þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 34-1559357 | |
(State or other jurisdiction of incorporation or organization) | (IRS Employer Identification No.) |
300 Madison Avenue, Toledo, Ohio 43604 | ||
(Address of principal executive offices) (Zip Code) | ||
419-325-2100 | ||
(Registrant’s telephone number, including area code) |
Large Accelerated Filer | o | Accelerated Filer | þ | |||
Non-Accelerated Filer | o | (Do not check if a smaller reporting company) | Smaller reporting company | o | ||
Emerging growth company | o |
EX-31.1 | |
EX-31.2 | |
EX-32.1 | |
EX-101 INSTANCE DOCUMENT | |
EX-101 SCHEMA DOCUMENT | |
EX-101 CALCULATION LINKBASE DOCUMENT | |
EX-101 LABELS LINKBASE DOCUMENT | |
EX-101 PRESENTATION LINKBASE DOCUMENT | |
EX-101 DEFINITION LINKBASE DOCUMENT |
Item 1. | Financial Statements |
Three months ended September 30, | |||||||
2017 | 2016 | ||||||
Net sales | $ | 187,339 | $ | 196,873 | |||
Freight billed to customers | 1,058 | 703 | |||||
Total revenues | 188,397 | 197,576 | |||||
Cost of sales | 151,202 | 155,694 | |||||
Gross profit | 37,195 | 41,882 | |||||
Selling, general and administrative expenses | 29,082 | 28,540 | |||||
Goodwill impairment | 79,700 | — | |||||
Income (loss) from operations | (71,587 | ) | 13,342 | ||||
Other income | 621 | 248 | |||||
Earnings (loss) before interest and income taxes | (70,966 | ) | 13,590 | ||||
Interest expense | 5,118 | 5,231 | |||||
Income (loss) before income taxes | (76,084 | ) | 8,359 | ||||
Provision for income taxes | 2,731 | 5,450 | |||||
Net income (loss) | $ | (78,815 | ) | $ | 2,909 | ||
Net income (loss) per share: | |||||||
Basic | $ | (3.57 | ) | $ | 0.13 | ||
Diluted | $ | (3.57 | ) | $ | 0.13 | ||
Dividends declared per share | $ | 0.1175 | $ | 0.1150 |
Nine months ended September 30, | |||||||
2017 | 2016 | ||||||
Net sales | $ | 557,847 | $ | 587,582 | |||
Freight billed to customers | 2,481 | 1,983 | |||||
Total revenues | 560,328 | 589,565 | |||||
Cost of sales | 452,041 | 457,298 | |||||
Gross profit | 108,287 | 132,267 | |||||
Selling, general and administrative expenses | 95,733 | 93,348 | |||||
Goodwill impairment | 79,700 | — | |||||
Income (loss) from operations | (67,146 | ) | 38,919 | ||||
Other income (expense) | (2,283 | ) | 1,035 | ||||
Earnings (loss) before interest and income taxes | (69,429 | ) | 39,954 | ||||
Interest expense | 15,123 | 15,629 | |||||
Income (loss) before income taxes | (84,552 | ) | 24,325 | ||||
Provision for income taxes | 1,665 | 12,003 | |||||
Net income (loss) | $ | (86,217 | ) | $ | 12,322 | ||
Net income (loss) per share: | |||||||
Basic | $ | (3.92 | ) | $ | 0.56 | ||
Diluted | $ | (3.92 | ) | $ | 0.56 | ||
Dividends declared per share | $ | 0.3525 | $ | 0.3450 |
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
Net income (loss) | $ | (78,815 | ) | $ | 2,909 | $ | (86,217 | ) | $ | 12,322 | ||||||
Other comprehensive income (loss): | ||||||||||||||||
Pension and other post-retirement benefit adjustments, net of tax | 1,422 | 1,063 | 4,872 | 5,090 | ||||||||||||
Change in fair value of derivative instruments, net of tax | 597 | 501 | 199 | (1,200 | ) | |||||||||||
Foreign currency translation adjustments, net of tax | 2,650 | 485 | 9,647 | 811 | ||||||||||||
Other comprehensive income, net of tax | 4,669 | 2,049 | 14,718 | 4,701 | ||||||||||||
Comprehensive income (loss) | $ | (74,146 | ) | $ | 4,958 | $ | (71,499 | ) | $ | 17,023 |
September 30, 2017 | December 31, 2016 | ||||||
(unaudited) | |||||||
ASSETS | |||||||
Cash and cash equivalents | $ | 21,574 | $ | 61,011 | |||
Accounts receivable — net | 89,084 | 85,113 | |||||
Inventories — net | 200,181 | 170,009 | |||||
Prepaid and other current assets | 15,941 | 16,777 | |||||
Total current assets | 326,780 | 332,910 | |||||
Purchased intangible assets — net | 14,786 | 15,225 | |||||
Goodwill | 84,412 | 164,112 | |||||
Deferred income taxes | 38,119 | 40,016 | |||||
Other assets | 10,852 | 9,514 | |||||
Property, plant and equipment — net | 263,349 | 256,392 | |||||
Total assets | $ | 738,298 | $ | 818,169 | |||
LIABILITIES AND SHAREHOLDERS' EQUITY | |||||||
Accounts payable | $ | 73,645 | $ | 71,582 | |||
Salaries and wages | 26,667 | 27,018 | |||||
Accrued liabilities | 49,511 | 41,807 | |||||
Accrued income taxes | 1,399 | 1,384 | |||||
Pension liability (current portion) | 2,263 | 2,461 | |||||
Non-pension post-retirement benefits (current portion) | 4,903 | 4,892 | |||||
Derivative liability | 954 | 1,928 | |||||
Long-term debt due within one year | 7,443 | 5,009 | |||||
Total current liabilities | 166,785 | 156,081 | |||||
Long-term debt | 391,439 | 402,831 | |||||
Pension liability | 44,553 | 43,934 | |||||
Non-pension post-retirement benefits | 50,208 | 55,373 | |||||
Deferred income taxes | 2,079 | 1,859 | |||||
Other long-term liabilities | 12,420 | 12,972 | |||||
Total liabilities | 667,484 | 673,050 | |||||
Contingencies (Note 13) | |||||||
Shareholders’ equity: | |||||||
Common stock, par value $.01 per share, 50,000,000 shares authorized, 22,016,108 shares issued in 2017 (21,864,541 shares issued in 2016) | 220 | 219 | |||||
Capital in excess of par value | 332,494 | 329,722 | |||||
Retained deficit | (151,421 | ) | (59,625 | ) | |||
Accumulated other comprehensive loss | (110,479 | ) | (125,197 | ) | |||
Total shareholders’ equity | 70,814 | 145,119 | |||||
Total liabilities and shareholders’ equity | $ | 738,298 | $ | 818,169 |
Common Stock Shares | Common Stock Amount | Capital in Excess of Par Value | Retained Deficit | Accumulated Other Comprehensive Loss | Total | ||||||||||||||||||
Balance December 31, 2016 | 21,864,541 | $ | 219 | $ | 329,722 | $ | (59,625 | ) | $ | (125,197 | ) | $ | 145,119 | ||||||||||
Cumulative-effect adjustment for the adoption of ASU 2016-09 | 127 | 2,183 | 2,310 | ||||||||||||||||||||
Net loss | (86,217 | ) | (86,217 | ) | |||||||||||||||||||
Other comprehensive income | 14,718 | 14,718 | |||||||||||||||||||||
Stock compensation expense | 2,857 | 2,857 | |||||||||||||||||||||
Dividends | (7,762 | ) | (7,762 | ) | |||||||||||||||||||
Stock withheld for employee taxes | (623 | ) | (623 | ) | |||||||||||||||||||
Stock issued | 151,567 | 1 | 411 | 412 | |||||||||||||||||||
Balance September 30, 2017 | 22,016,108 | $ | 220 | $ | 332,494 | $ | (151,421 | ) | $ | (110,479 | ) | $ | 70,814 |
Nine months ended September 30, | |||||||
2017 | 2016 | ||||||
Operating activities: | |||||||
Net income (loss) | $ | (86,217 | ) | $ | 12,322 | ||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||||||
Depreciation and amortization | 33,616 | 36,669 | |||||
Loss on asset sales and disposals | 224 | 165 | |||||
Change in accounts receivable | (2,000 | ) | (3,714 | ) | |||
Change in inventories | (25,944 | ) | (12,949 | ) | |||
Change in accounts payable | 3,283 | (6,669 | ) | ||||
Accrued interest and amortization of discounts and finance fees | 929 | (1,510 | ) | ||||
Goodwill impairment | 79,700 | — | |||||
Pension & non-pension post-retirement benefits, net | 3,007 | (1,653 | ) | ||||
Accrued liabilities & prepaid expenses | 8,716 | 15,174 | |||||
Income taxes | (1,942 | ) | 2,344 | ||||
Share-based compensation expense | 2,930 | 4,334 | |||||
Other operating activities | (94 | ) | 308 | ||||
Net cash provided by operating activities | 16,208 | 44,821 | |||||
Investing activities: | |||||||
Additions to property, plant and equipment | (39,140 | ) | (23,523 | ) | |||
Net cash used in investing activities | (39,140 | ) | (23,523 | ) | |||
Financing activities: | |||||||
Borrowings on ABL credit facility | 21,004 | 6,000 | |||||
Repayments on ABL credit facility | (12,277 | ) | (6,000 | ) | |||
Other repayments | (632 | ) | (350 | ) | |||
Other borrowings | — | 339 | |||||
Repayments on Term Loan B | (18,300 | ) | (18,300 | ) | |||
Stock options exercised | 466 | 1,153 | |||||
Taxes paid on distribution of equity awards | (623 | ) | (862 | ) | |||
Dividends | (7,762 | ) | (7,551 | ) | |||
Treasury shares purchased | — | (2,000 | ) | ||||
Other financing activities | 888 | — | |||||
Net cash used in financing activities | (17,236 | ) | (27,571 | ) | |||
Effect of exchange rate fluctuations on cash | 731 | (101 | ) | ||||
Decrease in cash | (39,437 | ) | (6,374 | ) | |||
Cash & cash equivalents at beginning of period | 61,011 | 49,044 | |||||
Cash & cash equivalents at end of period | $ | 21,574 | $ | 42,670 | |||
Supplemental disclosure of cash flow information: | |||||||
Cash paid during the period for interest | $ | 13,949 | $ | 16,927 | |||
Cash paid during the period for income taxes | $ | 2,609 | $ | 5,576 |
1. | Description of the Business |
2. | Significant Accounting Policies |
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
(dollars in thousands) | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Stock-based compensation expense | $ | 782 | $ | 1,011 | $ | 2,930 | $ | 4,334 |
• | On the Condensed Consolidated Statements of Cash Flows, certain activity was reclassified between operating and financing activities pursuant to adoption of Accounting Standards Update No. 2016-09, "Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting," effective January 1, 2017. |
• | In note 10 Segments, net sales and related costs for certain countries were reclassified between segments to align with changes in business unit responsibilities effective January 1, 2017. |
• | In note 10 Segments, the derivative amount included in the Reconciliation of Segment EBIT to Net Income in the prior year financial statements has been included in Segment EBIT to conform to the current year presentation. |
3. | Balance Sheet Details |
(dollars in thousands) | September 30, 2017 | December 31, 2016 | |||||
Accounts receivable: | |||||||
Trade receivables | $ | 87,315 | $ | 82,851 | |||
Other receivables | 1,769 | 2,262 | |||||
Total accounts receivable, less allowances of $7,176 and $7,832 | $ | 89,084 | $ | 85,113 | |||
Inventories: | |||||||
Finished goods | $ | 183,212 | $ | 152,261 | |||
Work in process | 1,456 | 1,625 | |||||
Raw materials | 3,549 | 4,432 | |||||
Repair parts | 10,645 | 10,558 | |||||
Operating supplies | 1,319 | 1,133 | |||||
Total inventories, less loss provisions of $10,727 and $9,484 | $ | 200,181 | $ | 170,009 | |||
Accrued liabilities: | |||||||
Accrued incentives | $ | 24,674 | $ | 19,771 | |||
Other accrued liabilities | 24,837 | 22,036 | |||||
Total accrued liabilities | $ | 49,511 | $ | 41,807 |
4. | Borrowings |
(dollars in thousands) | Interest Rate | Maturity Date | September 30, 2017 | December 31, 2016 | ||||||
Borrowings under ABL Facility | floating | April 9, 2019 | $ | 8,727 | $ | — | ||||
Term Loan B | floating | (1) | April 9, 2021 | 390,700 | 409,000 | |||||
AICEP Loan | 0.00% | July 30, 2018 | 3,043 | 3,320 | ||||||
Total borrowings | 402,470 | 412,320 | ||||||||
Less — unamortized discount and finance fees | 3,588 | 4,480 | ||||||||
Total borrowings — net | 398,882 | 407,840 | ||||||||
Less — long term debt due within one year | 7,443 | 5,009 | ||||||||
Total long-term portion of borrowings — net | $ | 391,439 | $ | 402,831 |
(1) | We have entered into an interest rate swap that effectively fixes a series of our future interest payments on a portion of the Term Loan B debt. See interest rate swap in note 8 for additional details. The Term Loan B floating interest rate was 4.24 percent at September 30, 2017. |
5. | Income Taxes |
6. | Pension and Non-pension Post-retirement Benefits |
Three months ended September 30, | U.S. Plans | Non-U.S. Plans | Total | ||||||||||||||||||||
(dollars in thousands) | 2017 | 2016 | 2017 | 2016 | 2017 | 2016 | |||||||||||||||||
Service cost | $ | 979 | $ | 929 | $ | 286 | $ | 313 | $ | 1,265 | $ | 1,242 | |||||||||||
Interest cost | 3,445 | 3,740 | 725 | 663 | 4,170 | 4,403 | |||||||||||||||||
Expected return on plan assets | (5,619 | ) | (5,757 | ) | — | — | (5,619 | ) | (5,757 | ) | |||||||||||||
Amortization of unrecognized: | |||||||||||||||||||||||
Prior service cost (credit) | 59 | 65 | (54 | ) | (53 | ) | 5 | 12 | |||||||||||||||
Actuarial loss | 1,308 | 1,068 | 156 | 412 | 1,464 | 1,480 | |||||||||||||||||
Pension expense | $ | 172 | $ | 45 | $ | 1,113 | $ | 1,335 | $ | 1,285 | $ | 1,380 | |||||||||||
Nine months ended September 30, | U.S. Plans | Non-U.S. Plans | Total | ||||||||||||||||||||
(dollars in thousands) | 2017 | 2016 | 2017 | 2016 | 2017 | 2016 | |||||||||||||||||
Service cost | $ | 2,937 | $ | 2,788 | $ | 814 | $ | 948 | $ | 3,751 | $ | 3,736 | |||||||||||
Interest cost | 10,337 | 11,222 | 2,063 | 2,005 | 12,400 | 13,227 | |||||||||||||||||
Expected return on plan assets | (16,859 | ) | (17,272 | ) | — | — | (16,859 | ) | (17,272 | ) | |||||||||||||
Amortization of unrecognized: | |||||||||||||||||||||||
Prior service cost (credit) | 177 | 197 | (153 | ) | (160 | ) | 24 | 37 | |||||||||||||||
Actuarial loss | 3,925 | 3,204 | 446 | 817 | 4,371 | 4,021 | |||||||||||||||||
Settlement charge | — | 42 | — | 170 | — | 212 | |||||||||||||||||
Pension expense | $ | 517 | $ | 181 | $ | 3,170 | $ | 3,780 | $ | 3,687 | $ | 3,961 | |||||||||||
Three months ended September 30, | U.S. Plans | Non-U.S. Plans | Total | ||||||||||||||||||||
(dollars in thousands) | 2017 | 2016 | 2017 | 2016 | 2017 | 2016 | |||||||||||||||||
Service cost | $ | 157 | $ | 200 | $ | — | $ | — | $ | 157 | $ | 200 | |||||||||||
Interest cost | 526 | 652 | 10 | 11 | 536 | 663 | |||||||||||||||||
Amortization of unrecognized: | |||||||||||||||||||||||
Prior service cost (credit) | (50 | ) | 35 | — | — | (50 | ) | 35 | |||||||||||||||
Actuarial loss / (gain) | (65 | ) | 21 | (13 | ) | (10 | ) | (78 | ) | 11 | |||||||||||||
Non-pension post-retirement benefit expense | $ | 568 | $ | 908 | $ | (3 | ) | $ | 1 | $ | 565 | $ | 909 | ||||||||||
Nine months ended September 30, | U.S. Plans | Non-U.S. Plans | Total | ||||||||||||||||||||
(dollars in thousands) | 2017 | 2016 | 2017 | 2016 | 2017 | 2016 | |||||||||||||||||
Service cost | $ | 473 | $ | 598 | $ | 1 | $ | 1 | $ | 474 | $ | 599 | |||||||||||
Interest cost | 1,578 | 1,956 | 32 | 35 | 1,610 | 1,991 | |||||||||||||||||
Amortization of unrecognized: | |||||||||||||||||||||||
Prior service cost (credit) | (151 | ) | 105 | — | — | (151 | ) | 105 | |||||||||||||||
Actuarial loss / (gain) | (194 | ) | 61 | (39 | ) | (32 | ) | (233 | ) | 29 | |||||||||||||
Non-pension post-retirement benefit expense | $ | 1,706 | $ | 2,720 | $ | (6 | ) | $ | 4 | $ | 1,700 | $ | 2,724 | ||||||||||
7. | Net Income (Loss) per Share of Common Stock |
Three months ended September 30, | Nine months ended September 30, | ||||||||||||||
(dollars in thousands, except earnings per share) | 2017 | 2016 | 2017 | 2016 | |||||||||||
Numerator for earnings per share: | |||||||||||||||
Net income (loss) that is available to common shareholders | $ | (78,815 | ) | $ | 2,909 | $ | (86,217 | ) | $ | 12,322 | |||||
Denominator for basic earnings per share: | |||||||||||||||
Weighted average shares outstanding | 22,075,318 | 21,894,017 | 22,015,008 | 21,869,922 | |||||||||||
Denominator for diluted earnings per share: | |||||||||||||||
Effect of stock options and restricted stock units | — | 177,176 | — | 156,304 | |||||||||||
Adjusted weighted average shares and assumed conversions | 22,075,318 | 22,071,193 | 22,015,008 | 22,026,226 | |||||||||||
Basic earnings (loss) per share | $ | (3.57 | ) | $ | 0.13 | $ | (3.92 | ) | $ | 0.56 | |||||
Diluted earnings (loss) per share | $ | (3.57 | ) | $ | 0.13 | $ | (3.92 | ) | $ | 0.56 | |||||
Shares excluded from diluted earnings (loss) per share due to: | |||||||||||||||
Net loss position (excluded from denominator) | 63,488 | — | 92,051 | — | |||||||||||
Inclusion would have been anti-dilutive (excluded from calculation) | 893,198 | 605,032 | 780,062 | 619,058 |
8. | Derivatives |
Asset Derivatives: | ||||||||||||
(dollars in thousands) | September 30, 2017 | December 31, 2016 | ||||||||||
Derivatives designated as hedging instruments under FASB ASC 815: | Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | ||||||||
Natural gas contracts | Prepaid and other current assets | $ | — | Prepaid and other current assets | $ | 702 | ||||||
Natural gas contracts | Other assets | 8 | Other assets | 45 | ||||||||
Total designated | 8 | 747 | ||||||||||
Derivatives not designated as hedging instruments under FASB ASC 815: | ||||||||||||
Natural gas contracts | Prepaid and other current assets | — | Prepaid and other current assets | 732 | ||||||||
Natural gas contracts | Other assets | — | Other assets | 29 | ||||||||
Total undesignated | — | 761 | ||||||||||
Total | $ | 8 | $ | 1,508 | ||||||||
Liability Derivatives: | ||||||||||||
(dollars in thousands) | September 30, 2017 | December 31, 2016 | ||||||||||
Derivatives designated as hedging instruments under FASB ASC 815: | Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | ||||||||
Natural gas contracts | Derivative liability - current | $ | 45 | Derivative liability - current | $ | — | ||||||
Interest rate contract | Derivative liability - current | 852 | Derivative liability - current | 1,928 | ||||||||
Interest rate contract | Other long-term liabilities | 96 | Other long-term liabilities | 107 | ||||||||
Total designated | 993 | 2,035 | ||||||||||
