What changed in this filing

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Item 1. Financial Statements

2023-08-03 compared with 2023-05-04 · 172 added, 99 removed, 383 unchanged (41% of the section changed)

36 unchanged sentences

Total liabilities and shareholders' equity $ 1,451.8 $ 1,436.6

(1) - Our continuing operations exclude the results of our Aluminum Products business unit, which is held-for-sale as of March 31, 2023 and December 31, 2022 and presented in discontinued operations for all periods presented.

(1) - Our continuing operations exclude the results of our Aluminum Products business unit, which is held-for-sale as of June 30, 2023 and December 31, 2022 and presented in discontinued operations for all periods presented.

Refer to the accompanying notes to these unaudited condensed consolidated financial statements.

2 unchanged sentences

Condensed Consolidated Statements of Income (Unaudited)

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2023 2022 2023 2022

(In millions, except per share data)

3 unchanged sentences

Restructuring and other special charges 4.1 2.3 6.6 5.6

Gain on sale of assets ( 0.8 ) —

Gains on sales of assets — ( 2.9 ) ( 0.8 ) ( 2.9 )

Operating income 19.2 13.8 39.4 19.2

4 unchanged sentences

Income from continuing operations 6.6 6.9 14.2 10.8

Income attributable to noncontrolling interests ( 0.1 ) ( 0.2 )

Loss (income) attributable to noncontrolling interests 0.5 ( 0.5 ) 0.4 ( 0.7 )

Income from continuing operations attributable to Park-Ohio Holdings Corp.

15 unchanged sentences

Condensed Consolidated Statements of Comprehensive Income (Unaudited)

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2023 2022 2023 2022

(In millions)

6 unchanged sentences

Total other comprehensive income (loss) 2.9 ( 14.8 ) 8.0 ( 17.9 )

Total comprehensive income, net of tax 11.0 3.2

Comprehensive income attributable to noncontrolling interests ( 0.1 ) ( 0.2 )

Comprehensive income attributable to Park-Ohio Holdings Corp.

Total comprehensive income (loss), net of tax 7.8 ( 13.3 ) 18.8 ( 10.1 )

Comprehensive loss (income) attributable to noncontrolling interests 0.5 ( 0.5 ) 0.4 ( 0.7 )

Comprehensive income (loss) attributable to Park-Ohio Holdings Corp.

common shareholders $ 8.3 $ ( 13.8 ) $ 19.2 $ ( 10.8 )

15 unchanged sentences

Balance at March 31, 2023 16,663,463 16.7 151.3 243.0 ( 86.9 ) ( 56.7 ) 11.5 278.9

Other comprehensive income (loss) — — — 5.4 — 2.9 ( 0.5 ) 7.8

Stock-based compensation expense — — 1.7 — — — — 1.7

Stock-based compensation activity 309,237 0.3 ( 0.3 ) — — — — —

Dividends — — — ( 1.6 ) — — — ( 1.6 )

Payments of withholding taxes on share awards

— — — — ( 1.2 ) — — ( 1.2 )

Balance at June 30, 2023 16,972,700 $ 17.0 $ 152.7 $ 246.8 $ ( 88.1 ) $ ( 53.8 ) $ 11.0 $ 285.6

Shares Amount Additional

12 unchanged sentences

Balance at March 31, 2022 16,334,220 16.3 144.5 263.9 ( 85.4 ) ( 22.3 ) 10.9 327.9

Three Months Ended March 31,

Other comprehensive income (loss) — — — 1.0 — ( 14.8 ) 0.5 ( 13.3 )

Stock-based compensation expense — — 1.8 — — — — 1.8

Stock-based compensation activity 308,621 0.3 ( 0.3 ) — — — — —

Dividends — — — ( 1.6 ) — — — ( 1.6 )

Payments of withholding taxes on share awards

— — — — ( 1.0 ) — — ( 1.0 )

Balance at June 30, 2022 16,642,841 $ 16.6 $ 146.0 $ 263.3 $ ( 86.4 ) $ ( 37.1 ) $ 11.4 $ 313.8

