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Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 30, 2010	Oct. 29, 2010
Statement [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2010
Document Fiscal Year Focus	2010
Document Fiscal Period Focus	Q3
Trading Symbol	KOP
Entity Registrant Name	KOPPERS HOLDINGS INC.
Entity Central Index Key	0001315257
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		20,565,616

CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS - USD ($) shares in Thousands, $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2010	Sep. 30, 2009	Sep. 30, 2010	Sep. 30, 2009
Statement [Line Items]
Net sales	$ 336.3	$ 289.8	$ 937.7	$ 854.1
Cost of sales (excluding items below)	280.4	237.5	786.4	709.9
Depreciation and amortization	7.0	6.1	20.4	18.4
Selling, general and administrative expenses	15.4	13.0	47.8	40.9
Operating profit	33.5	33.2	83.1	84.9
Other income (loss)	0.0	(0.3)	1.8	(0.5)
Interest expense	6.6	10.0	20.4	30.2
Income before income taxes	26.9	22.9	64.5	54.2
Income taxes	11.1	5.8	25.0	19.7
Income from continuing operations	15.8	17.1	39.5	34.5
Loss on sale of discontinued operations, net of tax benefit of $0.0, $0.0, $0.1 and $0.2	0.0	0.0	(0.2)	(0.3)
Net income	15.8	17.1	39.3	34.2
Net income attributable to noncontrolling interests	0.2	0.7	0.3	2.0
Net income attributable to Koppers	$ 15.6	$ 16.4	$ 39.0	$ 32.2
Basic -
Continuing operations	$ 0.76	$ 0.80	$ 1.91	$ 1.59
Discontinued operations	0.00	0.00	(0.01)	(0.01)
Earnings per basic common share	0.76	0.80	1.90	1.58
Diluted -
Continuing operations	0.75	0.80	1.90	1.58
Discontinued operations	0.00	0.00	(0.01)	(0.01)
Earnings per diluted common share	$ 0.75	$ 0.80	$ 1.89	$ 1.57
Weighted average shares outstanding (in thousands):
Basic	20,566	20,454	20,533	20,443
Diluted	20,648	20,584	20,666	20,532
Dividends declared per common share	$ 0.22	$ 0.22	$ 0.66	$ 0.66

CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Parenthetical) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2010	Sep. 30, 2009	Sep. 30, 2010	Sep. 30, 2009
Statement [Line Items]
Loss on sale of discontinued operations, tax benefit	$ 0.0	$ 0.0	$ 0.1	$ 0.2

CONDENSED CONSOLIDATED BALANCE SHEET - USD ($) $ in Millions	9 Months Ended	12 Months Ended
	Sep. 30, 2010	Dec. 31, 2009
Assets
Cash and cash equivalents	$ 33.1	$ 58.4
Short-term investments	0.0	4.4
Accounts receivable, net of allowance of $0.1 and $0.5	144.1	102.5
Income tax receivable	22.0	37.1
Inventories, net	151.3	152.7
Deferred tax assets	8.5	8.5
Other current assets	21.4	17.4
Total current assets	380.4	381.0
Equity in non-consolidated investments	4.6	4.7
Property, plant and equipment, net	155.0	149.3
Goodwill	69.8	61.6
Deferred tax assets	21.3	25.9
Other assets	25.9	21.9
Total assets	657.0	644.4
Liabilities
Accounts payable	85.7	67.3
Accrued liabilities	57.6	54.8
Dividends payable	5.1	9.5
Short-term debt and current portion of long-term debt	0.2	0.2
Total current liabilities	148.6	131.8
Long-term debt	295.9	335.1
Accrued postretirement benefits	80.8	81.9
Other long-term liabilities	35.0	40.8
Total liabilities	$ 560.3	$ 589.6
Commitments and contingent liabilities (Note 16)
Equity
Senior Convertible Preferred Stock, $0.01 par value per share; 10,000,000 shares authorized; no shares issued	$ 0.0	$ 0.0
Common Stock, $0.01 par value per share; 40,000,000 shares authorized; 21,264,698 and 21,124,212 shares issued	0.2	0.2
Additional paid-in capital	135.8	127.2
Retained deficit	(12.1)	(37.3)
Accumulated other comprehensive loss	(13.7)	(22.7)
Treasury stock, at cost, 699,082 and 669,340 shares	(24.5)	(23.6)
Total Koppers stockholders' equity	85.7	43.8
Noncontrolling interests	11.0	11.0
Total equity	96.7	54.8
Total liabilities and equity	$ 657.0	$ 644.4

CONDENSED CONSOLIDATED BALANCE SHEET (Parenthetical) - USD ($) $ in Millions	Sep. 30, 2010	Dec. 31, 2009
Statement [Line Items]
Accounts receivable, allowance	$ 0.1	$ 0.5
Senior Convertible Preferred Stock, par value	$ 0.01	$ 0.01
Senior Convertible Preferred Stock, shares authorized	10,000,000	10,000,000
Senior Convertible Preferred Stock, shares issued	0	0
Common Stock, par value	$ 0.01	$ 0.01
Common Stock, shares authorized	40,000,000	40,000,000
Common Stock, shares issued	21,264,698	21,124,212
Treasury stock, shares	699,082	669,340

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2010	Sep. 30, 2009
Cash provided by (used in) operating activities:
Net income	$ 39.3	$ 34.2
Adjustments to reconcile net cash provided by operating activities:
Depreciation and amortization	20.4	19.9
(Gain) loss on sale of fixed assets	(1.0)	0.7
Deferred income taxes	3.9	(4.9)
Equity income, net of dividends received	0.1	1.4
Change in other liabilities	(5.6)	9.2
Non-cash interest expense	1.3	14.0
Stock-based compensation	2.5	1.7
Other	0.4	0.4
(Increase) decrease in working capital:
Accounts receivable	(35.2)	(1.5)
Inventories	12.6	19.5
Accounts payable	6.9	(5.2)
Accrued liabilities and other working capital	18.7	3.2
Net cash provided by operating activities	64.3	92.6
Cash provided by (used in) investing activities:
Capital expenditures	(13.7)	(11.2)
Acquisitions, net of cash acquired	(19.9)	0.0
Net cash proceeds from divestitures and asset sales	1.9	(1.1)
Net cash used in investing activities	(31.7)	(12.3)
Cash provided by (used in) financing activities:
Borrowings of revolving credit	138.9	0.0
Repayments of revolving credit	(178.9)	0.0
Repayments of long-term debt	(0.1)	(0.1)
Repurchases of Common Stock	(0.9)	0.0
Payment of deferred financing costs	(0.4)	0.0
Dividends paid	(18.5)	(13.5)
Net cash used in financing activities	(59.9)	(13.6)
Effect of exchange rate changes on cash	2.0	1.1
Net increase (decrease) in cash and cash equivalents	(25.3)	67.8
Cash and cash equivalents at beginning of year	58.4	63.1
Cash and cash equivalents at end of period	$ 33.1	$ 130.9

Basis of Presentation	9 Months Ended
Basis of Presentation	Sep. 30, 2010
Statement [Line Items]
Basis of Presentation	1. Basis of Presentation The accompanying unaudited condensed consolidated financial statements and related disclosures have been prepared in accordance with accounting principles generally accepted in the United States applicable to interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation of Koppers Holdings Inc.’s and its subsidiaries’ (“Koppers”, “Koppers Holdings” or the “Company”) financial position and interim results as of and for the periods presented have been included. All such adjustments are of a normal recurring nature unless disclosed otherwise. Because the Company’s business is seasonal, results for interim periods are not necessarily indicative of those that may be expected for a full year. The Condensed Consolidated Balance Sheet for December 31, 2009 has been summarized from the audited balance sheet contained in the Annual Report on Form 10-K for the year ended December 31, 2009. The financial information included herein should be read in conjunction with the Company’s audited consolidated financial statements and related notes included in its Annual Report on Form 10-K for the year ended December 31, 2009.

Dividends	9 Months Ended
Dividends	Sep. 30, 2010
Statement [Line Items]
Dividends	2. Dividends On November 3, 2010, the Company’s board of directors declared a quarterly dividend of 22 cents per common share, payable on January 7, 2011 to shareholders of record as of November 15, 2010.

Business Acquisition

9 Months Ended

Sep. 30, 2010

Statement [Line Items]

Business Acquisition

3. Business Acquisition

On March 1, 2010, the Company acquired 100 percent of the outstanding shares of privately-owned Cindu Chemicals B.V. (“Cindu”), a Dutch company which operates a 140,000 metric ton coal tar distillation plant in Uithoorn, Netherlands. Concurrent with the acquisition, the Company entered into a long-term tar supply agreement with Corus Staal, who supplies the majority of the Uithoorn plant’s raw material requirements. The acquisition strengthens the Company’s presence in Europe and increases the Company’s ability to service its export markets. Cindu was subsequently renamed Koppers Netherlands B.V. (“Koppers Netherlands”).

The acquired company contributed revenues of $14.3 million and operating profit of $0.2 million for the three months ended September 30, 2010 and revenues of $32.7 million and operating loss of $0.2 million for the nine months ended September 30, 2010. Depreciation and amortization associated with Koppers Netherlands totaled $0.7 million for the three months ended September 30, 2010 and $1.6 million for the nine months ended September 30, 2010. Koppers Netherlands’ revenues were $6.8 million and its operating loss was $1.6 million in 2010 for the two-month period prior to the acquisition. Koppers Netherlands’ revenues were $11.3 million and its operating loss was $0.6 million for the three months ended September 30, 2009 and its revenues were $27.9 million and its operating loss was $3.3 million for the nine months ended September 30, 2009.

The consolidated pro forma results of operations if the acquisition had been completed as of the beginning of the year in 2010 would have been pro forma revenue of $944.5 million and operating profit of $81.3 million for the nine months ended September 30, 2010. The consolidated pro forma results of operations if the acquisition had been completed as of the beginning of the year in 2009 would have been revenues of $301.1 million and operating profit of $32.5 million for the three months ended September 30, 2009 and revenues of $882.0 million and operating profit of $81.3 million for the nine months ended September 30, 2009.

The acquisition was funded with cash on hand and the acquisition price was $21.6 million. The provisional identifiable assets acquired and liabilities assumed upon the acquisition of Koppers Netherlands are shown in the table below. Items subject to adjustment during the measurement period include, among other items, final valuations for tangible and intangible assets and other liabilities.


	March 1, 2010
(Dollars in millions)
Cash and cash equivalents	$	2.1
Accounts receivable		6.5
Inventory		7.1
Other current assets		1.8
Property, plant and equipment		8.3
Intangibles		4.4
Goodwill		6.9

Total assets acquired		37.1
Accounts payable		9.8
Accrued liabilities		3.0
Long-term debt		0.6
Deferred tax liability		1.3
Long-term liabilities		0.8

Net assets acquired	$	21.6

All assets acquired and liabilities assumed were recorded at estimated fair value. Goodwill of $6.9 million was allocated to the Carbon Materials & Chemicals segment and is not deductible for income tax purposes under Dutch law. Net assets acquired included intangible assets with respect to a coal tar supply agreement of $2.9 million and customer relationships of $0.7 million which will be amortized over a period of ten years and a favorable lease agreement of $0.8 million which will be amortized over a period of three years. The intangible assets other than goodwill are classified in other assets in the condensed consolidated balance sheet. Acquisition expenses were $0.0 and $1.8 million for the three months and nine months ended September 30, 2010, respectively, and are charged to selling, general and administrative expenses.

