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What changed in TRIMAS CORP's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of TRIMAS CORP's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+310 added−295 removedSource: 10-K (2025-02-27) vs 10-K (2024-02-29)

Top changes in TRIMAS CORP's 2024 10-K

310 paragraphs added · 295 removed · 236 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

72 edited+12 added−7 removed87 unchanged
Biggest changeMarketing, Customers and Distribution The customers of our Specialty Products segment predominantly operate in the broader industrial end markets, and to a lesser extent, the upstream oil and gas end markets. Given the focused nature of many of our products, we rely upon a combination of a direct sales force and an established network of distributors familiar with the end-users.
Biggest changeGiven the wide range of applications for many of our products, we rely upon a combination of a direct sales force and an established network of distributors familiar with the end-users. Our primary customers include industrial gas producers and distributors, welding equipment distributors, equipment manufacturers and the Department of Defense.
Each of our brands are long-term, certified suppliers of aerospace original equipment manufacturers ("OEMs") or Tier One suppliers, and have been serving the aerospace industry for decades.
Our brands are long-term, certified suppliers of aerospace original equipment manufacturers ("OEMs") or Tier One suppliers, and have been serving the aerospace industry for decades.
Through a multi-layered approach to product and process innovation starting with subject matter experts, our TriMas Packaging team is focused on driving innovation across a broad range of solutions for our customers. Our New Product Development teams are also supported by our TriMas Center of Excellence, located in New Delhi, India, to enhance our technical innovation and development.
Through a multi-layered approach to product and process innovation starting with subject matter experts, our TriMas Packaging team is focused on driving innovation across a broad range of solutions for our customers. Our New Product Development teams are also supported by our TriMas Center of Excellence, located near New Delhi, India, to enhance our technical innovation and development.
Trade Policies and Regulations Free trade laws and regulations provide certain duties and tariffs on qualifying imports and exports, subject to compliance with the applicable classification and other requirements. In the past few years, we have experienced higher input costs as a direct result of tariffs imposed on certain raw materials and components imported from China.
Trade Policies and Regulations Free trade laws and regulations provide certain duties and tariffs on qualifying imports and exports, subject to compliance with the applicable classification and other requirements. In the past, we have experienced higher input costs as a direct result of tariffs imposed on certain raw materials and components imported from China.
We believe that we supply products for the majority of the new airplanes manufactured by the three largest global airplane OEMs, either directly or through a critical distribution network. 9 Table of Contents • Product Innovation. We believe that TriMas Aerospace's engineering, research and development capability and new product focus are competitive advantages.
We believe that we supply products for the majority of the new airplanes manufactured by many of the largest global airplane OEMs, either directly or through a critical distribution network. 9 Table of Contents • Product Innovation. We believe that TriMas Aerospace's engineering, research and development capability and new product focus are competitive advantages.
In addition to product innovation, we also value process innovation and believe we can solidify our customer relationships using new innovative processes and manufacturing "know-how" to improve our quality, speed to develop and commercialize, sustainability and overall competitiveness, increasing customer satisfaction, as well as our performance. • Accelerate Growth with Strategic Acquisitions.
In addition to product innovation, we also value process innovation and believe we can solidify our customer relationships using new innovative processes and manufacturing "know-how" to improve our quality, speed to develop and commercialize, sustainability and overall competitiveness, increasing customer satisfaction, as well as our performance. • Enhance Growth with Strategic Acquisitions.
We typically seek to acquire adjacent product lines that expand our existing product offerings, gain access to new customers and end markets, expand our geographic footprint and/or capitalize on scale and cost efficiencies. Between 2019 and 2023, TriMas completed ten acquisitions and one divestiture.
We typically seek to acquire adjacent product lines that expand our existing product offerings, gain access to new customers and end markets, expand our geographic footprint and/or capitalize on scale and cost efficiencies. Between 2019 and 2024, TriMas completed ten acquisitions and one divestiture.
The combination of the Monogram, Allfast, Mac Fasteners and TFI brands enables TriMas Aerospace to offer a wide range of fastener products which address a broad scope of customer requirements, providing scale to customers who continue to rationalize their supply base.
The combination of the Monogram Aerospace Fasteners ("Monogram"), Allfast Fastening Systems ("Allfast"), Mac Fasteners and TFI Aerospace ("TFI") brands enables TriMas Aerospace to offer a wide range of fastener products which address a broad scope of customer requirements, providing scale to customers who continue to rationalize their supply base.
This facility enables TriMas Packaging to shift production of a variety of products currently produced outside of the United States closer to our customers, and supports new business growth closer to our customers in North America, as needed.
This facility enables TriMas Packaging to shift production of a variety of products currently manufactured outside of the United States closer to our customers, and supports new business growth closer to our customers in North America, as needed.
Management compensation is tied to financial results through short-term incentive plans, long-term equity incentive programs and Company-established stock ownership guidelines. 4 Table of Contents Our Strategy Guided by our experienced management team, we are focused on the following components that comprise our core strategy: • Leverage our TriMas Business Model.
Management compensation is tied to financial results through short-term incentive plans, long-term equity incentive programs and Company-established stock ownership guidelines. 4 Table of Contents Our Strategy Guided by our experienced management team, we are focused on the following components that comprise our enterprise-wide strategy: • Leverage our TriMas Business Model.
TriMas Aerospace is also capable of advanced precision computer numerical controlled ("CNC") milling, high performance CNC turning and assembly, working in a variety of metals including super alloys, stainless steel, aircraft steel alloys, carbon steel alloys and aluminum alloys. Many of TriMas Aerospace's products, facilities and manufacturing processes are required to be qualified and/or certified.
TriMas Aerospace is also capable of advanced precision computer numerical controlled ("CNC") milling, high performance CNC turning and assembly, metal forming and welding, working in a variety of metals including super alloys, stainless steel, aircraft steel alloys, carbon steel alloys and aluminum alloys. Many of TriMas Aerospace's products, facilities and manufacturing processes are required to be qualified and/or certified.
In April 2023, we acquired the operating assets of Weldmac, a leading designer and manufacturer of high-performance, complex metal fabricated components and assemblies for the aerospace, defense and space launch end markets.
In April 2023, we acquired the operating assets of Weldmac Manufacturing Company ("Weldmac"), a leading designer and manufacturer of high-performance, complex metal fabricated components and assemblies for the aerospace, defense and space launch end markets.
We believe TriMas is uniquely positioned to leverage our relatively low debt profile and strong free cash flow profile to identify and complete bolt-on acquisitions annually as part of our capital allocation strategy.
We believe TriMas is uniquely positioned to leverage our relatively low debt profile and strong free cash flow profile to identify and complete acquisitions annually as part of our capital allocation strategy.
TriMas' acquisition priorities are to build out our Packaging platform, which comprised 52% o f our consolidated net sales in 2023, with a focus on expanding in the life sciences, beauty, and food & beverage end markets, as well as to explore unique, strategic opportunities to build out our Aerospace platform, with a priority on expanding in fastener, fitting and latch applications.
TriMas' acquisition priorities are to build out our Packaging platform, which comprised 55% o f our consolidated net sales in 2024, with a focus on expanding in the beauty, food & beverage, and life sciences end markets, as well as to explore unique, strategic opportunities to build out our Aerospace platform, with a priority on expanding in fastener, fitting and latch applications.
These objectives are reinforced by our Code of Conduct, our global policies, including our Global Human Rights Policy, Diversity, Equity & Inclusion Statement, Supplier Code of Conduct, and Environment, Health & Safety Policy, as well as our commitment to sustainability as evidenced by our annual Sustainability Reports. 12 Table of Contents Commitment to Safety Our first objective under the TBM is the health and safety of our employees, including anyone who conducts business on our behalf.
These objectives are reinforced by our Code of Conduct, our global policies, including our Global Human Rights Policy, Supplier Code of Conduct, and Environment, Health & Safety Policy, as well as our commitment to sustainability as evidenced by our annual Sustainability Reports. 12 Table of Contents Commitment to Safety Our first objective under the TBM is the health and safety of our employees, including anyone who conducts business on our behalf.
We strive to be a great employer through our demonstrated commitment to employee safety, diversity, equity and inclusion, talent development and workplace culture. We embrace the tools of Kaizen, which is predicated on engaging our employees to identify cost effective ways to improve all aspects of our businesses, throughout our manufacturing operations and support services.
We strive to be a great employer through our demonstrated commitment to employee safety, workplace belonging, talent development and workplace culture. We embrace the tools of Kaizen, which is predicated on engaging our employees to identify cost effective ways to improve all aspects of our businesses, throughout our manufacturing operations and support services.
TriMas Aerospace also manufactures and assembles complex, highly-engineered and proprietary ducting, connectors and related products for air management systems, and other complex machine-to-print parts for aerospace applications, including auxiliary power units and electrical, hydraulic and pneumatic systems.
TriMas Aerospace also manufactures and assembles complex, highly-engineered and proprietary ducting, connectors and related products for air management systems, formed and welded metal, and other complex machine-to-print parts for aerospace applications, including auxiliary power units and electrical, hydraulic and pneumatic systems.
Approximately 72% of our 2023 net sales were generated from sales in North America. Our Competitive Strengths TriMas reports its operating activities in three segments: Packaging, Aerospace and Specialty Products. Our management team believes TriMas is uniquely positioned because of a number of competitive strengths, including: • Well-Recognized and Established Brands.
Approximately 77% of our 2024 net sales were generated from sales in North America. Our Competitive Strengths TriMas reports its operating activities in three segments: Packaging, Aerospace and Specialty Products. Our management team believes TriMas is uniquely positioned because of a number of competitive strengths, including: • Well-Recognized and Established Brands.
In general, these products are customer-specific and are manufactured utilizing customer-qualified and proprietary processes. The products also satisfy rigorous customer approvals or meet unique aerospace industry standards, and as such, we believe there are a limited set of competitors. We believe our brands are well established and recognized in their markets.
Many of these products are customer-specific and are manufactured utilizing customer-qualified and proprietary processes. The products also satisfy rigorous customer requirements or meet unique aerospace industry standards, and as such, we believe there are a limited set of competitors. We believe our brands are well established and recognized in their markets.
We operate manufacturing facilities in Canada, China, Germany, India, Italy, Mexico, the Netherlands, Slovakia, the United Kingdom and Vietnam, in addition to our U.S. operations. In addition to the net sales derived from sales by our businesses located outside of the United States, we also generated $72.2 million of export sales from the United States.
We operate manufacturing facilities in Canada, China, Germany, India, Italy, Mexico, the Netherlands, Slovakia, the United Kingdom and Vietnam, in addition to our U.S. operations. In addition to the net sales derived from sales by our businesses located outside of the United States, we also generated $82.7 million of export sales from the United States.
As a result of its flexible manufacturing footprint, TriMas Packaging was able to close a leased manufacturing facility in Rohnert Park, California, and reposition all of the production assets to other U.S. production facilities, announce the exit of a leased warehouse in Irwindale, California, and consolidate two manufacturing facilities located in China into one new facility which will provide improved efficiencies and position the business better for growth in the region.
As a result of its flexible manufacturing footprint, TriMas Packaging was able to close a leased manufacturing facility in Rohnert Park, California, and reposition all of the production assets to other U.S. production facilities, announce the exit of a leased warehouse in Irwindale, California, and consolidate two manufacturing facilities located in China into one new facility which has provided improved efficiencies and positioned the business better for growth in the region.
Our main Packaging brands include Rieke ® , Affaba & Ferrari™, Taplast™, Rapak ® , and Aarts Packaging™, and our main Life Sciences brands include Intertech™ and Omega Plastics™ (all of which make up the TriMas Packaging group and are collectively reported in the Packaging segment).
Our main Packaging brands include Rieke ® , Affaba & Ferrari™, Taplast™, Rapak ® and Aarts Packaging™, which are also marketed under the TriMas Packaging brand, and Intertech™ and Omega Plastics™, which are also marketed under the TriMas Life Sciences brand (all of which make up the TriMas Packaging group and are collectively reported in the Packaging segment).
We have one facility, located in Commerce, California, where our hourly employees operate under a collective bargaining agreement, and which represents 12% of our U.S. employees. We have four facilities outside of the United States where our employees are affiliated with work councils, which covers 21% of our non-U.S. employees.
We have one facility, located in Commerce, California, where our hourly employees operate under a collective bargaining agreement, and which represents 13% of our U.S. employees. We have six facilities outside of the United States where our employees are affiliated with work councils, which covers 13% of our non-U.S. employees.
With more than 70 years of experience, Norris Cylinder is one of the worlds' largest manufacturers of high- and low-pressure forged steel cylinders, and the only manufacturer in the United States.
With more than 70 years of experience, Norris Cylinder is one of the worlds' largest manufacturers of high- and low-pressure forged steel cylinders, and the only manufacturer of forged Type 1 steel cylinders that remains in the United States.
While there are other manufacturers of steel cylinders globally, the installation of manufacturing processes and adding new capacity tends to be a lengthy process and a costly investment to implement.
While there are other manufacturers of steel cylinders globally, the installation of Type 1 steel cylinder manufacturing processes and adding new capacity tends to be a lengthy process and a very costly investment to implement.
Competitive Strengths We believe our Specialty Products segment benefits from the following competitive strengths in coordination with operating under TriMas' overarching strategy: • Leading Market Positions and Strong Brand Names .
Competitive Strengths We believe our Specialty Products segment benefits from the following competitive strengths in coordination with operating under TriMas' overarching strategy: • Leading Market Position and Strong Brand Name .
We believe our businesses share important and distinguishing characteristics, including: well-recognized brand names in the markets we serve; innovative product technologies and features; customer-approved processes and qualified products; strong c ash flow generation; long-term growth opportunities; and a commitment to sustainability.
We believe our businesses share important and distinguishing characteristics, including: well-recognized brand names in the markets we serve; innovative produc t technologies and features; customer-approved processes and qualified products; strong cash flow generation; long-term growth opportunities; and a commitment to sustainability.
We also work to maintain appropriate standards of conduct in the workplace and to be sensitive to the concerns of our diverse group of employees.
We also work to maintain appropriate standards of conduct in the workplace and to be sensitive to the concerns of all of our employees.
We believe TriMas Packaging is a leading designer, developer and manufacturer of specialty, highly-engineered polymeric and steel closure and dispensing systems for a range of end markets, including consumer packaging (beauty & personal care, food & beverage, and home care), life science and industrial markets.
Packaging (55% of 2024 net sales) We believe the TriMas Packaging group is a leading designer, developer and manufacturer of specialty, highly-engineered polymeric and steel closure and dispensing systems for a range of end markets, including consumer packaging (beauty & personal care, food & beverage, and home care), life science and industrial markets.
We believe that we are a leader in one-sided installation (OSI), or blind bolt, applications with significant market share in all blind fastener product categories in which we compete. Specialty Products (21% of 2023 net sales) Our Specialty Products segment is comprised of our Norris Cylinder and Arrow Engine Company businesses.
We believe that we are a leader in one-sided installation (OSI), or blind bolt, applications with significant market share in all blind fastener product categories in which we compete. Specialty Products (13% of 2024 net sales) During 2024, our Specialty Products segment was comprised of our Norris Cylinder and Arrow Engine Company businesses.
Intangible Assets Our identified intangible assets, consisting of customer relationships, trademarks and trade names, and technology, are recorded at $181.0 million at December 31, 2023, net of accumulated amortization. The valuation of each of the identified intangibles was performed using broadly accepted valuation methodologies and techniques. Customer Relationships.
Intangible Assets Our identified intangible assets, consisting of customer relationships, trademarks and trade names, and technology, are recorded at $161.1 million at December 31, 2024, net of accumulated amortization. The valuation of each of the identified intangibles was performed using broadly accepted valuation methodologies and techniques. Customer Relationships.
For example, TriMas Packaging's product development programs have provided innovative and proprietary product solutions, such as the patent-pending, single-polymer Singolo TM pump, made from a single material making it fully recyclable without compromising quality, aesthetics, performance or formula compatibility, and comes in a variety of dosing options.
For example, TriMas Packaging's product development programs have provided innovative and proprietary product solutions, such as a range of fully-recyclable, polymeric Singolo TM pumps, made from a single material making it fully recyclable without compromising quality, aesthetics, performance or formula compatibility, and comes in a variety of dosing options.
Although we may experience delays in our ability to implement price increases, we have been generally able to recover such increased costs. Human Capital Resources As of December 31, 2023, we employed approximately 3,400 people, of which 38% were located outside the United States.
Although we may experience delays in our ability to implement price increases related to material costs, we have been generally able to recover such increased costs. Human Capital Resources As of December 31, 2024, we employed approximately 3,900 people, of which 44% were located outside the United States.