Three Months Ended June 30, Six Months Ended June 30,

2023 2022 2023 2022

Dividends per common share $ 0.125 $ 0.125 $ 0.250 $ 0.250

3 unchanged sentences

Condensed Consolidated Statements of Cash Flows (Unaudited)

Three Months Ended March 31,

Six Months Ended June 30,

(In millions)

4 unchanged sentences

Stock-based compensation expense 3.3 3.4

Gain on sale of assets ( 0.8 ) —

Gains on sales of assets ( 0.8 ) ( 2.9 )

Changes in operating assets and liabilities:

15 unchanged sentences

Proceeds from (payments on) finance lease facilities, net 0.9 ( 1.3 )

Contingent consideration payment related to prior acquisition ( 1.3 ) —

Payments related to prior acquisitions ( 2.0 ) —

Dividends ( 3.2 ) ( 3.2 )

12 unchanged sentences

Income taxes paid $ 4.4 $ 2.7

Refer to the accompanying notes to these unaudited condensed consolidated financial statements.

2 unchanged sentences

Notes to Condensed Consolidated Financial Statements (Unaudited)

March 31, 2023

June 30, 2023

NOTE 1 — Basis of Presentation

6 unchanged sentences

In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included.

Operating results for the three-month period ended March 31, 2023 are not necessarily indicative of the results that may be expected for the year ending December 31, 2023.

Operating results for the three- and six-month periods ended June 30, 2023 are not necessarily indicative of the results that may be expected for the year ending December 31, 2023.

The balance sheet at December 31, 2022 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.

For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.

As of December 31, 2022 and March 31, 2023, we determined that our Aluminum Products business met the held-for-sale and discontinued operations accounting criteria.

We determined that our Aluminum Products business met the held-for-sale and discontinued operations accounting criteria as of December 31, 2022 and June 30, 2023.

Accordingly, the Company has reported the held-for-sale assets and liabilities, the operating results and the cash flows of Aluminum Products in discontinued operations for all periods presented throughout this Form 10-Q.

12 unchanged sentences

Notes to Condensed Consolidated Financial Statements (Unaudited)

March 31, 2023

Three Months Ended March 31,

June 30, 2023

Three Months Ended June 30, Six Months Ended June 30,

2023 2022 2023 2022

(In millions)

10 unchanged sentences

(In millions)

Three Months Ended March 31, 2023

Three Months Ended June 30, 2023

GEOGRAPHIC REGION

6 unchanged sentences

Total $ 197.3 $ 112.0 $ 118.8 $ 428.1

Three Months Ended March 31, 2022

Three Months Ended June 30, 2022

GEOGRAPHIC REGION

9 unchanged sentences

Notes to Condensed Consolidated Financial Statements (Unaudited)

March 31, 2023

June 30, 2023

Supply Technologies Segment Assembly Components Segment Engineered Products Segment Total Revenues

(In millions)

Six Months Ended June 30, 2023

GEOGRAPHIC REGION

United States $ 240.4 $ 163.8 $ 136.8 $ 541.0

Europe 77.6 9.1 30.5 117.2

Asia 30.4 11.9 35.9 78.2

Mexico 36.7 19.9 8.6 65.2

Canada 7.1 15.5 15.3 37.9

Other 0.9 2.2 9.0 12.1

Total $ 393.1 $ 222.4 $ 236.1 $ 851.6

Six Months Ended June 30, 2022

GEOGRAPHIC REGION

United States $ 209.6 $ 141.8 $ 110.8 $ 462.2

Europe 62.6 8.5 30.5 101.6

Asia 31.8 9.4 25.0 66.2

Mexico 32.7 18.4 8.0 59.1

Canada 6.1 14.0 10.1 30.2

Other 1.8 1.2 5.2 8.2

Total $ 344.6 $ 193.3 $ 189.6 $ 727.5

For over time arrangements, contract liabilities primarily relate to advances or deposits received from the Company’s customers before revenue is recognized.

These amounts, which totaled $ 51.4 million and $ 52.6 million at March 31, 2023 and December 31, 2022, respectively, are recorded in Accrued expenses and other in the Condensed Consolidated Balance Sheets.

These amounts, which totaled $ 53.3 million and $ 52.6 million at June 30, 2023 and December 31, 2022, respectively, are recorded in Accrued expenses and other in the Condensed Consolidated Balance Sheets.

