Document and Entity Information

3 Months Ended

Mar. 31, 2016

Apr. 29, 2016

Entity Information [Line Items]

Entity Registrant Name

LIBBEY INC

Entity Central Index Key

0000902274

Current Fiscal Year End Date

--12-31

Entity Filer Category

Large Accelerated Filer

Document Type

10-Q

Document Period End Date

Mar. 31, 2016

Document Fiscal Year Focus

2016

Document Fiscal Period Focus

Q1

Amendment Flag

false

Entity Common Stock, Shares Outstanding

21,760,562

Condensed Consolidated Statements of Operations (USD $)

In Thousands, except Per Share data, unless otherwise specified

3 Months Ended

Mar. 31, 2016

Mar. 31, 2015

Net sales

$ 182,807

$ 187,365

Freight billed to customers

618

606

Total revenues

183,425

187,971

Cost of sales

143,451

145,476

Gross profit

39,974

42,495

Selling, general and administrative expenses

34,135

34,399

Income from operations

5,839

8,096

Other income (expense)

(15)

827

Earnings before interest and income taxes

5,824

8,923

Interest expense

5,244

4,523

Income before income taxes

580

4,400

Provision (benefit) for income taxes

(138)

1,288

Net income

$ 718

$ 3,112

Net income per share:

Basic

$ 0.03

$ 0.14

Diluted

$ 0.03

$ 0.14

Dividends declared per share

$ 0.115

$ 0.11

Condensed Consolidated Statements of Comprehensive Income (Loss) (USD $)

In Thousands, unless otherwise specified

3 Months Ended

Mar. 31, 2016

Mar. 31, 2015

Net income

$ 718

$ 3,112

Other comprehensive income (loss):

Pension and other postretirement benefit adjustments, net of tax

989

4,712

Change in fair value of derivative instruments, net of tax

(1,858)

(242)

Foreign currency translation adjustments, net of tax

3,205

(10,490)

Other comprehensive income (loss), net of tax

2,336

(6,020)

Comprehensive income (loss)

$ 3,054

$ (2,908)

Condensed Consolidated Balance Sheets (USD $)

In Thousands, unless otherwise specified

Mar. 31, 2016

Dec. 31, 2015

Assets:

Cash and cash equivalents

$ 25,570

$ 49,044

Accounts receivable - net

87,901

94,379

Inventories - net

191,950

178,027

Prepaid and other current assets

19,845

19,326

Total current assets

325,266

340,776

Pension asset

977

Purchased intangible assets - net

16,231

16,364

Goodwill

164,112

Deferred income taxes

49,736

48,662

Other assets

8,900

9,019

Total other assets

239,956

239,134

Property, plant and equipment - net

268,913

272,534

Total assets

834,135

852,444

Liabilities and Shareholders' Equity:

Accounts payable

63,185

71,560

Salaries and wages

25,971

27,266

Accrued liabilities

42,545

45,179

Accrued income taxes

2,295

4,009

Pension liability (current portion)

2,032

2,297

Non-pension postretirement benefits (current portion)

4,903

Derivative liability

4,346

4,265

Long-term debt due within one year

4,761

4,747

Total current liabilities

150,038

164,226

Long-term debt

420,469

426,272

Pension liability

42,792

44,274

Non-pension postretirement benefits

55,446

55,282

Deferred income taxes

3,235

2,822

Other long-term liabilities

13,736

11,186

Total liabilities

685,716

704,062

Shareholders' equity:

Common stock, par value $.01 per share, 50,000,000 shares authorized, 21,843,851 shares issued in 2016 (21,843,851 shares issued in 2015)

218

Capital in excess of par value

328,473

330,756

Treasury stock

(979)

(4,448)

Retained deficit

(61,397)

(57,912)

Accumulated other comprehensive loss

(117,896)

(120,232)

Total shareholders' equity

148,419

148,382

Total liabilities and shareholders' equity

$ 834,135

$ 852,444

Condensed Consolidated Balance Sheets Parenthetical (USD $)

Mar. 31, 2016

Dec. 31, 2015

Common stock, par value

$ 0.01

Common stock, shares authorized

50,000,000

Common stock, shares issued

21,843,851

Condensed Consolidated Statement of Shareholders' Equity Statement (USD $)

In Thousands, except Share data, unless otherwise specified

Total

Common Stock

Treasury Stock

Capital in Excess of Par Value

Retained Deficit

Accumulated Other Comprehensive Loss (note 9)

Balance, value at Dec. 31, 2015

$ 148,382

$ 218

$ (4,448)

$ 330,756

$ (57,912)

$ (120,232)

Balance, shares at Dec. 31, 2015

21,843,851

110,717

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Net income

718

Other comprehensive income

2,336

Stock compensation expense

281

Dividends

(2,515)

Stock withheld for employee taxes

(473)

Stock issued, value

887

4,666

(2,091)

Stock issued, value lower than repurchase price

(1,688)

Stock issued, shares

(122,785)

Purchase of treasury shares, value

(1,197)

Purchase of treasury shares, shares

66,115

Balance, value at Mar. 31, 2016

$ 148,419

$ 218

$ (979)

$ 328,473

$ (61,397)

$ (117,896)

Balance, shares at Mar. 31, 2016

21,843,851

54,047

Condensed Consolidated Statements of Cash Flows (USD $)

In Thousands, unless otherwise specified

3 Months Ended

Mar. 31, 2016

Mar. 31, 2015

Operating activities:

Net income

$ 718

$ 3,112

Adjustments to reconcile net income to net cash used in operating activities:

Depreciation and amortization

12,081

10,184

Loss on asset sales and disposals

61

211

Change in accounts receivable

7,217

(5,647)

Change in inventories

(12,467)

(16,720)

Change in accounts payable

(5,589)

(2,339)

Accrued interest and amortization of discounts and finance fees

(2,220)

212

Pension & non-pension postretirement benefits, net

(101)

1,003

Accrued liabilities & prepaid expenses

(1,616)

(2,876)

Income taxes

(2,965)

(1,360)

Share-based compensation expense

1,816

2,129

Other operating activities

(1,909)

(1,145)

Net cash used in operating activities

(4,974)

(13,236)

Investing activities:

Additions to property, plant and equipment

(9,855)

(16,659)

Net cash used in investing activities

(9,855)

(16,659)

Financing activities:

Borrowing on ABL credit facility

6,000

14,100

Repayments on ABL credit facility

(6,000)

(10,000)

Other repayments

(171)

(3,255)

Repayments on Term Loan B

(6,100)

(1,100)

Stock options exercised

1,029

1,848

Dividends

(2,515)

(2,402)

Treasury shares purchased

(1,197)

(9,144)

Net cash used in financing activities

(8,954)

(9,953)

Effect of exchange rate fluctuations on cash

309

(1,580)

Decrease in cash

(23,474)

(41,428)

Cash at beginning of period

49,044

60,044

Cash at end of period

25,570

18,616

Supplemental disclosure of cash flow information:

Cash paid during the period for interest, net of capitalized interest

7,318

3,929

Cash paid during the period for income taxes

$ 1,544

$ 1,181

Description of the Business

Libbey is a leading global manufacturer and marketer of glass tableware products. We produce glass tableware in five countries and sell to customers in over 100 countries. We design and market, under our Libbey^®, Crisa^®, Royal Leerdam^®, World^® Tableware, Syracuse^® China and Crisal Glass^® brand names (among others), an extensive line of high-quality glass tableware, ceramic dinnerware, metal flatware, hollowware and serveware items for sale primarily in the foodservice, retail and business-to-business markets. Our sales force presents our products to the global marketplace in a coordinated fashion. We own and operate two glass tableware manufacturing plants in the United States as well as glass tableware manufacturing plants in the Netherlands (Libbey Holland), Portugal (Libbey Portugal), China (Libbey China) and Mexico (Libbey Mexico). In addition, we import products from overseas in order to complement our line of manufactured items. The combination of manufacturing and procurement allows us to compete in the global tableware market by offering an extensive product line at competitive prices.

Our website can be found at www.libbey.com. We make available, free of charge, at this website all of our reports filed or furnished pursuant to Section 13(a) or 15(d) of Securities Exchange Act of 1934, including our annual report on Form 10-K, our quarterly reports on Form 10-Q, our current reports on Form 8-K, as well as amendments to those reports. These reports are made available on our website as soon as reasonably practicable after their filing with, or furnishing to, the Securities and Exchange Commission and can also be found at www.sec.gov.

Our shares are traded on the NYSE MKT exchange under the ticker symbol LBY.

Significant Accounting Policies

See our Form 10-K for the year ended December 31, 2015 for a description of significant accounting policies not listed below.

Basis of Presentation

The Condensed Consolidated Financial Statements include Libbey Inc. and its majority-owned subsidiaries (collectively, Libbey or the Company). Our fiscal year end is December 31^st. All material intercompany accounts and transactions have been eliminated. The preparation of financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the Condensed Consolidated Financial Statements and accompanying notes. Actual results could differ materially from management’s estimates.

Condensed Consolidated Statements of Operations

Net sales in our Condensed Consolidated Statements of Operations include revenue earned when products are shipped and title and risk of loss have passed to the customer. Revenue is recorded net of returns, discounts and incentives offered to customers. Cost of sales includes cost to manufacture and/or purchase products, warehouse, shipping and delivery costs and other costs.

Foreign Currency Translation

Assets and liabilities of non-U.S. subsidiaries that operate in a local currency environment, where that local currency is the functional currency, are translated to U.S. dollars at exchange rates in effect at the balance sheet date, with the resulting translation adjustments directly recorded to a separate component of accumulated other comprehensive loss. Income and expense accounts are translated at average exchange rates during the year. The effect of exchange rate changes on transactions denominated in currencies other than the functional currency is recorded in other income (expense).

Income Taxes

Income taxes are accounted for under the asset and liability method. Deferred income tax assets and liabilities are recognized for estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax attribute carry-forwards. Deferred income tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. Financial Accounting Standards Board Accounting Standards Codification™ (FASB ASC) Topic 740, “Income Taxes,” requires that a valuation allowance be recorded when it is more likely than not that some portion or all of the deferred income tax assets will not be realized. Deferred income tax assets and liabilities are determined separately for each tax paying component in which we conduct our operations or otherwise incur taxable income or losses. See note 5 for further discussion.

Stock-Based Compensation Expense

We account for stock-based compensation expense in accordance with FASB ASC Topic 718, “Compensation — Stock Compensation,” and FASB ASC Topic 505-50, “Equity — Equity-Based Payments to Non-Employees”. Stock-based compensation cost is measured based on the fair value of the equity instruments issued. FASB ASC Topics 718 and 505-50 apply to all of our outstanding unvested stock-based payment awards. Stock-based compensation expense charged to the Condensed Consolidated Statements of Operations is as follows:



	Three months ended March 31,
(dollars in thousands)	2016		2015
Stock-based compensation expense	$	1,816	$	2,129

Reclassifications

Certain amounts in prior years' financial statements have been reclassified to conform to the presentation used in the quarter ended March 31, 2016, including the segment data in note 10.

New Accounting Standards

In May 2014, the FASB issued Accounting Standards Update No. 2014-09, "Revenue From Contracts With Customers" (ASU 2014-09), which outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. ASU 2014-09 is based on the principle that an entity should recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2014-09 also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to fulfill a contract. Entities have the option of using either a full retrospective or a modified retrospective approach for the adoption of the new standard. This update is effective for interim and annual reporting periods beginning after December 15, 2016; early adoption is not permitted. In August 2015, the FASB issued ASU 2015-14 which defers the effective date one year from January 1, 2017 to January 1, 2018, but early adoption as of January 1, 2017 is permitted. In March of 2016 the FASB issued ASU 2016-08, "Revenue From Contracts With Customers: Principal vs. Agent Considerations" (ASU 2016-08). ASU 2016-08 provides more detailed guidance in determining principal or agent determination and when revenue should be recorded when a performance obligation is completed. We are currently assessing the impact that these standards will have on our Condensed Consolidated Financial Statements.

In August 2014, the FASB issued Accounting Standards Update No. 2014-15, "Presentation of Financial Statements-Going Concern" (ASU 2014-15), which establishes management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern in connection with preparing financial statements for each annual and interim reporting period. ASU 2014-15 also provides guidance to determine whether to disclose information about relevant conditions and events when there is substantial doubt about an entity’s ability to continue as a going concern. This update is effective for the annual reporting period ending after December 15, 2016, and for interim and annual periods thereafter. Early application is permitted. We are currently evaluating the impact that this standard will have on our Condensed Consolidated Financial Statements.

In May 2015, the FASB issued Accounting Standards Update 2015-07, "Disclosures for Investments in Certain Entities that Calculate Net Asset Value Per Share (or its Equivalent)" (ASU 2015-07), which removes the requirement to categorize within the fair value hierarchy investments for which fair values are estimated using the net asset value practical expedient provided by FASB ASC Topic 820, Fair Value Measurement. Disclosures about investments in certain entities that calculate net asset value per share are limited under ASU 2015-07 to those investments for which the entity has elected to estimate the fair value using the net asset value practical expedient. ASU 2015-07 is effective for entities for fiscal years beginning after December 15, 2015 and interim periods within, with retrospective application to all periods presented. Early application is permitted. Although there is no impact on our 2016 interim financial statements, we are currently assessing the impact that this standard will have on our Consolidated Financial Statements at December 31, 2016.

