UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 
Washington, DC 20549
____________________

FORM 8-K
____________________

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 27, 2015
________________________
Libbey Inc.
(Exact name of registrant as specified in its charter)
________________________

	
					
Delaware	 	1-12084	 	34-1559357	
(State of incorporation)	 	(Commission File Number)	 	(IRS Employer identification No.)	

	
			
300 Madison Avenue
Toledo, Ohio	 	43604	
(Address of principal executive offices)	 	(Zip Code)	
Registrant's telephone number, including area code: (419) 325-2100
________________________________

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions (see General Instructions A.2. below):

o       Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o       Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o       Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o       Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

	

 
Item 2.02 Results of Operations and Financial Condition

The information in this Item is furnished to, but not filed with, the Securities and Exchange Commission solely under Item 2.02 of Form 8-K, “Results of Operations and Financial Condition.”

On February 27, 2015 , Libbey Inc. (“Libbey” or the “Company”) issued a press release announcing financial results for the fourth quarter ended December 31, 2014 . A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits

d) Exhibits 99.1 Press release dated February 27, 2015

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	
					
 	Libbey Inc.
Registrant
 	 	
Date: February 27, 2015	By:  	/s/ Sherry L. Buck	 	
 	 	Sherry L. Buck	 	
 	 	Vice President and Chief Financial Officer	 	

Exhibit Index

	
				
Exhibit No.	 	Description	 	
99.1	 	Text of press release dated February 27, 2015	 	

Libbey Inc.
Page 1

Exhibit 99.1

		

	Libbey Inc.
300 Madison Ave
P.O. Box 10060
Toledo, OH 43699	

	

NEWS RELEASE

	
			
INVESTOR CONTACT:	 	MEDIA CONTACT:     	
Kenneth Boerger	 	Lisa Fell	
Vice President and Treasurer	 	Director of Corporate Communications	
(419) 325-2279	 	(419) 325-2001	
ken.boerger@libbey.com	 	lfell@libbey.com	

FOR IMMEDIATE RELEASE
FRIDAY, FEBRUARY 27, 2015     

LIBBEY INC. ANNOUNCES RECORD FOURTH QUARTER AND FULL-YEAR 2014
NET SALES ON CONTINUED STRONG REVENUE GROWTH
 
Fourth quarter sales increased 4.7 percent, compared to the fourth quarter of 2013,
and were the highest fourth quarter sales in Company history

TOLEDO, OHIO, FEBRUARY 27, 2015 --Libbey Inc. (NYSE MKT: LBY) today reported results for the fourth quarter and year-ended December 31, 2014.

Fourth Quarter Financial Highlights

•	Sales for the fourth quarter were $231.4 million, compared to $221.0 million for the fourth quarter of 2013, an increase of 4.7 percent (7.1 percent excluding currency fluctuation).	

•	Net income for the fourth quarter was $19.8 million, compared to $9.3 million in the prior-year fourth quarter. Adjusted net income (see Table 1) for the fourth quarter was $11.9 million, compared to the $12.8 million adjusted net income recorded in the fourth quarter of 2013.	

•	Adjusted earnings before interest, taxes, depreciation and amortization (Adjusted EBITDA) (see Table 3) for the quarter was $30.7 million, compared to $37.6 million in the prior-year quarter. Adjusted EBITDA of $30.7 million was at the high end of the Company's previous guidance of $29.0 million to $31.0 million.	

•	Own the Moment strategic foundation announced at 2015 Investor Day is driven by a balanced capital allocation strategy, including an $0.11 per share quarterly dividend, repurchases of up to 1.5 million shares and reinvestment in the business.	

"For the third consecutive quarter, we were able to defend and grow our market share in an extremely competitive market, as sales grew in each of our segments, excluding currency impacts. Adjusted EBITDA results were

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Libbey Inc.
Page 2

positively impacted by our North American capacity realignment and productivity improvements, but these gains were offset by the items we outlined at our Investor Day in January: costs associated with an earlier-than-planned furnace repair, strategic growth initiatives, negative sales mix, higher than expected currency impact from the weaker peso and euro and unplanned non-income tax assessments. We are pleased with our overall Company sales growth of 4.7 percent, 7.1 percent excluding currency fluctuation, during the quarter. We look forward to continuing our strong sales performance during 2015, as we leverage the investments we have made in new products, sales and marketing capabilities," said Stephanie A. Streeter, chief executive officer of Libbey Inc.
 
Fourth Quarter Segment Sales and Operational Review

•	Sales in the Americas segment were $165.7 million, compared to $154.1 million in the fourth quarter of 2013, an increase of 7.5 percent (8.9 percent excluding currency impact). Contributing to the increase were a 3.2 percent increase in sales in our foodservice channel, an increase of 8.9 percent in retail and a 10.5 percent increase in the business-to-business channel.	

•	Sales in the EMEA segment decreased 6.6 percent (an increase of 1.2 percent excluding currency impact) to $36.2 million, compared to $38.7 million in the fourth quarter of 2013.	

•	Sales in U.S. Sourcing were $21.1 million in the fourth quarter of 2014, compared to $19.8 million in the prior-year quarter, as sales of World Tableware and Syracuse China flatware and dinnerware increased 6.7 percent.	

