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Income taxes | 12 Months Ended
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Dec. 31, 2024
Income Tax Disclosure [Abstract] |
Income taxes | Income taxes The provision for taxes on income for the years ended December 31 consists of the following:
| 2024 |  | 2023 |  | 2022
Pretax income |  |  |  |  |
Domestic | $ | (35,733) |  |  | $ | 280,916 |  |  | $ | 257,189 |
Foreign | 99,219 |  |  | 208,111 |  |  | 202,745 |
Total pretax income | $ | 63,486 |  |  | $ | 489,027 |  |  | $ | 459,934 |
Current |  |  |  |  |
Federal | $ | 3,693 |  |  | $ | 54,319 |  |  | $ | 34,157 |
State | 1,916 |  |  | 11,282 |  |  | 10,391 |
Foreign | 57,034 |  |  | 63,617 |  |  | 61,228 |
Total current | $ | 62,643 |  |  | $ | 129,218 |  |  | $ | 105,776 |
Deferred |  |  |  |  |
Federal | $ | (34,828) |  |  | $ | (3,307) |  |  | $ | (1,884) |
State | (9,837) |  |  | (1,646) |  |  | (3,563) |
Foreign | (12,469) |  |  | (4,535) |  |  | (4,598) |
Total deferred | $ | (57,134) |  |  | $ | (9,488) |  |  | $ | (10,045) |
Total taxes | $ | 5,509 |  |  | $ | 119,730 |  |  | $ | 95,731 |
Deferred tax (liabilities)/assets are comprised of the following at December 31:
| 2024 |  | 2023
Property, plant and equipment | $ | (266,278) |  |  | $ | (137,880) |
Intangibles | (545,330) |  |  | (119,225) |
Leases | (76,225) |  |  | (48,832) |
Outside basis in Metal Packaging | (68,649) |  |  | (68,867) |
Gross deferred tax liabilities | $ | (956,482) |  |  | $ | (374,804) |
Retiree health benefits | $ | 245 |  |  | $ | 513 |
Foreign loss carryforwards | 79,314 |  |  | 62,250 |
U.S. Federal loss and credit carryforwards | 34,082 |  |  | 39,131 |
Capital loss carryforwards | 3,755 |  |  | 3,817 |
U.S. State loss and credit carryforwards | 26,181 |  |  | 21,321 |
Capitalized research and development costs | 103,043 |  |  | 87,743 |
Employee benefits | 56,192 |  |  | 51,829 |
Leases | 82,031 |  |  | 50,704 |
Accrued liabilities and other assets | 71,370 |  |  | 58,699 |
Gross deferred tax assets | $ | 456,213 |  |  | $ | 376,007 |
Valuation allowance on deferred tax assets | $ | (81,496) |  |  | $ | (70,661) |
Total deferred taxes, net 1 | $ | (581,765) |  |  | $ | (69,458) |
1 Total deferred taxes, net includes $(15,666) and $(6,228) reclassified to discontinued operations on the Consolidated Balance Sheets at December 31, 2024 and 2023, respectively. These amounts include valuation allowance on deferred tax assets of $(4,628) and $(4,395) at December 31, 2024 and 2023, respectively. The Company has total federal net operating loss (“NOL”) carryforwards of approximately $63,615 remaining at December 31, 2024. These losses are limited based upon future taxable earnings of the Company and expire between 2033 and 2039. U.S. foreign tax credit carryforwards of approximately $20,722 exist at December 31, 2024 and expire in 2027. Foreign subsidiary loss carryforwards of approximately $339,125 remain at December 31, 2024. Their use is limited to future taxable earnings of the respective foreign subsidiaries or filing groups. Approximately $241,179 of these loss carryforwards do not have an expiration date. Of the remaining foreign subsidiary loss carryforwards, approximately $13,279 expire within the next five years and approximately $84,667 expire between 2030 and 2044. Foreign subsidiary capital loss carryforwards of approximately $15,010 exist at December 31, 2024 and do not have an expiration date. Their use is limited to future capital gains of the respective foreign subsidiaries. Approximately $10,909 in tax value of state loss carryforwards and $22,232 of state credit carryforwards remain at December 31, 2024. These state loss and credit carryforwards are limited based upon future taxable earnings of the respective entities or filing group and expire between 2025 and 2045. State loss and credit carryforwards are reflected at their “tax” value, as opposed to the amount of expected gross deduction due to the vastly different apportionment and statutory tax rates applicable to the various entities and states in which the Company files. A reconciliation of the U.S. federal statutory tax rate to the actual provision for/(benefit from) income taxes is as follows:
| 2024 |  | 2023 |  | 2022
Statutory tax rate | $ | 13,332 |  |  | 21.0 | % |  | $ | 102,696 |  |  | 21.0 | % |  | $ | 96,563 |  |  | 21.0 | %
State income taxes, net of federal tax benefit | (883) |  |  | (1.4) | % |  | 12,263 |  |  | 2.5 | % |  | 10,204 |  |  | 2.2 | %
Valuation allowance | 7,763 |  |  | 12.2 | % |  | 4,486 |  |  | 0.9 | % |  | (10,477) |  |  | (2.3) | %
Tax examinations including change in reserve for uncertain tax positions | (8,613) |  |  | (13.6) | % |  | 1,819 |  |  | 0.4 | % |  | 296 |  |  | 0.1 | %
Adjustments to prior year deferred taxes | (9,129) |  |  | (14.4) | % |  | (2,489) |  |  | (0.5) | % |  | (2,110) |  |  | (0.5) | %
Foreign earnings taxed at other than U.S. rates | 12,271 |  |  | 19.3 | % |  | 13,108 |  |  | 2.7 | % |  | 14,613 |  |  | 3.2 | %
Divestiture of business | (2,954) |  |  | (4.7) | % |  | 464 |  |  | 0.1 | % |  | — |  |  | — | %
Effect of tax rate changes | (1,552) |  |  | (2.4) | % |  | 387 |  |  | 0.1 | % |  | (2,151) |  |  | (0.5) | %
Foreign withholding taxes | 5,344 |  |  | 8.4 | % |  | 4,591 |  |  | 0.9 | % |  | 4,643 |  |  | 1.0 | %
Tax credits | (11,834) |  |  | (18.6) | % |  | (18,848) |  |  | (3.9) | % |  | (14,077) |  |  | (3.1) | %
Global intangible low-taxed income (GILTI) | (5,604) |  |  | (8.8) | % |  | 4,853 |  |  | 1.0 | % |  | 4,345 |  |  | 0.9 | %
Foreign-derived intangible income | (858) |  |  | (1.4) | % |  | (1,106) |  |  | (0.2) | % |  | (657) |  |  | (0.1) | %
Foreign currency gain/(loss) on distributions of previously taxed income | 642 |  |  | 1.0 | % |  | (2,614) |  |  | (0.5) | % |  | (1,280) |  |  | (0.3) | %
IRC Subpart F income | 916 |  |  | 1.4 | % |  | 119 |  |  | — | % |  | 96 |  |  | — | %
Executive compensation limitation | 2,569 |  |  | 4.0 | % |  | 3,767 |  |  | 0.8 | % |  | 1,420 |  |  | 0.3 | %
Capitalized acquisition costs | 7,202 |  |  | 11.3 | % |  | 104 |  |  | — | % |  | (412) |  |  | (0.1) | %
Other, net | (3,103) |  |  | (4.9) | % |  | (3,870) |  |  | (0.8) | % |  | (5,285) |  |  | (1.1) | %
Provision for income taxes | 5,509 |  |  | 8.7 | % |  | 119,730 |  |  | 24.5 | % |  | 95,731 |  |  | 20.8 | %
The change in “Tax examinations including change in reserve for uncertain tax positions” is shown net of associated deferred taxes and accrued interest. Included in the change are net increases in reserves for uncertain tax positions of approximately $3,405, $2,710 and $1,780 for uncertain items arising in 2024, 2023 and 2022, respectively, combined with adjustments related to prior year items, primarily decreases related to lapses of statutes of limitations in international, federal and state jurisdictions as well as overall changes in facts and judgment. These adjustments changed the reserve by a total of approximately $(13,229), $(891) and $(1,484) in 2024, 2023 and 2022, respectively. In many of the countries in which the Company operates, earnings are taxed at rates different than in the United States. This difference is reflected in “Foreign earnings taxed at other than U.S. rates” along with other items, if any, that impacted taxes on foreign earnings in the periods presented. The benefits included in “Adjustments to prior year deferred taxes” for each of the years presented consist primarily of adjustments to deferred tax assets and liabilities arising from changes in estimates. The adjustment to deferred tax assets and liabilities in 2024 was driven largely by post-acquisition entity restructuring. Of the $11,834 of tax credits for 2024, $9,629 relates to research and development tax credits. The GILTI tax in 2024 of $(5,604) consists primarily of a prior year provision to return adjustment. The expense included in “Valuation allowance” for 2024 includes $5,969 net recognized expense associated with the recording of valuation allowances on foreign NOLs which are not expected to be utilized. The benefits included in “Valuation allowance” for 2022 include a $13,182 net recognized benefit associated with the release of valuation allowance on foreign tax credits due to an increase in projected future foreign source income. The Company maintains its assertion that its