TIMKENSTEEL CORP, 10-K filed on 2/24/2023
Annual Report
v3.22.4
Document and Entity Information - USD ($)
 12 Months Ended
Dec. 31, 2022
Feb. 15, 2023
Jun. 30, 2022
Cover [Abstract]      
Document Type 10-K    
Amendment Flag false    
Document Period End Date Dec. 31, 2022    
Document Fiscal Year Focus 2022    
Document Fiscal Period Focus FY    
Trading Symbol TMST    
Title of 12(b) Security Common shares    
Security Exchange Name NYSE    
Entity Registrant Name TIMKENSTEEL CORPORATION    
Entity Central Index Key 0001598428    
Current Fiscal Year End Date --12-31    
Entity Filer Category Large Accelerated Filer    
Entity Small Business false    
Entity Emerging Growth Company false    
Entity Well-known Seasoned Issuer No    
Entity Voluntary Filers No    
Entity Common Stock, Shares Outstanding   43,896,048  
Entity Public Float     $ 839,412,924
Entity Current Reporting Status Yes    
Entity Interactive Data Current Yes    
Entity Shell Company false    
ICFR Auditor Attestation Flag true    
Document Annual Report true    
Document Transition Report false    
Entity Incorporation, State or Country Code OH    
Entity Address, Address Line One 1835 Dueber Avenue SW    
Entity Address, City or Town Canton    
Entity Address, State or Province OH    
City Area Code 330    
Local Phone Number 471.7000    
Entity Address, Postal Zip Code 44706    
Entity Tax Identification Number 46-4024951    
Entity File Number 1-36313    
Documents Incorporated by Reference

DOCUMENTS INCORPORATED BY REFERENCE

 

Document

 

Parts Into Which Incorporated

Proxy Statement for the 2023 Annual Meeting of Shareholders

 

Part III
   
Auditor Name Ernst & Young LLP    
Auditor Firm ID 42    
Auditor Location Cleveland, Ohio    
v3.22.4
Consolidated Statements of Operations - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Income Statement [Abstract]      
Net sales $ 1,329.9 $ 1,282.9 $ 830.7
Cost of products sold 1,203.2 1,062.9 815.1
Gross Profit 126.7 220.0 15.6
Selling, general and administrative expenses 73.8 77.2 76.7
Restructuring charges 0.8 6.7 3.1
Loss on sale of consolidated subsidiary 0.0 1.1 0.0
Loss (gain) on sale or disposal of assets, net 1.9 1.3 (2.4)
Impairment charges 0.0 10.6 0.0
Interest (income) expense, net 0.6 5.9 12.2
Loss on extinguishment of debt 43.1 0.0 0.9
Other (income) expense, net (90.6) (59.5) (14.2)
Income (loss) from operations before income taxes 97.1 176.7 (60.7)
Provision (benefit) for income taxes 32.0 5.7 1.2
Net Income (Loss) $ 65.1 $ 171.0 $ (61.9)
Per Share Data:      
Basic earnings (loss) per share $ 1.42 $ 3.73 $ (1.38)
Diluted earnings (loss) per share $ 1.30 $ 3.18 $ (1.38)
v3.22.4
Consolidated Statements of Comprehensive Income (Loss) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Statement of Comprehensive Income [Abstract]      
Net income (loss) $ 65.1 $ 171.0 $ (61.9)
Other comprehensive income (loss), net of tax of $0.4 million in 2022, none in 2021, and $0.1 million in 2020:      
Foreign currency translation adjustments (1.7) 0.3 1.4
Pension and postretirement liability adjustments (4.3) (20.0) (5.7)
Other comprehensive income (loss), net of tax (6.0) (19.7) (4.3)
Comprehensive Income (Loss), net of tax $ 59.1 $ 151.3 $ (66.2)
v3.22.4
Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Statement of Comprehensive Income [Abstract]      
Other comprehensive income (loss), net of tax $ 0.4 $ 0.0 $ 0.1
v3.22.4
Consolidated Balance Sheets - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
Current Assets    
Cash and cash equivalents $ 257.2 $ 259.6
Accounts receivable, net of allowances (2022 - $1.0 million; 2021 - $1.9 million) 79.4 100.5
Inventories, net 192.4 210.9
Deferred charges and prepaid expenses 6.4 3.9
Assets held for sale 0.0 4.3
Other current assets 21.2 3.1
Total Current Assets 556.6 582.3
Property, plant and equipment, net 486.1 510.2
Operating lease right-of-use assets 12.5 14.5
Pension assets 19.4 43.1
Intangible assets, net 5.0 6.7
Other non-current assets 2.4 2.1
Total Assets 1,082.0 1,158.9
Current Liabilities    
Accounts payable 113.2 141.9
Salaries, wages and benefits 21.2 37.9
Accrued pension and postretirement costs 2.0 4.3
Current operating lease liabilities 6.0 5.7
Current convertible notes, net 20.4 44.9
Other current liabilities 23.9 16.1
Total Current Liabilities 186.7 250.8
Non-Current Liabilities    
Credit Agreement 0.0 0.0
Non-current operating lease liabilities 6.5 8.8
Accrued pension and postretirement costs 162.9 223.0
Deferred income taxes 25.9 2.2
Other non-current liabilities 13.5 9.5
Total Liabilities 395.5 494.3
Shareholders’ Equity    
Preferred shares, without par value; authorized 10.0 million shares, none issued 0.0 0.0
Common shares, without par value; authorized 200.0 million shares; issued 2022 - 47.1 million shares; issued 2021 - 46.3 million shares 0.0 0.0
Additional paid-in capital 847.0 832.1
Retained deficit (123.1) (188.2)
Treasury shares - 2022 - 3.0 million; 2021 - None (52.1) 0.0
Accumulated other comprehensive income (loss) 14.7 20.7
Total Shareholders’ Equity 686.5 664.6
Total Liabilities and Shareholders’ Equity $ 1,082.0 $ 1,158.9
v3.22.4
Consolidated Balance Sheets (Parenthetical) - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
Statement of Financial Position [Abstract]    
Allowances for accounts receivable $ 1.0 $ 1.9
Preferred shares, authorized (in shares) 10,000,000.0 10,000,000.0
Preferred shares, issued (in shares) 0 0
Common shares, authorized (in shares) 200,000,000.0 200,000,000.0
Common shares, issued (in shares) 47,100,000 46,300,000
Treasury shares (in shares) 3,000,000.0 0
v3.22.4
Consolidated Statements of Shareholder's Equity - USD ($)
$ in Millions
Total
Cumulative Effect, Period of Adoption, Adjustment
Common Shares
Additional Paid-in Capital
Additional Paid-in Capital
Cumulative Effect, Period of Adoption, Adjustment
Retained Deficit
Retained Deficit
Cumulative Effect, Period of Adoption, Adjustment
Treasury Shares
Accumulated Other Comprehensive Income (Loss)
Beginning balance at Dec. 31, 2019 $ 563.1     $ 844.8   $ (301.5)   $ (24.9) $ 44.7
Beginning balance (in shares) at Dec. 31, 2019     44,820,153            
Increase (Decrease) in Stockholders' Equity [Roll Forward]                  
Net income (loss) (61.9)         (61.9)      
Other comprehensive income (loss) (4.3)               (4.3)
Stock-based compensation expense 6.6     6.6          
Issuance of treasury shares       (12.6)       12.6  
Issuance of treasury shares (in shares)     486,260            
Shares surrendered for taxes (0.6)             (0.6)  
Shares surrendered for taxes (in shares)     (142,105)            
Equity component of convertible notes, net 4.6     4.6          
Ending balance at Dec. 31, 2020 507.5     843.4   (363.4)   (12.9) 40.4
Ending balance (in shares) at Dec. 31, 2020     45,164,308            
Increase (Decrease) in Stockholders' Equity [Roll Forward]                  
Net income (loss) 171.0         171.0      
Other comprehensive income (loss) (19.7)               (19.7)
Stock-based compensation expense 7.3     7.3          
Stock-based compensation expense (in shares)     272,462            
Stock option activity 4.1     4.1          
Stock options activity (in shares)     152,940            
Issuance of treasury shares       (13.4)       13.4  
Issuance of treasury shares (in shares)     638,093            
Shares surrendered for taxes (0.5)             (0.5)  
Shares surrendered for taxes (in shares)     (72,174)            
Equity component of convertible notes, net 1.3     1.3          
Convertible notes settlement (in shares)     113,226            
Ending balance at Dec. 31, 2021 664.6 $ (6.4)   832.1 $ (10.6) (188.2) $ 4.2   20.7
Ending balance (in shares) at Dec. 31, 2021     46,268,855            
Increase (Decrease) in Stockholders' Equity [Roll Forward]                  
Net income (loss) 65.1         65.1      
Other comprehensive income (loss) (6.0)               (6.0)
Stock-based compensation expense 8.8     8.8          
Stock-based compensation expense (in shares)     342,805            
Stock option activity $ 8.0     8.0          
Stock options activity (in shares) 518,770   499,040            
Purchase of treasury shares $ (52.0)             (52.0)  
Purchase of treasury shares (in Shares)     (3,026,491)            
Issuance of treasury shares       (1.7)       1.7  
Issuance of treasury shares (in shares)     97,475            
Shares surrendered for taxes (2.0)     (0.2)       (1.8)  
Shares surrendered for taxes (in shares)     (116,793)            
Ending balance at Dec. 31, 2022 $ 686.5     $ 847.0   $ (123.1)   $ (52.1) $ 14.7
Ending balance (in shares) at Dec. 31, 2022     44,064,891            
v3.22.4
Consolidated Statements of Cash Flows - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Operating Activities      
Net income (loss) $ 65.1 $ 171.0 $ (61.9)
Adjustments to reconcile net income (loss) to net cash provided (used) by operating activities:      
Depreciation and amortization 58.3 63.1 70.0
Amortization of deferred financing fees and debt discount 0.7 1.0 5.3
Loss on extinguishment of debt 43.1 0.0 0.9
Loss on sale of consolidated subsidiary 0.0 1.1 0.0
Loss (gain) on sale or disposal of assets, net 1.9 1.3 (2.4)
Impairment charges 0.0 10.6 0.0
Deferred income taxes 24.9 1.2 0.0
Stock-based compensation expense 8.8 7.3 6.6
Pension and postretirement expense (benefit), net (40.5) (38.7) 8.6
Changes in operating assets and liabilities:      
Accounts receivable, net 21.3 (37.2) 14.2
Inventories, net 18.8 (41.6) 103.5
Accounts payable (33.2) 53.5 23.1
Other accrued expenses (8.8) 9.7 9.4
Deferred charges and prepaid expenses (2.6) 0.1 (0.7)
Pension and postretirement contributions and payments (5.4) (6.9) (4.1)
Other, net (17.9) 1.4 1.0
Net Cash Provided (Used) by Operating Activities 134.5 196.9 173.5
Investing Activities      
Capital expenditures (27.1) (12.2) (16.9)
Proceeds from sale of consolidated subsidiary, net 0.0 6.2 0.0
Proceeds from disposals of property, plant and equipment 5.4 1.2 10.9
Net Cash Provided (Used) by Investing Activities (21.7) (4.8) (6.0)
Financing Activities      
Purchase of treasury shares (52.0) 0.0 0.0
Proceeds from exercise of stock options 8.0 4.1 0.0
Shares surrendered for employee taxes on stock compensation (2.0) (0.5) (0.6)
Repayments on convertible notes (67.6) (38.9) 0.0
Repayments on credit agreements 0.0 0.0 (90.0)
Debt issuance costs (1.0) 0.0 (1.2)
Net Cash Provided (Used) by Financing Activities (114.6) (35.3) (91.8)
Increase (Decrease) in Cash, Cash Equivalents, and Restricted Cash (1.8) 156.8 75.7
Cash and cash equivalents at beginning of period 259.6 102.8 27.1
Cash and Cash Equivalents at End of Period $ 257.8 $ 259.6 $ 102.8
v3.22.4
Consolidated Statements of Cash Flows (Parenthetical) - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Cash, Cash Equivalents, Restricted Cash, and Restricted Cash Equivalents [Abstract]      
Cash and cash equivalents $ 257.2 $ 259.6 $ 102.8
Restricted cash reported in other current assets 0.6 0.0 0.0
Total cash, cash equivalents, and restricted cash shown in the Consolidated Statements of Cash Flows $ 257.8 $ 259.6 $ 102.8
v3.22.4
Basis of Presentation
 12 Months Ended
Dec. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Basis of Presentation

Note 1 - Basis of Presentation

TimkenSteel Corporation (the "Company" or "TimkenSteel") manufactures alloy steel, as well as carbon and micro-alloy steel using electric arc furnace ("EAF") technology. TimkenSteel’s portfolio includes special bar quality ("SBQ") bars, seamless mechanical tubing ("tubes"), manufactured components, such as precision steel components, and billets. Additionally, TimkenSteel manages raw material recycling programs, which are used internally as a feeder system for our melt operations and allow us to sell scrap not used in our operations to third parties. The Company’s products and services are used in a diverse range of demanding applications in the following market sectors: automotive; oil and gas; industrial equipment; mining; construction; rail; defense; heavy truck; agriculture; and power generation.

The SBQ bar, tube, and billet production processes take place at the Company’s Canton, Ohio manufacturing location. This location accounts for all of the SBQ bars, seamless mechanical tubes and billets the Company produces and includes three manufacturing facilities: the Faircrest, Harrison, and Gambrinus facilities. TimkenSteel’s production of manufactured components takes place at two downstream manufacturing facilities: Tryon Peak (Columbus, North Carolina) and St. Clair (Eaton, Ohio). Many of the production processes are integrated, and the manufacturing facilities produce products that are sold in all of the Company’s market sectors. As a result, investments in the Company’s facilities and resource allocation decisions affecting the Company’s operations are designed to benefit the overall business, not any specific aspect of the business.

Prior to indefinitely idling our Harrison melt and casting assets in the first quarter of 2021, we had an annual melt capacity of approximately 2 million tons and shipment capacity of 1.5 million tons. After indefinitely idling these assets, our annual melt capacity is approximately 1.2 million tons and our shipment capacity is approximately 0.9 million tons. In addition to our internal melt capacity, the Company periodically purchases third party melt to supplement customer demand and leverage our downstream operations.

Basis of Consolidation:

The Consolidated Financial Statements include the consolidated assets, liabilities, revenues and expenses related to TimkenSteel as of December 31, 2022, 2021 and 2020. All significant intercompany accounts and transactions within TimkenSteel have been eliminated in the preparation of the Consolidated Financial Statements.

Use of Estimates:

The preparation of these Consolidated Financial Statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the Consolidated Financial Statements and accompanying notes. These estimates and assumptions are reviewed and updated regularly to reflect recent experience.

Presentation:

Certain items previously reported in specific financial statement captions have been reclassified to conform with current year presentation.
v3.22.4
Significant Accounting Policies
 12 Months Ended
Dec. 31, 2022
Accounting Policies [Abstract]  
Significant Accounting Policies

Note 2 - Significant Accounting Policies

Revenue Recognition:

TimkenSteel recognizes revenue from contracts at a point in time when it has satisfied its performance obligation and the customer obtains control of the goods, at the amount that reflects the consideration the Company expects to receive for those goods.

 

Substantially all performance obligations arise from the sale of manufactured steel products. The Company receives and acknowledges purchase orders from its customers, which define the quantity, pricing, payment and other applicable terms and conditions. In some cases, the Company receives a blanket purchase order from its customer, which includes pricing, payment and other terms and conditions, with quantities defined at the time the customer issues periodic releases from the blanket purchase order.

 

Transfer of control and revenue recognition for substantially all the Company’s sales occur upon shipment or delivery of the product, which is when title, ownership, and risk of loss pass to the customer and is based on the applicable customer shipping terms.

 

The Company invoices its customers at the time of title transfer. Payment terms are generally 30 days from the invoice date. Invoiced amounts are usually inclusive of shipping and handling activities incurred. Shipping and handling activities billed are included in net sales in the Consolidated Statements of Operations. The related costs incurred by the Company for the delivery of goods are classified as cost of products sold in the Consolidated Statements of Operations.

 

Certain contracts contain variable consideration, which primarily consists of rebates that are accounted for in net sales and accrued based on the estimated probability of the requirements being met.

 

Sales returns and allowances are treated as a reduction to net sales and are provided for primarily based on historical experience. These reserves also capture any potential warranty claims, which normally result in returned or replaced product.

Cash Equivalents and Restricted Cash:

TimkenSteel considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents.

The Company's restricted cash balance represents an imprest cash account used for the funding of employee healthcare costs. Funding of this account began during the first quarter of 2022 when the Company changed its healthcare plan administrator. The balance of restricted cash as of December 31, 2022 was $0.6 million, which is included in other current assets on the Consolidated Balance Sheets. The Company had no restricted cash as of December 31, 2021.

Accounts Receivables, Net:

The Company’s accounts receivables arise from sales to customers across the mobile, industrial, energy, and other end-market sectors. The allowance for doubtful account reserve has been established using qualitative and quantitative methods. In general, account balances are fully reserved when greater than one year of age or sent to third party collection. Account balances for customers that are viewed as higher risk are also analyzed for a reserve. In addition to these methods, the allowance for doubtful accounts is adjusted for forward-looking estimates of uncollectible balances based on end-market sector outlook and dynamics. Historically, write-offs for TimkenSteel’s allowance for doubtful accounts have been immaterial.

Inventories, Net:

Inventories are stated at lower of cost or net realizable value. All inventories, including raw materials, manufacturing supplies inventory, as well as international (outside the U.S.) inventories, have been valued using the FIFO or average cost method.

Property, Plant and Equipment, Net:

Property, plant and equipment, net are valued at cost less accumulated depreciation. Maintenance and repairs are charged to expense as incurred. The provision for depreciation is computed principally by the straight-line method based upon the estimated useful lives of the assets. The useful lives are approximately 30 years for buildings and 3 to 20 years for machinery and equipment.

Intangible Assets, Net:

Intangible assets subject to amortization are amortized on a straight-line method over their legal or estimated useful lives, with useful lives ranging from 3 to 15 years.

In accordance with applicable accounting guidance, TimkenSteel capitalizes certain costs incurred for computer software developed or obtained for internal use. TimkenSteel capitalizes substantially all external costs and qualifying internal costs related to the purchase and implementation of software projects used for business operations. Capitalized software costs primarily include purchased software and external consulting fees. Capitalized software projects are amortized over the estimated useful lives of the software.

Long-lived Assets:

Long-lived assets (including tangible assets and intangible assets subject to amortization) are reviewed for impairment when events or changes in circumstances have occurred indicating that the carrying value of the assets may not be recoverable.

TimkenSteel tests recoverability of long-lived assets at the lowest level for which there are identifiable cash flows that are independent from the cash flows of other assets. Assets and asset groups held and used are measured for recoverability by comparing the carrying amount of the asset or asset group to the sum of future undiscounted net cash flows expected to be generated by the asset or asset group.

Assumptions and estimates about future values and remaining useful lives of TimkenSteel’s long-lived assets are complex and subjective. They can be affected by a variety of factors, including external factors such as industry and economic trends and internal factors such as changes in TimkenSteel’s business strategy and internal forecasts.

If an asset or asset group is considered to be impaired, the impairment loss that would be recognized is the amount by which the carrying amount of the assets exceeds the fair value of the assets. To determine fair value, TimkenSteel uses internal cash flow estimates discounted at an appropriate interest rate, third party appraisals, as appropriate, and/or market prices of similar assets, when available.

Refer to “Note 6 - Disposition of Non-Core Assets” and “Note 11 - Property, Plant and Equipment” for additional information.

Product Warranties:

TimkenSteel accrues liabilities for warranties based upon specific claim incidents in accordance with accounting rules relating to contingent liabilities. Should TimkenSteel become aware of a specific potential warranty claim for which liability is probable and reasonably estimable, a specific charge is recorded and accounted for accordingly. TimkenSteel had warranty claims in the amount of $0.7 million and $1.4 million for the years ended December 31, 2022 and December 31, 2021, respectively. TimkenSteel had no significant warranty claims for the year ended December 31, 2020. Warranty claims are included in cost of products sold on the Consolidated Statements of Operations.

Income Taxes:

Deferred tax assets and liabilities are recorded for the future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases, as well as net operating loss and tax credit carryforwards. TimkenSteel accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined on the basis of the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. TimkenSteel recognizes deferred tax assets to the extent TimkenSteel believes these assets are more likely than not to be realized. In making such a determination, TimkenSteel considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. If TimkenSteel determines that it would be able to realize deferred tax assets in the future in excess of their net recorded amount, TimkenSteel would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes.

TimkenSteel records uncertain tax positions in accordance with applicable accounting guidance, on the basis of a two-step process whereby (1) TimkenSteel determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position, and (2) for those tax positions that meet the more-likely-than-not recognition threshold, TimkenSteel recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority.

TimkenSteel recognizes interest and penalties related to unrecognized tax benefits within the provision (benefit) for income taxes line in the accompanying Consolidated Statements of Operations, if applicable. Accrued interest and penalties are included within the related tax liability line in the Consolidated Balance Sheets.

Foreign Currency:

Assets and liabilities of subsidiaries are translated at the rate of exchange in effect on the balance sheet date. Income and expenses are translated at the average rates of exchange prevailing during the year. The related translation adjustments are reflected as a separate component of accumulated other comprehensive income (loss). Gains and losses resulting from foreign currency transactions are included in other (income) expense, net in the Consolidated Statements of Operations. For the year ended December 31, 2022, TimkenSteel realized a foreign currency exchange gain of $0.2 million. For the years ended December 31, 2021 and December 31, 2020, TimkenSteel realized a foreign currency exchange loss of $0.1 million and $0.2 million, respectively.

Pension and Other Postretirement Benefits:

TimkenSteel recognizes an overfunded status or underfunded status (e.g., the difference between the fair value of plan assets and the benefit obligations) as either an asset or a liability for its defined benefit pension and other postretirement benefit plans on the Consolidated Balance Sheets. The Company recognizes actuarial gains and losses immediately through net periodic benefit cost in the Consolidated Statements of Operations upon the annual remeasurement at December 31, or on an interim basis as triggering events warrant remeasurement. An example of a potential triggering event would be settlements. The Company’s accounting policy is to recognize settlements during the quarter in which it is projected that the costs of all settlements during the year will be greater than the sum of the service cost and interest cost components of net periodic benefit cost. In addition, the Company uses fair value to account for the value of plan assets.

Stock-Based Compensation:

TimkenSteel recognizes stock-based compensation expense based on the grant date fair value of the stock-based awards over their required vesting period on a straight-line basis, whether the awards were granted with graded or cliff vesting. Stock options are issued with an exercise price equal to the closing market price of TimkenSteel common shares on the date of grant. The fair value of stock options is determined using a Black-Scholes option pricing model, which incorporates assumptions regarding the expected volatility, the expected option life, the risk-free interest rate and the expected dividend yield.

Performance-based restricted stock units vest based on achievement of a total shareholder return ("TSR") metric. The TSR metric is considered a market condition, which requires TimkenSteel to reflect it in the fair value on grant date using an advanced option-pricing model. The fair value of each performance share was therefore determined using a Monte Carlo valuation model, a generally accepted lattice pricing model. The Monte Carlo valuation model, among other factors, uses commonly-accepted economic theory underlying all valuation models, estimates fair value using simulations of future share prices based on stock price behavior and considers the correlation of peer company returns in determining fair value.

The fair value of stock-based awards that will settle in TimkenSteel common shares, other than stock options and performance-based restricted stock units, is based on the closing market price of TimkenSteel common shares on the grant date.

TimkenSteel recognizes all excess tax benefits and tax deficiencies as income tax expense or benefit in the Consolidated Statements of Operations. The excess tax benefits and tax deficiencies are considered discrete items in the reporting period they occur and are not included in the estimate of an entity’s annual effective tax rate.

Research and Development:

Expenditures for research and development at TimkenSteel amounted to $0.8 million, $1.7 million and $1.8 million for the years ended December 31, 2022, 2021, and 2020, respectively, and were recorded as a component of selling, general and administrative expenses in the Consolidated Statements of Operations. These expenditures may fluctuate from year to year depending on special projects and the needs of TimkenSteel and its customers.

Adoption of New Accounting Standards

The Company did not adopt any Accounting Standard Updates (“ASU”) during 2022. Additionally, there are no current ASUs issued, but not adopted, that are expected to have a material impact on the Company.

 

As of January 1, 2021, the Company early adopted ASU 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40), using the modified retrospective method of transition. The standard simplifies the accounting for convertible instruments.

 

Upon adoption of ASU 2020-06 as of January 1, 2021, all outstanding Convertible Notes were fully classified as a liability, there was no longer a separate equity component and the Convertible Notes no longer have a debt discount that is amortized. This resulted in a decrease of $10.6 million to additional paid-in capital and an increase of $1.1 million and $5.3 million to current convertible notes, net and non-current convertible notes, net, respectively, on the Consolidated Balance Sheets as of January 1, 2021. Additionally, retained deficit was reduced by $4.2 million in the Consolidated Balance Sheets as of January 1, 2021 to remove amortization expense recognized in prior periods. The adoption of this standard did not have an effect on the Company’s cash flows, liquidity, or the methodology used for the earnings per share calculation. Refer to “Note 14 – Financing Arrangements” for additional information on the Convertible Notes.

 

Legislation related to the COVID-19 Pandemic

Due to a provision in the Coronavirus Aid, Relief, and Economic Security ("CARES") Act, the Company was able to defer the employer share of Social Security payroll taxes for a specified time during 2020. During the year ended December 31, 2020, the Company deferred $6.4 million in cash payments and recorded reserves for such deferred payroll taxes in salaries, wages and benefits on the Consolidated Balance Sheets, to be paid in two equal installments. The first installment in the amount of $3.2 million was paid during the fourth quarter of 2021 and the second installment of $3.2 million was paid during the fourth quarter of 2022.

 

The CARES Act also provided for an employee retention credit (“Employee Retention Credit”), which is a refundable tax credit against certain employment taxes. The Company qualified for the tax credit in the second and third quarters of 2020 and accrued a benefit of $2.3 million in the fourth quarter of 2020 related to the Employee Retention Credit in other (income) expense, net on the Consolidated Statements of Operations. The Company filed for this credit in the second quarter of 2021 and received a portion of the proceeds from the Internal Revenue Service ("IRS") in the amount of $0.5 million during the fourth quarter of 2021. The Company received the remaining $1.8 million of cash proceeds in the first quarter of 2022.
v3.22.4
Segment Information
 12 Months Ended
Dec. 31, 2022
Segment Reporting [Abstract]  
Segment Information

Note 3 - Segment Information

We conduct our business activities and report financial results as one business segment. The presentation of financial results as one reportable segment is consistent with the way the Company operates its business and is consistent with the manner in which the Chief Operating Decision Maker ("CODM") evaluates performance and makes resource and operating decisions for the business as described above. Furthermore, the Company notes that monitoring financial results as one reportable segment helps the CODM manage costs on a consolidated basis, consistent with the integrated nature of the operations.

Geographic Information

Net sales by geographic area are reported by the country in which the customer is domiciled. Long-lived assets include property, plant and equipment and intangible assets subject to amortization. Long-lived assets by geographic area are reported by the location of the TimkenSteel operations to which the asset is attributed.
 

 

 

Year Ended December 31,

 

 

 

2022

 

 

2021

 

 

2020

 

Net Sales:

 

 

 

 

 

 

 

 

 

United States

 

$

1,201.3

 

 

$

1,166.1

 

 

$

746.8

 

Foreign

 

 

128.6

 

 

 

116.8

 

 

 

83.9

 

 

 

$

1,329.9

 

 

$

1,282.9

 

 

$

830.7

 

 

 

 

December 31,

 

 

 

2022

 

 

2021

 

Long-lived Assets, net:

 

 

 

 

 

 

United States

 

$

503.0

 

 

$

530.7

 

Foreign

 

 

0.6

 

 

 

0.7

 

 

 

$

503.6

 

 

$

531.4

 
v3.22.4
Revenue Recognition
 12 Months Ended
Dec. 31, 2022
Revenue from Contract with Customer [Abstract]  
Revenue Recognition

Note 4 - Revenue Recognition

The following table provides the major sources of revenue by end-market sector for the years ended December 31, 2022, 2021 and 2020:

 

 

Year Ended December 31,

 

 

 

2022

 

 

2021

 

 

2020

 

Mobile

 

$

539.1

 

 

$

527.9

 

 

$

346.0

 

Industrial

 

 

628.7

 

 

 

661.2

 

 

 

391.7

 

Energy

 

 

136.6

 

 

 

62.9

 

 

 

53.2

 

Other(1)

 

 

25.5

 

 

 

30.9

 

 

 

39.8

 

Total Net Sales

 

$

1,329.9

 

 

$

1,282.9

 

 

$

830.7

 

 

(1) “Other” sales by end-market sector includes the Company’s scrap sales. In addition, 2020 includes oil country tubular goods billet sales.

The following table provides the major sources of revenue by product type for the years ended December 31, 2022, 2021 and 2020:

 

 

Year Ended December 31,

 

 

 

2022

 

 

2021

 

 

2020

 

Bar

 

$

887.4

 

 

$

863.6

 

 

$

502.5

 

Tube

 

 

173.7

 

 

 

164.4

 

 

 

101.4

 

Manufactured components

 

 

243.3

 

 

 

224.0

 

 

 

208.1

 

Other(2)

 

 

25.5

 

 

 

30.9

 

 

 

18.7

 

Total Net Sales

 

$

1,329.9

 

 

$

1,282.9

 

 

$

830.7

 

 

(2) “Other” for sales by product type relates to the Company’s scrap sales.

 

Contract liabilities are recognized when the Company has received consideration from a customer to transfer goods at a future point in time. Contract liabilities are primarily related to deferred revenue resulting from cash payments received in advance from customers and are included in other current liabilities on the Consolidated Balance Sheets. As of December 31, 2022, contract liabilities totaled $3.6 million and were less than $0.1 million as of December 31, 2021.

v3.22.4
Restructuring Charges
 12 Months Ended
Dec. 31, 2022
Restructuring and Related Activities [Abstract]  
Restructuring Charges

Note 5 - Restructuring Charges

Over the past several years, TimkenSteel has made numerous organizational changes to enhance profitable and sustainable growth. These company-wide actions included the restructuring of its business support functions, the reduction of management layers throughout the organization and other domestic and international actions to further improve the Company’s overall cost structure. Restructuring charges for the years ended December 31, 2022, 2021, and 2020 totaled $0.8 million, $6.7 million, and $3.1 million, respectively.

