Helios Technologies Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Income Taxes (Tables)

Income Taxes (Tables)

12 Months Ended

Dec. 30, 2023

Schedule of Income before Income Tax, Domestic and Foreign

For financial reporting purposes, income before income taxes includes the following components:


	For the year ended
	December 30, 2023		December 31, 2022		January 1, 2022
United States	$	12.8	$	71.3	$	87.1
Foreign		36.4		50.5		44.1
Total	$	49.2	$	121.8	$	131.2

Schedule of Components of Income Tax Provision (Benefit)

The components of the income tax provision (benefit) are as follows:


	For the year ended
	December 30, 2023			December 31, 2022			January 1, 2022
Current tax expense (benefit):
United States	$	6.7		$	12.3		$	10.7
State and local		1.5			0.4			3.1
Foreign		11.4			15.9			17.3
Total current		19.6			28.6			31.1
Deferred tax expense (benefit):
United States		(3.6	)		(0.4	)		(1.1	)
State and local		(1.4	)		(2.6	)		0.2
Foreign		(2.9	)		(2.2	)		(3.6	)
Total deferred		(7.9	)		(5.2	)		(4.5	)
Total income tax provision	$	11.7		$	23.4		$	26.6

Schedule of Effective Income Tax Rate Reconciliation

The reconciliation between the effective income tax rate and the U.S. federal statutory rate is as follows:


	For the year ended
	December 30, 2023			December 31, 2022			January 1, 2022
U.S. federal taxes at statutory rate	$	10.3		$	25.6		$	27.5
Increase (decrease)
Capitalized transaction costs		0.2			0.3			—
Foreign income taxed at different rate		1.4			1.7			3.6
FDII deduction		(1.2	)		(2.8	)		(3.2	)
Changes in estimates related to prior years including foreign		0.1			0.2			(0.2	)
State and local taxes, net		0.4			(1.0	)		2.7
Current year tax credits		(1.0	)		(0.9	)		(0.5	)
Foreign deferred other true up		(1.8	)		(1.0	)		(1.6	)
Change in reserve		0.2			0.2			(1.9	)
Excess officer compensation		1.3			1.4			—
Change in valuation allowance		1.3			—			—
Other		0.5			(0.3	)		0.1
Income tax provision	$	11.7		$	23.4		$	26.6

Schedule of Deferred Tax Assets and Liabilities

Deferred income tax assets and liabilities are provided to reflect the future tax consequences of differences between the tax basis of assets and liabilities and their reported amounts in the financial statements. The temporary differences that give rise to significant portions of the deferred tax assets and liabilities as of December 30, 2023 and December 31, 2022, are presented below:


	December 30, 2023			December 31, 2022
Deferred tax assets:
Foreign tax benefit of U.S. reserves	$	1.4		$	1.9
Net operating losses		6.2			6.2
Inventory		3.7			3.2
Intangible assets and goodwill		0.7			0.7
Lease liability		4.5			2.0
Capitalized research expenditures		8.0			3.8
Interest expense limitation carryforward		3.6			—
Accrued expenses and other		6.4			5.2
Other comprehensive income		3.0			5.6
Total deferred tax assets		37.5			28.6
Less: Valuation allowance		(3.0	)		(1.7	)
Net deferred tax assets		34.5			26.9
Deferred tax liabilities:
Depreciation		(7.4	)		(8.6	)
Right of use asset		(4.4	)		(1.9	)
Intangible assets and goodwill		(78.1	)		(75.5	)
Other deferred tax liabilities		—			(0.3	)
Total deferred tax liabilities		(89.9	)		(86.3	)
Net deferred tax liabilities	$	(55.4	)	$	(59.4	)

Schedule of Unrecognized Tax Benefits Roll Forward

The following is a roll-forward of the Company’s unrecognized tax benefits:


Unrecognized tax benefits - January 2, 2021	$	11.4
Decreases from positions taken during prior periods		(0.2	)
Increases from positions taken during current period		0.6
Lapse of statute of limitations		(2.8	)
Unrecognized tax benefits - January 1, 2022	$	9.0
Increases from positions taken during prior periods		0.9
Increases from positions taken during current period		0.2
Settled positions		(0.2	)
Lapse of statute of limitations		(2.0	)
Unrecognized tax benefits - December 31, 2022	$	7.9
Increases from positions taken during prior periods		1.1
Increases from positions taken during current period		0.2
Settled positions		(2.7	)
Lapse of statute of limitations		(0.4	)
Unrecognized tax benefits - December 30, 2023	$	6.1