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 (§232.405 of this chapter) during the preceding 12 months (or for such shorter time period that the registrant was required to submit ~~and post~~ such files). Yes ☒ No ☐

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

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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

Number of shares of Armstrong World Industries, Inc.’s common stock outstanding as of ~~October~~April 24, ~~2017~~2019 – ~~52,795,753.~~48,959,255.

When we refer to “AWI,” the “Company,” “we,” “our” or “us,” we are referring to Armstrong World Industries, Inc. and its subsidiaries.

Certain statements in this Quarterly Report on Form 10-Q and the documents incorporated by reference herein may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Those forward-looking statements are subject to various risks and uncertainties and include all statements that are not historical statements of fact and those regarding our intent, belief or expectations, including, but not limited to, our expectations concerning our residential and commercial markets and their effect on our operating results; our expectations regarding the payment of dividends; and our ability to increase revenues, earnings and EBITDA (as such terms are defined by documents incorporated by reference herein). Words such as “anticipate,” “expect,” “intend,” “plan,” “target,” “project,” “predict,” “believe,” “may,” “will,” “would,” “could,” “should,” “seek,” “estimate” and similar expressions are intended to identify such forward-looking statements. These statements are based on management’s current expectations and beliefs and are subject to a number of factors that could lead to actual results materially different from those described in the forward-looking statements. Although we believe that the assumptions underlying the forward-looking statements are reasonable, we can give no assurance that our expectations will be attained. Factors that could have a material adverse effect on our financial condition, liquidity, results of operations or future prospects or which could cause actual results to differ materially from our expectations include, but are not limited to:

Such forward-looking statements speak only as of the date they are made. We expressly disclaim any obligation to release publicly any updates or revisions to any forward-looking statements to reflect any change in our expectations with regard thereto or change in events, conditions or circumstances on which any forward-looking statement is based.

	Three Months Ended September 30, 2017			Three Months Ended September 30, 2016			Nine Months Ended September 30, 2017			Nine Months Ended September 30, 2016			Three Months Ended March 31, 2019			Three Months Ended March 31, 2018
Net sales	$	351.9		$	334.9		$	998.1		$	936.6		$	242.1		$	227.3
Cost of goods sold		241.0			225.2			676.8			651.1			150.7			156.5
Gross profit		110.9			109.7			321.3			285.5			91.4			70.8
Selling, general and administrative expenses		55.8			55.7			162.8			165.2			55.6			37.5
Separation costs		-			2.0			-			33.0
Equity earnings from joint venture		(13.9	)		(19.0	)		(51.9	)		(57.0	)		(18.9	)		(16.3	)
Operating income		69.0			71.0			210.4			144.3			54.7			49.6
Interest expense		9.1			9.0			27.5			43.4			10.4			9.2
Other non-operating expense		1.7			-			3.6			-
Other non-operating (income)		(3.0	)		(1.6	)		(7.4	)		(8.9	)
Other non-operating (income), net														(5.5	)		(9.0	)
Earnings from continuing operations before income taxes		61.2			63.6			186.7			109.8			49.8			49.4
Income tax expense		17.7			7.7			70.9			44.4			13.4			8.2
Earnings from continuing operations		43.5			55.9			115.8			65.4			36.4			41.2
Net (loss) from discontinued operations, net of tax expense of $ -, $-, $- and $ 0.1		-			-			-			(4.5	)
Gain from disposal of discontinued business, net of tax (benefit) of ($5.9), ($14.7), ($5.4) and ($16.6)		5.9			14.7			5.3			16.7
Net gain from discontinued operations		5.9			14.7			5.3			12.2
Net earnings from discontinued operations, net of tax (benefit) expense of ($0.1) and $1.5														0.5			3.9
Gain (loss) from disposal of discontinued businesses, net of tax (benefit) of $- and ($0.4)														2.2			(17.3	)
Net gain (loss) from discontinued operations														2.7			(13.4	)
Net earnings	$	49.4		$	70.6		$	121.1		$	77.6		$	39.1		$	27.8
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments		7.0			(2.0	)		20.9			(13.8	)		5.3			5.9
Derivative (loss) gain		(0.3	)		1.7			(2.0	)		1.2
Derivative (loss) gain, net														(5.1	)		3.8
Pension and postretirement adjustments		14.3			6.9			18.8			23.9			2.8			1.8
Total other comprehensive income		21.0			6.6			37.7			11.3			3.0			11.5
Total comprehensive income	$	70.4		$	77.2		$	158.8		$	88.9		$	42.1		$	39.3
Earnings per share of common stock, continuing operations:
Basic	$	0.82		$	1.00		$	2.16		$	1.17		$	0.75		$	0.78
Diluted	$	0.81		$	0.99		$	2.14		$	1.16		$	0.73		$	0.76
Earnings per share of common stock, discontinued operations:
Earnings (loss) per share of common stock, discontinued operations:
Basic	$	0.11		$	0.26		$	0.10		$	0.22		$	0.05		$	(0.25	)
Diluted	$	0.11		$	0.26		$	0.10		$	0.22		$	0.05		$	(0.25	)
Net earnings per share of common stock:
Basic	$	0.93		$	1.27		$	2.26		$	1.39		$	0.80		$	0.53
Diluted	$	0.92		$	1.26		$	2.24		$	1.38		$	0.78		$	0.51
Average number of common shares outstanding:
Basic		53.0			55.5			53.5			55.6			48.7			53.0
Diluted		53.5			56.0			53.9			56.0			49.5			53.8

See accompanying notes to Condensed Consolidated Financial Statements beginning on page 8.

	Unaudited September 30, 2017			December 31, 2016			Unaudited March 31, 2019			December 31, 2018
Assets
Current assets:
Cash and cash equivalents	$	116.5		$	141.9		$	273.8		$	325.7
Accounts and notes receivable, net		142.5			108.3			85.3			79.9
Inventories, net		117.8			109.0			72.1			61.2
Assets of discontinued operations								308.9			279.5
Income tax receivable		7.4			26.2			0.7			1.7
Other current assets		23.6			20.8			8.2			4.8
Total current assets		407.8			406.2			749.0			752.8
Property, plant, and equipment, less accumulated depreciation and amortization of $497.5 and $445.5, respectively		699.0			669.6
Property, plant, and equipment, less accumulated depreciation and amortization of $421.8 and $412.9, respectively								510.5			501.0
Lease right-of-use assets								28.8			-
Prepaid pension costs		91.2			56.6			59.5			52.8
Investment in joint venture		105.4			106.2			38.7			40.8
Goodwill and intangible assets, net		450.3			434.5			472.3			442.0
Deferred income taxes		11.6			15.4			19.0			14.8
Income taxes receivable		-			5.7			0.8			0.8
Other non-current assets		64.4			63.8			64.0			68.5
Total assets	$	1,829.7		$	1,758.0		$	1,942.6		$	1,873.5
Liabilities and Shareholders' Equity
Current liabilities:
Current installments of long-term debt	$	32.5		$	25.0		$	62.5		$	55.0
Accounts payable and accrued expenses		169.8			197.1			390.9			383.3
Liabilities of discontinued operations								129.3			110.3
Income tax payable		3.6			2.0			7.2			0.9
Total current liabilities		205.9			224.1			589.9			549.5
Long-term debt, less current installments		825.3			848.6			749.7			764.8
Lease non-current liabilities								23.6			-
Postretirement benefit liabilities		80.2			84.8			57.6			58.8
Pension benefit liabilities		90.4			86.3			49.7			50.3
Other long-term liabilities		27.6			29.1			33.0			38.0
Income taxes payable		31.8			62.2			26.9			26.5
Deferred income taxes		202.3			156.5			131.9			124.4
Total non-current liabilities		1,257.6			1,267.5			1,072.4			1,062.8
Shareholders' equity:
Common stock, $0.01 par value per share, 200 million shares authorized, 60,719,298 shares issued and 52,792,644 shares outstanding as of September 30, 2017 and 60,597,140 shares issued and 54,428,233 shares outstanding as of December 31, 2016		0.6			0.6
Additional paid-in capital		512.6			504.9
Common stock, $0.01 par value per share, 200 million shares authorized, 61,717,806 shares issued and 48,640,635 shares outstanding as of March 31, 2019 and 61,553,724, shares issued and 48,808,239 shares outstanding as of December 31, 2018								0.6			0.6
Capital in excess of par value								553.3			547.4
Retained earnings		599.7			469.9			895.1			865.0
Treasury stock, at cost, 7,926,654 shares as of September 30, 2017 and 6,168,907 shares as of December 31, 2016		(380.6	)		(305.2	)
Treasury stock, at cost, 13,077,171 shares as of March 31, 2019 and 12,745,485 shares as of December 31, 2018								(712.2	)		(692.2	)
Accumulated other comprehensive (loss)		(366.1	)		(403.8	)		(456.5	)		(459.6	)
Total shareholders' equity		366.2			266.4			280.3			261.2
Total liabilities and shareholders' equity	$	1,829.7		$	1,758.0		$	1,942.6		$	1,873.5

See accompanying notes to Condensed Consolidated Financial Statements beginning on page 8.

	Nine Months Ended September 30, 2017																					Three Months Ended March 31, 2019
																Accumulated																					Accumulated
						Additional										Other											Additional										Other
	Common Stock					Paid-In			Retained		Treasury Stock					Comprehensive						Common Stock					Paid-In		Retained			Treasury Stock					Comprehensive
	Shares			Amount		Capital			Earnings		Shares		Amount			(Loss)			Total			Shares			Amount		Capital		Earnings			Shares		Amount			(Loss)			Total
Balance at beginning of period		54,428,233		$	0.6	$	504.9		$	469.9		6,168,907	$	(305.2	)	$	(403.8	)	$	266.4			48,808,239		$	0.6	$	547.4	$	865.0			12,745,485	$	(692.2	)	$	(459.6	)	$	261.2
Cumulative effect impact of ASU 2016-09 adoption										8.7										8.7
Stock issuance		122,158
Cumulative effect impact of ASU 2017-12 adoption																														(0.1	)							0.1			-
Stock issuance, net																							164,082
Cash dividends - $0.175 per common share																														(8.9	)										(8.9	)
Share-based employee compensation							6.8													6.8								5.9													5.9
Net earnings										121.1										121.1										39.1											39.1
Separation of Armstrong Flooring, Inc.							0.9													0.9
Other comprehensive income																	37.7			37.7																		3.0			3.0
Acquisition of treasury stock		(1,757,747	)									1,757,747		(75.4	)					(75.4	)		(331,686	)									331,686		(20.0	)					(20.0	)
Balance at end of period		52,792,644		$	0.6	$	512.6		$	599.7		7,926,654	$	(380.6	)	$	(366.1	)	$	366.2			48,640,635		$	0.6	$	553.3	$	895.1			13,077,171	$	(712.2	)	$	(456.5	)	$	280.3

	Nine Months Ended September 30, 2016																					Three Months Ended March 31, 2018
																Accumulated																					Accumulated
						Additional										Other											Additional										Other
	Common Stock					Paid-In			Retained		Treasury Stock					Comprehensive						Common Stock					Paid-In		Retained			Treasury Stock					Comprehensive
	Shares			Amount		Capital			Earnings		Shares		Amount			(Loss)			Total			Shares			Amount		Capital		Earnings			Shares		Amount			(Loss)			Total
Balance at beginning of period		55,359,064		$	0.6	$	1,151.8		$	365.2		5,057,382	$	(261.4	)	$	(487.4	)	$	768.8			52,772,139		$	0.6	$	516.8	$	633.4			8,010,597	$	(385.6	)	$	(345.9	)	$	419.3
Stock issuance		147,488
Cumulative effect impact of ASU 2018-02 adoption																														54.3								(54.3	)		-
Stock issuance, net																							591,584
Share-based employee compensation							13.1													13.1								15.2													15.2
Net earnings										77.6										77.6										27.8											27.8
Separation of Armstrong Flooring, Inc.							(660.7	)									56.8			(603.9	)
Other comprehensive income																	11.3			11.3																		11.5			11.5
Acquisition of treasury stock		(187,331	)									187,331		(7.8	)					(7.8	)		(1,165,247	)									1,165,247		(70.0	)					(70.0	)
Balance at end of period		55,319,221		$	0.6	$	504.2		$	442.8		5,244,713	$	(269.2	)	$	(419.3	)	$	259.1			52,198,476		$	0.6	$	532.0	$	715.5			9,175,844	$	(455.6	)	$	(388.7	)	$	403.8

See accompanying notes to Condensed Consolidated Financial Statements beginning on page 8.

	Nine Months Ended September 30,							Three Months Ended March 31,
	2017			2016				2019			2018
Cash flows from operating activities:
Net earnings	$	121.1		$	77.6			$	39.1		$	27.8
Adjustments to reconcile net earnings to net cash provided by (used for) operating activities:
Adjustments to reconcile net earnings to net cash provided by operating activities:							Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization		62.9			70.1				15.1			22.8
Write off of debt financing costs		-			1.1
(Gain) loss on disposal of discontinued operations									(2.2	)		17.7
Deferred income taxes		53.0			28.0				5.0			1.5
Share-based compensation		8.1			9.6				1.8			2.6
Excess tax benefit from share-based awards		-			(5.8	)
Equity earnings from joint venture		(51.9	)		(57.0	)			(18.9	)		(16.3	)
Separation costs		-			33.0
Loss on interest rate swap		-			10.7
U.S. pension expense		2.0			11.8
U.S. pension (credit)									(1.9	)		(6.6	)
Other non-cash adjustments, net		(0.5	)		(4.2	)			0.2			(0.8	)
Changes in operating assets and liabilities:
Receivables		(27.4	)		(41.3	)			3.5			22.5
Inventories		(1.5	)		(4.4	)			(11.4	)		(17.3	)
Other current assets		(3.6	)		11.5				(1.1	)		(0.9	)
Lease right-of-use assets									3.2			-
Other non-current assets		(3.3	)		(7.0	)			(3.0	)		(0.6	)
Accounts payable and accrued expenses		(35.9	)		(88.2	)			(5.0	)		(26.4	)
Income taxes payable		(7.8	)		(24.1	)			5.3			5.9
Non-current lease liabilities									(3.6	)		-
Other long-term liabilities		(8.8	)		(19.4	)			(11.7	)		(4.6	)
Other, net		(1.5	)		(4.6	)			0.3			(1.3	)
Net cash provided by (used for) operating activities		104.9			(2.6	)
Net cash provided by operating activities									14.7			26.0
Cash flows from investing activities:
Purchases of property, plant and equipment		(63.2	)		(75.7	)			(14.8	)		(10.2	)
Return of investment from joint venture		52.8			68.5				19.7			16.0
Cash paid for acquisition		(31.4	)		-
Cash paid for acquisitions									(43.1	)		-
Other investing activities		0.5			0.3				0.2			-
Net cash (used for) investing activities		(41.3	)		(6.9	)
Net cash (used for) provided by investing activities									(38.0	)		5.8
Cash flows from financing activities:
Proceeds from revolving credit facility and other short-term debt		103.0			90.0
Payments of revolving credit facility and other short-term debt		(103.0	)		(90.0	)
Proceeds from long-term debt		-			363.5
Payments of long-term debt		(16.8	)		(432.8	)			(8.1	)		(8.1	)
Financing costs		(0.6	)		(8.1	)
Dividend paid									(8.5	)		-
Proceeds from exercised stock options		0.6			0.3				4.8			13.9
Cash transferred to Armstrong Flooring, Inc.		-			(9.1	)
Excess tax benefit from share-based awards		-			5.8
Payment for treasury stock acquired		(75.4	)		(7.8	)			(20.0	)		(70.0	)
Other financing activities									1.9			-
Net cash (used for) financing activities		(92.2	)		(88.2	)			(29.9	)		(64.2	)
Effect of exchange rate changes on cash and cash equivalents		3.2			(4.6	)			1.3			(0.3	)
Net (decrease) in cash and cash equivalents		(25.4	)		(102.3	)			(51.9	)		(32.7	)
Cash and cash equivalents at beginning of year		141.9			244.8				335.7			159.6
Cash and cash equivalents at end of period	$	116.5		$	142.5				283.8			126.9
Cash and cash equivalents at end of period of discontinued operations									10.0			10.0
Cash and cash equivalents at end of period of continuing operations								$	273.8		$	116.9
Supplemental Cash Flow Disclosures:
Interest paid	$	23.1		$	25.2			$	10.8		$	7.7
Income tax payments, net		20.2			23.9				3.0			1.8
Amounts in accounts payable for capital expenditures		1.8			4.7				0.9			2.3

See accompanying notes to Condensed Consolidated Financial Statements beginning on page 8.

Armstrong World Industries, Inc. (“AWI”) is a Pennsylvania corporation incorporated in 1891. When we refer to “AWI,” the “Company,” “we,” “our” or “us” in these notes, we are referring to AWI and its subsidiaries.

The accounting policies used in preparing the Condensed Consolidated Financial Statements in this Form 10-Q are the same as those used in preparing the Consolidated Financial Statements for the year ended December 31, ~~2016.~~2018. These statements should therefore be read in conjunction with the Consolidated Financial Statements and notes that are included in the Form 10-K for the fiscal year ended December 31, ~~2016.~~2018. In the opinion of management, all adjustments of a normal recurring nature have been included to provide a fair statement of the results for the reporting periods presented. Operating results for the ~~third~~first quarter of 2019 and ~~first nine months of 2017 and 2016~~2018 included in this report are unaudited. Quarterly results are not necessarily indicative of annual earnings, primarily due to the different level of sales in each quarter of the year and the possibility of changes in general economic conditions.

On ~~April~~March 4, 2019, we acquired the business and assets of Architectural Components Group, Inc. (“ACGI”), based in Marshfield, Missouri. ACGI is a manufacturer of custom wood ceilings and walls with one manufacturing facility. ACGI’s operations, and its assets and liabilities, are included as a component of our Architectural Specialties segment. See Note 4 for further information.

On August 16, 2018, we acquired the business and assets of Steel Ceilings, Inc. (“Steel Ceilings”), based in Johnstown, Ohio. Steel Ceilings is a manufacturer of aluminum and stainless metal ceilings that include architectural, radiant and security solutions with one manufacturing facility. Steel Ceilings’ operations, and its assets and liabilities, are included as a component of our Architectural Specialties segment. See Note 4 for further information.

On May 31, 2018, we acquired the business and assets of Plasterform, Inc. (“Plasterform”), based in Mississauga, Ontario, Canada. Plasterform is a manufacturer of architectural cast ceilings, walls, facades, columns and moldings with one manufacturing facility. Plasterform’s operations, and its assets and liabilities, are included as a component of our Architectural Specialties segment. See Note 4 for further information.

