Pension (Tables)

12 Months Ended

Dec. 31, 2012

Defined Benefit Plan Disclosure [Line Items]

Sensitivity Analysis of Impact of Changes in Significant Assumptions

Considering 2012 results, the disclosure below provides a sensitivity analysis of the impact that changes in the significant assumptions would have on 2012 and 2013 pension expense:

Assumption (dollars in thousands)		Estimated Effect on Annual Expense
	Percentage Point Change	2012		2013
Discount rate	1.0%	$	4,000	$	4,100
Long-term rate of return on assets	1.0%	$	2,400	$	3,400

Schedule of Changes in Projected Benefit Obligation and Fair Value of Plan Assets

The changes in the projected benefit obligations and fair value of plan assets are as follows:

Year ended December 31, (dollars in thousands)	U.S. Plans						Non-U.S. Plans						Total
	2012			2011			2012			2011			2012			2011
Change in projected benefit obligation:
Projected benefit obligation, beginning of year	$	315,689		$	289,725		$	68,990		$	73,328		$	384,679		$	363,053
Service Cost	5,957			5,491			1,749			1,553			7,706			7,044
Interest cost	15,398			16,057			4,954			4,981			20,352			21,038
Exchange rate fluctuations	—			—			3,727			(5,044		)	3,727			(5,044		)
Actuarial (gain) loss	34,426			18,499			20,223			(2,499		)	54,649			16,000
Plan participants' contributions	—			—			1,087			1,184			1,087			1,184
Plan amendments	—			—			—			(499		)	—			(499		)
Curtailment charge	(5,711		)	—			—			—			(5,711		)	—
Settlement charge	(275		)	—			—			—			(275		)	—
Benefits paid	(27,351		)	(14,083		)	(5,271		)	(4,014		)	(32,622		)	(18,097		)
Projected benefit obligation, end of year	$	338,133		$	315,689		$	95,459		$	68,990		$	433,592		$	384,679
Change in fair value of plan assets:
Fair value of plan assets, beginning of year	$	221,025		$	206,087		$	53,004		$	51,882		$	274,029		$	257,969
Actual return on plan assets	30,348			7,041			5,922			358			36,270			7,399
Exchange rate fluctuations	—			—			1,323			(1,361		)	1,323			(1,361		)
Employer contributions	92,804			21,980			9,375			4,955			102,179			26,935
Plan participants' contributions	—			—			1,087			1,184			1,087			1,184
Settlements paid	(12,552		)	—			(692		)	(728		)	(13,244		)	(728		)
Benefits paid	(14,799		)	(14,083		)	(4,579		)	(3,286		)	(19,378		)	(17,369		)
Fair value of plan assets, end of year	$	316,826		$	221,025		$	65,440		$	53,004		$	382,266		$	274,029
Funded ratio	93.7		%	70.0		%	68.6		%	76.8		%	88.2		%	71.2		%
Funded status and net accrued pension benefit cost	$	(21,307	)	$	(94,664	)	$	(30,019	)	$	(15,986	)	$	(51,326	)	$	(110,650	)

Estimated Contributions to Defined Benefit Plan

Estimated contributions for 2013, as well as, contributions made in 2012 and 2011 to the pension plans are as follows:

(dollars in thousands)	U.S. Plans		Non-U.S. Plans		Total
Estimated contributions in 2013	$	74	$	3,329	$	3,403
Contributions made in 2012	$	92,804	$	9,375	$	102,179
Contributions made in 2011	$	21,980	$	4,955	$	26,935

Accumulated Benefit Obligation in Excess of Fair Value of Plan Assets

The projected benefit obligation, accumulated benefit obligation and fair value of plan assets for pension plans with an accumulated benefit obligation in excess of plan assets at December 31, 2012 and 2011 were as follows:

December 31, (dollars in thousands)	U.S. Plans				Non-U.S. Plans				Total
	2012		2011		2012		2011		2012		2011
Projected benefit obligation	$	338,133	$	315,689	$	43,190	$	33,471	$	381,323	$	349,160
Accumulated benefit obligation	$	338,133	$	310,920	$	38,387	$	29,424	$	376,520	$	340,344
Fair value of plan assets	$	316,826	$	221,025	$	2,974	$	—	$	319,800	$	221,025

Plan Asset Allocation

The asset allocation for our U.S. pension plans at the end of 2012 and 2011 and the target allocation for 2013, by asset category, are as follows:

	Target Allocation		Percent of Plan Assets at Year End
U.S. Plans Asset Category	2013		2012		2011
Equity securities	45	%	44	%	47	%
Debt securities	35	%	37	%	33	%
Real estate	5	%	5	%	5	%
Other	15	%	14	%	15	%
Total	100	%	100	%	100	%

The asset allocation for our Libbey Holland pension plan at the end of 2012 and 2011 and the target allocation for 2013, by asset category, are as follows:

	Target Allocation		Percent of Plan Assets at Year End
Non-U.S. Plan Asset Category	2013		2012		2011
Equity securities	18	%	17	%	19	%
Debt securities	68	%	68	%	64	%
Real estate	9	%	10	%	11	%
Other	5	%	5	%	6	%
Total	100	%	100	%	100	%

The following table sets forth by level, within the fair value hierarchy established by FASB ASC Topic 820, our pension plan assets at fair value (see note 15 for further discussion of the fair value hierarchy) as of December 31, 2012 and 2011:

December 31, 2012 (dollars in thousands)
	Level One		Level Two		Level Three		Total
Cash & cash equivalents	$	—	$	781	$	—	$	781
Real estate	—		15,613		6,305		21,918
Equity securities	—		149,902		—		149,902
Debt securities	—		162,114		—		162,114
Hedge funds	—		—		47,551		47,551
Total	$	—	$	328,410	$	53,856	$	382,266

