LIBBEY INC, 10-Q filed on 8/8/2014
Quarterly Report
Document and Entity Information
6 Months Ended
Jun. 30, 2014
Jul. 31, 2014
Entity Information [Line Items]
 
 
Entity Registrant Name
LIBBEY INC 
 
Entity Central Index Key
0000902274 
 
Current Fiscal Year End Date
--12-31 
 
Entity Filer Category
Accelerated Filer 
 
Document Type
10-Q 
 
Document Period End Date
Jun. 30, 2014 
 
Document Fiscal Year Focus
2014 
 
Document Fiscal Period Focus
Q2 
 
Amendment Flag
false 
 
Entity Common Stock, Shares Outstanding
 
21,615,953 
Condensed Consolidated Statements of Operations (USD $)
In Thousands, except Per Share data, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Net sales
$ 223,536 
$ 209,904 
$ 405,117 
$ 393,380 
Freight billed to customers
893 
771 
1,707 
1,523 
Total revenues
224,429 
210,675 
406,824 
394,903 
Cost of sales
164,162 
153,213 
314,218 
295,209 
Gross profit
60,267 
57,462 
92,606 
99,694 
Selling, general and administrative expenses
30,726 
29,635 
59,604 
56,032 
Special charges
(85)
4,229 
Income from operations
29,541 
27,912 
33,002 
39,433 
Loss on redemption of debt
(47,191)
(2,518)
(47,191)
(2,518)
Other income (expense)
322 
51 
(384)
Earnings (loss) before interest and income taxes
(17,328)
25,445 
(14,189)
36,531 
Interest expense
5,486 
8,126 
13,187 
16,561 
Income (loss) before income taxes
(22,814)
17,319 
(27,376)
19,970 
Provision for income taxes
2,354 
4,883 
1,176 
5,545 
Net income (loss)
$ (25,168)
$ 12,436 
$ (28,552)
$ 14,425 
Net income (loss) per share:
 
 
 
 
Basic
$ (1.16)
$ 0.58 
$ (1.32)
$ 0.68 
Diluted
$ (1.16)
$ 0.57 
$ (1.32)
$ 0.66 
Dividends per share
$ 0 
$ 0 
$ 0 
$ 0 
Condensed Consolidated Statements of Comprehensive Income (Loss) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Net income (loss)
$ (25,168)
$ 12,436 
$ (28,552)
$ 14,425 
Other comprehensive income (loss):
 
 
 
 
Pension and other postretirement benefit adjustments, net of tax
2,084 
6,412 
3,433 
9,083 
Change in fair value of derivative instruments, net of tax
(412)
(509)
(274)
536 
Foreign currency translation adjustments
(785)
2,335 
(1,373)
(590)
Other comprehensive income, net of tax
887 
8,238 
1,786 
9,029 
Comprehensive income (loss)
$ (24,281)
$ 20,674 
$ (26,766)
$ 23,454 
Condensed Consolidated Balance Sheets (USD $)
In Thousands, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
Assets:
 
 
Cash and cash equivalents
$ 23,209 
$ 42,208 
Accounts receivable - net
106,345 
94,549 
Inventories - net
182,100 
163,121 
Prepaid and other current assets
34,920 
24,838 
Total current assets
346,574 
324,716 
Pension asset
34,481 
33,615 
Purchased intangible assets - net
18,751 
19,325 
Goodwill
167,379 
167,379 
Deferred income taxes
5,761 
5,759 
Other assets
10,968 
13,534 
Total other assets
237,340 
239,612 
Property, plant and equipment - net
265,790 
265,662 
Total assets
849,704 
829,990 
Liabilities and Shareholders' Equity:
 
 
Accounts payable
80,546 
79,620 
Salaries and wages
27,326 
32,403 
Accrued liabilities
48,415 
41,418 
Accrued income taxes
1,374 
Pension liability (current portion)
3,135 
3,161 
Non-pension postretirement benefits (current portion)
4,758 
4,758 
Long-term debt due within one year
9,761 
5,391 
Total current liabilities
173,941 
168,125 
Long-term debt
446,179 
406,512 
Pension liability
39,083 
40,033 
Non-pension postretirement benefits
58,849 
59,065 
Deferred income taxes
11,656 
11,672 
Other long-term liabilities
11,739 
13,774 
Total liabilities
741,447 
699,181 
Shareholders' equity:
 
 
Common stock, par value $.01 per share, 50,000,000 shares authorized, 21,558,786 shares issued in 2014 (21,316,480 shares issued in 2013)
216 
213 
Capital in excess of par value
327,578 
323,367 
Retained deficit
(148,163)
(119,611)
Accumulated other comprehensive loss
(71,374)
(73,160)
Total shareholders' equity
108,257 
130,809 
Total liabilities and shareholders' equity
$ 849,704 
$ 829,990 
Condensed Consolidated Balance Sheets Parenthetical (USD $)
Jun. 30, 2014
Dec. 31, 2013
Common stock, par value
$ 0.01 
$ 0.01 
Common stock, shares authorized
50,000,000 
50,000,000 
Common stock, shares issued
21,558,786 
21,316,480 
Condensed Consolidated Statements of Cash Flows (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Operating activities:
 
 
 
 
Net income (loss)
$ (25,168)
$ 12,436 
$ (28,552)
$ 14,425 
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
 
 
 
 
Depreciation and amortization
10,592 
11,623 
21,268 
22,397 
(Gain) loss on asset sales and disposals
17 
31 
13 
33 
Change in accounts receivable
(19,481)
(4,836)
(16,399)
(10,879)
Change in inventories
(8,168)
(7,857)
(19,363)
(18,492)
Change in accounts payable
6,667 
1,428 
1,352 
(6,317)
Accrued interest and amortization of discounts and finance fees
(5,911)
(7,521)
1,345 
610 
Call premium on senior notes
37,348 
1,350 
37,348 
1,350 
Write-off of finance fees on senior notes
9,086 
1,168 
9,086 
1,168 
Pension & non-pension postretirement benefits
1,397 
1,504 
2,769 
5,204 
Restructuring
(46)
(659)
(289)
3,655 
Accrued liabilities & prepaid expenses
4,647 
(793)
(7,722)
(16,585)
Income taxes
(770)
(2,553)
(3,923)
(4,179)
Share-based compensation expense
1,634 
1,485 
2,637 
2,309 
Other operating activities
(1,491)
2,579 
(1,586)
2,006 
Net cash provided by (used in) operating activities
10,353 
9,385 
(2,016)
(3,295)
Investing activities:
 
 
 
 
Additions to property, plant and equipment
(11,934)
(10,889)
(21,835)
(19,771)
Proceeds from furnace malfunction insurance recovery
 
 
4,346 
Proceeds from asset sales and other
Net cash (used in) investing activities
(11,934)
(10,885)
(17,485)
(19,763)
Financing activities:
 
 
 
 
Borrowing on ABL credit facility
21,300 
30,400 
21,300 
30,400 
Repayments on ABL credit facility
(14,300)
(20,600)
(14,300)
(20,600)
Other repayments
(65)
(55)
(115)
(114)
Other borrowings
1,964 
1,964 
Payments on 6.875% senior notes
(405,000)
(45,000)
(405,000)
(45,000)
Proceeds from Term Loan B
438,900 
438,900 
Call premium on senior notes
(37,348)
(1,350)
(37,348)
(1,350)
Stock options exercised
1,786 
2,511 
2,122 
3,048 
Debt issuance costs and other
(6,868)
(6,868)
Net cash provided by (used in) financing activities
369 
(34,094)
655 
(33,616)
Effect of exchange rate fluctuations on cash
(52)
189 
(153)
10 
Increase (decrease) in cash
(1,264)
(35,405)
(18,999)
(56,664)
Cash at beginning of period
24,473 
45,949 
42,208 
67,208 
Cash at end of period
23,209 
10,544 
23,209 
10,544 
Supplemental disclosure of cash flows information:
 
 
 
 
Cash paid during the period for interest, net of capitalized interest
11,483 
15,560 
11,667 
15,848 
Cash paid during the period for income taxes
$ 1,477 
$ 5,931 
$ 3,293 
$ 7,815 
Condensed Consolidated Statements of Cash Flows Parenthetical (Subsidiary, Libbey Glass [Member], Senior Notes [Member])
Jun. 30, 2014
May 9, 2014
Subsidiary, Libbey Glass [Member] |
Senior Notes [Member]
 
 
Interest rate
6.875% 
6.875% 1
Description of the Business
Description of the Business
Description of the Business

Libbey is a leading global manufacturer and marketer of glass tableware products. We believe we have the largest manufacturing, distribution and service network among glass tableware manufacturers in the Western Hemisphere, in addition to supplying to key markets throughout the world. 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
Significant Accounting Policies
Significant Accounting Policies

See our Form 10-K for the year ended December 31, 2013 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 31st. 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 jurisdiction in which we conduct our operations or otherwise incur taxable income or losses. In the United States, Portugal and the Netherlands, we have recorded valuation allowances against our deferred income tax assets. See note 6 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. Under the terms of the CEO retention award agreement, 115,687 cash settled restricted stock units were granted during the first quarter of 2014. These awards cliff vest on December 31, 2018. Accordingly, awards that will be settled in cash are subject to liability accounting and the fair value of such awards will be remeasured at the end of each reporting period until settled or expired. Stock-based compensation expense charged to the Condensed Consolidated Statements of Operations is as follows:
 
 
Three months ended June 30,
 
Six months ended June 30,
(dollars in thousands)
 
2014
 
2013
 
2014
 
2013
Stock-based compensation expense
 
$
1,634

 
$
1,485

 
$
2,637

 
$
2,309


Reclassifications

Certain amounts in the prior year financial statements have been reclassified to conform to the current year presentation.

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. We are currently assessing the impact that this standard will have on our condensed consolidated financial statements.
Balance Sheet Details
Balance Sheet Details
Balance Sheet Details

The following table provides detail of selected balance sheet items:
(dollars in thousands)
June 30, 2014
 
December 31, 2013
Accounts receivable:
 
 
 
Trade receivables
$
104,114

 
$
87,499

Other receivables (see note 14)
2,231

 
7,050

Total accounts receivable, less allowances of $6,234 and $5,846
$
106,345

 
$
94,549

 
 
 
 
Inventories:
 
 
 
Finished goods
$
163,247

 
$
144,945

Work in process
1,687

 
1,615

Raw materials
4,790

 
4,558

Repair parts
11,058

 
10,550

Operating supplies
1,318

 
1,453

Total inventories, less loss provisions of $4,577 and $4,913
$
182,100

 
$
163,121

 
 
 
 
Prepaid and other current assets:
 
 
 
Value added tax
$
13,254

 
$
6,697

Prepaid expenses
10,674

 
8,396

Deferred income taxes
5,840

 
5,840

Prepaid income taxes
4,970

 
3,511

Derivative asset
182

 
394

Total prepaid and other current assets
$
34,920

 
$
24,838

 
 
 
 
Other assets:
 
 
 
Deposits
$
1,092

 
$
919

Finance fees — net of amortization
7,484

 
10,472

Other assets
2,392

 
2,143

Total other assets
$
10,968

 
$
13,534

 
 
 
 
Accrued liabilities:
 
 
 
Accrued incentives
$
24,156

 
$
17,830

Workers compensation
6,873

 
7,108

Medical liabilities
3,109

 
3,433

Interest
3,871

 
3,331

Commissions payable
1,072

 
1,067

Withholdings and other non-income tax accruals
2,134

 
1,929

Other accrued liabilities
7,200

 
6,720

Total accrued liabilities
$
48,415

 
$
41,418

 
 
 
 
Other long-term liabilities:
 
 
 
Deferred liability
$
7,237

 
$
7,424

Derivative liability
76

 
2,073

Other long-term liabilities
4,426

 
4,277

Total other long-term liabilities
$
11,739

 
$
13,774



Borrowings
Borrowings
Borrowings

On April 9, 2014, we completed the refinancing of substantially all of the existing indebtedness of our wholly-owned subsidiaries Libbey Glass and Libbey Europe B.V. The refinancing included:

the entry into an amended and restated credit agreement with respect to our ABL Facility;
the issuance of $440.0 million in aggregate principal amount of Senior Secured Term Loan B facility of Libbey Glass due 2021 (Term Loan B); and
the repurchase and cancellation of all Libbey Glass's then outstanding $405.0 million in aggregate principal amount Senior Secured Notes ($360.0 million on April 9, 2014 and $45.0 million on May 9, 2014).

We used the proceeds of the Term Loan B, together with cash on hand and borrowings under the ABL Facility, to repurchase $360.0 million of the Senior Secured Notes, redeem the remaining $45.0 million of the Senior Secured Notes, and pay certain related fees and expenses.

The above transactions included charges of $37.3 million for an early call premium and $9.1 million for the write off of the remaining financing fees from the Senior Secured Notes. These charges were considered in the computation of the loss on redemption of debt.

Borrowings consist of the following:
(dollars in thousands)
Interest Rate
 
Maturity Date
June 30,
2014
 
December 31,
2013
Borrowings under ABL Facility
floating
 
April 9, 2019
$
7,000

 
$

Term Loan B
floating
 
April 9, 2021
440,000

 

Senior Secured Notes
6.875%
(1)
May 15, 2020

 
405,000

Promissory Note
6.00%
 
July, 2014 to September, 2016
566

 
681

RMB Working Capital Loan
floating
 
September, 2014
5,119

 
5,157

AICEP Loan
0.00%
 
January, 2016 to July 30, 2018
4,319

 
2,389

Total borrowings
 
 
 
457,004

 
413,227

Less — unamortized discount
 
 
 
1,064

 

Plus — carrying value adjustment on debt related to the Interest Rate Agreement (1)

 
(1,324
)
Total borrowings — net
 
 
 
455,940

 
411,903

Less — long term debt due within one year
 
 
9,761

 
5,391

Total long-term portion of borrowings — net
 
$
446,179

 
$
406,512

_____________________________
(1)
See Interest Rate Agreement under “Term Loan B and Senior Secured Notes” below and in note 9.

Amended and Restated ABL Credit Agreement

Libbey Glass and Libbey Europe entered into an Amended and Restated Credit Agreement, dated as of February 8, 2010 and amended as of April 29, 2011, May 18, 2012 and April 9, 2014 (as amended, the ABL Facility), with a group of four financial institutions. The ABL Facility provides for borrowings of up to $100.0 million, subject to certain borrowing base limitations, reserves and outstanding letters of credit.

All borrowings under the ABL Facility are secured by:
a first-priority security interest in substantially all of the existing and future personal property of Libbey Glass and its domestic subsidiaries (ABL Priority Collateral);
a first-priority security interest in:
100 percent of the stock of Libbey Glass and 100 percent of the stock of substantially all of Libbey Glass’s present and future direct and indirect domestic subsidiaries;
100 percent of the non-voting stock of substantially all of Libbey Glass’s first-tier present and future foreign subsidiaries; and
65 percent of the voting stock of substantially all of Libbey Glass’s first-tier present and future foreign subsidiaries
a first priority security interest in substantially all proceeds and products of the property and assets described above; and
a second-priority security interest in substantially all of the owned real property, equipment and fixtures in the United States of Libbey Glass and its domestic subsidiaries, subject to certain exceptions and permitted liens (Term Priority Collateral).

Additionally, borrowings by Libbey Europe under the ABL Facility are secured by:
a first-priority lien on substantially all of the existing and future real and personal property of Libbey Europe and its Dutch subsidiaries; and
a first-priority security interest in:
100 percent of the stock of Libbey Europe and 100 percent of the stock of substantially all of the Dutch subsidiaries; and
100 percent (or a lesser percentage in certain circumstances) of the outstanding stock issued by the first-tier foreign subsidiaries of Libbey Europe and its Dutch subsidiaries.

Swingline borrowings are limited to $15.0 million, with swingline borrowings for Libbey Europe being limited to the U.S. equivalent of $7.5 million. Loans comprising each CBFR (CB Floating Rate) Borrowing, including each Swingline Loan, bear interest at the CB Floating Rate plus the Applicable Rate, and euro-denominated swingline borrowings (Eurocurrency Loans) bear interest calculated at the Netherlands swingline rate, as defined in the ABL Facility. The Applicable Rates for CBFR Loans and Eurocurrency Loans vary depending on our aggregate remaining availability. The Applicable Rates for CBFR Loans and Eurocurrency Loans were 0.50 percent and 1.50 percent, respectively, at June 30, 2014. Libbey pays a quarterly Commitment Fee, as defined by the ABL Facility, on the total credit provided under the ABL Facility. The Commitment Fee was 0.25 percent at June 30, 2014. No compensating balances are required by the Agreement. The Agreement does not require compliance with a fixed charge coverage ratio covenant unless aggregate unused availability falls below $10.0 million. If our aggregate unused ABL availability were to fall below $10.0 million, the fixed charge coverage ratio requirement would be 1:00 to 1:00. Libbey Glass and Libbey Europe have the option to increase the ABL Facility by $25.0 million. There were borrowings of $7.0 million under the facility at June 30, 2014. There were no Libbey Glass or Libbey Europe borrowings under the facility at December 31, 2013. Interest is payable on the last day of the interest period, which can range from one month to six months depending on the maturity of each individual borrowing on the facility.