While there may be an impact to our financial condition as a result of changes in the amount of duties or tariffs levied on products we sell, we do not believe that costs to remain in compliance with such laws and regulations will have a material adverse effect on our business, financial condition, results of operations and cash flows.
While there may be an impact to our financial condition as a result of changes in the amount of duties or tariffs levied on products we import from China, and potentially other countries including Mexico and Canada, we do not believe that costs to remain in compliance with such laws and regulations will have a material adverse effect on our business, financial condition, results of operations and cash flows.
The TriMas Business Model ("TBM") serves as the platform to manage our diverse set of businesses under a common set of standards focused on driving long-term exceptional performance. Through the TBM, we set near- and long-term performance objectives, and utilize a reliable communication and escalation process that provides for flexibility and adjustments if market expectations change.
The TriMas Business Model ("TBM") serves as the platform to manage our diverse set of businesses under a common set of standards focused on continuous improvement and achieving operational excellence. Through the TBM, we set near- and long-term performance objectives, and utilize a reliable communication and escalation process that provides for flexibility and adjustments when market expectations change.
Our customers, including larger consumer products customers, often desire supply capability and a manufacturing footprint close to their end markets which results in more efficient supply chains, reduced carbon footprint and enhanced sustainability. To support these initiatives, we operate a newer, highly-automated facility in New Albany, Ohio, which began ramping up in 2022.
Our customers, including larger consumer products customers, often desire supply and manufacturing capabilities within their primary geographical end markets which results in more efficient supply chains, reduced carbon footprint and enhanced sustainability. To support these initiatives, we operate a newer, highly-automated facility in New Albany, Ohio, which began production in 2022.
Our acquisition priority is to build out the Packaging segment, with a focus in the areas of life sciences, beauty, and food & beverage applications, and increase TriMas’ weight in packaging-related end markets, which comprised 52% of consolidated net sales in 2023.
Our acquisition priority is to build out the Packaging platform, with a focus on beauty, food & beverage and life sciences applications, and increase TriMas’ weight in packaging-related end markets, which comprised 55% of consolidated net sales in 2024.
In addition, Norris Cylinder offers a complete line of steel cylinders used to contain and dispense acetylene gas for the welding and cutting industries. Norris Cylinder's products meet the rigorous standards required by the U.S. Department of Transportation (DOT) or International Standards Organization (ISO), which certifies a cylinder's adequacy to perform in specific applications.
In addition, Norris Cylinder offers a complete line of steel cylinders used to contain and dispense acetylene gas for the heating, ventilation and air conditioning (HVAC) and construction end markets. Norris Cylinder's products meet the rigorous standards required by the U.S. Department of Transportation (DOT) or International Standards Organization (ISO), which certifies a cylinder's adequacy to perform in specific applications.
We embrace the tools of Kaizen and work to foster a culture of employee engagement to drive performance improvements and operational excellence. We believe that employee feedback is important which is why, in 2021, 2022 and 2023, we administered employee engagement surveys globally.
We embrace the tools of Kaizen and work to foster a culture of employee engagement to drive performance improvements and operational excellence. We believe that employee feedback is important which is why, for the past four years, we administered employee engagement surveys globally.
For example, 20 patents were filed and 88 patents were issued in 2023, related to both new and existing patent families. • Customized Solutions that Enhance Customer Relationships .
For example, 42 patents were filed and 81 patents were issued in 2024, related to both new and existing patent families. • Customized Solutions that Enhance Customer Relationships .
We believe these moves will better shape our presence in growth end markets, improve our overall portfolio of businesses and augment long-term growth. Materials and Supply Arrangements Our largest raw material purchases are for resins (such as polypropylene and polyethylene), steel, aluminum and other metal and non-metal-based purchased components.
We believe these moves will better shape our presence in higher growth end markets, improve our overall portfolio by building out our two highest growth platforms and augment long-term core growth. Materials and Supply Arrangements Our largest raw material purchases are for resins (such as polypropylene and polyethylene), steel, aluminum, super alloys, and other metal and non-metal-based purchased components.
We believe that TriMas Aerospace is a leading designer, developer and manufacturer of a broad range of engineered fasteners for the aerospace industry, as well as other complex machined components such as those used in air ducting systems.
We believe that TriMas Aerospace is a leading designer, developer and manufacturer of a broad range of engineered fasteners for the aerospace industry, as well as other complex formed metal, ducting and machined components.
Our Aerospace brands include Monogram Aerospace Fasteners ® , Allfast ® Fastening Systems, Mac Fasteners™, RSA Engineered Products™, Weldmac Manufacturing Company™, Martinic Engineering™ and TFI Aerospace™ (all of which make up the TriMas Aerospace™ group and are collectively reported in the Aerospace segment). Norris Cylinder™ and Arrow ® Engine Company are the brands reported within the Specialty Products segment.
Our Aerospace brands include Monogram Aerospace Fasteners ® , Allfast ® Fastening Systems, Mac Fasteners™, RSA Engineered Products™, Weldmac Manufacturing Company™, Martinic Engineering™ and TFI Aerospace™, which are also marketed under the TriMas Aerospace brand (all of which make up the TriMas Aerospace™ group and are collectively reported in the Aerospace segment).
During 2023, as a result of temporal, significant industry-wide demand softness, TriMas Packaging took proactive actions to optimize its manufacturing footprint and better position its business to capture future operating leverage gains when end market demand recovers to more normalized levels.
During 2023, as a result of temporal, but significant industry-wide destocking and resulting demand softness, TriMas Packaging took proactive actions to optimize its manufacturing footprint and better position its business to capture future operating leverage gains.
As such, in periods of rising demand, as we have experienced in 2021 through the majority of 2023, Norris Cylinder's installed capacity and manufacturing presence in the United States provides an advantage when compared to non-U.S. suppliers dealing with logistic constraints.
We believe that in periods of high demand, such as what was experienced in 2021 through the majority of 2023, Norris Cylinder's installed and fixed capacity and manufacturing presence in the United States provides an advantage when compared to non-U.S. suppliers that from time to time deal with logistic constraints.
International Operations Of our net sales for the year ended December 31, 2023, 23.8% were derived from sales by our businesses located outside of the United States, and 35.5% of our long-lived assets as of December 31, 2023 were located outside of the United States.
International Operations Of our net sales for the year ended December 31, 2024, 25.1% were derived from sales by our businesses located outside of the United States, and 34.2% of our long-lived assets as of December 31, 2024 were located outside of the United States.
We believe each of our go-to-market brands is well-recognized and firmly established in the end markets we serve. We believe our brands represent high standards and a commitment to quality and service that our customers rely on, and in many cases certify or audit, when making their sourcing decisions. • Innovative and Proprietary Manufacturing and Product Technologies.
We believe our brands represent high standards and a commitment to quality and service that our customers rely on, and in many cases certify or audit, when making their sourcing decisions. • Innovative and Proprietary Manufacturing and Product Technologies.
We strive to incorporate the concept of sustainability into our decision-making model and continue to increase the importance of sustainability in everything we do. 5 Table of Contents Our Businesses We report the results of our operations in three segments, which had net sales and operating profit for the year ended December 31, 2023 as follows: Packaging (net sales: $463.6 million; operating profit: $60.1 million), Aerospace (net sales: $241.4 million; operating profit: $15.5 million) and Specialty Products (net sales: $188.6 million; operating profit: $36.4 million).
We strive to incorporate the concept of sustainability into our decision-making model and continue to increase the importance of sustainability in everything we do. 5 Table of Contents Our Businesses We report the results of our operations in three segments, which had net sales and operating profit for the year ended December 31, 2024 as follows: Packaging (net sales: $512.3 million; operating profit: $68.1 million), Aerospace (net sales: $294.2 million; operating profit: $33.8 million) and Specialty Products (net sales: $118.5 million; operating loss: $2.0 million).
Our Specialty Products businesses have long-standing customer relationships and distributes directly to major companies, as well as distributing to domestic buying groups, OEMs, medium and small independent companies, and independent distributors.
Our Specialty Products businesses, particularly our Norris Cylinder business, have long-standing customer relationships, including important qualifications, and distributes directly to major companies, as well as distributing to domestic buying groups, OEMs, medium and small independent companies, the Department of Defense, and independent distributors.
Competition Norris Cylinder's competitors include Beijing Tianhai Industry Co., ENK Co., Everest Kanto Cylinder, Faber, MAT S/A Gas Cylinders and Zhejiang Jindun Pressure Vessel Co., which are all non-U.S. companies, among others. Norris Cylinder is the only remaining high pressure, forged steel cylinder manufacturer in the United States.
Our Specialty Products manufacturing facilities are located in the United States. 11 Table of Contents Competition Norris Cylinder's competitors include Beijing Tianhai Industry Co., ENK Co., Everest Kanto Cylinder, Faber, MAT S/A Gas Cylinders and Zhejiang Jindun Pressure Vessel Co., which are all non-U.S. companies, among others.
We believe that Norris has a reputation for high-quality cylinders used in a variety of applications, including industrial gas, welding and cutting, government, medical, laboratories, food and beverage technology, breathing air, fire protection and aviation.
We believe that Norris has a reputation for high-quality cylinders used in a variety of applications, including industrial gas, welding and cutting, government, medical, laboratories, food and beverage technology, breathing air, fire protection and aviation. • Comprehensive Product Offering . We believe our businesses within Specialty Products, particularly Norris Cylinder, offer comprehensive product offerings that meets their customers' needs.
Our long-standing supply position in these well-established networks has allowed our Specialty Products businesses to successfully navigate some of the most robust, as well as harshest, economic cycles. • Difficult and Costly to Replicate Manufacturing Base. Our Norris Cylinder business has locations in Longview, Texas, and Huntsville, Alabama, which have numerous forging and metalworking pieces of equipment and processes.
Our long-standing supply position in these well-established networks has allowed our Specialty Products businesses to successfully navigate some of the most robust, as well as harshest, economic cycles. • Difficult and Costly to Replicate Manufacturing Base.
Our goal is to foster working environments that are fair, equitable and safe, where rights are respected, and everyone can achieve their full potential. Our policies and practices strive to assure equal employment and advancement opportunities for all qualified people.
We believe that tapping into our employees' backgrounds and experiences ensures we make better decisions and supports stronger operating performance. Our goal is to foster working environments that are fair and safe, where rights are respected, and everyone can achieve their full potential. Our policies and practices strive to assure equal employment and advancement opportunities for all qualified people.
We believe that both Norris Cylinder and Arrow Engine offer comprehensive product offerings that meets their customers' needs. Norris Cylinder offers a complete line of large, intermediate and small size, high and low-pressure steel cylinders to its customers across a variety of end markets.
Norris Cylinder offers a complete line of large, intermediate and small size, high and low-pressure steel cylinders to its customers across a variety of end markets.
Arrow Engine manufactures its own engine line and also offers a wide variety of spare parts for various industrial engines not manufactured by Arrow Engine. We have initiated the sales process for the Arrow Engine business, which, when completed, would facilitate an exit of our presence in the oil and gas end market.
Arrow Engine manufactures its own engine line and also offers a wide variety of spare parts for various industrial engines not manufactured by Arrow Engine. On January 31, 2025, we announced the successful completion of the previously announced sale of the Arrow Engine business, facilitating an exit of our direct presence in the oil and gas end market.
Our acquisitions of Affaba & Ferrari, Taplast, Aarts Packaging and Plastic Srl have provided us with additional sales, design and manufacturing capacity in Europe, with additional manufacturing facilities in the Netherlands, Italy and Slovakia. In addition, we are starting to expand our supply capabilities into South America, opening our first warehouse in Brazil in 2022.
Our acquisitions of Affaba & Ferrari, Taplast, Aarts Packaging and Plastic Srl have provided us with additional sales, design and manufacturing capacity in Europe, with additional manufacturing facilities in the Netherlands, Italy and Slovakia.
We believe TriMas, through its relatively low financial leverage and its strong free cash flow, is uniquely positioned to enhance organic growth with strategic acquisitions.
We believe TriMas, through its relatively low debt leverage, manageable interest expense and resulting cash generation profile, is uniquely positioned to enhance organic growth with strategic bolt-on acquisitions.
Headquartered in Bloomfield Hills, Michigan, TriMas has approximately 3,400 e mployees who serve our customers from 38 manufacturing and support locations in 13 c ountries. During 2023, our net sales were $893.6 million, operating profit was $65.4 million, and net ca sh provided by operating activities was $88.2 million.
Headquartered in Bloomfield Hills, Michigan, TriMas has approximately 3,900 employees who serve our customers from 37 manufacturing and support locations in 13 countries. During 2024, our net sales were $925.0 million, operating profit was $47.2 million, and net ca sh provided by operating activities was $63.8 million.
In addition, RSA has extensive experience in providing air ducting, connectors and flexible joints used in hot engine bleed air, anti-icing and environmental control system applications. Martinic has a reputation, with more than 40 years of experience, of specializing in the high-complexity machining of castings, forgings and bar stock for leading Tier One commercial and defense aerospace OEMs.
Martinic Engineering ("Martinic") has a reputation, with more than 40 years of experience, of specializing in the high-complexity machining of castings, forgings and bar stock for leading Tier One commercial and defense aerospace OEMs.
In certain cases, we have passed-through these incremental costs to the customer, while in some cases we have not changed pricing to retain or expand volume, and in other cases we continue to work to install capacity in facilities where there currently is no tariff.
In certain cases, we have passed-through these incremental costs to the customer, while in some cases we have not changed pricing in order to retain or expand volumes. In other cases, we continued to install incremental capacity in facilities which were not subject to duties or tariffs.
We continue to work on our engagement as a company, with managers actively facilitating engagement discussions with their teams and developing action plans to ensure progress and continuous improvement.
We continue to work on our engagement as a company, with managers actively facilitating engagement discussions with their teams and developing action plans to ensure progress and continuous improvement. Workplace Belonging We believe we are at our best when we bring together unique perspectives, experiences and ideas, and actively build inclusive work environments across our global locations.
We believe these businesses are well-established and recognized in the end markets they serve. 10 Table of Contents TriMas' Norris Cylinder business is a leading designer, manufacturer and distributor of highly-engineered steel cylinders for use in industrial, heating, ventilation and air conditioning (HVAC), construction, health care and defense end markets.
We believe these businesses are well-established and recognized in the end markets they serve. 10 Table of Contents TriMas' Norris Cylinder business is a leading designer, manufacturer and distributor of highly-engineered, large, intermediate and small size, high and low-pressure Type 1 steel cylinders for the transportation, storage and dispensing of packaged and compressed gases.
In addition, TriMas Packaging recently launched tethered caps, which are caps that remain attached to a bottle or container after opening and during use to increase ease of recycling.
We have also expanded the offering to include a full-plastic foamer, as well as a recyclable small dosage pump for treatment and liquid foundation applications. In addition, TriMas Packaging recently launched tethered caps, which are caps that remain attached to a bottle or container after opening and during use to increase ease of recycling.
In December 2021, we acquired TFI, a manufacturer and supplier of specialty fasteners used in a variety of applications, predominantly for use in the aerospace and industrial end markets. Competitive Strengths We believe TriMas Aerospace benefits from the following competitive strengths in coordination with operating under TriMas' overarching strategy: • Broad Product Portfolio of Established Brands .
Competitive Strengths We believe TriMas Aerospace benefits from the following competitive strengths in coordination with operating under TriMas' overarching strategy: • Broad Product Portfolio of Established Brands .
A key tenet of the TBM is our commitment to operational excellence and continuous improvement. We believe our operating performance will continue to benefit from the use of Kaizen as a means to drive our decision-making and investment processes.
We believe our operating performance will continue to benefit from the use of Kaizen as a means to drive our decision-making and investment processes. In addition to continuous improvement and goal setting, the TBM is also focused on environmental, health and safety, talent development, and flawless new product and process launches. • Invest in Innovation.
We intend to leverage our brands, expand our product offerings to current and new customers and geographic regions, and introduce innovative products to meet our customers' needs and help solve their challenges. We operate under a disciplined approach to defend and expand our product offerings, and grow our business over the longer term.
We continue to invest in organic growth in our most compelling end markets with the highest long-term return potential. We intend to leverage our brands, expand our product offerings to current and new customers and geographic regions, and introduce innovative products to meet our customers' needs and help solve their challenges.
We believe TriMas Aerospace is a leading designer and manufacturer of a diverse range of products, including, but not limited to, highly-engineered fasteners, collars, blind bolts, rivets, ducting and connectors for air management systems, and other highly-engineered machined parts and components, for use in focused markets within the aerospace and defense industry.