On November 17, 2017, we entered into a Share Purchase Agreement (the “Purchase Agreement”) with Knauf International GmbH (“Knauf”), to sell certain subsidiaries comprising our business in Europe, the Middle East and Africa (including Russia) (“EMEA”) and the Pacific Rim, including the corresponding businesses and operations conducted by Worthington Armstrong Venture (“WAVE”), our joint venture with Worthington Industries, Inc. (“Worthington”) in which AWI holds a 50% interest. The Purchase Agreement provides that the consideration to be paid by Knauf in connection with the sale is $330.0 million in cash, inclusive of amounts due to WAVE, subject to certain adjustments as provided in the Purchase Agreement, including adjustments based on the economic impact of any required regulatory remedies and a working capital adjustment.

On July 18, 2018, we entered into an amendment to the Purchase Agreement, pursuant to which Knauf agreed to irrevocably and unconditionally pay AWI (i) $250 million on August 1, ~~2016,~~2018, and (ii) $80 million on September 15, 2018, if, prior to such date (A) any competition condition has not been satisfied, or (B) the closing has not yet occurred. The amendment also provided for the reduction (from a maximum of $35 million to a maximum of $20 million) of potential adjustments to the purchase price consideration for the transaction based on the impact of remedies required to satisfy competition conditions. We received both the $250 million payment and the $80 million payment from Knauf in the third quarter of 2018. Following receipt of these payments, we ~~completed~~remitted $70 million to WAVE in partial consideration of the purchase price payable in respect of the business and operations of WAVE under the transaction. WAVE subsequently paid each of AWI and Worthington a dividend of $35 million. We also recorded a $22.4 million payable to WAVE, which is reflected within Accounts Payable and Accrued Expenses. The total consideration payable by AWI to WAVE will be determined following closing in connection with the calculation of the adjustments contemplated by the Purchase Agreement.

The transaction was notified for merger control clearance in the European Union (“EU”), Bosnia and Herzegovina, Macedonia, Montenegro, Russia and Serbia, and was cleared unconditionally in Montenegro (February 2018), Serbia (February 2018), Russia (March 2018), Macedonia (July 2018) and Bosnia and Herzegovina (August 2018). On December 7, 2018, the European Commission granted conditional clearance of the transaction, subject to certain commitments intended to address concerns regarding the overlap between the activities of AWI and Knauf, including the divestment by Knauf to a third party of certain mineral fiber and grid businesses and operations in Austria, Estonia, Germany, Ireland, Italy, Latvia, Lithuania, Portugal, Spain, Turkey and the United Kingdom (“UK”). This includes our ~~separation~~sales operations in each of the relevant countries, as well as our production facilities, and those of WAVE, located in Team Valley, UK. The terms of the sale of the divestment business by Knauf and the identity of the purchaser are subject to the approval of the European Commission.

Armstrong ~~Flooring,~~World Industries, Inc. ~~(“AFI”). AFI’s~~, and Subsidiaries

Upon or prior to closing, we expect to enter into (i) a Transition Services Agreement with Knauf for its benefit and the benefit of the buyer of the divestment business under which we will provide certain transition technology and information technology services for a limited period of time following closing, (ii) an intellectual property License Agreement with Knauf for its benefit and the benefit of the buyer of the divestment business under which we will license certain patents, trademarks and know-how for their use in certain licensed territories, and (iii) a Supply Agreement with each of Knauf and the buyer of the divestment business under which the parties may continue to purchase certain products from each other following closing. WAVE will enter into similar agreements with Knauf and/or the buyer of the divestment business for such purposes.

We continue to work closely with Knauf towards closing and expect the transaction to close during the second quarter of 2019. The EMEA and Pacific Rim segment historical financial results have been reflected in AWI’s Condensed Consolidated Financial Statements as a discontinued ~~operation~~operations for all periods presented. Separation costs for the three and nine months ended September 30, 2016 were $2.0 million and $33.0 million, respectively. Separation costs were recorded within the Unallocated Corporate segment. Separation costs primarily related to outside professional services and employee compensation, retention and severance accruals.

~~On January 13, 2017, we acquired the business and assets of Tectum, Inc. (“Tectum”), based in Newark, Ohio. Tectum is a~~ ~~manufacturer of acoustical ceiling, wall and structural solutions for commercial building applications with two manufacturing facilities.~~ Tectum’s operations from the date of acquisition, and its assets and liabilities as of September 30, 2017, have been included as a component of our Americas segment. See Note 3 for additional information.

These Condensed Consolidated Financial Statements are prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). The statements include management estimates and judgments, where appropriate. Management utilizes estimates to record many items including certain asset values, allowances for bad debts, inventory obsolescence and lower of cost and net realizable value charges, warranty reserves, workers’ compensation, general liability and environmental claims, and income taxes. When preparing an estimate, management determines the amount based upon the consideration of relevant information. Management may confer with outside parties, including outside counsel. Actual results may differ from these estimates.

~~Certain prior year amounts have been recast in the Condensed Consolidated Financial Statements to conform to the 2017 presentation.~~

In ~~July 2015,~~February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) ~~2015-11,~~ ~~“Simplifying the Measurement of Inventory,”~~ which requires inventory that is measured on a first-in, first-out or average cost basis to be measured at lower of cost and net realizable value, as opposed to the lower of cost or market. For inventory that is measured under the last-in, first-out (“LIFO”) basis or the retail recovery method, there is no change to current measurement requirements. The adoption of this standard on January 1, 2017 did not have an impact on our financial condition, results of operations or cash flows.

~~In March 2016, the FASB issued ASU 2016-09,~~ ~~“Improvements to Employee Share-Based Payment Accounting.”~~ This new guidance simplifies accounting for share-based payments, most notably by requiring all excess tax benefits and tax deficiencies to be recorded as income tax benefits or expense in the income statement and by allowing entities to recognize forfeitures of awards when they occur. Effective January 1, 2017, we adopted the provisions of ASU 2016-09 and elected to continue to estimate the impact of forfeitures when determining share-based compensation cost. We prospectively adopted the provisions of this new guidance related to the recognition of excess tax benefits and deficiencies through income tax expense, the presentation of excess tax benefits from share-based compensation as operating cash outflows, and changes to diluted earnings per share computations, the impact of which were not material to our Condensed Consolidated Statements of Earnings and Comprehensive Income or Condensed Consolidated Statements of Cash Flows. Finally, as required by ASU 2016-09, effective January 1, 2017, we recorded an $8.7 million cumulative-effect increase to Retained earnings and Deferred income taxes (assets), representing prior years’ tax benefits that were not previously recognized because the related tax deductions had not reduced income taxes payable.

~~In May 2014, the FASB issued ASU 2014-09,~~ ~~“Revenue from Contracts with Customers.”~~ ~~The guidance requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to a customer. The~~

~~ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. In March 2016, the FASB issued ASU 2016-08,~~ ~~“Principal versus Agent Considerations (Reporting Gross versus Net),”~~ ~~which clarifies the implementation guidance relating to principle versus agent considerations. In April 2016, the FASB issued ASU 2016-10,~~ ~~“Identifying Performance Obligations and Licensing,”~~ which clarifies the implementation guidance relating to the identification of performance obligations in a contract, including how entities should account for shipping and handling services it provides after control of goods transfers to a customer. In May 2016, the FASB issued ASU 2016-12, ~~“Narrow-Scope Improvements and Practical Expedients,”~~ ~~which clarifies the guidance related to the presentation of sales taxes, noncash consideration, and completed contracts and contract modifications. In December 2016, the FASB issued ASU 2016-20,~~ ~~“Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers,”~~ ~~which clarifies the scope and application of the adoption of the new revenue recognition standard.~~

Collectively, the revenue recognition ASC updates are effective for annual reporting periods beginning after December 15, 2017, but early adoption is permitted. We intend to adopt these standards effective January 1, 2018 using the modified retrospective transition method and also intend to apply all practical expedients related to completed contracts upon adoption. Substantially all of our revenues from contracts with customers are recognized from the sale of products with standard shipping terms, sales discounts and warranties. As such, and based on our evaluation to date, we do not believe adoption will have a material impact to our financial condition, results of operations or cash flows as we expect the amount and timing of substantially all of our revenues will continue to be recognized at a point in time. Upon adoption, we will be impacted by the expanded disclosure requirements of the revenue recognition ASC updates, most notably the disclosure of revenues from contracts with customers into disaggregated categories. We are still assessing the impact of the new disclosure requirements of the revenue recognition ASC updates.

~~In January 2016, the FASB issued ASU 2016-01,~~ ~~“Recognition and Measurement of Financial Assets and Financial Liabilities,”~~ which addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. Most notably, this new guidance requires equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income. This new guidance is effective for annual reporting periods beginning after December 15, 2017. We do not believe the adoption of this standard will have a material impact on our financial condition, results of operations and cash flows.

~~In February 2016, the FASB issued ASU~~ 2016-02, “Leases,” which amends accounting for leases, most notably by requiring a lessee to recognize the assets and liabilities that arise from a lease agreement. Specifically, this new guidance ~~will require~~requires lessees to recognize a liability to make lease payments and a right-of-use (“ROU”) asset representing its right to use the underlying asset for the lease term, with limited exceptions. ~~The accounting applied by a lessor is largely unchanged from~~

In January 2018, FASB issued ASU 2018-01, “Land Easement Practical Expedient for Transition to Topic 842,” which permits an entity to elect an optional transition practical expedient to not evaluate under Topic 842 land easements that applied under existing U.S. GAAP. This new guidance is effective for annual reporting periods beginning after December 15, 2018 and must be adopted under a modified retrospective basis. We are currently evaluating the impactexist at transition or expired before the adoption of ~~this standard will have on our financial condition, results of operations~~Topic 842 and ~~cash flows.~~

that were not previously accounted for as leases under Topic 840. In ~~August 2016, the~~July 2018, FASB issued ASU ~~2016-15~~,2018-10, “~~Classification of Certain Cash Receipts and Cash Payments.~~Codification improvements to Topic 842, Leases,” ~~This~~which affects narrow aspects of the guidance ~~clarifies how entities should classify~~issued in the amendments in Update 2016-02. In July 2018, FASB also issued ASU 2018-11, “Targeted Improvements,” which allows companies to adopt ASC Topic 842 without revising comparative period reporting or disclosures and provides an optional practical expedient for lessors to not separate lease and non-lease components of a contract when certain ~~cash receipts~~criteria are met.

Effective January 1, 2019, we adopted these standards using the modified retrospective transition method and ~~cash payments~~have applied all practical expedients related to leases existing at the date of initial application. Upon adoption, the most significant change was to the Condensed Consolidated Balance Sheet related to the recognition of new ROU assets and lease liabilities on a continuing operations basis. We have recognized ROU assets and lease liabilities of $28.8 million, based on the ~~statement~~present value of ~~cash flows. This new guidance is effective~~the future minimum rental payments for ~~annual periods beginning after December 15, 2017.~~existing operating leases. We ~~are currently evaluating the impact the adoption of this standard will~~ have ~~on our cash flows.~~

~~In March 2017, the FASB issued ASU 2017-07,~~ ~~“Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost,”~~ ~~which requires companies to report the service cost component of net benefit cost in the same line item or items~~no leases that classify as ~~other compensation costs arising from services rendered~~financing arrangements. As required by the ~~pertinent employees during the period. The other components~~lease ASC updates, we have expanded our disclosure of net benefit cost are required to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations, if one is presented. This new guidance is effective for annual periods beginning after December 15, 2018 and will have an impact on the classification of net benefit costs, which are currently included as a component of Costs of goods sold and Selling, general and administrative (“SG&A”) expenses, on our Condensed Consolidated Statements of Earnings and Comprehensive Income.leases. See Note 139 for ~~details related to our components of net benefit costs.~~additional information.

In August 2017, the FASB issued ASU 2017-12, “Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities,” which amends the financial reporting of hedging relationships in order to better portray the economic results of an entity’s risk management activities in its financial statements. In addition, ~~this new~~the guidance simplifies the application of current hedge accounting guidance. ~~This new~~Effective January 1, 2019, we adopted the guidance, ~~is effective for annual periods beginning after December 15, 2018. We are currently evaluating the~~which had no material impact ~~the adoption of this standard will have~~ on our financial condition, results of operations ~~and~~or cash flows.

In June 2018, the FASB issued ASU 2018-07, “Improvements to Nonemployee Share-Based Payment Accounting,” which simplifies the aspects of accounting for non–employee share-based payment transactions resulting from expanding the scope of ASC Topic 718, Compensation – Stock Compensation, to include share-based payment transactions for acquiring goods and services from non-employees. Effective January 1, 2019, we adopted this standard using the modified retrospective transition method. Our adoption of this standard had no material impact on our financial condition, results of operations or cash flows.

In August 2018, the FASB issued ASU 2018-14, “Disclosure Framework – Changes to the Disclosure Requirements for Defined Benefit Plans” which amends ASC 715-20, Compensation – Retirement Benefits – Defined Benefit Plans. The ASU modifies the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans. The disclosure requirements to be removed include the amounts in accumulated other comprehensive income expected to be recognized in net periodic benefit costs over the next fiscal year, the amount and timing of plan assets expected to be returned to the employer and the effect of a one percentage point change in assumed health care cost trend rates on the aggregate service cost and benefit obligation for postretirement health care benefits. The new disclosure requirements include the interest crediting rates for cash balance plans, and an explanation of significant gains and losses related to changes in benefit obligations. This guidance is effective for fiscal years ending after December 15, 2020. We are currently evaluating the impact the adoption of this standard will have on our financial condition, results of operations and cash flows.

In August 2018, the FASB issued ASU 2018-15, “Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract” which amends ASC 350-40 Intangibles – Goodwill and Other – Internal-Use Software. The ASU requires implementation costs incurred by customers in cloud computing arrangements to be deferred and recognized over the term of the arrangement, if these costs were capitalized by the customer in a software licensing arrangement. This guidance is effective for fiscal years beginning after December 15, 2019. We are currently evaluating the impact the adoption of this standard will have on our financial condition, results of operations and cash flows.

Our reportable operating segments consist of the following three distinct geographical segments: Americas (including Canada); Europe, Middle East and Africa (including Russia) (“EMEA”); and Pacific Rim. Balance sheet items classified as Unallocated Corporate primarily include cash and cash equivalents, the estimated fair value of interest rate swap contracts and outstanding borrowings under our senior credit facilities. The majority of expenses for our corporate support functions are allocated to our Americas segment.

	Three Months Ended						Nine Months Ended						Three Months Ended
	September 30,						September 30,						March 31,
	2017			2016			2017			2016			2019			2018
Segment operating income (loss)
Americas	$	67.6		$	68.6		$	214.7		$	189.0
EMEA		3.8			4.1			(1.1	)		(5.2	)
Pacific Rim		(2.4	)		1.0			(3.2	)		(2.4	)
Mineral Fiber													$	47.6		$	43.7
Architectural Specialties														9.2			8.3
Unallocated Corporate		-			(2.7	)		-			(37.1	)		(2.1	)		(2.4	)
Total consolidated operating income	$	69.0		$	71.0		$	210.4		$	144.3		$	54.7		$	49.6

	Three Months Ended						Nine Months Ended						Three Months Ended
	September 30,						September 30,						March 31,
	2017			2016			2017			2016			2019			2018
Total consolidated operating income	$	69.0		$	71.0		$	210.4		$	144.3		$	54.7		$	49.6
Interest expense		9.1			9.0			27.5			43.4			10.4			9.2
Other non-operating expense		1.7			-			3.6			-
Other non-operating (income)		(3.0	)		(1.6	)		(7.4	)		(8.9	)
Other non-operating (income), net														(5.5	)		(9.0	)
Earnings from continuing operations before income taxes	$	61.2		$	63.6		$	186.7		$	109.8		$	49.8		$	49.4

	September 30, 2017		December 31, 2016		March 31, 2019		December 31, 2018
Segment assets
Americas	$	1,256.7	$	1,186.7
EMEA		303.2		275.5
Pacific Rim		145.0		145.0
Mineral Fiber					$	1,118.0	$	1,096.1
Architectural Specialties						147.2		84.7
Unallocated Corporate		124.8		150.8		368.5		413.2
Total consolidated assets	$	1,829.7	$	1,758.0	$	1,633.7	$	1,594.0

~~Impairment testing of our tangible assets occurs whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable.~~

In September 2017, we made the decision to permanently close a previously idled plant in China. As a result, during the third quarter of 2017 we recorded $4.0 million in costs of goods sold for accelerated depreciation of machinery and equipment based on management estimates.

In connection with the closing of our St. Helens, Oregon Mineral Fiber manufacturing facility in the second quarter of 2018, we recorded $7.7 million in cost of goods sold related to accelerated depreciation of property, plant and equipment in the first quarter of 2018.

We recognize revenue upon transfer of control of our products to the customer, which typically occurs upon shipment. Our main performance obligation to our customers is the delivery of products in accordance with purchase orders. Each purchase order defines the transaction price for the products purchased under the arrangement. Direct sales to building materials distributors, home centers, direct customers, and retailers represent the majority of our sales. Our standard sales terms are Free On Board (“FOB”) shipping point. We have some sales terms that are FOB destination. At the point of shipment, the customer is required to pay under normal sales terms. Our normal payment terms in most cases are 45 days or less and our sales arrangements do not have any material financing components. In addition, our customer arrangements do not produce contract assets or liabilities that are material to our consolidated financial statements. Within our Architectural Specialties segment, the majority of revenues are project driven, which includes a minority of revenues derived from the sale of customer specified customized products that have no alternative use to us. The manufacturing cycle for these custom products is short.

Incremental costs to fulfill our customer arrangements are expensed as incurred, as the amortization period is less than one year.

Our products are sold with normal and customary return provisions. We provide limited warranties for defects in materials or factory workmanship, sagging and warping, and certain other manufacturing defects. Warranties are not sold separately to customers. Our product warranties place certain requirements on the purchaser, including installation and maintenance in accordance with our written instructions. In addition to our warranty program, under certain limited circumstances, we will occasionally and at our sole discretion, provide a customer accommodation repair or replacement. Warranty repairs and replacements are most commonly made by professional installers employed by or affiliated with our independent distributors. Reimbursement for costs associated with warranty repairs are provided to our independent distributors through a credit against accounts receivable from the distributor to us. Sales returns and warranty claims have historically not been material and do not constitute separate performance obligations.

We often enter into agreements with our customers to offer incentive programs, primarily volume rebates and promotions. The majority of our rebates are designated as a percentage of annual customer purchases. We estimate the amount of rebate based on actual sales for the period and accrue for the projected incentive programs costs. We record the costs of the rebate accruals as a reduction to our revenue. In addition, other sales discounts, including early pay promotions, are deducted immediately from the sales invoice.

We account for product shipping and handling costs as fulfillment activities and present the associated costs in costs of goods sold in the period in which we sell our product.

