10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10‑K

☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2014

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                 to               

Commission file number 1‑10638

CAMBREX CORPORATION

(Exact name of registrant as specified in its Charter)

Delaware	22‑2476135
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

One Meadowlands Plaza,
East Rutherford, New Jersey	07073
(Address of principal executive offices)	(Zip Code)

Registrant's telephone number, including area code:  (201) 804‑3000

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Name of each exchange on which registered
Common Stock, $.10 par value	New York Stock Exchange

Securities registered pursuant to Section 12 (g) of the Act:  (None)

Indicate by check mark whether the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☒.   No ☐.

Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.  Yes ☐. No ☒.

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.   Yes ☒.   No ☐.

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes ☒.   No ☐.

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  ☒

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company.  See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.  (Check one):

Large accelerated filer ☐ Accelerated filer ☒ Non-accelerated filer ☐   Smaller reporting company ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Act).  Yes ☐.   No ☒.

The aggregate market value of the voting and non-voting common equity held by non‑affiliates of the registrant was approximately $620,956,613 as of June 30, 2014.

As of January 30, 2015, there were 31,098,306 shares outstanding of the registrant's Common Stock, $.10 par value.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Registrant’s definitive Proxy Statement for the 2015 Annual Meeting are incorporated by reference into Part III of this Report.

CAMBREX CORPORATION AND SUBSIDIARIES

INDEX TO ANNUAL REPORT ON FORM 10-K

For the Year Ended December 31, 2014

Item No.	PART I	Page No.
1	Business	3
1A	Risk Factors	8
1B	Unresolved Staff Comments	18
2	Properties	18
3	Legal Proceedings	19
4	Mine Safety Disclosures	19
	PART II
5	Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	19
6	Selected Financial Data	22
7	Management’s Discussion and Analysis of Financial Condition and Results of Operations	23
7A	Quantitative and Qualitative Disclosures about Market Risk	36
8	Financial Statements and Supplementary Data	36
9	Changes in and Disagreements With Accountants on Accounting and Financial Disclosure	77
9A	Controls and Procedures	77
9B	Other Information	78
	PART III
10	Directors, Executive Officers and Corporate Governance	79
11	Executive Compensation	80
12	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	80
13	Certain Relationships and Related Transactions, and Director Independence	80
14	Principal Accountant Fees and Services	80
	PART IV
15	Exhibits and Financial Statement Schedules	81

2

Forward-Looking Statements

This document contains and incorporates by reference forward-looking statements including statements regarding expected performance, including, but not limited to, the Company’s belief that cash flows from operations, along with funds available from the revolving line of credit, will be adequate to meet the operational and debt servicing needs of the Company, as well as other statements relating to expectations with respect to sales, the timing of orders, research and development expenditures, earnings per share, capital expenditures, the outcome of pending litigation (including environmental proceedings and remediation investigations) and related estimates of potential liability, acquisitions, divestitures, collaborations or other expansion opportunities.  These statements may be identified by the fact that they use words such as “may,” “will,” “could,” “should,” “would,” “expect,” “anticipate,” “intend,” “estimate,” “believe” or similar expressions.  Any forward-looking statements contained herein are based on current plans and expectations and involve risks and uncertainties that could cause actual outcomes and results to differ materially from current expectations.  The factors described in Item 1A of Part I of this Annual Report on Form 10-K, captioned “Risk Factors,” or otherwise described in the Company’s filings with the Securities and Exchange Commission, provide examples of such risks and uncertainties that may cause the Company’s actual results to differ materially from the expectations the Company describes in its forward-looking statements, including, but not limited to, pharmaceutical outsourcing trends, competitive pricing or product developments, government legislation and regulations (particularly environmental issues), tax rates, interest rates, technology, manufacturing and legal issues, including the outcome of outstanding litigation, changes in foreign exchange rates, uncollectible receivables, the timing of orders, loss on disposition of assets, cancellation or delays in renewal of contracts, lack of suitable raw materials or packaging materials, the Company’s ability to receive regulatory approvals for its products and continued demand in the U.S. for late stage clinical products or the successful outcome of the Company’s investment in new products.

The forward-looking statements are based on the beliefs and assumptions of Company management and the information available to Company management as of the date of this report.  The Company cautions investors not to place significant reliance on expectations regarding future results, levels of activity, performance, achievements or other forward-looking statements.  The information contained in this Annual Report on Form 10-K is provided by the Company as of the date hereof, and, unless required by law, the Company does not undertake and specifically disclaims any obligation to update these forward-looking statements contained in this Annual Report on Form 10-K as a result of new information, future events or otherwise.

PART I

Item 1 Business.

General

Cambrex Corporation (the "Company" or "Cambrex"), a Delaware corporation, began business in December 1981.  Cambrex is a life sciences company that provides products and services that accelerate and improve the development and commercialization of new and generic therapeutics.  The Company primarily supplies its products and services worldwide to innovator and generic pharmaceutical companies.  The Company's overall strategy is to: grow its portfolio of custom development projects, especially those in the later stages of the clinical trial process; secure long-term supply agreements to produce active pharmaceutical ingredients (“APIs”) and intermediates for newly approved drug products; expand sales of products and projects based on its proprietary technologies; and partner with generic drug companies to grow the Company’s extensive portfolio of generic APIs.  The Company’s acquisition of Zenara Pharma Private Limited (“Zenara”) also gives the Company the additional capability of producing final dosage form products.  The Company also seeks to demonstrate excellence in regulatory compliance, environmental, health and safety, and customer service.  Cambrex has three operating segments, which are manufacturing facilities that have been aggregated as one reportable segment.  Zenara, the fourth facility, is not material.

(dollars in thousands, except per share data)

3

The Company uses a consistent business approach:

· Niche Market Focus:  The Company participates in niche markets where significant technical expertise provides a competitive advantage and market differentiation.

· Market Leadership:  The Company secures leading market positions through excellent customer service, proprietary technologies, specialized capabilities and an outstanding regulatory record and leverages these capabilities across the market segments in which it participates.

· New Products and Services:  The Company continues to invest in research and development (“R&D”) in order to introduce innovative products and services to accelerate revenue growth, provide a competitive advantage and maintain its leading market positions.

· Operational Excellence:  The Company maintains its commitment to continually improve productivity and customer service levels and maintains excellent quality and regulatory compliance systems.

· Acquisition and Licensing:  The Company may drive growth in strategic business segments through the prudent acquisition of businesses, products, product lines, technologies and capabilities to enhance the Company's position in its niche markets.

Market Overview and Growth Drivers

The Company participates in markets that serve the healthcare industry.  Customers include generic drug companies and companies that discover and commercialize small molecule human therapeutics using organic chemistry.

The aging western population, continued investment in healthcare research and drug development, growth in the world’s developing markets, and the necessity to develop therapeutics to address unmet needs drives business growth in life sciences companies.  Aging "baby boomers" in the United States, Europe and Japan may provide an enormous healthcare opportunity.  This group typically has more education, a higher socio-economic level and higher demands for healthcare services than previous generations.

Demand for Cambrex products and services is dependent upon some of its customers’ continuing access to financial resources to advance their R&D projects for therapeutic candidates from the laboratory to the clinic, and eventually, to the patient.  Healthcare investment comes from a variety of sources.  Large pharmaceutical and biotechnology companies spend billions on drug discovery and development and the Company believes billions more are spent by numerous smaller emerging pharmaceutical companies.  Macro-economic conditions can have an impact on the availability of funding for the Company’s customers, especially many of the smaller companies that are often dependent upon venture capital and other private sources of funding.

Cambrex assists companies in developing robust processes for the manufacture of clinical and commercial quantities. Product testing, analytical methods and quality processes are integrated into the manufacturing process.  Cambrex excels in the manufacture and testing of APIs and drug substances at laboratory, clinical and commercial scale and specializes in optimizing manufacturing processes.

Demand for outsourced services from pharmaceutical companies continues to grow.  Large pharmaceutical and biotechnology companies may outsource the development and manufacturing of a drug substance to manage multiple internal priorities, access new technologies or additional capacity, preserve needed capital or ensure multiple sources of supply.  Many emerging pharmaceutical and generic drug companies outsource all process development and manufacturing, and many larger pharmaceutical companies have outsourced the manufacturing of drug products.  With large plants and product development resources in both Europe and the U.S., and large teams of professionals with substantial experience in the development, scale-up and operation of pharmaceutical manufacturing processes, Cambrex is particularly well positioned to assist drug companies with these much needed services for APIs.

(dollars in thousands, except per share data)

4

New drugs are typically patented.  When the patent expires, the drug may be manufactured and marketed in its generic form.  Growth in the generic drug market is driven by the continuing stream of drug patents that will expire in the future and favorable market forces that encourage the use of generic pharmaceuticals as a more cost effective alternative to higher-priced branded drugs.  In the United States, and many countries in Europe, governments and prescription benefit management companies provide incentives for generic substitution to reduce costs.  Cambrex manufactures over 80 generic APIs, typically in relatively small quantities for use in niche therapeutics.

The market for human therapeutics is regulated by the Food and Drug Administration (“FDA”) in the United States and other similar regulatory agencies throughout the world.  These agencies oversee and regulate the development, manufacturing and commercialization processes for APIs and regulated intermediates.  Excellent regulatory and quality systems as well as extensive experience in pharmaceutical fine chemical scale-up and manufacturing are essential to serve the industry and serve as a barrier to entry for potential new competitors.

Competitors from developing markets have increased their capabilities in drug substance manufacturing and finished dosage form drugs in recent years.  While overall global demand has been lifted by the rapid growth in certain developing markets, the presence of competitors within these markets, who have lower cost structures, have resulted in downward pricing pressure throughout the pharmaceutical supply chain, and especially on generic APIs and certain development services for clinical phase products.  Pricing pressures, due to developing market competitors, on later stage clinical projects and supply arrangements for patented products has been limited to date, although these pressures may increase as developing markets become more acceptable as suppliers to larger pharmaceutical companies.  Cambrex regularly sources R&D services, raw materials and certain intermediates from developing market companies.

Development of the Business

The discussion below provides insight into the general development of the Company’s business, including recent acquisitions.

In November 2010, the Company acquired a 51% equity stake in Zenara, a Hyderabad, India based pharmaceutical company focused on the formulation of final dosage form products.  In May 2014, the Company purchased the remaining 49% interest in Zenara.  The Company negotiated an accelerated purchase of the business, which was contractually required to be completed in 2016 at a price that would have been determined by the financial performance of the Zenara business.  The purchase price negotiated for the 49% was $2,680.  Management believed it was economically beneficial to take control of the business to accelerate the execution of the Company’s strategy for the business.  Previously, Cambrex accounted for its investment in Zenara using the equity method of accounting.  Zenara’s results from the purchase date through December 31, 2014 are reflected in the consolidated financial statements of the Company and were not material.  See Notes 2, 4 and 8 to the Company’s consolidated financial statements for additional information.

Products

The Company uses its technical expertise in a wide range of chemical processes to meet the needs of its customers for high quality products and services for specialized applications.

The Company’s business is primarily comprised of the custom development and manufacture of pharmaceutical ingredients derived from organic chemistry.  Products and services are supplied globally to innovator and generic drug companies.  Products include APIs, pharmaceutical intermediates and, to a lesser extent, other fine chemicals.  The Company’s acquisition of Zenara also gives the Company the additional capability of producing final dosage form products.

(dollars in thousands, except per share data)

5

The Company’s products and services are sold to a diverse group of several hundred customers, with one customer, Gilead Sciences, Inc., accounting for 24.0% of 2014 consolidated sales and 18.3% of 2013 consolidated sales.  The Company’s products are sold through a combination of direct sales and independent agents.  One API, an antiviral product, represented 22.9% of 2014 consolidated sales.  In 2013, two APIs, one an antiviral, and the other a gastrointestinal product that is sold to multiple customers, represented 18.3% and 10.0%, respectively, of consolidated sales.

The following table shows gross sales by geographic area:

	2014		2013		2012
Europe	$	232,894	$	210,463	$	150,678
North America		117,477		86,974		105,439
Asia		12,865		13,800		12,827
Other		10,914		5,975		8,987
Total	$	374,150	$	317,212	$	277,931

Marketing and Distribution

Marketing generally requires significant cooperative effort among a highly trained sales and marketing staff, a scientific staff that can assess the technical fit and estimate manufacturing economics, manufacturing and engineering staff to scale up the chemical process and business unit management to determine the strategic and operational fit.  The process to take a client's project from the clinical trial stage to a commercial, approved therapeutic may take from two to ten years.  The Company uses sales agents and independent distributors in those areas where they are deemed to be more effective or economical than direct sales efforts.

Raw Materials

The Company uses a wide array of raw materials in its businesses.  For its products, the Company generally will attempt to have a primary and secondary supplier for its critical raw materials.  Prices for these raw materials are generally stable, except for the petroleum-based solvents and certain other commodity materials, where prices can vary with market conditions.

Research and Development

The Company's R&D program is designed to increase the Company's competitiveness by improving its technology and developing processes for the manufacture of new products to meet customer requirements.  The goals are to introduce innovative and proprietary products, improve manufacturing processes to reduce costs, improve quality and increase capacity to identify market opportunities that warrant significant technical expertise, and offer the prospects of a long-term, profitable business relationship.  R&D activities are performed at all of the Company's manufacturing facilities in the United States, Europe and India.  Approximately 160 employees are at least partially involved in R&D activities worldwide.

The Company spent $13,075, $10,387 and $9,544 in 2014, 2013 and 2012, respectively, on R&D efforts.

Patents and Trademarks

The Company has patent protection covering certain products, processes and services.  In addition, the Company also relies on know-how and trade secrets (related to many of its manufacturing processes and techniques not generally known to other companies) for developing and maintaining its market position.  The Company currently owns 14 issued patents and has 24 patent applications pending in the United States and owns 161 patents and has 109 patent applications pending in foreign countries covering various technologies.  The Company seeks to protect its proprietary technology and prepares new patent applications as it develops new inventions.

(dollars in thousands, except per share data)

6

The patent rights the Company considers most significant to its business are U.S. Patent Nos. 6,828,336 and 6,586,449 and 26 foreign counterparts which relate to its nicotine polacrilex resin products and methods of manufacturing, and expire on May 28, 2022.

The Company's products and services are sold around the world under trademarks that are owned by the Company.  This includes Profarmaco, which is registered around the world as a word and design mark.  Rights in this trademark will exist at least as long as the Company or its majority owned subsidiaries continue to use the trademark.

The Company has entered into a worldwide perpetual license agreement with Celgene Corporation and Celgro Corporation that gives the Company the exclusive rights to certain intellectual property, including know-how and technology, relating to the development and manufacture of chirally pure bulk APIs.  This intellectual property is related to amphetamine salts currently sold by the Company.  Under the terms of this agreement, the Company pays no royalties or fees related to its use of this intellectual property.

Competition

The Company has numerous primary API and advanced intermediate competitors throughout Western Europe and the United States and many more competitors within various product categories the Company serves, including a growing number of competitors in Asia, Eastern Europe and other low-cost areas.  The Company believes that low cost providers have had the impact of driving prices down for many products and services for which the Company competes to provide, especially within the generic API market, and the Company anticipates that it will face increased competition from these providers in the future.  It is expected that regulatory compliance, product quality, pricing, and logistics will determine the extent of the long term impact of these competitors in the primary markets that the Company serves.  If the Company perceives significant competitive risk and a need for technical or financial commitment, it generally attempts to negotiate long term contracts or guarantees from its customers.

Environmental and Safety Regulations and Proceedings

Certain products manufactured by the Company involve the use, storage and transportation of toxic and hazardous materials.  The Company's operations are subject to extensive laws and regulations relating to the storage, handling, emission, transportation and discharge of materials into the environment and the maintenance of safe working conditions.  The Company maintains environmental and industrial safety and health compliance programs and training at its plants and believes that its manufacturing operations are in compliance with all applicable safety, health and environmental laws.

Prevailing legislation tends to hold companies primarily responsible for the proper disposal of its waste even after transfer to third party waste disposal facilities.  Other future developments, such as increasingly strict environmental, safety and health laws and regulations, and enforcement policies, could result in substantial costs and liabilities to the Company and could subject the Company's handling, manufacture, use, reuse or disposal of substances or pollutants at its plants to more rigorous scrutiny than at present.

Known environmental matters that may result in liabilities to the Company and the related estimates and accruals are summarized in Note 20 to the Company’s consolidated financial statements.

The Company’s policy is to comply with all legal requirements of applicable environmental, health and safety laws and regulations.  The Company believes it is in compliance with such requirements and has adequate professional staff and systems in place to remain in compliance.  In some cases, compliance can only be achieved by capital expenditures, and the Company made capital expenditures of $3,733, $3,554 and $3,757 in 2014, 2013 and 2012, respectively, for environmental projects.  As the environmental proceedings in which the Company is involved progress from the remedial investigation and feasibility study stage to implementation of remedial measures, related capital and other expenditures may increase.  The Company considers costs for environmental compliance to be a normal cost of doing business and includes such costs in pricing decisions.

(dollars in thousands, except per share data)

7

Employees

At December 31, 2014, the Company had 1,117 employees worldwide (803 of whom were from international operations) compared with 936 employees at December 31, 2013 and 891 at December 31, 2012.

Non-U.S. production, administration, scientific and technical employees are represented by various local and national unions.  The Company believes its labor relations are satisfactory.

Seasonality

The Company experiences some seasonality primarily due to planned plant shutdowns by the Company and certain customers in the third quarter.  Operating results for any quarter, however, are not necessarily indicative of results for any future period.  In particular, as a result of various factors including, but not limited to, acquisitions, plant shutdowns, and the timing of large contract revenue streams, the Company believes that period-to-period comparisons of its operating results should not be relied upon as an indication of futureperformance.

Export and International Sales

Export sales from the Company’s domestic operations in 2014, 2013 and 2012 amounted to $101,101, $86,850 and $32,872, respectively.  Sales from international operations were $187,415, $164,010, and $168,202 in 2014, 2013 and 2012, respectively.  Refer to Note 18 to the Company’s consolidated financial statements.

Additional Information

Cambrex Corporation was incorporated as a Delaware corporation in 1981.  The Company’s principal office is located at One Meadowlands Plaza, East Rutherford, NJ 07073 and its telephone number is (201) 804-3000.

This Annual Report on Form 10-K, the Company’s Quarterly Reports on Form 10-Q, the Company’s Current Reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act are made available free of charge on the Company’s website www.cambrex.com  as soon as reasonably practicable after such material is electronically filed with, or furnished to, the SEC.  The most recent certifications by the Company’s Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 are filed as exhibits to this Annual Report on Form 10-K.  The Company also files with the New York Stock Exchange (“NYSE”) the Annual Chief Executive Officer Certification as required by Section 303A.12.(a) of the NYSE Listed Company Manual.

The following corporate governance documents are available free of charge on the Company’s website:  the charters of its Audit, Regulatory Affairs, Compensation and Governance Committees, Corporate Governance Guidelines, Code of Business Conduct and Ethics and Independence Standards for Directors.  These corporate governance documents are also available in print to any stockholder requesting a copy from the corporate secretary at the principal executive offices.  Information contained on the website is not part of this report.  The Company will also post on its website any amendments to or waivers of its Code of Business Conduct and Ethics that relate to its Chief Executive Officer, Chief Financial Officer and Principal Accounting Officer.

Item 1A Risk Factors.

Factors That May Affect Future Results

The following risk factors and other information included in this Annual Report on Form 10-K should be carefully considered, including the cautionary note under the heading “Forward-Looking Statements.”  If any of the following risks manifests, the Company’s business, financial condition, operating results, cash flows and reputation could be materially adversely affected. The risks and uncertainties described below are not the only ones the Company faces.  Additionally, risks and uncertainties not presently known to the Company or that it currently deems immaterial may also impair its business, financial condition, operating results and cash flows in the future.

(dollars in thousands, except per share data)

8

Certain of the Company’s customers and suppliers comprise a significant percentage of the Company’s business and the loss of one or more of these customers or suppliers could have a material adverse effect on the Company’s financial position, results of operations and cash flows.

Should any significant customer renegotiate on terms more favorable to them, or discontinue or decrease their usage of the Company’s products, the loss could have a material adverse effect on the Company’s financial position, results of operations and cash flow.  The Company’s customers routinely attempt to reduce costs, including the costs of the Company’s products, as a result of macro-economic trends and various market dynamics specifically affecting the pharmaceuticals industry.

New technologies, competition or a reduction in demand for the Company’s products could reduce sales.

The markets for the Company’s products are competitive and price sensitive.  The Company has numerous primary API and advanced intermediate competitors throughout Western Europe and the United States and many more competitors within various segments of the markets the Company serves, including a growing number of competitors in Asia, Eastern Europe and other low-cost areas.  The Company’s competitors may lower prices on products in the future and the Company may, in certain cases, respond by lowering its prices.   Conversely, failure to anticipate and respond to price competition may adversely impact the Company’s market share. Competitors may develop new technologies or products, negatively impacting the Company.  Several of the Company’s customers, especially those that buy its generic APIs and larger pharmaceutical companies that primarily sell patented products, have internal capabilities similar to the Company’s.  If one or more of these customers replace the Company’s products with their own internal capabilities, demand for the Company’s products may decrease.  In addition, demand for the Company’s products may weaken due to a reduction in R&D budgets, loss of distributors or other factors. A reduction in demand for the Company’s products could impair profit margins and may have a material adverse effect on the Company’s financial position, results of operations and cash flow.

The Company’s failure to obtain new contracts or renew existing contracts may adversely affect its business.

The Company must continually renew existing contracts and win new contracts, which subjects the Company to potentially significant pricing pressures. In the event the Company is unable to replace these contracts timely or at all, or is forced to accept terms, including pricing terms, less favorable to the Company, the Company’s revenue may not be able to be sustained or may decline.  In addition, certain of the Company’s long-term contracts may be cancelled or delayed by clients for any reason upon notice.  Multiple cancellations, non-renewals, or renewals on less favorable terms to the Company of significant contracts could materially impact the Company’s business.  While the Company intends to seek to renegotiate new or extended agreements prior to expiration, if these contracts cannot be renewed or extended on terms acceptable to the Company or at all, the Company’s business, results of operations and financial condition could be materially adversely affected.

Failure to obtain raw materials from third-party manufacturers could affect the Company’s ability to manufacture and deliver its products.

The Company relies on third-party manufacturers to supply many of its raw materials and intermediates.  In addition, the Company has a single source for supplies of some raw materials to its products.  Manufacturing problems may occur with these and other outside sources.  Prolonged disruptions in the supply of any of the Company’s key raw materials, difficulty implementing replacement materials or new sources of supply, or a significant increase in the prices of raw materials could have a material adverse effect on the Company’s operating results, financial condition or cash flows.  If a supplier provides the Company raw materials or other supplies that are deficient or defective or if a supplier fails to provide the Company such materials or supplies in a timely manner, the Company may have limited ability to find appropriate substitutes or otherwise meet required specifications and deadlines. Moreover, the Company could experience inventory shortages if it is required to use an alternative supplier on short notice, which also could lead to raw materials being purchased on less favorable terms than the Company has with its regular suppliers.  If such problems occur, the Company may not be able to manufacture its products profitably or on time, which could harm the Company’s reputation and have a material adverse effect on the Company’s business.

(dollars in thousands, except per share data)

9

Failure to obtain sufficient quota from the Drug Enforcement Administration ("DEA") could affect the Company’s ability to manufacture and deliver its products.

The starting materials used in several of the Company's products and many of the Company's finished products are controlled substances and are regulated by the DEA. Consequently, their manufacture, shipment (including import and export), storage, sale and use are subject to a high degree of regulation.  In particular, the DEA limits the manufacturing and distribution of the starting materials and APIs manufactured by the Company and it must regularly apply for quota to obtain and manufacture these substances.  As a result of these limitations, the Company may not be able to meet commercial demand for these substances, which could harm its relationship with customers and its reputation. If the Company’s DEA registration were revoked or suspended, or if any of the Company’s quota applications were rejected, the Company could no longer lawfully possess, manufacture or distribute controlled substances, which could have a material adverse effect on the Company’s business.

Disruptions to the Company’s or its customers’ manufacturing operations or supply chain could adversely affect its results.

Due to heavy reliance on manufacturing and related operations to produce and distribute the products the Company sells, the Company could be adversely affected by disruptions to these operations or its customers’ operations.  The Company and its suppliers and customers operate in a highly regulated industry.  Any violation of applicable regulations, failure to meet applicable manufacturing standards, or other actions by regulatory agencies, including, but not limited to, plant shutdowns or the removal of a product from the market that eliminate or reduce the Company’s and its customer’s sales of products could negatively impact the Company’s business and reputation.  In addition, a number of factors could cause production interruptions at the Company’s facilities, including equipment malfunctions, disruptions in the supply chain, facility contamination, labor problems, raw material shortages, natural disasters, disruption in utility services, fire, terrorist activities, human error or disruptions in the operations of the Company’s suppliers. Any significant disruption to those operations for these or any other reasons could adversely affect the Company’s sales and customer relationships. Any sustained reduction in the Company’s ability to provide products would negatively impact its sales growth expectations, cash flows and profitability.

Litigation may harm the Company or otherwise negatively impact its management and financial resources.

The Company’s business is subject to the risk of litigation by employees, customers, consumers, suppliers, stockholders or others through private actions, class actions, administrative proceedings, regulatory actions or other litigation.  The outcome of litigation, particularly class action lawsuits and regulatory actions, is difficult to assess or quantify.  Plaintiffs in these types of lawsuits may seek recovery of very large or indeterminate amounts, and the magnitude of the potential loss relating to such lawsuits may remain unknown for substantial periods of time.   Complex or extended litigation could cause the Company to incur large expenditures and distract its management. The cost to defend current and future litigation may be significant.  There may also be adverse publicity associated with litigation that could decrease customer acceptance of the Company’s products, regardless of whether the allegations are valid or whether the Company is ultimately found liable.  Disputes from time to time with such companies or individuals are not uncommon, and the Company cannot be assured that it will always be able to resolve such disputes on terms favorable to the Company.  As a result, litigation may adversely affect its business, financial condition and results of operations.  In addition, certain contracts with our suppliers and customers contain provisions whereby the Company indemnifies, subject to certain limitations, the counterparty for damages suffered as a result of claims related to use of the Company’s products or facilities and other matters. Claims made under these provisions could be expensive to litigate and could result in significant payments.

(dollars in thousands, except per share data)

10

Refer to Note 20 to the Company’s consolidated financial statements for a discussion of the Company’s environmental and legal matters.

Incidents related to hazardous materials could adversely affect the Company.

Portions of the Company’s operations require the controlled use of hazardous materials.  Although the Company designs and implements safety procedures to comply with the standards prescribed by federal, state, and local regulations, the risk of accidental contamination of property, or injury to individuals from these materials, cannot be completely eliminated.  In the event of accidental contamination of property or injury to individuals caused by these materials, the Company could be liable for damages which could adversely affect its business.  Additionally, any incident could shut down the Company’s operations, which could have a material adverse effect on the business and results of operations of the Company.

The Company generates waste that must be transported to approved storage, treatment and disposal facilities.  The transportation and disposal of such waste are required to meet applicable state and federal statutes and regulations.  The handling of such waste potentially exposes the Company to environmental liability if, in the future, it is determined that the violation of statutes or regulations occurred.

The Company is also a party to several environmental remediation investigations and activities and, along with other companies, has been named a potentially responsible party (“PRP”) for certain waste disposal sites. The Company’s estimated reserve for environmental remediation is based on information currently available to it and may be subject to material adjustment in future periods as new facts or circumstances may indicate.  Moreover, despite its efforts to comply with environmental laws, the Company may face significant remediation liabilities and additional legal proceedings concerning environmental matters, which could have a material adverse effect on the Company’s business.

It is the Company’s policy to record appropriate liabilities for environmental matters where remedial efforts are probable and the costs can be reasonably estimated.  Such liabilities are based on the Company’s best estimate of the undiscounted future costs required to complete the remedial work.  Environmental matters often span several years and frequently involve regulatory oversight or adjudication.  Additionally, many remediation requirements are fluid and are likely to be affected by future technological, site and regulatory developments.  Each of these matters is subject to various uncertainties, and it is possible that some of these liabilities will be materially higher than the Company has estimated.

In matters where the Company has been able to reasonably estimate its liability, the Company has accrued for the estimated costs associated with the study or remediation of applicable sites not owned by the Company and the Company's current and former operating sites.  Reserves are adjusted periodically as remediation efforts progress or as additional technical, regulatory or legal information become available.  In some jurisdictions in which the Company operates, such as Hyderabad, India, environmental, health and safety regulations are still early in their development, and the Company cannot determine how these laws will be implemented and the impact of such regulation on the Company.  Given the uncertainties regarding the status of laws, regulations, enforcement, policies, the impact of other PRPs, technology and information related to individual sites, the Company does not believe it is possible to currently develop an estimate of the range of reasonably possible environmental losses in excess of its reserves.

Refer to Note 20 to the Company’s consolidated financial statements for a discussion of the Company’s environmental and legal matters.

Potential product liability claims, errors and omissions claims in connection with services the Company performs and potential liability under indemnification agreements between the Company and its officers and directors could adversely affect the Company.

The Company manufactures products intended for use by the public.  These activities could expose the Company to risk of liability for personal injury or death to persons using such products.  The Company seeks to reduce its potential liability through measures such as contractual indemnification provisions with customers (the scope of which may vary by customer, and the performances of which are not secured) and insurance maintained by customers.  The Company could be materially and adversely affected if it were required to pay damages or incur defense costs in connection with a claim that is outside the scope of the indemnification agreements, if the indemnity, although applicable, is not performed in accordance with its terms or if the Company’s liability exceeds the amount of applicable insurance or indemnity.  In addition, the Company could be held liable for errors and omissions in connection with the services it performs.  The Company currently maintains product liability and errors and omissions insurance with respect to these risks.  There can be no assurance, however, that the Company’s insurance coverage will be adequate or that insurance coverage will continue to be available on terms acceptable to the Company.

(dollars in thousands, except per share data)

11

The Company also indemnifies its officers and directors for certain events or occurrences while the officer or director was serving at the Company’s request in such capacity.  The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited.  Although the Company has a director and officer insurance policy that covers a portion of any potential exposure, the Company could be materially adversely affected if it were required to pay damages or incur legal costs in connection with a claim above its insurance limits.

Any claims beyond the Company’s insurance coverage limits, or that are otherwise not covered by the Company’s insurance, may result in substantial costs and a reduction in its available capital resources.

The Company maintains property insurance, employer’s liability insurance, product liability insurance, general liability insurance, business interruption insurance, and directors and officers liability insurance, among others.  Although the Company maintains what it believes to be adequate insurance coverage, potential claims may exceed the amount of insurance coverage or may be excluded under the terms of the policy, which could cause an adverse effect on the Company’s business, financial condition and results from operations.  Generally, the Company would be at risk for the loss of inventory that is not within customer specifications.  These amounts could be significant.  In addition, in the future the Company may not be able to obtain adequate insurance coverage or the Company may be required to pay higher premiums and accept higher deductibles in order to secure adequate insurance coverage.

The Company depends on key personnel and the loss of key personnel could harm the Company’s business and results of operations.

The Company depends on its ability to attract and retain qualified scientific and technical employees as well as a number of key executives.  These employees may voluntarily terminate their employment with the Company at any time.  There can be no assurance the Company will be able to retain key personnel, or to attract and retain additional qualified employees.  The Company does not maintain key-man or similar policies covering any of its senior management or key personnel.  The Company’s inability to attract and retain key personnel would have a material adverse effect on the Company’s business.

The Company has made significant capital investments to its facilities to meet its potential future needs and, as a result, the Company depends on the success of attracting new and retaining existing customers’ projects and their continued business.

The Company has made substantial investments in all of its manufacturing facilities.  With the completion of these facilities, the Company’s fixed costs have increased.  If the Company is not able to utilize the facilities to capacity, its margins could be adversely affected.

The Company expanded its large-scale manufacturing capacity to support expected growth in the business.  There can be no assurance that sales volumes will be sufficient to ensure the economical operation of this expanded capacity, in which case, the Company’s results of operations could be adversely affected.

(dollars in thousands, except per share data)

12

Global growth is subject to a number of economic risks.

A reduction in the availability of debt or equity capital could adversely affect the ability of the Company’s customers to obtain financing for product development and could result in a decrease in or cancellation of orders for the Company’s products as well as impact the ability of the Company’s customers to make payments.  The Company believes that cash flows from operations, along with funds available from a revolving line of credit, will be adequate to meet the operational and debt servicing needs of the Company, but if this does not continue to be the case the Company’s business may be materially adversely affected.  There is a risk that the funds available to be drawn under the Company’s revolving line of credit may not be available in the event of the failure of one or more participant banks.  Significant movements in the rate of exchange between the U.S. dollar and certain currencies, primarily the euro and Swedish krona, may also adversely affect the Company’s results.

If the Company acquires other businesses, it may be harmed by difficulties in integration and employee retention, unidentified liabilities of the acquired businesses, or obligations incurred in connection with financing the acquisition.

All acquisitions involve known and unknown risks that could adversely affect the Company’s future revenues and operating results. For example:

· The Company may fail to successfully integrate its acquisitions in accordance with its business strategy.

· The initial rationale for the acquisition may not remain viable due to a variety of factors, including unforeseen regulatory changes and market dynamics after the acquisition, and this may result in a significant delay or reduction in the profitability of the acquisition.

· Integration of acquisitions may divert management’s attention away from the Company’s primary product offerings, resulting in the loss of key customers or personnel, and may expose the Company to unanticipated liabilities.

· The Company may not be able to retain the skilled employees and experienced management that may be necessary to operate the businesses it acquires. If the Company cannot retain such personnel, it may not be able to locate or hire new skilled employees and experienced management to replace them.

· The Company may purchase a business that has contingent liabilities that include, among others, known or unknown environmental, patent or product liability claims.

· The Company’s acquisition strategy may require it to obtain additional debt or equity financing, resulting in additional leverage, or increased debt obligations as compared to equity, and dilution of ownership.

· The Company may purchase businesses located in jurisdictions where it does not have operations and as a result it may not be able to anticipate local regulations and the impact such regulations have on its business.

Any indemnities or warranties obtained in connection with such acquisitions may not fully cover the ultimate actual liabilities the Company incurs due to limitations in scope, amount or duration, financial limitations of the indemnitor or warrantor or other reasons.

As a result of acquiring businesses or entering into other significant transactions, the Company may experience significant charges to earnings for merger and related expenses.  If the Company is not able to successfully integrate the acquired business, it may affect the Company’s results of operations and the market price of its common stock.  Furthermore, if the Company is unable to improve the operating margins of acquired businesses or operate them profitably, it may be unable to achieve its growth strategy.

In addition, if the Company makes one or more significant acquisitions in which the consideration includes equity shares or other securities or additional capital is raised through one or more equity financings, equity interests in Cambrex may be significantly diluted and may result in a dilution of earnings per share. If the Company makes one or more significant acquisitions in which the consideration includes cash, it may be required to use a substantial portion of its available cash or incur a significant amount of debt or otherwise arrange additional funds to complete the acquisition, which may result in reduced liquidity, a decrease in its net income and a consequential reduction in its earnings per share.

(dollars in thousands, except per share data)

13

The Company has a significant amount of debt.

The Company has a $250,000 revolving credit facility of which $60,000 was outstanding at December 31, 2014.  This facility expires in November 2016.  If the Company is unable to generate sufficient cash flow or otherwise obtain funds necessary to make required payments on the credit facility, it will be in default.  This current debt arrangement requires the Company to comply with specified financial ratios. The Company’s ability to comply with these ratios may be affected by events beyond its control.

Even if the Company is able to meet its debt service obligations, the amount of debt it has could adversely affect the Company by limiting its ability to obtain any necessary financing in the future for working capital, capital expenditures, debt service requirements, or other purposes.  It also may place the Company at a disadvantage relative to its competitors who may have lower levels of debt, while making it more vulnerable to a downturn in its business or the economy in general.  It may also require the Company to use a substantial portion of its cash to pay principal and interest on its debt.

The Company’s liquidity, business, financial condition, results of operations and cash flows could be materially and adversely affected if the financial institutions which hold its funds fail.

The Company has significant funds held in bank deposits, money market funds and other accounts at certain financial institutions.  A significant portion of the funds held in these accounts exceed insurable limits.  In the normal course of business, the Company maintains cash balances with European Union banks ranging from the equivalent of $1,000 - $10,000. The Company routinely monitors the risks associated with these institutions and diversifies its exposure by maintaining smaller balances with multiple financial institutions.  If any of the financial institutions where the Company has deposited funds were to fail, the Company may lose some or all of its deposited funds. Such a loss could have a material adverse effect on the Company’s liquidity, business, financial condition, results of operations and cash flows.

The Company has significant inventories on hand.

The Company maintains significant inventories and has an allowance for slow-moving and obsolete inventory. Any significant unanticipated changes in future product demand or market conditions, including obsolescence or the uncertainty in the global market, could also have an impact on the value of inventory and adversely impact the Company’s results of operations.

International unrest or foreign currency fluctuations could adversely affect the Company’s results.

The Company’s international revenues, which include revenues from its non-U.S. subsidiaries and export sales from the U.S., represent the majority of its product revenues.  The Company’s operations extend to numerous countries outside of the U.S.

There are a number of significant risks arising from the Company’s international business and the establishment of foreign operations, including:

· the possibility that nations or groups could boycott its products;

· inflation, foreign currency exchange rates and the impact of shifts in the U.S. and local economies on those rates;

· general economic decline or political unrest in the markets in which it operates;

· geopolitical risks, terrorism, or acts of war or hostility;

(dollars in thousands, except per share data)

14

· compliance with local laws and regulations including laws restricting the inflow of capital or cash and unexpected changes in regulatory requirements;

· the difficulties and expenses of compliance with a wide variety of foreign laws and regulations;

· longer accounts receivable cycles in certain foreign countries;

· import and export licensing requirements;

· government sanctions may reduce or eliminate the Company’s ability to sell its products in certain countries; and

· the protection of the Company’s intellectual property and that of its customers.

If the Company is unable to effectively manage these risks, these locations may not produce the revenues, earnings, or strategic benefits that it anticipates which could have a material adverse effect on the Company’s business.

A significant portion of the Company’s business is conducted in currencies other than the U.S. dollar, which is its reporting currency.  The Company recognizes foreign currency gains or losses arising from its operations in the period incurred.  As a result, currency fluctuations between the U.S. dollar and the currencies in which the Company does business have caused, and will continue to cause, foreign currency transaction gains and losses.  The Company cannot predict the effects of exchange rate fluctuations upon its future operating results because of the number of currencies involved, the variability of currency exposures, and the potential volatility of currency exchange rates.  The Company periodically engages in limited foreign exchange hedging transactions to mitigate the impact of this volatility on its operations, but its strategies are short-term in nature and may not adequately protect its operating results from the full effects of exchange rate fluctuations.

Finally, the Company operates in certain jurisdictions that have experienced governmental corruption to some degree and, in some circumstances, anti-bribery laws may conflict with some local customs and practices. As a result of the Company’s policy to comply with the U.S. Foreign Corrupt Practices Act and similar anti-bribery laws, the Company may be at a competitive disadvantage to competitors that are not subject to, or do not comply with, such laws.  Furthermore, while employees and agents must comply with these laws, the Company cannot be certain that internal policies and procedures will always prevent violations of these laws, despite a commitment to legal compliance and corporate ethics. Violations or mere allegations of such violations could have a material adverse effect on the Company’s business and reputation.

The Company’s operating results may unexpectedly fluctuate in future periods.

The Company’s revenue and operating results can fluctuate on a quarterly basis.  The operating results for a particular quarter may be higher or lower than expected as a result of a number of factors, including, but not limited to, the timing of contracts; the delay, cancellation or acceleration of a contract; seasonal slowdowns in different parts of the world; the timing of accounts receivable collections; pension contributions; changes in government regulations; and changes in exchange rates with the U.S. dollar.  Because a high percentage of the Company’s costs are relatively fixed in the short term, such as the cost of maintaining facilities and compensating employees, any one of these factors could have a significant impact on the Company’s quarterly results.  In some quarters, the Company’s revenue and operating results may be significantly lower than or higher than the expectations of securities analysts and investors due to any of the factors described above.

(dollars in thousands, except per share data)

15

The possibility the Company will be unable to protect its technologies could affect its ability to compete.

The Company’s success depends to some degree upon its ability to develop proprietary products and technologies.  However, the Company cannot be assured that patents will be granted on any of its patent applications.  The Company also cannot be assured that the scope of any of its issued patents will be sufficiently broad to offer meaningful protection.  The Company has patents issued in selected countries; therefore, third parties can make, use, and sell products covered by its patents in any country in which the Company does not have patent protection.  In addition, the Company may be involved in patent litigation in the future.  Issued patents or patents the Company licenses could be successfully challenged, invalidated or circumvented so that its patent rights would not create an effective competitive barrier.  Although the Company intends to defend the validity of owned patents and use all appropriate methods to prevent their infringement, such efforts are expensive and time consuming, with no assurance of success.  The ability to enforce patents depends on the laws of individual countries and each country’s practices regarding enforcement of intellectual property rights. The Company provides its customers the right to use its products under label licenses that are for research purposes only.  These licenses could be contested, and the Company cannot be assured that it would either be aware of an unauthorized use or be able to enforce the restrictions in a cost-effective manner.

If a third party claimed an intellectual property right to technology the Company uses, the Company may need to discontinue an important product or product line, alter its products and processes, defend its right to use such technology in court or pay license fees.  Although the Company may, under these circumstances, attempt to obtain a license to such intellectual property, it may not be able to do so on favorable terms, or at all.  Additionally, if the Company’s products are found to infringe on a third party’s intellectual property, the Company may be required to pay damages for past infringement, and lose the ability to sell certain products or receive licensing revenues.

The Company also relies on trade secrets, unpatented proprietary know-how and continuing technological innovation that it seeks to protect, in part by confidentiality agreements with licensees, suppliers, employees and consultants. It is possible that these agreements will be breached and the Company will not have adequate remedies for any such breach. Disputes may arise concerning the ownership of intellectual property or the applicability of confidentiality agreements. Furthermore, Cambrex’s trade secrets and proprietary technology may otherwise become known or be independently developed by its competitors or the Company may not be able to maintain the confidentiality of information relating to such products.

Information technology systems could fail to perform adequately or the Company may fail to adequately protect such systems against data corruption, cyber-based attacks, or network security breaches.

The Company utilizes information technology networks and systems to process, transmit, and store electronic information. In particular, the Company depends on information technology infrastructure to effectively manage its business data, supply chain, logistics, accounting, and other business processes and electronic communications between employees, customers and suppliers. Ineffective allocation and management of the resources necessary to build and sustain an appropriate technology infrastructure could adversely affect the Company’s business. In addition, security breaches or system failures of this infrastructure can create system disruptions, shutdowns, or unauthorized disclosure of confidential information. Inability to prevent such breaches or failures, could disrupt the Company’s operations or cause financial damage or loss because of lost or misappropriated information.

The Company may experience difficulties implementing its new global enterprise resource planning system.

The Company is engaged in a multi-year implementation of a new global enterprise resource planning system (“ERP”). The ERP is designed to accurately maintain the Company’s books and records and provide information important to the operation of the business to the Company’s management team. The Company’s ERP will continue to require significant investment of human and financial resources. In implementing the ERP, we may experience significant delays, increased costs and other difficulties.  Any significant disruption or deficiency in the design and implementation of the ERP could adversely affect the Company’s ability to process orders, ship product, send invoices and track payments, fulfill contractual obligations or otherwise operate its business. While the Company has invested significant resources in planning and project management, significant implementation issues may arise.

(dollars in thousands, except per share data)

16

The Company could be subject to impairment charges in the future.

Under U.S. GAAP, the Company is required to evaluate goodwill for impairment at least annually.  If the Company determines that the fair value is less than the carrying value, an impairment loss will be recorded in the Company’s statement of operations.  The determination of fair value is a highly subjective exercise and can produce significantly different results based on the assumptions used and methodologies employed.  If the Company’s projected long-term sales growth rate, profit margins or terminal rate are considerably lower or the assumed weighted average cost of capital is considerably higher, future testing may indicate impairment and the Company would have to record a non-cash goodwill impairment loss in its statement of operations.

Assessments by various tax authorities may be materially different than the Company has provided for and it may experience significant volatility in its annual and quarterly effective tax rate.

As a matter of course, the Company is regularly audited by federal, state, and foreign tax authorities.  From time to time, these audits result in proposed assessments.  In recent years, the Company utilized significant tax attributes such as domestic federal foreign tax credits to reduce U.S. cash taxes.  While the Company believes that it has adequately provided for any taxes related to these items, and taxes related to all other aspects of its business, any such assessments or future settlements may be materially different than it has provided.  Refer to Note 10 to the Company’s consolidated financial statements for a discussion of the Company’s income taxes.

The Company has deferred tax assets that it may not be able to use under certain circumstances.

If the Company is unable to generate future taxable income of sufficient amounts and type in certain jurisdictions, or if there is a significant change in tax rates or the time period within which taxable income is recognized, the Company could be required to increase its valuation allowances against its deferred tax assets resulting in an increase in its recorded tax expense and a potential adverse impact on future results.

Low investment performance by the Company’s defined benefit pension plan assets or other events including changes in regulations or actuarial assumptions may increase the Company’s pension expense, and may require the Company to fund a larger portion of its pension obligations, thus diverting funds from other potential uses.

The Company sponsors a defined benefit pension plan that covers certain eligible employees. The Company’s pension expense and required contributions to the pension plan are directly affected by changes in interest rates, the value of plan assets, the projected rate of return on plan assets, the actual rate of return on plan assets, and the actuarial assumptions used to measure the defined benefit pension plan obligations.  If plan assets perform below the assumed rate of return used to determine pension expense, future pension expense will increase. The proportion of pension assets to liabilities, which is called the funded status, determines the level of contribution to the plan that is required by law. Changes in the plan’s funded status related to the value of assets or liabilities could increase the amount required to be funded. The Company cannot predict whether changing market or economic conditions, regulatory changes or other factors will further increase the Company’s pension funding obligations, diverting funds from other potential uses.

 Any significant change in government regulation of the drug development process could have a material adverse effect on the Company.

The manufacturing of pharmaceutical products is subject to extensive regulation by governmental authorities, including the FDA, the European Medicines Agency and comparable regulatory authorities in other countries.  The process of obtaining regulatory approval to produce and market pharmaceutical products is rigorous, time-consuming, costly, and often unpredictable.  The Company’s business, as well as its customers’ business depends in part on strict government regulation of the drug development process.  Legislation may be introduced and enacted to modify regulations administered by the regulatory authorities and governing the drug approval process.  The Company may be unable to obtain requisite regulatory approvals on a timely basis for marketing and production of products.  Conversely, any significant reduction in the scope of regulatory requirements or the introduction of simplified drug approval procedures could reduce barriers to entry, increase competition, and have a material adverse effect on the Company’s business.

(dollars in thousands, except per share data)

17

Failure to comply with current Good Manufacturing Practices (“cGMP”) and other government regulations or delays in obtaining regulatory approval by the Company or its customers could have a material adverse effect on the Company.