 

For the year ended December 31, 2022, restructuring charges were related to severance and employee-related benefits, as a result of continued organizational changes. During 2021, $6.4 million of restructuring charges related to severance and employee-related benefits as a result of continued organizational changes. The remaining $0.3 million of charges related to the transition of customers to other TimkenSteel manufacturing equipment due to the discontinuation of specific small-diameter seamless mechanical tube manufacturing and the indefinite idling of our Harrison melt and casting activities (refer to “Note 6 – Disposition of Non-Core Assets” for additional information). Restructuring charges for 2020 primarily consisted of severance and employee related benefits.

 

TimkenSteel recorded reserves for such restructuring charges as other current liabilities on the Consolidated Balance Sheets. The reserve balance at December 31, 2022 is expected to be substantially used in the next twelve months.

The following is a summary of the restructuring reserve for the twelve months ended December 31, 2022 and 2021:

Balance at December 31, 2021

 

$

4.7

 

Expenses

 

 

0.8

 

Payments

 

 

(5.0

)

Balance at December 31, 2022

 

$

0.5

 

 

Balance at December 31, 2020

 

$

1.5

 

Expenses

 

 

6.7

 

Payments

 

 

(3.5

)

Balance at December 31, 2021

 

$

4.7

 
v3.22.4
Disposition of Non-Core Assets
 12 Months Ended
Dec. 31, 2022
Discontinued Operations and Disposal Groups [Abstract]  
Disposition of Non-Core Assets

Note 6 - Disposition of Non-Core Assets

TimkenSteel Material Services Facility

During the first quarter of 2020, management completed its previously announced plan to close the Company’s TimkenSteel Material Services (“TMS”) facility in Houston and began selling the assets at the facility. Accelerated depreciation and amortization on TMS assets of $2.8 million was recorded in the fourth quarter of 2019, with an additional $1.6 million of accelerated depreciation and amortization recorded in the first quarter of 2020, to reduce the net book value of the machinery and equipment to its estimated fair value. Subsequent to the closure, certain assets were sold and a gain on sale of $3.6 million was recognized for the year ended December 31, 2020.

Inventory write-downs of $4.8 million were recorded as of December 31, 2019, which represented the difference between the expected selling price and carrying value of the related inventory. The expected selling price was based upon the Company’s most recently published price lists related to this inventory. While the Company began selling the inventory associated with TMS in the first quarter of 2020 at prices that were in line with the net realizable value of the inventory established in the fourth quarter of 2019, excess inventory related to the energy end-market sector resulted in an additional reserve of approximately $3.1 million being recorded in the second quarter of 2020. The excess inventory was the result of continued weakness in this end-market sector, as well as the closures of several distributors that were holding considerable amounts of similar inventory. There was no inventory at December 31, 2021 associated with TMS, as the remaining inventory was sold throughout 2021. Furthermore, inventory reserves were reversed throughout 2021 as the related TMS inventory was sold or scrapped.

During 2021, the remaining associated machinery and equipment that was classified as held for sale was fully impaired as there was no longer an expected market value for these assets. This resulted in impairment charges of $0.3 million.

A small parcel of land associated with TMS was sold during the fourth quarter of 2021 for $0.3 million resulting in a gain on sale of $0.1 million. The remaining $4.3 million of land and buildings associated with TMS were classified as assets held for sale on the Consolidated Balance Sheets as of December 31, 2021. All of these assets were sold during the third quarter of 2022. Net cash proceeds of $2.8 million were received and a loss on sale of assets of $1.5 million was recognized on the Consolidated Statements of Operations during 2022.

Small-Diameter Seamless Mechanical Tubing Machinery and Equipment

In the third quarter of 2020, TimkenSteel informed customers that as of December 31, 2020 the Company would discontinue the commercial offering of specific small-diameter seamless mechanical tubing products. As a result, the Company recognized accelerated depreciation of $1.8 million for the year ended December 31, 2020 on the machinery and equipment used in the manufacturing of these specific products. Additional accelerated depreciation of $1.5 million was recognized in the first quarter of 2021 in alignment with the ramp down of this machinery and equipment. Spare parts related to this machinery and equipment of $0.5 million were also written down in the first quarter of 2021, as management determined there was no alternative use.

In the fourth quarter of 2022, TimkenSteel entered into an agreement to sell the machinery and equipment used in the manufacturing of these specific products. Pursuant to this agreement, TimkenSteel received a down payment in the amount of $1.7 million, which is included in other current liabilities on the Consolidated Balance Sheets as of December 31, 2022. This down payment was also classified as proceeds from disposals of property, plant, and equipment within the investing section of the Consolidated Statements of Cash Flows for the year ended December 31, 2022. The Company expects to receive an additional $1.7 million in the first half of 2023, resulting in a gain of disposal of assets of $3.4 million.

Harrison Melt and Casting Assets

On February 16, 2021, management announced a plan to indefinitely idle its Harrison melt and casting assets, which was completed in the first quarter of 2021. All of the Company’s melt and casting activities now take place at the Faircrest location. The Company worked collaboratively with employees, suppliers and a number of customers to ensure a well-organized and efficient transition. The Company’s rolling and finishing operations at Harrison were not impacted by this action.

 

The Company recognized non-cash charges of $9.5 million related to the write-down of the associated Harrison melt and casting assets in the first quarter of 2021. These charges include $7.9 million related to the impairment of the associated machinery and equipment, which is classified as impairment charges on the Consolidated Statements of Operations, as well as a write-down of spare parts of $1.6 million, which is included in cost of products sold in the Consolidated Statements of Operations, as management determined there was no alternative use. The Company did not incur any cash expenditures related to these charges.

TimkenSteel (Shanghai) Corporation Limited

On March 31, 2021, the Company entered into an agreement pursuant to which Daido Steel (Shanghai) Co., Ltd. agreed to acquire all of the Company’s ownership interest in TimkenSteel (Shanghai) Corporation Limited in an all-cash transaction. The sale closed on July 30, 2021 and net cash proceeds of $6.2 million were received in the third quarter of 2021. As a result of this transaction, a loss on sale of consolidated subsidiary of $1.1 million was recognized on the Consolidated Statements of Operations during the third quarter of 2021. TimkenSteel’s consolidated financial statements include activity for TimkenSteel (Shanghai) Corporation Limited through July 30, 2021.

Customer Program Early Termination

During the fourth quarter of 2021, TimkenSteel received communication from a customer that two specific programs would end earlier than originally forecasted. There was machinery at the St. Clair facility designed for these programs, which had no alternative use. As such, the Company recognized impairment charges of $2.4 million for the year ended December 31, 2021. Related supplies inventory of $0.2 million was also written down, which is included in cost of products sold in the Consolidated Statements of Operations, as management determined there was no alternative use.

Additionally, cash previously received from the customer as reimbursement for capital investment for these early terminated programs was amortized as an expense reduction over the term of the related programs. With the early end to these programs, the remaining amount of capital recovery to be recognized of $1.1 million was accelerated and recognized within cost of products sold on the Consolidated Statements of Operations during the fourth quarter of 2021.

In the fourth quarter of 2022, TimkenSteel received a customer reimbursement related to the initial capital investment for these early terminated programs in the net amount of $4.3 million, which is included in cost of products sold in the Consolidated Statements of Operations.
v3.22.4
Other (Income) Expense, Net
 12 Months Ended
Dec. 31, 2022
Other Income and Expenses [Abstract]  
Other (Income) Expense, Net

Note 7 - Other (Income) Expense, net

The following table provides the components of other (income) expense, net for the years ended December 31, 2022, 2021 and 2020:

 

 

Year Ended December 31,

 

 

 

2022

 

 

2021

 

 

2020

 

Pension and postretirement non-service benefit (income) loss

 

$

(20.3

)

 

$

(37.2

)

 

$

(26.6

)

Loss (gain) from remeasurement of benefit plans

 

 

(35.4

)

 

 

(20.1

)

 

 

14.7

 

Foreign currency exchange loss (gain)

 

 

(0.2

)

 

 

0.1

 

 

 

0.2

 

Insurance recoveries

 

 

(34.5

)

 

 

—

 

 

 

—

 

Sales and use tax refund

 

 

—

 

 

 

(2.5

)

 

 

—

 

Employee retention credit

 

 

—

 

 

 

—

 

 

 

(2.3

)

Miscellaneous (income) expense

 

 

(0.2

)

 

 

0.2

 

 

 

(0.2

)

Total other (income) expense, net

 

$

(90.6

)

 

$

(59.5

)

 

$

(14.2

)

 

Non-service related pension and other postretirement benefit income, for all years, consists primarily of the interest cost, expected return on plan assets and amortization components of net periodic cost.

 

The remeasurement of benefit plans is due to lump sum payments exceeding the sum of the service cost and interest cost components of the net periodic pension cost for certain plans, as well as the partial annuitization of the TimkenSteel Corporation Bargaining Unit Pension Plan ("Bargaining Plan"). The lump sum payments and partial annuitization constitute partial settlements, which are significant events requiring remeasurement of both plan assets and benefit obligations.

 

A net gain of $35.4 million from the remeasurement of these benefit plans was recognized for the year ended December 31, 2022. This gain was driven by a $359.9 million decrease in the pension liability primarily due to an increase in discount rates and a $2.7 million non-cash settlement related to the partial annuitization of the Bargaining Plan. This was partially offset by a loss of $327.2 million driven primarily by investment losses on plan assets and lump sum basis losses.

 

A net gain of $20.1 million from the remeasurement of these benefit plans was recognized for the year ended December 31, 2021. This gain was driven by a $55.7 million decrease in the pension liability primarily due to an increase in discount rates, partially offset by a loss of $35.6 million driven primarily by investment losses on plan assets.

 

For more details on the aforementioned remeasurements, refer to “Note 15 - Retirement and Postretirement Plans.”

 

During the second half of 2022, the Faircrest melt shop experienced unplanned operational downtime. During the fourth quarter of 2022, TimkenSteel recognized an insurance recovery of $33.0 million related to the unplanned downtime. Of the total recovery, $13.0 million was received in the fourth quarter of 2022 and $20.0 million was collected in the first quarter of 2023. The Company anticipates an additional insurance recovery, although the timing and amount of potential recovery are uncertain at this time. Additionally, during the third quarter of 2022, TimkenSteel recognized an insurance recovery of $1.5 million related to an unplanned outage at our Faircrest facility in November 2021. TimkenSteel recognizes an insurance recovery when it is realized or considered realizable, in accordance with the accounting guidance, and records this activity within other (income) expense, net on the Consolidated Statements of Operations.

During the second quarter of 2021, TimkenSteel received a refund from the State of Ohio related to an overpayment of sales and use taxes for the period of October 1, 2016 through September 30, 2019. This resulted in a gain recognized of $2.5 million, net of related professional fees, for the year ended December 31, 2021.

During the year ended December 31, 2020, the Company recognized a $2.3 million benefit related to the Employee Retention Credit in other (income) expense, net. For more details on this credit refer to "Note 2 - Significant Accounting Policies."
v3.22.4
Income Tax Provision
 12 Months Ended
Dec. 31, 2022
Income Tax Disclosure [Abstract]  
Income Tax Provision

Note 8 - Income Tax Provision

Income (loss) from operations before income taxes, based on geographic location of the operations to which such earnings are attributable, is provided below.

 

 

Years Ended December 31,

 

 

 

2022

 

 

2021

 

 

2020

 

United States

 

$

108.5

 

 

$

171.2

 

 

$

(64.1

)

Non-United States

 

 

(11.4

)

 

 

5.5

 

 

 

3.4

 

Income (loss) from operations before income taxes

 

$

97.1

 

 

$

176.7

 

 

$

(60.7

)

The provision (benefit) for income taxes consisted of the following:

 

 

Years Ended December 31,

 

 

 

2022

 

 

2021

 

 

2020

 

Current:

 

 

 

 

 

 

 

 

 

Federal

 

$

0.6

 

 

$

0.2

 

 

$

0.6

 

State and local

 

 

5.7

 

 

 

3.7

 

 

 

—

 

Foreign

 

 

0.8

 

 

 

0.6

 

 

 

0.5

 

Total current tax expense (benefit)

 

$

7.1

 

 

$

4.5

 

 

$

1.1

 

Deferred:

 

 

 

 

 

 

 

 

 

Federal

 

$

24.2

 

 

$

0.8

 

 

$

(0.4

)

State and local

 

 

0.7

 

 

 

0.3

 

 

 

0.5

 

Foreign

 

 

—

 

 

 

0.1

 

 

 

—

 

Total deferred tax expense (benefit)

 

 

24.9

 

 

 

1.2

 

 

 

0.1

 

Provision (benefit) for incomes taxes

 

$

32.0

 

 

$

5.7

 

 

$

1.2

 

For the year ended December 31, 2022, TimkenSteel made $0.2 million in foreign tax payments, $5.0 million in state and local tax payments, $2.0 million U.S. federal payments, and had refundable overpayments of $2.2 million related to U.S. federal, state, and local income taxes. For the year ended December 31, 2021, TimkenSteel $0.9 million in foreign tax payments, $4.6 million in state and local tax payments, no U.S. federal payments, and had no refundable overpayments of state income taxes.

The reconciliation between TimkenSteel’s effective tax rate on income (loss) from continuing operations and the statutory tax rate is as follows:

 

 

Years Ended December 31,

 

 

 

2022

 

 

2021

 

 

2020

 

U.S. federal income tax provision (benefit) at statutory rate

 

$

20.4

 

 

$

37.1

 

 

$

(12.7

)

Adjustments:

 

 

 

 

 

 

 

 

 

State and local income taxes, net of federal tax benefit

 

 

8.4

 

 

 

4.1

 

 

 

2.3

 

Permanent differences

 

 

8.9

 

 

 

(0.2

)

 

 

1.3

 

Foreign earnings taxed at different rates

 

 

(3.6

)

 

 

(0.5

)

 

 

0.1

 

Valuation allowance

 

 

(2.5

)

 

 

(34.8

)

 

 

10.3

 

U.S. research tax credit

 

 

(0.6

)

 

 

—

 

 

 

—

 

Global intangible low-taxed income

 

 

—

 

 

 

—

 

 

 

—

 

Other items, net

 

 

1.0

 

 

 

—

 

 

 

(0.1

)

Provision (benefit) for income taxes

 

$

32.0

 

 

$

5.7

 

 

$

1.2

 

Effective tax rate

 

 

32.9

%

 

 

3.2

%

 

 

(2.0

)%

Income tax expense includes U.S. and international income taxes. Except as required under U.S. tax law, U.S. income and foreign withholding taxes have not been recognized on the excess of the amount for financial reporting over the tax basis of investments in foreign subsidiaries that is indefinitely reinvested outside the U.S. This amount becomes taxable upon a repatriation of assets from the subsidiary or a sale or liquidation of the subsidiary.

The year over year increases in state and local income taxes, net of federal tax benefit is primarily related to limitations on the use of loss carryforwards in certain states. The permanent differences for the year ended December 31, 2022 are due to limitations on the tax deductibility of the loss on extinguishment of debt on the Convertible Senior Notes due 2025.

During the second and third quarters of 2021, TimkenSteel (Shanghai) Corporation Limited declared and paid dividends of $0.8 million and $0.4 million, respectively, net of withholding taxes, to TimkenSteel. During the third quarter of 2020, TimkenSteel (Shanghai) Corporation Limited declared a dividend of $5.1 million, net of withholding taxes, to TimkenSteel.

As of December 31, 2021 and 2022, there was no deferred tax liability related to undistributed earnings. The Company had recognized a deferred tax liability in the amount of $0.3 million at December 31, 2020, for undistributed earnings at its TimkenSteel (Shanghai) Corporation Limited and TimkenSteel de Mexico S. de R.C. de C.V. subsidiaries.

The effect of temporary differences giving rise to deferred tax assets and liabilities at December 31, 2022 and 2021 was as follows:

 

 

Years Ended December 31,

 

 

 

2022

 

 

2021

 

Deferred tax liabilities:

 

 

 

 

 

 

Depreciation

 

$

(81.4

)

 

$

(89.0

)

Inventory

 

 

—

 

 

 

(8.0

)

Leases - right-of-use asset

 

 

(3.1

)

 

 

(3.5

)

Deferred tax liabilities

 

$

(84.5

)

 

$

(100.5

)

Deferred tax assets:

 

 

 

 

 

 

Tax loss carryforwards

 

$

20.5

 

 

$

52.6

 

Pension and postretirement benefits

 

 

35.5

 

 

 

44.3

 

Other employee benefit accruals

 

 

6.6

 

 

 

8.2

 

Lease liability

 

 

3.1

 

 

 

3.5

 

State decoupling

 

 

0.8

 

 

 

1.3

 

Accrued restructuring

 

 

0.1

 

 

 

1.1

 

Capital loss carryforward

 

 

0.8

 

 

 

0.8

 

Intangible assets

 

 

0.2

 

 

 

0.6

 

Inventory

 

 

0.7

 

 

 

0.6

 

Allowance for doubtful accounts

 

 

0.3

 

 

 

0.5

 

Accrued Legal

 

 

2.0

 

 

 

—

 

Capitalized R&D

 

 

0.9

 

 

 

—

 

Other, net

 

 

0.1

 

 

 

0.3

 

Deferred tax assets subtotal

 

$

71.6

 

 

$

113.8

 

Valuation allowances

 

 

(13.0

)

 

 

(15.5

)

Deferred tax assets

 

 

58.6

 

 

 

98.3

 

Net deferred tax assets (liabilities)

 

$

(25.9

)

 

$

(2.2

)

As of December 31, 2022 and 2021, the Company had a deferred tax liability of $25.9 million and $2.2 million, respectively, on the Consolidated Balance Sheets. As of December 31, 2022, TimkenSteel had loss carryforwards in the U.S. and various non-U.S. jurisdictions totaling $71.7 million (of which $17.2 million relates to the U.S. and $54.5 million relates to the UK jurisdiction), having various expiration dates.

During 2016, operating losses generated in the U.S. resulted in a decrease in the carrying value of the Company’s U.S. deferred tax liability to the point that would result in a net U.S. deferred tax asset at December 31, 2016. In light of TimkenSteel’s operating performance in the U.S. and current industry conditions, the Company assessed, based upon all available evidence at the time, and concluded that it was more likely than not that it would not realize a portion of its U.S. deferred tax assets. As such, the Company recorded a valuation allowance in 2016.

Each reporting period we assess available positive and negative evidence and estimate if sufficient future taxable income will be generated to utilize the Company’s deferred tax assets. Due to TimkenSteel’s historical operating performance in the U.S., we have historically been limited in our ability to rely on other subjective evidence such as projections of our future profitability. However, as of December 31, 2022, based on consecutive years of profitability, utilization of the majority of previously generated loss carryforwards in the U.S., and forecasted future profitability, the Company released a portion of its U.S. valuation allowance. The Company maintained a domestic partial valuation allowance on a capital loss carryforward and certain state loss carryforwards that are expected to expire unused. TimkenSteel has provided a valuation allowance on the aforementioned UK loss carryforward.

The need to maintain valuation allowances against deferred tax assets in the U.S. and other affected countries may cause variability in the Company’s effective tax rate. The majority of TimkenSteel’s income taxes are derived from federal, domestic state and local taxes.

As of December 31, 2022, 2021 and 2020, TimkenSteel had no total gross unrecognized tax benefits, and no amounts which represented unrecognized tax benefits that would favorably impact TimkenSteel’s effective income tax rate in any future periods if such benefits were recognized. As of December 31, 2022, TimkenSteel does not anticipate a change in its unrecognized tax positions during the next 12 months. TimkenSteel had no accrued interest and penalties related to uncertain tax positions as of December 31, 2022, 2021 and 2020.

As of December 31, 2022, the tax years 2019 to the present remain open to examination by the IRS.
v3.22.4
Earnings (Loss) Per Share
 12 Months Ended
Dec. 31, 2022
Earnings Per Share [Abstract]  
Earnings (Loss) Per Share

Note 9 - Earnings (Loss) Per Share

 

Basic earnings (loss) per share is computed based upon the weighted average number of common shares outstanding. Diluted earnings (loss) per share is computed based upon the weighted average number of common shares outstanding plus the dilutive effect of common share equivalents calculated using the treasury stock method or if-converted method. For the Convertible Notes, the Company utilizes the if-converted method to calculate diluted earnings (loss) per share. Under the if-converted method, the Company adjusts net earnings to add back interest expense (including amortization of debt issuance costs) recognized on the Convertible Notes and includes the number of shares potentially issuable related to the Convertible Notes in the weighted average shares outstanding. Treasury stock, if any, is excluded from the denominator in calculating both basic and diluted earnings (loss) per share.

Equity-based Awards

Common share equivalents for shares issuable for equity-based awards amounted to 4.0 million shares for the year ended December 31, 2022. For the year ended December 31, 2022, 0.8 million shares were excluded from the computation of diluted earnings (loss) per share, primarily related to options with exercise prices above the average market price of our common shares (i.e., “underwater” options), because the effect of their inclusion would have been anti-dilutive. The difference between the remaining 3.2 million shares and 1.1 million shares assumed purchased with potential proceeds for the year ended December 31, 2022, were included in the denominator of the diluted earnings (loss) per share calculation.

Common share equivalents for shares issuable for equity-based awards amounted to 4.8 million shares for the year ended December 31, 2021. For the year ended December 31, 2021, 1.8 million shares were excluded from the computation of diluted earnings (loss) per share, primarily related to options with exercise prices above the average market price of our common shares (i.e., “underwater” options), because the effect of their inclusion would have been anti-dilutive. The difference between the remaining 3.0 million shares and 1.3 million shares assumed purchased with potential proceeds for the year ended December 31, 2021, were included in the denominator of the diluted earnings (loss) per share calculation.

Common share equivalents for shares issuable for equity-based awards amounted to 4.6 million shares for the year ended December 31, 2020. All common share equivalents for shares issuable for equity-based awards were excluded from the computation of diluted earnings (loss) per share for the year ended December 31, 2020, because the effect of their inclusion would have been anti-dilutive.

Convertible Notes

Common share equivalents for shares issuable upon the conversion of outstanding convertible notes of 3.6 million for the year ended December 31, 2022, were included in the computation of diluted earnings (loss) per share, as these shares would be dilutive.

During the first half of 2022, TimkenSteel repurchased $25.2 million of outstanding principal related to the Convertible Notes. These repurchases of Convertible Notes reduced weighted average diluted shares outstanding by 2.3 million shares for the year ended December 31, 2022. Refer to “Note 14 – Financing Arrangements” for additional information on the Convertible Notes.

Common share equivalents for shares issuable upon the conversion of outstanding convertible notes of 7.4 million for the year ended December 31, 2021, were included in the computation of diluted earnings (loss) per share, as these shares would be dilutive. Common share equivalents for shares issuable upon the conversion of outstanding convertible notes of 9.1 million for the year ended December 31, 2020, were excluded from the computation of diluted earnings (loss) per share because the effect of their inclusion would have been anti-dilutive.

 

The following table sets forth the reconciliation of the numerator and the denominator of basic and diluted earnings (loss) per share for the years ended December 31, 2022, 2021 and 2020:

 

 

Year Ended December 31,

 

 

 

2022

 

 

2021

 

 

2020

 

Numerator:

 

 

 

 

 

 

 

 

 

Net income (loss), basic

 

$

65.1

 

 

$

171.0

 

 

$

(61.9

)

Add convertible notes interest

 

 

1.9

 

 

 

4.1

 

 

 

—

 

Net income (loss), diluted

 

$

67.0

 

 

$

175.1

 

 

$

(61.9

)

 

 

 

 

 

 

 

 

 

 

Denominator:

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding, basic

 

 

45.8

 

 

 

45.9

 

 

 

45.0

 

Dilutive effect of equity-based awards

 

 

2.1

 

 

 

1.7

 

 

 

—

 

Dilutive effect of convertible notes

 

 

3.6

 

 

 

7.4

 

 

 

—

 

Weighted average shares outstanding, diluted

 

 

51.5

 

 

 

55.0

 

 

 

45.0

 

 

 

 

 

 

 

 

 

 

 

Basic earnings (loss) per share

 

$

1.42

 

 

$

3.73

 

 

$

(1.38

)

Diluted earnings (loss) per share

 

$

1.30

 

 

$

3.18

 

 

$

(1.38

)
v3.22.4
Inventories
 12 Months Ended
Dec. 31, 2022
Inventory Disclosure [Abstract]  
Inventories

Note 10 – Inventories

The components of inventories as of December 31, 2022 and 2021 were as follows:

 

 

December 31,

 

 

 

2022

 

 

2021

 

Manufacturing supplies

 

$

36.9

 

 

$

29.3

 

Raw materials

 

 

23.9

 

 

 

37.3

 

Work in process

 

 

94.7

 

 

 

89.3

 

Finished products

 

 

37.4

 

 

 

55.8

 

Gross inventory

 

 

192.9

 

 

 

211.7

 

Allowance for inventory reserves

 

 

(0.5

)

 

 

(0.8

)

Total inventories, net

 

$

192.4

 

 

$

210.9

 
v3.22.4
Property, Plant and Equipment
 12 Months Ended
Dec. 31, 2022
Property, Plant and Equipment [Abstract]  
Property, Plant and Equipment

Note 11 - Property, Plant and Equipment

The components of property, plant and equipment, net as of December 31, 2022 and 2021 were as follows:

 

 

December 31,

 

 

 

2022

 

 

2021

 

Land

 

$

11.2

 

 

$

11.2

 

Buildings and improvements

 

 

414.6

 

 

 

415.0

 

Machinery and equipment

 

 

1,391.5

 

 

 

1,391.9

 

Construction in progress

 

 

30.8

 

 

 

9.6

 

Subtotal

 

 

1,848.1

 

 

 

1,827.7

 

Less allowances for depreciation

 

 

(1,362.0

)

 

 

(1,317.5

)

Property, plant and equipment, net

 

$

486.1

 

 

$

510.2

 

Total depreciation expense was $55.5 million, $59.8 million, and $65.0 million for the years ended December 31, 2022, 2021, and 2020, respectively. Depreciation expense for the years ended December 31, 2021 and 2020 includes $1.5 million and $2.4 million, respectively, of accelerated depreciation related to the closure of TMS which was announced in the fourth quarter of 2019 and the discontinuation of specific small-diameter seamless mechanical tube manufacturing announced in the third quarter of 2020.

For the year ended December 31, 2022, TimkenSteel recorded a loss on sale and disposal of assets of $1.9 million primarily related to the sale of the remaining land and buildings at the Company's former TMS facility, as well as the disposition of excess and aged assets. No impairment charges were recognized in 2022.

For the year ended December 31, 2021, TimkenSteel recorded a net loss on sale of assets of $1.3 million related to the disposition of excess assets. During 2021, the Company also recorded approximately $10.6 million of impairment charges related to the indefinite idling of the Harrison melt and casting assets, the impairment of certain assets at our St. Clair facility due to the early termination of a customer program, and the disposition of assets at our former TMS facility.

For the year ended December 31, 2020, TimkenSteel recorded a net gain on the sale and disposal of assets of $2.6 million, primarily related to the sale of certain TMS assets. No impairment charges were recognized in 2020.

Supplemental cash flow information related to non-cash investing activity was as follows:

 

 

 

Year Ended December 31,

 

 

 

2022

 

 

2021

 

 

2019

 

Accrued property, plant and equipment purchases

 

$

10.6

 

 

$

3.6

 

 

$

2.0

 
v3.22.4
Intangible Assets
 12 Months Ended
Dec. 31, 2022
Goodwill and Intangible Assets Disclosure [Abstract]  
Intangible Assets

Note 12 - Intangible Assets

The components of intangible assets, net as of December 31, 2022 and 2021 were as follows:

 

 

December 31, 2022

 

 

December 31, 2021

 

 

 

Gross
Carrying
Amount

 

 

Accumulated
Amortization

 

 

Net
Carrying
Amount

 

 

Gross
Carrying
Amount

 

 

Accumulated
Amortization

 

 

Net
Carrying
Amount

 

Customer relationships

 

$

6.3

 

 

$

6.2

 

 

$

0.1

 

 

$

6.3

 

 

$

5.8

 

 

$

0.5

 

Technology use

 

 

9.0

 

 

 

9.0

 

 

 

—

 

 

 

9.0

 

 

 

9.0

 

 

 

—

 

Capitalized software

 

 

57.9

 

 

 

53.0

 

 

 

4.9

 

 

 

57.4

 

 

 

51.2

 

 

 

6.2

 

Total intangible assets

 

$

73.2

 

 

$

68.2

 

 

$

5.0

 

 

$

72.7

 

 

$

66.0

 

 

$

6.7

 

Intangible assets subject to amortization are amortized using a straight-line method over their legal or estimated useful lives. The weighted average useful lives of the customer relationships, technology use and capitalized software intangible assets are 15 years, 15 years and 6 years, respectively. The weighted average useful life of total intangible assets is 8 years as of December 31, 2022. Amortization expense for intangible assets for the years ended December 31, 2022, 2021, and 2020 was $2.8 million, $3.3 million and $5.0 million, respectively. Amortization expense in 2020 associated with capitalized software includes accelerated amortization of $1.0 million related to the closure of TMS. See “Note 6 - Disposition of Non-Core Assets” for additional information.

During the year ended December 31, 2020, TimkenSteel recorded a loss on disposal of intangible assets of $0.2 million related to capitalized software. There was no loss on disposal of intangible assets for the years ended December 31, 2022 and December 31, 2021.

Based upon the intangible assets subject to amortization as of December 31, 2022, TimkenSteel’s estimated annual amortization for the five succeeding years is shown below (in millions):

Year

 

Amortization
Expense

 

2023

 

$

2.3

 

2024

 

 

1.3

 

2025

 

 

0.3

 

2026

 

 

0.1

 

2027

 

 

0.1

 
v3.22.4
Leases
 12 Months Ended
Dec. 31, 2022
Leases [Abstract]  
Leases

Note 13 - Leases

The Company has operating leases primarily related to machinery and equipment, vehicles and information technology equipment. These leases have remaining lease terms of less than one year to approximately five years, some of which may include options to extend the lease for one or more years. Certain leases also include options to purchase the leased asset. As of December 31, 2022, the Company has no financing leases. The weighted average remaining lease term for our operating leases as of December 31, 2022 was 2.5 years.