Our Mineral Fiber and Architectural Specialties operating segments both manufacture and sell ceiling systems (primarily mineral fiber, fiberglass wool, metal, and wood) throughout the Americas. We disaggregate revenue based on our product based segments and major customer grouping as these categories represent the most appropriate depiction of how the nature, amount, and timing of revenues and cash flows are affected by economic factors. Net sales by major customer group are as follows:

Distributors – represents net sales to building materials distributors, who re-sell our products to contractors, subcontractors’ alliances, large architect and design firms, and major facility owners. Geographically, this category includes sales throughout the U.S., Canada, and Latin America.

Home centers – represents net sales to home centers such as Lowe’s Companies, Inc. and The Home Depot, Inc.

Direct customers – represents net sales sold directly to contractors, subcontractors’ alliances, large architect and design firms, and major facility owners. Only sales to U.S. customers are reported within this customer group.

Retailers and other – represents net sales to independent retailers and certain national account customers, including wholesalers who re-sell our products to dealers who service builders, contractors and consumers. Geographically, this category includes sales throughout the U.S., Canada, and Latin America.

The following tables provide net sales by major customer group within the Mineral Fiber and Architectural Specialties segments for the three months ended March 31, 2019 and 2018:

On ~~January 13, 2017, in connection with~~March 4, 2019, we acquired the ~~acquisition~~business and assets of ~~Tectum, the $31.4~~ACGI. The $43.1 million purchase price, ~~for Tectum~~which is subject to customary working capital adjustments, was allocated to the tangible and intangible assets acquired and the liabilities assumed based on their estimated fair values, with the remaining unallocated amount recorded as goodwill. The total fair value of tangible assets acquired, less liabilities assumed, ~~in connection with the Tectum acquisition~~ was ~~$5.9~~$9.9 million. The total fair value of identifiable intangible assets acquired was $12.0 million, mostly comprised of amortizable customer relationships of $7.4 million and amortizable tradenames of $2.8 million, resulting in $21.2 million of goodwill. All of the acquired goodwill is deductible for tax purposes. These amounts are subject to adjustment as our purchase accounting analysis is completed.

On August 16, 2018, we acquired the business and assets of Steel Ceilings. The $12.3 million purchase price was allocated to the assets acquired and the liabilities assumed based on their estimated fair values, with the remaining amount recorded as goodwill. In October 2018, we sold certain assets related to an acquired product line to WAVE for $2.0 million. The total fair value of tangible assets acquired, less liabilities assumed, was $4.4 million. The total fair value of identifiable intangible assets acquired was mostly comprised of amortizable customer relationships of $1.4 million and tradenames of $1.3 million, resulting in $3.2 million of goodwill. All of the acquired goodwill is deductible for tax purposes.

On May 31, 2018, we acquired the business and assets of Plasterform. The $11.9 million purchase price was allocated to the assets acquired and the liabilities assumed based on their estimated fair values, with the remaining amount recorded as goodwill. The total fair value of tangible assets acquired, less liabilities assumed, was $2.2 million. The total fair value of identifiable intangible assets acquired, comprised of amortizable customer relationships, ~~and non-amortizing brand names,~~ was ~~$16.0~~$4.8 million, resulting in ~~$9.5~~$4.9 million of goodwill. All of the acquired goodwill is deductible for tax purposes.

On November 17, 2017, we agreed to sell certain subsidiaries comprising our businesses in EMEA and the Pacific Rim to Knauf.

Each quarter we compare the anticipated sales proceeds from Knauf to the carrying value of EMEA and Pacific Rim net assets. We record an estimated loss if the carrying value exceeds the anticipated sales proceeds. Net gains can only be recorded to the extent of previous estimated losses. In 2017, we recorded an estimated loss of $74.0 million, which included $51.4 million of unfavorable Accumulated Other Comprehensive Income (“AOCI”) adjustments. In 2018, we recorded an estimated loss of $19.3 million, which included $25.5 million of unfavorable AOCI adjustments. During the three months ended March 31, 2019, we recorded a net gain of $2.2 million, which included $9.1 million of favorable AOCI adjustments. These AOCI adjustments related primarily to accumulated foreign currency translation amounts that will be subsequently reclassified to earnings from discontinued operations upon sale of our EMEA and Pacific Rim businesses.

On April 1, 2016, inwe completed our separation of Armstrong Flooring, Inc. (“AFI”) by allocating the assets and liabilities related primarily to our Resilient and Wood Flooring segments to AFI and then distributing the common stock of AFI to our shareholders at a ratio of one share of AFI common stock for every two shares of AWI common stock.

In connection with the separation and distribution of AFI, we entered into several agreements with AFI that, together with a plan of division, provide for the separation and allocation between AWI and AFI of the flooring assets, employees, liabilities and obligations of AWI and its subsidiaries attributable to periods prior to, at and after AFI’s separation from AWI, and govern the relationship between AWI and AFI subsequent to the completion of the separation and distribution. These agreements include a ~~Transition Services Agreement, a~~ Tax Matters Agreement, an Employee Matters Agreement, a Trademark License Agreement, a Transition Trademark License Agreement and a Campus Lease Agreement. Under the Transition Services Agreement, AWI and AFI will provide various services to each other during a transition period expiring no later than December 31, 2017. We do not expect to extend the Transition Services Agreement beyond December 31, 2017.

~~The following is a summary of the results of operations related to AFI, our former Resilient Flooring and Wood Flooring segments, which are presented as discontinued operations.~~

The following is a summary of total depreciation and amortization and capital expenditures related to AFI which are presented as discontinued operations and included as components of operating and investing cash flows on our consolidated statements of cash flows:

On December 4, 2014, our Board of Directors approved the cessation of funding to our DLW subsidiary, which at that time was our European flooring business. As

The following tables detail the businesses and line items that comprise discontinued operations on the Condensed Consolidated Statements of Earnings and Comprehensive Income.

The following is a result, DLW management filed for insolvency in Germany on December 11, 2014. The German insolvency court subsequently appointed an administrator (the “Administrator”) to oversee DLW operations.

Assummary of ~~December 4, 2014, DLW had a net liability~~the carrying amount of ~~$12.9 million, representing~~major classes of assets ~~of $151.9 million~~and liabilities classified as assets and liabilities of ~~$164.8 million, which were removed from~~discontinued operations as of March 31, 2019 and December 31, 2018 related to our balance sheet. This net liability was recognized as a contingent liability on our consolidated balance sheet pending the closure of the insolvency proceeding. The net liability, included within Accounts payableEMEA and ~~accrued~~Pacific Rim businesses.

expenses on our Condensed Consolidated Balance Sheets, was $11.9 million as of December 31, 2016. In April 2017, we entered into a settlement agreement and mutual release with the Administrator on behalf of the DLW estate to settle all claims of the Administrator related to the insolvency for a cash payment of $11.8 million. DLW was previously shown within our Resilient Flooring reporting segment.

The following is a summary of ~~the results~~total estimated gains and losses, capital expenditures, and operating lease information related to ~~the flooring~~our EMEA and Pacific Rim businesses which are presented as discontinued operations and included ~~in discontinued operations.~~as components of operating and investing cash flows on our Condensed Consolidated Statements of Cash Flows:

During the third quarter of 2017, a non-cash income tax benefit of $5.9 million was recorded within discontinued operations due to the reversal of reserves for uncertain tax positions as a result of an expiration of the federal statute of limitations to review previously filed income tax returns.

	September 30, 2017			December 31, 2016			March 31, 2019			December 31, 2018
Customer receivables	$	131.2		$	106.9		$	85.4		$	70.4
Customer notes		0.5			1.5
Miscellaneous receivables		16.4			6.0			3.1			11.5
Less allowance for warranties, discounts and losses		(5.6	)		(6.1	)		(3.2	)		(2.0	)
Accounts and notes receivable, net	$	142.5		$	108.3		$	85.3		$	79.9

~~Generally, we~~We sell our products to select, pre-approved customers whose businesses are affected by changes in economic and market conditions. We consider these factors and the financial condition of each customer when establishing our allowance for losses from doubtful accounts.

Miscellaneous receivables as of ~~September 30, 2017 include~~March 31, 2019 included $1.7 million of insurance recoveries related to environmental ~~matters.~~matters that we expect to collect during the second quarter of 2019. Miscellaneous receivables as of December 31, 2018 included $6.5 million of insurance recoveries related to environmental matters, which were collected during the first quarter of 2019. See Note 1820 for additional information.

	September 30, 2017			December 31, 2016			March 31, 2019			December 31, 2018
Finished goods	$	82.6		$	80.5		$	40.1		$	38.8
Goods in process		4.0			3.3			4.9			4.4
Raw materials and supplies		39.1			32.4			37.2			27.8
Less LIFO reserves		(7.9	)		(7.2	)		(10.1	)		(9.8	)
Total inventories, net	$	117.8		$	109.0		$	72.1		$	61.2

	September 30, 2017		December 31, 2016		March 31, 2019		December 31, 2018
Prepaid expenses	$	21.4	$	15.0	$	7.3	$	4.1
Fair value of derivative assets		0.4		2.4
Other		1.8		3.4		0.9		0.7
Total other current assets	$	23.6	$	20.8	$	8.2	$	4.8

Investment in joint venture ~~as of September 30, 2017 reflected~~reflects our 50% equity interest in WAVE. The WAVE joint venture is reflected within the Mineral Fiber segment in our consolidated financial statements using the equity method of accounting. On November 17, 2017, in connection with the Purchase Agreement we entered into with Knauf, the corresponding European and Pacific Rim businesses of WAVE will also be subject to sale to Knauf. Accordingly, WAVE’s European and Pacific Rim historical financial statement results have been reflected in WAVE’s consolidated financial statements as a discontinued operation for all periods presented. Condensed income statement data for WAVE is summarized below. ~~Segment results relating~~

We enter into operating leases for certain real estate, equipment and automobiles. Our leases have remaining lease terms of 1 to ~~WAVE, however, consist primarily~~15 years, with several leases including options for us to purchase leased items at fair value or renew for up to 5 years, or multiple 5-year renewal periods, and some of ~~equity earnings, as~~which include options to terminate the lease within 1 year. We have lease agreements with lease and non-lease components, which are accounted for separately. For purposes of calculating operating lease liabilities, lease terms may be deemed to include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Short-term leases with an initial term of 12 months or less are not recorded on the balance sheet. We recognize lease expense for these leases on a straight line basis over the lease term. Short-term lease expense was not material for the three months ended March 31, 2019. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at the lease commencement date in determining the present value of lease payments. We used the incremental borrowing rate on January 1, 2019 for operating leases that commenced prior to that date. Our lease agreements do not contain any residual value guarantees or material restrictive covenants. As of March 31, 2019, we do not ~~consolidate~~have any financing leases and we have no additional operating leases that have not yet commenced.

As noted in Note 1, effective January 1, 2019, we adopted ASC Topic 842 using the ~~sales, profit or earnings of WAVE~~modified retrospective transition method. As such, we did not restate financial statement and lease disclosure data for all periods prior to January 1, 2019, which was prepared in accordance with ASC Topic 840 – Leases.

The following table presents our ~~results.~~ operating lease cost and supplemental cash flow information related to our operating leases:

We do not believe the amount of cash paid for amounts included in the measurement of lease liabilities to be materially different from our operating lease cost for the three months ended March 31, 2019.

The following table presents weighted average assumptions used to compute our ROU assets and lease liabilities:

Undiscounted future minimum lease payments as of March 31, 2019, by year and in the aggregate, having non-cancelable lease terms in excess of one year are as follows:

Future minimum lease payments as of December 31, 2018, by year and in the aggregate, having non-cancelable lease terms in excess of one year were expected to be as follows:

The following table details amounts related to our goodwill and intangible assets as of ~~September 30, 2017~~March 31, 2019 and December 31, ~~2016.~~2018.

		September 30, 2017				December 31, 2016					March 31, 2019				December 31, 2018
	Estimated Useful Life	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization		Estimated Useful Life	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Amortizing intangible assets
Customer relationships	20 years	$	176.3	$	91.7	$	165.3	$	84.9	3-20 years	$	188.9	$	105.5	$	181.4	$	103.0
Developed technology	15 years		83.4		59.5		82.8		55.4	15 years		84.6		67.9		84.3		66.5
Trademarks and brand names										5-20 years		3.9		0.1		1.1		0.2
Other	Various		13.3		1.8		13.2		2.0	Various		7.8		1.4		5.6		1.2
Total		$	273.0	$	153.0	$	261.3	$	142.3		$	285.2	$	174.9	$	272.4	$	170.9
Goodwill and non-amortizing intangible assets
Trademarks and brand names	Indefinite		319.6				314.4			Indefinite		321.4				321.3
Goodwill	Indefinite		10.7				1.1			Indefinite		40.6				19.2
Total goodwill and intangible assets		$	603.3			$	576.8				$	647.2			$	612.9

	September 30, 2017		December 31, 2016		March 31, 2019		December 31, 2018
Payables, trade and other	$	100.9	$	108.6	$	76.0	$	82.2
Current portion of lease liabilities						5.2		-
Employment costs		26.4		33.7		6.6		18.6
Current portion of pension and postretirement liabilities		13.0		12.7		11.1		10.9
Contingent liability related to discontinued operations		-		11.9
Advance receipt of Knauf proceeds						237.6		237.6
Payable to WAVE for advance receipt of Knauf proceeds						22.4		22.4
Current portion of environmental liabilities						9.6		0.7
Other		29.5		30.2		22.4		10.9
Total accounts payable and accrued expenses	$	169.8	$	197.1	$	390.9	$	383.3

During the first quarter of 2016, we recorded $2.4 million in Unallocated Corporate for severance and related costs (including for our former Chief Executive Officer) as a result of the separation of AFI. These costs are reflected within Separation costs on the Condensed Consolidated Statements of Earnings and Comprehensive Income.

During the second and third quarters of 2016, we recorded $3.0 million and $0.5 million, respectively, in costs of goods sold for severance and related costs related to the idling of one of our plants in China.

	Three Months Ended						Nine Months Ended						Three Months Ended
	September 30,						September 30,						March 31,
	2017			2016			2017			2016			2019			2018
Earnings from continuing operations before income taxes	$	61.2		$	63.6		$	186.7		$	109.8		$	49.8		$	49.4
Income tax expense		17.7			7.7			70.9			44.4			13.4			8.2
Effective tax rate		28.9	%		12.1	%		38.0	%		40.4	%		26.8	%		16.6	%

The effective tax rate for the ~~third~~first quarter ~~of 2017~~ was higher compared to the same period in ~~2016 as income tax benefits resulting from the reversal of reserves for uncertain tax positions~~2018 primarily due to the ~~expiration~~favorable impact of ~~the federal statute of limitations were less~~share-based compensation deductions in the ~~third~~first quarter of ~~2017 compared to the same period of 2016. Excluding the impact of the increase~~2018 that did not recur as extensively in ~~pre-tax income, the effective rate for~~ the first ~~nine months~~quarter of ~~2017 was lower in comparison to the same period in 2016 as income tax expense in 2016 was negatively impacted by the separation of AFI.~~ 2019.

It is reasonably possible that the amount of unrecognized tax benefits could significantly increase or decrease within the next twelve months. However, an estimate of the range of reasonably possible outcomes cannot be made. Changes to unrecognized tax benefits could result from the completion of ongoing examinations, the expiration of the statute of limitations or other unforeseen circumstances.

~~As of September 30, 2017, we consider foreign unremitted earnings to be permanently reinvested.~~

As of ~~September 30, 2017~~March 31, 2019 and December 31, ~~2016,~~2018, our long-term debt included borrowings outstanding under our $1,050.0 million variable rate senior credit facility, which is comprised of a $200.0 million revolving credit facility (with a $150.0 million sublimit for letters of credit), a $600.0 million Term Loan A and a $250.0 million Term Loan B. ~~We also have a $25.0 million letter of credit facility, also known as our bi-lateral facility.~~ As of ~~September 30, 2017~~March 31, 2019 and December 31, ~~2016,~~2018, there were no borrowings outstanding on our revolving credit facility. As of ~~September 30, 2017~~March 31, 2019 and December 31, ~~2016,~~2018, our outstanding long-term debt included a $35.0 million variable rate, tax-exempt industrial development bond that financed the construction of a U.S. plant in prior years.

~~In February 2017, we repriced the interest rate on~~ We also have a $25.0 million letter of credit facility, also known as our Term Loan B borrowing, resulting in a lower LIBOR spread (2.75% vs. 3.25%). The maturity date and all other terms and conditions remained unchanged. In connection with the refinancing, we paid $0.6 million of bank, legal and other fees, the majority of which were capitalized.bi-lateral facility.

We utilize lines of credit and other commercial commitments in order to ensure that adequate funds are available to meet operating requirements. Letters of credit are currently arranged through our revolving credit facility, our bi-lateral facility and our securitization facility. ~~In addition, our foreign subsidiaries’ available lines of credit are available for letters of credit and guarantees.~~ Letters of credit are issued to third party suppliers, insurance institutions and financial institutions and typically can only be drawn upon in the event of AWI’s failure to pay its obligations to the beneficiary. The following table presents details related to our letters of ~~credit:~~credit facilities:

	As of September 30, 2017							As of March 31, 2019
Financing Arrangements	Limit		Used		Available			Limit		Used		Available
Accounts receivable securitization facility	$	33.7	$	36.2	$	(2.5	)	$	31.9	$	36.2	$	(4.3	)
Bi-lateral facility		25.0		17.1		7.9			25.0		13.4		11.6
Revolving credit facility		150.0		-		150.0			150.0		-		150.0
Foreign lines of credit		0.2		-		0.2
Total	$	208.9	$	53.3	$	155.6		$	206.9	$	49.6	$	157.3

As of ~~September 30, 2017~~March 31, 2019 and December 31, ~~2016, $2.5~~2018, $4.3 million and ~~$4.0~~$6.0 million ~~respectively,~~ of letters of credit issued under our accounts receivable securitization facility in excess of our maximum limit were classified as restricted cash and reported as a component of Cash and cash equivalents on our Condensed Consolidated Balance Sheets. This restriction will lapse upon replacement of collateral with accounts receivable balances and/or upon a change in the letter of credit limit as a result of higher securitized accounts receivable balances.

14As of March 31, 2019, we had a $36.2 million Accounts Receivable Securitization Facility with the Bank of Nova Scotia (the “funding entity”) that matures in March 2020. Under our Accounts Receivable Securitization Facility we sell accounts receivables to

Armstrong Receivables Company, LLC (“ARC”), a Delaware entity that is consolidated in these financial statements. ARC is a 100% wholly owned single member LLC special purpose entity created specifically for this transaction; therefore, any receivables sold to ARC are not available to the general creditors of AWI. ARC then sells an undivided interest in the purchased accounts receivables to the funding entity. This undivided interest acts as collateral for drawings on the facility. Any borrowings under this facility are obligations of ARC and not AWI. ARC contracts with and pays a servicing fee to AWI to manage, collect and service the purchased accounts receivables. All new receivables under the program are continuously purchased by ARC with the proceeds from collections of receivables previously purchased. As of March 31, 2019, we had no borrowings under this facility.