In July 2015, the FASB issued Accounting Standards Update No. 2015-11, "Inventory (Topic 330): Simplifying the Measurement of Inventory" (ASU 2015-11), which requires that inventory be measured at the lower of its cost or the estimated sale price, minus the costs of completing the sale, which the FASB calls the net realizable value. This update is effective for interim and annual reporting periods beginning after December 15, 2016, with early adoption permitted. We are currently evaluating the impact that this standard will have on our Condensed Consolidated Financial Statements.

In February 2016, the FASB issued Accounting Standards Update No. 2016-02, "Leases (Topic 842)" (ASU 2016-02), which requires a lessee to recognize assets and liabilities for leases with lease terms of more than 12 months on the balance sheet. Leases will be classified as either finance or operating leases, with classification affecting the pattern of expense recognition in the income statement. The new guidance also clarifies the definition of a lease and disclosure requirements. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, with early application permitted. We are currently assessing the impact that this standard will have on our Condensed Consolidated Financial Statements.

In March 2016, the FASB issued Accounting Standards Update No. 2016-09, "Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting" (ASU 2016-09). Areas for simplification in this update involve several aspects of accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. ASU 2016-09 is effective for interim and annual reporting periods beginning after December 15, 2016, with early application permitted. We are currently assessing the impact that this standard will have on our Condensed Consolidated Financial Statements.

Balance Sheet Details

The following table provides detail of selected balance sheet items:



(dollars in thousands)	March 31, 2016		December 31, 2015
Accounts receivable:
Trade receivables	$	84,203	$	91,324
Other receivables	3,698		3,055
Total accounts receivable, less allowances of $6,063 and $7,066	$	87,901	$	94,379

Inventories:
Finished goods	$	173,597	$	159,998
Work in process	1,619		1,183
Raw materials	4,497		4,944
Repair parts	11,057		10,763
Operating supplies	1,180		1,139
Total inventories, less loss provisions of $5,533 and $5,313	$	191,950	$	178,027

Accrued liabilities:
Accrued incentives	$	20,865	$	21,450
Other accrued liabilities	21,680		23,729
Total accrued liabilities	$	42,545	$	45,179

Borrowings

Borrowings consist of the following:



(dollars in thousands)	Interest Rate		Maturity Date	March 31, 2016		December 31, 2015
Borrowings under ABL Facility	floating		April 9, 2019	$	—	$	—
Term Loan B	floating	⁽¹⁾	April 9, 2021	427,300		433,400
AICEP Loan	0.00%		July, 2016 to July 30, 2018	3,413		3,451
Total borrowings				430,713		436,851
Less — unamortized discount and finance fees				5,483		5,832
Total borrowings — net				425,230		431,019
Less — long term debt due within one year				4,761		4,747
Total long-term portion of borrowings — net				$	420,469	$	426,272

________________________

(1) - See interest rate swap in note 8. The interest rate was 3.75 percent at March 31, 2016.

At March 31, 2016, the available borrowing base under the ABL Facility is offset by a $0.4 million rent reserve and a $1.6 million mark-to-market reserve for natural gas contracts. The ABL Facility also provides for the issuance of up to $30.0 million of letters of credit, which when outstanding are applied against the $100.0 million limit; at March 31, 2016, $6.6 million in letters of credit were outstanding. Remaining unused availability under the ABL Facility was $91.4 million at March 31, 2016, compared to $91.0 million at December 31, 2015.

Income Taxes

For interim tax reporting, we estimate our annual effective tax rate and apply it to our year-to-date ordinary income. Tax jurisdictions with a projected or year-to-date loss for which a tax benefit cannot be realized are excluded from the annualized effective tax rate. The tax effects of unusual or infrequently occurring items, including changes in judgment about valuation allowances and effects of changes in tax laws or rates, are reported in the interim period in which they occur.

Our effective tax rate was (23.8) percent for the quarter ended March 31, 2016, compared to 29.3 percent for the quarter ended March 31, 2015. Our effective tax rate differs from the United States statutory tax rate primarily due to a valuation allowance on deferred tax assets in the Netherlands, earnings in countries with differing statutory tax rates, foreign withholding tax, and tax planning structures.

At March 31, 2016, we continued to record a valuation allowance of approximately $11.9 million against our deferred tax assets in the Netherlands. We review the need for valuation allowances in all jurisdictions on a quarterly basis in order to assess the likelihood of the realization of our deferred tax assets. In assessing the need for recording or reversing a valuation allowance, we weigh all available positive and negative evidence. Examples of the evidence we consider are cumulative losses in recent years, losses expected in early future years, a history of potential tax benefits expiring unused, prudent and feasible tax planning strategies that could be implemented, and whether there were unusual, infrequent or extraordinary items to be considered. With respect to the valuation allowance recorded in the Netherlands, management continues to conclude that the negative evidence outweighs the positive and thus the valuation allowance was maintained.

Pension and Non-pension Postretirement Benefits

ension and Non-pension Postretirement Benefits

We have pension plans covering the majority of our employees. Benefits generally are based on compensation and service for salaried employees and job grade and length of service for hourly employees. In addition, we have an unfunded supplemental employee retirement plan (SERP) that covers certain salaried U.S.-based employees of Libbey hired before January 1, 2006. The U.S. pension plans cover the salaried U.S.-based employees of Libbey hired before January 1, 2006 and most hourly U.S.-based employees (excluding employees hired at Shreveport after 2008 and at Toledo after September 30, 2010). Effective January 1, 2013, we ceased annual company contribution credits to the cash balance accounts in our Libbey U.S. Salaried Pension Plan and SERP. The non-U.S. pension plans cover the employees of our wholly owned subsidiary in Mexico. The plan in Mexico is unfunded.

In the fourth quarter of 2015, we executed an agreement with Pensioenfonds voor de Grafische Bedrijven (“PGB”), an industry wide pension fund, and unwound direct ownership of our defined benefit pension plan in the Netherlands. In accordance with this agreement, we transferred all assets of the plan to PGB, which now assumes the related liabilities and administrative responsibilities of the plan. In 2016, Libbey Holland continues to make cash contributions to PGB as participating employees earn pension benefits. These related costs are expensed as incurred and are excluded from 2016 pension expense below.

The components of our net pension expense, including the SERP, are as follows:



Three months ended March 31,	U.S. Plans						Non-U.S. Plans						Total
(dollars in thousands)	2016			2015			2016			2015			2016			2015
Service cost	$	996		$	1,161		$	317		$	748		$	1,313		$	1,909
Interest cost	3,777			3,709			672			1,103			4,449			4,812
Expected return on plan assets	(5,755		)	(5,662		)	—			(598		)	(5,755		)	(6,260		)
Amortization of unrecognized:
Prior service cost	66			104			(54		)	(64		)	12			40
Actuarial loss	1,120			1,886			202			406			1,322			2,292
Pension expense	$	204		$	1,198		$	1,137		$	1,595		$	1,341		$	2,793

We have contributed $1.5 million of cash into our pension plans for the three months ended March 31, 2016. Pension contributions for the remainder of 2016 are estimated to be $1.0 million.

