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Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
FORM 10-Q

(Mark One) |  |  |
☒ |  | Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the Quarterly Period Ended | March 31, 2023
Or
☐ |  | Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the Transition Period from to .

Commission file number 001-10716
TRIMAS CORPORATION
(Exact name of registrant as specified in its charter)

Delaware |  | 38-2687639
(State or other jurisdiction of incorporation or organization) |  | (IRS Employer Identification No.)

38505 Woodward Avenue, Suite 200
Bloomfield Hills, Michigan 48304
(Address of principal executive offices, including zip code)
(248) 631-5450
(Registrant's telephone number, including area code)

Title of each class | Trading symbol(s) | Name of exchange on which registered
Common stock, $0.01 par value | TRS | The NASDAQ Stock Market LLC

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐.
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer | ☒ |  | Accelerated filer | ☐
Non-accelerated filer | ☐ |  | Smaller reporting company | ☐
|  |  | Emerging growth company | ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
As of April 20, 2023, the number of outstanding shares of the Registrant's common stock, $0.01 par value, was 41,496,268 shares.

Table of Contents
TriMas Corporation
Index

Part I. |  | Financial Information |
|  |  |  | Forward-Looking Statements | 2
|  | Item 1. |  | Consolidated Financial Statements | 3
|  |  |  | Consolidated Balance Sheet as of March 3 1, 202 3 and December 31, 202 2 | 3
|  |  |  | Consolidated Statement of Income for the Three Months Ended March 3 1, 202 3 and 20 2 2 | 4
|  |  |  | Consolidated Statement of Comprehensive Income for the Three Months Ended March 3 1, 202 3 and 202 2 | 5
|  |  |  | Consolidated Statement of Cash Flows for the Three Months Ended March 3 1, 202 3 and 202 2 | 6
|  |  |  | Consolidated Statement of Shareholders' Equity for the Three Months Ended March 3 1, 202 3 and 202 2 | 7
|  |  |  | Notes to Consolidated Financial Statements | 8
|  | Item 2. |  | Management's Discussion and Analysis of Financial Condition and Results of Operations | 22
|  | Item 3. |  | Quantitative and Qualitative Disclosures about Market Risk | 34
|  | Item 4. |  | Controls and Procedures | 34
Part II. |  | Other Information |
|  | Item 1. |  | Legal Proceedings | 35
|  | Item 1A. |  | Risk Factors | 35
|  | Item 2. |  | Unregistered Sales of Equity Securities and Use of Proceeds | 35
|  | Item 3. |  | Defaults Upon Senior Securities | 35
|  | Item 4. |  | Mine Safety Disclosures | 35
|  | Item 5. |  | Other Information | 35
|  | Item 6. |  | Exhibits | 36
|  | Signature s | 37

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Forward-Looking Statements
This report may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 about our financial condition, results of operations and business. These forward-looking statements can be identified by the use of forward-looking words, such as “may,” “could,” “should,” “estimate,” “project,” “forecast,” “intend,” “expect,” “anticipate,” “believe,” “target,” “plan” or other comparable words, or by discussions of strategy that may involve risks and uncertainties.
These forward-looking statements are subject to numerous assumptions, risks and uncertainties which could materially affect our business, financial condition or future results including, but not limited to: general economic and currency conditions; the severity and duration of the ongoing coronavirus (“COVID-19”) pandemic; competitive factors; market demand; our ability to realize our business strategies; our ability to identify attractive acquisition candidates, successfully integrate acquired operations or realize the intended benefits of such acquisitions; pressures on our supply chain, including availability of raw materials and inflationary pressures on raw material and energy costs, and customers; the performance of our subcontractors and suppliers; risks and uncertainties associated with intangible assets, including goodwill or other intangible asset impairment charges; risks associated with a concentrated customer base; information technology and other cyber-related risks; risks related to our international operations, including, but not limited to, risks relating to rising tensions between the United States and China; government and regulatory actions, including, without limitation, climate change legislation and other environmental regulations, as well as the impact of tariffs, quotas and surcharges; changes to fiscal and tax policies; intellectual property factors; uncertainties associated with our ability to meet customers’ and suppliers’ sustainability and environmental, social and governance (“ESG”) goals and achieve our sustainability and ESG goals in alignment with our own announced targets; litigation; contingent liabilities relating to acquisition activities; interest rate volatility; our leverage; liabilities imposed by our debt instruments; labor disputes and shortages; the disruption of operations from catastrophic or extraordinary events, including, but not limited to, natural disasters, geopolitical conflicts and public health crises, such as the ongoing coronavirus pandemic; the amount and timing of future dividends and/or share repurchases, which remain subject to Board approval and depend on market and other conditions; our future prospects; and other risks that are discussed in Part I, Item 1A, "Risk Factors," in our Annual Report on Form 10-K for the year ended December 31, 2022 and elsewhere in this report. The risks described in our Annual Report on Form 10-K and elsewhere in this report are not the only risks facing our Company. Additional risks and uncertainties not currently known to us or that we currently deemed to be immaterial also may materially adversely affect our business, financial position and results of operations or cash flows.
The cautionary statements set forth above should be considered in connection with any subsequent written or oral forward-looking statements that we or persons acting on our behalf may issue. We caution readers not to place undue reliance on the statements, which speak only as of the date of this report. We do not undertake any obligation to review or confirm analysts' expectations or estimates or to release publicly any revisions to any forward-looking statement to reflect events or circumstances after the date of this report or to reflect the occurrence of unanticipated events, except as required by law.
We disclose important factors that could cause our actual results to differ materially from our expectations implied by our forward-looking statements under Part I, Item 2, "Management's Discussion and Analysis of Financial Condition and Results of Operations," and elsewhere in this report. These cautionary statements qualify all forward-looking statements attributed to us or persons acting on our behalf. When we indicate that an event, condition or circumstance could or would have an adverse effect on us, we mean to include effects upon our business, financial and other conditions, results of operations, prospects and ability to service our debt.
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PART I. FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements
TriMas Corporation
Consolidated Balance Sheet
(Dollars in thousands)

|  | March 31, 2023 |  | December 31, 2022
Assets |  | (unaudited) |  |
Current assets: |  |  |  |
Cash and cash equivalents |  | $ | 51,890 |  |  | $ | 112,090 |
Receivables, net of reserves of $1.7 million as of March 31, 2023 and December 31, 2022 |  | 149,580 |  |  | 132,370 |
Inventories |  | 171,750 |  |  | 163,360 |
Prepaid expenses and other current assets |  | 18,020 |  |  | 14,840 |
Total current assets |  | 391,240 |  |  | 422,660 |
Property and equipment, net |  | 295,220 |  |  | 277,750 |
Operating lease right-of-use assets |  | 47,040 |  |  | 47,280 |
Goodwill |  | 361,590 |  |  | 339,810 |
Other intangibles, net |  | 194,840 |  |  | 188,110 |
Deferred income taxes |  | 9,100 |  |  | 9,400 |
Other assets |  | 20,340 |  |  | 19,990 |
Total assets |  | $ | 1,319,370 |  |  | $ | 1,305,000 |
Liabilities and Shareholders' Equity |  |  |  |
Current liabilities: |  |  |  |
Accounts payable |  | $ | 85,770 |  |  | $ | 85,210 |
Accrued liabilities |  | 53,930 |  |  | 46,660 |
Lease liabilities, current portion |  | 9,040 |  |  | 8,280 |
Total current liabilities |  | 148,740 |  |  | 140,150 |
Long-term debt, net |  | 394,960 |  |  | 394,730 |
Lease liabilities |  | 42,190 |  |  | 41,010 |
Deferred income taxes |  | 26,080 |  |  | 20,940 |
Other long-term liabilities |  | 58,640 |  |  | 56,340 |
Total liabilities |  | 670,610 |  |  | 653,170 |
Preferred stock, $0.01 par: Authorized 100,000,000 shares; Issued and outstanding: None |  | — |  |  | — |
Common stock, $0.01 par: Authorized 400,000,000 shares; Issued and outstanding: 41,509,463 shares at March 31, 2023 and 41,724,762 shares at December 31, 2022 |  | 420 |  |  | 420 |
Paid-in capital |  | 684,730 |  |  | 696,160 |
Accumulated deficit |  | (31,220) |  |  | (36,130) |
Accumulated other comprehensive income (loss) |  | (5,170) |  |  | (8,620) |
Total shareholders' equity |  | 648,760 |  |  | 651,830 |
Total liabilities and shareholders' equity |  | $ | 1,319,370 |  |  | $ | 1,305,000 |

The accompanying notes are an integral part of these consolidated financial statements.
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TriMas Corporation
Consolidated Statement of Income
(Unaudited—dollars in thousands, except for per share amounts)

|  |  |  | Three months ended March 31,
|  |  |  |  |  | 2023 |  | 2022
Net sales |  |  |  |  |  | $ | 215,460 |  |  | $ | 224,310 |
Cost of sales |  |  |  |  |  | (167,770) |  |  | (170,600) |
Gross profit |  |  |  |  |  | 47,690 |  |  | 53,710 |
Selling, general and administrative expenses |  |  |  |  |  | (37,700) |  |  | (31,780) |
Operating profit |  |  |  |  |  | 9,990 |  |  | 21,930 |
Other expense, net: |  |  |  |  |  |  |  |
Interest expense |  |  |  |  |  | (3,700) |  |  | (3,410) |
Other income (expense), net |  |  |  |  |  | (70) |  |  | (280) |
Other expense, net |  |  |  |  |  | (3,770) |  |  | (3,690) |
Income before income tax expense |  |  |  |  |  | 6,220 |  |  | 18,240 |
Income tax expense |  |  |  |  |  | (1,310) |  |  | (4,070) |
Net income |  |  |  |  |  | $ | 4,910 |  |  | $ | 14,170 |
Basic earnings per share: |  |  |  |  |  |  |  |
Net income per share |  |  |  |  |  | $ | 0.12 |  |  | $ | 0.33 |
Weighted average common shares—basic |  |  |  |  |  | 41,543,625 |  |  | 42,799,206 |
Diluted earnings per share: |  |  |  |  |  |  |  |
Net income per share |  |  |  |  |  | $ | 0.12 |  |  | $ | 0.33 |
Weighted average common shares—diluted |  |  |  |  |  | 41,802,037 |  |  | 43,109,693 |

The accompanying notes are an integral part of these consolidated financial statements.
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TriMas Corporation
Consolidated Statement of Comprehensive Income
(Unaudited—dollars in thousands)

|  |  |  | Three months ended March 31,
|  |  |  |  |  | 2023 |  | 2022
Net income |  |  |  |  |  | $ | 4,910 |  |  | $ | 14,170 |
Other comprehensive income (loss): |  |  |  |  |  |  |  |
Defined benefit plans (Note 16) |  |  |  |  |  | 20 |  |  | 240 |
Foreign currency translation |  |  |  |  |  | 5,290 |  |  | (4,040) |
Derivative instruments (Note 9) |  |  |  |  |  | (1,860) |  |  | 1,560 |
Total other comprehensive income (loss) |  |  |  |  |  | 3,450 |  |  | (2,240) |
Total comprehensive income |  |  |  |  |  | $ | 8,360 |  |  | $ | 11,930 |

The accompanying notes are an integral part of these consolidated financial statements.
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TriMas Corporation
Consolidated Statement of Cash Flows
(Unaudited—dollars in thousands)

|  | Three months ended March 31,
|  | 2023 |  | 2022
Cash Flows from Operating Activities: |  |  |  |
Net income |  | $ | 4,910 |  |  | $ | 14,170 |
Adjustments to reconcile net income to net cash provided by operating activities, net of acquisition impact: |  |  |  |
(Gain) loss on dispositions of assets |  | (10) |  |  | 20 |
Depreciation |  | 8,760 |  |  | 8,470 |
Amortization of intangible assets |  | 4,590 |  |  | 5,290 |
Amortization of debt issue costs |  | 230 |  |  | 220 |
Deferred income taxes |  | 2,070 |  |  | 3,000 |
Non-cash compensation expense |  | 2,940 |  |  | 2,820 |
Increase in receivables |  | (11,850) |  |  | (22,330) |
Increase in inventories |  | (1,590) |  |  | (910) |
Decrease (increase) in prepaid expenses and other assets |  | 1,490 |  |  | (680) |
Decrease in accounts payable and accrued liabilities |  | (2,360) |  |  | (5,210) |
Other operating activities |  | 510 |  |  | 810 |
Net cash provided by operating activities, net of acquisition impact |  | 9,690 |  |  | 5,670 |
Cash Flows from Investing Activities: |  |  |  |
Capital expenditures |  | (14,790) |  |  | (11,890) |
Acquisition of businesses, net of cash acquired |  | (37,790) |  |  | (63,950) |
Net proceeds from disposition of property and equipment |  | 10 |  |  | 20 |
Net cash used for investing activities |  | (52,570) |  |  | (75,820) |
Cash Flows from Financing Activities: |  |  |  |
Proceeds from borrowings on revolving credit facilities |  | 10,840 |  |  | — |
Repayments of borrowings on revolving credit facilities |  | (10,840) |  |  | — |
Payments to purchase common stock |  | (10,400) |  |  | (9,060) |
Shares surrendered upon exercise and vesting of equity awards to cover taxes |  | (2,310) |  |  | (970) |
Dividends paid |  | (1,660) |  |  | (1,740) |
Other financing activities |  | (2,950) |  |  | — |
Net cash used for financing activities |  | (17,320) |  |  | (11,770) |
Cash and Cash Equivalents: |  |  |  |
Decrease for the period |  | (60,200) |  |  | (81,920) |
At beginning of period |  | 112,090 |  |  | 140,740 |
At end of period |  | $ | 51,890 |  |  | $ | 58,820 |
Supplemental disclosure of cash flow information: |  |  |  |
Cash paid for interest |  | $ | 210 |  |  | $ | 310 |
Cash paid for taxes |  | $ | 1,780 |  |  | $ | 620 |

