The Company reports its financial results in accordance with accounting principles generally accepted in the United States of America ("GAAP"). However, management believes that certain non-GAAP financial measures, used in managing the business, may provide users of this financial information with additional meaningful comparisons between current results and results in prior periods. Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, the Company's reported results prepared in accordance with GAAP. The following table provides the calculation of the non-GAAP financial measures discussed in the Company's press release dated August 3, 2021:
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| Three Months Ended | |||||
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| June 30, 2021 | June 30, 2020 | ||||
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|
| ||||
Net loss attributable to ATI | $ | (49.2) |
| $ | (422.6) |
|
Adjust for special items, net of tax: |
|
| ||||
Strike related costs (a) | 40.3 |
| — |
| ||
Impairment of goodwill (b) | — |
| 281.4 |
| ||
Restructuring and other charges (credits) (c) | (6.2) |
| 16.4 |
| ||
Joint venture restructuring charge (d) | — |
| 2.4 |
| ||
Debt extinguishment charge (e) | — |
| 21.1 |
| ||
Income tax valuation allowance (f) | — |
| 99.0 |
| ||
Net loss attributable to ATI excluding special items | $ | (15.1) |
| $ | (2.3) |
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| Per Diluted Share * | |||||
|
|
|
| ||||
Net loss attributable to ATI | $ | (0.39) |
| $ | (3.34) |
|
Adjust for special items, net of tax: |
|
| ||||
Strike related costs (a) | 0.32 |
| — |
| ||
Impairment of goodwill (b) | — |
| 2.22 |
| ||
Restructuring and other charges (credits) (c) | (0.05) |
| 0.13 |
| ||
Joint venture restructuring charge (d) | — |
| 0.02 |
| ||
Debt extinguishment charge (e) | — |
| 0.17 |
| ||
Income tax valuation allowance (f) | — |
| 0.78 |
| ||
Net loss attributable to ATI excluding special items | $ | (0.12) |
| $ | (0.02) |
|
Earnings before interest, taxes, depreciation and amortization (EBITDA) |
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| Three Months Ended | ||||||||||
|
| June 30, 2021 |
| March 31, 2021 |
| June 30, 2020 | ||||||
Net loss | $ | (44.4) |
|
| $ | (2.4) |
|
| $ | (419.9) |
|
| (+) Depreciation and Amortization | 36.3 |
|
| 36.1 |
|
| 35.6 |
| |||
| (+) Interest Expense | 23.7 |
|
| 23.4 |
|
| 21.7 |
| |||
| (+) Income Tax Provision | 4.0 |
|
| 5.5 |
|
| 92.6 |
| |||
| (+) Debt extinguishment charge (e) | — |
|
| — |
|
| 21.5 |
| |||
| (+) Impairment of goodwill (b) | — |
|
| — |
|
| 287.0 |
| |||
| (+) Strike related costs (a) | 40.3 |
|
| — |
|
| — |
| |||
| (+/-) Restructuring and other charges (credits) (c) | (6.2) |
|
| — |
|
| 16.7 |
| |||
| (+) Joint venture impairment charge (d) | — |
|
| — |
|
| 2.4 |
| |||
| Total ATI Adjusted EBITDA | $ | 53.7 |
|
| $ | 62.6 |
|
| $ | 57.6 |
|
| LIFO and net realizable value reserves | — |
|
| — |
|
| — |
| |||
| Corporate expenses | 15.9 |
|
| 12.2 |
|
| 7.2 |
| |||
| Closed operations and other expense (income) | 3.6 |
|
| (0.5) |
|
| (2.7) |
| |||
| Total segment EBITDA | $ | 73.2 |
|
| $ | 74.3 |
|
| $ | 62.1 |
|
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| * Presentation of adjusted results per diluted share includes the effects of convertible debt, if dilutive. |
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|
| (a) Second quarter 2021 results include $40.3 million of pre-tax strike related costs primarily consisting of overhead costs recognized in the period due to below-normal operating rates, higher costs for outside conversion activities, and ongoing benefit costs for striking employees. |
| (b) Second quarter 2020 results include a $287.0 million pre-tax goodwill impairment charge to write-off a portion of the Company's goodwill related to its Forged Products reporting unit. |
| (c) Second quarter 2021 results include a $6.2 million pre-tax net credit for restructuring charges, primarily related to lowered severance-related reserves based on changes in planned operating rates and revised workforce reduction estimates. Second quarter 2020 results include a $16.7 million pre-tax restructuring charge related to severance charges for involuntary reductions and voluntary retirement incentive programs for the HPMC segment. |
| (d) Second quarter 2020 results include a $2.4 million pre-tax charge for ATI's 50% portion of severance charges recorded by |
| the Allegheny & Tsingshan Stainless joint venture. |
| (e) Second quarter 2020 results include a $21.5 million pre-tax debt extinguishment charge for the partial redemption of the $287.5 million, 4.75% Convertible Notes due 2022. |
| (f) Second quarter 2020 results include a $99.0 million discrete tax charge related to deferred tax valuation allowances due to re-entering a three-year cumulative loss condition for U.S. Federal and state jurisdictions. |
