Condensed Consolidated Guarantor Financial Statements

Libbey Glass is a direct, 100 percent owned subsidiary of Libbey Inc. and is the issuer of the Senior Secured Notes. The obligations of Libbey Glass under the Senior Secured Notes are fully and unconditionally and jointly and severally guaranteed by Libbey Inc. and by certain indirect, 100 percent owned domestic subsidiaries of Libbey Inc., as described below. All are related parties that are included in the Consolidated Financial Statements for the year ended December 31, 2013, 2012 and 2011.

At December 31, 2013, December 31, 2012 and December 31, 2011, Libbey Inc.’s indirect, 100 percent owned domestic subsidiaries were Syracuse China Company, World Tableware Inc., LGA4 Corp., LGA3 Corp., The Drummond Glass Company, LGC Corp., Dane Holding Co. (dissolved in June of 2012 and known as Traex Company prior to April 28, 2011), Libbey.com LLC, LGFS Inc., and LGAC LLC (collectively, Subsidiary Guarantors). The following tables contain Condensed Consolidating Financial Statements of (a) the parent, Libbey Inc., (b) the issuer, Libbey Glass, (c) the Subsidiary Guarantors, (d) the indirect subsidiaries of Libbey Inc. that are not Subsidiary Guarantors (collectively, Non-Guarantor Subsidiaries), (e) the consolidating elimination entries, and (f) the consolidated totals.

Libbey Inc.

Condensed Consolidating Statement of Comprehensive Income (Loss)



	Year ended December 31, 2013
(dollars in thousands)	Libbey Inc. (Parent)		Libbey Glass (Issuer)			Subsidiary Guarantors			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net sales	$	—	$	394,849		$	82,458		$	408,454		$	(66,950	)	$	818,811
Freight billed to customers	—		578			848			1,918			—			3,344
Total revenues	—		395,427			83,306			410,372			(66,950		)	822,155
Cost of sales	—		296,672			62,356			342,738			(66,950		)	634,816
Gross profit	—		98,755			20,950			67,634			—			187,339
Selling, general and administrative expenses	—		58,428			10,737			40,816			—			109,981
Special charges	—		4,841			—			18			—			4,859
Income (loss) from operations	—		35,486			10,213			26,800			—			72,499
Other income (expense)	—		1,385			(20		)	(158		)	—			1,207
Earnings (loss) before interest and income taxes	—		36,871			10,193			26,642			—			73,706
Interest expense	—		23,852			—			8,154			—			32,006
Income (loss) before income taxes	—		13,019			10,193			18,488			—			41,700
Provision (benefit) for income taxes	—		(1,401		)	3,578			11,064			—			13,241
Net income (loss)	—		14,420			6,615			7,424			—			28,459
Equity in net income (loss) of subsidiaries	28,459		14,039			—			—			(42,498		)	—
Net income (loss)	$	28,459	$	28,459		$	6,615		$	7,424		$	(42,498	)	$	28,459

Comprehensive income (loss)	$	96,339	$	96,339		$	10,062		$	9,613		$	(116,014	)	$	96,339

Libbey Inc.

Condensed Consolidating Statements of Comprehensive Income (Loss)



	Year ended December 31, 2012
(dollars in thousands)	Libbey Inc. (Parent)			Libbey Glass (Issuer)			Subsidiary Guarantors		Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net sales	$	—		$	421,630		$	76,231	$	397,811		$	(70,385	)	$	825,287
Freight billed to customers	—			579			701		1,885			—			3,165
Total revenues	—			422,209			76,932		399,696			(70,385		)	828,452
Cost of sales	—			320,175			55,787		327,690			(70,385		)	633,267
Gross profit	—			102,034			21,145		72,006			—			195,185
Selling, general and administrative expenses	—			71,162			8,829		33,905			—			113,896
Special charges	—			—			—		—			—			—
Income (loss) from operations	—			30,872			12,316		38,101			—			81,289
Other income (expense)	—			(30,796		)	9		(100		)	—			(30,887		)
Earnings (loss) before interest and income taxes	—			76			12,325		38,001			—			50,402
Interest expense	—			29,430			—		8,297			—			37,727
Income (loss) before income taxes	—			(29,354		)	12,325		29,704			—			12,675
Provision (benefit) for income taxes	—			(4,013		)	5,185		4,537			—			5,709
Net income (loss)	—			(25,341		)	7,140		25,167			—			6,966
Equity in net income (loss) of subsidiaries	6,966			32,307			—		—			(39,273		)	—
Net income (loss)	$	6,966		$	6,966		$	7,140	$	25,167		$	(39,273	)	$	6,966

Comprehensive income (loss)	$	(5,702	)	$	(5,702	)	$	7,366	$	14,155		$	(15,819	)	$	(5,702	)