Depending on the product and customers served, our competitors include Aptar, Bericap, Berry Global (soon to be part of Amcor), Comar, Greif, Mold-Rite, Phoenix Closures, Silgan, Technocraft and other smaller private companies located in Asia. 8 Table of Contents Aerospace (32% of 2024 net sales) We believe the TriMas Aerospace group is a leading designer and manufacturer of a diverse range of products, including, but not limited to, highly-engineered fasteners, collars, blind bolts, rivets, ducting and connectors for air management systems, formed metal components and assemblies, and other highly-engineered machined parts and components, for use in focused markets within the aerospace and defense industry.
Our labor agreement with the United Automobile, Aerospace and Agricultural Implement Workers of America at our TriMas Aerospace facility in Commerce, California, expires in August 2024 and we expect to enter into timely negotiations regarding the extension of our agreement.
Our labor agreement with the United Automobile, Aerospace and Agricultural Implement Workers of America (UAW) at our TriMas Aerospace facility in Commerce, California, expired in August 2024, at which time the UAW initiated a strike, which lasted approximately ten weeks.
We provide products for commercial, business jet, and military and defense aerospace applications and platforms with sales to OEMs, supply chain distributors, maintenance, repair and overhaul (MRO) and aftermarket providers, and Tier One suppliers. Our customer-specified and/or qualified products are used in production of significant long-term aircraft programs, including several Boeing and Airbus commercial jetliner programs.
We provide products for commercial and regional jets, business jet, helicopters, and general aviation, as well as military, defense and space applications and platforms with sales to OEMs, supply chain distributors, maintenance, repair and overhaul (MRO) and aftermarket providers, and Tier One suppliers.
TriMas focuses on several human capital resources objectives in managing its business, including our commitment to health and safety, employee engagement, diversity, equity & inclusion, and talent development. These human capital resources objectives, taken together, may be material to understanding our business under certain circumstances.
These human capital resources objectives, taken together, may be material to understanding our business under certain circumstances.
We believe that Norris Cylinder is a leading provider of a complete line of large, intermediate and small size, high and low-pressure steel cylinders for the transportation, storage and dispensing of packaged and compressed gases. Norris Cylinder's large high-pressure seamless gas cylinders are used principally for shipping, storing and dispensing oxygen, nitrogen, argon, helium and other compressed gases.
Norris Cylinder's large high-pressure seamless gas cylinders are used principally for shipping, storing and dispensing oxygen, nitrogen, argon, helium and other compressed gases for use in industrial, heath care and defense end markets.
Arrow Engine tends to compete against natural gas powered, lower horsepower, multi-cylinder engines from manufacturers such as Caterpillar and Cummins engines, as well as engines from non-U.S. manufacturers and providers of electric-powered motors. TriMas' Acquisition Strategy TriMas views the pursuit of strategic acquisitions as core to augmenting its organic growth and achieving our overarching corporate strategy.
Norris Cylinder is the only remaining high pressure, Type 1 forged steel cylinder manufacturer in the United States. TriMas' Acquisition Strategy TriMas views the pursuit of strategic bolt-on acquisitions as core to augmenting its organic growth and achieving our overarching corporate strategy.
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In addition to continuous improvement and goal setting, the TBM is also focused on environmental, health and safety, talent development, and flawless new product and process launches. • Invest in Innovation. We continue to invest in organic growth in our most compelling end markets with the highest long-term return potential.
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Norris Cylinder™ is the main brand reported within the Specialty Products segment. We believe each of our go-to-market brands is well-recognized and firmly established in the end markets we serve.
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Packaging (52% of 2023 net sales) TriMas' Packaging segment includes the Rieke, Affaba & Ferrari, Taplast, Rapak, Aarts Packaging, Intertech and Omega Plastics brands, all of which make up the TriMas Packaging group.
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We operate under a disciplined approach to defend and expand our product offerings, and grow our business over the longer term.
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Depending on the product and customers served, our competitors include Aptar, Bericap, Berry Global, Comar, Greif, Mold-Rite, Phoenix Closures, Silgan, Technocraft and other smaller private companies located in Asia. 8 Table of Contents Aerospace (27% of 2023 net sales) Our Aerospace segment is comprised of the Monogram Aerospace Fasteners (“Monogram”), Allfast Fastening Systems (“Allfast”), Mac Fasteners, RSA Engineered Products (“RSA”), Weldmac Manufacturing Company ("Weldmac"), Martinic Engineering (“Martinic”) and TFI Aerospace (“TFI”) brands, all of which make up the TriMas Aerospace group.
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In addition, we have expanded our capabilities into South America, opening our first warehouse in Brazil in 2022, with local sales, marketing, technical, laboratory and supply chain teams supporting our customers in the region.
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We believe that the Arrow Engine brand is also well-known by companies that operate or own pump jacks or active wellheads for oil and natural gas extraction. Moreover, we believe larger remote power generation unit providers know the natural gas-fired Arrow Engine product offering as an input option for their larger power generation systems. • Comprehensive Product Offering .
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Our customer-specified and/or qualified products are used in production of significant long-term aircraft programs, including most Boeing and Airbus commercial jetliner programs.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeDepending on their nature and scope, such threats could potentially lead to the compromising of confidential information and communications, improper use of our systems and networks, manipulation and destruction of data, defective products, production downtimes and operational disruptions, which in turn could adversely affect our reputation, competitiveness and results of operations.
Biggest changeDepending on their nature and scope, cybersecurity threats, cybersecurity incidents or disruptions involving our systems, or the systems of our third-party business partners, could potentially lead to the compromising of confidential information and communications, loss of intellectual property, improper use of our systems and networks, manipulation, corruption and destruction of data, defective products, production downtimes and operational disruptions, as wells as, costs related to remediation or the payment of ransom, litigation, including commercial litigation, administrative, civil or criminal investigations or actions, regulatory intervention and sanctions or fines or investigation costs, which in turn could adversely affect our reputation, competitiveness, financial condition and results of operations.
International operations, particularly sales to emerging markets and manufacturing in non-U.S. countries, are subject to risks that are not present within U.S. markets, which include, but are not limited to, the following: • Volatility of currency exchange between the U.S. dollar and currencies in international markets; • Changes in local government regulations and policies including, but not limited to, foreign currency exchange controls or monetary policy, governmental embargoes, repatriation of earnings, expropriation of property, duty or tariff restrictions, investment limitations and tax policies; • Political and economic instability and disruptions, including labor unrest, civil strife, public health crises (including viral outbreaks such as the coronavirus), acts of war, guerrilla activities, insurrection and terrorism; • Legislation that regulates the use of chemicals; • Disadvantages of competing against companies from countries that are not subject to U.S. laws and regulations, including the Foreign Corrupt Practices Act ("FCPA"); • Compliance with international trade laws and regulations, including export control and economic sanctions, such as anti-dumping duties; • Difficulties in staffing and managing multi-national operations; • Limitations on our ability to enforce legal rights and remedies; • Tax inefficiencies in repatriating cash flow from non-U.S. subsidiaries that could affect our financial results and reduce our ability to service debt; • Reduced protection of intellectual property rights; and • Other risks arising out of foreign sovereignty over the areas where our operations are conducted.
International operations, particularly sales to emerging markets and manufacturing in non-U.S. countries, are subject to risks that are not present within U.S. markets, which include, but are not limited to, the following: • Volatility of currency exchange between the U.S. dollar and currencies in international markets; • Changes in local government regulations and policies including, but not limited to, foreign currency exchange controls or monetary policy, governmental embargoes, repatriation of earnings, expropriation of property, duty or tariff restrictions, investment limitations and tax policies; • Political and economic instability and disruptions, including labor unrest, civil strife, public health crises (including viral outbreaks such as the coronavirus), acts of war, guerrilla activities, insurrection and terrorism; • Legislation that regulates the use of chemicals; • Disadvantages of competing against companies from countries that are not subject to U.S. laws and regulations, including the Foreign Corrupt Practices Act ("FCPA"); • Compliance with international trade laws and regulations, including export control and economic sanctions, such as anti-dumping duties; • Difficulties in staffing and managing multi-national operations; • Limitations on our ability to enforce legal rights and remedies; • Tax inefficiencies in repatriating cash flow from non-U.S. subsidiaries that could affect our financial results and reduce our ability to service debt; • Reduced protection of intellectual property rights; and 19 Table of Contents • Other risks arising out of foreign sovereignty over the areas where our operations are conducted.
Although we have generally been able to recover costs increases, we may be unable to offset the impact of future cost increases with price increases on a timely basis due to outstanding commitments to our customers, competitive considerations or our customers’ resistance to accepting such price increases and our financial performance could be adversely impacted.
Although we have generally been able to recover certain costs increases, we may be unable to offset the impact of future cost increases with price increases on a timely basis due to outstanding commitments to our customers, competitive considerations or our customers’ resistance to accepting such price increases and our financial performance could be adversely impacted.
For example, our Aerospace manufacturing facilities are predominately located in southern California, an area known for earthquakes, and are thus vulnerable to damage. Any new facility would need to comply with the necessary regulatory requirements, satisfy our specialized manufacturing requirements and require specialized equipment.
For example, our Aerospace manufacturing facilities are predominately located in southern California, an area known for earthquakes and wildfires, and are thus vulnerable to damage. Any new facility would need to comply with the necessary regulatory requirements, satisfy our specialized manufacturing requirements and require specialized equipment.
Our largest raw material purchases are for resins (such as polypropylene and polyethylene), steel, aluminum superalloys (such as titanium, A286 stainless steel and Iconcel) and other oil and metal-based purchased components, each of which have experienced recent cost volatility. Prices for these products, along with costs for transportation and energy, fluctuate with market conditions, and have generally increased over time.
Our largest raw material purchases are for resins (such as polypropylene and polyethylene), steel, aluminum superalloys (such as titanium, A286 stainless steel and Inconel) and other oil and metal-based purchased components, each of which have experienced recent cost volatility. Prices for these products, along with costs for transportation and energy, fluctuate with market conditions, and have generally increased over time.
In 2023, our Aerospace and Specialty Products segments each had a customer that comprised 10% or more of its segment revenue. As a result of these factors, changes to or reductions in the buying patterns of these larger customers, including our customers diversifying their supply base, may expose our business and results of operations to greater volatility.
In 2024, our Aerospace and Specialty Products segments each had a customer that comprised 10% or more of its segment revenue. As a result of these factors, changes to or reductions in the buying patterns of these larger customers, including our customers diversifying their supply base, may expose our business and results of operations to greater volatility.
While no individual customer accounted for 10% or more of our consolidated net sales for 2023, 2022 or 2021, our customer base has become, and may further become, increasingly concentrated as a result of our strategy to focus on growing sales with existing customers in packaging end markets, or due to customer consolidations.
While no individual customer accounted for 10% or more of our consolidated net sales for 2024, 2023 or 2022, our customer base has become, and may further become, increasingly concentrated as a result of our strategy to focus on growing sales with existing customers in packaging end markets, or due to customer consolidations.
These tariffs, and other governmental actions relating to international trade agreements or policies, the adoption and expansion of trade restrictions, or the occurrence of a trade war may adversely impact demand for our products, costs, customers, suppliers and/or the U.S. economy or certain sectors thereof and, as a result, adversely impact our business.
These tariffs, and other governmental actions relating to international trade agreements or policies, the adoption and expansion of trade restrictions, or the occurrence of trade wars may adversely impact demand for our products, costs, customers, suppliers and/or the U.S. economy or certain sectors thereof and, as a result, adversely impact our business.
We cannot be assured that any of these indemnification provisions will fully protect us, and as a result we may incur unexpected liabilities that adversely affect our profitability and financial position. 19 Table of Contents Expectations relating to sustainability and ESG considerations could expose us to potential liabilities, increased costs, reputational harm and other adverse effects on our business.
We cannot be assured that any of these indemnification provisions will fully protect us, and as a result we may incur unexpected liabilities that adversely affect our profitability and financial position. Expectations relating to sustainability and ESG considerations could expose us to potential liabilities, increased costs, reputational harm and other adverse effects on our business.
If our manufacturing facilities become unavailable either temporarily or permanently due to weather, earthquakes or other natural disasters related to global climate change, or geopolitical developments, including any potential impacts resulting from tensions between the United States and China, or logistical complications or operational disruptions arising from adverse regulatory actions, acts of war, cyber-attacks, public health crises or labor disruptions, we may be unable to shift production to other facilities or to make up for lost production.
If our manufacturing facilities become unavailable either temporarily or permanently due to weather, earthquakes or other natural disasters related to global climate change, or geopolitical developments, including any potential impacts resulting from tensions between the United States and China, or logistical complications or operational disruptions arising from adverse regulatory actions, acts of war, cybersecurity incidents, public health crises or labor disruptions, we may be unable to shift production to other facilities or to make up for lost production.
For example, beginning in the back half of 2022 and continuing through 2023, demand for dispensing and closure products fell as a result of some of our larger customers' choices to rebalance on-hand inventory levels and caution in current purchasing behaviors given the current inflationary macro-economic environment.
For example, beginning in the back half of 2022 and continuing through 2023, demand for dispensing and closure products within our Packaging segment fell as a result of some of our larger customers' choices to rebalance on-hand inventory levels and caution in purchasing behaviors given the current inflationary macro-economic environment.
Furthermore, we may have little or no oversight with respect to security measures employed by third-party service providers, which may ultimately prove to be ineffective at countering threats.
Furthermore, we may have little or no oversight with respect to security measures employed by third-party service providers, which may ultimately prove to be ineffective at countering cybersecurity threats or cybersecurity incidents.
Because of the significance of our goodwill and intangible assets, and based on the magnitude of historical impairment charges, any future impairment of these assets could have a material adverse effect on our financial results. Our business may be exposed to risks associated with an increasingly concentrated customer base.
Because of the significance of our goodwill and intangible assets, and based on the magnitude of historical impairment charges, any future impairment of these assets could have a material adverse effect on our financial results. 17 Table of Contents Our business may be exposed to risks associated with an increasingly concentrated customer base.
Regulatory, Legal and Environmental Risks Significant developments from the recent and potential changes in U.S. trade policies could have a material adverse effect on us and our financial condition and results of operations. Free trade laws and regulations provide certain duties and tariffs on qualifying imports and exports, subject to compliance with the applicable classification and other requirements.
Regulatory, Legal and Environmental Risks Significant developments in U.S. trade policies could have a material adverse effect on us and our financial condition and results of operations. Free trade laws and regulations provide certain duties and tariffs on qualifying imports and exports, subject to compliance with the applicable classification and other requirements.
The majority of our leases are categorized as operating leases and are not considered indebtedness for purposes of our debt instruments. 23 Table of Contents Human Capital Risks We depend on the services of key individuals and relationships, the loss of which could materially harm us.
The majority of our leases are categorized as operating leases and are not considered indebtedness for purposes of our debt instruments. Human Capital Risks We depend on the services of key individuals and relationships, the loss of which could materially harm us.
For example, a number of our consumer packaged goods customers ordered higher levels of inventory due to concerns over capacity constraints and rising inflation in the first half of 2022, and subsequently reduced their order levels in the back-half of 2022.
Further, a number of our consumer packaged goods customers ordered higher levels of inventory due to concerns over capacity constraints and rising inflation in the first half of 2022, and subsequently reduced their order levels in the back-half of 2022.
Such interest rates are subject to benchmark interest rates based on the currency denomination of borrowings, with British pound sterling borrowings subject to the Sterling Overnight Index Average and Euro borrowings subject to the Euro InterBank Offered Rate, both plus a spread of 1.625%, and U.S. dollar borrowings subject to the Secured Overnight Financing Rate plus a spread of 1.725%.
Such interest rates are subject to benchmark interest rates based on the currency denomination of borrowings, with British pound sterling borrowings subject to the Sterling Overnight Index Average and Euro borrowings subject to the Euro InterBank Offered Rate, both plus a spread of 1.750%, and U.S. dollar borrowings subject to the Secured Overnight Financing Rate plus a spread of 1.850%.
We have significant operating and finance lease obligations and our failure to meet those obligations could adversely affect our financial condition. We lease many of our manufacturing and distribution branch facilities, and certain capital equipment. Our rental expense in 2023 under these leases was $14.9 million.
We have significant operating and finance lease obligations and our failure to meet those obligations could adversely affect our financial condition. We lease many of our manufacturing and distribution branch facilities, and certain capital equipment. Our rental expense in 2024 under these leases was $13.9 million.