For over time arrangements, contract assets primarily relate to revenue recognized in advance of billings to customers under long-term contracts accounted for under percentage of completion.

These amounts, which totaled $ 60.3 million and $ 56.7 million at March 31, 2023 and December 31, 2022, respectively, are recorded in Other current assets in the Condensed Consolidated Balance Sheets.

These amounts, which totaled $ 66.8 million and $ 56.7 million at June 30, 2023 and December 31, 2022, respectively, are recorded in Other current assets in the Condensed Consolidated Balance Sheets.

NOTE 4 — Segments

5 unchanged sentences

Segment operating income reconciles to consolidated income before income taxes by adjusting for corporate costs;

gain on sale of assets;

gains on sales of assets;

other components of pension income and other postretirement benefits expense, net;

1 unchanged sentence

Results by business segment were as follows:

Three Months Ended March 31,

Park-Ohio Holdings Corp.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

June 30, 2023

Three Months Ended June 30, Six Months Ended June 30,

2023 2022 2023 2022

(In millions)

2 unchanged sentences

Assembly Components 1

112.0 95.4 222.4 193.3

Engineered Products 118.8 98.6 236.1 189.6

3 unchanged sentences

Assembly Components 1

8.4 ( 1.4 ) 15.7 ( 1.9 )

Engineered Products 3.2 7.1 8.2 8.9

1 unchanged sentence

Corporate costs ( 7.8 ) ( 7.5 ) ( 14.7 ) ( 15.4 )

Gain on sale of assets 0.8 —

Gains on sales of assets — 2.9 0.8 2.9

Operating income 19.2 13.8 39.4 19.2

Other components of pension income and other postretirement benefits expense, net

0.6 2.8 1.3 5.6

Interest expense, net ( 11.1 ) ( 7.6 ) ( 21.8 ) ( 14.7 )

Income from continuing operations before income taxes 1

Park-Ohio Holdings Corp.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

March 31, 2023

$ 8.7 $ 9.0 $ 18.9 $ 10.1

Aluminum Products was previously included in our Assembly Components segment.

NOTE 5 — Discontinued Operations

8 unchanged sentences

The Aluminum Products business was previously reported in the Company’s Assembly Components segment until meeting the discontinued operations criteria.

See Note 10 for discussion of the entry into a memorandum of understanding (the “MOU”) related to the potential sale of this business.

Three Months Ended March 31,

See Note 10 for further discussion related to the potential sale of this business.

Park-Ohio Holdings Corp.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

June 30, 2023

Three Months Ended June 30, Six Months Ended June 30,

2023 2022 2023 2022

Net sales $ 45.4 $ 58.9 $ 92.3 $ 119.6

2 unchanged sentences

Restructuring and other special charges — 2.7 — 3.2

Operating (loss) income ( 1.7 ) 2.6

Operating loss ( 1.6 ) ( 6.2 ) ( 3.3 ) ( 3.6 )

Interest expense 1

( 0.8 ) ( 0.7 ) ( 1.5 ) ( 1.4 )

(Loss) income from operation of discontinued operations ( 2.4 ) 1.9

Loss from operation of discontinued operations ( 2.4 ) ( 6.9 ) ( 4.8 ) ( 5.0 )

Income tax benefit 0.7 1.5 1.4 2.0

(Loss) income from discontinued operations, net of tax $ ( 1.7 ) $ 2.4

(1) - Interest expense includes an allocation of interest that is not directly attributable to our Aluminum Products business, totaling $ 0.6 million in both three months ended March 31, 2023 and 2022.

Loss from discontinued operations, net of tax $ ( 1.7 ) $ ( 5.4 ) $ ( 3.4 ) $ ( 3.0 )

(1) - Interest expense includes an allocation of interest that is not directly attributable to our Aluminum Products business.

The allocations were $ 0.7 million and $ 0.6 million in the three months ended June 30, 2023 and 2022, respectively, and $ 1.3 million and $ 1.2 million in the six months ended June 30, 2023 and 2022, respectively.