•	Sales in Other were $8.5 million, similar to the prior-year quarter, resulting from a 0.8 percent increase in sales (1.9 percent excluding currency impact) in the Asia Pacific region.	

•	Adjusted EBITDA was $30.7 million (see Table 3) compared to $37.6 million reported in the prior-year quarter. The increased sales and the realization of savings of approximately $3.6 million from the recently completed North American capacity realignment positively impacted adjusted EBITDA. However, these favorable factors were more than offset by an unfavorable sales mix, the $3.9 million impact of costs related to an earlier-than-planned furnace repair, higher input costs for natural gas and electricity of $0.9 million, $1.6 million in unplanned non-income tax assessments as well as increased selling and marketing expenses and expenses incurred in connection with other strategic growth initiatives.	

•	Interest expense was $4.9 million, a decrease of $2.8 million, compared to $7.7 million in the year-ago period, primarily driven by lower interest rates as a result of the refinancing completed during the second quarter of 2014.	

•	Our effective tax rate was 16.4 percent for the quarter-ended December 31, 2014, compared to 42.5 percent for the quarter-ended December 31, 2013. The effective rate in both years was generally influenced by foreign earnings with differing statutory rates, foreign withholding tax, accruals related to uncertain tax positions and other activity in jurisdictions with recorded valuation allowances.	

Full-Year 2014 Financial Highlights

•	Sales for the full-year 2014 were $852.5 million, compared to $818.8 million for 2013, an increase of 4.1 percent (or 4.7 percent excluding currency fluctuation).	

•	Income from operations for 2014 was $81.2 million, compared to $74.6 million in 2013.	

•	Adjusted EBITDA (see Table 3) was $123.4 million for the full-year 2014, compared to $135.3 million for 2013.	

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Libbey Inc.
Page 3

Full-Year 2014 Segment Sales and Operational Review

•	Sales in the Americas segment were $591.4 million, compared to $560.8 million in 2013, an increase of 5.4 percent (6.3 percent excluding currency fluctuation), including increases in all channels of distribution.	

•	Sales in the EMEA segment increased 0.8 percent to $147.6 million, compared to $146.5 million in 2013.	

•	Sales in the U.S. Sourcing segment increased 3.2 percent to $80.8 million, compared to $78.3 million in 2013.	

•	Sales in Other were $32.7 million, compared to $33.2 million in the prior-year period. This decrease was the result of a 1.5 percent decrease in sales in the Asia Pacific region.	

•	Interest expense for 2014 was $22.9 million, a decrease of $9.1 million, compared to $32.0 million in 2013, primarily driven by lower interest rates as a result of the refinancing completed during the second quarter of 2014.	

•	Our effective tax rate was 63.3 percent for the full-year 2014, compared to 31.8 percent for 2013. The effective tax rate was generally influenced by foreign earnings with differing statutory rates, foreign withholding tax, accruals related to uncertain tax positions and other activity in jurisdictions with recorded valuation allowances.	

Balance Sheet and Liquidity

•	Libbey reported that it had available capacity of $82.3 million under its ABL credit facility as of December 31, 2014, with no loans currently outstanding. The Company also had cash on hand of $60.0 million at December 31, 2014, including in excess of $26.0 million in the U.S.	

•	As of December 31, 2014, working capital, defined as inventories and accounts receivable less accounts payable, was $178.4 million, compared to $216.8 million at September 30, 2014, and $173.1 million at December 31, 2013 (see Table 5). Working capital increased $5.3 million, compared to the prior year, but was reduced during the quarter by $38.4 million, as the result of the Company's focus on working capital reduction.	

Sherry Buck, chief financial officer, added: "We generated a significant amount of free cash flow during the fourth quarter, as a result of working capital reductions of over $38 million and receipt of approximately $10 million in insurance proceeds related to a claim for the furnace malfunction in 2013. We also continued to realize lower interest expense during the fourth quarter, compared to the prior year, which resulted in a reduction of over $9 million of interest expense for the full year. As we look to 2015, we expect to continue our strong free cash flow performance."

Buck added, "Since the implementation of our 10b5-1 share repurchase plan on December 15, 2014, we have repurchased over 180,000 shares of stock at an average purchase price of approximately $32.92 per share. At a minimum, we would expect to repurchase all 1.5 million shares under our current authorization by year-end 2017."

Outlook for 2015

For the full-year 2015, the Company provided a performance outlook consistent with the long-term goals it disclosed at its January 23, 2015, Investor Day. For the year 2015 the company expects:

•	Sales growth of approximately 3 percent, 5 to 6 percent on a constant currency basis	

•	Adjusted EBITDA margins of approximately 15 percent	

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Libbey Inc.
Page 4

•	Capital expenditures in the range of $55 million to $60 million	
Webcast Information

Libbey will hold a conference call for investors on Friday, February 27, 2015, at 11 a.m. Eastern Standard Time. The conference call will be simulcast live on the Internet and is accessible from the Investor Relations' section of www.libbey.com . To listen to the call, please go to the website at least 10 minutes early to register, download and install any necessary software. A replay will be available for 7 days after the conclusion of the call.

About Libbey Inc.

Based in Toledo, Ohio, since 1888, we believe Libbey Inc. is the largest manufacturer of glass tableware in the western hemisphere and one of the largest glass tableware manufacturers in the world. Libbey supplies products to foodservice, retail, industrial and business-to-business customers in over 100 countries and is the leading manufacturer of tabletop products for the U.S. foodservice industry.

