8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): September 30, 2016 (September 30, 2016)

ARMSTRONG WORLD INDUSTRIES, INC.

(Exact name of registrant as specified in its charter)

Pennsylvania	1-2116	23-0366390
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(IRS Employer Identification No.)

2500 Columbia Avenue P.O. Box 3001 Lancaster, Pennsylvania	17603
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (717) 397-0611

	NA
(Former name or former address if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

□ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

□  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

□  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

□Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

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Item 7.01Regulation FD Disclosure. 

As previously announced, on April 1, 2016, Armstrong World Industries, Inc. (“AWI” or the “Company”) completed the previously announced separation of its Resilient Flooring and Wood Flooring segments into a separate and independent public company, Armstrong Flooring, Inc. (“AFI”), through the distribution of all of the then outstanding common stock of AFI to AWI’s shareholders (the “Separation”).  

As a result of the Separation, AWI does not beneficially own any shares of AFI common stock and no longer consolidates AFI’s financial results for the purpose of its own financial reporting.  Beginning in the second quarter of 2016, AFI’s historical financial results for periods prior to April 1, 2016 have been reflected in AWI’s Consolidated Financial Statements as a discontinued operation.

Effective April 1, 2016, AWI disaggregated its former Building Products operating segment into three distinct geographical segments:  Americas; Europe, Middle East and Africa (“EMEA”); and Pacific Rim. In addition, effective January 1, 2016, in anticipation of the Separation, the majority of AWI’s historical corporate support functions were incorporated into the Company’s Americas segment.  

AWI is filing this Current Report on Form 8-K to furnish certain unaudited summary consolidated and segment information for the year ended December 31, 2015 and for each of the quarters for the year ended December 31, 2015 to reflect the impact of the Separation and the change in the Company’s reporting segments.

The unaudited consolidated summary financial information has been presented for illustrative and informational purposes only and is not intended to reflect or be indicative of AWI’s consolidated results of operations or financial position had the Separation occurred as of the dates presented, and should not be taken as representation of AWI’s future consolidated results of operations or financial condition.  AWI believes that the unaudited consolidated summary financial information presented is consistent with the guidance for discontinued operations under U.S. generally accepted accounting principles.  

The following unaudited summary financial information should be read in conjunction with the historical consolidated financial statements of AWI, the accompanying notes to those financial statements and “Management's Discussion and Analysis of Financial Condition and Results of Operations” in AWI’s Annual Report on Form 10-K for the year ended December 31, 2015.

This information furnished pursuant to Item 7.01, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities and Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities under that Section and shall not be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933 or the Exchange Act.

Item 9.01Financial Statements and Exhibits.

Exhibit No.	Description
99.1	Unaudited consolidated summary financial information and reclassified summary segment information for Armstrong World Industries, Inc. on a continuing operations basis for the fiscal year ended December 31, 2015, and each of the quarters for the year ended December 31, 2015.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

ARMSTRONG WORLD INDUSTRIES, INC.
By:	/s/ Mark A. Hershey
	Mark A. Hershey
	Senior Vice President, General Counsel and Secretary

Date: September 30, 2016

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EXHIBIT INDEX

Exhibit No.	Description
99.1	Unaudited consolidated summary financial information and reclassified summary segment information for Armstrong World Industries, Inc. on a continuing operations basis for the fiscal year ended December 31, 2015, and each of the quarters for the year ended December 31, 2015.

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EX-99.1

Exhibit 99.1

Separation of Armstrong Flooring, Inc.

On April 1, 2016, Armstrong World Industries, Inc. (“AWI” or the “Company”) completed the previously announced separation (the “Separation”) of its Resilient Flooring and Wood Flooring segments into a separate and independent public company, Armstrong Flooring, Inc. (“AFI”).  Beginning in the second quarter of 2016, AFI’s historical financial results for periods prior to April 1, 2016 were reflected in the Company’s Condensed Consolidated Financial Statements as a discontinued operation.  

The following consolidated summary financial information for the year ended December 31, 2015 presents unaudited results of AWI. Such unaudited summary financial information was derived from the historical consolidated financial statements of AWI, which were prepared in accordance with U.S. generally accepted accounting principles (“GAAP”).

	Year Ended December 31, 2015
(amounts in millions)	Historical AWI (as reported)			Discontinued Operation - AFI (a)		AWI Continuing Operations
Net sales	$	2,420.0		$	1,188.7	$	1,231.3
Cost of goods sold		1,817.2			962.3		854.9
Gross profit		602.8			226.4		376.4
Selling, general and administrative expenses		447.2			179.5		267.7
Separation costs		34.3			-		34.3
Equity earnings from joint venture		(66.1	)		-		(66.1	)
Operating income	$	187.4		$	46.9	$	140.5

(a) Reflects the operations of AFI.  Cost of goods sold and selling, general and administrative expenses for AFI include certain historical costs of employee benefits that were previously categorized as unallocated corporate costs.  Expense categories exclude certain general corporate overhead expenses that were allocated to AFI in its historical financial statements that do not meet the requirements to be presented in discontinued operations and are presented as part of AWI’s continuing operations.  