	Year ended December 31, 2011
(dollars in thousands)	Libbey Inc. (Parent)		Libbey Glass (Issuer)			Subsidiary Guarantors		Non- Guarantor Subsidiaries		Eliminations			Consolidated
Net sales	$	—	$	408,561		$	74,260	$	404,567	$	(70,332	)	$	817,056
Freight billed to customers	—		630			929		837		—			2,396
Total revenues	—		409,191			75,189		405,404		(70,332		)	819,452
Cost of sales	—		336,027			55,455		329,563		(70,332		)	650,713
Gross profit	—		73,164			19,734		75,841		—			168,739
Selling, general and administrative expenses	—		60,211			7,816		37,518		—			105,545
Special charges	—		(332		)	51		—		—			(281		)
Income (loss) from operations	—		13,285			11,867		38,323		—			63,475
Other income (expense)	—		(2,560		)	3,457		4,331		—			5,228
Earnings (loss) before interest and income taxes	—		10,725			15,324		42,654		—			68,703
Interest expense	—		32,711			—		10,708		—			43,419
Income (loss) before income taxes	—		(21,986		)	15,324		31,946		—			25,284
Provision (benefit) for income taxes	—		(3,811		)	4,016		1,438		—			1,643
Net income (loss)	—		(18,175		)	11,308		30,508		—			23,641
Equity in net income (loss) of subsidiaries	23,641		41,816			—		—		(65,457		)	—
Net income (loss)	$	23,641	$	23,641		$	11,308	$	30,508	$	(65,457	)	$	23,641

Comprehensive income (loss)	$	6,215	$	6,215		$	8,756	$	30,971	$	(45,942	)	$	6,215

Libbey Inc.

Condensed Consolidating Balance Sheet



	December 31, 2013
(dollars in thousands)	Libbey Inc. (Parent)		Libbey Glass (Issuer)		Subsidiary Guarantors		Non- Guarantor Subsidiaries			Eliminations			Consolidated
Cash and equivalents	$	—	$	22,070	$	62	$	20,076		$	—		$	42,208
Accounts receivable — net	—		41,193		4,562		48,794			—			94,549
Inventories — net	—		51,571		22,907		88,643			—			163,121
Other current assets	—		23,183		3,999		18,751			(21,095		)	24,838
Total current assets	—		138,017		31,530		176,264			(21,095		)	324,716
Other non-current assets	—		38,661		1,379		13,475			(607		)	52,908
Investments in and advances to subsidiaries	130,809		304,266		199,573		(41,361		)	(593,287		)	—
Goodwill and purchased intangible assets — net	—		27,423		12,347		146,934			—			186,704
Total other assets	130,809		370,350		213,299		119,048			(593,894		)	239,612
Property, plant and equipment — net	—		67,836		278		197,548			—			265,662
Total assets	$	130,809	$	576,203	$	245,107	$	492,860		$	(614,989	)	$	829,990

Accounts payable	$	—	$	16,086	$	3,404	$	60,130		$	—		$	79,620
Accrued and other current liabilities	—		50,292		26,243		27,674			(21,095		)	83,114
Notes payable and long-term debt due within one year	—		235		—		5,156			—			5,391
Total current liabilities	—		66,613		29,647		92,960			(21,095		)	168,125
Long-term debt	—		404,122		—		2,390			—			406,512
Other long-term liabilities	—		67,225		8,205		49,721			(607		)	124,544
Total liabilities	—		537,960		37,852		145,071			(21,702		)	699,181
Total shareholders’ equity	130,809		38,243		207,255		347,789			(593,287		)	130,809
Total liabilities and shareholders’ equity	$	130,809	$	576,203	$	245,107	$	492,860		$	(614,989	)	$	829,990

Libbey Inc.

Condensed Consolidating Balance Sheet



	December 31, 2012
(dollars in thousands)	Libbey Inc. (Parent)		Libbey Glass (Issuer)		Subsidiary Guarantors		Non- Guarantor Subsidiaries			Eliminations			Consolidated
Cash and equivalents	$	—	$	43,558	$	70	$	23,580		$	—		$	67,208
Accounts receivable — net	—		33,987		3,560		43,303			—			80,850
Inventories — net	—		52,627		18,477		86,445			—			157,549
Other current assets	—		17,931		810		10,446			(16,190		)	12,997
Total current assets	—		148,103		22,917		163,774			(16,190		)	318,604
Other non-current assets	—		22,373		54		20,387			(4,190		)	38,624
Investments in and advances to subsidiaries	24,476		384,414		194,316		(35,962		)	(567,244		)	—
Goodwill and purchased intangible assets — net	—		26,833		12,347		147,614			—			186,794
Total other assets	24,476		433,620		206,717		132,039			(571,434		)	225,418
Property, plant and equipment — net	—		72,780		298		185,076			—			258,154
Total assets	$	24,476	$	654,503	$	229,932	$	480,889		$	(587,624	)	$	802,176

Accounts payable	$	—	$	15,339	$	2,854	$	47,519		$	—		$	65,712
Accrued and other current liabilities	—		63,674		20,194		27,857			(16,190		)	95,535
Notes payable and long-term debt due within one year	—		221		—		4,362			—			4,583
Total current liabilities	—		79,234		23,048		79,738			(16,190		)	165,830
Long-term debt	—		451,090		—		10,794			—			461,884
Other long-term liabilities	—		94,434		9,691		50,051			(4,190		)	149,986
Total liabilities	—		624,758		32,739		140,583			(20,380		)	777,700
Total shareholders’ equity	24,476		29,745		197,193		340,306			(567,244		)	24,476
Total liabilities and shareholders’ equity	$	24,476	$	654,503	$	229,932	$	480,889		$	(587,624	)	$	802,176

Libbey Inc.