Libbey operates glass tableware manufacturing plants in the United States in Louisiana and Ohio as well as in Mexico, China, Portugal and the Netherlands. Its Crisa subsidiary, located in Monterrey, Mexico, is a leading producer of glass tableware in Mexico and Latin America. Its subsidiary located in Leerdam, Netherlands, is among the world leaders in producing and selling glass stemware to retail, foodservice and industrial clients. Its Crisal subsidiary, located in Portugal, provides an expanded presence in Europe. Its Syracuse China subsidiary designs and distributes an extensive line of high-quality ceramic dinnerware, principally for foodservice establishments in the United States. Its World Tableware subsidiary imports and sells a full line of metal flatware and hollowware and an assortment of ceramic dinnerware and other tabletop items, principally for foodservice establishments in the United States. In 2014, Libbey Inc.'s net sales totaled $852.5 million.

This press release includes forward-looking statements as defined in Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements reflect only the Company's best assessment at this time and are indicated by words or phrases such as "goal," "expects," " believes," "will," "estimates," "anticipates," or similar phrases. Investors are cautioned that forward-looking statements involve risks and uncertainty and that actual results may differ materially from these statements, and that investors should not place undue reliance on such statements. These forward-looking statements may be affected by the risks and uncertainties in the Company's business. This information is qualified in its entirety by cautionary statements and risk factor disclosures contained in the Company's Securities and Exchange Commission filings, including the Company's report on Form 10-K filed with the Commission on March 12, 2014. Important factors potentially affecting performance include but are not limited to risks related to our ability to borrow under our ABL credit agreement; increased competition from foreign suppliers endeavoring to sell glass tableware in the United States and Mexico; the impact of lower duties for imported products; global economic conditions and the related impact on consumer spending levels; major slowdowns in the retail, travel or entertainment industries in the United States, Canada, Mexico, Western Europe and Asia, caused by terrorist attacks or otherwise; significant increases in per-unit costs for natural gas, electricity, freight, corrugated packaging, and other purchased materials; high levels of indebtedness; high interest rates that increase the Company's borrowing costs or volatility in the financial markets that could constrain liquidity and credit availability; protracted work stoppages related to collective bargaining agreements; increases in expense associated with higher medical costs, increased pension expense associated with lower returns on pension investments and increased pension obligations; devaluations and other major currency fluctuations relative to the U.S. dollar and the Euro that could reduce the cost competitiveness of the Company's products compared to foreign competition; the effect of high inflation in Mexico and exchange rate changes to the value of the Mexican peso and the earnings and cash flow of Libbey Mexico, expressed under U.S. GAAP; the inability to achieve savings and profit improvements at targeted levels in the Company's operations or within the intended time periods; and whether the Company completes any significant acquisition and whether such acquisitions can operate profitably. Any forward-looking statements speak only as of the date of this press release, and the Company assumes no obligation to update or revise any forward-looking statement to reflect events or circumstances arising after the date of this press release.

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Libbey Inc.
Condensed Consolidated Statements of Operations
(dollars in thousands, except per-share amounts)
(unaudited)

	
								
 	Three months ended December 31,	
 	2014	 	2013	
 	 	 	 	
Net sales	$	231,418		 	$	221,045		
Freight billed to customers	762		 	897		
Total revenues	232,180		 	221,942		
Cost of sales (1)	171,956		 	172,124		
Gross profit	60,224		 	49,818		
Selling, general and administrative expenses (1)	32,732		 	28,430		
Special charges (1)	—		 	240		
Income from operations	27,492		 	21,148		
Other income (1)	1,011		 	2,737		
Earnings before interest and income taxes	28,503		 	23,885		
Interest expense	4,882		 	7,739		
Income before income taxes	23,621		 	16,146		
Provision for income taxes (1)	3,864		 	6,861		
Net income	$	19,757		 	$	9,285		
 	 	 	 	
Net income per share:	 	 	 	
Basic	$	0.90		 	$	0.43		
Diluted	$	0.88		 	$	0.42		
 	 	 	 	
Weighted average shares:	 	 	 	
Outstanding	21,861		 	21,429		
Diluted	22,332		 	21,975		

(1) Refer to Table 1 for Special Items detail .

Libbey Inc.
Condensed Consolidated Statements of Operations
(dollars in thousands, except per-share amounts)
(unaudited)

	
								
 	Year ended December 31,	
 	2014	 	2013	
 	 	 	 	
Net sales	$	852,492		 	$	818,811		
Freight billed to customers	3,400		 	3,344		
Total revenues	855,892		 	822,155		
Cost of sales (1)	652,747		 	632,738		
Gross profit	203,145		 	189,417		
Selling, general and administrative expenses (1)	121,909		 	109,981		
Special charges (1)	—		 	4,859		
Income from operations	81,236		 	74,577		
Loss on redemption of debt (1)	(47,191	)	 	(2,518	)	
Other income (1)	2,351		 	1,647		
Earnings before interest and income taxes	36,396		 	73,706		
Interest expense	22,866		 	32,006		
Income before income taxes	13,530		 	41,700		
Provision for income taxes (1)	8,567		 	13,241		
Net income	$	4,963		 	$	28,459		
 	 	 	 	
Net income per share:	 	 	 	
Basic	$	0.23		 	$	1.34		
Diluted	$	0.22		 	$	1.31		
 	 	 	 	
Weighted average shares:	 	 	 	
Outstanding	21,716		 	21,217		
Diluted	22,184		 	21,742		

(1) Refer to Table 2 for Special Items detail .