We had no amounts outstanding under our revolving credit facility as of December 31, 2023. 22 Table of Contents Our degree of leverage and level of interest expense may have important consequences, including: • Should our leverage increase, it may place us at a competitive disadvantage as compared with our less leveraged competitors and make us more vulnerable in the event of a downturn in general economic conditions or in any of our businesses; • Our flexibility in planning for, or reacting to, changes in our businesses and the industries in which we operate may be limited; • A substantial portion of our cash flow from operations will be dedicated to the payment of annual interest and future principal obligations on our indebtedness, thereby reducing the funds available to us for operations, capital expenditures, acquisitions, future business opportunities or obligations to pay rent in respect of our operating leases; and • Our operations are restricted by our debt instruments, which contain certain financial and operating covenants, and those restrictions may limit, among other things, our ability to borrow money in the future for working capital, capital expenditures, acquisitions, rent expense or other purposes.
Our degree of leverage and level of interest expense may have important consequences, including: • Should our leverage increase, it may place us at a competitive disadvantage as compared with our less leveraged competitors and make us more vulnerable in the event of a downturn in general economic conditions or in any of our businesses; • Our flexibility in planning for, or reacting to, changes in our businesses and the industries in which we operate may be limited; • A substantial portion of our cash flow from operations will be dedicated to the payment of annual interest and future principal obligations on our indebtedness, thereby reducing the funds available to us for operations, capital expenditures, acquisitions, future business opportunities or obligations to pay rent in respect of our operating leases; and • Our operations are restricted by our debt instruments, which contain certain financial and operating covenants, and those restrictions may limit, among other things, our ability to borrow money in the future for working capital, capital expenditures, acquisitions, rent expense or other purposes.
As of December 31, 2023, we have one facility, located in Commerce, California, where our hourly employees operate under a collective bargaining agreement, and which represents 12% of our employees located in the United States.
As of December 31, 2024, we have one facility, located in Commerce, California, where our hourly employees operate under a collective bargaining agreement, and which represents 13% of our employees located in the United States.
While we strive to maintain high standards, our internal controls and compliance systems may not always protect us from acts committed by our employees, agents, or business partners that would violate U.S. and/or non-U.S. laws or adequately protect our confidential information, including the laws governing payments to government officials, bribery, fraud, anti-kickback and false claims rules, competition, export and import compliance, money laundering, and data privacy laws, as well as the improper use of proprietary information or social media.
While we strive to maintain high standards, our internal controls and compliance systems may not always protect us from acts committed by our employees, agents, or business partners that would violate U.S. and/or non-U.S. laws or adequately protect our confidential information, including the laws governing payments to government officials, bribery, fraud, anti-kickback and false claims rules, competition, export and import compliance, money laundering, and data privacy laws (including with respect to the European Union’s General Data Protection Regulation and U.S. state privacy laws such as the California Consumer Privacy Act), as well as the improper use of proprietary information or social media.
A major failure of our information systems could harm our business; increased IT security threats and more sophisticated and targeted computer crime could pose a risk to our systems, networks and products. We depend on integrated information systems to conduct our business.
A major failure of our information systems could harm our business; increased cybersecurity threats and more sophisticated and targeted cybersecurity attacks could pose a risk to our systems, networks and products. We depend on integrated information systems to conduct our business.
Our ability to precisely forecast the level of our customers’ orders is limited and can result in inefficiencies in scheduling our installed manufacturing capacity and result in sub-optimal business and financial results. Many of the markets we serve are highly competitive, which could limit sales volumes and reduce our operating margins. Many of our products are sold in competitive markets.
These are a few recent examples indicating that our ability to accurately forecast the level of our customers’ orders is limited and can result in inefficiencies in scheduling our installed manufacturing capacity and result in sub-optimal business and financial results. Many of the markets we serve are highly competitive, which could limit sales volumes and reduce our operating margins.
Of our net sales for the year ended December 31, 2023, 23.8% were derived from sales by our subsidiaries located outside of the U.S. In addition, we may expand our international operations through internal growth or acquisitions.
Of our net sales for the year ended December 31, 2024, 25.1% were derived from sales by our subsidiaries located outside of the United States. In addition, we may expand our international operations through internal growth or acquisitions.
The United States government has indicated its intent to alter its approach to international trade policy and in some cases to renegotiate, or potentially terminate, certain existing bilateral or multi-lateral trade agreements and treaties with foreign countries. For example, the U.S. government has implemented additional tariffs on certain goods imported from China.
The United States government has indicated its intent to alter its approach to international trade policy and in some cases to renegotiate, or potentially terminate, certain existing bilateral or multi-lateral trade agreements and treaties with foreign countries.
We have significant goodwill and intangible assets, and future impairment of our goodwill and intangible assets could have a material negative impact on our financial results. At December 31, 2023, our goodwill and intangible assets were $544.8 million and represented 40.6% of our total assets.
We have significant goodwill and intangible assets, and future impairment of our goodwill and intangible assets could have a material negative impact on our financial results. At December 31, 2024, our goodwill and intangible assets were $517.4 million and represented 39.1% of our total assets.
Any such allegations, violations of law or improper actions could subject us to civil or criminal investigations in the U.S. and in other jurisdictions, could lead to substantial civil or criminal, monetary and non-monetary penalties, and related shareholder lawsuits, could lead to increased costs of compliance, could damage our reputation and could have a material effect on our consolidated financial statements.
Any such allegations, violations of law or improper actions could subject us to civil or criminal investigations in the U.S. and in other jurisdictions, could lead to substantial civil or criminal, monetary and non-monetary penalties, and related shareholder lawsuits, could lead to increased costs of compliance, could damage our reputation and could have a material effect on our consolidated financial statements. 22 Table of Contents Risks Related to our Debt and Other Financial Obligations We have debt principal and interest payment requirements that may restrict our future operations and impair our ability to meet our obligations.
Our reference rates under our revolving credit facility may perform differently from historical rates, which may affect our net interest expense and require changes to our future risk, pricing and hedging strategies.
Our reference rates under our revolving credit facility may perform differently from historical rates, which may affect our net interest expense and require changes to our future risk, pricing and hedging strategies. We had $1.5 million outstanding under our revolving credit facility as of December 31, 2024.
While we maintain some of our critical information systems, we are also dependent on third parties to provide important services relating to, among other things, operational technology at our facilities, human resources, electronic communications and certain finance functions. We may experience operating problems with our information systems as a result of system failures, viruses, computer hackers or other causes.
While we maintain some of our critical information systems, we are also dependent on third parties to provide important services relating to, among other things, operational technology at our facilities, human resources, electronic communications and certain finance functions.
On December 12, 2022, the European Union member states agreed to implement the OECD's Pillar Two global corporate minimum tax rate of 15% on companies with revenues of at least $790,000, which would go into effect beginning in 2024.
On December 12, 2022, the European Union member states agreed to implement the OECD's Pillar Two global corporate minimum tax rate of 15% on companies with revenues of at least $790,000, which went into effect in January 2024. A number of other countries have passed legislation enacting certain parts of the Pillar Two framework in 2024.
Additional changes in laws or policies governing the terms of foreign trade, and in particular increased trade restrictions, tariffs or taxes on imports from countries where we manufacture or purchase products could have a material adverse effect on our business and financial results.
Additional changes in laws or policies governing the terms of foreign trade, and in particular increased trade restrictions, tariffs or taxes on imports from countries where we manufacture or purchase products could have a material adverse effect on our business, financial condition and results of operations. 20 Table of Contents Compliance with and changes in tax laws, including tax reform legislation in the United States, could materially and adversely impact our financial condition, results of operations and cash flows.
Moreover, the effect of dispositions over time will reduce our cash flow and earnings capacity and result in a less diversified portfolio of businesses, creating a greater dependency on remaining businesses for our financial results. 16 Table of Contents Accordingly, risks related to strategic acquisitions or dispositions may result in the disruption of our ongoing business, diversion of management's attention, the failure of such transactions to be completed, or the failure to realize the financial and strategic benefits contemplated at the time of a transaction, some or all of which could materially and adversely affect our business strategy, financial condition and results of operations.
Accordingly, risks related to strategic acquisitions or dispositions may result in the disruption of our ongoing business, diversion of management's attention, the failure of such transactions to be completed, or the failure to realize the financial and strategic benefits contemplated at the time of a transaction, some or all of which could materially and adversely affect our business strategy, financial condition and results of operations.
We believe that the principal points of competition in our markets are price, product quality, delivery performance, design and engineering capabilities, product development, conformity to customer specifications, customer service and effectiveness of distribution. Maintaining and improving our competitive position will require continued investment by us in manufacturing, engineering, quality standards, marketing, customer service and support of our distribution networks.
Many of our products are sold in competitive markets. We believe that the principal points of competition in our markets are price, product quality, delivery performance, design and engineering capabilities, product development, conformity to customer specifications, customer service and effectiveness of distribution.
All relief sought in the asbestos cases is monetary in nature. To date, approximately 40% of our costs related to settlement and defense of asbestos litigation have been covered by our primary insurance.
Total settlement costs (exclusive of defense costs) for all such cases, some of which were filed more than 30 years ago, have been $13.7 million. All relief sought in the asbestos cases is monetary in nature. To date, approximately 40% of our costs related to settlement and defense of asbestos litigation have been covered by our primary insurance.
We continue to monitor and evaluate legislative developments related to the Global Anti-Base Erosion Proposal ("GloBE") established by the Organization of Economic Cooperation and Development's ("OECD") Pillar Two framework.
We continue to monitor and evaluate legislative developments related to the Global Anti-Base Erosion Proposal ("GloBE") established by the Organization of Economic Cooperation and Development's ("OECD") Pillar Two framework. OECD member countries may implement the Pillar Two model rules as issued, in a modified form, or not at all.
In addition, our former Lamons business is a party to lawsuits related to asbestos contained in gaskets formerly manufactured by it or its predecessors. While we sold the Lamons business in December 2019, we retained the asbestos-related liability exposure. Some of this litigation includes claims for punitive and consequential, as well as compensatory damages.
While we sold the Lamons business in December 2019, we retained the asbestos-related liability exposure. Some of this litigation includes claims for punitive and consequential, as well as compensatory damages.
For example, in a prior period, a large commercial aircraft manufacturer announced significant production delays and/or reductions on certain of its platforms for which we provide products, which significantly impacted our sales, profit and production efficiencies compared to historical levels. 17 Table of Contents The mix and type of customers, and sales to any single customer, may vary significantly from quarter to quarter and from year to year, and have a significant impact on our financial condition, results of operations and cash flows.
For example, in a prior period, a large commercial aircraft manufacturer announced significant production delays and/or reductions on certain of its platforms for which we provide products, which significantly impacted our sales, profit and production efficiencies compared to historical levels.
However, the nature of our operations and our long history of industrial activities at certain of our current or former facilities, as well as those acquired, could potentially result in material liabilities.
Other environmental laws and regulations require obtaining and complying with environmental permits. To date, costs of complying with environmental, health and safety requirements have not been material. However, the nature of our operations and our long history of industrial activities at certain of our current or former facilities, as well as those acquired, could potentially result in material liabilities.
Such breaches would permit the lenders to declare all amounts borrowed thereunder to be due and payable, and the commitments of such lenders to make further extensions of credit could be terminated. Each of these circumstances could materially and adversely impair our liquidity. Our borrowing costs may be impacted by our credit ratings developed by various rating agencies.
Such breaches would permit the lenders to declare all amounts borrowed thereunder to be due and payable, and the commitments of such lenders to make further extensions of credit could be terminated.
We may have insufficient resources in the future to continue to make such investments and, even if we make such investments, we may not be able to maintain or improve our competitive position.
Maintaining and improving our competitive position will require continued investment by us in manufacturing, engineering, quality standards, marketing, customer service and support of our distribution networks. We may have insufficient resources in the future to continue to make such investments and, even if we make such investments, we may not be able to maintain or improve our competitive position.
We may be subject to claims or inquiries regarding alleged unauthorized use of a third party’s intellectual property.
We may face liability associated with the use of products for which patent ownership or other intellectual property rights are claimed. We may be subject to claims or inquiries regarding alleged unauthorized use of a third party’s intellectual property.
In addition, warranty claims are generally not covered by our product liability insurance. Further, any product liability or warranty issues may adversely affect our reputation as a manufacturer of high-quality, safe products, divert management’s attention, and could have a material adverse effect on our business.
Further, any product liability or warranty issues may adversely affect our reputation as a manufacturer of high-quality, safe products, divert management’s attention, and could have a material adverse effect on our business. 21 Table of Contents In addition, our former Lamons business is a named party to lawsuits related to asbestos contained in gaskets alleged to be formerly manufactured by it or its predecessors.
Many tax liabilities are subject to periodic audits by taxing authorities, and such audits could subject us to additional tax as well as interest and penalties.
We are subject to extensive tax liabilities, including federal, state and foreign income taxes and transactional taxes such as excise, sales and use, payroll, franchise, withholding and property taxes. Many tax liabilities are subject to periodic audits by taxing authorities, and such audits could subject us to additional tax as well as interest and penalties.
Many governments, regulators, investors, employees, customers and other stakeholders are increasingly focused on sustainability and ESG considerations relating to businesses.
Many governments, regulators, investors, employees, customers and other stakeholders are increasingly focused on sustainability and ESG considerations relating to businesses. We have announced certain areas of focus through information on our website, press statements and other communications, including through our Sustainability Reports.
Two major ratings agencies, Standard & Poor's and Moody's, evaluate our credit profile on an ongoing basis and have each assigned ratings for our long-term debt.
Each of these circumstances could materially and adversely impair our liquidity. 23 Table of Contents Our borrowing costs may be impacted by our credit ratings developed by various rating agencies. Two major ratings agencies, Standard & Poor's and Moody's, evaluate our credit profile on an ongoing basis and have each assigned ratings for our long-term debt.
We may encounter various risks in pursuing such strategic transactions, including the possible inability to integrate an acquired business into our operations, increased expenses, increased debt obligations to finance such strategic transactions and unanticipated problems or liabilities.
We may encounter various risks in pursuing such strategic transactions, including the possible inability to integrate an acquired business into our operations, increased expenses, increased debt obligations to finance such strategic transactions and unanticipated problems or liabilities. 16 Table of Contents In addition, we may dispose of assets or businesses at a price or on terms that are less favorable than we had anticipated, or with the exclusion of assets that must be divested or run off separately.
Increased global IT security threats and more sophisticated and targeted computer crime pose a risk to the security of our systems and networks, and the confidentiality, availability and integrity of our data and communications.
Increased global IT security threats and more sophisticated and targeted cybersecurity attacks, including the rapid evolution and increased availability of artificial intelligence technologies that may intensify cybersecurity risks by making cybersecurity incidents more difficult to detect, contain and mitigate, pose a risk to the security of our systems and networks, and the confidentiality, availability and integrity of our data and communications.
We also may be required to incur additional defense costs and pay damage awards or settlements, or become subject to equitable remedies, in the future that could adversely affect our businesses. Our business may be materially and adversely affected by compliance obligations and liabilities under environmental laws and regulations, including related to climate change.
In the event the asbestos defense costs and indemnity insurance coverage provided by the coverage-in-place agreement are unavailable to us for any reason, we may incur additional costs. We also may be required to incur additional defense costs and pay damage awards or settlements, or become subject to equitable remedies, in the future that could adversely affect our businesses.
Any significant disruption or slowdown of our systems could cause customers to cancel orders or cause standard business processes to become inefficient or ineffective. 18 Table of Contents We have experienced cyber-attacks in the past and, while none of these cyber-attacks resulted in a material disruption to our business, we may experience additional cyber-attacks in the future.
We have experienced cybersecurity incidents in the past and, while none of these cybersecurity incidents resulted in a material disruption to our business, we may experience additional cybersecurity incidents in the future.
We have four facilities outside of the United States where our employees are affiliated with state-controlled or trade unions, which covers 21% of our non-U.S. employees. In 2021 we entered a three-year collective bargaining agreement with the United Automobile, Aerospace and Agricultural Implement Workers of America at our TriMas Aerospace facility in Commerce, California, which expires in August 2024.
Our labor agreement with the United Automobile, Aerospace and Agricultural Implement Workers of America (UAW) at our TriMas Aerospace facility in Commerce, California, expired in August 2024, at which time the UAW initiated a strike. We entered into a new three-year collective bargaining agreement in October 2024.
Risks Related to our Debt and Other Financial Obligations We have debt principal and interest payment requirements that may restrict our future operations and impair our ability to meet our obligations. As of December 31, 2023, we have $395.7 million of outstanding long-term debt. We are subject to variable interest rates on our revolving credit facility.
As of December 31, 2024, we have $398.1 million of outstanding long-term debt. We are subject to variable interest rates on our revolving credit facility.
We are subject to increasingly stringent environmental laws and regulations, including those relating to air emissions, wastewater discharges and chemical and hazardous waste management and disposal. A number of governments or governmental bodies have introduced or are contemplating introducing regulatory changes in response to climate change, including regulating greenhouse gas emissions.