The accompanying notes are an integral part of these consolidated financial statements.
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TriMas Corporation
Consolidated Statement of Shareholders' Equity
Three Months Ended March 31, 2023 and 2022
(Unaudited—dollars in thousands)

|  | Common Stock |  | Paid-in Capital |  | Accumulated Deficit |  | Accumulated Other Comprehensive Income (Loss) |  | Total
Balances, December 31, 2022 |  | $ | 420 |  |  | $ | 696,160 |  |  | $ | (36,130) |  |  | $ | (8,620) |  |  | $ | 651,830 |
Net income |  | — |  |  | — |  |  | 4,910 |  |  | — |  |  | 4,910 |
Other comprehensive income |  | — |  |  | — |  |  | — |  |  | 3,450 |  |  | 3,450 |
Purchase of common stock |  | — |  |  | (10,400) |  |  | — |  |  | — |  |  | (10,400) |
Shares surrendered upon exercise and vesting of equity awards to cover taxes |  | — |  |  | (2,310) |  |  | — |  |  | — |  |  | (2,310) |
Non-cash compensation expense |  | — |  |  | 2,940 |  |  | — |  |  | — |  |  | 2,940 |
Dividends declared |  | — |  |  | (1,660) |  |  | — |  |  | — |  |  | (1,660) |
Balances, March 31, 2023 |  | $ | 420 |  |  | $ | 684,730 |  |  | $ | (31,220) |  |  | $ | (5,170) |  |  | $ | 648,760 |

|  | Common Stock |  | Paid-in Capital |  | Accumulated Deficit |  | Accumulated Other Comprehensive Income (Loss) |  | Total
Balances, December 31, 2021 |  | $ | 430 |  |  | $ | 732,490 |  |  | $ | (102,300) |  |  | $ | 230 |  |  | $ | 630,850 |
Net income |  | — |  |  | — |  |  | 14,170 |  |  | — |  |  | 14,170 |
Other comprehensive loss |  | — |  |  | — |  |  | — |  |  | (2,240) |  |  | (2,240) |
Purchase of common stock |  | — |  |  | (9,060) |  |  | — |  |  | — |  |  | (9,060) |
Shares surrendered upon exercise and vesting of equity awards to cover taxes |  | — |  |  | (970) |  |  | — |  |  | — |  |  | (970) |
Non-cash compensation expense |  | — |  |  | 2,820 |  |  | — |  |  | — |  |  | 2,820 |
Dividends declared |  | — |  |  | (1,740) |  |  | — |  |  | — |  |  | (1,740) |
Balances, March 31, 2022 |  | $ | 430 |  |  | $ | 723,540 |  |  | $ | (88,130) |  |  | $ | (2,010) |  |  | $ | 633,830 |

The accompanying notes are an integral part of these consolidated financial statements.
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TRIMAS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
1. Basis of Presentation
TriMas Corporation ("TriMas" or the "Company"), and its consolidated subsidiaries, designs, engineers and manufactures innovative products under leading brand names for customers primarily in the consumer products, aerospace & defense, and industrial markets.
The accompanying consolidated financial statements include the accounts of the Company and its subsidiaries and, in the opinion of management, contain all adjustments, including adjustments of a normal and recurring nature, necessary for a fair presentation of financial position and results of operations. The preparation of financial statements requires management of the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities. Actual results may differ from such estimates and assumptions due to risks and uncertainties, including uncertainty and volatility in the current economic environment due to input cost inflation, supply chain disruptions, and shortages in global markets for commodities, logistics and labor. To the extent there are differences between these estimates and actual results, the Company's consolidated financial statements may be materially affected.
Results of operations for interim periods are not necessarily indicative of results for the full year. The accompanying consolidated financial statements and notes thereto should be read in conjunction with the Company's 2022 Annual Report on Form 10-K.
2. Revenue
The following table presents the Company’s disaggregated net sales by primary market served (dollars in thousands):

|  |  |  | Three months ended March 31,
Customer Markets |  |  |  |  |  | 2023 |  | 2022
Consumer Products |  |  |  |  |  | $ | 95,290 |  |  | $ | 107,560 |
Aerospace & Defense |  |  |  |  |  | 49,990 |  |  | 44,520 |
Industrial |  |  |  |  |  | 70,180 |  |  | 72,230 |
Total net sales |  |  |  |  |  | $ | 215,460 |  |  | $ | 224,310 |

The Company’s Packaging segment earns revenues from the consumer products (comprised of the beauty and personal care, food and beverage, home care, pharmaceutical, nutraceutical and medical submarkets) and industrial markets. The Aerospace segment earns revenues from the aerospace & defense market (comprised of commercial, regional and business jet and military submarkets). The Specialty Products segment earns revenues from a variety of submarkets within the industrial market.
3. Realignment Actions
2022 Realignment Actions
During the three months ended March 31, 2022, the Company incurred realignment charges in its Packaging segment related to adjusting its labor force in facilities with lower demand, finalizing its Indianapolis, Indiana facility consolidation, costs incurred to reorganize its benefit plans in the United Kingdom, and for costs incurred as part of the Company's start-up and relocation to a new, larger facility in New Albany, Ohio. The Company also completed the Aerospace segment footprint realignment which began in 2021. In connection with these actions, the Company recorded pre-tax realignment charges of $2.3 million, of which $1.4 million were for employee-related costs and $0.9 million related to facility move and consolidation costs. For the three months ended March 31, 2022, $0.9 million and $1.4 million of these charges were included in cost of sales and selling, general and administrative expenses, respectively, in the accompanying consolidated statement of income.
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TRIMAS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
4. Acquisitions
2023 Acquisitions
On February 1, 2023, the Company acquired Aarts Packaging B.V. ("Aarts"), a luxury packaging solutions provider for beauty and lifestyle brands, as well as for customers in the food and life sciences end markets, for a purchase price of $37.8 million, net of cash acquired. The fair value of assets acquired and liabilities assumed included $20.4 million of goodwill, $10.9 million of intangible assets, $8.5 million of property and equipment, $7.4 million of net working capital, $3.9 million of net deferred tax liabilities and $5.5 million of other liabilities. Aarts, which is reported in the Company's Packaging segment, is located in Waalwijk, The Netherlands and historically generated €23 million in annual revenue.
2022 Acquisitions
On February 28, 2022, the Company acquired Intertech Plastics LLC and related companies (collectively, "Intertech") for a purchase price of $64.1 million, net of cash acquired. Intertech is a manufacturer of custom injection molded products used in medical applications, as well as products and assemblies for consumer and industrial applications. The fair value of assets acquired and liabilities assumed included $32.4 million of goodwill, $13.5 million of intangible assets, $12.2 million of property and equipment and $6.0 million of net working capital. Intertech, which is reported in the Company's Packaging segment, has two manufacturing facilities located in the Denver, Colorado area and historically generated $32 million in annual revenue.
5. Goodwill and Other Intangible Assets
Goodwill
Changes in the carrying amount of goodwill for the three months ended March 31, 2023 are summarized as follows (dollars in thousands):

| Packaging |  | Aerospace |  | Specialty Products |  | Total
Balance, December 31, 2022 | $ | 263,550 |  |  | $ | 69,700 |  |  | $ | 6,560 |  |  | $ | 339,810 |
Goodwill from acquisitions | 20,420 |  |  | — |  |  | — |  |  | 20,420 |
Foreign currency translation and other | 1,340 |  |  | 20 |  |  | — |  |  | 1,360 |
Balance, March 31, 2023 | $ | 285,310 |  |  | $ | 69,720 |  |  | $ | 6,560 |  |  | $ | 361,590 |

Other Intangible Assets
The Company amortizes its other intangible assets over periods ranging from one to 30 years. The gross carrying amounts and accumulated amortization of the Company's other intangibles are summarized below (dollars in thousands):

|  | As of March 31, 2023 |  | As of December 31, 2022
Intangible Category by Useful Life |  | Gross Carrying Amount |  | Accumulated Amortization |  | Gross Carrying Amount |  | Accumulated Amortization
Finite-lived intangible assets: |  |  |  |  |  |  |  |
Customer relationships, 5 – 12 years |  | $ | 140,720 |  |  | $ | (82,380) |  |  | $ | 131,660 |  |  | $ | (80,000) |
Customer relationships, 15 – 25 years |  | 129,670 |  |  | (75,930) |  |  | 129,650 |  |  | (74,380) |
Total customer relationships |  | 270,390 |  |  | (158,310) |  |  | 261,310 |  |  | (154,380) |
Technology and other, 1 – 15 years |  | 56,910 |  |  | (39,710) |  |  | 56,860 |  |  | (38,990) |
Technology and other, 17 – 30 years |  | 43,300 |  |  | (40,430) |  |  | 43,300 |  |  | (40,330) |
Total technology and other |  | 100,210 |  |  | (80,140) |  |  | 100,160 |  |  | (79,320) |
Indefinite-lived intangible assets: |  |  |  |  |  |  |  |
Trademark/Trade names |  | 62,690 |  |  | — |  |  | 60,340 |  |  | — |
Total other intangible assets |  | $ | 433,290 |  |  | $ | (238,450) |  |  | $ | 421,810 |  |  | $ | (233,700) |

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TRIMAS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
Amortization expense related to intangible assets as included in the accompanying consolidated statement of income is summarized as follows (dollars in thousands):

|  |  |  | Three months ended March 31,
|  |  |  |  |  | 2023 |  | 2022
Technology and other, included in cost of sales |  |  |  |  |  | $ | 810 |  |  | $ | 900 |
Customer relationships, included in selling, general and administrative expenses |  |  |  |  |  | 3,780 |  |  | 4,390 |
Total amortization expense |  |  |  |  |  | $ | 4,590 |  |  | $ | 5,290 |

6. Inventories
Inventories consist of the following components (dollars in thousands):

|  | March 31, 2023 |  | December 31, 2022
Finished goods |  | $ | 76,980 |  |  | $ | 74,280 |
Work in process |  | 40,990 |  |  | 38,090 |
Raw materials |  | 53,780 |  |  | 50,990 |
Total inventories |  | $ | 171,750 |  |  | $ | 163,360 |

7. Property and Equipment, Net
Property and equipment consists of the following components (dollars in thousands):

|  | March 31, 2023 |  | December 31, 2022
Land and land improvements |  | $ | 19,850 |  |  | $ | 15,220 |
Buildings |  | 96,030 |  |  | 90,910 |
Machinery and equipment |  | 478,720 |  |  | 461,480 |
|  | 594,600 |  |  | 567,610 |
Less: Accumulated depreciation |  | 299,380 |  |  | 289,860 |
Property and equipment, net |  | $ | 295,220 |  |  | $ | 277,750 |

Depreciation expense as included in the accompanying consolidated statement of income is as follows (dollars in thousands):

|  |  |  | Three months ended March 31,
|  |  |  |  |  | 2023 |  | 2022
Depreciation expense, included in cost of sales |  |  |  |  |  | $ | 8,560 |  |  | $ | 8,170 |
Depreciation expense, included in selling, general and administrative expenses |  |  |  |  |  | 200 |  |  | 300 |
Total depreciation expense |  |  |  |  |  | $ | 8,760 |  |  | $ | 8,470 |

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TRIMAS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
8. Long-term Debt
The Company's long-term debt consists of the following (dollars in thousands):

|  | March 31, 2023 |  | December 31, 2022
4.125% Senior Notes due April 2029 |  | $ | 400,000 |  |  | $ | 400,000 |
Debt issuance costs |  | (5,040) |  |  | (5,270) |
Long-term debt, net |  | $ | 394,960 |  |  | $ | 394,730 |