The following represents the details of assets and liabilities held-for-sale in each period:

Park-Ohio Holdings Corp.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

March 31, 2023

March 31, 2023 December 31, 2022

June 30, 2023 December 31, 2022

(In millions, except share data)

20 unchanged sentences

Total liabilities held-for-sale $ 42.3 $ 43.8

(1) - We reasonably expect to finalize the sale of the Aluminum Products business in 2023, and therefore we have presented all assets and liabilities held-for-sale as current in the Condensed Consolidated Balance Sheet.

NOTE 6 — Plant Closure and Consolidation

During the three months ended March 31, 2023 and 2022, the Company incurred the following expenses related to plant closure and consolidation in connection with its profit-improvement actions across its segments.

These charges are included in Restructuring and other special charges in the Condensed Consolidated Statements of Income.

(1) - We reasonably expect to finalize the sale of the Aluminum Products business in the next twelve months, and therefore we have presented all assets and liabilities held-for-sale as current in the Condensed Consolidated Balance Sheet.

Park-Ohio Holdings Corp.

1 unchanged sentence

Notes to Condensed Consolidated Financial Statements (Unaudited)

March 31, 2023

June 30, 2023

NOTE 6 — Plant Closure and Consolidation

During the three and six months ended June 30, 2023 and 2022, the Company incurred the following expenses related to plant closure and consolidation in connection with its profit-improvement actions across its segments.

These charges are included in Restructuring and other special charges in the Condensed Consolidated Statements of Income.

Facility-Related Costs Severance and Other Total

Three months ended June 30, 2023:

Assembly Components $ 0.2 $ — $ 0.2

1 unchanged sentence

Total $ 0.9 $ 1.9 $ 2.8

Three months ended June 30, 2022:

Assembly Components $ 1.5 $ — $ 1.5

1 unchanged sentence

Total $ 2.3 $ — $ 2.3

The actions in the Assembly Components segment were primarily in connection with actions taken to close and consolidate its extrusion operations in Tennessee and its fuel operations in Michigan, to relocate certain production to lower-cost facilities with open capacity, and to complete other cost-reduction actions.

Facility-Related Costs Severance and Other Total

Six months ended June 30, 2023:

Assembly Components $ 0.5 $ — $ 0.5

Engineered Products 2.7 1.9 4.6

Total $ 3.2 $ 1.9 $ 5.1

Six months ended June 30, 2022:

Assembly Components $ 3.0 $ — $ 3.0

Engineered Products 1.2 0.1 1.3

Total $ 4.2 $ 0.1 $ 4.3

The actions in the Assembly Components segment were primarily in connection with actions taken to close and consolidate its extrusion operations in Tennessee and its fuel operations in Michigan, relocate certain production to lower-cost facilities with open capacity, and complete other cost-reduction actions.

The actions in the Engineered Product segment were primarily in connection with plant closure and consolidation of multiple locations, and to complete other cost-reduction actions.

The Company expects to incur expenses of approximately $ 1.0 million in the remainder of 2023 in connection with its plant closure and consolidation activities.

The Company expects to incur expenses of less than $ 1.0 million in the remainder of 2023 in connection with its plant closure and consolidation activities.

Park-Ohio Holdings Corp.

and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

June 30, 2023

NOTE 7 — Inventories

Inventories, net consist of the following:

March 31, 2023 December 31, 2022

June 30, 2023 December 31, 2022

(In millions)

3 unchanged sentences

Inventories, net $ 405.9 $ 406.5

Park-Ohio Holdings Corp.

and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

March 31, 2023

NOTE 8 — Accrued Warranty Costs

1 unchanged sentence

Actual warranty expense could differ from the estimates made by the Company based on product performance.

The following table presents changes in the Company’s product warranty liability for the three months ended March 31, 2023 and 2022:

Three Months Ended March 31,

The following table presents changes in the Company’s product warranty liability for the three and six months ended June 30, 2023 and 2022:

Three Months Ended June 30, Six Months Ended June 30,

2023 2022 2023 2022

(In millions)

5 unchanged sentences

NOTE 9 — Income Taxes

The Company’s tax provision for interim periods is determined using an estimate of its annual effective rate, adjusted for discrete items, if any, in each period.