We provide certain retiree health care and life insurance benefits covering our U.S. and Canadian salaried employees hired before January 1, 2004 and a majority of our union hourly employees (excluding employees hired at Shreveport after 2008 and at Toledo after September 30, 2010). Employees are generally eligible for benefits upon retirement and completion of a specified number of years of creditable service. Benefits for most hourly retirees are determined by collective bargaining. The U.S. non-pension postretirement plans cover the hourly and salaried U.S.-based employees of Libbey (excluding those mentioned above). The non-U.S. non-pension postretirement plans cover the retirees and active employees of Libbey who are located in Canada. The postretirement benefit plans are unfunded.

The provision for our non-pension postretirement benefit expense consists of the following:



Three months ended March 31,	U.S. Plans				Non-U.S. Plans					Total
(dollars in thousands)	2016		2015		2016			2015		2016		2015
Service cost	$	199	$	282	$	—		$	—	$	199	$	282
Interest cost	652		660		12			19		664		679
Amortization of unrecognized:
Prior service cost	35		35		—			—		35		35
Actuarial loss / (gain)	20		196		(11		)	—		9		196
Non-pension postretirement benefit expense	$	906	$	1,173	$	1		$	19	$	907	$	1,192

Our 2016 estimate of non-pension cash payments is $5.0 million, and we have paid $0.8 million for the three months ended March 31, 2016.

Net Income (Loss) per Share of Common Stock

Net Income per Share of Common Stock

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



	Three months ended March 31,
(dollars in thousands, except earnings per share)	2016		2015
Numerators for earnings per share:
Net income that is available to common shareholders	$	718	$	3,112

Denominator for basic earnings per share:
Weighted average shares outstanding	21,850,171		21,853,455

Denominator for diluted earnings per share:
Effect of stock options and restricted stock units	150,847		495,159
Adjusted weighted average shares and assumed conversions	22,001,018		22,348,614

Basic earnings per share	$	0.03	$	0.14

Diluted earnings per share	$	0.03	$	0.14

Shares excluded from diluted earnings per share due to:
Inclusion would have been anti-dilutive (excluded from calculation)	616,642		89,006

When applicable, diluted shares outstanding includes the dilutive impact of restricted stock units. Diluted shares also include the impact of eligible employee stock options, which are calculated based on the average share price for each fiscal period using the treasury stock method. Under the treasury stock method, the tax-effected proceeds that hypothetically would be received from the exercise of all in-the-money options are assumed to be used to repurchase shares.

Derivatives

We utilize derivative financial instruments to hedge certain interest rate risks associated with our long-term debt, commodity price risks associated with forecasted future natural gas requirements and foreign exchange rate risks associated with transactions denominated in a currency other than the U.S. dollar. These derivatives, except for the foreign currency contracts and the natural gas contracts used in our Mexican manufacturing facilities, qualify for hedge accounting since the hedges are highly effective, and we have designated and documented contemporaneously the hedging relationships involving these derivative instruments. While we intend to continue to meet the conditions for hedge accounting, if hedges do not qualify as highly effective (as is the case for natural gas contracts used in our Mexico manufacturing facility) or if we do not believe that forecasted transactions would occur, the changes in the fair value of the derivatives used as hedges would be reflected in our earnings. All of these contracts are accounted for under FASB ASC 815 “Derivatives and Hedging.”

Fair Values

The following table provides the fair values of our derivative financial instruments for the periods presented:



	Asset Derivatives:
(dollars in thousands)	March 31, 2016			December 31, 2015
Derivatives not designated as hedging instruments under FASB ASC 815:	Balance Sheet Location	Fair Value		Balance Sheet Location	Fair Value
Currency contracts	Prepaid and other current assets	$	—	Prepaid and other current assets	$	245
Total undesignated		—			245
Total		$	—		$	245

	Liability Derivatives:
(dollars in thousands)	March 31, 2016			December 31, 2015
Derivatives designated as hedging instruments under FASB ASC 815:	Balance Sheet Location	Fair Value		Balance Sheet Location	Fair Value
Natural gas contracts	Derivative liability - current	$	1,129	Derivative liability - current	$	1,069
Natural gas contracts	Other long-term liabilities	50		Other long-term liabilities	34
Interest rate contract	Derivative liability - current	2,322		Derivative liability - current	2,132
Interest rate contract	Other long-term liabilities	2,884		Other long-term liabilities	246
Total designated		6,385			3,481
Derivatives not designated as hedging instruments under FASB ASC 815:
Currency contracts	Derivative liability - current	173		Derivative liability - current	—
Natural gas contracts	Derivative liability - current	722		Derivative liability - current	1,064
Natural gas contracts	Other long-term liabilities	7		Other long-term liabilities	35
Total undesignated		902			1,099
Total		$	7,287		$	4,580

Natural Gas Contracts

We use natural gas swap contracts related to forecasted future North American natural gas requirements. The objective of these commodity contracts is to limit the fluctuations in prices paid due to price movements in the underlying commodity. We consider our forecasted natural gas requirements in determining the quantity of natural gas to hedge. We combine the forecasts with historical observations to establish the percentage of forecast eligible to be hedged, typically ranging from 40 percent to 70 percent of our anticipated requirements, up to eighteen months in the future. The fair values of these instruments are determined from market quotes. As of March 31, 2016, we had commodity contracts for 2,220,000 million British Thermal Units (BTUs) of natural gas. At December 31, 2015, we had commodity contracts for 3,000,000 million BTUs of natural gas.

All of our derivatives for natural gas in the U.S. qualify and are designated as cash flow hedges at March 31, 2016. Hedge accounting is applied only when the derivative is deemed to be highly effective at offsetting changes in fair values or anticipated cash flows of the hedged item or transaction. For hedged forecasted transactions, hedge accounting is discontinued if the forecasted transaction is no longer probable to occur, and any previously deferred gains or losses would be recorded to earnings immediately. Changes in the effective portion of the fair value of these hedges are recorded in other comprehensive income (loss). The ineffective portion of the change in the fair value of a derivative designated as a cash flow hedge is recognized in other income (expense). As the natural gas contracts mature, the accumulated gains (losses) for the respective contracts are reclassified from accumulated other comprehensive loss to current expense in cost of sales in our Condensed Consolidated Statement of Operations.

Since October 1, 2014, our derivatives for natural gas in Mexico have not been designated as cash flow hedges. All mark-to-market changes on these derivatives are being reflected in other income (expense). We recognized a gain (loss) of $0.4 million and $(0.3) million in other income (expense) in the three months ended March 31, 2016 and March 31, 2015, respectively, related to the natural gas contracts where hedge accounting was not elected. Mexico natural gas contracts de-designated in the fourth quarter of 2014 were primarily all utilized by December 31, 2015.

