TimkenSteel-2014-Annual-Report-FINAL-03112015_v001_d4t4ig

Unallocated Years Ended December 31,
2013 2012 $ Change % Change
LIFO $1.5 ($15.6) $17.1 (109.6)%
Corporate expenses $13.2 $11.9 $1.3 10.9%
Unallocated $14.7 ($3.7) $18.4 (497.3)%
Unallocated % to net sales 1.1% (0.2)% NM 130 bps
Unallocated are costs associated with strategy, corporate development, tax, treasury, legal, internal
audit, LIFO and general administration expenses. Unallocated increased $18.4 million for the
year ended December 31, 2013 compared to the same period in 2012 primarily due to increased
LIFO expense.
NON-GAAP FINANCIAL MEASURES
Net Sales, Excluding Surcharges
This Management’s Discussion and Analysis of Financial Condition and Results of Operations includes
discussions of net sales adjusted to exclude raw material surcharges, which represents a financial measure
that has not been determined in accordance with accounting principles generally accepted in the United
States (U.S. GAAP). Generally, as we experience fluctuations in our costs, we reflect them as price
increases or surcharges to our customers with the goal of being essentially cost neutral. However, even if
we are able to pass these raw material surcharges or price increases on to our customers, there may be
a time lag between the time a cost increase goes into effect and our ability to implement surcharges or
price increases. We believe presenting net sales to exclude surcharges provides a more consistent basis
for comparing our core operating results.
TimkenSteel Years Ended December 31,
2014 2013 2012
Net sales $ 1,674.2 $ 1,380.9 $ 1,728.7
Less: surcharge revenue 390.0 300.2 417.0
Net sales, excluding surcharges $ 1,284.2 $ 1,080.7 $ 1,311.7
Industrial & Mobile Years Ended December 31,
2014 2013 2012
Net sales $ 962.0 $ 865.0 $ 1,014.1
Less: surcharge revenue 217.6 181.5 239.9
Net sales, excluding surcharges $ 744.4 $ 683.5 $ 774.2
Energy & Distribution Years Ended December 31,
2014 2013 2012
Net sales $ 712.2 $ 515.9 $ 714.6
Less: surcharge revenue 172.4 118.7 177.1
Net sales, excluding surcharges $ 539.8 $ 397.2 $ 537.5
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TIMKENSTEEL ANNUAL REPORT
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