Income Taxes

12 Months Ended

Dec. 31, 2011

Income Taxes [Abstract]

Income Taxes

Income Taxes

The effective tax rate for continuing operations was 27.3% in 2011, 16.0% in 2010 and 20.8% in 2009. A reconciliation of the Federal statutory income tax rate to the Company’s effective tax rate is as follows:

	Percent of Income before Income Taxes
	2011			2010			2009
Statutory Federal income tax rate		35.0	%		35.0	%		35.0	%
State income taxes — net of Federal tax benefit		0.7			(1.4	)		4.1
Foreign tax rate differential		0.4			(5.1	)		(21.0	)
Domestic production deduction		(3.5	)		0.8			(2.4	)
Non-deductible expenses		2.0			(0.9	)		3.9
Changes in unrecognized tax benefits		(14.4	)		—			—
Non-deductible goodwill		3.1			(16.2	)		—
Non-taxable claims settlement gain		—			2.6			—
Valuation allowances		3.0			—			(3.6	)
Other		1.0			1.2			4.8
Effective tax rate for the year		27.3	%		16.0	%		20.8	%

Income (loss) from continuing operations before income taxes was attributable to the following sources:

	2011			2010			2009
United States	$	39,740		$	(18,807	)	$	3,431
Foreign		(6,053	)		(32,214	)		5,402
Totals	$	33,687		$	(51,021	)	$	8,833

Income tax expense (benefit) from continuing operations consisted of the following:

	2011					2010						2009
	Current		Deferred			Current			Deferred			Current		Deferred
Federal	$	6,509	$	2,057		$	5,712		$	(12,933	)	$	1,080	$	171
Foreign		612		(371	)		(1,519	)		(544	)		1,265		(1,227	)
State and local		1,906		(1,531	)		983			115			898		(349	)
	$	9,027	$	155		$	5,176		$	(13,362	)	$	3,243	$	(1,405	)

Significant components of the Company’s deferred taxes as of December 31, 2011 and 2010 are as follows:

	2011			2010
Deferred income tax liabilities
Property, plant and equipment	$	23,974		$	24,707
Tax-deductible goodwill		4,940			1,803
State deferred taxes		1,286			2,042
Other		423			314
		30,623			28,866
Deferred income tax assets
Compensation		5,175			4,063
Inventory valuation		630			1,852
Allowance for uncollectible accounts		1,343			1,008
Non-deductible accruals		4,200			2,932
Other		571			-0-
Capital loss carryforwards		26,138			26,137
Net operating loss carryforwards		2,037			1,251
		40,094			37,244
Valuation Allowance		(28,175	)		(27,390	)
		11,919			9,855
Net deferred income tax liability	$	18,704		$	19,012

ASC 740 Income Taxes requires that deferred tax assets be reduced by a valuation allowance, if based on all available evidence, it is more likely than not that the deferred tax asset will not be realized. Available evidence includes the reversal of existing taxable temporary differences, future taxable income exclusive of temporary differences, taxable income in carryback years and tax planning strategies. The increase in the valuation allowance of $0.8 million resulted from additional foreign and state net operating losses from jurisdictions with uncertainty of future profitability. The Company has deferred tax assets of $2.0 million resulting from state and foreign net operating tax loss carryforwards of approximately $15.1 million, with carryforward periods that expire starting in 2019. The Company’s capital loss carryforwards of $26.1 million will expire in 2012.

No provision has been recorded for unremitted earnings of foreign subsidiaries as it is the Company’s intention to indefinitely reinvest these earnings of these subsidiaries. Accordingly, at December 31, 2011, the Company had not recorded a deferred tax liability for temporary differences related to investments in its foreign subsidiaries that are essentially permanent in duration. The amount of such temporary differences was estimated to be approximately $10.6 million and may become taxable in the U.S. upon a repatriation of assets or a sale or liquidation of the subsidiaries. It is not practical to estimate the related amount of unrecognized tax liability.

The following table summarizes the activity related to the Company’s unrecognized tax benefits:

	2011			2010
Balance at January 1		5,767			6,117
Increases related to current year tax positions		—			198
Increases related to previous year tax positions		395			79
Reductions due to lapse of applicable statute of limitations		(4,945	)		(627	)
Balance at December 31	$	1,217		$	5,767

The total amount of gross unrecognized tax benefits that would reduce the Company’s effective tax rate was $1.1 million and $5.5 million at December 31, 2011 and 2010, respectively. The amount of accrued interest expense included as a liability within the Company’s Consolidated Statements of Financial Position as of December 31, 2011 and 2010 was $0.1 million and $0.4 million, respectively.

As of December 31, 2011, the Company and its significant subsidiaries are subject to examination for the years after 2005 in Brazil, after 2006 in Canada, and after 2007 in the United States. The Company and its subsidiaries are subject to examination in certain states within the United States starting after 2006 and in the remaining states after 2007.

The Company is currently under examination of Federal income tax returns for 2009 in the United States and for 2008 and 2007 in Canada, as well as certain states. The Company does not expect any significant changes to its unrecognized tax benefits in the next 12 months.