We paid additional cash of $1.2 million in each of the three month periods ended March 31, 2016 and March 31, 2015, due to the difference between the fixed unit rate of our natural gas contracts and the variable unit rate of our natural gas cost from suppliers. Based on our current valuation, we estimate that accumulated losses currently carried in accumulated other comprehensive loss that will be reclassified into earnings over the next twelve months will result in $1.1 million of loss in our Condensed Consolidated Statements of Operations.

The following table provides a summary of the effective portion of derivative gain (loss) recognized in other comprehensive income (loss) from our natural gas contracts:



	Three months ended March 31,
(dollars in thousands)	2016			2015
Derivatives in Cash Flow Hedging relationships:
Natural gas contracts	$	(616	)	$	(829	)
Total	$	(616	)	$	(829	)

The following table provides a summary of the effective portion of derivative gain (loss) reclassified from accumulated other comprehensive loss to the Condensed Consolidated Statements of Operations from our natural gas contracts:



		Three months ended March 31,
(dollars in thousands)		2016			2015
Derivative:	Location:
Natural gas contracts	Cost of sales	$	(540	)	$	(536	)
Total impact on net income (loss)		$	(540	)	$	(536	)

The ineffective portion of derivative gain (loss) related to the de-designated Mexico contracts reclassified from accumulated other comprehensive loss to cost of sales in the Condensed Consolidated Statements of Operations was immaterial for the three months ended March 31, 2015.

The following table provides a summary of the gain (loss) recognized in other income (expense) in the Condensed Consolidated Statements of Operations from our natural gas contracts:



	Three months ended March 31,
(dollars in thousands)	2016		2015
De-designated contracts	$	—	$	(104	)
Contracts where hedge accounting was not elected	370		(295		)
Total	$	370	$	(399	)

Interest Rate Swap

On April 1, 2015, we executed an interest rate swap on our Term Loan B as part of our risk management strategy to mitigate the risks involved with fluctuating interest rates. The interest rate swap effectively converts $220.0 million of our Term Loan B debt from a variable interest rate to a 4.85 percent fixed interest rate, thus reducing the impact of interest rate changes on future income. The fixed rate swap became effective in January 2016 and expires in January 2020. This interest rate swap is valued using the market standard methodology of netting the discounted expected future variable cash receipts and the discounted future fixed cash payments. The variable cash receipts are based on an expectation of future interest rates derived from observed market interest rate forward curves.

Our interest rate swap qualifies and is designated as a cash flow hedge at March 31, 2016 and accounted for under FASB ASC 815 "Derivatives and Hedging". Hedge accounting is applied only when the derivative is deemed to be highly effective at offsetting changes in fair values or anticipated cash flows of the hedged item or transaction. For hedged forecasted transactions, hedge accounting would be discontinued if the forecasted transaction is no longer probable to occur, and any previously deferred gains or losses would be recorded to earnings immediately. Changes in the effective portion of the fair value of these hedges are recorded in other comprehensive income (loss). The ineffective portion, if any, of the change in the fair value of a derivative designated as a cash flow hedge is recognized in other income (expense). Based on our current valuation, we estimate that accumulated losses currently carried in accumulated other comprehensive loss that will be reclassified into earnings over the next twelve months will result in $2.3 million of additional interest expense in our Condensed Consolidated Statements of Operations.

The following table provides a summary of the effective portion of derivative gain (loss) recognized in other comprehensive income (loss) from our interest rate swap:



	Three months ended March 31,
(dollars in thousands)	2016			2015
Derivatives in Cash Flow Hedging relationships:
Interest rate swap	$	(3,219	)	$	—
Total	$	(3,219	)	$	—

The following table provides a summary of the effective portion of derivative gain (loss) reclassified from accumulated other comprehensive income (loss) to the Condensed Consolidated Statements of Operations from our interest rate swap:



		Three months ended March 31,
(dollars in thousands)		2016			2015
Derivative:	Location:
Interest rate swap	Interest expense	$	(391	)	$	—
Total impact on net income (loss)		$	(391	)	$	—

Currency Contracts

Our foreign currency exposure arises from transactions denominated in a currency other than the U.S. dollar primarily associated with our Canadian dollar denominated accounts receivable. From time to time, we enter into a series of foreign currency contracts to sell Canadian dollars. At March 31, 2016 and December 31, 2015, we had C$7.0 million and C$6.2 million in foreign currency contracts, respectively. The fair values of these instruments are determined from market quotes. The values of these derivatives will change over time as cash receipts and payments are made and as market conditions change.

Gains (losses) on currency derivatives that were not designated as hedging instruments are recorded in other income (expense) as follows:



		Three months ended March 31,
(dollars in thousands)		2016			2015
Derivative:	Location:
Currency contracts	Other income (expense)	$	(418	)	$	74
Total		$	(418	)	$	74

We do not believe we are exposed to more than a nominal amount of credit risk in our natural gas hedges, interest rate swap and currency contracts as the counterparties are established financial institutions. The counterparties for the derivative agreements are rated BBB+ or better as of March 31, 2016, by Standard and Poor’s.

Accumulated Other Comprehensive Income (Loss)

Accumulated other comprehensive loss, net of tax, is as follows:



Three months ended March 31, 2016 (dollars in thousands)	Foreign Currency Translation			Derivative Instruments			Pension and Other Postretirement Benefits			Accumulated Other Comprehensive Loss
Balance on December 31, 2015	$	(22,913	)	$	(1,860	)	$	(95,459	)	$	(120,232	)

Other comprehensive income (loss)	3,350			(3,835		)	—			(485		)
Currency impact	—			—			103			103

Amounts reclassified from accumulated other comprehensive income (loss):
Amortization of actuarial loss ⁽¹⁾	—			—			1,331			1,331
Amortization of prior service cost ⁽¹⁾	—			—			47			47
Cost of sales	—			540			—			540
Interest expense	—			391			—			391
Current-period other comprehensive income (loss)	3,350			(2,904		)	1,481			1,927
Tax effect	(145		)	1,046			(492		)	409
Balance on March 31, 2016	$	(19,708	)	$	(3,718	)	$	(94,470	)	$	(117,896	)



Three months ended March 31, 2015 (dollars in thousands)	Foreign Currency Translation			Derivative Instruments			Pension and Other Postretirement Benefits			Accumulated Other Comprehensive Loss
Balance on December 31, 2014	$	(9,162	)	$	(625	)	$	(128,660	)	$	(138,447	)

Other comprehensive income (loss)	(10,490		)	(829		)	—			(11,319		)
Currency impact	—			—			2,291			2,291

Amounts reclassified from accumulated other comprehensive income (loss):
Amortization of actuarial loss ⁽¹⁾	—			—			2,488			2,488
Amortization of prior service cost ⁽¹⁾	—			—			75			75
Cost of sales	—			607			—			607
Current-period other comprehensive income (loss)	(10,490		)	(222		)	4,854			(5,858		)
Tax effect	—			(20		)	(142		)	(162		)
Balance on March 31, 2015	$	(19,652	)	$	(867	)	$	(123,948	)	$	(144,467	)

___________________________

(1) These accumulated other comprehensive income components are included in the computation of net periodic benefit cost within the cost of sales and selling, general and administrative expenses on the Condensed Consolidated Statements of Operations.