undistributed foreign earnings prior to the Eviosys acquisition are indefinitely reinvested and, accordingly, has not recorded any deferred income tax liabilities that would be due if those earnings were repatriated. However, the Company does not assert that certain current and future earnings of its Eviosys business are permanently reinvested. As of December 31, 2024, the undistributed foreign earnings total $1,071,766. While the majority of these earnings have already been taxed in the United States, a portion would be subject to foreign withholding and U.S. income taxes and credits if distributed. Computation of the deferred tax liability associated with unremitted earnings deemed to be indefinitely reinvested is not practicable at this time. Reserve for uncertain tax positions The following table sets forth the reconciliation of the gross amounts of unrecognized tax benefits at the beginning and ending of the periods indicated:
| 2024 |  | 2023 |  | 2022
Gross Unrecognized Tax Benefits at January 1 | $ | 21,677 |  |  | $ | 18,621 |  |  | $ | 18,142 |
Increases in prior years’ unrecognized tax benefits | 627 |  |  | 378 |  |  | 223 |
Decreases in prior years’ unrecognized tax benefits | (1,915) |  |  | (572) |  |  | (144) |
Increases in current year’s unrecognized tax benefits | 4,325 |  |  | 4,395 |  |  | 1,807 |
Decreases in unrecognized tax benefits from the lapse of statutes of limitations | (12,100) |  |  | (1,094) |  |  | (1,174) |
Settlements | (476) |  |  | (51) |  |  | (233) |
Gross Unrecognized Tax Benefits at December 31 | $ | 12,138 |  |  | $ | 21,677 |  |  | $ | 18,621 |
Of the unrecognized tax benefit balances at December 31, 2024 and December 31, 2023, $9,857 and $19,241, respectively, would have an impact on the effective tax rate if ultimately recognized. Interest and/or penalties related to income taxes are reported as part of income tax expense. The Company had $1,667 and $1,773 accrued for interest related to uncertain tax positions at December 31, 2024 and December 31, 2023, respectively. Tax expense for the year ended December 31, 2024, includes net interest expense of $(105), which is comprised of an interest benefit of $2,149 related to the adjustment of prior years’ items and interest expense of $2,044 on unrecognized tax benefits. The amounts listed above for accrued interest and interest expense do not reflect the benefit of a federal tax deduction which would be available if the interest were ultimately paid. The Company and/or its subsidiaries file federal, state and local income tax returns in the United States and various foreign jurisdictions. With few exceptions, the Company is no longer subject to income tax examinations by tax authorities for years before 2018. The Company believes that it is reasonably possible that the amount reserved for uncertain tax positions at December 31, 2024 will increase by $493 over the next twelve months. This change includes the anticipated increase in reserves related to existing positions offset by settlements of issues currently under examination and the release of existing reserves due to the expiration of the statute of limitations. Although the Company’s estimate for the potential outcome for any uncertain tax issue is highly judgmental, management believes that any reasonably foreseeable outcomes related to these matters have been adequately provided for. However, future results may include favorable or unfavorable adjustments to estimated tax liabilities in the period the assessments are made or resolved or when statutes of limitation on potential assessments expire. Additionally, the jurisdictions in which earnings or deductions are realized may differ from current estimates. As a result, the effective tax rate may fluctuate significantly on a quarterly basis. The Company has operations in many countries outside of the United States and the taxes paid on those earnings are subject to varying rates. The Company is not dependent upon the favorable benefit of any one jurisdiction to an extent that loss of those benefits would have a material effect on the Company’s overall effective tax rate.

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