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What changed in TRIMAS CORP's 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of TRIMAS CORP's 2022 and 2023 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 2023 report.

+326 added−316 removedSource: 10-K (2024-02-29) vs 10-K (2023-02-23)

Top changes in TRIMAS CORP's 2023 10-K

326 paragraphs added · 316 removed · 244 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

87 edited+18 added−2 removed61 unchanged
Biggest changeGiven the focused nature of many of our products, we rely upon a combination of a direct sales force and an established network of distributors with familiarity of the end-users. Norris Cylinder, for example, sells directly to customers and through distributors. Our primary customers include industrial gas producers and distributors, welding equipment distributors, and equipment manufacturers.
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.
We continue to place a priority on investing in innovation to protect and enhance our product designs, brand names, and manufacturing processes and competencies. • Customer-Focused Solutions and Long-Term Customer Relationships. We work collaboratively with our customers to design new product applications that help satisfy rapidly changing preferences in the marketplace.
We continue to place a priority on investing in innovation to enhance and protect our product designs, brand names, and manufacturing processes and competencies. • Customer-Focused Solutions and Long-Term Customer Relationships. We work collaboratively with our customers to design new product applications that help satisfy rapidly changing preferences in the marketplace.
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 the 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 core strategy: • Leverage our TriMas Business Model.
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") / 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, 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 believe that TriMas Aerospace is a leading designer, developer and manufacturer of 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 machined components such as those used in air ducting systems.
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 goals, 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 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.
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 industry.
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.
The aerospace industry has strict requirements for quality and delivery, making process innovation and continuous improvement vital to TriMas Aerospace's success. We believe TriMas Aerospace’s manufacturing processes, capabilities and quality focus create a competitive strength for the business. Marketing, Customers and Distribution TriMas Aerospace serves both OEM and aftermarket customers on a wide variety of platforms.
The aerospace industry has strict requirements for quality and delivery, making process innovation and continuous improvement vital to TriMas Aerospace's success. We believe TriMas Aerospace's manufacturing processes, capabilities and quality focus create a competitive strength for the business. Marketing, Customers and Distribution TriMas Aerospace serves OEM, distribution and aftermarket customers on a wide variety of platforms.
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 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.
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.
TriMas Packaging has manufacturing and support facilities in the United States, Mexico, Brazil, the United Kingdom, Germany, Italy, Slovakia, China, India, Vietnam and Australia. Competition TriMas Packaging has a broad range of products in closure, dispensing and flexible packaging systems, and therefore has various competitors in each of our product offerings.
TriMas Packaging has manufacturing and support facilities in the United States, Mexico, Brazil, the United Kingdom, the Netherlands, Germany, Italy, Slovakia, China, India, Vietnam and Australia. Competition TriMas Packaging has a broad range of products in closure, dispensing and flexible packaging systems, and therefore has various competitors in each of our product offerings.
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. • Drive Enhanced Cash Conversion.
Overall, 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. • Drive Enhanced Cash Conversion.
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 and 2022, 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, in 2021, 2022 and 2023, we administered employee engagement surveys globally.
Seasonality TriMas does not typically experience significant seasonal fluctuation, other than our fourth quarter, which in past years has tended to be the lowest net sales quarter of the year given holiday shutdowns by certain of our customers and other customers deferring capital spending to the following year. 12 Table of Contents Government Regulations Environmental Matters 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.
Seasonality TriMas does not typically experience significant seasonal fluctuation, other than our fourth quarter, which in past years has tended to be the lowest net sales quarter of the year given holiday shutdowns by certain of our customers and other customers deferring capital spending to the following year. 13 Table of Contents Government Regulations Environmental Matters 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.
Item 1. Business Overview TriMas designs, develops and manufactures a diverse set of products primarily for the consumer products, aerospace and industrial markets through its TriMas Packaging, TriMas Aerospace and Specialty Products groups.
Item 1. Business Overview TriMas designs, develops and manufactures a diverse set of products primarily for the consumer products, aerospace & defense, and industrial markets through its TriMas Packaging, TriMas Aerospace and Specialty Products groups.
With more than 70 years of experience, Norris Cylinder is one of the worlds' largest manufacturers of high- and low-pressure 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 in the United States.
In addition to environmental laws and regulations, our operations are governed by variety of laws and regulations, including those relating to workplace safety and worker health, principally the Occupational Safety and Health Act and regulations thereunder.
In addition to environmental laws and regulations, our operations are governed by a variety of laws and regulations, including those relating to workplace safety and worker health, principally the Occupational Safety and Health Act and regulations thereunder.
Because it is our practice and intent to maintain and to continue to support, develop and market these trademarks/trade names for the foreseeable future, we consider our rights in these trademarks/trade names to have an indefinite life, except as otherwise dictated by applicable law. 13 Table of Contents Technology.
Because it is our practice and intent to maintain and to continue to support, develop and market these trademarks/trade names for the foreseeable future, we consider our rights in these trademarks/trade names to have an indefinite life, except as otherwise dictated by applicable law. 14 Table of Contents Technology.
For information pertaining to the net sales and operating profit attributed to our segments, refer to Note 21, " Segment Information ," included in Item 8, " Financial Statements and Supplementary Data ," within this Form 10-K. Each of our segments is described in more detail on the following pages.
For information pertaining to the net sales and operating profit attributed to our segments, refer to Note 20, " Segment Information ," included in Item 8, " Financial Statements and Supplementary Data ," within this Form 10-K. Each of our segments is described in more detail on the following pages.
We believe that both Norris Cylinder and Arrow Engine offer a comprehensive product offering 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.
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.
We intend to leverage our brands, expand our product offerings to current and new customers, 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 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.
Website Access to Company Reports We use our corporate website, www.trimascorp.com, as a channel for routine distribution of important information, including news releases, company presentations and links to our businesses' websites, as well as reinforcing our commitment to sustainability as evidenced by our Sustainability Reports.
Website Access to Company Reports We use our corporate website, www.trimas.com, as a channel for routine distribution of important information, including news releases, company presentations and links to our businesses' websites, as well as reinforcing our commitment to sustainability as evidenced by our Sustainability Reports.
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, as well as 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, and other complex machine-to-print parts for aerospace applications, including auxiliary power units and electrical, hydraulic and pneumatic systems.
These objectives are reinforced by our Code of Conduct, our global policies, including our Global Human Rights Policy, Diversity, Equity & Inclusion Statement, and Environment, Health & Safety Policy, as well as our commitment to sustainability as evidenced by our annual Sustainability Reports. 11 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, 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.
We believe these businesses are well established and recognized in the end markets they serve. 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 steel cylinders for use in industrial, heating, ventilation and air conditioning (HVAC), construction, health care and defense end markets.
We also provide financial information on our website and post filings as soon as reasonably practicable after they are electronically filed with, or furnished to, the Securities and Exchange Commission ("SEC"), including our annual, quarterly, and current reports on Forms 10-K, 10-Q and 8-K, our proxy statements and any amendments to those reports or statements.
We also provide financial information on our website and post filings as soon as reasonably practicable after they are electronically filed with, or furnished to, the SEC, including our annual, quarterly, and current reports on Forms 10-K, 10-Q and 8-K, our proxy statements and any amendments to those reports or statements.
The content on any website referred to in this Annual Report on Form 10-K is not incorporated by reference into this Annual Report on Form 10-K unless expressly noted. 14 Table of Contents
The content on any website referred to in this Annual Report on Form 10-K is not incorporated by reference into this Annual Report on Form 10-K unless expressly noted. 15 Table of Contents
We plan to use this cash for reinvestment in our businesses, strategic acquisitions and other capital allocation actions, such as share buybacks and dividends, which we initiated in 2021. • Foster a Culture of Kaizen and Engagement. We believe our talented and dedicated global team is the foundation of our success.
We plan to use this cash for reinvestment in our businesses, strategic acquisitions and other capital allocation actions, such as share buybacks and dividends. • Foster a Culture of Kaizen and Engagement. We believe our talented and dedicated global team is the foundation of our success.
We believe our customer-focused approach to provide cost-effective technical solutions will drive the development of new products and create new opportunities for growth. 8 Table of Contents • Leading Manufacturing Capabilities and Processes. We believe that TriMas Aerospace is a leading manufacturer of precision-engineered components for the aerospace industry.
We believe our customer-focused approach to provide cost-effective technical solutions will drive the development of new products and create new growth opportunities. • Leading Manufacturing Capabilities and Processes. We believe that TriMas Aerospace is a leading manufacturer of precision-engineered components for the aerospace industry.
Each of our brands are long-term, certified suppliers of aerospace original equipment manufacturers ("OEMs") or Tier 1 suppliers, and have been serving the aerospace industry for decades.
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.
We also foster a culture of employee engagement to drive performance improvements, operational excellence and a sustainable future. • Focus on Sustainability. We view sustainability and Environmental, Social and Governance ("ESG") practices as important components of our culture and rooted in our core values representing who we are as a company.
We also foster a culture of employee engagement to drive performance improvements, operational excellence and a sustainable future. • Focus on Sustainability. We view sustainability and ESG practices as important components of our culture and rooted in our core values representing who we are as a company.
Based on our breadth of products, and engineering and production capabilities, we have achieved preferred supplier status with several customers. • Global Manufacturing Footprint. TriMas Packaging maintains a global network of sales, manufacturing and distribution sites, to serve our global customer base.
Based on our breadth of products, and engineering and production capabilities, we have achieved preferred supplier status with several customers. 7 Table of Contents • Global Manufacturing Footprint. TriMas Packaging maintains a global network of sales, manufacturing and distribution sites, to serve our global customer base.