Senior Notes
In March 2021, the Company issued $400.0 million aggregate principal amount of 4.125% senior notes due April 15, 2029 ("Senior Notes") at par value in a private placement under Rule 144A of the Securities Act of 1933, as amended ("Securities Act"). The Senior Notes accrue interest at a rate of 4.125% per annum, payable semi-annually in arrears on April 15 and October 15. The payment of principal and interest is jointly and severally guaranteed, on a senior unsecured basis, by certain subsidiaries of the Company. The Senior Notes are pari passu in right of payment with all existing and future senior indebtedness and effectively subordinated to all existing and future secured indebtedness to the extent of the value of the assets securing such indebtedness.
Prior to April 15, 2024, the Company may redeem up to 40% of the principal amount of the Senior Notes at a redemption price of 104.125% of the principal amount, plus accrued and unpaid interest, if any, to the redemption date, with the net cash proceeds of one or more equity offerings provided that each such redemption occurs within 90 days of the date of closing of each such equity offering. In addition, prior to April 15, 2024, the Company may redeem all or part of the Senior Notes at a redemption price equal to 100% of the principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date, plus a "make whole" premium. On or after April 15, 2024, the Company may redeem all or part of the Senior Notes at the redemption prices (expressed as percentages of principal amount) set forth below, plus accrued and unpaid interest, if any, to the redemption date, if redeemed during the twelve-month period beginning on April 15 of the years indicated below:

Year |  | Percentage
2024 |  | 102.063 | %
2025 |  | 101.031 | %
2026 and thereafter |  | 100.000 | %

Credit Agreement
The Company is a party to a credit agreement ("Credit Agreement") consisting of a $300.0 million senior secured revolving credit facility, which permits borrowings denominated in specific foreign currencies, subject to a $125.0 million sub limit, maturing on March 29, 2026. The Credit Agreement is subject to benchmark interest rates determined based on the currency denomination of borrowings, with British pound sterling borrowings subject to the Sterling Overnight Index Average ("SONIA") and Euro borrowings to the Euro InterBank Offered Rate (“EURIBOR”), both plus a spread of 1.625%, and U.S. dollar borrowings subject to the Secured Overnight Financing Rate ("SOFR") plus a spread of 1.725%. The interest rate spread is based upon the leverage ratio, as defined, as of the most recent determination date. The Company's revolving credit facility allows for the issuance of letters of credit, not to exceed $40.0 million in aggregate.
The Credit Agreement also provides incremental revolving credit facility commitments in an amount not to exceed the greater of $200.0 million and an amount such that, after giving effect to such incremental commitments and the incurrence of any other indebtedness substantially simultaneously with the making of such commitments, the senior secured net leverage ratio, as defined, is no greater than 3.00 to 1.00. The terms and conditions of any incremental revolving credit facility commitments must be no more favorable than the existing credit facility.
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TRIMAS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
At March 31, 2023 and December 31, 2022, the Company had no amounts outstanding under its revolving credit facility and had $293.9 million potentially available after giving effect to $6.1 million of letters of credit issued and outstanding. After consideration of leverage restrictions contained in the Credit Agreement, as of March 31, 2023, the Company had $246.8 million of borrowing capacity available for general corporate purposes. The Company's borrowing capacity was not reduced by leverage restrictions contained in the Credit Agreement as of December 31, 2022.
The debt under the Credit Agreement is an obligation of the Company and certain of its domestic subsidiaries and is secured by substantially all of the assets of such parties. Borrowings under the $125.0 million (equivalent) foreign currency sub limit of the $300.0 million senior secured revolving credit facility are secured by a cross-guarantee amongst, and a pledge of the assets of, the foreign subsidiary borrowers that are a party to the agreement. The Credit Agreement also contains various negative and affirmative covenants and other requirements affecting the Company and its subsidiaries, including the ability, subject to certain exceptions and limitations, to incur debt, liens, mergers, investments, loans, advances, guarantee obligations, acquisitions, assets dispositions, sale-leaseback transactions, hedging agreements, dividends and other restricted payments, transactions with affiliates, restrictive agreements and amendments to charters, bylaws, and other material documents. The terms of the Credit Agreement also require the Company and its restricted subsidiaries to meet certain restrictive financial covenants and ratios computed quarterly, including a maximum total net leverage ratio (total consolidated indebtedness plus outstanding amounts under the accounts receivable securitization facility, less the aggregate amount of certain unrestricted cash and unrestricted permitted investments, as defined, over consolidated EBITDA, as defined), a maximum senior secured net leverage ratio (total consolidated senior secured indebtedness, less the aggregate amount of certain unrestricted cash and unrestricted permitted investments, as defined, over consolidated EBITDA, as defined) and a minimum interest expense coverage ratio (consolidated EBITDA, as defined, over the sum of consolidated cash interest expense, as defined, and preferred dividends, as defined). At March 31, 2023, the Company was in compliance with its financial covenants contained in the Credit Agreement.
Other Revolving Loan Facility
In May 2021, the Company, through one of its non-U.S. subsidiaries, entered into a revolving loan facility with a borrowing capacity of $4 million. The facility is guaranteed by TriMas Corporation. There were no borrowings outstanding on this loan facility as of March 31, 2023 and December 31, 2022.
Fair Value of Debt
The valuations of the Senior Notes and revolving credit facility were determined based on Level 2 inputs under the fair value hierarchy, as defined. The carrying amounts and fair values were as follows (dollars in thousands):

|  | March 31, 2023 |  | December 31, 2022
|  | Carrying Amount |  | Fair Value |  | Carrying Amount |  | Fair Value
4.125% Senior Notes due April 2029 |  | $ | 400,000 |  |  | $ | 353,000 |  |  | $ | 400,000 |  |  | $ | 344,000 |

9. Derivative Instruments
Derivatives Designated as Hedging Instruments
In July 2022, the Company entered into cross-currency swap agreements to hedge its net investment in Euro-denominated assets against future volatility in the exchange rate between the U.S. dollar and the Euro. By doing so, the Company synthetically converts a portion of its U.S. dollar-based long-term debt into Euro-denominated long-term debt. The agreements have notional amounts totaling $150.0 million, which decline to $75.0 million over contract periods ending on October 15, 2023 and April 15, 2024. Under the terms of the agreements, the Company is to receive net interest payments at fixed rates of approximately 2.4% to 2.6% of the notional amounts. At inception, the cross-currency swaps were designated as net investment hedges.
In July 2022, immediately prior to entering into the new cross-currency swap agreements, the Company terminated its existing cross-currency swap agreements, de-designating the swaps as net investment hedges and receiving $26.2 million of cash. The cross-currency swap agreements had notional amounts totaling $250.0 million, which declined to $25.0 million over various contract periods ending between October 15, 2023 and October 15, 2027. Under the terms of the agreements, the Company was to receive net interest payments at fixed rates ranging from approximately 0.8% to 2.9% of the notional amounts.
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TRIMAS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
As of March 31, 2023 and December 31, 2022, the fair value carrying amount of the Company's derivatives designated as hedging instruments are recorded as follows (dollars in thousands):

|  |  |  | Asset / (Liability) Derivatives
Derivatives designated as hedging instruments |  | Balance Sheet Caption |  | March 31, 2023 |  | December 31, 2022
Net Investment Hedges |  |  |  |  |  |
Cross-currency swaps |  | Other long-term liabilities |  | (9,590) |  |  | (7,090) |

The following table summarizes the income recognized in accumulated other comprehensive income (loss) ("AOCI") on derivative contracts designated as hedging instruments as of March 31, 2023 and December 31, 2022, and the amounts reclassified from AOCI into earnings for the three and three months ended March 31, 2023 and 2022 (dollars in thousands):

| Amount of Income Recognized in AOCI on Derivatives (Effective Portion, net of tax) |  |  |  | Amount of Income (Loss) Reclassified from AOCI into Earnings |  |  |  |
|  |  |  | Three months ended March 31, |  |
| As of March 31, 2023 |  | As of December 31, 2022 |  | Location of Income Reclassified from AOCI into Earnings (Effective Portion) |  | 2023 |  | 2022 |  |  |  |
Net Investment Hedges |  |  |  |  |  |  |  |  |  |  |  |  |
Cross-currency swaps | $ | 13,460 |  |  | $ | 15,320 |  |  | Other income (expense), net |  | $ | — |  |  | $ | — |  |  |  |  |

Over the next 12 months, the Company does not expect to reclassify any pre-tax deferred amounts from AOCI into earnings.
Derivatives Not Designated as Hedging Instruments
As of March 31, 2023, the Company was party to foreign currency exchange forward contracts to economically hedge changes in foreign currency rates with notional amounts of $185.7 million. The Company uses foreign exchange contracts to mitigate the risk associated with fluctuations in currency rates impacting cash flows related to certain of its receivables, payables and intercompany transactions denominated in foreign currencies. The foreign exchange contracts primarily mitigate currency exposures between the U.S. dollar and the Euro, Canadian dollar, Chinese yuan, and the Mexican peso, as well as between the Euro and British pound, and have various settlement dates through September 2023. These contracts are not designated as hedge instruments; therefore, gains and losses on these contracts are recognized each period directly into the consolidated statement of income.
The following table summarizes the effects of derivatives not designated as hedging instruments on the Company's consolidated statement of income (dollars in thousands):

|  |  |  | Amount of Income (Loss) Recognized in Earnings on Derivatives |  |  |  |
|  |  |  | Three months ended March 31, |  |
|  | Location of Income (Loss) Recognized in Earnings on Derivatives |  | 2023 |  | 2022 |  |  |  |
Derivatives not designated as hedging instruments |  |  |  |  |  |  |  |  |  |
Foreign exchange contracts |  | Other income (expense), net |  | $ | (760) |  |  | $ | 810 |  |  |  |  |

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TRIMAS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
Fair Value of Derivatives
The fair value of the Company's derivatives are estimated using an income approach based on valuation techniques to convert future amounts to a single, discounted amount. Estimates of the fair value of the Company's cross-currency swaps and foreign exchange contracts use observable inputs such as interest rate yield curves and forward currency exchange rates. Fair value measurements and the fair value hierarchy level for the Company's assets and liabilities measured at fair value on a recurring basis as of March 31, 2023 and December 31, 2022 are shown below (dollars in thousands):

Description |  | Frequency |  | Asset / (Liability) |  | Quoted Prices in Active Markets for Identical Assets (Level 1) |  | Significant Other Observable Inputs (Level 2) |  | Significant Unobservable Inputs (Level 3)
March 31, 2023 |  |  |  |  |  |  |  |  |  |
Cross-currency swaps |  | Recurring |  | $ | (9,590) |  |  | $ | — |  |  | $ | (9,590) |  |  | $ | — |
Foreign exchange contracts |  | Recurring |  | $ | (2,200) |  |  | $ | — |  |  | $ | (2,200) |  |  | $ | — |
December 31, 2022 |  |  |  |  |  |  |  |  |  |
Cross-currency swaps |  | Recurring |  | $ | (7,090) |  |  | $ | — |  |  | $ | (7,090) |  |  | $ | — |
Foreign exchange contracts |  | Recurring |  | $ | (1,790) |  |  | $ | — |  |  | $ | (1,790) |  |  | $ | — |

10. Leases
The majority of the Company's lease obligations are non-cancelable operating leases for certain equipment and facilities. The Company's finance leases are for certain equipment as part of the Company's acquisition of Aarts. Leases with an initial term of 12 months or less are not recorded on the balance sheet; expense related to these leases is recognized on a straight-line basis over the lease term.
Supplemental balance sheet information related to the Company's leases are shown below (dollars in thousands):

|  | Balance Sheet Location |  | March 31, 2023 |  | December 31, 2022
Assets |  |  |  |  |  |
Operating leases |  | Operating lease right-of-use assets |  | $ | 47,040 |  |  | $ | 47,280 |
Finance leases |  | Property and equipment, net (a) |  | 2,580 |  |  | — |
Total lease assets |  |  |  | $ | 49,620 |  |  | $ | 47,280 |
Liabilities |  |  |  |  |  |
Current: |  |  |  |  |  |
Operating leases |  | Lease liabilities, current portion |  | $ | 8,550 |  |  | $ | 8,280 |
Finance leases |  | Lease liabilities, current portion |  | 490 |  |  | — |
Long-term: |  |  |  |  |  |
Operating leases |  | Lease liabilities |  | 40,150 |  |  | 41,010 |
Finance leases |  | Lease liabilities |  | 2,040 |  |  | — |
Total lease liabilities |  |  |  | $ | 51,230 |  |  | $ | 49,290 |

__________________________
(a) Finance leases were recorded net of accumulated depreciation of $0.1 million as of March 31, 2023.
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TRIMAS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
The components of lease expense are as follows (dollars in thousands):

|  |  |  |  |  | Three months ended March 31, |
|  | Statement of Income Location |  |  |  |  |  | 2023 |  | 2022 |
Operating lease cost |  | Cost of sales and Selling, general and administrative expenses |  |  |  |  |  | $ | 2,580 |  |  | $ | 2,310 |  |
Finance lease cost: |  |  |  |  |  |  |  |  |  |  |
Depreciation of lease assets |  | Cost of sales |  |  |  |  |  | 40 |  |  | — |  |
Interest on lease liabilities |  | Interest expense |  |  |  |  |  | 10 |  |  | — |  |
Short-term, variable and other lease costs |  | Cost of sales and Selling, general and administrative expenses |  |  |  |  |  | 640 |  |  | 690 |  |
Total lease cost |  |  |  |  |  |  |  | $ | 3,270 |  |  | $ | 3,000 |  |

Maturities of lease liabilities are as follows (dollars in thousands):