December 31, 2011 (dollars in thousands)
	Level One		Level Two		Level Three		Total
Cash & cash equivalents	$	—	$	3,550	$	—	$	3,550
Real estate	—		11,163		5,982		17,145
Equity securities	—		113,400		—		113,400
Debt securities	—		106,955		—		106,955
Hedge funds	—		—		32,979		32,979
Total	$	—	$	235,068	$	38,961	$	274,029

Reconciliation of Level 3 Inputs on Changes in Pension Plan Assets

The change in fair value of Level 3 pension plan assets due to actual return on those assets was immaterial in 2012 and 2011. The following is a reconciliation for which Level three inputs were used in determining fair value:

Year ended December 31, (dollars in thousands)	2012		2011
Assets classified as Level 3 at the beginning of the year	$	38,961	$	35,989
Change in unrealized appreciation (depreciation)	2,743		(1,621		)
Net purchases	12,152		4,593
Assets classified as Level 3 at the end of the year	$	53,856	$	38,961

Defined Benefit Pension Plans and SERP

Defined Benefit Plan Disclosure [Line Items]

Components of Net Benefit Costs

The components of our net pension expense, including the SERP, are as follows:

Year ended December 31, (dollars in thousands)	U.S. Plans									Non-U.S. Plans									Total
	2012			2011			2010			2012			2011			2010			2012			2011			2010
Service cost (benefits earned during the period)	$	5,957		$	5,491		$	5,341		$	1,749		$	1,553		$	1,603		$	7,706		$	7,044		$	6,944
Interest cost on projected benefit obligation	15,398			16,057			15,896			4,954			4,981			4,557			20,352			21,038			20,453
Expected return on plan assets	(18,514		)	(17,173		)	(16,683		)	(2,382		)	(2,299		)	(2,463		)	(20,896		)	(19,472		)	(19,146		)
Amortization of unrecognized:
Prior service cost	2,050			2,163			2,328			159			172			2			2,209			2,335			2,330
Actuarial loss	6,429			4,661			3,621			533			493			417			6,962			5,154			4,038
Transition obligations	—			—			—			102			125			122			102			125			122
Settlement charge	3,931			—			—			200			58			47			4,131			58			47
Curtailment charge	375			—			—			—			—			—			375			—			—
Pension expense	$	15,626		$	11,199		$	10,503		$	5,315		$	5,083		$	4,285		$	20,941		$	16,282		$	14,788

Schedule of Assumptions Used

The assumptions used to determine the benefit obligations were as follows:

	U.S. Plans						Non-U.S. Plans
	2012			2011			2012			2011
Discount rate	3.98%	to	4.22%	5.00%	to	5.22%	3.70%	to	7.00%	5.80%	to	8.25%
Rate of compensation increase	—%	to	—%	2.25%	to	4.50%	2.00%	to	4.30%	2.00%	to	4.30%

The assumptions used to determine net periodic pension costs were as follows:

	U.S. Plans															Non-U.S. Plans
	2012					2011					2010					2012					2011					2010
Discount rate	3.87	%	to	5.22	%	5.50	%	to	5.76	%	5.62	%	to	5.96	%	5.80	%	to	8.25	%	5.40	%	to	8.25	%	5.50	%	to	8.50	%
Expected long-term rate of return on plan assets	7.75%					8.00%					8.00%					5.10%					4.80%					5.75%
Rate of compensation increase	2.25	%	to	4.50	%	2.25	%	to	4.50	%	2.25	%	to	4.50	%	2.00	%	to	4.30	%	2.00	%	to	4.30	%	2.00	%	to	4.30	%

Net Accrued Benefit Liability

The net accrued pension benefit liability at December 31 of the respective year-ends were included in the Consolidated Balance Sheets as follows:

December 31, (dollars in thousands)	2012			2011
Non-current asset	$	10,196		$	17,485
Current liability	(613		)	(5,990		)
Long-term liability	(60,909		)	(122,145		)
Net accrued pension liability	$	(51,326	)	$	(110,650	)

Amounts Recognized in Accumulated Other Comprehensive Loss

The pre-tax amounts recognized in accumulated other comprehensive loss as of December 31, 2012 and 2011, are as follows:

Year ended December 31, (dollars in thousands)	U.S. Plans				Non-U.S. Plans				Total
	2012		2011		2012		2011		2012		2011
Net actuarial loss	$	117,573	$	111,328	$	23,576	$	6,721	$	141,149	$	118,049
Prior service cost	3,148		5,572		1,194		1,325		4,342		6,897
Transition obligation	—		—		143		229		143		229
Total cost	$	120,721	$	116,900	$	24,913	$	8,275	$	145,634	$	125,175

Amounts in Accumulated Other Comprehensive Loss to be Recognized During 2013

The pre-tax amounts in accumulated other comprehensive loss as of December 31, 2012, that are expected to be recognized as components of net periodic benefit cost during 2013 are as follows:

(dollars in thousands)	U.S. Plans		Non-U.S. Plans		Total
Net actuarial loss	$	8,346	$	902	$	9,248
Prior service cost	1,172		163		1,335
Transition obligation	—		82		82
Total cost	$	9,518	$	1,147	$	10,665

Anticipated Benefit Payments

Pension benefit payment amounts are anticipated to be paid from the plans (including the SERP) as follows:

Year (dollars in thousands)	U.S. Plans		Non-U.S. Plans		Total
2013	$	19,131	$	3,780	$	22,911
2014	$	19,488	$	2,617	$	22,105
2015	$	20,091	$	2,931	$	23,022
2016	$	20,408	$	3,458	$	23,866
2017	$	20,739	$	3,909	$	24,648
2018-2022	$	110,430	$	23,945	$	134,375