Fair Value Measurements

9 Months Ended

Sep. 30, 2010

Statement [Line Items]

Fair Value Measurements

4. Fair Value Measurements

Carrying amounts and the related estimated fair values of the Company’s financial instruments as of September 30, 2010 and December 31, 2009 are as follows:


	September 30, 2010				December 31, 2009
	Fair Value		Carrying Value		Fair Value		Carrying Value
(Dollars in millions)
Financial assets:
Cash and cash equivalents, including restricted cash	$	33.1	$	33.1	$	58.4	$	58.4
Short-term investments		0.0		0.0		4.4		4.4
Investments and other assets^(a)		1.3		1.3		1.3		1.3
Financial liabilities:
Long-term debt (including current portion)	$	310.5	$	296.1	$	344.8	$	335.3

(a)

Excludes equity method investments.

Cash and short-term investments – The carrying amount approximates fair value because of the short maturity of those instruments.

Investments and other assets – Represents the broker-quoted cash surrender value on universal life insurance policies. This asset is classified as Level 2 in the valuation hierarchy and is measured from values received from financial institutions.

Debt – The fair value of the Company’s long-term debt is estimated based on the market prices for the same or similar issues or on the current rates offered to the Company for debt of the same remaining maturities (Level 2). The fair values of the revolving credit facility approximate carrying value due to the variable rate nature of these instruments.

Comprehensive Income and Equity

9 Months Ended

Sep. 30, 2010

Statement [Line Items]

Comprehensive Income and Equity

5. Comprehensive Income and Equity

Total comprehensive income for the three and nine months ended September 30, 2010 and 2009 is summarized in the table below:


	Three Months Ended September 30,						Nine Months Ended September 30,
	2010			2009			2010			2009
(Dollars in millions)
Net income	$	15.8		$	17.1		$	39.3		$	34.2
Other comprehensive income (loss):
Change in currency translation adjustment		20.3			7.0			6.9			23.1
Change in unrecognized pension transition asset, net of tax		(0.1	)		(0.1	)		(0.2	)		(0.2	)
Change in unrecognized prior service cost, net of tax		0.0			(0.1	)		0.0			(0.1	)
Change in unrecognized pension net loss, net of tax		0.8			1.1			2.5			3.0

Total comprehensive income		36.8			25.0			48.5			60.0
Less: comprehensive income attributable to noncontrolling interests		0.4			1.6			0.6			2.9

Comprehensive income attributable to Koppers	$	36.4		$	23.4		$	47.9		$	57.1

The following tables present the change in equity for the nine months ended September 30, 2010 and September 30, 2009, respectively:


(Dollars in millions)	Total Koppers Shareholders’ Equity			Noncontrolling Interests			Total Equity
Balance at January 1, 2010	$	43.8		$	11.0		$	54.8
Net income		39.0			0.3			39.3
Issuance of common stock		3.7			0.0			3.7
Employee stock plans		4.9			0.0			4.9
Other comprehensive income (loss)		8.9			0.3			9.2
Dividends		(13.7	)		(0.6	)		(14.3	)
Repurchases of common stock		(0.9	)		0.0			(0.9	)

Balance at September 30, 2010	$	85.7		$	11.0		$	96.7


(Dollars in millions)	Total Koppers Stockholders’ Equity			Noncontrolling Interests			Total Equity
Balance at January 1, 2009	$	18.0		$	8.0		$	26.0
Net income		32.2			2.0			34.2
Other comprehensive income		24.9			0.9			25.8
Issuance of common stock		0.6			0.0			0.6
Dividends to Koppers stockholders		(13.7	)		0.0			(13.7	)
Dividends to noncontrolling interests		0.0			(0.5	)		(0.5	)

Balance at September 30, 2009	$	62.0		$	10.4		$	72.4

Earnings per Common Share

9 Months Ended

Sep. 30, 2010

Statement [Line Items]

Earnings per Common Share

6. Earnings per Common Share

The computation of basic earnings per common share for the periods presented is based upon the weighted average number of common shares outstanding during the periods. The computation of diluted earnings per common share includes the effect of nonvested nonqualified stock options and restricted stock units assuming such options and stock units were outstanding common shares at the beginning of the period. The effect of antidilutive securities is excluded from the computation of diluted earnings per common share.

The following table sets forth the computation of basic and diluted earnings per common share:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2010		2009		2010			2009
(Dollars in millions, except share amounts, in thousands, and per share amounts)
Net income attributable to Koppers	$	15.6	$	16.4	$	39.0		$	32.2
Less: discontinued operations		0.0		0.0		(0.2	)		(0.3	)

Income from continuing operations attributable to Koppers	$	15.6	$	16.4	$	39.2		$	32.5

Weighted average common shares outstanding:
Basic		20,566		20,454		20,533			20,443
Effect of dilutive securities		82		130		133			89

Diluted		20,648		20,584		20,666			20,532

Earnings per common share – continuing operations:
Basic earnings per common share	$	0.76	$	0.80	$	1.91		$	1.59
Diluted earnings per common share		0.75		0.80		1.90			1.58

Other data:
Antidilutive securities excluded from computation of diluted earnings per common share		162		103		151			243

Stock-based Compensation

9 Months Ended

Sep. 30, 2010

Statement [Line Items]

Stock-based Compensation

7. Stock-based Compensation

The amended and restated 2005 Long-Term Incentive Plan (the “LTIP”) provides for the grant to eligible persons of stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares, performance awards, dividend equivalents and other stock-based awards, which are collectively referred to as the awards.

Under the LTIP, the board of directors granted restricted stock units and performance stock units to certain employee participants (collectively, the “stock units”) each year starting in 2007. The restricted stock units vest on the third anniversary of the grant date, assuming continued employment by the participant. The performance stock units vest upon the attainment of the applicable performance objective at the end of a two or three-year period. The applicable performance objective is based upon a multi-year cumulative value creation calculation commencing on the first day of each grant year. The number of performance stock units granted represents the target award and participants have the ability to earn between zero and 150 percent of the target award based upon actual performance. If minimum performance criteria are not achieved, no performance stock units will vest. The performance stock units originally awarded in 2007 vested at 140 percent of target in March 2010 and resulted in a grant of 28,060 performance stock units above target.

In February 2010, the board of directors awarded 32,744 restricted stock units and 68,457 performance stock units to certain employee participants (collectively, the “stock units”) with a grant date of February 22, 2010. The restricted stock units will vest in February 2013, assuming continued employment by the participant. The performance stock units will vest on February 22, 2013 upon the attainment of the applicable performance objective and assuming continued employment by the participant. The applicable performance objective is based upon a two-year cumulative value creation calculation commencing January 1, 2010. The number of performance stock units granted represents the target award and participants have the ability to earn between zero and 150 percent of the target award based upon actual performance. If minimum performance criteria are not achieved, no performance stock units will vest.

Dividends declared on the Company’s common stock during the restriction period of the stock units are credited at equivalent value as additional stock units and become payable as additional common shares upon vesting. In the event of termination of employment, other than retirement, death or disability, any nonvested stock units are forfeited, including additional stock units credited from dividends. In the event of termination of employment due to retirement, death or disability, pro-rata vesting of the stock units over the service period will result. There are special vesting provisions for the stock units related to a change in control.

Compensation expense for nonvested stock units is recorded over the vesting period based on the fair value at the date of grant. The fair value of stock units is the market price of the underlying common stock on the date of grant.

The following table shows a summary of the performance stock units outstanding as of September 30, 2010:


Performance Period	Minimum Shares		Target Shares		Maximum Shares
2008 – 2010		0		46,774		70,161
2009 – 2011		0		141,732		212,598
2010 – 2011		0		68,457		102,686

The following table shows a summary of the status and activity of nonvested stock awards for the nine months ended September 30, 2010:


	Restricted Stock Units			Performance Stock Units			Total Stock Units			Weighted Average Grant Date Fair Value per Unit
Nonvested at January 1, 2010		112,387			256,138			368,525		$	22.50
Granted		32,744			68,457			101,201		$	28.10
Credited from dividends		3,277			7,651			10,928		$	23.15
Performance stock unit adjustment		0			28,060			28,060		$	25.75
Vested		(21,289	)		(98,197	)		(119,486	)	$	25.74
Forfeited		(17	)		(14	)		(31	)	$	32.16
Nonvested September 30, 2010		127,102			262,095			389,197		$	23.04

Stock options to executive officers vest and become exercisable upon the completion of a three-year service period commencing on the grant date. The stock options have a term of 10 years. In the event of termination of employment, other than retirement, death or disability, any nonvested options are forfeited. In the event of termination of employment due to retirement, death or disability, pro-rata vesting of the options over the service period will result. There are special vesting provisions for the stock options related to a change in control.

In accordance with accounting standards, compensation expense for unvested stock options is recorded over the vesting period based on the fair value at the date of grant. The fair value of stock options on the date of grant is calculated using the Black-Scholes-Merton model and the assumptions listed below for unvested stock options:


	August 2010 Grant			February 2010 Grant			February 2009 Grant			February 2008 Grant
Grant date price per share of option award	$	20.00		$	28.10		$	15.26		$	39.99
Expected dividend yield per share		2.50	%		2.50	%		2.50	%		2.00	%
Expected life in years		6.5			6.5			6.5			6.5
Expected volatility		62.00	%		62.00	%		51.00	%		40.67	%
Risk-free interest rate		3.05	%		3.05	%		2.05	%		3.28	%
Grant date fair value per share of option awards	$	9.82		$	13.81		$	6.19		$	14.79

The dividend yield is based on the Company’s current and prospective dividend rate which calculates a continuous dividend yield based upon the market price of the underlying common stock. The expected life in years is based on the simplified method permitted under Securities and Exchange Commission Staff Accounting Bulletin No. 107 which calculates the average of the weighted vesting term and the contractual term of the option. This method was selected due to the lack of historical exercise data with respect to the Company. Expected volatility is based on the historical volatility of the Company’s common stock and

the historical volatility of certain other similar public companies. The risk-free interest rate is based on U.S. Treasury bill rates for the expected life of the option.

The following table shows a summary of the status and activity of stock options for the nine months ended September 30, 2010:


	Options		Weighted Average Exercise Price per Option		Weighted Average Remaining Contractual Term (in years)		Aggregate Intrinsic Value (in millions)
Outstanding at January 1, 2010		246,016	$	23.30
Granted		61,460	$	27.77
Outstanding at September 30, 2010		307,476	$	24.19		8.11	$	1.7
Exercisable at September 30, 2010		57,600	$	29.97		6.49	$	0.0

Total stock-based compensation expense recognized for the three and nine months ended September 30, 2010 and 2009 is as follows:


	Three Months Ended September 30,					Nine Months Ended September 30,
	2010		2009			2010		2009
(Dollars in millions)
Stock-based compensation expense recognized:
Selling, general and administrative expenses	$	0.7	$	(0.5	)	$	2.5	$	1.7
Less related income tax benefit		0.3		(0.2	)		1.0		0.7

	$	0.4	$	(0.3	)	$	1.5	$	1.0

In the third quarter of 2009, the Company reversed a portion of accrued stock-based compensation related to its performance stock unit awards.

