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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2014

Income Tax Disclosure [Abstract]

Reconciliation of Statutory Tax Rate to Effective Tax Rate

The Company’s effective income tax provision differs from the amount calculated using the statutory U.S. federal income tax rate, principally due to the following:

	Year Ended December 31,
	2014							2013							2012
(dollars in millions)	Amount				Percentage of Income Before Income Taxes			Amount				Percentage of Income Before Income Taxes			Amount				Percentage of Income Before Income Taxes
Statutory U.S. federal income tax	$	61.2			35.0	%		$	44.8			35.0	%		$	80.2			35.0	%
State income taxes, net of federal benefit	1.1				0.6	%		1.7				1.3	%		4.5				2.0	%
Foreign repatriation, net of foreign tax credits	13.5				7.7	%		(16.0		)		(12.6	)%		48.1				21.0	%
Foreign tax differential	(12.6		)		(7.2	)%		(12.3		)		(9.6	)%		(9.7		)		(4.2	)%
Change in valuation allowances	(17.7		)		(10.0	)%		20.4				15.9	%		(2.8		)		(1.2	)%
Uncertain tax positions	10.9				6.1	%		4.7				3.7	%		2.6				1.1	%
Subpart F income	1.9				1.1	%		1.5				1.2	%		4.1				1.8	%
Manufacturing deduction	(3.7		)		(2.1	)%		0.1				—	%		(3.8		)		(1.7	)%
Goodwill on disposal of business	7.5				4.2	%		—				—	%		—				—	%
Permanent and other	2.8				1.7	%		4.2				3.5	%		(0.8		)		(0.4	)%
Effective income tax provision	$	64.9			37.1	%		$	49.1			38.4	%		$	122.4			53.4	%

Pre-tax Income Attributable to Operating Segments

The following sets forth the amount of income or (loss) before income taxes attributable to each of the Company’s geographies for the years ended December 31, 2014, 2013 and 2012:

	Year Ended December 31,
(in millions)	2014				2013				2012
Income before income taxes:
United States	$	46.9			$	(4.5	)		$	126.2
Rest of the world	128.0				132.5				103.0
	$	174.9			$	128.0			$	229.2

Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits

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

(in millions)
Balance as of December 31, 2012	$	12.9
Additions attributable to Sealy on date of acquisition	9.2
Additions based on tax positions related to 2013	2.3
Additions for tax positions of prior years	7.2
Settlements of uncertain tax positions with tax authorities	(5.5		)
Balance as of December 31, 2013	26.1
Additions based on tax positions related to 2014	24.3
Additions for tax positions of prior years	0.5
Expiration of statutes of limitations	(3.2		)
Settlements of uncertain tax positions with tax authorities	(0.1		)
Balance as of December 31, 2014	$	47.6

Operating Loss and Tax Credit Carryforwards

The Company has the following gross income tax attributes available at December 31, 2014 and 2013 respectively (in millions):

	2014				2013
U.S. federal net operating loss (“FedNOLs”)	$	—			$	19.6
State net operating losses (“SNOLs”)	145.3				135.6
U.S. federal foreign tax credits (“FTCs”)	7.8				20.4
U.S. state income tax credits ("SITCs")	1.6				0.7
Foreign net operating losses (“FNOLs”)	44.2				67.1
Charitable contribution carryover ("CCCs")	8.4				—

Tax Provision Summary

The income tax provision consisted of the following:

	Year Ended December 31,
(in millions)	2014				2013				2012
Current provision
Federal	$	50.7			$	48.6			$	49.9
State	4.5				7.3				7.8
Foreign	36.9				42.3				26.3
Total current	$	92.1			$	98.2			$	84.0
Deferred provision
Federal	$	(25.2	)		$	(47.0	)		$	37.1
State	(1.2		)		0.4				4.2
Foreign	(0.8		)		(2.5		)		(2.9		)
Total deferred	(27.2		)		(49.1		)		38.4
Total income tax provision	$	64.9			$	49.1			$	122.4

Deferred Tax Assets and Liabilities Recognized in the Consolidated Balance Sheets

The net deferred tax assets and liabilities recognized in the accompanying Consolidated Balance Sheets consisted of the following:

	December 31,
(in millions)	2014				2013
Deferred tax assets:
Stock-based compensation	$	12.4			$	10.0
Accrued expenses and other	57.9				53.7
Net operating losses, foreign tax credits and charitable contribution carryforward	30.6				55.3
Inventories	4.5				4.6
Intangible assets	14.5				9.0
Property, plant and equipment	4.0				3.9
Total deferred tax assets	123.9				136.5
Valuation allowances	(21.7		)		(39.4		)
Total net deferred tax assets	$	102.2			$	97.1
Deferred tax liabilities:
Transaction costs	$	(258.1	)		$	(261.9	)
Property, plant and equipment	(45.7		)		(62.5		)
Accrued expenses and other	(4.5		)		(4.3		)
Total deferred tax liabilities	(308.3		)		(328.7		)
Net deferred tax liabilities	$	(206.1	)		$	(231.6	)

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Tabular disclosure of the components of income tax expense attributable to continuing operations for each year presented including, but not limited to: current tax expense (benefit), deferred tax expense (benefit), investment tax credits, government grants, the benefits of operating loss carryforwards, tax expense that results from allocating certain tax benefits either directly to contributed capital or to reduce goodwill or other noncurrent intangible assets of an acquired entity, adjustments of a deferred tax liability or asset for enacted changes in tax laws or rates or a change in the tax status of the entity, and adjustments of the beginning-of-the-year balances of a valuation allowance because of a change in circumstances that causes a change in judgment about the realizability of the related deferred tax asset in future years.

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Tabular disclosure of the components of net deferred tax asset or liability recognized in an entity's statement of financial position, including the following: the total of all deferred tax liabilities, the total of all deferred tax assets, the total valuation allowance recognized for deferred tax assets.

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Tabular disclosure of the reconciliation using percentage or dollar amounts of the reported amount of income tax expense attributable to continuing operations for the year to the amount of income tax expense that would result from applying domestic federal statutory tax rates to pretax income from continuing operations.

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Tabular disclosure of income before income tax between domestic and foreign jurisdictions.

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Tabular disclosure of tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities (i.e., uncertain tax positions) and other types of income tax contingencies, including: (1) the policy on classification of interest and penalties; (2) a tabular reconciliation of the total amounts of unrecognized tax benefits at the beginning and end of the period; the total amount(s) of: (3) unrecognized tax benefits that, if recognized, would affect the effective tax rate, and (4) interest and penalties recognized in each of the income statement and balance sheet; (5) for positions for which it is reasonably possible that the total amounts unrecognized will significantly change within 12 months of the reporting date the: (i) nature of the uncertainty, (ii) nature of the event that could occur that would cause the change, and (iii) an estimate of the range of the reasonably possible change or a statement that an estimate of the range cannot be made; and (6) a description of tax years that remain subject to examination by major tax jurisdictions.

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Tabular disclosure of pertinent information, such as tax authority, amounts, and expiration dates, of net operating loss carryforwards, including an assessment of the likelihood of utilization.

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