TriMas Packaging's end customers include, but are not limited to, consumer packaged goods, personal care, beauty and cosmetic, medical, pharmaceutical, nutraceutical, food and beverage, industrial, agricultural, chemical, and cleaning and sanitary supply companies. We also provide products into applications used by warehouse clubs, e-retailers and fast food retailers.
TriMas Packaging's end customers include, but are not limited to, consumer packaged goods, personal care, beauty and cosmetic, medical, pharmaceutical, nutraceutical, food and beverage, industrial, agricultural, chemical, and cleaning and sanitary supply companies. We also provide products into applications used by warehouse clubs, e-retailers and quick-service restaurants.
In December 2021, we acquired TFI Aerospace, a manufacturer and supplier of specialty fasteners used in a variety of applications, predominantly for the aerospace end market. 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 .
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 .
Approximately 74% of our 2022 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 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.
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 market segments with the highest long-term return potential.
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.
Arrow Engine also provides a comprehensive product offering, including engines, compressors, chemical pumps, generator sets, electronics and replacement parts to a variety of oilfield and industrial markets. In addition, utilizing the tools of Kaizen, Arrow Engine developed and launched a new reduced emission EPA-certified A54-E engine platform for stationary and off-road mobile applications. • Established and Extensive Distribution Channels .
Arrow Engine also provides a comprehensive product offering, including engines, compressors and replacement parts to a variety of oilfield and industrial markets. In addition, utilizing the tools of Kaizen, Arrow Engine developed and launched a new reduced emission EPA-certified A54-E engine platform for stationary and off-road mobile applications. • Established and Extensive Distribution Channels .
TriMas focuses on a number of 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.
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.
Our long-standing supply positions in this well-established network 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 Norris Cylinder business has locations in Longview, Texas, and Huntsville, Alabama, which have numerous forging and metalworking pieces of equipment and processes.
We operate manufacturing facilities in Canada, China, Germany, India, Italy, Mexico, 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 $74.5 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 $72.2 million of export sales from the United States.
TriMas Packaging designs and manufactures dispensing products (including foaming pumps, lotion and hand soap pumps, sanitizer pumps, beverage dispensers, perfume sprayers, nasal sprayers and trigger sprayers), polymeric and steel caps and closures (including food lids, flip-top closures, child resistance caps, drum and pail closures and flexible spouts), polymeric jar products, and fully integrated dispensers for fill-ready, flexible bag-in-box applications, for a variety of consumer product markets including, but not limited to, the beauty and personal care, home care, food and beverage, medical, pharmaceutical and nutraceutical, as well as industrial end markets.
TriMas Packaging designs and manufactures dispensing products (including foaming pumps, lotion, hand soap and sanitizer pumps, beverage dispensers, perfume sprayers and trigger sprayers), polymeric and steel caps and closures (including food lids, flip-top closures, child resistant caps, drum and pail closures, and flexible spouts), polymeric jar products, and fully integrated dispensers for fill-ready, flexible bag-in-box applications, for a variety of consumer product markets including, but not limited to, the beauty & personal care, home care, food & beverage and industrial end markets.
We believe our businesses share important and distinguishing characteristics, including: well-recognized brand names in the focused markets we serve; innovative product technologies and features; customer approved processes and qualified products; strong c ash flow generation and long-term growth opportunities.
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.
In 2021, Norris Cylinder became an official “Made in the USA” designated manufacturer, which we believe allows Norris to locally address customers' needs, while maintaining more control over lead times and quality.
In 2021, Norris Cylinder became an official "Made in the USA" designated manufacturer, which we believe allows Norris to locally address customers' needs, while maintaining more control over lead times and quality.
We believe each of our go-to-market brands are well-recognized and firmly established in the focused 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 they make their sourcing decisions. • Innovative and Proprietary Manufacturing and Product Technologies.
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 TriMas, through its relatively low debt profile and its strong free cash flow, is uniquely positioned to enhance organic growth with strategic acquisitions.
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.
Intangible Assets Our identified intangible assets, consisting of customer relationships, trademarks and trade names, and technology, are recorded at $188.1 million at December 31, 2022, 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 $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.
Our acquisitions of Affaba & Ferrari in 2020, and Plastic Srl and Taplast in 2019, provided us with additional sales, design and manufacturing capacity in Europe, with additional manufacturing facilities in 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. In addition, we are starting to expand our supply capabilities into South America, opening our first warehouse in Brazil in 2022.
Arrow Engine tends to compete against natural gas powered, lower horsepower, multi-cylinder engines from manufacturers such as Caterpillar, Chevy, Cummins and Ford industrial engines and electric motors. TriMas' Acquisition Strategy TriMas views the pursuit of strategic acquisitions as core to augmenting its organic growth and achieving our overarching corporate strategy.
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.
This new facility enables TriMas Packaging to shift production of a variety of products currently produced outside of the United States and provide significant incremental capacity for 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 produced outside of the United States closer to our customers, and supports new business growth closer to our customers in North America, as needed.
To serve our customers in Asia, we have design and manufacturing capacity and offer highly engineered dispensing solutions through locations in China, India and Vietnam, and have increased our Asian market sales coverage. We have also increased our sales coverage in Europe.
In addition to our locations in China, we also have design and manufacturing capacity and offer highly-engineered dispensing solutions through locations in India and Vietnam, and have increased our Asian market sales coverage.
We believe each of our businesses is well-positioned through years of refined manufacturing know-how, innovative product development, application engineering and solutions design. We believe our manufacturing footprint and operational competencies would be difficult and costly to replicate, providing us an advantage.
We believe each of our businesses is well-positioned through years of refined manufacturing know-how, innovative product development, application engineering and solutions design. We believe our manufacturing footprint and operational competencies would be difficult and costly to replicate, and provide us a competitive advantage to serve our customers.
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. From 2019 through 2022, TriMas has completed eight 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 2023, TriMas completed ten acquisitions and one divestiture.
International Operations Of our net sales for the year ended December 31, 2022, 21.8% were derived from sales by our businesses located outside of the United States, and 32.8% of our long-lived assets as of December 31, 2022 were located outside of the United States.
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.
Depending on the product and customers served, our competitors include Aptar, Bericap, Berry Global, Greif, Mold-Rite, Phoenix Closures, Silgan, Technocraft and other smaller private companies located in Asia. 7 Table of Contents Aerospace (21% of 2022 net sales) Our Aerospace segment is comprised of TriMas Aerospace, which includes the Monogram Aerospace Fasteners (“Monogram”), Allfast Fastening Systems (“Allfast”), Mac Fasteners, RSA Engineered Products (“RSA”), Martinic Engineering (“Martinic”) and TFI Aerospace (“TFI”) brands.
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.
At times, we also use third-party agents and distributors in our key geographic markets, as well as agents and distributors primarily to sell to container manufacturers and to users or fillers of containers.
We employ commercial teams in North America, South America, Europe and Asia. At times, we also use third-party agents and distributors in our key geographic markets, as well as agents and distributors primarily to sell to container manufacturers and to users or fillers of containers.
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, 2022 as follows: Packaging (net sales: $522.2 million; operating profit: $81.0 million), Aerospace (net sales: $188.1 million; operating profit: $8.1 million) and Specialty Products (net sales: $173.6 million; operating profit: $30.3 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, 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 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 Arrow Engine also has also a leading market position in the niche it serves. • Comprehensive Product Offering .
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 we are a leader in the blind bolt market with significant market share in all blind fastener product categories in which we compete. 9 Table of Contents Specialty Products (20% of 2022 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 (21% of 2023 net sales) Our Specialty Products segment is comprised of our Norris Cylinder and Arrow Engine Company businesses.
Headquartered in Bloomfield Hills, Michigan, TriMas has approximately 3,500 e mployees who serve our customers from 42 manufacturing and support locations in 13 c ountries. During 2022, our net sales were $883.8 million, operating profit was $99.1 million, and net ca sh provided by operating activities was $72.6 million.
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.
As a recognized leader in many of our markets, customers partner with us during the design, product development and production life cycle. These ongoing relationships, often developed over decades, coupled with our expertise in innovation and application engineering, position us to win new and replacement business with our customers when they launch new products or programs. • Experienced Management Team.
These ongoing relationships, often developed over decades, coupled with our expertise in innovation and application engineering, position us to win new and replacement business with our customers when they launch new products or programs. • Experienced Management Team.
Packaging (59% of 2022 net sales) TriMas' Packaging segment consists of TriMas Packaging, which includes the Rieke, Affaba & Ferrari, Taplast, Rapak, Intertech and Omega Plastics brands.
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.
In addition to raw materials, we purchase a variety of components and finished products from sources in lower-cost countries. Polypropylene and polyethylene are generally commodity resins with multiple suppliers capable of providing product globally. Steel is purchased primarily from steel mills and service centers, and on a more localized basis.
Raw materials and other supplies used in our operations are normally available from a variety of competing suppliers. In addition to raw materials, we purchase a variety of components and finished products from sources in lower-cost countries. Polypropylene and polyethylene are generally commodity resins with multiple suppliers capable of providing product globally.
We cannot predict the impact of any further unionization of our workplace. 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.
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 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 better sustainability.
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.
The close working relationship between our sales and engineering teams and our customers’ engineering teams is key to developing future products desired and required by our customers. Our innovation teams add value by working directly with our customers to address assembly and manufacturing process challenges to increase productivity, quality, speed and efficiency, while reducing overall installed cost.