For the nine months ended September 30, 2010, shares issued under the LTIP for board of director compensation totaled 21,000 shares. As of September 30, 2010, total future compensation expense related to non-vested stock-based compensation arrangements totaled $4.5 million and the weighted-average period over which this cost is expected to be recognized is approximately 23 months.

Segment Information

9 Months Ended

Sep. 30, 2010

Statement [Line Items]

Segment Information

8. Segment Information

The Company has two reportable segments: Carbon Materials & Chemicals and Railroad & Utility Products. The Company’s reportable segments are business units that offer different products. The reportable segments are each managed separately because they manufacture and distribute distinct products with different production processes. The business units have been aggregated into two reportable segments since management believes the long-term financial performance of these business units is affected by similar economic conditions.

The Company’s Carbon Materials & Chemicals segment is primarily a manufacturer of carbon pitch, naphthalene, phthalic anhydride, creosote, carbon black feedstock and carbon black. Carbon pitch is a critical raw material used in the production of aluminum and for the production of steel in electric arc furnaces. Naphthalene is used for the production of phthalic anhydride and as a surfactant in the production of concrete. Phthalic anhydride is used in the production of plasticizers, polyester resins and alkyd paints. Creosote is used in the treatment of wood and carbon black feedstock is used in the production of carbon black. Carbon black is used primarily in the production of rubber tires.

The Company’s Railroad & Utility Products segment sells treated and untreated wood products and services primarily to the railroad and public utility markets. Railroad products include procuring and treating items such as crossties, switch ties and various types of lumber used for railroad bridges and crossings. Utility products include transmission and distribution poles and pilings.

The Company evaluates performance and determines resource allocations based on a number of factors, the primary measure being operating profit or loss from operations. Operating profit does not include equity in earnings of affiliates, other income, interest expense or income taxes. Operating profit also excludes the operating costs of Koppers Holdings Inc., the parent company of Koppers Inc. The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies. Intersegment transactions are eliminated in consolidation.

The following table sets forth certain sales and operating data, net of all intersegment transactions, for the Company’s segments for the periods indicated:


	Three Months Ended September 30,						Nine Months Ended September 30,
	2010			2009			2010			2009
(Dollars in millions)
Revenues from external customers:
Carbon Materials & Chemicals	$	218.4		$	173.1		$	600.1		$	479.5
Railroad & Utility Products		117.9			116.7			337.6			374.6

Total	$	336.3		$	289.8		$	937.7		$	854.1
Intersegment revenues:
Carbon Materials & Chemicals	$	25.1		$	21.4		$	75.4		$	71.6

Depreciation and amortization expense:
Carbon Materials & Chemicals	$	5.0		$	4.3		$	14.2		$	13.0
Railroad & Utility Products		2.0			1.8			6.2			5.4

Total	$	7.0		$	6.1		$	20.4		$	18.4
Operating profit:
Carbon Materials & Chemicals	$	26.1		$	23.8		$	58.2		$	50.2
Railroad & Utility Products		7.7			10.0			26.3			36.4
Corporate		(0.3	)		(0.6	)		(1.4	)		(1.7	)

Total	$	33.5		$	33.2		$	83.1		$	84.9

The following table sets forth certain tangible and intangible assets allocated to each of the Company’s segments as of the dates indicated:


	September 30, 2010		December 31, 2009
(Dollars in millions)
Segment assets:
Carbon Materials & Chemicals	$	441.8	$	402.2
Railroad & Utility Products		144.9		141.3
All other		70.3		100.9

Total	$	657.0	$	644.4

Goodwill:
Carbon Materials & Chemicals	$	67.4	$	59.4
Railroad & Utility Products		2.4		2.2

Total	$	69.8	$	61.6

Goodwill for Carbon Materials & Chemicals increased $6.9 million from December 31, 2009 as a result of the Koppers Netherlands acquisition before considering foreign currency exchange adjustments.

Income Taxes	9 Months Ended
Income Taxes	Sep. 30, 2010
Statement [Line Items]
Income Taxes	9. Income Taxes Effective Tax Rate Income taxes as a percentage of pretax income was 41.3 percent and 24.8 percent for the three months ended September 30, 2010 and 2009, respectively. Discrete items included in income taxes for the three months ended September 30, 2010 consisted of net tax expense of $0.3 million due to tax return to provision adjustments and changes in unrecognized tax benefits. The effective tax rate, exclusive of discrete items, for the third quarter of 2010 of 40.0 percent differs from the U.S. federal statutory rate of 35.0 percent due to taxes on foreign earnings (+3.5 percent), nondeductible expenses (+1.6 percent) and state taxes (+1.2 percent) partially offset by the domestic manufacturing deduction (-1.7 percent). With respect to the third quarter of 2009, the effective tax rate of 24.8 percent differs from the federal statutory rate primarily due to taxes on foreign earnings (-6.5 percent) and tax return to provision adjustments (-4.8 percent). The impact on taxes on foreign earnings in 2009’s third quarter is primarily due to the decision to not repatriate 2009’s earnings from Europe. Income taxes as a percentage of pretax income was 38.8 percent and 36.2 percent for the nine months ended September 30, 2010 and 2009, respectively. Discrete items included in income taxes for the nine months ended September 30, 2010 was a net tax expense of $0.3 million due to tax return to provision adjustments and changes in unrecognized tax benefits. The effective tax rate, exclusive of discrete items, for the first nine months of 2010 of 38.2 percent differs from the U.S. federal statutory rate of 35.0 percent primarily due to taxes on foreign earnings (+2.1 percent), nondeductible expenses (+1.3 percent) and state taxes (+0.9 percent) partially offset by the domestic manufacturing deduction (-1.9 percent). With respect to the first nine months of 2009, the effective tax rate of 36.2 percent differs from the federal statutory rate primarily due to taxes on foreign earnings (+2.0 percent) and state taxes (+1.6 percent) partially offset by the domestic manufacturing deduction (-1.7 percent). The income tax provision for interim periods is based on an estimated annual effective tax rate, which requires management to make its best estimate of annual pretax income by domestic and foreign jurisdictions and other items that impact taxable income. During the year, management regularly updates estimates based on changes in various factors such as product prices, shipments, product mix, operating and administrative costs, earnings mix by taxable jurisdiction, repatriation of foreign earnings, uncertain tax positions and the ability to claim tax credits. To the extent that actual results vary from the estimates at the end of the third quarter, the actual tax provision recognized for 2010 could be materially different from the forecasted annual tax provision as of the end of the third quarter. Uncertain Tax Positions The Company or one of its subsidiaries files income tax returns in U.S. federal jurisdiction, individual U.S. state jurisdictions and non-U.S. jurisdictions. With few exceptions, the Company is no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 2004. As of September 30, 2010 and December 31, 2009, the total amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate, was approximately $3.4 million and $3.3 million, respectively. Unrecognized tax benefits totaled $4.1 million and $4.0 million as of September 30, 2010 and December 31, 2009, respectively. The Company recognizes interest expense and any related penalties from uncertain tax positions in income tax expense. As of September 30, 2010 and December 31, 2009, the Company had accrued approximately $0.7 million.

Inventories

9 Months Ended

Sep. 30, 2010

Statement [Line Items]

Inventories

10. Inventories

Net inventories as of September 30, 2010 and December 31, 2009 are summarized in the table below:


	September 30, 2010		December 31, 2009
(Dollars in millions)
Raw materials	$	97.3	$	94.3
Work in process		7.7		8.3
Finished goods		90.1		94.9

		195.1		197.5
Less revaluation to LIFO		43.8		44.8

Net	$	151.3	$	152.7

Property, Plant and Equipment

9 Months Ended

Sep. 30, 2010

Statement [Line Items]

Property, Plant and Equipment

11. Property, Plant and Equipment

Property, plant and equipment as of September 30, 2010 and December 31, 2009 are summarized in the table below:


	September 30, 2010		December 31, 2009
(Dollars in millions)
Land	$	7.5	$	7.5
Buildings		35.3		29.3
Machinery and equipment		588.3		491.0

		631.1		527.8
Less accumulated depreciation		476.1		378.5

Net	$	155.0	$	149.3

Pensions and Postretirement Benefit Plans

9 Months Ended

Sep. 30, 2010

Statement [Line Items]

Pensions and Postretirement Benefit Plans

12. Pensions and Postretirement Benefit Plans

The Company and its subsidiaries maintain a number of defined benefit and defined contribution plans to provide retirement benefits for employees in the U.S., as well as employees outside the U.S. These plans are maintained and contributions are made in accordance with the Employee Retirement Income Security Act of 1974 (“ERISA”), local statutory law or as determined by the board of directors. The defined benefit pension plans generally provide benefits based upon years of service and compensation. Pension plans are funded except for three domestic non-qualified defined benefit pension plans for certain key executives.

All qualified defined benefit pension plans for salaried employees have been closed to new participants and a number of plans, including a number of plans for hourly employees, have been frozen. Accordingly, these pension plans no longer accrue additional years of service or recognize future increases in compensation for benefit purposes. In addition, a number of pension plans are subject to a “soft” freeze which precludes new employees from entering the defined benefit pension plans.

The following table provides the components of net periodic benefit cost for the pension plans for the three and nine months ended September 30, 2010 and 2009:


	Three Months Ended September 30,						Nine Months Ended September 30,
	2010			2009			2010			2009
(Dollars in millions)
Service cost	$	0.8		$	0.6		$	2.4		$	2.0
Interest cost		3.0			2.7			8.6			7.9
Expected return on plan assets		(2.5	)		(2.0	)		(7.4	)		(6.2	)
Amortization of prior service cost		0.0			0.0			0.1			0.2
Amortization of net loss		1.3			1.5			3.9			4.7
Amortization of transition asset		(0.1	)		0.0			(0.2	)		(0.2	)

Net periodic benefit cost	$	2.5		$	2.8		$	7.4		$	8.4

The defined contribution plans generally provide retirement assets to employee participants based upon employer and employee contributions to the participant’s individual investment account. The Company also provides retiree medical insurance coverage to certain U.S. employees and a retiree life insurance benefit to most U.S. employees. For salaried employees, the retiree medical and retiree insurance plans have been closed to new participants.

Expense related to the Company’s defined contribution plans totaled $1.1 million and $0.6 million for the three months ended September 30, 2010 and 2009, respectively and $3.7 million and $1.8 million for the nine months ended September 30, 2010 and 2009, respectively. Expense related to the Company’s other postretirement benefit plans other than pensions totaled $0.2 million for each of the three months ended September 30, 2010 and 2009 and $0.6 million for each of the nine months ended September 30, 2010 and 2009.