Libbey Inc.
Condensed Consolidated Balance Sheets
(dollars in thousands)

								
 	December 31, 2014	 	December 31, 2013	
 	(unaudited)	 	 	
ASSETS:	 	 	 	
Cash and cash equivalents	$	60,044		 	$	42,208		
Accounts receivable — net	91,106		 	94,549		
Inventories — net	169,828		 	163,121		
Other current assets	27,701		 	24,838		
Total current assets	348,679		 	324,716		
 	 	 	 	
Pension asset	848		 	33,615		
Goodwill and purchased intangibles — net	181,883		 	186,704		
Property, plant and equipment — net	277,978		 	265,662		
Other assets	19,542		 	19,293		
Total assets	$	828,930		 	$	829,990		
 	 	 	 	
LIABILITIES AND SHAREHOLDERS' EQUITY:	 	 	 	
Accounts payable	$	82,485		 	$	79,620		
Accrued liabilities	71,673		 	73,821		
Pension liability (current portion)	1,488		 	3,161		
Non-pension postretirement benefits (current portion)	4,800		 	4,758		
Other current liabilities	8,296		 	1,374		
Long-term debt due within one year	7,658		 	5,391		
Total current liabilities	176,400		 	168,125		
 	 	 	 	
Long-term debt	436,264		 	406,512		
Pension liability	56,462		 	40,033		
Non-pension postretirement benefits	63,301		 	59,065		
Other liabilities	19,049		 	25,446		
Total liabilities	751,476		 	699,181		
 	 	 	 	
Common stock and capital in excess of par value	331,609		 	323,580		
Treasury stock	(1,060	)	 	—		
Retained deficit	(114,648	)	 	(119,611	)	
Accumulated other comprehensive loss	(138,447	)	 	(73,160	)	
Total shareholders’ equity	77,454		 	130,809		
Total liabilities and shareholders’ equity	$	828,930		 	$	829,990		

Libbey Inc.
Condensed Consolidated Statements of Cash Flows
(dollars in thousands)
(unaudited)

								
 	Three months ended December 31,	
 	2014	 	2013	
 	 	 	 	
Operating activities:	 	 	 	
Net income	$	19,757		 	$	9,285		
Adjustments to reconcile net income to net cash provided by operating activities:	 	 	 	
Depreciation and amortization	9,551		 	9,799		
Loss on asset sales and disposals	427		 	—		
Change in accounts receivable	16,517		 	(2,527	)	
Change in inventories	17,995		 	10,838		
Change in accounts payable	5,282		 	18,189		
Accrued interest and amortization of discounts and finance fees	310		 	(6,380	)	
Pension & non-pension postretirement benefits	(3,299	)	 	(576	)	
Restructuring	—		 	(646	)	
Accrued liabilities & prepaid expenses	(3,605	)	 	(4,455	)	
Income taxes	3,310		 	4,481		
Share-based compensation expense	1,537		 	1,764		
Other operating activities	(655	)	 	1,485		
Net cash provided by operating activities	67,127		 	41,257		
 	 	 	 	
Investing activities:	 	 	 	
Additions to property, plant and equipment	(18,178	)	 	(19,255	)	
Proceeds from furnace malfunction insurance recovery	(1,996	)	 	—		
Proceeds from asset sales and other	17		 	—		
Net cash used in investing activities	(20,157	)	 	(19,255	)	
 	 	 	 	
Financing activities:	 	 	 	
Borrowings on ABL credit facility	28,300		 	8,200		
Repayments on ABL credit facility	(37,200	)	 	(8,200	)	
Other repayments	(547	)	 	(9,759	)	
Repayments on Term Loan B	(1,100	)	 	—		
Stock options exercised	1,690		 	277		
Treasury shares purchased	(1,060	)	 	—		
Net cash used in financing activities	(9,917	)	 	(9,482	)	
 	 	 	 	
Effect of exchange rate fluctuations on cash	(1,098	)	 	222		
Increase in cash	35,955		 	12,742		
 	 	 	 	
Cash & cash equivalents at beginning of period	24,089		 	29,466		
Cash & cash equivalents at end of period	$	60,044		 	$	42,208		

Libbey Inc.
Condensed Consolidated Statements of Cash Flows
(dollars in thousands)
(unaudited)

								
 	Year ended December 31,	
 	2014	 	2013	
 	 	 	 	
Operating activities:	 	 	 	
Net income	$	4,963		 	$	28,459		
Adjustments to reconcile net income to net cash provided by operating activities:	 	 	 	
Depreciation and amortization	40,388		 	43,969		
Loss on asset sales and disposals	674		 	514		
Change in accounts receivable	(1,808	)	 	(12,674	)	
Change in inventories	(10,828	)	 	(3,932	)	
Change in accounts payable	7,401		 	12,190		
Accrued interest and amortization of discounts and finance fees	2,039		 	1,496		
Call premium on senior notes	37,348		 	1,350		
Write-off of finance fees on senior notes	9,086		 	1,168		
Pension & non-pension postretirement benefits	(879	)	 	7,746		
Restructuring	(289	)	 	2,212		
Accrued liabilities & prepaid expenses	(7,222	)	 	(17,507	)	
Income taxes	885		 	(1,804	)	
Share-based compensation expense	5,283		 	5,063		
Other operating activities	(2,857	)	 	4,479		
Net cash provided by operating activities	84,184		 	72,729		
 	 	 	 	
