Segments

In the fourth quarter of 2015, we revised our reporting segments. Under the new structure, our U.S. and Canada glass tableware business is combined with our U.S. and Canada sourcing business in order to be consistent with the way we manage and report our other segments. Our reporting segments continue to align with our regionally focused organizational structure, which we believe enables us to better serve customers across the globe. We now report financial results for U.S. and Canada; Latin America; Europe, the Middle East and Africa (EMEA); and Other. Sales and segment EBIT continue to reflect end market reporting pursuant to which sales and related costs are included in segment EBIT based on the geographical destination of the sale. The revised 2015 segment results do not affect any previously reported consolidated financial results. Our three reportable segments are defined below. Our operating segment that does not meet the criteria to be a reportable segment is disclosed as Other.

U.S. & Canada—includes sales of manufactured and sourced tableware having an end market destination in the U.S and Canada excluding glass products for Original Equipment Manufacturers (OEM), which remain in the Latin America segment.

Latin America—includes primarily sales of manufactured and sourced glass tableware having an end market destination in Latin America including glass products for OEMs that have an end market destination outside of Latin America.

EMEA—includes primarily sales of manufactured and sourced glass tableware having an end market destination in Europe, the Middle East and Africa.

Other—includes primarily sales of manufactured and sourced glass tableware having an end market destination in Asia Pacific.

Our measure of profit for our reportable segments is Segment Earnings before Interest and Taxes (Segment EBIT) and excludes amounts related to certain items we consider not representative of ongoing operations as well as certain retained corporate costs and other allocations that are not considered by management when evaluating performance. 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 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.

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 at end market reporting below.



	Three months ended September 30,						Nine months ended September 30,
(dollars in thousands)	2016			2015			2016			2015
Net Sales:
U.S. & Canada	$	119,345		$	120,600		$	358,613		$	357,954
Latin America	40,149			42,372			114,988			126,838
EMEA	30,147			30,572			88,043			91,207
Other	7,232			8,240			25,938			27,201
Consolidated	$	196,873		$	201,784		$	587,582		$	603,200

Segment EBIT:
U.S. & Canada	$	19,501		$	20,842		$	57,740		$	57,017
Latin America	1,944			6,280			14,084			18,371
EMEA	(660		)	254			(1,702		)	1,274
Other	(379		)	905			898			3,851
Total Segment EBIT	$	20,406		$	28,281		$	71,020		$	80,513

Reconciliation of Segment EBIT to Net Income:
Segment EBIT	$	20,406		$	28,281		$	71,020		$	80,513
Retained corporate costs	(6,925		)	(7,969		)	(20,699		)	(26,626		)
Pension settlement	—			—			(212		)	—
Environmental obligation (note 13)	—			100			—			(123		)
Reorganization charges⁽¹⁾	—			(1,176		)	—			(4,191		)
Derivatives⁽²⁾	11			(42		)	1,150			125
Product portfolio optimization ⁽³⁾	—			—			(6,784		)	—
Executive terminations	98			—			(4,521		)	(235		)
Interest expense	(5,231		)	(4,701		)	(15,629		)	(13,762		)
(Provision) benefit for income taxes	(5,450		)	2,226			(12,003		)	(1,476		)
Net income	$	2,909		$	16,719		$	12,322		$	34,225

Depreciation & Amortization:
U.S. & Canada	$	2,883		$	3,010		$	9,718		$	8,789
Latin America	4,667			3,662			13,725			10,377
EMEA	1,885			2,131			7,660			6,445
Other	1,325			1,462			4,162			4,434
Corporate	474			368			1,404			1,241
Consolidated	$	11,234		$	10,633		$	36,669		$	31,286

Capital Expenditures:
U.S. & Canada	$	3,037		$	2,666		$	9,030		$	23,434
Latin America	2,041			3,160			5,717			11,170
EMEA	1,549			1,726			4,656			4,501
Other	939			451			2,529			991
Corporate	446			241			1,591			1,384
Consolidated	$	8,012		$	8,244		$	23,523		$	41,480

________________________

⁽¹⁾Management reorganization to support our growth strategy.

⁽²⁾Derivatives relate to hedge ineffectiveness on our natural gas contracts, as well as, mark-to-market adjustments on our natural gas contracts that have been de-designated and those for which we did not elect hedge accounting.

⁽³⁾ Product portfolio optimization relates to inventory reductions to simplify and improve our operations.