All facilities and manufacturing techniques used for manufacturing products for clinical use or for commercial sale in the U.S. must be operated in conformity with cGMP regulations as required by the FDA and other comparable regulatory authorities in other countries, and for certain products, the DEA.  The Company’s facilities are subject to scheduled periodic regulatory and customer inspections to ensure compliance with cGMP and other requirements applicable to such products.  A finding that the Company had materially violated these requirements could result in regulatory sanctions including, but not limited to, the regulatory agencies withholding approval of new drug applications or supplements and the denial of entry into the U.S., or other countries, of products manufactured at non-compliant facilities, the loss of a customer contract, the disqualification of data for client submissions to regulatory authorities and a mandated closing of the Company’s facilities.  Any such violations would have a material adverse effect on the Company’s business.  The Company’s customers are typically subject to the same, or similar regulations and any such violations or other actions by regulatory agencies, including, but not limited to, plant shutdowns or product recalls that eliminate or reduce the Company’s sale of its products or services could negatively impact the Company’s business.  In addition, the submission of new products to regulatory authorities for approval by the Company or its customers does not guarantee the approval to market the product will be granted.  Each authority may impose its own requirements or delay or refuse to grant approval to the Company or customer even when the product has already been approved in another country.  Regulatory authorities have required, and may require in the future, that certain scientific data requirements be performed on the Company’s products and this may require additional testing.  Responding to such requirements may cause delays in or the cessation of the sales of one or more products which would adversely affect profitability.  The Company can provide no assurance that any testing approvals or registration will be granted on a timely basis, if at all, or that the Company’s resources will be adequate to meet the costs of regulatory compliance or that the economic benefit of complying with the requirement will exceed costs.

The overall level of late-stage clinical phase projects could decline and the outsourcing trends may decline, either of which could slow the Company’s growth.

The success of the Company’s business depends to a certain extent on the number of clinical phase contracts and the size of the contracts that it may obtain from pharmaceutical companies.  A decline in the level of clinical phase projects or a slowing of the outsourcing trend could result in a diminished growth rate in the Company’s sales and adversely affect its business, financial condition and results of operations.

Item 1B Unresolved Staff Comments.

None.

Item 2 Properties.

Set forth below is information relating to manufacturing facilities owned by the Company as of December 31, 2014:

Location	Acreage	Operating Subsidiary	Primary Product Lines Manufactured
Charles City, Iowa	57 acres	Cambrex	APIs and Pharmaceutical Intermediates
		Charles City, Inc.
Karlskoga, Sweden	42 acres	Cambrex	APIs and Pharmaceutical Intermediates
		Karlskoga AB
Paullo (Milan), Italy	12 acres	Cambrex	APIs and Pharmaceutical Intermediates
		Profarmaco Milano S.r.l.
Hyderabad, India	2 acres	Zenara Pharma Private Limited	Final Dosage Form Products

(dollars in thousands, except per share data)

18

The Company leases 10,000 square feet in Tallinn, Estonia which has a lease term ending in April 2024 and leases 6,000 square feet in Wiesbaden, Germany which has a lease term ending in December 2015.  The Company believes its operating facilities to be in good condition, well-maintained and adequate for its current needs.

The Company’s corporate headquarters are located in East Rutherford, N.J.

Item 3 Legal Proceedings.

See "Environmental and Safety Regulations and Proceedings" under Item 1 and Note 20 to the Company’s consolidated financial statements with respect to various proceedings involving the Company in connection with environmental matters.  The Company is party to a number of other proceedings also discussed in Note 20 to the Company’s consolidated financial statements.

Item 4 Mine Safety Disclosures.

None.

PART II

Item 5 Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

The Company’s common stock, $0.10 par value, is listed on the NYSE under the symbol CBM.  The following table sets forth the closing high and low sales price of the common stock as reported on the NYSE:

2014	High		Low
First Quarter	$	22.18	$	16.25
Second Quarter		22.14		17.55
Third Quarter		22.67		18.68
Fourth Quarter		24.12		16.33
2013	High		Low
First Quarter	$	12.79	$	11.27
Second Quarter		14.76		11.78
Third Quarter		15.55		12.76
Fourth Quarter		19.50		13.16

As of January 30, 2015, the Company estimates that there were approximately 6,915 beneficial holders of the outstanding common stock of the Company.

The Company does not anticipate paying cash dividends in the foreseeable future.

(dollars in thousands, except per share data)

19

2014 Equity Compensation Table

The following table provides information as of December 31, 2014 with respect to shares of common stock that may be issued under the Company’s existing equity compensation plans.

	Column (a)		Column (b)		Column (c)
Plan category	Number of securities to be issued upon exercise of outstanding options, warrants and rights		Weighted average exercise price of outstanding options, warrants and rights		Number of securities  remaining for future issuance under equity compensation plans (excluding securities reflected in column (a))
Equity compensation plans approved by security holders		2,026,172	$	12.24		640,331
Equity compensation plans not approved by security holders		44,500	$	4.57		-
Total		2,070,672				640,331

The material features of the equity compensation plan under which equity securities are authorized for issuance that was adopted without stockholder approval are described below:

2000 Employee Performance Stock Option Plan

The 2000 Employee Stock Option Plan (the “2000 Plan”) was used to fund awards for Non-Executive Employees of the Company.  The 2000 Plan is administered by the Compensation Committee of the Board of Directors, and that Committee may delegate responsibilities to others to assist in administering the 2000 Plan.  The total number of shares of common stock which may be issued on exercise of stock options shall not exceed 500,000 shares, subject to adjustment in accordance with the 2000 Plan.  No participant shall be granted options to purchase more than 100,000 shares of common stock in any twelve month period.  The options were priced at fair market value on the date of grant and expire up to 10 years after the date of grant.  If the employment of a participant terminates, other than as a result of death, disability or retirement, all unexercised awards shall be cancelled.  In the event of death, disability or retirement, the options will expire one year from the date of the event.  As of December 31, 2014 there were no shares remaining for future issuance under this plan.

(dollars in thousands, except per share data)

20

Comparison of Five-Year Cumulative Total Returns

The comparative stock performance graph below compares the five-year cumulative total stockholder return (assuming reinvestment of dividends, if any) from investing $100 on December 31, 2009, to the close of the last trading day of 2014, in each of (i) Cambrex common stock, (ii) the S&P 500 Index and (iii) an index of the Company’s peer group. The stock price performance reflected in the graph below is not necessarily indicative of future price performance.

The Company’s commercial activities are focused on manufacturing and marketing to customers concentrated in the Life Sciences Industry (including pharmaceutical chemicals and intermediates).  Although the Company’s products are diverse, the Company believes that an index of its peer group based on its GICS code is a reasonable comparison group for the commercial activities on which it currently focuses.  The peer group is for S&P GICS code 352030, Life Sciences Tools & Services, and is comprised of 54 companies as of December 31, 2014.

(dollars in thousands, except per share data)

21

Item 6 Selected Financial Data.

The following selected consolidated financial data of the Company for each of the five years in the period through December 31, 2014 are derived from the audited financial statements.  The consolidated financial statements of the Company as of December 31, 2014 and 2013 and for each of the years in the three year period ended December 31, 2014 and the reports of the independent registered public accounting firm are included elsewhere in this annual report.  The data presented below should be read in conjunction with the financial statements of the Company, the notes to the financial statements and "Management's Discussion and Analysis of Financial Condition and Results of Operations" included elsewhere.

	Years Ended December 31,
	2014(1)			2013(2)			2012(3)			2011(4)			2010(5)
INCOME DATA:
Gross sales	$	374,150		$	317,212		$	277,931		$	254,475		$	226,436
Net revenues		374,613			318,176			276,501			255,653			226,992
Gross profit		123,798			102,904			90,487			74,084			66,866
Selling, general and administrative expenses		52,489			47,568			45,248			39,227			34,024
Research and development expenses		13,075			10,387			9,544			11,037			10,305
Restructuring expenses		-			-			-			-			1,293
Merger and acquisition expenses		-			-			-			-			997
Loss on voluntary pension settlement		7,170			-			-			-			-
Gain on sale of asset		(1,234	)		(4,680	)		-			-			-
Operating profit		52,298			49,629			35,695			23,820			20,247
Interest expense, net		2,174			2,242			2,439			2,373			4,391
Equity in losses of partially-owned affiliates		4,623			2,262			1,766			1,621			286
Other (income)/expenses, net		(5	)		118			122			(111	)		596
Income before income taxes		45,506			45,007			31,368			19,937			14,974
(Benefit)/provision for income taxes		(12,627	)		14,732			(31,861	)		6,202			5,665
Income from continuing operations		58,133			30,275			63,229			13,735			9,309
(Loss)/income from discontinued operations, net of tax		(830	)		(4,360	)		(926	)		(2,767	)		338
Net income		57,303			25,915			62,303			10,968			9,647
EARNINGS PER SHARE DATA:
Earnings/(loss) per common share (basic):
Income from continuing operations	$	1.89		$	1.00		$	2.13		$	0.46		$	0.32
(Loss)/income from discontinued operations, net of tax	$	(0.03	)	$	(0.14	)	$	(0.03	)	$	(0.09	)	$	0.01
Net income	$	1.86		$	0.86		$	2.10		$	0.37		$	0.33
Earnings/(loss) per common share (diluted):
Income from continuing operations	$	1.84		$	0.98		$	2.09		$	0.46		$	0.32
(Loss)/income from discontinued operations, net of tax	$	(0.03	)	$	(0.14	)	$	(0.03	)	$	(0.09	)	$	0.01
Net income	$	1.81		$	0.84		$	2.06		$	0.37		$	0.33
Weighted average shares outstanding (in thousands):
Basic		30,763			30,150			29,703			29,468			29,361
Diluted		31,643			30,901			30,314			29,564			29,468
BALANCE SHEET DATA:  (at end of period)
Working capital	$	128,791		$	105,289		$	61,487		$	77,476		$	82,146
Total assets		487,072			458,037			385,731			342,831			351,751
Long-term debt		60,000			79,250			64,000			98,000			115,900
Total stockholders' equity		251,226			210,220			163,297			100,341			107,635

(dollars in thousands, except per share data)

22

(1) Income from continuing operations includes a pre-tax gain on the sale of land of $1,234 reduced for tax expense of $387, a charge of $7,170 related to a voluntary lump sum pension settlement, a loss of $4,122 related to the purchase of the remaining shares in Zenara, a benefit of $26,902 for the release of a valuation allowance and a benefit of $3,948 for the settlement of tax disputes.  Loss from discontinued operations includes pre-tax charges of $1,277, reduced for a tax benefit of $447, for environmental remediation related to sites of divested businesses.

(2) Income from continuing operations includes a pre-tax gain on the sale of an office building of $4,680 reduced for tax expense of $1,470, and a tax benefit related to changes in tax laws of $1,155.  Loss from discontinued operations includes pre-tax charges of $6,708, reduced for a tax benefit of $2,348, for environmental remediation related to sites of divested businesses.

(3) Income from continuing operations includes the release of a valuation allowance on domestic deferred tax assets of $36,287 and the impact on deferred taxes of a statutory rate change of $1,328.  Loss from discontinued operations includes pre-tax charges of $1,425, reduced for a tax benefit of $499, for environmental remediation related to sites of divested businesses.

(4) Loss from discontinued operations includes pre-tax charges of $2,851 for environmental remediation, net of insurance proceeds, related to sites of divested businesses.

(5) Income from continuing operations includes pre-tax charges of $1,293 for certain one-time employee benefits relating to the plan to optimize operations at a manufacturing site to meet industry requirements, $997 for merger and acquisition expenses and $509 for currency losses pursuant to the purchase of Zenara.   Income from discontinued operations includes a benefit of $1,652 as a result of the expiration of a contingent liability, charges of $1,144 for environmental remediation, net of insurance proceeds, and $170 for a worker's compensation claim, all related to sites of divested businesses.

Item 7 Management's Discussion and Analysis of Financial Condition and Results of Operations.

Executive Overview

The Company’s business primarily consists of three manufacturing facilities.  These facilities mainly manufacture APIs, pharmaceutical intermediates and, to a lesser extent, other fine chemicals.  The Company also owns Zenara, a pharmaceutical company with final dosage form manufacturing capabilities based in India and is not material to the financial results at this time.

The following significant events, which are explained in detail on the following pages, occurred during 2014:

· Gross sales in 2014 increased 17.9% to $374,150 from $317,212 in 2013.  Foreign currency exchange unfavorably impacted sales 1.5%.

· Operating profit increased 5.4% to $52,298 from 2013. Excluding certain one-time events, operating profit increased 29.6%.

· Debt, net of cash, decreased $42,023 to $14,482 during 2014.

· A charge of $7,170 was recorded within operating profit for a voluntary lump sum pension settlement.

· A charge of $4,122 related to the acquisition of the remaining interest in Zenara.

· A gain of $1,234 was recorded within operating profit for the sale of land.

· A tax benefit of $26,902 was recorded for the release of a valuation allowance.

· A tax benefit of $3,948 was recorded for the settlement of tax disputes.

(dollars in thousands, except per share data)

23

Gross sales in 2014 of $374,150 were $56,938 or 17.9% higher than 2013.  Excluding foreign currency, sales increased 19.4% as a result of higher volumes (+19.7%) partially offset by slightly lower pricing (-0.3%). The volume increase was primarily due to higher sales of certain branded APIs, controlled substances and generic APIs.  Also contributing to the increase in sales is the inclusion of Zenara’s results in the Company’s consolidated financial statements subsequent to the purchase of the remaining shares in Zenara during the second quarter of 2014. Zenara’s sales were $4,225 subsequent to the purchase.

Gross margins of 33.1% in 2014 were higher compared to 32.4% in 2013.  2014 gross margins included a 0.6% favorable impact from foreign currency versus 2013.  Excluding the foreign currency impact, gross margins were relatively flat.  Margins were positively impacted by favorable product mix and plant efficiencies mostly offset by higher production costs and lower pricing.

The Company reported income from continuing operations of $58,133, or $1.84 per diluted share in 2014, compared to $30,275 or $0.98 per diluted share in 2013.

Critical Accounting Estimates

The Company’s critical accounting estimates are those that require the most subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain.  The Company bases its estimates on historical experience and on other assumptions that are deemed reasonable by management under each applicable circumstance.  Actual results or amounts could differ from estimates and the differences could have a material impact on the consolidated financial statements.  A discussion of the Company’s critical accounting policies, the underlying judgments and uncertainties affecting their application and the likelihood that materially different amounts would be reported under different conditions or using different assumptions, is as follows:

Revenue Recognition

Revenues are generally recognized when title to products and risk of loss are transferred to customers.  Additional conditions for recognition of revenue are that collection of sales proceeds is reasonably assured and the Company has no further performance obligations.

Amounts billed in advance are recorded as deferred revenue on the balance sheet. Since payments received are sometimes non-refundable, the termination of a contract by a customer prior to its completion could result in an immediate recognition of deferred revenue relating to payments already received but not previously recognized as revenue.

Sales terms to certain customers include rebates if certain conditions are met.  Additionally, sales are generally made with a limited right of return under certain conditions.  The Company estimates these rebates and returns at the time of sale based on the terms of agreements with customers and historical experience and recognizes revenue net of these estimated costs which are classified as allowances and rebates.

The Company bills a portion of freight cost incurred on shipments to customers.  Amounts billed to customers are recorded within net revenues.  Freight costs are reflected in cost of goods sold.

Asset Valuations and Review for Potential Impairments

The review of long-lived assets, principally fixed assets and other amortizable intangibles, requires the Company to estimate the undiscounted future cash flows generated from these assets whenever events or changes in circumstances indicate that the carrying value may not be fully recoverable.  If undiscounted cash flows are less than the carrying value, the long-lived assets are written down to fair value.

(dollars in thousands, except per share data)

24

The review of the carrying value of goodwill and indefinite lived intangibles is conducted annually or whenever events or changes in circumstances indicate that the carrying value may not be fully recoverable utilizing a two-step process.  In the first step, the fair value of the reporting units is determined using a discounted cash flow model and compared to the carrying value.  If such analysis indicates that impairment may exist, the Company then estimates the fair value of the other assets and liabilities utilizing appraisals and discounted cash flow analyses to calculate an impairment charge.

The Company has investments in partially-owned affiliates.  It does not separately test an investee’s underlying assets for impairment but will recognize its share of any impairment charge recorded by an investee in earnings and consider the effect of the impairment on its investment.  A series of operating losses of an investee or other factors may indicate that a decrease in value of the investment has occurred that is other than temporary. A loss in value of an investment that is other than a temporary decline would be recognized as an impairment if the fair value of that investment is less than its carrying amount.

The determination of fair value is judgmental and involves the use of significant estimates and assumptions, including projected future cash flows primarily based on operating plans, discount rates, determination of appropriate market comparables and perpetual growth rates.  These estimates and assumptions could have a significant impact on whether or not an impairment charge is recognized and the magnitude of any such charge.

Income Taxes

The Company applies an asset and liability approach to accounting for income taxes.  Deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial statement and tax basis of assets and liabilities, and tax credit carryforwards, on a taxing jurisdiction basis using enacted tax rates in effect for the year in which the differences are expected to reverse or the tax credit carryforwards are expected to be realized.  The recoverability of deferred tax assets is dependent upon the Company’s assessment that it is more likely than not that sufficient future taxable income of the appropriate type and in the appropriate taxable years will be generated in the relevant tax jurisdictions to utilize the deferred tax assets.  When the Company determines that future taxable income will not be sufficient to utilize the deferred tax assets, a valuation allowance is recorded.  After release of a portion of the Company’s domestic valuation allowance in 2012 and 2014, the remaining domestic valuation allowance primarily relates to certain state deferred tax balances. The Company’s foreign valuation allowances primarily relate to net operating loss (“NOL”) carryforwards in foreign jurisdictions with little or no history of generating taxable income or where future profitability is uncertain.  The Company’s accounting for deferred taxes represents management’s best estimate of those future events. Changes in current estimates, due to unanticipated events, could have a material impact on the Company’s financial condition and results of operations.

Assumptions and Approach Used in Assessing the Need for a Valuation Allowance

The Company considers both positive and negative evidence related to the likelihood of realization of deferred tax assets. If, based on the weight of available evidence, it is more likely than not the deferred tax assets will not be realized, the Company records a valuation allowance against all or a portion of the deferred tax assets to adjust the balance to the amount considered more likely than not to be realized. The weight given to the positive and negative evidence is commensurate with the extent to which the evidence may be objectively verified.

This assessment, which is completed on a taxing jurisdiction basis, takes into account a number of types of evidence, including the following:

· Nature, frequency, and severity of current and cumulative financial reporting losses. A pattern of objectively-measured cumulative pre-tax losses over a three-year period is heavily weighted as a source of negative evidence. The Company also considers the strength and trend of earnings, as well as other relevant factors. In certain circumstances, historical information may not be as relevant due to changes in the Company’s business operations;

· Sources of future taxable income. Future reversals of existing temporary differences are heavily-weighted sources of objectively verifiable evidence. Projections of future taxable income exclusive of reversing temporary differences are a source of positive evidence only when the projections are combined with a history of recent profits and can be reasonably estimated; and

(dollars in thousands, except per share data)

25

· Tax planning strategies. Prudent and feasible tax planning strategies that would be implemented to maximize utilization of expiring tax credit carryforwards are evaluated as a source of additional positive evidence.

Valuation Allowance Assessment

In 2003, the Company’s assessment of the need for a valuation allowance against domestic deferred tax assets considered current and past performance, cumulative losses in recent years from domestic operations, and a shift in the geographic mix of forecasted income. Considering the pattern of then-recent domestic losses, the Company gave significant weight to projections showing future domestic losses for purposes of assessing the need for a valuation allowance. This assessment resulted in a determination that it was more likely than not that domestic deferred tax assets would not be realized, and as such, a valuation allowance against net domestic deferred tax assets was recorded.

A sustained period of domestic profitability along with expectations of future domestic profitability of sufficient amounts and character was required before the Company changed its judgment regarding the need for a full valuation allowance against net domestic deferred tax assets. During 2012, the Company concluded that its three-year cumulative domestic profitability through the end of 2012 and expectations of future domestic profitability warranted the reversal of all of the domestic valuation allowance attributable to net federal temporary differences, alternative minimum tax credits, and research and experimentation tax credits.  Additionally, the Company released a portion of the domestic valuation allowance attributable to federal foreign tax credits.  These valuation allowance releases resulted in a tax benefit to continuing operations of $36,287 in 2012.

Throughout 2014, the Company received updated customer projections that impacted current and future years’ income in amounts and type that support full utilization of the federal foreign tax credits.  Accordingly, the Company released the remaining domestic valuation allowance attributable to these foreign tax credits.  These valuation allowance releases resulted in a tax benefit to continuing operations of $26,902 in 2014.  The Company continues to provide a valuation allowance against a portion of foreign NOL carryovers and state items. It is possible that changes in the amount or type of future income could result in the release of additional valuation allowance attributable to these items in the future, or the establishment of a reserve against certain deferred tax assets for which the Company has no current reserves.

Environmental and Litigation Contingencies

The Company periodically assesses the potential liabilities related to any lawsuits or claims brought against it.  See Note 20 to the Company’s consolidated financial statements for a discussion of the Company’s current environmental and litigation matters, reserves recorded and its position with respect to any related uncertainties.  While it is typically very difficult to determine the timing and ultimate outcome of these actions, the Company uses its best judgment to determine if it is probable that the Company will incur an expense related to a settlement for such matters and whether a reasonable estimation of such probable loss, if any, can be made.  If probable and estimable, the Company accrues for the costs of investigation, remediation, settlements and legal fees.  Given the inherent uncertainty related to the eventual outcome of litigation and environmental matters, it is possible that all or some of these matters may be resolved for amounts materially different from any provisions that the Company may have made with respect to their resolution from time to time.

Employee Benefit Plans

The Company provides a range of benefits to certain employees and retired employees, including pension benefits.  The Company records annual amounts relating to these plans based on calculations, which include various actuarial assumptions, including discount rates, assumed rates of return and turnover rates.  The Company reviews its actuarial assumptions on an annual basis and makes modifications to the assumptions based on current rates and trends when it is deemed appropriate to do so.  The effect of the modifications is generally recorded and amortized over future periods.  The Company believes that the assumptions utilized for recording obligations under its plans are reasonable.

(dollars in thousands, except per share data)

26

The discount rate used to measure pension liabilities and costs is selected by projecting cash flows associated with plan obligations which are matched to a yield curve of high quality bonds.  The Company then selects the single rate that produces the same present value as if each cash flow were discounted by the corresponding spot rate on the yield curve.

Results of Operations

2014 Compared to 2013

Gross sales in 2014 of $374,150 were $56,938 or 17.9% higher than 2013.  Excluding foreign currency, sales increased 19.4% as a result of higher volumes (+19.7%) partially offset by slightly lower pricing (-0.3%). The volume increase was primarily due to higher sales of certain branded APIs, controlled substances and generic APIs.  Also contributing to the increase in sales is the inclusion of Zenara’s results in the Company’s consolidated financial statements subsequent to the purchase of the remaining shares in Zenara during the second quarter of 2014. Zenara’s sales were $4,225 subsequent to the purchase.

The Company’s products and services are sold to a diverse group of several hundred customers, with one customer accounting for 24.0% and 18.3% of 2014 and 2013 consolidated sales, respectively, and another customer accounting for 12.5% of 2012 consolidated sales.  The Company’s products are sold through a combination of direct sales and independent agents.  One API, an antiviral product, represented 22.9% of 2014 consolidated sales.

Gross profit in 2014 was $123,798 compared to $102,904 in 2013.  Gross margins of 33.1% in 2014 were higher compared to 32.4% in 2013.  2014 gross margins included a 0.6% favorable impact from foreign currency versus 2013.  Excluding the foreign currency impact, gross margins were relatively flat.  Margins were positively impacted by favorable product mix and plant efficiencies mostly offset by higher production costs and lower pricing.  2014 margins also benefited from the receipt of $1,900 from a business interruption insurance claim that covered 2014 and part of 2013.

Selling, general and administrative expenses of $52,489, or 14.0% of gross sales, in 2014 compared to $47,568, or 15.0%, in 2013. The increase in administrative expenses is mainly due to higher personnel (approximately $1,400) and medical expenses (approximately $700) as well as higher spending on costs related to completing the transaction to purchase the remaining shares in Zenara (approximately $500) and expenses related to due diligence on various acquisition opportunities (approximately $1,200). Sales and marketing expenses were also higher as a result of adding additional sales associates (approximately $1,400).

Research and development expenses of $13,075 were 3.5% of gross sales in 2014, compared to $10,387 or 3.3% of gross sales in 2013.  The increase is primarily due to increased headcount (approximately $1,800) and costs to develop a new generic drug product.

In the third quarter of 2014, the Company announced a program to offer a one-time option to elect to receive a voluntary lump-sum pension payout to certain former employees with deferred vested balances in the Company’s U.S. pension plan. As part of this voluntary lump-sum program, the Company settled $17,381 of pension obligations for the U.S. plan with an equal amount paid from plan assets. As a result, the Company recorded settlement losses of $7,170 reflecting the accelerated recognition of unamortized losses in the U.S. pension plan proportionate to the obligation that was settled. The loss on voluntary pension settlement is reflected as a separate line in the consolidated income statement with a corresponding balance sheet reduction in “Accumulated other comprehensive loss.”

Operating profit was $52,298 in 2014 compared to $49,629 in 2013.  The increase in operating profit is primarily due to higher gross profit and a gain on the sale of land of $1,234 partially offset by the pension settlement charge discussed above, higher operating expenses and a benefit related to a gain on sale of an office building of $4,680 in 2013.

(dollars in thousands, except per share data)

27

Net interest expense was $2,174 in 2014 compared to $2,242 in 2013.  The decrease in net interest expense is attributed to a decrease in average borrowing partially offset by lower interest income and lower capitalized interest as a result of fewer large capital projects under construction in 2014. The average interest rate on debt was 2.4% in 2014 versus 2.3% in 2013.

Equity in losses of partially-owned affiliates was $4,623 and $2,262 in 2014 and 2013, respectively, primarily representing Zenara’s results. The Company’s portion of Zenara’s loss, prior to the purchase of the remaining shares in May 2014, was $458 and $1,956 for 2014 and 2013, respectively.  These amounts include amortization expense of $333 and $882 for 2014 and 2013, respectively. In addition, 2014 includes a loss of $4,122 related to the purchase of the remaining shares in Zenara.

The Company recorded a tax benefit of $12,627 in 2014 compared to expense of $14,732 in 2013.  The tax benefit for 2014 includes a benefit of $26,902 for a reversal of domestic valuation allowances.  The reversal of the valuation allowance in 2014 resulted from the Company’s assessment of realizability of domestic federal foreign tax credit carryforwards due to expected future U.S. taxable income in amounts and type that support utilization of these credits.  Excluding the effects of the valuation allowance reversal, tax audit settlements, the loss on voluntary pension settlement, the sale of the land, and the Zenara loss, the effective tax rate was 32.1% in 2014 compared to 32.7% in 2013.  The lower effective tax rate in 2014 was mostly due to differences in the geographical mix of income.

In 2009, a subsidiary of the Company was examined by a European tax authority, which challenged the business purpose of the deductibility of certain intercompany transactions from 2003 and issued formal assessments against the subsidiary.  The Company had several favorable rulings in the courts on this matter, although the rulings were appealed by the tax authority.  At the same time, considering the hazards of litigation, the Company pursued settlement negotiations.  During the fourth quarter of 2014, the Company entered into a final settlement with the tax authority in order to avoid further litigation, without any admission of fault or breach of law.  The settlement required the Company to pay $1,487 in tax and interest during the fourth quarter of 2014 in full satisfaction of all liabilities for this matter, and in response the tax authority withdrew all pending litigation and renounced any outstanding claims.  The settlement did not impose any penalties on the Company. Therefore, in the fourth quarter of 2014 the Company decreased its remaining reserve for unrecognized tax benefits for this matter by $4,137.

Income from continuing operations in 2014 was $58,133 or $1.84 per diluted share, versus $30,275, or $0.98 per diluted share in 2013.  Income from continuing operations in 2014 includes a tax benefit of $26,902, or $0.85 per diluted share, resulting from the release of a valuation allowance on deferred tax assets.

2013 Compared to 2012

Gross sales in 2013 of $317,212 were $39,281 or 14.1% higher than 2012.  Excluding foreign currency, sales increased 12.8% as a result of higher volumes (+11.5%) and higher pricing (+1.3%). The volume increase was primarily due to higher sales of a recently approved branded API.  Partially offsetting this increase was lower volumes of generic APIs, controlled substances, branded APIs and products utilizing the Company’s drug delivery technology.

The Company’s products and services are sold to a diverse group of several hundred customers, with one customer accounting for 18.3% of 2013 consolidated sales.  The Company’s products are sold through a combination of direct sales and independent agents.  Two APIs, one an antiviral, and the other a gastrointestinal product that is sold to multiple customers, represented 18.3% and 10.0% of 2013 consolidated sales, respectively.

Gross profit in 2013 was $102,904 compared to $90,487 in 2012.  Gross margins were 32.4% in 2013 compared to 32.6% in 2012.  Gross margins in 2013 included a 0.3% unfavorable impact from foreign currency versus 2012.  Gross margins were positively impacted by higher pricing offset by unfavorable product mix.

Selling, general and administrative expenses of $47,568, or 15.0% of gross sales, in 2013 compared to $45,248, or 16.3%, in 2012.  This increase is primarily related to higher stock-based compensation expense as a result of the Company’s performance compared to a peer group and the Company’s higher stock price (approximately $1,400) and an unfavorable impact from foreign exchange (approximately $800).  Sales and marketing expenses were flat year over year.

(dollars in thousands, except per share data)

28

Research and development expenses of $10,387 were 3.3% of gross sales in 2013, compared to $9,544 or 3.4% of gross sales in 2012.  The increase is primarily due to increased headcount (approximately $1,000) and an unfavorable impact from foreign exchange (approximately $300). Higher absorption of R&D expenses into inventory and cost of goods sold as a result of increased revenue generating custom development activity (approximately $500) partially offset these increases.

Operating profit was $49,629 in 2013 compared to $35,695 in 2012.  The increase is due to higher gross profit and a $4,680 gain on sale of an office building partially offset by higher operating expenses discussed above.

Net interest expense was $2,242 in 2013 compared to $2,439 in 2012.  The decrease in net interest expense is attributed to higher capitalized interest as a result of multiple large capital projects under construction during 2013. This decrease was partially offset by higher average debt and higher interest rates in 2013.  The average interest rate on debt was 2.3% in 2013 versus 2.2% in 2012.

In November 2010, the Company acquired a 51% equity stake in Zenara, a pharmaceutical company focused on the formulation of final dosage form products based in India.  Cambrex accounts for its investment in Zenara using the equity method of accounting.  The impact of its ownership stake in Zenara was a loss of $1,956 and $1,976 in 2013 and 2012, respectively, and is located within “Other expenses/(income)” as “Equity in losses of partially-owned affiliates” in the Company’s income statement.  These amounts include amortization expense of $882 and $965 in 2013 and 2012, respectively and depreciation expense of $130 and $132 in 2013 and 2012, respectively.  Equity in losses of partially-owned affiliates also includes a loss of $311 and a gain of $210 in 2013 and 2012, respectively, related to an investment in a European joint venture.

The Company recorded tax expense of $14,732 in 2013 compared to a benefit of $31,861 in 2012.  The tax benefit for 2012 includes a benefit of $36,287 for a reversal of domestic valuation allowances.  Additionally, 2013 and 2012 include benefits of $95 and $8,818, respectively, for changes in valuation allowances to offset expense and benefit generated from domestic income, tax credits, and losses in certain foreign jurisdictions.  The reversal of the valuation allowance in 2012 resulted from the Company’s assessment of realizability of domestic deferred tax assets and tax credit carryforwards due to expected future profitability in the U.S., among other factors.  Since 2003, the Company had maintained a full valuation allowance on the tax benefits arising from domestic pre-tax losses, U.S. tax credits and net deferred tax balances.  Excluding the effect of the valuation allowance reversal and the effect of remeasuring certain foreign deferred tax liabilities due to a change in enacted tax rates in 2012, the effective tax rate was 32.7% in 2013 compared to 18.3% in 2012.  The lower effective tax rate in 2012 was mostly due to domestic tax expense on U.S. income in 2012 being offset by utilization of fully valued domestic tax attributes, prior to release of the domestic valuation allowance.

In 2009, a subsidiary of the Company was examined by a European tax authority, which challenged the business purpose of the deductibility of certain intercompany transactions from 2003 and issued formal assessments against the subsidiary.  In 2010, the Company filed to litigate the matter.  The first court date, which pertained to the smaller of the assessments, was held in 2011, after which the court issued its ruling in favor of the Company.  The tax authorities appealed this ruling and the appeals court again ruled in the Company’s favor in 2012.   In 2013, the court issued additional rulings in favor of the Company.

Income from continuing operations in 2013 was $30,275 or $0.98 per diluted share, versus $63,229, or $2.09 per diluted share in 2012.  Income from continuing operations in 2012 includes a tax benefit of $36,287, or $1.20 per diluted share, resulting from the release of a valuation allowance on deferred tax assets.

(dollars in thousands, except per share data)

29

Liquidity and Capital Resources

During 2014, cash flows from operations provided $64,968, compared to $36,874 in the same period a year ago.  The increase in cash flows from operations in 2014 compared to 2013 was largely due to collections of accounts receivable as a result of large shipments in the fourth quarter of 2013, changes in inventory levels and higher net income.  Cash flows used in investing activities in 2014 of $24,798 mainly reflects cash flows related to capital expenditures of $23,323.  Cash flows used in financing activities in 2014 of $14,525 mainly reflects the pay down of the Company’s debt partially offset by proceeds from stock options exercised.  Debt, net of cash, decreased $42,023 during 2014.

In November 2011, the Company entered into a $250,000 five-year Syndicated Senior Revolving Credit Facility (“Credit Facility”) which expires in November 2016.  The Company pays interest on this Credit Facility at LIBOR plus 1.75% - 2.50% based upon certain financial measurements.  The Credit Facility also includes financial covenants regarding interest coverage and leverage ratios. The Company was in compliance with all financial covenants at December 31, 2014.

In March 2012, the Company entered into an interest rate swap with a notional value of $60,000, at a fixed rate of 0.92%, maturing in September 2015.  The Company’s strategy has been to cover a portion of its outstanding floating rate debt with fixed interest rate protection.  At December 31, 2014 the Company had floating rate debt of $60,000, which was fixed by the interest rate swap.

The 2014 and 2013 weighted average interest rates for long-term bank debt were 2.4% and 2.3%, respectively.

For 2015, capital expenditures are expected to be approximately $80,000 to $85,000.

Contractual Obligations

At December 31, 2014, the Company’s contractual obligations with initial or remaining terms in excess of one year were as follows:

	Total		2015		2016		2017		2018		2019		2020+
Long term debt	$	60,000	$	-	$	60,000	$	-	$	-	$	-	$	-
Interest on debt		2,206		1,352		854		-		-		-		-
Operating leases		3,193		1,194		600		588		528		193		90
Purchase obligations		7,588		7,588		-		-		-		-		-
Contractual cash obligations	$	72,987	$	10,134	$	61,454	$	588	$	528	$	193	$	90

In addition to the contractual obligations listed above, the Company expects to contribute approximately $1,900 in cash to its U.S. defined-benefit pension plan in 2015.  It is possible that higher pension contributions could be required in 2016 and beyond.  For the unfunded SERP and international pension plans, the Company expects to make benefit payments of approximately $1,300 in 2015 and similar amounts in 2016 through 2018.  See Note 17 to the Company’s consolidated financial statements for details on the Company’s unfunded balance related to its pension plans.  Also not included in the table above is $2,132 of uncertain tax positions due to uncertainties surrounding the timing of the obligation. See Note 10 to the Company’s consolidated financial statements.  The Company may be required to make cash payments to remediate certain environmental sites at unknown future periods as discussed in Note 20 to the Company’s consolidated financial statements.

See Notes 11, 17, 19 and 20 to the Company’s consolidated financial statements for additional information regarding the Company’s pension plans, debt and other commitments.

(dollars in thousands, except per share data)

30

The Company’s forecasted cash flow from future operations may be adversely affected by various factors including, but not limited to, declines in customer demand, increased competition, the deterioration in general economic and business conditions, interest rates, returns on assets within the Company’s domestic pension plan that are significantly below expected performance, tax audit payments, as well as other factors.  See the Risk Factors section of this document for further explanation of factors that may negatively impact the Company’s cash flows.  Any change in the current status of these factors could adversely impact the Company's ability to fund operating cash flow requirements.

Market Risks

Currency Risk Management

The Company's primary market risk relates to exposure to foreign currency exchange rate fluctuations on transactions entered into by international operations which are primarily denominated in the U.S. dollar, euro and Swedish krona. The Company may use foreign currency exchange forward contracts to mitigate the effect of short-term foreign exchange rate movements on the Company's operating results. As a matter of policy, the Company does not hedge to protect the translated results of foreign operations.   The notional amount of these contracts as of December 31, 2014 was $3,632.  The foreign exchange contracts have varying maturities with none exceeding twelve months.

With respect to the contracts outstanding at December 31, 2014, a 10% fluctuation of the local currency over a one-year period would cause approximately $350 pre-tax earnings to be at risk.  These calculations do not include the impact of exchange gains or losses on the underlying positions that would offset the gains and losses of the derivative instrument.

Interest Rate Management

The Company has employed a plan to mitigate interest rate risk by entering into an interest rate swap agreement.  The swap is a contract to exchange floating rate for fixed interest payments periodically over the life of the agreement without the exchange of the underlying notional debt amount.  As of December 31, 2014, the Company had an interest rate swap in place with a notional value of $60,000, at a fixed rate of 0.92% and a maturity date of September 2015.  The Company’s strategy has been to cover a portion of outstanding bank debt with interest rate protection.  At December 31, 2014, the coverage was 100% of the Company’s variable interest rate debt.  Since all outstanding debt is at a fixed rate, there would be no impact to the Company’s earnings and cash flows given a change in market interest rates.

Contingencies

The Company is subject to various investigations, claims and legal proceedings covering a wide range of matters that arise in the ordinary course of its business activities.  The Company continually assesses known facts and circumstances as they pertain to applicable legal and environmental matters and evaluates the need for reserves and disclosures as deemed necessary based on these facts and circumstances.  These matters, either individually or in the aggregate, could result in actual costs that are significantly higher than the Company’s current assessment and could have a material adverse effect on the Company's operating results and cash flows in future reporting periods. While these matters could have a material adverse effect on the Company’s financial condition, based upon past experience, the Company believes that payments significantly in excess of current reserves, if required, would be made over an extended number of years.

Environmental

In connection with laws and regulations pertaining to the protection of the environment, the Company and its subsidiaries are a party to several environmental proceedings and remediation activities and along with other companies, have been named a potentially responsible party (“PRP”) for certain waste disposal sites ("Superfund sites").  Substantially all of the liabilities currently recorded on the Company’s balance sheet for environmental proceedings are associated with discontinued operations. The Company had insurance policies in place at certain of the discontinued operations for certain years that the Company believes should cover some portion of currently recorded liabilities or potential future liabilities.

(dollars in thousands, except per share data)

31

It is the Company’s policy to record appropriate liabilities for environmental matters where remedial efforts are probable and the costs can be reasonably estimated.  Such liabilities are based on the Company’s estimate of the undiscounted future costs required to complete the remedial work.  Each of these matters is subject to various uncertainties, and it is possible that some of these matters will be decided against the Company. The resolution of such matters often spans several years and frequently involves regulatory oversight or adjudication.  Additionally, many remediation requirements are fluid and are likely to be affected by future technological, site and regulatory developments.  It is not possible at this time for the Company to determine fully the effect of all asserted and unasserted claims on its consolidated financial condition, results of operations or liquidity; however, to the extent possible, where asserted and unasserted claims can be estimated and where such claims are considered probable, the Company would record a liability. Consequently, the ultimate liability with respect to such matters, as well as the timing of cash disbursements, is uncertain.

In matters where the Company is able to reasonably estimate the probable and estimable costs associated with environmental proceedings, the Company accrues for the estimated costs associated with the study and remediation of applicable sites. These reserves were $9,595 and $10,881 at December 31, 2014 and 2013, respectively. The decrease in the reserve includes payments of $2,269 and the impact of currency translation of $226 partially offset by adjustments to reserves of $1,209. The reserves are adjusted periodically as remediation efforts progress or as additional technical, regulatory or legal information becomes available.  Given the uncertainties regarding the outcome of investigative and study activities, the status of laws, regulations, enforcement, policies, the impact of other PRPs, technology and information related to individual sites, the Company does not believe it is possible to currently develop an estimate of the range of reasonably possible environmental loss in excess of its reserves.

CasChem

As a result of the sale of a Bayonne, New Jersey facility, the Company became obligated to investigate site conditions and conduct required remediation under the New Jersey Industrial Site Recovery Act.  The Company intends to continue implementing a sampling plan at the property pursuant to the New Jersey Department of Environmental Protection’s (“NJDEP”) private oversight program.  The results of the completed sampling, and any additional sampling deemed necessary, will be used to develop an estimate of the Company's future liability for remediation costs.  As of December 31, 2014, the Company’s reserve for the investigation of site conditions was $193.

Cosan

The Company has implemented a sampling and pilot program in Clifton, New Jersey pursuant to the NJDEP private oversight program.  The results of the sampling and pilot program to date have been used to develop an estimate of the Company's future liability for remediation costs.  As of December 31, 2014, the Company’s reserve was $1,191.

Additionally, the Company has implemented a sampling and pilot program in Carlstadt, New Jersey pursuant to the NJDEP private oversight program.  The results of the sampling and pilot program to date have been used to develop an estimate of the Company's future liability for remediation costs. As of December 31, 2014, the Company’s reserve was $1,063.

(dollars in thousands, except per share data)

32

Berry’s Creek

The Company received a notice from the United States Environmental Protection Agency (“USEPA”) that two subsidiaries of the Company are considered PRPs at the Berry’s Creek Study Area in New Jersey.  These subsidiaries are among many other PRPs that were listed in the notice.  Pursuant to the notice, the PRPs have been asked to perform a remedial investigation and feasibility study of the Berry’s Creek site. The Company has joined the group of PRPs and entered into an Administrative Settlement Agreement (“Agreement”) and Order on Consent with the USEPA agreeing to jointly conduct or fund an appropriate remedial investigation and feasibility study of the Berry’s Creek site with the other PRPs in the Agreement. The PRPs have engaged consultants to perform the work specified in the Agreement and develop a method to allocate related costs among the PRPs.  As of December 31, 2014, the Company’s reserve was $388 to cover the current phase of investigation based on a tentative agreement on the allocation of the site investigation costs among the PRPs.   Due to the very preliminary and uncertain nature of any estimates related to the method and costs of any remediation solution, the number of eventual PRPs, and their respective proportion of remediation costs, the Company’s liability cannot be reasonably estimated at this time; as such, no accrual is recorded for these potential future costs. The impact of the resolution of this matter on the Company’s results of operations in any future reporting period is not known.

In July 2014, the Company received a notice from the U.S. Department of the Interior, U.S. Fish & Wildlife Service, regarding the Company’s potential liability for natural resource damages at the Berry’s Creek site and inviting the Company to participate in a cooperative assessment of natural resource damages.  All members of the Berry’s Creek PRP group are receiving such notice letters, and any response from the Company will be coordinated with the PRP Group.  The substance of any response from the Company, the cost of any assessment, and the ultimate scope of natural resource damage liability are not yet known.

Maybrook Site

A subsidiary of Cambrex is named a PRP of a site in Hamptonburgh, New York by the USEPA in connection with the discharge, under appropriate permits, of wastewater at that site prior to Cambrex's acquisition in 1986.  The PRPs implemented soil remediation which was completed in 2012 pending approval by the USEPA.  The PRPs will continue implementing the ground water remediation at the site. As of December 31, 2014, the Company’s reserve was $322 to cover remaining ground water remediation and long-term monitoring.

Harriman Site

Subsidiaries of Cambrex and Pfizer are named as responsible parties for the Company’s former Harriman, New York production facility by the New York State Department of Environmental Conservation (“NYSDEC”).  A final ROD (“Record of Decision”) describing the Harriman site remediation responsibilities for Pfizer and the Company was issued in 1997 (the "1997 ROD") and incorporated into a federal court Consent Decree in 1998 (the “Consent Decree”).  Site clean-up work under the 1997 ROD is ongoing and is being jointly performed by Pfizer and the Company, with NYSDEC oversight.  ELT Harriman, LLC ("ELT"), the current owner of the Harriman site, is conducting other investigation and remediation activities under a separate NYSDEC directive.

In October 2013, the NYSDEC sent the Company, Pfizer, ELT and the immediately preceding owner Vertellus Specialties Holdings (“Vertellus”) an enforcement letter demanding that the Company and Pfizer submit a work plan for the further study and remediation of certain areas of the Harriman site, including the evaluation of certain remedies that the Company has contended are not required by the 1997 ROD.  In December 2013, the Company, Pfizer and the NYSDEC entered into a federal court stipulation, which the court subsequently endorsed as a court order, withdrawing the October 2013 enforcement letter as it relates to the Company and Pfizer, and resolving certain disputes about the scope of their obligations under the Consent Decree and the 1997 ROD.  Pursuant to the court order, the Company and Pfizer are required to carry out an environmental investigation and study of certain areas of the Harriman Site.

No final remedy for the site has been determined, which will follow further discussions with the NYSDEC.  The Company estimated the range for its share of the liability at the site to be between $2,000 and $7,000.  As of December 31, 2014, the Company’s reserve was $3,615.  At this time, the Company is unable to provide an estimate of the ultimate investigative and remedial costs to the Company for any final remedy selected by the NYSDEC.

The Company intends to enforce all of its contractual rights to recover costs and for indemnification under a 2007 settlement agreement, and has filed such claims in an arbitration proceeding against ELT and Vertellus. ELT has filed counterclaims, and has threatened to file additional counterclaims, for contractual indemnification and for breach of the settlement agreement against the Company.  Currently, the arbitration proceeding is stayed indefinitely.

(dollars in thousands, except per share data)

33

Scientific Chemical Processing (“SCP”) Superfund Site

A subsidiary of Cambrex was named a PRP of the SCP Superfund site, located in Carlstadt, New Jersey, along with approximately 130 other PRPs.  The site is a former waste processing facility that accepted various waste for recovery and disposal including processing wastewater from this subsidiary.  The PRPs are in the process of implementing a final remedy at the site.  The SCP Superfund site has also been identified as a PRP in the Berry’s Creek Superfund site (see previous discussion). For over a decade, the remediation has been funded by de minimus settlements and by the insurers of the SCP Superfund site’s owners and operators.  However, due to an unexpected increase in remediation costs at the site and costs related to SCP’s involvement in the Berry’s Creek investigation, the PRP group approved the assessment of an additional cash contribution by the PRP group.  While the Company continues to dispute the methodology used by the PRP group to arrive at its allocation for the cash contribution, the Company has paid the recent funding requests in 2010 and 2014.  The next funding request is expected in 2015. A final allocation of SCP Site costs is expected to be developed concurrent with the final allocation process for Berry’s Creek Study Area starting in 2015.  As of December 31, 2014, the Company’s reserve was $1,039, of which approximately $737 is expected to be covered by insurance.

