Income Taxes

6 Months Ended

Jun. 30, 2013

Income Tax Disclosure [Abstract]

Income taxes

Note 4 – Income taxes

		Three Months				Six Months
		Ended June 30,				Ended June 30,
(In millions)		2013		2012		2013		2012
Continuing operations
Provision (benefit) for income taxes	$	11.0		(9.1)		16.3		7.6
Effective tax rate		40.0	%	(33.8)	%	41.6	%	10.5	%

2013 Compared to U.S. Statutory Rate

The effective income tax rate on continuing operations in the first six months of 2013 was higher than the 35% U.S. statutory tax rate primarily due to a nondeductible remeasurement charge resulting from a currency devaluation in Venezuela in the first quarter, as well as additional devaluations forecasted in the second half of 2013. 

2012 Compared to U.S. Statutory Rate

The effective income tax rate on continuing operations in the first six months of 2012 was lower than the 35% U.S. statutory tax rate largely due to a $21 million non-cash income tax benefit as a result of a change in our funding strategy for retiree health care obligations (as described below), partially offset by withholding taxes and the characterization of a French business tax as an income tax.

We changed our funding strategy for certain retiree health care obligations and, as a result, we no longer expect to be affected by an income tax deduction limitation enacted by The Patient Protection and Affordable Care Act and The Health Care and Education Reconciliation Act of 2010 (“the Act”).  The Act disallows deductions for prescription drug benefit costs funded after December 31, 2012, to the extent these costs are reimbursed by a “Medicare Part D Subsidy.”   

		Three Months				Six Months
		Ended June 30,				Ended June 30,
(In millions)		2013		2012		2013		2012
Continuing operations
Provision (benefit) for income taxes	$	11.0		(9.1)		16.3		7.6
Effective tax rate		40.0	%	(33.8)	%	41.6	%	10.5	%

2013 Compared to U.S. Statutory Rate

The effective income tax rate on continuing operations in the first six months of 2013 was higher than the 35% U.S. statutory tax rate primarily due to a nondeductible remeasurement charge resulting from a currency devaluation in Venezuela in the first quarter, as well as additional devaluations forecasted in the second half of 2013. 

2012 Compared to U.S. Statutory Rate

The effective income tax rate on continuing operations in the first six months of 2012 was lower than the 35% U.S. statutory tax rate largely due to a $21 million non-cash income tax benefit as a result of a change in our funding strategy for retiree health care obligations (as described below), partially offset by withholding taxes and the characterization of a French business tax as an income tax.

We changed our funding strategy for certain retiree health care obligations and, as a result, we no longer expect to be affected by an income tax deduction limitation enacted by The Patient Protection and Affordable Care Act and The Health Care and Education Reconciliation Act of 2010 (“the Act”).  The Act disallows deductions for prescription drug benefit costs funded after December 31, 2012, to the extent these costs are reimbursed by a “Medicare Part D Subsidy.”