Condensed Consolidating Statements of Cash Flows



	Year ended December 31, 2013
(dollars in thousands)	Libbey Inc. (Parent)			Libbey Glass (Issuer)			Subsidiary Guarantors			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net income (loss)	$	28,459		$	28,459		$	6,615		$	7,424		$	(42,498	)	$	28,459
Depreciation and amortization	—			13,888			56			30,025			—			43,969
Other operating activities	(28,459		)	(10,915		)	(6,644		)	3,821			42,498			301
Net cash provided by (used in) operating activities	—			31,432			27			41,270			—			72,729
Additions to property, plant & equipment	—			(11,735		)	(35		)	(37,637		)	—			(49,407		)
Other investing activities	—			2			—			79			—			81
Net cash (used in) investing activities	—			(11,733		)	(35		)	(37,558		)	—			(49,326		)
Net borrowings (repayments)	—			(45,221		)	—			(7,955		)	—			(53,176		)
Other financing activities	—			4,034			—			—			—			4,034
Net cash provided by (used in) financing activities	—			(41,187		)	—			(7,955		)	—			(49,142		)
Exchange effect on cash	—			—			—			739			—			739
Increase (decrease) in cash	—			(21,488		)	(8		)	(3,504		)	—			(25,000		)
Cash at beginning of period	—			43,558			70			23,580			—			67,208
Cash at end of period	$	—		$	22,070		$	62		$	20,076		$	—		$	42,208



	Year ended December 31, 2012
(dollars in thousands)	Libbey Inc. (Parent)			Libbey Glass (Issuer)			Subsidiary Guarantors			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net income (loss)	$	6,966		$	6,966		$	7,140		$	25,167		$	(39,273	)	$	6,966
Depreciation and amortization	—			12,897			70			28,504			—			41,471
Other operating activities	(6,966		)	(59,493		)	(7,295		)	(5,459		)	39,273			(39,940		)
Net cash provided by (used in) operating activities	—			(39,630		)	(85		)	48,212			—			8,497
Additions to property, plant & equipment	—			(10,104		)	—			(22,616		)	—			(32,720		)
Other investing activities	—			97			—			550			—			647
Net cash (used in) investing activities	—			(10,007		)	—			(22,066		)	—			(32,073		)
Net borrowings (repayments)	—			89,792			—			(21,674		)	—			68,118
Other financing activities	—			(35,846		)	—			—			—			(35,846		)
Net cash provided by (used in) financing activities	—			53,946			—			(21,674		)	—			32,272
Exchange effect on cash	—			—			—			221			—			221
Increase (decrease) in cash	—			4,309			(85		)	4,693			—			8,917
Cash at beginning of period	—			39,249			155			18,887			—			58,291
Cash at end of period	$	—		$	43,558		$	70		$	23,580		$	—		$	67,208

Libbey Inc.

Condensed Consolidating Statement of Cash Flows



	Year ended December 31, 2011
(dollars in thousands)	Libbey Inc. (Parent)			Libbey Glass (Issuer)			Subsidiary Guarantors			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net income (loss)	$	23,641		$	23,641		$	11,308		$	30,508		$	(65,457	)	$	23,641
Depreciation and amortization	—			13,501			292			28,395			—			42,188
Other operating activities	(23,641		)	(2,184		)	(24,655		)	(25,455		)	65,457			(10,478		)
Net cash provided by (used in) operating activities	—			34,958			(13,055		)	33,448			—			55,351
Additions to property, plant & equipment	—			(18,098		)	(61		)	(23,261		)	—			(41,420		)
Other investing activities	—			33			12,978			4,689			—			17,700
Net cash (used in) investing activities	—			(18,065		)	12,917			(18,572		)	—			(23,720		)
Net borrowings (repayments)	—			(40,196		)	—			(13,547		)	—			(53,743		)
Other financing activities	—			4,275			—			—			—			4,275
Net cash provided by (used in) financing activities	—			(35,921		)	—			(13,547		)	—			(49,468		)
Exchange effect on cash	—			—			—			(130		)	—			(130		)
Increase (decrease) in cash	—			(19,028		)	(138		)	1,199			—			(17,967		)
Cash at beginning of period	—			58,277			293			17,688			—			76,258
Cash at end of period	$	—		$	39,249		$	155		$	18,887		$	—		$	58,291