Income Taxes (Tables)

12 Months Ended

Dec. 30, 2011

Provision for (Benefit from) Income Taxes

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



	December 30, 2011			December 31, 2010			January 1, 2010
Current:
U.S. federal income tax	$	3.6		$	0.2		$	1.0
State	0.7			0.5			1.1
Non-U.S.	12.4			2.9			2.4
	16.7			3.6			$	4.5
Deferred:
U.S. federal income tax	2.5			0.1			(18.4		)
State	0.2			—			(1.8		)
Non-U.S.	(13.7		)	(4.4		)	2.9
	(11.0		)	(4.3		)	(17.3		)
	$	5.7		$	(0.7	)	$	(12.8	)

Schedule of Income Before Income Tax, Domestic and Foreign

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



	December 30, 2011		December 31, 2010		January 1, 2010
U.S.	$	17.2	$	20.2	$	59.0
Non-U.S.	83.3		39.9		72.8
	100.5		60.1		131.8

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 ⁽¹⁾
	December 30, 2011			December 31, 2010			January 1, 2010
Income tax provision (benefit) computed at the U.S. statutory federal rate	$	35.2		$	21.0		$	46.1
Effect of tax rates on non-U.S. operations	(75.0		)	(76.9		)	(66.5		)
Provision for (reversal of) uncertain tax positions	4.7			(2.0		)	(2.9		)
Non-deductible interest	31.4			27.3			17.4
Foreign exchange	(2.2		)	7.6			19.0
Non-deductible intercompany charges	(0.5		)	(3.1		)	(0.2		)
Non-deductible differences	4.0			1.5			2.7
Non-taxable income/loss	(0.9		)	3.2			(1.7		)
Non-deductible expenses	8.8			—			—
Net operating loss re-established due to settlement of audit	—			0.5			(4.5		)
Other	1.7			1.6			0.2
Change in deferred rate	0.4			0.5			0.4
Tax credits	(0.5		)	(1.3		)	—
Increase/(decrease) in valuation allowance ⁽²⁾	(1.4		)	19.4			(22.8		)
Provision for (benefit from) income taxes	$	5.7		$	(0.7	)	$	(12.8	)

_____________

⁽¹⁾ Certain amounts in prior years have been reclassified to conform to current year presentation.

⁽²⁾ The increase/(decrease) 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 30,			December 31,
Deferred tax liabilities:		2011			2010
Current:
	Allowances and other accrued liabilities	$	(2.5	)	$	(3.5	)
	Inventories	(13.2		)	(24.0		)
	Total current tax liabilities	(15.7		)	(27.5		)

Noncurrent:
	Property, plant and equipment	(72.0		)	(74.9		)
	Equity in earnings of unconsolidated companies	0.2			(0.7		)
	Pension	(2.7		)	(1.9		)
	Other noncurrent liabilities	(5.1		)	(4.8		)

	Total noncurrent deferred tax liabilities	(79.6		)	(82.3		)
Total current and noncurrent deferred tax liabilities		$	(95.3	)	$	(109.8	)

Deferred tax assets:
Current:
	Net operating loss carryforwards	$	6.0		$	9.4
	Allowances and other accrued assets	22.1			27.1
	Inventories	2.9			3.5
	Total current deferred tax assets	31.0			40.0
	Valuation allowance	(18.6		)	(22.5		)
Total net current deferred tax assets		12.4			17.5

Noncurrent:
	Pension liability	21.6			20.4
	Property, plant and equipment	5.5			7.9
	Post-retirement benefits other than pension	0.9			1.0
	Net operating loss carryforwards	149.6			160.0
	Capital loss carryover	2.8			7.7
	Other noncurrent assets	32.2			33.1
	Total noncurrent deferred tax assets	212.6			230.1
	Valuation allowance	(155.7		)	(172.9		)
Total net noncurrent deferred tax assets		56.9			57.2

Total deferred tax assets, net		$	69.3		$	74.7

Net deferred tax liabilities		$	(26.0	)	$	(35.1	)

Federal and Foreign Tax Operating Loss Carry-Forwards Expiring

At December 30, 2011, we had approximately $589.1 million of federal and foreign tax operating loss carry-forwards expiring as follows (U.S. dollars in millions):



Expires:
2012	$	9.3
2013	33.4
2014	48.6
2015 and beyond	56.9
No expiration	440.9
Total	$	589.1

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 30			December 31			January 1,
	2011			2010			2010
Beginning balance	$	14.2		$	16.5		$	20.4
Gross decreases - tax position in prior period	—			(1.0		)	(0.8		)
Gross increases - current-period tax positions	5.3			0.9			1.2
Settlements	(3.4		)	(1.3		)	(3.3		)
Lapse of statute of limitations	(0.6		)	(1.3		)	(0.3		)
Foreign exchange	(0.9		)	0.4			(0.7		)
Ending balance	$	14.6		$	14.2		$	16.5

- 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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