Newark Bay Complex

Two subsidiaries of the Company were named along with several hundred third-party defendants in a third-party complaint filed in February 2009, by Maxus Energy Corporation (“Maxus”) and Tierra Solutions, Inc. (“Tierra”) relating to a N.J. state action concerning the  Passaic River, Newark Bay, Hackensack River, Arthur Kill, Kill Van Kull and adjacent waters (the “Newark Bay Complex”).  The Company settled this case which resolved certain New Jersey state based claims related to the Newark Bay Complex. The settlement will require Maxus and Tierra to re-file  any further claims against the Company in federal court.   In preparation for any such federal or similar claims, the Company is currently monitoring developments regarding the Newark Bay Complex.  Due to the uncertainty of the future scope and timing of any such claims, the Company’s liability cannot be reasonably estimated at this time, and as such, no accrual is recorded for these potential future costs.

The Company is involved in other related and unrelated environmental matters where the range of liability is not reasonably estimable at this time and it is not foreseeable when information will become available to provide a basis for adjusting or recording a reserve, should a reserve ultimately be required.

Litigation and Other Matters

Lorazepam and Clorazepate

In 1998, the Company and a subsidiary were named as defendants along with Mylan Laboratories, Inc. (“Mylan”) and Gyma Laboratories, Inc. (“Gyma”) in a proceeding instituted by the Federal Trade Commission in the United States District Court for the District of Columbia (the “District Court”). Suits were also commenced by several State Attorneys General and class action complaints by private plaintiffs in various state courts. The suits alleged violations of the Federal Trade Commission Act arising from exclusive license agreements between the Company and Mylan covering two APIs (Lorazepam and Clorazepate).

All cases have been resolved except for one brought by four health care insurers. In the remaining case, the District Court entered judgment after trial in 2008 against Mylan, Gyma and Cambrex in the total amount of $19,200, payable jointly and severally, and also a punitive damage award against each defendant in the amount of $16,709.  In addition, at the time, the District Court ruled that the defendants were subject to a total of approximately $7,500 in prejudgment interest. The case is currently pending before the District Court following a January 2011 remand by the Court of Appeals.  In July 2014, the District Court dismissed certain customers for which the plaintiffs were unable to establish jurisdiction and consequently, the plaintiffs currently have a motion pending before the District Court to reduce the damages award by a total of $9,600.

(dollars in thousands, except per share data)

34

In 2003, Cambrex paid $12,415 to Mylan in exchange for a release and full indemnity against future costs or liabilities in related litigation brought by the purchasers of Lorazepam and Clorazepate, as well as potential future claims related to the ongoing matter.  Mylan has submitted a surety bond underwritten by a third-party insurance company in the amount of $66,632.  In the event of a final settlement or final judgment, Cambrex expects any payment required by the Company to be made by Mylan under the indemnity described above.

Other

The Company has commitments incident to the ordinary course of business including corporate guarantees of certain subsidiary obligations to the Company’s lenders related to financial assurance obligations under certain environmental laws for remediation; closure and third party liability requirements of certain of its subsidiaries and a former operating location; contract provisions for indemnification protecting its customers and suppliers against third party liability for the manufacture and sale of Company products that fail to meet product warranties and contract provisions for indemnification protecting licensees against intellectual property infringement related to licensed Company technology or processes.

Additionally, as permitted under Delaware law, the Company indemnifies its officers, directors and employees for certain events or occurrences while the officer, director or employee is, or was, serving at the Company’s request in such capacity. The term of the indemnification period is for the officer's, director's or employee’s lifetime. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited; however, the Company has a director and officer insurance policy that covers a portion of any potential exposure.  The Company currently believes the estimated fair value of its indemnification agreements is not material based on currently available information, and as such, the Company had no liabilities recorded for these agreements as of December 31, 2014.

Cambrex's subsidiaries are party to a number of other proceedings that are not considered material at this time.

Impact of Recent Accounting Pronouncements

Revenue from Contracts with Customers

In May 2014, the FASB issued ASU 2014-09 that introduces a new five-step revenue recognition model in which an entity should recognize revenue to depict the transfer of promised 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. This ASU also requires disclosures sufficient to enable users to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers, including qualitative and quantitative disclosures about contracts with customers, significant judgments and changes in judgments, and assets recognized from the costs to obtain or fulfill a contract. This standard is effective for fiscal years beginning after December 15, 2016, including interim periods within that reporting period. The Company is currently evaluating the new guidance to determine the impact, if any, it will have on its consolidated financial statements.

Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity

In April 2014, the FASB issued ASU 2014-08, which includes amendments that change the requirements for reporting discontinued operations and require additional disclosures about discontinued operations. Under the new guidance, only disposals representing a strategic shift in operations - that is, a major effect on the organization's operations and financial results should be presented as discontinued operations. Additionally, the ASU requires expanded disclosures about discontinued operations that will provide financial statement users with more information about the assets, liabilities, income and expenses of discontinued operations. This update is effective in the first quarter of 2015. This pronouncement will not have an impact on the Company’s financial position or results of operations.

(dollars in thousands, except per share data)

35

Item 7A Quantitative and Qualitative Disclosures about Market Risk.

The information required in this section can be found in the “Market Risks” section of Item 7 on page 31 of this Form 10-K.

Item 8 Financial Statements and Supplementary Data.

The following consolidated financial statements and selected quarterly financial data of the Company are filed under this item:

	Page Number (in this Report)
Reports of Independent Registered Public Accounting Firm	37
Consolidated Balance Sheets as of December 31, 2014 and 2013	39
Consolidated Income Statements for the Years Ended December 31, 2014, 2013 and 2012	40
Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2014, 2013 and 2012	41
Consolidated Statements of Stockholders' Equity for the Years Ended December 31, 2014, 2013 and 2012	42
Consolidated Statements of Cash Flows for the Years Ended December 31, 2014, 2013 and 2012	43
Notes to Consolidated Financial Statements	44
Selected Quarterly Financial and Supplementary Data (unaudited)	76

The financial statement schedules are filed pursuant to Item 15 of this report.

36

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of Cambrex Corporation,

We have audited the accompanying consolidated balance sheets of Cambrex Corporation as of December 31, 2014 and 2013 and the related consolidated statements of income, comprehensive income, stockholders’ equity, and cash flows for each of the three years in the period ended December 31, 2014. In connection with our audits of the financial statements, we have also audited the financial statement schedule listed in the accompanying index.  These financial statements and schedule are the responsibility of the Company’s management.  Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and schedule.  We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Cambrex Corporation at December 31, 2014 and 2013, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2014, in conformity with accounting principles generally accepted in the United States of America.

Also, in our opinion, the financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, present fairly, in all material respects, the information set forth therein.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Cambrex Corporation’s internal control over financial reporting as of December 31, 2014, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) and our report dated February 6, 2015 expressed an unqualified opinion thereon.

/s/ BDO USA, LLP

Woodbridge, NJ

February 6, 2015

37

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Shareholders of Cambrex Corporation,

We have audited Cambrex Corporation’s internal control over financial reporting as of December 31, 2014, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (the COSO criteria). Cambrex Corporation’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying “Item 9A, Management’s Report on Internal Control Over Financial Reporting.” Our responsibility is to express an opinion on the company’s internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company’s internal control over financial reporting is a process designed 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. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, Cambrex Corporation maintained, in all material respects, effective internal control over financial reporting as of December 31, 2014, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of Cambrex Corporation as of December 31, 2014 and 2013, and the related consolidated statements of income, comprehensive income, stockholders’ equity, and cash flows for each of the three years in the period ended December 31, 2014 and our report dated February 6, 2015 expressed an unqualified opinion thereon.

/s/ BDO USA LLP

Woodbridge, NJ

February 6, 2015

38

CAMBREX CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(dollars in thousands, except per share data)

	December 31,
	2014			2013
ASSETS
Current assets:
Cash and cash equivalents	$	45,518		$	22,745
Trade receivables, less allowances of $346 and $1,058 at respective dates		77,124			71,276
Other receivables		10,610			12,943
Inventories, net		85,630			89,965
Prepaid expenses and other current assets		8,688			5,631
Total current assets		227,570			202,560
Property, plant and equipment, net		163,567			171,966
Goodwill		43,912			38,670
Intangible assets, net		8,902			4,011
Investments in and advances to partially-owned affiliates		665			13,364
Deferred income taxes		38,424			19,799
Other non-current assets		4,032			7,667
Total assets	$	487,072		$	458,037
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	43,670		$	29,052
Deferred revenue		14,095			20,121
Accrued expenses and other current liabilities		41,014			48,098
Total current liabilities		98,779			97,271
Long-term debt		60,000			79,250
Deferred income taxes		10,545			12,835
Accrued pension benefits		50,949			40,123
Other non-current liabilities		15,573			18,338
Total liabilities		235,846			247,817
Commitments and contingencies (see Notes 19 and 20)
Stockholders' equity:
Common Stock, $.10 par value; authorized 100,000,000 issued 32,836,930 and 32,240,795 shares at respective dates		3,284			3,223
Additional paid-in capital		119,265			109,765
Retained earnings		188,481			131,178
Treasury stock, at cost, 1,738,624 and 1,757,530 shares at respective dates		(14,823	)		(14,984	)
Accumulated other comprehensive loss		(44,981	)		(18,962	)
Total stockholders' equity		251,226			210,220
Total liabilities and stockholders' equity	$	487,072		$	458,037

See accompanying notes to consolidated financial statements.

39

CAMBREX CORPORATION AND SUBSIDIARIES

CONSOLIDATED INCOME STATEMENTS

(dollars in thousands, except per share data)

	Years Ended December 31,
	2014			2013			2012
Gross Sales	$	374,150		$	317,212		$	277,931
Commissions, allowances and rebates		2,306			1,351			2,503
Net sales		371,844			315,861			275,428
Other revenues		2,769			2,315			1,073
Net revenues		374,613			318,176			276,501
Cost of goods sold		250,815			215,272			186,014
Gross profit		123,798			102,904			90,487
Selling, general and administrative expenses		52,489			47,568			45,248
Research and development expenses		13,075			10,387			9,544
Operating expenses		65,564			57,955			54,792
Loss on voluntary pension settlement		7,170			-			-
Gain on sale of asset		(1,234	)		(4,680	)		-
Operating profit		52,298			49,629			35,695
Other expenses/(income)
Interest expense, net		2,174			2,242			2,439
Equity in losses of partially-owned affiliates		4,623			2,262			1,766
Other (income)/expenses, net		(5	)		118			122
Income before income taxes		45,506			45,007			31,368
(Benefit)/provision for income taxes		(12,627	)		14,732			(31,861	)
Income from continuing operations		58,133			30,275			63,229
Loss from discontinued operations, net of tax		(830	)		(4,360	)		(926	)
Net income	$	57,303		$	25,915		$	62,303
Basic earnings per share
Income from continuing operations	$	1.89		$	1.00		$	2.13
Loss from discontinued operations, net of tax	$	(0.03	)	$	(0.14	)	$	(0.03	)
Net income	$	1.86		$	0.86		$	2.10
Diluted earnings per share
Income from continuing operations	$	1.84		$	0.98		$	2.09
Loss from discontinued operations, net of tax	$	(0.03	)	$	(0.14	)	$	(0.03	)
Net income	$	1.81		$	0.84		$	2.06
Weighted average shares outstanding:
Basic weighted average shares outstanding		30,763			30,150			29,703
Effect of dilutive stock based compensation		880			751			611
Diluted weighted average shares outstanding		31,643			30,901			30,314

See accompanying notes to consolidated financial statements.

40

CAMBREX CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(dollars in thousands)

	Years Ended December 31,
	2014			2013			2012
Net income	$	57,303		$	25,915		$	62,303
Foreign currency translation adjustments:
Unrealized net change arising during the period		(21,400	)		4,813			4,066
Foreign currency forward contracts:
Unrealized net loss		-			-			(51	)
Reclassification adjustments for gains included in net income		-			-			(329	)
Income taxes		-			-			110
Interest rate swap agreement:
Unrealized net losses		(152	)		(130	)		(1,253	)
Reclassification adjustments for losses included in net income		465			444			323
Income taxes		(109	)		(110	)		326
Pension plans:
Actuarial (loss)/gain
Actuarial (loss)/gain arising during the period		(18,338	)		13,651			(4,413	)
Amortization to net income of net actuarial loss		802			1,339			1,140
Prior service cost
Amortization to net income of net prior service cost		50			50			110
Lump-sum pension payout		7,170			-			-
Income taxes		5,493			(4,928	)		(2,533	)
Comprehensive income	$	31,284		$	41,044		$	59,799

See accompanying notes to consolidated financial statements.

41

CAMBREX CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(dollars in thousands, except per share data)

	Common Stock
	Shares Issued		Par Value ($.10)		Additional Paid-In Capital			Retained Earnings		Treasury Stock			Accumulated Other Comprehensive Loss			Total Stockholders' Equity
Balance at December 31, 2011		31,441,138	$	3,143	$	101,646		$	42,960	$	(15,821	)	$	(31,587	)	$	100,341
Net income									62,303								62,303
Other comprehensive loss														(2,504	)		(2,504	)
Exercise of stock options		263,092		26		1,329											1,355
Vested restricted stock						(604	)				604						-
Stock option expense						1,303											1,303
Restricted stock expense						446											446
Performance stock expense						53											53
Balance at December 31, 2012		31,704,230	$	3,169	$	104,173		$	105,263	$	(15,217	)	$	(34,091	)	$	163,297
Net income									25,915								25,915
Other comprehensive income.														15,129			15,129
Exercise of stock options		536,565		54		3,170											3,224
Vested restricted stock						(534	)				534						-
Stock option expense						1,994											1,994
Restricted stock expense						427											427
Performance stock expense						404											404
Share based compensation tax windfall						131											131
Repurchase of shares											(301	)					(301	)
Balance at December 31, 2013		32,240,795	$	3,223	$	109,765		$	131,178	$	(14,984	)	$	(18,962	)	$	210,220
Net income									57,303								57,303
Other comprehensive income														(26,019	)		(26,019	)
Exercise of stock options		596,135		61		4,142											4,203
Vested restricted stock						(161	)				161						-
Stock option expense						2,491											2,491
Restricted stock expense						395											395
Performance stock expense						2,116											2,116
Share based compensation tax windfall						517											517
Balance at December 31, 2014		32,836,930	$	3,284	$	119,265		$	188,481	$	(14,823	)	$	(44,981	)	$	251,226

See accompanying notes to consolidated financial statements.

42

CAMBREX CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(dollars in thousands)

	Years Ended December 31,
	2014			2013			2012
Cash flows from operating activities:
Net income	$	57,303		$	25,915		$	62,303
Adjustments to reconcile net income to cash flows:
Depreciation and amortization		23,826			22,473			21,775
Non-cash deferred revenue		(17,873	)		(10,093	)		(238	)
Loss on voluntary pension settlement		7,170			-			-
Increase in inventory reserve		5,343			2,329			2,790
Gain on sale of assets		(1,099	)		(4,281	)		(5	)
Allowance for doubtful accounts		61			433			193
Stock based compensation		5,002			2,825			1,802
Deferred income tax provision		(16,025	)		5,902			(40,712	)
Equity in losses of partially-owned affiliates		4,623			2,262			1,766
Other		523			348			348
Changes in assets and liabilities:
Trade receivables		(8,955	)		(27,707	)		(6,310	)
Inventories		(9,062	)		(19,328	)		(10,295	)
Prepaid expenses and other current assets		(5,766	)		(2,651	)		(188	)
Accounts payable and other current liabilities		12,369			10,107			3,134
Deferred revenue		11,773			18,644			10,748
Other non-current assets and liabilities		(2,387	)		11,229			182
Discontinued operations:
Net cash used in discontinued operations		(1,858	)		(1,533	)		(3,747	)
Net cash provided by operating activities		64,968			36,874			43,546
Cash flows from investing activities:
Capital expenditures		(23,323	)		(57,320	)		(18,156	)
Proceeds from sale of assets		2,355			2,378			16
Advances to partially-owned affiliates		(1,404	)		(1,655	)		(2,047	)
Acquisition of business and equity investment, net of cash acquired		(2,426	)		-			-
Other		-			-			5
Net cash used in investing activities		(24,798	)		(56,597	)		(20,182	)
Cash flows from financing activities:
Long-term debt activity (including current portion):
Borrowings		25,750			70,950			5,500
Repayments		(45,000	)		(55,700	)		(39,500	)
Proceeds from stock options exercised		4,203			3,224			1,355
Other		522			(301	)		(22	)
Net cash (used in)/provided by financing activities		(14,525	)		18,173			(32,667	)
Effect of exchange rate changes on cash and cash equivalents		(2,872	)		744			933
Net increase/(decrease) in cash and cash equivalents		22,773			(806	)		(8,370	)
Cash and cash equivalents at beginning of year		22,745			23,551			31,921
Cash and cash equivalents at end of year	$	45,518		$	22,745		$	23,551
Supplemental disclosure:
Interest paid, net of capitalized interest	$	2,068		$	2,325		$	2,556
Income taxes paid, net of refunds received	$	6,725		$	7,211		$	5,068

See accompanying notes to consolidated financial statements.

43

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(1) The Company

Cambrex Corporation and Subsidiaries (the “Company” or “Cambrex”) primarily provides products and services worldwide to pharmaceutical companies and generic drug companies.  The Company is dedicated to accelerating its customers’ drug discovery, development and manufacturing processes for human therapeutics.  The Company’s products consist of active pharmaceutical ingredients (“APIs”) and pharmaceutical intermediates produced under Food and Drug Administration current Good Manufacturing Practices for use in the production of prescription and over-the-counter drug products.  Cambrex has three operating segments, which are manufacturing facilities that have been aggregated as one reportable segment.  A fourth facility is immaterial.

(2) Summary of Significant Accounting Policies

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries.  Equity investments in which the Company exercises significant influence but does not control, are accounted for using the equity method.  The Company’s share of its equity method investees’ earnings or losses are included in “Other expenses/(income)” in the income statements. The Company eliminates its pro rata share of gross profit on sales with its equity method investees for assets still remaining in inventory at the end of the reporting period.  All other significant intercompany balances and transactions have been eliminated in consolidation.

Cash Equivalents

Temporary cash investments with an original maturity of less than three months are considered cash equivalents.  The carrying amounts approximate fair value.

Allowance for Doubtful Accounts

The Company maintains allowances for doubtful accounts relating to estimated losses resulting from customers being unable to make required payments.  Allowances for doubtful accounts are based on historical experience and known factors regarding specific customers and the industries in which those customers operate.  If the financial condition of the Company’s customers were to deteriorate, resulting in their inability to make payments, additional allowances would be required.

Concentrations of credit risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents and accounts receivable. In the normal course of business, the Company maintains cash balances with European Union banks ranging from the equivalent of $1,000 - $10,000. The Company routinely monitors the risks associated with these institutions and diversifies its exposure by maintaining smaller balances with multiple financial institutions.  Concentrations of credit risk with respect to accounts receivable are limited due to the Company's large number of customers and their dispersion throughout the world. At December 31, 2014 and 2013, the Company had receivables with one customer totaling nearly 38% of overall accounts receivables. The Company does not consider this customer to pose any significant credit risk.

Derivative Instruments

Derivative financial instruments are periodically used by the Company primarily to mitigate a variety of working capital, investment and borrowing risks.  The Company primarily uses foreign currency forward contracts to minimize foreign currency exchange rate risk associated with foreign currency transactions.  Changes in the fair value on these forward contracts are recognized in earnings.  The Company uses interest rate swap instruments only as hedges.  As such, the differential to be paid or received in connection with these instruments is accrued and recognized in income as an adjustment to interest expense.

44

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(2) Summary of Significant Accounting Policies (continued)

None of the foreign currency forward contracts entered into during 2014 were designated for hedge accounting treatment. There were no foreign currency forward contracts entered into or outstanding in 2013.

Inventories

Inventories are stated at the lower of cost, determined on a first‑in, first‑out basis, or market.  The determination of market value involves assessment of numerous factors, including estimated selling prices.  Reserves are recorded to reduce the carrying value for inventory determined to be damaged, obsolete or otherwise unsaleable.

Property, Plant and Equipment

Property, plant and equipment is stated at cost, net of accumulated depreciation.  Plant and equipment are depreciated on a straight‑line basis over the estimated useful lives for each applicable asset group as follows:

Buildings and improvements	20 to 30 years, or term of lease if applicable
Machinery and equipment	7 to 15 years
Furniture and fixtures	5 to 7 years
Computer hardware and software	3 to 7 years

Expenditures for additions, major renewals or betterments are capitalized and expenditures for maintenance and repairs are charged to income as incurred.

When assets are retired or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts, and any resulting gain or loss is reflected in costs of goods sold or operating expenses.  Interest is capitalized in connection with the construction and acquisition of assets that are capitalized over longer periods of time for larger amounts.  The capitalized interest is recorded as part of the cost of the asset to which it relates and is amortized over the asset’s estimated useful life.  Total interest capitalized in connection with ongoing construction activities was $128 in 2014, $298 in 2013 and negligible in 2012.

Impairment of Goodwill

The Company reviews the carrying value of goodwill to determine whether impairment may exist on an annual basis or whenever it has reason to believe goodwill may not be recoverable.  The annual impairment test of goodwill is performed during the fourth quarter of each fiscal year. The Company did not have an impairment for any of the years presented.

Goodwill impairment is determined by the Company using a two-step process.  The first step of the goodwill impairment test is used to identify potential impairment by comparing the fair value of each reporting unit, determined using various valuation techniques, with the primary technique being a discounted cash flow analysis, to its carrying value.  If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired and the second step of the impairment test is unnecessary.  If the carrying amount of a reporting unit exceeds its fair value, the second step of the goodwill impairment test is performed to measure the amount of impairment loss, if any.  The second step of the goodwill impairment test compares the implied fair value of the reporting unit’s goodwill with the carrying amount of that goodwill.  If the carrying amount of the reporting unit’s goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized.

45

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(2) Summary of Significant Accounting Policies (continued)

Based upon the Company’s  most recent analysis, with the exception of Zenara, the fair value of all other reporting units substantially exceeded their carrying values. Zenara, which was acquired during 2014, has an estimated fair value that closely approximates the carrying value.  The goodwill of Zenara was $9,715.  The Zenara business, based in India, has been in operation for a relatively short period of time compared to Cambrex’s other businesses, and competes with other low cost providers globally.  Cambrex’s current assumptions and those used at acquisition include adding a significant amount of new and profitable customers by utilizing Cambrex’s global sales force as well as making operational improvements to the business.  The business has few customers and is expected to operate at or slightly below breakeven in 2015.  Any negative changes in assumptions on new customers, volumes, or Cambrex’s ability to improve operations while maintaining a competitive cost structure could adversely affect the fair value of Zenara and result in significant goodwill or other long-lived asset impairment charges in 2015 or later.

Impairment of Long-Lived Assets

The Company assesses the impairment of its long-lived assets, including amortizable intangible assets, and property, plant and equipment, whenever economic events or changes in circumstances indicate that the carrying amounts of the assets may not be recoverable.  Long lived assets are considered to be impaired when the sum of the undiscounted expected future operating cash flows is less than the carrying amounts of the related assets.  If impaired, the assets are written down to fair market value.

The Company has investments in partially-owned affiliates.  It does not separately test an investee’s underlying assets for impairments but will recognize its share of any impairment charge recorded by an investee in earnings and consider the effect of the impairment on its investment.  A series of operating losses of an investee or other factors may indicate that a decrease in value of the investment has occurred that is other than temporary. A loss in value of an investment that is other than a temporary decline would be recognized as an impairment if the fair value of that investment is less than its carrying amount.

Revenue Recognition

Revenues are generally recognized when title to products and risk of loss are transferred to customers.  Additional conditions for recognition of revenue are that collection of sales proceeds is reasonably assured and the Company has no further performance obligations.

Amounts billed in advance are recorded as deferred revenue on the balance sheet. Since payments received are sometimes non-refundable, the termination of a contract by a customer prior to its completion could result in an immediate recognition of deferred revenue relating to payments already received but not previously recognized as revenue.

Sales terms to certain customers include rebates if certain conditions are met.  Additionally, sales are generally made with a limited right of return under certain conditions.  The Company estimates these rebates and returns at the time of sale based on the terms of agreements with customers and historical experience and recognizes revenue net of these estimated costs which are classified as allowances and rebates.

The Company bills a portion of freight cost incurred on shipments to customers.  Amounts billed to customers are recorded within net revenues.  Freight costs are reflected in cost of goods sold.

46

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(2) Summary of Significant Accounting Policies (continued)

Income Taxes

The Company and its eligible subsidiaries file a consolidated U.S. income tax return.  Foreign subsidiaries are consolidated for financial reporting but are not eligible to be included in the consolidated U.S. income tax return, however the earnings of foreign subsidiaries are generally taxed by the U.S. when repatriated and such U.S. tax may be reduced or eliminated by federal foreign tax credits based on the foreign income and withholding taxes paid or accrued by the foreign subsidiary.  Historically, the Company intended to reinvest foreign earnings indefinitely outside of the U.S. and only considered repatriating excess cash from foreign subsidiaries if it could utilize fully valued domestic tax attributes to completely offset any tax expense that would otherwise result.  Unrecognized foreign tax credits and fully valued foreign tax credit carryovers were available to offset any potential U.S. tax liability.  Therefore, the Company had not provided U.S. federal income taxes or foreign withholding taxes on its undistributed earnings from foreign operations prior to 2012.  During the fourth quarter of 2012, the Company completed a detailed forecast of foreign source income by jurisdiction as part of the ongoing process to evaluate its valuation allowance against deferred tax assets.  As part of this process, as well as a continuing desire to limit its credit and currency exposure for cash held in foreign currencies or in non-U.S. banks, the Company determined that it is likely that a portion of the undistributed earnings of its foreign subsidiaries will be repatriated to the U.S. in the future. Accordingly, in 2012 the Company changed its indefinite reinvestment assertion and now provides deferred taxes on certain undistributed foreign earnings.  Subject to limitations, U.S. income tax on such foreign earnings, when actually repatriated, may be reduced or eliminated by unrecognized foreign tax credits that may be generated in connection with the repatriation or by existing foreign tax credit carryforwards or other tax attributes for which valuation allowance was released.  The Company monitors available evidence and its plans for foreign earnings and expects to continue to provide deferred taxes based on the tax liability that would be due upon repatriation of amounts not considered permanently reinvested.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

Environmental Costs

The Company is subject to extensive and changing federal, state, local and foreign environmental laws and regulations, and has made provisions for the estimated financial impact of environmental activities.  The Company’s policy is to accrue environmental related costs of a non-capital nature, including estimated litigation costs, when those costs are believed to be probable and can be reasonably estimated.  The quantification of environmental exposures requires an assessment of many factors, including changing laws and regulations, advancements in environmental technologies, the quality of information available related to specific sites, the assessment stage of each site investigation, preliminary findings and the length of time involved in remediation or settlement.  Such accruals are adjusted as further information develops or circumstances change.  For certain matters, the Company expects to share costs with other parties.  Recoveries of environmental remediation costs from other parties are recorded as assets when their receipt is deemed certain.

47

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(2) Summary of Significant Accounting Policies (continued)

Foreign Currency

The functional currency of the Company's foreign subsidiaries is the applicable local currency.  The translation of the applicable foreign currencies into U.S. dollars is performed for balance sheet accounts using current exchange rates in effect at the balance sheet date and for revenue and expense accounts and cash flows using average rates of exchange prevailing during the year.  Adjustments resulting from the translation of foreign currency financial statements are accumulated in stockholders' equity until the entity is sold or substantially liquidated.  Gains or losses relating to transactions of a long-term investment nature are also accumulated in stockholders' equity.  Gains or losses resulting from third-party foreign currency transactions are included in the income statement as a component of other revenues in the consolidated income statement.  Foreign currency net transaction gains/(losses) were $186, ($133) and ($274) in 2014, 2013 and 2012, respectively.

Earnings per Common Share

All diluted earnings per share are computed on the basis of the weighted average shares of common stock outstanding plus common equivalent shares arising from the effect of dilutive stock options, equity-settled performance shares and restricted stock units, using the treasury stock method.

For the years ended December 31, 2014, 2013 and 2012, shares of 940,038, 916,350, and 580,745, respectively, were not included in the calculation of diluted shares outstanding because the effect would be anti-dilutive.

Comprehensive Income

Included within accumulated other comprehensive income for the Company are foreign currency translation adjustments, changes in the fair value related to derivative instruments classified as cash flow hedges, net of related tax, and changes in the pensions, net of tax.  Total comprehensive income/loss for the years ended December 31, 2014 and 2013 are included in the Statements of Comprehensive Income.

The components of accumulated other comprehensive loss in stockholders’ equity are as follows:

	2014			2013
Foreign currency translation	$	(11,410	)	$	9,990
Unrealized loss on hedging contracts, net of tax		(193	)		(396	)
Pensions, net of tax		(33,378	)		(28,556	)
Total	$	(44,981	)	$	(18,962	)

(3) Impact of Recently Issued Accounting Pronouncements

Revenue from Contracts with Customers

In May 2014, the FASB issued ASU 2014-09 that introduces a new five-step revenue recognition model in which an entity should recognize revenue to depict the transfer of promised 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. This ASU also requires disclosures sufficient to enable users to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers, including qualitative and quantitative disclosures about contracts with customers, significant judgments and changes in judgments, and assets recognized from the costs to obtain or fulfill a contract. This standard is effective for fiscal years beginning after December 15, 2016, including interim periods within that reporting period. The Company is currently evaluating the new guidance to determine the impact, if any, it will have on its consolidated financial statements.

48

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(3) Impact of Recently Issued Accounting Pronouncements (continued)

Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity

In April 2014, the FASB issued ASU 2014-08, which includes amendments that change the requirements for reporting discontinued operations and require additional disclosures about discontinued operations. Under the new guidance, only disposals representing a strategic shift in operations - that is, a major effect on the organization's operations and financial results should be presented as discontinued operations. Additionally, the ASU requires expanded disclosures about discontinued operations that will provide financial statement users with more information about the assets, liabilities, income and expenses of discontinued operations. This update is effective in the first quarter of 2015. This pronouncement will not have an impact on the Company’s financial position or results of operations.

(4) Acquisitions

In May 2014, the Company purchased the remaining 49% interest in the stock of Zenara.  The Company negotiated an accelerated purchase of the business, which was contractually required to be completed in 2016 at a price that would have been determined by the financial performance of the Zenara business.  The purchase price negotiated for the 49% was $2,680.  Management believed it was economically beneficial to take control of the business to accelerate the execution of the Company’s strategy for the business.  The Company recorded $655 for the identifiable net liabilities of Zenara at fair market value, intangible assets of $4,900, a deferred tax liability related to the intangible asset of $1,666 and goodwill of $9,715.   The Company incurred acquisition related costs of $460 for the year ended December 31, 2014. These costs were expensed and included in “Selling, general and administrative expenses” in the Company’s income statement. Proforma financial information is not required as this acquisition  is not material. Refer to Note 8 for further disclosure.

(5) Net Inventories

Inventories are stated at the lower of cost, determined on a first-in, first-out basis, or market.

Net inventories consist of the following:

	December 31,
	2014		2013
Finished goods	$	24,200	$	29,797
Work in process		27,640		31,990
Raw materials		28,558		22,580
Supplies		5,232		5,598
Total	$	85,630	$	89,965

The components of inventory stated above are net of reserves of $12,878 and $11,496 as of December 31, 2014 and 2013, respectively.

49

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(6) Property, Plant and Equipment

Property, plant and equipment consist of the following:

	December 31,
	2014			2013
Land	$	4,117		$	4,312
Buildings and improvements		103,083			108,460
Machinery and equipment		365,623			398,490
Furniture and fixtures		1,821			1,884
Construction in progress		20,085			16,808
Total		494,729			529,954
Accumulated depreciation		(331,162	)		(357,988	)
Net	$	163,567		$	171,966

Depreciation expense was $23,296, $22,218 and $21,528 for the years ended December 31, 2014, 2013 and 2012, respectively.  Total capital expenditures in 2014 and 2013 were $29,898 and $41,600, respectively.

(7) Goodwill and Intangible Assets

The changes in the carrying amount of goodwill for the years ended December 31, 2014 and 2013 are as follows:

Balance as of December 31, 2012	$	37,312
Translation effect		1,358
Balance as of December 31, 2013		38,670
Acquisition of business		9,715
Translation effect		(4,473	)
Balance as of December 31, 2014	$	43,912

Acquired intangible assets, which are amortized, consist of the following:

		As of December 31, 2014
	Amortization Period	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Technology-based intangibles	10 - 20 years	$	8,228	$	(1,141	)	$	7,087
Internal-use software	7 years		1,332		-			1,332
Customer-related intangibles	10 - 15 years		716		(233	)		483
		$	10,276	$	(1,374	)	$	8,902

50

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(7) Goodwill and Intangible Assets (continued)

		As of December 31, 2013
	Amortization Period	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Technology-based intangibles	20 years	$	4,192	$	(786	)	$	3,406
Customer-related intangibles	10 - 15 years		814		(209	)		605
		$	5,006	$	(995	)	$	4,011

The change in the gross carrying amount is related to the acquisition of the remaining 49% of Zenara and the impact of foreign currency translation.  The acquisition resulted in the recognition of technology- based intangibles of $4,900 in the second quarter of 2014. During 2014, the Company began implementing a new enterprise resource planning system, as such, $1,332 has been capitalized and classified as internal-use software.

Amortization expense amounted to $530, $255 and $247 for the years ended December 31, 2014, 2013 and 2012, respectively.

Amortization expense related to current intangible assets is expected to be approximately $757 for 2015 and $884 for each of the next four years.

(8) Partially-Owned Affiliates

In May 2014, the Company negotiated an accelerated purchase of Zenara, which was contractually required to be completed in 2016 at a price that would have been determined by the financial performance of the business. The purchase price negotiated for the remaining 49% was $2,680.  Management believed it was economically beneficial to take control of the business to accelerate the execution of the Company’s strategy for the business. The Company incurred acquisition related costs of $460 for the year ended December 31, 2014.

The Company was required to perform a fair market value assessment immediately before acquisition of its existing 51% ownership interest.  This resulted in the recognition of a gain of $278 using a discounted cash flow model with inputs developed by Company management.  The Company also recorded an expense of $4,400 representing the release of foreign currency translation adjustments previously recorded in “Other comprehensive income” that are now required to be recorded to the income statement as a result of the removal of the investment in partially-owned affiliate due to the full consolidation of Zenara as of the acquisition date.  The net amount of these items totaled a loss of $4,122 and is recorded in “Equity in losses of partially-owned affiliates” on the Company’s income statement.

The Company recorded a loss of $458 related to Zenara and reflects activity through the date the remaining 49% was purchased.  This amount includes amortization expense of $333. The impact of its partial ownership stake in Zenara was a loss of $1,956 and $1,976 in 2013 and 2012, respectively, and is located within “Other expenses/(income)” as “Equity in losses of partially-owned affiliates” on the Company’s income statement.  These amounts include amortization expense of $882 and $965 in 2013 and 2012, respectively, and depreciation expense of $130 and $132 in 2013 and 2012, respectively.  During 2014 the Company advanced $1,282 to Zenara through the purchase date.  The Company advanced $1,514 and $1,594 to Zenara in 2013 and 2012, respectively.

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CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(8) Partially-Owned Affiliates (continued)

The Company’s financial statements reflect its share of Zenara’s results through the date the Company purchased the remaining 49% interest at which time Zenara became a wholly-owned subsidiary of the Company and included in the consolidated financial statements.  Partially-owned affiliates also includes two smaller joint ventures located in Europe and Brazil.   Investments in and advances to partially-owned affiliates were not material to the Company’s consolidated financial statements as of December 31, 2014.

(9) Accrued Expense and Other Current Liabilities

The components of accrued expenses and other current liabilities are as follows:

	December 31,
	2014		2013
Salaries and employee benefits payable	$	26,893	$	26,211
Taxes payable and related reserves		5,420		10,168
Other		8,701		11,719
Total	$	41,014	$	48,098

(10) Income Taxes

Income before income taxes consists of the following:

	December 31,
	2014		2013		2012
Domestic	$	37,211	$	23,068	$	13,525
International		8,295		21,939		17,843
Total	$	45,506	$	45,007	$	31,368

52

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(10) Income Taxes (continued)

The provision for income taxes consist of the following provisions/(benefits):

	December 31,
	2014			2013		2012
Current:
Federal	$	2,572		$	630	$	(177	)
State		-			15		4
International		512			5,980		8,525
		3,084			6,625		8,352
Deferred:
Federal	$	(14,965	)	$	7,014	$	(36,287	)
International		(746	)		1,093		(3,926	)
		(15,711	)		8,107		(40,213	)
Total	$	(12,627	)	$	14,732	$	(31,861	)

The (benefit)/provision for income taxes differs from the statutory federal income tax rate of 35% for 2014, 2013 and 2012 as follows:

	December 31,
	2014			2013			2012
Income tax provision at U.S federal statutory rate	$	15,927		$	15,752		$	10,979
Effect of foreign income taxed at rates other than the U.S. federal statutory rate		751			242			(451	)
Foreign income inclusions		2,742			-			4,563
Tax credits		(2,692	)		(250	)		(177	)
Changes in tax laws		-			(1,155	)		(1,329	)
Tax audit settlements		(3,948	)		-			-
Net change in valuation allowance		(26,543	)		(97	)		(45,105	)
Permanent items and other		1,136			240			(341	)
Total	$	(12,627	)	$	14,732		$	(31,861	)

Foreign income inclusions represent distributions from foreign subsidiaries which give rise to newly recognized foreign tax credits.  In 2012, the Company utilized fully valued foreign tax credits, alternative minimum tax credits, and research and experimentation tax credits, prior to the release of the domestic valuation allowance, to completely offset any tax impact of the foreign income inclusions.  Tax audit settlements in 2014 include the final settlement of the European tax dispute that arose in 2009.  Net change in the valuation allowance in 2014 includes the benefit of $26,902 for the remaining release of the domestic valuation allowance attributable to foreign tax credits, offset by $142 for state deferred taxes and $217 for foreign deferred taxes subject to valuation allowances.  Net change in the valuation allowance in 2012 includes the benefit of $36,287 for the partial release of the domestic valuation allowance, the reduction in the domestic valuation allowance, prior to the release, for the utilization of fully valued tax credits to offset U.S. income tax and deferred tax amounts of $8,660, and the reduction in the foreign valuation allowance of $158.

53

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(10) Income Taxes (continued)

The components of deferred tax assets and liabilities as of December 31, 2014 and 2013 relate to temporary differences and carryforwards as follows:

	December 31,
	2014			2013
Deferred tax assets:
Inventory	$	3,313		$	2,510
Foreign tax credit carryforwards		19,925			31,463
Environmental		2,993			2,995
Net operating loss carryforwards (foreign)		3,381			944
Employee benefits		18,879			12,841
Research & experimentation tax credit carryforwards		480			1,900
Alternative minimum tax credit carryforwards		2,773			2,773
Property, plant and equipment		3,898			3,843
Other		5,605			4,037
Total gross deferred tax assets		61,247			63,306
Valuation allowance		(5,053	)		(29,890	)
Total deferred tax assets	$	56,194		$	33,416
Deferred tax liabilities:
Property, plant and equipment		(9,649	)		(9,059	)
Intangibles and other		(10,487	)		(9,856	)
Unremitted foreign earnings		(726	)		(568	)
Foreign tax allocation reserve		(1,856	)		(2,006	)
Other		(1,978	)		(2,187	)
Total deferred tax liabilities	$	(24,696	)	$	(23,676	)
Net deferred tax asset	$	31,498		$	9,740
Classified as follows in the consolidated balance sheet:
Current deferred tax asset (included in other current assets)		3,808			2,874
Non-current deferred tax asset		38,424			19,799
Current deferred tax liability (included in other current liabilities)		(189	)		(98	)
Non-current deferred tax liability		(10,545	)		(12,835	)
	$	31,498		$	9,740

The Company establishes a valuation allowance against deferred tax assets when it is more likely than not that the Company will be unable to realize those deferred tax assets in the future. In 2003, the Company’s assessment of the need for a valuation allowance against domestic deferred tax assets considered current and past performance, cumulative losses in recent years from domestic operations, and a shift in the geographic mix of forecasted income.  Considering the pattern of then-recent domestic losses, the Company gave significant weight to projections showing future domestic losses for purposes of assessing the need for a valuation allowance.  This assessment resulted in a determination that it was more likely than not that domestic deferred tax assets would not be realized, and as such, a valuation allowance against net domestic deferred tax assets was recorded.

54

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(10) Income Taxes (continued)

A sustained period of domestic profitability along with expectations of future domestic profitability of sufficient amounts and character was required before the Company concluded that it was more likely than not that the domestic deferred tax assets would be realized, and as such, that there was no longer the need for a full valuation allowance against net domestic deferred tax assets. During 2012, the Company concluded that its three-year cumulative domestic profitability through the end of 2012 and expectations of future domestic profitability warranted the reversal of all of the domestic valuation allowance attributable to net federal temporary differences, alternative minimum tax credits, and research and experimentation tax credits.  Additionally, the Company released a portion of the domestic valuation allowance attributable to federal foreign tax credits.  These valuation allowance releases resulted in a tax benefit to continuing operations of $36,287 in 2012.

During 2014, the Company received updated customer projections that impact current and future years’ U.S. taxable income in amounts and type that support the utilization of federal foreign tax credits.  For the first nine months of 2014, the expected impact in the current year and future years of these updated projections resulted in the Company releasing $15,183 of valuation allowance against foreign tax credits.  Additional updates of customer projections received by the Company during the fourth quarter of 2014 resulted in the release of the remaining valuation allowance against foreign tax credits of $11,719.  The Company currently expects to maintain a domestic valuation allowance against state tax credits and deferred tax assets due to restrictive rules regarding realization.  The Company expects to maintain a valuation allowance against certain foreign tax assets, primarily NOL carryforwards, until such time as the Company attains an appropriate level of future profitability in the appropriate jurisdictions and is able to conclude that it is more likely than not that its foreign deferred tax assets are realizable.

The domestic valuation allowance for the years ended December 31, 2014, 2013 and 2012 decreased $26,760, $3 and $47,490, respectively. The 2014 decrease in the domestic valuation allowance was allocated as follows: the valuation allowance decreased $26,902 for the release of valuation allowance due to domestic profitability and increased $142 due to domestic state items.  The 2013 decrease in the domestic valuation allowance is due to domestic state items.  The 2012 decrease in the domestic valuation allowance was allocated as follows: the valuation allowance decreased $36,287 for the release of valuation allowance due to domestic profitability, decreased by a net amount of $8,660 for domestic income and deferred tax amounts in continuing operations prior to the release of valuation allowance in the fourth quarter of 2012, and decreased by a net amount of $2,543 for domestic gains and losses included in OCI and discontinued operations.

The foreign valuation allowance for the years ended December 31, 2014, 2013 and 2012 increased $1,923, decreased $48, and decreased $140, respectively.  The 2014 increase in the foreign valuation allowance was allocated as follows: the valuation allowance increased $217 for foreign income and increased $1,706 for deferred tax amounts and currency translation adjustments included in OCI. The 2013 decrease in the foreign valuation allowance was allocated as follows: the valuation allowance decreased $94 for foreign income and increased $46 for deferred tax amounts and currency translation adjustments included in OCI.  The 2012 decrease in the foreign valuation allowance was allocated as follows: the valuation allowance decreased $158 for foreign income and increased $18 for deferred tax amounts and currency translation adjustments included in OCI.

Under the tax laws of the various jurisdictions in which the Company operates, NOLs may be carried forward or back, subject to statutory limitations, to reduce taxable income in future or prior years.  Foreign NOLs are approximately $11,323, of which $8,778 are attributable to NOLs acquired during 2014. NOLs in most foreign jurisdictions will carry forward indefinitely.

As of December 31, 2014, $19,925 of domestic federal foreign tax credits, $480 of research and experimentation tax credits and $2,773 of alternative minimum tax credits are available as credits against future U.S. income taxes on worldwide income, subject to certain limitations. Under U.S. tax laws, these will expire in 2015 through 2018, 2033 through 2034, and the alternative minimum tax credit carryforwards have no expiration date, respectively.

55

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(10) Income Taxes (continued)

In 2014 and 2012, the Company repatriated $5,442 and $8,953, respectively, of cash from its foreign subsidiaries in order to reduce its credit and currency exposure for cash held in foreign currencies or in non-U.S. banks and utilized the excess cash for debt reduction.  The Company utilized fully valued domestic tax credits in 2012 to completely offset any tax impact of the foreign income inclusion.  Historically, the Company intended to reinvest foreign earnings indefinitely outside of the U.S. and only considered repatriating excess cash from foreign subsidiaries if it could utilize fully valued domestic tax attributes to completely offset any tax expense that would otherwise result. Unrecognized foreign tax credits and fully valued foreign tax credit carryovers had been available to offset any potential U.S. tax liability.  Therefore, the Company had not provided U.S. federal or state income taxes or foreign withholding taxes on its undistributed earnings from foreign operations prior to 2012.  During the fourth quarter of 2012 the Company completed a detailed forecast of foreign source income by jurisdiction as part of the ongoing process to evaluate its valuation allowance against deferred tax assets.  As part of this process, as well as a continuing desire to limit its credit and currency exposure related to cash held in foreign currencies or in non-U.S. banks, the Company determined that it is likely that a portion of the undistributed earnings of its foreign subsidiaries will be repatriated to the U.S. in the future.  Accordingly, in 2012 the Company changed its indefinite reinvestment assertion.  The Company has provided a deferred tax liability of $726 on certain undistributed foreign earnings as of December 31, 2014. Subject to limitations, U.S. income tax on such foreign earnings, when actually repatriated, may be reduced or eliminated by unrecognized foreign tax credits that may be generated in connection with the repatriation or by existing foreign tax credit carryforwards or other tax attributes for which a valuation allowance was released in 2012 and 2014.  The Company monitors available evidence and its plans for foreign earnings and expects to continue to provide deferred taxes based on the tax liability that would be due upon repatriation of amounts not considered permanently reinvested.

The following table summarizes the activity related to the Company’s unrecognized tax benefits as of December 31, 2014, 2013 and 2012:

	2014			2013			2012
Balance at January 1	$	3,922		$	3,967		$	4,328
Gross increases related to current period tax positions		275			257			348
Gross decreases related to prior period tax positions		(1,149	)		(427	)		(483	)
Expirations of statute of limitations for the assessment of taxes		(106	)		(37	)		(113	)
Settlements		(1,113	)		-			(175	)
Foreign currency translation		(186	)		162			62
Balance at December 31	$	1,643		$	3,922		$	3,967

Of the total balance of unrecognized tax benefits at December 31, 2014, $1,643, if recognized, would affect the effective tax rate.

