Special Charges

9 Months Ended

Sep. 30, 2011

Special Charges [Abstract]

Special Charges

Special Charges

Facility Closures

In December 2008, we announced that our Syracuse China manufacturing facility and our Mira Loma, California distribution center would be shut down in early to mid-2009 in order to reduce costs. The Syracuse China facility was closed on April 9, 2009 and the Mira Loma distribution center was closed on May 31, 2009. See Form 10-K for the year ended December 31, 2010 for further discussion.

We incurred no additional charges for the three months ended September 30, 2011. We incurred charges of approximately $0.1 million in the nine months ended September 30, 2011 related to other costs net of building site clean-up adjustments in connection with the sale of the property in Syracuse, New York in March 2011. This amount was included in special charges on the Condensed Consolidated Statement of Operations in the Other Operations segment as detailed in the table below.

There were no additional charges related to these closures in the three months ended September 30, 2010. We incurred additional charges of approximately $0.5 million in the nine months ended September 30, 2010 related to these closures, including charges of $0.4 million primarily related to employee termination and building site cleanup costs. These amounts were included in special charges on the Condensed Consolidated Statement of Operations in the Glass Operations and Other Operations segment as detailed in the table below.

Other income on the Condensed Consolidated Statement of Operations included a charge of immaterial amounts for the three months ended September 30, 2010, and a charge of $0.1 million for the first nine months of 2010 for the change in fair value of ineffective natural gas hedges related to our Syracuse China operation. These amounts were included in the Other Operations segment.

The following table summarizes the facility closure charges in the first nine months of 2011 and 2010:

	Nine months ended September 30, 2011								Nine months ended September 30, 2010
(dollars in thousands)	Glass Operations		Other Operations			Total			Glass Operations		Other Operations			Total
Employee termination cost & other	$	—	$	167		$	167		$	29	$	76		$	105
Building site clean-up & fixed asset write-down	—		(116		)	(116		)	—		283			283
Included in special charges	—		51			51			29		359			388
Ineffectiveness of natural gas hedge	—		—			—			—		(130		)	(130		)
Included in other (expense) income	—		—			—			—		(130		)	(130		)
Total pretax charge	$	—	$	51		$	51		$	29	$	489		$	518

The following reflects the balance sheet activity related to the facility closure charge for the period ended September 30, 2011:

	Balances at December 31, 2010		Total Charge to Earnings			Cash (payments) receipts			Inventory & Fixed asset Write Downs		Non-cash Utilization			Balances at September 30, 2011
(dollars in thousands)
Building site clean-up & fixed asset write-down	$	151	$	(116	)	$	(5	)	$	21	$	(51	)	$	—
Employee termination cost & other	301		167			(314		)	—		(154		)	—
Total	$	452	$	51		$	(319	)	$	21	$	(205	)	$	—

The activities related to our closure of the Syracuse China manufacturing facility and our Mira Loma, California distribution center are complete. The following reflects the total cumulative expenses to date (incurred from the fourth quarter of 2008 through the Balance Sheet date) related to the facility closure activity:

(dollars in thousands)	Glass Operations		Other Operations		Charges To Date
Inventory write-down	$	192	$	10,541	$	10,733
Pension & postretirement welfare	—		4,448		4,448
Fixed asset depreciation	—		966		966
Included in cost of sales	192		15,955		16,147
Employee termination cost & other	548		6,149		6,697
Building site clean-up & fixed asset write-down	177		10,418		10,595
Included in special charges	725		16,567		17,292
Ineffectiveness of natural gas hedge	—		745		745
Included in other (income) expense	—		745		745
Total pretax charge to date	$	917	$	33,267	$	34,184

Fixed Asset and Inventory Write-down

In August 2010, we wrote down decorating assets in our Shreveport, Louisiana facility as a result of our decision to outsource our U.S. decorating business. See Form 10-K for the year ended December 31, 2010 for further discussion.

During the three months and nine months ended September 30, 2011, we recorded a $0.2 million and $0.3 million income adjustment, respectively, to special charges on the Condensed Consolidated Statement of Operations in the Glass Operations segment. In the three months and nine months ended September 30, 2011, we recorded charges of $0.2 million and $0.2 million, respectively, to write down inventory and spare machine parts. These amounts were included in cost of sales on the Condensed Consolidated Statement of Operations in the Glass Operations segment.

In the third quarter of 2010, we recorded a charge of $0.6 million to write down inventory and spare machine parts. This amount was included in cost of sales on the Condensed Consolidated Statement of Operations in the Glass Operations segment. Charges of $0.7 million were recorded in the third quarter of 2010 for site cleanup and fixed assets write down. This amount was included in special charges on the Condensed Consolidated Statement of Operations in the Glass Operations segment. No employee related costs were incurred, as all employees were reassigned in the facility.

The following reflects the balance sheet activity related to the fixed asset and inventory write-down charge as of September 30, 2011:

	Reserve Balances at December 31, 2010		Total Charge to Earnings			Cash (payments) receipts			Inventory & Fixed asset Write Downs			Reserve Balances at September 30, 2011
(Dollars in thousands)
Building site clean-up & fixed asset write-down	$	316	$	(135	)	$	(39	)	$	(142	)	$	—
Total	$	316	$	(135	)	$	(39	)	$	(142	)	$	—

The activities related to our write-down of decorating fixed assets and inventory are complete.

During the second quarter of 2010, we wrote down certain after-processing equipment within our Glass Operations segment. The non-cash charge of $2.7 million was included in cost of sales on the Condensed Consolidated Statement of Operations. During the second quarter of 2011, we received a $1.0 million credit from the supplier of this equipment. This was recorded in selling, general and administrative expense and other income on the Condensed Consolidated Statements of Operations.

Summary of Total Special Charges

The following table summarizes the special charges mentioned above and their classifications in the Condensed Consolidated Statements of Operations:

	Three months ended September 30,					Nine months ended September 30,
(dollars in thousands)	2011			2010		2011			2010
Cost of sales	$	154		$	578	$	197		$	3,265
Selling general & administrative	—			—		(805		)	—
Special charges (income)	(232		)	700		(281		)	1,088
Other (income) expense	—			—		(216		)	130
Total (income) expense	$	(78	)	$	1,278	$	(1,105	)	$	4,483