Investing activities:	 	 	 	
Additions to property, plant and equipment	(56,706	)	 	(49,407	)	
Proceeds from furnace malfunction insurance recovery	2,350		 	—		
Proceeds from asset sales and other	24		 	81		
Net cash used in investing activities	(54,332	)	 	(49,326	)	
 	 	 	 	
Financing activities:	 		 	 		
Borrowings on ABL credit facility	83,000		 	51,000		
Repayments on ABL credit facility	(83,000	)	 	(51,000	)	
Other repayments	(5,863	)	 	(14,270	)	
Other borrowings	5,214		 	6,094		
Payments on 6.875% senior notes	(405,000	)	 	(45,000	)	
Proceeds from Term Loan B	438,900		 	—		
Repayments on Term Loan B	(2,200	)	 	—		
Call premium on senior notes	(37,348	)	 	(1,350	)	
Stock options exercised	4,571		 	5,384		
Debt issuance costs and other	(6,959	)	 	—		
Treasury shares purchased	(1,060	)	 	—		
Net cash used in financing activities	(9,745	)	 	(49,142	)	
 	 	 	 	
Effect of exchange rate fluctuations on cash	(2,271	)	 	739		
Increase (decrease) in cash	17,836		 	(25,000	)	
 	 	 	 	
Cash & cash equivalents at beginning of year	42,208		 	67,208		
Cash & cash equivalents at end of year	$	60,044		 	$	42,208		

In accordance with the SEC’s Regulation G, tables 1 through 6 provide non-GAAP measures used in this earnings release and a reconciliation to the most closely related Generally Accepted Accounting Principle (GAAP) measure. Libbey believes that providing supplemental non-GAAP financial information is useful to investors in understanding Libbey's core business and trends. In addition, it is the basis on which Libbey's management assesses performance. Although Libbey believes that the non-GAAP financial measures presented enhance investors' understanding of Libbey's business and performance, these non-GAAP measures should not be considered an alternative to GAAP.

																									
Table 1	 	 	 	 	 	 	 	 	 	 	 	 	
Reconciliation of "As Reported" Results to "As Adjusted" Results - Quarter	 	 	
(dollars in thousands, except per-share amounts)	 	 	 	 	 	 	
(unaudited)	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	Three months ended December 31,	
 	 	2014	 	2013	
 	 	As Reported	 	Special Items	 	As Adjusted	 	As Reported	 	Special Items	 	As Adjusted	
Net sales	 	$	231,418		 	$	—		 	$	231,418		 	$	221,045		 	$	—		 	$	221,045		
Freight billed to customers	 	762		 	—		 	762		 	897		 	—		 	897		
Total revenues	 	232,180		 	—		 	232,180		 	221,942		 	—		 	221,942		
Cost of sales	 	171,956		 	(10,349	)	 	182,305		 	172,124		 	3,933		 	168,191		
Gross profit	 	60,224		 	10,349		 	49,875		 	49,818		 	(3,933	)	 	53,751		
Selling, general and administrative expenses	 	32,732		 	1,649		 	31,083		 	28,430		 	1,401		 	27,029		
Special charges	 	—		 	—		 	—		 	240		 	240		 	—		
Income from operations	 	27,492		 	8,700		 	18,792		 	21,148		 	(5,574	)	 	26,722		
Other income (expense)	 	1,011		 	(1,317	)	 	2,328		 	2,737		 	1,844		 	893		
Earnings before interest and income taxes	 	28,503		 	7,383		 	21,120		 	23,885		 	(3,730	)	 	27,615		
Interest expense	 	4,882		 	—		 	4,882		 	7,739		 	—		 	7,739		
Income before income taxes	 	23,621		 	7,383		 	16,238		 	16,146		 	(3,730	)	 	19,876		
Provision for income taxes	 	3,864		 	(482	)	 	4,346		 	6,861		 	(196	)	 	7,057		
Net income	 	$	19,757		 	$	7,865		 	$	11,892		 	$	9,285		 	$	(3,534	)	 	$	12,819		
 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income per share:	 	 	 	 	 	 	 	 	 	 	 	 	
Basic	 	$	0.90		 	$	0.36		 	$	0.54		 	$	0.43		 	$	(0.17	)	 	$	0.60		
Diluted	 	$	0.88		 	$	0.35		 	$	0.53		 	$	0.42		 	$	(0.16	)	 	$	0.58		
 	 	 	 	 	 	 	 	 	 	 	 	 	
Weighted average shares:	 	 	 	 	 	 	 	 	 	 	 	 	
Outstanding	 	21,861		 	 	 	 	 	21,429		 	 	 	 	
Diluted	 	22,332		 	 	 	 	 	21,975		 	 	 	 	

	
																									
