Restatement of Consolidated Financial Statements

On October 29, 2012, the Company announced that it had identified historical accounting errors relating to inventory. The inventory accounting issues resulted in understated cost of sales and overstated inventory balances for the years ended December 31, 2011, 2010 and 2009. For the years ended December 31, 2011, 2010, 2009, and 2008, and for the three months ended March 30, 2012 and six months ended June 29, 2012, cost of sales was understated by $17.9 million, $8.3 million, $5.6 million, $7.1 million, $2.7 million and $6.2 million, respectively. As of December 31, 2011, 2010, 2009 and 2008, March 30, 2012 and June 29, 2012 inventory balances were overstated by $40.0 million, $27.0 million, $17.4 million, $8.7 million, $43.7 million, and $43.5 million, respectively.

The Company believes that the inventory accounting issues are, to a significant extent, attributable to a complex theft scheme in Brazil and, to a somewhat lesser extent, accounting errors, primarily in Brazil, affecting work in process and finished goods inventory that were not detected due to a deficient reconciliation process. In addition, due to accounting errors at one of the Brazilian facilities that occurred prior to the Company's acquisition of PDIC in 2007, the Company overstated inventory in its allocation of the purchase price among assets acquired, resulting in an understatement of goodwill. The understated goodwill and overstated inventory associated with the acquisition of PDIC in the fourth quarter of 2007 is each $3.4 million.

The Company is also restating cost of sales, inventory, property, plant and equipment, accumulated other comprehensive income and retained earnings to correct two additional accounting errors associated with foreign currency adjustments, described below.

The Company incorrectly recorded foreign currency adjustments related to certain intercompany transactions between the Company's U.S. and Canadian subsidiaries in other comprehensive income rather than in other income (expense) in the Consolidated Statements of Operations and Comprehensive Income (Loss). The Company has corrected this error in the accompanying restated financial statements. As of December 31, 2011 and 2010, accumulated other comprehensive income was overstated, and retained earnings were understated, by $6.5 million before consideration of the related income tax provision of $3.0 million, including foreign currency translation.

The Company also made erroneous foreign currency adjustments related to inventory and property, plant and equipment within the Company's Mexican subsidiary. The Company has corrected this error in the accompanying financial statements. As of December 31, 2011, 2010 and 2009, inventory was overstated by $3.1 million and property plant and equipment was overstated by $5.0 million, while retained earnings were understated by $8.1 million, prior to foreign currency translation. In addition, cost of sales is understated for the year ended December 31, 2009 by $8.1 million.

The following discloses each line item that is affected by the restatement of the Company's consolidated financial statements as of December 31, 2011 and 2010 and the three years ended December 31, 2011, 2010, and 2009.

Consolidated Statements of Operations and Comprehensive Income (Loss):



	Year ended December 31, 2011
(in millions, except per share data)	As Previously Reported			Effect of Restatement			Restated
Cost of sales	$	5,241.1		$	17.9		$	5,259.0
Gross profit	625.6			(17.9		)	607.7
Operating income	248.0			(17.9		)	230.1
Income before income taxes	124.8			(17.9		)	106.9
Income tax (provision) benefit	(42.5		)	(0.2		)	(42.7		)
Net income including noncontrolling interest	85.2			(18.1		)	67.1
Net income attributable to Company common shareholders	83.8			(18.1		)	65.7
Comprehensive income	(39.4		)	(12.2		)	(51.6		)
Earnings per common share - basic	1.61			(0.34		)	1.27
Earnings per common share - assuming dilution	1.57			(0.34		)	1.23



	Year ended December 31, 2010
(in millions, except per share data)	As Previously Reported			Effect of Restatement			Restated
Cost of sales	$	4,310.9		$	8.3		$	4,319.2
Gross profit	554.0			(8.3		)	545.7
Operating income	222.4			(8.3		)	214.1
Income before income taxes	122.7			(8.3		)	114.4
Income tax (provision) benefit	(47.2		)	0.5			(46.7		)
Net income including noncontrolling interest	76.9			(7.8		)	69.1
Net income attributable to Company common shareholders	69.2			(7.8		)	61.4
Comprehensive income	89.4			(9.6		)	79.8
Earnings per common share - basic	1.33			(0.15		)	1.18
Earnings per common share - assuming dilution	1.31			(0.15		)	1.16



