Income Tax Matters

6 Months Ended

Jun. 30, 2014

Income Tax Disclosure [Abstract]

Income Tax Matters

Income Tax Matters

The provision for incomes taxes, for each period presented, consisted of the following:

	Quarter Ended				Six Months Ended
	June 30,				June 30,
	2014		2013		2014		2013
Domestic	$	13.9	$	11.1	$	23.0	$	26.5
Foreign	0.6		0.6		0.9		(6.6		)
Total	$	14.5	$	11.7	$	23.9	$	19.9

The income tax provision for the quarters ended June 30, 2014 and June 30, 2013 was $14.5 and $11.7, reflecting an effective tax rate of 37.0% and 38.6%, respectively. There was no material difference between the effective tax rate and the projected blended statutory tax rate for the quarter ended June 30, 2014.

The difference between the effective tax rate and the projected blended statutory tax rate for the quarter ended June 30, 2013 was primarily the result of an increase in unrecognized tax benefits, including interest and penalties, of $0.3, resulting in a 0.9% increase in the effective tax rate.

The income tax provision for the six months ended June 30, 2014 and June 30, 2013 was $23.9 and $19.9, reflecting an effective tax rate of 37.2% and 27.7%, respectively. There was no material difference between the effective tax rate and the projected blended statutory tax rate for the six months ended June 30, 2014.

The difference between the effective tax rate and the projected blended statutory tax rate for the six months ended June 30, 2013 was the result of a decrease in unrecognized tax benefits, including interest and penalties, of $7.2, resulting in a 10.0% decrease in the effective tax rate. The decrease in unrecognized tax benefits was primarily a result of an audit settlement with the Canada Revenue Agency Competent Authority on February 28, 2013 for the 1998-2004 tax years which resulted in a cash tax benefit to the Company of $7.7, of which $7.2 has been received as of June 30, 2014. In addition, during the third quarter of 2013, the Company signed an advance pricing agreement with the Canada Revenue Agency, which resulted in an additional cash tax benefit of $2.8, which is expected to be refunded within the next 12 months.

The Company’s gross unrecognized benefits relating to uncertain tax positions was $3.8 at both June 30, 2014 and December 31, 2013, of which, $2.7 will go through the Company’s income tax provision and thus impact the effective tax rate at both June 30, 2014 and December 31, 2013, if and when the gross unrecognized tax benefits are recognized.

The Company expects its gross unrecognized tax benefits to be reduced by $1.8 within the next 12 months.

See Note 6 of Notes to Consolidated Financial Statements included in Part II, Item 8. “Financial Statements and Supplementary Data” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013 for additional information regarding income taxes.