |  | $ | 1,712.4 |  | $ | 4,046.6 |  |  | $ | 2,067.4 |  | $ | 1,457.7 |  | $ | 3,525.1 |
Comparative information of the Company’s major high-value and standard products based on their percentages of sales is included in the following table. FRP conversion services are excluded from this presentation.
|  | 2019 |  | 2018 |  | 2017
|  | HPMC | FRP | Total |  | HPMC | FRP | Total |  | HPMC | FRP | Total
Diversified Products: |  |  |  |  |  |  |  |  |  |  |  |
High-Value Products |  |  |  |  |  |  |  |  |  |  |  |
Nickel-based alloys and specialty alloys |  | 32 | % | 32 | % | 32 | % |  | 31 | % | 28 | % | 30 | % |  | 31 | % | 24 | % | 28 | %
Precision forgings, castings and components |  | 30 | % | — | % | 18 | % |  | 34 | % | — | % | 20 | % |  | 32 | % | — | % | 19 | %
Titanium and titanium-based alloys |  | 28 | % | 6 | % | 18 | % |  | 25 | % | 5 | % | 17 | % |  | 26 | % | 5 | % | 17 | %
Precision and engineered strip |  | — | % | 32 | % | 13 | % |  | — | % | 33 | % | 14 | % |  | — | % | 34 | % | 14 | %
Zirconium and related alloys |  | 10 | % | — | % | 6 | % |  | 10 | % | — | % | 5 | % |  | 11 | % | — | % | 6 | %
Total High-Value Products |  | 100 | % | 70 | % | 87 | % |  | 100 | % | 66 | % | 86 | % |  | 100 | % | 63 | % | 84 | %
Standard Products |  |  |  |  |  |  |  |  |  |  |  |
Standard stainless products |  | — | % | 30 | % | 13 | % |  | — | % | 34 | % | 14 | % |  | — | % | 37 | % | 16 | %
Total |  | 100 | % | 100 | % | 100 | % |  | 100 | % | 100 | % | 100 | % |  | 100 | % | 100 | % | 100 | %
The Company maintains a backlog of confirmed orders totaling $2.3 billion, $2.2 billion and $2.1 billion at December 31, 2019, 2018 and 2017, respectively. Due to the structure of the Company’s LTAs, 81% of this backlog at December 31, 2019 represented booked orders with performance obligations that will be satisfied within the next twelve months. The backlog does not reflect any elements of variable consideration. Accounts Receivable As of December 31, 2019 and 2018, accounts receivable with customers were $558.7 million and $533.8 million, respectively. The following represents the rollforward of accounts receivable - reserve for doubtful accounts for the fiscal years ended December 31, 2019, 2018 and 2017:
(in millions)
Accounts Receivable - Reserve for Doubtful Accounts
Balance as of December 31, 2016 | $ | 7.3 |
Expense to increase the reserve | 0.1 |
Write-off of uncollectible accounts | (1.5 | )
Balance as of December 31, 2017 | 5.9 |
Expense to increase the reserve | 1.9 |
Write-off of uncollectible accounts | (1.8 | )
Balance as of December 31, 2018 | 6.0 |
Expense to increase the reserve | 0.2 |
Write-off of uncollectible accounts | (1.6 | )
Balance as of December 31, 2019 | $ | 4.6 |
Contract balances The following represents the rollforward of contract assets and liabilities for the fiscal years ended December 31, 2019 and 2018:
(in millions)
Contract Assets
Short-term | 2019 | 2018
Balance as of beginning of fiscal year | $ | 51.2 |  | $ | 36.5 |
Recognized in current year | 74.5 |  | 92.9 |
Reclassified to accounts receivable | (79.9 | ) | (95.8 | )
Impairment | — |  | — |
Reclassification to/from long-term | — |  | 16.8 |
Divestiture | (7.3 | ) | — |
Other | — |  | 0.8 |
Balance as of period end | $ | 38.5 |  | $ | 51.2 |
Long-term | 2019 | 2018
Balance as of beginning of fiscal year | $ | 0.1 |  | $ | 16.9 |
Recognized in current year | — |  | — |
Reclassified to accounts receivable | — |  | — |
Impairment | — |  | — |
Reclassification to/from short-term | — |  | (16.8 | )
Balance as of period end | $ | 0.1 |  | $ | 0.1 |
(in millions)
Contract Liabilities
Short-term | 2019 | 2018
Balance as of beginning of fiscal year | $ | 71.4 |  | $ | 69.7 |
Recognized in current year | 126.1 |  | 76.7 |
Amounts in beginning balance reclassified to revenue | (49.2 | ) | (49.6 | )
Current year amounts reclassified to revenue | (76.0 | ) | (42.7 | )
Other | 1.9 |  | 2.7 |
Reclassification to/from long-term | 4.5 |  | 14.6 |
Balance as of period end | $ | 78.7 |  | $ | 71.4 |
Long-term | 2019 | 2018
Balance as of beginning of fiscal year | $ | 7.3 |  | $ | 22.2 |
Recognized in current year | 24.2 |  | 0.7 |
Amounts in beginning balance reclassified to revenue | (1.1 | ) | (1.0 | )
Current year amounts reclassified to revenue | — |  | — |
Other | — |  | — |
Reclassification to/from short-term | (4.5 | ) | (14.6 | )
Balance as of period end | $ | 25.9 |  | $ | 7.3 |
Contract costs for obtaining and fulfilling a contract were $6.5 million and $5.2 million as of December 31, 2019 and 2018, respectively, which are reported in other long-term assets on the consolidated balance sheet. Amortization expense for the fiscal years ended December 31, 2019 and 2018 of these contract costs was $1.4 million and $1.2 million, respectively.

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- References No definition available. + Details
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- Definition The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -URI http://asc.fasb.org/topic&trid=49130388 + Details
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