Gross interest and penalties at December 31, 2014, 2013 and 2012 of $489, $5,005 and $4,511, respectively, related to the above unrecognized tax benefits are not reflected in the table above.  In 2014, 2013 and 2012, the Company accrued $337, $219 and $985, respectively, of interest and penalties in the income statement.  Consistent with prior periods, the Company recognizes interest and penalties within its income tax provision.

Tax years 2011 and forward in the U.S. are open to examination by the IRS.  The Company is also subject to examinations in its non-U.S. jurisdictions for 2009 and later years.

56

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(10) Income Taxes (continued)

The Company is also subject to audits in various states for various years in which it has filed income tax returns.  Previous state audits have resulted in immaterial adjustments.  In the majority of states where the Company files, the Company is subject to examination for tax years 2010 and forward.

In 2009, a subsidiary of the Company was examined by a European tax authority, which challenged the business purpose of the deductibility of certain intercompany transactions from 2003 and issued formal assessments against the subsidiary.  The Company had several favorable rulings in the courts on this matter, although the rulings were appealed by the tax authority.  At the same time, considering the hazards of litigation, the Company pursued settlement negotiations.  During the fourth quarter of 2014, the Company entered into a final settlement with the tax authority in order to avoid further litigation, without any admission of fault or breach of law.  The settlement required the Company to pay $1,487 in tax and interest during the fourth quarter of 2014 in full satisfaction of all liabilities for this matter, and in response the tax authority withdrew all pending litigation and renounced any outstanding claims.  The settlement did not impose any penalties on the Company. Therefore, in the fourth quarter of 2014, the Company decreased its remaining reserve for unrecognized tax benefits for this matter by $4,137.

In the next twelve months, the Company may increase its reserve for unrecognized tax benefits for intercompany transactions and acquired tax attributes by approximately $250.  This could affect the effective tax rate.

(11) Long‑term Debt

In November 2011, the Company entered into a $250,000 five-year Syndicated Senior Revolving Credit Facility (“Credit Facility”) which expires in November 2016.  The Company pays interest on this Credit Facility at LIBOR plus 1.50% - 2.10% based upon certain financial measurements.  The Credit Facility also includes financial covenants regarding interest coverage and leverage ratios.  The Company was in compliance with all financial covenants at December 31, 2014.   As of December 31, 2014, there was $60,000 outstanding on the Credit Facility.  As of December 31, 2013, there was $79,250 outstanding on the Credit Facility.  The 2014 and 2013 weighted average interest rate for long-term bank debt was 2.4% and 2.3%, respectively.

(12) Derivatives and Hedging Activities

The Company operates internationally and is exposed to fluctuations in foreign exchange rates and interest rates in the normal course of business.  The Company, from time to time, uses derivatives to reduce exposure to market risks resulting from fluctuations in interest rates and foreign exchange rates.

All financial instruments involve market and credit risks.  The Company is exposed to credit losses in the event of non-performance by the counterparties to the contracts.  While there can be no assurance, the Company does not anticipate non-performance by these counterparties.

Foreign Currency Forward Contracts

The Company periodically enters into foreign currency forward contracts to protect against currency fluctuations of forecasted cash flows and existing balance sheet exposures at its foreign operations, as deemed appropriate.  The Company may or may not elect to designate certain forward contracts for hedge accounting treatment.

For derivatives that are not designated for hedge accounting treatment, changes in the fair value are immediately recognized in earnings. This treatment has the potential to increase volatility of the Company’s earnings.

57

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(12) Derivatives and Hedging Activities (continued)

None of the foreign currency forward contracts entered into during 2014 were designated for hedge accounting treatment.  The notional amounts of the Company’s foreign exchange forward contracts were $3,632 at December 31, 2014.  There were no foreign currency forward contracts outstanding at December 31, 2013 and 2012. The Company does not hold or purchase any foreign currency forward contracts for trading or speculative purposes and no contractual term is greater than twelve months.

The fair value of the Company’s foreign exchange forward contracts was a loss of $102 at December 31, 2014 and is recorded in “Accrued expenses and other current liabilities” and “Other revenue.”

Interest Rate Swap

The Company entered into an interest rate swap in March 2012 to reduce the impact of changes in interest rates on its floating rate debt through September 2015.  The swap is a contract to exchange floating rate for fixed interest payments periodically over the life of the agreement without the exchange of the underlying notional debt amount.

The swap contract outstanding at December 31, 2014 has been designated as a cash flow hedge and, accordingly, changes in the fair value of this derivative are not recorded in earnings but are recorded each period in AOCI and reclassified into earnings as interest expense in the same period during which the hedged transaction affects earnings.  The ineffective portion of all hedges is recognized in earnings and has been immaterial to the Company's financial results.

As of December 31, 2014, the interest rate swap had a notional value of $60,000, at a fixed rate of 0.92%.  The fair value of this swap is based on quoted market prices and was in a loss position of $304, $616 and $930 at December 31, 2014, 2013 and 2012, respectively.  This loss is reflected in the Company’s balance sheet under the caption “Accrued expenses and other current liabilities.”

Assuming current market conditions continue, the entire loss will be reclassed out of AOCI into earnings within the next twelve months.

Refer to Note 13 to the Company’s consolidated financial statements for the summary table containing the fair value of the Company’s financial instruments.

(13) Fair Value Measurements

U.S. GAAP establishes a valuation hierarchy for disclosure of the inputs to the valuations used to measure fair value. This hierarchy prioritizes the inputs into three broad levels as follows: Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities; Level 2 inputs are quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets in markets that are not active, inputs other than quoted prices that are observable for the asset or liability, including interest rates, yield curves and credit risks, or inputs that are derived principally from, or corroborated by, observable market data through correlation; Level 3 inputs are unobservable inputs based on the Company’s assumptions used to measure assets and liabilities at fair value. A financial asset or liability’s classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement.

58

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(13) Fair Value Measurements (continued)

The following tables provide the assets and liabilities carried at fair value, measured on a recurring basis, as of December 31, 2014 and 2013:

				Fair Value Measurements at December 31, 2014 using:
Description	Total			Level 1		Level 2			Level 3
Foreign currency forwards, liabilities	$	(102	)	$	-	$	(102	)	$	-
Interest rate swap, liabilities		(304	)		-		(304	)		-
Total	$	(406	)	$	-	$	(406	)	$	-
				Fair Value Measurements at December 31, 2013 using:
Description	Total			(Level 1)		(Level 2)			(Level 3)
Interest rate swap, liabilities	$	(616	)	$	-	$	(616	)	$	-
Total	$	(616	)	$	-	$	(616	)	$	-

The fair value of the interest rate swap is estimated based on the present value of the difference between expected cash flows calculated at the contracted interest rate and the expected cash flows at current market interest rates using observable benchmarks for the LIBOR forward rates at the end of the period. The Company’s credit risk and its counterparties’ credit risks are also evaluated to estimate fair value.

The Company’s foreign currency forward contracts are measured at fair value using observable market inputs such as forward rates, the Company’s credit risk and its counterparties’ credit risks. Based on the Company’s continued ability to enter into forward contracts, the Company considers the markets for its fair value instruments to be active.

Based on these inputs, the Company’s interest rate swap and foreign currency forward contracts are classified within Level 2 of the valuation hierarchy.

The Company’s financial instruments also include cash and cash equivalents, accounts receivables and accounts payables.  The carrying amount of these instruments approximates fair value because of their short-term nature.  The carrying amount of the Company’s long-term debt approximates fair value because the debt is based on current rates at which the Company could borrow funds with similar maturities.

Refer to Note 12 to the Company’s consolidated financial statements for further disclosures on the Company’s financial instruments.

(14) Stockholders' Equity

The Company has two classes of common shares, Common Stock and Nonvoting Common Stock.  Authorized shares of Common Stock were 100,000,000 at December 31, 2014 and 2013.  Authorized shares of Nonvoting Common Stock were 730,746 at December 31, 2014 and 2013. Nonvoting Common Stock with a par value of $0.10 has equal rights with Common Stock, with the exception of voting power.  Nonvoting Common Stock is convertible, share for share, into Common Stock, subject to any legal requirements applicable to holders restricting the extent to which they may own voting stock.  As of December 31, 2014 and 2013, no shares of Nonvoting Common Stock were outstanding.  The Company has authorized 5,000,000 shares of Series Preferred Stock, par value $0.10, issuable in series and with rights, powers and preferences as may be fixed by the Board of Directors.  At December 31, 2014 and 2013, there was no preferred stock outstanding.

59

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(14) Stockholders' Equity (continued)

The Company held treasury shares of 1,738,624 and 1,757,530 at December 31, 2014 and 2013, respectively, which are primarily used for issuance to employee compensation plans.

At December 31, 2014 there were 640,331 authorized shares of Common Stock reserved for issuance through equity compensation plans.

(15) Accumulated Other Comprehensive Loss

The following tables provide the changes in AOCI by component, net of tax, for the years ended December 31, 2014 and 2013:

	Foreign Currency Translation Adjustments			Interest Rate Swap			Pension Plans			Total
Balance as of December 31, 2013	$	9,990		$	(396	)	$	(28,556	)	$	(18,962	)
Other comprehensive loss before reclassifications		(25,800	)		(99	)		(12,566	)		(38,465	)
Amounts reclassified from accumulated other comprehensive loss		4,400			302			7,744			12,446
Net current-period other comprehensive (loss)/income		(21,400	)		203			(4,822	)		(26,019	)
Balance as of December 31, 2014	$	(11,410	)	$	(193	)	$	(33,378	)	$	(44,981	)
	Foreign Currency Translation Adjustments			Interest Rate Swap			Pension Plans			Total
Balance as of December 31, 2012	$	5,177		$	(600	)	$	(38,668	)	$	(34,091	)
Other comprehensive income/(loss) before reclassifications		4,813			(85	)		9,173			13,901
Amounts reclassified from accumulated other comprehensive loss		-			289			939			1,228
Net current-period other comprehensive income		4,813			204			10,112			15,129
Balance as of December 31, 2013	$	9,990		$	(396	)	$	(28,556	)	$	(18,962	)

60

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(15) Accumulated Other Comprehensive Loss (continued)

The following tables provide the reclassifications out of AOCI by component for the years ended December 31, 2014 and 2013:

Details about AOCI Components	Amount Reclassified from AOCI for the year ended December 31, 2014			Affected Line Item in the Consolidated Income Statement
Losses on cash flow hedge:
Interest rate swap	$	(465	)	Interest expense, net
		163		Tax benefit
	$	(302	)	Net of tax
Amortization of defined benefit pension items:
Loss on voluntary settlement	$	(7,170	)	Loss on voluntary pension settlement
Actuarial losses		(756	)	Selling, general and administrative expenses
Actuarial losses		(46	)	Cost of goods sold
Prior service costs		(52	)	Selling, general and administrative expenses
		(8,024	)	Total before tax
		280		Tax benefit
	$	(7,744	)	Net of tax
Foreign currency translation adjustment:
Release of currency translation adjustment	$	(4,400	)	Equity in losses of partially-owned affiliates
		-		Tax benefit
	$	(4,400	)	Net of tax
Total reclassification for the period	$	(12,446	)
Details about AOCI Components	Amount Reclassified from AOCI for the year ended December 31, 2013			Affected Line Item in the Consolidated Income Statement
Losses on cash flow hedge:
Interest rate swap	$	(444	)	Interest expense, net
		155		Tax benefit
	$	(289	)	Net of tax
Amortization of defined benefit pension items:
Actuarial losses	$	(1,223	)	Selling, general and administrative expenses
Actuarial losses		(116	)	Cost of goods sold
Prior service costs		(50	)	Selling, general and administrative expenses
		(1,389	)	Total before tax
		450		Tax benefit
	$	(939	)	Net of tax
Total reclassification for the period	$	(1,228	)

61

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(16) Stock Based Compensation

The Company recognizes compensation cost for stock options awarded to employees based on their grant-date fair value.  The value of each stock option is estimated on the date of grant using the Black-Scholes option-pricing model.  The weighted-average fair value per share for the stock options granted to employees for the years ended December 31, 2014, 2013 and 2012 were $7.15, $7.97 and $7.14, respectively.

The following assumptions were used in determining the fair value of stock options for grants issued in 2014, 2013 and 2012:

	2014	2013	2012
Expected volatility	35.14%-46.32%	44.17%-71.58%	71.84%
Expected term	1.75-4.75 years	1.25-4.75 years	4.75 years
Risk-free interest rate	0.43%-1.50%	0.12%-1.37%	0.66%

The Company does not have any publicly traded stock options; therefore, expected volatilities are based on historical volatility of the Company’s stock.  The risk-free interest rate is based on the yield of a zero-coupon U.S. Treasury bond whose maturity period approximates the option’s expected term.  The expected term was utilized based on the “simplified” method for determining the expected term of stock options.

For 2014, 2013, and 2012, the Company recorded $2,491, $1,994 and $1,303, respectively, in selling, general and administrative expenses for stock options.  As of December 31, 2014, the total compensation cost related to unvested stock option awards granted to employees but not yet recognized was $7,197.  The cost will be amortized on a straight-line basis over the remaining weighted-average vesting period of 2.8 years.

The following table is a summary of the Company’s stock option activity issued to employees and related information:

				Weighted Average
	Number of Shares			Exercise Price		Options Exercisable
Outstanding at December 31, 2013		2,229,969		$	9.39		1,149,069
Granted		479,788			18.12
Exercised		(596,135	)		7.05
Forfeited or expired		(42,950	)		10.12
Outstanding at December 31, 2014		2,070,672			12.08
Exercisable at December 31, 2014		971,797		$	8.71

The aggregate intrinsic value for all stock options exercised for the years ended December 31, 2014, 2013 and 2012 was $8,910, $5,017 and $1,658, respectively.  The aggregate intrinsic values for all stock options outstanding and exercisable as of December 31, 2014 were $19,766 and $12,546, respectively.

62

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(16) Stock Based Compensation (continued)

A summary of the Company’s nonvested stock options and restricted stock activity is presented below:

	Nonvested Stock Options					Nonvested Restricted Stock
	Number of Shares			Weighted- Average Grant- Date Fair Value		Number of Shares			Weighted- Average Grant- Date Fair Value
Nonvested at December 31, 2013		1,080,900		$	6.50		-		$	-
Granted		479,788			7.15		18,906			20.90
Vested during period		(431,413	)		5.60		(18,906	)		20.90
Forfeited		(30,400	)		6.44		-			-
Nonvested at December 31, 2014		1,098,875		$	7.14		-		$	-

Members of the Cambrex Board of Directors currently participate in an incentive plan which rewards service with restricted stock units.  Awards are made annually and vest over six months.  On the six month anniversary of the grant, restrictions on sale or transfer are removed and shares are issued to the Directors.  These awards are classified as equity awards.

For 2014, 2013, and 2012, the Company recorded $395, $427, and $446, respectively, in selling, general and administrative expenses for restricted stock units.  As of December 31, 2014, all restricted stock unit grants were fully vested.

The Company granted equity-settled performance shares (“PSs”) to certain executives.  PS awards provide the recipient the right to receive a certain number of shares of the Company’s common stock in the future, which depends on the Company’s level of achievement of revenue and EBITDA growth as compared to the revenue and EBITDA growth of the members of a specified peer group of companies over a three year period.  The peer group consists of publicly-traded life sciences companies competing in the same industry as the Company.  For 2014, 2013 and 2012, the Company recorded $2,116, $404 and $53, respectively, in selling, general and administrative expense related to these PS awards.

The Company granted cash-settled performance share units (“PSUs”) to certain executives.  PSU awards provide the recipient the right to receive the cash value of a certain number of shares of the Company’s common stock in the future, which depends on the Company’s level of achievement of revenue and EBITDA growth as compared to the revenue and EBITDA growth of the members of a specified peer group of companies typically over a three year period.  The peer group consists of publicly-traded life sciences companies competing in the same industry as the Company.  For 2014, 2013 and 2012, the Company recorded $445, $2,620 and $1,529, respectively, in selling, general and administrative expenses for PSU awards.  The decrease is primarily the result of the Company’s performance compared to the peer group partially offset by the Company’s higher share price.

63

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(17) Retirement Plans

Domestic Pension Plan

The Company maintains a defined-benefit pension plan (“Domestic Pension Plan”) for certain salaried and certain hourly employees.  The Company also has a Supplemental Executive Retirement Plan (“SERP”) for key executives.  This plan is non-qualified and unfunded.  Benefits accruing under both plans were frozen in 2007.  In July 2008, the Board of Directors of the Company amended the SERP to allow for lump sum payments effective January 1, 2009.  The lump sum value as of January 1, 2009 will be paid in 10 equal actuarial equivalent installments through 2018.  It is the Company’s policy to contribute to the domestic pension plan to ensure adequate funds are available in the plan to make benefit payments to plan participants and beneficiaries when required.

In the third quarter of 2014, the Company announced a program to offer a one-time option to elect to receive a voluntary lump-sum pension payout to certain former employees with deferred vested balances in the Company’s U.S. pension plan. As part of this voluntary lump-sum program, the Company settled $17,381 of pension obligations for the U.S. plan with an equal amount paid from plan assets. As a result, the Company recorded settlement losses of $7,170 reflecting the accelerated recognition of unamortized losses in the U.S. pension plan proportionate to the obligation that was settled. The loss on voluntary pension settlement is reflected as a separate line in the consolidated income statement with a corresponding balance sheet reduction in “Accumulated other comprehensive loss.”

International Pension Plans

A foreign subsidiary of the Company maintains a pension plan (“International Pension Plan”) for its employees that conforms to the common practice in that country.  Based on local laws and customs, this plan is unfunded.

Savings Plan

Cambrex makes available to all domestic employees a savings plan.  Employee contributions are matched in part by Cambrex.  The cost of this plan amounted to $941, $731 and $733 in 2014, 2013 and 2012, respectively.

Other

The Company has a non-qualified Deferred Compensation Plan for Key Executives (“The Plan”).  Under this Plan, officers and key employees may elect to defer all or any portion of their pre-tax earnings or elect to defer receipt of the Company’s stock which would otherwise have been issued upon the exercise of the Company’s options.  Included within other liabilities at December 31, 2014 and 2013 is $932 and $1,049, respectively, representing the Company’s obligation under the plan.  The Company invests in certain mutual funds and as such, included within other assets at December 31, 2014 and 2013 is $932 and $1,049, respectively, representing the fair value of these funds.  The fair values of these mutual funds are based on quoted market prices in active markets (Level 1).  The number of Cambrex shares held in trust under this plan as of December 31, 2014 and 2013 were 49,121, and are included as a reduction of equity.  The value of the shares held in trust and the corresponding liability of $1,062 and $876 at December 31, 2014 and 2013, respectively, have also been recorded in equity.  The Plan is not funded by the Company, but the Company has established a Deferred Compensation Trust Fund which holds the shares issued. Effective December 2011, the Board of Directors suspended employee contributions to this Plan.

64

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(17) Retirement Plans (continued)

The benefit obligations as of December 31, 2014 and 2013 are as follows:

	Pension Plans
	Domestic						SERP						International
	2014			2013			2014			2013			2014			2013
Change in benefit obligation
Benefit obligation, beginning of year	$	70,709		$	79,958		$	3,086		$	3,690		$	25,627		$	27,033
Service cost		-			-			-			-			674			743
Interest cost		3,310			3,057			33			41			884			658
Actuarial loss/(gain)		11,813			(8,269	)		2			(9	)		5,319			(2,314	)
Benefits paid		(3,160	)		(4,037	)		(732	)		(636	)		(763	)		(808	)
Currency translation affect		-			-			-			-			(5,041	)		315
Settlements		(17,847	)		-			-			-			-			-
Benefit obligation, end of year	$	64,825		$	70,709		$	2,389		$	3,086		$	26,700		$	25,627

The plan assets and funded status of the Domestic Pension Plan as of December 31, 2014 and 2013 are as follows:

	2014			2013
Change in plan assets
Fair value of plan assets, beginning of period	$	57,743		$	53,900
Actual return on plan assets		2,605			6,894
Contributions		2,324			986
Benefits paid		(3,160	)		(4,037	)
Settlements		(17,847	)		-
Fair value of plan assets, end of period	$	41,665		$	57,743
Unfunded status		(23,160	)		(12,966	)
Accrued benefit cost, end of period	$	(23,160	)	$	(12,966	)

The unfunded status of the SERP was ($2,389) and ($3,086) as of December 31, 2014 and 2013, respectively.  The unfunded status of the International Pension Plan was ($26,700) and ($25,627) as of December 31, 2014 and 2013, respectively.

The amounts recognized in AOCI as of December 31, 2014 and 2013 consist of the following:

	Pension Plans
	Domestic				SERP				International
	2014		2013		2014		2013		2014			2013
Actuarial loss	$	26,042	$	20,373	$	702	$	830	$	9,597		$	4,765
Prior service cost/(benefit)		-		-		172		230		(17	)		(24	)
Total	$	26,042	$	20,373	$	874	$	1,060	$	9,580		$	4,741

65

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(17) Retirement Plans (continued)

The components of net periodic benefit cost are as follows:

	Pension Plans
	Domestic									SERP						International
	2014			2013			2012			2014		2013		2012		2014			2013			2012
Components of net periodic benefit cost
Service cost	$	-		$	-		$	-		$	-	$	-	$	-	$	674		$	743		$	660
Interest cost		3,310			3,057			3,284			33		41		85		884			658			795
Expected return on plan assets		(4,153	)		(3,826	)		(3,674	)		-		-		-		-			-			-
Amortization of prior service cost/(benefit)		-			-			60			57		57		57		(7	)		(7	)		(7	)
Recognized actuarial loss		522			937			864			131		118		76		149			284			200
Settlement loss		7,170			-			-			-		-		-		-			-			-
Net periodic benefit cost	$	6,849		$	168		$	534		$	221	$	216	$	218	$	1,700		$	1,678		$	1,648

The estimated amounts that will be amortized from AOCI into net periodic benefit cost in 2015 are as follows:

	Pension Plans
	Domestic		SERP		International
Actuarial loss	$	811	$	154	$	359
Prior service cost/(benefit)		-		57		(6	)
Total	$	811	$	211	$	353

Major assumptions used in determining the benefit obligations are presented in the following table:

	2014	2013
Discount rate:
Domestic Pension Plan	3.85%	4.80%
SERP	1.35%	1.40%
International Pension Plan	2.40%	3.70%
Rate of compensation increase:
International Pension Plan	2.20%	2.50%

66

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(17) Retirement Plans (continued)

Major assumptions used in determining the net benefit cost are presented in the following table:

	2014	2013	2012
Discount rate:
Domestic Pension Plan	4.80%	3.90%	4.45%
SERP	1.40%	1.35%	2.40%
International Pension Plan	3.70%	3.40%	3.40%
Expected return on plan assets:
Domestic Pension Plan	7.25%	7.25%	7.50%
Rate of compensation increase:
International Pension Plan	2.20%	2.50%	2.40%

In making its assumption for the long-term rate of return on plan assets, the Company has utilized historical rates earned on securities allocated consistently with its investments.  The discount rate was selected by projecting cash flows associated with plan obligations, which were matched to a yield curve of high quality corporate bonds.  The Company then selected the single rate that produced the same present value as if each cash flow were discounted by the corresponding spot rate on the yield curve.

The aggregate Accumulated Benefit Obligation (“ABO”) of $64,825 exceeds plan assets by $23,160 as of December 31, 2014 for the Domestic Pension Plan.  The aggregate ABO is $25,459 for the International Pension Plan as of December 31, 2014.  The International Pension Plan is unfunded.

The Company expects to contribute approximately $1,900 in cash to the Domestic Pension Plan in 2015.  The Company does not expect to contribute cash to its International Pension Plan in 2015.

The following benefit payments are expected to be paid out of the plans:

	Pension Plans
	Domestic		SERP		International
2015	$	3,429	$	609	$	689
2016	$	3,401	$	609	$	699
2017	$	3,470	$	609	$	709
2018	$	3,400	$	609	$	767
2019	$	3,482	$	-	$	824
2020-2024	$	18,054	$	-	$	4,865

The investment objective for the Domestic Pension Plan’s assets is to achieve long-term growth with exposure to risk at an appropriate level.  The Company invests in a diversified asset mix consisting of equities (domestic and international) and taxable fixed income securities.  Assets are managed to obtain the highest total rate of return in keeping with a moderate level of risk.  The target allocations for plan assets are 30% - 80% equity securities, 25% - 45% U.S. fixed income and 5% - 15% all other investments.  Equity securities primarily include investments in large-cap and small-cap companies, U.S. fixed income securities including high quality corporate bonds, and U.S. government securities.  Other types of investments include real asset funds, consisting primarily of investments in commodities, and Treasury Inflation-Protected Securities (“TIPS”).

67

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(17) Retirement Plans (continued)

The fair values of the Company’s pension plan assets by asset category are as follows:

			Fair Value Measurements at December 31, 2014 using:
Asset Category	Total		(Level 1)		(Level 2)		(Level 3)
Equity securities:
U.S. companies	$	14,513	$	-	$	14,513	$	-
International companies		7,900		-		7,900		-
U.S. fixed income		14,093		-		11,964		2,129
Commodities		3,161		-		3,161		-
TIPS		1,998		-		1,998		-
	$	41,665	$	-	$	39,536	$	2,129
			Fair Value Measurements at December 31, 2013 using:
Asset Category	Total		(Level 1)		(Level 2)		(Level 3)
Equity securities:
U.S. companies	$	20,633	$	-	$	20,633	$	-
International companies		11,157		-		11,157		-
U.S. fixed income		18,736		-		16,660		2,076
Commodities		4,436		-		4,436		-
TIPS		2,781		-		2,781		-
	$	57,743	$	-	$	55,667	$	2,076

The following table sets forth a summary of the changes in the fair value of the Domestic Plan’s Level 3 assets, which are annuity contracts with an insurance company, for the year ended December 31, 2014:

	Group Annuity Contract
Balance at December 31, 2013	$	2,076
Net investment gain		53
Balance at December 31, 2014	$	2,129

68

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(18) Foreign Operations and Sales

The following summarized data represents the gross sales and long lived assets for the Company’s domestic and foreign entities for 2014, 2013 and 2012:

	Domestic		Foreign		Total
2014
Gross sales	$	186,735	$	187,415	$	374,150
Long-lived assets		64,995		151,386		216,381
2013
Gross sales	$	153,202	$	164,010	$	317,212
Long-lived assets		59,496		155,151		214,647
2012
Gross sales	$	109,729	$	168,202	$	277,931
Long-lived assets		44,085		149,133		193,218

Export sales, included in domestic gross sales, in 2014, 2013 and 2012 amounted to $101,101, $86,850, and $32,872, respectively.

Sales to geographic area consist of the following:

	2014		2013		2012
Europe	$	232,894	$	210,463	$	150,678
North America		117,477		86,974		105,439
Asia		12,865		13,800		12,827
Other		10,914		5,975		8,987
Total	$	374,150	$	317,212	$	277,931

One customer accounted for 24.0% and 18.3% of 2014 and 2013 consolidated gross sales, respectively, and another customer accounted for 12.5% of 2012 consolidated gross sales.

(19) Commitments

The Company has operating leases expiring on various dates through the year 2020.  The leases are primarily for the rental of office space, office and laboratory equipment and vehicles.  At December 31, 2014, future minimum commitments under non-cancelable operating lease arrangements were as follows:

Year ended December 31:
2015	$	1,194
2016		600
2017		588
2018		528
2019		193
2020 and thereafter		90
Total commitments	$	3,193

69

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(19) Commitments (continued)

Total operating lease expense was $1,113, $1,090 and $815 for the years ended December 31, 2014, 2013 and 2012, respectively.

The Company is party to several unconditional purchase obligations resulting from contracts that contain legally binding provisions with respect to quantities, pricing and timing of purchases.  The Company’s purchase obligations mainly include commitments to purchase utilities.  At December 31, 2014, future commitments under these obligations were $7,588 in 2015 and none thereafter.

(20) Contingencies

The Company is subject to various investigations, claims and legal proceedings covering a wide range of matters that arise in the ordinary course of its business activities.  The Company continually assesses known facts and circumstances as they pertain to applicable legal and environmental matters and evaluates the need for reserves and disclosures as deemed necessary based on these facts and circumstances.  These matters, either individually or in the aggregate, could result in actual costs that are significantly higher than the Company’s current assessment and could have a material adverse effect on the Company's operating results and cash flows in future reporting periods. While these matters could have a material adverse effect on the Company’s financial condition, based upon past experience, the Company believes that payments significantly in excess of current reserves, if required, would be made over an extended number of years.

Environmental

In connection with laws and regulations pertaining to the protection of the environment, the Company and its subsidiaries are a party to several environmental proceedings and remediation activities and along with other companies, have been named a potentially responsible party (“PRP”) for certain waste disposal sites ("Superfund sites").  Substantially all of the liabilities currently recorded on the Company’s balance sheet for environmental proceedings are associated with discontinued operations. The Company had insurance policies in place at certain of the discontinued operations for certain years that the Company believes should cover some portion of currently recorded liabilities or potential future liabilities.

It is the Company’s policy to record appropriate liabilities for environmental matters where remedial efforts are probable and the costs can be reasonably estimated.  Such liabilities are based on the Company’s estimate of the undiscounted future costs required to complete the remedial work.  Each of these matters is subject to various uncertainties, and it is possible that some of these matters will be decided against the Company. The resolution of such matters often spans several years and frequently involves regulatory oversight or adjudication.  Additionally, many remediation requirements are fluid and are likely to be affected by future technological, site and regulatory developments.  It is not possible at this time for the Company to determine fully the effect of all asserted and unasserted claims on its consolidated financial condition, results of operations or liquidity; however, to the extent possible, where asserted and unasserted claims can be estimated and where such claims are considered probable, the Company would record a liability. Consequently, the ultimate liability with respect to such matters, as well as the timing of cash disbursements, is uncertain.

70

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(20) Contingencies (continued)

In matters where the Company is able to reasonably estimate the probable and estimable costs associated with environmental proceedings, the Company accrues for the estimated costs associated with the study and remediation of applicable sites. These reserves were $9,595 and $10,881 at December 31, 2014 and 2013, respectively. The decrease in the reserve includes payments of $2,269 and the impact of currency translation of $226 partially offset by adjustments to reserves of $1,209. The reserves are adjusted periodically as remediation efforts progress or as additional technical, regulatory or legal information becomes available.  Given the uncertainties regarding the outcome of investigative and study activities, the status of laws, regulations, enforcement, policies, the impact of other PRPs, technology and information related to individual sites, the Company does not believe it is possible to currently develop an estimate of the range of reasonably possible environmental loss in excess of its reserves.

CasChem

As a result of the sale of a Bayonne, New Jersey facility, the Company became obligated to investigate site conditions and conduct required remediation under the New Jersey Industrial Site Recovery Act.  The Company intends to continue implementing a sampling plan at the property pursuant to the New Jersey Department of Environmental Protection’s (“NJDEP”) private oversight program.  The results of the completed sampling, and any additional sampling deemed necessary, will be used to develop an estimate of the Company's future liability for remediation costs.  As of December 31, 2014, the Company’s reserve for the investigation of site conditions was $193.

Cosan

The Company has implemented a sampling and pilot program in Clifton, New Jersey pursuant to the NJDEP private oversight program.  The results of the sampling and pilot program to date have been used to develop an estimate of the Company's future liability for remediation costs.  As of December 31, 2014, the Company’s reserve was $1,191.

Additionally, the Company has implemented a sampling and pilot program in Carlstadt, New Jersey pursuant to the NJDEP private oversight program.  The results of the sampling and pilot program to date have been used to develop an estimate of the Company's future liability for remediation costs. As of December 31, 2014, the Company’s reserve was $1,063.

Berry’s Creek

The Company received a notice from the United States Environmental Protection Agency (“USEPA”) that two subsidiaries of the Company are considered PRPs at the Berry’s Creek Study Area in New Jersey.  These subsidiaries are among many other PRPs that were listed in the notice.  Pursuant to the notice, the PRPs have been asked to perform a remedial investigation and feasibility study of the Berry’s Creek site. The Company has joined the group of PRPs and entered into an Administrative Settlement Agreement (“Agreement”) and Order on Consent with the USEPA agreeing to jointly conduct or fund an appropriate remedial investigation and feasibility study of the Berry’s Creek site with the other PRPs in the Agreement. The PRPs have engaged consultants to perform the work specified in the Agreement and develop a method to allocate related costs among the PRPs.  As of December 31, 2014, the Company’s reserve was $388 to cover the current phase of investigation based on a tentative agreement on the allocation of the site investigation costs among the PRPs.   Due to the very preliminary and uncertain nature of any estimates related to the method and costs of any remediation solution, the number of eventual PRPs, and their respective proportion of remediation costs, the Company’s liability cannot be reasonably estimated at this time; as such, no accrual is recorded for these potential future costs. The impact of the resolution of this matter on the Company’s results of operations in any future reporting period is not known.

71

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(20) Contingencies (continued)

In July 2014, the Company received a notice from the U.S. Department of the Interior, U.S. Fish & Wildlife Service, regarding the Company’s potential liability for natural resource damages at the Berry’s Creek site and inviting the Company to participate in a cooperative assessment of natural resource damages.  All members of the Berry’s Creek PRP group are receiving such notice letters, and any response from the Company will be coordinated with the PRP Group.  The substance of any response from the Company, the cost of any assessment, and the ultimate scope of natural resource damage liability are not yet known.

Maybrook Site

A subsidiary of Cambrex is named a PRP of a site in Hamptonburgh, New York by the USEPA in connection with the discharge, under appropriate permits, of wastewater at that site prior to Cambrex's acquisition in 1986.  The PRPs implemented soil remediation which was completed in 2012 pending approval by the USEPA.  The PRPs will continue implementing the ground water remediation at the site. As of December 31, 2014, the Company’s reserve was $322 to cover remaining ground water remediation and long-term monitoring.

Harriman Site

Subsidiaries of Cambrex and Pfizer are named as responsible parties for the Company’s former Harriman, New York production facility by the New York State Department of Environmental Conservation (“NYSDEC”).  A final ROD (“Record of Decision”) describing the Harriman site remediation responsibilities for Pfizer and the Company was issued in 1997 (the "1997 ROD") and incorporated into a federal court Consent Decree in 1998 (the “Consent Decree”).  Site clean-up work under the 1997 ROD is ongoing and is being jointly performed by Pfizer and the Company, with NYSDEC oversight.  ELT Harriman, LLC ("ELT"), the current owner of the Harriman site, is conducting other investigation and remediation activities under a separate NYSDEC directive.

In October 2013, the NYSDEC sent the Company, Pfizer, ELT and the immediately preceding owner Vertellus Specialties Holdings (“Vertellus”) an enforcement letter demanding that the Company and Pfizer submit a work plan for the further study and remediation of certain areas of the Harriman site, including the evaluation of certain remedies that the Company has contended are not required by the 1997 ROD.  In December 2013, the Company, Pfizer and the NYSDEC entered into a federal court stipulation, which the court subsequently endorsed as a court order, withdrawing the October 2013 enforcement letter as it relates to the Company and Pfizer, and resolving certain disputes about the scope of their obligations under the Consent Decree and the 1997 ROD.  Pursuant to the court order, the Company and Pfizer are required to carry out an environmental investigation and study of certain areas of the Harriman Site.

No final remedy for the site has been determined, which will follow further discussions with the NYSDEC.  The Company estimated the range for its share of the liability at the site to be between $2,000 and $7,000.  As of December 31, 2014, the Company’s reserve was $3,615.  At this time, the Company is unable to provide an estimate of the ultimate investigative and remedial costs to the Company for any final remedy selected by the NYSDEC.

72

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(20) Contingencies (continued)

The Company intends to enforce all of its contractual rights to recover costs and for indemnification under a 2007 settlement agreement, and has filed such claims in an arbitration proceeding against ELT and Vertellus. ELT has filed counterclaims, and has threatened to file additional counterclaims, for contractual indemnification and for breach of the settlement agreement against the Company.  Currently, the arbitration proceeding is stayed indefinitely.

Scientific Chemical Processing (“SCP”) Superfund Site

A subsidiary of Cambrex was named a PRP of the SCP Superfund site, located in Carlstadt, New Jersey, along with approximately 130 other PRPs.  The site is a former waste processing facility that accepted various waste for recovery and disposal including processing wastewater from this subsidiary.  The PRPs are in the process of implementing a final remedy at the site.  The SCP Superfund site has also been identified as a PRP in the Berry’s Creek Superfund site (see previous discussion). For over a decade, the remediation has been funded by de minimus settlements and by the insurers of the SCP Superfund site’s owners and operators.  However, due to an unexpected increase in remediation costs at the site and costs related to SCP’s involvement in the Berry’s Creek investigation, the PRP group approved the assessment of an additional cash contribution by the PRP group.  While the Company continues to dispute the methodology used by the PRP group to arrive at its allocation for the cash contribution, the Company has paid the recent funding requests in 2010 and 2014.  The next funding request is expected in 2015. A final allocation of SCP Site costs is expected to be developed concurrent with the final allocation process for Berry’s Creek Study Area starting in 2015.  As of December 31, 2014, the Company’s reserve was $1,039, of which approximately $737 is expected to be covered by insurance.

Newark Bay Complex

Two subsidiaries of the Company were named along with several hundred third-party defendants in a third-party complaint filed in February 2009, by Maxus Energy Corporation (“Maxus”) and Tierra Solutions, Inc. (“Tierra”) relating to a N.J. state action concerning the  Passaic River, Newark Bay, Hackensack River, Arthur Kill, Kill Van Kull and adjacent waters (the “Newark Bay Complex”).  The Company settled this case which resolved certain New Jersey state based claims related to the Newark Bay Complex. The settlement will require Maxus and Tierra to re-file  any further claims against the Company in federal court.   In preparation for any such federal or similar claims, the Company is currently monitoring developments regarding the Newark Bay Complex.  Due to the uncertainty of the future scope and timing of any such claims, the Company’s liability cannot be reasonably estimated at this time, and as such, no accrual is recorded for these potential future costs.

The Company is involved in other related and unrelated environmental matters where the range of liability is not reasonably estimable at this time and it is not foreseeable when information will become available to provide a basis for adjusting or recording a reserve, should a reserve ultimately be required.

Litigation and Other Matters

Lorazepam and Clorazepate

In 1998, the Company and a subsidiary were named as defendants along with Mylan Laboratories, Inc. (“Mylan”) and Gyma Laboratories, Inc. (“Gyma”) in a proceeding instituted by the Federal Trade Commission in the United States District Court for the District of Columbia (the “District Court”). Suits were also commenced by several State Attorneys General and class action complaints by private plaintiffs in various state courts. The suits alleged violations of the Federal Trade Commission Act arising from exclusive license agreements between the Company and Mylan covering two APIs (Lorazepam and Clorazepate).

73

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(20) Contingencies (continued)

All cases have been resolved except for one brought by four health care insurers. In the remaining case, the District Court entered judgment after trial in 2008 against Mylan, Gyma and Cambrex in the total amount of $19,200, payable jointly and severally, and also a punitive damage award against each defendant in the amount of $16,709.  In addition, at the time, the District Court ruled that the defendants were subject to a total of approximately $7,500 in prejudgment interest. The case is currently pending before the District Court following a January 2011 remand by the Court of Appeals.  In July 2014, the District Court dismissed certain customers for which the plaintiffs were unable to establish jurisdiction and consequently, the plaintiffs currently have a motion pending before the District Court to reduce the damages award by a total of $9,600.

In 2003, Cambrex paid $12,415 to Mylan in exchange for a release and full indemnity against future costs or liabilities in related litigation brought by the purchasers of Lorazepam and Clorazepate, as well as potential future claims related to the ongoing matter.  Mylan has submitted a surety bond underwritten by a third-party insurance company in the amount of $66,632.  In the event of a final settlement or final judgment, Cambrex expects any payment required by the Company to be made by Mylan under the indemnity described above.

Other

The Company has commitments incident to the ordinary course of business including corporate guarantees of certain subsidiary obligations to the Company’s lenders related to financial assurance obligations under certain environmental laws for remediation; closure and third party liability requirements of certain of its subsidiaries and a former operating location; contract provisions for indemnification protecting its customers and suppliers against third party liability for the manufacture and sale of Company products that fail to meet product warranties and contract provisions for indemnification protecting licensees against intellectual property infringement related to licensed Company technology or processes.

Additionally, as permitted under Delaware law, the Company indemnifies its officers, directors and employees for certain events or occurrences while the officer, director or employee is, or was, serving at the Company’s request in such capacity. The term of the indemnification period is for the officer's, director's or employee’s lifetime. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited; however, the Company has a director and officer insurance policy that covers a portion of any potential exposure.  The Company currently believes the estimated fair value of its indemnification agreements is not material based on currently available information, and as such, the Company had no liabilities recorded for these agreements as of December 31, 2014.

Cambrex's subsidiaries are party to a number of other proceedings that are not considered material at this time.

(21) Discontinued Operations

For 2014, the Company recorded pre-tax charges of $1,277, reduced by a tax benefit of $447, for environmental remediation related to sites of divested businesses as discontinued operations.  For 2013, the Company recorded pre-tax charges of $6,708, reduced by a tax benefit of $2,348, for environmental remediation related to sites of divested businesses as discontinued operations.  For 2012, the Company recorded pre-tax charges of $1,425, reduced by a tax benefit of $499, for environmental remediation related to sites of divested businesses as discontinued operations.

74

CAMBREX CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands, except per share data)

(22) Gain on Sale of Asset

For the year ended December 31, 2014, the Company recorded a gain on the sale of land of $1,234.  For the year ended December 31, 2013, the Company recorded a gain on the sale of an office building of $4,680.  The carrying values of the building and land were not material.

75

CAMBREX CORPORATION AND SUBSIDIARIES

SELECTED QUARTERLY FINANCIAL AND SUPPLEMENTARY DATA - UNAUDITED

(in thousands, except share and per share data)

	1st Quarter (1)			2nd Quarter (2)			3rd Quarter (3)			4th Quarter (4)
2014
Gross sales	$	66,192		$	97,972		$	81,145		$	128,841
Net revenues		66,105			97,893			81,300			129,315
Gross profit		16,578			33,415			28,406			45,399
Income from continuing operations		1,166			19,827			8,882			28,258
Loss from discontinued operations (6)		(184	)		(160	)		(113	)		(373	)
Net income		982			19,667			8,769			27,885
Earnings per share of common stock: (7)
Basic		0.03			0.64			0.28			0.90
Diluted		0.03			0.63			0.28			0.88
Average shares:
Basic		30,546			30,647			30,801			31,053
Diluted		31,408			31,428			31,599			31,803
	1st Quarter (5)			2nd Quarter			3rd Quarter			4th Quarter
2013
Gross sales	$	74,581		$	61,628		$	77,992		$	103,011
Net revenues		74,885			62,803			77,452			103,036
Gross profit		24,749			19,251			24,966			33,938
Income from continuing operations		11,425			3,136			6,274			9,440
Loss from discontinued operations (6)		(257	)		(862	)		(2,700	)		(541	)
Net income		11,168			2,274			3,574			8,899
Earnings per share of common stock: (7)
Basic		0.37			0.07			0.12			0.29
Diluted		0.36			0.07			0.12			0.29
Average shares:
Basic		29,970			30,089			30,184			30,353
Diluted		30,788			30,956			31,052			31,166

(1) Income from continuing operations includes the reversal of a valuation allowance on deferred tax assets of $198.

(2) Income from continuing operations includes the reversal of a valuation allowance on deferred tax assets of $14,161 and a loss of $4,122 related to the purchase of the remaining shares in Zenara.

(3) Income from continuing operations includes the reversal of a valuation allowance on deferred tax assets of $824.

(4) Income from continuing operations includes a gain on sale of land of $1,234 and a corresponding tax expense of $387, a benefit of $11,719 for the reversal of a valuation allowance on deferred tax assets, a benefit of $3,948 for favorable audit settlements, and expense of $7,170 related to a voluntary lump sum pension settlement.

(5) Income from continuing operations includes a gain on sale of an office building of $4,680 and a corresponding tax expense of $1,470 and a benefit of $1,155 due to changes in tax laws.

(6) Discontinued operations include charges for environmental remediation related to sites of divested businesses.

(7) Earnings per share calculations for each of the quarters are based on the weighted average number of shares outstanding for each period.  As such, the sum of the quarters may not necessarily equal the earnings per share amount for the year.

76

Item 9 Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

None.

Item 9A Controls and Procedures.

Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (“Exchange Act”) that are designed to ensure that information required to be disclosed in its reports filed or submitted under the Exchange Act is processed, recorded, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

As required by SEC Rule 13a-15(b), the Company carried out an evaluation, under the supervision and with the participation of management, including the Company’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures as of the end of the period covered by this Annual Report. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that as of December 31, 2014, our disclosure controls and procedures are effective to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is (i) recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

Management's Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Exchange Act Rule 13a-15(f).  Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States, and include those policies and procedures that:

· Pertain to the maintenance of records, that in reasonable detail, accurately and fairly represent the transactions and dispositions of the assets of the Company,

· Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures are being made only in accordance with authorizations of management and the Board of Directors of the Company, and

· Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

77

Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we carried out an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2014 based on the Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO").  Our management concluded that based on its assessment, our internal control over financial reporting was effective as of December 31, 2014.  Effectiveness of our internal control over financial reporting as of December 31, 2014 has been audited by BDO USA, LLP, an independent registered public accounting firm, as stated in their report which appears elsewhere herein.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Exchange Act Rules 13a-15 or 15d-15 that occurred during our last fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Item 9B Other Information.

None.

78

PART III

Item 10 Directors, Executive Officers and Corporate Governance.

Executive Officers of the Registrant

The following table lists the officers of the Company:

Name	Age	Office
Steven M. Klosk (i) (ii)	57	President, Chief Executive Officer
Shawn P. Cavanagh (i) (ii)..	48	Executive Vice President and Chief Operating Officer
James G. Farrell (ii)	48	Vice President and Corporate Controller
William M. Haskel (i) (ii)	53	Senior Vice President, General Counsel, Corporate Secretary and Chief Compliance Officer
Aldo G. Magnini (i)	61	Managing Director, Cambrex Profarmaco Milano
Gregory P. Sargen (i) (ii)	49	Executive Vice President and Chief Financial Officer

(i)  Executive Officer (ii)Corporate Officer

The Company's corporate officers are appointed by the Board of Directors and serve at the Board's discretion.

Mr. Klosk joined Cambrex in October 1992 and has served as President and Chief Executive Officer since May 2008.  He also became a member of the Board of Directors in May 2008.  Mr. Klosk joined the Company as Vice President, Administration.  He was appointed Executive Vice President, Administration in October 1996 and was promoted to the position of Executive Vice President, Administration and Chief Operating Officer for the Cambrex Pharma and Biopharmaceutical Business Unit in October 2003.  In January 2005, Mr. Klosk assumed direct responsibility for the leadership of the Biopharmaceutical Business Unit as Chief Operating Officer.  In August 2006, Mr. Klosk assumed the responsibility of the Pharma business as Executive Vice President and Chief Operating Officer – Biopharma & Pharma and in February 2007 was appointed to Executive Vice President, Chief Operating Officer and President, Pharmaceutical Products and Services.  From 1988 until he joined Cambrex, Mr. Klosk was Vice President, Administration and Corporate Secretary for The Genlyte Group, Inc.  From 1985 to 1988, he was Vice President, Administration for Lightolier, Inc., a subsidiary of The Genlyte Group, Inc. Mr. Klosk currently serves on the Board of Directors of NeoStem, Inc., a publicly traded cell therapy company.

