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Crocs Investor Presentation Deck

APPENDIX Non-GAAP Reconciliation (Cont'd) Non-GAAP Income Tax Expense (Benefit) and Effective Tax Rate Reconciliation: Nine Months Ended September 30, Three Months Ended September 30, 2023 2022 2023 2022 GAAP income from operations GAAP income before income taxes (1) Non-GAAP income from operations GAAP non-operating income (expenses): Foreign currency losses, net Interest income Interest expense Other income (expense), net Non-GAAP income before income taxes GAAP income tax expense Tax effect of non-GAAP operating adjustments Impact of intra-entity IP transfers (²) Non-GAAP income tax expense GAAP effective income tax rate Non-GAAP effective income tax rate 273,852 233,405 295,919 (1,770) 506 (39,207) 24 255,472 56,380 5,462 (6,717) 55,125 24.2% 21.6% (in thousands) 264,063 $ 229,575 274,465 (393) 31 (34,142) 16 239,977 60,226 2,751 (8,368) 54,609 26.2% 22.8% $ 827,269 702,413 867,539 (1,622) 1,225 (124,907) 448 742,683 163,433 10,076 (19,233) 154,276 $ 23.3 % 20.8% 630,704 542,939 740,542 (1,115) 219 (86,357) (512) 652,777 140,515 18,789 (18,274) 141,030 25.9 % 21.6% (2) (!)See 'Non-GAAP income from operations and operating margin reconciliation' above for more details. In the fourth quarter of 2020, and subsequently in the fourth quarter of 2021, we made changes to our international legal structure, including an intra-entity transfer of certain intellectual property rights, primarily to align with current and future international operations. The transfers resulted in a step-up in the tax basis of intellectual property rights and correlated increases in foreign deferred tax assets based on the fair value of the transferred intellectual property rights. This adjustment represents the current period impact of these transfers. The prior year adjustment also includes the release of the valuation allowance as a result of a tax law change. CROCS inc 36
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