Our innovation teams add value by working directly with our customers to address assembly and manufacturing process challenges to improve productivity and efficiency, while reducing the overall installed cost.
We believe that we supply products for the majority of the new airplanes manufactured by the two largest global airplane OEMs. • Product Innovation. We believe that TriMas Aerospace’s engineering, research and development capability and new product focus are competitive advantages. For many years, TriMas Aerospace’s product development programs have provided innovative and proprietary product solutions.
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.
For example, TriMas Packaging's product development programs have provided innovative and proprietary product solutions, such as the patented single-polymer Mono TM -2e pump, which features six parts, all made from one material, making it fully recyclable. We are also developing additional dispensing products made from a single-material without compromising quality, aesthetics, performance or formula compatibility, under the Singolo TM brand.
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.
As such, in periods of rising demand, as we have experienced in 2021 and 2022, 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. 10 Table of Contents Marketing, Customers and Distribution The customers of our Specialty Products segment predominantly operate in the industrial end markets, and to a lesser extent, the upstream oil and gas end markets.
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 TriMas Packaging's flexible footprint provides us with multiple alternatives for production to best meet customer requirements and helps mitigate the impacts of potential trade disruption.
We believe TriMas Packaging's flexible footprint provides us with multiple alternatives for production to best meet customer requirements and helps mitigate the impacts of potential trade disruption. Marketing, Customers and Distribution TriMas Packaging accesses its markets through direct sales to customers, as well as through leading distributors, where it has enjoyed favorable, long-standing relationships.
Human Capital Resources As of December 31, 2022, we employed approximately 3,500 people, of which 44% were located outside the United States. 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 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 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, life science and industrial markets. We manufacture high-performance, value-added products that are designed to enhance our customers’ ability to store, transport, process and dispense various products.
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.
Changing global dynamics for steel production, supply and pricing may continue to present a challenge to our business. Historically, we have experienced volatility in costs and availability of our raw material purchases and have worked with our suppliers to manage costs and disruptions in supply.
Historically, we have experienced volatility in costs and availability of our raw material purchases and have worked with our suppliers to manage costs and disruptions in supply. We also utilize pricing programs to pass increased steel, resin and other raw material costs on to customers.
Our main brands include Rieke ® , Affaba & Ferrari™, Taplast™, Rapak ® , Intertech and Omega Plastics (reported in Packaging); TriMas Aerospace™, Monogram Aerospace Fasteners™, Allfast ® Fastening Systems, Mac Fasteners™, RSA Engineered Products, Martinic Engineering™ and TFI Aerospace (reported in Aerospace); and Norris Cylinder™ and Arrow ® Engine Company (reported in Specialty Products).
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.
Competitive Strengths We believe TriMas Packaging benefits from the following competitive strengths in coordination with operating under TriMas' overarching strategy: • Strong Product Innovation . 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.
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.
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, and 53 mm and 63 mm diameter child-resistant closures ("CRC") for nutraceutical and agricultural products, which include innovative patent-pending interlocking inner/outer caps designed with less plastic, reducing our carbon footprint without compromising quality, durability or functional performance.
Other innovative offerings include a line of certified flame mitigation closures, as well as our child-resistant closures (CRC) for nutraceutical and agricultural products, which include innovative patent-pending interlocking inner/outer caps designed with less plastic, reducing our carbon footprint without compromising quality, durability or functional performance.
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. Raw materials and other supplies used in our operations are normally available from a variety of competing suppliers.
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.
Our New Product Development teams are also supported by our TriMas Center of Excellence, formerly called the Engineering Resource Center, located in India, to enhance our technical innovation and development. TriMas Packaging has a consistent pipeline of new products ready for launch and continues to innovate to make products more sustainable and environmentally friendly.
TriMas Packaging has a consistent pipeline of new products and enhanced designs ready for launch, and continues to innovate to make products more appealing, sustainable and environmentally friendly.
Our capabilities and products include prototype production molds and custom, medical-related components such as patient diagnostic test components, consumable vascular delivery, surgical devices and pharmaceutical closures. TriMas Packaging has the capability of manufacturing the majority of our products in North America, Europe or Asia, which allows us to evaluate manufacturing location decisions based on customer needs, timing, cost and capacity.
Our capabilities and products include prototype production molds and custom, medical-related components such as patient diagnostic test components, consumable vascular delivery, surgical devices and pharmaceutical closures.
We have five facilities outside of the United States where our employees are affiliated with work councils, which covers 48% of our non-U.S. employees. We believe employee relations throughout our organization are good and we are not aware of any present active union organizing activities at any of our facilities.
We believe employee relations throughout our organization are positive and we are not aware of any present active union organizing activities at any of our facilities. We cannot predict the impact of any further unionization of our workplace.
Arrow Engine is a provider of natural gas powered wellhead engines, compressors and replacement parts, all engineered for use in oil and natural gas production and other industrial and commercial markets. As Arrow's engines can operate from the natural gas produced at the wellhead, we believe Arrow is uniquely positioned to provide its products for remote pump jack installations.
Arrow Engine is a provider of natural gas-powered engines, typically used in remote applications such as for oil field pump jacks, compressors and replacement parts, which are engineered for use in oil and natural gas production and other industrial markets. Arrow Engine distributes its products through a worldwide distribution network, primarily focused in the United States and Canada.
Arrow Engine distributes its products through a worldwide distribution network, primarily focused in the United States and Canada. 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.
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.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeFor example, prior to the outbreak of COVID-19, 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 with historical levels.
Biggest changeFor 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.
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 rising 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, 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.
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; 18 Table of Contents • 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 • Other risks arising out of foreign sovereignty over the areas where our operations are conducted.
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 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.
If our costs under our benefit programs for active employees exceed our projections, our business and financial results could be materially adversely affected. Additionally, foreign competitors and many domestic competitors provide fewer benefits to their employees, and this difference in cost could adversely impact our competitive position. 23 Table of Contents Item 1B. Unresolved Staff Comments Not applicable.
If our costs under our benefit programs for active employees exceed our projections, our business and financial results could be materially adversely affected. Additionally, foreign competitors and many domestic competitors provide fewer benefits to their employees, and this difference in cost could adversely impact our competitive position. 24 Table of Contents Item 1B. Unresolved Staff Comments Not applicable.
While no individual customer accounted for 10% or more of our consolidated net sales for 2022, 2021, or 2020, 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 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.
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.
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.
As of December 31, 2022, 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, 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.
Any significant disruption or slowdown of our systems could cause customers to cancel orders or cause standard business processes to become inefficient or ineffective. 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.
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.
The cost of protecting our intellectual property may be significant and have a material adverse effect on our financial condition and future results of operations. 20 Table of Contents We may incur material losses and costs as a result of product liability, recall and warranty claims brought against us.
The cost of protecting our intellectual property may be significant and have a material adverse effect on our financial condition and future results of operations. We may incur material losses and costs as a result of product liability, recall and warranty claims brought against us.
We have five facilities outside of the United States where our employees are affiliated with state-controlled or trade unions, which covers 48% 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.
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.
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, 2022, we have $394.7 million of outstanding long-term debt. We are subject to variable interest rates on our revolving credit facility.
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.
Of our net sales for the year ended December 31, 2022, 21.8% 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, 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.
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.
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.
We have significant operating 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 2022 under these operating leases was $13.9 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 2023 under these leases was $14.9 million.
Since the outbreak of the COVID-19 pandemic, we have experienced even greater uncertainties in the economic environment, including input cost inflation, supply chain disruptions with our subcontractors and suppliers, shortages in global markets for commodities, logistics and labor, all of which have resulted in labor and manufacturing inefficiencies given the challenges in production scheduling.
In recent years we have experienced even greater uncertainties in the economic environment, including input cost inflation, supply chain disruptions with our subcontractors and suppliers, shortages in global markets for commodities, logistics and labor, all of which have resulted in labor and manufacturing inefficiencies given the challenges in production scheduling.
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 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.
In 2022, our Aerospace and Specialty Products segments each had customers 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 may expose our business and results of operations to greater volatility.
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.
Any adopted future regulations could also negatively impact our ability to compete with companies situated in areas not subject to such limitations, and we may not be able to recover the cost of compliance with new or more stringent laws and regulations, which could adversely impact our results of operations, cash flow or financial condition. 21 Table of Contents Our reputation, ability to do business, and results of operations may be impaired by legal compliance risks.
Any adopted future regulations could also negatively impact our ability to compete with companies situated in areas not subject to such limitations, and we may not be able to recover the cost of compliance with new or more stringent laws and regulations, which could adversely impact our results of operations, cash flow or financial condition.
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, 2022, our goodwill and intangible assets were $527.9 million and represented 40.5% 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, 2023, our goodwill and intangible assets were $544.8 million and represented 40.6% of our total assets.
A failure to pay our rental obligations would constitute a default allowing the applicable landlord to pursue any remedy available to it under applicable law, which would include taking possession of our property and, in the case of real property, evicting us. These leases are categorized as operating leases and are not considered indebtedness for purposes of our debt instruments.
A failure to pay our rental obligations would constitute a default allowing the applicable landlord to pursue any remedy available to it under applicable law, which would include taking possession of our property and, in the case of real property, evicting us.
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.
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.
We may experience increases in our interest expense as a result of general increases in interest rate levels. In addition, we could be further impacted by changes in variable interest rates.
The interest rate spread is based upon the leverage ratio, as defined, as of the most recent determination date. We may experience increases in our interest expense as a result of general increases in interest rate levels. In addition, we could be further impacted by changes in variable interest rates.