Derivatives not designated as hedging instruments under FASB ASC 815: | ||||||||||||
Natural gas contracts | Derivative liability - current | 57 | Derivative liability - current | — | ||||||||
Natural gas contracts | Other long-term liabilities | 5 | Other long-term liabilities | — | ||||||||
Total undesignated | 62 | — | ||||||||||
Total | $ | 1,055 | $ | 2,035 |
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
(dollars in thousands) | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Derivatives in Cash Flow Hedging relationships: | ||||||||||||||||
Natural gas contracts | $ | 6 | $ | (35 | ) | $ | (703 | ) | $ | 59 | ||||||
Total | $ | 6 | $ | (35 | ) | $ | (703 | ) | $ | 59 |
Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||
(dollars in thousands) | 2017 | 2016 | 2017 | 2016 | |||||||||||||
Derivative: | Location: | ||||||||||||||||
Natural gas contracts | Cost of sales | $ | (76 | ) | $ | (41 | ) | $ | 81 | $ | (1,096 | ) | |||||
Total impact on net income (loss) | $ | (76 | ) | $ | (41 | ) | $ | 81 | $ | (1,096 | ) |
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
(dollars in thousands) | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Contracts where hedge accounting was not elected | $ | (4 | ) | $ | 11 | $ | (823 | ) | $ | 1,150 | ||||||
Total | $ | (4 | ) | $ | 11 | $ | (823 | ) | $ | 1,150 |
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
(dollars in thousands) | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Derivatives in Cash Flow Hedging relationships: | ||||||||||||||||
Interest rate swap | $ | 87 | $ | 6 | $ | (328 | ) | $ | (4,816 | ) | ||||||
Total | $ | 87 | $ | 6 | $ | (328 | ) | $ | (4,816 | ) |
Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||
(dollars in thousands) | 2017 | 2016 | 2017 | 2016 | |||||||||||||
Derivative: | Location: | ||||||||||||||||
Interest rate swap | Interest (expense) | $ | (358 | ) | $ | (767 | ) | $ | (1,415 | ) | $ | (1,778 | ) | ||||
Total impact on net income (loss) | $ | (358 | ) | $ | (767 | ) | $ | (1,415 | ) | $ | (1,778 | ) |
Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||
(dollars in thousands) | 2017 | 2016 | 2017 | 2016 | |||||||||||||
Derivative: | Location: | ||||||||||||||||
Currency contracts | Other income (expense) | $ | — | $ | 106 | $ | — | $ | (281 | ) | |||||||
Total | $ | — | $ | 106 | $ | — | $ | (281 | ) |
9. | Accumulated Other Comprehensive Loss |
Three months ended September 30, 2017 (dollars in thousands) | Foreign Currency Translation | Derivative Instruments | Pension and Other Post-retirement Benefits | Accumulated Other Comprehensive Loss | ||||||||||||
Balance June 30, 2017 | $ | (20,831 | ) | $ | (913 | ) | $ | (93,404 | ) | $ | (115,148 | ) | ||||
Other comprehensive income (loss) | 3,477 | 93 | — | 3,570 | ||||||||||||
Currency impact | — | — | 110 | 110 | ||||||||||||
Amounts reclassified from accumulated other comprehensive income (loss): | ||||||||||||||||
Amortization of actuarial loss (1) | — | — | 1,386 | 1,386 | ||||||||||||
Amortization of prior service cost (credit) (1) | — | — | (45 | ) | (45 | ) | ||||||||||
Cost of sales | — | 76 | — | 76 | ||||||||||||
Interest expense | — | 358 | — | 358 | ||||||||||||
Current-period other comprehensive income (loss) | 3,477 | 527 | 1,451 | 5,455 | ||||||||||||
Tax effect | (827 | ) | 70 | (29 | ) | (786 | ) | |||||||||
Balance on September 30, 2017 | $ | (18,181 | ) | $ | (316 | ) | $ | (91,982 | ) | $ | (110,479 | ) | ||||
Nine months ended September 30, 2017 (dollars in thousands) | Foreign Currency Translation | Derivative Instruments | Pension and Other Post-retirement Benefits | Accumulated Other Comprehensive Loss | ||||||||||||
Balance on December 31, 2016 | $ | (27,828 | ) | $ | (515 | ) | $ | (96,854 | ) | $ | (125,197 | ) | ||||
Other comprehensive income (loss) | 10,474 | (1,031 | ) | 4,801 | 14,244 | |||||||||||
Currency impact | — | — | (628 | ) | (628 | ) | ||||||||||
Amounts reclassified from accumulated other comprehensive income (loss): | ||||||||||||||||
Amortization of actuarial loss (1) | — | — | 4,138 | 4,138 | ||||||||||||
Amortization of prior service cost (credit) (1) | — | — | (127 | ) | (127 | ) | ||||||||||
Cost of sales | — | (81 | ) | — | (81 | ) | ||||||||||
Interest expense | — | 1,415 | — | 1,415 | ||||||||||||
Current-period other comprehensive income (loss) | 10,474 | 303 | 8,184 | 18,961 | ||||||||||||
Tax effect | (827 | ) | (104 | ) | (3,312 | ) | (4,243 | ) | ||||||||
Balance on September 30, 2017 | $ | (18,181 | ) | $ | (316 | ) | $ | (91,982 | ) | $ | (110,479 | ) |
Three months ended September 30, 2016 (dollars in thousands) | Foreign Currency Translation | Derivative Instruments | Pension and Other Post-retirement Benefits | Accumulated Other Comprehensive Loss | ||||||||||||
Balance on June 30, 2016 | $ | (22,587 | ) | $ | (3,561 | ) | $ | (91,432 | ) | $ | (117,580 | ) | ||||
Other comprehensive income (loss) | 407 | (29 | ) | — | 378 | |||||||||||
Currency impact | — | — | (31 | ) | (31 | ) | ||||||||||
Amounts reclassified from accumulated other comprehensive income (loss): | ||||||||||||||||
Amortization of actuarial loss (1) | — | — | 1,491 | 1,491 | ||||||||||||
Amortization of prior service cost (credit) (1) | — | — | 47 | 47 | ||||||||||||
Cost of sales | — | 41 | — | 41 | ||||||||||||
Interest Expense | — | 767 | — | 767 | ||||||||||||
Current-period other comprehensive income (loss) | 407 | 779 | 1,507 | 2,693 | ||||||||||||
Tax effect | 78 | (278 | ) | (444 | ) | (644 | ) | |||||||||
Balance on September 30, 2016 | $ | (22,102 | ) | $ | (3,060 | ) | $ | (90,369 | ) | $ | (115,531 | ) | ||||
Nine months ended September 30, 2016 (dollars in thousands) | Foreign Currency Translation | Derivative Instruments | Pension and Other Post-retirement Benefits | Accumulated Other Comprehensive Loss | ||||||||||||
Balance on December 31, 2015 | $ | (22,913 | ) | $ | (1,860 | ) | $ | (95,459 | ) | $ | (120,232 | ) | ||||
Other comprehensive income (loss) | 459 | (4,757 | ) | 2,755 | (1,543 | ) | ||||||||||
Currency impact | — | — | 481 | 481 | ||||||||||||
Amounts reclassified from accumulated other comprehensive income (loss): | ||||||||||||||||
Amortization of actuarial loss (1) | — | — | 4,050 | 4,050 | ||||||||||||
Amortization of prior service cost (credit) (1) | — | — | 142 | 142 | ||||||||||||
Cost of sales | — | 1,096 | — | 1,096 | ||||||||||||
Interest Expense | — | 1,778 | — | 1,778 | ||||||||||||
Current-period other comprehensive income (loss) | 459 | (1,883 | ) | 7,428 | 6,004 | |||||||||||
Tax effect | 352 | 683 | (2,338 | ) | (1,303 | ) | ||||||||||
Balance on September 30, 2016 | $ | (22,102 | ) | $ | (3,060 | ) | $ | (90,369 | ) | $ | (115,531 | ) |
10. | Segments |
Three months ended September 30, | Nine months ended September 30, | ||||||||||||||
(dollars in thousands) | 2017 | 2016 | 2017 | 2016 | |||||||||||
Net Sales: | |||||||||||||||
U.S. & Canada | $ | 112,252 | $ | 117,268 | $ | 343,452 | $ | 354,381 | |||||||
Latin America | 35,339 | 40,149 | 102,564 | 114,971 | |||||||||||
EMEA | 33,743 | 32,489 | 90,128 | 93,058 | |||||||||||
Other | 6,005 | 6,967 | 21,703 | 25,172 | |||||||||||
Consolidated | $ | 187,339 | $ | 196,873 | $ | 557,847 | $ | 587,582 | |||||||
Segment EBIT: | |||||||||||||||
U.S. & Canada | $ | 10,761 | $ | 18,635 | $ | 33,307 | $ | 55,932 | |||||||
Latin America | 3,721 | 1,954 | 2,549 | 15,226 | |||||||||||
EMEA | 1,482 | 175 | (1,412 | ) | 33 | ||||||||||
Other | (1,529 | ) | (347 | ) | (3,598 | ) | 979 | ||||||||
Total Segment EBIT | $ | 14,435 | $ | 20,417 | $ | 30,846 | $ | 72,170 | |||||||
Reconciliation of Segment EBIT to Net Income (Loss): | |||||||||||||||
Segment EBIT | $ | 14,435 | $ | 20,417 | $ | 30,846 | $ | 72,170 | |||||||
Retained corporate costs | (5,701 | ) | (6,925 | ) | (18,087 | ) | (20,699 | ) | |||||||
Goodwill impairment (note 14) | (79,700 | ) | — | (79,700 | ) | — | |||||||||
Pension settlement | — | — | — | (212 | ) | ||||||||||
Reorganization charges | — | — | (2,488 | ) | — | ||||||||||
Product portfolio optimization | — | — | — | (6,784 | ) | ||||||||||
Executive terminations | — | 98 | — | (4,521 | ) | ||||||||||
Interest expense | (5,118 | ) | (5,231 | ) | (15,123 | ) | (15,629 | ) | |||||||
Provision for income taxes | (2,731 | ) | (5,450 | ) | (1,665 | ) | (12,003 | ) | |||||||
Net income (loss) | $ | (78,815 | ) | $ | 2,909 | $ | (86,217 | ) | $ | 12,322 | |||||
Depreciation & Amortization: | |||||||||||||||
U.S. & Canada | $ | 2,850 | $ | 2,883 | $ | 9,016 | $ | 9,718 | |||||||
Latin America | 4,850 | 4,667 | 13,757 | 13,725 | |||||||||||
EMEA | 1,816 | 1,885 | 5,508 | 7,660 | |||||||||||
Other | 1,138 | 1,325 | 3,821 | 4,162 | |||||||||||
Corporate | 579 | 474 | 1,514 | 1,404 | |||||||||||
Consolidated | $ | 11,233 | $ | 11,234 | $ | 33,616 | $ | 36,669 | |||||||
Capital Expenditures: | |||||||||||||||
U.S. & Canada | $ | 2,751 | $ | 3,037 | $ | 7,145 | $ | 9,030 | |||||||
Latin America | 3,937 | 2,041 | 15,401 | 5,717 | |||||||||||
EMEA | 5,050 | 1,549 | 15,446 | 4,656 | |||||||||||
Other | 348 | 939 | 816 | 2,529 | |||||||||||
Corporate | 6 | 446 | 332 | 1,591 | |||||||||||
Consolidated | $ | 12,092 | $ | 8,012 | $ | 39,140 | $ | 23,523 |
11. | Fair Value |
• | Level 1 — Quoted prices in active markets for identical assets or liabilities. |
• | Level 2 — Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly. |
• | Level 3 — Unobservable inputs based on our own assumptions. |
Fair Value at | Fair Value at | ||||||||||||||||||||||||||||||
Asset / (Liability) (dollars in thousands) | September 30, 2017 | December 31, 2016 | |||||||||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||||
Commodity futures natural gas contracts | $ | — | $ | (99 | ) | $ | — | $ | (99 | ) | $ | — | $ | 1,508 | $ | — | $ | 1,508 | |||||||||||||
Interest rate swap | — | (948 | ) | — | (948 | ) | — | (2,035 | ) | — | (2,035 | ) | |||||||||||||||||||
Net derivative asset (liability) | $ | — | $ | (1,047 | ) | $ | — | $ | (1,047 | ) | $ | — | $ | (527 | ) | $ | — | $ | (527 | ) |
September 30, 2017 | December 31, 2016 | |||||||||||||||||
(dollars in thousands) | Fair Value Hierarchy Level | Carrying Amount | Fair Value | Carrying Amount | Fair Value | |||||||||||||
Term Loan B | Level 2 | $ | 390,700 | $ | 359,444 | $ | 409,000 | $ | 412,068 |
12. | Other Income (Expense) |
Three months ended September 30, | Nine months ended September 30, | ||||||||||||||
(dollars in thousands) | 2017 | 2016 | 2017 | 2016 | |||||||||||
Gain (loss) on currency transactions | $ | 548 | $ | 348 | $ | (1,687 | ) | $ | (376 | ) | |||||
Gain (loss) on mark-to-market natural gas contracts | (4 | ) | 11 | (823 | ) | 1,150 | |||||||||
Other non-operating income (expense) | 77 | (111 | ) | 227 | 261 | ||||||||||
Other income (expense) | $ | 621 | $ | 248 | $ | (2,283 | ) | $ | 1,035 |
13. | Contingencies |
14. | Goodwill |
(dollars in thousands) | U.S. & Canada | Latin America | EMEA | Total | ||||||||||||
Beginning balance December 31, 2016: | ||||||||||||||||
Goodwill | $ | 43,872 | $ | 125,681 | $ | 9,434 | $ | 178,987 | ||||||||
Accumulated impairment losses | (5,441 | ) | — | (9,434 | ) | (14,875 | ) | |||||||||
Net beginning balance | 38,431 | 125,681 | — | 164,112 | ||||||||||||
Impairment | — | (79,700 | ) | — | (79,700 | ) | ||||||||||
Ending balance September 30, 2017: | ||||||||||||||||
Goodwill | 43,872 | 125,681 | 9,434 | 178,987 | ||||||||||||
Accumulated impairment losses | (5,441 | ) | (79,700 | ) | (9,434 | ) | (94,575 | ) | ||||||||
Net ending balance | $ | 38,431 | $ | 45,981 | $ | — | $ | 84,412 |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
(dollars in thousands, except percentages and per-share amounts) | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Net sales | $ | 187,339 | $ | 196,873 | $ | 557,847 | $ | 587,582 | ||||||||
Gross profit (1) | $ | 37,195 | $ | 41,882 | $ | 108,287 | $ | 132,267 | ||||||||
Gross profit margin | 19.9 | % | 21.3 | % | 19.4 | % | 22.5 | % | ||||||||
Income (loss) from operations (IFO) (2) | $ | (71,587 | ) | $ | 13,342 | $ | (67,146 | ) | $ | 38,919 | ||||||
IFO margin | (38.2 | )% | 6.8 | % | (12.0 | )% | 6.6 | % | ||||||||
Net income (loss) (1) (2) | $ | (78,815 | ) | $ | 2,909 | $ | (86,217 | ) | $ | 12,322 | ||||||
Net income (loss) margin | (42.1 | )% | 1.5 | % | (15.5 | )% | 2.1 | % | ||||||||
Diluted net income (loss) per share | $ | (3.57 | ) | $ | 0.13 | $ | (3.92 | ) | $ | 0.56 | ||||||
Adjusted earnings before interest, taxes, depreciation and amortization (Adjusted EBITDA) (3) | $ | 19,967 | $ | 24,726 | $ | 46,375 | $ | 88,140 | ||||||||
Adjusted EBITDA margin | 10.7 | % | 12.6 | % | 8.3 | % | 15.0 | % |
(1) | The nine month period ended September 30, 2017 includes $0.5 million for workforce reorganization charges. The nine month period ended September 30, 2016 includes $6.8 million in product portfolio optimization charges and $0.2 million in pension settlement charges. |
(2) | In addition to item (1) above, the three and nine month periods ended September 30, 2017 include a $79.7 million non-cash goodwill impairment charge in our Latin America segment; additionally, the nine month period ended September 30, 2017 includes $2.0 million for workforce reorganization charges. The three and nine month periods ended September 30, 2016 include income of $0.1 million and expense of $4.5 million, respectively, related to executive terminations; and the nine month period ended September 30, 2016 includes $0.1 million in pension settlement charges. |
(3) | We believe that Adjusted EBITDA and the associated margin, non-GAAP financial measures, are useful metrics for evaluating our financial performance, as they are measures that we use internally to assess our performance. For certain limitations and a reconciliation from net income (loss) to Adjusted EBITDA, see the "Non-GAAP Measures" and "Adjusted EBITDA" sections below in the Discussion of Third Quarter 2017 Compared to Third Quarter 2016 and the reasons we believe these non-GAAP financial measures are useful. |
Three months ended September 30, (dollars in thousands) (2) | Increase/(Decrease) | Currency Effects | Constant Currency Sales Growth (Decline) (1) | |||||||||||||||||||
2017 | 2016 | $ Change | % Change | |||||||||||||||||||
U.S. & Canada | $ | 112,252 | $ | 117,268 | $ | (5,016 | ) | (4.3 | )% | $ | 1,190 | (5.3 | )% | |||||||||
Latin America | 35,339 | 40,149 | (4,810 | ) | (12.0 | )% | 1,087 | (14.7 | )% | |||||||||||||
EMEA | 33,743 | 32,489 | 1,254 | 3.9 | % | 221 | 3.2 | % | ||||||||||||||
Other | 6,005 | 6,967 | (962 | ) | (13.8 | )% | 260 | (17.5 | )% | |||||||||||||
Consolidated | $ | 187,339 | $ | 196,873 | $ | (9,534 | ) | (4.8 | )% | $ | 2,758 | (6.2 | )% |
(1) | We believe constant currency sales growth (decline), a non-GAAP measure, is a useful metric for evaluating our financial performance. See the "Non-GAAP Measures" section below for the reasons we believe this non-GAAP metric is useful and how it is derived. |
(2) | In the first quarter of 2017, net sales and related costs for certain countries were reclassified between segments to align with changes in business unit responsibilities. Accordingly, 2016 segment results have been reclassified to conform with the revised structure. The revised 2016 segment results do not affect any previously reported consolidated financial results. |
Three months ended September 30, (dollars in thousands) (2) | Segment EBIT Margin | |||||||||||||||||
2017 | 2016 | $ Change | 2017 | 2016 | ||||||||||||||
U.S. & Canada | $ | 10,761 | $ | 18,635 | $ | (7,874 | ) | 9.6 | % | 15.9 | % | |||||||
Latin America | $ | 3,721 | $ | 1,954 | $ | 1,767 | 10.5 | % | 4.9 | % | ||||||||
EMEA | $ | 1,482 | $ | 175 | $ | 1,307 | 4.4 | % | 0.5 | % |
(1) | Segment EBIT represents earnings before interest and taxes 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. Segment EBIT also includes an allocation of manufacturing costs for inventory produced at a Libbey facility that is located in a region other than the end market in which the inventory is sold. This allocation can fluctuate from year to year based on the relative demands for products produced in regions other than the end markets in which they are sold. See note 10 to the Condensed Consolidated Financial Statements for a reconciliation of Segment EBIT to net income (loss). |
(2) | In the first quarter of 2017, net sales and related costs for certain countries were reclassified between segments to align with changes in business unit responsibilities. Accordingly, 2016 segment results have been reclassified to conform with the revised structure. The revised 2016 segment results do not affect any previously reported consolidated financial results. |
Three months ended September 30, | ||||||||
(dollars in thousands) | 2017 | 2016 | ||||||
Net income (loss) (U.S. GAAP) | $ | (78,815 | ) | $ | 2,909 | |||
Add: | ||||||||
Interest expense | 5,118 | 5,231 | ||||||
Provision for income taxes | 2,731 | 5,450 | ||||||
Depreciation and amortization | 11,233 | 11,234 | ||||||
Add: Special items before interest and taxes: | ||||||||
Goodwill impairment (see note 14) | 79,700 | — | ||||||
Executive terminations | — | (98 | ) | |||||
Adjusted EBITDA (non-GAAP) | $ | 19,967 | $ | 24,726 |
• | Adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs; |
• | Adjusted EBITDA does not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on our debts; |
• | Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and Adjusted EBITDA does not reflect any cash requirements for such replacements of capital expenditures or contractual commitments; |
• | Adjusted EBITDA does not reflect the impact of certain cash charges resulting from matters we consider not to be indicative of our ongoing operations; and |
• | Other companies in our industry may calculate Adjusted EBITDA differently than we do, limiting its usefulness as a comparative measure. |
Nine months ended September 30, | Increase/(Decrease) | Currency Effects | Constant Currency Sales Growth (Decline) (1) | |||||||||||||||||||
(dollars in thousands) (2) | 2017 | 2016 | $ Change | % Change | ||||||||||||||||||
U.S. & Canada | $ | 343,452 | $ | 354,381 | $ | (10,929 | ) | (3.1 | )% | $ | 2,495 | (3.8 | )% | |||||||||
Latin America | 102,564 | 114,971 | (12,407 | ) | (10.8 | )% | (2,318 | ) | (8.8 | )% | ||||||||||||
EMEA | 90,128 | 93,058 | (2,930 | ) | (3.1 | )% | (3,262 | ) | 0.4 | % | ||||||||||||
Other | 21,703 | 25,172 | (3,469 | ) | (13.8 | )% | 1 | (13.8 | )% | |||||||||||||
Consolidated | $ | 557,847 | $ | 587,582 | $ | (29,735 | ) | (5.1 | )% | $ | (3,084 | ) | (4.5 | )% |
(1) | We believe constant currency sales growth (decline), a non-GAAP measure, is a useful metric for evaluating our financial performance. See the "Non-GAAP Measures" section below for the reasons we believe this non-GAAP metric is useful and how it is derived. |
(2) | In the first quarter of 2017, net sales and related costs for certain countries were reclassified between segments to align with changes in business unit responsibilities. Accordingly, 2016 segment results have been reclassified to conform with the revised structure. The revised 2016 segment results do not affect any previously reported consolidated financial results. |
Nine months ended September 30, 2017 | Segment EBIT Margin | |||||||||||||||||
(dollars in thousands) (2) | 2017 | 2016 | $ Change | 2017 | 2016 | |||||||||||||
U.S. & Canada | $ | 33,307 | $ | 55,932 | $ | (22,625 | ) | 9.7 | % | 15.8 | % | |||||||
Latin America | $ | 2,549 | $ | 15,226 | $ | (12,677 | ) | 2.5 | % | 13.2 | % | |||||||
EMEA | $ | (1,412 | ) | $ | 33 | $ | (1,445 | ) | (1.6 | )% | — | % |
(1) | Segment EBIT represents earnings before interest and taxes 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. Segment EBIT also includes an allocation of manufacturing costs for inventory produced at a Libbey facility that is located in a region other than the end market in which the inventory is sold. This allocation can fluctuate from year to year based on the relative demands for products produced in regions other than the end markets in which they are sold. See note 10 to the Condensed Consolidated Financial Statements for reconciliation of Segment EBIT to net income (loss). |
(2) | In the first quarter of 2017, net sales and related costs for certain countries were reclassified between segments to align with changes in business unit responsibilities. Accordingly, 2016 segment results have been reclassified to conform with the revised structure. The revised 2016 segment results do not affect any previously reported consolidated financial results. |
Nine months ended September 30, | ||||||||
(dollars in thousands) | 2017 | 2016 | ||||||
Net income (loss) (U.S. GAAP) | $ | (86,217 | ) | $ | 12,322 | |||
Add: | ||||||||
Interest expense | 15,123 | 15,629 | ||||||
Provision for income taxes | 1,665 | 12,003 | ||||||
Depreciation and amortization | 33,616 | 36,669 | ||||||
Add: Special items before interest and taxes: | ||||||||
Goodwill impairment (see note 14) | 79,700 | — | ||||||
Pension settlement | — | 212 | ||||||
Product portfolio optimization (1) | — | 6,784 | ||||||
Reorganization charges (2) | 2,488 | — | ||||||
Executive terminations | — | 4,521 | ||||||
Adjusted EBITDA (non-GAAP) | $ | 46,375 | $ | 88,140 |
(1) | Product portfolio optimization relates to inventory reductions to simplify and improve our operations. |
(2) | Workforce reorganization as a part of our cost savings initiatives. |
(dollars in thousands, except percentages and DSO, DIO, DPO and DWC) | September 30, 2017 | December 31, 2016 | ||||||
Accounts receivable — net | $ | 89,084 | $ | 85,113 | ||||
DSO (1) | 42.6 | 39.2 | ||||||
Inventories — net | $ | 200,181 | $ | 170,009 | ||||
DIO (2) | 95.7 | 78.2 | ||||||
Accounts payable | $ | 73,645 | $ | 71,582 | ||||
DPO (3) | 35.2 | 32.9 | ||||||
Trade Working Capital (4) | $ | 215,620 | $ | 183,540 | ||||
DWC (5) | 103.1 | 84.4 | ||||||
Percentage of net sales | 28.2 | % | 23.1 | % |
(1) | Days sales outstanding (DSO) measures the number of days it takes to turn receivables into cash. |
(2) | Days inventory outstanding (DIO) measures the number of days it takes to turn inventory into net sales. |
(3) | Days payable outstanding (DPO) measures the number of days it takes to pay the balances of our accounts payable. |
(4) | Trade Working Capital is defined as net accounts receivable plus net inventories less accounts payable. See below for further discussion as to the reasons we believe this non-GAAP financial measure is useful. |
(5) | Days working capital (DWC) measures the number of days it takes to turn our Trade Working Capital into cash. |
(dollars in thousands) | Interest Rate | Maturity Date | September 30, 2017 | December 31, 2016 | ||||||||
Borrowings under ABL Facility | floating | April 9, 2019 | $ | 8,727 | $ | — | ||||||
Term Loan B | floating | (1) | April 9, 2021 | 390,700 | 409,000 | |||||||
AICEP Loan | 0.00% | July 30, 2018 | 3,043 | 3,320 | ||||||||
Total borrowings | 402,470 | 412,320 | ||||||||||
Less — unamortized discount and finance fees | 3,588 | 4,480 | ||||||||||
Total borrowings — net (2) | $ | 398,882 | $ | 407,840 |
(1) | See “Derivatives” below and note 8 to the Condensed Consolidated Financial Statements. |
(2) | Total borrowings — net includes long-term debt due within one year and long-term debt as stated in our Condensed Consolidated Balance Sheets. |
Nine months ended September 30, | ||||||||
(dollars in thousands) | 2017 | 2016 | ||||||
Net cash provided by operating activities | $ | 16,208 | $ | 44,821 | ||||
Net cash used in investing activities | $ | (39,140 | ) | $ | (23,523 | ) | ||
Net cash used in financing activities | $ | (17,236 | ) | $ | (27,571 | ) |
Nine months ended September 30, | ||||||||
(dollars in thousands) | 2017 | 2016 | ||||||
Net cash provided by operating activities | $ | 16,208 | $ | 44,821 | ||||
Net cash used in investing activities | (39,140 | ) | (23,523 | ) | ||||
Free Cash Flow (1) | $ | (22,932 | ) | $ | 21,298 |
(1) | We define Free Cash Flow as the sum of net cash provided by operating activities and net cash used in investing activities. The most directly comparable U.S. GAAP financial measure is net cash provided by (used in) operating activities. |
Item 3. | Qualitative and Quantitative Disclosures about Market Risk |
Item 4. | Controls and Procedures |
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds |
Period | Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs | |||||||||
July 1 to July 31, 2017 | — | $ | — | — | 941,250 | ||||||||
August 1 to August 31, 2017 | — | $ | — | — | 941,250 | ||||||||
September 1 to September 30, 2017 | — | $ | — | — | 941,250 | ||||||||
Total | — | $ | — | — | 941,250 |
Item 6. | Exhibits |
EXHIBIT INDEX | ||
S-K Item 601 No. | Document | |
3.1 | Restated Certificate of Incorporation of Libbey Inc. (filed as Exhibit 3.1 to Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 1993 and incorporated herein by reference). | |
3.2 | ||
3.3 | ||
3.4 | ||
31.1 | ||
31.2 | ||
32.1 | ||
101.INS | XBRL Instance Document | |
101.SCH | XBRL Taxonomy Extension Schema Document | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document | |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document | |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document | |
Libbey Inc. | ||||
Date: | November 2, 2017 | by: | /s/ James C. Burmeister | |
James C. Burmeister | ||||
Vice President, Chief Financial Officer |
1. | I have reviewed this quarterly report on Form 10-Q of Libbey Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: | November 2, 2017 | By: | /s/ William A. Foley | |
William A. Foley | ||||
Chief Executive Officer & Chairman of the Board |
1. | I have reviewed this quarterly report on Form 10-Q of Libbey Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: | November 2, 2017 | By: | /s/ James C. Burmeister | |
James C. Burmeister | ||||
Vice President, Chief Financial Officer |
Date: | November 2, 2017 | By: | /s/ William A. Foley | |
William A. Foley | ||||
Chief Executive Officer & Chairman of the Board | ||||
/s/ James C. Burmeister | ||||
James C. Burmeister | ||||
Vice President, Chief Financial Officer |
Document and Entity Information - shares |
9 Months Ended | |
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Sep. 30, 2017 |
Oct. 26, 2017 |
|
Entity Information [Line Items] | ||
Entity Registrant Name | LIBBEY INC | |
Entity Central Index Key | 0000902274 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2017 | |
Document Fiscal Year Focus | 2017 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 22,016,108 |
Condensed Consolidated Statements of Operations - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
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Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
|
Net sales | $ 187,339 | $ 196,873 | $ 557,847 | $ 587,582 |
Freight billed to customers | 1,058 | 703 | 2,481 | 1,983 |
Total revenues | 188,397 | 197,576 | 560,328 | 589,565 |
Cost of sales | 151,202 | 155,694 | 452,041 | 457,298 |
Gross profit | 37,195 | 41,882 | 108,287 | 132,267 |
Selling, general and administrative expenses | 29,082 | 28,540 | 95,733 | 93,348 |
Goodwill impairment | 79,700 | 0 | 79,700 | 0 |
Income (loss) from operations | (71,587) | 13,342 | (67,146) | 38,919 |
Other income (expense) | 621 | 248 | (2,283) | 1,035 |
Earnings (loss) before interest and income taxes | (70,966) | 13,590 | (69,429) | 39,954 |
Interest expense | 5,118 | 5,231 | 15,123 | 15,629 |
Income (loss) before income taxes | (76,084) | 8,359 | (84,552) | 24,325 |
Provision for income taxes | 2,731 | 5,450 | 1,665 | 12,003 |
Net income (loss) | $ (78,815) | $ 2,909 | $ (86,217) | $ 12,322 |
Net income (loss) per share: | ||||
Basic | $ (3.57) | $ 0.13 | $ (3.92) | $ 0.56 |
Diluted | (3.57) | 0.13 | (3.92) | 0.56 |
Dividends declared per share | $ 0.1175 | $ 0.115 | $ 0.3525 | $ 0.345 |
Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
|
Net income (loss) | $ (78,815) | $ 2,909 | $ (86,217) | $ 12,322 |
Other comprehensive income (loss): | ||||
Pension and other post-retirement benefit adjustments, net of tax | 1,422 | 1,063 | 4,872 | 5,090 |
Change in fair value of derivative instruments, net of tax | 597 | 501 | 199 | (1,200) |
Foreign currency translation adjustments, net of tax | 2,650 | 485 | 9,647 | 811 |
Other comprehensive income, net of tax | 4,669 | 2,049 | 14,718 | 4,701 |
Comprehensive income (loss) | $ (74,146) | $ 4,958 | $ (71,499) | $ 17,023 |
Condensed Consolidated Balance Sheets Parenthetical - $ / shares |
Sep. 30, 2017 |
Dec. 31, 2016 |
---|---|---|
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 22,016,108 | 21,864,541 |
Condensed Consolidated Statement of Shareholders' Equity Statement - 9 months ended Sep. 30, 2017 - USD ($) $ in Thousands |
Total |
Common Stock |
Capital in Excess of Par Value |
Retained Deficit |
Accumulated Other Comprehensive Loss |
---|---|---|---|---|---|
Balance, value at Dec. 31, 2016 | $ 145,119 | $ 219 | $ 329,722 | $ (59,625) | $ (125,197) |
Balance, shares at Dec. 31, 2016 | 21,864,541 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Cumlative-effect adjustment for the adoption of ASU 2016-09 | 2,310 | 127 | 2,183 | ||
Net loss | (86,217) | (86,217) | |||
Other comprehensive income | 14,718 | 14,718 | |||
Stock compensation expense | 2,857 | 2,857 | |||
Dividends | (7,762) | (7,762) | |||
Stock withheld for employee taxes | (623) | (623) | |||
Stock issued, value | 412 | $ 1 | 411 | ||
Stock issued, shares | 151,567 | ||||
Balance, value at Sep. 30, 2017 | $ 70,814 | $ 220 | $ 332,494 | $ (151,421) | $ (110,479) |
Balance, shares at Sep. 30, 2017 | 22,016,108 |
Description of the Business |
9 Months Ended |
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Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of the Business | Description of the Business Libbey is a leading global manufacturer and marketer of glass tableware products. We produce glass tableware in five countries and sell to customers in over 100 countries. We design and market, under our Libbey®, Libbey Signature®, Masters Reserve®, Crisa®, Royal Leerdam®, World® Tableware, Syracuse® China and Crisal Glass® brand names (among others), an extensive line of high-quality glass tableware, ceramic dinnerware, metal flatware, hollowware and serveware items for sale primarily in the foodservice, retail and business-to-business markets. Our sales force presents our tabletop products to the global marketplace in a coordinated fashion. We own and operate two glass tableware manufacturing plants in the United States as well as glass tableware manufacturing plants in Mexico (Libbey Mexico), the Netherlands (Libbey Holland), Portugal (Libbey Portugal) and China (Libbey China). In addition, we import tabletop products from overseas in order to complement our line of manufactured items. The combination of manufacturing and procurement allows us to compete in the global tabletop market by offering an extensive product line at competitive prices. Our website can be found at www.libbey.com. We make available, free of charge, at this website all of our reports filed or furnished pursuant to Section 13(a) or 15(d) of Securities Exchange Act of 1934, including our annual report on Form 10-K, our quarterly reports on Form 10-Q, our current reports on Form 8-K, as well as amendments to those reports. These reports are made available on our website as soon as reasonably practicable after their filing with, or furnishing to, the Securities and Exchange Commission and can also be found at www.sec.gov. Our shares are traded on the NYSE American exchange under the ticker symbol LBY. |
Significant Accounting Policies |
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Accounting Policies [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Significant Accounting Policies | Significant Accounting Policies Basis of Presentation The accompanying unaudited Condensed Consolidated Financial Statements of Libbey Inc. and its majority-owned subsidiaries (collectively, Libbey or the Company) have been prepared in accordance with U.S. Generally Accepted Accounting Principles (U.S. GAAP) for interim financial information and with the instructions to Form 10-Q and Item 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (including normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three month and nine month periods ended September 30, 2017 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017. The balance sheet at December 31, 2016 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The financial information included herein should be read in conjunction with our Consolidated Financial Statements in Item 8 of our Form 10-K for the year ended December 31, 2016. Stock-Based Compensation Expense Stock-based compensation expense charged to the Condensed Consolidated Statements of Operations is as follows:
Reclassifications Certain amounts in prior years' financial statements have been reclassified to conform to the presentation used in the three month and nine month periods ended September 30, 2017, including the following:
New Accounting Standards - Adopted In March 2016, the FASB issued ASU 2016-09, "Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting." Areas for simplification in this update involve several aspects of accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. ASU 2016-09 is effective for interim and annual reporting periods beginning after December 15, 2016. We adopted the new guidance on January 1, 2017, requiring us to recognize all excess tax benefits and tax deficiencies related to stock compensation as income tax expense or benefit in the income statement. Excess tax benefits will be recognized regardless of whether the benefit reduces taxes payable in the current period, subject to normal valuation allowance considerations. Previous guidance resulted in credits to equity for such tax benefits and delayed recognition until the tax benefits reduced income taxes payable. This provision in the standard was applied using a modified retrospective transition method by means of a cumulative-effect adjustment to equity as of the beginning of the year of adoption. As of January 1, 2017, we recorded a $2.3 million reduction to our retained deficit and an increase in deferred income tax assets. In addition, on the modified retrospective basis, we have elected to discontinue estimating forfeitures expected to occur when determining the amount of compensation expense to be recognized in each period, resulting in an immaterial impact to our retained deficit and capital in excess of par. We do not anticipate this change will have a material impact on our future results of operations. The presentation requirements for cash flows under the new standard were adopted on a retrospective basis, resulting in a reclassification on the Condensed Consolidated Statements of Cash Flows that increased cash provided by operating activities and increased cash used in financing activities for the nine months ended September 30, 2016. In January 2017, the FASB issued ASU 2017-04, "Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment." ASU 2017-04 simplifies the goodwill impairment testing by eliminating Step 2 from the goodwill impairment testing that is required should an impairment be discovered during its annual or interim assessment. ASU 2017-04 is effective for annual or interim impairment tests beginning after December 15, 2019, with early adoption permitted. We adopted this standard early in conjunction with our assessment performed at September 30, 2017; this is considered a change in accounting principle. This standard decreases the cost and complexity in applying current GAAP without significantly changing the usefulness of the information provided to users of our Condensed Consolidated Financial Statements. New Accounting Standards - Not Yet Adopted Each change to U.S. GAAP is established by the Financial Accounting Standards Board (FASB) in the form of an accounting standards update (ASU) to the FASB’s Accounting Standards Codification (ASC). We consider the applicability and impact of all ASUs. ASUs not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on the Company’s Condensed Consolidated Financial Statements. In May 2014, the FASB issued ASU 2014-09, "Revenue From Contracts With Customers", as amended by ASU's 2015-14, 2016-08, 2016-10, 2016-11, 2016-12, 2016-20 and 2017-05, which outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. ASU 2014-09 is based on the principle that an entity should recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2014-09 also requires disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to fulfill a contract. Entities have the option of using either a full retrospective or a modified retrospective approach for the adoption of the new standard. This update is effective for interim and annual reporting periods beginning after December 15, 2017. We plan to adopt this standard in the first quarter of 2018 using the modified retrospective method, whereby the cumulative effect of applying the standard is recognized at the date of initial application. We have substantially completed our evaluation of significant contracts and the review of our current accounting policies and practices to identify potential differences that would result from applying the requirements of ASU 2014-09 to our revenue contracts. In addition, we have identified, and are in the process of implementing, appropriate changes to business processes, systems and controls to support recognition and disclosure under the new standard. Based on the foregoing, we do not expect the adoption of ASU 2014-09 to have a material impact on the amount and timing of revenue recognized in our Condensed Consolidated Financial Statements. In February 2016, the FASB issued ASU 2016-02, "Leases (Topic 842)," which requires a lessee to recognize on the balance sheet, assets and liabilities for leases with lease terms of more than 12 months. Leases will be classified as either finance or operating leases, with classification affecting the pattern of expense recognition in the income statement. The new guidance also clarifies the definition of a lease and disclosure requirements. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, with early application permitted. Lessees and lessors must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The modified retrospective approach does not require any transition accounting for leases that expired before the earliest comparative period presented. We are currently evaluating the impact of this guidance on our financial statements and related disclosures, including the increase in the assets and liabilities on our balance sheet. To facilitate this, we are utilizing a comprehensive approach to review our lease portfolio, as well as assessing system requirements and control implications. See note 16, Operating Leases, in our 2016 Annual Report on Form 10-K for the year ended December 31, 2016 for our minimum lease commitments under non-cancellable operating leases. In June 2016, the FASB issued ASU 2016-13, "Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments." This standard introduces a new approach to estimating credit losses on certain types of financial instruments, including trade receivables, and modifies the impairment model for available-for-sale debt securities. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years, with early application permitted. We are currently assessing the impact that this standard will have on our Condensed Consolidated Financial Statements. In October 2016, the FASB issued ASU 2016-16, "Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory." ASU 2016-16 clarifies that an entity should recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. ASU 2016-16 is effective for annual and interim reporting periods beginning after December 15, 2017, with early adoption permitted. We are currently assessing the impact that this standard will have on our Condensed Consolidated Financial Statements. In March 2017, the FASB issued ASU 2017-07, "Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Post-retirement Benefit Cost." ASU 2017-07 requires that only the service cost component of pension and post-retirement benefit costs be reported within income from operations. The other components of net benefit cost are required to be presented in the income statement outside of income from operations, if presented. In addition, this ASU allows only the service cost component to be eligible for capitalization when applicable. ASU 2017-07 is effective for annual and interim reporting periods beginning after December 15, 2017, with early adoption permitted. Presentation on the Condensed Consolidated Statements of Operations will be retrospective and any impact to capitalized costs will be prospectively adopted. We plan to adopt this standard in the first quarter of 2018 and expect the impact to be reclassifications of applicable costs and credits from income from operations to other income (expense). In August 2017, the FASB issued ASU 2017-12, "Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities." ASU 2017-12 amends the hedge accounting rules to simplify the application of hedge accounting guidance and better portray the economic results of risk management activities in the financial statements. The guidance expands the ability to hedge nonfinancial and financial risk components, reduces complexity in fair value hedges of interest rate risk, eliminates the requirement to separately measure and report hedge ineffectiveness, and eases certain hedge effectiveness assessment requirements. ASU 2017-12 is effective for annual and interim reporting periods beginning after December 15, 2018, with early adoption permitted. We are currently evaluating the impact of this guidance, including transition elections and required disclosures, on our financial statements and the timing of adoption. |
Balance Sheet Details |
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Balance Sheet Details | Balance Sheet Details The following table provides detail of selected balance sheet items:
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Borrowings |
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Borrowings | Borrowings Borrowings consist of the following:
________________________
At September 30, 2017, the available borrowing base under the ABL Facility was offset by a $0.5 million rent reserve and a $0.1 million natural gas derivative liability. The ABL Facility also provides for the issuance of up to $30.0 million of letters of credit which, when outstanding, are applied against the $100.0 million limit. At September 30, 2017, $7.2 million in letters of credit were outstanding. Remaining unused availability under the ABL Facility was $83.5 million at September 30, 2017, compared to $88.4 million at December 31, 2016. |
Income Taxes |
9 Months Ended |
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Sep. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes For interim tax reporting, we estimate our annual effective tax rate and apply it to our year-to-date ordinary income. Tax jurisdictions with a projected or year-to-date loss for which a tax benefit cannot be realized are excluded from the annualized effective tax rate. The tax effects of unusual or infrequently occurring items, including changes in judgment about valuation allowances and effects of changes in tax laws or rates, are reported in the interim period in which they occur. Our effective tax rate was (2.0) percent for the nine months ended September 30, 2017, compared to 49.3 percent for the nine months ended September 30, 2016. Our effective tax rate for the nine months ended September 30, 2017, which was below the United States statutory rate, was affected by the nondeductible goodwill impairment charge of (40.2) percent, the timing and mix of pretax income earned in jurisdictions with rates lower than the United States statutory rate of 13.7 percent, the impact of foreign exchange of (5.3) percent, and other items including foreign withholding tax and nondeductible expenses of (5.2) percent. Our effective tax rate for the nine months ended September 30, 2016, which was above the United States statutory rate, was affected by the timing and mix of pretax income earned in jurisdictions with rates lower than the United States statutory rate of 5.9 percent, the impact of foreign exchange of (15.4) percent, and other items including foreign withholding tax and nondeductible expenses of 23.8 percent. The Company and its subsidiaries are subject to examination by various countries' tax authorities. These examinations may lead to proposed or assessed adjustments to our taxes. In August 2016, one of our Mexican subsidiaries received a tax assessment from the Mexican tax authority (SAT) related to the audit of its 2010 tax year. The amount assessed was approximately 3 billion Mexican pesos, which was equivalent to approximately $157 million U.S. dollars as of the date of the assessment. The Company has filed an administrative appeal with SAT requesting that the assessment be fully nullified. We are awaiting the outcome of the appeal. Management, in consultation with external legal counsel, believes that if contested in the Mexican court system, it is more likely than not that the Company would prevail on all significant components of the assessment. Management intends to continue to vigorously contest all significant components of the assessment in the Mexican courts if they are not nullified at the administrative appeal level. We believe that our tax reserves related to uncertain tax positions are adequate at this time. There were no significant developments affecting this matter for the nine months ended September 30, 2017. See note 2 for details regarding the tax effects of adopting ASU 2016-09, "Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting," effective January 1, 2017. |
Pension and Non-pension Postretirement Benefits |
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Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pension and Non-pension Postretirement Benefits | Pension and Non-pension Post-retirement Benefits We have pension plans covering the majority of our employees. Benefits generally are based on compensation and service for salaried employees and job grade and length of service for hourly employees. In addition, we have an unfunded supplemental employee retirement plan (SERP) that covers certain salaried U.S.-based employees of Libbey hired before January 1, 2006. The U.S. pension plans cover the salaried U.S.-based employees of Libbey hired before January 1, 2006, and most hourly U.S.-based employees (excluding employees hired at Shreveport after December 15, 2008 and at Toledo after September 30, 2010). Effective January 1, 2013, we ceased annual company contribution credits to the cash balance accounts in our Libbey U.S. Salaried Pension Plan and SERP. The non-U.S. pension plans cover the employees of our wholly owned subsidiary in Mexico and are unfunded. The components of our net pension expense, including the SERP, are as follows:
We have contributed $0.6 million and $2.6 million of cash into our pension plans for the three months and nine months ended September 30, 2017, respectively. Pension contributions for the remainder of 2017 are estimated to be $0.5 million. We provide certain retiree health care and life insurance benefits covering our U.S. and Canadian salaried employees hired before January 1, 2004, and a majority of our union hourly employees (excluding employees hired at Shreveport after December 15, 2008 and at Toledo after September 30, 2010). Employees are generally eligible for benefits upon retirement and completion of a specified number of years of creditable service. Benefits for most hourly retirees are determined by collective bargaining. The U.S. non-pension, post-retirement plans cover the hourly and salaried U.S.-based employees of Libbey (excluding those mentioned above). The non-U.S., non-pension, post-retirement plans cover the retirees and active employees of Libbey who are located in Canada. The post-retirement benefit plans are unfunded. The provision for our non-pension post-retirement benefit expense consists of the following:
Our 2017 estimate of non-pension cash payments is $4.0 million, and we have paid $1.0 million and $2.6 million for the three months and nine months ended September 30, 2017, respectively. |
Net Income (Loss) per Share of Common Stock |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Income (Loss) per Share of Common Stock | Net Income (Loss) per Share of Common Stock The following table sets forth the computation of basic and diluted earnings (loss) per share:
When applicable, diluted shares outstanding include the dilutive impact of restricted stock units. Diluted shares also include the impact of eligible employee stock options, which are calculated based on the average share price for each fiscal period using the treasury stock method. As part of the adoption of ASU 2016-09 as of January 1, 2017, anticipated tax windfalls and shortfalls are no longer included in the calculation of assumed proceeds when applying the treasury stock method. |
Derivatives |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivatives | Derivatives We utilize derivative financial instruments to hedge certain interest rate risks associated with our long-term debt, commodity price risks associated with forecasted future natural gas requirements and foreign exchange rate risks associated with transactions denominated in a currency other than the U.S. dollar. These derivatives, except for the foreign currency contracts and the natural gas contracts used in our Mexican manufacturing facilities, qualify for hedge accounting since the hedges are highly effective, and we have designated and documented contemporaneously the hedging relationships involving these derivative instruments. While we intend to continue to meet the conditions for hedge accounting, if hedges do not qualify as highly effective or if we do not believe that forecasted transactions would occur, the changes in the fair value of the derivatives used as hedges would be reflected in our earnings. Fair Values The following table provides the fair values of our derivative financial instruments for the periods presented:
Natural Gas Contracts We use natural gas swap contracts related to forecasted future North American natural gas requirements. The objective of these commodity contracts is to limit the fluctuations in prices paid due to price movements in the underlying commodity. We consider our forecasted natural gas requirements in determining the quantity of natural gas to hedge. We combine the forecasts with historical observations to establish the percentage of forecast eligible to be hedged, typically ranging from 40 percent to 70 percent of our anticipated requirements, up to 18 months in the future. The fair values of these instruments are determined from market quotes. As of September 30, 2017, we had commodity contracts for 2,590,000 MMBTUs of natural gas. At December 31, 2016, we also had commodity contracts for 2,590,000 MMBTUs of natural gas. All of our derivatives for natural gas in the U.S. qualify and are designated as cash flow hedges at September 30, 2017. Hedge accounting is applied only when the derivative is deemed to be highly effective at offsetting changes in fair values or anticipated cash flows of the hedged item or transaction. For hedged forecasted transactions, hedge accounting is discontinued if the forecasted transaction is no longer probable to occur, and any previously deferred gains or losses would be recorded to earnings immediately. Changes in the effective portion of the fair value of these hedges are recorded in other comprehensive income (loss). The ineffective portion of the change in the fair value of a derivative designated as a cash flow hedge is recognized in other income (expense). As the natural gas contracts mature, the accumulated gains (losses) for the respective contracts are reclassified from accumulated other comprehensive loss to current expense in cost of sales in our Condensed Consolidated Statement of Operations. Since October 1, 2014, our derivatives for natural gas in Mexico have not been designated as cash flow hedges. All mark-to-market changes on these derivatives are reflected in other income (expense). We (received) paid additional cash related to natural gas derivative settlements of $0.1 million and $0.1 million in the three months ended September 30, 2017 and 2016, respectively, and $(0.2) million and $2.3 million for the nine months ended September 30, 2017 and 2016, respectively, due to the difference between the fixed unit rate of our natural gas contracts and the variable unit rate of our natural gas cost from suppliers. Based on our current valuation, we estimate that accumulated losses for natural gas currently carried in accumulated other comprehensive loss that will be reclassified into earnings over the next 12 months will result in an immaterial impact to our Condensed Consolidated Statements of Operations. The following table provides a summary of the effective portion of derivative gain (loss) recognized in other comprehensive income (loss) from our natural gas contracts:
The following table provides a summary of the effective portion of derivative reclassified from accumulated other comprehensive loss to the Condensed Consolidated Statements of Operations from our natural gas contracts:
The following table provides a summary of the gain (loss) recognized in other income (expense) in the Condensed Consolidated Statements of Operations from our natural gas contracts in Mexico:
Interest Rate Swap On April 1, 2015, we executed an interest rate swap on our Term Loan B as part of our risk management strategy to mitigate the risks involved with fluctuating interest rates. The interest rate swap effectively converts $220.0 million of our Term Loan B debt from a variable interest rate to a 4.85 percent fixed interest rate, thus reducing the impact of interest rate changes on future income. The fixed rate swap became effective in January 2016 and expires in January 2020. This interest rate swap is valued using the market standard methodology of netting the discounted expected future variable cash receipts and the discounted future fixed cash payments. The variable cash receipts are based on an expectation of future interest rates derived from observed market interest rate forward curves. Our interest rate swap qualifies and is designated as a cash flow hedge at September 30, 2017, and is accounted for under FASB ASC 815, "Derivatives and Hedging". Hedge accounting is applied only when the derivative is deemed to be highly effective at offsetting changes in fair values or anticipated cash flows of the hedged item or transaction. For hedged forecasted transactions, hedge accounting is discontinued if the forecasted transaction is no longer probable to occur, and any previously deferred gains or losses are recorded to earnings immediately. Changes in the effective portion of the fair value of these hedges are recorded in other comprehensive income (loss). The ineffective portion, if any, of the change in the fair value of a derivative designated as a cash flow hedge is recognized in other income (expense). Based on our current valuation, we estimate that accumulated losses currently carried in accumulated other comprehensive loss that will be reclassified into earnings over the next 12 months will result in $0.9 million of additional interest expense in our Condensed Consolidated Statements of Operations. The following table provides a summary of the effective portion of derivative gain (loss) recognized in other comprehensive income (loss) from our interest rate swap:
The following table provides a summary of the effective portion of derivative reclassified from accumulated other comprehensive income (loss) to the Condensed Consolidated Statements of Operations from our interest rate swap:
Currency Contracts Our foreign currency exposure arises from transactions denominated in a currency other than the U.S. dollar and is primarily associated with our Canadian dollar denominated accounts receivable. From time to time, we enter into a series of foreign currency contracts to sell Canadian dollars. At September 30, 2017 and December 31, 2016, we had no foreign currency contracts outstanding. The fair values of these instruments are determined from market quotes. The values of these derivatives will change over time as cash receipts and payments are made and as market conditions change. Gains (losses) on currency derivatives that were not designated as hedging instruments are recorded in other income (expense) as follows:
We do not believe we are exposed to more than a nominal amount of credit risk in our natural gas hedges, interest rate swap and currency contracts as the counterparties are established financial institutions. The counterparties for the derivative agreements are rated BBB+ or better as of September 30, 2017, by Standard and Poor’s. |
Accumulated Other Comprehensive Income (Loss) |
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Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Loss Accumulated other comprehensive loss, net of tax, is as follows:
___________________________ (1) These accumulated other comprehensive income components are included in the computation of net periodic benefit cost within the cost of sales and selling, general and administrative expenses on the Condensed Consolidated Statements of Operations. |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segments | Segments Our reporting segments align with our regionally focused organizational structure, which we believe enables us to better serve customers across the globe. Under this structure, we report financial results for U.S. and Canada; Latin America; Europe, the Middle East and Africa (EMEA); and Other. Segment results are based primarily on the geographical destination of the sale. In the first quarter of 2017, net sales and related costs for certain countries were reclassified between segments to align with changes in business unit responsibilities. Accordingly, 2016 segment results have been reclassified to conform with the revised structure. The revised 2016 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, as well as glass products for OEMs regardless of end–market destination. 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. Segment EBIT also includes an allocation of manufacturing costs for inventory produced at a Libbey facility that is located in a region other than the end market in which the inventory is sold. This allocation can fluctuate from year to year based on the relative demands for products produced in regions other than the end markets in which they are sold. As the gain (loss) on mark-to-market natural gas contracts is considered representative of our ongoing operations, it is included in Segment EBIT in 2017; the prior year derivative amount originally excluded from Segment EBIT in 2016 has been reclassified and included in Segment EBIT to conform to the current year presentation. 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.
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Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value | Fair Value Fair value is the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy prioritizes the inputs used in measuring fair value into three broad levels as follows:
The fair values of our commodity futures natural gas contracts are determined using observable market inputs. The fair value of our interest rate swap is based on the market standard methodology of netting the discounted expected future variable cash receipts and the discounted future fixed cash payments. The variable cash receipts are based on an expectation of future interest rates derived from observed market interest rate forward curves. Since these inputs are observable in active markets over the terms that the instruments are held, the derivatives are classified as Level 2 in the hierarchy. We also evaluate Company and counterparty risk in determining fair values. The commodity futures natural gas contracts and interest rate swap are hedges of either recorded assets or liabilities or anticipated transactions. Changes in values of the underlying hedged assets and liabilities or anticipated transactions are not reflected in the above table. Financial instruments carried at cost on the Condensed Consolidated Balance Sheets, as well as the related fair values, are as follows:
The fair value of our Term Loan B has been calculated based on quoted market prices for the same or similar issues, and the fair value of our ABL Facility approximates carrying value due to variable rates. The fair value of our other immaterial debt approximates carrying value at September 30, 2017 and December 31, 2016. The fair value of our cash and cash equivalents, accounts receivable and accounts payable approximate their carrying value due to their short term nature. |
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Other Income (Expense) | Other Income (Expense) Items included in other income (expense) in the Condensed Consolidated Statements of Operations are as follows:
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Contingencies |
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Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | Contingencies Legal Proceedings From time to time, we are identified as a "potentially responsible party" (PRP) under the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (CERCLA) and/or similar state laws that impose liability without regard to fault for costs and damages relating to the investigation and clean-up of contamination resulting from releases or threatened releases of hazardous substances. We are also subject to similar laws in some of the countries where our facilities are located. Our environmental, health and safety department monitors compliance with applicable laws on a global basis. On October 30, 2009, the United States Environmental Protection Agency ("U.S. EPA") designated Syracuse China Company ("Syracuse China"), our wholly-owned subsidiary, as one of eight PRPs with respect to the Lower Ley Creek sub-site of the Onondaga Lake Superfund site located near the ceramic dinnerware manufacturing facility that Syracuse China operated from 1995 to 2009 in Syracuse, New York. As a PRP, we may be required to pay a share of the costs of investigation and remediation of the Lower Ley Creek sub-site. U.S. EPA has completed its Remedial Investigation (RI), Feasibility Study (FS), Risk Assessment (RA) and Proposed Remedial Action Plan (PRAP). U.S. EPA issued its Record of Decision (RoD) on September 30, 2014. The RoD indicates that U.S. EPA's estimate of the undiscounted cost of remediation ranges between approximately $17.0 million (assuming local disposal of contaminated sediments is feasible) and approximately $24.8 million (assuming local disposal is not feasible). However, the RoD acknowledges that the final cost of the cleanup will depend upon the actual volume of contaminated material, the degree to which it is contaminated, and where the excavated soil and sediment is properly disposed. In connection with the General Motors Corporation bankruptcy, U.S. EPA recovered $22.0 million from Motors Liquidation Company (MLC), the successor to General Motors Corporation. If the cleanup costs do not exceed the amount recovered by U.S. EPA from MLC, Syracuse China may suffer no loss. If, and to the extent the cleanup costs exceed the amount recovered by U.S. EPA from MLC, it is not yet known whether other PRPs will be added to the current group of PRPs or how any excess costs may be allocated among the PRPs. On March 3, 2015, the EPA issued to the PRPs notices and requests to negotiate performance of the remedial design (RD) work. The notices contemplate that any agreement to perform the RD work would be memorialized in an Administrative Order on Consent (AOC). On July 14, 2016, the PRPs entered into an AOC to perform the RD work. The EPA and PRPs anticipate that the RD work will produce additional information from which the feasibility of a local disposal option and the cleanup costs can be better determined. The EPA has declined to advance the GM Settlement Funds for the RD work, instead conditioning use of those funds to reimburse for the RD work upon the successful completion of the RD work and the finalization of an AOC to perform the remedial action work. To the extent that Syracuse China has a liability with respect to the Lower Ley Creek sub-site, including without limitation costs to fund the RD work, and to the extent the liability arose prior to our 1995 acquisition of the Syracuse China assets, the liability would be subject to the indemnification provisions contained in the Asset Purchase Agreement between the Company and The Pfaltzgraff Co. (now known as TPC-York, Inc. ("TPC York")) and certain of its subsidiaries. Accordingly, Syracuse China has notified TPC York of its claim for indemnification under the Asset Purchase Agreement. In connection with the above proceedings, an estimated environmental liability of $0.8 million and $0.9 million has been recorded in other long-term liabilities and a recoverable amount of $0.4 million and $0.5 million has been recorded in other long-term assets in the Condensed Consolidated Balance Sheets at September 30, 2017 and December 31, 2016, respectively. Although we cannot predict the ultimate outcome of this proceeding, we believe that it will not have a material adverse impact on our financial condition, results of operations or liquidity. Income Taxes The Company and its subsidiaries are subject to examination by various countries' tax authorities. These examinations may lead to proposed or assessed adjustments to our taxes. Please refer to note 5, Income Taxes, for a detailed discussion on tax contingencies. |
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Goodwill | Goodwill Changes in the carrying amount of goodwill by segment for the nine months ended September 30, 2017 are as follows:
As part of our on-going assessment of goodwill, we noted that third quarter sales, profitability and cash flow of our Mexico reporting unit (within the Latin America segment) significantly underperformed in comparison to the forecast, and expectations for the fourth quarter of 2017 were lowered as well. These factors, as well as continuing competitive pressures, long term weakness of the Mexican peso relative to the U.S. dollar, and an increase in the discount rate of 70 basis points since December 31, 2016 (the most recent valuation date), all contributed to increased pressure on the outlook of the reporting unit. As a result, we determined a triggering event had occurred for our Mexico reporting unit. Accordingly, an interim impairment test was performed as of September 30, 2017, indicating that the carrying value of the Mexico reporting unit exceeded its fair value, and in accordance with the early adoption of ASU 2017-04, we recorded a non-cash impairment charge of $79.7 million during the third quarter of 2017. When performing our test for impairment, we measured each reporting unit's fair value using a combination of "income" and "market" approaches on a shipping point basis. The income approach calculates the fair value of the reporting unit based on a discounted cash flow analysis, incorporating the weighted average cost of capital of a hypothetical third party buyer. Significant estimates in the income approach include the following: discount rate; expected financial outlook and profitability of the reporting unit's business; and foreign currency impacts (all Level 3 inputs in the fair value hierarchy). Discount rates use the weighted average cost of capital for companies within our peer group, adjusted for specific company risk premium factors. The market approach uses the "Guideline Company" method, which calculates the fair value of the reporting unit based on a comparison of the reporting unit to comparable publicly traded companies. Significant estimates in the market approach model include identifying similar companies with comparable business factors such as size, growth, profitability, risk and return on investment, assessing comparable multiples, as well as consideration of control premiums (Level 2 inputs). The blended approach assigns a 70 percent weighting to the income approach and 30 percent to the market approach (Level 3 input). The higher weighting is given to the income approach due to some limitations of publicly available peer information used in the market approach. The blended fair value of both approaches is then compared to the carrying value, and to the extent that fair value exceeds the carrying value, no impairment exists. However, to the extent the carrying value exceeds the fair value, an impairment is recorded. With the estimated fair value of the Mexico reporting unit equaling its carrying value as of September 30, 2017, there is a potential of future impairment for the remaining goodwill balance of $46.0 million should the discount rate increase or the challenging environment last longer or be deeper than expected and require us to further reduce our expected future operating results. As a result of the factors noted above, we evaluated the fair value of our long-lived assets noting that the fair value continues to exceed carrying value as of September 30, 2017. |
