v3.25.3
Income Taxes (Tables)
 12 Months Ended
Dec. 31, 2024
Income Tax Disclosure [Abstract]  
Schedule of Income before Income Tax, Domestic and Foreign
Components of the Company's income (loss) before taxes are as follows:
Year ended December 31,
202420232022
(in thousands)
(As Restated)(As Restated)(As Restated)
Domestic (including U.S. exports)$(358,855)$(304,300)$(151,022)
Foreign subsidiaries49,645 37,847 37,086 
$(309,210)$(266,453)$(113,936)
Components of the Company's Income Tax Provision (Benefit)
Components of the Company’s income tax provision are as follows:
Year ended December 31,
202420232022
(in thousands)(As Restated)(As Restated)(As Restated)
Current taxes
Federal$15,141 $8,973 $12,871 
State3,215 2,911 2,125 
Foreign14,374 11,318 10,961 
Total current taxes32,730 23,202 25,957 
Deferred taxes:
Federal(13,647)(16,776)3,178 
State(538)1,622 2,010 
Foreign67 150 (1,652)
Total deferred taxes(14,118)(15,004)3,536 
Total tax provision$18,612 $8,198 $29,493 
Summary of Deferred Tax Assets and Deferred Tax Liabilities
The tax effects of temporary differences that have resulted in the creation of deferred tax assets and deferred tax liabilities at December 31, 2024, 2023 and 2022 are as follows:
December 31,
202420232022
(in thousands)
(As Restated)(As Restated)(As Restated)
Deferred tax assets:
Tax credits$3,411 $5,023 $6,179 
Accounts receivable and allowances1,063 1,093 1,577 
Net operating loss carryforwards37,725 20,041 28,090 
Accrued expenses20,374 17,007 13,164 
Interest expense limitation carryforwards55,778 29,445 10,488 
Lease liabilities50,123 46,231 38,614 
Inventory10,056 8,257 9,068 
Stock based compensation6,068 4,386 4,747 
Capitalized research & development expenses9,474 4,245 2,474 
Capital loss on sale of Crosman11,260 — — 
Lugano other expense (2)
78,076 43,104 21,640 
Other1,759 3,806 3,401 
Total deferred tax assets$285,167 $182,638 $139,442 
Valuation allowance (1)
(181,962)(84,334)(50,149)
Net deferred tax assets$103,205 $98,304 $89,293 
Deferred tax liabilities:
Intangible assets$(143,105)$(136,623)$(150,148)
Property and equipment(22,661)(23,832)(23,533)
Repatriation of foreign earnings(38)(38)(38)
Prepaid and other expenses(1,256)(842)(865)
Right of use assets(44,236)(40,233)(33,766)
Total deferred tax liabilities$(211,296)$(201,568)$(208,350)
Total net deferred tax liability$(108,091)$(103,264)$(119,057)

(1)Primarily relates to the Trust and 5.11, Arnold, Lugano and Velocity operating segments.
(2) Lugano other expense represents losses recognized at Lugano in the years ending December 31, 2024, 2023 and 2022 which do not meet the requirements for deduction under ASC 740 - Income taxes, until the year ended December 31, 2025.
Reconciliation Between Federal Statutory Rate and Effective Income Tax Rate
The reconciliation between the Federal Statutory Rate and the effective income tax rate for 2024, 2023 and 2022 are as follows:
Year ended December 31,
202420232022
(As Restated)(As Restated)(As Restated)
United States Federal Statutory Rate21.0 %21.0 %21.0 %
State income taxes (net of Federal benefits)3.1 1.6 2.3 
Foreign income taxes (1.3)(1.5)(1.9)
Impact of subsidiary employee stock options(0.2)1.3 (0.1)
Non-deductible acquisition costs(0.2)— (0.4)
Impairment expense(0.5)(5.9)(4.8)
Non-recognition of various carryforwards at subsidiaries(28.6)(18.2)(37.3)
United States tax on foreign income0.4 (0.8)(0.6)
Dividend (net of dividend received deduction)0.3 (3.3)(2.8)
Utilization of tax credits1.6 2.4 6.4 
Tax effect – loss on sale of Crosman(1.7)— — 
Effect of classification of assets held for sale— — (7.5)
Other0.1 0.3 (0.2)
Effective income tax rate(6.0)%(3.1)%(25.9)%
Reconciliation of Unrecognized Tax Benefits
A reconciliation of the amount of unrecognized tax benefits for 2024, 2023 and 2022 are as follows (in thousands):
Balance at January 1, 2022$1,254 
Additions for current years’ tax positions91 
Additions for prior years’ tax positions 15 
Reductions for prior years’ tax positions (71)
Reductions for expiration of statute of limitations$(73)
Balance at December 31, 2022$1,216 
Additions for current years’ tax positions28,325 
Additions for prior years’ tax positions 33 
Reductions for prior years' tax positions(184)
Reductions for expiration of statute of limitations(68)
Balance at December 31, 2023$29,322 
Additions for current years’ tax positions7,802 
Additions for prior years’ tax positions — 
Reductions for prior years' tax positions(25)
Reductions for expiration of statute of limitations(73)
Balance at December 31, 2024$37,026 
The unrecognized tax benefits are recorded in the consolidated balance sheet in other noncurrent liabilities.