Debt

9 Months Ended

Sep. 30, 2010

Statement [Line Items]

Debt

13. Debt

Debt at September 30, 2010 and December 31, 2009 was as follows:


	Weighted Average Interest Rate		Maturity		September 30, 2010		December 31, 2009
(Dollars in millions)
Revolving Credit Facility		0.00%		2013	$	0.0	$	40.0
Senior Notes		7⁷/8%		2019		295.2		295.0
Other debt, including capital leases		8.00%		Various		0.9		0.3

Total debt						296.1		335.3
Less short term debt and current maturities of long-term debt						0.2		0.2

Long-term debt					$	295.9	$	335.1

Revolving Credit Facility

The Koppers Inc. revolving credit facility agreement provides for a revolving credit facility of up to $300.0 million at variable rates. Borrowings under the revolving credit facility are secured by a first priority lien on substantially all of Koppers Inc.’s assets. The credit facility contains certain covenants that restrict Koppers Inc.’s ability to incur additional indebtedness, create liens on its assets, pay dividends and make capital expenditures, investments or acquisitions. In addition, such covenants give rise to events of default upon the failure by Koppers Inc. to meet certain financial ratios. Commitment fees totaled $0.4 million and $0.5 million for the three months ended September 30, 2010 and 2009, respectively, and $1.0 million and $1.6 million for the nine months ended September 30, 2010 and 2009, respectively. Commitment fees are charged to interest expense.

As of September 30, 2010, the Company had $236.9 million of unused revolving credit availability after restrictions from certain letter of credit commitments and other covenants. As of September 30, 2010, $11.3 million of commitments were utilized by outstanding letters of credit.

Senior Notes

The Koppers Inc. 7⁷/8 percent Senior Notes due 2019 (the “Senior Notes”) were issued on December 1, 2009 at an offering price of 98.311 percent of face value, or $294.9 million and have a principal amount at maturity of $300.0 million. The Senior Notes have an effective interest rate yield of 8¹/8 percent per annum. The Senior Notes are unsecured senior obligations that are fully and unconditionally guaranteed by Koppers Holdings and certain of Koppers Inc.’s wholly-owned domestic subsidiaries. The Senior Notes are structurally subordinated to indebtedness under the revolving credit facility.

Interest on the Senior Notes is payable semiannually on December 1 and June 1 each year, starting on June 1, 2010. On or after December 1, 2014, the Company is entitled to redeem all or a portion of the Senior Notes at a redemption price of 103.938 percent of principal value, declining annually in ratable amounts until the redemption price is equivalent to the principal value on December 1, 2017.

The indenture governing the Senior Notes includes customary covenants that restrict, among other things, the ability of Koppers Inc. and its restricted subsidiaries to incur additional debt, pay dividends or make certain other restricted payments, incur liens, merge or sell all or substantially all of the assets of Koppers Inc. or its subsidiaries or enter into various transactions with affiliates.

Guarantees

The Company’s 60-percent owned subsidiary in China has issued a guarantee of $18.3 million in support of the Company’s 30-percent investment in Tangshan Koppers Kailuan Carbon Chemical Company Limited (“TKK”). The guarantee relates to bank debt incurred by TKK which matures in 2011.

Asset Retirement Obligations

9 Months Ended

Sep. 30, 2010

Statement [Line Items]

Asset Retirement Obligations

14. Asset Retirement Obligations

The Company recognizes asset retirement obligations for the removal and disposal of residues; dismantling of certain tanks required by governmental authorities; cleaning and dismantling costs for owned rail cars; and cleaning costs for leased rail cars and barges. The following table reflects changes in the carrying values of asset retirement obligations:


	September 30, 2010			December 31, 2009
(Dollars in millions)
Balance at beginning of year	$	16.6		$	16.2
Accretion expense		1.0			1.2
Revision in estimated cash flows, net		0.4			0.6
Expenses incurred		(1.6	)		(1.6	)
Currency translation		(0.1	)		0.2

Balance at end of period	$	16.3		$	16.6

Deferred Revenue from Extended Product Warranty Liabilities

9 Months Ended

Sep. 30, 2010

Statement [Line Items]

Deferred Revenue from Extended Product Warranty Liabilities

15. Deferred Revenue from Extended Product Warranty Liabilities

The Company defers revenues associated with extended product warranty liabilities based on historical loss experience and sales of extended warranties on certain products. The following table reflects changes in the carrying values of deferred revenue:


	September 30, 2010			December 31, 2009
(Dollars in millions)
Balance at beginning of year	$	6.7		$	7.5
Deferred revenue for sales of extended warranties		0.1			0.3
Revenue earned		(0.8	)		(1.1	)

Balance at end of period	$	6.0		$	6.7

Commitments and Contingent Liabilities

9 Months Ended

Sep. 30, 2010

Statement [Line Items]

Commitments and Contingent Liabilities

16. Commitments and Contingent Liabilities

Koppers Inc. and its subsidiaries are involved in litigation and various proceedings relating to environmental laws and regulations and toxic tort, product liability and other matters. Certain of these matters are discussed below. The ultimate resolution of these contingencies is subject to significant uncertainty and should the Company fail to prevail in any of these legal matters or should several of these legal matters be resolved against the Company in the same reporting period, these legal matters could, individually or in the aggregate, be material to the consolidated financial statements.

Legal Proceedings

Coal Tar Pitch Cases. Koppers Inc., along with other defendants, is currently a defendant in lawsuits filed in four states in which the plaintiffs claim they suffered a variety of illnesses (including cancer) as a result of exposure to coal tar pitch sold by the defendants. There are 116 plaintiffs in 63 cases pending as of September 30, 2010 as compared to 112 plaintiffs in 62 cases at December 31, 2009. As of September 30, 2010, there are a total of 59 cases pending in state court in Pennsylvania, one case each pending in state courts in Tennessee and Illinois, and two cases pending in an Indiana state court.

The plaintiffs in all 63 pending cases seek to recover compensatory damages, while plaintiffs in 53 cases also seek to recover punitive damages. The plaintiffs in the 59 cases filed in Pennsylvania state court seek unspecified damages in excess of the court’s minimum jurisdictional limit. The plaintiffs in the two cases filed in Indiana state court also seek damages in an unspecified amount. The plaintiffs in the Tennessee state court case each seek damages of $15.0 million. The plaintiff in the Illinois state court case seeks compensatory damages in excess of $50,000.

The other defendants in these lawsuits vary from case to case and include companies such as Beazer East, Inc., United States Steel Corporation, Honeywell International Inc., Vertellus Specialties Inc., Dow Chemical Company, Rust-Oleum Corporation, UCAR Carbon Company, Inc., Exxon Mobil Corporation, Chemtura Corporation, SGL Carbon Corporation, Alcoa, Inc., and PPG Industries, Inc. Discovery is proceeding in these cases.

The Company has not provided a reserve for these lawsuits because, at this time, the Company cannot reasonably determine the probability of a loss, and the amount of loss, if any, cannot be reasonably estimated. The timing of resolution of these cases cannot be reasonably determined. Although Koppers Inc. is vigorously defending these cases, an unfavorable resolution of these matters may have a material adverse effect on the Company’s business, financial condition, cash flows and results of operations. No trial dates have been set in any of these cases.

Somerville Cases. Koppers Inc. is currently defending five sets of state court cases in Texas (Antu, Baade, Davis, Hensen and Moses) involving approximately 130 plaintiffs who allegedly have worked or resided in Somerville, Texas, where Koppers Inc. has operated a wood treatment plant since 1995. Koppers Inc. has been named, but not served, as a defendant in another Texas state court case (Asselin) involving 11 plaintiffs who allegedly worked or resided in Somerville, Texas. These cases are pending in Burleson County, Texas, and Tarrant County, Texas. In addition to those Texas state court cases, Koppers Inc. is defending another state court case (Gonzalez) that is pending in the Circuit Court of Cook County, Illinois. The Gonzalez case initially involved 28 plaintiffs who allegedly worked or resided in Somerville, Texas. The court has dismissed 22 of the Gonzalez plaintiffs’ claims and an appeal regarding the dismissal of those claims is pending. The BNSF Railway Company (“BNSF”) has also been named as a defendant in these cases. The complaints allege that plaintiffs have suffered personal injuries (including death, in some cases) resulting from exposure to wood preservative chemicals used at the Somerville, Texas wood treatment plant. The complaints in the Moses, Davis and Asselin cases additionally allege that plaintiffs have suffered property damage.

The complaints seek to recover various damages for each plaintiff, including compensatory and punitive damages within the jurisdictional limits of the court for, among other things, bodily injuries, pain and mental anguish, emotional distress, medical monitoring, medical expenses, diminished earning capacity, permanent disability, physical impairment and/or disfigurement, loss of companionship and society, loss of consortium, devaluation of property, loss of use and enjoyment of personal property, loss of use and enjoyment of real property, property damage, property remediation costs, funeral and burial expenses and lost wages.

There are a total of 35 plaintiffs in the Moses cases. There are a total of ten plaintiffs in the Antu case, four of whom have claims pending against only the BNSF. The Hensen case identifies a total of 65 plaintiffs, two of whom have claims pending against only the BNSF. The Davis case involves one plaintiff. There are a total of 25 plaintiffs in the Baade case.

In addition to the cases pending in state court, Koppers Inc. was defending one case, Bullard, in the United States District Court for the Western District of Texas involving a total of four plaintiffs. In August 2010, this case was dismissed without prejudice.

Currently, two of the cases severed from Moses and involving Koppers Inc. have case management orders which stipulate that all discovery is to be completed by early 2011. No trial dates have been set in those cases. No other cases pending against Koppers Inc. have discovery completion dates or trial dates.

The Company has not provided a reserve for these matters because, at this time, it cannot reasonably determine the probability of a loss, and the amount of loss, if any, cannot be reasonably estimated. The timing of resolution of these cases cannot be reasonably determined. Although Koppers Inc. is vigorously defending these cases, an unfavorable resolution of these matters may have a material adverse effect on the Company’s business, financial condition, cash flows and results of operations.

Grenada – All Cases. Koppers Inc., together with various co-defendants (including Beazer East), has been named as a defendant in toxic tort lawsuits in federal court in Mississippi (see “Grenada – Federal Court Cases” below) and in state court in Mississippi (see “Grenada – State Court Cases” below) arising from the operation of the Grenada facility. The complaints allege that plaintiffs were exposed to harmful levels of various toxic chemicals, including creosote, pentachlorophenol, polycyclic aromatic hydrocarbons and dioxin, as a result of soil, surface water and groundwater contamination and air emissions from the Grenada facility. Based on the experience of Koppers Inc. in defending previous toxic tort cases, the Company does not believe that the damages sought by the plaintiffs in the state and federal court cases are supported by the facts of the cases. The Company has not provided a reserve for these lawsuits because, at this time, it cannot reasonably determine the probability of a loss, and the amount of loss, if any, cannot be reasonably estimated. The timing of resolution of these cases cannot be reasonably determined. Although Koppers Inc. is vigorously defending these cases, an unfavorable resolution of these matters may have a material adverse effect on the Company’s business, financial condition, cash flows and results of operations. See “Environmental and Other Liabilities Retained or Assumed by Others” for additional information.

Grenada – Federal Court Cases.