Total settlement costs (exclusive of defense costs) for all such cases, some of which were filed over 25 years ago, have been $12.5 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.
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.
Our revolving credit facility and the indenture governing our senior notes contain covenants that restrict our ability to: • pay dividends or redeem or repurchase capital stock; • incur additional indebtedness and grant liens; • make acquisitions and joint venture investments; and • sell assets. 22 Table of Contents Our debt instruments also require us to comply with financial covenants relating to, among other things, interest coverage and leverage.
Our revolving credit facility and the indenture governing our senior notes contain covenants that restrict our ability to: • Pay dividends or redeem or repurchase capital stock; • Incur additional indebtedness and grant liens; • Make acquisitions and joint venture investments; and • Sell assets.
Any failure, or perceived failure, by us to achieve our sustainability or ESG goals and initiatives, adhere to our public statements, comply with federal, state or international laws and regulations, meet evolving and varied stakeholder expectations and standards or accurately disclose our progress on such matters, could expose us to potential liabilities, increased costs, reputational harm and other adverse effects on our business. 19 Table of Contents 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.
Any failure, or perceived failure, by us to achieve our sustainability or ESG goals and initiatives, adhere to our public statements, comply with federal, state or international laws and regulations, meet evolving and varied stakeholder expectations and standards, or accurately disclose our progress on such matters, could expose us to potential liabilities, increased costs, reputational harm and other adverse effects on our business.
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.
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.
We may not be able to satisfy these covenants in the future or be able to pursue our strategies within the constraints of these covenants. Substantially all of the assets of our domestic subsidiaries are pledged as collateral.
Our debt instruments also require us to comply with financial covenants relating to, among other things, interest coverage and leverage. We may not be able to satisfy these covenants in the future or be able to pursue our strategies within the constraints of these covenants. Substantially all of the assets of our domestic subsidiaries are pledged as collateral.
A failure by our suppliers to continue to supply us with certain raw materials, component parts, or at all, could have a material adverse effect on us.
A failure by our suppliers to continue to supply us with certain raw materials, component parts, or at all, could have a material adverse effect on us. To the extent there are energy supply disruptions or material fluctuations in energy costs, our margins could be materially adversely impacted.
Increases in our raw material or energy costs or the loss of critical suppliers could adversely affect our profitability and other financial results. We are sensitive to price movements in our raw materials supply base. Our largest material purchases are for resins (such as polypropylene and polyethylene), steel, aluminum and other metal and non-metal-based purchased components.
Increases in our raw material or energy costs or the loss of critical suppliers could adversely affect our profitability and other financial results. We are sensitive to price movements and availability of our raw materials supply.
Our reference rates under our revolving credit facility may perform differently from the historical use of U.S. dollar LIBOR, which may affect our net interest expense and require changes to our future risk, pricing and hedging strategies. We had no amounts outstanding under our revolving credit facility as of December 31, 2022.
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.
The loss of the services of any of our key employees or the failure to retain or attract employees could have a material adverse effect on us. We may be subject to further unionization and work stoppages at our facilities or our customers may be subject to work stoppages, which could seriously impact the profitability of our business.
We may be subject to further unionization and work stoppages at our facilities or our customers may be subject to work stoppages, which could seriously impact the profitability of our business.
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 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.
In addition, we have experienced, and expect to continue to experience, the impact of cost inflationary pressure on raw materials, wage rates and freight. We have generally been able to recover such costs during 2022, as market prices have generally stabilized.
For example, during 2022, we experienced increased energy costs and supply chain disruptions as a result of the Russia-Ukraine conflict. In addition, we have experienced, and expect to continue to experience, the impact of cost inflationary pressure on raw materials, wage rates and freight.
Our business leadership teams have served a vast majority of their careers in, and are deeply experienced in, the industries we operate. Our future success will also depend on, among other factors, our ability to retain or attract other qualified personnel.
Our success will depend, in part, on the efforts of our key leadership, including key operational, technical, commercial, manufacturing and financial personnel. Our business leadership teams have served a vast majority of their careers in, and are deeply experienced in, the industries we operate.
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.
We may be subject to claims or inquiries regarding alleged unauthorized use of a third party’s intellectual property.
In the past, our operations have been exposed to volatility due to changes in general economic conditions or consumer preferences, recessions or adverse conditions in the markets we serve, including the impact of global pandemics, such as the coronavirus and related variants ("COVID-19"), and the Russia-Ukraine conflict.
Our financial performance depends, in large part, on conditions in the markets that we serve in both the U.S. and globally. In the past, our operations have been exposed to volatility due to changes in general economic conditions or consumer preferences, recessions or adverse conditions in the markets we serve, including the impact of global pandemics and international conflicts.
To the extent there are energy supply disruptions or material fluctuations in energy costs, our margins could be materially adversely impacted. 16 Table of Contents Our ability to deliver products that satisfy customer requirements is dependent on the performance of our subcontractors and suppliers, as well as on the availability of raw materials and other components.
Our ability to deliver products that satisfy customer requirements is dependent on the performance of our subcontractors and suppliers, as well as on the availability of raw materials and other components.
The concentration of our customer base also increases our risks related to the financial condition of our customers, and the deterioration in financial condition of customers or the failure of customers to perform their obligations could have a material adverse effect on our results of operations and cash flows. 17 Table of Contents We are dependent on our manufacturing facilities for the production of our highly engineered products, which subjects us to risks associated with disruptions and changing technology and manufacturing techniques that could place us at a competitive disadvantage.
The concentration of our customer base also increases our risks related to the financial condition of our customers, and the deterioration in financial condition of customers or the failure of customers to perform their obligations could have a material adverse effect on our results of operations and cash flows.
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. The COVID-19 pandemic has adversely impacted, and continues to pose risks, to our businesses, the nature and extent of which are highly uncertain and unpredictable.
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.
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 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.
Of the 4,798 claims pending at December 31, 2022, 45 set forth specific amounts of damages (other than those stating the statutory minimum or maximum). See Note 16, " Commitments and Contingencies ," included in Item 8, " Financial Statements and Supplementary Data ," within this Form 10-K for additional information.
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).
Human Capital Risks We depend on the services of key individuals and relationships, the loss of which could materially harm us. Our success will depend, in part, on the efforts of our key leadership, including key operational, technical, commercial, manufacturing and financial personnel.
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.
Such interest rates, effective January 1, 2022, are based on the Secured Overnight Financing Rate, the Sterling Overnight Index Average and the Euro Short Term Rate depending upon the currency of borrowing, all plus a spread of 1.50%. The interest rate spread is based upon the leverage ratio, as defined, as of the most recent determination date.
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%.
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Our financial performance depends, in large part, on conditions in the markets that we serve in both the U.S. and globally.
Added
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.
Removed
For example, a number of our consumer packaged goods customers increased their first-half 2022 orders for our products due to concerns over capacity constraints and rising inflation, and significantly reduced their orders in the back half of 2022, alerting us that they need to sell through a substantial portion of their existing inventory levels prior to placing significant additional orders.
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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.
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We have been managing matters related to the global outbreak of the COVID-19, including impacts to our operations and strategic supplier-partners in Asia, as well as our manufacturing operations in Europe and North America since early 2020.
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For 2023, material and other input costs have decreased from 2022 levels, primarily in our Packaging segment, although pressure on wage rates remain.
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The COVID-19 pandemic has impacted our results of operations, and we expect it will continue to impact us in the future at varying levels. For example, sales for our dispensing and closure products used to help fight the spread of gems significantly increased in 2020 and 2021, and receded in 2022.
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Sales of our consumer and industrial packaging products decreased in 2023, which we believe was due to lower customer order activity given high customer stocking levels, as well as continuing uncertainty around consumer sentiment as a result of the inflationary environment.
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Sales in our Aerospace segment significantly declined at the onset of the pandemic, and have increased in 2022 as air travel and new aircraft production increases.
Added
We are dependent on our manufacturing facilities for the production of our highly-engineered products, which subjects us to risks associated with disruptions and changing technology and manufacturing techniques that could place us at a competitive disadvantage.
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The primary impacts on our business to date have been related to (i) shifting customer demand for many of our products, including those used in cosmetic, personal care, pharmaceutical, home care, food and beverage, and industrial markets, as well as aerospace markets; (ii) delays and disruptions in the availability of and timely delivery of materials and components used in our operations, as well as increased costs for such materials and components; and (iii) reduced availability and productivity of employees.
Added
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.
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The extent of the COVID-19 pandemic's effect on our operational and financial performance will depend in large part on future developments, which cannot be predicted with confidence at this time.
Added
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.
Removed
Future developments include the duration, scope and severity of the pandemic, the actions taken to contain or mitigate its ongoing impact in the regions in which we do business, and any future impacts on widespread economic activity, including air travel.
Added
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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The emergence of new variants of COVID-19, evolving governmental plans to institute vaccination mandates and limited availability of vaccines in various jurisdictions create uncertainty that may impact our employees and result in labor shortages and unforeseen costs.
Added
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.
Removed
In addition, because we cannot predict the impact that COVID-19 or other global pandemics will ultimately have, the actual impact may also exacerbate other risks discussed in this Item 1A. 15 Table of Contents Many of the markets we serve are highly competitive, which could limit sales volumes and reduce our operating margins.
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Our reputation, ability to do business, and results of operations may be impaired by legal compliance risks.
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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, and we will have a greater dependency on remaining businesses for our financial results.