Year ended December 31, |  | Operating Leases(a) |  | Finance Leases(a)
2023 (excluding the three months ended March 31, 2023) |  | $ | 7,830 |  |  | $ | 410 |
2024 |  | 9,610 |  |  | 530 |
2025 |  | 8,200 |  |  | 520 |
2026 |  | 7,920 |  |  | 600 |
2027 |  | 6,820 |  |  | 690 |
Thereafter |  | 14,830 |  |  | — |
Total lease payments |  | 55,210 |  |  | 2,750 |
Less: Imputed interest |  | (6,510) |  |  | (220) |
Present value of lease liabilities |  | $ | 48,700 |  |  | $ | 2,530 |

__________________________
(a) The maturity table excludes cash flows associated with exited lease facilities. Liabilities for exited lease facilities are included in accrued liabilities and other long-term liabilities in the accompanying consolidated balance sheet.
Other information related to the Company's leases are as follows (dollars in thousands):

|  |  |  | Three months ended March 31,
|  |  |  |  |  | 2023 |  | 2022
Cash paid for amounts included in the measurement of lease liabilities: |  |  |  |  |  |  |  |
Operating cash flows from operating leases |  |  |  |  |  | $ | 2,590 |  |  | $ | 2,270 |
Operating cash flows from finance leases |  |  |  |  |  | 10 |  |  | — |
Financing cash flows from finance leases |  |  |  |  |  | 80 |  |  | — |
Lease assets obtained in exchange for new lease liabilities: |  |  |  |  |  |  |  |
Operating leases |  |  |  |  |  | 4,780 |  |  | 4,750 |
Finance leases |  |  |  |  |  | 2,620 |  |  | — |

The weighted-average remaining lease term of the Company's operating leases and finance leases as of March 31, 2023 is 6.6 years and 4.3 years, respectively. The weighted-average discount rate for the operating leases and finance leases as of March 31, 2023 is 3.9% and 2.6%, respectively.
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TRIMAS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
11. Other long-term liabilities
Other long-term liabilities consist of the following components (dollars in thousands):

|  | March 31, 2023 |  | December 31, 2022
Non-current asbestos-related liabilities |  | $ | 25,870 |  |  | $ | 26,370 |
Other long-term liabilities |  | 32,770 |  |  | 29,970 |
Total other long-term liabilities |  | $ | 58,640 |  |  | $ | 56,340 |

12. Commitments and Contingencies
Asbestos
As of March 31, 2023, the Company was a party to 434 pending cases involving an aggregate of 4,817 claimants primarily alleging personal injury from exposure to asbestos containing materials formerly used in gaskets (both encapsulated and otherwise) manufactured or distributed by its former Lamons division and certain other related subsidiaries for use primarily in the petrochemical, refining and exploration industries. The following chart summarizes the number of claims, number of claims filed, number of claims dismissed, number of claims settled, the average settlement amount per claim and the total defense costs, at the applicable date and for the applicable periods:

|  | Claims pending at beginning of period |  | Claims filed during period |  | Claims dismissed during period |  | Claims settled during period |  | Claims pending at end of period |  | Average settlement amount per claim during period |  | Total defense costs during period
Three Months Ended March 31, 2023 |  | 4,798 |  |  | 71 |  |  | 43 |  |  | 9 |  |  | 4,817 |  |  | $ | 27,500 |  |  | $ | 420,000 |
Fiscal Year Ended December 31, 2022 |  | 4,754 |  |  | 236 |  |  | 168 |  |  | 24 |  |  | 4,798 |  |  | $ | 79,869 |  |  | $ | 2,180,000 |

In addition, the Company acquired various companies to distribute its products that had distributed gaskets of other manufacturers prior to acquisition. The Company believes that many of its pending cases relate to locations at which none of its gaskets were distributed or used.
The Company may be subjected to significant additional asbestos-related claims in the future, and will aggressively defend or reasonably resolve, as appropriate. The cost of settling cases in which product identification can be made may increase, and the Company may be subjected to further claims in respect of the former activities of its acquired gasket distributors. The cost of claims varies as claims may be initially made in some jurisdictions without specifying the amount sought or by simply stating the requisite or maximum permissible monetary relief, and may be amended to alter the amount sought. The large majority of claims do not specify the amount sought. Of the 4,817 claims pending at March 31, 2023, 40 set forth specific amounts of damages (other than those stating the statutory minimum or maximum). At March 31, 2023, of the 40 claims that set forth specific amounts, there were zero claims seeking more than $5 million for punitive damages. Below is a breakdown of the compensatory damages sought for those claims seeking specific amounts:

|  |  |  | Compensatory |  |
Range of damages sought (dollars in millions) |  |  |  |  |  |  |  | $0.0 to $0.6 |  | $0.6 to $5.0 |  | $5.0+ |  |  |  |  |  |
Number of claims |  |  |  |  |  |  |  | — |  | 3 |  | 37 |  |  |  |  |  |

Relatively few claims have reached the discovery stage and even fewer claims have gone past the discovery stage. Total settlement costs (exclusive of defense costs) for all such cases, some of which were filed over 30 years ago, have been $12.7 million. All relief sought in the asbestos cases is monetary in nature. Based on the settlements made to date and the number of claims dismissed or withdrawn for lack of product identification, the Company believes that the relief sought (when specified) does not bear a reasonable relationship to its potential liability.
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TRIMAS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
The Company records a liability for asbestos-related claims, which includes both known and unknown claims, based on a study from the Company’s third-party actuary, the Company's review of the study, as well as the Company’s own review of asbestos claims and claim resolution activity.
In the fourth quarter of 2022, the Company commissioned its actuary to update the study, based on data as of September 30, 2022, which yielded a range of possible future liability of $29.6 million to $39.5 million. The Company did not believe any amount within the range of potential outcomes represented a better estimate than another given the many factors and assumptions inherent in the projections, and therefore recorded a non-cash, pre-tax charge of $5.6 million to increase the liability estimate to $29.6 million, at the low-end of the range. As of March 31, 2023, the Company’s total asbestos-related liability is $28.6 million, and is included in accrued liabilities and other long-term liabilities, respectively, in the accompanying consolidated balance sheet.
The Company’s primary insurance, which covered approximately 40% of historical costs related to settlement and defense of asbestos litigation, expired in November 2018, upon which the Company became solely responsible for defense costs and indemnity payments. The Company is party to a coverage-in-place agreement (entered into in 2006) with its first level excess carriers regarding the coverage to be provided to the Company for asbestos-related claims. The coverage-in-place agreement makes asbestos defense costs and indemnity insurance coverage available to the Company that might otherwise be disputed by the carriers and provides a methodology for the administration of such expenses. The Company will continue to be solely responsible for defense costs and indemnity payments prior to the commencement of coverage under this agreement, the duration of which would be subject to the scope of damage awards and settlements paid. Based upon the Company’s review of the actuarial study, the Company does not believe it is probable that it will reach the threshold of qualified future settlements required to commence excess carrier insurance coverage under the coverage-in-place agreement.
Based upon the Company's experience to date, including the trend in annual defense and settlement costs incurred to date, and other available information (including the availability of excess insurance), the Company does not believe these cases will have a material adverse effect on its financial position, results of operations, or cash flows.
Claims and Litigation
The Company is subject to other claims and litigation in the ordinary course of business, but does not believe that any such claim or litigation will have a material adverse effect on its financial position and results of operations or cash flows.
13. Segment Information
TriMas reports its operations in three segments: Packaging, Aerospace, and Specialty Products. Each of these segments has discrete financial information that is regularly evaluated by TriMas' president and chief executive officer (chief operating decision maker) in determining resource, personnel and capital allocation, as well as assessing strategy and performance. The Company utilizes its proprietary TriMas Business Model as its platform which is based upon a standardized set of processes to manage and drive results and strategy across its multi-industry businesses.
Within each of the Company's reportable segments, there are no individual products or product families for which reported net sales accounted for more than 10% of the Company's consolidated net sales. See below for more information regarding the types of products and services provided within each reportable segment:
Packaging – TriMas' Packaging segment consists primarily of the Rieke®, Affaba & Ferrari™, Taplast™, Rapak®, Plastic Srl, Aarts Packaging, Intertech and Omega brands. TriMas Packaging develops and manufactures a broad array of dispensing products (such as foaming pumps, lotion and hand soaps and sanitizer pumps, beverage dispensers, perfume sprayers, nasal sprayers and trigger sprayers), polymeric and steel caps and closures (such as food lids, flip-top closures, child resistance caps, beverage closures, fragrance and cosmetic caps, drum and pail closures, and flexible spouts), polymeric jar products, fully integrated dispensers for fill-ready bag-in-box applications, and consumable vascular delivery and diagnostic test components, all for a variety of consumer products submarkets including, but not limited to, beauty and personal care, food and beverage, home care, and life sciences, including but not limited to pharmaceutical, nutraceutical, and medical, as well as industrial markets (including agricultural).
Aerospace – TriMas' Aerospace segment, which includes the Monogram Aerospace Fasteners™, Allfast Fastening Systems®, Mac Fasteners™, TFI Aerospace, RSA Engineered Products and Martinic Engineering brands, develops, qualifies and manufactures highly-engineered, precision fasteners, tubular products and assemblies for fluid conveyance, and machined products and assemblies to serve the aerospace and defense market.
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TRIMAS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
Specialty Products – TriMas' Specialty Products segment, which includes the Norris Cylinder™ and Arrow® Engine brands, designs, manufactures and distributes highly-engineered steel cylinders, wellhead engines and compression systems for use within industrial markets.
Segment activity is as follows (dollars in thousands):

|  |  |  | Three months ended March 31,
|  |  |  |  |  | 2023 |  | 2022
Net Sales |  |  |  |  |  |  |  |
Packaging |  |  |  |  |  | $ | 116,220 |  |  | $ | 138,490 |
Aerospace |  |  |  |  |  | 49,990 |  |  | 44,520 |
Specialty Products |  |  |  |  |  | 49,250 |  |  | 41,300 |
Total |  |  |  |  |  | $ | 215,460 |  |  | $ | 224,310 |
Operating Profit (Loss) |  |  |  |  |  |  |  |
Packaging |  |  |  |  |  | $ | 14,390 |  |  | $ | 21,330 |
Aerospace |  |  |  |  |  | 1,430 |  |  | 1,840 |
Specialty Products |  |  |  |  |  | 9,750 |  |  | 7,240 |
Corporate |  |  |  |  |  | (15,580) |  |  | (8,480) |
Total |  |  |  |  |  | $ | 9,990 |  |  | $ | 21,930 |

14. Equity Awards
Restricted Stock Units
The Company awarded the following restricted stock units ("RSUs") during the three months ended March 31, 2023:
•granted 250,625 RSUs to certain employees, which are subject only to a service condition and vest ratably over three years so long as the employee remains with the Company;
•granted 27,560 RSUs to its non-employee independent directors, which fully vest one year from date of grant so long as the director and/or Company does not terminate the director's service prior to the vesting date; and
•issued 31 RSUs to certain employees related to dividend equivalent rights on existing equity awards.
During 2023, the Company also awarded 95,017 performance-based RSUs to certain Company key employees which vest three years from the grant date as long as the employee remains with the Company. These awards are initially earned 50% based upon the Company's achievement of an earnings per share compound annual growth rate ("EPS CAGR") metric and 50% based upon the Company's cash return on net assets ("Cash RONA") metric over a period beginning January 1, 2023 and ending December 31, 2025. The total EPS CAGR and Cash RONA performance-based RSUs initially earned shall be subject to modification based on the Company's total shareholder return ("TSR") relative to the TSR of the common stock of a pre-defined industry peer-group, measured over the performance period. TSR is calculated as the Company's average closing stock price for the 20 trading days at the end of the performance period plus Company dividends, divided by the Company's average closing stock price for the 20 trading days prior to the start of the performance period. The Company estimates the grant-date fair value subject to a market condition using a Monte Carlo simulation model, using the following weighted average assumptions: risk-free rate of 4.36% and annualized volatility of 33.9%. Depending on the performance achieved for these two metrics, the amount of shares earned, if any, can vary for each metric from 0% of the target award to a maximum of 250% of the target.
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TRIMAS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
During 2020, the Company awarded performance-based RSUs to certain Company key employees which were earned 50% based upon the Company's achievement of earnings per share compound annual growth rate metric over a period beginning January 1, 2020 and ending December 31, 2022. The remaining 50% of the awards were earned based on the Company's total shareholder return relative to the TSR of the common stock of a pre-defined industry peer-group, measured over the performance period. The Company attained 62.7% of the target on a weighted average basis, resulting in a decrease of 32,430 shares during the three months ended March 31, 2023.
During 2020, the Company awarded performance-based RSUs to certain Company key employees which were earned based upon the Company's stock price performance over the period beginning January 1, 2020 and ending December 31, 2022. The stock price achievement was calculated based on the Company's average closing stock price for each quarter end for the 20 trading days up to and including March 31, June 30, September 30 and December 31, 2022, respectively. The Company did not meet the minimum performance threshold resulting in a decrease of 86,275 shares during the three months ended March 31, 2023.
Information related to RSUs at March 31, 2023 is as follows:

|  | Number of Unvested RSUs |  | Weighted Average Grant Date Fair Value |  | Average Remaining Contractual Life (Years) |  | Aggregate Intrinsic Value
Outstanding at January 1, 2023 |  | 719,449 |  |  | $ | 28.40 |  |  |  |  |
Granted |  | 373,233 |  |  | 29.62 |  |  |  |  |
Vested |  | (237,865) |  |  | 27.85 |  |  |  |  |
Cancelled |  | (137,661) |  |  | 18.33 |  |  |  |  |
Outstanding at March 31, 2023 |  | 717,156 |  |  | $ | 31.16 |  |  | 1.7 |  | $ | 19,979,966 |