In the three months ended March 31, 2023, income tax expense was $ 2.6 million on pre-tax income from continuing operations of $ 10.2 million, representing an effective income tax rate of 25 %.

In the three months ended March 31, 2022, income tax benefit was $ 2.8 million, on pretax income of $ 1.1 million.

The Company’s tax provision for interim periods is determined using an estimate of its annual effective rate, adjusted for discrete items in each period, if any.

In the three months ended June 30, 2023, income tax expense was $ 2.1 million on pre-tax income from continuing operations of $ 8.7 million, representing an effective income tax rate of 24 %.

In the three months ended June 30, 2022, income tax expense was $ 2.1 million on pre-tax income of $ 9.0 million, an effective income tax rate of 23 %.

In the six months ended June 30, 2023, income tax expense was $ 4.7 million on pre-tax income from continuing operations of $ 18.9 million, representing an effective income tax rate of 24 %.

In the six months ended June 30, 2022, income tax benefit was $ 0.7 million on pre-tax income of $ 10.1 million.

The benefit in 2022 included a discrete tax benefit of $ 3.2 million related to federal research and development tax credits.

1 unchanged sentence

Debt consists of the following:

Park-Ohio Holdings Corp.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

June 30, 2023

Carrying Value at

Maturity Date Interest Rate at

March 31, 2023 March 31, 2023 December 31, 2022

June 30, 2023 June 30, 2023 December 31, 2022

(In millions)

7 unchanged sentences

Total long-term debt $ 673.1 $ 655.1

In addition to debt listed above, on December 30, 2022, the Company entered into the MOU with a third party pursuant to which the third party would purchase our Aluminum Products business.

In addition to debt listed above, on December 30, 2022, the Company entered into a memorandum of understanding (the “MOU”) with a third party pursuant to which the third party would purchase our Aluminum Products business.

The sale of the Aluminum Products business is subject to the successful completion of a definitive purchase agreement and other customary conditions.

In connection with the MOU, the Company also entered into a financing arrangement with the third party pursuant to which the Company received a portion

Park-Ohio Holdings Corp.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

March 31, 2023

of the estimated purchase price of the Aluminum Products business, including $ 20.0 million of cash and a promissory note in the principal amount of $ 25.0 million, and recorded a financing arrangement liability of $ 45.0 million.

In connection with the MOU, the Company also entered into a financing arrangement with the third party pursuant to which the Company received a portion of the estimated purchase price of the Aluminum Products business, including $ 20.0 million of cash and a promissory note in the principal amount of $ 25.0 million, and recorded a financing arrangement liability of $ 45.0 million.

The Company used the $ 20.0 million from this financing arrangement to repay indebtedness under its revolving credit facility.

If a definitive purchase agreement between the parties is not entered into or the sale is not successfully consummated, the promissory note will be cancelled and the Company will repay the third party $ 20.0 million, less a $ 0.8 million break-up fee.

Park-Ohio's Seventh Amended and Restated Credit Agreement (the “Credit Agreement”) provides for a revolving credit facility in the amount of $ 405.0 million, including a $ 40.0 million Canadian revolving subcommitment and a European revolving subcommitment in the amount of $ 30.0 million.

The Seventh Amended and Restated Credit Agreement (the “Credit Agreement”) of the Company's subsidiary, Park-Ohio Industries, Inc.

(“Park-Ohio”) provides for a revolving credit facility in the amount of $ 405.0 million, including a $ 40.0 million Canadian revolving subcommitment and a European revolving subcommitment in the amount of $ 30.0 million.

Pursuant to the Credit Agreement, Park-Ohio has the option to increase the availability under the revolving credit facility by an aggregate incremental amount up to $ 70.0 million.

The Credit Agreement matures on November 26, 2024.

As of March 31, 2023, we had borrowing availability of $ 98.4 million under the Credit Agreement.

We had outstanding bank guarantees and letters of credit under our credit arrangements of approximately $ 46.0 million at March 31, 2023 and $ 41.0 million at December 31, 2022.

As of June 30, 2023, we had borrowing availability of $ 86.8 million under the Credit Agreement.

We had outstanding bank guarantees and letters of credit under our credit arrangements of approximately $ 46.5 million at June 30, 2023 and $ 41.0 million at December 31, 2022.

