XML 56 R14.htm IDEA: XBRL DOCUMENT v2.4.0.6
Segment Information
9 Months Ended
Sep. 30, 2012
Segment Information  
Segment Information

8. Segment Information

 

The Company has four reportable segments based on its four geographic locations: (1) Europe; (2) North America; (3) South America; (4) Asia Pacific.  These four segments are aligned with the Company’s internal approach to managing, reporting, and evaluating performance of its global glass operations.  Certain assets and activities not directly related to one of the regions or to glass manufacturing are reported with Retained corporate costs and other.  These include licensing, equipment manufacturing, global engineering, and non-glass equity investments.  Retained corporate costs and other also includes certain headquarters administrative and facilities costs and certain incentive compensation and other benefit plan costs that are global in nature and are not allocable to the reportable segments.

 

The Company’s measure of profit for its reportable segments is segment operating profit, which consists of consolidated earnings from continuing operations before interest income, interest expense, and provision for income taxes and excludes amounts related to certain items that management considers not representative of ongoing operations as well as certain retained corporate costs.  The Company’s management uses segment operating profit, in combination with net sales and selected cash flow information, to evaluate performance and to allocate resources.  segment operating profit for reportable segments includes an allocation of some corporate expenses based on both a percentage of sales and direct billings based on the costs of specific services provided.

 

In prior periods, pension expense was recorded in each segment related to the pension plans in place in that segment, with the exception of the U.S. pension plans which were recorded in Retained corporate costs and other.  Effective January 1, 2012, the Company changed the allocation of pension expense to its reportable segments such that pension expense recorded in each segment relates only to the service cost component of the plans in that segment.  The other components of pension expense, including interest cost, expected asset returns and amortization of actuarial losses, are recorded in Retained corporate costs and other.  This change in allocation has been applied retrospectively to all periods.  Also effective January 1, 2012, the Company elected to change the method of valuing U.S. inventories (see Note 1 for additional information).

 

There is no impact of the change in accounting method for inventory on segment operating profit for the three months ended September 30, 2011. The impact of the change in pension expense allocation for the three months ended September 30, 2011 is as follows:

 

 

 

As

 

Change in

 

 

 

 

 

Originally

 

Pension

 

As

 

 

 

Reported

 

Allocation

 

Adjusted

 

Segment operating profit:

 

 

 

 

 

 

 

Europe

 

$

106

 

$

5

 

$

111

 

North America

 

73

 

(6

)

67

 

South America

 

67

 

 

 

67

 

Asia Pacific

 

23

 

 

 

23

 

Reportable segment totals

 

269

 

(1

)

268

 

Retained corporate costs and other

 

(24

)

1

 

(23

)

 

The impact of the changes in pension expense allocation and accounting method for inventory on segment operating profit for the nine months ended September 30, 2011 is as follows:

 

 

 

As
Originally
Reported

 

Change in
Pension
Allocation

 

Change in
Accounting
Method for
Inventory

 

As
Adjusted

 

Segment operating profit:

 

 

 

 

 

 

 

 

 

Europe

 

$

284

 

$

15

 

$

 

$

299

 

North America

 

188

 

(18

)

10

 

180

 

South America

 

165

 

 

 

 

 

165

 

Asia Pacific

 

56

 

 

 

 

 

56

 

Reportable segment totals

 

693

 

(3

)

10

 

700

 

Retained corporate costs and other

 

(51

)

3

 

 

 

(48

)

 

Financial information for the three months ended September 30, 2012 and 2011 regarding the Company’s reportable segments is as follows:

 

 

 

2012

 

2011

 

Net sales:

 

 

 

 

 

Europe

 

$

652

 

$

770

 

North America

 

513

 

497

 

South America

 

323

 

310

 

Asia Pacific

 

254

 

270

 

Reportable segment totals

 

1,742

 

1,847

 

Other

 

5

 

15

 

Net sales

 

$

1,747

 

$

1,862

 

 

 

 

2012

 

2011

 

Segment operating profit:

 

 

 

 

 

Europe

 

$

74

 

$

111

 

North America

 

75

 

67

 

South America

 

69

 

67

 

Asia Pacific

 

27

 

23

 

Reportable segment totals

 

245

 

268

 

 

 

 

 

 

 

Items excluded from segment operating profit:

 

 

 

 

 

Retained corporate costs and other

 

(26

)

(23

)

Restructuring and asset impairment

 

(33

)

(29

)

Interest income

 

2

 

2

 

Interest expense

 

(61

)

(70

)

Earnings from continuing operations before income taxes

 

$

127

 

$

148

 

 

Financial information for the nine months ended September 30, 2012 and 2011 regarding the Company’s reportable segments is as follows:

 

 

 

2012

 

2011

 

Net sales:

 

 

 

 

 

Europe

 

$

2,088

 

$

2,355

 

North America

 

1,511

 

1,466

 

South America

 

882

 

881

 

Asia Pacific

 

741

 

778

 

 

 

 

 

 

 

Reportable segment totals

 

5,222

 

5,480

 

Other

 

30

 

60

 

Net sales

 

$

5,252

 

$

5,540

 

 

 

 

2012

 

2011

 

Segment operating profit:

 

 

 

 

 

Europe

 

$

289

 

$

299

 

North America

 

249

 

180

 

South America

 

154

 

165

 

Asia Pacific

 

79

 

56

 

Reportable segment totals

 

771

 

700

 

 

 

 

 

 

 

Items excluded from segment operating profit:

 

 

 

 

 

Retained corporate costs and other

 

(82

)

(48

)

Restructuring and asset impairment

 

(33

)

(41

)

Interest income

 

7

 

8

 

Interest expense

 

(187

)

(246

)

Earnings from continuing operations before income taxes

 

$

476

 

$

373

 

 

Financial information regarding the Company’s total assets is as follows:

 

 

 

September 30,

 

December 31,

 

September 30,

 

 

 

2012

 

2011

 

2011

 

Total assets:

 

 

 

 

 

 

 

Europe

 

$

3,510

 

$

3,588

 

$

3,693

 

North America

 

2,058

 

2,020

 

2,002

 

South America

 

1,658

 

1,682

 

1,649

 

Asia Pacific

 

1,371

 

1,379

 

1,974

 

 

 

 

 

 

 

 

 

Reportable segment totals

 

8,597

 

8,669

 

9,318

 

Other

 

274

 

306

 

283

 

Consolidated totals

 

$

8,871

 

$

8,975

 

$

9,601