As of March 31, 2023, there was $13.6 million of unrecognized compensation cost related to unvested RSUs that is expected to be recorded over a weighted average period of 1.8 years.
The Company recognized stock-based compensation expense related to RSUs of $2.9 million and $2.8 million during the three months ended March 31, 2023 and 2022, respectively. The stock-based compensation expense is included in selling, general and administrative expenses in the accompanying consolidated statement of income.
15. Earnings per Share
Net income is divided by the weighted average number of common shares outstanding during the period to calculate basic earnings per share. Diluted earnings per share is calculated to give effect to RSUs. The following table summarizes the dilutive effect of RSUs to purchase common stock for the three months ended March 31, 2023 and 2022:

|  |  |  | Three months ended March 31,
|  |  |  |  |  | 2023 |  | 2022
Weighted average common shares—basic |  |  |  |  |  | 41,543,625 |  |  | 42,799,206 |
Dilutive effect of restricted stock units |  |  |  |  |  | 258,412 |  |  | 310,487 |
Weighted average common shares—diluted |  |  |  |  |  | 41,802,037 |  |  | 43,109,693 |

In March 2020, the Company announced its Board of Directors had authorized the Company to increase the purchase of its common stock up to $250 million in the aggregate. This announcement represented the most recent update from the initial authorization, approved in November 2015, of up to $50 million of purchases in the aggregate of its common stock. In the three months ended March 31, 2023, the Company purchased 350,862 shares of its outstanding common stock for $10.4 million. During the three months ended March 31, 2022, the Company purchased 282,003 shares of its outstanding common stock for $9.1 million. As of March 31, 2023, the Company has $95.3 million remaining under the repurchase authorization.
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TRIMAS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
Holders of common stock are entitled to dividends at the discretion of the Company's Board of Directors. In 2021, the Company's Board of Directors declared the first dividend since the Company's initial public offering in 2007. During the three months ended March 31, 2023 and 2022, the Company's cash dividends declared were $0.04 per share of common stock and total dividends declared and paid on common shares were $1.7 million.
16. Defined Benefit Plans
Net periodic pension benefit costs for the Company's defined benefit pension plans cover certain foreign employees, union hourly employees and salaried employees. The components of net periodic pension cost (income) are as follows (dollars in thousands):

|  |  |  | Three months ended March 31,
|  |  |  |  |  | 2023 |  | 2022
Service costs |  |  |  |  |  | $ | 120 |  |  | $ | 200 |
Interest costs |  |  |  |  |  | 320 |  |  | 230 |
Expected return on plan assets |  |  |  |  |  | (530) |  |  | (410) |
Settlement/curtailment loss |  |  |  |  |  | — |  |  | 150 |
Amortization of net loss |  |  |  |  |  | 30 |  |  | 140 |
Net periodic benefit cost (income) |  |  |  |  |  | $ | (60) |  |  | $ | 310 |

The service cost component of net periodic benefit cost is recorded in cost of goods sold and selling, general and administrative expenses, while non-service cost components are recorded in other income (expense), net in the accompanying consolidated statement of income.
During the three months ended March 31, 2022, the Company recorded a non-cash curtailment expense of $0.2 million, as it transitioned certain active employees previously participating in a defined benefit plan in the United Kingdom to a defined contribution plan, thereby eliminating future service cost accruals for all employees under this defined benefit plan.
The Company contributed $0.3 million to its defined benefit pension plans during the three months ended March 31, 2023. The Company expects to contribute $1.2 million to its defined benefit pension plans for the full year 2023.
17. Other Comprehensive Income (Loss)
Changes in AOCI by component for the three months ended March 31, 2023 are summarized as follows, net of tax (dollars in thousands):

|  | Defined Benefit Plans |  | Derivative Instruments |  | Foreign Currency Translation |  | Total
Balance, December 31, 2022 |  | $ | (5,380) |  |  | $ | 15,320 |  |  | $ | (18,560) |  |  | $ | (8,620) |
Net unrealized gains (losses) arising during the period (a) |  | — |  |  | (1,860) |  |  | 5,290 |  |  | 3,430 |
Less: Net realized losses reclassified to net income |  | (20) |  |  | — |  |  | — |  |  | (20) |
Net current-period other comprehensive income (loss) |  | 20 |  |  | (1,860) |  |  | 5,290 |  |  | 3,450 |
Balance, March 31, 2023 |  | $ | (5,360) |  |  | $ | 13,460 |  |  | $ | (13,270) |  |  | $ | (5,170) |

__________________________
(a) Derivative instruments, net of income tax of $0.6 million. See Note 9, "Derivative Instruments," for further details.
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TRIMAS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
Changes in AOCI by component for the three months ended March 31, 2022 are summarized as follows, net of tax (dollars in thousands):

|  | Defined Benefit Plans |  | Derivative Instruments |  | Foreign Currency Translation |  | Total
Balance, December 31, 2021 |  | $ | (4,830) |  |  | $ | 5,910 |  |  | $ | (850) |  |  | $ | 230 |
Net unrealized gains (losses) arising during the period (a) |  | — |  |  | 1,560 |  |  | (4,040) |  |  | (2,480) |
Less: Net realized losses reclassified to net income (b) |  | (240) |  |  | — |  |  | — |  |  | (240) |
Net current-period other comprehensive income (loss) |  | 240 |  |  | 1,560 |  |  | (4,040) |  |  | (2,240) |
Balance, March 31, 2022 |  | $ | (4,590) |  |  | $ | 7,470 |  |  | $ | (4,890) |  |  | $ | (2,010) |

__________________________
(a) Derivative instruments, net of income tax of $0.5 million. See Note 9, "Derivative Instruments," for further details.
(b) Defined benefit plans, net of income tax of $0.1 million. See Note 16, "Defined Benefit Plans," for further details.
18. Subsequent Events
On April 20, 2023, the Company announced that its Board of Directors had declared a cash dividend of $0.04 per share of TriMas Corporation common stock, which will be payable on May 11, 2023 to shareholders of record as of the close of business on May 4, 2023.
On April 21, 2023, the Company acquired the operating net assets of Weldmac Manufacturing Company (“Weldmac”) for an initial purchase price of $35.7 million. The acquisition is subject to customary closing conditions, as well as additional contingent consideration of up to $10.0 million to be paid based on achievement of earnings targets, as defined in the purchase agreement. Weldmac is a leading designer and manufacturer of high-performance, complex metal fabricated components and assemblies for the aerospace, defense and space launch end markets with annual net sales of $33 million. Weldmac will become part of the Aerospace reportable segment.
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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis of our financial condition contains forward-looking statements regarding industry outlook and our expectations regarding the performance of our business. These forward-looking statements are subject to numerous risks and uncertainties, including, but not limited to, the risks and uncertainties described under the heading "Forward-Looking Statements," at the beginning of this report. Our actual results may differ materially from those contained in or implied by any forward-looking statements. You should read the following discussion together with the Company's reports on file with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2022.
Introduction
TriMas designs, develops and manufactures a diverse set of products primarily for the consumer products, aerospace & defense and industrial markets through its TriMas Packaging, TriMas Aerospace and Specialty Products groups. Our wide range of innovative products are designed and engineered to solve application-specific challenges that our customers face. We believe our businesses share important and distinguishing characteristics, including: well-recognized and leading brand names in the focused markets we serve; innovative product technologies and features; a high-degree of customer approved processes and qualifications; established distribution networks; relatively low ongoing capital investment requirements; strong cash flow conversion and long-term growth opportunities. While the majority of our revenue is in the United States, we manufacture and supply products globally to a wide range of companies. We report our business activity in three segments: Packaging, Aerospace and Specialty Products.
Key Factors Affecting Our Reported Results
Our businesses and results of operations depend upon general economic conditions. We serve customers in industries that are highly competitive, cyclical and that may be significantly impacted by changes in economic or geopolitical conditions.
Our results of operations have been materially impacted over the past few years by macro-economic factors, first by the onset and proliferation of the coronavirus ("COVID-19") pandemic, then further from increased energy costs and supply chain disruptions from the Russia-Ukraine conflict, and more recently by cost inflation (raw materials, wage rates and freight) and a lack of material availability. These factors s ignificantly affected each of our businesses and how we operate, albeit in different ways and magnitudes. Sales in our Packaging segment for dispensing and closure products used in applications to help fight the spread of germs have experienced extreme volatility in demand, with demand spiking to record highs after the onset of the pandemic, demand abating as expected from those high levels, and for the last three quarters demand abruptly falling as a result of some of our larger customers' choices to rebalance on-hand inventory levels given the current macro-economic environment. Sales of certain of our industrial and aerospace-related products were significantly depressed from historical levels following the onset of the pandemic, but demand has significantly increased in recent quarters, to where the industrial demand in our Specialty Products segment has rebounded to pre-pandemic levels, while demand in our Aerospace segment continues to increase (and more quickly than expected) as air travel has picked-up and new aircraft build rates improve. Altogether, this significant level of volatility in demand levels, input and transportation costs and material and labor availability have pressured our ability to operate efficiently and at historical margin levels.
Overall, our first quarter 2023 net sales decreased $8.9 million, or 3.9%, compared to first quarter 2022. We experienced sales growth from acquisitions in our Packaging segment as well as sales increases within our Specialty Products and Aerospace segments as a result of increased demand levels in Nort h America. We also believe that supply constraints, specifically the availability of certain specialized metallic raw materials, impacted our ability to capture additional sales in the quarter within TriMas Aerospace. These factors were more than offset by reduced demand for dispensers and closures used in consumer products and industrial applications within our Packaging segment, which we believe declined primarily due to initiatives by several of our larger customers to rebalance their inventory levels as well as a result of continued weaker consumer sentiment.
The most significant drivers affecting our financial results in first quarter 2023 compared with first quarter 2022, other than as directly impacted by sales changes, were the impact of our rec ent acquisitions and $3.9 million higher third party business diligence and consulting expenses in our corporate office in support of prospective streamlining actions and growth initiatives.
In February 2023, we acquired Aarts Packaging B.V. ("Aarts"), a luxury packaging solutions provider for beauty and lifestyle brands, as well as for customers in the food and life sciences end markets, for a purchase price of $37.8 million, net of cash acquired. Aarts, which is reported in the Company's Packaging segment, is located in Waalwijk, The Netherlands and contributed $4.3 million of net sales during first quarter 2023.
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Additional Key Risks that May Affect Our Reported Results
We have executed significant realignment actions over the past few years, primarily in our Aerospace and Specialty Products segments, and also in certain Packaging product areas where demand has fallen. We will continue to assess further actions if required. However, as a result of the current period of macroeconomic inflation and uncertainty, the impact of the COVID-19 pandemic, and the potential impact of such factors to our future results of operations, as well if there is an impact to TriMas' market capitalization, we may record additional cash and non-cash charges related to incremental realignment actions, asset impairments as well as for uncollectible customer account balances, excess inventory and idle production equipment.
Despite the potential for declines in future demand levels and results of operations, at present, we believe our capital structure is in a strong position. We have sufficient cash and available liquidity under our revolving credit facility to meet our debt service obligations, capital expenditure requirements and other short-term and long-term obligations for the foreseeable future.
Critical factors affecting our ability to succeed include: our ability to create organic growth through product development, cross-selling and extending product-line offerings, and our ability to quickly and cost-effectively introduce and successfully launch new products; our ability to acquire and integrate companies or products that supplement existing product lines, add new distribution channels or customers, expand our geographic coverage or enable better absorption of overhead costs; our ability to manage our cost structure more efficiently via supply chain management, internal sourcing and/or purchasing of materials, selective outsourcing and/or purchasing of support functions, working capital management, and greater leverage of our administrative functions; and our ability to absorb, or recover via commercial actions, inflationary or other cost increases.
Our overall business does not experience significant seasonal fluctuation, other than our fourth quarter, which has tended to be the lowest net sales quarter of the year due to holiday shutdowns at certain customers or other customers deferring capital spending to the following year. Given the short-cycle nature of most of our businesses, we do not consider sales order backlog to be a material factor. A growing amount of our sales is derived from international sources, which exposes us to certain risks, including currency risks.
We are sensitive to price movements and availability of our raw materials supply. Our largest raw material purchases are for resins (such as polypropylene and polyethylene), steel, aluminum and other oil and metal-based purchased components, the costs for each of which have been somewhat volatile over the past couple of years. There has been some volatility over the past two years as a direct and indirect result of foreign trade policy, where tariffs on certain of our commodity-based products sourced from Asia have been instituted, and certain North American suppliers have opportunistically increased their prices. We will continue to take actions to mitigate such increases, including implementing commercial pricing adjustments, resourcing to alternate suppliers and insourcing of previously sourced products to better leverage our global manufacturing footprint. Although we believe we are generally able to mitigate the impact of higher commodity costs over time, we may experience additional material costs and disruptions in supply in the future and may not be able to pass along higher costs to our customers in the form of price increases or otherwise mitigate the impacts to our operating results.
Although we have escalator/de-escalator clauses in commercial contracts with certain of our customers, or can modify prices based on market conditions to recover higher costs, our price increases generally lag the underlying material cost increase, and we cannot be assured of full cost recovery in the open market. If input costs increase at rapid rates, our ability to recover cost increases on a timely basis is made more difficult by the lag nature of these contracts.
Our Arrow Engine business in our Specialty Products segment is sensitive to the demand for natural gas and crude oil in North America. For example, demand for engine, pump jack and compressor products are impacted by active oil and gas rig counts and wellhead investment activities. Separately, oil-based commodity costs are a significant driver of raw materials and purchased components used within our Packaging segment.
Each year, as a core tenet of the TriMas Business Model, our businesses target cost savings from Kaizen and continuous improvement initiatives in an effort to reduce, or otherwise offset, the impact of increased input and conversion costs through increased throughput and yield rates, with a goal of at least covering inflationary and market cost increases. In addition, we continuously review our operating cost structures to ensure alignment with current market demand.
We continue to evaluate alternatives to redeploy the cash generated by our businesses, one of which includes returning capital to our shareholders. In 2020, our Board of Directors increased the authorization of share repurchases to a cumulative amount of $250 million. During first quarter 2023, we purchased 350,862 shares of our outstanding common stock for an aggregate purchase price of $10.4 million. As of March 31, 2023, we had $95.3 million remaining under the repurchase authorization.
In addition, in first quarter 2023, we declared dividends of $0.04 per share of common stock and paid dividends of $1.7 million. We will continue to evaluate opportunities to return capital to shareholders through the purchase of our common stock, as well as dividends, depending on market conditions and other factors.
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Segment Information and Supplemental Analysis
The following table summarizes financial information for our reportable segments for the three months ended March 31, 2023 and 2022 (dollars in thousands):

