Income Taxes (Tables)

12 Months Ended

Jan. 03, 2021

Schedule of Income (Loss) Before Income Taxes

Income (loss) before income taxes consisted of the following:


	Fiscal Year
	2020		2019		2018
	(in thousands)
U.S. operations	$	(7,104)	$	46,463	$	35,728
Foreign operations	(72,316)		55,353		19,263
Income (loss) before income taxes	$	(79,420)	$	101,816	$	54,991

Schedule of Provisions for Federal, Foreign and State Income Taxes

Provisions for federal, foreign and state income taxes in the consolidated statements of operations consisted of the following components:


	Fiscal Year
	2020		2019		2018
	(in thousands)
Current expense (benefit):
Federal	$	(22,976)	$	8,414	$	(3,549)
Foreign	14,822		14,513		14,548
State	529		2,312		2,628
Current expense (benefit)	(7,625)		25,239		13,627

Deferred expense (benefit):
Federal	1,787		(625)		2,145
Foreign	(2,422)		(2,198)		(11,228)
State	769		200		194
Deferred expense (benefit)	134		(2,623)		(8,889)

Total income tax expense (benefit)	$	(7,491)	$	22,616	$	4,738

Schedule of Effective Income Tax Rate Reconciliation

The following summary reconciles income taxes at the U.S. federal statutory rate of 21% applicable for all periods presented to the Company’s actual income tax expense:


	Fiscal Year
	2020		2019		2018
	(in thousands)
Income taxes at U.S. federal statutory rate	$	(16,678)	$	21,381	$	11,548
Increase (decrease) in taxes resulting from:
State income taxes, net of federal tax effect	(2,033)		2,321		2,228
Non-deductible business expenses	1,792		933		1,352
Non-deductible employee compensation	(210)		1,453		2,566
Tax effects of Company owned life insurance	(898)		(636)		235
Tax effects of Tax Act:
One-time transition tax on foreign earnings	—		—		(5,000)
Remeasurement of net Deferred Tax Asset	—		—		(1,739)
Tax effects of undistributed earnings from foreign subsidiaries not deemed to be indefinitely reinvested	748		(183)		61
Foreign and U.S. tax effects attributable to foreign operations	(11,991)		783		(2,226)
Valuation allowance effect	12,927		133		(79)
Research and development tax credits	(780)		(700)		(2,863)
Goodwill impairment	24,464		—		—
Changes in unrecognized tax benefits	(14,962)		(3,324)		(1,010)
Other	130		455		(335)
Income tax expense (benefit)	$	(7,491)	$	22,616	$	4,738

Schedule of Deferred Tax Assets and Liabilities

The temporary differences that give rise to significant portions of the deferred tax assets and liabilities are as follows:


	End of Fiscal Year
	2020		2019
	(in thousands)
Deferred tax assets
Lease liability	$	28,094	$	29,782
Net operating loss carryforwards	4,031		3,090
Federal tax credit carryforwards	10,412		—
Derivative instruments	2,680		1,638
Deferred compensation	20,244		20,194
Inventory	4,004		3,200
Prepaids, accruals and reserves	3,659		7,935
Pensions	11,485		9,229
Other	50		71
Deferred tax asset, gross	84,659		75,139
Valuation allowance	(13,919)		(971)
Deferred tax asset, net	$	70,740	$	74,168

Deferred tax liabilities
Property and equipment	$	27,322	$	23,770
Intangible assets	30,745		33,760
Lease asset	27,268		29,301
Foreign currency	606		3,026
Foreign withholding and U.S. state taxes on unremitted earnings	931		178
Deferred tax liabilities	86,872		90,035

Net deferred tax liabilities	$	16,132	$	15,867

Schedule of Reconciliation of Unrecognized Tax Benefits

A reconciliation of the beginning and ending amounts of gross unrecognized tax benefits is as follows:


	Fiscal Year
	2020		2019		2018
	(in thousands)
Balance at beginning of year	$	25,486	$	28,143	$	29,221
Increases related to tax positions taken during the current year	271		318		671
Increases related to tax positions taken during the prior years	536		1,093		180
Decreases related to tax positions taken during the prior years	(673)		(2,809)		—
Decreases related to lapse of applicable statute of limitations	(14,992)		(1,266)		(1,861)
Changes due to foreign currency translation	171		7		(68)
Balance at end of year	$	10,799	$	25,486	$	28,143