Significant Accounting Policies (Policies) |
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Accounting Policies [Abstract] | |||||||||||||
Basis of Presentation | Basis of Presentation The accompanying unaudited Condensed Consolidated Financial Statements of Libbey Inc. and its majority-owned subsidiaries (collectively, Libbey or the Company) have been prepared in accordance with U.S. Generally Accepted Accounting Principles (U.S. GAAP) for interim financial information and with the instructions to Form 10-Q and Item 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (including normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three month and nine month periods ended September 30, 2017 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017. The balance sheet at December 31, 2016 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The financial information included herein should be read in conjunction with our Consolidated Financial Statements in Item 8 of our Form 10-K for the year ended December 31, 2016. |
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Reclassifications | Reclassifications Certain amounts in prior years' financial statements have been reclassified to conform to the presentation used in the three month and nine month periods ended September 30, 2017, including the following:
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New Accounting Standards | New Accounting Standards - Adopted In March 2016, the FASB issued ASU 2016-09, "Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting." Areas for simplification in this update involve several aspects of accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. ASU 2016-09 is effective for interim and annual reporting periods beginning after December 15, 2016. We adopted the new guidance on January 1, 2017, requiring us to recognize all excess tax benefits and tax deficiencies related to stock compensation as income tax expense or benefit in the income statement. Excess tax benefits will be recognized regardless of whether the benefit reduces taxes payable in the current period, subject to normal valuation allowance considerations. Previous guidance resulted in credits to equity for such tax benefits and delayed recognition until the tax benefits reduced income taxes payable. This provision in the standard was applied using a modified retrospective transition method by means of a cumulative-effect adjustment to equity as of the beginning of the year of adoption. As of January 1, 2017, we recorded a $2.3 million reduction to our retained deficit and an increase in deferred income tax assets. In addition, on the modified retrospective basis, we have elected to discontinue estimating forfeitures expected to occur when determining the amount of compensation expense to be recognized in each period, resulting in an immaterial impact to our retained deficit and capital in excess of par. We do not anticipate this change will have a material impact on our future results of operations. The presentation requirements for cash flows under the new standard were adopted on a retrospective basis, resulting in a reclassification on the Condensed Consolidated Statements of Cash Flows that increased cash provided by operating activities and increased cash used in financing activities for the nine months ended September 30, 2016. In January 2017, the FASB issued ASU 2017-04, "Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment." ASU 2017-04 simplifies the goodwill impairment testing by eliminating Step 2 from the goodwill impairment testing that is required should an impairment be discovered during its annual or interim assessment. ASU 2017-04 is effective for annual or interim impairment tests beginning after December 15, 2019, with early adoption permitted. We adopted this standard early in conjunction with our assessment performed at September 30, 2017; this is considered a change in accounting principle. This standard decreases the cost and complexity in applying current GAAP without significantly changing the usefulness of the information provided to users of our Condensed Consolidated Financial Statements. New Accounting Standards - Not Yet Adopted Each change to U.S. GAAP is established by the Financial Accounting Standards Board (FASB) in the form of an accounting standards update (ASU) to the FASB’s Accounting Standards Codification (ASC). We consider the applicability and impact of all ASUs. ASUs not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on the Company’s Condensed Consolidated Financial Statements. In May 2014, the FASB issued ASU 2014-09, "Revenue From Contracts With Customers", as amended by ASU's 2015-14, 2016-08, 2016-10, 2016-11, 2016-12, 2016-20 and 2017-05, which outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. ASU 2014-09 is based on the principle that an entity should recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2014-09 also requires disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to fulfill a contract. Entities have the option of using either a full retrospective or a modified retrospective approach for the adoption of the new standard. This update is effective for interim and annual reporting periods beginning after December 15, 2017. We plan to adopt this standard in the first quarter of 2018 using the modified retrospective method, whereby the cumulative effect of applying the standard is recognized at the date of initial application. We have substantially completed our evaluation of significant contracts and the review of our current accounting policies and practices to identify potential differences that would result from applying the requirements of ASU 2014-09 to our revenue contracts. In addition, we have identified, and are in the process of implementing, appropriate changes to business processes, systems and controls to support recognition and disclosure under the new standard. Based on the foregoing, we do not expect the adoption of ASU 2014-09 to have a material impact on the amount and timing of revenue recognized in our Condensed Consolidated Financial Statements. In February 2016, the FASB issued ASU 2016-02, "Leases (Topic 842)," which requires a lessee to recognize on the balance sheet, assets and liabilities for leases with lease terms of more than 12 months. Leases will be classified as either finance or operating leases, with classification affecting the pattern of expense recognition in the income statement. The new guidance also clarifies the definition of a lease and disclosure requirements. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, with early application permitted. Lessees and lessors must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The modified retrospective approach does not require any transition accounting for leases that expired before the earliest comparative period presented. We are currently evaluating the impact of this guidance on our financial statements and related disclosures, including the increase in the assets and liabilities on our balance sheet. To facilitate this, we are utilizing a comprehensive approach to review our lease portfolio, as well as assessing system requirements and control implications. See note 16, Operating Leases, in our 2016 Annual Report on Form 10-K for the year ended December 31, 2016 for our minimum lease commitments under non-cancellable operating leases. In June 2016, the FASB issued ASU 2016-13, "Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments." This standard introduces a new approach to estimating credit losses on certain types of financial instruments, including trade receivables, and modifies the impairment model for available-for-sale debt securities. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years, with early application permitted. We are currently assessing the impact that this standard will have on our Condensed Consolidated Financial Statements. In October 2016, the FASB issued ASU 2016-16, "Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory." ASU 2016-16 clarifies that an entity should recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. ASU 2016-16 is effective for annual and interim reporting periods beginning after December 15, 2017, with early adoption permitted. We are currently assessing the impact that this standard will have on our Condensed Consolidated Financial Statements. In March 2017, the FASB issued ASU 2017-07, "Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Post-retirement Benefit Cost." ASU 2017-07 requires that only the service cost component of pension and post-retirement benefit costs be reported within income from operations. The other components of net benefit cost are required to be presented in the income statement outside of income from operations, if presented. In addition, this ASU allows only the service cost component to be eligible for capitalization when applicable. ASU 2017-07 is effective for annual and interim reporting periods beginning after December 15, 2017, with early adoption permitted. Presentation on the Condensed Consolidated Statements of Operations will be retrospective and any impact to capitalized costs will be prospectively adopted. We plan to adopt this standard in the first quarter of 2018 and expect the impact to be reclassifications of applicable costs and credits from income from operations to other income (expense). In August 2017, the FASB issued ASU 2017-12, "Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities." ASU 2017-12 amends the hedge accounting rules to simplify the application of hedge accounting guidance and better portray the economic results of risk management activities in the financial statements. The guidance expands the ability to hedge nonfinancial and financial risk components, reduces complexity in fair value hedges of interest rate risk, eliminates the requirement to separately measure and report hedge ineffectiveness, and eases certain hedge effectiveness assessment requirements. ASU 2017-12 is effective for annual and interim reporting periods beginning after December 15, 2018, with early adoption permitted. We are currently evaluating the impact of this guidance, including transition elections and required disclosures, on our financial statements and the timing of adoption. |
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Income Tax, Policy | For interim tax reporting, we estimate our annual effective tax rate and apply it to our year-to-date ordinary income. Tax jurisdictions with a projected or year-to-date loss for which a tax benefit cannot be realized are excluded from the annualized effective tax rate. The tax effects of unusual or infrequently occurring items, including changes in judgment about valuation allowances and effects of changes in tax laws or rates, are reported in the interim period in which they occur. |
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Pension and Other Postretirement Plans, Pensions, Policy | We have pension plans covering the majority of our employees. Benefits generally are based on compensation and service for salaried employees and job grade and length of service for hourly employees. In addition, we have an unfunded supplemental employee retirement plan (SERP) that covers certain salaried U.S.-based employees of Libbey hired before January 1, 2006. The U.S. pension plans cover the salaried U.S.-based employees of Libbey hired before January 1, 2006, and most hourly U.S.-based employees (excluding employees hired at Shreveport after December 15, 2008 and at Toledo after September 30, 2010). Effective January 1, 2013, we ceased annual company contribution credits to the cash balance accounts in our Libbey U.S. Salaried Pension Plan and SERP. The non-U.S. pension plans cover the employees of our wholly owned subsidiary in Mexico and are unfunded. |
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Pension and Other Postretirement Plans, Nonpension Benefits, Policy | We provide certain retiree health care and life insurance benefits covering our U.S. and Canadian salaried employees hired before January 1, 2004, and a majority of our union hourly employees (excluding employees hired at Shreveport after December 15, 2008 and at Toledo after September 30, 2010). Employees are generally eligible for benefits upon retirement and completion of a specified number of years of creditable service. Benefits for most hourly retirees are determined by collective bargaining. The U.S. non-pension, post-retirement plans cover the hourly and salaried U.S.-based employees of Libbey (excluding those mentioned above). The non-U.S., non-pension, post-retirement plans cover the retirees and active employees of Libbey who are located in Canada. The post-retirement benefit plans are unfunded. |
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Earnings Per Share, Policy | When applicable, diluted shares outstanding include the dilutive impact of restricted stock units. Diluted shares also include the impact of eligible employee stock options, which are calculated based on the average share price for each fiscal period using the treasury stock method. As part of the adoption of ASU 2016-09 as of January 1, 2017, anticipated tax windfalls and shortfalls are no longer included in the calculation of assumed proceeds when applying the treasury stock method. |
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Derivatives, Policy | Derivatives We utilize derivative financial instruments to hedge certain interest rate risks associated with our long-term debt, commodity price risks associated with forecasted future natural gas requirements and foreign exchange rate risks associated with transactions denominated in a currency other than the U.S. dollar. These derivatives, except for the foreign currency contracts and the natural gas contracts used in our Mexican manufacturing facilities, qualify for hedge accounting since the hedges are highly effective, and we have designated and documented contemporaneously the hedging relationships involving these derivative instruments. While we intend to continue to meet the conditions for hedge accounting, if hedges do not qualify as highly effective or if we do not believe that forecasted transactions would occur, the changes in the fair value of the derivatives used as hedges would be reflected in our earnings. |
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Segment Reporting, Policy | Segments Our reporting segments align with our regionally focused organizational structure, which we believe enables us to better serve customers across the globe. Under this structure, we report financial results for U.S. and Canada; Latin America; Europe, the Middle East and Africa (EMEA); and Other. Segment results are based primarily on the geographical destination of the sale. In the first quarter of 2017, net sales and related costs for certain countries were reclassified between segments to align with changes in business unit responsibilities. Accordingly, 2016 segment results have been reclassified to conform with the revised structure. The revised 2016 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, as well as glass products for OEMs regardless of end–market destination. 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. Segment EBIT also includes an allocation of manufacturing costs for inventory produced at a Libbey facility that is located in a region other than the end market in which the inventory is sold. This allocation can fluctuate from year to year based on the relative demands for products produced in regions other than the end markets in which they are sold. As the gain (loss) on mark-to-market natural gas contracts is considered representative of our ongoing operations, it is included in Segment EBIT in 2017; the prior year derivative amount originally excluded from Segment EBIT in 2016 has been reclassified and included in Segment EBIT to conform to the current year presentation. 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. |