Segments

In the fourth quarter of 2015, we revised our reporting segments. Under the new structure, our U.S. and Canada glass tableware business is combined with our U.S. and Canada sourcing business in order to be consistent with the way we manage and report our other segments. Our reporting segments continue to align with our regionally focused organizational structure, which we believe enables us to better serve customers across the globe. We now report financial results for U.S. and Canada; Latin America; Europe, the Middle East and Africa (EMEA); and Other. Sales and segment EBIT continue to reflect end market reporting pursuant to which sales and related costs are included in segment EBIT based on the geographical destination of the sale. The revised 2015 segment results do not affect any previously reported consolidated financial results. Our three reportable segments are defined below. Our operating segment that does not meet the criteria to be a reportable segment is disclosed as Other.

U.S. & Canada—includes worldwide sales of manufactured and sourced glass tableware and sourced ceramic dinnerware, metal tableware, hollowware and serveware having an end market destination in the U.S and Canada excluding glass products for Original Equipment Manufacturers (OEM), which remain in the Latin America segment.

Latin America—includes primarily worldwide sales of manufactured and sourced glass tableware having an end market destination in Latin America including glass products for OEMs that have an end market destination outside of Latin America.

EMEA—includes primarily worldwide sales of manufactured and sourced glass tableware having an end market destination in Europe, the Middle East and Africa.

Other—includes primarily worldwide sales of manufactured and sourced glass tableware having an end market destination in Asia Pacific.

Our measure of profit for our reportable segments is Segment Earnings before Interest and Taxes (Segment EBIT) and excludes amounts related to certain items we consider not representative of ongoing operations as well as certain retained corporate costs and other allocations that are not considered by management when evaluating performance. We use Segment EBIT, along with net sales and selected cash flow information, to evaluate performance and to allocate resources. Segment EBIT for reportable segments includes an allocation of some corporate expenses based on the costs of services performed.

Certain activities not related to any particular reportable segment are reported within retained corporate costs. These costs include certain headquarter, administrative and facility costs, and other costs that are global in nature and are not allocable to the reporting segments.

The accounting policies of the reportable segments are the same as those described in note 2. We do not have any customers who represent 10 percent or more of total sales. Inter-segment sales are consummated at arm’s length and are reflected at end market reporting below.



	Three months ended March 31,
(dollars in thousands)	2016			2015
Net Sales:
U.S. & Canada	$	113,101		$	109,919
Latin America	34,220			39,852
EMEA	26,628			28,509
Other	8,858			9,085
Consolidated	$	182,807		$	187,365

Segment EBIT:
U.S. & Canada	$	13,312		$	10,860
Latin America	4,340			7,088
EMEA	(945		)	(766		)
Other	418			1,870
Total Segment EBIT	$	17,125		$	19,052

Reconciliation of Segment EBIT to Net Income:
Segment EBIT	$	17,125		$	19,052
Retained corporate costs	(6,724		)	(9,495		)
Derivatives⁽¹⁾	370			(399		)
Executive terminations	(4,947		)	(235		)
Interest expense	(5,244		)	(4,523		)
(Provision) benefit for income taxes	138			(1,288		)
Net income	$	718		$	3,112

Depreciation & Amortization:
U.S. & Canada	$	3,456		$	2,792
Latin America	4,542			3,285
EMEA	2,158			2,177
Other	1,428			1,491
Corporate	497			439
Consolidated	$	12,081		$	10,184

Capital Expenditures:
U.S. & Canada	$	3,839		$	10,837
Latin America	2,296			3,681
EMEA	2,218			1,437
Other	695			183
Corporate	807			521
Consolidated	$	9,855		$	16,659

________________________

⁽¹⁾Derivatives relate to hedge ineffectiveness on our natural gas contracts, as well as, mark-to-market adjustments on our natural gas contracts that have been de-designated and those for which we did not elect hedge accounting.

Fair Value

FASB ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. FASB ASC 820 establishes a fair value hierarchy that prioritizes the inputs used in measuring fair value into three broad levels as follows:


•	Level 1 — Quoted prices in active markets for identical assets or liabilities.


•	Level 2 — Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly.


•	Level 3 — Unobservable inputs based on our own assumptions.



	Fair Value at										Fair Value at
Asset / (Liability) (dollars in thousands)	March 31, 2016										December 31, 2015
Asset / (Liability) (dollars in thousands)	Level 1		Level 2			Level 3		Total			Level 1		Level 2			Level 3		Total
Commodity futures natural gas contracts	$	—	$	(1,908	)	$	—	$	(1,908	)	$	—	$	(2,202	)	$	—	$	(2,202	)
Currency contracts	—		(173		)	—		(173		)	—		245			—		245
Interest rate swap	—		(5,206		)	—		(5,206		)	—		(2,378		)	—		(2,378		)
Net derivative asset (liability)	$	—	$	(7,287	)	$	—	$	(7,287	)	$	—	$	(4,335	)	$	—	$	(4,335	)

The fair values of our commodity futures natural gas contracts and currency contracts are determined using observable market inputs. The fair value of our interest rate swap is based on the market standard methodology of netting the discounted expected future variable cash receipts and the discounted future fixed cash payments. The variable cash receipts are based on an expectation of future interest rates derived from observed market interest rate forward curves. Since these inputs are observable in active markets over the terms that the instruments are held, the derivatives are classified as Level 2 in the hierarchy. We also evaluate Company and counterparty risk in determining fair values. The commodity futures natural gas contracts, interest rate swap and currency contracts are hedges of either recorded assets or liabilities or anticipated transactions. Changes in values of the underlying hedged assets and liabilities or anticipated transactions are not reflected in the above table.

The total derivative position is recorded on the Condensed Consolidated Balance Sheets as follows:



Asset / (Liability) (dollars in thousands)	March 31, 2016			December 31, 2015
Prepaid and other current assets	$	—		$	245
Derivative liability	(4,346		)	(4,265		)
Other long-term liabilities	(2,941		)	(315		)
Net derivative asset (liability)	$	(7,287	)	$	(4,335	)

Financial instruments carried at cost on the Condensed Consolidated Balance Sheets, as well as the related fair values, are as follows:



		March 31, 2016				December 31, 2015
(dollars in thousands)	Fair Value Hierarchy Level	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Term Loan B	Level 2	$	427,300	$	423,027	$	433,400	$	425,815

The fair value of our Term Loan B has been calculated based on quoted market prices for the same or similar issues. The fair value of our other immaterial debt approximates carrying value at March 31, 2016 and December 31, 2015. The fair value of our cash and cash equivalents, accounts receivable and accounts payable approximate their carrying value due to their short term nature.

