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SEC Filings

10-K
CINEMARK HOLDINGS, INC. filed this Form 10-K on 02/23/2018
Entire Document
 

CINEMARK HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

In thousands, except share and per share data

 

Current and deferred income taxes were as follows:

 

 

 

Year Ended December 31,

 

 

 

2015

 

 

2016

 

 

2017

 

Current:

 

 

 

 

 

 

 

 

 

 

 

 

Federal

 

$

71,288

 

 

$

65,303

 

 

$

54,435

 

Foreign

 

 

35,874

 

 

 

32,047

 

 

 

29,306

 

State

 

 

10,682

 

 

 

11,936

 

 

 

10,632

 

Total current expense

 

$

117,844

 

 

$

109,286

 

 

$

94,373

 

Deferred:

 

 

 

 

 

 

 

 

 

 

 

 

Federal

 

$

10,420

 

 

$

(13,667

)

 

$

(14,046

)

Foreign

 

 

(3,339

)

 

 

1,674

 

 

 

(4,270

)

State

 

 

4,014

 

 

 

6,526

 

 

 

3,301

 

Total deferred taxes

 

$

11,095

 

 

$

(5,467

)

 

$

(15,015

)

Income taxes

 

$

128,939

 

 

$

103,819

 

 

$

79,358

 

 

A reconciliation between income tax expense and taxes computed by applying the applicable statutory federal income tax rate to income before income taxes follows:

 

 

 

Year Ended December 31,

 

 

 

2015

 

 

2016

 

 

2017

 

Computed statutory tax expense

 

$

121,683

 

 

$

126,226

 

 

$

120,882

 

Foreign inflation adjustments

 

 

(1,295

)

 

 

(281

)

 

 

State and local income taxes, net of federal income tax impact

 

 

9,559

 

 

 

11,999

 

 

 

12,786

 

Foreign losses not benefited and changes in valuation allowance

 

 

(2,408

)

 

 

(34,757

)

 

 

249

 

Foreign tax rate differential

 

 

(2,660

)

 

 

(942

)

 

 

(245

)

Foreign dividends

 

 

 

 

68,684

 

 

 

13,662

 

Foreign tax credits

 

 

 

 

(62,815

)

 

 

(21,647

)

Impacts related to 2017 Tax Act (1)

 

 

 

 

 

 

(44,889

)

Changes in uncertain tax positions

 

 

3,717

 

 

 

921

 

 

 

983

 

Other — net

 

 

343

 

 

 

(5,216

)

 

 

(2,423

)

Income taxes

 

$

128,939

 

 

$

103,819

 

 

$

79,358

 

 

(1)

Includes one-time benefit due to re-measurement of net deferred tax liabilities using a lower U.S. corporate tax rate and a reassessment of permanently reinvested earnings of ($79,834),  a deemed repatriation tax of $14,512, and a reduction in deferred tax assets with regard to foreign tax credit carryforwards of $20,433.

U.S. income taxes have been provided on deemed repatriated earnings of $352,632 related to the Company’s non-U.S. companies as of December 31, 2017 as a result of the enactment of the Tax Act. The Company recorded a net transition tax of $14,512 on the deemed repatriated earnings during the year ended December 31, 2017. Before the Tax Act, U.S. income taxes and foreign withholding taxes had not been provided on earnings of $316,346 and $251,439 that had not been distributed by the Company’s non-U.S. companies as of December 31, 2015 and 2016, respectively. The Company’s intention before enactment of the Tax Act was to permanently reinvest these earnings, thereby indefinitely postponing their remittance to the U.S. While the Company’s investment in foreign subsidiaries continues to be permanent in duration, the Company may periodically repatriate a portion of these earnings to the extent that it does not incur additional U.S. tax liability.  The Company considers any excess of the amount for financial reporting over the tax basis of its investment in its foreign subsidiaries to be indefinitely reinvested. At this time, the determination of deferred tax liabilities on this amount is not practicable.

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