 	 	Three months ended December 31, 2014	
Special Items Detail - (Income) Expense:	 	Furnace Malfunction (1)	 	Executive Retirement	 	Pension Settlement	 	Derivatives  (2)	 	Environmental Obligation (3)	 	Total Special Items	
Cost of sales	 	$	(10,664	)	 	$	—		 	$	—		 	$	—		 	$	315		 	$	(10,349	)	
SG&A	 	—		 	875		 	774		 	—		 	—		 	1,649		
Other (income) expense	 	—		 	—		 	—		 	1,317		 	—		 	1,317		
Income taxes	 	—		 	—		 	(87	)	 	(395	)	 	—		 	(482	)	
Total Special Items	 	$	(10,664	)	 	$	875		 	$	687		 	$	922		 	$	315		 	$	(7,865	)	

																					
 	 	Three months ended December 31, 2013	
Special Items Detail - (Income) Expense:	 	Restructuring Charges (4)	 	Furnace Malfunction (1)	 	Pension Settlement	 	Executive Retirement	 	Total Special Items	
Cost of sales	 	$	(14	)	 	$	3,835		 	$	112		 	$	—		 	$	3,933		
SG&A	 	—		 	—		 	665		 	736		 	1,401		
Special charges	 	240		 	—		 	—		 	—		 	240		
Other (income) expense	 	—		 	(1,844	)	 	—		 	—		 	(1,844	)	
Income taxes	 	163		 	(115	)	 	(300	)	 	56		 	(196	)	
Total Special Items	 	$	389		 	$	1,876		 	$	477		 	$	792		 	$	3,534		

(1) Furnace malfunction relates to loss of production and disposal of fixed assets, net of insurance recoveries, at our Toledo, Ohio, manufacturing facility.
(2) Derivatives relate to hedge ineffectiveness and mark-to-market adjustments on our natural gas contracts that have been de-designated and those for which we did not elect hedge accounting.
(3) Environmental obligation relates to our assessment of Syracuse China Company as a potentially responsible party with respect to the Lower Ley Creek sub-site of the Onondaga Lake Superfund site.
(4) Restructuring charges relate to discontinuing production of certain glassware in North America and reducing manufacturing capacity at our Shreveport, Louisiana, manufacturing facility.

	
																									
Table 2	 	 	 	 	 	 	 	 	 	 	 	 	
Reconciliation of "As Reported" Results to "As Adjusted" Results - Year	 	 	
(dollars in thousands, except per-share amounts)	 	 	 	 	 	 	
(unaudited)	 	 	
 	 	Year ended December 31,	
 	 	2014	 	2013	
 	 	As Reported	 	Special Items	 	As Adjusted	 	As Reported	 	Special Items	 	As Adjusted	
Net sales	 	$	852,492		 	$	—		 	$	852,492		 	$	818,811		 	$	—		 	$	818,811		
Freight billed to customers	 	3,400		 	—		 	3,400		 	3,344		 	—		 	3,344		
Total revenues	 	855,892		 	—		 	855,892		 	822,155		 	—		 	822,155		
Cost of sales	 	652,747		 	(3,482	)	 	656,229		 	632,738		 	8,381		 	624,357		
Gross profit	 	203,145		 	3,482		 	199,663		 	189,417		 	(8,381	)	 	197,798		
Selling, general and administrative expenses	 	121,909		 	1,649		 	120,260		 	109,981		 	4,345		 	105,636		
Special charges	 	—		 	—		 	—		 	4,859		 	4,859		 	—		
Income from operations	 	81,236		 	1,833		 	79,403		 	74,577		 	(17,585	)	 	92,162		
Loss on redemption of debt	 	(47,191	)	 	(47,191	)	 	—		 	(2,518	)	 	(2,518	)	 	—		
Other income (expense)	 	2,351		 	(1,247	)	 	3,598		 	1,647		 	928		 	719		
Earnings before interest and income taxes	 	36,396		 	(46,605	)	 	83,001		 	73,706		 	(19,175	)	 	92,881		
Interest expense	 	22,866		 	—		 	22,866		 	32,006		 	—		 	32,006		
Income before income taxes	 	13,530		 	(46,605	)	 	60,135		 	41,700		 	(19,175	)	 	60,875		
Provision for income taxes	 	8,567		 	(823	)	 	9,390		 	13,241		 	(2,067	)	 	15,308		
Net income	 	$	4,963		 	$	(45,782	)	 	$	50,745		 	$	28,459		 	$	(17,108	)	 	$	45,567		
 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income per share:	 	 	 	 	 	 	 	 	 	 	 	 	
Basic	 	$	0.23		 	$	(2.11	)	 	$	2.34		 	$	1.34		 	$	(0.81	)	 	$	2.15		
Diluted	 	$	0.22		 	$	(2.06	)	 	$	2.29		 	$	1.31		 	$	(0.79	)	 	$	2.10		
 	 	 	 	 	 	 	 	 	 	 	 	 	
Weighted average shares:	 	 	 	 	 	 	 	 	 	 	 	 	
Outstanding	 	21,716		 	 	 	 	 	21,217		 	 	 	 	
Diluted	 	22,184		 	 	 	 	 	21,742		 	 	 	 	

	
																																	
 	 	Year ended December 31, 2014	
Special Items Detail - (Income) Expense:	 	Restructuring
Charges (1)	 	Pension Settlement	 	Debt Cost (2)	 	Furnace
Malfunction (3)	 	Executive Retirement	 	Derivatives (4)	 	Environmental Obligation (5)	 	Total Special Items	
Cost of sales	 	$	985		 	$	—		 	$	—		 	$	(4,782	)	 	$	—		 	$	—		 	$	315		 	$	(3,482	)	
SG&A	 	—		 	774		 	—		 	—		 	875		 	—		 	—		 	1,649		
Loss on redemption of debt	 	—		 	—		 	47,191		 	—		 	—		 	—		 	—		 	47,191		
Other (income) expense	 	—		 	—		 	—		 	—		 	—		 	1,247		 	—		 	1,247		
Income taxes	 	(296	)	 	(87	)	 	—		 	(45	)	 	—		 	(395	)	 	—		 	(823	)	
Total Special Items	 	$	689		 	$	687		 	$	47,191		 	$	(4,827	)		$	875		 	$	852		 	$	315		 	$	45,782		

																																	
 	 	Year ended December 31, 2013	
Special Items Detail - (Income) Expense:	 	Restructuring
Charge (1)	 	Furnace
Malfunction (3)	 	Abandoned Property	 	Pension Settlement	 	Debt Costs (2)	 	Executive Retirement	 	Derivatives (4)	 	Total Special Items	
Cost of sales	 	$	1,685		 	$	6,272		 	$	—		 	$	424		 	$	—		 	$	—		 	$	—		 	$	8,381		
SG&A	 	—		 	—		 	1,781		 	1,828		 	—		 	736		 	—		 	4,345		
Special charges	 	4,859		 	—		 	—		 	—		 	—		 	—		 	—		 	4,859		
Loss on redemption of debt	 	—		 	—		 	—		 	—		 	2,518		 	—		 	—		 	2,518		
Other (income) expense	 	—		 	(1,844	)	 	—		 	 	 	 	 	—		 	916		 	(928	)	
Income taxes	 	(614	)	 	(415	)	 	(167	)	 	(566	)	 	(236	)	 	(69	)	 	—		 	(2,067	)	
Total Special Items	 	$	5,930		 	$	4,013		 	$	1,614		 	$	1,686		 	$	2,282		 	$	667		 	$	916		 	$	17,108		

(1) Restructuring charges relate to discontinuing production of certain glassware in North America and reducing manufacturing capacity at our Shreveport, Louisiana, facility.
(2) Debt costs for 2014 include the write-off of unamortized finance fees and call premium payments on the $405.0 million senior notes redeemed in April and May 2014, and the write-off of the debt carrying value adjustment related to the termination of the $45.0 million interest rate swap. Debt costs for 2013 include the write-off of unamortized finance fees and call premium payments on the $45.0 million senior notes redeemed in May 2013.
(3) Furnace malfunction relates to loss of production and disposal of fixed assets, net of insurance recoveries, at our Toledo, Ohio, manufacturing facility.
(4) In 2014, derivatives primarily relate to hedge ineffectiveness and mark-to-market adjustments on our natural gas contracts that have been de-designated and those for which we did not elect hedge accounting. In 2013, $0.3 million related to hedge ineffectiveness on our natural gas hedges and $0.6 million related to the hedge ineffectiveness on our interest rate swap.
(5) Environmental obligation relates to our assessment of Syracuse China Company as a potentially responsible party with respect to the Lower Ley Creek sub-site of the Onondaga Lake Superfund site.

	
																	
Table 3	 	 	 	 	 	 	 	 	
Reconciliation of Net Income to Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) and Adjusted EBITDA	
(dollars in thousands)	 	 	 	 	 	 	 	 	
(unaudited)	 	 	 	 	 	 	 	 	
 	 	Three months ended
December 31,	 	Year ended December 31,	
 	 	2014	 	2013	 	2014	 	2013	
Reported net income	 	$	19,757		 	$	9,285		 	$	4,963		 	$	28,459		
Add:	 	 	 	 	 	 	 	 	
Interest expense	 	4,882		 	7,739		 	22,866		 	32,006		
Provision for income taxes	 	3,864		 	6,861		 	8,567		 	13,241		
Depreciation and amortization	 	9,551		 	9,799		 	40,388		 	43,969		
EBITDA	 	38,054		 	33,684		 	76,784		 	117,675		
Add: Special items before interest and taxes	 	(7,383	)	 	3,730		 	46,605		 	19,175		
Less: Depreciation expense included in special items and
     also in depreciation and amortization above	 	—		 	166		 	—		 	(1,533	)	
Adjusted EBITDA	 	$	30,671		 	$	37,580		 	$	123,389		 	$	135,317		

	
																	
Table 4	 	 	 	 	 	 	 	 	
Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow	
(dollars in thousands)	 	 	 	 	 	 	 	 	
(unaudited)	 	 	 	 	 	 	 	 	
 	 	Three months ended
December 31,	 	Year ended December 31,	
 	 	2014	 	2013	 	2014	 	2013	
Net cash provided by operating activities	 	$	67,127		 	$	41,257		 	$	84,184		 	$	72,729		
Capital expenditures	 	(18,178	)	 	(19,255	)	 	(56,706	)	 	(49,407	)	
Proceeds from furnace malfunction insurance recovery	 	(1,996	)	 	—		 	2,350		 	—		
Proceeds from asset sales and other	 	17		 	—		 	24		 	81		
Free Cash Flow	 	$	46,970		 	$	22,002		 	$	29,852		 	$	23,403		