| Three months ended March 31,
| 2023 |  | As a Percentage of Net Sales |  | 2022 |  | As a Percentage of Net Sales
Net Sales |  |  |  |  |  |  |
Packaging | $ | 116,220 |  |  | 53.9 | % |  | $ | 138,490 |  |  | 61.8 | %
Aerospace | 49,990 |  |  | 23.2 | % |  | 44,520 |  |  | 19.8 | %
Specialty Products | 49,250 |  |  | 22.9 | % |  | 41,300 |  |  | 18.4 | %
Total | $ | 215,460 |  |  | 100.0 | % |  | $ | 224,310 |  |  | 100.0 | %
Gross Profit |  |  |  |  |  |  |
Packaging | $ | 27,240 |  |  | 23.4 | % |  | $ | 36,360 |  |  | 26.3 | %
Aerospace | 8,580 |  |  | 17.2 | % |  | 8,030 |  |  | 18.0 | %
Specialty Products | 11,870 |  |  | 24.1 | % |  | 9,320 |  |  | 22.6 | %
Total | $ | 47,690 |  |  | 22.1 | % |  | $ | 53,710 |  |  | 23.9 | %
Selling, General and Administrative Expenses |  |  |  |  |  |  |
Packaging | $ | 12,850 |  |  | 11.1 | % |  | $ | 15,030 |  |  | 10.9 | %
Aerospace | 7,150 |  |  | 14.3 | % |  | 6,190 |  |  | 13.9 | %
Specialty Products | 2,120 |  |  | 4.3 | % |  | 2,080 |  |  | 5.0 | %
Corporate | 15,580 |  |  | N/A |  | 8,480 |  |  | N/A
Total | $ | 37,700 |  |  | 17.5 | % |  | $ | 31,780 |  |  | 14.2 | %
Operating Profit (Loss) |  |  |  |  |  |  |
Packaging | $ | 14,390 |  |  | 12.4 | % |  | $ | 21,330 |  |  | 15.4 | %
Aerospace | 1,430 |  |  | 2.9 | % |  | 1,840 |  |  | 4.1 | %
Specialty Products | 9,750 |  |  | 19.8 | % |  | 7,240 |  |  | 17.5 | %
Corporate | (15,580) |  |  | N/A |  | (8,480) |  |  | N/A
Total | $ | 9,990 |  |  | 4.6 | % |  | $ | 21,930 |  |  | 9.8 | %
Depreciation |  |  |  |  |  |  |
Packaging | $ | 5,950 |  |  | 5.1 | % |  | $ | 5,540 |  |  | 4.0 | %
Aerospace | 1,860 |  |  | 3.7 | % |  | 1,900 |  |  | 4.3 | %
Specialty Products | 920 |  |  | 1.9 | % |  | 990 |  |  | 2.4 | %
Corporate | 30 |  |  | N/A |  | 40 |  |  | N/A
Total | $ | 8,760 |  |  | 4.1 | % |  | $ | 8,470 |  |  | 3.8 | %
Amortization |  |  |  |  |  |  |
Packaging | $ | 1,560 |  |  | 1.3 | % |  | $ | 2,170 |  |  | 1.6 | %
Aerospace | 2,910 |  |  | 5.8 | % |  | 3,010 |  |  | 6.8 | %
Specialty Products | 120 |  |  | 0.2 | % |  | 110 |  |  | 0.3 | %
Corporate | — |  |  | N/A |  | — |  |  | N/A
Total | $ | 4,590 |  |  | 2.1 | % |  | $ | 5,290 |  |  | 2.4 | %

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Results of Operations
The principal factors impacting us during the three months ended March 31, 2023, compared with the three months ended March 31, 2022, were:
•reductions in demand for products in certain end markets due to significant customer inventory rebalancing;
•the impact of recent acquisitions, primarily Intertech and Aarts;
•significant demand increases in our Aerospace and Specialty Products segments; and
•higher business diligence and consulting fees in support of our growth initiatives.
Three Months Ended March 31, 2023 Compared with Three Months Ended March 31, 2022
Overall, net sales decreased $8.9 million, or 3.9%, to $215.5 million for the three months ended March 31, 2023, as compared with $224.3 million in the three months ended March 31, 2022. Acquisition-related sales growth was $9.5 million, comprised of $5.2 million resulting from the January through February 2023 sales of our February 2022 acquisition of Intertech and $4.3 million from our February 2023 acquisition of Aarts. Organic sales, excluding t he impact of currency exchange and acquisitions, decreased $15.9 million, as increases in our Specialty Products and Aerospace segments driven by end market demand improvements were more than offset by decreases in the Packaging segment due to lower market demand, primarily as a result of several of our larger customers' choices to rebalance their inventory levels. In addition, net sales decreased by $2.6 million due to currency exchange, as our reported results in U.S. dollars were unfavorably impacted as a result of a strengthening U.S. dollar relative to foreign currencies.
Gross profit margin (gross profit as a percentage of sales) approximated 22.1% and 23.9% for the three months ended March 31, 2023 and 2022, respectively. Gross profit margin decreased due to lower sales and lower absorption of fixed costs within the Packaging segment, a less favorable product sales mix and inefficiencies driven by material availability delays within the Aerospace segment, partially offset by margin improvement within the Specialty Products segment due to higher sales leveraged across our existing fixed costs.
Operating profit margin (operating profit as a p ercentage of sales) approximated 4.6% and 9.8% for the three months ended March 31, 2023 and 2022, respectively. Operating profit decreased $11.9 million to $10.0 million in the three months ended March 31, 2023, from $21.9 million for the three months ended March 31, 2022, primarily due to lower sales levels and lower absorption of fixed costs within our Packaging segment, a less favorable product sales mix, inefficiencies resulting from material availability delays in our Aerospace segment, and higher selling, general and administrative expenses in our Aerospace segment, and an increase in professional fees, partially offset by higher sales levels and a favorable product sales mix within our Specialty Products segment.
Interest expense increased $0.3 million, to $3.7 million for the three months ended March 31, 2023, compared to $3.4 million for the three months ended March 31, 2022, due to a higher effective interest rate as a result of lower notional amounts of cross-currency swaps.
Other income (expense) decreased $0.2 million to $0.1 million of expense for the three months ended March 31, 2023, as compared to $0.3 million of expense for the three months ended March 31, 2022, primarily due to a decrease in losses on transactions denominated in foreign currencies.
The effective income tax rate for the three months ended March 31, 2023 and 2022 was 21.1% and 22.3%, respectively. We recorded income tax expense of $1.3 million and $4.1 million for the three months ended March 31, 2023 and 2022, respectively.
Net income decreased $9.3 million, to $4.9 million for the three months ended March 31, 2023, as compared to $14.2 million for the three months ended March 31, 2022. The decrease was primarily the result of a decrease in operating profit of $11.9 million and an increase in interest expense of $0.3 million, partially offset by a decrease in income tax expense of $2.8 million and a decrease in other expense of $0.2 million.
See below for a discussion of operating results by segment.
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Packaging. Net sales decreased $22.3 million, or 16.1%, to $116.2 million in the three months ended March 31, 2023, as compared to $138.5 million in the three months ended March 31, 2022. Acquisition-related sales growth was $9.5 million, comprised of $5.2 million resulting from the January through February 2023 sales of our February 2022 acquisition of Intertech and $4.3 million from our February 2023 acquisition of Aarts. Sales of products used in food and beverage markets decreased by $9.8 million, primarily due to lower demand for closures and dispensers. Sales of products used in industrial markets decreased by $9.8 million, primarily as a result of lower demand for drum closure products in North America. Sales of dispensing products used in beauty and personal care, as well as home care, applications decreased by $9.7 million. We believe that the decrease in sales in each of these categories reflects ongoing actions by many of our customers to work-down elevated inventory positions and closely manage their order activity given continuing uncertainty around consumer sentiment as a result of the inflationary environment. Net sales decreased by $2.5 million due to currency exchange, as our reported results in U.S. dollars were unfavorably impacted as a result of the strengthening U.S. dollar relative to foreign currencies, as compared to first quarter 2022.
Gross profit decreased $9.1 million to $27.2 million, or 23.4% of sales, in the three months ended March 31, 2023, as compared to $36.4 million, or 26.3% of sales, in the three months ended March 31, 2022, primarily due to lower sales and resulting lower absorption of fixed costs. Gross profit further declined in first quarter 2023 due to $0.8 million of unfavorable currency exchange, as our reported results in U.S. dollars were impacted as a result of the strengthening U.S. dollar relative to foreign currencies. The decrease in gross profit was partially offset by $1.2 million of lower energy costs compared with the spike in costs in first quarter 2022, primarily in the Europe-based operations.
Selling, general and administrative expenses decreased $2.2 million to $12.9 million, or 11.1% of sales, in the three months ended March 31, 2023, as compared to $15.0 million, or 10.9% of sales, in the three months ended March 31, 2022, primarily due to $1.3 million of employee-related costs associated with our realignment actions in first quarter of 2022, that did not repeat in first quarter of 2023. In addition, we incurred lower intangible asset amortization expense due to certain assets becoming fully amortized, as well as lowered overall spending levels in first quarter 2023, consistent with current lower demand levels. These decreases offset the higher ongoing selling, general and administrative costs associated with our acquisitions.
Operating profit decreased $6.9 million to $14.4 million, or 12.4% of sales, in the three months ended March 31, 2023, as compared to $21.3 million, or 15.4% of sales, in the three months ended March 31, 2022, as the impact of lower selling, general and administrative expenses and energy costs was more than offset by lower sales levels, lower absorption of fixed costs and the impact of $0.3 million of unfavorable currency exchange.
Aerospace. Net sales for the three months ended March 31, 2023 increased $5.5 million, or 12.3%, to $50.0 million, as compared to $44.5 million in the three months ended March 31, 2022. Sales of our fasteners products increased by $3.5 million due to increases in demand for fasteners used in new aircraft builds plus market share gains. Sales of our engineered components products increased by $2.0 million due to higher end market demand.
Gross profit increased $0.6 million to $8.6 million, or 17.2% of sales, in the three months ended March 31, 2023, from $8.0 million, or 18.0% of sales, in the three months ended March 31, 2022. Gross profit dollars increased primarily due to higher sales levels, while gross profit margin declined due to a less favorable product sales mix and inefficiencies driven by material availability constraints and delays.
Selling, general and administrative expenses increased $1.0 million to $7.2 million, or 14.3% of sales, in the three months ended March 31, 2023, as compared to $6.2 million, or 13.9% of sales, in the three months ended March 31, 2022, primarily due to higher employee-related costs in support of the increased sales levels.
Operating profit decreased $0.4 million to $1.4 million, or 2.9% of sales, in the three months ended March 31, 2023, as compared to $1.8 million, or 4.1% of sales, in the three months ended March 31, 2022, as the impact of higher sales was offset by a less favorable product sales mix, inefficiencies resulting from material availability delays, and higher selling, general and administrative expenses.
Specialty Products. Net sales for the three months ended March 31, 2023 increased $8.0 million, or 19.2%, to $49.3 million, as compared to $41.3 million in the three months ended March 31, 2022. Sales of our cylinder products increased $3.5 million due to higher demand for steel cylinders in North America. Sales of engines, compressors and related parts used in stationary power generation and assistance applications for natural gas and crude oil extraction increased by $4.5 million, primarily as a result of higher oil-field activity in North America.
Gross profit increased $2.6 million to $11.9 million, or 24.1% of sales, in the three months ended March 31, 2023, as compared to $9.3 million, or 22.6% of sales, in the three months ended March 31, 2022. Gross profit increased in the first quarter of 2023 primarily as a result of higher sales levels, while margin also improved due to leveraging the higher sales levels with the existing cost footprint.
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Selling, general and administrative expenses were flat at $2.1 million, or 4.3% of sales, in the three months ended March 31, 2023, as compared to $2.1 million, or 5.0% of sales, in the three months ended March 31, 2022, as the business leveraged the higher sales levels without need for incremental spending.
Operating profit increased $2.5 million to $9.8 million, or 19.8% of sales, in the three months ended March 31, 2023, as compared to $7.2 million, or 17.5% of sales, in the three months ended March 31, 2022, primarily due to higher sales levels.
Corporate. Corporate expenses consist of the following (dollars in millions):

