老虎机种类

Sales

Cost of goods sold (exclusive of expenses below)^(2),(3)

Selling, general administrative, and other expenses⁽²⁾

Research and development expenses⁽²⁾

Provision for depreciation and amortization

Restructuring and other charges⁽⁴⁾

Operating (loss) income⁽³⁾

Interest expense

Other expenses (income), net^(2),(5)

(Loss) Income before income taxes⁽³⁾

(Benefit) Provision for income taxes⁽³⁾

Net (loss) income⁽³⁾

Less: Net income attributable to noncontrolling interest

NET (LOSS) INCOME ATTRIBUTABLE TO ARCONIC CORPORATION⁽³⁾

EARNINGS PER SHARE ATTRIBUTABLE TO ARCONIC CORPORATION COMMON SHAREHOLDERS:

Basic:

Net (loss) income⁽³⁾

Weighted-average number of shares⁽⁶⁾

Diluted:

Net (loss) income⁽³⁾

Weighted-average number of shares⁽⁶⁾

COMMON STOCK OUTSTANDING AT THE END OF THE PERIOD

Prior to April 1, 2020, 老虎机种类 Corporation鈥檚 financial statements were prepared on a carve-out basis, as the underlying operations of the Company were previously consolidated as part of 老虎机种类 Corporation鈥檚 former parent company鈥檚 financial statements. Accordingly, the Company鈥檚 results of operations for the quarter ended December 31, 2019 were prepared on such basis. The carve-out financial statements of 老虎机种类 Corporation are not necessarily indicative of the Company鈥檚 consolidated results of operations had it been a standalone company during the referenced period. See the Combined Financial Statements included in each of (i) Exhibit 99.1 to 老虎机种类 Corporation鈥檚 Form 10 Registration Statement (filed on February 7, 2020), (ii) the Company鈥檚 Annual Report on Form 10-K for the year ended December 31, 2019 (filed on March 30, 2020), and (iii) the Company鈥檚 Quarterly Report on Form 10-Q for the period ended March 31, 2020 (filed on May 18, 2020), for additional information.

In preparation for the separation of 老虎机种类 Corporation from its former parent company, effective January 1, 2020, certain U.S. defined benefit pension and other postretirement plans previously sponsored by the former parent company were separated into standalone plans for both 老虎机种类 Corporation and the former parent company. Additionally, effective April 1, 2020, 老虎机种类 Corporation assumed a portion of the obligations associated with certain non-U.S. defined benefit pension plans that included participants related to both 老虎机种类 Corporation and its former parent company, as well as legacy defined benefit pension plans assigned to the Company as a result of the separation from the former parent company. As a result, beginning in the first quarter of 2020 for these U.S. plans and in the second quarter of 2020 for these non-U.S. plans, 老虎机种类 Corporation applied defined benefit plan accounting resulting in benefit plan expense being recorded in operating income (service cost) and nonoperating income (nonservice cost). In all historical periods prior to these respective timeframes, 老虎机种类 Corporation was considered a participating employer in the former parent company鈥檚 defined benefit plans and, therefore, applied multiemployer plan accounting resulting in the Company鈥檚 share of benefit plan expense being recorded entirely in operating income. Also, 老虎机种类 Corporation is the plan sponsor of certain other non-U.S. defined benefit plans that contain participants related only to the underlying operations of the Company and, therefore, the related benefit plan expense was recorded in accordance with defined benefit plan accounting in all periods presented. The following table presents the total benefit plan expense (excluding settlements and curtailments) recorded by 老虎机种类 Corporation based on the foregoing in each period presented:

Cost of goods sold (exclusive of expenses below)

Selling, general administrative, and other expenses

Research and development expenses

Other expenses, net

Effective July 1, 2020, the Company changed its inventory cost method to average cost for all U.S. inventories previously carried at last-in, first-in (LIFO) cost. Management believes the average cost method more closely reflects the physical flow of inventories, improves comparability of the Company鈥檚 operating results with its industry peers, and provides an increased level of consistency in the measurement of inventories in the Company鈥檚 consolidated financial statements. The effects of the change in accounting principle from LIFO to average cost have been retrospectively applied to the Company鈥檚 Statement of Consolidated Operations for the quarter ended December 31, 2019. Accordingly, Net income attributable to 老虎机种类 Corporation decreased $18 (comprised of a $23 increase to Cost of goods sold and a $5 increase to Benefit for income taxes), or $0.17 per share, from the amount previously reported in the Company鈥檚 Annual Report on Form 10-K for the year ended December 31, 2019 (filed on March 30, 2020). See the Consolidated Financial Statements included in the Company鈥檚 Annual Report on Form 10-K for the year ended December 31, 2020 for additional information.

