Income Taxes (Tables)

12 Months Ended

Dec. 26, 2014

Provision for (Benefit from) Income Taxes

The provision for (benefit from) income taxes consisted of the following (U.S. dollars in millions):



	Year ended
	December 26, 2014		December 27, 2013		December 28, 2012
Current:
U.S. federal income tax	$	3.1	$	4.6	$	10.1
State	0.9		1.0		1.2
Non-U.S.	5.6		8.9		0.1
	9.6		14.5		11.4
Deferred:
U.S. federal income tax	3.1		0.8		3.0
State	0.4		0.1		0.3
Non-U.S.	1.2		1.8		(2.5		)
	4.7		2.7		0.8
	$	14.3	$	17.2	$	12.2

Schedule of Income Before Income Tax, Domestic and Foreign

Income before income taxes consisted of the following (U.S. dollars in millions):



	Year ended
	December 26, 2014		December 27, 2013			December 28, 2012
U.S.	$	19.9	$	21.4		$	36.5
Non-U.S.	139.0		(38.1		)	120.7
	$	158.9	$	(16.7	)	$	157.2

Differences Between Reported Provision for (Benefit from) Income Taxes and Income Taxes Computed at U.S. Statutory Federal Income Tax Rate

The differences between the reported provision for (benefit from) income taxes and income taxes computed at the U.S. statutory federal income tax rate are explained in the following reconciliation (U.S. dollars in millions):



	Year ended
	December 26, 2014			December 27, 2013			December 28, 2012
Income tax provision (benefit) computed at the U.S. statutory federal rate	$	55.6		$	(5.9	)	$	55.0
Effect of tax rates on non-U.S. operations	(50.8		)	(33.5		)	(77.5		)
Provision for (reversal of) uncertain tax positions	0.2			3.3			(7.0		)
Non-deductible interest	(0.1		)	23.6			22.4
Foreign exchange	(5.6		)	(6.6		)	(5.3		)
Non-deductible intercompany charges	0.4			0.2			3.4
Non-deductible differences	2.1			0.9			1.8
Non-taxable income/loss	(2.4		)	(1.0		)	0.3
Non-deductible expenses	—			0.5			4.3
Non-deductible goodwill impairment	—			16.3			—
Adjustment to deferred balances	(0.2		)	2.5			—
Other	(1.2		)	0.1			1.0
Other taxes in lieu of income	—			2.3			3.1
Change in deferred rate	(0.8		)	1.4			(2.6		)
Tax credits	(0.3		)	(2.0		)	—
Increase/(decrease) in valuation allowance ⁽¹⁾	17.4			15.1			13.3
Provision for income taxes	$	14.3		$	17.2		$	12.2

_____________

⁽¹⁾ The (decrease)/increase in valuation allowance includes effects of foreign exchange and adjustments to deferred tax balances which were fully offset by valuation allowance.

Deferred Income Tax Assets and Liabilities

Deferred income tax assets and liabilities consisted of the following (U.S. dollars in millions):



		December 26,			December 27,
Deferred tax liabilities:		2014			2013
Current:
	Allowances and other accrued liabilities	$	(2.7	)	$	(1.3	)
	Inventories	(15.6		)	(14.4		)
	Total current deferred tax liabilities	(18.3		)	(15.7		)

Noncurrent:
	Property, plant and equipment	(64.7		)	(68.1		)
	Equity in earnings of unconsolidated companies	(0.2		)	(0.2		)
	Pension	(2.8		)	(3.6		)
	Other noncurrent deferred tax liabilities	(6.3		)	(7.3		)

	Total noncurrent deferred tax liabilities	(74.0		)	(79.2		)
Total current and noncurrent deferred tax liabilities		$	(92.3	)	$	(94.9	)

Deferred tax assets:
Current:
	Net operating loss carryforwards	$	6.4		$	3.1
	Allowances and other accrued assets	13.2			13.0
	Inventories	4.8			3.7
	Total current deferred tax assets	24.4			19.8
	Valuation allowance	(12.1		)	(9.0		)
Total net current deferred tax assets		12.3			10.8

Noncurrent:
	Pension liability	22.1			20.2
	Property, plant and equipment	2.4			4.0
	Post-retirement benefits other than pension	0.3			0.5
	Net operating loss carryforwards	158.8			162.9
	Capital loss carryover	3.5			3.1
	Other noncurrent assets	26.1			33.1
	Total noncurrent deferred tax assets	213.2			223.8
	Valuation allowance	(167.4		)	(171.4		)
Total net noncurrent deferred tax assets		45.8			52.4

Total deferred tax assets, net		$	58.1		$	63.2

Net deferred tax liabilities		$	(34.2	)	$	(31.7	)

Federal and Foreign Tax Operating Loss Carry-Forwards Expiring

At December 26, 2014, we had approximately $590.7 million of federal and foreign tax operating loss carry-forwards expiring as follows (U.S. dollars in millions):



Expires:
2014	$	30.8
2015	32.3
2016	23.2
2017	29.8
2018 and beyond	3.2
No expiration	471.4
	$	590.7

Reconciliation of Beginning and Ending Amount of Uncertain Tax Positions Excluding Interest and Penalties

A reconciliation of the beginning and ending amount of uncertain tax positions excluding interest and penalties is as follows (U.S. dollars in millions):



	December 26, 2014		December 27, 2013			December 28, 2012
Beginning balance	$	3.0	$	4.1		$	14.6
Gross decreases - tax position in prior period	—		(0.2		)	(1.2		)
Gross increases - current-period tax positions	0.5		1.4			0.5
Settlements	—		(2.3		)	(2.4		)
Lapse of statute of limitations	—		—			(7.6		)
Foreign exchange	—		—			0.2
Ending balance	$	3.5	$	3.0		$	4.1

- Definition

Tabular disclosure of tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities (i.e., uncertain tax positions) and other types of income tax contingencies, including: (1) the policy on classification of interest and penalties; (2) a tabular reconciliation of the total amounts of unrecognized tax benefits at the beginning and end of the period; the total amount(s) of: (3) unrecognized tax benefits that, if recognized, would affect the effective tax rate, and (4) interest and penalties recognized in each of the income statement and balance sheet; (5) for positions for which it is reasonably possible that the total amounts unrecognized will significantly change within 12 months of the reporting date the: (i) nature of the uncertainty, (ii) nature of the event that could occur that would cause the change, and (iii) an estimate of the range of the reasonably possible change or a statement that an estimate of the range cannot be made; and (6) a description of tax years that remain subject to examination by major tax jurisdictions.

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