|  | Three months ended March 31,
|  | 2023 |  | 2022
Corporate operating expenses |  | $ | 12.5 |  |  | $ | 5.5 |
Non-cash stock compensation |  | 2.9 |  |  | 2.8 |
Legacy expenses |  | 0.2 |  |  | 0.2 |
Corporate expenses |  | $ | 15.6 |  |  | $ | 8.5 |

Corporate expenses increased $7.1 million to $15.6 million for the three months ended March 31, 2023, from $8.5 million for the three months ended March 31, 2022, due to $3.9 million higher professional fees primarily for business diligence and consulting as well as $0.6 million increased incentive compensation expense in the three months ended March 31, 2023 as compared to the three months ended March 31, 2022, in addition to $1.5 million of costs now reported as corporate operating expenses related to centralizing certain of our information technology costs in the three months ended March 31, 2023.
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Liquidity and Capital Resources
Cash Flows
Cash flows provided by operating activities were $9.7 million for the three months ended March 31, 2023, as compared to $5.7 million for the three months ended March 31, 2022. Significant changes in cash flows provided by operating activities and the reasons for such changes were as follows:
•For the three months ended March 31, 2023, the Company generated $24.0 million in cash flows, based on the reported net income of $4.9 million and after considering the effects of non-cash items related to depreciation, amortization, (gain) loss on dispositions of assets, changes in deferred income taxes, stock-based compensation and other operating activities. For the three months ended March 31, 2022, the Company generated $34.8 million in cash flows based on the reported net income of $14.2 million and after considering the effects of similar non-cash items.
•Increases in accounts receivable resulted in a use of cash of $11.9 million and $22.3 million for the three months ended March 31, 2023 and 2022, respectively. The increased use of cash for each of the three month periods is due primarily to the timing of sales and collection of cash related thereto within the periods. Days sales outstanding of receivables increased by three days through the three months ended March 31, 2023, and increased by six days through the three months ended March 31, 2022.
•We increased our investment in inventory by $1.6 million and $0.9 million for the three months ended March 31, 2023 and 2022, respectively. Our days sales in inventory decreased by two days through the three months ended March 31, 2023, and decreased by three days through the three months ended March 31, 2022, as we continue to moderate inventory levels in line with sales levels.
•A decrease in prepaid expenses and other asse ts resulted in a source of cash of $1.5 million for the three months ended March 31, 2023, while an increase in prepaid expenses and other assets resulted in a use of cash of $0.7 million for the three months ended March 31, 2022. These changes were primarily a result of the timing of payments made for income taxes and certain operating expenses.
•Decreases in accounts payable and accrued liabilities resulted in a use of cash of $2.4 million and $5.2 million for the three months ended March 31, 2023 and 2022, respectively. Day s accounts payable on hand decreased by three days through the three months ended March 31, 2023 while remaining consistent through the three months ended March 31, 2022. Our days accounts payable on hand fluctuate primarily as a result of the timing of payments made to suppliers and the mix of vendors and related terms.
Net cash used for investing activities for the three months ended March 31, 2023 and 2022 was $52.6 million and $75.8 million, respectively. During the first three months of 2023, we invested $14.8 million in capital expenditures, as we continued our investment in growth, capacity and productivity-related capital projects, and paid $37.8 million, net of cash acquired, to acquire Aarts. During the first three months of 2022, we invested $11.9 million in capital expenditures and paid $64.0 million, net of cash acquired, to acquire Intertech.
Net cash used for financing activities for the three months ended March 31, 2023 and 2022 was $17.3 million and $11.8 million, respectively. During the three months ended March 31, 2023, we purchased $10.4 million of outstanding common stock, used a net cash amount of $2.3 million related to our stock compensation arrangements, paid dividends of $1.7 million and paid $3.0 million related to liabilities assumed in our acquisition of Aarts. During the three months ended March 31, 2022, we purchased $9.1 million of outstanding common stock, used a net cash amount of $1.0 million related to our stock compensation arrangements, and paid dividends of $1.7 million.
Our Debt and Other Commitments
In March 2021, we issued $400.0 million aggregate principal amount of 4.125% senior notes due April 15, 2029 ("Senior Notes") at par value in a private placement under Rule 144A of the Securities Act of 1933, as amended ("Securities Act"). The Senior Notes accrues interest at a rate of 4.125% per annum, payable semi-annually in arrears on April 15 and October 15. The payment of principal and interest is jointly and severally guaranteed, on a senior unsecured basis, by certain subsidiaries of the Company. The Senior Notes are pari passu in right of payment with all existing and future senior indebtedness and effectively subordinated to all existing and future secured indebtedness to the extent of the value of the assets securing such indebtedness.
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Prior to April 15, 2024, we may redeem up to 40% of the principal amount of the Senior Notes at a redemption price of 104.125% of the principal amount, plus accrued and unpaid interest, if any, to the redemption date, with the net cash proceeds of one or more equity offerings provided that each such redemption occurs within 90 days of the date of closing of each such equity offering. In addition, prior to April 15, 2024, we may redeem all or part of the Senior Notes at a redemption price equal to 100% of the principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date, plus a "make whole" premium.
For the three months ended March 31, 2023, our consolidated subsidiaries that do not guarantee the Senior Notes represented 29% of the total of guarantor and non-guarantor net sales, treating each as a consolidated group and excluding intercompany transactions between guarantor and non-guarantor subsidiaries. In addition, our non-guarantor subsidiaries represented 38% and 14% of the total guarantor and non-guarantor assets and liabilities, respectively, as of March 31, 2023, treating the guarantor and non-guarantor subsidiaries each as a consolidated group.
We are party to a credit agreement ("Credit Agreement") consisting of a $300.0 million senior secured revolving credit facility, which permits borrowings denominated in specific foreign currencies, subject to a $125.0 million sub limit, maturing on March 29, 2026. The Credit Agreement is subject to benchmark interest rates determined based on the currency denomination of borrowings, with British pound sterling borrowings subject to the Sterling Overnight Index Average ("SONIA") and Euro borrowings to the Euro InterBank Offered Rate (“EURIBOR”), both plus a spread of 1.625%, and U.S. dollar borrowings subject to the Secured Overnight Financing Rate ("SOFR") plus a spread of 1.725%. The interest rate spread is based upon the leverage ratio, as defined, as of the most recent determination date. Our revolving credit facility allows for the issuance of letters of credit, not to exceed $40.0 million in aggregate.
The Credit Agreement provides for incremental revolving credit commitments in an amount not to exceed the greater of $200.0 million and an amount such that, after giving effect to such incremental commitments and the incurrence of any other indebtedness substantially simultaneously with the making of such commitments, the senior secured net leverage ratio, as defined in the Credit Agreement, is no greater than 3.00 to 1.00. The terms and conditions of any incremental revolving credit facility commitments must be no more favorable than the existing credit facility.
Amounts drawn under our revolving credit facility fluctuate daily based upon our working capital and other ordinary course needs. Availability under our revolving credit facility depends upon, among other things, compliance with our Credit Agreement's financial covenants. Our Credit Agreement contains various negative and affirmative covenants and other requirements affecting us and our subsidiaries, including the ability to, subject to certain exceptions and limitations, incur debt, liens, mergers, investments, loans, advances, guarantee obligations, acquisitions, asset dispositions, sale-leaseback transactions, hedging agreements, dividends and other restricted payments, transactions with affiliates, restrictive agreements and amendments to charters, bylaws, and other material documents. The terms of our Credit Agreement require us and our subsidiaries to meet certain restrictive financial covenants and ratios computed quarterly, including a maximum total net leverage ratio (total consolidated indebtedness plus outstanding amounts under the accounts receivable securitization facility, less the aggregate amount of certain unrestricted cash and unrestricted permitted investments, as defined, over consolidated EBITDA, as defined) and a minimum interest expense coverage ratio (consolidated EBITDA, as defined, over the sum of consolidated cash interest expense, as defined, and preferred dividends, as defined). Our permitted total net leverage ratio under the Credit Agreement is 4.00 to 1.00 as of March 31, 2023. If we were to complete an acquisition which qualifies for a Covenant Holiday Period, as defined in our Credit Agreement, then our permitted total net leverage ratio cannot exceed 4.50 to 1.00 during that period. Our actual total net leverage ratio was 2.37 to 1.00 at March 31, 2023. Our permitted interest expense coverage ratio under the Credit Agreement is 3.00 to 1.00 as of March 31, 2023. Our actual interest expense coverage ratio was 11.97 to 1.00 at March 31, 2023. At March 31, 2023, we were in compliance with our financial covenants.
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The following is a reconciliation of net income, as reported, which is a GAAP measure of our operating results, to Consolidated Bank EBITDA, as defined in our Credit Agreement, for the twelve months ended March 31, 2023 (dollars in thousands). We present Consolidated Bank EBITDA to show our performance under our financial covenants.

|  |  |  |  |  |  |  | Twelve Months Ended March 31, 2023
Net income |  |  |  |  |  |  |  | $ | 56,910 |
Bank stipulated adjustments: |  |  |  |  |  |  |  |
Interest expense |  |  |  |  |  |  |  | 14,400 |
Income tax expense |  |  |  |  |  |  |  | 18,740 |
Depreciation and amortization |  |  |  |  |  |  |  | 52,810 |
Non-cash compensation expense(1) |  |  |  |  |  |  |  | 9,960 |
Other non-cash expenses or losses |  |  |  |  |  |  |  | 460 |
Non-recurring expenses or costs(2) |  |  |  |  |  |  |  | 11,740 |
Extraordinary, non-recurring or unusual gains or losses |  |  |  |  |  |  |  | 5,590 |
Effects of purchase accounting adjustments |  |  |  |  |  |  |  | 840 |
Business and asset dispositions |  |  |  |  |  |  |  | (21,970) |
Permitted acquisitions |  |  |  |  |  |  |  | 3,140 |
Currency gains and losses |  |  |  |  |  |  |  | (770) |
Consolidated Bank EBITDA, as defined |  |  |  |  |  |  |  | $ | 151,850 |

| March 31, 2023 |
Total Indebtedness, as defined(3) | $ | 360,640 |  |
Consolidated Bank EBITDA, as defined | 151,850 |  |
Total net leverage ratio | 2.37 |  | x
Covenant requirement | 4.00 |  | x

|  |  |  |  |  |  |  | Twelve Months Ended March 31, 2023
Interest expense |  |  |  |  |  |  |  | $ | 14,400 |
Bank stipulated adjustments: |  |  |  |  |  |  |  |
Interest income |  |  |  |  |  |  |  | (800) |
Non-cash amounts attributable to amortization of financing costs |  |  |  |  |  |  |  | (910) |
Total Consolidated Cash Interest Expense, as defined |  |  |  |  |  |  |  | $ | 12,690 |

| March 31, 2023 |
Consolidated Bank EBITDA, as defined | $ | 151,850 |  |
Total Consolidated Cash Interest Expense, as defined | 12,690 |  |
Actual interest expense coverage ratio | 11.97 |  | x
Covenant requirement | 3.00 |  | x

