Entity information:
Income Taxes
 
Income before income taxes for the Company’s domestic and foreign operations was as follows:
 
 
 
Years Ended June 30,
($ in millions)
 
2017
 
2016
 
2015
Domestic
 
$
56.0

 
$
17.3

 
$
64.3

Foreign
 
14.2

 
4.2

 
24.8

Income before income taxes
 
$
70.2

 
$
21.5

 
$
89.1


 
The provision (benefit) for income taxes from continuing operations consisted of the following:
 
 
Years Ended June 30,
($ in millions)
 
2017
 
2016
 
2015
Current:
 
 

 
 

 
 

Federal
 
$
(24.5
)
 
$
4.7

 
$
(39.3
)
State
 
(1.1
)
 
0.4

 
1.2

Foreign
 
7.2

 
4.3

 
8.1

Total current
 
(18.4
)
 
9.4

 
(30.0
)
Deferred:
 
 

 
 

 
 

Federal
 
38.7

 
0.1

 
60.2

State
 
3.5

 
0.5

 
0.1

Foreign
 
(0.6
)
 
0.2

 
0.1

Total deferred
 
41.6

 
0.8

 
60.4

Total income tax expense
 
$
23.2

 
$
10.2

 
$
30.4


 
The following is a reconciliation of income taxes computed at the U.S. Federal income tax rate to the Company’s effective income tax rates:
 
 
 
Years Ended June 30,
(% of pre-tax income)
 
2017
 
2016
 
2015
Statutory federal income tax rate
 
35.0
 %
 
35.0
 %
 
35.0
 %
State income taxes, net of federal tax benefit
 
2.0

 
2.2

 
2.2

Foreign tax rate differential
 
(1.5
)
 
5.5

 
(1.6
)
Domestic manufacturing deduction
 
(3.0
)
 
(7.0
)
 
(2.7
)
Research and development tax credit
 
(3.9
)
 
(8.4
)
 
(0.9
)
Law changes
 
0.9

 
(3.8
)
 
1.8

Increases (decreases) in valuation allowances
 
1.1

 
2.1

 
(0.3
)
Adjustments of prior years' income taxes
 
3.3

 
1.3

 
(0.1
)
Unremitted earnings of foreign subsidiaries
 
(1.2
)
 
12.7

 
—

Non-deductible goodwill impairment
 
—

 
5.1

 
—

Other, net
 
0.3

 
2.7

 
0.7

Effective income tax rate
 
33.0
 %
 
47.4
 %
 
34.1
 %

 
Due to a change in business strategy for one of our foreign subsidiaries, the Company changed its intent with regard to the indefinite reinvestment of the foreign earnings for this subsidiary. As a result of this change, the Company recorded a tax charge of $2.8 million during fiscal year 2016.

Deferred taxes are recorded for temporary differences between the carrying amounts of assets and liabilities and their tax bases.  The significant components of deferred tax assets and liabilities that are recorded in the consolidated balance sheet are summarized in the table below. A valuation allowance is required when it is more likely than not that all or a portion of a deferred tax asset will not be realized. As of June 30, 2017, the Company had state net operating loss carryforwards of $361.8 million expiring between 2019 and 2037. Valuation allowances increased by $0.8 million during fiscal year 2017 primarily due to decreases in projected future taxable income. A significant portion of the state net operating loss carryforwards are subject to an annual limitation that under current law is likely to limit future tax benefits to approximately $5 million.
 
 
 
June 30,
($ in millions)
 
2017
 
2016
Deferred tax assets:
 
 

 
 

Pensions
 
$
139.8

 
$
193.5

Postretirement provisions
 
54.4

 
51.0

Net operating loss carryforwards
 
23.1

 
20.5

Derivatives and hedging activities
 
2.4

 
14.8

Other
 
44.8

 
37.4

Gross deferred tax assets
 
264.5

 
317.2

Valuation allowances
 
(18.5
)
 
(17.7
)
Total deferred tax assets
 
246.0

 
299.5

Deferred tax liabilities:
 
 

 
 

Depreciation
 
(347.5
)
 
(333.0
)
Intangible assets
 
(19.4
)
 
(20.4
)
Inventories
 
(50.1
)
 
(27.4
)
Other
 
(6.2
)
 
(12.9
)
Total deferred tax liabilities
 
(423.2
)
 
(393.7
)
Deferred tax liabilities, net
 
$
(177.2
)
 
$
(94.2
)

 
As of June 30, 2017, the Company had $99.1 million of indefinitely reinvested foreign earnings for which we have not provided deferred income taxes. Upon distribution of those earnings in the form of dividends or otherwise, the Company would be subject to U.S. income taxes and withholding taxes in various foreign tax jurisdictions. It is not practical to calculate these taxes due to the complex and hypothetical nature of the calculations. Due to a change in foreign cash requirements for one of the Company’s subsidiaries, the Company changed its intent with regard to indefinite reinvestment of foreign earnings of this subsidiary. As a result of this change, the Company repatriated $11.5 million of foreign earnings during fiscal year 2017 and recognized associated tax benefits of $0.9 million. The remaining balance of unremitted foreign earnings continues to be indefinitely reinvested.

The Company does not have unrecognized tax benefits as of June 30, 2017, 2016 and 2015. The Company recognizes interest and penalties accrued on any unrecognized tax benefits as of a component of income tax expense.

All years prior to fiscal year 2013 have been settled with the Internal Revenue Service and with most significant state, local and foreign tax jurisdictions.