	Three Months Ended						Nine Months Ended						Three Months Ended
	September 30,						September 30,						March 31,
	2017			2016			2017			2016			2019			2018
U.S. defined-benefit plans:
U.S. defined benefit plans:
Pension benefits
Service cost of benefits earned during the period	$	2.2		$	2.2		$	6.4		$	8.0		$	1.2		$	1.4
Interest cost on projected benefit obligation		12.1			16.5			37.0			53.4			12.6			11.5
Expected return on plan assets		(24.7	)		(26.2	)		(74.3	)		(84.4	)		(20.1	)		(24.0	)
Amortization of prior service cost		0.4			0.4			1.1			1.3
Amortization of net actuarial loss		4.3			11.4			12.8			36.8			4.8			5.0
Partial settlement		20.8			-			20.8			-
Net periodic pension cost	$	15.1		$	4.3		$	3.8		$	15.1
Less: Discontinued operations		-			-			-			2.2
Net periodic pension cost, continuing operations	$	15.1		$	4.3		$	3.8		$	12.9
Net periodic pension (credit)													$	(1.5	)	$	(6.1	)
Retiree health and life insurance benefits
Service cost of benefits earned during the period	$	0.1		$	0.1		$	0.3		$	0.3
Interest cost on projected benefit obligation		0.7			0.9			2.2			3.7		$	0.6		$	0.6
Amortization of prior service credit		-			(0.1	)		-			(0.3	)
Amortization of net actuarial gain		(0.9	)		(1.1	)		(2.7	)		(4.7	)		(2.2	)		(1.4	)
Net periodic postretirement (credit)	$	(0.1	)	$	(0.2	)	$	(0.2	)	$	(1.0	)	$	(1.6	)	$	(0.8	)
Less: Discontinued operations		-			-			-			(0.2	)
Net periodic postretirement (credit), continuing operations	$	(0.1	)	$	(0.2	)	$	(0.2	)	$	(0.8	)

Non-U.S. defined-benefit pension plans:
Service cost of benefits earned during the period	$	0.5		$	0.5		$	1.5		$	1.6
Interest cost on projected benefit obligation		1.4			1.6			4.0			5.1
Expected return on plan assets		(1.7	)		(1.9	)		(5.0	)		(5.9	)
Amortization of prior service cost		-			0.1			-			0.1
Amortization of net actuarial loss		0.4			0.3			1.0			0.9
Net periodic pension cost	$	0.6		$	0.6		$	1.5		$	1.8

We also have an unfunded non-U.S. defined benefit pension plan in ~~amortization~~Germany, which will not be acquired by Knauf in connection with the announced sale of ~~net actuarial loss~~our EMEA and Pacific Rim segments that is reported as a component of our Unallocated Corporate segment. Net periodic pension cost for ~~the U.S. defined-benefit plans~~this plan was immaterial for the three ~~and nine~~ months ended ~~September 30, 2017 in comparison to the same periods in 2016 was due to a reduction in active plan participants due to the separation of AFI. During 2016, actuarial gains~~March 31, 2019 and losses were amortized into future earnings over the expected remaining service period of plan participants, which was approximately 8 years for our U.S. defined-benefit pension plans. For 2017, actuarial gains and losses are amortized over the remaining life expectancy of plan participants, which are approximately 20 years for our U.S. defined-benefit pension plans. 2018.

Our U.S. defined benefit Retirement Income Plan (“RIP”) was amended to freeze accruals for salaried non-production employees, effective December 31, 2017. The impact of this amendment resulted in a reduction to our December 31, 2016 projected benefit obligation with a corresponding increase to unrecognized loss, resulting in no curtailment gain or loss. The impact of this amendment has been reflected in the net periodic pension credit for 2017.

In 2017, certain RIP participants with deferred vested benefits were offered an opportunity to elect a lump sum distribution of the participant’s entire accrued benefit. These distributions resulted in a partial plan settlement necessitating a plan remeasurement as of August 31, 2017. The remeasurement of the RIP’s projected benefit obligation as of August 31, 2017 includes a change to the MP-2017 mortality table assumption, issued by the Society of Actuaries in October 2017. Settlement losses of $12.5 million and $8.3 million were recorded as components of cost of goods sold and SG&A expenses, respectively, during the third quarter of 2017.

We do not hold or issue financial instruments for trading purposes. The estimated fair values of our financial instruments are as follows:

	September 30, 2017						December 31, 2016						March 31, 2019						December 31, 2018
	Carrying amount			Estimated fair value			Carrying amount			Estimated fair value			Carrying amount			Estimated fair value			Carrying amount			Estimated fair value
Assets/(Liabilities), net:
Total long-term debt, including current portion	$	(857.8	)	$	(858.7	)	$	(873.6	)	$	(873.7	)	$	(812.2	)	$	(812.8	)	$	(819.8	)	$	(811.3	)
Foreign currency contracts		(1.0	)		(1.0	)		1.6			1.6
Natural gas contracts		(0.2	)		(0.2	)		1.0			1.0
Interest rate swap contracts		6.7			6.7			6.9			6.9			(3.3	)		(3.3	)		3.5			3.5

The carrying amounts of cash and cash equivalents, receivables, accounts payable, and accrued expenses ~~and short-term debt~~ approximate fair value because of the short-term maturity of these instruments. The fair value estimates of long-term debt were ~~derived from~~primarily based on quotes from a major financial institution based on recently observed trading levels of our Term Loan A and Term Loan B debt. The fair value estimates of foreign currency contract obligations are estimated from market quotes provided by a well-recognized national market data provider. The fair value estimates of natural gas contracts are estimated using internal valuation models with verification by obtaining quotes from major financial institutions. For natural gas swap transactions, fair value is calculated using NYMEX market quotes provided by a well-recognized national market data provider. For natural gas option based strategies, fair value is calculated using an industry standard Black-Scholes model with market based inputs, including but not limited to, underlying asset price, strike price, implied volatility, discounted risk free rate, and time to expiration, and is provided by a well-recognized national market data provider. The fair value estimates for interest rate swap contracts are estimated by obtaining quotes from major financial institutions with verification by internal valuation models.

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. Three levels of inputs may be used to measure fair value:

Level 1 — Quoted prices in active markets for identical assets or liabilities;

Level 2 — Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data; or

Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.

The fair value measurement of ~~assets and liabilities~~interest rate swap contracts measured at fair value on a recurring basis and reported on the ~~consolidated balance sheets is summarized below:~~

Condensed Consolidated Balance Sheets were valued using Level 2 (other observable) inputs as of March 31, 2019 and December 31, 2018. We do not have any financial assets or liabilities that are valued using Level 1 (quoted, active market) or Level 3 (unobservable) ~~inputs.~~

~~Armstrong World Industries, Inc.,~~inputs as of March 31, 2019 and ~~Subsidiaries~~December 31, 2018.

We are exposed to market risk from changes in foreign exchange rates, interest rates and commodity prices that could impact our results of operations, cash flows and financial condition. We use ~~forward~~ swaps ~~and option contracts~~ to hedge these exposures. Exposure to individual counterparties is controlled and derivative financial instruments are entered into with a diversified group of major financial institutions. Forward swaps and option contracts are entered into for periods consistent with underlying exposure and do not constitute positions independent of thoseinterest rate exposures. At inception, ~~hedges~~derivatives that we designate as hedging instruments are formally documented as either (1) a hedge of a forecasted transaction or “cash flow” hedge, or (2) a hedge of the fair value of a recognized liability or asset or “fair value” hedge. We also formally assess, both at inception and at least quarterly thereafter, whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in either the fair value or cash flows of the hedged item. If it is determined that a derivative ceases to be a highly effective hedge, or if the anticipated transaction is no longer probable of occurring, we discontinue hedge accounting and any future mark-to-market adjustments are recognized in earnings. We use derivative financial instruments as risk management tools and not for speculative trading purposes.

We only enter into derivative transactions with established financial institution counterparties having an investment-grade credit rating. We monitor counterparty credit default swap levels and credit ratings on a regular basis. All of our derivative transactions with counterparties are governed by master International Swap and Derivatives Association agreements (“ISDAs”) with netting arrangements. These agreements can limit our exposure in situations where we have gain and loss positions outstanding with a single counterparty. We do not post nor do we receive cash collateral with any counterparty for our derivative transactions. These ISDAs do not have any credit contingent features; however, a default under our bank credit facility would trigger a default under these agreements. Exposure to individual counterparties is controlled, and thus we consider the risk of counterparty default to be negligible.

We purchase natural gas and other various commodities for use in the manufacturing ~~process and to heat many of our facilities. As a result,~~process. Although we are exposed to fluctuations in ~~the price of natural gas. We~~commodity pricing, we currently have a policy to reduce cost volatility for North American natural gas purchases by purchasing natural gas forward contracts and swaps, purchased call options, and zero-cost collars up to 24 months forward. The contracts are based on forecasted usage of natural gas measured in mmBtu’s. There is a high correlation between the hedged item and theno outstanding derivative hedge instrument. The gains and losses on these instruments offset gains and losses on the transactions being hedged. These instruments are designated as cash flow hedges. As of September 30, 2017 and December 31, 2016, the notional amount of these hedges was $10.9 million and $7.4 million, respectively. The mark-to-market gain or loss on qualifying hedges is included in other comprehensive income to the extent effective, and reclassified into cost of goods sold in the period during which the underlying gas is consumed. The mark-to-market gains or losses on ineffective portions of hedges are recognized in cost of goods sold immediately. The earnings impact of the ineffective portion of these hedges was not material for the three and nine months ended September 30, 2017 and 2016. positions.

~~We manufacture~~Upon completion of the sale of our EMEA and ~~sell~~Pacific Rim businesses, and on a continuing operations basis as of March 31, 2019, our ~~products in a number of countries throughout the world and, as a result, we are exposed to movements in~~only major foreign currency exchange rates. To a large extent, our global manufacturing and sales provide a natural hedge of foreign currency exchange rate movement, as foreign currency expenses generally offset foreign currency revenues.exposure is to the Canadian dollar. We manage our Canadian cash flow exposures on a net ~~basis and use derivatives~~basis. We currently do not expect to ~~hedge the majority of our unmatched~~enter into any foreign currency cash inflows and outflows. Our major foreign currency exposures as of September 30, 2017, based on operating profits by currency, are to the Indian rupee, Russian ruble, Chinese renminbi and Canadian dollar.exchange derivative products.

We ~~use foreign currency forward exchange contracts~~utilize interest rate swaps to ~~reduce our exposure to~~minimize the ~~risk that the eventual net cash inflows and outflows resulting from the sale of products to foreign customers and purchases from foreign suppliers will be adversely affected~~fluctuations in earnings caused by ~~changes in exchange rates.~~interest rate volatility. These ~~derivative instruments~~swaps are ~~used for forecasted transactions and are classified~~designated as cash flow ~~hedges. Cash flow~~ hedges ~~are executed quarterly, generally up to 15 months forward, and allow us to further reduce~~against changes in LIBOR for a portion of our ~~overall exposure to exchange~~variable rate ~~movements, since gains and losses on these contracts offset gains and losses on the transactions being hedged.~~debt. The ~~notional amount of these hedges was $31.3 million~~following table summarizes our interest rate swaps as of ~~September 30, 2017 and $34.6 million as of December~~March 31, 2016. Gains and losses on these instruments are recorded in other comprehensive income, to the extent effective, until the underlying transaction is recognized in earnings. The earnings impact of the ineffective portion of these hedges was not material for the three and nine months ended September 30, 2017 and 2016. 2019:

We utilize interest rate swaps to minimize the fluctuations in earnings caused by interest rate volatility. Interest expense on variable-rate liabilities increases or decreases as a result of interest rate fluctuations. The following table summarizes our interest rate swaps as of September 30, 2017:

In connection with the refinancing of our credit facilities in April 2016, $450.0 million of notional amount Term Loan B swaps with a trade date of March 27, 2012 were settled and $10.7 million of losses recorded as a component of accumulated other comprehensive income were reclassified to interest expense during the three months ended March 31, 2016, with the cash payment for the settlement of this swap occurring during the second quarter of 2016.

Under the terms of the ~~Term Loan A~~November 2016 swap ~~with trade dates of~~maturing in 2021, we receive 3-month LIBOR and pay a fixed rate over the hedged period, in addition to a basis rate swap to convert the floating rate risk under our November ~~13,~~ 2016 Swap from 3-month LIBOR to 1-month LIBOR. As a result, we receive 1-month LIBOR and pay a fixed rate over the hedged period.

Under the terms of ~~our Term Loan B~~the April 2016 swap ~~with a trade date of April 1, 2016,~~maturing in 2023, we receive the greater of 3-month LIBOR or a 0.75% LIBOR Floor and pay a fixed rate over the hedged period. ~~These swaps are designated as cash flow hedges against changes in LIBOR for a portion of our variable rate debt. Gains and losses on these instruments are recorded in other comprehensive income, to~~

Under the extent effective, until the underlying transaction is recognized in earnings. The mark-to-market gains or losses on the ineffective portion of hedges are recognized in interest expense. There was no earnings impactterms of the ~~ineffective portion~~November 2018 swap maturing in 2023, we pay a fixed rate over the hedged amount and receive 1-month LIBOR. This is inclusive of ~~these hedges for~~a 0% floor.

Under the ~~three~~terms of the November 2018 swap maturing in 2025, we will pay a fixed rate monthly and ~~nine months ended September 30, 2017 and 2016.~~receive 1-month LIBOR. This is inclusive of a 0% floor.

The following tables detail amounts related to our derivatives as of ~~September 30, 2017~~March 31, 2019 and December 31, ~~2016.~~2018. We had no derivative assets or liabilities not designated as hedging instruments as of ~~September 30, 2017~~March 31, 2019 or December 31, ~~2016.~~2018. The derivative asset and liability amounts below are shown in gross amounts; we have not netted assets with liabilities.

As of March 31, 2019, the amount of existing losses in AOCI expected to be recognized in earnings over the next twelve months is $0.8 million.

~~As of September 30, 2017, the amount of existing losses in AOCI expected to be recognized in earnings over the next twelve months is $1.5 million.~~

~~There was no pre-tax gain or loss recognized in income for derivative instruments not designated as hedging instruments for the three months ended September 30, 2017 and 2016.~~

On July 29, 2016, we announced that our Board of Directors had approved a share repurchase program pursuant to which we ~~are~~were authorized to repurchase up to $150.0 million of our outstanding shares of common stock through July 31, 2018 (the “Program”). On October 30, 2017, we announced that our Board of Directors had approved an additional $250.0 million authorization to repurchase shares under the Program. The Program was also extended through October 31, 2020. On July 31, 2018, we announced that our Board of Directors had approved an additional $300.0 million authorization to repurchase shares, increasing the total authorized amount under the Program to $700.0 million.

Repurchases under the Program may be made through open market, block and privately-negotiated transactions, including Rule 10b5-1 plans, at such times and in such amounts as management deems appropriate, subject to market and business conditions, regulatory requirements and other factors. The Program does not obligate usAWI to repurchase any particular amount of common stock and may be suspended or discontinued at any time without notice.

On August 2, 2018, we entered into an accelerated share repurchase (“ASR”) agreement with Deutsche Bank AG under the Program. The ASR included a pre-payment of $150.0 million to Deutsche Bank, at which time we received 1,766,004 shares. The ASR terminated on October 8, 2018, with an additional 389,825 shares returned on that day to complete the ASR.

During the ~~nine~~three months ended ~~September 30, 2017,~~March 31, 2019, we repurchased ~~1.8~~0.3 million shares under the Program for a total cost of ~~$75.4~~$20.0 million, or an average price of ~~$42.81~~$60.30 per share. ~~During~~Since inception of the ~~nine months ended September 30, 2016,~~Program, through March 31, 2019, including the ASR, we have repurchased ~~0.2~~8.0 million shares under the Program for a total cost of ~~$7.8 million. Since inception of the Program, we have repurchased 2.9 million shares under the Program for a total cost of $119.2~~$450.6 million, or an average price of ~~$41.52~~$56.19 per share.

In February 2019, our Board of Directors ~~had approved an additional $250.0 million authorization~~declared a $0.175 per share quarterly dividend, which was paid to ~~repurchase shares of our outstanding common stock under the Program. The Program was also extended through October 31, 2020.~~

Foreign
Currency
Translation Adjustments

Derivative
Gain (Loss) ⁽¹⁾

Pension and Postretirement Adjustments⁽¹⁾

Total
Accumulated
Other
Comprehensive
(Loss)⁽¹⁾

Balance, December 31, 2015

$
(33.8
)

$
(3.3
)

$
(450.3
)

$
(487.4
)
Separation of AFI, net of tax (benefit) of $-, $-, ($37.8) and ($37.8)

(4.6
)

(0.4
)

61.8

56.8

Other comprehensive (loss) income before reclassifications,
net of tax expense (benefit) of $ -, $2.5, ($1.5), and $1.0

(13.8
)

(4.9
)

2.8

(15.9
)
Amounts reclassified from accumulated other
comprehensive (loss)

-

6.1

21.1

27.2

Net current period other comprehensive (loss) income

(13.8
)

1.2

23.9

11.3

Balance at September 30, 2016

$
(52.2
)

$
(2.5
)

$
(364.6
)

$
(419.3
)

	Amounts Reclassified from Accumulated Other Comprehensive (Loss) ⁽¹⁾						Affected Line Item in the Condensed Consolidated Statement of Earnings and Comprehensive Income
	Three Months Ended March 31,
	2019			2018
Derivative Adjustments:
Natural gas commodity contracts	$	-		$	0.4		Cost of goods sold
Foreign exchange contracts - purchases		-			0.1		Cost of goods sold
Foreign exchange contracts - sales		-			0.2		Net sales
Interest rate swap contracts		0.6			0.5		Interest expense
Total loss, before tax		0.6			1.2
Tax impact		(0.1	)		(0.3	)	Income tax expense
Total loss, net of tax		0.5			0.9

Pension and Postretirement Adjustments:
Amortization of net actuarial loss		2.7			3.6		Other non-operating (income), net
Total expense, before tax		2.7			3.6
Tax impact		(0.6	)		(0.8	)	Income tax expense
Total expense, net of tax		2.1			2.8
Total reclassifications for the period	$	2.6		$	3.7

Amounts
Reclassified from
Accumulated Other
Comprehensive
(Loss)

Affected Line Item in the
Condensed Consolidated
Statement of Earnings
and Comprehensive
Income

Nine Months Ended September 30,

2017

2016

Derivative Adjustments:

Natural gas commodity contracts

$
(0.3
)

$
1.2

Cost of goods sold
Foreign exchange contracts - purchases

0.1

(0.4
)

Cost of goods sold
Foreign exchange contracts - sales

(0.2
)

(1.2
)

Net sales
Interest rate swap contracts

-

10.7

Interest expense
Total (income) loss from continuing operations, before tax

(0.4
)

10.3

Tax impact

0.1

(3.6
)

Income tax expense
Total (income) loss from continuing operations, net of tax

(0.3
)

6.7

Total (income) from discontinued operations, net of tax benefit
of $ - and ($0.3)

-

(0.6
)

Total (income) loss, net of tax

(0.3
)

6.1

Pension and Postretirement Adjustments:

Prior service cost amortization

0.7

0.6

Cost of goods sold
Prior service cost amortization

0.4

0.4

SG&A expense
Amortization of net actuarial loss

5.4

17.1

Cost of goods sold
Amortization of net actuarial loss

5.7

11.4

SG&A expense
Partial settlement

12.5

-

Cost of goods sold
Partial settlement

8.3

-

SG&A expense
Total expense from continuing operations, before tax

33.0

29.5

Tax impact

(11.6
)

(11.3
)

Income tax expense
Total expense from continuing operations, net of tax

21.4

18.2

Total expense from discontinued operations, net of tax expense
of $ - and $1.5

-

2.9

Total expense, net of tax

21.4

21.1

Total reclassifications for the period

$
21.1

$
27.2

Our manufacturing and research facilities are affected by various federal, state and local requirements relating to the discharge of materials and the protection of the environment. We make expenditures necessary for compliance with applicable environmental

requirements at each of our operating facilities. These regulatory requirements continually change, therefore we cannot predict with certainty future expenditures associated with compliance with environmental requirements.