A number of governments or governmental bodies have introduced or are contemplating introducing regulatory changes in response to climate change, including regulating greenhouse gas emissions. Some of these laws hold owners or operators of land or businesses liable for their own and for previous owners' or operators' releases of hazardous or toxic substances or wastes.
Of the 4,863 claims pending at December 31, 2023, 33 set forth specific amounts of damages (other than those stating the statutory minimum or maximum).
Of the 4,968 claims pending at December 31, 2024, 28 set forth specific amounts of damages (other than those stating the statutory minimum or maximum). See Note 15, " Commitments and Contingencies ," included in Item 8, " Financial Statements and Supplementary Data ," within this Form 10-K for additional information.
For 2023, material and other input costs have decreased from 2022 levels, primarily in our Packaging segment, although pressure on wage rates remain.
For 2024, while our material and other input costs have generally stabilized compared to 2023 levels, we have experienced increased input costs associated with abrupt increases in customer demand, primarily in our Packaging segment. Pressure on wage rates continued through 2024 across all our businesses.
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In addition, we may dispose of assets or businesses at a price or on terms that are less favorable than we had anticipated, or with the exclusion of assets that must be divested or run off separately.
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As a more recent example, we experienced strong demand and inventory builds from customers, which benefited our steel cylinder business in 2022 and 2023, which then resulted in customer destocking negatively impacting demand for steel cylinders in 2024.
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We have announced certain areas of focus through information on our website, press statements and other communications, including through our Sustainability Reports, which include health and safety, environmental matters, climate change and greenhouse gas emissions, human capital, diversity, equity and inclusion, talent development, and innovation for sustainable products.
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Moreover, the effect of dispositions over time will reduce our cash flow and earnings capacity and result in a less diversified portfolio of businesses, creating a greater dependency on remaining businesses for our financial results.
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Compliance with and changes in tax laws, including tax reform legislation in the United States, could materially and adversely impact our financial condition, results of operations and cash flows. We are subject to extensive tax liabilities, including federal, state and foreign income taxes and transactional taxes such as excise, sales and use, payroll, franchise, withholding and property taxes.
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The mix and type of customers, and sales to any single customer, may vary significantly from quarter to quarter and from year to year, and have a significant impact on our financial condition, results of operations and cash flows.
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While we will continue to analyze this law to determine potential impacts, at this time, we do not expect the Pillar Two legislation to have a material impact on our consolidated financial statements. 20 Table of Contents We may face liability associated with the use of products for which patent ownership or other intellectual property rights are claimed.
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For example, beginning late 2023 and continuing through 2024, we experienced a significant demand trough in our cylinder business as our customers rebalanced their inventory and adjusted their buying patterns.
Removed
See Note 15, " Commitments and Contingencies ," included in Item 8, " Financial Statements and Supplementary Data ," within this Form 10-K for additional information. 21 Table of Contents Total settlement costs (exclusive of defense costs) for all such cases, some of which were filed more than 30 years ago, have been $13.1 million.
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We may experience operating problems with our information systems as a result of system failures, cybersecurity incidents or other causes. 18 Table of Contents Cybersecurity incidents and similar attacks vary in their form and can include the deployment of harmful malware or ransomware, denial-of-service attacks, and other attacks, which may affect business continuity and threaten the availability, confidentiality and integrity of our systems and information.
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Some of these laws hold owners or operators of land or businesses liable for their own and for previous owners' or operators' releases of hazardous or toxic substances or wastes. Other environmental laws and regulations require obtaining and complying with environmental permits. To date, costs of complying with environmental, health and safety requirements have not been material.
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Cybersecurity incidents can also include employee or personnel failures, fraud, phishing or other social engineering attempts or other methods to cause confidential information, payments, account access or access credentials, or other data to be transmitted to an unintended recipient.
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Cybersecurity threat actors also may attempt to exploit vulnerabilities in software that is commonly used by companies in cloud-based services and bundled software. Any significant disruption or slowdown of our systems could cause customers to cancel orders or cause standard business processes to become inefficient or ineffective.
Added
Further, there can be no assurance that a future cybersecurity incident will not result in a material disruption to our business or have a material adverse effect on our business strategy, results of operations or financial condition.
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Retaliatory tariffs imposed by other countries or other potential governmental actions, could result in further adverse impacts on our business and results of operations.
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The degree to which these changes in U.S. trade policies, or the trade policies of other counties, affect our financial condition and results of operations will be influenced by the specific details of the changes in trade policies, their timing and duration, and our effectiveness in deploying tools and strategies to address these issues.
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While the Pillar Two legislation did not have a material impact on our 2024 consolidated financial statements, it could have a material impact on our effective tax rate and result in higher cash tax liabilities in the future, depending on which countries enact minimum tax legislation and in what manner.
Added
In addition, warranty claims are generally not covered by our product liability insurance.
Added
Our business may be materially and adversely affected by compliance obligations and liabilities under environmental laws and regulations, including related to climate change. We are subject to increasingly stringent environmental laws and regulations, including those relating to air emissions, wastewater discharges and chemical and hazardous waste management and disposal.
Added
We have six facilities outside of the United States where our employees are affiliated with state-controlled or trade unions, which covers 13% of our non-U.S. employees.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeHowever, we may have little or no oversight with respect to security measures employed by third-party service providers, which may ultimately prove to be ineffective at countering cybersecurity threats. We have experienced cyber-attacks in the past and, while none of these cyber-attacks resulted in a material disruption to our business, we may experience additional cyber-attacks in the future.
Biggest changeHowever, we may have little or no oversight with respect to security measures employed by third-party service providers, which may ultimately prove to be ineffective at countering cybersecurity threats.
Governance The Board of Directors of the Company (the "Board") is presented with a cybersecurity update quarterly and is integrated within our TriMas Incident Response Plan. The Board reviews the Company's ERM process, including the design of the program, the key risks identified and the actions identified to manage and reduce those risks.
Governance The Board of Directors of the Company (the "Board") is presented with a cybersecurity update quarterly which is integrated within our TriMas Incident Response Plan. The Board reviews the Company's ERM process, including the design of the program, the key risks identified and the actions identified to manage and reduce those risks.
For additional information, refer to "Risks Relating to Our Business – A major failure of our information systems could harm our business; increased IT security threats and more sophisticated and targeted computer crime could pose a risk to our systems, networks and products. " in " Item 1A. Risk Factors within this Form 10-K.
For additional information, refer to "Risks Relating to Our Business – A major failure of our information systems could harm our business; increased cybersecurity threats and more sophisticated and targeted cybersecurity attacks could pose a risk to our systems, networks and products. " in " Item 1A. Risk Factors" within this Form 10-K.
As of the filing of this Form 10-K, we are not aware of any such attacks that have occurred since the beginning of 2023 that have materially affected, or are reasonably likely to materially affect us, including our business strategy, results of operations or financial condition.
As of the filing of this Form 10-K, we do not believe that any risks from cybersecurity threats, including as a result of any previous cybersecurity incidents, have materially affected, or are reasonably likely to materially affect us, including our business strategy, results of operations or financial condition.
Added
We have experienced cybersecurity incidents in the past and, while none of these cybersecurity incidents resulted in a material disruption to our business, we may experience additional cybersecurity incidents in the future.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe following list sets forth the location of our principal owned and leased manufacturing and other facilities used in continuing operations and identifies the principal segment utilizing such facilities as of December 31, 2023: Packaging Aerospace Specialty Products United States: Alabama Huntsville Arkansas Atkins (1) Arizona Mesa Tolleson California Irwindale (1) City of Industry Commerce (1) Simi Valley (1) El Cajon Colorado Denver (1) Illinois Woodridge (1) Indiana Auburn Hamilton (1) Indianapolis (1) Kansas Ottawa Michigan Clinton Township (1) Ohio New Albany (1) Oklahoma Tulsa Texas Longview International: Brazil Sao Paulo (1) Canada Orangeville (1) China Haining City (1) Germany Neunkirchen India Baddi New Delhi (1) Italy Borgo San Giovanni (1) Forli Pieve Fissiraga (1) Povolaro Mexico San Miguel de Allende (1) Netherlands Waalwijk (1) Slovakia Levice (1) United Kingdom Leicester Vietnam Thu Dau Mot (1) ______________________ (1) Represents a leased facility.
Biggest changeThe following list sets forth the location of our principal owned and leased manufacturing and other facilities used in continuing operations and identifies the principal segment utilizing such facilities as of December 31, 2024: Packaging Aerospace Specialty Products United States: Alabama Huntsville Arkansas Atkins (1) Arizona Mesa Tolleson California City of Industry Commerce (1) Simi Valley (1) El Cajon Colorado Denver (1) Illinois Woodridge (1) Indiana Auburn Hamilton (1) Indianapolis (1) Kansas Ottawa Michigan Clinton Township (1) Ohio New Albany (1) Oklahoma Tulsa Texas Longview International: Brazil Sao Paulo (1) Canada Orangeville (1) China Haining City (1) Germany Neunkirchen India Baddi New Delhi (1) Italy Borgo San Giovanni (1) Forli Pieve Fissiraga (1) Povolaro Mexico San Miguel de Allende (1) Netherlands Waalwijk (1) Slovakia Levice (1) United Kingdom Leicester Vietnam Thu Dau Mot (1) ______________________ (1) Represents a leased facility.
The leases for our manufacturing facilities have terms that expire from 2024 through 2032 and are generally renewable, at our option, for various terms, provided that we are not in default under the lease agreements. Substantially all of our owned U.S. real properties are subject to liens in connection with our credit facility.
The leases for our manufacturing facilities have terms that expire from 2025 through 2033 and are generally renewable, at our option, for various terms, provided that we are not in default under the lease agreements. Substantially all of our owned U.S. real properties are subject to liens in connection with our credit facility.
TriMas' corporate executive office is located in Bloomfield Hills, Michigan, which is leased through February 2028. Our buildings have been generally well maintained, are in good operating condition and are adequate for current production requirements.
TriMas' corporate executive office is located in Bloomfield Hills, Michigan, which is leased through June 2033. Our buildings have been generally well maintained, are in good operating condition and are adequate for current production requirements.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeItem 4. Mine Safety Disclosures Not applicable. Supplementary Item. Information about our Executive Officers As of December 31, 2023, the following were executive officers of the Company: Thomas A. Amato. Mr. Amato, age 60, was appointed the Company's President and Chief Executive Officer in July 2016.
Biggest changeItem 4. Mine Safety Disclosures Not applicable. Supplementary Item. Information about our Executive Officers As of December 31, 2024, the following were executive officers of the Company: Thomas A. Amato. Mr. Amato, age 61, was appointed the Company's President and Chief Executive Officer in July 2016.
Mell’s previous experience also includes serving in multiple C-Suite roles for both public and privately-held companies in the industrial manufacturing, aerospace and energy industries. Jill S. Stress. Ms. Stress, age 46, was appointed the Company's Chief Human Resources Officer in April 2023. Ms. Stress joined the Company in 2009 and was formerly the Company's Director of Compensation and Benefits.
Mell’s previous experience also includes serving in multiple C-Suite roles for both public and privately-held companies in the industrial manufacturing, aerospace and energy industries. Jill S. Stress. Ms. Stress, age 47, was appointed the Company's Chief Human Resources Officer in April 2023. Ms. Stress joined the Company in 2009 and was formerly the Company's Director of Compensation and Benefits.
Amato also serves on the Board of Directors of Ametek, a publicly-traded diversified industrial manufacturing company, and is appointed as its Compensation Committee Chair. Scott A. Mell. Mr. Mell, age 52, was appointed the Company's Chief Financial Officer in May 2021. Prior to joining the Company, Mr.
Amato also serves on the Board of Directors of Ametek, a publicly-traded diversified industrial manufacturing company, and is appointed as its Compensation Committee Chair. Scott A. Mell. Mr. Mell, age 53, was appointed the Company's Chief Financial Officer in May 2021. Prior to joining the Company, Mr.
Prior to joining the Company, Ms. Stress was the Manager of Benefits, Compensation and Human Resources Systems at Behr America. Jodi F. Robin. Ms. Robin, age 43, was appointed the Company's General Counsel and Secretary in April 2021. Ms. Robin joined the Company in 2010 as Associate General Counsel and was promoted to Deputy General Counsel in 2014.
Prior to joining the Company, Ms. Stress was the Manager of Benefits, Compensation and Human Resources Systems at Behr America. Jodi F. Robin. Ms. Robin, age 44, was appointed the Company's General Counsel and Secretary in April 2021. Ms. Robin joined the Company in 2010 as Associate General Counsel and was promoted to Deputy General Counsel in 2014.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe graph assumes that $100 was invested on December 31, 2018 in each of TriMas common stock, the stocks comprising the Russell 2000 Index and the stocks comprising the S&P SmallCap 600 Capped Industrials Index. 29 Table of Contents Issuer Purchases of Equity Securities The following table provides information about purchases made by the Company, or on behalf of the Company by an affiliated purchaser, of shares of the Company's common stock during the three months ended December 31, 2023.
Biggest changeThe graph assumes that $100 was invested on December 31, 2019, in each of TriMas common stock, the stocks comprising the Russell 2000 Index and the stocks comprising the S&P SmallCap 600 Capped Industrials Index. 29 Table of Contents Issuer Purchases of Equity Securities There were no purchases made by the Company, or on behalf of the Company by an affiliated purchaser, of shares of the Company's common stock during the three months ended December 31, 2024.
In 2021, our Board of Directors declared the first dividend since our initial public offering in 2007. Since the fourth quarter of 2021, we have declared dividends of $0.04 per share of common stock each quarter, and total dividends declared and paid on common shares during 2023, 2022 and 2021 were $6.7 million, $6.9 million and $1.7 million, respectively.
In 2021, our Board of Directors declared the first dividend since our initial public offering in 2007. Since the fourth quarter of 2021, we have declared dividends of $0.04 per share of common stock each quarter, and total dividends declared and paid on common shares during 2024, 2023 and 2022 were $6.6 million, $6.7 million and $6.9 million, respectively.
Performance Graph The following graph compares the cumulative total stockholder return from December 31, 2018 through December 31, 2023 for TriMas common stock, the Russell 2000 Index and the S&P SmallCap 600 Capped Industrials Index. We have assumed that dividends have been reinvested and returns have been weighted-averaged based on market capitalization.
Performance Graph The following graph compares the cumulative total stockholder return from December 31, 2019 through December 31, 2024 for TriMas common stock, the Russell 2000 Index and the S&P SmallCap 600 Capped Industrials Index. We have assumed that dividends have been reinvested and returns have been weighted-averaged based on market capitalization.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock, par value $0.01 per share, is listed for trading on the NASDAQ Global Select Market under the symbol "TRS." As of February 22, 2024, there were 138 holders of record of our common stock.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock, par value $0.01 per share, is listed for trading on the NASDAQ Global Select Market under the symbol "TRS." As of February 20, 2025, there were 136 holders of record of our common stock.
Removed
Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program (in millions) (1) October 1, 2023 to October 31, 2023 37,675 $ 23.70 37,675 $ 91.5 November 1, 2023 to November 30, 2023 116,201 $ 24.50 116,201 $ 88.6 December 1, 2023 to December 31, 2023 64,330 $ 26.17 64,330 $ 86.9 Total 218,206 $ 24.86 218,206 $ 86.9 __________________________ (1) In March 2020, the Company announced its Board of Directors had authorized the Company to increase the purchase of its common stock up to $250 million in the aggregate from its previous authorization of $150 million.
Added
In March 2020, the Board of Directors increased the authorization of share repurchases to a cumulative amount of $250 million. As of December 31, 2024, the Company had approximately $67.6 million remaining under the repurchase authorization.