The borrowing base under the ABL Facility is determined by a monthly analysis of the eligible accounts receivable and inventory. The borrowing base is the sum of (a) 85 percent of eligible accounts receivable and (b) the lesser of (i) 85 percent of the net orderly liquidation value (NOLV) of eligible inventory, (ii) 65 percent of eligible inventory, or (iii) $75.0 million.

The available total borrowing base is offset by rent reserves totaling $0.7 million. There were no mark-to-market reserves for natural gas contracts offsetting the borrowing base as of June 30, 2014. The ABL Facility also provides for the issuance of $30.0 million of letters of credit, which are applied against the $100.0 million limit. At June 30, 2014, we had $6.8 million in letters of credit outstanding under the ABL Facility. Remaining unused availability under the ABL Facility was $79.7 million at June 30, 2014, compared to $70.5 million under the ABL Facility at December 31, 2013.

Term Loan B and Senior Secured Notes

On April 9, 2014, Libbey Glass consummated its $440.0 million Term Loan B. The net proceeds of the Term Loan B were $438.9 million, after the 0.25 percent original issue discount of $1.1 million. The Term Loan B had related fees of approximately $6.7 million that will be amortized to interest expense over the life of the loan.

The Term Loan B is evidenced by a Senior Secured Credit Agreement, dated April 9, 2014 (Credit Agreement), between Libbey Glass, the Company, the domestic subsidiaries of Libbey Glass listed as guarantors therein (Subsidiary Guarantors and together with the Company, Guarantors), and the lenders. Under the terms of the Credit Agreement, aggregate principal of $1.1 million is due on the last business day of each quarter beginning September 30, 2014. The Term Loan B bears interest at the rate of LIBOR plus 3.0 percent, subject to a LIBOR "floor" of 0.75 percent. The interest rate was 3.75 percent per year at June 30, 2014, and will mature on April 9, 2021. We may voluntarily prepay, in whole or in part, the Term Loan B without premium or penalty but with accrued interest. Repayment as part of a repricing transaction prior to October 9, 2014 would be subject to a 1.0 percent fee. Although the Credit Agreement does not contain financial covenants, the Credit Agreement contains other covenants that restrict the ability of Libbey Glass and the Guarantors to, among other things:

incur, assume or guarantee additional indebtedness;
pay dividends, make certain investments or other restricted payments;
create liens;
enter into affiliate transactions;
merge or consolidate, or otherwise dispose of all or substantially all the assets of Libbey Glass and the Guarantors; and
transfer or sell assets.

The Credit Agreement provides for customary events of default. In the case of an event of default as defined in the Credit Agreement, all of the outstanding Term Loan B will become due and payable immediately without further action or notice.

The Term Loan B and the related guarantees under the Credit Agreement are secured by (i) first priority liens on the Term Priority Collateral and (ii) second priority liens on the ABL Collateral.

We had an Interest Rate Agreement in place through May 9, 2014 with respect to $45.0 million of our Senior Secured Notes as a means to manage our fixed to variable interest rate ratio. The Interest Rate Agreement effectively converted this portion of our long-term borrowings from fixed rate debt to variable rate debt. The variable interest rate for our borrowings related to the Interest Rate Agreement at May 9, 2014, excluding applicable fees, was 5.5 percent. Total remaining Senior Secured Notes not covered by the Interest Rate Agreement had a fixed interest rate of 6.875 percent per year. We settled the swap at fair value, resulting in a payment of $1.1 million on May 13, 2014. Upon the redemption of the Senior Secured Notes, the unamortized balance of $0.8 million of the carrying value adjustment on debt related to the Interest Rate Agreement was recognized as expense in the loss on redemption of debt on the Condensed Consolidated Statements of Operations.

The fair market value and related carrying value adjustment are as follows:
(dollars in thousands)
June 30, 2014
 
December 31, 2013
Fair market value of Rate Agreement - asset (liability)
$

 
$
(2,073
)
Adjustment to increase (decrease) carrying value of the related long-term debt
$

 
$
(1,324
)

The fair value of the Interest Rate Agreement was based on the market standard methodology of netting the discounted expected future fixed cash receipts and the discounted future variable cash payments. The variable cash payments were based on an expectation of future interest rates derived from observed market interest rate forward curves. See note 9 for further discussion and the net impact recorded on the Condensed Consolidated Statements of Operations.

Promissory Note

In September 2001, we issued a $2.7 million promissory note at an interest rate of 6.0 percent in connection with the purchase of our Laredo, Texas warehouse facility. At June 30, 2014, we had $0.6 million outstanding on the promissory note. Principal and interest with respect to the promissory note are paid monthly.

Notes Payable

We have an overdraft line of credit for a maximum of €1.0 million. At June 30, 2014, there were no borrowings under the facility, which has an interest rate of 5.80 percent. Interest with respect to the note is paid monthly.

RMB Working Capital Loan

On September 2, 2013, Libbey China entered into a RMB 31.5 million (approximately $5.1 million) working capital loan with China Construction Bank (CCB) to cover seasonal working capital needs. The 364-day loan matures on September 1, 2014, and bears interest at a variable rate as announced by the People's Bank of China. The annual interest rate was 6.3 percent at June 30, 2014, and interest is paid monthly. The obligation is secured by a mortgage lien on the Libbey China facility.

AICEP Loan

In July 2012, Libbey Portugal entered into a loan agreement with Agencia para Investmento Comercio Externo de Portugal, EPE (AICEP), the Portuguese Agency for investment and external trade. The amount of the loan is €3.2 million (approximately $4.3 million) at June 30, 2014, and has an interest rate of 0.0 percent. Semi-annual installments of principal are due beginning in January 2016 through the maturity date in July 2018.

Fair Value of Borrowings

The fair value of our debt has been calculated based on quoted market prices (Level 2 in the fair value hierarchy) for the same or similar issues. The $440.0 million Term Loan B had an estimated fair value of $438.9 million at June 30, 2014. At December 31, 2013, the Senior Secured Notes had an estimated fair value of $437.4 million. The fair value of the remainder of our debt approximates carrying value at June 30, 2014 and December 31, 2013 due to variable rates.

Capital Resources and Liquidity

Historically, cash flows generated from operations, cash on hand and our borrowing capacity under our ABL Facility have enabled us to meet our cash requirements, including capital expenditures and working capital requirements. At June 30, 2014, we had $7.0 million borrowings under our ABL Facility and $6.8 million in letters of credit issued under that facility. As a result, we had $79.7 million of unused availability remaining under the ABL Facility at June 30, 2014. In addition, at June 30, 2014, we had $23.2 million of cash on hand.

Based on our operating plans and current forecast expectations, we anticipate that our level of cash on hand, cash flows from operations and borrowing capacity under our ABL Facility will provide sufficient cash availability to meet our ongoing liquidity needs.
Restructuring Charges
Restructuring Charges
Restructuring Charges

Capacity Realignment

In February 2013, we announced plans to discontinue production of certain glassware in North America and reduce manufacturing capacity at our Shreveport, Louisiana, manufacturing facility. As a result, on May 30, 2013, we ceased production of certain glassware in North America, discontinued the use of a furnace at our Shreveport, Louisiana, manufacturing plant and began relocating a portion of the production from the idled furnace to our Toledo, Ohio, and Monterrey, Mexico, locations. In connection with this plan, we incurred pretax charges of approximately $7.5 million. For the three months ended June 30, 2013, we recorded a pretax charge of $1.0 million. For the six months ended June 30, 2014 and 2013, we recorded a pretax charge of $1.0 million and $5.9 million, respectively. These charges included employee termination costs, fixed asset impairment charges, depreciation expense and other restructuring expenses. Employee termination costs include severance, medical benefits and outplacement services for the terminated employees. The write-down of fixed assets was to adjust certain machinery and equipment to the estimated fair market value. These activities are all within the Americas segment and were completed by March 31, 2014.

The following table summarizes the pretax charges incurred in 2014 and 2013:
 
Three months ended June 30,
 
Six months ended June 30,
 
Total
Charges
to Date
(dollars in thousands)
2014
 
2013
 
2014
 
2013
 
Accelerated depreciation & other
$

 
$
1,133

 
$

 
$
1,699

 
$
1,685

Other restructuring expenses

 

 
985

 

 
985

Included in cost of sales

 
1,133

 
985

 
1,699

 
2,670

 
 
 
 
 
 
 
 
 
 
Employee termination cost & other

 
(412
)
 

 
1,910

 
1,794

Fixed asset write-down

 

 

 
1,992

 
1,924

Other restructuring expenses

 
327

 

 
327

 
1,141

Included in special charges

 
(85
)
 

 
4,229

 
4,859

Total pretax charge
$

 
$
1,048

 
$
985

 
$
5,928

 
$
7,529


The following is the capacity realignment reserve activity for the six months ended June 30, 2014:
(dollars in thousands)
Reserve
Balance at
January 1, 2014
 
Total
Charge to Earnings
 
Cash
(payments) receipts
 
Non-cash Utilization
 
Reserve
Balance at
June 30, 2014
Employee termination cost & other
$
289

 
$

 
$
(289
)
 
$

 
$

Other restructuring expenses

 
985

 
(985
)
 

 

Total
$
289

 
$
985

 
$
(1,274
)
 
$

 
$

Income Taxes
Income Taxes
Income Taxes

Our effective tax rate was (4.3) percent for the six months ended June 30, 2014, compared to 27.8 percent for the six months ended June 30, 2013. Our effective tax rate differs from the United States statutory tax rate primarily due to valuation allowances, earnings in countries with differing statutory tax rates, accruals related to uncertain tax positions, intraperiod tax allocation, and tax planning structures. At June 30, 2014 and December 31, 2013, we had $0.8 million and $1.3 million, respectively, of gross unrecognized tax benefits, exclusive of interest and penalties. Tax benefits, exclusive of interest and penalties, of $0.1 million and $0.6 million were recorded in our income tax provision for the three months and the six months ended June 30, 2014, respectively, due to expirations of statutes of limitations. During the three months and the six months ended June 30, 2013, we recorded tax benefits, exclusive of interest and penalties, of zero and $0.5 million, respectively.

FASB ASC 740-20, "Income Taxes - Intraperiod Tax Allocation," requires that the provision for income taxes be allocated between continuing operations and other categories of earnings (such as discontinued operations or other comprehensive income) for each tax jurisdiction. For periods in which there is a year-to-date pre-tax loss from continuing operations and pre-tax income in other categories of earnings, the tax provision is first allocated to the other categories of earnings. A related tax benefit is then recorded in continuing operations. Tax benefits of $1.0 million and $1.6 million were recorded in our income tax provision for the three months and six months ended June 30, 2014, respectively. There were no similar benefits recorded for the three months and six months ended June 30, 2013.

Our current and future provision for income taxes for 2014 is impacted by valuation allowances. In the United States, the Netherlands and Portugal, we have recorded valuation allowances against our deferred income tax assets. We review the need for valuation allowances on a quarterly basis, or more frequently if events indicate that a review is required, 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. Despite our 2013 improvement in financial results in the U.S., management concluded that in consideration of our loss on redemption of debt in the second quarter of 2014, the duration and magnitude of our U.S. operating losses, the current U.S. economic environment and competitive landscape, it is our judgment that we have not yet achieved profitability of a duration and magnitude sufficient to release our valuation allowance against our deferred tax assets. Accordingly, we continue to maintain a valuation allowance related to our net deferred tax assets in the U.S. Additionally, we continue to maintain a valuation allowance in certain foreign jurisdictions due to continued operating losses, competitive landscape, and other market forces. We will continue to monitor and assess the need for a valuation allowance in all our jurisdictions in the upcoming quarters.

Income tax payments consisted of the following:
 
Three months ended June 30,
 
Six months ended June 30,
(dollars in thousands)
2014
 
2013
 
2014
 
2013
Total income tax payments, net of refunds
$
2,425

 
$
7,270

 
$
5,153

 
$
9,539

Less: credits or offsets
948

 
1,339

 
1,860

 
1,724

Cash paid, net
$
1,477

 
$
5,931

 
$
3,293

 
$
7,815

Pension and Non-pension Postretirement Benefits
Pension and Non-pension Postretirement Benefits
Pension 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. Our policy is to fund pension plans such that sufficient assets will be available to meet future benefit requirements. 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 subsidiaries in the Netherlands and Mexico. The plan in Mexico is primarily unfunded.

The components of our net pension expense, including the SERP, are as follows:
Three months ended June 30,
U.S. Plans
 
Non-U.S. Plans
 
Total
(dollars in thousands)
2014
 
2013
 
2014
 
2013
 
2014
 
2013
Service cost
$
807

 
$
1,092

 
$
579

 
$
686

 
$
1,386

 
$
1,778

Interest cost
3,819

 
3,501

 
1,422

 
1,195

 
5,241

 
4,696

Expected return on plan assets
(5,585
)
 
(5,605
)
 
(624
)
 
(496
)
 
(6,209
)
 
(6,101
)
Amortization of unrecognized:
 
 
 
 
 
 
 
 
 
 
 
Prior service cost
264

 
293

 
58

 
60

 
322

 
353

Loss
787

 
2,263

 
259

 
215

 
1,046

 
2,478

Settlement charge

 
715

 

 

 

 
715

Pension expense
$
92

 
$
2,259

 
$
1,694

 
$
1,660

 
$
1,786

 
$
3,919

 
 
 
 
 
 
 
 
 
 
 
 
Six months ended June 30,
U.S. Plans
 
Non-U.S. Plans
 
Total
(dollars in thousands)
2014
 
2013
 
2014
 
2013
 
2014
 
2013
Service cost
$
1,832

 
$
2,370

 
$
1,157

 
$
1,408

 
$
2,989

 
$
3,778

Interest cost
7,689

 
6,982

 
2,846

 
2,451

 
10,535

 
9,433

Expected return on plan assets
(11,193
)
 
(11,204
)
 
(1,256
)
 
(977
)
 
(12,449
)
 
(12,181
)
Amortization of unrecognized:
 
 
 
 
 
 
 
 
 
 
 
Prior service cost
529

 
586

 
115

 
122

 
644

 
708

Loss
2,029

 
4,350

 
517

 
453

 
2,546

 
4,803

Settlement charge

 
715

 

 

 

 
715

Pension expense
$
886

 
$
3,799

 
$
3,379

 
$
3,457

 
$
4,265

 
$
7,256

 
 
 
 
 
 
 
 
 
 
 
 


During the second quarter 2013 we incurred pension settlement charges totaling $0.7 million. The pension settlement charges were triggered by excess lump sum distributions, which required us to record unrecognized gains and losses in our pension plan accounts. We have contributed $0.8 million and $1.9 million of cash into our pension plans for the three and six months ended June 30, 2014, respectively. Pension contributions for the remainder of 2014 are estimated to be $4.4 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. Effective January 1, 2013, we ended our existing healthcare benefit for salaried retirees age 65 and older and instead provide a Retiree Health Reimbursement Arrangement (RHRA) that supports retirees in purchasing a Medicare plan that meets their needs. Also effective January 1, 2013, we reduced the maximum life insurance benefit for salaried retirees to $10,000. 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 June 30,
U.S. Plans
 
Non-U.S. Plans
 
Total
(dollars in thousands)
2014
 
2013
 
2014
 
2013
 
2014
 
2013
Service cost
$
251

 
$
203

 
$
1

 
$
1

 
$
252

 
$
204

Interest cost
710

 
610

 
29

 
31

 
739

 
641

Amortization of unrecognized:
 
 
 
 
 
 
 
 
 
 
 
Prior service cost
35

 
36

 

 

 
35

 
36

Loss / (gain)
67

 
138

 

 
1

 
67

 
139

Non-pension postretirement benefit expense
$
1,063

 
$
987

 
$
30

 
$
33

 
$
1,093

 
$
1,020

 
 
 
 
 
 
 
 
 
 
 
 
Six months ended June 30,
U.S. Plans
 
Non-U.S. Plans
 
Total
(dollars in thousands)
2014
 
2013
 
2014
 
2013
 
2014
 
2013
Service cost
$
503

 
$
595

 
$
1

 
$
1

 
$
504

 
$
596

Interest cost
1,420

 
1,311

 
56

 
54

 
1,476

 
1,365

Amortization of unrecognized:
 
 
 
 
 
 
 
 
 
 
 
Prior service cost
70

 
70

 

 

 
70

 
70

Loss / (gain)
134

 
429

 

 

 
134

 
429

Non-pension postretirement benefit expense
$
2,127

 
$
2,405

 
$
57

 
$
55

 
$
2,184

 
$
2,460

 
 
 
 
 
 
 
 
 
 
 
 


Our 2014 estimate of non-pension cash payments is $4.8 million, and we have paid $1.0 million and $2.1 million for the three and six months ended June 30, 2014, respectively.
Net Income (Loss) per Share of Common Stock
Net Income per Share of Common Stock
Net Income (Loss) per Share of Common Stock

