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Income Taxes
 12 Months Ended
Dec. 31, 2011
Income Taxes [Abstract]  
Income Taxes

Note 7 — Income Taxes

Income (loss) from continuing operations before income taxes consisted of the following:

 

      September 30,       September 30,       September 30,  
     (Dollars in thousands)
Year Ended December 31,		  
    2011     2010     2009  
       

United States

   $ (5,100 )    $ 14,269     $ 2,115  

Canada

     (976 )      2,427       (710 ) 
   

 

 

    

 

 

    

 

 

  
    $ (6,076 )    $ 16,696     $ 1,405  
   

 

 

    

 

 

    

 

 

  

Provision (benefit) for income taxes from continuing operations for the years ended December 31, consisted of the following:

 

      September 30,       September 30,       September 30,  
     (Dollars in thousands)
Year Ended December 31,		  
    2011     2010     2009  

Current income tax expense (benefit):

                        

U.S. Federal

   $ 464     $ 3,681     $ (2,491 ) 

U.S. state

     295       987       77  

Canada

     (190 )      366       (102 ) 
   

 

 

    

 

 

    

 

 

  

Total

   $ 569     $ 5,034     $ (2,516 ) 
   

 

 

    

 

 

    

 

 

  
       

Deferred income tax expense (benefit):

                        

U.S. Federal

   $ (2,187 )    $ 1,648     $ 2,065  

U.S. state

     (155 )      217       55  

Canada

     86       207       (111 ) 
   

 

 

    

 

 

    

 

 

  

Total

   $ (2,256 )    $ 2,072     $ 2,009  
   

 

 

    

 

 

    

 

 

  
       

Total income tax expense (benefit):

                        

U.S. Federal

   $ (1,723 )    $ 5,329     $ (426 ) 

U.S. state

     140       1,204       132  

Canada

     (104 )      573       (213 ) 
   

 

 

    

 

 

    

 

 

  

Total

   $ (1,687 )    $ 7,106     $ (507 ) 
   

 

 

    

 

 

    

 

 

  

The reconciliation between the effective income tax rate and the statutory federal rate for continuing operations was as follows:

 

      September 30,       September 30,       September 30,  
    Year Ended December 31,  
    2011     2010     2009  
       

Statutory Federal rate

     35.0 %      35.0 %      35.0 % 

Increase (decrease) resulting from:

                        

State and local taxes, net

     (1.6 )      1.2       10.0  

Executive life insurance

     (1.0 )      (1.8 )      (35.0 ) 

Fines and penalties

     0.3       (0.2 )      13.0  

Meals & entertainment

     (3.0 )      0.8       7.8  

Capital loss carryforward

     —         3.7       73.6  

Deferred tax expense

     1.0       1.2       —    

Change in valuation allowance

     (1.0 )      4.1       13.7  

Change in uncertain tax positions

     (1.6 )      (1.4 )      (154.0 ) 

Provision to return differences

     (0.3 )      1.4       (1.9 ) 

Other items, net

     —         (1.4 )      1.7  
   

 

 

    

 

 

    

 

 

  

Provision for income taxes

     27.8 %      42.6 %      (36.1 )% 
   

 

 

    

 

 

    

 

 

  

 

Income taxes paid for the years ended December 31, 2011, 2010, and 2009 amounted to $2.6 million, $5.3 million and $2.8 million, respectively. In 2011 and 2010, the Company received $3.3 million and $5.8 million, respectively, in income tax refunds primarily related to income tax overpayments from prior years.

At December 31, 2011, the Company had $4.8 million of tax assets for net operating losses and tax credit carryforwards. The U.S. Federal carryforwards consist of $3.5 million of net operating losses which are subject to expiration in 2030 and $0.5 million of foreign tax credit carryforwards which are subject to expiration in 2020. In addition, the Company had $0.8 million of state net operating loss carryforwards which expire at varying dates through 2030.

The Company had valuation allowances of $0.9 million on both December 31, 2011 and 2010 which relate to certain state net operating losses and foreign tax credit carryforwards, the realization of which the Company believes is less than more likely than not.

Deferred income tax assets and liabilities contain the following temporary differences:

 

      September 30,       September 30,  
     (Dollars in thousands)
December 31,		  
     2011     2010  

Deferred tax assets:

                

Compensation and benefits

   $ 16,048     $ 17,689  

Net operating loss carryforward

     4,286       2,380  

Inventory reserve

     2,472       2,432  

Accounts receivable reserve

     723       399  

Property, plant and equipment

     879       —    

Other

     1,147       1,165  
   

 

 

    

 

 

  

Total deferred tax assets

     25,555       24,065  

Valuation allowance for deferred tax assets

     (938 )      (875 ) 
   

 

 

    

 

 

  

Net deferred tax assets

     24,617       23,190  
   

 

 

    

 

 

  
     

Deferred tax liabilities:

                

Goodwill

     6,557       5,984  

Property, plant and equipment

     —         572  

Other

     480       891  
   

 

 

    

 

 

  

Total deferred liabilities

     7,037       7,447  
   

 

 

    

 

 

  
     

Total net deferred assets

   $ 17,580     $ 15,743  
   

 

 

    

 

 

  
     

Net deferred tax assets:

                

Net current deferred income taxes

   $ 5,716     $ 4,251  

Net noncurrent deferred income taxes

     11,864       11,492  
   

 

 

    

 

 

  
    $ 17,580     $ 15,743  
   

 

 

    

 

 

  

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

 

      September 30,       September 30,  
     (Dollars in thousands)
December 31,		  
     2011     2010  
     

Balance at beginning of year

   $ —       $ 1,230  
   

 

 

    

 

 

  

Additions for tax positions of current year

     92     $ —          

Settlements

     —         (1,230 ) 
   

 

 

    

 

 

  

Balance at end of year

   $ 92     $ —    
   

 

 

    

 

 

  

 

The recognition of the unrecognized tax benefits would have a favorable effect on the effective tax rate. Due to the uncertainty of both timing and resolution of income tax examinations, the Company is unable to determine whether any amounts included in the December 31, 2011 balance of unrecognized tax benefits represent tax positions that could significantly change during the next twelve months.

The Company and its subsidiaries are subject to U.S. Federal income tax as well as income tax of multiple state and foreign jurisdictions. As of December 31, 2011, the Company was subject to income tax examinations in various jurisdictions for the tax years 2006 through 2010. During 2011, the Company completed U.S. Federal income tax examinations through tax year 2008.