Beck Case – The complaint in this case was originally filed by approximately 110 plaintiffs. Pursuant to an order granting defendants’ motion to sever, the court dismissed the claims of 98 plaintiffs in the Beck case without prejudice to their right to re-file their complaints. In December 2005, 94 of the 98 plaintiffs in the Beck case whose claims were dismissed re-filed their complaints. The plaintiffs in the 94 cases that were re-filed seek compensatory damages from the defendants of at least $5.0 million for each of eight counts and punitive damages of at least $10.0 million for each of three counts (in addition to damages in an unspecified amount for alleged trespass and nuisance). No discovery orders have been issued with respect to the 94 additional cases. The claims of eight of the 12 plaintiffs whose claims were not dismissed are still pending. The eight remaining plaintiffs seek compensatory damages from the defendants in an unspecified amount and punitive damages of $20.0 million for each of four counts.

The first of these trials occurred in 2006 and, after an appeal, the court ultimately rendered a judgment in favor of Koppers Inc. In January 2010, the trial court granted summary judgment in favor of Koppers Inc. on all claims for the second trial plaintiff. A trial date was set for August 8, 2011 for the third trial plaintiff, but on August 5, 2010 the district court dismissed with prejudice that case as well as the next plaintiff after that who was scheduled to be tried. At this date no trial plaintiff has been selected for the next trial. On September 17, 2010, the Court ordered the parties to participate in mediation applicable for all of the Grenada cases, which is now scheduled for December 2, 2010.

Ellis Case – There are approximately 1,200 plaintiffs in this case. Each plaintiff seeks compensatory damages from the defendants of at least $5.0 million for each of seven counts and punitive damages of at least $10.0 million for each of three counts (in addition to damages for an unspecified amount for trespass and nuisance). The Ellis complaint also requests injunctive relief. These cases have been stayed and no trial dates have been scheduled pending the completion of the trials for the remaining eight plaintiffs in the Beck case. The timing of the resolution of these cases is not known at this time. On October 15, 2010, the Court granted the plaintiff’s motion to dismiss, with prejudice, nine of the Ellis claimants.

Grenada – State Court Cases. The state court cases were brought on behalf of approximately 200 plaintiffs in five counties in Mississippi. Each plaintiff seeks compensatory damages from the defendants of at least $5.0 million for each of up to eight counts and punitive damages of at least $10.0 million for each of three counts. Certain plaintiffs also seek damages for alleged trespass and private nuisance in unspecified amounts together with injunctive relief. The Mississippi Supreme Court ordered that the claims of the plaintiffs in the pending state court cases filed in counties other than Grenada County (approximately 110 cases) be severed and transferred to Grenada County. Plaintiffs’ counsel attempted to transfer ten such cases to Grenada County, but all ten cases were dismissed by the Court in Grenada County. Plaintiffs’ counsel has not attempted to transfer any additional cases to Grenada County and defendants have filed motions to dismiss the claims of the remaining plaintiffs in the four non-Grenada County cases, which motions remain pending. No trial dates have been scheduled in these cases. The timing of the resolution of these cases is not known at this time.

With respect to the state court case that was originally filed in Grenada County, the plaintiffs filed 104 individual complaints in Grenada County. After dismissals and other procedural and substantive motions, one case filed in Grenada County remains pending. The Mississippi Supreme Court recently affirmed the entry of summary judgment in favor of Koppers Inc. based on the state statute of limitations in 40 of the cases, and an appeal is pending on the entry of summary judgment and the dismissal of 18 additional plaintiffs. The Company has not provided a reserve for these lawsuits because, at this time, the Company cannot reasonably determine the probability of a loss, and the amount of loss, if any, cannot be reasonably estimated. The timing of resolution of these cases cannot be reasonably determined. Although Koppers Inc. is vigorously defending these cases, an unfavorable resolution of these matters may have a material adverse effect on the Company’s business, financial condition, cash flows and results of operations. No trial dates have been set in any of these cases.

Gainesville. In April 2010, a class action complaint was filed in the United States District Court for the Northern District of Florida, by residents of Gainesville, Florida which named Koppers Inc. Beazer East and Cabot Corporation, Inc. as defendants. In October 2010, an amended class action complaint was filed which added the Company and Beazer Limited as defendants and dropped Cabot Corporation as a defendant. The plaintiffs purport to represent anyone who has owned property or lived within a two mile radius of the defendants’ former utility pole treatment plant and an adjacent site owned by Cabot Corporation. The plaintiffs allege that their property has been contaminated by various toxic substances. Koppers Inc. operated a utility pole treatment plant in Gainesville from 1988 until its closure late in 2009. The property upon which the utility pole treatment plant was located was sold by Koppers Inc. to Beazer East, Inc. in the first quarter of 2010. Prior to 1988, Beazer East, Inc. conducted various wood treating operations at the utility pole treatment plant site. The plaintiffs allege that their property’s value has been impacted and that they are at an increased risk of developing adverse health effects as a result of the alleged contamination. Plaintiffs seek, among other things, class certification, the creation and funding of comprehensive community property remediation and medical monitoring programs, compensatory and punitive damages in excess of the minimum jurisdictional limit of the Court and other equitable relief. No trial date has been set.

The Company has not provided a reserve for this matter because, at this time, it cannot reasonably determine the probability of a loss, and the amount of loss, if any, cannot be reasonably estimated. The timing of resolution of this case cannot be reasonably determined. Although Koppers Inc. is vigorously defending this case, an unfavorable resolution of this matter may have a material adverse effect on the Company’s business, financial condition, cash flows and results of operations.

Environmental and Other Litigation Matters

The Company and its subsidiaries are subject to federal, state, local and foreign laws and regulations and potential liabilities relating to the protection of the environment and human health and safety including, among other things, the cleanup of contaminated sites, the treatment, storage and disposal of wastes, the discharge of effluent into waterways, the emission of substances into the air and various health and safety matters. The Company’s subsidiaries expect to incur substantial costs for ongoing compliance with such laws and regulations. The Company’s subsidiaries may also face governmental or third-party claims, or otherwise incur costs, relating to cleanup of, or for injuries resulting from, contamination at sites associated with past and present operations. The Company accrues for environmental liabilities when a determination can be made that a liability is probable and reasonably estimable.

Environmental and Other Liabilities Retained or Assumed by Others. The Company’s subsidiaries have agreements with former owners of certain of their operating locations under which the former owners retained, assumed and/or agreed to indemnify such subsidiaries against certain environmental and other liabilities. The most significant of these agreements was entered into at Koppers Inc.’s formation on December 29, 1988 (the “Acquisition”). Under the related asset purchase agreement between Koppers Inc. and Beazer East, subject to certain limitations, Beazer East retained the responsibility for and agreed to indemnify Koppers Inc. against certain liabilities, damages, losses and costs, including, with certain limited exceptions, liabilities under and costs to comply with environmental laws to the extent attributable to acts or omissions occurring prior to the Acquisition and liabilities related to products sold by Beazer East prior to the Acquisition (the “Indemnity”). Beazer Limited, the parent company of Beazer East, unconditionally guaranteed Beazer East’s performance of the Indemnity pursuant to a guarantee (the “Guarantee”). In 1998, the parent company of Beazer East purchased an insurance policy under which the funding and risk of certain environmental and other liabilities relating to the former Koppers Company, Inc. operations of Beazer East (which includes locations purchased from Beazer East by Koppers Inc.) are underwritten by Centre Solutions (a member of the Zurich Group) and Swiss Re. Beazer East is a wholly-owned, indirect subsidiary of Heidelberg Cement AG. The Indemnity provides different mechanisms, subject to certain limitations, by which Beazer East is obligated to indemnify Koppers Inc. with regard to certain environmental, product and other liabilities and imposes certain conditions on Koppers Inc. before receiving such indemnification, including, in some cases, certain limitations regarding the time period as to which claims for indemnification can be brought. In July 2004, Koppers Inc. and Beazer East agreed to amend the environmental indemnification provisions of the December 29, 1988 asset purchase agreement to extend the indemnification period for pre-closing environmental liabilities through July 2019. As consideration for the amendment, Koppers Inc. paid Beazer East a total of $7.0 million and agreed to share toxic tort litigation defense costs arising from any sites acquired from Beazer East. The July 2004 amendment did not change the provisions of the Indemnity with respect to indemnification for non-environmental claims, such as product liability claims, which claims may continue to be asserted after July 2019.

Qualified expenditures under the Indemnity are not subject to a monetary limit. Qualified expenditures under the Indemnity include (i) environmental cleanup liabilities required by third parties, such as investigation, remediation and closure costs, relating to pre-December 29, 1988, or Pre-Closing, acts or omissions of Beazer East or its predecessors; (ii) environmental claims by third parties for personal injuries, property damages and natural resources damages relating to Pre-Closing acts or omissions of Beazer East or its predecessors; (iii) punitive damages for the acts or omissions of Beazer East and its predecessors without regard to the date of the alleged conduct and (iv) product liability claims for products sold by Beazer East or its predecessors without regard to the date of the alleged conduct. If the third party claims described in sections (i) and (ii) above are not made by July 2019, Beazer East will not be required to pay the costs arising from such claims under the Indemnity. However, with respect to any such claims which are made by July 2019, Beazer East will continue to be responsible for such claims under the Indemnity beyond July 2019. The Indemnity provides for the resolution of issues between Koppers Inc. and Beazer East by an arbitrator on an expedited basis upon the request of either party. The arbitrator could be asked, among other things, to make a determination regarding the allocation of environmental responsibilities between Koppers Inc. and Beazer East. Arbitration decisions under the Indemnity are final and binding on the parties.

Contamination has been identified at most manufacturing and other sites of the Company’s subsidiaries. Three sites currently owned and operated by Koppers Inc. in the United States are listed on the National Priorities List promulgated under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended (“CERCLA”). Currently, at the properties acquired from Beazer East (which include all of the National Priorities List sites and all but one of the sites permitted under the Resource Conservation and Recovery Act (“RCRA”)), a significant portion of all investigative, cleanup and closure activities are being conducted and paid for by Beazer East pursuant to the terms of the Indemnity. In addition, other of Koppers Inc.’s sites are or have been operated under RCRA and various other environmental permits, and remedial and closure activities are being conducted at some of these sites.

To date, the parties that retained, assumed and/or agreed to indemnify the Company against the liabilities referred to above, including Beazer East, have performed their obligations in all material respects. The Company believes that, for the last three years, amounts paid by Beazer East as a result of its environmental remediation obligations under the Indemnity have averaged in total approximately $11 million per year. Periodically, issues have arisen between Koppers Inc. and Beazer East and/or other indemnitors that have been resolved without arbitration. Koppers Inc. and Beazer East engage in discussions from time to time that involve, among other things, the allocation of environmental costs related to certain operating and closed facilities.

If for any reason (including disputed coverage or financial incapability) one or more of such parties fail to perform their obligations and the Company or its subsidiaries are held liable for or otherwise required to pay all or part of such liabilities without reimbursement, the imposition of such liabilities on the Company or its subsidiaries could have a material adverse effect on its business, financial condition, cash flows and results of operations. Furthermore, the Company could be required to record a contingent liability on its balance sheet with respect to such matters, which could result in a negative adjustment to the Company’s net worth.