The following table sets forth the computation of basic and diluted earnings (loss) per share:
 
Three months ended June 30,
 
Six months ended June 30,
(dollars in thousands, except earnings per share)
2014
 
2013
 
2014
 
2013
Numerators for earnings per share:
 
 
 
 
 
 
 
Net income (loss) that is available to common shareholders
$
(25,168
)
 
$
12,436

 
$
(28,552
)
 
$
14,425

 
 
 
 
 
 
 
 
Denominator for basic earnings per share:
 
 
 
 
 
 
 
Weighted average shares outstanding
21,672,844

 
21,288,897

 
21,600,125

 
21,202,411

 
 
 
 
 
 
 
 
Denominator for diluted earnings per share:
 
 
 
 
 
 
 
Effect of stock options and restricted stock units

 
654,388

 

 
504,622

Adjusted weighted average shares and assumed conversions
21,672,844

 
21,943,285

 
21,600,125

 
21,707,033

 
 
 
 
 
 
 
 
Basic earnings (loss) per share
$
(1.16
)
 
$
0.58

 
$
(1.32
)
 
$
0.68

 
 
 
 
 
 
 
 
Diluted earnings (loss) per share
$
(1.16
)
 
$
0.57

 
$
(1.32
)
 
$
0.66

 
 
 
 
 
 
 
 
Shares excluded from diluted earnings (loss) per share due to:
 
 
 
 
 
 
 
Net loss position (excluded from denominator)
490,706

 

 
465,577

 

Inclusion would have been anti-dilutive (excluded from calculation)
182,850

 
319,288

 
130,165

 
370,936



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
Derivatives
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. Most of these derivatives, except for the foreign currency contracts and a portion of our former interest rate swap, 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 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 were 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)
 
June 30, 2014
 
December 31, 2013
Derivatives designated as hedging
instruments under FASB ASC 815:
 
Balance Sheet Location
 
Fair Value
 
Balance Sheet Location
 
Fair Value
Natural gas contracts
 
Prepaid and other current assets
 
$
182

 
Prepaid and other current assets
 
$
394

Natural gas contracts
 
Other assets
 

 
Other assets
 
19

Total designated
 
 
 
182

 
 
 
413

Total
 
 
 
$
182

 
 
 
$
413

 
 
 
 
 
 
 
 
 
 
 
Liability Derivatives:
(dollars in thousands)
 
June 30, 2014
 
December 31, 2013
Derivatives designated as hedging
instruments under FASB ASC 815:
 
Balance Sheet Location
 
Fair Value
 
Balance Sheet Location
 
Fair Value
Natural gas contracts
 
Other long-term liabilities
 
$
76

 
Other long-term liabilities
 
$

Interest rate contract
 
Other long-term liabilities
 

 
Other long-term liabilities
 
1,866

Total designated
 
 
 
76

 
 
 
1,866

Derivatives not designated as hedging
instruments under FASB ASC 815:
 
 
 
 
 
 
 
 
Currency contracts
 
Accrued Liabilities
 
187

 
Accrued Liabilities
 

Interest rate contract
 
Other long-term liabilities
 

 
Other long-term liabilities
 
207

Total undesignated
 
 
 
187

 
 
 
207

Total
 
 
 
$
263

 
 
 
$
2,073



Interest Rate Swaps as Fair Value Hedges

In 2012, we entered into an interest rate swap agreement (Rate Agreement) with a notional amount of $45.0 million that was to mature in 2020. The Rate Agreement was executed in order to convert a portion of the fixed rate debt under the Senior Secured Notes into floating rate debt and maintain a capital structure containing fixed and floating rate debt. Upon the refinancing of the Senior Secured Notes, the Rate Agreement was called at fair value on May 9, 2014, resulting in a subsequent payment of $1.1 million. The remaining balance of the carrying value adjustment on debt related to the Rate Agreement was recognized as a loss in the loss on redemption of debt on the Condensed Consolidated Statements of Operations. See note 4 for further discussion.

Prior to the refinancing of the Senior Secured Notes, $40.5 million of our Rate Agreement was designated and qualified as a fair value hedge. The change in the fair value of the derivative instrument related to the future cash flows (gain or loss on the derivative) and the offsetting change in the fair value of the hedged long-term debt attributable to the hedged risk were recognized in current earnings. We included the gain or loss on the hedged long-term debt, along with the offsetting loss or gain on the related interest rate swap, in other income (expense) on the Condensed Consolidated Statements of Operations.

As of July 1, 2013, we de-designated 10 percent, or $4.5 million, of our Rate Agreement. As a result, the mark-to-market of the $4.5 million portion of the Rate Agreement is recorded in other income (expense) on the Condensed Consolidated Statements of Operations.

The following table provides a summary of the gain (loss) recognized on the Condensed Consolidated Statements of Operations from the de-designated portion of our Rate Agreement:
 
 
Three months ended June 30,
 
Six months ended June 30,
(dollars in thousands)
 
2014
 
2013
 
2014
 
2013
Interest rate swap
 
$
40

 
$

 
$
140

 
$

Related long-term debt
 
(589
)
 

 
(589
)
 

Net impact
 
$
(549
)
 
$

 
$
(449
)
 
$


The following table provides a summary of the gain (loss) recognized on the Condensed Consolidated Statements of Operations from the designated portion of our Rate Agreement:
 
 
Three months ended June 30,
 
Six months ended June 30,
(dollars in thousands)
 
2014
 
2013
 
2014
 
2013
Interest rate swap
 
$
168

 
$
(1,723
)
 
$
497

 
$
(2,079
)
Related long-term debt
 
(376
)
 
1,376

 
(735
)
 
1,510

Net impact
 
$
(208
)
 
$
(347
)
 
$
(238
)
 
$
(569
)

The gain or loss on the hedged long-term debt netted with the offsetting gain or loss on the related designated and de-designated interest rate swap was recorded on the Condensed Consolidated Statements of Operations as follows:
 
 
Three months ended June 30,
 
Six months ended June 30,
(dollars in thousands)
 
2014
 
2013
 
2014
 
2013
Loss on redemption of debt
 
$
(757
)
 
$

 
$
(757
)
 
$

Other income (expense)
 

 
(347
)
 
70

 
(569
)
Net impact
 
$
(757
)
 
$
(347
)
 
$
(687
)
 
$
(569
)


Commodity Futures Contracts Designated as Cash Flow Hedges

We use commodity futures contracts related to forecasted future North American natural gas requirements. The objective of these futures 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 June 30, 2014, we had commodity contracts for 3,020,000 million British Thermal Units (BTUs) of natural gas. At December 31, 2013, we had commodity contracts for 1,520,000 million BTUs of natural gas.

All of our natural gas derivatives qualify and are designated as cash flow hedges at June 30, 2014. 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 current earnings. 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 Statements of Operations. We recognized in the three and six months ended June 30, 2013 $(0.3) million of ineffectiveness in other income (expense) in the Condensed Consolidated Statements of Operations for certain contracts at our Mexico facility. This ineffectiveness was related to a change in pricing caused by the Mexican government instituting a fixed surcharge. The ineffectiveness is not expected to continue so we have continued to consider the contracts effective as appropriate under FASB ASC 815 "Derivatives and Hedging." We paid (received) additional cash of $(0.3) million and $(0.3) million in the three months ended June 30, 2014 and 2013, respectively, and $(0.8) million and a nil amount in the six months ended June 30, 2014 and 2013, respectively, 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 gains currently carried in accumulated other comprehensive loss that will be reclassified into earnings over the next twelve months will result in $0.2 million of income 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):
 
 
Three months ended June 30,
 
Six months ended June 30,
(dollars in thousands)
 
2014
 
2013
 
2014
 
2013
Derivatives in Cash Flow Hedging relationships:
 
 
 
 
 
 
 
 
Natural gas contracts
 
$
(124
)
 
$
(377
)
 
$
506

 
$
590

Total
 
$
(124
)
 
$
(377
)
 
$
506

 
$
590



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:
 
 
 
Three months ended June 30,
 
Six months ended June 30,
(dollars in thousands)
 
 
2014
 
2013
 
2014
 
2013
Derivative:
Location:
 
 
 
 
 
 
 
 
Natural gas contracts
Cost of sales
 
$
349

 
$
252

 
$
814

 
$
6

Total impact on net income (loss)
 
 
$
349

 
$
252

 
$
814

 
$
6



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. We enter into a series of foreign currency contracts to sell Canadian dollars. At June 30, 2014, we had C$7.7 million in foreign currency contracts. At December 31, 2013, we had no active foreign currency contracts. 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 derivatives that were not designated as hedging instruments are recorded in current earnings as follows:
 
 
 
Three months ended June 30,
 
Six months ended June 30,
(dollars in thousands)
 
 
2014
 
2013
 
2014
 
2013
Derivative:
Location:
 
 

 
 

 
 

 
 

Currency contracts
Other income (expense)
 
$
(187
)
 
$
166

 
$
(187
)
 
$
417

Total
 
 
$
(187
)
 
$
166

 
$
(187
)
 
$
417



We do not believe we are exposed to more than a nominal amount of credit risk in our natural gas hedges and currency contracts as the counterparties are established financial institutions. The counterparties for the derivative agreements are rated BBB+ or better as of June 30, 2014, by Standard and Poor’s.
Comprehensive Income (Loss)
Comprehensive Income (Loss)
Comprehensive Income (Loss)

Accumulated other comprehensive loss, net of tax, is as follows:
Three months ended June 30, 2014
(dollars in thousands)
 
Foreign Currency Translation
 
Derivative Instruments
 
Pension and Other Postretirement Benefits
 
Total
Accumulated
Comprehensive Loss
Balance on March 31, 2014
 
$
3,966

 
$
1,359

 
$
(77,586
)
 
$
(72,261
)
 
 
 
 
 
 
 
 
 
Other comprehensive income (loss)
 
(785
)
 
(124
)
 
1,292

 
383

Currency impact
 

 

 
297

 
297

 
 
 
 
 
 
 
 
 
Amounts reclassified from accumulated other comprehensive income (loss):
 
 
 
 
 
 
 
 
    Amortization of actuarial loss (1)
 

 

 
1,113

 
1,113

    Amortization of prior service cost (1)
 

 

 
357

 
357

    Cost of sales
 

 
(349
)
 

 
(349
)
Current-period other comprehensive income (loss)
 
(785
)
 
(473
)
 
3,059

 
1,801

Tax effect
 

 
61

 
(975
)
 
(914
)
Balance on June 30, 2014
 
$
3,181

 
$
947

 
$
(75,502
)
 
$
(71,374
)
 
 
 
 
 
 
 
 
 
Six months ended June 30, 2014
(dollars in thousands)
 
Foreign Currency Translation
 
Derivative Instruments
 
Pension and Other Postretirement Benefits
 
Total
Accumulated
Comprehensive Loss
Balance on December 31, 2013
 
$
4,554

 
$
1,221

 
$
(78,935
)
 
$
(73,160
)
 
 
 
 
 
 
 
 
 
Other comprehensive income (loss)
 
(1,373
)
 
506

 
1,292

 
425

Currency impact
 

 

 
310

 
310

 
 
 
 
 
 
 
 
 
Amounts reclassified from accumulated other comprehensive income (loss):
 
 
 
 
 
 
 
 
    Amortization of actuarial loss (1)
 

 

 
2,680

 
2,680

    Amortization of prior service cost (1)
 

 

 
714

 
714

    Cost of sales
 

 
(814
)
 

 
(814
)
Current-period other comprehensive income (loss)
 
(1,373
)
 
(308
)
 
4,996

 
3,315

Tax effect
 

 
34

 
(1,563
)
 
(1,529
)
Balance on June 30, 2014
 
$
3,181

 
$
947

 
$
(75,502
)
 
$
(71,374
)



Three months ended June 30, 2013
(dollars in thousands)
 
Foreign Currency Translation
 
Derivative Instruments
 
Pension and Other Postretirement Benefits
 
Total
Accumulated
Comprehensive Loss
Balance on March 31, 2013
 
$
(4,566
)
 
$
1,534

 
$
(137,217
)
 
$
(140,249
)
 
 
 
 
 
 
 
 
 
Other comprehensive income (loss)
 
2,335

 
(377
)
 
3,059

 
5,017

Currency impact
 

 

 
307

 
307

 
 
 
 
 
 
 
 
 
Amounts reclassified from accumulated other comprehensive income (loss):
 
 
 
 
 
 
 
 
    Amortization of actuarial loss (1)
 

 

 
2,600

 
2,600

    Amortization of prior service cost (1)
 

 

 
390

 
390

    Cost of sales
 

 
(252
)
 

 
(252
)
Current-period other comprehensive income (loss)
 
2,335

 
(629
)
 
6,356

 
8,062

Tax effect
 

 
120

 
56

 
176

Balance on June 30, 2013
 
$
(2,231
)
 
$
1,025

 
$
(130,805
)
 
$
(132,011
)
 
 
 
 
 
 
 
 
 
Six months ended June 30, 2013
(dollars in thousands)
 
Foreign Currency Translation
 
Derivative Instruments
 
Pension and Other Postretirement Benefits
 
Total
Accumulated
Comprehensive Loss
Balance on December 31, 2012
 
$
(1,641
)
 
$
489

 
$
(139,888
)
 
$
(141,040
)
 
 
 
 
 
 
 
 
 
Other comprehensive income (loss)
 
(590
)
 
590

 
3,059

 
3,059

Currency impact
 

 

 
(45
)
 
(45
)
 
 
 
 
 
 
 
 
 
Amounts reclassified from accumulated other comprehensive income (loss):
 
 
 
 
 
 
 
 
    Amortization of actuarial loss (1)
 

 

 
5,200

 
5,200

    Amortization of prior service cost (1)
 

 

 
780

 
780

    Cost of sales
 

 
(6
)
 

 
(6
)
Current-period other comprehensive income (loss)
 
(590
)
 
584

 
8,994

 
8,988

Tax effect
 

 
(48
)
 
89

 
41

Balance on June 30, 2013
 
$
(2,231
)
 
$
1,025

 
$
(130,805
)
 
$
(132,011
)
___________________________
(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
Segments
Segments

Our reporting segments align with our regionally focused organizational structure, which we believe enables us to better serve customers across the globe. Under this structure, we report financial results for the Americas; Europe, the Middle East and Africa (EMEA); U.S. Sourcing; and Other. In addition, sales and segment EBIT reflect end market reporting pursuant to which sales and related costs are included in segment EBIT based on the geographical destination of the sale. 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.

Americas—includes worldwide sales of manufactured and sourced glass tableware having an end market destination in North and South America.

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

U.S. Sourcing—includes U.S. sales of sourced ceramic dinnerware, metal tableware, hollowware, and serveware.