Mr. Cavanagh joined Cambrex in January 2011 and currently serves as Executive Vice President and Chief Operating Officer.  From 2007 to 2009 Mr. Cavanagh was employed with Lonza, which purchased Cambrex Bioproducts, most recently as President of Lonza Bioscience.   From 1999 to 2007, Mr. Cavanagh worked for Cambrex Bioproducts.  While at Cambrex Bioproducts, Mr. Cavanaugh held several positions of increasing responsibility including President of Cambrex Bioproducts.  Prior to joining Cambrex Bioproducts, Mr. Cavanagh held various management and engineering positions with FMC Corporation.

Mr. Farrell joined Cambrex in September 2005 as Corporate Controller.  He has served as Vice President and Corporate Controller since July 2007, except for a portion of 2008 when Mr. Farrell was employed by PDI, Inc. as Vice President and Corporate Controller/Interim Chief Financial Officer.  From 1994 until 2005, he was with Ingersoll-Rand Company, most recently as Director, Accounting Policy, Procedures and External Reporting.  Mr. Farrell was with Ernst & Young from 1988 to 1994, most recently as Audit Manager.

79

Mr. Haskel joined Cambrex in June 2011 and currently serves as Senior Vice President, General Counsel, Corporate Secretary and Chief Compliance Officer.  Prior to joining Cambrex, Mr. Haskel was employed by Wyeth from 1992 until 2010, serving a variety of roles including Vice President and Associate General Counsel-Corporate, Vice President of Global Administration, and Assistant Vice President working with the Chairman and CEO and serving as Secretary to the Management Committee. Prior to 1992, Mr. Haskel was a corporate associate at Hale and Dorr (now WilmerHale).

Dr. Magnini joined Cambrex Profarmaco Milano S.r.l. (“CPM”) in 1996 as Commercial Director, Marketing and Sales; in 2005, he became Managing Director and in January 2014 assumed full responsibility of CPM.  Prior to joining CPM, Dr. Magnini held various senior management roles in other pharmaceutical companies and from 2003 to 2004 served as Managing Director of Clariant Pharma, an Italian API manufacturer.

Mr. Sargen joined Cambrex in February 2003 and has served as Vice President and Chief Financial Officer since February 2007 and Executive Vice President and Chief Financial Officer since January 2011.  Mr. Sargen previously held the position of Vice President, Finance.  Previously, he was with Exp@nets, Inc. from 1999 through 2002, serving in the roles of Executive Vice President, Finance/Chief Financial Officer and Vice President/Corporate Controller.  From 1996 to 1998, he was with Fisher Scientific International’s Chemical Manufacturing Division, serving in the roles of Vice President, Finance and Controller.  Mr. Sargen has also held various positions in finance, accounting and audit with Merck & Company, Inc., Heat and Control, Inc., and Deloitte & Touche.

The remaining information required by this item will be included in the 2015 Proxy Statement and is incorporated herein by reference.

Item 11 Executive Compensation.

The remaining information required by this item will be included in the 2015 Proxy Statement and is incorporated herein by reference.

Item 12 Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

The remaining information required by this item will be included in the 2015 Proxy Statement and is incorporated herein by reference.

Item 13 Certain Relationships and Related Transactions and Director Independence.

The remaining information required by this item will be included in the 2015 Proxy Statement and is incorporated herein by reference.

Item 14 Principal Accountant Fees and Services.

The remaining information required by this item will be included in the 2015 Proxy Statement and is incorporated herein by reference.

80

PART IV

Item 15 Exhibits and Financial Statement Schedules.

(a) 1.The following consolidated financial statements of the Company are filed as part of this report:

	Page Number (in this report)
Financial Statements:
Reports of Independent Registered Public Accounting Firm	37
Consolidated Balance Sheets as of December 31, 2014 and 2013	39
Consolidated Income Statements for the Years Ended December 31, 2014, 2013 and 2012	40
Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2014, 2013 and 2012	41
Consolidated Statements of Stockholders’ Equity for the Years Ended December 31, 2014, 2013 and 2012	42
Consolidated Statements of Cash Flows for the Years Ended December 31, 2014, 2013 and 2012	43
Notes to Consolidated Financial Statements	44
Selected Quarterly Financial and Supplementary Data (unaudited)	76

2.(i)  The following schedule to the consolidated financial statements of the Company as filed herein and the Report of Independent Registered Public Accounting Firms are filed as part of this report.

	Page Number (in this report)
Schedule II – Valuation and Qualifying Accounts	82

All other schedules are omitted because they are not applicable or not required or because the required information is included in the consolidated financial statements of the Company or the notes thereto.

3.The exhibits filed in this report are listed in the Exhibit Index on pages 84-87.

81

SCHEDULE II

CAMBREX CORPORATION

VALUATION AND QUALIFYING ACCOUNTS

FOR THE YEARS ENDED DECEMBER 31, 2014, 2013 and 2012

(dollars in thousands)

Column A	Column B		Column C						Column D		Column E
			Additions
	Balance Beginning of Year		Charged/ (Credited) to Cost and Expenses			Charged/ (Credited) to Other Accounts			Deductions		Balance End of Year
Description
Year ended December 31, 2014:
Doubtful trade receivables and returns and allowances	$	1,058	$	61		$	(130	)	$	643	$	346
Deferred tax valuation allowance		29,890		(26,543	)		1,706			-		5,053
Year ended December 31, 2013:
Doubtful trade receivables and returns and allowances	$	652	$	433		$	27		$	54	$	1,058
Deferred tax valuation allowance		29,941		(97	)		46			-		29,890
Year ended December 31, 2012:
Doubtful trade receivables and returns and allowances	$	450	$	193		$	12		$	3	$	652
Deferred tax valuation allowance		77,571		(45,105	)		(2,525	)		-		29,941

82

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

CAMBREX CORPORATION
By	/s/ Gregory P. Sargen
	Gregory P. Sargen
Executive Vice President and Chief Financial Officer
Date:  February 6, 2015

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature		Title	Date
/s/	STEVEN M. KLOSK	President and Chief Executive Officer,	February 6, 2015
	Steven M. Klosk	and Director
/s/	GREGORY P. SARGEN	Executive Vice President andChief Financial	February 6, 2015
	Gregory P. Sargen	Officer (Principal Financial Officer
		and Accounting Officer)
/s/	SHLOMO YANAI
	Shlomo Yanai	Chairman of the Board of Directors	February 6, 2015
/s/	ROSINA B.DIXON	Director	February 6, 2015
	Rosina B. Dixon, M.D
/s/	KATHRYN RUDIE HARRIGAN	Director	February 6, 2015
	Kathryn Rudie Harrigan, PhD
/s/	LEON J. HENDRIX, JR.	Director	February 6, 2015
	Leon J. Hendrix, Jr.
/s/	ILAN KAUFTHAL	Director	February 6, 2015
	Ilan Kaufthal
/s/	WILLIAM KORB	Director	February 6, 2015
	William Korb
/s/	PETER G. TOMBROS	Director	February 6, 2015
	Peter G. Tombros
/s/	JAMES F. WINSCHEL, JR	Director	February 6, 2015
	James F. Winschel, Jr.

83

EXHIBIT INDEX

Exhibit No.		Description
2.1	--	Agreement for the sale and purchase of the entire issued share capital in each of Zenara Pharma Limited and Zenara Pharma Private Limited dated November 2, 2010, between Camzena Holdings Limited, NuLife (Cyprus) Limited, Ashok Srinivasan Narasimhan, Pradip Khodidas Dhamecna, Cambrex Corporation, Zenara Pharma Limited and Zenara Pharma Private Limited.(W).
2.2	--	Asset purchase agreement dated as of August 7, 2003 between Rutherford Acquisition Corporation and Cambrex Corporation and The Sellers listed in the asset Purchase agreement.(U).
2.3	--	Stock Purchase Agreement dated October 23, 2006 between Lonza America Inc., Lonza Bioproducts AG, Lonza Sales AG, Lonza Group Limited and Cambrex Corporation and Subsidiaries.(P – Exhibit 10.1).
3.1	--	Restated Certificate of Incorporation of Registrant, as amended.(AA).
3.2	--	By Laws of registrant, as amended.(AA).
4.1	--	Form of Certificate for shares of Common Stock of registrant.(A ‑ Exhibit 4(a)).
10.1	--	2009 Long-Term Incentive Plan (as amended and restated as of April 25, 2013).(F).
10.2	--	Directors’ Compensation Program.(Q).
10.3	--	Form of Non-Employee Directors Stock Option Agreement.(F).
10.4	--	William H. Haskel Offer of Employment Letter dated June 3, 2011.(Z).
10.5	--	Form of Performance Share Agreement.(DD).
10.7	--	Credit Agreement dated November 2, 2011 between Cambrex Corporation, the subsidiary borrowers party hereto, the subsidiary guarantors party hereto, the lenders party hereto and JP Morgan Chase Bank, N.A., as Administrative Agent.(R).
10.8	--	Settlement Agreement and Release and Environmental Escrow Agreement dated July 30, 2007 between Rutherford Chemicals LLC, Vertellus Specialties Holdings UK Ltd. (formerly Rutherford Chemicals UK Ltd.), Vertellus Specialties UK Ltd. (formerly Seal Sands Chemicals Ltd.), and Vertellus Specialties Holdings Corp. (formerly Rutherford Chemicals Holdings Corp.), and Cambrex Corporation, Nepera, Inc., CasChem Inc., Zeeland Chemicals, Inc., Nepcam, Inc., and Cambrex Ltd.(V).
10.9	--	Shawn P. Cavanagh Offer of Employment Letter.(X).
10.10	--	Supplemental Executive Retirement Plan Change of Control Amendment.(T).
10.11	--	Employment Agreement dated January 17, 2011 between the registrant and Shawn P. Cavanagh.(X).
10.12	--	1994 Stock Option Plan.(C).
10.13	--	1996 Performance Stock Option Plan.(G).
10.14	--	1998 Performance Stock Option Plan.(H).
10.15	--	2000 Employee Performance Stock Option Plan.(H).
10.16	--	Cambrex Corporation Savings Plan.(B).
10.17	--	Cambrex Corporation Supplemental Retirement Plan.(D).
10.18	--	Employment Agreement dated February 6, 2007 between the registrant and Gregory P. Sargen.(S).
10.19	--	Deferred Compensation Plan of Cambrex Corporation (as amended and restated as of March 1, 2001).(M).
10.20	--	Employment Agreement dated February 6, 2007 between the registrant and Paolo Russolo.(S).
10.21	--	2001 Performance Stock Option Plan.(I).
10.22	--	2003 Performance Stock Option Plan.(I).
10.23	--	2004 Performance Incentive Plan.(J).
10.24	--	Directors’ Common Stock Fee Payment Plan.(J).
10.25	--	2004 Incentive Plan.(L).

84

10.26	--	Administrative Consent Order dated September 16, 1985 of the New Jersey Department of Environmental Protection to Cosan Chemical Corporation.(A – Exhibit 10(Q)).
10.28	--	Agreement to Lift Sales Restrictions on Certain Vested Options.(N).
10.29	--	Agreement to Accelerate Vesting of Certain Options.(O).
10.30	--	Form of Stock Option Agreement.(EE).
10.31	--	Form of Performance Share Unit Agreement.(CC).
10.32	--	Employment Agreement with William M. Haskel.(Z).
10.33	--	Executive Cash Incentive Plan.(BB).
10.34	--	2012 Equity Incentive Plan for Non-Employee Directors.(BB).
21	--	Subsidiaries of registrant.(E).
23	--	Consent of BDO USA, LLP to the incorporation by reference of its report herein in Registration Statement Nos. 333-166260, 333-57404, 333-22017, 33-21374, 33-81782, 333-113612, 333-113613, 333-129473, 333-136529, 333-174124 and 333-181053 on Form S-8 of the registrant.(E).
31.1	--	CEO Certification pursuant to Rule 13a – 14(a) and Rule 15d – 14(a) of the Securities Exchange Act, as amended.(E).
31.2	--	CFO Certification pursuant to Rule 13a – 14(a) and Rule 15d – 14(a) of the Securities Exchange Act, as amended.(E).
32	--	CEO and CFO Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.(K).
101.INS	--	XBRL Instance Document.(E)(Y).
101.SCH	--	XBRL Taxonomy Extension Schema.(E)(Y).
101.CAL	--	XBRL Taxonomy Extension Calculation Linkbase.(E)(Y).
101.DEF	--	XBRL Taxonomy Extension Definition Linkbase.(E)(Y).
101.LAB	--	XBRL Taxonomy Extension Label Linkbase.(E)(Y).
101.PRE	--	XBRL Taxonomy Extension Presentation Linkbase.(E)(Y).

See legend on following page

85

EXHIBIT INDEX

(A) Incorporated by reference to the indicated Exhibit to registrant's Registration Statement on Form S‑1 (Registration No. 33‑16419).

(B) Incorporated by reference to registrant's Registration Statement on Form S-8 (Registration No. 33-81780) dated July 20, 1994.

(C) Incorporated by reference to registrant's Registration Statement on Form S-8 (Registration No. 33-81782) dated July 20, 1994.

(D) Incorporated by reference to the registrant's Annual Report on Form 10-K for 1994.

(E) Filed herewith.

(F) Incorporated by reference to the registrant’s Quarterly Report on Form 10-Q for the period ending March 31, 2013.

(G) Incorporated by reference to registrant’s Registration Statement on Form S-8 (Registration No. 333-22017) dated February 19, 1997.

(H) Incorporated by reference to registrant’s Registration Statement on Form S-8 (Registration No. 333-57404) dated March 22, 2001.

(I) Incorporated by reference to registrant’s Registration Statement on Form S-8 (Registration No. 333-113612) dated March 15, 2004.

(J) Incorporated by reference to registrant’s Registration Statement on Form S-8 (Registration No. 333-113613) dated March 15, 2004.

(K) Furnished herewith.

(L) Incorporated by reference to registrant’s Registration Statement on Form S-8 (Registration No. 333-129473) dated November 4, 2005.

(M) Incorporated by reference to registrant’s Annual Report on Form 10-K for year end 2005 filed May 26, 2006.

(N) Incorporated by reference to registrant’s Current Report on Form 8-K dated November 7, 2006.

(O) Incorporated by reference to registrant’s Current Report on Form 8-K dated June 7, 2005.

(P) Incorporated by reference to registrant’s Current Report on Form 8-K filed October 24, 2006.

(Q) Incorporated by reference to registrant’s Annual Report on Form 10-K filed February 11, 2010.

(R) Incorporated by reference to registrant’s Quarterly Report on Form 10-Q for the period ending September 30, 2011.

(S) Incorporated by reference to registrant’s Annual Report on Form 10-K for year end 2006 filed on March 15, 2007.

(T) Incorporated by reference to registrant’s Quarterly Report on Form 10-Q for the period ending June 30, 2008.

(U) Incorporated by reference to the registrant’s Current Report on Form 8-K dated November 10, 2003.

(V) Incorporated by reference to registrant’s Quarterly Report on Form 10-Q for the period ending September 30, 2007.

(W) Incorporated by reference to the registrant’s Current Report on Form 8-K dated November 4, 2010.

(X) Incorporated by reference to the registrant’s Current Report on Form 8-K dated January 13, 2011.

86

(Y) Attached as Exhibit 101 to this report are the following formatted in XBRL (Extensible Business Reporting Language): (i) Consolidated Balance Sheets as of December 31, 2013 and 2012, (ii) Consolidated Income Statements for the years ended December 31, 2013, 2012 and 2011, (iii) Consolidated Statements of Comprehensive Income for the years ended December 31, 2013, 2012 and 2011, (iv) Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2013, 2012 and 2011, (v) Consolidated Statement of Cash Flows for the years ended December 31, 2013, 2012 and 2011, and (vi) Notes to Consolidated Financial Statements.

(Z) Incorporated by reference to the registrant’s Current Report on Form 8-K dated June 24, 2011.

(AA) Incorporated by reference to the registrant’s Current Report on Form 8-K dated April 30, 2012.

(BB) Incorporated by reference to the registrant’s Quarterly Report on Form 10-Q for the period ending March 31, 2012.

(CC) Incorporated by reference to the registrant’s Quarterly Report on Form 10-Q for the period ending June 30, 2012.

(DD) Incorporated by reference to the registrant’s Annual Report on Form 10-K for year end 2012 filed on February 7, 2013.

(EE) Incorporated by reference to the registrant’s Quarterly Report on Form 10-Q for the period ending June 30, 2013.

87

EX-21

CAMBREX CORPORATION

EXHIBIT 21

Subsidiaries of Registrant

Subsidiary	Incorporated in:
Cambrex Charles City, Inc.	Iowa
Cambrex Profarmaco Milano S.r.l.	Italy
Cambrex Karlskoga AB	Sweden
AS Cambrex Tallinn	Estonia
Cambrex IEP GmbH	Germany
Zenara Pharma Private Limited	India

EX-23

CAMBREX CORPORATION

EXHIBIT 23

Consent of Independent Registered Public Accounting Firm

We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (No. 333-166260, 333-57404, 333-22017, 33-21374, 33-81782, 333-113612, 333-113613, 333-129473, 333-136529, 333-174124, 333-181053 and 333-190305) of Cambrex Corporation of our reports dated February 6, 2015, relating to the consolidated financial statements and schedule, and the effectiveness of Cambrex Corporation’s internal control over financial reporting, which appear in this Annual Report on Form 10-K.

/s/ BDO USA, LLP

Woodbridge, New Jersey

February 6, 2015

EX-31.1

Exhibit 31.1

Cambrex Corporation

Certification Pursuant to Rule 13a – 14(a) and Rule 15d – 14(a)

of the Securities Exchange Act, as Amended

I, Steven M. Klosk, certify that:

1. I have reviewed this annual report on Form 10-K of Cambrex Corporation;

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 annual 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:  February 6, 2015
	/s/ Steven M. Klosk
	Steven M. Klosk
	President and Chief Executive Officer

EX-31.2

Exhibit 31.2

Cambrex Corporation

Certification Pursuant to Rule 13a – 14(a) and Rule 15d – 14(a)

of the Securities Exchange Act, as Amended

I, Gregory P. Sargen, certify that:

1. I have reviewed this annual report on Form 10-K of Cambrex Corporation;

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 annual 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:  February 6, 2015
	/s/ Gregory P. Sargen
	Gregory P. Sargen
	Executive Vice President and Chief Financial Officer

EX-32

Exhibit 32

CAMBREX CORPORATION

Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Annual Report of Cambrex Corporation (the “Company”) on Form 10-K for the period ending December 31, 2014, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), each of the undersigned officers of the Company certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to his respective knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Steven M. Klosk

Steven M. Klosk

President and Chief Executive Officer

/s/ Gregory P. Sargen

Gregory P. Sargen

Executive Vice President and Chief Financial Officer

Dated:  February 6, 2015

XML

Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2014

Fair Value Measurements [Abstract]

Assets and liabilities carried at fair value measured on recurring basis

The following tables provide the assets and liabilities carried at fair value, measured on a recurring basis, as of December 31, 2014 and 2013:

				Fair Value Measurements at December 31, 2014 using:
Description	Total			Level 1		Level 2			Level 3
Foreign currency forwards, liabilities	$	(102	)	$	-	$	(102	)	$	-
Interest rate swap, liabilities		(304	)		-		(304	)		-
Total	$	(406	)	$	-	$	(406	)	$	-
				Fair Value Measurements at December 31, 2013 using:
Description	Total			(Level 1)		(Level 2)			(Level 3)
Interest rate swap, liabilities	$	(616	)	$	-	$	(616	)	$	-
Total	$	(616	)	$	-	$	(616	)	$	-

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Income Taxes (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended	12 Months Ended			9 Months Ended
	Dec. 31, 2014	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012	Sep. 30, 2014
Income/(loss) before income taxes [Abstract]
Domestic		$ 37,211	$ 23,068	$ 13,525
International		8,295	21,939	17,843
Income before income taxes		45,506	45,007	31,368
Current [Abstract]
Federal		2,572	630	(177)
State		0	15	4
International		512	5,980	8,525
Current, Total		3,084	6,625	8,352
Deferred [Abstract]
Federal		(14,965)	7,014	(36,287)
International		(746)	1,093	(3,926)
Deferred, Total		(15,711)	8,107	(40,213)
Total		(12,627)	14,732	(31,861)
Statutory federal income tax rate (in hundredths)		35.00%	35.00%	35.00%
Provision for income taxes differs from the statutory federal income tax rate [Abstract]
Income tax provision at U.S federal statutory rate		15,927	15,752	10,979
Effect of foreign income taxed at rates other than the U.S. federal statutory rate		751	242	(451)
Foreign income inclusions		2,742	0	4,563
Tax credits		(2,692)	(250)	(177)
Change in tax laws		0	(1,155)	(1,329)
Tax audit settlements	(3,948)	(3,948)	0	0
Net change in valuation allowance		(26,543)	(97)	(45,105)
Permanent items and other		1,136	240	(341)
Total		(12,627)	14,732	(31,861)
Deferred tax assets [Abstract]
Inventory	3,313	3,313	2,510
Foreign tax credit carryforwards	19,925	19,925	31,463
Environmental	2,993	2,993	2,995
Net operating loss carryforwards (foreign)	3,381	3,381	944
Employee benefits	18,879	18,879	12,841
Research & experimentation tax credit carryforwards	480	480	1,900
Alternative minimum tax credit carryforwards	2,773	2,773	2,773
Property, plant and equipment	3,898	3,898	3,843
Other	5,605	5,605	4,037
Total gross deferred tax assets	61,247	61,247	63,306
Valuation allowances	(5,053)	(5,053)	(29,890)
Total deferred tax assets	56,194	56,194	33,416
Deferred tax liabilities [Abstract]
Property, plant and equipment	(9,649)	(9,649)	(9,059)
Intangibles and other	(10,487)	(10,487)	(9,856)
Unremitted foreign earnings	(726)	(726)	(568)
Foreign tax allocation reserve	(1,856)	(1,856)	(2,006)
Other	(1,978)	(1,978)	(2,187)
Total deferred tax liabilities	(24,696)	(24,696)	(23,676)
Net deferred tax asset	31,498	31,498	9,740
Classified as follows in the consolidated balance sheet: [Abstract]
Current deferred tax asset (included in other current assets)	3,808	3,808	2,874
Non-current deferred tax asset	38,424	38,424	19,799
Current deferred tax liability (included in other current liabilities)	(189)	(189)	(98)
Non-current deferred tax liability	(10,545)	(10,545)	(12,835)
Operating Loss Carryforwards [Line Items]
Foreign earnings repatriated		5,442		8,953
Valuation Allowance [Line Items]
Net change in valuation allowance		(26,543)	(97)	(45,105)
Activity related to the entity's unrecognized tax benefits [Roll Forward]
Balance at January 1		3,922	3,967	4,328	3,922
Gross increases related to current period tax positions		275	257	348
Gross decreases related to prior period tax positions		(1,149)	(427)	(483)
Expirations of statute of limitations for the assessment of taxes		(106)	(37)	(113)
Settlements		(1,113)	0	(175)
Foreign currency translation		(186)	162	62
Balance at December 31	1,643	1,643	3,922	3,967
Unrecognized tax benefits that would affect effective tax rate	1,643	1,643
Gross interest and penalties related to unrecognized tax benefits	489	489	5,005	4,511
Interest and penalties		337	219	985
Income Tax Contingency [Line Items]
Potential future increase/(decrease) to unrecognized tax benefits	250	250
Amount of tax and interest paid as final settlement to the tax authority	1,487	1,487
Decrease in unrecognized tax benifits	4,137
Foreign Valuation Allowance [Member]
Provision for income taxes differs from the statutory federal income tax rate [Abstract]
Net change in valuation allowance		1,923	(48)	(140)
Valuation Allowance [Line Items]
Net change in valuation allowance		1,923	(48)	(140)
Domestic Gains and Losses Included in OCI and Discontinued Operations [Member]
Provision for income taxes differs from the statutory federal income tax rate [Abstract]
Net change in valuation allowance			(2,543)
Valuation Allowance [Line Items]
Net change in valuation allowance			(2,543)
Domestic Valuation Allowance [Member]
Provision for income taxes differs from the statutory federal income tax rate [Abstract]
Net change in valuation allowance		(26,760)	(3)	(47,490)
Valuation Allowance [Line Items]
Net change in valuation allowance		(26,760)	(3)	(47,490)
Foreign Gains and Losses Related to Deferred Taxes and Currency Translation Adjustments Included in OCI [Member]
Provision for income taxes differs from the statutory federal income tax rate [Abstract]
Net change in valuation allowance		1,706	46	18
Valuation Allowance [Line Items]
Net change in valuation allowance		1,706	46	18
Domestic Valuation Allowance Release of Valuation Allowance Due to Profitability [Member]
Provision for income taxes differs from the statutory federal income tax rate [Abstract]
Net change in valuation allowance		26,902		(36,287)
Valuation Allowance [Line Items]
Net change in valuation allowance		26,902		(36,287)
Foreign Valuation Allowance Change for Income Loss [Member]
Provision for income taxes differs from the statutory federal income tax rate [Abstract]
Net change in valuation allowance		217	(94)	(158)
Valuation Allowance [Line Items]
Net change in valuation allowance		217	(94)	(158)
Domestic Valuation Allowance Change for Income Loss [Member]
Provision for income taxes differs from the statutory federal income tax rate [Abstract]
Net change in valuation allowance		142		(8,660)
Valuation Allowance [Line Items]
Net change in valuation allowance		142		(8,660)
Valuation allowance against foreign tax credits [Member]
Provision for income taxes differs from the statutory federal income tax rate [Abstract]
Net change in valuation allowance		11,719			15,183
Valuation Allowance [Line Items]
Net change in valuation allowance		11,719			15,183
Foreign Operating Loss Carryforward [Member]
Operating Loss Carryforwards [Line Items]
Operating loss carryforwards	11,323	11,323
Foreign Operating Loss Acquired In 2014 [Member]
Operating Loss Carryforwards [Line Items]
Acquired operating loss carryforwards	$ 8,778	$ 8,778

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Acquisition (Details) (USD $) In Thousands, unless otherwise specified	1 Months Ended	3 Months Ended	12 Months Ended
	May 31, 2014	Jun. 30, 2014	Dec. 31, 2014
Business Acquisition [Line Items]
Goodwill acquired during the period			$ 9,715
Zenara Pharma [Member]
Business Acquisition [Line Items]
Business acquisition (in hundredths)	49.00%
Business acquisition, purchase price negotiated	2,680
Identifiable net liabilities	(655)
Finite lived intangible assets acquired	4,900	4,900
Deferred tax liability related to the intangible asset	1,666
Goodwill acquired during the period	9,715		9,715
Acquisition related costs			$ 460

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Long-term Debt (Details) (USD $) In Thousands, unless otherwise specified	1 Months Ended	12 Months Ended
	Nov. 30, 2011	Dec. 31, 2014	Dec. 31, 2013
Line of Credit Facility [Line Items]
Weighted average interest rate of long-term bank debt (in hundredths)		2.40%	2.30%
Syndicated Senior Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Borrowing capacity	$ 250,000
Term of revolving credit facility	5 years
Expiration date of revolving credit facility	Nov. 30, 2016
Variable rate of credit facility		LIBOR
Outstanding credit facility		$ 60,000	$ 79,250
Syndicated Senior Revolving Credit Facility [Member] | Minimum [Member]
Line of Credit Facility [Line Items]
Basis spread (in hundredths)		1.50%
Syndicated Senior Revolving Credit Facility [Member] | Maximum [Member]
Line of Credit Facility [Line Items]
Basis spread (in hundredths)		2.10%

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The Company (Details)	12 Months Ended
	Dec. 31, 2014 Segment
The Company [Abstract]
Number of operating segments	3
Number of reportable segments	1

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Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2014

Summary of Significant Accounting Policies [Abstract]

Schedule of estimated useful lives for each asset group

Plant and equipment are depreciated on a straight‑line basis over the estimated useful lives for each applicable asset group as follows:

Buildings and improvements	20 to 30 years, or term of lease if applicable
Machinery and equipment	7 to 15 years
Furniture and fixtures	5 to 7 years
Computer hardware and software	3 to 7 years

Components of accumulated other comprehensive loss in stockholders' equity

The components of accumulated other comprehensive loss in stockholders’ equity are as follows:

	2014			2013
Foreign currency translation	$	(11,410	)	$	9,990
Unrealized loss on hedging contracts, net of tax		(193	)		(396	)
Pensions, net of tax		(33,378	)		(28,556	)
Total	$	(44,981	)	$	(18,962	)

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Fair Value Measurements (Details) (Measured on a Recurring Basis [Member], USD $) In Thousands, unless otherwise specified	Dec. 31, 2014	Dec. 31, 2013
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Foreign currency forwards, liabilities	$ (102)
Interest rate swap, liabilities	(304)	(616)
Total	(406)	(616)
(Level 1) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Foreign currency forwards, liabilities	0
Interest rate swap, liabilities	0	0
Total	0	0
(Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Foreign currency forwards, liabilities	(102)
Interest rate swap, liabilities	(304)	(616)
Total	(406)	(616)
(Level 3) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Foreign currency forwards, liabilities	0
Interest rate swap, liabilities	0	0
Total	$ 0	$ 0

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Foreign Operations and Sales

12 Months Ended

Dec. 31, 2014

Foreign Operations and Sales [Abstract]

Foreign Operations and Sales

(18) Foreign Operations and Sales

The following summarized data represents the gross sales and long lived assets for the Company’s domestic and foreign entities for 2014, 2013 and 2012:

	Domestic		Foreign		Total
2014
Gross sales	$	186,735	$	187,415	$	374,150
Long-lived assets		64,995		151,386		216,381
2013
Gross sales	$	153,202	$	164,010	$	317,212
Long-lived assets		59,496		155,151		214,647
2012
Gross sales	$	109,729	$	168,202	$	277,931
Long-lived assets		44,085		149,133		193,218

Export sales, included in domestic gross sales, in 2014, 2013 and 2012 amounted to $101,101, $86,850, and $32,872, respectively.

Sales to geographic area consist of the following:

	2014		2013		2012
Europe	$	232,894	$	210,463	$	150,678
North America		117,477		86,974		105,439
Asia		12,865		13,800		12,827
Other		10,914		5,975		8,987
Total	$	374,150	$	317,212	$	277,931

One customer accounted for 24.0% and 18.3% of 2014 and 2013 consolidated gross sales, respectively, and another customer accounted for 12.5% of 2012 consolidated gross sales.

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Property, Plant and Equipment (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Schedule of Property, plant and equipment [Abstract]
Land	$ 4,117	$ 4,312
Buildings and Improvements	103,083	108,460
Machinery and equipment	365,623	398,490
Furniture and fixtures	1,821	1,884
Construction in progress	20,085	16,808
Total	494,729	529,954
Accumulated depreciation	(331,162)	(357,988)
Net	163,567	171,966
Depreciation expense	23,296	22,218	21,528
Total capital expenditures	$ 29,898	$ 41,600

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Retirement Plans (Tables)

12 Months Ended

Dec. 31, 2014

Retirement Plans [Abstract]

Benefit obligations

The benefit obligations as of December 31, 2014 and 2013 are as follows:

	Pension Plans
	Domestic						SERP						International
	2014			2013			2014			2013			2014			2013
Change in benefit obligation
Benefit obligation, beginning of year	$	70,709		$	79,958		$	3,086		$	3,690		$	25,627		$	27,033
Service cost		-			-			-			-			674			743
Interest cost		3,310			3,057			33			41			884			658
Actuarial loss/(gain)		11,813			(8,269	)		2			(9	)		5,319			(2,314	)
Benefits paid		(3,160	)		(4,037	)		(732	)		(636	)		(763	)		(808	)
Currency translation affect		-			-			-			-			(5,041	)		315
Settlements		(17,847	)		-			-			-			-			-
Benefit obligation, end of year	$	64,825		$	70,709		$	2,389		$	3,086		$	26,700		$	25,627

Plan assets and funded status of the Domestic Pension Plan

The plan assets and funded status of the Domestic Pension Plan as of December 31, 2014 and 2013 are as follows:

	2014			2013
Change in plan assets
Fair value of plan assets, beginning of period	$	57,743		$	53,900
Actual return on plan assets		2,605			6,894
Contributions		2,324			986
Benefits paid		(3,160	)		(4,037	)
Settlements		(17,847	)		-
Fair value of plan assets, end of period	$	41,665		$	57,743
Unfunded status		(23,160	)		(12,966	)
Accrued benefit cost, end of period	$	(23,160	)	$	(12,966	)

Amounts recognized in AOCI

The amounts recognized in AOCI as of December 31, 2014 and 2013 consist of the following:

	Pension Plans
	Domestic				SERP				International
	2014		2013		2014		2013		2014			2013
Actuarial loss	$	26,042	$	20,373	$	702	$	830	$	9,597		$	4,765
Prior service cost/(benefit)		-		-		172		230		(17	)		(24	)
Total	$	26,042	$	20,373	$	874	$	1,060	$	9,580		$	4,741

Components of net periodic benefit cost

The components of net periodic benefit cost are as follows:

	Pension Plans
	Domestic									SERP						International
	2014			2013			2012			2014		2013		2012		2014			2013			2012
Components of net periodic benefit cost
Service cost	$	-		$	-		$	-		$	-	$	-	$	-	$	674		$	743		$	660
Interest cost		3,310			3,057			3,284			33		41		85		884			658			795
Expected return on plan assets		(4,153	)		(3,826	)		(3,674	)		-		-		-		-			-			-
Amortization of prior service cost/(benefit)		-			-			60			57		57		57		(7	)		(7	)		(7	)
Recognized actuarial loss		522			937			864			131		118		76		149			284			200
Settlement loss		7,170			-			-			-		-		-		-			-			-
Net periodic benefit cost	$	6,849		$	168		$	534		$	221	$	216	$	218	$	1,700		$	1,678		$	1,648

Estimated amounts that will be amortized from AOCI into net periodic benefit cost in 2014

The estimated amounts that will be amortized from AOCI into net periodic benefit cost in 2015 are as follows:

	Pension Plans
	Domestic		SERP		International
Actuarial loss	$	811	$	154	$	359
Prior service cost/(benefit)		-		57		(6	)
Total	$	811	$	211	$	353

Major assumptions used in determining the benefit obligations and net benefit cost

Major assumptions used in determining the benefit obligations are presented in the following table:

	2014	2013
Discount rate:
Domestic Pension Plan	3.85%	4.80%
SERP	1.35%	1.40%
International Pension Plan	2.40%	3.70%
Rate of compensation increase:
International Pension Plan	2.20%	2.50%

Major assumptions used in determining the net benefit cost are presented in the following table:

	2014	2013	2012
Discount rate:
Domestic Pension Plan	4.80%	3.90%	4.45%
SERP	1.40%	1.35%	2.40%
International Pension Plan	3.70%	3.40%	3.40%
Expected return on plan assets:
Domestic Pension Plan	7.25%	7.25%	7.50%
Rate of compensation increase:
International Pension Plan	2.20%	2.50%	2.40%

Expected benefit payments

The following benefit payments are expected to be paid out of the plans:

	Pension Plans
	Domestic		SERP		International
2015	$	3,429	$	609	$	689
2016	$	3,401	$	609	$	699
2017	$	3,470	$	609	$	709
2018	$	3,400	$	609	$	767
2019	$	3,482	$	-	$	824
2020-2024	$	18,054	$	-	$	4,865

Fair values of the Company's pension plan assets by asset category

The fair values of the Company’s pension plan assets by asset category are as follows:

			Fair Value Measurements at December 31, 2014 using:
Asset Category	Total		(Level 1)		(Level 2)		(Level 3)
Equity securities:
U.S. companies	$	14,513	$	-	$	14,513	$	-
International companies		7,900		-		7,900		-
U.S. fixed income		14,093		-		11,964		2,129
Commodities		3,161		-		3,161		-
TIPS		1,998		-		1,998		-
	$	41,665	$	-	$	39,536	$	2,129
			Fair Value Measurements at December 31, 2013 using:
Asset Category	Total		(Level 1)		(Level 2)		(Level 3)
Equity securities:
U.S. companies	$	20,633	$	-	$	20,633	$	-
International companies		11,157		-		11,157		-
U.S. fixed income		18,736		-		16,660		2,076
Commodities		4,436		-		4,436		-
TIPS		2,781		-		2,781		-
	$	57,743	$	-	$	55,667	$	2,076

Changes in the fair value of the Domestic Plan's Level 3 assets

The following table sets forth a summary of the changes in the fair value of the Domestic Plan’s Level 3 assets, which are annuity contracts with an insurance company, for the year ended December 31, 2014:

	Group Annuity Contract
Balance at December 31, 2013	$	2,076
Net investment gain		53
Balance at December 31, 2014	$	2,129

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Accrued Expense and Other Current Liabilities (Tables)

12 Months Ended

Dec. 31, 2014

Accrued Expenses And Other Current Liabilities [Abstract]

Components of accrued expenses and other current liabilities

The components of accrued expenses and other current liabilities are as follows:

	December 31,
	2014		2013
Salaries and employee benefits payable	$	26,893	$	26,211
Taxes payable and related reserves		5,420		10,168
Other		8,701		11,719
Total	$	41,014	$	48,098

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Partially-Owned Affiliates (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended	12 Months Ended			1 Months Ended
	Jun. 30, 2014	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012	May 31, 2014
Partially-Owned Affiliates [Abstract]
Net gain (loss) due to full consolidation	$ (4,122)
Entity's proportionate share of net income/(loss) from equity method investments		(4,623)	(2,262)	(1,766)
Advances to partially-owned affiliates		(1,404)	(1,655)	(2,047)
Zenara Pharma [Member]
Partially-Owned Affiliates [Abstract]
Business acquisition (in hundredths)					49.00%
Business acquisition, purchase price negotiated					2,680
Acquisition related costs		460
Equity ownership interest (in hundredths)		51.00%	51.00%	51.00%
Recognition of a gain		278
Foreign currency translation adjustment charged to expense		(4,400)
Net gain (loss) due to full consolidation		(4,122)
Entity's proportionate share of net income/(loss) from equity method investments		(458)	(1,956)	(1,976)
Entity's proportionate share of amortization expense from equity method investments		333	882	965
Entity's proportionate share of depreciation expense from equity method investments			130	132
Advances to partially-owned affiliates		$ (1,282)	$ (1,514)	$ (1,594)

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SELECTED QUARTERLY FINANCIAL AND SUPPLEMENTARY DATA - UNAUDITED (Details) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended																12 Months Ended
	Dec. 31, 2014		Sep. 30, 2014		Jun. 30, 2014		Mar. 31, 2014		Dec. 31, 2013		Sep. 30, 2013		Jun. 30, 2013		Mar. 31, 2013		Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Summary of selected quarterly financial and supplementary data [Abstract]
Gross Sales	$ 128,841	[1]	$ 81,145	[2]	$ 97,972	[3]	$ 66,192	[4]	$ 103,011		$ 77,992		$ 61,628		$ 74,581	[5]	$ 374,150	$ 317,212	$ 277,931
Net revenues	129,315	[1]	81,300	[2]	97,893	[3]	66,105	[4]	103,036		77,452		62,803		74,885	[5]	374,613	318,176	276,501
Gross profit	45,399	[1]	28,406	[2]	33,415	[3]	16,578	[4]	33,938		24,966		19,251		24,749	[5]	123,798	102,904	90,487
Income from continuing operations	28,258	[1]	8,882	[2]	19,827	[3]	1,166	[4]	9,440		6,274		3,136		11,425	[5]	58,133	30,275	63,229
Loss from discontinued operations (6)	(373)	[1],[6]	(113)	[2],[6]	(160)	[3],[6]	(184)	[4],[6]	(541)	[6]	(2,700)	[6]	(862)	[6]	(257)	[5],[6]	(830)	(4,360)	(926)
Net income	27,885	[1]	8,769	[2]	19,667	[3]	982	[4]	8,899		3,574		2,274		11,168	[5]	57,303	25,915	62,303
Earnings per share of common stock (7)[Abstract]
Basic (in dollars per share)	$ 0.90	[1],[7]	$ 0.28	[2],[7]	$ 0.64	[3],[7]	$ 0.03	[4],[7]	$ 0.29	[7]	$ 0.12	[7]	$ 0.07	[7]	$ 0.37	[5],[7]	$ 1.86	$ 0.86	$ 2.10
Diluted (in dollars per share)	$ 0.88	[1],[7]	$ 0.28	[2],[7]	$ 0.63	[3],[7]	$ 0.03	[4],[7]	$ 0.29	[7]	$ 0.12	[7]	$ 0.07	[7]	$ 0.36	[5],[7]	$ 1.81	$ 0.84	$ 2.06
Average shares [Abstract]
Basic (in shares)	31,053		30,801		30,647		30,546		30,353		30,184		30,089		29,970		30,763	30,150	29,703
Diluted (in shares)	31,803		31,599		31,428		31,408		31,166		31,052		30,956		30,788		31,643	30,901	30,314
Schedule Of Quarterly Financial Information [Line Items]
Deferred tax asset valuation allowance change in amount	11,719		824		14,161		198
Equity in losses of partially-owned					4,122
Gain on sale of an office building																	1,234	4,680	0
Benefit for tax audit settlements	3,948																3,948	0	0
Loss on voluntary pension settlement	7,170																7,170	0	0
Income tax benefit due to changes in tax laws															1,155
Land [Member]
Schedule Of Quarterly Financial Information [Line Items]
Gain on sale of an office building	1,234																1,234
Income tax expense on gain on sale of assets	387
Office Building [Member]
Schedule Of Quarterly Financial Information [Line Items]
Gain on sale of an office building															4,680			4,680
Income tax expense on gain on sale of assets															$ 1,470

[1] Income from continuing operations includes a gain on sale of land of $1,234 and a corresponding tax expense of $387, a benefit of $11,719 for the reversal of a valuation allowance on deferred tax assets, a benefit of $3,948 for favorable audit settlements, and expense of $7,170 related to a voluntary lump sum pension settlement.

[2] Income from continuing operations includes the reversal of a valuation allowance on deferred tax assets of $824.

[3] Income from continuing operations includes the reversal of a valuation allowance on deferred tax assets of $14,161 and a loss of $4,122 related to the purchase of the remaining shares in Zenara.

[4] Income from continuing operations includes the reversal of a valuation allowance on deferred tax assets of $198.

[5] Income from continuing operations includes a gain on sale of an office building of $4,680 and a corresponding tax expense of $1,470 and a benefit of $1,155 due to changes in tax laws.

[6] Discontinued operations include charges for environmental remediation related to sites of divested businesses.

[7] Earnings per share calculations for each of the quarters are based on the weighted average number of shares outstanding for each period. As such, the sum of the quarters may not necessarily equal the earnings per share amount for the year.

