INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2011

Income Before Income Taxes

Income before income taxes was taxed in the following jurisdictions in each of the years ended December 31:

	2011		2010			2009
	(Dollars in thousands)
Domestic	$	266,586	$	223,623		$	231,915
Foreign		23,581		(1,943	)		15,684
Total	$	290,167	$	221,680		$	247,599

The Components of the Provision for Income Taxes

The components of the provision for income taxes are as follows:

	2011			2010			2009
	(Dollars in thousands)
Current:
Federal	$	61,905		$	49,763		$	55,633
State		4,039			6,914			9,659
Foreign		7,287			(1,001	)		7,582
Current income tax provision		73,231			55,676			72,874
Deferred:
Federal		25,059			20,808			13,286
State		(883	)		3,381			2,306
Foreign		(413	)		(2,831	)		(276	)
Deferred income tax provision		23,763			21,358			15,316
	$	96,994		$	77,034		$	88,190

Variation of the Provision for Income Taxes from the Statutory U.S. Federal Income Tax Rate

The provision for income taxes varied from income taxes computed at the statutory U.S. federal income tax rate as a result of the following:

	2011			2010			2009
	(Dollars in thousands)
Income taxes computed at the statutory U.S. federal income tax rate	$	101,559		$	77,588		$	86,660
State income taxes, net of federal tax benefit		8,557			5,910			6,345
Tax liabilities required		507			2,488			2,578
Valuation allowance		(6,662	)		(88	)		1,525
Manufacturing exemption		(5,128	)		(6,834	)		(3,138	)
Tax credit refunds, net		(3,165	)		(2,096	)		(1,255	)
Foreign earnings taxed at other than 35%		94			(2,406	)		(2,292	)
Other		1,232			2,472			(2,233	)
	$	96,994		$	77,034		$	88,190
Effective tax rate		33.4	%		34.8	%		35.6	%

Significant Components of Deferred Tax Assets and Liabilities

Significant components of our deferred tax assets and liabilities at December 31 are as follows:

	2011			2010
	(Dollars in thousands)
Deferred tax assets:
Pension and other postretirement liabilities	$	49,273		$	29,936
Rationalization and other accrued liabilities		25,481			19,886
AMT and other credit carryforwards		6,129			5,676
Net operating loss carryforwards		21,228			21,195
Foreign currency translation		2			3,279
Inventory and related reserves		981			12,084
Other		8,301			10,451
Total deferred tax assets		111,395			102,507
Deferred tax liabilities:
Property, plant and equipment		(205,177	)		(158,671	)
Other intangible assets		(27,387	)		(24,827	)
Foreign currency translation		(18,078	)		—
Other		(4,322	)		(7,452	)
Total deferred tax liabilities		(254,964	)		(190,950	)
Valuation allowance		(11,840	)		(16,231	)
	$	(155,409	)	$	(104,674	)

Reconciliation of the Beginning and Ending Amount of Gross Unrecognized Tax Benefits

A reconciliation of the beginning and ending amount of gross unrecognized tax benefits included as other liabilities in our Consolidated Balance Sheets is as follows:

	2011			2010
	(Dollars in thousands)
Balance at January 1,	$	39,065		$	37,046
Increase based upon tax positions of current year		773			1,555
Increase based upon tax positions of a prior year		1,594			993
Increase due to acquisitions		8,968			—
Decrease based upon a lapse in the statute of limitations		(2,345	)		(529	)
Balance at December 31,	$	48,055		$	39,065