The following table presents consolidated summary financial information for AWI on a continuing operations basis for each quarterly period-end and for the year ended December 31, 2015:

	CONSOLIDATED RESULTS FROM CONTINUING OPERATIONS
(amounts in millions)	Three Months Ended March 31, 2015			Three Months Ended June 30, 2015			Three Months Ended September 30, 2015			Three Months Ended December 31, 2015			Year Ended December 31, 2015
Net sales	$	292.0		$	306.1		$	335.9		$	297.3		$	1,231.3
Cost of goods sold		202.9			214.6			224.8			212.6			854.9
Gross profit		89.1			91.5			111.1			84.7			376.4
Selling, general and administrative    expenses		64.3			61.6			64.0			77.8			267.7
Separation costs		4.3			5.1			7.4			17.5			34.3
Equity earnings from joint venture		(13.6	)		(16.4	)		(19.6	)		(16.5	)		(66.1	)
Operating income	$	34.1		$	41.2		$	59.3		$	5.9		$	140.5

Reporting Segments

Effective April 1, 2016, AWI disaggregated its former Building Products operating segment into three distinct geographical segments:  Americas; Europe, Middle East and Africa (“EMEA”); and Pacific Rim. In

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addition, effective January 1, 2016, in anticipation of the Separation, the majority of AWI’s historical corporate support functions were incorporated into the Company’s Americas segment.  

The unaudited reclassified summary segment financial information presented below is provided to reflect the disaggregation of the Company’s former Building Products segment and to present the impact of the incorporation of historical corporate support functions into the Company’s Americas segment for each quarterly period-end and for the year ended December 31, 2015.

(amounts in millions)	Three Months Ended March 31, 2015			Three Months Ended June 30, 2015			Three Months Ended September 30, 2015			Three Months Ended December 31, 2015			Year Ended December 31, 2015
Net sales to external customers
Americas	$	191.3		$	202.7		$	221.5		$	189.6		$	805.1
EMEA		70.5			68.6			78.2			72.6			289.9
Pacific Rim		30.2			34.8			36.2			35.1			136.3
Total net sales to external customers	$	292.0		$	306.1		$	335.9		$	297.3		$	1,231.3
(amounts in millions)	Three Months Ended March 31, 2015			Three Months Ended June 30, 2015			Three Months Ended September 30, 2015			Three Months Ended December 31, 2015			Year Ended December 31, 2015
Segment operating income (loss)
Americas	$	64.4		$	71.9		$	88.7		$	58.5		$	283.5
EMEA		(2.1	)		(6.2	)		1.3			(4.9	)		(11.9	)
Pacific Rim		(2.5	)		(1.5	)		(0.2	)		(2.6	)		(6.8	)
Unallocated Corporate		(25.7	)		(23.0	)		(30.5	)		(45.1	)		(124.3	)
Total consolidated operating income	$	34.1		$	41.2		$	59.3		$	5.9		$	140.5

Supplemental Reconciliations of GAAP to non-GAAP Results (unaudited)

To supplement its consolidated financial statements presented in accordance with GAAP, the Company provides additional measures of performance adjusted to exclude the impact of foreign exchange, restructuring charges and related costs, impairments, the non-cash impact of the U.S. pension plan, separation costs and certain other gains and losses. Adjusted figures are reported in comparable dollars using the budgeted exchange rate for 2015. The Company uses these adjusted performance measures in managing the business, including communications with its Board of Directors and employees, and believes that they provide users of this financial information with meaningful comparisons of operating performance between current results and results in prior periods. The Company believes that these non-GAAP financial measures are appropriate to enhance understanding of its past performance, as well as prospects for its future performance.  These non-GAAP measures should not be considered in isolation or as a substitute for the most comparable GAAP measures. Non-GAAP financial measures utilized by the Company may not be comparable to non-GAAP financial measures used by other companies.

Certain line items for the first two quarters of 2015 presented within the tables below have been restated from amounts reported in an exhibit to the Company’s Current Report on Form 8-K dated July 29, 2016 as follows: (i) comparability adjustments to Comparable Base EBITDA resulting in the removal of $5M of unallocated Comparable Base EBITDA losses (for the Company’s unallocated corporate segment), and (ii) corrections to the Corporate Cost allocations to each geographical segments resulting in a net increase to consolidated Comparable Base EBITDA by $1 million.