Other Income (Expense)

Items included in other income (expense) in the Condensed Consolidated Statements of Operations are as follows:



	Three months ended March 31,
(dollars in thousands)	2016			2015
Gain (loss) on currency transactions	$	(730	)	$	1,115
Hedge ineffectiveness	370			(399		)
Other non-operating income (expense)	345			111
Other income (expense)	$	(15	)	$	827

Contingencies

Legal Proceedings

From time to time, we are identified as a "potentially responsible party" (PRP) under the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (CERCLA) and/or similar state laws that impose liability without regard to fault for costs and damages relating to the investigation and clean-up of contamination resulting from releases or threatened releases of hazardous substances. We are also subject to similar laws in some of the countries where our facilities are located. Our environmental, health and safety department monitors compliance with applicable laws on a global basis.

On October 30, 2009, the United States Environmental Protection Agency ("U.S. EPA") designated Syracuse China Company ("Syracuse China"), our wholly-owned subsidiary, as one of eight PRPs with respect to the Lower Ley Creek sub-site of the Onondaga Lake Superfund site located near the ceramic dinnerware manufacturing facility that Syracuse China operated from 1995 to 2009 in Syracuse, New York. As a PRP, we may be required to pay a share of the costs of investigation and remediation of the Lower Ley Creek sub-site.

U.S. EPA has completed its Remedial Investigation (RI), Feasibility Study (FS), Risk Assessment (RA) and Proposed Remedial Action Plan (PRAP). U.S. EPA issued its Record of Decision (RoD) on September 30, 2014. The RoD indicates that U.S. EPA's estimate of the undiscounted cost of remediation ranges between approximately $17.0 million (assuming local disposal of contaminated sediments is feasible) and approximately $24.8 million (assuming local disposal is not feasible). However, the RoD acknowledges that the final cost of the cleanup will depend upon the actual volume of contaminated material, the degree to which it is contaminated, and where the excavated soil and sediment is properly disposed. In connection with the General Motors Corporation bankruptcy, U.S. EPA recovered $22.0 million from Motors Liquidation Company (MLC), the successor to General Motors Corporation. If the cleanup costs do not exceed the amount recovered by U.S. EPA from MLC, Syracuse China may suffer no loss. If, and to the extent the cleanup costs exceed the amount recovered by U.S. EPA from MLC, it is not yet known whether other PRPs will be added to the current group of PRPs or how any excess costs may be allocated among the PRPs.

On March 3, 2015, the EPA issued to the PRPs notices and requests to negotiate performance of the remedial design (RD) work. The notices contemplate that any agreement to perform the RD work would be memorialized in an Administrative Order on Consent (AOC). The EPA and PRPs currently are discussing entering into an AOC pursuant to which some or all of the PRPs would agree to perform the RD work. The EPA and PRPs anticipate that the RD work will produce additional information from which the feasibility of a local disposal option and the cleanup costs can be better determined. The EPA has declined to advance the GM Settlement Funds for the RD work, instead conditioning use of those funds to reimburse for the RD work upon the successful completion of the RD work and the finalization of an AOC to perform the remedial action work.

To the extent that Syracuse China has a liability with respect to the Lower Ley Creek sub-site, including without limitation costs to fund the RD work, and to the extent the liability arose prior to our 1995 acquisition of the Syracuse China assets, the liability would be subject to the indemnification provisions contained in the Asset Purchase Agreement between the Company and The Pfaltzgraff Co. (now known as TPC-York, Inc. ("TPC York")) and certain of its subsidiaries. Accordingly, Syracuse China has notified TPC York of its claim for indemnification under the Asset Purchase Agreement.

In connection with the above proceedings, an estimated environmental liability of $1.1 million has been recorded in other long term liabilities and a recoverable amount of $0.6 million has been recorded in other long term assets in the Condensed Consolidated Balance Sheets at both March 31, 2016 and December 31, 2015. Although we cannot predict the ultimate outcome of this proceeding, we believe that it will not have a material adverse impact on our financial condition, results of operations or liquidity.

Significant Accounting Policies (Policies)

Basis of Presentation [Policy Text Block]

Basis of Presentation

The Condensed Consolidated Financial Statements include Libbey Inc. and its majority-owned subsidiaries (collectively, Libbey or the Company). Our fiscal year end is December 31^st. All material intercompany accounts and transactions have been eliminated. The preparation of financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the Condensed Consolidated Financial Statements and accompanying notes. Actual results could differ materially from management’s estimates.

Revenue Recognition and Cost of Sales [Policy Text Block]

Condensed Consolidated Statements of Operations

Net sales in our Condensed Consolidated Statements of Operations include revenue earned when products are shipped and title and risk of loss have passed to the customer. Revenue is recorded net of returns, discounts and incentives offered to customers. Cost of sales includes cost to manufacture and/or purchase products, warehouse, shipping and delivery costs and other costs.

Foreign Currency Translation [Policy Text Block]

Foreign Currency Translation

Assets and liabilities of non-U.S. subsidiaries that operate in a local currency environment, where that local currency is the functional currency, are translated to U.S. dollars at exchange rates in effect at the balance sheet date, with the resulting translation adjustments directly recorded to a separate component of accumulated other comprehensive loss. Income and expense accounts are translated at average exchange rates during the year. The effect of exchange rate changes on transactions denominated in currencies other than the functional currency is recorded in other income (expense).

Income Taxes [Policy Text Block]

Income Taxes

Income taxes are accounted for under the asset and liability method. Deferred income tax assets and liabilities are recognized for estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax attribute carry-forwards. Deferred income tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. Financial Accounting Standards Board Accounting Standards Codification™ (FASB ASC) Topic 740, “Income Taxes,” requires that a valuation allowance be recorded when it is more likely than not that some portion or all of the deferred income tax assets will not be realized. Deferred income tax assets and liabilities are determined separately for each tax paying component in which we conduct our operations or otherwise incur taxable income or losses. See note 5 for further discussion.

We review the need for valuation allowances in all jurisdictions on a quarterly basis in order to assess the likelihood of the realization of our deferred tax assets. In assessing the need for recording or reversing a valuation allowance, we weigh all available positive and negative evidence. Examples of the evidence we consider are cumulative losses in recent years, losses expected in early future years, a history of potential tax benefits expiring unused, prudent and feasible tax planning strategies that could be implemented, and whether there were unusual, infrequent or extraordinary items to be considered.

For interim tax reporting, we estimate our annual effective tax rate and apply it to our year-to-date ordinary income. Tax jurisdictions with a projected or year-to-date loss for which a tax benefit cannot be realized are excluded from the annualized effective tax rate. The tax effects of unusual or infrequently occurring items, including changes in judgment about valuation allowances and effects of changes in tax laws or rates, are reported in the interim period in which they occur.