	
													
Table 5	 	 	 	 	 	 	
Reconciliation to Working Capital	
(dollars in thousands)	 	 	 	 	 	 	
(unaudited)	 	 	 	 	 	 	
 	 	September 30, 2014	 	December 31, 2014	 	December 31, 2013	
Add:	 	 	 	 	 	 	
Accounts receivable	 	$	106,459		 	$	91,106		 	$	94,549		
Inventories	 	189,221		 	169,828		 	163,121		
Less: Accounts payable	 	78,895		 	82,485		 	79,620		
Less: Receivable on furnace malfunction insurance claim	 	—		 	—		 	5,000		
Working Capital	 	$	216,785		 	$	178,449		 	$	173,050		

	
																	
Table 6	 	 	 	 	 	 	 	 	
Summary Business Segment Information	 	 	 	 	 	 	 	 	
(dollars in thousands)
(unaudited)	 	Three months ended December 31,	 	Year ended December 31,	
Net Sales:	 	2014	 	2013	 	2014	 	2013	
	 	 	 	 	 	 	 	 	
Americas (1)	 	$	165,650		 	$	154,100		 	$	591,391		 	$	560,840		
EMEA (2)	 	36,174		 	38,741		 	147,587		 	146,455		
U.S. Sourcing (3)	 	21,078		 	19,754		 	80,782		 	78,302		
Other (4)	 	8,516		 	8,450		 	32,732		 	33,214		
Consolidated	 	$	231,418		 	$	221,045		 	$	852,492		 	$	818,811		
 	 	 	 	 	 	 	 	 	
Segment Earnings Before Interest & Taxes (Segment EBIT) (5)  :	 	 	 	 	 	 	
Americas (1)	 	$	24,996		 	$	29,028		 	$	98,460		 	$	100,534		
EMEA (2)	 	2,654		 	2,046		 	5,726		 	874		
U.S. Sourcing (3)	 	1,620		 	2,566		 	6,995		 	9,752		
Other (4)	 	343		 	2,194		 	2,378		 	3,374		
Segment EBIT	 	$	29,613		 	$	35,834		 	$	113,559		 	$	114,534		
 	 	 	 	 	 	 	 	 	
Reconciliation of Segment EBIT to Net Income:	 	 	 	 	 	 	 	 	
Segment EBIT	 	$	29,613		 	$	35,834		 	$	113,559		 	$	114,534		
Retained corporate costs (6)	 	(8,493	)	 	(8,219	)	 	(30,558	)	 	(21,653	)	
Consolidated Adjusted EBIT	 	21,120		 	27,615		 	83,001		 	92,881		
Loss on redemption of debt	 	—		 	—		 	(47,191	)	 	(2,518	)	
Pension settlement	 	(774	)	 	(777	)	 	(774	)	 	(2,252	)	
Furnace malfunction	 	10,664		 	(1,991	)	 	4,782		 	(4,428	)	
Environmental obligation	 	(315	)	 	—		 	(315	)	 	—		
Restructuring charges	 	—		 	(226	)	 	(985	)	 	(6,544	)	
Derivatives (7)	 	(1,317	)	 	—		 	(1,247	)	 	(916	)	
Abandoned property	 	—		 	—		 	—		 	(1,781	)	
Executive retirement	 	(875	)	 	(736	)	 	(875	)	 	(736	)	
Special items before interest and taxes	 	7,383		 	(3,730	)	 	(46,605	)	 	(19,175	)	
Interest expense	 	(4,882	)	 	(7,739	)	 	(22,866	)	 	(32,006	)	
Income taxes	 	(3,864	)	 	(6,861	)	 	(8,567	)	 	(13,241	)	
Net income	 	$	19,757		 	$	9,285		 	$	4,963		 	$	28,459		
 	 	 	 	 	 	 	 	 	
Depreciation & Amortization:	 	 	 	 	 	 	 	 	
Americas (1)	 	$	5,893		 	$	5,129		 	$	22,856		 	$	24,953		
EMEA (2)	 	2,073		 	2,526		 	10,061		 	10,449		
U.S. Sourcing (3)	 	5		 	6		 	25		 	33		
Other (4)	 	1,463		 	1,925		 	6,179		 	7,275		
Corporate	 	117		 	213		 	1,267		 	1,259		
Consolidated	 	$	9,551		 	$	9,799		 	$	40,388		 	$	43,969		
(1) Americas—includes worldwide sales of manufactured and sourced glass tableware having an end market destination in North and South America.
(2) EMEA—includes worldwide sales of manufactured and sourced glass tableware having an end market destination in Europe, the Middle East and Africa.
(3) U.S. Sourcing—includes U.S. sales of sourced ceramic dinnerware, metal tableware, hollowware, and serveware.
(4) Other—includes worldwide sales of manufactured and sourced glass tableware having an end market destination in Asia Pacific.
(5) Segment EBIT represents earnings before interest and taxes 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.
(6) Retained corporate costs includes certain headquarter, administrative and facility costs, and other costs that are not allocable to the reporting segments.
(7) Derivatives relate to hedge ineffectiveness and mark-to-market adjustments on our natural gas contracts that have been de-designated and those for which we did not elect hedge accounting. 2013 also includes hedge ineffectiveness on our interest rate swap.