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	CONSOLIDATED RESULTS FROM CONTINUING OPERATIONS
(amounts in millions)	Three Months Ended March 31, 2015			Three Months Ended June 30, 2015			Three Months Ended September 30, 2015			Three Months Ended December 31, 2015			Year Ended December 31, 2015
Comparable Base EBITDA	$	64		$	71		$	97		$	64		$	296
Corporate cost adjustments (a)		4			2			5			9			20
Adjusted EBITDA	$	60		$	69		$	92		$	55		$	276
D&A (b)		(19	)		(19	)		(21	)		(19	)		(78	)
Operating Income, Adjusted	$	41		$	50		$	71		$	36		$	198
Non-cash impact of U.S. pension		3			4			4			4			15
Separation expenses		4			5			8			17			34
Cost reduction initiatives		-			-			-			7			7
Foreign exchange impact		-			-			(1	)		2			1
Operating Income, As Reported	$	34		$	41		$	60		$	6		$	141

	AMERICAS
(amounts in millions)	Three Months Ended March 31, 2015			Three Months Ended June 30, 2015			Three Months Ended September 30, 2015			Three Months Ended December 31, 2015			Year Ended December 31, 2015
Comparable Base EBITDA	$	62		$	72		$	87		$	58		$	279
Corporate cost adjustments (a)		(15	)		(14	)		(16	)		(16	)		(61	)
Adjusted EBITDA	$	77		$	86		$	103		$	74		$	340
D&A (b)		(10	)		(11	)		(11	)		(11	)		(43	)
Operating Income, Adjusted	$	67		$	75		$	92		$	63		$	297
Non-cash impact of U.S. pension		3			4			4			4			15
Foreign exchange impact		-			(1	)		(1	)		-			(2	)
Operating Income, As Reported	$	64		$	72		$	89		$	59		$	284

	EMEA
(amounts in millions)	Three Months Ended March 31, 2015			Three Months Ended June 30, 2015			Three Months Ended September 30, 2015			Three Months Ended December 31, 2015			Year Ended December 31, 2015
Comparable Base EBITDA	$	3		$	(1	)	$	8		$	2		$	12
Corporate cost adjustments (a)		1			1			2			1			5
Adjusted EBITDA	$	2		$	(2	)	$	6		$	1		$	7
D&A (b)		(4	)		(3	)		(4	)		(4	)		(15	)
Operating Income (Loss), Adjusted	$	(2	)	$	(5	)	$	2		$	(3	)	$	(8	)
Cost reduction initiatives		-			-			-			2			2
Foreign exchange impact		-			1			1			-			2
Operating Income (Loss), As    Reported	$	(2	)	$	(6	)	$	1		$	(5	)	$	(12	)

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	PACIFIC RIM
(amounts in millions)	Three Months Ended March 31, 2015			Three Months Ended June 30, 2015			Three Months Ended September 30, 2015			Three Months Ended December 31, 2015			Year Ended December 31, 2015
Comparable Base EBITDA	$	(1	)	$	-		$	2		$	4		$	5
Corporate cost adjustments (a)		-			-			1			(2	)		(1	)
Adjusted EBITDA	$	(1	)	$	-		$	1		$	6		$	6
D&A (b)		(3	)		(2	)		(2	)		(2	)		(9	)
Operating Income (Loss), Adjusted	$	(4	)	$	(2	)	$	(1	)	$	4		$	(3	)
Cost reduction initiatives		-			-			-			5			5
Foreign exchange impact		(2	)		-			(1	)		2			(1	)
Operating (Loss), As Reported	$	(2	)	$	(2	)	$	-		$	(3	)	$	(7	)

	UNALLOCATED CORPORATE
(amounts in millions)	Three Months Ended March 31, 2015			Three Months Ended June 30, 2015			Three Months Ended September 30, 2015			Three Months Ended December 31, 2015			Year Ended December 31, 2015
Comparable Base EBITDA	$	-		$	-		$	-		$	-		$	-
Corporate cost adjustments (a)		18			15			18			26			77
Adjusted EBITDA	$	(18	)	$	(15	)	$	(18	)	$	(26	)	$	(77	)
D&A (b)		(2	)		(3	)		(4	)		(2	)		(11	)
Operating (Loss), Adjusted	$	(20	)	$	(18	)	$	(22	)	$	(28	)	$	(88	)
Separation expenses		4			5			8			17			34
Foreign exchange impact		2			-			-			-			2
Operating (Loss), As Reported	$	(26	)	$	(23	)	$	(30	)	$	(45	)	$	(124	)

(a) Includes adjustments to Corporate costs and geographic allocations of Corporate support functions due to the Separation to assist in comparison to 2016 AWI results.  The adjustments include changes in geographic allocations and removal of certain costs not applicable to the current AWI structure.

(b) Excludes accelerated depreciation associated with cost reduction initiatives reflected below.  Actual D&A as reported was: $19.0 million for the three months ended March 31, 2015; $19.3 million for the three months ended June 30, 2015; $19.7 million for the three months ended September 30, 2015; $21.2 million for the three months ended December 31, 2015; and $79.2 million for the year ended December 31, 2015.

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