In 2017, Park-Ohio completed the issuance, in a private placement, of $ 350.0 million aggregate principal amount of 6.625 % Senior Notes due 2027 (the “Notes”).

2 unchanged sentences

The Lease Agreement provides the Company up to $ 50.0 million for finance leases.

Finance lease obligations of $ 4.5 million were borrowed under the Lease Agreement to acquire machinery and equipment as of March 31, 2023.

As of March 31, 2023, the Company had additional finance leases totaling $ 15.7 million.

Finance lease obligations of $ 4.0 million were borrowed under the Lease Agreement to acquire machinery and equipment as of June 30, 2023.

As of June 30, 2023, the Company had additional finance leases totaling $ 15.4 million.

In 2015, the Company, through its Southwest Steel Processing LLC subsidiary, entered into a financing agreement with the Arkansas Development Finance Authority, which matures in September 2025.

The financing agreement provides the Company the ability to borrow up to $ 11.0 million for expansion of its manufacturing facility in Arkansas.

The Company had $ 4.0 million of borrowings outstanding under this agreement as of March 31, 2023, which is included in Other above.

The Company had $ 3.7 million of borrowings outstanding under this agreement as of June 30, 2023, which is included in Other above.

The following table represents fair value information of the Notes, classified as Level 1 using estimated quoted market prices.

March 31, 2023 December 31, 2022

(In millions)

Carrying amount $ 350.0 $ 350.0

Fair value $ 273.9 $ 227.5

Park-Ohio Holdings Corp.

1 unchanged sentence

Notes to Condensed Consolidated Financial Statements (Unaudited)

March 31, 2023

June 30, 2023

June 30, 2023 December 31, 2022

(In millions)

Carrying amount $ 350.0 $ 350.0

Fair value $ 311.5 $ 227.5

The fair value of the revolving credit facility is equal to its carrying value as the Company has the ability to repay the outstanding principal at par value at any time.

The carrying values of cash and cash equivalents, receivables and accounts payable approximate fair value due to the short-term nature of these instruments.

NOTE 11 — Stock-Based Compensation

A summary of restricted share activity for the three months ended March 31, 2023 is as follows:

A summary of restricted share activity for the six months ended June 30, 2023 is as follows:

Time-Based Performance-Based

3 unchanged sentences

Outstanding - beginning of year 716,242 $ 20.53 50,000 $ 32.55

Granted 9,535 13.89 — —

332,039 15.97 — —

Vested ( 266,946 ) 20.38 — —

Canceled or expired ( 4,267 ) 20.12 — —

Outstanding - end of period 777,068 $ 18.64 50,000 $ 32.55

(a) - Included in this amount is 9,000 restricted share units.

Stock-based compensation is included in Selling, general and administrative expenses in the Condensed Consolidated Statements of Income.

Total stock-based compensation expense was $ 1.6 million for both the three months ended March 31, 2023 and 2022.

As of March 31, 2023, there was $ 6.6 million of unrecognized compensation cost related to non-vested stock-based compensation, which cost is expected to be recognized over a weighted-average period of 1.6 years.

Total stock-based compensation expense was $ 1.7 million and $ 1.8 million for the three months ended June 30, 2023 and 2022, respectively.

Total stock-based compensation expense was $ 3.3 million and $ 3.4 million for the six months ended June 30, 2023 and 2022, respectively.

As of June 30, 2023, there was $ 9.9 million of unrecognized compensation cost related to non-vested stock-based compensation, which cost is expected to be recognized over a weighted-average period of 2.1 years.

NOTE 12 — Commitments and Contingencies

7 unchanged sentences

however, actual results may differ materially from our estimates.

Park-Ohio Holdings Corp.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

June 30, 2023

In addition to the routine lawsuits and asserted claims noted above, we are also a co-defendant in 112 cases asserting claims on behalf of 162 plaintiffs alleging personal injury as a result of exposure to asbestos.

3 unchanged sentences

While it is not possible to predict the ultimate outcome of asbestos-related lawsuits, claims and proceedings due to the unpredictable nature of personal injury litigation, and although our results of operations and cash flows for a particular period could be adversely affected by asbestos-related lawsuits, claims and proceedings, management believes that the ultimate resolution of these matters will not have a material adverse effect on our financial condition, liquidity or results of operations.