Leases with an initial term of 12 months or less ("short-term leases") are not recorded on the balance sheet. Rather, the Company recognizes lease expense for these leases on a straight-line basis over the lease term in accordance with the applicable accounting guidance. For lease

agreements entered into after the adoption of lease accounting guidance on January 1, 2019, the Company combines lease and non-lease components. The Company’s lease agreements do not contain material residual value guarantees or material restrictive covenants.

The Company recorded lease cost for the years ended December 31, 2022, 2021 and 2020 as follows:

 

 

Year Ended December 31,

 

 

 

2022

 

 

2021

 

 

2020

 

Operating lease cost

 

$

6.7

 

 

$

8.2

 

 

$

8.8

 

Short-term lease cost

 

 

0.9

 

 

 

0.7

 

 

 

0.7

 

Total lease cost

 

$

7.6

 

 

$

8.9

 

 

$

9.5

 

When available, the rate implicit in the lease is used to discount lease payments to present value; however, the Company’s leases generally do not provide a readily determinable implicit rate. Therefore, the incremental borrowing rate to discount the lease payments is estimated using market-based information available at lease commencement. The weighted average discount rate used to measure our operating lease liabilities as of December 31, 2022 and 2021 was 3.1% and 2.7%, respectively.

Supplemental cash flow information related to leases was as follows:

 

 

Year Ended December 31,

 

 

 

2022

 

 

2021

 

 

2020

 

Cash paid for amounts included in the measurement of operating lease liabilities

 

$

6.7

 

 

$

8.2

 

 

$

8.8

 

Right-of-use assets obtained in exchange for operating lease obligations

 

$

4.5

 

 

$

3.1

 

 

$

12.5

 

Future minimum lease payments under non-cancellable leases as of December 31, 2022 were as follows:

2023

 

$

6.3

 

2024

 

 

4.0

 

2025

 

 

1.9

 

2026

 

 

0.5

 

After 2026

 

 

0.3

 

Total future minimum lease payments

 

 

13.0

 

    Less amount of lease payment representing interest

 

 

(0.5

)

Total present value of lease payments

 

$

12.5

 
v3.22.4
Financing Arrangements
 12 Months Ended
Dec. 31, 2022
Debt Disclosure [Abstract]  
Financing Arrangements

Note 14 - Financing Arrangements

The following table summarizes the current and non-current debt as of December 31, 2022 and 2021:

 

 

 

December 31,

 

 

 

2022

 

 

2021

 

Credit Agreement

 

$

—

 

 

$

—

 

Convertible Senior Notes due 2021

 

 

—

 

 

 

—

 

Convertible Senior Notes due 2025

 

 

20.4

 

 

 

44.9

 

Total debt

 

$

20.4

 

 

$

44.9

 

Less current portion of debt

 

 

20.4

 

 

 

44.9

 

Total non-current portion of debt

 

$

—

 

 

$

—

 

Amended Credit Agreement

On September 30, 2022, TimkenSteel Corporation (the “Company”), as borrower, and certain domestic subsidiaries of the Company, as subsidiary guarantors (the “Subsidiary Guarantors”), entered into a Fourth Amended and Restated Credit Agreement (the “Amended Credit Agreement”), with JPMorgan Chase Bank, N.A., as administrative agent (the “Administrative Agent”), and the lenders party thereto (collectively, the “Lenders”), which further amends and restates the Company’s existing secured Third Amended and Restated Credit Agreement, dated as of October 15, 2019.

The Amended Credit Agreement provides for a $400.0 million asset-based revolving credit facility (the “Credit Facility”), including a $15.0 million sublimit for the issuance of commercial and standby letters of credit and a $40.0 million sublimit for swingline loans. Pursuant to the terms of the Amended Credit Agreement, the Company is entitled, on up to two occasions and subject to the satisfaction of certain conditions, to request increases in the commitments under the Amended Credit Agreement in the aggregate principal amount of up to $100.0 million, to the extent that existing or new lenders agree to provide such additional commitments. In addition to and independent of any increase described in the preceding sentence, the Company is entitled, subject to the satisfaction of certain conditions, to request a separate “first-in, last-out” tranche (the “Incremental FILO Tranche”) in an aggregate principal amount of up to $30.0 million with a separate borrowing base and interest rate margins, in each case, to be agreed upon among the Company, the Administrative Agent and the Lenders providing the Incremental FILO Tranche.

The availability of borrowings under the Credit Facility is subject to a borrowing base calculation based upon a valuation of the eligible accounts receivable, inventory and machinery and equipment of the Company and the Subsidiary Guarantors, each multiplied by an applicable advance rate. The availability of borrowings may be further modified by reserves established from time to time by the Administrative Agent in its permitted discretion.

The interest rate per annum applicable to loans under the Credit Facility will be, at the Company’s option, equal to either (i) the Alternate Base Rate (as defined in the Amended Credit Agreement) plus the applicable margin or (ii) the Adjusted Term SOFR Rate (as defined in the Amended Credit Agreement) plus the applicable margin. The applicable margin will be determined by a pricing grid based on the Company’s average quarterly availability. The Alternate Base Rate is subject to a 1.00% floor, and the Adjusted Term SOFR Rate is subject to a 0.00% floor. In addition, the Company will pay a 0.25% per annum commitment fee on the average daily unused amount of the Credit Facility.

The Credit Facility may be used to finance working capital, capital expenditures, certain permitted acquisitions and for other general corporate purposes. All of the indebtedness under the Credit Facility is guaranteed by the Company’s material domestic subsidiaries, as well as any other domestic subsidiary that the Company elects to make a party to the Amended Credit Agreement, and is secured by substantially all of the personal property of the Company and the Subsidiary Guarantors.
 

The Credit Facility matures on September 30, 2027. Prior to the maturity date, amounts outstanding are required to be repaid (without reduction of the commitments thereunder) from mandatory prepayment events from the proceeds of certain asset sales, equity or debt issuances or casualty events.

 

The Amended Credit Agreement contains certain customary covenants, including covenants that limit the ability of the Company and its subsidiaries to, among other things, (i) incur or suffer to exist certain liens, (ii) make investments, (iii) incur or guaranty additional indebtedness (iv) enter into consolidations, mergers, acquisitions, sale-leaseback transactions and sales of assets, (v) make distributions and other restricted payments, (vi) change the nature of its business, (vii) engage in transactions with affiliates and (viii) enter into restrictive agreements, including agreements that restrict the ability to incur liens or make distributions.

 

In addition, the Amended Credit Agreement requires the Company to maintain a minimum specified fixed charge coverage ratio on a springing basis if minimum availability requirements as specified in the Amended Credit Agreement are not maintained.

 

The Amended Credit Agreement contains certain customary events of default. If any event of default occurs and is continuing, the Lenders would be entitled to take various actions, including the acceleration of amounts due under the Amended Credit Agreement, and exercise other rights and remedies.

 

As of December 31, 2022, the amount available under the Amended Credit Agreement was $233.5 million, reflective of the Company’s asset borrowing base with no outstanding borrowings. Additionally, the Company is in compliance with all covenants outlined in the Amended Credit Agreement.

 

Convertible Senior Notes due 2021

In May 2016, the Company issued $75.0 million aggregate principal amount of Convertible Senior Notes, and an additional $11.3 million principal amount to cover over-allotments ("Convertible Senior Notes due 2021"). The Indenture for the Convertible Senior Notes due 2021 dated May 31, 2016, which was filed with the Securities and Exchange Commission as an exhibit to a Form 8-K filed on May 31, 2016, contained a complete description of the terms of the Convertible Senior Notes due 2021. The key terms were as follows:

 

Maturity Date:

June 1, 2021 unless repurchased or converted earlier

Interest Rate:

6.0% cash interest per year

Interest Payments Dates:

June 1 and December 1 of each year, beginning on December 1, 2016

Initial Conversion Price:

$12.58 per common share of the Company

Initial Conversion Rate:

79.5165 common shares per $1,000 principal amount of Notes

 

The net proceeds to the Company from the offering were $83.2 million, after deducting the initial underwriters’ discount and fees and the offering expenses payable by the Company. The Company used the net proceeds to repay a portion of the amounts outstanding under its revolving credit agreement.

The initial value of the principal amount recorded as a liability at the date of issuance was $66.9 million, using an effective interest rate of 12.0%. The remaining $19.4 million of principal amount was allocated to the conversion feature and recorded as a component of shareholders’ equity at the date of issuance. This amount represented a discount to the debt to be amortized through interest expense using the effective interest method through the maturity of the Convertible Senior Notes due 2021.

Transaction costs were allocated to the liability and equity components based on their relative values. Transaction costs attributable to the liability component of $2.4 million were amortized to interest expense over the term of the Convertible Senior Notes due 2021, and transaction costs attributable to the equity component of $0.7 million were included in shareholders’ equity.

For more details on the accounting treatment under the adoption of ASU 2020-06, refer to “Note 2 - Significant Accounting Policies.”

Convertible Notes Exchange

In December 2020, TimkenSteel entered into separate, privately negotiated exchange agreements with a limited number of holders of the Company’s then outstanding Convertible Senior Notes due 2021. Pursuant to the exchange agreements, the Company exchanged $46.0 million aggregate principal amount of Convertible Senior Notes due 2021 for $46.0 million aggregate principal amount of its new 6.0% Convertible Senior Notes due 2025 ("Convertible Senior Notes due 2025" and, together with the Convertible Senior Notes due 2021, the "Convertible Notes"). The Company did not receive any cash proceeds from the issuance of the Convertible Senior Notes due 2025.

The Company evaluated this exchange and determined that $46.0 million of the Convertible Senior Notes due 2021 were deemed to be extinguished, as the present value of the cash flows under the terms of the Convertible Senior Notes due 2025 were at least 10 percent different from the present value of the remaining cash flows under the terms of the Convertible Senior Notes due 2021, as defined by the relevant accounting standards.

Pursuant to applicable accounting guidance, the fair value of the extinguished portion of Convertible Senior Notes due 2021 was calculated using a market rate of 9.0%, based on comparable debt instruments, and a remaining term of five and a half months. The difference between the fair value and the net carrying amount of the liability component, calculated below, was recognized on the Consolidated Statements of Operations as a loss on extinguishment of debt for the year ended December 31, 2020.

 

Net carrying amount of extinguished Convertible Senior Notes due 2021 as of December 15, 2020

 

 

 

    Principal

 

$

46.0

 

    Less: Debt issuance costs, net of amortization

 

 

(0.1

)

    Less: Debt discount, net of amortization

 

 

(1.5

)

Fair value of extinguished Convertible Senior Notes due 2021 as of December 15, 2020

 

 

45.3

 

Loss on extinguishment of debt

 

$

(0.9

)

 

The amount allocated to the reacquisition of the equity component, included as a reduction to additional paid-in capital on the Consolidated Balance Sheets, was calculated as follows:

 

Fair value of extinguished Convertible Senior Notes due 2021 as of December 15, 2020

 

$

45.3

 

Principal of extinguished Convertible Senior Notes due 2021

 

 

46.0

 

Reduction of additional paid-in capital in 2020

 

$

(0.7

)

 

The remaining accrued and unpaid interest on the $46.0 million of the extinguished Convertible Senior Notes due 2021 was paid in the amount of $0.1 million to the holders on December 15, 2020.

There was no outstanding principal amount for the Convertible Senior Notes due 2021 as of December 31, 2021, as the notes matured on June 1, 2021. The Convertible Senior Notes due 2021 were settled with a cash payment of $38.9 million and the issuance of shares of 0.1 million, as most noteholders exercised the conversion option prior to the date of maturity. For details regarding method of settlement for noteholders who exercised their conversion option prior to maturity, refer to the Indenture for the Convertible Senior Notes due 2021 filed as an exhibit to a Form 8-K on May 31, 2016. The final cash payment for interest in the amount of $1.2 million was also made to noteholders on June 1, 2021.

Convertible Senior Notes due 2025

The Convertible Senior Notes due 2025 were issued pursuant to the provisions of the indenture dated May 31, 2016, as supplemented by a supplemental indenture dated December 15, 2020, which was filed with the Securities and Exchange Commission as an exhibit to a Form 8-K on December 15, 2020. The indentures contain a complete description of the terms of the Convertible Senior Notes due 2025. The key terms are as follows:

 

Maturity Date:

December 1, 2025 unless repurchased or converted earlier

Interest Rate:

6.0% cash interest per year

Interest Payments Dates:

June 1 and December 1 of each year, beginning on December 1, 2021

Initial Conversion Price:

$7.82 per common share of the Company

Initial Conversion Rate:

127.8119 common shares per $1,000 principal amount of Notes

 

The principal amount of the Convertible Senior Notes due 2025 as of December 31, 2022 is $20.8 million. Transaction costs related to the Convertible Senior Notes due 2025 incurred upon issuance were $1.5 million. These costs are amortized to interest expense over the term of the notes. The Convertible Senior Notes due 2025 are convertible at the option of the holders in certain circumstances and during certain periods into the Company's common shares, cash, or a combination thereof, at the Company's election.

The Indenture for the Convertible Senior Notes due 2025 provides that notes will become convertible during a quarter when the share price for 20 trading days during the final 30 trading days of the immediately preceding quarter was greater than 130% of the conversion price. This criterion was met during the fourth quarter of 2022 and as such the notes can be converted at the option of the holders beginning January 1 through March 31, 2023. Whether the notes will be convertible following such period will depend on if this criterion, or another conversion condition, is met in the future. As such, the Convertible Senior Notes due 2025 are classified as a current liability on the Consolidated Balance Sheets as of December 31, 2022. This criterion was also met as of December 31, 2021. To date, no holders have elected to convert their notes during any optional conversion periods.

For details regarding all conversion mechanics and methods of settlement, refer to the Indenture for the Convertible Senior Notes due 2025 filed as an exhibit to a Form 8-K on December 15, 2020.

The components of the Convertible Senior Notes due 2025 as of December 31, 2022 and December 31, 2021 were as follows:

 

 

 

December 31,

 

 

 

2022

 

 

2021

 

Principal

 

$

20.8

 

 

$

46.0

 

Less: Debt issuance costs, net of amortization

 

 

(0.4

)

 

 

(1.1

)

Less: Debt discount, net of amortization

 

 

—

 

 

 

—

 

Convertible Senior Notes due 2025, net

 

$

20.4

 

 

$

44.9

 

 

In the first half of 2022, TimkenSteel repurchased a total of $25.2 million aggregate principal amount of its Convertible Senior Notes Due 2025. There were no repurchases related to the Convertible Notes during the second half of 2022. Total cash paid to noteholders was $67.6 million. A loss on extinguishment of debt was recognized of $43.0 million, including a charge of $0.6 million for unamortized debt issuance costs related to the portion of debt extinguished, as well as the related transaction costs.
 

Fair Value Measurement

The fair value of the Convertible Senior Notes due 2025 was approximately $53.4 million as of December 31, 2022 and $107.0 million as of December 31, 2021. The fair value of the Convertible Senior Notes due 2025, which falls within Level 2 of the fair value hierarchy as defined by applicable accounting guidance, is based on a valuation model primarily using observable market inputs and requires a recurring fair value measurement on a quarterly basis.

TimkenSteel’s Credit Facility is variable-rate debt. As such, any outstanding carrying value is a reasonable estimate of fair value as interest rates on these borrowings approximate current market rates. This valuation falls within Level 2 of the fair value hierarchy and is based on quoted prices for similar assets and liabilities in active markets that are observable either directly or indirectly. There were no outstanding borrowings on the Credit Facility as of December 31, 2022 and December 31, 2021.

Interest (income) expense, net

The following table provides the components of interest (income) expense, net for the years ended December 31, 2022, December 31, 2021 and December 31, 2020:

 

 

 

Year Ended December 31,

 

 

 

2022

 

 

2021

 

 

2020

 

Interest expense

 

$

3.9

 

 

$

6.2

 

 

$

12.6

 

Interest income

 

 

(3.3

)

 

 

(0.3

)

 

 

(0.4

)

Interest (income) expense, net

 

$

0.6

 

 

$

5.9

 

 

$

12.2

 

Interest income primarily relates to interest earned on cash invested in a money market fund and deposits with financial institutions. As of December 31, 2022, the carrying value of the Company's money market investment was $209.5 million, which approximates the fair value. The Company had no cash invested in a money market fund as of December 31, 2021 and December 31, 2020. The money market fund is a cash equivalent and is included in cash and cash equivalents on the Consolidated Balance Sheets. The fund consists of highly liquid investments with an average maturity of three months or less and falls within Level 1 of the fair value hierarchy as defined by applicable accounting guidance.

The following table sets forth total interest expense recognized specifically related to the Convertible Notes:

 

 

 

Year Ended December 31,

 

 

 

2022

 

 

2021

 

 

2020

 

Contractual interest expense

 

$

1.7

 

 

$

3.7

 

 

$

5.2

 

Amortization of debt issuance costs

 

 

0.1

 

 

 

0.4

 

 

 

0.5

 

Amortization of debt discount

 

 

—

 

 

 

—

 

 

 

4.4

 

Total

 

$

1.8

 

 

$

4.1

 

 

$

10.1

 

The total cash interest paid for the year ended December 31, 2022 , 2021, and 2020 was $3.1 million, $5.1 million and $7.6 million, respectively.

 

Treasury Shares

On December 20, 2021, TimkenSteel announced that its Board of Directors authorized a share repurchase program under which the Company may repurchase up to $50.0 million of its outstanding common shares. The share repurchase program is intended to return capital to shareholders while also offsetting dilution from annual equity compensation awards. The share repurchase program does not require the Company to acquire any dollar amount or number of shares and may be modified, suspended, extended or terminated by the Company at any time without prior notice.

On November 2, 2022, the Board of Directors authorized an additional $75.0 million share repurchase program. This authorization reflects the continued confidence of the Board and senior leadership in the Company’s ability to generate sustainable through-cycle profitability while maintaining a strong balance sheet and cash flow.

For the year ended December 31, 2022, the Company repurchased approximately 3.0 million common shares in the open market at an aggregate cost of $52.0 million, which equates to an average repurchase price of $17.18 per share. As of December 31, 2022, the Company had a balance of $73.0 million remaining under its share repurchase program. The Company did not repurchase shares during the years ended December 31, 2021 or December 31, 2020.

Subsequent to December 31, 2022, the Company repurchased 0.2 million additional common shares in the open market at an aggregate cost of $4.5 million, which equates to an average repurchase price of $19.19 per share. As of February 24, 2023, the Company has $68.5 million remaining under its authorized share repurchase program.
v3.22.4
Retirement and Postretirement Plans
 12 Months Ended
Dec. 31, 2022
Defined Benefit Plans and Other Postretirement Benefit Plans Disclosures [Abstract]  
Retirement and Postretirement Plans

Note 15 - Retirement and Postretirement Plans

Eligible TimkenSteel employees, including certain employees in foreign countries, participate in the following TimkenSteel-sponsored plans: TimkenSteel Corporation Retirement Plan ("Salaried Plan"); TimkenSteel Corporation Bargaining Unit Pension Plan ("Bargaining Plan"), Supplemental Pension Plan of TimkenSteel Corporation ("Supplemental Plan"), TimkenSteel U.K. Pension Scheme ("Pension Scheme"), Mexico Pension Plan, and Postretirement Plans made up of TimkenSteel Corporation Bargaining Unit Welfare Benefit Plan for Retirees and TimkenSteel Corporation Welfare Benefit Plan for Retirees.

Bargaining Plan

On October 29, 2021, the United Steelworkers ("USW") Local 1123 voted to ratify a new four-year contract (the “Contract”). The Contract is in effect until September 27, 2025 and resulted in several changes to the Bargaining Plan which increased the pension liability by $14.2 million in 2021. These plan amendments were recognized in other comprehensive income (loss) in 2021 and will be amortized as part of the pension net periodic benefit cost in future periods. The main change that drove the increase in the pension liability was the addition of a full lump sum form of payment for participants commencing benefits on or after January 1, 2022. In addition, the plan is now closed to new entrants effective January 1, 2022.

On July 7, 2022, the Company entered into an agreement with The Prudential Insurance Company of America ("Prudential") to purchase an irrevocable group annuity contract and transfer approximately $256.2 million of pension obligations under the Bargaining Plan. In connection with the agreement, Prudential began paying benefits under the group annuity contract as of October 1, 2022 for a specified group of approximately 1,900 participants and beneficiaries who previously received payments from the Bargaining Plan. Benefits payable to these participants and beneficiaries were not reduced as a result of this transaction. Plan participants and beneficiaries not included in the transaction remain in the Bargaining Plan. The Company recorded a non-cash settlement gain of approximately $2.7 million in the third quarter of 2022 related to this partial plan annuitization. This settlement is a significant event which also required remeasurement of the Bargaining Plan during the third quarter. The transaction was funded directly by the assets of the Bargaining Plan and required no cash contribution from the Company.

The timing and amount of future required pension contributions is significantly affected by asset returns and actuarial assumptions. Plan asset losses in 2022, combined with current actuarial assumptions, have resulted in potentially accelerated timing of future required pension contributions to as early as 2024. Required future pension contribution timing and amounts are subject to significant change based on future investment performance, Company estimates and actuarial assumptions, as well as current funding laws.

Salaried Plan

During the fourth quarter of 2021, termination of the Salaried Plan was approved by the TimkenSteel Board of Directors. Participants were notified in January 2022 and the plan was terminated effective March 31, 2022, subject to regulatory approval. The purchase of an irrevocable annuity contract from an insurance company is expected to occur in 2023, after which time the insurance company selected will be responsible for all participant benefit payments.

 

Supplemental Plan

During the fourth quarter of 2019, the Company amended the Supplemental Plan, which provides for the payment of nonqualified supplemental pension benefits to certain salaried participants in the Salaried Plan. The amendment provides for the cessation of benefit accruals under the Supplemental Plan, effective as of December 31, 2020. Effective January 1, 2021, there were no new accruals of benefits, including with respect to service accruals and the final average compensation determination. Certain of the Company’s current and prior named executive officers are participants in the plan. Existing benefits under the plan, as of December 31, 2020, will otherwise continue in accordance with the terms of the plan.

Postretirement Plans

During the second quarter of 2019, the Company amended the TimkenSteel Corporation Bargaining Unit Welfare Plan for Retirees related to moving Medicare-eligible retirees to an individual plan on a Medicare healthcare exchange.

During the fourth quarter of 2019, the Company also amended the TimkenSteel Corporation Welfare Benefit Plan for Retirees, under which certain retired salaried employees of the Company and its subsidiaries are eligible to receive a Company contribution for their medical and prescription drug benefits under the retiree welfare plan. The amendment eliminated the retiree medical subsidy, effective as of December 31, 2019, for all remaining active salaried participants who retire after December 31, 2019 (provided, however, that participants who were laid off on or before March 31, 2020 and who otherwise qualified for the retiree medical subsidy under the terms of the retiree welfare plan remained entitled to receive the retiree medical subsidy).

Pension benefits earned are generally based on years of service and compensation during active employment. TimkenSteel’s funding policy is consistent with the funding requirements of applicable laws and regulations. Asset allocations are established in a manner consistent with projected plan liabilities, benefit payments and expected rates of return for the various asset classes. The expected rate of return for the investment portfolio is based on expected rates of return for various asset classes, as well as historical asset class and fund performance.

The following table sets forth the change in benefit obligation for the pension and postretirement benefit plans as of December 31, 2022:
 

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

Change in benefit obligation:

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

 

Pension
Scheme

 

 

Pension
Plan

 

 

Total
Pension

 

 

Postretirement
Plans

 

Benefit obligation at the beginning of year

 

$

1,025.4

 

 

$

187.4

 

 

$

23.6

 

 

$

82.4

 

 

$

0.4

 

 

$

1,319.2

 

 

$

117.8

 

Service cost

 

 

13.9

 

 

 

0.3

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

14.2

 

 

 

1.1

 

Interest cost

 

 

31.1

 

 

 

6.5

 

 

 

0.7

 

 

 

1.3

 

 

 

—

 

 

 

39.6

 

 

 

3.4

 

Actuarial (gains) losses

 

 

(203.6

)

 

 

(34.0

)

 

 

(6.5

)

 

 

(25.3

)

 

 

—

 

 

 

(269.4

)

 

 

(24.0

)

Benefits paid

 

 

(51.0

)

 

 

(11.6

)

 

 

(0.6

)

 

 

(2.5

)

 

 

—

 

 

 

(65.7

)

 

 

(10.9

)

Settlements

 

 

(340.9

)

 

 

(20.5

)

 

 

(1.7

)

 

 

—

 

 

 

—

 

 

 

(363.1

)

 

 

—

 

Foreign currency translation adjustment

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(8.2

)

 

 

—

 

 

 

(8.2

)

 

 

—

 

Benefit obligation at the end of year

 

$

474.9

 

 

$

128.1

 

 

$

15.5

 

 

$

47.7

 

 

$

0.4

 

 

$

666.6

 

 

$

87.4

 

Significant actuarial gains related to changes in benefit obligations for 2022 primarily resulted from an increase in discount rates. Significant settlements were a result of the Bargaining Plan annuity purchase as well as lump sum payments during 2022.

The following table sets forth the change in benefit obligation for the pension and postretirement benefit plans as of December 31, 2021:

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

Change in benefit obligation:

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

 

Pension
Scheme

 

 

Pension
Plan

 

 

Total
Pension

 

 

Postretirement
Plans

 

Benefit obligation at the beginning of year

 

$

1,053.9

 

 

$

228.7

 

 

$

27.3

 

 

$

84.8

 

 

$

0.4

 

 

$

1,395.1

 

 

$

128.3

 

Service cost

 

 

17.0

 

 

 

0.4

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

17.4

 

 

 

1.2

 

Interest cost

 

 

28.4

 

 

 

5.9

 

 

 

0.8

 

 

 

1.1

 

 

 

—

 

 

 

36.2

 

 

 

3.2

 

Actuarial (gains) losses

 

 

(31.6

)

 

 

(5.1

)

 

 

(1.5

)

 

 

0.3

 

 

 

—

 

 

 

(37.9

)

 

 

(6.0

)

Benefits paid

 

 

(56.5

)

 

 

(11.4

)

 

 

(3.0

)

 

 

(3.0

)

 

 

—

 

 

 

(73.9

)

 

 

(8.9

)

Plan amendment

 

 

14.2

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

14.2

 

 

 

—

 

Settlements

 

 

—

 

 

 

(31.1

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(31.1

)

 

 

—

 

Foreign currency translation adjustment

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(0.8

)

 

 

—

 

 

 

(0.8

)

 

 

—

 

Benefit obligation at the end of year

 

$

1,025.4

 

 

$

187.4

 

 

$

23.6

 

 

$

82.4

 

 

$

0.4

 

 

$

1,319.2

 

 

$

117.8

 

Significant actuarial gains related to changes in benefit obligations for 2021 primarily resulted from an increase in discount rates.

The following table sets forth the change in plan assets and funded status for the pension and postretirement benefit plan as of December 31, 2022:

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

Change in plan assets:

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

 

Pension
Scheme

 

 

Pension
Plan

 

 

Total
Pension

 

 

Postretirement
Plans

 

Fair value of plan assets at the beginning of year

 

$

862.8

 

 

$

205.7

 

 

$

—

 

 

$

107.2

 

 

$

0.3

 

 

$

1,176.0

 

 

$

76.8

 

Actual return on plan assets

 

 

(119.7

)

 

 

(35.9

)

 

 

—

 

 

 

(38.0

)

 

 

—

 

 

 

(193.6

)

 

 

(8.8

)

Company contributions / payments

 

 

—

 

 

 

—

 

 

 

2.3

 

 

 

1.3

 

 

 

—

 

 

 

3.6

 

 

 

2.1

 

Benefits paid

 

 

(51.0

)

 

 

(11.6

)

 

 

(0.6

)

 

 

(2.5

)

 

 

—

 

 

 

(65.7

)

 

 

(10.9

)

Settlements

 

 

(338.2

)

 

 

(20.5

)

 

 

(1.7

)

 

 

—

 

 

 

—

 

 

 

(360.4

)

 

 

—

 

Foreign currency translation adjustment

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(10.5

)

 

 

—

 

 

 

(10.5

)

 

 

—

 

Fair value of plan assets at end of year

 

$

353.9

 

 

$

137.7

 

 

$

—

 

 

$

57.5

 

 

$

0.3

 

 

$

549.4

 

 

$

59.2

 

Funded status at end of year

 

$

(121.0

)

 

$

9.6

 

 

$

(15.5

)

 

$

9.8

 

 

$

(0.1

)

 

$

(117.2

)

 

$

(28.2

)

 

The following table sets forth the change in plan assets and funded status for the pension and postretirement benefit plan as of December 31, 2021:

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

Change in plan assets:

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

 

Pension
Scheme

 

 

Pension
Plan

 

 

Total
Pension

 

 

Postretirement
Plans

 

Fair value of plan assets at the beginning of year

 

$

884.3

 

 

$

243.3

 

 

$

—

 

 

$

103.8

 

 

$

0.3

 

 

$

1,231.7

 

 

$

82.2

 

Actual return on plan assets

 

 

35.0

 

 

 

4.9

 

 

 

—

 

 

 

4.7

 

 

 

—

 

 

 

44.6

 

 

 

2.4

 

Company contributions / payments

 

 

—

 

 

 

—

 

 

 

3.0

 

 

 

2.8

 

 

 

—

 

 

 

5.8

 

 

 

1.1

 

Benefits paid

 

 

(56.5

)

 

 

(11.4

)

 

 

(3.0

)

 

 

(3.0

)

 

 

—

 

 

 

(73.9

)

 

 

(8.9

)

Settlements

 

 

—

 

 

 

(31.1

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(31.1

)

 

 

—

 

Foreign currency translation adjustment

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(1.1

)

 

 

—

 

 

 

(1.1

)

 

 

—

 

Fair value of plan assets at end of year

 

$

862.8

 

 

$

205.7

 

 

$

—

 

 

$

107.2

 

 

$

0.3

 

 

$

1,176.0

 

 

$

76.8

 

Funded status at end of year

 

$

(162.6

)

 

$

18.3

 

 

$

(23.6

)

 

$

24.8

 

 

$

(0.1

)

 

$

(143.2

)

 

$

(41.0

)

The Bargaining Plan, Salaried Plan, and Supplemental Plan have a provision that permits employees to elect to receive their pension benefits in a lump sum upon retirement. The Company's accounting policy is to recognize settlements during the quarter in which it is projected that the costs of all settlements during the year will be greater than the sum of the service cost and intertest cost components.

In the first quarter of 2022, the cumulative cost of all lump sum payments exceeded this threshold for the Supplemental Plan. Additionally, in the first quarter of 2022, the cumulative costs of all lump sum payments were projected to exceed this threshold during 2022 for the Salaried Plan. These costs did ultimately exceed this threshold for the Salaried Plan during the second quarter of 2022. Also, during the second quarter of 2022, the cumulative costs of all lump sum payments were projected to exceed this threshold in 2022 for the Bargaining Plan. These costs did ultimately exceed this threshold for the Bargaining Plan during the third quarter of 2022.

These payments constitute a partial settlement, which is a significant event requiring remeasurement of both plan assets and benefit obligations. As a result, the Company completed a full remeasurement of its pension obligations and plan assets associated with the Supplemental Plan during the first quarter of 2022. No further remeasurement was required in 2022 related to the Supplemental Plan, as no further lump sum payments have been made. The Salaried Plan's pension obligations and plan assets were remeasured during each quarter of 2022. We also completed a full remeasurement of the Bargaining Plan's pension obligations and plan assets during the second, third, and fourth quarters of 2022.

A full remeasurement of the pension obligations and plan assets associated with the Salaried Plan was also required throughout each quarter of 2021. For the years ended December 31, 2022 and December 31, 2021, total settlements were $363.1 million and $31.1 million, respectively. These settlements are included in the tables above. Lump sum payments are reflected in the net remeasurement losses (gains) as a component of net periodic benefit cost. The annuity purchase for the Bargaining Plan that occurred in 2022 is included in the settlements component of net periodic benefit cost.

For the years ended December 31, 2022 and 2021, all pension plans had administrative expenses of $5.1 million and $3.0 million, respectively. These expenses are included in benefits paid in the tables above.

The accumulated benefit obligation at December 31, 2022 exceeded the fair value of plan assets for the Bargaining Plan and the unfunded Supplemental Plan. For the Bargaining Plan and Supplemental Plan, the accumulated benefit obligation was $468.9 million and $15.7 million, respectively, as of December 31, 2022.

The total pension accumulated benefit obligation for all plans was $660.6 million and $1,303.2 million as of December 31, 2022 and 2021, respectively.

Amounts recognized on the balance sheet at December 31, 2022 for TimkenSteel’s pension and postretirement benefit plans include:

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

 

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

 

Pension
Scheme

 

 

Pension
Plan

 

 

Total
Pension

 

 

Postretirement
Plans

 

Non-current assets

 

$

—

 

 

$

9.6

 

 

$

—

 

 

$

9.8

 

 

$

—

 

 

$

19.4

 

 

$

—

 

Current liabilities

 

 

—

 

 

 

—

 

 

 

(0.6

)

 

 

—

 

 

 

—

 

 

 

(0.6

)

 

 

(1.4

)

Non-current liabilities

 

 

(121.0

)

 

 

—

 

 

 

(15.0

)

 

 

—

 

 

 

(0.1

)

 

 

(136.1

)

 

 

(26.8

)

Total

 

$

(121.0

)

 

$

9.6

 

 

$

(15.6

)

 

$

9.8

 

 

$

(0.1

)

 

$

(117.3

)

 

$

(28.2

)

Amounts recognized on the balance sheet at December 31, 2021 for TimkenSteel’s pension and postretirement benefit plans include:

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

 

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

 

Pension
Scheme

 

 

Pension
Plan

 

 

Total
Pension

 

 

Postretirement
Plans

 

Non-current assets

 

$

—

 

 

$

18.3

 

 

$

—

 

 

$

24.8

 

 

$

—

 

 

$

43.1

 

 

$

—

 

Current liabilities

 

 

—

 

 

 

—

 

 

 

(2.6

)

 

 

—

 

 

 

—

 

 

 

(2.6

)

 

 

(1.7

)

Non-current liabilities

 

 

(162.6

)

 

 

—

 

 

 

(21.0

)

 

 

—

 

 

 

(0.1

)

 

 

(183.7

)

 

 

(39.3

)

Total

 

$

(162.6

)

 

$

18.3

 

 

$

(23.6

)

 

$

24.8

 

 

$

(0.1

)

 

$

(143.2

)

 

$

(41.0

)

Included in accumulated other comprehensive income (loss) at December 31, 2022 were the following before-tax amounts that had not been recognized in net periodic benefit cost:

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

 

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

 

Pension
Scheme

 

 

Pension
Plan

 

 

Total
Pension

 

 

Postretirement
Plans

 

Unrecognized prior service (benefit) cost

 

$

12.4

 

 

$

—

 

 

$

—

 

 

$

0.5

 

 

$

—

 

 

$

12.9

 

 

$

(49.9

)

Included in accumulated other comprehensive income (loss) at December 31, 2021 were the following before-tax amounts that had not been recognized in net periodic benefit cost:

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

 

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

 

Pension
Scheme

 

 

Pension
Plan

 

 

Total
Pension

 

 

Postretirement
Plans

 

Unrecognized prior service (benefit) cost

 

$

13.6

 

 

$

—

 

 

$

—

 

 

$

0.6

 

 

$

—

 

 

$

14.2

 

 

$

(55.9

)

The weighted average assumptions used in determining benefit obligation as of December 31, 2022 and 2021 were as follows:

 

 

Pension

 

 

Postretirement

 

Assumptions:

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Discount rate

 

 

5.61

%

 

 

2.96

%

 

 

5.70

%

 

 

3.00

%

Future compensation assumption

 

 

3.00

%

 

 

3.00

%

 

n/a

 

 

n/a

 

The weighted average assumptions used in determining benefit cost for the years ended December 31, 2022 and 2021 were as follows:

 

 

 

Pension

 

 

Postretirement

 

Assumptions:

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Discount rate

 

 

2.96

%

 

 

2.68

%

 

 

3.00

%

 

 

2.65

%

Future compensation assumption

 

 

3.00

%

 

 

2.29

%

 

n/a

 

 

n/a

 

Expected long-term return on plan assets

 

 

5.96

%

 

 

5.76

%

 

 

4.75

%

 

 

4.50

%

 

The discount rate assumption is based on current rates of high-quality long-term corporate bonds over the same period that benefit payments will be required to be made. The expected rate of return on plan assets assumption is based on the weighted-average expected return on the various asset classes in the plans’ portfolios. The asset class return is developed using historical asset return performance as well as current market conditions such as inflation, interest rates and equity market performance.

For measurement purposes, TimkenSteel assumed a weighted-average annual rate of increase in the per capita cost ("health care cost trend rate") of 10.00% for 2021. This weighted-average annual rate of increase was not applicable in 2022.

The components of net periodic benefit cost (income) for the year ended December 31, 2022 were as follows:

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

Components of net periodic benefit cost (income):

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

 

Pension
Scheme

 

 

Pension
Plan

 

 

Total
Pension

 

 

Postretirement
Plans

 

Service cost

 

$

13.9

 

 

$

0.3

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

14.2

 

 

$

1.1

 

Interest cost

 

 

31.1

 

 

 

6.5

 

 

 

0.7

 

 

 

1.3

 

 

 

—

 

 

 

39.6

 

 

 

3.4

 

Expected return on plan assets

 

 

(46.7

)

 

 

(5.0

)

 

 

—

 

 

 

(3.2

)

 

 

—

 

 

 

(54.9

)

 

 

(3.4

)

Amortization of prior service cost

 

 

1.3

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

1.3

 

 

 

(6.0

)

Settlements

 

 

(2.7

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(2.7

)

 

 

—

 

Net remeasurement losses (gains)

 

 

(37.2

)

 

 

6.9

 

 

 

(6.5

)

 

 

15.9

 

 

 

—

 

 

 

(20.9

)

 

 

(11.8

)

Net Periodic Benefit Cost (Income)

 

$

(40.3

)

 

$

8.7

 

 

$

(5.8

)

 

$

14.0

 

 

$

—

 

 

$

(23.4

)

 

$

(16.7

)

The components of net periodic benefit cost (income) for the year ended December 31, 2021 were as follows:

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

Components of net periodic benefit cost (income):

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

 

Pension
Scheme

 

 

Pension
Plan

 

 

Total
Pension

 

 

Postretirement
Plans

 

Service cost

 

$

17.0

 

 

$

0.4

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

17.4

 

 

$

1.2

 

Interest cost

 

 

28.4

 

 

 

5.9

 

 

 

0.8

 

 

 

1.1

 

 

 

—

 

 

 

36.2

 

 

 

3.2

 

Expected return on plan assets

 

 

(51.5

)

 

 

(12.6

)

 

 

—

 

 

 

(3.3

)

 

 

—

 

 

 

(67.4

)

 

 

(3.4

)

Amortization of prior service cost

 

 

0.2

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

0.2

 

 

 

(6.0

)

Curtailment

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Net remeasurement losses (gains)

 

 

(15.1

)

 

 

2.5

 

 

 

(1.5

)

 

 

(1.1

)

 

 

—

 

 

 

(15.2

)

 

 

(4.9

)

Net Periodic Benefit Cost (Income)

 

$

(21.0

)

 

$

(3.8

)

 

$

(0.7

)

 

$

(3.3

)

 

$

—

 

 

$

(28.8

)

 

$

(9.9

)

 

The components of net periodic benefit cost (income) for the year ended December 31, 2020 were as follows:

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

Components of net periodic benefit cost (income):

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

 

Pension
Scheme

 

 

Pension
Plan

 

 

Total
Pension

 

 

Postretirement
Plans

 

Service cost

 

$

16.9

 

 

$

2.5

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

19.4

 

 

$

1.0

 

Interest cost

 

 

33.3

 

 

 

7.0

 

 

 

0.9

 

 

 

1.5

 

 

 

—

 

 

 

42.7

 

 

 

4.2

 

Expected return on plan assets

 

 

(47.5

)

 

 

(13.5

)

 

 

—

 

 

 

(3.3

)

 

 

—

 

 

 

(64.3

)

 

 

(3.5

)

Amortization of prior service cost

 

 

0.3

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

0.3

 

 

 

(6.0

)

Curtailment

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Net remeasurement losses (gains)

 

 

10.8

 

 

 

(1.0

)

 

 

1.8

 

 

 

0.4

 

 

 

0.1

 

 

 

12.1

 

 

 

2.6

 

Net Periodic Benefit Cost (Income)

 

$

13.8

 

 

$

(5.0

)

 

$

2.7

 

 

$

(1.4

)

 

$

0.1

 

 

$

10.2

 

 

$

(1.7

)

TimkenSteel recognizes its overall responsibility to ensure that the assets of its various defined benefit pension plans are managed effectively and prudently and in compliance with its policy guidelines and all applicable laws. Preservation of capital is important; however, TimkenSteel also recognizes that appropriate levels of risk are necessary to allow its investment managers to achieve satisfactory long-term results consistent with the objectives and the fiduciary character of the pension funds. Asset allocations are established in a manner consistent with projected plan liabilities, benefit payments and expected rates of return for various asset classes. The expected rate of return for the investment portfolios is based on expected rates of return for various asset classes, as well as historical asset class and fund performance.

The target allocations for each plan's assets are as follows:

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

Target Allocations:

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

Pension
Scheme

 

 

Pension
Plan

 

 

Weighted
Average
Pension

 

 

Postretirement
Plans

 

Equity securities

 

 

35.0

%

 

 

—

 

 

n/a

 

 

16.7

%

 

 

—

 

 

 

24.3

%

 

 

20.0

%

Debt securities

 

 

44.0

%

 

 

100.0

%

 

n/a

 

 

66.6

%

 

 

100.0

%

 

 

60.4

%

 

 

77.5

%

Other investments

 

 

21.0

%

 

 

—

 

 

n/a

 

 

16.7

%

 

 

—

 

 

 

15.3

%

 

 

2.5

%

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date ("exit price"). The inputs used to measure fair value are classified into the following hierarchy:

Level 1 - Unadjusted quoted prices in active markets for identical assets or liabilities.

Level 2 - Unadjusted quoted prices in active markets for similar assets or liabilities, or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability.

Level 3 - Unobservable inputs for the asset or liability.

The following table presents the fair value hierarchy for those investments of TimkenSteel’s pension assets measured at fair value on a recurring basis as of December 31, 2022:

 

 

Total

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

58.4

 

 

$

3.0

 

 

$

55.4

 

 

$

—

 

U.S government and agency securities

 

 

53.7

 

 

 

49.4

 

 

 

4.3

 

 

 

—

 

Corporate bonds

 

 

113.0

 

 

 

—

 

 

 

113.0

 

 

 

—

 

Equity securities

 

 

14.5

 

 

 

14.5

 

 

 

—

 

 

 

—

 

Real estate

 

 

7.6

 

 

 

—

 

 

 

—

 

 

 

7.6

 

Private debt

 

 

18.8

 

 

 

—

 

 

 

—

 

 

 

18.8

 

Total Assets in the fair value hierarchy

 

$

266.0

 

 

$

66.9

 

 

$

172.7

 

 

$

26.4

 

Assets measured at net asset value (1)

 

 

283.4

 

 

 

—

 

 

 

—

 

 

 

—

 

Total Assets

 

$

549.4

 

 

$

66.9

 

 

$

172.7

 

 

$

26.4

 


(1) Certain assets that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. Such assets include common collective trusts that invest in equity securities and fixed income securities, limited partnerships, real estate partnerships, and hedge funds. As of December 31, 2022, these assets are redeemable at net asset value within 90 days, except for certain private investments with an estimated liquidation period of one to ten years.

The following table presents the fair value hierarchy for those investments of TimkenSteel’s pension assets measured at fair value on a recurring basis as of December 31, 2021:

 

 

Total

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

87.6

 

 

$

1.2

 

 

$

86.4

 

 

$

—

 

U.S government and agency securities

 

 

173.9

 

 

 

166.7

 

 

 

7.2

 

 

 

—

 

Corporate bonds

 

 

244.7

 

 

 

—

 

 

 

244.7

 

 

 

—

 

Equity securities

 

 

25.3

 

 

 

25.3

 

 

 

—

 

 

 

—

 

Other

 

 

0.3

 

 

 

—

 

 

 

0.3

 

 

 

—

 

Total Assets in the fair value hierarchy

 

$

531.8

 

 

$

193.2

 

 

$

338.6

 

 

$

—

 

Assets measured at net asset value (1)

 

 

644.2

 

 

 

—

 

 

 

—

 

 

 

—

 

Total Assets

 

$

1,176.0

 

 

$

193.2

 

 

$

338.6

 

 

$

—

 


(1) Certain assets that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. Such assets include common collective trusts that invest in equity securities and fixed income securities, limited partnerships, real estate partnerships, and hedge funds. As of December 31, 2021, these assets were redeemable at net asset value within 90 days.

The following table sets forth a summary of changes in the fair value of TimkenSteel's pension plan level three assets for the year ended December 31, 2022:

 

 

Level 3 assets only

 

 

 

2022

 

Balance at the beginning of year

 

$

—

 

Transfers in and/or out of Level 3

 

 

—

 

Actual return on plan assets:

 

 

 

Realized gain (loss)

 

 

0.4

 

Net unrealized gain (loss)

 

 

0.1

 

Purchases, sales, issuances and settlements:

 

 

 

Purchases

 

 

31.4

 

Sales

 

 

(5.5

)

Balance at the end of year

 

$

26.4

 

 

The following table presents the fair value hierarchy for those investments of TimkenSteel’s postretirement assets measured at fair value on a recurring basis as of December 31, 2022:

 

 

Total

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

1.4

 

 

$

1.4

 

 

$

—

 

 

$

—

 

Mutual fund - fixed income

 

 

4.7

 

 

 

4.7

 

 

 

—

 

 

 

—

 

Total Assets in the fair value hierarchy

 

$

6.1

 

 

$

6.1

 

 

$

—

 

 

$

—

 

Assets measured at net asset value (1)

 

 

53.1

 

 

 

—

 

 

 

—

 

 

 

—

 

Total Assets

 

$

59.2

 

 

$

6.1

 

 

$

—

 

 

$

—

 


(1) Certain assets that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. Such assets include common collective trusts that invest in equity securities and fixed income securities. As of December 31, 2022, these assets are redeemable at net asset value within 90 days.

The following table presents the fair value hierarchy for those investments of TimkenSteel’s postretirement assets measured at fair value on a recurring basis as of December 31, 2021:

 

 

Total

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

3.8

 

 

$

3.8

 

 

$

—

 

 

$

—

 

Mutual fund - fixed income

 

 

5.8

 

 

 

5.8

 

 

 

—

 

 

 

—

 

Total Assets in the fair value hierarchy

 

$

9.6

 

 

$

9.6

 

 

$

—

 

 

$

—

 

Assets measured at net asset value (1)

 

 

67.2

 

 

 

—

 

 

 

—

 

 

 

—

 

Total Assets

 

$

76.8

 

 

$

9.6

 

 

$

—

 

 

$

—

 


(1) Certain assets that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. Such assets include common collective trusts that invest in equity securities, fixed income securities, and limited partnerships. As of December 31, 2021, these assets were redeemable at net asset value within 90 days.

Future benefit payments are expected to be as follows:

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

Benefit Payments:

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

 

Pension
Scheme

 

 

Pension
Plan

 

 

Total
Pension

 

 

Postretirement
Plans

 

2023

 

$

36.3

 

 

$

13.3

 

 

$

0.6

 

 

$

2.1

 

 

$

—

 

 

$

52.3

 

 

$

10.1

 

2024

 

 

36.9

 

 

 

13.3

 

 

 

0.6

 

 

 

2.2

 

 

 

—

 

 

 

53.0

 

 

 

9.1

 

2025

 

 

39.1

 

 

 

12.3

 

 

 

0.5

 

 

 

2.3

 

 

 

—

 

 

 

54.2

 

 

 

8.5

 

2026

 

 

41.8

 

 

 

11.7

 

 

 

0.5

 

 

 

2.2

 

 

 

—

 

 

 

56.2

 

 

 

8.0

 

2027

 

 

46.3

 

 

 

11.3

 

 

 

13.4

 

 

 

2.3

 

 

 

—

 

 

 

73.3

 

 

 

7.7

 

2028-2032

 

 

214.1

 

 

 

49.8

 

 

 

2.1

 

 

 

12.3

 

 

 

0.6

 

 

 

278.9

 

 

 

34.3

 

The Company expects to make required contributions and payments to its pension and postretirement plans of $3.2 million in the next 12 months and $224.8 million from 2024 through 2032.

Required Company contributions related to the Bargaining Plan are projected to begin in 2024 based on current forecasts. As such, all Bargaining Plan benefit payments noted above are anticipated to be made from plan assets.

Defined Contribution Plans

The Company recorded expense primarily related to employer matching and non-discretionary contributions to these defined contribution plans of $3.3 million in 2022, $2.8 million in 2021, and $3.2 million in 2020. Effective June 1, 2020, the Company suspended employer

matching contributions for all salaried employees. The Company reinstated employer matching contributions effective March 1, 2021. Additionally, the Company discontinued non-discretionary contributions as of January 1, 2021.
v3.22.4
Stock-Based Compensation
 12 Months Ended
Dec. 31, 2022
Share-Based Payment Arrangement [Abstract]  
Stock-Based Compensation

Note 16 - Stock-Based Compensation

Description of the Plan

On May 6, 2020, shareholders of TimkenSteel approved the TimkenSteel Corporation 2020 Equity and Incentive Compensation Plan ("TimkenSteel 2020 Plan"), which replaced the previously approved TimkenSteel Corporation Amended and Restated 2014 Equity and Incentive Compensation Plan ("TimkenSteel 2014 Plan"). The TimkenSteel 2020 Plan authorizes the Compensation Committee to provide cash awards and equity-based compensation in the form of stock options, stock appreciation rights, restricted shares, restricted share units, performance shares, performance units, dividend equivalents, and certain other awards for the primary purpose of providing our employees, officers and directors incentives and rewards for service and/or performance. Subject to adjustment as described in the TimkenSteel 2020 Plan, and subject to the TimkenSteel 2020 Plan share counting rules, a total of 2.0 million common shares of the Company are available for awards granted under the TimkenSteel 2020 Plan (plus shares subject to awards granted under the TimkenSteel 2020 Plan or the TimkenSteel 2014 Plan that are canceled or forfeited, expire, are settled for cash, or are unearned to the extent of such cancellation, forfeiture, expiration, cash settlement or unearned amount, as further described in the TimkenSteel 2020 Plan). These shares may be shares of original issuance or treasury shares, or a combination of both. The aggregate number of shares available under the TimkenSteel 2020 Plan will generally be reduced by one common share for every one share subject to an award granted under the TimkenSteel 2020 Plan. The TimkenSteel 2020 Plan also provides that, subject to adjustment as described in the TimkenSteel 2020 Plan: (1) the aggregate number of common shares actually issued or transferred upon the exercise of incentive stock options will not exceed 2.0 million common shares; and (2) no non-employee director of the Company will be granted, in any period of one calendar year, compensation for such service having an aggregate maximum value (measured at the grant date as applicable, and calculating the value of any awards based on the grant date fair value for financial reporting purposes) in excess of $0.5 million.

 

On May 5, 2021, shareholders approved the TimkenSteel Corporation Amended and Restated 2020 Equity and Incentive Compensation Plan (the “Amended 2020 Plan”), which amended and restated the TimkenSteel 2020 plan. In general, the Amended 2020 Plan modified the TimkenSteel 2020 Plan to (1) increase the number of common shares, without par value, of the Company available for awards by 2,000,000 shares, (2) correspondingly increase the limit on shares that may be issued or transferred upon the exercise of incentive stock options by 2,000,000 shares, (3) remove the TimkenSteel 2020 Plan’s full value award limit of 1.8 million shares and (4) extend the plan term until May 5, 2031. In addition, the Amended 2020 Plan made certain other conforming, clarifying or non-substantive changes to the terms of the TimkenSteel 2020 Plan to implement the Amended 2020 Plan but did not make other material changes to the TimkenSteel 2020 Plan.

As of December 31, 2022, approximately 4.1 million shares of TimkenSteel common stock remained available for grants under the Amended 2020 Plan.

Stock Options

There were no stock options granted during the years ended December 31, 2022 and December 31, 2021.

The following summarizes TimkenSteel stock option activity from January 1, 2022 to December 31, 2022:

 

 

 

Number of
Shares

 

 

Weighted
Average
Exercise
Price

 

 

Weighted
Average
Remaining
Contractual
Term (Years)

 

 

Aggregate
Intrinsic Value
(millions)

 

Outstanding as of December 31, 2021

 

 

2,054,088

 

 

$

20.41

 

 

 

 

 

 

 

Granted

 

 

—

 

 

 

—

 

 

 

 

 

 

 

Exercised

 

 

(518,770

)

 

 

15.36

 

 

 

 

 

 

 

Canceled, forfeited or expired

 

 

(415,795

)

 

 

30.86

 

 

 

 

 

 

 

Outstanding as of December 31, 2022

 

 

1,119,523

 

 

$

18.85

 

 

 

3.9

 

 

$

5.8

 

Options expected to vest

 

 

167,610

 

 

 

6.44

 

 

 

7.0

 

 

 

2.0

 

Options exercisable

 

 

951,913

 

 

$

21.04

 

 

 

3.3

 

 

$

3.8

 

 

Stock options presented in the table above represent TimkenSteel awards only, including those held by The Timken Company employees.

Time-Based Restricted Stock Units

Time-based restricted stock units are issued with the fair value equal to the closing market price of TimkenSteel common shares on the date of grant. These restricted stock units do not have any performance conditions for vesting. Expense is recognized over the service period, adjusted for any forfeitures that occur during the vesting period.

The following summarizes TimkenSteel stock-settled, time-based restricted stock unit activity from January 1, 2022 to December 31, 2022:

 

 

 

Number of
Shares

 

 

Weighted
Average
Grant Date
Fair Value

 

Outstanding as of December 31, 2021

 

 

1,668,050

 

 

$

7.92

 

Granted

 

 

355,813

 

 

 

18.07

 

Vested

 

 

(420,083

)

 

 

11.41

 

Canceled, forfeited or expired

 

 

(57,778

)

 

 

8.35

 

Outstanding as of December 31, 2022

 

 

1,546,002

 

 

$

9.29

 

 

Performance-Based Restricted Stock Units

Performance-based restricted stock units are earned based on the average payout (determined under a Compensation Committee approved matrix) for the Company’s relative total shareholder return as compared to an identified peer group of steel companies. The overall vesting period is generally three years, with relative total shareholder return measured for the one, two and three-year periods creating effectively a “nested” 1-year, 2-year, and 3-year plan to support rapid and sustained shareholder value creation. Relative total shareholder return is calculated for each nested performance period by taking the beginning and ending price points based off a 20-trading day average closing stock price as of December 31.

The following summarizes TimkenSteel stock-settled performance-based restricted stock unit activity from January 1, 2022 to December 31, 2022:

 

 

 

Number of
Shares

 

 

Weighted
Average
Grant Date
Fair Value

 

Outstanding as of December 31, 2021

 

 

794,044

 

 

$

6.91

 

Granted

 

 

178,467

 

 

 

25.04

 

Canceled, forfeited or expired

 

 

(4,096

)

 

 

15.64

 

Outstanding as of December 31, 2022

 

 

968,415

 

 

$

10.21

 

Other Information

TimkenSteel recognized stock-based compensation expense of $8.8 million, $7.3 million and $6.6 million for the years ended December 31, 2022, 2021 and 2020, respectively.

As of December 31, 2022, future stock-based compensation expense related to the unvested portion of all awards is approximately $11.4 million, which is expected to be recognized over a weighted average period of 1.7 years.
v3.22.4
Accumulated Other Comprehensive Income (Loss)
 12 Months Ended
Dec. 31, 2022
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]  
Accumulated Other Comprehensive Income (Loss)

Note 17 - Accumulated Other Comprehensive Income (Loss)

Changes in accumulated other comprehensive income (loss) for the years ended December 31, 2022 and 2021 by component were as follows:

 

 

 

Foreign Currency
Translation
Adjustments

 

 

Pension and
Postretirement
Liability
Adjustments

 

 

Total

 

Balance as of December 31, 2021

 

$

(5.1

)

 

$

25.8

 

 

$

20.7

 

Other comprehensive income before reclassifications, before income tax

 

 

(1.7

)

 

 

—

 

 

 

(1.7

)

Amounts reclassified from accumulated other comprehensive income
   (loss), before income tax

 

—

 

 

 

(4.7

)

 

 

(4.7

)

Amounts deferred to accumulated other comprehensive income
   (loss), before income tax

 

—

 

 

 

—

 

 

 

—

 

Tax effect

 

—

 

 

 

0.4

 

 

 

0.4

 

Net current period other comprehensive income (loss), net of income taxes

 

 

(1.7

)

 

 

(4.3

)

 

 

(6.0

)

Balance as of December 31, 2022

 

$

(6.8

)

 

$

21.5

 

 

$

14.7

 

 

 

 

Foreign Currency
Translation
Adjustments

 

 

Pension and
Postretirement
Liability
Adjustments

 

 

Total

 

Balance as of December 31, 2020

 

$

(5.4

)

 

$

45.8

 

 

$

40.4

 

Other comprehensive income before reclassifications, before income tax

 

 

0.3

 

 

 

—

 

 

 

0.3

 

Amounts reclassified from accumulated other comprehensive income
   (loss), before income tax

 

—

 

 

 

(5.8

)

 

 

(5.8

)

Amounts deferred to accumulated other comprehensive income
   (loss), before income tax

 

—

 

 

 

(14.2

)

 

 

(14.2

)

Tax effect

 

—

 

 

 

—

 

 

 

—

 

Net current period other comprehensive income (loss), net of income taxes

 

 

0.3

 

 

 

(20.0

)

 

 

(19.7

)

Balance as of December 31, 2021

 

$

(5.1

)

 

$

25.8

 

 

$

20.7

 

 

The amount reclassified from accumulated other comprehensive income (loss) for the years ended December 31, 2021 and December 31, 2020 for the pension and postretirement liability adjustment was included in other (income) expense, net in the Consolidated Statements of Operations. The amount deferred to accumulated other comprehensive income (loss) for the year ended December 31, 2021 was a result of a plan amendment to the Company's Bargaining Plan. For more details refer to "Note 15 - Retirement and Postretirement Plans."
v3.22.4
Contingencies
 12 Months Ended
Dec. 31, 2022
Loss Contingency Accrual, Disclosures [Abstract]  
Contingencies

Note 18 – Contingencies

TimkenSteel has a number of loss exposures incurred in the ordinary course of business, such as environmental claims, product warranty claims, employee-related matters, and other litigation. Establishing loss reserves for these matters requires management’s estimate and judgment regarding risk exposure and ultimate liability or realization. These loss reserves are reviewed periodically and adjustments are made to reflect the most recent facts and circumstances. Accruals related to environmental claims represent management’s best estimate of the fees and costs associated with these claims. Although it is not possible to predict with certainty the outcome of such claims, management believes that their ultimate dispositions should not have a material adverse effect on our financial position, cash flows or results of operations. As of December 31, 2022 and 2021, TimkenSteel had a $1.1 million and $0.3 million contingency reserve, respectively, related to loss exposures incurred in the ordinary course of business.
v3.22.4
Schedule II-Valuation and Qualifying Accounts
 12 Months Ended
Dec. 31, 2022
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract]  
Schedule II-Valuation and Qualifying Accounts

Schedule II-Valuation and Qualifying Accounts

 

Allowance for uncollectible accounts:

 

2022

 

 

2021

 

 

2020

 

Balance at Beginning of Period

 

$

1.9

 

 

$

1.3

 

 

$

1.5

 

Additions:

 

 

 

 

 

 

 

 

 

Charged to Costs and Expenses (1)

 

 

—

 

 

 

0.6

 

 

—

 

Deductions (2)

 

 

(0.9

)

 

 

—

 

 

 

(0.2

)

Balance at End of Period

 

$

1.0

 

 

$

1.9

 

 

$

1.3

 

Allowance for inventory reserves:

 

2022

 

 

2021

 

 

2020

 

Balance at Beginning of Period

 

$

0.8

 

 

$

13.9

 

 

$

10.7

 

Additions:

 

 

 

 

 

 

 

 

 

Charged to Costs and Expenses (3)

 

 

0.5

 

 

 

2.8

 

 

 

4.1

 

Deductions (4)

 

 

(0.8

)

 

 

(15.9

)

 

 

(0.9

)

Balance at End of Period

 

$

0.5

 

 

$

0.8

 

 

$

13.9

 

Valuation allowance on deferred tax assets:

 

2022

 

 

2021

 

 

2020

 

Balance at Beginning of Period

 

$

15.5

 

 

$

47.7

 

 

$

34.9

 

Additions:

 

 

 

 

 

 

 

 

 

Charged to Costs and Expenses (5)

 

—

 

 

—

 

 

 

12.4

 

Charged to Other Accounts (6)

 

 

—

 

 

 

4.8

 

 

 

1.4

 

Deductions (7)

 

 

(2.5

)

 

 

(37.0

)

 

 

(1.0

)

Balance at End of Period

 

$

13.0

 

 

$

15.5

 

 

$

47.7

 


(1) Provision for uncollectible accounts included in expenses.


(2) Actual accounts written off against the allowance, net of recoveries.


(3) Provisions for surplus and obsolete inventory and lower cost or net realizable value included in expenses.


(4) Inventory items released against the allowance, either via write-off or a recovery. The allowance for inventory reserves decreased in 2021 due to sales of TMS inventory, along with the selling and scrapping of aged inventory.

(5) Increase in valuation allowance is recorded as a component of the provision for income taxes.

(6) Amount relates to valuation allowances recorded against other comprehensive income (loss).

(7) For the year ended December 31, 2022, this amount related to the release of a portion of the U.S. valuation allowance. For the year ended December 31, 2021, this amount relates to the release of the valuation allowance against tax loss carryforwards used during 2021. For the year ended December 31, 2020, this amount relates to an additional paid-in capital adjustment associated with the Convertible Notes.

v3.22.4
Significant Accounting Policies (Policies)
 12 Months Ended
Dec. 31, 2022
Accounting Policies [Abstract]  
Revenue Recognition

Revenue Recognition:

TimkenSteel recognizes revenue from contracts at a point in time when it has satisfied its performance obligation and the customer obtains control of the goods, at the amount that reflects the consideration the Company expects to receive for those goods.

 

Substantially all performance obligations arise from the sale of manufactured steel products. The Company receives and acknowledges purchase orders from its customers, which define the quantity, pricing, payment and other applicable terms and conditions. In some cases, the Company receives a blanket purchase order from its customer, which includes pricing, payment and other terms and conditions, with quantities defined at the time the customer issues periodic releases from the blanket purchase order.

 

Transfer of control and revenue recognition for substantially all the Company’s sales occur upon shipment or delivery of the product, which is when title, ownership, and risk of loss pass to the customer and is based on the applicable customer shipping terms.

 

The Company invoices its customers at the time of title transfer. Payment terms are generally 30 days from the invoice date. Invoiced amounts are usually inclusive of shipping and handling activities incurred. Shipping and handling activities billed are included in net sales in the Consolidated Statements of Operations. The related costs incurred by the Company for the delivery of goods are classified as cost of products sold in the Consolidated Statements of Operations.

 

Certain contracts contain variable consideration, which primarily consists of rebates that are accounted for in net sales and accrued based on the estimated probability of the requirements being met.

 

Sales returns and allowances are treated as a reduction to net sales and are provided for primarily based on historical experience. These reserves also capture any potential warranty claims, which normally result in returned or replaced product.
Cash Equivalents and Restricted Cash

Cash Equivalents and Restricted Cash:

TimkenSteel considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents.

The Company's restricted cash balance represents an imprest cash account used for the funding of employee healthcare costs. Funding of this account began during the first quarter of 2022 when the Company changed its healthcare plan administrator. The balance of restricted cash as of December 31, 2022 was $0.6 million, which is included in other current assets on the Consolidated Balance Sheets. The Company had no restricted cash as of December 31, 2021.
Accounts Receivables, Net

Accounts Receivables, Net:

The Company’s accounts receivables arise from sales to customers across the mobile, industrial, energy, and other end-market sectors. The allowance for doubtful account reserve has been established using qualitative and quantitative methods. In general, account balances are fully reserved when greater than one year of age or sent to third party collection. Account balances for customers that are viewed as higher risk are also analyzed for a reserve. In addition to these methods, the allowance for doubtful accounts is adjusted for forward-looking estimates of uncollectible balances based on end-market sector outlook and dynamics. Historically, write-offs for TimkenSteel’s allowance for doubtful accounts have been immaterial.
Inventories, Net

Inventories, Net:

Inventories are stated at lower of cost or net realizable value. All inventories, including raw materials, manufacturing supplies inventory, as well as international (outside the U.S.) inventories, have been valued using the FIFO or average cost method.
Property, Plant and Equipment, Net

Property, Plant and Equipment, Net:

Property, plant and equipment, net are valued at cost less accumulated depreciation. Maintenance and repairs are charged to expense as incurred. The provision for depreciation is computed principally by the straight-line method based upon the estimated useful lives of the assets. The useful lives are approximately 30 years for buildings and 3 to 20 years for machinery and equipment.
Intangible Assets, Net

Intangible Assets, Net:

Intangible assets subject to amortization are amortized on a straight-line method over their legal or estimated useful lives, with useful lives ranging from 3 to 15 years.

In accordance with applicable accounting guidance, TimkenSteel capitalizes certain costs incurred for computer software developed or obtained for internal use. TimkenSteel capitalizes substantially all external costs and qualifying internal costs related to the purchase and implementation of software projects used for business operations. Capitalized software costs primarily include purchased software and external consulting fees. Capitalized software projects are amortized over the estimated useful lives of the software.
Long-lived Assets

Long-lived Assets:

Long-lived assets (including tangible assets and intangible assets subject to amortization) are reviewed for impairment when events or changes in circumstances have occurred indicating that the carrying value of the assets may not be recoverable.

TimkenSteel tests recoverability of long-lived assets at the lowest level for which there are identifiable cash flows that are independent from the cash flows of other assets. Assets and asset groups held and used are measured for recoverability by comparing the carrying amount of the asset or asset group to the sum of future undiscounted net cash flows expected to be generated by the asset or asset group.

Assumptions and estimates about future values and remaining useful lives of TimkenSteel’s long-lived assets are complex and subjective. They can be affected by a variety of factors, including external factors such as industry and economic trends and internal factors such as changes in TimkenSteel’s business strategy and internal forecasts.

If an asset or asset group is considered to be impaired, the impairment loss that would be recognized is the amount by which the carrying amount of the assets exceeds the fair value of the assets. To determine fair value, TimkenSteel uses internal cash flow estimates discounted at an appropriate interest rate, third party appraisals, as appropriate, and/or market prices of similar assets, when available.

Refer to “Note 6 - Disposition of Non-Core Assets” and “Note 11 - Property, Plant and Equipment” for additional information.
Product Warranties

Product Warranties:

TimkenSteel accrues liabilities for warranties based upon specific claim incidents in accordance with accounting rules relating to contingent liabilities. Should TimkenSteel become aware of a specific potential warranty claim for which liability is probable and reasonably estimable, a specific charge is recorded and accounted for accordingly. TimkenSteel had warranty claims in the amount of $0.7 million and $1.4 million for the years ended December 31, 2022 and December 31, 2021, respectively. TimkenSteel had no significant warranty claims for the year ended December 31, 2020. Warranty claims are included in cost of products sold on the Consolidated Statements of Operations.
Income Taxes

Income Taxes:

Deferred tax assets and liabilities are recorded for the future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases, as well as net operating loss and tax credit carryforwards. TimkenSteel accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined on the basis of the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. TimkenSteel recognizes deferred tax assets to the extent TimkenSteel believes these assets are more likely than not to be realized. In making such a determination, TimkenSteel considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. If TimkenSteel determines that it would be able to realize deferred tax assets in the future in excess of their net recorded amount, TimkenSteel would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes.

TimkenSteel records uncertain tax positions in accordance with applicable accounting guidance, on the basis of a two-step process whereby (1) TimkenSteel determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position, and (2) for those tax positions that meet the more-likely-than-not recognition threshold, TimkenSteel recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority.

TimkenSteel recognizes interest and penalties related to unrecognized tax benefits within the provision (benefit) for income taxes line in the accompanying Consolidated Statements of Operations, if applicable. Accrued interest and penalties are included within the related tax liability line in the Consolidated Balance Sheets.
Foreign Currency

Foreign Currency:

Assets and liabilities of subsidiaries are translated at the rate of exchange in effect on the balance sheet date. Income and expenses are translated at the average rates of exchange prevailing during the year. The related translation adjustments are reflected as a separate component of accumulated other comprehensive income (loss). Gains and losses resulting from foreign currency transactions are included in other (income) expense, net in the Consolidated Statements of Operations. For the year ended December 31, 2022, TimkenSteel realized a foreign currency exchange gain of $0.2 million. For the years ended December 31, 2021 and December 31, 2020, TimkenSteel realized a foreign currency exchange loss of $0.1 million and $0.2 million, respectively.

Pension and Other Postretirement Benefits

Pension and Other Postretirement Benefits:

TimkenSteel recognizes an overfunded status or underfunded status (e.g., the difference between the fair value of plan assets and the benefit obligations) as either an asset or a liability for its defined benefit pension and other postretirement benefit plans on the Consolidated Balance Sheets. The Company recognizes actuarial gains and losses immediately through net periodic benefit cost in the Consolidated Statements of Operations upon the annual remeasurement at December 31, or on an interim basis as triggering events warrant remeasurement. An example of a potential triggering event would be settlements. The Company’s accounting policy is to recognize settlements during the quarter in which it is projected that the costs of all settlements during the year will be greater than the sum of the service cost and interest cost components of net periodic benefit cost. In addition, the Company uses fair value to account for the value of plan assets.
Stock-Based Compensation

Stock-Based Compensation:

TimkenSteel recognizes stock-based compensation expense based on the grant date fair value of the stock-based awards over their required vesting period on a straight-line basis, whether the awards were granted with graded or cliff vesting. Stock options are issued with an exercise price equal to the closing market price of TimkenSteel common shares on the date of grant. The fair value of stock options is determined using a Black-Scholes option pricing model, which incorporates assumptions regarding the expected volatility, the expected option life, the risk-free interest rate and the expected dividend yield.

Performance-based restricted stock units vest based on achievement of a total shareholder return ("TSR") metric. The TSR metric is considered a market condition, which requires TimkenSteel to reflect it in the fair value on grant date using an advanced option-pricing model. The fair value of each performance share was therefore determined using a Monte Carlo valuation model, a generally accepted lattice pricing model. The Monte Carlo valuation model, among other factors, uses commonly-accepted economic theory underlying all valuation models, estimates fair value using simulations of future share prices based on stock price behavior and considers the correlation of peer company returns in determining fair value.

The fair value of stock-based awards that will settle in TimkenSteel common shares, other than stock options and performance-based restricted stock units, is based on the closing market price of TimkenSteel common shares on the grant date.

TimkenSteel recognizes all excess tax benefits and tax deficiencies as income tax expense or benefit in the Consolidated Statements of Operations. The excess tax benefits and tax deficiencies are considered discrete items in the reporting period they occur and are not included in the estimate of an entity’s annual effective tax rate.
Research and Development

Research and Development:

Expenditures for research and development at TimkenSteel amounted to $0.8 million, $1.7 million and $1.8 million for the years ended December 31, 2022, 2021, and 2020, respectively, and were recorded as a component of selling, general and administrative expenses in the Consolidated Statements of Operations. These expenditures may fluctuate from year to year depending on special projects and the needs of TimkenSteel and its customers.
Adoption of New Accounting Standards

Adoption of New Accounting Standards

The Company did not adopt any Accounting Standard Updates (“ASU”) during 2022. Additionally, there are no current ASUs issued, but not adopted, that are expected to have a material impact on the Company.

 

As of January 1, 2021, the Company early adopted ASU 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40), using the modified retrospective method of transition. The standard simplifies the accounting for convertible instruments.

 

Upon adoption of ASU 2020-06 as of January 1, 2021, all outstanding Convertible Notes were fully classified as a liability, there was no longer a separate equity component and the Convertible Notes no longer have a debt discount that is amortized. This resulted in a decrease of $10.6 million to additional paid-in capital and an increase of $1.1 million and $5.3 million to current convertible notes, net and non-current convertible notes, net, respectively, on the Consolidated Balance Sheets as of January 1, 2021. Additionally, retained deficit was reduced by $4.2 million in the Consolidated Balance Sheets as of January 1, 2021 to remove amortization expense recognized in prior periods. The adoption of this standard did not have an effect on the Company’s cash flows, liquidity, or the methodology used for the earnings per share calculation. Refer to “Note 14 – Financing Arrangements” for additional information on the Convertible Notes.

 

Legislation related to the COVID-19 Pandemic

Due to a provision in the Coronavirus Aid, Relief, and Economic Security ("CARES") Act, the Company was able to defer the employer share of Social Security payroll taxes for a specified time during 2020. During the year ended December 31, 2020, the Company deferred $6.4 million in cash payments and recorded reserves for such deferred payroll taxes in salaries, wages and benefits on the Consolidated Balance Sheets, to be paid in two equal installments. The first installment in the amount of $3.2 million was paid during the fourth quarter of 2021 and the second installment of $3.2 million was paid during the fourth quarter of 2022.

 

The CARES Act also provided for an employee retention credit (“Employee Retention Credit”), which is a refundable tax credit against certain employment taxes. The Company qualified for the tax credit in the second and third quarters of 2020 and accrued a benefit of $2.3 million in the fourth quarter of 2020 related to the Employee Retention Credit in other (income) expense, net on the Consolidated Statements of Operations. The Company filed for this credit in the second quarter of 2021 and received a portion of the proceeds from the Internal Revenue Service ("IRS") in the amount of $0.5 million during the fourth quarter of 2021. The Company received the remaining $1.8 million of cash proceeds in the first quarter of 2022.
v3.22.4
Segment Information (Tables)
 12 Months Ended
Dec. 31, 2022
Segment Reporting [Abstract]  
Revenue from External Customers by Geographic Areas Net sales by geographic area are reported by the country in which the customer is domiciled.

 

 

Year Ended December 31,

 

 

 

2022

 

 

2021

 

 

2020

 

Net Sales:

 

 

 

 

 

 

 

 

 

United States

 

$

1,201.3

 

 

$

1,166.1

 

 

$

746.8

 

Foreign

 

 

128.6

 

 

 

116.8

 

 

 

83.9

 

 

 

$

1,329.9

 

 

$

1,282.9

 

 

$

830.7

 
Long-lived Assets by Geographic Areas Long-lived assets include property, plant and equipment and intangible assets subject to amortization. Long-lived assets by geographic area are reported by the location of the TimkenSteel operations to which the asset is attributed.

 

 

December 31,

 

 

 

2022

 

 

2021

 

Long-lived Assets, net:

 

 

 

 

 

 

United States

 

$

503.0

 

 

$

530.7

 

Foreign

 

 

0.6

 

 

 

0.7

 

 

 

$

503.6

 

 

$

531.4

 
v3.22.4
Revenue Recognition (Tables)
 12 Months Ended
Dec. 31, 2022
Revenue from Contract with Customer [Abstract]  
Disaggregation of Revenue

The following table provides the major sources of revenue by end-market sector for the years ended December 31, 2022, 2021 and 2020:

 

 

Year Ended December 31,

 

 

 

2022

 

 

2021

 

 

2020

 

Mobile

 

$

539.1

 

 

$

527.9

 

 

$

346.0

 

Industrial

 

 

628.7

 

 

 

661.2

 

 

 

391.7

 

Energy

 

 

136.6

 

 

 

62.9

 

 

 

53.2

 

Other(1)

 

 

25.5

 

 

 

30.9

 

 

 

39.8

 

Total Net Sales

 

$

1,329.9

 

 

$

1,282.9

 

 

$

830.7

 

 

(1) “Other” sales by end-market sector includes the Company’s scrap sales. In addition, 2020 includes oil country tubular goods billet sales.

The following table provides the major sources of revenue by product type for the years ended December 31, 2022, 2021 and 2020:

 

 

Year Ended December 31,

 

 

 

2022

 

 

2021

 

 

2020

 

Bar

 

$

887.4

 

 

$

863.6

 

 

$

502.5

 

Tube

 

 

173.7

 

 

 

164.4

 

 

 

101.4

 

Manufactured components

 

 

243.3

 

 

 

224.0

 

 

 

208.1

 

Other(2)

 

 

25.5

 

 

 

30.9

 

 

 

18.7

 

Total Net Sales

 

$

1,329.9

 

 

$

1,282.9

 

 

$

830.7

 

 

(2) “Other” for sales by product type relates to the Company’s scrap sales.
v3.22.4
Restructuring Charges (Tables)
 12 Months Ended
Dec. 31, 2022
Restructuring and Related Activities [Abstract]  
Schedule of Restructuring Reserve

The following is a summary of the restructuring reserve for the twelve months ended December 31, 2022 and 2021:

Balance at December 31, 2021

 

$

4.7

 

Expenses

 

 

0.8

 

Payments

 

 

(5.0

)

Balance at December 31, 2022

 

$

0.5

 

 

Balance at December 31, 2020

 

$

1.5

 

Expenses

 

 

6.7

 

Payments

 

 

(3.5

)

Balance at December 31, 2021

 

$

4.7

 
v3.22.4
Other (Income) Expense, Net (Tables)
 12 Months Ended
Dec. 31, 2022
Other Income and Expenses [Abstract]  
Schedule of Other (Income) Expense, Net

The following table provides the components of other (income) expense, net for the years ended December 31, 2022, 2021 and 2020:

 

 

Year Ended December 31,

 

 

 

2022

 

 

2021

 

 

2020

 

Pension and postretirement non-service benefit (income) loss

 

$

(20.3

)

 

$

(37.2

)

 

$

(26.6

)

Loss (gain) from remeasurement of benefit plans

 

 

(35.4

)

 

 

(20.1

)

 

 

14.7

 

Foreign currency exchange loss (gain)

 

 

(0.2

)

 

 

0.1

 

 

 

0.2

 

Insurance recoveries

 

 

(34.5

)

 

 

—

 

 

 

—

 

Sales and use tax refund

 

 

—

 

 

 

(2.5

)

 

 

—

 

Employee retention credit

 

 

—

 

 

 

—

 

 

 

(2.3

)

Miscellaneous (income) expense

 

 

(0.2

)

 

 

0.2

 

 

 

(0.2

)

Total other (income) expense, net

 

$

(90.6

)

 

$

(59.5

)

 

$

(14.2

)
v3.22.4
Income Tax Provision (Tables)
 12 Months Ended
Dec. 31, 2022
Income Tax Disclosure [Abstract]  
Schedule of Income before Income Tax, Domestic and Foreign

Income (loss) from operations before income taxes, based on geographic location of the operations to which such earnings are attributable, is provided below.

 

 

Years Ended December 31,

 

 

 

2022

 

 

2021

 

 

2020

 

United States

 

$

108.5

 

 

$

171.2

 

 

$

(64.1

)

Non-United States

 

 

(11.4

)

 

 

5.5

 

 

 

3.4

 

Income (loss) from operations before income taxes

 

$

97.1

 

 

$

176.7

 

 

$

(60.7

)
Schedule of (Benefit) Provision for Income Taxes

The provision (benefit) for income taxes consisted of the following:

 

 

Years Ended December 31,

 

 

 

2022

 

 

2021

 

 

2020

 

Current:

 

 

 

 

 

 

 

 

 

Federal

 

$

0.6

 

 

$

0.2

 

 

$

0.6

 

State and local

 

 

5.7

 

 

 

3.7

 

 

 

—

 

Foreign

 

 

0.8

 

 

 

0.6

 

 

 

0.5

 

Total current tax expense (benefit)

 

$

7.1

 

 

$

4.5

 

 

$

1.1

 

Deferred:

 

 

 

 

 

 

 

 

 

Federal

 

$

24.2

 

 

$

0.8

 

 

$

(0.4

)

State and local

 

 

0.7

 

 

 

0.3

 

 

 

0.5

 

Foreign

 

 

—

 

 

 

0.1

 

 

 

—

 

Total deferred tax expense (benefit)

 

 

24.9

 

 

 

1.2

 

 

 

0.1

 

Provision (benefit) for incomes taxes

 

$

32.0

 

 

$

5.7

 

 

$

1.2

 
Schedule of Effective Income Tax Rate Reconciliation

The reconciliation between TimkenSteel’s effective tax rate on income (loss) from continuing operations and the statutory tax rate is as follows:

 

 

Years Ended December 31,

 

 

 

2022

 

 

2021

 

 

2020

 

U.S. federal income tax provision (benefit) at statutory rate

 

$

20.4

 

 

$

37.1

 

 

$

(12.7

)

Adjustments:

 

 

 

 

 

 

 

 

 

State and local income taxes, net of federal tax benefit

 

 

8.4

 

 

 

4.1

 

 

 

2.3

 

Permanent differences

 

 

8.9

 

 

 

(0.2

)

 

 

1.3

 

Foreign earnings taxed at different rates

 

 

(3.6

)

 

 

(0.5

)

 

 

0.1

 

Valuation allowance

 

 

(2.5

)

 

 

(34.8

)

 

 

10.3

 

U.S. research tax credit

 

 

(0.6

)

 

 

—

 

 

 

—

 

Global intangible low-taxed income

 

 

—

 

 

 

—

 

 

 

—

 

Other items, net

 

 

1.0

 

 

 

—

 

 

 

(0.1

)

Provision (benefit) for income taxes

 

$

32.0

 

 

$

5.7

 

 

$

1.2

 

Effective tax rate

 

 

32.9

%

 

 

3.2

%

 

 

(2.0

)%
Schedule of Deferred Tax Assets and Liabilities

The effect of temporary differences giving rise to deferred tax assets and liabilities at December 31, 2022 and 2021 was as follows:

 

 

Years Ended December 31,

 

 

 

2022

 

 

2021

 

Deferred tax liabilities:

 

 

 

 

 

 

Depreciation

 

$

(81.4

)

 

$

(89.0

)

Inventory

 

 

—

 

 

 

(8.0

)

Leases - right-of-use asset

 

 

(3.1

)

 

 

(3.5

)

Deferred tax liabilities

 

$

(84.5

)

 

$

(100.5

)

Deferred tax assets:

 

 

 

 

 

 

Tax loss carryforwards

 

$

20.5

 

 

$

52.6

 

Pension and postretirement benefits

 

 

35.5

 

 

 

44.3

 

Other employee benefit accruals

 

 

6.6

 

 

 

8.2

 

Lease liability

 

 

3.1

 

 

 

3.5

 

State decoupling

 

 

0.8

 

 

 

1.3

 

Accrued restructuring

 

 

0.1

 

 

 

1.1

 

Capital loss carryforward

 

 

0.8

 

 

 

0.8

 

Intangible assets

 

 

0.2

 

 

 

0.6

 

Inventory

 

 

0.7

 

 

 

0.6

 

Allowance for doubtful accounts

 

 

0.3

 

 

 

0.5

 

Accrued Legal

 

 

2.0

 

 

 

—

 

Capitalized R&D

 

 

0.9

 

 

 

—

 

Other, net

 

 

0.1

 

 

 

0.3

 

Deferred tax assets subtotal

 

$

71.6

 

 

$

113.8

 

Valuation allowances

 

 

(13.0

)

 

 

(15.5

)

Deferred tax assets

 

 

58.6

 

 

 

98.3

 

Net deferred tax assets (liabilities)

 

$

(25.9

)

 

$

(2.2

)
v3.22.4
Earnings (Loss) Per Share (Tables)
 12 Months Ended
Dec. 31, 2022
Earnings Per Share [Abstract]  
Schedule of Earnings Per Share, Basic and Diluted

The following table sets forth the reconciliation of the numerator and the denominator of basic and diluted earnings (loss) per share for the years ended December 31, 2022, 2021 and 2020:

 

 

Year Ended December 31,

 

 

 

2022

 

 

2021

 

 

2020

 

Numerator:

 

 

 

 

 

 

 

 

 

Net income (loss), basic

 

$

65.1

 

 

$

171.0

 

 

$

(61.9

)

Add convertible notes interest

 

 

1.9

 

 

 

4.1

 

 

 

—

 

Net income (loss), diluted

 

$

67.0

 

 

$

175.1

 

 

$

(61.9

)

 

 

 

 

 

 

 

 

 

 

Denominator:

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding, basic

 

 

45.8

 

 

 

45.9

 

 

 

45.0

 

Dilutive effect of equity-based awards

 

 

2.1

 

 

 

1.7

 

 

 

—

 

Dilutive effect of convertible notes

 

 

3.6

 

 

 

7.4

 

 

 

—

 

Weighted average shares outstanding, diluted

 

 

51.5

 

 

 

55.0

 

 

 

45.0

 

 

 

 

 

 

 

 

 

 

 

Basic earnings (loss) per share

 

$

1.42

 

 

$

3.73

 

 

$

(1.38

)

Diluted earnings (loss) per share

 

$

1.30

 

 

$

3.18

 

 

$

(1.38

)
v3.22.4
Inventories (Tables)
 12 Months Ended
Dec. 31, 2022
Inventory Disclosure [Abstract]  
Schedule of Components of Inventory

The components of inventories as of December 31, 2022 and 2021 were as follows:

 

 

December 31,

 

 

 

2022

 

 

2021

 

Manufacturing supplies

 

$

36.9

 

 

$

29.3

 

Raw materials

 

 

23.9

 

 

 

37.3

 

Work in process

 

 

94.7

 

 

 

89.3

 

Finished products

 

 

37.4

 

 

 

55.8

 

Gross inventory

 

 

192.9

 

 

 

211.7

 

Allowance for inventory reserves

 

 

(0.5

)

 

 

(0.8

)

Total inventories, net

 

$

192.4

 

 

$

210.9

 
v3.22.4
Property, Plant and Equipment (Tables)
 12 Months Ended
Dec. 31, 2022
Property, Plant and Equipment [Abstract]  
Schedule of Property, Plant and Equipment

The components of property, plant and equipment, net as of December 31, 2022 and 2021 were as follows:

 

 

December 31,

 

 

 

2022

 

 

2021

 

Land

 

$

11.2

 

 

$

11.2

 

Buildings and improvements

 

 

414.6

 

 

 

415.0

 

Machinery and equipment

 

 

1,391.5

 

 

 

1,391.9

 

Construction in progress

 

 

30.8

 

 

 

9.6

 

Subtotal

 

 

1,848.1

 

 

 

1,827.7

 

Less allowances for depreciation

 

 

(1,362.0

)

 

 

(1,317.5

)

Property, plant and equipment, net

 

$

486.1

 

 

$

510.2

 
Schedule of Supplemental Cash Flow Information Related to Non-Cash Investing Activity

Supplemental cash flow information related to non-cash investing activity was as follows:

 

 

 

Year Ended December 31,

 

 

 

2022

 

 

2021

 

 

2019

 

Accrued property, plant and equipment purchases

 

$

10.6

 

 

$

3.6

 

 

$

2.0

 
v3.22.4
Intangible Assets (Tables)
 12 Months Ended
Dec. 31, 2022
Goodwill and Intangible Assets Disclosure [Abstract]  
Schedule of Finite-Lived Intangible Assets

The components of intangible assets, net as of December 31, 2022 and 2021 were as follows:

 

 

December 31, 2022

 

 

December 31, 2021

 

 

 

Gross
Carrying
Amount

 

 

Accumulated
Amortization

 

 

Net
Carrying
Amount

 

 

Gross
Carrying
Amount

 

 

Accumulated
Amortization

 

 

Net
Carrying
Amount

 

Customer relationships

 

$

6.3

 

 

$

6.2

 

 

$

0.1

 

 

$

6.3

 

 

$

5.8

 

 

$

0.5

 

Technology use

 

 

9.0

 

 

 

9.0

 

 

 

—

 

 

 

9.0

 

 

 

9.0

 

 

 

—

 

Capitalized software

 

 

57.9

 

 

 

53.0

 

 

 

4.9

 

 

 

57.4

 

 

 

51.2

 

 

 

6.2

 

Total intangible assets

 

$

73.2

 

 

$

68.2

 

 

$

5.0

 

 

$

72.7

 

 

$

66.0

 

 

$

6.7

 
Schedule of Estimated Annual Amortization Expense

Based upon the intangible assets subject to amortization as of December 31, 2022, TimkenSteel’s estimated annual amortization for the five succeeding years is shown below (in millions):

Year

 

Amortization
Expense

 

2023

 

$

2.3

 

2024

 

 

1.3

 

2025

 

 

0.3

 

2026

 

 

0.1

 

2027

 

 

0.1

 
v3.22.4
Leases (Tables)
 12 Months Ended
Dec. 31, 2022
Leases [Abstract]  
Lease, Cost

The Company recorded lease cost for the years ended December 31, 2022, 2021 and 2020 as follows:

 

 

Year Ended December 31,

 

 

 

2022

 

 

2021

 

 

2020

 

Operating lease cost

 

$

6.7

 

 

$

8.2

 

 

$

8.8

 

Short-term lease cost

 

 

0.9

 

 

 

0.7

 

 

 

0.7

 

Total lease cost

 

$

7.6

 

 

$

8.9

 

 

$

9.5

 

Supplemental cash flow information related to leases was as follows:

 

 

Year Ended December 31,

 

 

 

2022

 

 

2021

 

 

2020

 

Cash paid for amounts included in the measurement of operating lease liabilities

 

$

6.7

 

 

$

8.2

 

 

$

8.8

 

Right-of-use assets obtained in exchange for operating lease obligations

 

$

4.5

 

 

$

3.1

 

 

$

12.5

 
Future Lease Maturity

Future minimum lease payments under non-cancellable leases as of December 31, 2022 were as follows:

2023

 

$

6.3

 

2024

 

 

4.0

 

2025

 

 

1.9

 

2026

 

 

0.5

 

After 2026

 

 

0.3

 

Total future minimum lease payments

 

 

13.0

 

    Less amount of lease payment representing interest

 

 

(0.5

)

Total present value of lease payments

 

$

12.5

 
v3.22.4
Financing Arrangements (Tables)
 12 Months Ended
Dec. 31, 2022
Debt Instrument [Line Items]  
Summary of Current and Non-current Debt

The following table summarizes the current and non-current debt as of December 31, 2022 and 2021:

 

 

 

December 31,

 

 

 

2022

 

 

2021

 

Credit Agreement

 

$

—

 

 

$

—

 

Convertible Senior Notes due 2021

 

 

—

 

 

 

—

 

Convertible Senior Notes due 2025

 

 

20.4

 

 

 

44.9

 

Total debt

 

$

20.4

 

 

$

44.9

 

Less current portion of debt

 

 

20.4

 

 

 

44.9

 

Total non-current portion of debt

 

$

—

 

 

$

—

 
Schedule of Net Carrying Amount of Extinguished Convertible Senior Notes

Net carrying amount of extinguished Convertible Senior Notes due 2021 as of December 15, 2020

 

 

 

    Principal

 

$

46.0

 

    Less: Debt issuance costs, net of amortization

 

 

(0.1

)

    Less: Debt discount, net of amortization

 

 

(1.5

)

Fair value of extinguished Convertible Senior Notes due 2021 as of December 15, 2020

 

 

45.3

 

Loss on extinguishment of debt

 

$

(0.9

)
Schedule of Amount Allocated to Reacquisition of Equity Component Included as Reduction To Additional Paid-In Capital

The amount allocated to the reacquisition of the equity component, included as a reduction to additional paid-in capital on the Consolidated Balance Sheets, was calculated as follows:

 

Fair value of extinguished Convertible Senior Notes due 2021 as of December 15, 2020

 

$

45.3

 

Principal of extinguished Convertible Senior Notes due 2021

 

 

46.0

 

Reduction of additional paid-in capital in 2020

 

$

(0.7

)
Schedule of Interest (income) Expense

The following table provides the components of interest (income) expense, net for the years ended December 31, 2022, December 31, 2021 and December 31, 2020:

 

 

 

Year Ended December 31,

 

 

 

2022

 

 

2021

 

 

2020

 

Interest expense

 

$

3.9

 

 

$

6.2

 

 

$

12.6

 

Interest income

 

 

(3.3

)

 

 

(0.3

)

 

 

(0.4

)

Interest (income) expense, net

 

$

0.6

 

 

$

5.9

 

 

$

12.2

 
Convertible Senior Notes due 2025  
Debt Instrument [Line Items]  
Schedule of Components of Convertible Notes

The components of the Convertible Senior Notes due 2025 as of December 31, 2022 and December 31, 2021 were as follows:

 

 

 

December 31,

 

 

 

2022

 

 

2021

 

Principal

 

$

20.8

 

 

$

46.0

 

Less: Debt issuance costs, net of amortization

 

 

(0.4

)

 

 

(1.1

)

Less: Debt discount, net of amortization

 

 

—

 

 

 

—

 

Convertible Senior Notes due 2025, net

 

$

20.4

 

 

$

44.9

 
Convertible Notes  
Debt Instrument [Line Items]  
Schedule of Interest (income) Expense

The following table sets forth total interest expense recognized specifically related to the Convertible Notes:

 

 

 

Year Ended December 31,

 

 

 

2022

 

 

2021

 

 

2020

 

Contractual interest expense

 

$

1.7

 

 

$

3.7

 

 

$

5.2

 

Amortization of debt issuance costs

 

 

0.1

 

 

 

0.4

 

 

 

0.5

 

Amortization of debt discount

 

 

—

 

 

 

—

 

 

 

4.4

 

Total

 

$

1.8

 

 

$

4.1

 

 

$

10.1

 
v3.22.4
Retirement and Postretirement Plans (Tables)
 12 Months Ended
Dec. 31, 2022
Defined Benefit Plans and Other Postretirement Benefit Plans Disclosures [Abstract]  
Schedule of Defined Benefit Plans Disclosures

The following table sets forth the change in benefit obligation for the pension and postretirement benefit plans as of December 31, 2022:
 

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

Change in benefit obligation:

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

 

Pension
Scheme

 

 

Pension
Plan

 

 

Total
Pension

 

 

Postretirement
Plans

 

Benefit obligation at the beginning of year

 

$

1,025.4

 

 

$

187.4

 

 

$

23.6

 

 

$

82.4

 

 

$

0.4

 

 

$

1,319.2

 

 

$

117.8

 

Service cost

 

 

13.9

 

 

 

0.3

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

14.2

 

 

 

1.1

 

Interest cost

 

 

31.1

 

 

 

6.5

 

 

 

0.7

 

 

 

1.3

 

 

 

—

 

 

 

39.6

 

 

 

3.4

 

Actuarial (gains) losses

 

 

(203.6

)

 

 

(34.0

)

 

 

(6.5

)

 

 

(25.3

)

 

 

—

 

 

 

(269.4

)

 

 

(24.0

)

Benefits paid

 

 

(51.0

)

 

 

(11.6

)

 

 

(0.6

)

 

 

(2.5

)

 

 

—

 

 

 

(65.7

)

 

 

(10.9

)

Settlements

 

 

(340.9

)

 

 

(20.5

)

 

 

(1.7

)

 

 

—

 

 

 

—

 

 

 

(363.1

)

 

 

—

 

Foreign currency translation adjustment

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(8.2

)

 

 

—

 

 

 

(8.2

)

 

 

—

 

Benefit obligation at the end of year

 

$

474.9

 

 

$

128.1

 

 

$

15.5

 

 

$

47.7

 

 

$

0.4

 

 

$

666.6

 

 

$

87.4

 

Significant actuarial gains related to changes in benefit obligations for 2022 primarily resulted from an increase in discount rates. Significant settlements were a result of the Bargaining Plan annuity purchase as well as lump sum payments during 2022.

The following table sets forth the change in benefit obligation for the pension and postretirement benefit plans as of December 31, 2021:

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

Change in benefit obligation:

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

 

Pension
Scheme

 

 

Pension
Plan

 

 

Total
Pension

 

 

Postretirement
Plans

 

Benefit obligation at the beginning of year

 

$

1,053.9

 

 

$

228.7

 

 

$

27.3

 

 

$

84.8

 

 

$

0.4

 

 

$

1,395.1

 

 

$

128.3

 

Service cost

 

 

17.0

 

 

 

0.4

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

17.4

 

 

 

1.2

 

Interest cost

 

 

28.4

 

 

 

5.9

 

 

 

0.8

 

 

 

1.1

 

 

 

—

 

 

 

36.2

 

 

 

3.2

 

Actuarial (gains) losses

 

 

(31.6

)

 

 

(5.1

)

 

 

(1.5

)

 

 

0.3

 

 

 

—

 

 

 

(37.9

)

 

 

(6.0

)

Benefits paid

 

 

(56.5

)

 

 

(11.4

)

 

 

(3.0

)

 

 

(3.0

)

 

 

—

 

 

 

(73.9

)

 

 

(8.9

)

Plan amendment

 

 

14.2

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

14.2

 

 

 

—

 

Settlements

 

 

—

 

 

 

(31.1

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(31.1

)

 

 

—

 

Foreign currency translation adjustment

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(0.8

)

 

 

—

 

 

 

(0.8

)

 

 

—

 

Benefit obligation at the end of year

 

$

1,025.4

 

 

$

187.4

 

 

$

23.6

 

 

$

82.4

 

 

$

0.4

 

 

$

1,319.2

 

 

$

117.8

 

Significant actuarial gains related to changes in benefit obligations for 2021 primarily resulted from an increase in discount rates.

The following table sets forth the change in plan assets and funded status for the pension and postretirement benefit plan as of December 31, 2022:

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

Change in plan assets:

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

 

Pension
Scheme

 

 

Pension
Plan

 

 

Total
Pension

 

 

Postretirement
Plans

 

Fair value of plan assets at the beginning of year

 

$

862.8

 

 

$

205.7

 

 

$

—

 

 

$

107.2

 

 

$

0.3

 

 

$

1,176.0

 

 

$

76.8

 

Actual return on plan assets

 

 

(119.7

)

 

 

(35.9

)

 

 

—

 

 

 

(38.0

)

 

 

—

 

 

 

(193.6

)

 

 

(8.8

)

Company contributions / payments

 

 

—

 

 

 

—

 

 

 

2.3

 

 

 

1.3

 

 

 

—

 

 

 

3.6

 

 

 

2.1

 

Benefits paid

 

 

(51.0

)

 

 

(11.6

)

 

 

(0.6

)

 

 

(2.5

)

 

 

—

 

 

 

(65.7

)

 

 

(10.9

)

Settlements

 

 

(338.2

)

 

 

(20.5

)

 

 

(1.7

)

 

 

—

 

 

 

—

 

 

 

(360.4

)

 

 

—

 

Foreign currency translation adjustment

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(10.5

)

 

 

—

 

 

 

(10.5

)

 

 

—

 

Fair value of plan assets at end of year

 

$

353.9

 

 

$

137.7

 

 

$

—

 

 

$

57.5

 

 

$

0.3

 

 

$

549.4

 

 

$

59.2

 

Funded status at end of year

 

$

(121.0

)

 

$

9.6

 

 

$

(15.5

)

 

$

9.8

 

 

$

(0.1

)

 

$

(117.2

)

 

$

(28.2

)

 

The following table sets forth the change in plan assets and funded status for the pension and postretirement benefit plan as of December 31, 2021:

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

Change in plan assets:

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

 

Pension
Scheme

 

 

Pension
Plan

 

 

Total
Pension

 

 

Postretirement
Plans

 

Fair value of plan assets at the beginning of year

 

$

884.3

 

 

$

243.3

 

 

$

—

 

 

$

103.8

 

 

$

0.3

 

 

$

1,231.7

 

 

$

82.2

 

Actual return on plan assets

 

 

35.0

 

 

 

4.9

 

 

 

—

 

 

 

4.7

 

 

 

—

 

 

 

44.6

 

 

 

2.4

 

Company contributions / payments

 

 

—

 

 

 

—

 

 

 

3.0

 

 

 

2.8

 

 

 

—

 

 

 

5.8

 

 

 

1.1

 

Benefits paid

 

 

(56.5

)

 

 

(11.4

)

 

 

(3.0

)

 

 

(3.0

)

 

 

—

 

 

 

(73.9

)

 

 

(8.9

)

Settlements

 

 

—

 

 

 

(31.1

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(31.1

)

 

 

—

 

Foreign currency translation adjustment

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(1.1

)

 

 

—

 

 

 

(1.1

)

 

 

—

 

Fair value of plan assets at end of year

 

$

862.8

 

 

$

205.7

 

 

$

—

 

 

$

107.2

 

 

$

0.3

 

 

$

1,176.0

 

 

$

76.8

 

Funded status at end of year

 

$

(162.6

)

 

$

18.3

 

 

$

(23.6

)

 

$

24.8

 

 

$

(0.1

)

 

$

(143.2

)

 

$

(41.0

)

The Bargaining Plan, Salaried Plan, and Supplemental Plan have a provision that permits employees to elect to receive their pension benefits in a lump sum upon retirement. The Company's accounting policy is to recognize settlements during the quarter in which it is projected that the costs of all settlements during the year will be greater than the sum of the service cost and intertest cost components.

In the first quarter of 2022, the cumulative cost of all lump sum payments exceeded this threshold for the Supplemental Plan. Additionally, in the first quarter of 2022, the cumulative costs of all lump sum payments were projected to exceed this threshold during 2022 for the Salaried Plan. These costs did ultimately exceed this threshold for the Salaried Plan during the second quarter of 2022. Also, during the second quarter of 2022, the cumulative costs of all lump sum payments were projected to exceed this threshold in 2022 for the Bargaining Plan. These costs did ultimately exceed this threshold for the Bargaining Plan during the third quarter of 2022.

These payments constitute a partial settlement, which is a significant event requiring remeasurement of both plan assets and benefit obligations. As a result, the Company completed a full remeasurement of its pension obligations and plan assets associated with the Supplemental Plan during the first quarter of 2022. No further remeasurement was required in 2022 related to the Supplemental Plan, as no further lump sum payments have been made. The Salaried Plan's pension obligations and plan assets were remeasured during each quarter of 2022. We also completed a full remeasurement of the Bargaining Plan's pension obligations and plan assets during the second, third, and fourth quarters of 2022.

Schedule of Amounts Recognized in Balance Sheet

Amounts recognized on the balance sheet at December 31, 2022 for TimkenSteel’s pension and postretirement benefit plans include:

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

 

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

 

Pension
Scheme

 

 

Pension
Plan

 

 

Total
Pension

 

 

Postretirement
Plans

 

Non-current assets

 

$

—

 

 

$

9.6

 

 

$

—

 

 

$

9.8

 

 

$

—

 

 

$

19.4

 

 

$

—

 

Current liabilities

 

 

—

 

 

 

—

 

 

 

(0.6

)

 

 

—

 

 

 

—

 

 

 

(0.6

)

 

 

(1.4

)

Non-current liabilities

 

 

(121.0

)

 

 

—

 

 

 

(15.0

)

 

 

—

 

 

 

(0.1

)

 

 

(136.1

)

 

 

(26.8

)

Total

 

$

(121.0

)

 

$

9.6

 

 

$

(15.6

)

 

$

9.8

 

 

$

(0.1

)

 

$

(117.3

)

 

$

(28.2

)

Amounts recognized on the balance sheet at December 31, 2021 for TimkenSteel’s pension and postretirement benefit plans include:

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

 

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

 

Pension
Scheme

 

 

Pension
Plan

 

 

Total
Pension

 

 

Postretirement
Plans

 

Non-current assets

 

$

—

 

 

$

18.3

 

 

$

—

 

 

$

24.8

 

 

$

—

 

 

$

43.1

 

 

$

—

 

Current liabilities

 

 

—

 

 

 

—

 

 

 

(2.6

)

 

 

—

 

 

 

—

 

 

 

(2.6

)

 

 

(1.7

)

Non-current liabilities

 

 

(162.6

)

 

 

—

 

 

 

(21.0

)

 

 

—

 

 

 

(0.1

)

 

 

(183.7

)

 

 

(39.3

)

Total

 

$

(162.6

)

 

$

18.3

 

 

$

(23.6

)

 

$

24.8

 

 

$

(0.1

)

 

$

(143.2

)

 

$

(41.0

)
Schedule of Amounts Recognized in Other Comprehensive Income (Loss)

Included in accumulated other comprehensive income (loss) at December 31, 2022 were the following before-tax amounts that had not been recognized in net periodic benefit cost:

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

 

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

 

Pension
Scheme

 

 

Pension
Plan

 

 

Total
Pension

 

 

Postretirement
Plans

 

Unrecognized prior service (benefit) cost

 

$

12.4

 

 

$

—

 

 

$

—

 

 

$

0.5

 

 

$

—

 

 

$

12.9

 

 

$

(49.9

)

Included in accumulated other comprehensive income (loss) at December 31, 2021 were the following before-tax amounts that had not been recognized in net periodic benefit cost:

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

 

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

 

Pension
Scheme

 

 

Pension
Plan

 

 

Total
Pension

 

 

Postretirement
Plans

 

Unrecognized prior service (benefit) cost

 

$

13.6

 

 

$

—

 

 

$

—

 

 

$

0.6

 

 

$

—

 

 

$

14.2

 

 

$

(55.9

)
Schedule of Assumptions Used

The weighted average assumptions used in determining benefit obligation as of December 31, 2022 and 2021 were as follows:

 

 

Pension

 

 

Postretirement

 

Assumptions:

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Discount rate

 

 

5.61

%

 

 

2.96

%

 

 

5.70

%

 

 

3.00

%

Future compensation assumption

 

 

3.00

%

 

 

3.00

%

 

n/a

 

 

n/a

 
The weighted average assumptions used in determining benefit cost for the years ended December 31, 2022 and 2021 were as follows:

 

 

 

Pension

 

 

Postretirement

 

Assumptions:

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Discount rate

 

 

2.96

%

 

 

2.68

%

 

 

3.00

%

 

 

2.65

%

Future compensation assumption

 

 

3.00

%

 

 

2.29

%

 

n/a

 

 

n/a

 

Expected long-term return on plan assets

 

 

5.96

%

 

 

5.76

%

 

 

4.75

%

 

 

4.50

%

 
Schedule of Periodic Benefit Cost

The components of net periodic benefit cost (income) for the year ended December 31, 2022 were as follows:

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

Components of net periodic benefit cost (income):

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

 

Pension
Scheme

 

 

Pension
Plan

 

 

Total
Pension

 

 

Postretirement
Plans

 

Service cost

 

$

13.9

 

 

$

0.3

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

14.2

 

 

$

1.1

 

Interest cost

 

 

31.1

 

 

 

6.5

 

 

 

0.7

 

 

 

1.3

 

 

 

—

 

 

 

39.6

 

 

 

3.4

 

Expected return on plan assets

 

 

(46.7

)

 

 

(5.0

)

 

 

—

 

 

 

(3.2

)

 

 

—

 

 

 

(54.9

)

 

 

(3.4

)

Amortization of prior service cost

 

 

1.3

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

1.3

 

 

 

(6.0

)

Settlements

 

 

(2.7

)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(2.7

)

 

 

—

 

Net remeasurement losses (gains)

 

 

(37.2

)

 

 

6.9

 

 

 

(6.5

)

 

 

15.9

 

 

 

—

 

 

 

(20.9

)

 

 

(11.8

)

Net Periodic Benefit Cost (Income)

 

$

(40.3

)

 

$

8.7

 

 

$

(5.8

)

 

$

14.0

 

 

$

—

 

 

$

(23.4

)

 

$

(16.7

)

The components of net periodic benefit cost (income) for the year ended December 31, 2021 were as follows:

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

Components of net periodic benefit cost (income):

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

 

Pension
Scheme

 

 

Pension
Plan

 

 

Total
Pension

 

 

Postretirement
Plans

 

Service cost

 

$

17.0

 

 

$

0.4

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

17.4

 

 

$

1.2

 

Interest cost

 

 

28.4

 

 

 

5.9

 

 

 

0.8

 

 

 

1.1

 

 

 

—

 

 

 

36.2

 

 

 

3.2

 

Expected return on plan assets

 

 

(51.5

)

 

 

(12.6

)

 

 

—

 

 

 

(3.3

)

 

 

—

 

 

 

(67.4

)

 

 

(3.4

)

Amortization of prior service cost

 

 

0.2

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

0.2

 

 

 

(6.0

)

Curtailment

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Net remeasurement losses (gains)

 

 

(15.1

)

 

 

2.5

 

 

 

(1.5

)

 

 

(1.1

)

 

 

—

 

 

 

(15.2

)

 

 

(4.9

)

Net Periodic Benefit Cost (Income)

 

$

(21.0

)

 

$

(3.8

)

 

$

(0.7

)

 

$

(3.3

)

 

$

—

 

 

$

(28.8

)

 

$

(9.9

)

 

The components of net periodic benefit cost (income) for the year ended December 31, 2020 were as follows:

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

Components of net periodic benefit cost (income):

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

 

Pension
Scheme

 

 

Pension
Plan

 

 

Total
Pension

 

 

Postretirement
Plans

 

Service cost

 

$

16.9

 

 

$

2.5

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

19.4

 

 

$

1.0

 

Interest cost

 

 

33.3

 

 

 

7.0

 

 

 

0.9

 

 

 

1.5

 

 

 

—

 

 

 

42.7

 

 

 

4.2

 

Expected return on plan assets

 

 

(47.5

)

 

 

(13.5

)

 

 

—

 

 

 

(3.3

)

 

 

—

 

 

 

(64.3

)

 

 

(3.5

)

Amortization of prior service cost

 

 

0.3

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

0.3

 

 

 

(6.0

)

Curtailment

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Net remeasurement losses (gains)

 

 

10.8

 

 

 

(1.0

)

 

 

1.8

 

 

 

0.4

 

 

 

0.1

 

 

 

12.1

 

 

 

2.6

 

Net Periodic Benefit Cost (Income)

 

$

13.8

 

 

$

(5.0

)

 

$

2.7

 

 

$

(1.4

)

 

$

0.1

 

 

$

10.2

 

 

$

(1.7

)
Schedule of Target Allocations for each Plan's Assets

The target allocations for each plan's assets are as follows:

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

Target Allocations:

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

Pension
Scheme

 

 

Pension
Plan

 

 

Weighted
Average
Pension

 

 

Postretirement
Plans

 

Equity securities

 

 

35.0

%

 

 

—

 

 

n/a

 

 

16.7

%

 

 

—

 

 

 

24.3

%

 

 

20.0

%

Debt securities

 

 

44.0

%

 

 

100.0

%

 

n/a

 

 

66.6

%

 

 

100.0

%

 

 

60.4

%

 

 

77.5

%

Other investments

 

 

21.0

%

 

 

—

 

 

n/a

 

 

16.7

%

 

 

—

 

 

 

15.3

%

 

 

2.5

%
Schedule of Allocation of Plan Assets

The following table presents the fair value hierarchy for those investments of TimkenSteel’s pension assets measured at fair value on a recurring basis as of December 31, 2022:

 

 

Total

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

58.4

 

 

$

3.0

 

 

$

55.4

 

 

$

—

 

U.S government and agency securities

 

 

53.7

 

 

 

49.4

 

 

 

4.3

 

 

 

—

 

Corporate bonds

 

 

113.0

 

 

 

—

 

 

 

113.0

 

 

 

—

 

Equity securities

 

 

14.5

 

 

 

14.5

 

 

 

—

 

 

 

—

 

Real estate

 

 

7.6

 

 

 

—

 

 

 

—

 

 

 

7.6

 

Private debt

 

 

18.8

 

 

 

—

 

 

 

—

 

 

 

18.8

 

Total Assets in the fair value hierarchy

 

$

266.0

 

 

$

66.9

 

 

$

172.7

 

 

$

26.4

 

Assets measured at net asset value (1)

 

 

283.4

 

 

 

—

 

 

 

—

 

 

 

—

 

Total Assets

 

$

549.4

 

 

$

66.9

 

 

$

172.7

 

 

$

26.4

 


(1) Certain assets that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. Such assets include common collective trusts that invest in equity securities and fixed income securities, limited partnerships, real estate partnerships, and hedge funds. As of December 31, 2022, these assets are redeemable at net asset value within 90 days, except for certain private investments with an estimated liquidation period of one to ten years.

The following table presents the fair value hierarchy for those investments of TimkenSteel’s pension assets measured at fair value on a recurring basis as of December 31, 2021:

 

 

Total

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

87.6

 

 

$

1.2

 

 

$

86.4

 

 

$

—

 

U.S government and agency securities

 

 

173.9

 

 

 

166.7

 

 

 

7.2

 

 

 

—

 

Corporate bonds

 

 

244.7

 

 

 

—

 

 

 

244.7

 

 

 

—

 

Equity securities

 

 

25.3

 

 

 

25.3

 

 

 

—

 

 

 

—

 

Other

 

 

0.3

 

 

 

—

 

 

 

0.3

 

 

 

—

 

Total Assets in the fair value hierarchy

 

$

531.8

 

 

$

193.2

 

 

$

338.6

 

 

$

—

 

Assets measured at net asset value (1)

 

 

644.2

 

 

 

—

 

 

 

—

 

 

 

—

 

Total Assets

 

$

1,176.0

 

 

$

193.2

 

 

$

338.6

 

 

$

—

 


(1) Certain assets that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. Such assets include common collective trusts that invest in equity securities and fixed income securities, limited partnerships, real estate partnerships, and hedge funds. As of December 31, 2021, these assets were redeemable at net asset value within 90 days.

The following table sets forth a summary of changes in the fair value of TimkenSteel's pension plan level three assets for the year ended December 31, 2022:

 

 

Level 3 assets only

 

 

 

2022

 

Balance at the beginning of year

 

$

—

 

Transfers in and/or out of Level 3

 

 

—

 

Actual return on plan assets:

 

 

 

Realized gain (loss)

 

 

0.4

 

Net unrealized gain (loss)

 

 

0.1

 

Purchases, sales, issuances and settlements:

 

 

 

Purchases

 

 

31.4

 

Sales

 

 

(5.5

)

Balance at the end of year

 

$

26.4

 

 

The following table presents the fair value hierarchy for those investments of TimkenSteel’s postretirement assets measured at fair value on a recurring basis as of December 31, 2022:

 

 

Total

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

1.4

 

 

$

1.4

 

 

$

—

 

 

$

—

 

Mutual fund - fixed income

 

 

4.7

 

 

 

4.7

 

 

 

—

 

 

 

—

 

Total Assets in the fair value hierarchy

 

$

6.1

 

 

$

6.1

 

 

$

—

 

 

$

—

 

Assets measured at net asset value (1)

 

 

53.1

 

 

 

—

 

 

 

—

 

 

 

—

 

Total Assets

 

$

59.2

 

 

$

6.1

 

 

$

—

 

 

$

—

 


(1) Certain assets that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. Such assets include common collective trusts that invest in equity securities and fixed income securities. As of December 31, 2022, these assets are redeemable at net asset value within 90 days.

The following table presents the fair value hierarchy for those investments of TimkenSteel’s postretirement assets measured at fair value on a recurring basis as of December 31, 2021:

 

 

Total

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

3.8

 

 

$

3.8

 

 

$

—

 

 

$

—

 

Mutual fund - fixed income

 

 

5.8

 

 

 

5.8

 

 

 

—

 

 

 

—

 

Total Assets in the fair value hierarchy

 

$

9.6

 

 

$

9.6

 

 

$

—

 

 

$

—

 

Assets measured at net asset value (1)

 

 

67.2

 

 

 

—

 

 

 

—

 

 

 

—

 

Total Assets

 

$

76.8

 

 

$

9.6

 

 

$

—

 

 

$

—

 


(1) Certain assets that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. Such assets include common collective trusts that invest in equity securities, fixed income securities, and limited partnerships. As of December 31, 2021, these assets were redeemable at net asset value within 90 days.
Schedule of Expected Benefit Payments

Future benefit payments are expected to be as follows:

 

 

Pension

 

 

 

 

 

 

 

 

 

United States of America

 

 

United Kingdom

 

 

Mexico

 

 

 

 

 

 

 

Benefit Payments:

 

Bargaining
Plan

 

 

Salaried
Plan

 

 

Supplemental
Plan

 

 

Pension
Scheme

 

 

Pension
Plan

 

 

Total
Pension

 

 

Postretirement
Plans

 

2023

 

$

36.3

 

 

$

13.3

 

 

$

0.6

 

 

$

2.1

 

 

$

—

 

 

$

52.3

 

 

$

10.1

 

2024

 

 

36.9

 

 

 

13.3

 

 

 

0.6

 

 

 

2.2

 

 

 

—

 

 

 

53.0

 

 

 

9.1

 

2025

 

 

39.1

 

 

 

12.3

 

 

 

0.5

 

 

 

2.3

 

 

 

—

 

 

 

54.2

 

 

 

8.5

 

2026

 

 

41.8

 

 

 

11.7

 

 

 

0.5

 

 

 

2.2

 

 

 

—

 

 

 

56.2

 

 

 

8.0

 

2027

 

 

46.3

 

 

 

11.3

 

 

 

13.4

 

 

 

2.3

 

 

 

—

 

 

 

73.3

 

 

 

7.7

 

2028-2032

 

 

214.1

 

 

 

49.8

 

 

 

2.1

 

 

 

12.3

 

 

 

0.6

 

 

 

278.9

 

 

 

34.3

 
v3.22.4
Stock-Based Compensation (Tables)
 12 Months Ended
Dec. 31, 2022
Share-based Compensation, Stock Options, Activity

The following summarizes TimkenSteel stock option activity from January 1, 2022 to December 31, 2022:

 

 

 

Number of
Shares

 

 

Weighted
Average
Exercise
Price

 

 

Weighted
Average
Remaining
Contractual
Term (Years)

 

 

Aggregate
Intrinsic Value
(millions)

 

Outstanding as of December 31, 2021

 

 

2,054,088

 

 

$

20.41

 

 

 

 

 

 

 

Granted

 

 

—

 

 

 

—

 

 

 

 

 

 

 

Exercised

 

 

(518,770

)

 

 

15.36

 

 

 

 

 

 

 

Canceled, forfeited or expired

 

 

(415,795

)

 

 

30.86

 

 

 

 

 

 

 

Outstanding as of December 31, 2022

 

 

1,119,523

 

 

$

18.85

 

 

 

3.9

 

 

$

5.8

 

Options expected to vest

 

 

167,610

 

 

 

6.44

 

 

 

7.0

 

 

 

2.0

 

Options exercisable

 

 

951,913

 

 

$

21.04

 

 

 

3.3

 

 

$

3.8

 

 
Time-Based Restricted Stock Units  
Nonvested Restricted Stock Shares Activity

The following summarizes TimkenSteel stock-settled, time-based restricted stock unit activity from January 1, 2022 to December 31, 2022:

 

 

 

Number of
Shares

 

 

Weighted
Average
Grant Date
Fair Value

 

Outstanding as of December 31, 2021

 

 

1,668,050

 

 

$

7.92

 

Granted

 

 

355,813

 

 

 

18.07

 

Vested

 

 

(420,083

)

 

 

11.41

 

Canceled, forfeited or expired

 

 

(57,778

)

 

 

8.35

 

Outstanding as of December 31, 2022

 

 

1,546,002

 

 

$

9.29

 

 
Performance-Based Restricted Stock Units  
Nonvested Restricted Stock Shares Activity

The following summarizes TimkenSteel stock-settled performance-based restricted stock unit activity from January 1, 2022 to December 31, 2022:

 

 

 

Number of
Shares

 

 

Weighted
Average
Grant Date
Fair Value

 

Outstanding as of December 31, 2021

 

 

794,044

 

 

$

6.91

 

Granted

 

 

178,467

 

 

 

25.04

 

Canceled, forfeited or expired

 

 

(4,096

)

 

 

15.64

 

Outstanding as of December 31, 2022

 

 

968,415

 

 

$

10.21

 
v3.22.4
Accumulated Other Comprehensive Income (Loss) (Tables)
 12 Months Ended
Dec. 31, 2022
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]  
Schedule of Accumulated Other Comprehensive Income (Loss)

Changes in accumulated other comprehensive income (loss) for the years ended December 31, 2022 and 2021 by component were as follows:

 

 

 

Foreign Currency
Translation
Adjustments

 

 

Pension and
Postretirement
Liability
Adjustments

 

 

Total

 

Balance as of December 31, 2021

 

$

(5.1

)

 

$

25.8

 

 

$

20.7

 

Other comprehensive income before reclassifications, before income tax

 

 

(1.7

)

 

 

—

 

 

 

(1.7

)