Stock-Based Compensation [Policy Text Block]

Stock-Based Compensation Expense

We account for stock-based compensation expense in accordance with FASB ASC Topic 718, “Compensation — Stock Compensation,” and FASB ASC Topic 505-50, “Equity — Equity-Based Payments to Non-Employees”. Stock-based compensation cost is measured based on the fair value of the equity instruments issued. FASB ASC Topics 718 and 505-50 apply to all of our outstanding unvested stock-based payment awards.

New Accounting Standards [Policy Text Block]

New Accounting Standards

In May 2014, the FASB issued Accounting Standards Update No. 2014-09, "Revenue From Contracts With Customers" (ASU 2014-09), which outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. ASU 2014-09 is based on the principle that an entity should recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2014-09 also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to fulfill a contract. Entities have the option of using either a full retrospective or a modified retrospective approach for the adoption of the new standard. This update is effective for interim and annual reporting periods beginning after December 15, 2016; early adoption is not permitted. In August 2015, the FASB issued ASU 2015-14 which defers the effective date one year from January 1, 2017 to January 1, 2018, but early adoption as of January 1, 2017 is permitted. In March of 2016 the FASB issued ASU 2016-08, "Revenue From Contracts With Customers: Principal vs. Agent Considerations" (ASU 2016-08). ASU 2016-08 provides more detailed guidance in determining principal or agent determination and when revenue should be recorded when a performance obligation is completed. We are currently assessing the impact that these standards will have on our Condensed Consolidated Financial Statements.

In August 2014, the FASB issued Accounting Standards Update No. 2014-15, "Presentation of Financial Statements-Going Concern" (ASU 2014-15), which establishes management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern in connection with preparing financial statements for each annual and interim reporting period. ASU 2014-15 also provides guidance to determine whether to disclose information about relevant conditions and events when there is substantial doubt about an entity’s ability to continue as a going concern. This update is effective for the annual reporting period ending after December 15, 2016, and for interim and annual periods thereafter. Early application is permitted. We are currently evaluating the impact that this standard will have on our Condensed Consolidated Financial Statements.

In May 2015, the FASB issued Accounting Standards Update 2015-07, "Disclosures for Investments in Certain Entities that Calculate Net Asset Value Per Share (or its Equivalent)" (ASU 2015-07), which removes the requirement to categorize within the fair value hierarchy investments for which fair values are estimated using the net asset value practical expedient provided by FASB ASC Topic 820, Fair Value Measurement. Disclosures about investments in certain entities that calculate net asset value per share are limited under ASU 2015-07 to those investments for which the entity has elected to estimate the fair value using the net asset value practical expedient. ASU 2015-07 is effective for entities for fiscal years beginning after December 15, 2015 and interim periods within, with retrospective application to all periods presented. Early application is permitted. Although there is no impact on our 2016 interim financial statements, we are currently assessing the impact that this standard will have on our Consolidated Financial Statements at December 31, 2016.

In July 2015, the FASB issued Accounting Standards Update No. 2015-11, "Inventory (Topic 330): Simplifying the Measurement of Inventory" (ASU 2015-11), which requires that inventory be measured at the lower of its cost or the estimated sale price, minus the costs of completing the sale, which the FASB calls the net realizable value. This update is effective for interim and annual reporting periods beginning after December 15, 2016, with early adoption permitted. We are currently evaluating the impact that this standard will have on our Condensed Consolidated Financial Statements.

In February 2016, the FASB issued Accounting Standards Update No. 2016-02, "Leases (Topic 842)" (ASU 2016-02), which requires a lessee to recognize assets and liabilities for leases with lease terms of more than 12 months on the balance sheet. Leases will be classified as either finance or operating leases, with classification affecting the pattern of expense recognition in the income statement. The new guidance also clarifies the definition of a lease and disclosure requirements. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, with early application permitted. We are currently assessing the impact that this standard will have on our Condensed Consolidated Financial Statements.

In March 2016, the FASB issued Accounting Standards Update No. 2016-09, "Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting" (ASU 2016-09). Areas for simplification in this update involve several aspects of accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. ASU 2016-09 is effective for interim and annual reporting periods beginning after December 15, 2016, with early application permitted. We are currently assessing the impact that this standard will have on our Condensed Consolidated Financial Statements.

Pension and Other Postretirement Plans, Pensions, Policy [Policy Text Block]

We have pension plans covering the majority of our employees. Benefits generally are based on compensation and service for salaried employees and job grade and length of service for hourly employees. In addition, we have an unfunded supplemental employee retirement plan (SERP) that covers certain salaried U.S.-based employees of Libbey hired before January 1, 2006. The U.S. pension plans cover the salaried U.S.-based employees of Libbey hired before January 1, 2006 and most hourly U.S.-based employees (excluding employees hired at Shreveport after 2008 and at Toledo after September 30, 2010). Effective January 1, 2013, we ceased annual company contribution credits to the cash balance accounts in our Libbey U.S. Salaried Pension Plan and SERP. The non-U.S. pension plans cover the employees of our wholly owned subsidiary in Mexico. The plan in Mexico is unfunded.

Pension and Other Postretirement Plans, Nonpension Benefits, Policy [Policy Text Block]

We provide certain retiree health care and life insurance benefits covering our U.S. and Canadian salaried employees hired before January 1, 2004 and a majority of our union hourly employees (excluding employees hired at Shreveport after 2008 and at Toledo after September 30, 2010). Employees are generally eligible for benefits upon retirement and completion of a specified number of years of creditable service. Benefits for most hourly retirees are determined by collective bargaining. The U.S. non-pension postretirement plans cover the hourly and salaried U.S.-based employees of Libbey (excluding those mentioned above). The non-U.S. non-pension postretirement plans cover the retirees and active employees of Libbey who are located in Canada. The postretirement benefit plans are unfunded.

Earnings Per Share [Policy Text Block]

When applicable, diluted shares outstanding includes the dilutive impact of restricted stock units. Diluted shares also include the impact of eligible employee stock options, which are calculated based on the average share price for each fiscal period using the treasury stock method. Under the treasury stock method, the tax-effected proceeds that hypothetically would be received from the exercise of all in-the-money options are assumed to be used to repurchase shares.

Derivatives [Policy Text Block]

Derivatives

We utilize derivative financial instruments to hedge certain interest rate risks associated with our long-term debt, commodity price risks associated with forecasted future natural gas requirements and foreign exchange rate risks associated with transactions denominated in a currency other than the U.S. dollar. These derivatives, except for the foreign currency contracts and the natural gas contracts used in our Mexican manufacturing facilities, qualify for hedge accounting since the hedges are highly effective, and we have designated and documented contemporaneously the hedging relationships involving these derivative instruments. While we intend to continue to meet the conditions for hedge accounting, if hedges do not qualify as highly effective (as is the case for natural gas contracts used in our Mexico manufacturing facility) or if we do not believe that forecasted transactions would occur, the changes in the fair value of the derivatives used as hedges would be reflected in our earnings. All of these contracts are accounted for under FASB ASC 815 “Derivatives and Hedging.”

Segment Reporting [Policy Text Block]