Income Taxes (Tables)

12 Months Ended

Jan. 01, 2023

Schedule of Income (Loss) Before Income Taxes

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


	Fiscal Year
	2022		2021		2020
	(in thousands)
U.S. operations	$	11,758	$	4,460	$	(7,104)
Foreign operations	30,159		68,173		(72,316)
Income (loss) before income taxes	$	41,917	$	72,633	$	(79,420)

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
	2022		2021		2020
	(in thousands)
Current expense (benefit):
Federal	$	1,624	$	1,987	$	(22,976)
Foreign	20,903		21,372		14,822
State	1,307		1,418		529
Current expense (benefit)	23,834		24,777		(7,625)

Deferred expense (benefit):
Federal	346		(2,841)		1,787
Foreign	(2,053)		(3,846)		(2,422)
State	230		(691)		769
Deferred expense (benefit)	(1,477)		(7,378)		134

Total income tax expense (benefit)	$	22,357	$	17,399	$	(7,491)

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 (benefit):


	Fiscal Year
	2022		2021		2020
	(in thousands)
Income taxes at U.S. federal statutory rate	$	8,803	$	15,253	$	(16,678)
Increase (decrease) in taxes resulting from:
State income taxes, net of federal tax effect	817		(87)		(2,033)
Non-deductible business expenses	237		330		1,792
Non-deductible employee compensation	1,678		1,213		(210)
Tax effects of Company-owned life insurance	612		(762)		(898)
Tax effects of undistributed earnings from foreign subsidiaries not deemed to be indefinitely reinvested	1,123		1,219		748
Foreign and U.S. tax effects attributable to foreign operations	3,528		1,748		(11,991)
Valuation allowance effect	2,898		1,349		12,927
Research and development tax credits	(917)		(793)		(780)
Goodwill impairment	6,171		—		24,464
Unrecognized tax benefits	(2,463)		(2,663)		(14,962)
Other	(130)		592		130
Income tax expense (benefit)	$	22,357	$	17,399	$	(7,491)

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
	2022		2021
	(in thousands)
Deferred tax assets
Lease liability	$	23,649	$	25,426
Net operating loss and interest carryforwards	7,616		5,962
Federal tax credit carryforwards	10,904		10,054
Derivative instruments	295		1,126
Deferred compensation	16,577		19,487
Inventory	3,521		3,100
Prepaids, accruals and reserves	6,947		8,777
Capitalized costs	7,467		4,805
Pensions	—		6,431
Other	58		175
Deferred tax asset, gross	77,034		85,343
Valuation allowance	(18,236)		(15,338)
Deferred tax asset, net	$	58,798	$	70,005

Deferred tax liabilities
Property and equipment	$	25,319	$	25,352
Intangible assets	25,533		30,736
Lease asset	22,811		24,856
Pensions	4,284		—
Foreign currency	600		458
Foreign withholding and U.S. state taxes on unremitted earnings	1,146		1,332
Deferred tax liabilities	79,693		82,734

Net deferred tax liabilities	$	20,895	$	12,729

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
	2022		2021		2020
	(in thousands)
Balance at beginning of year	$	8,220	$	10,799	$	25,486
Increases related to tax positions taken during the current year	342		265		271
Increases related to tax positions taken during the prior years	204		198		536
Decreases related to tax positions taken during the prior years	(447)		—		(673)
Decreases related to lapse of applicable statute of limitations	(2,574)		(2,309)		(14,992)
Changes due to settlements	—		(836)		—
Changes due to foreign currency translation	(2)		103		171
Balance at end of year	$	5,743	$	8,220	$	10,799