_____________________________
(1) Non-cash compensation expenses resulting from the grant of equity awards.
(2) Non-recurring costs and expenses relating to diligence and transaction costs, purchase accounting costs, severance, relocation, restructuring and curtailment expenses.
(3) Includes $2.5 million of finance leases as of March 31, 2023.
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At March 31, 2023 and December 31, 2022, we had no amounts outstanding under our revolving credit facility and had $293.9 million potentially available after giving effect to $6.1 million of letters of credit issued and outstanding. Our letters of credit are used for a variety of purposes, including support of certain operating lease agreements, vendor payment terms and other subsidiary operating activities, and to meet various states' requirements to self-insure workers' compensation claims, including incurred but not reported claims. After consideration of leverage restrictions contained in the Credit Agreement, as of March 31, 2023, we had $246.8 million of borrowing capacity available for general corporate purposes. Our borrowing capacity was not reduced by leverage restrictions contained in the Credit Agreement as of December 31, 2022.
We rely upon our cash flow from operations and available liquidity under our revolving credit facility to fund our debt service obligations and other contractual commitments, working capital and capital expenditure requirements. At the end of each quarter, we have historically used cash on hand from our domestic and foreign subsidiaries to pay down amounts outstanding under our revolving credit facility, as applicable.
Our weighted average borrowings during the first three months of 2023 approximated $403.0 million, compared to $400.0 million during the first three months of 2022, primarily due to borrowings made on our revolving credit facility.
In May 2021, we, through one of our non-U.S. subsidiaries, entered into a revolving loan facility with a borrowing capacity of $4 million. The facility is guaranteed by TriMas Corporation. There were no borrowings on this loan facility as of March 31, 2023.
Cash management related to our revolving credit facility is centralized. We monitor our cash position and available liquidity on a daily basis and forecast our cash needs on a weekly basis within the current quarter and on a monthly basis outside the current quarter over the remainder of the year. Our business and related cash forecasts are updated monthly.
While more than half of our cash on hand as of March 31, 2023 is located outside of the U.S., given available funding under our revolving credit facility of $246.8 million at March 31, 2023 (after consideration of the aforementioned leverage restrictions) and based on forecasted cash sources and requirements inherent in our business plans, we believe that our liquidity and capital resources, including anticipated cash flows from operations, will be sufficient to meet our debt service, capital expenditure and other short-term and long-term obligations for the foreseeable future, as well as dividends and share repurchases.
We are subject to variable interest rates on our revolving credit facility, which is subject to a benchmark interest rate determined based on the currency denomination of borrowings. At March 31, 2023, we had no amounts outstanding on our revolving credit facility and, therefore, no variable rate-based borrowings outstanding.
In addition to our long-term debt, we have other cash commitments related to leases. The majority of our lease transactions are accounted for as operating leases, and annual rent expense for continuing operations related thereto approximated $13.9 million in 2022. We expect leasing will continue to be an available financing option to fund future capital expenditure requirements.
As part of our first quarter 2023 acquisition of Aarts, we assumed a $2.9 million liability to a bank related to the advance funding of certain accounts receivable invoices. We terminated this arrangement, and repaid the outstanding balance, in March 2023.
In March 2020, we announced our Board of Directors had authorized us to increase the purchase of our common stock up to $250 million in the aggregate, an increase of $100 million from the prior authorization. In the three months ended March 31, 2023, we purchased 350,862 shares of our outstanding common stock for an aggregate purchase price of and $10.4 million, respectively. Since the initial authorization through March 31, 2023, we have purchased 5,465,765 shares of our outstanding common stock for an aggregate purchase price of $154.7 million. We will continue to evaluate opportunities to return capital to shareholders through the purchase of our common stock and the payment of dividends, depending on market conditions, including the potential impact of the COVID-19 pandemic, and other factors.
Market Risk
We conduct business in various locations throughout the world and are subject to market risk due to changes in the value of foreign currencies. The functional currencies of our foreign subsidiaries are primarily the local currency in the country of domicile. We manage these operating activities at the local level and revenues and costs are generally denominated in local currencies; however, results of operations and assets and liabilities reported in U.S. dollars will fluctuate with changes in exchange rates between such local currencies and the U.S. dollar.
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We use derivative financial instruments to manage currency risks associated with our procurement activities denominated in currencies other than the functional currency of our subsidiaries and the impact of currency rate volatility on our earnings. As of March 31, 2023, we were party to foreign exchange forward and swap contracts to hedge changes in foreign currency exchange rates with notional amounts of $185.7 million. We also use cross-currency swap agreements to mitigate currency risks associated with the net investment in certain of our foreign subsidiaries. See Note 9, "Derivative Instruments," included in Part 1, Item 1, "Notes to Unaudited Consolidated Financial Statements," within this quarterly report on Form 10-Q for additional information.
We are also subject to interest risk as it relates to our long-term debt. See Note 8, "Long-term Debt," included in Part 1, Item 1, "Notes to Unaudited Consolidated Financial Statements," within this quarterly report on Form 10-Q for additional information.
Common Stock
TriMas is listed in the NASDAQ Global Select Market. Our stock trades under the symbol "TRS."
Credit Rating
We and certain of our outstanding debt obligations are rated by Standard & Poor's and Moody's. On March 31, 2023, Moody's affirmed a Ba3 rating to our Senior Notes. See Note 8, "Long-term Debt" included in Part I, Item 1, "Notes to Unaudited Consolidated Financial Statements" within this quarterly report on Form 10-Q. Moody's also affirmed a Ba2 Corporate Family Rating and maintained its outlook as stable. On May 12, 2022, Standard & Poor's affirmed a BB- rating to our Senior Notes. Standard & Poor also affirmed a BB corporate credit rating and maintained its outlook as stable. If our credit ratings were to decline, our ability to access certain financial markets may become limited, our cost of borrowings may increase, the perception of us in the view of our customers, suppliers and security holders may worsen and as a result, we may be adversely affected.
Outlook
We expect that the current macro-economic and global market uncertainties will persist in 2023, making it a challenging environment to effectively and efficiently transact business in the end markets we serve. We continue to experience volatility in our customers' order patterns, inflationary pressures for certain input costs (raw materials and wage rates in particular), with supply chain disruptions limiting material availability for certain products, and with labor availability remaining at lower levels than prior to the pandemic. While our Specialty Products segment continues to grow to meet higher industrial demand, and is converting that demand at near record-level margins, the macro-economic impacts are more challenging in our Packaging segment, primarily due to significantly elevated inventory positions and uncertainty regarding future consumer sentiment in the current inflationary environment, all of which have reduced current demand levels, and in our Aerospace segment, which is experiencing strong order intake but is challenged with material constraints. No matter the outcome of these factors, we expect to continue to mitigate, as much as practical, the impact of these challenges, executing on streamlining actions and taking other steps as necessary, to maintain our strong balance sheet and generate cash in support of our capital allocation strategy.
We believe our capital structure remains strong and that we have sufficient headroom under our financial covenants, and ample cash and available liquidity under our revolving credit facility, to meet our debt service, capital expenditure and other short-term and long-term obligations for the next 12 months and for the foreseeable future, as well as fund dividends, share repurchases and bolt-on acquisitions consistent with our capital allocation strategy.
We expect to continue to leverage the tenets of our TriMas Business Model to manage our multi-industry businesses on a longer-term basis, to achieve our growth plans, execute continuous improvement initiatives to offset inflationary pressures, and seek lower-cost sources for input costs, all while continuously assessing the appropriateness of our manufacturing footprint and fixed-cost structure.
Impact of New Accounting Standards
There were no new accounting pronouncements issued or effective as of March 31, 2023 that are expected to have a material impact on our consolidated financial statements.
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Critical Accounting Policies
Certain of our accounting policies require the application of significant judgment by management in selecting the appropriate assumptions used in calculating financial estimates. By their nature, these judgments are subject to an inherent degree of uncertainty. These judgments are based on our historical experience, our evaluation of business and macroeconomic trends, and information from other outside sources, as appropriate.
During the quarter ended March 31, 2023, there were no material changes to the items that we disclosed as our critical accounting policies in Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations," in the Annual Report on Form 10-K for the year ended December 31, 2022.
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Item 3. Quantitative and Qualitative Disclosures About Market Risk
In the normal course of business, we are exposed to market risk associated with fluctuations in foreign currency exchange rates. We are also subject to interest risk as it relates to long-term debt. See Part I, Item 2, "Management's Discussion and Analysis of Financial Condition and Results of Operations," for details about our primary market risks, and the objectives and strategies used to manage these risks. Also see Note 8, "Long-term Debt," and Note 9, "Derivative Instruments," in Part I, Item 1, "Notes to Unaudited Consolidated Financial Statements," included within this quarterly report on Form 10-Q for additional information.
Item 4. Controls and Procedures
The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the reports that the Company files or submits under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), is recorded, processed, summarized, and reported within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to the Company's management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures.
Evaluation of disclosure controls and procedures
As of March 31, 2023, an evaluation was carried out by management, with the participation of the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the Company's disclosure controls and procedures (as such term is defined in Rule 13a-15(e) and Rule 15d-15(e) of the Exchange Act) pursuant to Rule 13a-15 of the Exchange Act. The Company's disclosure controls and procedures are designed only to provide reasonable assurance that they will meet their objectives. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that as of March 31, 2023, the Company's disclosure controls and procedures are effective to provide reasonable assurance that they would meet their objectives.
Changes in internal control over financial reporting
There have been no changes in the Company's internal control over financial reporting during the quarter ended March 31, 2023 that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.
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PART II. OTHER INFORMATION
TRIMAS CORPORATION
Item 1. Legal Proceedings
See Note 12, "Commitments and Contingencies," included in Part I, Item 1, "Notes to Unaudited Consolidated Financial Statements," within this quarterly report on Form 10-Q.
Item 1A. Risk Factors
In addition to the other information set forth in this report, you should carefully consider the factors discussed in Part 1, Item 1A., "Risk Factors," in our 2022 Annual Report on Form 10-K, which could materially affect our business, financial condition or future results. There have been no significant changes in our risk factors as disclosed in our 2022 Annual Report on Form 10-K.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
The following table provides information about purchases made by the Company, or on behalf of the Company by an affiliated purchaser, of shares of the Company's common stock during the three months ended March 31, 2023.

Period |  | Total Number of Shares Purchased |  | Average Price Paid per Share |  | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1) |  | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program (1)
January 1, 2023 to January 31, 2023 |  | 190,040 |  |  | $ | 29.39 |  |  | 190,040 |  |  | $ | 100,108,531 |
February 1, 2023 to February 28, 2023 |  | 105,405 |  |  | $ | 30.80 |  |  | 105,405 |  |  | $ | 96,861,569 |
March 1, 2023 to March 31, 2023 |  | 55,417 |  |  | $ | 28.38 |  |  | 55,417 |  |  | $ | 95,289,038 |
Total |  | 350,862 |  |  | $ | 29.66 |  |  | 350,862 |  |  | $ | 95,289,038 |

__________________________
(1) In March 2020, the Company announced its Board of Directors had authorized the Company to increase the purchase of its common stock up to $250 million in the aggregate from its previous authorization of $150 million. The increased authorization includes the value of shares already purchased under the previous authorization. Pursuant to this share repurchase program, during the three months ended March 31, 2023, the Company repurchased 350,862 shares of its common stock at a cost of $10.4 million. The share repurchase program is effective and has no expiration date.
Item 3. Defaults Upon Senior Securities
Not applicable.
Item 4. Mine Safety Disclosures
Not applicable.
Item 5. Other Information
Not applicable.
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Item 6. Exhibits
Exhibits Index:

3.1 | Fourth Amended and Restated Certificate of Incorporation of TriMas Corporation (Incorporated by reference to the Exhibits filed with TriMas Corporation's Quarterly Report on Form 10-Q filed on August 3, 2007 (File No. 001-10716)).
3.2 | Third Amended and Restated By-laws of TriMas Corporation (Incorporated by reference to the Exhibits filed with TriMas Corporation's Current Report on Form 8-K filed on December 18, 2015 (File No. 001-10716)).
10.1 | Form of Performance Stock Units Agreement - 2023 LTI - under the 2017 Equity and Incentive Compensation Plan.*
10.2 | Form of Restricted Stock Units Agreement (Three-Year Vest) - 2023 LTI - under the 2017 Equity and Incentive Compensation Plan.*
10.3 | Form of Restricted Stock Units Agreement (Board Of Directors) (One-Year Vest) - 2023 LTI - under the 2017 Equity and Incentive Compensation Plan.*
31.1 | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes‑Oxley Act of 2002.
31.2 | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes‑Oxley Act of 2002.
32.1 | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes‑Oxley Act of 2002.
32.2 | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes‑Oxley Act of 2002.
101 | The following materials from TriMas Corporation's Quarterly Report on Form 10-Q for the quarter ended March 31, 2023, formatted in Inline XBRL (eXtensible Business Reporting Language): (i) the Consolidated Balance Sheet, (ii) the Consolidated Statement of Income, (iii) the Consolidated Statement of Comprehensive Income, (iv) the Consolidated Statement of Cash Flows, (v) the Consolidated Statement of Shareholders' Equity, (vi) Notes to Consolidated Financial Statements, and (vii) document and entity information.
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document)

* Management contracts and compensatory plans or arrangements.
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Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

|  | TRIMAS CORPORATION (Registrant)
|  |  |  | /s/ SCOTT A. MELL
Date: | April 27, 2023 | By: |  | Scott A. Mell Chief Financial Officer

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