Removed
The increased authorization includes the value of shares already purchased under the previous authorization. Pursuant to this share repurchase program, during the three months ended December 31, 2023, the Company repurchased 218,206 shares of its common stock at a cost of $5.4 million. The share repurchase program is effective and has no expiration date.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeWe will continue to evaluate opportunities to return capital to shareholders through the purchase of our common stock, as well as dividends, depending on market conditions and other factors. 33 Table of Contents Segment Information and Supplemental Analysis The following table summarizes financial information for our three reportable segments (dollars in thousands): Year ended December 31, 2023 As a Percentage of Net Sales 2022 As a Percentage of Net Sales 2021 As a Percentage of Net Sales Net Sales Packaging $ 463,600 51.9 % $ 522,180 59.1 % $ 533,260 62.2 % Aerospace 241,400 27.0 % 188,090 21.3 % 183,340 21.4 % Specialty Products 188,550 21.1 % 173,560 19.6 % 140,510 16.4 % Total $ 893,550 100.0 % $ 883,830 100.0 % $ 857,110 100.0 % Gross Profit Packaging $ 109,050 23.5 % $ 137,030 26.2 % $ 145,750 27.3 % Aerospace 48,010 19.9 % 32,240 17.1 % 39,970 21.8 % Specialty Products 44,260 23.5 % 39,030 22.5 % 31,470 22.4 % Total $ 201,320 22.5 % $ 208,300 23.6 % $ 217,190 25.3 % Selling, General and Administrative Packaging $ 48,760 10.5 % $ 55,670 10.7 % $ 49,110 9.2 % Aerospace 31,370 13.0 % 28,990 15.4 % 26,690 14.6 % Specialty Products 7,830 4.2 % 8,680 5.0 % 8,950 6.4 % Corporate expenses 46,620 N/A 37,850 N/A 37,220 N/A Total $ 134,580 15.1 % $ 131,190 14.8 % $ 121,970 14.2 % Operating Profit (Loss) Packaging $ 60,140 13.0 % $ 81,000 15.5 % $ 96,490 18.1 % Aerospace 15,520 6.4 % 8,060 4.3 % 13,270 7.2 % Specialty Products 36,400 19.3 % 30,250 17.4 % 22,550 16.0 % Corporate (46,620) N/A (20,250) N/A (37,220) N/A Total $ 65,440 7.3 % $ 99,060 11.2 % $ 95,090 11.1 % Capital Expenditures Packaging $ 29,060 6.3 % $ 33,170 6.4 % $ 34,080 6.4 % Aerospace 14,620 6.1 % 6,900 3.7 % 5,390 2.9 % Specialty Products 10,410 5.5 % 5,860 3.4 % 5,500 3.9 % Corporate 100 N/A 30 N/A 90 N/A Total $ 54,190 6.1 % $ 45,960 5.2 % $ 45,060 5.3 % Depreciation Packaging $ 27,740 6.0 % $ 22,720 4.4 % $ 20,950 3.9 % Aerospace 7,820 3.2 % 7,590 4.0 % 7,140 3.9 % Specialty Products 3,720 2.0 % 3,680 2.1 % 3,670 2.6 % Corporate 130 N/A 130 N/A 130 N/A Total $ 39,410 4.4 % $ 34,120 3.9 % $ 31,890 3.7 % Amortization Packaging $ 6,430 1.4 % $ 6,620 1.3 % $ 9,550 1.8 % Aerospace 11,340 4.7 % 12,030 6.4 % 11,560 6.3 % Specialty Products 410 0.2 % 450 0.3 % 450 0.3 % Corporate — N/A — N/A — N/A Total $ 18,180 2.0 % $ 19,100 2.2 % $ 21,560 2.5 % 34 Table of Contents The following "Results of Operations Year Ended December 31, 2023 Compared with Year Ended December 31, 2022" section presents an analysis of our consolidated operating results displayed in the Consolidated Statement of Income.
Biggest changeWe will continue to evaluate opportunities to return capital to shareholders through the purchase of our common stock, as well as dividends, depending on market conditions and other factors. 33 Table of Contents Segment Information and Supplemental Analysis The following table summarizes financial information for our three reportable segments (dollars in thousands): Year ended December 31, 2024 As a Percentage of Net Sales 2023 As a Percentage of Net Sales 2022 As a Percentage of Net Sales Net Sales Packaging $ 512,320 55.4 % $ 463,600 51.9 % $ 522,180 59.1 % Aerospace 294,210 31.8 % 241,400 27.0 % 188,090 21.3 % Specialty Products 118,480 12.8 % 188,550 21.1 % 173,560 19.6 % Total $ 925,010 100.0 % $ 893,550 100.0 % $ 883,830 100.0 % Gross Profit Packaging $ 123,650 24.1 % $ 109,050 23.5 % $ 137,030 26.2 % Aerospace 69,920 23.8 % 48,010 19.9 % 32,240 17.1 % Specialty Products 5,890 5.0 % 44,260 23.5 % 39,030 22.5 % Total $ 199,460 21.6 % $ 201,320 22.5 % $ 208,300 23.6 % Selling, General and Administrative Packaging $ 56,420 11.0 % $ 48,760 10.5 % $ 55,670 10.7 % Aerospace 36,150 12.3 % 31,370 13.0 % 28,990 15.4 % Specialty Products 7,790 6.6 % 7,830 4.2 % 8,680 5.0 % Corporate expenses 52,680 N/A 46,620 N/A 37,850 N/A Total $ 153,040 16.5 % $ 134,580 15.1 % $ 131,190 14.8 % Operating Profit (Loss) Packaging $ 68,110 13.3 % $ 60,140 13.0 % $ 81,000 15.5 % Aerospace 33,750 11.5 % 15,520 6.4 % 8,060 4.3 % Specialty Products (1,990) (1.7) % 36,400 19.3 % 30,250 17.4 % Corporate (52,680) N/A (46,620) N/A (20,250) N/A Total $ 47,190 5.1 % $ 65,440 7.3 % $ 99,060 11.2 % Capital Expenditures Packaging $ 30,860 6.0 % $ 29,060 6.3 % $ 33,170 6.4 % Aerospace 9,960 3.4 % 14,620 6.1 % 6,900 3.7 % Specialty Products 7,100 6.0 % 10,410 5.5 % 5,860 3.4 % Corporate 3,040 N/A 100 N/A 30 N/A Total $ 50,960 5.5 % $ 54,190 6.1 % $ 45,960 5.2 % Depreciation Packaging $ 27,730 5.4 % $ 27,740 6.0 % $ 22,720 4.4 % Aerospace 7,900 2.7 % 7,820 3.2 % 7,590 4.0 % Specialty Products 12,270 10.4 % 3,720 2.0 % 3,680 2.1 % Corporate 220 N/A 130 N/A 130 N/A Total $ 48,120 5.2 % $ 39,410 4.4 % $ 34,120 3.9 % Amortization Packaging $ 6,520 1.3 % $ 6,430 1.4 % $ 6,620 1.3 % Aerospace 10,280 3.5 % 11,340 4.7 % 12,030 6.4 % Specialty Products — — % 410 0.2 % 450 0.3 % Corporate — N/A — N/A — N/A Total $ 16,800 1.8 % $ 18,180 2.0 % $ 19,100 2.2 % 34 Table of Contents The following table summarizes detail on the year-over-year sales growth percentages for our reportable segments for the year ended December 31, 2024 as compared to the year ended December 31, 2023: Year to Date 2024 vs.
We recorded pre-tax realignment charges of $10.3 million in 2023, primarily related to our actions to close and consolidate two production facilities in China into one new, larger facility in Haining, China, and to close and consolidate our Rohnert Park, California, manufacturing facility operations into other existing U.S. production locations.
In 2023, we recorded pre-tax realignment charges of $10.3 million, primarily related to our actions to close and consolidate two production facilities in China into one new, larger facility in Haining, China, and to close and consolidate our Rohnert Park, California, manufacturing facility operations into other existing U.S. production locations.
We will continue to take actions to mitigate such increases, including implementing commercial pricing adjustments, holding extra inventories and resourcing to alternate suppliers and insourcing of previously sourced products.
We will continue to take actions to mitigate such increases, including implementing commercial pricing adjustments, holding extra inventories, resourcing to alternate suppliers and insourcing of previously sourced products.
Each year, as a core tenet of the TriMas Business Model, our businesses target cost savings from Kaizen and continuous improvement initiatives in an effort to reduce, or otherwise offset, the impact of increased input and conversion costs through increased throughput and yield rates, with a goal of at least covering inflationary and market cost increases.
Each year, as a core tenet of the TriMas Business Model, our businesses target cost savings from Kaizen (continuous improvement) initiatives in an effort to reduce, or otherwise offset, the impact of increased input and conversion costs through increased throughput and yield rates, with a goal of at least covering inflationary and market cost increases.
As such, an increase in crude oil often is a precursor to rising input polymeric raw material costs, for which we may experience a contractual commercial recover lag. Separately, our Arrow Engine business in our Specialty Products segment is sensitive to the demand for natural gas and crude oil in North America.
As such, an increase in crude oil often is a precursor to rising polymeric raw material costs, for which we may experience a contractual commercial recover lag. Separately, our Arrow Engine business in our Specialty Products segment is sensitive to the demand for natural gas and crude oil in North America.
The 2029 Senior Notes are pari passu in right of payment with all existing and future senior indebtedness and subordinated to all existing and future secured indebtedness to the extent of the value of the assets securing such indebtedness.
The Senior Notes are pari passu in right of payment with all existing and future senior indebtedness and subordinated to all existing and future secured indebtedness to the extent of the value of the assets securing such indebtedness.
Sales in our Packaging segment for dispensing and closure products used in applications to help fight the spread of germs have experienced extreme volatility in demand, with demand spiking to record highs after the onset of the pandemic, demand abating as expected from those high levels beginning mid-2022 and continuing through most of 2023, with demand stabilizing toward the end of 2023, as a result of some of our larger customers' choices to rebalance on-hand inventory levels and caution in purchasing behaviors given the current inflationary macro-economic environment.
Sales in our Packaging segment for dispensing and closure products used in applications to help fight the spread of germs have experienced extreme volatility in demand, with demand spiking to record highs after the onset of the pandemic, demand abating as expected from those high levels beginning mid-2022 and continuing through most of 2023, as a result of some of our larger customers' choices to rebalance on-hand inventory levels and caution in purchasing behaviors given the current inflationary macro-economic environment.
We determine our reporting units at the individual operating segment level, or one level below, when there is discrete financial information available that is regularly reviewed by segment management for evaluating operating results. For purposes of our 2023 goodwill impairment test, we had six reporting units, four of which had goodwill, within our three reportable segments.
We determine our reporting units at the individual operating segment level, or one level below, when there is discrete financial information available that is regularly reviewed by segment management for evaluating operating results. For purposes of our 2024 goodwill impairment test, we had six reporting units, four of which had goodwill, within our three reportable segments.
The following is a reconciliation of net income, as reported, which is a GAAP measure of our operating results, to Consolidated Bank EBITDA, as defined in our Credit Agreement, for the year ended December 31, 2023. We present Consolidated Bank EBITDA to show our performance under our financial covenants. Dollars are in thousands in the below tables.
The following is a reconciliation of net income, as reported, which is a GAAP measure of our operating results, to Consolidated Bank EBITDA, as defined in our Credit Agreement, for the year ended December 31, 2024. We present Consolidated Bank EBITDA to show our performance under our financial covenants. Dollars are in thousands in the below tables.
Our permitted total net leverage ratio under the Credit Agreement is 4.00 to 1.00 as of December 31, 2023. If we were to complete an acquisition which qualifies for a Covenant Holiday Period, as defined in our Credit Agreement, then our permitted total net leverage ratio cannot exceed 4.50 to 1.00 during that period.
Our permitted total net leverage ratio under the Credit Agreement is 4.00 to 1.00 as of December 31, 2024. If we were to complete an acquisition which qualifies for a Covenant Holiday Period, as defined in our Credit Agreement, then our permitted total net leverage ratio cannot exceed 4.50 to 1.00 during that period.
These include payments under our long-term debt agreements, rent payments required under operating and finance lease agreements, certain benefit obligations and interest obligations on our long-term debt. The following table summarizes our material contractual cash obligations as of December 31, 2023 (dollars in thousands).
These include payments under our long-term debt agreements, rent payments required under operating and finance lease agreements, certain benefit obligations and interest obligations on our long-term debt. The following table summarizes our material contractual cash obligations as of December 31, 2024 (dollars in thousands).
The facility is guaranteed by TriMas Corporation. There were no borrowings on this loan facility as of December 31, 2023, and 2022. Cash management related to our revolving credit facility is centralized.
The facility is guaranteed by TriMas Corporation. There were no borrowings on this loan facility as of December 31, 2024, and 2023. Cash management related to our revolving credit facility is centralized.
However, as a result of the current period of macroeconomic inflation and uncertainty and the potential impact of such factors to our future results of operations, as well as if there is an impact to TriMas' market capitalization, we may record additional cash and non-cash charges related to incremental realignment actions, asset impairments, including impairments to our goodwill, intangible assets, fixed assets, inventory or customer receivable account balances.
However, as a result of the current period of macroeconomic inflation and uncertainty and the potential impact of such factors to our future results of operations, as well as if there is an impact to TriMas' overall performance and market capitalization, we may record additional cash and non-cash charges related to further realignment actions, asset impairments, including impairments to our goodwill, intangible assets, fixed assets, inventory or customer receivable account balances.
We will continue to evaluate opportunities to return capital to shareholders through the purchase of our common stock, depending on market conditions and other factors. Under various agreements, we are obligated to make future cash payments in fixed amounts.
We will continue to evaluate opportunities to return capital to shareholders through the purchase of our common stock, depending on market conditions and other factors. 41 Table of Contents Under various agreements, we are obligated to make future cash payments in fixed amounts.
Common Stock TriMas is listed in the NASDAQ Global Select Market SM . Our stock trades under the symbol "TRS." 42 Table of Contents Credit Rating We and certain of our outstanding debt obligations are rated by Standard & Poor's and Moody's.
Common Stock TriMas is listed in the NASDAQ Global Select Market SM . Our stock trades under the symbol "TRS." Credit Rating We and certain of our outstanding debt obligations are rated by Standard & Poor's and Moody's.
A discussion regarding our financial condition and results of operations for the year ended December 31, 2022 compared to the year ended December 31, 2021 can be found under Item 7 in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the Securities and Exchange Commission on February 23, 2023.
A discussion regarding our financial condition and results of operations for the year ended December 31, 2023 compared to the year ended December 31, 2022 can be found under Item 7 in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the Securities and Exchange Commission on February 29, 2024.
We expect to continue to leverage the tenets of our TriMas Business Model to manage our multi-industry businesses on a longer-term basis, achieve our growth plans, execute continuous improvement initiatives to offset inflationary pressures, and seek lower-cost sources for input costs, all while continuously assessing the appropriateness of our manufacturing footprint and fixed-cost structure.
As we focus our portfolio of businesses, we expect to continue to leverage the tenets of our TriMas Business Model to manage our businesses on a longer-term basis, achieve our growth plans, execute continuous improvement initiatives to offset inflationary pressures and seek lower-cost sources for input costs, all while continuously assessing the appropriateness of our manufacturing footprint and fixed-cost structure.
On March 31, 2023, Moody's affirmed a Ba3 rating to our 2029 Senior Notes, as presented in Note 11, " Long-term Debt " included in Item 8, "Financial Statements and Supplementary Data" within this Form 10-K. Moody's also affirmed a Ba2 Corporate Family Rating and maintained its outlook as stable.
On March 19, 2024, Moody's affirmed a Ba3 rating to our Senior Notes, as presented in Note 11, " Long-term Debt " included in Item 8, "Financial Statements and Supplementary Data" within this Form 10-K. Moody's also affirmed a Ba2 Corporate Family Rating and maintained its outlook as stable.
Our weighted average borrowings were $417.4 million during 2023, compared to $400.1 million during 2022, primarily due to the aggregate principal balance on our senior notes as well as higher borrowings on revolving credit facilities during 2023. In May 2021, we, through one of our non-U.S. subsidiaries, entered into a revolving loan facility with a borrowing capacity of $4 million.
Our weighted average borrowings were $433.9 million during 2024, compared to $417.4 million during 2023, primarily due to the aggregate principal balance on our senior notes as well as higher borrowings on revolving credit facilities during 2024. In May 2021, we, through one of our non-U.S. subsidiaries, entered into a revolving loan facility with a borrowing capacity of $4 million.
In addition, in 2023 , we declared quarterly dividends of $0.04 per share of common stock, aggregating to dividends declared and paid on common shares during 2023 of $6.7 million.
In addition, in 2024 , we declared quarterly dividends of $0.04 per share of common stock, aggregating to dividends declared and paid on common shares during 2024 of $6.6 million.
In 2023, our consolidated subsidiaries that do not guarantee the Senior Notes represented 28% of the total of guarantor and non-guarantor net sales, treating each as a consolidated group and excluding intercompany transactions between guarantor and non-guarantor subsidiaries.
In 2024, our consolidated subsidiaries that do not guarantee the Senior Notes represented 30% of the total of guarantor and non-guarantor net sales, treating each as a consolidated group and excluding intercompany transactions between guarantor and non-guarantor subsidiaries.
Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. We record interest and penalties related to unrecognized tax benefits in income tax expense. 44 Table of Contents Asbestos-related Matters.
Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. We record interest and penalties related to unrecognized tax benefits in income tax expense. Asbestos-related Matters.
Our results of operations have been materially impacted over the past few years by macro-economic factors, first by the onset and proliferation of the coronavirus pandemic ("pandemic"), then further from increased energy costs and supply chain disruptions from the Russia-Ukraine conflict, and more recently by cost inflation (raw materials, wage rates and freight) and a lack of material and in certain regions skilled labor availability.