Other —includes 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 June 30,
 
Six months ended June 30,
(dollars in thousands)
2014
 
2013
 
2014
 
2013
Net Sales:
 
 
 
 
 
 
 
Americas
$
154,450

 
$
141,815

 
$
276,375

 
$
265,350

EMEA
39,331

 
37,981

 
73,729

 
72,223

U.S. Sourcing
21,396

 
21,196

 
39,130

 
38,680

Other
8,359

 
8,912

 
15,883

 
17,127

Consolidated
$
223,536

 
$
209,904

 
$
405,117

 
$
393,380

 
 
 
 
 
 
 
 
Segment EBIT:
 
 
 
 
 
 
 
Americas
$
32,986

 
$
33,123

 
$
47,975

 
$
51,925

EMEA
1,910

 
691

 
2,163

 
(671
)
U.S. Sourcing
2,301

 
3,578

 
3,169

 
5,119

Other
869

 
829

 
1,314

 
3,114

Total Segment EBIT
$
38,066

 
$
38,221

 
$
54,621

 
$
59,487

 
 
 
 
 
 
 
 
Reconciliation of Segment EBIT to Net Income (Loss):
 
 
 
 
 
 
 
Segment EBIT
$
38,066

 
$
38,221

 
$
54,621

 
$
59,487

Retained corporate costs
(7,627
)
 
(6,714
)
 
(14,752
)
 
(12,014
)
Loss on redemption of debt (note 4)
(47,191
)
 
(2,518
)
 
(47,191
)
 
(2,518
)
Pension settlement (note 7)

 
(715
)
 

 
(715
)
Furnace malfunction
(576
)
 

 
(5,882
)
 

Restructuring charges (note 5)

 
(1,048
)
 
(985
)
 
(5,928
)
Abandoned property (note 14)

 
(1,781
)
 

 
(1,781
)
Interest expense
(5,486
)
 
(8,126
)
 
(13,187
)
 
(16,561
)
Income taxes
(2,354
)
 
(4,883
)
 
(1,176
)
 
(5,545
)
Net income (loss)
$
(25,168
)
 
$
12,436

 
$
(28,552
)
 
$
14,425

 
 
 
 
 
 
 
 
Depreciation & Amortization:
 
 
 
 
 
 
 
Americas
$
5,851

 
$
7,321

 
$
11,810

 
$
13,849

EMEA
2,738

 
2,507

 
5,364

 
4,993

U.S. Sourcing
7

 
9

 
14

 
18

Other
1,628

 
1,398

 
3,272

 
2,772

Corporate
368

 
388

 
808

 
765

Consolidated
$
10,592

 
$
11,623

 
$
21,268

 
$
22,397

 
 
 
 
 
 
 
 
Capital Expenditures:
 
 
 
 
 
 
 
Americas
$
9,663

 
$
7,034

 
$
16,795

 
$
13,909

EMEA
1,717

 
1,745

 
3,278

 
3,041

U.S. Sourcing

 
32

 

 
32

Other
320

 
1,288

 
892

 
1,623

Corporate
234

 
790

 
870

 
1,166

Consolidated
$
11,934

 
$
10,889

 
$
21,835

 
$
19,771

Fair Value
Fair Value
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)
June 30, 2014
 
December 31, 2013
Level 1
 
Level 2
 
Level 3
 
Total
 
Level 1
 
Level 2
 
Level 3
 
Total
Commodity futures natural gas contracts
$

 
$
106

 
$

 
$
106

 
$

 
$
413

 
$

 
$
413

Currency contracts

 
(187
)
 

 
(187
)
 

 

 

 

Interest rate agreement

 

 

 

 

 
(2,073
)
 

 
(2,073
)
Net derivative asset (liability)
$

 
$
(81
)
 
$

 
$
(81
)
 
$

 
$
(1,660
)
 
$

 
$
(1,660
)


The fair values of our commodity futures natural gas contracts and currency contracts are determined using observable market inputs. On May 9, 2014, the interest rate agreement was terminated. The fair value of our interest rate agreement was based on the market standard methodology of netting the discounted expected future fixed cash receipts and the discounted future variable cash payments. The variable cash payments were 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 agreements 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)
 
June 30, 2014
 
December 31, 2013
Prepaid and other current assets
 
$
182

 
$
394

Other assets
 

 
19

Accrued liabilities
 
(187
)
 

Other long-term liabilities
 
(76
)
 
(2,073
)
Net derivative asset (liability)
 
$
(81
)
 
$
(1,660
)


Other Income (Expense)
Other Income (Expense)
Other Income (Expense)

Items included in other income (expense) in the Condensed Consolidated Statements of Operations are as follows:
 
Three months ended June 30,
 
Six months ended June 30,
(dollars in thousands)
2014
 
2013
 
2014
 
2013
Gain (loss) on currency translation
$
(356
)
 
$
481

 
$
(631
)
 
$
198

Hedge ineffectiveness

 
(623
)
 
70

 
(845
)
Other non-operating income (expense)
678

 
193

 
561

 
263

Other income (expense)
$
322

 
$
51

 
$

 
$
(384
)


Contingencies
Contingencies
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 clean-up of the Lower Ley Creek sub-site.

U.S. EPA has completed its Remedial Investigation (RI) and recently issued a Feasibility Study (FS), Risk Assessment (RA) and Proposed Remedial Action Plan (PRAP) with respect to the Lower Ley Creek sub-site, with the proposed remedy consisting of dredging and disposal of dredge soils to a landfill. The PRAP is subject to a 30-day comment period. The costs of the proposed plan of remediation are not yet known. Additionally, it is not yet known whether amounts previously recovered by U.S. EPA are adequate to cover the costs associated with any such plan of remediation, nor is it known how any excess costs may be allocated among the PRPs.

It is reasonably possible that Syracuse China may be required to record a liability related to remediation costs at the Ley Creek sub-site. As of June 30, 2014, the possible loss or range of loss is not reasonably estimable. To the extent that Syracuse China may have liability with respect to this sub-site and to the extent that 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. Although we cannot predict the ultimate outcome of this proceeding, we believe that it will not have a material impact on our financial condition, results of operations or liquidity.

Insurance claim

We currently have an open insurance claim related to a 2013 furnace malfunction at our manufacturing facility in Toledo, Ohio. At December 31, 2013, partial insurance proceeds of $5.0 million were recognized in accounts receivable. Cash was received in the first quarter of 2014, with $4.3 million recorded as an investing activity and $0.7 million recorded as cash from operations on the Condensed Consolidated Statements of Cash Flows. The insurance claim is still ongoing and the amount of any future recovery is uncertain at this time.

Abandoned Property Audit

We have completed an unclaimed property audit. The property subject to review in this audit process generally included unclaimed wages, vendor payments and customer refunds. State escheat laws generally require entities to report and remit abandoned and unclaimed property. Failure to timely report and remit the property can result in assessments that include interest and penalties, in addition to the payment of the escheat liability itself. At the completion of the audit in the three months ended June 30, 2013, we paid $4.5 million, which resulted in additional expense of $1.8 million in selling, general and administrative expenses on the Condensed Consolidated Statement of Operations. Expense of $2.7 million was recorded in the third quarter of 2011.
Significant Accounting Policies (Policies)
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 31st. 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 jurisdiction in which we conduct our operations or otherwise incur taxable income or losses. In the United States, Portugal and the Netherlands, we have recorded valuation allowances against our deferred income tax assets. See note 6 for further discussion.
FASB ASC 740-20, "Income Taxes - Intraperiod Tax Allocation," requires that the provision for income taxes be allocated between continuing operations and other categories of earnings (such as discontinued operations or other comprehensive income) for each tax jurisdiction. For periods in which there is a year-to-date pre-tax loss from continuing operations and pre-tax income in other categories of earnings, the tax provision is first allocated to the other categories of earnings. A related tax benefit is then recorded in continuing operations.
Our current and future provision for income taxes for 2014 is impacted by valuation allowances. In the United States, the Netherlands and Portugal, we have recorded valuation allowances against our deferred income tax assets. We review the need for valuation allowances on a quarterly basis, or more frequently if events indicate that a review is required, 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. Despite our 2013 improvement in financial results in the U.S., management concluded that in consideration of our loss on redemption of debt in the second quarter of 2014, the duration and magnitude of our U.S. operating losses, the current U.S. economic environment and competitive landscape, it is our judgment that we have not yet achieved profitability of a duration and magnitude sufficient to release our valuation allowance against our deferred tax assets. Accordingly, we continue to maintain a valuation allowance related to our net deferred tax assets in the U.S. Additionally, we continue to maintain a valuation allowance in certain foreign jurisdictions due to continued operating losses, competitive landscape, and other market forces. We will continue to monitor and assess the need for a valuation allowance in all our jurisdictions in the upcoming quarters.
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

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. We are currently assessing the impact that this standard will have on our condensed consolidated financial statements.

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. Our policy is to fund pension plans such that sufficient assets will be available to meet future benefit requirements. 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 subsidiaries in the Netherlands and Mexico. The plan in Mexico is primarily unfunded.
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. Effective January 1, 2013, we ended our existing healthcare benefit for salaried retirees age 65 and older and instead provide a Retiree Health Reimbursement Arrangement (RHRA) that supports retirees in purchasing a Medicare plan that meets their needs. Also effective January 1, 2013, we reduced the maximum life insurance benefit for salaried retirees to $10,000. 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.
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. Most of these derivatives, except for the foreign currency contracts and a portion of our former interest rate swap, 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 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 were accounted for under FASB ASC 815 “Derivatives and Hedging.”
Our reporting segments align with our regionally focused organizational structure, which we believe enables us to better serve customers across the globe. Under this structure, we report financial results for the Americas; Europe, the Middle East and Africa (EMEA); U.S. Sourcing; and Other. In addition, sales and segment EBIT reflect end market reporting pursuant to which sales and related costs are included in segment EBIT based on the geographical destination of the sale. 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.

Americas—includes worldwide sales of manufactured and sourced glass tableware having an end market destination in North and South America.

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

U.S. Sourcing—includes U.S. sales of sourced ceramic dinnerware, metal tableware, hollowware, and serveware.

Other —includes 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.
The fair values of our commodity futures natural gas contracts and currency contracts are determined using observable market inputs. On May 9, 2014, the interest rate agreement was terminated. The fair value of our interest rate agreement was based on the market standard methodology of netting the discounted expected future fixed cash receipts and the discounted future variable cash payments. The variable cash payments were 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 agreements and currency contracts are hedges of either recorded assets or liabilities or anticipated transactions.
Significant Accounting Policies (Tables)
Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Table Text Block]
Stock-based compensation expense charged to the Condensed Consolidated Statements of Operations is as follows:
 
 
Three months ended June 30,
 
Six months ended June 30,
(dollars in thousands)
 
2014
 
2013
 
2014
 
2013
Stock-based compensation expense
 
$
1,634

 
$
1,485

 
$
2,637

 
$
2,309


Balance Sheet Details (Tables)
Schedule of Other Assets and Other Liabilities [Table Text Block]
The following table provides detail of selected balance sheet items:
(dollars in thousands)
June 30, 2014
 
December 31, 2013
Accounts receivable:
 
 
 
Trade receivables
$
104,114

 
$
87,499

Other receivables (see note 14)
2,231

 
7,050

Total accounts receivable, less allowances of $6,234 and $5,846
$
106,345

 
$
94,549

 
 
 
 
Inventories:
 
 
 
Finished goods
$
163,247

 
$
144,945

Work in process
1,687

 
1,615

Raw materials
4,790

 
4,558

Repair parts
11,058

 
10,550

Operating supplies
1,318

 
1,453

Total inventories, less loss provisions of $4,577 and $4,913
$
182,100

 
$
163,121

 
 
 
 
Prepaid and other current assets:
 
 
 
Value added tax
$
13,254

 
$
6,697

Prepaid expenses
10,674

 
8,396

Deferred income taxes
5,840

 
5,840

Prepaid income taxes
4,970

 
3,511

Derivative asset
182

 
394

Total prepaid and other current assets
$
34,920

 
$
24,838

 
 
 
 
Other assets:
 
 
 
Deposits
$
1,092

 
$
919

Finance fees — net of amortization
7,484

 
10,472

Other assets
2,392

 
2,143

Total other assets
$
10,968

 
$
13,534

 
 
 
 
Accrued liabilities:
 
 
 
Accrued incentives
$
24,156

 
$
17,830

Workers compensation
6,873

 
7,108

Medical liabilities
3,109

 
3,433

Interest
3,871

 
3,331

Commissions payable
1,072

 
1,067

Withholdings and other non-income tax accruals
2,134

 
1,929

Other accrued liabilities
7,200

 
6,720

Total accrued liabilities
$
48,415

 
$
41,418

 
 
 
 
Other long-term liabilities:
 
 
 
Deferred liability
$
7,237

 
$
7,424

Derivative liability
76

 
2,073

Other long-term liabilities
4,426

 
4,277

Total other long-term liabilities
$
11,739

 
$
13,774

Borrowings (Tables)
Borrowings consist of the following:
(dollars in thousands)
Interest Rate
 
Maturity Date
June 30,
2014
 
December 31,
2013
Borrowings under ABL Facility
floating
 
April 9, 2019
$
7,000

 
$

Term Loan B
floating
 
April 9, 2021
440,000

 

Senior Secured Notes
6.875%
(1)
May 15, 2020

 
405,000

Promissory Note
6.00%
 
July, 2014 to September, 2016
566

 
681

RMB Working Capital Loan
floating
 
September, 2014
5,119

 
5,157

AICEP Loan
0.00%
 
January, 2016 to July 30, 2018
4,319

 
2,389

Total borrowings
 
 
 
457,004

 
413,227

Less — unamortized discount
 
 
 
1,064

 

Plus — carrying value adjustment on debt related to the Interest Rate Agreement (1)

 
(1,324
)
Total borrowings — net
 
 
 
455,940

 
411,903

Less — long term debt due within one year
 
 
9,761

 
5,391

Total long-term portion of borrowings — net
 
$
446,179

 
$
406,512

_____________________________
(1)
See Interest Rate Agreement under “Term Loan B and Senior Secured Notes” below and in note 9.
The fair market value and related carrying value adjustment are as follows:
(dollars in thousands)
June 30, 2014
 
December 31, 2013
Fair market value of Rate Agreement - asset (liability)
$

 
$
(2,073
)
Adjustment to increase (decrease) carrying value of the related long-term debt
$

 
$
(1,324
)

Restructuring Charges (Tables)
The following table summarizes the pretax charges incurred in 2014 and 2013:
 
Three months ended June 30,
 
Six months ended June 30,
 
Total
Charges
to Date
(dollars in thousands)
2014
 
2013
 
2014
 
2013
 
Accelerated depreciation & other
$

 
$
1,133

 
$

 
$
1,699

 
$
1,685

Other restructuring expenses

 

 
985

 

 
985

Included in cost of sales

 
1,133

 
985

 
1,699

 
2,670

 
 
 
 
 
 
 
 
 
 
Employee termination cost & other

 
(412
)
 

 
1,910

 
1,794

Fixed asset write-down

 

 

 
1,992

 
1,924

Other restructuring expenses

 
327

 

 
327

 
1,141

Included in special charges

 
(85
)
 

 
4,229

 
4,859

Total pretax charge
$

 
$
1,048

 
$
985

 
$
5,928

 
$
7,529


The following is the capacity realignment reserve activity for the six months ended June 30, 2014:
(dollars in thousands)
Reserve
Balance at
January 1, 2014
 
Total
Charge to Earnings
 
Cash
(payments) receipts
 
Non-cash Utilization
 
Reserve
Balance at
June 30, 2014
Employee termination cost & other
$
289

 
$

 
$
(289
)
 
$

 
$

Other restructuring expenses

 
985

 
(985
)
 

 

Total
$
289

 
$
985

 
$
(1,274
)
 
$

 
$

Income Taxes (Tables)
Schedule of Income Tax Payments [Table Text Block]
Income tax payments consisted of the following:
 
Three months ended June 30,
 
Six months ended June 30,
(dollars in thousands)
2014
 
2013
 
2014
 
2013
Total income tax payments, net of refunds
$
2,425

 
$
7,270

 
$
5,153

 
$
9,539

Less: credits or offsets
948

 
1,339

 
1,860

 
1,724

Cash paid, net
$
1,477

 
$
5,931

 
$
3,293

 
$
7,815



Pension and Non-pension Postretirement Benefits (Tables)
The components of our net pension expense, including the SERP, are as follows:
Three months ended June 30,
U.S. Plans
 
Non-U.S. Plans
 
Total
(dollars in thousands)
2014
 
2013
 
2014
 
2013
 
2014
 
2013
Service cost
$
807

 
$
1,092

 
$
579

 
$
686

 
$
1,386

 
$
1,778

Interest cost
3,819

 
3,501

 
1,422

 
1,195

 
5,241

 
4,696

Expected return on plan assets
(5,585
)
 
(5,605
)
 
(624
)
 
(496
)
 
(6,209
)
 
(6,101
)
Amortization of unrecognized:
 
 
 
 
 
 
 
 
 
 
 
Prior service cost
264

 
293

 
58

 
60

 
322

 
353

Loss
787

 
2,263

 
259

 
215

 
1,046

 
2,478

Settlement charge

 
715

 

 

 

 
715

Pension expense
$
92

 
$
2,259

 
$
1,694

 
$
1,660

 
$
1,786

 
$
3,919

 
 
 
 
 
 
 
 
 
 
 
 
Six months ended June 30,
U.S. Plans
 
Non-U.S. Plans
 
Total
(dollars in thousands)
2014
 
2013
 
2014
 
2013
 
2014
 
2013
Service cost
$
1,832

 
$
2,370

 
$
1,157

 
$
1,408

 
$
2,989

 
$
3,778

Interest cost
7,689

 
6,982

 
2,846

 
2,451

 
10,535

 
9,433

Expected return on plan assets
(11,193
)
 
(11,204
)
 
(1,256
)
 
(977
)
 
(12,449
)
 
(12,181
)
Amortization of unrecognized:
 
 
 
 
 
 
 
 
 
 
 
Prior service cost
529

 
586

 
115

 
122

 
644

 
708

Loss
2,029

 
4,350

 
517

 
453

 
2,546

 
4,803

Settlement charge

 
715

 

 

 

 
715

Pension expense
$
886

 
$
3,799

 
$
3,379

 
$
3,457

 
$
4,265

 
$
7,256

 
 
 
 
 
 
 
 
 
 
 
 
The provision for our non-pension postretirement benefit expense consists of the following:
Three months ended June 30,
U.S. Plans
 
Non-U.S. Plans
 
Total
(dollars in thousands)
2014
 
2013
 
2014
 
2013
 
2014
 
2013
Service cost
$
251

 
$
203

 
$
1

 
$
1

 
$
252

 
$
204

Interest cost
710

 
610

 
29

 
31

 
739

 
641

Amortization of unrecognized:
 
 
 
 
 
 
 
 
 
 
 
Prior service cost
35

 
36

 

 

 
35

 
36

Loss / (gain)
67

 
138

 

 
1

 
67

 
139

Non-pension postretirement benefit expense
$
1,063

 
$
987

 
$
30

 
$
33

 
$
1,093

 
$
1,020

 
 