XML

Retirement Plans (Details) (USD $) In Thousands, except Share data, unless otherwise specified	1 Months Ended	3 Months Ended	12 Months Ended			3 Months Ended
	Jan. 31, 2009 Installment	Dec. 31, 2014	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012	Sep. 30, 2014
Defined Benefit Plan Disclosure [Line Items]
Number of actuarial equivalent installments	10
Cost of defined contribution plan			$ 941	$ 731	$ 733
Components of net periodic benefit cost [Abstract]
Settlement loss		7,170	7,170	0	0
Fair values of pension plan assets by asset category [Abstract]
Fair value of plan assets		41,665	41,665	57,743
Deferred Compensation Plan [Member]
Deferred Compensation Plan Disclosure [Line Items]
Obligation under deferred compensation plan included in other liabilities		932	932	1,049
Investment in mutual funds included in other assets		932	932	1,049
Common shares held in trust (in shares)		49,121	49,121	49,121
Common shares held in trust, value		1,062	1,062	876
(Level 1) [Member]
Fair values of pension plan assets by asset category [Abstract]
Fair value of plan assets		0	0	0
(Level 2) [Member]
Fair values of pension plan assets by asset category [Abstract]
Fair value of plan assets		39,536	39,536	55,667
(Level 3) [Member]
Fair values of pension plan assets by asset category [Abstract]
Fair value of plan assets		2,129	2,129	2,076
Domestic and International Equity Securities [Member]
Defined Benefit Plan, Assets, Target Allocations [Abstract]
Target plan asset allocations range minimum (in hundredths)			30.00%
Target plan asset allocations range maximum (in hundredths)			80.00%
Equity Securities U.S. Companies [Member]
Fair values of pension plan assets by asset category [Abstract]
Fair value of plan assets		14,513	14,513	20,633
Equity Securities U.S. Companies [Member] | (Level 1) [Member]
Fair values of pension plan assets by asset category [Abstract]
Fair value of plan assets		0	0	0
Equity Securities U.S. Companies [Member] | (Level 2) [Member]
Fair values of pension plan assets by asset category [Abstract]
Fair value of plan assets		14,513	14,513	20,633
Equity Securities U.S. Companies [Member] | (Level 3) [Member]
Fair values of pension plan assets by asset category [Abstract]
Fair value of plan assets		0	0	0
Equity Securities International Companies [Member]
Fair values of pension plan assets by asset category [Abstract]
Fair value of plan assets		7,900	7,900	11,157
Equity Securities International Companies [Member] | (Level 1) [Member]
Fair values of pension plan assets by asset category [Abstract]
Fair value of plan assets		0	0	0
Equity Securities International Companies [Member] | (Level 2) [Member]
Fair values of pension plan assets by asset category [Abstract]
Fair value of plan assets		7,900	7,900	11,157
Equity Securities International Companies [Member] | (Level 3) [Member]
Fair values of pension plan assets by asset category [Abstract]
Fair value of plan assets		0	0	0
U.S. fixed income [Member]
Defined Benefit Plan, Assets, Target Allocations [Abstract]
Target plan asset allocations range minimum (in hundredths)			25.00%
Target plan asset allocations range maximum (in hundredths)			45.00%
Fair values of pension plan assets by asset category [Abstract]
Fair value of plan assets		14,093	14,093	18,736
U.S. fixed income [Member] | (Level 1) [Member]
Fair values of pension plan assets by asset category [Abstract]
Fair value of plan assets		0	0	0
U.S. fixed income [Member] | (Level 2) [Member]
Fair values of pension plan assets by asset category [Abstract]
Fair value of plan assets		11,964	11,964	16,660
U.S. fixed income [Member] | (Level 3) [Member]
Fair values of pension plan assets by asset category [Abstract]
Fair value of plan assets		2,129	2,129	2,076
All other investments [Member]
Defined Benefit Plan, Assets, Target Allocations [Abstract]
Target plan asset allocations range minimum (in hundredths)			5.00%
Target plan asset allocations range maximum (in hundredths)			15.00%
Commodities [Member]
Fair values of pension plan assets by asset category [Abstract]
Fair value of plan assets		3,161	3,161	4,436
Commodities [Member] | (Level 1) [Member]
Fair values of pension plan assets by asset category [Abstract]
Fair value of plan assets		0	0	0
Commodities [Member] | (Level 2) [Member]
Fair values of pension plan assets by asset category [Abstract]
Fair value of plan assets		3,161	3,161	4,436
Commodities [Member] | (Level 3) [Member]
Fair values of pension plan assets by asset category [Abstract]
Fair value of plan assets		0	0	0
TIPS [Member]
Fair values of pension plan assets by asset category [Abstract]
Fair value of plan assets		1,998	1,998	2,781
TIPS [Member] | (Level 1) [Member]
Fair values of pension plan assets by asset category [Abstract]
Fair value of plan assets		0	0	0
TIPS [Member] | (Level 2) [Member]
Fair values of pension plan assets by asset category [Abstract]
Fair value of plan assets		1,998	1,998	2,781
TIPS [Member] | (Level 3) [Member]
Fair values of pension plan assets by asset category [Abstract]
Fair value of plan assets		0	0	0
Domestic [Member]
Change in benefit obligation
Benefit obligation, beginning of year			70,709	79,958
Service cost			0	0	0
Interest cost			3,310	3,057	3,284
Actuarial loss/(gain)			11,813	(8,269)
Benefits paid			(3,160)	(4,037)
Currency translation affect			0	0
Settlements			(17,847)	0
Benefit obligation, end of year		64,825	64,825	70,709	79,958
Change in plan assets
Fair value of plan assets, beginning of period			57,743	53,900
Actual return on plan assets			2,605	6,894
Contributions			2,324	986
Benefits paid			(3,160)	(4,037)
Settlements			(17,847)	0		(17,381)
Fair value of plan assets, end of period		41,665	41,665	57,743	53,900
Unfunded status		(23,160)	(23,160)	(12,966)
Accrued benefit cost, end of period		(23,160)	(23,160)	(12,966)
Amounts recognized in AOCI [Abstract]
Actuarial loss		26,042	26,042	20,373
Prior service cost/(benefit)		0	0	0
Total		26,042	26,042	20,373
Components of net periodic benefit cost [Abstract]
Service cost			0	0	0
Interest cost			3,310	3,057	3,284
Expected return on plan assets			(4,153)	(3,826)	(3,674)
Amortization of prior service cost/(benefit)			0	0	60
Recognized actuarial loss			522	937	864
Settlement loss			7,170	0	0
Net periodic benefit cost			6,849	168	534
Estimated amounts that will be amortized from AOCI into net periodic benefit cost in 2015 [Abstract]
Actuarial loss			811
Prior service cost/(benefit)			0
Total			811
Major assumptions used in determining the benefit obligations [Abstract]
Discount rate (in hundredths)		3.85%	3.85%	4.80%
Major assumptions used in determining the net benefit cost [Abstract]
Discount rate (in hundredths)			4.80%	3.90%	4.45%
Expected return on plan assets (in hundredths)			7.25%	7.25%	7.50%
Aggregate accumulated benefit obligation		64,825	64,825
Aggregate ABO exceeds plan assets		23,160	23,160
Expected contribution in cash to Domestic Pension Plan in 2015			1,900
Benefit payments expected to be paid out of the plans [Abstract]
2015		3,429	3,429
2016		3,401	3,401
2017		3,470	3,470
2018		3,400	3,400
2019		3,482	3,482
2020-2024		18,054	18,054
Domestic [Member] | (Level 3) [Member]
Summary of the changes in the fair value of the Domestic Plans Level 3 assets [Abstract]
Fair value of plan assets, beginning of period			2,076
Net investment gain			53
Fair value of plan assets, end of period		2,129	2,129
SERP [Member]
Change in benefit obligation
Benefit obligation, beginning of year			3,086	3,690
Service cost			0	0	0
Interest cost			33	41	85
Actuarial loss/(gain)			2	(9)
Benefits paid			(732)	(636)
Currency translation affect			0	0
Settlements			0	0
Benefit obligation, end of year		2,389	2,389	3,086	3,690
Change in plan assets
Benefits paid			(732)	(636)
Unfunded status		(2,389)	(2,389)	(3,086)
Amounts recognized in AOCI [Abstract]
Actuarial loss		702	702	830
Prior service cost/(benefit)		172	172	230
Total		874	874	1,060
Components of net periodic benefit cost [Abstract]
Service cost			0	0	0
Interest cost			33	41	85
Expected return on plan assets			0	0	0
Amortization of prior service cost/(benefit)			57	57	57
Recognized actuarial loss			131	118	76
Settlement loss			0	0	0
Net periodic benefit cost			221	216	218
Estimated amounts that will be amortized from AOCI into net periodic benefit cost in 2015 [Abstract]
Actuarial loss			154
Prior service cost/(benefit)			57
Total			211
Major assumptions used in determining the benefit obligations [Abstract]
Discount rate (in hundredths)		1.35%	1.35%	1.40%
Major assumptions used in determining the net benefit cost [Abstract]
Discount rate (in hundredths)			1.40%	1.35%	2.40%
Benefit payments expected to be paid out of the plans [Abstract]
2015		609	609
2016		609	609
2017		609	609
2018		609	609
2019		0	0
2020-2024		0	0
International [Member]
Change in benefit obligation
Benefit obligation, beginning of year			25,627	27,033
Service cost			674	743	660
Interest cost			884	658	795
Actuarial loss/(gain)			5,319	(2,314)
Benefits paid			(763)	(808)
Currency translation affect			(5,041)	315
Settlements			0	0
Benefit obligation, end of year		26,700	26,700	25,627	27,033
Change in plan assets
Benefits paid			(763)	(808)
Unfunded status		(26,700)	(26,700)	(25,627)
Amounts recognized in AOCI [Abstract]
Actuarial loss		9,597	9,597	4,765
Prior service cost/(benefit)		(17)	(17)	(24)
Total		9,580	9,580	4,741
Components of net periodic benefit cost [Abstract]
Service cost			674	743	660
Interest cost			884	658	795
Expected return on plan assets			0	0	0
Amortization of prior service cost/(benefit)			(7)	(7)	(7)
Recognized actuarial loss			149	284	200
Settlement loss			0	0	0
Net periodic benefit cost			1,700	1,678	1,648
Estimated amounts that will be amortized from AOCI into net periodic benefit cost in 2015 [Abstract]
Actuarial loss			359
Prior service cost/(benefit)			(6)
Total			353
Major assumptions used in determining the benefit obligations [Abstract]
Discount rate (in hundredths)		2.40%	2.40%	3.70%
Rate of compensation increase (in hundredths)		2.20%	2.20%	2.50%
Major assumptions used in determining the net benefit cost [Abstract]
Discount rate (in hundredths)			3.70%	3.40%	3.40%
Rate of compensation increase (in hundredths)			2.20%	2.50%	2.40%
Aggregate accumulated benefit obligation		25,459	25,459
Benefit payments expected to be paid out of the plans [Abstract]
2015		689	689
2016		699	699
2017		709	709
2018		767	767
2019		824	824
2020-2024		$ 4,865	$ 4,865

XML

Summary of Significant Accounting Policies (Details) (USD $) In Thousands, except Share data, unless otherwise specified	12 Months Ended			1 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012	May 31, 2014
Cash Equivalents [Abstract]
Original maturity period of temporary cash investments considered as cash equivalents, maximum	3 months
Concentrations of credit risk [Abstract]
Account receivables from one customer (in hundredths)	38.00%	38.00%
Impairment of goodwill [Abstract]
Goodwill	$ 9,715
Property, Plant and Equipment [Abstract]
Total interest capitalized	128	298	0
Foreign Currency [Abstract]
Foreign currency net transaction gains/(losses)	186	(133)	(274)
Earnings per Common Share [Abstract]
Antidilutive securities excluded from computation of earnings per share (in shares)	940,038	916,350	580,745
Components of accumulated other comprehensive loss in stockholders' equity [Abstract]
Foreign currency translation	(11,410)	9,990
Unrealized loss on hedging contracts, net of tax	(193)	(396)
Pensions, net of tax	(33,378)	(28,556)
Total	(44,981)	(18,962)	(34,091)
Zenara Pharma [Member]
Impairment of goodwill [Abstract]
Goodwill	9,715			9,715
Minimum [Member]
Concentrations of credit risk [Abstract]
Cash balances with European Union banks	1,000
Minimum [Member] | Buildings and improvements [Member]
Property, Plant and Equipment [Abstract]
Estimated useful lives	20 years
Minimum [Member] | Machinery and equipment [Member]
Property, Plant and Equipment [Abstract]
Estimated useful lives	7 years
Minimum [Member] | Furniture and fixtures [Member]
Property, Plant and Equipment [Abstract]
Estimated useful lives	5 years
Minimum [Member] | Computer hardware and software [Member]
Property, Plant and Equipment [Abstract]
Estimated useful lives	3 years
Maximum [Member]
Concentrations of credit risk [Abstract]
Cash balances with European Union banks	$ 10,000
Maximum [Member] | Buildings and improvements [Member]
Property, Plant and Equipment [Abstract]
Estimated useful lives	30 years
Maximum [Member] | Machinery and equipment [Member]
Property, Plant and Equipment [Abstract]
Estimated useful lives	15 years
Maximum [Member] | Furniture and fixtures [Member]
Property, Plant and Equipment [Abstract]
Estimated useful lives	7 years
Maximum [Member] | Computer hardware and software [Member]
Property, Plant and Equipment [Abstract]
Estimated useful lives	7 years

XML

Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2014

Summary of Significant Accounting Policies [Abstract]

Summary of Significant Accounting Policies

(2) Summary of Significant Accounting Policies

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries.  Equity investments in which the Company exercises significant influence but does not control, are accounted for using the equity method.  The Company’s share of its equity method investees’ earnings or losses are included in “Other expenses/(income)” in the income statements. The Company eliminates its pro rata share of gross profit on sales with its equity method investees for assets still remaining in inventory at the end of the reporting period.  All other significant intercompany balances and transactions have been eliminated in consolidation.

Cash Equivalents

Temporary cash investments with an original maturity of less than three months are considered cash equivalents.  The carrying amounts approximate fair value.

Allowance for Doubtful Accounts

The Company maintains allowances for doubtful accounts relating to estimated losses resulting from customers being unable to make required payments.  Allowances for doubtful accounts are based on historical experience and known factors regarding specific customers and the industries in which those customers operate.  If the financial condition of the Company’s customers were to deteriorate, resulting in their inability to make payments, additional allowances would be required.

Concentrations of credit risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents and accounts receivable. In the normal course of business, the Company maintains cash balances with European Union banks ranging from the equivalent of $1,000 - $10,000. The Company routinely monitors the risks associated with these institutions and diversifies its exposure by maintaining smaller balances with multiple financial institutions.  Concentrations of credit risk with respect to accounts receivable are limited due to the Company's large number of customers and their dispersion throughout the world. At December 31, 2014 and 2013, the Company had receivables with one customer totaling nearly 38% of overall accounts receivables. The Company does not consider this customer to pose any significant credit risk.

Derivative Instruments

Derivative financial instruments are periodically used by the Company primarily to mitigate a variety of working capital, investment and borrowing risks.  The Company primarily uses foreign currency forward contracts to minimize foreign currency exchange rate risk associated with foreign currency transactions.  Changes in the fair value on these forward contracts are recognized in earnings.  The Company uses interest rate swap instruments only as hedges.  As such, the differential to be paid or received in connection with these instruments is accrued and recognized in income as an adjustment to interest expense.

None of the foreign currency forward contracts entered into during 2014 were designated for hedge accounting treatment. There were no foreign currency forward contracts entered into or outstanding in 2013.

Inventories

Inventories are stated at the lower of cost, determined on a first‑in, first‑out basis, or market.  The determination of market value involves assessment of numerous factors, including estimated selling prices.  Reserves are recorded to reduce the carrying value for inventory determined to be damaged, obsolete or otherwise unsaleable.

Property, Plant and Equipment

Property, plant and equipment is stated at cost, net of accumulated depreciation.  Plant and equipment are depreciated on a straight‑line basis over the estimated useful lives for each applicable asset group as follows:

Buildings and improvements	20 to 30 years, or term of lease if applicable
Machinery and equipment	7 to 15 years
Furniture and fixtures	5 to 7 years
Computer hardware and software	3 to 7 years

Expenditures for additions, major renewals or betterments are capitalized and expenditures for maintenance and repairs are charged to income as incurred.

When assets are retired or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts, and any resulting gain or loss is reflected in costs of goods sold or operating expenses.  Interest is capitalized in connection with the construction and acquisition of assets that are capitalized over longer periods of time for larger amounts.  The capitalized interest is recorded as part of the cost of the asset to which it relates and is amortized over the asset’s estimated useful life.  Total interest capitalized in connection with ongoing construction activities was $128 in 2014, $298 in 2013 and negligible in 2012.

Impairment of Goodwill

The Company reviews the carrying value of goodwill to determine whether impairment may exist on an annual basis or whenever it has reason to believe goodwill may not be recoverable.  The annual impairment test of goodwill is performed during the fourth quarter of each fiscal year. The Company did not have an impairment for any of the years presented.

Goodwill impairment is determined by the Company using a two-step process.  The first step of the goodwill impairment test is used to identify potential impairment by comparing the fair value of each reporting unit, determined using various valuation techniques, with the primary technique being a discounted cash flow analysis, to its carrying value.  If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired and the second step of the impairment test is unnecessary.  If the carrying amount of a reporting unit exceeds its fair value, the second step of the goodwill impairment test is performed to measure the amount of impairment loss, if any.  The second step of the goodwill impairment test compares the implied fair value of the reporting unit’s goodwill with the carrying amount of that goodwill.  If the carrying amount of the reporting unit’s goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized.

Based upon the Company’s  most recent analysis, with the exception of Zenara, the fair value of all other reporting units substantially exceeded their carrying values. Zenara, which was acquired during 2014, has an estimated fair value that closely approximates the carrying value.  The goodwill of Zenara was $9,715.  The Zenara business, based in India, has been in operation for a relatively short period of time compared to Cambrex’s other businesses, and competes with other low cost providers globally.  Cambrex’s current assumptions and those used at acquisition include adding a significant amount of new and profitable customers by utilizing Cambrex’s global sales force as well as making operational improvements to the business.  The business has few customers and is expected to operate at or slightly below breakeven in 2015.  Any negative changes in assumptions on new customers, volumes, or Cambrex’s ability to improve operations while maintaining a competitive cost structure could adversely affect the fair value of Zenara and result in significant goodwill or other long-lived asset impairment charges in 2015 or later.

Impairment of Long-Lived Assets

The Company assesses the impairment of its long-lived assets, including amortizable intangible assets, and property, plant and equipment, whenever economic events or changes in circumstances indicate that the carrying amounts of the assets may not be recoverable.  Long lived assets are considered to be impaired when the sum of the undiscounted expected future operating cash flows is less than the carrying amounts of the related assets.  If impaired, the assets are written down to fair market value.

The Company has investments in partially-owned affiliates.  It does not separately test an investee’s underlying assets for impairments but will recognize its share of any impairment charge recorded by an investee in earnings and consider the effect of the impairment on its investment.  A series of operating losses of an investee or other factors may indicate that a decrease in value of the investment has occurred that is other than temporary. A loss in value of an investment that is other than a temporary decline would be recognized as an impairment if the fair value of that investment is less than its carrying amount.

Revenue Recognition

Revenues are generally recognized when title to products and risk of loss are transferred to customers.  Additional conditions for recognition of revenue are that collection of sales proceeds is reasonably assured and the Company has no further performance obligations.

Amounts billed in advance are recorded as deferred revenue on the balance sheet. Since payments received are sometimes non-refundable, the termination of a contract by a customer prior to its completion could result in an immediate recognition of deferred revenue relating to payments already received but not previously recognized as revenue.

Sales terms to certain customers include rebates if certain conditions are met.  Additionally, sales are generally made with a limited right of return under certain conditions.  The Company estimates these rebates and returns at the time of sale based on the terms of agreements with customers and historical experience and recognizes revenue net of these estimated costs which are classified as allowances and rebates.

The Company bills a portion of freight cost incurred on shipments to customers.  Amounts billed to customers are recorded within net revenues.  Freight costs are reflected in cost of goods sold.

Income Taxes

The Company and its eligible subsidiaries file a consolidated U.S. income tax return.  Foreign subsidiaries are consolidated for financial reporting but are not eligible to be included in the consolidated U.S. income tax return, however the earnings of foreign subsidiaries are generally taxed by the U.S. when repatriated and such U.S. tax may be reduced or eliminated by federal foreign tax credits based on the foreign income and withholding taxes paid or accrued by the foreign subsidiary.  Historically, the Company intended to reinvest foreign earnings indefinitely outside of the U.S. and only considered repatriating excess cash from foreign subsidiaries if it could utilize fully valued domestic tax attributes to completely offset any tax expense that would otherwise result.  Unrecognized foreign tax credits and fully valued foreign tax credit carryovers were available to offset any potential U.S. tax liability.  Therefore, the Company had not provided U.S. federal income taxes or foreign withholding taxes on its undistributed earnings from foreign operations prior to 2012.  During the fourth quarter of 2012, the Company completed a detailed forecast of foreign source income by jurisdiction as part of the ongoing process to evaluate its valuation allowance against deferred tax assets.  As part of this process, as well as a continuing desire to limit its credit and currency exposure for cash held in foreign currencies or in non-U.S. banks, the Company determined that it is likely that a portion of the undistributed earnings of its foreign subsidiaries will be repatriated to the U.S. in the future. Accordingly, in 2012 the Company changed its indefinite reinvestment assertion and now provides deferred taxes on certain undistributed foreign earnings.  Subject to limitations, U.S. income tax on such foreign earnings, when actually repatriated, may be reduced or eliminated by unrecognized foreign tax credits that may be generated in connection with the repatriation or by existing foreign tax credit carryforwards or other tax attributes for which valuation allowance was released.  The Company monitors available evidence and its plans for foreign earnings and expects to continue to provide deferred taxes based on the tax liability that would be due upon repatriation of amounts not considered permanently reinvested.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

Environmental Costs

The Company is subject to extensive and changing federal, state, local and foreign environmental laws and regulations, and has made provisions for the estimated financial impact of environmental activities.  The Company’s policy is to accrue environmental related costs of a non-capital nature, including estimated litigation costs, when those costs are believed to be probable and can be reasonably estimated.  The quantification of environmental exposures requires an assessment of many factors, including changing laws and regulations, advancements in environmental technologies, the quality of information available related to specific sites, the assessment stage of each site investigation, preliminary findings and the length of time involved in remediation or settlement.  Such accruals are adjusted as further information develops or circumstances change.  For certain matters, the Company expects to share costs with other parties.  Recoveries of environmental remediation costs from other parties are recorded as assets when their receipt is deemed certain.

Foreign Currency

The functional currency of the Company's foreign subsidiaries is the applicable local currency.  The translation of the applicable foreign currencies into U.S. dollars is performed for balance sheet accounts using current exchange rates in effect at the balance sheet date and for revenue and expense accounts and cash flows using average rates of exchange prevailing during the year.  Adjustments resulting from the translation of foreign currency financial statements are accumulated in stockholders' equity until the entity is sold or substantially liquidated.  Gains or losses relating to transactions of a long-term investment nature are also accumulated in stockholders' equity.  Gains or losses resulting from third-party foreign currency transactions are included in the income statement as a component of other revenues in the consolidated income statement.  Foreign currency net transaction gains/(losses) were $186, ($133) and ($274) in 2014, 2013 and 2012, respectively.

Earnings per Common Share

All diluted earnings per share are computed on the basis of the weighted average shares of common stock outstanding plus common equivalent shares arising from the effect of dilutive stock options, equity-settled performance shares and restricted stock units, using the treasury stock method.

For the years ended December 31, 2014, 2013 and 2012, shares of 940,038, 916,350, and 580,745, respectively, were not included in the calculation of diluted shares outstanding because the effect would be anti-dilutive.

Comprehensive Income

Included within accumulated other comprehensive income for the Company are foreign currency translation adjustments, changes in the fair value related to derivative instruments classified as cash flow hedges, net of related tax, and changes in the pensions, net of tax.  Total comprehensive income/loss for the years ended December 31, 2014 and 2013 are included in the Statements of Comprehensive Income.

The components of accumulated other comprehensive loss in stockholders’ equity are as follows:

	2014			2013
Foreign currency translation	$	(11,410	)	$	9,990
Unrealized loss on hedging contracts, net of tax		(193	)		(396	)
Pensions, net of tax		(33,378	)		(28,556	)
Total	$	(44,981	)	$	(18,962	)

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Foreign Operations and Sales (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended													12 Months Ended
	Dec. 31, 2014		Sep. 30, 2014		Jun. 30, 2014		Mar. 31, 2014		Dec. 31, 2013	Sep. 30, 2013	Jun. 30, 2013	Mar. 31, 2013		Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Revenues from External Customers and Long-Lived Assets [Line Items]
Total Gross sales	$ 128,841	[1]	$ 81,145	[2]	$ 97,972	[3]	$ 66,192	[4]	$ 103,011	$ 77,992	$ 61,628	$ 74,581	[5]	$ 374,150	$ 317,212	$ 277,931
Long-Lived Assets	216,381								214,647					216,381	214,647	193,218
Export sales, included in domestic gross sales														101,101	86,850	32,872
Major customer (in hundredths)														24.00%	18.30%	12.50%
Domestic [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total Gross sales														186,735	153,202	109,729
Long-Lived Assets	64,995								59,496					64,995	59,496	44,085
Foreign [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total Gross sales														187,415	164,010	168,202
Long-Lived Assets	151,386								155,151					151,386	155,151	149,133
Europe [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total Gross sales														232,894	210,463	150,678
North America [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total Gross sales														117,477	86,974	105,439
Asia [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total Gross sales														12,865	13,800	12,827
Other [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total Gross sales														$ 10,914	$ 5,975	$ 8,987

[1] Income from continuing operations includes a gain on sale of land of $1,234 and a corresponding tax expense of $387, a benefit of $11,719 for the reversal of a valuation allowance on deferred tax assets, a benefit of $3,948 for favorable audit settlements, and expense of $7,170 related to a voluntary lump sum pension settlement.

[2] Income from continuing operations includes the reversal of a valuation allowance on deferred tax assets of $824.

[3] Income from continuing operations includes the reversal of a valuation allowance on deferred tax assets of $14,161 and a loss of $4,122 related to the purchase of the remaining shares in Zenara.

[4] Income from continuing operations includes the reversal of a valuation allowance on deferred tax assets of $198.

[5] Income from continuing operations includes a gain on sale of an office building of $4,680 and a corresponding tax expense of $1,470 and a benefit of $1,155 due to changes in tax laws.

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Foreign Operations and Sales (Tables)

12 Months Ended

Dec. 31, 2014

Foreign Operations and Sales [Abstract]

Gross sales and long lived tangible assets for the entity's domestic and foreign entities

The following summarized data represents the gross sales and long lived assets for the Company’s domestic and foreign entities for 2014, 2013 and 2012:

	Domestic		Foreign		Total
2014
Gross sales	$	186,735	$	187,415	$	374,150
Long-lived assets		64,995		151,386		216,381
2013
Gross sales	$	153,202	$	164,010	$	317,212
Long-lived assets		59,496		155,151		214,647
2012
Gross sales	$	109,729	$	168,202	$	277,931
Long-lived assets		44,085		149,133		193,218

Sales to geographic area

Sales to geographic area consist of the following:

	2014		2013		2012
Europe	$	232,894	$	210,463	$	150,678
North America		117,477		86,974		105,439
Asia		12,865		13,800		12,827
Other		10,914		5,975		8,987
Total	$	374,150	$	317,212	$	277,931

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Gain on Sale of Asset

12 Months Ended

Dec. 31, 2014

Gain on Sale of Asset [Abstract]

Gain on Sale of Asset

(22) Gain on Sale of Asset

For the year ended December 31, 2014, the Company recorded a gain on the sale of land of $1,234.  For the year ended December 31, 2013, the Company recorded a gain on the sale of an office building of $4,680.  The carrying values of the building and land were not material.

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Discontinued Operations

12 Months Ended

Dec. 31, 2014

Discontinued Operations [Abstract]

Discontinued Operations

(21) Discontinued Operations

For 2014, the Company recorded pre-tax charges of $1,277, reduced by a tax benefit of $447, for environmental remediation related to sites of divested businesses as discontinued operations.  For 2013, the Company recorded pre-tax charges of $6,708, reduced by a tax benefit of $2,348, for environmental remediation related to sites of divested businesses as discontinued operations.  For 2012, the Company recorded pre-tax charges of $1,425, reduced by a tax benefit of $499, for environmental remediation related to sites of divested businesses as discontinued operations.

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Derivatives and Hedging Activities (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Foreign Currency Forward Contracts [Member]
Derivative Instrument Detail [Abstract]
Notional amount of cash flow hedge instruments	$ 3,632
Fair value of foreign exchange forward contracts	(102)
Interest Rate Swap [Member]
Derivative Instrument Detail [Abstract]
Notional amount of cash flow hedge instruments	60,000
Maturity date	Sep. 30, 2015
Interest rate swap, fixed rate (in hundredths)	0.92%
Fair value of swap	$ (304)	$ (616)	$ (930)

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Commitments (Tables)

12 Months Ended

Dec. 31, 2014

Commitments [Abstract]

Future minimum commitments under non-cancelable operating lease arrangements

At December 31, 2014, future minimum commitments under non-cancelable operating lease arrangements were as follows:

Year ended December 31:
2015	$	1,194
2016		600
2017		588
2018		528
2019		193
2020 and thereafter		90
Total commitments	$	3,193

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SELECTED QUARTERLY FINANCIAL AND SUPPLEMENTARY DATA - UNAUDITED

12 Months Ended

Dec. 31, 2014

SELECTED QUARTERLY FINANCIAL AND SUPPLEMENTARY DATA - UNAUDITED [Abstract]

Selected Quarterly Financial and Supplementary Data

SELECTED QUARTERLY FINANCIAL AND SUPPLEMENTARY DATA - UNAUDITED

(in thousands, except share and per share data)

	1st Quarter (1)			2nd Quarter (2)			3rd Quarter (3)			4th Quarter (4)
2014
Gross sales	$	66,192		$	97,972		$	81,145		$	128,841
Net revenues		66,105			97,893			81,300			129,315
Gross profit		16,578			33,415			28,406			45,399
Income from continuing operations		1,166			19,827			8,882			28,258
Loss from discontinued operations (6)		(184	)		(160	)		(113	)		(373	)
Net income		982			19,667			8,769			27,885
Earnings per share of common stock: (7)
Basic		0.03			0.64			0.28			0.90
Diluted		0.03			0.63			0.28			0.88
Average shares:
Basic		30,546			30,647			30,801			31,053
Diluted		31,408			31,428			31,599			31,803
	1st Quarter (5)			2nd Quarter			3rd Quarter			4th Quarter
2013
Gross sales	$	74,581		$	61,628		$	77,992		$	103,011
Net revenues		74,885			62,803			77,452			103,036
Gross profit		24,749			19,251			24,966			33,938
Income from continuing operations		11,425			3,136			6,274			9,440
Loss from discontinued operations (6)		(257	)		(862	)		(2,700	)		(541	)
Net income		11,168			2,274			3,574			8,899
Earnings per share of common stock: (7)
Basic		0.37			0.07			0.12			0.29
Diluted		0.36			0.07			0.12			0.29
Average shares:
Basic		29,970			30,089			30,184			30,353
Diluted		30,788			30,956			31,052			31,166

(1) Income from continuing operations includes the reversal of a valuation allowance on deferred tax assets of $198.

(2) Income from continuing operations includes the reversal of a valuation allowance on deferred tax assets of $14,161 and a loss of $4,122 related to the purchase of the remaining shares in Zenara.

(3) Income from continuing operations includes the reversal of a valuation allowance on deferred tax assets of $824.

(4) Income from continuing operations includes a gain on sale of land of $1,234 and a corresponding tax expense of $387, a benefit of $11,719 for the reversal of a valuation allowance on deferred tax assets, a benefit of $3,948 for favorable audit settlements, and expense of $7,170 related to a voluntary lump sum pension settlement.

(5) Income from continuing operations includes a gain on sale of an office building of $4,680 and a corresponding tax expense of $1,470 and a benefit of $1,155 due to changes in tax laws.

(6) Discontinued operations include charges for environmental remediation related to sites of divested businesses.

(7) Earnings per share calculations for each of the quarters are based on the weighted average number of shares outstanding for each period.  As such, the sum of the quarters may not necessarily equal the earnings per share amount for the year.

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SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS

12 Months Ended

Dec. 31, 2014

SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS [Abstract]

SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS

VALUATION AND QUALIFYING ACCOUNTS

FOR THE YEARS ENDED DECEMBER 31, 2014, 2013 and 2012

(dollars in thousands)

Column A	Column B		Column C						Column D		Column E
			Additions
	Balance Beginning of Year		Charged/ (Credited) to Cost and Expenses			Charged/ (Credited) to Other Accounts			Deductions		Balance End of Year
Description
Year ended December 31, 2014:
Doubtful trade receivables and returns and allowances	$	1,058	$	61		$	(130	)	$	643	$	346
Deferred tax valuation allowance		29,890		(26,543	)		1,706			-		5,053
Year ended December 31, 2013:
Doubtful trade receivables and returns and allowances	$	652	$	433		$	27		$	54	$	1,058
Deferred tax valuation allowance		29,941		(97	)		46			-		29,890
Year ended December 31, 2012:
Doubtful trade receivables and returns and allowances	$	450	$	193		$	12		$	3	$	652
Deferred tax valuation allowance		77,571		(45,105	)		(2,525	)		-		29,941

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The Company

12 Months Ended

Dec. 31, 2014

The Company [Abstract]

The Company

(1) The Company

Cambrex Corporation and Subsidiaries (the “Company” or “Cambrex”) primarily provides products and services worldwide to pharmaceutical companies and generic drug companies.  The Company is dedicated to accelerating its customers’ drug discovery, development and manufacturing processes for human therapeutics.  The Company’s products consist of active pharmaceutical ingredients (“APIs”) and pharmaceutical intermediates produced under Food and Drug Administration current Good Manufacturing Practices for use in the production of prescription and over-the-counter drug products.  Cambrex has three operating segments, which are manufacturing facilities that have been aggregated as one reportable segment.  A fourth facility is immaterial.

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Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2014

Summary of Significant Accounting Policies [Abstract]

Principles of Consolidation

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries.  Equity investments in which the Company exercises significant influence but does not control, are accounted for using the equity method.  The Company’s share of its equity method investees’ earnings or losses are included in “Other expenses/(income)” in the income statements. The Company eliminates its pro rata share of gross profit on sales with its equity method investees for assets still remaining in inventory at the end of the reporting period.  All other significant intercompany balances and transactions have been eliminated in consolidation.

Cash Equivalents

Cash Equivalents

Temporary cash investments with an original maturity of less than three months are considered cash equivalents.  The carrying amounts approximate fair value.

Allowance for Doubtful Accounts

Allowance for Doubtful Accounts

The Company maintains allowances for doubtful accounts relating to estimated losses resulting from customers being unable to make required payments.  Allowances for doubtful accounts are based on historical experience and known factors regarding specific customers and the industries in which those customers operate.  If the financial condition of the Company’s customers were to deteriorate, resulting in their inability to make payments, additional allowances would be required.

Concentrations of credit risk

Concentrations of credit risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents and accounts receivable. In the normal course of business, the Company maintains cash balances with European Union banks ranging from the equivalent of $1,000 - $10,000. The Company routinely monitors the risks associated with these institutions and diversifies its exposure by maintaining smaller balances with multiple financial institutions.  Concentrations of credit risk with respect to accounts receivable are limited due to the Company's large number of customers and their dispersion throughout the world. At December 31, 2014 and 2013, the Company had receivables with one customer totaling nearly 38% of overall accounts receivables. The Company does not consider this customer to pose any significant credit risk.

Derivative Instruments

Derivative Instruments

Derivative financial instruments are periodically used by the Company primarily to mitigate a variety of working capital, investment and borrowing risks.  The Company primarily uses foreign currency forward contracts to minimize foreign currency exchange rate risk associated with foreign currency transactions.  Changes in the fair value on these forward contracts are recognized in earnings.  The Company uses interest rate swap instruments only as hedges.  As such, the differential to be paid or received in connection with these instruments is accrued and recognized in income as an adjustment to interest expense.

None of the foreign currency forward contracts entered into during 2014 were designated for hedge accounting treatment. There were no foreign currency forward contracts entered into or outstanding in 2013.

Inventories

Inventories

Inventories are stated at the lower of cost, determined on a first‑in, first‑out basis, or market.  The determination of market value involves assessment of numerous factors, including estimated selling prices.  Reserves are recorded to reduce the carrying value for inventory determined to be damaged, obsolete or otherwise unsaleable.

Property, Plant and Equipment

Property, Plant and Equipment

Property, plant and equipment is stated at cost, net of accumulated depreciation.  Plant and equipment are depreciated on a straight‑line basis over the estimated useful lives for each applicable asset group as follows:

Buildings and improvements	20 to 30 years, or term of lease if applicable
Machinery and equipment	7 to 15 years
Furniture and fixtures	5 to 7 years
Computer hardware and software	3 to 7 years

Expenditures for additions, major renewals or betterments are capitalized and expenditures for maintenance and repairs are charged to income as incurred.

When assets are retired or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts, and any resulting gain or loss is reflected in costs of goods sold or operating expenses.  Interest is capitalized in connection with the construction and acquisition of assets that are capitalized over longer periods of time for larger amounts.  The capitalized interest is recorded as part of the cost of the asset to which it relates and is amortized over the asset’s estimated useful life.  Total interest capitalized in connection with ongoing construction activities was $128 in 2014, $298 in 2013 and negligible in 2012.

Impairment of Goodwill

Impairment of Goodwill

The Company reviews the carrying value of goodwill to determine whether impairment may exist on an annual basis or whenever it has reason to believe goodwill may not be recoverable.  The annual impairment test of goodwill is performed during the fourth quarter of each fiscal year. The Company did not have an impairment for any of the years presented.

Goodwill impairment is determined by the Company using a two-step process.  The first step of the goodwill impairment test is used to identify potential impairment by comparing the fair value of each reporting unit, determined using various valuation techniques, with the primary technique being a discounted cash flow analysis, to its carrying value.  If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired and the second step of the impairment test is unnecessary.  If the carrying amount of a reporting unit exceeds its fair value, the second step of the goodwill impairment test is performed to measure the amount of impairment loss, if any.  The second step of the goodwill impairment test compares the implied fair value of the reporting unit’s goodwill with the carrying amount of that goodwill.  If the carrying amount of the reporting unit’s goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized.

Based upon the Company’s  most recent analysis, with the exception of Zenara, the fair value of all other reporting units substantially exceeded their carrying values. Zenara, which was acquired during 2014, has an estimated fair value that closely approximates the carrying value.  The goodwill of Zenara was $9,715.  The Zenara business, based in India, has been in operation for a relatively short period of time compared to Cambrex’s other businesses, and competes with other low cost providers globally.  Cambrex’s current assumptions and those used at acquisition include adding a significant amount of new and profitable customers by utilizing Cambrex’s global sales force as well as making operational improvements to the business.  The business has few customers and is expected to operate at or slightly below breakeven in 2015.  Any negative changes in assumptions on new customers, volumes, or Cambrex’s ability to improve operations while maintaining a competitive cost structure could adversely affect the fair value of Zenara and result in significant goodwill or other long-lived asset impairment charges in 2015 or later.

Impairment of Long-Lived Assets

Impairment of Long-Lived Assets

The Company assesses the impairment of its long-lived assets, including amortizable intangible assets, and property, plant and equipment, whenever economic events or changes in circumstances indicate that the carrying amounts of the assets may not be recoverable.  Long lived assets are considered to be impaired when the sum of the undiscounted expected future operating cash flows is less than the carrying amounts of the related assets.  If impaired, the assets are written down to fair market value.

The Company has investments in partially-owned affiliates.  It does not separately test an investee’s underlying assets for impairments but will recognize its share of any impairment charge recorded by an investee in earnings and consider the effect of the impairment on its investment.  A series of operating losses of an investee or other factors may indicate that a decrease in value of the investment has occurred that is other than temporary. A loss in value of an investment that is other than a temporary decline would be recognized as an impairment if the fair value of that investment is less than its carrying amount.

Revenue Recognition

Revenue Recognition

Revenues are generally recognized when title to products and risk of loss are transferred to customers.  Additional conditions for recognition of revenue are that collection of sales proceeds is reasonably assured and the Company has no further performance obligations.

Amounts billed in advance are recorded as deferred revenue on the balance sheet. Since payments received are sometimes non-refundable, the termination of a contract by a customer prior to its completion could result in an immediate recognition of deferred revenue relating to payments already received but not previously recognized as revenue.

Sales terms to certain customers include rebates if certain conditions are met.  Additionally, sales are generally made with a limited right of return under certain conditions.  The Company estimates these rebates and returns at the time of sale based on the terms of agreements with customers and historical experience and recognizes revenue net of these estimated costs which are classified as allowances and rebates.

The Company bills a portion of freight cost incurred on shipments to customers.  Amounts billed to customers are recorded within net revenues.  Freight costs are reflected in cost of goods sold.

Income Taxes

Income Taxes

The Company and its eligible subsidiaries file a consolidated U.S. income tax return.  Foreign subsidiaries are consolidated for financial reporting but are not eligible to be included in the consolidated U.S. income tax return, however the earnings of foreign subsidiaries are generally taxed by the U.S. when repatriated and such U.S. tax may be reduced or eliminated by federal foreign tax credits based on the foreign income and withholding taxes paid or accrued by the foreign subsidiary.  Historically, the Company intended to reinvest foreign earnings indefinitely outside of the U.S. and only considered repatriating excess cash from foreign subsidiaries if it could utilize fully valued domestic tax attributes to completely offset any tax expense that would otherwise result.  Unrecognized foreign tax credits and fully valued foreign tax credit carryovers were available to offset any potential U.S. tax liability.  Therefore, the Company had not provided U.S. federal income taxes or foreign withholding taxes on its undistributed earnings from foreign operations prior to 2012.  During the fourth quarter of 2012, the Company completed a detailed forecast of foreign source income by jurisdiction as part of the ongoing process to evaluate its valuation allowance against deferred tax assets.  As part of this process, as well as a continuing desire to limit its credit and currency exposure for cash held in foreign currencies or in non-U.S. banks, the Company determined that it is likely that a portion of the undistributed earnings of its foreign subsidiaries will be repatriated to the U.S. in the future. Accordingly, in 2012 the Company changed its indefinite reinvestment assertion and now provides deferred taxes on certain undistributed foreign earnings.  Subject to limitations, U.S. income tax on such foreign earnings, when actually repatriated, may be reduced or eliminated by unrecognized foreign tax credits that may be generated in connection with the repatriation or by existing foreign tax credit carryforwards or other tax attributes for which valuation allowance was released.  The Company monitors available evidence and its plans for foreign earnings and expects to continue to provide deferred taxes based on the tax liability that would be due upon repatriation of amounts not considered permanently reinvested.

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

Environmental Costs

Environmental Costs

The Company is subject to extensive and changing federal, state, local and foreign environmental laws and regulations, and has made provisions for the estimated financial impact of environmental activities.  The Company’s policy is to accrue environmental related costs of a non-capital nature, including estimated litigation costs, when those costs are believed to be probable and can be reasonably estimated.  The quantification of environmental exposures requires an assessment of many factors, including changing laws and regulations, advancements in environmental technologies, the quality of information available related to specific sites, the assessment stage of each site investigation, preliminary findings and the length of time involved in remediation or settlement.  Such accruals are adjusted as further information develops or circumstances change.  For certain matters, the Company expects to share costs with other parties.  Recoveries of environmental remediation costs from other parties are recorded as assets when their receipt is deemed certain.

Foreign Currency

Foreign Currency

The functional currency of the Company's foreign subsidiaries is the applicable local currency.  The translation of the applicable foreign currencies into U.S. dollars is performed for balance sheet accounts using current exchange rates in effect at the balance sheet date and for revenue and expense accounts and cash flows using average rates of exchange prevailing during the year.  Adjustments resulting from the translation of foreign currency financial statements are accumulated in stockholders' equity until the entity is sold or substantially liquidated.  Gains or losses relating to transactions of a long-term investment nature are also accumulated in stockholders' equity.  Gains or losses resulting from third-party foreign currency transactions are included in the income statement as a component of other revenues in the consolidated income statement.  Foreign currency net transaction gains/(losses) were $186, ($133) and ($274) in 2014, 2013 and 2012, respectively.

Earnings per Common Share

Earnings per Common Share

All diluted earnings per share are computed on the basis of the weighted average shares of common stock outstanding plus common equivalent shares arising from the effect of dilutive stock options, equity-settled performance shares and restricted stock units, using the treasury stock method.

For the years ended December 31, 2014, 2013 and 2012, shares of 940,038, 916,350, and 580,745, respectively, were not included in the calculation of diluted shares outstanding because the effect would be anti-dilutive.

Comprehensive Income

Comprehensive Income

Included within accumulated other comprehensive income for the Company are foreign currency translation adjustments, changes in the fair value related to derivative instruments classified as cash flow hedges, net of related tax, and changes in the pensions, net of tax.  Total comprehensive income/loss for the years ended December 31, 2014 and 2013 are included in the Statements of Comprehensive Income.

The components of accumulated other comprehensive loss in stockholders’ equity are as follows:

	2014			2013
Foreign currency translation	$	(11,410	)	$	9,990
Unrealized loss on hedging contracts, net of tax		(193	)		(396	)
Pensions, net of tax		(33,378	)		(28,556	)
Total	$	(44,981	)	$	(18,962	)

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Accumulated Other Comprehensive Loss (Tables)

12 Months Ended

Dec. 31, 2014

Accumulated Other Comprehensive Loss [Abstract]

Schedule of changes in accumulated other comprehensive income

The following tables provide the changes in AOCI by component, net of tax, for the years ended December 31, 2014 and 2013:

	Foreign Currency Translation Adjustments			Interest Rate Swap			Pension Plans			Total
Balance as of December 31, 2013	$	9,990		$	(396	)	$	(28,556	)	$	(18,962	)
Other comprehensive loss before reclassifications		(25,800	)		(99	)		(12,566	)		(38,465	)
Amounts reclassified from accumulated other comprehensive loss		4,400			302			7,744			12,446
Net current-period other comprehensive (loss)/income		(21,400	)		203			(4,822	)		(26,019	)
Balance as of December 31, 2014	$	(11,410	)	$	(193	)	$	(33,378	)	$	(44,981	)
	Foreign Currency Translation Adjustments			Interest Rate Swap			Pension Plans			Total
Balance as of December 31, 2012	$	5,177		$	(600	)	$	(38,668	)	$	(34,091	)
Other comprehensive income/(loss) before reclassifications		4,813			(85	)		9,173			13,901
Amounts reclassified from accumulated other comprehensive loss		-			289			939			1,228
Net current-period other comprehensive income		4,813			204			10,112			15,129
Balance as of December 31, 2013	$	9,990		$	(396	)	$	(28,556	)	$	(18,962	)

Reclassifications out of accumulated other comprehensive income

The following tables provide the reclassifications out of AOCI by component for the years ended December 31, 2014 and 2013:

Details about AOCI Components	Amount Reclassified from AOCI for the year ended December 31, 2014			Affected Line Item in the Consolidated Income Statement
Losses on cash flow hedge:
Interest rate swap	$	(465	)	Interest expense, net
		163		Tax benefit
	$	(302	)	Net of tax
Amortization of defined benefit pension items:
Loss on voluntary settlement	$	(7,170	)	Loss on voluntary pension settlement
Actuarial losses		(756	)	Selling, general and administrative expenses
Actuarial losses		(46	)	Cost of goods sold
Prior service costs		(52	)	Selling, general and administrative expenses
		(8,024	)	Total before tax
		280		Tax benefit
	$	(7,744	)	Net of tax
Foreign currency translation adjustment:
Release of currency translation adjustment	$	(4,400	)	Equity in losses of partially-owned affiliates
		-		Tax benefit
	$	(4,400	)	Net of tax
Total reclassification for the period	$	(12,446	)
Details about AOCI Components	Amount Reclassified from AOCI for the year ended December 31, 2013			Affected Line Item in the Consolidated Income Statement
Losses on cash flow hedge:
Interest rate swap	$	(444	)	Interest expense, net
		155		Tax benefit
	$	(289	)	Net of tax
Amortization of defined benefit pension items:
Actuarial losses	$	(1,223	)	Selling, general and administrative expenses
Actuarial losses		(116	)	Cost of goods sold
Prior service costs		(50	)	Selling, general and administrative expenses
		(1,389	)	Total before tax
		450		Tax benefit
	$	(939	)	Net of tax
Total reclassification for the period	$	(1,228	)

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Accrued Expense and Other Current Liabilities (Details) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2014	Dec. 31, 2013
Accrued Expenses And Other Current Liabilities [Abstract]
Salaries and employee benefits payable	$ 26,893	$ 26,211
Taxes payable and related reserves	5,420	10,168
Other	8,701	11,719
Total	$ 41,014	$ 48,098

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CONSOLIDATED BALANCE SHEETS (USD $) In Thousands, unless otherwise specified	Dec. 31, 2014	Dec. 31, 2013
Current assets:
Cash and cash equivalents	$ 45,518	$ 22,745
Trade receivables, less allowances of $346 and $1,058 at respective dates	77,124	71,276
Other receivables	10,610	12,943
Inventories, net	85,630	89,965
Prepaid expenses and other current assets	8,688	5,631
Total current assets	227,570	202,560
Property, plant and equipment, net	163,567	171,966
Goodwill	43,912	38,670
Intangible assets, net	8,902	4,011
Investments in and advances to partially-owned affiliates	665	13,364
Deferred income taxes	38,424	19,799
Other non-current assets	4,032	7,667
Total assets	487,072	458,037
Current liabilities:
Accounts payable	43,670	29,052
Deferred revenue	14,095	20,121
Accrued expenses and other current liabilities	41,014	48,098
Total current liabilities	98,779	97,271
Long-term debt	60,000	79,250
Deferred income taxes	10,545	12,835
Accrued pension benefits	50,949	40,123
Other non-current liabilities	15,573	18,338
Total liabilities	235,846	247,817
Commitments and contingencies (see Notes 19 and 20)
Stockholders' equity:
Common Stock, $.10 par value; authorized 100,000,000 issued 32,836,930 and 32,240,795 shares at respective dates	3,284	3,223
Additional paid-in capital	119,265	109,765
Retained earnings	188,481	131,178
Treasury stock, at cost, 1,738,624 and 1,757,530 shares at respective dates	(14,823)	(14,984)
Accumulated other comprehensive loss	(44,981)	(18,962)
Total stockholders' equity	251,226	210,220
Total liabilities and stockholders' equity	$ 487,072	$ 458,037

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SELECTED QUARTERLY FINANCIAL AND SUPPLEMENTARY DATA - UNAUDITED (Tables)

12 Months Ended

Dec. 31, 2014

SELECTED QUARTERLY FINANCIAL AND SUPPLEMENTARY DATA - UNAUDITED [Abstract]

Schedule of selected quarterly financial and supplementary data

SELECTED QUARTERLY FINANCIAL AND SUPPLEMENTARY DATA - UNAUDITED

(in thousands, except share and per share data)

	1st Quarter (1)			2nd Quarter (2)			3rd Quarter (3)			4th Quarter (4)
2014
Gross sales	$	66,192		$	97,972		$	81,145		$	128,841
Net revenues		66,105			97,893			81,300			129,315
Gross profit		16,578			33,415			28,406			45,399
Income from continuing operations		1,166			19,827			8,882			28,258
Loss from discontinued operations (6)		(184	)		(160	)		(113	)		(373	)
Net income		982			19,667			8,769			27,885
Earnings per share of common stock: (7)
Basic		0.03			0.64			0.28			0.90
Diluted		0.03			0.63			0.28			0.88
Average shares:
Basic		30,546			30,647			30,801			31,053
Diluted		31,408			31,428			31,599			31,803
	1st Quarter (5)			2nd Quarter			3rd Quarter			4th Quarter
2013
Gross sales	$	74,581		$	61,628		$	77,992		$	103,011
Net revenues		74,885			62,803			77,452			103,036
Gross profit		24,749			19,251			24,966			33,938
Income from continuing operations		11,425			3,136			6,274			9,440
Loss from discontinued operations (6)		(257	)		(862	)		(2,700	)		(541	)
Net income		11,168			2,274			3,574			8,899
Earnings per share of common stock: (7)
Basic		0.37			0.07			0.12			0.29
Diluted		0.36			0.07			0.12			0.29
Average shares:
Basic		29,970			30,089			30,184			30,353
Diluted		30,788			30,956			31,052			31,166

(1) Income from continuing operations includes the reversal of a valuation allowance on deferred tax assets of $198.