We are actively involved in the investigation, closure and/or remediation of existing or potential environmental contamination under the Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA”) and state Superfund and similar environmental laws at ~~several~~three domestically owned ~~formerly owned and non-owned~~ locations allegedly resulting from past industrial activity.

In ~~a few cases,~~each location, we are one of ~~several~~multiple potentially responsible parties and have agreed to jointly fund the required investigation and remediation, while preserving our defenses to the liability. We may also have rights of contribution or reimbursement from other parties or coverage under applicable insurance policies. We are currently pursuing coverage and recoveries under those policies with respect to certain of the sites, including the St. Helens, OR site, the Macon, GA site and the Elizabeth City, NC site, each of which is summarized below. These efforts include two active and independent litigation matters against legacy primary and excess policy insurance carriers for recovery of fees and costs incurred by us in connection with our investigation and remediation activities for such sites. Other than disclosed below, we are unable to predict the outcome of these matters or the timing of any recoveries, whether through settlement or otherwise. We are also unable to predict the extent to which any recoveries might cover our final share of investigation and remediation costs for these sites. Our final share of investigation and remediation costs may exceed any such recoveries, and such amounts net of insurance recoveries may be material. ~~During the second quarter of~~

In 2017 and 2018, we entered ~~into~~ settlement agreements totaling $37.5 million with ~~two~~certain legacy insurance carriers to resolve ongoing litigation and recover fees and costs previously incurred by us in connection with certain environmental sites. These settlements were ~~not material to our financial statements.~~

In September 2017, we entered into a $6.5 million settlement agreement with a legacy insurance carrier to resolve ongoing litigation and recover fees and costs previously incurred by us in connection with certain environmental sites. The $6.5 million settlement agreement was recorded as a ~~$5.0~~$9.2 million reduction to cost of goods sold and a ~~$1.5~~$28.3 million reduction to SG&A expenses ~~during the third quarter of 2017, which are~~reflecting the same income

statement categories where environmental expenditures were historically recorded. In October 2017, we entered into a $20.0 million settlement agreement with another legacy insurance carrier to resolve ongoing litigation and recover fees and costs previously incurred by us in connection with certain environmental sites. These settlement amounts exclude related legal costs and fees incurred by us in connection with the litigation. Outstanding settlement payments will beAll of these cash settlements have been released to us from escrow, ~~following court approval, which we expect to occur~~including $6.5 million received in ~~the fourth quarter of 2017 or~~ the first quarter of ~~2018.~~2019. In the first quarter of 2019, we entered into one new settlement agreement for $1.7 million and received an additional $0.2 million payment related to a previous settlement with a different carrier. These settlements were recorded as a $1.9 million reduction to SG&A expenses. We anticipate that we may enter into additional settlement agreements in the future, ~~that~~which may or may not be material, with other legacy insurers to obtain reimbursement or contribution for environmental site expenses.

Estimates of our future liability at the environmental sites are based on evaluations of currently available facts regarding each individual site. We consider factors such as our activities associated with the site, existing technology, presently enacted laws and regulations and prior company experience in remediating contaminated sites. Although current law imposes joint and several liability on all parties at Superfund sites, our contribution to the remediation of these sites is expected to be limited by the number of other companies potentially liable for site remediation. As a result, our estimated liability reflects only our expected share. In determining the probability of contribution, we consider the solvency of other parties, the site activities of other parties, whether liability is being disputed, the terms of any existing agreements and experience with similar matters, and the effect of our October 2006 Chapter 11 reorganization upon the validity of the ~~claim.~~claim, if any.

In August 2010, we entered into a Consent Order (the “Consent Order”) with the Oregon Department of Environmental Quality (“ODEQ”), along with Kaiser Gypsum Company, Inc. (“Kaiser”), and Owens Corning Sales LLC (“OC”), with respect to our St. Helens, OR facility, which was previously owned by Kaiser and then OC. The Consent Order ~~requires~~required that we and Kaiser complete a remedial investigation and feasibility study (“RI/FS”) on the portion of the site owned by us (“Owned Property”), which is comprised of Upland and Lowland areas. The Consent Order further ~~requires~~required us, Kaiser and OC to conduct an RI/FS in the ~~In-Water~~in-water area of the adjacent Scappoose Bay. Costs and responsibilities for investigation, including the current RI/FS, for the Owned Property have been shared with Kaiser pursuant to a cost sharing agreement with Kaiser. Costs and responsibilities for the investigation with respect to the in-water ~~areas~~area that we do not own have been shared with Kaiser and OC pursuant to a cost sharing agreement with Kaiser and OC.

On September 14, 2016, the parties submitted a Feasibility Study to the ODEQ proposing remedial action options for the Upland area. We have participated in the investigation phase for the Lowland area of the Owned Property and the Scappoose Bay and ~~have been working~~worked with the ODEQ, Kaiser and OC to finalize the reports to move to the ~~Feasibility Study~~feasibility study phase. We have determined that it is probable that remedial action for certain portions of the Lowland area of the Owned Property will be required. The current estimate of our future liability at the site includes any remaining known investigation work required by the Consent Order and the current projected cost of remedial actions in the Upland area. At this time, we are unable to reasonably estimate any remediation costs that we may ultimately incur with respect to the Lowland portion of the Owned Property or the Scappoose Bay or whether the projected costs for the areas we have included in our current estimate will increase. Additional investigative or remedial action required by the ODEQ could result in additional costs greater than the amounts currently estimated. As discussed above, we are currently unable to predict the outcome or the timing of our insurance recovery proceedings. Accordingly, additional estimated costs for this matter may be incurred without regard for, and prior to, the resolution of our insurance recovery proceedings.

On September 30, 2016, Kaiser filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the Western District of North Carolina (Case No. 16-31602) (the “Bankruptcy Court”). AWI, OC and the ODEQ have all been included on the master list of potential creditors filed with the Bankruptcy Court for notice purposes. By order dated October 14, 2016, the Bankruptcy Court formed a statutory committee of unsecured creditors, to which we were appointed to serve, along with OC and The Boeing Company. The Committee is charged with, among other things, maximizing recovery of all unsecured creditor claims, including claims of ~~Kaiser~~AWI and ODEQ. Noticed parties submitted claims to the Bankruptcy Court on September 13, 2017. The Chapter 11 case impacts Kaiser’s ongoing participation in the RI/FS process, as well as the ODEQ consent order and cost sharing agreements. It may also delay implementation of remedial actions for the Upland area, as well as completion of the investigation phase for the Lowland area of the Owned Property and the Scappoose Bay. At this time,

In November 2017, we ~~are unable to predict to what extent Kaiser intends to satisfy its environmental remediation obligations and liability to ODEQ. Kaiser has agreed to participate~~participated in voluntary mediation with ODEQ, OC and usKaiser to negotiate a ~~settlement~~resolution that would discharge Potentially Responsible Parties (“PRPs”) liability for the site. ~~We are unable~~As a result of the mediation, on February 1, 2018, ODEQ issued a Public Notice and a proposed consent judgment (“Consent Judgment”) recommending that, in exchange for a release from ODEQ for all contamination claims against AWI, we would pay $8.6 million to ~~predict~~ the ~~outcome~~State of ~~that mediation, or whether Kaiser has sufficient insurance or other assets to cover its anticipated share~~Oregon and perform a previously scoped remedial action for the Upland area. During the fourth quarter of ~~any site liability. Kaiser’s shares under cost sharing agreements were being funded~~2017, we increased our reserve for environmental liabilities by ~~certain insurance policies, which comprised substantially all of Kaiser’s assets. If Kaiser, whether~~$8.6 million as a result of this pending settlement with the State of Oregon.

On April 5, 2018, ODEQ issued Public Notice of the Remedial Action for the Upland area and subsequently responded to public comments. On June 26, 2018 ODEQ published its Record of Decision confirming the selected remedial action required for the Upland area. AWI will be responsible for performing the remedial action upon ODEQ’s filing of the Consent Judgment with the court, pending appeal. The Consent Judgment remains subject to entry and approval by the Columbia County Circuit Court. Kaiser continues to assert that the Consent Judgment violates the stay imposed by its bankruptcy case. The Bankruptcy Court, however, ruled in favor of ODEQ’s position that the Consent Judgment does not violate the stay. In response to that ruling, on October 3, 2018, Kaiser filed a motion for stay pending appeal. A decision on that motion remains pending.

Kaiser filed objections to the ODEQ proof of claim and AWI’s proof of claim and sought discovery related to the determination of costs incurred by the parties at the site. On November 26, 2018, Kaiser filed a complaint against AWI seeking monetary damages and declaratory relief including cost recovery and/or ~~otherwise, or OC are unwilling or unable~~contributions from AWI in connection with the environmental costs incurred by Kaiser at St. Helens. On March 1, 2019, we entered into a settlement agreement with Kaiser resolving all claims between us. In exchange for a payment of $1.0 million, Kaiser agreed to ~~fulfill their obligations under~~withdraw its appeal of the ~~cost sharing agreements, seek~~automatic stay imposed by the bankruptcy as it applies to ~~contest or challenge~~ the ~~allocations, if mediation~~Consent Judgment, dismiss its complaint against AWI, and refrain from filing any objections to the Consent Judgment once filed with the Columbia County Circuit Court. Our settlement with Kaiser is ~~unsuccessful, or if Kaiser’s insurance policies are unable~~conditioned on the effectiveness of a pending settlement between ODEQ and Kaiser, which we expect to ~~fund Kaiser’s share~~occur in the second quarter of ~~environmental liability, it could result in additional cost to us greater than the amounts currently estimated and those costs may be material.~~ 2019. The Bankruptcy Court approved our settlement with Kaiser on March 14, 2019.

The U.S. Environmental Protection Agency ~~(“EPA”~~(the “EPA”) has listed two landfills located on a portion of our ~~building products~~ facility in Macon, GA, along with the former Macon Naval Ordnance Plant landfill adjacent to our property, portions of Rocky Creek, and certain tributaries leading to Rocky Creek (collectively, the “Macon Site”) as a Superfund site on the National Priorities List due to the presence of contaminants, most notably polychlorinated biphenyls (“PCBs”).

In September 2010, we entered into an Administrative Order on Consent for a Removal Action with the EPA to investigate PCB contamination in one of the landfills on our property, the Wastewater Treatment Plant Landfill (the “WWTP Landfill,” also known as “Operable Unit 1”). ~~We concluded the investigative phase~~After completing an investigation of ~~the Removal Action for~~ the WWTP Landfill and ~~submitted~~submitting our final Engineering Evaluation/Cost Analysis, ~~(“EE/CA”) to~~ the EPA ~~in 2013. The EPA subsequently approved the EE/CA and~~ issued an Action Memorandum in July 2013 selecting our recommended remedy for the Removal Action. In July 2014, we entered into an Administrative Order on Consent for Removal Action with the EPA for the WWTP Landfill. The EPA approved the Removal Action Work Plan on March 30, 2015 and the removal work commenced in the third quarter of 2015. The Operable Unit 1 response action for the WWTP Landfill is complete and the final report was submitted to the EPA on October 11, 2016. The EPA approved the final report on November 28, 2016, and a Post-Removal Control Plan (the “Plan”) was submitted to the EPA on March 28, 2017. ~~We will implement the Plan once it is approved.~~ That Plan will monitor the effectiveness of the WWTP Landfill response action and our estimate of future liabilities includes these tasks.

It is probable that we will incur field investigation, engineering and oversight costs associated with a RI/FS with respect to the remainder of the Superfund site, which includes the other landfill on our property, as well as areas on and adjacent to AWI’s property and Rocky Creek (the “Remaining Site,” also known as “Operable Unit 2”). On September 25, 2015, AWI and other PRPs received a Special Notice Letter from the EPA under CERCLA inviting AWI and the PRPs to enter into the negotiation of ~~a Settlement Agreement (formerly known as~~ an ~~Administrative Order on Consent)~~agreement to conduct an RI/FS of Operable Unit 2. We ~~along with~~and the other PRPs ~~submitted~~entered into a ~~good faith offer to~~settlement agreement with the EPA effective September 18, 2018, in response to the Special Notice Letter to conduct the RI/FS. ~~We have not received~~The PRPs are required to submit a ~~response to our good faith offer and have not yet entered into an Order with~~complete RI/FS work plan in April 2019. While the ~~EPA for Operable Unit 2. We have not yet commenced an investigation of~~investigative work on this portion of the ~~site. We~~site has not yet commenced, we anticipate that the EPA will require significant investigative work for

Operable Unit 2 and that we may ultimately incur costs in remediating any contamination discovered during the RI/FS. The current estimate of future liability at this site includes only our estimated share of the costs of the investigative work that, at this time, we anticipate the EPA will require the PRPs to perform. We are unable to reasonably estimate AWI’s final share of the costs or the total costs associated with the investigation work or any resulting remediation therefrom, although such amounts may be material.

This site is a former cabinet manufacturing facility that was operated by Triangle Pacific Corporation, now known as Armstrong Wood Products, Inc. (“Triangle Pacific”), from 1977 until 1996. The site was formerly owned by the U.S. Navy (“Navy”) and Westinghouse, now CBS Corporation (“CBS”). We assumed ownership of the site when we acquired the stock of Triangle Pacific in 1998. Prior to our acquisition, the NC Department of Environment and Natural Resources listed the site as a hazardous waste site. In 1997, Triangle Pacific entered into a cost sharing agreement with Westinghouse whereby the parties agreed to share equally in costs associated with investigation and potential remediation. In 2000, Triangle Pacific and CBS entered into an Administrative Order on Consent to conduct an RI/FS with the EPA for the site. In 2007, we and CBS entered into an agreement with the Navy whereby the Navy agreed to pay one third of defined past and future investigative costs up to a certain amount, which has now been exhausted. The EPA approved the RI/FS work plan in August 2011. In January 2014, we submitted the draft Remedial Investigation and Risk Assessment reports and conducted supplemental investigative work based upon agency comments to those reports. The ~~parties have agreed upon tasks and timeframes to complete a feasibility study at~~EPA published an Interim Action Proposed Plan for the site ~~working toward a Proposed Plan~~in April 2018 seeking public comment through June 7, 2018. The EPA has evaluated comments, including ours, and has published its Interim Record Of Decision ~~in 2018. If remediation is required,~~selecting an interim cleanup approach. On September 25, 2018, AWI and CBS received a Special Notice Letter from the ~~related costs may be material, although~~EPA under CERCLA inviting AWI and CBS to enter into the negotiation of a settlement agreement to conduct or finance the response action at the site. During the third quarter of 2018, we increased our reserve for the cost of the interim cleanup, which we expect ~~these costs~~ to be shared with CBS and the Navy.

~~Liabilities~~Total liabilities of ~~$5.2~~$12.4 million as of ~~September 30, 2017~~March 31, 2019 and ~~$4.7 million as of~~ December 31, ~~2016~~2018 were recorded for environmental liabilities that we consider probable and for which a reasonable estimate of the probable liability could be made. As of March 31, 2019 and December 31, 2018, $9.6 million and $0.7 million were reflected within Accounts payable and accrued expenses with respect to environmental liabilities. During the three months ended ~~September 30, 2017,~~March 31, 2019, we recorded $1.0 million of additional reserves. During the three months ended March 31, 2018, we did not record any additional reserves for environmental liabilities. During the nine months ended September 30, 2017, we increased reserves for environmental liabilities by $1.3 million. During the three and nine months ended September 30, 2016, we recorded reserves for potential environmental liabilities of $2.0 million and $2.5 million, respectively. Where existing data is sufficient to estimate the liability, that estimate has been used; where only a range of probable liabilities is available and no amount within that range is more likely than any other, the lower end of the range has been used. As assessments and remediation activities progress at each site, these liabilities are reviewed to reflect new information as it becomes available, and adjusted to reflect amounts actually incurred and paid. These liabilities are undiscounted.

The estimated liabilities above do not take into account any claims for recoveries from insurance or third parties. It is our policy to record insurance recoveries when probable. For insurance recoveries that are reimbursements of prior environmental expenditures, the income statement impact is recorded within cost of goods sold and SG&A expenses, ~~and/or discontinued operations,~~ which are the same income statement categories where environmental expenditures were historically recorded. Insurance recoveries in excess of historical environmental spending, ~~if any, would be~~are recorded on the balance sheet as a part of other long-term liabilities and released as future environmental spending ~~occurs.~~occurs or the liability is settled.

The estimated liabilities above do not take into account any claims for recoveries from insurance or third parties. It is our policy to record recoveries as assets in the Condensed Consolidated Balance Sheets. As of March 31, 2019, we have $1.7 million of receivables for insurance recoveries reflected within Accounts and notes receivable, net.

Actual costs to be incurred at identified sites may vary from our estimates. Based on our knowledge of the identified sites, it is not possible to reasonably estimate future costs in excess of amounts already recognized.

