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Income Taxes (Tables)

12 Months Ended

Dec. 30, 2017

(Loss) Income From Continuing Operations Before Income Taxes

(Loss) income from continuing operations, before income taxes consisted of the following:


	For the Year Ended
(in millions of U.S. dollars)	December 30, 2017			December 31, 2016			January 2, 2016
Canada	$	(29.1	)	$	(25.4	)	$	17.3
Outside Canada		(4.5	)		(13.7	)		(16.7	)

(Loss) income from continuing operations, before income taxes	$	(33.6	)	$	(39.1	)	$	0.6

Income Tax (Benefit) Expense

Income tax (benefit) expense consisted of the following:


	For the Year Ended
(in millions of U.S. dollars)	December 30, 2017			December 31, 2016			January 2, 2016
Current
Canada	$	—		$		—	$	4.0
Outside Canada		3.9				1.3		2.9

	$	3.9			$	1.3	$	6.9

Deferred
Canada	$	—			$	8.7	$	(1.2	)
Outside Canada		(33.9	)			11.2		(20.8	)

	$	(33.9	)		$	19.9	$	(22.0	)

Income tax (benefit) expense	$	(30.0	)		$	21.2	$	(15.1	)

Reconciliation of Income Taxes

The following table reconciles income taxes calculated at the basic Canadian corporate rates with the income tax provision:


	For the Year Ended
(in millions of U.S. dollars)	December 30, 2017			December 31, 2016			January 2, 2016
Income tax (benefit) expense based on Canadian statutory rates	$	(8.7	)	$	(10.1	)	$	0.1
Foreign tax rate differential		(1.3	)		(1.3	)		(0.5	)
Local taxes		(0.2	)		(1.1	)		(1.5	)
Nontaxable interest income		(11.3	)		(7.9	)		(5.5	)
Impact of intercompany transactions and dividends		(9.2	)		(10.6	)		(13.8	)
Nontaxable capital gains		(3.7	)		—			(1.4	)
Dividend income		—			1.1			0.9
Change in enacted tax rates		(32.7	)		(0.6	)		1.3
Change in valuation allowance		45.8			48.6			(0.8	)
Change in uncertain tax positions		(2.4	)		(0.2	)		(0.7	)
Equity compensation		1.1			0.6			0.9
Permanent differences		(0.6	)		1.8			0.7
Outside basis differences on discontinued operations		(3.8	)		—			—
Adjustments to deferred taxes		(3.4	)		—			5.5
Other items		0.4			0.9			(0.3	)

Income tax (benefit) expense	$	(30.0	)	$	21.2		$	(15.1	)

Deferred Income Tax Assets and Liabilities

Deferred income tax assets and liabilities were recognized on temporary differences between the financial and tax bases of existing assets and liabilities as follows:


(in millions of U.S. dollars)	December 30, 2017			December 31, 2016
Deferred tax assets
Net operating loss carryforwards	$	181.6		$	204.1
Capital loss carryforwards		4.5			1.1
Liabilities and reserves		35.7			42.5
Stock options		7.0			5.5
Inventories		4.5			5.2
Interest expense		25.4			31.1
Outside basis differences on discontinued operations		3.8			—
Other		4.9			9.4

		267.4			298.9

Deferred tax liabilities
Property, plant & equipment		(69.2	)		(104.5	)
Intangible assets		(165.2	)		(231.7	)

		(234.4	)		(336.2	)

Valuation allowance		(129.1	)		(117.7	)

Net deferred tax liability	$	(96.1	)	$	(155.0	)

Reconciliation of Unrecognized Tax Benefits

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


	For the Year Ended
(in millions of U.S. dollars)	December 30, 2017			December 31, 2016			January 2, 2016
Unrecognized tax benefits at beginning of year	$	28.6		$	9.9		$	12.3
Additions based on tax positions taken during a prior period		0.2			0.2			0.2
Reductions based on tax positions taken during a prior period		(6.3	)		—			(1.6	)
Settlement on tax positions taken during a prior period		(1.0	)		(4.5	)		(0.6	)
Tax rate change		(4.5	)		—			—
Lapse in statute of limitations		(3.2	)		(0.1	)		(1.8	)
Additions based on tax positions taken during the current period		1.7			24.0			1.9
Foreign exchange		0.7			(0.9	)		(0.5	)

Unrecognized tax benefits at end of year	$	16.2		$	28.6		$	9.9