In the quarter ended December 31, 2020, Restructuring and other charges includes a $140 settlement charge related to the annuitization of a portion of the Company鈥檚 U.S. defined benefit pension plan obligation and a $25 benefit for contingent consideration received related to the October 2018 sale of the Texarkana (Texas) rolling mill. In the quarter ended December 31, 2019, Restructuring and other charges includes a $20 benefit for contingent consideration received related to the October 2018 sale of the Texarkana (Texas) rolling mill.

In the quarter ended December 31, 2020, Other expenses (income), net includes a $20 benefit for the reversal of a liability previously established on April 1, 2020 related to a potential indemnification to Howmet Aerospace by 老虎机种类 Corporation for an outstanding income tax matter in Spain. In November 2020, Howmet Aerospace received a favorable ruling from Spain鈥檚 Supreme Court bringing a final conclusion to this matter as this decision may not be appealed any further. As no further income tax payment was required of Howmet Aerospace likewise 老虎机种类 Corporation no longer has a requirement to perform under the indemnification.

In the quarter ended December 31, 2020, the diluted weighted-average number of shares does not include any common share equivalents associated with outstanding employee stock awards as their effect was anti-dilutive since the Company generated a net loss for the period. In the quarter ended September 30, 2020, the difference between the diluted weighted-average number of shares and the basic weighted-average number of shares relates to common share equivalents associated with outstanding employee stock awards. Prior to April 1, 2020, the Company did not have any publicly-traded issued and outstanding common stock or any common share equivalents. Accordingly, the respective basic and diluted earnings per share for the quarter ended December 31, 2019 were calculated based on the 109,021,376 shares of 老虎机种类 Corporation common stock distributed on April 1, 2020 in connection with the completion of 老虎机种类 Corporation鈥檚 separation from its former parent company.

Sales

Cost of goods sold (exclusive of expenses below)^(2),(3)

Selling, general administrative, and other expenses⁽²⁾

Research and development expenses⁽²⁾

Provision for depreciation and amortization

Restructuring and other charges⁽⁴⁾

Operating income⁽³⁾

Interest expense

Other expenses (income), net^(2),(5)

(Loss) Income before income taxes⁽³⁾

Provision (Benefit) for income taxes⁽³⁾

Net (loss) income⁽³⁾

Less: Net income attributable to noncontrolling interest

NET (LOSS) INCOME ATTRIBUTABLE TO ARCONIC CORPORATION⁽³⁾

EARNINGS PER SHARE ATTRIBUTABLE TO ARCONIC CORPORATION COMMON SHAREHOLDERS:

Basic:

Net (loss) income⁽³⁾

Weighted-average number of shares⁽⁶⁾

Diluted:

Net (loss) income⁽³⁾

Weighted-average number of shares⁽⁶⁾

COMMON STOCK OUTSTANDING AT THE END OF THE PERIOD

Prior to April 1, 2020, 老虎机种类 Corporation鈥檚 financial statements were prepared on a carve-out basis, as the underlying operations of the Company were previously consolidated as part of 老虎机种类 Corporation鈥檚 former parent company鈥檚 financial statements. Accordingly, the Company鈥檚 results of operations for the first three months included in the year ended December 31, 2020 and all months included in the year ended December 31, 2019 were prepared on such basis. The carve-out financial statements of 老虎机种类 Corporation are not necessarily indicative of the Company鈥檚 consolidated results of operations had it been a standalone company during the referenced periods. See the Combined Financial Statements included in each of (i) Exhibit 99.1 to 老虎机种类 Corporation鈥檚 Form 10 Registration Statement (filed on February 7, 2020), (ii) the Company鈥檚 Annual Report on Form 10-K for the year ended December 31, 2019 (filed on March 30, 2020), and (iii) the Company鈥檚 Quarterly Report on Form 10-Q for the period ended March 31, 2020 (filed on May 18, 2020), for additional information.