 
 
 
 
 
 
 
 
 
 
Six months ended June 30,
U.S. Plans
 
Non-U.S. Plans
 
Total
(dollars in thousands)
2014
 
2013
 
2014
 
2013
 
2014
 
2013
Service cost
$
503

 
$
595

 
$
1

 
$
1

 
$
504

 
$
596

Interest cost
1,420

 
1,311

 
56

 
54

 
1,476

 
1,365

Amortization of unrecognized:
 
 
 
 
 
 
 
 
 
 
 
Prior service cost
70

 
70

 

 

 
70

 
70

Loss / (gain)
134

 
429

 

 

 
134

 
429

Non-pension postretirement benefit expense
$
2,127

 
$
2,405

 
$
57

 
$
55

 
$
2,184

 
$
2,460

 
 
 
 
 
 
 
 
 
 
 
 
Net Income (Loss) per Share of Common Stock (Tables)
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]
The following table sets forth the computation of basic and diluted earnings (loss) per share:
 
Three months ended June 30,
 
Six months ended June 30,
(dollars in thousands, except earnings per share)
2014
 
2013
 
2014
 
2013
Numerators for earnings per share:
 
 
 
 
 
 
 
Net income (loss) that is available to common shareholders
$
(25,168
)
 
$
12,436

 
$
(28,552
)
 
$
14,425

 
 
 
 
 
 
 
 
Denominator for basic earnings per share:
 
 
 
 
 
 
 
Weighted average shares outstanding
21,672,844

 
21,288,897

 
21,600,125

 
21,202,411

 
 
 
 
 
 
 
 
Denominator for diluted earnings per share:
 
 
 
 
 
 
 
Effect of stock options and restricted stock units

 
654,388

 

 
504,622

Adjusted weighted average shares and assumed conversions
21,672,844

 
21,943,285

 
21,600,125

 
21,707,033

 
 
 
 
 
 
 
 
Basic earnings (loss) per share
$
(1.16
)
 
$
0.58

 
$
(1.32
)
 
$
0.68

 
 
 
 
 
 
 
 
Diluted earnings (loss) per share
$
(1.16
)
 
$
0.57

 
$
(1.32
)
 
$
0.66

 
 
 
 
 
 
 
 
Shares excluded from diluted earnings (loss) per share due to:
 
 
 
 
 
 
 
Net loss position (excluded from denominator)
490,706

 

 
465,577

 

Inclusion would have been anti-dilutive (excluded from calculation)
182,850

 
319,288

 
130,165

 
370,936

Derivatives (Tables)
The following table provides the fair values of our derivative financial instruments for the periods presented:
 
 
Asset Derivatives:
(dollars in thousands)
 
June 30, 2014
 
December 31, 2013
Derivatives designated as hedging
instruments under FASB ASC 815:
 
Balance Sheet Location
 
Fair Value
 
Balance Sheet Location
 
Fair Value
Natural gas contracts
 
Prepaid and other current assets
 
$
182

 
Prepaid and other current assets
 
$
394

Natural gas contracts
 
Other assets
 

 
Other assets
 
19

Total designated
 
 
 
182

 
 
 
413

Total
 
 
 
$
182

 
 
 
$
413

 
 
 
 
 
 
 
 
 
 
 
Liability Derivatives:
(dollars in thousands)
 
June 30, 2014
 
December 31, 2013
Derivatives designated as hedging
instruments under FASB ASC 815:
 
Balance Sheet Location
 
Fair Value
 
Balance Sheet Location
 
Fair Value
Natural gas contracts
 
Other long-term liabilities
 
$
76

 
Other long-term liabilities
 
$

Interest rate contract
 
Other long-term liabilities
 

 
Other long-term liabilities
 
1,866

Total designated
 
 
 
76

 
 
 
1,866

Derivatives not designated as hedging
instruments under FASB ASC 815:
 
 
 
 
 
 
 
 
Currency contracts
 
Accrued Liabilities
 
187

 
Accrued Liabilities
 

Interest rate contract
 
Other long-term liabilities
 

 
Other long-term liabilities
 
207

Total undesignated
 
 
 
187

 
 
 
207

Total
 
 
 
$
263

 
 
 
$
2,073

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:
 
 
 
Three months ended June 30,
 
Six months ended June 30,
(dollars in thousands)
 
 
2014
 
2013
 
2014
 
2013
Derivative:
Location:
 
 
 
 
 
 
 
 
Natural gas contracts
Cost of sales
 
$
349

 
$
252

 
$
814

 
$
6

Total impact on net income (loss)
 
 
$
349

 
$
252

 
$
814

 
$
6

The following table provides a summary of the gain (loss) recognized on the Condensed Consolidated Statements of Operations from the de-designated portion of our Rate Agreement:
 
 
Three months ended June 30,
 
Six months ended June 30,
(dollars in thousands)
 
2014
 
2013
 
2014
 
2013
Interest rate swap
 
$
40

 
$

 
$
140

 
$

Related long-term debt
 
(589
)
 

 
(589
)
 

Net impact
 
$
(549
)
 
$

 
$
(449
)
 
$


The following table provides a summary of the gain (loss) recognized on the Condensed Consolidated Statements of Operations from the designated portion of our Rate Agreement:
 
 
Three months ended June 30,
 
Six months ended June 30,
(dollars in thousands)
 
2014
 
2013
 
2014
 
2013
Interest rate swap
 
$
168

 
$
(1,723
)
 
$
497

 
$
(2,079
)
Related long-term debt
 
(376
)
 
1,376

 
(735
)
 
1,510

Net impact
 
$
(208
)
 
$
(347
)
 
$
(238
)
 
$
(569
)

The gain or loss on the hedged long-term debt netted with the offsetting gain or loss on the related designated and de-designated interest rate swap was recorded on the Condensed Consolidated Statements of Operations as follows:
 
 
Three months ended June 30,
 
Six months ended June 30,
(dollars in thousands)
 
2014
 
2013
 
2014
 
2013
Loss on redemption of debt
 
$
(757
)
 
$

 
$
(757
)
 
$

Other income (expense)
 

 
(347
)
 
70

 
(569
)
Net impact
 
$
(757
)
 
$
(347
)
 
$
(687
)
 
$
(569
)
The following table provides a summary of the effective portion of derivative gain (loss) recognized in other comprehensive income (loss):
 
 
Three months ended June 30,
 
Six months ended June 30,
(dollars in thousands)
 
2014
 
2013
 
2014
 
2013
Derivatives in Cash Flow Hedging relationships:
 
 
 
 
 
 
 
 
Natural gas contracts
 
$
(124
)
 
$
(377
)
 
$
506

 
$
590

Total
 
$
(124
)
 
$
(377
)
 
$
506

 
$
590

Gains (losses) on derivatives that were not designated as hedging instruments are recorded in current earnings as follows:
 
 
 
Three months ended June 30,
 
Six months ended June 30,
(dollars in thousands)
 
 
2014
 
2013
 
2014
 
2013
Derivative:
Location:
 
 

 
 

 
 

 
 

Currency contracts
Other income (expense)
 
$
(187
)
 
$
166

 
$
(187
)
 
$
417

Total
 
 
$
(187
)
 
$
166

 
$
(187
)
 
$
417

Comprehensive Income (Loss) (Tables)
Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block]
Accumulated other comprehensive loss, net of tax, is as follows:
Three months ended June 30, 2014
(dollars in thousands)
 
Foreign Currency Translation
 
Derivative Instruments
 
Pension and Other Postretirement Benefits
 
Total
Accumulated
Comprehensive Loss
Balance on March 31, 2014
 
$
3,966

 
$
1,359

 
$
(77,586
)
 
$
(72,261
)
 
 
 
 
 
 
 
 
 
Other comprehensive income (loss)
 
(785
)
 
(124
)
 
1,292

 
383

Currency impact
 

 

 
297

 
297

 
 
 
 
 
 
 
 
 
Amounts reclassified from accumulated other comprehensive income (loss):
 
 
 
 
 
 
 
 
    Amortization of actuarial loss (1)
 

 

 
1,113

 
1,113

    Amortization of prior service cost (1)
 

 

 
357

 
357

    Cost of sales
 

 
(349
)
 

 
(349
)
Current-period other comprehensive income (loss)
 
(785
)
 
(473
)
 
3,059

 
1,801

Tax effect
 

 
61

 
(975
)
 
(914
)
Balance on June 30, 2014
 
$
3,181

 
$
947

 
$
(75,502
)
 
$
(71,374
)
 
 
 
 
 
 
 
 
 
Six months ended June 30, 2014
(dollars in thousands)
 
Foreign Currency Translation
 
Derivative Instruments
 
Pension and Other Postretirement Benefits
 
Total
Accumulated
Comprehensive Loss
Balance on December 31, 2013
 
$
4,554

 
$
1,221

 
$
(78,935
)
 
$
(73,160
)
 
 
 
 
 
 
 
 
 
Other comprehensive income (loss)
 
(1,373
)
 
506

 
1,292

 
425

Currency impact
 

 

 
310

 
310

 
 
 
 
 
 
 
 
 
Amounts reclassified from accumulated other comprehensive income (loss):
 
 
 
 
 
 
 
 
    Amortization of actuarial loss (1)
 

 

 
2,680

 
2,680

    Amortization of prior service cost (1)
 

 

 
714

 
714

    Cost of sales
 

 
(814
)
 

 
(814
)
Current-period other comprehensive income (loss)
 
(1,373
)
 
(308
)
 
4,996

 
3,315

Tax effect
 

 
34

 
(1,563
)
 
(1,529
)
Balance on June 30, 2014
 
$
3,181

 
$
947

 
$
(75,502
)
 
$
(71,374
)



Three months ended June 30, 2013
(dollars in thousands)
 
Foreign Currency Translation
 
Derivative Instruments
 
Pension and Other Postretirement Benefits
 
Total
Accumulated
Comprehensive Loss
Balance on March 31, 2013
 
$
(4,566
)
 
$
1,534

 
$
(137,217
)
 
$
(140,249
)
 
 
 
 
 
 
 
 
 
Other comprehensive income (loss)
 
2,335

 
(377
)
 
3,059

 
5,017

Currency impact
 

 

 
307

 
307

 
 
 
 
 
 
 
 
 
Amounts reclassified from accumulated other comprehensive income (loss):
 
 
 
 
 
 
 
 
    Amortization of actuarial loss (1)
 

 

 
2,600

 
2,600

    Amortization of prior service cost (1)
 

 

 
390

 
390

    Cost of sales
 

 
(252
)
 

 
(252
)
Current-period other comprehensive income (loss)
 
2,335

 
(629
)
 
6,356

 
8,062

Tax effect
 

 
120

 
56

 
176

Balance on June 30, 2013
 
$
(2,231
)
 
$
1,025

 
$
(130,805
)
 
$
(132,011
)
 
 
 
 
 
 
 
 
 
Six months ended June 30, 2013
(dollars in thousands)
 
Foreign Currency Translation
 
Derivative Instruments
 
Pension and Other Postretirement Benefits
 
Total
Accumulated
Comprehensive Loss
Balance on December 31, 2012
 
$
(1,641
)
 
$
489

 
$
(139,888
)
 
$
(141,040
)
 
 
 
 
 
 
 
 
 
Other comprehensive income (loss)
 
(590
)
 
590

 
3,059

 
3,059

Currency impact
 

 

 
(45
)
 
(45
)
 
 
 
 
 
 
 
 
 
Amounts reclassified from accumulated other comprehensive income (loss):
 
 
 
 
 
 
 
 
    Amortization of actuarial loss (1)
 

 

 
5,200

 
5,200

    Amortization of prior service cost (1)
 

 

 
780

 
780

    Cost of sales
 

 
(6
)
 

 
(6
)
Current-period other comprehensive income (loss)
 
(590
)
 
584

 
8,994

 
8,988

Tax effect
 

 
(48
)
 
89

 
41

Balance on June 30, 2013
 
$
(2,231
)
 
$
1,025

 
$
(130,805
)
 
$
(132,011
)
___________________________
(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 (Tables)
Reconciliation from Segment Totals to Consolidated [Table Text Block]
 
Three months ended June 30,
 
Six months ended June 30,
(dollars in thousands)
2014
 
2013
 
2014
 
2013
Net Sales:
 
 
 
 
 
 
 
Americas
$
154,450

 
$
141,815

 
$
276,375

 
$
265,350

EMEA
39,331

 
37,981

 
73,729

 
72,223

U.S. Sourcing
21,396

 
21,196

 
39,130

 
38,680

Other
8,359

 
8,912

 
15,883

 
17,127

Consolidated
$
223,536

 
$
209,904

 
$
405,117

 
$
393,380

 
 
 
 
 
 
 
 
Segment EBIT:
 
 
 
 
 
 
 
Americas
$
32,986

 
$
33,123

 
$
47,975

 
$
51,925

EMEA
1,910

 
691

 
2,163

 
(671
)
U.S. Sourcing
2,301

 
3,578

 
3,169

 
5,119

Other
869

 
829

 
1,314

 
3,114

Total Segment EBIT
$
38,066

 
$
38,221

 
$
54,621

 
$
59,487

 
 
 
 
 
 
 
 
Reconciliation of Segment EBIT to Net Income (Loss):
 
 
 
 
 
 
 
Segment EBIT
$
38,066

 
$
38,221

 
$
54,621

 
$
59,487

Retained corporate costs
(7,627
)
 
(6,714
)
 
(14,752
)
 
(12,014
)
Loss on redemption of debt (note 4)
(47,191
)
 
(2,518
)
 
(47,191
)
 
(2,518
)
Pension settlement (note 7)

 
(715
)
 

 
(715
)
Furnace malfunction
(576
)
 

 
(5,882
)
 

Restructuring charges (note 5)

 
(1,048
)
 
(985
)
 
(5,928
)
Abandoned property (note 14)

 
(1,781
)
 

 
(1,781
)
Interest expense
(5,486
)
 
(8,126
)
 
(13,187
)
 
(16,561
)
Income taxes
(2,354
)
 
(4,883
)
 
(1,176
)
 
(5,545
)
Net income (loss)
$
(25,168
)
 
$
12,436

 
$
(28,552
)
 
$
14,425

 
 
 
 
 
 
 
 
Depreciation & Amortization:
 
 
 
 
 
 
 
Americas
$
5,851

 
$
7,321

 
$
11,810

 
$
13,849

EMEA
2,738

 
2,507

 
5,364

 
4,993

U.S. Sourcing
7

 
9

 
14

 
18

Other
1,628

 
1,398

 
3,272

 
2,772

Corporate
368

 
388

 
808

 
765

Consolidated
$
10,592

 
$
11,623

 
$
21,268

 
$
22,397

 
 
 
 
 
 
 
 
Capital Expenditures:
 
 
 
 
 
 
 
Americas
$
9,663

 
$
7,034

 
$
16,795

 
$
13,909

EMEA
1,717

 
1,745

 
3,278

 
3,041

U.S. Sourcing

 
32

 

 
32

Other
320

 
1,288

 
892

 
1,623

Corporate
234

 
790

 
870

 
1,166

Consolidated
$
11,934

 
$
10,889

 
$
21,835

 
$
19,771

Fair Value (Tables)
 
Fair Value at
 
Fair Value at
Asset / (Liability)
(dollars in thousands)
June 30, 2014
 
December 31, 2013
Level 1
 
Level 2
 
Level 3
 
Total
 
Level 1
 
Level 2
 
Level 3
 
Total
Commodity futures natural gas contracts
$

 
$
106

 
$

 
$
106

 
$

 
$
413

 
$

 
$
413

Currency contracts

 
(187
)
 

 
(187
)
 

 

 

 

Interest rate agreement

 

 

 

 

 
(2,073
)
 

 
(2,073
)
Net derivative asset (liability)
$

 
$
(81
)
 
$

 
$
(81
)
 
$

 
$
(1,660
)
 
$

 
$
(1,660
)
The total derivative position is recorded on the Condensed Consolidated Balance Sheets as follows:
Asset / (Liability)
(dollars in thousands)
 
June 30, 2014
 
December 31, 2013
Prepaid and other current assets
 
$
182

 
$
394

Other assets
 

 
19

Accrued liabilities
 
(187
)
 

Other long-term liabilities
 
(76
)
 
(2,073
)
Net derivative asset (liability)
 
$
(81
)
 
$
(1,660
)
Other Income (Expense) (Tables)
Schedule of Other Nonoperating Income (Expense) [Table Text Block]
Items included in other income (expense) in the Condensed Consolidated Statements of Operations are as follows:
 
Three months ended June 30,
 
Six months ended June 30,
(dollars in thousands)
2014
 
2013
 
2014
 
2013
Gain (loss) on currency translation
$
(356
)
 
$
481

 
$
(631
)
 
$
198

Hedge ineffectiveness

 
(623
)
 
70

 
(845
)
Other non-operating income (expense)
678

 
193

 
561

 
263

Other income (expense)
$
322

 
$
51

 
$

 
$
(384
)
Description of the Business (Details)
Jun. 30, 2014
country
Production Operations [Member]
 