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Fair Value of Financial Instruments, Policy | The fair values of our commodity futures natural gas contracts are determined using observable market inputs. The fair value of our interest rate swap is based on the market standard methodology of netting the discounted expected future variable cash receipts and the discounted future fixed cash payments. The variable cash receipts are based on an expectation of future interest rates derived from observed market interest rate forward curves. Since these inputs are observable in active markets over the terms that the instruments are held, the derivatives are classified as Level 2 in the hierarchy. We also evaluate Company and counterparty risk in determining fair values. The commodity futures natural gas contracts and interest rate swap are hedges of either recorded assets or liabilities or anticipated transactions. |
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Goodwill, Policy | When performing our test for impairment, we measured each reporting unit's fair value using a combination of "income" and "market" approaches on a shipping point basis. The income approach calculates the fair value of the reporting unit based on a discounted cash flow analysis, incorporating the weighted average cost of capital of a hypothetical third party buyer. Significant estimates in the income approach include the following: discount rate; expected financial outlook and profitability of the reporting unit's business; and foreign currency impacts (all Level 3 inputs in the fair value hierarchy). Discount rates use the weighted average cost of capital for companies within our peer group, adjusted for specific company risk premium factors. The market approach uses the "Guideline Company" method, which calculates the fair value of the reporting unit based on a comparison of the reporting unit to comparable publicly traded companies. Significant estimates in the market approach model include identifying similar companies with comparable business factors such as size, growth, profitability, risk and return on investment, assessing comparable multiples, as well as consideration of control premiums (Level 2 inputs). The blended approach assigns a 70 percent weighting to the income approach and 30 percent to the market approach (Level 3 input). The higher weighting is given to the income approach due to some limitations of publicly available peer information used in the market approach. The blended fair value of both approaches is then compared to the carrying value, and to the extent that fair value exceeds the carrying value, no impairment exists. However, to the extent the carrying value exceeds the fair value, an impairment is recorded. |
Significant Accounting Policies (Tables) |
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Accounting Policies [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Table Text Block] | Stock-based compensation expense charged to the Condensed Consolidated Statements of Operations is as follows:
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Balance Sheet Details (Tables) |
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Schedule of Other Assets and Other Liabilities [Table Text Block] | The following table provides detail of selected balance sheet items:
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Borrowings (Tables) |
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Schedule of Debt [Table Text Block] | Borrowings consist of the following:
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Defined Benefit Plan Disclosure [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Net Benefit Costs [Table Text Block] | The components of our net pension expense, including the SERP, are as follows:
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Non-Pension Postretirement Benefit Plans | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Defined Benefit Plan Disclosure [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Net Benefit Costs [Table Text Block] | The provision for our non-pension post-retirement benefit expense consists of the following:
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Net Income (Loss) per Share of Common Stock (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | The following table sets forth the computation of basic and diluted earnings (loss) per share:
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Derivatives (Tables) |
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Derivative Instruments, Gain (Loss) [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Derivative Assets and Liabilities at Fair Value | The following table provides the fair values of our derivative financial instruments for the periods presented:
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Summary of the Effective Portion of Derivative Gain (Loss) Recognized in Other Comprehensive Income (Loss) | The following table provides a summary of the effective portion of derivative gain (loss) recognized in other comprehensive income (loss) from our natural gas contracts:
The following table provides a summary of the effective portion of derivative gain (loss) recognized in other comprehensive income (loss) from our interest rate swap:
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Reclassification out of Accumulated Other Comprehensive Income | The following table provides a summary of the effective portion of derivative reclassified from accumulated other comprehensive income (loss) to the Condensed Consolidated Statements of Operations from our interest rate swap:
The following table provides a summary of the effective portion of derivative reclassified from accumulated other comprehensive loss to the Condensed Consolidated Statements of Operations from our natural gas contracts:
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Summary of Derivatives Not Designated as Hedging Instruments Recognized in the Statement of Operations | Gains (losses) on currency derivatives that were not designated as hedging instruments are recorded in other income (expense) as follows:
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Natural Gas Contracts | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of the Gain (Loss) Recognized in the Statement of Operations | The following table provides a summary of the gain (loss) recognized in other income (expense) in the Condensed Consolidated Statements of Operations from our natural gas contracts in Mexico:
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Accumulated Other Comprehensive Income (Loss) (Tables) |
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Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block] | Accumulated other comprehensive loss, net of tax, is as follows:
___________________________ (1) These accumulated other comprehensive income components are included in the computation of net periodic benefit cost within the cost of sales and selling, general and administrative expenses on the Condensed Consolidated Statements of Operations. |
Segments (Tables) |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation from Segment Totals to Consolidated [Table Text Block] |
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Fair Value (Tables) |
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Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements, Recurring and Nonrecurring [Table Text Block] |
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Fair Value Disclosures, Carrying Value and Estimated Fair Value of Debt Instruments [Table Text Block] | Financial instruments carried at cost on the Condensed Consolidated Balance Sheets, as well as the related fair values, are as follows:
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Other Income (Expense) (Tables) |
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Other Income and Expenses [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Nonoperating Income (Expense) [Table Text Block] | Items included in other income (expense) in the Condensed Consolidated Statements of Operations are as follows:
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Goodwill (Tables) |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Changes in Goodwill | Changes in the carrying amount of goodwill by segment for the nine months ended September 30, 2017 are as follows:
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Description of the Business (Details) |
Sep. 30, 2017
plant
country
|
---|---|
Production Operations | |
Description of Business [Line Items] | |
Number of countries in which entity operates | 5 |
Sales Operations | Minimum | |
Description of Business [Line Items] | |
Number of countries in which entity operates | 100 |
United States | |
Description of Business [Line Items] | |
Number of glass tableware manufacturing plants | plant | 2 |
Significant Accounting Policies (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
Jan. 01, 2017 |
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Accounting Policies [Abstract] | |||||
Stock-based compensation expense | $ 782 | $ 1,011 | $ 2,930 | $ 4,334 | |
Retained Deficit | Accounting Standards Update 2016-09 [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Effects on Equity and Net Assets | $ 2,300 | ||||
Deferred income taxes | Accounting Standards Update 2016-09 [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Effects on Equity and Net Assets | $ (2,300) |
Balance Sheet Details (Details) - USD ($) $ in Thousands |
Sep. 30, 2017 |
Dec. 31, 2016 |
---|---|---|
Accounts receivable: | ||
Accounts receivable | $ 89,084 | $ 85,113 |
Allowance for doubtful accounts | 7,176 | 7,832 |
Inventories: | ||
Finished goods | 183,212 | 152,261 |
Work in process | 1,456 | 1,625 |
Raw materials | 3,549 | 4,432 |
Repair parts | 10,645 | 10,558 |
Operating supplies | 1,319 | 1,133 |
Total inventories, less loss provisions of $10,727 and $9,484 | 200,181 | 170,009 |
Inventory loss provisions | 10,727 | 9,484 |
Accrued liabilities: | ||
Accrued incentives | 24,674 | 19,771 |
Other accrued liabilities | 24,837 | 22,036 |
Total accrued liabilities | 49,511 | 41,807 |
Trade receivables | ||
Accounts receivable: | ||
Accounts receivable | 87,315 | 82,851 |
Other receivables | ||
Accounts receivable: | ||
Accounts receivable | $ 1,769 | $ 2,262 |
Borrowings (ABL Credit Agreement Narrative) (Details) - Subsidiaries, Libbey Glass and Libbey Europe [Member] - Asset-backed Loan Facility - USD ($) $ in Millions |
Sep. 30, 2017 |
Dec. 31, 2016 |
---|---|---|
Line of Credit | ||
Debt Instrument [Line Items] | ||
Line of Credit Facility, Current Borrowing Capacity, Amount of Rent Reserves Offset | $ 0.5 | |
Line of Credit Facility, Current Borrowing Capacity, Amount of Natural Gas Derivative Offset | 0.1 | |
Line of credit facility, maximum borrowing capacity | 100.0 | |
Line of credit facility, remaining borrowing capacity | 83.5 | $ 88.4 |
Letter of Credit | ||
Debt Instrument [Line Items] | ||
Line of credit facility, maximum borrowing capacity | 30.0 | |
Line of credit facility, amount outstanding | $ 7.2 |
Income Taxes (Details) $ in Millions, MXN in Billions |
9 Months Ended | |||
---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Aug. 31, 2016
USD ($)
|
Aug. 31, 2016
MXN
|
|
Effective Income Tax Rate Reconciliation, Percent [Abstract] | ||||
Effective income tax rate, continuing operations | (2.00%) | 49.30% | ||
Impact of goodwill impairment | (40.20%) | |||
Timing and mix of pretax income with rates lower than US | 13.70% | 5.90% | ||
Impact of foreign exchange | (5.30%) | (15.40%) | ||
Other reconciling items | (5.20%) | 23.80% | ||
Mexican Tax Authority | Tax Year 2010 | ||||
Income Tax Contingency [Line Items] | ||||
Number of subsidiaries in a tax assessment | 1 | 1 | ||
Tax assessment | $ 157 | MXN 3 |
Pension and Non-pension Postretirement Benefits (Net Benefit Costs) (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
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Defined Benefit Pension Plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | $ 1,265 | $ 1,242 | $ 3,751 | $ 3,736 |
Interest cost | 4,170 | 4,403 | 12,400 | 13,227 |
Expected return on plan assets | (5,619) | (5,757) | (16,859) | (17,272) |
Amortization of unrecognized: | ||||
Prior service cost (credit) | 5 | 12 | 24 | 37 |
Actuarial loss / (gain) | 1,464 | 1,480 | 4,371 | 4,021 |
Settlement charge | 0 | 212 | ||
Pension expense or non-pension postretirement benefit expense | 1,285 | 1,380 | 3,687 | 3,961 |
Defined Benefit Plan, Contributions [Abstract] | ||||
Employer contributions made to defined benefit plans | 600 | 2,600 | ||
Estimated employer contributions to defined benefit plans in remainder of 2017 | 500 | 500 | ||
Defined Benefit Pension Plan | Domestic Plan [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 979 | 929 | 2,937 | 2,788 |
Interest cost | 3,445 | 3,740 | 10,337 | 11,222 |
Expected return on plan assets | (5,619) | (5,757) | (16,859) | (17,272) |
Amortization of unrecognized: | ||||
Prior service cost (credit) | 59 | 65 | 177 | 197 |
Actuarial loss / (gain) | 1,308 | 1,068 | 3,925 | 3,204 |
Settlement charge | 0 | 42 | ||
Pension expense or non-pension postretirement benefit expense | 172 | 45 | 517 | 181 |
Defined Benefit Pension Plan | Foreign Plan [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 286 | 313 | 814 | 948 |
Interest cost | 725 | 663 | 2,063 | 2,005 |
Expected return on plan assets | 0 | 0 | 0 | 0 |
Amortization of unrecognized: | ||||
Prior service cost (credit) | (54) | (53) | (153) | (160) |
Actuarial loss / (gain) | 156 | 412 | 446 | 817 |
Settlement charge | 0 | 170 | ||
Pension expense or non-pension postretirement benefit expense | 1,113 | 1,335 | 3,170 | 3,780 |
Non-Pension Postretirement Benefit Plans | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 157 | 200 | 474 | 599 |
Interest cost | 536 | 663 | 1,610 | 1,991 |
Amortization of unrecognized: | ||||
Prior service cost (credit) | (50) | 35 | (151) | 105 |
Actuarial loss / (gain) | (78) | 11 | (233) | 29 |
Pension expense or non-pension postretirement benefit expense | 565 | 909 | 1,700 | 2,724 |
Defined Benefit Plan, Contributions [Abstract] | ||||
Employer contributions made to defined benefit plans | 1,000 | 2,600 | ||
Estimated employer contributions to defined benefit plans in year 2017 | 4,000 | 4,000 | ||
Non-Pension Postretirement Benefit Plans | Domestic Plan [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 157 | 200 | 473 | 598 |
Interest cost | 526 | 652 | 1,578 | 1,956 |
Amortization of unrecognized: | ||||
Prior service cost (credit) | (50) | 35 | (151) | 105 |
Actuarial loss / (gain) | (65) | 21 | (194) | 61 |
Pension expense or non-pension postretirement benefit expense | 568 | 908 | 1,706 | 2,720 |
Non-Pension Postretirement Benefit Plans | Foreign Plan [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 0 | 0 | 1 | 1 |
Interest cost | 10 | 11 | 32 | 35 |
Amortization of unrecognized: | ||||
Prior service cost (credit) | 0 | 0 | 0 | 0 |
Actuarial loss / (gain) | (13) | (10) | (39) | (32) |
Pension expense or non-pension postretirement benefit expense | $ (3) | $ 1 | $ (6) | $ 4 |
Net Income (Loss) per Share of Common Stock (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
|
Numerator for earnings per share: | ||||
Net income (loss) that is available to common shareholders | $ (78,815) | $ 2,909 | $ (86,217) | $ 12,322 |
Denominator for basic earnings per share: | ||||
Weighted average shares outstanding | 22,075,318 | 21,894,017 | 22,015,008 | 21,869,922 |
Denominator for diluted earnings per share: | ||||
Effect of stock options and restricted stock units | 0 | 177,176 | 0 | 156,304 |
Adjusted weighted average shares and assumed conversions | 22,075,318 | 22,071,193 | 22,015,008 | 22,026,226 |
Basic earnings (loss) per share | $ (3.57) | $ 0.13 | $ (3.92) | $ 0.56 |
Diluted earnings (loss) per share | $ (3.57) | $ 0.13 | $ (3.92) | $ 0.56 |
Net loss position (excluded from denominator) | ||||
Shares excluded from diluted earnings (loss) per share due to: | ||||
Shares excluded from diluted earnings (loss) per share due to: | 63,488 | 0 | 92,051 | 0 |
Inclusion would have been anti-dilutive (excluded from calculation) | ||||
Shares excluded from diluted earnings (loss) per share due to: | ||||
Shares excluded from diluted earnings (loss) per share due to: | 893,198 | 605,032 | 780,062 | 619,058 |
Derivatives (Fair Value of Derivative Assets and Liabilities) (Details) - USD ($) $ in Thousands |
Sep. 30, 2017 |
Dec. 31, 2016 |
---|---|---|
Derivatives, Fair Value [Line Items] | ||
Fair value, derivative asset | $ 8 | $ 1,508 |
Fair value, derivative liability | 1,055 | 2,035 |
Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Fair value, derivative asset | 8 | 747 |
Fair value, derivative liability | 993 | 2,035 |
Not Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Fair value, derivative asset | 0 | 761 |
Fair value, derivative liability | 62 | 0 |
Natural Gas Contracts | Designated as Hedging Instrument | Prepaid and other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Fair value, derivative asset | 0 | 702 |
Natural Gas Contracts | Designated as Hedging Instrument | Other assets | ||
Derivatives, Fair Value [Line Items] | ||
Fair value, derivative asset | 8 | 45 |
Natural Gas Contracts | Designated as Hedging Instrument | Derivative liability, current | ||