In preparation for the separation of 老虎机种类 Corporation from its former parent company, effective January 1, 2020, certain U.S. defined benefit pension and other postretirement plans previously sponsored by the former parent company were separated into standalone plans for both 老虎机种类 Corporation and the former parent company. Additionally, effective April 1, 2020, 老虎机种类 Corporation assumed a portion of the obligations associated with certain non-U.S. defined benefit pension plans that included participants related to both 老虎机种类 Corporation and its former parent company, as well as legacy defined benefit pension plans assigned to the Company as a result of the separation from the former parent company. As a result, beginning in the first quarter of 2020 for these U.S. plans and in the second quarter of 2020 for these non-U.S. plans, 老虎机种类 Corporation applied defined benefit plan accounting resulting in benefit plan expense being recorded in operating income (service cost) and nonoperating income (nonservice cost). In all historical periods prior to these respective timeframes, 老虎机种类 Corporation was considered a participating employer in the former parent company鈥檚 defined benefit plans and, therefore, applied multiemployer plan accounting resulting in the Company鈥檚 share of benefit plan expense being recorded entirely in operating income. Also, 老虎机种类 Corporation is the plan sponsor of certain other non-U.S. defined benefit plans that contain participants related only to the underlying operations of the Company and, therefore, the related benefit plan expense was recorded in accordance with defined benefit plan accounting in all periods presented. The following table presents the total benefit plan expense (excluding settlements and curtailments) recorded by 老虎机种类 Corporation based on the foregoing in each period presented:

Cost of goods sold (exclusive of expenses below)

Selling, general administrative, and other expenses

Research and development expenses

Other expenses (income), net

Effective July 1, 2020, the Company changed its inventory cost method to average cost for all U.S. inventories previously carried at last-in, first-in (LIFO) cost. Management believes the average cost method more closely reflects the physical flow of inventories, improves comparability of the Company鈥檚 operating results with its industry peers, and provides an increased level of consistency in the measurement of inventories in the Company鈥檚 consolidated financial statements. The effects of the change in accounting principle from LIFO to average cost have been retrospectively applied to the Company鈥檚 Statement of Consolidated Operations for the year ended December 31, 2019. Accordingly, Net income attributable to 老虎机种类 Corporation decreased $48 (comprised of a $62 increase to Cost of goods sold and a $14 increase to Benefit for income taxes), or $0.44 per share, from the amount previously reported in the Company鈥檚 Annual Report on Form 10-K for the year ended December 31, 2019 (filed on March 30, 2020). See the Consolidated Financial Statements included in the Company鈥檚 Annual Report on Form 10-K for the year ended December 31, 2020 for additional information.

In the year ended December 31, 2020, Restructuring and other charges includes a $198 settlement charge related to the annuitizations of a portion of the Company鈥檚 U.S. and U.K. defined benefit pension plan obligations and a $25 benefit for contingent consideration received related to the October 2018 sale of the Texarkana (Texas) rolling mill. In the year ended December 31, 2019, Restructuring and other charges includes a $20 benefit for contingent consideration received related to the October 2018 sale of the Texarkana (Texas) rolling mill.

In the year ended December 31, 2020, Other expenses (income), net includes a $20 benefit for the reversal of a liability previously established on April 1, 2020 related to a potential indemnification to Howmet Aerospace by 老虎机种类 Corporation for an outstanding income tax matter in Spain. In November 2020, Howmet Aerospace received a favorable ruling from Spain鈥檚 Supreme Court bringing a final conclusion to this matter as this decision may not be appealed any further. As no further income tax payment was required of Howmet Aerospace likewise 老虎机种类 Corporation no longer has a requirement to perform under the indemnification.

In the year ended December 31, 2020, the diluted weighted-average number of shares does not include any common share equivalents associated with outstanding employee stock awards as their effect was anti-dilutive since the Company generated a net loss for the period. Prior to April 1, 2020, the Company did not have any publicly-traded issued and outstanding common stock or any common share equivalents. Accordingly, the respective basic and diluted earnings per share for the year ended December 31, 2019 were calculated based on the 109,021,376 shares of 老虎机种类 Corporation common stock distributed on April 1, 2020 in connection with the completion of 老虎机种类 Corporation鈥檚 separation from its former parent company.

ASSETS

Current assets:

Cash and cash equivalents

Receivables from customers, less allowances of $1 in 2020 and $2 in 2019⁽²⁾

Other receivables

Inventories⁽³⁾

Prepaid expenses and other current assets

Total current assets

Properties, plants, and equipment

Less: accumulated depreciation and amortization

Properties, plants, and equipment, net

Operating lease right-of-use-assets

Deferred income taxes

Other noncurrent assets

Total assets

LIABILITIES

Current liabilities:

Accounts payable, trade

Accrued compensation and retirement costs

Taxes, including income taxes

Environmental remediation

Operating lease liabilities

Other current liabilities

Total current liabilities

Long-term debt

Accrued pension benefits

Accrued other postretirement benefits

Environmental remediation

Operating lease liabilities

Deferred income taxes⁽³⁾

Other noncurrent liabilities and deferred credits

Total liabilities

EQUITY

老虎机种类 Corporation shareholders鈥� equity:

Parent Company net investment⁽³⁾

Common stock

Additional capital

Accumulated deficit

Accumulated other comprehensive (loss) income

Total 老虎机种类 Corporation shareholders' equity

Noncontrolling interest

Total equity

Total liabilities and equity

Prior to April 1, 2020, 老虎机种类 Corporation鈥檚 financial statements were prepared on a carve-out basis, as the underlying operations of the Company were previously consolidated as part of 老虎机种类 Corporation鈥檚 former parent company鈥檚 financial statements. Accordingly, the Company鈥檚 financial position as of December 31, 2019 was prepared on such basis. The carve-out financial statements of 老虎机种类 Corporation are not necessarily indicative of the Company鈥檚 financial position had it been a standalone company during the referenced period. See the Combined Financial Statements included in each of (i) Exhibit 99.1 to 老虎机种类 Corporation鈥檚 Form 10 Registration Statement (filed on February 7, 2020), (ii) the Company鈥檚 Annual Report on Form 10-K for the year ended December 31, 2019 (filed on March 30, 2020), and (iii) the Company鈥檚 Quarterly Report on Form 10-Q for the period ended March 31, 2020 (filed on May 18, 2020), for additional information.

Prior to January 1, 2020, certain of 老虎机种类 Corporation鈥檚 customer receivables were sold to its former parent company, which had an arrangement with several financial institutions to sell certain customer receivables without recourse on a revolving basis. As of December 31, 2019, the amount of 老虎机种类 Corporation鈥檚 outstanding customer receivables sold to its former parent company was $281. In preparation for the separation of 老虎机种类 Corporation from its former parent company, effective January 2, 2020, the former parent company鈥檚 arrangement was amended to no longer include customer receivables associated with 老虎机种类 Corporation in this program.

Effective July 1, 2020, the Company changed its inventory cost method to average cost for all U.S. inventories previously carried at last-in, first-in (LIFO) cost. Management believes the average cost method more closely reflects the physical flow of inventories, improves comparability of the Company鈥檚 operating results with its industry peers, and provides an increased level of consistency in the measurement of inventories in the Company鈥檚 consolidated financial statements. The effects of the change in accounting principle from LIFO to average cost have been retrospectively applied to the Company鈥檚 Consolidated Balance Sheet as of December 31, 2019. Accordingly, Inventories, Deferred income taxes, and Parent Company net investment increased $317, $72, and $245, respectively, from amounts previously reported in the Company鈥檚 Annual Report on Form 10-K for the year ended December 31, 2019 (filed March 30, 2020). The increase to Parent Company net investment includes a cumulative effect of accounting change of $293 recorded on January 1, 2019. See the Consolidated Financial Statements included in the Company鈥檚 Annual Report on Form 10-K for the year ended December 31, 2020 for additional information.

OPERATING ACTIVITIES

Net (loss) income⁽¹⁾

Adjustments to reconcile net (loss) income to cash (used for) provided from operations:

Depreciation and amortization

Deferred income taxes⁽¹⁾

Restructuring and other charges

Net periodic pension benefit cost

Stock-based compensation

Amortization of debt issuance costs

Other

Changes in assets and liabilities, excluding effects of acquisitions, divestitures, and foreign currency translation adjustments:

Decrease (Increase) in receivables

(Increase) Decrease in inventories⁽¹⁾

Decrease (Increase) in prepaid expenses and other current assets

Increase (Decrease) in accounts payable, trade⁽²⁾

(Decrease) in accrued expenses

Increase (Decrease) in taxes, including income taxes

Pension contributions

Decrease in noncurrent assets

Increase in noncurrent liabilities

CASH (USED FOR) PROVIDED FROM OPERATIONS

FINANCING ACTIVITIES

Separation payment to former parent company⁽³⁾

Additions to debt (original maturities greater than three months)⁽³⁾

Debt issuance costs

Payments on debt (original maturities greater than three months)⁽³⁾

Other

CASH PROVIDED FROM (USED FOR) FINANCING ACTIVITIES

INVESTING ACTIVITIES

Capital expenditures⁽²⁾

Proceeds from the sale of assets and businesses

CASH USED FOR INVESTING ACTIVITIES

EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS AND RESTRICTED CASH

Net change in cash and cash equivalents and restricted cash

Cash and cash equivalents and restricted cash at beginning of period⁽⁴⁾

CASH AND CASH EQUIVALENTS AND RESTRICTED CASH AT END OF PERIOD⁽⁴⁾

Effective July 1, 2020, the Company changed its inventory cost method to average cost for all U.S. inventories previously carried at last-in, first-in (LIFO) cost. Management believes the average cost method more closely reflects the physical flow of inventories, improves comparability of the Company鈥檚 operating results with its industry peers, and provides an increased level of consistency in the measurement of inventories in the Company鈥檚 consolidated financial results. The effects of the change in accounting principle from LIFO to average cost have been retrospectively applied to the Company鈥檚 Statement of Consolidated Cash Flows for the quarter ended June 30, 2020. Accordingly, Net loss increased $4, Deferred income taxes decreased $1, and Decrease in inventories positively changed by $5. See the Consolidated Financial Statements included in the Company鈥檚 Annual Report on Form 10-K for the year ended December 31, 2020 for additional information.

In preparing the Statement of Consolidated Cash Flows for the nine months ended September 30, 2020, management discovered that the amount of (Decrease) in account payable, trade previously reported for the quarter ended June 30, 2020 was overstated by $8 and the amount of Capital expenditures previously reported for the quarter ended June 30, 2020 was understated by $8. As a result, for the quarter ended June 30, 2020, management has corrected both (Decrease) in accounts payable, trade and Capital expenditures from previously reported amounts to remove the respective effect of this $8. Additionally, financial information for prior periods not presented herein will be corrected, as applicable, in future filings.

On April 1, 2020, 老虎机种类 Inc. separated into two standalone, publicly-traded companies, 老虎机种类 Corporation and Howmet Aerospace Inc. (the 鈥淪eparation鈥�). In connection with the capital structure to be established at the time of the Separation, 老虎机种类 Corporation secured $1,200 in third-party indebtedness during the first quarter of 2020. The net proceeds from a portion of this indebtedness was held in escrow until the satisfaction of the escrow release conditions, which included the substantially concurrent completion of the Separation. Accordingly, the escrowed cash was included in Restricted cash as of March 31, 2020 (see footnote 4). The Company used a portion of the net proceeds from the aggregate indebtedness to make a $728 payment to its former parent company on April 1, 2020 to fund the transfer of certain net assets from the former parent company to 老虎机种类 Corporation in connection with the completion of the Separation. On April 2, 2020, 老虎机种类 Corporation incurred an additional $500 of indebtedness as a proactive measure taken by the Company to bolster its liquidity and preserve financial flexibility in light of uncertainties resulting from the COVID-19 outbreak. On May 13, 2020, in order to provide improved financial flexibility, 老虎机种类 Corporation executed a refinancing of a portion of its outstanding indebtedness by securing $700 in new third-party indebtedness. The Company used the net proceeds from the new indebtedness, together with cash on hand, to repay $1,100 of outstanding indebtedness.

Cash and cash equivalents and restricted cash at beginning of period for the quarters ended December 31, 2020 and September 30, 2020 and Cash and cash equivalents and restricted cash at end of period for all periods includes Restricted cash of less than $0.03. For the quarter ended June 30, 2020, Cash and cash equivalents and restricted cash at beginning of period includes Restricted cash of $593 (see footnote 3).

Total Segment Adjusted EBITDA^(2),(3),(4)

Unallocated amounts:

Corporate expenses^(3),(5)

Stock-based compensation expense

Metal price lag⁽⁶⁾

Provision for depreciation and amortization

Restructuring and other charges

Operating (loss) income⁽⁴⁾

Interest expense

Other (expenses) income, net⁽³⁾

Benefit for income taxes⁽⁴⁾

Prior to April 1, 2020, 老虎机种类 Corporation鈥檚 financial statements were prepared on a carve-out basis, as the underlying operations of the Company were previously consolidated as part of 老虎机种类 Corporation鈥檚 former parent company鈥檚 financial statements. Accordingly, the Company鈥檚 results of operations for the quarter ended December 31, 2019 were prepared on such basis. The carve-out financial statements of 老虎机种类 Corporation are not necessarily indicative of the Company鈥檚 consolidated results of operations had it been a standalone company during the referenced period. See the Combined Financial Statements included in each of (i) Exhibit 99.1 to 老虎机种类 Corporation鈥檚 Form 10 Registration Statement (filed on February 7, 2020), (ii) the Company鈥檚 Annual Report on Form 10-K for the year ended December 31, 2019 (filed on March 30, 2020), and (iii) the Company鈥檚 Quarterly Report on Form 10-Q for the period ended March 31, 2020 (filed on May 18, 2020), for additional information.