Added
Our future success will also depend on, among other factors, our ability to retain or attract other qualified personnel. The loss of the services of any of our key employees or the failure to retain or attract employees could have a material adverse effect on us.
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Prices for these products, along with costs for transportation and energy, fluctuate with market conditions, and have generally increased over time. For example, during 2022, we experienced increased energy costs and supply chain disruptions as a result of the Russia-Ukraine conflict.
Removed
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.

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, 2022: Packaging Aerospace Specialty Products United States: Alabama Huntsville Arkansas Atkins (1) Arizona Mesa (1) Tolleson California Irwindale (1) Rohnert Park (1) City of Industry Commerce (1) Simi Valley (1) 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: Canada Orangeville (1) China Haining City (1) Hangzhou (1) Germany Neunkirchen India Baddi New Delhi (1) Italy Borgo San Giovanni (1) Forli Pieve Fissiraga (1) Povolaro Mexico San Miguel de Allende (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, 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.
The leases for our manufacturing facilities have terms that expire from 2023 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 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.
All such leases are operating leases. 24 Table of Contents Item 3. Legal Proceedings See Note 16, " Commitments and Contingencies " included in Item 8, " Financial Statements and Supplementary Data ," within this Form 10-K.
All such leases are operating leases. 27 Table of Contents Item 3. Legal Proceedings See Note 15, " Commitments and Contingencies " included in Item 8, " Financial Statements and Supplementary Data ," within this Form 10-K.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. Legal Proceedings 25 Item 4. Mine Safety Disclosures 25 Supplementary Item. Information about our Executive Officers 25 PART II. Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 26 Item 6. [Reserved] 27 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 28 Item 7A.
Biggest changeItem 3. Legal Proceedings 28 Item 4. Mine Safety Disclosures 28 Supplementary Item. Information about our Executive Officers 28 PART II. Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 29 Item 6. [Reserved] 30 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 31 Item 7A.
Quantitative and Qualitative Disclosures About Market Risk 43 Item 8. Financial Statements and Supplementary Data 44
Quantitative and Qualitative Disclosures About Market Risk 46 Item 8. Financial Statements and Supplementary Data 47

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeMell’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. Fabio L. Matheus Salik. Mr. Salik, age 54, was appointed President of TriMas Packaging in July 2020. He has more than 20 years of global management experience working for a variety of plastic packaging companies.
Biggest changeMell’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.
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 51, 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 52, was appointed the Company's Chief Financial Officer in May 2021. Prior to joining the Company, Mr.
Item 4. Mine Safety Disclosures Not applicable. Supplementary Item. Information about our Executive Officers As of December 31, 2022, the following were executive officers of the Company: Thomas A. Amato. Mr. Amato, age 59, was appointed the Company's President and Chief Executive Officer in July 2016.
Item 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.
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From 2012 to 2020, he worked for Logoplaste, a Carlyle Group-owned company which is headquartered in Portugal. In his last assignment as CEO of Americas from July 2017 to May 2020, and as Chief Operating Officer from December 2016 to July 2017, Mr.
Added
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.
Removed
Salik had full P&L responsibility for more than 20 facilities, servicing blue-chip consumer packaged goods companies including P&G, Nestle, L’Oreal, Dannon, Reckitt Benckiser and Henkel. Prior to his tenure at Logoplaste, he was President of Valmari, a Brazilian skincare company.
Added
Prior to joining the Company, Ms. Robin was an attorney with Reed Smith LLP in Chicago, Illinois. 28 Table of Contents PART II
Removed
He also worked for Rexam in the United States, France and Brazil, where he served in a number of roles of increasing responsibility, including positions such as Managing Director worldwide for Rexam Make Up and Managing Director worldwide for Rexam Healthcare - Primary Packaging and Prescription Divisions. John P. Schaefer. Mr.
Removed
Schaefer, age 51, was appointed President of TriMas Aerospace in December 2016. Previously, he served in various strategic advisory capacities for private equity firms focused in the Aerospace & Defense industry. From 2010 through 2015, he served in operations and general management executive roles with TransDigm Group.
Removed
Prior to his leadership roles at TransDigm, he served from 2005 through 2009 as an operating executive with Meggitt PLC. Mr. Schaefer is also a 22-year veteran and retired as a Lieutenant Colonel of the United States Marine Corps. 25 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePeriod 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 (1) October 1, 2022 to October 31, 2022 28,231 $ 25.47 28,231 $ 111,938,743 November 1, 2022 to November 30, 2022 58,400 $ 25.04 58,400 $ 110,476,558 December 1, 2022 to December 31, 2022 173,303 $ 27.59 173,303 $ 105,694,663 Total 259,934 $ 26.79 259,934 $ 105,694,663 __________________________ (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.
Biggest changePeriod 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.
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 2022 and 2021 were $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 2023, 2022 and 2021 were $6.7 million, $6.9 million and $1.7 million, respectively.
See the discussion under Item 7, " Management's Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources" and Note 19 to the Company's financial statements captioned " Earnings per Share," included in Item 8, " Financial Statements and Supplementary Data ," within this Form 10-K.
See the discussion under Item 7, " Management's Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources" and Note 18 to the Company's financial statements captioned " Earnings per Share," included in Item 8, " Financial Statements and Supplementary Data ," within this Form 10-K.
Performance Graph The following graph compares the cumulative total stockholder return from December 31, 2017 through December 31, 2022 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, 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.
The graph assumes that $100 was invested on December 31, 2017 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. 26 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, 2022.
The 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.
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, 2023, there were 153 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 22, 2024, there were 138 holders of record of our common stock.
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, 2022, the Company repurchased 259,934 shares of its common stock at a cost of $7.0 million. The share repurchase program is effective and has no expiration date.
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 changeResults of Operations Year Ended December 31, 2022 Compared with Year Ended December 31, 2021 The principal factors impacting us during the year ended December 31, 2022, compared with the year ended December 31, 2021 were: • the significant level of uncertainty and volatility in the markets we serve, whether impacted by the COVID-19 pandemic, the Russia-Ukraine conflict or other general inflationary pressures; • reduced sales of our Packaging segment's products used in beauty and personal care and home care applications as a result of the abatement from peak demand levels following the pandemic, as well from an abrupt second-half 2022 demand reduction from large consumer packaged goods customers due to their choice to rebalance inventory levels; • increases in sales in our Specialty Products segment as a result of a significant increase in industrial demand in 2022; • the impact of recent acquisitions, primarily Omega and TFI in December 2021, and Intertech in February 2022; • gains on the sale of non-core properties in City of Industry, California and Tolleson, Arizona; • the impact of higher energy costs; • expenses associated with our asbestos exposure to update the liability to recent actuarial studies; • realignment expenses in response to reduced end-market demand following the outbreak of the COVID-19 pandemic; • the impact of our debt refinancing activities; and • the impact of a increase in our effective tax rate from 2021 to 2022.
Biggest changeResults of Operations Year Ended December 31, 2023 Compared with Year Ended December 31, 2022 The principal factors impacting us during the year ended December 31, 2023, compared with the year ended December 31, 2022 were: • Significant demand reductions for products in certain end markets within our Packaging segment; • Significant demand increases in our Aerospace and Specialty Products segments, particularly in the first half of 2023; • Significant gains on the sale of non-core properties in City of Industry, California, and Tolleson, Arizona, in 2022, which did not repeat in 2023; • The impact of recent acquisitions, primarily Intertech in February 2022, Aarts in February 2023 and Weldmac in April 2023; • Improved manufacturing throughput in our Aerospace segment; • Decreased material and other input costs in our Packaging segment; • Realignment expenses in response to changes in end market demand; • Higher business diligence and consulting fees in support of our growth initiatives; • The third quarter 2022 termination of our existing cross-currency swaps; and • A decrease in our effective tax rate in 2023 compared with 2022.
We expect to continue to leverage the tenets of our TriMas Business Model to manage our multi-industry businesses on a longer-term basis, to 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.
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.
The liability related to unrecognized tax benefits has been excluded from the contractual obligations table because a reasonable estimate of the timing and amount of cash flows from future tax settlements cannot be determined. For additional information, refer to Note 22, " Income Taxes ," included in Item 8, " Financial Statements and Supplementary Data ," within this Form 10-K.
The liability related to unrecognized tax benefits has been excluded from the contractual obligations table because a reasonable estimate of the timing and amount of cash flows from future tax settlements cannot be determined. For additional information, refer to Note 21, " Income Taxes ," included in Item 8, " Financial Statements and Supplementary Data ," within this Form 10-K.
See Note 13, " Derivative Instruments ," included in Item 8, " Financial Statements and Supplementary Data ," within this Form 10-K for additional information. We are also subject to interest risk as it relates to our long-term debt. We have historically used interest rate swap agreements to fix the variable portion of our debt to manage this risk.
See Note 12, " Derivative Instruments ," included in Item 8, " Financial Statements and Supplementary Data ," within this Form 10-K for additional information. We are also subject to interest risk as it relates to our long-term debt. We have historically used interest rate swap agreements to fix the variable portion of our debt to manage this risk.
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 2022 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 2023 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, 2022. 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, 2023. We present Consolidated Bank EBITDA to show our performance under our financial covenants. Dollars are in thousands in the below tables.
We serve customers in industries that are highly competitive, cyclical and that may be significantly impacted by changes in economic or geopolitical conditions.
We serve customers in industries that are highly competitive and that may be significantly impacted by changes in economic or geopolitical conditions.
Our permitted total net leverage ratio under the Credit Agreement is 4.00 to 1.00 as of December 31, 2022. 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, 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.
