Income Taxes

12 Months Ended

Dec. 31, 2013

Income Tax Disclosure [Abstract]

Income taxes

Note 4 – Income Taxes

		Years Ended December 31,
(In millions)		2013	2012	2011
Income (loss) from continuing operations before income taxes
U.S.	$	(51.8)	(19.6)	(16.0)
Foreign		200.0	178.7	204.3
Income from continuing operations before income taxes	$	148.2	159.1	188.3

Provision (benefit) for income taxes from continuing operations
Current tax expense (benefit)
U.S. federal	$	0.5	(0.1)	2.9
State		1.5	(0.3)	(0.1)
Foreign		84.6	70.9	91.9
Current tax expense		86.6	70.5	94.7
Deferred tax expense (benefit)
U.S. federal		(20.6)	(29.9)	(21.3)
State		(1.9)	(1.4)	(0.9)
Foreign		(12.1)	(12.1)	(8.5)
Deferred tax benefit		(34.6)	(43.4)	(30.7)
Provision (benefit) for income taxes of continuing operations	$	52.0	27.1	64.0

		Years Ended December 31,
(In millions)		2013	2012	2011
Comprehensive provision (benefit) for income taxes allocable to
Continuing operations	$	52.0	27.1	64.0
Discontinued operations		4.7	(1.0)	(3.9)
Other comprehensive income (loss)		141.0	9.3	(74.4)
Equity		2.8	2.7	(1.1)
Comprehensive provision (benefit) for income taxes	$	200.5	38.1	(15.4)

Rate Reconciliation

The following table reconciles the difference between the actual tax rate on continuing operations and the statutory U.S. federal income tax rate of 35%.

		Years Ended December 31,
(In percentages)		2013		2012		2011
U.S. federal tax rate		35.0	%	35.0	%	35.0	%
Increases (reductions) in taxes due to:
	Adjustments to valuation allowances	4.0		1.2		(2.9)
	Foreign income taxes	(6.5)		(2.2)		0.3
	Medicare subsidy for retirement plans	(1.1)		(14.4)		-
	French business tax	3.0		2.7		2.4
	Nontaxable acquisition-related (gains) losses	-		-		(0.4)
	Taxes on undistributed earnings of foreign affiliates	(0.1)		(2.2)		0.2
	State income taxes, net	(0.1)		(0.1)		(0.5)
	Change in judgment about uncertain tax positions in Mexico	-		(4.7)		-
	Other	0.9		1.7		(0.1)
Actual income tax rate on continuing operations		35.1	%	17.0	%	34.0	%

Components of Deferred Tax Assets and Liabilities

			December 31,
(In millions)			2013	2012
Deferred tax assets
Pension liabilities		$	70.0	136.4
Retirement benefits other than pensions			60.7	127.2
Workers’ compensation and other claims			35.1	38.3
Other assets and liabilities			138.6	115.3
Net operating loss carryforwards			26.8	63.5
Alternative minimum and other tax credits(a)			44.7	37.9
Subtotal			375.9	518.6
Valuation allowances			(32.4)	(47.4)
Total deferred tax assets			343.5	471.2
Deferred tax liabilities
Property and equipment, net			9.9	11.2
Other assets and miscellaneous			31.0	37.4
Deferred tax liabilities			40.9	48.6
Net deferred tax asset		$	302.6	422.6
Included in:
	Current assets	$	72.0	59.4
	Noncurrent assets		251.7	385.3
	Current liabilities, included in accrued liabilities		(3.1)	(3.4)
	Noncurrent liabilities		(18.0)	(18.7)
Net deferred tax asset		$	302.6	422.6

(a) U.S. alternative minimum tax credits of $43.8million have an unlimited carryforward periodand the remaining credits of $0.9million have various carryforward periods.

Valuation Allowances

Valuation allowances relate to deferred tax assets in various federal, state and non-U.S. jurisdictions. Based on our historical and expected future taxable earnings, and a consideration of available tax-planning strategies, we believe it is more likely than not that we will realize the benefit of the existing deferred tax assets, net of valuation allowances, at December 31, 2013.

				Years Ended December 31,
(In millions)				2013	2012	2011
Valuation allowances:
	Beginning of year		$	47.4	43.9	45.9
	Expiring tax credits			(1.8)	(0.8)	(0.3)
	Acquisitions and dispositions			(32.7)	(0.9)	0.3
	Changes in judgment about deferred tax assets(a)			(0.2)	(1.0)	(8.2)
	Other changes in deferred tax assets, charged to:
		Income from continuing operations		6.2	3.4	7.6
		Income from discontinued operations		12.5	1.9	-
		Other comprehensive income (loss)		-	0.1	-
	Foreign currency exchange effects			1.0	0.8	(1.4)
	End of year		$	32.4	47.4	43.9

• Changes in judgment about valuation allowances are based on a recognition threshold of “more-likely-than-not.”Amounts are based on beginning-of-year balances of deferred tax assets that could potentially be realized in future years. Amounts are recognized in income from continuing operations.

Undistributed Foreign Earnings

As of December 31, 2013, we have not recorded U.S. federal deferred income taxes on approximately$259million of undistributed earnings of foreign subsidiaries and equity affiliates. It is expected that these earnings will be permanently reinvested in operations outside the U.S. It is not practical to compute the estimated deferred tax liability on these earnings.

Net Operating Losses

The gross amount of the net operating loss carryforwards as of December 31, 2013, was $214.5million. The tax benefit of net operating loss carryforwards, before valuation allowances, as of December 31, 2013, was $26.8 million, and expires as follows:

(In millions)			Federal	State	Foreign	Total
Years of expiration
	2014-2018	$	-	0.3	3.9	4.2
	2019-2023		-	0.2	5.3	5.5
	2024 and thereafter		-	10.3	0.4	10.7
	No expiration		-	-	6.4	6.4
		$	-	10.8	16.0	26.8

Uncertain Tax Positions

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:

			Years Ended December 31,
(In millions)			2013	2012	2011
Uncertain tax positions:
	Beginning of year	$	11.8	17.2	19.4
	Increases related to prior-year tax positions		0.1	1.4	0.8
	Decreases related to prior-year tax positions		-	(6.9)	(1.6)
	Increases related to current-year tax positions		2.3	1.6	1.3
	Settlements		(0.7)	(0.7)	-
	Effect of the expiration of statutes of limitation		(3.4)	(1.2)	(1.2)
	Increases (decreases) related to business combinations and dispositions		-	-	(0.7)
	Foreign currency exchange effects		0.7	0.4	(0.8)
	End of year	$	10.8	11.8	17.2