Shareholders' equity

12 Months Ended

Dec. 31, 2015

Equity [Abstract]

Shareholders' equity

Shareholders' equity

The authorized capital of the Company is comprised of 200 million common shares, $1 par value, and 500,000 preference shares. No preference shares have been outstanding during the last three years.

Basic earnings per share is computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed in the same manner except that the weighted average number of shares is increased to include dilutive securities. The following table provides a reconciliation of basic to diluted weighted average shares outstanding:

	2015	2014	2013
	(Shares in thousands)
Basic	41,558	41,366	41,105
Dilutive effect of share based awards	488	450	410
Dilutive effect of 3.875% Convertible Notes and warrants	6,012	4,654	2,178
Diluted	48,058	46,470	43,693

Weighted average shares that were antidilutive and therefore not included in the calculation of earnings per share were approximately 5.6 million, 6.3 million and 7.7 million for the years ended December 31, 2015, 2014 and 2013, respectively.

During periods in which the average market price of the Company's common stock is above the applicable conversion price of the Convertible Notes, or $61.32 per share, the impact of conversion would be dilutive and the dilutive effect of conversion of the Convertibles Notes is reflected in diluted earnings per share. As described in Note 8, the Company has elected the net settlement method of accounting for these conversions, under which the Company will settle the principal amount of the Convertible Notes in cash, and settle the excess conversion value in shares. As a result, in periods where the average market price of the Company's common stock is above $61.32 per share, under the treasury stock method, the Company calculates the number of shares issuable under the terms of the Convertible Notes based on the average market price of the stock during the period, and includes that number in the total diluted shares outstanding for the period. 

In connection with the issuance of the Convertible Notes, the Company entered into convertible note hedge and warrant agreements. The convertible note hedge agreements economically reduce the dilutive impact of the Convertible Notes. However, applicable accounting guidance requires the Company to separately analyze the impact of the warrant agreements on diluted weighted average shares outstanding, without giving effect to the anti-dilutive impact of the convertible note hedge agreements. The reductions in diluted shares that would result from giving effect to the anti-dilutive impact of the convertible note hedge agreements would have been 3.3 million, 2.7 million, and 1.6 million for the years ended December 31, 2015, 2014 and 2013, respectively. The treasury stock method is applied when the warrants are in the money and assumes the proceeds from the exercise of the warrants are used to repurchase shares based on the average stock price during the period. The exercise price of the warrants is approximately $74.65 per share of common stock. Shares issuable upon exercise of the warrants that were included in the total diluted shares outstanding were 2.7 million, 1.9 million and 0.6 million for the years ended December 31, 2015, 2014 and 2013, respectively. For additional information regarding the convertible notes and convertible note hedge and warrant agreements, see Note 8 to the consolidated financial statements.

The following tables provide information relating to the changes in accumulated other comprehensive income (loss), net of tax, for the years ended December 31, 2015 and 2014:

	Cash Flow Hedges			Pension and Other Postretirement Benefit Plans			Foreign Currency Translation Adjustment			Accumulated Other Comprehensive Income (Loss)
	(Dollars in thousands)
Balance at December 31, 2013	$	—		$	(97,037	)	$	(13,818	)	$	(110,855	)
Other comprehensive income (loss) before reclassifications	594			(47,536		)	(105,333		)	(152,275		)
Amounts reclassified from accumulated other comprehensive income (loss)	(594		)	2,829			—			2,235
Net current-year other comprehensive income (loss)	—			(44,707		)	(105,333		)	(150,040		)
Balance at December 31, 2014	—			(141,744		)	(119,151		)	(260,895		)
Other comprehensive income (loss) before reclassifications	(2,974		)	(1,276		)	(110,595		)	(114,845		)
Amounts reclassified from accumulated other comprehensive income	483			4,133			—			4,616
Net current-year other comprehensive (loss) income	(2,491		)	2,857			(110,595		)	(110,229		)
Balance at December 31, 2015	$	(2,491	)	$	(138,887	)	$	(229,746	)	$	(371,124	)

The following table provides information relating to the reclassifications of losses/(gains) in accumulated other comprehensive (loss) income into expense/(income), net of tax, for the years ended December 31, 2015, 2014 and 2013 :

	December 31, 2015			December 31, 2014			December 31, 2013
	(Dollars in thousands)
Losses (gains) on foreign exchange contracts:
Cost of goods sold	$	679		$	(705	)	$	884
Total before tax	679			(705		)	884
Taxes	(196		)	111			46
Net of tax	$	483		$	(594	)	$	930
Amortization of pension and other postretirement benefits items:
Actuarial losses (1)	$	6,375		$	4,385		$	7,211
Prior-service credits (1)	—			(21		)	(21		)
Transition obligation	—			—			5
Total before tax	6,375			4,364			7,195
Tax benefit	(2,242		)	(1,535		)	(2,439		)
Net of tax	$	4,133		$	2,829		$	4,756
Total reclassifications, net of tax	$	4,616		$	2,235		$	5,686

(1) These accumulated other comprehensive (loss) income components are included in the computation of net benefit cost of pension and other postretirement benefit plans (see Note 14 to the consolidated financial statements for additional information).

As previously disclosed, in 2007, the Company’s Board of Directors authorized the repurchase of up to $300 million of outstanding Company common stock. On February 23, 2016, the Company's Board of Directors terminated this authorization. No shares were purchased under this authorization.