(2) Income from continuing operations includes the reversal of a valuation allowance on deferred tax assets of $14,161 and a loss of $4,122 related to the purchase of the remaining shares in Zenara.

(3) Income from continuing operations includes the reversal of a valuation allowance on deferred tax assets of $824.

(4) Income from continuing operations includes a gain on sale of land of $1,234 and a corresponding tax expense of $387, a benefit of $11,719 for the reversal of a valuation allowance on deferred tax assets, a benefit of $3,948 for favorable audit settlements, and expense of $7,170 related to a voluntary lump sum pension settlement.

(5) Income from continuing operations includes a gain on sale of an office building of $4,680 and a corresponding tax expense of $1,470 and a benefit of $1,155 due to changes in tax laws.

(6) Discontinued operations include charges for environmental remediation related to sites of divested businesses.

(7) Earnings per share calculations for each of the quarters are based on the weighted average number of shares outstanding for each period.  As such, the sum of the quarters may not necessarily equal the earnings per share amount for the year.

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CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (USD $) In Thousands, except Share data, unless otherwise specified	Common Stock [Member]	Additional Paid-In Capital [Member]	Retained Earnings [Member]	Treasury Stock [Member]	Accumulated Other Comprehensive Loss [Member]	Total
Balance at Dec. 31, 2011	$ 3,143	$ 101,646	$ 42,960	$ (15,821)	$ (31,587)	$ 100,341
Balance (in shares) at Dec. 31, 2011	31,441,138
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income			62,303			62,303
Other comprehensive income/(loss)					(2,504)	(2,504)
Exercise of stock options	26	1,329				1,355
Exercise of stock options (in shares)	263,092
Vested restricted stock		(604)		604		0
Stock option expense		1,303				1,303
Restricted stock expense		446				446
Performance stock expense		53				53
Balance at Dec. 31, 2012	3,169	104,173	105,263	(15,217)	(34,091)	163,297
Balance (in shares) at Dec. 31, 2012	31,704,230
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income			25,915			25,915
Other comprehensive income/(loss)					15,129	15,129
Exercise of stock options	54	3,170				3,224
Exercise of stock options (in shares)	536,565
Vested restricted stock		(534)		534		0
Stock option expense		1,994				1,994
Restricted stock expense		427				427
Performance stock expense		404				404
Share based compensation tax windfall		131				131
Repurchase of shares				(301)		(301)
Balance at Dec. 31, 2013	3,223	109,765	131,178	(14,984)	(18,962)	210,220
Balance (in shares) at Dec. 31, 2013	32,240,795					32,240,795
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income			57,303			57,303
Other comprehensive income/(loss)					(26,019)	(26,019)
Exercise of stock options	61	4,142				4,203
Exercise of stock options (in shares)	596,135
Vested restricted stock		(161)		161		0
Stock option expense		2,491				2,491
Restricted stock expense		395				395
Performance stock expense		2,116				2,116
Share based compensation tax windfall		517				517
Balance at Dec. 31, 2014	$ 3,284	$ 119,265	$ 188,481	$ (14,823)	$ (44,981)	$ 251,226
Balance (in shares) at Dec. 31, 2014	32,836,930					32,836,930

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Accumulated Other Comprehensive Loss (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended													12 Months Ended
	Dec. 31, 2014		Sep. 30, 2014		Jun. 30, 2014		Mar. 31, 2014		Dec. 31, 2013	Sep. 30, 2013	Jun. 30, 2013	Mar. 31, 2013		Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Changes In accumulated other comprehensive income/(Loss) [Roll Forward]
Beginning balance							$ (18,962)					$ (34,091)		$ (18,962)	$ (34,091)
Other comprehensive income/(loss) before reclassifications														(38,465)	13,901
Amounts reclassified from accumulated other comprehensive loss														12,446	1,228
Net current-period other comprehensive income														(26,019)	15,129	(2,504)
Ending balance	(44,981)								(18,962)					(44,981)	(18,962)	(34,091)
Amount Reclassified from AOCI [Abstract]
Interest expense, net														(2,174)	(2,242)	(2,439)
Loss on voluntary pension settlement	(7,170)													(7,170)	0	0
Selling, general and administrative expenses														(52,489)	(47,568)	(45,248)
Cost of Goods Sold														(250,815)	(215,272)	(186,014)
Total before tax														45,506	45,007	31,368
Equity in losses of partially-owned affiliates														(4,623)	(2,262)	(1,766)
Tax benefit														12,627	(14,732)	31,861
Net of tax	27,885	[1]	8,769	[2]	19,667	[3]	982	[4]	8,899	3,574	2,274	11,168	[5]	57,303	25,915	62,303
Amounts reclassified from accumulated other comprehensive income/(loss) [Member]
Amount Reclassified from AOCI [Abstract]
Net of tax														(12,446)	(1,228)
Foreign Currency Translation Adjustments [Member]
Changes In accumulated other comprehensive income/(Loss) [Roll Forward]
Beginning balance							9,990					5,177		9,990	5,177
Other comprehensive income/(loss) before reclassifications														(25,800)	4,813
Amounts reclassified from accumulated other comprehensive loss														4,400	0
Net current-period other comprehensive income														(21,400)	4,813
Ending balance	(11,410)								9,990					(11,410)	9,990
Foreign Currency Translation Adjustments [Member] | Amounts reclassified from accumulated other comprehensive income/(loss) [Member]
Amount Reclassified from AOCI [Abstract]
Equity in losses of partially-owned affiliates														(4,400)
Tax benefit														0
Net of tax														(4,400)
Cash Flow Hedge - Interest Rate Swap [Member]
Changes In accumulated other comprehensive income/(Loss) [Roll Forward]
Beginning balance							(396)					(600)		(396)	(600)
Other comprehensive income/(loss) before reclassifications														(99)	(85)
Amounts reclassified from accumulated other comprehensive loss														302	289
Net current-period other comprehensive income														203	204
Ending balance	(193)								(396)					(193)	(396)
Cash Flow Hedge - Interest Rate Swap [Member] | Amounts reclassified from accumulated other comprehensive income/(loss) [Member]
Amount Reclassified from AOCI [Abstract]
Interest expense, net														(465)	(444)
Tax benefit														163	155
Net of tax														(302)	(289)
Defined Benefit Pension Plans [Member]
Changes In accumulated other comprehensive income/(Loss) [Roll Forward]
Beginning balance							(28,556)					(38,668)		(28,556)	(38,668)
Other comprehensive income/(loss) before reclassifications														(12,566)	9,173
Amounts reclassified from accumulated other comprehensive loss														7,744	939
Net current-period other comprehensive income														(4,822)	10,112
Ending balance	(33,378)								(28,556)					(33,378)	(28,556)
Defined Benefit Pension Plans [Member] | Amounts reclassified from accumulated other comprehensive income/(loss) [Member]
Amount Reclassified from AOCI [Abstract]
Total before tax														(8,024)	(1,389)
Tax benefit														280	450
Net of tax														(7,744)	(939)
Loss on voluntary settlement [Member] | Amounts reclassified from accumulated other comprehensive income/(loss) [Member]
Amount Reclassified from AOCI [Abstract]
Loss on voluntary pension settlement														(7,170)
Actuarial Loss [Member] | Amounts reclassified from accumulated other comprehensive income/(loss) [Member]
Amount Reclassified from AOCI [Abstract]
Selling, general and administrative expenses														(756)	(1,223)
Cost of Goods Sold														(46)	(116)
Prior Service Cost [Member] | Amounts reclassified from accumulated other comprehensive income/(loss) [Member]
Amount Reclassified from AOCI [Abstract]
Selling, general and administrative expenses														$ (52)	$ (50)

[1] Income from continuing operations includes a gain on sale of land of $1,234 and a corresponding tax expense of $387, a benefit of $11,719 for the reversal of a valuation allowance on deferred tax assets, a benefit of $3,948 for favorable audit settlements, and expense of $7,170 related to a voluntary lump sum pension settlement.

[2] Income from continuing operations includes the reversal of a valuation allowance on deferred tax assets of $824.

[3] Income from continuing operations includes the reversal of a valuation allowance on deferred tax assets of $14,161 and a loss of $4,122 related to the purchase of the remaining shares in Zenara.

[4] Income from continuing operations includes the reversal of a valuation allowance on deferred tax assets of $198.

[5] Income from continuing operations includes a gain on sale of an office building of $4,680 and a corresponding tax expense of $1,470 and a benefit of $1,155 due to changes in tax laws.

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Property, Plant and Equipment (Tables)

12 Months Ended

Dec. 31, 2014

Property, Plant and Equipment [Abstract]

Schedule of property, plant and equipment

Property, plant and equipment consist of the following:

	December 31,
	2014			2013
Land	$	4,117		$	4,312
Buildings and improvements		103,083			108,460
Machinery and equipment		365,623			398,490
Furniture and fixtures		1,821			1,884
Construction in progress		20,085			16,808
Total		494,729			529,954
Accumulated depreciation		(331,162	)		(357,988	)
Net	$	163,567		$	171,966

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Discontinued Operations (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Discontinued Operations [Abstract]
Pre tax charges for environmental remediation related to sites of divested businesses	$ (1,277)	$ (6,708)	$ (1,425)
Tax effect of discontinued operation - remediation charges	$ 447	$ 2,348	$ 499

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Accumulated Other Comprehensive Loss

12 Months Ended

Dec. 31, 2014

Accumulated Other Comprehensive Loss [Abstract]

Accumulated Other Comprehensive Income/(Loss)

(15) Accumulated Other Comprehensive Loss

The following tables provide the changes in AOCI by component, net of tax, for the years ended December 31, 2014 and 2013:

	Foreign Currency Translation Adjustments			Interest Rate Swap			Pension Plans			Total
Balance as of December 31, 2013	$	9,990		$	(396	)	$	(28,556	)	$	(18,962	)
Other comprehensive loss before reclassifications		(25,800	)		(99	)		(12,566	)		(38,465	)
Amounts reclassified from accumulated other comprehensive loss		4,400			302			7,744			12,446
Net current-period other comprehensive (loss)/income		(21,400	)		203			(4,822	)		(26,019	)
Balance as of December 31, 2014	$	(11,410	)	$	(193	)	$	(33,378	)	$	(44,981	)
	Foreign Currency Translation Adjustments			Interest Rate Swap			Pension Plans			Total
Balance as of December 31, 2012	$	5,177		$	(600	)	$	(38,668	)	$	(34,091	)
Other comprehensive income/(loss) before reclassifications		4,813			(85	)		9,173			13,901
Amounts reclassified from accumulated other comprehensive loss		-			289			939			1,228
Net current-period other comprehensive income		4,813			204			10,112			15,129
Balance as of December 31, 2013	$	9,990		$	(396	)	$	(28,556	)	$	(18,962	)

The following tables provide the reclassifications out of AOCI by component for the years ended December 31, 2014 and 2013:

Details about AOCI Components	Amount Reclassified from AOCI for the year ended December 31, 2014			Affected Line Item in the Consolidated Income Statement
Losses on cash flow hedge:
Interest rate swap	$	(465	)	Interest expense, net
		163		Tax benefit
	$	(302	)	Net of tax
Amortization of defined benefit pension items:
Loss on voluntary settlement	$	(7,170	)	Loss on voluntary pension settlement
Actuarial losses		(756	)	Selling, general and administrative expenses
Actuarial losses		(46	)	Cost of goods sold
Prior service costs		(52	)	Selling, general and administrative expenses
		(8,024	)	Total before tax
		280		Tax benefit
	$	(7,744	)	Net of tax
Foreign currency translation adjustment:
Release of currency translation adjustment	$	(4,400	)	Equity in losses of partially-owned affiliates
		-		Tax benefit
	$	(4,400	)	Net of tax
Total reclassification for the period	$	(12,446	)
Details about AOCI Components	Amount Reclassified from AOCI for the year ended December 31, 2013			Affected Line Item in the Consolidated Income Statement
Losses on cash flow hedge:
Interest rate swap	$	(444	)	Interest expense, net
		155		Tax benefit
	$	(289	)	Net of tax
Amortization of defined benefit pension items:
Actuarial losses	$	(1,223	)	Selling, general and administrative expenses
Actuarial losses		(116	)	Cost of goods sold
Prior service costs		(50	)	Selling, general and administrative expenses
		(1,389	)	Total before tax
		450		Tax benefit
	$	(939	)	Net of tax
Total reclassification for the period	$	(1,228	)

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Goodwill and Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2014

Goodwill and Intangible Assets [Abstract]

Change in carrying amount of goodwill

The changes in the carrying amount of goodwill for the years ended December 31, 2014 and 2013 are as follows:

Balance as of December 31, 2012	$	37,312
Translation effect		1,358
Balance as of December 31, 2013		38,670
Acquisition of business		9,715
Translation effect		(4,473	)
Balance as of December 31, 2014	$	43,912

Summary of acquired amortizable intangible assets

Acquired intangible assets, which are amortized, consist of the following:

		As of December 31, 2014
	Amortization Period	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Technology-based intangibles	10 - 20 years	$	8,228	$	(1,141	)	$	7,087
Internal-use software	7 years		1,332		-			1,332
Customer-related intangibles	10 - 15 years		716		(233	)		483
		$	10,276	$	(1,374	)	$	8,902

		As of December 31, 2013
	Amortization Period	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Technology-based intangibles	20 years	$	4,192	$	(786	)	$	3,406
Customer-related intangibles	10 - 15 years		814		(209	)		605
		$	5,006	$	(995	)	$	4,011

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Retirement Plans

12 Months Ended

Dec. 31, 2014

Retirement Plans [Abstract]

Retirement Plans

(17) Retirement Plans

Domestic Pension Plan

The Company maintains a defined-benefit pension plan (“Domestic Pension Plan”) for certain salaried and certain hourly employees.  The Company also has a Supplemental Executive Retirement Plan (“SERP”) for key executives.  This plan is non-qualified and unfunded.  Benefits accruing under both plans were frozen in 2007.  In July 2008, the Board of Directors of the Company amended the SERP to allow for lump sum payments effective January 1, 2009.  The lump sum value as of January 1, 2009 will be paid in 10 equal actuarial equivalent installments through 2018.  It is the Company’s policy to contribute to the domestic pension plan to ensure adequate funds are available in the plan to make benefit payments to plan participants and beneficiaries when required.

In the third quarter of 2014, the Company announced a program to offer a one-time option to elect to receive a voluntary lump-sum pension payout to certain former employees with deferred vested balances in the Company’s U.S. pension plan. As part of this voluntary lump-sum program, the Company settled $17,381 of pension obligations for the U.S. plan with an equal amount paid from plan assets. As a result, the Company recorded settlement losses of $7,170 reflecting the accelerated recognition of unamortized losses in the U.S. pension plan proportionate to the obligation that was settled. The loss on voluntary pension settlement is reflected as a separate line in the consolidated income statement with a corresponding balance sheet reduction in “Accumulated other comprehensive loss.”

International Pension Plans

A foreign subsidiary of the Company maintains a pension plan (“International Pension Plan”) for its employees that conforms to the common practice in that country.  Based on local laws and customs, this plan is unfunded.

Savings Plan

Cambrex makes available to all domestic employees a savings plan.  Employee contributions are matched in part by Cambrex.  The cost of this plan amounted to $941, $731 and $733 in 2014, 2013 and 2012, respectively.

Other

The Company has a non-qualified Deferred Compensation Plan for Key Executives (“The Plan”).  Under this Plan, officers and key employees may elect to defer all or any portion of their pre-tax earnings or elect to defer receipt of the Company’s stock which would otherwise have been issued upon the exercise of the Company’s options.  Included within other liabilities at December 31, 2014 and 2013 is $932 and $1,049, respectively, representing the Company’s obligation under the plan.  The Company invests in certain mutual funds and as such, included within other assets at December 31, 2014 and 2013 is $932 and $1,049, respectively, representing the fair value of these funds.  The fair values of these mutual funds are based on quoted market prices in active markets (Level 1).  The number of Cambrex shares held in trust under this plan as of December 31, 2014 and 2013 were 49,121, and are included as a reduction of equity.  The value of the shares held in trust and the corresponding liability of $1,062 and $876 at December 31, 2014 and 2013, respectively, have also been recorded in equity.  The Plan is not funded by the Company, but the Company has established a Deferred Compensation Trust Fund which holds the shares issued. Effective December 2011, the Board of Directors suspended employee contributions to this Plan.

The benefit obligations as of December 31, 2014 and 2013 are as follows:

	Pension Plans
	Domestic						SERP						International
	2014			2013			2014			2013			2014			2013
Change in benefit obligation
Benefit obligation, beginning of year	$	70,709		$	79,958		$	3,086		$	3,690		$	25,627		$	27,033
Service cost		-			-			-			-			674			743
Interest cost		3,310			3,057			33			41			884			658
Actuarial loss/(gain)		11,813			(8,269	)		2			(9	)		5,319			(2,314	)
Benefits paid		(3,160	)		(4,037	)		(732	)		(636	)		(763	)		(808	)
Currency translation affect		-			-			-			-			(5,041	)		315
Settlements		(17,847	)		-			-			-			-			-
Benefit obligation, end of year	$	64,825		$	70,709		$	2,389		$	3,086		$	26,700		$	25,627

The plan assets and funded status of the Domestic Pension Plan as of December 31, 2014 and 2013 are as follows:

	2014			2013
Change in plan assets
Fair value of plan assets, beginning of period	$	57,743		$	53,900
Actual return on plan assets		2,605			6,894
Contributions		2,324			986
Benefits paid		(3,160	)		(4,037	)
Settlements		(17,847	)		-
Fair value of plan assets, end of period	$	41,665		$	57,743
Unfunded status		(23,160	)		(12,966	)
Accrued benefit cost, end of period	$	(23,160	)	$	(12,966	)

The unfunded status of the SERP was ($2,389) and ($3,086) as of December 31, 2014 and 2013, respectively.  The unfunded status of the International Pension Plan was ($26,700) and ($25,627) as of December 31, 2014 and 2013, respectively.

The amounts recognized in AOCI as of December 31, 2014 and 2013 consist of the following:

	Pension Plans
	Domestic				SERP				International
	2014		2013		2014		2013		2014			2013
Actuarial loss	$	26,042	$	20,373	$	702	$	830	$	9,597		$	4,765
Prior service cost/(benefit)		-		-		172		230		(17	)		(24	)
Total	$	26,042	$	20,373	$	874	$	1,060	$	9,580		$	4,741

The components of net periodic benefit cost are as follows:

	Pension Plans
	Domestic									SERP						International
	2014			2013			2012			2014		2013		2012		2014			2013			2012
Components of net periodic benefit cost
Service cost	$	-		$	-		$	-		$	-	$	-	$	-	$	674		$	743		$	660
Interest cost		3,310			3,057			3,284			33		41		85		884			658			795
Expected return on plan assets		(4,153	)		(3,826	)		(3,674	)		-		-		-		-			-			-
Amortization of prior service cost/(benefit)		-			-			60			57		57		57		(7	)		(7	)		(7	)
Recognized actuarial loss		522			937			864			131		118		76		149			284			200
Settlement loss		7,170			-			-			-		-		-		-			-			-
Net periodic benefit cost	$	6,849		$	168		$	534		$	221	$	216	$	218	$	1,700		$	1,678		$	1,648

The estimated amounts that will be amortized from AOCI into net periodic benefit cost in 2015 are as follows:

	Pension Plans
	Domestic		SERP		International
Actuarial loss	$	811	$	154	$	359
Prior service cost/(benefit)		-		57		(6	)
Total	$	811	$	211	$	353

Major assumptions used in determining the benefit obligations are presented in the following table:

	2014	2013
Discount rate:
Domestic Pension Plan	3.85%	4.80%
SERP	1.35%	1.40%
International Pension Plan	2.40%	3.70%
Rate of compensation increase:
International Pension Plan	2.20%	2.50%

Major assumptions used in determining the net benefit cost are presented in the following table:

	2014	2013	2012
Discount rate:
Domestic Pension Plan	4.80%	3.90%	4.45%
SERP	1.40%	1.35%	2.40%
International Pension Plan	3.70%	3.40%	3.40%
Expected return on plan assets:
Domestic Pension Plan	7.25%	7.25%	7.50%
Rate of compensation increase:
International Pension Plan	2.20%	2.50%	2.40%

In making its assumption for the long-term rate of return on plan assets, the Company has utilized historical rates earned on securities allocated consistently with its investments.  The discount rate was selected by projecting cash flows associated with plan obligations, which were matched to a yield curve of high quality corporate bonds.  The Company then selected the single rate that produced the same present value as if each cash flow were discounted by the corresponding spot rate on the yield curve.

The aggregate Accumulated Benefit Obligation (“ABO”) of $64,825 exceeds plan assets by $23,160 as of December 31, 2014 for the Domestic Pension Plan.  The aggregate ABO is $25,459 for the International Pension Plan as of December 31, 2014.  The International Pension Plan is unfunded.

The Company expects to contribute approximately $1,900 in cash to the Domestic Pension Plan in 2015.  The Company does not expect to contribute cash to its International Pension Plan in 2015.

The following benefit payments are expected to be paid out of the plans:

	Pension Plans
	Domestic		SERP		International
2015	$	3,429	$	609	$	689
2016	$	3,401	$	609	$	699
2017	$	3,470	$	609	$	709
2018	$	3,400	$	609	$	767
2019	$	3,482	$	-	$	824
2020-2024	$	18,054	$	-	$	4,865

The investment objective for the Domestic Pension Plan’s assets is to achieve long-term growth with exposure to risk at an appropriate level.  The Company invests in a diversified asset mix consisting of equities (domestic and international) and taxable fixed income securities.  Assets are managed to obtain the highest total rate of return in keeping with a moderate level of risk.  The target allocations for plan assets are 30% - 80% equity securities, 25% - 45% U.S. fixed income and 5% - 15% all other investments.  Equity securities primarily include investments in large-cap and small-cap companies, U.S. fixed income securities including high quality corporate bonds, and U.S. government securities.  Other types of investments include real asset funds, consisting primarily of investments in commodities, and Treasury Inflation-Protected Securities (“TIPS”).

The fair values of the Company’s pension plan assets by asset category are as follows:

			Fair Value Measurements at December 31, 2014 using:
Asset Category	Total		(Level 1)		(Level 2)		(Level 3)
Equity securities:
U.S. companies	$	14,513	$	-	$	14,513	$	-
International companies		7,900		-		7,900		-
U.S. fixed income		14,093		-		11,964		2,129
Commodities		3,161		-		3,161		-
TIPS		1,998		-		1,998		-
	$	41,665	$	-	$	39,536	$	2,129
			Fair Value Measurements at December 31, 2013 using:
Asset Category	Total		(Level 1)		(Level 2)		(Level 3)
Equity securities:
U.S. companies	$	20,633	$	-	$	20,633	$	-
International companies		11,157		-		11,157		-
U.S. fixed income		18,736		-		16,660		2,076
Commodities		4,436		-		4,436		-
TIPS		2,781		-		2,781		-
	$	57,743	$	-	$	55,667	$	2,076

The following table sets forth a summary of the changes in the fair value of the Domestic Plan’s Level 3 assets, which are annuity contracts with an insurance company, for the year ended December 31, 2014:

	Group Annuity Contract
Balance at December 31, 2013	$	2,076
Net investment gain		53
Balance at December 31, 2014	$	2,129

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SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Doubtful trade receivables and returns and allowances [Member]
Valuation and qualifying accounts [Roll Forward]
Balance Beginning of Year	$ 1,058	$ 652	$ 450
Charged/(Credited) to Cost and Expenses	61	433	193
Charged/(Credited) to Other Accounts	(130)	27	12
Deductions	643	54	3
Balance End of Year	346	1,058	652
Deferred tax valuation allowance [Member]
Valuation and qualifying accounts [Roll Forward]
Balance Beginning of Year	29,890	29,941	77,571
Charged/(Credited) to Cost and Expenses	(26,543)	(97)	(45,105)
Charged/(Credited) to Other Accounts	1,706	46	(2,525)
Deductions	0	0	0
Balance End of Year	$ 5,053	$ 29,890	$ 29,941

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CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Cash flows from operating activities:
Net income	$ 57,303	$ 25,915	$ 62,303
Adjustments to reconcile net income to cash flows:
Depreciation and amortization	23,826	22,473	21,775
Non-cash deferred revenue	(17,873)	(10,093)	(238)
Loss on voluntary pension settlement	7,170	0	0
Increase in inventory reserve	5,343	2,329	2,790
Gain on sale of assets	(1,099)	(4,281)	(5)
Allowance for doubtful accounts	61	433	193
Stock based compensation	5,002	2,825	1,802
Deferred income tax provision	(16,025)	5,902	(40,712)
Equity in losses of partially-owned affiliates	4,623	2,262	1,766
Other	523	348	348
Changes in assets and liabilities:
Trade receivables	(8,955)	(27,707)	(6,310)
Inventories	(9,062)	(19,328)	(10,295)
Prepaid expenses and other current assets	(5,766)	(2,651)	(188)
Accounts payable and other current liabilities	12,369	10,107	3,134
Deferred revenue	11,773	18,644	10,748
Other non-current assets and liabilities	(2,387)	11,229	182
Discontinued operations:
Net cash used in discontinued operations	(1,858)	(1,533)	(3,747)
Net cash provided by operating activities	64,968	36,874	43,546
Cash flows from investing activities:
Capital expenditures	(23,323)	(57,320)	(18,156)
Proceeds from sale of assets	2,355	2,378	16
Advances to partially-owned affiliates	(1,404)	(1,655)	(2,047)
Acquisition of business and equity investment, net of cash acquired	(2,426)	0	0
Other	0	0	5
Net cash used in investing activities	(24,798)	(56,597)	(20,182)
Long-term debt activity (including current portion):
Borrowings	25,750	70,950	5,500
Repayments	(45,000)	(55,700)	(39,500)
Proceeds from stock options exercised	4,203	3,224	1,355
Other	522	(301)	(22)
Net cash (used in)/provided by financing activities	(14,525)	18,173	(32,667)
Effect of exchange rate changes on cash and cash equivalents	(2,872)	744	933
Net increase/(decrease) in cash and cash equivalents	22,773	(806)	(8,370)
Cash and cash equivalents at beginning of year	22,745	23,551	31,921
Cash and cash equivalents at end of year	45,518	22,745	23,551
Supplemental disclosure:
Interest paid, net of capitalized interest	2,068	2,325	2,556
Income taxes paid, net of refunds received	$ 6,725	$ 7,211	$ 5,068

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CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) In Thousands, except Share data, unless otherwise specified	Dec. 31, 2014	Dec. 31, 2013
Current assets:
Trade receivables, allowance for doubtful accounts	$ 346	$ 1,058
Stockholders' equity:
Common Stock, par value (in dollars per share)	$ 0.10	$ 0.10
Common Stock, shares authorized (in shares)	100,000,000	100,000,000
Common Stock, shares issued (in shares)	32,836,930	32,240,795
Treasury stock, at cost (in shares)	1,738,624	1,757,530

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Income Taxes

12 Months Ended

Dec. 31, 2014

Income Taxes [Abstract]

Income Taxes

(10) Income Taxes

Income before income taxes consists of the following:

	December 31,
	2014		2013		2012
Domestic	$	37,211	$	23,068	$	13,525
International		8,295		21,939		17,843
Total	$	45,506	$	45,007	$	31,368

The provision for income taxes consist of the following provisions/(benefits):

	December 31,
	2014			2013		2012
Current:
Federal	$	2,572		$	630	$	(177	)
State		-			15		4
International		512			5,980		8,525
		3,084			6,625		8,352
Deferred:
Federal	$	(14,965	)	$	7,014	$	(36,287	)
International		(746	)		1,093		(3,926	)
		(15,711	)		8,107		(40,213	)
Total	$	(12,627	)	$	14,732	$	(31,861	)

The (benefit)/provision for income taxes differs from the statutory federal income tax rate of 35% for 2014, 2013 and 2012 as follows:

	December 31,
	2014			2013			2012
Income tax provision at U.S federal statutory rate	$	15,927		$	15,752		$	10,979
Effect of foreign income taxed at rates other than the U.S. federal statutory rate		751			242			(451	)
Foreign income inclusions		2,742			-			4,563
Tax credits		(2,692	)		(250	)		(177	)
Changes in tax laws		-			(1,155	)		(1,329	)
Tax audit settlements		(3,948	)		-			-
Net change in valuation allowance		(26,543	)		(97	)		(45,105	)
Permanent items and other		1,136			240			(341	)
Total	$	(12,627	)	$	14,732		$	(31,861	)

Foreign income inclusions represent distributions from foreign subsidiaries which give rise to newly recognized foreign tax credits.  In 2012, the Company utilized fully valued foreign tax credits, alternative minimum tax credits, and research and experimentation tax credits, prior to the release of the domestic valuation allowance, to completely offset any tax impact of the foreign income inclusions.  Tax audit settlements in 2014 include the final settlement of the European tax dispute that arose in 2009.  Net change in the valuation allowance in 2014 includes the benefit of $26,902 for the remaining release of the domestic valuation allowance attributable to foreign tax credits, offset by $142 for state deferred taxes and $217 for foreign deferred taxes subject to valuation allowances.  Net change in the valuation allowance in 2012 includes the benefit of $36,287 for the partial release of the domestic valuation allowance, the reduction in the domestic valuation allowance, prior to the release, for the utilization of fully valued tax credits to offset U.S. income tax and deferred tax amounts of $8,660, and the reduction in the foreign valuation allowance of $158.

The components of deferred tax assets and liabilities as of December 31, 2014 and 2013 relate to temporary differences and carryforwards as follows:

	December 31,
	2014			2013
Deferred tax assets:
Inventory	$	3,313		$	2,510
Foreign tax credit carryforwards		19,925			31,463
Environmental		2,993			2,995
Net operating loss carryforwards (foreign)		3,381			944
Employee benefits		18,879			12,841
Research & experimentation tax credit carryforwards		480			1,900
Alternative minimum tax credit carryforwards		2,773			2,773
Property, plant and equipment		3,898			3,843
Other		5,605			4,037
Total gross deferred tax assets		61,247			63,306
Valuation allowance		(5,053	)		(29,890	)
Total deferred tax assets	$	56,194		$	33,416
Deferred tax liabilities:
Property, plant and equipment		(9,649	)		(9,059	)
Intangibles and other		(10,487	)		(9,856	)
Unremitted foreign earnings		(726	)		(568	)
Foreign tax allocation reserve		(1,856	)		(2,006	)
Other		(1,978	)		(2,187	)
Total deferred tax liabilities	$	(24,696	)	$	(23,676	)
Net deferred tax asset	$	31,498		$	9,740
Classified as follows in the consolidated balance sheet:
Current deferred tax asset (included in other current assets)		3,808			2,874
Non-current deferred tax asset		38,424			19,799
Current deferred tax liability (included in other current liabilities)		(189	)		(98	)
Non-current deferred tax liability		(10,545	)		(12,835	)
	$	31,498		$	9,740

The Company establishes a valuation allowance against deferred tax assets when it is more likely than not that the Company will be unable to realize those deferred tax assets in the future. In 2003, the Company’s assessment of the need for a valuation allowance against domestic deferred tax assets considered current and past performance, cumulative losses in recent years from domestic operations, and a shift in the geographic mix of forecasted income.  Considering the pattern of then-recent domestic losses, the Company gave significant weight to projections showing future domestic losses for purposes of assessing the need for a valuation allowance.  This assessment resulted in a determination that it was more likely than not that domestic deferred tax assets would not be realized, and as such, a valuation allowance against net domestic deferred tax assets was recorded.

A sustained period of domestic profitability along with expectations of future domestic profitability of sufficient amounts and character was required before the Company concluded that it was more likely than not that the domestic deferred tax assets would be realized, and as such, that there was no longer the need for a full valuation allowance against net domestic deferred tax assets. During 2012, the Company concluded that its three-year cumulative domestic profitability through the end of 2012 and expectations of future domestic profitability warranted the reversal of all of the domestic valuation allowance attributable to net federal temporary differences, alternative minimum tax credits, and research and experimentation tax credits.  Additionally, the Company released a portion of the domestic valuation allowance attributable to federal foreign tax credits.  These valuation allowance releases resulted in a tax benefit to continuing operations of $36,287 in 2012.

During 2014, the Company received updated customer projections that impact current and future years’ U.S. taxable income in amounts and type that support the utilization of federal foreign tax credits.  For the first nine months of 2014, the expected impact in the current year and future years of these updated projections resulted in the Company releasing $15,183 of valuation allowance against foreign tax credits.  Additional updates of customer projections received by the Company during the fourth quarter of 2014 resulted in the release of the remaining valuation allowance against foreign tax credits of $11,719.  The Company currently expects to maintain a domestic valuation allowance against state tax credits and deferred tax assets due to restrictive rules regarding realization.  The Company expects to maintain a valuation allowance against certain foreign tax assets, primarily NOL carryforwards, until such time as the Company attains an appropriate level of future profitability in the appropriate jurisdictions and is able to conclude that it is more likely than not that its foreign deferred tax assets are realizable.

The domestic valuation allowance for the years ended December 31, 2014, 2013 and 2012 decreased $26,760, $3 and $47,490, respectively. The 2014 decrease in the domestic valuation allowance was allocated as follows: the valuation allowance decreased $26,902 for the release of valuation allowance due to domestic profitability and increased $142 due to domestic state items.  The 2013 decrease in the domestic valuation allowance is due to domestic state items.  The 2012 decrease in the domestic valuation allowance was allocated as follows: the valuation allowance decreased $36,287 for the release of valuation allowance due to domestic profitability, decreased by a net amount of $8,660 for domestic income and deferred tax amounts in continuing operations prior to the release of valuation allowance in the fourth quarter of 2012, and decreased by a net amount of $2,543 for domestic gains and losses included in OCI and discontinued operations.

The foreign valuation allowance for the years ended December 31, 2014, 2013 and 2012 increased $1,923, decreased $48, and decreased $140, respectively.  The 2014 increase in the foreign valuation allowance was allocated as follows: the valuation allowance increased $217 for foreign income and increased $1,706 for deferred tax amounts and currency translation adjustments included in OCI. The 2013 decrease in the foreign valuation allowance was allocated as follows: the valuation allowance decreased $94 for foreign income and increased $46 for deferred tax amounts and currency translation adjustments included in OCI.  The 2012 decrease in the foreign valuation allowance was allocated as follows: the valuation allowance decreased $158 for foreign income and increased $18 for deferred tax amounts and currency translation adjustments included in OCI.

Under the tax laws of the various jurisdictions in which the Company operates, NOLs may be carried forward or back, subject to statutory limitations, to reduce taxable income in future or prior years.  Foreign NOLs are approximately $11,323, of which $8,778 are attributable to NOLs acquired during 2014. NOLs in most foreign jurisdictions will carry forward indefinitely.

As of December 31, 2014, $19,925 of domestic federal foreign tax credits, $480 of research and experimentation tax credits and $2,773 of alternative minimum tax credits are available as credits against future U.S. income taxes on worldwide income, subject to certain limitations. Under U.S. tax laws, these will expire in 2015 through 2018, 2033 through 2034, and the alternative minimum tax credit carryforwards have no expiration date, respectively.

In 2014 and 2012, the Company repatriated $5,442 and $8,953, respectively, of cash from its foreign subsidiaries in order to reduce its credit and currency exposure for cash held in foreign currencies or in non-U.S. banks and utilized the excess cash for debt reduction.  The Company utilized fully valued domestic tax credits in 2012 to completely offset any tax impact of the foreign income inclusion.  Historically, the Company intended to reinvest foreign earnings indefinitely outside of the U.S. and only considered repatriating excess cash from foreign subsidiaries if it could utilize fully valued domestic tax attributes to completely offset any tax expense that would otherwise result. Unrecognized foreign tax credits and fully valued foreign tax credit carryovers had been available to offset any potential U.S. tax liability.  Therefore, the Company had not provided U.S. federal or state income taxes or foreign withholding taxes on its undistributed earnings from foreign operations prior to 2012.  During the fourth quarter of 2012 the Company completed a detailed forecast of foreign source income by jurisdiction as part of the ongoing process to evaluate its valuation allowance against deferred tax assets.  As part of this process, as well as a continuing desire to limit its credit and currency exposure related to cash held in foreign currencies or in non-U.S. banks, the Company determined that it is likely that a portion of the undistributed earnings of its foreign subsidiaries will be repatriated to the U.S. in the future.  Accordingly, in 2012 the Company changed its indefinite reinvestment assertion.  The Company has provided a deferred tax liability of $726 on certain undistributed foreign earnings as of December 31, 2014. Subject to limitations, U.S. income tax on such foreign earnings, when actually repatriated, may be reduced or eliminated by unrecognized foreign tax credits that may be generated in connection with the repatriation or by existing foreign tax credit carryforwards or other tax attributes for which a valuation allowance was released in 2012 and 2014.  The Company monitors available evidence and its plans for foreign earnings and expects to continue to provide deferred taxes based on the tax liability that would be due upon repatriation of amounts not considered permanently reinvested.

The following table summarizes the activity related to the Company’s unrecognized tax benefits as of December 31, 2014, 2013 and 2012:

	2014			2013			2012
Balance at January 1	$	3,922		$	3,967		$	4,328
Gross increases related to current period tax positions		275			257			348
Gross decreases related to prior period tax positions		(1,149	)		(427	)		(483	)
Expirations of statute of limitations for the assessment of taxes		(106	)		(37	)		(113	)
Settlements		(1,113	)		-			(175	)
Foreign currency translation		(186	)		162			62
Balance at December 31	$	1,643		$	3,922		$	3,967

Of the total balance of unrecognized tax benefits at December 31, 2014, $1,643, if recognized, would affect the effective tax rate.

Gross interest and penalties at December 31, 2014, 2013 and 2012 of $489, $5,005 and $4,511, respectively, related to the above unrecognized tax benefits are not reflected in the table above.  In 2014, 2013 and 2012, the Company accrued $337, $219 and $985, respectively, of interest and penalties in the income statement.  Consistent with prior periods, the Company recognizes interest and penalties within its income tax provision.

Tax years 2011 and forward in the U.S. are open to examination by the IRS.  The Company is also subject to examinations in its non-U.S. jurisdictions for 2009 and later years.

The Company is also subject to audits in various states for various years in which it has filed income tax returns.  Previous state audits have resulted in immaterial adjustments.  In the majority of states where the Company files, the Company is subject to examination for tax years 2010 and forward.

In 2009, a subsidiary of the Company was examined by a European tax authority, which challenged the business purpose of the deductibility of certain intercompany transactions from 2003 and issued formal assessments against the subsidiary.  The Company had several favorable rulings in the courts on this matter, although the rulings were appealed by the tax authority.  At the same time, considering the hazards of litigation, the Company pursued settlement negotiations.  During the fourth quarter of 2014, the Company entered into a final settlement with the tax authority in order to avoid further litigation, without any admission of fault or breach of law.  The settlement required the Company to pay $1,487 in tax and interest during the fourth quarter of 2014 in full satisfaction of all liabilities for this matter, and in response the tax authority withdrew all pending litigation and renounced any outstanding claims.  The settlement did not impose any penalties on the Company. Therefore, in the fourth quarter of 2014, the Company decreased its remaining reserve for unrecognized tax benefits for this matter by $4,137.

In the next twelve months, the Company may increase its reserve for unrecognized tax benefits for intercompany transactions and acquired tax attributes by approximately $250.  This could affect the effective tax rate.

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Document and Entity Information (USD $)	12 Months Ended
	Dec. 31, 2014	Jan. 30, 2015	Jun. 30, 2014
Document and Entity Information [Abstract]
Entity Registrant Name	CAMBREX CORP
Entity Central Index Key	0000820081
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Public Float			$ 620,956,613
Entity Common Stock, Shares Outstanding		31,098,306
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	FY
Document Type	10-K
Amendment Flag	false
Document Period End Date	Dec. 31, 2014

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Long-term Debt

12 Months Ended

Dec. 31, 2014

Long-term Debt [Abstract]

Long-term Debt

(11) Long‑term Debt

In November 2011, the Company entered into a $250,000 five-year Syndicated Senior Revolving Credit Facility (“Credit Facility”) which expires in November 2016.  The Company pays interest on this Credit Facility at LIBOR plus 1.50% - 2.10% based upon certain financial measurements.  The Credit Facility also includes financial covenants regarding interest coverage and leverage ratios.  The Company was in compliance with all financial covenants at December 31, 2014.   As of December 31, 2014, there was $60,000 outstanding on the Credit Facility.  As of December 31, 2013, there was $79,250 outstanding on the Credit Facility.  The 2014 and 2013 weighted average interest rate for long-term bank debt was 2.4% and 2.3%, respectively.

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CONSOLIDATED INCOME STATEMENTS (USD $) In Thousands, except Per Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
CONSOLIDATED INCOME STATEMENTS [Abstract]
Gross Sales	$ 374,150	$ 317,212	$ 277,931
Commissions, allowances and rebates	2,306	1,351	2,503
Net sales	371,844	315,861	275,428
Other revenues	2,769	2,315	1,073
Net revenues	374,613	318,176	276,501
Cost of goods sold	250,815	215,272	186,014
Gross profit	123,798	102,904	90,487
Selling, general and administrative expenses	52,489	47,568	45,248
Research and development expenses	13,075	10,387	9,544
Total operating expenses	65,564	57,955	54,792
Loss on voluntary pension settlement	7,170	0	0
Gain on sale of asset	(1,234)	(4,680)	0
Operating profit	52,298	49,629	35,695
Other expenses/(income)
Interest expense, net	2,174	2,242	2,439
Equity in losses of partially-owned affiliates	4,623	2,262	1,766
Other (income)/expenses, net	(5)	118	122
Income before income taxes	45,506	45,007	31,368
(Benefit)/provision for income taxes	(12,627)	14,732	(31,861)
Income from continuing operations	58,133	30,275	63,229
Loss from discontinued operations, net of tax	(830)	(4,360)	(926)
Net income	$ 57,303	$ 25,915	$ 62,303
Basic earnings per share
Income from continuing operations (in dollars per share)	$ 1.89	$ 1.00	$ 2.13
Loss from discontinued operations, net of tax (in dollars per share)	$ (0.03)	$ (0.14)	$ (0.03)
Net income (in dollars per share)	$ 1.86	$ 0.86	$ 2.10
Diluted earnings per share
Income from continuing operations (in dollars per share)	$ 1.84	$ 0.98	$ 2.09
Loss from discontinued operations, net of tax (in dollars per share)	$ (0.03)	$ (0.14)	$ (0.03)
Net income (in dollars per share)	$ 1.81	$ 0.84	$ 2.06
Weighted average shares outstanding:
Basic weighted average shares outstanding (in shares)	30,763	30,150	29,703
Effect of dilutive stock based compensation (in shares)	880	751	611
Diluted weighted average shares outstanding (in shares)	31,643	30,901	30,314

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Net Inventories

12 Months Ended

Dec. 31, 2014

Net Inventories [Abstract]

Net Inventories

(5) Net Inventories

Inventories are stated at the lower of cost, determined on a first-in, first-out basis, or market.

Net inventories consist of the following:

	December 31,
	2014		2013
Finished goods	$	24,200	$	29,797
Work in process		27,640		31,990
Raw materials		28,558		22,580
Supplies		5,232		5,598
Total	$	85,630	$	89,965

The components of inventory stated above are net of reserves of $12,878 and $11,496 as of December 31, 2014 and 2013, respectively.

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Acquisitions

12 Months Ended

Dec. 31, 2014

Acquisition [Abstract]

Acquisition

(4) Acquisitions

In May 2014, the Company purchased the remaining 49% interest in the stock of Zenara.  The Company negotiated an accelerated purchase of the business, which was contractually required to be completed in 2016 at a price that would have been determined by the financial performance of the Zenara business.  The purchase price negotiated for the 49% was $2,680.  Management believed it was economically beneficial to take control of the business to accelerate the execution of the Company’s strategy for the business.  The Company recorded $655 for the identifiable net liabilities of Zenara at fair market value, intangible assets of $4,900, a deferred tax liability related to the intangible asset of $1,666 and goodwill of $9,715.   The Company incurred acquisition related costs of $460 for the year ended December 31, 2014. These costs were expensed and included in “Selling, general and administrative expenses” in the Company’s income statement.  Proforma financial information is not required as this acquisition is not material.  Refer to Note 8 for further disclosure.

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Stock Based Compensation

12 Months Ended

Dec. 31, 2014

Stock Based Compensation [Abstract]

Stock Based Compensation

(16) Stock Based Compensation

The Company recognizes compensation cost for stock options awarded to employees based on their grant-date fair value.  The value of each stock option is estimated on the date of grant using the Black-Scholes option-pricing model.  The weighted-average fair value per share for the stock options granted to employees for the years ended December 31, 2014, 2013 and 2012 were $7.15, $7.97 and $7.14, respectively.

The following assumptions were used in determining the fair value of stock options for grants issued in 2014, 2013 and 2012:

	2014	2013	2012
Expected volatility	35.14%-46.32%	44.17%-71.58%	71.84%
Expected term	1.75-4.75 years	1.25-4.75 years	4.75 years
Risk-free interest rate	0.43%-1.50%	0.12%-1.37%	0.66%

The Company does not have any publicly traded stock options; therefore, expected volatilities are based on historical volatility of the Company’s stock.  The risk-free interest rate is based on the yield of a zero-coupon U.S. Treasury bond whose maturity period approximates the option’s expected term.  The expected term was utilized based on the “simplified” method for determining the expected term of stock options.