Description of Business [Line Items]
 
Number of countries in which entity operates
Sales Operations [Member] |
Minimum [Member]
 
Description of Business [Line Items]
 
Number of countries in which entity operates
100 
United States
 
Description of Business [Line Items]
 
Number of glass tableware manufacturing plants
Significant Accounting Policies (Stock-based Compensation) (Details) (USD $)
In Thousands, except Share data, unless otherwise specified
3 Months Ended 6 Months Ended 3 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Mar. 31, 2014
Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
 
Cash settled restricted stock units, granted
 
 
 
 
115,687 
Stock-based compensation expense
$ 1,634 
$ 1,485 
$ 2,637 
$ 2,309 
 
Balance Sheet Details (Details) (USD $)
In Thousands, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
Accounts receivable:
 
 
Accounts receivable
$ 106,345 
$ 94,549 
Allowance for doubtful accounts
6,234 
5,846 
Inventories:
 
 
Finished goods
163,247 
144,945 
Work in process
1,687 
1,615 
Raw materials
4,790 
4,558 
Repair parts
11,058 
10,550 
Operating supplies
1,318 
1,453 
Total inventories, less loss provisions of $4,577 and $4,913
182,100 
163,121 
Inventory loss provisions
4,577 
4,913 
Prepaid and other current assets:
 
 
Value added tax
13,254 
6,697 
Prepaid expenses
10,674 
8,396 
Deferred income taxes
5,840 
5,840 
Prepaid income taxes
4,970 
3,511 
Derivative asset
182 
394 
Total prepaid and other current assets
34,920 
24,838 
Other assets:
 
 
Deposits
1,092 
919 
Finance fees — net of amortization
7,484 
10,472 
Other assets
2,392 
2,143 
Total other assets
10,968 
13,534 
Accrued liabilities:
 
 
Accrued incentives
24,156 
17,830 
Workers compensation
6,873 
7,108 
Medical liabilities
3,109 
3,433 
Interest
3,871 
3,331 
Commissions payable
1,072 
1,067 
Withholdings and other non-income tax accruals
2,134 
1,929 
Other accrued liabilities
7,200 
6,720 
Total accrued liabilities
48,415 
41,418 
Other long-term liabilities:
 
 
Deferred liability
7,237 
7,424 
Derivative liability
76 
2,073 
Other long-term liabilities
4,426 
4,277 
Total other long-term liabilities
11,739 
13,774 
Trade receivables
 
 
Accounts receivable:
 
 
Accounts receivable
104,114 
87,499 
Other receivables [Member]
 
 
Accounts receivable:
 
 
Accounts receivable
$ 2,231 
$ 7,050 
Borrowings (Debt Schedule) (Details) (USD $)
In Thousands, unless otherwise specified
Jun. 30, 2014
May 9, 2014
Apr. 9, 2014
Dec. 31, 2013
Debt Instrument [Line Items]
 
 
 
 
Total borrowings
$ 457,004 
 
 
$ 413,227 
Less - unamortized discount
1,064 
 
 
Plus -- carrying value adjustment on debt related to the Interest Rate Agreement (1)
1
 
 
(1,324)1
Total borrowings -- net
455,940 
 
 
411,903 
Less -- long term debt due within one year
9,761 
 
 
5,391 
Total long-term portion of borrowings -- net
446,179 
 
 
406,512 
Warehouse Promissory Note [Member] |
Promissory Note [Member]
 
 
 
 
Debt Instrument [Line Items]
 
 
 
 
Interest rate
6.00% 
 
 
 
Total borrowings
566 
 
 
681 
Subsidiaries, Libbey Glass and Libbey Europe [Member] |
ABL Facility [Member] |
Line of Credit [Member]
 
 
 
 
Debt Instrument [Line Items]
 
 
 
 
Total borrowings
7,000 
 
 
Subsidiary, Libbey Glass [Member] |
Senior Loans [Member]
 
 
 
 
Debt Instrument [Line Items]
 
 
 
 
Interest rate
3.75% 
 
 
 
Total borrowings
440,000 
 
 
Less - unamortized discount
 
 
1,100 
 
Subsidiary, Libbey Glass [Member] |
Senior Notes [Member]
 
 
 
 
Debt Instrument [Line Items]
 
 
 
 
Interest rate
6.875% 
6.875% 1
 
 
Total borrowings
 
405,000 
405,000 
Subsidiary, Libbey Portugal [Member] |
AICEP Loan [Member] |
Loans Payable [Member]
 
 
 
 
Debt Instrument [Line Items]
 
 
 
 
Interest rate
0.00% 
 
 
 
Total borrowings
4,319 
 
 
2,389 
Loans Payable [Member] |
Subsidiary, Libbey China [Member] |
RMB Working Capital Loan [Member]
 
 
 
 
Debt Instrument [Line Items]
 
 
 
 
Interest rate
6.30% 
 
 
 
Total borrowings
$ 5,119 
 
 
$ 5,157 
Borrowings (ABL Credit Agreement Narrative) (Details) (USD $)
6 Months Ended
Jun. 30, 2014
Dec. 31, 2013
Debt Instrument [Line Items]
 
 
Covenant terms, conditional minimum fixed charge coverage ratio
 
Total borrowings
$ 457,004,000 
$ 413,227,000 
ABL Facility [Member] |
Line of Credit [Member]
 
 
Debt Instrument [Line Items]
 
 
Commitment fee percentage
0.25% 
 
Subsidiaries, Libbey Glass and Libbey Europe [Member] |
ABL Facility [Member] |
Line of Credit [Member]
 
 
Debt Instrument [Line Items]
 
 
Number of financial institutions participating
 
Line of credit facility, maximum borrowing capacity
100,000,000 
 
Covenant, fixed charge coverage ratio, unused borrowing capacity below which covenant is applicable
10,000,000 
 
Additional available borrowing capacity
25,000,000 
 
Borrowing base, component of sum, % of eligible accounts receivable
85.00% 
 
Borrowing base, alternative component of sum, % of NOLV of eligible inventory
85.00% 
 
Borrowing base, alternative component of sum, % of eligible inventory
65.00% 
 
Borrowing base, alternative component of sum, amount
75,000,000 
 
Borrowing base, amount of rent reserves offset
700,000 
 
Borrowing base, amount of natural gas reserves offset
 
Line of credit facility, remaining borrowing capacity
79,700,000 
70,500,000 
Subsidiaries, Libbey Glass and Libbey Europe [Member] |
ABL Facility [Member] |
Letter of Credit [Member]
 
 
Debt Instrument [Line Items]
 
 
Line of credit facility, maximum borrowing capacity
30,000,000 
 
Line of credit facility, amount outstanding
6,800,000 
 
Subsidiary, Libbey Glass [Member] |
ABL Facility [Member] |
Line of Credit [Member]
 
 
Debt Instrument [Line Items]
 
 
Security, percent of entity stock
100.00% 
 
Subsidiary, Libbey Glass [Member] |
Line of Credit, Swingline [Member] |
Line of Credit [Member]
 
 
Debt Instrument [Line Items]
 
 
Line of credit facility, maximum borrowing capacity
15,000,000 
 
Subsidiaries, Present and Future Direct and Indirect Domestic Subsidiaries of Libbey Glass [Member] |
ABL Facility [Member] |
Line of Credit [Member]
 
 
Debt Instrument [Line Items]
 
 
Security, percent of entity stock
100.00% 
 
Subsidiaries, First-tier Present and Future Foreign Subsidiaries of Libbey Glass [Member] |
ABL Facility [Member] |
Line of Credit [Member]
 
 
Debt Instrument [Line Items]
 
 
Security, percent of entity stock, non-voting
100.00% 
 
Security, percent of entity stock, voting
65.00% 
 
Subsidiary, Libbey Europe [Member] |
ABL Facility [Member] |
Line of Credit [Member]
 
 
Debt Instrument [Line Items]
 
 
Security, percent of entity stock
100.00% 
 
Subsidiary, Libbey Europe [Member] |
Line of Credit, Swingline [Member] |
Line of Credit [Member]
 
 
Debt Instrument [Line Items]
 
 
Line of credit facility, maximum borrowing capacity
7,500,000 
 
Subsidiaries, Dutch Subsidiaries of Libbey Europe [Member] |
ABL Facility [Member] |
Line of Credit [Member]
 
 
Debt Instrument [Line Items]
 
 
Security, percent of entity stock
100.00% 
 
CB Floating Rate [Member] |
Line of Credit, Swingline [Member] |
Line of Credit [Member]
 
 
Debt Instrument [Line Items]
 
 
Applicable rates
0.50% 
 
Netherlands Swing Line Rate [Member] |
Line of Credit, Swingline [Member] |
Line of Credit [Member]
 
 
Debt Instrument [Line Items]
 
 
Applicable rates
1.50% 
 
Line of Credit [Member] |
Subsidiaries, Libbey Glass and Libbey Europe [Member] |
ABL Facility [Member]
 
 
Debt Instrument [Line Items]
 
 
Total borrowings
$ 7,000,000 
$ 0 
Interest period, minimum
1 month 
 
Interest period, maximum
6 months 
 
Maximum [Member] |
Subsidiaries, First-Tier Subsidiaries of Libbey Europe and its Dutch Subsidiaries [Member] |
ABL Facility [Member] |
Line of Credit [Member]
 
 
Debt Instrument [Line Items]
 
 
Security, percent of entity stock
100.00% 
 
Borrowings (Term Loan B and Senior Secured Notes Narrative) (Details) (USD $)
3 Months Ended 6 Months Ended 6 Months Ended 0 Months Ended 0 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Dec. 31, 2013
Jun. 30, 2014
Subsidiary, Libbey Glass [Member]
Senior Notes [Member]
May 9, 2014
Subsidiary, Libbey Glass [Member]
Senior Notes [Member]
Apr. 9, 2014
Subsidiary, Libbey Glass [Member]
Senior Notes [Member]
Dec. 31, 2013
Subsidiary, Libbey Glass [Member]
Senior Notes [Member]
Apr. 9, 2014
Subsidiary, Libbey Glass [Member]
Senior Loans [Member]
Jun. 30, 2014
Subsidiary, Libbey Glass [Member]
Senior Loans [Member]
Dec. 31, 2013
Subsidiary, Libbey Glass [Member]
Senior Loans [Member]
Apr. 9, 2014
London Interbank Offered Rate (LIBOR) [Member]
Subsidiary, Libbey Glass [Member]
Senior Loans [Member]
Apr. 9, 2014
London Interbank Offered Rate (LIBOR) [Member]
Minimum [Member]
Subsidiary, Libbey Glass [Member]
Senior Loans [Member]
Debt Instrument [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument, face amount
 
 
 
 
 
 
 
 
 
$ 440,000,000 
 
 
 
 
Proceeds from Issuance of Senior Long-term Debt
438,900,000 
438,900,000 
 
 
 
 
 
438,900,000 
 
 
 
 
Debt Instrument, Discount, Percentage
 
 
 
 
 
 
 
 
 
0.25% 
 
 
 
 
Original issue discount
1,064,000 
 
1,064,000 
 
 
 
 
 
1,100,000 
 
 
 
 
Debt, Long-term and Short-term, Gross
457,004,000 
 
457,004,000 
 
413,227,000 
 
405,000,000 
405,000,000 
 
440,000,000 
 
 
Debt Instrument, Repurchase Amount
 
 
 
 
 
 
45,000,000 
360,000,000 
 
 
 
 
 
 
Deferred finance costs, gross
 
 
 
 
 
 
 
 
 
6,700,000 
 
 
 
 
Aggregate Principal Payments, Quarterly
 
 
 
 
 
 
 
 
 
1,100,000 
 
 
 
 
Applicable rates
 
 
 
 
 
 
 
 
 
 
 
 
3.00% 
0.75% 
Interest rate
 
 
 
 
 
6.875% 
6.875% 1
 
 
 
3.75% 
 
 
 
Refinancing, repricing fee
 
 
 
 
 
 
 
 
 
1.00% 
 
 
 
 
Debt Instrument, Call Premium
 
 
 
 
 
37,300,000 
 
 
 
 
 
 
 
 
Write-off of finance fees on senior notes
$ 9,086,000 
$ 1,168,000 
$ 9,086,000 
$ 1,168,000 
 
$ 9,100,000 
 
 
 
 
 
 
 
 
Borrowings (Interest Rate Swap Narrative) (Details) (USD $)
3 Months Ended 6 Months Ended 0 Months Ended 3 Months Ended 6 Months Ended 3 Months Ended
Jun. 30, 2014
Subsidiary, Libbey Glass [Member]
Senior Notes [Member]
May 9, 2014
Subsidiary, Libbey Glass [Member]
Senior Notes [Member]
Jun. 30, 2014
Interest rate agreements [Member]
Jun. 30, 2013
Interest rate agreements [Member]
Jun. 30, 2014
Interest rate agreements [Member]
Jun. 30, 2013
Interest rate agreements [Member]
May 13, 2014
Fair Value Hedging [Member]
Interest rate agreements [Member]
Senior Notes [Member]
May 9, 2014
Fair Value Hedging [Member]
Interest rate agreements [Member]
Senior Notes [Member]
Apr. 9, 2014
Designated as Hedging Instrument [Member]
Fair Value Hedging [Member]
Interest rate agreements [Member]
Senior Notes [Member]
Jun. 30, 2014
Loss on Redemption of Debt [Member]
Interest rate agreements [Member]
Jun. 30, 2013
Loss on Redemption of Debt [Member]
Interest rate agreements [Member]
Jun. 30, 2014
Loss on Redemption of Debt [Member]
Interest rate agreements [Member]
Jun. 30, 2013
Loss on Redemption of Debt [Member]
Interest rate agreements [Member]
Jun. 30, 2014
Loss on Redemption of Debt [Member]
Fair Value Hedging [Member]
Interest rate agreements [Member]
Senior Notes [Member]
Debt Instrument [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Derivative, notional amount
 
 
 
 
 
 
 
$ 45,000,000 
$ 40,500,000 
 
 
 
 
 
Derivative, variable interest rate
 
 
 
 
 
 
 
5.50% 
 
 
 
 
 
 
Interest rate
6.875% 
6.875% 1
 
 
 
 
 
 
 
 
 
 
 
 
Derivative, payment on hedge
 
 
 
 
 
 
1,100,000 
 
 
 
 
 
 
 
Gain (loss) on the hedged long-term debt netted with the offsetting gain (loss) on the related designated and de-designated interest rate swap
 
 
$ (757,000)
$ (347,000)
$ (687,000)
$ (569,000)
 
 
 
$ (757,000)
$ 0 
$ (757,000)
$ 0 
$ (800,000)
Borrowings (Interest Rate Swap on Senior Secured Notes) (Details) (USD $)
In Thousands, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
Debt Instrument [Line Items]
 
 
Fair market value of Rate Agreement - asset (liability)
$ (81)
$ (1,660)
Adjustment to increase (decrease) the carrying value of the related long-term debt
1
(1,324)1
Derivative asset [Member] |
Interest rate agreements [Member] |
Designated as Hedging Instrument [Member]
 
 
Debt Instrument [Line Items]
 
 
Fair market value of Rate Agreement - asset (liability)
$ 0 
$ (2,073)
Borrowings (Other Borrowings Narrative) (Details)
0 Months Ended
Jun. 30, 2014
USD ($)
Mar. 31, 2014
USD ($)
Dec. 31, 2013
USD ($)
Jun. 30, 2013
USD ($)
Mar. 31, 2013
USD ($)
Dec. 31, 2012
USD ($)
Jun. 30, 2014
Warehouse Promissory Note [Member]
Promissory Note [Member]
USD ($)
Dec. 31, 2013
Warehouse Promissory Note [Member]
Promissory Note [Member]
USD ($)
Sep. 30, 2001
Warehouse Promissory Note [Member]
Promissory Note [Member]
USD ($)
Jun. 30, 2014
Subsidiary, Libbey Portugal [Member]
AICEP Loan [Member]
Loans Payable [Member]
USD ($)
Jun. 30, 2014
Subsidiary, Libbey Portugal [Member]
AICEP Loan [Member]
Loans Payable [Member]
EUR (€)
Dec. 31, 2013
Subsidiary, Libbey Portugal [Member]
AICEP Loan [Member]
Loans Payable [Member]
USD ($)
Jun. 30, 2014
Notes Payable [Member]
USD ($)
Jun. 30, 2014
Notes Payable [Member]
EUR (€)
Sep. 2, 2013
Loans Payable [Member]
Subsidiary, Libbey China [Member]
RMB Working Capital Loan [Member]
USD ($)
Sep. 2, 2013
Loans Payable [Member]
Subsidiary, Libbey China [Member]
RMB Working Capital Loan [Member]
CNY
Jun. 30, 2014
Loans Payable [Member]
Subsidiary, Libbey China [Member]
RMB Working Capital Loan [Member]
USD ($)
Dec. 31, 2013
Loans Payable [Member]
Subsidiary, Libbey China [Member]
RMB Working Capital Loan [Member]
USD ($)
Debt Instrument [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument, face amount
 
