Net Income per Share of Common Stock

6 Months Ended

Jun. 30, 2011

Net Income per Share of Common Stock [Abstract]

Net Income per Share of Common Stock

8. Net Income per Share of Common Stock

The following table sets forth the computation of basic and diluted earnings per share:

	Three Months Ended June 30,				Six months Ended June 30,
(dollars in thousands, except earnings per share)	2011		2010		2011		2010
Numerators for earnings per share —
—Net income that is available to common shareholders	$	15,406	$	9,567	$	14,405	$	64,977
Denominator for basic earnings per share —
Weighted average shares outstanding		20,099,003		16,352,049		20,027,493		16,307,955
Effect of stock options and restricted stock units		627,566		535,143		642,300		430,018
Effect of warrants		134,877		3,553,443		142,577		3,506,553
Total effect of dilutive securities		762,443		4,088,586		784,877		3,936,571
Denominator for diluted earnings per share —
—Adjusted weighted average shares and assumed conversions		20,861,446		20,440,635		20,812,370		20,244,526
Basic earnings per share:	$	0.77	$	0.59	$	0.72	$	3.98
Diluted earnings per share:	$	0.74	$	0.47	$	0.69	$	3.21

In October 2009, we entered into a transaction with Merrill Lynch PCG, Inc. (the “Investor”) to exchange the existing 16.0 percent Old PIK Notes due in December 2011, for a combination of debt and equity securities (Exchange Transaction). As part of the Exchange Transaction, we issued warrants conveying the right to purchase, for $0.01 per share, 3,466,856 shares of Libbey Inc. common stock. These warrants were exercised and shares were issued in August 2010.

When applicable, diluted shares outstanding include the dilutive impact of warrants and restricted stock units. Diluted shares also include the impact of in-the-money employee stock options, which are calculated, based on the average share price for each fiscal period using the treasury stock method. Under the treasury stock method, the tax-effected proceeds that hypothetically would be received from the exercise of all in-the-money options are assumed to be used to repurchase shares.