Effective in the second quarter of 2020, management elected to change the profit or loss measure of the Company鈥檚 reportable segments from Segment operating profit to Segment Adjusted EBITDA (Earnings before interest, taxes, depreciation, and amortization) for internal reporting and performance measurement purposes. This change was made to enhance the transparency and visibility of the underlying operating performance of each segment. Effective in the third quarter of 2020, management refined the Company鈥檚 Segment Adjusted EBITDA measure to remove the impact of metal price lag (see footnote 6). This change was made to further enhance the transparency and visibility of the underlying operating performance of each segment by removing the volatility associated with metal prices.

老虎机种类 Corporation calculates Segment Adjusted EBITDA as Total sales (third-party and intersegment) minus each of (i) Cost of goods sold, (ii) Selling, general administrative, and other expenses, and (iii) and Research and development expenses, plus Stock-based compensation expense and Metal price lag. Previously, the Company calculated Segment operating profit as Segment Adjusted EBITDA minus each of (i) the Provision for depreciation and amortization, (ii) Stock-based compensation expense, and (iii) Metal price lag. 老虎机种类 Corporation鈥檚 Segment Adjusted EBITDA may not be comparable to similarly titled measures of other companies鈥� reportable segments.

Also, effective July 1, 2020, the Company changed its inventory cost method to average cost for all U.S. inventories previously carried at last-in, first-in (LIFO) cost. The effects of the change in accounting principle have been retrospectively applied to the Company鈥檚 Statement of Consolidated Operations for the quarter ended December 31, 2019. See footnote 4 for additional information.

Segment Adjusted EBITDA for the quarter ended December 31, 2019 was recast to reflect the new measure of segment profit or loss and the change in inventory cost method.

Total Segment Adjusted EBITDA is the sum of the respective Segment Adjusted EBITDA for each of the Company's three reportable segments: Rolled Products, Building and Construction Systems, and Extrusions. This amount is being presented for the sole purpose of reconciling Segment Adjusted EBITDA to the Company's Consolidated net (loss) income.

In preparation for the separation of 老虎机种类 Corporation from its former parent company, effective January 1, 2020, certain U.S. defined benefit pension and other postretirement plans previously sponsored by the former parent company were separated into standalone plans for both 老虎机种类 Corporation and the former parent company. Additionally, effective April 1, 2020, 老虎机种类 Corporation assumed a portion of the obligations associated with certain non-U.S. defined benefit pension plans that included participants related to both 老虎机种类 Corporation and its former parent company, as well as legacy defined benefit pension plans assigned to the Company as a result of the separation from the former parent company. As a result, beginning in the first quarter of 2020 for these U.S. plans and in the second quarter of 2020 for these non-U.S. plans, 老虎机种类 Corporation applied defined benefit plan accounting resulting in benefit plan expense being recorded in operating income (service cost) and nonoperating income (nonservice cost). In all historical periods prior to these respective timeframes, 老虎机种类 Corporation was considered a participating employer in the former parent company鈥檚 defined benefit plans and, therefore, applied multiemployer plan accounting resulting in the Company鈥檚 share of benefit plan expense being recorded entirely in operating income. Also, 老虎机种类 Corporation is the plan sponsor of certain other non-U.S. defined benefit plans that contain participants related only to the underlying operations of the Company and, therefore, the related benefit plan expense was recorded in accordance with defined benefit plan accounting in all periods presented. The following table presents the total benefit plan expense (excluding settlements and curtailments) recorded by 老虎机种类 Corporation based on the foregoing in each period presented:

Total Segment Adjusted EBITDA

Unallocated amounts:

Corporate expenses

Effective July 1, 2020, the Company changed its inventory cost method to average cost for all U.S. inventories previously carried at LIFO cost. Management believes the average cost method more closely reflects the physical flow of inventories, improves comparability of the Company鈥檚 operating results with its industry peers, and provides an increased level of consistency in the measurement of inventories in the Company鈥檚 consolidated financial statements. The effects of the change in accounting principle from LIFO to average cost have been retrospectively applied to the Company鈥檚 Statement of Consolidated Operations for the quarter ended December 31, 2019. Accordingly, Net income attributable to 老虎机种类 Corporation decreased $18 (comprised of a $23 increase to Cost of goods sold and a $5 increase to Benefit for income taxes) from the amount previously reported in the Company鈥檚 Annual Report on Form 10-K for the year ended December 31, 2019 (filed on March 30, 2020). See the Consolidated Financial Statements included in the Company鈥檚 Annual Report on Form 10-K for the year ended December 31, 2020 for additional information.