 
 
 
 
 
 
 
$ 2,700,000 
$ 4,300,000 
€ 3,200,000 
 
 
 
$ 5,100,000 
 31,500,000 
 
 
Interest rate
 
 
 
 
 
 
6.00% 
 
 
0.00% 
0.00% 
 
 
 
 
 
6.30% 
 
Total borrowings
457,004,000 
 
413,227,000 
 
 
 
566,000 
681,000 
 
4,319,000 
 
2,389,000 
 
 
 
5,119,000 
5,157,000 
Line of credit facility, maximum borrowing capacity
 
 
 
 
 
 
 
 
 
 
 
 
 
1,000,000 
 
 
 
 
Line of credit facility, interest rate at period end
 
 
 
 
 
 
 
 
 
 
 
 
5.80% 
5.80% 
 
 
 
 
Debt instrument, term
 
 
 
 
 
 
 
 
 
 
 
 
 
 
364 days 
364 days 
 
 
Cash on hand
$ 23,209,000 
$ 24,473,000 
$ 42,208,000 
$ 10,544,000 
$ 45,949,000 
$ 67,208,000 
 
 
 
 
 
 
 
 
 
 
 
 
Borrowings (Fair Value of Borrowings) (Details) (USD $)
Jun. 30, 2014
Apr. 9, 2014
Dec. 31, 2013
Debt Instrument [Line Items]
 
 
 
Total borrowings
$ 457,004,000 
 
$ 413,227,000 
Fair Value, Inputs, Level 2 [Member] |
Senior Loans [Member]
 
 
 
Debt Instrument [Line Items]
 
 
 
Debt instrument, fair value
438,900,000 
 
 
Fair Value, Inputs, Level 1 [Member] |
Senior Notes [Member]
 
 
 
Debt Instrument [Line Items]
 
 
 
Debt instrument, fair value
 
 
437,400,000 
Subsidiary, Libbey Glass [Member] |
Senior Loans [Member]
 
 
 
Debt Instrument [Line Items]
 
 
 
Total borrowings
440,000,000 
 
Subsidiary, Libbey Glass [Member] |
Senior Notes [Member]
 
 
 
Debt Instrument [Line Items]
 
 
 
Total borrowings
$ 0 
$ 405,000,000 
$ 405,000,000 
Restructuring Charges (Summary of Pretax Charge) (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring charges
$ 0 
$ (85)
$ 0 
$ 4,229 
Americas [Member] |
Discontinuation of Certain Glassware Production in North America and Reduction of Capacity of Shreveport Facility [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring charges
1,048 
985 
5,928 
Total charges to date
 
 
7,529 
 
Americas [Member] |
Discontinuation of Certain Glassware Production in North America and Reduction of Capacity of Shreveport Facility [Member] |
Cost of Sales [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring charges
1,133 
985 
1,699 
Total charges to date
 
 
2,670 
 
Americas [Member] |
Discontinuation of Certain Glassware Production in North America and Reduction of Capacity of Shreveport Facility [Member] |
Special Charges (Income) [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring charges
(85)
4,229 
Total charges to date
 
 
4,859 
 
Americas [Member] |
Accelerated Depreciation [Member] |
Discontinuation of Certain Glassware Production in North America and Reduction of Capacity of Shreveport Facility [Member] |
Cost of Sales [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring charges
1,133 
1,699 
Total charges to date
 
 
1,685 
 
Americas [Member] |
Other Restructuring Expenses [Member] |
Discontinuation of Certain Glassware Production in North America and Reduction of Capacity of Shreveport Facility [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring charges
 
 
985 
 
Americas [Member] |
Other Restructuring Expenses [Member] |
Discontinuation of Certain Glassware Production in North America and Reduction of Capacity of Shreveport Facility [Member] |
Cost of Sales [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring charges
985 
Total charges to date
 
 
985 
 
Americas [Member] |
Other Restructuring Expenses [Member] |
Discontinuation of Certain Glassware Production in North America and Reduction of Capacity of Shreveport Facility [Member] |
Special Charges (Income) [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring charges
327 
327 
Total charges to date
 
 
1,141 
 
Americas [Member] |
Employee Termination Cost and Other [Member] |
Discontinuation of Certain Glassware Production in North America and Reduction of Capacity of Shreveport Facility [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring charges
 
 
 
Americas [Member] |
Employee Termination Cost and Other [Member] |
Discontinuation of Certain Glassware Production in North America and Reduction of Capacity of Shreveport Facility [Member] |
Special Charges (Income) [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring charges
(412)
1,910 
Total charges to date
 
 
1,794 
 
Americas [Member] |
Fixed Asset Write-down [Member] |
Discontinuation of Certain Glassware Production in North America and Reduction of Capacity of Shreveport Facility [Member] |
Special Charges (Income) [Member]
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
Restructuring charges
1,992 
Total charges to date
 
 
$ 1,924 
 
Restructuring Charges (Capacity Realignment Reserve Activity) (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Restructuring Reserve [Roll Forward]
 
 
 
 
Total charge to earnings
$ 0 
$ (85)
$ 0 
$ 4,229 
Americas [Member] |
Discontinuation of Certain Glassware Production in North America and Reduction of Capacity of Shreveport Facility [Member]
 
 
 
 
Restructuring Reserve [Roll Forward]
 
 
 
 
Reserve balance at January 1, 2014
 
 
289 
 
Total charge to earnings
1,048 
985 
5,928 
Cash (payments) receipts
 
 
(1,274)
 
Non-cash Utilization
 
 
 
Reserve balance at June 30, 2014
 
 
Americas [Member] |
Employee Termination Cost and Other [Member] |
Discontinuation of Certain Glassware Production in North America and Reduction of Capacity of Shreveport Facility [Member]
 
 
 
 
Restructuring Reserve [Roll Forward]
 
 
 
 
Reserve balance at January 1, 2014
 
 
289 
 
Total charge to earnings
 
 
 
Cash (payments) receipts
 
 
(289)
 
Non-cash Utilization
 
 
 
Reserve balance at June 30, 2014
 
 
Americas [Member] |
Other Restructuring Expenses [Member] |
Discontinuation of Certain Glassware Production in North America and Reduction of Capacity of Shreveport Facility [Member]
 
 
 
 
Restructuring Reserve [Roll Forward]
 
 
 
 
Reserve balance at January 1, 2014
 
 
 
Total charge to earnings
 
 
985 
 
Cash (payments) receipts
 
 
(985)
 
Non-cash Utilization
 
 
 
Reserve balance at June 30, 2014
$ 0 
 
$ 0 
 
Income Taxes (Details) (USD $)
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Dec. 31, 2013
Income Tax Disclosure [Abstract]
 
 
 
 
 
Effective income tax rate, continuing operations
 
 
(4.30%)
27.80% 
 
Gross unrecognized tax benefits, net of interest and penalties
$ 800,000 
 
$ 800,000 
 
$ 1,300,000 
Tax benefit recognized due to expiration of statute of limitations
100,000 
600,000 
500,000 
 
Income tax expense (benefit), intraperiod tax allocation
(1,000,000)
(1,600,000)
 
Total income tax payments, net of refunds
2,425,000 
7,270,000 
5,153,000 
9,539,000 
 
Less: credits or offsets
948,000 
1,339,000 
1,860,000 
1,724,000 
 
Cash paid, net
$ 1,477,000 
$ 5,931,000 
$ 3,293,000 
$ 7,815,000 
 
Pension and Non-pension Postretirement Benefits (Net Benefit Costs) (Details) (USD $)
0 Months Ended 3 Months Ended 6 Months Ended
Jan. 2, 2013
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Amortization of unrecognized:
 
 
 
 
 
Settlement charge
 
$ 0 
$ 715,000 
$ 0 
$ 715,000 
Defined Benefit Pension Plans and SERP [Member]
 
 
 
 
 
Defined Benefit Plan Disclosure [Line Items]
 
 
 
 
 
Service cost
 
1,386,000 
1,778,000 
2,989,000 
3,778,000 
Interest cost
 
5,241,000 
4,696,000 
10,535,000 
9,433,000 
Expected return on plan assets
 
(6,209,000)
(6,101,000)
(12,449,000)
(12,181,000)
Amortization of unrecognized:
 
 
 
 
 
Prior service cost
 
322,000 
353,000 
644,000 
708,000 
Loss / (gain)
 
1,046,000 
2,478,000 
2,546,000 
4,803,000 
Settlement charge
 
715,000 
715,000 
Pension expense or non-pension postretirement benefit expense
 
1,786,000 
3,919,000 
4,265,000 
7,256,000 
Defined Benefit Plan, Contributions [Abstract]
 
 
 
 
 
Employer contributions made to defined benefit plans
 
800,000 
 
1,900,000 
 
Estimated employer contributions to defined benefit plans in remainder of 2014
 
4,400,000 
 
 
 
U.S. Plans [Member]
 
 
 
 
 
Defined Benefit Plan Disclosure [Line Items]
 
 
 
 
 
Service cost
 
807,000 
1,092,000 
1,832,000 
2,370,000 
Interest cost
 
3,819,000 
3,501,000 
7,689,000 
6,982,000 
Expected return on plan assets
 
(5,585,000)
(5,605,000)
(11,193,000)
(11,204,000)
Amortization of unrecognized:
 
 
 
 
 
Prior service cost
 
264,000 
293,000 
529,000 
586,000 
Loss / (gain)
 
787,000 
2,263,000 
2,029,000 
4,350,000 
Settlement charge
 
715,000 
715,000 
Pension expense or non-pension postretirement benefit expense
 
92,000 
2,259,000 
886,000 
3,799,000 
Non-U.S. Plans [Member]
 
 
 
 
 
Defined Benefit Plan Disclosure [Line Items]
 
 
 
 
 
Service cost
 
579,000 
686,000 
1,157,000 
1,408,000 
Interest cost
 
1,422,000 
1,195,000 
2,846,000 
2,451,000 
Expected return on plan assets
 
(624,000)
(496,000)
(1,256,000)
(977,000)
Amortization of unrecognized:
 
 
 
 
 
Prior service cost
 
58,000 
60,000 
115,000 
122,000 
Loss / (gain)
 
259,000 
215,000 
517,000 
453,000 
Settlement charge
 
Pension expense or non-pension postretirement benefit expense
 
1,694,000 
1,660,000 
3,379,000 
3,457,000 
Non-Pension Postretirement Benefit Plans [Member]
 
 
 
 
 
Defined Benefit Plan Disclosure [Line Items]
 
 
 
 
 
Service cost
 
252,000 
204,000 
504,000 
596,000 
Interest cost
 
739,000 
641,000 
1,476,000 
1,365,000 
Amortization of unrecognized:
 
 
 
 
 
Prior service cost
 
35,000 
36,000 
70,000 
70,000 
Loss / (gain)
 
67,000 
139,000 
134,000 
429,000 
Pension expense or non-pension postretirement benefit expense
 
1,093,000 
1,020,000 
2,184,000 
2,460,000 
Defined Benefit Plan, Contributions [Abstract]
 
 
 
 
 
Employer contributions made to defined benefit plans
 
1,000,000 
 
2,100,000 
 
Estimated employer contributions to defined benefit plans in year 2014
 
4,800,000 
 
 
 
Retirees subject to health reimbursement arrangement, minimum age
65 years 
 
 
 
 
Life insurance benefit, maximum
10,000 
 
 
 
 
U.S. Plans [Member]
 
 
 
 
 
Defined Benefit Plan Disclosure [Line Items]
 
 
 
 
 
Service cost
 
251,000 
203,000 
503,000 
595,000 
Interest cost
 
710,000 
610,000 
1,420,000 
1,311,000 
Amortization of unrecognized:
 
 
 
 
 
Prior service cost
 
35,000 
36,000 
70,000 
70,000 
Loss / (gain)
 
67,000 
138,000 
134,000 
429,000 
Pension expense or non-pension postretirement benefit expense
 
1,063,000 
987,000 
2,127,000 
2,405,000 
Non-U.S. Plans [Member]
 
 
 
 
 
Defined Benefit Plan Disclosure [Line Items]
 
 
 
 
 
Service cost
 
1,000 
1,000 
1,000 
1,000 
Interest cost
 
29,000 
31,000 
56,000 
54,000 
Amortization of unrecognized:
 
 
 
 
 
Prior service cost
 
Loss / (gain)
 
1,000 
Pension expense or non-pension postretirement benefit expense
 
$ 30,000 
$ 33,000 
$ 57,000 
$ 55,000 
Net Income (Loss) per Share of Common Stock (Details) (USD $)
In Thousands, except Share data, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Numerators for earnings per share:
 
 
 
 
Net income (loss) that is available to common shareholders
$ (25,168)
$ 12,436 
$ (28,552)
$ 14,425 
Denominator for basic earnings per share:
 
 
 
 
Weighted average shares outstanding
21,672,844 
21,288,897 
21,600,125 
21,202,411 
Denominator for diluted earnings per share:
 
 
 
 
Effect of stock options and restricted stock units
654,388 
504,622 
Adjusted weighted average shares and assumed conversions
21,672,844 
21,943,285 
21,600,125 
21,707,033 
Basic earnings (loss) per share
$ (1.16)
$ 0.58 
$ (1.32)
$ 0.68 
Diluted earnings (loss) per share
$ (1.16)
$ 0.57 
$ (1.32)
$ 0.66 
Net loss position (excluded from denominator)
 
 
 
 
Shares excluded from diluted earnings (loss) per share due to:
 
 
 
 
Antidilutive securities excluded from diluted earnings per share
490,706 
465,577 
Inclusion would have been anti-dilutive (excluded from calculation)
 
 
 
 
Shares excluded from diluted earnings (loss) per share due to:
 
 
 
 
Antidilutive securities excluded from diluted earnings per share
182,850 
319,288 
130,165 
370,936 
Derivatives (Narrative - Commodity Future Contracts) (Details) (Cash Flow Hedging [Member], Natural gas contracts [Member], USD $)
In Millions, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
MMBTU
Jun. 30, 2013
Jun. 30, 2014
MMBTU
Jun. 30, 2013
Dec. 31, 2013
MMBTU
Derivative [Line Items]
 
 
 
 
 
Natural gas contracts, notional amounts (in millions of BTUs)
3,020,000 
 
3,020,000 
 
1,520,000 
Loss on Cash Flow Hedge Ineffectiveness
 
$ (0.3)
 
$ (0.3)
 
Derivative, additional cash paid (received) on settlement of hedge
(0.3)
(0.3)
(0.8)
 
Cash flow hedge loss to be reclassified within 12 months
 
 
$ 0.2 
 
 
Minimum [Member]
 
 
 
 
 
Derivative [Line Items]
 
 
 
 
 
Forecast of anticipated requirements, percentage of forecast eligible for hedging
40.00% 
 
40.00% 
 
 
Maximum [Member]
 
 
 
 
 
Derivative [Line Items]
 
 
 
 
 
Forecast of anticipated requirements, percentage of forecast eligible for hedging
70.00% 
 
70.00% 
 
 
Forecast of commodity requirements, maximum length of time used
 
 
18 months 
 
 
Derivatives (Fair Value of Derivative Assets and Liabilities) (Details) (USD $)
In Thousands, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
Derivatives, Fair Value [Line Items]
 
 
Fair value, derivative asset
$ 182 
$ 413 
Fair value, derivative liability
263 
2,073 
Designated as Hedging Instrument [Member]
 
 
Derivatives, Fair Value [Line Items]
 
 
Fair value, derivative asset
182 
413 
Fair value, derivative liability
76 
1,866 
Not Designated as Hedging Instrument [Member]
 
 
Derivatives, Fair Value [Line Items]
 
 
Fair value, derivative liability
187 
207 
Interest rate agreements [Member] |
Designated as Hedging Instrument [Member] |
Other Long-Term Liabilities [Member]
 
 
Derivatives, Fair Value [Line Items]
 
 
Fair value, derivative liability
1,866 
Interest rate agreements [Member] |
Not Designated as Hedging Instrument [Member] |
Other Long-Term Liabilities [Member]
 
 
Derivatives, Fair Value [Line Items]
 
 
Fair value, derivative liability
207 
Currency contracts [Member] |
Not Designated as Hedging Instrument [Member] |
Accrued Liabilities [Member]
 
 
Derivatives, Fair Value [Line Items]
 
 
Fair value, derivative liability
187 
Natural gas contracts [Member] |
Designated as Hedging Instrument [Member] |
Prepaid and other current assets [Member]
 
 
Derivatives, Fair Value [Line Items]
 
 
Fair value, derivative asset
182 
394 
Natural gas contracts [Member] |
Designated as Hedging Instrument [Member] |
Other assets [Member]
 
 
Derivatives, Fair Value [Line Items]
 
 
Fair value, derivative asset
19 
Natural gas contracts [Member] |
Designated as Hedging Instrument [Member] |
Other Long-Term Liabilities [Member]
 