Domestic Environmental Matters. Koppers Inc. has been named as a potentially responsible party (a “PRP”) at the Portland Harbor CERCLA site located on the Willamette River in Oregon. Koppers Inc. has replied to an EPA Information request and has executed a PRP agreement which outlines the process to develop an allocation of past and future costs. The current estimate for past costs incurred in the remedial investigation/feasibility study is approximately $100 million. Koppers Inc. currently operates a coal tar pitch terminal near the site. Koppers Inc. has accrued its estimated cost of participation in the PRP group. Separate from the EPA activities, a natural resources damages assessment is being conducted by a local trustee group. In September 2009, Koppers Inc. received a general notice letter notifying it that it may be a PRP at the Newark Bay CERCLA site. In January 2010, Koppers Inc. submitted a response to the general notice letter asserting that Koppers Inc. is a de minimus party at this site. Other than the estimated cost of participating in the PRP group at the Portland Harbor CERCLA site, the Company has not provided a reserve for these matters because, at this time, it cannot reasonably determine the probability of a loss, and the amount of loss, if any, cannot be reasonably estimated. An unfavorable resolution of these matters may have a material adverse effect on the Company’s business, financial condition, cash flows and results of operations.

The Illinois Environmental Protection Agency (the “IEPA”) has requested that Koppers Inc. conduct a voluntary investigation of soil and groundwater at its Stickney, Illinois carbon materials and chemicals facility. Koppers Inc. is also conducting an investigation of soil and groundwater at a leased terminal site located adjacent to the Stickney facility. Koppers Inc. is conducting such investigations in cooperation with Beazer East. The Company has provided a reserve for this matter totaling $0.8 million as of September 30, 2010.

In August 2005, the Pennsylvania Department of Environmental Protection (the “PADEP”) proposed a fine related to alleged water discharge exceedances from a storm water sewer pipe at the tar distillation facility of Koppers Inc. in Clairton, Pennsylvania. In July 2010, Koppers Inc. reached a final settlement of the fine with the PADEP and executed a consent order with the PADEP. Koppers Inc. also agreed to undertake certain engineering and capital improvements and agreed to contribute the capital improvements, primarily a new sewer line, to the city of Clairton. Accordingly, Koppers Inc. has provided a reserve of $1.9 million related to the new sewer line and PADEP fine as of September 30, 2010. Koppers Inc. began construction of the new sewer line during the third quarter of 2010.

Australian Environmental Matters. Soil and groundwater contamination has been detected at certain of the Company’s Australian facilities. At the Company’s tar distillation facility in Newcastle, New South Wales, Australia, soil contamination from an abandoned underground coal tar pipeline and other groundwater contamination have been detected at a property adjacent to the facility. In December 2006 the Company and the owner of the adjacent property reached an agreement in principle pursuant to which the Company will contribute $1.8 million and the owner of the adjacent property will contribute $6.5 million toward remediation of the property. Subject to the approval of a remediation action plan by local environmental authorities, the agreement in principle provides that the Company will assume responsibility for the management of the remediation effort and will indemnify the current owner for any remediation costs in excess of its agreed contribution. At the completion of the remediation, the agreement in principle provides that the property will be transferred to the Company. The Company has reserved its expected total remediation costs of $1.8 million at September 30, 2010.

Other Australian environmental matters include soil and groundwater remediation at a number of current and former facilities in Australia. With respect to a closed facility in Thornton, Australia, the sale of the property was completed in March 2010 and the buyer assumed all remediation liability. Accordingly, the accrual for remediation at this site was reversed in the nine months ended September 30, 2010 and resulted in a decrease to cost of sales of $2.9 million. The Company has reserved $1.3 million for remediation costs at the remaining Australian sites.

Environmental Reserves Rollforward. The following table reflects changes in the accrued liability for environmental matters:


	September 30, 2010			December 31, 2009
(Dollars in millions)
Balance at beginning of year	$	10.7		$	9.4
Expense		0.4			0.5
Reversal of reserves		(4.3	)		0.0
Cash expenditures		(0.6	)		(0.5	)
Currency translation		0.3			1.3

Balance at end of period	$	6.5		$	10.7

Subsidiary Guarantor Information for Koppers Inc. Senior Notes

9 Months Ended

Sep. 30, 2010

Statement [Line Items]

Subsidiary Guarantor Information for Koppers Inc. Senior Notes

17. Subsidiary Guarantor Information for Koppers Inc. Senior Notes

On December 1, 2009, Koppers Inc. issued $300.0 million principal value of Senior Notes. Koppers Holdings and each of Koppers Inc.’s wholly-owned material domestic subsidiaries other than Koppers Assurance, Inc. fully and unconditionally guarantee the payment of principal and interest on the Senior Notes. The domestic guarantor subsidiaries include World-Wide Ventures Corporation, Koppers Delaware, Inc., Koppers Concrete Products, Inc., Concrete Partners, Inc., Koppers Ventures LLC and Koppers Asia LLC.

Separate condensed consolidating financial statement information for Koppers Holdings Inc. (the parent), Koppers Inc., domestic guarantor subsidiaries and non-guarantor subsidiaries as of September 30, 2010 and 2009 and for the three and nine months ended September 30, 2010 and 2009 is as follows:

Condensed Consolidating Statement of Operations

For the Three Months Ended September 30, 2010


	Parent			Koppers Inc.		Domestic Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Adjustments			Consolidated
(Dollars in millions)
Net sales	$	0.0		$	196.1	$	10.2		$	135.5	$	(5.5	)	$	336.3
Cost of sales including depreciation and amortization		0.0			171.4		(1.3	)		114.9		2.4			287.4
Selling, general and administrative		0.3			8.1		0.3			6.7		0.0			15.4

Operating profit (loss)		(0.3	)		16.6		11.2			13.9		(7.9	)		33.5
Other income (expense)		15.8			0.0		(0.1	)		0.1		(15.8	)		0.0
Interest expense (income)		(0.1	)		7.0		0.0			0.9		(1.2	)		6.6
Income taxes		0.0			8.0		0.1			3.0		0.0			11.1

Income from continuing operations		15.6			1.6		11.0			10.1		(22.5	)		15.8
Discontinued operations		0.0			0.0		0.0			0.0		0.0			0.0
Noncontrolling interests		0.0			0.0		0.0			0.2		0.0			0.2

Net income attributable to Koppers	$	15.6		$	1.6	$	11.0		$	9.9	$	(22.5	)	$	15.6

Condensed Consolidating Statement of Operations

For the Three Months Ended September 30, 2009


	Parent			Koppers Inc.		Domestic Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
(Dollars in millions)
Net sales	$	0.0		$	179.0	$	5.6		$	114.5		$	(9.3	)	$	289.8
Cost of sales including depreciation and amortization		0.0			156.0		(7.9	)		94.8			0.7			243.6
Selling, general and administrative		0.6			5.7		0.4			6.3			0.0			13.0

Operating profit (loss)		(0.6	)		17.3		13.1			13.4			(10.0	)		33.2
Other income (expense)		20.1			0.0		0.0			(0.3	)		(20.1	)		(0.3	)
Interest expense (income)		5.1			5.4		0.0			0.8			(1.3	)		10.0
Income taxes		(2.0	)		4.2		0.1			3.5			0.0			5.8

Income from continuing operations		16.4			7.7		13.0			8.8			(28.8	)		17.1
Discontinued operations		0.0			0.0		0.0			0.0			0.0			0.0
Noncontrolling interests		0.0			0.0		0.0			0.7			0.0			0.7

Net income attributable to Koppers	$	16.4		$	7.7	$	13.0		$	8.1		$	(28.8	)	$	16.4

Condensed Consolidating Statement of Operations

For the Nine Months Ended September 30, 2010


	Parent			Koppers Inc.			Domestic Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Adjustments			Consolidated
(Dollars in millions)
Net sales	$	0.0		$	549.8		$	35.3		$	381.2	$	(28.6	)	$	937.7
Cost of sales including depreciation and amortization		0.0			490.8			12.8			319.6		(16.4	)		806.8
Selling, general and administrative		1.4			24.0			2.8			19.6		0.0			47.8

Operating profit (loss)		(1.4	)		35.0			19.7			42.0		(12.2	)		83.1
Other income (expense)		39.9			0.1			(0.3	)		2.0		(39.9	)		1.8
Interest expense (income)		(0.1	)		21.0			0.0			3.1		(3.6	)		20.4
Income taxes		(0.4	)		15.6			0.3			9.5		0.0			25.0

Income (loss) from continuing operations		39.0			(1.5	)		19.1			31.4		(48.5	)		39.5
Discontinued operations		0.0			0.0			(0.2	)		0.0		0.0			(0.2	)
Noncontrolling interests		0.0			0.0			0.0			0.3		0.0			0.3

Net income (loss) attributable to Koppers	$	39.0		$	(1.5	)	$	18.9		$	31.1	$	(48.5	)	$	39.0

Condensed Consolidating Statement of Operations

For the Nine Months Ended September 30, 2009


	Parent			Koppers Inc.			Domestic Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
(Dollars in millions)
Net sales	$	0.0		$	564.1		$	22.6		$	300.7		$	(33.3	)	$	854.1
Cost of sales including depreciation and amortization		0.0			495.0			(3.1	)		253.7			(17.3	)		728.3
Selling, general and administrative		1.7			20.5			1.2			17.5			0.0			40.9

Operating profit (loss)		(1.7	)		48.6			24.5			29.5			(16.0	)		84.9
Other income (expense)		42.8			0.2			(0.2	)		(0.5	)		(42.8	)		(0.5	)
Interest expense (income)		14.5			16.7			0.0			2.7			(3.7	)		30.2
Income taxes		(5.6	)		17.4			0.2			7.7			0.0			19.7

Income from continuing operations		32.2			14.7			24.1			18.6			(55.1	)		34.5
Discontinued operations		0.0			(0.3	)		0.0			0.0			0.0			(0.3	)
Noncontrolling interests		0.0			0.0			0.0			2.0			0.0			2.0

Net income attributable to Koppers	$	32.2		$	14.4		$	24.1		$	16.6		$	(55.1	)	$	32.2

Condensed Consolidating Balance Sheet

September 30, 2010


	Parent		Koppers Inc.			Domestic Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Adjustments			Consolidated
(Dollars in millions)
ASSETS
Cash and cash equivalents	$	0.0	$	1.7		$	0.0		$	31.4	$	0.0		$	33.1
Accounts receivable, net		20.8		128.2			427.4			108.3		(518.6	)		166.1
Inventories, net		0.0		70.5			0.0			81.2		(0.4	)		151.3
Deferred tax assets		0.0		10.0			(1.5	)		0.0		0.0			8.5
Other current assets		0.0		9.2			0.3			11.9		0.0			21.4

Total current assets		20.8		219.6			426.2			232.8		(519.0	)		380.4
Equity investments		69.2		77.1			26.3			3.6		(171.6	)		4.6
Property, plant and equipment, net		0.0		88.1			0.0			66.9		0.0			155.0
Goodwill		0.0		36.9			0.0			32.9		0.0			69.8
Deferred tax assets		0.0		64.1			(47.7	)		4.9		0.0			21.3
Other noncurrent assets		0.0		19.3			0.0			6.6		0.0			25.9