Our results of operations have been materially impacted over the past few years by macro-economic factors, first by the onset and proliferation of the coronavirus pandemic ("pandemic"), then further from increased energy costs and supply chain disruptions from the Russia-Ukraine conflict, and more recently by cost inflation (raw materials, wage rates and freight) a lack of material and in certain regions skilled labor availability, as well as recent periods of destocking from prior periods of over-ordering by customers.
In February 2023, we acquired Aarts Packaging B.V. ("Aarts"), a luxury packaging solutions provider for beauty and lifestyle brands, as well as for customers in the food and life sciences end markets, for a purchase price of $37.8 million, net of cash acquired.
("Aarts"), a luxury packaging solutions provider for beauty and lifestyle brands, as well as for customers in the food and life sciences end markets, for a purchase price of $37.8 million, net of cash acquired.
As of December 31, 2023, we were party to foreign exchange forward and swap contracts to hedge changes in foreign currency exchange rates with notional amounts of $138.6 million. We also use cross-currency swap agreements to mitigate currency risks associated with the net investment in certain of our foreign subsidiaries.
As of December 31, 2024, we were party to foreign exchange forward and swap contracts to hedge changes in foreign currency exchange rates with notional amounts of $105.9 million. We also use cross-currency swap agreements to mitigate currency risks associated with the net investment in certain of our foreign subsidiaries.
In addition, our non-guarantor subsidiaries represented 38% and 15% of the total guarantor and non-guarantor assets and liabilities, respectively, as of December 31, 2023, treating the guarantor and non-guarantor subsidiaries each as a consolidated group.
In addition, our non-guarantor subsidiaries represented 37% and 15% of the total guarantor and non-guarantor assets and liabilities, respectively, as of December 31, 2024, treating the guarantor and non-guarantor subsidiaries each as a consolidated group.
The majority of our cash on hand as of December 31, 2023, is located in jurisdictions outside the United States. We have available funding under our revolving credit facility of $256.9 million at December 31, 2023, (after consideration of the aforementioned leverage restrictions).
The majority of our cash on hand as of December 31, 2024, is located in jurisdictions outside the United States. We have available funding under our revolving credit facility of $216.7 million at December 31, 2024, (after consideration of the aforementioned leverage restrictions).
Receivables are presented net of allowances for doubtful accounts of $4.2 million and $1.7 million at December 31, 2023 and 2022, respectively. We monitor our exposure for credit losses and maintain adequate allowances for doubtful accounts.
Receivables are presented net of allowances for doubtful accounts of $3.2 million and $4.2 million at December 31, 2024 and 2023, respectively. We monitor our exposure for credit losses and maintain adequate allowances for doubtful accounts.
Our largest raw material purchases are for resins (such as polypropylene and polyethylene), steel, aluminum, superalloys (such as titanium, A286 stainless steel and Inconel) and other oil and metal-based purchased components, the costs for each of which have experienced recent volatility.
Our largest raw material purchases are for polypropylene, polyethylene, steel, aluminum, superalloys (such as titanium, A286 stainless steel and Inconel) and other oil and metal-based purchased components, the costs for each of which are subject to volatility.
The increased use of cash for 2023 and 2022 is due primarily to the timing of sales and related collection of cash during the periods. Days sales outstanding of receivables increased by six days in 2023 and five days in 2022. • We increased our investment in inventory by $7.1 million and $7.0 million in 2023 and 2022, respectively.
The increased use of cash for 2024 and 2023 is due primarily to the timing of sales and related collection of cash during the periods. Days sales outstanding of receivables increased by two days in 2024 and six days in 2023. • We increased our investment in inventory by $21.2 million and $7.1 million in 2024 and 2023, respectively.
As of December 31, 2023, the Credit Agreement is subject to benchmark interest rates that are based on the currency denomination of borrowings, with British pound sterling borrowings subject to the Sterling Overnight Index Average and Euro borrowings subject to the Euro InterBank Offered Rate, both plus a spread of 1.625%, and U.S. dollar borrowings subject to the Secured Overnight Financing Rate plus a spread of 1.725%.
As of December 31, 2024, monthly borrowings under the Credit Agreement are subject to benchmark interest rates that are based on the currency denomination of borrowings, with British pound sterling borrowings subject to the Sterling Overnight Index Average and Euro borrowings subject to the Euro InterBank Offered Rate, both plus a spread of 1.75%, and U.S. dollar borrowings subject to the Secured Overnight Financing Rate plus a spread of 1.85%.
Our actual total net leverage ratio was 2.39 to 1.00 at December 31, 2023. Our permitted interest expense coverage ratio under the Credit Agreement is 3.00 to 1.00, and our actual interest expense coverage ratio was 11.13 to 1.00 as of December 31, 2023. At December 31, 2023, we were in compliance with our financial covenants.
Our actual total net leverage ratio was 2.57 to 1.00 at December 31, 2024. Our permitted interest expense coverage ratio under the Credit Agreement is 3.00 to 1.00, and our actual interest expense coverage ratio was 8.24 to 1.00 as of December 31, 2024. At December 31, 2024, we were in compliance with our financial covenants.
Significant changes in cash flows provided by operating activities and the reasons for such changes are as follows: • In 2023, the Company generated $110.5 million in cash flows, based on the reported net income of $40.4 million and after considering the effects of non-cash items related to impairment of indefinite-lived intangible assets, depreciation, amortization of intangible assets and debt issuance costs, (gain) loss on dispositions of assets, changes in deferred income taxes, stock-based compensation, provision for losses on accounts receivable and other operating activities.
Significant changes in cash flows provided by operating activities and the reasons for such changes are as follows: • In 2024, the Company generated $107.3 million in cash flows, based on the reported net income of $24.3 million and after considering the effects of non-cash items related to impairment of indefinite-lived intangible assets, depreciation, amortization of intangible assets and debt issuance costs, (gain) loss on dispositions of assets, changes in deferred income taxes, stock-based compensation, provision for losses on accounts receivable, change in asbestos and environmental liability estimates and other operating activities.
In November 2021 and April 2023, we amended the Credit Agreement to replace LIBOR.
In April 2023, we amended the Credit Agreement to replace LIBOR.
At December 31, 2022, we had no amounts outstanding under our revolving credit facility and had $293.9 million potentially available after giving effect to $6.1 million of letters of credit issued and outstanding.
At December 31, 2023, we had no amounts outstanding under our revolving credit facility and had $294.0 million potentially available after giving effect to $6.0 million of letters of credit issued and outstanding.
The Credit Agreement allows issuance of letters of credit, not to exceed $40.0 million in aggregate, against revolving credit facility commitments. At December 31, 2023, we had no amounts outstanding under our revolving credit facility and had $294.0 million potentially available after giving effect to $6.0 million of letters of credit issued and outstanding.
The Credit Agreement allows issuance of letters of credit, not to exceed $40.0 million in aggregate, against revolving credit facility commitments. At December 31, 2024, we had $1.5 million outstanding under our revolving credit facility and had $292.2 million potentially available after giving effect to $6.3 million of letters of credit issued and outstanding.
We have seen a number of global market uncertainties stemming from the macro-economic environment in the past few years, including significant challenges in inflationary pressures, supply chain disruptions and labor availability, as well as significant volatility in our customers' sentiment and order patterns.
We will continue to monitor trends in demand changes and adjust costs and investments accordingly. We have seen a number of global market uncertainties stemming from the macro-economic environment in the past few years, including significant challenges in inflationary pressures, supply chain disruptions and labor availability, as well as significant volatility in our customers' sentiment and order patterns.
Liquidity and Capital Resources Cash Flows Cash flows provided by operating activities in 2023 were $88.2 million, as compared to $72.6 million in 2022.
Liquidity and Capital Resources Cash Flows Cash flows provided by operating activities in 2024 were $63.8 million, as compared to $88.2 million in 2023.
The effective income tax rate for 2023 was 20.2%, compared to 24.5% for 2022. We recorded income tax expense of $10.2 million in 2023, as compared to $21.5 million in 2022.
The effective income tax rate for 2024 was 19.3%, compared to 20.2% for 2023. We recorded income tax expense of $5.8 million in 2024, as compared to $10.2 million in 2023.
These charges consisted of $2.1 million employee-related costs, $0.8 million for the write down of inventory to fair value, $5.2 million related to other facility move and consolidation costs, and $2.2 million were related to charges to accelerate the depreciation of certain fixed assets.
These charges consisted of $2.1 million employee-related costs, $0.8 million for the write down of inventory to fair value, $5.2 million related to other facility move and consolidation costs, and $2.2 million were related to charges to accelerate the depreciation of certain fixed assets. Our effective tax rate for 2024 and 2023 was 19.3%, and 20.2%, respectively.
Upon completion of the quantitative impairment test, we determined that one of our aerospace-related trade names had a carrying value that exceeded its fair value, and therefore recorded an impairment charge of $1.1 million during 2023.
Upon completion of the quantitative impairment test, we determined that one of the Life Sciences trade names had a carrying value that exceeded its fair value, and therefore recorded an impairment charge of $0.2 million.
The changes in 2023 and 2022 are primarily as a result of the timing of payments made for income taxes and certain operating expenses. • Decreases in accounts payable and accrued liabilities resulted in a use of cash of $14.5 million and $29.1 million in 2023 and 2022, respectively.
The changes in 2024 and 2023 are primarily as a result of the timing of payments made for income taxes and certain operating expenses. • Increases in accounts payable and accrued liabilities resulted in a source of cash of $0.6 million in 2024, as compared to a use of cash of $14.5 million in 2023.
After consideration of leverage restrictions contained in the Credit Agreement, as of December 31, 2023, we had $256.9 million of borrowing capacity available for general corporate purposes. Our borrowing capacity was not reduced by leverage restrictions contained in the Credit Agreement as of December 31, 2022.
After consideration of leverage restrictions contained in the Credit Agreement, as of December 31, 2024 and 2023, we had $216.7 million and $256.9 million, respectively, of borrowing capacity available for general corporate purposes.
During 2023, 2022 and 2021, we purchased 680,594, 1,264,088 and 596,084 shares of our outstanding common stock for $18.8 million, $36.9 million and $19.1 million, respectively. Since the initial authorization through December 31, 2023, we have purchased 5,795,497 shares of our outstanding common stock for an aggregate purchase price of $163.1 million.
During 2024, 2023 and 2022, we purchased 771,067, 680,594 and 1,264,088 shares of our outstanding common stock for $19.3 million, $18.8 million and $36.9 million, respectively. Since the initial authorization through December 31, 2024, we have purchased 6,566,564 shares of our outstanding common stock for an aggregate purchase price of $182.4 million.
In 2022, the Company generated $109.2 million in cash flows based on the reported net income of $66.2 million and after considering the effects of similar non-cash items and change in legacy liability estimate. • Increases in accounts receivable resulted in a use of cash of $5.5 million and $6.7 million in 2023 and 2022, respectively.
In 2023, the Company generated $110.5 million in cash flows based on the reported net income of $40.4 million and after considering the effects of similar non-cash items. • Increases in accounts receivable resulted in a use of cash of $20.5 million and $5.5 million in 2024 and 2023, respectively.
If our credit ratings were to decline, our ability to access certain financial markets may become limited, our cost of borrowings may increase, the perception of us in the view of our customers, suppliers and security holders may worsen and as a result, we may be adversely affected.
If our credit ratings were to decline, our ability to access certain financial markets may become limited, our cost of borrowings may increase, the perception of us in the view of our customers, suppliers and security holders may worsen and as a result, we may be adversely affected. 42 Table of Contents Outlook Through 2024, we proactively managed through a significant destocking period and resulting demand trough as compared to the prior year period within our cylinder business.
During 2023, we purchased 680,594 shares of our outstanding common stock for an aggregate purchase price of $18.8 million. As of December 31, 2023, we had $86.9 million remaining under the repurchase authorization.
During 2024, we purchased 771,067 shares of our outstanding common stock for an aggregate purchase price of $19.3 million. As of December 31, 2024, we had $67.6 million remaining under the repurchase authorization.
In addition, net sales increased $1.5 million due to currency exchange, as our reported results in U.S. dollars were favorably impacted as a result of the weakening U.S. dollar relative to foreign currencies. Gross profit margin (gross profit as a percentage of sales) approximated 22.5% and 23.6% in 2023 and 2022, respectively.
The increase in net sales was also offset by $2.0 million due to currency exchange, as our reported results in U.S. dollars were unfavorably impacted as a result of the strengthening U.S. dollar relative to foreign currencies. 35 Table of Contents Gross profit margin (gross profit as a percentage of sales) approximated 21.6% and 22.5% in 2024 and 2023, respectively.
We expect leasing will continue to be an available financing option to fund future capital expenditure requirements. 41 Table of Contents In March 2020, we announced our Board of Directors had authorized us to increase the purchase of our common stock up to $250 million in the aggregate, an increase of $100 million from the previous authorization.
In March 2020, we announced our Board of Directors had authorized us to increase the purchase of our common stock up to $250 million in the aggregate, an increase of $100 million from the previous authorization.
Interest expense increased $1.8 million, to $15.9 million in 2023, as compared to $14.1 million in 2022, due to a higher effective interest rate and an increase in our weighted average borrowings.
Interest expense increased $3.6 million, to $19.6 million in 2024, as compared to $15.9 million in 2023, due to a higher effective interest rate and an increase in our weighted average borrowings as a result of increased borrowings from our revolving credit facility.
We made a payment of $3.4 million related to the expiration of one of our cross-currency swap agreements. We also received proceeds of $0.5 million from the disposition of property and equipment.
During 2023, we paid $77.3 million, net of cash acquired, to acquire Aarts and Weldmac, invested $54.2 million in capital expenditures, made a payment of $3.4 million related to the expiration of one of our cross-currency swap agreements, and received proceeds of $0.5 million from the disposition of property and equipment.
Other income decreased $1.6 million to $1.1 million in 2023, from $2.7 million in 2022, primarily due to the year-over-year impact of the reversal of the TFI contingent consideration liability in 2022 and a non-cash settlement charge for our Canadian defined benefit obligations, partially offset by a decrease in other expenses.
Other income increased $1.3 million to $2.4 million in 2024, from $1.1 million in 2023, primary due to the $2.2 million reversal of the Weldmac contingent consideration liability in 2024 and by a non-cash settlement charge for our Canadian defined benefit obligations during 2023, partially offset by increased foreign translation losses.
We have sufficient cash and available liquidity under our revolving credit facility to meet our debt service obligations, capital expenditure requirements and other short-term and long-term obligations for the foreseeable future. 32 Table of Contents Critical factors affecting our ability to succeed include: our ability to create organic growth through product development, cross-selling and extending product-line offerings, and our ability to quickly and cost-effectively introduce and successfully launch new products; our ability to acquire and integrate companies or products that supplement existing product lines, add new distribution channels or customers, or expand our geographic coverage; our ability to manage our cost structure more efficiently via supply chain management, internal sourcing and/or purchasing of materials, selective outsourcing and/or purchasing of support functions, working capital management, and greater leverage of our administrative functions; and our ability to absorb, or recover via commercial actions, inflationary or other cost increases.
Critical factors affecting our ability to succeed include: our ability to generate organic growth through product development, cross-selling and extending product-line offerings, and our ability to quickly and cost-effectively introduce and successfully launch new products; our ability to acquire and integrate companies or products that supplement existing product lines, add adjacent distribution channels and new customers, or expand our geographic coverage; our ability to manage our cost structure more efficiently via supply chain management, internal sourcing and/or purchasing of materials, selective outsourcing and/or purchasing of support functions, working capital management, and greater leverage of our administrative functions; and our ability to absorb, or recover via commercial actions, inflationary or other cost increases, including tariffs and duties. 32 Table of Contents Our overall business does not experience significant seasonal fluctuation, other than our fourth quarter, which has tended to be the lowest net sales quarter of the year due to holiday shutdowns at certain customers or other customers deferring capital spending to the following year.
Altogether, this significant level of volatility in demand levels, input and transportation costs, and material and labor availability, have pressured our ability to operate efficiently and at historical margin levels. Overall, 2023 net sales increased $9.7 million, or 1.1%, compared to 2022.
Altogether, this significant level of volatility in demand levels, input and transportation costs, and material and labor availability, have pressured our ability to operate efficiently in recent periods.
Aarts, which is reported in our Packaging segment, is located in Waalwijk, the Netherlands, and contributed $23.6 million of net sales during 2023.
Aarts, which is reported in our Packaging segment, is located in Waalwijk, the Netherlands, and contributed $2.8 million of acquisition-related sales growth during 2024 resulting from its January 2024 sales.