 
Derivatives, Fair Value [Line Items]
 
 
Fair value, derivative liability
$ 76 
$ 0 
Derivatives (Gain Loss on Interest Rate Swaps Included in Earnings) (Details) (USD $)
3 Months Ended 6 Months Ended 0 Months Ended 3 Months Ended 6 Months Ended 3 Months Ended 6 Months Ended 3 Months Ended 6 Months Ended 3 Months Ended 6 Months Ended 0 Months Ended 3 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Jul. 2, 2013
Interest rate agreements [Member]
Jun. 30, 2014
Interest rate agreements [Member]
Jun. 30, 2013
Interest rate agreements [Member]
Jun. 30, 2014
Interest rate agreements [Member]
Jun. 30, 2013
Interest rate agreements [Member]
Jun. 30, 2014
Interest rate agreements [Member]
Loss on Redemption of Debt [Member]
Jun. 30, 2013
Interest rate agreements [Member]
Loss on Redemption of Debt [Member]
Jun. 30, 2014
Interest rate agreements [Member]
Loss on Redemption of Debt [Member]
Jun. 30, 2013
Interest rate agreements [Member]
Loss on Redemption of Debt [Member]
Jun. 30, 2014
Interest rate agreements [Member]
Other Income (Expense) [Member]
Jun. 30, 2013
Interest rate agreements [Member]
Other Income (Expense) [Member]
Jun. 30, 2014
Interest rate agreements [Member]
Other Income (Expense) [Member]
Jun. 30, 2013
Interest rate agreements [Member]
Other Income (Expense) [Member]
Jun. 30, 2014
Senior Notes [Member]
Jun. 30, 2013
Senior Notes [Member]
Jun. 30, 2014
Senior Notes [Member]
Jun. 30, 2013
Senior Notes [Member]
Jul. 2, 2013
Senior Notes [Member]
Interest rate agreements [Member]
May 13, 2014
Fair Value Hedging [Member]
Senior Notes [Member]
Interest rate agreements [Member]
May 9, 2014
Fair Value Hedging [Member]
Senior Notes [Member]
Interest rate agreements [Member]
Jun. 30, 2014
Fair Value Hedging [Member]
Senior Notes [Member]
Interest rate agreements [Member]
Loss on Redemption of Debt [Member]
Apr. 9, 2014
Fair Value Hedging [Member]
Designated as Hedging Instrument [Member]
Senior Notes [Member]
Interest rate agreements [Member]
Derivative Instruments, Gain (Loss) [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Derivative, notional amount
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 45,000,000 
 
$ 40,500,000 
Derivative, payment on hedge
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,100,000 
 
 
 
Derivative, notional amount de-designated, percent of total
 
 
 
 
10.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Derivative, notional amount de-designated
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
4,500,000 
 
 
 
 
Gain (loss) from de-designated portion of Interest Rate Agreement
(549,000)
(449,000)
 
40,000 
140,000 
 
 
 
 
 
 
 
 
(589,000)
(589,000)
 
 
 
 
 
Gain (loss) from designated portion of Interest Rate Agreement
(208,000)
(347,000)
(238,000)
(569,000)
 
168,000 
(1,723,000)
497,000 
(2,079,000)
 
 
 
 
 
 
 
 
(376,000)
1,376,000 
(735,000)
1,510,000 
 
 
 
 
 
Gain (loss) on the hedged long-term debt netted with the offsetting gain (loss) on the related designated and de-designated interest rate swap
 
 
 
 
 
$ (757,000)
$ (347,000)
$ (687,000)
$ (569,000)
$ (757,000)
$ 0 
$ (757,000)
$ 0 
$ 0 
$ (347,000)
$ 70,000 
$ (569,000)
 
 
 
 
 
 
 
$ (800,000)
 
Derivatives (Effective Portion of Derivative Gain Loss) (Details) (Designated as Hedging Instrument [Member], Cash Flow Hedging [Member], USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Derivative Instruments, Gain (Loss) [Line Items]
 
 
 
 
Effective portion of derivative gain (loss) recognized in other comprehensive income (loss)
$ (124)
$ (377)
$ 506 
$ 590 
Effective portion of derivative gain (loss) reclassified from accumulated other comprehensive loss into income
349 
252 
814 
Natural gas contracts [Member]
 
 
 
 
Derivative Instruments, Gain (Loss) [Line Items]
 
 
 
 
Effective portion of derivative gain (loss) recognized in other comprehensive income (loss)
(124)
(377)
506 
590 
Natural gas contracts [Member] |
Cost of Sales [Member]
 
 
 
 
Derivative Instruments, Gain (Loss) [Line Items]
 
 
 
 
Effective portion of derivative gain (loss) reclassified from accumulated other comprehensive loss into income
$ 349 
$ 252 
$ 814 
$ 6 
Derivatives (Gains and Losses on Derivatives that were Not Designated as Hedging Instruments) (Details)
3 Months Ended 6 Months Ended 3 Months Ended 6 Months Ended
Jun. 30, 2014
USD ($)
Jun. 30, 2013
USD ($)
Jun. 30, 2014
USD ($)
Jun. 30, 2013
USD ($)
Jun. 30, 2014
Other Income (Expense) [Member]
Currency contracts [Member]
USD ($)
Jun. 30, 2013
Other Income (Expense) [Member]
Currency contracts [Member]
USD ($)
Jun. 30, 2014
Other Income (Expense) [Member]
Currency contracts [Member]
USD ($)
Jun. 30, 2013
Other Income (Expense) [Member]
Currency contracts [Member]
USD ($)
Jun. 30, 2014
Not Designated as Hedging Instrument [Member]
Currency contracts [Member]
CAD ($)
Dec. 31, 2013
Not Designated as Hedging Instrument [Member]
Currency contracts [Member]
CAD ($)
Derivative [Line Items]
 
 
 
 
 
 
 
 
 
 
Derivative, notional amount
 
 
 
 
 
 
 
 
$ 7,700,000 
$ 0 
Gain (loss) on derivatives not designated as hedging instruments
$ (187,000)
$ 166,000 
$ (187,000)
$ 417,000 
$ (187,000)
$ 166,000 
$ (187,000)
$ 417,000 
 
 
Comprehensive Income (Loss) (Schedule of AOCI) (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Change in Accumulated Other Comprehensive Loss [Roll Forward]
 
 
 
 
Beginning balance
$ (72,261)
$ (140,249)
$ (73,160)
$ (141,040)
Other comprehensive income (loss)
383 
5,017 
425 
3,059 
Currency impact
297 
307 
310 
(45)
Amounts reclassified from accumulated other comprehensive income (loss):
 
 
 
 
Amortization of actuarial loss (1)
1,113 1
2,600 1
2,680 1
5,200 1
Amortization of prior service cost (1)
357 1
390 1
714 1
780 1
Cost of sales
(349)
(252)
(814)
(6)
Current-period other comprehensive income (loss)
1,801 
8,062 
3,315 
8,988 
Tax effect
(914)
176 
(1,529)
41 
Ending balance
(71,374)
(132,011)
(71,374)
(132,011)
Foreign Currency Translation [Member]
 
 
 
 
Change in Accumulated Other Comprehensive Loss [Roll Forward]
 
 
 
 
Beginning balance
3,966 
(4,566)
4,554 
(1,641)
Other comprehensive income (loss)
(785)
2,335 
(1,373)
(590)
Amounts reclassified from accumulated other comprehensive income (loss):
 
 
 
 
Current-period other comprehensive income (loss)
(785)
2,335 
(1,373)
(590)
Tax effect
Ending balance
3,181 
(2,231)
3,181 
(2,231)
Derivative Instruments [Member]
 
 
 
 
Change in Accumulated Other Comprehensive Loss [Roll Forward]
 
 
 
 
Beginning balance
1,359 
1,534 
1,221 
489 
Other comprehensive income (loss)
(124)
(377)
506 
590 
Amounts reclassified from accumulated other comprehensive income (loss):
 
 
 
 
Cost of sales
(349)
(252)
(814)
(6)
Current-period other comprehensive income (loss)
(473)
(629)
(308)
584 
Tax effect
61 
120 
34 
(48)
Ending balance
947 
1,025 
947 
1,025 
Pension and Other Postretirement Benefits [Member]
 
 
 
 
Change in Accumulated Other Comprehensive Loss [Roll Forward]
 
 
 
 
Beginning balance
(77,586)
(137,217)
(78,935)
(139,888)
Other comprehensive income (loss)
1,292 
3,059 
1,292 
3,059 
Currency impact
297 
307 
310 
(45)
Amounts reclassified from accumulated other comprehensive income (loss):
 
 
 
 
Amortization of actuarial loss (1)
1,113 1
2,600 1
2,680 1
5,200 1
Amortization of prior service cost (1)
357 1
390 1
714 1
780 1
Current-period other comprehensive income (loss)
3,059 
6,356 
4,996 
8,994 
Tax effect
(975)
56 
(1,563)
89 
Ending balance
$ (75,502)
$ (130,805)
$ (75,502)
$ (130,805)
Segments (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Sep. 30, 2011
Jun. 30, 2014
segment
Jun. 30, 2013
Segment Reporting Information [Line Items]
 
 
 
 
 
Number of reportable segments
 
 
 
 
Net Sales:
 
 
 
 
 
Net sales
$ 223,536 
$ 209,904 
 
$ 405,117 
$ 393,380 
Segment EBIT:
 
 
 
 
 
Segment EBIT
38,066 
38,221 
 
54,621 
59,487 
Reconciliation of Segment EBIT to Net Income (Loss):
 
 
 
 
 
Retained corporate costs
(7,627)
(6,714)
 
(14,752)
(12,014)
Loss on redemption of debt (note 4)
(47,191)
(2,518)
 
(47,191)
(2,518)
Pension settlement (note 7)
(715)
 
(715)
Furnace malfunction
(576)
 
(5,882)
Restructuring charges (note 5)
(1,048)
 
(985)
(5,928)
Abandoned property (note 14)
(1,781)
(2,700)
(1,781)
Interest expense
(5,486)
(8,126)
 
(13,187)
(16,561)
Income taxes
(2,354)
(4,883)
 
(1,176)
(5,545)
Net income (loss)
(25,168)
12,436 
 
(28,552)
14,425 
Depreciation & Amortization:
 
 
 
 
 
Depreciation and amortization
10,592 
11,623 
 
21,268 
22,397 
Capital Expenditures:
 
 
 
 
 
Capital Expenditures
11,934 
10,889 
 
21,835 
19,771 
Americas [Member]
 
 
 
 
 
Net Sales:
 
 
 
 
 
Net sales
154,450 
141,815 
 
276,375 
265,350 
Segment EBIT:
 
 
 
 
 
Segment EBIT
32,986 
33,123 
 
47,975 
51,925 
Depreciation & Amortization:
 
 
 
 
 
Depreciation and amortization
5,851 
7,321 
 
11,810 
13,849 
Capital Expenditures:
 
 
 
 
 
Capital Expenditures
9,663 
7,034 
 
16,795 
13,909 
EMEA [Member]
 
 
 
 
 
Net Sales:
 
 
 
 
 
Net sales
39,331 
37,981 
 
73,729 
72,223 
Segment EBIT:
 
 
 
 
 
Segment EBIT
1,910 
691 
 
2,163 
(671)
Depreciation & Amortization:
 
 
 
 
 
Depreciation and amortization
2,738 
2,507 
 
5,364 
4,993 
Capital Expenditures:
 
 
 
 
 
Capital Expenditures
1,717 
1,745 
 
3,278 
3,041 
U.S. Sourcing [Member]
 
 
 
 
 
Net Sales:
 
 
 
 
 
Net sales
21,396 
21,196 
 
39,130 
38,680 
Segment EBIT:
 
 
 
 
 
Segment EBIT
2,301 
3,578 
 
3,169 
5,119 
Depreciation & Amortization:
 
 
 
 
 
Depreciation and amortization
 
14 
18 
Capital Expenditures:
 
 
 
 
 
Capital Expenditures
32 
 
32 
Other Segments [Member]
 
 
 
 
 
Net Sales:
 
 
 
 
 
Net sales
8,359 
8,912 
 
15,883 
17,127 
Segment EBIT:
 
 
 
 
 
Segment EBIT
869 
829 
 
1,314 
3,114 
Depreciation & Amortization:
 
 
 
 
 
Depreciation and amortization
1,628 
1,398 
 
3,272 
2,772 
Capital Expenditures:
 
 
 
 
 
Capital Expenditures
320 
1,288 
 
892 
1,623 
Corporate [Member]
 
 
 
 
 
Depreciation & Amortization:
 
 
 
 
 
Depreciation and amortization
368 
388 
 
808 
765 
Capital Expenditures:
 
 
 
 
 
Capital Expenditures
$ 234 
$ 790 
 
$ 870 
$ 1,166 
Fair Value (Details) (USD $)
In Thousands, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Net derivative asset (liability)
$ (81)
$ (1,660)
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 1 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Net derivative asset (liability)
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 2 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Net derivative asset (liability)
(81)
(1,660)
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 3 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Net derivative asset (liability)
Fair Value, Measurements, Recurring [Member] |
Estimate of Fair Value, Fair Value Disclosure [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Net derivative asset (liability)
(81)
(1,660)
Commodity futures natural gas contracts [Member] |
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 1 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Net derivative asset (liability)
Commodity futures natural gas contracts [Member] |
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 2 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Net derivative asset (liability)
106 
413 
Commodity futures natural gas contracts [Member] |
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 3 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Net derivative asset (liability)
Commodity futures natural gas contracts [Member] |
Fair Value, Measurements, Recurring [Member] |
Estimate of Fair Value, Fair Value Disclosure [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Net derivative asset (liability)
106 
413 
Currency contracts [Member] |
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 1 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Net derivative asset (liability)
Currency contracts [Member] |
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 2 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Net derivative asset (liability)
(187)
Currency contracts [Member] |
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 3 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Net derivative asset (liability)
Currency contracts [Member] |
Fair Value, Measurements, Recurring [Member] |
Estimate of Fair Value, Fair Value Disclosure [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Net derivative asset (liability)
(187)
Interest rate agreements [Member] |
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 1 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Net derivative asset (liability)
Interest rate agreements [Member] |
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 2 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Net derivative asset (liability)
(2,073)
Interest rate agreements [Member] |
Fair Value, Measurements, Recurring [Member] |
Fair Value, Inputs, Level 3 [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Net derivative asset (liability)
Interest rate agreements [Member] |
Fair Value, Measurements, Recurring [Member] |
Estimate of Fair Value, Fair Value Disclosure [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Net derivative asset (liability)
$ 0 
$ (2,073)
Fair Value (Balance Sheet Location) (Details) (USD $)
In Thousands, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Net derivative asset (liability)
$ (81)
$ (1,660)
Prepaid and other current assets [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Assets, fair value
182 
394 
Other assets [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Assets, fair value
19 
Accrued Liabilities [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Liabilities, fair value
(187)
Other long-term liabilities [Member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Liabilities, fair value
$ (76)
$ (2,073)
Other Income (Expense) (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Component of Other Income (Expense), Nonoperating [Line Items]
 
 
 
 
Other income (expense)
$ 322 
$ 51 
$ 0 
$ (384)
Gain (loss) on currency translation [Member]
 
 
 
 
Component of Other Income (Expense), Nonoperating [Line Items]
 
 
 
 
Other income (expense)
(356)
481 
(631)
198 
Hedge ineffectiveness
 
 
 
 
Component of Other Income (Expense), Nonoperating [Line Items]
 
 
 
 
Other income (expense)
(623)
70 
(845)
Other non-operating income (expense) [Member]
 
 
 
 
Component of Other Income (Expense), Nonoperating [Line Items]
 
 
 
 
Other income (expense)
$ 678 
$ 193 
$ 561 
$ 263 
Contingencies (Site) (Details)
0 Months Ended
Oct. 30, 2009
Site Contingency [Line Items]
 
Site Contingency, Number of Potentially Responsible Parties
Syracuse China [Member]
 
Site Contingency [Line Items]
 
Site Contingency, Number of Potentially Responsible Related Parties
Contingencies (Insurance Claim) (Details) (USD $)
6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Dec. 31, 2013
Commitments and Contingencies Disclosure [Abstract]
 
 
 
Insurance Settlements Receivable
 
 
$ 5,000,000 
Proceeds from Insurance Settlement, Investing Activities
4,346,000 
 
Proceeds from Insurance Settlement, Operating Activities
$ 700,000 
 
 
Loss Contingencies (Abandoned Property) (Details) (USD $)
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Sep. 30, 2011
Jun. 30, 2014
Jun. 30, 2013
Loss Contingencies [Line Items]
 
 
 
 
 
Loss Contingency Accrual, Payments
 
$ 4,500,000 
 
 
 
Loss Contingency, Loss in Period
1,781,000 
2,700,000 
1,781,000 
Selling, General and Administrative Expenses [Member]
 
 
 
 
 
Loss Contingencies [Line Items]
 
 
 
 
 
Loss Contingency, Loss in Period
 
$ 1,800,000