Income Taxes

12 Months Ended

Dec. 31, 2011

Notes to Financial Statements [Abstract]

Income Taxes

NOTE F - INCOME TAXES

The income tax provision (benefit) attributable to continuing operations for the years ended December 31, 2011, 2010 and 2009, consists of the following:

	Year Ended December 31,
	2011			2010			2009
	(In Thousands)
Current
Federal	$	(1,661	)	$	8,930		$	7,762
State		1,294			1,096			(856	)
Foreign		6,875			4,993			8,453
		6,508			15,019			15,359
Deferred
Federal		(7,053	)		(41,513	)		18,889
State		(2,258	)		(3,922	)		1,742
Foreign		3,554			(52	)		573
		(5,757	)		(45,487	)		21,204
Total tax provision (benefit)	$	751		$	(30,468	)	$	36,563

A reconciliation of the provision (benefit) for income taxes attributable to continuing operations, computed by applying the federal statutory rate for the years ended December 31, 2011, 2010 and 2009, to income before income taxes and the reported income taxes, is as follows:

	Year Ended December 31,
	2011			2010			2009
	(In Thousands)
Income tax provision (benefit) computed at
statutory federal income tax rates	$	2,182		$	(25,827	)	$	36,880
State income taxes (net of federal benefit)		(627	)		(1,837	)		576
Nondeductible expenses		1,577			1,654			1,566
Impact of international operations		(1,229	)		(3,526	)		(1,138	)
Excess depletion		(385	)		(377	)		(124	)
Other		(767	)		(555	)		(1,197	)
Total tax provision (benefit)	$	751		$	(30,468	)	$	36,563

The provision (benefit) for income taxes includes amounts related to the anticipated repatriation of certain earnings of our non-U.S. subsidiaries. Undistributed earnings above the amounts upon which taxes have been provided, which was $28.1 million at December 31, 2011, are intended to be permanently invested. It is not practicable to determine the amount of applicable taxes that would be incurred if any such earnings were repatriated.

Income (loss) before taxes and discontinued operations includes the following components:

	Year Ended December 31,
	2011			2010			2009
	(In Thousands)
Domestic	$	(9,167	)	$	(92,557	)	$	82,251
International		15,400			18,764			23,119
Total	$	6,233		$	(73,793	)	$	105,370

F-22

A reconciliation of the beginning and ending amount of our gross unrecognized tax benefit liability is as follows:

	Year Ended December 31,
	2011			2010			2009
	(In Thousands)
Gross unrecognized tax benefits at beginning of period	$	1,849		$	2,256		$	2,235
Increases in tax positions for prior years		-			-			561
Decreases in tax positions for prior years		-			-			-
Increases in tax positions for current year		-			-			-
Settlements		-			-			-
Lapse in statute of limitations		(297	)		(407	)		(540	)
Gross unrecognized tax benefits at end of period	$	1,552		$	1,849		$	2,256

We recognize interest and penalties related to uncertain tax positions in income tax expense. During the years ended December 31, 2011, 2010, and 2009, we credited $0.3 million, $0.2 million, and $0.5 million, respectively, for the net reversal of previously recorded interest and penalties to the provision for income tax. As of December 31, 2011 and 2010, we had $1.5 million and $1.8 million, respectively, of accrued potential interest and penalties associated with these uncertain tax positions. The total amount of unrecognized tax benefits that would affect our effective tax rate if recognized is $1.1 million and $1.4 million as of December 31, 2011 and 2010, respectively. We do not expect a significant change to the unrecognized tax benefits during the next twelve months.

We file tax returns in the U.S. and in various state, local, and non-U.S. jurisdictions. The following table summarizes the earliest tax years that remain subject to examination by taxing authorities in any major jurisdiction in which we operate:

Jurisdiction	Earliest Open Tax Period
United States - Federal	2008
United States - State and Local	2002
Non-U.S. jurisdictions	2005

We use the liability method for reporting income taxes, under which current and deferred tax assets and liabilities are recorded in accordance with enacted tax laws and rates. Under this method, at the end of each period, the amounts of deferred tax assets and liabilities are determined using the tax rate expected to be in effect when the taxes are actually paid or recovered. We will establish a valuation allowance to reduce the deferred tax assets when it is more likely than not that some portion or all of the deferred tax assets will not be realized. While we have considered future taxable income and ongoing tax planning strategies in assessing the need for the valuation allowance, there can be no guarantee that we will be able to realize all of our deferred tax assets. Significant components of our deferred tax assets and liabilities as of December 31, 2011 and 2010, are as follows:

Deferred Tax Assets:
	December 31,
	2011			2010
	(In Thousands)
Accruals	$	53,584		$	103,507
Goodwill		1,975			3,325
All other		28,062			35,709
Total deferred tax assets		83,621			142,541
Valuation allowance		(4,769	)		(7,121	)
Net deferred tax assets	$	78,852		$	135,420

F-23

Deferred Tax Liabilities:
	December 31,
	2011		2010
	(In Thousands)
Excess book over tax basis in
property, plant, and equipment	$	81,501	$	144,525
All other		6,225		7,100
Total deferred tax liability		87,726		151,625
Net deferred tax liability	$	8,874	$	16,205

The change in the valuation allowance during 2011 primarily relates to the state tax effects of restructuring certain subsidiaries. We believe the ability to generate sufficient taxable income may not allow us to realize all the tax benefits of the deferred tax assets within the allowable carryforward period. Therefore, an appropriate valuation allowance has been provided.

At December 31, 2011, we had approximately $8.3 million of foreign and state net operating loss carryforwards. In those countries and states in which net operating losses are subject to an expiration period, our loss carryforwards, if not utilized, will expire at various dates from 2012 through 2031. At December 31, 2011, we had $4.2 million of foreign tax credits available to offset future payment of federal income taxes. The foreign tax credits expire in varying amounts from 2015 through 2021.