On September 8, 2017, Roxul USA, Inc. (d/b/a Rockfon) (“Rockfon”) filed litigation against us in the United States District Court for the District of Delaware (the “Court”) alleging anticompetitive conduct seeking remedial measures and unspecified damages. Roxul USA, Inc. is a significant ceilings systems competitor with global headquarters in Europe and expanding operations in the Americas. ~~We believe~~On April 3, 2019, we entered into a confidential settlement agreement with Rockfon to fully resolve the litigation between us, and Rockfon filed a Stipulation of Dismissal with Prejudice (“Dismissal”) with the Court. Pursuant to the Dismissal, Rockfon formally dismissed all claims it had against AWI with prejudice. All claims in the litigation have been fully and finally dismissed and released with AWI making a payment to Rockfon for its costs, expenses and attorneys’ fees. Pursuant to the settlement, both parties acknowledged that (a) AWI denies all claims of wrongdoing and makes no admission of wrongdoing or of the truth of any of the claims or allegations contained in Rockfon’s complaint or otherwise alleged in the litigation; (b) all AWI exclusive distribution locations (i.e., any location where a reseller has agreed to sell only AWI ceiling system products) will remain exclusive to AWI under their respective distribution agreements, and (c) in all other non-exclusive or “open” distribution locations, resellers are ~~without merit~~free to purchase and ~~intend~~resell ceiling systems products of any manufacturer at their discretion. During the first quarter of 2019, we incurred $19.7 million of expenses in connection with the matter, primarily relating to ~~vigorously defend~~legal and professional fees incurred by us in connection with the litigation, including expenses and attorney’s fees paid under the settlement agreement. As a result of the settlement and Dismissal, we do not expect to incur additional future costs or expenses relating to the matter.

We are involved in other various lawsuits, claims, investigations and other legal matters from time to time that arise in the ordinary course of business, including matters involving our products, intellectual property, relationships with suppliers, relationships with distributors, relationships with competitors, employees and other matters. From time to time, for example, we may be a party to litigation matters that involve product liability, tort liability and other claims under various allegations, including illness due to exposure to certain chemicals used in the workplace; or medical conditions arising from exposure to product ingredients or the presence of trace contaminants. Such allegations may involve multiple defendants and relate to legacy products that we and other

defendants purportedly manufactured or sold. We believe that any current claims are without merit and intend to defend them vigorously. For these matters, we also may have rights of contribution or reimbursement from other parties or coverage under applicable insurance policies. When applicable and appropriate, we will pursue coverage and recoveries under those policies, but are unable to predict the outcome of those demands. While complete assurance cannot be given to the outcome of these proceedings, we do not believe that any current claims, individually or in the aggregate, will have a material adverse effect on our financial condition, liquidity or results of operations.

The following table is a reconciliation of earnings to earnings attributable to common shares used in our basic and diluted EPS calculations for the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2019 and ~~2016:~~2018:

	Three Months Ended						Nine Months Ended						Three Months Ended
	September 30,						September 30,						March 31,
	2017			2016			2017			2016			2019			2018
Earnings from continuing operations	$	43.5		$	55.9		$	115.8		$	65.4		$	36.4		$	41.2
Earnings allocated to participating non-vested share awards		(0.2	)		(0.2	)		(0.4	)		(0.2	)		(0.1	)		(0.1	)
Earnings from continuing operations attributable to common shares	$	43.3		$	55.7		$	115.4		$	65.2		$	36.3		$	41.1

The following table is a reconciliation of basic shares outstanding to diluted shares outstanding for the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2019 and ~~2016~~2018 (shares in millions):

	Three Months Ended				Nine Months Ended				Three Months Ended
	September 30,				September 30,				March 31,
	2017		2016		2017		2016		2019		2018
Basic shares outstanding		53.0		55.5		53.5		55.6		48.7		53.0
Dilutive effect of common stock equivalents		0.5		0.5		0.4		0.4		0.8		0.8
Diluted shares outstanding		53.5		56.0		53.9		56.0		49.5		53.8

Anti-dilutive stock ~~options~~awards excluded from the computation of diluted EPS for the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2019 were ~~246,468 and 426,410, respectively. Anti-dilutive~~30,371. There were no anti-dilutive stock ~~options~~awards excluded from the computation of diluted EPS for the three ~~and nine~~ months ended ~~September 30, 2016 were 468,281 and 690,715.~~

Management’s Discussion and Analysis of Financial Condition and Results of Operations

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This discussion should be read in conjunction with the financial statements, the accompanying notes, the cautionary note regarding forward-looking statements and risk factors included in this report and our Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2018.

We are a leading global producer of ceiling systems for use primarily in the construction and renovation of commercial, institutional and residential buildings. We design, manufacture and sell ceiling systems (primarily mineral fiber, fiberglass wool, metal and ~~metal) around~~wood) throughout the ~~world.~~Americas.

On April 1, 2016, we completed our separation of Armstrong Flooring, Inc. (“AFI”). Beginning in the second quarter of 2016, AFI’s historical financial results for periods prior to April 1, 2016 are reflected in our Condensed Consolidated Financial Statements as a discontinued operation.

~~On January 13, 2017,~~March 4, 2019, we acquired the business and assets of ~~Tectum,~~Architectural Components Group, Inc. (“~~Tectum”~~ACGI”) ~~for a total cash purchase price of $31.4 million. Tectum~~, based in Marshfield, Missouri. ACGI is a manufacturer of ~~acoustical ceiling, wall~~custom wood ceilings and ~~structural solutions for commercial building applications~~walls with ~~two~~one manufacturing ~~facilities.~~ ~~Tectum’s~~facility. ACGI’s operations, ~~from the date of acquisition,~~ and its assets and liabilities, ~~as of September 30, 2017, have been~~are included as a component of our ~~Americas~~Architectural Specialties segment.

WeIn August 2018, we acquired the business and assets of Steel Ceilings, Inc. (“Steel Ceilings”), based in Johnstown, Ohio. Steel Ceilings is a manufacturer of aluminum and stainless metal ceilings that include architectural, radiant and security solutions with one manufacturing facility. Steel Ceilings’ operations, and its assets and liabilities, are ~~focused on driving sustainable shareholder value creation. Our strategic priorities~~included as a component of our Architectural Specialties segment.

In May 2018, we acquired the business and assets of Plasterform, Inc. (“Plasterform”), based in Mississauga, Ontario, Canada. Plasterform is a manufacturer of architectural cast ceilings, walls, facades, columns and moldings with one manufacturing facility. Plasterform’s operations, and its assets and liabilities, are ~~to accelerate profitable volume growth globally and to improve the returns in~~included as a component of our ~~international business. Our primary goal is to expand into new, and grow in existing, markets by selling a broad array of products and solutions into those markets.~~Architectural Specialties segment.

~~As of September 30,~~On November 17, 2017, we ~~operated 16 manufacturing plants~~entered into a Share Purchase Agreement (the “Purchase Agreement”) with Knauf International GmbH (“Knauf”), to sell certain subsidiaries comprising our business in ~~eight countries, including eight plants located throughout~~Europe, the ~~U.S. Three of our plants are leased~~Middle East and Africa (including Russia) (“EMEA”) and the ~~remaining 13 are owned.~~

Pacific Rim, including the corresponding businesses and operations conducted by Worthington Armstrong Venture (“WAVE”), our joint venture with Worthington Industries, Inc. (“Worthington”) in which ~~we hold~~AWI holds a 50% ~~equity interest,~~interest. The Purchase Agreement provides that the consideration to be paid by Knauf in connection with the sale is $330.0 million in cash, inclusive of amounts due to WAVE, subject to certain adjustments as provided in the Purchase Agreement, including adjustments based on the economic impact of any required regulatory remedies and a working capital adjustment.

On July 18, 2018, we entered into an amendment to the Purchase Agreement, pursuant to which Knauf agreed to irrevocably and unconditionally pay AWI (i) $250 million on August 1, 2018, and (ii) $80 million on September 15, 2018, if, prior to such date (A) any competition condition has not been satisfied, or (B) the closing has not yet occurred. The amendment also provided for the reduction (from a maximum of $35 million to a maximum of $20 million) of potential adjustments to the purchase price consideration for the transaction based on the impact of remedies required to satisfy competition conditions. We received both the $250 million payment and the $80 million payment from Knauf in the third quarter of 2018. Following receipt of these payments, we remitted $70 million to WAVE in partial consideration of the purchase price payable in respect of the business and operations of WAVE under the transaction. WAVE subsequently paid each of AWI and Worthington a dividend of $35 million. We also recorded a $22.4 million payable to WAVE, which is reflected within Accounts Payable and Accrued Expenses. The total consideration payable by AWI to WAVE will be determined following closing in connection with the calculation of the adjustments contemplated by the Purchase Agreement.

The transaction was notified for merger control clearance in the European Union (“EU”), Bosnia and Herzegovina, Macedonia, Montenegro, Russia and Serbia, and was cleared unconditionally in Montenegro (February 2018), Serbia (February 2018), Russia (March 2018), Macedonia (July 2018) and Bosnia and Herzegovina (August 2018). On December 7, 2018, the European Commission granted conditional clearance of the transaction, subject to certain commitments intended to address concerns regarding the overlap between the activities of AWI and Knauf, including the divestment by Knauf to a third party of certain mineral fiber and grid businesses and operations in Austria, Estonia, Germany, Ireland, Italy, Latvia, Lithuania, Portugal, Spain, Turkey and the United Kingdom (“UK”). This includes our sales operations in each of the relevant countries, as well as our production facilities, and those of WAVE, located in Team Valley, UK. The terms of the sale of the divestment business by Knauf and the identity of the purchaser are subject to the approval of the European Commission.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

We continue to work closely with Knauf towards closing and expect the transaction to close during the second quarter of 2019. The EMEA and Pacific Rim segment historical financial results have been reflected in AWI’s Condensed Consolidated Financial Statements as discontinued operations for all periods presented.

See Note 4 to the Condensed Consolidated Financial Statements for additional information related to our acquisitions and discontinued operations.

As of March 31, 2019, we had 19 manufacturing plants in eight countries, including ten plants located within the U.S, which included our St. Helens, Oregon mineral fiber manufacturing facility, which closed in the second quarter of 2018. During the first quarter of 2019, as part of our acquisition of ACGI, we acquired one additional plant located in Missouri. We have one idle mineral fiber plant in China, reported as a component of our Unallocated Corporate segment as it is not included in the pending sale to Knauf. Upon closure of the sale of our EMEA and Pacific Rim businesses, we will have 13 plants, including ten plants in the U.S, two plants in Canada and the idle plant in China.

WAVE operates nine additional plants in five countries to produce suspension system (grid) products, ~~used~~which we use and sell in our ceiling systems. Upon closure of the sale of its corresponding EMEA and Pacific Rim businesses, WAVE will operate five plants in the U.S.

Our ~~reportable~~ operating segments ~~consist of the following three distinct geographical segments: Americas (including Canada); Europe, Middle East~~are as follows: Mineral Fiber, Architectural Specialties and ~~Africa (including Russia) (“EMEA”); and Pacific Rim.~~Unallocated Corporate.

~~Each of our geographical segments produce~~Mineral Fiber – produces suspended mineral fiber and ~~metal ceilings~~soft fiber ceiling systems for use in commercial and ~~institutional settings in addition to sourcing complimentary ceiling products.~~residential settings. Products offer various performance attributes such as acoustical control, rated fire protection and aesthetic appeal. Commercial ceiling ~~materials and accessories~~products are sold to resale distributors and to ceiling systems contractors. Residential ceiling products are sold ~~in the Americas~~ primarily to wholesalers and retailers (including large home centers). ~~Each~~The Mineral Fiber segment also includes ~~our~~the results of WAVE, ~~joint venture,~~ which manufactures suspension system (grid) products and ceiling component products that are invoiced by both usAWI and WAVE. ~~In each~~Segment results relating to WAVE consist primarily of equity earnings and reflect our ~~segments, WAVE primarily sells its suspension system~~50% equity interest in the joint venture. Ceiling component products ~~directly~~consist of ceiling perimeters and trim, in addition to ~~customers, for which we provide sales and administrative support.~~grid products that support drywall ceiling systems. To a lesser extent, however, in some markets, WAVE sells its suspension systems products to usAWI for resale to customers. ~~Our~~Mineral Fiber segment results reflect those sales transactions.

Architectural Specialties – produces and sources ceilings and walls for use in commercial settings. Products are available in numerous materials, such as metal and wood, in addition to various colors, shapes and designs. Products offer various performance attributes such as acoustical control, rated fire protection and aesthetic appeal. We sell standard and customized products, with the majority of Architectural Specialties revenues derived from sourced products. Architectural Specialties products are sold to resale distributors and ceiling systems contractors. The majority of revenues are project driven, which can lead to more volatile sales patterns due to project scheduling.

Unallocated Corporate ~~primarily include~~ – includes assets, liabilities, income and expenses that have not been allocated to our other business segments and consist of: cash and cash equivalents, ~~and~~the net funded status of our U.S. Retirement Income Plan (“RIP”), the estimated fair value of interest rate swap contracts, outstanding borrowings under our senior credit ~~facilities. The majority~~facilities and income tax balances. Our Unallocated Corporate segment also includes all assets, liabilities, income and expenses formerly reported in our EMEA and Pacific Rim segments that are not included in the pending sale to Knauf.

Management’s Discussion and Analysis of ~~expenses for~~Financial Condition and Results of Operations

For information on our ~~corporate support functions are allocated to our Americas segment.~~

~~See Note~~segments’ 2019 net sales, see Notes 2 and 3 to the Condensed Consolidated Financial Statements ~~for additional financial information on our consolidated company and our reportable segments.~~ included in this Form 10-Q.

Markets. We compete in building material markets ~~around the world, with the majority of our sales~~ in the Americas. We closely monitor publicly available macroeconomic trends that provide insight into commercial and residential market activity, including ~~Gross Domestic Product,~~GDP, office vacancy rates, the Architecture Billings Index, new commercial construction starts, state and local

~~Management’s Discussion and Analysis of Financial Condition and Results of Operations~~

In addition, we noted several factors and trends within our markets that ~~we believe~~ directly affected our business performance during the ~~third~~first quarter of ~~2017, including:~~ 2019 compared to the first quarter of 2018.

~~We believe~~In our Mineral Fiber segment, we experienced ~~growth from new construction while renovation~~lower volume activity, ~~moderated~~most notably due to softer demand for lower end products. In our Architectural Specialties segment, we experienced strong growth due to the ~~education sector. We experienced modest growth in the third quarter~~impact of ~~2017 in comparison to the third quarter of 2016, aided by the Tectum acquisition.~~

Market opportunities continue to be hindered by low global oil prices particularly in economies closely linked to oil, such as the Middle East. Activity improved in the third quarter from the third quarter of 2016, particularly in Russia.

~~Commercial office markets in China improved in comparison to the third quarter of 2016.~~

~~Consolidated~~recent acquisitions and increased market penetration and new construction activity.

Average Unit Value. We periodically modify sales prices ~~in each~~ of our ~~business segments~~products due to changes in costs for raw materials and energy, market conditions and the competitive environment. In certain cases, realized price increases are less than the announced price increases because of project pricing, competitive reactions and changing market conditions. Additionally, we offer a wide assortment of products that are differentiated by style, design and performance attributes. Pricing and margins for products within the assortment vary. In addition, changes in the relative quantity of products purchased at different price points can impact year-to-year comparisons of net sales and operating income. WeWithin our Mineral Fiber segment, we focus on improving sales dollars per unit sold, or average unit value (“AUV”), as a measure that accounts for the varying assortment of ~~prices,~~ products ~~and geographic mix~~ impacting our revenues. We estimate that favorable AUV increased our Mineral Fiber and total consolidated net sales infor the ~~third quarter and first nine~~three months ~~of 2017~~ended March 31, 2019 by $5approximately $19 million ~~and $22 million, respectively,~~ compared to the same ~~periods~~period in 2018. Our Architectural Specialties segment generates revenues that are generally earned based on individual contracts that include a mix of ~~2016.~~products, manufactured by us and sourced, that vary by project. As such, we do not track AUV performance for this segment, but rather attribute all changes in net sales to volume.

In the first quarter of ~~2017,~~2019, we implemented price increases on Mineral Fiber ceiling tile and grid ~~price increases in the Americas, EMEA and Pacific Rim. We also implemented a pricing increase for grid~~ products in the ~~Americas effective in the second quarter of 2017~~U.S. We also announced and implemented ~~a pricing increase for ceiling tile~~price increases on certain Architectural Specialties products in the ~~Americas and EMEA in the third~~first quarter of ~~2017.~~2019. We may implement additional pricing actions based on numerous factors, most notably upon future movements in raw material prices ~~or foreign currency valuations.~~and sourced product costs.

Seasonality. Generally, our sales tend to be stronger in the second and the third quarters of our fiscal year due to more favorable weather conditions, customer business cycles and the timing of renovation and new construction.

Operating Expenses. Our operating expenses are comprised of direct production costs (principally raw materials, labor and energy), manufacturing overhead costs, freight, costs to purchase sourced products and selling, general, and administrative (“SG&A”) expenses.

Our largest individual raw material expenditures are for fiberglass, perlite, starch, waste paper, steel, pigments and clays. We manufacture most of the production needs for mineral wool ~~perlite, starch and waste paper.~~at one of our manufacturing facilities. Natural gas and packaging materials are also significant input costs. Fluctuations in the prices of these inputs are generally beyond our control and have a direct impact on our financial results. In the ~~third quarter and~~ first ~~nine~~three months of ~~2017,~~2019, costs for raw materials, sourced products and energy negatively impacted operating income by $1 million ~~and $3 million, respectively,~~ compared to the same ~~periods~~period of ~~2016.~~2018.

As of ~~September 30, 2017,~~March 31, 2019 and December 31, 2018 we had approximately ~~3,900~~4,200 and 4,000 full-time and part-time employees, ~~worldwide compared to 3,700 full-time and part-time employees worldwide as of December 31, 2016.~~respectively. The increase ~~compared to December 31, 2016 was~~is primarily due to the ~~addition~~ACGI acquisition in March 2019. Excluding our EMEA and Pacific Rim businesses, we had approximately 2,400 and 2,200 employees as of ~~Tectum employees, partially offset by a reduction~~March 31, 2019 and December 31, 2018, respectively.

Management’s Discussion and Analysis of ~~employees related to the closure~~Financial Condition and Results of ~~one of our China plants.~~ Operations

Unless otherwise indicated, net sales in these results of continuing operations are reported based upon the AWI location where the sale was made. Please refer to Notes 2 and 34 to the Condensed Consolidated Financial Statements for a reconciliation of operating income to consolidated earnings from continuing operations before income taxes and additional financial information related to discontinued operations.

