Income Taxes (Tables)

12 Months Ended

Dec. 31, 2012

Income Before Income Taxes

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

	2012		2011		2010
	(Dollars in thousands)
Domestic	$	212,213	$	266,586	$	223,623
Foreign		11,574		23,581		(1,943	)
Total	$	223,787	$	290,167	$	221,680

Components of Provision for Income Taxes

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

	2012			2011			2010
	(Dollars in thousands)
Current:
Federal	$	57,106		$	61,905		$	49,763
State		8,449			4,039			6,914
Foreign		8,385			7,287			(1,001	)
Current income tax provision		73,940			73,231			55,676
Deferred:
Federal		5,999			25,059			20,808
State		(610	)		(883	)		3,381
Foreign		(6,888	)		(413	)		(2,831	)
Deferred income tax provision		(1,499	)		23,763			21,358
	$	72,441		$	96,994		$	77,034

Variation of Provision for Income Taxes from 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:

	2012			2011			2010
	(Dollars in thousands)
Income taxes computed at the statutory U.S. federal income tax rate	$	78,325		$	101,559		$	77,588
State income taxes, net of federal tax benefit		5,978			8,557			5,910
Tax liabilities (no longer required) required		(182	)		507			2,488
Valuation allowance		239			(6,662	)		(88	)
Manufacturing exemption		(6,865	)		(5,128	)		(6,834	)
Tax credit refunds, net		(1,066	)		(3,165	)		(2,096	)
Foreign earnings taxed at other than 35%		(566	)		94			(2,406	)
Deferred tax rate changes		(3,422	)		—			—
Other		—			1,232			2,472
	$	72,441		$	96,994		$	77,034
Effective tax rate		32.4	%		33.4	%		34.8	%

Significant Components of Deferred Tax Assets and Liabilities

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

	2012			2011
	(Dollars in thousands)
Deferred tax assets:
Pension and other postretirement liabilities	$	23,853		$	49,273
Rationalization and other accrued liabilities		28,040			25,481
AMT and other credit carryforwards		5,815			6,129
Net operating loss carryforwards		24,829			21,228
Foreign currency translation		—			2
Inventory and related reserves		14,013			981
Other		9,972			8,301
Total deferred tax assets		106,522			111,395
Deferred tax liabilities:
Property, plant and equipment		(193,887	)		(205,177	)
Other intangible assets		(26,302	)		(27,387	)
Foreign currency translation		(12,602	)		(18,078	)
Other		(10,358	)		(4,322	)
Total deferred tax liabilities		(243,149	)		(254,964	)
Valuation allowance		(12,361	)		(11,840	)
	$	(148,988	)	$	(155,409	)

Reconciliation of 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:

	2012			2011
	(Dollars in thousands)
Balance at January 1,	$	48,055		$	39,065
Increase based upon tax positions of current year		927			773
Increase based upon tax positions of a prior year		701			1,594
Increase due to acquisitions		3,316			8,968
Decrease based upon a lapse in the statute of limitations		(1,566	)		(2,345	)
Balance at December 31,	$	51,433		$	48,055