Certain of our products for industrial applications, for example steel cylinders for packaged gas applications, and engines and compressors for oil & gas extraction, have experienced volatility in demand related to a number of channel and economic factors in more recent periods.
Certain of our products for industrial applications, for example steel cylinders for packaged gas applications, have experienced volatility in demand related to customers securing high order rates in prior periods, only to enter a period of destocking in more recent periods.
Sales of our engineered components products increased by $7.6 million due to higher end market demand. Gross profit within Aerospace increased $15.8 million to $48.0 million, or 19.9% of sales, in 2023, from $32.2 million, or 17.1% of sales, in 2022.
Sales of our engineered components products increased by $17.6 million due to improved throughput, commercial recoveries and new business wins. Gross profit within Aerospace increased $21.9 million to $69.9 million, or 23.8% of sales, in 2024, from $48.0 million, or 19.9% of sales, in 2023.
The 2029 Senior Notes accrue interest at a rate of 4.125% per annum, payable semi-annually in arrears on April 15 and October 15. The payment of principal and interest is jointly and severally guaranteed, on a senior unsecured basis by certain named subsidiaries of the Company.
The payment of principal and interest is jointly and severally guaranteed, on a senior unsecured basis by certain named subsidiaries of the Company.
On May 22, 2023, Standard & Poor's affirmed a BB- rating to our 2029 Senior Notes. Standard & Poor's also affirmed a BB corporate credit rating and maintained its outlook as stable.
On January 7, 2025, Moody's affirmed a Ba3 rating to our Senior Notes and a Ba2 Corporate Family Rating, and changed its outlook from stable to negative. On June 28, 2024, Standard & Poor's affirmed a BB- rating to our Senior Notes. Standard & Poor's also affirmed a BB corporate credit rating and maintained its outlook as stable.
During 2023, we reported domestic and foreign pre-tax income of $20.7 million and $29.9 million, respectively, as compared to domestic and foreign pre-tax income of $56.8 million and $30.9 million in 2022.
During 2024, we reported domestic and foreign pre-tax income of $3.3 million and $26.7 million, respectively, as compared to domestic and foreign pre-tax income of $20.7 million and $29.9 million, respectively, in 2023. The rate for 2024 is lower primarily as a result of a change in the mix of domestic and foreign pre-tax results.
Our days sales in inventory increased by eleven days in 2023, primarily as a result of investing in certain inventories in our Aerospace segment as a result of increased customer demand.
Our days sales in inventory increased by eleven days in 2023, primarily as a result of investing in certain inventories in our Aerospace segment as a result of increased customer demand. • Increases in prepaid expenses and other assets resulted in a use of cash of $2.3 million in 2024, while decreases in prepaid expenses and other assets resulted in a source of cash of $4.8 million in 2023.
Despite the potential for declines in future demand levels and results of operations, at present, we believe our capital structure is in a strong position.
Despite the potential for declines in future demand levels and results of operations, at present, we believe our capital structure is in a strong position. We have sufficient cash and available liquidity under our revolving credit facility to meet our debt service obligations, capital expenditure requirements and other short-term and long-term obligations for the foreseeable future.
This decrease was primarily a result of a decrease in operating profit of $33.6 million, a $1.8 million increase in interest expense, and a $1.6 million decrease in other income, partially offset by a decrease in income tax expense of $11.3 million. See below for a discussion of operating results by segment. Packaging.
Net income decreased $16.1 million to $24.3 million in 2024, compared to $40.4 million in 2023. This decrease was primarily a result of a decrease in operating profit of $18.3 million and a $3.6 million increase in interest expense, partially offset by a decrease in income tax expense of $4.4 million and a $1.3 million increase in other income.
We are subject to variable interest rates on our revolving credit facility, which is subject to a benchmark interest rate determined based on the currency denomination of borrowings. At December 31, 2023, we had no amounts outstanding on our revolving credit facility and, therefore, no variable rate-based borrowings outstanding.
We are subject to variable interest rates on our revolving credit facility, which is subject to a benchmark interest rate determined based on the currency denomination of borrowings. In addition to our long-term debt, we have other cash commitments related to leases.
Gross profit increased primarily due to higher sales levels and improved manufacturing throughput and fixed cost absorption, partially offset by increased material costs, wage inflation and a $2.4 million purchase accounting non-cash charge related to the step-up of Weldmac's inventory to fair value.
Gross profit increased primarily due to higher sales levels and resulting improved fixed cost absorption, reduced material availability constraints, a more favorable product sales mix, favorable commercial recoveries, and a $2.4 million purchase accounting charge related to the step-up of inventory to fair value in 2023 that did not repeat.
Selling, general and administrative expenses increased $2.4 million to $31.4 million, or 13.0% of sales, in 2023, as compared to $29.0 million, or 15.4% of sales, in 2022, primarily due to higher ongoing selling, general and administrative costs associated with our acquisition of Weldmac and higher facility costs, partially offset by lower employee-related costs and lower intangible asset amortization expense due to certain assets becoming fully amortized.
Selling, general and administrative expenses increased $4.8 million to $36.2 million, or 12.3% of sales, in 2024, as compared to $31.4 million, or 13.0% of sales, in 2023, primarily due to higher employee-related costs, higher information technology costs,$1.8 million of increased costs related to the labor union strike, and higher ongoing selling, general and administrative costs associated with our acquisition of Weldmac.
These decreases were partially offset by the impact of higher sales levels and related improved fixed cost absorption within our Aerospace segment, higher sales levels and favorable pricing in our Specialty Products segment, and lower material and other input costs in our Packaging segment.
These decreases were partially offset by higher sales levels and related improved fixed cost absorption and the impact of a charge related to purchase accounting in 2023 that did not repeat within our Packaging and Aerospace segments.
Payments Due by Periods Total Less than One Year 1 - 3 Years 3 - 5 Years More than 5 Years Contractual and other cash obligations: Long-term debt $ 400,000 $ — $ — $ — $ 400,000 Operating lease obligations 52,420 9,560 16,770 13,140 12,950 Finance lease obligations 2,370 540 1,130 700 — Benefit obligations 16,400 1,310 2,780 3,040 9,270 Interest obligations (a) 90,750 16,500 33,000 33,000 8,250 Total contractual and other cash obligations $ 561,940 $ 27,910 $ 53,680 $ 49,880 $ 430,470 __________________________ (a) Our Senior Notes bear interest at 4.125%.
Payments Due by Periods Total Less than One Year 1 - 3 Years 3 - 5 Years More than 5 Years Contractual and other cash obligations: Long-term debt $ 401,500 $ — $ 1,500 $ 400,000 $ — Operating lease obligations 49,490 9,070 17,330 11,210 11,880 Finance lease obligations 1,800 520 1,280 — — Benefit obligations 16,880 1,380 2,890 3,220 9,390 Interest obligations (a) 74,250 16,500 33,000 24,750 — Total contractual and other cash obligations $ 543,920 $ 27,470 $ 56,000 $ 439,180 $ 21,270 __________________________ (a) Our Senior Notes bear interest at 4.125%.
Operating profit within Aerospace increased $7.5 million to $15.5 million, or 6.4% of sales, in 2023, as compared to $8.1 million, or 4.3% of sales, in 2022, primarily due to the impact of higher sales levels and improved manufacturing throughput and fixed cost absorption.
Packaging's operating profit increased $8.0 million to $68.1 million, or 13.3% of sales, in 2024, as compared to $60.1 million, or 13.0% of sales, in 2023, primarily due to higher sales levels, improved fixed cost absorption, and the favorable impact of prior realignment actions, and the impact of $1.0 million higher net gains on sales of non-core properties.
The income approach relies on the present value of estimated future cash flows of the business, discounted using a rate appropriately reflecting the risks inherent in the cash flows. The market approach relies on market data of other public companies that we deem comparable in operations to our reporting units.
In conducting the quantitative analysis for the Life Sciences reporting unit, we determined the estimated fair value utilizing both income and market-based approaches. The income approach relies on the present value of estimated future cash flows of the business, discounted using a rate appropriately reflecting the risks inherent in the cash flows.
The most significant drivers affecting our financial results in 2023 compared with 2022 , other than as directly impacted by sales changes, were the impact of our recent acquisitions, improved manufacturing throughput in our Aerospace segment, material cost abatement in our Packaging segment, realignment actions in our Packaging segment, the year-over-year impact of the sale of non-core real estate in 2022, the year-over-year impact of the termination of our existing cross-currency swap agreements in 2022, and a decrease in our effective tax rate. 31 Table of Contents In April 2023, we acquired Weldmac Manufacturing Company ("Weldmac"), a designer and manufacturer of complex metal fabricated components and assemblies for the aerospace, defense and space launch end markets for a purchase price of $34.0 million, with additional contingent consideration ranging from zero to $10 million based on achievement of earnings targets.
The most significant drivers affecting our financial results in 2024 compared with 2023 , other than as directly impacted by sales change s, were the impact of our recent acquisitions, accelerated depreciation charges related to shortening the useful lives of certain machinery and equipment in our Specialty Products segment, increased costs and decreased sales resulting from a prolonged labor union strike at one of our manufacturing facilities within our Aerospace segment, a charge to update our asbestos liability based on our recent actuarial valuation, improved material availability within our Aerospace segment, charges associated with environmental remediation liabilities, increased input costs, including expedited freight within our Packaging segment, lower realignment charges, and a decrease in our effective tax rat e. 31 Table of Contents In April 2023, we acquired Weldmac Manufacturing Company ("Weldmac"), a designer and manufacturer of complex metal fabricated components and assemblies for the aerospace, defense and space launch end markets for a purchase price of $34.0 million, with additional contingent consideration of $5.5 million paid in July 2023 and $2.25 million paid in October 2024 based on achievement of earnings targets.
Year ended December 31, 2023 Net income $ 40,360 Bank stipulated adjustments: Interest expense, net (as defined) 15,920 Income tax expense 10,230 Depreciation and amortization 57,590 Non-cash compensation expense (1) 9,670 Other non-cash expenses or losses 760 Non-recurring expenses or costs (2) 18,950 Effects of purchase accounting adjustments 3,190 Business and asset dispositions 410 Permitted acquisitions 3,030 Currency gains and losses (130) Consolidated Bank EBITDA, as defined $ 159,980 December 31, 2023 Total Indebtedness, as defined (3) $ 383,070 Consolidated Bank EBITDA, as defined 159,980 Actual total net leverage ratio 2.39 x Covenant requirement 4.00 x Year ended December 31, 2023 Interest expense, as defined $ 15,920 Bank stipulated adjustments: Interest income (620) Non-cash amounts attributable to amortization of financing costs (930) Total Consolidated Cash Interest Expense, as defined $ 14,370 40 Table of Contents December 31, 2023 Consolidated Bank EBITDA, as defined $ 159,980 Total Consolidated Cash Interest Expense, as defined 14,370 Actual interest expense coverage ratio 11.13 x Covenant requirement 3.00 x ________________________________________ (1) Non-cash compensation expenses resulting from the grant of equity awards.
Year ended December 31, 2024 Net income $ 24,250 Bank stipulated adjustments: Interest expense, net (as defined) 19,560 Income tax expense 5,790 Depreciation and amortization 64,920 Impairment charges (1) 230 Non-cash compensation expense (2) 6,960 Other non-cash expenses or losses 190 Non-recurring expenses or costs (3) 20,910 Extraordinary, non-recurring or unusual gains or losses 8,530 Business and asset dispositions (1,000) Currency gains and losses 1,340 Consolidated Bank EBITDA, as defined $ 151,680 December 31, 2024 Total Indebtedness, as defined (4) $ 390,050 Consolidated Bank EBITDA, as defined 151,680 Actual total net leverage ratio 2.57 x Covenant requirement 4.00 x Year ended December 31, 2024 Interest expense, as defined $ 19,560 Bank stipulated adjustments: Interest income (200) Non-cash amounts attributable to amortization of financing costs (960) Total Consolidated Cash Interest Expense, as defined $ 18,400 40 Table of Contents December 31, 2024 Consolidated Bank EBITDA, as defined $ 151,680 Total Consolidated Cash Interest Expense, as defined 18,400 Actual interest expense coverage ratio 8.24 x Covenant requirement 3.00 x ________________________________________ (1) Non-cash charges related to indefinite-lived intangible asset impairment.
Our days accounts payable on hand increased by one day through 2023 and remained consistent through 2022. Our days accounts payable on hand fluctuate primarily as a result of the timing of payments made to suppliers and the mix of vendors and related terms.
Our days accounts payable on hand fluctuate primarily as a result of the timing of payments made to suppliers and the mix of vendors and related terms. 38 Table of Contents Net cash used for investing activities was $47.0 million and $134.4 million in 2024 and 2023, respectively.
Additional Key Risks that May Affect Our Reported Results We have executed meaningful realignment actions over the past few years, primarily in our Packaging segment, to address manufacturing capacity where demand has fallen. We will continue to assess further actions if required.
The decrease in effective tax rate 2024 as compared to 2023 is primarily as a result of a change in the mix of domestic and foreign pre-tax results. Additional Key Risks that May Affect Our Reported Results We have executed meaningful realignment actions over the past few years to address variable and structural costs where demand has fallen.
(2) Non-recurring costs and expenses relating to trade name impairment charges, diligence and transaction costs, purchase accounting costs, severance, relocation, restructuring and settlement expenses. (3) Includes $4.5 million of acquisition-related contingent consideration, $1.3 million of derivative liabilities and $2.2 million of finance leases as of December 31, 2023.
(2) Non-cash compensation expenses resulting from the grant of equity awards. (3) Non-recurring costs and expenses relating to diligence and transaction costs, strike related costs, severance, relocation and realignment. (4) Includes $1.6 million of finance leases as of December 31, 2024.
Corporate expenses included in operating profit consist of the following (dollars in millions): Year ended December 31, 2023 2022 Corporate operating expenses $ 36.7 $ 22.4 Non-cash stock compensation 9.7 9.8 Legacy expenses 0.2 5.7 Gain on disposition of assets — (17.6) Corporate expenses $ 46.6 $ 20.3 37 Table of Contents Corporate expenses increased $26.4 million to $46.6 million in 2023, from $20.3 million in 2022, primarily due to the year-over-year impact of a $17.6 million gain recognized in 2022 on the sale of a non-core facility in City of Industry, California, $4.5 million of higher professional fees primarily for business diligence and strategic consulting, and $8.3 million of higher information technology costs in 2023, of which $6.8 million related to costs now reported as corporate expenses due to centralizing certain of our information technology costs in 2023.
Corporate expenses included in operating profit consist of the following (dollars in millions): Year ended December 31, 2024 2023 Corporate operating expenses $ 36.0 $ 36.7 Non-cash stock compensation 7.0 9.7 Legacy expenses 9.7 0.2 Corporate expenses $ 52.7 $ 46.6 Corporate expenses increased $6.1 million to $52.7 million in 2024, from $46.6 million in 2023, primarily due to a $5.5 million pre-tax charge related to updating our asbestos studies in 2024, $3.6 million of pre-tax charges related to our environment remediation obligations and $1.3 million of higher professional costs associated with business acquisition, diligence and transaction related activity.
Selling, general and administrative expenses within Specialty Products decreased $0.9 million to $7.8 million, or 4.2% of sales, in 2023, as compared to $8.7 million, or 5.0% of net sales, in 2022, primarily due to the transfer of information technology costs to Corporate in 2023, as well as lower overall spending levels.
Packaging's selling, general and administrative expenses increased $7.7 million to $56.4 million, or 11.0% of sales, in 2024, as compared to $48.8 million, or 10.5% of sales, in 2023, primarily due to $4.7 million higher information technology costs allocated from Corporate, higher employee-related costs and higher professional fees.
While we expect gradual demand recovery in the consumer products and industrial markets and continued strength in our aerospace & defense market, we believe this period of global market uncertainty will continue into 2024, at least in the near-term.
While we expect a continued modest demand recovery in certain of our consumer products and industrial markets and continued strength in our aerospace & defense market, we remain cautious of the impact of global market uncertainty, particularly the potential impact of tariffs on our customer demand and our input costs.
In addition to our long-term debt, we have other cash commitments related to leases. The majority of our lease transactions are accounted for as operating leases, and we incurred rent expense for continuing operations related thereto of $14.9 million in 2023.
The majority of our lease transactions are accounted for as operating leases, and we incurred rent expense related thereto of $13.9 million in 2024. We expect leasing will continue to be an available financing option to fund future capital expenditure requirements.
In addition, we incurred lower intangible asset amortization expense due to certain assets becoming fully amortized. These decreases more than offset higher ongoing selling, general and administrative costs associated with our acquisitions.
These increases were partially offset by lower legal costs and lower intangible asset amortization expense due to certain assets becoming fully amortized.

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