Segments

We have revised our segment structure to reflect our reorganization from geographical regions to one global company. Under this new structure, we have two reportable segments: Glass Operations and Other Operations. The classifications are defined as follows:

Glass Operations — includes worldwide sales of glass tableware and other glass products from domestic and international subsidiaries.

Other Operations — includes worldwide sales of ceramic dinnerware, metal tableware, hollowware and serveware and plastic items. Plastic items were sold through April 28, 2011.

Our measure of profit for our reportable segments is Segment Earnings before Interest and Taxes (EBIT) and excludes amounts related to certain items we consider not representative of ongoing operations as well as certain retained corporate costs. 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 both a percentage of sales and direct billings 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. Corporate assets primarily include finance fees, capitalized software, and income tax assets.

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 in eliminations below.



	Three months ended September 30,						Nine months ended September 30,
(dollars in thousands)	2011			2010			2011			2010
Net Sales:
Glass Operations	$	190,813		$	180,225		$	547,353		$	516,184
Other Operations	16,597			19,953			55,448			61,203
Eliminations	(164		)	(171		)	(527		)	(440		)
Consolidated	$	207,246		$	200,007		$	602,274		$	576,947
Segment EBIT:
Glass Operations	$	29,801		$	24,928		$	77,165		$	71,542
Other Operations	2,978			2,772			9,619			11,011
Total Segment EBIT	$	32,779		$	27,700		$	86,784		$	82,553
Reconciliation of Segment EBIT to Net Income:
Segment EBIT	$	32,779		$	27,700		$	86,784		$	82,553
Retained corporate costs	(10,071		)	(9,653		)	(29,974		)	(27,376		)
(Loss) gain on redemption of debt (note 4)	—			—			(2,803		)	56,792
(Expense) gain on sale of Traex assets	(81		)	—			3,240			—
Gain on sale of land ⁽¹⁾	—			—			3,445			—
Restructuring and other charges (note 5)	78			(1,278		)	1,105			(4,483		)
Other special charges ⁽²⁾	(2,091		)	(1,096		)	(2,511		)	(151		)
Interest expense	(10,559		)	(11,855		)	(32,929		)	(33,243		)
Income taxes	(2,928		)	(1,472		)	(4,825		)	(6,769		)
Net income	$	7,127		$	2,346		$	21,532		$	67,323
Depreciation & Amortization:
Glass Operations	$	9,999		$	9,517		$	30,779		$	29,386
Other Operations	11			178			257			549
Corporate	347			345			1,229			1,059
Consolidated	$	10,357		$	10,040		$	32,265		$	30,994
Capital Expenditures:
Glass Operations	$	7,511		$	6,466		$	25,280		$	17,267
Other Operations	12			62			15			76
Corporate	536			1,215			1,162			1,779
Consolidated	$	8,059		$	7,743		$	26,457		$	19,122



(dollars in thousands)	September 30, 2011		December 31, 2010
Segment Assets:
Glass Operations	$	732,759	$	752,058
Other Operations	35,762		45,944
Corporate	19,806		20,969
Consolidated	$	788,327	$	818,971

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(1)	Net gain on the sale of land at our Royal Leerdam facility.

(2)

The three month period ended September 30, 2011 represents CEO transition expenses, primarily non-cash charges related to accelerated vesting of previously issued equity compensation. The nine month period ended September 30, 2011 represents CEO transition expenses including $1.7 million of non-cash charges related to accelerated vesting of previously issued equity compensation, $0.4 million of relocation expenses and $0.4 million of other fees. The three month period ending September 30, 2010 represents equity offering fees related to the secondary stock offering with the nine month period offset by an insurance claim recovery.