Amounts reclassified from accumulated other comprehensive income
   (loss), before income tax

 

—

 

 

 

(4.7

)

 

 

(4.7

)

Amounts deferred to accumulated other comprehensive income
   (loss), before income tax

 

—

 

 

 

—

 

 

 

—

 

Tax effect

 

—

 

 

 

0.4

 

 

 

0.4

 

Net current period other comprehensive income (loss), net of income taxes

 

 

(1.7

)

 

 

(4.3

)

 

 

(6.0

)

Balance as of December 31, 2022

 

$

(6.8

)

 

$

21.5

 

 

$

14.7

 

 

 

 

Foreign Currency
Translation
Adjustments

 

 

Pension and
Postretirement
Liability
Adjustments

 

 

Total

 

Balance as of December 31, 2020

 

$

(5.4

)

 

$

45.8

 

 

$

40.4

 

Other comprehensive income before reclassifications, before income tax

 

 

0.3

 

 

 

—

 

 

 

0.3

 

Amounts reclassified from accumulated other comprehensive income
   (loss), before income tax

 

—

 

 

 

(5.8

)

 

 

(5.8

)

Amounts deferred to accumulated other comprehensive income
   (loss), before income tax

 

—

 

 

 

(14.2

)

 

 

(14.2

)

Tax effect

 

—

 

 

 

—

 

 

 

—

 

Net current period other comprehensive income (loss), net of income taxes

 

 

0.3

 

 

 

(20.0

)

 

 

(19.7

)

Balance as of December 31, 2021

 

$

(5.1

)

 

$

25.8

 

 

$

20.7

 