The $5.1 million of fees and expenses related to the 2029 Senior Notes were capitalized as debt issuance costs, while the $7.3 million redemption premium, as well as $3.0 million of unamortized debt issuance costs associated with the 2025 Senior Notes were recorded as expense within debt financing and related expenses in the accompanying consolidated statement of operations.
The $5.1 million of fees and expenses related to the 2029 Senior Notes were capitalized as debt issuance costs, while the $7.3 million redemption premium, as well as $3.0 million of unamortized debt issuance costs associated with the 2025 Senior Notes were recorded as expense within debt financing and related expenses in the accompanying consolidated statement of income.
We utilize known facts and historical trends, as well as actuarial valuations in determining estimated required reserves. Changes in assumptions for factors such as medical costs and actual experience could cause these estimates to change significantly. 42 Table of Contents
We utilize known facts and historical trends, as well as actuarial valuations in determining estimated required reserves. Changes in assumptions for factors such as medical costs and actual experience could cause these estimates to change significantly. 45 Table of Contents
The terms and conditions of any incremental revolving credit facility commitments must be no more favorable than the existing credit facility. 36 Table of Contents Amounts drawn under our revolving credit facility fluctuate daily based upon our working capital and other ordinary course needs.
The terms and conditions of any incremental revolving credit facility commitments must be no more favorable than the existing credit facility. 39 Table of Contents Amounts drawn under our revolving credit facility fluctuate daily based upon our working capital and other ordinary course needs.
The future interest obligations calculation excludes the impact of our cross-currency swap agreements. See Note 13, " Derivative Instruments ," included in Item 8, " Financial Statements and Supplementary Data ," within this Form 10-K for additional information.
The future interest obligations calculation excludes the impact of our cross-currency swap agreements. See Note 12, " Derivative Instruments ," included in Item 8, " Financial Statements and Supplementary Data ," within this Form 10-K for additional information.
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. 41 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. 44 Table of Contents Asbestos-related Matters.
While the majority of our revenue is in the United States, we manufacture and supply products globally to a wide range of companies. We report our business activity in three segments: Packaging, Aerospace and Specialty Products. Key Factors Affecting Our Reported Results Our businesses and results of operations depend upon general economic conditions.
While the majority of our revenue is in the United States, we manufacture and supply products globally to a wide range of companies. We report our business activity in three segments: Packaging, Aerospace and Specialty Products. Key Factors Affecting Our Reported Results Demand for the products our businesses produce and results of operations depend upon general economic conditions.
We expect leasing will continue to be an available financing option to fund future capital expenditure requirements. 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.
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.
These include payments under our long-term debt agreements, rent payments required under operating 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, 2022 (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, 2023 (dollars in thousands).
Although we have escalator/de-escalator clauses in commercial contracts with certain of our customers, or can modify prices based on market conditions to recover higher costs, our price increases generally lag the underlying material cost increase, and we cannot be assured of full cost recovery in the open market.
Although we have escalator/de-escalator clauses in commercial contracts with certain of our customers to address fluctuations in input costs, or can modify prices based on market conditions to recover higher costs, our price increases generally lag the underlying input cost increase, and we cannot be assured of full cost recovery in the open market.
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, 2021, we had no amounts outstanding under our revolving credit facility and had $300.0 million potentially available.
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.
However, no matter the outcome of these factors, we expect to continue to mitigate, as much as practical, the impact of these challenges, executing on realignment actions and taking other proactive actions as necessary, to maintain our strong balance sheet and generate cash in support of our capital allocation strategy.
However, no matter the outcome of these factors, we expect to continue to mitigate, as much as practical, the impact of these challenges, executing on streamlining actions and taking other steps as necessary, to maintain our strong balance sheet and generate cash in support of our capital allocation strategy.
We believe our businesses share important and distinguishing characteristics, including: well-recognized and leading brand names in the focused markets we serve; innovative product technologies and features; a high-degree of customer approved processes and qualifications; established distribution networks; relatively low ongoing capital investment requirements; strong cash flow conversion and long-term growth opportunities.
We believe our businesses share important and distinguishing characteristics, including: well-recognized and leading brand names in the markets we serve; innovative product technologies and features; a high-degree of customer approved processes and qualifications; established distribution networks; modest capital investment requirements; strong cash flow conversion and long-term growth opportunities.
Accruals for asbestos-related matters are included in the consolidated balance sheet in “Accrued liabilities” and “Other long-term liabilities.” Other Loss Reserves. We have other loss exposures related to insurance, litigation and environmental claims. Establishing loss reserves for these matters requires the use of estimates and judgment in regard to risk exposure and ultimate liability.
Accruals for asbestos-related matters are included in the consolidated balance sheet in "Accrued liabilities" and "Other long-term liabilities." Other Loss Reserves. We have other loss exposures related to insurance, litigation and environmental claims. Establishing loss reserves for these matters requires the use of estimates and judgment in regard to risk exposure and ultimate liability.
Our letters of credit, or corresponding restricted cash deposits, are used for a variety of purposes, including support of certain operating lease agreements, vendor payment terms and other subsidiary operating activities, and to meet various states' requirements to self-insure workers' compensation claims, including incurred but not reported claims.
Our letters of credit are used for a variety of purposes, including support of certain operating lease agreements, vendor payment terms and other subsidiary operating activities, and to meet various states' requirements to self-insure workers' compensation claims, including incurred but not reported claims.
In 2022, our consolidated subsidiaries that do not guarantee the Senior Notes represented 24% 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 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.
On March 29, 2022, Moody's affirmed a Ba3 rating to our 2029 Senior Notes, as presented in Note 12, "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 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.
A discussion regarding our financial condition and results of operations for the year ended December 31, 2021 compared to the year ended December 31, 2020 can be found under Item 7 in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, filed with the Securities and Exchange Commission on March 1, 2022.
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.
As of December 31, 2022, we were party to foreign exchange forward and swap contracts to hedge changes in foreign currency exchange rates with notional amounts of $127.2 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, 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.
We will continue to evaluate opportunities to return capital to shareholders through the purchase of our common stock, depending on market conditions, including the potential impact of the COVID-19 pandemic, 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. Under various agreements, we are obligated to make future cash payments in fixed amounts.
Our days accounts payable on hand remained consistent through 2022 and increased by five days through 2021. 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 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.
In addition, in 2022 , we declared quarterly dividends of $0.04 per share of common stock, aggregating to dividends declared and paid on common shares during 2022 of $6.9 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.
On May 12, 2022, 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 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.
Receivables are presented net of allowances for doubtful accounts of $1.7 million and $1.6 million at December 31, 2022 and 2021, 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 $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.
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 ("COVID-19") 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).
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.
In addition, our non-guarantor subsidiaries represented 37% and 14% of the total guarantor and non-guarantor assets and liabilities, respectively, as of December 31, 2022, treating the guarantor and non-guarantor subsidiaries each as a consolidated group.
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.
Our actual total net leverage ratio was 1.86 to 1.00 at December 31, 2022. Our permitted interest expense coverage ratio under the Credit Agreement is 3.00 to 1.00, and our actual interest expense coverage ratio was 12.72 to 1.00 as of December 31, 2022. At December 31, 2022, we were in compliance with our financial covenants.
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.
We 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. 30 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, 2022 As a Percentage of Net Sales 2021 As a Percentage of Net Sales 2020 As a Percentage of Net Sales Net Sales Packaging $ 522,180 59.1 % $ 533,260 62.2 % $ 488,340 63.4 % Aerospace 188,090 21.3 % 183,340 21.4 % 167,740 21.8 % Specialty Products 173,560 19.6 % 140,510 16.4 % 113,890 14.8 % Total $ 883,830 100.0 % $ 857,110 100.0 % $ 769,970 100.0 % Gross Profit Packaging $ 137,030 26.2 % $ 145,750 27.3 % $ 142,410 29.2 % Aerospace 32,240 17.1 % 39,970 21.8 % 27,020 16.1 % Specialty Products 39,030 22.5 % 31,470 22.4 % 12,650 11.1 % Total $ 208,300 23.6 % $ 217,190 25.3 % $ 182,080 23.6 % Selling, General and Administrative Packaging $ 55,670 10.7 % $ 49,110 9.2 % $ 47,850 9.8 % Aerospace 28,990 15.4 % 26,690 14.6 % 25,550 15.2 % Specialty Products 8,680 5.0 % 8,950 6.4 % 7,890 6.9 % Corporate expenses 37,850 N/A 37,220 N/A 53,190 N/A Total $ 131,190 14.8 % $ 121,970 14.2 % $ 134,480 17.5 % Operating Profit (Loss) Packaging $ 81,000 15.5 % $ 96,490 18.1 % $ 93,990 19.2 % Aerospace 8,060 4.3 % 13,270 7.2 % (133,440) (79.6) % Specialty Products 30,250 17.4 % 22,550 16.0 % 4,350 3.8 % Corporate (20,250) N/A (37,220) N/A (53,190) N/A Total $ 99,060 11.2 % $ 95,090 11.1 % $ (88,290) (11.5) % Capital Expenditures Packaging $ 33,170 6.4 % $ 34,080 6.4 % $ 30,730 6.3 % Aerospace 6,900 3.7 % 5,390 2.9 % 5,770 3.4 % Specialty Products 5,860 3.4 % 5,500 3.9 % 3,890 3.4 % Corporate 30 N/A 90 N/A 90 N/A Total $ 45,960 5.2 % $ 45,060 5.3 % $ 40,480 5.3 % Depreciation Packaging $ 22,720 4.4 % $ 20,950 3.9 % $ 18,330 3.8 % Aerospace 7,590 4.0 % 7,140 3.9 % 7,110 4.2 % Specialty Products 3,680 2.1 % 3,670 2.6 % 3,450 3.0 % Corporate 130 N/A 130 N/A 130 N/A Total $ 34,120 3.9 % $ 31,890 3.7 % $ 29,020 3.8 % Amortization Packaging $ 6,620 1.3 % $ 9,550 1.8 % $ 9,270 1.9 % Aerospace 12,030 6.4 % 11,560 6.3 % 11,020 6.6 % Specialty Products 450 0.3 % 450 0.3 % 460 0.4 % Corporate — N/A — N/A — N/A Total $ 19,100 2.2 % $ 21,560 2.5 % $ 20,750 2.7 % 31 Table of Contents The following “Results of Operations Year Ended December 31, 2022 Compared with Year Ended December 31, 2021” section presents an analysis of our consolidated operating results displayed in the Consolidated Statement of Operations.