~~Management’s Discussion and Analysis of Financial Condition and Results of Operations~~

					Change is Favorable/				Three Months Ended March 31,
	2017		2016		(Unfavorable)				2019		2018		Change is Favorable
Three Months Ended September 30,
Total consolidated net sales	$	351.9	$	334.9		5.1		%	$	242.1	$	227.3		6.5	%
Operating income	$	69.0	$	71.0		(2.8	)	%	$	54.7	$	49.6		10.2	%

Nine Months Ended September 30,
Total consolidated net sales	$	998.1	$	936.6		6.6		%
Operating income	$	210.4	$	144.3		45.8		%

Excluding the favorable impact of foreign exchange of $5 million, consolidated net sales for the third quarter of 2017 increased 3.7% due to higher volumes of $8 million and favorable AUV of $5 million. Consolidated net sales for the first ~~nine months~~quarter of ~~2017~~2019 increased ~~6.6%~~6.5% over the same period in 2018 due to ~~higher volumes of $40 million and~~ favorable AUV of ~~$22~~$19 million, partially offset by lower volumes of $3 million. Mineral Fiber net sales increased by $6 million and Architectural Specialties net sales increased by $9 million.

Cost of goods sold in the ~~third~~first quarter of ~~2017~~2019 was ~~68.5%~~62.3% of net sales, compared to ~~67.2%~~68.9% for the same period in ~~2016,~~2018. The decrease in cost of goods sold as a percent of net sales for the first quarter of 2019 as compared to the same period in 2018 was primarily due ~~primarily~~ to ~~a $7~~$8 million ~~increase in the U.S. defined benefit plan expense resulting from a settlement loss~~of accelerated depreciation recorded in the ~~third~~first quarter of ~~2017 and a $4 million machinery and equipment accelerated depreciation charge recorded in the third quarter of 2017 due~~2018 related to management’s decision to permanently close the ~~previously idled~~St. Helens, Oregon plant in ~~China, partially offset by a $5 million reduction in cost~~addition to 2019 savings from the closure of ~~goods sold related to an environmental insurance settlement recorded in~~ the ~~third quarter of 2017. Cost of goods sold~~plant.

SG&A expenses in the first ~~nine months~~quarter of ~~2017 was 67.8%~~2019 were $55.6 million, or 23.0% of net sales, compared to 69.5% for the same period in 2016, due primarily to the environmental insurance settlement and a $5 million reduction in expense related to our U.S. pension plan, partially offset by the $4 million machinery and equipment accelerated depreciation charge.

~~SG&A expenses in the third quarter of 2017 were $55.8~~$37.5 million, or ~~15.9% of net sales, compared to $55.7 million, or 16.6%~~16.5% of net sales, for the same period in ~~2016.~~2018. The ~~change~~increase in SG&A expenses for the three months ended March 31, 2019 was primarily due to a $20 million increase in legal and professional fees, including expenses and attorney’s fees paid under the settlement agreement of a lawsuit filed against us alleging anticompetitive conduct by Roxul USA, Inc. (“Rockfon”). Also impacting the increase in SG&A expenses was ~~primarily due to a $4 million~~an increase in ~~the U.S. defined benefit plan expense resulting from a settlement loss recorded in the third quarter of 2017 and higher SG&A~~selling expenses, ~~as a result of the Tectum acquisition. These increases in SG&A expenses were~~ partially offset by a ~~$5 million reduction in expenses resulting from an increase in certain selling, promotional and administrative processing service reimbursements from WAVE and a~~ $2 ~~million reduction in expenses due to the environmental insurance settlement.~~

SG&A expenses in the first nine months of 2017 were $162.8 million, or 16.3% of net sales, compared to $165.2 million, or 17.6% of net sales, for the same period in 2016. The decrease in SG&A expenses was primarily due to the $5 million increase in ~~expense reimbursements from WAVE, a $3 million reduction in expense related to our defined benefit pension plans and a $2 million reduction due to the~~ environmental insurance ~~settlement. These decreases in SG&A~~settlements, net of expenses ~~were partially offset by higher SG&A expenses, most notably increases as a result of the Tectum acquisition and modest investments to enhance our total solutions selling capabilities.~~

Equity earnings from our WAVE joint venture were ~~$13.9 million for the third quarter of 2017, compared to $19.0 million in the third quarter of 2016. Equity earnings from our WAVE joint venture were $51.9~~$18.9 million for the first ~~nine months~~quarter of ~~2017,~~2019, compared to ~~$57.0~~$16.3 million in the first quarter of 2018. The increase in WAVE earnings was primarily related to increases in AUV, partially offset by lower volumes. See Note 8 to the Condensed Consolidated Financial Statements for further information.

Interest expense was $10.4 million for the ~~same period~~first quarter of 2019 compared to $9.2 million in ~~2016.~~the first quarter of 2018. The increase in the first quarter of 2019 was due to higher floating interest rates.

Other non-operating income, net was $5.5 million for the first quarter of 2019 compared to $9.0 million in the first quarter of 2018. The decrease in ~~WAVE earnings for both periods were~~other non-operating income, net was primarily ~~driven by an increase in selling~~related to lower credits from non-service cost components of pension and administrative processing charges from AWI and Worthington Industries, Inc. WAVE earnings for the third quarter of 2017 were also negatively impacted by higher input costs, particularly steel. For the first nine months of 2017, WAVE sales increased but were offset by higher input costs, particularly steel, and increased investments in selling expenses.postretirement net periodic benefit costs. See Note 714 to the Condensed Consolidated Financial Statements for further information.

~~Interest~~Income tax expense was ~~$9.1 million for the third quarter of 2017 compared to $9.0 million in the third quarter of 2016. Interest expense was $27.5~~$13.4 million for the first ~~nine months~~quarter of ~~2017~~2019 compared to ~~$43.4~~$8.2 million in the first nine months of 2016. Interest expense for the first nine months of 2016 included higher debt financing costs as a result of the refinancing of our credit facilities in April 2016 and $10.7 million of losses that were reclassified from accumulated other comprehensive income as a result of the settlement of $450.0 million of notional amount interest rate swaps which occurred in connection with the April 2016 refinancing of our credit facilities.

Other non-operating expense was $1.7 million and $ 3.6 million in the third quarter and first nine months of 2017, respectively. Other non-operating income was $3.0 million and $7.4 million in the third quarter and first nine months of 2017, respectively. Other non-operating income was $1.6 million and $8.9 million in the third quarter and first nine months of 2016, respectively. The changes in

~~Management’s Discussion and Analysis of Financial Condition and Results of Operations~~

~~other non-operating income and expense were primarily due to foreign exchange gains and losses on the translation of unhedged cross-currency intercompany loans.~~

~~Income tax expense was $17.7 million for the third~~ quarter of 2017 compared to income tax expense of $7.7 million in the third quarter of 2016. The effective tax rate for the third quarter of 2017 was 28.9% as compared to a rate of 12.1% for the same period of 2016. Income tax expense was $70.9 million for the first nine months of 2017 compared to $44.4 million in the first nine months of 2016.2018. The effective tax rate for the first ~~nine months~~quarter of ~~2017~~2019 was ~~38.0%~~26.8% as compared to a rate of ~~40.4%~~16.6% for the same period of ~~2016.~~2018. The effective tax rate ~~for the third quarter of 2017~~ was higher ~~compared to the same period in 2016 as income tax benefits resulting from the reversal of reserves for uncertain tax positions~~primarily due to the ~~expiration~~favorable impact of ~~the federal statute~~share-based compensation deductions resulting from exercise of ~~limitations were less~~options in the ~~third~~first quarter of ~~2017 compared to the same period of 2016.~~2018 versus 2019.

Total ~~other comprehensive income~~Other Comprehensive Income (“OCI”) was ~~$21.0 million in the third quarter of 2017 compared to $6.6 million for the third quarter of 2016. Total OCI was $37.7~~$3.0 million in the first ~~nine months~~quarter of ~~2017~~2019 compared to ~~$11.3~~$11.5 million for the first ~~nine months~~quarter of ~~2016. Foreign currency translation adjustments represent the~~2018. The change in ~~the U.S. dollar value of assets and liabilities denominated in foreign currencies. Amounts in the third quarter and first nine months of 2017 were driven~~OCI was primarily by changes in the exchange rates of the British pound, the Canadian dollar, the Chinese renminbi and the Russian ruble. Amounts in the third quarter and first nine months of 2016 were driven primarily by changes in the exchange rates of the British pound, the Chinese renminbi, the Australian dollar and the Euro.due to derivative gains/losses. Derivative gain/loss represents the mark-to-market value adjustments of our derivative assets and liabilities and the recognition of gains and losses previously deferred in OCI. Partially impacting the change in OCI was foreign currency translation adjustments and pension and postretirement adjustments. Foreign currency translation adjustments represent the change in the U.S. dollar value of assets and liabilities denominated in foreign currencies. Amounts in the first quarter of 2019 and 2018 were driven primarily by changes in the exchange rates of the Russian ruble and the British pound. Pension and postretirement adjustments represent the amortization of actuarial gains and losses ~~and settlement losses~~ related to our defined benefit pension and postretirement plans. The amounts in all periods primarily related to the amortization of losses on the U.S. pension plans. Amounts in the third quarter and first nine months of 2017 were also impacted by $20.8 million of settlement charges on the U.S. pension plan.

Excluding the favorable impact of foreign exchange of $1 million, net sales in the Americas for the third quarter of 2017 increased 3.2%, driven by favorable AUV of $9 million, partially offset by lower volumes of $2 million. Excluding the favorable impact of foreign exchange of $1 million, net sales in the Americas for the first nine months of 2017 increased 5.9% due to favorable AUV of $25 million and higher volumes of $12 million.

Operating income decreased in the third quarter of 2017, due primarily to an $11 million increase in pension expense as a result of a settlement loss recorded in the third quarter of 2017, a $3 million reduction in WAVE equity earnings, a $2 million increase in manufacturing and input costs, the negative impact from lower volumes of $2 million and increases in SG&A expenses as a result of the Tectum acquisition, partially offset by a $7 million environmental insurance settlement, a $5 million reduction in expenses resulting from an increase in certain selling, promotional and administrative processing service reimbursements from WAVE and favorable AUV of $6 million.

Operating income increased in the first nine months of 2017 due to the impact of favorable AUV of $15 million, higher volumes of $8 million, an $8 million reduction in pension expense, a $7 million environmental insurance settlement and a $5 million reduction in expenses resulting from an increase in certain selling, promotional and administrative processing service reimbursements from WAVE. These increases in operating income were partially offset by increases in SG&A expenses as a result of the Tectum acquisition and modest investments to enhance our total solutions selling capabilities, a $3 million increase in manufacturing and input costs and a $3 million reduction in WAVE equity earnings.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

							Change is Favorable/				Three Months Ended March 31,
	2017			2016			(Unfavorable)				2019		2018		Change is Favorable
Three Months Ended September 30,
Total segment net sales	$	76.5		$	74.2			3.1		%	$	196.7	$	190.7		3.1	%
Operating income	$	3.8		$	4.1			(7.3	)	%	$	47.6	$	43.7		8.9	%

Nine Months Ended September 30,
Total segment net sales	$	211.8		$	199.4			6.2		%
Operating (loss)	$	(1.1	)	$	(5.2	)		78.8		%

~~Excluding~~Net sales increased in the ~~favorable impact of foreign exchange of $3 million, net sales in EMEA for the third~~first quarter of ~~2017 decreased 0.9%~~2019 due to ~~unfavorable~~favorable AUV of ~~$1 million. Excluding the unfavorable impact of foreign exchange of $2~~$19 million, ~~net sales in EMEA for the first nine months of 2017 increased 6.9% due to higher~~partially offset by lower volumes of $12 ~~million and~~million. Favorable AUV for the three months ended March 31, 2019 as compared to 2018 was primarily due to favorable ~~AUV of $2 million.~~price, while the decrease in volume was primarily in lower end ceiling tile products.

Operating income ~~for~~increased in the ~~third~~first quarter of ~~2017~~2019 due to $15 million of favorable AUV and an $11 million benefit due to 2019 savings from the closure of our St. Helens manufacturing plant during the second quarter of 2018 combined with the absence of accelerated depreciation attributable to the plant that was ~~impacted by~~recorded in the first quarter of 2018. Also contributing to the increase in operating income was a $2$3 million ~~reduction~~increase in WAVE equity earnings partially offset by the positive impact of higher volumes of $2 million. Operating (loss) for the first nine months of 2017 decreased as higher volumes of $6 million and favorable AUV of $3 million more than offset higher SG&A expenses of $3 million and a $1$2 million ~~reduction~~increase in ~~WAVE equity earnings.~~environmental insurance settlements, net of expenses. Partially offsetting these decreases was a $20 million increase in costs associated with the aforementioned Rockfon lawsuit and a $7 million negative impact from lower volumes.

~~Excluding~~Net sales for the ~~favorable~~first quarter of 2019 increased due to the acquisitions of Plasterform, Steel Ceilings and ACGI and higher volumes from increased market penetration and new construction activity.

Operating income for the first quarter of 2019 increased due to the positive impact of ~~foreign exchange of $1 million, net~~higher sales ~~in the Pacific Rim for the third quarter of 2017 increased 16.7% due to higher volumes of $10 million,~~volume, partially offset by ~~unfavorable AUV of $4 million. Net sales across the various geographic markets improved, driven by China~~an increase in expenses from recent acquisitions and ~~Australia. Excluding the favorable impact of foreign exchange of $1 million, net sales~~additional investments in ~~the Pacific Rim for the first nine months of 2017 increased 10.2% due to higher volumes of $16 million, partially offset by lower AUV of $5 million.~~

~~Operating (loss) increased for the third quarter of 2017 due to a $4 million machinery~~selling and equipment accelerated depreciation charge recorded in the third quarter of 2017 due to management’s decision to permanently close the previously idled plant in China along with an unfavorable impact of $2 million for AUV, which was partially offset by the impact of higher volumes of $3 million.

Operating (loss) increased for the first nine months of 2017 due to the $4 million machinery and equipment accelerated depreciation charge along with an unfavorable impact of $2 million for AUV, partially offset by the impact of higher volumes of $5 million.design capacities.

Unallocated corporate expenses were ~~$3 million and $37~~$2.1 million for the ~~third~~first quarter ~~and~~of 2019 compared to $2.4 million in the first ~~nine~~quarter of 2018. The decline was primarily due to lower service cost associated with our RIP.

The discussion that follows includes cash flows related to discontinued operations.

Operating activities in the first three months of ~~2016, respectively,~~2019 provided $14.7 million of cash, compared to $26.0 million in the first three months of 2018. The decrease was primarily due to ~~charges incurred~~changes in ~~connection with our separation~~working capital, most notably a decrease in receipts of ~~AFI.~~ environmental insurance settlements in the first quarter of 2019 as compared to the same period in 2018.

29Net cash used for investing activities was $38.0 million for the first three months of 2019, compared to $5.8 million provided by investing activities for the first three months of 2018. The decrease resulted primarily from the acquisition of ACGI.

Net cash used for financing activities was $29.9 million for the first three months of 2019, compared to $64.2 million used during the first three months of 2018. The favorable change in use of cash was primarily due to lower repurchases of outstanding common stock, offset by the payment of dividends and lower proceeds from exercised employee stock awards.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Operating activities in the first nine months of 2017 provided $104.9 million of cash, compared to $2.6 million used in the first nine months of 2016. The increase in cash resulted primarily from higher cash earnings and changes in working capital, most notably accounts payable and accrued expenses, primarily a result of the separation of AFI.

Net cash used for investing activities was $41.3 million for the first nine months of 2017, compared to $6.9 million used for the first nine months of 2016. The increase in cash used resulted primarily from the Tectum acquisition and lower dividends from our WAVE joint venture, partially offset by lower purchases of fixed assets.

Net cash used for financing activities was $92.2 million for the first nine months of 2017, compared to $88.2 million used during the first nine months of 2016. The cash used during the first nine months of 2017 was primarily from the repurchase of outstanding common stock and payments of long-term debt. The cash used during the first nine months of 2016 was primarily the result of the refinance of our credit facilities in April 2016.

Our liquidity needs for operations vary throughout the year. We retain lines of credit to facilitate our seasonal cash flow needs, since cash flow is generally lower during the first and fourth quarters of our fiscal year. We have a $1,050.0 million variable rate senior credit facility which is comprised of a $200.0 million revolving credit facility (with a $150.0 million sublimit for letters of credit), a $600.0 million Term Loan A and a $250.0 million Term Loan B. ~~We also have a $25.0 million letter of credit facility, also known as our bi-lateral facility. As of September 30, 2017, we had no borrowings outstanding on the revolving credit facility.~~ The $1,050.0 million senior credit facility is secured by U.S. personal property, the capital stock of material U.S. subsidiaries and a pledge of 65% of the stock of our material first tier foreign subsidiaries. The unpaid balances of Term Loan A, the revolving credit facility and Term Loan B may be prepaid without penalty at the maturity of their respective interest reset periods. Any amounts prepaid on the Term Loan A or Term Loan B may not be re-borrowed. As of March 31, 2019, total borrowings outstanding under our senior credit facility were $540.0 million under Term Loan A and $242.5 million under Term Loan B. There were no borrowings outstanding under the revolving credit facility as of March 31, 2019.

Under our senior credit facility, we are subject to year-end leverage tests that may trigger mandatory prepayments. If our ratio of consolidated funded indebtedness, minus AWI and domestic subsidiary unrestricted cash and cash equivalents up to $100 million, to consolidated earnings before interest, taxes, depreciation and amortization (“EBITDA”) (“Consolidated Net Leverage Ratio”) is greater than 3.5 to 1.0, the prepayment amount would be based on a computation of 50% of ~~fiscal year~~ Consolidated Excess Cash ~~Flow.~~Flow, as defined by the credit agreement. These annual payments would be made in the first quarter of the following year. No payment was ~~required during~~made in the first quarter of ~~2017 under the~~2019.

~~The refinanced senior credit facilities include~~facility includes two financial covenants that require the ratio of consolidated EBITDA to consolidated cash interest expense minus cash consolidated interest income to be greater than or equal to 3.0 to 1.0 and requires the Consolidated Net Leverage Ratio to be less than or equal to 3.75 to ~~1.0 as of April 1st each year.~~1.0. As of ~~September 30, 2017,~~March 31, 2019, we were in compliance with all covenants of the senior credit facility.