Total assets	$	90.0	$	505.1		$	404.8		$	347.7	$	(690.6	)	$	657.0

LIABILITIES AND EQUITY
Accounts payable	$	0.2	$	489.2		$	9.8		$	105.1	$	(518.6	)	$	85.7
Accrued liabilities		4.1		30.6			(0.1	)		28.1		0.0			62.7
Short-term debt and current portion of long-term debt		0.0		0.2			0.0			0.0		0.0			0.2

Total current liabilities		4.3		520.0			9.7			133.2		(518.6	)		148.6
Long-term debt		0.0		295.2			0.0			0.7		0.0			295.9
Other long-term liabilities		0.0		93.6			0.0			22.2		0.0			115.8

Total liabilities		4.3		908.8			9.7			156.1		(518.6	)		560.3
Koppers stockholders’ equity		85.7		(403.7	)		395.1			180.6		(172.0	)		85.7
Noncontrolling interests		0.0		0.0			0.0			11.0		0.0			11.0

Total liabilities and equity	$	90.0	$	505.1		$	404.8		$	347.7	$	(690.6	)	$	657.0

Condensed Consolidating Balance Sheet

December 31, 2009


	Parent		Koppers Inc.			Domestic Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Adjustments			Consolidated
(Dollars in millions)
ASSETS
Cash and cash equivalents	$	0.2	$	12.9		$	0.0		$	45.3	$	0.0		$	58.4
S-T investments & restricted cash		0.0		0.0			0.0			4.4		0.0			4.4
Accounts receivable, net		36.1		121.3			415.8			83.1		(516.7	)		139.6
Inventories, net		0.0		78.9			0.0			74.0		(0.2	)		152.7
Deferred tax assets		0.0		10.0			(1.5	)		0.0		0.0			8.5
Other current assets		0.0		6.9			0.3			10.3		(0.1	)		17.4

Total current assets		36.3		230.0			414.6			217.1		(517.0	)		381.0
Equity investments		12.7		77.2			14.8			3.3		(103.3	)		4.7
Property, plant and equipment, net		0.0		90.9			0.0			58.4		0.0			149.3
Goodwill		0.0		37.0			0.0			24.6		0.0			61.6
Deferred tax assets		0.0		68.2			(47.7	)		5.4		0.0			25.9
Other noncurrent assets		0.0		19.6			0.0			2.3		0.0			21.9

Total assets	$	49.0	$	522.9		$	381.7		$	311.1	$	(620.3	)	$	644.4

LIABILITIES AND EQUITY
Accounts payable	$	0.6	$	473.9		$	10.2		$	99.3	$	(516.7	)	$	67.3
Accrued liabilities		4.6		29.4			(0.1	)		30.4		0.0			64.3
Short-term debt and current portion of long-term debt		0.0		0.2			0.0			0.0		0.0			0.2

Total current liabilities		5.2		503.5			10.1			129.7		(516.7	)		131.8
Long-term debt		0.0		335.1			0.0			0.0		0.0			335.1
Other long-term liabilities		0.0		96.3			0.0			26.4		0.0			122.7

Total liabilities		5.2		934.9			10.1			156.1		(516.7	)		589.6
Koppers stockholders’ equity		43.8		(412.0	)		371.6			144.0		(103.6	)		43.8
Noncontrolling interests		0.0		0.0			0.0			11.0		0.0			11.0

Total liabilities and equity	$	49.0	$	522.9		$	381.7		$	311.1	$	(620.3	)	$	644.4

Condensed Consolidating Statement of Cash Flows

For the Nine Months Ended September 30, 2010


	Parent			Koppers Inc.			Domestic Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
(Dollars in millions)
Cash provided by (used in) operating activities	$	14.2		$	43.1		$	0.0	$	11.5		$	(4.5	)	$	64.3
Cash provided by (used in) investing activities:
Capital expenditures and acquisitions		0.0			(9.5	)		0.0		(24.1	)		0.0			(33.6	)
Net cash proceeds (payments) from divestitures and asset sales		0.0			0.2			0.0		1.7			0.0			1.9

Net cash provided by (used in) investing activities		0.0			(9.3	)		0.0		(22.4	)		0.0			(31.7	)
Cash provided by (used in) financing activities:
Borrowings (repayments) of long-term debt		0.0			(40.1	)		0.0		0.0			0.0			(40.1	)
Deferred financing costs		0.0			(0.4	)		0.0		0.0			0.0			(0.4	)
Dividends paid		(13.5	)		(4.5	)		0.0		(5.0	)		4.5			(18.5	)
Stock issued (repurchased)		(0.9	)		0.0			0.0		0.0			0.0			(0.9	)

Net cash provided by (used in) financing activities		(14.4	)		(45.0	)		0.0		(5.0	)		4.5			(59.9	)
Effect of exchange rates on cash		0.0			0.0			0.0		2.0			0.0			2.0

Net increase (decrease) in cash and cash equivalents		(0.2	)		(11.2	)		0.0		(13.9	)		0.0			(25.3	)
Cash and cash equivalents at beginning of year		0.2			12.9			0.0		45.3			0.0			58.4

Cash and cash equivalents at end of period	$	0.0		$	1.7		$	0.0	$	31.4		$	0.0		$	33.1

Condensed Consolidating Statement of Cash Flows

For the Nine Months Ended September 30, 2009


	Parent			Koppers Inc.			Domestic Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
(Dollars in millions)
Cash provided by (used in) operating activities	$	13.7		$	75.9		$	0.0	$	16.7		$	(13.7	)	$	92.6
Cash provided by (used in) investing activities:
Capital expenditures and acquisitions		0.0			(8.2	)		0.0		(3.0	)		0.0			(11.2	)
Net cash proceeds (payments) from divestitures and asset sales		0.0			(1.1	)		0.0		0.0			0.0			(1.1	)

Net cash (used in) investing activities		0.0			(9.3	)		0.0		(1.5	)		0.0			(12.3	)
Cash provided by (used in) financing activities:
Borrowings (repayments) of long-term debt		0.0			(0.1	)		0.0		0.0			0.0			(0.1	)
Dividends paid		(13.5	)		(13.7	)		0.0		0.0			13.7			(13.5	)

Net cash provided by (used in) financing activities		(13.5	)		(13.8	)		0.0		0.0			13.7			(13.6	)
Effect of exchange rates on cash		0.0			(1.5	)		0.0		2.6			0.0			1.1

Net increase (decrease) in cash and cash equivalents		0.2			51.3			0.0		16.3			0.0			67.8
Cash and cash equivalents at beginning of year		0.0			37.5			0.0		25.6			0.0			63.1

Cash and cash equivalents at end of period	$	0.2		$	88.8		$	0.0	$	41.9		$	0.0		$	130.9

Subsidiary Guarantor Information for Shelf Registration

9 Months Ended

Sep. 30, 2010

Statement [Line Items]

Subsidiary Guarantor Information for Shelf Registration

18. Subsidiary Guarantor Information for Shelf Registration

Under a registration statement on Form S-3, Koppers Holdings may sell a combination of securities including common stock, debt securities, preferred stock, depository shares and warrants, from time to time in one or more offerings with an aggregate offering price of up to $325 million. In addition, Koppers Inc. may sell debt securities from time to time under the registration statement. Debt securities may be fully and unconditionally guaranteed, on a joint and several basis, by Koppers Holdings, Koppers Inc. and/or other guarantor subsidiaries which will correspond to subsidiaries in the United States, Europe and Australia. The non-guarantor subsidiaries consist of certain subsidiaries in the United States, China and Mauritius. The guarantor subsidiaries that issue guarantees, if any, will be determined when a debt offering actually occurs under the registration statement and accordingly, the condensed consolidated financial information for subsidiary guarantors will be revised to identify the subsidiaries that actually provided guarantees.

Separate condensed consolidating financial statement information for the parent, Koppers Inc., domestic guarantor subsidiaries, foreign guarantor subsidiaries and non-guarantor subsidiaries as of September 30, 2010 and 2009 and for the three and nine months ended September 30, 2010 and 2009 is as follows:

Condensed Consolidating Statement of Operations

For the Three Months Ended September 30, 2010


	Parent			Koppers Inc.		Domestic Guarantor Subsidiaries			Foreign Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Adjustments			Consolidated
(Dollars in millions)
Net sales	$	0.0		$	196.1	$	10.2		$	95.8	$	40.5	$	(6.3	)	$	336.3
Cost of sales including depreciation and amortization		0.0			171.4		(1.1	)		81.8		35.5		(0.2	)		287.4
Selling, general and administrative		0.3			8.1		0.3			4.8		1.9		0.0			15.4

Operating profit (loss)		(0.3	)		16.6		11.0			9.2		3.1		(6.1	)		33.5
Other income (expense)		15.8			0.0		(0.1	)		0.0		0.1		(15.8	)		0.0
Interest expense (income)		(0.1	)		7.0		0.0			1.9		0.1		(2.3	)		6.6
Income taxes		0.0			8.0		0.1			2.9		0.1		0.0			11.1

Income from continuing operations		15.6			1.6		10.8			4.4		3.0		(19.6	)		15.8
Discontinued operations		0.0			0.0		0.0			0.0		0.0		0.0			0.0
Noncontrolling interests		0.0			0.0		0.0			0.0		0.2		0.0			0.2

Net income attributable to Koppers	$	15.6		$	1.6	$	10.8		$	4.4	$	2.8	$	(19.6	)	$	15.6

Condensed Consolidating Statement of Operations

For the Three Months Ended September 30, 2009


	Parent			Koppers Inc.		Domestic Guarantor Subsidiaries			Foreign Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
(Dollars in millions)
Net sales	$	0.0		$	179.0	$	5.6		$	98.3	$	19.7		$	(12.8	)	$	289.8
Cost of sales including depreciation and amortization		0.0			156.0		(7.9	)		81.7		16.5			(2.7	)		243.6
Selling, general and administrative		0.6			5.7		0.4			5.3		1.0			0.0			13.0

Operating profit (loss)		(0.6	)		17.3		13.1			11.3		2.2			(10.1	)		33.2
Other income (expense)		20.1			0.0		0.0			0.2		(0.5	)		(20.1	)		(0.3	)
Interest expense (income)		5.1			5.4		0.0			1.0		(0.1	)		(1.4	)		10.0
Income taxes		(2.0	)		4.2		0.1			3.0		0.5			0.0			5.8

Income from continuing operations		16.4			7.7		13.0			7.5		1.3			(28.8	)		17.1
Discontinued operations		0.0			0.0		0.0			0.0		0.0			0.0			0.0
Noncontrolling interests		0.0			0.0		0.0			0.0		0.7			0.0			0.7

Net income attributable to Koppers	$	16.4		$	7.7	$	13.0		$	7.5	$	0.6		$	(28.8	)	$	16.4

Condensed Consolidating Statement of Operations

For the Nine Months Ended September 30, 2010


	Parent			Koppers Inc.			Domestic Guarantor Subsidiaries			Foreign Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Adjustments			Consolidated
(Dollars in millions)
Net sales	$	0.0		$	549.8		$	35.3		$	273.4	$	112.2	$	(33.0	)	$	937.7
Cost of sales including depreciation and amortization		0.0			490.8			13.0			221.8		100.8		(19.6	)		806.8
Selling, general and administrative		1.4			24.0			2.8			15.0		4.6		0.0			47.8