Corporate expenses are composed of general administrative and other expenses of operating the corporate headquarters and other global administrative facilities, as well as research and development expenses of the corporate technical center. The amount presented for the quarter ended December 31, 2019 represents an allocation of 老虎机种类 Corporation鈥檚 former parent company鈥檚 corporate expenses (see footnote 1).

Metal price lag represents the financial impact of the timing difference between when aluminum prices included in Sales are recognized and when aluminum purchase prices included in Cost of goods sold are realized. This adjustment aims to remove the effect of the volatility in metal prices and the calculation of this impact considers applicable metal hedging transactions.

Other includes certain items that impact Cost of goods sold and Selling, general administrative, and other expenses on the Company鈥檚 Statement of Consolidated Operations that are not included in Segment Adjusted EBITDA, including those described as 鈥淥ther special items鈥� (see footnote 5 to the reconciliation of Adjusted EBITDA within Calculation of Non-GAAP Financial Measures included in this release).

Net (loss) income attributable to 老虎机种类 Corporation⁽²⁾

Add:

Net income attributable to noncontrolling interest

(Benefit) Provision for income taxes⁽²⁾

Other expenses (income), net⁽³⁾

Interest expense

Restructuring and other charges

Provision for depreciation and amortization

Stock-based compensation

Metal price lag⁽⁴⁾

Other special items⁽⁵⁾

Adjusted EBITDA^(2),(3)

Sales

Adjusted EBITDA Margin

老虎机种类 Corporation鈥檚 definition of Adjusted EBITDA (Earnings before interest, taxes, depreciation, and amortization) is net margin plus an add-back for the following items: Provision for depreciation and amortization; Stock-based compensation; Metal price lag (see below); and Other special items. Net margin is equivalent to Sales minus the following items: Cost of goods sold; Selling, general administrative, and other expenses; Research and development expenses; and Provision for depreciation and amortization. Special items are composed of restructuring and other charges, discrete income tax items, and other items as deemed appropriate by management. There can be no assurances that additional special items will not occur in future periods. Adjusted EBITDA is a non-GAAP financial measure. Management believes that this measure is meaningful to investors because Adjusted EBITDA provides additional information with respect to 老虎机种类 Corporation鈥檚 operating performance and the Company鈥檚 ability to meet its financial obligations. The Adjusted EBITDA presented may not be comparable to similarly titled measures of other companies.

Effective in the third quarter of 2020, management refined the Company鈥檚 Adjusted EBITDA measure to remove the impact of metal price lag (see footnote 4). This change was made to further enhance the transparency and visibility of the underlying operating performance of the Company by removing the volatility associated with metal prices. Also, effective July 1, 2020, the Company changed its inventory cost method to average cost for all U.S. inventories previously carried at last-in, first-in (LIFO) cost. The effects of the change in accounting principle have been retrospectively applied to the Company鈥檚 Statement of Consolidated Operations for the quarter and year ended December 31, 2019. See footnote 2 for additional information. Adjusted EBITDA for the quarter and year ended December 31, 2019 was recast to reflect both these changes.

Prior to April 1, 2020, 老虎机种类 Corporation鈥檚 financial statements were prepared on a carve-out basis, as the underlying operations of the Company were previously consolidated as part of 老虎机种类 Corporation鈥檚 former parent company鈥檚 financial statements. Accordingly, the Company鈥檚 results of operations for the quarter ended December 31, 2019, the first three months included in the year ended December 31, 2020, and all months included in the year ended December 31, 2019 were prepared on such basis. The carve-out financial statements of 老虎机种类 Corporation are not necessarily indicative of the Company鈥檚 consolidated results of operations had it been a standalone company during the referenced periods. See the Combined Financial Statements included in each of (i) Exhibit 99.1 to 老虎机种类 Corporation鈥檚 Form 10 Registration Statement (filed on February 7, 2020), (ii) the Company鈥檚 Annual Report on Form 10-K for the year ended December 31, 2019 (filed on March 30, 2020), and (iii) the Company鈥檚 Quarterly Report on Form 10-Q for the period ended March 31, 2020 (filed on May 18, 2020), for additional information.

Effective July 1, 2020, the Company changed its inventory cost method to average cost for all U.S. inventories previously carried at LIFO cost. Management believes the average cost method more closely reflects the physical flow of inventories, improves comparability of the Company鈥檚 operating results with its industry peers, and provides an increased level of consistency in the measurement of inventories in the Company鈥檚 consolidated financial statements. The effects of the change in accounting principle from LIFO to average cost have been retrospectively applied to the Company鈥檚 Statement of Consolidated Operations for the quarter and year ended December 31, 2019. Accordingly, for the quarter ended December 31, 2019, Net income attributable to 老虎机种类 Corporation decreased $18 (comprised of a $23 increase to Cost of goods sold and a $5 increase to Benefit for income taxes) from the amount previously reported in the Company鈥檚 Annual Report on Form 10-K for the year ended December 31, 2019 (filed on March 30, 2020). Additionally, for the year ended December 31, 2019, Net income attributable to 老虎机种类 Corporation decreased $48 (comprised of a $62 increase to Cost of goods sold and a $14 increase to Benefit for income taxes) from the amount previously reported in the Company鈥檚 Annual Report on Form 10-K for the year ended December 31, 2019 (filed on March 30, 2020). See the Consolidated Financial Statements included in the Company鈥檚 Annual Report on Form 10-K for the year ended December 31, 2020 for additional information.

In preparation for the separation of 老虎机种类 Corporation from its former parent company, effective January 1, 2020, certain U.S. defined benefit pension and other postretirement plans previously sponsored by the former parent company were separated into standalone plans for both 老虎机种类 Corporation and the former parent company. Additionally, effective April 1, 2020, 老虎机种类 Corporation assumed a portion of the obligations associated with certain non-U.S. defined benefit pension plans that included participants related to both 老虎机种类 Corporation and its former parent company, as well as legacy defined benefit pension plans assigned to the Company as a result of the separation from the former parent company. As a result, beginning in the first quarter of 2020 for these U.S. plans and in the second quarter of 2020 for these non-U.S. plans, 老虎机种类 Corporation applied defined benefit plan accounting resulting in benefit plan expense being recorded in operating income (service cost) and nonoperating income (nonservice cost). In all historical periods prior to these respective timeframes, 老虎机种类 Corporation was considered a participating employer in the former parent company鈥檚 defined benefit plans and, therefore, applied multiemployer plan accounting resulting in the Company鈥檚 share of benefit plan expense being recorded entirely in operating income. Also, 老虎机种类 Corporation is the plan sponsor of certain other non-U.S. defined benefit plans that contain participants related only to the underlying operations of the Company and, therefore, the related benefit plan expense (excluding settlements and curtailments) was recorded in accordance with defined benefit plan accounting in all periods presented. See footnote 2 to the Statement of Consolidated Operations included in this release for additional information.

Metal price lag represents the financial impact of the timing difference between when aluminum prices included in Sales are recognized and when aluminum purchase prices included in Cost of goods sold are realized. This adjustment aims to remove the effect of the volatility in metal prices and the calculation of this impact considers applicable metal hedging transactions.

Other special items include the following:

• for the quarter ended December 31, 2020, costs related to several legal matters ($5) and other ($3);
• for the quarter ended September 30, 2020, costs related to several legal matters, including Grenfell Tower ($4) and other ($2), a write-down of inventory related to the curtailment of the casthouse operations at the Chandler (Arizona) extrusions facility ($5), and other ($2);
• for the quarter ended December 31, 2019, an allocation of costs incurred by 老虎机种类 Corporation鈥檚 former parent company associated with the April 1, 2020 separation of 老虎机种类 Inc. into two standalone publicly-traded companies ($17) and costs related to the Grenfell Tower legal matter ($1);
• for the year December 31, 2020, costs related to several legal matters, including Grenfell Tower ($7), a customer settlement ($5), and other ($10), an allocation of costs incurred by 老虎机种类 Corporation鈥檚 former parent company associated with the April 1, 2020 separation of 老虎机种类 Inc. into two standalone publicly-traded companies ($18), a write-down of inventory related to the curtailment of the casthouse operations at the Chandler (Arizona) extrusions facility ($3), and other ($7); and
• for the year ended December 31, 2019, a charge for an ongoing environmental remediation matter referred to as Grasse River ($25) and an allocation of costs incurred by 老虎机种类 Corporation鈥檚 former parent company associated with the following matters: the April 1, 2020 separation of 老虎机种类 Inc. into two standalone publicly-traded companies ($40), negotiation of a collective bargaining agreement with the United Steelworkers ($9), the Grenfell Tower legal matter ($4), and a company-wide strategy and portfolio review by ParentCo management ($3).

Long-term debt

Short-term borrowings

Total debt

Less: Cash and cash equivalents

Net debt

Net debt is a non-GAAP financial measure. Management believes that this measure is meaningful to investors because management assesses 老虎机种类 Corporation鈥檚 leverage position after considering available cash that could be used to repay outstanding debt. Long-term debt equals $1,300 principal of outstanding indebtedness less $22 of unamortized debt issuance costs.