Park-Ohio Holdings Corp.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

March 31, 2023

NOTE 13 — Pension and Postretirement Benefits

The components of net periodic benefit (income) expense costs recognized for the three months ended March 31, 2023 and 2022 were as follows:

The components of net periodic benefit (income) expense costs recognized for the three and six months ended June 30, 2023 and 2022 were as follows:

Pension Benefits Postretirement Benefits

Three Months Ended March 31, Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30, Three Months Ended June 30, Six Months Ended June 30,

2023 2022 2023 2022 2023 2022 2023 2022

6 unchanged sentences

NOTE 14 — Accumulated Other Comprehensive Loss

The components of and changes in accumulated other comprehensive loss for the three months ended March 31, 2023 and 2022 were as follows:

The components of and changes in accumulated other comprehensive loss for the three and six months ended June 30, 2023 and 2022 were as follows:

Park-Ohio Holdings Corp.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

June 30, 2023

Cumulative Translation Adjustment Cash Flow Hedges Pension and Postretirement Benefits Total Cumulative Translation Adjustment Cash Flow Hedges Pension and Postretirement Benefits Total

(In millions)

Three Months Ended March 31, 2023 Three Months Ended March 31, 2022

Three Months Ended June 30, 2023 Three Months Ended June 30, 2022

Beginning balance $ ( 35.4 ) $ 0.3 $ ( 21.6 ) $ ( 56.7 ) $ ( 22.2 ) $ 0.7 $ ( 0.8 ) $ ( 22.3 )

4 unchanged sentences

Ending balance $ ( 33.2 ) $ 0.1 $ ( 20.7 ) $ ( 53.8 ) $ ( 36.8 ) $ 0.5 $ ( 0.8 ) $ ( 37.1 )

Six Months Ended June 30, 2023 Six Months Ended June 30, 2022

Beginning balance $ ( 38.7 ) $ 0.5 $ ( 23.6 ) $ ( 61.8 ) $ ( 18.3 ) $ — $ ( 0.9 ) $ ( 19.2 )

Currency translation (a)

5.5 — — 5.5 ( 18.5 ) — — ( 18.5 )

Foreign currency forward contracts — ( 0.4 ) — ( 0.4 ) — 0.5 — 0.5

Pension and OPEB activity, net of tax — — 2.9 2.9 — — 0.1 0.1

Ending balance $ ( 33.2 ) $ 0.1 $ ( 20.7 ) $ ( 53.8 ) $ ( 36.8 ) $ 0.5 $ ( 0.8 ) $ ( 37.1 )

(a) No income taxes were provided on currency translation as foreign earnings are considered permanently reinvested.

1 unchanged sentence

The following table sets forth the weighted-average number of shares used in the computation of earnings per share:

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2023 2022 2023 2022

(In millions)

2 unchanged sentences

Weighted-average diluted shares outstanding 12.4 12.2 12.4 12.2

Park-Ohio Holdings Corp.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements (Unaudited)

March 31, 2023

Certain restricted stock awards are anti-dilutive and therefore excluded from the computation of diluted earnings per share.

Anti-dilutive shares were 0.1 million and 0.2 million for the three months ended March 31, 2023 and 2022, respectively.

Anti-dilutive shares were 0.2 million and 0.3 million for the three months ended June 30, 2023 and 2022, respectively, and 0.2 million and 0.3 million for the six months ended June 30, 2023 and 2022, respectively.

NOTE 16 — Subsequent Event

On April 21, 2023, the Company's Board of Directors declared a quarterly dividend of $ 0.125 per common share.

The dividend will be paid on May 19, 2023 to shareholders of record as of the close of business on May 5, 2023 and will result in a cash outlay of approximately $ 1.6 million.

On July 21, 2023, the Company's Board of Directors declared a quarterly dividend of $ 0.125 per common share.

The dividend will be paid on August 18, 2023 to shareholders of record as of the close of business on August 4, 2023 and will result in a cash outlay of approximately $ 1.6 million.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements