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Change in Accounting Principle; Inventories | 3 Months Ended
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Mar. 31, 2014
Change in Accounting Principle [Abstract] |
Change in Accounting Principle | Change in Accounting Principle; Inventories Effective January 1, 2014, the Company elected to change its method of accounting for certain inventories from lower of cost, as determined by the LIFO method, or market, to lower of cost, as determined by the average cost method, or market. We believe the change is preferable as the average cost method better reflects the current value of inventory on the consolidated balance sheets, more closely aligns with how we manage inventory, and conforms the inventory costing methods to be more consistent within the Company. Supplies and materials are valued at the first-in, first out ("FIFO") or average cost methods. The Company has applied this change in method of inventory costing retrospectively to all prior periods presented in accordance with U.S. generally accepted accounting principles relating to accounting changes. As a result of the retrospective change in accounting principle, opening retained earnings as of January 1, 2013, increased $38.8 million. Certain components of our financial statements affected by the change in valuation methodology as originally reported under the LIFO method and as adjusted for the change to the average cost method are as follows (in thousands, except per share data):
|  | Three Months Ended
|  | March 31, 2013
Consolidated Statement of Income and Comprehensive Income |  | As Previously Reported (a) |  | Effect of Change |  | As Adjusted
Cost of sales |  | $ | (572,715 | ) |  | $ | 2,754 |  |  | $ | (569,961 | )
Gross profit |  | 182,492 |  |  | 2,754 |  |  | 185,246 |
Income from operations |  | 103,246 |  |  | 2,754 |  |  | 106,000 |
Income before taxes |  | 93,995 |  |  | 2,754 |  |  | 96,749 |
Provision for income taxes |  | (33,382 | ) |  | (1,073 | ) |  | (34,455 | )
Net income |  | 60,613 |  |  | 1,681 |  |  | 62,294 |
Comprehensive income |  | 63,371 |  |  | 1,681 |  |  | 65,052 |
Net income per common share |  |  |  |  |  |
Basic |  | 0.63 |  |  | 0.02 |  |  | 0.65 |
Diluted |  | 0.62 |  |  | 0.02 |  |  | 0.64 |
___________
(a) | Certain amounts in prior periods' consolidated financial statements have been reclassified to conform with the current period presentation.
|  | December 31, 2013
Consolidated Balance Sheet |  | As Previously Reported |  | Effect of Change |  | As Adjusted
Inventories |  | $ | 522,523 |  |  | $ | 71,768 |  |  | $ | 594,291 |
Deferred income tax assets |  | 75,579 |  |  | (27,963 | ) |  | 47,616 |
Retained earnings |  | 975,296 |  |  | 43,805 |  |  | 1,019,101 |
|  | Three Months Ended
|  | March 31, 2013
Consolidated Statement of Cash Flows |  | As Previously Reported |  | Effect of Change |  | As Adjusted
Net income |  | $ | 60,613 |  |  | $ | 1,681 |  |  | $ | 62,294 |
Adjustments to reconcile net income to net cash provided by operating activities: |  |  |  |  |  |
Deferred income tax provision (benefit) |  | (877 | ) |  | 1,073 |  |  | 196 |
Change in inventories |  | (1,414 | ) |  | (2,754 | ) |  | (4,168 | )
Had the Company not made this change in accounting method, "Net income" for the three months ended March 31, 2014, would have been $1.4 million higher than reported in the Consolidated Statements of Income and "Inventories" at March 31, 2014, would have been $69.5 million lower than reported in the Consolidated Balance Sheets. The components of inventories are as follows (dollars in thousands):
| March 31, 2014 |  | December 31, 2013
Raw materials | $ | 239,034 |  |  | $ | 212,027 |
Work in process | 12,453 |  |  | 13,898 |
Finished goods | 195,097 |  |  | 209,972 |
Supplies and materials | 160,722 |  |  | 158,394 |
Inventories | $ | 607,306 |  |  | $ | 594,291 |

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