Segment Information

12 Months Ended

Dec. 31, 2012

Segment Information

Segment Information

2. Segment Information

        The Company has four reportable segments based on its geographic locations: Europe, North America, South America and Asia Pacific. These four segments are aligned with the Company's internal approach to managing, reporting, and evaluating performance of its global glass operations. Certain assets and activities not directly related to one of the regions or to glass manufacturing are reported with Retained corporate costs and other. These include licensing, equipment manufacturing, global engineering, and non-glass equity investments. Retained corporate costs and other also includes certain headquarters administrative and facilities costs and certain incentive compensation and other benefit plan costs that are global in nature and are not allocable to the reportable segments.

        The Company's measure of profit for its reportable segments is segment operating profit, which consists of consolidated earnings from continuing operations before interest income, interest expense, and provision for income taxes and excludes amounts related to certain items that management considers not representative of ongoing operations as well as certain retained corporate costs. The Company's management uses segment operating profit, in combination with selected cash flow information, to evaluate performance and to allocate resources. Segment operating profit for reportable segments includes an allocation of some corporate expenses based on both a percentage of sales and direct billings based on the costs of specific services provided.

        In prior periods, pension expense was recorded in each segment related to the pension plans in place in that segment, with the exception of the U.S. pension plans which were recorded in Retained corporate costs and other. Effective January 1, 2012, the Company changed the allocation of pension expense to its reportable segments such that pension expense recorded in each segment relates only to the service cost component of the plans in that segment. The other components of pension expense, including interest cost, expected asset returns and amortization of actuarial losses, are recorded in Retained corporate costs and other. This change in allocation has been applied retrospectively to all periods. Also effective January 1, 2012, the Company elected to change the method of valuing U.S. inventories (see Note 1 for additional information).

        The impact of the changes in pension expense allocation and accounting method for inventory on segment operating profit for the year ended December 31, 2011 is as follows:

	As Orginally Reported			Change in Pension Allocation			Change in Accounting Method for Inventory		As Adjusted
Segment operating profit:
Europe	$	325		$	20		$	—	$	345
North America		236			(24	)		10		222
South America		250								250
Asia Pacific		83								83
Reportable segment totals		894			(4	)		10		900
Retained corporate costs and other		(79	)		4					(75	)

        The impact of the changes in pension expense allocation and accounting method for inventory on segment operating profit for the year ended December 31, 2010 is as follows:

	As Orginally Reported			Change in Pension Allocation			Change in Accounting Method for Inventory		As Adjusted
Segment operating profit:
Europe	$	324		$	16		$	—	$	340
North America		275			(24	)		2		253
South America		224								224
Asia Pacific		141			3					144
Reportable segment totals		964			(5	)		2		961
Retained corporate costs and other		(89	)		5					(84	)

        Financial information regarding the Company's reportable segments is as follows:

	2012		2011		2010
Net sales:
Europe	$	2,717	$	3,052	$	2,746
North America		1,966		1,929		1,879
South America		1,252		1,226		975
Asia Pacific		1,028		1,059		996
Reportable segment totals		6,963		7,266		6,596
Other		37		92		37
Net sales	$	7,000	$	7,358	$	6,633

	2012			2011			2010
Segment operating profit:
Europe	$	307		$	345		$	340
North America		288			222			253
South America		227			250			224
Asia Pacific		113			83			144
Reportable segment totals		935			900			961
Items excluded from segment operating profit:
Retained corporate costs and other		(106	)		(75	)		(84	)
Restructuring, asset impairment and related charges		(168	)		(112	)		(13	)
Acquisition-related fair value inventory adjustments and restructuring, transaction and financing costs								(32	)
Charge for asbestos related costs		(155	)		(165	)		(170	)
Charge for goodwill impairment					(641	)
Gain on China land compensation		61
Interest income		9			11			13
Interest expense		(248	)		(314	)		(249	)
Earnings (loss) from continuing operations before income taxes	$	328		$	(396	)	$	426

	Europe		North America		South America		Asia Pacific		Reportable Segment Totals		Retained Corp Costs and Other		Consolidated Totals
Total assets:
2012	$	3,362	$	1,994	$	1,655	$	1,349	$	8,360	$	238	$	8,598
2011		3,588		2,020		1,682		1,379		8,669		306		8,975
2010		3,618		2,000		1,680		2,047		9,345		448		9,793
Equity investments:
2012	$	63	$	25	$	—	$	165	$	253	$	41	$	294
2011		59		27				181		267		48		315
2010		53		17		5		179		254		45		299
Equity earnings:
2012	$	15	$	16	$	—	$	5	$	36	$	28	$	64
2011		21		9				3		33		33		66
2010		19		15				1		35		24		59
Capital expenditures(1):
2012	$	87	$	68	$	75	$	49	$	279	$	11	$	290
2011		127		60		50		37		274		11		285
2010
Continuing		151		156		96		85		488		12		500
Discontinued												3		3
Depreciation and amortization expense:
2012	$	150	$	107	$	70	$	70	$	397	$	15	$	412
2011		164		96		73		80		413		9		422
2010
Continuing		169		92		50		69		380		11		391
Discontinued												3		3

(1)

Excludes property, plant and equipment acquired through acquisitions.

        The Company's net property, plant and equipment by geographic segment are as follows:

	U.S.		Non-U.S.		Total
2012	$	663	$	2,106	$	2,769
2011		667		2,210		2,877
2010		703		2,404		3,107

        The Company's net sales by geographic segment are as follows:

	U.S.		Non-U.S.		Total
2012	$	1,780	$	5,220	$	7,000
2011		1,776		5,582		7,358
2010		1,676		4,957		6,633

        Operations in individual countries outside the U.S. that accounted for more than 10% of consolidated net sales from continuing operations were in France (2012—11%, 2011—13%, 2010—13%), Australia (2012—10%, 2011—10%, 2010—11%) and Italy (2012—9%, 2011—10%, 2010—11%).