We 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.
The changes in 2022 and 2021 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 $29.1 million in 2022, while increases in accounts payable and accrued liabilities resulted in a source of cash of $2.1 million in 2021.
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.
We also purchased $19.1 million of outstanding common stock, used a net cash amount of $5.2 million related to our stock compensation arrangements and paid dividends of $1.7 million. 35 Table of Contents Our Debt and Other Commitments In March 2021, we issued the 2029 Senior Notes in a private placement under Rule 144A of the Securities Act of 1933, as amended.
During 2022, we purchased $36.9 million of outstanding common stock, used a net cash amount of $2.4 million related to our stock compensation arrangements and paid dividends of $6.9 million. 38 Table of Contents Our Debt and Other Commitments In March 2021, we issued the 2029 Senior Notes in a private placement under Rule 144A of the Securities Act of 1933, as amended.
However, as a result of the current period of macroeconomic inflation and uncertainty, the continued impact of the COVID-19 pandemic, and the potential impact of such factors to our future results of operations, as well 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 as well as for uncollectible customer account balances, excess inventory and idle production equipment.
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.
Altogether, this significant level of volatility in demand levels, input costs and supply chain availability, as well as internal labor availability, all have pressured our ability to operate efficiently and at historical margin levels. Overall, 2022 net sales increased $26.7 million, or 3.1%, compared to 2021.
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.
We will continue to take actions to mitigate such increases, including implementing commercial pricing adjustments, resourcing to alternate suppliers and insourcing of previously sourced products to better leverage our global manufacturing footprint.
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.
Net cash used for investing activities was $55.0 million and $79.2 million in 2022 and 2021, respectively. During 2022, we paid $64.1 million, net of cash acquired, to acquire Intertech. We invested $46.0 million in capital expenditures as we have continued our investment in growth, capacity and productivity-related capital projects.
Net cash used for investing activities was $134.4 million and $55.0 million in 2023 and 2022, respectively. During 2023, we paid $77.3 million, net of cash acquired, to acquire Aarts and Weldmac. We invested $54.2 million in capital expenditures as we have continued our investment in growth, capacity and productivity-related capital projects.
In addition, net sales decreased $17.9 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. Gross profit margin (gross profit as a percentage of sales) approximated 23.6% and 25.3% in 2022 and 2021, respectively.
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.
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.
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.
Other 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, expand our geographic coverage or enable better absorption of overhead costs; 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.
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.
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 over the past year, and in the second half of 2022 demand abruptly falling as a result of some of our large consumer goods customers' choices to rebalance on-hand inventory levels given the current 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, 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.
During 2022, 2021 and 2020, we purchased 1,264,088, 596,084 and 1,582,049 shares of our outstanding common stock for $36.9 million, $19.1 million and $39.4 million, respectively. Since the initial authorization through December 31, 2022, we have purchased 5,114,903 shares of our outstanding common stock for an aggregate purchase price of $144.3 million.
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.
Our days sales in inventory increased by seven days in 2022, primarily as a result of proactively investing in certain raw materials and purchased components to protect against supply chain disruptions and potential cost increases.
Our days sales in inventory increased by seven days in 2022, primarily as a result of proactively investing in certain raw materials and purchased components to protect against supply chain disruptions and potential cost increases . • Decreases in prepaid expenses and other assets resulted in a source of cash of $4.8 million and $6.1 million in 2023 and 2022, respectively.
Our stock trades under the symbol "TRS." 39 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." 42 Table of Contents Credit Rating We and certain of our outstanding debt obligations are rated by Standard & Poor's and Moody's.
Given the short-cycle nature of most of our businesses, we do not consider sales order backlog to be a material factor. A growing amount of our sales is derived from international sources, which exposes us to certain risks, including currency risks. We are sensitive to price movements and availability of our raw materials supply.
A growing amount of our sales is derived from international sources, which exposes us to certain risks, including currency risks. We are sensitive to price movements and availability of our raw materials supply.
During 2022 , we purchased 1,264,088 shares of our outstanding common stock for an aggregate purchase price of $36.9 million . As of December 31, 2022 , we had $105.7 million remaining under the repurchase authorization.
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.
Significant changes in cash flows provided by operating activities and the reasons for such changes are as follows: • 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 non-cash items related to depreciation, amortization, (gain) loss on dispositions of assets, changes in deferred income taxes, stock-based compensation, change in legacy liability estimate, and other operating activities.
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.
In 2021, the Company generated $139.2 million in cash flows based on the reported net income of $57.3 million and after considering the effects of similar non-cash items and debt financing and related expenses. • Increases in accounts receivable resulted in a use of cash of $6.7 million and $11.2 million in 2022 and 2021, respectively.
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.
The majority of our cash on hand as of December 31, 2022 is located within the United States, and given available funding under our revolving credit facility of $300.0 million at December 31, 2022 (after consideration of the aforementioned leverage restrictions) and based on forecasted cash sources and requirements inherent in our business plans, we believe that our liquidity and capital resources, including anticipated cash flows from operations, will be sufficient to meet our debt service, capital expenditure and other short-term and long-term obligation needs for the next 12 months and for the foreseeable future, as well as dividends and share repurchases.
Based on forecasted cash sources and requirements inherent in our business plans, we believe that our liquidity and capital resources, including anticipated cash flows from operations, will be sufficient to meet our debt service, capital expenditure and other short-term and long-term obligation needs for the next 12 months and for the foreseeable future, as well as dividends and share repurchases.
Selling, general and administrative expenses within Specialty Products decreased $0.3 million to $8.7 million, or 5.0% of sales, in 2022, as compared to $9.0 million, or 6.4% of net sales, in 2021, primarily due to lower employee-related costs.
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.
We account for these lease transactions as operating leases, and incurred rent expense for continuing operations related thereto of $13.9 million in 2022. We continue to be party to non-cancelable leases for certain facilities we have exited as part of restructuring activities, and have entered into sublease agreements to minimize our net lease payments.
We continue to be party to non-cancelable leases for certain facilities we have exited as part of restructuring activities, and have entered into sublease agreements to minimize our net lease payments.
We recorded income tax expense of $21.5 million in 2022, as compared to income tax expense of $11.8 million in 2021. During 2022, we reported domestic and foreign pre-tax income of $56.8 million and $30.9 million, respectively, as compared to a domestic and foreign pre-tax income of $28.4 million and $40.7 million in 2021.
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.
Sales of products used in industrial markets decreased by $3.6 million, primarily as a result of lower demand for drum and pail closure products in North America.
Sales of products used in industrial markets decreased by $22.2 million, primarily as a result of lower demand for drum and pail closure products. Sales of dispensing products used in personal care and home care applications decreased by $27.1 million.
Net sales decreased by $17.9 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, as compared to 2021.
These decreases were partially offset by an increase in net sales of $1.7 million due to currency exchange, as our reported results in U.S. dollars were favorably impacted as a result of the weakening of the U.S. dollar relative to foreign currencies, as compared to 2022.
Our borrowing capacity was not reduced by leverage restrictions contained in the Credit Agreement as of December 31, 2022 and December 31, 2021. We rely upon our cash flow from operations and available liquidity under our revolving credit facility to fund our debt service obligations and other contractual commitments, working capital and capital expenditure requirements.
We rely upon our cash flow from operations and available liquidity under our revolving credit facility to fund our debt service obligations and other contractual commitments, working capital and capital expenditure requirements.
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. The facility is guaranteed by TriMas Corporation. There were no borrowings on this loan facility as of December 31, 2022 and 2021. 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, 2023, and 2022. Cash management related to our revolving credit facility is centralized.
Sales of certain of our industrial and aerospace-related products were significantly depressed from historical levels during 2020 and 2021, but demand has significantly increased in 2022, to where the industrial demand in our Specialty Products segment has rebounded to pre-pandemic levels, while demand in our Aerospace segment continues to increase (and more quickly than expected) as air travel has picked-up and new aircraft build rates improve.
Sales of certain of our aerospace-related products were significantly depressed from historical levels following the onset of the pandemic, but demand has significantly increased in recent quarters as air travel has picked-up and new aircraft build rates improve.
Year ended December 31, 2022 Net income $ 66,170 Bank stipulated adjustments: Interest expense, net (as defined) 14,110 Income tax expense 21,500 Depreciation and amortization 53,220 Non-cash compensation expense (1) 9,840 Other non-cash expenses or losses 570 Non-recurring expenses or costs (2) 9,960 Extraordinary, non-recurring or unusual gains or losses 5,590 Effects of purchase accounting adjustments 1,160 Business and asset dispositions (21,950) Permitted acquisitions 710 Currency gains and losses (720) Consolidated Bank EBITDA, as defined $ 160,160 December 31, 2022 Total Indebtedness, as defined $ 297,910 Consolidated Bank EBITDA, as defined 160,160 Actual total net leverage ratio 1.86 x Covenant requirement 4.00 x Year ended December 31, 2022 Interest expense, as defined $ 14,110 Bank stipulated adjustments: Interest income (610) Non-cash amounts attributable to amortization of financing costs (910) Total Consolidated Cash Interest Expense, as defined $ 12,590 37 Table of Contents December 31, 2022 Consolidated Bank EBITDA, as defined $ 160,160 Total Consolidated Cash Interest Expense, as defined 12,590 Actual interest expense coverage ratio 12.72 x Covenant requirement 3.00 x ________________________________________ (1) Non-cash compensation expenses resulting from the grant of equity awards.
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.
In addition to the pandemic and inflation-related factors affecting our 2021 and 2022 results, there has also been some volatility over the past two years as a direct and indirect result of foreign trade policy, where tariffs on certain of our commodity-based products sourced from Asia have been instituted, and certain North American suppliers have opportunistically increased their prices.
There has also been some volatility over the past two years as a direct and indirect result of foreign trade policy, where tariffs on certain of our commodity-based products sourced from Asia have been instituted, the conflict in Eastern Europe, creating certain input material shortages, and labor shortages at certain of our raw material suppliers.
Corporate expenses included in operating profit consist of the following (dollars in millions): Year ended December 31, 2022 2021 Corporate operating expenses $ 22.4 $ 26.1 Non-cash stock compensation 9.8 9.5 Legacy (income) expenses, net 5.7 1.6 (Gain) loss on disposition of assets (17.6) — Corporate expenses $ 20.3 $ 37.2 Corporate operating loss decreased $17.0 million to $20.3 million in 2022, from $37.2 million in 2021, primarily as a result of a $17.6 million gain on the sale of a non-core facility in City of Industry, California, and a $3.7 million decrease in corporate operating expenses as a result of the realignment charges related to the corporate office legal and finance groups in 2021.
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.
Our largest raw material purchases are for resins (such as polypropylene and polyethylene), steel, aluminum and other metal and non-metal-based purchased components.
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.
Selling, general and administrative expenses increased $2.3 million to $29.0 million, or 15.4% of sales, in 2022, as compared to $26.7 million, or 14.6% of sales, in 2021, primarily due to higher ongoing selling, general and administrative costs associated with our acquisition of TFI and higher employee-related costs.
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.
Packaging's operating profit decreased $15.5 million to $81.0 million, or 15.5% of sales, in 2022, as compared to $96.5 million, or 18.1% of sales, in 2021, as the impact of improved year-over-year recovery of material costs was more than offset by a less favorable product sales mix, lower fixed cost absorption, higher energy costs, higher selling, general and administrative expenses and the impact of $2.6 million of unfavorable currency exchange.
Packaging's operating profit decreased $20.9 million to $60.1 million, or 13.0% of sales, in 2023, as compared to $81.0 million, or 15.5% of sales, in 2022, as the impact of lower selling, general and administrative expenses and energy costs was more than offset by lower sales levels, lower absorption of fixed costs and higher realignment costs. 36 Table of Contents Aerospace.
For example, demand for engine, pump jack and compressor products are impacted by active oil and gas rig counts and wellhead investment activities. Separately, oil-based commodity costs are a significant driver of raw materials and purchased components used within our Packaging segment.
For example, demand for engine, pump jack and compressor products are impacted by active oil and gas rig counts and wellhead investment activities.
We received proceeds of $26.2 million from the termination of our cross-currency swap agreements. We also received proceeds of $28.8 million from the disposition of property and equipment, primarily related to the sale of vacant land adjacent to one of our manufacturing facilities and the sale of a non-core facility in California.
During 2022, we paid $64.1 million, net of cash acquired, to acquire Intertech, invested $46.0 million in capital expenditures and received cash from the disposition of business, property and equipment of $28.8 million, primarily related to the sale of vacant land adjacent to one of our manufacturing facilities and the sale of a non-core facility in California.
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 55,530 9,970 16,960 14,380 14,220 Benefit obligations 14,940 1,220 2,550 2,760 8,410 Interest obligations (a) 107,250 16,500 33,000 33,000 24,750 Total contractual and other cash obligations $ 577,720 $ 27,690 $ 52,510 $ 50,140 $ 447,380 __________________________ (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 $ 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%.
Operating profit within Specialty Products increased $7.7 million to $30.3 million, or 17.4% of sales, in 2022, as compared to $22.6 million, or 16.0% of sales, in 2021, primarily due to increased sales levels. Corporate Expenses.
Operating profit within Specialty Products increased $6.2 million to $36.4 million, or 19.3% of sales, in 2023, as compared to $30.3 million, or 17.4% of sales, in 2022, primarily due to increased sales levels, favorable material pricing and lower selling, general and administrative expenses, partially offset by wage inflation. Corporate Expenses.
Gross profit within Specialty Products increased $7.6 million to $39.0 million, or 22.5% of sales, in 2022, as compared to $31.5 million, or 22.4% of sales, in 2021. Gross profit increased due to higher sales levels and leverage of our fixed cost footprint, partially offset by higher steel and labor costs.
Gross profit within Specialty Products increased $5.2 million to $44.3 million, or 23.5% of sales, in 2023, as compared to $39.0 million, or 22.5% of sales, in 2022. Gross profit increased due to higher sales levels and favorable material pricing, partially offset by wage inflation.
If input costs increase at rapid rates, as they did during 2021, our ability to recover cost increases on a timely basis is made more difficult by the lag nature of these contracts. Our Arrow Engine business in our Specialty Products segment is sensitive to the demand for natural gas and crude oil in North America.
If input costs increase at rapid rates, our ability to recover cost increases on a timely basis is made more difficult by the lag nature of these contracts. Oil-based commodity costs are a significant driver of raw materials and purchased components used within our Packaging segment.
Days sales outstanding of receivables increased by five days through 2022, and remained relatively consistent through 2021. • We increased our investment in inventory by $7.0 million and $1.0 million in 2022 and 2021, respectively.
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.
Acquisition-related sales growth was $43.7 million, comprised of $28.7 million of sales from our February 2022 acquisition of Intertech and $15.0 million resulting from the January through November 2022 sales of our December 2021 acquisition of Omega.
Acquisition-related sales growth was $55.5 million, comprised of $5.3 million resulting from the January through February 2023 sales of our February 2022 acquisition of Intertech, $23.6 million from our February 2023 acquisition of Aarts, and $26.6 million from our April 2023 acquisition of Weldmac.
Packaging's selling, general and administrative expenses increased $6.6 million to $55.7 million, or 10.7% of sales, in 2022, as compared to $49.1 million, or 9.2% of sales, in 2021, primarily due to higher ongoing selling, general and administrative costs associated with our acquisitions as we integrate them into our portfolio, as well as higher realignment costs of $1.8 million primarily related to employee-related actions.
Packaging's selling, general and administrative expenses decreased $6.9 million to $48.8 million, or 10.5% of sales, in 2023, as compared to $55.7 million, or 10.7% of sales, in 2022, primarily due to the transfer of $5.5 million of information technology costs to Corporate in 2023, lower overall spending levels in 2023, consistent with current lower demand levels, as well as $1.0 million of lower costs associated with realignment actions.
Sales of engines, compressors and related parts used in stationary power generation and assistance applications for natural gas and crude oil extraction increased by $13.7 million primarily as a result of higher oil-field activity in North America.
Sales of engines, compressors and related parts used in stationary power generation and assistance applications for natural gas and crude oil extraction increased by $7.0 million, most of which occurred in the first half of 2023, as customers increased capital spending earlier in the year as compared to 2022 purchasing rates.
Net cash used for financing activities was $46.2 million in 2022, while net cash provided by financing activities was $11.8 million in 2021. During 2022, we purchased $36.9 million of outstanding common stock, used a net cash amount of $2.4 million related to our stock compensation arrangements and paid dividends of $6.9 million.
During 2023, we received net proceeds of $0.6 million from borrowings on our revolving credit facilities, purchased $18.8 million of outstanding common stock, used a net cash amount of $2.7 million related to our stock compensation arrangements, paid dividends of $6.7 million, and paid $3.3 million related to liabilities assumed in our acquisition of Aarts.
Our weighted average borrowings were $400.1 million during 2022, compared to $401.9 million during 2021, primarily due to a higher aggregate principal balance on our senior notes due to the issuance of the 2029 Senior Notes and the redemption of the 2025 Senior Notes during 2021.
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.
These amounts were partially offset by $4.1 million of additional pre-tax non-cash charges related to updating our asbestos studies in 2022 compared with 2021. 34 Table of Contents Liquidity and Capital Resources Cash Flows Cash flows provided by operating activities in 2022 were $72.6 million, as compared to $134.2 million in 2021.
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.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeAlso see Note 12, " Long-term Debt, " and Note 13, " Derivative Instruments ," included in Item 8, " Financial Statements and Supplementary Data ," within this Form 10-K for additional information. 43 Table of Contents
Biggest changeAlso see Note 11, " Long-term Debt, " and Note 12, " Derivative Instruments ," included in Item 8, " Financial Statements and Supplementary Data ," within this Form 10-K for additional information. 46 Table of Contents

Other TRS 10-K year-over-year comparisons