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Income Taxes
9 Months Ended
Jun. 29, 2013
Income Tax Expense (Benefit) [Abstract]  
Income Taxes
INCOME TAXES
Income tax (benefit) expense for the three and nine months ended June 29, 2013 was $(0.3) million and $2.8 million, respectively. The effective tax rates for the three and nine months ended June 29, 2013 were (1.1) percent and 4.6 percent, respectively. The decrease in the effective tax rate for the quarter, compared to the effective tax rate for the current fiscal year-to-date, was due to a $2.0 million discrete tax benefit resulting from the expiration of three interest rate swap contracts during the quarter. The decrease in the effective tax rate for the three and nine months ended June 29, 2013, as compared to 7.6 percent and 9.1 percent, for the three and nine months ended June 30, 2012, respectively, was primarily due to an increase in the portion of the Company's income from its APAC segment, which benefits from reduced taxes due to tax holidays and the discrete tax benefit noted above. Also, as demonstrated in recent quarters, the tax rate will vary during the year based on the mix of forecasted earnings by tax jurisdiction.
As of June 29, 2013, there was no material change in the amount of unrecognized tax benefits recorded for uncertain tax positions as compared to fiscal 2012 year end. The Company recognizes accrued interest and penalties related to uncertain tax positions in income tax expense. The amount of interest and penalties recorded for both the three and nine months ended June 29, 2013 and June 30, 2012 was not material.
It is reasonably possible that a number of uncertain tax positions may be settled within the next 12 months. The Company is currently under examination by taxing authorities in the U.S.; however, the Company is not currently under examination in any of the foreign jurisdictions in which the Company has significant operations.
The Company maintains valuation allowances when it is more likely than not that all or a portion of a deferred tax asset will not be realized. During the three and nine months ended June 29, 2013, the Company continued to record a full valuation allowance against its net deferred tax assets in the U.S., Germany and Romania and at one of the Company's subsidiaries in the United Kingdom, as it is more likely than not that these assets will not be fully realized based primarily on historical performance. The Company will continue to provide a valuation allowance against its net deferred tax assets in each of the applicable jurisdictions going forward until the need for a valuation allowance is eliminated. The need for a valuation allowance will be eliminated when the Company determines it is more likely than not that the deferred tax assets will be realized.