~~In February 2017, we repriced the interest rate on our~~The Term Loan A and Term Loan B ~~borrowing, resulting in~~were both fully drawn and are currently priced on a lower LIBOR spread (2.75% vs. 3.25%). The maturity date and all other terms and conditions remained unchanged. In connection with the refinancing, we paid $0.6 million of bank, legal and other fees, the majority of which were capitalized.

variable interest rate basis. The following table summarizes our interest rate swaps ~~as of September 30, 2017~~ (dollar amounts in millions):

Trade Date

Notional

Amount

Coverage Period

Risk Coverage

Notional

Amount

Coverage Period

Risk Coverage

November 13, 2016

250.0

November 2016 to March 2018

Term Loan A

200.0

November 2016 to March 2021

USD-LIBOR

November 13, 2016

200.0

November 2016 to March 2021

Term Loan A

April 1, 2016

100.0

April 2016 to March 2023

Term Loan B

100.0

April 2016 to March 2023

USD-LIBOR

November 28, 2018

200.0

November 2018 to November 2023

USD-LIBOR

November 28, 2018

100.0

March 2021 to March 2025

USD-LIBOR

In connection with our credit facility refinancing, $450.0 million of notional amount Term Loan B swaps with a trade date of March 27, 2012 were settled and $10.7 million of losses recorded as a component of accumulated other comprehensive income were reclassified to interest expense during the first quarter of 2016, with the cash payment for the settlement of this swap occurring during the second quarter of 2016.

Under the terms of the ~~Term Loan A swaps with~~November 2016 swap maturing in 2021, we receive 3-month LIBOR and pay a ~~trade dates of~~fixed rate over the hedged period, in addition to a basis rate swap to convert the floating rate risk under our November ~~13,~~ 2016 swap from 3-month LIBOR to 1-month LIBOR. As a result, we receive 1-month LIBOR and pay a fixed rate over the hedged period.

~~Management’s Discussion and Analysis of Financial Condition and Results of Operations~~

Under the terms of the November 2018 swap maturing in 2023, we pay a fixed rate over the hedged amount and receive a 1-month LIBOR. This is inclusive of a 0% floor.

Under the terms of the November 2018 swap maturing in 2025, we will pay a fixed rate monthly and receive 1-month LIBOR. This is inclusive of a 0% floor.

These swaps are designated as cash flow hedges against changes in LIBOR for a portion of our variable rate debt. The unpaid balances of the Term Loan A, the revolving credit facility and the Term Loan B of the credit facility may be prepaid without penalty at the maturity of their respective interest reset periods. Any amounts prepaid on the Term Loan A or Term Loan B may not be re-borrowed.

Our foreign subsidiaries had available lines of credit totaling $4.8 million as of September 30, 2017. These lines of credit are uncommitted, and poor operating results or credit concerns at the related foreign subsidiaries could result in the lines being withdrawn by the lenders. We have historically been able to maintain and, as needed, replace credit facilities to support our non-U.S. operations. As of September 30, 2017, we had no borrowings under these lines of credit.

As of ~~September 30, 2017,~~March 31, 2019 our outstanding long-term debt also included a $35.0 million variable rate, tax-exempt industrial development bond that financed the construction of a plant in prior years. This bond has a scheduled final maturity of 2041 and is remarketed by an agent on a regular basis at a market-clearing interest rate. Any portion of the bond that is not successfully remarketed by the agent is required to be repurchased. This bond is backed by letters of credit, which will be drawn if a portion of the bond is not successfully remarketed. We have not had to repurchase any portion of the bond.

As of March 31, 2019, we had ~~$116.5~~$273.8 million of cash and cash equivalents, ~~$79.5~~$226.3 million in the U.S and $47.5 million in various foreign ~~jurisdictions~~jurisdictions. In connection with the sale of our EMEA and ~~$37.0 million~~Pacific Rim businesses, we intend to repatriate, or receive consideration from Knauf for, substantially all cash held in the ~~U.S.~~divested entities. Pursuant to our agreement with Knauf, Knauf will

Management’s Discussion and Analysis of Financial Condition and Results of Operations

reimburse us for any cash balances in the divested entities, subject only to a cumulative $10 million limit for certain specific countries. See Note 1 to the Condensed Consolidated Financial Statements for additional information.

As of March ~~2016,~~31, 2019, we ~~amended and decreased our $100.0~~had a $36.2 million Accounts Receivable Securitization Facility ~~to $40.0 million to reflect a lower anticipated receivables balance in connection~~ with the ~~separation~~Bank of ~~AFI,~~Nova Scotia (the “funding entity”) that matures in March 2020. Under our Accounts Receivable Securitization Facility we sell accounts receivables to Armstrong Receivables Company, LLC (“ARC”), a Delaware entity that is consolidated in these financial statements. ARC is a 100% wholly owned single member LLC special purpose entity created specifically for this transaction; therefore, any receivables sold to ARC are not available to the general creditors of AWI. ARC then sells an undivided interest in the purchased accounts receivables to the funding entity. This undivided interest acts as collateral for drawings on the facility. Any borrowings under this facility are obligations of ARC and ~~we extended~~not AWI. ARC contracts with and pays a servicing fee to AWI to manage, collect and service the ~~maturity date to March 2019.~~purchased accounts receivables. All new receivables under the program are continuously purchased by ARC with the proceeds from collections of receivables previously purchased. As of ~~September 30, 2017, there were~~March 31, 2019, we had no ~~outstanding~~ borrowings ~~on the accounts receivable securitization~~under this facility.

We utilize lines of credit and other commercial commitments in order to ensure that adequate funds are available to meet operating requirements. Letters of credit are currently arranged through our revolving credit facility, our bi-lateral facility and our securitization facility. ~~In addition, our foreign subsidiaries’ available lines of credit are available for letters of credit and guarantees.~~ Letters of credit ~~are~~may be issued to third party suppliers, insurance and financial institutions and typically can only be drawn upon in the event of AWI’s failure to pay its obligations to the beneficiary. The following table presents details related to our letters of credit (dollar amounts in millions):

	As of September 30, 2017							As of March 31, 2019
Financing Arrangements	Limit		Used		Available			Limit		Used		Available
Accounts receivable securitization facility	$	33.7	$	36.2	$	(2.5	)	$	31.9	$	36.2	$	(4.3	)
Bi-lateral facility		25.0		17.1		7.9			25.0		13.4		11.6
Revolving credit facility		150.0		-		150.0			150.0		-		150.0
Foreign lines of credit		0.2		-		0.2
Total	$	208.9	$	53.3	$	155.6		$	206.9	$	49.6	$	157.3

As of September 30, 2017, $2.5 million of letters of credit issued under our accounts receivable securitization facility in excess of our maximum limit were classified as restricted cash and reported as a component of Cash and cash equivalents on our Condensed Consolidated Balance Sheets. This restriction will lapse upon replacement of collateral with accounts receivable balances and/or upon a change in the letter of credit limit as a result of higher securitized accounts receivable balances.

We believe that cash on hand and cash generated from operations, together with lines of credit, availability under our securitization facility and the availability under our revolving credit facility, will be adequate to address our foreseeable liquidity needs based on current expectations of our business operations, capital expenditures and scheduled payments of debt obligations.

Information related to our contractual obligations at December 31, ~~2016~~2018 can be found in our ~~2016~~2018 Annual Report on Form 10-K, Part II, Item 7.7 - Management's Discussion and Analysis of Financial Condition and Results of Operations.

ITEM 3. ~~QUANTITATIV~~EQUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

For information regarding our exposure to certain market risks, see Item 7A, “Quantitative and Qualitative Disclosures About Market Risk,” in our ~~2016~~2018 Annual Report on Form 10-K. ~~There have been no material changes in our use of financial instruments to hedge against market risks or market risk exposures since December 31, 2016.~~

See Note 1820 to the Condensed Consolidated Financial Statements, which is incorporated herein by reference.

There have been no other material changes to the risk factors disclosed in our ~~2016~~2018 Annual Report on Form 10-K.

On August 2, 2018, we entered into an accelerated share repurchase agreement (“ASR”) with Deutsche Bank AG under the Program. The ASR included a pre-payment of $150.0 million to Deutsche Bank, at which time we received 1,766,004 shares. The ASR terminated on October 8, 2018, with approximately 389,825 shares returned on that day to complete the ASR.

During the ~~first nine~~three months ~~of 2017,~~ended March 31, 2019, we repurchased ~~1.8~~0.3 million shares under the Program for a total cost of ~~$75.4~~$20.0 million, or an average price of ~~$42.81~~$60.30 per share. Since inception of the Program, through March 31, 2019, including the ASR, we have repurchased ~~2.9~~8.0 million shares under the Program for a total cost of ~~$119.2~~$450.6 million, or an average price of ~~$41.52~~$56.19 per share.

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

Pennsylvania		23-0366390
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

2500 Columbia Avenue, Lancaster, Pennsylvania		17603
(Address of principal executive offices)		(Zip Code)

		PAGE
Cautionary Note Regarding Forward-Looking Statements		3

PART I - FINANCIAL INFORMATION
Item 1.	Financial Statements	4
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2528
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	3235
Item 4.	Controls and Procedures	3235

PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	3336
Item 1A.	Risk Factors	3336
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	3336
Item 3.	Defaults Upon Senior Securities	3336
Item 4.	Mine Safety Disclosures	3336
Item 5.	Other Information	3336
Item 6.	Exhibits	3437
Signatures		3538

	Three Months Ended March 31, 2019
Operating lease cost	$	1.6
Non-cash activity:
ROU assets obtained in exchange for lease obligations	29.2

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

	Three months ended March 31,
Mineral Fiber	2019		2018
Distributors	$	144.6	$	137.7
Home centers		23.1		24.0
Direct customers		14.1		13.7
Retailers and other		14.9		15.3
Total	$	196.7	$	190.7

	EMEA and Pacific Rim Businesses
Three months ended March 31, 2019:
Net sales	$	96.9
Cost of goods sold		75.7
Gross profit		21.2
Selling, general and administrative expenses		20.8
Operating income		0.4
Earnings from discontinued operations before income tax		0.4
Income tax (benefit)		(0.1	)
Net earnings from discontinued operations, net of tax	$	0.5

Gain from disposal of discontinued businesses, before income tax	$	2.2
Income tax expense		-
Gain from disposal of discontinued businesses, net of tax	$	2.2

Net earnings from discontinued operations	$	2.7

	EMEA and Pacific Rim Businesses			Flooring Businesses			Total
Three months ended March 31, 2018:
Net sales	$	104.4		$	-		$	104.4
Cost of goods sold		77.8			-			77.8
Gross profit		26.6			-			26.6
Selling, general and administrative expenses		22.0			-			22.0
Operating income		4.6			-			4.6
Interest expense		0.4			-			0.4
Other non-operating (income), net		(1.2	)		-			(1.2	)
Earnings from discontinued operations before income tax		5.4			-			5.4
Income tax expense		1.5			-			1.5
Net earnings from discontinued operations, net of tax	$	3.9		$	-		$	3.9

Loss from disposal of discontinued businesses, before income tax	$	(17.7	)	$	-		$	(17.7	)
Income tax (benefit)		-			(0.4	)		(0.4	)
Loss from disposal of discontinued business, net of tax	$	(17.7	)	$	0.4		$	(17.3	)

Net loss from discontinued operations	$	(13.8	)	$	0.4		$	(13.4	)

	March 31, 2019
Weighted average remaining lease term (in years)	7.9
Weighted average discount rate		5.0	%

	Maturities of Lease Liabilities
2019 ⁽¹⁾	$	4.9
2020		6.1
2021		5.0
2022		4.0
2023		3.5
Thereafter		12.0
Total lease payments		35.5
Less interest		(6.7	)
Present value of lease liabilities	$	28.8

	Total Minimum Lease payments
2019		5.3
2020		4.7
2021		4.2
2022		3.7
2023		2.2
Thereafter		4.7
Total		24.8

	September 30, 2017						December 31, 2016
	Fair value based on						Fair value based on
	Quoted, active markets			Other observable inputs			Quoted, active markets		Other observable inputs
	Level 1			Level 2			Level 1		Level 2
Assets/(Liabilities), net:
Foreign currency contracts	$	(1.0	)	$	-		$	1.6	$	-
Natural gas contracts		-			(0.2	)		-		1.0
Interest rate swap contracts		-			6.7			-		6.9

Trade Date	Notional Amount		Coverage Period	Risk Coverage
November 13, 2016	$	200.0	November 2016 to March 2021	USD-LIBOR
April 1, 2016	$	100.0	April 2016 to March 2023	USD-LIBOR
November 28, 2018	$	200.0	November 2018 to November 2023	USD-LIBOR
November 28, 2018	$	100.0	March 2021 to March 2025	USD-LIBOR

	Derivative Assets					Derivative Liabilities
		Fair Value					Fair Value
	Balance Sheet Location	September 30, 2017		December 31, 2016		Balance Sheet Location	September 30, 2017		December 31, 2016
Derivatives designated as hedging instruments
Natural gas commodity contracts	Other current assets	$	0.1	$	1.0	Accounts payable and accrued expenses	$	0.3	$	-
Foreign exchange contracts	Other current assets		0.1		1.4	Accounts payable and accrued expenses		1.1		-
Interest rate swap contracts	Other current assets		0.2		-	Accounts payable and accrued expenses		-		-
Foreign exchange contracts	Other non-current assets		-		0.2	Other long-term liabilities		0.1		-
Interest rate swap contracts	Other non-current assets		6.5		7.4	Other long-term liabilities		-		0.5
Total derivatives designated as hedging instruments		$	6.9	$	10.0		$	1.5	$	0.5

	Amount of Gain (Loss) Recognized in AOCI					Location of (Loss) Reclassified from AOCI into Income	(Loss) Reclassified from AOCI into Income
	Three Months Ended						Three Months Ended
	March 31,						March 31,
	2019			2018			2019			2018
Derivatives in cash flow hedging relationships
Natural gas commodity contracts	$	-		$	-	Cost of goods sold	$	-		$	(0.4	)
Foreign exchange contracts – purchases		-			0.1	Cost of goods sold		-			-
Foreign exchange contracts – sales		-			0.3	Net sales		-			(0.2	)
Interest rate swap contracts		(7.4	)		3.3	Interest expense		(0.6	)		(0.5	)
Total	$	(7.4	)	$	3.7	Total (loss) from continuing operations	$	(0.6	)	$	(1.1	)
						Total (loss) from discontinued operations		-			(0.1	)
						Total (loss)	$	(0.6	)	$	(1.2	)

	March 31, 2019		December 31, 2018
Long-term deferred compensation arrangements	$	14.0	$	14.0
Environmental liabilities		2.8		11.7
Fair value of derivative liabilities		10.0		6.1
Other		6.2		6.2
Total other long-term liabilities	$	33.0	$	38.0

	Amount of (Loss) Gain Recognized in Accumulated Other Comprehensive Income (“AOCI”) (Effective Portion)						Location of (Loss) Gain Reclassified from AOCI into Income (Effective Portion)	Gain (Loss) Reclassified from AOCI into Income (Effective Portion)
	Nine Months Ended							Three Months Ended						Nine Months Ended
	September 30,							September 30,						September 30,
	2017			2016				2017			2016			2017			2016
Derivatives in cash flow hedging relationships
Natural gas commodity contracts	$	(0.8	)	$	0.1		Cost of goods sold	$	-		$	0.1		$	0.3		$	(1.2	)
Foreign exchange contracts – purchases		(0.6	)		(0.2	)	Cost of goods sold		(0.1	)		(0.2	)		(0.1	)		0.4
Foreign exchange contracts – sales		(1.5	)		0.5		Net sales		(0.2	)		0.1			0.2			1.2
Interest rate swap contracts		0.1			(4.2	)	Interest expense		-			-			-			(10.7	)
Total	$	(2.8	)	$	(3.8	)		$	(0.3	)	$	-		$	0.4		$	(10.3	)

	Foreign Currency Translation Adjustments			Derivative Gain (Loss) ⁽¹⁾			Pension and Postretirement Adjustments⁽¹⁾			Total Accumulated Other Comprehensive (Loss)⁽¹⁾
Balance, December 31, 2016	$	(71.6	)	$	3.8		$	(336.0	)	$	(403.8	)
Other comprehensive income (loss) income before reclassifications, net of tax expense of $ -, $1.2, $0.6 and $1.8		20.9			(1.7	)		(2.6	)		16.6
Amounts reclassified from accumulated other comprehensive (loss)		-			(0.3	)		21.4			21.1
Net current period other comprehensive income (loss)		20.9			(2.0	)		18.8			37.7
Balance at September 30, 2017	$	(50.7	)	$	1.8		$	(317.2	)	$	(366.1	)

Period	Total Number of Shares Purchased¹		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Maximum Approximate Value of Shares that may yet be Purchased under the Plans or Programs
July 1 – 31, 2017		-	$	-		-	$	35,371,877
August 1 – 31, 2017		94,651	$	45.82		94,440	$	31,045,328
September 1 – 30, 2017		3,855	$	46.78		3,855	$	30,864,974
Total		98,506				98,295

Period	Total Number of Shares Purchased ⁽¹⁾		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Maximum Approximate Value of Shares that may yet be Purchased under the Plans or Programs
January 1 – 31, 2019		331,686	$	60.30		331,686	$	280,008,080
February 1 – 28, 2019		-	$	-		-	$	280,008,080
March 1 – 31, 2019		4,978	$	73.22		-	$	280,008,080
Total		336,664				331,686

Exhibit No.		Description

10.1		Eighth Amendment to Receivables Purchase Agreement, dated February 15, 2019, by and among Armstrong Receivables Company, LLC, Armstrong World Industries, Inc., The Bank of Nova Scotia, and Liberty Street Funding LLC, is incorporated by reference from the Annual Report on Form 10-K filed on February 25, 2019, wherein it appeared as Exhibit 10.13.

10.2		Armstrong World Industries, Inc. 2016 Long-Term Incentive Plan, effective as of July 8, 2016 and amended and restated effective February 20, 2019, is incorporated by reference from the Annual Report on Form 10-K filed on February 25, 2019, wherein it appeared as Exhibit 10.42.

31.1		Certification of Chief Executive Officer required by Rule 13a-15(e) or 15d-15(e) of the Securities Exchange Act. †

31.2		Certification of Chief Financial Officer required by Rule 13a-15(e) or 15d-15(e) of the Securities Exchange Act. †

32.1		Certification of Chief Executive Officer required by Rule 13a and 18 U.S.C. Section 1350. †

32.2		Certification of Chief Financial Officer required by Rule 13a and 18 U.S.C. Section 1350. †

101.INS		XBRL Instance Document. †

101.SCH		XBRL Taxonomy Extension Schema. †

101.CAL		XBRL Taxonomy Extension Calculation Linkbase. †

101.DEF		XBRL Taxonomy Extension Definition Linkbase. †

101.LAB		XBRL Taxonomy Extension Label Linkbase. †

101.PRE		XBRL Taxonomy Extension Presentation Linkbase. †

	Armstrong World Industries, Inc.

By:		/s/ Brian L. MacNeal
		Brian L. MacNeal, Senior Vice President and
		Chief Financial Officer (Principal Financial Officer)

By:		/s/ Stephen F. McNamara
		Stephen F. McNamara, Vice President and
		Controller (Principal Accounting Officer)