	Year ended December 31, 2009
(in millions, except per share data)	As Previously Reported			Effect of Restatement			Restated
Cost of sales	$	3,865.7		$	13.7		$	3,879.4
Gross profit	519.5			(13.7		)	505.8
Operating income	179.9			(13.7		)	166.2
Income before income taxes	96.3			(13.7		)	82.6
Income tax (provision) benefit	(32.7		)	(3.1		)	(35.8		)
Net income including noncontrolling interest	64.5			(16.8		)	47.7
Net income attributable to Company common shareholders	56.3			(16.8		)	39.5
Comprehensive income	219.9			(19.5		)	200.4
Earnings per common share - basic	1.08			(0.32		)	0.76
Earnings per common share - assuming dilution	1.07			(0.32		)	0.75

Consolidated Balance Sheets:



	December 31, 2011
(in millions)	As Previously Reported			Effect of Restatement			Restated
Assets
Inventories, net	$	1,228.7		$	(43.2	)	$	1,185.5
Deferred income taxes	43.4			(0.2		)	43.2
Total current assets	2,887.1			(43.4		)	2,843.7
Property, plant and equipment, net	1,028.6			(4.8		)	1,023.8
Deferred income taxes	18.6			(2.4		)	16.2
Goodwill	164.9			3.2			168.1
Total assets	4,370.4			(47.4		)	4,323.0
Liabilities
Other liabilities	243.1			2.8			245.9
Total liabilities	2,858.5			2.8			2,861.3
Equity
Retained earnings	959.1			(46.3		)	912.8
Accumulated other comprehensive income (loss)	(95.1		)	(3.9		)	(99.0		)
Total Company shareholders’ equity	1,398.6			(50.2		)	1,348.4
Total equity	1,511.9			(50.2		)	1,461.7
Total liabilities and equity	4,370.4			(47.4		)	4,323.0



	December 31, 2010
(in millions)	As Previously Reported		Effect of Restatement			Restated
Assets
Inventories, net	$	1,118.9	$	(30.6	)	$	1,088.3
Deferred income taxes	39.8		(0.6		)	39.2
Total current assets	2,805.7		(31.2		)	2,774.5
Property, plant and equipment, net	1,039.6		(5.4		)	1,034.2
Deferred income taxes	11.3		(2.2		)	9.1
Goodwill	174.9		3.6			178.5
Total assets	4,327.7		(35.2		)	4,292.5
Liabilities
Other liabilities	235.3		2.8			238.1
Total liabilities	2,722.4		2.8			2,725.2
Equity
Retained earnings	875.3		(28.2		)	847.1
Accumulated other comprehensive income (loss)	23.5		(9.8		)	13.7
Total Company shareholders’ equity	1,482.0		(38.0		)	1,444.0
Total equity	1,605.3		(38.0		)	1,567.3
Total liabilities and equity	4,327.7		(35.2		)	4,292.5

Consolidated Statements of Cash Flows:



	Year ended December 31, 2011
(in millions)	As Previously Reported			Effect of Restatement			Restated
Net income (loss) including noncontrolling interests	$	85.2		$	(18.1	)	$	67.1
Deferred income taxes	8.7			0.2			8.9
(Increase) decrease in inventories	(148.8		)	17.9			(130.9		)



	Year ended December 31, 2010
(in millions)	As Previously Reported			Effect of Restatement			Restated
Net income (loss) including noncontrolling interests	$	76.9		$	(7.8	)	$	69.1
Deferred income taxes	21.6			(0.5		)	21.1
(Increase) decrease in inventories	(170.8		)	8.3			(162.5		)



	Year ended December 31, 2009
(in millions)	As Previously Reported			Effect of Restatement			Restated
Net income (loss) including noncontrolling interests	$	64.5		$	(16.8	)	$	47.7
Depreciation and amortization	101.7			5.0			106.7
Deferred income taxes	(55.6		)	3.1			(52.5		)
(Increase) decrease in inventories	236.0			8.7			244.7

There was no impact to net cash flows from operating activities as a result of this restatement.