Derivatives, Fair Value [Line Items] | ||
Fair value, derivative liability | 45 | 0 |
Natural Gas Contracts | Not Designated as Hedging Instrument | Prepaid and other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Fair value, derivative asset | 0 | 732 |
Natural Gas Contracts | Not Designated as Hedging Instrument | Other assets | ||
Derivatives, Fair Value [Line Items] | ||
Fair value, derivative asset | 0 | 29 |
Natural Gas Contracts | Not Designated as Hedging Instrument | Derivative liability, current | ||
Derivatives, Fair Value [Line Items] | ||
Fair value, derivative liability | 57 | 0 |
Natural Gas Contracts | Not Designated as Hedging Instrument | Other long-term liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Fair value, derivative liability | 5 | 0 |
Interest Rate Swap | Designated as Hedging Instrument | Derivative liability, current | ||
Derivatives, Fair Value [Line Items] | ||
Fair value, derivative liability | 852 | 1,928 |
Interest Rate Swap | Designated as Hedging Instrument | Other long-term liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Fair value, derivative liability | $ 96 | $ 107 |
Derivatives (Narrative - Commodity Future Contracts) (Details) - Cash Flow Hedging - Natural Gas Contracts $ in Millions |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2017
USD ($)
MMBTU
|
Sep. 30, 2016
USD ($)
|
Sep. 30, 2017
USD ($)
MMBTU
|
Sep. 30, 2016
USD ($)
|
Dec. 31, 2016
MMBTU
|
|
Derivative [Line Items] | |||||
Forecast of commodity requirements, maximum length of time used | 18 months | ||||
Natural gas contracts, notional amounts (in millions of BTUs) | MMBTU | 2,590,000 | 2,590,000 | 2,590,000 | ||
Derivative, Cash Received on Hedge | $ 0.2 | ||||
Derivative, Additional Cash Paid on Settlement of Hedge | $ 0.1 | $ 0.1 | $ 2.3 | ||
Minimum | |||||
Derivative [Line Items] | |||||
Forecast of anticipated requirements, percentage of forecast eligible for hedging | 40.00% | 40.00% | |||
Maximum | |||||
Derivative [Line Items] | |||||
Forecast of anticipated requirements, percentage of forecast eligible for hedging | 70.00% | 70.00% |
Derivatives (Effective Portion of Derivative Gain Loss) (Details) - Designated as Hedging Instrument - Natural Gas Contracts - Cash Flow Hedging - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
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Derivative Instruments, Gain (Loss) [Line Items] | ||||
Effective portion of derivative gain (loss) recognized in other comprehensive income (loss) | $ 6 | $ (35) | $ (703) | $ 59 |
Effective portion of derivative gain (loss) reclassified from accumulated other comprehensive loss into income (loss) | (76) | (41) | 81 | (1,096) |
Cost of Sales | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Effective portion of derivative gain (loss) reclassified from accumulated other comprehensive loss into income (loss) | $ (76) | $ (41) | $ 81 | $ (1,096) |
Derivatives (Natural Gas Gain Loss Included in Other Income and Expense) (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
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Derivative [Line Items] | ||||
Gain (loss) on contracts where hedge accounting was not elected | $ 0 | $ 106 | $ 0 | $ (281) |
Natural Gas Contracts | Other Income (Expense) | Cash Flow Hedging | ||||
Derivative [Line Items] | ||||
Gain (loss) on contracts where hedge accounting was not elected | (4) | 11 | (823) | 1,150 |
Gain (loss) on derivative, net | $ (4) | $ 11 | $ (823) | $ 1,150 |
Derivatives (Interest Rate Swap) (Details) - Interest Rate Swap - Cash Flow Hedging - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
|
Interest Expense | ||||
Derivative [Line Items] | ||||
Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months | $ (900) | |||
Senior Loans | ||||
Derivative [Line Items] | ||||
Derivative, Notional Amount | $ 220,000 | $ 220,000 | ||
Derivative, Fixed Interest Rate | 4.85% | 4.85% | ||
Designated as Hedging Instrument | ||||
Derivative [Line Items] | ||||
Effective portion of derivative gain (loss) recognized in other comprehensive income (loss) | $ 87 | $ 6 | $ (328) | $ (4,816) |
Effective portion of derivative gain (loss) reclassified from accumulated other comprehensive loss into income (loss) | (358) | (767) | (1,415) | (1,778) |
Designated as Hedging Instrument | Interest Expense | ||||
Derivative [Line Items] | ||||
Effective portion of derivative gain (loss) reclassified from accumulated other comprehensive loss into income (loss) | $ (358) | $ (767) | $ (1,415) | $ (1,778) |
Derivatives (Currency Contracts) (Details) $ in Thousands, CAD in Millions |
3 Months Ended | 9 Months Ended | ||||
---|---|---|---|---|---|---|
Sep. 30, 2017
USD ($)
|
Sep. 30, 2016
USD ($)
|
Sep. 30, 2017
USD ($)
|
Sep. 30, 2016
USD ($)
|
Sep. 30, 2017
CAD
|
Dec. 31, 2016
CAD
|
|
Derivative [Line Items] | ||||||
Gain (loss) on derivatives not designated as hedging instruments | $ 0 | $ 106 | $ 0 | $ (281) | ||
Other Income (Expense) | Currency Contracts | ||||||
Derivative [Line Items] | ||||||
Gain (loss) on derivatives not designated as hedging instruments | $ 0 | $ 106 | $ 0 | $ (281) | ||
Not Designated as Hedging Instrument | Currency Contracts | ||||||
Derivative [Line Items] | ||||||
Derivative, Notional Amount | CAD | CAD 0.0 | CAD 0.0 |
Accumulated Other Comprehensive Income (Loss) (Schedule of AOCI) (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | |||||
---|---|---|---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
||||
Change in Accumulated Other Comprehensive Loss [Roll Forward] | |||||||
Beginning balance | $ (115,148) | $ (117,580) | $ (125,197) | $ (120,232) | |||
Other comprehensive income (loss) | 3,570 | 378 | 14,244 | (1,543) | |||
Currency impact | 110 | (31) | (628) | 481 | |||
Amounts reclassified from accumulated other comprehensive income (loss): | |||||||
Amortization of actuarial loss (1) | [1] | 1,386 | 1,491 | 4,138 | 4,050 | ||
Amortization of prior service cost (credit) (1) | [1] | (45) | 47 | (127) | 142 | ||
Cost of sales | 76 | 41 | (81) | 1,096 | |||
Interest expense | 358 | 767 | 1,415 | 1,778 | |||
Current-period other comprehensive income (loss) | 5,455 | 2,693 | 18,961 | 6,004 | |||
Tax effect | (786) | (644) | (4,243) | (1,303) | |||
Ending balance | (110,479) | (115,531) | (110,479) | (115,531) | |||
Foreign Currency Translation | |||||||
Change in Accumulated Other Comprehensive Loss [Roll Forward] | |||||||
Beginning balance | (20,831) | (22,587) | (27,828) | (22,913) | |||
Other comprehensive income (loss) | 3,477 | 407 | 10,474 | 459 | |||
Amounts reclassified from accumulated other comprehensive income (loss): | |||||||
Current-period other comprehensive income (loss) | 3,477 | 407 | 10,474 | 459 | |||
Tax effect | (827) | 78 | (827) | 352 | |||
Ending balance | (18,181) | (22,102) | (18,181) | (22,102) | |||
Derivative Instruments | |||||||
Change in Accumulated Other Comprehensive Loss [Roll Forward] | |||||||
Beginning balance | (913) | (3,561) | (515) | (1,860) | |||
Other comprehensive income (loss) | 93 | (29) | (1,031) | (4,757) | |||
Amounts reclassified from accumulated other comprehensive income (loss): | |||||||
Cost of sales | 76 | 41 | (81) | 1,096 | |||
Interest expense | 358 | 767 | 1,415 | 1,778 | |||
Current-period other comprehensive income (loss) | 527 | 779 | 303 | (1,883) | |||
Tax effect | 70 | (278) | (104) | 683 | |||
Ending balance | (316) | (3,060) | (316) | (3,060) | |||
Pension and Other Postretirement Benefits | |||||||
Change in Accumulated Other Comprehensive Loss [Roll Forward] | |||||||
Beginning balance | (93,404) | (91,432) | (96,854) | (95,459) | |||
Other comprehensive income (loss) | 0 | 0 | 4,801 | 2,755 | |||
Currency impact | 110 | (31) | (628) | 481 | |||
Amounts reclassified from accumulated other comprehensive income (loss): | |||||||
Amortization of actuarial loss (1) | [1] | 1,386 | 1,491 | 4,138 | 4,050 | ||
Amortization of prior service cost (credit) (1) | [1] | (45) | 47 | (127) | 142 | ||
Current-period other comprehensive income (loss) | 1,451 | 1,507 | 8,184 | 7,428 | |||
Tax effect | (29) | (444) | (3,312) | (2,338) | |||
Ending balance | $ (91,982) | $ (90,369) | $ (91,982) | $ (90,369) | |||
|
Segments (Details) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2017
USD ($)
|
Sep. 30, 2016
USD ($)
|
Sep. 30, 2017
USD ($)
segment
|
Sep. 30, 2016
USD ($)
|
|
Segment Reporting Information [Line Items] | ||||
Number of reportable segments | segment | 3 | |||
Net Sales: | ||||
Net sales | $ 187,339 | $ 196,873 | $ 557,847 | $ 587,582 |
Segment EBIT: | ||||
Segment EBIT | 14,435 | 20,417 | 30,846 | 72,170 |
Reconciliation of Segment EBIT to Net Income (Loss): | ||||
Retained corporate costs | (5,701) | (6,925) | (18,087) | (20,699) |
Goodwill impairment (note 14) | (79,700) | 0 | (79,700) | 0 |
Pension settlement | 0 | 0 | 0 | (212) |
Reorganization charges | 0 | 0 | (2,488) | 0 |
Product portfolio optimization | 0 | 0 | 0 | (6,784) |
Executive terminations | 0 | 98 | 0 | (4,521) |
Interest expense | (5,118) | (5,231) | (15,123) | (15,629) |
Provision for income taxes | (2,731) | (5,450) | (1,665) | (12,003) |
Net income (loss) | (78,815) | 2,909 | (86,217) | 12,322 |
Depreciation & Amortization: | ||||
Depreciation and amortization | 11,233 | 11,234 | 33,616 | 36,669 |
Capital Expenditures: | ||||
Capital Expenditures | 12,092 | 8,012 | 39,140 | 23,523 |
United States & Canada | ||||
Net Sales: | ||||
Net sales | 112,252 | 117,268 | 343,452 | 354,381 |
Segment EBIT: | ||||
Segment EBIT | 10,761 | 18,635 | 33,307 | 55,932 |
Depreciation & Amortization: | ||||
Depreciation and amortization | 2,850 | 2,883 | 9,016 | 9,718 |
Capital Expenditures: | ||||
Capital Expenditures | 2,751 | 3,037 | 7,145 | 9,030 |
Latin America | ||||
Net Sales: | ||||
Net sales | 35,339 | 40,149 | 102,564 | 114,971 |
Segment EBIT: | ||||
Segment EBIT | 3,721 | 1,954 | 2,549 | 15,226 |
Reconciliation of Segment EBIT to Net Income (Loss): | ||||
Goodwill impairment (note 14) | (79,700) | |||
Depreciation & Amortization: | ||||
Depreciation and amortization | 4,850 | 4,667 | 13,757 | 13,725 |
Capital Expenditures: | ||||
Capital Expenditures | 3,937 | 2,041 | 15,401 | 5,717 |
EMEA | ||||
Net Sales: | ||||
Net sales | 33,743 | 32,489 | 90,128 | 93,058 |
Segment EBIT: | ||||
Segment EBIT | 1,482 | 175 | (1,412) | 33 |
Reconciliation of Segment EBIT to Net Income (Loss): | ||||
Goodwill impairment (note 14) | 0 | |||
Depreciation & Amortization: | ||||
Depreciation and amortization | 1,816 | 1,885 | 5,508 | 7,660 |
Capital Expenditures: | ||||
Capital Expenditures | 5,050 | 1,549 | 15,446 | 4,656 |
Other Segments | ||||
Net Sales: | ||||
Net sales | 6,005 | 6,967 | 21,703 | 25,172 |
Segment EBIT: | ||||
Segment EBIT | (1,529) | (347) | (3,598) | 979 |
Depreciation & Amortization: | ||||
Depreciation and amortization | 1,138 | 1,325 | 3,821 | 4,162 |
Capital Expenditures: | ||||
Capital Expenditures | 348 | 939 | 816 | 2,529 |
Corporate | ||||
Depreciation & Amortization: | ||||
Depreciation and amortization | 579 | 474 | 1,514 | 1,404 |
Capital Expenditures: | ||||
Capital Expenditures | $ 6 | $ 446 | $ 332 | $ 1,591 |
Fair Value (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands |
Sep. 30, 2017 |
Dec. 31, 2016 |
---|---|---|
Level 1 | ||
Fair Value of Financial Instruments | ||
Net derivative asset (liability) | $ 0 | $ 0 |
Level 2 | ||
Fair Value of Financial Instruments | ||
Net derivative asset (liability) | (1,047) | (527) |
Level 3 | ||
Fair Value of Financial Instruments | ||
Net derivative asset (liability) | 0 | 0 |
Commodity futures natural gas contracts | Level 1 | ||
Fair Value of Financial Instruments | ||
Net derivative asset (liability) | 0 | 0 |
Commodity futures natural gas contracts | Level 2 | ||
Fair Value of Financial Instruments | ||
Net derivative asset (liability) | (99) | 1,508 |
Commodity futures natural gas contracts | Level 3 | ||
Fair Value of Financial Instruments | ||
Net derivative asset (liability) | 0 | 0 |
Interest Rate Swap | Level 1 | ||
Fair Value of Financial Instruments | ||
Net derivative asset (liability) | 0 | 0 |
Interest Rate Swap | Level 2 | ||
Fair Value of Financial Instruments | ||
Net derivative asset (liability) | (948) | (2,035) |
Interest Rate Swap | Level 3 | ||
Fair Value of Financial Instruments | ||
Net derivative asset (liability) | 0 | 0 |
Total | ||
Fair Value of Financial Instruments | ||
Net derivative asset (liability) | (1,047) | (527) |
Total | Commodity futures natural gas contracts | ||
Fair Value of Financial Instruments | ||
Net derivative asset (liability) | (99) | 1,508 |
Total | Interest Rate Swap | ||
Fair Value of Financial Instruments | ||
Net derivative asset (liability) | $ (948) | $ (2,035) |
Fair Value (Debt Disclosure) (Details) - USD ($) $ in Thousands |
Sep. 30, 2017 |
Dec. 31, 2016 |
||
---|---|---|---|---|
Value of Financial Instruments | ||||
Term Loan B, Carrying Value | $ 402,470 | $ 412,320 | ||
Senior Loans | Subsidiary, Libbey Glass | ||||
Value of Financial Instruments | ||||
Term Loan B, Carrying Value | [1] | 390,700 | 409,000 | |
Level 2 | Senior Loans | Subsidiary, Libbey Glass | ||||
Value of Financial Instruments | ||||
Term Loan B, Fair Value | $ 359,444 | $ 412,068 | ||
|
Other Income (Expense) (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
|
Component of Other Income (Expense), Nonoperating [Line Items] | ||||
Other income (expense) | $ 621 | $ 248 | $ (2,283) | $ 1,035 |
Gain (loss) on currency transactions | ||||
Component of Other Income (Expense), Nonoperating [Line Items] | ||||
Other income (expense) | 548 | 348 | (1,687) | (376) |
Gain (loss) on mark-to-market natural gas contracts | ||||
Component of Other Income (Expense), Nonoperating [Line Items] | ||||
Other income (expense) | (4) | 11 | (823) | 1,150 |
Other Non-Operating Income (Expense) | ||||
Component of Other Income (Expense), Nonoperating [Line Items] | ||||
Other income (expense) | $ 77 | $ (111) | $ 227 | $ 261 |
Environmental Liability (Details) |
9 Months Ended | ||
---|---|---|---|
Oct. 30, 2009 |
Sep. 30, 2017
USD ($)
|
Dec. 31, 2016
USD ($)
|
|
Site Contingency [Line Items] | |||
Site Contingency, Number of Potentially Responsible Parties | 8 | ||
Syracuse China | |||
Site Contingency [Line Items] | |||
Site Contingency, Number of Potentially Responsible Related Parties | 1 | ||
Unfavorable Regulatory Action | Motors Liquidation | |||
Site Contingency [Line Items] | |||
Loss Contingency, Damages Paid, Value | $ 22,000,000 | ||
Other long-term liabilities | Unfavorable Regulatory Action | |||
Site Contingency [Line Items] | |||
Accrued Environmental Loss Contingencies, Noncurrent | 800,000 | $ 900,000 | |
Other Noncurrent Assets | Unfavorable Regulatory Action | |||
Site Contingency [Line Items] | |||
Recorded Third-Party Environmental Recoveries, Noncurrent | 400,000 | $ 500,000 | |
Minimum | Unfavorable Regulatory Action | |||
Site Contingency [Line Items] | |||
Site Contingency, Loss Exposure Not Accrued, Best Estimate | 17,000,000 | ||
Loss Contingency, Range of Possible Loss, Minimum | 0 | ||
Maximum | Unfavorable Regulatory Action | |||
Site Contingency [Line Items] | |||
Site Contingency, Loss Exposure Not Accrued, Best Estimate | $ 24,800,000 |
Goodwill (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2017 |
Sep. 30, 2016 |
Sep. 30, 2017 |
Sep. 30, 2016 |
|
Goodwill [Line Items] | ||||
Fair Value Inputs, Basis Spread on Discount Rate (measured in bps) | 70 | |||
Goodwill [Roll Forward] | ||||
Goodwill | $ 178,987 | |||
Accumulated impairment Losses | (14,875) | |||
Goodwill, net beginning balance | 164,112 | |||
Goodwill impairment | $ (79,700) | $ 0 | (79,700) | $ 0 |
Goodwill, ending balance | 178,987 | 178,987 | ||
Accumulated impairment Losses | (94,575) | (94,575) | ||
Goodwill, net ending balance | 84,412 | $ 84,412 | ||
Income Approach Valuation Technique [Member] | ||||
Goodwill [Line Items] | ||||
Fair Value, Goodwill, Valuation Approach Allocation | 70.00% | |||
Market Approach Valuation Technique [Member] | ||||
Goodwill [Line Items] | ||||
Fair Value, Goodwill, Valuation Approach Allocation | 30.00% | |||
United States & Canada | ||||
Goodwill [Roll Forward] | ||||
Goodwill | $ 43,872 | |||
Accumulated impairment Losses | (5,441) | |||
Goodwill, net beginning balance | 38,431 | |||
Goodwill impairment | 0 | |||
Goodwill, ending balance | 43,872 | 43,872 | ||
Accumulated impairment Losses | (5,441) | (5,441) | ||
Goodwill, net ending balance | 38,431 | 38,431 | ||
Latin America | ||||
Goodwill [Roll Forward] | ||||
Goodwill | 125,681 | |||
Accumulated impairment Losses | 0 | |||
Goodwill, net beginning balance | 125,681 | |||
Goodwill impairment | (79,700) | |||
Goodwill, ending balance | 125,681 | 125,681 | ||
Accumulated impairment Losses | (79,700) | (79,700) | ||
Goodwill, net ending balance | 45,981 | 45,981 | ||
EMEA | ||||
Goodwill [Roll Forward] | ||||
Goodwill | 9,434 | |||
Accumulated impairment Losses | (9,434) | |||
Goodwill, net beginning balance | 0 | |||
Goodwill impairment | 0 | |||
Goodwill, ending balance | 9,434 | 9,434 | ||
Accumulated impairment Losses | (9,434) | (9,434) | ||
Goodwill, net ending balance | $ 0 | $ 0 |
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