Income Taxes

9 Months Ended

Sep. 30, 2011

Income Taxes [Abstract]

Income Taxes

Income Taxes

The Company’s effective tax rate differs from the United States statutory tax rate primarily due to valuation allowances, changes in the mix of earnings in countries with differing statutory tax rates, changes in accruals related to uncertain tax positions and tax planning structures. At September 30, 2011 and December 31, 2010 we had $1.3 million and $1.1 million, respectively, of gross unrecognized tax benefits, exclusive of interest and penalties.

Further, our current and future provision for income taxes for 2011 is significantly impacted by valuation allowances. In the United States, China, the Netherlands and Portugal we have recorded valuation allowances against our deferred income tax assets. For the three months and nine months ended September 30, 2011, we did not release any valuation allowance. For the three months and nine months ended September 30, 2010, we reduced our valuation allowance by $0 and $1.1 million. The release of the valuation allowance in 2010 was related to the utilization of net operating losses in Mexico. In assessing the need for recording a valuation allowance, we weigh all available positive and negative evidence. Examples of the evidence we consider are cumulative losses in recent years, losses expected in early future years, a history of potential tax benefits expiring unused, and whether there was an unusual, infrequent or extraordinary item to be considered. Based on our analysis of all available evidence, we intend to maintain these allowances until it is more likely than not that the deferred income tax assets will be realized.

Income tax payments consist of the following:

	Three months ended September 30,					Nine months ended September 30,
(dollars in thousands)	2011		2010			2011		2010
Total income tax payments (refunds), net	$	1,843	$	(160	)	$	13,029	$	5,379
Less: credits or offsets	842		83			4,340		920
Cash paid (refunded), net	$	1,001	$	(243	)	$	8,689	$	4,459