Operating profit (loss)		(1.4	)		35.0			19.5			36.6		6.8		(13.4	)		83.1
Other income (expense)		39.9			0.1			(0.3	)		1.7		0.3		(39.9	)		1.8
Interest expense (income)		(0.1	)		21.0			0.0			3.8		0.5		(4.8	)		20.4
Income taxes		(0.4	)		15.6			0.3			9.4		0.1		0.0			25.0

Income (loss) from continuing operations		39.0			(1.5	)		18.9			25.1		6.5		(48.5	)		39.5
Discontinued operations		0.0			0.0			(0.2	)		0.0		0.0		0.0			(0.2	)
Noncontrolling interests		0.0			0.0			0.0			0.0		0.3		0.0			0.3

Net income (loss) attributable to Koppers	$	39.0		$	(1.5	)	$	18.7		$	25.1	$	6.2	$	(48.5	)	$	39.0

Condensed Consolidating Statement of Operations

For the Nine Months Ended September 30, 2009


	Parent			Koppers Inc.			Domestic Guarantor Subsidiaries			Foreign Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
(Dollars in millions)
Net sales	$	0.0		$	564.1		$	22.6		$	251.8	$	58.9		$	(43.3	)	$	854.1
Cost of sales including depreciation and amortization		0.0			495.0			(3.1	)		213.7		50.0			(27.3	)		728.3
Selling, general and administrative		1.7			20.5			1.2			14.7		2.8			0.0			40.9

Operating profit (loss)		(1.7	)		48.6			24.5			23.4		6.1			(16.0	)		84.9
Other income (expense)		42.8			0.2			(0.2	)		0.2		(0.7	)		(42.8	)		(0.5	)
Interest expense (income)		14.5			16.7			0.0			2.8		(0.1	)		(3.7	)		30.2
Income taxes		(5.6	)		17.4			0.2			6.1		1.6			0.0			19.7

Income from continuing operations		32.2			14.7			24.1			14.7		3.9			(55.1	)		34.5
Discontinued operations		0.0			(0.3	)		0.0			0.0		0.0			0.0			(0.3	)
Noncontrolling interests		0.0			0.0			0.0			0.0		2.0			0.0			2.0

Net income attributable to Koppers	$	32.2		$	14.4		$	24.1		$	14.7	$	1.9		$	(55.1	)	$	32.2

Condensed Consolidating Balance Sheet

September 30, 2010


	Parent		Koppers Inc.			Domestic Guarantor Subsidiaries			Foreign Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Adjustments			Consolidated
(Dollars in millions)
ASSETS
Cash and cash equivalents	$	0.0	$	1.7		$	0.0		$	18.8	$	12.6	$	0.0		$	33.1
Accounts receivable, net		20.8		128.2			424.7			80.7		67.5		(555.8	)		166.1
Inventories, net		0.0		70.5			0.0			69.1		12.1		(0.4	)		151.3
Deferred tax assets		0.0		10.0			(1.5	)		0.0		0.0		0.0			8.5
Other current assets		0.0		9.2			0.2			5.8		6.2		0.0			21.4

Total current assets		20.8		219.6			423.4			174.4		98.4		(556.2	)		380.4
Equity investments		69.2		77.1			26.3			18.5		13.7		(200.2	)		4.6
Property, plant and equipment, net		0.0		88.1			0.0			43.2		23.7		0.0			155.0
Goodwill		0.0		36.9			0.0			24.6		8.3		0.0			69.8
Deferred tax assets		0.0		64.1			(47.7	)		4.9		0.0		0.0			21.3
Other noncurrent assets		0.0		19.3			0.0			1.0		5.6		0.0			25.9

Total assets	$	90.0	$	505.1		$	402.0		$	266.6	$	149.7	$	(756.4	)	$	657.0

LIABILITIES AND EQUITY
Accounts payable	$	0.2	$	489.2		$	7.2		$	99.2	$	45.7	$	(555.8	)	$	85.7
Accrued liabilities		4.1		30.6			(0.1	)		20.7		7.4		0.0			62.7
Short-term debt and current portion of long-term debt		0.0		0.2			0.0			0.0		0.0		0.0			0.2

Total current liabilities		4.3		520.0			7.1			119.9		53.1		(555.8	)		148.6
Long-term debt		0.0		295.2			0.0			0.0		0.7		0.0			295.9
Other long-term liabilities		0.0		93.6			0.0			13.4		8.8		0.0			115.8

Total liabilities		4.3		908.8			7.1			133.3		62.6		(555.8	)		560.3
Koppers stockholders’ equity		85.7		(403.7	)		394.9			133.3		76.1		(200.6	)		85.7
Noncontrolling interests		0.0		0.0			0.0			0.0		11.0		0.0			11.0

Total liabilities and equity	$	90.0	$	505.1		$	402.0		$	266.6	$	149.7	$	(756.4	)	$	657.0

Condensed Consolidating Balance Sheet

December 31, 2009


	Parent		Koppers Inc.			Domestic Guarantor Subsidiaries			Foreign Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Adjustments			Consolidated
(Dollars in millions)
ASSETS
Cash and cash equivalents	$	0.2	$	12.9		$	0.0		$	36.9	$	8.4	$	0.0		$	58.4
S-T investments & restricted cash		0.0		0.0			0.0			0.0		4.4		0.0			4.4
Accounts receivable, net		36.1		121.3			415.8			42.2		41.1		(516.9	)		139.6
Inventories, net		0.0		78.9			0.0			67.0		7.0		(0.2	)		152.7
Deferred tax assets		0.0		10.0			(1.5	)		0.0		0.0		0.0			8.5
Other current assets		0.0		6.9			0.3			6.8		3.5		(0.1	)		17.4

Total current assets		36.3		230.0			414.6			152.9		64.4		(517.2	)		381.0
Equity investments		12.7		77.2			14.8			17.1		3.4		(120.5	)		4.7
Property, plant and equipment, net		0.0		90.9			0.0			41.8		16.6		0.0			149.3
Goodwill		0.0		37.0			0.0			23.3		1.3		0.0			61.6
Deferred tax assets		0.0		68.2			(47.7	)		5.4		0.0		0.0			25.9
Other noncurrent assets		0.0		19.6			0.0			0.8		1.4		0.1			21.9

Total assets	$	49.0	$	522.9		$	381.7		$	241.3	$	87.1	$	(637.6	)	$	644.4

LIABILITIES AND EQUITY
Accounts payable	$	0.6	$	473.9		$	10.2		$	91.5	$	8.0	$	(516.9	)	$	67.3
Accrued liabilities		4.6		29.4			(0.1	)		20.5		9.9		0.0			64.3
Short-term debt and current portion of long-term debt		0.0		0.2			0.0			0.0		0.0		0.0			0.2

Total current liabilities		5.2		503.5			10.1			112.0		17.9		(516.9	)		131.8
Long-term debt		0.0		335.1			0.0			0.0		0.0		0.0			335.1
Other long-term liabilities		0.0		96.3			0.0			16.0		10.4		0.0			122.7

Total liabilities		5.2		934.9			10.1			128.0		28.3		(516.9	)		589.6
Koppers stockholders’ equity		43.8		(412.0	)		371.6			113.3		47.8		(120.7	)		43.8
Noncontrolling interests		0.0		0.0			0.0			0.0		11.0		0.0			11.0

Total liabilities and equity	$	49.0	$	522.9		$	381.7		$	241.3	$	87.1	$	(637.6	)	$	644.4

Condensed Consolidating Statement of Cash Flows

For the Nine Months Ended September 30, 2010


	Parent			Koppers Inc.			Domestic Guarantor Subsidiaries		Foreign Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
(Dollars in millions)
Cash provided by (used in) operating activities	$	14.2		$	43.1		$	0.0	$	(15.9	)	$	27.4		$	(4.5	)	$	64.3
Cash provided by (used in) investing activities:
Capital expenditures and acquisitions		0.0			(9.5	)		0.0		(3.5	)		(20.6	)		0.0			(33.6	)
Net cash proceeds (payments) from divestitures and asset sales		0.0			0.2			0.0		1.6			0.1			0.0			1.9

Net cash provided by (used in) investing activities		0.0			(9.3	)		0.0		(1.9	)		(20.5	)		0.0			(31.7	)
Cash provided by (used in) financing activities:
Borrowings (repayments) of long-term debt		0.0			(40.1	)		0.0		0.0			0.0			0.0			(40.1	)
Deferred financing costs		0.0			(0.4	)		0.0		0.0			0.0			0.0			(0.4	)
Dividends paid		(13.5	)		(4.5	)		0.0		0.0			(5.0	)		4.5			(18.5	)
Stock issued (repurchased)		(0.9	)		0.0			0.0		0.0			0.0			0.0			(0.9	)

Net cash provided by (used in) financing activities		(14.4	)		(45.0	)		0.0		0.0			(5.0	)		4.5			(59.9	)
Effect of exchange rates on cash		0.0			0.0			0.0		(0.3	)		2.3			0.0			2.0

Net increase (decrease) in cash and cash equivalents		(0.2	)		(11.2	)		0.0		(18.1	)		4.2			0.0			(25.3	)
Cash and cash equivalents at beginning of year		0.2			12.9			0.0		36.9			8.4			0.0			58.4

Cash and cash equivalents at end of period	$	0.0		$	1.7		$	0.0	$	18.8		$	12.6		$	0.0		$	33.1

Condensed Consolidating Statement of Cash Flows

For the Nine Months Ended September 30, 2009


	Parent			Koppers Inc.			Domestic Guarantor Subsidiaries		Foreign Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Consolidated
(Dollars in millions)
Cash provided by (used in) operating activities	$	13.7		$	75.9		$	0.0	$	14.4		$	2.3		$	(13.7	)	$	92.6
Cash provided by (used in) investing activities:
Capital expenditures and acquisitions		0.0			(8.2	)		0.0		(1.5	)		(1.5	)		0.0			(11.2	)
Net cash proceeds (payments) from divestitures and asset sales		0.0			(1.1	)		0.0		0.0			0.0			0.0			(1.1	)

Net cash (used in) investing activities		0.0			(9.3	)		0.0		(1.5	)		(1.5	)		0.0			(12.3	)
Cash provided by (used in) financing activities:
Borrowings (repayments) of long-term debt		0.0			(0.1	)		0.0		0.0			0.0			0.0			(0.1	)
Dividends paid		(13.5	)		(13.7	)		0.0		0.0			0.0			13.7			(13.5	)

Net cash provided by (used in) financing activities		(13.5	)		(13.8	)		0.0		0.0			0.0			13.7			(13.6	)
Effect of exchange rates on cash		0.0			(1.5	)		0.0		2.6			0.0			0.0			1.1

Net increase (decrease) in cash and cash equivalents		0.2			51.3			0.0		15.5			0.8			0.0			67.8
Cash and cash equivalents at beginning of year		0.0			37.5			0.0		18.7			6.9			0.0			63.1

Cash and cash equivalents at end of period	$	0.2		$	88.8		$	0.0	$	34.2		$	7.7		$	0.0		$	130.9