For 2014, 2013, and 2012, the Company recorded $2,491, $1,994 and $1,303, respectively, in selling, general and administrative expenses for stock options.  As of December 31, 2014, the total compensation cost related to unvested stock option awards granted to employees but not yet recognized was $7,197.  The cost will be amortized on a straight-line basis over the remaining weighted-average vesting period of 2.8 years.

The following table is a summary of the Company’s stock option activity issued to employees and related information:

				Weighted Average
	Number of Shares			Exercise Price		Options Exercisable
Outstanding at December 31, 2013		2,229,969		$	9.39		1,149,069
Granted		479,788			18.12
Exercised		(596,135	)		7.05
Forfeited or expired		(42,950	)		10.12
Outstanding at December 31, 2014		2,070,672			12.08
Exercisable at December 31, 2014		971,797		$	8.71

The aggregate intrinsic value for all stock options exercised for the years ended December 31, 2014, 2013 and 2012 was $8,910, $5,017 and $1,658, respectively.  The aggregate intrinsic values for all stock options outstanding and exercisable as of December 31, 2014 were $19,766 and $12,546, respectively.

A summary of the Company’s nonvested stock options and restricted stock activity is presented below:

	Nonvested Stock Options					Nonvested Restricted Stock
	Number of Shares			Weighted- Average Grant- Date Fair Value		Number of Shares			Weighted- Average Grant- Date Fair Value
Nonvested at December 31, 2013		1,080,900		$	6.50		-		$	-
Granted		479,788			7.15		18,906			20.90
Vested during period		(431,413	)		5.60		(18,906	)		20.90
Forfeited		(30,400	)		6.44		-			-
Nonvested at December 31, 2014		1,098,875		$	7.14		-		$	-

Members of the Cambrex Board of Directors currently participate in an incentive plan which rewards service with restricted stock units.  Awards are made annually and vest over six months.  On the six month anniversary of the grant, restrictions on sale or transfer are removed and shares are issued to the Directors.  These awards are classified as equity awards.

For 2014, 2013, and 2012, the Company recorded $395, $427, and $446, respectively, in selling, general and administrative expenses for restricted stock units.  As of December 31, 2014, all restricted stock unit grants were fully vested.

The Company granted equity-settled performance shares (“PSs”) to certain executives.  PS awards provide the recipient the right to receive a certain number of shares of the Company’s common stock in the future, which depends on the Company’s level of achievement of revenue and EBITDA growth as compared to the revenue and EBITDA growth of the members of a specified peer group of companies over a three year period.  The peer group consists of publicly-traded life sciences companies competing in the same industry as the Company.  For 2014, 2013 and 2012, the Company recorded $2,116, $404 and $53, respectively, in selling, general and administrative expense related to these PS awards.

The Company granted cash-settled performance share units (“PSUs”) to certain executives.  PSU awards provide the recipient the right to receive the cash value of a certain number of shares of the Company’s common stock in the future, which depends on the Company’s level of achievement of revenue and EBITDA growth as compared to the revenue and EBITDA growth of the members of a specified peer group of companies typically over a three year period.  The peer group consists of publicly-traded life sciences companies competing in the same industry as the Company.  For 2014, 2013 and 2012, the Company recorded $445, $2,620 and $1,529, respectively, in selling, general and administrative expenses for PSU awards.  The decrease is primarily the result of the Company’s performance compared to the peer group partially offset by the Company’s higher share price.

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Derivatives and Hedging Activities

12 Months Ended

Dec. 31, 2014

Derivatives and Hedging Activities [Abstract]

Derivatives and Hedging Activities

(12) Derivatives and Hedging Activities

The Company operates internationally and is exposed to fluctuations in foreign exchange rates and interest rates in the normal course of business.  The Company, from time to time, uses derivatives to reduce exposure to market risks resulting from fluctuations in interest rates and foreign exchange rates.

All financial instruments involve market and credit risks.  The Company is exposed to credit losses in the event of non-performance by the counterparties to the contracts.  While there can be no assurance, the Company does not anticipate non-performance by these counterparties.

Foreign Currency Forward Contracts

The Company periodically enters into foreign currency forward contracts to protect against currency fluctuations of forecasted cash flows and existing balance sheet exposures at its foreign operations, as deemed appropriate.  The Company may or may not elect to designate certain forward contracts for hedge accounting treatment.

For derivatives that are not designated for hedge accounting treatment, changes in the fair value are immediately recognized in earnings. This treatment has the potential to increase volatility of the Company’s earnings.

None of the foreign currency forward contracts entered into during 2014 were designated for hedge accounting treatment.  The notional amounts of the Company’s foreign exchange forward contracts were $3,632 at December 31, 2014.  There were no foreign currency forward contracts outstanding at December 31, 2013 and 2012. The Company does not hold or purchase any foreign currency forward contracts for trading or speculative purposes and no contractual term is greater than twelve months.

The fair value of the Company’s foreign exchange forward contracts was a loss of $102 at December 31, 2014 and is recorded in “Accrued expenses and other current liabilities” and “Other revenue.”

Interest Rate Swap

The Company entered into an interest rate swap in March 2012 to reduce the impact of changes in interest rates on its floating rate debt through September 2015.  The swap is a contract to exchange floating rate for fixed interest payments periodically over the life of the agreement without the exchange of the underlying notional debt amount.

The swap contract outstanding at December 31, 2014 has been designated as a cash flow hedge and, accordingly, changes in the fair value of this derivative are not recorded in earnings but are recorded each period in AOCI and reclassified into earnings as interest expense in the same period during which the hedged transaction affects earnings.  The ineffective portion of all hedges is recognized in earnings and has been immaterial to the Company's financial results.

As of December 31, 2014, the interest rate swap had a notional value of $60,000, at a fixed rate of 0.92%.  The fair value of this swap is based on quoted market prices and was in a loss position of $304, $616 and $930 at December 31, 2014, 2013 and 2012, respectively.  This loss is reflected in the Company’s balance sheet under the caption “Accrued expenses and other current liabilities.”

Assuming current market conditions continue, the entire loss will be reclassed out of AOCI into earnings within the next twelve months.

Refer to Note 13 to the Company’s consolidated financial statements for the summary table containing the fair value of the Company’s financial instruments.

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Partially-Owned Affiliates

12 Months Ended

Dec. 31, 2014

Partially-Owned Affiliates [Abstract]

Partially-Owned Affiliates

(8) Partially-Owned Affiliates

In May 2014, the Company negotiated an accelerated purchase of Zenara, which was contractually required to be completed in 2016 at a price that would have been determined by the financial performance of the business. The purchase price negotiated for the remaining 49% was $2,680.  Management believed it was economically beneficial to take control of the business to accelerate the execution of the Company’s strategy for the business. The Company incurred acquisition related costs of $460 for the year ended December 31, 2014.

The Company was required to perform a fair market value assessment immediately before acquisition of its existing 51% ownership interest.  This resulted in the recognition of a gain of $278 using a discounted cash flow model with inputs developed by Company management.  The Company also recorded an expense of $4,400 representing the release of foreign currency translation adjustments previously recorded in “Other comprehensive income” that are now required to be recorded to the income statement as a result of the removal of the investment in partially-owned affiliate due to the full consolidation of Zenara as of the acquisition date.  The net amount of these items totaled a loss of $4,122 and is recorded in “Equity in losses of partially-owned affiliates” on the Company’s income statement.

The Company recorded a loss of $458 related to Zenara and reflects activity through the date the remaining 49% was purchased.  This amount includes amortization expense of $333. The impact of its partial ownership stake in Zenara was a loss of $1,956 and $1,976 in 2013 and 2012, respectively, and is located within “Other expenses/(income)” as “Equity in losses of partially-owned affiliates” on the Company’s income statement.  These amounts include amortization expense of $882 and $965 in 2013 and 2012, respectively, and depreciation expense of $130 and $132 in 2013 and 2012, respectively.  During 2014 the Company advanced $1,282 to Zenara through the purchase date.  The Company advanced $1,514 and $1,594 to Zenara in 2013 and 2012, respectively.

The Company’s financial statements reflect its share of Zenara’s results through the date the Company purchased the remaining 49% interest at which time Zenara became a wholly-owned subsidiary of the Company and included in the consolidated financial statements.  Partially-owned affiliates also includes two smaller joint ventures located in Europe and Brazil.   Investments in and advances to partially-owned affiliates were not material to the Company’s consolidated financial statements as of December 31, 2014.

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Stock Based Compensation (Details) (USD $) In Thousands, except Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected volatility (in hundredths)			71.84%
Expected term			4 years 9 months
Risk-free interest rate (in hundredths)			0.66%
Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected volatility (in hundredths)	35.14%	44.17%
Expected term	1 year 9 months	1 year 3 months
Risk-free interest rate (in hundredths)	0.43%	0.12%
Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected volatility (in hundredths)	46.32%	71.58%
Expected term	4 years 9 months	4 years 9 months
Risk-free interest rate (in hundredths)	1.50%	1.37%
Stock Options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted-average fair value per share (in dollars per share)	$ 7.15	$ 7.97	$ 7.14
Number of Shares [Roll Forward]
Outstanding, beginning balance (in shares)	2,229,969
Granted (in shares)	479,788
Exercised (in shares)	(596,135)
Forfeited or expired (in shares)	(42,950)
Outstanding, ending balance (in shares)	2,070,672	2,229,969
Options exercisable (in shares)	971,797	1,149,069
Weighted Average Exercise Price [Roll Forward]
Outstanding, beginning balance (in dollars per share)	$ 9.39
Granted (in dollars per share)	$ 18.12
Exercised (in dollars per share)	$ 7.05
Forfeited or expired (in dollars per share)	$ 10.12
Outstanding, ending balance (in dollars per share)	$ 12.08	$ 9.39
Exercisable, ending balance (in dollars per share)	$ 8.71
Aggregate intrinsic value exercised	$ 8,910	$ 5,017	$ 1,658
Aggregate intrinsic value outstanding	19,766
Aggregate intrinsic value exercisable	12,546
Stock Options [Member] | Selling, General and Administrative Expenses [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock option expense	2,491	1,994	1,303
Stock Options [Member] | Unvested [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total compensation cost related to unvested share-based awards not yet recognized	7,197
Weighted average vesting period	2 years 9 months 18 days
Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Performance period	6 months
Nonvested Restricted Stock Number of Shares [Roll Forward]
Nonvested, beginning balance (in shares)	0
Granted (in shares)	18,906
Vested during period (in shares)	(18,906)
Forfeited (in shares)	0
Nonvested, ending balance (in shares)	0
Nonvested Restricted Stock, Weighted-Average Grant-Date Fair Value [Roll Forward]
Nonvested, beginning balance (in dollars per share)	$ 0
Granted (in dollars per share)	$ 20.90
Vested during period (in dollars per share)	$ 20.90
Forfeited (in dollars per share)	$ 0
Nonvested, ending balance (in dollars per share)	$ 0
Restricted Stock [Member] | Selling, General and Administrative Expenses [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock expense	395	427	446
Nonvested Stock Option [Member]
Nonvested Stock Options, Number of Shares [Roll Forward]
Nonvested, beginning balance (in shares)	1,080,900
Granted (in shares)	479,788
Vested during period (in shares)	(431,413)
Forfeited (in shares)	(30,400)
Nonvested, ending balance (in shares)	1,098,875
Nonvested Stock Options, Weighted-Average Grant-Date Fair Value [Roll Forward]
Nonvested, beginning balance (in dollars per share)	$ 6.50
Granted (in dollars per share)	$ 7.15
Vested during period (in dollars per share)	$ 5.60
Forfeited (in dollars per share)	$ 6.44
Nonvested, ending balance (in dollars per share)	$ 7.14
Performance shares [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Performance period	3 years
Performance shares [Member] | Selling, General and Administrative Expenses [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Performance share expense	2,116	404	53
Cash Settled Performance Share units [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Performance period	3 years
Cash Settled Performance Share units [Member] | Selling, General and Administrative Expenses [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Performance share unit expense	$ 445	$ 2,620	$ 1,529

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Property, Plant and Equipment

12 Months Ended

Dec. 31, 2014

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment

(6) Property, Plant and Equipment

Property, plant and equipment consist of the following:

	December 31,
	2014			2013
Land	$	4,117		$	4,312
Buildings and improvements		103,083			108,460
Machinery and equipment		365,623			398,490
Furniture and fixtures		1,821			1,884
Construction in progress		20,085			16,808
Total		494,729			529,954
Accumulated depreciation		(331,162	)		(357,988	)
Net	$	163,567		$	171,966

Depreciation expense was $23,296, $22,218 and $21,528 for the years ended December 31, 2014, 2013 and 2012, respectively.  Total capital expenditures in 2014 and 2013 were $29,898 and $41,600, respectively.

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Goodwill and Intangible Assets

12 Months Ended

Dec. 31, 2014

Goodwill and Intangible Assets [Abstract]

Goodwill and Intangible Assets

(7) Goodwill and Intangible Assets

The changes in the carrying amount of goodwill for the years ended December 31, 2014 and 2013 are as follows:

Balance as of December 31, 2012	$	37,312
Translation effect		1,358
Balance as of December 31, 2013		38,670
Acquisition of business		9,715
Translation effect		(4,473	)
Balance as of December 31, 2014	$	43,912

Acquired intangible assets, which are amortized, consist of the following:

		As of December 31, 2014
	Amortization Period	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Technology-based intangibles	10 - 20 years	$	8,228	$	(1,141	)	$	7,087
Internal-use software	7 years		1,332		-			1,332
Customer-related intangibles	10 - 15 years		716		(233	)		483
		$	10,276	$	(1,374	)	$	8,902

		As of December 31, 2013
	Amortization Period	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Technology-based intangibles	20 years	$	4,192	$	(786	)	$	3,406
Customer-related intangibles	10 - 15 years		814		(209	)		605
		$	5,006	$	(995	)	$	4,011

The change in the gross carrying amount is related to the acquisition of the remaining 49% of Zenara and the impact of foreign currency translation.  The acquisition resulted in the recognition of technology- based intangibles of $4,900 in the second quarter of 2014. During 2014, the Company began implementing a new enterprise resource planning system, as such, $1,332 has been capitalized and classified as internal-use software.

Amortization expense amounted to $530, $255 and $247 for the years ended December 31, 2014, 2013 and 2012, respectively.

Amortization expense related to current intangible assets is expected to be approximately $757 for 2015 and $884 for each of the next four years.

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Accrued Expense and Other Current Liabilities

12 Months Ended

Dec. 31, 2014

Accrued Expenses And Other Current Liabilities [Abstract]

Accrued Expenses and Other Current Liabilities

(9) Accrued Expense and Other Current Liabilities

The components of accrued expenses and other current liabilities are as follows:

	December 31,
	2014		2013
Salaries and employee benefits payable	$	26,893	$	26,211
Taxes payable and related reserves		5,420		10,168
Other		8,701		11,719
Total	$	41,014	$	48,098

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Contingencies (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2008 Plaintiff	Dec. 31, 2003	Dec. 31, 2013
Components of Environmental Loss Accrual [Abstract]
Reserve for estimated environmental and remediation costs	$ 9,595			$ 10,881
Payments against reserves for estimated environmental and remediation costs	2,269
Adjustment to environmental and remediation reserves	1,209
Impact of currency translation on environmental and remediation reserves	226
Lorazepam and Clorazepate [Member]
Loss Contingencies [Line Items]
Number of plaintiffs in unresolved case		4
Judgment Amount Against Parties Payable Jointly And Severally		19,200
Punitive damages award		16,709
Loss contingency, prejudgment interest		7,500
Pending increase (decrease) in damages award value	(9,600)
Lorazepam and Clorazepate [Member] | Indemnification Agreement [Member]
Loss Contingencies [Line Items]
Payment in exchange for release and full indemnity against future cost or liabilities			12,415
Lorazepam and Clorazepate [Member] | Surety Bond [Member]
Loss Contingencies [Line Items]
Surety bond amount			66,632
CasChem [Member]
Components of Environmental Loss Accrual [Abstract]
Reserve for estimated environmental and remediation costs	193
Berry's Creek Site [Member]
Components of Environmental Loss Accrual [Abstract]
Reserve for estimated environmental and remediation costs	388
Number of former subsidiaries for which notice was received	2
Maybrook Site [Member]
Components of Environmental Loss Accrual [Abstract]
Reserve for estimated environmental and remediation costs	322
Harriman Site [Member]
Components of Environmental Loss Accrual [Abstract]
Reserve for estimated environmental and remediation costs	3,615
Harriman Site [Member] | Minimum [Member]
Components of Environmental Loss Accrual [Abstract]
Estimated remediation expense	2,000
Harriman Site [Member] | Maximum [Member]
Components of Environmental Loss Accrual [Abstract]
Estimated remediation expense	7,000
Scientific Chemical Processing (SCP) Superfund Site [Member]
Components of Environmental Loss Accrual [Abstract]
Reserve for estimated environmental and remediation costs	1,039
Approximate number of other sites named PRP of SCP Superfund Site	130
Amount expected to be covered by insurance	737
Cosan Clifton, New Jersey Site [Member]
Components of Environmental Loss Accrual [Abstract]
Reserve for estimated environmental and remediation costs	1,191
Cosan Carlstadt New Jersey Site [Member]
Components of Environmental Loss Accrual [Abstract]
Reserve for estimated environmental and remediation costs	$ 1,063

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Gain on Sale of Asset (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended			3 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2014	Mar. 31, 2013
Property, Plant and Equipment [Line Items]
Gain on the sale of an office building and land	$ 1,234	$ 4,680	$ 0
Land [Member]
Property, Plant and Equipment [Line Items]
Gain on the sale of an office building and land	1,234			1,234
Building [Member]
Property, Plant and Equipment [Line Items]
Gain on the sale of an office building and land		$ 4,680			$ 4,680

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Commitments (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Future minimum commitments under non-cancelable operating lease arrangements [Abstract]
2015	$ 1,194
2016	600
2017	588
2018	528
2019	193
2020 and thereafter	90
Total commitments	3,193
Operating lease expense	1,113	1,090	815
Future commitments under unconditional purchase obligations [Abstract]
Future commitments under purchase obligations, 2015	$ 7,588

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Net Inventories (Tables)

12 Months Ended

Dec. 31, 2014

Net Inventories [Abstract]

Net Inventories

Net inventories consist of the following:

	December 31,
	2014		2013
Finished goods	$	24,200	$	29,797
Work in process		27,640		31,990
Raw materials		28,558		22,580
Supplies		5,232		5,598
Total	$	85,630	$	89,965

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Goodwill and Intangible Assets (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended			1 Months Ended	3 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012	May 31, 2014	Jun. 30, 2014
Goodwill [Roll Forward]
Beginning Balance	$ 38,670	$ 37,312
Acquisition of business	9,715
Translation effect	(4,473)	1,358
Ending Balance	43,912	38,670	37,312
Acquired Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	10,276	5,006
Accumulated Amortization	(1,374)	(995)
Net Carrying Amount	8,902	4,011
Amortization expense	530	255	247
Finite-Lived Intangible Assets, Net, Amortization Expense, Rolling Maturity [Abstract]
Amortization expense for current intangible assets, for year one	757
Amortization expense for current intangible assets, for year two	884
Amortization expense for current intangible assets, for year three	884
Amortization expense for current intangible assets, for year four	884
Amortization expense for current intangible assets, for year five	884
Zenara Pharma [Member]
Goodwill [Roll Forward]
Acquisition of business	9,715			9,715
Acquired Finite-Lived Intangible Assets [Line Items]
Business acquisition (in hundredths)				49.00%
Finite lived intangible assets acquired				4,900	4,900
Technology-based intangibles [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Amortization Period		20 years
Gross Carrying Amount	8,228	4,192
Accumulated Amortization	(1,141)	(786)
Net Carrying Amount	7,087	3,406
Technology-based intangibles [Member] | Minimum [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Amortization Period	10 years
Technology-based intangibles [Member] | Maximum [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Amortization Period	20 years
Customer related intangibles [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	716	814
Accumulated Amortization	(233)	(209)
Net Carrying Amount	483	605
Customer related intangibles [Member] | Minimum [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Amortization Period	10 years	10 years
Customer related intangibles [Member] | Maximum [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Amortization Period	15 years	15 years
Internal-use software [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Amortization Period	7 years
Gross Carrying Amount	1,332
Accumulated Amortization	0
Net Carrying Amount	$ 1,332

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Stockholders' Equity

12 Months Ended

Dec. 31, 2014

Stockholders' Equity [Abstract]

Stockholders' Equity

(14) Stockholders' Equity

The Company has two classes of common shares, Common Stock and Nonvoting Common Stock.  Authorized shares of Common Stock were 100,000,000 at December 31, 2014 and 2013.  Authorized shares of Nonvoting Common Stock were 730,746 at December 31, 2014 and 2013. Nonvoting Common Stock with a par value of $0.10 has equal rights with Common Stock, with the exception of voting power.  Nonvoting Common Stock is convertible, share for share, into Common Stock, subject to any legal requirements applicable to holders restricting the extent to which they may own voting stock.  As of December 31, 2014 and 2013, no shares of Nonvoting Common Stock were outstanding.  The Company has authorized 5,000,000 shares of Series Preferred Stock, par value $0.10, issuable in series and with rights, powers and preferences as may be fixed by the Board of Directors.  At December 31, 2014 and 2013, there was no preferred stock outstanding.

The Company held treasury shares of 1,738,624 and 1,757,530 at December 31, 2014 and 2013, respectively, which are primarily used for issuance to employee compensation plans.

At December 31, 2014 there were 640,331 authorized shares of Common Stock reserved for issuance through equity compensation plans.

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Commitments

12 Months Ended

Dec. 31, 2014

Commitments [Abstract]

Commitments

(19) Commitments

The Company has operating leases expiring on various dates through the year 2020.  The leases are primarily for the rental of office space, office and laboratory equipment and vehicles.  At December 31, 2014, future minimum commitments under non-cancelable operating lease arrangements were as follows:

Year ended December 31:
2015	$	1,194
2016		600
2017		588
2018		528
2019		193
2020 and thereafter		90
Total commitments	$	3,193

Total operating lease expense was $1,113, $1,090 and $815 for the years ended December 31, 2014, 2013 and 2012, respectively.

The Company is party to several unconditional purchase obligations resulting from contracts that contain legally binding provisions with respect to quantities, pricing and timing of purchases.  The Company’s purchase obligations mainly include commitments to purchase utilities.  At December 31, 2014, future commitments under these obligations were $7,588 in 2015 and none thereafter.

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Net Inventories (Details) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2014	Dec. 31, 2013
Inventory, Net [Abstract]
Finished goods	$ 24,200	$ 29,797
Work in process	27,640	31,990
Raw materials	28,558	22,580
Supplies	5,232	5,598
Total	85,630	89,965
Inventory reserves	$ 12,878	$ 11,496

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Stock Based Compensation (Tables)

12 Months Ended

Dec. 31, 2014

Stock Based Compensation [Abstract]

Assumptions used in determining the fair value of stock options for grants

The following assumptions were used in determining the fair value of stock options for grants issued in 2014, 2013 and 2012:

	2014	2013	2012
Expected volatility	35.14%-46.32%	44.17%-71.58%	71.84%
Expected term	1.75-4.75 years	1.25-4.75 years	4.75 years
Risk-free interest rate	0.43%-1.50%	0.12%-1.37%	0.66%

Summary of stock option activity

The following table is a summary of the Company’s stock option activity issued to employees and related information:

				Weighted Average
	Number of Shares			Exercise Price		Options Exercisable
Outstanding at December 31, 2013		2,229,969		$	9.39		1,149,069
Granted		479,788			18.12
Exercised		(596,135	)		7.05
Forfeited or expired		(42,950	)		10.12
Outstanding at December 31, 2014		2,070,672			12.08
Exercisable at December 31, 2014		971,797		$	8.71

Summary of nonvested stock options and restricted stock

A summary of the Company’s nonvested stock options and restricted stock activity is presented below:

	Nonvested Stock Options					Nonvested Restricted Stock
	Number of Shares			Weighted- Average Grant- Date Fair Value		Number of Shares			Weighted- Average Grant- Date Fair Value
Nonvested at December 31, 2013		1,080,900		$	6.50		-		$	-
Granted		479,788			7.15		18,906			20.90
Vested during period		(431,413	)		5.60		(18,906	)		20.90
Forfeited		(30,400	)		6.44		-			-
Nonvested at December 31, 2014		1,098,875		$	7.14		-		$	-

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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME [Abstract]
Net income	$ 57,303	$ 25,915	$ 62,303
Foreign currency translation adjustments:
Unrealized net change arising during the period	(21,400)	4,813	4,066
Foreign currency forward contracts [Abstract]
Unrealized net losses	0	0	(51)
Reclassification adjustments for gains included in net income	0	0	(329)
Income taxes	0	0	110
Interest rate swap agreement [Abstract]
Unrealized net losses	(152)	(130)	(1,253)
Reclassification adjustments for losses included in net income	465	444	323
Income taxes	(109)	(110)	326
Actuarial gain/(loss) [Abstract]
Actuarial (loss)/gain arising during the period	(18,338)	13,651	(4,413)
Amortization to net income of net actuarial loss	802	1,339	1,140
Prior service cost [Abstract]
Amortization to net income of net prior service cost	50	50	110
Settlement loss	7,170	0	0
Other Comprehensive (Income) Loss, Pension and other Postretirement Benefit Plans, Tax [Abstract]
Income taxes	5,493	(4,928)	(2,533)
Comprehensive income	$ 31,284	$ 41,044	$ 59,799

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Impact of Recently Issued Accounting Pronouncements

12 Months Ended

Dec. 31, 2014

Impact of Recently Issued Accounting Pronouncements [Abstract]

Impact of Recently Issued Accounting Pronouncements

(3) Impact of Recently Issued Accounting Pronouncements

Revenue from Contracts with Customers

In May 2014, the FASB issued ASU 2014-09 that introduces a new five-step revenue recognition model in which an entity should recognize revenue to depict the transfer of promised 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. This ASU also requires disclosures sufficient to enable users to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers, including qualitative and quantitative disclosures about contracts with customers, significant judgments and changes in judgments, and assets recognized from the costs to obtain or fulfill a contract. This standard is effective for fiscal years beginning after December 15, 2016, including interim periods within that reporting period. The Company is currently evaluating the new guidance to determine the impact, if any, it will have on its consolidated financial statements.

Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity

In April 2014, the FASB issued ASU 2014-08, which includes amendments that change the requirements for reporting discontinued operations and require additional disclosures about discontinued operations. Under the new guidance, only disposals representing a strategic shift in operations - that is, a major effect on the organization's operations and financial results should be presented as discontinued operations. Additionally, the ASU requires expanded disclosures about discontinued operations that will provide financial statement users with more information about the assets, liabilities, income and expenses of discontinued operations. This update is effective in the first quarter of 2015. This pronouncement will not have an impact on the Company’s financial position or results of operations.

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Stockholders' Equity (Details) (USD $)	Dec. 31, 2014	Dec. 31, 2013
Class of Stock [Line Items]
Common stock, shares authorized (in shares)	100,000,000	100,000,000
Common stock, par value (in dollars per share)	$ 0.10	$ 0.10
Preferred stock, shares authorized (in shares)	5,000,000	5,000,000
Preferred stock, par value (in dollars per share)	$ 0.10	$ 0.10
Preferred stock, shares outstanding (in shares)	0	0
Treasury stock (in shares)	1,738,624	1,757,530
Common stock reserved for issuance (in shares)	640,331
Nonvoting Common Stock [Member]
Class of Stock [Line Items]
Common stock, shares authorized (in shares)	730,746	730,746
Common stock, par value (in dollars per share)	$ 0.10	$ 0.10
Common stock, shares outstanding (in shares)	0	0
Common Stock [Member]
Class of Stock [Line Items]
Common stock, shares authorized (in shares)	100,000,000	100,000,000

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Contingencies

12 Months Ended

Dec. 31, 2014

Contingencies [Abstract]

Contingencies

(20) Contingencies

The Company is subject to various investigations, claims and legal proceedings covering a wide range of matters that arise in the ordinary course of its business activities.  The Company continually assesses known facts and circumstances as they pertain to applicable legal and environmental matters and evaluates the need for reserves and disclosures as deemed necessary based on these facts and circumstances.  These matters, either individually or in the aggregate, could result in actual costs that are significantly higher than the Company’s current assessment and could have a material adverse effect on the Company's operating results and cash flows in future reporting periods. While these matters could have a material adverse effect on the Company’s financial condition, based upon past experience, the Company believes that payments significantly in excess of current reserves, if required, would be made over an extended number of years.

Environmental

In connection with laws and regulations pertaining to the protection of the environment, the Company and its subsidiaries are a party to several environmental proceedings and remediation activities and along with other companies, have been named a potentially responsible party (“PRP”) for certain waste disposal sites ("Superfund sites").  Substantially all of the liabilities currently recorded on the Company’s balance sheet for environmental proceedings are associated with discontinued operations. The Company had insurance policies in place at certain of the discontinued operations for certain years that the Company believes should cover some portion of currently recorded liabilities or potential future liabilities.

It is the Company’s policy to record appropriate liabilities for environmental matters where remedial efforts are probable and the costs can be reasonably estimated.  Such liabilities are based on the Company’s estimate of the undiscounted future costs required to complete the remedial work.  Each of these matters is subject to various uncertainties, and it is possible that some of these matters will be decided against the Company. The resolution of such matters often spans several years and frequently involves regulatory oversight or adjudication.  Additionally, many remediation requirements are fluid and are likely to be affected by future technological, site and regulatory developments.  It is not possible at this time for the Company to determine fully the effect of all asserted and unasserted claims on its consolidated financial condition, results of operations or liquidity; however, to the extent possible, where asserted and unasserted claims can be estimated and where such claims are considered probable, the Company would record a liability. Consequently, the ultimate liability with respect to such matters, as well as the timing of cash disbursements, is uncertain.

In matters where the Company is able to reasonably estimate the probable and estimable costs associated with environmental proceedings, the Company accrues for the estimated costs associated with the study and remediation of applicable sites. These reserves were $9,595 and $10,881 at December 31, 2014 and 2013, respectively. The decrease in the reserve includes payments of $2,269 and the impact of currency translation of $226 partially offset by adjustments to reserves of $1,209. The reserves are adjusted periodically as remediation efforts progress or as additional technical, regulatory or legal information becomes available.  Given the uncertainties regarding the outcome of investigative and study activities, the status of laws, regulations, enforcement, policies, the impact of other PRPs, technology and information related to individual sites, the Company does not believe it is possible to currently develop an estimate of the range of reasonably possible environmental loss in excess of its reserves.

CasChem

As a result of the sale of a Bayonne, New Jersey facility, the Company became obligated to investigate site conditions and conduct required remediation under the New Jersey Industrial Site Recovery Act.  The Company intends to continue implementing a sampling plan at the property pursuant to the New Jersey Department of Environmental Protection’s (“NJDEP”) private oversight program.  The results of the completed sampling, and any additional sampling deemed necessary, will be used to develop an estimate of the Company's future liability for remediation costs.  As of December 31, 2014, the Company’s reserve for the investigation of site conditions was $193.

Cosan

The Company has implemented a sampling and pilot program in Clifton, New Jersey pursuant to the NJDEP private oversight program.  The results of the sampling and pilot program to date have been used to develop an estimate of the Company's future liability for remediation costs.  As of December 31, 2014, the Company’s reserve was $1,191.

Additionally, the Company has implemented a sampling and pilot program in Carlstadt, New Jersey pursuant to the NJDEP private oversight program.  The results of the sampling and pilot program to date have been used to develop an estimate of the Company's future liability for remediation costs. As of December 31, 2014, the Company’s reserve was $1,063.

Berry’s Creek

The Company received a notice from the United States Environmental Protection Agency (“USEPA”) that two subsidiaries of the Company are considered PRPs at the Berry’s Creek Study Area in New Jersey.  These subsidiaries are among many other PRPs that were listed in the notice.  Pursuant to the notice, the PRPs have been asked to perform a remedial investigation and feasibility study of the Berry’s Creek site. The Company has joined the group of PRPs and entered into an Administrative Settlement Agreement (“Agreement”) and Order on Consent with the USEPA agreeing to jointly conduct or fund an appropriate remedial investigation and feasibility study of the Berry’s Creek site with the other PRPs in the Agreement. The PRPs have engaged consultants to perform the work specified in the Agreement and develop a method to allocate related costs among the PRPs.  As of December 31, 2014, the Company’s reserve was $388 to cover the current phase of investigation based on a tentative agreement on the allocation of the site investigation costs among the PRPs.   Due to the very preliminary and uncertain nature of any estimates related to the method and costs of any remediation solution, the number of eventual PRPs, and their respective proportion of remediation costs, the Company’s liability cannot be reasonably estimated at this time; as such, no accrual is recorded for these potential future costs. The impact of the resolution of this matter on the Company’s results of operations in any future reporting period is not known.

In July 2014, the Company received a notice from the U.S. Department of the Interior, U.S. Fish & Wildlife Service, regarding the Company’s potential liability for natural resource damages at the Berry’s Creek site and inviting the Company to participate in a cooperative assessment of natural resource damages.  All members of the Berry’s Creek PRP group are receiving such notice letters, and any response from the Company will be coordinated with the PRP Group.  The substance of any response from the Company, the cost of any assessment, and the ultimate scope of natural resource damage liability are not yet known.

Maybrook Site

A subsidiary of Cambrex is named a PRP of a site in Hamptonburgh, New York by the USEPA in connection with the discharge, under appropriate permits, of wastewater at that site prior to Cambrex's acquisition in 1986.  The PRPs implemented soil remediation which was completed in 2012 pending approval by the USEPA.  The PRPs will continue implementing the ground water remediation at the site. As of December 31, 2014, the Company’s reserve was $322 to cover remaining ground water remediation and long-term monitoring.

Harriman Site

Subsidiaries of Cambrex and Pfizer are named as responsible parties for the Company’s former Harriman, New York production facility by the New York State Department of Environmental Conservation (“NYSDEC”).  A final ROD (“Record of Decision”) describing the Harriman site remediation responsibilities for Pfizer and the Company was issued in 1997 (the "1997 ROD") and incorporated into a federal court Consent Decree in 1998 (the “Consent Decree”).  Site clean-up work under the 1997 ROD is ongoing and is being jointly performed by Pfizer and the Company, with NYSDEC oversight.  ELT Harriman, LLC ("ELT"), the current owner of the Harriman site, is conducting other investigation and remediation activities under a separate NYSDEC directive.

In October 2013, the NYSDEC sent the Company, Pfizer, ELT and the immediately preceding owner Vertellus Specialties Holdings (“Vertellus”) an enforcement letter demanding that the Company and Pfizer submit a work plan for the further study and remediation of certain areas of the Harriman site, including the evaluation of certain remedies that the Company has contended are not required by the 1997 ROD.  In December 2013, the Company, Pfizer and the NYSDEC entered into a federal court stipulation, which the court subsequently endorsed as a court order, withdrawing the October 2013 enforcement letter as it relates to the Company and Pfizer, and resolving certain disputes about the scope of their obligations under the Consent Decree and the 1997 ROD.  Pursuant to the court order, the Company and Pfizer are required to carry out an environmental investigation and study of certain areas of the Harriman Site.

No final remedy for the site has been determined, which will follow further discussions with the NYSDEC.  The Company estimated the range for its share of the liability at the site to be between $2,000 and $7,000.  As of December 31, 2014, the Company’s reserve was $3,615.  At this time, the Company is unable to provide an estimate of the ultimate investigative and remedial costs to the Company for any final remedy selected by the NYSDEC.

The Company intends to enforce all of its contractual rights to recover costs and for indemnification under a 2007 settlement agreement, and has filed such claims in an arbitration proceeding against ELT and Vertellus. ELT has filed counterclaims, and has threatened to file additional counterclaims, for contractual indemnification and for breach of the settlement agreement against the Company.  Currently, the arbitration proceeding is stayed indefinitely.

Scientific Chemical Processing (“SCP”) Superfund Site

A subsidiary of Cambrex was named a PRP of the SCP Superfund site, located in Carlstadt, New Jersey, along with approximately 130 other PRPs.  The site is a former waste processing facility that accepted various waste for recovery and disposal including processing wastewater from this subsidiary.  The PRPs are in the process of implementing a final remedy at the site.  The SCP Superfund site has also been identified as a PRP in the Berry’s Creek Superfund site (see previous discussion). For over a decade, the remediation has been funded by de minimus settlements and by the insurers of the SCP Superfund site’s owners and operators.  However, due to an unexpected increase in remediation costs at the site and costs related to SCP’s involvement in the Berry’s Creek investigation, the PRP group approved the assessment of an additional cash contribution by the PRP group.  While the Company continues to dispute the methodology used by the PRP group to arrive at its allocation for the cash contribution, the Company has paid the recent funding requests in 2010 and 2014.  The next funding request is expected in 2015. A final allocation of SCP Site costs is expected to be developed concurrent with the final allocation process for Berry’s Creek Study Area starting in 2015.  As of December 31, 2014, the Company’s reserve was $1,039, of which approximately $737 is expected to be covered by insurance.

Newark Bay Complex

Two subsidiaries of the Company were named along with several hundred third-party defendants in a third-party complaint filed in February 2009, by Maxus Energy Corporation (“Maxus”) and Tierra Solutions, Inc. (“Tierra”) relating to a N.J. state action concerning the  Passaic River, Newark Bay, Hackensack River, Arthur Kill, Kill Van Kull and adjacent waters (the “Newark Bay Complex”).  The Company settled this case which resolved certain New Jersey state based claims related to the Newark Bay Complex. The settlement will require Maxus and Tierra to re-file  any further claims against the Company in federal court.   In preparation for any such federal or similar claims, the Company is currently monitoring developments regarding the Newark Bay Complex.  Due to the uncertainty of the future scope and timing of any such claims, the Company’s liability cannot be reasonably estimated at this time, and as such, no accrual is recorded for these potential future costs.

The Company is involved in other related and unrelated environmental matters where the range of liability is not reasonably estimable at this time and it is not foreseeable when information will become available to provide a basis for adjusting or recording a reserve, should a reserve ultimately be required.

Litigation and Other Matters

Lorazepam and Clorazepate

In 1998, the Company and a subsidiary were named as defendants along with Mylan Laboratories, Inc. (“Mylan”) and Gyma Laboratories, Inc. (“Gyma”) in a proceeding instituted by the Federal Trade Commission in the United States District Court for the District of Columbia (the “District Court”). Suits were also commenced by several State Attorneys General and class action complaints by private plaintiffs in various state courts. The suits alleged violations of the Federal Trade Commission Act arising from exclusive license agreements between the Company and Mylan covering two APIs (Lorazepam and Clorazepate).

All cases have been resolved except for one brought by four health care insurers. In the remaining case, the District Court entered judgment after trial in 2008 against Mylan, Gyma and Cambrex in the total amount of $19,200, payable jointly and severally, and also a punitive damage award against each defendant in the amount of $16,709.  In addition, at the time, the District Court ruled that the defendants were subject to a total of approximately $7,500 in prejudgment interest. The case is currently pending before the District Court following a January 2011 remand by the Court of Appeals.  In July 2014, the District Court dismissed certain customers for which the plaintiffs were unable to establish jurisdiction and consequently, the plaintiffs currently have a motion pending before the District Court to reduce the damages award by a total of $9,600.

In 2003, Cambrex paid $12,415 to Mylan in exchange for a release and full indemnity against future costs or liabilities in related litigation brought by the purchasers of Lorazepam and Clorazepate, as well as potential future claims related to the ongoing matter.  Mylan has submitted a surety bond underwritten by a third-party insurance company in the amount of $66,632.  In the event of a final settlement or final judgment, Cambrex expects any payment required by the Company to be made by Mylan under the indemnity described above.

Other

The Company has commitments incident to the ordinary course of business including corporate guarantees of certain subsidiary obligations to the Company’s lenders related to financial assurance obligations under certain environmental laws for remediation; closure and third party liability requirements of certain of its subsidiaries and a former operating location; contract provisions for indemnification protecting its customers and suppliers against third party liability for the manufacture and sale of Company products that fail to meet product warranties and contract provisions for indemnification protecting licensees against intellectual property infringement related to licensed Company technology or processes.

Additionally, as permitted under Delaware law, the Company indemnifies its officers, directors and employees for certain events or occurrences while the officer, director or employee is, or was, serving at the Company’s request in such capacity. The term of the indemnification period is for the officer's, director's or employee’s lifetime. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited; however, the Company has a director and officer insurance policy that covers a portion of any potential exposure.  The Company currently believes the estimated fair value of its indemnification agreements is not material based on currently available information, and as such, the Company had no liabilities recorded for these agreements as of December 31, 2014.

Cambrex's subsidiaries are party to a number of other proceedings that are not considered material at this time.

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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2014

Income Taxes [Abstract]

Income/(loss) before income taxes

Income before income taxes consists of the following:

	December 31,
	2014		2013		2012
Domestic	$	37,211	$	23,068	$	13,525
International		8,295		21,939		17,843
Total	$	45,506	$	45,007	$	31,368

Provision for income taxes

The provision for income taxes consist of the following provisions/(benefits):

	December 31,
	2014			2013		2012
Current:
Federal	$	2,572		$	630	$	(177	)
State		-			15		4
International		512			5,980		8,525
		3,084			6,625		8,352
Deferred:
Federal	$	(14,965	)	$	7,014	$	(36,287	)
International		(746	)		1,093		(3,926	)
		(15,711	)		8,107		(40,213	)
Total	$	(12,627	)	$	14,732	$	(31,861	)

Provision for income taxes differs from the statutory federal income tax rate

The (benefit)/provision for income taxes differs from the statutory federal income tax rate of 35% for 2014, 2013 and 2012 as follows:

	December 31,
	2014			2013			2012
Income tax provision at U.S federal statutory rate	$	15,927		$	15,752		$	10,979
Effect of foreign income taxed at rates other than the U.S. federal statutory rate		751			242			(451	)
Foreign income inclusions		2,742			-			4,563
Tax credits		(2,692	)		(250	)		(177	)
Changes in tax laws		-			(1,155	)		(1,329	)
Tax audit settlements		(3,948	)		-			-
Net change in valuation allowance		(26,543	)		(97	)		(45,105	)
Permanent items and other		1,136			240			(341	)
Total	$	(12,627	)	$	14,732		$	(31,861	)

Components of deferred tax assets and liabilities

The components of deferred tax assets and liabilities as of December 31, 2014 and 2013 relate to temporary differences and carryforwards as follows:

	December 31,
	2014			2013
Deferred tax assets:
Inventory	$	3,313		$	2,510
Foreign tax credit carryforwards		19,925			31,463
Environmental		2,993			2,995
Net operating loss carryforwards (foreign)		3,381			944
Employee benefits		18,879			12,841
Research & experimentation tax credit carryforwards		480			1,900
Alternative minimum tax credit carryforwards		2,773			2,773
Property, plant and equipment		3,898			3,843
Other		5,605			4,037
Total gross deferred tax assets		61,247			63,306
Valuation allowance		(5,053	)		(29,890	)
Total deferred tax assets	$	56,194		$	33,416
Deferred tax liabilities:
Property, plant and equipment		(9,649	)		(9,059	)
Intangibles and other		(10,487	)		(9,856	)
Unremitted foreign earnings		(726	)		(568	)
Foreign tax allocation reserve		(1,856	)		(2,006	)
Other		(1,978	)		(2,187	)
Total deferred tax liabilities	$	(24,696	)	$	(23,676	)
Net deferred tax asset	$	31,498		$	9,740
Classified as follows in the consolidated balance sheet:
Current deferred tax asset (included in other current assets)		3,808			2,874
Non-current deferred tax asset		38,424			19,799
Current deferred tax liability (included in other current liabilities)		(189	)		(98	)
Non-current deferred tax liability		(10,545	)		(12,835	)
	$	31,498		$	9,740

Activity related to the entity's unrecognized tax benefits

The following table summarizes the activity related to the Company’s unrecognized tax benefits as of December 31, 2014, 2013 and 2012:

	2014			2013			2012
Balance at January 1	$	3,922		$	3,967		$	4,328
Gross increases related to current period tax positions		275			257			348
Gross decreases related to prior period tax positions		(1,149	)		(427	)		(483	)
Expirations of statute of limitations for the assessment of taxes		(106	)		(37	)		(113	)
Settlements		(1,113	)		-			(175	)
Foreign currency translation		(186	)		162			62
Balance at December 31	$	1,643		$	3,922		$	3,967

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Fair Value Measurements

12 Months Ended

Dec. 31, 2014

Fair Value Measurements [Abstract]

Fair Value Measurements

(13) Fair Value Measurements

U.S. GAAP establishes a valuation hierarchy for disclosure of the inputs to the valuations used to measure fair value. This hierarchy prioritizes the inputs into three broad levels as follows: Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities; Level 2 inputs are quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets in markets that are not active, inputs other than quoted prices that are observable for the asset or liability, including interest rates, yield curves and credit risks, or inputs that are derived principally from, or corroborated by, observable market data through correlation; Level 3 inputs are unobservable inputs based on the Company’s assumptions used to measure assets and liabilities at fair value. A financial asset or liability’s classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement.

The following tables provide the assets and liabilities carried at fair value, measured on a recurring basis, as of December 31, 2014 and 2013:

				Fair Value Measurements at December 31, 2014 using:
Description	Total			Level 1		Level 2			Level 3
Foreign currency forwards, liabilities	$	(102	)	$	-	$	(102	)	$	-
Interest rate swap, liabilities		(304	)		-		(304	)		-
Total	$	(406	)	$	-	$	(406	)	$	-
				Fair Value Measurements at December 31, 2013 using:
Description	Total			(Level 1)		(Level 2)			(Level 3)
Interest rate swap, liabilities	$	(616	)	$	-	$	(616	)	$	-
Total	$	(616	)	$	-	$	(616	)	$	-

The fair value of the interest rate swap is estimated based on the present value of the difference between expected cash flows calculated at the contracted interest rate and the expected cash flows at current market interest rates using observable benchmarks for the LIBOR forward rates at the end of the period. The Company’s credit risk and its counterparties’ credit risks are also evaluated to estimate fair value.

The Company’s foreign currency forward contracts are measured at fair value using observable market inputs such as forward rates, the Company’s credit risk and its counterparties’ credit risks. Based on the Company’s continued ability to enter into forward contracts, the Company considers the markets for its fair value instruments to be active.

Based on these inputs, the Company’s interest rate swap and foreign currency forward contracts are classified within Level 2 of the valuation hierarchy.

The Company’s financial instruments also include cash and cash equivalents, accounts receivables and accounts payables.  The carrying amount of these instruments approximates fair value because of their short-term nature.  The carrying amount of the Company’s long-term debt approximates fair value because the debt is based on current rates at which the Company could borrow funds with similar maturities.

Refer to Note 12 to the Company’s consolidated financial statements for further disclosures on the Company’s financial instruments.