 
v3.22.4
Basis of Presentation - Narrative (Details)
Tons in Millions, T in Millions
 3 Months Ended 12 Months Ended
Mar. 31, 2021
Tons
T
Dec. 31, 2022
Tons
T
Organization, Consolidation and Presentation of Financial Statements [Abstract]    
Annual Melt Capacity | T 2.0 1.2
Annual Shipment Capacity | Tons 1.5 0.9
v3.22.4
Significant Accounting Policies - Narrative (Details) - USD ($)
$ in Millions
 3 Months Ended 12 Months Ended
Jan. 01, 2021
Mar. 31, 2022
Dec. 31, 2021
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
New Accounting Pronouncements Or Change In Accounting Principle [Line Items]            
Restricted Cash       $ 0.6    
Warranty claims       0.7 $ 1.4 $ 0.0
Foreign currency exchange gains (losses)       0.2 (0.1) (0.2)
Research and development       0.8 1.7 1.8
Retained deficit     $ 188.2 123.1 188.2  
Proceeds from issuance of internal revenue service     0.5      
Cash proceeds from issuance of remaining internal revenue service   $ 1.8        
Coronavirus Aid Relief And Economic Security Act            
New Accounting Pronouncements Or Change In Accounting Principle [Line Items]            
Deferred cash payments of payroll taxes     $ 3.2 $ 3.2 $ 3.2 6.4
Accrued benefit           $ 2.3
ASU 2020-06 | Revision of Prior Period, Accounting Standards Update, Adjustment            
New Accounting Pronouncements Or Change In Accounting Principle [Line Items]            
Decrease to additional paid in capital $ 10.6          
Increase to current convertible notes net 1.1          
Increase to non-current convertible notes net 5.3          
Retained deficit $ 4.2          
Building            
New Accounting Pronouncements Or Change In Accounting Principle [Line Items]            
Useful lives of property, plant and equipment, net       30 years    
Minimum            
New Accounting Pronouncements Or Change In Accounting Principle [Line Items]            
Useful lives of intangible asses, net       3 years    
Minimum | Machinery and Equipment            
New Accounting Pronouncements Or Change In Accounting Principle [Line Items]            
Useful lives of property, plant and equipment, net       3 years    
Maximum            
New Accounting Pronouncements Or Change In Accounting Principle [Line Items]            
Useful lives of intangible asses, net       15 years    
Maximum | Machinery and Equipment            
New Accounting Pronouncements Or Change In Accounting Principle [Line Items]            
Useful lives of property, plant and equipment, net       20 years    
v3.22.4
Segment Information (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Revenues from External Customers and Long-Lived Assets [Line Items]      
Net sales $ 1,329.9 $ 1,282.9 $ 830.7
Long-lived assets, net 503.6 531.4  
United States      
Revenues from External Customers and Long-Lived Assets [Line Items]      
Net sales 1,201.3 1,166.1 746.8
Long-lived assets, net 503.0 530.7  
Foreign      
Revenues from External Customers and Long-Lived Assets [Line Items]      
Net sales 128.6 116.8 $ 83.9
Long-lived assets, net $ 0.6 $ 0.7  
v3.22.4
Revenue Recognition (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Disaggregation of Revenue [Line Items]      
Net sales $ 1,329.9 $ 1,282.9 $ 830.7
Bar      
Disaggregation of Revenue [Line Items]      
Net sales 887.4 863.6 502.5
Tube      
Disaggregation of Revenue [Line Items]      
Net sales 173.7 164.4 101.4
Manufactured Components      
Disaggregation of Revenue [Line Items]      
Net sales 243.3 224.0 208.1
Other      
Disaggregation of Revenue [Line Items]      
Net sales [1] 25.5 30.9 18.7
Mobile      
Disaggregation of Revenue [Line Items]      
Net sales 539.1 527.9 346.0
Industrial      
Disaggregation of Revenue [Line Items]      
Net sales 628.7 661.2 391.7
Energy      
Disaggregation of Revenue [Line Items]      
Net sales 136.6 62.9 53.2
Other      
Disaggregation of Revenue [Line Items]      
Net sales [2] $ 25.5 $ 30.9 $ 39.8
[1] “Other” for sales by product type relates to the Company’s scrap sales.
[2] “Other” sales by end-market sector includes the Company’s scrap sales. In addition, 2020 includes oil country tubular goods billet sales.
v3.22.4
Revenue Recognition - Narrative (Details) - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
Revenue from Contract with Customer [Abstract]    
Contract liabilities totalated $ 3.6 $ 0.1
v3.22.4
Restructuring Charges - Narrative (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Restructuring and Related Activities [Abstract]      
Restructuring charges $ 0.8 $ 6.7 $ 3.1
Restructuring charges related to severance and employee-related benefits   6.4  
Restructuring charges related to transition of customers to other manufacturing equipment   $ 0.3  
v3.22.4
Restructuring Charges - Summary of Restructuring Reserve (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Restructuring Reserve [Roll Forward]      
Beginning balance $ 4.7 $ 1.5  
Expenses 0.8 6.7 $ 3.1
Payments (5.0) (3.5)  
Ending balance $ 0.5 $ 4.7 $ 1.5
v3.22.4
Disposition of Non-Core Assets (Details)
 3 Months Ended 12 Months Ended
Dec. 31, 2022
USD ($)
Dec. 31, 2021
USD ($)
Program
Sep. 30, 2021
USD ($)
Mar. 31, 2021
USD ($)
Mar. 31, 2020
USD ($)
Dec. 31, 2019
USD ($)
Dec. 31, 2022
USD ($)
Dec. 31, 2021
USD ($)
Dec. 31, 2020
USD ($)
Dec. 31, 2019
USD ($)
Jun. 30, 2020
USD ($)
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]                      
Disposal Group, Not Discontinued Operation, Gain (Loss) on Disposal, Statement of Income or Comprehensive Income [Extensible Enumeration]                 Loss (gain) on sale or disposal of assets    
Inventory valuation reserves $ 500,000 $ 800,000         $ 500,000 $ 800,000      
Inventory 192,400,000 210,900,000         192,400,000 210,900,000      
Assets held for sale 0 4,300,000         0 4,300,000      
Impairment charges related to the indefinite idling of assets               10,600,000      
Impairment, Long-Lived Asset, Held-for-Use, Statement of Income or Comprehensive Income [Extensible Enumeration]       Impairment charges              
Proceeds from sale of consolidated subsidiary, net             0 6,200,000 $ 0    
Loss on sale of consolidated subsidiary             0 1,100,000 0    
Proceeds from sale, down payment             5,400,000 1,200,000 10,900,000    
Early termination reimbursement from customer 4,300,000                    
TimkenSteel (Shanghai) Corporation Limited | Daido Steel (Shanghai) Co., Ltd.                      
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]                      
Proceeds from sale of consolidated subsidiary, net     $ 6,200,000                
Loss on sale of consolidated subsidiary     $ (1,100,000)                
Harrison Facility | Melt and Cast Related Assets                      
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]                      
Non-cash charges related to write down of assets       $ 9,500,000              
St.Clair Facility                      
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]                      
Inventory write-down               200,000      
Impairment charges               2,400,000      
Capital recovery remaining amount to be recognized   $ 1,100,000                  
Number of customer program early termination | Program   2                  
Machinery and Equipment | Harrison Facility | Melt and Cast Related Assets                      
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]                      
Non-cash charges related to write down of assets       7,900,000              
Spare Parts | Harrison Facility | Melt and Cast Related Assets                      
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]                      
Non-cash charges related to write down of assets       1,600,000              
Disposal Group, Held-for-sale, Not Discontinued Operation                      
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]                      
Accelerated depreciation         $ 1,600,000 $ 2,800,000          
Gain (loss) on sale/disposal   $ 100,000             3,600,000    
Inventory write-down                   $ 4,800,000  
Inventory valuation reserves                     $ 3,100,000
Inventory   0           0      
Impairment charges               300,000      
Proceeds from sale of land   300,000                  
Assets held for sale   $ 4,300,000           $ 4,300,000      
Net cash proceeds 2,800,000           2,800,000        
Loss on sale of assets 1,500,000           1,500,000        
Disposal Group, Held-for-sale, Not Discontinued Operation | Machinery and Equipment                      
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]                      
Accelerated depreciation       1,500,000         $ 1,800,000    
Gain (loss) on sale/disposal             3,400,000        
Proceeds from sale, down payment $ 1,700,000                    
Expected additional payment on disposal             $ 1,700,000        
Expected date of additional payment, description.             The Company expects to receive an additional $1.7 million in the first half of 2023, resulting in a gain of disposal of assets of $3.4 million.        
Disposal Group, Held-for-sale, Not Discontinued Operation | Spare Parts                      
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]                      
Impairment charges related to the indefinite idling of assets       $ 500,000              
v3.22.4
Other (Income) Expense , Net (Details) - USD ($)
$ in Millions
 3 Months Ended 12 Months Ended
Dec. 31, 2022
Sep. 30, 2022
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Other Income and Expenses [Abstract]          
Pension and postretirement non-service benefit (income) loss     $ (20.3) $ (37.2) $ (26.6)
Loss (gain) from remeasurement of benefit plans     (35.4) (20.1) 14.7
Foreign currency exchange loss (gain)     (0.2) 0.1 0.2
Insurance recoveries $ (33.0) $ (1.5) (34.5) 0.0 0.0
Sales and use tax refund     0.0 (2.5) 0.0
Employee retention credit     0.0 0.0 (2.3)
Miscellaneous (income) expense     (0.2) 0.2 (0.2)
Total other (income) expense, net     $ (90.6) $ (59.5) $ (14.2)
v3.22.4
Other (Income) Expense , Net - Narrative (Details) - USD ($)
$ in Millions
 3 Months Ended 12 Months Ended
Mar. 31, 2023
Dec. 31, 2022
Sep. 30, 2022
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Statutory Accounting Practices [Line Items]            
Sales and use taxes refund       $ 0.0 $ 2.5 $ 0.0
Employee retention credit       0.0 0.0 2.3
Loss (gain) from remeasurement of benefit plans       (35.4) (20.1) 14.7
Investment gains on plan assets       359.9 55.7  
Investment losses on plan assets       (327.2) (35.6)  
Gain on insurance proceeds received   $ 33.0 $ 1.5 34.5 $ 0.0 $ 0.0
Total recovery $ 20.0 $ 13.0        
Non cash settlement related to bargaining plan       $ 2.7    
v3.22.4
Income Tax Provision - Income from Operations Before Income Taxes Based on Geographic Location of Operations (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Income Tax Disclosure [Abstract]      
United States $ 108.5 $ 171.2 $ (64.1)
Non-United States (11.4) 5.5 3.4
Income (loss) from operations before income taxes $ 97.1 $ 176.7 $ (60.7)
v3.22.4
Income Tax Provision - (Benefit) Provision for Income Taxes (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Current:      
Federal $ 0.6 $ 0.2 $ 0.6
State and local 5.7 3.7 0.0
Foreign 0.8 0.6 0.5
Total current tax expense (benefit) 7.1 4.5 1.1
Deferred:      
Federal 24.2 0.8 (0.4)
State and local 0.7 0.3 0.5
Foreign 0.0 0.1 0.0
Total deferred tax expense (benefit) 24.9 1.2 0.1
Provision (benefit) for incomes taxes $ 32.0 $ 5.7 $ 1.2
v3.22.4
Income Tax Provision - Narrative (Details) - USD ($)
 3 Months Ended 12 Months Ended
Sep. 30, 2021
Jun. 30, 2021
Sep. 30, 2020
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Operating Loss Carryforwards [Line Items]            
State and local tax payments       $ 5,700,000 $ 3,700,000 $ 0
Income Taxes Receivable, Current       $ 2,200,000    
Dividends declared     $ 5,100,000      
Dividend declared and paid $ 400,000 $ 800,000        
Open tax year       2019 2020 2021 2022    
Deferred Tax Liabilities, Undistributed Foreign Earnings       $ 0 0 300,000
Deferred income taxes       25,900,000 2,200,000  
Operating Loss Carryforwards       71,700,000    
Unrecognized Tax Benefits       0 0 0
Unrecognized Tax Benefits that Would Impact Effective Tax Rate       0 0 0
Unrecognized Tax Benefits, Income Tax Penalties and Interest Accrued       0 0 $ 0
Foreign            
Operating Loss Carryforwards [Line Items]            
Income Taxes Paid       200,000    
Foreign tax payments         900,000  
Operating Loss Carryforwards       54,500,000    
State and Local            
Operating Loss Carryforwards [Line Items]            
Income Taxes Paid       5,000,000.0    
State and local tax payments         4,600,000  
Income Taxes Receivable, Current         0  
U.S.            
Operating Loss Carryforwards [Line Items]            
Income Taxes Paid       2,000,000.0    
U.S federal payments         $ 0  
Operating Loss Carryforwards       $ 17,200,000    
v3.22.4
Income Tax Provision - Reconciliation Between Effective Tax Rate and Statutory Rate (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Income Tax Disclosure [Abstract]      
U.S. federal income tax provision (benefit) at statutory rate $ 20.4 $ 37.1 $ (12.7)
Adjustments:      
State and local income taxes, net of federal tax benefit 8.4 4.1 2.3
Permanent differences 8.9 (0.2) 1.3
Foreign earnings taxed at different rates 3.6 (0.5) 0.1
Valuation allowance (2.5) (34.8) 10.3
U.S. research tax credit (0.6) 0.0 0.0
Global intangible low-taxed income 0.0 0.0 0.0
Other items, net 1.0 (0.0) (0.1)
Provision (benefit) for incomes taxes $ 32.0 $ 5.7 $ 1.2
Effective tax rate 32.90% 3.20% (2.00%)
v3.22.4
Income Tax Provision - Effect of Temporary Differences Giving Rise to Deferred Tax Assets and Liabilities (Details) - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
Deferred tax liabilities:    
Depreciation $ (81.4) $ (89.0)
Inventory 0.0 (8.0)
Leases - right-of-use asset (3.1) (3.5)
Deferred tax liabilities (84.5) (100.5)
Deferred tax assets:    
Tax loss carryforwards 20.5 52.6
Pension and postretirement benefits 35.5 44.3
Other employee benefit accruals 6.6 8.2
Lease liability 3.1 3.5
State decoupling 0.8 1.3
Accrued restructuring 0.1 1.1
Capital loss carryforward 0.8 0.8
Intangible assets 0.2 0.6
Inventory 0.7 0.6
Allowance for doubtful accounts 0.3 0.5
Accrued Legal 2.0 0.0
Capitalized R&D 0.9 0.0
Other, net 0.1 0.3
Deferred tax assets subtotal 71.6 113.8
Valuation allowances (13.0) (15.5)
Deferred tax assets 58.6 98.3
Net deferred tax assets (liabilities) $ (25.9) $ (2.2)
v3.22.4
Earnings (Loss) Per Share - Additional Information (Details) - USD ($)
shares in Millions, $ in Millions
 6 Months Ended 12 Months Ended
Jun. 30, 2022
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]        
Shares assumed purchased   3.2 3.0  
Shares assumed purchased with potential proceeds   1.1 1.3  
Repurchase of convertible notes   $ 67.6 $ 38.9 $ 0.0
Convertible Senior Notes due 2025        
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]        
Antidilutive securities excluded from calculation of computation of diluted earnings (loss) per share   2.3    
Convertible notes repurchased outstanding principal amount $ 25.2      
Repurchase of convertible notes 67.6      
Debt Instrument, Face Amount $ 25.2      
Convertible Notes [Member]        
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]        
Antidilutive securities excluded from calculation of computation of diluted earnings (loss) per share   3.6 7.4 9.1
Employee Stock [Member]        
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]        
Antidilutive securities excluded from calculation of computation of diluted earnings (loss) per share   0.8 1.8  
Equity-based Awards [Member]        
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]        
Antidilutive securities excluded from calculation of computation of diluted earnings (loss) per share   4.0 4.8 4.6
v3.22.4
Earnings (Loss) Per Share - Schedule of Earnings Per Share (Details) - USD ($)
$ / shares in Units, shares in Millions, $ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Numerator:      
Net income (loss), basic $ 65.1 $ 171.0 $ (61.9)
Add convertible notes interest 1.9 4.1 0.0
Net income (loss), diluted $ 67.0 $ 175.1 $ (61.9)
Denominator:      
Weighted average shares outstanding, basic (in shares) 45.8 45.9 45.0
Dilutive effect of equity-based awards (in shares) 2.1 1.7 0.0
Dilutive effect of convertible notes (in shares) 3.6 7.4 0.0
Weighted average shares outstanding, diluted (in shares) 51.5 55.0 45.0
Basic earnings (loss) per share $ 1.42 $ 3.73 $ (1.38)
Diluted earnings (loss) per share $ 1.30 $ 3.18 $ (1.38)
v3.22.4
Inventories - Schedule of Inventory (Details) - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
Inventory Disclosure [Abstract]    
Manufacturing supplies $ 36.9 $ 29.3
Raw materials 23.9 37.3
Work in process 94.7 89.3
Finished products 37.4 55.8
Gross inventory 192.9 211.7
Allowance for inventory reserves (0.5) (0.8)
Total inventories, net $ 192.4 $ 210.9
v3.22.4
Property, Plant and Equipment - Schedule of Property, Plant and Equipment (Details) - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
Property, Plant and Equipment [Abstract]    
Land $ 11.2 $ 11.2
Buildings and improvements 414.6 415.0
Machinery and equipment 1,391.5 1,391.9
Construction in progress 30.8 9.6
Subtotal 1,848.1 1,827.7
Less allowances for depreciation (1,362.0) (1,317.5)
Property, plant and equipment, net $ 486.1 $ 510.2
v3.22.4
Property, Plant and Equipment - Narrative (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Property, Plant and Equipment [Abstract]      
Depreciation $ 55.5 $ 59.8 $ 65.0
Accelerated depreciation   1.5 2.4
Impairment charges and loss on sale $ 1.9 1.3 $ 2.6
Impairment charges related to the indefinite idling of assets   $ 10.6  
v3.22.4
Property, Plant and Equipment - Schedule of Supplemental Cash Flow Information Related to Non-Cash Investing Activity (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2019
Supplemental Cash Flow Elements [Abstract]      
Accrued property, plant and equipment purchases $ 10.6 $ 3.6 $ 2.0
v3.22.4
Intangible Assets - Schedule of Intangible Assets (Details) - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
Finite-Lived Intangible Assets [Line Items]    
Gross Carrying Amount $ 73.2 $ 72.7
Accumulated Amortization 68.2 66.0
Net Carrying Amount 5.0 6.7
Customer relationships    
Finite-Lived Intangible Assets [Line Items]    
Gross Carrying Amount 6.3 6.3
Accumulated Amortization 6.2 5.8
Net Carrying Amount 0.1 0.5
Technology use    
Finite-Lived Intangible Assets [Line Items]    
Gross Carrying Amount 9.0 9.0
Accumulated Amortization 9.0 9.0
Capitalized software    
Finite-Lived Intangible Assets [Line Items]    
Gross Carrying Amount 57.9 57.4
Accumulated Amortization 53.0 51.2
Net Carrying Amount $ 4.9 $ 6.2
v3.22.4
Intangible Assets - Narrative (Details) - USD ($)
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Finite-Lived Intangible Assets [Line Items]      
Weighted average remaining useful life 8 years    
Amortization expense for intangible assets $ 2,800,000 $ 3,300,000 $ 5,000,000.0
Loss on disposal of intangibles $ 0 $ 0 200,000
Customer relationships      
Finite-Lived Intangible Assets [Line Items]      
Weighted average remaining useful life 15 years    
Technology use      
Finite-Lived Intangible Assets [Line Items]      
Weighted average remaining useful life 15 years    
Capitalized software      
Finite-Lived Intangible Assets [Line Items]      
Weighted average remaining useful life 6 years    
Accelerated amortization expense     $ 1,000,000.0
v3.22.4
Intangible Assets - Estimated Annual Amortization Expense (Details)
$ in Millions
Dec. 31, 2022
USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]  
2023 $ 2.3
2024 1.3
2025 0.3
2026 0.1
2027 $ 0.1
v3.22.4
Leases - Narrative (Details)
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Lessee, Lease, Description [Line Items]    
Lessee, operating lease, option to extend true  
Extension term 1 year  
Weighted average remaining lease term for operating leases 2 years 6 months  
Weighted average discount rate used to measure operating lease liabilities 3.10% 2.70%
Minimum    
Lessee, Lease, Description [Line Items]    
Remaining lease term 1 year  
Maximum    
Lessee, Lease, Description [Line Items]    
Remaining lease term 5 years  
v3.22.4
Leases - Lease Cost (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Leases [Abstract]      
Operating lease cost $ 6.7 $ 8.2 $ 8.8
Short-term lease cost 0.9 0.7 0.7
Total lease cost $ 7.6 $ 8.9 $ 9.5
v3.22.4
Leases - Supplemental Cash Flow Information (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Leases [Abstract]      
Cash paid for amounts included in the measurement of operating lease liabilities $ 6.7 $ 8.2 $ 8.8
Right-of-use assets obtained in exchange for operating lease obligations $ 4.5 $ 3.1 $ 12.5
v3.22.4
Leases - Future Minimum Lease Payments (Details)
$ in Millions
Dec. 31, 2022
USD ($)
Leases [Abstract]  
2023 $ 6.3
2024 4.0
2025 1.9
2026 0.5
After 2026 0.3
Total future minimum lease payments 13.0
Less amount of lease payment representing interest (0.5)
Total present value of lease payments $ 12.5
v3.22.4
Financing Arrangements - Summary of Current and Non-current Debt (Details) - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
Debt Instrument [Line Items]    
Total debt $ 20.4 $ 44.9
Less current portion of debt 20.4 44.9
Total non-current portion of debt 0.0 0.0
Convertible Senior Notes due 2021    
Debt Instrument [Line Items]    
Total debt   0.0
Convertible Senior Notes due 2025    
Debt Instrument [Line Items]    
Total debt $ 20.4 $ 44.9
v3.22.4
Financing Arrangements - Narrative (Details)
$ / shares in Units, shares in Millions
 1 Months Ended 6 Months Ended 12 Months Ended
Dec. 15, 2020
USD ($)
$ / shares
Dec. 31, 2020
USD ($)
May 31, 2016
USD ($)
$ / shares
Jun. 30, 2022
USD ($)
Dec. 31, 2022
USD ($)
Days
$ / shares
shares
Dec. 31, 2021
USD ($)
Dec. 31, 2020
USD ($)
Feb. 24, 2023
USD ($)
Jan. 01, 2023
USD ($)
$ / shares
shares
Nov. 02, 2022
USD ($)
Dec. 20, 2021
shares
Debt Instrument [Line Items]                      
Settled with cash payment         $ 67,600,000 $ 38,900,000 $ 0        
Loss on extinguishment of debt         43,100,000 0 900,000        
Initial value of principal         20,400,000 44,900,000          
Interest paid         3,100,000 5,100,000 7,600,000        
Money market investment carrying value   $ 0     $ 209,500,000 0 0        
Common Stock, Shares outstanding | shares                     50.0
Stock Repurchase Program, Amount                   $ 75,000,000.0  
Common Shares                      
Debt Instrument [Line Items]                      
Stock Repurchase Program, Amount   0       0 0        
Shares repurchased | shares         3.0            
Aggregate cost         $ 52,000,000.0            
Average repurchase price | $ / shares         $ 17.18            
Stock Repurchase Program, Remaining Amount         $ 73,000,000.0            
Subsequent Event | Common Shares                      
Debt Instrument [Line Items]                      
Shares repurchased | shares                 0.2    
Aggregate cost                 $ 4,500,000    
Average repurchase price | $ / shares                 $ 19.19    
Stock Repurchase Program, Remaining Amount               $ 68,500,000      
Convertible Notes                      
Debt Instrument [Line Items]                      
Final cash payment of interest made to noteholders         $ 1,800,000 4,100,000 10,100,000        
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate [Member]                      
Debt Instrument [Line Items]                      
Variable interest rate, spread         0.00%            
Third Amended Credit Facility [Member]                      
Debt Instrument [Line Items]                      
Maturity date         Sep. 30, 2027            
Fourth Amended Credit Facility [Member]                      
Debt Instrument [Line Items]                      
Line of credit facility, maximum borrowing capacity         $ 400,000,000.0            
Line of credit facility, tentative future commitment increase         $ 100,000,000.0            
Variable interest rate, spread         1.00%            
Line of credit facility, unused capacity, commitment fee percentage         0.25%            
Convertible Senior Notes due 2021, Issuance One | Convertible Notes                      
Debt Instrument [Line Items]                      
Debt Instrument, Face Amount     $ 75,000,000.0                
Convertible Senior Notes due 2021, Over-allotment | Convertible Notes                      
Debt Instrument [Line Items]                      
Debt Instrument, Face Amount     11,300,000                
Convertible Senior Notes due 2021                      
Debt Instrument [Line Items]                      
Maturity date         Jun. 01, 2021            
Terms of conversion         The Convertible Senior Notes due 2021 were settled with a cash payment of $38.9 million and the issuance of shares of 0.1 million, as most noteholders exercised the conversion option prior to the date of maturity.            
Principal amount           0          
Settlement through issuance of shares | shares         0.1            
Final cash payment of interest made to noteholders         $ 1,200,000            
Initial value of principal     $ 66,900,000                
Effective interest rate     12.00%                
Principal amount allocated to conversion feature     $ 19,400,000                
Transaction costs, liability component of convertible debt     2,400,000                
Transaction costs, equity component of convertible debt     $ 700,000                
Exchange of aggregate principal amount   46,000,000.0                  
Convertible senior notes deemed to be extinguished   46,000,000.0                  
Convertible Senior Notes due 2021 | Convertible Notes                      
Debt Instrument [Line Items]                      
Maturity date     Jun. 01, 2021                
Debt instrument, interest rate, stated percentage     6.00%                
Debt instrument interest payment dates description     June 1 and December 1 of each year, beginning on December 1, 2016                
Debt instrument, convertible, conversion price | $ / shares     $ 12.58                
Debt instrument, convertible, conversion ratio     0.0795165                
Debt instrument, convertible, amounts by which instrument can be converted     $ 1,000                
Proceeds from convertible debt     $ 83,200,000                
Convertible Senior Notes due 2025                      
Debt Instrument [Line Items]                      
Line of credit facility, maximum borrowing capacity   $ 46,000,000.0         $ 46,000,000.0        
Maturity date Dec. 01, 2025                    
Terms of conversion         The Convertible Senior Notes due 2025 are convertible at the option of the holders in certain circumstances and during certain periods into the Company's common shares, cash, or a combination thereof, at the Company's election.            
Debt Instrument, Face Amount       $ 25,200,000              
Principal amount         $ 20,800,000 46,000,000.0          
Settled with cash payment       67,600,000              
Debt instrument, threshold trading days | Days         20            
Debt Instrument, threshold consecutive trading days | Days         30            
Debt Instrument, threshold Percentage of stock price conversion         130.00%            
Loss on extinguishment of debt       (43,000,000.0)              
Unamortized debt issuance cost       $ 600,000              
Debt instrument, interest rate, stated percentage 6.00% 6.00%         6.00%        
Debt instrument interest payment dates description June 1 and December 1 of each year, beginning on December 1, 2021                    
Debt instrument, convertible, conversion price | $ / shares $ 7.82                    
Debt instrument, convertible, conversion ratio 0.1278119                    
Debt instrument, convertible, amounts by which instrument can be converted $ 1,000,000,000                    
Initial value of principal         $ 20,400,000 44,900,000          
Transaction costs, debt gross         1,500,000            
Cash proceeds from issuance of convertible senior notes   $ 0                  
Percentage of different from present value of remaining cash flows of convertible senior notes   10.00%                  
Fair value of convertible notes         53,400,000 107,000,000.0          
Outstanding borrowings         0 0          
Convertible Senior Notes due 2021                      
Debt Instrument [Line Items]                      
Settled with cash payment         38,900,000            
Loss on extinguishment of debt 900,000                    
Initial value of principal           $ 0          
Fair value of extinguished portion calculated using market rate   9.00%                  
Debt instrument remaining term   5 months 15 days                  
Remaining accrued and unpaid interest of debt 46,000,000.0                    
Payment of accrued and unpaid interest of debt $ 100,000                    
Credit Agreement | Third Amended Credit Facility [Member]                      
Debt Instrument [Line Items]                      
Line of credit facility, tentative future commitment increase         233,500,000            
Outstanding borrowings         0            
Commercial and Standby Letters of Credit | Fourth Amended Credit Facility [Member]                      
Debt Instrument [Line Items]                      
Line of credit facility, borrowing sublimit         15,000,000.0            
Swingline Loans | Fourth Amended Credit Facility [Member]                      
Debt Instrument [Line Items]                      
Line of credit facility, borrowing sublimit         40,000,000.0            
First In, Last Out (FILO) | Fourth Amended Credit Facility [Member]                      
Debt Instrument [Line Items]                      
Line of credit facility, tentative future commitment increase         $ 30,000,000.0            
v3.22.4
Financing Arrangements - Schedule of Net Carrying Amount of Extinguished Convertible Senior Notes (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 15, 2020
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Debt Instrument [Line Items]        
Loss on extinguishment of debt   $ (43.1) $ 0.0 $ (0.9)
Convertible Senior Notes due 2021        
Debt Instrument [Line Items]        
Principal $ 46.0      
Less: Debt issuance costs, net of amortization (0.1)      
Less: Debt discount, net of amortization (1.5)      
Fair value of extinguished Convertible Senior Notes due 2021 as of December 15, 2020 45.3      
Loss on extinguishment of debt $ (0.9)      
v3.22.4
Financing Arrangements - Schedule of Amount Allocated to Reacquisition of Equity Component Included as Reduction To Additional Paid-In Capital (Details) - Convertible Senior Notes due 2021
$ in Millions
Dec. 15, 2020
USD ($)
Debt Instrument [Line Items]  
Fair value of extinguished Convertible Senior Notes due 2021 as of December 15, 2020 $ 45.3
Principal of extinguished Convertible Senior Notes due 2021 46.0
Reduction of additional paid-in capital $ (0.7)
v3.22.4
Financing Arrangements - Schedule of Convertible Debt (Details) - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
May 31, 2016
Debt Instrument [Line Items]      
Total debt $ 20.4 $ 44.9  
Convertible Senior Notes due 2021      
Debt Instrument [Line Items]      
Principal   0.0  
Total debt     $ 66.9
Convertible Senior Notes due 2025      
Debt Instrument [Line Items]      
Principal 20.8 46.0  
Less: Debt issuance costs, net of amortization (0.4) (1.1)  
Less: Debt discount, net of amortization   0.0  
Total debt $ 20.4 $ 44.9  
v3.22.4
Financing Arrangements - Schedule Components of Interest Expense (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Debt Disclosure [Abstract]      
Interest expense $ 3.9 $ 6.2 $ 12.6
Interest income (3.3) (0.3) (0.4)
Interest (income) expense, net $ 0.6 $ 5.9 $ 12.2
v3.22.4
Financing Arrangements - Schedule of Interest Expense (Details) - Convertible Notes - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Debt Instrument [Line Items]      
Contractual interest expense $ 1.7 $ 3.7 $ 5.2
Amortization of debt issuance costs 0.1 0.4 0.5
Amortization of debt discount 0.0 0.0 4.4
Total $ 1.8 $ 4.1 $ 10.1
v3.22.4
Retirement and Postretirement Plans - Narrative (Details) - USD ($)
$ in Millions
 1 Months Ended 3 Months Ended 12 Months Ended
Jul. 07, 2022
Oct. 29, 2021
Sep. 30, 2022
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]            
Pension cost and other postretirement benefits cost (reversal of cost), remeasurement       $ (35.4) $ (20.1) $ 14.7
Defined contribution plan cost       3.3 2.8 3.2
Bargaining Plan            
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]            
Defined benefit plan term of contract   4 years        
Defined benefit plan contract expiration date   Sep. 27, 2025        
Increased in pension liability         14.2  
Bargaining Plan's obligations $ 256.2          
Settlement gain     $ 2.7      
Accumulated benefit obligation for plans which the accumulated benefit obligation exceeded the fair value of plan assets       468.9    
Postretirement            
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]            
Settlement gain       $ 11.8 4.9 (2.6)
Benefit plan terminated effective date       Mar. 31, 2022    
Expected annuity purchase year       2023    
Expected contributions and payments from 2024 through 2032       $ 34.3    
Pension            
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]            
Settlement gain       20.9 15.2 $ (12.1)
Settlements       363.1 31.1  
Retirement plan expenses       5.1 3.0  
Accumulated benefit obligation       660.6 $ 1,303.2  
Expected contributions and payments from 2024 through 2032       278.9    
Supplemental Plan            
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]            
Accumulated benefit obligation for plans which the accumulated benefit obligation exceeded the fair value of plan assets       15.7    
Medical and Prescription Drug Benefits            
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]            
Health care cost trend rate         10.00%  
Pension and Postretirement Plans            
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]            
Expected contributions and payments in next 12 months       3.2    
Expected contributions and payments from 2024 through 2032       $ 224.8    
v3.22.4
Retirement and Postretirement Plans - Change in Benefit Obligations (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Pension      
Change in benefit obligation:      
Benefit obligation at the beginning of year $ 1,319.2 $ 1,395.1  
Service cost 14.2 17.4 $ 19.4
Interest cost 39.6 36.2 42.7
Actuarial (gains) losses (269.4) (37.9)  
Benefits paid (65.7) (73.9)  
Plan amendment   14.2  
Settlements (363.1) (31.1)  
Foreign currency translation adjustment (8.2) (0.8)  
Benefit obligation at the end of year 666.6 1,319.2 1,395.1
Pension | United States of America | Bargaining Plan      
Change in benefit obligation:      
Benefit obligation at the beginning of year 1,025.4 1,053.9  
Service cost 13.9 17.0 16.9
Interest cost 31.1 28.4 33.3
Actuarial (gains) losses (203.6) (31.6)  
Benefits paid (51.0) (56.5)  
Plan amendment   14.2  
Settlements (340.9)    
Benefit obligation at the end of year 474.9 1,025.4 1,053.9
Pension | United States of America | Salaried Plan      
Change in benefit obligation:      
Benefit obligation at the beginning of year 187.4 228.7  
Service cost 0.3 0.4 2.5
Interest cost 6.5 5.9 7.0
Actuarial (gains) losses (34.0) (5.1)  
Benefits paid (11.6) (11.4)  
Settlements (20.5) (31.1)  
Benefit obligation at the end of year 128.1 187.4 228.7
Pension | United States of America | Supplemental Plan      
Change in benefit obligation:      
Benefit obligation at the beginning of year 23.6 $ 27.3  
Defined Benefit Plan, Net Periodic Benefit Cost (Credit), Interest Cost, Statement of Income or Comprehensive Income [Extensible Enumeration]   Liability, Defined Benefit Plan, Noncurrent  
Interest cost 0.7 $ 0.8 0.9
Actuarial (gains) losses (6.5) (1.5)  
Benefits paid (0.6) (3.0)  
Settlements (1.7)    
Benefit obligation at the end of year 15.5 23.6 27.3
Pension | United Kingdom | Pension Scheme      
Change in benefit obligation:      
Benefit obligation at the beginning of year 82.4 84.8  
Service cost     0.0
Interest cost 1.3 1.1 1.5
Actuarial (gains) losses (25.3) 0.3  
Benefits paid (2.5) (3.0)  
Foreign currency translation adjustment (8.2) (0.8)  
Benefit obligation at the end of year 47.7 82.4 84.8
Pension | Mexico | Pension Plan      
Change in benefit obligation:      
Benefit obligation at the beginning of year 0.4 0.4  
Actuarial (gains) losses   0.0  
Benefit obligation at the end of year 0.4 0.4 0.4
Postretirement      
Change in benefit obligation:      
Benefit obligation at the beginning of year 117.8 128.3  
Service cost 1.1 1.2 1.0
Interest cost 3.4 3.2 4.2
Actuarial (gains) losses (24.0) (6.0)  
Benefits paid (10.9) (8.9)  
Benefit obligation at the end of year $ 87.4 $ 117.8 $ 128.3
v3.22.4
Retirement and Postretirement Plans - Change in Plan Assets (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Pension    
Change in plan assets:    
Fair value of plan assets at the beginning of year $ 1,176.0 $ 1,231.7
Actual return on plan assets (193.6) 44.6
Company contributions / payments 3.6 5.8
Benefits paid (65.7) (73.9)
Settlements (360.4) (31.1)
Foreign currency translation adjustment (10.5) (1.1)
Fair value of plan assets at end of year 549.4 1,176.0
Funded status at end of year (117.2) (143.2)
Pension | United States of America | Bargaining Plan    
Change in plan assets:    
Fair value of plan assets at the beginning of year 862.8 884.3
Actual return on plan assets (119.7) 35.0
Benefits paid (51.0) (56.5)
Settlements (338.2)  
Fair value of plan assets at end of year 353.9 862.8
Funded status at end of year (121.0) (162.6)
Pension | United States of America | Salaried Plan    
Change in plan assets:    
Fair value of plan assets at the beginning of year 205.7 243.3
Actual return on plan assets (35.9) 4.9
Benefits paid (11.6) (11.4)
Settlements (20.5) (31.1)
Fair value of plan assets at end of year 137.7 205.7
Funded status at end of year 9.6 18.3
Pension | United States of America | Supplemental Plan    
Change in plan assets:    
Company contributions / payments 2.3 3.0
Benefits paid (0.6) (3.0)
Settlements (1.7)  
Funded status at end of year (15.5) (23.6)
Pension | United Kingdom | Pension Scheme    
Change in plan assets:    
Fair value of plan assets at the beginning of year 107.2 103.8
Actual return on plan assets (38.0) 4.7
Company contributions / payments 1.3 2.8
Benefits paid (2.5) (3.0)
Foreign currency translation adjustment (10.5) (1.1)
Fair value of plan assets at end of year 57.5 107.2
Funded status at end of year 9.8 24.8
Pension | Mexico | Pension Plan    
Change in plan assets:    
Fair value of plan assets at the beginning of year 0.3 0.3
Fair value of plan assets at end of year 0.3 0.3
Funded status at end of year (0.1) (0.1)
Postretirement    
Change in plan assets:    
Fair value of plan assets at the beginning of year 76.8 82.2
Actual return on plan assets (8.8) 2.4
Company contributions / payments 2.1 1.1
Benefits paid (10.9) (8.9)
Fair value of plan assets at end of year 59.2 76.8
Funded status at end of year $ (28.2) $ (41.0)
v3.22.4
Retirement and Postretirement Plans - Amounts Recognized in the Balance Sheet (Details) - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]    
Non-current assets $ 19.4 $ 43.1
Current liabilities (2.0) (4.3)
Non-current liabilities (162.9) (223.0)
Pension    
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]    
Non-current assets 19.4 43.1
Current liabilities (0.6) (2.6)
Non-current liabilities (136.1) (183.7)
Total assets (liabilities) recognized (117.3) (143.2)
Pension | United States of America | Bargaining Plan    
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]    
Non-current liabilities (121.0) (162.6)
Total assets (liabilities) recognized (121.0) (162.6)
Pension | United States of America | Salaried Plan    
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]    
Non-current assets 9.6 18.3
Total assets (liabilities) recognized 9.6 18.3
Pension | United States of America | Supplemental Plan    
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]    
Current liabilities (0.6) (2.6)
Non-current liabilities (15.0) (21.0)
Total assets (liabilities) recognized (15.6) (23.6)
Pension | United Kingdom | Pension Scheme    
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]    
Non-current assets 9.8 24.8
Total assets (liabilities) recognized 9.8 24.8
Pension | Mexico | Pension Plan    
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]    
Non-current liabilities (0.1) (0.1)
Total assets (liabilities) recognized (0.1) (0.1)
Postretirement    
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]    
Current liabilities (1.4) (1.7)
Non-current liabilities (26.8) (39.3)
Total assets (liabilities) recognized $ (28.2) $ (41.0)
v3.22.4
Retirement and Postretirement Plans - Amounts Recognized in Accumulated Other Comprehensive Income (Loss) (Details) - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
Pension    
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]    
Unrecognized prior service (benefit) cost $ 12.9 $ 14.2
Pension | United States of America | Bargaining Plan    
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]    
Unrecognized prior service (benefit) cost 12.4 13.6
Pension | United Kingdom | Pension Scheme    
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]    
Unrecognized prior service (benefit) cost 0.5 0.6
Postretirement    
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]    
Unrecognized prior service (benefit) cost $ (49.9) $ (55.9)
v3.22.4
Retirement and Postretirement Plans - Weighted Average Assumptions (Details)
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Pension    
Benefit Obligation    
Discount rate 5.61% 2.96%
Future compensation assumption 3.00% 3.00%
Benefit Cost    
Discount rate 2.96% 2.68%
Future compensation assumption 3.00% 2.29%
Expected long-term return on plan assets 5.96% 5.76%
Postretirement    
Benefit Obligation    
Discount rate 5.70% 3.00%
Benefit Cost    
Discount rate 3.00% 2.65%
Expected long-term return on plan assets 4.75% 4.50%
v3.22.4
Retirement and Postretirement Plans - Components of Net Periodic Benefit Cost (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Pension      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Service cost $ 14.2 $ 17.4 $ 19.4
Interest cost 39.6 36.2 42.7
Expected return on plan assets (54.9) (67.4) (64.3)
Amortization of prior service cost 1.3 0.2 0.3
Settlements (2.7)    
Curtailments     $ 0.0
Defined Benefit Plan, Net Periodic Benefit (Cost) Credit, Settlement Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration]     Accrued pension and postretirement costs
Net remeasurement losses (gains) (20.9) (15.2) $ 12.1
Net Periodic Benefit Cost (Income) (23.4) (28.8) 10.2
Pension | United States of America | Bargaining Plan      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Service cost 13.9 17.0 16.9
Interest cost 31.1 28.4 33.3
Expected return on plan assets (46.7) (51.5) (47.5)
Amortization of prior service cost 1.3 0.2 0.3
Settlements (2.7)    
Net remeasurement losses (gains) 37.2 (15.1) 10.8
Net Periodic Benefit Cost (Income) (40.3) (21.0) 13.8
Pension | United States of America | Salaried Plan      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Service cost 0.3 0.4 2.5
Interest cost 6.5 5.9 7.0
Expected return on plan assets (5.0) (12.6) (13.5)
Curtailments     0.0
Net remeasurement losses (gains) 6.9 2.5 (1.0)
Net Periodic Benefit Cost (Income) 8.7 (3.8) (5.0)
Pension | United States of America | Supplemental Plan      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Interest cost 0.7 0.8 0.9
Curtailments     0.0
Net remeasurement losses (gains) (6.5) (1.5) 1.8
Net Periodic Benefit Cost (Income) (5.8) (0.7) 2.7
Pension | United Kingdom | Pension Scheme      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Service cost     0.0
Interest cost 1.3 $ 1.1 1.5
Defined Benefit Plan, Net Periodic Benefit (Cost) Credit, Expected Return (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration]   Liability, Defined Benefit Plan, Noncurrent  
Expected return on plan assets (3.2) $ (3.3) (3.3)
Net remeasurement losses (gains) 15.9 (1.1) 0.4
Net Periodic Benefit Cost (Income) 14.0 (3.3) (1.4)
Pension | Mexico | Pension Plan      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Net remeasurement losses (gains)   0.0 0.1
Net Periodic Benefit Cost (Income)   0.0 0.1
Postretirement      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Service cost 1.1 1.2 1.0
Interest cost 3.4 3.2 4.2
Expected return on plan assets (3.4) $ (3.4) (3.5)
Defined Benefit Plan, Net Periodic Benefit Cost (Credit), Amortization of Prior Service Cost (Credit), Statement of Income or Comprehensive Income [Extensible Enumeration]   Liability, Defined Benefit Plan, Noncurrent  
Amortization of prior service cost (6.0) $ (6.0) (6.0)
Net remeasurement losses (gains) (11.8) (4.9) 2.6
Net Periodic Benefit Cost (Income) $ 16.7 $ (9.9) $ (1.7)
v3.22.4
Retirement and Postretirement Plans - Schedule of Target Allocations for each Plan's Assets (Details)
Dec. 31, 2022
Pension | Equity securities  
Defined Benefit Plan, Plan Assets, Allocation [Line Items]  
Target asset allocation 24.30%
Pension | Debt Securities  
Defined Benefit Plan, Plan Assets, Allocation [Line Items]  
Target asset allocation 60.40%
Pension | Other Investments  
Defined Benefit Plan, Plan Assets, Allocation [Line Items]  
Target asset allocation 15.30%
Pension | Bargaining Plan | United States of America | Equity securities  
Defined Benefit Plan, Plan Assets, Allocation [Line Items]  
Target asset allocation 35.00%
Pension | Bargaining Plan | United States of America | Debt Securities  
Defined Benefit Plan, Plan Assets, Allocation [Line Items]  
Target asset allocation 44.00%
Pension | Bargaining Plan | United States of America | Other Investments  
Defined Benefit Plan, Plan Assets, Allocation [Line Items]  
Target asset allocation 21.00%
Pension | Salaried Plan | United States of America | Debt Securities  
Defined Benefit Plan, Plan Assets, Allocation [Line Items]  
Target asset allocation 100.00%
Pension | Salaried Plan | United States of America | Other Investments  
Defined Benefit Plan, Plan Assets, Allocation [Line Items]  
Target asset allocation 0.00%
Pension | Pension Scheme | United Kingdom | Equity securities  
Defined Benefit Plan, Plan Assets, Allocation [Line Items]  
Target asset allocation 16.70%
Pension | Pension Scheme | United Kingdom | Debt Securities  
Defined Benefit Plan, Plan Assets, Allocation [Line Items]  
Target asset allocation 66.60%
Pension | Pension Scheme | United Kingdom | Other Investments  
Defined Benefit Plan, Plan Assets, Allocation [Line Items]  
Target asset allocation 16.70%
Pension | Pension Plan | Mexico | Debt Securities  
Defined Benefit Plan, Plan Assets, Allocation [Line Items]  
Target asset allocation 100.00%
Postretirement | Equity securities  
Defined Benefit Plan, Plan Assets, Allocation [Line Items]  
Target asset allocation 20.00%
Postretirement | Debt Securities  
Defined Benefit Plan, Plan Assets, Allocation [Line Items]  
Target asset allocation 77.50%
Postretirement | Other Investments  
Defined Benefit Plan, Plan Assets, Allocation [Line Items]  
Target asset allocation 2.50%
v3.22.4
Retirement and Postretirement Plans - Allocation of Plan Assets (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Pension      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets $ 549.4 $ 1,176.0 $ 1,231.7
Pension | Level 1, 2 and 3      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 266.0 531.8  
Pension | Level 1, 2 and 3 | Cash and cash equivalents      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 58.4 87.6  
Pension | Level 1, 2 and 3 | U.S government and agency securities      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 53.7 173.9  
Pension | Level 1, 2 and 3 | Corporate bonds      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 113.0 244.7  
Pension | Level 1, 2 and 3 | Equity securities      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 14.5 25.3  
Pension | Level 1, 2 and 3 | Other      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets   0.3  
Pension | Level 1, 2 and 3 | Real estate      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 7.6    
Pension | Level 1, 2 and 3 | Private debt      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 18.8    
Pension | Level 1      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 66.9 193.2  
Pension | Level 1 | Cash and cash equivalents      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 3.0 1.2  
Pension | Level 1 | U.S government and agency securities      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 49.4 166.7  
Pension | Level 1 | Corporate bonds      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 0.0    
Pension | Level 1 | Equity securities      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 14.5 25.3  
Pension | Level 1 | Real estate      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 0.0    
Pension | Level 1 | Private debt      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 0.0    
Pension | Level 2      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 172.7 338.6  
Pension | Level 2 | Cash and cash equivalents      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 55.4 86.4  
Pension | Level 2 | U.S government and agency securities      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 4.3 7.2  
Pension | Level 2 | Corporate bonds      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 113.0 244.7  
Pension | Level 2 | Equity securities      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 0.0    
Pension | Level 2 | Other      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets   0.3  
Pension | Level 2 | Real estate      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 0.0    
Pension | Level 2 | Private debt      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 0.0    
Pension | Level 3      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 26.4 0.0  
Pension | Level 3 | Real estate      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 7.6    
Pension | Level 3 | Private debt      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 18.8    
Pension | Assets measured at net asset value      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets $ 283.4 $ 644.2  
Redemption period 90 days 90 days  
Postretirement      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets $ 59.2 $ 76.8 $ 82.2
Postretirement | Level 1, 2 and 3      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 6.1 9.6  
Postretirement | Level 1, 2 and 3 | Cash and cash equivalents      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 1.4 3.8  
Postretirement | Level 1, 2 and 3 | Mutual fund - fixed income      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 4.7 5.8  
Postretirement | Level 1      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets   9.6  
Postretirement | Level 1 | Cash and cash equivalents      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets   3.8  
Postretirement | Level 1 | Mutual fund - fixed income      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets   5.8  
Postretirement | Level 2      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 6.1    
Postretirement | Level 2 | Cash and cash equivalents      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 1.4    
Postretirement | Level 2 | Mutual fund - fixed income      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets 4.7    
Postretirement | Assets measured at net asset value      
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items]      
Total Assets $ 53.1 $ 67.2  
Redemption period 90 days 90 days  
v3.22.4
Retirement and Postretirement Plans - Summary of Changes in the Fair Value of Pension Plan Level Three Assets (Details) - Pension
$ in Millions
 12 Months Ended
Dec. 31, 2022
USD ($)
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]  
Fair value of plan assets at the beginning of year $ 1,176.0
Fair value of plan assets at end of year 549.4
Level 3  
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]  
Fair value of plan assets at the beginning of year 0.0
Transfers in and/or out of Level 3 0.0
Realized gain (loss) 0.4
Net unrealized gain (loss) 0.1
Purchases 31.4
Sales 5.5
Fair value of plan assets at end of year $ 26.4
v3.22.4
Retirement and Postretirement Plans - Benefit Payments (Details)
$ in Millions
Dec. 31, 2022
USD ($)
Pension  
Benefit Payments:  
2023 $ 52.3
2024 53.0
2025 54.2
2026 56.2
2027 73.3
2028-2032 278.9
Pension | Bargaining Plan | United States of America  
Benefit Payments:  
2023 36.3
2024 36.9
2025 39.1
2026 41.8
2027 46.3
2028-2032 214.1
Pension | Salaried Plan | United States of America  
Benefit Payments:  
2023 13.3
2024 13.3
2025 12.3
2026 11.7
2027 11.3
2028-2032 49.8
Pension | Supplemental Plan | United States of America  
Benefit Payments:  
2023 0.6
2024 0.6
2025 0.5
2026 0.5
2027 13.4
2028-2032 2.1
Pension | Pension Scheme | United Kingdom  
Benefit Payments:  
2023 2.1
2024 2.2
2025 2.3
2026 2.2
2027 2.3
2028-2032 12.3
Pension | Pension Plan | Mexico  
Benefit Payments:  
2028-2032 0.6
Postretirement  
Benefit Payments:  
2023 10.1
2024 9.1
2025 8.5
2026 8.0
2027 7.7
2028-2032 $ 34.3
v3.22.4
Stock-Based Compensation - Narrative (Details)
 12 Months Ended
May 05, 2021
shares
May 06, 2020
USD ($)
shares
Dec. 31, 2022
USD ($)
shares
Dec. 31, 2021
USD ($)
Dec. 31, 2020
USD ($)
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]          
Stock-based compensation expense | $     $ 8,800,000 $ 7,300,000 $ 6,600,000
Future stock-based compensation expense | $     $ 11,400,000    
Future stock-based compensation expense, period of recognition     1 year 8 months 12 days    
Time-Based Restricted Stock Units          
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]          
Vesting rights description     These restricted stock units do not have any performance conditions for vesting.    
Performance-Based Restricted Stock Units          
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]          
Vesting rights description     The overall vesting period is generally three years, with relative total shareholder return measured for the one, two and three-year periods creating effectively a “nested” 1-year, 2-year, and 3-year plan to support rapid and sustained shareholder value creation.    
Vesting period     3 years    
Number of trading days to calculate average closing stock price     20 days    
TimkenSteel 2020 Plan          
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]          
Aggregate share limit ratio   1      
Stock-based compensation, extended-term plan May 05, 2031        
Shares available for grant (in shares)   2,000,000.0 4,100,000    
Shares available for grant (in shares) 2,000,000        
TimkenSteel 2020 Plan | Maximum          
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]          
Number of shares authorized (in shares) 2,000,000 2,000,000.0      
Share-based compensation, full value award limit 1,800,000        
TimkenSteel 2020 Plan | Non-employee Director | Maximum          
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]          
Share-based compensation, maximum grant value | $   $ 500,000      
v3.22.4
Stock-Based Compensation - Stock Option Activity (Details) - USD ($)
$ / shares in Units, $ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Number of Shares    
Beginning balance (in shares) 2,054,088  
Granted (in shares) 0 0
Vested (in shares) (518,770)  
Canceled, forfeited or expired (in shares) (415,795)  
Ending balance (in shares) 1,119,523 2,054,088
Options expected to vest, number of shares (in shares) 167,610  
Options exercisable, number of shares (in shares) 951,913  
Weighted Average Exercise Price    
Beginning balance (in USD per share) $ 20.41  
Granted (in USD per share) 0  
Exercised (in USD per share) 15.36  
Canceled, forfeited or expired (in USD per share) 30.86  
Ending balance (in USD per share) 18.85 $ 20.41
Options expected to vest, weighted average exercise price (in USD per share) 6.44  
Options exercisable, weighted average exercise price (in USD per share) $ 21.04  
Additional Information    
Outstanding, weighted average remaining contractual term 3 years 10 months 24 days  
Options expected to vest, weighted average remaining contractual term 7 years  
Options exercisable, weighted average remaining contractual term 3 years 3 months 18 days  
Outstanding, aggregate intrinsic value $ 5.8  
Options expected to vest, aggregate intrinsic value 2.0  
Options exercisable, aggregate intrinsic value $ 3.8  
v3.22.4
Stock-Based Compensation - Schedule of Time-Based Restricted Stock Unit Activity (Details) - Time-Based Restricted Stock Units
 12 Months Ended
Dec. 31, 2022
$ / shares
shares
Number of Shares  
Beginning balance (in shares) | shares 1,668,050
Granted (in shares) | shares 355,813
Vested (in shares) | shares (420,083)
Canceled, forfeited or expired (in shares) | shares (57,778)
Ending balance (in shares) | shares 1,546,002
Weighted Average Grant Date Fair Value  
Beginning balance (in USD per share) | $ / shares $ 7.92
Granted (in USD per share) | $ / shares 18.07
Vested (in USD per share) | $ / shares 11.41
Canceled, forfeited or expired (in USD per share) | $ / shares 8.35
Ending balance (in USD per share) | $ / shares $ 9.29
v3.22.4
Stock-Based Compensation - Schedule of Performance-Based Restricted Stock Unit Activity (Details) - Performance-Based Restricted Stock Units
 12 Months Ended
Dec. 31, 2022
$ / shares
shares
Number of Shares  
Beginning balance (in shares) | shares 794,044
Granted (in shares) | shares 178,467
Canceled, forfeited or expired (in shares) | shares (4,096)
Ending balance (in shares) | shares 968,415
Weighted Average Grant Date Fair Value  
Beginning balance (in USD per share) | $ / shares $ 6.91
Granted (in USD per share) | $ / shares 25.04
Canceled, forfeited or expired (in USD per share) | $ / shares 15.64
Ending balance (in USD per share) | $ / shares $ 10.21
v3.22.4
Accumulated Other Comprehensive Income (Loss) - Schedule of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
AOCI Attributable to Parent, Net of Tax [Roll Forward]      
Beginning balance $ 664.6 $ 507.5 $ 563.1
Other comprehensive income before reclassifications, before income tax 1.7 0.3  
Amounts reclassified from accumulated other comprehensive income (loss), before income tax (4.7) (5.8)  
Amounts deferred to accumulated other comprehensive income (loss), before income tax 0.0 (14.2)  
Tax effect 0.4 0.0 0.1
Other comprehensive income (loss), net of tax (6.0) (19.7) (4.3)
Ending balance 686.5 664.6 507.5
Foreign Currency Translation Adjustments      
AOCI Attributable to Parent, Net of Tax [Roll Forward]      
Beginning balance (5.1) (5.4)  
Other comprehensive income before reclassifications, before income tax (1.7) 0.3  
Amounts reclassified from accumulated other comprehensive income (loss), before income tax 0.0 0.0  
Amounts deferred to accumulated other comprehensive income (loss), before income tax 0.0 0.0  
Tax effect 0.0 0.0  
Other comprehensive income (loss), net of tax (1.7) 0.3  
Ending balance (6.8) (5.1) (5.4)
Pension and Postretirement Liability Adjustments      
AOCI Attributable to Parent, Net of Tax [Roll Forward]      
Beginning balance 25.8 45.8  
Other comprehensive income before reclassifications, before income tax 0.0 0.0  
Amounts reclassified from accumulated other comprehensive income (loss), before income tax (4.7) (5.8)  
Amounts deferred to accumulated other comprehensive income (loss), before income tax 0.0 (14.2)  
Tax effect 0.4 0.0  
Other comprehensive income (loss), net of tax (4.3) (20.0)  
Ending balance 21.5 25.8 45.8
Accumulated Other Comprehensive Income (Loss)      
AOCI Attributable to Parent, Net of Tax [Roll Forward]      
Beginning balance 20.7 40.4 44.7
Other comprehensive income (loss), net of tax (6.0) (19.7) (4.3)
Ending balance $ 14.7 $ 20.7 $ 40.4
v3.22.4
Contingencies - Narrative (Details) - USD ($)
$ in Millions
Dec. 31, 2022
Dec. 31, 2021
Loss Contingency Accrual, Disclosures [Abstract]    
Contingency reserves $ 1.1 $ 0.3
v3.22.4
Schedule II - Valuation and Qualifying Accounts (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Allowance for Uncollectible Accounts      
Valuation And Qualifying Accounts Disclosure [Line Items]      
Balance at Beginning of Period $ 1.9 $ 1.3 $ 1.5
Charged to Costs and Expenses   0.6  
Deductions (0.9)   (0.2)
Balance at End of Period 1.0 1.9 1.3
Allowance for Inventory Reserves      
Valuation And Qualifying Accounts Disclosure [Line Items]      
Balance at Beginning of Period 0.8 13.9 10.7
Charged to Costs and Expenses 0.5 2.8 4.1
Deductions (0.8) (15.9) (0.9)
Balance at End of Period 0.5 0.8 13.9
Valuation Allowance on Deferred Tax Assets      
Valuation And Qualifying Accounts Disclosure [Line Items]      
Balance at Beginning of Period 15.5 47.7 34.9
Charged to Costs and Expenses     12.4
Charged to Other Accounts   4.8 1.4
Deductions (2.5) (37.0) (1.0)
Balance at End of Period $ 13.0 $ 15.5 $ 47.7