Income Taxes (Tables)

12 Months Ended

Dec. 31, 2016

Income Tax Disclosure [Abstract]

Components of Income (Loss) before Income Taxes, Domestic and Foreign

The provisions for income taxes were calculated based on the following components of income (loss) before income taxes:

Year ended December 31, (dollars in thousands)	2016			2015		2014
United States	$	29,742		$	27,146	$	(15,488	)
Non-U.S.	(1,958		)	971		29,018
Total income before income taxes	$	27,784		$	28,117	$	13,530

Current and Deferred Provisions (Benefit) for Income Taxes

The current and deferred provisions (benefit) for income taxes were:

Year ended December 31, (dollars in thousands)	2016			2015			2014
Current:
U.S. federal	$	470		$	300		$	59
Non-U.S.	7,625			9,142			10,180
U.S. state and local	201			162			157
Total current income tax provision (benefit)	8,296			9,604			10,396
Deferred:
U.S. federal	9,981			(44,068		)	227
Non-U.S.	334			(3,078		)	(2,066		)
U.S. state and local	(900		)	(674		)	10
Total deferred income tax provision (benefit)	9,415			(47,820		)	(1,829		)
Total:
U.S. federal	10,451			(43,768		)	286
Non-U.S.	7,959			6,064			8,114
U.S. state and local	(699		)	(512		)	167
Total income tax provision (benefit)	$	17,711		$	(38,216	)	$	8,567

Components of Deferred Income Tax Assets and Liabilities

The significant components of our deferred income tax assets and liabilities are as follows:

December 31, (dollars in thousands)	2016			2015
Deferred income tax assets:
Pension	$	11,799		$	9,644
Non-pension postretirement benefits	22,810			21,751
Other accrued liabilities	19,244			20,432
Receivables	2,756			2,341
Net operating loss and charitable contribution carry forwards	16,861			25,754
Tax credits	11,502			10,245
Total deferred income tax assets	84,972			90,167
Deferred income tax liabilities:
Property, plant and equipment	23,921			22,882
Inventories	3,866			2,378
Intangibles and other	5,255			7,883
Total deferred income tax liabilities	33,042			33,143
Net deferred income tax asset before valuation allowance	51,930			57,024
Valuation allowance	(13,773		)	(11,184		)
Net deferred income tax asset (liability)	$	38,157		$	45,840

Balance Sheet Locations of Deferred Tax Assets and Liabilities

The net deferred income tax assets and liabilities at December 31 of the respective year-ends were included in the Consolidated Balance Sheets as follows:

December 31, (dollars in thousands)	2016			2015
Non-current deferred income tax asset	40,016			48,662
Non-current deferred income tax liability	(1,859		)	(2,822		)
Net deferred income tax asset (liability)	$	38,157		$	45,840

Valuation Allowance Activity

The valuation allowance activity for the years ended December 31 is as follows:

Year ended December 31, (dollars in thousands)	2016		2015			2014
Beginning balance	$	11,184	$	66,486		$	46,048
Charge (benefit) to provision for income taxes	2,589		(49,877		)	3,507
Charge (benefit) to other comprehensive income	—		(5,425		)	16,931
Ending balance	$	13,773	$	11,184		$	66,486

Reconciliation of Statutory to Effective Income Tax Rate

Reconciliation from the statutory U.S. federal income tax rate to the consolidated effective income tax rate was as follows:

Year ended December 31,	2016			2015			2014
Statutory U.S. federal income tax rate	35.0		%	35.0		%	35.0		%
Increase (decrease) in rate due to:
Non-U.S. income tax differential	(2.1	)		(0.9	)		(25.9	)
U.S. state and local income taxes, net of related U.S. federal income taxes	(1.3	)		(2.0	)		0.8
U.S. federal credits	(2.2	)		—			—
Permanent adjustments	3.8			7.5			20.1
Foreign withholding taxes	5.7			4.7			14.8
Valuation allowance	11.1			(174.8	)		42.9
Unrecognized tax benefits	10.0			(0.3	)		(9.3	)
Impact of foreign exchange	3.4			(19.8	)		(14.0	)
Tax effect of intercompany capitalization	—			11.7			—
Other	0.3			3.0			(1.1	)
Consolidated effective income tax rate	63.7		%	(135.9	)	%	63.3		%

Change in Unrecognized Tax Benefits

A reconciliation of the beginning and ending gross unrecognized tax benefits, excluding interest and penalties, is as follows:

(dollars in thousands)	2016			2015			2014
Beginning balance	$	431		$	378		$	1,312
Additions based on tax positions related to the current year	382			293			—
Additions for tax positions of prior years	3,001			—			—
Reductions for tax positions of prior years	(293		)	—			(325		)
Changes due to lapse of statute of limitations	—			(240		)	(609		)
Ending balance	$	3,521		$	431		$	378

Other Unrecognized Tax Benefits Disclosures

We recognize interest and penalties related to unrecognized tax benefits in the provision for income taxes. Other disclosures relating to unrecognized tax benefits are as follows:

December 31, (dollars in thousands)	2016		2015			2014
Impact on the effective tax rate, if unrecognized tax benefits were recognized	$	3,414	$	378		$	306
Interest and penalties, net of tax benefit, accrued in the Consolidated Balance Sheets	$	273	$	28		$	174
Interest and penalties expense (benefit) recognized in the Consolidated Statements of Operations	$	245	$	(146	)	$	(363	)

Tax Years Subject to Income Tax Examination

As of December 31, 2016, the tax years that remained subject to examination by major tax jurisdictions were as follows:

Jurisdiction	Open Years
Canada	2012	–	2016
China	2007	–	2016
Mexico	2010	–	2016
Netherlands	2015	–	2016
Portugal	2013	–	2016
United States (excluding 2009 which is closed)	2008	–	2016