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Income Taxes | 12 Months Ended
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Dec. 31, 2011
Income Taxes [Abstract] |
Income Taxes |
14. | INCOME TAXES:
The components of the provision for income taxes are as follows:
|  | Year Ended December 31, |
|  | 2011 |  |  | 2010 |  |  | 2009 |
|  | (in thousands) |
Current: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | 2,639 |  |  | $ | (11,047 | ) |  | $ | (3,343 | )
State |  |  | 695 |  |  |  | 45 |  |  |  | 209 |
Deferred: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  |  | 5,380 |  |  |  | 9,743 |  |  |  | (1,663 | )
State |  |  | 904 |  |  |  | (389 | ) |  |  | (942 | )
|  | $ | 9,618 |  |  | $ | (1,648 | ) |  | $ | (5,739 | )
The difference between the Company's effective income tax rates and the statutory U.S. federal income tax rate of 35% is explained as follows:
|  | Year Ended December 31, |
|  | 2011 |  |  | 2010 |  |  | 2009 |
|  | (in thousands) |
Provision at statutory rate |  | $ | 7,800 |  |  | $ | (2,481 | ) |  | $ | (5,867 | )
State provision, net of federal benefit |  |  | 922 |  |  |  | 174 |  |  |  | (450 | )
Domestic manufacturing deduction |  |  | (389 | ) |  |  | 772 |  |  |  | — |
Sale of business |  |  | 341 |  |  |  | — |  |  |  | — |
Change in valuation allowance |  |  | 872 |  |  |  | — |  |  |  | 244 |
Other |  |  | 72 |  |  |  | (113 | ) |  |  | 334 |
|  | $ | 9,618 |  |  | $ | (1,648 | ) |  | $ | (5,739 | )
Effective (benefit) tax rate |  |  | 43.2 | % |  |  | (23.2 | )% |  |  | (34.1 | )%
The increase in the tax rate in 2011 was primarily attributable to an increase to the valuation allowance, as a result of an expected capital loss from which the Company does not expect to benefit, and the sale of all assets of the traffic systems product line of the Tubular Products facility in Houston, Texas, which included the disposal of goodwill of $1.0 million that had no corresponding tax basis. The tax effect of temporary differences that give rise to significant portions of deferred tax assets and liabilities is presented below:
|  | December 31, |
|  | 2011 |  |  | 2010 |
|  | (in thousands) |
Current deferred tax assets: |  |  |  |  |  |  |  |
Costs and estimated earnings in excess of billings on uncompleted contracts, net |  | $ | 1,459 |  |  | $ | 2,439 |
Accrued employee benefits |  |  | 3,110 |  |  |  | 1,591 |
Inventories |  |  | 1,337 |  |  |  | 1,835 |
Trade receivable, net |  |  | 625 |  |  |  | 820 |
Net operating loss carryforwards |  |  | 622 |  |  |  | — |
Accrued professional fees |  |  | 77 |  |  |  | — |
Other |  |  | 176 |  |  |  | 174 |
|  |  | 7,406 |  |  |  | 6,859 |
Valuation allowance |  |  | (350 | ) |  |  | — |
|  |  | 7,056 |  |  |  | 6,859 |
Current deferred tax liabilities: |  |  |  |  |  |  |  |
Prepaid expenses |  |  | (665 | ) |  |  | (566 | )
Current deferred tax assets, net |  |  | 6,391 |  |  |  | 6,293 |
Noncurrent deferred tax assets: |  |  |  |  |  |  |  |
Net operating loss carryforwards |  |  | 499 |  |  |  | 7,823 |
Tax credit carryforwards |  |  | 102 |  |  |  | 1,153 |
Accrued employee benefits |  |  | 2,708 |  |  |  | 1,907 |
Other assets |  |  | 3,617 |  |  |  | 1,156 |
Other |  |  | 219 |  |  |  | 400 |
|  |  | 7,145 |  |  |  | 12,439 |
Valuation allowance |  |  | (576 | ) |  |  | (105 | )
|  |  | 6,569 |  |  |  | 12,334 |
Noncurrent deferred tax liabilities: |  |  |  |  |  |  |  |
Property and equipment |  |  | (27,157 | ) |  |  | (26,916 | )
Noncurrent deferred tax liabilities, net |  |  | (20,588 | ) |  |  | (14,582 | )
Net deferred tax liabilities |  | $ | (14,197 | ) |  | $ | (8,289 | )
As of December 31, 2011, the Company had approximately $23.0 million of state net operating loss carryforwards which expire on various dates between 2019 and 2030. The Company also had state tax carryforwards of $157,000, which begin to expire in 2019. During the year ended December 31, 2011, the Company recorded an increase in the valuation allowance of $872,000, primarily related to an expected capital loss from which the Company does not expect to benefit. The remaining valuation allowance was adjusted based upon unused net operating loss carryforwards, which expired in the current year. The Company considers the earnings of the Mexican subsidiary to be indefinitely invested outside the United States on the basis of estimates that future domestic cash generation will be sufficient to meet future domestic cash needs. Should the Company decide to repatriate the foreign earnings, the income tax provision would be adjusted in the period it is determined that the earnings will no longer be indefinitely invested outside the United States, and a deferred tax liability of approximately $600,000 related to the U.S. federal and state income taxes and foreign withholding taxes on approximately $1.7 million of undistributed earnings would be recorded. A summary of the changes in the unrecognized tax benefits during the years ended December 31, 2011, 2010 and 2009 is presented below (in thousands):
|  | 2011 |  |  | 2010 |  |  | 2009 |
Unrecognized tax benefits, beginning of year |  | $ | 125 |  |  | $ | 185 |  |  | $ | 1,272 |
Decreases for settlements |  |  | — |  |  |  | (60 | ) |  |  | (1,072 | )
Decreases for lapse of statute of limitations |  |  | — |  |  |  | — |  |  |  | (25 | )
Increases for positions taken in prior years |  |  | 10 |  |  |  | — |  |  |  | — |
Increases for positions taken in the current year |  |  | 174 |  |  |  | — |  |  |  | 10 |
Unrecognized tax benefits, end of year |  | $ | 309 |  |  | $ | 125 |  |  | $ | 185 |
The Company believes it is reasonably possible the total amounts of unrecognized tax benefits at December 31, 2011 will change significantly prior to December 31, 2012, related to the anticipated settlement of $194,000 of exposure arising from our former investment in NWPA; however, actual results could differ from those currently expected. Of the balance of unrecognized tax benefits, $215,000 would affect the Company's effective tax rate if recognized at some point in the future. The Company files income tax returns in the United States Federal jurisdiction, in a limited number of foreign jurisdictions, and in many state jurisdictions. The Company is currently under examination by the Internal Revenue Service for years 2009 and 2010. With few exceptions, the Company is no longer subject to U.S. Federal or state income tax examinations for years before 2008. The Company recognizes interest and penalties related to uncertain tax positions in income tax expense. As of December 31, 2011 and 2010, the Company has approximately $72,000 and $64,000, respectively, of accrued interest related to uncertain tax positions. Total interest for uncertain tax positions increased by approximately $8,000 in 2011, increased by approximately $4,000 in 2010, and decreased by approximately $85,000 in 2009.

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- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32537-109319 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 109 -Paragraph 136, 172 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 109 -Paragraph 43, 44, 45, 46, 47, 48, 49 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 08 -Paragraph h -Article 4 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32559-109319 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32639-109319 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32718-109319 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(h)) -URI http://asc.fasb.org/extlink&oid=6881521&loc=d3e23780-122690 + Details
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